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Notes to Accounts of JSW Steel Ltd.

Mar 31, 2017

Notes:

1. To comply with the Companies (Accounting Standard) Rules, 2006, certain account balances have been regrouped as per the format prescribed under Division II of Schedule III to the Companies Act, 2013.

2. Finance lease arrangements:

In respect of certain long-term arrangements, existing at the date of transition and identified to be in the nature of finance lease where the Company is lessee, the underlying assets and corresponding finance lease obligation determined at the inception of respective arrangements have been recognized on the date of transition with the adjustment of difference, if any, in the opening retained earnings, resulting into increase in finance cost and depreciation charge and reduction in the cost of goods / services procured and valuation of underlying inventories. Such arrangements were recognized as per their legal form under the previous GAAP

3. Fair valuation of investments:

Investments in preference shares have been measured at fair value through profit or loss as against cost less diminution of other than temporary nature, if any, under the previous GAAP

Certain equity investments (other than investments in subsidiaries, joint ventures and associates) have been measured at fair value through other comprehensive income (FVTOCI).

The difference between the fair value and previous GAAP carrying value on transition date has been recognized as an adjustment to opening retained earnings / separate component of other equity.

4. Look through approach for employee welfare trust

Employee welfare trust, financed through interest free loan by the Company and warehousing the shares which have not vested yet, for distribution to employees of the Company, has been consolidated on line by line basis by reducing from equity share capital of the Company the face value of such treasury shares held by the trust and adjusting the difference, if any, into opening retained earnings.

5. Preference shares considered as borrowings:

Cumulative redeemable preference shares issued by the Company have been classified as borrowings and recognized at amortized cost on transition date as against part of Equity share capital under previous GAAP The difference on the transition date has been recognized in opening retained earnings net of related deferred taxes. Interest charge at effective interest rate on such borrowings has been recognized as finance cost in subsequent periods as against appropriation of dividend at coupon rate from reserves under the previous GAAP

6. Financial liabilities and related transaction costs:

Borrowings and other financial liabilities which were recognized at historical cost under previous GAAP have been recognized at amortized cost under IND AS with the difference been adjusted to opening retained earnings.

Under previous GAAP, transaction costs incurred in connection with borrowings were amortized equally over the tenure of the borrowings. Under IND AS, transaction costs are deducted from the initial recognition amount of the financial liability and charged over the tenure of borrowing using the effective interest method.

Difference in the un-amortized borrowing cost as per IND AS and previous GAAP on transition date has been adjusted to the cost of asset under construction or opening retained earnings, as applicable.

7. Financial assets at amortized cost:

Certain financial assets held on with an objective to collect contractual cash flows in the nature of principal and interest have been recognized at amortized cost on transition date as against historical cost under the previous GAAP with the difference been adjusted to the opening retained earnings.

8. Deferred tax as per balance sheet approach:

Under previous GAAP, deferred tax was accounted using the income statement approach, on the timing differences between the taxable profit and accounting profits for the period. Under IND AS, deferred tax is recognized following balance sheet approach on the temporary differences between the carrying amount of asset or liability in the balance sheet and its tax base. In addition, various transitional adjustments has also lead to recognition of deferred taxes on new temporary differences.

9. Dividend:

Under previous GAAP, dividends proposed by the board of directors after balance sheet date but before the approval of the financial statements were considered as adjusting events. However under IND AS, such dividends are recognized when the same is approved by the shareholders in the general meeting.

Accordingly the liability for proposed dividend recognized as on transition date has been reversed with corresponding adjustment to opening retained earnings and dividend in the subsequent period has been recognized in the year of approval in the general meeting.

10. Excise duty:

Under previous GAAP, revenue from sale of goods was presented net of excise duty whereas under IND AS the revenue from sale of goods is presented inclusive of excise duty. The excise duty is presented on the face of the Statement of Profit and Loss as part of expenses.

11. Defined benefit liabilities:

Under IND AS, Remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined liability, are recognized in other comprehensive income instead of profit or loss in previous GAAP

12. Government grant:

Government grant outstanding as on transition date relating to the purchase of fixed asset and conditional upon fulfillment of future export obligations has been recognized as deferred income under Ind AS with the corresponding adjustment to the carrying amount of Property, plant and equipment (net of cumulative depreciation impact) and opening retained earnings.

13. Other comprehensive income:

Under IND AS, all items of income and expense recognized in the period should be included in profit or loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss and "other comprehensive income" includes remeasurements of defined benefit plans, foreign currency monetary item translation difference account, effective portion of gains and losses on cash flow hedging instruments and fair value gain or losses on FVCTOCI equity instruments. The concept of other comprehensive income did not exist under previous GAAP


Mar 31, 2016

1. CONTINGENT LIABILITIES:

a) Bills discounted with re-course Rs. Nil (previous year Rs. 144.98 crores).

b) i) Guarantees provided on behalf of subsidiaries Rs. 2,124.11 crores (previous year Rs. 1,273.97 crores).

ii) Standby letter of credit facility availed from resident Indian Banks secured by specific fixed assets of the Company in relation to overseas long-term borrowing by JSW Steel Holding (USA) Inc and JSW Steel (Netherlands) B.V. (wholly owned subsidiaries of the Company) is Rs. 2,653.32 crores (previous year Rs. 2,503.63 crores) and Rs. 530.66 crores (previous year Rs. 1439.59 crores) respectively.

iii) Provision of Rs. 957.85 crores (previous year Rs. Nil) has been created against aforesaid guarantees and standby letter of credit facilities (refer note 25(4)(a)).

c) Disputed claims/levies (excluding interest, if any), in respect of:

(i) Excise duty Rs. 305.39 crores (previous year Rs. 466.88 crores);

(ii) Custom duty Rs. 407.92 crores (previous year Rs. 437.03 crores);

(iii) Income tax Rs. 170.68 crores (previous year Rs. 170.68 crores);

(iv) Sales tax / Special entry tax Rs. 155.94 crores (previous year Rs. 155.94 crores);

(v) Service tax Rs. 142.06 crores (previous year Rs. 146.54 crores);

(vi) Miscellaneous Rs. 0.05 crores (previous year Rs. 0.05 crores);

(vii) Levies by local authorities Rs. 3.04 crores (previous year Rs. 3.04 crores); and

(viii) Claims by suppliers and other parties Rs. 109.98 crores (previous year Rs. 350.80 crores)

d) Arrears of fixed cumulative dividend on preference shares (CPRS) Rs. 0.56 crores (previous year Rs. 0.51 crores).

e) Claims related to Forest Development Tax Rs. 966.98 crores (previous year Rs. 909.38 crores). (including FDT amount paid under protest Rs. 665 crores (previous year Rs. 665 crores)). In 2008, the State Government of Karnataka levied Forest Development Tax (FDT) treating iron ore as forest produce. In response to writ petitions filed by various stakeholders, the Hon''ble High Court of Karnataka granted partial relief vide judgement dated December 3, 2015. In view thereof, the State Government of Karnataka has stopped levying FDT with effect from January 29, 2016. The State Government of Karnataka has filed an appeal before the Hon''ble Supreme Court of India against the judgement. The Hon''ble Supreme Court while hearing the petition on April 12, 2016 admitted the appeal, and granted an interim stay on refund of the FDT. The matter is posted for final arguments in the month of August 2016.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 5,064.37 crores (previous year Rs. 6,177.96 crores).

3. OTHER COMMITMENTS :

(a) The Company from time to time provides need based support to subsidiaries and joint ventures entity towards capital and other requirements.

(b) The Company has imported capital goods under the export promotion capital goods scheme to utilise the benefit of a zero or concessional customs duty rate. These benefits are subject to future exports within the stipulated period. Such export obligations at year end aggregate to Rs. 1,316.22 crores (previous year Rs. 628.25 crores).

4. EXCEPTIONAL ITEMS COMPRISE PROVISION TOWARDS :

a) (i) Rs. 982.37 crores (Rs. 333.75 crores for the year ended 31 March, 2015) for ''other than temporary'' diminution in value of investments relating to JSW Steel USA Inc., JSW Panama Holding Corporation, and Periama Holding LLC, subsidiaries of the Company; (ii) Rs. 3,915.30 crores (Rs. nil for the year ended 31 March, 2015) for loans to the said subsidiaries and interest thereon considered doubtful of recovery; and (iii) Rs. 957.85 crores (Rs. nil for the year ended 31 March, 2015)*; towards certain guarantees for borrowings by the said subsidiaries, which provisions are recognised based on estimate of values of the businesses/ assets of the said subsidiaries by independent External Valuers and based on cash flow projections. In making the said projections, reliance has been placed on estimates in respect of future prices of coal and iron ore, mineable resources, and assumptions relating to operational performance including improvement in capacity utilisation of the plants and margins, and availability of infrastructure for mines.

* amount used/unused amount reversed during the period Rs. nil

b) Pursuant to the order of the Honourable Supreme Court dated 24 September 2014 regarding cancellation of the allotment of coal blocks, the Company has made an assessment of investments in and loans and advances to the subsidiaries, joint ventures and associates affected by the said order and recognised provision of Rs. 4.19 crores (Rs. 21.20 crores for the year ended 31 March 2015) against carrying amount of investments as Exceptional Item during the year considering the principle of conservatism.

c) Based on careful evaluation of estimated projections, the management has recognised provision for diminution of other than temporary nature of Rs. 0.74 crores (Previous year Rs. 41.35 crores) in the carrying amount of investment in certain subsidiaries as Exceptional Item during the year.

