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Notes to Accounts of Goodyear India Ltd.

Dec 31, 2014

(1) GENERAL INFORMATION

Goodyear India Limited (the "Company"), an existing company under the Companies Act,1956, is a step-down subsidiary of The Goodyear Tire & Rubber Company, Akron, Ohio, USA ("GTRC"). The Company was originally registered and incorporated as a private company on October 10, 1922 and converted into a public company on March 24,1961. The Company is engaged in the business of manufacturing and trading of tyres, tubes and flaps with manufacturing facility at Ballabgarh, Haryana, India. The Company is presently listed with the Mumbai stock exchange (BSE Limited).

(2) Contingent Liabilities

i) Guarantee to Sarva Haryana Gramin Bank 102 133

ii) Other moneys for which Company is 474 474 contingently liable Price Differential pending settlement

iii) Claims against the Company disputed and not acknowledged as debts**

A. Excise duty and Service tax matters

a) Cases decided in the Company''s favour by Appellate authorities and for which 484 484 Department has filed further appeal.

b) Cases pending before Appellate authorities in respect of which the Company has filed 1,570 1,241 appeals.Amounts deposited under protest Rs. 386 (Rs. 386).

B. Income tax matters

Cases pending before Appellate authorities /Dispute Resolution Panel in respect 3,365 1,932 of which the Company has filed appeals. Amounts deposited under protest Rs. 271 (Rs. 133).

C. Sales tax matters

Cases pending before Appellate authorities in respect of which the Company has filed 383 663 appeals. Amounts deposited under protest Rs. 142 (Rs. 284).

D. Haryana Urban Development Authority - 662 (HUDA) demand matter *

Demand for proportionate external development charges by HUDA.

E. Other matters

These include claims against the Company for recovery lodged by various parties. 294 266



* During the year 2003, a demand of Rs. 662 lakhs besides interest, was raised by the Haryana Urban Development Authority (HUDA) towards external development charges (EDC) which was challenged by the Company. During June 2009, the Court of Hon''ble Additional Civil Judge (Senior Division) (First Court) passed an interim order whereby the Company was directed to pay interest @ 10% for delayed payment amounting to Rs. 5 lakhs and which was duly paid. In the year 2010, the entire demand had been set aside by the First Court. However, HUDA challenged the same before the Court of Hon''ble District & Session Judge, Faridabad. In December 2011, the said appeal was dismissed by Hon''ble District and Session Judge. HUDA has further gone into appeal before the Hon''ble High Court of Punjab and Haryana. The matter was heard by Hon''ble High Court and as per order dated May 27, 2014 the Appeal filed by HUDA has been dismissed. The Company has also not received any information of Huda filing any further appeal before the Supreme Court.

(3) Haryana Local Area Development Tax (HLADT)

In the year 2007, Hon''ble Punjab & Haryana High Court at Chandigarh, on a reference from the Hon''ble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008, the State of Haryana introduced "Haryana Tax on Entry of Goods Into Local Area Act, 2008 (Entry Tax)" by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Hon''ble Punjab & Haryana High Court.

Earlier based on the legal opinion obtained by the Company and management''s assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lakhs was written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs.1,938 lakhs.

Pursuant to an interim order of Hon''ble Supreme Court in October 2009, there is a stay on recovery of tax with a direction to assessees for filing their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by the Court. During the year 2010, on the matter being heard by a bench of five Hon''ble judges of the Hon''ble Supreme Court, it was requested to Hon''ble Chief Justice of India to refer the matter to a suitable larger bench for deciding the constitutional validity of the levy. The larger bench of Hon''ble Supreme Court is yet to be constituted. However, based on legal opinion obtained by the Company and management''s assessment, no provision for HLADT and Entry tax has been considered necessary.

** These represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes.

(4) The Company''s business activity falls within a single primary business segment viz. ''Automotive tyres, tubes and flaps''. Secondary segment reporting is based on the geographical location of the customers. Details of secondary segments are not disclosed as more than 90% of the Company''s revenues, results and assets relate to the domestic market. Therefore, no further disclosure is considered as required under Accounting Standard (AS-17) "Segment Reporting".

(5) Disclosures under Accounting Standard 18:

i) List of related parties with whom the Company had transactions during the year :

Ultimate holding company :

The Goodyear Tire & Rubber Company, Akron, Ohio, USA

* Holding company until November 28, 2011 Ultimate holding company since November 29, 2011

Holding company :

Goodyear Orient Company (Private) Limited, Singapore (Holding company since November 29, 2011)

Fellow subsidiaries:

i) Goodyear SA (Luxembourg)

ii) Goodyear Middle East, FZE

iii) Goodyear Dalian Tire Company Limited

iv) Goodyear Dunlop Tires France

v) Goodyear (Thailand) Public Company Limited

vi) Goodyear do Brasil Produtos de Borracha Ltda.

vii) PT. Goodyear Indonesia Tbk

viii) Goodyear South Africa (Pty.) Limited

ix) Goodyear Singapore Tyres

x) Goodyear & Dunlop Tyres (NZ) Limited

xi) Goodyear Marketing & Sales SDN Bhd

xii) TC Debica SA

xiii) Goodyear & Dunlop Tyres (Australia) Pty Limited

xiv) Goodyear South Asia Tyres Private Limited

xv) Goodyear Earthmover Pty Limited

xvi) Goodyear International Corporation

xvii) Goodyear Dunlop Tires Operations SA

xviii) Compania Goodyear Del Peru SA

xix) Goodyear SA R&D (Luxembourg)

xx) Goodyear Dunlop Tires Germany

xxi) GRBS Inc., Philippines

xxii) Nippon Giant Tire Co. Ltd.

xxiii) Goodyear Philippines Inc.

