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Notes to Accounts of JK Paper Ltd.

Mar 31, 2016

Note:

Working Capital Borrowings are secured by hypothecation of Raw Materials, Finished Goods,
Stock-in-Process, Stores & Spares and Book Debts. The same are further secured by a second charge
on the movable and immovable assets of the Company.


29. Estimated amount of (i) contracts remaining to be executed on capital account (Net of Advances)
are Rs. 4.69 Crore (Previous year Rs. 5.12 Crore), (ii) Balance of Investment committed Rs. 2.41
Crore (Previous year Rs. 2.41 Crore) and, (iii) Export commitments against import of capital goods
under EPCG scheme Rs. 585.65 Crore (Previous year Rs. 747.52 Crore).

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are
pending before the Appellate Authorities and adjustment, if any, will be made after the same are
finally determined.

1. In respect of levy of Octroi pertaining to Unit- CPM by Songadh Group Gram Panchayat, the
Company has paid Rs. 1.25 Crore till 31st March 1997 under protest and also created a liability of
the similar amount. As the matter is still pending in the court of law, the necessary adjustment,
if any, would be made after its disposal.

2. The Company has only one business segment i.e. Paper and Boards and geographical reportable
segment i.e. Operations mainly within India, hence Segment Reporting as defined in Accounting
Standard (AS - 17) is not required.

3. a) Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - CPM were revalued as on
30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and
Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.03.1994 based
on current replacement cost by the approved valuers appointed for the purpose. As a result, the
book value of such assets has been increased by Rs. 42.27 Crore, which has been transferred to
Revaluation Reserve during the year ended 31.03.1994.

b) The Assets of Rs. 157.57 Crore (Previous year Rs. 157.84 Crore) held for sale , disclosed under
the heading of "Other Current Assets" consists of Old Pulp Mill, Recovery Island , Power Block (
Coal Fired Boilers &TG Sets) and Old Lime Klin Plant based on lower of Written down value and
estimated Net Realizable Value. The Management is actively pursuing for disposal of these assets.

4. a) Long Term Loans and Advances include concessional loan of Rs. Nil (previous year Rs. 18.98
crore). Short Term Loans and Advances include concessional loan of Rs.18.98 Crore (previous year
Rs. Nil), Normal loan of Rs. 2.00 Crore (Previous year Rs. 2.00 Crore) to JK Paper Employees''
Welfare Trust, a shareholder of the Company, and loan to employees of Rs. 0.80 Crore (Previous year
Rs. 0.37 Crore) in the ordinary course of business and as per service rules of the Company.

b) Long Term Loans and Advances includes loan of Rs. 35.50 Crore (previous year Rs. 36.50 crore)
and Short Term Loans and Advances includes loan of Rs. 1.00 Crore (Previous year Rs. 1.00 Crore) to
Housing Subsidiaries for general corporate purpose and loan of Rs. 1.00 Crore (Previous year Rs.
Nil) to JK Enviro-Tech Ltd for general business purpose.

c) Advances recoverable in cash or in kind or for value to be received under " Short Term Loan and
Advances" in Note No. 19 .includes Rs. 6.90 Crore ( Previous Year Rs. 4.73 Crore) payments made for
various development projects being undertaken by the Company. The same will be adjusted once these
projects are finalized.

5. a) Sales include export incentives of Rs. 9.06 Crore (Previous year Rs. 6.38 Crore).

b) Discount includes Trade Discount Rs 69.79 Crore (Previous year Rs. 63.42 Crore).


b) Defined Benefit Plans -

Gratuity Expense Rs. 5.01 Crore (Previous year Rs. (-) 1.74 Crore) has been recognized in
"Salaries, Wages, Bonus and Gratuity etc." under Note 25.

Amount recognized as an expense and included in Note 25 & Note 44 below, Item "Contribution to
Provident and Other Funds" Rs. 7.22 Crore (Previous year Rs. 7.21 Crore).

c) Defined Contribution Plans -

Amount recognized as an expense and included in Note 25 Item "Contribution to Provident and Other
Funds" Rs. 1.19 Crore (Previous year Rs. 1.21 Crore) for Superannuation Fund.

d) Other long-term benefits -

Amount recognized as an expense and included in Note 25 Item "Salaries, Wages, Allowances etc."
Rs.2.43 Crore (Previous year Rs. 1.98 Crore) for long term compensated Absences.

e) The expected return on plan assets is determined considering several applicable factors mainly
the composition of the plan assets held, assessed risk of assets management, historical results on
plan assets and the policy for plan assets management.

f) The estimates of future salary increase, considered in actuarial valuation, after taking account
of inflation, seniority, promotion and other relevant factors, such as supply and demand in the
employment market.

6. Interest Income includes Rs. 0.65 Crore (Previous year Rs 0.53 Crore) on Deposits with Banks,
Rs. 0.01 Crore (Previous year Rs.0.22 Crore) on Income Tax refund and Rs.8.25 Crore (Previous year
Rs. 7.91 Crore) on others.

7. a) Future minimum lease payments under non-cancelable operating leases as on 31st March, 2016
are Rs. 36.03 Crore - Rs. 6.18 Crore within one year and Rs. 24.70 Crore later than one year but
not later than five years and Rs. 5.15 Crore after Five year (Previous year Rs. 42.20 Crore - Rs.
6.18 Crore within one year- Rs. 24.70 Crore later than one year but not later than five years and
Rs. I 1.32 Crore after Five year).

b) Future minimum lease payments under non-cancelable Finance leases as on 31st March, 2016 are Rs.
0.35 Crore - Rs. 0.35 Crore within one year and Rs. Nil later than one year but not later than five
years (Previous year Rs. 0.82 Crore - Rs. 0.47 Crore within one year and Rs. 0.35 Crore later than
one year but not later than five years) and their present value as on 31st March, 2016 are Rs. 0.34
Crore - Rs. 0.34 Crore within one year and Rs. Nil later than one year but not later than five year
(Previous year Rs.0.76 Crore - Rs. 0.42 Crore within one year and Rs. 0.34 Crore later than one
year but not later than five year).

8. Based on information so far available in respect of MSME (as defined in The Micro Small &
Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises
during the year and there is no such dues payable at the end of the period.


9. Consumption of Stores, Spares is net of scrap sale of Rs. 6.62 Crore (Previous year Rs. 6.62
Crore).

10. a) In accordance with Announcement issued by the Institute of Chartered Accountants of India
all outstanding

Derivatives except those covered under AS I I (revised 2003) are marked to market on Balance Sheet
date and there is gain of Rs. 0.32 Crore - reversal of previously recognized MTM Losses (Previous
year gain of Rs. 0.36 Crore - reversal of previously recognized MTM Losses) which has been
recognized in Statement of Profit and Loss.

* Net of Receivables USD 3.10 Million - Rs. 20.55 Crore (Previous year USD 3.45 Million - Rs. 21.59
Crore) and GBP Nil - Rs. Nil (Previous year GBP 0.04 Million -Rs.0.36 Crore).


11. a) Pursuant to the Accounting Standard (AS 22) - ''Accounting for Taxes on Income'', deferred tax
(liability)/asset at Balance Sheet date is:

b) Based on the past performance and current plans, the Company expects to continue to generate
taxable income which will enable it to utilize MAT credit entitlement.

c) During the current year the Company has provided Current Tax Rs. 38,21 I/- (Previous year Rs.
Nil) and also reversed MAT credit Entitlement of Rs. Nil (previous year Rs. 1.29 Crore) related to
earlier years.


Key Management Personnel (KMP) :

The remuneration paid to Vice Chairman & Managing Director Rs. 5.39 Crore (Previous year Rs. 3.03
Crore) and Whole Time Director Rs. 2.40 Crore (Previous year Rs. 1.76 Crore).The remuneration paid
to Chief Finance Officer Rs. 1.50 Crore (Previous year Rs. 1.15 Crore) and Company Secretary Rs.
0.45 Crore (Previous year Rs. 0.36 Crore).The above said remuneration is excluding provision for
Gratuity & Leave Encashment, where the actuarial valuation is done on overall Company basis.


12. The Company had allotted 1,19,10,000 Equity Shares of Rs. 10/- each on preferential basis to
the Promoter and constituents of the Promoter Group for cash at a price of Rs.42/- each (including
a premium of Rs. 32/- each) on 16th September,20l5.The proceeds of the said issue have been used
towards augmenting the Net Worth of the Company.

13. Several High Courts have stayed the retrospective nature of amendment in The Payment of Bonus
Act (Amendment), 2015 with effect from 1st April, 2014. The Company has consequently not made any
provision for Bonus for the year 2014-15 (Rs. 3.45 Crore) in the current financial year.


