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Notes to Accounts of Ultramarine & Pigments Ltd.

Mar 31, 2015

1. CORPORATE INFORMATION

Ultramarine & Pigments Limited ("the Company") is a public limited company domiciled in India incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The Company is engaged in manufacturing and selling of pigments, surfactants, IT enabled services and Business Process Outsourcing (BPO) activities. The Company caters to both domestic and international markets.

2. Terms/rights attached to equity shares

(a) The Company has only one class of share referred to as equity shares having a par value of Rs.2/-. Each holder of equity shares is enttiled to one vote per share.

(b) The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

(c) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amount. The distribution will be proportionate to the number of equity shares held by the share holders.

(d) There is no change in issued and paid up share capital during the year

(Amount in rupees) Year ended Year ended 31.03.2015 31.03.2014

3. Other disclosures as per revised schedule VI

3.1. Contingent liabilities and commitments (to the extent not provided for)

(a) Contingent liabilities

(i) Claims against the Company/disputed liabilities not acknowledged as debts in respect of labour disputes 480,000 480,000

(ii) Bank Guarantees issued and outstanding 904,007 478,381

(iii) Letter of Credit issued and outstanding - -

(b) Commitments

(i) Estimated amount of contracts remaining to be executed on capital

account and not provided for 5,911,115 -

Against which advance paid 2,425,000 -

The Company had entered into an agreement on 28th April, 2011 with Gujarat Industrial Development Corporation (GIDC) for allotment of land at Dahej. The Company has acquired the land at Dahej-Petroleum, Chemicals and Petro Chemicals Investment Region (PCIR) in Gujarat with the intention of expanding its surfactant chemicals manufacturing and processing operations. As per the said agreement, the Company within a period of two years from the agreement date is required to build factory. However, due to delay in the availability of adequate infrastructure (including water supply), the proposed expansion is likely to be delayed. As per the agreement with the GIDC the Company is liable to pay penalty for delay in implementation of the project. As on 31st March 2015, Rs.13,29,770/- (P.Y. Rs.13,29,770/-) has been outstanding in the books of account towards the same.

However, due to Government land passing through the said plot, corrigendum order for the same was issued on 28/01/2014 and physical possession of the plot was received only on 02/05/2014. Since the Company has two years time period from the date of revised agreement to build factory, provision for penalty for delay in implementation of the project is not required for the year 2014-15.

(c) No provision has been made in respect of the following demands raised by the authorities since the Company has reasons to believe that it would get relief at the appellate stage as the said demands are excessive and erroneous

(i) By the Income tax authorities [Rs. 5,64,64,894/- (PY Rs. 5,70,61,890/-) deposited with tax authorities] 69,286,277 57,061,890

(ii) Interest and penalty on account of the alleged delay in payment of dues under the ESI Act. 108,119 108,119

(iii) Sales Tax Authorities 1,121,128 1,015,810

4. Other Notes:

4.1 Changes in accounting estimates

Effective April 1, 2014, the Company has revised the estimated useful life of certain items of fixed assets in accordance with the useful life specified in Part C of Schedule II to the Companies Act, 2013 or as re-assessed by the Company. As per the said Schedule, where the fixed asset have completed their useful lives, the carrying value(net of residual value) as at April 1, 2014 of Rs. 88,69,898 (net of deferred tax) has been recognized/ adjusted in the opening surplus and in case of other fixed assets the carrying value( net of residual value) as at April 1, 2014 is being depreciated/amortized over the remaining useful life. The depreciation/amortization expense over the year ended march 31st 2015, would have been higher by Rs. 2,58,94,433/- had the Company continued with the previously assessed useful lives of such assets.

4.2

The Company's pending litigations comprise of claims against the Company by the parties and proceedings pending with Revenue authorities. The Company has reviewed all its pending litigations and proceedings and has adequately provided for where provisions are required and disclosed the contingent liabilities where applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a materially adverse effect on its financial results. Refer Note 4.1 for details on contingent liabilities.

