Home  »  Company  »  Orient Paper  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Orient Paper & Industries Ltd.

Mar 31, 2016

(b) Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs,1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 March 2016, the amount of per share dividend recognized as distributions to equity shareholders makes Rs,0.25 per share (31 March 2015:Rs, 0.10 per share).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

Notes:

(a) Term loan from a Financial Institution is secured by First pari-passu charge on the fixed assets (both present and Future) pertaining to the Paper plants at Hmlai & Brajrajnagar and carries interest @ 12.05% p.a. (31 March 2015:12.50 % p.a.) and is repayable in 20 equal quarterly installments starting From 28 June, 2014 (upto 28 March, 2019).

(b) Term loan From Banks are secured by first pari-passu charge on the fixed assets (both present and Future) pertaining to the Paper plants at Hmlai & Brajrajnagar.Term loan of Rs, 5735.29 lackhs carries interest @11.10 % p.a (31 March 2015:11.50% p.a.) and C5000 lackhs carries interest @ 10.55% p.a. (31 March 2015: nil). The above loans are repayable in 17 equal quarterly instalments starting From 28 May, 2015 and 20 unequal quarterly instalments starting From 08 May, 2018 respectively, (upto 28 May, 2019 and 8 February, 2023 respectively)

1. Long-term borrowings (contd.)

(c) Term loan from others is secured by pari-passu First charge on the fixed assets (both present and future) pertaining to the Paper plants at Rmlai and Brajrajnagar and carries interest @11.00% p.a. (31 March 2015: nil) and is repayable in 16 equal quarterly instalments starting from 21 March, 2017 (upto 21 December, 2020).

(d) Finance lease obligation is secured against the plant & machinery taken on lease. The gross investments in lease, i.e. lease obligation plus interest, is payable in 117 monthly installments of Rs, 13.50 lackhs each.

Provision for warranties

R provision is recognized for expected warranty claims on products based on management estimate of present obligation in this regard during the warranty period, computed on the basis of past experience of levels of repairs and returns. It is expected that the entire provision will be utilized within two years of the Balance Sheet date, since the warranty period is generally for one or two years. The table below gives information about movement in warranties provisions.

notes:

1. Cash credit (including Working CapitaiDemand Loans) from banks are secured against hypothecation of stock in trade, stock in progress, ram materials, stores and chemicals, book debts and other current assets of the Company and second charge on fixed assets pertaining to the Paper plants at female& Brajrajnagar of the Company and are repayable on demand. The above loans carry interest @ 9.75% p.a. to 10.80% p.a. (31 March 2015:10.25 % p.a. to 11.35% p.a)

2. Loan from Others is secured against pledge of shares held as investments in Century Textiles & Industries Limited by the Company and carries interest @ 10.50% p.a.(31 March 2015:11.25% ) and is repayable on 16 August, 2016.

3. Unsecured Term Loans from a Bank / Others carry interest @ 9.80% to 10.90% p.a.(31 March 2015 :10.25% to 11.00%) and are repayable in 90 days to 366 days .

4. Buyers Credit carries interest @ 0.86 % to 1.18% (31 March 2015 0.86 % p.a. to 1.16 % ) p.a and is repayable in 90 days .

a. Includes assets held in Joint Ownership Rs,1,344.72 lackhs (31 March 2015, Rs,1,344.72 lackhs), which have been charged against the amount payable as rent for the land and proportionate share of expenses.

b. Includes Rs,79.87 lackhs (31 March 2015, Rs, 79.87 lackhs) in respect of hats whose registration in the Company''s name is pending.

c. Includes depreciation Rs,188.64 lackhs (31 March 2015:Rs,197.06 lackhs) on assets at Brajrajnagar unit, where manufacturing operations were not carried on during the year.

d. Land, Buildings and Plant & Equipments of the Paper units at Hmlai & Brajrajnagar, Rir Conditioning unit at Kolkata and land at Faridabad unit of the Company were revalued in earlier years and the resultant surplus thereon was transferred to Revaluation Reserve.

e. Includes plant and equipment taken on finance lease gross block of Rs,800 lackhs (31 March 2015:Rs, nil) and net block Rs, 787.33 lackhs (31 March 2015: Rs, nil)

a) The Company along with other co-owners, has developed a pltoof land and constructed a building thereon at 25, Barakhamba Road, Hew Delhi, where the Company''s share is 15%. The registration of the said pltoof land of value Rs, 432.94 lackhs (31 March 2015: Rs,432.94 lackhs) in the name of the Company is still pending.

b) Government Securities of Face Value Rs, 0.90 lackhs (31 March 2015:C0.90 lackhs) are lodged with Government Departments as Security Deposits.

c) Pledged as security against short term loans taken (note 8)

2. Gratuity - Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed at least five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

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

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled.

3. Leases

Finance lease: company as lessee

The company has a finance lease contract for plant and machinery. This lease has terms of renewal and bargain purchase option. However, there is no escalation clause. Each renewal is at the option of lessee. Future minimum lease payments (MLP) under finance leases together with the present value of the net MLP are as follows:

Operating lease: Company as lessee

Certain office premises, depots etc. are obtained on operating leases. The lease term is for 1-3 years and renewable for further period either mutually or at the option of the Company. There is no escalation clause in the lease agreements. There are no restrictions imposed by lease arrangements. There are no subleases. The leases are cancellable. Rs, In ,

Operating lease: Company as lessor

The Company has leased out certain buildings on operating leases. The lease term is for 1-3 years and thereafter renewable. There is escalation clause in the lease agreements. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancellable.

4. Interest in a joint venture

The Company has 29.34% share of interest valuing Rs, 413.92 lackhs in its Joint Venture Company namely Pan African Paper Mills (EH) Limited, Kenya which is engaged in the manufacturing of Paper.

The Company has ceased to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset, liabilities, income, expenses etc. have been made in these accounts.

5. Segment information

The primary segment reporting format is determined to be business segments as the company''s risks and rates of return are affected predominantly by differences in the products and services produced. Secondary information is reported geographically. The operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Accordingly, the Company has identified "Paper" and "Electrical Consumer Durables" as the business segments.

Paper - Consists of manufacture and sale of pulp, paper & board and chemicals.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, Lights & Luminaries, Appliances & Switchgears.

Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

# represents trade receivable

note: The Company has common fixed assets For producing goods For domestic and overseas markets. Hence, separate figures For fixed assets / additions to fixed assets have not been Furnished.

* net of excise duty.

** Excluding Rs ,21.20 lackhs (31 March 2015, Rs, 4.43 lackhs) being unallocated corporate/other assets.

*** Excluding Rs, 57.81 lackhs (31 March 2015, Rs, 62.61 lackhs) on unallocated corporate/other assets.

6. In October 1963, the paper division of the Company had applied to the Public Work Department (Irrigation) of the Madhya Pradesh State Government for drawing water without any charge from Some River upto 1165 Million Cubic Feet (MCF) with the provision for increase upto 2500 MCF on full development of paper mill, the permission for which was granted by the State Government. In August 2000, the Madhya Pradesh State Government issued a notification and decided to levy charges on water consumption from river resources for industrial purposes with retrospective effect from June, 1998, the constitutional validity of which was challenged by the Company by way of a writ petition in the High Court of Madhya Pradesh. During the pendency of the said writ petition, the Water Resource Department (WRD) of the State Government started raising the bill for consumption of water on the basis of assumption of total quantum of water allowed to be drawn by the Company at 2500 MCF whereas, as per the Company, the quantum of water allowed to be drawn was 1165 MCF and the Company had never drawn the water even upto the initial quantity of 1165 MCF since it had not attained full development of the paper mill. One of the major reasons for not being able to achieve full development was frequent and perennial shortage of water. Based on an interim order passed by the Madhya Pradesh High Court in the aforesaid writ petition, the Company started paying water charges based on actual consumption of water (less than 1165 MCF), while the WRD of the State Government continued to raise bills on the basis of assumed consumption of 2500 MCF plus interest and penalty thereon. In January 2009, the High Court of Madhya Pradesh upheld the constitutional validity of August 2000 notification. After the aforesaid judgment, the Company paid Rs, 908.47 lackhs being the difference amount between the assumed quantity of 1165 MCF and the actual consumption, while the WRD of the State Government continued to raise the bills on the basis of assumed quantity of water consumption of 2500 MCF till April 2009, when the Company entered into a new agreement with the WRD of the State Government for water consumption of only 440 MCF effective from May 2009. The total balance demand for the aforesaid period amounts to Rs, 47434.91 lackhs (including interest and penalty of Rs, 46021.91 lackhs) as at 31 March 2016, for which no provision has been made in the books. The WRD of the State Government issued a notice for recovery of aforesaid demand in February 2015, against which the Company filed a writ petition in the Madhya Pradesh High Court and obtained an interim stay on the recovery. Also, Madhya Pradesh High Court has set aside demand for penal interest in a similar case for another Company. The Company has been legally advised that it has a fit case for quashing the present demand.

