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Notes to Accounts of Dhunseri Tea & Industries Ltd.

Mar 31, 2018

Notes to Financial Statements

ED FIRST TIME ADOPTION OF IND AS

Transition to Ind AS

These are the Company''s first financial statements prepared in accordance with Ind AS.

The accounting policies set out in Note 2, have been applied in preparing the financial statements for the year ended 31 March 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 1 April 2016 (the Company''s date of transition). In preparing its opening Ind AS balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following tables and notes.

A. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous

GAAP to Ind AS.

A.1 Ind AS optional exemptions

A. 1.1 Deemed cost

Ind AS 101 permits a first time adopter to elect to measure an item of property, plant and equipment at the date of transition to Ind AS at its fair value and use that fair value as its deemed cost at that date.

Accordingly, the Company has elected to measure certain class of property, plant and equipments at its fair value as at the transition date and considered such value as deemed cost at that date. While remaining class of assets are carried at historical cost determined in accordance with retrospective application of Ind AS.

A.1.2 Investments in subsidiaries

Ind AS 101 permits a first-time adopter to measure its investments in subsidiaries at deemed cost. The deemed cost of such an investment could be either (a) its fair value at the date of transition; or (b) previous GAAP carrying amount at that date. The option may be exercised individually and separately for each item of investment. Accordingly, the Company has opted to measure its investments in subsidiaries at deemed cost, i.e. previous GAAP carrying amount

A. 1.3 Past business combinations

Ind AS 101 permits a first-time adopter, not to apply Ind AS 103 retrospectively to past business combinations (business

combinations that occurred before the date of transition to Ind ASs).

Accordingly, the Company has opted to apply this exemption for past business combinations.

A.2 Ind AS mandatory exceptions

A. 2.1 Estimates

An entity''s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

Investment in equity instruments carried at FVOCI and investment in mutual funds as FVPL;

Biological asset measured at fair value less cost to sell.

A.2.2 Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the fact and circumstances that exists at the date of transition to Ind AS.

Note 41l FIRST TIME ADOPTION OF IND AS

B. Reconciliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

(1) Reconciliation of total equity Particulars

Notes

Amount as at at 31 March 2017

Amount as at 1 April 2016

Equity as per previous GAAP

62,302.63

45,090.20

Adjustments on transition to Ind AS

Impact on account of fair valuation of Property, plant and equipment

1

16,201.32

Impact on account of financial Instruments

2

1,026.89

(153.78)

Impact of recognising biological assets at fair values and movement thereon

3

46.15

44.99

Impact of measuring inventory of made tea on the basis of Ind AS 2 and Ind AS 41

4

(140.26)

(124.52)

Reversal of Proposed Dividend and Tax on Proposed Dividend

5

-

674.48

Replanting subsidy reclassified as deferred subsidy income

6

(58.29)

(59.36)

Other adjustments

7

14.97

-

Balance of equity as per Ind AS

before tax impact on adjustments

63,192.09

61,673.33

Deferred tax impact on the above

8

(2,959.14)

(3,024.86)

Balance of Equity as per Ind AS

60,232.95

58,648.47

(2) Reconciliation of total comprehensive income

Particulars

Notes

Year ended 31 March 2017

Net Profit after tax as per Previous GAAP

1,011.12

Re-measurements on transition to Ind AS

Impact on account of financial Instruments Reclassification of actuarial (gains) / losses of employee

2

23.66

benefit to other comprehensive income (OCI)

9

115.68

Impact of recognising biological assets at fair values and movement thereon

3

1.16

Impact of measuring inventory of made tea on the basis of Ind AS 2 and Ind AS 41

4

(15.74)

Replanting subsidy reclassified as deferred subsidy income

6

1.08

Other adjustments

7

14.97

Tax impact on above adjustments

8

28.89

Net Profit after tax as per Ind AS

1,180.82

Other comprehensive income/doss)

1,078.15

Total comprehensive income/doss) as per Ind AS

2,258.97

(3) Reconciliation of statement of cash flows :

Particulars

Notes

Amount as per Previous GAAP

Effect of transition to Ind AS

Amount as per Ind AS

Net cash generated from/(used in) operating activities

10,11

1,170.70

27.98

1,198.68

Net cash generated from/(used in) investing activities

10

(2,265.69)

