Mar 31, 2023
The reserve estimates for producing fields are revised based on the performance of producing fields and with respect to discovered fields, the revision are based on the revised geological and reservoir simulation studies.
36.3 The Government of India (GOI), by its letters dated 2nd May, 2012, 14th November, 2013, 10th July, 2014 and 3rd June 2016 has disallowed certain costs which the Production Sharing Contract (PSC), relating to Block KG-DWN-98/3 entitles the Company to recover. The Company continues to maintain that the Contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the GOI to disallow the recovery of any Contract Cost as defined in the PSC. The Company referred the issue to arbitration with GOI for resolution of disputes. The demand from the GOI of $ 165 million (C 1,353 crore) being the Company''s share (total demand $ 247 million - C 2,029 crore) towards additional Profit Petroleum has been considered as contingent liability in the financial statements for the year ended 31st March, 2023. The next date of hearing is awaited.
In supersession of the Ministry''s Gazette notification no. 22011/3/2012-ONG.DV. dated 10th January, 2014, the GOI notified the New Domestic Natural Gas Pricing Guidelines, 2014 on 26th October 2014. The GOI had directed the Company to instruct customers to deposit differential revenue on gas sales from D1D3 field on account of the prices determined under the guidelines converted to NCV basis and the prevailing price prior to 1st November 2014 ($ 4.205 per MMBTU) to be credited to the gas pool account maintained by GAIL (India) Limited. The amount so deposited by customer to Gas Pool Account is C 295 crore (net) as at 31st March, 2023. Revenue has been recognized at the GOI notified prices on GCV basis, in respect of gas quantities sold from D1D3 field from 1st November 2014. This amount in the Gas Pool Account has also been challenged under cost recovery arbitration and is pending adjudication.
36.4 (a) GOI sent a notice to the KG D6 Contractor on 4th November, 2016 asking the Contractor to deposit approximately US$ 1.55 billion on account of alleged gas migration from ONGC''s blocks. The Company, as Operator, for and on behalf of all constituents of the Contractor, initiated arbitration proceedings against the GOI contesting its unfair claim. The Arbitral Tribunal vide its Final Award dated 24th July, 2018 upheld Contractor''s claims. GOI filed an appeal on 15th November, 2018 before the Hon''ble Delhi High Court, under section 34 of the Arbitration Act, against the Final Award of the Arbitral Tribunal. Vide Judgment dated 9th May, 2023, the Hon''ble Delhi High Court upheld the Arbitration Award dated 24th July, 2018 in the Gas Migration dispute and dismissed GOI''s appeal.
(b) Arbitration was initiated by BG Exploration and Production India Limited and the Company (together the Claimants) against GOI on 16th December, 2010 under Production Sharing Contracts (''PSCs'') for Panna - Mukta and Tapti blocks due to difference in interpretation of certain PSC provisions between Claimants and GOI. The Arbitral Tribunal by majority issued a final partial award (''2016 FPA''), and separately, two dissenting opinions in the matter on 12th October, 2016. Claimants challenged certain parts of the 2016 FPA before the English Courts, which delivered its judgment on 16th April, 2018 and remitted one of the challenged issues back to the Arbitral Tribunal for reconsideration. The Arbitral Tribunal decided in favour of the Claimants in large part vide its final partial award dated 1st October, 2018 (''2018 FPA''). GOI and Claimants filed an appeal before the English Commercial Court against this 2018 FPA. The English Commercial Court rejected GOI''s challenges to 2018 FPA and upheld Claimants'' challenge in February 2020 and remitted the underlying issue in challenge back to the Arbitration Tribunal for determination. Tribunal gave favorable award on 29th January, 2021 ("EPOD Agreements Case Awardâ). Government challenged the EPOD Agreements Case Award before the English High Court which was dismissed on 9th June, 2022. Claimants have filed an application before the Arbitral Tribunal seeking increase in the PSC Cost Recovery Limits and the same is sub-judice. Arbitral Tribunal is yet to schedule the final re-computation of accounts and the quantification phase of the arbitration, which will take place post determination of Claimants'' request for increase in cost recovery limit under the PSCs.
GOI has also filed an execution petition before the Hon''ble Delhi High Court under sections 47 and 49 of the Arbitration and Conciliation Act, 1996 and Section 151 of the Civil Procedure Code, 1908 seeking enforcement and execution of the 2016 FPA, ignoring the judgments of English High Court and the subsequent Tribunal Awards. The Claimants contend that GOI''s Execution Petition is not maintainable. The hearing in Government''s Execution Petition before the Delhi High Court has concluded. Hon''ble Court ruled that Government of India''s execution petition seeking enforcement and execution of the Arbitration Tribunal''s Final Partial Award dated 12th October, 2016 ("2016 FPAâ) relating to disputes under Panna-Mukta and Tapti Production Sharing Contracts is not maintainable.
(c) NTPC filed suit in 2006 for specific performance of contract for supply of natural gas of 132 trillion BTU annually for
a period of 17 years. This suit is still pending adjudication in the Bombay High Court and the Company''s fact witnesses in the suit are to be cross examined by NTPC.
Considering the complexity of above issues, the Company is of the view that any attempt for quantification of possible exposure to the Company will have an effect of prejudicing Company''s legal position in the ongoing arbitration/ litigations. Moreover, the Company considers above demand/disputes as remote.
(III) The Income -Tax Assessments of the Company have been completed up to Assessment Year 2019-20. The total outstanding demand upto AY 2019-20 is C 356 crore as on date. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions of the Income tax Act, 1961, the company has been legally advised that the demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(IV) On December 16, 2010, the Securities and Exchange Board of India (SEBI) issued a show cause notice ("SCNâ) inter alia to the Company (RIL) in connection with the trades by RIL in the stock exchanges in 2007 in the shares of Reliance Petroleum Limited, then a subsidiary of RIL. Hearings were held before the Whole Time Member ("WTMâ) of SEBI in respect of the SCN. By an order dated March 24, 2017, the WTM passed the directions: (i) prohibiting inter alia RIL from dealing in equity derivatives in the ''Futures & Options'' segment of stock exchanges, directly or indirectly, for a period of one year from the date of the order; and
(ii) to RIL to disgorge an amount of C 447 crore along with interest at the rate of 12% per annum from November 29, 2007 till the date of payment. In May 2017, RIL and the other noticees filed an appeal before the Securities Appellate Tribunal ("SATâ) against this order. SAT, by a majority order (2:1), dismissed the appeal on November 5, 2020 and directed RIL to pay the disgorged amount within sixty days from the date of the order. The appeal of RIL and other noticees has been admitted by the Hon''ble Supreme Court of India. By its order dated December 17, 2020, the Hon''ble Supreme Court of India directed RIL to deposit C 250 crore in the Investors'' Protection Fund, subject to the final result of the appeal and stayed the recovery of the balance, inclusive of interest, pending the appeal. RIL has complied with the order dated December 17, 2020 of the Hon''ble Supreme Court of India.
In the very same matter, on November 21, 2017 SEBI issued show cause notice, inter alia, to RIL, asking RIL to show cause as to why inquiry should not be held in terms of SEBI (Procedure for Holding Inquiry and Imposing Penalties by Adjudicating Officer) Rules, 1995 and penalty not be imposed under the provisions of the Securities and Exchange Board of India Act, 1992. The Adjudicating Officer of SEBI passed an order on January 1, 2021 imposing a penalty of C 25 crore on RIL. RIL has paid the penalty under protest and has filed an appeal before the SAT against this order.
The Company adheres to a disciplined Capital Management framework in order to maintain a strong balance sheet. The main objectives are as follows:
a) Maintain AAA rating domestically and investment grade rating internationally.
b) Manage foreign exchange, interest rates and commodity price risk, and minimise the impact of market volatility on earnings.
c) Diversify sources of financing and spread the maturity across tenure buckets in order to manage liquidity risk.
d) Leverage optimally in order to maximise shareholder returns.
For current borrowings, the carrying amounts approximates fair value due to the short maturity of these instruments.
The financial instruments are categorised into three levels based on the inputs used to arrive at fair value
measurements as described below:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either
directly or indirectly; and
Level 3: Inputs based on unobservable market data.
All financial instruments are initially recognised and subsequently re-measured at fair value as described below:
a) The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills, Certificate of Deposit and Mutual Funds is measured at quoted price or NAV.
b) The fair value of Interest Rate Swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
c) The fair value of Forward Foreign Exchange contracts and Currency Swaps is determined using observable forward exchange rates and yield curves at the balance sheet date.
d) The fair value of over-the-counter Foreign Currency Option contracts is determined using the Black Scholes valuation model.
e) Commodity derivative contracts are valued using available information in markets and quotations from exchange, brokers and price index developers.
f) The fair value for level 3 instruments is valued using inputs based on information about market participants assumptions and other data that are available.
g) The fair value of the remaining financial instruments is determined using discounted cash flow analysis.
h) All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.
The company''s activities expose it to variety of financial risks: market risk, credit risk, interest rate risk and liquidity risk. Within the boundaries of approved Risk Management Policy framework, the Company uses derivative instruments to manage the volatility of financial markets and minimize the adverse impact on its financial performance.
i) Market Risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk.
a) Foreign Currency Risk
Foreign currency risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee.
The following table shows foreign currency exposures in US Dollar, Euro and Japanese Yen on financial instruments at the end of the reporting period. The exposure to all other foreign currencies are not material.
b) Interest Rate Risk
The Company is also exposed to interest rate risk, changes in interest rates will affect future cash flows or the fair values of its financial instruments, principally debt. The Company issues debt in a variety of currencies based on market opportunities and it uses derivatives to hedge interest rate exposures.
iv) Liquidity Risk
Liquidity risk arises from the Company''s inability to meet its cash flow commitments on the due date. The company maintains sufficient stock of cash, marketable securities and committed credit facilities. The company accesses global and local financial markets to meet its liquidity requirements. It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the company''s cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The company''s liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in a range of short-dated, secure and liquid instruments including short-term bank deposits, money market funds, reverse repos and similar instruments. The portfolio of these investments is diversified to avoid concentration risk in any one instrument or counterparty.
ii) Commodity Price Risk
Commodity price risk arises due to fluctuation in prices of crude oil, other feed stock and products. The company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.
The Company''s commodity risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company enters into various transactions using derivatives and uses over-the-counter as well as Exchange Traded Futures, Options and Swap contracts to hedge its commodity and freight exposure.
iii) Credit Risk
Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises from company''s activities in investments, dealing in derivatives and receivables from customers. The Company ensure that sales of products are made to customers with appropriate creditworthiness. Investment and other market exposures are managed against counterparty exposure limits. Credit information is regularly shared between businesses and finance function, with a framework in place to quickly identify and respond to cases of credit deterioration.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Credit risk is actively managed through Letters of Credit, Bank Guarantees, Parent Company Guarantees, advance payments and factoring & forfeiting without recourse to the company to avoid concentration of risk. The company restricts its fixed income investments to liquid securities carrying high credit rating.
The Company''s business objective includes safe-guarding its earnings against adverse price movements of crude oil and other feedstock, refined products, freight costs as well as foreign exchange and interest rates. The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value and Cash Flow hedges. Hedging instruments include exchange traded futures and options, over-the-counter swaps, forwards and options as well as non-derivative instruments to achieve this objective.
There is an economic relationship between the hedged items and the hedging instruments. The Company has established a hedge ratio of 1:1 for the hedging relationships. To test the hedge effectiveness, the Company uses the hypothetical derivative method and critical term matching method.
44.2 Scheme of arrangement between the Company and Reliance Syngas Limited (wholly-owned subsidiary):
Pursuant to the Scheme of Arrangement between the Company and its shareholders & creditors and Reliance Syngas Limited (a wholly-owned subsidiary of the Company) and its shareholders & creditors (the Scheme), sanctioned by the Hon''ble by National Company Law Tribunal, Mumbai bench and Ahmedabad bench, vide their orders dated March 30, 2022, the Company had transferred its gasification undertaking (Part of Oil to Chemicals Segment) to Reliance Syngas Limited, as a going concern on a slump sale basis, at carrying value as appearing in the books of the Company on the appointed date i.e. March 31, 2022, for a consideration of C 30,490 crore.
(ii) The Company has not advanced or loaned or invested funds to any other persons or entities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
(a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
(b) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(iii) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
(b) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(iv) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income-tax Act, 1961.
46. Events after the Reporting Period
The Board of Directors have recommended dividend of C 9/- per fully paid up equity share of C 10/- each for the financial year 2022-23.
47. The figures for the corresponding previous year have been regrouped / reclassified wherever necessary, to make them comparable.
48. Approval of Financial Statements
The financial statements were approved for issue by the Board of Directors on July 21, 2023.
Mar 31, 2022
14.7 Options granted under ESOS-2006 prior to withdrawal of scheme, continue to be governed by ESOS-2006. There are no options pending for vesting under ESOS - 2006. Pursuant to ''Reliance Industries Limited Employees'' Stock Option Scheme 2017'' (ESOS-20l7), 90,000 options have been granted to eligible employees during the year. Options granted and remaining to be vested as at the end of the year under ESOS-2017 is 3,90,000.
14.8 Rights, Preferences and Restrictions Attached to Shares:
The Company has only one class of equity shares having face value of '' 10 each. The holder of the equity share is entitled to dividend right and voting right in the same proportion as the capital paid-up on such equity share bears to the total paid-up equity share capital of the Company. The dividend proposed by Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company in the same proportion as the capital paid-up on the equity shares held by them bears to the total paid-up equity share capital of the Company.
14.9 Issue of Shares under Rights Issue:
The Company had, issued 42,26,26,894 equity shares of face value of '' 10/- each on right basis (''Rights Equity Shares'').
In accordance with the terms of issue, '' 314.25 i.e. 25% of the Issue Price per Rights Equity Share, was received from the concerned allottees on application and shares were allotted. The Board has made First call of '' 314.25 per Rights Equity Share (including a premium of '' 311.75 per share) in May, 2021 and Second and Final call of '' 628.50 per Rights Equity Share (including a premium of '' 623.50 per share) in November, 2021. As on March 31, 2022, an aggregate amount of '' 81 crore is unpaid.
21.1 Working Capital Loans from Banks of '' 3,579 crore (Previous Year '' 2,981 crore) are secured by hypothecation of present and future stock of raw materials, work-in-progress, finished goods, stores and spares (not relating to plant and machinery), book debts, outstanding monies, receivables, claims, bills, materials in transit, etc. save and except receivables of
Oil & Gas segment.
21.2 Refer note 38 B (iv) for maturity profile.
21.3 The Company has satisfied all the covenants prescribed in terms of borrowings.
For the year ended 31st March, 2022
a) i. The Company has recognised loss of '' 36,143 crore (net of deferred tax) in the Statement of Profit and Loss as Exceptional
Item on measurement of gasification undertaking as held for sale pursuant to Ind AS 105, which requires assets to be measured at lower of its carrying amount and fair value less costs to sell.
ii. Further, the Company has withdrawn from General Reserves, an amount of '' 36,143 crore equal to the loss recognised in the Statement of profit and loss, and credited the same to the Statement of Profit and Loss. This is in accordance with Scheme approved by Hon''ble National Company Law Tribunal, Mumbai bench and Ahmedabad bench, overriding the Indian Accounting Standards (Ind AS), (Refer Note 43.1).
For the year ended 31st March, 2021
b) Net gain on sale of investments and transfer of Petro Retail assets with respect to Reliance BP Mobility Limited of '' 4,420 crore (net of taxes of '' 1,508 crore).
c) Recognition of Reliance Holding USA, Inc.''s (RHUSA) loan and Merger pursuant to Scheme of Amalgamation:
The Company has recognised loss of '' 33,217 crore in the Statement of Profit and Loss due to take over of Reliance Holding USA, Inc. (RHUSA) loan, which was supported / guaranteed by the Company. Further, these loans were taken over by the Company subsequent to approval received from lenders of Reliance Holding USA Inc. and Reserve Bank of India.
Pursuant to the Composite Scheme of Amalgamation and Plan of Merger (the âSchemeâ) approved by the Hon''ble National Company Law Tribunal, Mumbai bench, vide order dated July 27, 2020, Reliance Holding USA Inc. (RHUSA) has merged with Reliance Energy Generation and Distribution Limited (REGDL) and REGDL has merged with the Company. In accordance with the provisions of the Scheme, the Company has withdrawn consequential amount of '' 33,217 crore from retained earnings to the Statement of Profit and Loss.
d) Due to the adverse changes in market environment, reduction in activity by operator and recent operational performance of the Shale Gas subsidiaries, the Company has impaired its investment in Shale Gas Subsidiaries to the extent of
'' 15,686 crore. This is in accordance with the requirements of Ind AS 36 -Impairment of Assets, as the carrying amount of investments exceed its recoverable amount. Further, the Company has also recognised Deferred Tax Assets of '' 15,570 crore in respect of the difference between the book base and tax base of the Shale Gas Operations, in accordance with Ind AS 12 - Income Taxes.
(c) NTPC had filed a suit for specific performance of a contract for supply of natural gas by RIL before the Hon''ble Bombay High Court. The main issue in dispute is whether a valid, concluded and binding contract exists between the parties for supply of Natural Gas of 132 Trillion BTU annually for a period of 17 years. The matter is presently sub judice and RIL is of the view that NTPC''s claim lacks merit and no binding contract for supply of gas was executed between NTPC and RIL.
Considering the complexity of above issues, the Company is of the view that any attempt for quantification of possible exposure to the Company will have an effect of prejudicing Company''s legal position in the ongoing arbitration/ litigations. Moreover, the Company considers above demand/disputes as remote.
The reserve estimates for producing fields are revised based on the performance of producing fields and with respect to discovered fields, the revision are based on the revised geological and reservoir simulation studies.
35.3 The Government of India (GOI), by its letters dated 2nd May, 2012, 14th November, 2013, 10th July, 2014 and 3rd June, 2016 has disallowed certain costs which the Production Sharing Contract (PSC), relating to Block KGDWN-98/3 entitles the Company to recover. The Company continues to maintain that the Contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the GOI to disallow the recovery of any Contract Cost as defined in the PSC. The Company referred the issue to arbitration with GOI for resolution of disputes. The demand from the GOI of $ 165 million ('' 1,248 crore) being the Company''s share (total demand $ 247 million- '' 1,872 crore) towards additional Profit Petroleum has been considered as contingent liability.
In supersession of Ministry''s Gazette Notification no. 22011/3/2012-ONG.D.V. dated 10th January, 2014, the GOI notified the New Domestic natural Gas Pricing Guidelines 2014, the GOI has directed the Company to instruct customers to deposit differential revenue on gas sales from D1D3 field on account of the prices determined under the above guidelines converted to NCV basis and the prevailing price prior to 1st November, 2014 ($ 4.205 per MMBTU) to be credited to the gas pool account maintained by GAIL (India) Limited. The amount so deposited by customer in Gas pool Account is '' 295 crore (net) as at 31st March, 2022 is disclosed under Other Non-Current Assets. Revenue has been recognised at the GOI notified prices in respect of gas quantities sold from D1D3 field from 1st November, 2014. This amount in the Gas Pool Account has also been challenged under cost recovery arbitration and is pending adjudication.
Tribunal has scheduled further procedural hearing in the matter.
35.4 (a) GOI sent a notice to the KG D6 Contractor on 4th November, 2016 asking the Contractor to deposit approximately US $1.55
billion on account of alleged gas migration from ONGC''s blocks. RIL, as Operator, for and on behalf of all constituents of the Contractor, initiated arbitration proceedings against the GOI. The Arbitral Tribunal vide its Final Award dated 24th July, 2018 upheld Contractor''s claims. GOI filed an Appeal under Section 34 of the Arbitration Act, against the Final Award of the Arbitral Tribunal on 15th November, 2018 before the Hon''ble Delhi High Court. The Appeal is currently being heard before the Hon''ble Delhi High Court.
(b) Arbitration was initiated by BG Exploration and Production India Limited and RIL (together the Claimants) against GOI on 16th December, 2010 under the PSCs for Panna - Mukta and Tapti blocks due to difference in interpretation of certain PSC provisions between Claimants and GOI. The Arbitral Tribunal by majority issued a final partial award (''2016 FPA''), and separately, two dissenting opinions in the matter on 12th October, 2016. Claimants challenged certain parts of the 2016 FPA before the English Courts, which delivered its judgment on 16th April, 2018 and remitted one of the challenged issues back to the Arbitral Tribunal for reconsideration. The Arbitral Tribunal decided in favour of the Claimants in large part vide its final partial award dated 1st October, 2018 (''2018 FPA''). GOI and Claimants filed an appeal before the English Commercial Court against this 2018 FPA. The English Commercial Court rejected GOI''s challenges to 2018 FPA and upheld Claimants'' challenge in February 2020 and remitted the underlying issue in challenge back to the Arbitration Tribunal for determination. On 29th January, 2021 the Tribunal issued a further final partial award on the remitted matter and GOI has challenged the same before the English Commercial Court. Claimants have filed an application before the Arbitral Tribunal seeking increase in the PSC Cost Recovery Limits and the same is sub-judice. Arbitral Tribunal is yet to schedule the final re-computation of accounts phase of the arbitration, which will take place post determination of Claimants'' request for increase in cost recovery limit under the PSCs.
GOI has also filed an execution petition before the Hon''ble Delhi High Court under sections 47 and 49 of the Arbitration and Conciliation Act, 1996 and Section 151 of the Civil Procedure Code, 1908 seeking enforcement and execution of the 2016 FPA, ignoring the judgments of English High Court and the subsequent Tribunal Awards. The Claimants contend that GOI''s Execution Petition is not maintainable. GOI''s Execution Petition is currently sub judice before Delhi High Court.
(III) The Income -Tax Assessments of the Company have been completed up to Assessment Year 2018-19. The total demand upto AY 2018-19 is '' 1,128 crore as on date. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions of the Income tax Act, 1961, the company has been legally advised that the demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(IV) On Decem ber 16, 2010, the Securities and Exchange Board of India (SEBI) issued a show cause notice (âSCNâ) inter alia to the Company (RIL) in connection with the trades by RIL in the stock exchanges in 2007 in the shares of Reliance Petroleum Limited, then a subsidiary of RIL. Hearings were held before the Whole Time Member (âWTMâ) of SEBI in respect of the SCN. By an order dated March 24, 2017, the WTM passed the directions: (i) prohibiting inter alia RIL from dealing in equity derivatives in the ''Futures & Options'' segment of stock exchanges, directly or indirectly, for a period of one year from the date of the order; and (ii) to RIL to disgorge an amount of '' 447 crore along with interest at the rate of 12% per annum from November 29, 2007 till the date of payment. In May 2017, RIL and the other noticees filed an appeal before the Securities Appellate Tribunal (âSATâ) against this order. SAT, by a majority order (2:1), dismissed the appeal on November 5, 2020 and directed RIL to pay the disgorged amount within sixty days from the date of the order. The appeal of RIL and other noticees has been admitted by the Hon''ble Supreme Court of India. By its order dated December 17, 2020, the Hon''ble Supreme Court of India directed RIL to deposit '' 250 crore in the Investors'' Protection Fund, subject to the final result of the appeal and stayed the recovery of the balance, inclusive of interest, pending the appeal. RIL has complied with the order dated December 17, 2020 of the Hon''ble Supreme Court of India.
The Company adheres to a disciplined Capital Management framework in order to maintain a strong balance sheet. The main objectives are as follows:
a) Maintain AAA rating domestically and investment grade rating internationally.
b) Manage foreign exchange, interest rates and commodity price risk, and minimise the impact of market volatility on earnings.
c) Diversify sources of financing and spread the maturity across tenure buckets in order to manage liquidity risk.
d) Leverage optimally in order to maximise shareholder returns.
For current borrowings, the carrying amounts approximates fair value due to the short maturity of these instruments.
The financial instruments are categorised into three levels based on the inputs used to arrive at fair value measurementsas described belowLevel 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly
or indirectly; and
Level 3: Inputs based on unobservable market data.
Valuation MethodologyAll financial instruments are initially recognised and subsequently re-measured at fair value as described below:
a) The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills, Certificate of Deposit and Mutual Funds is measured at quoted price or NAV.
b) The fair value of Interest Rate Swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
c) The fair value of Forward Foreign Exchange contracts and Currency Swaps is determined using observable forward exchange rates and yield curves at the balance sheet date.
d) The fair value of over-the-counter Foreign Currency Option contracts is determined using the Black Scholes valuation model.
e) Commodity derivative contracts are valued using available information in markets and quotations from exchange, brokers and price index developers.
f) The fair value for level 3 instruments is valued using inputs based on information about market participants assumptions and other data that are available.
g) The fair value of the remaining financial instruments is determined using discounted cash flow analysis.
h) All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.
The company''s activities expose it to variety of financial risks: market risk, credit risk, interest rate risk and liquidity risk. Within the boundaries of approved Risk Management Policy framework The Company uses derivative instruments to manage the volatility of financial markets and minimize the adverse impact on its financial performance.
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk.
Foreign currency risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee.
The following table shows foreign currency exposures in US Dollar, Euro and Japanese Yen on financial instruments at the end of the reporting period. The exposure to all other foreign currencies are not material.
b) Interest Rate Risk
The Company is also exposed to interest rate risk, changes in interest rates will affect future cash flows or the fair values of its financial instruments, principally debt. The Company issues debt in a variety of currencies based on market opportunities and it uses derivatives to hedge interest rate exposures.
Commodity price risk arises due to fluctuation in prices of crude oil, other feed stock and products. The company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.
The Company''s commodity risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company enters into various transactions using derivatives and uses over-the-counter as well as Exchange Traded Futures, Options and Swap contracts to hedge its commodity and freight exposure.
iii) Credit RiskCredit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises from company''s activities in investments, dealing in derivatives and receivables from customers. The Company ensure that sales of products are made to customers with appropriate creditworthiness. Investment and other market exposures are managed against counterparty exposure limits. Credit information is regularly shared between businesses and finance function, with a framework in place to quickly identify and respond to cases of credit deterioration.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Credit risk is actively managed through Letters of Credit, Bank Guarantees, Parent Company Guarantees, advance payments and factoring & forfaiting without recourse to the company to avoid concentration of risk. The company restricts its fixed income investments to liquid securities carrying high credit rating.
iv) Liquidity RiskLiquidity risk arises from the Company''s inability to meet its cash flow commitments on the due date. The company maintains sufficient stock of cash, marketable securities and committed credit facilities. The company accesses global and local financial markets to meet its liquidity requirements. It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the company''s cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The company''s liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in a range of short-dated, secure and liquid instruments including short-term bank deposits, money market funds, reverse repos and similar instruments. The portfolio of these investments is diversified to avoid concentration risk in any one instrument or counterparty.
The Company''s business objective includes safe-guarding its earnings against adverse price movements of crude oil and other feedstock, refined products, freight costs as well as foreign exchange and interest rates. The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value and Cash Flow hedges. Hedging instruments include exchange traded futures and options, over-the-counter swaps, forwards and options as well as non-derivative instruments to achieve this objective.
There is an economic relationship between the hedged items and the hedging instruments. The Company has established a hedge ratio of 1:1 for the hedging relationships. To test the hedge effectiveness, the Company uses the hypothetical derivative method and Dollar offset method.
The hedge ineffectiveness can arise from:
- Differences in the timing of the cash flows.
- Different indexes (and accordingly different curves).
- The counterparties'' credit risk differently impacting the fair value movements.
