Notes to Accounts of Aditya Birla Nuvo Ltd.
Mar 31, 2015
NOTE: 1
DISCONTINUING OPERATIONS
The Company, in its Committee of Directors meeting held on 6th April,
2013, had decided to divest the Carbon Black business with effect from
1st April, 2013, on a going concern basis, by way of a slump sale, to
SKI Carbon Black (India) Private Limited.
In accordance with approval given by the shareholders, the Company had
accounted for slump sale of Carbon Black business (identified as
reportable segment under AS-17) with effect from 1st April, 2013, on a
going concern basis to SKI Carbon Black (India) Private Limited
pursuant to Business Transfer Agreement entered into with them and
accordingly, in the previous year, a gain of Rs. 24.06 Crore on the
said slump sale had been recognised as an exceptional item and a net
tax credit of Rs. 40.70 Crore (including reversal of deferred tax
credit) had been netted off with the tax expense.
NOTE: 2
RETIREMENT BENEFITS
Disclosure in respect of Employee Benefits pursuant to Accounting
Standard-15 (Revised)
(a) The details of the Company''s Defined Benefit Plans in respect of
Gratuity (funded by the Company): General Description of the Plan
The Company operates gratuity plan through a trust wherein every
employee is entitled to the benefit equivalent to fifteen days salary
last drawn for each completed year of service. The same is payable on
termination of service or retirement, whichever is earlier. The benefit
vests after five years of continuous service. In case of some
employees, the Company''s scheme is more favourable as compared to the
obligation under Payment of Gratuity Act, 1972.
NOTE: 3
LIST OF RELATED PARTIES PARTIES WHERE CONTROL EXIST SUBSIDIARIES
Aditya Birla Financial Services Limited (ABFSL) (formerly Aditya Birla
Financial Services Private Limited)
Aditya Birla Capital Advisors Private Limited (ABCAPL)
Aditya Birla Customer Services Limited (ABCSL) (formerly Aditya Birla
Customer Services Private Limited)
Aditya Birla Trustee Company Private Limited (ABTCPL)
Aditya Birla Money Limited (ABML)
Aditya Birla Commodities Broking Limited (ABCBL)
Aditya Birla Financial Shared Services Limited (ABFSSL)
Aditya Birla Finance Limited (ABFL)
Aditya Birla Securities Private Limited (ABSPL) (up to 10th September,
2014)
Aditya Birla Insurance Brokers Limited (ABIBL)
Birla Sun Life Asset Management Company Limited (BSAMC)
Birla Sun Life AMC (Mauritius) Ltd.
Aditya Birla Sun Life AMC Ltd., Dubai
Aditya Birla Sun Life AMC Pte. Ltd., Singapore
India Advantage Fund Ltd. (IAFL)
International Opportunities Fund SPC (IOF)
Birla Sun Life Trustee Company Private Limited (BSTPL)
Aditya Birla Housing Finance Ltd. (ABHFL) (formerly LIL Investment
Limited)
Aditya Birla Money Mart Limited (ABMML)
Aditya Birla Money Insurance Advisory Services Limited (ABMIASL)
ABNL IT & ITES Limited (IT&ITES)
Aditya Birla Minacs BPO Private Limited (ABMBPL)
Aditya Birla Minacs Worldwide Limited (ABMWL) (up to 8th May, 2014)
Aditya Birla Minacs Philippines Inc. (ABMPI) (up to 8th May, 2014)
AV TransWorks Limited. (AVTL) (up to 8th May, 2014)
Aditya Birla Minacs Worldwide Inc. (ABMWI) (up to 8th May, 2014)
Aditya Birla Minacs BPO Limited (ABMBL) (up to 8th May, 2014)
Minacs Worldwide SA de CV (MWSC) (up to 8th May, 2014)
The Minacs Group (USA) Inc. (MGI) (up to 8th May, 2014)
Bureau of Collection Recovery, LLC (BCR) (up to 8th May, 2014)
Bureau of Collections Recovery (BCR) Inc. (up to 8th May, 2014)
Minacs Limited (ML) (up to 8th May, 2014)
Minacs Worldwide GmbH (MWGH) (up to 8th May, 2014)
Minacs Kft. (up to 8th May, 2014)
Aditya Vikram Global Trading House Limited (AVGTHL) (up to 29th
September, 2014)
Birla Sun Life Insurance Company Limited (BSLICL)
Birla Sun Life Pension Management Limited (BSLPML) (w.e.f. 19th
January, 2015)
ABNL Investment Limited (ABNL Inv)
Shaktiman Mega Food Park Private Limited (SMFP)
Madura Garments Lifestyle Retail Company Limited (MGLRCL)
Indigold Trade and Services Limited (ITSL)
Pantaloons Fashion & Retail Limited (PFRL)
OTHER RELATED PARTIES JOINT VENTURES
IDEA Cellular Limited (IDEA) ASSOCIATES
Birla Securities Limited (BSL) (up to 14th November, 2014) K
EY MANAGEMENT PERSONNEL (KMP)
Mr. Lalit Naik - Managing Director (Deputy Managing Director upto 30th
June, 2014)
Mr. Sushil Agarwal - Whole-time Director
Dr. Rakesh Jain - Managing Director (Upto 30th June, 2014)
ENTERPRISES HAVING COMMON KEY MANAGEMENT PERSONNEL (KMP)
Aditya Birla Science & Technology Company Private Limited (ABSTCPL)
(Common KMP Mr. Lalit Naik) (w.e.f. 30th March, 2015)
NOTE: 4
OTHER SIGNIFICANT NOTES
(i) The Company has presented segment information in its Consolidated
Financial Statements, which are part of the same annual report.
Accordingly, in terms of provisions of Accounting Standard on Segment
Reporting (AS-17) no disclosure related to the segment are presented in
the Standalone Financial Statements.
(ii) The Company is one of the Promoter members of Aditya Birla
Management Corporation Private Limited, a Company limited by guarantee
which has been formed to provide a common pool of facilities and
resources to its members, with a view to optimise the benefits of
specialisation and minimize cost to each member. The Company''s share of
expenses under the common pool has been accounted for under the
appropriate head.
(iii) The Company has a process whereby periodically all long-term
contracts are assessed for material foreseeable losses. At the year
end, the Company has reviewed and ensured that adequate provision as
required under any law/accounting standards for material foreseeable
losses on such long-term contracts has been made in the books of
account.
(iv) The Company''s pending litigations comprise of claims by or against
the Company primarily by the workers/employees/ customers/suppliers,
etc., and proceedings pending with tax and other government
authorities. The Company has reviewed 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. In respect of litigations, where the management assessment of
a financial outflow is probable, the Company has made adequate
provision in the financial statements and appropriate disclosure for
contingent liabilities is given in Note 25.
(v) ABNL IT & ITeS Limited, a wholly owned subsidiary of the Company,
at its meeting of the Board of Directors, held on 30th January, 2014,
had approved the divestment of shares held by it in its IT-ITeS
subsidiary, Aditya Birla Minacs Worldwide Limited, and had executed a
Share Purchase Agreement with a group of investors led by Capital
Square Partners and CX Partners subject to fulfilment of requisite
consents and approvals.
All requisite consents and approvals which were part of closing
conditions had been completed. With this divestment, Aditya Birla
Minacs Worldwide Limited and its eleven subsidiaries ceased to be
subsidiaries of Aditye Birla Nuvo Limited, with effect from 9th May,
2014.
(vi) The Board of Directors of Aditya Birla Nuvo Limited (the Company)
at its meeting held on May 03, 2015, have considered and approved a
Composite Scheme of Arrangement between the Company, Madura Garments
Lifestyle Retail Company Limited (MGLRCL) (100% subsidiary) and
Pantaloons Fashion & Retail Limited (PFRL) (72.62% subsidiary) and
their respective shareholders and creditors u/s Sections 391 to 394 of
the Companies Act, 1956 ["Composite Scheme"].
Pursuant to the said scheme Madura Fashion, a branded apparel retailing
division of the Company and Madura Lifestyle, a luxury branded apparel
retailing division of MGLRCL will be demerged into PFRL. Shareholders
to the Company will get 26 new equity shares of PFRL for every 5 equity
shares held in the Company pursuant to demerger of Madura Fashion.
Shareholders of MGLRCL will get 7 new equity shares of PFRL for every
500 equity shares held in MGLRCL. Preference shareholders of MGLRCL
will get 1 new equity share of PFRL. After the scheme of arrangement
new holding of the Company (directly and through other subsidiaries) in
PFRL would be 9.06%.
The Scheme is subject to the necessary statutory and regulatory
approvals including approvals of the respective High Courts, the Stock
Exchanges, SEBI, the respective Shareholders and lenders/creditors of
each of the companies involved in the Composite Scheme. The appointed
date of the Scheme will be 1st April, 2015, and expected to be
consummated in next 6 to 9 months.
(vii) Figures of Rs. 50,000 or less have been denoted by ''Ã''.
(viii) Previous Year''s figures have been regrouped/rearranged, wherever
necessary.
Mar 31, 2014
NOTE: 1
CONTINGENT LIABILITIES NOT PROVIDED FOR
(a) Claims against the Company not
acknowledged as debts Rs. in Crore
Nature of Brief Description of Contingent
Liabilities As at 31st As at 31st
Statute March, 2014 March,2013
Customs
Duty, Departmental appeal against CESTAT
order for deleting demand of 2.04 2.04
Customs Act, payment of duty for non-fulfilment
of provision of EXIM policy related to
1942 Advance Licence obtained by Madura
Coats Ltd.
