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Notes to Accounts of Zuari Global Ltd.

Mar 31, 2016

b. Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of '' 10/- Share. Each share holder of equity shares is entitled to one vote per share.

The Company declares and pay dividends in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

For the year ended 31st March 2016, the amount of per share dividend recognized as distribution to equity share holders was Rs.1/- (31st March 2015:: Rs.1/-), subject to approval of shareholders.

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

As per records of the Company, including its register of shareholders/member and other declarations received from shareholders regarding beneficial interest, the above holding represents both legal and beneficial ownership of shares.

** During the previous year ended 31 March 2015, Adventz Investments and Holdings Limited had been merged with Adventz Finance Private Limited vide court order dated 2nd June 2014 and accordingly all shares held by Adventz Investments and Holdings Limited are now vested with Adventz Finance Private Limited.

* Refer note 40

(i) The loan is secured by the first exclusive charge on specific immovable property (shown as inventories) of the Company.

(ii) The Company has undertaken that during the term of the loan, it shall continue to hold and it shall not enter into a transaction to encumber any of the following equity shares which are currently directly or indirectly held by it:

a) 100% equity shares in the total equity share capital of Zuari Investment Limited (ZIL).

b) 30% equity shares in the total equity share capital of Zuari Agro Chemicals Limited.

c) 12% equity shares in the total equity share capital of Chambal Fertilizers and Chemicals Limited.

d) 25% equity shares in the total equity share capital of Gobind Sugar Mills Ltd.

(iii) Promoter group shall continue to have management control of the Company and ZIL (Subsidiary company) and hold majority ownership (at least 51% of the total equity share capital without any encumbrance) in the Company including the ability to appoint majority Directors of the Board of the Company and ZIL.

(a) (i) Pursuant to the Composite Scheme of Arrangement and Amalgamation among iKisan Limited, Kakinada Fertilisers Limited (KFL), Nagarjuna Fertilisers and Chemicals Limited (NFCL) and Nagarjuna Oil Refinery Limited (NORL), the Company had got one fully paid up equity share of Nagarjuna Oil Refinery Limited of Rs.1/- each for every one equity share of Rs.10/- held in NFCL and eleven equity shares in KFL of Rs.1/- each for every ten equity shares of Rs.10/- held in NFCL. The name of KFL has subsequent to merger on rights issue changed to NFCL. The cost of shares held in Nagarjuna Fertilizers and Chemicals Limited had been allocated in the ratio of 76.65% and 23.35% to the shares of Nagarjuna Oil Refinery Limited and Nagarjuna Fertilizers and Chemicals Limited. (formerly known as Kakinada Fertilizers Limited)

(ii) The Company''s investment in Nagarjuna Oil Refinery Limited aggregated to Rs.6,944.09 Lacs (31st March 2015:: Rs.6,944.09 Lacs) (based on cost allocation as above in (i) and market value of this is Rs.1,085.37 Lacs (31st

March 2015:: Rs.1,205.64 Lacs). Hence, there is a diminution in the value of investment by Rs.5,858.72 Lacs (31st March 2015:: Rs.5,738.45 Lacs)

(iii) The shares of Nagarjuna Fertilizers and Chemicals Limited alloted to the Company, are not yet listed on stock exchange, pending receipt of permission from Securities and Exchange Board of India.

(b) The Company has investment of Rs.5,103.34 Lacs in the equity shares and Rs.1,000 Lacs in redeemable convertible non-cumulative preference shares of one of its subsidiary company, Indian Furniture Products Limited. The Company has assured to provide continuous financial support. As per the latest audited financial statements of this subsidiary, it has accumulated losses which have resulted in erosion of substantial portion of its net worth.

(c) During the year, one of the subsidiary company, Globex Limited was put into liquidation vide resolution passed in the meeting of the parent shareholder company''s representatives held on 30th October 2015. The Company has received entire amount of Rs.13.40 Lacs towards refund of equity.

(d) The Company had entered into an agreement for sale of equity shares of Synthesis Energy System Inc aggregating to Rs.2,235.12 Lacs to one of its subsidiary company, Simon India Limited (SIL) at a price to be determined, which shall not be lower than the book value. During the current year, the Company has signed termination of the earlier agreement with SIL hence the Rs.1500 Lacs received as advance against these shares was refunded back to SIL.

(a) The Company has entered into Memorandum of understanding with Zuari Agro Chemicals Limited (ZACL) for sale of 3,22,67,741 equity shares of Nagarjuna Fertilizers and Chemicals Limited (NFCL), for a consideration that shall not be less than the market value of the shares as and when the share of NFCL are listed on the stock Exchange or book value. Pending listing of the shares of NFCL on the stock Exchanges, ZACL has paid an advance of Rs.11,920.00 Lacs to the Company, towards purchase of shares, which shall be adjusted thereafter from the total consideration amount at the time of the Sale / Transfer.

c. The Company has given a letter of Comfort to Ratnakar Bank Limited for the purpose of facilitating the loans of Rs.2,000.00 Lacs (31st March 2015:: Rs.2,000 Lacs) taken by Gobind Sugar Mills Limited.

d. The Company has given as collateral the specific land (appearing under inventories) by way of first and paramount charge in favour of a bank for the credit facility availed by one of its subsidiary.

1. Segmental Information Primary Segment

The Company has disclosed business segment as primary segment. The segments have been identified and reported taking into account the nature of products and services, the differing risks and returns, the organization structure and the internal reporting system. The identified reportable segments for the year under review are Fertilizers and land development. Fertilizer segment includes trading of fertilizers and pesticides. Land development segment includes acquiring lands with the objective of granting rights to other parties to develop the land under joint development agreement.

Secondary Segment - Geographical Segment.

The Company operates in India and therefore caters to the needs of the domestic market. Therefore, there are no reportable geographical segments.

Notes :

1. Zuari Investment Limited has undertaken that for the term loan of the Company of Rs.8,000 Lacs obtained by the Company from Rabo India Finance Ltd., it shall continue to hold 25% equity shares in the total equity share capital of Gobind Sugar Mills Ltd during the term of the loan.

2. Zuari Management Services Limited has undertaken that for the term loan of the Company of '' 8,000 Lacs obtained by the Company from Rabo India Finance Ltd., it shall continue to hold 10% equity shares in the total equity share capital of Zuari Agro Chemicals Limited during the term of the loan.

3. The Company has given a letter of Comfort to Ratnakar Bank Limited for the purpose of facilitating the loans of Rs.2,000.00 Lacs (31st March 2015 :: Rs. 2,000 Lacs) taken by Gobind Sugar Mills Limited.

4. The Company has given as collateral the specific land (appearing under inventories) by way of first and paramount charge in favour of a bank for the credit facility availed by Zuari infra world India Limited aggregating to Rs.17,677 Lacs

* The name of the company "Zuari Seeds Limited” has been changed to "Zuari Agri Sciences Limited” w.e.f.11th September, 2014.

** The name of the company "Zuari Maroc Phosphates Limited” has been changed to "Zuari Maroc Phosphates Private Limited” w.e.f.30th March, 2015.

*** The name of the company "Zuari Indian Oil tanking Limited” has been changed to "Zuari Indian Oil tanking Private Limited” w.e.f.15th April, 2015.

5. Employee benefits:

(A) Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet.

Statement of Profit and Loss

Net employee benefit expense (recognized in Employee Cost) for the year ended 31st March, 2016

B. Provident Fund

The Company has set up Provident Fund Trust, which was managed by the Company as per the Guideline Note on implementing AS-15, Employee Benefits (revised 2005) issued by the Accounting Standard Board (ASB), provident funds set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as defined benefit plan. With the transfer of Fertilizer undertaking to Zuari Agro Chemicals Limited, on demerger with effect from 1st July, 2011, the Trust is being managed by Zuari Agro Chemicals Limited and there is surplus in the fund balance in the provident fund trust maintained by the said company.

6. a). The Company has obtained office premises, apartments and warehouses on operating leases for the period ranging from 0-2 years. In all the cases, the agreements are further renewable at the option of the Company. There is escalation clause in the respective lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the statement of profit and loss for the year are Rs.3.12 Lacs (Previous year Rs.3.11Lacs).

b). The Company has given buildings on operating lease for the period of three years. In all the cases, the agreements are further renewable at the option of the Company. All these leases are cancellable in nature. There is no escalation clause in the respective lease agreements. The total lease income received in respect of such leases recognized in the statement of profit and loss Rs.31.44 Lacs (Previous year Rs.29.41 Lacs).

7. Under instructions from the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 8,051(previous year 8,051) Rights'' Equity Shares entitlements have been kept in abeyance pursuant to Section 126 of the Companies Act, 2013.

8. Disclosure required under Section 186 (4) of the Companies Act 2013

9. Income Tax Appellate Tribunal has, during the current year issued favourable decisions for certain past years but issue related to Section 14A of the Income Tax Act, 1961 has been set-aside and assessing officer has been asked to do fresh adjudication. The Company is carrying the same amount of income tax provision (already deposited in an earlier year) including interest thereon, provided in an earlier year for those years. The Company is of the view that the amount of provision so made is adequate. Also, appeal effect order for the assessment year 2009-10, is not yet received from the department. Pending receipt of such order, interest on income tax refund has not been recognized as the amount is presently not reasonably determinable.

10. Previous year’s figures have been regrouped/reclassified, where necessary, to confirm to this year’s classification.


Mar 31, 2015

1. Corporate Information

The Company is a public Company domiciled in India. The Company is in the business of trading of pesticides and complex fertilisers. The Company caters to the demand of the farmers all over the country. During the previous year, the Company has acquired lands with the objective of granting rights to other parties to develop the land under joint development agreement.

