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Notes to Accounts of Orissa Sponge Iron & Steel Ltd.

Mar 31, 2015

1. Rights, Preferences and Restrictions attached to Shares:

a) Equity shares

The Company has issued Equity Shares having a par value of Rs, 10. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors, if any, is subject to the approval of shareholders in Annual General Meeting. In the event of liquidation of the Company the holder of the equity shares will be entitled to receive remaining assets of the Company offer settlement of all preferential amounts, The distribution will be in proportion to the number of equity shares held by the equity shareholders.

The rights attached to 30 lakh equity shares out of warrant conversion has been restrained by the Delhi High Court till disposal of the matter,

b) Preference Shares

The Company has issued 2 crores 10 % Cumulative Non (avertable Redeemable Preference Shores of Rs,10 each at par amounting to Rs,2Q crores or by private placement redeemable on the expiry of 12 years from the date of Issue. The shares were allotted to Manet Ispat & Energy Limited amounting 19,51 crores and Torsteel Services Private Limited (a relative party) amounting to Rs,49 lakhs. These shares are not listed,

2. a) Money received against Share Warrants

Equity shore warrants amounting to f 601.50 lacs represent 10 % consideration received from a party against share warrants issued an preferential basis during the year 2007-08. The issue relating to conversion of share warrants to equity has been referred to Securities Appellate Tribunal (SAT) and the decision is awaited.

3. Purim the year State Bank of Bikoner and Jaipur (SBB)) have assigned the financial exposure taken in the Company by transfer of debts, rights and obligations to Edelweiss Asset Reconstruction Company Limited (EARQ vide their letter dated 24.07.2014

4. All the lenders of Term Loan except IREDA viz, SBI, BQI. PNB & EARC hove issued loan recall notice to the company under Section 13(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 during the year. Consequently term loan repayments due and payable to SBF, BOI & PNB have been shown undercurrent maturity.

5. Term loans from banks and other parties are secured / to be secured by joint equitable mortgage by deposit of title deed of immovable properties and hypothecation of all moveable assets of the Company both present and future (save and except book debts) ranking pan-passu subject to prior charge created in favor of the Company's bankers far securing working capital finance on stock of raw material, finished goods etc. and also by second charge on current assets. Further, the above term loans have been guaranteed by the personal guarantee of the Vice Chairman & Managing Director if the Company.

6. interest and maturity profile on Term Loans are set out below:

Interest an term loan from banks and other parties carry interest @ 1 5.75% to 16.75 % and 10% to 12.89 % respectively.

7. Disclosure as reburied under AS 29

Provision for Entry Tax, Sales To* and Interest on Bonk Borrowings have been recognized In the financial statements considering the following:

i) The Company has a present obligation as a result of past event

ii) It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation: and

iii) Are liableness tamale can be made of the amount of the obligation.

8. During the year State Bank of Bikaner and Japura (SBBJ) have assigned the financial exposure taken in the Company by transfer of debts, rights and obligations to Edelweiss Asset Reconstruction Company Limited (EARQ vide their letter dated 20.07.2014.

9. All the lenders of working capital to the Company viz. SBI, BOI. & EARC have issued loan recall notice to the Company under Section

10.(2) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 during the year.

11. Gash Credit from banks are sanctioned on a consortium basis by hypothecation of raw materials, finished goods, stores and spares, hook debts etc, pari-passu secured charge on immovable properties and other fixed assets and also guaranteed by personal guarantee of vice- chairman of the Company (Dr. P. K. Mohanty). The above cash credit is repayable on demand and carries interest @15.75 % to 17.15 %.

* Based on and to the extent of information obtained from suppliers regarding their status as Micro, Small or Medium enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to them as at the end of the year.

12. Loons and advances to related parties includes:

Advances to Bilati (Orissa) Ltd (BOL) - doubtful Rs, 1,927.51 Iocs (Rs, 1,927.51 lacs)

As the prospect of reviving of Bilati (Orissa) Ltd. (which is under BIFR). appears to be uncertain, provision has been made for advances due from Bilati (Orissa) Ltd.

