Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF

rd Annual Report 23 2 0 1 7 - 1 8 Hon'ble Prime Minister Shri flagging off the first UDAN Flight under Regional Connectivity Scheme (RCS) on - sector at Jubbarhati, .

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Highlights 2017-18 02 About AAI 08 General Information 10 Brief Profile of Board Members, Chief Vigilance Officer and KMP 11 Board's Report 14 Corporate Governance Report 23 Management Discussion & Analysis (MD&A) 27 Annexure 3 to Board's Report 52 Annual Report on CSR Activities 57 Sustainability Report 67 Financial Statements of AAI & Auditor's Report thereon 70 Financial Statements of CHIAL & Auditor's Report thereon 110 Financial Statements of AAICLAS Company Ltd. & Auditor's Report thereon 148

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06 HIGHLIGHTS Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

About AAI Airports Authority of India (AAI) came into existence on 1st April 1995. AAI has been constituted as a statutory authority under the Airports Authority of India Act, 1994. It has been created by merging the erstwhile International Airports Authority of India and National Airports Authority with a view to accelerate the integrated development, expansion and modernisation of the air traffic services, passenger terminals, operational areas and cargo facilities at the airports in the country. The main functions of AAI are as under : • Control and Management of the Indian airspace (excluding special user airspace) extending beyond the territorial limits of the country, as accepted by ICAO. • Provision of Communication, Navigational and Surveillance aids.

08 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Mission "TO BE THE FOUNDATION of an enduring Indian aviation network, providing high quality, safe and customer - oriented airport and air navigation services thereby acting as a catalyst for economic growth in the areas we serve."

Vision AAI's vision till 2026 is : To be the principal aviation services provider in the Country, AAI shall • Adopt and facilitate the use of contemporary air navigation services; • Upgrade and develop airport infrastructure; • Support improving air connectivity at unserved and under - served airports; • Have a restructured organization; • Focus on profitable operation at major airports through continuing efforts on cost reduction and enhancing non - aeronautical revenue.

Vadodara Airport

• Expansion and strengthening of operational areas, viz. Runways, Aprons, Taxiways etc. and provision of ground based landing and movement control aids for aircrafts & vehicular traffic in operational area. • Design, Development, Operation and Maintenance of passenger terminals. • Development and Management of cargo terminals at international and domestic airports. • Provision of passenger facilities and information systems in the passenger terminals. 129 23 9 77 20 International Customs Domestic Civil Enclaves at Airports Defence Airfileds

23rd Annual Report 2017-18 09 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

GENERAL INFORMATION

Board Members as on March 31, 2018 Present Board Members* Dr. Guruprasad Mohapatra, IAS Dr. Guruprasad Mohapatra, IAS Chairman Chairman Government Directors Government Directors Shri B. S. Bhullar, IAS Shri B. S. Bhullar, IAS Director General of Civil Aviation Director General of Civil Aviation Shri Arun Kumar, IAS Shri Arun Kumar, IAS Addl. Secy., Ministry of Civil Aviation Addl. Secy., Ministry of Civil Aviation

Ms. Gargi Kaul, IA & AS Ms. Gargi Kaul, IA & AS Addl. Secy. & Financial Advisor, Ministry of Civil Aviation Addl. Secy. & Financial Advisor, Ministry of Civil Aviation Functional Directors Functional Directors Shri Sudhir Raheja, Member (Planning) Shri S. Suresh, Member (Finance) Shri S. Suresh, Member (Finance) Shri Anuj Aggarwal, Member (Human Resources) Shri Anuj Aggarwal, Member (Human Resources) Shri I. N. Murthy, Member (Operations) Shri A. K. Dutta, Member (Air Navigation Services) Shri A. K. Pathak, Member (Planning) Shri I. N. Murthy, Member (Operations) Shri Vineet Gulati, Member (Air Navigation Services) Independent Directors Independent Directors Dr. (Ms.) Tuktuk Ghosh Kumar, IAS (Retd.) Dr. (Ms.) Tuktuk Ghosh Kumar, IAS (Retd.) Air Chief Marshal (Retd.) Fali Homi Major Air Chief Marshal (Retd.) Fali Homi Major Dr. Kasam Venkateswarlu

*As on the date of Board's Report

CORPORATE HEADQUARTERS Airports Authority of India, Rajiv Gandhi Bhawan, , New Delhi - 110003 Ph: +91-11-24632950; Fax: +91-11-24632990; Website: www.aai.aero

Northern Region Regional Executive Director, Airports Authority of India, Operational Offices Complex Rangpuri, IGI Airport -110 037 Tel: 011- 25652343/ 25654212; Fax: 011- 25656451; E-mail : [email protected] Western Region Regional Executive Director, Airports Authority of India, Porta Cabins, New Airport Colony, Opposite Hanuman Road, Vile Parle East, Mumbai-400099 Tel: 022-28300606; Fax: 022-28300606; E-mail: [email protected] Southern Region Regional Executive Director, Airports Authority of India, ATS Complex, Airport, Chennai- 600 027 Tel: 044-22561234 / 22561515; Fax: 044-22561010; E-Mail: [email protected]

Eastern Region Regional Executive Director, Airports Authority of India, NSCBI Airport, -700 052 Tel: 033 - 25119616 / 2511 9944; Fax: 033 - 25118873; E-mail: [email protected]

North-east Region Regional Executive Director, Airports Authority of India, LGB International Airport, Guwahati - 781 015 Tel: 0361-2840223; Fax : 0361-2840042; E-mail : [email protected]

10 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

BRIEF PROFILE

Dr. Guruprasad Mohapatra Chairman

Dr. Guruprasad Mohapatra is a 1986 batch IAS Officer from Cadre. He is an Alumnus of Jawaharlal Nehru University (JNU) and holds Master's Degree in Political Science and M. Phil in International Relations from JNU. He earned his Ph.D from M S University, Baroda and an MBA from Faculty of Economics, University of Slovenia. Of his vast experience that spans over 30 years, he had a long stint in the power sector, where he was involved in comprehensive reforms in the power sector and restructuring of the erstwhile Gujarat Electricity Board (GEB) into several commercial entities. He has rich and varied experience in the chemical and fertilizer sector too, as he has worked as the Managing Director of Gujarat Alkalies and Chemicals Ltd. (GACL) and Managing Director of Gujarat Narmada Valley Fertilizers Company Limited (GNFCL).He also held the position of Municipal Commissioner of & Ahmedabad City. Prior to Joining AAI, he worked as a Joint Secretary in the Department of Commerce in . Besides serving governing body of various government organizations, he serves as Director on the Board of Aerospace and Aviation Sector Skill Council and AAICLAS - a 100% Subsidiary of AAI. GOVERNMENT DIRECTORS

B. S. Bhullar, IAS Arun Kumar Gargi Kaul, IA&AS Director General of Civil Aviation Addl. Secy., Ministry of Civil Aviation Addl. Secy. & Fin. Advisor, MoCA Sh. Balvinder Singh Bhullar, a 1986 Sh. Arun Kumar, a 1989 batch IAS Ms. Gargi Kaul, a 1984 Batch IA & AS batch IAS Officer from the UP Cadre is Officer from Haryana Cadre and a officer serves as Additional Secretary & the Chief of Directorate General of Civil Maths Graduate serves as Additional Financial Advisor at Ministry of Civil Aviation. He holds a Master's Degree in Secretary at Ministry of Civil Aviation. Aviation. She holds a Bachelor's degree Agricultural Sciences from Punjab He has the privilege of leading the from Bhopal University and a Master's Agricultural University, Punjab. Indian delegation in 45 bilateral Air degree in M.Phil from Delhi University. He has held many major Posts Services Negotiations and has She has worked in different capacities including of Joint Secretary / successfully concluded "Open Skies in Central Govt. Offices / Departments. Additional Secretary in the Ministry of Agreement" with 11 Countries. He Before serving the Ministry of Civil Civil Aviation, District Magistrate - has an extensive experience of Aviation, she served in Bhubaneswar, Ghaziabad & Kanpur, Govt. of UP, Joint serving various government Odisha as Principal Accountant Managing Director - UP Financial d e p a r t m e n t s d e a l i n g w i t h General. Corporation. Infrastructure such as Power, Surface She also serves on the Board of Hotel Shri Bhullar is an ex-officio Member on transport, Industrial Development Corporation of India Limited, Pawan the Board of AAI and a Nominee etc. He has headed field formations as Hans Limited, India Renewable Energy Director on the Board of Collector for districts of Faridabad, Development Agency Limited, Air India Limited and Aerospace and Aviation Rohtak and Jhajjar in Haryana and Air Transport Services Limited, Air-India Sector Skill Council. U.T. Chandigarh. Engineering Services Limited, Air India He also serves as Director on the Limited and Solar Energy Corporation Board of Mumbai International of India Limited, as Nominee Director. Airport Limited and as a Nominee Director in Delhi International Airport Limited. 23rd Annual Report 2017-18 11 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

FUNCTIONAL DIRECTORS

S. Suresh Anuj Aggarwal I.N. Murthy Member (Finance) Member (HR) Member (Operations) Shri S. Suresh is a Commerce Sh. Anuj Aggarwal is an Engineering Shri Indrakanti Narasimha Murthy is Graduate and a Cost Accountant. He is Graduate from BITS Pilani. Before a Post Graduate in Physics (Electronics) also a Post Graduate in Computer taking over the charge as Member and is associated with AAI since 1985. Applications and an alumni of 14th (HR) in December 2014, he was Sh. Murthy has more than 30 years of Advanced Management Program E x e c u t i v e D i r e c t o r i n K e y experience in aviation sector and has conducted by MDI, Gurgaon. He has a Infrastructure Development (KID) held different positions in Directorate vast experience of working in various cell of AAI. During his association with of Air Traffic Management, Directorate Govt. Deptts. and PSUs and is of Aerodrome Planning, Airport AAI starting from 1989, he has held associated with AAI since 1993 and has Management & Operations of AAI. been instrumental in taking new different roles and has acquired vast Before taking over the charge of initiatives like system upgradations, experience in the field of Planning, Member (Operations) in November benchmarking, standardization of Admin, Engg., Operations, CSR and 2016, he served as Regional Executive processes. He represented India as Human Resources Management. Shri Director (Southern Region) at Chennai th Member of Indian delegation for 6 Aggarwal is a team player with the and Executive Director (Air Traffic World wide Air Transport Conference ability to handle large taskforce in a M a n a g e m e n t ) i n A i r S p a c e held in March 2013 at Montreal, disciplined & organized manner as Management Directorate at Corporate Canada. well as monitoring and motivating Headquarter of Airports Authority of He also serves as Director on the Board teams in optimizing performance India. Delhi International Airport Limited, He also serves as Director on the Board Mumbai International Airport Limited, levels. He also serves as Nominee Director of Mumbai International Airport Navi Mumbai International Airport Limited, GMR Hyderabad International on the Board of Delhi International Private Limited and as Nominee Airport Limited and as Nominee Director on the Board of Mihan India Airport Limited, Mihan India Limited Director in Chandigarh International Limited and AAICLAS - a 100% and Chandigarh International Airport Airport Limited. Subsidiary of AAI. Limited.

Shri Anil Kumar Pathak Shri Vineet Gulati, prior is a certified International to his appointment as Airport Professional Member (Air Navigation (IAP) by ACI-ICAOand S e r v i c e s ) w . e . f . holds Master Degree in 05.10.2018, has served at Environment Science & AAI in various capacities, as Executive Director (Air E n g i n e e r i n g f r o m Traffic Management), J a m i a M i l l i a I s l a m i a General Manager (Air University. Anil Kumar Pathak T r a f f i c F l o w Vineet Gulati Member (Planning) He has 30 years of rich Management) and Air Member (ANS) experience in planning, Traffic Controller in ATC design of modern state-of-art environment-friendly Centres at various international airports. airport terminals and airside infrastructure like runways, He has been mainly responsible for implementation of Air apron etc. its financial evaluation, regulatory clearances, Traffic Flow Management, Management of Air Traffic tendering & award processes and is also associated with Services, development of Aeronautical Survey, Aerodrome execution of various Greenfield & Brownfield Airport Licensing and ANS Integrated Planning Group. He was also Projects across India. responsible for the establishment of R&D Wing of Air Navigation Services. One of the foremost contribution of Shri Besides serving AAI's Board as Member (Planning), he also Gulati has been the formulation of India's Air Navigation serves on the Board of AAICLAS - a 100% Subsidiary of AAI. Strategic Plan 2020. Shri Gulati has also served as a Technical Advisor to the Representative of India in the Council of ICAO, Montreal from 2009 to 2012. 12 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

INDEPENDENT DIRECTORS

Dr. (Ms.) Tuktuk Ghosh Air Chief Marshal (Retd.) Fali H. Major Dr. Venkateswarlu Kasam Kumar, IAS (Retd.) Non-official Member (Independent) Non-official Member (Independent) Non-official Member (Independent) Dr. (Ms.) Tuktuk Ghosh Kumar, IAS Air Chief Marshal (Retd.) Fali Homi Dr. Venkateswarlu Kasam is an (Retd.), 1981 batch from Major was commissioned in the entrepreneur, educationist, and a (WB) Cadre holds a Doctorate degree on 31st December, social worker. He is an M.Sc in Physics from the University of Delhi. She taught and Ph.D. in Astronomy (Astro Physics) 1967. He has flown over 7000 hours on at its reputed Hindu College before from Osmania University, Hyderabad. joining the IAS. Allotted to the WB various aircraft and helicopters and His Doctoral thesis on ‘Studies of some Cadre, she held senior positions in the has held a number of important major meteor showers associated with State Government. She served on operational and staff appointments. long period Comets’’ received wider acclaim from academia for insightful deputation with Parliament and He was appointed as the 18th Chief of and thought provoking research. Government of India, specializing in the Air Staff of the Indian Air Force on 31st social, industry, finance and transport Dr. Kasam has established educational March 2007. infrastructure sectors. Her association institutions in Nalgonda district. He has with these sectors continues post her During his service, he received two been associated with a number of NGOs working for the development of retirement in 2015. She serves as presidential gallantry awards and two villages and contributed significantly Director in Seaways Shipping and presidential distinguished service to bring about difference in the lives of L o g i s t i c s L t d . , N h a v a S h e v a awards for exceptional service to the people. He participates in TV debates International Container Terminal Pvt. nation. He also serves as Director on of regional channels and publishes Ltd., Bharat Road Network Ltd. and the Board of IAL Airport Services articles on various socio-cultural- Guruvayoor Infrastructure Pvt. Ltd. political issues periodically in popular Limited. News Papers. CHIEF VIGILANCE OFFICER KEY MANAGERIAL PERSONNEL

R. S. Bhatti Pankaj Jain R. Tulasi Mahalakshmi Chief Vigilance Officer Executive Director (Finance & Accounts) Company Secretary Shri R. S. Bhatti is an officer of the Shri Pankaj Jain is a B.Sc(Hons) in Ms. R. Tulasi Mahalakshmi is a post of 1990 batch of Physics and Fellow Member of graduate in commerce and law. She is Institute of Chartered Accountant of Bihar cadre. He hold a degree in a member of the Institute of Company Chartered Accountancy and an M.Phil India. He is also a Cost Accountant, MBA in Finance and a Law Graduate. Secretaries of India and a recipient of in Defence and Strategic Studies. He He has rich experience of more than Gold Medal Award in Company has worked for over a decade in CBI, 30 years and has handled various Secretary Course. She has rich supervising sensitive investigations, aspects of Finance & Accounts, heading the Internal Vigilance and Taxation, PPP Projects, Project experience of 12 years in the field of Intelligence set up of CBI, interface evaluation, etc. In his present secretarial and legal. She has also with Parliament, Central Vigilance position, he is looking after Corporate worked with SBI Pension Funds, Nava Accounts, Treasury, Financial Commission, INTERPOL and Media & Bharat Ventures Limited. Borrowing, Direct/Indirect Taxation Communications. He is recipient of matters, etc. He has also held the Police Medal for Meritorious Service position of Executive Director in Key and the President's Police Medal for Infrastructure Development and Distinguished Service. Corporate Affairs & Company Secretary Directorates of AAI. 23rd Annual Report 2017-18 13 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

BOARD'S REPORT

Pakyong Airport

We are pleased to present the 23rd Board's Report of the Airports Authority of India (AAI) together with audited Statement of Accounts and the Auditors' Report thereon for the financial year ended 31st March, 2018.

FINANCIAL HIGHLIGHTS (FY 2017-18) (Amount in ` Crore)

Particulars FY 2017-18 FY 2016-17 Revenue from Operations (Aeronautical & non-aeronautical revenue) 12306.69 11860.54 Other Income 670.27 681.47 Total Revenue 12976.96 12542.01 Total Expenditure other than finance costs and Depreciation 7054.42 6453.24 Finance Costs 44.15 98.37 Profit Before Tax & Depreciation 5878.39 5990.40 Depreciation and Amortisation 1461.45 1432.79 Profit Before Tax 4416.94 4557.61 Tax expense including Deferred Tax 1615.30 1441.68 Profit After Tax 2801.64 3115.93 Amount distributed as Dividend: (i) Interim Dividend & Dividend Tax 778.71 674.00 (ii) Final Dividend & Dividend Tax 233.28 451.08 Transferred to Reserves: (i) Corporate Social Responsibility Reserve 1.71 (0.13) (ii) Airport Development Reserve 715.18 796.39 (iii) General Reserve 1072.76 1194.59

14 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

TRANSFER TO RESERVES 2018 till the date of this Board's Report:- In accordance with the provisions of the AAI Act, 1994, AAI - Shri S. Raheja, Member (Planning) superannuated on transferred ` 715.18 crore and ` 1072.76 crore to the 30th June 2018. Ministry of Civil Aviation vide its Order No. Airport Development Reserve and General Reserve, AV-24011/13/2017-AAI-MOCA dated 29th June 2018 respectively from the profits for the financial year 2017-18. entrusted Shri Anuj Aggarwal, Member (HR) additional SPECIAL DIVIDEND TO GOVERNMENT OF INDIA FOR charge of the post of Member (Planning), in addition to st THE FINANCIAL YEAR 2016-17 his own duties, with effect from 1 July 2018 for a period DIPAM, Ministry of Finance vide Minutes of the Meeting of of three months or till further orders, whichever is earlier. CMGIC held on 23.11.2017 has directed that AAI should Later, Ministry of Civil Aviation vide its Order No. st pay 100% of PAT as Dividend i.e., ` 3115.93 crore of AV-24011/13/2017-AAI-MOCA dated 21 August 2018 Dividend (including DDT) for the financial year 2016-17. approved the appointment of Shri Anil Kumar Pathak, Accordingly, AAI has paid the balance Dividend amount Executive Director (Planning) to the post of Member during December 2017. (Planning) for a period of five years with effect from the date of his assumption of charge of the post, or till the DIVIDEND date of his superannuation, or until further orders, As per the Ministry of Finance, Department of Investment whichever is the earliest. Accordingly, Shri A.K.Pathak and Public Asset Management (DIPAM) OM took over the charge as Member (Planning) and Shri F.No. 5/2/2016-Policy dated 27/5/2016, every CPSE is Anuj Aggarwal, Member (HR) was relieved from the required to pay 30% of PAT or 5% of the networth, additional charge of the post of Member (Planning) whichever is higher. Accordingly, a dividend of ` 840.50 st w.e.f. the afternoon of 21 August 2018. crore (being 30% of PAT) was proposed for the year st 2017-18 against which ` 647 crore was paid as Interim - Shri A .K. Dutta, Member (ANS) superannuated on 31 July 2018. Ministry of Civil Aviation vide its Order No. AV- Dividend and ` 193.50 crore was paid as Final Dividend. st AAI has sought exemption from Government of India for 24011/14/2017-AAI-MOCA dated 1 August 2018 any demand for Additional / Special Dividend for the entrusted Shri S. Suresh, Member (Finance) additional FY 2017-18. charge of the post of Member (ANS), in addition to his own duties, with immediate effect for a period of three CHANGES IN THE CAPITAL STRUCTURE, LONG TERM months or till further orders, whichever is earlier. LOANS AND OTHER SIGNIFICANT ITEMS Later, Ministry of Civil Aviation vide its Order No. AAI is 100% Government owned Statutory Corporation. th AV-24011/14/2017-AAI-MOCA dated 5 October 2018 There were no changes, during the financial year 2017-18, approved the appointment of Shri Vineet Gulati, ` in the capital of AAI and it stood at 656.56 crore as on Executive Director (ATM) to the post of Member (ANS) till March 31, 2018. his superannuation i.e. 31.01.2021, or until further Long Term Borrowings of AAI reduced to ` 37.43 crore in orders, whichever is the earlier, subject to the outcome of Financial Year 2017-18. Reduction in the long term the Writ Petition (C) No. 6787/2018 filed by Shri J P Alex, borrowings was mainly due to repayment of term loans ED, AAI before High Court of Delhi. Accordingly, Shri availed from financial institutions and redemption of 8.6% Vineet Gulati took over the charge as Member (ANS) and Unsecured Non-Convertible Redeemable Bonds 2018-V Shri S. Suresh, Member (Fin.) was relieved from the on due date i.e. 17th January 2018 (After 5 years from the additional charge of the post of Member (ANS) w.e.f. the date of issue of Bonds on 17th January 2013). afternoon of 05th October 2018. BOARD OF DIRECTORS, BOARD COMMITTEES AND - Dr. Kasam Venkateswarlu was appointed as part-time MEETINGS Member (Non-Official) on the Board of Airports Corporate Governance Report for the financial year Authority of India w.e.f. 16.10.2018 vide MoCA's 2017-18 form part of this Report as Annexure - 1. Details notification dated 16.10.2018. of the Board of Directors, Board Committees and Meetings IMPORTANT CHANGES IN POLICY AND MAJOR are provided in the said Annexure. EVENTS, WHICH INFLUENCED OR AFFECTED THE CHANGES IN THE CHAIRMAN AND MEMBERS OF THE PROFITABILITY OF THE AUTHORITY DURING AUTHORITY THE YEAR During the year, there were no changes in the Chairman The year 2017-18 witnessed flying become easier and and Members of the Authority. However, the following affordable for the common man. The drivers to that were changes occurred in the Board's composition of AAI, from primarily the rising middle class, low-cost carriers, and the the closure of the financial year 2017-18 i.e. from 1st April developing regional aviation market. The most significant

23rd Annual Report 2017-18 15 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

was the first-of-its-kind Regional Connectivity Scheme, Air-Sewa version 1.0, which is a portal and mobile UDAN (Ude Desh ka Aam Nagrik), which has brought application providing information to passengers about affordable flying at `2,500 per hour of flight for the 50% of the current status of flights, airport information and the seats (minimum 9 RCS seats and maximum 40 RCS services, grievance redressal and reporting, was seats per fixed wing flight and maximum 12 helicopter implemented and development of version 2.0 is in RCS seats per heli flight) connecting unserved and progress. underserved regional airports. The security infrastructure at airports is continuously Combined efforts of the government and private sector to upgraded in compliance with the norms as per the expand capacity through policy push and investment Standards and Recommended Practices (SARPS) laid have helped unlock value of air travel for small-town India. down in Annex-17 of International Civil Aviation As Indian aviation market continues to surge, including Organization (ICAO), which is the mother document for with initiatives like WINGS which provided a platform to aviation security. Keeping in mind the different threat State Governments to market themselves to Airline perceptions and inputs by different government Operators, the focus has now shifted to ensuring agencies, proactive steps are regularly taken at AAI. adequate airport infrastructure capacity. Most of India's Responding aggressively to the growth challenges largest airports are expected to exceed their design through technological advancements in civil aviation, capacity within a decade. An estimated ` 3 lakh crore Airports Authority of India (AAI) is setting up a world-class investment is needed to triple airport capacity in the next Civil Aviation Research Organization (CARO) at Begumpet 15 years. Airport, Hyderabad which will cater to ANS and Airport/ The Airports Authority of India has planned to invest Engineering research. ` 20,000 crore(approx.) in upgrading the existing airport AAI has also established Airport Operations Control infrastructure as part of Project DISHA (Driving Centre (AOCC), which will be a nerve centre for all airport Improvements in Service and Hospitality at Airports), the operations, with associated Airport Operations Data Base largest airport transformation program ever undertaken (AODB) at top 10 airports with main data centre at in the country to enhance operational efficiency and the Chennai for monitoring all the operations and overall travel experience of the travellers. collaborative decision with participation of all AAI's lease revenue from DIAL has decreased by ` 873 stakeholders. Further, the installation of AOCC is being crore due to the impact of Hon'ble Supreme Court's order carried out at two more major airports of AAI at Goa and on AERA Tariff Order of DIAL effected during 2017-18. Lucknow. Further, as compared with the Cargo Revenue booked of The most important contribution of AAI towards optimising airport operations resulting in saving billions ` 261 crore in 2016-17, no Cargo Revenue has been of dollars and the ecology by sharply reducing aircraft fuel accounted in 2017-18 as AAICLAS Company Ltd. (100% burn is the installation of sophisticated Air Traffic Flow subsidiary of AAI), has commenced Revenue billing w.e.f. Management (ATFM). The ATFM is a country-wide system 01.08.2017 and revenue booked by AAI in cargo segment to manage flow of air traffic with the implementation of has also been transferred to Cargo Company through phase-I in six metro airports, in conjunction with Flow book transfer. Management Positions (FMP) established at 22 other MEASURES TAKEN FOR IMPROVING THE FUNCTIONS airports. The phase-II will be rolled for other capacity AND PROFITABILITY OF THE AUTHORITY constrained airports after completion of phase-I. Information Security Management Systems (ISMS) policy, Also, AAI is procuring additional passenger processing Information Technology (IT) procurement systems and systems comprising 160 Common User Terminal services policy, cyber security framework, procedures Equipment (CUTE), 200 Common User Self Service (CUSS) under IT Apex Policy, policy on engaging technology kiosks, 1,000 scanners for checkin-counters, etc., and start-up firms, night parking policy, and engaging corresponding Counter Information Display Systems Mechanised Environment Support Services (MESS) on (CIDS) are to be installed shortly to ease the congestion in Quality & Cost Based Selection (QCBS) for up-keep of terminal buildings at the same time enabling efficient and airports are some of the key initiatives undertaken in the secure passenger processing. last one year besides taking forward the Ministry's Modernisation of airports and adding more airports is one initiatives like Digi-Yatra Policy for seamless passenger of the key agenda of AAI. AAI is working tirelessly towards processing through terminals from entry point to the making its airport facilities world class by constantly boarding gates, Ground Handling Regulations-2017, upgrading the infrastructure and undertaking new Regional Connectivity Scheme, etc. initiatives to meet the future requirements. AAI has

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undertaken an ambitious target of ` 4,100 crore towards v. Risks and concerns; capital expenditure on airport infrastructure development vi. Internal control systems and their adequacy; during 2018-19. AAI's initiatives towards infrastructure vii. Material developments in Human Resources, development and other measures to improve functions Industrial Relations front, including number of people and profitability have been discussed in detail in the employed; Management Discussion and Analysis which forms part of viii. Outlook ; this report as Annexure - 2. DETAILS OF WORKS COMPLETED, PROGRESS OF THE MANAGEMENT DISCUSSION & ANALYSIS SANCTIONED SCHEMES UPTO MARCH 2018 AND Management Discussion & Analysis Report forms part of DEVELOPMENT OF AIRPORTS IN NORTH EAST REGION this Report as Annexure - 2 which include discussion on Detail of works completed, progress of the sanctioned the following matters within the limits set by the AAI's schemes by AAI and development of airports in north east competitive position: region upto March 2018 is provided in Annexure - 3. i. Industry structure and developments; SUBSIDIARY / JOINT VENTURE / ASSOCIATE ii. Strength and weakness; COMPANY iii. Opportunities and Threats; As on March 31, 2018, the following are the subsidiaries / iv. Major Achievements; JVs / Associate Company of AAI:-

S. No. Name of the Subsidiary / Joint Venture / Subsidiary / Joint Venture / Associate Associate 1. Chandigarh International Airport Limited (CHIAL) Subsidiary 2. AAI Cargo Logistics & Allied Services Company Ltd. (AAICLAS) Wholly owned Subsidiary 3. Delhi International Airport Limited (DIAL) Joint Venture 4. Mumbai International Airport Limited (MIAL) Joint Venture 5. GMR Hyderabad International Airport Limited (GHIAL) Joint Venture 6. Bangalore International Airport Limited (BIAL) Joint Venture 7. National Flying Training Institute Private Limited, Gondia Joint Venture 8. MIHAN India Limited, Nagpur Joint Venture 9. Kannur International Airport Limited Joint Venture

Other than the companies listed above, AAI is also a is available on AAI's website at https://www.aai.aero/ partner in the Indian Aviation Academy, an autonomous sites/default/files/csr_policy/ Corporate%20Social%20 body which is the joint training academy of Airports Responsibility%20%26%20Sustainability%20Policy%20 Authority of India (AAI), Director General of Civil Aviation 2017-2209.pdf (DGCA) and Bureau of Civil Aviation Security (BCAS) and AAI is committed to play a larger role in India's sustainable was set up under the agis of NIAMAR-Society in 2010. It development by embedding wider economic, social and aims to provide education, training and research in the environmental objectives. During the year, AAI spent field of aviation management, in ASIA-PACIFIC Region. ` 71.91 crore on CSR equivalent to 1.95% of the average CORPORATE SOCIAL RESPONSIBILITY net profits of the last three years prescribed under the DPE In accordance with the requirements of the DPE guidelines and Section 135 of the Companies Act, 2013. guidelines on CSR and Sustainability and Section 135 of A detailed update on the CSR initiatives of AAI is provided the Companies Act, 2013, AAI has constituted a CSR in the Corporate Social Responsibility Section, which Committee. The composition and terms of reference of forms part of this Annual Report. The Annual Report on the CSR Committee is provided in the Report on Corporate Corporate Social Responsibility u/s 135 of the Companies Governance, which forms part of this Report. AAI has also Act, 2013 is annexed as Annexure - 4 to this Report. formulated a Corporate Social Responsibility Policy, which

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AUDITOR AND AUDITORS' REPORT respectively whereas Malvika P Bansod was runner-up in CAG is the sole auditor of Airports Authority of India, a under 17 girls. At senior level Chirag Shetty performed Statutory Corporation constituted under Airports exceedingly well in senior national held at Nagpur in Authority of India Act, 1994. November, 2017. AAI is required to prepare its accounts in the format Chess: prescribed under the Airports Authority of India (Annual Shakshi D Chitlange won silver medal in world youth Report and Annual Statement of Accounts) Rules, 2014 under 18 girls championship in September, 2017. At framed in consultation with the CAG and the specific national level Arpita Mukherjee, Tarini Goel finished first provision(s) relating to accounts in the Airports Authority and second runner-ups respectively in national girls under of India Act, 1994. 17 chess championship besides Sakshi D Chitlange won After preparation of the Annual Report, the same is laid silver medal in junior national under 19. before both the Houses of Parliament, together with a Roller Skating: copy of the Audit Report and any comments upon or supplement to the Audit Report, made by the CAG. Prakriti Saxena was the silver medalist in national FOREIGN EXCHANGE EARNINGS AND EXPENDITURE championship 2017-18. FOR REVENUE AND CAPITAL ITEMS SEPARATELY Table Tennis: (Amount in ` crores) Moumita Dutta, SFR Snehit, Selena Dipti, and Manush Particulars FY 2017-18 FY 2016-17 Uppal Shah performed exceedingly well in junior and Capital Items youth national at Durgapur in January, 2018. Capital Goods Purchase (157.39) (326.15) AAI teams participated in Table Tennis, Badminton, Kho- Repayment of Foreign (2.49) (2.52) Kho and Chess in national championships of the loans respective games and secured podium finish in Chess and Revenue Items Kho-Kho while secured bronze medal in women's team Spare Parts (12.19) (87.57) event of Table Tennis. Apart from the above, AAI teams Foreign Travel (5.02) (8.91) participated in All India Public Sector Tournaments in Others (77.24) (0.13) Badminton, Table Tennis, Football and Cultural activities Services 1111.36 979.61 wherein the teams finished at podium. Expenditure shown in () In all 17 sports persons were selected for cash reward for SPORTS ACTIVITIES their outstanding performances in national/international championships. Presidents of respective constituent AAI sponsored All India Public Sector Football boards were also awarded trophies on the basis of Tournament at Raipur in November 2017. Hon'ble Chief performances of their teams in inter-zonal tournaments. Minister of Chhattisgarh inaugurated the tournament and In addition to the above, sports and adventurous activities the Member (HR)/President AAI SCB, Shri Anuj Aggarwal were also conducted for AAI employees in the game of was the Guest of Honour. cricket, football, athletics, badminton, trekking and AAI engaged more than 140 sports persons (men & cycling in which more than 500 AAI employees women) in AAI Contract/Scholarship Schemes to participated. represent AAI in national level events. The sports persons so engaged represented AAI and also participated in PROGRESSIVE USE OF HINDI many national and international events in individual Airports Authority of India ensures compliance of Act and capacity also. Salient features are as under: Rules under Official Language Policy of Government of Athletics: India. During the year, Hindi workshops were conducted at CHQ, Regional Headquarters and field stations to Scholarship players Geo Jos, Aparna Roy, Hema Malini, encourage the employees for the use of Hindi. Total 38 Nitesh Poonia and C Praveen finished at podium in their Hindi workshops were conducted at CHQ during 2017-18 respective category of Junior National Championship on the subject "Google Voice Typing" where 701 held at Vijayawada in November, 2017. employees were trained. All India Official Language Badminton: Summit was organised on 28th to 30th December 2017 at Cochin where all the employees of Hindi Directorate Aakarshi Kashyap, Maisnam Meiraba Luwang secured participated. Official Language seminars were also junior national (under 17) title in girls and boys category organised at all Regional Headquarters.

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Official Language Implementation Committee meetings their manuals for bringing transparency at workplace and were conducted at CHQ and at all stations in each quarter reducing the scope for discretion. CVD on the basis of of the year. In addition, Hindi Fortnight was also organized outcome of deliberations taking place in workshops and in CHQ & every station of AAI in September 2017. During field inspections, make suggestions to the management the Hindi Fortnight at CHQ in September 2017, All India for systemic improvements on important issues. Hindi Kavi Sammelan was organized. Hindi training The updated information concerning activities and through Hindi Teaching Scheme or departmental training achievements of vigilance department for the period from are constantly organized. The inspections of Regional & st st 1 April, 2017 to 31 March, 2018 is as follows: Subordinate Offices have been carried out by Senior Level Officers of CHQ to monitor the implementation of Official (a) Implementation of 'Integrity Pact' in AAI th Language in AAI. On 16 November 2017, under the aegis • Integrity Pact (IP) was implemented in AAI from of Town Official Language Implementation Committee, a 01.04.2008. So far 326 numbers of projects valued town level Hindi competition was organised by the AAI at ` 24471.41 crore have come under the purview Corporate Headquarters. of Integrity Pact. Presently, AAI's in-house magazine 'ARPAN' is being • A meeting was held with the IEMs on 29th August, published by Corporate Headquarters. During the year, All 2017 at New Delhi. The meet was chaired by India Shield Scheme and All India Hindi Essay Competition Chairman, AAI and attended by Member (HR), has been commenced from 2017 onwards for the Member (ANS) and HODs of all major procurement subordinate offices of Corporate Headquarters, AAI. wings, GM (PMQA) and GM (Vig.) alongwith both VIGILANCE ACTIVITIES the IEMs. Various issues related to 'Integrity Pact' and difficulties faced by vendors were discussed in The Vigilance Department of AAI is headed by Chief the meeting. Vigilance Officer (CVO) of the rank of Jt. Secretary to Government of India. Sh. R. S. Bhatti, IPS has joined as full • Revised Standard Operating Procedure (SOP) time CVO in AAI on 27.12.2017 (F/N). circulated by CVC vide Circular no.02/01/2017 has been adopted by AAI w.e.f. 02.05.2017. Corporate Vigilance Department (CVD) of AAI is located at New Delhi office whereas it also has its regional offices at (b) Vigilance Issues and Activities different regions (Northern, Eastern, Western, Southern & • Sensitive Posts were last identified in AAI in the year North-Eastern). The role and functions of vigilance 2008. An exercise to review and identify afresh, the department are in conformity with CVC's special chapter sensitive posts in AAI, has been initiated coupled on "Vigilance for the PSUs". with formulating an effective Job Rotation Policy. AAI being a service organization, the role & functions of • Vigilance review of the drafts of new Procurement Vigilance Directorate is three pronged - Preventive, Manual and updated Commercial Manual has been Punitive and Detective. In its preventive role, CVD carries taken up. out awareness campaigns wherein it creates sensitivity • Nearly 100% of AAI employees, 556 customers and towards day-to-day matters having scope for 583 citizens have taken e-pledge on CVC Portal malpractices and corruption. These campaigns includes during vigilance workshops and campaigns. Vigilance Awareness Week (VAW), which is on yearly event and Vigilance Awareness programmes like • 629 Annual Property returns scrutinized for Workshops, Lectures, Seminars etc. being conducted observance of conduct rules. throughout the year at different locations to achieve the (c) Observance of Vigilance Awareness Week (VAW), adjective of zero tolerance for corruption. In its 2017 detective/surveillance role, it plans and carries out surprise, regular and CTE Type inspections to detect the In accordance with CVC's guidelines, 'Vigilance systemic failure and existence of corruption and Awareness Week - 2017' was organized from malpractices, if any. It also scrutinizes the internal audit 30.10.2017 to 04.11.2017 in all the offices, airports reports and annual property returns etc. to look for actions and units of AAI. with a vigilance angle. CVD as a part of its proactive role urges various key departments to codify their work procedures and revise

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(d) Workshops/ Training Programmes

Sl. Subject Date Venue For Executives/ No. Non-Executives 1. Vigilance as a Management Function 25-26 May, 2017 Executives and Non-Executives 2. Preventive Vigilance as a Tool of Good 26-27 October, Thirupati Executives and Non-Executives Governance 2017 3. Two Days Training Program cum 11-12 December, New Delhi All Vigilance Officers Workshop of Vigilance Officers-2017 2017 4. Vigilance as a Management Function 14-15 December, Bhopal Executives and Non-Executives 2017 5. Preventive Vigilance - A tool for 22-23 March, Executives and Non-Executives better governance 2018 6. Preventive Vigilance - A tool for 26-27 March, Mangalore Executives and Non-Executives better governance 2018

(e) CTE Type Inspections Management on systemic improvement on important Vigilance Department has conducted 06 CTE Type issues. and 04 Works inspection pertaining to Civil and Due to periodic transfers and completion of tenure of Electrical works etc. at , Belgaum, vigilance officers, vacancies keep on arising in Vigilance Jharsuguda, Rajahmundry, Vijayawada, Goa, Department. As such, in order to strengthen the Vigilance Ahmedabad and Kolkata Airports. Setup, process has been initiated for filling up the existing (f) Periodic & Surprise Inspections vacancies in the rank of Dy. General Manager/ Jt. General Manager, Assistant General Manager/ Senior Manager, 31 nos. of Periodic and 05 nos. of Surprise Manager and Assistant Manager. Inspections were conducted by CVD during the period 2017-18. Various vigilance officers have been nominated for undergoing training at CBI Academy, Ghaziabad, NIFM, (g) Issuance of Technical / Administrative Faridabad, Regional Training Centre, Madrid, Spain, M/s Instructions Quest On The Frontier Pte Ltd., Singapore as well as other During this period, 12 Technical Instructions/ government Institutes for development of their skills. An Circulars have been issued for system improvement. annual programme of training is also prepared for upgradation of the skills of all the Officers posted in (h) Disciplinary Cases Vigilance Directorate. It is being ensured that each During 2017-18, 10 major penalty cases and 21 minor Vigilance Officer undergoes at least one training during penalty cases have been finalized. the year on vigilance initiative apart from the regular (i) Vigilance Investigation trainings being imparted through HR Directorate of AAI. Vigilance Investigation has been completed in 33 SAFETY OF WOMEN EMPLOYEE cases involving 45 officials during the period 2017-18. As per the requirement of 'The Sexual Harassment of Women at Workplace (Prevention, Prohibition & (j) Recovery due to initiatives of CVD Redressal) Act, 2013 and Rules made there under, AAI has On the basis of vigilance investigation and a policy for the same. inspections conducted during the period, total Given below is the summary on the complaints handled recovery amounting to ` 2,57,45,273/- has been during the financial year 2017-18, regarding sexual made. harassment of women at workplace:- Vigilance Department as a part of its proactive role urges various key departments to codify their work procedure No. of complaints as on 01.04.2017 04 and revise their Manuals in an endeavor to bring Complaints received during the year 2017-18 06 transparency at work place and reduce the scope for Complaints disposed of during the year 07 discretion. Vigilance Department on the basis of outcome 2017-18 of deliberations likely to take place in the forthcoming Complaints pending as on 31.03.2018 03 workshops and field inspections make suggestions to the

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EMPLOYEE-EMPLOYER RELATIONS, STRIKES, ETC. By this way, Airports Authority of India on the one hand try its best to avoid Industrial conflicts e.g. Strikes /Lockouts, Airports Authority of India maintains a harmonious & Go slow, Protest rally, Mass Casual Leave and gheraos but congenial working environment and a strong employee - on the other, establish & maintain Industrial harmony. employer relationship in all its establishments and it have continued to be cordial throughout the year. During the The Government of India (Ministry of Labour and Financial Year 2017-18, there have been no loss of man Employment) has, through Gazette Notification days on account of Strike/Absenteeism and Lockout No.S.O.1808 (E) dated 05.08.2011, amended item 27 of the except hampering of operations. This is a significant First Schedule of the Industrial Disputes Act, 1947 to declare achievement on the part of AAI and shows a remarkable the 'Service in the Airports Authority of India' as 'Public Utility and healthy sign about the strong employee - employer Service'. relationships. ANNUAL ASQ AWARDS 2017 AAI is committed to the training of its personnel in the Airport Service Quality (ASQ) is the world-renowned and field of Industrial Relations Management techniques, and globally established global benchmarking programme for creating a close working relationship with its measuring passengers' satisfaction whilst they are employees, at all levels. It makes constant endeavour to travelling through an airport conducted by the Airports establish, maintain and continuously improve Council International (ACI). communications with its workforce in maintaining healthy industrial relations by settlement of issues by way ACI, a global non-profit organization of Airport Operators, of holding quarterly meetings and one union being a is an independent agency which carries out international bargaining agent. bench marking of airport through its participative program known as Airport Service Quality (ASQ) Survey AAI emphasises on healthy trade unionism and proactive which covers 34 key service areas which includes 8 major approach in dealing with the employees related issue with categories such as access, check-in, security, airport the following methods. facilities, food and beverage, retail and more. ACI-ASQ (i) Bi-partite Forums; survey is carried out at around 315 airports across North (ii) Grievance Redressal Mechanism; America, Latin America and Caribbean, Africa, Europe, (iii) Welfare Measures. Middle East and Asia. The ASQ survey results are also monitored by AERA, NITI Aayog and MoCA. Further, in AAI, the representatives of recognized union (declared on the basis of secret referendum) are allowed ASQ survey is carried out at AAI airports having passenger to participate in various committees formed for the throughput of 1.5 Million Passenger Per Annum (MPPA) or policies relating to employees and with regard to their more. During 2017, ASQ survey was carried out at 17 AAI welfare to safeguard the interest of employees as well as of airports. AAI's continuous efforts to improve the services management by securing the highest level of mutual and passenger facilities at its airports have placed AAI understanding and goodwill to maintain harmonious amongst the best service provider in the world. As many relations of employee-employer. This arrangement is not as 6 AAI airports have won 7 ASQ awards in different only resulting in higher productivity but also developing categories in Annual ASQ Awards 2017. and improving the skill of workers.

LIST OF AAI AIRPORTS WINNING ANNUAL ASQ AWARDS 2017

AIRPORT NAME POSITION AWARD CATEGORY AHMEDABAD FIRST Best Improvement by Region - Asia Pacific Best Airport by Size (2-5 million passengers per year) LUCKNOW FIRST Best Airport by Size and Region (2-5 million passengers per year) KOLKATA & PUNE THIRD Best Airport by Size (5-15 million passengers per year) CHENNAI THIRD Best Airport by Size (15-25 million passengers per year) INDORE FIRST Best Airport by Size and Region (Under 2 million passengers per year)

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Rating and Rank of 17 AAI airports in ACI-ASQ survey for the year 2017 over 2016 is given below:- 2017 2016 Name of the Difference in rating airport ASQ RANK ASQ RANK of 2017 over 2016 RATING RATING 1 2 3 4 5 6 Trivandrum 4.80 32 4.70 32 0.10 Lucknow 4.78 35 4.83 22 -0.05 Srinagar 4.78 36 4.54 45 0.24 Indore 4.76 37 - - - Kolkata 4.75 38 4.75 29 0.00 Pune 4.75 39 4.69 34 0.06 Ahmedabad 4.69 42 4.35 76 0.34 Mangalore 4.65 48 - - - Chennai 4.60 53 4.63 40 -0.03 Goa 4.56 58 4.59 41 -0.03 Jaipur 4.51 66 4.64 39 -0.13 Patna 4.49 71 - - - Guwahati 4.48 75 4.40 66 0.08 Bhubaneshwar 4.46 79 - - - Calicut 4.32 115 4.02 176 0.30 Coimbatore 4.29 125 - - - Vizag 4.09 200 - - - Average of 17 airports 4.57 4.56 0.01 World average 4.19 4.15 0.04

MEMBERS' RESPONSIBILITY STATEMENT ACKNOWLEDGEMENTS The Members to the best of their knowledge and belief The Members wish to place on record their appreciation confirm that: for the support extended by the Ministry of Civil Aviation, (i) in the preparation of the annual accounts for the DGCA, Comptroller & Auditor General of India and other financial year ended March 31, 2018, the applicable departments of the Government of India and State accounting standards had been followed and proper governments, customers, bankers, vendors, business explanation is provided where there is any material partners and other agencies. The Members also wish to departure from the same; place on record the support and cooperation received (ii) the Members had selected such accounting policies from the Regional Office of ICAO at Bangkok as well as the and applied them consistently and made judgements ICAO Headquarters at Montreal in various facets of the and estimates that are reasonable and prudent so as functioning of AAI. to give a true and fair view of the state of affairs of AAI The Members would also like to place on record their at the end of the financial year ended March 31, 2018 sincere appreciation for the valuable contribution, and of the profit of the AAI for that period; unstinted efforts and the spirit of dedication shown by the (iii) the Members had taken proper and sufficient care for employees of the AAI at all levels in ensuring an excellent the maintenance of adequate accounting records for all round operational performance. safeguarding the assets of the AAI and for preventing On behalf of and detecting fraud and other irregularities; AIRPORTS AUTHORITY OF INDIA (iv) the Members had prepared the annual accounts on a 'going concern basis'; (v) the Members had devised proper systems to ensure sd/- compliance with the provisions of all applicable laws Dr. Guruprasad Mohapatra, IAS and that such systems are adequate and are Chairman operating effectively.

