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Notes to Accounts of Asian Hotels (East) Ltd.

Mar 31, 2014

1. Terms/rights attached to Equity Shares

Equity Shares

The Company has one class of equity shares having a par value of Rs.10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. 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.

Preference Shares

The rights, preferences and restrictions attached to the preference shares are in accordance with the provisions of the Companies Act, 1956, unless stated otherwise.

2. 1,14,01,782 equity shares of Rs.10 each fully paid up have been issued during the fiscal year ended 31st March 2010 pursuant to the scheme of Arrangement and Demerger approved by the Hon''ble High Court of Delhi vide order dated 13th January 2010.

Economic Assumptions

The discount rate and salary increases assumed are key financial assumptions and should be considered together; it is the difference or ''gap'' between these rates which is more important than the individual rates in isolation.

Discount Rate

The discounting rate is based on the gross redemption yield on medium to long-term risk free investments. For the current valuation a discount rate of 8.50 % p.a. compound, has been used.

Salary Escalation Rate

The salary escalation rate usually consists of at least three components, viz. Regular increments, price inflation and promotional increases. In addition to this any commitments by the management regarding future salary increases and the Company''s philosophy towards employee remuneration are also to be taken into account. Again a long- term view as to the trend in salary increase rates has to be taken rather than be guided by the escalation rates experienced in the immediate past, if they have been influenced by unusual factors.

3. As the Company is engaged in only one segment of Hotel Business, the disclosure requirements of Accounting Standard (AS-17) on "Segment Reporting" are not applicable. Further the Company operates only in India; hence additional information under geographical segments is also not applicable.

4. The disclosures relating to Micro, Small & Medium Enterprises Development Act, 2006 are as under :- i. The amount due to Micro and Small Enterprises as defined in The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been identified on the basis of information collected by the management. This has been relied upon by the Auditors.

5. Contingent Liabilities :

Contingent Liabilities 31st March 2014 31st March 2013

Corporate Guarantee to IDBI Bank for Robust Hotels Pvt. Ltd. 2,400,000,000 2,400,000,000

Letter of Credit issued by IDBI Bank Ltd. in favour of

West Bengal Electricity Distribution Company Limited 6,000,000 6,000,000

Sales Tax under West Bengal Sales Tax Act, 1994 pertaining to F. Y. 2007-08 - 211,767

Sales Tax under West Bengal Sales Tax Act, 1994 pertaining to F. Y.2008-09 - 528,286

VAT under West Bengal Value Added Tax Act, 2003 pertaining to F. Y. 2006-07 - 2,531,538

VAT under West Bengal Value Added Tax Act, 2003 pertaining to F. Y. 2008-09 - 2,197,722

Service Ta x under the Finance Act, 1994 pertaining to prior to F. Y. 2004-05 4,374,245 4,374,245

Service Ta x under the Finance Act, 1994 pertaining to F. Y. 2003-04 to F. Y. 2006-07 10,217,937 10,217,937

Service Ta x under the Finance Act, 1994 pertaining to F. Y. 2007-08 to F. Y. 2009-10 26,753,749 26,753,749

ESIC under the Employees'' State Insurance Act, 1948 pertaining to F. Y. 2004-05 2,180,235 2,180,235

ESIC under the Employees'' State Insurance Act, 1948 pertaining to F. Y.2007-08 - 243,659

States Consumer Disputes Redressal Commission West Bengal - 9,800,000

Commitments

Export Obligation in respect of EPCG Licences 24,301,279 24,301,279

6. As on date, the Company holds 91,652 Equity shares of Rs.10 each of its subsidiaries, Regency Convention Centre and Hotels Limited (RCC), representing 58.99% of the paid up capital of RCC. Apart from the above, the Company had also made an advance of Rs.33,448,275 for acquiring further shares of RCC from their existing shareholders and paid advances to Regency Convention Centre and Hotels Limited amounting to Rs.11,569,474 up to the Balance Sheet date which has been disclosed as Short Term Loans and Advances.

The principal assets of Regency Convention Centre and Hotels Limited comprise of an interest in a parcel of land at Mumbai, such interest being the subject matter of dispute pending in the Bombay High Court. However Regency Convention Centre and Hotels Limited, as per opinion obtained, has a reasonable chance of winning the ongoing legal dispute. Such assets form part of the Company''s undertaking at book values. Meanwhile the authorities have offered alternate land and negotiations on commercial terms are in progress. Consequently in view of the above, no impairment is considered necessar y.

As per the terms of agreement with the Regency Convention Centre and Hotels Limited and its shareholders, the Company has to make additional payment for acquiring the balance shares of Regency Convention Centre and Hotels Limited, the amount of which is unascertainable and dependent on the outcome of the dispute pending in the Bombay High Court.

7. The leasehold land upon which Hotel Hyatt Regency Kolkata is situated has been registered in the name of the Company.

8. In the opinion of the Board, all the assets of the Company have a value on realization in ordinary course of business at least equal to the amount at which they are stated. Therefore, the Company has not recognised any loss on impairment in respect of any of the assets of the Company. In respect of subsidiaries, such decision is based on the audited accounts of the subsidiaries.

9. The Company has extended the date of redemption of 43,00,000 12% Cumulative Redeemable Preference Shares of Robust Hotels Private Limited to July 5, 2016 unless mutually agreed upon for further rollover.

10. The Board of Directors of the Company at their meeting held on 26th November 2012 and 23rd May 2013 and in consideration of SEBI Circular Nos. CIR/CFD/DIL/5/2013 and CIR/CFD/DIL/8/2013 dated 4th February 2013 and 21st May 2013 respectively, approved the amalgamation of Forex Finance Private Limited, Promoter Body Corporate with the Company w.e.f. 1st April 2012 (appointed date). Post amalgamation, Robust Hotels Private Limited, owner of Hyatt Regency Chennai, will be a wholly owned subsidiary of the Company; partially by having direct holding and balance through GJS Hotels Limited (wholly owned subsidiary of the Company). The Company is in the process of obtaining regulator y approvals for the amalgamation.