2. Basis for preparation

The financial statements of the Company have been prepared in accordance with the generally accepted accounting principles in India (Indian GAAP).The Company has prepared these financial statements to comply in all material respects with the accounting standards notified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rule 2014. The financial statements have been prepared on an accrual basis and under the historical cost convention except for derivative financial instruments which have been measured at fair value. The accounting policies have been consistently applied by the Company and are consistent with those used in previous year, except for the change in accounting policy explained below.

3.Terms/Rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10/- Share. Each share holder of equity shares is entitled to one vote per share.

The Company declares and pay dividends in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

For the year ended 31st March, 2015, the amount of per share dividend recognised as distribution to equity shareholders was Rs. 1/- (31st March, 2014:: Rs. 1/-), subject to approval of shareholders.

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

(i) The loan is secured by the first exclusive charge on specific immovable property (shown as inventories) of the Company.

(ii) The Company has undertaken that during the term of the loan, it shall continue to hold and it shall not enter into a transaction to encumber any of the following equity shares which are currently directly or indirectly held by it:

(a) 10% equity shares in the total equity share capital of Gulbarga Cement Limited unless diluted by an increase in shareholding by other entities / shareholders. During the year, the Company has sold its share held in Gulbarga Cement Limited to an affiliate of Zuari Cement Limited and is in the process of discussion with Rabo India Finance Limited to prepay part of the loan out of the proceeds.

(b) 100% equity shares in the total equity share capital of Zuari Investments Limited (ZIL).

(c) 30% equity shares in the total equity share capital of Zuari Agro Chemicals Limited (ZACL).

(d) 12% equity shares in the total equity share capital of Chambal Fertilisers and Chemicals Limited (CFCL).

(e) 25% equity shares in the total equity share capital of Gobind Sugar Mills Ltd. (GSML).

(iii) Promoter group shall continue to have management control of the Company and ZIL (Subsidiary Company) and hold majority ownership (atleast 51% of the total equity share capital without any encumbrance) in the Company including the ability to appoint majority Directors of the Board of the Company and ZIL.

(a) (i) Pursuant to the Composite Scheme of Arrangement and Amalgamation among iKisan Limited, Kakinada Fertilisers

Limited (KFL), Nagarjuna Fertilisers and Chemicals Limited (NFCL) and Nagarjuna Oil Refinery Limited (NORL), the Company had got one fully paid up equity share of Nagarjuna Oil Refinery Limited of Rs. 1/- each for every one equity share of Rs. 10/- held in NFCL and eleven equity shares in KFL of Rs. 1/- each for every ten equity shares of Rs. 10/- held

in NFCL. The name of KFL, has subsequent to merger on rights issue, changed to NFCL. The cost of shares held in Nagarjuna Fertilisers and Chemicals Limited had been allocated in the ratio of 76.65% and 23.35% to the shares of Nagarjuna Oil Refinery Limited and Nagarjuna Fertilisers and Chemicals Limited (formerly known as Kakinada Fertilisers Limited).

(ii) The Company's investment in Nagarjuna Oil Refinery Limited aggregated to Rs. 6,944.09 lacs (31st March, 2014:: Rs. 6,944.09 lacs) (based on cost allocation as above in (i)) and market value of this is Rs. 1,205.64 lacs (31st March, 2014:: Rs. 1,056.04 lacs) . Hence, there is a diminution in the value of investment by Rs. 5,738.45 lacs (31st March, 2014:: Rs. 5,888.05 lacs)

(iii) The shares of Nagarjuna Fertilisers and Chemicals Limited alloted to the Company, are not yet listed on Stock Exchange, pending receipt of persmission from Securities and Exchange Board of India.

(b) The Company has invested a sum of Rs. 5,103.34 lacs (31st March, 2014:: Rs. 4,650.01 lacs) in the equity shares of one of its subsidiary Company, Indian Furniture Products Limited. The Company has assured to provide continuous financial support. As per the latest audited financial statements of this subsidiary, it has accumulated losses which have resulted in erosion of substantial portion of its net worth.

This being long term investment, management is of the view that the diminution in the value of this investment is temporary in nature and hence no provision is required to be made thereagainst.

(c) (i) During the previous year ended 31st March, 2014, the Company has converted intercorporate deposit of Rs. 650.00 lacs

into 65 lac equity shares of Rs. 10 each given to its subsidiary Zuari Infraworld India Limited (formerly known as Adventz Infraworld India Limited).

(ii) During the previous year ended 31st March, 2014, the Company had converted intercorporate deposit of Rs. 1,000.00 lacs into 100 lacs equity shares of Rs. 10 each given to its subsidiary Indian Furniture Products Limited.

(iii) The Company has on December 18, 2014 terminated the Shareholders agreement with Zuari Cements Limited and has received Rs. 1641.27 lacs towards sale of equity shares held in Gulbarga Cement Limited from an affiliate of Zuari Cement Limited at book value.

(d) Pursuant to the Scheme of Amalgamation between Indian Furniture Products Limited (IFPL) and Style Spa Furniture Limited (SSFL), the Company has got fifteen fully paid equity shares of IFPL of Rs. 10/- each for every fourteen equity shares of Rs. 10/- held in SSFL.

(e) The Company has invested a sum of Rs. 275 lacs in the equity shares of Zuari Financial Services Limited acquired from Zuari Investment Limited ( a wholly owned subsidiary of the Company). Consequently, ZFSL become wholly owned subsidiary of the Company. Further, on February 11, 2015, ZFSL has alloted 1240000 equity shares of Rs. 10/- each at a consideration of Rs. 11/- per share through Right issues.

(a) The Company has entered into Memorandum of understanding with Zuari Agro Chemicals Limited (ZACL) for sale of 32267741 equity shares of Nagarjuna Fertilizers and Chemicals Limited (NFCL) , for a consideration that shall not be less than the market value of the shares as and when the share of NFCL are listed on the stock Exchange or book value. Pending listing of the shares of NFCL on the stock Exchanges, ZACL has paid an advance of Rs. 119.20 lacs to the Company, towards purchase of shares, which shall be adjusted thereafter from the total consideration amount at the time of the Sale / Transfer.

(b) The Company had entered into an agreement for sale of equity shares of Synthesis Energy System Inc. aggregating to Rs. 2,235.12 lacs to one of its subsidiary Company, Simon India Limited (SIL) at a price to be determined, which shall not be less than the book value. The Company has received an amount of Rs. 1,500 lacs as advance from SIL against sale of these shares.

4. Contingent liabilities

a) Contingent liabilities not provided for:

Rs. in lacs

Year Ended Year Ended Particulars 31st March, 31st March, 2015 2014

Demand Notices received from Income Tax Authorities*

i. Demand in respect of 254.47 - Assessment Year 2007-2008 for which an appeal is pending with CIT (Appeals)

ii. In respect of Assessment 1,718.77 - year 2011-12, certain adjustments have been proposed to be made to the transaction value by the tax authorities based on arm's length price of international transaction with associated enterprise and other adjustments. The Company is yet to receive final order. The amount of tax is excluding interest and penalty. The Company has filed application before Dispute Redressal Panel (DRP), which is pending.

iii. Demand in respect of 1,263.50 - Assessment year 2012-13 for which an appeal is pending with CIT (Appeals)

iv. Demand in respect of 565.78 565.78 Wealth Tax for Assessment Years 2006-07 to 2010-11 for which the Company has filed appeals with Commissioner of Wealth Tax (Appeals). The Company has deposited Rs. 282.89 lacs under protest.

* Based on discussions with the solicitors/ favorable decisions in similar cases, the management believes that the Company had a good chance of success in above mentioned cases and hence, no provision there against was considered necessary.

5. Segmental Information

Primary Segment

The Company has disclosed business segment as primary segment. The segments have been identified and reported taking into account the nature of products and services, the differing risks and returns, the organisation structure and the internal reporting system. The identified reportable segments for the year under review are Fertilisers and land development. Fertiliser segment includes trading of fertilisers and pesticides. Land development segment includes acquiring lands with the objective of granting rights to other parties to develop the land under joint development agreement.

Secondary Segment - Geographical Segment.

The Company operates in India and therefore caters to the needs of the domestic market. Therefore, there are no reportable geographical segments.

6. Related Party disclosures under Accounting Standard - 18

a) The list of related parties as identified by the management are as under:

i) Subsidiaries of the Company:

1. Indian Furniture Products Limited

2. Soundaryaa IFPL Interiors Limited (subsidiary of Indian Furniture Products Limited w.e.f 04/12/2014)

3. Simon India Limited

4. Zuari Management Services Limited

5. Zuari Infraworld India Limited

6. Zuari Infra Middle East Limited (subsidiary of Zuari Infraworld India Limited w.e.f 10/09/2014)

7. Globex Limited

8. Zuari Financial Services Limited (w.e.f 15/01/2015)(earlier subsidiary of Zuari Investments Limited)

9. Zuari Investments Limited

10. Zuari Insurance Brokers Limited - Subsidiary of Zuari Investments Limited

11. Zuari Commodity Trading Limited - Subsidiary of Zuari Investments Limited

12. Gobind Sugar Mills Limited (subsidiary of Zuari Investments Limited w.e.f 25/08/2014)

ii) Joint Ventures of the Company:

1. Zuari Indian Oiltanking Limited

2. Gulbarga Cement Limited (upto 12/01/2015)

3. MCA Phosphates Pte. Limited (upto 27/03/2014 and thereafter as associate)

iii) Associates of the Company*:

1. Zuari Agro Chemicals Limited

2. Zuari Agri Science Limited (formerly known as Zuari Seeds Limited) - Subsidiary of Zuari Agro Chemicals Limited

3. Zuari Fertlisers and Chemicals Limited - Subsidiary of Zuari Agro Chemicals Limited

4. Zuari Rotem Speciality Fertilizer Limited - Joint Venture of Zuari Agro Chemicals Limited

5. Zuari Maroc Phosphates Private Limited (formerly known as Zuari Maroc Phosphates Limited) - Joint Venture of Zuari Agro Chemicals Limited