Key management personnel:

i) Mr. Rajeev Anand

ii) Mr. Yashwant Singh Yadav

iii) Mr. Mark C Ravunni

(6) Leases

Cancellable : The Company''s cancellable operating lease arrangement mainly consists of residential premises, warehouses and offices taken on lease for periods between 1-10 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

(7) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arm''s length basis at duly negotiated prices on usual commercial terms. The Company has submitted the Accountant''s Report in form 3CEB upto the financial year ended on March 31, 2014 as required under section 92E of the Income Tax Act, 1961. In respect of the proposed transfer pricing adjustments suggested by the Assessing Officers in the Assessments already completed, the matters are pending before the Appellate Authorities/Dispute Resolution Panel. Based on expert opinion, the management is of the view that in all likelihood there will be not material liability.

(8) Disclosures under the Micro, Small and Medium Enterprises Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007) based on the information available with the Company :

i) Principal amount due to suppliers registered under the MSMED Act and remaining unpaid as at year end -Rs. NIL (Rs. NIL)

ii) Interest due to suppliers registered under the MSMED Act and remaining unpaid as at year end -Rs. NIL (Rs. NIL)

iii) Principal amounts paid to suppliers registered under the MSMED Act, beyond the appointed day during the year -Rs. NIL (Rs. NIL)

iv) Interest paid, other than under Section 16 of MSMED Act, to suppliers registered under the MSMED Act, beyond the appointed day during the year -Rs. NIL (Rs. NIL)

v) Interest paid, under Section 16 of MSMED Act, to suppliers registered under the MSMED Act, beyond the appointed day during the year -Rs. NIL (Rs. NIL)

vi) Interest due and payable towards suppliers registered under MSMED Act, for payments already made -Rs. NIL (Rs. NIL)

vii) Further interest remaining due and payable for earlier years -Rs. NIL (Rs. NIL)

(9) In accordance with AS-15 (revised) "Employee Benefits", the Company has calculated the various benefits provided to employees as under :

A. Defined Contribution Plans

a) Superannuation Fund

b) Employee''s State Insurance (State Plan)

c) Employee''s Pension Scheme 1995 (State plan)

(10) The Goodyear Tire & Rubber Company, Akron, Ohio, USA (Ultimate holding company) has various ''non - qualified stock appreciation rights plan'' (SARs) whereby certain employees of its subsidiaries are granted cash-settled SARs. These SARs entitles the holder to receive cash payout equivalent to the fair market value of the underlying shares on the date of exercise as reduced by the designated exercise price of SARs. The eligible employees do not receive / own shares directly / as a beneficiary at any point of time under the SARs. The said SARs generally have a graded vesting period of four years. Once a SAR vests, an employee can exercise it at any time prior to its expiration. The cost related to these SARs exercised by the employees of Goodyear India Limited (''Company'') is accounted for in the books of the Company. Accordingly, a sum of Rs. 28 lakhs (Rs. 72 lakhs) has been included under Employee Benefits Expense (Refer note ''27'').

(11) Stock and book debts are subject to a maximum charge of Rs. 3,500 lakhs (Rs. 3,500 lakhs) for all credit facilities/guarantees sanctioned by BNP Paribas Bank.

(12) Previous year figures have been regrouped and recasted, wherever necessary, to conform to the current year''s classification.


Dec 31, 2013

(1) GENERAL INFORMATION

Goodyear India Limited (the "Company"), an existing company under the Companies Act,1956, is a step-down subsidiary of The Goodyear Tire & Rubber Company, Akron, Ohio, USA ("GTRC"). The Company was originally registered and incorporated as a private company on October 10, 1922 and converted into a public company on March 24,1961. The Company is engaged in the business of manufacturing and trading of tyres, tubes and faps with manufacturing facility at Ballabgarh, Haryana, India. The Company is presently listed with the Mumbai stock exchange (BSE Limited).

Contingent Liabilities : Contingent liabilities are disclosed when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources will be required to settle or a reliable estimate of the amount cannot be made.

As at As at Dec 31, 2013 Dec 31, 2012 (Rs.'' lakhs) (Rs.'' lakhs)

(2) Contingent liabilities :

i) Guarantee to Gurgaon Gramin Bank 133 126

ii) Other moneys for which Company is contingently liable Price Differential pending settlement 474 474

iii) Claims against the Company disputed and not acknowledged as debts **

A. Excise duty and Service tax matters

a) Cases decided in the Company''s favor by Appellate authorities and for which 484 484 Department has fled further appeal.

b) Cases pending before Appellate authorities in respect of which the Company has fled 1,241 1,152 appeals. Amounts deposited under protest Rs. 386 (Rs. 376).

B. Income tax matters

Cases pending before Appellate authorities/Dispute Resolution Panel in respect of which 1,932 1,295 the Company has fled appeals. Amounts deposited under protest Rs. 133 (Rs. 63).

C. Sales tax matters

Cases pending before Appellate authorities in respect of which the Company has fled 663 676 appeals. Amounts deposited under protest Rs. 284 (Rs. 250).

D. Haryana Urban Development Authority (HUDA) demand matter * 662 662 Demand for proportionate external development charges by HUDA.

E. Other matters 266 909

These include claims against the Company for recovery lodged by various parties. Amounts deposited under protest Rs. Nil (Rs. 443).