11. In accordance with the Accounting Standard on "Related Party Disclosures" (AS-18), the disclosures in respect of Related Parties and transactions with them are as follows: -

Related Party Disclosures

(i) List of Related Parties

(a) Subsidiaries : GJS Hotels Limited

Regency Convention Centre & Hotels Limited

Robust Hotels Private Limited (subsidiary of GJS Hotels Limited)

(b) Key Management Personnel : Radhe Shyam Saraf, Chairman Umesh Saraf, Joint Managing Director Arun Kumar Saraf, Joint Managing Director

(c) Entities over which directors or their relatives can exercise significant influence/control :

(i) Nepal Travel Agency Pvt. Ltd.

(ii) Unison Hotels Private Limited

(iii) Vedic Hotels Limited

(iv) Unison Power Limited (v) Unison Hotels South Private Limited

(vi) Juniper Hotels Private Limited

(vii) Yak & Yeti Hotels Limited, Nepal

(viii) Taragaon Regency Hotels Limited, Nepal

(ix) Saraf Investments Limited, Mauritius

(x) Saraf Industries Limited, Mauritius

(xi) Sara Hospitality Limited, Hong Kong

(xii) Juniper Investments Limited

(xiii) Chartered Hotels Private Limited

(xiv) Blue Energy Private Limited

(xv) Footsteps of Buddha Hotels Private Limited

(xvi) Sara International limited, Hong Kong

(xvii) Samra Importex Private Limited

(xviii) Forex Finance Private Limited

(xix) Saraf Hotels Limited, Mauritius

(xx) Chartered Hampi Hotels Private Limited

12. Previous Year figures have been regrouped / reclassified, wherever necessary to confirm to current year''s classification.

13. There is no other additional material information required to be disclosed pursuant to the provisions of the Companies Act, 1956, Schedule VI to the Companies Act, 1956, Companies (Accounting Standards) Rules, 2006 and other material applicable enactments, circulars, orders, notifications etc.


Mar 31, 2013

1. Corporate Overview

Asian Hotels (East) Limited is a Public Limited Company listed with Bombay Stock Exchange and National Stock Exchange and is primarily engaged in the Hotel business through "Hyatt Regency Kolkata" a five-star Hotel situated in the city of Kolkata.

2. Basis of Preparation

The financial statements have been prepared to comply with all material respects with the mandatory Accounting Standards (AS) notified under section 211(3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below, if any.

3. As the Company is engaged in only one segment of Hotel Business, the disclosure requirements of Accounting Standard (AS-17) on "Segment Reporting" are not applicable. Further the Company operates only in India; hence additional information under geographical segments is also not applicable.

4. The disclosures relating to Micro, Small & Medium Enterprises Development Act, 2006 are as under :- i. The amount due to Micro and Small Enterprises as defined in "The Micro, Small and Medium Enterprises Development Act, 2006" has been determined to the extent such parties have been identified on the basis of information collected by the management. This has been relied upon by the Auditors.

5. As on date, the Company holds 91,652 Equity shares of Rs.10 each of its subsidiaries, Regency Convention Centre and Hotels Limited (RCC), representing 58.99% of the paid up capital of RCC. Apart from the above, the Company had also made an advance of Rs.33,448,275 for acquiring further shares of RCC from their existing shareholders and paid advances to Regency Convention Centre and Hotels Limited amounting to Rs.10,869,474 up to the Balance Sheet date which has been disclosed as Short Term Loans and Advances.

The principal assets of Regency Convention Centre and Hotels Limited comprise of an interest in a parcel of land at Mumbai, such interest being the subject matter of dispute pending in the Bombay High Court. However Regency Convention Centre and Hotels Limited, as per opinion obtained, has a reasonable chance of winning the ongoing legal dispute. Such assets form part of the Company''s undertaking at book values. Meanwhile the authorities have offered alternate land and negotiations on commercial terms are in progress. Consequently in view of the above, no impairment is considered necessary.

As per the terms of agreement with the Regency Convention Centre and Hotels Limited and its shareholders, the Company has to make additional payment for acquiring the balance shares of Regency Convention Centre and Hotels Limited, the amount of which is unascertainable and dependent on the outcome of the dispute pending in the Bombay High Court.

6. Pursuant to the Scheme of Arrangement & Demerger, the Company had obtained approval of the Government of West Bengal for the vesting of the leasehold property upon which Hotel Hyatt Regency Kolkata is situated. Liabilities for registration of the same will be determined as and when the registration is done.

7. In the opinion of the Board, all the assets of the Company have a value on realization in ordinary course of business at least equal to the amount at which they are stated. Therefore, the Company has not recognised any loss on impairment in respect of any of the assets of the Company. In respect of subsidiaries, such decision is based on the audited accounts of the subsidiaries.

8. During the year, GJS Hotels Limited, a wholly owned Subsidiary of the Company has exercised its option to convert the Cumulative Redeemable Optional Convertible Preference Shares in Robust Hotels Private Limited and consequently 63,932,769 equity shares of Rs.10/- each were issued to GJS Hotels Limited at a conversion price of Rs.32/- per share. Subsequent to the allotment, Robust Hotels Private Limited, the owner of Hyatt Regency Chennai has become the subsidiary of GJS Hotels Limited, a wholly owned subsidiary of the Company. As a result, Robust Hotels Private Limited has become the Subsidiary of the Company w.e.f. 26th July 2012.