5. Disclosures in accordance with Accounting Standards (AS)

5.1 (AS)-15 Employee benefits Defined contribution plans

The Company makes Provident Fund and Superannuation Fund conributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable by the Company are at rates specified in the rules of the schemes.

Other Long Term benefits

The Company's Long Term benefit includes Leave encashment payable at the time of retirement in full, or encashable during the year in which services are rendered subject to limit of 180 days. Present value of obligation as at the beginning of the year is Rs.16,596,079 ( Prev. Year Rs. 15,660,667 ) and the actuarial gains and losses recognised in full in the Statement of Profit and Loss is Rs.4,106,839 ( Prev. Year Rs.935,452 ). The present value of obligation as at March 31,2015 is Rs.19,105,845 ( Prev. Year Rs. 16,596,079 )

The estimates of future salary increases considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

5.2 Disclosure requirement of Accounting Standard 17 "Segment Reporting".

a. Primary Segments

The Company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system. The Company's operations predominantly relate to manufacture of Laundry and Allied products and its intermediaries and providing IT Enabled Services & BPO activities and generation of power from wind turbine.

b. Secondary Segments

The Company caters mainly to the needs of the domestic market. The export turnover is not significant (except IT Enabled Services Division) in the context of total turnover. As such there are no reportable geographical segments. The income from IT Enabled Services is pre-dominantly from exports.

c. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. The expenses, which are not directly attributable to the business segment, are shown as unallocated / corporate cost.

d. Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated / corporate assets and liabilities respectively.

5.3 Related Party Disclosures as required by AS 18 of Companies (Accounting Standards) Rules 2006 is as follows:

(A) Related Parties and Relationship

(a) Companies in which the company has substantial interest (i.e more than 20% in voting power directly or indirectly)

Thirumalai Chemicals Limited. Lapiz Inc, U.S.A.

(b) Other related parties

Thirumalai Charity Trust Chempak Industries Hamsa Investments Associates Pvt. Ltd. Varadaraja Credits & Investments Pvt. Ltd. Meera Parthasarathy S. Srinath

(c) Key Management Personnel:

Mr. R.Sampath, Chairman & Managing Director

Mrs. Indira Sundararajan, Vice Chairman & Managing Director

Mr. S. Sridhar, Joint Managing Director

Ms. Tara Parthasarathy, Joint Managing Director

Mr. V. Bharathram, President(Operations), IT-Enabled Services and BPO activities Division.

Mr.B.Sreenivasacharyulu - Vice President - Operation & New Business

5.4 Disclosures as required by AS 27 financial reporting of interest in joint ventures.

The Company has investments in a jointly controlled entity as per the following details: Name and Country of Incorporation : LAPIZ INC, USA.

Proportion of ownership interest : 35.00%

Proportionate share for the year ended 31st March 2015 in respect of

i. Assets Rs. 6,956,419 (Prev. Year Rs. 15,683,453)

ii. Liabilities Rs. 5,327,672 (Prev. Year Rs. 14,282,171)

iii. Income Rs. 49,274,857 (Prev. Year Rs. 72,981,330)

iv. Expenses Rs. 49,102,551 (Prev. Year Rs. 72,188,515)

3. Expenditure towards Corporate Social Responsibility activities:

a) Gross amount required to be spent by the Company during the year: Rs. 38,14,355/-

b) Amount spent during the year: Rs. 57,50,000/- contributed to Thirumalai Charity Trust registered u/s 35AC of Income Tax Act 1961, engaged in rural healthcare, women empowerment, disability, de-addiction and village development,surrounding the manufacturing location of the company.

4. The Company has an associate company viz., Lapiz Inc.. As per the Notification number GSR-E 723 dated 14th October, 2014 issued by the Ministry of Company Affairs, a company which does not have a subsidiary but has one or more associate companies is not required to prepare consolidated financial statements for the financial year 2014-15. Accordingly, the Company has not prepared consolidated financial statements in the current financial year.

5. Director's remuneration includes the sum of Rs. 1.33 lacs paid to Ms. Tara Parthasarthy, joint managing director, whose appointment is subject to approval by the shareholders in the ensuing annual general meeting.