* During the year 2003, a demand of Rs. 662 lakhs besides interest, was raised by the Haryana Urban Development Authority

(HUDA) towards external development charges (EDC) which was challenged by the Company. During June 2009, the Court of Hon''ble Additional Civil Judge (Senior Division) (First Court) passed an interim order whereby the Company was directed to pay interest @ 10% for delayed payment amounting to Rs. 5 lakhs and which was duly paid. In the year 2010, the entire demand had been set aside by the First Court. However, HUDA challenged the same before the Court of Hon''ble District & Session Judge, Faridabad. In December 2011, the said appeal was dismissed by Hon''ble District and Session Judge. HUDA has further gone into appeal before the Hon''ble High Court of Punjab and Haryana, to our knowledge the same has not yet been admitted.

F. Haryana Local Area Development Tax (HLADT)

In the year 2007, Hon''ble Punjab & Haryana High Court at Chandigarh, on a reference from the Hon''ble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008, the State of Haryana introduced "Haryana Tax on Entry of Goods Into Local Area Act, 2008 (Entry Tax)" by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Hon''ble Punjab & Haryana High Court.

Earlier based on the legal opinion obtained by the Company and management''s assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lakhs was written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs.1,938 lakhs.

Pursuant to an interim order of Hon''ble Supreme Court in October 2009, there is a stay on recovery of tax with a direction to assessees for fling their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by the Court. During the year 2010, on the matter being heard by a bench of fve Hon''ble judges of the Hon''ble Supreme Court, it was requested to Hon''ble Chief Justice of India to refer the matter to a suitable larger bench for deciding the constitutional validity of the levy. The larger bench of Hon''ble Supreme Court is yet to be constituted. However, based on legal opinion obtained by the Company and management''s assessment, no provision for HLADT and Entry tax has been considered necessary.

(3) The Company''s business activity falls within a single primary business segment viz. ''Automotive tyres, tubes and faps''. Secondary segment reporting is based on the geographical location of the customers. Details of secondary segments are not disclosed as more than 90% of the Company''s revenues, results and assets relate to the domestic market. Therefore, no further disclosure is considered as required under Accounting Standard (AS-17) "Segment Reporting".

(4) Disclosures under Accounting Standard 18 :

i) List of related parties with whom the Company had transactions during the year : Ultimate Holding Company :

The Goodyear Tire & Rubber Company, Akron, Ohio, USA

Holding Company :

Goodyear Orient Company (Private) Limited, Singapore (Holding company since November 29, 2011)

Fellow Subsidiaries :

i) Goodyear SA (Luxembourg)

ii) Goodyear Middle East, FZE

iii) Goodyear Dalian Tire Company Limited

iv) Goodyear Dunlop Tires France

v) Goodyear (Thailand) Public Company Limited

vi) Goodyear do Brasil Products de Borracha Ltda

vii) Goodyear De Colombia S.A

viii) PT. Goodyear Indonesia Tbk

ix) Goodyear South Africa (Pty.) Limited

x) Goodyear Singapore Tyres

xi) Goodyear & Dunlop Tyres (NZ) Limited

xii) Goodyear Marketing & Sales SDN Bhd

xiii) TC Debica SA

xiv) Goodyear & Dunlop Tyres (Australia) Pty Limited

xv) Goodyear South Asia Tyres Private Limited

xvi) Goodyear Earthmover Pty Limited

xvii) Goodyear International Corporation

xviii) Goodyear Dunlop Tires Operations SA

xix) Compania Goodyear Del Peru SA

xx) Goodyear SA R&D (Luxembourg)

xxi) Goodyear Dunlop Tires Germany

xxii) GRBS Inc., Philippines

Key management personnel :

i) Mr Rajeev Anand

ii) Mr Yashwant Singh Yadav

iii) Mr Mark C Ravunni

(5) Leases

Cancellable : The Company''s cancellable operating lease arrangement mainly consists of residential premises, warehouses and offices taken on lease for periods between 1-10 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

(6) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arm''s length basis at duly negotiated prices on usual commercial terms. The Company has submitted the Accountant''s Report in form 3CEB up to the financial year ended on March 31, 2013 as required under section 92E of the Income Tax Act, 1961. In respect of the proposed transfer pricing adjustments suggested by the Assessing Officers in the Assessments already completed, the matters are pending before the Appellate Authorities/Dispute Resolution Panel. Based on expert opinion, the management is of the view that in all likelihood there will be no material liability.

(7) Disclosures under the Micro, Small and Medium Enterprises Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007) based on the information available with the Company :

i) Delayed payments due as at the end of accounting year on account of principal - Rs. Nil (Rs. Nil) and Interest due thereon - Rs. Nil (Rs. Nil)

ii) Total interest paid on all delayed payments during the year under the provisions of the Act - Rs. Nil (Rs. Nil)

iii) Interest due on principal amounts paid beyond the due date during the year but without the interest amounts under this Act - Rs. Nil (Rs. Nil)

iv) Interest accrued but not due - Rs. Nil (Rs. Nil)

v) Total interest due but not paid - Rs. Nil (Rs. Nil)

(8) In accordance with AS-15 (revised) "Employee Benefits", the Company has calculated the various benefits provided to employees as under :

A. Defend Contribution Plans

a) Superannuation Fund

b) Employee''s State Insurance (State Plan)

c) Employee''s Pension Scheme 1995 (State plan)

(9) The Goodyear Tire & Rubber Company, Akron, Ohio, USA (Ultimate holding company) has various ''non - qualified stock appreciation rights plan'' (SARs) whereby certain employees of its subsidiaries are granted cash-settled SARs. These SARs entitles the holder to receive cash payout equivalent to the fair market value of the underlying shares on the date of exercise as reduced by the designated exercise price of SARs. The eligible employees do not receive / own shares directly / as a beneficiary at any point of time under the SARs. The said SARs generally have a graded vesting period of four years. Once a SAR vests, an employee can exercise it at any time prior to its expiration. The cost related to these SARs exercised by the employees of Goodyear India Limited (''Company'') is accounted for in the books of the Company. Accordingly, a sum of Rs. 72 lakhs (Rs. Nil) has been included under Employee Benefits Expense (Refer note ''27'').