9. In accordance with the Accounting Standard on "Related Party Disclosures" (AS-18), the disclosures in respect of Related Parties and transactions with them are as follows: -

Related Party Disclosures

(i) List of Related Parties

(a) Subsidiaries : GJS Hotels Limited

Regency Convention Centre and Hotels Limited

Robust Hotels Private Limited (was an entity over which directors or their relatives exercised significant influence / control till 26th

July 2012)

(b) Key Management Personnel : Umesh Saraf

Arun Kumar Saraf

(c) Entities over which directors or their relatives can exercise significant influence/control :

(i) Nepal Travel Agency Pvt. Ltd.

(ii) Unison Hotels Private Limited

(iii) Vedic Hotels Limited

(iv) Unison Power Limited

(v) Unison Hotels South Private Limited

(vi) Juniper Hotels Private Limited

(vii) Yak & Yeti Hotels Limited, Nepal

(viii) Taragaon Regency Hotels Limited, Nepal

(ix) Saraf Investments Limited, Mauritius

(x) Saraf Industries Limited, Mauritius

(xi) Sara Hospitality Limited, Hong Kong

(xii) Juniper Investments Limited

(xiii) Chartered Hotels Private Limited

(xiv) Blue Energy Private Limited

(xv) Footsteps of Buddha Hotels Private Limited

(xvi) Sara International limited, Hong Kong

(xvii) Samra Importex Private Limited

(xviii)Forex Finance Private Limited

(xix) Saraf Hotels Limited, Mauritius

10. The Board of Directors of the Company at their meeting held on 26th November 2012 and 23rd May 2013 and in consideration of SEBI Circular Nos. CIR/CFD/DIL/5/2013 and CIR/CFD/DIL/8/2013 dated 4th February 2013 and 21st May 2013 respectively, approved the amalgamation of Forex Finance Private Limited, Promoter Body Corporate with the Company. Post amalgamation, Robust Hotels Private Limited, owner of Hyatt Regency Chennai, will be a wholly owned subsidiary of the Company; partially by having direct holding and balance through GJS Hotels Limited (wholly owned subsidiary of the Company). The Company is in the process of obtaining regulatory approvals for the amalgamation.

11. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances of Rs. NIL) Rs.NIL (Previous Year Rs. 2,079,031).

12. Previous Year figures have been regrouped / reclassified, wherever necessary to confirm to current year''s classification.

13. There are no other additional material information required to be disclosed pursuant to the provisions of the Companies Act, 1956, Schedule VI to the Companies Act, 1956, Companies (Accounting Standards) Rules, 2006 and other material applicable enactments, circulars, orders, notifications etc.


Mar 31, 2012

1. Corporate Overview

Asian Hotels (East) Limited is a Public Limited Company listed with Bombay Stock Exchange and National Stock Exchange and is primarily engaged in the Hotel business through "Hyatt Regency Kolkata11 a five-star Hotel situated in the city of Kolkata.

2. Basis of Preparation

The financial statements have been prepared to comply with all material respects with the mandatory Accounting Standards (AS) notified under section 211(3C) of the Companies Act, 1956 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below, if any.

3.1 Conversion of Fully Convertible Preference Shares : The Company vide Circular Resolution dated 30th April 2011, has issued and allotted fresh 38,910 equity shares of Rs10 each at a price of Rs385.53 per share (including security premium of Rs375.53 per share) to the holders of Fully Convertible Preference Shares (FCPS) holding 27,780 FCPS on conversion in terms of Clause 5.3.1 of the Scheme of Arrangement and Demerger between Asian Hotels Limited (Transferor Company) now renamed as Asian Hotels (North) Limited and its shareholders and creditors; Chillwinds Hotels Limited (Transferee Company-I) now renamed as Asian Hotels (West) Limited and its shareholders; and Vardhman Hotels Limited (Transferee Company-II) now renamed as Asian Hotels (East) Limited and it shareholders read with Chapter VII of SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

Subsequently, the company made applications to Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE), where the shares of the company are listed, for obtaining the in principle approval for the said issue and allotment of 38,910 equity shares.

While dealing with the Company's application for issue of in-principle approval by BSE and NSE, the Company was directed by them, to revise the issue price of Rs385.53. Accordingly, the Board of Directors of the Company considered the directions of the Stock Exchanges and revised the earlier issue price from Rs385.53 to Rs386.59 and consequently issued and allotted 38,803 equity shares of Rs10 each of the company with effect from 30th April, 2011, vide its Circular Resolution dated 4th July, 2011, in suspension to its earlier Board Resolution dated 30th April, 2011.

3.2 Terms/rights attached to Equity Shares Equity Shares

The Company has one class of equity shares having a par value of Rs10 each. Each shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. 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.

3.3 11,401,782 equity shares of Rs10 each fully paid up have been issued during the fiscal year ended 31 st March, 2010 pursuant to the scheme of Arrangement and Demerger approved by the Hon'ble Height Court of Delhi vide order dated 13th January 2010.

4. Gratuity and other post-employment benefit plans

The Company has classified the various benefits provided to employees as under:-

a) Defined contribution plans i. Provident fund

b) Defined benefit plans

i. Contribution to Gratuity fund

ii. Compensated absences Earned leave

In accordance with Accounting Standard 15 (revised 2005), actuarial valuation was done in respect of the aforesaid defined plans based on the following assumptions: -

Economic Assumptions

The discount rate and salary increases assumed are key financial assumptions and should be considered together; it is the difference or gap' between these rates which is more important than the individual rates in isolation.

Discount Rate

The discounting rate is based on the gross redemption yield on medium to long-term risk free investments. For the current valuation a discount rate of 9 % p.a. compound, has been used.