(29.47)

(2,295.16)

Net cash generated from/(used in) financing activities

976.01

-

976.01

Net increase/(decrease) in cash and cash equivalents

(118.98)

(1.49)

(120.47)

Cash and cash equivalents as at 1 April 2016

11

262.46

(10.74)

251.72

Cash and cash equivalents as at 31 March 2017

11

143.48

(12.23)

131.25

Notes to reconciliation of total equity and total comprehensive income (1) Property, plant and equipment

(a) Under Ind AS, the Company has elected to measure certain class of property, plant and equipment at its fair value viz. freehold land, leasehold land and bearer plants as at the transition date and considered such value as deemed cost at that date. While remaining class of property, plant and equipment are carried at historical cost determined in accordance with retrospective application of Ind AS.

During the year 31 March 2017, the Company had applied revised Accounting standard 10 and recognised freehold land, leasehold land and bearer plants at fair value hence there is no impact on equity as at 31 March 2017.

(2) Financial Instruments

(a) In accordance with Ind AS 109 "Financial Instruments", investments in equity instruments (other than in subsidiaries, associates and joint ventures) and equity oriented mutual funds have been recognised at fair value at each reporting date through other comprehensive income.

Consequently, on eventual sale of such investments, profit or loss recognised in the statement of profit and loss under the Previous GAAP have been reversed as the fair value changes are recognised through other comprehensive income.

(b) In accordance with Ind AS 109 "Financial Instruments", investments in debt oriented/hybrid mutual funds are recognised at fair value through the statement of profit and loss at each reporting period.

(c) In accordance with Ind AS 109 "Financial Instruments", financial guarantee contracts are required to be recognised initially at fair value and subsequently at the higher of:

(i) the amount of the loss allowance

(ii) the amount initially recognised less, when appropriate, the cumulative amount of income recognised

(3) Impact of recognising biological assets at fair values and movement thereon

Under previous GAAP, biological assets were not required to be recognised. Under Ind AS, these have been recognised at fair value less costs to sell and change in fair value has been recognised in profit or loss.

(4) Impact of measuring inventory of made tea on the basis of Ind AS 2 and Ind AS 41

(a) Raw Materials: Under previous GAAP, no valuation was done for period end harvested tea-leaf. Under Ind AS, harvested leaf is measured at its fair value less cost to sell and is classified as Raw Materials.

(b) Fnished goods: Under previous GAAP, tea stock has been valued at the lower of cost and net realizable value. Cost of inventories comprise all costs of purchase/production of green leaf, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Under Ind AS, cost of inventories comprise cost of purchase of green leaf, fair value of green leaf at the time of harvest less cost to sell, conversion cost and other costs incurred in bringing the inventories to their present location and condition.

(5) Reversal of Proposed Dividend and Tax on Proposed Dividend

Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements and applicable dividend tax thereon were considered as adjusting events. Accordingly, provision for proposed dividend and dividend tax thereon was recognised as a liability. Under Ind AS, such dividend and tax thereon are recognised when the dividend is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and dividend tax thereon included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

(6) Replanting subsidy reclassified as deferred subsidy income

Under previous GAAP, replanting subsidy received from the Tea Board was recognized as revenue in the Statement of Profit and Loss as and when accrued. Under Ind AS, the same is recognized as deferred revenue in the Balance Sheet and transferred to profit or loss on a systematic and rational basis over the useful lives of the bearer plants.

(7) Other adjustments

Other adjustments primarily relate to capitalisation of finance cost on capital work-in-progress.

(8) Deferred tax

In accordance with Ind AS 12, "Income Taxes", the Company on transition to Ind AS has recognised deferred tax on temporary differences, i.e. based on balance sheet approach as compared to the earlier approach of recognising deferred taxes on timing differences, i.e. profit and loss approach.

Notes to reconciliation of total equity and total comprehensive income

(9) Reclassification of actuarial (gains) / losses of employee benefit to other comprehensive income (OCI)

(a) In accordance with Ind AS 19, "Employee Benefits" re-measurement gains and losses on post employment defined benefit plans are recognised in other comprehensive income as compared to the statement of profit and loss under the Previous GAAP.