14. Pursuant to the Scheme of Arrangement sanctioned by the Hon''ble High Court of Gujarat under
section 391 to 394 of the Companies Act 1956, w.e.f I Oth April 2015, there was diminution in value
of the investments made in the shares of JK Enviro-Tech Limited of Rs. 5.04 Crore in Previous year.

15. Previous year''s figures have been re-grouped/re-arranged wherever necessary.


Mar 31, 2015

1. Estimated amount of (i) contracts remaining to be executed on capital account (Net of Advances) Rs. 5.12 Crore (Previous year Rs. 27.19 Crore), (ii) Investment Rs. 2.41 Crore (Previous year Rs. 5.40 Crore) and, (iii) Export commitments against import of capital goods under EPCG scheme Rs. 747.52 Crore (Previous year Rs. 864.90 Crore).

2. Contingent liabilities in respect of claims not acknowledged and not provided for, are as follows:

Rs. in Crore (10 million)

31st March, 2015 31st March,20I4

a) Excise duty liability in respect of matters in appeals 14.31 12.69

b) Sales tax liability in respect of matters in appeals 0.72 2.82

c) Other Matters 11.36 9.99

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

3. In respect of levy of Octroi pertaining to Unit - CPM by Songadh Group Gram Panchayat, the Company has paid Rs. 1.25 Crore till 31st March 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

4. The Company has only one business segment i.e. Paper and Boards and geographical reportable segment i.e. Operations mainly within India, hence Segment Reporting as defined in Accounting Standard (AS - 17) is not required.

5. a) Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - CPM were revalued as on 30.09.1976.

The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine 1 & 11 and Railway Sidings were revalued as on 31.03.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 42.27 Crore, which has been transferred to Revaluation Reserve during the year ended 31.03.1994.

b) The Assets of Rs. 157.84 Crore held for sale, disclosed under the heading of "Other Current Assets" consists of Old Pulp Mill, Recovery Island, Power Block (Coal Fired Boilers & TG Sets) and Old Lime Klin Plant based on lower of Written down value and estimated Net Realisable Value. The Management is actively pursuing for disposal of these assets.

6. Pursuant to the Scheme of Arrangement sanctioned by the Hon'ble High Court of Gujarat under section 391 to 394 of the Companies Act 1956, which has become effective on 10th April 2015, Lime Kiln Undertaking of the JK Enviro-Tech Limited has been transferred and vested in the Company as a going concern on slump sale basis with effect from appointed date i.e. 1st April 2013.

The accounts for the year have been prepared by giving the effect of the above scheme. As per the Scheme, the assets of the Lime Kiln Undertaking have been recorded at its purchase cost to JK Paper Limited and apportioned based on independent expert advice.

d) With effect from Appointed date and up to and including the Effective date:

i) JK Enviro-Tech Limited carried on the business activities of the Lime Kiln undertaking w.e.f. from Is1 April 2013 till 10th April 2015 for and behalf of the JK Paper Limited,

ii) All profits or income that accrued to JK Enviro-Tech Limited and all taxes thereof or losses arising or incurred by it with respect to Lime Kiln Undertaking has been, for all purposes including accounting and Tax, treated as the profits, taxes or losses as the case may be, of JK Paper Limited.

iii) Pursuant to above, profit of Rs. 2.02 Crore (net of deferred tax of Rs. 0.90 Crore) of Lime Kiln Undertaking related to Financial Year 2013-14 has been added to the General Reserve.

# includes Rs. 24.58 Crore. disclosed as held for sale, under the heading of "Other Current Assets "

e) As a result of the above, there is diminution in value of the investments made in the shares of JK Enviro-Tech Limited. As per the Scheme, Loss arising as a result of the diminution has been charged to the statement of profit and loss of the Company and an amount equivalent to the aforementioned diminution in value of the investments, i.e., Rs. 5.04 Crore has been transferred from the securities premium reserve to the statement of profit and loss.

7. a) Long Term Loans and Advances includes concessional loan of Rs.I8.98 Crore (previous year Rs. 18.98 crore) and Short Term Loans and Advances includes Rs. 2.00 Crore (Previous year Rs. 2.00 Crore) to JK Paper Employees' Welfare Trust, a shareholder of the Company. Loan to employees of Rs. 0.37 Crore (Previous year Rs. 0.40 Crore) in the ordinary course of business and as per service rules of the Company.

b) Long Term Loans and Advances includes loan of Rs. 36.50 Crore (previous year Rs. 2.50 crore) and Short Term Loans and Advances includes loan of Rs. 1.00 Crore (Previous year Rs. 1.25 Crore) to Housing Subsidiaries for general corporate purpose,

c) Advances recoverable in cash or in kind or for value to be received under " Short Term Loan and Advances" in Note No, 19 .includes Rs, 4,73 Crore ( Previous Year Rs. 7.77 Crore) payments made for various development projects being undertaken by the Company including in Vietnam and Myanmar, The same will be adjusted once these projects are finalised.

8. a) Sales include export incentives of Rs. 6.38 Crore (Previous year Rs. 3.14 Crore).

b) Discount includes Trade Discount Rs 63.42 Crore (Previous year Rs. 55.05 Crore).

b) Defined Benefit Plans -

Gratuity Expense Rs. (-) 1.74 Crore (Previous year Rs. 1.39 Crore) has been recognized in "Salaries, Wages, Bonus and Gratuity etc." under Note 25.

Amount recognized as an expense and included in Note 25 & Note 47 below, Item "Contribution to Provident and Other Funds" Rs. 7.21 Crore (Previous year Rs. 7.35 Crore).

c) Defined Contribution Plans -

Amount recognized as an expense and included in Note 25 Item "Contribution to Provident and Other Funds" Rs. 1.21 Crore (Previous year Rs. [.12 Crore) for Superannuation Fund.

d) Other Long-Term Benefits -

Amount recognized as an expense and included in Note 25 Item "Salaries, Wages, Allowances etc." Rs. [.98 Crore (Previous year Rs. 2.05 Crore) for long term compensated Absences.

e) The expected return on plan assets is determined considering several applicable factors mainly the composition of the plan assets held, assessed risk of assets management, historical results on plan assets and the policy for plan assets management.

f) The estimates of future salary increase, considered in actuarial valuation, after taking account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

9. Exceptional Items for the previous year ended 31ffl March, 2014 represent gain on Derivative transactions Rs. 13.30 Crore, write back of provisions for diminution in the value of investments Rs. 4.53 Crore. and losses due to adverse operating parameters during stabilization period at Unit -JKPM Rs.35.32 Crore.

10. Interest Income includes Rs. 0.53 Crore (Previous year Rs 0.28 Crore) on Deposits with banks, Rs. 0.22 Crore (Previous year Rs. 0.10 Crore) on Income Tax refund and Rs. 7.91 Crore (Previous year Rs. 5.31 Crore) on others.

11. a) Future minimum lease payments under non-cancelable operating leases as on 31st March, 2015 are Rs.

12. Rs.20 Crore - Rs. 6.18 Crore within one year and Rs. 24.70 Crore later than one year but not later than five years and Rs. 11.32 Crore after Five year (Previous year Rs. Nil - Rs. Nil within one year and Rs. Nil later than one year but not later than five years).

b) Future minimum lease payments under non-cancelable Finance leases as on 31st March, 2015 are Rs. 0.82 Crore - Rs. 0.47 Crore within one year and Rs. 0.35 Crore later than one year but not later than five years (Previous year Rs. 1.29 Crore - Rs. 0.47 Crore within one year and Rs. 0.82 Crore later than one year but not later than five years) and their present value as on 31st March, 2015 are Rs. 0.76 Crore - Rs. 0.42 Crore within one year and Rs.0.34 Crore later than one year but not later than five year (Previous year Rs. 1.14 Crore - Rs. 0.39 Crore within one year and Rs. 0.75 Crore later than one year but not later than five year),

13. Based on information so far available in respect of MSME (as defined in The Micro Small & Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the period,

14. Consumption of Stores, Spares is net off scrap sale of Rs. 6.62 Crore (Previous year Rs. 6.46 Crore).

15. a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all outstanding derivatives except those covered under AS 11 (revised 2003) are marked to market on Balance Sheet date and there is gain of Rs. 0.36 Crore - reversal of previously recognized MTM Losses (Previous year gain of Rs. 0.55 Crore - reversal of previously recognized MTM Losses) which has been recognized in Statement of Profit and Loss.

16. Depreciation has been provided in accordance with Part C, Schedule II of the Companies Act, 2013 w.e.f.In April, 2014. Consequently the Depreciation and amortization expenses for the year are lower by Rs.37.02 Crore.

17. Current year's figures include impact of Scheme of Arrangement, hence previous year figures are not comparable. Previous year's figures have been re-grouped/re-arranged wherever necessary.


