Notes to Accounts of Tamil Nadu Newsprint And Papers Ltd.

Mar 31, 2023

PROVISION AND CONTIGENT LIABILTY

A provision is recognized if, as a result of a past event, the Company has a present legal or constructive
obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be
required to settle the obligation. Provisions are determined by discounting the expected future cash flows
(representing the best estimate of the expenditure required to settle the present obligation at the balance
sheet date) at a pre-tax rate that reflects current market assessments of the time value of money and the
risks specific to the liability. The unwinding of the discount is recognized as finance cost. Expected future
operating losses are not provided for.

Decommissioning costs

Decommissioning costs are measured as the best estimate of the expenditure to settle the obligation or to
transfer the obligation to a third party. Provisions for decommissioning obligations are required to be recognized
at the inception of the arrangement. The estimated costs to be incurred at the end of the arrangement are
discounted to its present value using the market rate of return.

A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by
the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company
or a present obligation that is not recognized because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a
liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize
a contingent liability but discloses its existence in the financial statements.

Contingent Assets

A contingent asset is a possible asset that arises from past events and whose existence will be confirmed only
by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of
the entity. The inflow of economic benefits cannot be measured due to uncertainties that surround the related
events and circumstances.

Contingent assets are not recognized, but they are disclosed when it is more likely than not that an inflow of
benefits will occur.

l. Revenue recognition

Revenue is measured based on the transaction price, which is the fair value of the consideration received or
receivable after netting trade discounts, volume discounts, sales returns and Goods and Services Tax. Revenue
from sale of goods is recognized upon transfer of control of promised goods or services to customers.

Revenue from contract with customers is recognized when the Company satisfies performance obligation by
transferring promised goods and services to the customer. Performance obligations are satisfied at a point of
time. Performance obligations are said to be satisfied at a point of time when the customer obtains controls
of the goods / services rendered i.e, transfer of control happen when the goods are delivered to the carrier.

Rental income from investment property is recognized as part of other income in profit or loss on a straight¬
line basis over the term of the lease except where the rentals are structured to increase in line with expected
general inflation.

Renewable Energy Certificate (REC) / Energy Saving Certificates (ESCerts) issued by Bureau of Energy
Efficiency (BEE) benefits are recognized in the statement of Profit and Loss on sale of REC''s / ESCerts.

Liquidated damages and penalties recovered from suppliers/contractors, in relation to property, plant and
equipment are credited to statement of profit and loss unless the delay has resulted in extra cost of assets,
in which case the same are adjusted towards the carrying cost of the respective asset. In case of Interest
from Customers (Overdue bills), the Interest income is recognized only when the uncertainty of realization
does not exist.

Barter transactions

The Company has engaged into barter transactions comprising of exchanging steam/fuel for bagasse. This
exchange though is of dissimilar goods, would not qualify as sale since it is not a product sold by the Company
and the transaction does not have commercial substance.

Export Benefits

The benefit accrued under Duty Drawback Scheme as per the Export and Import Policy in respect of exports
made is accounted on an accrual basis and is included under the head "Revenue from Operations" as ''Other
Operating Revenue - Export Incentives''.

The benefit accrued under the Merchandise Exports from India Scheme (MEIS)/ Remission of Duties or Taxes
on Export Products Scheme (RoDTEP) in respect of exports on an accrual basis and is included under the head
"revenue from operations" as ''Other Operating Revenue - Export Incentives''.

Export benefits available under eligible schemes are recognized in the year when the right to receive credit as
per the terms of the scheme is established in respect of exports made and are accounted to the extent there
is no significant uncertainty about the measurability and ultimate utilization/ realization of such duty credit.

m. Government grants

Government grants and project incentives are recognized initially as deferred income at fair value when there
is reasonable assurance that they will be received and the Company will comply with the conditions associated
with the grant and the same is recognized in statement of profit and loss as other income on a systematic
basis.

Grants that compensate the Company for expenses incurred are recognized in profit or loss as other income
on a systematic basis in the periods in which such expenses are recognized.

n. Leases

i. The Company as a Lessor:

Leases for which the Company is a lessor is classified as a finance or operating lease. Whenever the terms of
the lease transfer substantially all the risk and rewards of ownership to the lessee, the contract is classified
as finance lease. All other leases are classified as operating lease.

ii. The Company as a Lessee:

The Company''s lease asset consists of lease for buildings and Plant & Machinery. The Company assesses
whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract
conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To
assess whether a contract conveys the right to control the use of an identified asset, the Company assesses
whether: (i) the contract involves the use of an identified asset (ii) the Company has substantially all of the
economic benefits from use of the asset through the period of the lease and (iii) the Company has the right
to direct the use of the asset.

At the date of commencement of the lease, the Company recognizes a right-of-use asset ("ROU") and a
corresponding lease liability for all lease arrangements in which it is a lessee, except for leases with a term of
twelve months or less (short-term leases) and low value leases. For these short-term and low value leases,
the Company recognizes the lease payments as an operating expense on a straight-line basis over the term
of the lease.

Certain lease arrangements includes the options to extend or terminate the lease before the end of the lease
term. ROU assets and lease liabilities includes these options when it is reasonably certain that they will be
exercised.

The right-of-use assets are initially recognized at cost, which comprises the initial amount of the lease liability
adjusted for any lease payments made at or prior to the commencement date of the lease plus any initial
direct costs less any lease incentives. They are subsequently measured at cost less accumulated depreciation
and impairment losses.

Right-of-use assets are depreciated from the commencement date on a straight-line basis over the shorter
of the lease term and useful life of the underlying asset. Right-of-use assets are tested for impairment
whenever there is any indication that their carrying amounts may not be recoverable. Impairment loss, if any,
is recognised in the statement of profit and loss.

The lease liability is initially measured at amortized cost at the present value of the future lease payments.
The lease payments are discounted using the interest rate implicit in the lease or, if not readily determinable,
using the incremental borrowing rates. Lease liabilities are remeasured with a corresponding adjustment to
the related right of use asset if the Company changes its assessment if whether it will exercise an extension
or a termination option.

Lease liability and ROU asset have been separately presented in the Balance Sheet and lease payments have
been classified as financing cash flows.

o. Recognition of dividend income, interest income or expense

Dividend income is recognized in statement of profit and loss on the date on which the company''s right to
receive payment is established. Interest income or expense is recognized using the effective interest method.

The ''effective interest rate'' is the rate that exactly discounts estimated future cash payments or receipts
through the expected life of the financial instrument to:

• the gross carrying amount of the financial asset; or

• the amortized cost of the financial liability.

In calculating interest income and expense, the effective interest rate is applied to the gross carrying amount of
the asset (when the asset is not credit-impaired) or to the amortized cost of the liability. However, for financial
assets that have become credit-impaired subsequent to initial recognition, interest income is calculated by
applying the effective interest rate to the amortized cost of the financial asset. If the asset is no longer credit-
impaired, then the calculation of interest income reverts to the gross basis.

p. Income tax

Income tax comprises current and deferred tax. It is recognized in statement of profit and loss except to the
extent that it relates to an item recognized directly in equity or in other comprehensive income.

i. Current tax

Current tax comprises the expected tax payable or receivable on the taxable income or loss for the year and
any adjustment to the tax payable or receivable in respect of previous years. The amount of current tax
reflects the best estimate of the tax amount expected to be paid or received after considering the uncertainty,
if any, related to income taxes. It is measured using tax rates (and tax laws) enacted or substantively enacted
by the reporting date.

Current tax assets and current tax liabilities are offset only if there is a legally enforceable right to set
off the recognized amounts, and it is intended to realize the asset and settle the liability on a net basis or
simultaneously.

ii. Deferred tax

Deferred tax is recognized in respect of temporary differences between the carrying amounts of assets
and liabilities for financial reporting purposes and the corresponding amounts used for taxation purposes.
Deferred tax is also recognized in respect of carried forward tax losses and tax credits.

Deferred tax assets are recognized to the extent that it is probable that future taxable profits will be available
against which they can be used. The existence of unused tax losses is strong evidence that future taxable
profit may not be available. Therefore, in case of a history of recent losses, the Company recognizes a
deferred tax asset only to the extent that it has sufficient taxable temporary differences or there is convincing
other evidence that sufficient taxable profit will be available against which such deferred tax asset can be
realized. Deferred tax assets - unrecognized or recognized, are reviewed at each reporting date and are
recognized/ reduced to the extent that it is probable/ no longer probable respectively that the related tax
benefit will be realized.