13. Lang Term Advances under doubtful Includes claim receivable amounting to of 119.QC lacs from Mahanadl Coalfield Ltd. Mahanadl Coalfield Ltd. encased the bonk guarantee given to them for purchasing of coal under the jells supply agreement The Company has contested such encashment of bank guarantee and the matter is subjudice.

14. Advqnce to Bamra Iron & Steel Company (India) Limited amounting to Rs, 8,525.770 has been written off as the name of the said company has been struck off from the Register of Companies as per Order of the Registrar of Companies, Odisha.

b) Defined Benefit Plans :

i) Compensated Absences: Liability for Compensated Absences is provided on the basis of valuation, as at the Balance Sheet date, carried out by an independent actuary. The actuarial valuation method used for measuring the liability is, the Projected Unit Credit method. Under this method, the Defined Benefit Obligation is calculated taking into account pattern of avail meat of leave while in service and qualifying salary and the date of a ailment of leave. In respect of encashment of leave, the Defined Benefit obligation is calculated taking into account in qualifying salary projected up to the assumed date of encashment

15. Subsidiary Company

Bamra Iron h. Steel Company (India) Limited, is a wholly owned subsidiary has been struck off from the Registrar of Companies to non Operation by the order of Registrar of Companies Desha. Consequently the provisions relating to subsidiary Companies are not applicable for the reporting period.

In computing diluted corning per share equity share warrants (10% consideration of 35,00,000 equity shares) allotted an preferential basis has been excluded as the conversion of warrants into equity shares is under sub-juice. 35, As the Company's business activity falls within a single primary business segment, viz. "Iron & Steel" the disclosure requirement of Accounting

Standard 17-Segment reporting are not applicable. 36- Related Party d Indosuez under Accounting Standard -1B

A. Name of related party and relationship :

I. Subsidiary : Bamra Iron and Steel Company (India) Limited,

II. Associates : Torsteel Research Foundation In India

TRFl Investment Pvt. Ltd.

OSIL-TRFI Community Services

OSIL-TRFI Community Services Trust

Bilati (Orissa) Limited

Torsteel Services Pvt Ltd.

Keonjhar Infrastructure Development Company Limited HI. Key Management Personnel : Dr. P. K. Mohanty

Mr. Munir Mohanty

16. Exceptional item represent written off advance Rs. 85.26 lacs end investment Rs. 74.99 lacs in the subsidiary company Bamra Iron fit Steel Company (India) Limited,

17. All the amounts in Rupees have been rounded off to lacs with thousands in decimals.

18. Previous year's figures

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


Mar 31, 2014

1. Bamra Iron & Steel Company (India) Limited (Bamra)

Bamra Iron & Steel Company (India) Limited, is a wholly owned subsidiary of the Company. As the Company has not yet started operations and project is under implementation consolidated financial statement (AS-21) has not been prepared.

2. Lease

Fixed Assets acquired under Finance Leases:

The Company has acquired vehicles under finance lease. The year wise break-up of outstanding lease obligations are as under:

2013-14 2012-13 Rs lacs Rs / lacs

3. Contingent Liabilities and Commitments

(A) Contingent liabilities

(a) Claims against the Company not acknowledge as debts:

i) Disputed Sales Tax (under appeal) 3,313.31 3,313.31

Includes ? 1,369 lacs is for non submission of declaration forms, out of which ? 1,357.79 lacs has since been collected / submitted and Rs 1,962.31 lacs other disallowance items ii) Disputed Central Excise and Service Tax (under appeal) 155.33 155.33

iii) Income Tax Demand (under appeal ) 3.27 3.27

iv) Other Claim not acknowledged as debt 2,090.14 12.45

* (includes case filed by a party claiming Rs 3,285.24 lacs out of which Rs 1,255.55 lacs is admitted by the Company. Case is filed before Orissa High Court. Previous year ? Nil)