5. In respect of certain investments/ loans and advances, following basis/assumptions/estimates have been considered in concluding that there is no further decline, other than temporary, in the value of the investments and that the loans / advances are fully recoverable:

a) Equity shares of JSW Steel Bengal Limited, a subsidiary (carrying amount: Rs. 436.15 crores (net of provision) as at March 31, 2016).

Evaluation of the status of its integrated Steel Complex (including power plant) to be implemented in phases at Salboni of district Paschim Medinipur in West Bengal by the said subsidiary, and the projections relating to the said complex considering estimates in respect of future raw material prices, foreign exchange rates, operating margins, etc. and the plans for commencing construction of the said complex.

b) Equity shares of Peddar Realty Private Limited (PRPL) (carrying amount of investments: Rs. 56.72 crores (net of provision) as at March 31, 2016), and recoverability of loans of Rs. 158.18 crores as at March 31, 2016.

Valuation by an independent valuer of the residential complex in which PRPL holds interest.

c) Investment of Rs. 4.51 crores (net of provision) and loan of Rs. 112.42 crores as at March 31, 2016 relating to JSW Natural Resources Mozambique Limitada and JSW ADMS Carvo Limitada (step down subsidiaries).

Assessment of minable reserves by independent experts and cash flow projections based on the plans to commence operations after mining lease arrangements are in place for which application has been submitted to regulatory authorities and infrastructure is developed.

d) Equity shares of JSW Severfield Structures Limited, a joint venture (JV) (carrying amount: Rs. 115.44 crores as at March 31, 2016).

Cash fow projections approved by the said JV which are based on estimates and assumptions relating to order book, capacity utilisation, operational performance, market prices of materials, inflation, terminal value, etc.

6. (a) Pursuant to the requirement under Schedule II to the Companies Act, 2013 the Company has, based on the external technical advice, effective 1 April, 2015, identified components (significant parts) of the main asset having different useful lives as compared to the main asset and consequently revised the estimated useful lives of Plant & Machinery and Buildings. Accordingly, the depreciation charge for the year ended 31 March 2016 is lower by Rs. 499.07 crores, and amount of Rs. 109.98 crores (net of deferred tax) being effect of componentization, where the remaining useful life of the asset was determined to be nil, has been adjusted against the retained earnings as per transitional provision in Note 7 (b) of Schedule II.

(b) Effective from 1 April 2014, the Company had re- worked depreciation with reference to the estimated useful lives of fixed assets prescribed under Schedule II to the Act or useful life of fixed assets as per technical evaluation. As a result the charge for depreciation was lower by Rs. 207.30 crores for the year ended March 31, 2015. Pursuant to the transition provisions prescribed in Schedule II to the Companies Act, 2013, the Company had fully depreciated the carrying value of assets, net of residual value, where the remaining useful life of the asset was determined to be nil as on April 1, 2014, and had adjusted an amount of Rs. 47.29 crores (net of deferred tax) against the opening Surplus balance in the Statement of Profit and Loss under Reserves and Surplus.

7. Trade receivables include Rs. 159.54 crores (previous year Rs.172.04 crores) recoverable from a customer towards supply of steel. The Company recovered an amount of Rs. 12.50 crores from the customer during the year ended 31 March 2016. Pursuant to the Consent Term, fled by the Company and the customer with the Honorable Bombay High Court and adopted by the Court as its order, the receivables of the Company shall be secured by a first ranking pari-passu charge over the fixed assets of the customer and shall be at par with other CDR lenders. The process of creating charge by the Company over the customer''s certain fixed assets has been completed and the charge creation for the remaining fixed assets is under progress. Based on these developments, the Company is reasonably confident about the recoverability of the said amount.

8. DERIVATIVES:

a) The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments, highly probable forecast transactions and foreign currency required at the settlement date of certain receivables/payables. The use of foreign currency forward contracts is governed by the Company''s strategy approved by the board of directors, which provide principles on the use of such forward contracts consistent with the Company''s risk management policy.

b) The Company also uses derivative contracts other than forward contracts to hedge the interest rate and currency risk on capital account. Such transactions are governed by the strategy approved by the board of directors, which provide principles on the use of these instruments, consistent with the Company''s risk management policy. The Company does not use these contracts for speculative purposes.

9. RELATED PARTIES RELATIONSHIPS, TRANSACTIONS AND BALANCES :

A) LIST OF RELATED PARTIES

1 SUBSIDIARIES

JSW Steel (Netherlands) B.V.

JSW Steel (UK) Limited

Argent Independent Steel (Holdings) Limited (ceased w.e.f 17/11/2015)

JSW Steel Service Centre (UK) Limited

JSW Steel Holding (USA) Inc.

JSW Steel (USA) Inc.

Periama Holdings, LLC

Purest Energy, LLC

Meadow Creek Minerals, LLC

Hutchinson Minerals, LLC

R.C. Minerals, LLC

Keenan Minerals, LLC

Peace Leasing, LLC

Prime Coal, LLC

Planck Holdings, LLC

Rolling S Augering, LLC

Periama Handling, LLC

Lower Hutchinson Minerals, LLC

Caretta Minerals, LLC

JSW Panama Holdings Corporation

Inversiones Eroush Limitada

Santa Fe Mining

Santa Fe Puerto S.A.

JSW Natural Resources Limited

JSW Natural Resources Mozambique Limitada

JSW ADMS Carvo Lda

JSW Mali Resources SA (ceased w.e.f 18.06.2015)

JSW Steel Processing Centre Limited

JSW Bengal Steel Limited

JSW Natural Resources India Limited

Barbil Beneficiation Company Limited

Barbil Iron Ore Company Limited

JSW Jharkhand Steel Limited

JSW Steel East Africa Limited

Amba River Coke Limited

JSW Energy (Bengal) Limited

JSW Natural Resource Bengal Limited

JSW Steel Coated Products Limited

Peddar Realty Private Limited

Nippon Ispat Singapore (PTE) Limited

Erebus Limited

Arima Holding Limited

Lakeland Securities Limited

JSW Steel (Salav) Limited (w.e.f 31.10.2014)

Everbest Steel & Mining Holdings Limited (w.e.f. 13.02.2015) (ceased w.e.f 04.12.2015)

2 ASSOCIATES

JSW Praxair Oxygen Private Limited

Dolvi Minerals & Metals Private Limited (w.e.f. 27.11.2014)

Dolvi Coke Projects Limited (w.e.f. 04.12.2014)

3 JOINT VENTURES

Vijayanagar Minerals Private Limited

Rohne Coal Company Private Limited

JSW Severfeld Structures Limited

Gourangdih Coal Limited

Toshiba JSW Power System Private Limited

MJSJ Coal Limited

GEO Steel LLC

JSW Structural Metal Decking Limited

JSW MI Steel Service Centre Private Limited

JSW Vallabh Tin Plate Private Limited (w.e.f. 07.04.2014)

4 KEY MANAGEMENT PERSONNEL (KMP)

Mr. Sajjan Jindal

Mr. Seshagiri Rao M V S

Dr. Vinod Nowal

Mr. Jayant Acharya

Mr. Rajeev Pai

Mr. Lancy Varghese

5 RELATIVE OF KEY MANAGERIAL PERSONNEL

Mr. Parth Jindal

6 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL AND RELATIVES OF SUCH PERSONNEL EXERCISE SIGNIFICANT INFLUENCE

JSW Energy Limited

Jindal Stainless Limited

JSW Realty & Infrastructure Private Limited

Jindal Saw Limited

Jindal Saw USA LLC

Jindal Steel & Power Limited

JSOFT Solutions Limited

Jindal Industries Private Limited

JSW Cement Limited

JSW Jaigarh Port Limited

Reynold Traders Private Limited

Raj West Power Limited

JSW Power Trading Company Limited

JSW Infrastructure Limited

South West Port Limited

JSW Techno Projects Management Limited

JSW Global Business Solutions Limited (Formerly known as Sapphire Technologies Limited)

South West Mining Limited

JSL Architecture Limited

JSW Projects Limited

JSW Foundation

O P Jindal Foundation

Jindal Technologies & Management Services Private Limited

JSW Dharamatar Port Private Limited

Jindal Tubular (India) Limited

M/s Shadeed Iron & Steel Co. LLC

JSW Investment Private Limited

JSW IP Holdings Private Limited (w.e.f. 01.04.2015)

Epsilon Carbon Private Limited (Formerly known as AVH Private Limited)

JSW International Trade Corp PTE Limited

Heal Institute Private Limited

JSL Lifestyle Limited

Jindal Power Limited

Jindal Fittings Limited

Jindal Education Trust

10. OPERATING LEASE

A) AS LESSOR:

i. The Company has entered into lease arrangements, for renting :

- 2,279 houses (admeasuring approximately 1,410,997 square feet) at the rate of Rs. 100/- per house per annum, for a period of 120 months.

