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Notes to Accounts of Hinduja Ventures Ltd.

Mar 31, 2015

1. Rights, Preferences and Restrictions attached to equity shares:

i) Right to receive dividend as may be approved by the Board of Directors / Annual General Meeting.

ii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the 2013 Act.

iii) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to speak or e-vote and on a show of hands, has one vote if he is present and on a poll shall have the right to vote in proportion to his share of the paid-up capital of the Company.

2. Contingent liabilities in respect of:

(Rs. in Lacs)

Sr. Particulars As at As at No. 31.03.2015 31.03.2014

i. Income Tax matters against which the Company has filed appeals / objections. 7,326.65 14,229.00 (Refer Note 1 below)

ii. Summary Suit has been filed by Nishkalp Investments and Trading Company 867.12 867.12 Limited with regard to the dispute for buyback of shares of Plus Paper Foodpac Limited (PPFL) vide an agreement dated 25th November, 1997. The Management is of the opinion that the Company has a good case and the summary suit is not sustainable.

3. Includes an amount of Rs. 7,173.48 (in Lacs) [Previous Year - Rs. 12,209.79 (in Lacs)] being disputed income tax liabilities pertaining to IT / ITES business, which is reimbursable from Hinduja Global Solutions Limited, pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT / ITES business sanctioned by High Court of Judicature of Bombay and made effective on 7th March, 2007. In respect of the aforesaid disputed dues, an amount of Rs. 5,738.20 (in Lacs) [Previous Year - Rs. 6,069.41 (in Lacs)] has been deposited by the Company with income tax authorities under protest. The Company has received Rs. Nil (in Lacs) [Previous Year - Rs. 5,550.00 (in Lacs)] upto 31st March, 2015 from Hinduja Global Solutions Limited to discharge part payment of disputed income tax liabilities pertaining to IT / ITES business, which is netted from advance tax and tax deducted at source (net of provisions).

4. With respect to the above, the Company does not expect any outflow of cash / resources.

5. Other commitments:

a) IDL Speciality Chemicals Limited ('IDL'), a wholly owned subsidiary of the Company has outstanding Non-convertible debentures ('NCD') of Rs. 15,000 Lacs (Previous Year- Rs. 7,500 Lacs) redeemable at the end of 18 months from the date of allotment. The Company provided pledge of its investment of Nil (Previous year- 900,000) shares in Indusind Bank Limited and has given a shortfall undertaking to the debenture trustee that in the event of default by the subsidiary in redeeming the said debentures, the Company shall meet the shortfall, if any, to the investors of NCD.

b) IDL Speciality Chemicals Limited ('IDL'), a wholly owned subsidiary of the Company has, during the year, availed the Loan against share facility of Rs. 6,100 Lacs (Previous Year- Rs. 5,000 Lacs) from Axis Finance Limited ('AFL') repayable at the end of 36 months (Previous year- 12 months) from the date of disbursement. The Company provided pledge of its investment of Nil (Previous year- 965,000) shares in Indusind Bank Limited The Company has given shortfall undertaking that in the event of any shortfall in amount due and payable, the Company would infuse capital by way of subscription to equity/ preference shares to pay all amounts due and payable in relation to the loan in case IDL fails to do so and has also given a non-disposal undertaking of its shareholding in IDL.

c) IDL Speciality Chemicals Limited ('IDL'), a wholly owned subsidiary of the Company has, during the year, availed the Loan against share facility of Rs. 2,500 Lacs (Previous year- Rs. 5,000 Lacs) from Bajaj Finance repayable at the end of 12 months from the date of disbursement. The Company has given shortfall undertaking that in the event of any shortfall in amount due and payable, the Company would infuse capital by way of subscription to equity/ preference shares to pay all amounts due and payable in relation to the loan in case IDL fails to do so and also given a non-disposal undertaking of its shareholding in IDL.

