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Notes to Accounts of Graphite India Ltd.

Mar 31, 2016

1 The Company has one class of Equity Shares having a par value of Rs. 2/ - per share . 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.

2 Represents exchange differences arising on long - term foreign currency loans obtained for the purpose of acquisition of depreciable capital assets [Refer Note 1(H) above].

3 Represents adjustment due to revision in useful lives of certain fixed assets due to componentization as per Schedule II to the Act (Refer Note 38).

4 Represents adjustment due to revision in useful lives of certain fixed assets as per Schedule II to the Act.

5 Title deeds of immovable properties set out in Note 11.1 above, where applicable, are in the name of the Company except as set out below which are in the name of Graphite Vicarb India Limited (GVIL)/Powmex Steels Limited (PSL), inter alia, the immovable properties of GVIL/PSL got transferred to and vested in the Company pursuant to the respective Schemes of Arrangement in earlier years.

6. The Company had reviewed its tangible fixed assets as at 1st April, 2015 and identified certain significant components with different useful lives from the remaining parts of the asset in keeping with the provisions of Schedule II to the Companies Act, 2013. The depreciation has been computed for such components separately effective 1st April, 2015. As a result, the depreciation expense for the year ended 31st March, 2016 is higher and the profit before tax is lower by Rs. 648.71 Lakhs and the net book value aggregating Rs. 1,179.80 Lakhs (net of deferred tax Rs. 569.06 Lakhs) relating to assets, where the revised useful lives have expired by 31st March, 2015 has been adjusted against opening balance of retained earnings as on 1st April, 2015.

The aforesaid revision of the useful lives will result in the following changes in the depreciation expense as compared to the original useful life of the assets.

7. Fixed Assets including Capital Work-in-progress includes Pre-operative expenses : Salaries & Wages Rs. 8.60 Lakhs (Previous Year - Rs. Nil), Rates and Taxes Rs. 5.37 Lakhs (Previous Year - Rs. 7.45 Lakhs), Insurance Rs. Nil (Previous Year - Rs. 3.16 Lakhs), Travelling and Conveyance Rs.2.79 Lakhs (Previous Year - Rs. 2.65 Lakhs), Contract Labour Charges Rs. 39.83 Lakhs (Previous Year - Rs. Nil) and Miscellaneous Expenses Rs. 36.27 Lakhs (Previous Year - Rs. 0.17 Lakhs).

The above particulars, as applicable, have been given in respect of MSEs to the extent they could be identified on the basis of the information available with the Company.

8. Employee Benefits:

(I) Post Employment Defined Benefit Plans:

(A) Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), make payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee’s salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(N)(b) above, based upon which, the Company makes contributions to the Employees’ Gratuity Funds.

The following table sets forth the particulars in respect of the Gratuity Plan (Funded) of the Company for the year ended 31st March, 2016:

Notes:

(a) The estimate of future salary increases takes into account inflation, seniority, promotion and other relevant factors, such as demand and supply in the employment market.

(b) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Company’s policy for plan asset management and other relevant factors.

(B) Provident Fund

Contributions towards provident funds are recognized as expense for the year. The Company has set up Provident Fund Trusts in respect of certain categories of employees which is administered by Trustees. Both the employees and the Company make monthly contributions to the Funds at specified percentage of the employee’s salary and aggregate contributions along with interest thereon are paid to the employees/nominees at retirement, death or cessation of employment. The Trusts invest funds following a pattern of investments prescribed by the Government. The interest rate payable to the members of the Trusts is not lower than the rate of interest declared annually by the Government under The Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, on account of interest is to be made good by the Company.

In terms of the Guidance on implementing Accounting Standard 15 (Revised 2005) on “Employee Benefits’ issued by the Accounting Standard Board of The Institute of Chartered Accountants of India (ICAI), Provident Fund Trusts set up by the Company are treated as defined benefit plans in view of the Company’s obligation to meet shortfall, if any, on account of interest.

The Actuary has carried out actuarial valuation of plan’s liabilities and interest rate guarantee obligations as at the Balance Sheet date using Projected Unit Credit Method and Deterministic Approach as outlined in the Guidance Note 29 issued by the Institute of Actuaries of India. Based on such valuation, an amount of Rs. 22.26 Lakhs (Previous Year - Rs. 21.70 Lakhs) has been provided towards future anticipated shortfall with regard to interest rate obligation of the Company as at the Balance Sheet date. Further during the year, the Company’s contribution of Rs. 30.60 Lakhs (Previous Year - Rs. 31.25 Lakhs) to the Provident Fund Trusts has been expensed under the ‘Contribution to Provident and Other Funds’ in Note 26. Disclosures given hereunder are restricted to the relevant information available as per the Actuary’s Report -

9. Employee Benefits: (Contd.)

(II) Post Employment Defined Contribution Plans

During the year, an amount of Rs. 795.70 Lakhs (Previous Year - Rs. 771.04 Lakhs) has been recognized as expenditure towards defined contribution plans of the Company.

10. The following table includes the classification of investments in accordance with Accounting Standard (AS) 13 -‘Accounting for Investments’

11. Segment Information

A. Primary Segment Reporting (by Business Segments)

i) The composition of business segments is as under:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Other Miscellaneous Carbon and Graphite Products including Captive Power Generating Units and Impervious Graphite Equipment division.

b) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

c) Others Segment engaged in manufacturing of Glass Reinforced Pipes and Power Generating Unit exclusively for outside sale.

ii) Composition of Geographical Segments

The geographical segments considered for disclosure are as follows :

a) Sales within India include sales to customers located within India

b) Sales outside India include sales to customers located outside India

c) The carrying amount of segment assets in India and outside India is based on geographical location of assets.

12. Related Party Disclosures:

(In accordance with Accounting Standard - 18 specified under the Act)

(i) Related Parties -

Name Relationship

(a) Where control exists:

Emerald Company Limited (ECL) Holding Company

Bavaria Carbon Holdings GmbH Subsidiary

Bavaria Carbon Specialities GmbH Subsidiary

Bavaria Electrodes GmbH Subsidiary

Carbon Finance Limited Subsidiary

Graphite Cova GmbH Subsidiary

Graphite International B.V. Subsidiary

(b) Others with whom transactions have taken place during the year:

Carbo Ceramics Limited Fellow Subsidiary (up to 11th March, 2015)

Shree Laxmi Agents Limited Fellow Subsidiary

Mr. K. K. Bangur Individual owning an interest in the voting power of

ECL that gives him control over the Company

Mrs. Manjushree Bangur, Ms. Divya Bangur, Mrs. Aparna

Daga and Mrs. Rukmani Devi Bangur Relatives of the above individual

GKW Limited and B.D. Bangur Endownment Enterprise over which Mr. K. K. Bangur is able to

exercise significant influence

Mr. M. B. Gadgil, Executive Director Key Management Personnel

13. The Company has cancellable operating lease arrangements for certain accommodation. Terms of such lease include option for renewal on mutually agreed terms. Operating lease rentals for the year debited to the Statement of Profit and Loss amount to Rs. 129.26 Lakhs (Previous Year - Rs. 122.80 Lakhs).

14. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Hon’ble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

15. Research and Development Expenditure of revenue nature of Rs. 12.58 Lakhs (Previous Year - Rs. 12.95 Lakhs).

16. Previous year’s figures have been regrouped/rearranged, wherever necessary to conform to current year’s classification.


Mar 31, 2015

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' specified under the Act.

2. Previous year's figures have been regrouped /rearranged, wherever necessary to conform to current year's classification.

2.1 The Company has one class of Equity Shares having a par value of Rs. 2/- per share. 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.

(b) The Company has become a subsidiary of ECL pursuant to a Scheme of Amalgamation of The Bond Company Limited, Guardian Leasing Limited, Likhami Leasing Limited, H.L. Investment Company Limited, Tandem Fiscal Services Limited, Uttam Fiscal Services Limited, D.C. Mercantile Private Limited and SCL Investments Private Limited with ECL as sanctioned by the Hon'ble High Court at Calcutta vide Order passed during the current year. The certified copies of the aforesaid Order have been filed with the Registrar of Companies on 3rd July, 2014 (Effective Date of the Scheme).

Terms of Repayment -

(a) Total loan amount of Rs. 4,172.00 Lakhs (USD 6.67 Million) [Previous Year - Rs. 8,013.34 Lakhs (USD 13.33 Million)] is repayable on February, 2016. Interest is payable on quarterly basis at Libor plus 1.85% p.a. Current maturity of the loan amounting to Rs. 4,172.00 Lakhs (Previous Year - Rs. 4,006.67 Lakhs) has been disclosed in Note 9.

(b) Total loan amount of Rs. 6,258.00 Lakhs (USD 10 Million) [Previous Year - Rs. 6,010.00 Lakhs (USD 10 Million)] is repayable in 3 equal annual installments commencing from August, 2015. Interest is payable on quarterly basis at Libor plus 2.10% p.a. Current maturity of the loan amounting to Rs.2,086.00 Lakhs (Previous Year - Rs. Nil) has been disclosed in Note 9.

@ After considering Rs. 767.65 Lakhs (Previous Year - Rs. Nil) being tax effect arising from adjustment of Net Book Value of certain Fixed Assets in the General Reserve (Refer Note 37).

Loans Repayable on Demand from Banks

(Secured by first charge by way of hypothecation of certain stocks and book debts, both present and future, and secured by creation of second charge by way of mortgage/charge on certain other movable and immovable assets of the Company, both ranking pari- passu amongst the related chargeholders)

3.1 Balance outstanding as at 31st March, 2015 in respect of Commercial Paper was Rs. Nil (Previous Year - Rs. Nil). Maximum amount outstanding at any time during the year was Rs. 5,000.00 Lakhs (Previous Year - Rs. 5,000.00 Lakhs).

4.1 For classification of investments in accordance with Accounting Standard (AS) 13 - 'Accounting for Investments', refer Note 43.

4.2 Reclassified from current to long-term on exercise of extension option of maturity provided by the respective schemes during the year.

4.3 Reclassified from current to non-current on exercise of extension option of maturity provided by the respective schemes during the year.

5. Contingent Liabilities -

(i) Claims against the Company not acknowledged as debts:

(a) Disputed Excise Duty 1,023.12 1,023.12

(b) Disputed Customs Duty 1,163.01 1,163.01

(c) Disputed Service Tax 509.06 2,516.07

(d) Disputed Sales Tax / Value Added Tax 656.09 516.54

(e) Disputed Entry Tax 383.50 360.08

(f) Disputed Income Tax 120.90 880.47

(g) Labour Related Matters 585.63 503.69

(h) Other Matters (Property, Rental, etc.) 316.58 49.23

(ii) Guarantee 16,144.80 6,195.75 Corporate Guarantees given to banks to secure the financial assistance/ accommodation extended to Subsidiary Companies

(iii) In respect of Contingent Liabilities mentioned in Note 36(i) above, it is not practicable for the Company to estimate the timings of cash outflows, if any, pending resolution of the respective proceedings. The Company does not expect any reimbursements in respect of the above Contingent Liabilities.

6. Effective 1st April, 2014, the estimated useful lives of fixed assets have been revised in keeping with the provisions of Schedule II to the Companies Act, 2013. Pursuant to the said revision in useful lives, the depreciation expense for the year ended 31st March, 2015 is lower and the profit before tax is higher by Rs. 1,033.39 Lakhs and the net book value aggregating Rs. 1,746.57 Lakhs [net of deferred tax Rs. 767.65 Lakhs] relating to assets, where the revised useful lives have expired by 31st March, 2014, has been adjusted against opening balance of General Reserve (Note 3) as on 1st April, 2014.

The aforesaid revision of the useful lives will result in the following changes in the depreciation expense as compared to the original useful life of the assets.

7. Fixed Assets including Capital Work-in-progress includes Pre-operative expenses : Salaries and Wages Rs. Nil (Previous Year - Rs. 6.50 Lakhs), Power and Fuel Rs. Nil (Previous Year - Rs. 14.56 Lakhs), Rates and Taxes Rs. 7.45 Lakhs (Previous Year - Rs. Nil), Insurance Rs. 3.16 Lakhs (Previous Year - Rs. Nil), Travelling and Conveyance Rs. 2.65 Lakhs (Previous Year - Rs. Nil), Contractors' Labour Charges Rs. Nil (Previous Year - Rs. 5.18 Lakhs) and Miscellaneous Expenses Rs. 0.17 Lakhs (Previous Year - Rs.Nil).

8. Employee Benefits:

(I) Post Employment Defined Benefit Plans:

(A) Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), make payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(N)(b) above, based upon which, the Company makes contributions to the Employees' Gratuity Funds.

The following table sets forth the particulars in respect of the Gratuity Plan (Funded) of the Company for the year ended 31st March, 2015:

Notes:

(a) The estimate of future salary increases takes into account inflation, seniority, promotion and other relevant factors, such as demand and supply in the employment market.

(b) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Company's policy for plan asset management and other relevant factors.

(B) Provident Fund

Contributions towards provident funds are recognised as expense for the year. The Company has set up Provident Fund Trusts in respect of certain categories of employees which is administered by Trustees. Both the employees and the Company make monthly contributions to the Funds at specified percentage of the employee's salary and aggregate contributions along with interest thereon are paid to the employees/nominees at retirement, death or cessation of employment. The Trusts invest funds following a pattern of investments prescribed by the Government. The interest rate payable to the members of the Trusts is not lower than the rate of interest declared annually by the Government under The Employees' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, on account of interest is to be made good by the Company.

