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Notes to Accounts of Sanghi Industries Ltd.

Mar 31, 2017

1. Rights, preferences and restrictions attached to shares Equity Shares

The Company has one class of equity shares having par value of INR 10 per share. Each member is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount, in proportion to their shareholding.

2. The Company does not have any holding company.

3. The details of Shareholders holding more than 5 % of Shares (including Share Capital Suspense)

4. Financial risk management

The Company has exposure to the following risks arising from financial instruments:

- Credit risk ;

- Liquidity risk ; and

- Market risk

5. Risk management framework

The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The Company manages cash resources, borrowing strategies, and ensures compliance with market risk limits and policies.

Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company’s activities.

The Audit Committee oversees compliance with the company’s risk management policies and reviews the adequacy of the risk management framework in relation to the risks faced by the Company.

6. Credit risk

Credit risk is the risk of financial loss to the Company if a counter party to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and investments in debt securities.

Cash and other bank balances

The company maintains its Cash and cash equivalents and Bank deposits with banks with good past track record and high quality credit rating and also reviews their credit-worthiness on an on-going basis.

Trade receivables

Credit risk is managed through credit approvals, ongoing credit evaluations of its customers’ financial condition and monitoring the creditworthiness of its customers.

7. Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation. The Company maintains sufficient lines of credit to commensurate its business.

Exposure to liquidity risk

The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted, and include estimated interest payments and exclude the impact of netting agreements.

8. Market risk

Market risk is the risk that changes in market prices - such as foreign exchange rates and interest rates - will affect the Company’s income or the value of its holdings of financial instruments. Exposure to market risk is a function of investing and borrowing activities and revenue generating and operating activities in foreign currency.

9. Currency risk

The functional currency of the Company is Indian Rupee. The Company is exposed to currency risk on account of its receivables, borrowings and payables for capital goods in foreign currency. The Company has not used derivative financial instruments either for hedging purpose or for trading or speculative purposes.

Sensitivity analysis

A reasonably possible strengthening (weakening) of the Indian Rupee against US dollars at March 31 would have affected the measurement of financial instruments denominated in US dollars and affected equity by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

10. Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. The Company adopts a policy to ensure that it achieves balance between fixed and floating rate.

11. Exposure to interest rate risk

The Company uses a mix of fixed rates and floating rates of borrowings. The changes in the floating interest rates are monitored closely.

12: Capital Management

The Company’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business.

13:Contingent Liabilities and Commitments

The claims against the company not acknowledged as debt amount to INR 108.75 Cr. (31 March 2016 : INR 130.75 Cr. & 1 July 2015 INR 151.94 Cr.) and interest and penalty thereon as may be decided at the time of disposal of the claim. Against above, the Company has deposited a sum of INR 52.12 Cr. (31 March 2016 : INR 50.64 Cr. & 1 July 2015 : INR 52.95 Cr.) with respective authorities as deposit.

14: Segment reporting

15. Description of segments and principal activities

The Company is in the business of manufacturing and sale of cement and clinker which is considered to constitute one single primary segment.

16. Information about major customers

None of the entity’s external customers account for 10 per cent or more of an entity’s revenue.

17: Related party disclosures

18. Subsidiary, Joint Venture and Associates:

The Company has incorporated subsidiary company in China named, Sange Testing Services (Shanghai) Co., Ltd. on March 20, 2015. However, no investment is made till March 31, 2017.

19. Key Management Personnel:

Shri Ravi Sanghi - Chairman and Managing Director

Shri Aditya Sanghi - Whole Time Director

Shri Alok Sanghi - Whole Time Director

Smt. Bina Engineer - Whole Time Director

Shri N. B. Gohil - Whole Time Director

20. Defined Benefit Plan

The employee’s gratuity fund scheme managed by a Trust is 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 to build up the final obligation. The obligation for leave encashment is recognised in the same manner as for gratuity.

21- Transition to Ind AS:

These financial statements, for the year ended 31 March, 2017, are the first the Company has prepared in accordance with Ind-AS. For periods up to and including the year ended 31 March 2016, the Company prepared its financial statements in accordance with IGAAP including accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended).