- 9 houses (admeasuring approximately 9,027 square feet) at the rate of Rs. 43/- per square feet per month per house, for a period of 60 months.

- Office premises (admeasuring approximately 1795 square feet) at the rate of Rs. 146/- square feet for the period of 22 months.

The agreements are renewable at the option of the lessee after the end of the lease term.

ii. Disclosure in respect of assets (building) given on operating lease:

The agreements are executed for a period of 11 to 180 months with a renewable clause and also provide for termination at will by either party giving a prior notice period of 1 to 3 months.

(ii) The agreements for certain plant and equipment is on non-cancellable basis for a period of 10-15 years, which are renewable on expiry of the lease period at mutually acceptable terms.

11. THE COMPANY HAS THE FOLLOWING JOINT VENTURE INTEREST IN INDIA AS AT 31ST MARCH 2016: INTEREST AS VENTURER IN JOINTLY CONTROLLED ENTITIES

Vijayanagar Minerals Private Limited: Percentage of holding-40% (previous year 40%) Rohne Coal Company Private Limited: Percentage of holding–49% (previous year 49%) JSW Severfield Structures Limited: Percentage of holding-50% (previous year 50%) Gourangdih Coal Limited: Percentage of holding–50% (previous year 50%) JSW MI Steel Service Center Private Limited: Percentage of holding-50% (previous year 50%) JSW Vallabh Tinplate Private Limited: Percentage of holding–50% (previous year 50%)

INTEREST AS INVESTOR

MJSJ Coal Limited: Percentage of holding–11% (previous year 11%)

Toshiba JSW Power Systems Private Limited: Percentage of holding–2.48% (previous year 2.48%)

15. FIGURES OF THE PREVIOUS YEAR ARE REGROUPED AND RECLASSIFIED WHEREVER NECESSARY TO CORRESPOND TO FIGURES OF THE CURRENT YEAR.


Mar 31, 2014

Note 1

1. Contingent liabilities :

a) Bills discounted Rs. 3,285.56 crores (previous year Rs. 3,012.92 crores).

b) Guarantees provided to banks on behalf of subsidiaries Rs. 1,372.57 crores (previous year Rs. 1,223.95 crores).

c) Standby letter of credit facility availed from resident Indian Banks secured / to be secured by specific fixed assets of the company in relation to overseas long term borrowing by JSW Steel Holding (USA) Inc and JSW Steel (Netherlands) B.V. (wholly owned subsidiaries of the company) is Rs. 2,403.99 crores (previous year nil) and Rs. 480.80 crores (previous year nil) respectively.

d) Disputed claims/levies (excluding interest, if any), in respect of: (i) Excise duty Rs. 441.95 crores (previous year Rs. 199.82 crores); (ii) Custom duty Rs. 460.12 crores (previous year Rs. 632.76 crores); (iii) Income tax Rs. 1.74 crores (previous year Rs. 1.47 crores);

(iv) Sales tax / Special entry tax Rs. 223.37 crores (previous year Rs. 226.93 crores);

(v) Service tax Rs. 129.25 crores (previous year Rs. 98.10 crores);

(vi) Miscellaneous Rs. 0.05 crores (previous year Rs. 0.05 crores);

(vii) Levies by local authorities Rs. 3.04 crores (previous year Rs. 3.04 crores); and

(viii) Claims by suppliers and other parties (including for Forest Development Tax of Rs. 669.54 crores (previous year Rs. 650.75 crores)) Rs. 1039.60 crores (previous year Rs. 872.79 crores)

In 2008, the State of Karnataka levied a Forest Development Tax (FDT) treating iron ore as a forest produce. Writ petitions filed by various stakeholders challenging the levy before Karnataka High Court are pending disposal. The Management of the Company has been legally advised that this is a fairly arguable case from the company''s perspective and accordingly, the tax is considered as recoverable. Tax payments made under protest in the earlier years (refer note 14) / tax payable are considered as ''contingent liabilities''.

e) Arrears of fixed cumulative dividend on preference shares (CPRS) Rs. 0.46 crores.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 3,176.36 crores (previous year Rs. 3,217.49 crores).

3. Other commitments :

(a) The Company from time to time provides need based support to subsidiaries and joint ventures entity towards capital and other requirements.

(b) The Company has imported capital goods under the export promotion capital goods scheme to utilise the benefit of a zero or concessional customs duty rate. These benefits are subject to future exports. Such export obligations at year end aggregate to Rs. 3,817.11 crores (previous year Rs. 10,903.50 crores) by the Company within the stipulated period.

4. On May 3, 2013 the Bombay High Court sanctioned a Composite Scheme of Amalgamation and Arrangement (Scheme) under Sections 391 to 394 of the Companies Act, 1956 amongst JSW Steel Limited, JSW Ispat Steel Limited, JSW Building Systems Limited, JSW Steel Coated Products Limited and their respective shareholders and creditors with July 1, 2012 being the appointed date. The certified copy of the scheme is filed with the Registrar of Companies (RoC) on June 1, 2013. Accordingly, effect of the scheme is considered in the financial statements of the current year.

In terms of the scheme, effectively, from July 1, 2012:

- The Vasind and Tarapur units of JSW Steel Limited and the Kalmeshwar unit of JSW Ispat Steel Limited were demerged and their businesses transferred and vested to JSW Steel Coated Products Limited.

- The residual JSW Ispat Steel Limited was merged with JSW Steel Limited.

- JSW Steel Coated Products Limited emerged as a subsidiary of JSW Steel Limited.

- Accordingly, an amount of Rs. 341.95 crores for the period July 1, 2012 to March 31, 2013, have been debited to the reserve & surplus under surplus in statement of profit and loss.

This amalgamation is an amalgamation in the nature of purchase as defined by Accounting Standard 14 – Accounting for Amalgamations specified in the Companies (Accounting Standards) Rules 2006. Entries have been passed in the books of account of the Company to give effect to the scheme, as follows:

With effect from the appointed date,

(a) All the assets and liabilities of residual JSW Ispat and JSW Building vest in and are transferred to the Company and recorded at their respective fair values.

(b) 1,86,08,844 equity shares of Rs. 10 each at par are issued to the equity shareholders of JSW Ispat in the ratio of 1 equity share of the company for every 72 equity shares of JSW Ispat.

(c) 48,54,14,604 ,0.01% preference shares of Rs. 10 each are issued to the preference shareholders of JSW Ispat in the ratio of 1 preference share for every preference share of JSW Ispat.

(d) Inter-company investments and balances, between the company, JSW Building and residual JSW Ispat stand cancelled.

(e) Assets and liabilities related to the Vasind and Tarapur units of the company are transferred to and vested in JSW Steel Coated.

(f) The difference of Rs. 3,055.12 crores resulting from the above is credited to the capital reserve account.

5. In view of the losses from operations of, JSW Steel USA Inc, a subsidiary of the Company for last few years, the Company has considered valuations of its fixed assets carried out by an independent valuer and concluded that no provision is presently necessary against the carrying amounts of investments and loans aggregating to Rs. 2,007.46 crores and with respect to financials guarantees of Rs. 2,752.57 crores [included under contingent liabilities – note 26 (1) [(b) and (c)], relating to the said subsidiary.

6. The carrying amount of investment in equity shares of JSW Severfield, India, a joint venture (JV) of the Company, is Rs. 98.44 crores as at March 31, 2014. Having regard to its continued operating losses and current external economic environment, the Management of the Company has assessed whether the decline in the value of the said investment is ''other than temporary'' in terms of Accounting Standard (AS) 13, Investments. On a careful evaluation of the business plans of the JV and expected profits based thereon, it has been concluded that the decline is temporary and accordingly, no provision is required.

7. Trade receivable includes Rs. 184.02 crores (previous year Rs. 184.02 crores) recoverable from a customer towards supply of steel. The customer has applied for corporate debt restructuring to CDR Cell and mentioned JSW Steel as their "critical and essential supplier" whose dues needs to be paid on priority basis. The scheme was approved by CDR empowered group during the year. Based on these developments, the Company is reasonably confident about the recoverability of the said amount.

8. Exceptional items represents effect of significant movement and volatility in the value of the Indian rupee against US dollar.

9. Derivatives:

a) The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The use of foreign currency forward contracts is governed by the Company''s strategy approved by the Board of Directors, which provide principles on the use of such forward contracts consistent with the Company''s Risk Management Policy.

b) The Company also uses derivative contracts other than forward contracts to hedge the interest rate and currency risk on capital account. Such transactions are governed by the strategy approved by the Board of Directors, which provide principles on the use of these instruments, consistent with the Company''s Risk Management Policy. The Company does not use these contracts for speculative purposes.

10. Employee benefits:

A) Defined contribution plan:

Company''s contribution to provident fund Rs. 29.10 crores. (previous year Rs. 25.62 crores)

11. Segment reporting:

The company is primarily engaged in the business of manufacture and sale of iron and steel products. The company has identified two primary business segments, namely steel and power (used mainly for captive consumption), which in the context of Accounting Standard 17 on "segment reporting" constitute reportable segments.