In terms of the Guidance on implementing Accounting Standard 15 (Revised 2005) on 'Employee Benefits' issued by the Accounting Standard Board of The Institute of Chartered Accountants of India (ICAI), Provident Fund Trusts set up by the Company are treated as defined benefit plans in view of the Company's obligation to meet shortfall, if any, on account of interest.

The Actuary has carried out actuarial valuation of plan's liabilities and interest rate guarantee obligations as at the Balance Sheet date using Projected Unit Credit Method and Deterministic Approach as outlined in the Guidance Note 29 issued by the Institute of Actuaries of India. Based on such valuation, an amount of Rs. 21.70 Lakhs (Previous Year - Rs. 21.30 Lakhs) has been provided towards future anticipated shortfall with regard to interest rate obligation of the Company as at the Balance Sheet date. Further during the year, the Company's contribution of Rs. 31.25 Lakhs (Previous Year - Rs. 41.63 Lakhs) to the Provident Fund Trusts has been expensed under the 'Contribution to Provident and Other Funds' in Note 25. Disclosures given hereunder are restricted to the relevant information available as per the Actuary's Report -

(II) Post Employment Defined Contribution Plans

During the year, an amount of Rs. 771.04 Lakhs (Previous Year - Rs. 755.63 Lakhs) has been recognised as expenditure towards defined contribution plans of the Company.

9. Segment Information

A. Primary Segment Reporting (by Business Segments)

i) The composition of business segments is as under:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Other Miscellaneous Carbon and Graphite Products including Captive Power Generating Units and Impervious Graphite Equipment division.

b) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

c) Others Segment engaged in manufacturing of Glass Reinforced Pipes and Power Generating Unit exclusively for outside sale.

ii) Composition of Geographical Segments

The geographical segments considered for disclosure are as follows:

a) Sales within India include sales to customers located within India

b) Sales outside India include sales to customers located outside India

c) The carrying amount of segment assets in India and outside India is based on geographical location of assets.

10. Related Party Disclosures:

(In accordance with Accounting Standard-18 specified under the Act)

(i) Related Parties -

Name Relationship

(a) Where control exists:

Emerald Company Limited (ECL) [Refer Note 2.2(b)] Holding Company

Bavaria Carbon Holdings GmbH Subsidiary

Bavaria Carbon Specialities GmbH Subsidiary

Bavaria Electrodes GmbH Subsidiary

Carbon Finance Limited Subsidiary

Graphite Cova GmbH Subsidiary

Graphite International B.V. Subsidiary

(b) Others with whom transactions have taken place during the year:

Carbo Ceramics Limited Fellow Subsidiary (up to 11th March, 2015) [Refer Note 2.2(b)

Shree Laxmi Agents Limited Fellow Subsidiary [Refer Note 2.2(b)]

Likhami Leasing Limited A Shareholder holding 28.60% Equity Shares [Refer Note 2.2(b)] of the Company

Mr. K. K. Bangur Individual owning an interest in the voting power of ECL that gives him control over the Company

Mrs. Manjushree Bangur, Relatives of the above individual Ms. Divya Bangur, Mrs.Aparna Daga and Mrs. Rukmani Devi Bangur

GKW Limited Enterprise over which Mr. K. K. Bangur is able to exercise significant influence

Mr. M. B. Gadgil, Executive Key Management Personnel Director

11. The Company has cancellable operating lease arrangements for certain accommodation. Terms of such lease include option for renewal on mutually agreed terms. Operating lease rentals for the year debited to the Profit and Loss Statement amount to Rs. 122.80 Lakhs (Previous Year - Rs. 110.21 Lakhs).

12. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Hon'ble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

13. Research and Development Expenditure of revenue nature of Rs. 12.95 Lakhs (Previous Year - Rs. 13.85 Lakhs).

14. Previous year's figures have been regrouped / rearranged, wherever necessary to conform to current year's classification.


Mar 31, 2014

1. Contingent Liabilities -

(i) Claims against the Company not acknowledged as debts:

(a) Disputed Excise Duty 1,023.12 523.95

(b) Disputed Customs Duty 1,163.01 999.62

(c) Disputed Service Tax 2,516.07 324.92

(d) Disputed Sales Tax / Value Added Tax 516.54 528.46

(e) Disputed Entry Tax 360.08 246.04

(f) Disputed Income Tax 880.47 1.89

(g) Labour Related Matters 503.69 324.42

(h) Other Matters (Rent etc.) 49.23 49.23

(Rs. in Lakhs)

As at 31 st As at 31st March, 2014 March, 2013

(ii) Guarantee

Corporate Guarantees given to banks to secure the financial assistance/accommodation extended to Subsidiary Companies 6,195.75 5,209.50

(iii) In respect of Contingent Liabilities mentioned in Note 37(i) above, it is not practicable for the Company to estimate the timings of cash outflows, if any, pending resolution of the respective proceedings. The Company does not expect any reimbursements in respect of the above Contingent Liabilities.

2. The Company had entered into a Power Delivery Agreement (PDA) with Wardha Power Company Limited (WPCL) for procurement of power for its manufacturing activity at the terms set out in the said agreement for twenty five years from the commencement of commercial operation of power plant to be declared by WPCL. As per the terms of Share Subscription Agreement (SSA) with WPCL, the Company invested Rs. 247.66 Lakhs (Previous Year – Rs. 247.66 Lakhs) in its Class A Equity Shares and Rs. 312.34 Lakhs (Previous Year – Rs. 312.34 Lakhs) in its 0.01% Class A Redeemable Preference Shares, shown under Non-current Investments (Note 12) and were required to subscribe Rs.350.00 Lakhs (Previous Year – Rs. 350.00 Lakhs) to Class C Redeemable Preference Shares of WPCL prior to commencement of commercial operation of the said Power Plant. The aforesaid shares are/shall be under lien with WPCL.

Upon the expiry of Power Delivery Agreement, Class A Equity Shares and Class A Redeemable Preference Shares will be bought back by WPCL for a total consideration of Re.1.00. One-tenth of Class C Redeemable Preference Shares will be redeemed on every anniversary from the date of issue at Re.0.01 per share.

Pursuant to failure of WPCL to commence power supply in accordance with the terms of PDA, the Company terminated the PDA and SSA and asked them to buy back the shares held by the Company along with interest. The Company has invoked the arbitration clause as provided in the agreement.

3. Fixed Assets including Capital Work-in-progress includes Pre-operative expenses : Salaries and Wages Rs. 6.50 Lakhs (Previous Year – Rs. 41.22 Lakhs), Contribution to Provident and Other Funds Rs. Nil (Previous Year – Rs. 5.23 Lakhs), Consumption of Stores and Spare Parts Rs. Nil (Previous Year – Rs. 0.20 Lakhs), Power and Fuel – Rs. 14.56 Lakhs (Previous Year – Rs. Nil), Rates and Taxes Rs. Nil (Previous Year – Rs. 0.12 Lakhs), Insurance Rs. Nil (Previous Year – Rs. 5.04 Lakhs), Travelling and Conveyance Rs. Nil (Previous Year – Rs. 1.03 Lakhs), Contractors'' Labour Charges Rs. 5.18 Lakhs (Previous Year – Rs. Nil), Miscellaneous Expenses Rs. Nil (Previous Year – Rs. 17.89 Lakhs) and Interest and Other Borrowing Cost Rs. Nil (Previous Year – Rs. 130.91 Lakhs).