d) IndusInd Media and Communications Limited ('IMCL'), subsidiary of the Company has, during the year, availed a short term loan of Rs. 4,000 lacs from Ratnakar Bank Limited ('RBL') repayable in a bullet payment at the end of 12 months from the date of disbursement. The Company has given shortfall undertaking to RBL that in the event of any shortfall in servicing the interest accrued and instalment on the loan by IMCL, the Company shall infuse such additional funds in IMCL by way of subscription to equity or unsecured or subordinated loans or deposits, which shall not involve any charge or lien on or other interest in the assets of IMCL.

e) Grant Investrade Limited ('Grant'), a wholly owned subsidiary of the Company has during the year availed the Loan against share facility of Rs. 29,500 Lacs from Yes Bank Limited (YBL) repayable after 96 months from the date of disbursement. The Company has given shortfall undertaking to YBL that in the event of any shortfall, the company will infuse additional equity in Grant towards time, cost overrun and losses during the tenure of the loan.

f) The Company has given an undertaking to various banks to retain shareholding to the extent of 51% in the subsidiary viz. IndusInd Media and Communications Limited ('IMCL') and 100% in the subsidiary viz. Grant Investrade Limited (Grant), until all amounts outstanding under various Facility Agreements entered into by IMCL and Grant with the said banks are repaid in full by IMCL and Grant respectively.

6. Operating leases

a) Where the Company is a lessee:

The Company has entered into cancellable leasing arrangement relating to office premises extending upto a maximum of five years from the respective date of inception which are renewable on mutual consent. Lease rental of Rs. 109.81 (in Lacs) [Previous Year - Rs. 87.52 (in Lacs)] has been included in 'Rent' - Refer Note 22 of the financial statements.

b) Where the Company is a lessor:

The Company has given optical fibre cable under operating lease. These are generally cancellable and are renewable by mutual consent on mutually agreeable terms. With effect from October 1,2013 the agreement is temporarily suspended by mutual consent. The lease income recognised in the Statement of Profit and Loss under lease income - optical fibre cable is Rs. Nil (in Lacs) [Previous Year - Rs. 218.66 (in Lacs)] - Refer Note 17 of the financial statements.

7. MAT credits

The Company has recognised Minimum Alternate Tax (MAT) credit as per the provisions of section 115JAA of the Income Tax Act, 1961 in the current year, which can be carried forward for a period of ten years and set-off against the tax payable when the Company will fall under the normal tax rate. The convincing evidence of obtaining tax credit is supported by subsequent performance of the Company and subsisting business, which will ensure availability of sufficient future taxable income against which the above MAT credit will be adjusted.

8. Segment reporting Primary Segment

In accordance with Accounting Standard 17 - Segment Reporting, the Management has identified its business segments based on the nature of services, nature of risks and returns as applicable to each segment and the internal financial reporting systems, so far as they relate to the specific groups included in the segments, which are as under:

a. Media and communications - consists of various media / communication related activities spearheaded by the Corporate Group. This segment also includes all activities relating to increase in shareholders' value in subsidiaries belonging to the Company in this sector.

b. Real estate - The Company has real estate activities in the form of property development. The segment also identifies potential investment opportunities in real estate properties either itself or through participation in the form of shares or securities of real estate companies.

c. Investments and Treasury - This segment consists of activities relating to

i. Deployment of surplus funds and

ii. Existing stock in trade / investments in shares and securities, other than subsidiaries.

Revenue and expenses have been accounted for on the basis of their relationship to the operating activities of the segment. Expenses, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated corporate expenses ". Assets and Liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated corporate assets / liabilities ".

Secondary Segment

There is no reportable Geographical Segment.

