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Notes to Accounts of LIC Housing Finance Ltd.

Mar 31, 2016

1. a) Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) are Rs. 54.25 Lacs (Previous Year Rs. 554.40 Lacs).

b) Other Commitments: Uncalled liability of Rs. 663.50 Lacs (Previous Year Rs. 3,125.00 Lacs) in respect of commitment made for contribution to LICHFL Urban Development Fund by subscription of 50,000 units (Previous Year 50,000 units) of Rs. 10,000/- face value each, paid up value being Rs. 7,848.32 (Previous Year Rs. 3,750/-) each.

2. Contingent liabilities in respect of :

a) Claims against the Company not acknowledged as debts Rs. 130.19 Lacs (Previous Year Rs. 289.04 Lacs).

b) On completion of income tax assessment, the Company had received a demand of Rs. 347.76 Lacs- (including interest of Rs. 20.39 Lacs) for A.Y. 2003-04, Rs. 2,217.31 Lacs (including interest of Rs. 721.90 Lacs) for A.Y. 2004-05 against which the Company received refund of Rs. 220.38 Lacs, Rs. 3,571.94 Lacs (including interest of Rs. 667.94 Lacs) against which Rs. 1,951.62 Lacs was paid under protest for A.Y. 2005-06, Rs. 2,385.58 Lacs (including interest of Rs. 138.71 Lacs) against which the Company received refund of Rs. 137.47 Lacs for A.Y. 2006-07 and Rs. 1,503.40 Lacs (including interest of Rs. 633.94 Lacs ) for A.Y. 2007-08. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid to the credit of the Central Govt. under protest.

3. (i) Retail / Project Loans are secured by any or all of the following as applicable, based on their categorisation:

a) Equitable / Registered Mortgage of Property.

b) Assignment of Life Insurance Policies, NSC, KVP, FD of Nationalized Bank.

c) Assignment of Lease Rent Receivables.

d) Company guarantees or personal guarantees.

e) Negative lien.

f) Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

4. Housing Loans include loans amounting to Rs. 4,198.16 Lacs (Previous Year Rs. 3,643.06 Lacs) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The fair value of assets possessed against the loan is Rs.5,897.10 Lacs (Previous Year Rs. 3,427.77 Lacs), being lower of the fair value of the asset possessed and the outstanding due under the loans as at March 31, 2016.

5. Movement in Provision for contingencies and diminution in the value of investments are as under:

a) Provision includes:

i. Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of the securitized receivables, and

ii. Provision for doubtful advances and provision for probable loss on account of bank reconciliation differences.

6. Fixed Deposits with Banks includes earmarked deposits created in favor of trustees for depositors towards maintaining Statutory Liquid Ratio amounting to Rs. 8,190.20 Lacs (Previous Year Rs. 17,033.05 Lacs). The Company has beneficial interest on the income earned from these deposits.

7. Miscellaneous income includes Rs. 4.18 Lacs (Previous Year Rs. 3.39 Lacs) being interest income on staff loans/advances, Rs. 381.37 Lacs (Previous Year Rs. 392.06 Lacs) being gain on unwinding of Interest rate SWAP, Rs. 80.45 Lacs (Previous Year Rs. 98.95 Lacs) being old outstanding and unclaimed amounts written back, Nil (Previous Year Rs. 350.73 Lacs) being interest on income tax refund.

8. Temporary Book Overdraft of Rs. 385,305.58 Lacs (Previous Year Rs. 287,159.72 Lacs) represents cheques issued towards disbursements to borrowers for Rs. 383,975.90 Lacs (Previous Year Rs. 286,111.34 Lacs) and cheques issued for payment of expenses of Rs. 1,329.68 Lacs (Previous Year Rs. 1,048.38 Lacs), but not encashed as at March 31, 2016.

9. The Company had requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. The disclosure relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have been given to the extent such parties could be identified on the basis of the information available with the Company regarding the status of suppliers under MSMED Act, 2006. No interest has been paid/payable by the Company during the current year to the parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

10. Derivative Instruments:

(a) Interest Rate Swaps for hedging underlying liability aggregate to Rs. 119,600.00 Lacs (Previous Year Rs. 119,600.00 Lacs).

(b) For underlying liability of Rs. 65,000.00 Lacs (Previous Year Rs. 65,000.00 Lacs), Coupon Swap has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

(c) The Company as on March 31, 2016 had outstanding interest rate and coupon swaps covering the underlying liability aggregating to Rs. 184,600.00 Lacs (Previous Year Rs. 184,600.00 Lacs). The Mark to Market value of all such Swaps as at March 31, 2016 was negative to the extent of Rs. 3,345.39 Lacs (Previous Year Rs. 5,292.11 Lacs).

(d) Foreign currency exposure in respect of coupon linked with LIBOR that are not hedged by derivative instruments as on March 31, 2016 amount to Rs. 2.83 Lacs (Previous Year Rs. 1.16 Lacs).

11. Disclosure in respect of Employee Benefits:

In accordance with the Accounting Standard on (AS-15) – "Employee Benefits" the following disclosures have been made:

Provident Fund and Pension Fund Liability

The Company has recognized Rs. 860.99 Lacs (Previous Year Rs. 747.76 Lacs) in the Statement of Profit and Loss towards contribution to Provident fund in respect of company employees. In respect of LIC employees on deputation who have opted for pension, Rs. 92.55 Lacs (Previous Year Rs. 22.63 Lacs) have been contributed towards LIC of India (Employees) Pension Rules, 1995.

Sick Leave

The Company has recognized Rs. 161.00 Lacs (Previous Year Rs. 458.00 Lacs) in the Statement of Profit and Loss towards sick leave in respect of company employees.