Credit for Minimum Alternative Tax (MAT) if any is recognized as a part of deferred tax assets. Deferred tax is
measured at the tax rates that are expected to apply to the period when the asset is realized or the liability is
settled, based on the laws that have been enacted or substantively enacted by the reporting date.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities
and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or
on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax
assets and liabilities will be realized simultaneously.

q. Borrowing cost

Borrowing costs are interest and other costs (including exchange differences relating to foreign currency
borrowings to the extent that they are regarded as an adjustment to interest costs) incurred in connection

with the borrowings. Borrowing costs directly attributable to acquisition or construction of an asset which
necessarily take a substantial period of time to get ready for their intended use are capitalized as part of
the cost of that asset. Other borrowing costs are recognized as an expense in the period in which they are
incurred.

r. Cash flow statements

Cash flow statements are prepared under Indirect Method whereby profit or loss is adjusted for the effects
of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or
payments, and items of income or expense associated with investing or financing cash flows. Cash and cash
equivalents comprise of cash in hand, current and other accounts (including fixed deposits) held with banks
and bank overdraft (Cash Credit).

s. Events occurring after the balance sheet date

Assets and liabilities are adjusted for events occurring after the reporting period that provides additional
evidence to assist the estimation of amounts relating to conditions existing at the end of the reporting period.

Dividends declared by the Company after the reporting period are not recognized as liability at the end of the
reporting period. Dividends declared after the reporting period but before the issue of financial statements
are not recognized as liability since no obligation exists at that time. Such dividends are disclosed in the notes
to the financial statements.

t. Operating segments

An operating segment is a component of the Company that engages in business activities from which it may
earn revenues and incur expenses, including revenues and expenses that relate to transactions with any
of the Company''s other components, and for which discrete financial information is available. All operating
segments'' operating results are reviewed regularly by the Company''s Board of Directors (BoD) to make
decisions about resources to be allocated to the segments and assess their performance.

A component that is dependent substantially on any other operating component and which does not
trigger threshold for reporting under Ind AS - 108 is aggregated with the main segment.

Revenue and expenses have been identified to respective segments on the basis of operating activities
of the enterprise. Revenue and expenses which relate to the enterprise as a whole are not allocable to
a segment on a reasonable basis have been disclosed as un-allocable assets and liabilities.

Inter segment revenue / expenses are recognized at cost.

Geographical segments considered for reporting are India and Rest of the World.

Information about reportable segments

Performance is measured based on segment profit (before tax), as included in the internal management
reports that are reviewed by the Company''s CEO. Segment profit is used to measure performance as
management believes that such information is the most relevant in evaluating the results of certain
segments relative to other entities that operate within these industries. Inter-segment pricing is
determined on cost basis.

u. Earnings per share (EPS)

Basic earnings per share is computed by dividing profit or loss attributable to equity shareholders of the
Company by the weighted average number of equity shares outstanding during the year. The Company
did not have any potentially dilutive securities in any of the years presented.

v. Dividends

Final dividend on shares is recorded as a liability on the date of approval by the shareholders and interim
dividends are recorded as a liability on the date of declaration by the Company''s Board of Directors.

The Company declares and pays dividends in Indian rupees. The remittance of dividends outside India
is governed by Indian law on foreign exchange and is subject to applicable distribution taxes.

Dividends, if any are to be declared at the Annual General Meeting of Shareholders based on the
recommendation of the Board of Directors. Generally, the factors that may be considered by the Board
of Directors before making any recommendation of dividend include, without limitation, the company''s
future expansion plans and capital requirements, profits earned during the fiscal year, cost of raising
funds from alternative sources, liquidity position, applicable taxes including tax on dividend as well as
exemptions under tax laws available to various categories of investors from time to time and general
market conditions.

w. Amendments to Indian Accounting Standards (Ind AS) issued but not yet effective

Recent accounting pronouncements Ministry of Corporate Affairs ("MCA") notifies new standards or
amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued
from time to time. On March 31, 2023, MCA amended the Companies (Indian Accounting Standards)
Amendment Rules, 2023, and the major amendments are as below:

Ind AS 1 - Presentation of Financial Statements

This amendment requires the entities to disclose their material accounting policies rather than their
significant accounting policies and also identify and eliminate immaterial accounting policies from the
financial statements. The effective date for adoption of this amendment is annual periods beginning on
or after April 1, 2023. The Company has evaluated the amendment and the impact of the amendment
is insignificant in the standalone financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors

This amendment has introduced a definition of ''accounting estimates'' which was absent hitherto, and
included amendments to Ind AS 8 to help entities distinguish changes in accounting policies from
changes in accounting estimates. The effective date for adoption of this amendment is annual periods
beginning on or after April 1, 2023. The Company has evaluated the amendment and there is no impact
on its standalone financial statements.

Ind AS 12 - Income Taxes

This amendment has narrowed the scope of the initial recognition exemption so that it does not apply to
transactions that give rise to equal and offsetting temporary differences. The effective date for adoption
of this amendment is annual periods beginning on or after April 1, 2023. The Company has evaluated
the amendment and there is no impact on its standalone financial statement.

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Mar 31, 2018

Fair value hierarchy

(i) The fair value of investment property (Corporate Office Building) has been determined by external, independent property valuers, having appropriate recognized professional qualifications and recent experience in the location and category of the property being valued. Government guideline value is considered as fair value for Land

(ii) The fair value measurement for land has been categorized as Level 1 fair value and for corporate office building has been categorized as Level 2

Equity shares designated as at fair value through other comprehensive income

At 1 April 2016, the Company designated the investments shown below as equity shares as FVOCI because these equity shares represent investments that the Company intends to hold for long term for strategic purposes.

(ii) Rights, preferences and restrictions attached to equity shares

The company has a single class of equity shares. Each equity shares having a par value of Rs, 10. Accordingly, all equity shares rank equally with regard to dividends and share in the company''s residual assets on winding up. The equity shares are entitled to receive dividend as declared from time to time. The voting rights of an equity shareholder on a poll (not on show of hands) are in proportion to his/its share of the paid-up equity share capital of the company. Voting rights cannot be exercised in respect of shares on which any call or other sums presently payable has not been paid. Failure to pay any amount called up on shares may lead to their forfeiture.

In the event of liquidation of the company, the holders of equity shares will be entitled to receive the residual assets of the company, in proportion to the number of equity shares held,after distribution of all preferential amounts. However, no such preferential amounts exist currently.

Nature of reserves

(a) Securities Premium

Securities premium reserve is used to record the premium on issue of shares. The reserve is utilised in accordance with the provision of the Companies Act, 2013.

(b) General reserve

The General reserve is used from time to time to transfer profits from retained earnings for appropriation purposes. As the General reserve is created by a transfer from one component of equity to another and is not item of other comprehensive income, items included in the General reserve will not be reclassified subsequently to statement of profit and loss.

(c) Equity instruments through other comprehensive income

This reserve represents the cumulative gains and losses arising on the revaluation of equity / debt instruments measured at fair value through other comprehensive income, net of amounts reclassified to retained earnings when those assets have been disposed off.

(d) Effective portion of cash flow hedges

The cash flow hedging reserve represents the cumulative effective portion of gains or losses arising on changes in fair value of designated portion of hedging instruments entered into for cash flow hedges. The cumulative gain or loss arising on changes in fair value of the designated portion of the hedging instruments that are recognised and accumulated under the heading of cash flow hedging reserve. Such gains or losses will be reclassified to statement of profit and loss in the period in which the hedged transaction occurs.

(e) Re-measurement of defined benefit plans

Re-measurements of defined benefit liability comprises actuarial gains and losses.

f) 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. Management monitors the return on capital, as well as the level of dividends to equity shareholders.

The Board of Directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowing and the advantages and security afforded by a sound capital position. The weighted-average interest expense on interest-bearing borrowings was 8.30 percent (2016-17: 8.78 percent)

Notes 19. Borrowings (continued)

ECB - External Commercial Borrowings, OFC - Other Foreign Currency Loan

(i) Secured by a first pari passu charge on fixed assets created out of respective loans.

(ii) Secured by a first pari passu charge on fixed assets to be created at Mondipatti Village, Manappari Taluk, Trichy Dist., TN out of respective term loans and first charge on all the movable fixed assets of the company situated at Kagithapuram, Karur Dist., Tamil Nadu on pari passu basis both present & future except which are under specific charge to the respective term lenders and an equitable mortgage by deposit of title deeds in respect of 566.26 acres of land situated at Kagithapuram, Karur District, TN.

(iii) Secured by a first charge on Wind Mill movable assets and subservient charge on the fixed assets of the Company (excluding the machinery which has been specifically charged to the respective lenders) situated at Kagithapuram, Karur Dist.,TN.

(iv) Secured by a first charge on all the fixed assets of the company situated at Kagithapuram, Karur Dist., (movable & immovable ) on pari passu basis both present and future (except assets under specific charge to other lenders) situated at Kagithapuram, Karur Dist., including an equitable mortgage by deposit of title deeds in respect of 566.26 acres of land situated at Kagithapuram, Karur District, Tamil Nadu and pari passu second charge on the current assets of the company viz., stock of raw materials, finished goods, stores and other movables.

(v) Secured by an exclusive charge on movable & immovable properties of Mayanur Unit-equitable mortgage of 38.40 acres of Land & Buildings and charge on Plant & Machinery and subservient charge on movable plant & machinery at Kagithapuram, Karur Dt., TN

(vi) Secured by a first pari passu charge on movable fixed assets of the company (except assets under specific charge to other lenders) situated at Kagithapuram, Karur Dist.,

(vii) First Pari Passu Charge on moveable Fixed Assets with at least 1x cover.