9. Related party disclosures (as identified by the Management)

I. Individual having control with relatives and associates Mr. Ashok P. Hinduja, Executive Chairman

II. Subsidiaries

A) Direct Subsidiaries

1. IndusInd Media & Communications Limited

2. Grant Investrade Limited

3. IDL Speciality Chemicals Limited

B) Indirect Subsidiaries

1. USN Networks Private Limited

2. Gold Star Noida Network Private Limited

3. Seven Star Information Technology Private Limited

4. Bhima Riddhi Infotainment Private Limited

5. United Mysore Network Private Limited

6. Apna Incable Broadband Services Private Limited

7. Sangli Media Services Private Limited

8. Sainath In Entertainment Private Limited

9. Sunny Infotainment Private Limited

10. Goldstar Infotainment Private Limited

11. Ajanta Sky Darshan Private Limited

12. V4U Entertainment Private Limited

13. Darpita Trading Company Private Limited

14. RBL Digital Cable Network Private Limited

15. Vistaar Telecommunication and Infrastructure Private Limited

16. Jagsumi Perspectives Private Limited (upto 31st December, 2014)

17. Advance Multisystem Broadband Communications Limited

III. Associates

1. Planet E-Shop Holdings India Limited

2. IN Entertainment (India) Limited

IV. Key Management Personnel

1. Mr. Ashok Mansukhani, Whole-Time Director

V. Enterprises where common control exists

1. Hinduja Group Limited

2. Aasia Advisory Services Limited

3. Hinduja Realty Ventures Limited

4. Hinduja Global Solutions Limited

5. APDL Estates limited

6. Hinduja National Power Corporation Limited

7. Hinduja Energy (India) Limited

10. Disclosure in accordance with Accounting Standard 15 'Employee Benefits'

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

I Defined Contribution Plans

a) Provident fund

b) State defined contribution plans

i) Employer's contribution to employees state insurance

ii) Employer's contribution to employees pension scheme 1995

11. As part of its Real estate activity, the Company had acquired approximately 47 acres of land in Devanahalli, Bengaluru from a party in terms of Agreement of Sale Deed dated 28.7.1995. However, as the said party, though in receipt of sales consideration, did not fulfill its legal obligation to transfer the title in the name of the Company, the Company filed a suit for specific performance in the Civil Court in 2011. An Order granting temporary injunction was passed on 11.3.2013 restraining the said party from alienating or in any way encumbering the land in Devanahalli. A criminal complaint was also filed at the Devanahalli Court on 10.11.2014 and investigations in this regard are in progress.

12. The Company had obtained registration as a sub-broker of the National Stock Exchange of India Limited and Bombay Stock Exchange Limited from Securities and Exchange Board of India. The Company is engaged in the activity of sub-broking during the year. In the opinion of the Management and based on a legal opinion, the Company is not considered as a Non-Banking Financial Company as per the guidelines issued by Reserve Bank of India.

13. During the year, pursuant to the notification of Schedule II to the Companies Act, 2013 with effect from April 1, 2014, the Company revised the estimated useful life of its assets to align the useful life with those specified in Schedule II.

The depreciation expense in the Statement of Profit and Loss for the year is lower by Rs. 110.32 Lacs consequent to the change in the useful life of the assets.

14. The Company has not received any intimation from the "suppliers " regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence the disclosures relating to amount unpaid as at the end of the year together with interest paid/payable as required under the said Act has not been furnished and provision for interest, if any, on delayed payments, is not ascertainable at this stage.

15. The Board of Directors of the Company (Board) at their meeting held on April 24, 2015 declared an interim dividend of Rs. 15 per share for the financial year 2014-15. The Company has obtained an independent legal advice to the effect that it would be permissible for the Board to declare an interim dividend after the Balance Sheet date so long as it is declared out of the profits of the financial year to which it relates. Accordingly, the Company has recognised a liability for the interim dividend and the related tax aggregating to Rs. 3,699.81 lacs as of March 31, 2015 in the financial statements.