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CORPORATE GOVERNANCE REPORT

Bhopal Airport

Annexure -1

CORPORATE GOVERNANCE PHILOSOPHY responsible for the establishment of cultural, ethical and Corporate Governance is a set of systems and practices to accountable growth of the organization and is ensure that the affairs of the organization are being constituted with a high level of integrated, managed in such a way which ensures accountability, knowledgeable and committed professionals. The transparency, fairness in all its transactions in the widest functional members on the Board are highly experienced sense and to meet its stakeholders' aspiration and societal personnel in their respective functional areas who provide expectations. directions to the management on operational issues, adoption of systems and best practices in management Airports Authority of India (AAI) believes that an and oversee compliance of various statutory, legal and organization must provide empowerment to the other requirements. executive management and simultaneously create a mechanism of checks and balances, which ensures that Being an unlisted Statutory Corporation constituted the decision-making powers vested in the executive under the act of Parliament i.e. Airports Authority of India management are used with due care and responsibility Act, 1994 ("the Act") and 100% owned by the and are not being misused. Our Governance practices Government of India, AAI's Board Structure / composition stems from an inherent desire to improve, innovate and is governed by the Act. In May 2010, the Department of reflects the culture of trusteeship that is deeply ingrained Public Enterprises has issued Guidelines on Corporate in our value system and forms part of the strategic Governance for Central Public Sector Enterprises which thought process. are now mandatory in nature. No Presidential Directives have been issued during the period 1st April, 2017 to 31st AAI is committed to the adoption of best governance March, 2018. AAI is complying with these guidelines to the practices and its adherence in the true spirit, at all times. extent possible. AAI's Corporate Governance processes continuously reinforce and help in actualizing the AAI's belief in ethical AAI's Board has an optimum combination of functional, corporate citizenship and is manifested through nominee, independent and woman members. Presently, exemplary standards of ethical behavior, both within the it comprises of twelve (12) members, of which six are organization as well as in external relationships. functional members including the Chairman, two members represent the Ministry of Civil Aviation (MoCA), 1. BOARD OF DIRECTORS one represent DGCA and three are part-time non-official The Board of Directors ("Board" or "the Board") of any members (independent). organization is the flag bearer of the corporate Further, AAI is in process of appointing one more non- governance principle and practice and it oversees and official member on its Board and has already written to ensures that long term interest of all the stakeholders is Ministry of Civil Aviation (MoCA) and is waiting for the protected. appointment order in this regard. AAI's Board, being the trustee of the organization, is

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The Composition of the Board as on 31.03.2018 is subject to the outcome of the Writ Petition (C) No. 6787/2018 given below:- filed by Shri J P Alex, ED, AAI before High Court of Delhi. Accordingly, Shri Vineet Gulati took over the charge as Dr. Guruprasad Mohapatra, IAS Chairman Member (ANS) and Shri S. Suresh, Member (Fin.) was relieved Shri Arun Kumar, IAS Non-official Member from the additional charge of the post of Member (ANS) w.e.f. (1) Joint Secretary the afternoon of 05th October 2018. representing MoCA 2. BOARD MEETINGS Ms. Gargi Kaul, IA&AS Non-official Member Additional Secretary The Board Meetings and its Procedures are governed by & Financial Advisor the AAI (Transaction of Business) Regulations, 1995 representing MoCA ("Regulations"). AAI complies with these Regulations Shri B.S. Bhullar, IAS Ex-Officio Member w.r.t. convening and conducting the Board / Committee Director General of Meetings. Civil Aviation AAI has an exhaustive Book of Delegated Powers (BDP) Shri S. Raheja(2) Member (Planning) and other manuals like Material Management, Works Shri S. Suresh(3) Member (Finance) Manual etc. as duly approved by the Board, which spell Shri Anuj Aggarwal(2) Member (HR) out the processes and defines the level at which any decision is to be made and are reviewed from time to time Shri A.K. Dutta(3) Member (ANS) to ensure that they are updated and meet the needs of the Shri I. N. Murthy Member (Ops.) organization. AAI has adequate Board Level Committees Dr. (Ms.) Tuktuk Ghosh Non-official Member which deliberate upon various important matters and Kumar, IAS (Retd.) (Independent) advise the Board on the course of action to be taken. Air Chief Marshal Non-official Member Regular meetings of the Board are held to discuss and (Retd.) Fali H. Major (Independent) decide on various important issues including business (1) Shri Arun Kumar, IAS has been promoted from Joint Secretary policies & strategies. The agenda items, circulated in to Additional Secretary w.e.f. 17th September 2018. advance to the members of the Board, are exhaustive in (2) Shri S. Raheja, Member (Planning) superannuated on 30th nature and detailed presentations are made during the June 2018. Ministry of Civil Aviation vide its Order No. AV- course of discussion. Every proposal is examined and 24011/13/2017-AAI-MOCA dated 29th June 2018 entrusted discussed in detail before a decision is taken. The Shri Anuj Aggarwal, Member (HR) additional charge of the Committees of the Board deliberate upon major post of Member (Planning), in addition to his own duties, with proposals before being recommended to the Board. The effect from 1st July 2018 for a period of three months or till Board regularly monitors the Action Taken Report on its further orders, whichever is earlier. decisions. Risk areas are outlined and mitigation Later, Ministry of Civil Aviation vide its Order No. AV- processes are put in place. The terms of reference, 24011/13/2017-AAI-MOCA dated 21st August 2018 approved quorum, periodicity of meeting etc. are clearly defined for the appointment of Shri Anil Kumar Pathak, Executive Director each of Board Committees, and approved by the Board. (Planning) to the post of Member (Planning) for a period of five years with effect from the date of his assumption of charge The schedule of Board / Committee meetings are of the post, or till the date of his superannuation, or until circulated to the Members in advance to enable them to further orders, whichever is the earliest. Accordingly, Shri A.K. plan their schedule for participation in the meetings. Also, Pathak took over the charge as Member (Planning) and the intervening period between the two Board meetings Shri Anuj Aggarwal was relieved from the additional charge of was not more than one hundred and twenty days. the post of Member (Planning) w.e.f. the afternoon of 21st August 2018. During the year under review, 5 (Five) meetings of the (3) Shri A. K. Dutta, Member (ANS) superannuated on 31st July Board were held i.e. on 06/06/2017, 30/08/2017, 2018. Ministry of Civil Aviation vide its Order No. AV- 09/11/2017, 10/01/2018 and 07/03/2018. 24011/14/2017-AAI-MOCA dated 1st August 2018 entrusted 3. AUDIT COMMITTEE Shri S. Suresh, Member (Finance) additional charge of the post of Member (ANS), in addition to his own duties, with As a measure of good Corporate Governance and to immediate effect for a period of three months or till further provide assistance to the Board in fulfilling the Board's orders, whichever is earlier. oversight responsibilities, an Audit Committee has been Later, Ministry of Civil Aviation vide its Order No. AV- constituted and headed by an Independent Member. 24011/14/2017-AAI-MOCA dated 5th October 2018 approved the appointment of Shri Vineet Gulati, Executive Director The Composition, quorum, power, role, review of (ATM) to the post of Member (ANS) till his superannuation i.e. information etc. of the Audit Committee is in line with the 31.01.2021, or until further orders, whichever is the earlier, DPE Guidelines. Presently, the Audit Committee

24 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

comprises of two non-official independent members and The composition of the Remuneration Committee as on one functional member. All the members of the Audit 31.03.2018 is given below:- Committee have knowledge of financial matters and at Member's Name Category Designation least one member has expertise in accounting and Dr. (Ms.) Tuktuk Non-official Chairperson financial management. Ghosh Kumar, (Independent) The composition of the Audit Committeeas on 31.03.2018 IAS (Retd.) Member is given below:- Air Chief Marshal Non-official Member (Retd.) Fali H. Major (Independent) Member's Name Category Designation Member Air Chief Marshal Non-official Chairperson (Retd.) Fali H. Major (Independent) Ms. Gargi Kaul, IA&AS Non-official Member Member Additional Secretary Member Dr. (Ms.) Tuktuk Non-official Member & Financial Advisor, Ghosh Kumar, (Independent) MoCA IAS (Retd.) Member Shri S. Suresh Functional Member 5. MEMBERS' REMUNERATION AND THEIR Member APPOINTMENT The terms of reference of the Audit Committee are: Appointment of Members, including non-official members, on the Board of AAI is done by the Central • Examination of the financial statements and the Government. Controller & Auditor General's Report thereon. While the official members are being paid remuneration • To review the follow up action on the audit as approved by the Central Government, the non-official observations of the C&AG audit. independent members are being paid sitting fee as per the 'Policy on Payment to Independent Members'. • To review the follow up action taken on the 6. CSR COMMITTEE recommendations of Committee on Public Pursuant to the provisions of Guidelines on Corporate Undertakings of the Parliament. Governance for Central Public Sector Enterprises, 2010 • Evaluation of internal financial controls and risk and applicable statutory requirements, AAI's Board has management systems. constituted a Corporate Social Responsibility Committee which is headed by an Independent Member. • Discussion with internal Auditors. The composition of the CSR Committee as on 31.03.2018 is • Any other responsibility as may be assigned by the given below:- Board from time to time. Member's Name Category Designation Meetings of the Audit Committee Dr. (Ms.) Tuktuk Non-official Chairperson The Company Secretary of the AAI acts as the Secretary of Ghosh Kumar, (Independent) the Audit Committee. Internal Auditors, Management and IAS (Retd.) Member other Senior Personnel of AAI, also attends the Meeting of Dr. Guruprasad Chairman, AAI Member Audit Committee, as and when required. Mohapatra, IAS (Functional It is being ensured that minimum of two Independent Member) (1) Members attend the meeting of the Audit Committee. It is Shri S. Raheja Functional Member only after their availability, the date of meetings is being Member fixed. During the year under review, the Committee met Shri Anuj Aggarwal Functional Member two times i.e. on 05/06/2017 and 29/08/2017. Member

4. NOMINATION AND REMUNERATION COMMITTEE (1) Shri S. Raheja superannuated on 30th June 2018 and thus The Board has constituted the Remuneration Committee ceases to be a member of the Committee. which shall recommend to the Board to carry out The terms of reference of the CSR Committee are:- evaluation of every employee's performance related pay, annual bonus / variable pay pool and policy for its • Formulate and recommend to the Board, a Corporate Social Responsibility Policy, which shall indicate the distribution across the executives and non-unionized activities to be undertaken by the AAI as specified in supervisors within the prescribed limits. Schedule VII of the Companies Act, 2013. The Remuneration Committee comprises of three non- • Recommend the amount of expenditure to be official members as its members and is chaired by an incurred on the approved CSR activities. independent member.

23rd Annual Report 2017-18 25 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

• Monitor the Corporate Social Responsibility the interest of the AAI. Further, there is no such possibility, Policy of the AAI from time to time. because the governing statue viz. the AAI Act, 1994 vide During the year under review, the CSR Committee Section 4 disqualifies the person to be member on the met four times i.e. on 02/05/2017, 05/06/2017, board of AAI in case he / she has any financial or other 30/08/2017 and 06/03/2018. interest in the Authority as is likely to affect prejudicially the discharge of his/her functions as a member. 7. ANNUAL GENERAL MEETING 9. TRAINING OF BOARD MEMBERS AAI is a statutory corporation - 100% owned by the Government of India and is governed by special Act of At AAI, continuing education and training is a continuous Parliament i.e. AAI Act, 1994. Since, Companies Act is process. Members are encouraged to attend the special not applicable to AAI and also AAI Act, 1994 does not training courses by various professional bodies including contain any provisions relating to convening annual programs by DPE to ensure that the members are general meeting, it is not required to hold any annual refreshed and equipped to perform their roles in the general meeting. highest standards and performance possible. If interested, members attend the relevant programs. 8. DISCLOSURE BY MEMBERS AND SENIOR MANAGEMENT 10. MEANS OF COMMUNICATION All the Board Members and Senior Management AAI produce periodic reports and press releases covering Officials acts in good faith, in order to promote the important matters relating to AAI. AAI also have a facility objects of the AAI and in the best interests of the AAI for information sharing with stakeholders through the use and its stakeholders. All the Board Members and of Information and Communication Technologies (ICT). Senior Management officials exercise their duties 11. WEBSITE with due and reasonable care, skill and diligence and AAI's website i.e. www.aai.aero contains dedicated exercise independent judgment. sections for stakeholders. The Annual Report of the AAI is The Board Members generally does not involve in a also available on the website in a user friendly and situation in which they may have a direct or indirect downloadable form. Apart from that, CSR initiatives, interest that conflicts, or possibly may conflict, with passengers' information, public information, vigilance, financial information etc. are also available.

26 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

MANAGEMENT DISCUSSION AND ANALYSIS

Bagdogra Airport

Annexure -2

The objective of this report is to share and keep you whereas Airports provide the ground infrastructure to abreast with the happenings and transformations handle aircraft movements. The manufacturing industry occurring within AAI, that in the industry and economy, its and aviation suppliers assemble aircrafts and provide technology and its overall business strategies. Among spare products. As a provider of supplementary processes, other things, the MD & A provides an overview of the the industry relies on general service providers such as air previous year of operations and how AAI fared in that traffic control. time. It also provides the report on the upcoming year, Indian Aviation Industry can broadly be divided into outlining future goals and approaches to new projects. Defence and civil aviation. Ministry of Civil Aviation is We begin with a general review of the industry, followed responsible for civilian aviation and Ministry of Defence is by the operational and financial details of AAI including responsible for the Indian Air Force. details of its human resources. India's civil aviation has witnessed phenomenal growth Statements in the Management Discussion and Analysis rate of approx. 18% in the last 3 years. According to IATA describing AAI's objectives, projections, estimate Traffic Study, India, at 7th position as of now, is likely to expectations may be "forward looking statements". Actual take 3rd position by 2023-24 by overtaking UK, Japan, results could differ materially from those expressed or Spain & Germany. The current rate of the growth in implied. Important factors that could influence AAI's domestic aviation sector of India is the highest globally. operations include economic developments within the However, it said that its projection of India being the third country, demand and supply conditions in the industry, largest aviation market globally by 2024 is contingent input prices, changes in Government regulations, tax laws upon its airport infrastructure and capacity growth. and other factors such as litigation and industrial relations. Domestic passenger traffic expanded at a Compound INDUSTRY STRUCTURE AND DEVELOPMENTS Annual Growth Rate (CAGR) of 13.91 per cent over The aviation industry is a service industry providing FY 06-18. International passenger traffic posted a CAGR of transport services. Air transportation shows many 9.36 per cent over FY 06-18. Freight Traffic grew at a CAGR characteristics which are typical for service industries, e.g. of 7.53 per cent over FY 06-18. Freight Traffic is expected to the intangibility of the product and the high importance grow at a CAGR of 7.27 per cent to reach 4.14 million of personal contact to the customer. tonnes in FY23. (Source: IBEF) Airlines and Airports are the two main players in the The government has allowed 100 per cent FDI under industry. While Airlines offer the actual transport service automatic route in Airports; Ground Handling Services

23rd Annual Report 2017-18 27 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

subject to sectoral regulations& security clearance;and for way of strengthening and extension of runways, Maintenance and Repair organizations; flying training construction of new apron bays has been taken up to cater institutes; and technical training institutions.100 percent to the demand from airline operators who have placed FDI under automatic route is also allowed in Non- confirmed orders for almost 900 aircrafts in the coming Scheduled Air Transport Services and Helicopter 10 years. services/seaplane services requiring DGCA approval. Under New Policy, many major cities Further, 100% FDI under automatic route is allowed in are expected to have multiple airports. Government has Scheduled air transport service, regional air transport granted approval for Noida International Airport (Jewar), service and domestic scheduled passenger airlines, Mopa (Goa), Purandar Airport (Pune), Bhogapuram however, FDI over 49 per cent would require government Airport (Visakhapatnam), Airport (Ahmedabad), approval. Hirasar Airport (Rajkot). Capex outlay of ` 50000 crore is According to data released by the Department of expected in the development of New Greenfield Airports, Industrial Policy and Promotion (DIPP), FDI inflows in wherein approval of Government of India has been given. India's air transport sector (including air freight) reached In the private sector also, upgradation and expansion is in US$ 1,658.23 million between April 2000 and June 2018. the offing for Delhi, Bengaluru, Hyderabad Airports at a cost of ` 25000 crore in the next five years' time. Recognising its role as the growth driver of the Indian economy, the Government of India has given enhanced Further, the AAI plans to develop Guwahati as an inter- trust for the infrastructure sector in the Union Budget regional hub and Agartala, Imphal and Dibrugarh as intra- 2018-19 since, allocation to Civil Aviation Ministry has regional hubs. been tripled to ` 6,602.86 crore. Towards this endeavour, Among other initiatives, the ministry is framing a cargo Government of India has brought out National Civil policy and suggested that airspace could be utilised at Aviation Policy (NCAP), which is the stepping stone to night for cargo traffic as commercial flight movement provide robust air connectivity throughout the length and would be less. Efforts are also being made for aircraft breadth of our country. The Policy also envisages to create manufacturing in India. Further, the Government of an ecosystem which encourages economic growth of the Andhra Pradesh is to develop Greenfield airports in six country, by enabling people to connect with ease at an cities-Nizamabad, Nellore, Kurnool, Ramagundam, affordable cost, through Regional Connectivity Scheme Tadepalligudem and Kothagudem under the PPP model. (RCS), aptly titled as UDAN (Ude Desh ka Aam Nagrik). Also, Indian aircraft Manufacture, Repair and Overhaul To meet the growing demand, Government of India has (MRO) service providers are exempted completely from launched a new initiative of NABH Nirman (NextGen customs and countervailing duties. Airports for Bharat), wherein systems and processes are India's aviation industry is largely untapped with huge geared to provide enhanced airport capacity to handle 1 growth opportunities, considering that air transport is still billion trips in the next 10 to 15 years. expensive for majority of the country's population, of Airport capacity upgradation and expansion require both which nearly 40 per cent is the upwardly mobile middle development of new greenfield airports and expansion of class. And the need is to implement efficient and rational existing brownfield airports and same will be funded by decisions that would boost India's civil aviation industry. the Indian private sector and Airports Authority of India by With the right policies and relentless focus on quality, cost leveraging its balance sheet. and passenger interest, India would be well placed to achieve its vision of becoming the third-largest aviation Airports Authority of India is in the process of market soon. implementing plans for development of infrastructure to meet growing aviation demand by creating additional BUSINESS OVERVIEW capacity at AAI Airports like, Chennai, Guwahati, Lucknow, Airports Authority of India (AAI) is the leading Airport Agartala, Patna, Srinagar, Pune, Trichy, Vijayawada, Port Operator and sole air navigation service provider in India. Blair, Jaipur, Mangalore, Dehradun, Jabalpur, Kolhapur, It owns and maintains 129 airports and provides air Goa, Rupsi, Leh, Calicut, Imphal, Varanasi & Bhubaneswar navigation services for over 2.8 million square nautical with a capex of ` 20,178 crore in the next 4 to 5 years. miles of air space. AAI has already awarded the works at Agartala, Calicut, Over the past two decades, AAI has been at the forefront Port Blair towards construction of new state-of-the-art of modernizing and developing airside & terminal side integrated terminals and is in the process to immediately infrastructure, air navigation services, and improving its approve the works for upgradation and expansion of services at airports to deliver a better travel experience to capacity at Chennai, Lucknow and Guwahati Airports, at a passengers. These measures have resulted in improved air cost of ` 2467 crore, ` 1383 crore and ` 1232 crore, safety and passenger satisfaction as is reflected in respectively. Similarly, upgradation of airside capacity by passenger experience survey results.

28 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

At present, top priority of the sector in general, and AAI in revenues and other from Allied services such as particular, is to transform the image of airport Consultancy projects. Aeronautical revenues for AAI are infrastructure in the country, to be the most customer- dominated by ANS charges (route navigation facilities friendly and to be at par with the best managed airports in charges and terminal navigational landing charges) the world. We aim to achieve this by augmenting our whereas its Non-aeronautical revenues come from airports with state-of-the-art infrastructure, leveraging commercial operations at airports like retail, F&B, car technology in line with global trends for Air Navigation parking, other concessions and rentals in terminals and facilities, enhancing safety & operational efficiency both in city side premises. Lease revenues from major airports like the air and on the ground. Mumbai, Delhi etc. accounts for significant contribution in AAI's persistent efforts to improve the services and AAI's revenues. As tariffs at these airports are regulated by passenger facilities at its airports have placed it amongst the Airports Economic Regulatory Authority of India the best service providers in the world. In the ASQ (Airport (AERA) with reference to traffic growth and investment Service Quality) Awards 2017 carried out by Airports plans of these airports, AAI has no control over this Council International (ACI), six of our airports were revenue stream. Contribution of Cargo revenues to AAI's adjudged as amongst the best in the world. Lucknow, total revenues remain marginal. Indore, Ahmedabad, Chennai, Kolkata and Pune airports Revenue of the Authority increased by ` 434.95 crore (3%) of AAI have been adjudged winners in various categories. as compared to previous year, details thereof is as follows: Revenue Mix AAI's revenues can be broadly categorized into Aeronautical, Non-aeronautical, Cargo, Airport lease Amount (in ` crore) S.No. Revenue FY 17-18 Share in the FY 16-17 Share in the Increase Increase Constituent AAI's Total AAI's Total (+) or (+) or Revenue in Revenue in decrease () decrease () terms of % terms of % over last FY in terms of % 1 Airport navigational 3495.34 26.93 2972.89 23.70 522.45 17.57 services 2 Airport services 4257.77 32.81 3483.98 27.78 773.79 22.21 3 Non-aeronautical 1451.01 11.18 1304.97 10.41 146.04 11.19 airport services 4 Cargo revenue* 0.00 -- 261.95 2.09 -261.95 -100.00 5 Airport lease 3102.57 23.91 3836.75 30.59 -734.18 -19.14 revenue 6 Other Income 670.27 5.17 681.47 5.43 -11.20 -1.64 Total Revenue 12976.96 100.00 12542.01 100.00 434.95 3.47

*No Cargo revenue has been accounted in 2017-18 as AAICLAS Company Ltd. - 100% Subsidiary of AAI, has commenced billing w.e.f. 1.8.2017 and revenue booked by AAI in Cargo segment has also been transferred to Cargo company through book transfer.

Revenue Mix for AAI (FY 2017-18)

5.17 26.93 23.91 Airport navigational services Airport lease revenue Airport services Other Income Non-aeronautical airport services

11.18

32.81 23rd Annual Report 2017-18 29 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Increase in Aeronautical Revenue is mainly on account of Airport Lease Income decreased by 19% on account of Increase in Aircraft Movements at AAI Airports by 17.6% decrease in DIAL's Lease Income by ` 873 crore due to the and all Airports by 13.40% in 2017-18; Increase in impact of Hon'ble Supreme Court's order on AERA Tariff Passenger movements at AAI Airports by 21% and all Order of DIAL effected during 2017-18 inspite of increase Airports by 16.50% in 2017-18; Increase due to revision in in MIAL's Lease Income by ` 139 crore in 2017-18. Airport charges vide AERA Tariff orders at major Airports Cost Mix by ` 263 crore and Increase in Throughput Revenue by ` 26.19 crore, Ground handling Revenue by ` 12.79 crore, AAI's key expense categories include employee costs Royalty on Cute Charges by ` 14.69 crore in 2017-18. (comprising employee salaries, allowances and contributions to provident fund), operating expenses Whereas increase in Non-Aeronautical Revenue is mainly including aviation security, administration expenses, on account of increase in Advertisement contracts, Duty financing costs and depreciation. Free Shops, Shops / Stalls, Money Exchange Counters, Car Rentals and Car Parking. The expenditure has increased by ` 575.62 crore (7%) in 2017-18 as compared to previous thereof, details thereof is as follows:-

Amount (in ` Crore) S.No. Cost FY 17-18 Share in the FY 16-17 Share in the Increase Increase Constituent AAI's Total AAI's Total (+) or (+) or Expenditure Expenditure decrease () decrease () in terms of % in terms of % over last FY in terms of % 1 Employee Benefits 3647.33 42.61 2789.08 34.93 858.25 30.77 Expenses 2 Operating Expenses 1597.71 18.66 1509.85 18.91 87.86 5.82 3 Administrative and 798.37 9.33 1272.02 15.93 -473.65 -37.24 Other Expenses 4 Finance Costs 44.15 0.52 98.37 1.23 -54.22 -55.12 5 Depreciation & 1461.45 17.07 1432.79 17.95 28.66 2.00 Amortization 6 Security Expenses 1011.01 11.81 882.28 11.05 128.73 14.59 Total Revenue 8560.02 100.00 7984.40 100.00 575.62 7.21

Cost Mix for AAI (FY 2017-18)

11.81% Employee Benefits Expenses

17.07% 42.61% Administrative and other Expenses Depreciation & Amortization 0.52% Operating Expenses Finance Costs

9.33% Security Expenses

18.66%

30 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Increase in Employee Benefit Expenses was mainly due to interest on Bonds and reduction in interest to Income Tax wage revision for executives w.e.f. 01/01/2017, annual Dept. increment, DA etc.; increase in perks, EL/HPL encashment Traffic Handled (2017-18 Vs 2016-17) and Actuarial Valuation of Liability in respect of Employees Traffic handled at all Indian airports taken together during Benefits. the year 2017-18 saw an increase as compared to previous Increase in Operating Expenditure was mainly on account year in the International and Domestic sector on all three of increase in R&M expenses, Up-keep expenses, areas namely, aircraft movements, passenger and freight electricity expenses and reduction in municipal taxes. handled. The total aircraft movement, passenger and Further, Security expenses increased due to deployment freight traffic have increased by 13.4%, 16.5% and 12.7% of additional CISF manpower at various airports. respectively during the year. Decrease in Admin. Expenses was due to decrease in the Details of traffic handled during the year and comparison provision for doubtful debts and decrease in IATA Admin with previous year are given below:- fees; and Decrease in finance costs was due to decrease in

Particulars 2017-18 2016-17 %age change Aircraft Movements (in numbers) International 437926 400422 9.4 Domestic 1886625 1648663 14.4 TOTAL 2324551 2049085 13.4 Passengers (in numbers) International 65475516 59284991 10.4 Domestic 243277884 205684732 18.3 TOTAL 308753400 264969723 16.5 Freight (in MT) International 2143968 1855061 15.6 Domestic 1213060 1123180 8.0 TOTAL 3357028 2978241 12.7 KEY STRENGTHS AND WEAKNESSES investors and lenders have highlighted this as one of the While large land holdings, network of airports across the key reasons for staying away from investing in India, country, expertise in providing air navigation services, despite being the fastest growing aviation market in the consistent profitability and financial resources, and world. The government is planning to correct the anomaly experienced manpower are the key strengths of AAI, Low of wide variations in airport tariffs by amending the share of non-aeronautical revenue, low growth of cargo Airports Economic Regulatory Authority of India (AERA) business, Skilled manpower shortage and training, limited Act to have provisions for new tariff models for airports as focus on MIS and Marketing are its key weaknesses. well as change the definition of major aerodromes. MAJOR OPPORTUNITIES AND THREATS AAI has exciting aspirations as it moves into a new era of development. AAI is focusing on five priorities which are Although the spurt in air traffic brought new NCAP, RCS, AAICLAS, UAH & MRO that will enhance its opportunities for AAI, it also posed a major challenge in reputation and position on a global platform. terms of expanding ground infrastructure and air navigation services. Further, there is a huge potential to develop India as an MRO hub since the second highest cost component for Approx. only 12% of the country's total aircraft fleet is Indian airline companies after fuel is Maintenance on presently deployed on regional routes. Unless aircraft which over 13-15% of their revenues are being spent. suited for regional routes fly these routes in big numbers, the idea of linking metros to non-metros would remain Leverage on Non-aeronautical Revenues such as retail, largely under-achieved. 90% of the top 40% routes are advertising, vehicle parking etc.; Increasing the Cargo connected only to metro airports, and for UDAN to be Business; Land Monetisation; Leverage on Improved successful, a concrete push with regard to aircraft suited Technology including adoption and use of state-of-the- for regional routes needs to be made. art technology like 'GAGAN - A satellite based navigation system'; Policy Support; Huge investment potential in the The wide variation in airport tariffs create challenges for Industry; International opportunities for consulting and domestic and foreign airlines who have to recover the other services and marketing initiatives to improve same from passengers. Many domestic and global engagement with customers are being seen as great

23rd Annual Report 2017-18 31 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Opportunities. strengthen the controls, significant audit observations Whereas reliance on revenues beyond the control of AAI; and corrective actions thereon are presented to the audit Obligation to implement RCS; Competition from other committee of the Board. airport developers and operators; Stricter environment & OUTLOOK safety norms and Terrorism are being considered as major The outlook for the airport sector remains positive. Air threats. Also, Airport Industry is highly Capital-intensive Traffic in India is growing at an unprecedented rate of Industry and it takes much longer term to recover the 17.5% for last 3 years. Govt. of India has promulgated first higher cost of capital, which has an impact on airport lease ever National Civil Aviation Policy for holistic growth of terms. This along with Regulatory hurdles are also threats Aviation in India. Now, Air travel is not limited to the well- to AAI. heeled only. With the implementation of Regional RISKS AND CONCERNS Connectivity Scheme - UDAN (Ude Desh Ka Aam Nagrik), Hazardous activities affecting safety, inadequate financial air connectivity at subsidized rates is being provided at processes and IT back-up systems are amongst the most hitherto unserved/ underserved airports. To promote typical operational risks within the Aviation industry. rapid expansion of airport capacity, Govt. of India has Other Operational risks identified include potential announced NABH Nirman initiative in the Budget 2018. degradation of service delivery standards, unforeseen At present, in aggregate, AAI airports have the capacity to disruptions to flow management, maintenance handle 15.5 crore passengers per year. In the financial year challenges to aging facilities. Further, Strategic risks like 2017-18, AAI airports handled 13.6 crore passengers. As a decisions related to pricing, development of airport part of the NABH Nirman airport capacity expansion infrastructure (either new airports or expansion of programme, the Government of India has proposed to existing airports), finding new products or markets, increase the capacity of airports by 4 to 5 times to handle a entering into JV's, alliance decisions may affect an billion passenger trips per year over the next 10 to 15 enterprise's ability to decide for itself and positioning years. To meet the demand, AAI has embarked upon a which will affect future operations decisions. Capital Expenditure (CAPEX) plan of ` 20,000 crore in next Compliance risks regard the adherence with external 4 years for development/ modernization/ upgradation of regulations and legislations, and any non-compliance terminal buildings of AAI airports in the country including may lead to heavy penalties and above all loss of Calicut, Port Blair, Agartala, Guwahati, Chennai, Lucknow, reputation. Also breach of contract, even though Dehradun, Jaipur, Srinagar, Tiruchirapalli, Pune, Patna, unintentionally, may bring legal consequences impacting Jabalpur, Vijayawada, Leh, Agra and Kolhapur. AAI. Further, AAI's operations are exposed to a variety of Development/ upgradation of airports is a continuous financial risks too like credit risk, liquidity risk, interest rate process and is undertaken by Airports Authority of India risk and foreign currency risk. (AAI) from time to time depending on the availability of AAI understands the significance of risk management and land, commercial viability, socio-economic its criticality for organization's success and business considerations, traffic demand/ willingness of airlines to continuity. Thus, in AAI the Risk Management has been operate to/from such airports. Total CAPEX of ` 100000 embedded in each function to ensure its effective crore is planned in airport sector in next 5 years. The implementation. Furthermore, the decisions at every level environment in which AAI operates is dynamic and including Board level are taken considering the risk changing and AAI would be able to respond to changes in involved. Also, Audit function reports the efficacy of risk the environment. management controls which helps the management in INITIATIVES / ACHIEVEMENTS OF VARIOUS improving the measures required to be taken in this DIRECTORATES regard. Air Navigation Services INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY AAI is committed to create highest standards of ANS AAI has an internal control system commensurate with Infrastructure without compromising passenger safety. the size, scale and complexity of its operations. The Keeping the above objective in mind, AAI has modernized organisation maintains all its records in SAP system and CNS/ATM Infrastructure as mentioned below: the workflow and approvals are routed through SAP. I. ATFM and Radar Networking The internal audit department monitors and evaluates the 1. Air Traffic Flow Management System: efficacy and adequacy of internal control system in the In the global aviation industry, air traffic demand organisation, its compliance with operating systems, is growing at an exponential rate and will double, accounting procedures and the policies at all locations. triple in a decade ahead. To balance the demand Based on the report of internal audit function, the airports and capacity, AAI is installing Central-Air Traffic undertake corrective action in their respective areas and Flow Management System for most efficient

32 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

operations. This system can provide tools to is replaced with ASR-MSSR so as to improve assist planning in Strategic, Pre-tactical & Tactical the approach control service in Mangalore phase of flight and provide advisories to initiate TMA and for enhanced route surveillance Traffic management initiatives to balance the coverage in the western coast. Demand versus capacity. Historical analysis of • ASR-MSSR are installed in Amritsar, Lucknow existing traffic will help for future planning. and Imphal in order to enhance the 2. Networking of Radars with ATM Automation surveillance coverage in these areas. System: • As of now there are two ASR-MSSR in the Networking of radars and integrated radar data North-East Region(in Guwahati and in processing to provide uniform radar data to the Imphal). Controllers. This will help in achieving seamless • New MSSRs are under procurement for radar surveillance separation and enhanced Air installation in Aurangabad and Bikaner for Traffic management. With advanced surveillance increasing the route surveillance coverage in coverage, AAI has implemented Upper Space these areas. The stand-alone MSSR in Harmonization at Chennai & Kolkata which will Berhampur, which has served its life-time, is be followed at Delhi and Mumbai in next phase. also being replaced with a new system. The gaps in the surveillance coverage will be filled with the installation of new Radars. This will b) Advanced Surface Movement and Guidance provide seamless monitoring of air traffic over Control System: Indian airspace and enhance safety of air State-of-the-art Advanced Surface Movement passengers. Guidance Control System (A-SMGCS) has been II. Enhancement of Navigational Aids infrastructure: installed and commissioned in 5 airports (Lucknow, Jaipur, Amritsar, Guwahati and AAI is maintaining vast navigational infrastructure of Ahmedabad) through M/s SAAB USA. The 66 Instrument Landing System (ILS), 97 very high system represents the latest in surveillance, frequency OMNI range (VORs) & 166 Distance conflict alerting and display technology for measuring equipment's (DMEs) to facilitate aircraft to airport surface applications. fly under complete navigational guidance over Indian airspace. AAI expanded navigational equipment base • The system combines the primary by replacing & installing at new location 05 numbers surveillance of an X-Band Surface Movement of instrument landing systems, 7 Nos. of DME and 05 Radar (SMR) with secondary surveillance Nos. of DVOR in year of 2017-18, which will enhance p r o v i d e d b y t r a n s p o n d e r the safety of landing aircrafts at airports. AAI is further multilateration(MLAT) and ADS-B, along in process of procurement and installation of 27 Nos. with established terminal area surveillance of DVOR, 31 Nos. of DME and 20 Nos. of ILS in year of Radars to provide pictorial display to Air 2018-19, additionally to enhance the operational Traffic Controller of all movements in the efficiency and safety at airports and en-route. aircraft maneuvering area, including runways, taxiways and apron. III. Surveillance Enhancement over Indian air space and Airports: • A-SMGCS helps ATC to monitor and control aircraft and vehicular movements during a) Radar Systems: low visibility or in the areas which are not • With a view to enhancing safety of air directly visible from the Control Tower. passengers AAI has undertaken to enhance • The clear and concise Controller displays and the surveillance coverage of the entire advanced conflict detection and alerting Indian airspace with Radar in a phased functions afford maximum safety on the manner. surface of large and/or congested airports. • New ASR-MSSR are installed in Chennai and • A-SMGCS combined with Cat-III-B ILS Guwahati for replacement of the existing ensures safe landing of aircraft during fog in ASR-MSSR which have served their life-time. winter, during near zero visibility. • Additional ASR-MSSR have been installed in • AAI is planning to procure a ASMGCS for Delhi and Mumbai to enhance the second Cochin & Bhubaneswar Airport in year 2018- level of surveillance coverage and maintain 19. the traffic separation on Radar, in view of the significant increase in traffic in Delhi and c) Automatic Dependent Surveillance-Broadcast Mumbai. (ADS-B): • The existing stand-alone MSSR in Mangalore AAI has inducted new low cost Surveillance

23rd Annual Report 2017-18 33 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Technology i.e. ADS-B using which Ground operational efficiency reducing fuel burns and stations can track the Aircraft location which is providing capacity enhancement. Vertical computed by aircraft based on the GPS satellites navigation will increase aviation safety. GAGAN and broadcasted along with other important system has certified for RNP0.1 (enroute) and parameters. ADS-B Ground system has been APVI (Approach) with vertical guidance successfully installed at 21 Airports and operations w.e.f. April 2015. effectively being used to enhance the Major achievement in GAGAN Programme Surveillance of ADS-B equipped aircrafts. AAI is during 2017-18 : going to install 10 numbers of additional ADS-B 1. AAI coordinated and conducted various Ground stations to enhance Surveillance meetings with airlines to forward-fit their coverage. fleet for utilization of GAGAN in order to IV. ATC Automation System meet GAGAN mandate issued by DGCA a) AAI has installed State of the Art ATC automation scheduled to be effective from 1st January system at Kolkata airport which is having 2019. advanced features to enhance ATC Operation 2. AAI has established required software tools efficiency & safety of air Passengers. Upper space to develop GAGAN based approach harmonization at Kolkata airport has been procedures. Currently 12 LPV Instrument completed to provide more Surveillance. Approach procedures (IAP) have been b) AAI is going to replace Automation system at developed and are in simulator/flight Delhi Airport which is having a latest features to validation process. AAI has planned to avoid air traffic conflicts & enhance Air safety of develop 48 LPV IAP procedures by December passengers. 2018. c) AAI has also introduced IP-Based Voice 3. In order to add geographical redundancy in Communication system at Kolkata to enhance GAGAN system, AAI in coordination with the functional capability of integrating Voice IP system integrator has established third Radio Transmitter and Receivers for better Indian Master Control Centre (INMCC) in flexibility and efficient operations. The same Nangloi, Delhi. type of VCCS system will be installed in the new 4. In order to provide redundancy in space up-coming ATC Centre at IGIA Airport. In future segment, AAI in coordination with ISRO and A A I w i l l r e p l a c e 4 6 e x i s t i n g V o i c e system integrator has taken up the task of Communication system. integration of GSAT-15 with existing V. HF Receivers to resolve the issue of HF Radio certified GAGAN system. Standalone Site coverage in Mumbai airspace Acceptance Testing (SAT) of GSAT-15 • In the ICAO AFI-APAC-MID of Air Traffic integration with Delhi INMCC has been management Special Co-ordination meeting completed. held in Mumbai between 19th and 20th January 5. AAI planned to establish a GAGAN R&D 2017, the issue of HF Radio coverage in the centre at Ahmedabad for Ionospheric Mumbai Oceanic Control was raised by stake- Analysis using GPS and GAGAN data. holders. 6. AAI organized an International workshop on • To resolve the issue of poor HF coverage, AAI is GAGAN on 15th and 16th March 2018 at India planning to install HF Receivers in Mumbai, Habitat Center, New Delhi to encourage Chennai and Trivandrum. SAARC and Southeast Asian nations to use VI. India Transition Plan From Ground Based To GAGAN services in their Nation. The Satellite Based Navigation workshop was attended by various SBAS stakeholders from different countries. a) GPS Aided Geo Augmented Navigation (GAGAN): Airports Authority of India in 7. Based on the discussions during the GAGAN coordination with ISRO has implemented GPS workshop, Nepal, and Maldives was Aided Geo Augmented Navigation (GAGAN) coordinated to provide their plan related to which provides very precise navigation to all over Implementation of SBAS. The countries are Indian airspace and capable of providing positive for implementation of GAGAN in seamless Navigation Service to neighbouring their respective nation through a MoU. countries. GAGAN provides vertical guidance to 8. India attended Joint ACAC/ICAO Middle East select runway ends thereby increasing Regional office workshop on GNSS during

34 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

November 2017. AAI provided a MoU ADS-B out data broadcasted by Aircraft on regular document to Arab Civil Aviation basis to provide complete surveillance of overall Commission (ACAC) containing the Indian FIRs coverage, including oceanic region, requirement for establishment of Indian without the need for installing ground stations. This Reference Stations (INRES) in their country. will enable real-time delivery of ADS-B information to 9. AAI in coordination with Indian National (ATC) to support aircraft Centre for Ocean Information Services surveillance across all Indian FIRs. (INCOIS) implemented the concept of VII. AAI has taken initiative in inducting new GAGAN Messages Service (GMS). Various Technology to handle increase in Air-Traffic: meetings were conducted with other 1. Inducting of Mobile ATC Tower stakeholders e.g. Snow and Avalanche Study AAI is procuring 8 nos. of Mobile ATC Tower to Establishment (SASE) and Indian p r o v i d e a i r c o n n e c t i v i t y t o r e m o t e Metrological Department (IMD) for underdeveloped Airport under RCS Scheme. The utilization of GMS to provide specific, mobile ATC tower was designed to provide reliable alert messages to various users and flexible and rapidly operational air traffic control demonstrated the proof of concept of services complying with high performances GAGAN Message Services using a simulator. requirements. The mobile ATC tower can be 10. AAI in coordination with KPMG funded by elevated up to 8 meters and even more. USTDA under United States Aviation Transportable by air, sea and road, the same may Cooperation Programme has carried out a be rapidly set up and its deployment is study on cost-benefit analysis for utilization completely autonomous. The mobile tower of GAGAN by airlines. The report reflects the concept relies on a scissors lift - mounted cabin substantial benefits to airlines in terms of system integrated to a trailer. The tower is fuel saving, reduced carbon emission and equipped with a power supply generator that optimum utilization of airspace etc. provides an autonomous power supply of tower b) Ground Based Augmentation System (GBAS) : deployment and operating mode operations. The Ground Based Augmentation System (GBAS) The control cabin is equipped with all the augments GPS to provide precise navigation service equipment required to provide ATC services: for an airport and surrounding airspace using a Very radio communication system, antennas system, High Frequency (VHF) data link. GBAS supports meteorological station and display equipment, navigation and precision approach operations within time distribution system, recorders, as well as all 23 nautical miles from the GBAS reference point, the accessories required for controllers comfort. typically located on the airport within three nautical 2. Remote Control Tower miles of all supported runways, resulting in approach Remote and virtual tower (RVT) is a new concept guidance within 20 nautical miles of runway where the air traffic service (ATS) at an airport is thresholds. performed somewhere else than in the local Major achievement in GBAS Programme during control tower. 2017-18 : Remote tower solutions provide a smarter Site Acceptance Test (SAT) of the new GBAS approach to air traffic control by digitizing and equipment installed at Chennai was completed in integrating airport functions whether that November 2017. System is currently under testing airport is an international hub, a small regional and data collection. AAI is coordinating for GLS airport or a new airport. procedure development, simulator and flight trials of When new runways and terminals were built at GLS procedures. airports it decreased the efficiency of the current After certification & commissioning, a single system is working towers mainly for the controllers view. able to support multiple runways/approaches at Replacing concrete towers with remote towers Chennai airport. The individual procedures will be opens a range of possibilities for service published as GBAS Landing System (GLS) optimization and cost savings. approaches. Each approach will have a unique Remote Tower made it possible to control air channel number identifier. traffic without a physical control tower through a c) Space based ADS-B Data services better use of technologies and procedures. Through Space based ADS-B Technology, the stations in India (Mumbai & Chennai) will receive the

23rd Annual Report 2017-18 35 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

CNS-OM Within Airports Authority of India, CNS Department is responsible for Maintenance Management of Communication, Navigation, Surveillance, ATM Automation Systems and ancillary Systems for providing Air Navigation services over continental and oceanic airspace. The objective is to have high availability of CNS/ATM facilities for operational use for safe, secure and cost effective air navigation services. Followings have been the major achievement of the CNS-OM Dte. during FY 2017-18:- (a) Serviceability & Availability Statistics of Air Navigation facilities from Apr'17 to Mar'18:-

Serviceability/Availability Statistics for ANS Facilities 99.99% 99.98% 99.98% 99.98% 99.97% 99.96% 99.95%

100.05% 99.92% 99.91% 99.90% 99.89%

100.00% 99.87%

99.95% 99.84% 99.80% 99.90% 99.76% 99.73% 99.72% 99.85% 99.72% 99.71% 99.69% 99.80% 99.68% 99.75%

99.70% 99.59% 99.65% Percentage 99.60% 99.55% 99.40% 99.50% 99.40% 99.45% 99.40% 99.35% 99.30% Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Year Serviceability Availability

Average serviceability of ANS facilities for the period from 1st April, 2017 to 31th Mar 2018 is 99.97 % and Availability is 99.73%. This serviceability and availability of is at par with other leading Air Navigation Service Provider in world. For Performance Evaluation, Serviceability & Availability of ANS facilities operational at various stations is monitored as per details given below:-

Navigation Surveillance Communication Gagan ATM Automation systems ILS 66 ARSR 02 VHF Tx/Rx 729 INMCC 03 44 CVOR/DVOR 96 ASR 17 HF Tx/Rx 54 INLUS 03 IATS Simulator -5 DME(HP) 98 MSSR 31 AMSS/AMHS 33 INRES 15 DME(LP) 67 ASMGCS 11 DATIS 49 Locator 11 ADS/CPDLC 04 DSCN 71 NDB 49 ADS-B 21 DVR 82 VCCS 47 ASBS 15 RCAG 24 (b) Air Calibration of Navigational Aids: Following number of Navigational Aids have been calibrated from 01/04/2017 to 31/03/2018:-

Sl. No. Facility Numbers 1 ILS 59 2 DVOR/DME 30

36 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

(c) Human resource training: Control Centre, Cargo complexes, AFL Masts, • In-Country Training National Flag Masts etc. and Siting of ILS, Total number of 1987 CNS personnel have VOR/DME, RADAR etc. The details are given undergone developmental and continuance below: training on various CNS/ATM Systems at CATC and RTC'S during the period Station Subject 01/04/2017 to 31/03/2018 on various operational CNS/ATM systems to meet GUWAHATI Technical Block cum Control Tower DGCA/CAR requirement for trained CNS for Revised Height, SOW for New manpower. Taxi & Extension of Apron • Foreign Training on CNS-ATM Systems:- KHAJURAHO ATC Tower cum Technical Block 53 CNS executives have been imparted CHENNAI For New Terminal Building & Apron Foreign Factory Training for maintenance of Flood Lights, SITC of HF RX CNS-ATM system: Antenna-NOC DELHI Delhi ELDIS RADAR Training Number of Executives trained DIMAPUR Flag mast of national flag DATIS 10 KANCHIPURAM New Proposed Site for DVOR AIS System Administration in Italy 4 AGARTALA Integrated Terminal Building- NOC EMACS System in Italy 6 UDAIPUR New Proposed Site for DVOR DVR System in Austria 14 RAJAMUNDRY Impact of A/c A321 on DVOR ILS System in Norway 7 performance DVOR(MOPIENS) in Seoul, 12 TRIVANDRUM SITC of HF Receiver Antenna NOC/ South Korea Revised Height, DVOR Replacement, New Fire Station Tower Height/ (d) Corporate Social Responsibility Revised Height As a Corporate Social Responsibility (CSR) SIKANDRABAD DVOR Replacement initiative, industrial/summer training was imparted to 1228 Graduate engineering students CHILARKI DVOR Replacement from Electronics and Allied engineering branches BELGAVI Simulation of ILS RWY26 for from various prestigious Institutes/Colleges at Hump on RWY various Regional Training Centers, CATC and PATNA Proposed Control Tower - Technical other airports. Block , Relocation of Site & Site (e) Impact Assessment and Siting criteria by CNS selection of DVOR Simulation tool EMACS JABALPUR DVOR Replacement EMACS, a computer modelling tool, is used for simulation studies. This tool is also used for the GAYA Construction of Technical Block siting of CNS facilities. Basically, EMACS is a set of cum Control Tower, Translocation of DVOR validated electromagnetic 3D modeling and simulation tools, capable of coping with EMC MUMBAI Replacement of ILS RWY27 (Electro Magnetic Compatibility) issues and EMI HUBALI For New ILS Site (Electro Magnetic Interference) problems in VIZAG Replacement of DVOR airport and air navigation site scenarios. The BIKANER Proposed Site for MSSR Site at LUNKA-2 modeling functionality (including terrain models, obstacles, interfering system, ground AURANGABAD Site selection of MSSR & Change in and airborne nav-aid equipment characteristics Pedestal Height of RADAR etc.) allows an expert EMACS user to model the CHANDIGARH New LLZ Location w.r.t DVOR & real propagation phenomena taking place within Old Terminal Building a complex e.m. airport scenario, where signals KOLKATA Simulation of DVOR w.r.t proposed (VOR, DME, ILS, ATC Radar, GPS systems) Taxiway F , Simulation for Night interfere with artificial or natural obstructions. Parking Apron Bay & Ground mounted solar panel system Last year the EMACS section of CNS-OM Directorate has done a remarkable job by doing BARAPANI Site Selection For DVOR simulation studies for proposed ATC Tower, VIJAYAWADA DG stack chimney Technical buildings, Terminal buildings, Fire BENGALURU Impact of Barricading on LLZ RWY09

23rd Annual Report 2017-18 37 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

(f) Performance of Automation Section (iv) Permanent Commissioning of 29 ATC (i) Work has been awarded for upgradation of Automation Systems have been achieved by Tower Automation System at 09 Airports for AAI after the commissioning work has been creation of: handed over by DGCA at Kolkata, Ahmedabad, Guwahati, Mangalore, • Lower area control centres (LACC) at Lucknow, Amritsar, Calicut, Coimbatore, Lucknow, Jaipur, Amritsar, Agartala, Bhopal, Imphal, Vadodara, Rajahmundry, Patna, Bhubaneswar, and Cochin; Bhavnagar, Dehradun, Udaipur, Raipur, • Approach control centres at Trichy Gondia, Tirupati, Hubli, Vijaywada, Gaya, and Imphal airports. Bhuntar, Ranchi, Surat, Aurangabad, (ii) C o m p l e t e d M u m b a i A u t o m a t i o n Khajuraho, Bhubaneshwar, Varanasi, Patna. Enhancement for additional positions of (v) A A I I n - h o u s e d e v e l o p e d A i r p o r t Oceanic Control Center, Provision of Collaboration Decision Making (A-CDM) processing of MET Data in GRIB2 format system installation at Chennai and instead of GRIB1, Integration of ADS-B upgradation of Mumbai ACDM system has system and for Relay of MET data from ADS- been undertaken which will provide all C reports generated by Aircrafts to MET stakeholders accurate, timely and relevant department. information to improve operational (iii) Automation systems at Mumbai, Delhi, efficiency, ensuring the best possible use of Chennai and Kolkata have been covered airport infrastructure and resources to the under the maintenance support contract benefit of all stakeholders. with OEMs.