Salary Escalation Rate

The salary escalation rate usually consists of at least three components, viz. Regular increments, price inflation and promotional increases. In addition to this any commitments by the management regarding future salary increases and the Company's philosophy towards employee remuneration are also to be taken into account. Again a long- term view as to the trend in salary increase rates has to be taken rather than be guided by the escalation rates experienced in the immediate past, if they have been influenced by unusual factors.

Notes:

1. The discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of obligations.

2. The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market.

3. The gratuity plan and earned leave is unfunded.

5. As the company is engaged in only one segment of Hotel business, the disclosure requirements of Accounting Standard (AS-17) on Segment Reporting are not applicable.

6. The Company had sent letters to its suppliers for confirmation of their status and registration under Micro, Small and Medium Enterprises (Development) Act, 2006 and the company has not received any intimation from any of its suppliers regarding their status under the said Act and hence disclosure, if any, relating to amounts unpaid as at the year end along with interest paid / payable as required under the said Act have not been given.

7. Contingent Liabilities :

a. Export obligation in respect of EPCG Licenses: Rs2,43,01,279 (Previous year Rs2,43,01,279).

b. Claims against the Company not acknowledged as debts:

i) Sales Tax/VAT Rs55,82,211 (Previous Year Rs28,56,304 )

ii) Service Tax Rs1,02,89,320 (Previous Year Rs1,45,97,672 )

iii) ESIC Rs21,80,235 (Previous Year Rs Rs21,80,235)

iv) Letter of Credit for Rs50,00,000 issued by IDBI Bank Ltd in favour of West Bengal Electricity Distribution Company Ltd. (Previous Year Rs50,00,000 )

v) Suit instituted by a party before State Consumer Disputes Reddressal Commission, West Bengal Rs 98,00,000 (Previous Year Rs98,00,000 )

8. As on date, the Company holds 91,652 Equity shares of Rs10 each of its subsidiaries, Regency Convention Centre and Hotels Limited (RCC), representing 58.99% of the paid up capital of RCC. Apart from the above, the Company had also made an advance of Rs3,34,48,275 for acquiring further shares of RCC from their existing shareholders and paid advances to Regency Convention Centre and Hotels Limited amounting to Rs1,00,69,474 up to the Balance Sheet date which has been disclosed as a recoverable advance.

The principal assets of Regency Convention Centre and Hotels Limited comprise of an interest in a parcel of land at Mumbai, such interest being the subject matter of dispute pending in the Bombay High Court. However Regency Convention Centre and Hotels Limited is in possession of opinions given by the highest legal authorities clearly stating that Regency Convention Centre and Hotels limited has a reasonable chance of winning the ongoing legal dispute. Such assets form part of the Company's undertaking at book values.

The value of the above assets is primarily dependent on the legal dispute and is, therefore, subject matter of uncertainty at this juncture. As such, the ultimate outcome of the matter and, therefore, whether there is impairment, if any, in the value of the aforesaid assets cannot be reasonably determined at present. As per the earlier terms of agreement with the Regency Convention Centre and Hotels Limited and its shareholders, the company has to make additional payment for acquiring the balance shares of Regency Convention Centre and Hotels Limited, the amount of which is unascertainable and dependent on the outcome of the dispute is pending in the Bombay High Court.

9. Pursuant to the Scheme of Arrangement & Demerger, the company had obtained approval of the Government of West Bengal for the vesting of the leasehold property upon which Hotel Hyatt Regency Kolkata is situated. Liabilities for registration of the same will be determined as and when the registration is done.

10. The Company has not recognized any loss on impairment in respect of assets of the Company since there is no reduction in value of any asset. In respect of subsidiaries, such decision is based on the audited accounts of the subsidiaries.

11. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs 20,79,031 (Previous Year Rs Nil)

12. Till the year ended 31st March 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the company. The Company has reclassified previous year figures to conform to this year's classification.

13. There are no other disclosure requirements which need to be disclosed as per Accounting Standard and Revised Schedule VI to the Companies Act 1956.


Mar 31, 2010

1. Contingent Liabilities not provided for in respect of:

a. Export obligation in respect of EPCG Licenses: Rs. 243.01 lacs (Previous year Rs Nil).

b. Claims against the Company not acknowledged as debts: Rs. 169.26 lacs. (Previous year - Rs. Nil)

2. As on date, the Company holds 91,652 Equity shares of Rs. 10/- each of its subsidiary, Regency Convention Centre and Hotels Limited (RCC), representing 58.99% of the paid up capital of RCC. Apart from the above, the Company had also made an advance of Rs. 334 lacs for acquiring further shares of RCC from their existing shareholders and incurred expenditure on behalf of Regency Convention Centre amounting to Rs.68.87 Lacs up to the Balance Sheet date which has been disclosed as a recoverable advance.

The principal assets of RCC comprise of an interest in a parcel of land at Mumbai, such interest being the subject matter of dispute pending in the Bombay High Court. However, RCC has been legally advised by its lawyers that it has a good chance of success. An independent broker has also made an indicative offer to the Company for its interest in RCC at a value which is higher than the book value being reflected in the books of the Company. Such assets form part of the Companys undertaking at book values.

The value of the above assets is primarily dependent on the legal dispute and is, therefore, subject matter of uncertainty at this juncture. As such, the ultimate outcome of the matter and, therefore, whether there is impairment, if any, in the value of the aforesaid assets cannot be reasonably determined at present.

3. Pursuant to the Scheme of Arrangement and Demerger Cthe Scheme) of trifurcation of Asian Hotels Limited (AHL) approved by the Honble High Court of Delhi at New Delhi on 13 January, 2010, Kolkata Undertaking of AHL comprising of Hotel Hyatt Regency, Kolkata along with shares held in G.J.S. Hotels Limited, Regency Convention Centre and Hotels Limited and others stands transferred to and vested in the Company.