16. Previous Year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Mar 31, 2014

1 (A) Contingent liabilities in respect of:

(Rs in Lacs) Sr. Particulars As at As at No. 31.03.2014 31.03.2013

i.Income Tax matters against which the Company has fled appeals / objections. 14,229.00 20,749.21 (Refer Note 1 below).

ii.Summary Suit has been fled by Nishkalp Investments and Trading Company 867.12 867.12 Limited with regard to the dispute for buyback of shares of Plus Paper Foodpac Limited (PPFL) vide an agreement dated 25th November, 1997. The Management is of the opinion that the Company has a good case and the summary suit is not sustainable.

Notes:

1. Includes an amount of R 12,209.79 (in Lacs) [Previous Year - R 18,274.29 (in Lacs)] being disputed income tax liabilities pertaining to IT / ITES business, which is reimbursable from Hinduja Global Solutions Limited, pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT / ITES business sanctioned by High Court of Judicature of Bombay and made effective on 7th March, 2007. In respect of the aforesaid disputed dues, an amount of R 6,069.41 (in Lacs) [Previous Year - R 4,397.12 (in Lacs)] has been deposited by the Company with income tax authorities under protest. The Company has received R 5,550.00 (in Lacs) [Previous Year - R 3,750.00 (in Lacs)] upto 31st March, 2014 from Hinduja Global Solutions Limited to discharge part payment of disputed income tax liabilities pertaining to IT / ITES business, which is netted from advance tax and tax deducted at source (net of provisions).

2. With respect to the above, the Company does not expect any outflow of cash / resources.

(B) Other commitments:

a) IDL Speciality Chemicals Limited (''IDL''), a wholly owned subsidiary of the Company has outstanding Non–convertible debentures (''NCD'') of R 7,500 Lacs [Previous Year - R 25,000 Lacs] redeemable at the end of 18 months from the date of allotment. The Company has provided pledge of its investment of 9,00,000 shares in IndusInd Bank Limited and also a shortfall undertaking to the debenture trustee, that in the event of default by the subsidiary in redeeming the said debentures, the Company shall meet the shortfall, if any, to the investors of NCD.

b) IDL Speciality Chemicals Limited (''IDL''), a wholly owned subsidiary of the Company has during the year availed the Loan against share facility of R 5,000 Lacs from Axis Finance Limited (''AFL'') repayable at the end of 12 months from the date of disbursement. The Company has provided pledge of its investment of 9,65,000 shares in IndusInd Bank Limited. The Company has given shortfall undertaking to pay all amounts due and payable in relation to the loan in case IDL fails to do so and also given a non-disposal undertaking of its shareholding in IDL.

c) IN Entertainment (India) Limited (''INEL''), an associate of the Company has during the year availed the Loan against share facility of R 4,500 Lacs from Axis Finance Limited (''AFL'') repayable at the end of 12 months from the date of disbursement. The Company has also given shortfall undertaking to pay all amounts due and payable in relation to the loan in case INEL fails to do so.

d) The Company has given an undertaking to various banks to retain shareholding to the extent of 51% in the subsidiary viz. IndusInd Media & Communications Limited (''IMCL'') until all amounts outstanding under various Facility Agreements entered into by IMCL with the said banks are repaid in full by IMCL.

3 Operating leases

a) Where the Company is a lessee:

The Company has entered into cancellable leasing arrangement relating to office premises extending upto a maximum of five years from the respective date of inception which are renewable on mutual consent. Lease rental of R 87.52 (in Lacs) [Previous Year - R 87.52 (in Lacs)] has been included in ''Rent'' - Refer Note 21 of the financial statements.

b) Where the Company is a lessor:

The Company has given optical fbre cable under operating lease. These are generally cancellable and are renewable by mutual consent on mutually agreeable terms. With effect from October 1, 2013 the agreement is temporarily suspended by mutual consent. The lease income recognised in the Statement of Profit and Loss under lease income - optical fbre cable of R 218.66 (in Lacs) [Previous Year - R 437.30 (in Lacs)] - Refer Note 17 of the financial statements.