6. Paradeep Phosphates Limited- Subsidiary of Zuari Maroc Phosphates Private Limited (formerly known as Zuari Maroc Phosphates Limited)

7. Gobind Sugar Mills Limited - Associate of Zuari Investments Limited (upto 24/08/2014 and thereafter as subsidiary)

8. New Eros Tradecom Limited-Associate of Zuari Investments Limited (subsidiary of Gobind Sugar Mills Limited upto 31/08/2014)

9. MCA Phosphates Pte. Limited (Joint Venture of Zuari Agro Chemicals Limited)

* The Company and its subsidiary Company hold more than 20% of the voting power of bodies corporate. The Company has been legally advised that it does not have any "significant influence" in the said bodies corporate as defined in Accounting Standard 18 "Related Party Disclosures" and accordingly has not considered the above investees as related party under AS-18 for the above disclosure.

iv) Enterprises having significant influence

1. Globalware Trading and Holdings Limited

v) Key Management Personnel of the Company:

1. Mrs. Jyotsna Poddar, Executive Director

2. Mr. H. S. Bawa, Executive Vice Chairman (upto 31/08/2013)

vi) Relatives of Key Management Personnel of the Company:

1. Mr. S. K. Poddar (Chairman), Husband of Mrs. Jyotsna Poddar.

2. Mr. Akshay Poddar, Son of Mrs. Jyotsna Poddar

3. Mrs. Veena Bawa, Wife of Mr. H. S. Bawa (upto 31/08/2013)

4. Mrs. Seema Behl, Daughter of Mr. H. S. Bawa (upto 31/08/2013)

5. Mrs. Meenakshi Bawa, Daughter of Mr. H. S. Bawa (upto 31/08/2013)

7. Employee benefits:

(A) Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance Company in the form of a qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognized in the Balance Sheet.

8. a) The Company has obtained office premises, apartments and warehouses on operating leases for the period ranging from 0-2 years. In all the cases, the agreements are further renewable at the option of the Company. There is escalation clause in the respective lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the Statement of Profit & Loss for the year are Rs. 3.11 lacs(Previous year Rs. 4.88 lacs).

b) The Company has given buildings on operating lease for the period of three years. In all the cases, the agreements are further renewable at the option of the Company. All these leases are cancellable in nature. There is no escalation clause in the respective lease agreements. The total lease income received in respect of such leases recognized in the Statement of Profit & Loss for the year is Rs. 29.41 lacs (Previous year Rs. 29.41 lacs).

9. Under Section 133A of the Income Tax Act, 1961 the Income Tax department carried out a survey at the Company's premises in February, 2014. Pursuant to the discussions during the survey, the Company agreed to pay additional amount towards income tax demands, which has been paid during the last quarter of that year. The Company has subsequently filed an application with the Commissioner of Income Tax (Appeals) and has obtained a partial relief vide order dated April 22, 2014 issued by the Commissioner of Income Tax (Appeals). The short provision for income tax of Rs. 2,799.45 lacs and interest of Rs. 1,116.68 lacs in respect of earlier years, consequent to the additional tax claim, had been appropriately accounted for under exceptional items by the Company in the previous year.

10. Under instructions from the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 8,051(previous year 8,051) Rights' Equity Shares entitlements have been kept in abeyance pursuant to Section 126 of the Companies Act, 2013.

11. In light of Section 135 of Companies Act, 2013, the Company has incurred Rs. Nil during the current year on Corporate Social Responsibility (CSR) against gross amount required to be spent Rs. 81.09 lacs.

12. Previous year's figures have been regrouped / reclassified, where necessary, to confirm to this year's classification.


Mar 31, 2014

1. During the year, the Company has foated Voluntary Retrement Scheme for the employees working in the Administratve Ofce at Goa. Total 6 employees have opted for deferred payment under Voluntary Retrement Scheme. The total outgo will be Rs. 100.11 lacs, which has been fully charged as exceptonal item in the Statement of Proft and Loss as per accountng policy followed.

2. Under instructons from the Special Court (Trial of Ofences relatng to Transactons in Securites) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 8,051(previous year 8,051) Rights'' Equity Shares enttlements have been kept in abeyance pursuant to Secton 206A of the Companies Act, 1956

3. Previous year''s fgures have been regrouped / reclassifed, where necessary, to confrm to this year''s classifcaton.


Mar 31, 2013

1. Corporate Informaton

The Company is a public Company domiciled in India and incorporated under the provisions of the Companies Act 1956. The Company is in the business of trading of pestcides. Last year upto 30th June, 2011 i.e. before demerger of the fertliser undertaking, the Company was in the business of manufacture of chemical fertlisers and also trading of complex fertlisers, water solubles and seeds. The Company caters to the demand of the Farmers all over the country.

2. Basis for preparaton

The fnancial statements of the Company have been prepared in accordance with generally accepted accountng principles in India (Indian GAAP). The Company has prepared these fnancial statements to comply in all material respects with the accountng standards notfed under the Companies (Accountng Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The fnancial statements have been prepared under on an accrual basis and under the historical cost conventon. The accountng policies have been consistently applied by the Company and are consistent with those used in previous year.

3. Demerger

a) Pursuant to the Scheme of Arrangement and Demerger (''the Scheme'') between Zuari Global Limited formerly known as Zuari Industries Limited and Zuari Agro Chemicals Limited (ZACL) formerly known as Zuari Holdings Limited approved by the Hon''ble High Court of Bombay at Goa on 2nd March 2012, all the Assets, Liabilites pertaining to Fertliser Undertaking as on 1st July, 2011 had been transferred to ZACL at their book values and accordingly Rs.68348.90 lacs being the surplus of Assets over the Liabilites of the Fertliser undertaking so Demerged, has been reduced from Capital redempton Reserve, Capital Reserve, General Reserve and Statement of Proft and Loss in terms of the Order of the Hon''ble High Court of Bombay at Goa. The said order was fled with Registrar of Companies on 21st March,2012.

b) The summary of the assets and liabilites transferred to ZACL as on July 1, 2011 is as below:

c) Pursuant to the Scheme, ZACL has during the current year issued 294,40,604 Equity Shares of Rs. 10/– each aggregatng to Rs. 2944.06 lacs to the existng shareholders of the Company, in the rato of 1 fully paid up Equity Share ofRs. 10/– each of ZACL for each share ofRs. 10/– each held in the Company.

d) The results of the Company for the previous year ended 31st March, 2012 were afer giving efect to the Scheme, whereby the Fertliser Undertaking has been demerged to ZACL with appointed date of 1st July, 2011 and accordingly its previous year''s fgures are not comparable with current year.

e) As per the Scheme, during the period between the Appointed date and the Efectve date, the Company deemed to have carried on the Fertliser Undertaking in "trust" on behalf of ZACL. Further all profts or incomes earned and losses and expenses incurred for Fertliser Undertaking, were for all purpose, be deemed to be profts or income or expenditure or losses of ZACL.

f) The ttle deeds for immovable propertes, licenses, agreements, loan documents etc. of the Company are in the process of being transfered in the name of ZACL.

4. Segmental Informaton

- Primary Segment

The Company is engaged in the trading of pestcides which, in the context of Accountng Standard 17 (Segmental Informaton) notfed by Companies (Accountng Standard) Rules, 2006 (as amended), is considered as the only business segment. Accordingly, no separate segmental informaton has been provided herein.

- Secondary Segment - Geographical Segment.

The Company operates in India and therefore caters to the needs of the domestc market. Therefore, there are no reportable geographical segments.

5. Related Party disclosures under Accountng Standard -18

a) The list of related partes as identfed by the management are as under:

i) Subsidiaries of the Company:

(1) Indian Furniture Products Limited

(2) Simon India Limited

(3) Zuari Management Services Limited

(4) Adventz Infraworld India Limited

(5) Globex Limited

(6) Style Spa Furniture Limited (w.e.f. 27/09/2011)

(7) Zuari Investments Limited

(8) Gulbarga Cement Limited (up to 08/09/2011 and thereafer as joint venture)

(9) Zuari Agro Chemicals Limited (formerly known as Zuari Holdings Limited) (up to 30/06/2011 and thereafer as an Associate)

(10) Zuari Fertlisers and Chemicals Limited (up to 30/06/2011 and thereafer as an Associate)

(11) Zuari Insurance Brokers Limited - Subsidiary of Zuari Investments Limited

(12) Zuari Commodity Trading Limited - Subsidiary of Zuari Investments Limited

(13) Zuari Financial Services Limited - Subsidiary of Zuari Investments Limited

(14) Zuari Seeds Limited (up to 30/06/2011 and thereafer as an Associate)

ii) Joint Ventures of the Company:

(1) Zuari Indian Oiltanking Limited

(2) Gulbarga Cement Limited (w.e.f. 09/09/2011)

(3) MCA Phosphates Pte. Limited (w.e.f. 22/12/2011)

(4) Zuari Maroc Phosphates Limited (up to 30/06/2011 and thereafer as Associate)

(5) Paradeep Phosphates Limited - Subsidiary of Zuari Maroc Phosphates Limited (up to 30/06/2011 and thereafer as Associate)

(6) Zuari Rotem Speciality Fertliser Limited (up to 30/06/2011 and thereafer as Associate)

iii) Associates of the Company*:

(1) Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited) (w.e.f. 01/07/2011)

(2) Zuari Seeds limited - Subsidiary of Zuari Agro Chemicals Limited

(3) Zuari Fertlisers and Chemicals Limited - Subsidiary of Zuari Agro Chemicals Limited

(4) Zuari Rotem Speciality Fertliser Limited -Joint Venture of Zuari Agro Chemicals Limited

(5) Zuari Maroc Phosphates Limited-Joint Venture of Zuari Agro Chemicals Limited

(6) Paradeep Phosphates Limited- Subsidiary of Joint Venture of Zuari Agro Chemicals Limited

(7) Gobind Sugar Mills Ltd. - Associate of Zuari Investments Limited (w.e.f. 21/08/2012)

(8) New Eros Tradecom Ltd.-Subsidiary of Gobind Sugar Mills Ltd.