Mar 31, 2014

1. Estimated amount of (i) contracts remaining to be executed on capital account (Net of Advances) Rs. 27.19 Crore (Previous year Rs. 63.96 Crore), (ii) Investment Rs. 5.40 Crore (Previous year Rs. 12.60 Crore) and,

(iii) Export commitments against import of capital goods under EPCG scheme Rs. 864.90 Crore (Previous year Rs. 809.82 Crore).

2. Contingent liabilities in respect of claims not acknowledged and not provided for, are as follows:

Rs. in Crore (10 million)

31st March, 2014 31st March, 2013

a) Excise duty liability in respect of matters in appeals 12.69 12.63

b) Sales tax liability in respect of matters in appeals 2.82 2.82

c) Other Matters 9.99 10.82

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

3. a) The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro-Tech Limited. The Company has given an undertaking that on the happening of certain events, it will takeover the Loan taken by JK Enviro-Tech Limited from IDFC Limited. The current outstanding is Rs 11.76 Crore (including principal and interest) as on 31st March, 2014.

b) The Company has agreed with HDFC Limited that on happening of certain events, it will take all steps as may be required to ensure the timely repayment of the loan obligations of the Housing Subsidiaries for the loan availed from HDFC Limited. The current outstanding is Rs 36.09 Crore (including principal and interest) as on 31st March, 2014.

4. In respect of levy of Octroi pertaining to Unit - CPM by Songadh Group Gram Panchayat, the Company has paid Rs.1.25 Crore till 31st March 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

5. The Company has only one business segment i.e. Paper and Boards and geographical reportable segment i.e. Operations mainly within India, hence Segment Reporting as defined in Accounting Standard (AS - 17) is not required.

6. a) Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - CPM were revalued as on 30.09.1976.

The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.03.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 42.27 Crore, which has been transferred to Revaluation Reserve during the year ended 31.03.1994.

b) The Assets of Rs.134.15 Crore held for Sale, disclosed under the heading of "Other Current Assets" in Note No. 20, consists of Old Pulp Mill, Recovery Island and Power Block (Coal Fired Boilers & TG Sets) based on lower of Written Down Value and estimated Net Realisable Value. The Management intends to use these assets in various projects under consideration.

7. a) Long Term Loans and Advances includes concessional loan of Rs.18.98 Crore (previous year Rs. Nil) and

Short Term Loans and Advances includes Rs. 2.00 Crore (Previous year Rs. 20.98 Crore including concessional loan of Rs. 18.98 Crore) to JK Paper Employees'' Welfare Trust, a shareholder of the Company and loan to employees of Rs. 0.40 Crore (Previous year Rs. 0.45 Crore) in the ordinary course of business and as per service rules of the Company.

b) The Company entered in to an arrangement with JK Enviro-Tech Limited to process its Lime sludge and convert it to Lime on a cost plus basis to meet the pollution control norms under CREP. Loans and Advances include Rs. 19.04 Crore (Previous year Rs. 15.06 Crore) against future supplies.

c) Advances recoverable in cash or in kind or for value to be received under "Short Term Loan and Advances" in Note No.19, includes Rs. 7.77 Crore ( Previous Year Rs. 5.22 Crore) payments made for various development projects being undertaken by the Company including in Vietnam and Myanmar .The same will be adjusted once these projects are finalised .

8. a) Sales include export incentives of Rs. 3.14 Crore (Previous year Rs. 3.91 Crore).

b) Discount includes Trade Discount Rs 55.05 Crore (Previous year Rs. 54.19 Crore).

b) Defined Benefit Plans -

Gratuity Expense Rs. 1.39 Crore (Previous year Rs. 3.10 Crore) has been recognized in "Salaries, Wages, Bonus and Gratuity etc." under Note 25.

Amount recognized as an expense and included in Note 25 & Note 47 below, Item "Contribution to Provident and Other Funds" Rs. 7.35 Crore (Previous year Rs. 5.88 Crore).

c) Defined Contribution Plans -

Amount recognized as an expense and included in Note 25 Item "Contribution to Provident and Other Funds" Rs. 1.12 Crore (Previous year Rs. 2.14 Crore) for Superannuation Fund.

d) Other long-term benefits -

Amount recognized as an expense and included in Note 25 Item "Salaries, Wages, Allowances etc." Rs. 2.05 Crore (Previous year Rs. 1.31 Crore) for long term compensated Absences.

e) The expected return on plan assets is determined considering several applicable factors mainly the composition of the plan assets held, assessed risk of assets management, historical results on plan assets and the policy for plan assets management.

f) The estimates of future salary increase, considered in actuarial valuation, after taking account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

9. Exceptional Items for the year ended 31st March, 2014 represent gain on Derivative transactions Rs.13.30 Crore, write back of provisions for diminution in the value of investments Rs.4.53 Crore and losses due to adverse operating parameters during stabilization period at Unit -JKPM Rs.35.32 Crore.

10. Interest Income includes Rs. 0.28 Crore (Previous year Rs 1.03 Crore) on Deposits with banks, Rs. 0.10 Crore (Previous year Rs. 0.06 Crore) on Income Tax refund and Rs. 5.31 Crore (Previous year Rs. 7.72 Crore) on others.

11. Capital Work-in-progress includes machinery, building under construction and the following expenses pending allocation/capitalization.

12. a) Future minimum lease payments under non-cancelable operating leases as on 31st March, 2014 are Rs. Nil, Rs. Nil within one year and Rs. Nil later than one year but not later than five years (Previous year Rs. 0.04 Crore, Rs. 0.04 Crore within one year and Rs. Nil later than one year but not later than five years).

b) Future minimum lease payments under non-cancelable Finance leases as on 31st March, 2014 are Rs. 1.29 Crore, Rs. 0.47 Crore within one year and Rs. 0.82 Crore later than one year but not later than five years (Previous year Rs. 1.64 Crore, Rs. 0.47 Crore within one year and Rs. 1.17 Crore later than one year but not later than five years) and their present value as on 31st March, 2014 are Rs. 1.14 Crore, Rs. 0.39 Crore within one year and Rs.0.75 Crore later than one year but not later than five year (Previous year Rs.1.39 Crore, Rs. 0.35 Crore within one year and Rs.1.04 Crore later than one year but not later than five year).

13. Based on information so far available in respect of MSME (as defined in ''The Micro Small & Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the period.

14. Consumption of Stores, Spares is net off scrap sale of Rs. 6.46 Crore (Previous year Rs. 5.29 Crore).

15. a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all outstanding derivatives except covered under AS 11 (revised 2003) are marked to market on Balance Sheet date and there is gain of Rs. 0.55 Crore - reversal of previously recognised MTM Losses (Previous year gain of Rs. 0.18 Crore - reversal of previously recognised MTM Losses) which has been recognized in Statement of Profit and Loss.

16. a) Pursuant to the Accounting Standard (AS 22) - ''Accounting for Taxes on Income'', deferred tax (liability)/ asset at Balance Sheet date is:

b) Based on the past performance and current plans, the Company expects to continue to generate taxable income which will enable it to utilise MAT credit entitlement.

c) During the current year the Company has provided Current Tax Rs. 0.08 Crore (Previous year Rs. 0.02 Crore) and also reversed MAT credit Entitlement of Rs. 0.33 Crore (previous year recognized MAT credit entitlement of Rs.1.80 Crore) related to earlier years.

17. Disclosure as required under ''Related Party Disclosures'' (AS 18) issued by The Institute of Chartered Accountants of India are as below:

a. List of Related Parties

i. Subsidiaries (Wholly Owned)

- Songadh Infrastructure & Housing Limited

- Jaykaypur Infrastructure & Housing Limited

ii. Subsidiary

- JK Enviro-Tech Limited

iii. Joint Venture

- Oji JK Packaging Private Limited

iv. Enterprise over which KMP''s have significant influence

- Habras International Limited

v. Key Management Personnel (KMP)

- Shri Harsh Pati Singhania - Vice Chairman & Managing Director

- Shri Om Prakash Goyal - Whole-time Director

Key Management Personnel (KMP) :

The remuneration paid to Vice Chairman & Managing Director Rs. 3.05 Crore (Previous year Rs. 2.90 Crore) and Whole Time Director Rs. 1.78 Crore (Previous year Rs. 1.58 Crore). The remuneration paid to the Managerial Personnel by way of minimum remuneration, in terms of the appointment, exceeds the limit prescribed under Section 309(3) of the Companies Act, 1956, by Rs. 3.52 Crore, and is subject to requisite approvals from the Central Government of India. Remuneration is excluding provision for Gratuity & Leave Encashment, where the actuarial valuation is done on overall Company basis.