12. Related parties disclosure as per Accounting Standard (AS)-18 :

Parties with whom the company has entered into transactions during the period where control exists :

1 Subsidiaries

JSW Steel (Netherlands) B.V.

JSW Steel (UK) Limited

Argent Independent Steel (Holdings) Limited

JSW Steel Service Centre (UK) Limited

JSW Steel Holding (USA) Inc.

JSW Steel (USA) Inc.

Periama Holdings, LLC

Purest Energy, LLC

Meadow Creek Minerals, LLC

Hutchinson Minerals, LLC

R.C. Minerals, LLC

Keenan Minerals, LLC

Peace Leasing, LLC

Prime Coal, LLC

Planck Holdings, LLC

Rolling S Augering, LLC

Periama Handling, LLC

Lower Hutchinson Minerals, LLC

Caretta Minerals, LLC

JSW Panama Holdings Corporation

Inversiones Eroush Limitada

Santa Fe Mining

Santa Fe Puerto S.A.

JSW Natural Resources Limited

JSW Natural Resources Mozambique Limitada

JSW ADMS Carvo Lda

JSW Mali Resources SA (w.e.f 18.02.13)

JSW Steel Processing Centres Limited

JSW Bengal Steel Limited

JSW Natural Resources India Limited

Barbil Beneficiation Company Limited

JSW Jharkhand Steel Limited

JSW Steel East Africa Limited

Amba River Coke Limited

JSW Energy (Bengal) Limited

JSW Natural Resource Bengal Limited (w.e.f. 3.04.2012)

JSW Steel Coated Products Limited (w.e.f. 31.08.2012)

Peddar Realty Private Limited (w.e.f. 16.05.2012)

Nippon Ispat Singapore (PTE) Limited

EREBUS Limited

Arima Holding Limited

Lakeland Securities Limited

2 Associates

Jindal Praxair Oxygen Company Private Limited

JSW Ispat Steel Limited [Refer Note 26(4)]

3 Joint Ventures

Vijayanagar Minerals Private Limited

Rohne Coal Company Private Limited

JSW Severfield Structures Limited

Gourangdih Coal Limited

Toshiba JSW Power Systems Private Limited

MJSJ Coal Limited

GEO Steel LLC

JSW Structural Metal Decking Limited

JSW MI Steel Service Center Private Limited

4 Key Management Personnel (KMP)

Mr. Sajjan Jindal Mr. Seshagiri Rao M V S Dr. Vinod Nowal Mr. Jayant Acharya

5 Relative of Key Managerial Personnel

Mr. Parth Jindal

6 Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influence.

JSW Energy Limited

Jindal Stainless Limited

JSW Realty & Infrastructure Private Limited

Jindal Saw Limited

Jindal Steel & Power Limited

JSOFT Solutions Limited

Jindal Industries Limited

JSW Cement Limited

JSW Jaigarh Port Limited

Reynold Traders Private Limited

Raj West Power Limited

JSW Power Trading Company Limited

JSW Aluminim Limited (ceased from 15.10.2013)

O P Jindal Foundation

JSW Infrastructure Limited

South West Port Limited

JSW Techno Projects Management Limited

South West Mining Limited

JSL Architecture Limited

JSW Projects Limited

Sapphire Technologies Limited

Jindal Technologies & Management Services Private Limited

JITF Shipping & Logistics (Singapore) PTE Limited

JSW Foundation

JSW Bengaluru Football Club Private Limited

Shadeed Iron & Steel Co. LLC

15. Operating lease

a) As lessor:

i. The company has entered into lease arrangements, for renting :

2,279 houses (admeasuring approximately 1,410,997 square feet) at the rate of Rs. 100/- per house per annum, for a period of 120 months.

9 houses (admeasuring approximately 9,027 square feet) at the rate of Rs. 43/- per square feet per month per house, for a period of 60 months.

The agreements are renewable at the option of the lessee after the end of the lease term.

13. The company has the following joint venture interest in India as at 31 March 2014: Interest as venturer

Vijayanagar Minerals Private Limited: Percentage of holding – 40% (previous year 40%) Rohne Coal Company Private Limited: Percentage of holding – 49% (previous year 49%)

JSW Severfield Structures Limited: Percentage of holding - 50 % (previous year 50%)

Gourangdih Coal Limited: Percentage of holding – 50 % (previous year 50%)

JSW MI Steel Service Center Private Limited: Percentage of holding - 50% (previous year 50%)

Interest as investor

MJSJ Coal Limited: Percentage of holding – 11% (previous year 11%)

Toshiba JSW Power Systems Private Limited: Percentage of holding – 2.54% (previous year 2.54%)

14. Interest includes Rs. 5.96 crores (previous year Rs. 2.89 crores) on account of shortfall in payment of direct taxes.

15. Figures of the previous year are regrouped and reclassified wherever necessary to correspond to figures of the current year. Figures of the previous year are not comparable on account of Composite Scheme of Amalgamation and Arrangement as referred to in Note 26 (4) above.


Mar 31, 2013

1. Contingent Liabilities not provided for in respect of :

a) Bills Discounted Rs. 3,012.92 crores (Previous year Rs. 3,117.13 crores).

b) Guarantees provided to banks on behalf of subsidiaries Rs. 1,223.95 crores (Previous year Rs. 1,096.27 crores).

c) Disputed claims/levies (excluding interest, if any), in respect of:

(i) Excise Duty Rs. 199.82 crores (Previous year Rs. 200.27 crores);

(ii) Custom Duty Rs. 632.76 crores (Previous year Rs. 477.44 crores);

(iii) Income Tax Rs. 1.47 crores (Previous year Rs. 1.47 crores);

(iv) Sales Tax / Special Entry tax Rs. 226.93 crores (Previous year Rs. 170.30 crores);

(v) Service Tax Rs. 98.10 crores (Previous year Rs. 70.08 crores);

(vi) Miscellaneous Rs. 0.05 crores (Previous year Rs. 0.05 crores);

(vii) Levies by local authorities Rs. 3.04 crores (Previous year Rs. 3.04 crores); and

(viii) Claims etc. by suppliers and other parties (including for Forest Development Tax) Rs. 872.79 crores (Previous year Rs. 509 crores)

In 2008, the State of Karnataka levied a Forest Development Tax (FDT) treating iron ore as a forest produce. Writ Petitions challenging the levy of FDT filed before Karnataka High Court by various stakeholders are pending for disposal. Accordingly, the Company has disclosed in the financial statements FDT paid under protest of Rs. 650.75 crores (including under e auction) as an advance and Rs. 866.03 crores (above) as a contingent liability.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 3,217.49 crores (Previous year Rs. 3,729.12 crores).

3. Other Commitments :

(a) The company has issued an undertaking to associate bankers for non disposal of its investment of Rs. 2,357.11 crores (Previous year Rs. 2,357.11) in an associate till that entity repays its debts.

(b) The Company from time to time provides need based support to subsidiaries and a joint venture entity towards capital and other requirements.

(c) The company has imported capital goods under the Export Promotion Capital Goods Scheme to utilise the benefit of a zero or concessional customs duty rate. These benefits are subject to future exports. Such export obligations at year end aggregate to Rs. 10,903.50 crores (Previous year Rs. 16,912.59 crores) by the company within the stipulated period.

4. On 3rd May 2013 the Bombay High Court sanctioned a Composite Scheme of Amalgamation and Arrangement under sections 391 to 394 of the Companies Act, 1956 amongst JSW Steel Limited, JSW ISPAT Steel Limited, JSW Building Systems Limited, JSW Steel Coated Products Limited and their respective shareholders and creditors with effect from 1 July 2012, being the appointed date. The certified copy of the Court Order is awaited, on receipt of which the Company will initiate requisite formalities to give effect to the Scheme. Accordingly therefore, the accounting treatment laid out in the Scheme and consequential adjustments that would arise will be dealt with by the Company in the financial statements, once the Scheme is implemented.

5. In respect of the Company''s long term, strategic investment in one of its subsidiaries, JSW Steel (USA) Inc., the Company periodically reviews and assesses its business plans and expected future cash flows. The company has also considered recent independent valuations of the underlying fixed assets. Whilst the subsidiary may have a longer gestation period than originally envisaged, the Company has concluded that the decline is temporary and no provision against the carrying amounts of investments and loans of Rs. 3,155.65 crores relating to the subsidiary is presently necessary.

6. Due to the significant movement and volatility in the value of the rupee against US dollar, the net foreign exchange loss has been considered by the Company as exceptional in nature.

7. Derivatives:

a) The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The use of foreign currency forward contracts is governed by the Company''s strategy approved by the Board of Directors, which provide principles on the use of such forward contracts consistent with the Company''s Risk Management Policy

b) The Company also uses derivative contracts other than forward contracts to hedge the interest rate and currency risk on capital account. Such transactions are governed by the strategy approved by the Board of Directors, which provide principles on the use of these instruments, consistent with the Company''s Risk Management Policy. The Company does not use these contracts for speculative purposes.

11. Employee Benefits:

a) Defined Contribution Plan:

Company''s contribution to Provident Fund Rs. 25.62 crores. (Previous Year Rs. 24 crores)

The Company expects to contribute Rs. 37.09 crores (previous year Rs. 23.66 crores) to its Gratuity Plan for the next year. In assessing the Company''s Post Retirement Liabilities, the Company monitors mortality assumptions and uses up-to-date mortality tables, the base being the Indian Assured Lives Mortality (2006-08) Ultimate.