Demand of Differential Custom Duty
on acquisition of ENKA 1.27 --
Technical Know-how.
Various other cases pertaining to
demand of counter-vailing duty and 1.91 0.33
additional duties on imports,
supplementary Drawback claim, etc.
Excise Duty, Show cause-cum-demand notice for
simultaneous availment of  10.88
Central
Excise C.E. Not. 29/04 & 30/04 date 09.07.2004
for the period 2004-05 to
Act, 1944 2006-07. The matter since has been
decided in favour of the Company.
Show cause-cum-demand notice alleging
that mixing of duty paid 1.62 1.62
dyes amounts to manufacture and
attracts duty for the period from
March 1986 to September 1988.
Show cause-cum-demand notice for
availment of Cenvat Credit on 1.01 1.01
capital goods used exclusively for
manufacture of exempted goods for
the period from April 2005 to March 2007.
Demand for payment of duty for removal
of Refinished Imported 2.03 2.03
Garments without paying duty.
Demand of duty for alleged wrong
availment of benefit of exemption 8.25 8.25
under Notification 38/2003-CE in
respect of readymade garments
procured from job workers.
Show cause-cum-demand notice of excise
duty on inclusion of 1.43 1.06
Type Test Charges with the value of
insulators.
Demand for reversal of Cenvat Credit
on CBFS and other inputs  35.96
allegedly to be used for manufacturing
of electricity sold outside for the
period 2006 to September 2011. Carbon
Black business was divested by way of
slump sale to M/s. SKI Carbon Black
India Pvt. Ltd., w.e.f. 01.04.2013 and,
hence, liability transferred to
new entity.
Demand for reversal of Cenvat Credit
on CBFS alleged to be used for  3.54
generation of Steam sold outside.
Carbon Black business was divested
by way of slump sale to M/s. SKI
Carbon Black India Pvt. Ltd.,
w.e.f. 01.04.2013 and, hence, liability
transferred to new entity.
Various cases demanding duty on removal
of refinished imported 5.74 6.59
goods, reversal of credit on inputs
used for manufacturing dutiable and
exempted goods, etc.
Service Tax, Show cause-cum-demand notices for
availment of Cenvat Credit of 2.25 2.25
Finance Act, Service Tax paid on commission to
overseas agents since services are
1994 not falling under input service for
the period from April 2005 to
March 2010.
Demand for Cenvat Credit of Service
Tax taken on Goods Transport 3.85 4.07
Agency Service on outward
transportation from place of removal
till buyers'' place.
Show cause-cum-demand notice for
reversal of Cenvat Credit of 1.05 1.05
Service Tax on Business Auxiliary
Services.
Demand of Service Tax Due to mismatch
of Freight Inward declared in 1.23 0.42
ER-4 and ST-3 Returns.
Various other cases pertaining to
disallowance of Cenvat Credit of 2.53 2.90
Service Tax on commission paid to
overseas agent, in GTA services,
service for outward transportation and
other services alleging not be
classified as input services for
availment of Cenvat Credit, etc.
Sales Tax, Non-receipt of C & F forms,
disallowance of Input Tax Credit
(ITC) on 9.98 9.98
Commercial purchases by Power Plant, reversal
of ITC, for AY 2006-07.
Tax Act
Demand for Short of Form H, I and C,
Input Tax Credit Short adjusted on 5.37 5.16
Stores Spares.
Demand for Short of Form 12A on sale
to local party who subsequently 1.56 1.79
exported the goods.
Sales tax demand on export to Nepal. Â 1.50
Various other cases in respect of
Short of Form H, I and C, disallowance 1.75 1.71
of input credit, tax demand on freight
charges and on export to Nepal.
Income-tax Various Department Appeals in ITAT,
High Court on 14A disallowance, 36.18 37.70
Act, 1961 disallowance of additional
depreciation, disallowance of
depreciation on goodwill and various
matters.
Various other cases in respect of
Short of Form H, I and C, disallowance 2.16 4.31
of input credit, tax demand on freight
charges and on export to Nepal.
Others
Statutes Labour Reinstatement and Workmen
Compensation cases. 6.82 6.20
Water drawal charges for the period
of April 1999 to till date. 69.72 59.70
Claim by PEDEEE Syria for late supply
under different contracts. 6.24 5.38
Railways demanded Land Licence Fees,
in 2008, for the land used for 5.12 5.26
constructing and connecting siding
with Railway at Sindurwa since 1988.
Demand letter issued by UPSIDC for
making payment of maintenance 18.23 15.27
charges on land allotted in 1983.
Various other cases pertaining to
Industrial Disputes, Railways Licence 22.07 19.20
Fee demand, Textile Cess on readymade
garments, claims made by clients on
sale of securities and other Civil cases.
Grand Total 221.41 257.16
(b) Bills Discounted with Banks 38.17 75.86
(c) Corporate Guarantees given to Banks for loans
taken by subsidiaries 705.53 1,928.79
(d) Corporate Guarantees given in connection with
performance obligation of the subsidiaries 12.10 106.86
(e) Under the Jute Packaging Material (Compulsory use of Packing
Commodities) Act, 1987, a specified percentage of fertilisers
dispatched was required to be supplied in jute bags upto 31st August,
2001. The Company made conscious efforts to use jute packaging material
as required under the said Act. However, due to non-availability of
material as per the Company''s product specifications as well as due to
strong customer resistance to use of jute bags, the specific percentage
could not be adhered to. The Company has received a show cause notice,
against which a writ petition has been filed with the Hon''ble High
Court, which is awaiting for hearing. The Jute Commissioner, Kolkata,
had filed transfer petition, various writ petitions have been filed in
different High Courts by other aggrieved parties, including the
Company, before the Hon''ble Supreme Court of India praying for
consolidation of all cases at one Court. The transfer petition is
pending before the Hon''ble Supreme Court. The Company has been advised
that the said levy is bad in law.
(e) Transfer of investments in IDEA Cellular Ltd. (IDEA) and Birla Sun
Life Insurance Co. Ltd. is restricted by the terms contained in their
respective joint venture agreements. Non-disposal undertakings for
IDEA, Aditya Birla Finance Limited, Pantaloons Fashion & Retail
Limited, Aditya Birla Minacs Worldwide Limited and Madura Garments
Lifestyle Retails Company Limited investments have also been provided
to certain Banks for respective credit facilities extended by them.
Pursuant to the Shareholders'' Agreement entered into with the Joint
Venture partner, the Company has, in respect of Birla Sun Life
Insurance Company Limited, agreed to infuse its share of capital from
time to time to meet the solvency requirement prescribed by the
regulatory authority.
(f) Madura Garments Lifestyle Retail Company Limited (MGLRCL), a
subsidiary of the Company, has issued Zero Coupon Non-Convertible
Debenture (NCD) aggregating Rs. 300 Crore. The Company has entered into
an option agreement with the holders of such NCD pursuant to which the
holders have put option on the Company, and the Company has call option
on the holders on expiry of 24 months from the date of allotment of NCD
at a pre-agreed price. Further, on happening of certain events, the put
option can also be exercised by the holders on the Company on any other
date on happening of such events.
(g) Aditya Birla Finance Limited (ABFL), a subsidiary of the Company,
has issued 10.20% Non-Convertible sub-ordinate Debenture (NCD)
aggregating Rs. 300 Crore. The Company has entered into an option
agreement with the holders of such NCD, pursuant to which the holders
have put option on the Company, and the Company has call option on the
holders on expiry of 36 months from the date of allotment of NCD.
Further, on happening of certain events, the put option can also be
exercised by the holders on the Company on any other date on happening
of such events.
(h) The Company has uncalled commitments in respect of investments in
shares of Indigold Trade and Services Limited amounting to Rs. Nil
(Previous Year: Rs. 28.93 Crore).
NOTE: 2
DISCONTINUING OPERATIONS
The Company, in its Committee of Directors meeting held on 6th April,
2013, had decided to divest the Carbon Black business with effect from
1st April, 2013, on a going concern basis, by way of a slump sale, to
SKI Carbon Black (India) Private Limited.
In accordance with the approval given by the shareholders, the Company
has accounted for slump sale of Carbon Black business (identified as
reportable segment under AS-17) with effect from 1st April, 2013, on a
going concern basis to SKI Carbon Black (India) Private Limited
pursuant to Business Transfer Agreement entered into with them and
accordingly a gain of Rs. 24.06 Crore on the said slump sale has been
recognised as an exceptional item and a net tax credit of Rs. 40.70 Crore
(including reversal of deferred tax credit) has been netted off with
current period tax expense.
In view of the above, the figures for the previous year are strictly
not comparable.
NOTE: 3 RETIREMENT BENEFITS
Disclosure in respect of Employee Benefits pursuant to Accounting
Standard-15 (Revised)
(a) The details of the Company''s Defined Benefit Plans in respect of
Gratuity (funded by the Company):
General Description of the Plan
The Company operates gratuity plan through a trust wherein every
employee is entitled to the benefit equivalent to fifteen days salary
last drawn for each completed year of service. The same is payable on
termination of service or retirement, whichever is earlier. The benefit
vests after five years of continuous service. In case of some
employees, the Company''s scheme is more favourable as compared to the
obligation under Payment of Gratuity Act, 1972.
