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Notes to Accounts of Tide Water Oil Company India Ltd.

Mar 31, 2015

Notes : 1. The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard-3 on Cash Flow Statement issued by ICAI.

2. Cash and Cash Equivalent represent Cash and Bank Balances.

3. Additions to Fixed Assets are stated inclusive of movements of Capital Work-in-Progress between the beginning and end of the year and are treated as part of Investing Activities.

In terms of our report attached

NOTE 3 SHORT TERM LOANS & ADVANCES (UNSECURED)

Advance Payment of Tax and credits in respect of tax paid at source (net of Provision)

Advances recoverable in cash or in kind or for value to be received * Considered Good Considered Doubtful

3.1 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 1.31 Crores (previous year Rs. 1.01 Crores).

3.2 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31st March, 2015.

3.3 Corporate Social Responsibility

Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof :

a. Gross amount required to be spent by the Company during the year (2% of Net Profit) Rs. 1.89 Crores.

b. Amount spent during the year Rs. 0.57 Crores.

3.4 Pursuant to the enactment of Companies Act, 2013, the Company has applied the estimated useful lives as specified in Schedule II in respect of Tangible Assets. Accordingly, carrying amount is being depreciated or amortized over the remaining useful lives. The written down value of the fixed assets whose lives expired as at 1st April, 2014, have been adjusted, in the opening balance of General Reserve amounting to Rs. 2.29 Crores. The residual value of assets has been taken as nil.

In view of change in depreciation method from written down value to straight line method, depreciation for the year ended 31st March, 2015 is higher by Rs. 2.71 Crores and effect relating to the period prior to the 1st April, 2014 is Rs. 30.20 Crores, which has been shown as the ''Exceptional Item'' for the year ended 31st March, 2015.

3.5 During the year, the Company has entered into a Joint Venture agreement with JX Nippon Oil & Energy Corporation, Japan to form a Joint Venture Company to manufacture and sell lubricants under the brand name ''ENEOS''.

In pursuance of this joint venture agreement, a new Joint Venture Company named JX Nippon TWO Lubricants India Pvt. Ltd. was incorporated on 8th August, 2014.

Further, the Company has transferred ''Business Undertaking'' pertaining to Eneos business pursuant to the ''Business Transfer Agreement'' to JX Nippon TWO Lubricants India Pvt. Ltd. on 1st October, 2014 for a lump sum consideration of Rs.108 Crores as Slump Sale.

As a result of this transaction, a long term capital gain has accured during the year and has been shown as an ''exceptional item'' in the Statement of Profit & Loss.

3.6 During the year, the Company has transferred a land and building at Royapuram, Chennai on 9th October, 2014 at a lump sum consideration of Rs. 13.12 Crores.

As a result of this transaction, a long term capital gain has accured during the year and shown as an ''exceptional item'' in the Statement of Profit & Loss.

3.7 The Company had instituted a Tide Water Oil Company (India) Limited Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March 2011 for allotment of stock options to employees. The Scheme was kept in abeyance during the year.

The scheme was being administered by an independent Tide Watre Oil Co. (India) Ltd. Emplyee Welfare Trust (TWOC- EWT). The objective of the trust was acquiring shares from the secondary market and implementing the aforesaid scheme under the TWOC-EWS 2010-11.

In terms of clause 22A.1 of SEBI guideline 1999. "in case of ESOS/ESPS administered through a Trust, the accounts of the Company shall be prepared as if the company itself is administrating the ESOS/ESPS" and as per opinion of the Expert Advisory Committee of Institute of Chartered Accountants of India, the balance loan amounting to Rs. 16.50 Crores (Previous year Rs. 17.00 Crores) to TWOC-EWT in the books of the Company has been eliminated against loan paid to TWOC-EWT by means of book adjustment only.

Therefore 21,457 (previous year 21,457) nos. of equity shares held in trust for employees under the ESOP scheme as on 31 st March 2015, amounting Rs. 15.59 Crores (previous year Rs. 15.39 Crores) has been shown as deduction from Share Capital to the extent of face value of equity shares Rs. 0.02 Crores (previous year Rs. 0.02 Crores) and Securities Premium Reserve to the extent of Rs. 4.39 Crores (previous year Rs. 4.39 Crores) and remaining balance amount has been shown as deduction from General Reserve to the extent of Rs. 11.18 Crores (previous year Rs. 10.98 Crores).

Since the financial result of TWOC-EWT is included in standalone financial statements of the Company, the notional accumulated deficit of ESOP trust amounting Rs. 0.91 Crores (previous year Rs. 1.61 Crores) arising from the operation of the TWOC-EWT till 31st March 2015 has been adjusted with ''Surplus'' of the Company.