(b) Interest expense/income on the net defined benefit liability/asset is recognised in the statement of profit and loss using the discount rate used for defined benefit obligation as compared to the expected rate used for recognising income from plan assets under the Previous GAAP.

(10) lmpact on account of government grant of capital nature

Under previous GAAP, government grant of capital nature were reduced from the value of property, plant and equipment and hence investing activities were shown net of such grants received. The same are now being treated as deferred income in accordance with Ind AS 20.

(11)Other bank balances

Under previous GAAP, other bank balances (comprising unpaid dividend), were considered as part of cash and cash equivalents. The same are not being included under Ind AS for consideration as cash and cash equivalents. The movement in balances is being considered under operating activities.

Note EH RESEARCH AND DEVELOPMENT

31 March 2018

31 March 2017

Research and Development Expenditure charged to revenue

19.79

16.67

Note 43 LEASE OBLIGATION

Operating Lease

The Company has taken various office premises, factory premises and residential accommodation for employees under operating cancellable lease arrangements having tenures ranging between 5 and 9 years. There is no specific obligation for renewal of these agreements.

Lease rent charged to the Statement of Profit and Loss

31 March 2018 134.69

31 March 2017 124.27

Out of a total of 12.98 hectares (31 March 2017 : 12.92 hectares, 01 April 2016 : 12.92 hectares) Freehold land under Investment Property as mentioned in Note 4 - Investment Properties, 6.25 hectares (31 March 2017 : 6.25 hectares, 01 April 2016 : 6.25 hectares) of land which was earlier declared as Private Forest land under the provisions of the Maharashtra Private Forest (Acquisition) Act 1975, has been mutated in the name of Dhunseri Petrochem & Tea Ltd (being the transferor company in the Scheme of Arrangement executed in the FY 2014-15) during the previous year. Pending completion of relevant formalities the same is yet to be transferred in the name of the Company.

Miscellaneous expenses (Refer Note 30) include a donation of Rs NIL (Previous Year Rs 25 lakh) for a political purpose to All India Trinamool Congress.

Disclosures relating to Specified Bank Notes* (SBNs) held and transacted during the period from 8 November 2016 to 30 December 2016

Particulars

SBNs*

Other Denomination Notes

Total

Closing Cash in Hand as on 08.11.16

17.11

7.32

24.43

( ) Permitted Receipts

-

509.63

509.63

(-) Permitted Payments

0.82

439.89

440.71

(-) Amount deposited in Banks

16.29

3.00

19.29

Closing cash in hand as on 30.12.16

-

74.06

74.06

* Specified Bank Notes (SBNs) mean the bank notes of denominations of the existing series of the value of five hundred rupees and one thousand rupees as defined under the notification of the Government of India, in the Minsitry of Finance, Department of Economic Affairs no. S.O. 3407(E), dated the November 8, 2016.

Pending completion of relevant formalities certain assets and liabilities acquired pursuant to the Scheme of Arrangement remain included in the books of the Company under the name of the transferor Company.

Note 48 PROPOSED DIVIDEND

Particulars

The final dividend proposed for the year is as follows :

31 March 2018

31 March 2017

01 April 2016

On Equity Shares of Rs 10 each

(i) Amount of dividend proposed for the year

560.40

560.40

560.40

(ii) Dividend per Equity Share (Rs)

8.00

8.00

8.00

(iii) Related Tax Impact (Rs)

115.19

114.08

114.08

The Board of Directors in its meeting on May 21, 2018 has proposed a final dividend of Rs 8/- per equity share for the financial year ended March 31, 2018. The proposal is subject to the approval of the shareholders at the Annual General Meeting and if approved would result in a cash outflow of Rs 675.59 Lakhs (including taxes).