(g) Performance of Communication Section:

S. No. Subject Descriptions 1. RCAG • Mangalore Hubli RCAG has been commissioned on 25th Jan 2018. • RCAG implementation at Jaipur and Bikaner through SITII VCS (IP based) and their integration with Schmid VCS at old Delhi in under progress for RNP-2 Connectivity between Delhi and Mumbai and to provide VHF coverage upto TIGER/VIKIT Point. • PO is likely to be issued in May 2018. 2. VCS • Lower ACC at Amritsar has been commissioned in the month of Nov, 2017. 3. DSCN • Implementation of Jaipur and Lucknow DSCN link for transportation of ADS-B data for integration with New Indra Automation System at New ACC/TBB Building, IGIA, New Delhi. • Implementation of ADS-B data from Trichy Airport to integration with Indra Automation System at Trivandrum Airport. • Standby Frequency of OCC has been successfully implemented through DSCN for the operation of Chennai-Portblair RCAG for Chennai OCC facility. 4. Online Flight Plan • Purchase order has been issued to M/s ECIL on 1st Nov, 2017 for execution of Online Management Flight Plan Management System as per Para 16.d & 24.a. of National Civil Aviation System(OFPL) Policy, 2016 (NCAP-2016), to implement a web based platform to facilitate Helicopter & seaplane operations without prior ATC clearance in airspace below 5000 feet . 5. Up gradation of • Upgrade of AAI, AIS/AIM Automation system at CHQ by OEM, M/s IDS Italy, has been AIS/AIM system done. • M/S IDS has supplied and installed the Hardware and Software and has upgraded the AIM database from AIXM 4.5 to AIXM 5.1. The data entry work by AIS section is under progress. 6. AMSS • In order to resolve the obsolescence issues of old UNIX based AMSS, new AMSS Replacement Plan Software has been developed on LINUX platform through indigenous efforts by AAI CNS personnel. Replacement of old items with latest available COTS hardware and Site Acceptance Testing at Varanasi has been done successfully. 7. HF Receiver • To cover south Mumbai routes and to improve HF coverage in Mumbai oceanic Region. Purchase order has been issued for Supply, Installation, Testing and Commissioning (SITC) for Quantity 12 HF receivers (Quantity 4 each HF Rx has been installed at Mumbai Chennai and Trivandrum). HF Antenna, HF Receivers and accessories has been installed at the sites. Site Acceptance Test is under process.

38 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. No. Subject Descriptions 8. DVR Systems • Indigenous integration efforts for 08 DVR systems for urgent operational requirement for RCS Airports namely Bilaspur, Ambikapur, Jagadalpur, Jeypore, Utkela and Neyveli by using available Retia software and Recording Cards. • For Regional Connectivity Scheme (RCS) Airports in 1st phase namely Burnpur, Rourkela, Hosur, Jamshedpur, Mithapur (Dwarka), Raigarh, Vidyanagar, Kadapa. Purchase order has been issued on 20 July 2017, DVR equipment has been supplied and under installation. • For improvement in coordination between AAI and Defence ATC units at Civil Enclaves, action has been initiated for procurement of DVR Equipments for Surface Movement Control (SMC) units to be established by AAI at Civil Enclaves. 9. Procurement of S. Communication Qty. Remarks Com Facilities No. Facility based on life 1 VCS Systems 47 47 Airports (46 Replacement + 1 additional cycle of system requirement) Including integrated RCAG circuits. and other 2 HF Transmitters 31 Procurement is in progress. PDC Dec, 2018 requirements 3 HF Transceiver 33 Procurement is in progress. PDC Dec, 2018 4 HF Receivers 48 Procurement is in progress. PDC Dec, 2018 5 DVR Equipment 43 Procurement is in progress. PDC 31 Dec 2018 15 For Regional Connectivity Scheme (RCS) Airports in 2nd phase, Requirements of Qty. 15 DVR equipment has been projected to CNS-P Dte. for procurement. 07 Requirement of Qty. 07 DVR equipment for Surface Movement Control (SMC) units to be established by AAI at Civil Enclaves for Goa, Vishakhapatnam, Port Blair, Pune, Chandigarh, Jammu and Srinagar Airports has been projected to CNS-P Dte. for procurement action. 6 DATIS Equipment 18 Procurement is in progress. PDC 31 Dec 2018 7 VHF (IP Based) 585 • Procurement of MARC Server for the TX/RX, PAE maintenance of VHF IP Radios associated with Delhi & Kolkata UAH plan has been initiated. • Procurement of Qty-585 • VHF TX/RX (including 300 replacement of OTE, new frequencies & RCS stations) is under progress. 10 Request For • Request For Proposal (RFP) is invited for getting competitive tariff plans on PAN India Proposal (RFP) for Basis from mobile service providers. RFP is meant to curtail direct and indirect cost of single mobile AAI through competitive bidding and reduction in administrative work while service provider ensuring same standard of service to all AAI users covered under mobile phone on PAN India policy. Basis to get • The project is at evaluation stage before opening of financial bid under reverse competitive tariff auction. plans and hassle free uniform mobile phone services for AAI. 11 Training • Special NON-PLI course on AMS was conducted to enhance HFRT proficient manpower at Mumbai & Kolkata Jan-Feb2017 & Oct to Nov2017

23rd Annual Report 2017-18 39 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. No. Subject Descriptions 12 Certification of Documentation: ATS Personnel • Chapter 4 & 7 of MARC Part 4 (ASOs) • MSLPT Part 1 • MSLTP Part 2 • Aeronautical Station Circular 001/2017 to 005/2017 CATC • AMS HFRT Course curriculum has been reoriented as per Training Procedure Manual. • Class Room & Laboratory has been upgraded and certified by ED (CNS-OM) • Empanelment of Instructors & Evaluators. • Question Bank / Verification and Vetting • Hard copy & Soft copy of Instructor files • Soft copy & Hard copy of Trainee Log Book • Conduct of AMS HFRT course as per Training Procedure Manual 09/10/2017 to 11/10/2017. • Examination Record Keeping provisions are made as per guidelines made in MARC- Part 4, Training Procedure Manual of CATC. Aeronautical Stations: • On-the-Job training of ASOs and Unit Training Plan at stations have been streamlined as per MSLTP Part 1 & MSLTP Part 2. • HFRT Units have been upgraded with all necessary infrastructures • Relevant Annexures & Documents were made available in all HFRT positions as well as at RTCs • Standard Operating Procedures were formulated for Aeronautical Station operation. 13 IATS Successful commissioning of lines. 14 Leased Lines • Commissioning of links by Ms. Bharti Airtel Ltd for GAGAN project • Provision of dual link for surveillance data transportation iro Upper Area Harmonization of Chennai/Kolkata & IGI Airport Delhi. 15 AERADIO Documentation of Amended version of AERADIO has been completed and published in Feb 2017 & Dec 2017 Central Air Traffic Flow Management (C-ATFM): time. This delay on ground reduces the delay in air and Airports Authority of India has implemented an advanced hence greatly reduces the fuel consumption of airlines. state of art C-ATFM (Central ATFM) system called During the last year C-ATFM has successfully regulated "Sky-Flow". The C-ATFM system has started functioning about 50620 flights of 118051 planned flights, operating since April 2017. India joins USA, Europe, Australia, South at Delhi, Mumbai and Bengaluru Airports. The ATFM Africa, Brazil, Russia, Japan and as one of the few intervention has resulted in reduced airborne congestion countries that have implemented ATFM. and enhanced safety. The C-ATFM system is primarily meant to address the The C-ATFM system network architecture consists of a balancing of capacity against the demand to achieve Central Command and control Center (CCC) and various optimum utilization of the major resources viz., Airport, Flow Management Positions (FMP) placed at ATC units of Airspace and aircraft at every Indian airport where there is major airports across the country. a capacity constraint. The CCC was established in 2017 at Delhi along with FMPs The ATFM system balances air traffic demand with at six major ATC centers such as Delhi, Mumbai, Chennai, available airport capacity, by systematically adjusting the Kolkata, Bengaluru and Hyderabad. The C-ATFM system is flow of arrivals to a congested airport, for a precise now supported by additional 30 FMPs at various airports duration. The ATFM flow manager collaborates with all which also include eight defense airports The CCC is the stakeholders like airlines and airport operators and nodal center for ATFM implementation in India and implements ATFM regulations such as Ground Delay communicates with FMPs for ATFM measures Program (GDP) to ensure regulated flow of traffic at such implementation as and when necessary. constrained airport. During the previous year, C-ATFM has also handled special During the GDP, the aircraft which are bound for the events with aplomb. Some of the major events which led constrained airports, are allotted a time for departing from to severe air traffic congestion, such as main runway a departure airport and are held on ground till the allotted closure at Delhi airport, main runway blockage at Mumbai

40 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

airport and regular runway closures at Bengaluru airport, Objection Certificate (NOC) for height clearance to ensure have been efficiently managed by application of C-ATFM. that the build environment around the airports do not A dedicated ATFM team continuously keeps abreast of the adversely impact safe aircraft operations. entire dynamic air traffic situation across the country so as Development of NOCAS-2 to be able to anticipate any challenges or constraints and Airports Authority of India has developed the No be prepared to meet them. Objection Certificate Application System NOCAS version 2 Benefits by upgrading the earlier version of NOCAS for processing • ATFM is a planning tool which helps to deliver of NOC applications. NOCAS-2 is an online fully optimum air traffic to airports with least average automated, paperless and transparent system aimed at delay. fast and efficacious disposal of applications for height • With the availability of ATFM regulations, the airlines clearance. Applicants can file NOC application online at will be able to predict the extent of delay and thus their own convenience. After online processing of ensure predictability of operations. applications, NOC are also issued online to the applicants. Many of the NOC applications filed by the applicants will • The ATFM system will be able to assist and manage be auto settled by the system within minutes of filing the crisis situations such as airport runway closures, same. For auto settled case, system generated letter weather (floods, fog etc.). (without signature), stating that NOC from AAI is not • ATFM monitors the entire national airspace and air required and the reason thereof, is issued automatically. traffic. Analysis of such vast data provides Airspace There is a provision in NOCAS for the applicants to check and Airport Planners a valuable tool for future approximate top elevation admissible at a particular infrastructure planning. location for planning building height before filing online Initiative under 'Ease of Doing Business' application for NOC. All the NOCs issued are available for Government of India vide GSR751 (E) has entrusted the viewing in the public domain in the NOCAS website. responsibility to Airports Authority of India to issue No NOC cases received from (1st April 2017 to 31st March 2018)

NOC Delhi Mumbai Kolkata Chennai Guwahati Hyderabad Bengaluru Ahmedabad Nagpur Total Centre Building 1044 5082 1575 1837 223 721 640 620 444 12,272 Mast 17257 16039 10851 9757 3125 2555 3173 947 560 67,898 Total 18301 21121 12426 11954 3348 3276 3813 1567 1004 80,170

Building cases received from 1st April 2017 to 31st march 2018

5% 5% 26% 4% WEST Chennai 5% Bangalore Delhi

Ahmedabad EAST 8%

Guwahati 2% Hyderabad SOUTH 11% 6% Kolkata 3%

NORTH_EAST 2% NORTH Mumbai

3% Nagpur 4% 16%

23rd Annual Report 2017-18 41 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

BUILDING CASES RECEIVED & CASES DISPOSED OFF COMPARISION CHART 3500 3153

3000 2905

2500 1929 1785 2000 1405 1321

1500 1037 1000 721 682 1000 664 623 619 675 620 640 432 422 444 403 380 372 358 350 136 266 271 500 223

0

Delhi EAST WEST Chennai Kolkata Mumbai Nagpur NORTH SOUTH Guwahati Bangalore Hyderabad Ahmedabad NORTH_EAST Cases Received TOTAL DISPOSED OFF

Single window clearance for Buildings/Structures telecom operators and wireless users, the SACFA and NOCAS website of AAI is being integrated with the Online NOCAS Servers have been integrated. The applicants are Building Permission System (OBPS) of Urban Local Bodies required to apply to SACFA Secretariat, WPC wing (DOT) (ULBs) of different states for Single window clearance of only. Applicants are not required to apply to AAI Construction permits. AAI has integrated NOCAS with the separately. The requisite data, is fetched from SACFA to Online Building Permission System (OBPS) of 10 Urban NOCAS automatically. After processing, AAI issues online Local Bodies of seven States and is in various stages of NOC for height clearance to SACFA. The individual SACFA integration with OBPS of another seven States. application at the SACFA server is also automatically updated with NOC height data as cleared by AAI. Single window clearance for telecom Masts For effective implementation of Single Window clearance and to avoid duplicate filing of applications by the

SACFA MAST CASES RECEIVED FROM PIE CHART OF SACFA MAST CASES STATUS APRIL 2017 TO MARCH 2018 WISE (APRIL 2017 TO MARCH 2018)

Bangalore WEST 1 5% 4% Hyderabad NORTH_EAST Nagpur 4% 4% WEST 2 Ahmedabad 1% 2% 1%

WEST 3% REJECTED NORTH IN PROCESS 14% 24% 25% 55% ISSUED AUTO SETTELED 28%

SOUTH EAST 14% 16%

42 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Colour Coded Zoning Maps (CCZM) the Solid Waste Management comprising end to end solution starting from collection, segregation, CCZM have been prepared based on the latitude & transportation, treatment till its final disposal longitude of the area in respect of civil aerodromes which initially at Kolkata, Bhubaneswar, Trivandrum, indicate through different colour coded grids, the Coimbatore and Varanasi. After successful permissible heights in the areas around the airport, falling implementation of project at these airports other within the radius not exceeding twenty kilometers from airports will also be considered to set-up the Aerodrome Reference Point. Local bodies can comprehensive plan for solid waste management. sanction building plans without AAI NOC if the height 4) AAI in its constant efforts to improve passenger service requested is below Colour Coded Zoning Maps (CCZM) excellence, operational efficiency and to realize grid height. AAI has developed Colour Coded Zoning greater revenue growth had launched project Maps (CCZM) for 31 major cities of India under 'ease of "DISHA" with support of Boston Consulting Group doing business'. These cities are Ahmedabad, Amritsar, (BCG) at 10 airports handling over 50 million passengers annually, namely Chennai, Kolkata, Pune, A u r a n g a b a d , A g a r t a l a , B a n g a l o r e , B h o p a l , Goa, Trivandrum, Coimbatore, Bhubaneswar, Bhubaneshwar, Calicut, Chennai, Cochin, Coimbatore, Varanasi, Lucknow and Guwahati. Delhi, Dimapur, Guwahati, Hyderabad and Shamshabad, Based on the successful implementation of Project Indore, Jaipur, Kolkata, Kota, Lucknow, Madurai, DISHA, Phase -I, similar initiatives have further been Mangalore, Mumbai and Navi Mumbai, Nagpur, Patna, implemented at other 12 major airports namely Trichy, Puducherry, Ranchi, Surat, Thiruvananthapuram, Calicut, Mangalore, Vizag, Srinagar, Amritsar, Jaipur, Vijayawada and Vadodara. Local Municipal bodies are Patna, Bagdogra, Raipur, Ahmedabad, Agartala under empowered to issue NOC for heights below CCZM the mentorship of Phase-I airports. without referring to AAI. These CCZMs have been 5) AAI in its constant efforts to enhance the capacity of uploaded in the AAI website. airports to accommodate more flights, the operational hours of Indore, Surat, Varanasi, Guwahati Operations and Patna airports have been increased to 24 hours. 1) In order to maintain the airports to be cleanest in the Planning world, Airports Authority of India outsourced the Up- keeping services of Airports Terminal, City side area 1. New Terminal Building Ph I inaugurated at and Operational area through MESS/ESS contracts GORAKHPUR AIRPORT by Hon'ble CM of UP. awarded to specialised agencies. To ensure the high 2. Expansion and modification of Terminal Building cleaning standards at airports, the agencies are being completed at a cost of ` 75 crore at , selected based on Quality cum Cost Based Selection(QCBS) tender process inaugurated by Hon'ble Minister of Civil Aviation in 2) The third-party assessment of cleaning standards and Jun 2017. passenger facilities is also being carried out by Quality 3. Expansion and modification of Terminal Building and Council of India(QCI), an independent autonomous Extension and Strengthening of runway completed at body set-up by Govt. of India. Based on assessment a cost of `141.87 crore at BELAGAVI AIRPORT, report further improvement in service standards is inaugurated in Sept 2017. being done for making the airport cleanest in the world. 4. Development of HUBBALI AIRPORT including New In 1st phase QCI has carried out the Assessment of Terminal Building and Extension and strengthening Terminal Building cleaning standards/ facilities at 20 of runway completed at a cost of ` 141.41 crore AAI airports namely Chennai, Kolkatta, Ahmedabad, Inaugurated in Dec 2017. Goa, Pune, Lucknow, Jaipur, Guwahati, Calicut, 5. Runway resurfacing work and construction of, parallel B h u b a n e s w a r , S r i n a g a r , C o i m b a t o r e , Vishakhapatnam, Patna, Mangalore, Varanasi Taxitrack and a new Arrival block completed at Amritsar, Bagdogra, Indore and Chandigarh. TRIVANDRUM AIRPORT. In 2nd phase QCI is being engaged to carry out the 6. Strengthening of runway and taxiway at CALICUT assessment of 34 Airports on the same parameters. AIRPORT completed at a cost ` 55.42 crore. The assessment score / Rating will be considered to select the airport for Clean & Safe Airport award in 7. Runway and apron works completed at TEZU three categories based on passenger movements at AIRPORT. Airport is licensed and ready to be airports. operationalised with renovated Old Terminal 3) In order to mitigate the environmental impact of waste Building. generated at airports, AAI has invited Express of 8. ready for operationalization. Interest (EOI) from specialized agencies to establish 9. inaugurated in Oct 2017.

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10. Commissioning of ILS Category IIIB at KOLKATA and 31.76 lakh units in the month of March'2018. AAI has AMRITSAR airports. generated 368.87 lakh units till March'2018 and 11. Expansion of Security Hold Area and face lifting reduced approximately 330 Metric Ton of Carbon completed in AGARTALA AIRPORT for ease of emission. Total 5.49 MWp capacity roof top & ground passenger movement. mounted Solar Plant installation works are in progress at Airports. 12. Resurfacing of runway, taxiway and apron. Completed at a cost of ` 20.87 Cr on 31.05.2017 at 14. Water Audit at Airports : . Water audit at 12 Airports/Premises including allied 13. Energy Conservation Measures:- buildings has been completed. The observations / recommendations are being implemented as per AAI is very keen towards energy saving and short term & long term measures in phased manner. environment and taken many steps to save energy and green environment for the better future of the RCS Cell coming generation. New Civil Aviation Policy-2016 is The primary objective of RCS- UDAN is to facilitate / also very firm on the energy conservation planning stimulate regional air connectivity by making it and future friendly green & clean environment. In line affordable. Promoting affordability of regional air with the NCAP and the responsibility towards the connectivity is envisioned under RCS by supporting airline society to make the environment clean for future operators through (1) concessions by Central generation, AAI has mainly taken following steps - Government, State Governments (reference deemed to Energy Audit at Airports:- For Energy conservation include Union Territories as well, unless explicitly several measures have already been taken through specified otherwise) and airport operators to reduce the energy audit of electrical and mechanical installations cost of airline operations on regional routes / other at 56 airports by specialized energy audit agencies. support measures and (2) financial (viability gap funding Observations & recommendations are being or VGF) support to meet the gap, if any, between the cost implemented in phased manner as immediate of airline operations and expected revenues on such measures, short terms measures and long term routes. measures as per the schedule. I. Routes awarded under RCS - UDAN during the 1st Major initiatives taken to conserve the energy:- Round of Bidding • Improvement & maintaining of power factor Airports Authority of India (AAI), the implementing between 0.91 to 0.99 and getting incentives from agency, had issued Letter of Awards on 30/03/2017 SEB's. covering 27 proposals received under RCS-UDAN • Replacement of conventional light fittings with after completion of the first round of bidding. Key energy efficient LED light fittings. features of the proposals awarded by AAI include: • Installation of Solar power plants. • Selected Airline Operators: 5 (, Air • Measures taken up for energy conservation on Odisha, Deccan Air, Spicejet and Turbo Megha). recommendation of energy auditors after energy • Airports to be connected: 27 currently served audit at Airports, which includes various short term airports, 12 currently underserved airports and measures and long terms measures. 31 currently unserved airports (total of 70 • Some of the key measures are replacement of airports) will be connected. centrifugal type chillers with new energy efficient screw type chillers for HVAC system, provision of • Geographical spread: There is a good Variable Frequency Drive for Air handling units, geographical spread in the proposals: 24 airports Provision of APFC panel for improvement of Power in the western, 17 in north, 11 in south, 12 in east factor, using energy efficient pumps and motors and 6 in north-eastern regions are proposed to etc. be connected. 22 states and 2 Union Territories will be connected. Installation of Solar PV Plant at Airports:- • VGF Outflow: These proposals will require VGF AAI has also implemented the long term measures for of around ` 213 crore per annum and will provide energy conservation in terms of setting up the solar around 13 lakh seats per annum of which half will power plant for energy generation at various airports. be covered by airfare cap of ` 2500 for AAI has commissioned 30.15 MWp Solar Power Plant approximately one hour of flying. at Airports by which AAI is able to generate approx.

44 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

II. Progress of the 1st Round of Bidding under RCS- Specifications applicable on Non-RCS Routes as UDAN: 43 RCS Airports: part of Network Proposals under the Scheme. • Flights commenced from 28 RCS airports: • To encourage helicopter operations under the (Adampur, Agra*, Bhatinda, Bhavnagar*, Bikaner, Scheme, VGF Caps for Helicopters increased and Diu*, Gwalior*, Kadapa*, Jagdalpur, Jalgaon, upto10% of the estimated annual inflows in the Jamnagar*, Jaisalmer, Jharsuguda, Kandla, RCF earmarked for operations through Kanpur, Kolhapur, Ludhiana, Mundra, Mysore, helicopters. Further, all seats up to 13 passenger Nanded, Ozar(Nasik), Pathankot, Pondicherry*, seats for Helicopters shall be considered as RCS Porbandar*, Salem, Shimla, Shillong* and Seats and accordingly, VGF shall be provided. Vidyanagar). IV. Focusing Priority Areas to expand the Remote *These are 9 underserved airports, remaining 19 are unserved Area connectivity airports. • Priority Area(s)' shall mean the States of Jammu • No. of operational RCS airports from which and Kashmir, & Uttarakhand, flights yet to commence: 05 (Cooch Behar, North Eastern Region, Andaman and Nicobar Durgapur, Jamshedpur, Kullu, and Pantnagar). Islands and Lakshadweep Islands. • No. of RCS airports under up-gradation, slot • 'Priority RCS Route' shall mean an RCS Route in allocation, etc.: 10 (Ambikapur, Burnpur, which at least one of the origin and destination Bilaspur, Jeypore, Mithapur, Neyveli, Raigarh, airport is an RCS Airport located in Priority Rourkela, Solapur and Utkela). Area(s). RCS Airport satisfies definition of III. Key aspects considered under 2nd Round of RCS- Underserved Airport or Unserved Airport under UDAN covering Priority areas, operational the Scheme. 'Underserved Airport' shall mean flexibility, Helicopter operations, etc. any airport which is not having more than • Key Revisions made under RCS-UDAN-2 fourteen (14) scheduled commercial flight departures per week as per the latest flight • To provide enhanced connectivity and ease the schedule published by the DGCA on its website. formation of networks under the Scheme, routes with stage length less than 150 Kms for • Maximum Number of Flights for Priority RCS operations through fixed wing aircraft as RCS Routes: Number of RCS Flights/week with VGF, Routes accepted. Such routes permitted under shall be a minimum of three (3) and a maximum the Scheme and VGF calculated accordingly for of fourteen (14) departures per week from the Cat. 1A, 1, 2 & 3 of Fixed wing aircrafts. same RCS Airport. RCS Flights are operated on at least three (3) days of the week. • To provide comfort to airline operators for assured revenues/ possible network • Operations through Category-1A aircraft (with development and ensure sustainable operations passenger seats less than 9) will be permitted on RCS Routes, Exclusivity of operations continue only for Priority RCS Routes. to be for a period of 3 years. Selected Airline • Enhanced VGF Caps for operations through Operator may issue No-Objection Certificate Category-1 A and Category-1 Fixed-wing aircraft (NOC) to other airline operator(s) willing to for Priority RCS Routes. Further, the Airfare caps operate on the respective RCS Route. and VGF Caps have been specified for stage • To provide more flexibility to Selected Airline lengths less than 151 Km and Priority RCS Routes Operators (SAO), maximum number of flights / Category 1A aircraft. with VGF has been increased to 14 for Priority V. Routes awarded under RCS-UDAN-2 Areas and 7 departures for RCS Routes other than (i) Airports Authority of India (AAI), the Priority RCS Routes. Further, the SAOs can implementing agency, has issued Letter of anytime increase the number of flights on RCS Awards on 24/01/2018 to 15 Selected Airline Routes to any number but without provision of operators covering 86 proposals. notified concessions for such additional capacity. (ii) Outcome of Proposals awarded under UDAN-2 • To provide operational flexibility to Selected with comparative position under UDAN-1 are Airline Operators, no minimum performance given as under:

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Sl. No. Particulars UDAN-1 UDAN-2 Proposals awarded Proposals awarded 1. No. of Applicants 5 15 2. -Fixed Wing Aircrafts 27 65 -Helicopters 0 23 No. of Proposals received 27 88 3. No. of Routes involved 128 300 4. Proposals with No VGF 6 20 5. Proposals with VGF 21 68

(iii) Airports to be connected: Total 78 airports i.e., 36 Cargo currently served airports, 13 currently AAI Cargo Logistics & Allied Services Company Limited Underserved Airports and 29 currently Unserved (AAICLAS) is a wholly owned subsidiary of AAI which is Airports (25 distinct airports after removing the 4 managing the Air Cargo Operations at various AAI Airports overlapping airports from UDAN-1) will be in the country. The achievements of AAICLAS is given below:- connected. In addition, 31 helipads/ heliports I. Physical performance: will be connected through Helicopters in the Priority areas. A. Cargo tonnage handled at AAI managed airports: (Source: CPMS Dte. AAI) (iv) It is expected that the Fixed-wing aircrafts proposals will provide around 26.5 lakh RCS seats Sl. Year Tonnage % Increased per annum of which will be covered by airfare cap No. Handled (in MT) of ` 2500 for approximately one hour of flying. In 1. 2016-17 8,02,980 - addition, around 2 lakh RCS seats per annum are expected to be provided through Helicopter 2. 2017-18 9,15,353 13.99% operations. B. New Cargo Terminals commissioned during the VI. Progress of the 2nd Round of Bidding under RCS- year 2017-18:- UDAN: 67 RCS Airports • International Cargo Terminal(s) at Pune, • Flights commenced from RCS airports; 9 Vizag, Varanasiand Madurai Airports. (Allahabad*, Bhatinda*, Bikaner*, Hubli*, Jorhat*, • Common User Domestic Cargo Terminal(s) Kishangarh, Nasik, Pakyong & Tezpur*); atGuwahati, Trivandrum and Varanasi • Number of operational RCS airports from Airports. which flights are likely to commence by end C. Policy decisions taken and implemented of September, 2018; 11 (Cooch Behar*, Jalgaon, • AAICLAS has implemented the DOP duly Jaisalmer*, Kandla*, Kargil, Kolhapur, Kullu*, approved by its Board w.e.f. 01.07.2017. Lilabari*, Passighat, Porbandar* & Tezu); • AAICLAS has commenced the cargo billing • Number of RCS airports under up-gradation, under its name w.e.f. 01.08.2017 which is GST slot allocation, etc. 23 {Baldota(Koppal), compliant. Bareilly, Bokaro, Burnpur*, Chinyalisaur, • T w e n t y ( 2 0 ) N o s . o f A A I C L A S ' s Daparizo, , Gaucher, Hissar, Kannur, executives/non-executives were trained on Keshod, Moradabad, Pithoragarh, Rupsi, "Dangerous Goods Shravasti, Sholapur, Thanjavur, Tuting, Utterlai, • Regulations" (Basic course of Category 3 & 6) Vellore, Walong, Yinghiong, and Ziro (Bid to keep updated and as required by IATA. withdrawn)}. • AAICLAS has procured and placed 17 Nos. of • Number of Helipads/Heliports under Dual-Image x-ray screening machines at its upgradation;24 {Almora, Dharchula, Haldwani, cargo facilities at AAI Airports. Haridwar, Itanagar, Jiribam, Joshimath, Kasauli, II. Financial performance: Mandi, Manali, Moreh, Mussoorie, Nagaon, Nainital, Nathpa Jhakri, New Tehri, Parbung, Sl. Year Revenue Earned % Increased Ramnagar, Rampur, Sahashtradhara, Shimla No. (` in crore) (Annadale), Srinagar, Tamenglong and 1. 2016-17 294.36 - Thanlon}. * underserved airports. 2. 2017-18 347.17 17.88%

46 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

III. Facilitation to Cargo Trade / Users of Cargo upgradation has increased the throughput from Terminals: the existing I.T. System. - AAI has been able to convince the approving - AAI has made a policy to provide the space for a authority i.e. MoCA for increase of 5% in the least a 10 year lease to the operators of express cargo tariff at non-AERA airports for the period cargo freighters and express terminal for 2016-17 to 2020-21. developing the dedicated infrastructure to - In order to promote the pharma business from improve their operational efficiency. Chennai airport, Air-conditioning facility created - Created additional space for accommodating by converting one of the hall for Import Pharma more domestic airlines along with the existing and Old APEDA building for Export pharma, as an CUDCT at Chennai airport. interim measure. - The process of transfer of Assets to AAICLAS from - The up-gradation of the web-based on-line AAI and novation of commercial agreements existing I.T. System titled 'ICMS' of the Cargo Dte. initiated. has been agreed for interim/permanent - Re-introduction of Customer Satisfaction Index development to meet with the latest technology (CSI) at Chennai/Kolkata Airports and rating(s) and additional features such as Mobile- improved at both airports and continuing. The application for cargo transactions. The following tabulated details would make the issue crystal clear:

Cargo Respondent Round-I Round-II Terminals at Category (July-Dec'16) (Jan-Jun'17) CSI Overall CSI CSI Overall CSI Chennai Exporters 4.33 4.33 4.36 4.34 Importers 4.34 4.32 Kolkata Exporters 4.35 4.28 4.20 4.11 Importers 4.21 4.02 Overall CSI of both the Air Cargo Terminals 4.30 4.23 It is observed that CSI for both the Cargo Terminals have increased considerably as compared to the previous Customer Satisfaction Survey which is well appreciated by AAI Management.

IV. Policy Matters under consideration: India Aviation Academy, Vasant Kunj MoCA vide UO Note No.ED (Cargo)/1353(1)/2017/545 Setting up of world class Smart Class rooms & Auditorium dated 01.05.2017 has been requested to take up the issue equipped with latest audio Visual system at New building with Ministry of Finance regarding the review of the norms for Indian Aviation Academy. for waiver of cost recovery charges, issued by CBEC vide Passenger Feedback System Circular 16/2013-Customs dated 10.04.2013. Feedback devices (Happy or Not) installed at 10 Airports Information Technology for passenger feedback. Further, work awarded to BSNL Strengthening and Augmentation of Information & for providing feedback devices at 32 airports. perimeter Security Based on the report received on Audit Adoption of NIC CPPP for e-tendering of IT Infrastructure carried out by high level committee E-tendering application in AAI was switched-over from E- comprising of Cert-In, NCIIPC, STQC &DieTY, TAPS to NIC Central Public Procurement Portal for E- improvement in Information Security has been achieved Tendering portal at etenders.gov.in. by deploying SIEM, VAPT, Email & web gateway, Procurement through GeM Publication of AAI ISMS Policies and imparting training on Successfully adopted GeM for faster procurement Information Security. Performance audit for ISO process. AAI IT received award from GeM in Nov. 2017 for 27001:2013 Certification was carried out in March 2018 highest procurement. and accordingly AAI has been recommended for issue of registration certificate to ISO 27001:2013. ERP enhancements New AAI web portal GST implementation, Online PMS, Income Tax Depreciation, Billing interface, Biller Direct & Host to Host New AAI web portal launched. It is a unified portal for integration, Access of ESS portal through Internet. Corporate, Airports & Employee information integrated with Aeronautical Information Management System.

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AOCC Implementation enhancing effectiveness of training programs. AOCC established at Lucknow and Goa Airports. Now 12 As on 31st March 2018, 391 officers (316 through Airports are managed through centralized AODB. customized programs, 75 through open nominations) Simulator for Incident Command Management System have been trained under this MoU target. In addition to (ICMS) for Fire MoU target, 54 participants have also been trained for at Work awarded for setting up of Simulator for Incident least 1 week under programs conducted by other reputed Command management System for Fire at FTC Delhi. This institutes like SCOPE, CBI Academy, ASCI, MDI etc. shall be first of its kind in India. 2. Co-ordinating short-duration training programs Upgradation of AIMS through external agencies Complete revamp of the AIMS application by provision of Besides long-duration training programs, AAI officials new hardware, refreshing of middleware software and were also sent for short-duration training programs, upgradation of application has been done for handling symposiums, seminars, workshops, conferences etc. growth in aviation sector. conducted by reputed institutes. A total of 476 executives Biometric Access Control System attended such programs, covering 777 man-days. Work is in progress for SITC of biometric access control 3. Conducting Training Programs at CHQ Training Centre systems integrated with centralized BCAS systems at 43 CHQ Training Center is fast developing into an internal Airports. 80 % of work has been completed. PDC - Sep center of excellence for programs targeting Non- 2018. Executives and lower management level. At CHQ training Implementation of VC centre, 537 employees were trained during the year 2017, The VC (Video Conferencing) facility has been extended to covering 1751 man-days through 22 programs on various 12 more Airports. topics. Emphasis was given to training programs for Non- Training Cell Executives. The non-executives belonging to HR The Training Cell was established at CHQ in March 2016 discipline were specifically trained for a week in specially with the aim to augment and streamline Training and designed programs covering various HR policies and Development activities of AAI officials. Subsequently, regulations. In other areas, Executives up to the level of E-3 Foreign Visit Cell was also merged with Training Cell in were also included for some programs to enhance training 2016. CHQ Training Centre was established in August, opportunities at lower management level. Programs on 2016 under administrative control of Training Cell for 'Stress Management' were also conducted for improving imparting training to Delhi-based AAI employees, mainly quality of life of employees and were appreciated by the Non-Executives. Since then, Training Cell has been participants working hand-in-hand with other Training 4. Induction-level Orientation Program for new recruits establishments of AAI and catering to Managerial and To facilitate smooth transition of new joinees at Executive function-specific (in some cases) trainings of AAI level (E1, E3 and E6), Induction-level orientation employees across locations. programme of 4-week duration has been introduced for After establishment of the Training Cell, the training and the first time in March 2017 in line with AAI's Training development activities of AAI Executives / Non- Policy. 246 new recruits have undergone Induction-level Executives have grown at a rapid pace, which is Orientation program during the year 2017 under 8 commendable. batches. Further, 41 Junior Executives of Operations In the year 2017-18, Training Cell provided firm support to discipline have undergone 8-weeks discipline-specific various disciplines of AAI in their training activities and training who were then sent for On-the-Job training at accomplished the following: various airports. 1. Conducting training programs as per MoU with MoCA 5. Participation in Overseas training and development As per the MoU signed with Ministry of Civil Aviation, AAI programs was given a target to train 3% (243) Executives (E1-E9) for To facilitate learning on a global platform, 423 executives at least 1 week through training programs at premier have been deputed for various training programs, institutes/Centers of Excellence. workshops, symposiums and meetings held abroad. This During April - December 2017, a total of 275 Executives helped them acquire requisite Knowledge, Skill and were trained through open nominations / customized Attitude (KSAs) for Operation & Maintenance of state-of- programs for AAI. The MoU target was achieved on 15th the-art technology and keep the workforce abreast with the latest development in the aviation industry. December 2017, well ahead of the target date of 31st March 2018. In case of customized programs, though the 6. Global ACI-ICAO Airport Management Professional MoU signing was done by IAA, Training Cell was Accreditation Program (AMPAP) instrumental in execution by getting approval of 24 Senior Executives have been trained under Global ACI- nominations and coordinating with nominated ICAO Airport Management Professional Accreditation employees to ensure their participation, thereby Programme (AMPAP) and have been designated as

48 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

International Airport Professional (IAP) during the year Bhubaneswar Airport during 5th-6th October 2016-2017. 24 more senior executives have been 2017. Training Cell provided actives support in nominated to undergo this program in 2017-18. organizing both the Airport Labs. Participation in this program has catapulted India and AAI 10. Development of STPs on a global aviation platform and has increased the Standardized Training Package (STP) on "Airfield number of qualified professionals in the country. Pavement Marking" has been validated and approved in 7. Apprenticeship Training June 2017. Further, development of STP on "Passenger In line with Skill India Mission, 682 new Apprenticeship Way Finding Signage" is in progress and is expected to opportunities in 10 disciplines across 104 locations were be approved soon. provided to enhance the employability of the youth. Recruitment Cell 8. Collaboration with IATA to design customized e- YEARWISE NUMBER OF VACANCIES FILLED THROUGH learning program DIRECT RECRUITMENT More than 300 employees were enrolled / trained through e-learning program on 'Introduction to Airport Cadre 2017 2018 Grand Total Operations', in association with IATA. As on 31st July, Group A 83 20 103 2018, more than 500 AAI officials have successfully completed the online program. Group B 687 49 736 9. Other achievements Total Group A+B 770 69 839 a. Two programs on Financial Literacy were Total 839 (GEN- 420, OBC- 232, SC-128, ST- 52 & PWD-7) conducted through Financial Literacy Advisory vacancies were filled during the year 2017 and upto March Board (FLAB), covering 94 Delhi-based participants. The programs focused on creating 2018 through Direct Recruitment. basic awareness about financial planning tools to Online Examination were conducted on 25th & 26th help participant's plan pre and post-retirement March 2018 for 10 disciplines for filling up 536 vacancies investments. through 25% Departmental Examination Quota. b. A unique program on 'Health and Stress Miscellaneous Management through Clapping' was organized at AAIOI through Aayushmaan Trust, Ujjain, 1. Stamping of hand-baggage tags has been dispensed covering 175 employees. with at 37 Airports, out of which 31 Airports are c. To enhance the spirit of camaraderie and team owned by AAI. work, 2 Outbound Training programs 2. AAI Imparted Surveillance / ADS-B training to Sri 'Synergize' have been organized for Delhi-based Lankan ATCOs and Afghan ATCOs. It has further employees of HR discipline, covering 44 enhanced the positioning of India as a competent participants. leader in ATM training in SE Asia. d. National Entrepreneurship Day was celebrated 3. Two-Stream Rating process for the air traffic on 9th November 2017 to create awareness on the theme 'Catalyzing a cultural shift in youth controllers, a significant departure from the earlier entrepreneurship'. As part of the celebrations, an Single Stream - Multiple Rating system. Essay-writing competition was also organized. MATERIAL DEVELOPMENTS IN HUMAN RESOURCES, e. Training Cell provided active support for SCOPE- INDUSTRIAL RELATIONS FRONT, INCLUDING NUMBER ILO study on 'Role of Women in Leadership & OF PEOPLE EMPLOYED Management in Public Sector'. Apart from Human capital has continued to be the key engine for our online survey of female Executives of E4-E9 level, growth and aspirations. AAI has been constantly AAI was identified among 15 PSUs where Key Informant Interviews (KII) and Focused Group reviewing its HR policies and practices to keep abreast Discussion (FGD) were conducted for mid-senior with the market changes and has embarked upon several management. initiatives to focus on creating a positive work f. Hosting of Airport Labs: International Airport environment that provides employees with ample growth Lab on "Emergency Table top exercise-best and development opportunities as well as ensuring high practices" was held at NSCBI Airport on 29th - 30th levels of motivation and engagement. Measures for safety November, 2017. Also, Domestic Airport Lab on of employee, scientific training, welfare, performance "Simulating Table Top exercise for a review of based appraisal system, compensation, career growth Airport Emergency plan" was organized at and social security schemes continued to remain key priority of the AAI.

23rd Annual Report 2017-18 49 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

The following are the achievements / major events during FY 2017-18 of HR Directorate (Policy Cell): Details of Achievements / Major events 1 The Performance Related Pay to Executives and Performance Linked Payment to Non-Executives for the year 2010-11 to 2014-15 has been distributed which was pending for the last 06 years. 2 Superannuation Benefit Scheme for the employees of AAI was pending since 2007, the approval of which got from MoCA with constant persuasion which is being implemented in AAI. 3 Implementation of Pay Revision of Board Level and below Board Level Executives w.e.f. 01.01.2017 in a time bound manner. 4 In line with DPE guidelines and Department of Pension & Pensioners' Welfare, the management of AAI has raised the ceiling of Gratuity from ` 10 Lakh to ` 20 Lakh for its employees' w.e.f. 01.01.2017. 5 Digitization of PMS data has been done for effective administration of PRP Scheme. 6 In order to ensure better management of its airports by having in place more competitive managers, AAI has reviewed the selection process for empanelment of Regional Executive Director (RED)/ Airport Director (APD) by creating a pool of pre- qualified and pre-selected REDs and APDs which would in turn simplify and fasten the process of selection. 7 Discontinuation of interview for the induction of at the level of Junior Executive (E-I) 8 With a view to provide equal opportunity to both men and women, the management of AAI approved recruitment of women candidates to the post of Junior Assistant (Fire Services) for the first time. 9 In a continuous effort to provide more supportive environment to women employees, AAI's management took a decision to extend the benefits of maternity leave to its women employees in case of surrogacy with IVF. 10 Biometric Attendance System (BAS) was put in place in AAI so as to ensure the discipline/ punctuality of AAI employees. 11 A comprehensive AAI Residential Accommodation Allotment Rules has been modified for the employees. 12 Revision of Leased Accommodation Policy was implemented in order to mitigate the hardship faced by the employees, especially in the two Metro Cities (Delhi and Mumbai). 13 To mitigate the difficulties faced by the employees of all categories with defined disability (Blindness, Low Vision, hearing impairment, Locomotor disability, Cerebral Palsy, Orthopedically handicapped), decided to transfer near their native place. 14 In order to ensure smooth transfers, the TA/DA Rules have been relaxed and Daily Allowance for the first 30 days at the new station in order to enable him to make tie-up arrangements irrespective of the number of days of continuous stay at the station. 15 As a welfare measure, it has been decided to provide entitlement of journey by Air to regular Assistant Managers and above while on tour/transfer/training. The above benefit is also extended to Junior Executives (E-1) subject to the condition that Air Fare should be restricted to a maximum of double the train fare of 2nd AC. 16 As a step further towards ensuring social security to its employees, the management of AAI has enhanced the monthly entitlement benefit under Employees Benevolent Scheme, Coverage under Group Insurance Scheme and Group Personal Accidental Insurance Scheme on death for all employees by approximately 5-7 times from the current amount. 17 In line with DPE's initiative on Social Safety, AAI introduced Counselling, Retraining and Redeployment (CRR) Scheme to provide opportunities of self/wage employment to its employees separated under Voluntary Retirement Scheme (VRS)/ Voluntary Separation Scheme (VSS). 18 In an effort to maintain its culture of hearty welcome and warm exit, AAI enhanced the gift amount for superannuating employees to ` 6,000/- and the same has also been extended to employees who take voluntary retirement on attaining the age of 50 years. 19 As a welfare measure for its ATCOs, the management of AAI revised the Rating Allowance for ATCOs posted at four Metros viz; Chennai, Delhi, Kolkata and Mumbai with an objective of providing equal weightage to both the Streams i.e. Terminal and Enroute. 20 With an objective to increase employee morale & motivation and to create a healthy competition, AAI launched one of the most important and successful employee recognition programs i.e. 'Employee of the Month' Award to be implemented at top 25 airports managed by AAI.