4. Employee Benefits:

(I) Post Employment Defined Benefit Plans:

(A) Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), make payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(N)(b) above, based upon which, the Company makes contributions to the Employees'' Gratuity Funds.

Notes :

(a) The estimate of future salary increases takes into account inflation, seniority, promotion and other relevant factors, such as demand and supply in the employment market.

(b) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Company''s policy for plan asset management and other relevant factors.

(B) Provident Fund

Contributions towards provident funds are recognised as expense for the year. The Company has set up Provident Fund Trusts in respect of certain categories of employees which is administered by Trustees. Both the employees and the Company make monthly contributions to the Funds at specified percentage of the employee''s salary and aggregate contributions along with interest thereon are paid to the employees/nominees at retirement, death or cessation of employment. The Trusts invest funds following a pattern of investments prescribed by the Government. The interest rate payable to the members of the Trusts is not lower than the rate of interest declared annually by the Government under The Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, on account of interest is to be made good by the Company.

In terms of the Guidance on implementing Accounting Standard 15 (Revised 2005) on ''Employee Benefits'' issued by the Accounting Standard Board of The Institute of Chartered Accountants of India (ICAI), Provident Fund Trusts set up by the Company are treated as defined benefit plans in view of the Company''s obligation to meet shortfall, if any, on account of interest.

The Actuary has carried out actuarial valuation of plan''s liabilities and interest rate guarantee obligations as at the Balance Sheet date using Projected Unit Credit Method and Deterministic Approach as outlined in the Guidance Note 29 issued by the Institute of Actuaries of India. Based on such valuation, an amount of Rs. 21.30 Lakhs (Previous Year - Rs. Nil) has been provided towards future anticipated shortfall with regard to interest rate obligation of the Company as at the Balance Sheet date. Further during the year, the Company''s contribution of Rs. 41.63 Lakhs (Previous Year - Rs. 35.89 Lakhs) to the Provident Fund Trusts has been expensed under the ''Contribution to Provident and Other Funds'' in Note 26. Disclosures given hereunder are restricted to the information available as per the Actuary''s Report -

(II) Post Employment Defined Contribution Plans

During the year, an amount of Rs.755.63 Lakhs (Previous Year - Rs. 683.18 Lakhs) has been recognised as expenditure towards defined contribution plans of the Company.

5. Disclosure pursuant to SEBI''s circular No. SMD/POLICY/CIR-02/2003 –

The Company has given loans and advances in the nature of loans to its employees for housing, medical etc. [balance outstanding as on 31st March, 2014 is Rs. 311.84 Lakhs (Previous Year - Rs. 249.69 Lakhs)] where, in some cases, the repayment schedule extends beyond seven years and interest is below the rate referred to in Section 372A of the Companies Act, 1956. In view of the voluminous data, furnishing of required particulars by name, amount and maximum amount due in respect of such loans is not considered practicable.

6. Segment Information

A. Primary Segment Reporting (by Business Segments) i) The composition of business segments is as under:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Other Miscellaneous Carbon and Graphite Products including Captive Power Generating Units and Impervious Graphite Equipment (IGE) division.

b) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

c) Others Segment engaged in manufacturing of Glass Reinforced Pipes (GRP) and Power Generating Unit exclusively for outside sale.

ii) Composition of Geographical Segments

The geographical segments considered for disclosure are as follows:

a) Sales within India include sales to customers located within India

b) Sales outside India include sales to customers located outside India

c) The carrying amount of segment assets in India and outside India is based on geographical location of assets. 48. The Company has cancellable operating lease arrangements for certain accommodation. Terms of such lease include option for renewal on mutually agreed terms. Operating lease rentals for the year debited to Profit and Loss Statement amount to Rs. 110.21 Lakhs (Previous Year - Rs. 108.64 Lakhs).

7. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Hon''ble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

8. Research and Development Expenditure of revenue nature of Rs. 13.85 Lakhs (Previous Year - Rs. 21.41 Lakhs).

9. Previous year''s figures have been re-grouped / re-arranged, wherever necessary to conform to current year''s classification.


Mar 31, 2013

1.1 Represents the aggregate amount of excise duty borne by the Company and difference between excise duty on opening and closing stock of finished goods.

2. Contingent Liabilities -

(i) Claims against the Company not acknowledged as debts:

(a) Disputed Excise Duty 523.95 567.54

(b) Disputed Customs Duty 999.62 1,004.47

(c) Disputed Service Tax 324.92 256.35

(d) Disputed Sales Tax 528.46 524.34

(e) Disputed Entry Tax 246.04 267.28

(f) Disputed Income Tax 1.89 -

(g) Labour Related and Other Matters 373.65 355.70

3. The Company had entered into a Power Delivery Agreement (PDA) with Wardha Power Company Limited (WPCL) for procurement of power for its manufacturing activity at the terms set out in the said agreement for twenty five years from the commencement of commercial operation of power plant to be declared by WPCL. As per the terms of Share Subscription Agreement (SSA) with WPCL, the Company invested Rs. 247.66 Lakhs (Previous Year - Rs. 247.66 Lakhs) in its Class A Equity Shares and Rs. 312.34 Lakhs (Previous Year - Rs. 312.34 Lakhs) in its 0.01% Class A Redeemable Preference Shares, shown under Non-current Investments (Note 12) and were required to subscribe Rs.350.00 Lakhs (Previous Year - Rs. 350.00 Lakhs) to Class C Redeemable Preference Shares of WPCL prior to commencement of commercial operation of the said Power Plant. The aforesaid shares are/shall be under lien with WPCL.

Upon the expiry of Power Delivery Agreement, Class A Equity Shares and Class A Redeemable Preference Shares will be bought back by WPCL for a total consideration of Re. 1.00. One-tenth of Class C Redeemable Preference Shares will be redeemed on every anniversary from the date of issue at Re.0.01 per share.

Pursuant to failure of WPCL to commence power supply in accordance with the terms of PDA, the Company terminated the PDA and SSA and asked them to buy back the shares held by the Company alongwith interest. The Company has invoked the arbitration clause as provided in the agreement.