NOTE: 4
LIST OF RELATED PARTIES
PARTIES WHERE CONTROL EXIST
SUBSIDIARIES
Aditya Birla Financial Services Private Limited (ABFSPL) Aditya Birla
Capital Advisors Private Limited (ABCAPL) Aditya Birla Customer
Services Private Limited (ABCSPL) Aditya Birla Trustee Company Private
Limited (ABTCPL) Aditya Birla Money Limited (ABML)
Aditya Birla Commodities Broking Limited (ABCBL) Aditya Birla Financial
Shared Services Limited (ABFSSL) Aditya Birla Finance Limited (ABFL)
Aditya Birla Securities Private Limited (ABSPL) Aditya Birla Insurance
Brokers Limited (ABIBL) Birla Sun Life Asset Management Company Limited
(BSAMC) Birla Sun Life AMC (Mauritius) Ltd. Aditya Birla Sun Life AMC
Ltd., Dubai Aditya Birla Sun Life AMC Pte. Ltd., Singapore India
Advantage Fund Ltd. Birla Sun Life Trustee Company Private Limited
(BSTPL) Aditya Birla Housing Finance Limited (ABHFL) Aditya Birla Money
Mart Limited (ABMML)
Aditya Birla Money Insurance Advisory Services Limited (ABMIASL) ABNL
IT & ITES Limited (IT&ITES)
Aditya Birla Minacs BPO Private Limited (ABMBPL) Aditya Birla Minacs
Worldwide Limited (ABMWL) Aditya Birla Minacs Philippines Inc. (ABMPI)
AV TransWorks Limited (AVTL)
Aditya Birla Minacs Worldwide Inc. (ABMWI) Aditya Birla Minacs BPO
Limited (ABMBL) Minacs Worldwide SA de CV (MWSC) The Minacs Group (USA)
Inc. (MGI)
Bureau of Collections Recovery, LLC (BCR) Bureau of Collections
Recovery (BCR) Inc. (upto February 20, 2014) Minacs Limited (ML)
Minacs Worldwide GmbH (MWGH) Minacs Kft. Aditya Vikram Global Trading
House Limited (AVGTHL) Birla Sun Life Insurance Company Limited
(BSLICL) ABNL Investment Limited (ABNL Inv) Shaktiman Mega Food Park
Private Limited (SMFP) Madura Garments Lifestyle Retail Company Limited
(MGLRCL) Indigold Trade and Services Limited (ITSL)
Pantaloons Fashion & Retail Limited (PFRL) OTHER RELATED PARTIES JOINT
VENTURES IDEA Cellular Limited (IDEA)
Birla Sun Life Asset Management Company Limited (BSAMC) (Joint Venture
of ABFSPL) (Upto October 10, 2012) Birla Sun Life Trustee Company
Private Limited (BSTPL) (Joint Venture of ABFSPL) (Upto October 10,
2012) ASSOCIATES
Birla Securities Limited (BSL) Key Management Personnel Dr. Rakesh Jain
 Managing Director
Mr. Pranab Barua  Whole-time Director (upto May 15, 2012) Mr. Sushil
Agarwal  Whole-time Director
Mr. Lalit Naik  Deputy Managing Director (w.e.f. January 01, 2013)
Relatives of Key Management Personnel Mrs. Anita Agarwal (Wife of Mr.
Sushil Agarwal)
NOTE: 5
OTHER SIGNIFICANT NOTES
(i) The Board of Directors of the Company has approved allotment of
98.20 Lakh Equity Shares of Rs. 10 each at a premium of Rs. 900.86 each on
8th November, 2013, against warrant allotted on a preferential basis to
the promoter and promoter group company. The Company has received an
amount of Rs. 670.84 Crore (excluding receipt of Rs. 223.62 Crore received
on allotment of warrant) on exercise of warrants. The receipt from the
preferential allotment of the warrants has been fully utilised.
(ii) The Company has presented segment information in its Consolidated
Financial Statements, which are part of the same annual report.
Accordingly, in terms of provisions of Accounting Standard on Segment
Reporting (AS-17), no disclosure related to the segment are presented
in the Standalone Financial Statements.
(iii) ABNL IT & ITeS Limited, a wholly owned subsidiary of the Company,
at its meeting of the Board of Directors held on 30th January, 2014,
has approved the divestment of shares held by it in its IT-ITeS
subsidiary, Aditya Birla Minacs Worldwide Limited, and has executed a
Share Purchase Agreement with a group of investors led by Capital
Square Partners and CX Partners subject to fulfilment of requisite
consents and approvals.
All requisite consents and approvals, which were part of closing
conditions, have been completed. With this divestment, Aditya Birla
Minacs Worldwide Limited and its subsidiaries ceased to be subsidiaries
of Aditya Birla Nuvo Limited, with effect from 9th May, 2014.
(iv) Book Value of certain long-term unquoted investments aggregating
to Rs. 1,546.59 Crore (Previous Year: Rs. 434.01 Crore) are lower than its
cost.
Considering the strategic and long-term nature of the aforesaid
investments and asset base and business plan of the investee companies,
in the opinion of the management, the decline in the market/book value
of the aforesaid investments is of temporary nature, requiring no
provision.
(v) Figures of Rs. 50,000 or less have been denoted by ''Ã''.
(vi) Previous Year''s figures have been regrouped/rearranged, wherever
necessary.
Mar 31, 2013
1 The Hon''ble High Court of Allahabad, vide its order dated December
23, 2011, has upheld the constitutional validity and retrospective
application of entry tax under UP Tax on Entry of Goods into Local Area
Act, 2007, in response to a writ petition filed by the Company earlier.
On further appeal, the Hon''ble Supreme Court, vide its order dated
January 10, 2012, had granted stay on the said order subject to certain
conditions, accordingly, the Company had paid Rs. 47.88 Crore under
protest and submitted bank guarantee aggregating Rs. 42.90 Crore.
Considering the complexities involved and pending final hearing before
the Hon''ble Supreme Court, the Company, in the Previous year, had made
provision for entry tax aggregating Rs. 103.88 Crore, and the same was
considered as an exceptional item.
2 List of Related Parties:
PARTIES WHERE CONTROL EXIST SUBSIDIARIES
Aditya Birla Financial Services Private Limited (ABFSPL) (100%
Subsidiary]
Aditya Birla Capital Advisors Private Limited (ABCAPL) (100%Subsidiary
of ABFSPL]
Aditya Birla Customer Services Private Limited (ABCSPL) (100%
Subsidiary of ABFSPL]
Aditya Birla Trustee Company Private Limited (ABTCPL) (100% Subsidiary
of ABFSPL]
Aditya Birla Money Limited (ABML) (75% Subsidiary of ABFSPL]
Aditya Birla Commodities Broking Limited (ABCBL] (100% Subsidiary of
ABML]
Aditya Birla Financial Shared Services Limited (ABFSSL] (100%
Subsidiary of ABFSPL]
Aditya Birla Finance Limited (ABFL] (100% Subsidiary of ABFSPL]
Aditya Birla Securities Private Limited (ABSPL] (100% Subsidiary of
ABFL]
Aditya Birla Insurance Brokers Limited (ABIBL] (50.01% Subsidiary of
ABFSPL]
Birla Sun Life Asset Management Company Limited (BSAMC] (51% Subsidiary
of ABFSPL] (w.e.f. 10th Oct., 2012, earlier was a Joint Venture]
Birla Sun Life AMC (Mauritius] Ltd. (100% Subsidiary of BSAMC]
Aditya Birla Sun Life AMC Ltd., Dubai (100% Subsidiary of BSAMC]
Aditya Birla Sun Life AMC Pte. Ltd., Singapore (100% Subsidiary of
BSAMC]
India Advantage Fund Ltd. (Subsidiary of BSAMC]
Birla Sun Life Trustee Company Private Limited (BSTPL] (50.85%
Subsidiary of ABFSPL](w.e.f. 10th Oct., 2012, earlier was a Joint
Venture]
Aditya Birla Housing Finance Ltd. (ABHFL] (100% Subsidiary of ABFSPL]
(formerly known as LIL Investment Limited] Aditya Birla Money Mart
Limited (ABMML] (100% Subsidiary of ABFSPL]
Aditya Birla Money Insurance Advisory Services Limited (ABMIASL] (100%
Subsidiary of ABMML]
ABNL IT & ITES Limited (IT&ITES] (100% Subsidiary]
Aditya Birla Minacs Worldwide Limited (ABMWL] (99.85% Subsidiary of
IT&ITES]
Aditya Birla Minacs Philippines Inc. (ABMPI] (100% Subsidiary of ABMWL]
Aditya Birla Minacs BPO Private Limited (ABMBPL] (100% Subsidiary of
ABMWL]
AV TransWorks Limited. (AVTL] (100% Subsidiary of ABMWL]
Aditya Birla Minacs Worldwide Inc. (ABMWI] (100% Subsidiary of AVTL]
Aditya Birla Minacs BPO Limited (ABMBL] (100% Subsidiary of ABMWI]
Minacs Worldwide SA de CV (MWSC] (100% Subsidiary of ABMWI]
The Minacs Group (USA) Inc.(MGI) (100% Subsidiary of ABMWI]
Bureau of Collections Recovery, LLC (BCR) (100% Subsidiary of ABMWI)
Bureau of Collections Recovery (BCR) Inc. (100% Subsidiary of ABMWI)
Minacs Limited (ML) (100% Subsidiary of ABMWI)
Minacs Worldwide GmbH (MWGH) (100% Subsidiary of ABMWI)
Minacs Kft. (100% Subsidiary of MWGH)
Aditya Vikram Global Trading House Limited (AVGTHL) (100% Subsidiary)
Birla Sun Life Insurance Company Limited (BSLICL) (74% Subsidiary)
ABNL Investment Limited (ABNLInv) (100% Subsidiary)
Shaktiman Mega Food Park Private Limited (94% Subsidiary)
Madura Garments Lifestyle Retail Company Limited. (MGLRCL) (100%
Subsidiary)
Indigold Trade and Services Limited (ITSL) (100% Subsidiary)
Pantaloons Fashion & Retail Limited (Formerly Peter England Fashions
and Retail Limited) (PFRL) (50.09% Subsidiary of ITSL)
OTHER RELATED PARTIES JOINT VENTURES
IDEA Cellular Limited (IDEA)
Birla Sun Life Asset Management Company Limited (BSAMC) (ceased to be a
joint venture from 10th Oct., 2012 on becoming Subsidiaries)
Birla Sun Life Trustee Company Private Limited (BSTPL) (ceased to be a
joint venture from 10th Oct., 2012 on becoming Subsidiaries)
ASSOCIATES
Birla Securities Limited. (BSL)
Key Management Personnel
Dr. Rakesh Jain - Managing Director
Mr. Pranab Barua - Whole-time Director (up to 15th May, 2012)
Mr. Sushil Agarwal - Whole-time Director (w.e.f. 01st June, 2011)
Mr. Lalit Naik - Deputy Managing Director (w.e.f. 01st January, 2013)
Relatives of Key Management Personnel
Mrs. Anita Agarwal (Wife of Mr. Sushil Agarwal)
3 In accordance with approval of the shareholders in the extraordinary
general meeting of the Company held on 25th April, 2012, the Company
has on preferential basis, issued 1.65 Crore warrants of Rs. 10 each to
the Promoters and/ or Promoter Group at a price of Rs. 910.86. The
holder of each warrant is entitled to apply for and obtain allotment of
1 equity share against each warrant at any time after the date of
allotment but on or before the expiry of 18 months from the allotment
in one or more tranches. The Company has received an amount of Rs.