50 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

REPRESENTATION OF SC/ST/OBC & PERSONS WITH DISABILIES AS ON 31.03.2018 The manpower strength of Airports Authority of India is as under:

Total No. Total No. % of SC Total No. % of ST Total No. of % of OBC of Emp. of SC Emp. Emp. of ST Emp. Emp. OBC Emp. Emp. 17535 3828 21.83 1301 7.42 3721 21.22

Total number of employees and the number of persons with disabilities in AAI as on 31.03.2018

Total No. of Visually Hearing Orthopedically Total No. % of Employees Handicapped Handicapped Handicapped of PWDs PWDs 17535 24 17 160 201 1.15

FACILIES AVAILABLE FOR PERSONS WITH (g) Drinking water: 750 mm high and 300 mm deep DISABILITIES AT VARIOUS AAI AIRPORTS: drinking water facility is provided for easy (a) Smooth ramps with anti-skid flooring of the accessibility of passengers on wheel chair at busy comfortable gradient are provided at the terminal airports. building entry points and kerb area. (h) Facilitation Counter: 850mm high and 250mm deep (b) Door: Sensor fitted doors / manned doors at entrance facilitation counters provided for easy accessibility of are provided for easy accessibility. Door opening are passengers on wheel chair at busy airports. wide enough for easy access for wheel chair (i) Car Park: Reserved parking spaces with signages have passengers. been provided on city side of Departure and Arrival (c) Toilet: Specially designed separate handicapped Terminals at various Airports. Slots of 3.6 m x 5.0 m car toilets are provided with appropriate signages. park space are specially designated in the car parking area for physically challenged persons. (d) Elevators: 16 Passengers' elevators provided to access all levels of terminal building taking care of the (j) Accessible Route: 5m-10m wide kerb is provided in door opening to allow biggest size of wheel chair. At front of terminal building, which is directly connected some of the airports, one of the two elevators is deep. to road with smooth ramp. From kerb side passenger can board the Taxi/Car. For the easy access of wheel (e) Aerobridges: To facilitate smooth emplaning and chair special cuts and slops are provided in the deplaning of physically challenged passengers with pavement. At some of the airports, engraving on wheel chairs, the aerobridges wherever provided surface of Zebra crossing is provided for blind have smooth gradient slope and anti-skid flooring. persons. (f) Wheelchairs: Wheelchairs are available with Airport (k) Tech Tiles: Tech tiles are provided at Metro airports for Manager and Airlines on demand. visually impaired passengers from alighting points to entry vestibule at metro airports.

23rd Annual Report 2017-18 51 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Annexure -3

CAPITAL SCHEMES COMPLETED (F.Y. 2017-18) Northern Region (Amount in ` Crore) Project-site Particulars Completion Date Completed Cost Jammu Expansion and modification of Terminal Building i/c all packages 30.09.2017 75.75 i/c Provision of tensile fabric canopy and associated work at CA Jammu .

Expansion and Modification of Terminal Building at CA Jammu. 20.07.2017 5.29 SH: SITC of substation equipment, DG Sets & Other Electrical Works. Amritsar Extension / Strengthening including CAT-II to CAT-III. 06.09.2017 73.44 Lucknow Construction of ASR/MSSR Building. 07.04.2017 3.52 Jaipur Leveling & re-carpeting of disused R/W from Tango Taxi track to 30.12.2017 3.33 Airport runway 33. SITC of Grid mounted design based solar plant under CAPEX model 15.03.2018 9.74 at Jaipur Airport. Kishangarh Construction of Boundary wall i/c perimeter lighting. 30.05.2017 9.67 Airport Construction of Fire Station cum Control Tower 11.06.2017 12.38 Balance work of blast pad, RESA, Basic strip of runwy and perimeter 15.12.2017 6.48 road at Kishangarh Airport. Provision of Airfiled lighting facilities 02.11.2017 3.39

Southern Region (Amount in ` Crore) Project-site Particulars Completion Date Completed Cost Trivandrum Airport Resurfacing and strengthening of runway and taxiways 06.10.2017 50.84 Construction of New Terminal Building, ATC Tower cum 28.11.2017 42.65 Technical Block cum Fire Station, Sub Station and other Ancillary Buildings and Services Construction of NTB.ATC tower cum tech block cum fire 30.10.2017 42.23 station, Substation & other ancillary buildings and services Construction of covered RCC Drain Parallel to RWY 29.12.2017 9.34 Construction of Isolation bay, apron bays with taxiway 30.03.2018 26.55 and associated works Rajahmundry Extension of Apron in front of New Terminal Building 15.04.2017 18.54 Airport including Electrical Works Tirupati Airport Construction of Boundary Wall for the newly acquired land 19.06.2017 13.33 Resurfacing of existing runway, taxiway and 12.05.2017 5.93 strengthening of apron Re-carpeting of runway 04-22 19.06.2017 5.78 Coimbatore Expansion of Apron for Two Nos of Additional parking Bays 30.03.2018 5.45 Airport

52 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

CAPITAL SCHEMES UNDER PROGRESS (F.Y. 2017-18) Northern Region (Amount in ` Crore) Project-site Particulars Physical PDC Approved progress Cost Amritsar Provision of 07 Nos. Apron Drive Passengers Boarding Bridges (PBBs) 95% Apr'18 21.00 (i/c Lucknow and Advanced visual docking Guidance system (AVDGs) at various & Jammu) Airports in India. Interior works on Ist floor of TB. 28% Jan'19 10.98 Allahabad Development of New Civil Enclave (Design & Build). 20% Nov'18 137.53 Construction of National Aviation University 87% Apr'18 85.56 SH: Construction of Academic Block, Hostel, Substation Building & IGRUA other allied works. (Fursatganj) Construction of Sr. Faculty, Jr. Faculty and Sr. Executive Housing & 55% May'18 23.54 other allied works. Delhi Construction of Indian aviation academy and Hostel Block 97% May'18 93.65 Construction of central air traffic flow management 80% Oct'18 37.38 C/o combined operational complex of DGCA, BCAS, AAIB, AERA & 9% Apr'20 233.65 AAI (Deposit work). Varanasi Re-carpeting of runway, widening of turning pad 27 and widening of 80% Sep'18 21.76 fillet / shoulder of taxi A,B & D of LSBI Airport. Construction of control tower cum technical block 5% Feb'19 17.16 Lucknow Recarpeting of Runway at CCSI Airport. 20% Aug'18 43.62 Construction of fire station category IX, Emergency medical centre & 0.50% Jul'19 30.88 associated work at CCSI Airport Lucknow. C/o of Apron for 08 Nos. Code 4C type of aircraft alongwith Two link 1.00% Mar'19 70.44 Tways at CCSI Airport. (i.e Additional Parking Bays). Gorakhpur Construction of New Passenger Terminal Building. 68% Apr'18 9.66 Jodhpur Construction of New Apron and link Taxi 28% Jun'18 12.97 Udaipur Construction of drain & grading of basic strip 80% Apr'18 8.90 Construction of apron, link taxi & expansion of isolation bay 10% Mar'19 22.91 Jaipur Providing cover over Nallah. 80% Aug'18 9.23 Construction of parallel taxi track from Tango taxi to Nallah. (Phase - I) 16% May'18 28.11 Expansion / Modification of existing terminal building at Jaipur Intl. 5% Nov'18 15.62 Airport, Jaipur Dehradun Construction of Additional Parking Bay. 5% Feb'19 17.69

23rd Annual Report 2017-18 53 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

CAPITAL SCHEMES UNDER PROGRESS (F.Y. 2017-18) Southern Region (Amount in ` Crore) Project-site Particulars Physical PDC Approved progress Cost Vijayawada Extension and Strengthening of Existing Runway 08-26 and associated 85% Dec'18 145 Airport works Mangalore Construction of Link Parallel Taxi Track (Phase-II) and Grading of Basic 30% Aug'19 120.71 International Strip at South Side Airport Calicut Construction of new International arrival block, Internal Modification of 99% Nov'18 120.19 Airport existing International Passengers Terminal Building and associated works Kadapa Extension & Stengthening of Existing Runway, Taxiway and Apron along 30% Mar'19 94.44 Airport with construction of Isolation Bay, Pavement against Blast Erosion, RESA and Perimeter Road Grading of Strips etc. at for the Operation of Code-C Type of Aircraft including electrical works Bangalore Construction of AAI Residential Colony at Devenhalli, near Kempegowda 10% Mar'20 90.44 International Airport, Bengaluru - Design & Build Chennai Modernisation of Chennai Airport Phase-II, Chennai. (Cost: `85.87 Crore) 100% May '18 14.94 Airport SH-I: Connectivity to Metro Rail city side and Provision for Walkalators at Chennai Airport, Chennai. SH-II: Connectivity to Metro Rail city side and Provision for Travellators 100% Apr'18 15.40 and Escalators at Chennai Airport, Chennai. Project Management Consultancy for Modernization work (Phase-II ) 50% Sep'22 45.00 Augmentation of power supply of existing Terminal Bldg. 60% Dec'18 10.78 Augmentation of air-conditioning of existing Terminal Bldg. 100% Jun'18 13.16 Augmentation of Baggage Handling System 100% May'18 17.41 Construction of 2 nos. Rapid Exit Taxiways (RET) for the main runway 41% Oct'19 97.60 07/25 and straightening of B-Taxiway as Parallel taxi track suitable for code-E Aircraft at Chennai International Airport, Chennai. Visakhapat- Extension of Apron for additional 06 nos. Parking bays 100% Aug'18 59.83 nam Airport Goa, Calicut, Providing Apron Drive Glass Walled Passenger Boarding Bridges and 90% Feb'19 56.34 Coimbatore, Advanced Visual Docking Guidance System (AVDGS) Mangalore, Trichy, Vadodara, Amritsar, Ahmedabad & Trivandrum Airports Tiruchirappalli Project Management Consultancy for Construction of new integrated 50% Dec'21 32.28 International Passenger Terminal Building i/c elevated roads and other associated Airport works Trivandrum Extension of air side arrival corridor with rotunda at NITB (C& E) 100% Sep'18 20.98 Airport Tirupati Construction of Perimeter Road 100% Jun'18 14.60 Airport Puducherry Construction of New ATC Tower Cum Technical Block Cum Fire Station 30% Sep'19 12.54 Airport Coimbatore Facelift works of Terminal building 100% Jul'18 5.03 Airport SH: Providing Tensile Fabric Canopy & Balance works Rajahmundry Extension of Runway and Strengthening/Resurfacing of existing runway 90% Dec'18 132.14 Airport along with construction of isolation Bay, pavement against blast erosion and RESA & other allied works at Construction of Operational Wall & property boundary wall 100% Oct'18 23.81

54 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

DEVELOPMENT OF AIRPORTS IN THE NORTH EAST REGION (F.Y. 2017-18) AAI is continuously putting efforts to enhance the airport infrastructure in remote areas to improve the air connectivity.

The works undertaken and that are planned to be taken are given below :

Capital Schemes Completed (Amount in ` Crore) Project-site Particulars Completion Date Completed Cost Pakyong Airport Construction of Terminal Building, Control Tower cum Feb'18 43.44 Fire Station and other Misc. work.

Capital Schemes under progress (Amount in ` Crore) Project-site Particulars Physical PDC Approved progress Cost Agartala Upgradation of safety Infrastructure i/c basic strip. 38% 30.06.2018 25.10 SH: Construction of Operational Boundary Wall, Property Wall, Watch Towers, Perimeter Road and Storm Water Drain. Construction of new domestic Terminal Building Apron, Taxi track and 62% 08.01.2020 14.85 allied works. (a) SH: Appointment of project management consultant for construction of New Integrated Terminal Building and associated works. Construction of CISF barrack, quarters guard etc. 27% 30.09.2018 13.07 Construction of new domestic Terminal Building Apron, Taxi track and 55% 31.05.2018 49.14 allied works. (b) SH: Construction of Apron, Taxi track. (c) Construction of New Integrated Terminal Building and associated work. 36% 16.06.2019 338.93 Construction of New Isolation Bay and Associated link Taxi Track. 45% 09.06.2018 15.57 Barapani Construction of Technical Block (supported) renamed, 18% 30.06.2018 6.74 Construction of New ATC tower cum fire station. Construction of balance portion of boundary wall of newly acquired land. 90% 30.06.2018 5.63 Extension of Runway from 6000 feet to 7500 feet and allied works at Mobilization 30.11.2018 122.95 , Barapani, Meghalaya. work in progress Construction of Perimeter Road 15% 20.06.2018 9.67 Dibrugarh Extension of Runway, Isolation Bay, link taxi track and allied works. 41% 13.12.2018 52.31 Construction of Hangar. 5% 20.02.2019 18.32 Dimapur Strengthening of Runway, Taxiway & Apron including Construction of 5% 28.03.2019 41.28 Isolation Bay with Link Taxiway Guwahati Construcion of new domestic Terminal Building and allied works. 40% Feb'21 1100.00 SH: Appointment of project management consultant for Construction of New Integrated Terminal Building and associated works. Construction of compound wall surrounding acquired land. 57% 25.06.2018 5.67 Strengthening of existing runway 02/20 5% 28.02.2019 44.78 Construction of New Integrated Terminal Building Mobiliza- 20.03.2021 859.86 tion work in progress

23rd Annual Report 2017-18 55 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

(Amount in ` Crore) Project-site Particulars Physical PDC Approved progress Cost Imphal Expansion of apron by 175x130m along with link taxiway to 99% Sep'18 13.28 accommodate 3nos AB-321,1 no AB-320 & 3nos ATR-72 class aircrafts. (Total 7 parking stand). Raising height of newly constructed Perimeter wall by MPHC at newly 75% Aug'18 6.93 acquired land. Provision of Canopy in front of terminal building and associated works. 60% Sep'18 8.31 Construction of Hangar, Associated apron & link taxiway 10% Jun'19 30.33 Recarpeting of runway & major repairs to taxiway. 10% Aug'18 43.24 Shifting & Construction of Perimeter wall along NH 150. 73% Jul'18 7.02 Silchar Re-carpeting of Existing Runway i/c shoulders. 95% Apr'18 11.10 Tezu Development & Operationalization of in LohitDistt. of 8% Apr'18 38.41 Arunachal Pradesh. SH: Main Terminal Building, Ancillary Structures like ATC Cum Technical Block, Fire Station, CCR Hall, RCC Underground Water Tank, Pump House etc.( Balance Work). Pakyong Construction of New Greenfield Airport, East . SH: Earth work in 99.85% May'18 264.29 cutting & filling geo-gridfeinforced retaining wall, Drainage System i/c Box Culvert, Aerodrome pavements etc.

56 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

CORPORATE SOCIAL RESPONSIBILITY Annexure - 4

The Annual Report on Corporate Social Responsibility (CSR) Activities

1. A Brief outline of the AAI's CSR Policy, including Annexure. Further, a separate section on the overview of projects or programs proposed to be Corporate Social Responsibility & Sustainability forms undertaken and a reference to the web-link to the part of the Annual Report. CSR policy and project or programs. AAI's CSR and welfare activities during FY 2018-19 AAI believes in giving back to society and maximizing would be around promoting education with special positive impact for all its stakeholders. At AAI, being a emphasis on girl child, eradicating hunger, catalyst for change at the grassroots is as important as promoting preventive healthcare and sanitation. a healthy bottom line and robust business growth. Further, Hon'ble Prime Minister of India in the CPSE AAI's approach towards CSR and Sustainability is to conclave held on 09.04.2018 suggested that the CSR empower under-privileged communities near its spend of CPSEs should be focused largely on one airports so as to promote an environment of inclusive specific theme each year. Accordingly, AAI's Board growth. Its CSR and welfare activities are committed approved the following Annual CSR theme of AAI for to create and support programmes that bring about FY 2018-19:- sustainable changes in society including through "Providing support to health sector in improving education. basic health care facilities and mitigating life During the financial year 2017-18, AAI has undertaken threatening diseases like cancer." a range of CSR Activities this year with special AAI's CSR Policy is available and can be viewed on emphasis on Sanitation, Health, Skill Development, AAI's website at https://www.aai.aero/sites/ Environment and sustainability. The overview of default/files/csr_policy/Corporate%20Social%20Re various CSR projects and programmes undertaken by sponsibility%20%26%20Sustainability%20Policy%2 AAI has been provided in detail at Point 5 of this 02017-2209.pdf

2. Composition of CSR Committee as on March 31, 2018 Name Designation Dr. (Mrs.) Tuktuk Ghosh Kumar, Chairperson Non-official Member (Independent) Dr. Guruprasad Mohapatra Chairman, AAI Sh. Sudhir Raheja* Member (Planning) Sh. Anuj Aggarwal Member (HR) * Consequent upon resignation of Shri Sudhir Raheja, Member (Planning) on 30th June 2018, he ceased to be a member of the CSR Committee. 3. Average net profit of AAI for last three financial years - ` 3680.46 crore 4. Prescribed CSR Expenditure (two percent of the amount as in item 3 above) - ` 73.61 crore 5. Details of CSR spent during the financial year: a) Total amount to be spent for the year financial year - ` 71.91 crore b) Amount unspent, if any; - ` 1.70 crore

23rd Annual Report 2017-18 57 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

c) Manner in which the amount spent during the financial year is detailed below (Amount in ` Crore)

S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 1 Open Defecation Sanitation Pan India 7.00 0.75 0.75 Direct Free (ODF) in (i) Villages (PAN INDIA) 2 Swachh Vidyalaya Sanitation Pan India 18.00 2.82 2.82 State Govt / initiative (for (i) Direct additional toilets) 2015-16 3 Development of Sanitation Sulaiman Street area, 0.54 0.55 0.55 State Govt Open areas (i) Thiruvananthapuram, adjacent to Kerala Airport into waste free area. 4 Construction of Sanitation Allahabad, UP 0.30 0.07 0.34 Direct Community Bio (i) Toilet Complex at Phoolpur, Allahabad 5 Establishment of Sanitation Chennai, TN 0.56 0.05 0.05 State Govt Solid Waste (i) Treatment Plant near Chennai Airport 6 Contribution to Sanitation New Delhi 15.00 15.00 15.00 Min. of Swachh Kosh for (i) Finance Swachh Bharat Initiative 7 Setting-up of Eradicating Guntur (Manglagiri), 15 4.60 4.60 State Govt Central Kitchen at Hunger (i) Andhra Pradesh Guntur, Andhra Pradesh Akshay Patra Foundation 8 Setting-up of Eradicating Hazaribagh, 20 6.00 6.00 State Govt Central Kitchen Hunger (i) Jharkhand at Hazaribagh, Jharkhand through Akshay Patra Foundation 9 Construction preventa- Lilabari 0.26 0.35 0.35 State Govt and upgradation tive of Casualty Ward health in North Lakhim care (i) pur District Civil Hospital, Lilabari, Assam

58 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 10 Providing Funds preventa- Pan India 1.00 0.50 0.75 M/s. ALIMCO, for Cochlear tive health Govt PSU Implant Surgery care (i) to ALIMCO (Govt PSU) for 15 under -privileged children. 2015-16 11 Providing Funds preventa- Pan India 6.69 5.02 5.02 M/s. ALIMCO, for Cochlear tive health Govt PSU Implant Surgery care (i) to ALIMCO (Govt PSU) for 100 under-privileged children. 2017-18 12 Providing Radio preventa- Chennai, TN 18.50 1.85 1.85 State Govt therapy Equip- tive health ment (Linear care (i) Accelerator and Brachytherapy) in Govt Hospital, Chennai 13 Funding for Treat preventa- Mumbai 1.31 1.31 1.31 Tata ment of Paediatric tive health Memorial Patients suffering care (i) Hospital, from Cancer Mumbai Disease belonging to BPL at Tata Memorial Hospital, Mumbai 14 Provisioning of preventa- Longding Distt, 0.22 0.11 0.22 District Collector Ambulance to tive health Arunachal pradesh - Longding Distt, Primary Health care (i) Arunachal Centre in Pradesh in Longding Distt, coordination Arunachal Pradesh with State Govt. 15 Provision of preventa- Lucknow, UP 0.20 0.14 0.14 Direct ambulance for tive health medical service care (i) for Dr. Sukuntala Misra National Rehabilitation University, 16 Construction of preventa- Gorakhpur, UP 4.70 1.69 1.91 Direct shelter / provision tive health of facilities/ care (i) infrastructure at BRD Hospital

17 Cancer detection preventive Kondoty, Calicut 0.65 0.58 0.58 State Govt cum community health mental health care (i) clinic

23rd Annual Report 2017-18 59 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 18 Upgrading preventive Silchar 0.76 0.76 0.76 State Govt services of health Pathology, care (i) Deptt of Cachar Cancer Hospital & Research Centre, Silchar 19 Provision of preventive Sikkim 0.07 0.06 0.06 Direct ambulance for health PHC, Sikkim care (i) 20 Cervical Screening preventive Pan India 1.38 0.34 0.34 Kalyanmayee- Camps by health AAIWWA Kalyanmayee - AAI care (i) Women Welfare Association in the slum areas of the 12 identified airport cities in India 21 Development of Rural Guwahati & Jharkhand 10.00 1.37 1.37 State Govt model villages in Develop the state of Assam ment and Jharkhand Project (x) in association with State Govt. and UNDP 22 Funding for Education Dehradun 0.24 0.24 0.24 State Govt purchase of table, (ii) Rudraprayag, chair, etc., for Uttrakhand Centre of Excellence in Education at Rudraprayag, Uttrakhand 23 Renovation of Education Hariharpur, Azamgarh 0.51 0.50 0.50 State Govt Primary School (ii) UP & Teachers skill Development 24 Construction of Education Kolkata 5.98 1.72 4.32 Direct School near Dum (ii) Dum Airport 25 Construction of Education Ajmer, Rajasthan 0.49 0.32 0.50 Direct Boundry wall, (ii) rain water harvesting, playground and providing sports equipments, furniture, jhulas etc in Govt. Sr. Sec. School, Village Silora, Ajmer

60 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 26 Provision of Education Ajmer, Rajasthan 0.35 0.37 0.37 Direct drinking water (ii) supply and water purifier, provision of roof top solar panel and provision of toilets in 20 Govt schools 27 Construction of Education Patna, Bihar 0.20 0.12 0.12 AAI class room & (ii) toilets, path at Govt Blind school, Kadam Kaun, Patna 28 National Aviation Employment Chandigarh 5.25 1.25 1.25 NSDC & Skill development enhancing NSDF centre and Skilling vocation youth in skills (ii) association with NSDC 29 Setting up of a Employment Vizianagaram, 0.26 0.13 0.13 State Govt Skill Development enhancing Andhra Pradesh Centre vocation skills (ii) 30 AAI Skill Develop Employment Pan India 7.89 4.21 8.15 M/s.CIDC, a ment Programme enhancing Society set-up in partnership vocation by Planning with Construction skills (ii) Commission Industrial Develop ment Corpn (CIDC) - Training and Placement to 2000 unemployed youth /SC /ST/OBC/ Women & EWS Society 2015-16 31 AAI Skill Develop Employment Pan India 10.59 2.69 2.69 M/s.CIDC, a ment Programme enhancing Society set-up in partnership vocation by Planning with Construction skills (ii) Commission Industrial Develop ment Corpn (CIDC) - Training and Placement to 2000 unemployed youth/SC /ST/ OBC/ Women & EWS Society 2018-19 32 Development of Setting up Raipur 2.00 0.77 2.01 Direct home for senior Old Age citizens at Manna Home (iii) Camp near SVI Airport, Raipur 33 Provision of LED Environ- Machhlishahar, UP 0.30 0.23 0.23 Direct solar street light mental sustaina- bility (iv)

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S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 34 To operate & environ- Rangpuri, New Delhi 1.50 0.36 1.49 Direct manage the paper mental recycling unit at sustaina- Rangpuri, bility (iv) NEW Delhi 35 LED solar street environ- Bhadoi, UP 0.30 0.31 0.31 Direct light in Distt. mental Bhadoi sustaina- bility (iv) 36 Contribution to environ- New Delhi 5.0 5.00 5.00 National Clean Ganga mental Mission for Kosh sustaina- Clean Ganga bility (iv) 37 Provisioning of environ- Ghazipur 0.2 0.34 0.34 Direct Solar Street Light mental sustaina- bility (iv) 38 Construction of Rural Pakyong, Sikkum 9.37 3.89 4.83 State Govt multipurpose Develop community hall, ment Pakyong, Sikkim. Project (x) 39 Construction of Rural Garal, Kamrup 2.35 0.71 0.71 State Govt Community Hall Develop Guwahati at Garal, Kamrup, ment Guwahati Project (x)

40 Integrated Sanitation Pan India 6.00 3.80 3.80 Direct Development of (i) Environ- villages for mental drinking water, sustaina- Sanitation, bility (iv) Connectivity, Rural Renewal energy Develop- etc. ment Project (x)

41 CSR Training Overhead Pan - India 2.61 0.05 1.67 Direct / IICA CSR Activities 42 Provisioning of Education Ajmer, Rajasthan 0.80 0.14 0.14 Direct class rooms and (ii) misc. works in 10 Govt. schools of Ajmer Distt., Kishangarh.

62 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. CSR Project Sector in Projects or Programs Amount Amount spent on Cumulative Amount No. or Activity which the (1) Local areas or other outlay the projects or expenditure spent: Identified Project is (2) Specify the State (budget) programs Sub- upto to the Direct or covered and District where project or Heads: (1) Direct reporting through projects or programs programs or expenditure period implementing was undertaken wise on projects or agency programs (2) Overheads 43 Provisioning of Sanitation Pratapgarh, UP 1.29 0.77 0.77 Direct India-marka (i) (300 nos) Handpump 44 Renovation of Education Dibrugarh, Assam 0.10 0.07 0.07 Direct Anganwadi (ii) School, Mohanbari, Assam TOTAL 185.72 71.91 84.41 6. Reason for not spending the prescribed 2% amount AAI, in the financial year 2017-18 had spent 1.95% of the profits (` 71.91 crore) on CSR activities out of the allocated limit of 2% of profits (` 73.61 crore). It could not spend the entire allocated budget& remained short of spending ` 1.70 crore, since most of the CSR programmes are long term projects and thus, amount is spend on progress basis.But AAI have the approved CSR programmes against the CSR Budget of 2017-18 and of the respective years and itis making all possible efforts to implement these programmes & ensuring 100% spend of the CSR budget for FY 2017-18 and of previous years too. AAI is persistently exploring new opportunities where it can serve the society & the nation and as a socially responsible enterprise, it is committed to play a larger role in India's sustainable development by embedding wider economic, social and ecological objectives. It is gradually increasing its CSR expenditure as can be seen from the table given below:-

CSR Expenditure 80 71.91 70 60.19 60

50

in Crore) 40 ` ( 29.73 30

20 14.6

10 0 2014-15 2015-16 2016-17 2017-18 Financial Year

7. Responsibility statement of the CSR Committee The Committee confirms that the implementation and monitoring of CSR Policy, is in compliance with CSR objectives and Policy of the AAI.

sd/- sd/- Dr. Guruprasad Mohapatra, IAS Dr. (Ms.) Tuktuk Ghosh Kumar, IAS (Retd.) (Chairman, AAI) Chairperson - CSR Committee

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AAI CSR-Giving back to the society

As a socially responsible enterprise, Airports Authority of • Maharaja District Hospital, Vizianagaram, Andhra India (AAI)is committed to serve the society and is making Pradesh efforts to enhance the quality of life of the people from the • Maharani Hospital (Gosha Hospital), Vizianagaram, under-privileged sections of the society, especially those Andhra Pradesh residing near its airports. The AAI is continuously Ambulance Services exploring the opportunities where it can serve the society and is gradually increasing its expenditure on Corporate AAI has provided assistance for emergency medical Social Responsibility and welfare activities. facilities to expectant women through "Maternity Van Programme", for ` 1.25 crore to District Hospitals in A brief on some of the CSR projects undertaken by AAI Indore. during FY 2017-18 is given below:- AAI has also provided an Ambulance Service with Up-gradation of Department of Pathology at Cachar Advanced Life Support Systems (ALS) for Longding Cancer Hospital and Research Centre, Silchar District of Arunachal Pradesh with an objective of AAI has allocated `76.05 Lakh for Up-gradation of strengthening the health services in the remote North- Department of Pathology at Cachar Cancer Hospital and East Region under Airports Authority of India's CSR Research Centre, Silchar under CSR. Cachar Cancer Initiatives. Hospital and Research Centre, Silchar has procured state Treatment of pediatrics patients at Tata Memorial of the art pathological & diagnostic equipment like Hospital Automatic Tissue Processor, Cryostat, Automatic Slide Pediatrics patients suffering from cancer disease who are Strainer, -86°C Deep Freezers, Anaesthesia work below the poverty line were given treatment at Tata station with ETCO2 5 Pera Monitor etc. The facilities Memorial Hospital, Mumbai with a cost of Rs. 1.31 crore till were inaugurated on 07th March 2018. Approximately 01 31.03.2018. Lakh people from the underprivileged section of the society are expected to benefit from such facility over a period of time. The Cachar Cancer Hospital and Research Centre (CCHRC), Silchar is an 83 bed comprehensive Cancer

Providing Funds for Cochlear Implant Surgery to ALIMCO for Under-Privileged Children AAI signed MoU with Arti?cial Limbs Manufacturing Corporation of India (ALIMCO) and sponsored 115 Centre with facilities for Cancer prevention, diagnosis, underprivileged children in the F.Y. 2017-18 for cochlear treatment, education and research. With an annual inflow of over 3000 new and 15000 follow-up patients the Hospitals serves the underserved population hailing from Barak Valley, DimaHasao district of Assam, the neighbouring North Eastern states like Tripura, Manipur, Meghalaya and Mizoram. A number of patients from Bangladesh also access treatment at the Hospital. Financial Support To Hospitals for Procuring Medical Equipments AAI has provided financial support for procurement of additional Medical equipments in the following hospitals: • Sri Venkateswara Institute Of Research and Rehabilitation for the Disabled (VIRRD), Dwaraka, Andhra Pradesh

64 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

implant surgeries which has been successfully completed. collection and transportation on pilot basis in 14 wards Furthermore, AAI has sponsored 200 underprivileged of Varanasi along the banks of Ganga. The AAI children in the current F.Y. 2018-19 for ` 13.41 crore for extended support towards this SWM project at which MoU has been signed on 31.07.2018 Varanasi to the tune of ` 5 crore. AAI signed with ILBS for Project Empathy on World • For solid waste treatment plant near Chennai Airport - Hepatitis Day ` 56 lakh. AAI has provided financial assistance to Project Empathy, • At Leh, AAI signed an MoA with Autonomous a four year project being implemented by ILBS, which is Hill Development Council (LAHDC) on 07.04.2018 for an amount of ` 6.26 crore. Hunar Se Rozgaar : Airport Authority of India contributing to Skill India Through country's first Aviation Multi Skill Development Centre (AMSDC) which was recently inaugurated on 27th February 2018 in Chandigarh, the AAI endeavors to uplift the under privileged youth, especially women by training them and skilling them to head start their careers in aviation. Total 2,400 youth in next three years will be imparted training at the Centre for 8 job roles viz. Airline Customer Service Executive, Airline Reservation Agent, Airline Security Executive, Airline flight load controller, Airline Cargo Assistant, Airline Ramp Executive, Airport X Ray Qualified Staff, Airport Facility Services. focused on empowering people against hepatitis. Initially, ` 5 crore has been provided and for next 4 years ` 5 crore This initiative, which aims to profoundly contribute per year will be provided. towards inculcating 'Hunar' in the young generation and getting them 'Rozgaar' for a 'Kaushal Bharat, Mazboot Constructions of Toilets in Government Schools Bharat', has been taken up in collaboration with National Since 2014-15, AAI, in co-ordination with the Ministry of Skill Development Corporation (NSDC) and Aerospace Human Resource Development (MHRD), under the and Aviation Sector Skill Council (AASSC). Bird Education 'SwachhVidyalaya' initiative, constructed more than 1500 Society for Travel & Tourism (BESTT), a renowned name for imparting aviation education in the country for over 20 years has been appointed as the knowledge partners to implement this project. The students will undergo an extensive training regime of 240 hours in over 45 days. The training is provided free of cost and has been sponsored by the AAI. The training curriculum has been designed by AASSC and the study material too is distributed free.Apart from this, an incentive of ` 2,900/- is also given to the students to encourage them to complete their training. On successful completion of the course, they are awarded NSDC certification and are offered placement opportunity with the airlines, ground handling service providers, travel toilets in approximately 800 government schools, thereby companies and other stakeholders. bene?tting more than 100,000 under-privileged students The AAI through this initiative is strongly committed studying there. Till March 31,2018, more than ` 29 crore towards contributing to the growth of civil aviation in the has been spent on the construction of toilets. Country and nation-building. Solid Waste Management Project at Varanasi, Chennai Skill Development Programme and LEH Following the success of Skill Development initiative in Details of financial assistance provided by AAI for Solid 2015-16, Airports Authority of India (AAI) and Waste Management (SWM):- Construction Industry Development Council (CIDC) • Mechanized and automated system for solid waste signed an MOU for "Financial Assistance for Employment

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Oriented Training and Skill Development Programme for force at any stage of construction on projects should be SC/ST/OBC/Women, Unemployed Youth & EWS of society trained, tested and certified. This translates to creating for 2000 persons under the CSR initiative through more job opportunities for the trained and certified Construction Industry Development Council (CIDC)" people. during 2016-18. Besides the curriculum, students are encouraged to take The program is aimed at providing job oriented skill part in extra-curricular activities to help them in development and training to the marginalized and personality development. On campus job meets or economically weaker sections of the society across India. rozgarmelas are arranged to encourage construction The training to the beneficiaries is organized in CIDC companies to engage with students for campus centers. placements. AAI has been able to leverage its CSR activities through Given the emphasis on skill development under the this imitative to create a bigger impact and help in National Skill Development Policy / 12th Five Year Plan / livelihood promotion for people from backward and high demand for skilled construction labour for nation remote areas as well as help the marginalized sections building and creation of a captive skilled workforce in the gain mainstreaming by way of imparting skills and nation, AAI realizes that it is imperative to raise capacities training leading to their future employment. of the industry and is committed to meet the future and AAI has also proactively included a Clause in their General current challenges of skilling India. The above initiative is a Conditions of Contract that states that 20% of the labor bold step in making mission skill India a resounding success.

66 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

SUSTAINABILITY REPORT

For sustainable development, AAI has taken following corporation of India (SECI) to set up the roof top Solar steps:- Power Plant at various airports. I. Solar power plants :- AAI has commissioned 30.145 MWp Solar Power Plant at 37 Airports/ Locations by which AAI is able to generate AAI is setting up the solar power plants for energy approx. 410 lakh units till April'2018. Total 7.52MWp generation at various airports in place of conventional capacity roof top & ground mounted Solar Plant source of fuel i.e. coal etc.,which is non-renewable type installation works are in progress at 11 Airports/ and also causes pollution. Locations. In line with the above, AAI has signed MoU with Solar

S. No Type of Plant Mode Commissioned Under Progress Capacity (KWp) (KWp) 1 Roof Top CAPEX 9005 1294.4 RESCO 850 0.0 2 Ground CAPEX 17290 5230 Mounted RESCO 3000 1000 Total 30145 7524.4 SAY 30.14 MWp 7.52 MWp

AAI has already generated approximately 410 lakh units from the commissioned plants, details of the station wise generation up to April '2018 is as below :- Total Generation from Solar PV Plant upto April' 2018

S. Name of Airport Solar Plant Total S. Name of Airport Solar Plant Total No. Capacity generation No. Capacity generation (Units) (Units) 1 Rajiv Gandhi Bhawan 250 2026032 20 Hyderabad 500 750247 2 Raipur 100 607009 21 Ahmedabad 700 1499643 3 Bhopal 100 784648 22 RED Office & 103 692812 ATS - Mumbai 4 Indore 100 566860 5 Guwahati - I 50 233067 23 Bagdogra 50 69160 6 Bhubaneswar 100 623892 24 Bhuj 230 392564 7 Amritsar 400 1328099 25 Jodhpur 100 107448 8 Jaipur 100 403760 26 Allahabad 300 460012 9 500 1545843 27 Port-Blair 158 148965 10 Lucknow 15 88633 28 Rajkot 150 110677 11 Kolkata 2000 5402351 29 IAA, VasantKunj 200 14737 12 Calicut 750 2616103 30 IGRUA, Fursatganj 60 -- 13 Patna 219 488002 31 Jaisalmer 100 689300 14 Ranchi 250 657531 32 Chandigarh 3000 2603290 15 Chennai 1500 4333387 33 Guwahati - II 250 633211 16 100 249895 34 Kolkata 15000 9260737 17 Madurai 70 164760 35 Trichy 140 91403 18 New Ops. Office 100 238761 36 Jaipur II 1800 330300 RED - Chennai Total Capacity 30145 41037049 19 Varanasi 600 823910

23rd Annual Report 2017-18 67 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

II. Energy Conservation :- With respect to energy audit, AAI has already conducted energy audit at 56 Airports by specialized Following measures have been taken by AAI for energy e n e r g y a u d i t a g e n c i e s . O b s e r v a t i o n s & conservation:- recommendations are being implementing in phased a) Use of LED lights at Airports:- AAI is replacing old and manner as immediate measures, short terms hazardous mercury based CFL lights with LED based measures and long term measures. lights to protect the environment and drastically d) Use of Energy efficient Chillers in place of reduce the energy consumption. The work for conventional old technology Chillers. replacement of conventional light fixtures with LED fixtures at 34 Airports/ Location has already been e) Use of energy efficient Pumps. completed, which was taken up in phase -I under f) Use of energy efficient star rated Air conditioners. National LED program, launched by Sh. NarendraModi, the Hon'ble Prime Minister of India. g) Use of Variable frequency drive (VFD) for various applications. b) MoU with M/s EESL:- AAI has signed MoU with EESL (Energy Efficiency Services Limited, A JV of PSU under h) Use of APFC panels for unity power factor. Ministry of Power) for replacement of balance existing i) Use of BMS and sensors for operation of HVAC system conventional lights with energy efficient LED lights j) Use of LED taxi light. under phase-II. c) Para 22(g) & (h) of the New Civil Aviation Policy states III. Pollution Control Measures that Airports will be encouraged to use Fixed Ground AAI has taken following steps to reduce pollution:- Electrical Power (FGEP) and Pre-Conditioned Air a) Sewage treatment plants:- AAI has set up sewage (PCA) units and that all Airports to undertake energy treatment plants at airports for management of audit and adopt an energy conservation plan. waste disposal and use of the treated recycled water In compliance to the above, use of Fixed Ground for gardening, flushing in toilets and for use in the Electrical Power (FGEP) & Pre-Conditioned Air (PCA) HVAC system to minimize the usage of fresh water. units will be considered in the new airport buildings Sludge as a final product with water is used in the where new rotunda and aero bridges are being gardening as compost/fertilizer.Through this provided. It is not feasible to provide FGEP& PCA in the process, AAI is trying to minimize the pollution of existing infrastructure since the existing aero bridges natural water bodies and also conserve on are not capable of taking the load of FGEP & PCA. consumption of water. However, feasibility of providing independent FGEP & List of Airports, where STP is provided along with the PCA units through ground handling agents (GHA) is details of type of technology is given below:- being explored.

S. No Airport Sewage Treatment Plant (STP) Capacity (KLD) Technology used 1 Ahmedabad 500 FMR (Fluidized Media Reactor) 2 Amritsar 600 SAFF (Submerged Aerobic Fixed Film Reactor) 3 Aurangabad 130 MBBR (Moving Bed Biological Reaction) 4 Belagavi 50 MBBR (Moving Bed Biological Reaction) 5 Bhopal 140 FABR (Fluidized Aerobic Bed Reactor) 6 Bhubaneswar 150 FBR (Fluidized Bio Reactor), (Thermax product) 7 Calicut 500 MBBR (Moving Bed Biological Reaction) 8 Chandigarh 600 MBBR (Moving Bed Biological Reaction) 9 Chennai 2000 Submerged Package Bed Reactor (SPBR) / Film Based Fixed Bed Bio Reactor (FBFBBR) 10 Coimbatore 150 In Planning Stage 11 Dehradun 50 MBBR (Moving Bed Biological Reaction) 12 Delhi; Safdarjung 125 MBBR (Moving Bed Biological Reaction) 13 Goa 300 MBBR (Moving Bed Biological Reaction) / FMR (Fluidized Media Reactor)

68 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

S. No Airport Sewage Treatment Plant (STP) Capacity (KLD) Technology used 14 Gondia 75 (Residential) SAFF (Submerged Aerobic Fixed Film Reactor) / 20 (Operational) MBBR 100 (NIATAM) 15 Hubballi 50 MBBR (Moving Bed Biological Reaction) 16 IGRUA, Fursatganj 140X2 Units 80 KLD in Planning Stage 17 Indore 140 FABR (Fluidized Aerobic Bio reactor 18 Jaipur 150 MBBR (Moving Bed Biological Reaction) 19 Jaisalmer 50 Septic tank with bio aerobic filter for filtration of effluent. 20 Jammu 200 Soil Bio Technology (SBT) 21 Khajuraho 50 MBBR (Moving Bed Biological Reaction) 22 Kishangarh 60 SBT (Soil Bio Technology) 23 Kolkata 750 x 2 units Extended Aeration type 24 Lucknow 160 SBT (Soil Bio Technology) 25 Madurai 200 FAB (Fluidized Aerobic Bio reactor 26 Mangalore 150 FAB (Fluidized Aerobic Bio reactor 27 Mysore 50 Extended Aeration System 28 Pudduchery 20 FAB (Fluidized Aerobic Bio reactor 29 Raipur 200 MBBR (Moving Bed Biological Reaction) 30 Rajahmundry 60 MBBR (Moving Bed Biological Reaction) 31 Ranchi 225 ASP (Activated Sludge process) 32 Srinagar 150 Fluidized Aerobic Bio Reactor (FABR) 33 Tirupati 150 MBBR (Moving Bed Biological Reaction) 34 Trichy 20 1. Screening °ritting 2. Fluidized Aerobic bio reactor & Settling Tank 3. Chlorination & Filtrations 35 Trivandrum 500 ASP (Activated Sludge process) 36 Udaipur 120 SBT (Aerobic reaction based soil Bio-filter treatment) 37 Vadodara 200 SBT (Soil Bio Technology) 38 Varanasi 150 FAB (Fluidized Aerobic Bio Reactor) 39 Vijayawada 200 MBBR (Moving Bed Biological Reaction) 40 Visakhapatnam 180 MBBR (Moving Bed Biological Reaction)

Further, STPs are also being planned, in Airport Expansion Projects, along with capacity increasing at various airports including Jaipur, Patna, Dehradun, Lucknow, Jabalpur, Chennai, Trichy, Vijaywada, Guwahati, Leh, Coimbatore, Thiruvananthapuram.