The accounting policies set out in Note 1 have been applied in preparing the financial statements for the year ended 31 March, 2017, the comparative information presented in these financial statements for the year ended 31 March 2016 and the opening Ind AS balance sheet at 1 July 2015 (the “transition date”). The comparative period comprises of 9 months since the company had changed its accounting year to end on 31 March each year in compliance with provisions of the Companies Act 2013.

In preparing the opening Ind AS balance sheet, the company has adjusted amounts reported in financial statements prepared in accordance with IGAAP An explanation of how the transition from IGAAP to Ind AS has affected the Company’s financial performance, cash flows and financial position is set out in this note. The optional and mandatory exemptions availed by the Company are enumerated below:

22. Optional exemptions

23. Property Plant and equipments

Ind AS permits a first time adopter to fair value an item of PPE and carry it forward as the deemed cost under Ind AS. Further, Ind AS also permits an entity to restate the values of PPE in compliance with Ind AS 16 principles. Any consequential adjustments are accounted through the retained earnings. Accordingly, the Company has opted to fair value the freehold land and restate the values of other items of PPE based on Ind AS 16 principles. This has resulted in a net increase of INR 143.32 crores on the transition date.

24. Determining whether an arrangement contains a lease

Ind AS 101 includes an optional exemption that permits an entity to apply the relevant requirements in Appendix C of Ind AS 17 for determining whether an arrangement existing at the date of transition contains a lease by considering the facts and circumstances existing at the date of transition (rather than at the inception of the arrangement).

The Company has elected to avail of the above exemption.

25. Mandatory exemptions

26. Estimates

As per Ind AS l0l, an entity’s estimates in accordance with Ind AS at the date of transition to Ind AS at the end of the comparative period presented in the entity’s first Ind AS financial statements, as the case may be, should be consistent with estimates made for the same date in accordance with the previous GAAP unless there is objective evidence that those estimates were in error. However, the estimates should be adjusted to reflect any differences in accounting policies.

As per Ind AS l0l, where application of Ind AS requires an entity to make certain estimates that were not required under previous GAAP, those estimates should be made to reflect conditions that existed at the date of transition (for preparing opening Ind AS balance sheet) or at the end of the comparative period (for presenting comparative information as per Ind AS).

The Company’s estimates under Ind AS are consistent with the above requirement.

27. De recognition of financial assets and liabilities

The Company has elected to apply the de recognition principles of Ind AS 109 prospectively.

28 Revenue recognition:

Excise duty - Under IGAAP sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty. Excise duty on sale of goods is separately presented on the face of statement of profit and loss. Thus sale of goods for the financial year 2015-16 under Ind AS has increased by INR 77.81 cr with a corresponding increase in other expense.

Timing of revenue recognition - Under IGAAP goods sold on FOR terms were recorded at the time of dispatch. However, under Ind AS, revenue is to be recognized based on transfer of risk and reward to customers. This has resulted in increase in inventories and corresponding reduction in sales, cost of goods sold and profit margin.

Cash incentives - Under IGAAP cash incentives provided to customers were recorded under other expenses. Under Ind AS, all such cash incentives given to customers are recorded net off revenue. This has resulted in reduction in sales and other expenses and will have no impact on profit.

Non-cash incentives - Under Ind AS, revenue attributable to open schemes at the reporting date has been deferred along with the corresponding costs.

29 Non convertible preference shares:

The company has issued non-convertible redeemable preference shares. The preference shares does not carry any dividend. Under IGAAP the preference shares were classified as equity at face value of the proceeds. Under Ind AS, these are considered to be liability.

30. Loans and borrowings

Under Indian GAAP transaction costs incurred in connection with interest bearing loans and borrowings are charged to profit or loss for the period. Under Ind AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss using the effective interest method. Further, for the refinancing and modification in terms of the loans, based on quantitative as well as qualitative assessment, the Company has accounted for gain or loss where there has been a substantial change.