18. During the year, JK Enviro-Tech Limited has become a Subsidiary of the Company. The Stock Exchanges have conveyed their "no-objection" to the proposed Scheme of Arrangement for transfer of Lime Kiln Undertaking of the Subsidiary w.e.f. 1st April 2013, to the Company. The Company will now file the said Scheme before the High Court of Gujarat for its approval. Pending approval, no impact has been considered in the standalone accounts of the Company in the current financial year.

19. Previous year''s figures have been re-grouped/re-arranged wherever necessary.

As per our report of even date

20 Principles of Consolidation:

a) The Consolidated Financial Statements comprise of the financial statements of JK Paper Limited (Parent Company) and the following as on 31st March, 2014;

b) The Financial Statements of the Parent Company and its Subsidiaries have been consolidated on a line by line basis by adding together the book value of like items of assets, liabilities, income and expenses, after eliminating intra-group balances and intra-group transactions.

JK Enviro-Tech Limited has become a subsidiary of the Company and consolidated during the current year, hence the figure of current year are not comparable with the previous year.

c) In case of Joint Venture, Company has adopted the proportionate consolidation method in accordance with Accounting Standard (AS-27) - "Financial Reporting of Interest in Joint Ventures".

d) The Accounting Policies of the Parent Company, its Subsidiaries and Joint Venture are largely similar, hence not be re-produced.

e) Significant Accounting Policies and Notes on Accounts of the Financial Statements of the Company and its Subsidiaries are stated in their respective Financial Statements.

21 Trade Payable includes Rs. 0.07 Crore, Capital work in progress includes Rs. 5.60 Crore, Current Tax (MAT) includes Rs. 0.05 Crore and Deferred Tax Credit includes Rs. 0.06 Crore for share of Joint Venture.

22 Estimated amount of (i) contracts remaining to be executed on capital account (Net of Advances) Rs. 30.56 Crore (Previous year Rs. 63.96 Crore) including share of Joint Venture Rs. 3.37 Crore (Previous year Rs. Nil),

(ii) Investment Rs. 5.40 Crore (Previous year Rs. 12.60 Crore) and, (iii) Export commitments against import of capital goods under EPCG scheme Rs. 864.90 Crore (Previous year Rs. 809.82 Crore).

23 Contingent liabilities in respect of claims not acknowledged and not provided for, are as follows:

Rs. in Crore (10 million) 31st March, 2014 31st March, 2013

a) Excise duty liability in respect of matters in appeals 12.69 12.63

b) Sales tax liability in respect of matters in appeals 2.82 2.82

c) Other Matters 9.99 10.82

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

24 a) The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro-Tech Limited. The Company has given an undertaking that on the happening of certain events, it will takeover the Loan taken by JK Enviro-Tech Limited from IDFC Limited. The current outstanding is Rs. 11.76 Crore (including principal and interest) as on 31st March, 2014.

b) The Company has agreed with HDFC Limited that on happening of certain events, it will take all steps as may be required to ensure the timely repayment of the loan obligations of the Housing Subsidiaries for the loan availed from HDFC Limited. The current outstanding is Rs. 36.09 Crore (including principal and interest) as on 31st March, 2014.

25 Segment Reporting

The Company has identified business segment as the primary segment, after considering all the relevant factors. The Company''s manufactured products are sold primarily within India hence there is no reportable geographical segment.

The Company''s operation predominantly relates to manufacture of Paper & Boards. Other Business Segment comprises activities for providing housing facilities to the employees engaged in Paper & Board manufacturing business and manufacturing of Lime for JK Paper Limited. These operations are insignificant in the context of total turnover, hence same has been shown as "Others".

26 a) Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - Central Pulp Mills were revalued as on 30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.03.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 42.27 Crore, which has been transferred to Revaluation Reserve during the year ended 31.03.1994.

b) The Assets of Rs.134.15 Crore held for Sale, disclosed under the heading of "Other Current Assets" in Note No.20, consists of Old Pulp Mill, Recovery Island and Power Block (Coal Fired Boilers & TG Sets) based on lower of Written Down Value and estimated Net Realisable Value. The Management intends to use these assets in various projects under consideration.

27 a) Long Term Loans and Advances includes concessional loan of Rs.18.98 Crore (previous year Rs. Nil) and Short Term Loans and Advances includes Rs. 2.00 Crore (Previous year Rs. 20.98 Crore including concessional loan of Rs. 18.98 Crore) to JK Paper Employees'' Welfare Trust, a shareholder of the Company and loan to employees of Rs. 0.40 Crore (Previous year Rs. 0.45 Crore) in the ordinary course of business and as per service rules of the Company.

b) Advances recoverable in cash or in kind or for value to be received under "Short Term Loan and Advances" in Note No.19 ,includes Rs.7.77 Crore (Previous Year Rs.5.22 Crore) payments made for various development projects being undertaken by the Company including in Vietnam and Myanmar .The same will be adjusted once these projects are finalised .

28. Exceptional Items for the year ended 31st March, 2014 represent gain on Derivative transactions Rs.13.30 Crore, write back of provisions for diminution in the value of investments Rs.4.53 Crore. and losses due to adverse operating parameters during stabilization period at Unit -JKPM Rs.35.32 Crore.

29. a) Pursuant to the Accounting Standard (AS 22) - ''Accounting for Taxes on Income'', deferred tax (liability)/ asset at Balance Sheet date is:

b) Based on the past performance and current plans, the Company expects to continue to generate taxable income which will enable it to utilise MAT credit entitlement.

c) During the current year the Company has provided Current Tax Rs. 0.08 Crore (Previous year Rs. 0.02 Crore) and also reversed MAT credit Entitlement of Rs. 0.33 Crore (previous year recognized MAT credit entitlement of Rs.1.80 Crore) related to earlier years.

30. Disclosure as required under ''Related Party Disclosures'' (AS 18) issued by The Institute of Chartered Accountants of India are as below:

a) List of Related Parties

i. Enterprise over which KMP''s have significant influence

- Habras International Limited

ii. Key Management Personnel (KMP)

- Shri Harsh Pati Singhania - Vice Chairman & Managing Director

- Shri Om Prakash Goyal - Whole-time Director

Key Management Personnel (KMP) :

The remuneration paid to Vice Chairman & Managing Director Rs. 3.05 Crore (Previous year Rs. 2.90 Crore) and Whole Time Director Rs. 1.78 Crore (Previous year Rs. 1.58 Crore). The remuneration paid to the Managerial Personnel by way of minimum remuneration, in terms of the appointment, exceeds the limit prescribed under Section 309(3) of the Companies Act, 1956, by Rs. 3.52 Crore, and is subject to requisite approvals from the Central Government of India. Remuneration is excluding provision for Gratuity & Leave Encashment, where the actuarial valuation is done on overall Company basis.

31. Previous year''s figures have been re-grouped/re-arranged wherever necessary.


Mar 31, 2013

1. Estimated amount of (i) contracts remaining to be executed on capital account (Net of Advances) Rs. 63.96 Crore (Previous year Rs. 668.29 Crore) and (ii) Investment Rs. 12.60 Crore (Previous year Rs. Nil). Export commitments against import of capital goods under EPCG scheme Rs. 809.82 Crore (Previous year Rs. 364.81 Crore).

2. Contingent liabilities in respect of claims not acknowledged and not provided for, are as follows:

Rs. in Crore (10 million)

31st March, 2013 31st March, 2012

a) Excise duty liability in respect of matters in appeal 12.63 9.83

b) Sales tax liability in respect of matters in appeals 2.82 3.69

c) Other Matters 10.82 27.78

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

3. a) The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro-Tech Ltd. The Company has given an undertaking that on the happening of certain events, it will takeover the Loan taken by JK Enviro-Tech Ltd. from IDFC Ltd. The current outstanding is Rs. 17.17 Crore (including principal and interest) as on 31st March, 2013.

b) The Company has agreed with HDFC Limited that on happening of certain events, it will take all steps as may be required to ensure the timely repayment of the loan obligations of the Housing Subsidiaries for the loan availed from HDFC Limited. The current outstanding is Rs. 38.40 Crore (including principal and interest) as on 31st March, 2013.

4. In respect of levy of Octroi pertaining to Unit - CPM by Songadh Group Gram Panchayat, the Company has paid Rs.1.25 Crore till 31st March 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

5. The Company has only one business segment i.e. Paper and Boards and geographical reportable segment i.e. Operations mainly within India, hence Segment Reporting as defined in Accounting Standard (AS - 17) is not required.

6. Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - CPM were revalued as on 30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.3.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 42.27 Crore, which has been transferred to Revaluation Reserve during the year ended 31.3.1994.