7. Due to inadequacy of profit, remuneration paid / provided to Managing Director of the Company during the years ended 31 March 2015 and 31 March 2016 has exceeded the limit prescribed under section 197 read with schedule V of the Companies Act,2013. The Company has applied to the Central government, for approval of excess remuneration amounting to C.178.19 lackhs for the year ended 31 March 2015 and is in the process of applying for obtaining approval for excess remuneration of Rs,177.70 lackhs for the year ended 31 March 2016.

8. Derivative instruments and unmerged foreign currency exposure

Particulars of unmerged foreign currency exposure as at the reporting date

(i) Trade Receivables Rs, 3199.77 lackhs (USD 34.71 lackhs) ,(HKD 104.91 lackhs), (Euro O.Ol.lackhs) [31 March 2015 Rs, 3169.78 lackhs (USD 50.51 lackhs)]. (HKD nil), ( Euro 0.18 lackhs).

(ii) Trade Payables Rs, 2304.80 lackhs (USD 19.84 lackhs), (Euro 11.68 lackhs)& (JPY 167.98 lackhs) [ 31 March 2015 Rs, 1766.21 lackhs (USD 14.59 lackhs),(Euro 11.71 lackhs ) (JPY 109.38 lackhs )].

(iii) Buyers Credit C626.72 lackhs (USD 9.42 lackhs) [ 31 March 2015 Rs, 619.03 lackhs (USD 9.87 lackhs)].

Excluding Directorships in private limited companies, foreign companies and section 8 companies.

Includes the membership/chairmanship only of Audit Committee(s) and Stakeholders'' Relationship Committee(s).

# appointed as Independent Directors of the Company for a term of 5 years w.e.F. 22nd July 2014.


Mar 31, 2015

1. Corporate information

Orient Paper & Industries Ltd. (the Company) is a public Company domiciled in India. Its shares are listed on national and Bombay Stock exchanges in India. The Company is primarily engaged in manufacture & sale of Paper, Electrical Consumer Durables, Chemicals, Industrial Blowers and Air Pollution Control Equipments. The Company presently has manufacturing facilities at fimlai, Brajrajnagar, Faridabad, noida & Kolkata.

2. Basis of preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained below.

3 Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 March 2015, the amount of per share dividend recognized as distributions to equity shareholders was Rs.0.10 per share (31 March 2014: Rs.0.10 per share).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.

4 (a) Term loan from a Financial Institution is secured by first pari-passu charge on the fixed assets (both present and future) pertaining to the Paper plants at Amlai & Brajrajnagar and carries interest @ 12.50% p.a. (31st March 2014: 13% p.a.) and is repayable in 20 equal quarterly installments starting from June 28, 2014.

(b) Term loan from a Bank is secured by first pari-passu charge on the fixed assets (both present and future) pertaining to the Paper plants at Rmlai & Brajrajnagar and carries interest @ 11.50% and is repayable in 17 equal quarterly installments starting from May 28, 2015 .

1. Cash credit / Packing Credit ( including Working Capital Demand Loans) from banks are secured against hypothecation of stock in trade, stock in progress, raw materials, stores and chemicals, book debts and other current assets of the Company and second charge on fixed assets of the Company and are repayable on demand. The above loans carry interest @ 10.25% p.a. to 11.35% p.a. (31st March 2014 10.50 % p.a. to 11.10% p.a)

2. Secured loan from Others is secured against pledge of shares held as investments by the Company. The above loan carries interest 11.25% p.a. and is repayable after 180 days.

3. Unsecured Term Loans from Banks / Others carry interest @ 10.25% & 11.00% p.a.(31st March 2014 10.75% & 11.50%) and are repayable in 90 days to 180 days .

4. Buyers Credit carries interest @ 0.86 % to 1.16% (31st March 2014 1.13 % p.a. to 1.54 % ) p.a and is repayable after 90 days to 180 days.

5 Gratuity - Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee who has completed at least five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

Operating lease: Company as lesor

The Company has leased out certain buildings on operating leases. The lease term is for 1-3 years and thereafter renewable. There is escalation clause in the lease agreements. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancelable.

6 Interest in a joint venture

The Company has 29.34% share of interest valuing Rs.413.92 lacs in its Joint Venture Company namely Pan African Paper Mills (EA) Limited, Kenya which is engaged in the manufacturing of Paper.

The Company has ceased to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset,liabilities, income, expenses etc. have been made in these accounts.

7 Segment information

The primary segment reporting format is determined to be business segments as the company''s risks and rates of return are affected predominantly by differences in the products and services produced. Secondary information is reported geographically. The operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Accordingly, the Company has identified "Paper" and "Electrical Consumer Durables" as the business segments.

Paper - Consists of manufacture and sale of pulp, paper & board and chemicals.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, Lights & Luminaries, Appliances & Switchgears.

Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

8 Related party disclosures

names of related parties and related party relationship

Related parties with whom transactions have taken place during the year

Associate Central India & IndustriesLtd

Key management Mr. M.L. Pachisia (Managing director) personnel Mr. P K. Sonthalia (President Finance & CFO) (w.e.f. 1st April,2014)

Mr. Rakesh Khanna (w.e.f. 1st December 2014)

Mr. Manoj Verma (upto 31st July 2014 )

Mr. Ajay Gupta (w.e.f.4th February 2015)

Mr. n. K. Saha (upto 3rd February2015 )

Mr. B.S. Gilra

Mr. S.B. Bhaiya (upto 2nd April 2013)

Mr. R.P.Dutta (Company Secretary) (w.e.f.1st Hpril,2014)

Enterprises owned or Origami Products significantly influenced by key Origami management personnel or their relatives Origami Tissues

Origami Ventures

Origami Cellulo Pvt Ltd

Origami Enterprises

9 Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs.353.20 lacs (31 March 2014: Rs.1482.26 lacs).

(b) For commitments relating to lease arrangements, please refer note 29.

10 Contingent liabilities Rs. In lacs

a) Outstanding bank 1,476.59 1,527.13 guarantees

b) Bills Discounted under 2,278.02 2,276.69 channel finance facilities

c) Demands/claims by various Government authorities and others not acknowledged as debts and contested by the Company:(*)

Excise Duty 1,741.90 1,588.30

Sales Tax 547.30 505.96

Income Tax 163.53 24.89

Water Tax 6,496.46 5,086.23

Cess on Captive Power consumption 4,377.63 3,625.66

Krishi Upaj Mandi Fees 1,229.56 1,229.56

Others 2,983.73 2,892.63

17,540.11 14,953.23

Against the above, payments have been 639.24 631.53 made under protest and/ or debts have been withheld by respective parties.