Features of the Scheme as applicable to the Company are as under:

a. Appointed date for the Scheme is 31 October, 2009.

b. Effective date for the Scheme is 11 February, 2010, being the date when the Order of Honble High Court has been filed with the Office of the Registrar of Companies, NCT of Delhi and Haryana.

c. In terms of the scheme, on the effectiveness of the Scheme, the paid- up equity share capital of the Transferor Company - Asian Hotels Limited (AHL) before Demerger, amounting to Rs.22,80,35,640/- was deemed to have increased to Rs. 34,20,53,460/- as a result of appropriation of the general reserves to the extent of Rs. 11,40,17,820/- and the deemed increased paid up equity capital of the Transferor Company was equally allocated to the three undertakings at demerger so that each of AHL Residual undertaking. Transferee Company-I and Transferee Company -II would have a paid up equity share Capital of Rs. 11,40,17,820/- as at 31st October, 2009, being the Appointed Date. As a result thereof, for every 3 equity shares of Rs. 10/- held in AHL after appropriation of reserves as on the Record Date, every equity shareholder of AHL is entitled to receive 1 equity share of face value of Rs. 10/- each of the Company credited as fully paid up.

d. As per terms of the Scheme, the Company re-issued 1,00,000 1% redeemable Non Convertible Preference Shares as per the following:

i. 50,000 1% non convertible redeemable preference shares of face value of Rs 10/- each of the Company to Magus Estate and Hotels Private Limited credited as fully paid up.

ii. 50,000 1% non convertible redeemable preference shares of face value of Rs 10/- each of the Company to Infrastructure Development Finance Company Limited credited as fully paid up.

e. As per terms of the Scheme, the Company re-issued 27,780 1% Fully Convertible Preference Share (FCPS) as per the following:

i. 18,520 FCPS of face value of Rs. 10/- each of the Company to Fineline Holdings Limited credited as fully paid.

ii. 9,260 FCPS of face value of Rs. 10/- each of the Company to Global Operations Pte. Ltd. (through its nominee UDT Enterprises Pty. Ltd.) credited as fully paid.

4. The Company had filed necessary application for listing of equity shares of the Company alongwith necessary documents and annexure with Bombay Stock Exchange Limited and the National Stock Exchange of India Limited on 6th April, 2010. Subsequent to Companys application BSE being the designated Stock Exchange has given its approval of Listing; and SEBI has also given relaxation under Rule 19(2)(b) of the Securities Contracts Regulation Act, 1957 vide its letter dtd. 28th July 2010.

5. The Company has not recognised any loss on impairment in respect of assets of the Company as is required in terms of Accounting Standard 28 on "Impairment of Assets" since in the opinion of the Management, there is no reduction in value of any asset. In respect of subsidiaries, such decision is based on the management accounts/audited accounts of the subsidiaries, as available and on the basis of the information and explanations given.

6. The Company has received notices with regard to Service tax demand on certain services aggregating to Rs. 14.58 lacs and also penalty amounting to Rs. 29.16 lacs. Further, the company has also received notice from Service tax department demanding Rs. 102.17 lacs regarding alleged wrong availment of CENVAT credit. Both are considered to be not tenable in the opinion of the company. These are thus included under "Contingent liabilities" as "Claims against Company not acknowledged as debts" and no provision has been made against the same.

7. As the Company is engaged in only one segment of Hotel business, the disclosure requirements of Accounting Standard (AS-17) on "Segment Reporting" are not applicable.

8. The Company has classified the various benefits provided to employees as under:-

a) Defined contribution plans

i. Provident fund

b) Defined benefits plans

i. Contribution to Gratuity funds

ii. Compensated absences - Earned leave

In accordance with Accounting Standard 15 (revised 2005), actuarial valuation was done in respect of the aforesaid defined plans based on the following assumptions: -

Economic Assumptions

The discount rate and salary increases assumed are key financial assumptions and should be considered together; it is the difference or gap between these rates which is more important than the individual rates in isolation.

Discount Rate

The discounting rate is based on the gross redemption yield on medium to long-term risk free investments. For the current valuation a discount rate of 8 % p.a. compound, has been used in consultation with the employer.

Salary Escalation Rate

The salary escalation rate usually consists of at least three components, viz. Regular increments, price inflation and promotional increases. In addition to this any commitments by the management regarding future salary increases and the Companys philosophy towards employee remuneration are also to be taken into account. Again a long- term view as to the trend in salary increase rates has to be taken rather than be guided by the escalation rates experienced in the immediate past, if they have been influenced by unusual factors.

a. The following tables set out the unfunded status of the gratuity plan and earned leaves and amounts recognised in the Companys financial statements as at 31 March, 2010:

Notes:

1. The discount rate is based on the prevailing market yields of Indian Government securities as at the balance sheet date for the estimated term of obligations.

2. The estimates of future salary increases considered take into account the inflation, seniority, promotion and other relevant factors.

3. The gratuity plan and earned leave is unfunded.

9. The Company has applied to the Ministry of Corporate Affairs, Government of India under section 211(4) of the Companies Act, 1956 for getting exemption with regard to disclosures in respect of quantitative details of turnover, opening and closing stock, purchases, production and consumption of raw material. The final approval is awaited pending which the said disclosures are not being furnished.

10. The Company had sent letters to its suppliers for confirmation of their registration under "Micro, small and medium Enterprises Development Act, 2006" and the company has not received any intimation from any of its suppliers regarding their status under the said Act and hence disclosure, if any, relating to amounts unpaid as at the year-end along with interest paid / payable as required under the said Act have not been given.