(10) Stock and book debts are subject to a maximum charge of Rs. 3,500 lakhs (Rs. 3,500 lakhs) for all credit facilities/guarantees sanctioned by BNP Paribas Bank.

(11) Previous year figures have been regrouped and recanted, wherever necessary, to conform to the current year''s classification.


Dec 31, 2012

(1) GENERAL INFORMATION

Goodyear India Limited (the "Company"), an existing company under the Companies Act - 1956, is a step down subsidiary of The Goodyear Tire & Rubber Company, Akron, Ohio, USA ("GTRC"). The Company was originally registered and incorporated as a private company on October 10, 1922 and converted into a Public Company on March 24, 1961. The Company is engaged in the business of manufacturing and sale of tyres, tubes, flaps with manufacturing facility at Ballabgarh, Haryana, India. The Company is presently listed with the Mumbai stock exchange (BSE Limited).

* During the year 2003, a demand of Rs. 662 lakhs besides interest, was raised by the Haryana Urban Development Authority (HUDA) towards external development charges (EDC) which was challenged by the Company. During June 2009, the court of Hon''ble Additional Civil Judge (Senior Division) (First Court) passed an interim order whereby the Company was directed to pay interest @ 10% for delayed payment amounting to Rs. 5 lakhs and which was duly paid. In the year 2010 the entire demand had been set aside by the First Court. However, HUDA challenged the same before the Court of Hon''ble District & Session Judge, Faridabad. In December 2011 the said appeal was dismissed by Hon''ble District and Session Judge. HUDA has further gone into appeal before the Hon''ble High Court of Punjab and Haryana, to our knowledge the same has not yet been admitted.

A. Haryana Local Area Development Tax (HLADT)

In the year 2007 Hon''ble Punjab & Haryana High Court at Chandigarh, on a reference from the Hon''ble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008 the state of Haryana introduced "Haryana Tax on Entry of Goods Into Local Area Act, 2008 (Entry Tax) by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Hon''ble Punjab & Haryana High Court.

Earlier based on the legal opinion obtained by the Company and management''s assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lakhs was written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs.1,938 lakhs.

Pursuant to an interim order of Hon''ble Supreme Court in October 2009, there is a stay on recovery of tax with a direction to assessees for filing their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by the court. During the year 2010 on the matter being heard by a bench of five Hon''ble judges of the Hon''ble Supreme Court, it was requested to Hon''ble Chief Justice of India to refer the matter to a suitable larger bench for deciding the constitutional validity of the levy The larger bench of Hon''ble Supreme Court is yet to be constituted. However, based on legal opinion obtained by the Company and management assessment, no provision for HLADT and Entry tax has been considered necessary

** These represent the best possible estimates arrived at on the basis of available information. The uncertainties and possible reimbursements are dependent on the outcome of the different legal processes which have been invoked by the Company or the claimants as the case may be and therefore cannot be predicted accurately. The Company engages reputed professional advisors to protect its interests and has been advised that it has strong legal positions against such disputes.

(2) Disclosures under Accounting Standard 18:

i) List of related parties with whom the Company had transactions during the year. Ultimate holding company :

The Goodyear Tire & Rubber Co., Akron, Ohio, USA. (since November 29, 2011) Holding company:

The Goodyear Tire & Rubber Co., Akron, Ohio, USA. (until November 28, 2011) Goodyear Orient Company (Private) Ltd., Singapore (since November 29, 2011)

Fellow subsidiaries:

i) Goodyear SA (Luxembourg)

ii) Goodyear Middle East, FZE

iii) Goodyear Dalian Tire Company Limited

iv) Goodyear Dunlop Tires France

v) Goodyear (Thailand) Public Company Limited

vi) Goodyear do Brasil Produtos de Borracha Ltda.

vii) Goodyear De Colombia S.A

viii) PT. Goodyear Indonesia Tbk

ix) Goodyear South Africa (Pty.) Limited

x) Goodyear Philippines Inc.

xi) Goodyear Singapore Tyres

xii) Goodyear & Dunlop Tyres (NZ) Limited.

xiii) Goodyear Marketing & Sales SDN Bhd

xiv) TC Debica SA

xv) Goodyear & Dunlop Tyres (Australia) Pty Limited.

xvi) Goodyear South Asia Tyres Private Limited

xvii) Goodyear Earthmover Pty Limited.

xviii) Goodyear International Corporation

xix) Goodyear Dunlop Tires Operations SA

xx) Compania Goodyear Del Peru SA

xxi) Goodyear Nippon Giant (Japan NGT)

xxii) Goodyear SA R&D (Luxembourg)

xxiii) Goodyear Chile S.A.I.C

xxiv) Goodyear Dunlop Tires Germany

Key management personnel:

i) Mr. Rajeev Anand

ii) Mr. Yashwant Singh Yadav

iii) Mr. Mark C Ravunni (Effective July 16, 2012)

iv) Mr. Jean Philippe Lecerf (upto July 15, 2012)

(3)Leases

Cancellable : The Company''s cancellable operating lease arrangement mainly consists of residential premises, warehouses and offices taken on lease for periods between 1-10 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

(4) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arms'' length basis at duly negotiated prices on usual commercial terms. The Company has submitted the Accountant''s Report in form 3CEB upto the financial year ended on March 31, 2012 as required under section 92E of the Income Tax Act, 1961. In respect of the proposed transfer pricing adjustments suggested by the Assessing Officers in the Assessments already completed, the matters are pending before the Appelllate Authorities / Dispute Resolution Panel. Based on expert opinion the management is of the view that in all likelihood there will be no material liability.