(viii) Residual charge on moveable fixed assets of the company.

(ix) Exclusive hypothecation charge on revamped power plant & machinery

(x) Secured by residual charge on current assets of the company.

(xi) Second hypothecation charge on fixed assets of the borrower with a minimum asset cover of 2X.

(xii) Secured by a first charge on current asses of the company, namely raw materials, stock-in-process, semi-finished goods, finished goods, consumable stores & spares and receivables and a second charge by way of extension of equitable martgage on immovable properties of the company in Kagithapuram, Karur District, Tamil nadu and second charge on the other fixed assets of the company excluding wind mills, vehicles and Computer Software and assets created/proposed to be created out of the ASRS, LSFM,RSPS and DIP projects.

Note (a) Provision for decommissioning liability

The Company has made a provision of Rs, 75.67 lakh (Previous Year Rs, 69.42 lakh) in respect of obligation on decommissioning of Plant & Machinery erected at various Off-sites (Sugar Mills), The unwinding of discount of Rs, 6.25 lakh (Previous Year Rs, 5.73 lakh) recognized as expenses.

Government grants

The company has recognized in its books Government subsidy of Rs, 30 lakh for creation of environment protection infrastructure facility at Board Plant. As subsidy relates a specific asset, the same was treated as deferral income and amortized over the useful life of the asset.

Deferred Rent Payable

TNPL has taken Government lands for lease (Operating lease) for the purpose of captive plantations. The lease period is for thirty years. Incremental rent on year on year basis is applicable till the end of 4^th year and thereafter it will be flat.

161

(i) The Company is entitled to Net Output VAT and CST refund in terms of GO (Ms) No 212/5.9.2015 for a period of twelve years from the Date of Commercial Production with GST compensation clause in the said G.O. The company has recognized Rs, 205 lakh for the period up to 30^th June, 2017. On implementation of GST with effective from 01.07.2017, in the absence of guidelines on eligibility of IGST/CGST for GST Refund entitlement, the Company has considered only Net output SGST amounting to Rs, 360 lakh totalling to Rs, 565.28 lakh for the financial year 2017-18.Net Output VAT/GST Refund includes VAT paid net off input credit up to 30^th June 2017 and SGST paid net off GST credit w.e.f 1^st July 2017 relating to Unit-2 as per the Incentive scheme sanctioned by Government of Tamil Nadu.

(ii) Government grants includes one-time project general subsidy of Rs, Nil. (Previous Year Rs, 192.50 lakh), which is not related to any specific fixed assets has been recognised as other income and Effluent Treatment Plant (ETP) subsidy of Rs, 1.20 lakh (Previous Year Rs, 1.10 lakh) is being related to specific fixed asset has been recognised as other income over the useful life of the asset.

(iii) Excluding cost of bagasse procured in lieu of steam / fuel supplied to Sugar Mills which is included in the respective natural heads of accounts.

(iv) Includes embedded lease rent of Rs, 48 lakhs to M/s.OMYA towards procurement of Wet Precipitated Calcium Carbonate / Wet Grinded Calcium Carbonate as it is considered as a part of cost of chemicals.

Note 42. Operating segments

A) Basis for segmentation

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company''s other components, and for which discrete financial information is available. All operating segments'' operating results are reviewed regularly by the Company''s Board of Directors (BoD) to make decisions about resources to be allocated to the segments and assess their performance.

The Company has three reportable segments, as described below, which are the Company''s strategic business units. For each of the business units the Company''s Board of Directors reviews internal management reports on at least a quarterly basis.

B) Information about reportable segments and reconciliations

Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit (before tax), as included in the internal management reports that are reviewed by the Company''s Board of Directors. Segment profits is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries.

Note 43. General

a) Figures for the previous year have been regrouped/ restated/reclassified wherever necessary to conform to current year''s classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.

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Mar 31, 2017

1. Reporting entity

Tamil Nadu Newsprint and Papers Limited (the ‘Company’ or ‘TNPL’) is a company domiciled in India, with its registered office situated at No. 67, Mount Road, Guindy, Chennai - 600 032, India. The Company has been incorporated under the provisions of Indian Companies Act and its equity shares are listed on the Bombay Stock Exchange (‘BSE’) and National Stock Exchange (NSE) in India. Paper Machine (Unit I) was commissioned in October 1985 with an installed capacity of 90,000 Tons Per Annum (‘TPA’) of Newsprint and Fine Paper. The Company has added two more paper machines and present installed capacity is at 400,000 TPA. The Company has recently started a new plant in Trichy district (“Unit II”) to produce 200,000 TPA high grade paper board for usage in pharmaceuticals, healthcare, food, cosmetics and consumer products.

As a part of solid waste management, TNPL has setup 900 tons per day cement plant.

TNPL is self-sufficient with regard to Power to manufacture Paper & Paper Board and Cement.

2. Basis of preparation

a. Statement of compliance

These financial statements have been prepared in accordance with Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under Section 133 of the Companies Act, 2013 (the ‘Act’) and the relevant provisions of the Act.

The Company’s financial statements up to and for the year ended 31 March 2016 were prepared in accordance with the Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act.

As these are the Company’s first financial statements prepared in accordance with Indian Accounting Standards (Ind AS), Ind AS 101, First-time Adoption of Indian Accounting Standards has been applied. An explanation of how the transition to Ind AS has affected the previously reported financial position, financial performance and cash flows of the Company is provided in the Notes.

b. Functional and presentation currency

These financial statements are presented in Indian Rupees (‘INR’), which is also the Company’s functional currency. All amounts have been rounded-off to the nearest lakhs, unless otherwise indicated.

c. Basis of measurement

The financial statements have been prepared on the historical cost basis except for the following items:

d. Use of estimates and judgements

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively.

Judgements

Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognized in the financial statements is included in the concerned notes.

Assumptions and estimation uncertainties

Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the year ended 31 March 2017 is included in the concerned notes.

e. Measurement of fair values

A number of the company’s accounting policies and disclosures require measurement of fair values, for both financial and non-financial assets and liabilities.

The Company has an established control framework with respect to the measurement of fair values. The Company regularly reviews significant unobservable inputs and valuation adjustments. If third party information is required, the Company assesses the evidence obtained by the third parties to support the conclusions that these valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which the valuations should be classified.

Fair values are categorized into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

- Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognizes transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Further information about the assumptions made in measuring fair values is included in the following notes:

Notes 6 - Investment Property Notes 8 - Biological Assets Notes 39 - Financial Instruments

Measurement of fair values Fair value hierarchy

The fair value of investment property (Corporate Office Building) has been determined by external, independent property valuers, having appropriate recognized professional qualifications and recent experience in the location and category of the property being valued. Government guideline value is considered as fair value for Land

The fair value measurement for land has been categorized as Level 1 fair value and for corporate office building has been categorized as Level 2

3.Biological Assets Other than bearer plants See Accounting policies in Notes 3 (e )

a) Reconciliation of carrying amount

As at 31^st March 2017, standing crops comprises 7538 acres of plantations (31 March 2016: 7675 acres) . During the year the company harvested 8017 Mts (31 March 2016: 10764 Mts).

b) Measurement of fair values

i. Fair value hierarchy

The fair value measurements for the standing crops have been categorized as Level 3 fair values based on the inputs to the valuation techniques used.

ii. Level 3 fair values

The following table shows a breakdown of the total gains (losses) recognized in respect of level 3 fair values (Standing crops)

iii. Valuation techniques and significant unobservable inputs

The following table shows the valuation techniques used in measuring Level 3 fair values and significant unobservable inputs used in Level 3 fair value measurements.

c) Risk management related to agricultural activities

The Company has identified the risk of fire and allied perils, natural calamities like flood, pests and drying up of plant with regard to Biological Assets. The Company has taken insurance policy covering these risks.

Equity shares designated as at fair value through other comprehensive income

At 1 April 2016, the Company designated the investments shown below as equity shares as FVOCI because these equity shares represent investments that the Company intends to hold for long term for strategic purposes.

Rights, preferences and restrictions attached to equity shares

“The company has a single class of equity shares. Accordingly, all equity shares rank equally with regard to dividends and share in the company’s residual assets on winding up. The equity shares are entitled to receive dividend as declared from time to time. The voting rights of an equity shareholder on a poll (not on show of hands) are in proportion to his/its share of the paid-up equity share capital of the company. Voting rights cannot be exercised in respect of shares on which any call or other sums presently payable has not been paid. Failure to pay any amount called up on shares may lead to their forfeiture.

On winding up of the company, the holders of equity shares will be entitled to receive the residual assets of the company, in proportion to the number of equity shares held.”

After the reporting date, the following dividends (excluding dividend distribution tax) were proposed by the Board of Directors subject to the approval at the annual general meeting. The dividends have not been recognized as liabilities. Dividends would attract dividend distribution tax when declared or paid.