375.73 Crore equivalent to 25% of the price and Rs. 456.34 Crore
(excluding receipt of Rs. 152.11 Crore received on allotment of
warrant) on exercise of 66.80 Lakh warrants of Rs. 10 each by the
Promoter Group. The total amount of Rs. 832.08 Crore received from the
preferential allotment of the warrants has been fully utilised.
4 The Company has presented segment information in its Consolidated
Financial Statements, which are part of the same annual report.
Accordingly, in terms of provisions of Accounting Standard on Segment
Reporting (AS-17) no disclosure related to the segment are presented in
the Standalone Financial Statements.
5 The Company, in its Committee of Directors meeting held on 6th
April, 2013, has decided to divest the Carbon Black business with
effect from 1st April, 2013 at an Enterprise Value of Rs. 1,451 Crore,
subject to adjustment for net working capital. The Carbon Black
business is being transferred, on a going concern basis, by way of a
slump sale, to SKI Carbon Black (India) Private Limited. The
transaction is expected to be consummated during the current financial
year subject to necessary approvals.
6 Pursuant to the Scheme of Arrangement (the ''Scheme'') under Sections
391 to 394 of the Companies Act, 1956, the fashion retail business
called the ''Pantaloon Format'' of Pantaloon Retail (India) Limited,
sanctioned by the Hon''ble High Court of Bombay, vide its order dated
1st March, 2013, has been transferred by way of demerger to Pantaloons
Fashion & Retail Limited (Formerly Peter England Fashions and Retail
Limited), a subsidiary of the Company, on a going concern basis with
effect from 8th April, 2013. The Scheme is operative from the appointed
date, i.e., 1st July, 2012.
7 Figures of Rs. 50,000 or less have been denoted by ''IS''.
8 Previous Year''s figures have been regrouped/rearranged, wherever
necessary.
Mar 31, 2012
1 Term/Right attached to Equity Shares
The Company has only one class of equity shares having a par value of
Rs 10/- per share. Each holder of equity shares is entitled to one vote
per share. The Company declares dividend in Indian rupees. The dividend
proposed by the Board of Directors is subject to the approval of the
shareholders in the Annual General Meeting.
In the event of liquidation of the Company, the holders of equity
shares will be entitled to receive remaining assets of the Company,
after distribution to all Preference Shareholders. The distribution
will be in proportion to the number of the equity shares held by the
shareholders.
2 Term of Conversion/Redemption of Preference Shares
In accordance with the Composite Scheme of Arrangement, 10,000 6%
Redeemable Cumulative Preference Share of ' 100/- each fully paid-up
(Previous Year: 10,000) were issued to preference shareholders (other
than the Company) of Peter England Fashions and Retail Limited.
Preference shares carry cumulative dividend @6% p.a. The Company
declares and pays dividend in Indian rupees. The dividend proposed by
the Board of Directors is subject to the approval of the shareholders
in the Annual General Meeting.
These preference shares are redeemable by the Company at any time after
completion of one year and on or before completion of five years from
the 1st January, 2010, at the face value. In the event of liquidation
of the Company before conversion/redemption of preference shares, the
holders of Preference Shares will have priority over Equity Shares in
the payment of dividend and repayment of capital.
3 The Company does not have any holding Company,
4 Share reserved for issue under options and contracts, including the
terms and amounts:
For details of Shares reserved for issue under the Employee Stock
Option (ESOP) Plan of the Company Refer Note 38.
5 There are no Preference Shares issued as fully paid-up pursuant to
any contract in consideration of other than cash or bought back during
the preceding last five years except issue of 10,000 6% Redeemable
Cumulative Preference Shares of Rs 100/- each pursuant to a Scheme of
Composite Arrangement to shareholders of Peter England Fashions and
Retail Limited.
6 In the year 1997, the Company had forfeited 4,487 shares held by 299
holders on account of non-payment of call money with interest on shares
issued against each detachable warrant.
7 3,191,794 equity shares (Previous Year: 3,222,993) are represented
by Global Depository Receipts.
8 During the last five years preceding 31.03.2012, there were 1,048
Bonus Shares (Previous Year: 1,048 Bonus Shares] issued out of shares
kept in abeyance.
9 Figu res in brackets represent corresponding number of shares for
previous year.
Details of Dues to Micro, Small & Medium Enterprises as defined under
MSMED Act, 2006
There are no Micro, Small & Medium Enterprises, to whom the Company
owes dues, which are outstanding for more than 45 days as at 31st
March, 2012, and no interest payment made during the year to any Micro,
Small & Medium Enterprises. This information as required to be
disclosed under the Micro, Small & Medium Enterprises Development Act,
2006, has been determined to the extent such parties have been
identified on the basis of information available with the Company.
Notes:
1. Gross Block of Fixed Assets Includes:
a. The Company's share in assets held under co-ownership - Leasehold
Land Rs 19.53 Crore (Previous Year: Rs 19.55 Crore), Buildings Rs23.85
Crore (Previous Year: Rs 23.85 Crore), Furniture, Fixture & Equipment
Rs 7.94 Crore (Previous Year: Rs 7.92 Crore) and Vehicles and Aircraft
Rs 6.83 Crore (Previous Year: Rs 6.83 Crore).
b. Buildings include Rs 8.19 Crore (Previous Year: Rs 8.19 Crore)
being cost of Debentures and Shares in a company entitling the right of
exclusive occupancy and use of certain premises.
2. For Assets given on Operating Lease - Refer to Note: 40.
3. The Company has made an application for exemption under Section 20
of the Urban Land (Ceiling & Regulation) Act, 1976, for excess land of
4.25 acres (Previous Year: 4.25 acres) at Rishra.
The Company is one of the Promoter member of Aditya Birla Management
Corporation Private Limited, a Company limited by guarantee, which has
been formed to provide a common pool of facilities and resources to its
members, with a view to optimise the benefits of specialisation and
minimise cost to each member. The Company's share of expenses under the
common pool has been accounted for under the appropriate heads. Total
Amount of Deposit Outstanding as on 31st March, 2012, is Rs 3.82 Crore
(Previous Year: Rs 3.12 Crore).