43. Significant Arrangements43.1 Scheme of arrangement between the Company and Reliance Syngas Limited (wholly-owned subsidiary):
Pursuant to the Scheme of Arrangement between the Company and its shareholders & creditors and Reliance Syngas Limited (a wholly-owned subsidiary of the Company) and its shareholders & creditors (the Scheme), approved by the Hon''ble by National Company Law Tribunal, Mumbai bench and Ahmedabad bench, vide their orders dated March 30, 2022, the Company has transferred its gasification undertaking (Part of Oil to Chemicals Segment) to Reliance Syngas Limited, as a going concern on a slump sale basis, at carrying value as appearing in the books of the Company on the appointed date i.e. March 31, 2022, for a consideration of '' 30,490 crore.
43.2 Scheme of arrangement between the Company and Reliance O2C Limited (wholly-owned subsidiary) :
During the year, the Company has withdrawn the petition pending before the National Company Law Tribunal (NCLT) seeking sanction of the scheme for transfer of O2C undertaking of the Company to Reliance O2C Limited, a wholly-owned subsidiary of the Company.
(ii) The Company has not advanced or loaned or invested funds to any other persons or entities, including foreign entities (Intermediaries) with the understanding that the Intermediary shall:
(a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (Ultimate Beneficiaries) or
(b) Provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.
(iii) The Company has not received any fund from any persons or entities, including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:
(a) Directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (Ultimate Beneficiaries) or
(b) Provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(iv) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income-tax Act, 1961.
45. Events after the Reporting Period
The Board of Directors have recommended dividend of '' 8 per fully paid up equity share of '' 10/- each for the financial year 2021-22.
46. The figures for the corresponding previous year have been regrouped / reclassified wherever necessary, to make them comparable.
47. Approval of Financial Statements
The financial statements were approved for issue by the Board of Directors on May 06, 2022.
Mar 31, 2021
Contingent Liabilities
Disclosure of contingent liability is made when there is a possible obligation arising from past events, the existence of which will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the Company or a present obligation that arises from past events where it is either not probable that an outflow of resources embodying economic benefits will be required to settle or a reliable estimate of amount cannot be made.
(l) Employee Benefits Expense Short-Term Employee Benefits
The undiscounted amount of short-term employee benefits expected to be paid in exchange for the services rendered by employees are recognised as an expense during the period when the employees render the services.
Post-Employment Benefits Defined Contribution Plans
The Company recognises contribution payable to the provident fund scheme as an expense, when an employee renders the related service.
If the contribution payable to the scheme for service received before the balance sheet date exceeds the contribution already paid, the deficit payable to the scheme is recognised as a liability. If the contribution already paid exceeds the contribution due for services received before the balance sheet date, then excess is recognised as an asset to the extent that the pre-payment will lead to a reduction in future payment or a cash refund.
The Company pays gratuity to the employees who have completed five years of service with the Company at the time of resignation/ superannuation. The gratuity is paid @15 days basic salary for every completed year of service as per the Payment of Gratuity Act, 1972. The gratuity liability amount is contributed to the approved gratuity fund formed exclusively for gratuity payment to the employees. The gratuity fund has been approved by respective Income Tax authorities. The liability in respect of gratuity and other post-employment benefits is calculated using the Projected Unit Credit Method and spread over the period during which the benefit is expected to be derived from employees'' services.
Remeasurement gains and losses arising from adjustments and changes in actuarial assumptions are recognised in the period in which they occur in Other Comprehensive Income.
Employee Separation Costs: The Company recognises the employee separation cost when the scheme is announced, and the Company is demonstrably committed to it.
The tax expenses for the period comprises of current tax and deferred income tax. Tax is recognised in Statement of Profit and Loss, except to the extent that it relates to items recognised in the Other Comprehensive Income. In which case, the tax is also recognised in Other Comprehensive Income.
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the Income Tax authorities, based on tax rates and laws that are enacted at the Balance sheet date.
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax assets are recognised to the extent it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax losses can be utilised. Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The carrying amount of Deferred tax liabilities and assets are reviewed at the end of each reporting period.
(n) Share Based Payments
Equity-settled share based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the grant date. Details regarding the determination of the fair value of equity-settled share based payments transactions are set out in Note 28.2.
The fair value determined at the grant date of the equity-settled share based payments is expensed on a straight-line basis over the vesting period, based on the Company''s estimate of equity instruments that will eventually vest, with a corresponding increase in equity. At the end of each reporting period, the Company revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in Statement of Profit and Loss such that the cumulative expenses reflects the revised estimate, with a corresponding adjustment to the Share Based Payments Reserve.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of diluted earnings per share.
In case of equity-settled share-based payment transactions, where the Company grants stock options to the employees of its subsidiaries, the transactions are accounted by increasing the cost of investment in subsidiary with a corresponding credit in the equity.
(o) Foreign Currencies Transactions and Translation
Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of transaction. Monetary assets and liabilities denominated in foreign currencies are translated at the functional currency closing rates of exchange at the reporting date. Exchange differences arising on settlement or translation of monetary items are recognised in Statement of Profit and Loss except to the extent of exchange differences which are regarded as an adjustment to interest costs on foreign currency borrowings that are directly attributable to the acquisition or construction of qualifying assets which are capitalised as cost of assets. Additionally, exchange gains or losses on foreign currency borrowings taken prior to April 1, 2016 which are related to the acquisition or construction of qualifying assets are adjusted in the carrying cost of such assets.
Non-monetary items that are measured in terms of historical cost in a foreign currency are recorded using the exchange rates at the date of the transaction. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was measured. The gain or loss arising on translation of non-monetary items measured at fair value is treated in line with the recognition of the gain or loss on the change in fair value of the item (i.e. translation differences on items whose fair value gain or loss is recognised in Other Comprehensive Income or Statement of Profit and Loss are also recognised in Other Comprehensive Income or Statement of Profit and Loss, respectively).
In case of an asset, expense or income where a non-monetary advance is paid/received, the date of transaction is the date on which the advance was initially recognised. If there were multiple payments or receipts in advance, multiple dates of transactions are determined for each payment or receipt of
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(p) Revenue Recognition
Revenue from contracts with customers is recognised when control of the goods or services are transferred to the customer at an amount that reflects the consideration entitled in exchange for those goods or services.
The Company is generally the principal as it typically controls the goods or services before transferring them to the customer.
Generally, control is transferred upon shipment of goods to the customer or when the goods is made available to the customer, provided transfer of title to the customer occurs and the Company has not retained any significant risks of ownership or future obligations with respect to the goods shipped.
Revenue from rendering of services is recognised over time by measuring the progress towards complete satisfaction of performance obligations at the reporting period.
Revenue is measured at the amount of consideration which the Company expects to be entitled to in exchange for transferring distinct goods or services to a customer as specified in the contract, excluding amounts collected on behalf of third parties (for example taxes and duties collected on behalf of the government). Consideration is generally due upon satisfaction of performance obligations and a receivable is recognised when it becomes unconditional. Generally, the credit period varies between 0-60 days from the shipment or delivery of goods or services as the case may be. The Company provides volume rebates to certain customers once the quantity of products purchased during the period exceeds a threshold specified and also accrues discounts to certain customers based on customary business practices which is derived on the basis of crude price volatility and various market demand - supply situations. Consideration are determined based on its most likely amount. Generally, sales of petroleum products contain provisional pricing features where revenue is initially recognised based on provisional price.
Difference between final settlement price and provisional price is recognised subsequently. The Company does not adjust short-term advances received from the customer for the effects of significant financing component if it is expected at the contract inception that the promised good or service will be transferred to the customer within a period of one year.
Contract Balances Trade Receivables
A receivable represents the Company''s right to an amount of consideration that
Contract Liabilities
A contract liability is the obligation to transfer goods or services to a customer for which the Company has received consideration (or an amount of consideration is due) from the customer. If a customer pays consideration before the Company transfers goods or services to the customer, a contract liability is recognised when the payment is made or the payment is due (whichever is earlier).
Contract liabilities are recognised as revenue when the Company performs under the contract.
Interest Income
Interest Income from a Financial Assets is recognised using effective interest rate method.
Dividend Income
Dividend Income is recognised when the Company''s right to receive the amount has been established.
(q) Financial Instruments i. Financial Assets
A. Initial Recognition and Measurement
All Financial Assets are initially recognised at fair value. Transaction costs that are directly attributable to the acquisition or issue of Financial Assets, which are not at Fair Value Through Profit or Loss, are adjusted to the fair value on initial recognition. Purchase and sale of Financial Assets are recognised using trade date accounting.
B. Subsequent Measurement
a) Financial Assets measured at Amortised Cost (AC)
A Financial Asset is measured at Amortised Cost if it is held within a business model whose objective is to hold the asset in order to collect contractual cash flows and the contractual terms of the Financial Asset give rise to cash flows on specified dates that represent solely payments of principal and interest on the principal amount outstanding.
b) Financial Assets measured at Fair Value Through Other Comprehensive Income (FVTOCI)
A Financial Asset is measured at FVTOCI if it is held within a business model whose objective is achieved by both collecting contractual cash flows and selling Financial Assets and the contractual terms of the Financial Asset give rise on specified dates to cash flows that represents solely payments of principal and interest on the principal amount outstanding.
c) Financial Assets measured at Fair Value Through Profit or Loss (FVTPL)
A Financial Asset which is not classified in any of the above categories are measured at FVTPL. Financial assets are reclassified subsequent to their recognition, if the Company changes its business model for managing those financial assets. Changes in business model are made and applied prospectively from the reclassification date which is the first day of immediately next reporting period following the changes in business model in accordance with principles laid down under Ind AS 109 -Financial Instruments.
C. Investment in Subsidiaries, Associates and Joint Ventures
The Company has accounted for its investments in Subsidiaries, associates and joint venture at cost less impairment loss (if any). The investments in preference shares with the right of surplus assets which are in nature of equity in accordance with Ind AS 32 are treated as separate category of investment and measured at FVTOCI.
D. Other Equity Investments
All other equity investments are measured at fair value, with value changes recognised in Statement of Profit and Loss, except for those equity investments for which the Company has elected to present the value changes in ''Other Comprehensive Income''. However, dividend on such equity investments are recognised in Statement of Profit and loss when the Company''s right to receive payment is established.
E. Impairment of Financial Assets
In accordance with Ind AS 109, the Company uses ''Expected Credit Loss''
(ECL) model, for evaluating impairment of Financial Assets other than those measured at Fair Value Through Profit and Loss (FVTPL).
Expected Credit Losses are measured through a loss allowance at an amount equal to:
⢠The 12-months expected credit losses (expected credit losses that result from those default events on the financial instrument that are possible within 12 months after the reporting date); or
⢠Full lifetime expected credit losses (expected credit losses that result from all possible default events over the life of the financial instrument).
For Trade Receivables the Company
expected lifetime losses to be recognised from initial recognition of the receivables.
The Company uses historical default rates to determine impairment loss on the portfolio of trade receivables. At every reporting date these historical default rates are reviewed and changes in the forwardlooking estimates are analysed.
For other assets, the Company uses 12 month ECL to provide for impairment loss where there is no significant increase in credit risk. If there is significant increase in credit risk full lifetime ECL is used.
A. Initial Recognition and Measurement
All Financial Liabilities are recognised at fair value and in case of borrowings, net of directly attributable cost. Fees of recurring nature are directly recognised in the Statement of Profit and Loss as finance cost.
B. Subsequent Measurement
Financial Liabilities are carried at amortised cost using the effective interest method.
For trade and other payables maturing within one year from the balance sheet date, the carrying amounts approximate fair value due to the short maturity of these instruments.
iii. Derivative Financial Instruments and Hedge Accounting
The Company uses various derivative financial instruments such as interest rate swaps, currency swaps, forwards & options and commodity contracts to mitigate the risk of changes in interest rates, exchange rates and commodity prices.
At the inception of a hedge relationship, the Company formally designates and documents the hedge relationship to which the Company wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge. Such derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and are also subsequently measured at fair value.
Derivatives are carried as Financial Assets when the fair value is positive and as Financial Liabilities when the fair value is negative. Any gains or losses arising from changes in the fair value of derivatives are taken directly to Statement of Profit and Loss, except for the effective portion of cash flow hedge which is recognised in Other Comprehensive Income and later to Statement of Profit and Loss when the hedged item affects profit or loss or is treated as basis adjustment if a hedged forecast transaction subsequently results in the recognition of a Non-Financial Assets or Non-Financial liability.
Hedges that meet the criteria for hedge accounting are accounted for as follows:
The Company designates derivative contracts or non-derivative Financial Assets/ Liabilities as hedging instruments to mitigate the risk of movement in interest rates and foreign exchange rates for foreign exchange exposure on highly probable future cash flows attributable to a recognised asset or liability or forecast cash transactions.
When a derivative is designated as a cash flow hedging instrument, the effective portion of changes in the fair value of the derivative is recognised in the cash flow hedging reserve being part of Other Comprehensive Income. Any ineffective portion of changes in the fair value of the derivative is recognised immediately in the Statement of Profit and Loss. If the hedging relationship no longer meets the criteria for hedge accounting, then hedge accounting is discontinued prospectively. If the hedging instrument expires or is sold or terminated or exercised, the cumulative gain or loss on the hedging instrument recognised in cash flow hedging reserve till the period the hedge was effective remains in cash flow hedging reserve until the underlying transaction occurs. The cumulative gain or loss previously recognised in the cash flow hedging reserve is transferred to the Statement of Profit and Loss upon the occurrence of the underlying transaction.
If the forecasted transaction is no longer expected to occur, then the amount accumulated in cash flow hedging reserve is reclassified in the Statement of Profit and Loss.
B. Fair Value Hedge
The Company designates derivative contracts or non-derivative Financial Assets/Liabilities as hedging instruments to mitigate the risk of change in fair value of hedged item due to movement in interest rates, foreign exchange rates and commodity prices.
Changes in the fair value of hedging instruments and hedged items that are designated and qualify as fair value hedges are recorded in the Statement of Profit and Loss. If the hedging relationship no longer
Reliance Industries Limited
meets the criteria for hedge accounting, the adjustment to the carrying amount of a hedged item for which the effective interest method is used is amortised to Statement of Profit and Loss over the period of maturity.
iv. Derecognition of Financial Instruments
The Company derecognises a Financial Asset when the contractual rights to the cash flows from the Financial Asset expire or it transfers the Financial Asset and the transfer qualifies for derecognition under Ind AS 109. A Financial liability (or a part of a Financial liability) is derecognised from the Company''s Balance Sheet when the obligation specified in the contract is discharged or cancelled or expires.
v. Offsetting
Financial Assets and Financial Liabilities are offset and the net amount is presented in the balance sheet when, and only when, the Company has a legally enforceable right to set off the amount and it intends, either to settle them on a net basis or to realise the asset and settle the liability simultaneously.
(r) Non-current Assets held for Sale
Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and sale is considered highly probable.
A sale is considered as highly probable when decision has been made to sell, assets are available for immediate sale in its present condition, assets are being actively marketed and sale has been agreed or is expected to be concluded within 12 months of the date of classification.
Non-current assets held for sale are neither depreciated nor amortised.
Assets and liabilities classified as held for sale are measured at the lower of their carrying amount and fair value less cost of sale and are presented separately in the Balance Sheet.
(s) Accounting for Oil and Gas Activity
The Company has adopted Successful Efforts Method (SEM) of accounting for its Oil and Gas activities. The policy of recognition of exploration and evaluation expenditure is considered in line with the principle of SEM. Seismic costs, geological and geophysical studies, petroleum exploration license fees and general and administration costs directly attributable to exploration and evaluation activities are expensed off. The costs incurred on acquisition of interest in oil and gas blocks and on exploration and evaluation other than
those which are expensed off are accounted for as Intangible Assets Under Development.
All development costs incurred in respect of proved reserves are also capitalised under Intangible Assets Under Development. Once a well is ready to commence commercial production, the costs accumulated in Intangible Assets Under Development are classified as Intangible Assets corresponding to proved developed oil and gas reserves. The exploration and evaluation expenditure which does not result in discovery of proved oil and gas reserves and all cost pertaining to production are charged to the Statement of Profit and Loss.
The Company uses technical estimation of reserves as per the Petroleum Resources Management System guidelines 2011 and standard geological and reservoir engineering methods. The reserve review and evaluation is carried out annually.
Oil and Gas Joint Ventures are in the nature of joint operations. Accordingly, assets and liabilities as well as income and expenditure are accounted on the basis of available information on a line-by-line basis with similar items in the Company''s Financial Statements, according to the participating interest of the Company.
(t) Earnings Per Share
Basic earnings per share is calculated by dividing the net profit after tax by the weighted average number of equity shares outstanding during the year adjusted for bonus element in equity share. Diluted earnings per share adjusts the figures used in determination of basic earnings per share to take into account the conversion of all dilutive potential equity shares. Dilutive potential equity shares are deemed converted as at the beginning of the period unless issued at a later date.
C. Critical Accounting Judgements and Key Sources of Estimation Uncertainty
The preparation of the Company''s Financial Statements requires management to make judgement, estimates and assumptions that affect the reported amount of revenue, expenses, assets and liabilities and the accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in next financial years.
(A) Estimation of Oil and Gas Reserves
The determination of the Company''s estimated oil and natural gas reserves requires significant judgements and estimates to be applied and these are regularly reviewed and updated. Factors such as the availability of geological and engineering data, reservoir performance data, acquisition and divestment activity, drilling of new wells, and
commodity prices all impact on the determination of the Company''s estimates of its oil and natural gas reserves. The Company bases it''s proved reserves estimates on the requirement of reasonable certainty with rigorous technical and commercial assessments based on conventional industry practice and regulatory requirements.
Estimates of oil and natural gas reserves are used to calculate depletion charges for the Company''s oil and gas properties. The impact of changes in estimated proved reserves is dealt with prospectively by amortising the remaining carrying value of the asset over the expected future production. Oil and natural gas reserves also have a direct impact on the assessment of the recoverability of asset carrying values reported in the Financial Statements.
Details on proved reserves and production both on product and geographical basis are provided in Note 34.1.
(B) Decommissioning Liabilities
The liability for decommissioning costs is recognised when the Company has an obligation to perform site restoration activity. The recognition and measurement of decommissioning provisions involves the use of estimates and assumptions. These include; the timing of abandonment of well and related facilities which would depend upon the ultimate life of the field, expected utilisation of assets by other fields, the scope of abandonment activity and pre-tax rate applied for discounting.
(C) Property Plant and Equipment/Intangible Assets
Estimates are involved in determining the cost attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by the management. Property, Plant and Equipment/Intangible Assets are depreciated/amortised over their estimated useful life, after taking into account estimated residual value. Management reviews the estimated useful life and residual values of the assets annually in order to determine the amount of depreciation/ amortisation to be recorded during any reporting period. The useful life and residual values are based on the Company''s historical experience with similar assets and take into account anticipated technological changes. The depreciation/amortisation for future periods is revised if there are significant changes from previous estimates.
(D) Recoverability of Trade Receivables
Judgements are required in assessing the recoverability of overdue trade receivables and determining whether a provision against those receivables is required. Factors considered include the credit rating of the counterparty, the amount and timing of anticipated future payments and any possible actions that can be taken to mitigate the risk
The timing of recognition and quantification of the liability (including litigations) requires the application of judgement to existing facts and circumstances, which can be subject to change. The carrying amounts of provisions and liabilities are reviewed regularly and revised to take account of changing facts and circumstances.
(F) Impairment of Financial and Non-Financial Assets
The impairment provisions for Financial Assets are based on assumptions about risk of default and expected cash loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on Company''s past history, existing market conditions as well as forward-looking estimates at the end of each reporting period.
In case of non-financial assets company estimates asset''s recoverable amount, which is higher of an asset''s or Cash Generating Units (CGU''s) fair value less costs of disposal and its value in use.
In assessing value in use, the estimated future cash flows are discounted to their present value using pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs of disposal, recent market transactions are taken into account, if no such transactions can be identified, an appropriate valuation model is used.
(G) Recognition of Deferred Tax Assets and Liabilities
Deferred tax assets and liabilities are recognised for deductible temporary differences and unused tax losses for which there is probability of utilisation against the future taxable profit. The Company uses judgement to determine the amount of deferred tax that can be recognised, based upon the likely timing and the level of future taxable profits and business developments.
For estimates relating to fair value of financial instruments refer note 37 of financial statements.
(I) Global Health Pandemic on COVID-19
The outbreak of corona virus (COVID-19) pandemic globally and in India is causing significant disturbance and slowdown of economic activity.
The Company''s operations and revenue during the period were impacted due to COVID-19. The Company has taken into account the possible impact of COVID-19 in preparation of financial statements, including its assessment of recoverable value of its assets based on internal and external information upto the date of approval of these financial statements and current indicators of future economic conditions.
1.1 Right-of-Use (Land) includes:
i) '' 83 crore (Previous Year '' 83 crore) in respect of which the letters of allotment are received and supplementary agreements entered, however, lease deeds are pending execution.
ii) '' 6,923 crore (Previous Year '' 6,923 crore) towards investment in preference shares representing right to hold and use all the immovable properties of the investee entity.
1.2 Buildings includes:
i) Cost of shares in Co-operative Societies '' 2,03,700 (Previous Year '' 2,03,700).
ii) '' 135 crore (Previous Year '' 135 crore) in shares of Companies / Societies with right to hold and use certain area of Buildings.
1.3 Intangible Assets - Others include: Jetties amounting to '' 812 crore (Previous Year '' 812 crore), the Ownership of which
vests with Gujarat Maritime Board.
1.4 Capital work-in-Progress and Intangible Assets Under Development includes:
i) '' 4,377 crore (Previous Year '' 2,348 crore) on account of Project Development Expenditure.
ii) '' 1,894 crore (Previous Year '' 1,669 crore) on account of cost of construction materials at site.
Mar 31, 2019
A. CORPORATE INFORMATION
Reliance Industries Limited (âthe Companyâ) is a listed entity incorporated in India. The registered office of the Company is located at 3rd Floor, Maker Chambers IV, 222, Nariman Point, Mumbai 400 021, India.
The Company is engaged in activities spanning across hydrocarbon exploration and production, petroleum refining and marketing, petrochemicals, retail and digital services.
1.1 LEASEHOLD LAND INCLUDES :
i) Leasehold Land includes Rs. 89 crore (Previous Year Rs. 778 crore) in respect of which the letters of allotment are received and supplementary agreements entered, however, lease deeds are pending execution.
ii) Rs. 6,923 crore (Previous Year Rs. 6,923 crore) towards investment in preference shares representing right to hold and use all the immovable properties of the investee entity.
1.2 BUILDINGS INCLUDES :
i) Cost of shares in Co-operative Societies Rs. 2,03,700 (Previous Year Rs. 2,02,700).
ii) Rs.135 crore (Previous Year Rs. 135 crore) in shares of Companies / Societies with right to hold and use certain area of Buildings.
1.3 Intangible Assets - Others include Jetties amounting to Rs. 812 crore (Previous Year Rs. 812 crore), the Ownership of which vests with Gujarat Maritime Board.
1.4 Capital Work-in-Progress and Intangible Assets Under Development includes :
i) Rs.21,823 crore (Previous Year Rs. 16,567 crore) on account of Project Development Expenditure.
ii) Rs.6,625 crore (Previous Year Rs. 7,551 crore) on account of cost of construction materials at site.
1.5 Additions in Property, Plant and Equipment, Capital Work-in-Progress, Intangible Assets and Intangible Assets Under Development includes Rs. 4,580 crore (net loss) [Previous Year Rs. 823 crore (net loss)] on account of exchange difference during the year.
1.6 For Assets pledged as security - Refer Note 15.1 .
1.7 Till year ended 31 March 2018, the estimated useful life of certain assets of plant and machinery were in range of 15-25 years with residual value of 5% of original cost. The management, based on internal and external technical evaluation, reassessed the estimates. Basis the technical evaluation made by the Management, the Company has revised the useful life of those assets in the range of 25 to 40 years and residual value to 15% of original cost effective from April 01, 2018.
The company has also evaluated certain assets and wherever necessary, has provided for accelerated depreciation in some of the assets.
2.1 The list of subsidiaries, joint ventures and associates along with proportion of ownership interest held and country of incorporation are disclosed in Note 35 and Note 36 of Consolidated Financial Statement.
2.2 As a part of Composite Scheme of Arrangement between Reliance Jio Infocomm Limited (RJIL), Jio Digital Fibre Private Limited (JDFPL) and Reliance Jio Infratel Private Limited (RJIPL) (âthe schemeâ) for demerger of optic fiber cable undertaking (âthe Undertakingâ) of RJIL, upon the scheme becoming effective on 31 March 2019, the Company, being shareholder of RJIL, has received Equity Shares and Optionally Convertible Preference Shares with surplus rights (âOCPSâ) of JDFPL. Pursuant to receipt of these Equity Shares and OCPS, the Company has allocated its cost of investments in RJIL into RJIL and JDFPL and elected to value its investment in OCPS at Fair value through Other Comprehensive Income (FVTOCI) and accordingly fair value gain of Rs. 77,158 crore on OCPS has been accounted in Other Comprehensive Income. Subsequently, Company sold its controlling equity stake in JDFPL to Digital FIbre Infrastructure Trust resulting into a total gain of Rs. 494 crore recognised in the statement of profit & loss. The remaining Equity investment in JDFPL has been measured at FVTPL and OCPS continued to be measured at FVTOCI. The Company has no control or significant influence over JDFPL post the sale of controlling stake.
2.3 Options granted under ESOS-2006 prior to withdrawal of scheme, continue to be governed by ESOS-2006. The Members approved a new scheme viz. âReliance Industries Limited Employeesâ Stock Option Scheme 2017â (ESOS-2017) with a limit to grant 6,33,19,568 options. This ceiling will be adjusted for any future bonus issue of shares or stock splits or consolidation of shares and also may further be adjusted at the discretion of the Board of Directors for any corporate action (s). The Company has not granted any options under ESOS-2017.
2.4 RIGHTS, PREFERENCES AND RESTRICTIONS ATTACHED TO SHARES:
The Company has only one class of equity shares having par value of Rs. 10 each and the holder of the equity share is entitled to one vote per share. The dividend proposed by board of directors is subject to approval of the shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation of the company, the holders of equity shares will be entitled to receive the remaining assets of the Company in proportion to the number of equity shares held.
3.1 SECURED NON-CONVERTIBLE DEBENTURES REFERRED ABOVE TO THE EXTENT OF:
a) Rs.500 crore (Previous Year Rs. 500 crore) are secured by way of first mortgage / charge on the immovable properties situated at Jamnagar Complex (SEZ unit) of the Company.
b) Rs. Nil (Previous year Rs. 370 crore) are secured by way of first mortgage / charge on the immovable properties situated at Hazira Complex and at Jamnagar Complex (other than SEZ unit) of the Company.
c) Rs.Nil (Previous year Rs. 133 crore ) are secured by way of first mortgage / charge on all the properties situated at Hazira Complex and at Patalganga Complex of the Company.
4.1 Working Capital Loans from Banks of Rs. 8,603 crore (Previous Year Rs. 1,653 crore) are secured by Government Securities (Refer Note 6) and hypothecation of present and future stock of raw materials, work-in-progress, finished goods, stores and spares (not relating to plant and machinery), book debts, outstanding monies, receivables, claims, bills, materials in transit, etc. save and except receivables of Oil and Gas Segment.
4.2 Working Capital Loans from Others of Rs. 6,128 crore (Previous Year â Nil) are secured by Government Securities and Bonds (Refer Note 2 and 6)
4.3 Refer note 35 B (iv) for maturity profile.
4.4 The Company has satisfied all the covenants prescribed in terms of borrowings.
The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.
The Expected Rate of Return on Plan Assets is determined considering several applicable factors, mainly the composition of Plan Assets held, assessed risks, historical results of return on Plan Assets and the Companyâs policy for Plan Assets Management.
VII) The expected contributions for Defined Benefit Plan for the next financial year will be in line with FY 2018-19.