(*) Based on discussions with the solicitors/ favorable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision there against is considered necessary.

d) Outstanding claims from employees Amount unascertainable not acknowledged as debts, including Bonus

claims under adjudication and wages for suspension period at Brajrajnagar Unit.

11 In October 1963, the paper division of the Company had applied to the Public Work Department (Irrigation) of the Madhya Pradesh State Government for drawing water without any charge from Sone River upto 1165 Million Cubic Feet (MCF) with the provision for increase upto 2500 MCF on full development of paper mill, the permission for which was granted by the State Government. In August 2000, the Madhya Pradesh State Government issued a notification and decided to levy charges on water consumption from river resources for industrial purposes with retrospective effect from June, 1998, the constitutional validity of which was challenged by the Company by way of a writ petition in the High Court of Madhya Pradesh. During the pendency of the said writ petition, the Water Resource Department (WRD) of the State Government started raising the bill for consumption of water on the basis of assumption of total quantum of water allowed to be drawn by the Company at 2500 MCF whereas, as per the Company, the quantum of water allowed to be drawn was 1165 MCF and the Company had never drawn the water even upto the initial quantity of 1165 MCF since it had not attained full development of the paper mill. One of the major reasons for not being able to achieve full development was frequent perennial shortage of water. Based on an interim order passed by the Madhya Pradesh High Court in the aforesaid writ petition, the Company started paying water charges based on actual consumption of water (less than 1165 MCF), while the WRD of the State Government continued to raise bills on the basis of assumed consumption of 2500 MCF plus interest and penalty thereon. In January 2009, the High Court of Madhya Pradesh upheld the constitutional validity of August 2000 notification. After the aforesaid judgement, the Company paid Rs. 908.47 lacs being the difference amount between the assumed quantity of 1165 MCF and the actual consumption, while the WRD of the State Government continued to raise the bills on the basis of assumed quantity of water consumption of 2500 MCF till April 2009, when the Company entered into a new agreement with the WRD of the State Government for water consumption of only 440 MCF effective from May 2009. The total balance demand for the aforesaid period amounts to Rs. 37,248.55 lacs (including interest and penalty of Rs. 35,835.62 lacs) as at 31st March 2015, for which no provision has been made in the books. The WRD of the State Government issued a notice for recovery of aforesaid demand in February 2015, against which the Company filed a writ petition in the Madhya Pradesh High Court and obtained an interim stay on the recovery. Also, Madhya Pradesh High Court has set aside demand for penal interest in a similar case for another Company. The Company has been legally advised that it has a fit case for quashing the present demand.

12 (a) Reappointment of Managing Director with effect from 23rd September 2014 and remuneration of Rs.178.19 lacs paid during the year ended 31st March, 2015 as in excess of the limit prescribed under Schedule V of the Companies Act, 2013 is subject to approval of the Central Government.

(b) Similarly, reappointment of Managing Director with effect from 23rd September 2013 and remuneration of Rs.203.54 Lacs paid during the year ended 31st March, 2014 as in excess of the limit prescribed under Schedule XIII of the Companies Act, 1956 is subject to approval of the Central Government.

13 Trade Payable, Payable against Purchase of Fixed Assets and Statutory Dues includes Rs.244.71 lacs, Rs.387.31 lacs and Rs.977.55 lacs respectively In respect of cases where litigations are pending.

14 Derivative instruments and unhedged foreign currency exposure

(a) Derivative instrument not for trading or speculation but as hedge of underlying transaction, outstanding as on the Balance Sheet date:-

(i) Forward contracts to sell US$ nil (US$ 15 lacs) to hedge foreign currency sales.

(b) Particulars of unhedged foreign currency exposure as at the reporting date

(i) Trade Receivables Rs.3169.78 lacs (USD 50.51 lacs) ,(Euro 0.18.lacs) [31st March 2014 Rs.3549.43 lacs (USD 59.06 lacs)]. (Euro nil).

(ii) Trade Payables Rs.1766.21 lacs (USD 14.59 lacs), (Euro 11.71 lacs)& (JPY 109.38 lacs) [31st March 2014 Rs.771.76 lacs (USD 12.84 lacs), (Euro nil )(JPY nil)].

(iii) Buyers Credit Rs.619.03 lacs (USD 9.87 lacs) [ 31st March 2014 Rs.1182.82 lacs (USD 19.68 lacs)].

15 Previous year figures

Previous year''s figures have been regrouped and rearranged wherever necessary


Mar 31, 2014

1. Cosh credit / Pocking Credit (including Working Copitol Demond Loons) Prom bonks is secured / to be secured ogoinst hypothecotion of stock in trade, stock in progress, row moteriols, stores ond chemicols, book debts ond other current ossets of the Compony ond second chorge on fixed ossets of the Compony ond is repoyoble on demond. The obove loons corries interest @ 10.50% p.o. to 11.10% p.o. (9.95 % p.o. to 12.30% p.o)

2. Term Loons from Bonks / Others corry interest @ 10.75% & 11.50% p.o. ond ore repoyoble in 89 doys & 180 doys respectively.

3. Buyers Credit corries interest @ 1.13% to 1.54% (1.52 % p.o. to 2.32 %) p.o ond is repoyoble in 180 doys.

a. Includes assets held in Joint Ownership Rs.1,344.72 lacs (31st March 2013, Rs.1341.20 lacs), which have been charged against the amount payable as rent tor the land and proportionate share ot expenses.

b. Includes assets held in Joint Ownership Rs.20.00 lacs (31st March 2013, Rs.20.00 lacs).

c. Includes Rs.79.87 lacs (31st March 2013, Rs.79.87 lacs) in respect ot tlats whose registration in the Company''s name is pending.

d. Land, Buildings and Plant & Equipments ot the Paper units at Hmlai & Brajrajnagar, Hir Conditioning unit at Kolkata and land at Faridabad unit ot the Company were revalued in earlier years and the resultant surplus thereon was transferred to Revaluation Reserve.

e. Capitalized borrowing costs

The borrowing cost capitalized during the year ended 31 March 2014 is Rs.nil (31 March 2013: Rs.1035.60 lacs). The Company has capitalized this borrowing cost in the Capital work-in-progress (CWIP) and Expenditure on Expansion/new Projects. The amount ot borrowing cost shown as Other Hdjustments above reflects the amount of borrowing cost transferred from CWIP and Expenditure on Expansion / new Projects.

f. Includes depreciation Rs.218.22 lacs (31st March 2013: Rs.233.96 lacs) on assets at Brajrajnagar unit, where manufacturing operations were not carried on during the year.

a) Government Securities of the Foce Volue of Rs.0.90 loc (31 Morch 2013: Rs.0.90 loc) ore lodged with Government Deportments os Security Deposits.

b) The Compony olong with other co-owners, hos developed o plot of lond ond constructed o building thereon ot 25, Borokhombo rood, new Delhi, where the Compony''s shore is 15%. The registration of the soid plot of lond of the volue of Rs.432.94 Iocs (31 Morch 2013: Rs.432.94 Iocs) in the nome of the Compony is still pending.

* includes Rs.277.34 Iocs (31st March 2013 Rs. nil) in respect of earlier years.

# Excise duty on sales amounting to Rs.11,487.17 lacs (31 March 2013: Rs.11,653.46 lacs) has been reduced Prom sales in statement of profit & loss and excise duty on increase/ (decrease) in stock amounting to Rs.166.23 lacs (31 March 2013: Rs.3449 lacs) has been considered as (income)/expense in note 22 of financial statements.

4. Gratuity - Defined Benefit Plan

The Company has a defined benefit gratuity plan. Every employee mho has completed at least five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Hct, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

Statement oF profit and loss

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

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to change in the market scenario.

* The management has relied on the overall actuarial valuation conducted by the actuary. However, experience adjustments on plan liabilities and assets are not readily available tor the year 2009-10 and hence not disclosed.