6. Previous years figures have been regrouped / reclassified wherever necessary to correspond with the current years classification / disclosure.


Mar 31, 2014

A. CORPORATE INFORMATION

Ultramarine & Pigments Limited(''''UPL" or "the Company") is a public limited company domiciled in India incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The Company is engaged in manufacturing and selling of pigments, surfactants, IT enabled services and Business Process Outsourcing (BPO) activities. The Company caters to both domestic and international markets.

Note 1 : Other disclosures as per revised schedule VI

Note 1.1 : Contingent liabilities and commitments (to the extent not provided for)

(a) Contingent liabilities

(i) Claims against the Company/disputed liabilities no acknowledged as debts in respect of labour disputes 480,000 480,000

(ii) Bank Guarantees issued and outstanding 478,381 380,000

(b) Commitments

(i) Estimated amount of contracts remaining to be executed on capital account and not provided for - 2,015,177

Against which advance paid - 441,700

(ii) Import duty on Goods imported under advance licence pending fulfillment of export obligation - 5,683,937

(iii) The Company had entered into an agreement on 28th April, 2011 with Gujarat Industrial Development Corporate on (GIDC) for allotment of land at Dahej. The Company has acquired the land at Dahej-Petroleum, Chemicals and Petro Chemicals Investment Region (PCIR) in Gujarat with the intent on of expanding its surfactant chemicals manufacturing and processing operations. As per the said agreement, the Company within a period of two years from the agreement date is required to build factory. However, due to delay in the availability of adequate infrastructure (including water supply), the proposed expansion is likely to be delayed. As per the agreement with the GIDC the Company is liable to pay penalty for delay in implementation of the project. As on 31st March 2014, Rs. 13,29,770 has been provided for in the books of account towards the same.

Note 2 : Disclosures in accordance with Accounting Standards (AS)

Note 2.1 : (AS)-15 Employee benefits

Defined contribution plans

The Company makes Provident Fund and Superannuation Fund contributions to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The contributions payable by the Company are at rates specified in the rules of the schemes.

Other Long Term benefits

The Company''s Long Term benefit includes Leave encashment payable at the t me of ret rement in full, or encashable during the year in which services are rendered subject to limit of 90 days. Present value of obligation as at the beginning of the year is Rs.15,660,667 (Prev. Year Rs. 13,960,343) and the actuarial gains and losses recognised in full in the Statement of Profit and Loss is Rs. 935,452 (Prev. Year Rs.1,700,284). The present value of obligation as at March 31,2014 is Rs. 16,596,079 (Prev. Year Rs. 15,660,627).

The estimates of future salary increases considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

Note 2.2 : Disclosure requirement of account ng Standard 17 "Segment Reporting" issued under Companies (Account ng Standards) Rules 2006.

a. Primary Segments

The Company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system. The Company''s operations predominantly relate to manufacture of Laundry and Allied products and its intermediaries and providing IT Enabled Services & BPO activities and generation of power from wind turbine.

b. Secondary Segments

The Company caters mainly to the needs of the domestic market. The export turnover is not significant (except IT Enabled Services Division) in the context of total turnover. As such there are no reportable geographical segments. The income from IT Enabled Services is pre-dominantly from exports.

c. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. The expenses, which are not directly attributable to the business segment, are shown as unallocated corporate cost.

d. Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively.

e. Inter Segment transfers are made on cost plus basis.

Note 2.3 : Related Party Disclosures as required by AS 18 of Companies (Accounting Standards) Rules 2006 is as follows:

(A) Related Parties and Relationship

(a) Companies in which the company has substantial interest (i.e more than 20% in voting power directly or indirectly)

Thirumalai Chemicals Limited

Lapiz Inc, U.S.A.