31. Employee benefits :

Both under IGAAP and Ind AS, the Company recognized costs related to its post-employment defined benefit plan on an actuarial basis. Under IGAAP the entire cost, including actuarial gains and losses, are charged to profit or loss. Under Ind AS, re measurements gains and losses amounting to INR 0.29 crores (actuarial loss) are recognized immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI. Since this impact does not have an impact on the total comprehensive income, it has not been shown separately in the comprehensive income reconciliation above

32. Stores and spares:

Stores and spares meeting the definition of PPE have been capitalized based on Ind AS 16. Depreciation has been computed on these items from the date of purchase based on the estimated useful life. Resultant adjustment amounting to INR 15.47 crores reduced the retained earnings on the transition date. Further, this resulted in an increase in the comprehensive income by INR 11.84 crores in 2015-16.

33. Embedded lease:

Under Ind AS, an entity is required to assess whether a contract or arrangement contains a lease. The company does not have any lease arrangement

Decommissioning liability:

Under Ind AS, the cost of an item of property, plant and equipment includes the initial estimate of the costs of dismantling and removing the item and restoring the site on which it is located, the obligation for which an entity incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

Such provision is made wherever applicable.

34. The previous year’s figures have been regrouped/reclassified wherever necessary to confirm with current year’s classification.


Mar 31, 2016

Note 1. Contingent Liabilities and Commitments

The claims against the company not acknowledged as debt amount to Rs, 130.75 Cr. (Previous year Rs, 151.94 Cr.) and interest and penalty thereon as may be decided at the time of disposal of the claim. Against above, the Company has deposited a sum of Rs, 50.64 Cr. (Previous Yfear Rs, 52.95 Cr.) with respective authorities as deposit.

Note 2. Deferred Tax (Assets) / Liabilities

For recognition of Deferred Tax Asset (DTA) where the Company has unabsorbed depreciation under Income Tax Act, 1961: the virtual certainty of realization of such assets is prescribed as a criteria in AS 22. For the current year, the Company has not recognized such DTA in the accounts on prudent basis.

The Company is in the business of manufacturing and sale of cement and clinker which is considered to constitute one single primary segment. The secondary segment based on geographical segmentation are considered to be business outside India and within India.

Domestic revenue includes Rs, 0.25 crore self consumption (Previous Year Rs, 0.36 crore)

Note 3. related Party Disclosure as per Accounting Standard 18:

a. Key Management Personnel:

Mr. Ravi Sanghi - Chairman and Managing Director

Mr. Aditya Sanghi - Whole Time Director Mr. Alok Sanghi - Whole Time Director

Mrs. Bina Engineer - Whole Time Director Mr. N. B. Gohil - Whole Time Director

b. Subsidiary, Joint Venture and Associates:

The Company has incorporated subsidiary Company in China named, Sange Testing Services (Shanghai) Co., Ltd. on March 20, 2015. However, no investment is made till March 31, 2016.

c. Enterprises over which persons described in (a) above are able to exercise significant influence

1. Sanghi Infrastructure Ltd.

2. Kachchh Steels Pvt. Ltd.

Note 4. Additional information pursuant to the provisions of Schedule III to the Companies Act, 2013 is as under:

Note 5. In conformity to the Companies Act 2013, the Company has changed its Accounting year to 31st March and hence, the current financial year ended on 31st March 2016 is for the period of 9 months and not comparable with those of the previous year.


Jun 30, 2015

1. ABOUT THE COMPANY

Sanghi Industries Limited was incorporated in 1985 and is engaged in the manufacturing and marketing of cement and cement products in domestic and export market. The Company's manufacturing facilities are at Sanghipuram, Gujarat. Equity shares of the Company are listed on The National Stock Exchange and Bombay Stock Exchange.

2. Terms / Rights attached to equity shares

The Company has only one class of equity shares having a par value of ' 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian Rupees. The Dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuring Annual General Meeting.

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

3. Terms of redemption of Redeemable Preference Shares

Preference Shares are redeemable in stepped up quarterly instalments from June 2011 to June 2018.