5.Leases

Operating lease: Company as lessee

Certain office premises, depots etc are obtained on operating leases. The lease term is for 1-3 years and renewable for further period either mutually or at the option of the Company. There is no escalation clause in the lease agreements. There are no restrictions imposed by lease arrangements. There are no subleases. The leases are cancelable.

Operating lease: Company as lesor

The Company has leased out certain buildings on operating leases. The lease term is for 1-3 years and thereafter renewable. There is escalation clause in the lease agreements. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancelable.

6. Interest in a joint venture

The Company has 29.34% share of interest valuing Rs.413.92 lacs in its Joint Venture Company namely Pan Hfrican Paper Mills (EH) Limited, Kenya which is engaged in the manufacturing of Paper.

The Company has ceased to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset, liabilities, income, expenses etc. have been made in these accounts.

7. Segment information

The primary segment reporting format is determined to be business segments as the company''s risks and rates of return are affected predominantly by differences in the products and services produced. Secondary information is reported geographically. The operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Accordingly, the Company has identified "Paper" and "Electrical Consumer Durables" as the business segments.

Paper - Consists of manufacture and sale of pulp, paper & board and chemicals.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, lights & luminaries and Appliances.

Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

# Represents trade receivable

note: The Company has common fixed assets for producing goods for domestic and overseas markets. Hence, separate figures for fixed assets / additions to fixed assets have not been furnished.

* net of excise duty.

** Excluding Rs.21.50 lacs (31st March 2013, Rs.42.74 lacs) being unallocated corporate/other assets. *** Excluding Rs.65.82 lacs (31st March 2013, Rs.55.79 lacs) on unallocated corporate/other assets.

8. Related party disclosures

Names oF related parties and related party relationship

Related parties with whom transactions have taken place during the year

Associate : Central India & IndustriesLtd

Key management personnel :

Mr. Mi. Pachisia (Managing director) Mr. Manoj Verma Mr. n. K. Saha Mr. V. Kishore(uptol6thRpril,2012) Mr. B.S.Cilra Mr. 5. B. Bhaiya (upto 2nd Rpril, 2013)

Enterprises owned or significantly influenced by key management personnel or their relatives :

Origami Products Origami Origami Tissues Origami Ventures Origami Cellulo Pvt Ltd OrigamieNTERPRISES

9. Capital and other commitments

(a) Estimated amount of contracts remaining to be executed on Capital Recount and not provided tor (net of advances) Rs.1,482.26 lacs (31 March 2013: Rs.175.27 lacs).

(b) For commitments relating to lease arrangements, please refer note 29

10. Contingent liabilities RsIn lacs 31-Mar-14 31-Mar-13 a) Outstanding bank guarantees 1,527.13 948.34

b) Demands/claims by various Government authorities and others not acknoiuledged as debts and contested by the Company: (*)

Excise Duty 1,588.30 1,523.18

Sales Tax 505.96 595.73

Income Tax 24.89 2,729.77

Water Tax 5,086.23 3,976.40

Cess on Captive Power consumption 3,625.66 2,989.27

Bills Discounted under channel finance facilities 2,276.69 1,083.88

Others 4,122.19 3,204.00

17,229.92 16,102.23

Hgainst the above, payments have been made under protest and/ or debts have been 613.46 702.73

withheld by respective parties.

(*) Based on discussions with the solicitors/ favorable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision there against is considered necessary.

c) Outstanding claims from employees not acknowledged as debts, including Bonus Amount unascertainable claims under adjudication and wages for suspension period at Brajrajnagar Unit.

d) The Company has filed a writ petition in the High Court of Jabalpur, contesting the order of Commissioner Commercial Tax in the case of IOC Ltd regarding taxability of furnace oil at par with diesel. Pending final disposal of this matter, the Company is unable to ascertain the impact of the order, if any, on the accounts of the Company.

11. Water Tax demand received from the Water Resources Department of the Government of Madhya Pradesh has been paid/ provided to the extent of liability admitted by the Company for the period up to Hpril, 2009 i.e. the period prior to new agreement (effective from May 2009) entered into with the Water Resource Department, no provision against the balance demand of Rs.35,908.15 lacs (including compounded interest and penalty) has been made since the Company''s application for waiver thereof is under consideration by the government of Madhya Pradesh.

12. Reappointment of Managing Director with effect from 23rd September 2013 and remuneration of Rs.203.54 Lacs paid during the year ended 31st March, 2014 in excess of the limit prescribed under Schedule XIII of the Companies Hct, 1956 is subject to approval of the Central Government.

13. Derivative instruments and unhedged foreign currency exposure

(a) Derivative instrument not For trading or speculation but as hedge oF underlying transaction, outstanding as on the Balance Sheet date:-

(i) Forward contracts to sell U5$ 15 lacs (nil) to hedge Foreign currency sales.

(b) Particulars oF unhedged Foreign currency exposure as at the reporting date

(i) Foreign Currency Trade Receivables and Trade Payables aggregating to Rs.354943 lacs (USD 59.06 lacs) [Rs.1,927.72 lacs (USD 35.44 lacs) and Rs.771.76 lacs (USD 12.84 lacs) [Rs.68340 lacs (USD 12.56 lacs)] respectively.

(ii) Buyers Credit USD182.82 lacs (USD 19.68 lacs) [Rs.1,34745 lacs (USD 24.77 lacs)].


Mar 31, 2013

1. corporate information

Orient Paper & Industries Ltd. (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India. The Company is primarily engaged in manufacture & sale of Paper, Electrical Consumer Durables, Chemicals, Industrial Blowers and Air Pollution Control Equipments. The Company presently has manufacturing facilities at Amlai, Brajrajnagar, Faridabad & Kolkata. The Cement Undertaking of the Company has been transferred to Orient Cement Limited on going concern basis w.e.f. April 01, 2012 pursuant to the scheme of arrangement approved by the Hon''ble Orissa High Court,

2. BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

3. Scheme of arrangement

a) Pursuant to the Scheme of Arrangement ("the scheme") approved by the Hon''ble High Court of Orissa, all the assets and liabilities of the Cement Undertaking of the Company have been transferred to and vested in Orient Cement Limited (Resulting Company) at their respective book values on a going concern basis from 1st April, 2012 being the appointed date.

As per the scheme, appointed date as approved by the Hon''ble High Court is 1st April, 2012 and effective date is 26th February, 2013, being the date on which the certified copy of the order sanctioning the said scheme is filed with the Registrar of Companies, Orissa in accordance with the Companies Act, 1956.

4. GRATURITY- DEFINED BENEFIT PLAN

The Company has a defined benefit gratuity plan. Every employee who has completed at least five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

5. LEASES

Operating lease: Company as lessee

Certain office premises, depots etc are obtained on operating leases. The lease term is for 1-3 years and renewable for further period either mutually or at the option of the Company. There is no escalation clause in the lease agreements.

There are no restrictions imposed by lease arrangements. There are no subleases. The leases are cancelable.

Operating lease: Company as lesor

The Company has leased out certain buildings on operating leases. The lease term is for 1-3 years and thereafter renewable. There is escalation clause in the lease agreements. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancelable.

6. INTEREST IN A JOINT VENTURE

The Company has 29.34% share of interest valuing Rs. 413.92 lacs in its Joint Venture Company namely Pan African Paper Mills (EA) Limited, Kenya which was engaged in the manufacturing of Paper.

The Company has ceased to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset, liabilities, income, expenses etc. have been made in these accounts.

7. SEGMENT INFORMATION

The primary segment reporting format is determined to be business segments as the Company''s risks and rates of return are affected predominantly by differences in the products and services produced. Secondary information is reported geographically. The operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Accordingly, the Company has identified "Paper" and "Electrical Consumer Durables" as the business segments.

Paper - Consists of manufacture and sale of pulp, paper & board and chemicals.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, lights & luminaries and Appliances.

Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

In addition to above business segments, the Company had Cement business segment till 31st March 2012 which has been demerged w.e.f. 01.04.2012 (refer note 28).

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

8. RELATED PARTY DISCLOSURES

Names of related parties and related party relationship Related parties where control exists

Subsidiary Company Orient Cement Limited (upto 31st March, 2012)

Related parties with whom transactions have taken place during the year

Associate Central India & IndustriesLtd

Key management personnel Mr. M.L. Pachisia (Managing director)

Mr. B. Pandey (upto 31st March, 2012)

Mr. P K Tripathy (upto 31st March, 2012)

Mr. Manoj Verma (From 17th December,2012) Mr. V. Kishore (upto 16th April,2012)

Mr. B.S.Gilra Mr. S. B. Bhaiya

Enterprises owned or significantly influenced by Origami Products key management personnel or their relatives

Origami

Origami Tissues Origami Ventures

9. CAPITAL AND OTHER COMMITMENTS

(a) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs. 175.27 lacs (31 March 2012: Rs. 4236.02 lacs).

NOTE 10.

Water Tax demand received from the Water Resources Department of the Government of Madhya Pradesh has been paid/provided to the extent of liability admitted by the Company for the period up to April, 2009 i.e. the period prior to new agreement (effective from May 2009) entered into with the Water Resource Department. No provision against the balance demand of Rs.28,030.34 lacs (including compounded interest and penalty) has been made since the Company''s application for waiver thereof is under consideration by the government of Madhya Pradesh.

NOTE 11.

Remuneration of Rs.187.70 Lacs paid to Managing Director during the year ended 31st March, 2013 in excess of the limit prescribed under Schedule XIII of the Companies Act, 1956 is subject to approval of the Central Government.

12. Derivative instruments and unhedged foreign currency exposure

(a) Derivative instrument not for trading or speculation but as hedge of underlying transaction, outstanding as on the Balance Sheet date:-

(i) Forward contract in respect of foreign currency trade receivables of USD NIL (USD 2.65 million).

(ii) Cross Currency Swap of JPY/INR Nil (Rs.841.95 lacs ) and Nil (Rs.302.39 lacs) in respect of loan with interest rate @

6 months JPY Libor plus 1.5% vis- a- vis fixed rate of 8.35% and 8.25% respectively.

(iii) Cross Currency Swap of USD/INR Nil (Rs.9,470 Lacs) in respect of loan with interest rate @ 3 months USD Libor plus 2.5% vis- a- vis fixed rate of 8.50% .

(b) Particulars of unhedged foreign currency exposure as at the reporting date

Foreign Currency Trade Receivables (including advances) and Trade Payables aggregating to Rs. 1,927.72 lacs (Rs.498.44 lacs) and Rs.683.40 lacs (Rs. 233.31 lacs ) respectively.

Buyers Credit Rs. 1,347.45 lacs ( Rs. 618.48 lacs).

Loans and advances in the nature of loans given to subsidiaries and associates and firms/ companies in which directors are interested and which are outstanding at the end of the year in terms of Securities and Exchange Board of India''s circular dated January 10, 2003

13. REVIOUS YEAR FIGURES

Previous year''s figures have been regrouped and rearranged wherever necessary. Further, the previous year figures being inclusive of figures of Cement undertaking of the Company which has been demerged w.e.f. 1st April, 2012 (pursuant to a scheme of arrangement refer note 28), are not comparable with the current year''s figures.


Mar 31, 2012

Notes-01[CORPORATE INFORMATION

Orient Paper & Industries Ltd. (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India. The Company is primarily engaged in manufacture & sale of Cement, Paper, Electrical Consumer Durables, Chemicals, Industrial Blowers and Air Pollution Control Equipments. The Company presently has manufacturing facilities at Devapur, Jalgaon, Amlai, Brajrajnagar, Faridabad & Kolkata.

Notes-02-BASIS OF PREPARATION

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year, except for the change in accounting policy explained in 2.1 (a) below.

(a) Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.1 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 March 2012, the amount of per share dividend recognized as distributions to equity shareholders was Rs. 2.00 including interim dividend of Rs.1.00 per share (31 March 2011: Rs.1.50).

(b) Terms of Redeemable Non-Cumulative Preference Shares

Redeemable non-cumulative preference shares issued in earlier years have been redeemed during the year which carried dividend @6% p.a. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors upto the date of redemption is subject to the approval of the shareholders in the ensuing Annual General Meeting.

1. 12.45% Non-Convertible Debentures of Rs.10 lacs each are redeemable at par on November 14, 2013 and these Debentures are secured by first mortgage/charge ranking pari-passu with each other on the moveable and immovable properties pertaining to the Paper Plants at Amlai and Brajrajnagar and Cement plants at Devapur and Jalgaon and a first charge on the Company's freehold land at Mehsana, Gujarat.

2. (a) Term Loans of Rs. 1,144.34 lacs (31st March 2011 Rs. 2,288.69 lacs) carry interest @ 8.25% to 8.35%. The loans are repayable in 6 half yearly installments starting from 31st July, 2009 and ending on 31st July, 2012. The loans are secured by first charge ranking pari-passu with each other on the immovable properties ( both present and future ) pertaining to the Paper plants at Amlai and Brajrajnagar and Cement plant at Devapur and by way of hypothecation of moveable fixed assets (both present and future) ranking pari passu with each other, pertaining to the Paper plants at Amlai and Brajrajnagar and Cement plant at Devapur.

(b) Term Loan of Rs.9,470 lacs (31st March 2011 Rs. 9,470 lacs) carries interest @ 8.50% which is repayable in two equal installments payable on 27th May, 2012 and 27th August, 2012 and term Loan of Rs. 1,664 lacs (31st March 2011 Rs. 3,332 lacs) carries interest @ 8.90% which is repayable in 12 quarterly installments of Rs. 417 lacs each, starting from 30th June, 2010. These loans are secured by first charge ranking pari-passu with each other on the fixed assets (both present and future) pertaining to the Paper plants at Amlai and Brajrajnagar and Cement plants at Devapur and Jalgaon.

3. Deferred sales tax loan is interest free and is payable in 26 installments between February, 2012 to January, 2023.

Provision for Mining Restoration Costs

The activities at the cement unit involve mining of land taken under lease. In terms of relevant statutes, the mining areas would require restoration at the end of the mining lease. The future restoration expenses are affected by a number of uncertainties, such as, technology, timing etc. As per the requirement of Accounting Standard -29, the management has estimated such future expenses on best judgment basis and provision thereof has been made in the accounts. The table below gives information about movement in mining restoration cost provisions.

1. Cash credit from banks is secured / to be secured against hypothecation of stock in trade, stock in progress, raw materials, stores and chemicals, book debts and other current assets of the Company and second charge on fixed assets of the Company. The cash credit is repayable on demand and carries interest @ 10.90% p.a. to 14.90% p.a. ( 10.70% p.a. to 13.15% p.a.)

2. Commercial papers from banks & others carry interest @ 10.25% p.a. to 10.65% p.a and are repayable between a period of 84 days to 172 days.