For Lovelock & Lewes

For and on behalf of the Board of Directors

Firm Registration No. 301056E

C. K. Dhanuka

Basudeo Beriwala

Chartered Accountants

Managing Director

Director

Avijit Mukerji

(DIN -00005684)

(DIN -00118319)

Partner

Place : Kolkata

R. Mahadevan

Vikash Jain

P. C. Dhandhania

Membership No. 056155

Date : May 21, 2018

Company Secretary

Chief Financial Officer

Chief Executive Officer


Mar 31, 2017

CHANGE IN ACCOUNTING POLICY

As per Paragraph 32 of revised Accounting Standard (AS) 10 "Property, Plant and Equipment" effective from 01.04.2016, the Company has opted to adopt the Revaluation Model as prescribed therein for Land and Bearer Plants and the Cost Model for other class of assets. Accordingly Revaluation Reserves recognized in the previous years has been written back by Rs 19,431.42 lakhs and Rs 9,033.27 lakhs on account of Land and Bearer plants respectively and a fresh revaluation carried out as on 1.4.2016. wherein Rs 34,989.41 lakhs and Rs 9,676.59 lakhs has been added as revaluation reserve on account of Land and Bearer Plants (including Capital work-in-progress) respectively. Also as per the requirement of Revised Accounting Standard depreciation amounting to Rs 236.67 lakhs for the year ended 31st March 2017 on bearer plants has been provided.

Replantation expenditure amounting to Rs. 246.70 lakhs for the year ended 31st March 2017 which was hitherto charged to the Statement of Profit and Loss has been debited to Capital-Work in Progress during the year ended 31st March 2017.

Consequent to above replantation subsidy amounting to Rs 29.81 lakhs for the year ended 31st March 2017 which was hitherto credited to the Statement of Profit & Loss, has also been reduced from the carrying amount of the bearer plants.

As a result, profitfortheyearended 31st March 2017 is lower by Rs 19.78 lakhs.

1. DERIVATIVE INSTRUMENTS AND UNHEDGED FOREIGN CURRENCY EXPOSURES

Foreign Currency Exposure that are not hedged by a derivative instrument or otherwise -

Loan Taken Rs 1384.95 lakhs (Previous Year Rs 1326.66 lakhs) and interest accrued thereon Rs 5.19 lakhs (Previous Year Rs 3.28 lakhs). Loan Given Rs 178.29 lakhs (Previous Year Rs 191.77 lakhs).

Interest Receivable 9.34 lakhs (Previous Year Rs 25 lakhs).

2.LEASE OBLIGATION

Operating Lease

The Company has taken various office premises, factory premises and residential accommodation for employees under operating cancellable lease arrangements having tenures ranging between 5 and 9 years. There is no specific obligation for renewal of these agreements. Lease rent for the period amounts to Rs. 124.27 lakhs (Previous Year Rs 123.20 lakhs) debited to the Statement of Profit and Loss.

3. REVALUATION

Freehold Land, Leasehold Land and Bearer Plants are located at the ten tea estates of the Company were revalued on April 1, 2016 by Ernst & Young LLP, independent valuer on the bases as set out below:

Freehold Land and Leasehold Land- Market Method whereby the market rates are based on the available circle rates of the regions close to the tea estates of the Company after applying a discount rate for the large size of land, limited buyers, low frequency of transactions and restricted use.

Bearer Plant - Depreciated Replacement Cost Method whereby the replacement cost was calculated based on the Tea Board of India''s published rate of Unit Cost per hectare for replantation.

The resultant increase in Net Book Value of Rs. 34,989.41 lakhs for Land and Rs 9,676.59 lakhs for Bearer Plants has been credited to the Revaluation Reserve included under Reserves and Surplus (Note 3).

4. Out of a total of 12.92 hectares (Previous Year 12.92 Hectares) Freehold land under Investment Property as mentioned in Note 13 on Non-Current Investments, 6.25 Hectares (Previous Year 6.25 Hectares) of land which was earlier declared as Private Forest land under the provisions of the Maharashtra Private Forest (Acquisition) Act 1975, has been mutated in the name of Dhunseri Petrochem & Tea Ltd (being the transferor company in the Scheme of Arrangement executed in the FY 2014-15) during the year. Pending completion of relevant formalities the same is yet to be transferred in the name of the Company.

5. Miscellaneous expenses (Refer Note 29) include a donation of Rs 25 lakh (Previous Year Rs Nil) for a political purpose to All India Trinamool Congress and Rs Nil (Previous Year Rs 20 lakhs) to Assam Pradesh Congress Committee.

6. Disclosures relating to Specified Bank Notes* (SBNs) held and transacted during the period from 8th November 2016 to 30th December 2016

7. Pending completion of relevant formalities certain assets and liabilities acquired pursuant to the Scheme of Arrangement remain included in the books of the Company under the name of the transferor Company.