12. Segment Reporting:

The Company is engaged in the business of providing loans for purchase, construction, repairs and renovation etc. of houses / fats to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. Accordingly, there are no separate reportable segments, as per the Accounting Standard on ''Segment Reporting'' (AS-17) notified under the relevant provisions of the Act.

13. Related Party Disclosure:

a) Names of related parties:

(i) Enterprise having significant influence

Life Insurance Corporation of India

(ii) Subsidiaries

LICHFL Care Homes Ltd.

LICHFL Financial Services Ltd.

LICHFL Asset Management Company Ltd. (Formerly known as LICHFL Asset Management Company Private Ltd.)

LICHFL Trustee Company Private Ltd.

(iii) Entity over which control exists

LICHFL Urban Development Fund

(iv) Associate

LIC Nomura Mutual Fund Asset Management Company Ltd. (Formerly Known as LIC Mutual Fund Asset Management Company Ltd.)

(v) Key Management Personnel

Ms. Sunita Sharma, MD and Chief Executive Officer

14. Operating Leases:

The Company has taken various offices and residential premises on cancellable operating lease basis for periods which range from 11 to 180 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Statement of Profit and Loss for such premises are Rs. 2,401.31 Lacs (Previous Year Rs. 2,153.54 Lacs).

15. Earnings per share:

Earnings per share is calculated by dividing the profit attributable to the equity shareholders by the weighted average number of equity shares outstanding during the year as under:

16. Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(viii), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

17. Corporate Social Responsibility

Establishment and Other expenses includes Rs. 1,423.82 Lacs for the year ended March 31, 2016 (Previous Year Rs. 400.00 Lacs) contribution towards Corporate Social Responsibility(CSR) in accordance with Companies Act, 2013.

Details of CSR spent during the financial year

a) Gross amount required to be spent by the company during the year is Rs. 3,540.00 Lacs

b) Amount spent during the year on:

c) Details of related party transactions as per Accounting Standard (AS-18), "Related Party Disclosures" - Nil

d) An amount of Rs. 343.76 Lacs had been provided for by the company suo-motu as on March 31, 2016 which relates to the projects sanctioned during FY 2015-16 and the disbursement would be done subject to the receipt of a satisfactory feld visit report.

18. In accordance with the Payment of Bonus (Amendment) Act, 2015, due to increase in the eligibility and ceiling limit, provision of Rs. 60.95 Lacs has been provided for the year ended March 31, 2016. Further provision of Rs. 4.07 Lacs has been provided in respect of FY 2014-15 as per the said amendment.

19. Disclosure regarding provisions made for substandard, doubtful and loss assets and depreciation in investments as per the Prudential Norms contained in the Housing Finance Companies (NHB) Directions, 2010 as amended.

20. Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010 during the current year:

a. The Company has not been imposed any penalty by National Housing Bank (NHB).

b. Observations of National Housing Bank (NHB) have been suitably addressed and compliance has been reported to NHB.

21. The additional Information pursuant to Schedule III to the Companies Act, 2013 are either Nil or Not Applicable.

22. The previous year figures have been reclassified / regrouped / restated to conform to current year''s classification.


Mar 31, 2015

1 Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 2/- per share. Each shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in Annual General Meeting. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amount, in proportion to their shareholdings.

2 The NCD are redeemable at par. The NCD are Secured by first pari passu floating charge by way of hypothecation of all current and future receivables, including book debts (to the extent of amounts payable to NCD holders) of the company, except to the extent of 5% of its receivables including book debts and as may be required under any law, regulations, guidelines or rules. In addition to above The NCD are secured by way of a pari passu mortgage and charge in favour of the Debenture trustees on the Company''s immovable property to the extent of Rs. 24.29 Lacs.

3 Zero Coupon Debentures (ZCD):

The ZCD are redeemable at Premium. The ZCD are Secured by first pari passu floating charge by way of hypothecation of all current and future receivables, including book debts (to the extent of amounts payable to the debenture holders) of the company, except to the extent of 5% of its receivables including book debts and as may be required under any law, regulations, guidelines or rules. In addition to above The NCD are secured by way of a pari passu mortgage and charge in favour of the Debenture trustees on the Company''s immovable property to the extent of Rs. 24.29 Lacs

4 a) Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) are Rs. 554.40 Lacs (Previous year Rs. 1,564.20 Lacs).

b) Other Commitments: Uncalled liability of Rs. 3125 Lacs (Previous Year Rs. 3565 Lacs) in respect of commitment made for contribution to LICHFL Urban development fund by subscription of 50000 units (previous year 50,000 units) of Rs. 10,000/- face value each, paid up value being Rs. 3750/-(previous year Rs. 2,870/-) each.

5 Contingent liabilities in respect of :

a) Claims against the Company not acknowledged as debts Rs. 289.04 Lacs (Previous Year Rs. 35.44Lacs).

b) On completion of income tax assessment, the Company had received a demand of Rs. 347.76 Lacs- (including interest of Rs. 20.39 Lacs) for A.Y 2003-04, Rs. 2,217.31 Lacs (including interest of Rs. 721.90 Lacs) for A.Y 2004-05 against which the Company received refund of Rs. 220.38 Lacs, Rs. 3,571.94 Lacs (including interest of Rs. 667.94 Lacs) against which Rs. 1,951.62 Lacs was paid under protest for A.Y. 2005-06, Rs. 2,385.58 Lacs (including interest of Rs. 138.71 Lacs against which the Company received refund of Rs. 137.47 for A.Y. 2006-07 and Rs. 1,503.40 Lacs (including interest of Rs. 633.94 Lacs) for A.Y. 2007-08. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid to the credit of the Central Govt. under protest.