7. a) Loans and Advances includes loans of Rs. 20.98 Crore (previous year Rs. 23.48 Crore) to JK Paper Employees'' Welfare Trust, a shareholder of the Company, {includes Short Term Loan Rs. 2.00 Crore (Previous year Rs. 2.00 Crore), Long Term Loan of Rs. Nil (Previous year Rs. 2.00 Crore) and a concessional loan of Rs. 18.98 Crore (Previous year Rs. 19.48 Crore)} and loan to employees of Rs. 0.45 Crore (Previous year Rs. 0.65 Crore) in the ordinary course of business and as per service rules of the Company. b) The Company entered in to an arrangement with JK Enviro-Tech Limited to process its Lime sludge and convert it to Lime on a cost plus basis to meet the pollution control norms under CREP. Loans and Advances include Rs. 15.06 Crore (Previous year Rs. 6.19 Crore) against future supplies.

8. a) Sales include export incentives of Rs. 3.91 Crore (Previous year Rs. 2.76 Crore).

b) Discount includes Trade Discount Rs 54.19 Crore (Previous year Rs. 53.46 Crore).

9. Interest Income includes Rs. 1.03 Crore (Previous year Rs 5.15 Crore) on Deposits with banks, Rs. 0.06 Crore (Previous year Rs. 0.39 Crore) on Income Tax refund and Rs. 7.72 Crore (Previous year Rs. 11.67 Crore) on others.

10. Capital Work in progress includes machinery, building under construction and the following expenses pending allocation/capitalization.

11. a) Future minimum lease payments under non-cancelable operating leases as on 31st March, 2013 are Rs. 0.04 Crore - Rs. 0.04 Crore within one year and Rs. Nil later than one year but not later than five years (Previous year Rs. 0.10 Crore - Rs. 0.05 Crore within one year and Rs. 0.05 Crore later than one year but not later than five years).

b) Future minimum lease payments under non-cancelable Finance leases as on 31st March, 2013 are Rs. 1.64 Crore - Rs. 0.47 Crore within one year and Rs. 1.17 Crore later than one year but not later than five years (Previous year Rs. Nil) and their present value as on 31st March, 2013 are Rs. 1.39 Crore - Rs. 0.35 Crore within one year and Rs. 1.04 Crore later than one year but not later than five year (Previous year Rs. Nil).

12. Based on information so far available in respect of MSME (as defined in ''The Micro Small & Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the period.

13. Consumption of Stores, Spares is net of scrap sale of Rs. 5.29 Crore (Previous year Rs. 3.54 Crore).

14. a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all outstanding derivatives except covered under AS 11 (revised 2003) are marked to market on Balance Sheet date and there is gain of Rs. 0.18 Crore - reversal of previously recognised MTM Losses (Previous year Loss of Rs. 0.42 Crore) which has been recognized in Statement of Profit and Loss.

b) Forward contract outstanding for purpose of hedging as at Balance Sheet date:

c) Nominal amounts of Currency and Interest Rate Swaps for hedging entered into by the Company and outstanding at end of the year is Rs. 198.12 Crore (Previous year Rs. 227.02 Crore).

d) Foreign currency exposure not hedged as at Balance Sheet date:

15. Disclosure as required under ''Related Party Disclosures'' (AS 18) issued by The Institute of Chartered Accountants of India are as below:

a. List of Related Parties

i. Subsidiaries (Wholly Owned)

- Songadh Infrastructure & Housing Ltd.

- Jaykaypur Infrastructure & Housing Ltd.

ii. Joint Venture

- Oji JK Packaging Pvt. Ltd.

iii. Associate

- JK Enviro-Tech Ltd.

iv. Enterprise over which KMP''s have significant influence

- Habras International Limited

v. Key Management Personnel (KMP)

- Shri Hari Shankar Singhania* - Chairman

- Shri Harsh Pati Singhania - Managing Director

- Shri Om Prakash Goyal - Whole-time Director

* Deceased on 22nd February, 2013.

16. During the year the Company has entered into Joint Venture for the purpose of manufacturing and sale of corrugated packaging products with Oji Holding Corporation, Japan and Marubeni Corporation, Japan. Accordingly "Oji JK Packaging Pvt. Ltd." has become a Joint Venture (JV) in India consisting 60% holding by Oji Holding Corporation, Japan, 20% holding by Marubeni Corporation, Japan and 20% holding by the Company. The Company has subscribed Rs. 2.40 Crore as it''s share of Equity in JV. There has been no operation in the JV Company during the year except issue of share capital, hence the requirement of AS 27 does not arise.

17. Exceptional Items represents provision of earlier periods no longer required.

18. The proceeds of the Right issue and FCCB have been fully utilized for the expansion project.

19. Previous year''s figures have been re-grouped/re-arranged wherever necessary.


Mar 31, 2012

(a) (i) Equity Shares:

The equity shareholders have:- - The right to receive dividend out of balance of net profits remaining after payment of dividend to the preference shareholders. The dividend proposed by Board of Directors is subject to approval of shareholders in the ensuing general meeting.

- The Company has only one class of Equity Shares having face value of Rs. 10/- each and each shareholder is entitled to one vote per share.

- In the event of winding up, the equity shareholders will be entitled to receive the remaining balance of assets if any, after preferential payments and to have a share in surplus assets of the Company, proportionate to their individual shareholding in the paid up equity capital of the Company.

(ii) Preference Shares:- The cumulative redeemable preference shareholders have:- - The right to receive a fixed cumulative preferential dividend at specified rate on the paid up capital.

- The right to receive arrears of cumulative dividend, if any, whether earned or declared or not, at time of redemption of the said shares, and,

- The right in a winding up to have the capital paid up on such shares and the arrears, if any, of the said preferential dividend, whether earned or declared or not, be paid off in priority to any payment of capital on equity shares. However, it shall not confer the right to any further participation in the profits or assets of the Company.

- The right to vote, in respect of such capital, in proportion as paid up preference share capital bears to the total paid up equity capital only on resolutions directly affecting their rights and on every resolution on non-payment of dividend for an aggregate period of not less than two years.

Terms of Redemption: The Company has redeemed 10% Cumulative Redeemable Preference Shares (Series F) of Rs. 0.06 Crore on 30th June, 2011 along with premium on redemption of Rs. 5.46 Crore. Further 10% Cumulative Redeemable Preference Shares (Series G) of Rs 0.03 Crore are redeemable on 30th June 2012 along with Premium on redemption of Rs. 5.46 Crore.

Notes:

(a) During the year 5,84,70,686 Equity Shares have been issued at a premium of Rs. 32/- per share.

(b) (i) Adjusted Premium on Redemption of Preference Shares Rs. 5.46 Crore (Previous year Rs. 5.46 Crore). (ii) Share issue expenses on account of Rigths Issue Rs. 2.80 Crore (Previous year Nil).

(c) (i) Rs. 0.19 Crore to Statement of Profit and Loss towards Additional Depreciation arising out of revaluation of Fixed Assets (Previous year Rs. 0.21 Crore).

(ii) Pursuant to the Scheme of Arrangement, Current year Rs. Nil (Previous year Rs. 1.42 Crore).

(d) (i) Transfer from Surplus in Statement of Profit and Loss - Current year Rs. 2.50 Crore (Previous year Rs. 11.00 Crore).

(ii) Pursuant to the Scheme of Arrangement towards adjustment of Deferred Tax Liability Current year Rs. Nil (Previous year Rs. 4.53 Crore).

(e) Dividend proposed @ Rs. 1.50/- per Equity Share and @ Rs. 10/- per Preference Share.

Notes:

(a) Term Loans of Rs. 307.43 Crore (FIs – Rs. 73.63 Crore and Banks Rs. 233.80 Crore) are secured by means of first pari passu mortgage/charge on the fixed assets of the Company. Out of the above Term Loan Rs. 107.65 Crore (FIs - Rs. 70.25 Crore and Banks Rs. 37.40 Crore) are further secured by second charge on the current assets of the Company. These Term Loans are/shall be repayable as under :-

(i) Term Loans aggregating to Rs. 22.46 Crore are repayable in 3 equal annual instalments from June-2012 to June-2014,

(ii) Term Loan of Rs. 37.86 Crore is repayable in 9 half-yearly instalments from June-2012 to June-2016,

(iii) Term Loans aggregating to Rs. 89.06 Crore are repayable in total 28 equal half-yearly instalments from June-2012 to June-2018,

(iv) Term Loans aggregating to Rs. 130.17 Crore are repayable in total 51 equal quarterly instalments from April-2012 to March-2018,

(v) Term Loans aggregating to Rs. 4.48 Crore are repayable in June 2012,

(vi) Term Loan of Rs. 23.40 Crore is repayable in 26 equal monthly instalments from April-2012 to May-2014.