(d) Key Managerial Personnel

Mr. R. N. Ghosal, Managing Director Mr. S. Basu, Chief Financial Officer Mr. S Ganguli, Company Secretary

(e) Relative of Key Managerial Personnel

Mr. Saurav Ghosal, son of Mr. R. N. Ghosal

(B) Transactions with Related parties during the Financial year and outstanding balances are as below :

3.8 Employees Benefits :

(a) The Company''s contribution to Defined Contribution Plans aggregated to Rs.3.29 Crores (previous year Rs. 2.56 Crores) for the year ended has been recognised under the line item Contribution to Provident and Other Funds on Note 18 above.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(iii) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number of days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

(iv) Superannuation

Superannuation Scheme was provided in the accounts by the Company as Defined Benefit Retirement plan till 31st March, 2013.Now in view of policy of the Company and to reduce the risk due to Defined Benefits (DB) plan assets that may fall short of what is required to meet the obligations at the time of employee''s retirement, the Company has changed the remuneration policy as per board meeting dated 31.07.2013.

As per change in remuneration policy with effect from 1st August, 2007, the Scheme stands altered from Defined Benefit (DB) Scheme to a Defined Contribution (DC) Scheme. Consequently, with effect from 1st August,2007, the amount shall be calculated as under :

The sum accumulated in the name of the eligible members shall be calculated at the rate of 15% of basic salary upto 31st July, 2007. This shall, thereafter, be increased by the contribution by the Company with effect from 1st August, 2007, calculated at a rate not exceeding 4.87% of Basic and Dearness Allowance of the member till his date of superannuation. The Scheme is funded.

(v) Pension

The Company has a defined benefit pension fund. The Scheme is unfunded. This is not applicable to members in employment at present.

Notes :

(i) According to the Actuary, there will be no change in the aggregate of the current service cost and interest cost components of net periodic post employment medical cost for one percentage point increase or decrease in the assumed medical cost trends.

(ii) The Company has not received any break-up of the compositions of investment by category with respect to Gratuity Fund and Superannuation Fund administered and managed by Life Insurance Corporation of India and hence disclosure required for compositions of investment for plan assets under Accounting Standard 15 on Employee Benefits have not been given.

(iii) The estimate of future salary increases take into account inflation, seniority, promotion and other relevant reasons.

3.9 The disclosure under the Micro, Small & Medium Enterprise Development Act, 2006 have been made on the basis of confirmations received from suppliers regarding their status under the said Act :

2.10 Disclosures pertaining to Segment Reporting as per AS-17

Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard - 17, the Company is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of AS 17 on Segment Reporting are not applicable to the company.

3.11 Contribution to political party amounting to Rs. 0.01 Crores (Previous year NIL).

3.12 Previous year figures have been reclassified to conform to this year''s classification and have been regrouped and rearranged wherever necessary to make it comparable with the current year figures.


Mar 31, 2013

1.1 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 0.61 Crores (previous year Rs. 2.43 Crores).

1.2 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2013.

1.3 The Company''s significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The aggregate lease rentals charged to the Statement of Profit and Loss are Rs. 0.79 Crores (previous year Rs. 0.78 Crores). Expected future minimum commitments under such leases are shown below :

1.4 The Company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March 2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs.17.00 Crores to TWOC-EWT towards proposed purchase of Company''s shares from the market.

1.5 Loans and advances include Rs.3.48 Crores (previous year Rs.3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited(YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 Crores and the corresponding provision, if any, as may be required is not ascertainable at this stage.

1.6 The diminution in value of Long Term Investments amounting to Rs. 0.60 Crores (previous year Rs. 0.60 crores) is in the opinion of the management, not of a permanent nature and accordingly no provision has been made.

1.7 The details of transactions entered into with Related parties during the year are as follows :

(A) Name of Related parties :

(a) Subsidiary Companies

i) Veedol International Limited

ii) Veedol International DMCC

iii) Veedol International BV

(b) Associated Companies

i) Andrew Yule & Co. Ltd.

ii) Standard Greases & Specialities Pvt. Ltd.

(c) Key Managerial Personnel

Mr. R. N. Ghosal, Managing Director

(d) Relative of Key Managerial Personnel

Mr. S. Ghosal, son of Mr. R. N. Ghosal

1.8 Employees Benefits :

(a) The Company''s contribution to Defined Contribution Plans aggregated to Rs.2.15 Crores (previous year Rs. 1.57 Crores) for the year ended has been recognised under the line item Contribution to Provident and Other Funds on Note 19 above.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.8% to 2.2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

1.9 Disclosures pertaining to Segment Reporting as per AS-17

Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard - 17, the Company is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of AS 17 on Segment Reporting are not applicable to the company :

1.10 The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act,1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

1.11 Previous year figures have been reclassified to conform to this year''s classification and have been regrouped, recast and rearranged wherever necessary to make it comparable with the current year figures.