23rd Annual Report 2017-18 69 70 23rd Annual Report 2017-18 Financial Statements of Airports Authority of India

Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

23rd Annual Report 2017-18 71 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

PERFORMANCE AT A GLANCE

PARTICULARS UNITS 2017-18 2016-17 2015-16 2014-15 2013-14

SOURCES OF FUNDS Paid up Capital ` in Crores 656.56 656.56 656.56 656.56 656.56 Grants " 99.17 26.72 32.70 39.65 39.15 Loans - Others " 37.43 39.78 545.21 1,287.40 1,657.21 Non Current Liabilities " 8,456.89 7,307.96 7,280.95 5,216.46 1,980.64 Reserves & Surplus " 14,170.89 14,372.10 12,381.25 10,760.05 9,279.22 TOTAL " 23,420.94 22,403.12 20,896.67 17,960.12 13,612.78 APPLICATION OF FUNDS Fixed Assets (Less Deprec.) " 7,757.89 7,679.77 7,581.69 8,247.72 8,653.95 Work in Progress " 1,574.65 1,661.25 1,601.00 1,442.22 1,403.61 Investments " 1,715.47 1,715.47 1,151.15 1,101.15 1,096.13 Other Non Current Assets " 6,897.73 5,433.39 5,740.78 3,387.47 638.68 Working Capital " 2,894.05 3,602.61 2,958.02 2,298.65 752.75 Deferred Tax Asset (Net) " 2,581.14 2,310.63 1,864.03 1,482.91 1,067.66 TOTAL " 23,420.94 22,403.13 20,896.67 17,960.12 13,612.78

INCOME & PROFIT Revenue " 12,976.96 12,542.01 10,824.50 9,284.98 8,170.04 Expenditure " 8,560.02 7,984.40 7,127.15 6,493.57 5,649.73 Profit before tax " 4,416.94 4,557.61 3,697.35 2,791.41 2,520.31 Provision for tax " 1,885.81 1,888.28 1,541.10 1,247.44 1,146.95 Provision for Deferred Tax (Asset) " (270.51) (446.60) (381.11) (415.25) (67.70)

Profit after tax " 2,801.64 3,115.93 2,537.36 1,959.22 1,441.06 APPROPRIATION General Reserve " 1,072.76 1,194.59 963.76 873.97 647.78 Specific Reserve " 716.89 796.26 657.44 617.46 446.55 Dividend(incl.interim dividend) " 840.50 934.78 761.21 391.85 288.00 Tax on Dividend " 171.49 190.30 154.95 75.94 58.73 TOTAL " 2,801.64 3,115.93 2,537.36 1,959.22 1,441.06 Special Dividend for FY 2016-17 " 1,654.11 - - - - Tax on Dividend for FY 2016-17 " 336.74 - - - - Appopriation from General Reserves " 1,990.85 - - - -

NET WORTH " 14,827.45 15,028.66 13,037.81 11,416.61 9,935.78 (Share Capital + Reserves) CAPITAL EMPLOYED " 10,651.95 11,282.38 10,539.71 10,546.37 9,406.70 (Net Fixed Assets + Working Captial)

Current Assets " 8,094.55 7,980.70 7,318.69 7,150.88 6,905.06 5,200.50 4,378.09 4,360.67 4,852.23 6,152.31 Current Liabilities " Working Capital " 2,894.05 3,602.61 2,958.02 2,298.65 752.75

72 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

OTHER HIGHLIGHTS UNITS 2017-18 2016-17 2015-16 2014-15 2013-14

Gross Addition to Fixed Assets ` in Crores 1724.07 1,626.21 763.90 1,015.19 681.44 Sundry Debtors less Provision " 1,211.21 1,868.79 1,977.41 2,320.80 1,785.56 No. of employees in position Nos. 17,536 17,484 17,370 17,465 18,036 Aircraft Movements Nos. '000s 2,324.55 2,049 1,793 1,603 1,537 Passenger Movements (**) " 136,731.39 113,021 92,817 78,895 71,759 Cargo Handled (**) Tons'000s 920.26 808 724 681 638

RATIOS

Profit After Tax to Net Worth Percentage 19 21 19 17 15 Profit Before Tax to Capital Employed " 41 40 35 26 27 Profit After Tax to Capital Employed " 26 28 24 19 15.32 Turnover to Capital Employed " 121.83 111.16 102.7 88.04 86.85 Current Ratio Ratio 1.56:1 1.82:1 1.68:1 1.47:1 1.12:1 Debt Equity Ratio " -Total debts to Equity " 0.003 0.03 0.10 0.14 0.17 -Long Term Debts to Equity " 0.003 0.003 0.04 0.11 0.17 Profit Before Tax to Total Revenue Percentage 34.04 36.34 34.16 30.06 30.85 Profit After Tax to Total Revenue " 22 25 23 21 18 Average Debt Collection Period Days 169 200 202 213 194

No. of Aircraft Movements Nos. 133 117 103 92 85 per employee Revenue per employee ` in ' 000 7,400 7,173 6,232 5,325 4,496

Revenue Exp. Per employee ` in ' 000 4,881 4,567 4,103 3,724 3,109

ANNUAL PLAN Plan Outlay ` in Crores 2,517.82 1,974.00 1,900.00 1,576.56 1,336.00

Actual Capital Expenditure ` in Crores 2504.38 2054.00 1757.00 1399.87 1158.00

FINANCED AS UNDER: Internal Resources Utilised " 2,018.44 1,842.60 1,499.96 1,224.12 972.12

North Eastern Council Grant " 20.00 35.00 20.50 20.50 16.70 RCS Grant " 235.61 - - - - Budgetary Grant in aid " 187.13 75.07 81.34 120.50 93.85 Commercial Borrowings " - - 67.50 - - Others " 43.20 101.33 87.70 34.75 75.33

TOTAL " 2,504.38 2,054.00 1,757.00 1,399.87 1,158.00 (**) Excluding JVC & private airports

23rd Annual Report 2017-18 73 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

BALANCE SHEET as at March 31, 2018 (` in Crores) Note Particulars FY 2017-18 FY 2016-17 No. I EQUITY AND LIABILITIES 1. Capital (a) Capital 2 656.56 656.56 (b) Reserves and Surplus 3 14,270.06 14,398.82 14,926.62 15,055.38 2. Non-Current Liabilities (a) Long-Term Borrowings 4 37.43 39.78 (b) Other Long Term Liabilities 5 772.30 662.98 (c) Long-Term Provisions 6 7,684.59 6,644.98 8,494.32 7,347.74 3. Current Liabilities (a) Trade Payables 7 498.17 345.03 (b) Other Current Liabilities 5 2,640.77 2,774.14 (c) Short Term Provisions 6 2,061.56 1,258.92 5,200.50 4,378.09 Total 28,621.44 26,781.21

II ASSETS 1. Non-Current Assets (a) Fixed Assets (i) Tangible Fixed Assets 8 7,750.46 7,669.50 (ii) Intangible Assets 9 7.43 10.27 (iii) Capital Work-in-Progress 10 1,572.65 1,651.55 (iv) Intangible Assets Under Development 11 2.00 9.70 9,332.55 9,341.02 (b) Non-Current Investments 12 1,715.47 1,715.47 (c) Deferrred Tax Assets (Net) 13 2,581.14 2,310.63 (d) Long-term Loans and Advances 14 6,897.73 5,433.39 20,526.89 18,800.51 2. Current Assets (a) Inventories 15 101.62 95.05 (b) Trade Receivables 16 1,211.21 1,868.79 (c) Cash and Cash Equivalents 17 4,483.77 5,042.90 (d) Short-term Loans and Advances 14 1,634.03 295.60 (e) Other Current Assets 18 663.92 678.36 8,094.55 7,980.70 Total 28,621.44 26,781.21 Statement of Significant Accounting Policies The Notes from 1 to 46 are an integral part of these Financial statements Sd/- Sd/- Sd/- Sd/- (R. Tulasi Mahalakshmi) (Pankaj Jain) (S.Suresh) (Dr. Guruprasad Mohapatra) Company Secretary ED (F&A) Member (Finance) Chairman New Delhi 20th June, 2018

74 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

STATEMENT FOR PROFIT AND LOSS for the period ended March 31, 2018 (` in Crores) Note Particulars FY 2017-18 FY 2016-17 No. Income I. Airport Navigational Services 19 3,495.34 2,972.89 II. Airport Services 20 4,257.77 3,483.98 III. Non-Aeronautical Airport Services 21 1,451.01 1,304.97 IV. Cargo Revenue 22 0.00 261.95 V. Airport Lease Revenue 23 3,102.57 3,836.75 VI. Other Income 24 670.27 681.47

VII. Total Revenue (I+II+III+IV+V+VI) 12,976.96 12,542.01

VIII. Expenses

Employee Benefits Expenses 25 3,647.33 2,789.08 Operating Expenses 26 1,597.71 1,509.85 Administrative and Other Expenses 27 798.37 1,272.02 Finance Costs 28 44.15 98.37 Depreciation and Amortization 29 1,461.45 1,432.79 Security Expenses 30 1,011.01 882.28

Total Expenses 8,560.02 7,984.40

IX. Profit before exceptional and 4,416.94 4,557.61 extraordinary items and tax(VII-VIII)

XII. Exceptional Items 0.00 0.00

XIII. Profit before tax(XI-XII) 4,416.94 4,557.61

XIV. Tax Expenses:

(1) Current Tax 1,885.81 1,888.28 (includes previous year tax of ` 9.19 crores (FY 2016-17- ` 174.96 Crores)

(2) Deferred Tax (270.51) (446.60)

XV. Profit/(Loss) for the period (XIII-XIV) 2,801.64 3,115.93

Balance Carried to Balance Sheet 2,801.64 3,115.93

Statement of Significant Accounting Policies The Notes from 1 to 46 are an integral part of these Financial statements Sd/- Sd/- Sd/- Sd/- (R. Tulasi Mahalakshmi) (Pankaj Jain) (S.Suresh) (Dr. Guruprasad Mohapatra) Company Secretary ED (F&A) Member (Finance) Chairman New Delhi 20th June, 2018

23rd Annual Report 2017-18 75 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

1. SIGNIFICANT ACCOUNTING POLICIES intended use and is net of credit availed in respect of any taxes, duties, capital grant receipts. 1. Basis of Preparation of Financial Statements 2.1.3 The items of property, plant and equipment are 1.1 (i) The financial statements are prepared under reviewed from the component accounting historical cost convention on accrual basis as per approach and the parts/ components with the provisions of Airports Authority of India Act, significant cost and separate useful life is identified 1994 (No.55 of 1994) and rules and notification as per their carrying cost. made there under, and in accordance with 2.1.4 Spare parts are recognised as property, plant and generally accepted accounting principles and the equipment's when they meet the definition of mandatory applicable accounting standards property, plant and equipment. Otherwise, such issued by ICAI. items are classified as inventory. (ii) The Accounts are presented in the format as 2.1.5 Subsequent costs are included in the asset's notified by the Government vide Notification No. carrying amount or recognised as a separate asset, 815 dated 31st March 2014 under Airports as appropriate, only when it is probable that future Authority of India (Annual Report and Annual economic benefits associated with the item will Statement of Accounts) Rules, 2014. flow to the entity and the cost of the item can be (iii)All assets and liabilities have been classified as measured reliably. current or non-current. Based on the services 2.1.6 Capitalization is carried out in terms of the rendered and their realization in cash and cash Capitalization Policy of AAI. Brief gist is as follows:- equivalents, the operating cycle has been ascertained as 12 months for the purpose of a) Construction Works (Project)- Capitalization is current and non-current classification of assets done from the time the project is ready for and liabilities. Figures for previous periods have intended use. been regrouped/ reclassified wherever necessary b) Equipment relating to Airport, Cargo, Security & for uniformity in presentation. IT and CNS Equipments not requiring 1.2 Use of Estimates Calibration: Capitalization is done from the date of installation, testing and commissioning. The preparation of financial statements requires the management to make estimates and assumptions c) CNS Equipment's requiring Calibration -ILS, that affect the reported amount of assets, liabilities, RADAR, VORs, ADS-B: To be capitalized from the revenue, expenses and disclosure of contingent date the flight calibration is completed as liabilities as at the date of the financial statements. certified by FIU or immediately after 3 months Management believes that these estimates and from the date of installation as certified by assumptions are reasonable and made on prudent DRC/Suppliers whichever is earlier. basis taking into account all available information, 2.1.7 Part completion of works / projects and put to use however the actual results could differ from these are capitalized based on the technical assessment. estimates and such differences are recognized in the 2.1.8 Expenditure not represented by AAI Assets is period in which the results are crystallized. charged off as Revenue expenses. 2. Property, Plant and Equipment 2.1.9 Pre-project expenditure in case of abandoned 2.1 Assets works and expenditure incurred for foreclosed and 2.1.1AAI has adopted the cost model of recognition to abandoned works are charged off as Revenue measure the Property, Plant and Equipment. expenses. Consequently, all Property, Plant and Equipment are 2.1.10 Fixed Assets which have been fully depreciated, are carried at its cost less accumulated depreciation and shown at residual value of Re.1/- accumulated impairment losses, if any. 2.1.11 Any non-monetary asset acquired from State 2.1.2 The cost of an item of Property, Plant and Equipment Government free of cost is valued at nominal value comprises its purchase price, including import duties of Re.1/- for each type of asset. and non-refundable taxes, after deducting trade 2.1.12 Wherever land is sold / transferred / disposed-off discounts and rebates, any directly attributable and the specific value of such land is not available, it expenditure to bring the Property, Plant and is valued at average cost of acquisition, except in Equipment to the location and making it ready for its cases where it is acquired free of cost.

76 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

2.1.13 In case of joint fixed assets to the extent of AAI's 2.4.2 Depreciation is charged at 100% in case assets are share in such assets is accounted in proportionate to used in a financial year for 180 days or more where as the cost incurred and depreciation charged if the assets are used for less than 180days the accordingly. depreciation will be equivalent to 50% of the 2.1.14 Asset individually costing less than ` 5000/- are depreciation of the financial year. charged off to Revenue expenses. 2.4.3 Depreciation on Temporary Buildings, Security 2.2 Construction Period Expenses on Projects Fencing and Intangible assets is charged at 100% 2.2.1Direct revenue expenditure of exclusive Project irrespective of the number of days in use. Division handling capital projects are capitalized 2.4.4. Lands taken on lease by AAI are amortized over the along with the completion cost of the work(s). lease period and in case where the lease period is not 2.2.2 The interest on mobilization advance in respect of available, such costs are amortized over a period of project is set off against the project expenses. 60 years. 2.2.3 Interest on borrowings for projects is capitalized up 2.4.5 The residual value and the useful life of an asset is to to the date of capitalisation. be reviewed at least at each financial year-end and, if expectations differ from previous estimates, the 2.3. Intangible Assets change(s) should be accounted for as a change in an 2.3.1 Computer Software (not being an embedded accounting estimate in accordance with AS 5, "Net software in the equipment) which is put to use and is Profit or Loss for the Period, Prior Period Items and expected to provide future enduring economic Changes in Accounting Policies". benefits is recognized as Intangible Assets and amortized on straight line basis over a period of five 2.5. Impairment of Assets years or licence period of the software whichever is As at each balance sheet date, the carrying amount of earlier. However where such computer software is cash generating units/assets is tested for still in development stage, costs incurred during the impairment so as to determine: development stage of such software are accounted a) the provision for impairment loss, if any required; as "Intangible Assets Under Development". or the reversal, if any, required of impairment loss 2.3.2 Expenditure on Research & Development, other than recognized in previous periods. on capital account, is charged to revenue. b) Impairment loss is recognized when the carrying 2.4. Depreciation amount of an asset exceeds recoverable amount. 2.4.1 Depreciation on fixed assets is calculated on a 2.6. Physical Verification of Fixed Assets straight-line basis using the rates arrived at based on The Physical Verification of Fixed assets are carried the useful lives estimated by the management. The out as under:- following rates are used to provide depreciation on Big Airports (including ATC centers/Security/Cargo its fixed assets. units): Every 3 years. Depreciation rates Medium Airports: Every 2 years. Asset Type Rates(SLM) Small Airports (includes ACS, CHQ, CATC, RCDU, Runways, Taxiways and Aprons, Roads, 13% CRSD, FIU, EMO, and RHQ (Administrative offices): Bridges & Culverts Every year. Plant and Machinery /Electrical installations 11% X-ray Baggage 11% 3. Investments Tools & Equipment 20% Investments which are readily realizable and Buildings -Terminal Buildings & others 8% intended to be held for not more than one year from Buildings -Residential 5% the date on which such investments are made are Buildings Leasehold 8% classified as Current Investments. All other Boundary wall (Operational) 8% investments are classified as long-term investments. Boundary wall (Residential) 5% Long term investments are carried at cost. Provision Office equipment 18% is made for diminution other than temporary, in the Furniture and fixtures 20% value of such investments if any. CFT & Firefighting equipment 13% 4. Trade Receivables Aircraft 10% Other Vehicles 14% Debt more than 1 year old recoverable from parties Computers, IT Hardware and accessories 20% other than Government Departments (including

23rd Annual Report 2017-18 77 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

State Governments) are considered doubtful and are translated at exchange rates prevailing as at provided for. the end of reporting date. a) In cases where the matter has been referred to (iv) Any gains or losses arising due to differences in arbitration / litigation/ disputed, necessary exchange rates at the time of translation are provision is made in the accounts irrespective of accounted for in the statement of P&L either the period of debt. under the head foreign exchange fluctuation or b) Security Deposit available has not been interest cost as per the case. considered while making the provision for 8. Revenue Recognition doubtful debts. (i) Revenue is recognized as the services are 5. Inventories rendered on accrual basis and is net of service (i) Stock / Spares consumed during the year are tax/GST. charged as revenue expenditure. (ii) Bills are raised at the time when and to the extent (ii) Stock at year end (except store/spare with unit there is no significant uncertainty as to its cost of ` 5000 and less) is valued at cost price on measure ability and ultimate realization. FIFO basis for a period of five years from the date (iii) In respect of cases under legal disputes / PPE Act, of receipt. Thereafter the net realizable value is Interest on delayed payments, Cargo Demurrage worked out as under and is shown at cost or net charges (except where bills are raised on realizable value whichever is less: Airlines/Agencies), Insurance Claims, Interest on 6th year 70% of the cost Staff advances, etc. are accounted on receipt basis. 7th year 40% of the cost (iv) Custom Duty Exemption certificates received 8th year onwards 10% of the cost. under 'Serve India Scheme' as well as EPCG (iii) Unconsumed stock of store/spare as on 1.4.2005 Licenses are accounted as income in the year of is valued at 10% of the cost. receipt. However unutilized portion of expired 6. Grants& Subsidies Scripts/Licenses if any is charged off in the period Grants/Subsidies received from the Government and in which the results are crystallized. Foreign Financial Institutions for acquisition of assets (v) In respect of Deposit Works undertaken by AAI, under agreements approved by the Government are income accrued as departmental charges is treated as Capital Grants. Grants are deducted from accounted for on receipt/ lodging of the final the gross value of the assets at the time of claim. capitalisation of assets in arriving at its book value. (vi) Income and expenditure upto Rupees five lakhs Till the completion of the work Grant will be shown as in each case pertaining to previous years are a reduction from the WIP of the concerned work. accounted for in the current year. When the grant is equal to the cost of the asset, the 9. Special Repairs (applicable in respect of ongoing asset is shown in the balance sheet at nominal value works as on 1.4.2017) at Re.1/-. ( ) 7. Foreign Currency Translation i Special Repair Works on Runways, Taxiways and Aprons etc to restore Pavement Classification (i) Transactions in foreign currency are recorded at Number (PCN) value to their original level which the exchange rates prevailing at the date of may sometimes result in incidental increase in transactions except the balance in Exchange PCN is charged off to P&L A/c. Earners Foreign Currency Account which is accounted for at the rate prescribed for such (ii) The expenditure on refurbishment of CFTs are Account treated as special repairs and charged off during the year of expenditure. (ii) Non-Monetary items denominated in foreign currency (such as Fixed Assets etc) are valued at (iii)Initial expenditure on creation of RESA is treated the exchange rate prevailing on the date of as Capital expenditure and subsequent transaction. expenditure is charged off to P&L account. (iii) Monetary Items denominated in foreign 10. Taxes on Income currencies (such as Loans, Cash, Bank balances Provision for current tax is made as per the provisions etc outstanding at the end of reporting period, of the Income Tax Act, 1961. Current Tax Provision is

78 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

adjusted against Advance Tax on the basis of order of Employment, Govt. of India respectively based on Commissioner Income Tax (Appeals) received a fixed percentage of the eligible employee's during the year. salary and charged to Statement of Profit and 11. Deferred Tax Loss. Deferred tax Liability/Asset resulting from “timing b) AAI operates defined benefit plans for Gratuity. difference” between book and taxable profit is The cost of providing such defined benefits is accounted for considering the tax rates and laws that determined using the projected unit credit have been enacted or substantively enacted on the method of actuarial valuation made at the end of Balance Sheet date. The Deferred Tax Asset is the year and administered through respective recognized and carried forward only to the extent Trusts. Actuarial gains/losses are charged to that there is a reasonable certainty that sufficient Statement of profit and Loss. taxable income will be available in future against c) Obligations on Compensated Absences, Welfare which such deferred tax assets can be realized. benefits, Post-Retirement Medical benefits for 12. Employee Benefits retired employees and resettlement benefits are provided using the projected unit credit method 12.1Short Term Benefits of actuarial valuation made at the end of the year. Short Term Employee Benefits are accounted for in 13. Others the period during which the services have been rendered. (i) The specific reserves are utilized as per utilization of specific reserves guidelines approved by Board. 12.2Post-Employment Benefits and Other Long Term Employee Benefits: (ii)Expenditure incurred on procurement of arms for CISF is treated as revenue expenditure. a) AAI's Contribution to the Provident Fund and Pension Scheme is remitted to AAI, Employee (iii) EMD / Security Deposit more than three years old Provident Fund Trust and Regional Provident and not claimed are treated as miscellaneous Fund Commissioner, Ministry of Laborand income.

23rd Annual Report 2017-18 79 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018 2 CAPITAL (` in Crores) Particulars FY 2017-18 FY 2016-17 Capital : Government of India As per last Balance Sheet 656.56 656.56 Add: Addition during the year - -

TOTAL 656.56 656.56

3 RESERVES AND SURPLUS (` in Crores) Particulars FY 2017-18 FY 2016-17 Capital Reserves As per last Balance Sheet 19.10 19.10 Add: Amount additions during the year 0.00 19.10 0.00 19.10

Capital Grants As per last Balance Sheet 26.72 32.70 Add: Received during the year 445.76 110.07 Less: Utilised/repaid during the year 373.31 116.05 99.17 26.72 Debenture Redemption Reserve As per last Balance Sheet 108.75 311.25 Less: Reserves transferred to General Reserves on Redemption of Bonds 108.75 202.50 0.00 108.75 Corporate Social Responsibility Reserve As per last Balance Sheet 60.01 60.14 Add: Addition during the year 73.61 60.06 Less: Utilised during the year 71.90 60.19 61.72 60.01 Airport Development Reserve As per last Balance Sheet 5,020.63 4,224.24 Add: Appropriation from Profit and Loss 715.18 796.39 5,735.81 5,020.63 General Reserve As per last Balance Sheet 9,163.61 7,766.52 Add: Transferred from Debenture 108.75 202.50 Redemption Reserve

Less: Appropriation for Special Dividend 1,654.11 and tax thereon* Less: Appropriation for Tax on 336.74 Special Dividend* Add: Appropriation from Profit and Loss 1,072.76 1,194.59 8,354.27 9,163.61

80 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018 (` in Crores)

Particulars FY 2017-18 FY 2016-17 Profit & Loss Account Profit for the Year 2,801.64 3,115.93

Less: Appropriations Interim Dividend Paid 647.00 560.00 Tax on Interim Dividend paid 131.71 114.00 Proposed Final Dividend 193.50 374.78 Tax on Proposed Final Dividend 39.78 76.30 Corporate Social Responsibility Reserve 1.71 (0.13) Airport Development Reserve 715.18 796.39 General Reserve 1,072.76 (0.00) 1,194.59 (0.00)

Total Reserves & Surplus 14,270.06 14,398.82

4 LONG TERM BORROWINGS (` in Crores) Long Term Current Maturities* Particulars 31.03.2018 31.03.2017 31.03.2018 31.03.2017

Unsecured Loans 8.6% Unsecured Non-Convertible A Redeemable Bonds 2018-V - 0.00 - 435.00

Loan from Foreign Financial B 37.43 39.78 2.47 2.46 Institutions-Guaranteed by GOI

Total 37.43 39.78 2.47 437.46

*Current Maturities are carried to Note No. 5: Other Current Liabilities

Unsecured Bonds (A)

Particulars Allotment Date Coupon Rate Date of Redemption A 4350 Bonds of face 17th January 2013 8.60% p.a. payable After 5 years from the date of value of ` 10 annually on 17th allotment. Accordingly this bond lakh each January series has been redeemed on 17th January 2018.

23rd Annual Report 2017-18 81 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018 B Loans from Foreign Financial Institutions: Guaranteed by Government of India Foreign Financial Total Loan Amount Interest Rate Repayment Schedule Loan End Institution Oustanding as on Date 31st March 2018 Export Development USD 4900960.76 Interest Free Half-Yearly Instalments of 20.12.2044 Canada, Canada USD 90758.54 each payable on 20th June & 20th December every year Instituto De Credito USD 1163029.95 0.25% pa payable Half-Yearly Instalments of 21.03.2024 Official(ICO), Spain on 21st March & 21st USD 96919.15 each payable September every year on 21st March & 21st September every year Total Foreign Loan Outstanding balance as on 31st March 2018 is USD 6063990.71 out of which current maturities portion amounts to USD 375355.38 and the long term loan portion thereof is USD 5688635.33 only.

5 OTHER LIABILITES (` in Crores) Particulars Non-Current Current FY 2017-18 FY 2016-17 FY 2017-18 FY 2016-17 Deposits 766.83 655.99 80.93 64.39 Current Maturity of Long Term Borrowings - 2.47 437.46 Interest Accrued not due on Borrowings - 0.00 7.59 Advances from Clients - 90.49 160.72 Creditors-Capital 5.47 6.99 416.72 257.71 Other Liabilities - - 2,050.16 1,846.27 Total 772.30 662.98 2,640.77 2,774.14

6 PROVISIONS (` in Crores) Particulars Long Term Short Term FY 2017-18 FY 2016-17 FY 2017-18 FY 2016-17 Provision For Employees 1,636.32 1,529.62 583.86 499.59 Retirement Benefits and PRP** Provision for Taxation 5,628.25 4,669.00 1,244.42 308.25 (Gross) Corporate Dividend Tax - 39.78 76.30 Proposed Dividend - 193.50 374.78 Other Provisions 420.02 446.36 0.00 0.00 Total 7,684.59 6,644.98 2,061.56 1,258.92 ** Disclosure as per AS 15 on 'Employee benefit has been made in Note No.32.

7 TRADE PAYABLES (` in Crores) Particulars FY 2017-18 FY 2016-17 For Goods and Services 498.17 345.03 Total 498.17 345.03

82 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

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23rd Annual Report 2017-18 83 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

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84 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

12 NON-CURRENT INVESTMENTS (` in Crores) Particulars Face Value Number of Equity FY 2017-18 FY 2016-17 per Equity Shares as on March Share (`) 31st 2018 (Long Term Investments (at cost)) Unquoted Trade Investments In fully paid up Equity shares of Joint Venture Companies - Hyderabad International Airport Ltd. 10/- 49,140,000 49.14 49.14 (HIAL) Bangalore International Airport Ltd. (BIAL) 10/- 49,998,000 50.00 50.00 Delhi International Airport Pvt. Ltd. (DIAL) 10/- 637,000,000 637.00 637.00 Mumbai International Airport Pvt. Ltd. 10/- 312,000,000 312.00 312.00 (MIAL) National Flying Training Institute Private 10/- 38,111,795 38.11 38.11 Ltd. (Gondia) Mihan India Pvt. Ltd (MIHAN) 10/- 9,800,000 9.80 9.80 Kannur International Airport Private Ltd. 10/- 10,000,000 100.00 100.00 Aai Cargo Logistics & Allied Services 10/- 25,000,000 25.00 25.00 Company Ltd. Chandigarh International Airport Pvt. Ltd. 10/- 494,419,295 494.42 494.42

Total-Equity Investments (A) 1,715.47 1,715.47

13 DEFERRED TAX ASSETS In compliance of Accounting Standard – 22 on “Accounting for Taxes on Income’’, the item wise details of Deferred Tax Liability (net) are as under:- (` in Crores)

Particulars As on Provided Balance as on 01.04.2017 during the year 31st March 2018

Difference between book and tax depreciation 399.18 97.94 497.12

Provision for Bad & Doubtful Debts 899.71 154.87 1,054.58

Municipal taxes 5.38 0.69 6.07

Leave Encashment/Retired employee medical 829.54 (73.44) 756.10 benefit scheme/Superannuation

Provision for resettlement of retired employees 32.13 (2.06) 30.07

Welfare (Benevolent Fund) 22.10 36.14 58.24 Upfront fees from JVCs 62.55 (3.59) 58.96

Gratuity 0.00 120.00 120.00 Provision of PRP 60.03 (60.03) 0.00

Deferred Tax Assets (Net) 2,310.63 270.51 2,581.14

23rd Annual Report 2017-18 85 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

14 LOANS AND ADVANCES (` in Crores)

Particulars Long Term Short Term FY 2017-18 FY 2016-17 FY 2017-18 FY 2016-17

Advances for Investments-JVCs 190.44 86.72 -

Advances for Capital Expenditure Secured, Considered Good 264.02 108.31 -

Advance Taxes & TDS Tax deducted at Source and Advance Income Tax 5,854.77 4,689.70 1,250.54 11.79

Advance Tax-Fringe Benefit Taxes 3.94 3.94

Goods & Services Tax 119.55 -

Balances with Customs/Excise/ Service Tax Authorities 68.15 68.15 90.30 92.94

Prepaid Expenses - 40.00 27.12 Deposits Unsecured Considered Good 140.99 128.37 -

Employee Loans

Secured, Considered Good 379.26 352.04 79.58 120.55

Advances to Suppliers/Works Unsecured Considered Good - 9.19 9.29

Amount Receivable -RCS-MOCA - 8.88 4.08

Others Unsecured Considered Good 0.11 0.11 32.05 25.89

Total 6,897.73 5,433.39 1,634.03 295.60

15 INVENTORIES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Stores and Spares 101.62 95.05

Total 101.62 95.05

86 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

16 TRADE RECEIVABLES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Over Six months : 3,295.66 3,546.07

Within Six months: 962.76 4,258.42 922.44 4,468.51 Less: Provision for Bad and (3,047.21) (2,599.72) Doubtful Debts

Total 1,211.21 1,868.79 Further Notes: (a) Secured, Considered Good 709.22 790.75 (b) Unsecured, Considered Good 501.99 1,078.04 (c) Doubtful 3,047.21 2,599.72

17 CASH AND CASH EQUIVALENTS (` in Crores)

Particulars FY 2017-18 FY 2016-17

Cash and Cash Equivalents (CFS) Balances with Banks 114.31 490.89

Cheques, Drafts on hand 0.25 0.30

Cash on hand 0.04 0.04

Remittance in transit 0.01 0.41 Imprest 1.09 1.26 115.70 492.90 Other Bank Balances

Bank Deposits 4,368.07 4,368.07 4,550.00 4,550.00

Total 4,483.77 5,042.90

18 Other Current Assets (` in Crores)

Particulars FY 2017-18 FY 2016-17

Unbilled Revenue 488.80 440.77 Dues from JVCs/Subsidiaries 58.03 34.77

Interest Accrued on Investments/ 117.02 202.74 Deposits

Losses Pending Investigation 0.07 0.08

Total 663.92 678.36

23rd Annual Report 2017-18 87 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

19 AIRPORT NAVIGATIONAL SERVICES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Route Navigation Facility 3,002.18 2,540.84 Charges (RNFC) 488.61 428.32 Terminal Navigational Landing Charges (TNLC)

Other CNS/ATM Service Revenue 4.56 3.73

Total 3,495.34 2,972.89

20 AIRPORT SERVICES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Landing, Parking & Housing (LPH) 1,068.39 890.02

Passenger Service Fees:- -Facilitation 290.53 280.36 -Security 866.89 1,157.42 736.54 1,016.90

User Development Fees

- International PAX 634.08 531.83

- Domestic PAX 893.74 1,527.82 602.90 1,134.73

Oil Throughput Revenue 216.08 189.88

Ground Handling 176.61 163.82

Extension of Service Hours 14.06 5.94

Royalty on CUTE Charges 97.38 82.70

Total 4,257.77 3,483.98

88 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

21 NON-AERONAUTICAL AIRPORT SERVICES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Rent & Services 641.34 663.46 Trading Concessions 637.22 488.38 Car Parking 110.18 95.52 Porterage 0.40 2.62 Admission Fees/Commerical Passes 29.16 20.12 Restrooms 2.79 2.70 NOC-Height Clearance 18.60 9.10 Consultancy Services 0.52 0.31 Miscellaneous Non-Aeronautical 10.80 22.75 Airport Services

Total 1,451.01 1,304.97

22 CARGO REVENUE (` in Crores)

Particulars FY 2017-18 FY 2016-17

Cargo Revenue 0.00 261.95

Total 0.00 261.95 the Cargo Revenue for FY 2017-18 has been transferred to the wholly owned AAI Subsidiary namely AAI Cargo Logistics & Allied Services Company Ltd. (AAICLASCL), AAICLASCL.

23 AIRPORT LEASE REVENUE (` in Crores)

Particulars FY 2017-18 FY 2016-17

Upfront Fees 10.37 10.37

Annual Fees:-

DIAL 1,761.47 2,634.84 MIAL 1,330.72 3,092.20 1,191.54 3,826.38

Total 3,102.57 3,836.75

23rd Annual Report 2017-18 89 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

24 OTHER INCOME (` in Crores)

Particulars FY 2017-18 FY 2016-17

Interest Income 390.93 409.50 Dividend Received from JVC 66.06 4.99 Profit on Sale of Fixed Assets 32.65 105.67 Income from Training Institutes 3.97 12.26 Miscellaneous Income 158.29 142.44 Interest and Penalties 12.71 2.53 Employee Related Recoveries 5.67 4.08

Total 670.27 681.47

25 EMPLOYEE BENEFIT EXPENSES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Pay & Allowances 2,132.76 2,011.55 Other Staff Cost 1,375.07 631.76 Contribution to Provident & 185.64 162.18 Other Funds

Less Recovery of Operational (46.15) (16.41) Support Cost -JVC/Subsidiaries

Total 3,647.33 2,789.08

90 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

26 OPERATING EXPENSES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Rent, Rates, & Taxes 7.01 5.80

Municipal Taxes 39.84 66.59 Insurance 12.73 8.20 Advertisement & Publicity 11.44 13.88

Repairs and Maintenance:- Civil Works 290.34 332.91 Electrical Works 286.02 214.95 Vehicles 14.39 16.25

Equipment & Furniture 2.32 2.63 Electronics 157.56 152.05 IT Infrastructure 89.80 840.43 67.59 786.38

Consumption of Stores and Spares 42.31 42.85

Electricity & Water Charges 420.15 403.58

Meteorological Service Charges 128.78 122.97

Upkeep Expenses 91.45 55.82

Horticulture Expenses 3.58 3.78

Total 1,597.71 1,509.85

23rd Annual Report 2017-18 91 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

27 ADMINISTRATIVE & OTHER EXPENSES (` in Crores)

Particulars FY 2017-18 FY 2016-17

11.75 6.79 Legal Expenses

Consultancy Services 30.47 24.30

Freight Charges 0.71 1.38

Postage & Courier Charges 0.83 0.83

Telephone, Fax and Internet Charges 7.75 8.31

Printing & Stationery 8.17 7.12

Lease Rental 5.74 8.36

Training Expenses 9.07 9.55

Travelling Expenses 82.73 64.32

Research & Development 0.65 6.42

Provision for Bad and Doubtful Debts 447.49 794.20

Prior Period Adjustments (net) (83.40) (5.46)

Expense On Rajya Bhasha 1.95 1.32

Grant to Training Centers 17.23 0.40

Audit Fees for CAG Statutory Audit 4.00 3.49 Fees for other Services-Audit 0.02 4.02 0.04 3.54

Hire Charges 39.16 30.56

Corporate Social Responsibility 71.90 60.19 Expenses

Watch & Ward/Security Contract 66.47 49.40

Bad Debts Written-Off 1.71 -

Collection Charges 16.31 128.87 Guarantee Fees 2.11 2.16 Arbitration Expenses 2.33 0.61

Miscellaneous 53.21 68.88

Total 798.37 1,272.02

92 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the year ended March 31, 2018

28 FINANCE COSTS (` in Crores)

Particulars FY 2017-18 FY 2016-17

Interest on Borrowings 29.85 74.94

Applicable Net Loss on Foreign 0.08 (0.44) Currency Translation

Other Financing Charges 14.22 23.88

Total 44.15 98.37

29 DEPRECIATION AND AMORTIZATION EXPENSES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Depreciation/amortisation on 1,453.84 1,426.00 Tangible Assets

Amortisation of Intangible Assets 7.61 6.79

Total 1,461.45 1,432.79

30 SECURITY EXPENSES (` in Crores)

Particulars FY 2017-18 FY 2016-17

Aviation Security Force-CISF 964.75 849.60

Other Security Agencies incl. 46.26 32.69 State Police

Total 1,011.01 882.28

23rd Annual Report 2017-18 93 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018

31 INCOME / (EXPENSES) PERTAINING TO PRIOR YEARS (NET) (` in Crores)

Particulars FY 2017-18 FY 2016-17

A. EXPENDITURE Employee Benefits Expenses (114.98) 0.06 Operating Expenses 17.79 (31.50) Administrative and Other Expenses 0.60 (5.57) Depreciation and Amortization 16.98 42.91 Expenses Security Expenses (0.03) (4.05)

Total (79.63) 1.85

B. INCOME Airport Navigational Services 0.04 0.00 Airport Services 0.00 0.44 Non-Aeronautical Airport Services (0.22) (0.63) Cargo Revenue 0.55 0.00 Airport Lease Revenue 0.00 (0.53) Other Income (4.14) (6.59) (3.77) (7.31) Total (83.40) (5.46)

94 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 32. Disclosure under AS 15(Revised) on "Employee Benefits" Defined Contribution Plan: continuous service of not less than 5 years. The AAI pays fixed contribution to Provident Fund at ceiling is ` 20 lakh w.e.f. 01.01.2017 (` 10 lakh upto predetermined rate to a separate trust, which invests the 31.12.2016). funds in permitted securities. The contribution to the fund (D) Benevolent Fund Scheme: Against contribution of for the period is recognized as expense and is charged to ` 26/- p.m. while in Service, an employee is eligible to the P& L Account. receive an amount of ` 1560/- every month for 5 Defined Benefit Plan: years from the date of superannuation. (A) Leave: AAI provides for earned leave benefit and half This scheme has been revised w.e.f. 01.01.2018, as under: pay leave to the employees which accrue annually at Against a contribution of ` 250/- per month, while in 30 days and 20 days respectively. Earned leave is service, an employee is eligible to receive an amount in encashable during service subject to keeping three slabs as under over a period of eight years on residual leave of 30 days at the time of encashment separation: and a maximum of 300 days on superannuation. a. ` 7000/- per month for a period of up to two years Unutilized Half pay leave is encashable subject to from date of superannuation; maximum of 240 days on the date of superannuation b. ` 10,000/- per month from more than two years upto /resignation or death. The liability for the same is five years; recognized on the basis of actuarial valuation. c. ` 12,000/- for more than five years and upto eight (B) Post Retirement Medical Facility: The retired years. The liability for the same is recognized on the employee and the spouse are provided medical basis of actuarial valuation. facilities on payment of one time prescribed (E) Post retirement settlement benefits: At the time of contribution subject to rendering a minimum of 10 superannuation, employees (and dependents) are years continuous service. The scheme is voluntary entitled to settle at place of their choice in India. They and recognized in Profit & Loss A/c on the basis of are eligible for transfer traveling allowance etc. as actuarial valuation on annual basis. applicable to serving employee on transfer. The (C) Gratuity: Gratuity is paid at 15 days salary for every liability for the same is recognized in Profit & Loss A/c completed year of service subject to rendering of on the basis of actuarial valuation on annual basis. i) Expenses recognized in CWIP/Statement of Profit & Loss Account (` in Crores) Particulars Gratuity Medical Benefits Post Retirement Settlement Benefits 2017-18 2016-17 2017-18 2016-17 2017-18 2016-17 Current Service Cost 13.35 12.04 157.96 153.75 17.57 17.61 Interest cost on benefit obligation 59.97 67.65 45.45 47.38 6.74 8.07 Expected return on plan assets (66.14) (71.60) - - - - Net actuarial (gain)/loss recognized in the year (55.30) (43.43) (126.32) (126.87) (22.18) (26.26) Past service cost- vested benefit recognized 479.22 - - - - - during the period Expenses for the year 431.11 (35.33) 77.09 74.26 2.13 (0.58) ii) The amount recognized in the Balance Sheet (` in Crores) Particulars Gratuity Medical Benefits Post Retirement Settlement Benefits YEAR 2017-18 2016-17 2017-18 2016-17 2017-18 2016-17 Opening Net Liability (84.89) (49.45) 610.03 587.90 92.85 100.94 Expense as above 431.11 (35.33) 77.09 74.26 2.13 (0.58) Employer's Contribution/ Benefits paid (0.16) (0.11) (56.24) (52.13) (8.10) (7.51) Employer's Contribution ------Net asset/(liability) recognized in the 346.05 (84.89) 630.88 610.03 86.88 92.85 Balance Sheet

23rd Annual Report 2017-18 95 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 iii) Changes in the present value of the defined benefit obligations: (` in Crores)

Particulars Gratuity Medical Benefits Post Retirement Settlement Benefits 2017-18 2016-17 2017-18 2016-17 2017-18 2016-17

Present value of obligation as on beginning 826.10 846.65 610.03 587.90 92.85 100.94

Interest cost 59.97 67.65 45.45 47.38 6.74 8.07 Current Service Cost 13.35 12.04 157.96 153.75 17.57 17.61 Past service cost- vested benefit 479.22 - - - - - recognized during the period Benefits paid directly by employer (0.16) (0.11) (56.24) (52.13) (8.10) (7.51) Benefits paid from Fund (56.18) (60.65) - - - - Net actuarial (gain)/loss on obligation (49.73) (39.49) (126.32) (126.87) (22.18) (26.26) Present value of the defined benefit 1,272.57 826.09 630.88 610.03 86.88 92.85 obligation as at the end of the current period

** including funds available with insurance companies. iv) Changes in the fair value of plan assets: (` in Crores) Particulars Gratuity YEAR 2017-18 2016-17 Fair value of plan assets as beginning of year 910.98 896.09 Expected return on plan assets 66.14 71.60 Contributions by employer - - Benefit paid (56.18) (60.65) Actuarial gain / (loss) 5.57 3.94 Fair value of plan assets at close of year 926.51 910.98

v) Details of Plan Assets (Gratuity) The details of the plan assets at cost as on 31st March 2018 are as follows: (` in Crores)

Description 2017-18 2016-17

Government of India securities - -

Corporate Bonds - -

Special Deposit schemes - -

Insurer managed funds 901.94 905.88

Others 24.57 5.10 TOTAL 926.51 910.98

96 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 vi) Actuarial Assumptions Principal assumptions used for actuarial valuation are: Method used - Projected unit credit (PUC) Discount rate (Gratuity/Leave/Resettlement) - 7.88% (Previous year 7.26 %) Discount rate (Post Retirement Medical Benefits) - 7.76% (Previous year 7.45 %) Expected rate of return on assets (Gratuity only) - 7.88% (Previous year 7.26 %) Future salary increase - 7 % (Previous year 7%) Attrition rate - 2 % (Previous year 2%) The management has relied on the overall actuarial valuation conducted by the certified Actuary.

33. Disclosure under Accounting Standard 18 on “Related Party Disclosures “ i) Related parties:

Name of the Subsidiaries Ownership Interest

31.03.2018 31.03.2017

1. Chandigarh International Airport Ltd.(CHIAL) 51% 51%

2. AAI Cargo Logistics & Allied Services Company Ltd. 100% 100% (AAICLASCL)

Name of the Joint Ventures Ownership Interest

31.03.2018 31.03.2017

1. Delhi International Airport Pvt. Ltd (DIAPL) 26% 26%

2. Mumbai International Airport Pvt. Ltd (MIAPL) 26% 26% 3. Hyderabad International Airport Pvt. Ltd (HIAL) 13% 13% (CAP: ` 50 crores) 4. Bangalore International Airport Pvt. Ltd (BIAL) 13% 13% (CAP: ` 50 crores) 5. National Flying Training Institute, Gondia (NFTIPL) 46% 46%

6. MIHAN India Pvt. Ltd., Nagpur 49% 49% 7. Kannur International Airport Ltd. (KIAL) 26% 26% (CAP: ` 100 crores) 8. Indian Aviation Academy Autonomous body ii) Key Management Personnel • Dr. Guruprasad Mohapatra, IAS. • Shri S. Raheja, Member (Planning) • Shri. S. Suresh, Member (Finance) • Shri Anuj Aggarwal, Member (Human Resources) • Shri A K Dutta, Member (Air Navigation Services) • Shri I N Murthy, Member (Operations) • Shri Rajesh Bhandari, Executive Director (Finance) - Upto 30.11.2017 • Shri Pankaj Jain, Executive Director (Finance) - wef. 1.12.2017 • Ms. R. TulasiMahalakshmi, Company Secretary

23rd Annual Report 2017-18 97 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 iii) Details of transactions with the related parties: (` in Crores) Particulars FY 2017-18 FY 2016-17 Annual Fee from JVCs: DIAPL 1,761.47 2,634.84 MIAPL 1,330.72 1,191.54 Addition to Equity Shares holding AAICLASCL 0.00 25.00 KIAL 0.00 50.00 CHIAL 0.00 489.32 Operation Support Cost/retirement compensationreceived : DIAPL 17.06 17.60 MIAPL 18.55 19.29 Other receipts DIAPL 2.55 0.00 MIAPL 0.00 0.19 Dividend Received from BIAL 4.99 4.99 DIAL 41.41 GHIAL 19.66 AMOUNT RECEIVABLE/PAYABLE: a. MIHAN INDIA TD (MIL) Operation support cost receivable 27.46 50.43 Amount Payable 0.00 2.70 b. CHIAL Amount receivable 1.41 (1.30) c. AAICLASCL Amount payable 69.50 0.03 Advance for Investment as on closing date MIHAN INDIA LTD(MIL) 86.72 86.72 AAICLASCL 103.71 0.00 Remuneration to Key Management Personnel 5.29 3.11

` in crore iv) Corporatization of AAI Cargo Operations (I) Cargo Revenue 139.07 As approved by AAI Board in its 168th Board Meeting (II) Cargo Expenditure 91.18 held on 14/03/2016 vide agenda item no.: 168.6, AAI Cargo Logistics & Allied Services Company Ltd. (III) Amount received by AAI on (100% subsidiary of AAI) has been incorporated on Behalf of AAICLAS 21.61 11th August, 2016 under the companies Act, 2013 for Net Payable to AAICLAS cargo and allied operations. as on 31.03.2018 69.50 During the F.Y. 2017-18, AAICLAS has commenced Similarly, Cargo segment assets (book value) as on the billing under its GSTN/PAN w.e.f. 01/08/2017. 01/04/2017 as per AAI Books of Accounts has been Taking this into account, the revenue billed by AAI for transferred to AAICLAS Company Limited through cargo operations till 31/07/2017 and in exceptional Accounting entry in lieu of equity shares to be issued by cases wherever AAI continues to raise bill after the cargo company in due course. The details in this regard 31.07.2017, the revenue portion has been passed on are as under: to AAICLAS Company Limited and the cargo Particulars As on 01.04.2017 segment Expenditure for the FY 2017-18 has also Gross block of cargo segment asset 360.05 been passed on to AAICLAS Company Ltd. through accounting entry as on 31/03/2018. The details in Accumulated Depreciation 256.34 this regard are as under: Net block of cargo segment asset 103.71 The amount of ` 103.71 crores has been shown as advance for investment in the books of accounts as on 31/03/2018.