Expected return on plan assets is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligations.

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

(ii) Provident Fund:

The company makes monthly contributions to Provident Fund managed by Trust for qualifying employees. Under the scheme, the company is required to contribute a specified percentage of the payroll costs to fund the benefits.

In keeping with the Guidance on Implementing Accounting Standard (AS) 15 (Revised) on Employee Benefits notified by the Companies (Accounting Standards) Rules, 2006, employer established provident fund trusts are treated as Defined Benefit Plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the Defined Benefit Obligation of Interest rate Guarantee on exempted Provident Fund in respect of employees of the company as at 31st March, 2013 works out to Rs. Nil (previous year Rs. Nil) and hence no provision is required to be provided for in the books of accounts towards the guarantee given for notified interest rates.

8. Segment Reporting:

The Company is primarily engaged in the business of manufacture and sale of Iron and Steel Products. The Company has identified two primary business segments, namely Steel and Power (used mainly for captive consumption), which in the context of Accounting Standard 17 on "Segment Reporting" constitute reportable segments.

9. Related Parties disclosure as per Accounting Standard (AS) - 18:

A) List of Related Parties

Parties with whom the Company has entered into transactions during the period where control exists :

1 Subsidiaries

JSW Steel (Netherlands) B.V.

JSW Steel (UK) Limited

Argent Independent Steel (Holdings) Limited

JSW Steel Service Centre (UK) Limited

JSW Steel Holding (USA) Inc.

JSW Steel (USA) Inc.

Periama Holdings, LLC

Purest Energy, LLC

Meadow Creek Minerals, LLC

Hutchinson Minerals, LLC

R.C. Minerals, LLC

Keenan Minerals, LLC

Peace Leasing, LLC

Prime Coal, LLC

Planck Holdings, LLC

Rolling S Augering, LLC

Periama Handling, LLC

Lower Hutchinson Minerals, LLC

Caretta Minerals, LLC

JSW Panama Holdings Corporation

Inversiones Eroush Limitada

Santa Fe Mining

Santa Fe Puerto S.A.

JSW Natural Resources Limited

JSW Natural Resources Mozambique Limitada

JSW ADMS Carvo Lda

JSW Mali Resources SA (w.e.f. 18.02.2013)

JSW Steel Processing Centres Limited

JSW Bengal Steel Limited

JSW Natural Resources India Limited

Barbil Beneficiation Company Limited

JSW Jharkhand Steel Limited

JSW Building Systems Limited

JSW Steel East Africa Limited

Amba River Coke Limited

JSW Energy (Bengal) Limited

JSW Natural Resource Bengal Limited (w.e.f. 03.04.2012)

JSW Steel Coated Products Limited (w.e.f. 31.08.2012)

2 Associates

Jindal Praxair Oxygen Company Private Limited

JSW Ispat Steel Limited

JSW Energy (Bengal) Limited (upto 04.03.2012)

3 Joint Ventures

Vijayanagar Minerals Private Limited

Rohne Coal Company Private Limited

JSW Severfield Structures Limited

Gourangdih Coal Limited

Toshiba JSW Turbine and Generator Private Limited

MJSJ Coal Limited

GEO Steel LLC

JSW Structural Metal Decking Limited

JSW MI Steel Service Center Private Limited

4 Key Management Personnel (KMP)

Mr. Sajjan Jindal

Mr. Seshagiri Rao M V S

Dr. Vinod Nowal

Mr. Jayant Acharya

5 Relative of Key Managerial Personnel

Mrs. Savitri Devi Jindal

Mr. Parth Jindal

6 Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influence.

JSW Energy Limited

JSL Limited

JSW Realty & Infrastructure Private Limited

Jindal Saw Limited

Jindal Steel & Power Limited

JSOFT Solutions Limited

Jindal Industries Limited

Jindal Aluminum Limited

JSW Cement Limited

JSW Jaigarh Port Limited

Reynold Traders Private Limited

Raj West Power Limited

JSW Power Trading Company Limited

JSW Aluminim Limited

O P Jindal Foundation

JSW Infrastructure Limited

South West Port Limited

JSW Techno Projects Management Limited

South West Mining Limited

JSL Architecture Limited

JSW Projects Limited

Sapphire Technologies Limited

Jindal Technologies & Management Services Private Limited

10. Operating Lease

a) As Lessor:

i. The Company has entered into lease arrangements, for renting :

2,279 houses (admeasuring approximately 1,410,997 square feet) at the rate ofRs. 100/-perhouseperannum, for a period of 180 months.

684 houses (admeasuring approximately 350,103 square feet) at the rate of Rs. 24/- per square feet per annum, for a period of 36 to 60 months.

9 houses (admeasuring approximately 9,027 square feet) at the rate of Rs. 43/- per square feet per month per house, for a period of 60 months.

Office premises (part) admeasuring approximately 15,392 square feet at the rate of Rs. 130 per square feet for a period of 11 months.

The agreements are renewable at the option of the lessee after the end of the lease term.

11. The Company has the following Joint venture interest in India as at 31st March 2013:

Interest as Venturer

Vijayanagar Minerals Private Limited: Percentage of holding - 40% (Previous year 40 %)

Rohne Coal Company Private Limited: Percentage of holding - 49% (Previous year 49 %)

JSW Severfield Structures Limited : Percentage of holding - 50 % (Previous Year 50%)

Gourangdih Coal Limited : Percentage of holding - 50 % (Previous Year 50 %)

JSW MI Steel Service Center Private Limited : Percentage of holding - 50% (Previous Year 50% )

Interest as Investor

MJSJ Coal Limited: Percentage of holding - 11% (Previous year 11 %)

Toshiba JSW Turbine and Generator Private Limited : Percentage of holding - 2.54% (Previous year 3.67%)

12. Interest includes Rs. 2.89 crores (previous year Rs. 2.5 crores) on account of shortfall in payment of Direct Taxes.

13. Comparative financial information (i.e. the amounts and other disclosure for the preceding year) presented above, is included as an integral part of the current year''s financial statements, and is to be read in relation to the amounts and other disclosures relating to the current year. Figures of the previous year are regrouped and reclassified wherever necessary to correspond to figures of the current year.


Mar 31, 2012

1.NOTES

Rights, preferences and restrictions attached to Equity shares

The company has a single class of equity shares. Each shareholder is eligible for one vote per share held (other than the shares represented by underlying GDRs which do not carry a voting right). The dividend proposed by the Board of Directors is subject to the approval of the shareholders. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the company after distribution of all preferential amounts, in proportion to their shareholding.

26,00,938 (previous year 30,85,814) equity shares represent the shares underlying outstanding Global Depository Receipts (GDRs). Each GDR represents 1 underlying equity share.

Rights, preferences and restrictions attached to Preference shares

The company has a single class of preference shares. They are redeemable at par in four equal quarterly installments commencing from 15 December 2017. The shares carry a right to receive 10% dividend every year till redempton. In the event of liquidation, the preference shareholders are eligible to receive the outstanding amount after distribution of all other preferential amounts, in proportion to their shareholding.

g Equity shares alloted as fully paid-up pursuant to contracts without payment being received in cash during the period of five years immediate preceding the date of the Balance Sheet are as under:

1,50,35,712 equity shares to the shareholders of the erstwhile Southern Iron and Steel Company Limited pursuant to a scheme of Amalgamation.

Details of Security

(i) The 11% NCDs aggregating to Rs. 1,000 crores are secured / to be secured by way of first pari passu charge on fixed assets related to 2.8 mtpa expansion project located at Upstream division and a fl at atVasind situated in the state of Maharashtra.

(ii) The 10.25% NCDs aggregating to Rs. 500 crores are secured by way of mortgage in respect of all immovable and movable properties both present and future located at Tarapur Works and Vasind Works in the State of Maharashtra.

(iii) The 10.60% NCDs aggregating to Rs. 350 crores are secured by:

- pari passu first charge by way of legal mortgage on land situated in the State of Gujarat.

- pari passu first charge by way of equitable mortgage on fixed assets of the new 5 mtpa Hot Strip Mill at Toranagallu village in the State of Karnataka.

(iv) The 10.10 % NCDs aggregating to Rs. 1,000 crores are secured by:

- pari passu first charge by way of legal mortgage on all immovable properties both present and future located at Tarapur Works and Vasind Works in the State of Maharashtra.

- pari passu first charge on all immovable properties and movable assets both present and future located at Salem Works in the State of Tamil Nadu.

(v) The 11.82% NCDs aggregating to Rs. 23.04 crores are secured by:

- First charge on land situated in the State of Gujarat.

- Second charge on Fixed Assets situated at Salem Works in the state of Tamilnadu.

(vi) The 11.82 % NCDs aggregating to Rs. 33.15 crores are secured by:

- pari passu first charge by way of legal mortgage on a flat situated at Mumbai, in the State of Maharashtra.

- pari passu first charge by way of equitable mortgage of the Companys immovable properties relating to the 100MW and 130MW Power Plants at Toranagallu village in the State of Karnataka.