4. Fixed Assets including Capital Work-in-Progress includes Pre-operative expenses : Salaries and Wages Rs. 41.22 Lakhs (Previous Year - Rs. 101.89 Lakhs), Contribution to Provident and Other Funds Rs. 5.23 Lakhs (Previous Year - Rs. 10.70 Lakhs), Consumption of Stores and Spare Parts Rs. 0.20 Lakhs (Previous Year - Rs. Nil), Rates and Taxes Rs. 0.12 Lakhs (Previous Year - Rs. Nil), Insurance Rs. 5.04 Lakhs (Previous Year - Rs. 1.20 Lakhs), Travelling and Conveyance Rs. 1.03 Lakhs (Previous Year - Rs. 6.80 Lakhs), Miscellaneous Expenses Rs. 17.89 Lakhs (Previous Year - Rs. 63.21 Lakhs) and Interest and Other Borrowing Cost Rs. 130.91 Lakhs (net of Interest Income of Rs. Nil) [(Previous Year - Rs. 376.52 Lakhs) (net of Interest Income of Rs. 18.71 Lakhs)].

5. Exceptional item Rs. Nil (Previous Year - Rs. 2,961.63 Lakhs) represents profit on disposal of long-term investments in a wholly owned subsidiary.

6. Employee Benefits:

(I) Post Employment Defined Benefit Plans:

(A) Gratuity (Funded)

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), make payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee''s salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(N)(b) above, based upon which, the Company makes contributions to the Employees'' Gratuity Funds.

(B) Provident Fund

Contributions towards provident funds are recognised as expense for the year. The Company has set up Provident Fund Trusts in respect of certain categories of employees which is administered by Trustees. Both the employees and the Company make monthly contributions to the Funds at specified percentage of the employee''s salary and aggregate contributions along with interest thereon are paid to the employees/nominees at retirement, death or cessation of employment. The Trusts invest funds following a pattern of investments prescribed by the Government. The interest rate payable to the members of the Trusts is not lower than the rate of interest declared annually by the Government under The Employees'' Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, on account of interest is to be made good by the Company.

In terms of the Guidance on implementing Accounting Standard 15 (Revised 2005) on Employee Benefits issued by the Accounting Standards Board of The Institute of Chartered Accountants of India (ICAI), Provident Fund Trusts set up by the Company are treated as defined benefit plans in view of the Company''s obligation to meet shortfall, if any, on account of interest.

The Actuary has carried out actuarial valuation of plan''s liabilities and interest rate guarantee obligations as at the balance sheet date using Projected Unit Credit Method and Deterministic Approach as outlined in the Guidance Note 29 issued by the Institute of Actuaries of India. Based on such valuation, there is no future anticipated shortfall with regard to interest rate obligation of the Company as at the balance sheet date. Further during the year, the Company''s contribution of Rs. 35.89 Lakhs (Previous Year - Rs. 35.16 Lakhs) to the Provident Fund Trusts has been expensed under the ''Contribution to Provident and Other Funds'' in Note 26. Disclosures given hereunder are restricted to the information available as per the Actuary''s report -

(b) The Company has given loans and advances in the nature of loans to its employees for housing, medical etc. [balance outstanding as on 31st March, 2013 is Rs. 249.69 Lakhs (Previous Year - Rs. 213.00 Lakhs)] where, in some cases, the repayment schedule extends beyond seven years and interest is below the rate referred to in Section 372A of the Companies Act, 1956. In view of the voluminous data, furnishing of required particulars by name, amount and maximum amount due in respect of such loans is not considered practicable.

7. Segment Information

A. Primary Segment Reporting (by Business Segments)

i) Considering the present operating environment and risks and returns from its businesses, the Company has revised during the year the composition of business segments for its segment reporting. Accordingly, Captive power generating units and Impervious Graphite Equipment (IGE) division which were included under ''Power Segment'' and ''Others Segment'' respectively in the previous year have now been included under ''Graphite and Carbon Segment''. Further, power generating unit used for external sales which was included under ''Power Segment'' in the previous year has been included under ''Others Segment'' as the same accounts for less than the threshold limits specified in AS 17 on ''Segment Reporting'' in the current as well as in the previous year. The previous year figures have also been regrouped / rearranged to make the same comparable with the current year figures.

The revised composition of business segments is as under:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, other Miscellaneous Carbon and Graphite Products including Captive power generating units and Impervious Graphite Equipment (IGE) division.

b) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

c) Others Segment engaged in manufacturing of Glass Reinforced Pipes (GRP) and Power generating unit exclusively for outside sale.

ii) Composition of Geographical Segments

The geographical segments considered for disclosure are as follows:

a) Sales within India includes sales to customers located within India

b) Sales outside India includes sales to customers located outside India

8. The Company has cancellable operating lease arrangements for certain accommodation with tenures ranging from one to three years. Terms of such lease include option for renewal on mutually agreed terms. Operating lease rentals for the year debited to Profit and Loss Statement amount to Rs. 108.64 Lakhs (Previous Year - Rs. 100.51 Lakhs).

9. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Hon''ble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

10. Research and Development Expenditure of revenue nature of Rs. 21.41 Lakhs (Previous Year - Rs. 24.87 Lakhs).

11. Previous Year''s figures have been re-grouped / re-arranged, wherever necessary to conform to current year''s classification.


Mar 31, 2012

1.1 The Company has one class of Equity Shares having a par value of Rs. 2/- per share. 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 shareholdings.

1.1 Represents dividend paid in respect of 11,932,742 Equity Shares of Rs. 2/- each allotted on conversion of Foreign Currency Convertible Bonds before the book closure date but after 31st March, 2010 as indicated in Note 2.1 above.

3.1 Gross Block as at 31st March, 2012 includes Rs. 720.35 Lakhs (Previous Year - Rs. 720.35 Lakhs) being expenditure in respect of Outdoor Transmission Lines not owned by the Company. Written down value of said assets as on 31st March, 2012 is Rs. 226.65 Lakhs (Previous Year - Rs. 260.87 Lakhs).

3.2 Includes Rs. 132.02 Lakhs (Previous Year - Rs. Nil) transferred from Capital Work-in-Progress.

4.1 Includes 1,300,000 shares acquired on conversion of loan.

4.2 The Company has disposed of its entire shareholding in Carbon International Holdings N.V. (CINV), a wholly owned subsidiary on 14th March, 2012 at a consideration of Rs. 3,018.09 Lakhs. Consequent upon its disposal, CINV has ceased to be a subsidiary with effect from the aforesaid date.

5. Commitments -

(iv) The Company has entered into a Power Delivery Agreement with Wardha Power Company Limited (WPCL) for procurement of power for its manufacturing activity at the terms set out in the said agreement for twenty five years from the commencement of commercial operation of power plant to be declared by WPCL. As per the terms of another related agreement with WPCL, the Company invested Rs. 247.66 Lakhs (Previous Year – Rs. 247.66 Lakhs) in its Class A Equity Shares and Rs. 312.34 Lakhs (Previous Year – Rs. 312.34 Lakhs) in its 0.01% Class A Redeemable Preference Shares, shown under Non-current Investments (Note 12) and are required to subscribe Rs.350.00 Lakhs to Class C Redeemable Preference Shares of WPCL prior to commencement of commercial operation of the said Power Plant. The aforesaid shares are/shall be under lien with WPCL.