4 MAT credits

The Company has recognised Minimum Alternate Tax (MAT) credit as per the provisions of section 115JAA of the Income Tax Act, 1961 in the current year, which can be carried forward for a period of ten years and set-off against the tax payable when the Company will fall under the normal tax rate. The convincing evidence of obtaining tax credit is supported by subsequent performance of the Company and subsisting business, which will ensure availability of suffcient future taxable income against which the above MAT credit will be adjusted.

5 Segment reporting Primary Segment

In accordance with Accounting Standard 17 - Segment Reporting, the Management has identified its business segments based on the nature of services, nature of risks and returns as applicable to each segment and the internal financial reporting systems, so far as they relate to the Specific groups included in the segments, which are as under:

I. Media and communications - consists of various media / communication related activities spearheaded by the Corporate Group. This segment also includes all activities relating to increase in shareholders'' value in subsidiaries belonging to the Company in this sector.

II. Real estate - The Company has real estate activities in the form of property development. The segment also identifes potential investment opportunities in real estate properties either itself or through participation in the form of shares or securities of real estate companies.

III. Investments and Treasury - This segment consists of activities relating to i. Deployment of surplus funds and

ii. Existing stock in trade / investments in shares and securities, other than subsidiaries.

Revenue and expenses have been accounted for on the basis of their relationship to the operating activities of the segment. Expenses, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated corporate expenses". Assets and Liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated corporate assets / liabilities".

Secondary Segment

There is no reportable Geographical Segment.

6 Related party disclosures (as identified by the Management)

I. Individual having control with relatives and associates

Mr. Ashok P. Hinduja, Executive Chairman

II. Subsidiaries

A) Direct Subsidiaries

1. IndusInd Media & Communications Limited

2. Grant Investrade Limited

3. IDL Speciality Chemicals Limited

B) Indirect Subsidiaries

1. USN Networks Private Limited

2. Gold Star Noida Network Private Limited

3. Seven Star Information Technology Private Limited

4. Bhima Riddhi Infotainment Private Limited

5. United Mysore Network Private Limited

6. Apna Incable Broadband Services Private Limited

7. Sangli Media Services Private Limited

8. Sainath In Entertainment Private Limited

9. Sunny Infotainment Private Limited

10. Goldstar Infotainment Private Limited

11. Ajanta Sky Darshan Private Limited

12. V4U Entertainment Private Limited

13. Darpita Trading Company Private Limited

14. RBL Digital Cable Network Private Limited

15. Vistaar Telecommunication and Infrastructure Private Limited

16. Jagsumi Perspectives Private Limited

17. Advance Multisystem Broadband Communications Limited

III. Associates

1. Planet E-Shop Holdings India Limited

2. IN Entertainment (India) Limited

IV. Key Management Personnel

1. Mr. Ashok Mansukhani, Whole-Time Director (effective from 30th April, 2012)

2. Mr. Dilip Panjwani, Director and Company Secretary (upto 30th April, 2012)

V. Enterprises where common control exists

1. Hinduja Group Limited (formerly known as Aasia Management and Consultancy Private Limited)

2. Aasia Advisory Services Limited (formerly known as Hinduja Group India Limited)

3. Hinduja Realty Ventures Limited

4. Hinduja Global Solutions Limited

5. APDL Estates Limited

6. Hinduja National Power Corporation Limited

7. Hinduja Energy (India) Limited

Note: A. Figures in brackets are in respect of the previous year.

B. During the year the Company has converted an amount of R 20,000.00 lacs of Inter Corporate Deposits into 1% Participatory Redeemable Non-Cumulative preference shares of R 10 each at a premium of R 990/- per share.

29 Disclosure in accordance with Accounting Standard 15 (Revised 2005) ''Employee benefits''

The Company has classifed various benefits provided to employees as under:

I Defined Contribution Plans

a) Provident fund

b) State Defined contribution plans

i) Employer''s contribution to employees'' state insurance ii) Employer''s contribution to employees'' pension scheme 1995 During the year, the Company has recognised the following amounts in the Statement of Profit and Loss:

* Included in contribution to employees provident and other funds - Refer Note 19 of the financial statements.