8. Previous period''s figures have been regrouped and rearranged wherever necessary.


Mar 31, 2016

(b) The Company has one class of equity share 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 the 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.

(d) During the year 2014-15, 7,004,951 Equity Shares of Rs. 10/-each were issued as fully paid up, issued pursuant to the Scheme of Arrangement without payment being received in cash.

Nature of Security

Loans repayable on demand from Banks are secured by a first hypothecation charge on the current assets of the Company, viz. stock of raw materials, stock-in-process, semi finished and finished goods, stores and spares not relating to plant and machinery, bills receivable, book debts and all other movables, both present and future, wherever situated. Secured by a first hypothecation charge on the movable fixed assets of the Company and equitable mortgage over the immovable properties by deposit of title deeds of tea estates.

a) All the 10 tea estates of Dhunseri Tea & Industries Limited (erstwhile Dhunseri Services Ltd.) have been transferred from Dhunseri Petrochem Ltd (formerly Dhunseri Petrochem & Tea Ltd), pursuant to a Scheme of Arrangement with effect from 1st April,2014(Refer Note No 41) and the grants/title deeds in respect thereof are yet to be transferred in the name of the Company. On the date of such transfer the title deeds/NLR grants, were still held in the name of the original owners. The details of which are in note (i) to (ii) below:-

i) Freehold Land represents two tea estates located at Assam, acquired through partnership with an HUF/ pursuant to a Scheme of Amalgamation.

ii) Leasehold Land excluding Estate Development of Rs. 10106.00 lakhs, represents eight tea estates, located at Assam, which were acquired pursuant to a Scheme of Amalgamation

iii) Building, includes [Gross Block and Net Block amounting to Rs. 206.18 lakhs (Previous Year 206.18 Lakhs) and Rs. 167.23 lakhs (Previous Year Rs. 170.48 Lakhs) respectively], two properties located at Kolkata for which, the conveyance deeds are yet to be executed and two properties (one located at Kolkata and one at Mumbai), which were acquired, pursuant to the Scheme of Arrangement referred to in Note (a) above, for which title deeds are yet to be transferred as at 31st March 2016.

(b) Gross Block and Accumulated Depreciation includes building on rented land amounting to ? 521.80 lakhs (Previous Year Rs. 521.80 lakhs) and Rs. 57.10 lakhs (Previous Year Rs. 48.83 lakhs) respectively.

(c) The Assam Government had acquired 84.54 hectares of Land under the Assam Fixation of Ceiling on Land Holdings Act, 1956. Pending the receipt of Land in exchange/finalization of compensation money from the authorities in respect of the above acquisition, the amount recognized in revaluation reserve in earlier year has been adjusted.

I. Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Trust Fund make payment to vested employees at retirement, death/disability, withdrawal of an amount based on the respective employee''s eligible salary for specified number of days depending upon the tenure of service subject to a maximum limit of Rs. 10 lakhs. Vesting occurs upon completion of five years of service. Liability with regard to the aforesaid gratuity plan is determined by actuarial valuation as set out in Note 1(g)(iii) above, based upon which the Company makes annual contributions for Gratuity to the Trust Fund.

(i) The estimate of future salary increase considered in actuarial valuation takes into account factors like inflation, seniority, promotion and other relevant factors. The expected return on plan assets is determined after taking into consideration composition of plan assets held, assessed risk, historical results on plan assets, the Company''s policy for plan asset management and other relevant factors.

(j) The Company provides for Superannuation benefit to certain employees wherein 15% of basic salary is funded with Life Insurance Corporation of India. Contribution during the year to such Fund amounts to Rs. 7.30 lakhs (Previous Year 6.32 lakhs) and has been recognized as an expense and included in Note 27- Employee benefits expenses under the head “Contribution to provident and other funds” in the Statement of Profit and Loss.

(k) The Company contributes 12% of the basic salary of Head Office employees towards Pension/Provident Fund Scheme to the Regional Provident Fund Commissioner West Bengal and 12% of the basic salary of garden staff/workers to Assam Tea Plantation Provident Fund account. Contribution during the year to such Funds amount to Rs. 425.95 lakhs (Previous Year Rs. 330.47 lakhs) and has been recognized as an expense and included in Note 27- Employee benefits expenses under the head “Contribution to provident and other funds” in the Statement of Profit and Loss.