4 Analysis of items of Other Comprehensive Income (OCI), net of tax

a) Items of OCI

i) Hedging reserve

ii) Remeasurements of defined benefit liability

iii) Equity instruments through OCI

Effective portion of cash flow hedges

This comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to hedged transactions that have not yet occurred.

Remeasurements of defined benefit liability

Remeasurements of defined benefit liability comprises actuarial gains and losses.

Equity instruments through OCI

The Company has elected to recognize changes in the fair value of investment in equity securities in other comprehensive income. These changes are accumulated within the FVOCI equity investments within equity. The Company transfers amounts there from to retained earnings when the relevant equity securities are derecognized.

b) 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. Management monitors the return on capital, as well as the level of dividends to equity shareholders.

The Board of Directors seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowing and the advantages and security afforded by a sound capital position. The weighted-average interest expense on interest-bearing borrowings was 8.78 percent (2015-16: 9.56 percent).

5 Earnings per share

Basic and diluted earnings per share

The calculations of profit attributable to equity shareholders and weighted average number of equity shares outstanding for purposes of basic earnings per share calculation are as follows:

i. Profit (loss) attributable to equity shareholders (basic and diluted)

ii. Weighted average number of equity shares (basic and diluted)

6 Borrowings ( continued)

See accounting policies in Notes 3 (b)

A. Terms and repayment schedule

B. Secured Bank Loan

# Secured by a first pari passu charge on fixed assets created out of respective loans.

$ Secured by a first pari passu charge on fixed assets to be created at Mondipatti out of respective term loans and first charge on all the movable fixed assets of the company situated at Kagithapuram, Karur Dist., Tamil Nadu on pari passu basis both present & future except which are under specific charge to the respective term lenders and an equitable mortgage by deposit of title deeds in respect of 566.26 acres of land situated at Kagithapuram, Karur District, Tamilnadu.

@ Secured by a first charge on Wind Mill movable assets and subservient charge on the fixed assets of the Company (excluding the machinery which has been specifically charged to the respective lenders) situated at Kagithapuram, Karur Dist.,.

^A Secured by a first charge on all the fixed assets of the company situated at Kagithapuram, Karur Dist., (movable & immovable ) on pari passu basis both present and future (except assets under specific charge to other lenders) situated at Kagithapuram, Karur Dist., including an equitable mortgage by deposit of title deeds in respect of 566.26 acres of land situated at Kagithapuram, Karur District, Tamilnadu and pari passu second charge on the current assets of the company viz., stock of raw materials, finished goods, stores and other movables.

* Secured by an exclusive charge on movable & immovable properties of Mayanur Unit-equitable mortgage of 38.40 acres of Land & Buildings and charge on Plant & Machinery and subservient charge on movable plant & machinery at Kagithapuram, Karur Dt.,

& Secured by a first pari passu charge on movable fixed assets of the company (except assets under specific charge to other lenders) situated at Kagithapuram, Karur Dist.,

&& Secured by residual charge on current assets of the company.

aa Exclusive hypothecation charge on revamped power plant & machinery

$$ Residual charge on moveable fixed assets of the company.

## First Pari Passu Charge on moveable Fixed Assets with at least 1x cover.

** Secured by a first charge on current asses of the company, namely raw materials, stock-in-process, semi-finished goods, finished goods, consumable stores & spares and receivables and a second charge by way of extension of equitable mortgage on immovable properties of the company in Kagithapuram, Karur District, Tamil nadu and second charge on the other fixed assets of the company excluding wind mills, vehicles and Computer Software and assets created/proposed to be created out of the ASRS, LSFM,RSPS and DIP projects.

The Company has made a provision of Rs.69.42 lakh (Previous Year Rs.63.69 lakh) in respect of obligation on decommissioning of Plant & Machinery erected at various Off-sites (Sugar Mills), The unwinding of discount of RS.5.73 lakh (Previous Year Rs.5.26 lakh) recognized as expenses.

(i) Government grants

The company has recognized in its books Government subsidy of Rs.30 lakh for creation of environment protection infrastructure facility at Board Plant. As subsidy relates a specific asset, the same was treated as deferral income and amortized over the useful life of the asset.

(ii) Deferred Rent Payable

TNPL has taken Government lands for lease (Operating lease) for the purpose of captive plantations. The lease period is for thirty years. Incremental rent on year on year basis is applicable till the end of 4^th year and thereafter it will be flat.

The Company’s exposure to currency and liquidity risks related to above financial liabilities is disclosed in Notes 39

# Other payables includes:

a) Rs.2410.35 lakh being the guarantee commission in respect of IBRD Loan guaranteed by Govt. of India lying since 2002

b) Rs. 2579.05 lakh being Electricity Generation Tax for the generation of energy from captive generation plant for own use.

c) Revenue received in advance Rs. Nil (Previous Year Rs.6439.31 lakh)

d) Amount payable for fixed assets Rs.2711.38 lakh (Previous Year Rs.2913.78 lakh)

e) Confirmation of balances from Creditors have been received and the same is being reconciled

* Excluding cost of bagasse procured in lieu of steam / fuel supplied to Sugar Mills which is included in the respective natural heads of accounts

# Includes embedded lease rent of Rs.48 lakhs to M/s.OMYA towards procurement of Wet Precipitated Calcium Carbonate / Wet Grinded Calcium Carbonate as it is considered as a part of cost of chemicals

7 Operating leases

See accounting policies in Notes 3 (n)

A) Leases as lessor

The Company leases out its investment property on operating lease basis (Notes 6).

i) Future minimum lease receivable

At 31 March, the future minimum lease payments under non-cancellable leases are receivable as follows

ii) Amounts recognized in profit and loss - Grouped under other income Notes 27

During the year ended 31 March 2017, property rentals of Rs.113.01 lakhs (31 March 2016: Rs.99.54 lakhs) have been included in other income (Notes 27) in profit or loss, is as follows:

B) Leases as lessee

TNPL has taken Government lands for lease (Operating lease) for the purpose of captive plantations. The lease period is for thirty years. Incremental rent on year on year basis is applicable till the end of 4^th year and thereafter it will be flat.

i) Future minimum lease payments

At 31 March, the future minimum lease payments to be made under non-cancellable operating leases are as follows

ii) Amounts recognized in profit and loss - Grouped under other expenses- Notes 34

C. Financial risk management

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

- Credit Risk (see (C)(ii));

- Liquidity Risk (see (C)(iii)); and

- Market Risk (see (C)(iv)).

i. 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’s risk management policies are established to identify and analyze the risks faced by the company, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the company’s activities.

The Company’s audit committee oversees how management monitors compliance with the company’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.

ii. Credit Risk

Credit risk is the risk of financial loss to the company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the company’s receivables from customers and loans. The carrying amounts of financial assets represent the maximum credit risk exposure.

Trade receivables and loans

The company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base.

The company has established a credit policy under which each new customer is analyzed individually for creditworthiness before the company’s standard payment and delivery terms and conditions are offered. Sale limits are established for each customer and reviewed quarterly. Any sales exceeding those limits require approval from the management of the company.

The company limits its exposure to credit risk from trade receivables by establishing a maximum payment period of 90 days for customers. More than 85% of the company’s customers have been transacting with the company for over four years, and none of these customers’ balances are credit-impaired at the reporting date.

Confirmation of balances from Debtors & Loans and Advances have been received and the same is being reconciled Cash and cash equivalents

The company holds cash and cash equivalents of Rs.2144.62 lakhs at 31 March 2017 (31 March 2016: Rs.1621.28 lakhs). The cash and cash equivalents are held with bank and cash on hand.

Derivatives

The derivatives are entered into with bank as counterparties.

iii. 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 to managing liquidity 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 uses process costing to cost its products, which assists it in monitoring cash flow requirements and optimizing its cash return on investments.

iv. 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. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.

Currency Risk

The company is exposed to transactional foreign currency risk to the extent that there is a mismatch between the currencies in which sales, purchases, receivables and borrowings are denominated and functional currency. The functional currency of the Company is INR. The currencies in which these transactions are primarily denominated are US dollars.

The Company Forex risk management policy is to hedge currency exchange fluctuation and mitigate currency volatility and risks and to avoid uncertainties in cash flows. All foreign currency exposures - financial assets and liabilities and firm commitments (imports) & probable forecast transactions (exports) which are off-balance sheet exposures are covered under FRMP policy. Hedging of trade exposures viz., imports and exports are hedged separately and not on net exposures basis. The company mostly uses forward exchange contracts to hedge its currency risks mostly with the maturity of less than one year from the reporting date. Forward contracts booked to hedge currency risk relating to foreign currency transactions of firm commitments and probable forecast transactions are generally designated as cash flow hedge. All other forward contracts are designated as fair value hedge for the purpose of accounting.

Cash Flow Hedges

The Company holds the following instruments to hedge exposures to changes in foreign currency 40 Operating segments

A) Basis for segmentation

An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components, and for which discrete financial information is available. All operating segments’ operating results are reviewed regularly by the Company’s Board of Directors (BoD) to make decisions about resources to be allocated to the segments and assess their performance.