4. Details of shares alloted as fully paid up pursuant to contract(s) without payment being received in cash, bonus shares and shares bought back during immediately preceding five years. - NIL

5. Corporate Social Responsibility Expenses

a) Gross amount required to be spent by the Company during the year is Rs.1.13 cr. based on average net profit of last three years as per Section 198 of the Companies Act, 2013.

b) Amount spent during the year in cash on purposes other than construction / acquisition of any asset is Rs. 1.70 cr.

6. Contingent Liabilities and Commitments

The claims against the company not acknowledged as debt amount to Rs.151.94 cr. (Previous year Rs.139.35 cr.) and interest and penalty thereon as may be decided at the time of disposal of the claim. Against above, the Company has deposited a sum of Rs.52.95 cr. (Previous Year Rs.46.26 cr.) with respective authorities as deposit.

Rs. In crore)

As at As at 30.06.2015 30.06.2014

Excise & Service Tax 104.58 80.78

Customs 12.41 12.41

Sales Tax 1.76 1.76

Debt Recovery Tribunal - 11.21

Claims of Gujarat Water Supply and Sewerage Board 26.38 26.38

Land Revenue Tax 1.17 1.17

Electricity Duty 3.30 3.30

Other Claims against the Company 2.34 2.34

Total 151.94 139.35

hEstimated amount of contracts remaining to be executed on capital account and not provided for is '4.46 cr. Net of advances (Previous year '53.77 cr.)

7. Deferred Tax (Assets) / Liabilities

For recognition of Deferred Tax Asset (DTA) where the Company has unabsorbed depreciation under Income Tax Act, 1961, the virtual certainty of realization of such assets is prescribed as a criteria in AS 22. For the current year, the Company has not recognized such DTA in the accounts on prudent basis.

8. Segment Reporting

The Company is in the business of manufacturing and sale of cement and clinker which is considered to constitute one single primary segment. The Secondary segment based on geographical segmentation are considered to be Business Outside India and within India.

9. Related Party Disclosure as per Accounting Standard 18:

a. Key Management Personnel:

Mr. Ravi Sanghi - Chairman and Managing Director

Mr. Aditya Sanghi - Whole Time Director

Mr. Alok Sanghi - Whole Time Director

Mrs. Bina Engineer - Whole Time Director

Mr. N. B. Gohil - Whole Time Director

b. Subsidiary, Joint Venture and Associates:

The Company has incorporated subsidiary Company in China named, Sange Testing Services (Shanghai) Co., Ltd. on March 20, 2015. However, no investment is made till June 30, 2015.

10. Other expenses include NIL pertaining to prior period expenses (Previous year '0.17 crore).

11. Power and Fuel consumption include exchange loss of '0.82 crores. (Previous year Rs.2.96 crore)

12. Additional information pursuant to the provisions of Schedule V to the Companies Act, 2013 is as under:

13. As per the Mines and Minerals (Development and Regulations) Amendment Act, 2015, the Company is required, in addition to royalty, pay to the District Mineral Foundation of the district in which the mining operations are carried out, an amount not exceeding the royalty paid, in such a manner and subject to the categorization of the mining leases and the amounts payable by the various categories of lease holders, as may be prescribed by the Central Government.

The Company is also required to pay a sum equivalent to two percent of the royalty to the National Mineral Exploration Trust as per the requirement of the Mines and Minerals (Development and Regulations) Amendment Act, 2015.

As on the balance sheet date, contribution required to be made to District Mineral Foundation is not determined and rules for National Mineral Exploration trust are yet to be notified, hence no provision is made during the year ended June 30, 2015.

14. The previous year's figures have been regrouped/reclassified wherever necessary to conform with current year's classification.


Jun 30, 2013

Note : 1 (a) : ABOUT THE COMPANY

Sanghi Industries Limited is engaged in the manufacturing and marketing of cement and cement products in domestic and export market. The Company’s manufacturing facilities are at Sanghipuram'' Gujarat. Equity shares of the Company are listed on The National Stock Exchange and Bombay Stock Exchange.

NOTE 2 For recognition of Deferred Tax Asset (DTA) where the Company has unabsorbed depreciation under Income Tax Act'' 1961; the virtual certainty of realisation of such assets is prescribed as a criteria in AS 22. For the current year'' the Company has not recognized such DTA in the accounts on prudent basis.