(b) Other related part es Thirumalai Charity Trust Chempak Industries

Hamsa Investments Associates Pvt. Ltd. Varadaraja Credits & Investments Pvt. Ltd. Meera Parthasarathy S. Srinath

(c) Key Management Personnel:

Mr. R. Sampath, Chairman & Managing Director

Mr. S. Sridhar, Joint Managing Director

Mrs. Indira Sundararajan, Whole time Director

Mr. V. Bharatram, President(Operations), IT-Enabled Services and BPO act vit es Division.

Mr. B. Sreenivasacharyulu - Senior General Manager

Note 3.1 : Previous years figures have been regrouped / reclassified wherever necessary to correspond with the current year`s classification / disclosure.


Mar 31, 2013

1 CORPORATE INFORMATION:

ULtramarine & Pigments Limited (''''UPL" or "the Company") is a pubLic Limited company domiciLed in India incorporated under the provisions of the Companies Act, 1956. Its shares are Listed on Bombay Stock Exchange in India. The Company is engaged in manufacturing and seLLing of pigments, surfactants, and aLso engaged in IT enabLed services. The Company caters to both domestic and internationaL markets.

Terms/rights attached to Equity Shares

(a) The Company has only one cLass of share referred to as equity shares having a par vaLue of Rs. 2/-. Each hoLder of equity shares is enttiLed to one vote per share.

(b) The Company decLares and pays dividends in Indian rupees. The dividend proposed by the Board of directors is subject to the approvaL of the sharehoLders in the ensuing AnnuaL GeneraL Meeting. During the year ended 31st March, 2013 the amount per share dividend recognised as distribution to equity sharehoLders was Rs. 2.25 (Previous year Rs. 3/-)

(c) In the event of Liquidation of the Company, the hoLders of equity shares wiLL be entitLed to receive any of the remaining assets of the Company, after distribution of aLL preferentiaL amount. The distribution wiLL be proportionate to the number of equity shares heLd by the share hoLders.

(d) There is no change in issued and paid up share capitaL during the year

Notes:

(a) An exclusive charge by way of hypothecation over Wind Turbine Generators, acquired / to be acquired by the company and second pari passu charge by way of hypothecation of the Company''s other movable fixed assets and books debts.

(b) Repayable in twelve quarterly equal instalments starting from 20th Mar 2012 of Rs. 66,66,667/- with interest @ 11.50% .

(c) Repayable to Gujarat Industrial Development Corporation in twelve quarterly equal instalments starting from 30th June 2011 of Rs. 27,75,645/- with interest @ 13.50% .

(iii) The company had entered into an agreement on 28th April, 2011 with Gujarat Industrial Development Corportation for allotment of land at Dahej. The company has acquired the land at Dahej-Petroleum, chemicals and petro chemicals investment region (PCPIR) in Gujarat with the intention of expanding its surfactant chemicals manufacturing and processing operations. As per the said agreement, the company within a period of two years from the agreement date build and completely finish it for occupation of building to be used as industrial factory. However, due to delay in the availability of adequate infrastructure (including water supply), it was decided to defer the proposed expansion for some time. As per the agreement with the GIDC the company has to pay penalty for delay in implementation of the project. As on 31st March 2013, Rs. 13,29,770 has been provided for in the books of account towards this.

Note 2.1 : (AS)-15 Employee benefits

Defined contribution pLans

The Company makes Provident Fund and Superannuation Fund contributions to defined contribution pLans for quaLifying empLoyees. Under the Schemes, the Company is required to contribute a specified percentage of the payroLL costs to fund the benefits. The Company recognised Rs. 12,170,492 (Year ended 31 March, 2012 Rs. 10,959,457) for Provident Fund contributions and Rs. 3,427,114 (Year ended 31 March, 2012 Rs. 3,239,355) for Superannuation Fund contributios in the Statement of Profit and Loss. The contributions payabLe by the Company are at rates specified in the ruLes of the schemes.