II Defined benefit Plan

Gratuity

In accordance with Accounting Standard 15 (Revised 2005), actuarial valuation was carried out in respect of the aforesaid Defined benefit plan of gratuity based on the following assumptions:

* Represents liability discharged in respect of employees transferred to group companies.

B) Reconciliation of Present Value of Defined benefit Obligation and the Fair Value of Assets

* Included in provisions – Refer Note 5 & 8 of the financial statements.

* Included in employee benefits expenses - Refer Note 19 of the financial statements.

The liability for leave encashment and compensated absences as at 31st March, 2014 aggregates r 6.21 (in Lacs) [Previous Year - r 10.48 (in Lacs)].

The estimates of future salary increases considered in actuarial valuation, take account of Infation, seniority, promotion, and other relevant factor, such as supply and demand in the employment market.

7 Unhedged foreign currency exposure

The year-end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are as given below:

Amount payable in foreign currency on account of the following:

- Loans and advances, in the nature of loans to subsidiaries and associates as shown above are repayable on demand.

- There are no other loans and advances in the nature of loans where there is no repayment schedule.

- Loans and advances to employees and investment by such employees in the shares of the Company, if any are excluded from the above disclosure.

8 As part of its Real estate activity the Company acquired approximately 47 acres of land in Bengaluru from a party in terms of an Agreement to sell. However in view of the fact that the said party, though is in receipt of sales consideration, has not fulfilled his part of the obligation by transferring the title to the said land in the name of the Company, the Company has fled a suit in a civil court in Bengaluru for Specific performance of the Agreement of sale so as to have proper conveyance to the said property in favour of the Company.

9 The Company had obtained registration as a sub-broker of the National Stock Exchange of India Limited and Bombay Stock Exchange Limited from Securities and Exchange Board of India. The Company is engaged in the activity of sub-broking during the year. In the opinion of the Management and based on a legal opinion, the Company is not considered as a Non-Banking Financial Company as per the guidelines issued by Reserve Bank of India.

10 Previous Year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classifcation / disclosure.


Mar 31, 2013

1 (A) Contingent liabilities in respect of:

(Rs. in Lacs)

Sr. Particulars As at As at No 31.03.2013 31.03.2012

i. Corporate Guarantee provided by the Company for loan taken by IDL Speciality - 4,500.00 Chemicals Limited, a wholly owned subsidiary of the Company.

ii. Corporate Guarantee provided by the Company for loan taken by IN - 3,000.00 Entertainment (India) Limited, an associate of the Company.

iii. Income Tax matters against which the Company has filed appeals / objections. 20,749.21 17,784.30 (Refer Note 1 below).

iv. Summary Suit has been filed by Nishkalp Investments and Trading Company 867.12 867.12 Limited with regard to the dispute for buyback of shares of Plus Paper Foodpac

Limited (PPFL) vide an agreement dated 25th November, 1997. The Management is of the opinion that the Company has a good case and the summary suit is not sustainable.

Notes:

1. Includes an amount of Rs.18,274.29 (in Lacs) [Previous Year - Rs. 16,662.50 (in Lacs)] being disputed income tax liabilities pertaining to IT / ITES business, which is reimbursable from Hinduja Global Solutions Limited, pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT / ITES business sanctioned by High Court of Judicature of Bombay and made effective on 7th March, 2007. In respect of the aforesaid disputed dues, an amount of Rs.4,397.12 (in Lacs) [Previous Year - Rs.4,397.12 (in Lacs)] has been deposited by the Company with income tax authorities under protest. The Company has received Rs. 3,750.00 (in Lacs) [Previous Year - Rs.3,750.00 (in Lacs)] upto 31st March, 2013 from Hinduja Global Solutions Limited to discharge part payment of disputed income tax liabilities pertaining to IT / ITES business, which is netted from advance tax and tax deducted at source (net of provisions).