* The Company and its subsidiary company hold more than 20% of the votng power of bodies corporate. The Company has been legally advised that it does not have any "signifcant infuence" in the said bodies corporate as defned in Accountng Standard 18 "Related Party Disclosures" and accordingly has not considered the above investees as related party under AS-18 for the above disclosure.

iv) Key Management Personnel of the Company:

1) Mr. H.S. Bawa, Executve Vice Chairman

2) Mrs. Jyotsna Poddar, Executve Director (w.e.f. 01/04/2012)

3) Mr. N. Suresh Krishnan, Managing Director (up to 31/03/2012)

v) Relatves of Key Management Personnel of the Company:

1) Mrs. Veena Bawa, Wife of Mr. H.S. Bawa

2) Mrs. Seema Behl, Daughter of Mr. H.S. Bawa

3) Mrs. Meenakshi Bawa, Daughter of Mr. H.S. Bawa

4) Mr. S. K. Poddar (Chairman), Husband of Mrs. Jyotsna Poddar.

6. Employee benefts:

(A) Gratuity

The Company has a defned beneft gratuity plan. Every employee who has completed fve years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following tables summarize the components of net beneft expense recognized in the statement of proft and loss and the funded status and amounts recognized in the balance sheet.

Statement of Proft and Loss

Net employee beneft expense (recognized in Employee Cost) for the year ended 31st March, 2013

7. a) The Company has obtained ofce premises, apartments and warehouses on operatng leases for the period ranging from 0-2 years. In all the cases, the agreements are further renewable at the opton of the Company. There is escalaton clause in the respectve lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the statement of proft and loss for the year are Rs.1.67lacs (Previous year Rs.101.17 lacs).

b) The Company has given buildings on operatng lease for the period of three years. In all the cases, the agreements are further renewable atthe opton of the Company. All these leases are cancellable in nature. There is no escalaton clause in the respectve lease agreements. The total lease income received in respect of such leases recognized in the statement of Proft and Loss for the year is Rs. 29.41 lacs (Previous year Rs. Nil).

8. Under instructons from the Special Court (Trial of Ofences relatng to Transactons in Securites) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 8,051 (previous year 8,051) Rights'' Equity Shares enttlements have been kept in abeyance pursuant to Secton 206Aof the Companies Act, 1956

9. Pending receipt of appeal efect orders for the assessment years 2003-04 to 2005-06, where appeal has been decided partly in favour of the Company by the Income Tax Appellate Tribunal, Interest on income tax refund has not been recognized thereof as the amount is presently not reasonably determinable. Interest income on this refund will be recognized in the year the appeal efect order is received from Income Tax Department

10. Previous year''s fgures have been regrouped / reclassifed, where necessary, to confrm to this year''s classifcaton.


Mar 31, 2012

1. Corporate Information

The Company is a public Company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The Company is the manufacturer of chemical fertilizers. The Company is also into trading business of complex and water soluble fertilisers and seeds. The Company caters to the demand of the Farmers all over the country, through its "Jaikisaan" brand of Fertilisers.

2. Basis for preparation

The financial statements of the Company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statement to comply in all material respects with the Notified Accounting Standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in previous year except for the change in accounting policy explained below.

a. Terms/Rights Attached to equity Shares

The Company has only one class of equity shares having a par value of Rs. 10/- each. Each share holder of equity shares is entitled to one vote per share. The Company declares and pay dividends in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting.

During the year 31st March 2012, the amount of per share dividend recognised for distribution to equity share holders was Rs. 2/ -, subject to approval of shareholders (31st March 2011:: Rs. 4.50/-)

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

# OSI Limited had merged with Globalware Trading and Holdings Limited with effect from September 2011

As per records of the Company including its register of share holders/members and other declarations received from shareholders regarding beneficial interest, the above share holding represents both legal and beneficial ownership of shares.

The cash credit and buyers credit are secured by the first charge by way of hypothecation on the current assets, both present and future, wherever situated pertaining to the Company and the Company's present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets.

(a) Pursuant to the Composite Scheme of Arrangement and Amalgamation amoung iKisan Limited, Kakinada Fertilisers Limited (KFL), Nagarjuna Fertilisers and Chemicals Limited (NFCL) and Nagarjuna Oil Refinery Limited (NORL), the Company has got one fully paid up equity share of Nagarjuna Oil Refinary Limited of Re.1/- each for every one equity share of Rs. 10/- held in NFCL and eleven equity shares in KFL of Re.1/- each for every ten equity shares of Re.10/- held in NFCL. The name of KFL, subsequent to Merger, has changed to NFCL. The cost of shares held in Nagarjuna Fertilisers and Chemicals Limited has been allocated in the ratio of 76.65% and 23.35% to the shares of Nagarjuna Oil Refinery Limited and Nagarjuna Fertilisers and Chemicals Limited(formarly known as Kakinada Fertilisers Limited).

(b) (i) The Company's investment in Nagarjuna Oil Refinery Limited aggregated to Rs. 6944.09 lacs (based on cost allocation as above in (a)) and market value of this investment is Rs. 1,862.72 lacs. Hence, there is a diminution in the value of investment by Rs. 5,081.37 lacs.

(ii) The Company has an investment of Rs. 258.90 lacs in the equity shares of Lionel India Limited (LIL). As per the latest audited financial statements of LIL, it has accumulated losses which have resulted in erosion of a major portion of its net worth. LIL is continuously incurring losses.

*(iii) The Company has investment of Rs. 453.34 lacs in equity and preference share capital of its subsidiary "Style Spa Furniture Limited" (ceases to be associate of Zuari Industries Limited on 27th July, 2011). As per the latest audited financial statements, it has accumalated losses which have resulted in errosion of a substantial portion of its net worth.

(iv) The Company has an investment of Rs. 2,235.12 lacs in the equity shares of Sythesis Energy Systems Inc. and market value of this investment is Rs. 1671.11 lacs . Hence, there is a diminution in the value of this investment by Rs. 564.01 lacs .

These being long term investments, management is of the view that the diminution in the value of these investments is temporary in nature and hence no provision is required to be made thereagainst.

(c) The Company has sold the equity shares of Zuari Seeds Limited, Zuari Fertilisers and Chemicals Limited, Zuari Maroc Phosphates Limited and Zuari Rotem Speciality Fertilisers Limited to its then subsidiary, Zuari Holdings Limited, at cost in the month of May and June 2011.

The Company has till date recognised Rs. 634.08 lacs (Previous year Rs. Nil) as Minimum Alternate Tax (MAT) credit entitlement which represents that portion of the MAT Liability, the credit of which would be available based on the provision of Section 115 JAA of the Income tax Act, 1961. The management based on the future profitability projections and also profit earned during the year is confident that there would

(b) Interest accrued on employee's loan include amount due from officer of the Company Rs. 7.53 lacs (including Rs. 3.80 lacs from the Managing Director of the Company (31st March 2011:: Rs. 1.53 lacs), (31st March 2011 Rs. 5.67 lacs).

(a) Sale of finished and traded products include Government Subsidies. Subsidies include Rs. 118.72 lacs (31st March 2011:: Rs. 6,708.40 Lacs) in respect of earlier years, notified during the year

(b) Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard.

(c) Excise duty on sales amounting to Rs. 252.80 lacs (31st March, 2011:: Rs. 32.43 lacs) has been reduced from sales in statement of profit and loss and excise duty on increase / decrease in stock amounting to Rs. (8.44) lacs (31st March, 2011 Rs. 8.44 lacs) has been considered as (income)/expense in the financial statement.

3 Contingent liabilities not provided for :

Year ended Year ended Particulars 31st March, 2012 31st March, 2011 Rs.in lacs Rs.in lacs

A. Demand Notices received from Sales Tax authorities

i) Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 2005-06 to 2008-09. The Company has filed appeal before Joint Commissioner of Commercial Taxes (Appeals), Bangalore, against the same. (The Company had deposited Rs.21.28 - 42.56 lacs against the same which was appearing in the schedule of Loans & Advances) (Transfered to Zuari Holdings Limited in term of the Scheme of Arrangement and Demerger. Refer note no. 50)

B.Demand raised by Excise Authorities on Service Tax matters *

Demand notice from Service Tax Authorities towards Service Tax under Goods Transport Agency Services for the period 2006-07 to 2010-11. - 94.10

* Based on discussions with the solicitors/ favourable decisions in similar cases/ legal opinions taken by the Company, the management believes that the Company has a good chance of success in above mentioned cases and hence, no provision there against was considered necessary.

4. Aggregate amount of guarantees issued by the Banks to various government authorities and others are secured by a charge created by way of hypothecation Rs. Nil (Previous year Rs. 15,534.46 lacs)

* Managerial Remuneration is paid within the limits of Schedule XIII of the Companies Act, 1956. As the liabilities for gratuity and leave encashment are provided on an actuarial basis for the Company as a whole, the amounts pertaining to the directors are not included above.

5. Segmental Information

§ Primary Segment

The Company is engaged in the manufacture, sale and trading of fertiliser, seeds and pesticides which, in the context of Accounting Standard 17 (Segmental Information) notified by Companies (Accounting Standard) Rules, 2006 (as amended), is considered as the only business segment. Accordingly, no separate segmental information has been provided herein.

§ Secondary Segment - Geographical Segment.

The Company operates in India and therefore caters to the needs of the domestic market. Therefore, there are no reportable geographical segments.