NOTE: 1 CONTINGENT LIABILITIES NOT PROVIDED FOR: Rs in Crore
a) Claims against the Company not acknowledged as debts
Nature of Brief Description of Forum where As at 31st As at
31st
Statute Contingent Liabilities dispute is pending March, 2012 March,
2011
Customs
Duty, Departmental appeal
against CESTAT order High Court-
Karnataka 2.04 -
"Customs
Act, for deleting demand
of payment of duty
1942 for non fulfillment
of provision of EXIM
policy related to
Advance Licence
Excise
Duty, Department issued
show cause cum
Commissioner,
LTU, 10.88 10.88
Central
Excise demand notice for
simultaneous
availment Mumbai Act,
1944 of C.E. Not. 29/04 &
30/04 date 09.07.2004
for the period 2004-05
to 2006-07
Demand for payment of
duty for removal CESTAT-Bangalore 2.03 2.03
of Refinished Imported
Garments without
paying Duty
Demand of duty against
availment of benefit
Hon'ble Supreme
Court 8.25 8.25
of exemption under
Notification 38/2003-CE
in respect of ready
made garments procured
from job workers
Demand for reversal on
cenvat on CBFS & Dy. Commissioner
LTU 32.04 1.42
other inputs allegedly
to be used for Mumbai
manufacturing of
electricity sold outside
for the period 2006 to
September 2011
Demand of difference
in duty on processing Dy. Commissioner 4.09 2.69
of yarn from Cake to
Cone Commissioner-LTU,
Mumbai
Demand for reversal of
cenvat on CBFS High Court,
Allahabad 3.27 3.27
alleged to be used for
generation of Steam
Demand for reversal of
cenvat of Service Tax Commissioner 1.05 1.05
on business auxiliary
services
Sales Tax Demand against C & F
forms and also against
Joint
Commissioner of 10.68 -
Input Tax Credit (ITC)
on purchases by Power
Sales Tax
(Appeals),
Rajkot
Plant, reversal of ITC,
for AY 2006-07
Demand against issue
of Form C against High Court,
Lucknow 74.69 38.61
supply of Natural Gas
during F.Y. 2009-10,
FY 2010-11 and FY
2011-12
Demand of Entry Tax Supreme Court - 69.84
Sales Tax demand on
export to Nepal High Court,
Allahabad 1.43 1.17
Demand against Form
H, I & C, ITC Short W.B.Commercial
Tax, 4.94 4.90
adjusted on Stores
Spares Revisional
Board
Service Tax, Demand
of Service Tax on
Commission paid CESTAT Kolkata - 1.12
Finance Act, to overseas
agents during the period
from 1994 01.10.2002 to
31.03.2006
Demand for reversal of
cenvat of Service Tax Commissioner-
LTU, Mumbai 4.04 3.67
taken on Goods transport
Agency service on
outward transportation
Others Demand of textile cess on
removal of Ready High Court,
Karnataka 2.14 2.14
made garments
Payment of Wages of
Strike Period Industrial
Tribunal,
Rajkot 3.12 3.12
Labour Reinstatement
& Workmen Labour
Court 5.77 5.47
Compensation cases
Claim by PEDEEE Syria for
late supply Syrian Arab
republic
Council 1.20 1.05
under different contracts of State,
Administra
tional
Judicature
Court, Syria
HPCL arbitration for supply
of low sulphur CIT (Appeals) 1.04 1.04
heavy stocks and other
liquid fuels
Railways demanded Land
Licence Fees, DRM, Northern
Railways, 3.50 3.50
in 2008, for the land
used for constructing LKO
and connecting siding with
Railway at
Sindurwa since 1988
Demand letter issued by
UPSIDC for High Court,
Lucknow 11.17 8.21
making payment of mainten
ance charges
on land allotted in 1983
Demand of water drawal
charges by High Court,
Gujarat 50.59 -
irrigation department
Recovery of payment for
material not supplied/
Contract cancelled 5.92 5.92
Income Tax Various Department Appeal
in ITAT, High ITAT, High
Court 52.22 57.89
Act, 1961 Court on various matter
Demand for various additions
in tax CIT
(Appeals) 1.59 0.61
assessment of AY 2008-09
& 2009-10
Penalty on disallowance of
provision of CIT
(Appeals) - 3.11
leave salary
Various others cases 21.36 20.88
Grand
Total 319.05 261.84
b) Bills Discounted with Banks 124.02 89.99
c) Corporate Guarantees given to Banks for
loans taken by subsidiaries 930.82 510.58
d) Corporate Guarantees given in connection
with performance obligation 99.76 87.07
of the subsidiaries
e) Under the Jute Packaging Material (Compulsory use of Packing
Commodities) Act, 1987, a specified percentage of fertilisers
dispatched was required to be supplied in jute bags up to 31st August
2001. The Company made conscious efforts to use jute packaging material
as required under the sad Act. However, due to non-availability of
material as per the Company's product specifications as well as due to
strong customer resistance to use of jute bags, the specific percentage
could not be adhered to. The Company has received a show cause notice,
againstwhich a writ petition has been filed with the Hon'ble High
Court, which is awaiting for hearing. The Jute Commissioner, Kolkata
had filed transfer petition, various writ petitions have been filed in
different High Courts by other aggrieved parties, including the
Company, before the Hon'ble Supreme Court of India, praying for
consolidation of all cases at one Court. The transfer petition is
pending before the Hon'ble Supreme Court. The Company has been advised
that the said levy is bad in law.
d) For commitment under lease contract Refer Note 39.
e) Transfer of investments in IDEA Cellular Ltd. (IDEA) and Birla Sun
Life Insurance Co. Ltd. is restricted by the terms contained in their
respective joint venture agreements. Non-disposal undertakings for
IDEA, Aditya Birla Minacs Worldwide Ltd and Madura Garments Lifestyle
Retail Company Limited investments have also been provided to certain
Banks for respective credit facilities extended by them.
Pursuant to the Shareholders' Agreement entered into with the Joint
Venture partner, the Company has, in respect of Birla Sun Life
Insurance Company Limited, agreed to infuse its share of capital from
time to time to meet the solvency requirement prescribed by the
regulatory authority.
f) Aditya Birla Minacs Worldwide Ltd. (ABMWL), a subsidiary of the
Company, has issued Zero Coupon Compulsorily Convertible Debentures
(CCD) aggregating ' 250 Crore to be converted into Equity of ABMWL on
the expiry of a period of 60 months from the date of allotment of such
CCD. The Company has entered into an option agreement with the
subscribers of such CCD, pursuant to which the subscribers has put
option on the Company and the Company has call option on the
subscribers on 22nd May, 2012, at a pre-agreed price. Further, on
happening of certain events, the put option can also be exercised by
the subscribers on the Company on any other date on happening of such
events.
g) Madura Garments Lifestyle Retail Company Limited (MGLRCL), a
subsidiary of the Company, has issued Zero Coupon Compulsorily
Convertible Debenture (CCD) aggregating ' 300 Crore to be converted
into Equity of MGLRCL on the expiry of a period of 60 months from the
date of allotment of such CCD. The Company has entered into an option
agreement with the subscribers of such CCD, pursuant to which the
subscribers has put option on the Company and the Company has call
option on the subscribers on expiry of 24, 36, 48 and 60 months from
the date of allotment of CCD at a pre-agreed price. Further, on
happening of certain events, the put option can also be exercised by
the subscribers on the Company on any other date on happening of such
events.
2 Disclosure under Employee Stock Option Scheme
Under the Employee Stock Option Scheme - 2006 (ESOS-2006), the Company
has granted options to the eligible employees of the Company and its
Subsidiaries. During the year under ESOS-2006, 3,370 options have been
granted as 'Tranche-V' on 23rd May, 2011, to the eligible employees of
the Company. These options are convertible into equivalent equity
shares of the Company. The details are as under:
The ESOP compensation cost is amortised on a straight-line basis over
the total vesting period of the options. Accordingly Rs 0.18 Crore
{net of recovery of Rs IS Crore from the subsidiaries} (Previous Year :
Rs 1.96 Crore net of recovery of Rs 0.05 Crore from the subsidiaries)
has been charged to the Statement of Profit and Loss.
For the option exercised during the period, the weighted average share
price at the exercise date was Rs 927.92 per share (Previous Year : no
option exercised).
The weighted average remaining contractual life for the stock options
outstanding as at 31st March, 2012, is 3.35 years (Previous Year : 3.25
years).
NOTE : 3
Disclosure in respect of Related Parties pursuant to Accounting
Standard-18 Sl. No. List of Related Parties:
Parties where control exist SUBSIDIARIES
1 Aditya Birla Financial Services Private Limited (ABFSPL) (100%
Subsidiary]
1.1 Aditya Birla Capital Advisors Private Limited (ABCAPL) (100%
Subsidiary of ABFSPL)
1.2 Aditya Birla Customer Services Private Limited (ABCSPL) (100%
Subsidiary of ABFSPL)
1.3 Aditya Birla Trustee Company Private Limited (ABTCPL) (100%
Subsidiary of ABFSPL)
1.4 Aditya Birla Money Limited (ABML) (75% Subsidiary of ABFSPL)
1.4.1 Aditya Birla Commodities Broking Limited (ABCBL) (100% Subsidiary
of ABML)
1.5 Aditya Birla Financial Shared Services Limited (ABFSSL) (100%
Subsidiary of ABFSPL)
1.6 Aditya Birla Finance Limited (ABFL) (100% Subsidiary of ABFSPL)
1.6.1 Aditya Birla Securities Private Limited (ABSPL) (100% Subsidiary
of ABFL w.e.f. 31st July, 2010)
1.7 Aditya Birla Insurance Brokers Limited (ABIBL) (50.01% Subsidiary
of ABFSPL)
1.8 Aditya Birla Money Mart Limited (ABMML) (100% Subsidiary of ABFSPL)
1.8.1 Aditya Birla Money Insurance Advisory Services Limited (100%
Subsidiary of ABMML)
2 Aditya Birla Minacs Worldwide Limited (ABMWL) (99.85% Subsidiary)
2.1 Transworks Inc (TW Inc) (100% Subsidiary of ABMWL) (upto 9th
October, 2011)
2.2 Aditya Birla Minacs Philippines Inc. (ABMPI) (100% Subsidiary of
ABMWL)
2.3 AV TransWorks Limited. (AVTL) (100% Subsidiary of ABMWL)
2.3.1 Aditya Birla Minacs Worldwide Inc. (ABMWI) (100% Subsidiary of
AVTL)
2.3.1.1 Aditya Birla Minacs BPO Limited (ABMBL) (100% Subsidiary of
ABMWI)
2.3.1.1.1 Aditya Birla Minacs BPO Private Limited (ABMBPL) (100%
Subsidiary of ABMBL)
2.3.1.1.2 Compass BPO Inc. (100% Subsidiary of ABMBL) (Upto 29th
September, 2011)
2.3.1.2 Minacs Worldwide SA de CV (MWSC) (100% Subsidiary of ABMWI)
2.3.1.3 The Minacs Group (USA) Inc. (MGI) (100% Subsidiary of ABMWI)
2.3.1.3.1 Bureau of Collection Recovery, LLC (BCR) (100% Subsidiary of
MGI) (w.e.f. 2nd June, 2010)
2.3.1.4 Bureau of Collections Recovery (BCR) Inc. (w.e.f. 4th March,
2011) (100% Subsidiary of ABMWI)
2.3.1.5 Minacs Limited (ML) (100% Subsidiary of ABMWI)
2.3.1.6 Minacs Worldwide GmbH (MWGH) (100% Subsidiary of ABMWI)
2.3.1.6.1 Minacs Kft. (100% Subsidiary of MWGH)
3 Aditya Vikram Global Trading House Limited (AVGTHL) (100% Subsidiary]
4 Birla Sun Life Insurance Company Limited (BSLICL) (74% Subsidiary)
5 ABNL Investment Limited (ABNLInv) (100% Subsidiary)
6 Shaktiman Mega Food Park Private Limited (w.e.f. 2nd December, 2010)
(94% Subsidiary)
7 Madura Garments Lifestyle Retail Company Limited (MGLRCL) (100%
Subsidiary)
8 Peter England Fashions and Retail Limited (PEFRL) (100% Subsidiary)
9 Indigold Trade and Services Limited (ITSL) (w.e.f. 30th June, 2010)
(99.99% Subsidiary)
10 LIL Investment Limited (LIL) (w.e.f. 30th June, 2010) (99.99%
Subsidiary)
JOINT VENTURES
1 Birla Sun Life Asset Management Company Limited (BSAMC) (Joint
Venture of ABFSPL)
2 Birla Sun Life Trustee Company Private Limited (BSTPL) (Joint Venture
of ABFSPL)
3 IDEA Cellular Limited (IDEA)
ASSOCIATES
1 Birla Securities Limited (BSL)
2 Indigold Trade and Services Limited (ITSL) (Upto 29th June, 2010)
3 LIL Investment Limited (LILIL) (Upto 29th June, 2010)
Key Management Personnel
1 Dr. Rakesh Jain - Managing Director
2 Mr. Pranab Barua - Whole-time Director
3 Mr. Sushil Agarwal- Whole-time Director (w.e.f. 1st June, 2011)
4 Mr. K.K. Maheshwari - Whole-time Director (upto 20th May, 2010)
Relatives of Key Management Personnel
1 Mrs. Anita Agarwal (Wife of Mr. Sushil Agarwal)
2 Mrs. Sharda Maheshwari (Wife of Mr. K.K. Maheshwari)
General Description Fair Value of the Plan
The Company operates gratuity plan through a trust wherein every
employee is entitled to the benefit equivalent to fifteen days salary
last drawn for each completed year of service. The same is payable on
termination of service or retirement, whichever is earlier. The benefit
vests after five years of continuous service. In case of some
employees, the Company's Scheme is more favourable as compared to the
obligation under Payment of Gratuity Act, 1972.