(b) Guarantees

i) Letters of Credit and for Counter Guarantees to the Banks for guarantees given by them 560.30 560.30

ii) Guarantee given to Keonjhar Central Co-Operative Bank Ltd. for cash credit facilities obtained by Bilati (Orissa) Ltd. 126.93 126.93

iii) Joint Undertaking given for "over-run / shortfall and Guarantee-cum- Undertaking", in debt servicing in the event of default, in connection with term loan of ? 58 crores, granted by State Bank of India to Keonjhar Not Not

Infrastructure Development Company Ltd. (KIDCO) AscertainableAscertainable

(B) Commitments

i) Estimated amount of contracts (Net of advance 55.16 lacs, previous year RS 55.16 lacs) remaining to be executed on Capital Account and not provided for. 229.35 229.35

ii) Other Commitments Nil Nil

4. As the Company''s business activity falls within a single primary business segment, viz. "Iron & Steel" the disclosure requirement of Accounting Standard 17-Segment reporting are not applicable.

5. Related Party disclosures under Accounting Standard -18 A. Name of related party and relationship :

I. Subsidiary : Bamra Iron and Steel Company (India) Ltd.

II. Associates : Torsteel Research Foundation in India

TRFI Investment Pvt. Ltd.

OSIL-TRFI Community Services

OSIL-TRFI Community Services Trust

Bilati (Orissa) Ltd.

Torsteel Services Pvt. Ltd.

Keonjhar Infrastructure Development Company Ltd.

III. Key Management Personnel :

Dr. P. K. Mohanty Mr. Munir Mohanty

6. All the amounts in Rupees have been rounded off to lacs with thousands in decimals.

7. Previous years figures

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

1. Name of the Subsidiary : BAMRA IRON & STEEL COMPANY (INDIA) LTD.

2. The Financial Year of the Subsidiary Company ended on : 31st March 201 4

3. a) No. of shares held by Orissa Sponge Iron & Steel Ltd. : 7,49,930 Equity Shares of Rs.10 each b) Extent of holding at the end of

Financial Year of Subsidiary Company : 99.99%

4. The net aggregate amount of the Subsidiary Company profit/(loss) so far as it concerns the members of the holding Company: :

a) Not dealt with in the holding accounts :

i) For the financial year ended 31st March 2014 : NIL

ii) For the previous financial years

of the Subsidiary Company since

it became the holding Company''s subsidiary : Not Applicable

b) Dealt with in the holding Company''s accounts :

i) For the financial year ended 31st March 2014 : NIL

ii) For the previous financial years of the Subsidiary Company since it became the holding Company''s subsidiary : Not Applicable


Mar 31, 2013

1. CORPORATE INFORMATIONS

Orissa Sponge Iron & Steel Limited was incorporated in the year 1979. The Company established its works at Palaspanga, Dist Keonjhar, Odisha for manufacturing Sponge Iron by direct reduction method and generation of power from Waste Heat. The Company has also a manufacturing facility at Palaspanga for Steel Billet.

The Company''s performance has been adversely impacted due to mismatch of the raw materials cost and sale price of sponge Iron. The viability and stability of stand alone sponge iron unit is largely dependent on availability of raw materials from captive sources. The Company had applied for allocation of an iron ore mine which was granted by the State Government with the concurrence of Central Government in the year 2004 in accordance with the prevailing laws. As required the Company had secured approval of mining plan and other clearance such as pullution control, environment etc. However the forest clearance from the Ministry of Environment and Forest which was pending for last 8 years even after the recommendation of the State Government was finally received on 3rd June 2013. The Company hope to fulfil all terms and conditions stipulated thereon and commence mining in approximately 18 months. Use of iron ore from own mines will reduce cost by nearly 50 % and allow the company to vastly improve profitability and recoup all losses.