11. The name of the Company has been changed from Vardhman Hotels Limited to Asian Hotels (East) Limited effective 16th February 2010.

12. Schedules 1 to 16 form an integral part of the Balance Sheet as at 31 March, 2010 and the Profit and Loss Account for the nine months period ended 31 March, 2010.

13. Previous year financial statements are for fifteen months whereas current year financial statements are for nine months. Hence, current year figures are not comparable with previous year figures. Current years financial statements also include only five months operations of Hotel Hyatt Regency Kolkata which was not there in the previous year.

14. Previous year figures have been regrouped/ reclassified wherever necessary to conform to current year classification.


Jun 30, 2009

1. Contingent Liabilities:

(a) Outstanding Capital Expenditure Commitments 718.10 1577.29

(b) Claims against the Company not acknowledged as debts 617.18 653.01

(c) Demand for income tax (exclusive of interest amounting to Rs.NIL Prior Year Rs 109.59 Lakhs) not provided for pending appeals - 113.25

14. Capital Work-in-Progress consists of:

(a) Renovation/refurbishing work / other work in progress 615.39 681.31

(b) Advances for capital contracts (unsecured, considered good) 138.17 3330.72

753.56 4012.03 2. The Company, based on the report by a Certified Valuer, had revalued land and building of Hotel Hyatt Regency Delhi by adopting Cost of Contractors method, on 28th February 2007 at Rs. 85,700.00 Lakhs, the same resulted in an increase in the value of land and building of an amount of Rs. 82,131.81 Lakhs, and therefore an equivalent amount had been credited to the Revaluation Reserve Account. Due to increase in the value of assets, there was an additional charge of Rs. 80.87 Lakhs (Prior year Rs.53.91 Lakhs), for the current period, on account of depreciation. Resultantly, an equivalent amount of Rs 80.87 Lakhs (Prior year Rs.53.91 Lakhs) has been withdrawn from the Revaluation Reserve Account and credited to the Profit & Loss Account.

3. At the beginning of the current period, the Company held 75000 equity shares of Rs.10/- each of Regency Convention Centre and Hotels Ltd (RCC), representing 48.28% of paid up equity capital of RCC, acquired for a consideration of Rs. 173.02 Lakhs. During the current period, the Company acquired a further 16652 equity shares of RCC for a consideration amounting to Rs.2400 Lakhs, by virtue of which the aggregate share holding of the Company in RCC stood at 58.99% of the paid up capital of RCC, thus making it a subsidiary of the Company. Apart from the above, the Company, during the prior years, had also made an advance of Rs. 334 Lakhs for acquiring further shares of RCC from their existing shareholders and incurred expenditure on behalf of RCC amounting to Rs. 55.82 Lakhs upto the balance sheet date.

The principal assets of RCC comprises of an interest in a parcel of land at Mumbai, the right in such interest is being contested in the Bombay High Court. However, the Company has been legally advised that it has a fair chance of success. An independet broker has also made an indicative offer to the Company for its interest in RCC at a value which is higher than the book value being reflected in the books of the Company. In the proposed Scheme of Arrangement and Demerger of the Company (Refer Note 18 below) the aforesaid assets forms part of Kolkata undertaking at their book value. Considering that the value of the asset is contingent upon the outcome of legal proceedings, as suggested supra, in the light of present uncertainty about the outcome of the matter, and, therefore, whether there is impairment, if any, the value of the aforesaid assets can not be reasonably determined at present.

In view of the above, no provision for impairment in respect of said assets has been made in these financial statements.

4. The Company has not recognised any loss on impairment in respect of assets of the Company as is required in terms of Accounting Standard (AS) 28 on "Impairment of Assets" since in the opinion of the Management, as confirmed by the Audit Committee, the reduction in value of any asset, to the extent required, has already been provided for in the books. In respect of subsidiaries such decision is based on the management accounts/ audited accounts of the subsidiaries, as available and as examined by the Audit Committee on the basis of the information and explanations available.

5. Presently, the Company is operating an integrated hotel business at three geographical locations. These hotels namely Hyatt Regency Delhi, Hyatt Regency Kolkata and Hyatt Regency Mumbai are governed by the same set of risks and returns and hence have been considered as representing a Single Segment.

A Scheme of Arrangement and Demerger (the Scheme) was approved by the Board of Directors of the Company on 14th May, 2007. The Scheme envisaged the trifurcation of the Company in the following manner:-

i) Kolkata Undertaking as defined in clause 1.2.1 of the Scheme, comprising interalia of Hotel Hyatt Regency Kolkata and investments in the shares held in GJS Hotels Limited and Regency Convention Centre and Hotels Limited, and appropriate cash liquidity.

ii) Mumbai Undertaking as defined in clause 1.2.1 of the Scheme, comprising interalia of Hotel Hyatt Regency Mumbai, investments in the shares held in Aria Hotels & Consultancy Services Private Limited and deposits/advances paid towards acquisition of immovable property in Bangalore.

iii) AHL Residual as would emerge immediately after the transfer of and vesting in of Mumbai Undertaking and the Kolkata Undertaking in Chillwinds Hotels Limited (Transferee Company -I) and Vardhman Hotels Limited (Transferee Company-ll) respectively.