4 The Company has presented segmental information in its Consolidated
Financial Statements, which are part of the same annual report.
Accordingly, in terms of provisions of Accounting Standard on Segment
Reporting (AS-17) no disclosure related to the segment are presented in
the Standalone Financial Statements.
5 Subsequent Events
a) The Board of Directors of the Company at its meeting held on 30th
April, 2012, has, in principle approved, subject to necessary
approvals, the proposed acquisition of a controlling stake in Future
Group's 'Pantaloons Format Business' post its demerger from Pantaloon
Retail (India) Ltd. (PRIL) either directly or through its subsidiary
company. PRIL will issue debentures to the company/its subsidiary worth
Rs 800 Crore convertible in the equity shares of the resulting entity on
mutually agreed terms. The transaction is likely to be completed in the
next 8-10 months time, subject to the finalisation of the Scheme of
Arrangement, due diligence, statutory and other requisite approvals.
b) The Board of Directors of the Company at their meeting, held on 26th
March, 2012, have, subject to necessary approval(s) and in accordance
with the provisions of SEBI (Issue of Capital and Disclosure
Requirements) Regulations, 2009, approved issuance of 1.65 Crore
warrants to Promoter and/or Promoter Group, entitling the holder
thereof to get one equity share of Rs 10/- each of the Company against
each warrant within a period of eighteen months from the date of
allotment. Subsequently, the Members of the Company in the
Extraordinary General Meeting held on 25th April, 2012, have also
approved issue of the said warrants.
Further, on receipt of 25% of the price fixed per warrants on 10th May,
2012, the Company has issued and allotted 1.65 Crore Warrants to the
Promoter Group Companies on a preferential basis.
6 Figures of Rs 50,000 or less have been denoted by 'IS'.
7 Previous Year's figures have been regrouped/rearranged wherever
necessary.
Mar 31, 2011
Current Year Previous Year
1. Contingent Liabilities not
provided for:
a) Claims against the Company not
acknowledged as debts:
i) Income-tax 61.69 82.52
ii) Custom Duty 0.24 0.23
iii) Excise Duty 34.88 29.06
iv) Sales Tax 184.18 85.72
v) Service Tax 4.74 1.04
vi) Others 36.41 35.05
b) Bills discounted with Banks 89.99 66.16
c) Corporate Guarantees given to Banks
for Loans taken by subsidiaries 510.58 356.39
d) Corporate Guarantees given in
connection with performance obligation
of the subsidiaries 87.07 88.88
e) Customs Duty on capital goods and raw
materials imported under advance
licensing/EPCG Scheme, against which
export obligation is to be fulfilled 18.71 42.96
f) Under the Jute Packaging Material (Compulsory Use of Packing
Commodities) Act, 1987, a specified percentage of fertilisers
dispatched was required to be supplied in jute bags up to 31st August,
2001.
The Company made conscious efforts to use jute packaging material as
required under the said Act. However, due to non-availability of
material as per the Company's product specifications as well as due to
strong customer resistance to use of jute bags, the specific percentage
could not be adhered to. The Company has received a show cause notice,
against which a writ petition has been filed with the Hon'ble High
Court, which is awaiting for hearing. The Jute Commissioner, Kolkata,
had filed transfer petition, various writ petitions have been filed in
different High Courts by other aggrieved parties, including the
Company, before the Hon'ble Supreme Court of India praying for
consolidation of all cases at one Court. The transfer petition is
pending before the Hon'ble Supreme Court. The Company has been advised
that the said levy is bad in law.
g) Idea Cellular Ltd. (Idea), in which the Company has the largest
shareholding, was originally a tripartite joint venture between Aditya
Birla Group, Tata Group and AT&T Group. With the exit of AT&T and the
Tata Group, Idea is now part of the Aditya Birla Group. Prior to its
exit, Tata Group had alleged that the Aditya Birla Group had committed
material breach of the Shareholders' Agreement and the Tata Group
invoked the arbitration clause, pursuant to which an Arbitral Tribunal
has been constituted, which will take up the claims of the Tata Group
and the counter-claims of the Aditya Birla Group.
When the Tata Group sold its shares in Idea to the Company, they
claimed to have reserved certain rights under the Share Purchase
Agreement, which contained a clause for arbitration by the London Court
of International Arbitration (LCIA). The Company, along with another
Aditya Birla Group Company, has questioned the reservation and the LCIA
is seized of the matter. The Company believes that it has a strong case
to counter the allegations of breach and it does not contemplate any
liability to arise on this matter.
b) Aditya Birla Minacs Worldwide Ltd. (ABMWL), a subsidiary of the
Company, has issued Zero Coupon Compulsorily Convertible Debentures
(CCD) aggregating Rs. 250 Crore to be converted into Equity of ABMWL on
the expiry of a period of 60 months from the date of allotment of such
CCD. The Company has entered into an option agreement with the
subscribers of such CCD pursuant to which the subscribers has put
option on the Company and the Company has call option on the
subscribers on expiry of 24, 36, 48 and 60 months from the date of
allotment of CCD at a pre-agreed price. Further, on happening of
certain events, the put option can also be exercised by the subscribers
on the Company on any other date on happening of such events.
c) Madura Garments Lifestyle Retail Company Ltd. (MGLRCL), a subsidiary
of the Company, has issued 0.01% Coupon Compulsorily Convertible
Preference Shares (CCPS) aggregating Rs. 300 Crore to be converted into
Equity of MGLRCL on the expiry of a period of 60 months from the date
of allotment of such CCPS. The Company has entered into an option
agreement with the subscribers of such CCPS pursuant to which the
subscribers has put option on the Company, and the Company has call
option on the subscribers on expiry of 24, 36, 48 and 60 months from
the date of allotment of CCPS at a pre- agreed price. Further, on
happening of certain events, the put option can also be exercised by
the subscribers on the Company on any other date on happening of such
events.
2. Disclosure pursuant to Clause 49 of the Listing Agreement
(Disclosure related to Proceeds from Public Issues, Rights Issues,
Preferential Issues, etc.)
In accordance with approval of the shareholders in the extraordinary
general meeting of the Company held on 17th June, 2009, the Company
had, on a preferential basis, issued 1.85 Crore Warrants of Rs. 10 each
to the Promoter and/or Promoter Group at a price of Rs. 541.19 each.
The holder of each Warrant was entitled to apply for and obtain
allotment of 1 Equity Share against each Warrant at any time after the
date of allotment but on or before the expiry of 18 months from the
allotment in one or more tranches. Out of the above 1.85 Crore
Warrants, 80 Lakh Warrants had been converted and corresponding shares
were issued on 30th October, 2009. On 20th December, 2010, the Company
has allotted balance 1.05 Crore Equity Shares of the Company against
the conversion of equivalent number of Warrants. The total amount
received from the preferential allotment has been fully utilised.