The Company has three reportable segments, as described below, which are the Company’s strategic business units. For each of the business units the Company’s Board of Directors reviews internal management reports on at least a quarterly basis.

B) Information about reportable segments and reconciliations

Information regarding the results of each reportable segment is included below. Performance is measured based on segment profit (before tax), as included in the internal management reports that are reviewed by the Company’s Board of Directors. Segment profit is used to measure performance as management believes that such information is the most relevant in evaluating the results of certain segments relative to other entities that operate within these industries. Inter-segment pricing is determined on an arm’s length basis.

8. Explanation of transition to Ind AS

As stated in Note 2 (a), these are the Company’s first financial statements prepared in accordance with Ind AS. For the year ended 31 March 2016, the Company had prepared its financial statements in accordance with Companies (Accounting Standards) Rules, 2006, notified under Section 133 of the Act and other relevant provisions of the Act (‘previous GAAP’).

The accounting policies set out in Note 3 have been applied in preparing these financial statements for the year ended 31 March 2017 including the comparative information for the year ended 31 March 2016 and the opening Ind AS balance sheet on the date of transition i.e. 1 April 2015.

In preparing its Ind AS balance sheet as at 1 April 2015 and in presenting the comparative information for the year ended 31 March 2016, the Company has adjusted amounts reported previously in financial statements prepared in accordance with previous GAAP. This note explains the principal adjustments made by the Company in restating its financial statements prepared in accordance with previous GAAP, and how the transition from previous GAAP to Ind AS has affected the Company’s financial position, financial performance and cash flows.

Optional exemptions availed and mandatory exceptions

In preparing these financial statements, the Company has applied the below mentioned optional exemptions and mandatory exceptions.

A. Optional exemptions availed

1. Property plant and equipment, intangible assets and investment properties

As per Ind AS 101 an entity may elect to:

i. measure an item of property, plant and equipment at the date of transition at its fair value and use that fair value as its deemed cost at that date

ii. use a previous GAAP revaluation of an item of property, plant and equipment at or before the date of transition as deemed cost at the date of the revaluation, provided the revaluation was, at the date of the revaluation, broadly comparable to:

a. fair value;

b. or cost or depreciated cost under Ind AS adjusted to reflect, for example, changes in a general or specific price index.

The elections under (i) and (ii) above are also available for intangible assets that meets the recognition criteria in Ind AS 38, Intangible Assets, (including reliable measurement of original cost); and criteria in Ind AS 38 for revaluation (including the existence of an active market).

iii. use carrying values of property, plant and equipment, intangible assets and investment properties as on the date of transition to Ind AS (which are measured in accordance with previous GAAP and after making adjustments relating to decommissioning liabilities prescribed under Ind AS 101).

As permitted by Ind AS 101, the Company has elected to continue with the carrying values under previous GAAP for all the items of property, plant and equipment. The same election has been made in respect of intangible assets and investment property also. The carrying values of property, plant and equipment as aforesaid are after making adjustments relating to decommissioning liabilities.

2. 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.

3. Designation of previously recognized financial instruments

Ind AS 101 permits an entity to designate particular equity investments (other than equity investments in subsidiaries, associates and joint arrangements) as at fair value through other comprehensive income (FVOCI) based on facts and circumstances at the date of transition to Ind AS (rather than at initial recognition). Other equity investments are classified at fair value through profit or loss (FVTPL). The Company has opted to avail this exemption to designate investments in quoted equity shares as FVOCI on the date of transition.

4. Decommissioning liabilities included in the cost of property, plant and equipment

Ind AS 101 permits an entity not to comply with the requirements for changes in decommissioning liabilities that occurred before the date of transition to Ind ASs. The entity shall:

i. measure the liability as at the date of transition to Ind ASs in accordance with Ind AS 37;

ii. to the extent that the liability is within the scope of Appendix A of Ind AS 16, estimate the amount that would have been included in the cost of the related asset when the liability first arose, by discounting the liability to that date using its best estimate of the historical risk-adjusted discount rate(s) that would have applied for that liability over the intervening period; and

iii. calculate the accumulated depreciation on that amount, as at the date of transition to Ind ASs, on the basis of the current estimate of the useful life of the asset, using the depreciation policy adopted by the entity in accordance with Ind ASs. The Company has elected to avail the above exemption.

5. Long Term Foreign Currency Monetary Items

A first-time adopter may continue the policy adopted for accounting for exchange differences arising from translation of longterm foreign currency monetary items recognized in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period as per the previous GAAP.

B. Mandatory exceptions

1. Estimates

As per Ind AS 101, 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 101, 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. Key estimates considered in preparation of the financial statements that were not required under the previous GAAP are listed below:

- Fair valuation of financial instruments carried at FVTPL and/ or FVOCI.

- Fair valuation of biological assets measured at fair value less cost to sell.

- Impairment of financial assets based on the expected credit loss model.

- Determination of the discounted value for financial instruments carried at amortized cost.

- Discounted value of liability for decommissioning costs.

2. Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification of financial assets on the basis of facts and circumstances existing as on the date of transition. Further, the standard permits measurement of financial assets accounted at amortized cost based on facts and circumstances existing at the date of transition if retrospective application is impracticable.

Accordingly, the Company has determined the classification of financial assets based on facts and circumstances that exist on the date of transition. Measurement of the financial assets accounted at amortized cost has been done retrospectively except where the same is impracticable.

a) Lease arrangement

Under previous GAAP, arrangements that did not take the legal form of lease were accounted for based on the legal form of such arrangements e.g. purchase of Wet Precipitated Calcium Carbonate (PCC)/ Wet Grinded Calcium Carbonate (GCC) chemicals from Omya India Private Limited. Under Ind AS, any arrangement (even if not legally structured as lease) which conveys a right to use an asset in return for a payment or series of payments are identified as leases provided certain conditions are met. In case such arrangements are determined to be in the nature of leases, such arrangements are required to be classified into finance or operating leases as per the requirements of Ind AS 17, Leases.

The Company has entered into agreement with Omya India Private Limited for purchase of PCC / GCC chemicals which have been identified to be in the nature of lease and have been classified as operating lease arrangements.

Chemicals consumed includes embedded lease rent of Rs.48 lakh to M/s.OMYA towards procurement of Wet Precipitated Calcium Carbonate / Wet Grinded Calcium Carbonate as it is considered as a part of cost of chemicals. Hence, this has no impact on the profit or loss of the company

b) Re-measurement of defined benefit liability

Under Ind AS, re-measurement of defined benefit liability are recognized under other comprehensive income. Under previous GAAP the Company recognized actuarial gains and losses in profit or loss. However, this has no impact on the total comprehensive income and total equity as on 1 April 2015 or as on 31 March 2016.

c) Investment property

Based on Ind AS 40, the company has reclassified land with undetermined future use and let out portion of Corporate Office building to investment property. Under the previous GAAP, this was disclosed as a part of property, plant and equipment.

As this is only re-classification from Plant, Property & equipment to investment property, there is no impact on statement of profit or loss.

Reclassification from PPE to Investment Property

d) Proposed dividend

Under previous GAAP, dividends proposed by the Board of Directors after the reporting date but before the approval of financial statements were considered to be adjusting event and accordingly recognized (along with related dividend distribution tax) as liabilities at the reporting date. Under Ind AS, dividends so proposed by the Board of Directors are considered to be nonadjusting event. Accordingly, provision for proposed dividend and dividend distribution tax recognized under previous GAAP has been reversed.

e) Excise duty

Under previous GAAP, revenue from sale of goods was presented net of the excise duty on sales. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. Excise duty is presented in the Statement of Profit and Loss as an expense. This has resulted in an increase in the revenue from operations and expenses for the year ended 31 March 2016. The total comprehensive income for the year ended and equity as at 31 March 2016 has remained unchanged.

f) Loss allowance

On transition to Ind AS, the Company has recognized impairment loss on trade receivable based on the expected credit loss model as required by Ind AS 109.

g) Fair valuation of investments

In accordance with Ind AS, financial assets representing investment in equity shares have been fair valued. The Company has designated these investments at fair value through other comprehensive income as permitted by Ind AS 109. Under the previous GAAP, the application of the relevant accounting standard resulted in all these investments being carried at cost.

h) Biological assets other than bearer plants

Under Ind AS 41, Agriculture, biological assets are measured at fair value less costs to sell. Under previous GAAP biological assets were measured at cost.

i) Other Comprehensive Income

Under Ind AS, All items of income and expense recognized in a period should be included in profit and loss account, unless a standard requires or permits otherwise. Items of income and expenses that are not recognized in profit or loss but are shown in the profit or loss as “other comprehensive income” includes re-measurements of define benefit plan, fair value of equity investments and Gain/Loss on Hedging instruments in a Cash Flow hedge. This concept of other comprehensive did not exist under previous GAAP.

j) Deffered Tax

Deffered Tax has been considered on Ind AS transition adjustments.