(5) Disclosures under the Micro, Small & Medium Enterprise Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007) based on the information available with the company:

i) Delayed payments due as at the end of accounting year on account of Principal - Rs. Nil (Nil) and Interest due thereon - Rs. Nil (Nil)

ii) Total interest paid on all delayed payments during the year under the provisions of the Act - Rs. Nil (Nil)

iii) Interest due on principal amounts paid beyond the due date during the year but without the interest amounts under this Act - Rs. Nil (Nil)

iv) Interest accrued but not due- Rs. Nil (Nil)

v) Total Interest Due but not paid - Rs. Nil (Nil)

(6)In accordance with AS-15 (revised) "Employee Benefits", the Company has calculated the various benefits provided to employees as under:

A. Defined Contribution Plans

a) Superannuation Fund

b) Employer''s Contribution to Employee state insurance (State Plan)

c) Employer''s contribution to Employee''s Pension Scheme 1995. * (State plan)

(7) Stock and book debts are subject to a maximum charge of Rs.3,500 lakhs (Rs. 3,500 lakhs) for all credit facilities / guarantees sanctioned by BNP Paribas Bank.

(8) In the Board Meeting held on Feb. 21, 2011, the Board considered and approved the sale of a part of land located in Ballabgarh, subject to obtaining of necessary approvals for such sale. In the absence of said approvals, pursuant to a circular resolution passed by the Board of Directors on June 21, 2012, the Board considered and terminated the process of sale. During October, 2012 the Company has appropriately dealt with and replied to a notice received for a full refund of deposit along with interest and damages. There has not been any development thereafter.

(9) The financial statements for the year ended December 31, 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended December 31, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been regrouped and reclassified to conform to this year''s classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements. Figures in brackets, wherever given are in respect of previous year unless stated otherwise.


Dec 31, 2011

(a) Contingent liabilities*

As at As at December 31, December 31, 2011 2010 (Rs.'000) (Rs.'000)

i) Bills discounted - 14,957

ii) Guarantee to 11,500 11,765 Gurgaon Gramin Bank

iii) Claims against the Company not acknowledged as debts Rent case** - 43,875

Sales Tax 45,166 30,176

Excise & Service Tax Matters 100,228 82,714

Income Tax Matters 107,328 48,447

Price Differential pending settlement 47,392 47,392

Others 27,956 28,146

* (excluding interest and penalty, if any)

** During the year, in compliance of order passed by the Hon'ble Delhi High Court in August 2011 in respect of Delhi branch rent case, the Company deposited with the court a sum of Rs.162 lakhs (including interest Rs. 81 lakhs) by way of demand drafts in the name of landlord(s), after deducting applicable TDS. However subsequent to such deposit, the Company received notice from Hon'ble Supreme Court of India revealing that the landlord(s) have preferred Special Leave Petition challenging the said order of High Court.

iv) During the year 2003, a demand of Rs. 66,222 thousand besides interest, was raised by the Haryana Urban Development Authority (HUDA) towards external development charges (EDC) which was challenged by the Company. During June 2009, the court of Hon'ble Additional Civil Judge (Senior Division) (First Court) passed an interim order whereby the Company was directed to pay interest @ 10% for delayed payment amounting to Rs. 476 thousand which was duly paid. In the year 2010 the entire demand had been set aside by the First Court. However, HUDA had challenged the same before the Court of Hon'ble District & Session Judge, Faridabad. During the year, the said appeal was dismissed by Hon'ble District & Session Judge.

v) In the year 2007 Hon'ble Punjab & Haryana High Court at Chandigarh, on a reference from the Hon'ble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008 the state of Haryana introduced Haryana Tax on Entry of Goods Into Local Area Act, 2008 (Entry Tax) by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Hon'ble Punjab & Haryana High Court.

Based on the legal opinion obtained by the Company and management's assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lacs was written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs.1,938 lacs.

Pursuant to an interim order of Hon'ble Supreme Court in October 2009, there is a stay on recovery of tax with a direction to assessees for filing their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by the court. During the year 2010 on the matter being heard by a bench of five Hon'ble judges of the Hon'ble Supreme Court, it was requested to Hon'ble Chief Justice of India to refer the matter to a suitable larger bench for deciding the constitutional validity of the levy. The larger bench of Hon'ble Supreme Court is yet to be constituted. However, based on legal opinion obtained by the Company and management assessment, no provision for HLADT and Entry tax has been considered necessary

vi) In respect of certain assessment years under Income Tax laws there are appeals / objections pending before the Hon'ble Supreme Court / Hon'ble High Court / Income tax Appellate Tribunal / Dispute Resolution Panel etc., against which based on the expert opinion the management does not consider any cash outflow at this stage.