98 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 v) INDIAN AVIATION ACADEMY (IAA): As per from Leasing of Airports'. AAI has raised a claim of decision of GOI, NIAMAR has been renamed as Indian ` 2.55 crore towards interest on shortfall in MAF from Aviation Academy (IAA) and registered as a society in DIAL during the year. July 2010 under Societies Registration Act, 1960. A v) The aeronautical tariff for DIAL for the second control MOU has been signed among AAI, DGCA and BCAS for imparting training at IAA and sharing of recurring period was implemented w.e.f. 07.07.2017. The expenditure. Pending decision with respect to revised tariff has resulted in reduction in the income proportion of expenditure to be borne by each from revenue share from DIAL in the year 2017-18. As entity, an amount of ? 1.07 crores being two third of per the approved business plan for the year 2017-18 the recurring expenditure incurred during the year AAI should have received an amount of ` 2844.68 has been shown as amount recoverable from crore as revenue share, however, due the revised DGCA/BCAS, being their share of recurring tariff order, AAI has received an amount of ` 1761.47 expenditure in the books of AAI. crore. Indian Aviation Academy building & Hostel Block at vi) As per OMDA, the operation support period of 3 years Vasant Kunj, New Delhi has been operationalized has expired on 2nd May 2009. During the year (2017- during 2017-18. The total project cost till 31.3.2018 after deducting the share of BCAS / DGCA 18) an amount of ` 35.61 crore (MIAL ` 18.55 crore amounting to ` 16.69 Crore (` 103.41 Crore (-) and DIAL ` 17.06 crore) was received from JVCs ` 43.18 Crore (BCAS) (-) ` 43.54 Crore (DGCA)) is towards retirement compensation for employees being accounted as Grant-in-Aid given to IAA in the who have not opted for absorption in terms of books of accounts of AAI for the FY 2017-18. OMDA. The balance amount of retirement compensation to be received by AAI for the period 34. Disclosure under Accounting Standard -19 on April 18 to April 2019 is ` 17.83 crore from DIAL and 'Leases' ` 19.36 crore from MIAL. vii) AAI has paid an amount of ` 1.61 crore (for both DIAL (A) OMDA OF IGI AIRPORT, DELHI AND CSI AIRPORT, and MIAL) as counter guarantee fee to Govt. of India. MUMBAI viii) With regard to DF of MIAL it is stated that under DF-I i) Existing Fixed Assets of IGIA/CSIA as on the date of account an amount of ` 483.91 crore was transferred commencement of OMDA i.e. 03.05.2006 have been leased to DIAL and MIAL on "as is where is basis". from the DF Escrow account during the financial year These assets are being shown in the books of 2017-18 and the balance under this Escrow account accounts of AAI under the head Fixed Assets. as on 31.03.2018 is ` 17.61 crore. ii) During the Finance Year 2017-18, DIAL and MIAL as a ix) Under DF-II account an amount of ` 75 crore was process of development demolished/disposed remitted to MMRC and the balance amount available certain of the fixed assets of AAI and the proceeds of under the said Escrow Account is ` 61.74 lakh. An the same were transferred to AAI. amount of ` 51 crore has been kept in Fixed Deposit (` in lakh) with Bank. Gross Block Accumulated Profit on sale x) The DF collections of DIAL was closed in the year Depreciation of Fixed Assets 2016-17, however, an amount of ` 35.31 crore had DIAL 35.25 35.25 5.58 been collected in the said DF Escrow account and the MIAL 164.42 164.42 44.76 with the order of AERA, this amount has been iii) Upfront Fees - AAI has received an Upfront fees of transferred to AAI account as grant for RCS airports ` 150 crore each from DIAL and MIAL at the time of and the DF Escrow Account stands closed. leasing out AAI airports at Delhi and Mumbai. AAI has xi) Arbitration cases with DIAL & MIAL - The matter treated these amounts as deferred revenue expenditure and to be spread over the lease period relating to utilization of custom duty scrips by DIAL & of 30 years. The total unadjusted amount as on MIAL has been referred to Arbitration by the Hon'ble 31.03.2018 on this account is ` 180.73 crore. Delhi High Court. The arbitration proceedings in respect of DIAL & MIAL are still continuing. Further, iv) As per agreement signed by AAI with DIAL and MIAL arbitration proceedings with MIAL related to the an amount of ` 3092.19 crore (DIAL ` 1761.47 crore removal of restriction on end use of the land 4.17 and MIAL ` 1330.72 crore) has been received as acres situated at F Block, AAI NAD Colony Mumbai is revenue share and this amount is recognized in the still in progress. Profit & Loss Account of AAI under the head "Income

23rd Annual Report 2017-18 99 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 xii) Dividend received from JVCs as per details given crores (Previous year ` 1844.28 crores) as on Balance below during the year :- Sheet date. Name of JVC Dividend for Amount b) AAI has export obligations to the extent of ` 329.58 Financial Year (` in crores) crores on account of concession in Custom duty DIAL 2016-17 41.41 availed under EPCG license scheme on import of Equipment/spares. HIAL 2016-17 12.29 HIAL (Interim 2017-18 7.37 37. Consolidation of Accounts: As AAI is not a Dividend) Company registered under Companies Act 2013, the requirement of consolidation of accounts of AAI, AAI BIAL 2016-17 4.99 Cargo Logistics & Allied Services Company Ltd. and Total 66.06 Chandigarh International Airports Ltd. (where AAI is xiii. Service Tax on Annual Fee from DIAL and MIAL having 51% share holding) as on 31.3.2018 is not applicable. However, the accounts of AAI Cargo Service Tax Deptt. had issued the Demand cum Show Logistics & Allied Services Company Ltd. and Cause Notice to AAI demanding payment of service Chandigarh International Airports Ltd will be ` tax amounting to 2031.68 crore on the annual fee annexed to annual report of AAI for the FY 2017-18 payable by DIAL and MIAL and the upfront fee paid and will be laid on the table of both the houses of by DIAL and MIAL to AAI. This demand was made for Parliament. the period from 03.05.2006 to 31.03.2016. The Hon'ble High Court of Delhi, on the writ petitions 38. Contingent Liabilities filed by DIAL and MIAL in the year 2008, passed the Claims not acknowledged as debts: (` in Crores) judgment on 14.02.2017 holding that the amount of annual fee payable and upfront fee paid by both the Particulars As at 31st As at 31st parties to AAI does not constitute a "franchise" and March 2018 March 2017 hence transaction between the petitioners and AAI Land cases 355.38 448.53 does not constitute taxable service. Compensation 3.16 2.92 Simultaneously, AAI filed an appeal before the claims of Accident Hon'ble CESTAT against the demand raised and the Cases under 942.30 880.05 adjudication thereof by the Commissioner of Service Arbitration Tax for the period from 2006 to 2014 amounting to Claims against 12.48 10.91 ` 1407.25 crore. Based on the judgment of the Cargo Hon'ble High Court of Delhi, the Hon'ble CESTAT has set aside the adjudication order of the Commissioner Court Cases 219.11 128.18 of Service tax for the period from 2006 to 2014. The Sales tax/Service 138.92 162.39 Commissioner of Service tax has not yet been Tax/ Municipal tax/ adjudicated for the period 2014-15 to 2015-16. After income tax etc. various personnel hearings, the case is still under Others 69.24 78.15 progress. An amount of ` 20 crore has been refunded 1,740.59 1,711.13 by Service Tax Deptt. towards pre-deposit amount TOTAL paid by AAI, for the year 2012-13 & 2013-14 (` 10 39. Guarantees executed Crore for each Financial year), for filing of appeal During the year the guarantees for ` 14.53 Crores before Hon'ble CESTAT. have been issued/renewed in favour of Electricity Distribution Companies and Department of 35. Disclosure under Accounting Standard – 28 on Telecommunication. Impairment of Assets 40. EXPENSES IN FOREIGN CURRENCIES (` in Crores) As per the assessment of the Management, there is no Material change in the position as on 31.03.2018 to further Particulars FY 2017-18 FY 2016-17 recognize or review the effect given for Impairment of Capital Goods purchase 157.39 326.15 Assets during the FY 2013-14 in the Accounts of AAI for the Spare parts 12.19 87.57 FY 2017-18. Foreign travel 5.02 8.91 36. Commitments Repayment of 2.49 2.52 a) Estimated amount of contracts remaining to be Foreign loans executed on capital account including letters of Others 77.24 0.13 credit and not provided for amounts to ` 3034.17 Total 254.33 425.28

100 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 related activities. An amount of ` 5.71 crore has been 41. Earnings in foreign exchange (` in Crores) paid by RACFT to AAI on this account till 31.03.2018. 45. Special Dividend for the F.Y.2016-17: Particulars FY 2017-18 FY 2016-17 This is with reference to directives issued by DIPAM Services 1,111.36 979.61 vide Minutes of the the Meeting of CMGIC held on 23.11.2017 that AAI should pay 100% PAT as 42. EPF Trust Dividend (including Dividend Distribution Tax) for i) EPFO vide their letter dated 30.05.2012 has raised a the FY 2016-17,and Ministry of Finance, Department demand of ` 227.17 Crores towards damages for of Economic Affairs (Budget Division) O/M No. delay in remittance of monthly contributions from F-2(7)-B(P&A)/2017 dated 26.12.2017 conveying its 04/1995 under section 14B of EPF & MP Act, 1952. approval of depositing ` 200 crore for the Viability This levy is being contested in the Honourable High GAP Funding under Regional Connectivity Scheme Court of Delhi for which decision is pending. (UDAAN) out of the total Dividend payable by AAI for ii) EPFO vide their letter No. E/DL/36478/Rec/3203- the F.Y. 2016-17. 3208/1581 dated 11.12.2014 withdrew relaxation Accordingly, AAI Board vide Resolution via granted to AAI under Para 27 (A) of the EPF & MP Act, circulation number 7/2017 dated 14th December 1952 read with para 17 (2) to maintain the Provident 2017 and Board Resolutions for Agenda item Fund in-house. AAI approached Ministry of Labour& number 178.18 dated 10.01.2018 has conveyed its Employment, Government of India for restoration of approval for the above directives of DIPAM and to relaxation granted to AAI. It was decided in a utilize the General Reserves of AAI for the same. meeting held on 29.05.2015 in presence of Ministry Accordingly, AAI has paid 100% PAT as dividend for of Labour, EPFO & AAI officials to restore the the F.Y. 2016-17 as per the details noted below: relaxation granted to AAI temporarily till the judgment of the Hon'ble High Court related to Damages issue. Again few queries were raised by Sl. No. Particulars Amount EPFO vide letters of even No. E/DL/37478 (` in Cr.) Exempted/EO/2016 dated 21.01.2016, 15.06.2016 a. Interim dividend for the FY 2016- 560.00 and 29.09.2016 which have been addressed and final 17 paid on 26.02.2017 replies submitted vide F. No. AAI/EPF/CHQ/2016-17 dated 28.11.2016. Final decision from EPFO, b. Dividend Distribution tax paid on 114.00 however, is still awaited. Interim Dividend c. Final Dividend for the FY 2016-17 374.78 43. Segment Report and Cash Flow Statement paid on 10/11/2017 Segment report and Cash Flow Statement for the d. financial year ended 31st March 2018 are annexed Dividend Distribution tax on 76.30 herewith. Final Dividend e. Special Dividend for the year 44. Regional Connectivity Scheme (RCS) 2016-17 paid on 27.12.2017 UDAN is a key component of the National Civil To GoI 1,454.11 Aviation Policy (NCAP)which was released by the To RCS Funds for UDAN 200.00 Ministry of Civil Aviation (MoCA) on 15th June 2016. AAI has been nominated as the implementing Dividend Distribution Tax on 336.74 agency for RCS UDAN. Ministry of Civil Aviation has Special Dividend on (i) + (ii) launched Regional Connectivity Scheme in Total PAT for the FY 2016-17 3,115.93 October,2016 with prime objective to facilitate /stimulate regional air connectivity by making it 46. General affordable for masses. After the 1st round of (i) Balances in advances/customer account/liability etc. successful bidding under RCS-UDAN, MoCA has are subject to confirmation/reconciliation. launched the 2nd round on 24th August, 2017. As per (ii) Losses pending investigation amounts to ` 7.76 lakh MOCA Order dated 9.5.2017, RCS will be funded by (previous year ` 7.77 lakh). creation of a Regional Connectivity Fund by imposing a RCS levy on scheduled airline operators (iii) AS per the legal opinion from our trustees IDBI w.e.f. 1.6.2017 @ ` 5000/- per flight. Trusteeship Services Ltd received on 3rd May 2013, and as notified by Ministry of Corporate affairs, GOI. AAI has raised claim amounting to ` 14.59 Crore on AAI has created a Debenture Redemption Reserve RACFT on account of expenditure incurred on RCS (DRR) for ` 402.50 crore. Out of this an amount of

23rd Annual Report 2017-18 101 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018

` 108.75 crore (previous year ` 202.50 crore) has award of works on or after 01.04.2017 and there is no been transferred from this reserve to General material impact during 2017-18. reserves on redemption of bonds amounting to ` 435 ii) As per the assessment of the management, the crore during FY 2017-18 (previous year ` 810 crore). current policy being followed in respect of useful life (iv) Superannuation Benefit Scheme: MoCA vide letter of different categories of assets and residual value no.: AV.24032/578/2015-AAI-MoCA dated 26th and the resultant depreciation rates to be continued February, 2018 has approved the superannuation for the FY 2017-18. benefit scheme proposed by AAI subject to non- iii) In respect of componentization of assets, as per the consideration of additional increments granted as initial assessment of the management, many assets unification package to the executives of AAI which is are not having major parts having significant value as sub-judice the Hon'ble High courts of Kolkata and well as different useful life less than that of the main Delhi. asset and hence in the FY 2017-18, no component Also, as per MoCA Letter no.: AV-20036/805/2015- accounting has been done. AAI-MoCA dated 6th March 2018, those employees b) Change in Provision for Doubtful Debts Policy;- who opt for Government pension based on the The existing policy for provision for doubtful debts combined service rendered in DGCA and NAA/AAI (providing for debts more than two years old) has will not eligible for any superannuation Benefit been reviewed and the same has been revised to Scheme of AAI. provide for doubtful debts of dues more than one Considering the above, the process of identifying the year old from FY 2017-18 (refer Accounting policy no. CAD pension optees who would not be eligible for 4). The impact in this regard in the accounts for FY superannuation Benefit Scheme and the 2017-18 is ` 546 crore. Quantification in this regard and the impact on (vi) Payment of Pension to Employees of AAI transferred account of additional increments granted as unified En-masse from Civil Aviation Department/DGCA to package to the executives of AAI for adjustment in National Airports Authority/AAI with less than 10 the calculations for provision for Superannuation years of Service on the date of Absorption: Benefit Scheme were in progress as on 31.03.2018, no adjustment has been made in the existing MoCA has approved payment of Government provision already made in the earlier years (` 875.72 pensionery benefits to all regular employees who crore) and no new provision for the year 2017-18 has were transferred en-masse from the erstwhile Civil been made in the books of accounts as on 31.03.2018 Aviation Department (CAD)/DGCA to NAA/AAI on considering the compensating effect in this regard. permanent absorption basis. The formation of a separate Trust to manage the Meetings were held by MoCA with AAI to deliberate Superannuation Benefit Scheme is in progress. various issues like calling options from the concerned employees for implementing the same. (v) Changes in the Accounting Policy:- The financial implication in this regard is yet to be a) Changes in Accounting Standards;- worked out. The Institute of Chartered Accountants of India has Pending finalization of the same, no effect is given in issued amendments to accounting standards AS the books of accounts as on 31/03/2018. Nos.: 2,4,6,10,13,14 and 29 applicable to non- (vii) Term loan to fund CAPEX Plan corporate entities, pursuant to issuance of amendments to accounting standards by the To fund the CAPEX programme, AAI Board in its Ministry of Corporate Affairs (September 2016) - 179th Board Meeting on 7th March, 2018 vide (28.09.2016). These amendments to come into effect agenda No. 179.11A has accorded approval to go for prospectively in respect of Accounting periods borrowings through "Line of Credit/ Term Loan" commencing on or after April 1, 2017. from the market through Bidding process not exceeding ` 1500 crore in the first tranche with a Taking this into account, the accounting policy of AAI tenor of 15 years and to seek consent / authority of applicable for the year 2017-18 has been suitably the central government. modified wherever required. Accordingly, AAI has initiated RFP for raising "Line of The following are noted: Credit/ Term Loan" for an amount of ` 1500 crore i) Whenever Replacement/Major overhauling/special from banks and financial institutions and financial repairs /capital spares meet the recognition criteria bids have been opened on 26/3/2018. of property, plant & equipment as per AS-10, the same has been prospectively adopted in respect of

102 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to Financial Statements for the period ended March 31, 2018 The approval of MoCA in this regard is awaited. services/infrastructure, the concerned State Govt. do (Viii)Provisions for rehabilitation expenses acquire land on behalf of AAI. As per bye-laws of the State Govt.(s), in most of the cases, AAI is required to • An amount of ` 445.74 crore towards provisions for bear the cost on account of expenses to be incurred rehabilitations expenses created in the earlier years for Project Affected Person (PAP) / Resettlement & was available in the books of accounts as on Rehabilitation (R&R) due acquisition of land for 31/03/2017. development of airports. Further, the above • During 2017-18 the following amounts have been cost/expenses is also borne by AAI in case of removal paid towards rehabilitation and have been adjusted of encroachment as well as rehabilitation of slum out of the amount available in provisions for dwellers to alternate location. rehabilitations expenses In view of the above, the management is of the ` 21.17 crore considered view that rehabilitation provision NangalDewat Village ` 5.17 crore created in the earlier years and remaining in the books of accounts as on 31.03.2018 i.e. ` 419.39 crore • The following are likely expenditure on has to be retained to meet the requirement towards rehabilitations in the coming year(s) rehabilitation expenses of various Airports in 2018- (a) Providing amenities at resettlement site of 19 and in the subsequent years. NangalDewat Village, Delhi ` 10.25 crore (viii) Dues payable by Customs Department/ (b) Development expenditure of NangalDewat Village, Immigration Department/CPWD: Delhi ` 6.55 crore Dues payable by Customs Department amounting to (c) resettlement fund to Govt. of Uttar Pradesh for ` 17.91 Crore, Immigration Department amounting removal/ rehabilitation of village Bhaktikeda of to ` 5.44 Crore and CPWD amounting to ` 12.91 Crore lucknow Airport ` 32.08 crore as on 31/03/2018 have been withdrawn from the • An exercise of biometric survey is being carried out Books of Accounts during 2017-18. Apart from this by the Govt. of Maharashtra for ascertaining the slum dues kept on Claim basis for these departments dwellers occupying AAI land at CSIA/Juhu Airport totaling to ` 136.76 crore. However, the total amount that may be eligible for their re-settlement at as above will be retained in Claim form to follow-up alternate site. AAI may have to incur the amount / with the concerned Departments for further cost of the biometric survey at this stage as well as recovery. contribution of AAI towards construction of (ix) Refund of Service Tax on original work tenements for the slum dwellers at alternate place. AAI for the construction work undertaken at But the details of approx. expenditure is not known Chandigarh and Jaipur Airports had filed a claim for to AAI at this stage which is likely to be in hundreds of refund of service tax on 11.11.2016 amounting to crores of rupees. ` 17,508,235 and ` 25,317,588 for Chandigarh and • In the process of fresh land acquisition for Jaipur Airports respectively. The refund application development of an airport or additional land is under process as on 31.03.2018. acquisition for expansion of existing airport

Sd/- Sd/- Sd/- Sd/- (R. Tulasi Mahalakshmi) (Pankaj Jain) (S. Suresh) (Dr. Guruprasad Mohapatra) Company Secretary ED (F&A) Member (Fin) Chairman

New Delhi Dated: June 20, 2018

23rd Annual Report 2017-18 103 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

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104 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Cash Flow Statement for the Financial Year ended 31st March, 2018 (` in Crores) YEAR ENDED PARTICULARS 2017-18 2016-17 A CASH FLOW FROM OPERATING ACTIVITIES Profit before taxation and exceptional item 4,416.94 4,557.61 Adjustments for: Depreciation, Amortisation and Impairment 1,461.45 1,432.79 Prior Period Depreciation 16.98 42.91 Financing Costs 44.15 98.37 Other Misc. Items (36.98) (114.77) Adjustment for provisions-net made during the year 164.62 (95.09) Adj for Accumulated Provision For Doubtful debts 447.49 794.20 Dividend Income from JVCs (66.06) (4.99) Interest Income (390.93) (409.50) (Profit) on Assets Sold/discarded, net (32.65) (105.67) Operating Profit before Exceptional items & Operating Capital Changes 6,025.01 6,195.86 Decrease/(Increase) in Other Operating Assets 22.19 (839.14) Increase in Operating Liabilities 414.17 330.06 Cash Generated from Operations 6,461.37 5,686.78 Direct Taxes Paid (Net of Refunds) (2,388.68) (1,918.42) Net Cash Generated from Operating Activities - A 4,072.69 3,768.36 B CASH FLOW FROM INVESTING ACTIVITIES Addition to/Purchase of Fixed Assets/CWIP/Advances for Capital Works (1,932.06) (1,542.27) Proceeds from Sale of Fixed Assets 38.89 106.66 Bank Deposits more than 3 months (net) 181.93 (795.00) Dividend Received from JVCs 66.06 4.99 Interest Received 476.66 379.23 Investments/advance for investments in joint venture companies (0.00) (28.19) Net cash Generated/ (Used) in Investing activities - B (1,168.52) (1,874.58) C CASH FLOW FROM FINANCING ACTIVITIES Proceeds from Govt./RCS in the form of Capital grants 442.75 110.07 Payment of RCS Grant to State Govt. (28.03) - Payment of Interest & other Financing charges (38.02) (114.13) Repayment of Borrowings (437.43) (880.02) Dividend paid (2,675.89) (1,042.21) Tax on dividend paid (544.75) (212.17) Net cash Generated / (Used) from Financing activities - C (3,281.37) (2,138.46) NET CHANGE IN CASH AND CASH EQUIVALENTS (A+B+C) (377.20) (244.68) Cash & cash equivalents as at the beginning of the financial year 492.90 737.58 Cash & cash equivalents as at the end of the financial year 115.70 492.90 Notes:- 1. The above Cash Flow Statement has been prepared under the 'Indirect method' as set out in the Accounting Standard -3 on Cash Flow Statements issued by The Institute of Chartered Accountants of India. 2. Bracket indicates cash outflow/reduction. 3. Figures for previous year have been regrouped wherever necessary for uniformity in presentation.

23rd Annual Report 2017-18 105 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

106 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AUDIT REPORT OF THE COMPTROLEER AND AUDITOR GENERAL OF INDIA ON THE ACCOUNTS OF AIRPORTS AUTHORITY OF INDIA FOR THE YEAR ENDED 31 MARCH 2018

We have audited the attached Balance Sheet of the Tangible Fixed Assets (Note 8) : ` 7750.46 crore Airports Authority of India (AAI) as at 31 March 2018 and (a) The above includes an amount of ` 9.32 crore on the Profit and Loss Account for the year ended on that account of capitalization of re-surfacing of runway date, and the Section 28 (2) of the Airports Authority of work at . Authority incurred the India Act, 1994 (AAI Act 1994) and the Airports Authority expenditure on re-surfacing of runway, which was of India (Annual Report and Annual Statement of charged as revenue expenditure during 2015-16 and Accounts) Rules, 2014. These financial statements include 2016-17 as per their accounting policy. However, the the accounts of 60 self-accounting units. These financial measurement of Pavement Classification Number statementsare the responsibility of the AAI's (PCN) value conducted in the year 2017-18 and found management. Our responsibility is to express an opinion increase in PCN value. Accordingly, the expenditure on these financial statements based on our audit. on re-surfacing on runway was reversed and We have conducted our audit in accordance with auditing capitalized during the year 2017-18. As the increase in standards generally accepted India. These standards PCN value was not intended and capitalization was require that we plan and perform the audit to obtain not in order. This has resulted into overstatement of reasonable assurance about whether the financial Tangible Fixed Assets by ` 8.11 crore (` 9.32 crore - statements are free from material misstatements. An audit ` 1.21 crore (depreciation charged for the year) and includes examining, on a test basis, evidences supporting consequent overstatement of Profit for the year by the amounts and disclosures in the financial statements. the same amount. An audit also includes assessing the accounting principles (b) All segment assets relating to cargo operations and its used and significant estimates made by management, as corresponding accumulated depreciation amounting well as evaluating the overall presentation of financial ` 49.34 crore transferred to AAI Cargo Logistics & statements. We believe that our audit provides a Allied Services Company Limited by AAI. However, reasonable basis for our opinion. these assets had already been transferred to Delhi Based on our audit, we report that : International Airport Private Limited (DIAL) since May (i) We have obtained all the information and 2006. This has resulted in understatement of Tangible explanations, other than the basic records of DIAL and Assets and Accumulated Depreciation by ` 49.34 MIAL (JVCs) and their JVs in order to certify the total crore. Consequently, Note No.33(iv) is also deficient revenue of DIAL and MIAL and correspondingly the to that extent. share of AAI as per Operation, Management and B. Statement for Profit and Loss Development Agreement (OMDA) (details given in Income para B(I). Airport Lease Revenue (Note No.23) "` 3102.57 (ii) The Balance Sheet and Profit & Loss Account dealt with by this report have been drawn up in the format crore approved by the Government of India under clause The above includes airport lease revenue from Delhi (g) sub section (2) of Section 41 of the AAI Act, 1994 International Airport Limited (DIAL - ` 1761.47 crore) and Airports Authority of India Rules, 2014. and Mumbai International Airport Limited (MIAL - (iii) In our opinion, proper books of accounts and other ` 1330.72 crore), for the year 2017-18. As per clause relevant records have been maintained by the AAI as 1.1 of Operation Management and Development required under Section 28 (1) of the of the AAI Act, Agreements executed by Airports Authority of India 1994 in so far as it appears from our examination of (AAI) for Delhi and Mumbai airports with the Joint such books except that : Ventures Companies (JVCs), viz., Delhi International Airport Limited and Mumbai International Airport A. Balance Sheet Limited (MIAL) respectively and the JV Cs were 1. Assets required to share their pre-tax gross revenue (DIAL - 1.1 Non-Current Assets 45.99 per cent and MIAL - 38.70 per cent) with AAI. Fixed Assets To ensure the correctness of revenue shared with AAI,

23rd Annual Report 2017-18 107 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

as per clause 11.2 of the OMDA, an independent revenue auditor was appointed by DIAL/MIAL and AAI, who certified the revenue to be shared by these JVCs with AAI. Review of records revealed that AAI is dependent on the Revenue Auditors' report (quarterly) to account for the airport lease revenue being earned from these JVCs in its books of accounts and AAI is not independently verifying the correctness of the airport lease revenue calculations. Moreover, AAI could not produce any basic records to Audit for verifying the correctness of revenue accruing to DIAL/ MIAL from their Joint Ventures and the share of revenue transferred to AAI as per OMDA. In the absence of relevant records, the veracity of airport lease revenue as reflected in the books of accounts could not vouchsafed. This issue was raised during 2014-15, 2015-16 and 2016-17 also, however, AAI could not produce any basic records to Audit for verifying the correctness of revenue accruing to DIAL/ MIAL. C. Notes to Accounts Contingent Liabilities (Note No. 38) Claims not acknowledged as debts: ` 1740.59 crore The above is understated by ` 556.59 croredue to non-disclosure of the following :

S. Particulars Amount No. (` in crore) (i) Amount demanded by Land Acquisition Officers, Jaipur for portion of intermittent 246.40 land admeasuring 43.49 acres under possession of AAI

(ii) New Delhi Municipal Council (NDMC) raised demand of property tax on Fire Station, 258.58 Runway, W/T Station and space occupied by BSF, SFC, PHL and NCC at Safdarjung Airport (iii) Demand raised by Ministry of Defence on account of land measuring 56.78 acres was 51.61 taken over for IGI Airport, Delhi Total 556.59

(iv) Subject to our observations in the preceding paragraphs, we report that the Balance Sheet and Profit & Loss Account dealt with by this report are in agreement with the books of accounts. (v) In our opinion and to the best of our information and according to the explanations given to us, the said financial statements read together with the Accounting Policies and Notes to Accounts, and subject to the significant matters stated above and other matters mentioned in Annexure to this Audit Report give a true and fair view in conformity with accounting principles generally accepted in India. (a) In so far as it related to the Balance Sheet, of the State of affairs of the AAI as at 31 March 2018; and (b) In so far as it related to the Profit and Loss Account, of theprofit for the year ended on that date.

For and on behalf of the Comptroller and Auditor General of India

Sd/- (NandanaMunshi) Director General Office of the Principal Director of Commercial Place : New Delhi Audit & Ex-officio Member Audit Board-I Dated : 27 September 2018 New Delhi.

108 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Annexure to the Audit Report of the Comptroller and Auditor General of India on the Accounts of Airports Authority of India for the year ended 31 March 2018

1. Internal Audit System (iii) Non-review of items of capital work-in-progress of The internal Audit of AAI is conducted by the separate ` 8.96 crore pending capitalization as on 31.03.2018. Internal Audit Cell headed by Executive Director and (iv) Non-reconciliation of credit balances in trade Chartered Accountants are engaged on need basis for receivables accounts needs to be reconciled. internal audit at various Regions/ Airports. During 2017- (v) The quantum of provision of rehabilitation expenses 18, against the approved audit plan of 52 units, internal amounting to ` 419.39 crore needs to be reviewed. audit wing audited 53 units. 3. System of Physical Verification of Fixed Assets 2. Internal Control System (i) Physical Verification was not carried out at Corporate The following deficiencies noticed in internal control Headquarters and Goa Airport. system needed to be strengthened. (ii) Fixed assets at Lucknow and Varanasi Airports were (i) Deficiencies like non-review of old liabilities/ not reconciled with Fixed Assets Register. withheld amount, non-review of old deposits/ dues/ 4. System of Physical Verification of Inventory recoverable/ advance received from clients, non- existence of fixed assets and spares; non-accounting (i) The Physical verification of store was not conducted of demand draft/ cash received, non-reconciliation of at Corporate Headquarters. old dues from Government parties, non- (ii) The Physical verification reports of inventory of reconciliation/ adjustment of advances given to CISF, Northern Regional Headquarters and Corporate double booking of expenditure, unbilled income, Headquarters were not made available to Audit. assets/ expenditure GL code showing credit balance 5. Regularity in payment of statutory dues and liability/income code sowing debit balance, incomplete/ no narration in general ledger, improper (i) There was delay in payment of advance tax due to maintenance of land record and treating prio0r wrong estimation of income which resulted in period expenditure as current year expenditure. payment of penal interest of ` 4.12 crore. (ii) Depiction of assets as NIL value instead of sowing it at (ii) Liability of ` 12.55 crore in Service Tax Billed but not residual value of ` 1, incomplete FAR; charging due was pending since long. depreciation with wrong depreciation rates, under (iii) There was a delay in payment of service tax, which charging of depreciation due to adopting wrong resulted into payment of interest of ` 4.91 crore. capitalization date and wrong rate of depreciation 6. IT System and wrong depiction of leasehold land. (i) Non-maintenance of supporting document of closing JVs and adjustment entries passed in SAP.

23rd Annual Report 2017-18 109 110 23rd Annual Report 2017-18 RNA TE TIO IN N H A R L A A G I I R

D P

N O

A

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FINANCIAL STATEMENTS OF CHANDIGARH INTERNATIONAL AIRPORT LIMITED

23rd Annual Report 2017-18 111 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Chandigarh International Airport Limited

Balance Sheet as at March 31, 2018 Amount in '000 Particulars Note No As at March 31, As at March 31, 2018 2017 ASSETS Non-current assets (a) Property, Plant and Equipment 2 8,668,685 8,906,366 (b) Capital work-in-progress 3 8,801 43,557 (c) Deferred Tax Assets 16 57,359 125,351 (d) Other Non Current Assets 10 43,202

Current Assets (a) Inventory 4 612 1,456 (b) Financial Assets (i) Trade Receivables 5 137,237 42,271 (ii) Cash & Cash Equivalents 6 717,242 374,372 (iii) Others 7 66,557 39,243 (c) Current Tax Assets 8 71,604 43,801 (d) Other Current Assets 9 3,370 7,300

Total Assets 9,774,670 9,583,717 EQUITY AND LIABILITIES Equity (a) Equity Share Capital 11 9,694,494 9,694,494 (b) Other Equity 12 (130,324) (270,972)

Liabilities Non-current liabilities (a) Financial Liabilities (i) Others 13 39,418 61,030 (b) Other non-current liabilities 14 10,706 13,674

Current liabilities (a) Financial Liabilities (i) Others 15 151,741 83,859 (b) Other current liabilities 17 8,636 1,632 Total Equity and Liabilities 9,774,670 9,583,717

Significant Accounting Policies 1 The notes referred to above form an integral part of the standalone financial statements

For Subhash & Associates Chartered Accountants For and on behalf of the Board of Directors

Sd/- Sd/- Sd/- Sd/- Sd/- (CA Subhash Bansal) (Avneet Kaur) (Rakesh Dembla) (S.Suresh) (Anuj Aggarwal) Proprietor Company Secretary CFO Director Director Membership No. 017035 FRN 000825N Place : Chandigarh Date : 28.08.2018

112 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Chandigarh International Airport Limited Statement of Profit and Loss for the year ended March 31, 2018 Amount in '000 Particulars Note Year Ended March Year Ended March No 31, 2018 31, 2017 Income i) Revenue From Operations 18 923,512 420,200 ii) Other Income 19 39,809 30,225 Total Income 963,321 450,425 Expenses i) Employee Benefits Expenses 20 52,173 43,263 ii) Operating Expenses 21 133,101 108,175 iii) Administrative & Other Expenses 22 31,219 20,260 iv) Security Expenses 23 204,890 183,285 v) Other Expense 24 6,857 4,756 vi) Depreciation expenses 25 326,442 316,843 Total expenses 754,681 676,581 Profit before exceptional items and tax 208,640 (226,156) Exceptional Items - - Profit Before Tax 208,640 (226,156) Tax expense 16 - Current Tax 43,202 - - Less: MAT Credit (43,202) - - Deferred Tax 67,992 (125,351) Total Tax Expenses 67,992 (125,351) Profit for the period from continuing operations 140,648 (100,805) Profit/(loss) from discontinued operations - - Tax expense of discontinued operations - - Profit from discontinued operations after tax - - I Profit for the year 140,648 (100,805) II Other Comprehensive Income i) Items that will not be reclassified to profit or loss - Remeasurements of the defined benefit plans - - Less: Income Tax on Above - - ii) Items that will be reclassified to profit or loss - - Other Comprehensive Income - - Total Comprehensive Income for the period 140,648 (100,805) Earnings per equity share : (1) Basic 0.15 (0.12) (2) Diluted 0.15 (0.10)

Significant Accounting Policies 1 The notes referred to above form an integral part of the standalone financial statements

For Subhash & Associates Chartered Accountants For and on behalf of the Board of Directors

Sd/- Sd/- Sd/- Sd/- Sd/- (CA Subhash Bansal) (Avneet Kaur) (Rakesh Dembla) (S.Suresh) (Anuj Aggarwal) Proprietor Company Secretary CFO Director Director Membership No. 017035 FRN 000825N Place : Chandigarh Date : 28.08.2018

23rd Annual Report 2017-18 113 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Chandigarh International Airport Limited Cash Flow Statement For The Year Ended March 31, 2018 Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 A. CASH FLOW FROM OPERATING ACTIVITIES Net Profit/Loss after tax 140,648 (100,805) Adjustment for:- Depreciation 326,443 316,843 Interest Income (32,728) (23,382) Fair Valuation Gain (6,857) (4,756) Finance Cost 6,857 4,756 Tax Expense 67,992 (125,351) Operating Profit before Working Capital Changes 502,355 67,304 Adjustment for:- Inventories 844 (1,456) Trade Receivables (94,966) (19,094) Loans & Advances and Other Current Financial Assets (27,315) (13,370) Loans & Advances and Other Current Assets 3,930 11,151 Current Tax Assets (27,803) (31,828) Other Non Current Asset (43,202) - Other Non-Current Financial Liability (21,612) 32,807 Other non-current liabilities (2,969) 6,030 Other Current Financial Liabilities 67,882 38,455 Provisions and Other Liabilities - (12,884) Other Current Liabilities 7,003 (2,351) Net Cash From Operating Activities 364,146 74,765 B. CASH FLOW FROM INVESTING ACTIVITIES Fixed Assets (88,761) (124,854) Capital Work In Progress 34,756 (38,711) Interest Income 32,728 23,382 Net Cash From Investing Activities (21,277) (140,183) C. CASH FLOW FROM FINANCING ACTIVITIES Share Capital & Share Application Money - 62,545 Net Cash From Financing Activities - 62,545 D. Net changes in Cash & Cash equivalents 342,870 (2,873) E. Opening Cash & Cash Equivalents (Note No 13) 374,372 377,246 F. Closing Cash & Cash Equivalents (Note No 13) 717,242 374,372

Significant Accounting Policies 1 The notes referred to above form an integral part of the standalone financial statements

For Subhash & Associates Chartered Accountants For and on behalf of the Board of Directors

Sd/- Sd/- Sd/- Sd/- Sd/- (CA Subhash Bansal) (Avneet Kaur) (Rakesh Dembla) (S.Suresh) (Anuj Aggarwal) Proprietor Company Secretary CFO Director Director Membership No. 017035 FRN 000825N Place : Chandigarh Date : 28.08.2018

114 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Chandigarh International Airport Limited Statement of Changes In Equity for the year ended March 31, 2018

Equity Share Capital Amount in '000 Balance as at April 1, 2017 Changes in share capital Balance as at during the year March 31, 2018 9,694,494 - 9,694,494

Balance as at April 1, 2016 Changes in share capital Balance as at during the year March 31, 2017 400,000 9,294,494 9,694,494

Other Equity For the year ended March 31, 2018

Particulars Share Equity Reserves and Surplus Total application Component money of Advance Retained Ind AS pending from Related Earnings transitional allotment Parties Reserve Balance at the beginning of the reporting period - - (239,931) (31,042) (270,972) Changes in accounting policy prior period errors - - - - Restated balance at the beginning of the - - - - reporting period Total Comprehensive Income for the year - 140,648 - 140,648 Share issued during the year - - - - Transfer to retained earnings - - - - - Balance at the end of the reporting period - - (99,282) (31,042) (130,324)

Other Equity For the year ended March 31, 2017

Particulars Share Equity Reserves and Surplus Total application Component money of Advance Retained Ind AS pending from Related Earnings transitional allotment Parties Reserve Balance at the beginning of the reporting period - (139,125) (31,042) (170,167) Changes in accounting policy prior period errors - - - - Additions during the year - - - - - Total Comprehensive Income for the year - (100,805) - (100,805) Any other change (to be specified) - - - - Transfer to retained earnings - - - - Balance at the end of the reporting period - - (239,931) (31,042) (270,972)

23rd Annual Report 2017-18 115 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Chandigarh International Airport Limited

COMPANY OVERVIEW The Chandigarh International Airport Ltd. (CHIAL), has statements. Actual results may differ from those estimates been incorporated on 28th January, 2010 as a joint and assumptions, due to changes in facts and venture company under Companies Act, 1956 by Airports circumstances. Management reviews estimates on an Authority of India (AAI) in association with Punjab ongoing basis using currently available information and Government through Greater Mohali Area Development any revision in the estimate is recognized in the period in Authority (GMADA) and Haryana Government through which the same is determined. Haryana Urban Development Authority (HUDA) to The financial statements are rounded off in thousands. operate and maintain Chandigarh International Airport The financial statements comply with all applicable which has come up with a new state of art International IND AS. Airport at Mohali, Punjab. As per the Joint Venture 2. Property, Plant and Equipment (PPE) Agreement, the equity contribution is in the ratio of Property, Plant and Equipment up to March 31, 2015 were 51.00%, 24.50% and 24.50% respectively by AAI, GMADA carried in the balance sheet in accordance with Indian and HUDA. AAI's contribution towards its share of equity is GAAP. The company has elected to avail the exemption construction of the New Terminal Building and allied granted by IND AS 101, "First time adoption of IND ASs" to works. GMADA and HUDA have provided land for the said regard those amounts as deemed cost at the date of the construction towards their equity contribution. CHIAL, transition to IND AS (i.e. as on April 1, 2015). has commenced commercial operations on 19th October, PPE are stated at their original cost of acquisition less 2015, the Airport Opening Date (hereinafter 'AOD'). accumulated depreciation. The cost includes cost of SIGNIFICANT ACCOUNTING POLICIES subsequent improvements thereto including taxes, 1. Basis of preparation of financial statements duties, freight and other incidental expenses related to The Ministry of Corporate Affairs (MCA) notified the acquisition and installation of the assets concerned. Companies (Indian Accounting Standards) Rules, 2015 on Advances paid towards acquisition of assets, outstanding 16 February 2015 laying down the roadmap for at each balance sheet date are shown under capital implementation of Indian Accounting Standards (Ind ASs) advances. The cost of fixed assets not ready for its to Indian Companies other than banking companies, intended use on such date is disclosed as Capital work-in- insurance companies and non-banking financial progress. companies (NBFCs). As per the roadmap, Ind ASs is Spares parts, stand-by equipments and servicing applicable to Chandigarh International Airport Limited equipments procured along with the Plant & Machinery or from the financial year commencing on or after April 1, subsequently which meets the recognition criteria, are 2017. However, CHIAL adopted Ind AS in financial year capitalized and added in the carrying amount of such 2015-16 voluntarily. item. The carrying amount of those spare parts that are The financial statements have been prepared on accrual replaced is derecognized when no future economic basis of accounting under historical cost convention, benefits are expected from their use or upon disposal. except for following financial assets and financial liabilities Other machinery spares are treated as "stores & spares" which are measured at fair value: forming part of the inventory. • Non-current financial assets such as security deposits If the cost of the replaced part or earlier inspection is not measured at fair value at initial recognition. available, the estimated cost of similar new • Non- current financial liabilities such as Security parts/inspection is used as an indication of what the cost deposits from customers measured at fair value at of the existing part/ inspection component was when the initial recognition. item was acquired or inspection carried out. The preparation of the financial statements in conformity Depreciation is provided on a Straight Line Method with Ind ASs requires management to make estimates and ('SLM') over the useful lives of the assets as per Companies assumptions that affect the reported amounts of assets Act 2013/management's estimates. Depreciation for and liabilities, revenue and expenses, and disclosure of assets purchased / sold during a period is proportionately contingent assets and liabilities at the date of the financial charged. Pursuant to this policy, the rates of depreciation determined by the Management are as set out below:

116 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Class of Asset Rate of depreciation per annum use or sell the asset Assets Rates • How the asset will generate future economic benefits of Dep. • The availability of resources to complete the asset Land 0% • The ability to measure reliably the expenditure during Aprons 19% development Roads, Bridges & Culverts (Carpeted) 19% Roads, Bridges & Culverts 31.67% Following initial recognition of the development (Non-Carpeted) expenditure as an asset, the asset is carried at cost less any Building Terminal/Other Buildings 3.17% accumulated amortization and accumulated impairment Buildings - Temporary 31.67% losses. Amortization of the asset begins when development is complete and the asset is available for use. Boundary Wall 3.17% It is amortized over the period of expected future benefit. Computers & I.T. Hardware & Access 31.67% Amortization expense is recognized in the statement of Computers & I.T. - Servers 15.83% profit and loss. Plant and Machinery/X-Ray 6.33% Baggage System During the period of development, the asset is tested for Tools & Equipments / Office Appliances 19% impairment annually. Furniture and Fixtures Office / 9.50% 4. Fair value measurement Other Than Office Fair value is the price that would be received to sell an Vehicles - Cars & Jeeps/ 11.88%/ asset or paid to transfer a liability in an orderly transaction Motor Cycles 9.50% between market participants at the measurement date. Electrical Installations 9.50% Normally at initial recognition, the transaction price is the best evidence of fair value. The assets having a cost of ` 5000 or less are charged off to However, when the Company determines that transaction expenditure in the year of payment. price does not represent the fair value, it uses inter-alia Depreciation method, useful lives and residual values are valuation techniques that are appropriate in the reviewed periodically, including at each financial year circumstances and for which sufficient data are available end. to measure fair value, maximising the use of relevant 3. Intangible Assets and Depreciation observable inputs and minimising the use of Intangible assets acquired separately are measured on unobservable inputs. initial recognition at cost. Following initial recognition, All financial assets and financial liabilities for which fair intangible assets are carried at cost less any accumulated value is measured or disclosed in the financial statements amortization and accumulated impairment losses. are categorised within the fair value hierarchy. This Intangible assets are recognized only if it is probable that categorisation is based on the lowest level input that is future economic benefits that are attributable to the asset significant to the fair value measurement as a whole: will flow to the enterprise. Computer software licenses are • Level 1 - Quoted (unadjusted) market prices inactive capitalized on the basis of costs incurred to acquire and markets for identical assets or liabilities. put to use the specific software. Operating software is • Level 2 - Valuation techniques for which the lowest capitalized and amortized along with the related fixed level input that is significant to the fair value asset. Other software is amortized, on a straight line measurement is directly or indirectly observable method, over a period of three years. • Level 3 - Valuation techniques for which the lowest Research costs are expensed as incurred. Development level input that is significant to the fair value expenditures on an individual project are recognized as an measurement is unobservable. intangible asset when the company can demonstrate: Financial assets and financial liabilities that are recognised • The technical feasibility of completing the intangible at fair value on a recurring basis, the Company determines asset so that the asset will be available for use or sale whether transfers have occurred between levels in the • Its intention to complete and its ability and intention to hierarchy by re-assessing categorisation at the end of each

23rd Annual Report 2017-18 117 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

reporting period. premium on acquisition and fees or costs that are an 5. Financial assets integral part of the EIR. The EIR amortisation is included in finance income in the profit or loss. Financial assets A financial asset includes inter-alia any asset that is cash, at fair value through other comprehensive income are equity instrument of another entity or contractual at each reporting date at fair value. Fair value changes obligation to receive cash or another financial assets or to are recognized in OCI. However, the company exchange financial asset or financial liability under recognizes interest income, impairment losses and condition that are potentially favourable to the Company. reversals and foreign exchange gain or loss in the A financial asset is recognized when and only when the income statement. On de-recognition of the financial Company becomes party to the contractual provisions of asset other than equity instruments, cumulative gain the instrument. or loss previously recognised in OCI is reclassified to Financial assets of the Company comprise cash and cash income statements. equivalents, Bank Balances, Advances to employees/ Any financial asset that does not meet the criteria for contractors, security deposit, claims recoverable etc. classification as at amortized cost or as financial assets a. Classification at fair value through other comprehensive income, is The Company classifies its financial assets in the classified as financial assets at fair value through profit following categories: or loss. Financial assets at fair value through profit or loss are fair valued at each reporting date with all the i. at amortized cost, changes recognized in the income statement. ii. at fair value through other comprehensive d. De-recognition income, and A financial asset (or, where applicable, a part of a iii. at fair value through profit or loss financial asset or part of a group of similar financial The classification depends on the following: assets) is primarily derecognised when: (a) The entity's business model for managing the • The rights to receive cash flows from the asset have financial assets and expired, or (b) The contractual cash flow characteristics of the • The company has transferred its rights to receive financial asset. cash flows from the asset or has assumed an b. Initial recognition and measurement obligation to pay the received cash flows in full All financial assets except trade receivables are without material delay to a third party under a recognised initially at fair value plus, in the case of 'pass-through' arrangement? and either (a) the financial assets not recorded at fair value through company has transferred substantially all the risks profit or loss, transaction costs that are attributable to and rewards of the asset, or (b) the company has the acquisition of the financial asset. Transaction costs neither transferred nor retained substantially all of financial assets carried at fair value through profit or the risks and rewards of the asset, but has loss are expensed in Statement of Profit or Loss. Where transferred control of the asset. transaction price is not the measure of fair value and e. Impairment of financial assets fair value is determined using a valuation method that The company recognizes loss allowances using the uses data from observable market, the difference expected credit loss (ECL) model for the financial between transaction price and fair value is recognized assets which are not fair valued through profit or loss. in Statement of Profit or Loss and in other cases spread Loss allowance for trade receivables with no over life of the financial instrument using effective significant financing component is measured at an interest method. amount equal to lifetime ECL. For all other financial The company measures the trade receivables at their assets, expected credit losses are measured at an transaction price, if the trade receivables do not amount equal to the 12-month ECL, unless there has contain a significant financing component. been a significant increase in credit risk from initial c. Subsequent measurement recognition in which case those are measured at lifetime ECL. The amount of expected credit losses (or After initial measurement, financial assets classified at reversal) that is required to adjust the loss allowance at amortised cost are subsequently measured at the reporting date to the amount that is required to be amortised cost using EIR method. Amortised cost is recognized is recognized as impairment gain or loss in calculated by taking into account any discount or