Other Long Term benefits

The Company''s Long Term benefit includes Leave encashment payable at the time of retirement in full, otherwise it is encashable during the year in which services are rendered subject to in excesss of 90 days. Present value of obligation as at the beginning of the year is Rs. 13,960,343 (Prev. Year Rs. 8,757,114) and the actuarial gains and losses are recognised in full in the Profit and Loss account for Rs. 1,700,284 (Prev. Year Rs. 5,203,229). The present value of obligation as at March 31, 2013 is Rs. 15,660,627 (Prev. Year Rs. 13,960,343)

The estimates of future salary increases considered in actuarial valuation take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

Note 2.2 : Disclosure requirement of accounting Standard 17 "Segment Reporting" issued under Companies (Accounting Standards) Rules 2006.

a. Primary Segments

The Company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system. The Company''s operations predominantly relate to manufacture of Laundry and Allied products and its intermediaries and providing IT Enabled Services.

b. Secondary Segments

The Company caters mainly to the needs of the domestic market. The export turnover is not significant (except IT Enabled Services Division) in the context of total turnover. As such there are no reportable geographical segments. The income from IT Enabled Services is pre-dominntly from exports.

c. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. The expenses, which are not directly attributable to the business segment, are shown as unallocated corporate cost.

d. Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively.

e. Inter Segment transfers are made on cost plus basis.

2.3 : AS 19 Details of Leasing arrangements

The Company has taken premises for office use and godown under cancellable lease agreements. The total lease rentals recognised as expense during the year Rs. 28,215,040 (Prev. Year Rs. 24,643,185).

As per the above lease agreements the rent and car parking charges will be enhanced by 15% over the last paid rent at the end of thrity six months from the date of commencement of the lease agreement. The option to renew the lease deed for a further period shall be at the sole option of the lessee to be excercised by giving six months prior notice in writing before the end of lease term of sixty months from the date of commencement of lease.


Mar 31, 2012

1 CORPORATE INFORMATION:

Ultramarine and Pigments Limited is a public limited company domiciled in India, incorporated under the provisions of the Companies Act, 1956. Its shares are listed in Bombay Stock Exchange Ltd, India. The company is engaged in manufacturing and selling of pigments, surfactants, and also engaged in IT enabled services. The company caters to both domestic and international markets.

(a) Terms/rights attached to Equity Shares

The Company has only one class of share referred to as equity shares having a par value of Rs 2/-. Each holder of equity shares is enttiled to one vote. per share In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amount. The distribution will be proportionate to the number of equity shares held by the share holders.

(b) There is no change in issued and paid up share capital during the year.

(c) Bonus shares

34,50,000 Equity shares of Rs 10/- each (later divided into 1,72,50,000 equity shares of Rs 2/- each) allotted as fully paid bonus shares by capitalisation of General Reserve in the year 2005-06.

Notes:

(a) An exclusive charge by way of hypothecation over windturbine generators, acquired / to be acquired by the company and second pari passu charge by way of hypothecation of the Company other movable fixed assets including books debts.

(b) Repayable in twelve quarterly equal instalments starting from 20th Mar 2012 of Rs 66,66,667/- with interest @ 11.50%.

(c) Repayable to Gujarat Industrial Development Corporation in twelve quarterly equal instalments starting from 30th June 2011 of Rs 27,75,645/- with interest @ 13.50%.

Notes:

(a) Cash credit / Export credit facilities is secured by hypothecation of stock of raw materials, work in progress, finished goods, packing materials, stores and spares and book debts of the company and secured by a second charge on the immovable properties.

Note

Amount due is fully secured by equity instruments having market value of Rs 7,06,837/- (previous year Rs 9,34,288/-), including those shares the market value of which Rs 6,58,350/- (previous year Rs 8,75,490/-) which are transferred in the name of the company.