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Mar 31, 2016

b) ACCOUNTING STANDARD DISCLOSURES:

i) Employee Benefits (AS-15)

a) The fair value of the asset of the provident fund trust including the return on the assets thereof, as on the balance sheet date is greater than the obligations under the defined contribution plan, as determined by the actuary and requires no further charge to Statement profit and loss.

b) Other Defined Benefits

iii) RELATED PARTY DISCLOSURES (AS 18):

The Company has paid the following remuneration during the year to its Chairman & Managing Director (CMD)/Managing Director(MD), Deputy Managing Director(DMD) and Director (OPERATIONS) / Whole Time Director (WTD) and is included in Employee Benefit Expenses (Note No.24):

iv) IMPAIRMENT OF ASSETS (AS 28):

The "recoverable amount" is higher than the "carrying amount" of the cash generating units and hence there is no impairment of losses under AS - 28.

III) GENERAL

a) Figures for the previous year have been regrouped/restated/reclassified wherever necessary to conform to current year''s classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.

¹remitted to Govt. of Tamil Nadu

² remitted to LIC of India Ltd.

Independent Directors were paid sitting fees of Rs.25000/- per meeting.

The company has also taken Director''s and Officer''s (D&O) liability insurance to protect its directors'' personal liability for financial losses that may arise out of any unintentional wrongful acts.

Shareholding of Directors

No Director is holding any shares in the company.

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Mar 31, 2015

Note 1

CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

Particulars As at As at 31/3/2015 31/3/2014

A) CONTINGENT LIABILITIES

a) Claims against the company not acknowledged as debts - Statutory Dues

i) Income-tax 9825.28 6885.27

ii) Wealth Tax 19.46 19.46

iii) Custom Duty 355.32 271.21

iv) Excise Duty 35067.36 32769.15

v) CST/VAT 690.97 0

b) Claims against the company not acknowledged as debts - Others

i) Corporate Office - Land 22.80 22.80

ii) Land Acquisition Claims 137.65 136.12

iii) Cess on Land Lease at Perungudi - Wind farm 92.74 92.74

iv) Interest on Water Royalty paid belatedly 82.48 82.48

v) Lease - Wind Mill 8.12 8.12

vi) Interest - ABFSL 138.24 138.24

vii) Interest on Generation Tax 1429.63 1429.63

viii) Others 660.73 257.26

c) Concession in customs duty availed for imports cleared under EPCG Scheme 13286.10 1550.16

d) Revenue sharing agreement under captive plantation Non-Quantifiable

e) Guarantees issued by the banks on behalf of the Company 3463.51 2633.06

f) Letter of Credit issued by banks on behalf of the Company

Unit - 1 - Paper 7772.40 10142.26

Unit - 2 - Multilayer Coated Board Plant 28081.95 35012.04

Sub-Total (A) 101134.74 91450.00

B) COMMITMENTS

a) Estimated amount of contracts remaining to be executed on capital account and not provided for

Regular Capital Project 862.13 1060.12

Unit - 2 - Multilayer Coated Board Plant 56674.86 71253.43

Sub-Total (B) 57536.99 72313.55

Total (A) (B) 158671.73 163763.55

Note 2

OTHER CURRENT LIABILITIES:

Other payables includes:

a) Rs.2410.35 lakh being the guarantee commission in respect of IBRD Loan guaranteed by Govt. of India lying since 2002

b) Rs.3124.24 lakh being Electricity Generation Tax for the generation of energy from captive generation plant for own use.

h) Confirmation of balances from Debtors, Creditors and for Loans and Advances have been received and the same is being reconciled

i) Farm Forestry Expenditure is charged-off to the Statement of Profit and Loss, in the year in which it is incurred, since it could not be matched with wood procured from farmers.

j) Non Moving Stores & Spares

Stores and spares not drawn for use for more than three years as at the end of the year are charged to revenue. Such stores and spares are carried at nil value in the books and in the year of issue, charged to revenue at nil value.

Note 3

Accounting Standard Disclosures: i) Employee Benefit (AS-15)

a) The fair value of the asset of the provident fund trust including the return on the assets thereof, as on the balance sheet date is greater than the obligations under the defined contribution plan, as determined by the actuary and requires no further charge to Statement profit and loss.

b) Other Defined Benefits

Note 4

IMPAIRMENT OF ASSETS (AS 28):

The "recoverable amount" is higher than the "carrying amount" of the cash generating units and hence there is no impairment of losses under AS - 28.

Note 5

GENERAL

a) Figures for the previous year have been regrouped/restated/reclassified wherever necessary to conform to current year's classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.

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Mar 31, 2014

COMMENTS OF THE COMPTROLLER AND AUDITOR GENERAL OF INDIA UNDER SECTION 619(4) OF THE COMPANIES ACT, 1956 ON THE ACCOUNTS OF TAMIL NADU NEWSPRINT AND PAPERS LIMITED FOR THE PERIOD ENDED 31st MARCH 2014.

The preparation of financial statements of Tamil Nadu Newsprint and Papers Limited for the year ended 31 March 2014 in accordance with the financial reporting framework prescribed under the Companies Act, 1956 is the responsibility of the management of the Company. The Statutory Auditors appointed by the Comptroller and Auditor General of India under Section 619(2) of the Companies Act, 1956 are responsible for expressing opinion on these financial statements under section 227 of the Companies Act, 1956 based on Independent audit in accordance with the auditing and assurance standards prescribed by their professional body, the Institute of Chartered Accountants of India. This is stated to have been done by them vide their Audit Report dated 29-05-2014.

I, on the behalf of the Comptroller and Auditor General of India have conducted a supplementary audit under section 619(3)(b) of the Companies Act, 1956 of the financial statements of Tamil Nadu Newsprint and Papers Limited for the year ended 31 March 2014. This supplementary audit has been carried out independently without access to the working papers of the statutory auditors and is limited primarily to inquires of the statutory auditors and company personnel and a selective examination of some of the accounting records. On the basis of my audit nothing significant has come to my knowledge which would give rise to any comment upon or supplement to Statutory Auditors'' Report under section 619(4) of the Companies Act, 1956.

(Rs.in Lakh)

Note As at As at No. Particulars 31/03/2014 31/03/2013

1) CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

A) CONTINGENT LIABILITIES

a) Claims against the company not acknowledged as debts - Statutory Dues

i) Income-tax 6885.27 4865.88

ii) Wealth Tax 19.46 19.46

iii) Custom Duty 271.21 271.21

iv) Excise Duty 32769.15 29716.39

b) Claims against the company not acknowledged as debts - Others

i) Corporate Office - Land 22.80 22.80

ii) Land Acquisition Claims 136.12 134.60

iii) Cess on Land Lease at Perungudi - Wind farm 92.74 92.74

iv) Interest on Water Royalty paid belatedly 82.48 82.48

v) Lease - Wind Mill 8.12 8.12

vi) Interest - ABFSL 138.24 138.24

vii) Property Tax 0.00 288.39

viii) Generation tax & interest on Generation Tax 1429.63 2373.14

ix) Others 257.26 96.37

c) Concession in custom duty availed for imports cleared under EPCG Scheme 1550.16 2816.79

d) Solar Purchase Obligation 0.00 990.00

e) Revenue sharing agreement under captive plantation Non-Quantifiable

f) Guarantees issued by the banks on behalf of the Company 2633.06 4263.69

g) Letter of Credit issued by banks on behalf of the Company Unit - 1 - Paper 10142.26 6984.87

Unit - 2 - Multilayer Coated Board Plant 35012.04 0.00

Sub-Total (A) 91450.00 53165.17

B) COMMITMENTS

a) Estimated amount of contracts remaining to be executed on capital account and not provided for

Regular Capital Project 1060.12 3551.36

Unit - 2 - Multilayer Coated Board Plant 71253.43 0.00

Sub-Total (B) 72313.55 3551.36

Total (A) (B) 163763.55 56716.53

g) OTHER CURRENT LIABILITIES: Other payables includes:

a) Rs.2410.35 lakh being the guarantee commission in respect of IBRD Loan guaranteed by Govt. of India lying since 2002

b) Rs.2590.46 lakh being Electricity Generation Tax for the generation of energy from captive generation plant for own use.

h) Confirmation of balances from Debtors, Creditors and for Loans and Advances have been received and the same is being reconciled

i) Farm Forestry Expenditure is charged-off to the Statement of Profit and Loss, in the year in which it is incurred, since it could not be matched with wood procured from farmers.

j) Non Moving Stores & Spares

Stores and spares not drawn for use for more than three years as at the end of the year are charged to revenue. Such stores and spares are carried at nil value in the books and in the year of issue, charged to revenue at nil value.

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Mar 31, 2013

AS -1 Related Party Transactions

Remuneration to Key Managerial Personnel, other than Independent Non-executive Directors, is disclosed as ''Related Party Transactions'' in the Notes to Accounts.

AS-2 Leases

Rentals are expensed with reference to lease terms and other considerations. AS - 20 Earnings per Share

a) Basic Earnings per share is computed with reference to the Weighted Average number of Shares, based on monthly rests.

b) Diluted Earnings per share is computed based on fully paid-up value of the Shares issued, as if Calls-in-Arrears has been received.