Mar 31, 2012

1.1 Contingent Liabilities

Contingent Liabilities not provided for : 31st March, 2012 31st March, 2011 (Rs.in crores) (Rs.in crores)

a. Bills Discounted 42.88 33.54

b. Income Tax 2.46 1.95

c. Sales tax / VAT 2.18 1.91

d. Excise Demands 0.65 0.65

e. Navi Mumbai Municipal Corporation cess 1.36 0.20

f. Bank Guarantees 0.05 0.05

g. Fringe Benifit tax 0.01 0.01

h. Other guarantees given to banks against 5.12 - financial facilities availed by subsidiaries

1.2 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 2.43 crores (previous year Rs. 3.58 crores).

1.3 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2012.

1.4 The Company's significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The aggregrate lease rentals charged to the Statement of Profit and Loss are Rs. 0.78 crores (previous year Rs. 0.73 crores). Expected future minimum commitments under such leases are shown below :

1.5 The company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March,2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs. 17 Crores to TWOC-EWT towards proposed purchase of Company's shares from the market.


Mar 31, 2011

1. CONTINGENT LIABILITIES

31st March, 2011 31st March, 2010

Contingent Liabilities not provided for:

Rs. Rs.

a. Bills Discounted 33.54 29.98

b. Income Tax 1.95 3.34

c. Sales tax/VAT 1.91 2.09

d. Excise Demands 0.65 0.65

e. Other disputed claims 0.20 0.20

f. Bank Guarantees 0.05 0.08

2. The Company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2011.

3. The Companys significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The agreeable lease rentals charged to the profit and loss account are Rs. 0.73 (last year Rs. Nil). Expected future minimum commitments under such leases are shown below.

4. The company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March,2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the Trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs. 17 Crores to TWOC-EWT towards proposed purchase of Companys shares from the market.

5. Loans and advances include Rs. 3.48 Crores (last year Rs. 3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited (YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 Crores and the corresponding provision, if any, as may be required is not ascertainable at this stage.

6. The diminution in value of Long Term Investments amounting to Rs. 0.60 Crores (last year Rs. 0.60 Crores) is in the opinion of the management, not of a permanent nature and accordingly no provision has been made.

7. Related Party Disclosures

(a) Key Managerial Personnel

Mr. R.N. Ghosal, Executive Director of the Company is considered as Key Managerial Personnel.

(b) Relative of Key Managerial Personnel Mr. S.Ghosal, son of Mr. R.N. Ghosal

(c) Associate Companies AndrewYule&Co.Ltd.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.8% to 2.2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

8. Figures for the previous year have been rearranged / regrouped wherever necessary, to conform to current year classifications.


Mar 31, 2010

1. CONTINGENT LIABILITIES

Contingent Liabilities not provided for :

31st March, 2010 31st March,2009

Rs. Rs.

a. Bills Discounted 29.98 22.65

b. Income Tax 3.34 7.60

c. Sales tax/VAT 2.09 1.43

d. Excise Demands 0.65 0.53

e. Other disputed claims Nil 0.02

f. Bank Guarantees 0.08 0.08

2. Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 2.44 Crores (last year Rs. 8.16 Crores).

3. During the year, Company has started a new line of business of sale of Wind Power to Tamil Nadu Electricity Board (TNEB). Two Power Generation units of 1.5 MW each, have been set up at Sankenari, Tamil Nadu, which has been commissioned and connected to TNEB grid.

The company has an agreement with Suzlon Energy Ltd. for operation and maintenance of the power units.

4. The Company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2010.

5. Loans and advances include Rs.3.48 Crores (last year Rs3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited (YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 and the corresponding provision, if any, as may be required is not ascertainable at this stage.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act,1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.67% to 2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

Notes :

(i) According to the Actuary, there will be no change in the aggregate of the current service cost and interest cost components of net periodic post employment medical cost for one percentage point increase or decrease in the assumed medical cost trends.

(ii) The Company has not received any break-up of the compositions of investment by category with respect to Gratuity Fund and Superannuation Fund administered and managed by Life Insurance Corporation of India and hence disclosure required for compositions of investment for plan assets under Accounting Standard 15 on Employee Benefits have not been given.

(iii) The estimate of future salary increases take into account inflation, seniority, promotion and other relevant reasons.

6. Figures for the previous year have been rearranged /regrouped wherever necessary, to confirm to current year classifications.

 
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