As at As at

31.03.2012 31.03.2011

Note 4 : Other disclosures as per revised Schedule VI Note 4.1 :Contingent liabilities and commitments (to the extent not provided for)

(a) Contingent liabilities

(i) Claims against the Company/ disputed liabilities not acknowledged as debts in respect 1,680,000 1,680,000 of labour disputes

(ii) Bank Guarantee issued and outstanding 624,005 350,000

(iii)Letter of Credit issued and outstanding 584,820 Nil

(b) Commitments

(i) Estimated amount of contracts remaining to be executed on capital account and not 3,103,187 9,846,863 provided for

Against which advance paid 660,406 2,864,150

(ii) Import duty on Goods imported under advance licence pending fulfilment of export 5,683,937 5,683,937 obligation

(c) No provision has been made in respect of the following demands raised by the authorities since the company has reasons to believe that it would get relief at the appellate stage as the said demands are excessive and erroneous

(i) By the Income tax authorities 42,443,045 42,443,045 Against which amount already paid. 28,627,516 12,627,516

(ii) Central Excise duty and penalty. 5,556,114 5,556,114

(iii) Interest and penalty on account of the alleged delay in payment of dues under the ESI Act. 108,119 108,119

Note 5.1 : (AS)-15 Employee benefits

Defined contribution plans

The Company makes Provident Fund and Superannuation Fund contribution to defined contribution plans for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs 10,267,993 (Year ended 31 March, 2011 Rs 7,470,975) for Provident Fund contributions and Rs 3,239,355 (Year ended 31 March, 2011 Rs 2,790,505) for Superannuation Fund contributios in the Statement of Profit and Loss. The contributions payable by the Company are at rates specified in the rules of the schemes.

The Company's Long Term benefit includes Leave encashment payable at the time of retirement in full, otherwise it is encashable during the year in which services are rendered subject to in excesss of 90 days. Present value of obligation as at the beginning of the year is Rs 8,757,114 (Prev. Year Rs 7,326,711) and the actuarial gains and losses are recognised in full in the Profit and Loss account for Rs 5,203,229 (Prev. Year Rs 1,430,403). The present value of obligation as at March 31,2012 is Rs 13,960,343 (Prev. Year Rs 8,757,114)

The estimates of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors

Note 5.2 : Disclosure requirement of accounting Standard 17 "Segment Reporting" issued under Companies (Accounting Standards) Rules 2006.

a. Primary Segments

The company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system. The company's operations predominantly relate to manufacture of Laundry and Allied products and its intermediaries and providing IT Enabled Services.

b. Secondary Segments

The company caters mainly to the needs of the domestic market. The export turnover is not significant (except IT Enabled Services Division) in the context of total turnover. As such there are no reportable geographical segments. The income from IT Enabled Services is pre-dominantly from exports.

c. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. The expenses, which are not directly attributable to the business segment, are shown as unallocated corporate cost.

d. Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively.

Note 5.3 : Related Party Disclosures as required by AS 18 of Companies (Accounting Standards) Rules 2006 is as follows:

A. Related Parties and Relationship

(a) Companies in which the company has substantial interest (i.e more than 20% in voting power directly or indirectly) Thirumalai Charity Trust

Lapiz Inc, U.S.A.

(b) Other related parties

Thirumalai Chemicals Limited.

Chempak Industries

Hamsa Investments Associates Pvt. Ltd.

Varadaraja Credits & Investments Pvt. Ltd.

Ms. Meera Parthasarathy

(c) Directors of the Company

Mr. R. Sampath, Chairman & Managing Director

Ms. Indira Sundararajan, Wholetime Executive Director

Mr. S. Santhanam

Mr. S. Sridhar

Mr. Nimish Patel

Mr. M. C. Choksi

Dr. G. G. Nair

Ms. K. R. Javeri

(d) Key Management Personnel

Mr. V. Bharatram, President(Operations), IT - Enabled Services Division.

Mr. B. Sreenivasacharyulu - Senior General Manager

5.4 : AS 19 Details of Leasing arrangements

The Company has taken premises for office use and go down under cancellable lease agreements. The total lease rentals recognised as expense during the year Rs 19,071,721 (Prev. Year Rs 4,284,283).

As per the above lease agreements the rent and car parking charges will be enhanced by 15% over the last paid rent at the end of thirty six months from the date of commencement of the lease agreement. The option to renew the lease deed for a further period shall be at the sole option of the lessee to be exercised by giving six months prior notice in writing before the end of lease term of sixty months from the date of commencement of lease.