3. Buyers Credit carry interest @ 3.51% p.a. to 4.31% p.a and is repayable in 180 days.

a. Includes assets held in Joint Ownership with others Rs.1,342.83 lacs (31st March 2011, Rs.191.47 lacs), which have been charged against the amount payable as rent for the land and proportionate share of expenses.

b. Includes Rs.2,766.00 lacs (31st March 2011, Rs.1,866.53 lacs) and Rs.79.87 lacs (31st March 2011, Rs.79.87 lacs) in respect of land and flats respectively whose registration in the Company's name is pending.

c. Land, Buildings and Plant & Equipments of the Paper units at Amlai & Brajrajnagar, Cement unit at Devapur, Air Conditioning unit at Kolkata and land at Faridabad unit of the Company were revalued in earlier years and the resultant surplus thereon was transferred to Revaluation Reserve.

d. Capitalized borrowing costs

The borrowing cost capitalized during the year ended 31 March 2012 was Rs.1,020.63 lacs (31 March 2011: Rs.594.61 lacs). The Company has capitalized this borrowing cost in the Capital work-in-progress (CWIP) and Expenditure on Expansion/New Projects. The amount of borrowing cost shown as Other Adjustments above reflects the amount of borrowing cost transferred from CWIP and Expenditure on Expansion / New Projects.

e. Includes depreciation Rs.275.42 lacs (31st March 2011: Rs.292.63 lacs) on assets at Brajrajnagar unit, where manufacturing operations were not carried on during the year.

a) Government Securities of the Face Value of Rs.0.65 lac (31 March 2011: Rs.0.65 lac) are lodged with Government Departments as Security Deposits.

b) The Company alongwith other co-owners, has developed a plot of land and constructed a building thereon at 25, Barakhamba road, New Delhi, where the Company's share is 15%. The registration of the said plot of land of the value of Rs.432.94 lacs (31 March 2011: Rs.432.94 lacs) in the name of the Company is still pending.

Notes-3 DISCONTINUING OPERATION

The Company's Board of Directors at its meeting held on July 27, 2011 has approved a scheme of arrangement to demerge the cement undertaking of the Company by transferring the same on a going concern basis to a newly formed wholly owned subsidiary namely Orient Cement Ltd. w.e.f 1st April, 2012 subject to approval of court and shareholders.

The Company has filed the scheme with Hon'ble High Court of Orissa. The above cement division is a separate segment as per AS-17, Segment Reporting.

Notes-4-

Orient Cement Ltd. (OCL) was formed during the year as a subsidiary of the Company for the purpose of transfer of Company's Cement business w.e.f 1st April, 2012 as per the scheme of arrangement as stated in note no. 28 above subsequent to all regulatory approvals and compliances. After necessary approvals, shares held by the Company in the said subsidiary will stand cancelled in terms of scheme of arrangement. In view of above, the Company has not prepared Consolidated Financial Statements in terms of paragraph 11 of the Accounting Standard 21 'Consolidated Financial Statements', OCL being the only Subsidiary Company held by the Company.

Notes-5 GRATUITY - DEFINED BENEFIT PLAN

The Company has a defined benefit gratuity plan. Every employee who has completed atleast five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company in the form of qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the plan.

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

The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to the period over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to change in the market scenario.

Notes-6-NTEREST IN A JOINT VENTURE

The Company has 29.34% share of interest valuing Rs. 413.92 lacs in its Joint Venture Company namely Pan African Paper Mills (EA) Limited, Kenya which is engaged in the manufacturing of Paper.

The Company has ceased to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset, liabilities, income, expenses etc. have been made in these accounts.

Notes-7

During the year, the Company's Electrical and Consumer Durable Division has implemented SAP system under ERP platform. Accordingly, the Company has changed its method of valuation of inventory of raw materials, packing materials and stores & spares at the said Division from annual weighted average to transaction moving weighted average. This change has resulted in the profit for the year being higher by Rs. 211.47 lacs.

Notes-8 SEGMENT INFORMATION

The primary segment reporting format is determined to be business segments as the company's risks and rates of return are affected predominantly by differences in the products and services produced. Secondary information is reported geographically. The operating businesses are organized and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. Accordingly, the Company has identified "Paper", "Cement" and "Electrical Consumer Durables" as the business segments.

Paper - Consists of manufacture and sale of pulp, paper & board and chemicals.

Cement - Consists of manufacture and sale of cement.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof, lights & luminaries and Appliances.

Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

Note: The Company has common fixed assets for producing goods for domestic and overseas markets. Hence, separate figures for fixed assets / additions to fixed assets have not been furnished.

* Net of excise duty.

** Excluding Rs. 1079.14 lacs (31st March 2011, Rs. 53.13 lacs) being unallocated corporate/other assets.

*** Excluding Rs. 39.42 lacs (31st March 2011, Rs. 35.13 lacs) on unallocated corporate/other assets.

Notes-9[CAPITAL AND OTHER COMMITMENTS

(a) Estimated amount of contracts remaining to be executed on Capital Account and not provided for (net of advances) Rs. 4,236.02 lacs (31 March 2011: Rs. 13,001.15 lacs).

(b) For commitments relating to lease arrangements, please refer note 32

Notes 10 CONTINGENT LIABILITIES

31st March, 2012 31st March, 2011

a) Outstanding bank guarantees 963.55 702.77

b) Demands/claims by various Government authorities and others not acknowledged as debts and contested by the Company:

Excise Duty 2,068.74 2,125.91

Sales Tax 930.68 931.64

Income Tax 2,730.16 2,875.75

Water Tax 3,102.96 2,416.14

Escot Charges 4,318.60 1,182.60

Others 4,797.39 4,901.28

*17,948.53 14,433.32

Against the above, payments have been made under protest and/ or debts have been withheld by respective parties. 677.74 533.52

* Based on discussions with the solicitors/ favourable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision there against is considered necessary.

c) Outstanding claims from employees not acknowledged as debts, including Bonus claims under adjudication and wages for suspension period at Brajrajnagar Unit.

Amount unascertainable

d) The Company has filed a writ petition in the High Court of Jabalpur, contesting the order of Commissioner Commercial Tax in the case of IOC Ltd regarding taxability of furnace oil at par with diesel. Pending final disposal of this matter, the Company is unable to ascertain the impact of the order, if any, on the accounts of the Company.

Notes-11

Water Tax demand received from the Water Resources Department of the Government of Madhya Pradesh has been paid/provided to the extent of liability admitted by the Company for the period upto April, 2009 i.e. the period prior to new agreement (effective from May 2009) entered into with the Water Resource Department. No provision against the balance demand of Rs. 21,879.32 lacs (including compounded interest and penalty) has been made since the Company's application for waiver thereof is under consideration by the government of Madhya Pradesh.

Notes-4l[DERIVATIVE INSTRUMENTS AND UNHEDGED FOREIGN CURRENCY EXPOSURE

(a) Derivative instrument not for trading or speculation but as hedge of underlying transaction, outstanding as on the Balance Sheet date:

i) Forward contract in respect of foreign currency trade receivables of USD 2.65 million (USD 1.20 million) and foreign currency trade payables of JPY Nil (JPY 1.59 million)

ii) Cross Currency Swap of JPY/INR Rs. 841.95 lacs (Rs. 1683.91 lacs ) and Rs. 302.39 lacs (Rs. 604.78 lacs) in respect of loan with interest rate @ 6 months JPY Libor plus 1.5% vis- a- vis fixed rate of 8.35% and 8.25% respectively.

iii) Cross Currency Swap of USD/INR Rs. 9,470 lacs(Rs. 9,470 Lacs) in respect of loan with interest rate @ 3 months USD Libor plus 2.5% vis- a- vis fixed rate of 8.50% .

(b) Particulars of unhedged foreign currency exposure as at the reporting date

Foreign Currency Trade Receivables (including advances) and Trade Payables aggregating to Rs. 498.44 lacs (Rs. 909.53 lacs) and Rs.233.31 lacs (Rs.400.97 lacs) respectively.

Notes-12[PREVIOUS YEAR FIGURES

Till the year ended 31st March 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31st March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this years' classification. The adoption of revised Schedule VI does not impact recognition and measurement principle followed for preparation of financial statements. However, it significantly impacts presentation and disclosure made in the financial statements, particularly presentation of Balance Sheet.


Mar 31, 2011

1. Nature of Operations:

Orient Paper & Industries Ltd. is primarily engaged in manufacture & sale of Cement, Paper, Electrical Consumer Durables, Chemicals, Industrial Blowers and Air Pollution Control Equipments. The Company presently has manufacturing facilities at Devapur, Jalgaon, Amlai, Brajrajnagar, Faridabad & Kolkata.