AS - 3 Accounting for Taxes on Income

Income-tax expense is accounted in accordance with AS 22 - "Accounting for taxes on Income" which includes current taxes and deferred taxes. Deferred taxes reflect the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available.

AS - 4 Intangible Assets

General:

a) Intangible assets are stated at cost less accumulated amortisation.

b) Computer software being intangible asset is amortised over a period of four years. Research and Development:

a) Expenditure relating to capital items are treated as fixed assets and depreciated at applicable rates.

b) Expenditure on Research is recognised as an expense under respective natural heads, as and when incurred.

AS - 5 Impairment of Assets

The Company determines the Impairment of Assets based on Cash Generating Units. For this purpose, the Cash Generating Units have been based on segments of operations, viz., ''Paper & Pulp'' and ''Energy''. The impairment loss will be provided if the carrying amount exceeds recoverable amount.

AS - 6 Provisions, Contingent Liabilities and Contingent Assets

a) A present obligation, which could be reliably estimated, is provided for in the accounts, if it is probable that an outflow of resources embodying economic benefits will be required for its settlement.

b) Contingent Liabilities are disclosed by way of notes in the Balance Sheet.

c) Contingent Assets are neither recognised nor disclosed.

AS -7 Accounting of Derivative Financial Instruments

The Company uses foreign currency forward contracts to hedge its risks associated with foreign currency fluctuations relating to certain firm commitments and forecast transactions. The Company designates these hedging instruments as cash flow hedges applying the recognition and measurement principles set out in the Accounting Standard 30 "Financial Instruments : Recognition and measurement" (AS - 30).

Hedging instruments are initially measured at fair value, and are remeasured at subsequent reporting dates. Changes in the fair value of these derivatives that are designated and effective as hedges of future cash flows are recognized directly in hedge reserve account and the ineffective portion is recognized immediately in Statement of profit and loss.

Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognized in Statement of profit and loss as they arise.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, or exercised, or no longer qualifies for hedge accounting. If a hedged transaction is no longer expected to occur, the net cumulative gain or loss recognized in hedge reserve account is transferred to Statement of profit and loss.

The gain / loss on the hedging instrument in respect of a forecasted transaction / firm commitment in respect of a non financial asset / liability is recognized in the hedge reserve account. Upon the forecast transaction / firm commitment subsequently resulting in the recognition of a non financial asset / liability, the associated gain / loss recognized in the hedge reserve account is transferred to the initial cost / carrying cost of the non financial asset / liability.

Premium on forward exchange contracts designated as hedging instruments is amortized as expense/income or adjustment to initial carrying cost of the hedged item over the life of the contract.

iv) IMPAIRMENT OF ASSETS (AS 28):

The "recoverable amount" is higher than the "carrying amount" of the cash generating units and hence there is no impairment of losses under AS - 28.

Ill) GENERAL

a) Figures for the previous year have been regrouped/restated/reclassified wherever necessary to conform to current year''s classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.

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Mar 31, 2012

Notes: 1. Cash Flow statement has been prepared following Indirect method

2. Figures of previous year has been regrouped/restated/reclassified wherever necessary

a)The Government of Tamil Nadu allotted land to TNPL for construction of Corporate Office building for Rs.44.37 lakh. The transfer of title of the said Land in favour of the company is yet to be done pending completion of necessary formalities.

b) The Company availed of lease finance for 4 Nos of 750KW capacity each Wind Electric Generators in 2001 with lease rentals payable upto 31.03.2007. The Company has not opted for a secondary lease and hence no provision is made for secondary lease rent in the books. The formal transfer of assets by the lessor to TNPL is pending completion of certain formalities.

c) The company has entered into an agreement with M/s. Sakthi Sugars Limited (SSL), Appakudal for procurement of bagasse on a fuel substitution. As per the terms of the agreement, TNPL would bear initially entire capital cost. The sugar mill has to reimburse the 50% of the capital cost and pay the same in 35 quarterly installments bearing interest @ 9%. On completion of the payment, TNPL and the sugar mill will have joint ownership and equal rights on the assets installed at Appakudal.

d) Additions to assets includes a sum of Rs.8448.87 lakhs towards adjustment of effects of changes in Foreign Exchange rates relating to Foreign Currency Long-term loans availed of for acquisition of depreciable fixed assets.

# Includes Rs.143.51 lakhs towards adjustment of effects of changes in Foreign Exchange Rates relating to Foreign Currency Long-Term loans availed of for acquisition of depreciable fixed assets.

* Excluding cost of Bagasse procured in lieu of steam/fuel supplied.

(Rs.in Lakh)

Note I As at As at Particulars 31/03/2012 31/03/2011

1 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

A) CONTINGENT LIABILITIES

a) Claims against the company not acknowledged as debts - Statutory Dues

i) Income-tax 2808.57 865.32

ii) Wealth Tax 19.46 19.46

iii) Custom Duty 271.21 271.21

iv) Excise Duty 27747.48 10600.95

b) Claims against the company not acknowledged as debts - Others

i) Corporate Office - Land 22.80 22.80

ii) Land Acquisition Claims 134.67 131.54

iii) Cess on Land Lease at Perungudi - Wind farm 37.94 37.94

iv) Interest on Water Royalty paid belatedly 82.48 82.48

v) Lease - Wind Mill 8.12 8.12

vi) Interest - ABFSL 138.24 138.24

vii) Property Tax 305.86 0.00

viii) Others 160.23 23.33

c) Concession in custom duty availed for imports cleared under EPCG Scheme 2187.07 4373.39

d) Revenue sharing agreement under captive plantation Non-Quantifiable

e) Guarantees issued by the banks on behalf of the Company 1520.00 1834.85

f) Letter of Credit issued by banks on behalf of the Company 9307.67 3926.26

44751.80 22335.89

B) COMMITMENTS

a) Estimated amount of contracts remaining to be executed on capital account and not provided for 2863.46 17759.52

2863.46 17759.52

Total 47615.26 40095.41

f) OTHER CURRENT LIABILITIES:

Other payables includes:

a) Rs.2410.35 lakh being the guarantee commission in respect of IBRD Loan guaranteed by Govt. of India lying since 2002

b) Rs.2119.69 lakh being Electricity Generation Tax for the generation of energy from captive generation plant for own use.

g) Confirmation of balances from Debtors, Creditors and for Loans and Advances have been received and the same is being reconciled

h) Farm Forestry Expenditure is charged-off to the Statement of Profit and Loss, in the year in which it is incurred, since it could not be matched with wood procured from farmers.

i) "Non Moving Stores & Spares

Stores and spares not drawn for use for more than three years as at the end of the year are charged to revenue. Such stores and spares are carried at nil value in the books and in the year of issue, charged to revenue at nil value.

j) i) Pursuant to insertion of paragraph 46A in Accounting Standard - 11 (AS-11) by the Companies (Accounting Standard) (Second Amendment) Rules, 2011 vide Notification GSR 913(E) & Notification No.GSR 914(E) dated 29-12-2011, issued by the Ministry of Corporate Affairs, Government of India, the Company has exercised the option of capitalizing the exchange losses on Long Term Foreign Currency Loans in relation to depreciable fixed assets with effect from 01-04-2011 and capitalized Rs.8592.38 lakh.

ii) If the company had followed the earlier accounting policy of charging such exchange losses to Statement of Profit and Loss, the profit before tax would have been lower by Rs.9560.81 lakh and the depreciation would have been lower by Rs.427.74 lakh.

iii) During the year, the Company had unwound the derivative contracts booked for hedging of Long-term Foreign Currency Loans. The net gain recognized in the Statement of Profit and Loss on account of unwinding of derivative contracts amounts to Rs.9988.55 lakh. This amount is disclosed as "Exceptional Item".

---

Mar 31, 2011

I. BALANCE SHEET:

A. FIXED ASSETS & CAPITAL WORK-IN-PROGRESS:

a) The Government of Tamil Nadu allotted land to TNPL for construction of Corporate Office building for Rs.44.37 lakh. The transfer of title of the said Land in favour of the company is yet to be done pending completion of necessary formalities.

b) The Company availed of lease finance for 4 Nos of 750KW capacity each Wind Electric Generators in 2001 with lease rentals payable upto 31.03.2007. The Company has not opted for a secondary lease and hence no provision is made for secondary lease rent in the books. The formal transfer of assets by the lessor to TNPL is pending completion of certain formalities.

d) Estimated amount of contracts remaining to be executed on Capital Account and not provided for is Rs. 17759.52 Lakh (Previous year Rs.11187.51 lakh).

e) The company has entered into an agreement with M/s. Sakthi Sugars Limited (SSL), Appakudal for procurement of bagasse on a fuel substitution. As per the terms of the agreement, TNPL would bear initially entire capital cost. The sugar mill has to reimburse the 50% of the capital cost and pay the same in 35 quarterly instalments bearing interest @ 9%. On completion of the payment, TNPL and the sugar mill will have joint ownership and equal rights on the assets installed at Appakudal.