(a) The depreciation charge for the current year represents gross Rs 198,105 (Rs. 154,625) less transfer from revaluation reserve Rs 1,212 (Rs 1,239). Such transfer represents the amount equivalent to the additional charge necessitated on account of revaluation of certain fixed assets referred to in (a) (ii) above, being the difference between the depreciation charged and the depreciation calculated in accordance with the rates followed by the Company on such items not revalued.

(b) Depreciation charge for the year includes an amount of Rs.3,196 (Rs. 5,323) provided for on an accelerated basis in respect of a category of equipment due for replacement as per technical assessment by the management.

* Net of utilisation / reversals during the year.

The above provision represents the estimated outflow in respect of the above items. However, considering the nature of items, the uncertainty and timing relating to these outflows cannot be estimated.

(c) Leases

Cancellable : The Company's cancellable operating lease arrangement mainly consists of residential premises, warehouses and offices taken on lease for periods between 1- 10 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

(d) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arms' length basis at duly negotiated prices on usual commercial terms. The Company has submitted the Accountant's Report in form 3CEB upto the financial year ended on March 31, 2011 as required under section 92E of the Income Tax Act, 1961. In respect of the proposed transfer pricing adjustments suggested by the Assessing Officers in the Assessments already completed, the matters are pending before the Appelllate Authorities / Dispute Resolution Panel. Based on expert opinion the management is of the view that in all likelihood there will be no material liability.

(e) Disclosures under the Micro, Small & Medium Enterprise Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007) based on the information available with the company:

i) Delayed payments due as at the end of accounting year on account of Principal - Rs. Nil (Nil) and Interest due thereon - Rs. Nil (Nil)

ii) Total interest paid on all delayed payments during the year under the provisions of the Act - Rs. Nil (Nil)

iii) Interest due on principal amounts paid beyond the due date during the year but without the interest amounts under this Act - Rs. Nil (Nil)

iv) Interest accrued but not due- Rs. Nil (Nil)

v) Total Interest Due but not paid - Rs. Nil (Nil)

(f) In the Board Meeting held on Feb. 21, 2011, the board considered and approved the sale of a part of land located in Ballabgarh subject to obtaining of necessary approvals for such sale. As of February 27, 2012, the Company had still not received any Government approval and therefore the sale had not yet happened.

(g) Stock and book debts are subject to a maximum charge of Rs. 350,000 (Rs. 350,000) for all credit facilities / guarantees sanctioned by BNP Paribas Bank.

(h) Previous year figures have been regrouped and recast, wherever necessary, to make them comparable to those of the current year. Figures in brackets, wherever given are in respect of previous year unless stated otherwise.

(i) All the figures are in rupee thousand unless stated otherwise.


Dec 31, 2010

As at As at (a) CONTINGENT LIABILITIES* December31, 2010 December 31, 2009 (RS.000) (RS.000)

(i) Bills discounted 14,957 --

(ii) Guarantee to Gurgaon Gramin Bank 11,765 11,833

(iii) Claims against the Company not acknowledged as debts Rent cases 43,875 43,875

Sales Tax 30,176 19,733

Excise & Service Tax Matters 82,714 50,552

Income Tax Matters 48,447 15,281

Price Differential pending settlement 47,392 -

Others 28,146 31,856

*(excluding interest and penalty, if any)

(iv) During the year 2003, a demand of Rs. 66,222 thousand besides interest, was raised by the Haryana Urban Development Authority (HUDA) towards external development charges (EDC) which was challenged by the Company. During June 2009, the court of Honble Additional Civil Judge (Senior Division) (First Court) passed an interim order whereby the Company was directed to pay interest @ 10% for delayed payment amounting to Rs. 476 thousand which was duly paid. During the year the entire demand has been set aside by the First Court. However, HUDA challenged the same before the Court of Honble District & Session Judge, Faridabad. As the Company had, in earlier years, already paid EDC, based on legal opinion and management assessment the Company is of the view that no additional demand is legally tenable.

(v) Intheyear2007, Honble Punjab & Haryana High Court at Chandigarh, on a reference from the Honble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008 the state of Haryana introduced "Haryana Tax on Entry of Goods Into Local Area Act, 2008" (Entry Tax) by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Honble Punjab & Haryana High Court.

Earlier based on the legal opinion obtained by the

Company and managements assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lacs was written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs. 1,938 lacs.

Pursuant to an interim order of Honble Supreme Court in October 2009, there is a stay on recovery of tax with a direction to assessees for filing their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by the court. During the year 2010 on the matter being heard by a bench of five Honble judges of the Honble Supreme Court, it was requested to Honble Chief Justice of India to refer the matter to a suitable larger bench for deciding the consitutional validity of the levy. The larger bench of Honble Supreme Court is yet to be constituted. However, based on legal opinion obtained by the Company and management assessment, no provision for HLADT and Entry tax has been considered necessary.

(vi) In respect of certain assessment years under Income Tax laws there are appeals / objections pending before the Honble Supreme Court/Honble High Court/Income tax Appellate Tribunal/Dispute Resolution Panel etc., against which based on the expert opinion the management does not consider any cash outflow at this stage.

(b) As the Companys business activity falls within a single primary business segment viz. Automotive tyres, tubes, flaps and related rubber products, the disclosure requirements of Accounting Standard (AS-17) "Segment Reporting" are not applicable.

(c) Disclosures under Accounting Standard 18: I) List of related parties with whom the Company had transactions during the year.

Holding company:

The Goodyear Tire & Rubber Co., Akron, Ohio, USA.