6. Related Party disclosures under Accounting Standard - 18

a) The list of related parties as identified by the management are as under:

i) Subsidiaries of the Company:

(1) Indian Furniture Products Limited

(2) Zuari Seeds Limited (up to 30/06/2011 and thereafter as Associate)

(3) Simon India Limited

(4) Zuari Management Services Limited

(5) Adventz Infraworld India Limited

(6) Gulbarga Cement Limited (up to 08/09/2011 and thereafter as Joint Venture)

(7) Zuari Holdings Limited -(up to 30/06/2011 and thereafter as Associate)

(8) Zuari Fertlisers & Chemicals Limited (up to 30/06/2011 and thereafter as Associate)

(9) Globex Limited

(10) Styles Spa Furniture Limited (w.e.f 27/09/2011)

(11) Zuari Investments Limited

(12) Zuari Insurance Brokers Limited - Subsidiary of Zuari Investments Limited

(13) Zuari Commodity Trading Limited - Subsidiary of Zuari Investments Limited

(14) Zuari Financial Services Limited - Subsidiary of Zuari Investments Limited

ii) Joint Ventures of the Company:

(1) Zuari Indian Oiltanking Limited

(2) Zuari Maroc Phosphates Limited (up to 27/06/2011 and thereafter as Associate)

(3) Gulbarga Cement Limited (w.e.f 09/09/2011)

(4) Paradeep Phosphates Limited - Subsidiary of Zuari Maroc Phosphates Limited (up to 30/06/2011 and thereafter as Associate)

(5) Zuari Rotem Speciality Fertiliser Limited (up to 30/06/2011 and thereafter as Associate)

(6) MCA Phosphates Pte Limited (w.e.f 22/12/2011)

iii) Associates of the Company*:

(1) Style Spa Furniture Limited

(An associate of a Zuari Investments Limited up to 27/09/2011 and thereafter as Subsidiary)

(2) Zuari Holdings Limited (w.e.f 01/07/2011)

(3) Zuari Seeds Limited - Subsidiary of Zuari Holdings Limited (w.e.f. 01/07/2011)

(4) Zuari Fertlisers & Chemicals Limited - Subsidiary of Zuari Holdings Limited (w.e.f. 01/07/2011)

(5) Zuari Rotem Speciality Fertiliser Limited -Joint Venture of Zuari Holdings Limited (w.e.f. 01/07/2011)

(6) Zuari Maroc Phosphates Limited- Joint Venture of Zuari Holdings Limited (w.e.f. 01/07/2011)

(7) Paradeep Phosphates Limited- Subsidiary of Joint Venture of Zuari Holdings Limited (w.e.f. 01/07/2011)

* The Company holds more than 20% of the voting power of a body corporate. The Company has been legally advised that it does not have any "significant influence" in the said body corporate as defined in Accounting Standard 18 "Related Party Disclosures" and accordingly has not considered the above investee as related party under AS-18 for the above disclosure.

iv) Key Management Personnel of the Company:

(1) Mr. H. S. Bawa, Executive Vice Chairman

(2) Mr. Suresh Krishnan, Managing Director (upto 31-03-2012)

v) Relatives of Key Management Personnel of the Company:

(1) Mrs. Veena Bawa

(2) Mrs. Seema Behl

(3) Mrs. Meenakshi Bawa

7. In the Extraordinary General Meeting of the Company held on April 30, 2012 the shareholders have approved the change in the name of the Company from Zuari Industries Limited to Zuari Global Limited.

The Company has made an application to the Registrar of Companies, Goa (ROC) and fresh certificate of incorporation consequent to change of name is awaited from ROC.

8. Employee benefits :

(A) Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the Statement of Profit & Loss and the funded status and amounts recognized in the Balance Sheet.

B. Provident Fund

The Company has set up Provident Fund Trust, which was managed by the Company as per the Guideline Note on implementing AS- 15, Employee Benefits (revised 2005) issued by the Accounting Standard Board (ASB), provident funds set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as defined benefit plan. With the transfer of Fertliser undertaking to Zuari Holdings Limited, on demerger with effect from 1st July, 2011, the Trust is being managed by Zuari Holdings Limited and hence, no provision if any has been made in the books of the Company towards shortfall of provident fund liability on actuarial valuation, which is the opinion of the management would not be material.

9. Pending receipt of appeal effect orders for the assessment years 1998-99 to 2000-01 and 2002-03 to 2005-06, where appeal has been decided partly in favour of the Company by the Income Tax Appellate Tribunal, Interest on income tax refund has not been recognized thereof as the amount is presently not reasonably determinable. Interest income on this refund will be recognized in the year the appeal effect order is received from Income Tax Department.

10. The Company has obtained office premises, apartments and warehouses on operating leases for the period ranging from 2-6 years. In all the cases, the agreements are further renewable at the option of the Company. There is escalation clause in the respective lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the statement of profit and loss for the year are Rs. 101.17 lacs (Previous year Rs. 1037.48 lacs).

11. Department of Fertilizer, Government of India has issued an Office Memorandum dated July 11, 2011 where by subsidy rate applicable on closing stock of Finished Goods, Traded Goods and Raw Materials as on 31st March 2011 has been revised to subsidy rates applicable for the financial year 2010-11 as per the Nutrient Based subsidy policy. Accordingly the Company has adjusted its subsidy income for the current year by Rs. 4787.88 lacs, to give impact of above mopping up adjustment.

12. Under instructions from the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 10,564 (previous year 10,564) Rights' Equity Shares entitlements have been kept in abeyance pursuant to Section 206A of the Companies Act, 1956

13. Demerger

a) Pursuant to the Scheme of Arrangement and Demerger ( 'the Scheme') between Zuari Industries Limited and Zuari Holdings Limited approved by the Hon'ble High Court of Bombay at Goa on 2nd March 2012, all the Assets, Liabilities pertaining to Fertiliser Undertaking as on 1st July, 2011 have been transferred to Zuari Holdings Limited (ZHL) at their book values and accordingly Rs. 68348.90 lacs being the surplus of Assets over the Liabilities of the Fertiliser undertaking so Demerged, has been reduced from Capital Redemption Reserve, Capital Reserve, General Reserve and Statement of Profit and Loss in terms of the Order of the Hon'ble High Court of Bombay at Goa. The said reserve be treated as free reserve and may be restricted and not utilized for declaration of dividend by the Company. The said Order has been filed with Registrar of Companies on 21st March 2012.

c) Pursuant to the Scheme, Zuari Holdings Limited has since issued 294,40,604 Equity Shares of Rs. 10/- each aggregating to Rs. 2944.06 lacs to the existing shareholders of the Company, in the ratio of 1 fully paid up Equity Share of Rs. 10/- each of Zuari Holdings Limited for each share of Rs. 10/- each held in the Company.

d) The results of the Company for the current year ended 31st March, 2012 are after giving effect to the Scheme, whereby the Fertiliser Undertaking have been Demerged to Zuari Holdings Limited with appointed date of 1st July, 2011 and accordingly its previous year's figures are not comparable with current year.

e) As per the Scheme, during the period between the Appointed date and the Effective date, the Company deemed to have carried on the Fertiliser Undertaking in "trust" on behalf of Zuari Holdings Limited. Further all profits or incomes earned and losses and expenses incurred for Fertiliser Undertaking, shall for all purpose, be deemed to be profits or income or expenditure or losses of Zuari Holdings Limited.

f) The title deeds for immovable properties, licenses, agreements, loan documents etc. of the Company are in the process of being transfer in the name of Zuari Holdings Limited.

14. Till the year ended 31 March 2011, the Company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this years' classification. Except accounting for dividend on investments in subsidiaries, the adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of balance sheet. Previous year's figures have been regrouped/reclassified wherever necessary to confirm to this year's presentation.


Mar 31, 2011

1. Nature of Operations

The Company is the manufacturer of chemical fertilizers and pesticides. The Company is also into trading business of complex fertilizers, seeds and pesticides.

2 Contingent liabilities not provided for :

Rs. in lacs

Year ended Year ended

Particulars 31st March, 2011 31st March, 2010

A. Demand Notices received from Sales Tax authorities *

i) Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 2005-06 to 2008-09. The Company has filed appeal before Joint Commissioner of Commercial 42.56 42.56 Taxes (Appeals), Bangalore, against the same. (The Company has deposited Rs. 21.28 lacs against the same which is appearing in the schedule of Loans & Advances).

ii) Demand notice from Maharashtra Sales Tax Authorities in respect of Sales tax Assessment for the year 2004-05. The Company has applied for – 130.61 cancellation of assessment order under the Bombay Sales Act 1959.

B. Demand raised by Excise Authorities on Service Tax matters *

Demand notice from Service Tax Authorities towards Service Tax under Goods Transport Agency Services for the period 2006-07 to 2009-10. 94.10 76.87 (The Company has deposited Rs. 10.00 lacs against the same which is appearing in the schedule of Loans & Advances).

* Based on discussions with the solicitors/ favourable decisions in similar cases/ legal opinions taken by the Company, the management believes that the Company has a good chance of success in above mentioned cases and hence, no provision thereagainst is considered necessary.

10. b) A sum of Rs. 1,241.55 lacs (previous year Rs. 896.76 lacs) on account of unamortized foreign exchange premium on outstanding forward exchange contracts is being carried forward to be charged to Profit and Loss Account of subsequent period.

3. In accordance with explanations below Para 10 of Notified Accounting Standard 9 – Revenue Recognition, excise duty on sales amounting to Rs. 32.43 lacs (Previous Year Rs. 17.63 lacs) has been reduced from sales in Profit & Loss Account and excise duty on variation of opening and closing stock of finished goods amounting to Rs. 8.45 lacs (Previous Year Nil) has been considered as expense in the financial statements.

4. The Board of Directors of the Company in its meeting held on April 14, 2011 have decided to withdraw the Scheme of Amalgamation of Gobind Sugar Mills Limited (GSM) with the Company, which was pending for sanction before Hon'ble High Court of Bombay at Goa. The withdrawal was in view of the change in the business / economic environment in relation to the Company's operation resulting from deregulation of the fertilizer sector and to focus on its core business.