NOTE 3 RELATED PARTY DISCLOSURE:

a. Key Management Personnel:

i. Mr. Ravi Sanghi – Chairman and Managing Director ii. Mr. Aditya Sanghi – Whole Time Director iii. Mr. Alok Sanghi – Whole Time Director iv. Mrs. Bina Engineer – Whole Time Director v. Mr. N.B. Gohil – Whole Time Director

NOTE 4 Other Expenses include Rs.2.01 Crore pertaining to prior period expenses (Previous year NIL).

NOTE 5 Additional information pursuant to the provisions of paragraph 3'' 4C and 4D of Part (II) of Schedule VI to the Companies Act'' 1956 is as under (Certified by the management):

Note 6 The previous year’s figures have been regrouped/reclassified wherever necessary to conform with current year’s classification.

7. The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although these estimates are based upon management’s best knowledge of current events and actions'' actual results could differ from these estimates. Differences between actual results and estimates are recognized in the period in which the results are known / materialized.

8. The accounts are prepared on historical cost convention and in compliance with the Generally Accepted Accounting Principles in India and in all material respect with the Accounting Standards notified under The Companies Accounting Standards Rule 2006 and the relevant provision of The Companies Act'' 1956.


Jun 30, 2012

A) Disclosure of Sundry Creditors under Current Liabilities is based on the information provided by the supplier regarding their status as defined under the "Micro, Small and Medium Enterprises Development Act, 2006". Amount overdue as on 30th June 20I2 to Micro, Small and Medium Enterprises on account of principal amount together with interest, aggregate to Rs. Nil (previous year Rs. Nil).

b) No provision for Income Tax is made in the current period in view of the computation of income resulting in loss as per the normal computation as per provision of the Income Tax Act for AY 20I2-I3. MAT Credit Entitlement for the current period Rs. Nil (PY. Rs. 3.I0 crores) . The Deferred Tax Liability and Deferred Tax Assets as on 30.06.20I2 computed as per AS 22 is as under:

c) Related Party Disclosure :

a. Key Management Personnel:

i. Mr. Ravi Sanghi - Chairman and Managing Director

ii. Mr. Aditya Sanghi - Whole Time Director

iii. Mr. Alok Sanghi - Whole Time Director

iv. Mrs. Bina Engineer - Whole Time Director

v. Mr. N.B. Gohil - Whole Time Director

b. Particulars of remuneration paid to Chairman and Managing Director and Whole time Directors are given in Para 4 of the Report on Corporate Governance.

c. As informed, there are no subsidiaries or associate companies.

d) The claims against the company not acknowledged as debt amount to Rs. 118.14 crore (Previous year Rs. 126.35 crore) and interest and penalty thereon as may be decided at the time of disposal of the claim. Against above, the Company has deposited a sum of Rs. 49.11 crore (Previous Year- Rs. 54.24 crore) with respective authorities as deposit.

e) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 0.82 crore (net of advances) (Previous year Nil)

f) Foreign currency exposure that are not hedged by derivative instruments or otherwise as on 30th June, 20I2 amount to Rs. 2II.39 crore ( Previous Year Rs. 202.75 crore )

g) The previous year's figures have been regrouped/reclassified wherever necessary to conform to current year's classification. However, previous year's figures are for I5 months and therefore, are not comparable.

h) Additional information pursuant to the provisions of paragraph 3, 4C and 4D of Part (II) of Schedule VI to the Companies Act, I956 is as under (Certified by the management):


Mar 31, 2010

1. Secured Loans

a) The Term Loan from IDBI, Dena Bank, Bank of Rajasthan Ltd., Lakshmi Vilas Bank Limited, India Debt Management Pvt. Ltd., Deutsche Investment India Pvt. Ltd., Goldman Sachs (India) Finance Pvt. Ltd. and Power Finance Corporation Ltd., are secured by a registered mortgage of the present and future fixed assets except Thermal Power Plant of the Company.

b) The Foreign Currency Loan from FMO, Netherlands is secured by the mortgage of thermal power plant.

c) The working capital facility from Bank of India is secured by a charge on the Current Assets.

d) The aforesaid Loans, in addition to the security are guaranteed by the Promoter Directors in their personal capacity.