Note : 1 [SEGMENT REPORTING

The Company is engaged in the integrated process of growing, harvesting and sale of loose and packet tea and operates in the domestic market. During the year it had also ventured into marketing of packaged Atta, however the same does not meet the criteria of Reportable Segment as specified under AS-17 of Segment Reporting.

Note: 2 IDEPRECIATION

The Company has changed its estimate regarding the estimated useful lives of certain fixed assets based on technical evaluation from 15 years to 3 years effective 1st April 2015. Pursuant to the said revision in useful lives for the year ended 31.3.2016 the depreciation expense is higher and profit before tax is lower by Rs. 23 lakhs.

Note : 38[DERIVATIVE INSTRUMENTS AND UNHEDGED FOREIGN CURRENCY EXPOSURES

Foreign Currency Exposure that are not hedged by a derivative instrument or otherwise -Loan Taken Rs. 1,326.66 lakhs (Previous Year Rs. 1267.97 lakhs)

Loan Given Rs. 191.77 lakhs (Previous Year Rs. 619.10 lakhs)

Interest Receivable Rs. 25 lakhs (Previous Year Rs. 40.06 lakhs)

Interest Payable Rs. 3.26 lakhs (Previous Year Rs.Nil)

Note : 4 LEASE OBLIGATION

Operating Lease

The Company has taken various office premises, factory premises and residential accommodation for employees under operating cancellable lease arrangements having tenures ranging between 5 and 9 years. There is no specific obligation for renewal of these agreements. Lease rent for the period amounts to Rs. 123.20 lakhs (Previous Year Rs. 133.45 lakhs) debited to the Statement of Profit and Loss.

Note: 5 [REVALUATION

Freehold Land and Leasehold Land & Estate Development located at the ten tea estates of the Company were revalued on April 1, 2014 by Ernst & Young LLP, independent valuer on the bases as set out below:

Freehold Land - Market Method

Leasehold Land & Estate Development (or Tea Plantation) - Combination of Market Method and Depreciated Replacement Cost Method.

The resultant increase in Net Book Value by Rs. 28837.99 lakhs, had been credited to the Revaluation Reserve included under Reserves and Surplus (Note 3).

Note : 6 SCHEME OF ARRANGEMENT

Pursuant to the Scheme of Arrangement (the Scheme), duly sanctioned by the Hon''ble High Court at Calcutta at the hearing held on 7th August, 2014, the Tea Division of Dhunseri Petrochem & Tea Limited (DPTL) engaged in the business of cultivation, production and marketing of tea, together with all its assets, liabilities etc. had been transferred as a going concern by way of demerger to the Company, with effect from the appointed date i.e. 1st April, 2014. Upon filing of the certified copy of the Court Order with the Registrar of Companies on 1st September 2014, the Scheme has become operative on and from the said date.

Accordingly the assets and liabilities of the Tea Division as recorded in the books of account of DPTL as on 1st April, 2014 with changes in values consequent to revaluation, as it was appearing in the books of DPTL, being ignored, amounting to Rs. 20,614.87 lakhs and Rs. 6,661.15 lakhs respectively have been recognized in the books of the Company.

As per the Scheme the Company in consideration of the demerger and transfer of the Tea Division from DPTL issued and allotted to the members of DPTL one equity share of Rs. 10 each in the Company, credited as fully paid up for every 5 equity shares of Rs. 10 each held by them in DPTL. Accordingly 7,004,951 equity shares were issued during the year ended 31st March 2015.

The difference between the assets and liabilities amounting to Rs.13,953.72 lakhs recorded above as reduced by the aggregate face value of shares amounting to Rs. 700.50 lakhs allotted by the Company was taken to General Reserve. (Refer Note 3)

Further in terms of the Scheme the Company''s 50,000 equity shares of Rs. 10 each fully paid up outstanding as at 1st April, 2014 were cancelled upon the issue of new equity shares to the shareholders of DPTL.