5. Item 1 and 2 under head 'Secured Loans', Bank guarantees as included in Note No. 8 above, are secured by the first charge by way of hypothecation of the current assets, both present and future, wherever situated pertaining to the Company and the Company's present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets.

i. The loan to Indian Furniture Products Limited (IFPL) of Rs. 1,290.77 lacs. (Balance outstanding on 1st April, 2010 Rs. 430.26 lacs) has been repaid during the year.

ii. A loan of Rs.100.00 lacs (Balance outstanding on 31st March 2011 is Rs.44.44 lacs (Previous year Rs. 77.78 lacs) was given to IFPL on 22nd July, 2009 and it is repayable in 36 equal monthly installments w.e.f 1st August, 2009.

iii. The loan to IFPL of Rs 1,000.00 lacs renewed repayable on 3rd May 2011.

iv. The loan of Rs. 4,053.00 lacs to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) was given on 6th February 2009 .It is renewed on 6th August 2010 and is repayable at the end of 18 months. Maximum amount of loan outstanding during the year is Rs. 4,053.00 lacs.

v. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) of Rs. 420.00 lacs was given on 13th May 2009. It was renewed on 13th November, 2010 and it is repayable in 18 months.

vi. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) of Rs.25.00 lacs was given on 18th August, 2009. It was renewed on 18th February 2011 and it is repayable in 18 months.

vii. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) of Rs.10.00 lacs was given on 20th August, 2009 . It was renewed on 19th February 2011 and it is repayable in 18 months.

viii. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) of Rs.50.00 lacs was given on 10th September, 2009 .It was renewed on 10th March 2011 and it is repayable in 18 months.

ix. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited ) of Rs.115.00 lacs on 17th November, 2009 and it is repayable in 18 months.

x. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited ) of Rs.110.00 lacs on 27th November, 2009 and it is repayable in 18 months.

xi. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited ) of Rs.150.00 lacs on 9th February, 2010 and it is repayable in 18 months.

xii. The loan to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited ) of Rs.295.00 lacs on 31st March, 2010 and it is repayable in 18 months.

xiii. During the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2011 is Rs.100.00 lacs) is given to Adventz Infraworld India Limited on 18th May 2010 and it is repayable in 18 months.

xiv. During the year, a loan of Rs.400.00 lacs (Balance outstanding on 31st March, 2011 is Rs.400.00 lacs) is given to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) on 21st June 2010 and it is repayable in 18 months.

xv. During the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2011 is Rs.100.00 lacs) is given to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) on 23rd July 2010 and it is repayable in 18 months.

xvi. During the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2011 is Rs.100.00 lacs) is given to Adventz Infraworld India Limited on 7th October 2010 and it is repayable in 18 months.

xvii. During the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2011 is Rs.100.00 lacs) is given to Adventz Infraworld India Limited (formerly known as Zuari Developers Limited) on 28th October 2010 and it is repayable in 18 months.

xviii. During the year, a loan of Rs.150.00 lacs (Balance outstanding on 31st March, 2011 is Rs.150.00 lacs) is given to Adventz Infraworld India Limited on 23rd November 2010 and it is repayable in 18 months.

xix. During the year, a loan of Rs.150.00 lacs (Balance outstanding on 31st March, 2011 is Rs.150.00 lacs) is given to Adventz Infraworld India Limited on 10th December 2010 and it is repayable in 18 months.

xx. During the year, a loan of Rs.200.00 lacs (Balance outstanding on 31st March, 2011 is Rs.200.00 lacs) is given to Adventz Infraworld India Limited on 8th March 2011 and it is repayable in 18 months.

xxi. The loan to Gulbarga Cement Limited of Rs. 932.32 lacs paid on 1st January 2009 is renewed and is repayable on 30th September 2011.

xxii. The loan of Rs.25.00 lacs to Gulbarga Cement Limited paid on 22nd September, 2009 is renewed and it is repayable on 3rd November 2011.

xxiii. The loan of Rs.270.00 lacs to Gulbarga Cement Limited on 15th January, 2010 is renewed and it is repayable on 14th July 2011.

xxiv. The loan of Rs.200.00 lacs to Gulbarga Cement Limited on 31st March, 2010 is renewed and it is repayable on 30th September 2011.

xxv. During the year, a loan of Rs.100.00 lacs to Gulbarga Cement Limited on 23rd April 2010 is renewed and it is repayable on 22nd October 2011.

xxvi. During the year, a loan of Rs.860.00 lacs is given to Gulbarga Cement Limited on 26th July 2010 and it is repayable on 25th January 2012.

xxvii. During the year, a loan of Rs.700.00 lacs is given to Gulbarga Cement Limited on 16th September 2010 and it is repayable on 15th February 2012.

xxviii. During the year, a loan of Rs.300.00 lacs is given to Gulbarga Cement Limited on 20th September 2010 and it is repayable on 19th March 2012.

xxix. During the year, a loan of Rs.100.00 lacs is given to Gulbarga Cement Limited on 5th October 2010 and it is repayable on 4th April 2012

xxx. During the year, a loan of Rs.150.00 lacs given to Gulbarga Cement Limited on 20th October 2010 and it is repayable on 19th April 2012.

xxxi. During the year, a loan of Rs.1,000.00 lacs given to Gulbarga Cement Limited on 28th October 2010 and it is repayable on 27th April 2012.

xxxii. During the year, a loan of Rs.500.00 lacs given to Gulbarga Cement Limited on 26th November 2010 and it is repayable on 25th May 2012.

xxxiii. During the year, a loan of Rs.700.00 lacs given to Gulbarga Cement Limited on 22nd December 2010 and it is repayable on 19th June 2012.

xxxiv. During the year, a loan of Rs.450.00 lacs given to Gulbarga Cement Limited on 30th December 2010 and it is repayable on 29th June 2012.

xxxv. During the year, a loan of Rs.300.00 lacs given to Gulbarga Cement Limited on 21st January 2011 and it is repayable on 20th July 2012.

xxxvi. The loan of Rs.135.00 lacs given to Zuari Investments Limited on 10th February, 2010 and it was repaid on 6th September 2010.

xxxvii. During the year, a loan of Rs.200.00 lacs is given to Zuari Investments Limited on 1st June 2010 and repaid on 6th September 2010.

xxxviii. During the year, a loan of Rs.100.00 lacs is given to Zuari Investments Limited on 1st July 2010 and repaid on 30th August 2010.

xxxix. During the year, a loan of Rs.1,000.00 lacs given to Zuari Investments Limited on 16th September 2010 and it is repayable on 30th September 2011.

xi. During the year, a loan of Rs.4,200.00 lacs is given to Zuari Fertilisers & Chemicals Limited on 15th June 2010 and it is repayable on 15th June 2011.

xii. Figures in brackets denote previous year figures.

6. Segmental Information

§ Primary Segment

The Company is engaged in the manufacture, sale and trading of fertilizers, seeds and pesticides which, in the context of Accounting Standard 17 (Segmental Information) issued by the Institute of Chartered Accountants of India, is considered as the only business segment. Accordingly, no separate segmental information has been provided herein.

§ Secondary Segment – Geographical Segment.

The Company primarily operates in India and therefore mainly caters to the needs of the domestic market. Therefore, there are no reportable geographical segments.

7. Related Party disclosures under Accounting Standard – 18

a) The list of related parties as identified by the management are as under:

i) Subsidiaries of the Company:

(1) Indian Furniture Products Limited

(2) Zuari Seeds Limited

(3) Simon India Limited

(4) Zuari Management Services Limited ( formerly known as Zuari Infrastructure & Developers Limited)

(5) Adventz Infraworld India Limited (formerly known as Zuari Developers Limited)

(6) Gulbarga Cement Limited

(7) Zuari Holdings Limited – 100% Subsidiary-with effect from 10th March, 2011 (earlier subsidiary of Zuari Investments Limited)

(8) Zuari Fertlizers & Chemicals Limited

(9) Globex Limited

(10) Zuari Investments Limited

(11) Zuari Chambal Insurance Brokers Limited – Subsidiary of Zuari Investments Limited

(12) Zuari Commodity Trading limited – Subsidiary of Zuari Investments Limited

(13) Zuari Financial Services Limited – Subsidiary of Zuari Investments Limited

ii) Joint Ventures of the Company:

(1) Zuari Indian Oiltanking Limited

(2) Zuari Maroc Phosphates Limited

(3) Paradeep Phosphates Ltd – Subsidiary of Zuari Maroc Phosphates Limited

(4) Zuari Rotem Speciality Fertilisers Limited

iii) Associates of the Company*:

(1) Style Spa Furniture Limited (An associate of a subsidiary)

* The Company holds more than 20% of the voting power of a body corporate. The Company has been legally advised that it does not have any "significant influence" in the said body corporate as defined in Accounting Standard 18 "Related Party Disclosures" and accordingly has not considered the above investee as related party under AS-18 for the above disclosure.

iv) Key Management Personnel of the Company:

(1) Mr. H.S. Bawa, Executive Vice Chairman

(2) Mr. Suresh Krishnan, Managing Director (with effect from 1st February, 2011)

v) Relatives of Key Management Personnel of the Company:

(1) Mrs. Veena Bawa

(2) Mrs. Seema Behl

(3) Mrs. Meenakshi Bawa

8. Employee benefits :

(A) Gratuity

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy.

The following tables summarize the components of net benefit expense recognized in the Profit & Loss account and the funded status and amounts recognized in the Balance Sheet.

a) 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.

b) The current year being the fifth year of adoption of AS–15 (Revised) by the Company, disclosures as required by Para 120 (n) (i) of Accounting Standard 15 (Revised) have been furnished only from the year of its adoption.

(b) Pursuant to the Scheme of Arrangement between Texmaco Limited and Texmaco Rail and Engineering Limited (TREL) the Company has got one equity share of Re.1/ – each fully paid in TREL for every equity share held in Texmaco Limited. The cost of shares held in Texmaco Limited has been allocated in the ratio of 41.40% and 58.60% to the shares of Texmaco Limited and TREL respectively in accordance with the Scheme.