(vii) Rupee Term Loans from Banks aggregating to Rs. 18.75 crores, Rupee Term Loan from financial Institution aggregating to Rs. 1.13 crores and Foreign Currency Term Loans from Banks aggregating to Rs. 51.16 crores are secured by:

- pari passu first charge by way of equitable mortgage in respect of immovable properties of Upstream Division situated at Vaddu, Kurekuppe and Toranagallu villages in the State of Karnataka and

- pari passu first charge by way of hypothecation of movable properties of Upstream Division both present and future excluding inventories and book debts.

(viii) Rupee Term Loans from Banks/Foreign Currency Term Loan from Bank are secured / to be secured as under :

- Rupee Term Loans aggregating to Rs. 13.42 crores and Foreign Currency Term Loans aggregating to Rs. 145.43 crores are secured by a first charge supported by an equitable/ registered Mortgage of movable and immovable properties and assets situated at Salem Works in the state of Tamilnadu and a second pari passu charge on the current assets at Salem Works.

- Rupee Term Loans aggregating to Rs. 176 crores and Foreign Currency Term Loans aggregating to Rs. 290.95 crores by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties of Cold Rolling Mill Complex at Toranagallu village in the State of Karnataka.

- Rupee Term Loans aggregating to Rs. 28.05 crores and Foreign Currency Term Loans aggregating to Rs. 258 crores by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties both present and future of 2.8 mtpa expansion project at Toranagallu village, in the State of Karnataka.

- Foreign Currency Term Loans aggregating to Rs. 805.71 crores by exclusive first charge by way of equitable mortgage in respect of all movable and immovable properties of Hot Strips Mill at Toranagallu village in the State of Karnataka.

- Rupee Term Loans aggregating to Rs. 4,573.12 crores by pari passu first charge by way of mortgage in respect of all movable and immovable properties both present and future, first charge/Assignment of all the assets and first charge on all the Bank Accounts of 3.2 mtpa expansion project at Toranagallu village in the State of Karnataka.

- Rupee Term Loan aggregating to Rs. 40 crores by exclusive first mortgage and charge on all movable and immovable properties both present and future, and first charge on the Bank Accounts of the 300 MW Power Plant - CPP IV at Toranagallu village in the State of Karnataka.

- Rupee Term Loan aggregating to Rs. 615 crores by first mortgage and charge of all immovable properties both present and future, and a first charge by way of hypothecation of all movable properties both present and future of the Beneficiation Plant (6 x 500 tph) and Pellet Plant (4.2 mtpa) at Toranagallu village in the State of Karnataka.

(ix) Rupee Term Loan from Financial Institution aggregating to Rs. 36.48 crores are secured by exclusive first charge by way of hypothecation of Bombardier Challenger 300 aircraft.

Terms of Repayment/ Redemption/ Conversion

1. Terms of Conversion/ Redemption of Bonds/ Non-Convertible Debentures ( NCDs )

(i) The FCCBs are convertible into Equity Shares at the option of the bondholders at any time on or after 7 August 2007 and prior to the close of business on 21 June, 2012 at Rs. 40.28 = 1 USD$.

(ii) The 11% Secured NCDs of Rs. 10 lacs each aggregating Rs. 1,000 crores are redeemable as under with call and put option excersiable on 16.03.17 and 16.03.19 :

- Rs. 330 crores each from 16.3.2021

- Rs. 330 crores each from 16.3.2022

- Rs. 340 crores each from 16.3.2023

(iii) The 10.25% Secured NCDs of Rs. 10 lacs each aggregating Rs. 500 crores are redeemable in 3 equal annual installments of Rs. 166.67 crores each from 17.02.2016 to 17.02.2018.

(iv) The 10.60% Secured NCDs of Rs. 10 lacs each aggregating Rs. 350 crores are redeemable in two tranches as under :

- 8 half yearly installments of Rs. 21.875 crores each from 02.01.2016 to 02.07.2019.

- 8 half yearly installments of Rs. 21.875 crores each from 02.08.2016 to 02.02.2020.

(v) The 10.10% Secured NCDs of Rs. 10 lacs each aggregating Rs. 1,000 crores are redeemable in two tranches as under :

- 16 quarterly installments of Rs. 31.25 crores each from 04.02.2014 to 04.11.2017.

- 16 quarterly installments of Rs. 31.25 crores each from 15.06.2014 to 15.03.2018.

(vi) The 11.82% Secured NCDs of Rs. 10 lacs each aggregating Rs. 23.04 crores are redeemable in 11 quarterly installments of Rs. 2.09 crores each from 01.07.2012 to 01.01.2015.

(vii) The 11.82% Secured NCDs of Rs. 10 lacs each aggregating Rs. 33.15 crores are redeemable in 17 quarterly installments of Rs. 1.95 crores each from 15.04.2012 to 15.04.2016.

2. Terms of Repayment of Secured Term Loans

(A) Rupee Term Loan from Banks of :

(i) Rs. 18.75 crores is repayable in 4 monthly installments of Rs. 4.69 crores each from 28.4.2012 to 28.7.2012.

(ii) Rs. 176 crores is repayable in 11 monthly installment of Rs.16 crores each from 1.5.2012 to 1.3.2013.

(iii) Rs. 28.04 crores is repayable in 4 quarterly installment of Rs. 0.83 crores each from 30.4.2012 to 31.1.2013 and of 12 quarterly installments of Rs. 2.06 crores each from 30.4.2013 to 31.1.2016.

(iv) Rs. 8.84 crores is repayable in 7 quarterly installment of Rs. 1.09 crores each from 30.6.2012 to 31.12.2013 and 1 quarterly installment of Rs. 1.17 crores on 31.3.2014.

(v) Rs. 4.58 crores is repayable in 7 quarterly installments of Rs. 0.57 crores each from 30.6.2012 to 31.12.2013 and 1 quarterly installment of Rs. 0.59 crores on 31.3.2014.

(vi) Rs. 2,935.74 crores is repayable as under :

- 4 quarterly installments of Rs.18.82 crores from

30.6.2012 - 31.3.2013.

- 8 quarterly installments of Rs.75.28 crores from

30.6.2013 - 31.3.2015.

- 8 quarterly installments of Rs.188.19 crores from 30.6.2015 - 31.3.2017.

- 2 quarterly installments of Rs.250.91 crores from 30.6.2017 - 30.9.2017.

- 1 quarterly installments of Rs.250.94 crores on 31.12.2017.

(vii) Rs. 1,250 crores is repayable as under :

- 2 quarterly installments of Rs. 15.63 crores each from 31.12.2012 - 31.3.2013.

- 4 quarterly installments of Rs. 7.81 crores each from 30.6.2013 - 31.3.2014.

- 8 quarterly installments of Rs. 31.25 crores each from 30.6.2014 - 31.3.2016.

- 12 quarterly installments of Rs. 78.13 crores each from 30.6.2016 - 31.3.2019.

(viii) Rs. 387.38 crores is repayable as under :

- 3 quarterly installments of Rs. 2.5 crores each from 1.7.2012 - 1.1.2013.

- 8 quarterly installments of Rs. 10 crores each from 1.4.2013 - 1.1.2015.

- 8 quarterly installments of Rs. 25 crores each from 1.4.2015 - 1.1.2017.

- 3 quarterly installments of Rs.33.32 crores each from 1.4.2017 - 1.10.2017.

(ix) Rs. 615 crores is repayable in 19 quarterly installments of Rs. 32.14 crores each from 1.1.2013 to 1.7.2017 and 1 quarterly installment of Rs. 4.29 crores on 1.10.2017.

(x) Rs. 40 crores is repayable in 1 quarterly installment of Rs. 27.5 crores each on 1.10.2012 and 1 quarterly installment of Rs. 12.5 crores on 1.1.2013.

(C) Rupee Term Loan from Financial Institutions of :

(i) Rs. 1.13 crores is repayable in 5 monthly installments of Rs. 0.22 crores each from 28.4.2012 to 28.8.2012.

(ii) Rs. 14.86 crores is repayable in 39 monthly installments of Rs. 0.38 crores each from 11.4.2012 to 11.6.2015.

(iii) Rs. 7.34 crores is repayable in 39 monthly installments of Rs. 0.19 crores each from 20.4.2012 to 20.6.2015.

(iv) Rs. 7.60 crores is repayable in 39 monthly installments of Rs. 0.195 crores each from 2.5.2012 to 02.7.2015.

(v) Rs. 6.68 crores is repayable in 39 monthly installments of Rs. 0.17 crores each from 15.4.2012 to 15.7.2015.

3 Terms of Repayment of Unsecured Term Loans

(A) Rupee Term Loan from Banks of Rs.900 crores is repayable in 6 monthly installments of Rs. 150 crores each from 1.8.2012 to 1.1.2013.

(B) Foreign Currency Term Loan from Banks of :

(i) Rs. 1,432.38 crores is repayable in 5 half yearly installments of Rs. 286.48 crores each from 28.8.2015 to 27.8.2017.

(ii) Rs. 808.37 crores is repayable in 19 half yearly installments of Rs. 42.55 crores each from 30.5.2012 to 31.3.2021.