Upon the expiry of Power Delivery Agreement, Class A Equity Shares and Class A Redeemable Preference Shares will be bought back by WPCL for a total consideration of Re.1.00. One-tenth of Class C Redeemable Preference Shares will be redeemed on every anniversary from the date of issue at Re.0.01 per share.

6. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Hon'ble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

7. Fixed Assets including Capital Work-in-Progress includes Pre-operative expenses : Salaries and Wages Rs. 101.89 Lakhs (Previous Year – Rs. 51.79 Lakhs), Contribution to Provident and Other Funds Rs. 10.70 Lakhs (Previous Year – Rs. 7.30 Lakhs), Consumption of Stores and Spare Parts Rs. Nil (Previous Year – Rs. 5.27 Lakhs), Power and Fuel Rs. Nil (Previous Year – Rs. 2.60 Lakhs), Rates and Taxes Rs. Nil (Previous Year – Rs. 0.67 Lakhs), Insurance Rs. 1.20 Lakhs (Previous Year – Rs. 1.35 Lakhs), Travelling and Conveyance Rs. 6.80 Lakhs (Previous Year – Rs. 4.82 Lakhs), Miscellaneous Expenses Rs. 63.21 Lakhs (Previous Year – Rs. 29.58 Lakhs) and Interest and Other Borrowing Cost Rs. 376.52 Lakhs (net of Interest Income of Rs. 18.71 Lakhs)[(Previous Year – Rs. 273.79 Lakhs) (net of Interest Income of Rs. 34.79 Lakhs)].

8. Employee Benefits:

(I) Post Employment Defined Benefit Plans:

(A) Gratuity

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), make payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employee's salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(L)(b) above, based upon which, the Company makes contributions to the Employees' Gratuity Funds.

(B) Provident Fund

Certain employees of the Company receive provident fund benefits, which are administered by the Provident Fund Trusts set up by the Company. Aggregate contributions along with interest thereon are paid at retirement, death, incapacitation or termination of employment. Both the employees and the Company make monthly contributions at specified percentage of the employee's salary to such Provident Fund Trusts. The Company has an obligation to fund any shortfall in return on plan assets over the interest rates prescribed by the authorities from time to time.

In terms of the Guidance on implementing Accounting Standard -15 (AS -15) on 'Employee Benefits' issued by the Accounting Standards Board of The Institute of Chartered Accountants of India (ICAI), a provident fund set up by the Company is a defined benefit plan in view of the Company's obligation to meet shortfall, if any, on account of interest.

Unlike previous year, consequent upon issuance of Guidance Note by The Institute of Actuaries of India in 2011-12, actuarial valuation of the provident fund as at the year-end has been done under the Projected Unit Credit Method and the resultant charge / gain has been recognised in the accounts. Information pertaining to the year required to be considered as per AS-15 in this regard is also disclosed. However, in the absence of a Guidance Note from The Institute of Actuaries of India in earlier years, such exercise was not carried out and the related information has not been disclosed in respect of earlier years.

Notes:

(a) The expenses for the above mentioned benefits have been included and disclosed under the following line items:- Gratuity – under 'Contribution to Provident and Other Funds' in Note 25.

Provident Fund – under 'Contribution to Provident and Other Funds' in Note 25, other than employees' statutory contributions, voluntary contributions etc. which are recovered from their salaries, as included under 'Salaries and Wages' in Note 25.

(b) The estimate of future salary increases takes into account inflation, seniority, promotion and other relevant factors, such as demand and supply in the employment market.

(c) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Company's policy for plan asset management and other relevant factors.

(II) Post Employment Defined Contribution Plans

During the year an amount of Rs. 571.71 Lakhs (Previous Year - Rs.500.53 Lakhs) has been recognised as expenditure towards defined contribution plans of the Company.

9. Disclosure pursuant to SEBI's circular No.SMD/POLICY/CIR-02/2003 -

(b) The Company has given loans and advances in the nature of loans to its employees for housing, medical etc. [balance outstanding as on 31st March, 2012 is Rs.213.00 Lakhs (Previous Year - Rs.147.64 Lakhs)] where, in some cases, the repayment schedule extends beyond seven years and interest is below the rate referred to in Section 372A of the Companies Act,1956. In view of the voluminous data, furnishing of required particulars by name, amount and maximum amount due in respect of such loans is not considered practicable.

10. Segment Information

A. Primary Segment Reporting (by Business Segments) i) Composition of Business Segments

The Company's operations predominantly relate to the following segments:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Other Miscellaneous Carbon and Graphite Products,

b) Power Segment engaged in generation of Power,

c) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

d) Other Segment, engaged in manufacturing of Impervious Graphite Equipment (IGE) and Glass Reinforced Pipes (GRP)

ii) Inter Segment Transfer Pricing

Inter Segment prices are normally negotiated amongst the segments with reference to the costs, market prices and business risks.

11. Related Party Disclosures:

(In accordance with Accounting Standard-18 prescribed under the Act)

(i) Related parties -

Name Relationship

(a) Where control exists:

Bavaria Carbon Holdings GmbH Subsidiary

Bavaria Carbon Specialities GmbH Subsidiary

Bavaria Electrodes GmbH Subsidiary

Carbon Finance Limited Subsidiary

Carbon International Holdings N.V. (Up to 13th March, 2012) Subsidiary

Graphite Cova GmbH Subsidiary

Graphite International B.V. Subsidiary

(b) Others:

Mr. M. B. Gadgil, Executive Director Key Management Personnel

Likhami Leasing Limited A Shareholder holding 28.60% Equity Shares of the Company

12. The Company has cancellable operating lease arrangements for certain accommodation with tenures of three years. Terms of such lease include option for renewal on mutually agreed terms. Operating lease rentals for the year debited to Profit and Loss Statement amount to Rs. 100.51 Lakhs (Previous Year - Rs. 99.94 Lakhs).

13. Research and Development Expenditure of revenue nature of Rs.24.87 Lakhs (Previous Year - Rs. 20.56 Lakhs).

14. The financial statements for the year ended 31st March, 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 31st March, 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified / regrouped 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.


Mar 31, 2011

1. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Honble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

2. The Company has entered into a Power Delivery agreement with Wardha Power Company Limited (WPCL) for procurement of power for its manufacturing activity at the terms set out in the said agreement for twenty five years from the commencement of commercial operation of power plant to be declared by WPCL. As per the terms of another related agreement with WPCL, the Company invested Rs. 247.66 Lakh (Previous Year – Rs. 24.77 Lakh) in its Class A Equity Shares and Rs. 312.34 Lakh (Previous Year – Rs. 312.34 Lakh) in its 0.01% Class A Redeemable Preference Shares, shown under Investments (Schedule 7) and advanced Rs. Nil (Previous Year – Rs. 222.89 Lakh) to WPCL against investment, shown under Loans and Advances (Schedule 12) and are required to subscribe Rs.350.00 Lakh to Class C Redeemable Preference Shares of WPCL prior to commencement of commercial operation of the said Power Plant. The aforesaid shares are/shall be under lien with WPCL.