(b) Terms Loans of Rs. 393.53 Crore (FIs – Rs. Nil, Banks Rs. 393.53 Crore) are secured by means of first pari passu mortgage/charge on the fixed assets, both present and future, of Unit JKPM of the Company. These Term Loans are/shall be repayable as under :-

(i) Term Loans aggregating to Rs. 95.00 Crore are repayable in total 25 equal quarterly instalments from September-2014 to December-2020,

(ii) Term Loans aggregating to Rs. 298.53 Crore are repayable in total 50 equal half-yearly instalments from March-2013 to March-2023,

(c) Certain charges have been created against which loan disbursement partially/yet to be availed.

(d) Certain charges are in the process of satisfaction.

(e) Secured Terms Loans from Financial Institutions and Banks include Rs. 403.57 Crore foreign currency loans.

(f) Un-secured Term Loan from Bank of Rs. 2.43 Crore is repayable in 4 equal half yearly instalments from Apr-2012

(g) FCCB's of EURO 35 Million @ 6.455% issued on 30th May, 2011 are convertible into equity shares of the Company at an initial conversion price of Rs. 65 per share, subject to price adjustment as per agreement, after 3 years and 6 months from the date of issue. If not converted then the FCCBs will be redeemed at par between 15th May 2016 to 15th May 2018 in 5 half yearly instalments.

(h) Public Deposits are due for repayment in 2012-13, 2013-14 & 2014-15.

Note:

Working Capital Borrowings are secured by hypothecation of Stores, Raw Materials, Finished Goods, Stock- in-Process and Book Debts. The same are further secured by a second charge on the movable and immovable assets of the Company.

# Includes Raw Materials in transit Rs. 0.69 Crore (Previous year Rs. 0.02 Crore) and Stores and Spares in transit Rs. 0.26 Crore (Previous year Rs. 0.06 Crore).

$ Includes Pulp in process Rs. 2.87 Crore (Previous year Rs. 1.61 Crore) and Semi Finished Goods Rs.11.64 Crore (Previous year Rs. 7.30 Crore).

1. Estimated amount of contracts remaining to be executed on Capital Account (Net of Advances) Rs. 668.29 Crore (Previous year Rs. 1,107.06 Crore) and export commitments against import of capital goods under EPCG scheme Rs. 364.81 Crore (Previous year Nil).

2. Contingent liabilities in respect of claims not acknowledged and not provided for, are as follows:

Rs. in Crore (10 million) 31st March, 2012 31st March, 2011

(a) Excise duty liability in respect of matters in appeal 9.83 9.62

(b) Sales tax liability in respect of matters in appeal 3.69 3.88

(c) Other Matters 27.78 11.75

In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

3. The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro- Tech Ltd. The Company has given an undertaking that on the happening of certain events, it will takeover Loan taken by JK Enviro-Tech Ltd. from IDFC Ltd. of the value of Rs. 40 Crore.

4. In respect of levy of Octroi pertaining to Unit Central Pulp Mills by Songadh Group Gram Panchayat, the Company had paid Rs. 1.25 Crore till 31st March, 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

5. The Company has only one business segment i.e. Paper and Board and geographical reportable segment i.e. Operations within India, hence Segment Reporting as defined in Accounting Standard (AS – 17) is not required.

6. Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - Central Pulp Mills were revalued as on 30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.3.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets had been increased by Rs. 42.27 Crore, which had been transferred to Revaluation Reserve during the year ended 31.3.1994.

7. Loans and Advances includes loans of Rs. 23.48 Crore (previous year Rs. 23.48 Crore) to JK Paper Employees' Welfare Trust, a shareholder of the Company, {includes Long Term Loan Rs. 2.00 Crore (Previous year Rs. 2.00 Crore) and a concessional loan of Rs. 19.48 Crore (Previous year Rs. 19.48 Crore)} & to Body Corporate Rs. Nil (Previous year Rs. 0.50 Crore) and loan to employees Rs. 0.65 Crore (Previous year Rs. 0.80 Crore) in the ordinary course of business and as per service rules of the Company.

8. (a) Sales include export incentives of Rs. 2.76 Crore (Previous year Rs. 3.15 Crore). (b) Discount includes Trade Discount Rs. 53.46 Crore (Previous year Rs. 51.99 Crore).

(b) Defined Benefit Plans –

Gratuity Expense Rs. 1.52 Crore (Previous year Rs. 2.29 Crore) has been recognized in "Salaries, Wages, Bonus and Gratuity etc." under Note 25.

Amount recognized as an expense and included in Note 25 & Note 46 below, item "Contribution to Provident and Other Funds" Rs. 5.17 Crore (Previous year Rs. 4.87 Crore).

Pending the issuance of Guidance Note from the Institute of Actuaries of India, the Company's actuary has expressed his inability to reliably measure the provident fund liability.

(c) Defined Contribution Plans –

Amount recognized as an expense and included in Note 25 item "Contribution to Provident and Other Funds" Rs. 2.10 Crore (Previous year Rs. 2.05 Crore) for Superannuation Fund.

(d) Other long-term benefits –

Amount recognized as an expense and included in Note 25 item "Salaries, Wages, Bonus and Gratuity etc." Rs. 0.99 Crore (Previous year Rs. 2.08 Crore) for Long Term Compensated Absences.

(e) The expected return on plan assets is determined considering several applicable factors mainly the composition of the plan assets held, assessed risk of assets management, historical results on plan assets and the policy for plan assets management.

(f) The estimates of future salary increase, considered in actuarial valuation, after taking account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

9. Interest Income includes Rs. 5.15 Crore (Previous year Rs 0.81 Crore) on Deposits with banks, Rs. 0.39 Crore (Previous year Rs. 0.14 Crore) on Income Tax refund and Rs. 11.67 Crore (Previous year Rs. 6.52 Crore) on others.

10. Capital Work in progress includes machinery, building under construction and the following pre-operative expenses pending allocation/capitalization.

11. Future minimum lease payments under non-cancelable operating leases as on 31st March, 2012 are Rs. 0.10 Crore - Rs. 0.05 Crore within one year and Rs. 0.05 Crore later than one year but not later than five years (Previous year Rs. 0.18 Crore - Rs. 0.06 Crore within one year and Rs. 0.12 Crore later than one year but not later than five years).

12. Based on information so far available in respect of MSME (as defined in 'The Micro Small & Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the period.

13. Consumption of Stores and Spares is net of scrap sale of Rs. 3.54 Crore (Previous year Rs. 4.38 Crore).

14. (a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all outstanding derivatives except covered under AS 11 (revised 2003) are marked to market on Balance Sheet date and there is loss of Rs. 0.42 Crore (Previous year gain of Rs. 0.47 Crore -reversal of previously recognised MTM Losses) which has been recognized in Statement of Profit and Loss.

(b) Nominal amounts of Currency and Interest Rate Swaps for hedging entered into by the Company and outstanding at end of the year is Rs. 227.02 Crore (Previous year Rs.115.05 Crore).

*Net of Receivables Euro 3,311.00 - Rs. 0.02 Crore (Previous year Euro 3,311.00 -Rs. 0.02 Crore) and Sterling Pound Nil – Rs. Nil (Previous year Sterling Pound 510.00 – Rs. 36,667/-).

15. Research and Development expenditure amounting to Rs. 1.31 Crore (Previous year Rs. 1.04 Crore) has been charged to Statement of Profit and Loss.

16. Amount Paid to Auditors (including service tax):

(b) Based on the past performance and current plans, the Company expects continue to generate taxable income which will enable it to utilise MAT credit entitlement.

(c) During the previous year Company had recognized additional MAT credit entitlement of Rs. 0.31 Crore related to earlier year.

17. Disclosure as required under 'Related Party Disclosures' (AS 18) issued by The Institute of Chartered Accountants of India are as below:

(a) List of Related Parties

(i) Subsidiaries (Wholly Owned)

- Songadh Infrastructure & Housing Ltd

- Jaykaypur Infrastructure & Housing Ltd (ii) Associate

- JK Enviro-Tech Ltd

(iii) Enterprise over which KMP's have significant influence

- Habras International Ltd

Key Management Personnel (KMP):

The remuneration paid to Chairman Rs. 2.66 Crore (Previous year Rs. 5.73 Crore), Managing Director Rs. 2.66 Crore (Previous year Rs. 6.33 Crore) and Whole Time Director Rs. 1.43 Crore (Previous year Rs. 1.84 Crore). The remuneration paid to the Managerial Personnel by way of minimum remuneration, in terms of the appointment, exceeds the limit prescribed under Section 309(3) of the Companies Act 1956, by Rs. 1.30 Crore, this is subject to requisite approvals from the Central Government of India.

# includes Rs. 3.54 Crore Scrap Sales (Previous Year Rs. 4.38 Crore) and Rs. 0.10 Crore grouped under Note No. 46 in other heads of account (Previous Year Rs. 0.26 Crore).