(b) In terms of guidelines issued by Government of India, Ministry of Chemicals & Fertilizers (MCF) dated 31st March, 2011, the Company has sold 50% of its holding in Fertilizer Companies Government of India Special Bond at price determined by Reserve Bank of India (RBI) resulting in a loss of Rs 3,137.06 lacs (including Rs 2,707.69 lacs charged to Profit & Loss Account in earlier years). As per the guidelines the Government of India will buyback the remaining bonds held by the company through RBI in 2011–12 at a price to be determined by Government of India. As per the above guidelines, a part of the loss incurred by the Company would be compensated by Government of India. However the mechanism for determination of such compensation has not been notified by MCF .On determination of the compensation applicable the same will be accounted for in terms of accounting policies and accounting standards followed by the company.

(c) Provision for diminution in value of Fertilizer Companies' Government of India Special bonds has been done on the basis of quotation received from stock brokers for the closing stocks of respective GoI Bonds.

9. Interest accrued on loans shown under Other Current Assets includes an amount of Rs. 529.30 lacs (previous year Nil) receivable from subsidiaries.

10. Loan to employees and interest accrued on employee's loan include amount due from officer of the Company Rs. 40.01 lacs (including Rs. 37.20 lacs from a Managing Director of the Company being loan given before appointed as Managing Director) (previous year Rs.4.49 lacs) and Rs.5.67 lacs (including Rs. 1.53 lacs from a Managing Director of the Company) (previous year Rs.3.90 lacs) respectively. Maximum amount outstanding at any time during the year is Rs. 41.09 lacs (including Rs. 38.00 lacs from a Managing Director of the Company) (previous year Rs.6.17 lacs) and Rs.5.67 lacs (including Rs. 1.53 lacs from a Managing Director of the Company) (previous year Rs. 3.65 lacs) in respect of loan and interest accrued respectively.

11. (a) Stage III of the New Pricing Scheme (NPS) for Urea was in operation from 1st October, 2006 to 31st March, 2010. As per this scheme, all naptha based units (including the company) were required to take steps for conversion to natural gas/liquid natural gas by 31st March, 2010. The Company has initiated necessary steps for conversion. Government of India vide notification dated 17th March, 2010 has extended till further orders the provisions of Stage III of NPS.

(b) Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard.

(c) Government subsidies include Rs. 6,708.40 lacs (previous year of Rs. 3,396.89 lacs) in respect of earlier years, notified during the year.

12. The Revenue Department of the Government of Goa has issued a notification under sub-section (1) of Section 4 of the Land Acquisition Act, 1984 on 5th February, 2007 and further notification on 19th April, 2007 proposing to acquire 1,59,700 sq. mts. of the land belonging to the Company for public purpose. The Company has filed an appeal with the High Court of Bombay at Goa against the notification. The High Court has asked status quo to be maintained on the land acquisition proceedings.

13. The agreement with Zuari Maroc Phosphates Limited (ZMPL) for providing management services to Paradeep Phosphates Limited, which got suspended on 1st October, 2005, continues to remain so and consequently no management services fees has been accounted for during the year.

14. Investments

i) The Company has invested a sum of Rs.6,583.05 lacs in the equity shares of Nagarjuna Fertilizers and Chemicals Limited (NFCL). The market value of these investments at the year end is Rs.6,032.23 lacs. Hence, there is a diminution in the value of this investment by Rs.550.82 lacs.

ii) The Company has an investment of Rs. 258.90 lacs in the equity shares of Lionel India Limited (LIL). As per the latest audited financial statements of LIL, it has accumulated losses which have resulted in erosion of a major portion of its net worth. LIL is continuously incurring losses.

iii) The Company has invested a sum of Rs. 1,417.60 lacs in the equity shares of one of the 100% subsidiary company. Further, the Company has receivables of Rs. 1,611.26 lacs by way of trade advances. The Company has also given corporate guarantees in respect of facilities given by the banks to the subsidiary company aggregating to Rs. 2,205 lacs and has also promised to provide continuous financial support. As per the latest audited financial statements of this subsidiary, accumulated losses of this subsidiary has resulted in erosion of its net worth.

These being long term investments and also in view of the projected profitable operations of the above companies, management is of the view that the diminution in the value of these investments is temporary in nature and hence no provision (other than the provision accounted for in an earlier year in respect of a subsidiary) is required to be made thereagainst.

15. Pending receipt of appeal effect orders for the assessment years 1998-99 to 2000-01 and 2002-03 to 2005-06, where appeal has been decided partly in favour of the Company by the Income Tax Appellate Tribunal, Interest on income tax refund has not been recognized thereof as the amount is presently not reasonably determinable. Interest income on this refund will be recognized in the year the appeal effect order is received from Income Tax Department.

16. The Company has obtained office premises, apartments and warehouses on operating leases for the period ranging from 2-6 years. In all the cases, the agreements are further renewable at the option of the Company. There is escalation clause in the respective lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the Profit and Loss account for the year are Rs. 455.48 lacs (previous year Rs. 346.67 lacs).

17. Under instructions from the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 10,564 (previous year 10,564) Rights' Equity Shares entitlements have been kept in abeyance pursuant to Section 206A of the Companies Act, 1956

18. Previous year's figures have been regrouped / recasted, wherever necessary to confirm to this year's classification.


Mar 31, 2010

1. Nature of Operations

The Company is the manufacturer of chemical fertilizers and pesticides. The Company is also into trading business of complex fertilizers, seeds and pesticides.

2 Contingent liabilities not provided for : Rs. in lacs

Year ended Year ended

Particulars 31st March, 31st March, 2010 2009



A. Demand Notices received from Sales Tax authorities *

i) Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 2005-06 to 2008-09. The Company has filed appeal before Joint Commissioner of Commercial Taxes (Appeals), Bangalore, against the same. (The Company has deposited Rs.21.28 lacs against the same which is appearing in the schedule of Loans & Advances) 42.56 -

ii) Demand notice from Maharashtra Sales Tax Authorities in respect of Sales tax Assessment for the year 2004-05. The Company has applied for cancellation of assessment order under the Bombay Sales Tax Act 1959. 130.61 -

B. Demand raised by Excise Authorities on Service Tax matters *

Demand notice from Service Tax Authorities towards Service Tax under Goods Transport Agency Services for the period 2006-07 to 2008-09. 76.87 -

C. Taxation matters*.

Penalty u/s 271 ( 1 )(C) of the Income Tax Act, 1961 pertaining to Menalty on capital gain on transfer of Cement undertaking : Income Tax Appellate Tribunal has passed order in favour of the Company during the year - 1,426.16

3. The Board of Directors of the Company approved the merger of Gobind Sugar Mills Limited (GSML) in the meeting held on February 22, 201 0. Pursuant to this approval, the Company has on March 26, 201 0 filed with the Honourable High Court of Bombay at Goa, o scheme of amalgamation entailing merger of GSML with the Company. And GSML has also filed similar scheme of Amalgamation before the Honourable High Court of Calcutta. As per the said scheme, with effect from the Appointed Date i.e. April 01, 2009, the undertaking of GSML, pursuant to the provisions contained in Sections 391 to 394 and other applicable provisions of the Companies Act 1956, shall stand transferred to and vested in the Company on a going concern basis without any further act, deed or matter. However, the Amalgamation shall be effective from the date of filing of the certified copy of the Order of the Honourable High Court of Goa and Calcutta with Registrar of Companies, Goa. Pending the approval of the said High Courts, the effect of the amalgamation has not been given.

4. i) Item 1 and 2 under head Secured Loans are secured by the first charge by way of hypothecation of the current assets, both present and future, wherever situated pertaining to the Company and the Companys present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets.

ii) Item 3 under head Secured Loans was secured by way of pledge of 6.65% Fertilizer Companies Government of India Special Bonds 2023 of Rs.Nil (Previous year Rs. 17,250.00 lacs)

iii) Credit obtained from Indian Oil Corporation Limited against supply of Naphtha to the extent of Rs 248.23 lacs (previous year Rs. 10,716.04 lacs) (balance included under Current Liabilities) is secured by third charge on stocks of Raw materials, Finished goods, stock in trade, stores and spares limited to Rs. 10,000.00 lacs.

Notes :

a) The loan to Indian Furniture Products Limited (IFPL) of Rs. 1,290.77 lacs (Balance outstanding on 31st March, 2010 Rs. 430.26 lacs) is repayable in 36 equal monthly installments w.e.f. 1st April, 2008.

b) The loan to IFPL of Rs 1,000.00 lacs is renewed repayable on 3rd August, 2010.

c) During the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2010 - Rs.77.78 lacs) is given to IFPL on 22™ July, 2009 and it is repayable in 36 equal monthly installments w.e.f 1st August, 2009.

d) The loan of Rs. 4,288.00 lacs to Zuari Developers Limited (in which one of the directors of the Company is interested as director) is repayable at the end of 18 months from 6th February, 2009. Maximum amount of loan outstanding during the year is Rs. 4,288.00 lacs.

e) During the year, a loan of Rs.420.00 lacs (Balance outstanding on 31st March, 2010 Rs.420.00 lacs) is given to Zuari Developers Limited on 13th May, 2009 and it is repayable in 18 months.

f) During the year, a loan of Rs.25.00 lacs (Balance outstanding on 31st March, 2010 - Rs.25.00 lacs) is given to Zuari Developers Limited on 18th August, 2009 and it is repayable in 18,months.

g) During the year, a loan of Rs. 10.00 lacs (Balance outstanding on 31st March, 2010 - Rs. 10.00 lacs) is given to Zuari Developers Limited on 20tn August, 2009 and it is repayable in 18 months.