(iii) Rs. 81.67 crores is repayable in 20 half yearly installments of Rs. 4.08 crores each reckoned 6 months from the date of last drawdown.

(iv) Rs. 51.16 crores is repayable on 28.6.2012.

(v) Rs. 51.16 crores is repayable on 30.9.2012.

4 Long Term Advance from a Customer of Rs. 356.39 crores is repayable as under :

- 6 monthly installments of Rs.18.17 crores each from

30.4.2012 to 30.9.2012.

- 6 monthly installments of Rs.19.82 crores each from 31.10.2012 to 31.3.2013.

- 5 monthly installments of Rs.21.47 crores each from

30.4.2013 to 31.8.2013.

- 1 monthly installment of Rs.21.14 crores on 1.9.2013.

5 Deferred Sales tax of Rs. 111.65 crores is repayable in 101 varying monthly installments starting from 30.4.2013 to 31.8.2021.

(Repayments stated above are rounded off to the nearest crore)

Working capital loans of Rs. 162.89 crores and Foreign currency loan of Rs. 153.46 crores are secured by :

- pari passu first charge by way of hypothecation of Stocks of Raw Materials, Finished Goods, Work-in-Process, Consumable Stores and Spares and Book Debts / Receivables of the Company, both present and future.

- pari passu second charge on movable properties and immovable properties forming part of the Fixed/Blocked assets of the company, both present and future except such properties as may be specifically excluded.

2. Contingent Liabilities not provided for in respect of

a) Bills Discounted Rs. 3,117.13 crores (Previous year Rs. 2,621.86 crores).

b) Guarantees provided to banks on behalf of subsidiaries Rs. 1,096.27 crores (Previous year Rs. 1,620.51 crores).

c) Disputed claims/levies (excluding interest, if any), in respect of:

(i) Excise Duty Rs. 200.27 crores (Previous year Rs. 179.70 crores);

(ii) Custom Duty Rs. 477.44 crores (Previous year Rs. 242.87 crores);

(iii) Income Tax Rs. 1.47 crores (Previous year Rs. 12.47 crores);

(iv) Sales Tax / Special Entry tax Rs. 170.30 crores (Previous year Rs. 72.36 crores);

(v) Service Tax Rs. 70.08 crores (Previous year Rs. 45.18 crores);

(vi) Miscellaneous Rs. 0.05 crores (Previous year Rs. 0.05 crores);

(vii) Levies by local authorities Rs. 3.04 crores (Previous year Rs. 3.04 crores); and

(viii) Claims by suppliers and other parties (including for Forest Development Tax) Rs. 509 crores (Previous year Rs. 207.41 crores).

3. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 3,729.12 crores (Previous year Rs. 3,865.45 crores).

4. Other Commitments :

(a) The Company has issued an undertaking to associate bankers for non disposal of its investment of Rs. 2,357.11 crores (Previous year Rs. Nil) in an associate till that entity repays its debts.

(b) The Company from time to time provides need based support to subsidiaries and a joint venture entity towards capital and other requirements.

(c) The Company has imported capital goods under the Export Promotion Capital Goods Scheme to utilise the benefit of a zero or concessional customs duty rate. These benefits are subject to future exports. Such export obligations at year end aggregate to Rs. 16,912.59 crores (Previous year Rs. 17,853.27 crores) by the company within the stipulated period.

5. In respect of the Companys long term, strategic investment in one of its subsidiaries, JSW Steel (USA) Inc., the Company has reviewed and assessed its business plans and expected future cash flows. The company has also considered an independent valuation of a significant portion of the underlying tangible assets. Whilst the subsidiary may have a longer gestation period than originally envisaged, the Company has concluded that the decline is temporary and no provision against the carrying amounts of the investment and loans of Rs. 1,948.41 crores is presently necessary.

In view of estimation uncertainties, assumptions will be monitored on a periodic basis by management and adjustments will be made in the event of an other than temporary adverse effect on the recoverable amounts of the assets.

6. Due to the unusual depreciation in the value of the rupee against US dollar, the net foreign exchange loss for the year has been considered by the Company as exceptional in nature.

7. Employee Share based Payment Plans:

b) Expenses arising from employees share- based payment plans- Rs.10.68 crores (Previous year Rs. 8.12 crores).

8. Derivatives:

a) The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The use of foreign currency forward contracts is governed by the Companys strategy approved by the Board of Directors, which provide principles on the use of such forward contracts consistent with the Companys Risk Management Policy. The Forward Exchange Contracts entered into by the Company and outstanding are as under:

b) The Company also uses derivative contracts other than forward contracts to hedge the interest rate and currency risk on capital account. Such transactions are governed by the strategy approved by the Board of Directors, which provide principles on the use of these instruments, consistent with the Companys Risk Management Policy. The Company does not use these contracts for speculative purposes.

9. Research and Development Activities:

Disclosure as required under Section 35(2AB) of the Income Tax Act, 1961.

b) The manufacturing and other expenses and depreciation include Rs. 9.28 crores (previous year Rs. 3.85 crores) and Rs. 3.52 crores (previous year Rs. 1.38 crores), respectively, in respect of Research and Development activities undertaken during the year.

10. Employee Benefits:

a) Defined Contribution Plan:

Companys contribution to Provident Fund Rs. 24 crores. (Previous Year Rs. 17.05 crores)

The Company expects to contribute Rs. 23.66 crores (previous year Rs. 12.22 crores) to its Gratuity Plan for the next year.

In assessing the Companys Post Retirement Liabilities, the Company monitors mortality assumptions and uses up-to-date mortality tables, the base being the LIC 1994-96 ultimate tables.

Expected return on plan assets is based on expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligations.

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

(ii) Provident Fund:

The company makes monthly contributions to Provident Fund managed by Trust for qualifying employees. Under the scheme, the company is required to contribute a specified percentage of the payroll costs to fund the benefits.

In keeping with the Guidance on Implementing Accounting Standard (AS) 15 (Revised) on Employee Benefits notified by the Companies (Accounting Standards) Rules, 2006, employer established provident fund trusts are treated as Defined Benefit Plans, since the Company is obliged to meet interest shortfall, if any, with respect to covered employees. According to the actuarial Valuation, the Defined Benefit Obligation of Interest rate Guarantee on exempted Provident Fund in respect of employees of the company as at 31st March, 2012 works out to Rs. Nil and hence no provision is required to be provided for in the books of accounts towards the guarantee given for notified interest rates.

11. Segment Reporting:

The Company is primarily engaged in the business of manufacture and sale of Iron and Steel Products. The Company has identified two primary business segments, namely Steel and Power (used mainly for captive consumption), which in the context of Accounting Standard 17 on "Segment Reporting" constitute reportable segments.

Notes :

1. Inter Segment transfer from the power segment is measured at the rate at which power is purchased / sold from / to the respective Electricity Board.

2. Inter Segment transfer from the steel segment is measured on the basis of fuel cost.

12. Related Parties disclosure as per Accounting Standard (AS)-18: A List of Related Parties

Parties with whom the Company has entered into transactions during the period where control exists :

1 Subsidiaries

JSW Steel (Netherlands) B.V.

JSW Steel (UK) Limited

Argent Independent Steel (Holdings) Limited

JSW Steel Service Centre (UK) Limited

JSW Steel Holding (USA) Inc.

JSW Steel (USA) Inc.

Periama Holdings, LLC

Purest Energy, LLC

Meadow Creek Minerals, LLC

Hutchinson Minerals, LLC

R.C. Minerals, LLC

Keenan Minerals, LLC

Peace Leasing, LLC

Prime Coal, LLC

Planck Holdings, LLC

Rolling S Augering, LLC

Periama Handling, LLC

Lower Hutchinson Minerals, LLC

Caretta Minerals, LLC

JSW Panama Holdings Corporation

Inversiones Euroush Limitada

Santa Fe Mining

Santa Fe Puerto S.A.

JSW Natural Resources Limited

JSW Natural Resources Mozambique Limitada

JSW ADMS Carvo Lda

JSW Steel Processing Centres Limited

JSW Bengal Steel Limited

JSW Natural Resources India Limited

Barbil Beneficiation Company Limited

JSW Jharkhand Steel Limited

JSW Building Systems Limited

JSW Steel East Africa Limited (w.e.f 13.09.2011)

Amba River Coke Limited (w.e.f 4.10.2011)

JSW Energy (Bengal) Limited (w.e.f 5.03.2012)

2 Associates

Jindal Praxair Oxygen Company Private Limited

JSW Ispat Steel Limited

JSW Energy (Bengal) Limited (upto 4.03.2012)

3 Joint Ventures

Vijayanagar Minerals Private Limited

Rohne Coal Company Private Limited

JSW Severfield Structures limited

Gourangdih Coal Limited

Toshiba JSW Turbine and Generator Private Limited

MJSJ Coal Limited

GEO Steel LLC

JSW Structural Metal Decking Limited

JSW MI Steel Service Center Private Limited (w.e.f 19.09.2011)

4 Key Management Personnel (KMP)

Mr. Sajjan Jindal Mr. Seshagiri Rao M V S Dr. Vinod Nowal Mr. Jayant Acharya

5 Relative of Key Managerial Personnel

Mrs. Savitri Devi Jindal

6 Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influence.