31st March, 2011 31st March, 2010

2. Contingent Liabilities not provided for in respect of:

a) Outstanding bank guarantees 702.77 770.91

b) Demands/claims by various Government authorities and others not acknowledged as debts and contested by the Company :

i) Excise Duty 2125.91 1928.81

ii) Sales Tax 931.64 883.85

iii) Income Tax 2875.45 145.20

iv) Water Tax (Refer Note No.9 below) 2416.14 15257.03

v) Others 6083.88 3117.04

14433.32* 21331.93

Against the above, payments have been made under protest and/ 533.51 487.05 or debts have been withheld by respective parties.

c) Outstanding claims from employees not acknowledged as debts, including Bonus claims under adjudication and wages for suspension period at Brajrajnagar Unit. Amount unascertainable

d) The Company has filed a writ petition in the High Court of Jabalpur, contesting the order of Commissioner Commercial Tax in the case of IOC Ltd regarding taxability of furnace oil at par with diesel. Pending final disposal of this matter, the Company is unable to ascertain the impact of the order, if any, on the accounts of the Company.

* Based on discussions with the solicitors/ favourable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision thereagainst is considered necessary.

3. a) Pursuant to the Scheme of Amalgamation as approved by Honble High Court at Calcutta by an order dated 22nd November 2010 , all the assets and liabilities of OPI Export Limited(OPI), a wholly owned subsidiary of the Company, have been transferred to and vested in the Company from 1st April, 2010 at their book values.

b) The Amalgamating Company (OPI) was engaged in the trading and investment business.

d) Profit & Loss Account Debit balance of Rs. 8.22 lacs as on 1st April 2010 of the Amalgamating Company after adjusting Rs. 0.50 Lac being the difference between carrying value of Companys investment in OPI and the amount of share capital appearing in the books of OPI, has been adjusted with General Reserve of the Company.

4. Charity & Donation includes Rs. Nil (Rs. 100 lacs ) paid to All India Congress Committee and Bhartiya Janata Party Rs. Nil (Rs. 50 lacs each) for political purposes.

5. As per approval of shareholders in the extra ordinary general meeting held on 7th March 2011, the Company has allotted 1,20,00,000 share warrants on a preferential basis to certain promoter group companies on 18th March 2011. Each warrant is convertible (at the sole option of the warrant holder) into one equity share of Re 1/- each at a price of Rs. 57.25 per share at any time within a period of 18 months from the date of allotment. Further, the Company has received 25% amount against each such warrant.

6. The Company has 29.34% share of interest valuing Rs. 413.92 lacs in its Joint Venture Company namely Pan African Paper Mills (EA) Limited, Kenya which is engaged in the manufacturing of Paper.

The Company ceases to have joint control over the above Joint Venture Company subsequent to suspension of operations from 30th January, 2009 and in view of the circumstances arising thereafter. Accordingly, no disclosure for interest in said Joint Venture asset, liabilities, income, expenses etc. have been made in these accounts.

7. Water Tax demand received from the Water Resources Department of the Government of Madhya Pradesh has been paid/provided to the extent of liability admitted by the Company for the period upto April, 2009 i.e. the period prior to new agreement effective from May 2009 entered into with the Water Resource Department. No provision against the balance demand of Rs. 17076.58 lacs (including compounded interest and penalty) has been made since the Companys application for waiver thereof is under consideration by the government of Madhya Pradesh.

Provision for Warranty

A provision is recognized for expected warranty claims on products based on management estimate of present obligation in this regard during the warranty period, computed on the basis of past experience of levels of repairs and returns. It is expected that the entire provision will be utilized within two years of the Balance Sheet date, since the warranty period is generally for two years.

Provision for Mining Restoration Costs

The activities at the cement unit involve mining of land taken under lease. In terms of relevant statutes, the mining areas would require restoration at the end of the mining lease. The future restoration expenses are affected by a number of uncertainties, such as, technology, timing etc. As per the requirement of Accounting Standard –29, the management has estimated such future expenses on best judgment basis and provision thereof has been made in the accounts.

8. Excise Duty on sales has been reduced from sales in Profit & Loss Account and Excise Duty on increase/decrease in stocks has been considered as income/expenses in Profit & Loss Account.

9. Gratuity – Defined benefit plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company.

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

x) The Company expects to contribute Rs 475 lacs (Rs. 440 lacs) to Gratuity fund in 2011-2012.

10. a) Derivative Instrument not for trading or speculation but as hedge of underlying transaction, outstanding as on the Balance Sheet date :- i) Forward contract in respect of foreign currency debtors of USD 1.20 million (USD Nil) and foreign currency creditors of JPY 1.59 million (JPY 6.16 million) and CHF Nil (0.41 million).

ii) Cross Currency Swap of JPY/INR Rs. 1683.91 lacs (Rs. 2525.85 lacs) and Rs. 604.78 lacs (Rs. 907.16 lacs) in respect of loan with interest rate @ 6 months JPY Libor plus 1.5% vis-a-vis fixed rate of 8.35% and 8.25% respectively.

iii) Cross Currency Swap of USD/INR Rs. 9470 lacs( Rs. 9470 Lacs) in respect of loan with interest rate @ 3 months USD Libor plus 2.5% vis-a-vis fixed rate of 8.50% .

b) Foreign Currency exposures not hedged as on the Balance Sheet date :- Foreign Currency Debtors (including advances) and Creditors aggregating to Rs.909.53 lacs (Rs. 908.41 lacs) and Rs. 400.97 lacs (Rs. 321.90 lacs) respectively.

11. In case of assets given on lease

Operating Lease:

The Company has leased out certain buildings on operating lease. The lease term is for 1-3 years and thereafter renewable. There is escalation clause in the lease agreement. The rent is not based on any contingencies. There are no restrictions imposed by lease arrangements. The leases are cancelable.

In case of assets taken on lease

Operating Lease:

Certain office premises, depots etc are obtained on operating lease. The lease term is for 1-3 years and renewable for further period either mutually or at the option of the Company. There is no escalation clause in the lease agreement. There are no restrictions imposed by lease arrangements. There are no subleases. The leases are cancelable. (Rs. in lacs)

12. Previous years figures have been regrouped and readjusted wherever necessary. Further, the current years figures being inclusive of figures of OPI Export Ltd. amalgamated with the Company w.e.f. 1st April, 2010 (pursuant to a scheme of amalgamation), are not comparable with the previous years figures.


Mar 31, 2010

1. Nature of Operations:

Orient Paper & Industries Ltd. is primarily engaged in manufacture & sale of Cement, Paper, Electrical Consumer Durables, Chemicals, ndustrial Blowers and Air Pollution Control Equipments. The Company presently has manufacturing facilities at Devapur, Jalgaon, Amlai, Brajrajnagar, Faridabad & Kolkata

31st March, 2010 31st March, 2009 2. Contingent Liabilities not provided for in respect of:

a) i) Guarantees in favour of Banks / Institutions / Bodies - -

Corporate against facilities granted to a Subsidiary - 791.00

ii) Credit facilities availed against the above - 4.92

b) Outstanding bank guarantees 1830.66 683.03

c) Demands/claims by various Government authorities and others not acknowledged as debts and contested by the Company:

a) Excise Duty 1928.81 1378.55

b) Sales Tax 883.85 823.72

c) Income Tax 145.20 -

d) Water Tax 15257.03 11408.25

e) Others 2956.91 2848.80

21171.80* 16459.32

Against the above, payments have been made under protest and/ or debts have been withheld by respective parties.

d) Outstanding claims from employees not acknowledged as debts, including Bonus claims under adjudication and wages for suspension period at Brajrajnagar Unit. Amount unascertainable

e) The Company has filed a writ petition in the High Court of Jabalpur, contesting the order of Commissioner Commercial Tax in the case of IOC Ltd regarding taxability of furnace oil at par with diesel. Pending final disposal of this matter, the Company is unable to ascertain the impact of the order, if any, on the accounts of the Company.