5.1 The Company had announced Voluntary Separation Scheme (VSS) for the employees of Patalganga Manufacturing Division in the previous year. A sum of Rs. 1 crore had been paid during the previous year and debited to the Statement of Profit and Loss under the head âEmployee Benefits Expenseâ.
5.2 SHARE BASED PAYMENTS
a) Scheme Details
The Company has Employee Stock Option Scheme (ESOS -2006) under which majority of the options have been granted at the exercise price of Rs. 321 (face value Rs. 10 each) to be vested from time to time on the basis of performance and other eligibility criteria.
c) Fair Value on the grant date
The fair value on the grant date is determined using âBlack Scholes Modelâ, which takes into account exercise price, term of the option, share price at grant date and expected price volatility of the underlying shares, expected dividend yield and risk free interest rate for the term of the option.
The model inputs for options granted during the year ended 31st March, 2017 included as mentioned below. Further, no new stock options were granted during FY 2018-19;
a) Weighted average exercise price Rs.1,096
b) Grant date: 05.10.2016 & 10.10.2016
c) Vesting year: 2017-18 to 2020-21
d) Share Price at grant date: Rs. 1,089 at 05.10.2016 & Rs.1,096 at 10.10.2016
e) Expected price volatility of Companyâs share: 25.1% to 26.5%
f) Expected dividend yield: 1.07%
g) Risk free interest rate: 7 %
The expected price volatility is based on the historic volatility (based on remaining life of the options).
5.3 CORPORATE SOCIAL RESPONSIBILITY (CSR)
(a) CSR amount required to be spent as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof by the Company during the year is Rs. 811 crore (Previous Year Rs. 703 crore).
(b) Expenditure related to Corporate Social Responsibility is Rs.849 crore (Previous Year Rs. 745 crore).
(c) Out of note (b) above, Rs. 289 crore (Previous Year Rs. 672 crore) contributed to Reliance Foundation, Rs. 41 crore (Previous Year Rs. 38 crore) to Reliance Foundation Youth Sports and Rs. 476 crore (Previous Year Rs. 1 crore) to Reliance Foundation Institution of Education and Research which are related parties.
The reserve estimates for producing fields are revised based on the performance of producing fields and with respect to discovered fields, the revision are based on the revised geological and reservoir simulation studies.
5.4 The Government of India (GOI), by its letters dated 2nd May, 2012, 14th November, 2013, 10th July, 2014 and 3rd June, 2016 has communicated that it proposes to disallow certain costs which the Production Sharing Contract (âPSCâ), relating to Block KGDWN-98/3 entitles the Company to recover. Based on legal advice received, the Company continues to maintain that a Contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the Government to disallow the recovery of any Contract Cost as defined in the PSC. The Company has already referred the issue to arbitration and communicated the same to GOI for resolution of disputes. Pending decision of the arbitration, the demand from the GOI of $ 148 million (Rs. 1,024 crore) being the Companyâs share [total demand $ 247 million (Rs. 1,707 crore)] towards additional Profit Petroleum has been considered as contingent liability.
5.5 (a) The Government has made a claim of about $ 1.55 billion against the KGD6 Contractor parties in respect of gas said to have migrated from neighbouring blocks. In carrying out petroleum operations, the Contractor has worked within the boundaries of the block awarded to it and has complied with all applicable regulations and provisions of the Production Sharing Contract (âPSCâ). The Company has invoked the dispute resolution mechanism in the PSC and issued a Notice of Arbitration to the Government on 11th November, 2016.
The international arbitration panel has issued an award in favour of the Company, BP Exploration (Alpha) Limited âBPâ & Niko (NECO) Limited âNikoâ (Consortium) rejecting completely the claims of the Government of India against the Consortium in respect of migrated gas, by a majority of 2 to 1 with two eminent international jurists deciding in favour. All the contentions of the Consortium have been upheld by the majority with a finding that the Consortium was entitled to produce all gas from its contract area. All claims made by the Government of India in respect of migrated gas have been rejected and the consortium is not liable to pay any amount to the Government of India. During the year, Government of India has filed appeal in Delhi High Court.
(b) In supersession of the Ministryâs Gazette notification no. 22011/3/2012-ONG.D.V. dated 10th January, 2014, the GOI notified the New Domestic Natural Gas Pricing Guidelines, 2014, on 26th October 2014. Consequent to the aforesaid dispute referred to under 32.3 above which has been referred to arbitration, the GOI has directed the Company to instruct customers to deposit differential revenue on gas sales from D1D3 field on account of the prices determined under the above guidelines converted to NCV basis and the prevailing price prior to 1st November 2014 ($ 4.205 per MMBTU) to be credited to the gas pool account maintained by GAIL (India) Limited. The amount so deposited by customer to Gas Pool Account is Rs. 295 crore (net) (Refer Note 4) as at 31st March 2019 is disclosed under Other Non-Current Assets. Revenue has been recognised at the GoI notified prices in respect of gas quantities sold from D1D3 field from 1st November 2014.
(c) In December 2010, the Company and BG Exploration and Production India Limited (together, the âClaimantsâ) referred a number of disputes, differences and claims arising under two Production Sharing Contracts entered into in 1994 among the Claimants, Oil and Natural Gas Corporation Limited (ONGC) and the Government (the âPSCsâ) to arbitration. The disputes relate to, among other matters, the limits of cost recovery, profit sharing and audit and accounting provisions of the PSCs. the Arbitration Tribunal by majority issued a final partial award (âFPAâ), and separately, two dissenting opinions in the matter on 12 October, 2016.
Claimants have challenged certain parts of the FPA before the English Court. English Court had remitted Claimantsâ (Shell-RIL) case, that there was agreement between GOI and Contractor at Management Committee level that certain costs will be fully recoverable, to the Tribunal for reconsideration by 2 October 2018. Tribunal has delivered its Final Partial Award on 1 October 2018 and has provided its unanimous final partial award which is favourable to the Claimants. During the year, Government of India has filed an appeal before the English Courts against the Tribunalâs award.
(d) NTPC had filed a suit for specific performance of a contract for supply of natural gas by the Company before the Honâble Bombay High Court. The main issue in dispute is whether a valid, concluded and binding contract exists between the parties for supply of Natural Gas of 132 Trillion BTU annually for a period of 17 years. The matter is presently sub judice and the Company is of the view that NTPCâs claim lacks merit and no binding contract for supply of gas was executed between NTPC and the Company.
(e) Due to Nikoâs failure to pay the cash calls issued by the Company as Operator of KG D6 Block pursuant to the terms of the Joint Operating Agreement (âJOAâ), the Company and BP issued a Notice of Withdrawal to Niko in terms of the JOA requiring Niko to withdraw from the KG D6 PSC and JOA. Thereafter, Niko has initiated arbitration proceedings against the Company and BP on 19 December 2018 and the arbitration tribunal has been constituted and proceedings are yet to commence. Pending completion of assignment of PI of NIKO (6.67%) to the Company, net payments made on behalf of Niko (i.e. 6.67%) since the date of default notice is classified as Receivable in the books of accounts.
(f) Considering the complexity of above issues, the Company is of the view that any attempt for quantification of possible exposure to the Company will have an effect of prejudicing Companyâs legal position in the ongoing arbitration/litigations.
5.6 EXPLORATION FOR AND EVALUATION OF OIL AND GAS RESOURCES
The following financial information represents the amounts included in Intangible Assets Under Development relating to activity associated with the exploration for and evaluation of oil and gas resources.
(III) The Income -Tax Assessments of the Company have been completed up to Assessment Year 2016-17. The total outstanding demand upto AY 2016-17 is Rs. 28.08 crore as on date. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions of the Income tax Act, the company has been legally advised that the additional demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(IV) The Securities and Exchange Board of India had passed an Order under section 11B of the Securities and Exchange Board of India Act, 1992 on March 24, 2017 on a Show Cause notice dated December 16, 2010 issued to the Company in the matter concerning trading in the shares of Reliance Petroleum Limited by the Company in the year 2007, directing (i) disgorgement of Rs. 447 crore along with interest calculated at 12% per annum from November 29, 2007 till date of payment and (ii) prohibiting the Company from dealing in equity derivatives in the Futures and Options segment of the stock exchanges, directly or indirectly for a period of one year from March 24, 2017. The Company has filed an appeal against the said Order before the Honâble Securities Appellate Tribunal (âSATâ). SAT has stayed the direction on disgorgement till the next date of hearing and the prohibition from dealing in equity derivatives in the Futures and Options segment expired on March 23, 2018.
6. CAPITAL MANAGEMENT
The Company adheres to a Disciplined Capital Management framework, the pillars of which are as follows:
a) Maintain diversity of sources of financing and spreading the maturity across tenure buckets in order to minimise liquidity risk.
b) Maintain AAA rating domestically and investment grade rating internationally by ensuring that the financial strength of the Balance Sheet is preserved.
c) Manage financial market risks arising from foreign exchange, interest rates and commodity prices, and minimise the impact of market volatility on earnings.
d) Leverage optimally in order to maximise shareholder returns while maintaining strength and flexibility of Balance Sheet.
This framework is adjusted based on underlying macroeconomic factors affecting business environment, financial market conditions and interest rates environment.
The financial instruments are categorised into three levels based on the inputs used to arrive at fair value measurements as described below:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and
Level 3: Inputs based on unobservable market data.
Valuation Methodology
All financial instruments are initially recognised and subsequently re-measured at fair value as described below:
a) The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills, Certificate of Deposits and Mutual Funds is measured at quoted price or NAV.
b) The fair value of Interest Rate Swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
c) The fair value of Forward Foreign Exchange contracts and Currency Swaps is determined using observable forward exchange rates and yield curves at the balance sheet date.
d) The fair value of over-the-counter Foreign Currency Option contracts is determined using the Black Scholes valuation model.
e) Commodity derivative contracts are valued using available information in markets and quotations from exchange, brokers and price index developers.
f) The fair value for level 3 instruments is valued using inputs based on information about market participants assumptions and other data that are available.
g) The fair value of the remaining financial instruments is determined using discounted cash flow analysis.
h) All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.
B. FINANCIAL RISK MANAGEMENT
The companyâs activities expose it to variety of financial risks: market risk, credit risk, interest rate risk and liquidity risk.
The Company endeavors to use derivative instruments to manage the volatility of financial markets and minimise the adverse impact on its financial performance. All such activities are undertaken within an approved Risk Management Policy framework.
i) Market Risk
a) Foreign Currency Risk
Foreign Currency Risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee.
ii) Commodity Price Risk
Commodity price risk arises due to fluctuation in prices of crude oil, other feed stock and products. The company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.
The companyâs commodity price risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company enters into various transactions using derivatives and uses over-the-counter as well as Exchange Traded Futures, Options and Swap contracts to hedge its commodity and freight exposure.
iii) Credit Risk
Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises from companyâs activities in investments, dealing in derivatives and receivables from customers. The Company ensures that sales of products are made to customers with appropriate creditworthiness. Investment and other market exposures are managed against counterparty exposure limits.
Credit information is regularly shared between businesses and finance function, with a framework in place to quickly identify and respond to cases of credit deterioration.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Credit risk is actively managed through Letters of Credit, Bank Guarantees, Parent Company Guarantees, advance payments and factoring & forfaiting without recourse to the Company. The company restricts its fixed income investments in liquid securities carrying high credit rating.
iv) Liquidity Risk
Liquidity risk arises from the Companyâs inability to meet its cash flow commitments on the due date. The company maintains sufficient stock of cash, marketable securities and committed credit facilities. The company accesses global and local financial markets to meet its liquidity requirements. It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the companyâs cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The companyâs liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in a range of short-dated, secure and liquid instruments including short-term bank deposits, money market funds, reverse repos and similar instruments. The portfolio of these investments is diversified to avoid concentration risk in any one instrument or counterparty.
C. RECLASSIFICATION
The Company has reclassified certain non-derivative financial assets on 1st day of July 2018 from fair value through profit and loss (FVTPL) to financial assets at fair value through other comprehensive income (FVTOCI) on account of its business model change.
Cost and Fair value of reclassified assets as on reporting date is Rs. 18,722 crore and Rs. 20,059 crore respectively. Effective interest rate is 7.54% per annum. Interest revenue recognised during the period Rs. 1,060 crore Change in fair value gain/(loss) of Rs. 277 crore that would have been recognised in profit and loss during the reporting period if the financial assets had not been reclassified.
Refer Note 2 and 6.
D. HEDGE ACCOUNTING
The Companyâs business objective includes safe-guarding its earnings against adverse price movements of crude oil and other feedstock, refined products, freight costs as well as foreign exchange and interest rates. Reliance has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value and Cash Flow hedges. Hedging instruments include exchange traded futures and options, over-the-counter swaps, forwards and options as well as non-derivative instruments to achieve this objective. The table below shows the position of hedging instruments and hedged items as on the balance sheet date.
7. DETAILS OF LOANS GIVEN, INVESTMENTS MADE AND GUARANTEE GIVEN COVERED U/S 186 (4) OF THE COMPANIES ACT, 2013.
Loans given and Investments made are given under the respective heads.
8. EVENTS AFTER THE REPORTING PERIOD
The Board of Directors have recommended dividend of Rs. 6.5 per fully paid up equity share of Rs. 10/- each, aggregating Rs. 4,641 crore, including Rs. 789 crore dividend distribution tax for the financial year 2018-19, which is based on relevant share capital as on 31st March, 2019. The actual dividend amount will be dependent on the relevant share capital outstanding as on the record date / book closure.
9. The figures for the corresponding previous year have been regrouped / reclassified wherever necessary, to make them comparable.
10. APPROVAL OF FINANCIAL STATEMENTS
The Financial Statements were approved for issue by the Board of Directors on April 18, 2019.
Mar 31, 2018
1.    Leasehold Land includes :
i) Â Â Â Leasehold Land includes Rs, 778 crore (Previous Year Rs, 778 crore) in respect of which the letters of allotment are received and supplementary agreements entered, however, lease deeds are pending execution.
ii) Â Â Â Rs, 6,923 crore (Previous Year Rs, 6,923 crore) towards investment in preference shares representing right to hold and use all the immovable properties of the investee entity.
2.    Buildings includes :
i) Â Â Â Cost of shares in Co-operative Societies Rs, 2,02,700 (Previous Year Rs, 2,00,200).
ii) Â Â Â Rs, 135 crore (Previous Year Rs, 135 crore) in shares of Companies / Societies with right to hold and use certain area of Buildings.
3.    Intangible Assets - Others include Jetties amounting to Rs, 812 crore (Previous Year Rs, 812 crore), the Ownership of which vests with Gujarat Maritime Board.
4.    Capital Work-in-Progress and Intangible Assets Under Development includes :
i) Â Â Â Rs, 16,567 crore (Previous Year Rs, 15,544 crore) on account of Project Development Expenditure.
ii) Â Â Â Rs, 7,551 crore (Previous Year Rs, 11,526 crore) on account of cost of construction materials at site.
5.    Additions in Property, Plant and Equipment, Capital Work-in-Progress, Intangible Assets and Intangible Assets Under Development includes Rs, 823 crore (net loss) [Previous Year Rs, 2,166 crore (net loss)] on account of exchange difference during the year.
6.    For Assets pledged as security - Refer Note 15.1 .
7. During the year, the Company has not granted any options (Previous year 74,454 options) under ESOS-2006 scheme and the said scheme has been withdrawn. The Members approved a new scheme viz. Rs,Reliance Industries Limited EmployeesRs, Stock Option Scheme 2017' (ESOS-2017) with a limit to grant 6,33,19,568 options. This ceiling will be adjusted for any future bonus issue of shares or stock splits or consolidation of shares and also may further be adjusted at the discretion of the Board of Directors for any corporate action (s). The Company has not granted any options under ESOS-2017.
8. Rights, preferences and restrictions attached to shares:
The Company has only one class of equity shares having par value of Rs, 10 each and the holder of the equity share is entitled to one vote per share. The dividend proposed by Board of Directors is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the Company in proportion to the number of equity shares held.
9. Secured Non Convertible Debentures referred above to the extent of:
a) Â Â Â Rs, 370 crore (Previous year Rs, 370 crore) are secured by way of first mortgage / charge on the immovable properties situated at Hazira Complex and at Jamnagar Complex (other than SEZ unit) of the Company.
b) Â Â Â Rs, 133 crore (Previous year Rs, 266 crore) are secured by way of first mortgage / charge on all the properties situated at Hazira Complex and at Patalganga Complex of the Company.
c) Â Â Â Rs, 500 crore (Previous year Rs, 500 crore) are secured by way of first mortgage / charge on the immovable properties situated at Jamnagar Complex (SEZ unit) of the Company.
The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.
The Expected Rate of Return on Plan Assets is determined considering several applicable factors, mainly the composition of Plan Assets held, assessed risks, historical results of return on Plan Assets and the Company's policy for Plan Assets Management.
VII)Â The expected contributions for Defined Benefit Plan for the next financial year will be in line with FY 2017-18.
These plans typically expose the Company to actuarial risks such as: Investment Risk, Interest Risk,
Longevity Risk and Salary Risk.
Investment The present value of the defined benefit plan liability is calculated using a discount rate which is Risk    determined by reference to market yields at the end of the reporting period on government bonds.
Interest A decrease in the bond interest rate will increase the plan liability; however, this will be partially offset Risk    by an increase in the return on the plan debt investments.
Longevity The present value of the defined benefit plan liability is calculated by reference to the best estimate Risk    of the mortality of plan participants both during and after their employment. An increase in the life
expectancy of the plan participants will increase the plan's liability.
Salary    The present value of the defined plan liability is calculated by reference to the future salaries of plan
Risk    participants. As such, an increase in the salary of the plan participants will increase the plan's liability.
10. The Company had announced Voluntary Separation Scheme (VSS) for the employees of Patalganga Manufacturing Division. A sum of ' 1 crore (Previous Year ' Nil) has been paid during the year and debited to the Statement of Profit and Loss under the head "Employee Benefits Expenseâ.
* Â Â Â Stock options post bonus issue, range of exercise price and range of fair value at grant date have been proportionately adjusted to give the impact of bonus issue in the ratio of 1:1 made by the Company during FY 2017-18.
# Â Â Â Includes options exercised, expired / lapsed upto 31st March, 2018 i.e. 7,78,232. Accordingly balance of outstanding options granted as on 31st March, 2018 is 7,86,812.
Exercise period will expire not later than five years from the date of vesting of options or such other period as may be decided by the Human Resources, Nomination and Remuneration Committee, of the Board.
c) Fair Value on the grant date
The fair value on the grant date is determined using "Black Scholes Model", which takes into account exercise price, term of the option, share price at grant date and expected price volatility of the underlying shares, expected dividend yield and risk free interest rate for the term of the option.
The model inputs for options granted during the previous year ended 31st March, 2017 included as mentioned below. Further, no new stock options were granted during FY 2017-18;
a) Â Â Â Weighted average exercise price '1,096
b) Â Â Â Grant date: 05.10.2016 &Â 10.10.2016
c) Â Â Â Vesting year: 2017-18 to 2020-21
d) Â Â Â Share Price at grant date: ' 1,089 at 05.10.2016 &Â ' 1,096 at 10.10.2016
e) Â Â Â Expected price volatility of Company's share: 25.1% to 26.5%
f) Â Â Â Expected dividend yield: 1.07%
g) Â Â Â Risk free interest rate: 7 %
The expected price volatility is based on the historic volatility (based on remaining life of the options). Certification and consultation fees primarily includes certification fees paid to auditors. Statute and regulation permit auditors to certify export / import documentation, quarterly filings, XBRL filings, transfer pricing and bond issuances among others.
11. Corporate Social Responsibility (CSR)
(a) Â Â Â CSR amount required to be spent as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof by the Company during the year is Rs, 703 crore (Previous Year Rs, 620 crore)
(b) Â Â Â Expenditure related to Corporate Social Responsibility is Rs, 745 crore (Previous Year Rs, 659 crore).
(c) Â Â Â Out of note (b) above, Rs, 672 crore (Previous Year Rs, 557 crore) is spent through Reliance Foundation, Rs, 38 crore (Previous Year Rs, 22 crore) is spent through Reliance Foundation Youth Sports and Rs, 1 crore spent through Reliance Foundation Institution of Education and Research which are related parties.
(d) Â Â Â Out of note (b) above, Rs, Nil (Previous Year Rs, 5 crore) is towards construction / acquisition of an asset that will be owned by the Company.
12. RELATED PARTIES DISCLOSURES
As per Ind AS 24, the disclosures of transactions with the Related Parties are given below: (i) Â Â Â List of Related Parties where control exists and also other Related Parties with whom transactions have taken place and relationships:
Sr.
Name of the Related Party    Relationship
No.
1    Aanant Commercial Private Limited A
2 Â Â Â Adventure Marketing Private Limited#
3 Â Â Â AETN18 Media Private Limited#
4 Â Â Â Affinity Names Inc.
5    Aurora Algae Pty Limited A
6 Â Â Â Aurora Algae RGV LLCÂ A
7 Â Â Â Aurora Algae Inc.
8 Â Â Â Capital18 Fincap Private Limited#
9 Â Â Â Central Park Enterprises DMCCA
10    Cluster Commercials Private Limited A
11 Â Â Â Colorful Media Private Limited#
12 Â Â Â Colosceum Media Private Limited#
13 Â Â Â Delta Corp East Africa Limited a
14 Â Â Â Devashree Commercials Private Limited a
15 Â Â Â Digital18 Media Limited#
16 Â Â Â Dignity Mercantile Private Limited a
17 Â Â Â Dreketi S.A. a
18 Â Â Â E-18 Limited#
19 Â Â Â e-Eighteen.com Limited#
20 Â Â Â Equator Trading Enterprises Private Limited#
21 Â Â Â Ethane Crystal LLC
22 Â Â Â Ethane Emerald LLC Â Â Â _ , ...
Subsidiary
23 Â Â Â Ethane Opal LLC
24 Â Â Â Ethane Pearl LLC
25 Â Â Â Ethane Sapphire LLC
26 Â Â Â Ethane Topaz LLC
27 Â Â Â Girisha Commercials Private Limited a
28 Â Â Â Greycells18 Media Limited#
29 Â Â Â Ibn18 (Mauritius) Limited#
30 Â Â Â IndiaCast Media Distribution Private Limited #Â A
31 Â Â Â IndiaCast UK Limited# a
32 Â Â Â IndiaCast US Limited# a
33 Â Â Â Indiawin Sports Private Limited
34 Â Â Â Infomedia Press Limited#
35 Â Â Â Jalaja Commericals Private Limited a
36 Â Â Â Jio Information Solutions Limited (Formerly Reliance Textiles Limited)
37 Â Â Â Kanhatech Solutions Limited
38 Â Â Â Model Economic Township Limited
39 Â Â Â Moneycontrol Dot Com India Limited#
40 Â Â Â Naroda Power Private Limited a
41 Â Â Â Network18 Holdings Limited#
42 Â Â Â Network18 Media &Â Investments Limited#
43 Â Â Â NW18 HSN Holding PLC# a
44 Â Â Â Panorama Television Private Limited#
# Control by Independent Media Trust ofwhich RIL is the sole beneficiary
a The above entities includes related parties where the relationship existed for the part of the year
45 Â Â Â RB Holdings Private Limited#
46 Â Â Â RB Media Holdings Private Limited#
47 Â Â Â RB Mediasoft Private Limited#
48 Â Â Â Recron (Malaysia) Sdn. Bhd.
49 Â Â Â Reed Infomedia India Private Limited#
50    Reliance Aerospace Technologies Limited A
51 Â Â Â Reliance Ambit Trade Private Limited
52 Â Â Â Reliance Aromatics and Petrochemicals Limited
53 Â Â Â Reliance Brands Limited
54 Â Â Â Reliance Chemicals Limited
55 Â Â Â Reliance Clothing India Private Limited
56 Â Â Â Reliance Commercial Dealers Limited
57    Reliance Commercial Land & Infrastructure Limited A
58    Reliance Commercial Trading Private Limited A
59 Â Â Â Reliance Comtrade Private Limited
60    Reliance Content Distribution Limited A
61 Â Â Â Reliance Corporate IT Park Limited
62    Reliance Digital Media Distribution Limited A
63 Â Â Â Reliance Eagleford Midstream LLC a
64 Â Â Â Reliance Eagleford Upstream GP LLC
65 Â Â Â Reliance Eagleford Upstream Holding LP
66 Â Â Â Reliance Eagleford Upstream LLC
67 Â Â Â Reliance Eminent Trading &Â Commercial Private Limited
68 Â Â Â Reliance Energy and Project Development Limited
69 Â Â Â Reliance Energy Generation and Distribution Limited
70 Â Â Â Reliance Ethane Holding Pte Limited
71 Â Â Â Reliance Exploration &Â Production DMCC
72 Â Â Â Reliance GAS Lifestyle India Private Limited (Formerly Reliance Brands Luxury Private Limited)
73 Â Â Â Reliance Gas Pipelines Limited
74 Â Â Â Reliance Global Business B.V. a
75 Â Â Â Reliance Global Commercial Limited a
76 Â Â Â Reliance Global Energy Services (Singapore) Pte Ltd.
77 Â Â Â Reliance Global Energy Services Limited
78 Â Â Â Reliance Holding USA, Inc.
79 Â Â Â Reliance Industrial Investments and Holdings Limited
80 Â Â Â Reliance Industries (Middle East) DMCC
81 Â Â Â Reliance Innovative Building Solutions Private Limited
82 Â Â Â Reliance Jio AsiaInfo Innovation Centre Limited a
83 Â Â Â Reliance Jio Digital Services Limited
84 Â Â Â Reliance Jio Global Resources LLC
85 Â Â Â Reliance Jio Infocomm Limited
86 Â Â Â Reliance Jio Infocomm Pte Limited
87 Â Â Â Reliance Jio Infocomm UK Limited
88 Â Â Â Reliance Jio Infocomm USA, Inc.
89 Â Â Â Reliance Jio Infratel Private Limited
90 Â Â Â Reliance Jio Media Limited
91 Â Â Â Reliance Jio Messaging Services Limited
92 Â Â Â Reliance Lifestyle Holdings Limited
93 Â Â Â Reliance LNG Limited
# Control by Independent Media Trust of which RIL is the sole beneficiary
AÂ The above entities includes related parties where the relationship existed for the part of the year
94 Â Â Â Reliance Marcellus II LLC
95 Â Â Â Reliance Marcellus LLC
96 Â Â Â Reliance Payment Solutions Limited
97 Â Â Â Reliance Petro Marketing Limited
98 Â Â Â Reliance Petroinvestments Limited a
99 Â Â Â Reliance Polyolefins Limited
100 Â Â Â Reliance Progressive Traders Private Limited
101 Â Â Â Reliance Prolific Commercial Private Limited
102 Â Â Â Reliance Prolific Traders Private Limited
103 Â Â Â Reliance Retail Finance Limited
104 Â Â Â Reliance Retail Insurance Broking Limited
105 Â Â Â Reliance Retail Limited
106 Â Â Â Reliance Retail Ventures Limited
107 Â Â Â Reliance Sibur Elastomers Private Limited
108 Â Â Â Reliance SMSL Limited
109 Â Â Â Reliance Strategic Investments Limited
110 Â Â Â Reliance Supply Solutions Private Limited a
111 Â Â Â Reliance Trading Limited a
112 Â Â Â Reliance Universal Commercial Limited a
113 Â Â Â Reliance Universal Enterprises Limited
114 Â Â Â Reliance Universal Traders Private Limited
115 Â Â Â Reliance Vantage Retail Limited
116 Â Â Â Reliance Ventures Limited
117 Â Â Â Reliance World Trade Private Limited @
118 Â Â Â Reliance-GrandOptical Private Limited
119 Â Â Â Resolute Land Consortium Projects Limited a
120 Â Â Â RIL (Australia) Pty Limited a
121 Â Â Â RIL Exploration and Production (Myanmar) Company Limited
122 Â Â Â RIL USA, Inc.