JSW Energy Limited

JSL Limited

JSW Realty & Infrastructure Private Limited

Jindal Saw Limited

Jindal Steel & Power Limited

Jindal South West Holdings Limited

JSOFT Solutions Limited

Jindal Industries Limited

JSW Cement Limited

JSW Jaigarh Port Limited

JSW Investments Private Limited

Reynold Traders Private Limited

Raj West Power Limited

JSW Power Trading Company Limited

JSW Aluminium Limited

O P Jindal Foundation

JSW Infrastructure Limited

South West Port Limited

JSW Techno Projects Management Limited

South West Mining Limited

JSL Architecture Limited

JSW Projects Limited

Sapphire Technologies Limited

13. Operating Lease

a) As Lessor:

i. The Company has entered into lease arrangements, for renting :

- 2,279 houses (admeasuring approximately 1,410,997 square feet) at the rate of Rs. 100/- per house per annum, for a period of 180 months.

- 648 houses (admeasuring approximately 326,703 square feet) at the rate of Rs. 24/- per square feet per annum, for a period of 36 to 60 months.

- 1 house at the rate of Rs. 1.2 lacs per annum, for a period of 11 months.

- 9 houses (admeasuring approximately 9,027 square feet) at the rate of Rs. 40/- per square feet per month per house, for a period of 60 months.

- 6 houses (approximately 5,529 square feet) at the rate of Rs. 125 per square feet for a period of 12 months.

- Office premises (part) admeasuring approximately 4,760 square feet at the rate of Rs. 110 per square feet for a period of 11 months.

- Office premises (part) admeasuring approximately 15,392 square feet at the rate of Rs. 175 per square feet for a period of 11 months.

The agreements are renewable at the option of the lessee after the end of the lease term.

ii. Disclosure in respect of assets (building) given on operating lease :

The agreements are executed for a period of 11 to 60 months with a renewable clause and also provide for termination at will by either party giving a prior notice period of 1 to 3 months.

12. The Company has the following Joint venture interest in India as at 31st March 2012:

Interest as Venturer

Vijayanagar Minerals Private Limited: Percentage of holding –

40% (Previous year 40 %)

Rohne Coal Company Private Limited: Percentage of holding –

49% (Previous year 49 %)

JSW Severfield Structures Limited : Percentage of holding –

50 % (Previous Year 50%)

Gourangdih Coal Limited : Percentage of holding – 50 %

(Previous Year 50 %)

JSW MI Steel Service Center Private Limited – 50% (Previous

Year Nil )

Interest as Investor

MJSJ Coal Limited: Percentage of holding – 11% (Previous year 11 %)

Toshiba JSW Turbine and Generator Private Limited – 5%

(Previous year 5 %)

13. Interest includes Rs. 2.5 crores (previous year Rs. 3.25 crores) on account of shortfall in payment of Direct Taxes.

14. Comparative fi nancial information (i.e. the amounts and other disclosure for the preceding year) presented above, is included as an integral part of the current years fi nancial statements, and is to be read in relation to the amounts and other disclosures relating to the current year. Figures of the previous year are regrouped and reclassifi ed wherever necessary to correspond to fi gures of the current year.


Mar 31, 2010

1. Contingent Liabilities not provided for in respect of :

a) Bills Discounted Rs. 1,275.88 crores (Previous year Rs. 977.32 crores).

b) Guarantees provided on behalf of subsidiaries (including step down subsidiaries) and others Rs. 1,818.24 crores (Previous year Rs. 2,135.74 crores).

c) Disputed statutory claims/levies including those pending in courts (excluding interest leviable, if any), in respect of:

(i) Excise Duty Rs. 96.67 crores (Previous year Rs. 90.01 crores);

(ii) Customs Duty Rs. 108.07 crores (Previous year Rs. 223.85 crores);

(iii) Income Tax Rs. 12.47 crores (Previous year Rs. 36.28 crores);

(iv) Sales Tax/Special Entry tax Rs. 0.35 crores (Previous year Rs. 0.35 crores);

(v) Service Tax Rs. 24.46 crores (Previous year Rs.31.27 crores);

(vi) Miscellaneous Rs. 0.05 crores (Previous year Rs. 0.24 crores); and

(vii) Levies by local authorities Rs. 3.04 crores (Previous year Rs. 15.28 crores).

d) Claims by Suppliers and other third parties not acknowledged as debts Rs. 6.31 crores (Previous year Rs. 131.76 crores).

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 3,644.94 crores (Previous year Rs. 4,660.30 crores).

3. Unlike the previous year which saw an unprecedented depreciation of the rupee against major foreign currencies, the movement of the rupee during the year is much less volatile. Accordingly, exchange fluctuations for the year have not been considered as an Exceptional item.

b) Expenses arising from employees share- based payment plans - Rs. 4.03 crores (Previous year Rs. 4.65 crores).

4. Derivatives:

a) The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and highly probable forecast transactions. The use of foreign currency forward contracts is governed by the Companys strategy approved by the Board of Directors, which provide principles on the use of such forward contracts consistent with the Companys Risk Management Policy.

b) The Company also uses derivative contracts other than forward contracts to hedge the interest rate and currency risk on capital account. Such transactions are governed by the strategy approved by the Board of Directors, which provide principles on the use of these instruments, consistent with the Companys Risk Management Policy. The Company does not use these contracts for speculative purposes.

5. Employee Benefits:

a) Defined Contribution Plan:

Companys contribution to Provident Fund Rs. 12.89 crores. (Previous year Rs. 12.04 crores).

6. Segment Reporting:

The Company is primarily engaged in the business of manufacture and sale of Iron and Steel Products. The Company has identified two primary business segments, namely Steel and Power (used mainly for captive consumption), which in the context of Accounting Standard 17 on "Segment Reporting" constitute reportable segments.

7. Related parties disclosure as per Accounting Standard (AS) -18: A. List of Related Parties

Parties with whom the Company has entered into transactions during the year/where control exists :

1. Subsidiaries

JSW Steel (UK) Limited

JSW Steel Service Centre (UK) Limited

Argent Independent Steel (Holdings) Limited

JSW Natural Resources Limited

JSW Natural Resources Mozambique Limitada

JSW Steel (Netherlands) B.V.

JSW Steel Holding (USA) Inc

JSW Steel (USA) Inc

JSW Panama Holdings Corporation

Inversiones Eurosh Limitada

Santa Fe Mining

Santa Fe Puerto S.A.

JSW Steel Processing Centres Limited

JSW Jharkhand Steel Limited

JSW Bengal Steel Limited

Barbil Benefication Company Limited

JSW Building Systems Limited

2. Associates

Jindal Praxair Oxygen Company Private Limited

3. Joint Ventures

Vijayanagar Minerals Private Limited

Rohne Coal Company Private Limited

JSW Severfield Structures limited

Gourangdih Coal Limited

Toshiba JSW Turbine and Generator Private Limited

MJSJ Coal Limited

4. Key Management Personnel

Mrs. Savitri Devi Jindal

Mr. Sajjan Jindal

Mr. Seshagiri Rao M. V. S.

Dr. Vinod Nowal

Mr. Y. Siva Sagar Rao (Upto 15.05.2009)

Mr. Jayant Acharya (w.e.f. 7.05.2009)

5. Enterprises over which Key Management Personnel and Relatives of such personnel exercise significant influence.

JSW Energy Limited

JSL Limited

JSW Realty & Infrastructure Private Limited

Jindal Saw Limited

Jindal Steel & Power Limited

Jindal South West Holdings Limited

Jsoft Solutions Limited

Jindal Industries Limited

JSW Energy (Ratnagiri) Limited

JSW Cement Limited

JSW Jaigarh Port Limited

Nalwa Sons & Investments Limited

JSW Investments Private Limited

Reynold Traders Private Limited

Raj West Power Limited

JSW Power Trading Company Limited

JSW Aluminium Limited

O P Jindal Foundation

JSW Infrastructure & Logistic Limited

South West Port Limited

8. Operating Lease:

a) As Lessor:

i. The Company has entered into lease arrangements, for renting:

2,279 houses (admeasuring approximately 1,410,997 square feet) at the rate of Rs 100/- per house per annum, for a period of 180 months. 672 houses (admeasuring approximately 551,051 square feet) at the rate of Rs. 24/- per square feet per annum, for a period of 36 to 60 months. 1 house at the rate of Rs. 0.60 lacs per annum, for a period of 11 months.

9. The Company has the following Joint venture interest in India as at 31 March, 2010:

Interest as Venturer

Vijayanagar Minerals Private Limited: Percentage of holding - 40% (Previous year 40%)

Rohne Coal Company Private Limited: Percentage Of holding - 49% (Previous year 49%)

JSW Severfield Structures Limited: Percentage of holding - 50% (Previous Year Nil)

Gaurangdih Coal Limited: Percentage of holding - 50% (Previous Year Nil)

Interest as Investor

MJSJ Coal Limited: Percentage of holding -11% (Previous year 11%)

Toshiba JSW Turbine and Generator Private Limited - 5% (Previous year Nil)

10. Previous years figures have been regrouped, wherever necessary, to conform to current years presentation.

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