2. Bamra Iron & Steel Company (India) Limited (Bamra)

Bamra Iron & Steel Company (India) Ltd. is a wholly owned subsidiary of the Company. As the Company has not yet started operations and project is under implementation consolidated financial statement (AS-21) has not been prepared.

3. As the Company''s business activity falls within a single primary business segment, viz. "Iron & Steel" the disclosure requirement of Accounting Standard 17-Segment reporting are not applicable.

4. Related Party disclosures under Accounting Standard -18 A. Name of related party and relationship :

I. Subsidiary : Bamra Iron and Steel Company (India) Ltd.

II. Associates : Torsteel Research Foundation in India

TRFI Investment Pvt. Ltd. OSIL-TRFI Community Services OSIL-TRFI Community Services Trust Bilati (Orissa) Ltd. Torsteel Services Pvt. Ltd.

5. All the amounts in Rupees have been rounded off to lacs with thousands in decimals.

6. Previous years figures

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


Mar 31, 2012

1.1 Rights, Preferences and Restrictions attached to Shares:

a) Equity shares

The Company has issued Equity Shares having a par value of Rs. 10. Each holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors, if any, is subject to the approval of shareholders in Annual General Meeting. In the event of liquidation of the Company the holder of the equity shares will be entitled to receive remaining assets of the Company after settlement of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the equity shareholders.

b) Preference Shares

The Company has not issued any Preference Shares. Subject to the provisions of Section 80 of the Companies Act, 1956 preference shares can be issued by the Company with the sanction of an ordinary resolution on the terms that they are, or at the option of the Company liable to be redeemed in such terms and on such manner as the Company, before the issue of the shares may, by special resolution, determine.

1.2 Rights attached to 30 lacs equity shares out of warrant conversion cannot be exercised as the matter is sub-juiced.

2. Money received against Share Warrants

Equity share warrants amounting to Rs. 601.50 lacs represent 10% consideration received from a party against share warrants issued on preferential basis during the year 2007-08. The conversion of share warrants to equity is subjudice.

2.1 Term loans from banks and other parties are secured / to be secured by joint equitable mortgage by deposit of title deed of immovable properties and hypothecation of all moveable assets of the company both present and future (save and except book debts) ranking pari-passu subject to prior charges created in favour of the company's bankers for securing working capital finance on stock of raw material, finished goods etc. and also by second charges on current assets. Further, the above term loans have been guaranteed by the personal guarantee of the Vice Chairman & Managing Director of the Company.

2.2 Interest and maturity profile on Term Loans are set out below :

Interest on term loan from banks and other parties carry interest @ 15% to 16.75 % and 10% to 13.50 % respectively.

Debt re-structuring proposal of the Company for the above is under consideration of the lenders.

Disclosure as required under AS 29

Provision for Sales Tax and Entry tax have been recognized in the financial statements considering the following :

i) The company has a present obligation as a result of past event.

ii) It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and

iii) A reliable estimate can be made of the amount of the obligation.

6.1 Cash Credit from banks are secured on a consortium basis by hypothecation of raw materials, finished goods, stores and spares, book debts etc. and also by pari-passu second charges on the immovable properties and also by second charges on fixed assets. The cash credit is payable on demand and carries interest @ 15.05 % to 17.50 %. Further, the above Cash Credit from banks have been guaranteed by the personal guarantee of the Vice Chairman & Managing Director of the Company.

* Excluding interest not debited by Banks.

* Default in Cash Credit represents outstanding balance in excess of Drawing Power as on 31.03.2012 confirmed by the banks. The Company has submitted restructuring proposal to banks, which is under consideration.

* Based on and to the extent of information obtained from suppliers regarding their status as Micro, Small or Medium enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to them as at the end of the year.

Note:

1. Cost at beginning of year includes increase in valuation of Rs. 1,042.01 lacs and Rs.5,091.98 lacs in Buildings and Plant & Machinery respectively on Revaluation of assets as at 31st March, 1993 due to revaluation.