123 Â Â Â Roptonal Limited# a
124 Â Â Â RP Chemicals (Malaysia) Sdn. Bhd.
125 Â Â Â RRB Investments Private Limited#
126 Â Â Â RRB Mediasoft Private Limited#
127 Â Â Â RRK Finhold Private Limited#
128 Â Â Â RVT Finhold Private Limited#
129 Â Â Â RVT Media Private Limited#
130 Â Â Â Santol Commercials Private Limited a
131 Â Â Â Setpro18 Distribution Limited#
132 Â Â Â Surela Investment and Trading Private Limited
133 Â Â Â Tangerine Agro Private Limited a
134 Â Â Â Television Eighteen Mauritius Limited#
135 Â Â Â Television Eighteen Media and Investment Limited#
136 Â Â Â TV18 Broadcast Limited#
137 Â Â Â TV18 Home Shopping Network Limited #a
138 Â Â Â Viacom18 Media (UK) Limited # a
139 Â Â Â Viacom18 Media Private Limited # a
140 Â Â Â Viacom18 US Inc.# a
141 Â Â Â Watermark Infratech Private Limited#
142 Â Â Â Wave Land Developers Limited a
143 Â Â Â Web18 Holdings Limited#
144 Â Â Â Web18 Software Services Limited#
145 Â Â Â Independent Media Trust
146 Â Â Â Network18 Media Trust
147 Â Â Â Petroleum Trust
148 Â Â Â Jio Payments Bank Limited
149 Â Â Â East West Pipeline Limited ( Formerly Reliance Gas Transportation Infrastructure Limited)
150 Â Â Â Gujarat Chemical Port Terminal Company Limited
151 Â Â Â Indian Vaccines Corporation Limited
152 Â Â Â Reliance Europe Limited
153 Â Â Â Reliance Industrial Infrastructure Limited
154 Â Â Â Reliance Utilities and Power Private Limited
155 Â Â Â Sikka Ports and Terminals Limited ( Formerly Reliance Ports And Terminals Limited)
156 Â Â Â Shri Mukesh D. Ambani
157 Â Â Â Shri Nikhil R. Meswani
158 Â Â Â Shri Hital R. Meswani
159 Â Â Â Shri P. M. S. Prasad
160 Â Â Â Shri P. K. Kapil
161 Â Â Â Shri Alok Agarwal
162 Â Â Â Shri Srikanth Venkatachari
163 Â Â Â Shri K. Sethuraman
164 Â Â Â Smt. Nita M. Ambani
165 Â Â Â Dhirubhai Ambani Foundation
166 Â Â Â Hirachand Govardhandas Ambani Public Charitable Trust
167 Â Â Â HNH Trust and HNH Research Society
168 Â Â Â Jamnaben Hirachand Ambani Foundation
169 Â Â Â Reliance Foundation
170 Â Â Â Reliance Foundation Institution of Education and Research^
171 Â Â Â Reliance Foundation Youth Sports
172 Â Â Â IPCL Employees Gratuity Fund - Baulpur Unit
173 Â Â Â IPCL Employees Provident Fund Trust
174 Â Â Â Reliance Industries Limited Vadodara Units Employees Superannuation Fund
175 Â Â Â RIL Vadodara Unit Employees Gratuity Fund
176 Â Â Â Reliance Employees Provident Fund Bombay
177 Â Â Â Reliance Industries Limited Staff Superannuation Scheme
178 Â Â Â Reliance Industries Limited Employees Gratuity Fund
A The above entities includes related parties where the relationship existed for the part of the year
The reserve estimates for producing fields are revised based on the performance of producing fields and with respect to discovered fields, the revision are based on the revised geological and reservoir simulation studies.
13.    Government of India (GOI), by its letters dated 2nd May, 2012, 14th November, 2013, 10th July, 2014 and 3rd June 2016 has communicated that it proposes to disallow certain costs which the Production Sharing Contract (PSC), relating to Block KG-DWN-98/3 entitles the Company to recover. Based on legal advice received, the Company continues to maintain that a Contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the Government to disallow the recovery of any Contract Cost as defined in the PSC. The Company has already referred the issue to arbitration and the arbitration is currently underway. Pending decision of the arbitration, the demand from the GOI of $ 148 million being the Company's Share (total demand $ 247 million) towards additional Profit Petroleum has been considered as contingent liability.
14.    (a) The Government has made a claim of about $ 1.55 billion against the KGD6 Contractor parties in respect of gas said to have migrated from neighboring blocks. In carrying out petroleum operations, the Contractor has worked within the boundaries of the block awarded to it and has complied with all applicable regulations and provisions of the PSC. The Company has already invoked the dispute resolution mechanism in the PSC and issued a Notice of Arbitration to the Government on 11th November, 2016. The Company remains convinced of being able to fully justify and vindicate its position that the Government's claim is not sustainable. The arbitration hearings are over and the arbitral award is awaited.
(b) In supersession of the Ministry's Gazette notification no. 22011/3/2012-ONG.D.V. dated 10th January, 2014, the GOI notified the New Domestic Natural Gas Pricing Guidelines, 2014, on 26th October, 2014. Consequent to the aforesaid dispute referred to under 32.3 above which has been referred to arbitration, the GOI has directed the Company to instruct customers to deposit differential revenue on gas sales from D1D3 field on account of the prices determined under the above guidelines converted to NCV basis and the prevailing price prior to 1st November, 2014 ($ 4.205 per MMBTU) to be credited to the gas pool account maintained by GAIL (India) Limited. The amount so deposited by customer to Gas Pool Account is Rs, 295 crore (net) as at 31st March, 2018 is disclosed under Other Non -Current Assets (refer note 4). Revenue has been recognized at the GOI notified prices in respect of gas quantities sold from D1D3 field from 1st November, 2014.
(c) Â Â Â The Company and BG Exploration and Production India Limited (together, the 'Claimants') referred a number of disputes, differences and claims arising under two Production Sharing Contract entered into in 1994 among the Claimants, Oil and Natural Gas Corporation Limited (ONCG) and the Government (the PSCs') to arbitration. The disputes relate to, among other things, the limits of cost recovery, profit sharing and audit and accounting provisions of the PSCs. The Arbitration Tribunal by majority issued a final partial award ("FPAâ), and separately, two dissenting opinions in the matter on 12 October 2016. The FPA does not conclude these proceedings as: (1) the Claimants have challenged certain parts of the FPA before the English Commercial Court and the Court has delivered its judgment on 16 April 2018 wherein it decided one of the issues in Claimants favour and this issue will be now remitted back to the Tribunal for determination; and (2) after this determination there are two further phases of the arbitration to be determined by the Tribunal viz. CRL Increase and Quantification of Final Award yet to take place. The Company has been notified by Government of its computation of the purported share of Government's Profit Petroleum and Royalty alleged to be payable by the Contractor pursuant to the Government's interpretation of the FPA. In Company's view Government's demand notice is premature since
the quantification of liabilities (if any) of the parties arising out of FPA have to be determined by the Arbitration Tribunal after the Parties have made their respective submissions on CRL increase and quantification. The Company has already responded to the Government's demand notice appropriately. The Company is in the process of reviewing the English court judgment and will take appropriate next steps.
(d) Â Â Â NTPC had filed a suit for specific performance of a contract for supply of natural gas by the Company before the Hon'ble Bombay High Court. The main issue in dispute is whether a valid, concluded and binding contract exists between the parties for supply of Natural Gas of 132 Trillion BTU annually for a period of 17 years. The matter is presently sub judice and the Company is of the view that NTPC's claim lacks merit and no binding contract for supply of gas was executed between NTPC and the Company.
(e) Â Â Â Considering the complexity of above issues, the Company is of the view that any attempt for quantification of possible exposure to the Company will have an effect of prejudicing Company's legal position in the ongoing arbitration/litigations.
15. Exploration for and Evaluation of Oil and Gas Resources
The following financial information represents the amounts included in Intangible Assets Under Development relating to activity associated with the exploration for and evaluation of oil and gas resources.
(III)Â Â Â Â The Income -Tax Assessments of the Company have been completed up to Assessment Year 2015-16. The total outstanding demand up to AY 2015-16 amounts to Rs, 11 crore as on date (i.e. 27th April, 2018). Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions of the Income tax Act, the Company has been legally advised that the additional demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(IV)Â Â Â Â The Securities and Exchange Board of India had passed an Order under section 11B of the Securities and Exchange Board of India Act, 1992 on 24th March, 2017 on a Show Cause Notice dated 16th December, 2010 issued to the Company in the matter concerning trading in the shares of Reliance Petroleum Limited by the Company in the year 2007, directing (i) disgorgement of Rs, 447 crore along with interest calculated at 12% per annum from 29th November, 2007 till date of payment and (ii) prohibiting the Company from dealing in equity derivatives in the Futures and Options segment of the stock exchanges, directly or indirectly for a period of one year from 24th March, 2017. The Company has filed an appeal against the said Order before the Hon'ble Securities Appellate Tribunal ('SAT'). SAT has stayed the direction on disgorgement till the next date of hearing and the prohibition from dealing in equity derivatives in the Futures and Options segment expired on 23rd March, 2018.
16.. CAPITAL MANAGEMENT
The Company adheres to a disciplined Capital Management framework, the pillars of which are as follows:
a) Â Â Â Maintain diversity of sources of financing and spreading the maturity across tenure buckets in order to minimize liquidity risk.
b) Â Â Â Maintain AAA rating domestically and investment grade rating internationally by ensuring that the financial strength of the Balance Sheet is preserved.
c) Â Â Â Manage financial market risks arising from foreign exchange, interest rates and commodity prices, and minimize the impact of market volatility on earnings.
d) Â Â Â Leverage optimally in order to maximize shareholder returns while maintaining strength and flexibility of Balance Sheet.
This framework is adjusted based on underlying macro-economic factors affecting business environment, financial market conditions and interest rates environment.
The financial instruments are categorized into three levels based on the inputs used to arrive at fair value measurements as described below:
Level 1:Â Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2:Â Inputs other than the quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and
Level 3:Â Inputs based on unobservable market data.
Valuation Methodology
All financial instruments are initially recognized and subsequently re-measured at fair value as described below:
a) Â Â Â The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills and Mutual Funds is measured at quoted price or NAV.
b) Â Â Â The fair value of Interest Rate Swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
c) Â Â Â The fair value of Forward Foreign Exchange contracts and Currency Swaps is determined using observable forward exchange rates and yield curves at the balance sheet date.
d) Â Â Â The fair value of over-the-counter Foreign Currency Option contracts is determined using the Black Scholes valuation model.
e) Â Â Â Commodity derivative contracts are valued using available information in markets and quotations from exchange, brokers and price index developers
f) Â Â Â The fair value of the remaining financial instruments is determined using discounted cash flow analysis.
g) Â Â Â All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.
B. Financial Risk Management
The different types of risks the company is exposed to are market risk, commodity risk, credit risk and liquidity risk. The Company uses derivative financial instruments such as forwards, options and swap contracts to minimize any adverse effect on its financial performance. All such activities are undertaken within an approved Risk Management Policy framework.
i) Market Risk a) Foreign Currency Risk
Foreign Currency Risk is the risk that the Fair Value or Future Cash Flows of an exposure will fluctuate because of changes in foreign currency rates. Exposures can arise on account of the various assets and liabilities which are denominated in currencies other than Indian Rupee.
The following table shows foreign currency exposures in US Dollar, Euro and Japanese Yen on financial instruments at the end of the reporting period. The exposure to all other foreign currencies are not material.
b. Interest Rate Risk
The company's exposure to the risk of changes in market interest rate relates to the floating rate debt obligations and derivative products taken to mitigate interest rate risk.
ii. Commodity Price Risk
Commodity price risk arises due to fluctuation in prices of crude oil, other feed stock and products. The company has a risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.
The company's commodity risk is managed centrally through well-established trading operations and control processes. In accordance with the risk management policy, the Company enters into various transactions using derivatives and uses over-the-counter as well as Exchange Traded Futures, Options and Swap contracts to hedge its commodity and freight exposure.
iii) Credit Risk
Credit risk is the risk that a customer or counterparty to a financial instrument fails to perform or pay the amounts due causing financial loss to the company. Credit risk arises from company's activities in investments, dealing in derivatives and receivables from customers.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Credit risk is actively managed through Letters of Credit, Bank Guarantees, Parent Company Guarantees, advance payments and factoring &Â forfeiting without recourse to the Company. The company restricts its fixed income investments in liquid securities carrying high credit rating.
iv) Liquidity Risk
Liquidity risk arises from the Company's inability to meet its cash flow commitments on the due date. The company maintains sufficient stock of cash, marketable securities and committed credit facilities. The company accesses global and local financial markets to meet its liquidity requirements. It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the company's cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The company's liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in the market.
C. Hedge Accounting
The company's business objective includes safe-guarding its earnings against adverse price movements of crude oil and other feedstock, refined products, freight costs as well as foreign exchange and interest rates. Reliance has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value and Cash Flow hedges. Hedging instruments include exchange traded futures and options, over-the-counter swaps, forwards and options as well as non-derivative instruments to achieve this objective. The table below shows the position of hedging instruments and hedged items as on the balance sheet date.
17.. Â Â Â EVENTS AFTER THE REPORTING PERIOD
The Board of Directors have recommended dividend of ' 6.00 per fully paid up equity share of ' 10/- each, aggregating ' 4,281 crore, including ' 728 crore dividend distribution tax for the financial year 2017-18, which is based on relevant share capital as on 31st March, 2018. The actual dividend amount will be dependent on the relevant share capital outstanding as on the record date / book closure.
18.    The figures for the corresponding previous year have been regrouped / reclassified wherever necessary, to make them comparable.
19. Â Â Â APPROVAL OF FINANCIAL STATEMENTS
The Financial Statements were approved for issue by the Board of Directors on April 27, 2018.
Â
Mar 31, 2017
1. Government of India (GOI), by its letters dated 2nd May, 2012, 14th November, 2013, 10th July, 2014 and 3rd June 2016 has communicated that it proposes to disallow certain costs which the Production Sharing Contract (PSC), relating to Block KG-DWN-98/3 entitles the Company to recover. Based on legal advice received, the Company continues to maintain that a Contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the Government to disallow the recovery of any Contract Cost as defined in the PSC. The Company has already referred the issue to arbitration and already communicated the same to GOI for resolution of disputes. Pending decision of the arbitration, the demand from the GOI of $ 148 million (for Rs, 961 crore) being the Company''s Share (total demand $ 247 million) towards additional Profit Petroleum has been considered as contingent liability.
2. (a) The Government has made a claim of about $ 1.55 billion against the KGD6 Contractor parties in respect of gas said to have migrated from neighboring blocks. In carrying out petroleum operations, the Contractor has worked within the boundaries of the block awarded to it and has complied with all applicable regulations and provisions of the Production Sharing Contract ("PSC"). The Company has already invoked the dispute resolution mechanism in the PSC and issued a Notice of Arbitration to the Government on 11th November, 2016. The Company remains convinced of being able to fully justify and vindicate its position that the Government''s claim is not sustainable.
(b) In supersession of the Ministry''s Gazette notification no. 22011/3/2012-ONG.D.V. dated 10th January, 2014, the GoI notified the New Domestic Natural Gas Pricing Guidelines, 2014, on 26th October 2014. Consequent to the aforesaid dispute referred to under 31.3 above which has been referred to arbitration, the GoI has directed the Company to instruct customers to deposit differential revenue on gas sales from D1D3 field on account of the prices determined under the above guidelines converted to NCV basis and the prevailing price prior to 1st November 2014 ($ 4.205 per MMBTU) to be credited to the gas pool account maintained by GAIL (India) Limited. The amount so deposited by customers to Gas Pool Account is Rs, 295 crore (net) as at 31st March 2017 and is disclosed under Other Non-Current Assets. Revenue has been recognized at the GoI notified prices in respect of gas quantities sold.
(c) In December 2010, the Company and BG Exploration and Production India Limited (together, the ''Claimants'') referred a number of disputes, differences and claims arising under two Production Sharing Contracts entered into in 1994 among the Claimants, Oil and Natural Gas Corporation Limited (ONGC) and the Government (the ''PSCs'') to arbitration. The disputes relate to, among other things, the limits of cost recovery, profit sharing and audit and accounting provisions of the PSCs. the Tribunal by majority issued a final partial award ("FPA"), and separately, two dissenting opinions in the matter on 12 October 2016. Claimants have challenged certain parts of the FPA before the English Court and the English court has initiated steps to effect service of the Challenge proceedings upon the Government.
(d) NTPC had filed a suit for specific performance of a contract for supply of natural gas by RIL before the Hon''ble Bombay High Court. The main issue in dispute is whether a valid, concluded and binding contract exists between the parties for supply of Natural Gas of 132 Trillion BTU annually for a period of 17 years. The matter is presently sub judice and RIL is of the view that NTPC''s claim lacks merit and no binding contract for supply of gas was executed between NTPC and RIL."
(e) Considering the complexity of above issues, the Company is of the view that any attempt for quantification of possible exposure to the Company will have an effect of prejudicing Company''s legal position in the ongoing arbitration/litigations.
3 Exploration for and Evaluation of Oil and Gas Resources
The following financial information represents the amounts included in Intangible Assets under Development relating to activity associated with the exploration for and evaluation of oil and gas resources.
* The Company has been advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(iii) The Income -Tax Assessments of the Company have been completed up to Assessment Year 2013-14. The total outstanding demand up to Assessment Year 2013-14 is Rs, 2,257 crore as on date (i.e 31st March 2017). Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the additional demand raised is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.
(IV) The Securities and Exchange Board of India has passed an Order under section 11B of the Securities and Exchange Board of India Act, 1992 on 24th March 2017 in the matter concerning trading in RPL shares by the Company in the year 2007, directing (i) disgorgement of Rs, 447 crores along with interest calculated at 12% per annum from 29th November 2007 till date of payment and (ii) prohibiting RIL from dealing in equity derivatives in the Futures and Options segment of the stock exchanges, directly or indirectly for a period of one year from 24th March 2017.The Company has been legally advised that the Order is based on surmises, conjectures and untenable reasoning. The Company is in the process of filing an appeal against the said Order before the Securities Appellate Tribunal.
The Company adheres to a robust Capital Management framework which is underpinned by the following guiding principles;
a) Maintain financial strength to ensure AAA ratings domestically and investment grade ratings internationally.
b) Ensure financial flexibility and diversify sources of financing and their maturities to minimize liquidity risk while meeting investment requirements.
c) Proactively manage group exposure in forex, interest and commodities to mitigate risk to earnings.
d) Leverage optimally in order to maximize shareholder returns while maintaining strength and flexibility of the Balance sheet.
This framework is adjusted based on underlying macro-economic factors affecting business environment, financial market conditions and interest rates environment.
Valuation
All financial instruments are initially recognized and subsequently re-measured at fair value as described below:
a) The fair value of investment in quoted Equity Shares, Bonds, Government Securities, Treasury Bills and Mutual Funds is measured at quoted price or NAV.
b) The fair value of Interest Rate Swaps is calculated as the present value of the estimated future cash flows based on observable yield curves.
c) The fair value of Forward Foreign Exchange contracts and Currency Swaps is determined using forward exchange rates and yield curves at the balance sheet date.
d) The fair value of Foreign Currency Option contracts is determined using the Black Scholes valuation model.
e) Commodity derivative contracts are valued using readily available information in markets and quotations from exchange, brokers and price index developers
f) The fair value of the remaining financial instruments is determined using discounted cash flow analysis.
g) All foreign currency denominated assets and liabilities are translated using exchange rate at reporting date.
The company has a prudent and conservative process for managing its credit risk arising in the course of its business activities. Sales made to customers on credit are generally secured through Letters of Credit, Bank Guarantees, Parent Company Guarantees, advance payments and factoring & forfaiting without recourse to RIL.
Liquidity Risk
Liquidity risk arises from the Company''s inability to meet its cash flow commitments on time. Prudent liquidity risk management implies maintaining sufficient stock of cash and marketable securities (Rs, 69,337 crores as on 31st March 2017; Rs, 79,507 crores as on 31st March 2016) and maintaining availability of standby funding through an adequate line up of committed credit facilities (Rs, 21,831 crores as on 31st March 2017; Rs, 43,498 crores as on 31st March 2016). Company accesses global financial markets to meet its liquidity requirements.
It uses a range of products and a mix of currencies to ensure efficient funding from across well-diversified markets and investor pools. Treasury monitors rolling forecasts of the company''s cash flow position and ensures that the company is able to meet its financial obligation at all times including contingencies.
The company''s liquidity is managed centrally with operating units forecasting their cash and liquidity requirements. Treasury pools the cash surpluses from across the different operating units and then arranges to either fund the net deficit or invest the net surplus in the market.
Hedge Accounting
The company''s business objective includes safe-guarding its hydrocarbon earnings against adverse price movements of crude oil and other feedstock, refined products, freight costs as well as foreign exchange and interest rates. Reliance has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value and Cash Flow hedges. Hedging instruments include exchange traded futures and options, OTC swaps, forward and options as well as no derivative instruments to achieve this objective. The table below shows the position of hedging instruments and hedged items as of the balance sheet date.
* Including Share Application Money pending for allotment.
Notes:
I Change in accounting policy for Oil & Gas Activity - From Full cost method (FCM) to Successful Efforts Method (SEM):
The impact on account of change in accounting policy from FCM to SEM is recognized in the Opening Reserves on the date of transition and consequential impact of depletion and write offs is recognized in the Statement of Profit and Loss.
Major differences impacting such change of accounting policy are in the areas of;
- Expenditure on surrendered blocks, unproved wells and abandoned wells, which has been expensed under SEM.
- Depletion on producing property in SEM is calculated using Proved Developed Reserve, as against Proved Reserve in FCM.
II Fair valuation as deemed cost for Property, Plant and Equipment:
The Company have considered fair value for property, viz land admeasuring over 30,000 acres, situated in India, with impact of '' 41,292 crore in accordance with stipulations of Ind AS 101 with the resultant impact being accounted for in the reserves.
III Fair valuation for Financial Assets:
The Company has valued financial assets (other than Investment in subsidiaries, associate and joint ventures which are accounted at cost), at fair value. Impact of fair value changes as on the date of transition, is recognized in opening reserves and changes thereafter are recognized in Statement of Profit and Loss or Other Comprehensive Income, as the case may be.
IV Deferred Tax:
The impact of transition adjustments together with Ind AS mandate of using balance sheet approach (against profit and loss approach in the previous GAAP) for computation of deferred taxes has resulted in charge to the Reserves, on the date of transition, with consequential impact to the Statement of Profit and Loss for the subsequent periods.
V Others:
Other adjustments primarily comprise of :
a. Attributing time value of money to Assets Retirement Obligation: Under Ind AS, such obligation is recognized and measured at present value. Under previous Indian GAAP it was recorded at cost. The impact for the periods subsequent to the date of transition is reflected in the Statement of Profit and Loss.
b. Loan processing fees / transaction cost: Under Ind AS such expenditure are considered for calculating effective interest rate. The impact for the periods subsequent to the date of transition is reflected in the Statement of Profit and Loss.
Mar 31, 2016
1.1 45,04,27,345 Shares were allotted on conversion / surrender of
Debentures and Bonds, conversion of Term Loans, exercise (45,04,27,345)
of Warrants, against Global Depository Shares (GDS) and re-issue of
Forfeited Equity Shares, since inception.
1.2 17,18,83,624 Shares held by subsidiaries, which were allotted
pursuant to the Schemes of Amalgamation sanctioned by (17,18,83,624)
the Hon''ble High Courts in the previous years, do not have voting
rights and are not eligible for Bonus Shares
1.3 4,62,46,280 Shares were bought back and extinguished in the last
five years. (4,62,46,280)
1.4 The Company has reserved issuance of 12,20,30,651 (Previous year
12,67,18,207) Equity Shares of Rs, 10 each for offering to Eligible
Employees of the Company and its subsidiaries under Employees Stock
Option Scheme (ESOS). During the year the Company has granted 14,967
options at a price of Rs, 887 per option, plus all applicable taxes, as
may be levied in this regard on the Company (Previous year 45,419
options which includes 21,367 options at a price of Rs, 936 per option,
13,052 options at a price of Rs, 961 per option and 11,000 options at a
price of Rs, 843 per option, plus all applicable taxes, as may be
levied in this regard on the Company) to the Eligible Employees. The
options would vest over a maximum period of 7 years or such other
period as may be decided by the Human Resources, Nomination and
Remuneration Committee from the date of grant based on specified
criteria.
1.5 Share Application Money Pending Allotment represents application
money received on account of Employees Stock Option Scheme.
2.1 Non Convertible Debentures referred above to the extent of:
a) Rs, 370 crore are secured by way of first mortgage / charge on the
immovable properties situated at Hazira Complex and at Jamnagar Complex
(other than SEZ unit) of the Company.
b) Rs, 400 crore are secured by way of first mortgage / charge on all
the properties situated at Hazira Complex and at Patalganga Complex of
the Company.
c) Rs, 500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (SEZ unit) of the
Company.
2.2 Finance Lease Obligations are secured against Leased Assets.
2.3 Maturity Profile and Rate of Interest of Bonds are as set out
below:
2.4 Bonds include 5.875% Senior Perpetual Notes (the "Notes") of Rs,
5,300 crore. The Notes have no fixed maturity date and the Company will
have an option, from time to time, to redeem the Notes, in whole or in
part, on any semi-annual interest payment date on or after February 5,
2018 at 100% of the principal amount plus accrued interest.
3.1 Working Capital Loans from Banks of Rs, 1,672 crore (Previous Year
Rs, 672 crore) are secured by hypothecation of present and future stock
of raw materials, stock-in-process, finished goods, stores and spares
(not relating to plant and machinery), book debts, outstanding monies,
receivables, claims, bills, materials in transit, etc. save and except
receivables of Oil and Gas Division.
3.2 Working Capital Loans from Others of Rs, 1,649 crore (Previous Year
Rs, Nil) are secured by way of lien on Government Securities.
4.1 Leasehold Land includes Rs, 317 crore (Previous Year Rs, 203
crore) in respect of which lease-deeds are pending execution.
4.2 Buildings includes :
i) Cost of shares in Co-operative Societies Rs, 1,99,950 (Previous Year
Rs, 1 crore).
ii) Rs, 135 crore (Previous Year Rs, 93 crore) in shares of Companies /
Societies with right to hold and use certain area of Buildings.
4.3 Intangible Assets - Others includes :
i) Jetties amounting to Rs, 812 crore (Previous Year Rs, 812 crore),
the Ownership of which vests with Gujarat Maritime Board.
ii) Rs, 8,367 crore (Previous Year Rs, 8,367 crore) in preference
shares of subsidiaries and lease premium paid with right to hold and
use Land and Buildings.
4.4 Capital Work-in-Progress and Intangible Assets under Development
includes :
i) Rs, 11,022 crore (Previous Year Rs, 6,770 crore) on account of
Project Development Expenditure. ii) Rs, 18,646 crore (Previous Year
Rs, 16,346 crore) on account of cost of construction materials at site.
4.5 Project Development Expenditure
(in respect of Projects upto 31st March, 2016, included under capital
work-in-progress and intangible Assets under Development)
4.6 The Gross Block of Fixed Assets includes Rs, 38,122 crore
(Previous Year Rs, 38,122 crore) on account of revaluation of Fixed
Assets carried out since inception.