6 (i) Retail / Project Loans are secured by any or all of the following as applicable, based on their categorisation :

a) Equitable / Registered Mortgage of Property.

b) Assignment of Life Insurance Policies, NSC, KVP, FD of Nationalized Bank.

c) Assignment of Lease Rent Receivables.

d) Company guarantees or personal guarantees.

e) Negative lien.

f) Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

7 Housing Loans include loans amounting to Rs. 3,643.06 Lacs (Previous year Rs. 2378.65 Lacs) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The fair value of assets possessed against the loan is Rs.3427.77 Lacs (Previous year Rs. 2,362.53 Lacs), being lower of the fair value of the asset possessed and the outstanding due under the loans as at March 31, 2015.

8 Movement in Provision for contingencies and diminution in the value of investments are as under:

a) Provision includes:

i. Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of the securitized receivables, and

ii. Provision for doubtful advances and provision for probable loss on account of bank reconciliation differences.

8 Fixed Deposits with Banks includes earmarked deposits created in favour of trustees for depositors towards maintaining Statutory Liquid ratio amounting to Rs. 17033.05 Lacs (Previous Year Rs. 8650.30 Lacs). The Company has beneficial interest on the income earned from these deposits.

9 Miscellaneous income includes Rs. 3.39 Lacs (Previous Year Rs. 3.91 Lacs) being interest income on staff loans/advances, Rs. 392.06 Lacs (Previous Year Rs. 401.75 Lacs) being gain on unwinding of Interest rate SWAP, Rs. 98.95 Lacs (Previous Year Rs. 138.83 Lacs) being old outstanding and unclaimed amounts written back, Rs. 350.73 Lacs (Previous year 1947.09) being interest on income tax refund.

10 Temporary Book Overdraft of Rs. 287,159.72 Lacs (Previous Year Rs. 207,104.08 Lacs) represents cheques issued towards disbursements to borrowers for Rs. 286111.34 Lacs (Previous Year Rs. 206,213.92 Lacs) and cheques issued for payment of expenses of Rs. 1048.38 Lacs (Previous Year Rs. 890.16 Lacs), but not encashed as at March 31, 2015.

11 The Company had requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. The disclosure relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have been given to the extent such parties could be identified on the basis of the information available with the company regarding the status of suppliers under MSMED Act, 2006. No interest has been paid/payable by the Company during the current year to the parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

12 Derivative Instruments:

(a) Interest Rate Swaps for hedging underlying liability aggregate to Rs. 119,600.00 Lacs (Previous year Rs. 119,600.00 Lacs).

(b) For underlying liability of Rs. 65,000.00 Lacs (Previous Year Rs. 65,000.00 Lacs), Coupon Swap has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

(c) The Company as on March 31, 2015 had outstanding interest rate and coupon swaps covering the underlying liability aggregating to Rs. 184,600.00 Lacs (Previous year Rs. 184,600.00 Lacs). The Mark to Market value of all such Swaps as at March 31,2015 was negative to the extent of Rs. 5,292.11 Lacs (Previous Year Rs. 14503.79 Lacs).

(d) Foreign currency exposure in respect of coupon linked with LIBOR that are not hedged by derivative instruments as on March 31,2015 amount to Rs. 1.16 lacs.

13 Disclosure in respect of Employee Benefits:

In accordance with the Accounting Standard on (AS-15) - "Employee Benefits" the following disclosure have been made:

Provident Fund and Pension Fund Liability

The Company has recognised Rs. 747.76 lacs (Previous year Rs. 649.37 lacs) in the Statement of Profit and Loss towards contribution to Provident fund in respect of company employees. In respect of LIC employees on deputation who have opted for pension, Rs. 22.63 lacs (previous year Rs. 23.31 lacs) have been contributed towards LIC of India (Employees) Pension Rules, 1995.

14 Segment Reporting:

The Company is engaged in the business of providing loans for purchase, construction, repairs and renovation etc. of houses to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. Accordingly, there are no separate reportable segments, as per the Accounting Standard on ''Segment Reporting'' (AS 17) notified underthe relevant provisions ofthe Act.

15 Operating Leases:

The Company has taken various offices and residential premises on cancelable operating lease basis for periods which range from 11 to 120 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Statement of Profit and Lossfor such premises are Rs. 2,153.54 Lacs (Previous year Rs. 1,854.29 Lacs).

16 Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(viii), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

17 Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010. During the current year, the Company has:

a. neither been imposed any penalty by National Housing Bank

b. nor received any adverse comments in writing from National Housing Bank on regulatory compliances.

18 The additional Information pursuant to Schedule III to the Companies Act, 2013 are either Nil or Not Applicable.

19 The previous year figures have been reclassified / regrouped / restated to conform to current year''s classification.


Mar 31, 2014

1. a) Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances)

are Rs. 1,564.20 Lacs (Previous year Rs. 363.64 Lacs).

b) Other Commitments: Uncalled liability of Rs. 3,565 Lacs (Previous Year Rs. 4,000 Lacs) in respect of commitment made for contribution to LICHFL Urban development fund by subscription of 50,000 units (previous year 50,000 units) of Rs. 10,000/- face value each, paid up value being Rs. 2,870/-(previous year Rs. 2,000/-) each.

2. Contingent liabilities in respect of :

a) Corporate Undertaking Nil (Previous year Rs. 1,435.00 Lacs) for Securitization transactions.

b) Claims against the Company not acknowledged as debts Rs. 35.44 Lacs (Previous Year Rs. 23.38 Lacs).

c) The Company has received a demand of Rs. 1,145.56 Lacs, Rs. 1,122.06 Lacs (including interest of Rs. 88.99 Lacs), Rs. 347.76 Lacs (including interest of Rs. 20.39 Lacs), Rs. 2,217.31 Lacs (including interest of Rs. 721.90 Lacs), Rs. 3,571.94 Lacs (including interest of Rs. 667.94 Lacs), Rs. 2,385.58 Lacs (including interest of Rs. 138.71 Lacs) and Rs. 1,503.40 Lacs (including interest of Rs. 633.94 Lacs) on completion of income tax assessment for the assessment year 2001-02, 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 respectively. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid to the credit of the Central Govt. under protest.