Fellow subsidiaries:

i) Goodyear International Corporation

ii) Goodyear Dunlop Tires Operations SA

iii) Goodyear Middle East, FZE

iv) Goodyear Earthmovers Pty Ltd.

v) Goodyear Dalian Tire Company Limited

vi) Goodyear & Dunlop Tyres (NZ) Ltd.

vii) Goodyear Dunlop Italia

viii) Goodyear (Thailand) Public Company Limited

ix) Goodyear Taiwan Limited

x) Goodyear Do Brasil Produtos De Borracha Ltd.

xi) Goodyear De Colombia S.A.

xii) Goodyear Great Britain Ltd.

xiii) PT Goodyear Indonesia TBK

xiv) Goodyear SA (Luxembourg)

xv) Compania Goodyear Del Peru SA

xvi) Goodyear South Africa (Pty) Limited

xvii) Goodyear Wingfoot KK

xviii) Goodyear Philippines Inc.

xix) Goodyear Lastikleri T.A.S.

xx) Goodyear Dunlop Tires, France

xxi) Goodyear Singapore Tyres

xxii) Goodyear Marketing & Sales SDN Bhd.

xxiii) TC Debica SA.

xxiv) Goodyear & Dunlop Tyres (Australia) Pty Ltd.

xxv) Goodyear South Asia Tyres Private Limited

Key management personnel:

i) Mr. RajeevAnand

li) Mr. Hugo 0 Dedekind (upto March 31, 2010)

lii) Mr. Yashwant Singh Yadav (effective November 01, 2010)

iv) Mr. Jean Philippe Lecerf (effective July 01, 2010)

(d) Depreciation charge for the year includes an amount of Rs. 5,323 (Rs. 5,943) provided for on an accelerated basis in respect of a category of equipment due for replacement as per technical assessment by the management.

(e) Leases:

Cancellable : The Companys cancellable operating lease arrangement mainly consists of residential premises, warehouses and offices taken on lease for periods between 1-10 years. Terms of lease include terms for renewal, increase in rents in future periods and terms of cancellation.

(f) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arms length basis at duly negotiated prices on usual commercial terms. The Company has submitted the Accountants Report in form 3CEB upto the financial year ended on March 31,2010 as required under section 92E of the Income Tax Act, 1961. In respect of the proposed transfer pricing adjustments suggested by the Assessing Officers in the Assessments already completed, the matters are pending before the Appellate Authorities / Dispute Resolution Panel. Based on expert opinion the management is of the view that in all likelihood there will be no material liability.

(g) Disclosures under the Micro, Small & Medium Enterprise Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007) based on the information available with the company:

h) Delayed payments due as at the end of accounting year on account of Principal - Rs. Nil (Nil) and Interest due thereon-Rs. Nil (Nil) li) Total interest paid on all delayed payments during the year under the provisions of the Act - Rs. Nil (Nil) lii) Interest due on principal amounts paid beyond the due date during the year but without the interest amounts under this Act - Rs. Nil (Nil) iv) Interest accrued but not due - Rs. Nil (Nil) v) Total Interest Due but not paid - Rs. Nil (Nil)

(i) During the year Goodyear Orient Company Private Limited, a wholly owned subsidiary of the promoter. The Goodyear Tire & Rubber Company, invited bids by way of public announcement dated May 13,2010, to acquire, in accordance with the Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009 ("Delisting Regulations") and terms and conditions set out in the Public Announcement, up to 5,997,292 equity shares of the company, representing 26% of the equity capital (the "Offer Shares") for which the approval was obtained from shareholders by way of postal ballot.

The number of Offer Shares tendered by the public shareholders at or below the discovered price was less than the minimum number of Offer Shares required to be accepted for the delisting offer to be successful in terms of Delisting Regulations. Accordingly, the delisting offer is deemed to have failed in terms of the Delisting Regulations.

(j) In accordance with AS-15 (revised) "Employee Benefits", the Company has calculated the various benefits provided to employees as under:

A. Defined Contribution Plans

a) Superannuation Fund

b) Provident Fund

(k) Stock and book debts are subject to a maximum charge of Rs. 350,000 (Rs. 350,000) for all credit facilities / guarantees sanctioned by BNP Paribas Bank.

(l) Previous year figures have been regrouped and recast, wherever necessary, to make them comparable to those of the current year. Figures in brackets, wherever given are in respect of previous year unless stated otherwise.


Dec 31, 2009

(a) CONTINGENT LIABILITIES* As at As at December 31, 2009 December 31, 2008 (Rs.000) (Rs.000)

i) Bills discounted -- 30,341

ii) Claims against the Company not acknowledged as debts

Rent cases 43,875 43,875

Sales Tax 19,733 16,605

Additional Excise Duty 48,413 48,413

Others 33,995 28,083

*(excluding interest and penalty, if any)

iii) During the year 2003, a demand of Rs. 66,222 besides interest, was raised by the Haryana Urban Development Authority towards external development charges (EDC) which has been challenged by the Company. During June 2009, the first court passed an interim order whereby the company was directed to pay interest @ 10% for delayed payment amounting to Rs. 476 which was duly paid. As the Company had, in earlier years, already paid EDC, then demanded by the concerned authorities, the management is of the view that no additional demand against the Company is legally tenable.

iv) In the year 2007 Honble Punjab & Haryana High Court at Chandigarh, on a reference from the Honble Supreme Court of India, had held the Haryana Local Area Development Tax (HLADT) as unconstitutional. Subsequently in the year 2008 the state of Haryana introduced "Haryana Tax on Entry of Goods Into Local Area Act, 2008 (Entry Tax) by repealing the Haryana Local Area Development Tax Act, 2000 and the same was also held unconstitutional by the Honble Punjab & Haryana High Court.