6.1 : Disclosures required as per Micro, Small and Medium Enterprises Development Act, 2006.

Sundry Creditors include due to Micro and Small Enterprises to whom the company owes amounts outstanding for more than 45 days. The above information regarding Micro and Small Enterprises had been determined to the extent such parties have been identified.

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


Mar 31, 2010

As at As at 31.03.2010 31.03.2009 Rs. Rs.

1. Contingent Liability in respect of

a. Estimated amount of contracts to be executed on capital 2,120,772 2,394,886 account and not provided for

Against which advances paid 710,467 2,394,886

b. Bank Guarantees issued and outstanding 726,000 786,040 c. Letter of Credit issued and outstanding 26,051,200 -

d. Import duty / Excise Duty on Capital Goods against fulfilment 6,364,153 7,184,496 of export obligations

e. Import duty on Goods imported under advance licence pending fulfilment 183,665 183,665 of export obligation

2. No provision has been made in respect of the following since the company has reasons to believe that it would get relief at the appellate state as the said demands are excessive and erroneous:

Disputed demands from Income Tax Authorities to the extent of Rs. 6,071,405 (Prev.Year .8,897,963 ), against which amount already paid Rs.6,730,469 (Prev.Year Rs.8,715,633 .

3. In the opinion of the Board, the current assets, loans and advances are approximately of the value stated in the ordinary course of business. The provision for depreciation and all known liabilities is adequate and not in excess of amount reasonably nece ssary.

4. Provision for current tax includes provision for wealth tax Rs.50,000 (Previous Year Rs.65,000)

5. Sundry Debtors include an amount due from a party of Rs. 356,620 (Previous Year Rs.363,220) which is fully secured by shares having market value of Rs. 650,938 (Previous Year Rs.2,30,913), including shares of the value of Rs. 576,620 (Previous Year Rs.201,575) already transferred to the name of the company

6. Unpaid dividend ( included in Current Liabilities Schedule 11) represent amounts to be credited to the Investor Education and Protection Fund as and when they become due.

7. Disclosure requirement of accounting Standard 17 "Segment Reporting" issued under Companies (Accounting Standards) Rules 2006.

a. Primary Segments

The company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system. The companys operations predominantly relate to manufacture of Laundry and Allied products and its intermediaries and providing IT Enabled Services.

b. Secondary Segments

The company caters mainly to the needs of the domestic market. The export turnover is not significant (except IT Enabled Services Division) in the context of total turnover. As such there are no reportable geographical segments. The income from IT Enabled Services is pre-dominntly from exports.

c. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. The expenses, which are not directly attributable to the business segment, are shown as unallocated corporate cost.

d. Assets and Liabilities that cannot be allocated between the segments are shown as a part of unallocated corporate assets and liabilities respectively.

8. Other Long Term benefits

The Companys Long Term benefit includes Leave encashment payable at the time of retirement in full, otherwise it is encashable during the year in which services are rendered subject to in excesss of 90 days. Present value of obligation as at the beginning of the year is Rs.6,315,746 (PreviousYear Rs. 76,13,232) and the actuarial gains and losses are recognised in full in the Profit and Loss account for Rs.1,010,964 (Previous Year Rs. 13,82,509). The present value of obligation as at March 31, 2010 is Rs.7,326,710 (Previous Year Rs. 62,30,723). The estimates of future salary increases considered in actuarial valuation takes into account inflation, seniority, promotion and other relevant factors

9. Related Party Disclosures

Related Party Disclosures as required by AS 18 of Companies (Accounting Standards) Rules 2006 is as follows: (A) Related Parties and Relationship

(a) Companies in which the company has substantial interest (i.e more than 20% in voting power) directly or indirectly

Thirumalai Chemicals Ltd.

Thirumalai Charity Trust

Lapiz Inc.