3. (i) Retail / Project Loans are secured by any or all of the following as applicable, based on their categorisation :

a) Equitable / Registered Mortgage of Property.

b) Assignment of Life Insurance Policies, NSC, KVP, FD of Nationalized Bank.

c) Assignment of Lease Rent Receivables.

d) Company guarantees or personal guarantees.

e) Negative lien.

f) Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

4. Housing Loans include loans amounting to Rs. 2,378.65 Lacs (Previous year Rs. 1,757.68 Lacs) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The fair value of assets possessed against the loan is Rs. 3,819.28 Lacs (Previous year Rs. 2,727.79 Lacs), being lower of the fair value of the asset possessed and the outstanding due under the loans as at March 31, 2014.

5. Provision for contingencies includes:

a) Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of the securitized receivables.

b) Provision for probable loss on account of bank reconciliation differences.

6. Fixed Deposits with Banks include Rs. 8,650.30 Lacs (Previous Year Rs. 5,650.30 Lacs) kept with designated banks for repay- ment to Public Deposit Holders. The Company has beneficial interest on the income earned from these deposits.

7. Miscellaneous income includes nil (Previous Year Rs. 15.97 Lacs) being management fee from Kotak India Real Estate Venture Fund, Rs. 3.91 Lacs (Previous Year Rs. 3.68 Lacs) being interest income on staff loans/advances, Rs. 401.75 Lacs (Previous Year Rs. 432.11 Lacs) being gain on unwinding of Interest rate SWAP, Rs. 138.83 Lacs (Previous Year Rs. 129.32 Lacs) being old outstanding and unclaimed amounts written back, Rs. 1,947.09 Lacs (Previous year Nil) being interest on income tax refund.

8. Temporary Book Overdraft of Rs. 207,104.08 Lacs (Previous Year Rs. 188,681.35 Lacs) represents cheques issued towards disbursements to borrowers for Rs. 206,213.92 Lacs (Previous Year Rs. 187,799.45 Lacs) and cheques issued for payment of expenses of Rs. 890.16 Lacs (Previous Year Rs. 881.90 Lacs), but not encashed as at March 31, 2014.

9. The Company had requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. The disclosure relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have been given to the extent such parties could be identified on the basis of the information available with the company regarding the status of suppliers under MSMED Act, 2006. No interest has been paid/payable by the Company during the current year to the parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

10. Derivative Instruments:

(a) Interest Rate Swaps for hedging underlying liability aggregate to Rs. 119,600.00 Lacs (Previous year Rs. 119,600.00 Lacs).

(b) For underlying liability of Rs. 65,000.00 Lacs (Previous Year Rs. 65,000.00 Lacs), Coupon Swap has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

(c) The Company as on March 31, 2014 had outstanding interest rate and coupon swaps covering the underlying liability aggregating to Rs. 184,600.00 Lacs (Previous year Rs. 184,600.00 Lacs). The Mark to Market value of all such Swaps as at March 31, 2014 was negative to the extent of Rs. 14,503.79 Lacs (Previous Year Rs. 13,160.70 Lacs).

11. Disclosure in respect of Employee Benefits:

In accordance with the Accounting Standard on Employee Benefits (AS-15) (Revised 2005) notified by Companies (Accounting Standards) Rules , 2006 , the following disclosure have been made :

Provident Fund and Pension Fund Liability

The Company has recognised Rs. 649.37 lacs (Previous year Rs. 533.75 lacs) in the Statement of Profit and Loss towards contribution to Provident fund in respect of company employees. In respect of LIC employees on deputation who have opted for pension, Rs. 23.31 lacs (Previous year Rs. 21.94 lacs) have been contributed towards LIC of India (Employees) Pension Rules, 1995.

12. Segment Reporting:

The Company is engaged in the business of providing loans for purchase, construction, repairs and renovation etc. of houses to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. Accordingly, there are no separate reportable segments, as per the Accounting Standard on ''Segment Reporting'' (AS 17) issued by the Institute of Chartered Accountants of India / notified under the Companies (Accounting Standards) Rules, 2006.

13. Related Party Disclosure:

a) Names of related parties where control exists:

Name of the related party

(i) Subsidiaries

LICHFL Care Homes Ltd.

LICHFL Financial Services Ltd.

LICHFL Asset Management Company Ltd. (Formerly known as LICHFL Asset Management Company Private Ltd.)

LICHFL Trustee Company Private Ltd.

(ii) Entities over which control is exercised

LICHFL Urban Development Fund

b) Details of other related parties with whom transactions have taken place:

Name of the related party

(i) Enterprise having significant influence

Life Insurance Corporation of India

(ii) Associate

LIC Nomura Mutual Fund Asset Management Company Limited (Formerly Known as LIC Mutual Fund Asset Management Company Ltd.)

(iii) Key Management Personnel

Ms. Sunita Sharma , Managing Director and Chief Executive Officer (since November 2013) Mr. V.K. Sharma, Managing Director and Chief Executive Officer (upto October 2013)

14. Operating Leases:

The Company has taken various offices and residential premises on cancelable operating lease basis for periods which range from 11 to 120 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Statement of Profit and Loss for such premises are Rs. 1,854.29 Lacs (Previous year Rs. 1,717.49 Lacs).

15. Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(viii), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

16. Disclosure regarding provisions made for substandard, doubtful and loss assets and depreciation in investments as per the Prudential Norms contained in the Housing Finance Companies (NHB) Directions, 2010 as amended.