4. Disclosure under Clause 12 of SEBI Employee Stock Option Scheme
(ESOS) Guidelines, 1999
a) Under the Employee Stock Options Scheme-2006 (ESOS-2006), the
Company has granted options to the eligible employees of the Company
and its Subsidiaries.
During the year under ESOS-2006, 17,174 options have been granted as
'Tranche III' on 20th August, 2010 and 11,952 options have been granted
as 'Tranche IV' on 8th September, 2010 to the eligible employees of the
Company.
During the year, the ESOS Compensation Committee of the Board of
Directors has approved the repricing of the existing outstanding Stock
Options, viz., 113,544 and 63,047 granted under Tranche I on 23rd
August, 2007 and Tranche II on 25th January, 2008, respectively, at an
exercise price of Rs. 687 per option, without any change in the vesting
schedule. and terms and conditions governing the said Stock Options.
The same has been approved by the Annual General Meeting on 6th August,
2010.
In respect of repricing of the existing Outstanding Stock Options, the
incremental intrinsic value of the options is accounted as employee
cost over the remaining vesting period.
The ESOP compensation cost is amortised on a straight-line basis over
the total vesting period of the options. Accordingly, Rs. 1.96 Crore
{net of recovery of Rs. 0.05 Crore from the subsidiaries} (Previous
Year: Rs. 0.10 Crore net of recovery of Rs. 0.01 Crore from the
subsidiaries) has been charged to the current year Profit and Loss
Account.
b) Employee Stock Options Outstanding account Rs. 4.53 Crore (Previous
Year: Rs. 2.51 Crore) and Deferred Employee Compensation account Rs.
0.39 Crore (Previous Year: Rs. 0.38 Crore).
3. i) Pursuant to the Composite Scheme of Arrangement (the Scheme)
under Sections 391 and 394 of the Companies Act, 1956, with effect from
1st January, 2010 (the appointed date), Madura Garments Exports Limited
(MGEL), MG Lifestyle Clothing Company Private Limited (MGCCPL) and
domestic garment business of Peter England Fashions and Retail Limited
(PEFRL) had been merged with the Company. The effective date of the
Scheme was 22nd February, 2010.
ii) As consequence of the Scheme, the Company has issued and allotted
to the preference shareholder(s) of PEFRL (other than the Company) one
fully paid-up 6% Redeemable Preference Share of Rs. 100 each of the
Company as fully paid-up for every one 6% Redeemable Preference Share
of Rs. 100 each fully paid-up and held in PEFRL.
iii) In view of the aforesaid Scheme effective from 1st January, 2010,
the previous year numbers are not comparable with current year.
III) Foreign Currency Loans have been fully hedged for foreign exchange
and interest rate fluctuation by way of Currency and Interest Rate
Swaps, Interest Swaps and Long Term Forward Contracts.
4. a) Book values of certain long term unquoted investments
aggregating to Rs. 2,271.56 Crore (Previous Year: Rs. 2,311.47 Crore)
are lower than its cost.
Considering the strategic and long-term nature of the aforesaid
investments and asset base and business plan of the investee companies,
in the opinion of the management, the decline in the book value of the
aforesaid investments is of temporary nature, requiring no provision.
An amount of Rs. 19.95 Crore is lying in "Investment Reserve" is to be
used to meet the diminution other than temporary, if any, that may
arise in future, in the value of present and future long term strategic
investments.
b) Transfer of investments in IDEA Cellular Ltd. (IDEA) and Birla Sun
Life Insurance Co. Ltd. is restricted by the terms contained in their
respective joint venture agreements. Non-disposal undertakings for
IDEA, Aditya Birla Minacs Worldwide Ltd., Aditya Birla Minacs IT
Services Limited and Madura Garments Lifestyle Retail Company Limited
investments have also been provided to certain Banks for respective
credit facilities extended by them.
c) Pursuant to the Shareholders' Agreement entered into with the Joint
Venture partner, the Company has, in respect of Birla Sun Life
Insurance Company Limited, agreed to infuse its share of capital from
time to time to meet the solvency requirement prescribed by the
regulatory authority.
5. a) Disclosure pursuant to Clause 32 of Listing Agreement
b) The Company is one of the Promoter Members of Aditya Birla
Management Corporation Pvt. Limited, a company limited by guarantee
which has been formed to provide a common pool of facilities and
resources to its members, with a view to optimise the benefits of
specialisation and minimise cost to each member. The Company's share of
expenses under the common pool has been accounted for under the
appropriate heads. Total outstanding receivable as on 31st March, 2011,
is Rs. 3.12 Crore (Previous Year: Rs. 3.12 Crore).
Expenses towards gratuity and leave encashment provisions are
determined actuarially on an overall Company basis at the end of each
year and accordingly have not been considered in the above information.
Employee Compensation under Employee Stock Option Scheme has also not
been considered in the above information.
6. Disclosure in respect of Related Parties pursuant to Accounting
Standard 18 Ã refer Annexure II.
7. For Derivative Information à refer Annexure III.
8. The Company has fertilisers bonds of Rs. 65.5 Crore received from
the Ministry of Fertilisers, the Government of India against the
outstanding amount of subsidy receivable, out of which bonds amounting
to Rs. 20.30 Crore (Previous Year: Rs. 29.33 Crore) are outstanding at
the year end. The market value of above bonds are lower than book
value, therefore the diminution in the value of above bonds amounting
to Rs. 0.47 Crore (Previous Year: Rs. 0.46 Crore) has been accounted
under Miscellaneous Expenses. The aforesaid bonds have been classified
as "Other Current Assets" in the financial statements.
9. Other Interest include Interest on Income Tax Refund of Rs. 0.92
Crore (Previous Year: Rs. 2.34 Crore).
10. In September 2005, the Company had purchased 37.18 Crore equity
shares of IDEA Cellular Ltd. (IDEA) from M/s. AT&T Cellular Pvt. Ltd.,
Mauritius, and paid consideration of US$ 150 Million without deduction
of tax at source after obtaining an order under Section 195(2) of the
Income Tax Act from the Income Tax Department. The Deputy Director of
Income Tax (International Taxation), (DDIT), Mumbai, has issued order
under Section 163(1) of the Income Tax Act dated 25th March, 2009,
treating the Company as an agent of New Cingular Wireless Services Inc.
for the sale of shares of IDEA by its subsidiary AT&T Cellular Private
Limited, Mauritius. The Company has challenged the order of DDIT before
the appropriate authority and based on the opinion of Tax Expert, the
Company is reasonably certain that no tax liability would devolve.
11. For additional information as required under paras 3, 4C and 4D of
Part II of Schedule VI to the Companies Act, 1956 Ã refer Annexure IV.
12. Segments have been identified in line with the Accounting Standard
on Segment Reporting (AS-17), taking into account the organisational
structure as well as differential risk and returns of these segments.
Fashion and Lifestyle Branded Apparels and Accessories
Rayon Yarn Viscose Filament Yarn, Caustic Soda and Allied Chemicals
Carbon Black Carbon Black
Insulators Insulators
Textiles Spun Yarn and Fabrics
Agri-business Urea, Ammonia, Argon Gas, Pesticides and Seeds
The Company considers secondary segment based on revenues within India
as Domestic Revenues and outside India as Export Revenues. Since assets
are used interchangeably, carrying amount of assets and cost incurred
during the year to acquire assets based on secondary segment have not
been disclosed.
For Segment Information à refer Annexure V.
13. Figures of Rs. 50,000 or less have been denoted by Ã.
14. Previous Year's figures have been regrouped/rearranged wherever
necessary.
The Guidance Note on implementation of AS-15 (Revised), "Employee
Benefits" issued by the ICAI states that Provident Fund set up the
employers, which requires interest shortfall to be met by the employer,
needs to be treated as defined benefits plan. The Company set up
Provident Fund does not have existing deficit of interest shortfall.
With regards to future obligations arising due to interest shortfall
(i.e., government interest to be paid on the Provident Fund Scheme
exceeding rate of interest earned on investment) pending issuance of
the Guidance Note from Actuarial Society of India, the Company's
actuary has expressed its inability to reliably measure the Provident
Fund liability.
The Company contributes 12% of salary for all eligible employees
towards Provident Fund managed either by approved trusts or by the
Central Government.
a) List of Related Parties:
I. Parties where control exists à Subsidiaries:
1. Aditya Birla Financial Services Private Limited (ABFSPL)
1.1 Aditya Birla Capital Advisors Private Limited (ABCAPL)
1.2 Aditya Birla Customer Services Private Limited (ABCSPL)
1.3 Aditya Birla Trustee Company Private Limited (ABTCPL)
1.4 Aditya Birla Financial Shared Services Limited (ABFSSL)
1.5 Aditya Birla Money Limited (ABML)
1.5.i) Aditya Birla Commodities Broking Limited (ABCBL)
1.6 Aditya Birla Insurance Brokers Limited (ABIBL)
1.7 Aditya Birla Finance Limited (ABFL)
1.7.i) Aditya Birla Securities Private Limited (ABSPL)( w.e.f. 31st
July, 2010)
1.8 Aditya Birla Money Mart Limited (ABMML)
1.8.i) Aditya Birla Money Insurance Advisory Services Limited (ABMIASL)
2. Aditya Birla Minacs Worldwide Limited (ABMWL)
2.1 Transworks Inc. (TW Inc.)
2.2 Aditya Birla Minacs Philippines Inc. (ABMPI)
2.3 AV TransWorks Limited (AVTL)
2.3.i) Aditya Birla Minacs Worldwide Inc. (ABMWI)
2.3.i(a) Aditya Birla Minacs BPO Limited (formerly known as Compass BPO
Limited, U.K. (w.e.f. 9th March, 2010)
2.3.i(a)i) Compass BPO, Inc. (w.e.f. 9th March, 2010)
2.3.i(a)ii) Aditya Birla Minacs BPO Private Limited (formerly known as
Compass Business Process Outsourcing Limited) (w.e.f. 9th March, 2010)
2.3.i(a)iii) Compass BPO FZe (w.e.f. 9th March, 2010 upto 24th
February, 2011)
2.3.i(b) Minacs Worldwide SA de CV
2.3.i(c) The Minacs Group (USA) Inc.