118 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

profit or loss. Interest is recognised using the time proportion 6. Stores / Spares method based on rates implicit in the transaction. Award fees and tender fees are recognised on an Stores/spares other than recognized as property, plant accrual basis in accordance with the terms of the & Equipments are treated as inventory, which are relevant arrangement. charged to the Statement of Profit and Loss as and when they are consumed. Utility charges include power and water charges which are recovered from users of such utilities and are The costs of purchase consist of the purchase price adjusted against the relevant expenses. including duties and taxes (other than those subsequently recoverable by the enterprise from the 8. Retirement and other Employee Benefits taxing authorities), freight inwards and other The employees on the roll of the company are on expenditure directly attributable to the acquisition. deputation from Airports Authority of India (AAI) as Trade discounts, rebates, duty drawbacks and other per order dated May 26, 2016 and further approval similar items are deducted in determining the costs of office order dated November 17, 2017. The statutory purchase. deductions towards retirement benefits in respect of The balance of inventory at the end of year, if any, is these employees are remitted to AAI. valued on First in First out basis. The cost of deployment of other staff on loan from AAI 7. Revenue recognition has been booked based on gross amount reimbursable to AAI in respect of those employees. Revenue is recognized to the extent that it is probable The liability for retirement and other employee that the economic benefits will flow to the company benefits are booked in AAI books for these employees. and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is 9. Taxes measured at the fair value of the consideration Current income tax received or receivable, taking into account Current income tax assets and liabilities are measured at contractually defined terms of payment and excluding the amount expected to be recovered from or paid to the taxes or duties collected on behalf of the government. taxation authorities. The tax rates and tax laws used to Aeronautical Revenue includes revenue from all compute the amount are those that are enacted or regulated charges levied at CHIAL i.e., Parking and substantively enacted, at the reporting date in the Housing, Passenger Service Fee (Facilitation countries where the company operates and generates component), User Development Fee, Extension of taxable income. Watch Hours, Fuel Throughput, CUTE, Baggage Current income tax relating to items recognized outside reconciliation system fee and Cargo is recognized at profit or loss is recognized outside profit or loss (either in the rates prescribed by Airport Economic Regulatory other comprehensive income or in equity). Current tax Authority (AERA) by order no 17/2016-17 date March items are recognized in correlation to the underlying 17, 2017 for first control period (01.04.2016 - transaction either in OCI or directly in equity. 31.03.2021), wherever applicable or at the existing Management periodically evaluates positions taken in the rates being charged by AAI. Parking charges are tax returns with respect to situations in which applicable recognised, when such services are provided. tax regulations are subject to interpretation and Passenger Service Fee (Security) is recognized as per establishes provisions where appropriate. rate fixed by Ministry of Civil Aviation (MoCA). Passenger Service fees - Facilitation and Security Deferred tax component, User Development Fee are recognised in Deferred tax is recognised on differences between the respect of each embarking passenger at a specified carrying amounts of assets and liabilities in the company's rate. financial statements and the corresponding tax bases Non-Aeronautical Revenue means all revenue streams used in the computation of taxable profit and are other than Aeronautical Revenue. The same consists of accounted for using the balance sheet liability method. (i) revenue from concessions (ii) rents and land leases; Deferred tax liabilities are generally recognised for all (iii) food and beverage concessions; (iv) utility taxable temporary differences, and deferred tax assets are charges; and (v) other non-aviation related charges generally recognised for all deductible temporary are recognized based on the terms of contractual differences, unused tax losses and unused tax credits to agreement. the extent that it is probable that future taxable profits will

23rd Annual Report 2017-18 119 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

be available against which those deductible temporary reporting period, or differences, unused tax losses and unused tax credits can • Cash or cash equivalent unless restricted from being be utilised. Such assets and liabilities are not recognised if exchanged or used to settle a liability for at least the temporary difference arises from the initial twelve months after the reporting period recognition of an asset or liability in a transaction that at All other assets are classified as non-current. the time of the transaction affects neither the taxable profit or loss nor the accounting profit or loss. A liability is current when: The carrying amount of deferred tax assets is reviewed at • It is expected to be settled in normal operating cycle each balance sheet date and reduced to the extent that it • It is held primarily for the purpose of trading is no longer probable that sufficient taxable profits will be • It is due to be settled within twelve months after the available against which the temporary differences can be reporting period, or utilised. • There is no unconditional right to defer the settlement Deferred tax assets and liabilities are measured at the tax of the liability for at least twelve months after the rates that are expected to apply in the period in which the reporting period liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively The company classifies all other liabilities as non- enacted by the balance sheet date. The measurement of current. deferred tax liabilities and assets reflects the tax 13. Provisions and contingent liabilities consequences that would follow from the manner in Provisions are recognised when the company has a which the Company expects, at the reporting date, to present obligation (legal or constructive) as a result of a recover or settle the carrying amount of its assets and past event, it is probable that an outflow of resources liabilities. embodying economic benefits will be required to settle Deferred income tax assets and liabilities are offset when the obligation and a reliable estimate can be made of the there is a legally enforceable right to offset current tax amount of the obligation. When the company expects assets against current tax liabilities, and when the some or all of a provision to be reimbursed, for example, deferred income tax assets and liabilities relate to income under an insurance contract, the reimbursement is taxes levied by the same taxation authority on either the recognised as a separate asset, but only when the taxable entity or different taxable entities where there is reimbursement is virtually certain. The expense relating to an intention to settle the balances on a net basis. a provision is presented in the statement of profit and loss 10. Earnings per share net of any reimbursement. The basic and diluted earnings per share are computed by If the effect of the time value of money is material, dividing the net profit/loss after tax, attributable to equity provisions are discounted using a current pre-tax rate that shareholders for the year by the weighted average reflects, when appropriate, the risks specific to the number of equity shares outstanding during the year. liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a 11. Cash flow statement finance cost. Cash flows are reported using the indirect method, Contingencies whereby net profit/loss before tax is adjusted for the effects of transactions of a non-cash nature and any Provision in respect of loss contingencies relating to deferrals or accruals of past or future cash receipts or claims, litigation, assessment, fines, penalties, etc. are payments. The cash flows from operating, investing and recognised when it is probable that a liability has been financing activities of the Company are segregated. incurred, and the amount can be estimated reliably. 12.Current versus non-current classification 14. Impairment of assets The company presents assets and liabilities in the balance The Company assesses at each balance sheet date sheet based on current/ non-current classification. An whether there is any indication that an asset may be asset is treated as current when it is: impaired. If any such indication exists, the Company estimates the recoverable amount of the asset. For an • Expected to be realized or intended to be sold or asset that does not generate largely independent cash consumed in normal operating cycle inflows, the recoverable amount is determined for the • Held primarily for the purpose of trading cash-generating unit to which the asset belongs. If such • Expected to be realized within twelve months after the recoverable amount of the asset or the recoverable

120 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

amount of the cash generating unit to which the asset estimates. Changes in estimates are reflected in the belongs is less than its carrying amount, the carrying financial statements in the period in which changes are amount is reduced to its recoverable amount. The made and, if material, their effects are disclosed in the reduction is treated as an impairment loss and is notes to the financial statements. recognised in the Statement of Profit and Loss. If at the 16.1 Critical accounting estimates balance sheet date there is an indication that if a The following are the critical judgements that the previously assessed impairment loss no longer exists, the Company has made in the process of applying the recoverable amount is reassessed and the asset is Company's accounting policies and that have the reflected at the recoverable amount. An impairment loss is most significant effect on the amounts recognised in reversed only to the extent that the carrying amount of the financial statement. The following are the asset does not exceed the net book value that would have estimates used during the year. been determined; if no impairment loss had been recognised. Property, Plant and Equipment: Property, plant and equipment represent a significant proportion of 15.Investments asset base of the company. The charge in respect of Long-term investments are carried at cost less provision periodic depreciation is derived after determining for diminution, other than temporary diminution in the the estimate of an assets expected useful life and the value of the investments. expected residual value at the end of its life. The Current investments are carried at the lower of cost and useful lives and residual values of company's assets fair value. The comparison of cost and fair value is carried are determined by the management at the time the out separately in respect of each investment. asset is acquired and reviewed periodically, 16.Use of Estimates including at each financial year end. The lives are based on historical experience with similar assets as The preparation of the financial statements in conformity well as anticipation of future events which may with Ind AS requires management to make estimates, impact their life, such as changes in technology. judgements and assumptions. These estimates, judgements and assumptions affect the application of Provisions: Provisions are determined based on accounting policies and the reported amounts of assets management estimate required to settle the and liabilities, the disclosures of contingent assets and obligation at the balance sheet date. liabilities at the date of financial statements and reported Contingent liabilities: Contingent liabilities are amounts of revenues and expenses during the period. disclosed on the basis of judgment of Application of accounting policies that require critical management/independent experts. These are accounting estimates involving complex and subjective reviewed at each balance sheet date and are judgements and the use of assumptions in these financial adjusted to reflect the current management statements have been disclosed in Note 16.1 Accounting estimate. estimates could change from period to period. Actual Contingent Assets: Contingent assets are disclosed results could differ from those estimates. Appropriate on the basis of judgment of management/ changes in estimates are made as management becomes independent experts. aware of changes in circumstances surrounding the

For Subhash & Associates For and on behalf of the Board of Directors Chartered Accountants

Sd/- Sd/- Sd/- Sd/- Sd/- (CA Subhash Bansal) (Avneet Kaur) (Rakesh Dembla) (S. Suresh) (Anuj Aggarwal) Proprietor Company CFO Director Director Membership No. 017035 Secretary

FRN 000825N Place: Chandigarh Date: 28.08.2018

23rd Annual Report 2017-18 121 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

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122 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

3. Capital Work- In- Progress Amount in '000 Particulars Balance as Additions/ Capitalized Balance as at April 1, Adjustments during the at March 31, 2017 during the year year 2018 Civil & Other Works* 43,393 38,474 73,066 8,801 Computer & Software 164 - 164 - Total 43,557 38,474 73,230 8,801 Amount in '000 Particulars Balance as Additions/ Capitalized Balance as at April 1, Adjustments during the at March 31, 2016 during the year year 2017 Civil & Other Works** 4,845.81 107,634 69,086 43,393 Computer & Software - 164 - 164 Total 4,846 107,798 69,086 43,557

* Civil & Other Works as on 31.03.2018 pertains to followings: 1. Expenditure for levelling of taxitrack of ` 52,08,850/- 2. Expenditure for additional signages of ` 17,49,800/- 3. Geotechnical investigation for construction of apron amounting to ` 2,16,385/- 4. Expenditure incurred for construction of apron amounting to ` 2,48,444/- 5. Expenditure incurred for SITC 31 NO HD cameras for baggage tag dispensing amounting to `11,58,280/- 6. Expenditure incurred for supply and fixing of HT/LT insulating mats in switch rooms amounting to ` 2,19,000/- ** Civil & Other Works as on 31.03.2017 pertains to followings: 1. Study of route for Metro Tunnel amounting to ` 11,50,000/- 2. Construction of Façade Systmen outside Terminal Building amounting to ` 319,91,265/- 3. Construction of Kitchen at CISF Barracks amounting to ` 23,34,073/- 4. Electrical Fittings in Administrative Block amounting to ` 7,58,195/- 5. Electrical Fittings in Pre Fab CISF Barracks amounting to ` 71,59,602/-"

4. Inventory Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Stock & Spares 612 1,456 Total 612 1,456

5. Trade Receivables Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Trade receivables 137,237 42,271 Total 137,237 42,271

23rd Annual Report 2017-18 123 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

6. Cash & Cash Equivalents Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Flexi - Deposits 19,068 263,308 Balances with Banks 3,087 9,449 Sub-total (A) 22,154 272,757 Other Bank Balances Fixed - Term Deposit 695,087 101,615 (More than 3 months but less than 12 months) Sub-total (B) 695,087 101,615 Total 717,242 374,372

7. Other Current Financial Assets Amount in '000 Particulars As at March 31, As at March 31, 2018 2017

Accrued Income 46,611 19,886 Recoverable from Parties 19,849 18,699 Security Deposits Receivable 97 657 Total 66,557 39,243

8. Current tax Assets Amount in '000 Particulars As at March 31, As at March 31, 2018 2017

Tax Deducted at Source A.Y.-16-17 (Net of Provision for Income Tax) 12,052 12,052 Tax Deducted at Source A.Y 2017-18 (Net of Provision for Income Tax) 31,750 31,750 Tax Deducted at Source A.Y 2018-19 (Net of Provision for Income Tax) 27,803 Total 71,604 43,801

9. Other Current Assets Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Service Tax Input - 4,213 GST Input 385 Prepaid Expenses 2,985 154 Leave Salary & Pay Advance - 8 Advances to Suppliers - 2,925 Advances to staff - - Total 3,370 7,300

10. Other Non Current Assets Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 MAT Credit 43,202 - Total 43,202 -

124 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

11. Equity Share Capital Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Authorized Equity shares of ` 10/- each 12,000,000 12,000,000 1200000000 equity shares

Issued, subscribed and fully paid 9,694,494 9,694,494 Equity shares of ` 10/- each

Share Capital 9,694,494 9,694,494

Reconciliation of share Capital: Particulars As at March 31, 2018 No of Shares Amount Opening Equity Shares 969,449 969,449 Add: -No. of Shares, Share Capital issued/ - - subscribed during the year Closing balance 9,694,494 9,694,494

Reconciliation of share Capital: Particulars As at March 31, 2017 No of Shares Amount Opening Equity Shares 40,000,000 400,000 Add: -No. of Shares, Share Capital issued/ 929,449,405 9,294,494 subscribed during the year Closing balance 929,449,405 9,694,494

Shares in the company held by shareholder holding more than 5 percent

Name of the Shareholder As at March 31, As at March 31, 2018 2017 Airports Authority of India (AAI) 494,419,195 494,419,195 Greater Mohali Area Development Authority (GMADA) 237,515,105 237,515,105 Haryana Urban Development Authority (HUDA) 237,515,105 237,515,105

12. Other Equity Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Retained Earnings Opening Balance (270,972) (170,167) Surplus / (Deficit) in Statement of Profit and Loss 140,648 (100,805) Ind AS Transition Reserve - Total (130,324) (270,972)

23rd Annual Report 2017-18 125 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

13. Other Non-Current Financial Liabilities Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Security Deposits 39,418 61,030 Total 39,418 61,030

14. Other Non-Current Liabilities Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Deferred Fair Valuation Gain - Security Deposits 10,706 13,674 Total 10,706 13,674

15. Other Current Financial Liabilities Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Security Deposits 84,828 34,245 Airports Authority of India 1,053 16,885 Liability of Pay & Allowances 176 - Expenses Payable 65,684 32,729

Total 151,741 83,859

16. Tax Expense Tax recognised in Statement of profit and loss Amount in '000

Particulars For the year For the year Ended March 31, Ended March 31, 2018 2017 Current income tax Current year 43,202 - Less: MAT Credit 43,202 - - Sub Total (A) - Deferred tax expense Origination and reversal of - temporary differences 67,992 (125,351) Changes in tax rate - Change in accounting policy - Sub Total (B) 67,992 (125,351) Total (A+B) 67,992 (125,351)

126 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Reconciliation of effective tax rates Amount in '000

Particulars For the year For the year Ended March 31, Ended March 31, 2018 2017 Profit before tax 208,640 (226,156) Enacted tax Rate 28.84% 30.90% Computed Expected Tax Expenses 60,172 (69,882) Tax Effect of : MAT Credit (43,202) - Others (Include Transition Reserve) (1,790) - Effect of change in tax rate* (15,179) - Current Tax Provision (A) 0 (69,882) Current year tax losses for which no deferred - (55,469) tax asset recognised Deferred tax for the temparory differences 67,338 - Effect of change in tax rate* 654 - Deferred Tax Provision (B) 67,992 (55,469) Tax Expenses recognised in profit and loss (A+B) 67,992 (125,351)

"* Includes MAT rate and enacted tax rate and, Education cess of 1% higher used in deferred tax computation"

Recognised deferred tax assets and liabilities Deferred tax assets and liabilities are attributable to the following: Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Deferred Tax Liability Property, plant and equipment (119,657) (89,796) Sub Total (119,657) (89,796) Deferred tax Assets Unabsorbed Depreciation & brought forward 171,304 206,056 losses as per Income Tax Unamortized preoperative & preliminary Exp. 5,712 9,091 Sub Total 177,016 215,147 Net Deferred Tax Assets 57,359 125,351

Movement in deferred tax balances during the year 2018 Amount in '000 Particulars Balance as at Recognised in Balance as at March 31, 2017 profit & loss March 31, 2018 Property, plant and equipment (89,796) (29,861) (119,657) Unabsorbed Depreciation & brought forward 206,056 (34,752) 171,304 losses as per Income Tax Unamortized preoperative & preliminary expenses 9,091 (3,380) 5,712 Total 125,351 (67,992) 57,359

23rd Annual Report 2017-18 127 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Movement in deferred tax balances during the year 2017 Amount in '000 Particulars Balance as at Recognised in Balance as at April 1, 2016 profit & loss March 31, 2017 Property, plant and equipment (27,575.37) (62,221) (89,796) Unabsorbed Depreciation & brought forward 27,575.37 178,481 206,056 losses as per Income Tax Unamortized preoperative & preliminary expenses - 9,091 9,091 Total - 125,351 125,351

17. Other Current Liabilities Amount in '000 Particulars As at March 31, As at March 31, 2018 2017 Duties & Taxes 6,303 458 Deferred Fair Valuation Gain - Security Deposits 2,276 503 Income Received in Advance - 671 Other liabilities 56 -

Total 8,636 1,632

18. Revenue From Operations Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Aeronautical Revenue Parking & Housing 495 577 Passenger Service Fee (Facilitation) 17.505 71,803 User Development Fees 454,116 - Extension of Watch Hours 1,818 3,342 Ground Handling Services 8,354 7,801 Throughput Charges 8,146 5,277 Baggage Reconciliation System Charges 446 - Common User Terminal Equipment Charges 18,213 16,098 Cargo Revenue 5,493 5,235 Total 514,586 110,133 Passenger Service Fee (Security) 135,564 121,214

Non-aeronautical Revenue Admission Fees/Commercial Passes 1,655 2,629 Car Parking 45,138 26,663 Rent & Services 117,150 84,738 Trading Concession 109,419 74,823 Total 273,362 188,853

Total 923,512 420,200

128 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

19. Other Income Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Interest on Term Deposits 32,728 23,382 Fair Valuation Gain 6,857 4,756 Miscellaneous Income 225 2,087

Total 39,809 30,225

20. Employee Benefit Expenses Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Pay & Allowances 7,640 7,498 Contribution to Provident Fund and other funds 572 743 Other Staff Cost 79 113 Cost of Staff Deployment of AAI 43,881 34,909 Total 52,173 43,263

21. Operating Expenses Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Repair & Maintenance - Civil 14,424 9,468 - Electrical 24,685 11,226 - Equipment & Furniture 6,127 1,921 - Electronics & IT Infrastructure 170 172 Housekeeping & Cleaning Works 22,197 9,283 Advertisement & Publicity 2,426 6,836 Consumption of Stores & Spares 7,901 5,760 Electricity & Water Charges 53,772 63,508 Lease Rental 696 Rent, Rates & Taxes 705 - Total 133,101 108,175

23rd Annual Report 2017-18 129 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

22. Administrative & Other Expenses Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Postage, Telegram, Telex 64 39 Printing & Stationery 878 928 Telephone Charges 317 400 Travelling Expenses 756 1,189 Consultancy Charges 5,644 3,791 Insurance Expense 251 117 Payment to Auditors - Audit Fee - Statutory Audit 100 101 - Audit Fee - Other Audit 280 65 Training & Seminar Expenses 176 71 Facilitation Expenses 4,945 1,842 Hire Charges - Others 9,706 6,882 Board Meeting Expenses 71 47 Collection Charges on PSF/UDF 5,695 4,196 Other Fees 12 13 Miscellaneous Office Expenses 280 545 Subscription (Professional bodies) 2,044 35 Total 31,219 20,260

23. Security Expenses Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Pay & Allowances and Other Staff Cost 195,970 175,043 Vehicle Running & Hire Charges 3,398 5,740 Other Miscellaneous Expenses 5,522 2,503 Total 204,890 183,285

24. Other Expense Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Interest due to fair valuation 6,857 4,756 Total 6,857 4,756

25. Depreciation Amount in '000 Particulars For the year ended For the year ended March 31, 2018 March 31, 2017 Depreciation 326,442 316,843 Total 326,442 316,843

130 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Notes to accounts for the year ended March 31, 2018 1. Disclosures in respect of Ind AS 107 - Financial Instruments 1.1 Financial Instruments by Categories The carrying value and fair value of financial instruments by categories were as follows: (Amount as of March 31, 2018) Amount in '000

Financial Financial assets/ Amortized assets/liabilities Total carrying Total fair Particulars liabilities cost at fair value value value at FVTPL through OCI Financial Assets: Cash & Cash Equivalents 717,242 717,242 717,242 (Ref Note No. 6) - - Trade Receivable 137,237 - - 137,237 137,237 (Ref Note No. 5) Other Financial Assets 66,557 - - 66,557 66,557 (Ref Note No. 7) Financial Liabilities: Security Deposits 124,246 - - 124,246 124,246

Other Financial Liabilities 66,913 - - 66,913 66,913 (Ref Note No. 15)

(Amount as of March 31, 2017) Amount in '000 Financial Financial assets/ Amortized assets/liabiliti Total carrying Total fair Particulars liabilities cost es at fair value value value at FVTPL through OCI Financial Assets: Cash & Cash Equivalents 374,372 374,372 374,372 (Ref Note No. 6) - - Trade Receivable 42,271 - - 42,271 42,271 (Ref Note No. 5) Other Financial Assets 39,243 - - 39,243 39,243 (Ref Note No. 7) Financial Liabilities: Security Deposits 95,275 - - 95,275 95,275

Other Financial Liabilities 16,885 - - 16,885 16,885 (Ref Note No. 15)

1.2 Fair Value Hierarchy • Level 1 - Level 1 hierarchy includes financial instruments measured using quoted prices (unadjusted) in active markets • Level 2 - Level 2 hierarchy includes financial instruments measured using inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices) • Level 3 - Level 3 hierarchy includes financial instruments measured using inputs that are not based on observable market data (unobservable inputs).

23rd Annual Report 2017-18 131 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

The following table present fair value hierarchy of assets and liabilities measured at fair value (Amount as of March 31, 2018) Valuation Significant Particulars Level 1 Level 2 Level 3 Total Technique and unobservable key inputs inputs Financial liabilities at fair values: Security Deposits 124,246 124,246 Valued at MCLR 8% rate of SBI as on 01/04/2017 124,246 124,246

(Amount as of March 31, 2017)

Valuation Significant Particulars Level 1 Level 2 Level 3 Total Technique and unobservable key inputs inputs Financial liabilities at fair values: Security Deposits 95,275 95,275 Valued at MCLR 9.20% rate of SBI as on 01/04/2017 Total 95,275 95,275

1.3 Financial risk management Financial risk factors The Company's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Company's primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance. a) Market Risk The company does not have any market risk. b) Credit Risk Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables and unbilled revenue. Accordingly, credit risk from trade receivables has been separately evaluated from all other financial assets in the following paragraphs. Trade Receivables & Unbilled Revenue The company has outstanding trade receivables amounting to ` 1372.37 Lakh and ` 422.71 Lakh as of March 31, 2018 and March 31, 2017, respectively and unbilled revenue amounting to ` 369.79 Lakh and ` 6.71 Lakh as of March 31, 2018 and March 31, 2017, respectively. Trade receivables and unbilled revenue are typically secured and are derived from revenue earned from customers. On account of adoption of IND -AS 109, the company uses expected credit loss model to assess the impairment loss or gain.

132 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Credit risk exposure An analysis of age of trade receivables and unbilled receivables at each reporting date is summarized as follows: Amount in '000 31-Mar-18 31-Mar-17 Particulars Gross Gross Impairment Impairment Amount Amount Not past due 34,777 - 10,567 - Past due less than three months 45,696 - 15,572 - Past due more than three months but 24,564 - 4,639 - not more than six months Past due more than six months but 13,212 - 10,238 - not more than one year More than one year 18,988 - 1,255 - Total 137,237 - 42,271 - Trade receivables are impaired when recoverability is considered doubtful based on the recovery analysis performed by the company for individual trade receivables. The company considers that all the above financial assets that are not impaired and past due for each reporting dates under review are of good credit quality.The company does not hold any collateral or other enhancements to cover its credit risks associated with its financial assets.

Other financial assets Credit risk relating to cash and cash equivalents is considered negligible because our counterparties are banks. We consider the credit quality of term deposits with such banks that are majority owned by the Government of India and subject to the regulatory oversight of the Reserve Bank of India to be good, and we review these banking relationships on an ongoing basis. There are no impairment provisions as at each reporting date against these financial assets. We consider all the above financial assets as at the reporting dates to be of good credit quality. c) Liquidity Risk Our liquidity needs are monitored on the basis of monthly and yearly projections. The company’s principal sources of liquidity are cash and cash equivalents, cash generated from operations & contribution in the form of share capital. We manage our liquidity needs by continuously monitoring cash inflows and by maintaining adequate cash and cash equivalents. Net cash requirements are compared to available cash in order to determine any shortfalls. Short term liquidity requirements consists mainly of sundry creditors, expense payable, employee dues and retention & deposits arising during the normal course of business as of each reporting date. We maintain a sufficient balance in cash and cash equivalents to meet our short term liquidity requirements. We assess long term liquidity requirements on a periodical basis and manage them through internal accruals. In the financial year 2017-18,CHIAL has not taken any loans from any of the sources. Our non-current liabilities include security deposits only. The table below provides details regarding the contractual maturities of non-derivative financial liabilities. The table have been drawn up based on the undisclosed cash flows of financial liabilities based on the earliest date on which the company can be required to pay. The table includes both principal & interest cash flows.

(Amount as of March 31, 2018) Amount in '000 Less than 6 months More than Particulars 1-3 years 3-5 years Total 6 months to 1 year 5 years Security Deposits 31,180 53,648 25,191 9,708 4,519 124,246 Other Financial Liabilities 66,913 66,913 Total 98,093 53,648 25,191 9,708 4,519 191,159

23rd Annual Report 2017-18 133 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

(Amount as of March 31, 2017) Amount in '000 Less than 6 months More than Particulars 1-3 years 3-5 years Total 6 months to 1 year 5 years Security Deposits 25,922 8,323 54,653 6,004 373 95,275 Other Financial Liabilities 16,885 16,885 Total 42,807 8,323 54,653 6,004 373 112,160

2. Disclosure in respect of Indian Accounting Standard (Ind AS)-36 “Impairment of assets” During the year, the company assessed the impairment loss of assets and is of the opinion that assets have been recently capitalized pursuant to operation start date. As the project has a long life and no indication exists for the impairment of the assets, therefore, it is considered that during the year, there is no impairment loss of assets. 3. Disclosure in respect of Indian Accounting standard (Ind AS)-108: "Operating Segments" Based on the “management approach” as defined in Ind AS 108, the Chief Operating Decision Maker (CODM) evaluates the Company’s performance and allocates resources based on an analysis of various performance indicators by business segments. The Company is in the business of operations of the Airport at Chandigarh(Mohali). Consequently, the Company does not have separate business segment. Information about major customers (Refer Para 34 of Ind AS 108) If revenues from transactions with a single external customer amount to 10 per cent or more of an entity’s revenues, the entity shall disclose that fact, the total amount of revenues from each such customer, and the identity of the segment or segments reporting the revenues. The same can be provided in the following format.

Year ended Year ended Particulars March 31, 2018 March 31, 2017

No of customers 2 2 Total Revenue from above customers 381,267 136,612 Total Revenue 923,512 420,200 % of total Revenue 41% 33%

4. Disclosure in respect of Indian Accounting Standard 24 "Related Parties Disclosures" 4.1 Disclosures for Other than Govt. Related Entities a. List of key management personnel

Name Designation Sh. Suneel Dutt Chief Executive Officer

Chief Financial Officer Sh. J.B. Saini till 27.10.2017 Chief Financial Officer Sh. Rakesh Dembla from 24.05.2018

Smt. Avneet Kaur Company Secretary

b. Compensation of key management personnel For the year ended For the year ended Particulars March 31, 2018 March 31, 2017

Short-term benefits 7,719 7,611 Post-employment benefits 572 743 Total 8,291 8,353

134 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

c. Transactions with Related Parties FY 2017-18 Staff Procurement Closing Name of Party Issue of shares Deployment Others of Assets Cost Balance AAI - 6 96 49,5 77 (66,105 ) 1,053 GMADA - - HUDA - -

FY 2017-18 Staff Procurement Closing Name of Party Issue of shares Deployment Others of Assets Balance Cost AAI 4,740,191,950 10,966 34,909 6 ,039 16,885 GMADA 2,277,151,050 - - - HUDA 2,277,151,050 - - -

d. Closing Balance Balance as on Balance as on Name of Party March 31, 2018 March 31, 2017 No of customers 1,053 16,885 - -

5. Disclosure in respect of Indian Accounting standard (Ind AS) 17 "Leases" 5.1 As lessee a) Operating Lease

For the year ended For the year ended Particulars March 31, 2018 March 31, 2017 Lease Rent recognize during the 696 - period in profit and loss

Description: Arrangement to supply X-Ray Baggage Machine to the company and payment will be made in a tenure of 6 years. Lease is a cancellable lease.

5.2 As lessor a) Operating Lease • Future minimum lease payments under non-cancellable operating leases For the year ended Year ended Particulars March 31, 2018 March 31, 2017 Not later than 1 year 50,323 46,159 Later than 1 year and not later Nil Nil than 5 years Later than 5 years Nil Nil

23rd Annual Report 2017-18 135 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

6. Disclosure in respect of Indian Accounting Standard (Ind AS)-33 "Earnings Per Share(EPS)" a) Basic EPS The earnings and weighted average number of ordinary shares used in the calculation of basic EPS and diluted EPS is as follows: For the year ended Year ended Particulars March 31, 2018 March 31, 2017 Profit (loss) for the year, attributable to the 140,648 (100,805) owners of the company Earnings used in calculation of basic 140,648 (100,805) earnings per share(A) Weighted average number of ordinary shares 969,449 823,765 for the purpose of \basic earnings per share(B) Basic EPS(A/B) 0.15 (0.12)

b) Diluted EPS The earnings and weighted average number of ordinary shares used in the calculation of Diluted EPS is as follows:

For the year ended Year ended Particulars March 31, 2018 March 31, 2017

Profit (loss) for the year, attributable to the 140,648 (100,805) owners of the company

Earnings used in calculation of basic 140,648 (100,805) earnings per share(A) Weighted average number of ordinary shares 969,449 965,405 for the purpose of \basic earnings per share(B)

Basic EPS(A/B) 0.15 (0.10)

7. Disclosure in respect of Indian Accounting Standard (Ind AS)-37 “Provisions, Contingent Liabilities and Contingent Assets” Movement in provisions For the year ended Year ended Particulars March 31, 2018 March 31, 2017

Opening balance 32,729 45,613 Addition/Transfer during the year - 32,729

Utilization during the year 32,729 45,613 Closing balance - 32,729

8. For the year ended Year ended Particulars March 31, 2018 March 31, 2017

Value of Components, spare parts & stores:

Addition/Transfer during the year - -

Utilization during the year 612 1456 Closing balance - -

136 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

9. Contingent Liabilities: A Power Purchase agreement dated 12.07.2016 was executed between CHIAL and ReNew Solar Power Private Limited for supply of 100% of the generated power from ReNew's 3MWp Solar Plant at CHIAL.The tariff quoted for the same is ` 4.64 KwH. Renew Solar Power Private Limited has billed CHIAL for the complete amount of power generated whereas CHIAL has acknowledged and paid for only the amount of energy actually consumed and has not recognised the liability for remaining amount invoiced by Renew Solar Power Private Limited. The party has proposed for setting up Dispute Resolution Committee which is under consideration of higher management. 10. Contingent Assets: No contingent assets reported as on balance sheet date. 11. Capital Commitments (a) Capital Commitments: Estimated amount of contracts remaining to be executed on capital account is ` 11,116 Lakh on March 31, 2018. (b) Capital Commitments: Estimated amount of contracts remaining to be executed on capital account is ` 3,626.08 Lakh on March 31, 2017. 12. CHIAL was raising invoices on Air India with the rates it is charging from other airlines. However, Air India was not paying this amount and there was no formal agreement between Air India and CHIAL. As of March 31 2018, no settlement had been arrived and financial impact is ascertained to be 2.95 crores approximately. Therefore, this non- adjusting event will be accounted for in FY 2018-19. 13. Non-cash Transactions: As required by Ind AS 7 For the financial year 2017-18, Chandigarh International Airport hasn't incurred any Non Cash Transaction. 14. Approval of financial statements The unaudited financial statements were approved by the Board of Directors and authorised for issue on 27/06/2018.

For Subhash & Associates Chartered Accountants For and on behalf of the Board of Directors

Sd/- Sd/- Sd/- Sd/- Sd/- (CA Subhash Bansal) (Avneet Kaur) (Rakesh Dembla) (S.Suresh) (Anuj Aggarwal) Proprietor Company Secretary CFO Director Director Membership No. 017035 FRN 000825N Place : Chandigarh Date: 28.08.2018

23rd Annual Report 2017-18 137 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF CHANDIGARH INTERNATIONAL AIRPORT LIMITED

Report on the Ind AS Financial Statements Those Standards require that we comply with ethical We have audited the accompanying standalone Ind AS requirements and plan and perform the audit to obtain financial statements of CHANDIGARH INTERNATIONAL reasonable assurance about whether the standalone Ind AIRPORT LIMITED ('the Company') which comprise the AS financial statements are free from material Balance Sheet as at March 31, 2018, the Statement of Profit misstatement. and Loss (including other comprehensive income),the An audit involves performing procedures to obtain audit statement of Cash Flow and Statement of changes in evidence about the amounts and the disclosures in the Equity for the year ended 31st March, 2018, and a standalone Ind AS financial statements. The procedures summary of significant accounting policies and other selected depend on the auditor's judgment, including the explanatory information (together hereinafter referred to assessment of the risks of material misstatement of the as "Standalone Ind AS Financial Statements"). standalone Ind AS financial statements, whether due to Management's Responsibility for the Comparative fraud or error. In making those risk assessments, the Standalone Ind AS Financial Statements auditor considers internal financial control relevant to the Company's preparation of the standalone Ind AS financial The Company's Board of Directors is responsible for the statements that give a true and fair view in order to design matters stated in Section 134(5) of the Companies Act, audit procedures that are appropriate in the 2013 ("the Act") with respect to the preparation of these circumstances,. An audit also includes evaluating the standalone Ind AS financial statements that give a true appropriateness of the accounting policies used and the and fair view of the financial position, financial reasonableness of the accounting estimates made by the performance including comprehensive income, cash Company's Directors, as well as evaluating the overall flows and changes in equity of the Company in presentation of the standalone Ind AS financial accordance with the accounting principles generally statements. accepted in India, including the Indian Accounting Standards (Ind AS)prescribed under Section 133 of the We believe that the audit evidence we have obtained is Act, read with relevant rules issued there under. sufficient and appropriate to provide a basis for our audit opinion on the Standalone Ind AS financial statements This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of Opinion the Act for safeguarding the assets of the Company and for In our opinion and to the best of our information and preventing and detecting frauds and other irregularities; according to the explanations given to us, the aforesaid selection and application of appropriate accounting Standalone Ind AS financial statements give the policies; making judgments and estimates that are information required by the Act in the manner so required reasonable and prudent; and design, implementation and and give a true and fair view in conformity with the maintenance of adequate internal financial controls, that accounting principles generally accepted in India were operating effectively for ensuring the accuracy and including the Ind AS, of the financial position of the completeness of the accounting records, relevant to the Company as at March 31, 2018, and its profit including preparation and presentation of the standalone Ind AS other comprehensive income, its cash flows and the financial statements that give a true and fair view and are changes in equity for the year ended on that date. free from material misstatement, whether due to fraud or error. Report on Other Legal and Regulatory Requirements Auditor's Responsibility 1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order") issued by the Central Our responsibility is to express an opinion on these Government of India in terms of sub-section (11) of Standalone Ind AS financial statements based on our section 143 of the Act, we give in the "Annexure A" a audit. statement on the matters specified in paragraphs 3 We have taken into account the provisions of the Act, the and 4 of the Order. accounting and auditing standards and matters which are 2. We enclose our report in terms of Section 143(5) of required to be included in the audit report under the the Act, on the basis of such checks of the books and provisions of the Act and the Rules made thereunder. records of the Company as we considered We conducted our audit in accordance with the Standards appropriate and according to the information and on Auditing specified under Section 143(10) of the Act. explanations given to us, in the "Annexure B" on the

138 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

directions and sub directions issued by the CHIAL awarded entire Ground Handling Contract Comptroller and Auditor General of India. to M/s AIATSL as per the AAI (General 3. As required by section 143 (3) of the Act, we report Management Entry for Ground Handling that: Services) Regulations, 2007. The same is challenged by FIA and is pending before the High (a) We have sought and obtained all the information Court of Punjab & Haryana. The High Court and explanations which to the best of our allowed the Writ Petition in favour of the knowledge and belief were necessary for the petitioners i.e. FIA vide order dated 24.09.2015 purpose of our audit; and ordered that Ground Handling functions (b) In our opinion proper books of account as shall be performed by the bonafide whole time required by law have been kept by the Company employees of the airlines and the other ground so far as it appears from our examination of those handling agencies specifically permitted in books; writing by the AAI to undertake Ground Handling (c) The Balance Sheet, the Statement of Profit and activities through their bonafide whole time Loss, the Statement of Cash Flows and the employee. The High Court further ordered Statement of Changes in Equity dealt with by this 'Status Quo' on the order dated 24.09.2015 vide Report are in agreement with the books of its order dated 20.10.2015. There is no financial account; implication on the company due this litigation. (d) In our opinion, the aforesaid standalone Ind AS (2) CWP No. 27436 of 2015 (Mohali Industries financial statements comply with the Indian Association Versus Union of India and Others) Accounting Standards specified under section A CWP was filed by the Mohali Industries 133 of the Act, read with relevant rules issued Association in the High Court of Punjab & thereunder; Haryana, to ensure the operation of the (e) On the basis of written representations received International flights at the Chandigarh from the directors, taken on record by the Board International Airport since in their view the non- of Directors, none of the directors is disqualified operation of the same is causing huge loss to the as on March 31, 2018 from being appointed as a public exchequer and also to passenger services director in terms of Section 164 (2) of the Act; and business and/or industries situated in Punjab, Haryana and Himachal Pradesh. The (f) With respect to the adequacy of the internal litigation is pending in the court; however, there financial controls over financial reporting of the is no financial implication on the company. Company and the operating effectiveness of such controls, refer to our separate Report in ii. The Company did not have any long-term contracts "Annexure C" and including derivative contracts for which there were any material foreseeable losses. (g) With respect to the other matters to be included in the Auditor's Report in accordance with Rule iii. There were no amounts which were required to be 11 of the Companies (Audit and Auditors) Rules, transferred to the Investor Education and Protection 2014, in our opinion and to the best of our Fund by the Company. information and according to the explanations iv. The disclosures regarding details of specified bank given to us: notes held and transacted during 8 November 2016 (i) The Company is having two pending litigations as to 30 December 2016 has not been made since the detailed below:- requirement does not pertain to financial year ended 31 March 2018. (1) CWP No. 18628 of 2015 (The Federation of (FIA) Versus Union of India and Others) For Subhash & Associates Chartered Accountants

Sd/- (CA Subhash Bansal) Proprietor Place : Chandigarh Membership No. 017035 Date: 28.08.2018 FRN 000825N

23rd Annual Report 2017-18 139 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

"ANNEXURE A" TO THE INDEPENDENT AUDITORS' REPORT

The Annexure referred to in Independent Auditors' Report maintained by the Company pursuant to the rules to the members of the Company on the standalone Ind AS prescribed by Central Government for maintenance financial statements for the year ended 31 March 2018, we of Cost Records under Section 148 (1) of the Act and report that: are of the opinion that prima facie, the prescribed i) (a) The Company has maintained proper records accounts and records have been made and showing full particulars, including quantitative maintained. However, we have not made a detailed details and situation of fixed assets; examination of the records. (b) The Fixed Assets have been physically verified by vii) (a) According to information and explanations given the management in a phased manner, designed to us and on the basis of our examination of the to cover all the items over a period of three years, r e c o r d s o f t h e C o m p a n y , a m o u n t s which in our opinion, is reasonable having deducted/accrued in the books of account in respect of undisputed statutory dues including regard to the size of the company and nature of Provident Fund, Employees State Insurance, its business. Pursuant to the programme, a Income-Tax, Sales tax, Service Tax, Duty of certain fixed asset has been physically verified by Customs, Duty of Excise, Value added Tax, Cess the management during the year and no and any other material statutory dues have been material discrepancies between the books regularly deposited during the year by the records and the physical fixed assets have been Company with the appropriate authorities. noticed. According to the information and explanations (c) According to the information and explanation given to us, the Company did not have any given to us and on the basis of our examination of undisputed amounts payable in respect of the the records of the Company, the title deeds of above and there were no arrears as at March 31, immovable properties are held in the name of 2018 for a period of more than six months from the Company. the date on when they become payable. ii) The Company is a Service Company, primarily b) According to the information and explanation rendering Airport Services. Accordingly, it does not given to us, there are no dues of income tax, sales hold any physical inventories. Thus, paragraph 3 (ii) tax, service tax, duty of customs, duty of excise, of the order is not applicable to the Company. value added tax which have not been deposited iii) The Company has not granted any loans, secured or with the appropriate authorities on account of unsecured to Companies, Firms, Limited Liability any dispute. Partnerships or other parties covered in the Register viii) The Company does not have any loans or borrowing maintained under section 189 of the Act. from any financial institution, banks, government or Accordingly, the provisions of clause iii (a) to (c) of debenture holders during the year. Accordingly, the Order are not applicable. paragraph 3 (viii) of the Order is not applicable. iv) In our opinion and according to the information and ix) Based upon the audit procedures performed and the explanations given to us, the company has not information and explanations given by the granted any loan or made any investment as defined management, the company did not raised any money under the provisions of section 185 and 186 of the by way of initial public offer or further public offer Companies Act, 2013. (including debt instruments) and term loans during v) The Company has not accepted any deposits from the the year. Accordingly, the provisions of clause 3 (ix) of public and hence the directives issued by the Reserve the Order are not applicable to the Company and Bank of India and the provisions of Sections 73 to 76 hence not commented upon. or any other relevant provisions of the Act and the x) According to information and explanations given to Companies (Acceptance of Deposit) Rules, 2015 with us by the management, we report that no fraud by regard to the deposits accepted from the public are the Company or on the company by its officers or not applicable. employees has been noticed or reported during the course of our audit. vi) We have broadly reviewed the books of accounts

140 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

xi) Based upon the audit procedures performed and the xiv) According to the information and explanations given information and explanations given by the to us and based on an overall examination of the management, the provisions of section 197 read with Balance Sheet, the Company has not made any Schedule V to the Companies Act are not applicable preferential allotment or private placement of shares to the Company. Therefore, the provisions of clause 3 or fully or partly convertible debentures during the (xi) of the Order are not applicable to the Company. year under review and hence reporting requirements xii) In our opinion and according to the information and under clause 3 (xiv) of the Order are not applicable to the Company and not commented upon. explanations given to us, the Company is not a nidhi company. Therefore, the provisions of clause 3 (xii) of xv) According to the information and explanations given the Order are not applicable. to us and based on our examination of the records, the Company has not entered into any non-cash xiii) In our opinion, all transactions with the related parties transactions with directors or persons connected are in compliance with section 177 and 188 of with him. Accordingly, paragraph 3 (xv) of the Order Companies Act, 2013 and the details have been is not applicable to the Company. disclosed in the standalone Ind AS financial statements as required by the applicable accounting xvi) In our opinion, the company is not required to be standards. registered under section 45-IA of the Reserve Bank of India Act, 1934 and accordingly, the provisions of clause 3 (xvi) of the Order are not applicable.

For Subhash & Associates Chartered Accountants

Sd/- (CA Subhash Bansal) Proprietor Place : Chandigarh Membership No. 017035 Date:28.08.2018 FRN 000825N

23rd Annual Report 2017-18 141 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

"ANNEXURE B" TO THE INDEPENDENT AUDITORS' REPORT

Referred to in paragraph 2 under the heading 'Report on Other Legal & Regulatory Requirement' of our report of even date to the financial statements of the Company for the year ended March 31, 2018:

1. Whether the company has clear title/lease deeds for freehold and Yes, title deed of the land is leasehold respectively? If not please state the area of freehold and freehold as per documents leasehold land for which title/lease deeds are not available. produced to us 2. Please report whether there are any cases of waiver/write off NIL during the year debts/loans/interest etc. If yes, the reasons therefore and the amounts involved. 3. Whether proper records are maintained for inventories lying with NIL during the year third parties & assets received as gift from Govt. or other authorities.

For Subhash & Associates Chartered Accountants

Sd/- Place : Chandigarh (CA Subhash Bansal) Date: 28.08.2018 Proprietor Membership No. 017035 FRN 000825N

142 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

"ANNEXURE C" TO THE INDEPENDENT AUDITORS' REPORT

Report on the Internal Financial Controls under Clause Our audit involves performing procedures to obtain audit (i) of Sub-section 3 of Section 143 of the Companies evidence about the adequacy of the internal financial Act, 2013 ("the Act") controls system over financial reporting and their We have audited the internal financial controls over operating effectiveness. Our audit of internal financial financial reporting of Chandigarh International Airport controls over financial reporting included obtaining an Limited ("the Company") as of March 31, 2018 in understanding of internal financial controls over financial conjunction with our audit of the standalone Ind AS reporting, assessing the risk that a material weakness financial statements of the Company for the year ended exists, and testing and evaluating the design and on that date. operating effectiveness of internal control based on the Management's Responsibility for Internal Financial assessed risk. The procedures selected depend on the auditor's judgement, including the assessment of the risks Controls of material misstatement of the standalone Ind AS The Company's management is responsible for financial statements, whether due to fraud or error. establishing and maintaining internal financial controls We believe that the audit evidence we have obtained is based on the internal control over financial reporting sufficient and appropriate to provide a basis for our audit criteria established by the Company considering the opinion on the Company's internal financial controls essential components of internal control stated in the system over financial reporting. Guidance Note on Audit of Internal Financial Controls over Financial Reporting issued by the Institute of Chartered Meaning of Internal Financial Controls over Financial Accountants of India ('ICAI'). These responsibilities Reporting include the design, implementation and maintenance of A company's internal financial control over financial adequate internal financial controls that were operating reporting is a process designed to provide reasonable effectively for ensuring the orderly and efficient conduct assurance regarding the reliability of financial reporting of its business, including adherence to company's and the preparation of financial statements for external policies, the safeguarding of its assets, the prevention and purposes in accordance with generally accepted detection of frauds and errors, the accuracy and accounting principles. A company's internal financial completeness of the accounting records, and the timely control over financial reporting includes those policies preparation of reliable financial information, as required and procedures that (1) pertain to the maintenance of under the Companies Act, 2013. records that, in reasonable detail, accurately and fairly Auditors' Responsibility reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that Our responsibility is to express an opinion on the transactions are recorded as necessary to permit Company's internal financial controls over financial preparation of financial statements in accordance with reporting based on our audit. We conducted our audit in generally accepted accounting principles, and that accordance with the Guidance Note on Audit of Internal receipts and expenditures of the company are being Financial Controls Over Financial Reporting (the made only in accordance with authorisations of "Guidance Note") and the Standards on Auditing, issued management and directors of the company; and (3) by ICAI and deemed to be prescribed under section provide reasonable assurance regarding prevention or 143(10) of the Companies Act, 2013, to the extent timely detection of unauthorised acquisition, use, or applicable to an audit of internal financial controls, both disposition of the company's assets that could have a applicable to an audit of Internal Financial Controls and, material effect on the financial statements. both issued by the Institute of Chartered Accountants of India. Those Standards and the Guidance Note require Inherent Limitations of Internal Financial Controls that we comply with ethical requirements and plan and over Financial Reporting perform the audit to obtain reasonable assurance about Because of the inherent limitations of internal financial whether adequate internal financial controls over controls over financial reporting, including the possibility financial reporting was established and maintained and if of collusion or improper management override of such controls operated effectively in all material respects. controls, material misstatements due to error or fraud may

23rd Annual Report 2017-18 143 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

occur and not be detected. Also, projections of any an adequate internal financial controls system over evaluation of the internal financial controls over financial financial reporting and such internal financial controls reporting to future periods are subject to the risk that the over financial reporting were operating effectively as at internal financial control over financial reporting may March 31, 2018, based on the internal control over become inadequate because of changes in conditions, or financial reporting criteria established by the company that the degree of compliance with the policies or considering the essential components of internal control procedures may deteriorate. stated in the Guidance Note on Audit of Internal financial Opinion Controls Over Financial Reporting issued by the Institute In our opinion, the Company has, in all material respects, of Chartered Accountants of India.