2. Depreciation includes of Rs. 719.43 lacs (Rs. 687.41 lacs) and Rs. 5,013.32 lacs (Rs. 4,967.49 lacs) in Building and Plant & Machinery respectively on increased of value of assets due to revaluation.

3. Fixed Assets include vehicles acquired under finance lease with a Gross Block of Rs. 36.32 lacs (Rs. 98.83 lacs), Accumulated Depreciation of Rs. 3.26 lacs (Rs. 27.13 lacs) and Net Block of Rs. 33.06 lacs (Rs. 71.70 lacs)

3.1 ** Investment in equity share of Keonjhar Infrastructure Development Company Ltd. (KIDCO) amounting to Rs. 0.72 lacs (Rs. 0.72 lacs in 2009-10) has been pledged with State Bank of India (SBI) as security for loan granted to KIDCO by SBI.

It is expected that the company will be able to earn sufficient profit in future years to recoup the deferred tax assets on commencement of mining from the mines allocated to the Company, which is awaiting approval of appropriate authorities.

4.1 Loans and advances to related parties includes

Advances to Bilati (Orissa) Ltd (BOL) - doubtful Rs. 1,873.83 lacs.

Advance to Bamra Iron & Steel Company (India) Ltd. (Bamra) - Rs. 83.82 lacs.

In spite of best effort, the prospect of reviving BOL, appears to be uncertain, hence provision has been made.

4.2 Advance recoverable in cash or in kind includes provision for doubtful advances to Neelachal I spat Nigam Limited (NINL) for Rs. 273.62 lacs. Provision has been made for claims receivable from NINL, though the management is perusing for recovery.

5. Exceptional items

Exceptional item represents de - recognition of CER credit pending certification by UNFCCC as per guidelines issued by ICAI. In the earlier years CER credit was considered on the basis of net realizable value of estimated accrued CER units.

b) Defined Benefit Plans :

i) Compensated Absences : Liability for Compensated Absences is provided on the basis of valuation, as at the Balance Sheet date, carried out by an independent actuary. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method. Under this method, the Defined Benefit Obligation is calculated taking into account pattern of a ailment of leave while in service and qualifying salary on the date of a ailment of leave. In respect of encashment of leave, the Defined Benefit obligation is calculated taking into account in qualifying salary projected up to the assumed date of encashment.

6. Bamra Iron & Steel Company (India) Limited (Bamra)

Bamra Iron & Steel Company (India) Ltd. is a wholly owned subsidiary of the Company. As the Company has not started operations and project is under implementation consolidated financial statement (AS-21) has not been prepared.

The Company's initiative for expansion and obtaining iron ore mining lease was based on creating production facilities of one million tonne of steel production. Bamra Iron & Steel Company (India) Limited was floated as a wholly owned subsidiary Company for implementing expansion programme of the Company. The project implementation at present is on hold as there are delays in obtaining iron ore mining lease due to certain technical reasons.

Investments in Bamra as on 31 st March 2012 is as follows :

1. Investment in equity share capital :Rs. 75.00 lacs (Rs. 75.00 lacs)

2. Advances :Rs. 83.82 lacs (Rs. 83.56 lacs)

2011-12 2010-11 Rs. / lacs Rs. / lacs

7. Contingent Liabilities and Commitments

(A) Contingent liabilities

(a) Claims against the company not acknowledge as debts:

i) Disputed Sales Tax (under appeal) 3,303.41 3,403.36

ii) Disputed Central Excise and Service Tax (under appeal) 175.67 49.17

iii) Income Tax Demand (under appeal) 3.27 393.49

iv) Claim made by a supplier contested by the company net of admitted liability 9.06 -

(b) Guarantees

i) Letters of Credit and for Counter Guarantees to the Banks

for guarantees given by them. 691.27 811.28

ii) Guarantee given to Keonjhar Central Co-Operative Bank Ltd. for cash credit facilities obtained by Bilati (Orissa) Ltd. 126.93 126.93

iii) Joint Undertaking given for over-run / shortfall and Guarantee-cum-

Undertaking", in debt service account and debt repayment in the event of Not Not default, in connection with term loan of Rs. 58 crores, granted by State Bank Ascertainable Ascertainable of India to Keonjhar Infrastructure Development Company Ltd. (KIDCO).