The Scheme, which was approved by the High Court of Delhi vide its order dated 29th February, 2008 and amended vide Orders dated 9th April, 2009 and 18th August, 2009, was filed with the Registrar of Companies, NCT of Delhi & Haryana, but could not take effect as certain conditions precedent were yet to be fulfilled. In order to overcome the impediments in implementation of the Scheme and to determine a fixed date which should be the Appointed Date for the purpose of drawing up the undertaking wise balance sheets in terms of the Scheme, the Company made an application to the Honble Court in May 2009, introducing the Appointed Date and incorporated certain clauses to define how the business of the three undertakings would be conducted between the Appointed Date and the Effective Date. The Honble High Court vide its order dated 29th May, 2009, stayed the effect and implementation of the Scheme, as approved earlier and directed the Company to obtain the approval of its equity shareholders for the amended Scheme. The Company made additional applications in August 2009 and November 2009, for further amendments, before the equity shareholders meeting could be convened in terms of Order dated 29th May, 2009, and the Honble Court vide its Order dated 10th November, 2009, directed the Company to convene a meeting of its equity shareholders on 11th December, 2009, to obtain their approval for the amended Scheme. Pursuant to the directions of the Honble Court, the Company has called its equity shareholders meeting on 11th December, 2009. Once the amended Scheme is approved by the equity shareholders and sanctioned by the Honble Court, the amended Scheme is expected to be implemented by the end of January 2010 having retrospective effect from the Appointed Date i.e. 31 st October, 2009. Subsequent thereto, the Promoter Groups intend to transfer their shareholding inter-se in the three demerged entities as provided in Clause 5.8 of the Scheme.

In view of the above, within the meaning of Accounting Standard (AS) 24 on "Discontinuing Operations", the operations of Kolkata undertaking and Mumbai undertaking constitute discontinuing operations. As at 30th September, 2009, the carrying amount of the assets of the Kolkata undertaking were Rs 40112.29 Lakhs (prior year Rs 38731.48 Lakhs), and of the Mumbai undertaking were Rs 39429.73 Lakhs (prior year Rs 42005.98 Lakhs) and their liabilities were Rs 22028.95 Lakhs (prior year Rs 21094.39 Lakhs) and Rs 29111.48 Lakhs (prior year Rs 30353.95 Lakhs) respectively.

The following statement shows the revenue and expenditure of continuing and discontinuing operations of the Company.

6. Letters for confirmation of balances sent to parties have been received back only in a few cases and discrepancies, if any, pointed out by the parties are being investigated for necessary adjustments to be carried out.

7. Loans and advances include a claim in respect of stamp duty lodged with Maharashtra Tourism Development Corporation (MTDC) by the Company relating to land of Hotel Hyatt Regency Mumbai, considered to be fully recoverable in the opinion of the Management and as confirmed by the Audit Committee, as per letter subsequent to the balance sheet date received from MTDC.

8. Out of the Service Tax demand raised and paid during the prior year for Rs.146.11 Lakhs, Rs. 95.94 Lakhs had been paid under protest. In the opinion of the Company, amount paid under protest is not liable to be paid and hence has been included under "Loans & Advances" as "Claims Recoverable" vide application dated May 9, 2008. The Company has also received notices with regard to Service Tax demand on certain services aggregating to Rs.482.54 Lakhs considered not tenable in the opinion of the Company. These are thus included under "Contingent Liabilities" as "Claims against the Company not acknowledged as debts" and no provision has been made against the same.

9. (a) Computation of Net Profit as per Section 349 read with Section 309 (5) and Section 198 of the Companies Act, 1956 Profit before tax Add/ (Less):

Loss on Fixed Assets sold / discarded (net) Loss/(Gain) on sale of investments (net) Provision no longer required written back Provision for Diminution in value of Investment written back Provision for Doubtful debts / advances Provision for Wealth Tax ( net) NET PROFIT AS PER SECTION 349 Managerial Remuneration (as stated below) PROFIT AS PER SECTION 198 Commission @ 2% amounting to Rs. 346.92 Lakhs (prior year Rs. 395.53 Lakhs) of the above payable to each of the three Managing Directors included under the head "Salaries, Wages and Ex Gratia" aggregating to :

Commission payable to each of the Eight Non Executive Directors @ 1% of Profit as above subject to maximum of Rs 5 Lakhs (prior year Rs.5 Lakhs) per Director per annum included under the head "Salaries, Wages and Ex Gratia" aggregating to : * includes commission of Rs.2.5 Lakhs to each non-executive director pending approval at the annual general meeting. (b) Managerial Remuneration (excluding provision for gratuity) to Directors : Salaries

House Rent Allowance Commission

Provident Fund Contribution Monetary value of Perquisites

10. The Company is presently operating an integrated hotel business at three geographical locations. The operations of these hotels namely Hyatt Regency Delhi, Hyatt Regency Kolkata and Hyatt Regency Mumbai are governed by the same set of risks and returns and hence have been considered as representing a Single Segment. The said treatment is in accordance with the guiding principles enunciated in the Accounting Standard (AS)- 17 on Segment Reporting. The Company, during the prior year, had altered its object clause of memorandum of association and entered into a different business segment, viz., power generation, governed by different risks and returns. However, it is not a reportable segment as defined under the said Accounting Standard, and therefore, no separate disclosures have been made. The assets, liabilities and revenues relating to the said business have however, been disclosed in the accounts separately.

11. Municipal Corporation of Delhi introduced a new method for payment of property tax under Unit Area Scheme w.e.f. 1st April, 2004. The Federation of Hotels and Restaurants Association of India (FHRAI) and the Company filed a writ petition in the High Court of Delhi against the said new method, which is still pending. However, in terms of the interim order dated 10th September, 2004 passed by the Honble High Court, the Company has been paying a sum of Rs. 54.52 Lakhs per annum based on the Ratable Value method then existing. However, as a matter of abundant caution, and based on the legal opinion obtained by the Company, the Company has provided for the difference in property tax as per Unit Area Scheme and the payments made since introduction of the said new method, alongwith interest thereon. Such calculations are based on usage factor of 10.