18. (a) The Company has raised Rs. 245.58 Crore through Rights Issue of Equity Shares and Rs. 226.14 Crore (Euro 35 Million) by issue of unsecured & unlisted Foreign Currency Convertible Bonds (FCCBs). Out of the above, Rs. 298.27 Crore (including Rights Issue Rs. 148.27 Crore) have been deployed for the project. The balance Rs. 173.45 Crore have been invested in mutual fund and fixed deposits with Banks, (b) During the year, Share Issue Expenses of Rs. 2.80 Crore have been charged from Securities Premium Account in accordance with Section 78 of the Companies Act, 1956, as compared to earlier policy of charging to Statement of Profit and Loss.

19. Current year accounts have been prepared in accordance with the Revised Schedule–VI and previous year's figures have been re-grouped/re-classified accordingly.

Note:

1. Previous year's figures have been re-grouped / re-arranged wherever necessary.

Note: The Ministry of Corporate Affairs, Government of India, New Delhi vide its General Circular No. 2/2011 dated 8th Feb. 2011, issued under Section 212 (8) of the Companies Act, 1956 has granted a general exemption from attaching the accounts of Subsidiary Companies. However, annual accounts of the Subsidiary Companies and the related detailed information shall be made available to the shareholders of the Holding and Subsidiary Companies seeking such information at any point of the time. The annual accounts of the Subsidiary Companies are also available for inspection by any shareholder at the Registered and Head Office of the Company and that of the Subsidiary Companies concerned.


Mar 31, 2011

1. Estimated amount of contracts remaining to be executed on capital account (Net of Advances) Rs. 1,10,706.21 Lac (Previous year Rs. 1,139.98 Lac).

2. Contingent liabilities in respect of claims not acknowledged as debts are as follows:

Rs. in Lac (0.1 million)

31st March, 2011 3 Ist March, 2010

a) Excise duty liability in respect of matters in appeal 961.59 271.91

b) Sales tax liability in respect of matters in appeal 387.69 182.27

c) Other Matters I,175.02 1,199.15

Above claims are likely to be decided in favour of the company, hence, not provided for.

3. a) In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are

pending before the Appellate Authorities and adjustment, if any, will be made after the same are finally determined.

b) The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro-tech Ltd.The Company has given an undertaking that on the happening of certain events.it will takeover loan taken byJK Enviro-tech Ltd. from IDFC Ltd. of the value of Rs. 40 Crore.

4. In respect of levy of Octroi pertaining to Unit - CPM by Songadh Group Gram Panchayat, the Company has paid Rs. 125.07 Lac till 3 Ist March 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

5. Pursuant to the Scheme of Arrangement sanctioned by the Honble High Courts of Gujarat & Orissa under section 391 to 394 of the Companies Act, 1956 which has become effective on 20th January 2011, CPM Staff Housing Undertaking and JKPM Staff Housing Undertaking of the Company have been transferred and vested to Songadh Infrastructure & Housing Limited (SIHL) and Jaykaypur Infrastructure & Housing Limited (JIHL) respectively on a going concern basis w.e.f. Ist April 2009, as a result

(ii) The Company carried on the business of the above two Housing Undertaking w.e.f. Ist April 2009 till 20th Jan 2011 for and on behalf of SIHL and JIHL.

(iii) The Deferred Tax Liability of Rs. 452.71 Lacs has been adjusted against the General Reserve.

(iv) Based upon an agreement, the Company has reimbursed all the expenses incurred, during Ist April, 2009 to 20th January, 2011 by SIHL and JIHL.

6. The Company has only one business segment i.e. Paper and Boards and geographical reportable segment i.e. Operations within India, hence Segment Reporting as Defined in Accounting Standard (AS – 17) is not required.

7. Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - CPM were revalued as on 30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.3.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 4,227.24 Lac, which has been transferred to Revaluation Reserve during the year ended 31.3.1994.

8. Loans and Advances are net of provisions for doubtful advances of Rs. 49.40 Lac (Previous year Rs. 53.04 Lac) and includes loans of Rs. 2,348.45 Lac (previous year Rs. 2,848.45 Lac) to JK Paper Employees’ Welfare Trust, a shareholder of the Company, {includes concessional loans of Rs. 1,948.45 Lac (Previous year Rs. 2,248.45 Lac)}, loans to JK Enviro-tech Limited (an Associate) Rs. 2,655.31 Lac (Previous year Rs. 2,739.27 Lac), Loan to subsidiaries Rs. 4,250.00 Lac (Previous year Nil) & to body corporate Rs. 50.00 Lac (Previous year Rs. 50.00 Lac) and loan to employees Rs. 79.86 Lac (Previous year Rs. 87.17 Lac) in the ordinary course of business and as per service rules of the Company.

Maximum amount outstanding from employees at any time during the year were Rs. 102.98 Lac (Previous year Rs. 98.57 Lac).

9. a) Sales include export incentives of Rs. 314.90 Lac (Previous year Rs. 205.80 Lac).

b) Discount includes Trade Discount Rs 5,198.92 Lac (Previous year Rs. 5,046.08 Lac) and other than Trade Discount Rs 10,060.76 Lac (Previous year Rs 9,922.03 Lac).

(b) Defined Benefit Plans -

Gratuity Expense Rs. 229.08 Lac (Previous year Rs. 497.60 Lac) has been recognized in "Salaries,Wages, Bonus and Gratuity etc." under Schedule 14.

Amount recognized as an expense and included in Schedule 14 & Note 23 below, item "Contribution to Provident and Other Funds" Rs. 487.27 Lac (Previous year Rs. 458.36 Lac).

Pending the issuance of Guidance Note from the Institute of Actuaries of India, the Company’s actuary has expressed his inability to reliably measure the provident fund liability.

(c) Defined Contribution Plans –

Amount recognized as an expense and included in Schedule 14 item "Contribution to Provident and Other Funds” Rs. 204.58 Lac (Previous year Rs. 192.61 Lac) for Superannuation Fund.

(d) Other long-term benefits –

Amount recognized as an expense and included in Schedule 14 item "Salaries, Wages, Bonus and Gratuity etc.” Rs. 208.35 Lac (Previous year Rs. 132.27 Lac) for long term compensated absences.

(e) The expected return on plan assets is determined considering several applicable factors mainly the composition of the plan assets held, assessed risk of assets management, historical results on plan assets and the policy for plan assets management.

(f) The estimates of future salary increase, considered in actuarial valuation, take account of infl ation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

11. (a) Miscellaneous Income includes dividend income of Rs. 227.18 Lac (Previous year Rs. 38.79 Lac).

(b) Interest Income includes Rs. 81.28 Lac (Previous year Rs. 77.16 Lac) on deposits with banks, Rs. 13.32 Lac (Previous year Rs. 86.12 Lacs) on Income Tax refund & Rs. 651.90 Lac (Previous year Rs. 667.44 Lac) on others.

13. Stocks of Stores & Spares and Raw Material include in-transit Rs. 75.48 Lac (Previous year Rs. 227.07 Lac).

14. Sundry Debtors exceeding six months are net of provisions for doubtful debts of Rs. 1,052.22 Lac (Previous year Rs. 1,006.86 Lac).

15. Future minimum lease payments under non-cancelable operating leases as on 31st March, 2011 are Rs. 17.70 Lac - Rs. 5.57 Lac within one year and Rs. 12.13 Lac later than one year but not later than fi ve years (Previous year Rs. 8.22 Lac - Rs. 8.22 Lac within one year and Nil later than one year but not later than fi ve years).

16. (a) Based on information so far available in respect of MSME (as defined in The Micro Small & Medium

Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the year. (b) The Balances of certain Advances, Security Deposits, Creditors and Other liabilities are in the process of confirmation/reconciliation.

17. Consumption of Stores, Spares and Chemicals is net of scrap sale of Rs. 438.13 Lac (Previous year Rs. 298.62 Lac).

18. (a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all

outstanding derivatives except covered under AS 11 (revised 2003) are mark to market on Balance Sheet date and there is gain of Rs. 47.25 Lac (reversal of previously recognised MTM Losses) (Previous year loss of Rs. 183.83 Lac) which has been recognized in Profit & Loss Account.

(c) Nominal amounts of Currency and Interest Rate Swaps for hedging entered into by the Company and outstanding at end of the year is Rs. 11,504.52 Lac (Previous year Rs. 12,706.88 Lac)

19. Research and Development expenditure amounting to Rs. 104.21 Lac (Previous year Rs. 88.24 Lac) has been charged to Profit and Loss Account.