(b) Other related parties Chempak Industries

Hamsa Investments Associates Pvt. Ltd. Varadaraja Credits & Investments Pvt. Ltd. Meera Parthasarathy

(c) Directors of the Company

Mr. R.Sampath, Chairman & Managing Director Mrs. Indira Sundararajan, Executive Director Mr. S.Santhanam Mr. S.Sridhar Mr. Nimish Patel Mr. M.C.Choksi Dr. G.G.Nan- Ms. K.R.Javeri

(d) Key Management Personnel

Mr. V.Bharatram, Vice-President (Operations), IT Enabled Services Division Mr. B.Sreenivasacharyulu - General Manager - Mfg.

26. Disclosures as required by Accounting Standard (AS) 27 Financial reporting of Interest in Joint Venture

The Company has investments in a jointly controlled entity as per the following details 1. a. Name and Country of Incorporation : LAPIZ INC, USA

b. Proportion of ownership interest : 35.00%

c. Proportionate share for the year ended 31st March 2010 in respect of

i. Assets Rs. 12,946,559 (Prev. Year Rs. 19,378,705)

ii. Liabilities Rs. 14,553,028 (Prev. Year Rs. 21,588,349)

iii. Income Rs. 44,365,898 (Prev. Year Rs. 52,340,077)

iv. Expenses Rs. 43,937,932 (Prev. Year Rs. 54,774,307)

10. The company has an investment of Rs.89,800,000 in ordinary share of TCL Industries (Malaysia) Sdn Bhd (TCLM). TCLM had been making losses on the manufacture of Maleic Anhydride (MAN) due to the high prices of Benzene feedstock and as on 31s December 2007, its net worth had been eroded. In January 2008, TCLM successfully commissioned its plant for the manufacture of MAN from Butane instead of Benzene, which was expected to make TCLM competitive with other MAN manufacturers. However, with the global meltdown in Sep-Dec 2008, TCLM had to close operations as its operations became unviable. As a result, one of the unsecured creditors of TCLM appointed a provisional liquidator on 2nd January 2009. At the meeting of creditors and shareholders of TCLM on 3,d February 2009, the appointment of the provisional liquidator was confirmed. In view of the above developments, the realisability of the investment in TCLM is highly uncertain. The Board of Directors of the Company therefore in their meeting dated 23.12.2008 decided to write down the said innestrment of Rs. 89,800,000 aganist the Amalgamation Reserve General Reserve and Capital Reserve of the Company.

After obtaining approval of Shareholders in the Extraordinary General Meeting held on 9,h March, 2009 for the same, the company filed a petition u/s 78, 100 to 104 of the Companies Act, 1956 before the Honble High Court of Bombay to adjust the said amount against the Reserves of the Company. The Honble High Court of Bombay approved the above adjustment vide its order dated 5lh August 2009. The said scheme of adjustment became effective after the order of the Honble High Court of Bombay was filed with the Registrar of Companies, Mumbai.

In terms of the said order of the Honble High Court of Bombay, the investment of Rs. 89,800,000/- in TCLM was adjusted as under:

Amalgamation Reserve: 95,13,439 Capital Reserve : 1,000,000

General Reserve : 7,92,86,561

Had the Company followed the provisions of AS 13 Accounting for Investments as prescribed by the Companies (Accounting Standards) Rules, 2006, the write-down in the value of the investment in TCLM would have to be charged to the Profit and Loss A/c with corresponding reduction in the profit for the year,

11. Disclosures as Required Under Clause 32 of The Listing Agreement Loans and Advances / Sundry Debtors include

Amount receivable from Associates

a) Thirumalai Chemicals Limited - NIL (Previous Year - NIL)

Maximum Amount Due at any time during the year Rs. 106,796,775 (Previous Year Rs. 102,532,188)

b) Lapiz Inc USA - Rs. 40,124,343 (Previous Year Rs. 59,976,738)

Maximum Amount Due at any time during the year Rs.74,895,131 (Previous Year Rs. 64,323,481)

12. Cash and bank balance include Rs. 21,59,998 (Previous Year - Rs. 52,11,600) being remittance in transit.

13. Previous Years figures have been regrouped and recast wherever necessary. Figures in brackets represent previous years figures.

 
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