Based on discussions with the solicitors/ favourable decisions in similar cases/legal opinions taken by the Company, the management believes that the Company has a good chance of success in above-mentioned cases and hence, no provision thereagainst is considered necessary.

3 a) Pursuant to the Scheme of Amalgamation as approved by the shareholders the Company and the Honble Board for Industrial and Financial Reconstruction (BIFR) by an order dated 12th March 2010, all the assets and liabilities of Air conditioning Corporation Ltd (ACCL), a wholly owned subsidiary of the Company, have been transferred to and vested in the Company from 1st April, 2009 at their book values

b) The Amalgamating Company (ACCL) is engaged in the business of manufacture and sale of Industrial Blowers and Air Pollution Contro Equipments

c) The Amalgamation has been accounted for under the "Pooling of Interest" method as prescribed by Accounting Standard (AS-14) issued by the Institute of Chartered Accountants of India. Pursuant to the Scheme, all the assets, liabilities and reserves of ACCL as at 1st April, 2009 have been transferred to the Company at their book values as under:

487.05 459.02

d) Profit & Loss Account Debit balance of Rs.193.57 lacs as on 1st April 2009 of the Amalgamating Company after adjusting Rs. 24 Lacs being the difference between carrying value of Companys investment in ACCL and the amount of share capital appearing in the books of ACCL, has been adjusted with General Reserve of the Company.

4. Charity & Donations includes Rs. 100 lacs (Rs. Nil) paid to All India Congress Committee and Bhartiya Janata Party (Rs. 50 lacs each) for political purposes

5. Lease agreements for assets aggregating to Rs. 500 lacs have already expired, but these assets are yet to be formally transferred to the Company by the lessor, pending compliance of the necessary formalities. However, these assets are in physical possession of the Company

6. The Company has 29.34% share of interest valuing Rs. 413.92 lacs in its Joint Venture Company namely Pan African Paper Mills (EA) Limited, Kenya which is engaged in the manufacturing of Paper

The Companys proportionate interest in the said Joint Ventures assets, liabilities, income, expenses etc. for the year ended 31st March, 2010 have not been disclosed in these accounts since the accounts of the Joint Venture Company for the above period are not available due to suspension of operations since 30th January, 2009

7. Against the demand for Water Tax from The Water Resources Department of the Govt. of Madhya Pradesh aggregating to Rs. 14430.11 lacs including compounded interest and penalty upto 31st March, 2010, provision has been made on the basis of liability admitted by the Company since the demand continues to be stayed and is under reconsideration by the Govt. of Madhya Pradesh. Out of the above demand, the Company has provided Rs. 1049.08 lacs (including Rs. 115.03 lacs during the year) and the balance demand amounting to Rs. 13381.03 lacs has been shown as contingent liability.

Provision for Warranty

A provision is recognized for expected warranty claims on products based on management estimate of present obligation in this regard during the warranty period, computed on the basis of past experience of levels of repairs and returns. It is expected that most of the payments will occur in the next financial year and the entire provision will be utilized / incurred within two years of the Balance Sheet date, since the warranty period is generally for two years

Provision for Mining Restoration Costs

The activities at the cement unit involve mining of land taken under lease. In terms of relevant statutes, the mining areas would require restoration at the end of the mining lease. The future restoration expenses are affected by a number of uncertainties, such as, technology, timing etc. As per the requirement of Accounting Standard -29, the management has estimated such future expenses on best judgment basis and provision thereof has been made in the accounts

8. Excise duty on stocks represents differential excise duty on opening and closing stock of Finished Goods

9. Gratuity - Defined benefit plan

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972. The scheme is funded with an insurance company.

The following tables summarize the components of net benefit expenses recognized in the Profit & Loss Account and the funded status and amounts recognized in the Balance Sheet for the plan. (Rs. in lacs)

10. a) Derivative Instrument outstanding as on the Balance Sheet date :-

i) Forward contract in respect of foreign currency debtors of Nil (USD 0.52 million) and foreign currency creditors of JPY 6.16 million (JPY 5.80 million) and CHF 0.41 million (Nil) i) Cross Currency Swap of JPY/INR Rs. 2525.85 lacs (Rs. 2806.51lacs) and Rs. 907.16 lacs (Rs. 1077.97 lacs) in respect of loan with interest rate @ 6 months JPY Libor plus 1.5% vis- a- vis fixed rate of 8.35% and 8.25% respectively.

iii) Cross Currency Swap of USD/INR Rs. 9470 lacs in respect of loan with interest rate @ 3 months USD Libor plus 2.5% vis- a- vis fixed rate of 8.50%

b) Foreign Currency exposures not hedged as on the Balance Sheet date

Foreign Currency Debtors (including advances) and Creditors aggregating to Rs.908.41 lacs (Rs. 541.65 lacs) and Rs. 321.90 lacs (Rs 332.79 lacs) respectively.

Net of Excise Duty.

Excluding Rs.393.54 lacs ( Rs. 24.28 lacs) being unallocated corporate / other assets.

*** Excluding Rs 33.19 Lacs (Rs.32.37 lacs) on unallocated corporate/ other assets.

Note:The Company has common fixed assets for producing goods for domestic and overseas markets. Hence, separate figures for fixed assets / additions to fixed assets have not been furnished.

Notes :

(i) Business Segment: The business segments have been identified on the basis of the products of the Company. Accordingly, the Company has identified "Paper", "Cement" and "Electrical Consumer Durables" as the business segments: Paper - Consists of manufacture and sale of pulp, paper & board and chemicals. Cement - Consists of manufacture and sale of cement.

Electrical Consumer Durables - Consists of manufacture / purchase and sale of Electric Fans - ceiling, portable and airflow, along with Components and Accessories thereof and lights & luminaries. Others - Consist of other miscellaneous business/services comprising less than 10% revenues.

(ii) Geographical Segment: The Company primarily operates in India and therefore the analysis of geographical segments is demarcated into its Indian and Overseas Operations.

(i) Represents stock transferred from amalgamating company on 1st April, 2009. (ii) Equivalent production at 100% contents of Chlorine Gas would be 1875MT.

(iii) Includes 6074 MT (3263 MT) of C S Lye, 15 MT (10MT) of C S Flakes, 2970 MT (2285 MT) of Liquid Chlorine, 23MT (12 MT) of HCL and 3123 MT (1985MT) of Hyp Chlorite consumed departmentally.

-Represents item where manufacturing operations were not carried on during the year. ** After adjusting shortage / excess / reprocessing loss/ quantity discarded etc.

-Including excise duty and export incentives but excludes cash discount, rebates etc.

-Value written off

Notes:

1. Installed capacities have been certified by the management and accepted as correct by the Auditors.

2. Pulp plant is an integrated part of the Paper and Board plants and therefore, capacity and actual production of pulp is not separately ascertained.

3. Sale of Pulp, Paper & Board includes own consumption 7 MT (10 MT)

4. Sale of C S Lye and Hydrochloric Acid includes own consumption 271 MT (142 MT ) and 2787 MT (1511 MT) respectively.

5. Sale of Portland Cement includes own consumption, samples etc. 8698 MT (18278 MT) and sale of clinker 178874 MT (Nil) valuing Rs. 3238.06 lacs (Rs. Nil).

11. Previous years figures have been regrouped and readjusted wherever necessary. Further, the current years figures being inclusive of figures of Air Conditioning Corporation Ltd. amalgamated with the Company w.e.f. 1st April, 2009 (pursuant to a scheme of amalgamation) and figures of chemical division for the full year as against part of the year included in previous year, are not comparable with the previous years figures