Note : 7

Freehold land included under Note 12, includes 6.25 Hectares (Previous Year 6.25 Hectares) of land declared as Private Forest under the provisions of the Maharashtra Private Forest (Acquisition) Act 1975, out of a total of 12.92 Hectares (Previous Year 12.92 Hectares)

Note : 8

Miscellaneous expenses (Refer Note 29) include a donation of Rs.20 lakh (Previous Year Nil) for a political purpose to Assam Pradesh Congress Committee.

Note : 9

Pending completion of relevant formalities certain assets and liabilities acquired pursuant to the Scheme of Arrangement remain included in the books of the Company under the name of the transferor Company.

Note : 10

Previous period''s figures have been regrouped and rearranged wherever necessary.


Mar 31, 2015

(A) The Company has one class of equity share 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 the 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.

Nature of Security

i Term Loan from Banks amounting to H400 lakhs (Previous Year Nil) is secured by way of first pari-passu charge on certain Fixed Assets of the Company (including Capital work in progress & equitable mortgage on the tea estates) along with the working capital bankers and further by any other security as may be stipulated by the Bank.

Terms of Repayment

Repayable in 19 Quarterly installments commencing from second quarter of the year ended 31.03.2012.

Term Loans (Auto Loans) from bank and other parties amounting to H35.38 lakhs (Previous Year Nil) are secured by hypothecation of respective vehicles.

Equated Monthly Installments beginning from the month subsequent to taking of the Loans.

(c) Figures indicated in (a) to (b) above includes current maturities of respective borrowings which have been presented in Note 10.

Nature of Security

Loans repayable on demand from Banks are secured by a first hypothecation charge on the current assets of the Company, viz. stock of raw materials, stock-in-process, semi finished and finished goods, stores and spares not relating to plant and machinery, bills receivable, book debts and all other movables, both present and future, wherever situated. Secured by a first hypothecation charge on the movable fixed assets of the Company and equitable mortgage over the immovable properties by deposit of title deeds of tea estates.

(a) Based on the information available with the Company there are no amounts payable under Micro, Small and Medium Enterprise Development Act, 2006.

(a) There are no amounts due for payment to the Investor Education and Protection Fund under Section 205C of the Companies Act, 1956.

Note 2 EMPLOYEE BENEFIT OBLIGATIONS Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Trust Fund make payment to vested employees at retirement, death/disability, withdrawal of an amount based on the respective employee's eligible salary for specified number of days depending upon the tenure of service subject to a maximum limit of H10 lakhs. Vesting occurs upon completion of five years of service. Liability with regard to the aforesaid gratuity plan is determined by actuarial valuation as set out in Note 1(g)(ii) above, based upon which the Company makes annual contributions for Gratuity to the Trust Fund.

(i) The estimate of future salary increase considered in actuarial valuation takes into account factors like inflation, seniority, promotion and other relevant factors. The expected return on plan assets is determined after taking into consideration composition of plan assets held, assessed risk,historical results on plan assets, the Company's policy for plan asset management and other relevant factors.

(j) Contribution for Defined Contribution Plan comprising H6.32 lakhs (Previous Year Nil) on account of the Company's contribution to Superannuation Fund and H318.40 lakhs (Previous Year Nil) on account of the Company's contribution to Provident funds has been recognised as an expense and included in Note 27 - Employee benefits expenses under the head "Contribution to provident and other funds" in the Statement of Profit and Loss.

Note 3 DISCLOSURE OF RELATED PARTIES AND RELATED PARTY TRANSACTIONS IN KEEPING WITH ACCOUNTING STANDARD 18

Names of related parties and description of relationship:

Where control exists

(A) Subsidiary Company:

(1) Dhunseri Petrochem & Tea Pte Ltd.

(B) Subsidiaries of Dhunseri Petrochem & Tea Pte Ltd.

(2) Makandi Tea & Coffee Estates Ltd.

(3) Kawalazi Estate Company Ltd.

Others

(C) Group Companies (i.e. Companies in which Key Management Personnel is able to exercise significant influence):

(4) Naga Dhunseri Group Limited

(5) Trimplex Investments Limited

(6) Mint Investments Limited

(7) Dhunseri Investments Limited

(8) Dhunseri Petrochem Limited

(D) Key Management Personnel

(9) Mr. C.K.Dhanuka

(E) Relative of Key Management Personnel

(10) Mr Mrigank Dhanuka

Note 4 SEGMENT REPORTING

The Company is engaged in the integrated process of growing, harvesting and sale of tea and operates in the domestic market. Accordingly the Company is a single segment in accordance with Accounting Standard.