4.7 Additions in plant and machinery, Capital work-in-progress,
Intangible Assets - Development Rights and Intangible assets under
Development includes Rs, 8,605 crore (net loss) [Previous Year Rs,
4,709 crore (net loss)] on account of exchange difference during the
year.
4.8 Pursuant to the enactment of Companies Act 2013, the company has
applied the estimated useful lives as specified in Schedule II, except
in respect of certain assets as disclosed in Accounting Policy on
Depreciation, Amortisation and Depletion. Accordingly the unamortised
carrying value is being depreciated / amortised over the revised /
remaining useful lives. The written down value of Fixed Assets whose
lives have expired as at 1st April 2014 have been adjusted net of tax,
in the opening balance of Profit and Loss Account of the year ended
31st March, 2015, amounting to Rs, 318 crore.
5.1 Cash and Cash Equivalents includes deposits maintained by the
Company with banks, which can be withdrawn by the Company at any point
of time without prior notice or penalty on the principal.
6.1 The Company had announced Voluntary Separation Scheme (VSS) for
the employees of Allahabad & Nagpur Manufacturing Divisions (Previous
Year Silvassa Manufacturing Division) during the year. A sum of Rs, 156
crore (Previous Year Rs, 32,00,000) has been paid during the year and
debited to the Profit and Loss Statement under the head "Employee
Benefits Expense".
6.2 Corporate Social Responsibility (CSR)
(a) CSR amount required to be spent as per Section 135 of the Companies
Act, 2013 read with Schedule VII thereof by the company during the year
is Rs, 558 crore (Previous Year Rs, 533 crore)
(b) Expenditure related to Corporate Social Responsibility is Rs, 652
crore (Previous Year Rs, 761crore).
(c) Out of note (b) above, Rs, 578 crore (Previous Year Rs, 729 crore)
is spent through Reliance Foundation, a related party.
(d) Out of note (b) above, Rs, 7 crore (Previous Year Rs, Nil) is
towards construction / acquisition of an asset that will be owned by
the Company.
7. REMITTANCE IN FOREIGN CURRENCY ON ACCOUNT OF DIVIDEND
The Company has paid dividend in respect of shares held by
Non-Residents on repatriation basis. This inter-alia includes portfolio
investment and direct investment, where the amount is also credited to
Non-Resident External Account (NRE A/c). The exact amount of dividend
remitted in foreign currency cannot be ascertained. The total amount
remittable in this respect is given herein below:
8. As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
Mar 31, 2015
1.1 45,04,27,345 Shares were allotted on conversion / surrender of
Debentures and Bonds, conversion of Term (45,04,27,345) Loans, exercise
of Warrants, against Global Depository Shares (GDS) and re-issue of
Forfeited
Equity Shares, since inception.
1.2 17,18,83,624 Shares held by subsidiaries, which were allotted
pursuant to the Schemes of Amalgamation sanctioned (17,18,83,624) by
the Hon'ble High Courts in the previous years, do not have voting
rights and are not eligible for
Bonus Shares
1.3 4,62,46,280 Shares were bought back and extinguished in the last
five years.
(4,62,46,280)
1.4 The Company has reserved issuance of 12,67,18,207 (Previous year
13,05,05,114) Equity Shares of Rs. 10 each for offering to Eligible
Employees of the Company and its subsidiaries under Employees Stock
Option Scheme (ESOS). During the year the Company has granted 45,419
options which includes 21,367 options at a price Rs. 936 per option,
13,052 options at a price of Rs. 961 per option and 11,000 options at a
price of Rs. 843 per option plus all applicable taxes, as may be levied
in this regard on the Company (Previous year 71,866 options which
includes 60,866 options at a price of Rs. 860 per option and 11,000
options at a price of Rs. 880 per option plus all applicable taxes, as
may be levied in this regard on the Company) to the Eligible Employees.
The options would vest over a maximum period of 7 years or such other
period as may be decided by the Human Resources, Nomination and
Remuneration Committee from the date of grant based on specified
criteria.
1.5 Share Application Money Pending Allotment represents application
money received on account of Employees Stock Option Scheme.
2.1 Non Convertible Debentures referred above to the extent of:
a) Rs. 533 crore are secured by way of first mortgage / charge on all the
properties situated at Hazira Complex and at Patalganga Complex of the
Company.
b) Rs. 500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (SEZ unit) of the
Company.
c) Rs. 370 crore are secured by way of first mortgage / charge on the
immovable properties situated at Hazira Complex and at Jamnagar Complex
(other than SEZ units) of the Company.
d) Rs. 31 crore are secured by way of first mortgage / charge on certain
properties situated at Surat in the State of Gujarat and on Fixed
Assets situated at Allahabad Complex of the Company.
2.2 Finance Lease Obligations are secured against Leased Assets.
2.3 Bonds include 5.875% Senior Perpetual Notes (the "Notes") of Rs.
5,000 crore. The Notes have no fixed maturity date and the Company will
have an option, from time to time, to redeem the Notes, in whole or in
part, on any semi- annual interest payment date on or after February 5,
2018 at 100% of the principal amount plus accrued interest.
3. LONG TERM PROVISIONS
During the current financial year, Tapti Joint Venture (JV) achieved
resolution with Government of India (GoI) that the Tapti JV will assume
responsibility for abandonment obligation of Tapti Part B facilities.
Accordingly, the Company has recognized a liability related to
dismantling and abandonment of facilities based on the estimated future
expenditure. Further the Company has also recognized similar
liabilities for D1D3 and MA fields based on the estimates provided in
the development plan. Aggregate provision recognised is Rs. 1,404 crore
($ 224.70 Million)
4.1 Working Capital Loans from Banks referred above to the extent of:
(a) Rs. 672 crore (Previous Year Rs. 3,906 crore) are secured by
hypothecation of present and future stock of raw materials,
stock-in-process, finished goods, stores and spares (not relating to
plant and machinery), book debts, outstanding monies, receivables,
claims, bills, materials in transit, etc. save and except receivables
of Oil and Gas Division.
(b) Rs. Nil (Previous Year Rs. 3,105 crore) are secured by way of lien on
Fixed Deposits and Rs. Nil (Previous Year Rs. 978 crore) are secured by
lien on Government Securities.
4.2 Working Capital Loan from Others of Rs. Nil (Previous Year Rs. 1,199
crore) are secured by lien on Government Securities.
5.1 Leasehold Land includes Rs. 203 crore (Previous Year Rs. 203 crore) in
respect of which lease-deeds are pending execution.
5.2 Buildings includes :
i) Cost of shares in Co-operative Housing Societies Rs. 1 crore (Previous
Year Rs. 1 crore).
ii) Rs. 5 crore (Previous Year Rs. 5 crore) in respect of which conveyance
is pending.
iii) Rs. 93 crore (Previous Year Rs. 93 crore) in shares of Companies /
Societies with right to hold and use certain area of Buildings.
5.3 Intangible Assets - Others includes :
i) Jetties amounting to Rs. 812 crore (Previous Year Rs. 812 crore), the
Ownership of which vests with Gujarat Maritime Board.
ii) Rs. 8,367 crore (Previous Year Rs. 8,367 crore) in preference shares of
subsidiaries and lease premium paid with right to hold and use Land and
Buildings.
5.4 Capital Work-in-Progress and Intangible Assets under Development
includes :
i) Rs. 6,770 crore (Previous Year Rs. 4,204 crore) on account of Project
Development Expenditure.
ii) Rs. 16,346 crore (Previous Year Rs. 10,951 crore) on account of cost of
construction materials at site.
5.6 The Gross Block of Fixed Assets includes Rs. 38,122 crore (Previous
Year Rs. 38,122 crore) on account of revaluation of Fixed Assets carried
out since inception.
5.7 Additions in Plant and Machinery, Capital Work-in-Progress,
Intangible Assets - Development Rights and Intangible Assets under
Development includes Rs. 4,709 crore (net loss) [Previous Year Rs. 8,678
crore (net loss)] on account of exchange difference during the year.
5.8 i) In respect of Fixed Assets acquired on finance lease on or
after 1st April, 2001, the minimum lease rentals outstanding as on 31st
March, 2015 are as follows:
ii) General Description of Lease Terms:
Assets are taken on Lease over a period of 5 to 10 years.
iii) Fixed Assets taken on finance lease prior to 1st April, 2001,
amount to Rs. 444 crore (Previous Year Rs. 444 crore). Future obligations
towards lease rentals under the lease agreements as on 31st March, 2015
amount to Rs. 1 crore (Previous Year Rs. 2 crore).
5.9 Pursuant to the enactment of Companies Act 2013, the company has
applied the estimated useful lives as specified in Schedule II, except
in respect of certain assets as disclosed in Accounting Policy on
Depreciation, Amortisation and Depletion. Accordingly the unamortised
carrying value is being depreciated / amortised over the revised/
remaining useful lives. The written down value of Fixed Assets whose
lives have expired as at 1st April 2014 have been adjusted net of tax,
in the opening balance of Profit and Loss Account amounting to Rs. 318
crore.
6.1 Loans and Advances in the nature of Loans given to Subsidiaries
and Associates:
(i) Loans and Advances shown above, fall under the category of 'Long
Term Loans & Advances' in nature of Loans and are re-payable within 3
to 5 years except Short Term Loans and Advances to Reliance Ventures
Limited and Reliance Strategic Investments Limited.
(ii) All the above Loans and Advances are interest bearing except for
an amount of Rs. 11,202 crore given to Reliance Industrial Investments
and Holdings Limited and Rs. 33 crore to Reliance Gas Pipelines Limited.
(iii) Loans to employees as per the Company's policy are not considered.
A) (i) Investment by the Loanee in the shares of the Company
*None of the loanees and loanees of subsidiary companies have, per se,
made investments in shares of the Company. These investments represent
shares of the Company allotted as a result of amalgamation of erstwhile
Reliance Petroleum Limited (amalgamated in 2001-02) and Indian
Petrochemicals Corporation Limited with the Company under the Schemes
approved by the Hon'ble High Court of Judicature at Bombay and Gujarat
and certain subsequent inter se transfer of shares.
33.2 (a) Net Quantities of Company's Interest (on gross basis) in
Proved Reserves and Proved Developed Reserves :
(b) In case of producing field and fields where development of drilling
activities are in progress, the geological and reservoir simulation are
updated as and when new well information is available. In all cases,
reserve evaluation is carried out at least once in a year.
(c) The reserves estimates related to KGD6 and NEC25 have been revised.
During the year, the Company recognized reserves towards CB10 block
post review of Declaration of Commerciality (DoC) by Management
Committee.
(d) The Government of India (GoI), by its letters dated 2nd May 2012,
14th November 2013 and 10th July 2014 has communicated that it proposes
to disallow certain costs which the Production Sharing Contract (PSC),
relating to KG-DWN-98/3 entitles the Company to recover. Based on legal
advice received, the Company continues to maintain that a Contractor is
entitled to recover all of its costs under the terms of the PSC and
there are no provisions that entitle the GoI to disallow the recovery
of any Contract Cost as defined in the PSC. The Company has already
referred the issue to arbitration and already communicated the same to
GoI for the resolution of dispute. Pending decision of the arbitration,
the demand from the GoI of $ 117 million ( Rs. 731 crores) being the
Company's share (total demand $ 195 million) towards additional Profit
Petroleum has been considered as contingent liability.
(e) In supersession of the Ministry's Gazette notification no.
22011/3/2012-ONG.D.V. dated 10th January, 2014, the GoI notified the
New Domestic Natural Gas Pricing Guidelines, 2014, on 25th October
2014. As per new notification, GoI had revised the price of Gas to $
5.05 per MMBTU on Gross Calorific Value (GCV) basis from the existing
price of $ 4.205 on Net Calorific Value (NCV) basis per MMBTU with
effect from 01st November 2014 for the period from November 2014 to
March 2015. Consequent to the aforesaid dispute referred to under 33.2
(d) above which has been referred to arbitration, the GoI has directed
the Company to instruct customers to deposit differential revenue on
gas sales from D1D3 field on account of the price determined under the
guidelines converted to NCV basis and the prevailing price prior to 1st
November 2014 ($ 4.205 per MMBTU) to be credited to the gas pool
account maintained by GAIL (India) Limited. The amount so deposited by
customer to Gas Pool Account is Rs. 147 crore as at 31st March 2015 is
disclosed under Other Long Term Loans and Advances. Revenue has been
recognized at the GoI notified price of $ 5.05 MMBTU on GCV basis, in
respect of gas quantities sold from D1D3 field from 1st November 2014.
(Rs. in crore)
As at As at
31st March, 2015 31st March, 2014
7. CONTINGENT LIABILITIES AND
COMMITMENTS
(I) Contingent Liabilities
(A) Claims against the Company /
disputed liabilities not
acknowledged as debts*
(a) In respect of Joint Ventures 798 414
(b) In respect of Others 1,770 1,433
(B) Guarantees
(i) Guarantees to Banks and Financial Institutions against credit
facilities extended to third parties and other Guarantees
(a) In respect of Joint Ventures - -
(b) In respect of Others 35,418 32,308
(ii) Performance Guarantees
(a) In respect of Joint Ventures - -
(b) In respect of Others 274 290
(iii) Outstanding Guarantees furnished to Banks and Financial
Institutions including in respect of Letters of Credits
(a) In respect of Joint Ventures 20 700
(b) In respect of Others 17,704 4,843
(C) Other Money for which the Company is contingently liable
(i) Liability in respect of bills discounted with Banks (Including
third party bills discounting)
(a) In respect of Joint Ventures - -
(b) In respect of Others 1,121 4,970
(II) Commitments
(A) Estimated amount of contracts remaining to be executed on capital
account and not provided for:
(a) In respect of Joint Ventures 865 1,168
(b) In respect of Others 20,569 25,349
(B) Other Commitments
(a) Sales Tax deferral liability
assigned 787 1,563
(b) Guarantee against future cash
calls ** 1,315 2,917
* The Company has been advised that the demand is likely to be either
deleted or substantially reduced and accordingly no provision is
considered necessary.
** The Company has issued Guarantees against future cash calls to be
made by JV Partners of its wholly owned subsidiary Reliance Marcellus
LLC.
(III) The Income-Tax Assessments of the Company have been completed up
to Assessment Year 2010-11. The assessed tax liability exceeds the
provision made, by Rs. 509 crore as on 31st March, 2015. Based on the
decisions of the Appellate authorities and the interpretations of other
relevant provisions, the Company has been legally advised that the
additional demand raised is likely to be either deleted or
substantially reduced and accordingly no provision is considered
necessary.
b) Foreign Currency Exposures that are not hedged by derivative
instruments as on 31st March 2015 amount to Rs. 82,812 crore (Previous
Year Rs. 64,918 crore). The unhedged exposures are naturally hedged by
future foreign currency earnings and earnings linked to foreign
currency.
8. As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
9. DETAILS OF LOANS GIVEN, INVESTMENTS MADE AND GUARANTEE GIVEN
COVERED U/S 186 (4) OF THE COMPANIES ACT, 2013 Loans given and
Investments made are given under the respective heads.
10.1 The Company had announced Voluntary Separation Scheme (VSS) for
the employees of Silvassa Manufacturing Division during the previous
year. A sum of Rs. 32,00,000 (Previous Year Rs. 31 crore) has been paid
during the year and debited to the Profit and Loss Statement under the
head "Employee Benefits Expense".
(b) In case of producing field and fields where development of drilling
activities is in progress, the geological and reservoir simulation are
updated as and when new well information is available. In all cases,
Reserve evalua- tion is carried out at least once in a year.
(c) The reserves estimates related to KGD6 and NEC25 have been revised.
During the year, the Company recognized reserves towards CB10 block
post review of Declaration of Commerciality (DoC) by Management
Committee.
(III) The Income-Tax Assessments of the Company have been completed up
to Assessment Year 2010-11. The assessed tax liability exceeds the
provision made by Rs. 726 crore as on 31st March, 2015. Based on the
decisions of the Appellate authorities and the interpretations of other
relevant provisions, the Company has been legally advised that the
additional demand raised is likely to be either deleted or
substantially reduced and accordingly no provision is considered
necessary.
11. FINANCIAL AND DERIVATIVE INSTRUMENTS
a) Derivative contracts entered into by the Company and outstanding as
on 31st March, 2015
(i) For hedging Currency and Interest Rate Related Risks:
Nominal amounts of derivative contracts entered into by the Company and
outstanding as on 31st March, 2015 amount to Rs. 1,74,754 crore (Previous
Year Rs. 1,15,654 crore).
b) Foreign Currency Exposures that are not hedged by derivative
instruments as on 31st March, 2015 amount to Rs. 85,791 crore (Previous
Year Rs. 65,612 crore). The unhedged exposures are naturally hedged by
future foreign currency earnings and earnings linked to foreign
currency.
c) Other Option Contracts of Rs. 16 crore and Future Contracts of Rs. 306
crore are outstanding as on 31st March, 2015.
12. The audited/unaudited financial statements of foreign subsidiaries
/ associates have been prepared in accordance with the Generally
Accepted Accounting Principle of its Country of Incorporation or
International Financial Reporting Standards. The differences in
accounting policies of the Company and its subsidiaries / associates
are not material and there are no material transactions from 1st
January, 2015 to 31st March, 2015 in respect of subsidiaries /
associates having financial year ended 31st December, 2014.
Names of Subsidiaries which are yet to commence operations - Sr.
Name of the Companies No.
1 Reliance Jio Global Resources LLC
2 Reliance Marcellus Holdings LLC
3 Reliance Textiles Limited
Names of Subsidiaries which have been liquidated or sold during the
year - Sr.
Name of the Companies No.
1 Achman Commercial Private Limited
2 Delight Proteins Limited
3 Gapco Rwanda Limited
4 GenNext Innovation Ventures Limited
5 Infotel Telecom Limited
6 Kaizen Capital LLP
7 LPG Infrastructure (India) Limited
8 Mark Project Services Private Limited
9 Rancore Technologies Private Limited
10 Reliance Agri Ventures Private Limited
11 Reliance Convention and Exhibition Centre Limited
12 Reliance Corporate Centre Limited
13 Reliance Corporate Services Limited
14 Reliance Dairy Foods Limited
15 Reliance F&B Services Limited
16 Reliance Financial Distribution and Advisory Services Limited
17 Reliance Food Processing Solutions Limited
18 Reliance Gas Corporation Limited
19 Reliance Industries Investment and Holding Limited
20 Reliance Infrastructure Management Services Limited
21 Reliance Nutritious Food Products Limited
22 Reliance People Serve Limited
23 Reliance Review Cinema Limited
24 Reliance Security Solutions Limited
25 Reliance Strategic (Mauritius) Limited
26 Reliance Style Fashion India Private Limited
27 Reliance Styles India Limited
All the above Companies have been amalgamated pursuant to the Scheme of
Amalgamation except:
1. Gapco Rwanda Limited which has been sold during the year.
2. Reliance Strategic (Mauritius) Limited and Kaizen Capital LLP which
have been liquidated during the year.
Mar 31, 2014
1.1 162,67,93,078 Shares were allotted as Bonus Shares in the last five
years by capitalisation of Securities Premium (162,67,93,078) and
Reserves.
1.2 6,92,52,623 Shares were allotted in the last five years pursuant to
the Scheme of amalgamation with Reliance (6,92,52,623) Petroleum
Limited without payments being received in cash.
1.3 45,04,27,345 Shares were allotted on conversion / surrender of
Debentures and Bonds, conversion of Term (45,04,27,345) Loans, exercise
of warrants, against Global Depository Shares (GDS) and re-issue of
forfeited equity shares, since inception.
1.4 17,18,83,624 Shares held by Subsidiaries do not have Voting Rights
and are not eligible for Bonus Shares (17,18,83,624)
1.5 4,62,46,280 Shares were bought back and extinguished in the last
five years. (4,62,46,280)
1.6 The Company has reserved issuance of 13,05,05,114 (Previous year
13,37,43,590) Equity Shares ofRs. 10 each for offering to eligible
employees of the Company and its subsidiaries under Employees Stock
Option Scheme (ESOS). During the year, the Company has granted 60,866
(Previous Year NIL) options to the eligible employees at a price ofRs.
860 per option plus all applicable taxes, as may be levied in this
regard on the Company. The options would vest over a maximum period of
7 years or such other period as may be decided by the Human Resources,
Nomination and Remuneration Committee from the date of grant based on
specified criteria.
1.7 Share application money pending allotment represents application
money received on account of Employees Stock Option Scheme.
2.1 Non Convertible Debentures referred above to the extent of:
a) Rs. 370 crore are secured by way of first mortgage /charge on the
immovable properties situated at Hazira Complex and at Jamnagar Complex
(other than SEZ units) of the Company.
b) Rs. 917 crore are secured by way of first mortgage/charge on all the
properties situated at Hazira Complex and at Patalganga Complex of the
Company.
c) Rs. 30 crore are secured by way of first mortgage / charge on certain
properties situated at Surat in the State of Gujarat and on fixed
assets situated at Allahabad Complex of the Company.
d) Rs.51 crore are secured by way of first mortgage /charge on movable and
immovable properties situated at Thane in the State of Maharashtra and
on movable properties situated at Baulpur Complex of the Company.
e) Rs. 500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (SEZ unit) of the
Company.
2.2 Finance Lease Obligations are secured against leased assets.
2.3 Bonds include, 5.875% Senior Perpetual Notes (the "Notes") of Rs.
4,793 crore. The Notes have no fixed maturity date and the Company will
have an option, from time to time, to redeem the Notes, in whole or in
part, on any semi-annual interest payment date on or after February
5,2018 at 100% of the principal amount plus accrued interest.
3.1 Working Capital Loans from Banks referred above to the extent of:
(a) Rs. 3,906 crore are secured by hypothecation of present and future
stock of raw materials, stock-in-process, finished goods, stores and
spares (not relating to plant and machinery), book debts, outstanding
monies, receivables, claims, bills, materials in transit, etc. save and
except receivables of Oil and Gas Division.
(b) Rs. 3,105 crore are secured by way of lien on fixed deposits and Rs.
978 crore are secured by lien on Government Securities.
3.2 Working Capital Loan from Others ofRs. 1,199 crore are secured by
lien on Government Securities.
4.1 Leasehold Land includesRs. 203 crore (Previous YearRs. 203 crore) in
respect of which lease-deeds are pending execution.
4.2 Buildings include:
i) Cost of shares in Co-operative Housing SocietiesRs. 1 crore (Previous
YearRs. 1 crore). ii) Rs.5 crore (Previous YearRs. 5 crore) in respect of
which conveyance is pending.
iii) Rs. 93 crore (Previous Year Rs. 93 crore) in shares of Companies /
Societies with right to hold and use certain area of Buildings.
4.3 Intangible Assets - Others include:
i) Jetties amounting to Rs. 812 crore (Previous Year Rs. 812 crore), the
Ownership of which vests with Gujarat Maritime Board. However, under an
agreement with Gujarat Maritime Board, the Company has been permitted
to use the same at a concessional rate.
ii) Rs. 8,367 crore (Previous Year Rs. 8,367 crore) in preference shares of
subsidiaries and lease premium paid with right to hold and use Land and
Buildings.
4.4 Capital Work-in-Progress and Intangible Assets under development
include:
i) Rs. 4,204 crore (Previous YearRs. 2,795 crore) on account of project
development expenditure, ii) Rs. 10,951 crore (Previous YearRs. 4,685
crore) on account of cost of construction materials at site.
4.5 Gross Block includesRs. 12,901 crore added on revaluation of
Building, Plant & Machinery and Equipments as at 01.01.2009 based on
reports issued by international values.
4.6 The Gross Block of Fixed Assets includesRs. 38,122 crore (Previous
YearRs. 38,122 crore) on account of revaluation of Fixed Assets carried
out since inception. Consequent to the said revaluation there is an
additional charge of depreciation of Rs. 1,845 crore (Previous YearRs.
2,072 crore) and an equivalent amount has been withdrawn from
Revaluation Reserve/ General Reserve.
4.7 Additions in Plant and Machinery, Capital Work-in-Progress,
Intangible Assets - Development Rights and Intangible Assets under
development includesRs. 8,678 crore (net loss) [Previous YearRs. 5,070
crore (net loss)] on account of exchange difference during the year.
4.8 Additions for the previous year includes freehold land Rs. 56 crore,
buildings Rs.674 crore, plant and machineryRs. 1,189 crore, furniture and
fixturesRs. 12 crore, vehiclesRs. 10 crore and softwareRs. 1 crore on
amalgamation of Reliance Jamnagar Infrastructure Limited with the
Company. Accumulated depreciation of Rs. 603 crore on the above assets
has been included in depreciation for the previous year.
(a) Loans and Advances shown above, fall under the category of Long
Term Loans and Advances in nature of Loans and are re-payable within 3
to 5 years except Short Term Loans and Advances to Reliance Ventures
Limited and Reliance Strategic Investments Limited.
(b) All the above loans and advances are interest bearing except for an
amount ofRs. 13,454 crore given to Reliance Industrial Investments and
Holdings Limited and Rs. 33 crore paid to Reliance Gas Pipelines Limited.
(c) Loans to employees as per Companys policy are not considered.
B) (i) Investment by the loanee in the shares of the Company
*None of the loanees and loanees of subsidiary companies have, per se,
made investments in shares of the Company. These investments represent
shares of the Company allotted as a result of amalgamation of erstwhile
Reliance Petroleum Limited (amalgamated in 2001-02) and Indian
Petrochemicals Corporation Limited with the Company under the Schemes
approved by the Honble High Court of Judicature at Bombay and Gujarat
and certain subsequent inter se transfer of shares.
(b) In case of producing field and fields where development of drilling
activities is in progress, the geological and reservoir simulation are
updated as and when new well information is available. In all cases.
Reserve evaluation is carried out at least once in a year.
(c) The Government of India, by its letters dated 2nd May 2012 and 14th
November 2013 has communicated that it proposes to disallow certain
costs which the Production Sharing Contract (PSC), relating to Block
KG-DWN-98/3 entitles the Company to recover. Based on legal advice
received, the Company continues to maintain that a Contractor is
entitled to recover all of its costs under the terms of the PSC and
there are no provisions that entitle the Government to disallow the
recovery of any Contract Cost as defined in the PSC. The Company has
already referred the issue to arbitration and already communicated the
same toGol for the resolution of dispute.
5. The figures for the previous year include figures of Reliance
Jamnagar Infrastructure Limited, the wholly owned subsidiary company
engaged in infrastructure development and maintenance developer of the
operating Special Economic Zone, which was amalgamated with the Company
with effect from 1st April, 2011 as per the Scheme of Amalgamation (the
Scheme) sanctioned by the Honble High Court of Gujarat at Ahmedabad.
The Scheme became effective on 22nd October, 2012, the appointed date
of the Scheme being 1st April, 2011.
In accordance with the scheme and as preapproval of the High Court:
a) The assets, liabilities, reserves, rights and obligations of
erstwhile Reliance Jamnagar Infrastructure Limited have been
transferred to and vested with the Company with effect from 1st April,
2011 and have been recorded at their respective book values, under the
pooling of interest method of accounting for amalgamation as prescribed
in Accounting Standard 14 on Accounting for Amalgamations.
b) Being a wholly owned subsidiary company, 10,00,00,000 equity shares
& 18,50,000,10% non-cumulative optionally convertible preference shares
of erstwhile Reliance Jamnagar Infrastructure Limited held by the
Company have been cancelled against Share Capital of the amalgamating
company and no shares have been issued in pursuance to the scheme of
amalgamation.
c) Amount added on amalgamation to profit and loss account of previous
year is inclusive of profit for the period 1st April 2011 till 31 st
March 2012 and is net of stamp duty paid on amalgamation.