KIDCO has been floated by mine owners and industries of the localities including Orissa Sponge Iron & Steel Limited for development of Palaspanga - Bamebari Road under BOT arrangement.

(c) Claim not acknowledged as debt 32.73 -

(B) Commitments

i) Estimated amount of contracts (Net of advance Rs. 54.01 lacs, previous year Rs. 182.44 lacs) remaining to be executed on Capital Account and not provided for. 241.34 443.72

ii) Other Commitments Nil Nil

In computing diluted earnings per share equity share warrants (10% consideration of 35,00,000 equity shares) allotted on preferential basis has been excluded as the conversion of warrants into equity shares is under sub-judice.

8. As the Company's business activity falls within a single primary business segment, viz. "Iron & Steel" the disclosure requirement of Accounting Standard 17-Segment reporting are not applicable.

9. All the amounts in Rupees have been rounded off to lacs with thousands in decimals.

10. Previous year's figures

The revised Schedule VI has become effective from 1 st April 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Mar 31, 2010

1) Considering commercial viability and better realization from the sale of surplus power generated from waste heat power project, the company has suspended the production of billet temporarily towards the end of the year.

2) As per sale agreement entered between GRIDCO Ltd., Bhubaneswar and the Company for sale of power dated 16th day of September 2009, the Company has been evacuating surplus power for sale to GRIDCO after meeting the captive requirement, generated from Waste Heat Power Plant.

3) The capacity of waste heat power project has been expended in January, 2009. The certification of the expanded capacity, as a valid project for entitlement of allotment of CER, is pending. Pending certification, carbon credit accrued and estimated by Accredited Agencies, from the certified project upto 31st December, 2008 has been considered for estimating the accrued CER. The CER accrued from the expanded project will be considered after obtaining approval of CDM registration.

During the year there is no sale of CER. The difference between valuation in opening and closing accrued CER units are shown as (decrease) / increase in other income (Schedule - 9).

4) Equity share warrants amounting to Rs. 601.50 lacs represents 10 % consideration received from a party against share warrants issued on preferential basis during the year 2007-08. The conversion of share warrants to equity is sub-judice and pending before High Court of Orissa, Cuttack.

5) Rs. 274 lacs is due from Neelachal Ispat Nigam Ltd. (NINL) for certain claims. As per legal advice obtained from eminent Advocates, the claim is payable by NINL. The Management is pursuing the recovery and confident of realizing the amount.

6) Bilati (Orissa) Ltd. (BOL)

Bilati (Orissa) Ltd. (BOL), was promoted by the Company along with Torsteel Research Foundation in India (TRFI) and Orissa Agro Industries Corporation Ltd. for setting up a food processing and horticulture unit in Keonjhar for socio-economic development of the region. A State- of-Art Fruits and Vegetables processing plant of stainless steel imported from Italy with a large processing capacity was set up. Production could not be achieved at the sustainable level due to non-availability of adequate working capital. Consequently, BOL became a sick company. Management considered that BOL as a debt-free company is a viable unit and could meet the objective for which project was contemplated.

7) Bamra Iron & Steel Company (India) Limited (Bamra)

The Companys initiative for expansion and obtaining iron ore mining lease was based on creating production facilities of one million tonne of steel production. Bamra Iron & Steel Company (India) Limited was floated as a wholly owned subsidiary Company for implementing expansion programme of the Company.