Upon the expiry of Power Delivery agreement, Class A Equity Shares and Class A Redeemable Preference Shares will be bought back by WPCL for a total consideration of Re.1. One-tenth of Class C Redeemable Preference Shares will be redeemed on every anniversary from the date of issue at Re.0.01 per share.

3. a) Fixed Assets including Capital Work-in-Progress includes Pre-operative expenses : Salary, Wages & Bonus Rs. 51.79 Lakh (Previous Year – Rs. 8.31 Lakh), Contribution to Provident and Pension Funds Rs. 3.27 Lakh (Previous Year – Rs. 0.52 Lakh), Contribution to Superannuation Fund Rs. 4.03 Lakh (Previous Year – Rs. Nil), Staff Welfare Expenses Rs. Nil (Previous Year – Rs. 0.01 Lakh), Stores & Spare Parts Consumed Rs. 5.27 Lakh (Previous Year – Rs. 18.59 Lakh), Electricity Charges Rs. 2.60 Lakh (Previous Year – Rs. Nil), Other Repair Rs. Nil (Previous Year – Rs. 0.15 Lakh), Rates & Taxes Rs. 0.67 Lakh (Previous Year – Rs. Nil), Insurance Rs. 1.35 Lakh (Previous Year – Rs. Nil), Travelling & Conveyance Rs. 4.82 Lakh (Previous Year – Rs. 0.74 Lakh), Professional Charges Rs. 26.62 Lakh (Previous Year – Rs. 32.27 Lakh), Bank Charges Rs. 271.58 Lakh (Previous Year – Rs. 0.32 Lakh), Miscellaneous Expenses Rs. 2.96 Lakh (Previous Year – Rs. 0.52 Lakh) and Interest Expense Rs. 2.21 Lakh (net off Interest Income of Rs. 34.79 Lakh)(Previous Year – Rs. Nil).

The above particulars, as applicable, have been given in respect of MSEs to the extent they could be identified on the basis of the information available with the Company.

4. d) In respect of 1,19,32,742 Equity Shares of Rs. 2/- each allotted as fully paid up on conversion of Foreign Currency Convertible Bonds as indicated in Note 2 on Schedule 1 before the book closure date but after 31st March, 2010, dividend amounting to Rs. 417.65 Lakh (Previous Year – Rs. Nil) has been paid for the year ended 31st March, 2010.

5. Contingent Liabilities not provided in respect of –

(Rs. in Lakh) As at 31st As at 31st March, 2011 March, 2010

(I) Claims not acknowledged as debts :

(i) Disputed Excise Duty for which appeals are pending 394.01 398.42

(ii) Disputed Customs Duty for which appeals are pending 1,060.75 1068.97

(iii) Disputed Service Tax for which appeals are pending 218.23 304.89

(iv) Disputed Sales Tax for which appeals are pending 506.32 491.64

(v) Disputed Entry Tax for which appeals are pending 246.04 246.04

(vi) Others 295.79 390.04

6. Research and Development Expenditure of revenue nature of Rs. 20.56 Lakh (Previous Year - Rs. 29.62 Lakh)

7. Employee Benefits

(I) Post Employment Defined Benefit Plans

(A) Gratuity

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), makes payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employees salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 1(J)(b) above, based upon which, the Company makes contributions to the Employees Gratuity Funds.

(i) The estimate of future salary increases take into account inflation, seniority, promotion and other relevant factors.

(j) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Companys policy for plan asset management and other relevant factors.

(B) Provident Fund

Certain employees of the Company receive provident fund benefits, which are administered by the Provident Fund Trusts set up by the Company. Aggregate contributions along with interest thereon are paid at retirement, death, incapacitation or termination of employment. Both the employees and the Company make monthly contributions at specified percentage of the employees salary to such Provident Fund Trusts. The Company has an obligation to fund any shortfall in return on plan assets over the interest rates prescribed by the authorities from time to time.

In terms of the Guidance on implementing Accounting Standard 15 (Revised 2005) on Employee Benefits issued by the Accounting Standard Board of The Institute of Chartered Accountants of India (ICAI), a provident fund set up by the Company is defined benefit plan in view of the Companys obligation to meet shortfall, if any, on account of interest. Interest shortfall for the year has been provided for in these accounts.

Unlike earlier years, the Actuary has expressed his inability to provide an actuarial valuation of the provident fund as at the year-end in the absence of a Guidance Note from The Institute of Actuaries of India. Accordingly, complete information pertaining to the year required to be considered as per AS-15 in this regard are not available and the same could not be disclosed.

The Companys contribution to the aforesaid provident fund for the year amounting to Rs. 40.65 Lakh (31st March, 2010 – Rs. 31.85 Lakh) has been included in Contribution to Provident and Pension Funds in Schedule 16.

(II) Post Employment Defined Contribution Plans

During the year an amount of Rs. 500.53 Lakh (Previous Year - Rs.497.56 Lakh) has been recognised as expenditure towards defined contribution plan of the Company.

8. Disclosure pursuant to SEBIs circular No.SMD/POLICY/CIR-02/2003

b) The Company has given loans and advances in the nature of loans to its employees for housing, medical etc. [balance outstanding as on 31st March, 2011 is Rs.147.64 Lakh (Previous Year - Rs.140.61 Lakh)] where, in some cases, the repayment schedule extends beyond seven years and interest is below the rate referred to in Section 372A of the Companies Act,1956. In view of the voluminous data, furnishing of required particulars by name, amount and maximum amount due in respect of such loans is not considered practicable.

9. SEGMENT INFORMATION

A. Primary Segment Reporting (by Business Segments)

i) Composition of Business Segments

The Companys operations predominantly related to the following segments:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Anodes and other miscellaneous Carbon and Graphite Products,

b) Power Segment engaged in generation of Power,

c) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

d) Other Segment, engaged in manufacturing of Impervious Graphite Equipment (IGE) and Glass Reinforced Pipes (GRP)

ii) Inter Segment Transfer Pricing

Inter Segment prices are normally negotiated amongst the segments with reference to the costs, market prices and business risks.

10. RELATED PARTY DISCLOSURES :

(In accordance with Accounting Standard-18 prescribed under the Act)

i) Related Parties

Name Relationship

(a) Where control exists :

Bavaria Carbon Holdings GmbH Subsidiary

Bavaria Carbon Specialities GmbH Subsidiary

Bavaria Electrodes GmbH Subsidiary

Carbon Finance Limited Subsidiary

Carbon International Holdings N.V. Subsidiary

Graphite Cova GmbH Subsidiary

Graphite International B.V. Subsidiary

(b) Others :

Mr. M. B. Gadgil, Executive Director Key Management Personnel

11. The Company has cancellable operating lease arrangements for certain accommodation with tenures of three years. Terms of such lease include option for renewal on mutual agreed terms. Operating lease rentals for the year debited to Profit and Loss Account amount to Rs. 99.94 Lakh (Previous Year - Rs. 99.00 Lakh).