17. Disclosure as per Clause 32 of the Listing Agreement :

Figures in bracket are in respect of the previous year.

a. Since the above loan is repayable on demand, there is no repayment schedule for the loan.

b. No interest is charged on the above loan. However, the provisions of section 372A of the Companies Act, 1956 are not applicable to above loan in view of the loan being given to the subsidiary of the company.

c. Loans and Advances to employees / customers and investments by such employees / customers in the shares of the Company, if any, are excluded from the above disclosure.

18. Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010. During the current year, the Company has:

a. neither been imposed any penalty by National Housing Bank

b. nor received any adverse comments in writing from National Housing Bank on regulatory compliances.

19. The additional Information pursuant to revised Schedule VI to the Companies Act, 1956 are either Nil or Not Applicable.

20. The previous year figures have been reclassified / regrouped / restated to conform to current year''s classification.


Mar 31, 2013

1. a) Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) are Rs. 363.64 Lacs (Previous year Rs. 151.31 Lacs).

b) Other Commitments: Uncalled liability of Rs. 4,000 Lacs in respect of commitment made for contribution to LICHFL Urban development fund by subscription of 40,000 units (previous year nil) of Rs. 10,000.00 each.

2. Contingent liabilities in respect of:

a) Corporate Undertaking of Rs. 1,435.00 Lacs (Previous year Rs. 1,435.00 Lacs) for Securitization transactions.

b) Claims against the Company not acknowledged as debts Rs. 23.38 Lacs (Previous Year Rs. 5.93 Lacs).

c) The Company has received a demand of Rs. 1,145.56 Lacs, Rs. 1,122.06 Lacs (including interest of Rs. 88.99Lacs), Rs. 347.76 Lacs (including interest of Rs. 20.39 Lacs), Rs. 2,217.31 Lacs (including interest of Rs. 721.90 Lacs), Rs. 3,571.94 Lacs (including interest of Rs. 667.94 Lacs), Rs. 2,385.58 Lacs (including interest of Rs. 138.71 Lacs) and Rs. 1,503.40 Lacs (including interest of Rs. 633.94 Lacs) on completion of income tax assessment for the assessment year 2001-02, 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 respectively. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid to the credit of the Central Govt, under protest.

3. (i) Retail / Project Loans are secured by any or all of the following as applicable, based on their categorisation :

a) Equitable / Registered Mortgage of Property.

b) Assignment of Life Insurance Policies, NSC, KVR FD of Nationalized Bank.

c) Assignment of Lease Rent Receivables.

d) Company guarantees or personal guarantees.

e) Negative lien.

f) Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

4. Housing Loans include loans amounting to Rs. 1,757.68 Lacs (Previous year Rs. 2,246.22 Lacs) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. The fair value of assets possessed against the loan is Rs. 2,727.79 Lacs (Previous year Rs. 2,080.89 Lacs), being lower of the fair value of the asset possessed and the outstanding due under the loans as at March 31, 2013.

5. Provision for contingencies includes:

a) Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of,the securitized receivables.

b) Provision for probable loss on account of bank reconciliation differences.

6. During the previous year, pursuant to the shareholder''s approval in the Extraordinary General;#l6eting held on March 5, 2012 the Company had allotted 3,00,00,000 equity shares of face value of Rs. 2/- each at a premium of Rs. 268/- per share aggregating to Rs. 81,000.00 Lacs to Life Insurance Corporation of India, promoter of the Corrtpany''on a Preferential basis under lock-in period of three years, The said issue was made under chapter VIII of the Securittes aYid Exchange Board of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 as amended.

7. Fixed Deposits with Banks include Rs. 5,650.30 Lacs (Previous Year Rs. 4,296.24 Lacs) kept With designated banks for repayment to Public Deposit Holders. The Company has beneficial interest on the income earned* from these deposits.

8. Miscellaneous income includes Rs. 15.97 Lacs (Previous Year Rs. 30.57 Lacs) being management fee from Kotak India Real Estate Venture Fund, 7 3.68 Lacs (Previous Year Rs. 3.04 Lacs) being interest income on staff loans/advances, Rs. 432.11 Lacs (Previous Year Rs. 537.77 Lacs) being gain on unwinding of Interest rate SWAR Rs. 129.32 Lacs (Previous Year Rs. 93.80 Lacs) being old outstanding and unclaimed amounts written back.

9. The Company had requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. The disclosure relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have been given to the extent such parties could be identified on the basis of the information available with the company regarding the status of suppliers under MSMED Act, 2006. No interest has been paid/payable by the Company during the current year to the parties covered under the Micro, Small and Medium Enterprises Development Act, 2006.

10. Derivative Instruments:

a) Interest Rate SWAP for hedging underlying liability aggregate to Rs. 1,19,600.00 Lacs (Previous year Rs. 1,34,600.00 Lacs).

b) For underlying liability of Rs. 65,000.00 Lacs (Previous year Rs. 65,000.00 Lacs), Coupon SWAP has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

c) The Company as on March 31, 2013 had outstanding interest rate and coupon SWAPs covering the underlying liability aggregating to Rs. 1,84,600.00 Lacs (Previous year Rs. 1,99,600.00 Lacs). The mark to market value of all such SWAPs as at March 31, 2013 was negative to the extent of Rs. 13,160.70 Lacs (Previous year Rs. 24,130.27 Lacs).

11. Disclosure In respect of Employee Benefits:

In accordance with the Accounting Standard on Employee Benefits (AS-15) (Revised 2005) notified by Companies (Accounting Standards) Rules, 2006, the following disclosure have been made :

Provident Fund and Pension Fund Liability

The Company has recognised Rs. 533.75 Lacs (Previous year X 434.30 Lacs) in the Statement of Profit and Loss towards contribution to Provident fund in respect of company employees. In respect of LIC employee on deputation who have opted for pension, Rs. 21.94 Lacs (previous year Rs. 22.39 Lacs) have been contributed towards LIC of India (Employees) Pension Rules, 1995.