2. With respect to the above, the Company does not expect any outflow of cash / resources.

(B) Other commitments:

a) IDL Speciality Chemicals Limited (‘IDL''), a wholly owned subsidiary of the Company has during the year issued Non-convertible debentures (‘NCD'') of Rs.25,000 Lacs redeemable at the end of 18 months from the date of allotment. The Company has provided pledge of its investment of 5,50,000 shares in IndusInd Bank Limited and also a shortfall undertaking to the debenture trustee, that in the event of default by the subsidiary in redeeming the said debentures, the Company shall meet the shortfall, if any, to the investors of NCD.

b) IN Entertainment (India) Limited (‘INEL''), an associate of the Company has during the year availed the Loan against Share facility of '' 7,500 Lacs from Kotak Mahindra Prime Limited (‘KMPL'') repayable at the end of 18 months from the date of disbursement. The Company has provided pledge of its investment of 15,00,000 shares in IndusInd Bank Limited and also an undertaking to KMPL for the replenishment of margins in case INEL fails to maintain the margins stipulated in the loan agreement during the tenor of loan.

c) The Company has given an undertaking to a bank to retain shareholding to the extent of 61.71% in the subsidiary viz; IndusInd Media & Communications Limited (‘IMCL'') until all amounts outstanding under various Facility Agreements entered into by IMCL with the said Bank are repaid in full by IMCL.

2 Operating leases

a) Where the Company is a lessee:

The operating lease arrangement relating to office premises extend upto a maximum of five years from the respective date of inception and are renewable on mutual consent. In addition, the Company has entered into cancellable leasing arrangements for office premises and towards which the lease rental of Rs.87.52 (in Lacs) [Previous Year - Rs. 90.39 (in Lacs)] has been included in ‘Rent'' - Refer Note 23 of the financial statements.

b) Where the Company is a lessor:

The Company has given optical fibre cable under operating lease. These are generally cancellable and are renewable by mutual consent on mutually agreeable terms. The lease income recognised in the Statement of Profit and Loss under lease income - optical fibre cable of Rs.437.30 (in Lacs) [Previous Year - Rs.583.07 (in Lacs)] - Refer Note 17 of the financial statements.

3 Inter-corporate deposits

Inter-corporate deposit aggregating Rs.5,295.00 (in Lacs) [Previous Year - Rs.9,700.00 (in Lacs)] granted to Hinduja Realty Ventures Limited is secured by way of pledge of equity shares of Juhu Beach Resort Limited held by that company.

4 MAT credits

The Company has recognised Minimum Alternate Tax (MAT) credit as per the provisions of section 115JAA of the Income Tax Act, 1961 in the current year, which can be carried forward for a period of ten years and set-off against the tax payable when the Company will fall under the normal tax rate. The convincing evidence of obtaining tax credit is supported by subsequent performance of the Company and subsisting business, which will ensure availability of sufficient future taxable income against which the above MAT credit will be adjusted.

5 Segment reporting Primary Segment

In accordance with Accounting Standard 17 - Segment Reporting, the Management has identified its business segments based on the nature of services, nature of risks and returns as applicable to each segment and the internal financial reporting systems, so far as they relate to the specific groups included in the segments, which are as under:

I. Media and communications - consists of various media / communication related activities spearheaded by the Corporate Group. This segment also includes all activities relating to increase in shareholders'' value in subsidiaries belonging to the Company in this sector.

II. Real estate - The Company has real estate activities in the form of property development. The segment also identifies potential investment opportunities in real estate properties either itself or through participation in the form of shares or securities of real estate companies.

III. Treasury - This segment consists of activities relating to

i. Deployment of surplus funds; and

ii. Existing stock in trade / investments in shares and securities, other than subsidiaries.