6. CONTINGENT LIABILITIES AND COMMITMENTS (Rs. In crore)
As at As at
31st March,
2014 31st March,
2013
(I) Contingent Liabilities
(A) Claims against the company/disputed
liabilities not acknowledged as debts
(a) In respect of Joint Ventures 414 -
(b) In respect of others 1,433 1,663
(B) Guarantees
(i) Guarantees to Banks and Financial
Institutions against credit facilities
extended to third parties
(a) In respect of Joint Ventures
(b) In respect of others 32,308 31,080
(ii) Performance Guarantees
(a) In respect of Joint Ventures
(b) In respect of others 290 258
(iii) Outstanding guarantees furnished
to Banks and Financial Institutions
including in respect of Letters of
Credit
(a) In respect of Joint Ventures 700 160
(b) In respect of others 4,843 5,099
(C) Other Money for which the company
is contingently liable
(i) Liability in respect of bills
discounted with Banks (Including
third party bills discounting)
(a) In respect of Joint Ventures
(b) In respect of others 4,970 3,961
(II) Commitments
(A) Estimated amount of contracts
remaining to be executed on capital
account and not provided for:
(a) In respect of Joint Ventures 1,168 441
(b) In respect of others 25,349 7,948
(B) Other commitments
(a) Sales tax deferral liability
assigned 1,563 2,345
(b) Guarantee against future cash
calls* 2,917 1,645
* The Company has issued guarantees against future cash calls to be
made by JV Partners of its wholly owned subsidiary Reliance Marcellus
LLC.
(III) The Income-Tax assessments of the Company have been completed up
to Assessment Year 2010-11. The disputed demand outstanding up to the
said Assessment Year is Rs. 1,207 crore. Based on the decisions of the
Appellate authorities and the interpretations of other relevant
provisions, the Company has been legally advised that the demand is
likely to be either deleted or substantially reduced and accordingly no
provision is considered necessary.
b) Foreign Currency exposures that are not hedged by derivative
instruments as on 31st March 2014 amounting to Rs. 64,918 crore (Previous
Year Rs. 71,627 crore). The unheeded exposures are naturally hedged by
future foreign currency earnings and earnings linked to foreign
currency.
7. As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
8. The Ministry of Corporate Affairs, Government of India, vide
General Circular No. 2 and 3 dated 8th February 2011 and 21st February
2011 respectively read with General Circular No. 08/2014 dated 4th
April 2014 has granted a general exemption from compliance with section
212 of the Companies Act, 1956, subject to fulfillment of conditions
stipulated in the circular. The Company has satisfied the conditions
stipulated in the circular and hence is entitled to the exemption.
Necessary information relating to the subsidiaries has been included in
the Consolidated Financial Statements.
Mar 31, 2013
1.1 162,67,93,078 Shares were allotted as Bonus Shares in the last five
years by capitalisation of Securities Premium (162,67,93,078) and
Reserves.
1.2 6,92,52,623 Shares were allotted in the last five years pursuant to
the various Schemes of amalgamation (12,93,93,183) without payments
being received in cash.
1.3 45,04,27,345 Shares were allotted on conversion / surrender of
Debentures and Bonds, conversion of Term (45,04,27,345) Loans, exercise
of warrants, against Global Depository Shares (GDS) and re-issue of
forfeited equity shares, since inception.
1.4 17,18,83,624 Shares held by Subsidiaries do not have Voting Rights
and are not eligible for Bonus Shares (17,18,83,624)
1.5 4,62,46,280 Shares were bought back and extinguished in the last
five years. (36,63,431)
1.6 The Company has reserved issuance of 13,37,43,590 (Previous year
13,39,30,481) Equity Shares of Rs. 10 each for offering to eligible
employees of the Company and its subsidiaries under Employees Stock
Option Scheme (ESOS). During the year, the Company has not granted any
options to the eligible employees [Previous year 68,817 options, which
includes 4,100 options at a price of Rs. 972 per option, 18,000 options
at a price of Rs. 871 per option, 23,717 options at a price of Rs. 847
per option, 15,000 options at a price of Rs. 765 per option and 8,000
options at a price of Rs. 715 per option plus all applicable taxes, as
may be levied in this regard on the Company]. The options would vest
over a maximum period of 7 years or such other period as may be decided
by the Employees Stock Compensation Committee from the date of grant
based on specified criteria.
1.7 Share application money pending allotment represents application
money received on account of employees stock option scheme.
2.1 Non Convertible Debentures referred above to the extent of:
a) Rs. 1,593 crore are secured by way of first mortgage / charge on the
immovable properties situated at Hazira Complex and at Jamnagar Complex
(other than SEZ units) of the Company.
b) Rs. 2,500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (other than SEZ
units) of the Company.
c) Rs. 1,300 crore are secured by way of first mortgage / charge on all
the properties situated at Hazira Complex and at Patalganga Complex of
the Company.
d) Rs. 50 crore are secured by way of first mortgage / charge on
certain properties situated at Ahmedabad in the State of Gujarat and on
fixed assets situated at Nagpur Complex of the Company.
e) Rs. 30 crore are secured by way of first mortgage / charge on
certain properties situated at Surat in the State of Gujarat and on
fixed assets situated at Allahabad Complex of the Company.
f) Rs. 51 crore are secured by way of first mortgage / charge on
movable and immovable properties situated at Thane in the State of
Maharashtra and on movable properties situated at Baulpur Complex of
the Company.
g) Rs. 500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (SEZ unit) of the
Company.
2.2 Bonds include, 5.875% Senior Perpetual Notes (the "Notes") of Rs.
4,343 crore. The Notes have no fixed maturity date and the Company will
have an option, from time to time, to redeem the Notes, in whole or in
part, on any semi- annual interest payment date on or after February 5,
2018 at 100% of the principal amount plus accrued interest.
3. Working capital loans are secured by hypothecation of present and
future stock of raw materials, stock-in-process, finished goods, stores
and spares (not relating to plant and machinery), book debts,
outstanding monies, receivables, claims, bills, materials in transit,
etc. save and except receivables of Oil and Gas Division.
* Includes statutory dues, security deposit and advance from customers.
# These figures do not include any amounts, due and outstanding, to be
credited to Investor Education and Protection Fund except Rs. 10 crore
(Previous Year Rs. 9 crore) which is held in abeyance due to legal
cases pending.
# The Company had recognised liability based on substantial degree of
estimation for excise duty payable on clearance of goods lying in stock
as on 31st March, 2012 of Rs. 326 crore as per the estimated pattern of
despatches. During the year, Rs. 326 crore was utilised for clearance
of goods. Provision recognised under this class for the year is Rs. 336
crore which is outstanding as on 31st March, 2013. Actual outflow is
expected in the next financial year. The Company had recognised customs
duty liability on goods imported of Rs. 704 crore as at 31st March,
2012. During the year, further provision of Rs. 339 crore was made and
sum of Rs. 296 crore was reversed on fulfillment of export obligation.
Closing balance on this account as at 31st March, 2013 is Rs. 747
crore. Other class of provisions where recognition is based on
substantial degree of estimation relate to disputed customer / supplier
/ third party claims, rebates or demands against the Company. Any
additional information in this regard can be expected to seriously
prejudice the position of the Company.
4. Leasehold Land includes Rs. 203 crore (Previous Year RS. 203 crore)
in respect of which lease-deeds are pending execution.
4.1 Buildings include :
i) Cost of shares in Co-operative Housing Societies Rs. 1 crore
(Previous Year Rs. 1 crore).
ii) Rs. 5 crore (Previous Year Rs. 5 crore) in respect of which
conveyance is pending.
iii) Rs. 93 crore (Previous Year Rs. 93 crore) in shares of Companies /
Societies with right to hold and use certain area of Buildings.
4.2 Intangible assets - Others include :
i) Jetties amounting to Rs. 812 crore (Previous Year Rs. 812 crore),
the Ownership of which vests with Gujarat Maritime Board. However,
under an agreement with Gujarat Maritime Board, the Company has been
permitted to use the same at a concessional rate.
ii) Rs. 8,367 crore (Previous Year Rs. 8,387 crore) in preference
shares of subsidiaries and lease premium paid with right to hold and
use Land and Buildings.
4.3 Capital Work-in-Progress and Intangible Assets under development
include :
i) Rs. 2,795 crore (Previous Year Rs. 2,320 crore) on account of
project development expenditure.
ii) Rs. 4,685 crore (Previous Year Rs. 933 crore) on account of cost of
construction materials at site.
4.4 Gross Block includes Rs. 12,901 crore added on revaluation of
Building, Plant & Machinery and Equipments as at 01.01.2009 based on
reports issued by international values.
4.5 Additions in Plant and Machinery, Capital Work-in-Progress,
Intangible Assets - Development Rights and Intangible Assets under
development includes Rs. 5,070 crore (net loss) [Previous Year Rs.
7,558 crore (net loss)] on account of exchange difference during the
year.
4.6 The Gross Block of Fixed Assets includes RS. 38,122 crore (Previous
Year Rs. 38,122 crore) on account of revaluation of Fixed Assets
carried out since inception. Consequent to the said revaluation there
is an additional charge of depreciation of RS. 2,072 crore (Previous
Year RS. 2,340 crore) and an equivalent amount has been withdrawn from
Revaluation Reserve and credited to the Profit and Loss Account. This
has no impact on profit for the year.
4.7 Additions for the year includes freehold land Rs. 56 crore,
buildings Rs. 674 crore, plant and machinery Rs. 1,189 crore, furniture
and fixtures Rs. 12 crore, vehicles Rs. 10 crore and software Rs. 1
crore on amalgamation of Reliance Jamnagar Infrastructure Limited with
the Company. Accumulated depreciation of Rs. 603 crore on the above
assets has included in depreciation for the year. (Refer Note No. 33)
The Company''s Provident Fund is exempted under section 17 of Employees''
Provident Fund and Miscellaneous Provisions Act, 1952. Conditions for
grant of exemption stipulate that the employer shall make good
deficiency, if any, in the interest rate declared by the trust
vis-a-vis statutory rate.
Defined Benefit Plan
The employees'' gratuity fund scheme managed by a Trust (Life Insurance
Corporation of India for SEZ unit of the Company) is a defined benefit
plan. The present value of obligation is determined based on actuarial
valuation using the Projected Unit Credit Method, which recognises each
period of service as giving rise to additional unit of employee benefit
entitlement and measures each unit separately to build up the final
obligation. The obligation for leave encashment is recognised in the
same manner as gratuity.
The estimates of rate of escalation in salary considered in actuarial
valuation, take into account inflation, seniority, promotion and other
relevant factors including supply and demand in the employment market.
The above information is certified by the actuary.
The expected rate of return on plan assets is determined considering
several applicable factors, mainly the composition of Plan assets held,
assessed risks, historical results of return on plan assets and the
Company''s policy for plan assets management.
5. The Company had announced Voluntary Separation Scheme (VSS) for
the employees during the previous year. A sum of Rs. NIL (Previous Year
Rs. 5 crore) has been paid during the year and debited to Statement of
Profit and Loss under the head "Employee Benefits Expense".
5.1 A sum of Rs. 3 crore [Previous Year Rs. 1 crore is included under
establishment expenses representing Net Prior Period Items.
6. REMITTANCE IN FOREIGN CURRENCY ON ACCOUNT OF DIVIDEND
The Company has paid dividend in respect of shares held by
Non-Residents on repatriation basis. This inter-alia includes portfolio
investment and direct investment, where the amount is also credited to
Non-Resident External Account (NRE A/c). The exact amount of dividend
remitted in foreign currency cannot be ascertained. The total amount
remittable in this respect is given herein below:
7. Fixed assets taken on finance lease prior to 1st April, 2001,
amount to Rs. 444 crore (Previous Year Rs. 444 crore). Future
obligations towards lease rentals under the lease agreements as on 31st
March, 2013 amount to Rs. 2 crore (Previous Year Rs. 3 crore).
Disclosure in Respect of Material Related Party Transactions during the
year :
1. Purchase of Fixed Assets include Reliance Fresh Limited Rs. 1 crore
(Previous Year Rs. 2 crore), Reliance Industrial Infrastructure Limited
Rs. 2 crore (Previous Year Rs. 1 crore), Reliance Jamnagar
Infrastructure Limited Rs. NIL (Previous Year Rs. 2 crore),
Reliancedigital Retail Limited Rs. 4 crore (Previous Year Rs. 1 crore),
Reliance Ports and Terminals Limited Rs. 41 crore (Previous Year Rs.
104 crore), Reliance Footprint Limited RS. 1 crore (Previous Year Rs.
NIL), Reliance Security Solutions Limited Rs. 3 crore (Previous Year
Rs. NIL), Reliance Haryana SEZ Limited Rs. 43 crore (Previous Year Rs.
NIL).
2. Purchase / Subscription of Investments include Reliance Exploration
& Production DMCC Rs. NIL (Previous Year Rs. 558 crore), Reliance
Exploration & Production Mauritius Limited Rs. NIL (Previous Year Rs.
348 crore), Reliance Oil & Gas Mauritius Limited Rs. NIL (Previous Year
Rs. 95 crore), Reliance Jio Infocomm Limited Rs. 2,647 crore (Previous
Year Rs. 642 crore), Reliance Retail Limited Rs. NIL (Previous Year Rs.
2,580 crore ), RIL (Australia) Pty Limited Rs. 3 crore (Previous Year
Rs. 2 crore), Reliance Commercial Associates Limited Rs. 5,667 crore
(Previous Year Rs. NIL).
3. Sale / Transfer of Investments include to Reliance Energy
Generation and Distribution Limited Rs. NIL (Previous Year Rs. 3,265
crore), Reliance Industrial Investments and Holdings Limited Rs. 1,544
crore (Previous Year Rs. NIL), Reliance Universal Ventures Limited Rs.
7,800 crore (Previous Year Rs. NIL).
Redemption of Investments by Reliance Global Business B.V Rs. 49 crore
(Previous Year Rs. NIL), Reliance Industries (Middle East) DMCC Rs. 431
crore (Previous Year Rs. NIL), Reliance Exploration & Production DMCC
Rs. 1,673 crore (Previous Year Rs. NIL), Reliance Netherlands B.V Rs. 1
crore (Previous Year Rs. NIL).
4. Capital Advances given include Reliance Haryana SEZ Limited Rs. NIL
(Previous Year Rs. 42 crore), Reliance Industrial Infrastructure
Limited Rs. 2 crore (Previous Year Rs. NIL).
5. Loans given during the year include Reliance Industrial Investments
and Holdings Limited Rs. 7,684 crore (Previous Year Rs. 2,625 crore),
Reliance Retail Limited Rs. 303 crore (Previous Year RS. 617 crore),
Reliance Exploration & Production DMCC Rs. 71 crore (Previous Year Rs.
NIL), Reliance Brands Limited Rs. 11 crore (Previous Year Rs. NIL).
Deposits given during the year include Gujarat Chemical Port Terminal
Company Limited Rs. 27 crore (Previous Year Rs. 17 crore). Loans
returned during the year include Gapco Tanzania Limited Rs. NIL
(Previous Year Rs. 84 crore), Reliance Exploration & Production DMCC
Rs. NIL (Previous Year Rs. 8 crore).
Advances in the nature of application money returned during the year
Reliance Prolific Traders Private Limited Rs. 523 crore (Previous Year
Rs. NIL).
6. Revenue from Operations include to Reliance Jamnagar Infrastructure
Limited Rs. NIL (Previous Year Rs. 1 crore), Reliance Retail Limited
Rs. NIL (Previous Year Rs. 6 crore), Gapco Kenya Limited Rs. 6,559
crore (Previous Year Rs. 4,559 crore), Gapco Tanzania Limited RS. 2,937
crore (Previous Year Rs. 526 crore), Recron (Malaysia) Sdn Bhd Rs. 367
crore (Previous Year Rs. 124 crore), Reliance Trends Limited Rs. 6
crore (Previous Year Rs. 5 crore), LPG Infrastructure (India) Limited
Rs. 392 crore (Previous Year Rs. 269 crore), Reliance Petro Marketing
Limited Rs. 77 crore (Previous Year Rs. 216 crore), RIL USA Inc. Rs.
14,242 crore (Previous Year RS. 12,572 crore), Reliance Industrial
Investments and Holdings Limited Rs. 679 crore (Previous Year Rs. 733
crore), Reliance Fresh Limited RS. 9 crore (Previous Year Rs. 6 crore),
Reliance Gems and Jewels Limited Rs. 475 crore (Previous Year Rs. 504
crore), Reliance Utilities Private Limited Rs. NIL (Previous Year Rs.
145 crore), Reliance Utilities and Power Private Limited Rs. 243 crore
(Previous Year RS. NIL), Reliance Ports and Terminals Limited Rs. 6
crore (Previous Year RS. 20 crore), Reliance Gas Transportation
Infrastructure Limited RS. 86 crore (Previous Year Rs. 147 crore),
Reliance Corporate IT Park Limited Rs. 2 crore (Previous Year RS. 5
crore), Reliance Industries (Middle East) DMCC Rs. NIL (Previous Year
Rs. 100 crore), Reliance Jio Infocomm Limited Rs. 408 crore (Previous
Year Rs. 35 crore), Reliance digital Retail Limited Rs. 4 crore
(Previous Year Rs. NIL), Reliance Progressive Traders Private Limited
Rs. 5 crore (Previous Year Rs. NIL), Reliance Prolific Traders Private
Limited Rs. 1 crore (Previous Year Rs. NIL), Reliance Eminent Trading &
Commercial Private Limited RS. 2 crore (Previous Year Rs. NIL), Gujarat
Chemical Port Terminal Company Limited Rs. 1 crore (Previous Year Rs.
NIL).
7. Other Income from Reliance Industrial Investments and Holdings
Limited Rs. 371 crore (Previous Year Rs. 315 crore), Reliance Ventures
Limited Rs. 108 crore (Previous Year Rs. 40 crore), Reliance Strategic
Investments Limited Rs. 86 crore (Previous Year Rs. 71 crore), Reliance
Exploration & Production DMCC Rs. 2 crore (Previous Year Rs. NIL),
Gapco Kenya Limited Rs. 2 crore (Previous Year Rs. 4 crore), Gapco
Tanzania Limited Rs. 2 crore (Previous Year RS. 4 crore), Recron
(Malaysia) Sdn Bhd RS. 6 crore (Previous Year Rs. 7 crore), Reliance
Jio Infocomm Limited Rs. 41 crore (Previous Year Rs. 39 crore),
Reliance Retail Limited Rs. 72 crore (Previous Year Rs. 16 crore), RIL
USA Inc. Rs. 25 crore (Previous Year RS. 18 crore), Reliance Holdings
USA Inc. Rs. 122 crore (Previous Year Rs. 132 crore), Reliance
Eagleford Upstream Holding LP RS. NIL (Previous Year Rs. 2 crore),
Reliance Marcellus LLC Rs. 3 crore (Previous Year Rs. 10 crore),
Reliance Corporate IT Park Limited Rs. 1 crore (Previous Year Rs. 3
crore), Reliance Industrial Infrastructure Limited Rs. NIL (Previous
Year Rs. 2 crore), Reliance Europe Limited Rs. 5 crore (Previous Year
Rs. 5 crore), Gapco Uganda Limited Rs. 1 crore (Previous Year Rs. 1
crore), Reliance Gems and Jewels Limited Rs. NIL (Previous Year Rs. 11
crore), Reliance Utilities and Power Private Limited Rs. 3 crore
(Previous Year Rs. NIL), Reliance Ports and Terminals Limited Rs. 1
crore (Previous Year Rs. NIL).
8. Purchases / material consumed from Recron (Malaysia) Sdn Bhd Rs. 1
crore (Previous Year Rs. 2 crore), Reliance Petro Marketing Limited Rs.
2 crore (Previous Year Rs. 3 crore), Reliance Jamnagar Infrastructure
Limited Rs. NIL (Previous Year Rs. 350 crore), Reliance Ports and
Terminals Limited Rs. 154 crore (Previous Year Rs. 138 crore), Reliance
Industrial Infrastructure Limited Rs. 12 crore (Previous Year Rs. 11
crore), Reliance Footprint Limited Rs. 2 crore (Previous Year Rs. 2
crore), Gujarat Chemical Port Terminal Company Limited Rs. 1 crore
(Previous Year Rs. 2 crore), Reliance Industries (Middle East) DMCC Rs.
2,314 crore (Previous Year Rs. NIL).
9. Electric Power, Fuel and Water charges paid to Reliance Utilities
and Power Private Limited Rs. 1,325 crore (Previous Year Rs. 369
crore), Reliance Utilities Private Limited Rs. NIL (Previous Year Rs.
771 crore).
10. Hire Charges paid to Reliance Industrial Infrastructure Limited
Rs. 30 crore (Previous Year Rs. 21 crore), Gujarat Chemical Port
Terminal Company Limited Rs. 57 crore (Previous Year Rs. 66 crore),
Reliance Gas Transportation Infrastructure Limited Rs. 196 crore
(Previous Year Rs. 235 crore), Reliance Ports and Terminals Limited Rs.
125 crore (Previous Year Rs. 86 crore), Reliance Corporate IT Park
Limited Rs. NIL (Previous Year Rs. 1 crore).
11. Employee Benefits Expense include to Reliance People Serve Limited
Rs. 3 crore (Previous Year Rs. 3 crore), Reliance Fresh Limited Rs. 3
crore (Previous Year Rs. 20 crore), Reliance Polyolefins Limited Rs.
NIL (Previous Year Rs. 5 crore), Reliance Trends Limited Rs. NIL
(Previous Year Rs. 1 crore).
12. Payment to Key Managerial Personnel include to Shri Mukesh D.
Ambani Rs. 15 crore (Previous Year Rs. 15 crore), Shri Nikhil R.
Meswani Rs. 11 crore (Previous Year Rs. 11 crore), Shri Hital R.
Meswani Rs. 11 crore (Previous Year Rs. 11 crore), Shri P.M.S. Prasad
Rs. 5 crore (Previous Year Rs. 5 crore), Shri P.K. Kapil RS. 2 crore
(Previous Year Rs. 2 crore).
13. Sales and Distribution Expenses include to Reliance Fresh Limited
Rs. NIL (Previous Year Rs. 43 crore), Reliance Ports and Terminals
Limited Rs. 2,835 crore (Previous Year RS. 2,370 crore), Gujarat
Chemical Port Terminal Company Limited Rs. 10 crore (Previous Year Rs.
11 crore), Reliance Jamnagar Infrastructure Limited Rs. NIL (Previous
Year Rs. 7 crore), Gapco Kenya Limited Rs. NIL (Previous Year Rs. 3
crore ), Reliance Commercial Land and Infrastructure Limited Rs. 5
crore (Previous Year Rs. NIL), Reliance Polyolefins Limited Rs. 16
crore (Previous Year Rs. NIL).
14. Rent paid to Reliance Jamnagar Infrastructure Limited Rs. NIL
(Previous Year Rs. 29 crore).
15. Professional Fees paid to Reliance Supply Chain Solutions Limited
Rs. NIL (Previous Year Rs. 18 crore), Reliance Corporate IT Park
Limited Rs. 736 crore (Previous Year Rs. 240 crore), Reliance
Netherlands B.V Rs. NIL (Previous Year RS. 1 crore), Reliance Europe
Limited Rs. 37 crore (Previous Year RS. 27 crore), GenNext Ventures LLP
Rs. NIL (Previous Year Rs. 2 crore), Reliance Industrial Infrastructure
Limited Rs. 19 crore (Previous Year Rs. 9 crore), Reliance Security
Solutions Limited Rs. 1 crore (Previous Year Rs. NIL), Indiawin Sports
Private Limited Rs. 23 crore (Previous Year Rs. NIL).
16. General Expenses include to Reliance Fresh Limited Rs. 14 crore
(Previous Year Rs. 11 crore), Reliance Trends Limited Rs. 6 crore
(Previous Year Rs. 3 crore), Reliance Gems and Jewels Limited Rs. 7
crore (Previous Year Rs. 7 crore), Reliance digital Retail Limited Rs. 1
crore (Previous Year Rs. 3 crore), India win Sports Private Limited Rs.
12 crore (Previous Year Rs. 14 crore), Reliance Commercial Dealers
Limited Rs. 258 crore.
17. Donations to Dhirubhai Ambani Foundation Rs. 1 crore (Previous
Year Rs. 86 crore), Jamnaben Hirachand Ambani Foundation Rs. 8 crore
(Previous Year Rs. 8 crore), HNH Trust and HNH Research Society Rs. 2
crore (Previous Year Rs. 3 crore), Hirachand Govardhandas Ambani Public
Charitable Trust Rs. 1 crore (Previous Year Rs. 1 crore), Reliance
Foundation Rs. 206 crore (Previous Year Rs. 112 crore).
18. Finance Costs include to Reliance Corporate IT Park Limited Rs. 16
crore (Previous Year Rs. 18 crore).
19. Loans and Advances include Reliance Industrial Investments and
Holdings Limited Rs. 17,642 crore (Previous Year Rs. 9,905 crore),
Reliance Retail Limited Rs. 928 crore (Previous Year RS. 621 crore),
Reliance Strategic Investments Limited Rs. NIL (Previous Year Rs. 22
crore), Gapco Kenya Limited Rs. 2 crore (Previous Year Rs. 2 crore),
Gapco Tanzania Limited Rs. 2 crore (Previous Year Rs. 2 crore), Gapco
Uganda Limited Rs. 1 crore (Previous Year RS. 1 crore), Reliance Jio
Infocomm Limited RS. NIL (Previous Year Rs. 10 crore), Recron
(Malaysia) Sdn Bhd Rs. 6 crore (Previous Year Rs. 7 crore), Reliance
Europe Limited Rs. 8 crore (Previous Year Rs. 12 crore), RIL USA Inc.
Rs. NIL (Previous Year Rs. 2 crore), Reliance Holding USA Inc. Rs. NIL
(Previous Year Rs. 18 crore), Reliance Marcellus LLC Rs. NIL (Previous
Year RS. 2 crore), Reliance Energy Generation and Distribution Limited
RS. 3,265 crore (Previous Year Rs. 3,265 crore), Reliance Exploration &
Production DMCC Rs. 72 crore (Previous Year RS. NIL), Reliance
Corporate IT Park Limited Rs. 3 crore (Previous Year Rs. 20 crore),
Reliance Prolific Traders Private Limited (Application Money) Rs. NIL
(Previous Year Rs. 523 crore), Reliance Ventures Limited Rs. 42 crore
(Previous Year Rs. NIL), Reliance Brands Limited Rs. 11 crore (Previous
Year Rs. NIL).
20. Deposits include Reliance Jamnagar Infrastructure Limited Rs. NIL
(Previous Year Rs. 299 crore), Gujarat Chemical Port Terminal Company
Limited Rs. 69 crore (Previous Year Rs. 42 crore), Reliance Utilities
and Power Private Limited Rs. 350 crore (Previous Year Rs. 200 crore),
Reliance Ports and Terminals Limited Rs. 1,050 crore (Previous Year Rs.
1,050 crore), Reliance Utilities Private Limited RS. NIL (Previous Year
Rs. 150 crore).
(d) The Government of India, by its letter of 02 May 2012 has
communicated that it proposes to disallow certain costs which the PSC
relating to Block KG-DWN-98/3 entitles RIL to recover. RIL continues to
maintain that a Contractor is entitled to recover all of its costs
under the terms of the PSC and there are no provisions that entitle the
Government to disallow the recovery of any Contract Cost as defined in
the PSC. The Company has already initiated arbitration on the above
issue.