12. Segment Reporting:

The Company is engaged in the business of providing loRs.tns for purchase, construction, repairs and renovation, etc. of houses to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. Accordingly, there are no separate reportable segments, as per the Accounting Standard on ''Segment Reporting1 (AS 17) issued by the Institute of Chartered Accountants of India / notified under the Companies (Accounting Standards) Amendment Rules, 2011.

13. Operating Leases:

The Company has taken various offices and residential premises on cancelable operating lease basis for periods which range from 11 to 120 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Statement of Profit and-koss for such premises are Rs. 1,717.49 Lacs (Previous year Rs. 1,431.76 Lacs).

14. Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(vitl), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

15. Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010. During the current year, the Company has:

a. neither been imposed any penalty by National Housing Bank

b. nor received any adverse comments in writing from National Housing Bank on regulatory compliances.

16. The additional Information pursuant to revised Schedule VI to the Companies Act, 1956 are either Nil or Not Applicable.

17. The previous year figures have been reclassified / regrouped / restated to conform to current year''s classification.


Mar 31, 2012

1. Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) are Rs 151.31 Lacs (Previous year Rs 150.00 Lacs).

2. Contingent liabilities in respect of :

a) Corporate Undertaking of Rs 1,435.00 Lacs (Previous year Rs 1,435.00 Lacs) for Securitization transactions.

b) Claims against the Company not acknowledged as debts Rs 5.93 Lacs (Previous YearRs 8.38 Lacs).

c) The Company has received a demand of Rs 1,145.56 Lacs, Rs 1,122.06Lacs (including interest of Rs 88.99Lacs), Rs 347.76Lacs (including interest of Rs 20.39 Lacs), Rs 2,217.31 Lacs (including interest of Rs 721.90 Lacs), Rs 3,571.94 (including interest of Rs 667.94 Lacs), Rs 2,385.58 Lacs (including interest of Rs 138.71 Lacs) and Rs 1,503.40 Lacs (including interest of Rs 633.94 Lacs) on completion of income tax assessment for the assessment year 2001-02, 2002-03, 2003-04, 2004-05, 2005-06, 2006-07 and 2007-08 respectively. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid to the credit of the Central Govt. under protest.

3. (i) Retail / Project Loans are secured, wholly or partly, by any or all of the following as applicable, based on their categorisation :

a) Equitable / Registered Mortgage of Property.

b) Assignment of Life Insurance Policies, NSC, KVP FD of Nationalized Bank.

c) Assignment of Lease Rent Receivables.

d) Company guarantees or personal guarantees.

e) Negative lien.

f) Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

4. During the year, pursuant to the NHB Circulars dated August 5, 2011 and January 19, 2012 on provisioning norms, the Company had undertaken review of its provisioning policy on loans and inter-alia reassessed the identification, classification & provisioning on the loans for the current financial year. Based on this, the Company has aligned its provisioning policy with the extant guidelines and resultantly reversed excess provision over the NHB norms. Had the provisioning policy of the preceding year been continued, the profit before tax for the year ended March 31, 2012 would have been lower by Rs 11,704.33 Lacs.

5. Housing Loans include loans amounting to Rs 2,246.22 Lacs (Previous year Rs 939.49 Lacs) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. Of this, fair value of the assets possessed, against the loans of Rs 5.48 Lacs (Previous year Rs 114.27 Lacs), is not available as at March 31, 2012. The balance loans amounting to Rs 2,240.73 Lacs (Previous year Rs 825.21 Lacs), have fair value of Rs 2,080.89 Lacs (Previous year Rs 781.01 Lacs), being lower of the fair value of the asset possessed and the outstanding due under the loans as at March 31, 2012.

6. Provision for contingencies includes:

a) Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of the securitized receivables.

b) Provision for probable loss on account of bank reconciliation differences.

7. Pursuant to the shareholder's approval in the Extraordinary General Meeting held on March 5, 2012 the Company had allotted 30,000,000 equity shares of face value of Rs 2/- each at a premium of Rs 268/- per share aggregating to Rs 81,000/- Lacs to Life Insurance Corporation of India, promoter of the Company on a Preferential basis under lock-in period of three years, The said issue was made under chapter VIII of the Securities and Exchange Board of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 as amended.

* For disbursement of housing loans to the individuals for construction / purchase of flat / house as per the norms of the Company, the funds so raised has also improved financial position, capital adequacy and net-worth etc.

8. Fixed Deposits with Banks include Rs 4,296.24 Lacs (Previous Year Rs 1,620.99 Lacs) kept with designated banks for repayment to Public Deposit Holders. The Company has beneficial interest on the income earned from these deposits.

9. Miscellaneous income includes Rs 30.57 Lacs (Previous Year Rs 47.96 Lacs) being management fee from Kotak India Real Estate Venture Fund, ' 3.04 Lacs (Previous Year Rs 2.97 Lacs) being interest income on staff loans/advances, Rs 537.77 Lacs (Previous Year Rs 606.08 Lacs) being gain on unwinding of Interest rate swap, Rs 93.80 Lacs (Previous Year Rs 75.89 Lacs) being old outstanding and unclaimed amounts written back, Rs Nil (Previous Year Rs 155.00 Lacs) being Investment written off realized.

10. Temporary Book Overdraft of Rs 131,991.56 Lacs (Previous Year Rs 109,258.92 Lacs) represents cheques issued towards disbursements to borrowers for Rs 130,749.10 Lacs (Previous Year Rs 108,182.65 Lacs) and cheques issued for payment of expenses of Rs1,242.47 Lacs (Previous Year Rs 1,076.27 Lacs), but not encashed as at March 31, 2012.