25. Disclosure as required under Related Party Disclosures (AS 18) issued by The Institute of Chartered Accountants of India are as below: a) List of Related Parties

i. Subsidiaries (Wholly Owned)

- Songadh Infrastructure & Housing Ltd

- Jaykaypur Infrastructure & Housing Ltd ii. Associate

- JK Enviro-tech Limited

iii. Key Management Personnel (KMP)

- Shri Hari Shankar Singhania - Chairman

- Shri Harsh Pati Singhania - Managing Director

- Shri Om Prakash Goyal - Whole-time Director

iv. Enterprise over which KMPs have significant influence

- Habras International Limited

30. The Company has on 14th April, 2011, executed subscription agreements with certain multilateral fi nancial institutions, for the issuance of unsecured unlisted FCCBs (carrying interest rate of 6 month Euribor + 4.75%) for an aggregate amount not exceeding Euro 35 million (approximately Rs. 225 crores) on a private placement basis. The FCCBs which will be issued are convertible into equity shares of the Company at an initial conversion price of Rs. 65 per share, subject to price adjustment as per agreement, after 3 years and 6 months from the date of issue, and if FCCBs not converted than will be redeemed at par between 15th May, 2016 to 15th May, 2018.

31. The Company has filed Draft Letter of Offer for Right issue of shares on 31st Jan, 2011 to SEBI.

32. Previous years figures have been re-grouped/re-arranged wherever necessary.


Mar 31, 2010

1. Estimated amount of contracts remaining to be executed on capital account (Net of Advances) Rs. 1,139.98 Lac (Previous year Rs. 214.08 Lac).

2. Contingent liabilities in respect of claims not acknowledged as debts are as follows:

Rs. in lac (0.1 million) 31st March, 2010 31st March, 2009

a) Excise duty liability in respect of matters in appeal 271.91 300.95

b) Sales tax liability in respect of matters in appeals 182.27 249.84

c) Other Matters 1,199.15 1,553.86

Above claims are likely to be decided in favour of the company, hence, not provided for.

3. a) In respect of certain disallowances and additions made by the Income Tax Authorities, appeals are pending before the Appellate Authorities and adjustment, if any, will be made after the same are fi nally determined.

b) The Company has entered into a Take or Pay agreement for the purpose of sourcing lime from JK Enviro- tech Ltd. The Company has given an undertaking that on the happening of certain events, it will takeover Loan taken by JK Enviro-tech Ltd. from IDFC Ltd. of the value of Rs. 40 Crore.

4. In respect of levy of Octroi pertaining to Central Pulp Mills Unit by Songadh Group Gram Panchayat, the Company has paid Rs.125.07 Lac till 31st March 1997 under protest and also created a liability for the similar amount. As the matter is still pending in the court of law, the necessary adjustment, if any, would be made after its disposal.

5. The Scheme of Arrangement for transfer and vesting of CPM Staff Housing Undertaking of the Company to Songadh Infrastructure & Housing Limited and of JKPM Staff Housing Undertaking of the Company to Jaykaypur Infrastructure & Housing Limited has been fi led with the High Courts of Gujarat & Orissa for their approval, pursuant to Sections 391 to 394 of the Companies Act. Upon sanction of the said Scheme by the above said Courts, CPM Staff Housing Undertaking of the Company shall be transferred to Songadh Infrastructure & Housing Limited and JKPM Staff Housing Undertaking of the Company shall be transferred to Jaykaypur Infrastructure & Housing Limited w.e.f. the appointed date as per the said Scheme, i.e, April 1, 2009. Pending requisite approval, no effect has been given of the said scheme in these accounts.

6. The Company has only one business segment i.e. Paper and Boards and geographical reportable segment i.e. Operations within India, hence Segment Reporting as defi ned in Accounting Standard (AS–17) is not required.

7. Land, Roads, Buildings and Pulp Mill Plant & Machinery of Unit - Central Pulp Mills were revalued as on 30.09.1976. The revaluation in respect of these assets (other than Land and Roads) were updated and Plant & Machinery of Paper Machine I & II and Railway Sidings were revalued as on 31.3.1994 based on current replacement cost by the approved valuers appointed for the purpose. As a result, the book value of such assets has been increased by Rs. 4,227.24 Lac, which has been transferred to Revaluation Reserve during the year ended 31.3.1994.

8. Loans and Advances are net of provisions for doubtful advances of Rs. 53.04 Lac (Previous year Rs. 24.53 Lac) and includes loans of Rs. 2,848.45 Lac (previous year Rs. 3,198.45 Lac) to JK Paper Employees’ Welfare Trust, a shareholder of the Company, (includes concessional loans of Rs. 2,248.45 Lac (Previous year Rs. 2,398.45 Lac)), loans to JK Enviro-Tech Limited (an Associate) Rs. 2,739.27 Lac (Previous year Rs. 1,996.40 Lac) & to body corporate Rs. 50.00 Lac (Previous year Rs. 50.00 Lac) and loan to employees of Rs. 87.17 Lac (Previous year Rs. 49.15 Lac) in the ordinary course of business and as per service rules of the Company.

Maximum amounts outstanding from employees at any time during the year were Rs. 98.57 Lac (Previous year Rs. 71.43 Lac).

9. a) Sales include export incentives of Rs. 205.80 Lac (Previous year Rs. 285.56 Lac).

b) Discount includes Trade Discount Rs 5,046.08 Lac (Previous year Rs. 4,336.75 Lac) and other than Trade Discount Rs 9,922.03 Lac (Previous year Rs 8,272.79 Lac).

10. (a) Miscellaneous Income includes dividend income of Rs. 38.79 Lac (Previous year Rs. 1.74 Lac).

(b) Interest Income includes Rs. 77.16 Lac (Previous year Rs. 101.22 Lac) on deposits with banks, Rs. 86.12 Lac (Previous year Rs. 15.94 Lacs) on Income Tax refund & Rs. 667.44 Lac (Previous year Rs. 624.61 Lac) on others.

(c) Interest Expense in Schedule 17 includes Nil (Previous year Rs. 193.37) and other expenses in Schedule 16 includes Nil (Previous year Rs. 21.59 Lac) relates to prior-period.

11. Stocks of Stores & Spares and Raw Material include in-transit Rs. 227.07 Lac (Previous year Rs. 237.17 Lac).

12. Sundry Debtors exceeding six months are net of provisions for doubtful debts of Rs. 1,006.86 Lac (Previous year Rs. 412.71 Lac).

13. Future minimum lease payments under non-cancelable operating leases as on 31st March 2010 are Rs. 8.22 Lac - Rs. 8.22 Lac within one year and Nil later than one year but not later than fi ve years (Previous year Rs. 43.98 Lac - Rs. 28.60 Lac within one year and Rs. 15.38 Lac later than one year but not later than fi ve years).

14. (a) Based on information so far available with the company in respect of MSME (as defi ned in ‘The Micro Small & Medium Enterprises Developments Act, 2006) there is no delay in payment of dues to such enterprises during the year and there is no such dues payable at the end of the year.

(b) The Balances of certain Advances, Security Deposits, Creditors and Other liabilities are in the process of confi rmation/reconciliation

15. Consumption of Stores, Spares and Chemicals is net of scrap sale of Rs. 298.62 Lac (Previous year Rs. 297.42 Lac).

16. (a) In accordance with Announcement issued by the Institute of Chartered Accountants of India all outstanding derivatives except covered under AS 11 (revised 2003) are mark to market on Balance Sheet date and there is loss of Rs. 183.83 Lac (Previous year 63.21 Lacs) which has been recognized in Profi t & Loss Account.

(c) Nominal amounts of Currency and Interest Rate Swaps for hedging entered into by the Company and outstanding at year end is Rs. 12,706.88 Lac (Previous year Rs. 12976.55 Lac)

17. Research and Development expenditure amounting to Rs. 88.24 Lac (Previous year Rs. 61.68 Lac) has been charged to Profi t and Loss Account.

18. Disclosure as required under ‘Related Party Disclosures’ (AS 18) issued by The Institute of Chartered Accountants of India are as below: a. List of Related Parties i. Subsidiaries

- Songadh Infrastructure & Housing Ltd (Wholly Owned Subsidiary w.e.f 30th April 2009)

- Jaykaypur Infrastructure & Housing Ltd (Wholly Owned Subsidiary w.e.f 30th April 2009) ii. Associate

- JK Enviro-tech Limited

iii. Key Management Personnel (KMP)

- Shri Hari Shankar Singhania - Chairman

- Shri Harsh Pati Singhania - Managing Director

- Shri Om Prakash Goyal - Whole-time Director iv. Enterprise over which KMP’s have signifi cant infl uence

- Habras International Limited

19. Purchase of fi nished goods (Paper and Board) during the year 9,127 tonnes (Previous year – 23,060 tonnes).

20. Previous year’s fi gures have been re-grouped/re-arranged wherever necessary.

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