21. As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
22. The figures for the current year include figures of Reliance
Jamnagar Infrastructure Limited (RJIL), the wholly owned subsidiary
company engaged in infrastructure development and maintenance developer
of the operating Special Economic Zone, which is amalgamated with the
Company with effect from 1st April, 2011 as per the Scheme of
Amalgamation (the Scheme) sanctioned by the Humble High Court of
Gujarat at Ahmadabad, and are therefore to that extent not comparable
with those of previous year.
The Scheme became effective on 22nd October, 2012, the appointed date
of the Scheme being 1st April, 2011.
In accordance with the scheme and as per approval of the High Court:
a) The assets, liabilities, reserves, rights and obligations of
erstwhile RJIL have been transferred to and vested with the Company
with effect from 1st April, 2011 and have been recorded at their
respective book values, under the pooling of interest method of
accounting for amalgamation as prescribed in Accounting Standard
23. on Accounting for Amalgamations.
b) Being a wholly owned subsidiary company, 10,00,00,000 equity shares
& 18,50,000, 10% non-cumulative optionally convertible preference
shares of erstwhile RJIL held by the Company have been cancelled
against Share Capital of the amalgamating company and no shares has
been issued in pursuance to scheme of amalgamation.
c) Amount added on amalgamation to profit and loss account is inclusive
of profit for the period 1st April 2011 till 31st March 2012 and is net
of stamp duty paid on amalgamation.
(III) The Income-Tax assessments of the Company have been completed up
to Assessment Year 2010-11. The disputed demand outstanding up to the
said Assessment Year is Rs. 1,192 crore. Based on the decisions of the
Appellate authorities and the interpretations of other relevant
provisions, the Company has been legally advised that the demand is
likely to be either deleted or substantially reduced and accordingly no
provision has been made.
24. The Ministry of Corporate Affairs, Government of India, vide
General Circular No. 2 and 3 dated 8th February 2011 and 21st February
2011 respectively has granted a general exemption from compliance with
section 212 of the Companies Act, 1956, subject to fulfillment of
conditions stipulated in the circular. The Company has satisfied the
conditions stipulated in the circular and hence is entitled to the
exemption. Necessary information relating to the subsidiaries has been
included in the Consolidated Financial Statements.
Mar 31, 2012
1. The Company has reserved issuance of 13,39,30,481 (Previous year
13,52,79,244) Equity Shares of Rs 10/- each for offering to eligible
employees of the Company and its subsidiaries under Employees Stock
Option Scheme (ESOS). During the year, the Company has granted 68,817
[Previous year 35,200] Options to the eligible employees which includes
4,100 options at a price of Rs 972/- per option, 18,000 options at a
price of Rs 871/- per option, 23,717 options at a price of Rs 847 per
option, 15,000 options at a price of Rs 765 per option and 8,000 options
at a price of Rs 715 per option (Previous year, 16,000 options at a
price of Rs 995 per option and 19,200 options at a price of Rs 929 per
option) plus all applicable taxes, as may be levied in this regard on
the Company. The options would vest over a maximum period of 7 years or
such other period as may be decided by the Employees Stock Compensation
Committee from the date of grant based on specified criteria.
2. The Board of Directors of the Company approved the buyback of upto
12 crore fully paid up equity shares of Rs 10/- each, at a price not
exceeding Rs 870/- payable in cash, upto an aggregate amount not
exceeding Rs 10,440 crore from the open market through Stock
Exchange(s). During the year, the Company has bought back and
extinguished 36,63,431 Equity Shares of Rs 10/- each.
3. Non Convertible Debentures referred above to the extent of:
a) Rs 1,593 crore are secured by way of first mortgage / charge on the
immovable properties situated at Hazira Complex and at Jamnagar Complex
(other than SEZ unit) of the Company.
b) Rs 5,000 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (other than SEZ unit)
of the Company.
c) Rs 1,720 crore are secured by way of first mortgage / charge on all
the properties situated at Hazira Complex and at Patalganga Complex of
the Company.
d) Rs 110 crore are secured by way of first mortgage / charge on certain
properties situated at village Mouje Dhanot, District Kalol in the
State of Gujarat and on fixed assets situated at Hoshiarpur Complex of
the Company.
e) Rs 50 crore are secured by way of first mortgage / charge on certain
properties situated at Ahmedabad in the State of Gujarat and on fixed
assets situated at Nagpur Complex of the Company.
f) Rs 44 crore are secured by way of first mortgage / charge on certain
properties situated at Surat in the State of Gujarat and on fixed
assets situated at Allahabad Complex of the Company.
g) Rs 51 crore are secured by way of first mortgage / charge on movable
and immovable properties situated at Thane in the State of Maharashtra
and on movable properties situated at Baulpur Complex of the Company.
h) Rs 500 crore are secured by way of first mortgage / charge on the
immovable properties situated at Jamnagar Complex (SEZ unit) of the
Company.
# The Company had recognised liability based on substantial degree of
estimation for excise duty payable on clearance of goods lying in stock
as on 31st March, 2011 of Rs 345 crore as per the estimated pattern of
despatches. During the year, Rs 345 crore was utilised for clearance of
goods. Provision recognised under this class for the year is Rs 326
crore which is outstanding as on 31st March, 2012. Actual outflow is
expected in the next financial year. The Company had recognised customs
duty liability on goods imported under advance license of Rs 1,135 crore
as at 31st March, 2011. During the year, further provision of Rs 1,243
crore was made and sum of Rs 1,674 crore was reversed on fulfilment of
export obligation. Closing balance on this account as at 31st March,
2012 is Rs 704 crore. Other class of provisions where recognition is
based on substantial degree of estimation relate to disputed customer /
supplier / third party claims, rebates or demands against the Company.
Any additional information in this regard can be expected to seriously
prejudice the position of the Company.
4. Leasehold Land includes Rs 203 crore (Previous Year Rs 203 crore) in
respect of which lease-deeds are pending execution.
5. Buildings include :
i) Cost of shares in Co-operative Housing Societies Rs 1 crore (Previous
Year Rs 1 crore).
ii) Rs 5 crore (Previous Year Rs 5 crore) in respect of which conveyance
is pending.
iii) Rs 93 crore (Previous Year Rs 93 crore) in shares of Companies /
Societies with right to hold and use certain area of Buildings.
6. Intangible assets - Others include :
i) Jetties amounting to Rs 812 crore (Previous Year Rs 647 crore), the
Ownership of which vests with Gujarat Maritime Board. However, under an
agreement with Gujarat Maritime Board, the Company has been permitted
to use the same at a concessional rate.
ii) Rs 8,387 crore (Previous Year Rs 8,387 crore) in preference shares of
subsidiaries and lease premium paid with right to hold and use Land and
Buildings.
7. Capital Work-in-Progress and Intangible Assets under development
include :
i) Rs 2,320 crore (Previous Year Rs 1,886 crore) on account of project
development expenditure.
ii) Rs 933 crore (Previous Year Rs 666 crore) on account of cost of
construction materials at site.
8. Gross Block includes Rs 12,901 crore added on revaluation of
Building, Plant & Machinery and Equipments as at 01.01.2009 based on
reports issued by international valuers.
9. Additions in Plant and Machinery, Intangible Assets - Development
Rights and Intangible Assets under development includes Rs 7,558 crore
(net loss) [Previous Year Rs 121 crore (net loss)] on account of
exchange difference during the year.
10. The Gross Block of Fixed Assets includes Rs 38,122 crore (Previous
Year Rs 38,122 crore) on account of revaluation of Fixed Assets carried
out since inception. Consequent to the said revaluation there is an
additional charge of depreciation of Rs 2,340 crore (Previous Year Rs
2,633 crore) and an equivalent amount has been withdrawn from
Revaluation Reserve and credited to the Profit and Loss Account. This
has no impact on profit for the year.
B) (i) Investment by the loanee in the shares of the Company
*None of the loanees and loanees of subsidiary companies have, per se,
made investments in shares of the Company. These investments represent
shares of the Company allotted as a result of amalgamation of erstwhile
Reliance Petroleum Limited (amalgamation in 2001-02) and Indian
Petrochemicals Corporation Limited with the Company under the Schemes
approved by the Hon'ble High Court of Judicature at Bombay and Gujarat
and certain subsequent inter se transfer of shares.
11. The Company announced a Voluntary Separation Scheme (VSS) for the
employees of one of the units during the year. A sum of Rs 5 crore
(Previous Year Rs 3 crore) has been paid during the year and debited to
Statement of Profit and Loss under the head 'Employee Benefits
Expense'.
12. Fixed assets taken on finance lease prior to 1st April, 2001,
amount to Rs 444 crore (Previous Year Rs 512 crore). Future obligations
towards lease rentals under the lease agreements as on 31st March, 2012
amount to Rs 3 crore
Disclosure in Respect of Material Related Party Transactions during the
year :
1. Purchase of Fixed Assets include Reliance Fresh Limited Rs 2 crore
(Previous Year Rs NIL), Reliance Industrial Infrastructure Limited Rs 1
crore (Previous Year Rs NIL), Reliance Jamnagar Infrastructure Limited Rs
2 crore (Previous Year Rs NIL), Reliancedigital Retail Limited Rs 1 crore
(Previous Year Rs NIL), Reliance Ports and Terminals Limited Rs 104 crore
(Previous Year Rs NIL).
2. Purchase / Subscription of Investments include Reliance Industries
(Middle East) DMCC Rs NIL (Previous Year Rs 20 crore), Reliance
Exploration & Production DMCC Rs 558 crore (Previous Year Rs 440 crore)
(including conversion of share application money of Rs 11 crore into
Preference Shares), Reliance Global Business B.V. Rs NIL (Previous Year
Rs 101 crore), Reliance Exploration & Production Mauritius Limited Rs 348
crore (Previous Year Rs 2,208 crore), Reliance Oil & Gas Mauritius
Limited Rs 95 crore (Previous Year Rs 614 crore), Infotel Broadband
Services Limited Rs 642 crore (Previous Year Rs 4,156 crore) (including
conversion of share application money of Rs 46 crore into Equity
Shares), Reliance Retail Limited Rs 2,580 crore (Previous Year Rs NIL)
(including conversion of share application money of Rs 878 crore into
Preference Shares), RIL (Australia) Pty Limited Rs 2 crore (Previous
Year Rs 2 crore), Gujarat Chemicals Port Terminal Company Limited Rs NIL
(Previous Year Rs 52 crore).
3. Sale / Transfer of Investments include to Reliance Energy
Generation and Distribution Limited Rs 3,265 crore (Previous Year Rs
NIL).
4. Capital Advances given include Reliance Haryana SEZ Limited Rs 42
crore (Previous Year Rs NIL).
5. Loans given during the year include Reliance Industrial Investments
and Holdings Limited Rs 2,625 crore (Previous Year Rs 4,348 crore),
Gujarat Chemicals Port Terminal Company Limited Rs 17 crore (Previous
Year Rs 19 crore), Reliance Retail Limited Rs 617 crore (Previous Year Rs
NIL). Loans returned during the year include Gapco Tanzania Limited Rs
84 crore (Previous Year Rs 180 crore), Reliance Exploration & Production
DMCC Rs 8 crore (Previous Year Rs 15 crore), Reliance Gas Corporation
Limited Rs NIL (Previous Year Rs 6 crore), Reliance Corporate IT Park
Limited Rs NIL (Previous Year Rs 53 crore), Gujarat Chemicals Port
Terminal Company Limited Rs NIL (Previous Year Rs 17 crore). Advances in
the nature of application / call money advances to Reliance Retail
Limited Rs NIL (Previous Year Rs 726 crore), Infotel Broadband Services
Limited Rs NIL (Previous Year Rs 46 crore), Reliance Exploration &
Production DMCC Rs NIL (Previous Year Rs 11 crore), Reliance Prolific
Traders Private Limited Rs NIL (Previous Year Rs 523 crore).
6. Revenue from Operations include to Reliance Jamnagar Infrastructure
Limited Rs 1 crore (Previous Year Rs NIL), Reliance Retail Limited Rs 6
crore (Previous Year Rs 136 crore), Gapco Kenya Limited Rs 4,559 crore
(Previous Year Rs 3,750 crore), Gapco Tanzania Limited Rs 526 crore
(Previous Year Rs 750 crore), Recron (Malaysia) Sdn Bhd Rs 124 crore
(Previous Year Rs 41 crore), Reliance Trends Limited Rs 5 crore (Previous
Year Rs 3 crore), LPG Infrastructure (India) Limited Rs 269 crore
(Previous Year Rs 226 crore), Reliance Petro Marketing Limited Rs 216
crore (Previous Year Rs 809 crore), RIL USA Inc. Rs 12,572 crore
(Previous Year Rs 10,210 crore), Reliance Industrial Investments and
Holdings Limited Rs 733 crore (Previous Year Rs 948 crore), Reliance
Fresh Limited Rs 6 crore (Previous Year Rs 2 crore), Reliance Gems and
Jewels Limited Rs 504 crore (Previous Year Rs 59 crore), Reliance
Utilities Private Limited Rs 145 crore (Previous Year Rs NIL), Reliance
Ports and Terminals Limited Rs 20 crore (Previous Year Rs 5 crore),
Reliance Gas Transportation Infrastructure Limited Rs 147 crore
(Previous Year Rs 213 crore), Reliance Corporate IT Park Limited Rs 5
crore (Previous Year Rs NIL), Reliance Industries (Middle East) DMCC Rs
100 crore (Previous Year Rs NIL), Infotel Broadband Services Limited Rs
35 crore (Previous Year Rs NIL).
7. Other Income from Reliance Industrial Investments and Holdings
Limited Rs 315 crore (Previous Year Rs 884 crore), Reliance Ventures
Limited Rs 40 crore (Previous Year Rs 19 crore), Reliance Strategic
Investments Limited Rs 71 crore (Previous Year Rs 10 crore), Reliance
Jamnagar Infrastructure Limited Rs NIL (Previous Year Rs 2 crore),
Reliance Exploration & Production DMCC Rs NIL (Previous Year Rs 1 crore),
Gapco Kenya Limited Rs 4 crore (Previous Year Rs 2 crore), Gapco Tanzania
Limited Rs 4 crore (Previous Year Rs 8 crore), Recron (Malaysia) Sdn Bhd
Rs 7 crore (Previous Year Rs 5 crore), Infotel Broadband Services Limited
Rs 39 crore (Previous Year Rs 13 crore), Reliance Retail Limited Rs 16
crore (Previous Year Rs 3 crore), RIL USA Inc. Rs 18 crore (Previous Year
Rs 13 crore), Reliance Holdings USA Inc. Rs 132 crore (Previous Year Rs 60
crore), Reliance Eagleford Upstream Holding LP Rs 2 crore (Previous Year
Rs 2 crore), Reliance Marcellus LLC Rs 10 crore (Previous Year Rs 9
crore), Reliance Corporate IT Park Limited Rs 3 crore (Previous Year Rs 6
crore), Reliance Industrial Infrastructure Limited Rs 2 crore (Previous
Year Rs 2 crore), Reliance Europe Limited Rs 5 crore (Previous Year Rs 3
crore), Gapco Uganda Limited Rs 1 crore (Previous Year Rs NIL), Reliance
Gems and Jewels Limited Rs 11 crore (Previous Year Rs NIL).
8. Purchases / material consumed from Recron (Malaysia) Sdn Bhd Rs 2
crore (Previous Year Rs 6 crore), Reliance Petro Marketing Limited Rs 3
crore (Previous Rs 108 crore), Reliance Jamnagar Infrastructure Limited
Rs 350 crore (Previous Year Rs 392 crore), Reliance Ports and Terminals
Limited Rs 138 crore (Previous Year Rs 1 crore), Reliance
Industrial Infrastructure Limited Rs 11 crore (Previous Year Rs NIL),
Reliance Footprint Limited Rs 2 crore (Previous Year Rs NIL), Gujarat
Chemicals Port Terminal Company Limited Rs 2 crore (Previous Year Rs
NIL).
9. Electric Power, Fuel and Water charges paid to Reliance Utilities
and Power Private Limited Rs 369 crore (Previous Year Rs 292 crore),
Reliance Utilities Private Limited Rs 771 crore (Previous Year Rs 625
crore).
10. Hire Charges paid to Reliance Industrial Infrastructure Limited Rs
21 crore (Previous Year Rs 22 crore), Gujarat Chemicals Port Terminal
Company Limited Rs 66 crore (Previous Year Rs 44 crore), Reliance Gas
Transportation Infrastructure Limited Rs 235 crore (Previous Year Rs 652
crore), Reliance Ports and Terminals Limited Rs 86 crore (Previous Year
Rs 72 crore), Reliance Corporate IT Park Limited Rs 1 crore (Previous
Year Rs NIL).
11. Employee Benefits Expense to Reliance Retail Limited Rs NIL
(Previous Year Rs 33 crore), Reliance People Serve Limited Rs 3 crore
(Previous Year Rs 2 crore), Strategic Manpower Solutions Limited Rs NIL
(Previous Year Rs 4 crore), Reliance Fresh Limited Rs 20 crore (Previous
Year Rs 2 crore), Reliance Industrial Infrastructure Limited Rs NIL
(Previous Year Rs 21 crore), Reliance Polyolefins Limited Rs 5 crore
(Previous Year Rs NIL), Reliance Trends Limited Rs 1 crore (Previous Year
Rs NIL).
12. Payment to Key Management Personnel include to Shri Mukesh D.
Ambani Rs 15 crore (Previous Year Rs 15 crore), Shri Nikhil R. Meswani Rs
11 crore (Previous Year Rs 11 crore), Shri Hital R. Meswani Rs 11 crore
(Previous Year Rs 11 crore), Shri P.M.S. Prasad Rs 5 crore (Previous Year
Rs 2 crore), Shri P.K. Kapil Rs 2 crore (Previous Year Rs 2 crore).
13. Sales and Distribution Expenses include to Reliance Fresh Limited
Rs 43 crore (Previous Year Rs 49 crore), Reliance Netherlands B.V. Rs NIL
(Previous Year Rs 1 crore), Reliance Ports and Terminals Limited Rs 2,370
crore (Previous Year Rs 2,562 crore), Gujarat Chemicals Port Terminal
Company Limited Rs 11 crore (Previous Year Rs 10 crore), Reliance
Jamnagar Infrastructure Limited Rs 7 crore (Previous Year Rs NIL), Gapco
Kenya Limited Rs 3 crore (Previous Year Rs NIL).
14. Rent paid to Reliance Jamnagar Infrastructure Limited Rs 29 crore
(Previous Year Rs NIL).
15. Professional Fees paid to Reliance Supply Chain Solutions Limited
Rs 18 crore (Previous Year Rs 9 crore), Reliance Corporate IT Park
Limited Rs 240 crore (Previous Year Rs 102 crore), Reliance Netherlands
B.V. Rs 1 crore (Previous Year Rs NIL), Reliance Europe Limited Rs 27
crore (Previous Year Rs 17 crore), GenNext Ventures LLP Rs 2 crore
(Previous Year Rs NIL), Reliance Industrial Infrastructure Limited Rs 9
crore (Previous Year Rs NIL).
16. General Expenses include to Reliance Hypermart Limited Rs NIL
(Previous Year Rs 2 crore), Reliance Retail Limited Rs NIL (Previous Year
Rs 8 crore), Reliance Footprint Limited Rs NIL (Previous Year Rs 2 crore),
Reliance Fresh Limited Rs 11 crore (Previous Year Rs 20 crore), Reliance
Polyolefins Limited Rs NIL (Previous Year Rs 4 crore), Reliance Trends
Limited Rs 3 crore (Previous Year Rs 3 crore), Reliance Gems and Jewels
Limited Rs 7 crore (Previous Year Rs 2 crore), Reliance Industrial
Infrastructure Limited Rs NIL (Previous Year Rs 9 crore), Reliancedigital
Retail Limited Rs 3 crore (Previous Year Rs NIL), Indiawin Sports Private
Limited Rs 14 crore (Previous Year Rs NIL).
17. Donations to Dhirubhai Ambani Foundation Rs 86 crore (Previous Year
Rs 18 crore), Jamnaben Hirachand Ambani Foundation Rs 8 crore (Previous
Year Rs 6 crore), HNH Trust and HNH Research Society Rs 3 crore (Previous
Year Rs 2 crore), Hirachand Govardhandas Ambani Public Charitable Trust
Rs 1 crore (Previous Year Rs NIL), Reliance Foundations Rs 112 crore
(Previous Year Rs NIL).
18. Finance Costs include to Reliance Corporate IT Park Limited Rs 18
crore (Previous Year Rs 19 crore).
19. Loans and Advances include Reliance Industrial Investments and
Holdings Limited Rs 9,905 crore (Previous Year Rs 7,792crore), Reliance
Retail Limited Rs 621 crore (Previous Year Rs 879 crore), Reliance
Strategic Investments Limited Rs 22 crore (Previous Year Rs NIL), Gapco
Kenya Limited Rs 2 crore (Previous Year Rs NIL), Gapco Tanzania Limited Rs
2 crore (Previous Year Rs 85 crore), Gapco Uganda Limited Rs 1 crore
(Previous Year Rs NIL), Infotel Broadband Services Limited Rs 10 crore
(Previous Year Rs 59 crore), Recron (Malaysia) Sdn Bhd Rs 7 crore
(Previous Year Rs 5 crore), Reliance Europe Limited Rs 12 crore (Previous
Year Rs 7 crore), RIL USA Inc. Rs 2 crore (Previous Year Rs 1 crore),
Reliance Holding USA Inc. Rs 18 crore (Previous Year Rs 60 crore),
Reliance Eagleford Upstream Holding LP Rs NIL (Previous Year Rs 2 crore),
Reliance Marcellus LLC Rs 2 crore (Previous Year Rs 9 crore), Reliance
Energy Generation and Distribution Limited Rs 3,265 crore (Previous Year
Rs NIL), Reliance Exploration and Production DMCC Rs NIL (Previous Year Rs
19 crore), Gujarat Chemicals Port Terminal Company Limited Rs NIL
(Previous Year Rs 25 crore), Reliance Corporate IT Park Limited Rs 20
crore (Previous Year Rs 44 crore), Reliance Prolific Traders Private
Limited (Application Money) Rs 523 crore (Previous Year Rs 523 crore).
20. Deposits includes Reliance Jamnagar Infrastructure Limited Rs 299
crore (Previous Year Rs 299 crore), Gujarat Chemicals Port Terminal
Company Limited Rs 42 crore (including conversion of loan given)
(Previous Year Rs NIL), Reliance Utilities and Power Private Limited Rs
200 crore (Previous Year Rs 200 crore), Reliance Ports and Terminals
Limited Rs 1,050 crore (Previous Year Rs 1,050 crore), Reliance Utilities
Private Limited Rs 150 crore (Previous Year Rs 150 crore).
21. The Ministry of Corporate Affairs, Government of India, vide
General Circular No. 2 and 3 dated 8th February 2011 and 21st February
2011 respectively has granted a general exemption from compliance with
section 212 of the Companies Act, 1956, subject to fulfillment of
conditions stipulated in the circular. The Company has satisfied the
conditions stipulated in the circular and hence is entitled to the
exemption. Necessary information relating to the subsidiaries has been
included in the Consolidated Financial Statements.
Mar 31, 2011
1. The previous years figures have been reworked, regrouped,
rearranged and reclassified wherever necessary. Amounts and other
disclosures for the preceding year are included as an integral part of
the current year financial statements and are to be read in relation to
the amounts and other disclosures relating to the current year.
Defined Benefit Plan
The employees gratuity fund scheme managed by a Trust (Life Insurance
Corporation of India for SEZ unit of the Company) is a defined benefit
plan. The present value of obligation is determined based on actuarial
valuation using the Projected Unit Credit Method, which recognises each
period of service as giving rise to additional unit of employee benefit
entitlement and measures each unit separately to build up the final
obligation. The obligation for leave encashment is recognised in the
same manner as gratuity.
3. Turnover includes Income from Services of Rs. 79.95 crore (Previous
Year Rs. 70.98 crore) and sales during trial run period of Rs. NIL
(Previous Year Rs. 143.26 crore).
4. The Gross Block of Fixed Assets includes Rs. 38,121.98 crore
(Previous Year Rs. 38,121.98 crore) on account of revaluation of Fixed
Assets carried out in the past. Consequent to the said revaluation
there is an additional charge of depreciation of Rs. 2,633.75 crore
(Previous Year Rs. 2,980.48 crore) and an equivalent amount, has been
withdrawn from Revaluation Reserve and credited to the Profit and Loss
Account. This has no impact on profit for the year.
5. The Company announced a Voluntary Separation Scheme (VSS) for the
employees of one of the units during the year. A sum of Rs. 2.58 crore
(Previous Year Rs. 19.56 crore) has been paid during the year and
debited to Profit and Loss Account under the head "Payments to and
Provisions for Employees".
8. A sum of Rs. 2.83 crore (net debit) [Previous Year Rs. 1.35 crore
(net debit)] is included under establishment expenses representing Net
Prior Period Items.
9. Pursuant to the scheme of arrangement to demerge certain
undertakings which was approved by the Honble High Court of Bombay on
9th December, 2005, the Company had demerged assets and liabilities
relatable to those demerged undertakings on the close of business on
31st August 2005. There have been certain claims relating to the above
demerger / demerged undertakings which have been settled by the Company
during the year and an additional amount of Rs. 703.52 crore has been
appropriated against Revaluation Reserve.
10. Expenditure on account of Premium on forward exchange contracts to
be recognised in the Profit and Loss account of subsequent accounting
period aggregates Rs. 55.37 crore (Previous Year Rs. 81.66 crore).