* includes 7,250 equity shares (previous year 1,450 equity shares) held by the custodian, which is the registered shareholder for all the owners of Company's GDR.

11. The Company had requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. The disclosure relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have been given to the extent such parties could be identified on the basis of the information available with the company regarding the status of suppliers under MSMED Act, 2006.

12. Derivative Instruments:

a) I nterest Rate SWAP for hedging underlying liability aggregate to Rs 134,600.00 Lacs (Previous year Rs 114,600.00 Lacs).

b) For underlying liability of Rs 65,000.00 Lacs (Previous year Rs 65,000.00 Lacs), Coupon Swap has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

c) The Company as on March 31, 2012 had outstanding interest rate and coupon swaps covering the underlying liability aggregating to Rs 199,600.00 Lacs (Previous year Rs 179,600.00 Lacs). The fair value of all such Swaps as at March 31,2012 was unfavorable to the extent of Rs 24,130.27 Lacs (Previous year Rs 19,136.00 Lacs).

Gratuity Premium is paid to LIC of India under Gratuity Scheme of LIC.

The Company's best estimate of contributions expected to be paid to the plan during the annual period beginning after March 31, 2012 is Rs 106.17 Lacs (Previous Year Rs 126.30 Lacs).

13. Segment Reporting:

The Company is engaged in the business of providing loans for purchase, construction, repairs and renovation. etc. of houses to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. Accordingly, there are no separate reportable segments, as per the Accounting Standard on 'Segment Reporting' (AS 17) issued by the Institute of Chartered Accountants of India / notified under the Companies (Accounting Standards) Amendment Rules, 2011.

*During the year investment in unsecured convertible debentures & advances given to LICHFL Asset Management Co. Ltd. were converted into fully paid up equity shares of LICHFL Asset Management Co. Ltd. at par (face value of Rs 10).

**As the Provision for Performance Linked Incentive (PLI) is accrued for the company as a whole and not decided individually, hence not included.

14. Operating Leases:

The Company has taken various offices and residential premises on cancellable operating lease basis for periods which range from 11 to 120 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Profit and Loss Account for such premises are Rs 1,431.76 Lacs (Previous year Rs 1,269.35 Lacs).

15. Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(viii), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

16. The additional Information pursuant to revised Schedule VI to the Companies Act, 1956 are either Nil or Not Applicable.

17. The financial statements for the year ended March 31, 2011 were prepared as per the then applicable, Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended March 31, 2012 are prepared in compliance with the Revised Schedule VI. Accordingly, the previous year figures have also been reclassified / regrouped / restated to conform to current year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of the financial statements.

18. Disclosure regarding penalty or adverse comments as per Housing Finance Companies (NHB) Directions, 2010. During the current year, the Company has:

a. neither been imposed any penalty by National Housing Bank

b. nor received any adverse comments in writing from National Housing Bank on regulatory compliances.

Figures in bracket are in respect of the previous year.

a. Since the above loans are repayable on demand, there is no repayment schedule for these loans.

b. No interest is charged on the above loans. However, the provisions of section 372A of the Companies Act, 1956 are not applicable to above loans in view of the loanees being subsidiaries of the company.

c. Loans and Advances to employees / customers and investments by such employees / customers in the shares of the Company, if any, are excluded from the above disclosure.


Mar 31, 2010

1. Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) are Rs.13,601,880 (Previous year Rs.12,005,308).

2. Contingent liabilities in respect of:

a. Corporate Undertaking of Rs. 143,500,000 (Previous year Rs.143,500,000) for Securitization transactions.

b. Claims against the Company not acknowledged as debts Rs.620,367 (Previous year Rs.755,367).

c. The Company has received a demand of Rs.31,396,993 towards interest payable, Rs.119,077,050 (including interest of Rs.66,761,297), Rs.233,801,201 (including interest of Rs.13,871,157) and Rs.331,050,489 (including interest of Rs.71,936,658) on completion of income tax assessment for the assessment year 2001-02, 2002-03, 2006-07 and 2007-08 respectively. The said amounts are disputed and the Company has preferred an appeal against the same. The amounts for the respective years have been paid under protest to the credit of the Central Government.

3. (i) Housing loans are secured, wholly or partly, by any or all of the following as applicable, based on their categorization :

a. Equitable / Registered Mortgage of Property.

b. Assignment of Life Insurance Policies, NSC, KVR FD of Nationalized Bank.

c. Assignment of Lease Rent Receivables

d. Company guarantees or personal guarantees.

e. Negative lien.

f. Undertaking to create a security.

(ii) Loans to employees other than for Housing are secured by lien over Provident Fund balances and / or Hypothecation of Vehicles.

4. The Company adopts an approach to provisioning that is based on the past experience, realization of security and other related factors. Additional provisions (over and above the stipulations of the National Housing Bank) in respect of Non-performing Assets (NPA) are made as per the Guidelines prescribed by the Board of Directors. In respect of Standard Assets, the provision on Housing Loans categorized under Retail Loans & Project Loans though not required by National Housing Bank Directions 2001, has been reduced for the current year @ 0.1 percent as against 0.2 percent for Retail Loans and @ 0.5 percent as against 1 percent for Project Loans for the year ended March 31, 2009. Had this practice been followed for the year ended March 31, 2009, the profit before tax would have been Rs.7,635,008,802.

5. Housing Loans include loans amounting to Rs.95,116,460 (Previous year Rs.116,551,212) against which the company has taken possession of the properties under Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 and held such properties for disposal. Of this, fair value of the assets possessed, against the loans of Rs.16,794,754 (Previous year Rs.13,605,241), is not available as at March 31, 2010. The balance loans amounting to Rs.78.321,705 (Previous year Rs.102,945,971), have fair value of Rs.75,010,517 (Previous year Rs.99,234,850), being lower of the fair value of the asset possessed and the outstanding

6. Provision for contingencies includes:

a. Provision for untapped corporate undertaking given for securitization of housing loans. The outflows in respect of untapped corporate undertaking would arise in the event of a shortfall, if any, in the cash flows of the pool of the securitized receivables and

b. Provision for probable loss on account of bank reconciliation differences.