12. The Company has classified the various benefits provided to employees as under: -

(a) Defined contribution plans i) Provident fund

During the period, the Company has recognized the following amounts in the profit and loss account: Employers contribution to provident fund Rs. 527.52 Lakhs (prior year Rs. 272.33 Lakhs)

(b) Defined benefit plans

a) Contribution to Gratuity funds

b) Compensated absences - Earned leave

In accordance with Accounting Standard 15 (revised 2005), actuarial valuation was done in respect of the aforesaid defined benefit plans based on the following assumptions- Economic Assumptions The discount rate and salary increases assumed are the key financial assumptions and should be considered together; it is the difference or gap between these rates which is more important than the individual rates in isolation. Discount Rate

The discounting rate is based on the gross redemption yield on medium to long term risk free investments. The estimated term of the benefit obligations works out to 0 years. For the current valuation a discount rate of 8 % pa. compound, has been used in consultation with the employer.

Salary Escalation Rate

The salary escalation rate usually consists of at least three components, viz. Regular increments, price inflation and promotional increases. In addition to this any commitments by the management regarding future salary increases and the companys philosophy towards employee remuneration are also to be taken into account. Again a long-term view as to the trend in salary increase rates has to be taken rather than be guided by the escalation rates experienced in the immediate past, if they have been influenced by unusual factors. The assumptions used are summarised in the following table:

13. Related Party Disclosures

a) Parties which significantly influence the Company (either individually or with others)

(i) Yans Enterprises (H.K.) Ltd.

(ii) DSO Ltd.

(iii) Saraf Industries Ltd.

b) Parties which are significantly influenced by the Company (either individually or with others) (i) GJS Hotels Limited - a subsidiary company

(ii) Aria Hotels & Consultancy Services Private Limited - a subsidiary company

(iii) Chillwinds Hotels Limited - a subsidiary company

(iv) Vardhman Hotels Limited - a subsidiary company

(v) Regency Convention Centre & Hotels Ltd - a subsidiary company (an erstwhile associate company in the prior year)

14. (A) The Company has been exempted vide order no 46/91/2008-CL-l II dated 23rd May 2008 of Ministry of Corporate Affairs, Government of India under Section 211 (4) of the Companies Act, 1956 from disclosure of quantitative details of turnover, opening and closing stock, purchases, production and consumption of raw materials for the financial years ended March 31, 2008, March 31, 2009 and March 31, 2010.

15. During the prior year, the Company with an object to facilitate trifurcation under the Scheme had allotted 2 crores 1% Cumulative Redeemable Non Convertible Preference Shares (NCPS) of Rs 10/- each at a premium of Rs 80/- per share. As per the respective Subscription Agreement with Infrastructure Development Finance Company Limited (IDFC) and Magus Estate and Hotels Limited (Magus), a Company in which two of the directors are interested for subscription to the said preference shares, the Company is to redeem the said Preference Shares in three installments of 25%, 25% and 50% (including premiums) respectively as under:

Date of Redemption Amount of Redemption including Redemption Premium (Rs. in Lakhs) IDFC MAGUS (as per agreed revised terms)

June 30, 2008 3303.00 2250.00

June 30, 2009 2989.00 2250.00

June 30, 2010 4832.00 4500.00

During the period, 50% of such NCPS have already been redeemed. An amount of Rs. 17,458 Lakhs, out of the proceeds from the above said preference shares had been subscribed as equity in GJS Hotels Ltd, a subsidiary of the Company which is to be a part of the Kolkata undertaking in terms of the Scheme.

16. Subsequent to 30th September, 2009, the Company has received Rs. 3000 lakhs on October 14, 2009 and Rs.31100 Lakhs on October 16,2009 as subscription money against the Fully Convertible Preference Shares (FCPS) which are to be issued pursuant to the Scheme.

The Object of the aforesaid proposed issue on preferential allotment basis is to facilitate the trifurcation of the Company as envisaged in the Scheme. The above proceeds may be allocated, for the purposes of the utilisation, by the Board of Directors of the Company, to their undertakings as per their expansion/ financial plans or otherwise.

The FCPS shall be convertible, in one or more tranches, into equity shares of face value of Rs.10/- each of the respective companies, i.e. AHL Residual Company, Transferee Company-I or Transferee Company-ll, as the case may be, based on allocation of FCPS in terms of the Scheme.

17. In the prior year, Government of India had promulgated an Act namely The Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006) which came in to force with effect from October 2, 2006. The Company had sent letters to its suppliers for confirmations of their registration in MSMED Act, 2006 and on the basis of reply received from suppliers the disclosure is given below.

The Disclosure relating to Micro and Small Enterprises are as follows:

18. During the period, Term Loans taken by Aria Hotels and Consultancy Services Private Limited, a subsidiary company, from a financial institution and bank are secured by way of:-

(a) Mortgage by way of second pari passu charge created by the Company on its immovable property situated at Mumbai namely Hotel Hyatt Regency Mumbai.

(b) First pari passu charge created by the Company on credit card receivables of Hotel Hyatt Regency Mumbai.

(c) Pledge of Investment of the Company in Aria Hotels and Consultancy Services Private Limited, a subsidiary company.

(d) Personal Guarantees of the two of the directors of the Company.

19. The amount of foreign currency exposures that are not hedged by a derivative instruments or otherwise as on 30th September 2009 are as under:

20. The Company had obtained approval of the Registrar of Companies, NCT of Delhi & Haryana under Section 210 of the Companies Act, 1956, for extension of accounting year 2008-09. Accordingly, the current accounting period is for eighteen months from 1 st April, 2008 to 30th September, 2009 and hence the prior year figures are not comparable.

21. Prior year figures have been regrouped and rearranged wherever necessary. Schedules 1 to 21 form an integral part of the Balance Sheet as at 30th September, 2009 and Profit & Loss Account for the eighteen months period ended on that date.

 
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