8) The advances recoverable include payment of Rs. 273.69 lacs to Noth-Eastern Electricity Supply Company Ltd. (NESCO) for enhanced tariff as per notification for the period May 1996 to 31 st March 1997. Honourable High Court, Cuttack, Orissa has set aside the said notification as "Not sustainable". NESCO has filed an appeal in the Honourable Supreme Court of India and decision is still pending. In view of the Honourable High Court decision, the aforesaid amount has been considered as good and recoverable.

9) The management has reviewed the impairment of Fixed Assets during the year and there are no such impairment of assets.

10) Based on and to the extent of information obtained from suppliers regarding their status as Micro, Small or Medium enterprises under the Micro, Small and Medium Enterprises Development Act, 2006, there are no amounts due to them as at the end of the year.

11) Estimated amount of contracts (Net of advance) remaining to be executed on Capital Account and not provided for amounts to Rs. 129.67 lacs (Rs. 235.20 lacs).

12) Prior period items include ^ 151.45 lacs paid to NESCO for settling claim of delayed payment surcharges in respect of earlier years.

13) Raw material stock includes coal char stock of Rs. 209.06 lacs (previous year Rs. 177.99 lacs) which will be consumed for power generation through coal fired boiler. Coal char is a waste generated from the process and valued at net realizable value.

14) Contingent liabilities not provided for: 2009-10 2008-09 i) For Letters of Credit and for Counter Guarantees to the Banks 1,357.24 735.17 for guarantees given by them.

ii) Disputed Sales Tax (under appeal) 2,973.63 2,973.63 (Includes Rs. 1,175.80 lacs towards disallowance of branch transfer and consignment transfer of finished goods and Rs. 940.67 lacs is for non-submission of declaration forms, out of which Rs. 887.39 lacs have since been collected / submitted).

iii) Disputed Central Excise (under appeal) 44.76 44.76

iv) Income Tax Demand (under appeal) 85.22 210.01

v) Interest on TDS for different years (under appeal) - 1.39

vi) Minimum Demand charges (Electricity) - 153.85

vii) Interest for delayed payment of Sales Tax & Excise Duty loan 145.04 -

15) As the Companys business activity falls within a single primary business segment, viz. Iron & Steel" the disclosure requirement of Accounting Standard 17 - Segment reporting issued by ICAI are not applicable.

16) DISCLOSURES IN ACCORDANCE WITH REVISED AS-15 ON "EMPLOYEES BENEFITS" a) Compensated Absences:

Liability for Compensated Absences is provided on the basis of valuation as at the Balance Sheet date, carried out by an Independent actuary. The Actuarial valuation method used for measuring the liability is the Projected Unit Credit method. Under this method, the Defined Benefit Obligation is calculated taking into account pattern of availment of leave while in service and qualifying salary on the date of availment of leave. In respect of encashment of leave, the Defined Benefit obligation is calculated taking into account in qualifying salary projected up to the assumed date of encashment.

17) The Company has not prepared the Consolidated Financial Statement as required under Accounting Standard - 21 (AS-21), since the subsidiary of the Company has not started project implementation during the year and transactions done by the Company is not material. However separate financial statements of the Subsidiary is presented.

18) Related Party disclosures under Accounting Standard -18 A. Name of related party and relationship :

I. Subsidiary Bamra Iron and Steel Company (India) Ltd.

II. Associates Torsteel Research Foundation in India

TRFI Investment Pvt. Ltd. OSIL-TRFI Community Services Bilati (Orissa) Ltd. Torsteel Services Pvt. Ltd.

III. Key Management Personnel

Dr. P. K. Mohanty Mr. Munir Mohanty Mr. M. A. Khan

IV. Enterprises over which Key Management Torsteel Research Foundation in India Personnel exercise significant interest TRFI Investment Pvt. Ltd.

OSIL-TRFI Community Services Bilati (Orissa) Ltd. Torsteel Services Pvt. Ltd.

19) All the amounts in Rupees have been rounded off to lacs with thousands in decimals.

20) Previous years figures have been regrouped and reclassified wherever necessary.

 
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