12. Previous Years figures have been re-grouped and/or re-arranged, wherever necessary.


Mar 31, 2010

1. Pending completion of the relevant formalities of transfer of certain assets and liabilities of Powmex Steels Undertaking of GKW Limited (GKW) acquired pursuant to the Scheme of Arrangement sanctioned by the Honble High Court at Calcutta vide Order of 22nd May, 2009, such assets and liabilities remain included in the books of the Company under the name of GKW (including another company, erstwhile Powmex Steels Limited, which was amalgamated with GKW in earlier years).

2. The Company has entered into a Power Delivery agreement with Wardha Power Company Limited (WPCL) for procurement of power for its manufacturing activity at the terms set out in the said agreement for twenty five years from the commencement of commercial operation of power plant to be declared by WPCL. As per the terms of another related agreement with WPCL, the Company invested/ advanced Rs.247.66 Lakh in the Class A Equity Shares fRs.24.77 Lakh shown under Investments (Schedule 7) and Rs.222.89 Lakh shown under Loans and Advances (Schedule 12)] and Rs.312.34 Lakh in 0.01% Class A Redeemable Preference Shares (shown under Investments in Schedule 7) of WPCL and are required to subscribe Rs.350.00 Lakh to Class C Redeemable Preference Shares of WPCL prior to commencement of commercial operation of the said Power Plant. The aforesaid shares are/shall be under lien with WPCL.

Upon the expiry of Power Delivery agreement, Class A Equity Shares and Class A Redeemable Preference Shares will be bought back by WPCL for a total consideration of Re.l. One-tenth of Class C Redeemable Preference Shares will be redeemed on every anniversary from the date of issue at Re.0.01 per share.

3. a) Fixed Assets including Capital Work-in-Progress includes Pre-operative expenses: Salary, Wages and Bonus Rs. 8,31 Lakh (Previous Year - Rs. Nil), Contribution to Provident and Pension Funds Rs. 0.52 Lakh (Previous Year - Rs. Nil), Other Repair Rs. 0.15 Lakh (Previous Year - Rs. Nil), Contractors Labour Charges Rs. Nil (Previous Year - Rs. 3.41 Lakh), Staff Welfare Expenses Rs. 0.01 Lakh (Previous Year - Rs. Nil), Travelling and Conveyance Rs. 0.74 Lakh (Previous Year - Rs. Nil), Rates and Taxes Rs. Nil (Previous Year - Rs. 12.59 Lakh), Professional Charges Rs. 32.27 Lakh (Previous Year - Rs. 46.81 Lakh), Stores and Spares Parts Consumed Rs. 18.59 Lakh (Previous Year - Rs. 16.28 Lakh)and Miscellaneous Expenses Rs.0.84 Lakh (Previous Year - Rs. 0.11 Lakh).

The above particulars, as applicable, have been given in respect of MSEs to die extent diey could be identified on the basis of the information available widi the Company and pursuant to amendment of Schedule VI to the Companies Act, 1956 (the Act) vide Notification dated 16th November, 2007 issued by the Central Government of India.

4. Contingent Liabilities not provided in respect of —

(Rs. in Lakh) As at As at 31st Match, 2010 31st March, 2009 I) Claims not acknowledged as debts (i) Disputed Excise Duty for which appeals are pending 398.42 423.57 (ii) Disputed Customs Duty for which appeals are pending 1068.97 999.62 (iii)Disputed Service Tax for which appeals are pending 304.89 309.76 (iv) Disputed Sales Tax for which appeals are pending 491.64 455.95 (v) Disputed Entry Tax for which appeals are pending 246.04 246.04 (vi) Others 390.04 172.22

II) Corporate Guarantees given to banks to secure the financial assistance/ accommodation extended to Subsidiary Companies 4537.50 5723.90

5. Research and Development Expenditure of revenue nature of Rs. 29.62 Lakh (Previous Year - Rs. 22.19 Lakh)

6. Employee Benefits

(I) Post Employment Defined Benefit Plans

Gratuity

The Company provides for gratuity, a defined benefit retirement plan covering eligible employees. As per the scheme, the Gratuity Fund Trusts, administered and managed by the Life Insurance Corporation of India (LICI), makes payment to vested employees at retirement, death, incapacitation or termination of employment, of an amount based on the respective employees salary and the tenure of employment. Vesting occurs upon completion of five years of service. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note l(J)(b) above, based upon which, the Company makes contributions to the Employees Gratuity Funds.

Provident Fund

Certain employees of the Company receive benefits from provident fund, which is a defined benefit plan and administered by the Trusts set up by the Company. Aggregate contributions along with interest thereon are paid at retirement, death, incapacitation or termination of employment. Both the employees and the Company make monthly contributions at specified percentage of the employees salary to such Provident Fund Trusts. The Company has an obligation to fund any shortfall in return on plan assets over the interest rates prescribed by the authorities from time to time.

(II) Post Employment Defined Contribution Plans

During the year an amount of Rs. 497.56 Lakh (Previous Year - Rs. 450.83 Lakh) has been recognised as expenditure towards defined contribution plan of the Company.

Figures in bracket relate to previous year.

b) The Company has given loans and advances in the nature of loans to its employees for housing, medical etc. [balance outstanding as on 31st March, 2010 is Rs.140.61 Lakh (Previous Year - Rs.161.61 Lakh)] where, in some cases, the repayment schedule extends beyond seven years and interest is below the rate referred to in Section 372A of the Companies Act,1956. In view of the voluminous data, furnishing of required particulars by name, amount and maximum amount due in respect of such loans is not considered practicable.

7. The net proceeds upon issue of Convertible Bonds as referred to in Schedule 4 has been utilised pardy during the year on overall basis as set out below:

8. SEGMENT INFORMATION

A. Primary Segment Reporting (by Business Segments) i) Composition of Business Segments

The Companys operations predominantly related to the following segments:

a) Graphite and Carbon Segment, engaged in the production of Graphite Electrodes, Anodes and other miscellaneous Carbon and Graphite Products,

b) Power Segment engaged in generation of Power,

c) Steel Segment engaged in production of High Speed Steel and Alloy Steel, and

d) Other Segment, engaged in manufacturing of Impervious Graphite Equipment (IGE) and Glass Reinforced Pipes (GRP)

ii) Inter Segment Transfer Pricing

Inter Segment prices are normally negotiated amongst the segments with reference to the costs, market prices and business risks.

9. The Company has cancellable operating lease arrangements for certain accommodation with tenures of three years. Terms of such lease include option for renewal on mutual agreed terms. Operating lease rentals for the year debited to Profit and Loss Account amount to Rs. 99.00 Lakh (Previous Year - Rs. 71.25 Lakh).

10. Previous Years figures have been re-grouped and/or re-arranged, wherever necessary.