For Subhash & Associates Chartered Accountants

Sd/- (CA Subhash Bansal) Place : Chandigarh Proprietor Date: 28.08.2018 Membership No. 017035 FRN 000825N

144 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

SUBHASH & ASSOCIATES CHARTERED ACCOUNTANTS KOTHI NO. 45, SECTOR 19-A, CHANDIGARH TELEPHONE NO.0172-2775980, 4631945 (FAX) Email: [email protected]

COMPLIANCE CERTIFICATE

We have conducted the audit of accounts of Chandigarh International Airport Limited for the year ended 31.03.2018 in accordance with the directions/sub-directions issued by the C & AG of India under Section 143 (5) & (6) of the Companies Act, 2013 and certify that we have complied with all the directions/sub-directions issued to us.

FOR SUBHASH & ASSOCIATES CHARTERED ACCOUNTANTS

Sd/- (CA Subhash Bansal) Place : Chandigarh Proprietor Membership No. 017035 Date: 28.08.2018 FRN 000825N

23rd Annual Report 2017-18 145 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

146 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

23rd Annual Report 2017-18 147 148 23rd Annual Report 2017-18 FINANCIAL STATEMENTS OF AAI CARGO LOGISTICS AND ALLIED SERVICES COMPANY LIMITED

23rd Annual Report 2017-18 149 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

BALANCE SHEET AS AT 31 MARCH, 2018

Note As at As at No. 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) A EQUITY AND LIABILITIES 1. SHAREHOLDERS' FUNDS a. Share capital 3 250,000,000 250,000,000 b. Reserves and surplus 4 1,521,741,454 (2,304,024) 1,771,741,454 247,695,976 2. NON-CURRENT LIABILITIES a. Other long-term liabilities 5 5,270,512 - b. Deffered tax liabilities 6 8,446,343 - 13,716,855 - 3. CURRENT LIABILITIES a. Trade payables 7 14,919,175 - b. Other current liabilities 8 985,486,865 4,255,069 c. Short-term Provisions 9 287,610,041 - 1,288,016,081 4,255,069

3,073,474,390 251,951,045 B ASSETS 1. NON-CURRENT ASSETS a. Fixed assets - Tangible assets 10 1,169,945,012 - - Intangible assets 10 8,584,079 - b. Deffered tax asset 11 - 634,203 1,178,529,091 634,203 2. CURRENT ASSETS a.Trade receivables 12 104,438,564 - b.Cash and Bank balance 13 1,703,416,601 251,110,095 c.Short-term loans and advances 14 437,778 - d.Other current assets 15 86,652,356 206,747 1,894,945,299 251,316,842

See accompanying notes forming part 3,073,474,390 251,951,045 of the financial statements 1-36

In terms of our Audit Report Attached For & on behalf of Board of Directors sd/- sd/- for P.R.KUMAR & CO. (APIL AGARWAL) (R.K. DAS) Chartered Accountants Company Secretary Chief Financial Officer Firm Reg. No.: 003186N PAN: AMPPA1914L PAN: AGFPD8467K sd/- sd/- sd/- (RAHUL KATHURIA) (S. SURESH) (KEKU BOMI GAZDER) Partner Director Chief Executive Officer M. No.: 090657 DIN: 06386248 PAN: ARCPK6948G sd/- (DR. GURUPRASAD MOHAPATRA) Place: New Delhi Chairman Date : 11th September 2018 DIN:00012570

150 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31 MARCH, 2018

Note Year ended Year ended No. 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees)

1. Revenue from operations 16 3,433,298,187 2. Other income 17 38,454,294 1,317,475 3. TOTAL REVENUE (1+2) 3,471,752,481 1,317,475

4. EXPENSES a. Employee benefits expense 18 369,536,721 1,044,577 b. Operative expenses 19 540,655,093 - c. Depreciation and amortisation expense 20 160,732,959 - d. Administrative and other expenses 21 60,877,433 3,211,125 TOTAL EXPENSES 1,131,802,206 4,255,702 5. PROFIT/(LOSS) BEFORE TAX (3-4) 2,339,950,275 (29,38,227)

6. TAX EXPENSE 806,824,251 - a. Current tax b. Deferred tax charge/(credit) 6 9,080,546 (634,203) NET TAX EXPENSE 815,904,797 (634,203) 7. PROFIT/(LOSS) FOR THE YEAR (5-6) 1,524,045,478 (2,304,024) 8. EARNINGS/(LOSS) PER SHARE (Equity shares of Rupees 10 each) a. Basic 23 60.96 (0.09) b. Diluted 23 60.96 (0.09)

See accompanying notes forming part of the 1 - 36 financial statements

In terms of our Audit Report Attached For & on behalf of Board of Directors sd/- sd/- for P.R.KUMAR & CO. (APIL AGARWAL) (R.K. DAS) Chartered Accountants Company Secretary Chief Financial Officer Firm Reg. No.: 003186N PAN: AMPPA1914L PAN: AGFPD8467K sd/- sd/- sd/- (RAHUL KATHURIA) (S. SURESH) (KEKU BOMI GAZDER) Partner Director Chief Executive Officer M. No.: 090657 DIN: 06386248 PAN: ARCPK6948G sd/- (DR. GURUPRASAD MOHAPATRA) Place: New Delhi Chairman Date : 11th September 2018 DIN:00012570

23rd Annual Report 2017-18 151 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 MARCH, 2018 Note Year ended Year ended No. 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) A. CASH FLOW FROM OPERATING ACTIVITIES Net Profit / (Loss) before tax 2,339,950,275 (2,938,227) Adjustments for : Depreciation and amortisation expense 160,732,959 - Interest income on current investments (33,447,202) (1,307,475) Operating profit/(loss) before working capital changes 2,467,236,032 (4,245,702) Adjustments for movement in operating assets: Decrease/(Increase) in Trade receivables (104,438,564) - Decrease/(Increase) in Short term loans & advances (437,778) - Increase/(Decrease) in Other current Assets (86,445,609) (206,747) Adjustments for movement in operating Liability: Increase/(Decrease) in Long term Libilities 5,270,512 - Increase/(Decrease) in Trade payable 14,919,175 - Increase/(Decrease) in Other current liabilities 981,231,796 4,255,069 Cash generated from / (used in) operations 3,277,335,564 (197,380) Net income tax (paid) / refunds (519,214,209) Net cash from/ (used in) operating activities (A) 2,758,121,354 (197,380)

B. CASH FLOW FROM INVESTING ACTIVITIES Capital expenditure on fixed assets, including (1,339,262,050) - capital advances Interest income on current investments 33,447,202 1,307,475 Bank balances not considered as cash and cash (1,099,719,361) (250,675,852) equivalents-Placed Net cash from/ (used in) investing activities (B) (2,405,534,209) (249,368,377)

C. CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issue of share capital (Inlcuding securities - 250,000,000 premium) Net cash from/ (used in) financing activities (C) - 250,000,000 Net increase/ (decrease) in cash and cash equivalents 352,587,145 434,243 Cash and cash equivalents as at the beginning of the year 13 434,243 - Cash and cash equivalents as at the end of the year 13 353,021,388 434,243 See accompanying notes forming part of the 1-36 financial statements In terms of our Audit Report Attached For & on behalf of Board of Directors sd/- sd/- for P.R.KUMAR & CO. (APIL AGARWAL) (R.K. DAS) Chartered Accountants Company Secretary Chief Financial Officer Firm Reg. No.: 003186N PAN: AMPPA1914L PAN: AGFPD8467K sd/- sd/- sd/- (RAHUL KATHURIA) (S. SURESH) (KEKU BOMI GAZDER) Partner Director Chief Executive Officer M. No.: 090657 DIN: 06386248 PAN: ARCPK6948G sd/- (DR. GURUPRASAD MOHAPATRA) Place: New Delhi Chairman Date : 11th September 2018 DIN:00012570

152 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2018

1. Corporate Information liabilities as at the date of the financial statements. AAI Cargo Logistics & Allied Services Company Management believes that these estimates and Limited ('the Company') was incorporated on 11 assumptions are reasonable and made on prudent August, 2016 under the Companies Act, 2013. The basis taking into account all available information, Company is primarily engaged in the business of however the actual results could differ from these Cargo logistics and allied services. estimates and such differences are recognized in the period in which the results are crystallized. The cargo business was earlier a business division of Airports Authority of India (Parent Company). The b. Fixed Assets entire business activity related to this division has i) Tangible Assets been transferred by the parent company to the -Fixed assets are stated at cost, net of credit availed in company w.e.f. 01.04.2017. respect of any taxes, duties, capital grant receipts less 2. SIGNIFICANT ACCOUNTING POLICIES accumulated depreciation and impairment losses. a. Basis of Accounting Cost comprises the purchase price and any attributable cost of bringing the asset to its working i) The financial statements have been prepared in condition for intended use. accordance with Generally Accepted Accounting Principles in India (GAAP) to comply with the -Part completion of works / projects and put to use Accounting Standards specified under section 133 of are capitalized based on the technical assessment. the Companies Act, 2013 read with Rule 7 of the ii) Intangible Assets Companies (Accounts) Rules 2014 and the relevant Computer Software (not being an embedded provisions of Companies Act 2013. The financial software in the equipment) which is put to use and is statements have been prepared under the historical expected to provide future enduring economic cost convention on an accrual basis. The accounting benefits is recognized as Intangible Assets and policies have been consistently applied by the amortized on straight line basis as per accounting Company. standard -26 “Intangible assets” or license period of All assets and liabilities have been classified as current the software whichever is earlier. However where or non-current as per the Company’s normal such computer software is still in development stage, operating cycle and other criteria set out in the costs incurred during the development stage of such Schedule III to the Companies Act, 2013. Based on the software are accounted as “Intangible Assets Under nature of services and the time between the Development “and expenditure on Research & acquisition of assets for processing and their Development, other than on capital account, is realization in cash and cash equivalents, the charged to revenue. Company has ascertained its operating cycle as 12 iii) Impairment of Assets months for the purpose of Current – Non Current As at each balance sheet date, the carrying amount of classification of Assets and Liabilities. cash generating units/assets is tested for impairment ii) Going Concern Assumption so as to determine: The financial statements have been prepared on the The provision for impairment loss, if any required; or assumption of Going Concern basis, accordingly all The reversal, if any, required of impairment loss the assets and liabilities have been reflected at their recognized in previous periods. Impairment loss is book value. recognized when the carrying amount of an asset iii) Use of Estimates exceeds recoverable amount. The preparation of financial statements requires the c. Depreciation and Amortisation management to make estimates and assumptions Depreciation on fixed assets has been provided on that affect the reported amount of assets, liabilities, the straight-line method as per the useful life revenue, expenses and disclosure of contingent prescribed in Schedule II to the Companies Act, 2013.

23rd Annual Report 2017-18 153 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2018

Class of Assets Useful Life g. Foreign Currency Translation Tangible Assets As per Schedule II of the i) Transactions in foreign currency are recorded at the Companies Act, 2013 exchange rates prevailing at the date of transactions. Intangible Assets -Softwares 3 Years ii) Non-Monetary items denominated in foreign d. Investments currency (such as Fixed Assets etc) are valued at the exchange rate prevailing on the date of transaction. Investments that are readily realisable and intended iii) Monetary Items denominated in foreign currencies to be held for not more than a year are classified as (such as Loans, Cash, Bank balances etc) outstanding current investments. All other investments are at the end of reporting period, are translated at classified as long term investments. Current exchange rates prevailing as at the end of reporting investments are carried at lower of cost and fair value date. determined on an individual investment basis. Long- term investments are carried at cost. However, iv) Any gains or losses arising due to differences in provision for diminution in value is made to recognise exchange rates at the time of translation are a decline other than temporary in the value of the accounted for in the statement of P&L either under investments. the head foreign exchange fluctuation or interest cost as per the case. e. Revenue Recognition h. Taxes on Income Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company i) Tax expense comprises both current and deferred tax. and the revenue can be reliably measured. Current tax is measured at the amount expected to be paid to the tax authorities, using the applicable tax i) Income from Operation rates and tax laws. -Revenue is recognized as the services are rendered ii) Deferred tax assets and liabilities are recognized for on accrual basis and is net of Goods and Services Tax. future tax consequences attributable to the timing -Bills are raised at the time when and to the extent differences between taxable income and accounting there is no significant uncertainty as to its income that are capable of reversal in one or more measurability and ultimate realization. -In respect of subsequent period and are measured using tax rates cases under legal disputes /Interest on delayed enacted or substantively enacted as at the Balance payments from customers, Cargo Demurrage Sheet date. charges (except where bills are raised on Deferred Tax assets are not recognized unless, in the Airlines/Agencies), Insurance Claims, Interest on Staff management judgment, there is virtual certainty that advances, etc. are accounted on receipt basis. sufficient future taxable income will be available ii) Interest Income against which such deferred tax assets can be realized. Revenue is recognised on a time proportion basis The carrying amount of deferred tax is reviewed at each taking into account the amount outstanding and the balance sheet date. rate applicable. i. Additional Demand of Taxes f. Stores/Spares Payment of additional demand of, Goods and Stores/spares which are charged to the Statement of Services Tax, Income Tax and any other taxes are Profit and Loss as and when they are procured. The accounted for on payment basis. Similarly refund of above costs of purchase consist of the purchase price were accounted for “As and when received” basis. including duties and taxes (other than those subsequently recoverable by the company from the j. Provisions, Contingent Liabilities and Contingent taxing authorities), freight inwards and other Assets expenditure directly attributable to the acquisition. Provisions are recognized for liabilities that can be Trade discounts, rebates, duty drawbacks and other measured only by using a substantial degree of similar items are deducted in determining the costs of estimation, if : purchase.

154 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS i) The company has a present obligation as a result of a past event, ii) A probably outflow of resources is expected to settle the obligation and, iii) The amount of the obligation can be reliably estimated. Contingent liabilities are disclosed in the case of : i ) A present obligation arising from a past event, when it is not probable that an outflow of resources will be required to settle the obligation. ii) A possible obligation, unless the probability of outflow of resources is remote. Contingent assets are neither recognized nor disclosed. Provisions, contingent liabilities and contingent assets are reviewed at each balance sheet date. k. Earnings per share The basic and diluted earnings per share are computed by dividing the net profit/loss after tax, attributable to equity shareholders for the year by the weighted average number of equity shares outstanding during the year. l. Cash Flow Cash flows are reported using the indirect method, whereby net profits before tax is adjusted for the e f f e c t s o f transactions of a non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from regular revenue generating, investing and financing activities of the Company are segregated. m. Prior Period and Extraordinary Items Income and expenditure pertaining to prior period as well as extraordinary items, where material, are d i s c l o s e d separately. n. Cash and Cash Equivalents Cash and cash equivalents included cash on hand, Cheques on Hand, terms deposits with banks.

As at As at 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees)

3. SHARE CAPITAL Authorised 22,50,00,000 (Previous year 2,50,00,000) Equity Shares of Rupees 10 each(Authorised Capital has been increased 2,25,00,00,000 25,00,00,000 w.e.f. 28th December 2017) 2,25,00,00,000 25,00,00,000

Issued, Subscribed and Paid up:

2,50,00,000 (Previous year 2,50,00,000) Equity Shares of 25,00,00,000 25,00,00,000 Rupees 10 each (Refer notes (i) to (iii) below) 25,00,00,000 25,00,00,000

23rd Annual Report 2017-18 155 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

Notes :- (i) Reconciliation of the number of shares and amount outstanding at the beginning and at the end of the reporting year:

Year ended 31 March, 2018 Year ended 31 March, 2017 Particulars (Number) (Rupees) (Number) (Rupees)

Equity Shares Outstanding at the beginning of 2,50,00,000 25,00,00,000 - - the year Issued during the year - - 2,50,00,000 25,00,00,000 (Also see note ii below)

Outstanding at the end of the year 2,50,00,000 25,00,00,000 2,50,00,000 25,00,00,000

Total 2,50,00,000 25,00,00,000 2,50,00,000 25,00,00,000

(ii) Rights, preferences and restrictions attached to each class of shares Equity Shares The Company has one class of equity shares having a par value of Rupees 10 per share. Each holder of equity share is entitled to one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

(iii) Details of shares held by each shareholder holding more than 5% shares :

As at 31 March, 2018 As at 31 March, 2017 Particulars (Number) (% of holding (Number) (% of holding in that class in that class of shares) of shares)

Equity Shares 24,999,993 99.99% 24,999,993 99.99% Airports Authority of India

156 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

As at As at 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) 4. RESERVES AND SURPLUS a. Surplus in Statement of Profit and loss (2,304,024) - Balance as at beginning of the year 1,524,045,478 (2,304,024) Add: Profit/(Loss) for the current year 1,521,741,454 (2,304,024) Closing balance 1,521,741,454 (2,304,024)

5. OTHER LONG-TERM LIABILITIES a. Security Deposit 5,270,512 - 5,270,512 - 6. DEFERRED TAX LIABILIITIES(NET) Deferred Tax Assets Related to Preliminary Expenses 547,103 -

Deferred Tax Liability Related to Preliminary Expenses 8,993,446 - 8,446,343 - 7. TRADE PAYABLES For Goods and Services a. Total outstanding dues of micro enterprises and - - small enterprises (refer note given below) b. Total outstanding dues of creditors other than micro 14,919,175 enterprises and small enterprises 14,919,175 -

Dues to Micro and Small enterprises as defined in section 7(1) of the Micro, Small and Medium Enterprises Development Act, 2006, to the extent such parties have been identified from the available information. This has been relied upon by auditors.(Refer Note 26)

8. OTHER CURRENT LIABILITIES a. Advance from Customers 45,104,311 - b. Payable for Expenses 463,615 4,255,069 c. Other payables I. Trade Payable for Fixed Assets Total outstanding dues of micro enterprises and small - - enterprises (refer note given below) Total outstanding dues of creditors other than micro 867,647,495 - enterprises and small enterprises

ii. Statutory Liabilities 72,271,444 - 985,486,865 4,255,069 9. SHORT-TERM PROVISIONS a. Provision for Income Tax (Net of Advance Tax) 287,610,041 - 287,610,041 -

23rd Annual Report 2017-18 157 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA )

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158 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS As at As at 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) 11. DEFERRED TAX ASSET(NET) Deferred Tax Assets Related to Preliminary Expenses - 634,203 - 634,203 12. TRADE RECEIVABLES (Unsecured) a. Trade receivables outstanding for a period exceeding six months from the date they were due for payment - considered good 2,312,326 - - considered doubtful - 2,312,326 - Less : Provision for doubtful receivables 2,312,326 - b. Others - considered goods 102,126,238 - 104,438,564 - 13. Cash and Bank balance - Cash and Cash equivalants 132,195 - b. Balances with banks - In Current Accounts 202,889,193 434,243 -Term Deposits (Less than 3 Months) 150,000,000 - 353,021,388 434,243

Other Bank Balance a. Term Deposits (More than 3 Months and less than 12 month) 1,350,395,213 250,675,852 1,350,395,213 250,675,852

1,703,416,601 251,110,095 14. SHORT TERM LOANS AND ADVANCES (Unsecured) a. Prepaid expenses 338,147 - b. Other Recoverable 99,631 - 437,778 -

15. OTHER CURRENT ASSETS a. Accrued Interest on Term Deposit 13,249,327 75,998 b. Unbilled Revenue 73,403,029 - c. Advance Tax - 130,749 86,652,356 206,747

23rd Annual Report 2017-18 159 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

Year ended Year ended 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) 16. REVENUE FROM OPERATIONS

A. Sale of Services a. Revenue from Cargo Services 3,395,454,211 - 3,395,454,211 -

B.Other Operative Revenue a. Other Misc. Operative Income 37,843,976 - 37,843,976 - 3,433,298,187 - 17. OTHER INCOME a. Interest income 33,447,202 1,307,475 b. Miscellaneous Non Operative Income 5,007,092 10,000 38,454,294 1,317,475

18. EMPLOYEE BENEFITS EXPENSE a. Salaries and wages 369,536,721 1,044,577 369,536,721 1,044,577

19. OPERATING EXPENSES a. Collection charges 32,641,191 - b. Watch & Ward expenses 199,662,527 - c. Insurance 616,296 - d. Municipal Tax 1,986,433 - e. Advertisement & publicity 1,871,516 - f. Repairs & Maintenance of Civil works 37,218,361 - g. Repairs & Maintenance of Plant and machinery 19,979,224 - h. Other Repairs & Maintenance 122,336,712 - i. Incentive-Cargo 7,646,686 - j. Consumption of stores 520,234 - k. Electricity & Water charges 98,766,224 - l. Upkeep expenses 17,409,689 - 540,655,093 -

20. DEPRECIATION AND AMORTISATION EXPENESE Depreciation and amortisation expense -Tangible Asset 159,749,355 - -Intangible Asset 983,604 -

160,732,959 -

160 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

Year ended Year ended 31 March, 2018 31 March, 2017 (in Rupees) (in Rupees) 21. ADMINISTRATIVE AND OTHER EXPENSES

a. Rent, Rates, & Taxes 18,147,696 - b. Hire charges 18,913,428 358,441 c. Training expenses 953,174 - d. Legal and professional 7,505,314 126,000 e. Payment To Auditor 300,000 - f. Printing & stationary charges 2,840,713 - g. Travelling expenses 9,413,088 61,593 h. Telephone, fax & internet charges 332,031 1,000 i. Miscellaneous expenses 2,194,836 29,481 j. Preliminary expenses - 2,634,610 k. Interest on GST 277,153 - 60,877,433 3,211,125

Note :

(i) Payment to Auditor Statutory Audit Fees 250,000 25,000 Tax Audit Fees 50,000 - 300,000 25,000

22 EARNINGS PER SHARES (EPS) 31.03.2018 31.03.2017 (in Rupees) (in Rupees) Profit after Tax for the Year 1,524,045,478 (2,304,024) Profit attributable to the Equity Share for the year 1,524,045,478 (2,304,024) Weighted Average No. of Shares outstanding 25,000,000 25,000,000 during the year Basic Earnings per Share 60.96 (0.09) Diluted Earnings per Share 60.96 (0.09) Nominal Value per Equity Share 10.00 10.00

23 RELATED PARTY DISCLOSURES As per Accounting Standard 18 - Related Parties, as notified under the Companies (Accounting Standards) Rule, 2006, the disclosure of transactions with the related parties as defined in accounting standard are given below:- a) Enterprises that directly, or indirectly through one or more intermediaries, control, or are controlled by, or are under common control with, the reporting enterprise Airports Authority of India(AAI) Holding Company

b) Key Management Personnel 1. Dr. Guruprasad Mohapatra Chairman 2. Mr. Keku Bomi Gazder Chief Executive Officer 3. Mr. Sudhir Raheja Director 4. Mr. Suresh Seshadri Director 5. Mr. Bhawani Singh(Only upto 31.03.2018) Chief Financial Officer 6. Mr. Ranjit Kumar Das (From 17.05.2018) Chief Financial Officer 7. Mr. Apil Agarwal Company Secretary

23rd Annual Report 2017-18 161 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

AAI CARGO LOGISTICS & ALLIED SERVICES COMPANY LIMITED

NOTES FORMING PART OF THE FINANCIAL STATEMENTS

c) Related Party Transactions: Class of Related Parties Total Nature of Transaction Enterprise(AAI) Key Managerial Personnel 31.03.2018 31.03.2017 31.03.2018 31.03.2017 31.03.2018 31.03.2017 (In Rupees) (In Rupees) (In Rupees) (In Rupees) (In Rupees) (In Rupees) Remuneration to Key - - 6,517,746 1,044,577 6,517,746 10,44,577 Managerial Personnel Transfer of Revenue 1,391,102,028 - - - 1,391,102,028 - Transfer of Expenses 921,920,847 - - - 921,920,847 - Transfer of Fixed Asset 1,322,633,760 - - - 1,322,633,760 - Net Payable 86,747,495 - - - 86,747,495 -

24 Segment Reporting As the company's business activity falls within a single primary business, however, the company has identified the geographical segment on the basis of revenue such as North, South, East & West and the company has disclosed the Segment Reporting as per the prescribed guidelines under the Accounting Standard -17 " Segment Reporting " :

Particulars East West North South Unallocated Total Segment Revenue 840,035,247 207,245,213 39,660,835 2,351,363,984 - 3,438,305,279 Segment Result Segment Result(Profit/loss) 514,104,981 202,849,920 (56,624,983) 1,646,173,155 - 2,306,503,073 Operating Profit 514,104,981 202,849,920 (56,624,983) 1,646,173,155 - 2,306,503,073 Interest Expenses - - - - - Interest Income - - 31,250,902 2,196,300 - 33,447,202 Profit before Tax 514,104,981 202,849,920 (25,374,080) 1,648,369,454 - 2,339,950,275 Income Tax - - - - 815,904,797 815,904,797 Profit After Tax 514,104,981 202,849,920 (25,374,080) 1,648,369,454 (815,904,797) 1,524,045,478 Other Information Segment Assets 571,514,859 70,877,253 1,380,302,551 1,037,196,310 13,583,417 3,073,474,390 Segment Liabilities - - - - 1,301,732,937 1,301,732,937 Capital Expenditure 216,549,647 5,934,789 37,700,054 1,079,077,560 - 1,339,262,050 Non Cash Expenditure Depreciation, Amortisation 48,324,307 353,877 2,157,745 109,897,030 - 160,732,959 & Impairment Note : Being the first year of operation, there is no business activity in the previous financial year, therefore previous year figures has not been given.

25 Contingent Liabilities And Commitments

a. Pending litigation Financial Impact (Amount in `) Recovery of Custom Duty in the matters of 1,87,09,136 M/s Omega Enterprises vs UOI & Others

b. There are no capital commitments in relation to unexecuted contracts as on March 31, 2018

162 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

26 Operating lease The Company has provided office spaces on operating lease. The future minimum lease expense in respect of period of lease of the premises, including the optional period of lease is as follows :

Lease rental Lease rental Lease rental Stations (0-1 yr) (1-5 yr) (more than 5yr) Chennai 57,810,143 385,781,360 101,768,151 Kolkata 82,509,131 132,881,780 636,608,273 Other Stations 119,718,624 803,983,590 884,381,949 Total 260,037,897 1,322,646,730 1,622,758,373

27 Employee Benefits as per Accounting Standard -15 "All the employees of the company are on stand by deputation from the parent company except the CEO of the company. All the retiral (such as gratuity and leave encashment benefits) including the statutory dues related to employees are borne by and recorded by the parent company in its books of accounts. Further, the company does not hold any obligation towards retiral (including gratuity and leave encashment benefits) of the CEO as per the terms of engagement. Consequently, the applicability of Accounting Standard 15 - "" Employees Benefits "" does not arise."

28 Physical Verification of Fixed Assets "The company has conducted independent third party physical verification of fixed assets for its Kolkata & Chennai station. Physical verification report has been submitted on 09.04.2018 for Kolkata station and 13.04.2018 for Chennai station. Fixed assets having current book value worth ` 4,98,11,938/- were physically not found. Management of the company is not in agreement with the views expressed and submitted their dissent over short / excess found during the physical verification. Pending reconciliation with the physical verification report, no corresponding entries have been passed in the books of accounts as on 31.03.2018." 29 Impairment Testing Impairment testing has not been conducted, considering the first year of operations of the company. 30 Security Deposits Security Deposits in relation to customers/ Operations and Management contracts (O&M contracts) related to cargo business have been received/accounted for by the parent company and the parent company has retained the security deposits amounting to ` 10,61,82,925/- in its financial statements as on March 31, 2018. 31 Insurance of Assets Expenses relating to insurance of assets have not been recorded in the books of accounts of the company since, comprehensive insurance policy covering the assets of the parent company along with the company's assets have been undertaken by the parent company. The corresponding expenses have been retained and recorded in the books of accounts of the parent company. 32 Transactions with parent company The cargo business was earlier a business division of Airports Authority of India (Parent Company). The entire business activity related to this division has been transferred by the parent company to the company w.e.f. 01.04.2017. a. Transfer of business operations & billing The company started billing the customers during the year for various stations commencing from August 17 onwards. The details of commencement of billing for various stations is as below:

Name of Stations Month Chennai, Coimbatore, Madurai, Trichy, Kolkata, Raipur, Aurangabad, Goa, Port Blair, Ranchi Aug-17 Lucknow, Amritsar, Jaipur, Bhubaneswar, Pune, Guwahati, Indore, Srinagar Sep-17 Varanasi, Ahmedabad Oct-17 Bagdogra, Trivandrum Nov-17 Vizag, Mangalore Feb-18

23rd Annual Report 2017-18 163 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

"Stations for which billing has been generated by the parent company for the complete year and subsequently transferred to the company:Jabalpur, Rajkot, Surat, Gaya, Patna, Kanpur, Pant Nagar, Udaipur, Jaisalmer, Jammu, Calicut, Kangra(Gaggal), Vijayawada, Agartala, Imphal, Jorhat, Dibrugarh, Silchar" b. Transfer of Revenue & Expenses "The company has started billing under its GSTN/PAN w.e.f. 01/08/2017. The parent company, i.e., AAI, has transferred all the revenue till 31/07/2017 and in other cases wherever AAI continues to raise bill for cargo operations even after 31/07/2017, the revenue portion has been transferred by AAI to the company. The parent company has also transferred the expenditure for the financial year 2017-18 to the company through the accounting entry as on 31/03/2018. Fixed assets pertaining to the cargo division have also been transferred by the parent company vide decision made at its board meeting dated June 20, 2018 which have been recorded against the money consideration.The amount payable to the parent company against the above transactions have been shown as Capital Creditors in the books of the company. The details of revenue, expenses and fixed assets transferred is as below:" (Amount in `) As approved To be approved by the Board by the Board Total Particulars of the Parent of the Parent Company # Company *# Cargo Revenue 1,390,712,904 389,124 1,391,102,028 Cargo Expenditure (914,317,214) (32,410,640) (946,727,854) Cargo Expenditure being returned by AAICLAS to AAI - 24,807,008 24,807,008 Amount received by AAI on Behalf of AAICLAS 216,122,684 - 216,122,684 Amount paid by AAI on Behalf of AAICLAS as Advance Tax (230,000,000) - (230,000,000) Amount received by AAICLAS on Behalf of AAI - (317,601) (317,601) Net recoverable from AAI As on 31.03.2018 462,518,374 (7,532,109) 454,986,265 * The parent company has confirmed that such revenue and expenses pertains to the company, however, such income and expenses have been retained in their books of accounts as on March 31, 2018 and on the basis of the confirmation to the comapny, the company has accounted for the revenue and expenses related to cargo segment in the current financial year ended on March 31, 2018. # The compliances in relation to statutory dues in respect of such transferred revenue and expenses have been complied with by the parent company as per the requirements of the respective laws. c. Transfer of Fixed Assets Similarly, Cargo Segment Assets, being on Written Down Value as on 01.04.2017 as per Books of Accounts of the parent company (i.e. AAI ), has been transferred to the Company through Accounting entries in due course. The details in this regards are as under:

Particulars Amount in ` Transfer of Fixed Assets as per the Board Resolution dated June 20, 2018 1,037,168,209 and corresponding further ratifications in this regard Transfer of Fixed Assets as per the certification from the parent company 285,465,551 Total Net Block 1,322,633,760

The Fixed Assets, which have been transferred to the company by its parent company initially in exchange of shares of the company, however, as per the cerification from the parent company, it has been confirmed that such fixed assets would be transferred through the money consideration and accordingly the Board of the Parent Company would ratify this proposal and accordingly the effects, considered as Trade Payables - Capital, have been taken in the books of accounts of the company.

164 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

d. Total balance of AAI in books of AAICLAS Company Limited

Particulars Amount in ` Payble for Net Block of cargo segment Tranferred from AAI (as per para 'c' above) 1,322,633,760 Net recoverable from AAI for Tranfer of Revenue and Cost 454,986,265 As on 31.03.2018 (as per para 'b' above) Net Payable to AAI (Classified as Trade Payable Creditors) 867,647,495

33 Trade Receivables and Trade Payables All the balances realted to Trade receivables and Advances from Customers as well as Trade payables including capital creditors are under reconciliation and subject to confirmation from respective parties. 34 Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006 The Ministry of Micro, Small and Medium Enterprises has issued an Office Memorandum dated 26 August 2008 which recommends that the Micro and Small Enterprises should mention in their correspondence with its customers the Entrepreneurs Memorandum Number as allocated after filing of the Memorandum. Accordingly, the disclosure in respect of the amounts payable to such enterprises as at 31 March 2018 has been made in the financial statements based on information received and available with the Company. Based on the information currently available with the Company, there are no dues payable to Micro and Small 'Suppliers' as defined in the Micro, Small and Medium Enterprises Development Act, 2006.

35 Expenditure in Foreign Currency 31.03.2018 31.03.2017 (in Rupees) (in Rupees) Expenditure in Foreign Currency 214,340 -

36 Previous Year Figures Figures of the previous year have been reworked, regrouped, rearranged and reclassified wherever necessary, to make them comparable with the current year figures.

23rd Annual Report 2017-18 165 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

INDEPENDENT AUDITOR'S REPORT TO THE MEMBERS OF AAI CARGO LOGISTICS AND ALLIED SERVICES COMPANY LIMITED Report on the Financial Statements We have audited the accompanying financial statements of M/s AAI CARGO LOGISTICS AND ALLIED SERVICES COMPANY LIMITED (a wholly owned subsidiary of M/s Airports Authority of India, a Body Corporate set up under The Airports Authority of India Act, 1994) ("the company"), which comprise the Balance Sheet as at March 31, 2018, the Statement of Profit and Loss, the Cash Flow Statement for the year then ended and a summary of significant accounting policies and other explanatory information. Management's Responsibility for the Financial Statements The Company's Board of Directors is responsible for the matters stated in Section 135 (5) of the Company's Act ("the Act") with respect to the preparation of these financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the accounting principles generally accepted in India, including the Accounting Standards specified under Section 133 of the Act read with Rule 7 of the Companies (Accounts) Rules, 2014. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Company and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We have taken into account the provisions of the Act, the accounting and auditing standards and matters which are required to be included in the audit report under the provisions of the Act and the Rules made there under. We conducted our audit in accordance with the Standards on Auditing specified under section 143(10) of the Act. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal financial control relevant to the Company's preparation of the financial statements that give a true and fair view, in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by Company's Directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the financial statements. Opinion In our opinion and to the best of our information and according to the explanations given to us, the aforesaid financial statements give the information required by the Act in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: a) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2018; b) In the case of the Statement of Profit and Loss, of the profit for the year ended on that date; and c) In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. Emphasis of Matters We draw attention to the following matters: a) Note No.32 (b) - Transactions with the Parent Company, i.e., Airports Authority of India: The Parent Company has transferred the revenue amounting to ` 139,07,12,904/- and expenses amounting to ` 91,43,17,214/- through the approval from the board and revenue amounting to ` 389,124/- and expenses amounting to ` 76,03,632/- have been taken in the books of the Company on the basis of certification from the parent Company,

166 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

b) Note No. 32 (c) - Transfer of Fixed Assets : The parent Company has transferred the fixed assets amounting to ` 103,71,68,209/- through the approval of the board and the fixed assets amounting to ` 28,54,65,551/- have been taken into account by the Company on the basis of certification from the parent Company, c) Note No. 28 - Physical Verification of Fixed Assets : The Company has conducted the physical verification as per the program set by it, however, the deficiencies observed in the report is still under discussion so corresponding entries have not been taken place in the books of accounts, d) Note No. 30 - Security Deposit : Security Deposit in relation to Cargo Segment has been kept by the parent Company within their books of accounts and hence corresponding entries have not been passed in the books of the Company, e) Note No. 33 -Balances of Trade Receivables and Payables : Balances of Trade Receivables and Advances from Customers as well as balances of Trade Payables including the Capital Creditors are still under reconciliations and confirmations. Our opinion is not modified in respect of the aforesaid matters. Report on other Legal and Regulatory Requirements 1. As required by the Companies (Auditor's Report) Order, 2016 ("the Order") issued by the Central Government of India in terms of sub-section (11) of section 143 of the Act, we give in the Annexure-I a statement on the matters specified in paragraphs 3 and 4 of the order to the extent applicable, 2. We are enclosing our report in terms of Section 143(5) of the Act, on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, in the Annexure-II on the directions and sub-directions issued by the Comptroller and Auditor General of India. 3. As required by section 143 (3) of the Act, we report that: a. We have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purpose of our audit. b. In our opinion proper books of account as required by law have been kept by the Company so far as it appears from our examination of those books. c. The Balance Sheet, Statement of Profit and Loss, and Cash Flow Statement dealt with by this Report are in agreement with the books of account. d. In our opinion, the aforesaid financial statements comply with the Accounting Standards specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014; e. Being a Government Company, pursuant to the Notification No. GSR 463(E) dated 5th June 2015 issued by Ministry of Corporate Affairs, Government of India, provisions of sub-section (2) of Section 164 of the Companies Act, 2013, are not applicable to the Company; f. With respect to the adequacy of the internal financial controls over financial reporting of the Company and the operating effectiveness of such controls, refer to Annexure III; g. With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, in our opinion and to the best of our information and according to the explanations given to us: i) The Company has disclosed the impact of pending litigations on its financial position in its financial statements - Refer Note No. 25 to the financial statements; ii) The Company did not have long term contracts including derivative contracts for which there were any material foreseeable losses; iii) There were no amounts which were required to be transferred to the Investor Education and Protection Fund by the Company. For P.R. KUMAR & CO. Chartered Accountants Firm Reg. No. : 003186N

sd/- (Rahul Kathuria) Place: New Delhi Partner th Date: 11 September, 2018 M. No. 090657

23rd Annual Report 2017-18 167 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Annexure-I

ANNEXURE OF THE INDEPENDENT AUDITOR'S REPORT (Referred to paragraph (1) under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date) (i) (a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets. (b) We have been informed that the fixed assets of the Company are physically verified by the management according to a phased programme designed to cover all the items over a period of three years which, in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to the program, physical verification was carried out and discrepancies observed, pending management confirmation on such discrepancies, adjustments on account of such discrepancies have been postponed (also refer note no. 28 of financial statements). (c) According to the information and explanation given to us and on the basis of our examination of records of the Company, immovable fixed assets such as Land as such and Land appurtenant to the buildings has not been transferred to the Company and the buildings amounting to Rs. 70,00,11,447/- (being purchase cost), the title of such buildings are still in the name of the Parent Company, i.e., Airports Authority of India. (ii) The Company does not have any inventory and consequently, clauses (ii) of paragraph 3 of the Order are not applicable. (iii) According to the information and explanations provided to us, the Company has not granted any secured or unsecured loans to companies, firms, Limited Liability Partnerships or other parties covered in the register maintained under section 189 of the Companies Act, 2013, consequently, provisions of sub-clause (iii)(a),(b)&(c) of the Paragraph 3 of the Order are not applicable. (iv) The Company has not given any loan, guarantee, security or made investment as stipulated under Sections 185 & 186 of the Companies Act, consequently, clause (iv) of the Paragraph 3 of the Order is not applicable. (v) According to the information and explanation given to us, the Company has not accepted deposits as per the provisions of the Companies Act, 2013 and consequently, directives issued by the Reserve Bank of India; the provisions of section 73 to 76 or any other relevant provisions of the Companies Act, 2013 and the Rules framed there under are not applicable. (vi) According to the information and explanation given to us, maintenance of cost records as prescribed by the Central Government under Section 148(1) of the Companies Act, 2013 is not applicable to the Company as the Company does not meet the threshold limit laid down in Rule 3 of the Companies (Cost Records and Audit) Amendment Rule 2014. (vii) (a) The Company has been regular in depositing with appropriate authorities undisputed statutory dues including Income Tax, Goods and Services Tax, Wealth Tax, Customs Duty, Cess and other material statutory dues as applicable to it. Being a wholly owned subsidiary of M/s Airport Authority of India (Holding Company), all the employees other than Chief Executive Officer are on standby deputation basis, therefore, employees related statutory dues, such as Provident Fund, Employee State Insurance, Professional Tax as applicable, are being deducted and deposited by the Holding Company. (b) According to the information and explanations given to us, there are no disputed statutory dues, which have not been deposited as on March 31, 2018. (viii) In our opinion and according to the information and explanations given to us, the Company has not taken any loan or borrowing from financial institution, bank, government nor has issued debentures. Accordingly, clause (viii) of the Paragraph 3 of the Order is not applicable to the Company. (ix) According to the information and explanations given to us, the Company has not raised moneys by way of initial public offer (including debt instruments) and no term loan has been raised during the year, hence provisions under clause (ix) of the Paragraph 3 of the Order is not applicable to the Company. (x) In our opinion and according to the information and explanations given to us, no fraud has been noticed or reported by or upon the Company during the year, hence the provisions of clause (x) of the Paragraph (3) of the Order is not applicable to the Company. (xi) The Company has not paid or provided for the managerial remuneration during the financial year under audit, accordingly, in our opinion and according to the information and explanations given to us, clause 3 (xi) of the Order is not applicable.

168 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

(xii) The Company is not a Nidhi Company, hence in our opinion and according to the information and explanations given to us, clause 3 (xii) of the Order is not applicable. (xiii) As per the information and explanations provided to us, the Company has transacted with the related party, i.e., M/s Airports Authority of India (Parent Company) as per the provisions of the Section 177 and 188 of the Companies Act, 2013 and the disclosure has been done under the note no. 22 of the financial statements. (xiv) The Company has not made any preferential allotment or private placement of shares or fully or partly executable debentures during the year under review, accordingly, in our opinion and according to the information and explanations given to us, clause 3 (xiv) of the Order is not applicable. (xv) The Company has not entered into any non cash transactions with directors or persons connected with him, accordingly, in our opinion and according to the information and explanations given to us, clause 3 (xv) of the Order is not applicable. (xvi) The Company is not required to be registered under section 45-IA of the Reserve Bank of India Act, 1934, accordingly, in our opinion and according to the information and explanations given to us, clause 3 (xvi) of the Order is not applicable.

For P.R. KUMAR & CO. Chartered Accountants Firm Reg. No. : 003186N

sd/- (Rahul Kathuria) Place: New Delhi Partner th Date: 11 September, 2018 M. No. 090657

23rd Annual Report 2017-18 169 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Annexure-II

ANNEXURE OF THE INDEPENDENT AUDITOR'S REPORT (Referred to paragraph (2) under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date)

Sl.No. Query Response 1. Whether the Company has clear title/lease deeds The Company doesn't have any leasehold/freehold for freehold and leasehold land respectively? If land, hence not applicable, however, land appurtenant not, please state the area of freehold and to the buildings related to Cargo Segment have not leasehold land for which title/lease deeds are not been transferred by the parent Company, i.e., Airports available. Authority of India.

2. Whether there are any cases of waiver/write off of There were no cases of waiver / write-off of debts/loans/interest etc. If yes, the reasons debts/loans/interest. thereof and amount involved. 3. Whether proper records are maintained for There are no cases of inventories lying with third parties inventories lying with third parties and assets & assets received as gift from Govt. or other authorities received as gift/ grant(s) from the Government or other authorities.

For P.R. KUMAR & CO. Chartered Accountants Firm Reg. No. : 003186N

sd/- (Rahul Kathuria) Place: New Delhi Partner th Date: 11 September, 2018 M. No. 090657

170 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Annexure - III

ANNEXURE TO THE INDEPENDENT AUDITOR'S REPORT OF EVEN DATE ON THE FINANCIAL STATEMENTS OF AAI CARGO LOGISTICS AND ALLIED SERVICES COMPANY LIMITED

(Referred to paragraph {3(f)} under the heading of "Report on Other Legal and Regulatory Requirements" of our report of even date) [Report on the Internal Financial Controls under Clause (i) of Sub-section 3 of Section 143 of the Companies Act, 2013 ("the Act")] We have audited the internal financial controls over financial reporting of M/s AAI CARGO LOGISTICS AND ALLIED SERVICES COMPANY LIMITED ("the Company") as of March 31, 2018 in conjunction with our audit of the financial statements of the Company for the year ended on that date. Management's Responsibility for Internal Financial Controls The Company's management is responsible for establishing and maintaining internal financial controls based on the internal control over financial reporting criteria established by the Company considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to Company's policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information, as required under the Companies Act, 2013. Auditors' Responsibility Our responsibility is to express an opinion on the Company's internal financial controls over financial reporting based on our audit. We conducted our audit in accordance with the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting (the "Guidance Note") and the Standards on Auditing, to the extent applicable to an audit of internal financial controls, both issued by the Institute of Chartered Accountants of India. Because of the matter described in disclaimer of opinion paragraph below, we were not able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on internal financial control system over financial reporting of the Company. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion on the Company's internal financial controls system over financial reporting. Meaning of Internal Financial Controls Over Financial Reporting A Company's internal financial control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A Company's internal financial control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorisations of management and directors of the Company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the Company's assets that could have a material effect on the financial statements.

23rd Annual Report 2017-18 171 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

Opinion According to the information and explanation given to us, being the first year of operation of the Company, the Company is in the process of establishing its internal financial control over financial reporting on criteria based on or considering the essential components of internal control stated in the Guidance Note on Audit of Internal Financial Controls Over Financial Reporting issued by the Institute of Chartered Accountants of India. Because of this reason, we are unable to obtain sufficient appropriate audit evidence to provide a basis for our opinion whether the Company had adequate internal financial controls over financial reporting and whether such internal financial controls were operating effectively as at March 31, 2018. We have considered the disclaimer reported above in determining the nature, timing, and extent of audit tests applied in our audit of the financial statements of the Company, and the disclaimer does not affect our opinion on the financial statements of the Company.

For P.R. KUMAR & CO. Chartered Accountants Firm Reg. No. : 003186N

sd/- (Rahul Kathuria) Place: New Delhi Partner th Date: 11 September, 2018 M. No. 090657

172 23rd Annual Report 2017-18 Hkkjrh; foekuiÙku izkf/dj.k AIRPORTS AUTHORITY OF INDIA

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