Note 5 DEPRECIATION

Depreciation for the year amounting to Rs.612.36 lakhs (Previous Year Nil) includes a one time charge of Rs.85.76 lakhs (Previous Year Nil) on account of Net Depreciable value of assets whose useful remaining lives were Nil as on 1st April, 2014 consequent to the decision of the Company to adopt the useful lives specified in Schedule II to the Companies Act, 2013 with effect from that date.

Note 6 DERIVATIVE INSTRUMENTS AND UNHEDGED FOREIGN CURRENCY EXPOSURES

Foreign Currency Exposure that are not hedged by a derivative instrument or otherwise - Loan Taken Rs.1,267.97 lakhs (Previous Year Nil)

Loan Given Rs.619.10 lakhs (Previous Year Nil)

Interest Receivable Rs.40.06 lakhs (Previous Year Nil)

Note 7 LEASE OBLIGATION Operating Lease

The Company has taken various office premises, factory premises and residential accommodation for employees under operating cancellable lease arrangements having tenures ranging between 5 and 9 years. There is no specific obligation for renewal of these agreements. Lease rent for the period amounts to Rs.133.45 lacs (Previous Year Nil) debited to the Statement of Profit and Loss.

Note 8 REVALUATION

Freehold Land and Leasehold Land & Estate Development located at the ten tea estates of the Company have been revalued on April 1, 2014 by Ernst & Young LLP, independent valuer on the bases as set out below:

Freehold Land-Market Method

Leasehold Land & Estate Development (Tea Plantation) - Combination of Market Method and Depreciated Replacement Cost Method. The resultant increase in Net Book Value by H28837.99 lakhs, has been credited to the Revaluation Reserve included under Reserves ans Surplus (Note 3).

Note 9 SCHEME OF ARRANGEMENT

Pursuant to the Scheme of Arrangement (the Scheme), duly sanctioned by the Hon'ble High Court at Calcutta at the hearing held on 7th August, 2014, the Tea Division of Dhunseri Petrochem & Tea Limited (DPTL) engaged in the business of cultivation, production and marketing of tea, together with all its assets, liabilities etc. has been transferred as a going concern by way of demerger to the Company, with effect from the appointed date i.e. 1st April, 2014. Upon filing of the certified copy of the Court Order with the Registrar of Companies on 1st September 2014, the Scheme has become operative on and from the said date.

Accordingly the assets and liabilities of the Tea Division as recorded in the books of account of DPTL as on 1st April, 2014 with changes in values consequent to revaluation, as it was appearing in the books of DPTL, being ignored, amounting to Rs.20,614.87 lakhs and Rs.6,661.15 lakhs respectively have been recognized in the books of the Company.

As per the Scheme the Company in consideration of the demerger and transfer of the Tea Division from DPTL issued and allotted to the members of DPTL one equity share of Rs.10 each in the Company, credited as fully paid up for every 5 equity shares of H10 each held by them in DPTL. Accordingly 7,004,951 equity shares have been issued during the year.

The difference between the assets and liabilities amounting to Rs.13,953.72 lakhs recorded above as reduced by the aggregate face value of shares amounting to Rs.700.50 lakhs allotted by the Company was taken to General Reserve. (Refer Note 3)

Further in terms of the Scheme the Company's 50,000 equity shares of H10 each fully paid up outstanding as at 1st April, 2014 were cancelled upon the issue of new equity shares to the shareholders of DPTL.

Note 10

Pending completion of relevant formalities, certain assets and liabilities acquired pursuant to the Scheme of Arrangement as referred to in Note 41, remain included in the books of the Company under the name of the Transferor Company

Note 11

Freehold Land included under Note 13 includes 6.25 Hectares of land declared as Private Forest under the provisions of the Maharashtra Private Forest (Acquisition) Act, 1975,out of a total of 12.92 Hectares (Previous Year Nil)

Note 12

Previous Year figures have been regrouped and rearranged wherever necessary.

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 The Notes referred to above form an integral part of the Cash Flow Statement.

3 Previous year's figures have been regrouped/rearranged wherever necessary.

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