Earlier based on the legal opinion obtained by the Company and managements assessment, provision towards liability for Haryana Local Area Development Tax (HLADT) for the periods prior to March 2008 aggregating to Rs. 540 lacs has been written back during the year 2008. The amount already paid for HLADT till December 2006 and expensed in earlier years is Rs.1,938 lacs.

During the year 2009, as per an interim order of Honble Supreme Court, there is a stay on recovery of tax With a direction to assessees for filing their returns of tax and giving undertaking that in the event of their losing the matter, they will deposit the tax along with the interest at a rate which will be determined by this court. The matter is pending before Constitutional bench of Honble Supreme court. Based on the fresh legal opinion obtained by the Company and management assessment, no provision for HLADT and Entry tax has been considered necessary.

v) In respect of certain assessment years under Income Tax laws there are appeals pending before the Honble Supreme Court / Honble High Court / Income tax Appellate Tribunal etc., against which the Management does not consider any contingent liability at this stage.

(b) Disclosures under Accounting Standard 18:

c) List of related parties with whom the Company had transactions during the year.

Holding company:

The Goodyear Tire & Rubber Co., Akron, Ohio, USA.

Fellow subsidiaries:

i) Goodyear do Brasil Produtos de Borracha Ltd.

ii) Goodyear Dunlop Tires Operations SA

iii) PT Goodyear Indonesia Tbk

iv) Goodyear South Africa (Pty.) Limited

v) Goodyear Philippines Inc.

vi) Goodyear Lastikleri TAS

vii) Goodyear Dunlop Tires Germany Gmbh

viii) Goodyear Marketing & Sales SDN Bhd

ix) Goodyear South Asia Tyres Private Limited

x) Goodyear Dalian Tire Company Limited

xi) Compania Goodyear Del Peru SA.

xii) Goodyear (Thailand) Public Co. Ltd.

xiii) Goodyear Middle East, FZE

xiv) Goodyear De Colombia S.A

xv) TC Debica SA

xvi) South Pacific Tyres, Australia

xvii) C.A.Goodyear De Venezuela

xviii) Goodyear Earthmover Pty Ltd, Australia

xix) Goodyear Luxemburg Tires, SA

xx) Goodyear Guatemala

xxi) Goodyear Great Britain Ltd.

xxii) Goodyear Singapore Pvt. Ltd.

xxiii) Goodyear Dunlop Tires France

xxiv) Goodyear Dunlop Tyres (NZ) Ltd.

xxv) Goodyear International Corporation

xxvi) Goodyear Dunlop Tyres Italia SPA PT

xxvii) Goodyear Taiwan Limited

xxviii) Goodyear Australia Pty. Limited

xxix) Goodyear Nippon Giant (Japan NGT)

Key management personnel:

i) Mr. Rajeev Anand (effective February 20, 2009)

ii) Mr. Hugo 0 Dedekind

iii) Mr. Prabhakar Jain (resigned effective April 30, 2009)

d) The depreciation charge for the current year represents gross Rs. 127,357 (Rs. 113,171) less transfer from revaluation reserve Rs.1,268 (Rs. 1,288). Such transfer represents the amount equivalent to the additional charge necessitated on account of revaluation of certain fixed assets referred to in (a) (ii) above, being the difference between the depreciation charged arid the depreciation calculated in accordance with the rates followed by the Company on such items not revalued.

The depreciation charge for the current year represents gross 127.357 (Rs. 113,171) less transfer from revaluation reserve Rs.1,268). Such transfer the amount equivalent to the additional charge necessiatated on account of revaluation of certain fixed assests referred to in (a) (ii) above, being the difference between the depreciation charged and the depreciation calculated in accordance with the rates followed by the Company on such items not revalued.

(f) i) Depreciation charge for the year includes an amount of Rs. 5,943 (Rs. 7,427) provided for on an accelerated basis in respect of a category of equipment due for replacement as per technical assessment by the management.

ii) Depreciation for the year is net of Rs, Nil (Rs, 5,550) on account of adjustment made for the earlier years,

(g) The management is of the opinion that its international transactions with associated enterprises have been undertaken at arms length basis at duly negotiated prices on usual commerciai terms, The company has submitted the Transfer Pricing (TP) report upto the financial year ended March 31, 2009 and there is no materia! liability on assessments completed by the income Tax Authorities,

(h) Disclosures under the Micro, Smaii & Medium Enterprise Development Act, 2006 (as amended in Schedule VI to the Companies Act, 1956 vide notification dated November 16, 2007} based on the

i) Delayed payments due as at the end of accounting year on account of Principal - Rs. Nil (Nil) and Interest due thereon-Rs. Nil (Nil)

ii) Total interest paid on all delayed payments during the year under the provisions of the Act - Rs. Nil (Nil)

iii) Interest due on principal amounts paid beyond the due date during the year but without the interest amountsunderthisAct-Rs. Nil (Nil)

iv) Interest accrued but not due - Rs. Nil (Nil)

v) Total Interest Due but not paid -Rs. Nil (Nil)

C. Defined Benefit Plans

a) Gratuity

b) Leave Encashment / Compensated Absence

c) Employers Contribution to Provident Fund (shortfall in interest on Provident Fund balance).

(i) Previous year figures have been regrouped and recast, wherever necessary to make them comparable to those of the current year. Figures in brackets, wherever given are in respect of previous year unless stated otherwise.

(j) All the figures in rupee thousand unless strated otherwise.

 
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