7. The Company has entered into agreement dated July 11, 2009 with Nomura Asset Management Strategic Investment Pte. Ltd. for sale of 1730 equity shares of Rs.10/- each of LIC Mutual Fund Asset Management Company Limited and 2000 equity shares of Rs.10/- each of LIC Mutual Fund Trustee Company Private Limited at a total consideration of Rs.138.40 crores approx. Pending approvals from SEBI and RBI, the effect of the aforementioned transaction is not given in the accounts.

8. Fixed Deposits with Banks include Rs.12,099,208 (Previous Year Rs.11,979,661) kept with designated banks for repayment to Public Deposit Holders . The Company has beneficial interest on the income earned from these deposits.

9. Miscellaneous income includes Rs.5,000,000 (Previous Year Rs.5,000,000) being refund of management fee from Kotak India Real Estate Venture Fund, Rs.203,288 (Previous Year Rs.198,479) being interest income on staff loans/advances, Rs.66,205,419 (Previous Year Rs.58,929,518) being gain on unwinding of Interest rate swap, Rs.6,365,491 (Previous Year Rs.6,157,884) being old outstanding and unclaimed amounts written back, Rs.NIL (Previous Year Rs.22,019,540) being Interest on Income Tax Refund.

10. Temporary Book Overdraft of Rs.8,660,552,460 (Previous Year Rs.6,977,890,200) represents cheques issued towards disbursements to borrowers for Rs.8,495,884,847 (Previous Year Rs.6,871,060,778) and cheques issued for payment of expenses of Rs.164,667,613 (Previous Year Rs.106,829,422), but not encashed as at March 31, 2010.

11. The Company has requested its suppliers to confirm the status as to whether they are covered under the Micro, Small and Medium Enterprises Development Act, 2006. In the absence of confirmations from the suppliers, disclosures, if any, relating to unpaid amount as at the year end together with interest paid / payable as required under the said Act have not been given.

12. Derivative instruments:

a) Interest Rate Swaps for hedging underlying liability aggregate to Rs.6,000,000,000 (Previous year Rs.8,000,000,000).

b) For underlying liability of Rs.6,500,000,000 (Previous year Rs.6,500,000,000), Coupon Swap has been entered into which remains unhedged in respect of movement in respective currencies affecting the coupon amount.

c) The Company as on March 31, 2010 had outstanding interest rate and coupon swaps covering the underlying liability aggregating to Rs. 12,500,000,000 (Previous year Rs. 14,500,000,000). The fair value of all such Swaps as at March ,31, 2010 was unfavourable to the extent of Rs.1,606,912,869 (Previous year Rs.1,999,785,721).

13. Segment reporting:

The Company is engaged in the business of providing loans for purchase, construction, repairs and renovation etc., of houses / flats to Individuals, Corporate Bodies, Builders and Co-operative Housing Societies and has its operations within India. There being only one business segment and geographical segment, the segment information is not provided

14. Related party disclosure:

a) Names of related parties where control exists:

Sr. No. Name of the related party Nature of relationship

1. LICHFL Care Homes Limited Wholly owned subsidiary company

2. LICHFL Financial Services Ltd. Wholly owned subsidiary company

3. LICHFL Asset Management Company Private Ltd. Wholly owned subsidiary company

4. LICHFL Trustee Company Private Ltd. Wholly owned subsidiary company

b) Details of other related parties with whom transactions have taken place:

Sr. No.Name of the related party Nature of relationship

1. Life Insurance Corporation of India (LIC) Enterprise having significant influence

2. LIC Mutual Fund Asset Management Company Limited Associate

3 LIC Mutual Fund Trustee Company Private Limited Associate

4. Mr. R.R. Nair, Director and Chief Executive Key Management Personnel

15. Operating Leases:

The Company has taken various office and residential premises on cancelable operating lease basis for periods which range from 11 to 120 months with an option to renew the lease by mutual consent on mutually agreeable terms. Lease payments recognized in the Profit and Loss Account for such premises are Rs.116,264,536 (Previous year Rs.94,508,854).

16. Current tax:

Provision for current tax is made on the basis of accounting practices consistently followed by the Company, including method of accounting for interest on housing loans and is after availing deduction under section 36(1)(viii) of the Income Tax Act, 1961. For the purpose of determining the quantum of deduction available under section 36(1)(viii), the methodology applied for the bifurcation of income and expenses for long term housing finance has been relied upon by the auditors.

17. Disclosure regarding provisions made for substandard, doubtful and loss assets and depreciation in investments as per the Prudential Norms (revised) contained in the National Housing Bank Guidelines. (Figures in brackets are for the previous year). The provisions given below are in accordance with the approval given by the Board of Directors, which are higher than those required as per National Housing Bank Guidelines.

18. Disclosure regarding penalty or adverse comments as per National Housing Bank Guidelines. During the current year, the Company has:

a) neither been imposed any penalty by National Housing Bank

b) nor received any adverse comments in writing from National Housing Bank on regulatory compliances.

19. During the year the Company has issued and allotted 10,000,000 Equity Shares of face value of Rs. 10/-at a premium of Rs.648/-per share aggregating to Rs.6,580,000,000/- (previous year Rs. NIL) to Qualified Institutional Buyers. The said issue was made under Chapter VIII of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009.

20. Previous years figures are regrouped wherever necessary to correspond with the figures of the Current year.

 
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