B. CAPTIVE PLANTATIONS/FARM FORESTRY

a) The Company has taken over 244.28 hectares of waste land for captive plantation from the Government of Tamilnadu valid for a period ranging from 22 years to 30 years and 582.440 hectares from Private Land Owners for a period of six years through lease agreement and 1685.41 hectares under revenue sharing basis

d) Farm Forestry Expenditure

Farm Forestry Expenditure is charged-off to the Profit and Loss Account, in the year in which it is incurred, since it could not be matched with wood procured from farmers.

C. DEBTORS, CREDITORS AND LOANS & ADVANCES:

a) Confirmation of balances from Debtors, Creditors and for Loans and Advances, have been received and the same is being reconciled.

b) Based on confirmation received from the suppliers regarding status under the Micro, Small and Medium Enterprises Development Act, 2006 (the act)

a) Amount due and outstanding to suppliers as at the end of accounting year Rs.131.69 lakh

b) Interest paid during the year Nil

c) Interest payable at the end of the accounting year, and Nil

d) Interest accrued and unpaid at the end of the accounting year Nil

D. CURRENT LIABILITIES AND PROVISIONS:

Current Liabilities:

Other Liabilities: This includes Rs.24.10 Crore being the guarantee commission in respect of IBRD loan guaranteed by Govt, of India, lying since 2002.

Work-in-Process

Paper in process is valued at cost which includes cost of inputs,net of taxes and duties eligible for credit and overheads upto the stage of completion.

A. AS 15-Employee Benefit

a) The fair value of the asset of the provident fund trust including the return on the assets thereof, as on the balance sheet date is greater than the obligations under the defined contribution plan, as determined by the actuary and requires no further charge to profit and loss account.

G. IMPAIRMENT OF ASSETS (AS 28):

The "recoverable amount" is higher than the "carrying amount" of the cash generating units and hence there is no impairment of losses under AS - 28.

H. CONTINGENT LIABILITIES (AS 29):

(Rs. In Lakh)

Estimated Amount

SI. Description of the As at As at Indication of Possible No Contingent Liability 31.03.2011 31.03.2010 Uncertainty Recovery if liability arises

a) Letters of Credit issued by Banks on 3926.26 7125.72 Performance or behalf of Company Non-performance Nil of various parties.

b) Guarantees issued by the Banks on 1834.85 2648.92 -do- Nil behalf of the Company

c) Claims against the Company not All are disputed acknowledged as debts relating to before concerned Statutory Dues: - appellate

a) Income Tax 865.32 4267.44 authorities. The

b) Wealth-tax 19.46 19.46 company is Nil

c) Customs Duty 271.21 271.21 advised that the

d) Excise Duty 10600.95 9721.88 cases are likely to be disposed off in favour of the company.

d) Claims against the Company not acknowledged as debts - Others: -

i) Corporate Office Land - Penal Interest 22.80 22.80 All are disputed

ii) Land Acquisition Claims 131.54 130.00 before concerned

iii) Cess on Land Lease at Perungudi - Wind farm. 37.94 37.94 appellate

iv) Interest on Water Royalty Paid belatedly 82.48 82.48 authorities. The

v) Others 161.57 23.33 company is advised Nil that the cases are likely to be disposed off in favour of the company.

e) Concession in Customs Duty availed 4373.39 9855.60 Possibilities of for imports cleared under Export not meeting Promotion on Capital Goods Scheme minimum Nil export quantity requirements by the Company.

f) Revenue sharing agreement under captive plantation NQ NQ Yield and price payable not NIL quantifiable.

g) Lease 8.12 8.12 NIL

V. GENERAL:

a) Figures for the previous year have been regrouped/restated/reclassified wherever necessary to conform to current year's classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.

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Mar 31, 2010

A. FIXED ASSETS & CAPITAL WORK-IN-PROGRESS:

a) The Government of Tamil Nadu allotted land to TNPL for construction of Corporate Office building for Rs.44.37 lakh. The transfer of title of the said Land in favour of the company is yet to be done pending completion of necessary formalities.

b) The Company availed of lease finance for 4 Nos of 750KW capacity each Wind Electric Generators in 2001 with lease rentals payable upto 31.03.2007. The Company has not opted for a secondary lease and hence no provision is made for secondary lease rent in the books. The formal transfer of assets by the lessor to TNPL is pending completion of certain formalities.

B. CAPTIVE PLANTATIONS/ FARM FORESTRY

a) The Company has taken over 325.610 hectares of waste land for captive plantation from the Government of Tamilnadu valid for a period ranging from 22 years to 30 years and 437.858 hectares from Private Land Owners for a period of six years through lease agreements.

d) Farm Forestry Expenditure

Farm Forestry Expenditure is charged-off to the Profit and Loss Account, in the year in which it is incurred, since it could not be matched with wood procured from farmers.

C. DEBTORS, CREDITORS AND LOANS & ADVANCES:

a) Confirmation of balances from Debtors, Creditors and for Loans and Advances, received have been reconciled and suitably adjusted wherever necessary.

b) Based on confirmation received from the suppliers regarding status under the Micro, Small and Medium Enterprises Development Act, 2006 (the act)

a) Amount due and outstanding to suppliers as at the end of accounting year Rs.419.37 lakh

b) Interest paid during the year Nil

c) Interest payable at the end of the accounting year, and Nil

d) Interest accrued and unpaid at the end of the accounting year Nil

D. CURRENT LIABILITIES AND PROVISIONS:

Current Liabilities

Other Liabilities: This includes Rs.24.10 Crore being the guarantee commission in respect of IBRD loan guaranteed by Govt, of India, lying since 2002.

Work-in-Process

Paper in process is valued at cost which includes cost of inputs, net of taxes and duties eligible for credit and overheads upto the stage of completion, where as in the previous year, the same has been valued at variable cost. Had there been no change in the method of valuation, the stock-in-process for the year would have been lower by Rs. 100.37 lakh

ADMT = Air Dry Metric Tonne

@ Bagasse is procured both from open market and under barter arrangement with various sugar mills by exchange of fuel/coal. The value of bagasse represents the cost of procurement of bagasse from open market and cost of production of steam/fuel supplied to Sugar Mills in exchange for bagasse, freight, handling charges etc., which are included in the respective heads of account and is accounted for on depithed basis.

Bagasse consumption value and stock is valued at weighted average cost, net of taxes and duties eligible for credit. Where as in the previous year, bagasse was valued on FIFO basis. Had there been no change in the method of valuation, the stock of bagasse for the year would have been higher by Rs. 9.71 lakh.

III. ACCOUNTING STANDARD DISCLOSURES (COVERING SCHEDULE VI REQUIREMENTS ALSO):

A. AS 15 - Employee Benefit

a) The fair value of the asset of the provident fund trust including the return on the assets thereof, as on the balance sheet date is greater than the obligations under the defined contribution plan, as determined by the actuary and requires no further charge to profit and loss account.

G. IMPAIRMENT OF ASSETS (AS 28):

The "recoverable amount" is higher than the "carrying amount" of the cash generating units and hence there is no impairment of losses under AS - 28.

H. CONTINGENT LIABILITIES (AS 29):

(Rs. in lakh)

SI. Description of the Estimated Amount Indication of Possible No. Contingent Liability As at As at Uncertainty Recovery, if 31.03.2010 31.03.2009 liability a rises

a) Letters of Credit issued by Banks Performance or on behalf of Company 7125.72 39407.26 Non-performance of Nil various parties.

b) Guarantees issued by the Banks on behalf of the Company 2648.92 1932.40 -do- Nil

c) Claims against the Company not All are disputed before acknowledged as debts relating concerned appellate to Statutory Dues: - authorities. The ` company

i) Income Tax 4267.44 2745.19 is advised that the cases

ii) Wealth-tax 19.46 19.46 are likely to be disposed

iii) Customs Duty 271.21 271.21 off in favour of the company. Nil

iv) Excise Duty 9721.88 13249.66

d) Claims against the Company not acknowledged as debts - Others: -

i) Corporate Office Land - All are disputed before Penal Interest 22.80 22.80 concerned appellate

ii)Land Acquisition Claims 130.00 90.86 authorities. The company

iii)Cess on Land Lease is advised that the cases at Perungudi - Wind farm. 37.94 127.37 are likely to be disposed

iv)Interest on Water Royalty off in favour of the company. Nil Paid belatedly 82.48 82.48

v) Others 23.33 37.04

e) Concession in Customs Duty Possibilities of not meeting availed for imports cleared under minimum export quantity Export Promotion on Capital requirements by the Goods Scheme 9855.60 9132.43 Company. Nil

f) Revenue sharing agreement Yield and price payable not under captive plantation NQ NQ quantifiable. Nil

g) Lease 8.12 8.12 Nil



XIV. GENERAL:

a) Figures for the previous year have been regrouped/restated/reclassified wherever necessary to conform to current years classification.

b) Amounts have been rounded off to the nearest two decimal points of lakh of rupees.