h) During the year, a loan of Rs.50.00 lacs (Balance outstanding on 31st March, 2010 - Rs.50.00 Iocs) is given to Zuari Developers Limited on 10th September, 2009 and it is repayable in 18 months.

i) During the year, a loan of Rs.l 15.00 lacs (Balance outstanding on 31st March, 2010 Rs.l 15.00 lacs) is given to Zuari Developers Limited on 1 7" November, 2009 and it is repayable in 1 8 months.

i) During the year, a loan of Rs.l 10.00 lacs (Balance outstanding on 31st March, 2010 - Rs.l 10.00 lacs) is given to Zuari Developers Limited on 27" November, 2009 and it is repayable in 18 months.

k) During the year, a loan of Rs.l 50.00 lacs (Balance outstanding on 31st March, 2010 - Rs.l 50.00 lacs) is given to Zuari Developers Limited on 9" February, 2010 and it is repayable in 18 months.

lI) During the year, a loan of Rs.295.00 lacs (Balance outstanding on 31s1 March, 2010 Rs.295.00 lacs) is given to Zuari Developers Limited on 31st March, 2010 and it is repayable in 18 months.

m) The loan to Gulbarga Cements Limited of Rs. 932.32 lacs was renewed on Ist January, 2009 and is repayable in 18 months.

n) During the year, a loan of Rs.25.00 lacs (Balance outstanding on 31st March, 2010 - Rs.10.00 lacs) is given to Gulbarga Cements Limited on 22™ September, 2009 and it is repayable in 18 months.

o) During the year, a loan of Rs.270.00 lacs (Balance outstanding on 31st March, 2010 - Rs.270.00 lacs) is given to Gulbarga Cements Limited on 1 5th January, 2010 and it is repayable in 18 months.

p) During the year, a loan of Rs.200.00 lacs (Balance outstanding on 31st March, 2010 Rs.200.00 lacs) is given to Gulbarga Cements Limited on 31st March, 2010 and it is repayable in 18 months.

q) During/ the year, a loan of Rs.100.00 lacs (Balance outstanding on 31st March, 2010 Rs.Nil) is given to Zuari Investments Limited on 3rd November, 2009 and it is repayable in 6 months. This loan was repaid prior to its original. maturjty date on 26th February, 2010.

r) Dyrtng the year, a loan of Rs.200.00 lacs (Balance outstanding on 31st March, 2010 Rs.Nil) is given to Zuari Investments Limited on 5th November, 2009 and it is repayable in 6 months. This loan was repaid prior to its original maturity date on 26" February, 2010.

s) During the year, a loan of Rs.200.00 lacs (Balance outstanding on 31st March, 2010 Rs.Nil) is given to Zuari Investments Limited on 27" November, 2009 and it is repayable in 6 months. This loan was repaid prior to its original moturity date on 26th February, 2010.

t) During the year, a loan of Rs.165.00 lacs (Balance outstanding on 31st March, 2010 Rs.Nil) is given lo Zuari Investments Limited on 10th February, 2010 and it is repayable in 50 days. This loan was repaid on 31st March, 2010.

u) During the year, a loan of Rs.135.00 lacs (Balance outstanding on 31st March, 2010 - Rs.135.00 lacs) is given to Zuari Investments Limited on 10" February, 2010 and it is repayable on 30" June, 2010.

v) The Company holds more than 20% of the voting power of a body corporate. The Company has been legally advised that it does not have any "significant influence" in the said body corporate as defined in Accounting Standard 1 8 "Related Party Disclosures" and accordingly has not considered the above investee as related party under AS-18 and associate for the above disclosure.

w) Figures in brackets denote previous year figures.

5. Segmental Information

* Primary Segment

The Company is engaged in the manufacture, sale and trading of fertilizers, seeds and pesticides which, in the context of Accounting Standard 17 (Segmental Information) issued by the Institute of Chartered Accountants of India, is considered as the only business segment. Accordingly, no separate segmental information has been provided herein.

* Secondary Segment - Geographical Segment.

- The Company primarily operates in India and therefore mainly caters to the needs of the domestic market. Therefore, there are no reportable geographical segments.

6. Related Party disclosures under Accounting Standard - 18

a) The list of related parties as identified by the management are as under:

i) Subsidiaries of the Company:

(1) Indian Furniture Products Limited

(2) Zuari Seeds Limited

(3) Simon India Limited

(4) Zuari Infrastructure & Developers Limited

(5) Zuari Developers Limited

(6) Gulborga Cement Limited

(7) Zuari Investments Limited

(8) Zuari Insurance Brokers Limited - Subsidiary of Zuari Investments Limited

(9) Zuari Commodity Trading Limited - Subsidiary of Zuari Investments Limited

(10) Zuari Financial Services Limited - Subsidiary of Zuari Investments Limited

(11) Zuari Holdings Limited - Subsidiary of Zuari Investments Limited (with effect from 10th September,2009)

(12) Zuari Fertlizers & Chemicals Limited (with effect from 29" January, 2010)

(13) Globex Limited (with effect from 09" August, 2009)

ii) Joint Ventures of the Company:

(1) Zuari Indian Oiltanking Limited

(2) Zuari Maroc Phosphates Limited

(3) Paradeep Phosphates Ltd - Subsidiary of Zuari Maroc Phosphates Limited

(4) Zuari Rotem Speciality Fertilisers Limited

iii) Associates of the Company*:

(1) Style Spa Furniture Limited (an associate of a subsidiary)

(2) Zuari Investments Limited (upto 301 March, 2009)

(3) Zuari Insurance Brokers Limited (a subsidiary of Zuari Investments Limited) (upto 30th March, 2009)

(4) Zuari Commodity Trading Limited (a subsidiary of Zuari Investments Limited) (upto 30" March, 2009)

(5) Zuari Financial Services Limited (a subsidiary of Zuari Investments Limited) (upto 30" March, 2009) * Refer footnote (v) in Note no. 1 3 above.

iv) Key Management Personnel of the Company: (1) Mr. H.S. Bawa, Managing Director

v; Relatives of Key Management Personnel of the Company: / (1) Mrs. Veena Bawa

(2) Mrs. Seema Behl

(3) Mrs. Meenakshi Bawa

7. Interest accrued on loans shown under Other Current Assets includes an amount of Rs. Nil (previous year Rs. 296.75 lacs) receivable from subsidiaries.

8. Loan to employees and interest accrued on employees loan include amount due from officer of the Company Rs.4.49 lacs (previous year Rs.6.1 7 lacs) and Rs.3.90 lacs (previous year Rs.3.65 lacs) respectively. Maximum amount outstanding at any time during the year is Rs.6.1 7 lacs (previous year Rs.7.85 lacs) and Rs.3.65 lacs (previous year 3.09 lacs) in respect of loan and interest accrued respectively.

9. (a) Stage III of the New Pricing Scheme (NPS) for urea was in operation from 1sl October, 2006 to 31s! March, 2010. As per this scheme, all naptha based units (including the company) were required to take steps for conversion to natural gas/ liquid natural gas by 31st March, 2010. The Company has initiated necessary steps for conversion. Government of India vide notification dated 1 7lh March 2010 has extended till further orders the provisions of Stage III of NPS.

(b) Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard.

(c) Pending announcement of final rates of concession for complex fertilizers for the month of July 2009 to March 2010, the concession for this period has been estimated based on the known policy parameters in this regard and the difference between the notified base rates and estimated rates of concession amounting to Rs. 15,873.97 lacs has been accounted as payable to Government of India.

(d) Government subsidies include Rs. 3,396.89 lacs (previous year of Rs. 1,1 26.84 lacs) in respect of earlier years, notified during the year.

10. The Revenue Department of the Government of Goa has issued a notification under sub-section (1) of Section 4 of the Land Acquisition Act, 1894 on 5lh February, 2007 and further notification on 19th April, 2007 proposing to acquire 1,59,700 sq. mts. of the land belonging to Company for public purpose. The Company has filed an appeal with the High Court of Bombay at Goa against the notification. The High Court has asked status quo to be maintained on the land acquisition proceedings.

11. The agreement with Zuari Maroc Phosphates Limited (ZMPL) for providing management services to Paradeep Phosphates Limited, which got suspended on lsl October, 2005, continues to remain so and consequently no management service fee has been accounted for during the year.

12. Investments

i) The Company has invested a sum of Rs. 1,428.23 lacs in the equity shares of Nagarjuna Fertilizers and Chemicals Limited (NFCL). The market value of these investments at the year end is Rs.l ,31 1.91 lacs. Hence, there is a diminution in the value of this investment by Rs.l 16.32 lacs.

ii) The Company has an investment of Rs. 258.90 lacs in the equity shares of Lionel India Limited (LIL). As per the latest audited financial statements of LIL, it has accumulated losses which have resulted in erosion of a major portion of its net worth. LIL has incurred losses in the last three financial years.

iii) The Company has invested a sum of Rs. 2,856.69 lacs in the equity shares of some of the 1 00% subsidiaries. Further, the Company has given a trade advance of Rs.939.39 lacs to one of the subsidiary and loan of Rs.6,890.32 lacs to two of the subsidiaries. As per the latest audited financial statements of these subsidiaries, accumulated losses of these subsidiaries have resulted in erosion of their net worth.

These being long term investments and also in view of the projected profitable operations of the above companies, management is of the view that the diminution in the value of these investments is temporary in nature and hence no provision (other than the provision accounted for in an earlier year in respect of a subsidiary) is required to be made thereagainst.

13. Under instructions from the Special Court (Trial of Offences relating to Transactions in Securities) Act, 1992 and in respect of shareholders who could not exercise their rights in view of disputes, mistakes, discrepancy in holdings, etc., 10,564 (previous year 10,564) Rights Equity Shares entitlements have been kept in abeyance pursuant to Section 206A of the Companies Act, 1956.

14. Previous years figures have been regrouped / recasted, wherever necessary to confirm to this years classification.

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