Revenue and expenses have been accounted for on the basis of their relationship to the operating activities of the segment. Expenses, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocable Corporate Expenses". Assets and Liabilities, which relate to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocable Corporate Assets / Liabilities".

Secondary Segment

There is no reportable Geographical Segment.

6 Related party disclosures (as identified by the Management)

I. Individual having control with relatives and associates

Mr. Ashok P. Hinduja, Executive Chairman

II. Subsidiaries

A) Direct Subsidiaries

1. IndusInd Media & Communications Limited

2. Grant Investrade Limited

3. IDL Speciality Chemicals Limited

B) Indirect Subsidiaries

1. USN Networks Private Limited

2. Gold Star Noida Network Private Limited

3. Seven Star Information Technology Private Limited

4. Bhima Riddhi Infotainment Private Limited

5. United Mysore Network Private Limited

6. Apna Incable Broadband Services Private Limited

7. Sangli Media Services Private Limited

8. Sainath In Entertainment Private Limited

9. Sunny Infotainment Private Limited

10. Goldstar Infotainment Private Limited

11. Ajanta Sky Darshan Private Limited

12. V4U Entertainment Private Limited

13. Darpita Trading Company Private Limited

14. RBL Digital Cable Network Private Limited

15. Vistaar Telecommunication and Infrastructure Private Limited

16. Jagsumi Perspectives Private Limited

17. Advance Multisystem Broadband Communications Limited (effective 9th November, 2012)

III. Associates

1. Planet E-Shop Holdings India Limited

2. IN Entertainment (India) Limited

IV. Key Management Personnel

1. Mr. Ashok Mansukhani, Whole-Time Director (effective from 30th April, 2012)

2. Mr. Dilip Panjwani, Director and Company Secretary (upto 30th April, 2012)

V. Enterprises where common control exists

1. Aasia Management and Consultancy Private Limited

2. Hinduja Group India Limited

3. Hinduja Realty Ventures Limited

4. Hinduja Global Solutions Limited

5. APDL Estates Limited

6. Hinduja National Power Corporation Limited

7. Hinduja Energy (India) Limited

7 Disclosure in accordance with Accounting Standard 15 (Revised 2005) ‘Employee Benefits''

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

I Defined Contribution Plans

a) Provident fund

b) State defined contribution plans

i) Employer''s contribution to employees'' state insurance

ii) Employer''s contribution to employees'' pension scheme 1995

- Loans and advances, in the nature of loans to subsidiaries and associates as shown above are repayable on demand.

- There are no other loans and advances in the nature of loans where there is no repayment schedule.

- In respect of the loan of Rs.23,133 Lacs (Previous Year Rs.22,148.00 Lacs) given to IDL Speciality Chemicals Limited and loan of Rs.18,755 Lacs (Previous Year Rs.5,002.00 Lacs) to Grant Investrade Limited, wholly owned subsidiaries of the Company, no interest is charged. However the provisions of Section 372A of the Companies Act, 1956 are not applicable to these loans in view of the loanees been wholly owned subsidiaries of the Company.

- Loans and advances to employees and investment by such employees in the shares of the company, if any are excluded from the above disclosure.

8 As part of its Real estate activity the Company acquired approximately 47 acres of land in Bengaluru from a party in terms of an Agreement to sell. However in view of the fact that the said party, though is in receipt of sales consideration, has not fulfilled his part of the obligation by transferring the title to the said land in the name of the Company, the Company has filed a suit in a civil court in Bengaluru for specific performance of the Agreement of Sale so as to have proper conveyance to the said property in favour of the Company.

9 The Company had obtained registration as a sub-broker of the National Stock Exchange of India Limited and Bombay Stock Exchange Limited from Securities and Exchange Board of India. The Company is engaged in the activity of sub-broking during the year. In the opinion of the Management and based on a legal opinion, the Company is not considered as a Non-Banking Financial Company as per the guidelines issued by Reserve Bank of India.

10 Previous Year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

 
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