2. Inventory of Raw Materials, Consumables, Stores, Packing Material and Work-in-Progress, are valued at weighted average cost basis, certified by the management. Finished goods and semi finished goods are valued at lower of cost (inclusive of excise duty, if paid) and net realizable value.

3. Depreciation on Fixed Assets has been provided as per schedule XIV to the Companies Act, 1956. The Company has worked all the three shifts during the Year and it is a continuous process plant and the depreciation has been provided accordingly.

4. The production facilities of Polymers Division have been leased to M/s. Sanghi Polymers Pvt. Ltd. (SPPL) with effect from 1st April, 2003 till the process of hiving off of Polymer division is completed with necessary approvals. The lessee has also taken over the obligation of the servicing of the debt secured by the said assets. The lease rent of Rs.12 lacs p.a. is charged as such the same is not considered as a separate segment. Since the actual transfer of assets are pending, instead of SPPL, ICICI Bank and State Bank of Hyderabad have filed a claim against SIL in Debt Recovery Tribunal at Mumbai and Hyderabad for the recovery of their Principal dues of Rs.2.68 crs. and Rs.11.21 crs. respectively and interest thereon as may be decided. These amounts have been included as Contingent Liabilities in Note No. 12 (d)

5. The debtors, creditors and loans and advances balances are subject to confirmation and adjustments, if any.

6. Disclosure of Sundry Creditors under Current Liabilities is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small, and Medium Enterprises Development Act, 2006". Amount overdue as on 31st March, 2010 to Micro, Small, and Medium Enterprises on account of principal amount together with interest, aggregate to Rs. Nil (previous year Rs. Nil). The auditors have relied on the same.

7. (i) Income Tax : No provision for Income Tax is made in the current year in view of the computation of income resulting in loss as per the provision of the Income Tax Act, however, there is book profit as envisaged in section 115 JB of the Income Tax Act and Tax thereon has been provided.

(ii) MAT credit Entitlement includes Rs.34.02 crores pertaining to earlier years.

(iii) Deferred Tax:

Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date, unlike MAT rate at which it was considered till March 2009.

8. Related Party Disclosure:

a. Key Management Personnel:

Mr. Ravi Sanghi - Managing Director Mr. Aditya Sanghi – Whole Time Director Mr. Alok Sanghi - Whole Time Director Mrs. Bina Engineer – Whole Time Director

b. Particulars of remuneration paid to Managing Director and Whole time Directors are given in note No. 14 of this schedule.

c. As informed, there are no subsidiaries or associate companies.

9. The Company had certain derivative transactions with a Bank in 2008-09. These were terminated by the Bank and a claim of USD 37 million was raised on the Company. The matter was under Arbitration at London Court of International Arbitration. Prior to any decision at LCIA, the bank has paid compensation of Rs.5.8 crore to the Company and withdrawn its claim, which is reflected in Schedule "9".

10. a. Provisions involve substantial degree of estimation in measurement and recognized where there is present obligation as a result of the past events and it is probable that there will be an outflow of resources.

b. Contingent liabilities are not recognized but disclosed in notes.

c. Contingent assets are neither recognized nor disclosed in financial statements

d. The claims against the Company not acknowledged as debt amount to Rs.74.83 crore (Previous year Rs.73.41 crore) and interest and penalty thereon as may be decided at the time of disposal of the claim. Against above, the Company has deposited a sum of Rs.42.41 crore (Previous Year- Rs.40.65 crore) with respective authorities as deposit.

e. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.2.16 crore ( Previous year Rs.6.67 crore)

11. Details of Directors Remuneration

a. The Managing Director has waived his remuneration and commission for the current financial year.

12. Foreign currency exposure that are not hedged by derivative instruments or otherwise as on 31st March 2010 amount to Rs.186.46 crore (Previous Year Rs.217.34 crore)

13. Previous years figures have been regrouped/reclassified wherever necessary.

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