16. RELATED PARTY DISCLOSURES :
As per Accounting Standard 18, the disclosures of transactions with the
related parties as defined in the Accounting Standard are given below:
(i) List of related parties where control exists and related parties
with whom transactions have taken place and relationships:
Sr. No. Name of the Related Party Relationship
1 Reliance Industrial Investments and Holdings Limited
2 Reliance Ventures Limited
3 Reliance Strategic Investments Limited
4 Reliance Industries (Middle East) DMCC
5 Reliance Jamnagar Infrastructure Limited
6 Reliance Retail Limited
7 Reliance Netherlands B.V.
8 Reliance Haryana SEZ Limited
9 Reliance Fresh Limited
10 Retail Concepts and Services (India) Limited
11 Reliance Retail Insurance Broking Limited
12 Reliance Dairy Foods Limited
13 Reliance Exploration & Production DMCC
14 Reliance Retail Finance Limited
15 RESQ Limited
16 Reliance Global Management Services Limited (amalgamated with
Reliance Corporate IT Park Limited w.e.f. 01.04.2010)
17 Reliance Commercial Associates Limited
18 Reliancedigital Retail Limited
19 Reliance Financial Distribution and Advisory Services Limited
Subsidiary Companies
20 RIL (Australia) Pty Limited
21 Reliance Hypermart Limited
22 Gapco Kenya Limited
23 Gapco Rwanda SARL
24 Gapco Tanzania Limited
25 Gapco Uganda Limited
26 Gapoil (Zanzibar) Limited
27 Gapoil Tanzania Limited (amalgamated with Gapco Tanzania Limited
w.e.f. 01.08.2010)
28 Gulf Africa Petroleum Corporation
29 Transenergy Kenya Limited
30 Recron (Malaysia) Sdn Bhd
31 Reliance Retail Travel & Forex Services Limited
32 Reliance Brands Limited
33 Reliance Footprint Limited
34 Reliance Trends Limited
35 Reliance Wellness Limited
36 Reliance Lifestyle Holdings Limited
37 Reliance Universal Ventures Limited
38 Delight Proteins Limited
39 Reliance Autozone Limited
40 Reliance F&B Services Limited
41 Reliance Gems and Jewels Limited
42 Reliance Integrated Agri Solutions Limited
43 Strategic Manpower Solutions Limited
44 Reliance Agri Products Distribution Limited
45 Reliance Digital Media Limited
46 Reliance Food Processing Solutions Limited
47 Reliance Home Store Limited
48 Reliance Leisures Limited
49 Reliance Loyalty & Analytics Limited
50 Reliance Retail Securities and Broking Company Limited
51 Reliance Supply Chain Solutions Limited
52 Reliance Trade Services Centre Limited
53 Reliance Vantage Retail Limited
54 Wave Land Developers Limited
55 Reliance-Grand Optical Private Limited
56 Reliance Universal Commercial Limited
57 Reliance Petroinvestments Limited
58 Reliance Global Commercial Limited
59 Reliance People Serve Limited
60 Reliance Infrastructure Management Services Limited Subsidiary
Companies
61 Reliance Global Business, B.V.
62 Reliance Gas Corporation Limited
63 Reliance Global Energy Services Limited
64 Reliance One Enterprises Limited
65 Reliance Global Energy Services (Singapore) Pte. Ltd.
66 Reliance Personal Electronics Limited
67 Reliance Polymers (India) Limited
68 Reliance Polyolefins Limited
69 Reliance Aromatics and Petrochemicals Limited
70 Reliance Energy and Project Development Limited
71 Reliance Chemicals Limited
72 Reliance Universal Enterprises Limited
73 International Oil Trading Limited
74 Reliance Review Cinema Limited
75 Reliance Replay Gaming Limited
76 Reliance Nutritional Food Processors Limited
77 RIL USA Inc.
78 Reliance Commercial Land & Infrastructure Limited
79 Reliance Corporate IT Park Limited
80 Reliance Eminent Trading & Commercial Private Limited
81 Reliance Progressive Traders Private Limited
82 Reliance Prolific Traders Private Limited
83 Reliance Universal Traders Private Limited
84 Reliance Prolific Commercial Private Limited
85 Reliance Comtrade Private Limited
86 Reliance Ambit Trade Private Limited
87 Reliance Petro Marketing Limited
88 LPG Infrastructure (India) Limited
89 Reliance Infosolutions Private Limited
(amalgamated with Reliance Corporate IT Park Limited w.e.f. 01.04.2010)
90 Reliance Corporate Center Limited
91 Reliance Convention and Exhibition Center Limited
92 Central Park Enterprises DMCC
93 Reliance International B. V.
94 Reliance Corporate Services Limited
95 Reliance Oil and Gas Mauritius Limited
96 Reliance Exploration and Production Mauritius Limited
97 Reliance Holding Cooperatief U.A.
98 Indiawin Sports Private Limited
99 Reliance Holding Netherlands B. V.
100 Reliance International Gas B. V.
101 Reliance Exploration and Production B. V.
102 Reliance Exploration and Production Limited Subsidiary Companies
103 Reliance Holding USA Inc.
104 Reliance Marcellus LLC
105 Infotel Broadband Services Limited
106 Reliance Strategic (Mauritius) Limited
107 Reliance Eagleford Midstream LLC
108 Reliance Eagleford Upstream LLC
109 Reliance Eagleford Upstream GP LLC
110 Reliance Eagleford Upstream Holding LP
111 Mark Project Services Private Limited
112 Reliance Energy Generation and Distribution Limited
113 Reliance Marcellus II LLC
114 Reliance Security Solutions Limited
115 Reliance Industries Investment and Holding Limited
116 Reliance Office Solutions Private Limited
117 Reliance Style Fashion India Limited
118 GenNext Innovation Ventures Private Limited
119 GenNext Ventures Private Limited
120 Reliance Home Products Limited
121 Infotel Telecom Limited
122 Reliance Styles India Private Limited
123 Rancore Technologies Private Limited
124 Reliance Industrial Infrastructure Limited
125 Reliance Europe Limited
126 Reliance LNG Limited
127 Indian Vaccines Corporation Limited
128 Gujarat Chemicals Port Terminal Company Limited Associates
129 Reliance Utilities and Power Private Limited
130 Reliance Utilities Private Limited
131 Reliance Ports and Terminals Limited
132 Reliance Gas Transportation Infrastructure Limited
133 Shri Mukesh D. Ambani
134 Shri Nikhil R. Meswani
135 Shri Hital R. Meswani Key Managerial Personnel
136 Shri P.M.S. Prasad
137 Shri P.K.Kapil (w.e.f. 16th May 2010)
138 Dhirubhai Ambani Foundation Enterprises over which
139 Jamnaben Hirachand Ambani Foundation Key Managerial Personnel
140 Hirachand Govardhandas Ambani Public Charitable Trust are able to
exercise
141 HNH Trust and HNH Research Society significant influence
142 Reliance Foundation
Mar 31, 2010
1. The previous yearÃs figures have been reworked, regrouped,
rearranged and reclassified wherever necessary. Amounts and other
disclosures for the preceding year are included as an integral part of
the current year financial statements and are to be read in relation to
the amounts and other disclosures relating to the current year.
Defined Benefit Plan
The employeesà gratuity fund scheme managed by a Trust (Life Insurance
Corporation of India for SEZ unit of the Company) is a defined benefit
plan. The present value of obligation is determined based on actuarial
valuation using the Projected Unit Credit Method, which recognises each
period of service as giving rise to additional unit of employee benefit
entitlement and measures each unit separately to build up the final
obligation. The obligation for leave encashment is recognised in the
same manner as gratuity.
2. Turnover includes Income from Services of Rs. 70.98 crore (Previous
Year Rs. 59.96 crore) and sales during trial run period of Rs. 143.26
crore (Previous Year Rs. 2,604.53 crore).
3. The Gross Block of Fixed Assets includes Rs. 38,121.98 crore
(Previous Year Rs. 38,121.98 crore) on account of revaluation of Fixed
Assets carried out in the past. Consequent to the said revaluation
there is an additional charge of depreciation of Rs. 2,980.48 crore
(Previous Year Rs. 1,987.14 crore) and an equivalent amount, has been
withdrawn from Revaluation Reserve and credited to the Profit and Loss
Account. This has no impact on profit for the year.
4. The Company announced a Voluntary Separation Scheme (VSS) for the
employees of certain units during the year. A sum of Rs. 19.56 crore
(Previous Year Rs. 110.79 crore) has been paid during the year and
debited to Profit and Loss Account under the head ÃPayments to and
Provisions for EmployeesÃ.
5. A sum of Rs. 1.35 crore (net debit) [Previous Year Rs. 2.14 crore
(net debit)] is included under Establishment expenses representing Net
Prior Period Items.
6. Expenditure on account of Premium on forward exchange contracts to
be recognised in the Profit and Loss account of subsequent accounting
period aggregates Rs. 81.66 crore (Previous Year Rs. 9.28 crore).
7. (a) Fixed assets taken on finance lease prior to 1st April, 2001,
amount to Rs. 512.36 crore (Previous Year Rs. 512.36 crore). Future
obligations towards lease rentals under the lease agreements as on 31st
March, 2010 amount to Rs. 4.87 crore (Previous Year Rs. 5.45 crore).
8. RELATED PARTY DISCLOSURES :
As per Accounting Standard 18, the disclosures of transactions with the
related parties as defined in the Accounting Standard are given below:
(i) List of related parties where control exists and related parties
with whom transactions have taken place and relationships:
Sr. No. Name of the Related Party Relationship
1 Reliance Industrial Investments
and Holdings Limited
2 Reliance Ventures Limited
3 Reliance Strategic Investments Limited
4 Reliance Industries (Middle East) DMCC
5 Reliance Jamnagar Infrastructure Limited
6 Reliance Retail Limited
7 Reliance Netherlands B.V.
8 Reliance Haryana SEZ Limited
9 Reliance Fresh Limited
10 Retail Concepts and Services (India) Limited
11 Reliance Retail Insurance Broking Limited
12 Reliance Dairy Foods Limited
13 Reliance Exploration & Production DMCC
14 Reliance Retail Finance Limited
15 RESQ Limited
16 Reliance Global Management Services Limited Subsidiary
Companies
17 Reliance Commercial Associates Limited
18 Reliancedigital Retail Limited
19 Reliance Financial Distribution and Advisory Services Limited
20 RIL (Australia) Pty Limited
21 Reliance Hypermart Limited
22 Gapco Kenya Limited
23 Gapco Rwanda SARL
24 Gapco Tanzania Limited
25 Gapco Uganda Limited
26 Gapoil (Zanzibar) Limited
27 Gapoil Tanzania Limited
28 Gulf Africa Petroleum Corporation
29 Transenergy Kenya Limited
30 Recron (Malaysia) Sdn Bhd
31 Reliance Retail Travel & Forex Services Limited
32 Reliance Brands Limited
33 Reliance Footprint Limited
34 Reliance Trends Limited
35 Reliance Wellness Limited
36 Reliance Lifestyle Holdings Limited
37 Reliance Universal Ventures Limited
38 Delight Proteins Limited
39 Reliance Autozone Limited
40 Reliance F&B Services Limited
41 Reliance Gems and Jewels Limited
42 Reliance Integrated Agri Solutions Limited
43 Strategic Manpower Solutions Limited
44 Reliance Agri Products Distribution Limited
45 Reliance Digital Media Limited
46 Reliance Food Processing Solutions Limited
47 Reliance Home Store Limited
48 Reliance Leisures Limited
49 Reliance Loyalty & Analytics Limited
50 Reliance Retail Securities and Broking Company Limited
51 Reliance Supply Chain Solutions Limited
52 Reliance Trade Services Centre Limited
53 Reliance Vantage Retail Limited
54 Reliance International Exploration and Production Inc.
55 Wave Land Developers Limited
56 Reliance-GrandOptical Private Limited Subsidiary
Companies
57 Reliance Universal Commercial Limited
58 Reliance Petroinvestments Limited
59 Reliance Global Commercial Limited
60 Reliance Cyprus Limited
61 Reliance People Serve Limited
62 Reliance Infrastructure Management Services Limited
63 Reliance Global Business B.V.
64 Reliance Gas Corporation Limited
65 Reliance Global Energy Services Limited
66 Reliance One Enterprises Limited
67 Reliance Global Energy Services (Singapore) Pte. Ltd.
68 Reliance Personal Electronics Limited
69 Reliance Polymers (India) Limited
70 Reliance Polyolefins Limited
71 Reliance Aromatics and Petrochemicals Private Limited
72 Reliance Energy and Project Development Private Limited
73 Reliance Chemicals Limited
74 Reliance Universal Enterprises Limited
75 International Oil Trading Limited
76 Reliance Review Cinema Limited
77 Reliance Replay Gaming Limited
78 Reliance Nutritional Food Processors Limited
79 RIL USA Inc.
80 Reliance Commercial Land & Infrastructure Limited
81 Reliance Corporate IT Park Limited
82 Reliance Eminent Trading & Commercial Private Limited
83 Reliance Progressive Traders Private Limited
84 Reliance Prolific Traders Private Limited
85 Reliance Universal Traders Private Limited Subsidiary
Companies
86 Reliance Prolific Commercial Private Limited
87 Reliance Comtrade Private Limited
88 Reliance Ambit Trade Private Limited
89 Reliance Petro Marketing Limited
90 LPG Infrastructure (India) Private Limited
91 Reliance Infosolutions Private Limited
92 Reliance Corporate Center Limited
93 Reliance Convention and Exhibition Center Limited
94 Central Park Enterprises DMCC
95 Reliance International B. V.
96 Reliance Corporate Services Private Limited
97 Reliance Industrial Infrastructure Limited
98 Reliance Europe Limited
99 Reliance LNG Limited
100 Indian Vaccines Corporation Limited
101 Gujarat Chemicals Port Terminal Company Limited Associates
102 Reliance Utilities and Power Private Limited
103 Reliance Utilities Private Limited
104 Reliance Ports and Terminals Limited
105 Reliance Gas Transportation Infrastructure Limited
106 Shri Mukesh D. Ambani
107 Shri Nikhil R. Meswani
108 Shri Hital R. Meswani Key Managerial
109 Shri H.S. Kohli Personnel
110 Shri P.M.S. Prasad
111 Shri R. Ravimohan
112 Dhirubhai Ambani Foundation Enterprises over which
113 Jamnaben Hirachand Ambani Foundation Key Managerial Personnel
114 Hirachand Govardhandas Ambani Public
Charitable Trust are able to exercise
115 HNH Trust and HNH Research Society significant influence
Disclosure in Respect of Material Related Party Transactions during the
year :
1. Purchase of Fixed Assets include Reliance Jamnagar Infrastructure
Limited Rs. NIL (Previous Year Rs. 730.64 crore), Reliance Retail
Limited Rs. NIL (Previous Year Rs. 171.34 crore), Reliance Home Store
Limited Rs. 0.05 crore (Previous Year Rs. 5.48 crore), Reliance
Corporate IT Park Limited Rs. 238.38 crore (Previous Year Rs. NIL),
Reliance Europe Limited Rs. NIL (Previous Year Rs. 0.35 crore).
2. Purchase / Subscription of Investments include Reliance Industrial
Investments and Holdings Limited Rs. NIL (Previous Year Rs. 1,750.00
crore), Reliance Strategic Investments Limited Rs. 112.78 crore
(Previous Year Rs. NIL), Reliance Industries (Middle East) DMCC Rs.
99.32 crore (Previous Year Rs. 355.04 crore), Reliance Jamnagar
Infrastructure Limited Rs. NIL (Previous Year Rs. 1,275.00 crore),
Reliance Exploration & Production DMCC Rs. 658.47 crore (Previous Year
Rs. 912.11 crore), Reliance Retail Limited Rs. 1,220.00 crore (Previous
Year Rs. NIL), Reliance Global Business B.V. Rs. 324.40 crore (Previous
Year Rs. NIL) (including conversion of share application money of Rs.
196.86 crore of Previous Year into ÃAÃ Class Preference Shares),
Reliance Gas Transportation Infrastructure Limited Rs. 24.51 crore
(Previous Year Rs. 2,000.00 crore).
3. Sale / redemption of Investments include Reliance Strategic
Investments Limited Rs. 4,216.92 crore (Previous Year Rs. NIL),
Reliance Ventures Limited Rs. 10.00 crore (Previous Year Rs. NIL),
Reliance Industrial Investments and Holdings Limited Rs. 1,750.00 crore
(Previous Year Rs. NIL), Reliance Jamnagar Infrastructure Limited Rs.
350.00 crore (Previous Year Rs. NIL), Reliance Gas Transportation
Infrastructure Limited Rs. 65.68 crore (Previous Year Rs. 102.23
crore), Reliance Ports and Terminals Limited Rs. 89.95 crore (Previous
Year Rs. NIL).
4. Loans given during the year include Reliance Industrial Investments
and Holdings Limited Rs. NIL (Previous Year Rs. 1,211.15 crore),
Reliance Retail Limited Rs. NIL (Previous Year Rs. 1,156.32 crore),
Reliance Exploration & Production DMCC Rs. 22.45 crore (Previous Year
Rs. 19.97 crore), Gapco Kenya Limited Rs. NIL (Previous Year Rs. 22.94
crore), Gapco Tanzania Limited Rs. NIL (Previous Year Rs. 166.06
crore), Gapoil Tanzania Limited Rs. NIL (Previous Year Rs. 179.35
crore), Reliance Global Business B.V. Rs. NIL (Previous Year Rs. 200.57
crore), Reliance Gas Corporation Limited Rs. NIL (Previous Year Rs.
5.96 crore), Reliance Infosolutions Private Limited Rs. 4.70 crore
(Previous Year Rs. 107.59 crore), Reliance Corporate IT Park Limited
Rs. 6.00 crore (Previous Year Rs. NIL), Gujarat Chemicals Port Terminal
Company Limited Rs. 17.00 crore (Previous Year Rs. 0.14 crore). Loans
returned during the year from Reliance Ventures Limited Rs. NIL
(Previous Year Rs. 1,001.49 crore), Reliance Strategic Investments
Limited Rs. NIL (Previous Year Rs. 14.05 crore), Reliance Industries
(Middle East) DMCC Rs. 87.31 crore (Previous Year Rs. 447.63 crore),
Reliance Jamnagar Infrastructure Limited Rs. NIL (Previous Year Rs.
1,619.00 crore), Reliance Netherlands B.V. Rs. NIL (Previous Year Rs.
145.99 crore), Reliance Industrial Investments and Holdings Limited Rs.
1,454.51 crore (Previous Year Rs. NIL), Recron (Malaysia) Sdn Bhd Rs.
NIL (Previous Year Rs. 35.30 crore), Gapco Kenya Limited Rs. 19.78
crore (Previous Year Rs. NIL), Gapco Tanzania Limited Rs. 40.19 crore
(Previous Year Rs. NIL), Gapoil Tanzania Limited Rs. 19.39 crore
(Previous Year Rs. NIL), Reliance Retail Limited Rs. 1,027.61 crore
(Previous Year Rs. NIL), Reliance Global Business B.V. Rs. 196.86 crore
(Previous Year Rs. NIL) (conversion of share application money of
Previous Year into ÃAÃ Class Preference Shares), Reliance Industrial
Infrastructure Limited Rs. 25.00 crore (Previous Year Rs. 10.00 crore).
5. Turnover include to Reliance Industries (Middle East) DMCC Rs. NIL
(Previous Year Rs. 234.07 crore), Reliance Jamnagar Infrastructure
Limited Rs. 0.03 crore (Previous Year Rs. 14.25 crore), Reliance Retail
Limited Rs. 39.46 crore (Previous Year Rs. 1.25 crore), Gapco Kenya
Limited Rs. 2,492.30 crore (Previous Year Rs. 2,341.53 crore), Gapco
Tanzania Limited Rs. 262.92 crore (Previous Year Rs. 139.56 crore),
Gapoil Tanzania Limited Rs. 230.01 crore (Previous Year Rs. 272.07
crore), Recron (Malaysia) Sdn Bhd Rs. 71.87 crore (Previous Year Rs.
143.24 crore), Reliance Supply Chain Solutions Limited Rs. NIL
(Previous Year Rs. 1.29 crore), International Oil Trading Limited Rs.
NIL (Previous Year Rs. 155.11 crore), Reliance Trends Limited Rs. 2.37
crore (Previous Year Rs.0.78 crore), LPG Infrastructure (India) Private
Limited Rs. 191.55 crore (Previous Year Rs. 0.44 crore), Reliance Petro
Marketing Limited Rs. 364.19 crore (Previous Year Rs. 0.10 crore),
Reliance Food Processing Limited Rs. 1.28 crore (Previous Year Rs.
NIL), RIL USA Inc. Rs. 4,875.63 crore (Previous Year Rs. NIL),
Reliance Industrial Investments and Holdings Limited Rs. 592.31 crore
(Previous Year Rs. NIL), Reliance Utilities Private Limited Rs. 0.03
crore (Previous Year Rs. 25.02 crore), Reliance Ports and Terminals
Limited Rs. 3.31 crore (Previous Year Rs. 0.03 crore), Reliance Gas
Transportation Infrastructure Limited Rs. 209.37 crore (Previous Year
Rs. 4.48 crore).
6. Other Income from Reliance Industrial Investments and Holdings
Limited Rs. 373.62 crore (Previous Year Rs. 14.14 crore), Reliance
Ventures Limited Rs. 2.10 crore (Previous Year Rs. 112.91 crore),
Reliance Strategic Investments Limited Rs. 33.07 crore (Previous Year
Rs. 17.96 crore), Reliance Industries (Middle East) DMCC Rs. 0.81 crore
(Previous Year Rs. 5.49 crore), Reliance Jamnagar Infrastructure
Limited Rs. NIL (Previous Year Rs. 1.04 crore), Reliance Exploration &
Production DMCC Rs. 12.25 crore (Previous Year Rs. 19.97crore), Gapco
Kenya Limited Rs. 1.70 crore (Previous Year Rs. 3.16 crore), Gapco
Tanzania Limited Rs. 6.07 crore (Previous Year Rs. 11.45 crore), Gapoil
Tanzania Limited Rs. 6.61 crore (Previous Year Rs. 10.35 crore), Recron
(Malaysia) Sdn Bhd Rs. 4.62 crore (Previous Year Rs. 5.24 crore),
Reliance Global Business B. V. Rs. NIL (Previous Year Rs. 3.71 crore),
Reliance Infosolutions Private Limited Rs. 8.14 crore (Previous Year
Rs. 0.08 crore), Reliance Industrial Infrastructure Limited Rs. 3.88
crore (Previous Year Rs. 2.14 crore), Gujarat Chemicals Port Terminal
Company Limited Rs. 0.83 crore (Previous Year Rs. 1.92 crore),
Reliance Europe Limited Rs. 1.74 crore (Previous Year Rs. 1.29 crore).
7. Purchases from Reliance Industrial Investments and Holdings Limited
Rs. NIL (Previous Year Rs. 32.06 crore), Reliance Industries (Middle
East) DMCC Rs. NIL (Previous Year Rs. 566.87 crore), Recron (Malaysia)
Sdn Bhd Rs. 2.25 crore (Previous Year Rs. NIL), Reliance Petro
Marketing Limited Rs. 54.21 crore (Previous Year Rs. NIL), Reliance Gas
Transportation Infrastructure Limited Rs. 34.43 crore (Previous Year
Rs. NIL), Reliance Ports and Terminals Limited Rs. 10.57 crore
(Previous Year Rs. NIL).
8. Electric Power, Fuel and Water charges paid to Reliance Utilities
and Power Private Limited Rs. 285.83 crore (Previous Year Rs. 289.88
crore), Reliance Utilities Private Limited Rs. 674.47 crore (Previous
Year Rs. 395.86 crore).
9. Hire Charges paid to Reliance Europe Limited Rs. NIL (Previous Year
Rs. 4.63 crore), Reliance Industrial Infrastructure Limited Rs. 32.01
crore (Previous Year Rs. 22.53 crore), Gujarat Chemicals Port Terminal
Company Limited Rs. 48.86 crore (Previous Year Rs. 42.05 crore),
Reliance Gas Transportation Infrastructure Limited Rs. 314.56 crore
(Previous Year Rs. 7.14 crore), Reliance Ports and Terminals Limited
Rs. 163.57 crore (Previous Year Rs. NIL).
10. Manpower Deputation Charges to Reliance Retail Limited Rs. 33.72
crore (Previous Year Rs. 20.81 crore), Reliance Trends Limited Rs. NIL
(Previous Year Rs. 12.00 crore), Reliance Petroinvestments Limited Rs.
NIL (Previous Year Rs. 2.75 crore), Reliance People Serve Limited Rs.
3.00 crore (Previous Year Rs. 4.20 crore), Strategic Manpower Solutions
Limited Rs. 3.97 crore (Previous Year Rs. 0.35 crore), Reliance
Industrial Infrastructure Limited Rs. 11.81 crore (Previous Year Rs.
4.47 crore), Reliance Ports and Terminals Limited Rs. 74.12 crore
(Previous Year Rs. NIL).
11. Payment to Key Management Personnel include to Shri Mukesh D.
Ambani Rs. 15.00 crore (Previous Year Rs. 15.00 crore), Shri Nikhil R.
Meswani Rs. 11.14 crore (Previous Year Rs. 10.93 crore), Shri Hital R.
Meswani Rs. 11.14 crore (Previous Year Rs. 10.93 crore), Shri H. S.
Kohli Rs. 1.32 crore (Previous Year Rs. 1.35 crore), Shri P. M. S.
Prasad Rs. 1.53 crore (Previous Year Rs. NIL), Shri R. Ravimohan Rs.
0.77 crore (Previous Year Rs. NIL).
12. Sales and Distribution Expenses include to Reliance Retail Limited
Rs. 72.13 crore (Previous Year Rs. 72.84 crore), Reliance Ports and
Terminals Limited Rs. 2,524.35 crore (Previous Year Rs. 1,255.26
crore), Gujarat Chemicals Port Terminal Company Limited Rs. 8.49 crore
(Previous Year Rs. 7.97 crore).
13. Rent paid to Reliance Supply Chain Solutions Limited Rs. 0.13
crore (Previous Year Rs. 4.50 crore), Reliance Industrial
Infrastructure Limited Rs. NIL (Previous Year Rs. 2.25 crore).
14. Professional Fees paid to Reliance Financial Distribution and
Advisory Services Limited Rs. 5.00 crore (Previous Year Rs. 14.00
crore), Reliance Universal Ventures Limited Rs. 2.30 crore (Previous
Year Rs. 3.50 crore), Reliance Supply Chain Solutions Limited Rs. 36.00
crore (Previous Year Rs. 21.00 crore), Reliance Infosolutions Private
Limited Rs. 48.00 crore (Previous Year Rs. NIL), Reliance Europe
Limited Rs. 20.20 crore (Previous Year Rs. 16.60 crore), Reliance Ports
and Terminals Limited Rs. 1.12 crore (Previous Year Rs. NIL).
15. General Expenses include to Reliance Jamnagar Infrastructure
Limited Rs. 373.17 crore (Previous Year Rs. 60.01 crore), Reliance
Hypermart Limited Rs. 0.03 crore (Previous Year Rs. 1.95 crore),
Reliance Retail Travel & Forex Services Limited Rs. 0.05 crore
(Previous Year Rs. 1.63 crore), Reliance Retail Limited Rs. 4.60 crore
(Previous Year Rs. NIL), Reliance Footprint Limited Rs. 1.47 crore
(Previous Year Rs. 0.39 crore), Reliance Fresh Limited Rs. 2.51 crore
(Previous Year Rs. 0.13 crore), Reliance Polyolefins Limited Rs. 9.00
crore (Previous Year Rs. NIL), Reliance Industrial Infrastructure
Limited Rs. 9.00 crore (Previous Year Rs. 9.00 crore).
16. Donations to Dhirubhai Ambani Foundation Rs. 16.25 crore (Previous
Year Rs. 35.47 crore), Jamnaben Hirachand Ambani Foundation Rs. 1.30
crore (Previous Year Rs. 0.04 crore).
17. Interest Expenses include to LPG Infrastructure (India) Private
Limited Rs. NIL (Previous Year Rs. 3.64 crore), Reliance Corporate IT
Park Limited Rs. 21.45 crore (Previous Year Rs. NIL).
18. Investment written off (net) includes Gujarat Chemicals Port
Terminal Company Limited Rs. 18.38 crore (Previous Year Rs. NIL).
18. As per Accounting Standard (AS) 17 on ÃSegment ReportingÃ, segment
information has been provided under the Notes to Consolidated Financial
Statements.
21. (a) The Ministry of Corporate Affairs, Government of India vide its
Order No. 46/92/2010-CL-III dated 16-04-2010 issued under Section
211(4) of the Companies Act, 1956 has exempted the Company from
disclosure of quantitative details in the Profit and Loss Account under
paras 3(i)(a), 3(ii)(a) (1) & (2), 3(ii)(b) of Part II, Schedule VI to
the Companies Act,1956.
(b) The Ministry of Corporate Affairs, Government of India vide its
Order No. 47/165/2010-CL-III dated 15-04-2010 has granted approval that
the requirement to attach various documents in respect of subsidiary
companies, as set out in sub-section (1) of section 212 of the
Companies Act, 1956, shall not apply to the Company. As per the Order,
the financial information of each subsidiary is attached.
22. Financial and Derivative Instruments
a) Derivative contracts entered into by the Company and outstanding as
on 31st March, 2010
b) In accordance with principles of prudence and other applicable
guidelines as per Accounting Standards notified by the Companies
(Accounting Standards) Rules 2006, the Company has charged an amount of
Rs. 94.09 crore (Previous Year Rs. 35.32 Crore) to the Profit and Loss
Account in respect of derivative contracts other than those contracts
which are effective hedges.
c) Foreign currency exposures that are not hedged by derivative
instruments as on 31st March, 2010 amount to Rs. 50,442.30 crore.
(Previous Year Rs. 51,432.57 crore).