2.3.i(c)i) Bureau of Collection Recovery, LLC (w.e.f. 2nd June, 2010)
2.3.i(d) Minacs Limited
2.3.i(d)i) Minacs Worldwide GmbH
2.3.i(d)i)a) Minacs Kft.
2.3.i(e) Bureau of Collections Recovery (BCR) Inc. (w.e.f. 4th March,
2011)
3. Aditya Vikram Global Trading House Limited (AVGTHL)
4. Birla Sun Life Insurance Company Limited (BSLICL)
5. ABNL Investment Limited (ABNLIL)
6. Madura Garments Lifestyle Retail Company Limited (MGLRCL)
7. Peter England Fashions and Retail Company Limited (PEFRL)
8. Indigold Trade and Services Limited (ITSL) (formerly known as
Madura Garments International Brand Company Limited) (on becoming
Associate, ceased to be an subsidiary w.e.f. 27th November, 2009 and
again become subsidiary w.e.f. 30th June, 2010)
8.1 LIL Investment Limited (LIL) (w.e.f. 27th July, 2009 and on
becoming Associate, ceased to be an subsidiary w.e.f. 27th November,
2009 and again became subsidiary w.e.f. 30th June, 2010)
9. Aditya Birla Minacs IT Services Limited (ABMITS) (formerly known as
PSI Data Systems Limited)
9.1 Aditya Birla Minacs Technologies Limited (ABMTL) (formerly known as
Birla Technologies Limited)
10. Shaktiman Mega Food Park Private Limited (w.e.f. 2nd December,
2010)
11. Madura Garments Exports Limited (MGEL) (merged with the Company
w.e.f. 1st January, 2010)
12. Madura Garments Exports US, Inc. (ceased to be a Subsidiary from
9th February, 2010)
13. MG Lifestyle Clothing Company Private Limited (MGCCPL) (merged
with the Company w.e.f. 1st January, 2010)
II. Joint Ventures:
1. Birla Sun Life Asset Management Company Limited (BSAMC) (Directly
held by the Company till 22nd March, 2010, thereafter Joint Venture of
ABFSPL)
2. Birla Sun Life Trustee Company Private Limited (BSTPL) (Directly
held by the Company till 22nd March, 2010 thereafter Joint Venture of
ABFSPL)
3. IDEA Cellular Limited
III. Associates:
1. Birla Securities Limited
2. Indigold Trade and Services Limited (formerly known as Madura
Garments International Brand Company Limited) (w.e.f. 27th November,
2009, upto 29th June, 2010)
3. LIL Investment Limited (w.e.f. 27th November, 2009, upto 29th June,
2010)
IV. Key Management Personnel:
1. Dr. Bharat K. Singh à Managing Director (Upto 30th June, 2009)
2. Mr. Adesh Gupta à Whole-time Director (Upto 30th April, 2009)
3. Mr. K.K. Maheshwari à Whole-time Director (Upto 20th May, 2010)
4. Dr. Rakesh Jain à Managing Director
5. Mr. Pranab Barua à Whole-time Director (w.e.f. 1st May, 2009)
V. Relatives of Key Management Personnel:
1. Mrs. Usha Gupta (Wife of Mr. Adesh Gupta)
2. Mrs. Sharda Maheshwari (Wife of Mr. K.K. Maheshwari)
Mar 31, 2010
Rs. Crore
Current Year Previous Year
1. Contingent Liabilities not provided for:
a) Claims against the Company not acknowledged as debts
i) Income-tax 82.52 84.66
ii) Custom Duty 0.23 1.11
iii) Excise Duty 29.06 28.03
iv) Sales Tax 85.72 70.66
v) Service Tax 1.04 1.01
vi) Others 35.05 54.13
b) Bills discounted with Banks 66.16 50.17
c) Corporate Guarantees given to Banks
for loans taken by subsidiaries 356.39 616.11
d) Corporate Guarantees given in
connection with performance obligation
of the subsidiaries 88.88 38.21
e) Customs Duty on capital goods and
raw materials imported under advance
licensing/EPCG scheme, against which
export obligation is to be fulfilled 42.96 11.34
f) Under the Jute Packaging Material (Compulsory use of Packing
Commodities) Act, 1987, a specified percentage of fertilisers
dispatched was required to be supplied in jute bags upto 31st August,
2001. The unit made conscious efforts to use jute packaging material as
required under the said Act. However, due to non- availability of
material as per the unit s product specifications as well as due to
strong customer resistance to use of jute bags, the specific percentage
could not be adhered to. The unit has received a show cause notice,
against which a writ petition has been filed with the Hon ble High
Court, which is awaiting for hearing. The Jute Commissioner, Kolkata
had filed transfer petition, various writ petitions has been filed in
different High Courts have by other aggrieved parties, including the
unit, before the Hon ble Supreme Court of India, praying for
consolidation of all cases at one Court. The transfer petition is
pending before the Hon ble Supreme Court. The unit has been advised
that the said levy is bad in law.
g) Idea Cellular Ltd. (Idea), in which the Company currently has the
largest shareholding, was originally a tripartite joint venture between
A.V Birla Group, Tata Group and AT&T Group. With the exit of AT&T and
the Tata Group, Idea is now part of A.V. Birla Group. Prior to its
exit, Tata Group had alleged that the A.V. Birla Group had committed
material breach of the Shareholders Agreements and the Tata Group
invoked the arbitration clause, pursuant to which an Arbitral Tribunal
has been constituted, which will be considering the claims of the Tata
Group and the counter-claims of the A.V. Birla Group.
The Company believes that it has a strong case to counter the
allegations of breach, and it does not contemplate any liability to
arise on this matter.
2. a) In accordance with approval of the shareholders in the
extra-ordinary general meeting of the Company held on June 17, 2009,
the Company has, on a preferential basis, issued 1.85 Crore Warrants of
Rs. 10/- each to the Promoter and/or Promoter Group at a price of Rs.
541.19. The holder of each Warrant is entitled to apply for and obtain
allotment of 1 Equity Share against each Warrant at any time after the
date of allotment but on or before the expiry of 18 months from the
allotment in one or more tranches. The Company has received an amount
of Rs. 250.30 Crore equivalent to 25% of the price and Rs. 324.71 Crore
(net of receipt of Rs. 108.23 Crore received on allotment of warrant)
on exercise of 80 Lacs Warrants of Rs. 10/- each by the Promoter Group.
Total amount of Rs. 575.01 Crore received from the preferential
allotment of the warrants has been fully utilised.
b) One of the Promoter Group, holding 1.88 Crore Warrants issued to it
on a preferential basis on February 21, 2008, had informed the Company
that it will not exercise the option of acquiring equity shares in
respect of the above Warrants. Consequently, Rs. 377.41 Crore paid by
the said Promoter Group Company, being 10% of the issue price, has been
forfeited and transferred to capital reserves. Also the option attached
to the aforesaid Warrants has been cancelled.
3. Pursuant to the Composite Scheme of Arrangement (the Scheme) under
Sections 391 to 394 of the Companies Act, 1956, between Aditya Birla
Nuvo Limited (the Company) and Madura Garments Exports Limited (MGEL),
MG Lifestyle Clothing Company Private Limited (MGCCPL) and Peter
England Fashions and Retail Limited (PEFRL), the wholly owned
subsidiaries of the Company, MGEL and MGCCPL have been merged with the
Company, and domestic garments business of PEFRL has demerged from
PEFRL and merged with the Company with effect from January 01, 2010
(the Appointed Date), pursuant to the Order passed by the Hon ble High
Court of Gujarat on January 28, 2010.
The effective date of the Scheme is February 22, 2010. MGEL was in the
business of contract exports, MGCCPL was in the business of
manufacturing of garments and PEFRL was in the business of retailing of
branded garments.
In terms of the Scheme, all assets and liabilities of MGEL, MGCCPL and
assets and liabilities of domestic garments business of PEFRL have been
transferred and stand vested with the Company with effect from the
Appointed Date at its respective book values on that date. MGEL, MGCCPL
and domestic garments business of PEFRL carried on all its businesses
and activities for the benefit of and in trust for, the Company from
the Appointed Date. Thus, the profit or income accruing or arising to
MGEL, MGCCPL and domestic garments business of PEFRL, or expenditure or
losses arising or incurred by it from the Appointed Date have been
treated as the profit or income or expenditure or loss, as the case may
be, of the Company. The Scheme has accordingly been given effect to in
these accounts.
A Amalgamation of MGEL and MGCCPL with the Company:
(i) The Company has accounted for the arrangement as amalgamation in
the nature of merger as prescribed by Accounting Standard 14 Ã
Accounting for Amalgamation (AS 14) issued by the Institute of
Chartered Accountants of India (ICAI). Accordingly, all the assets and
liabilities of MGEL and MGCCPL are recorded in the books of the Company
at their book values as on the Appointed Date.
4 a) Market/Book Values of certain long term quoted investments
aggregating to Rs. NIL (Previous Year: Rs. 453.10 Crore) and unquoted
investments aggregating to Rs. 2,311.47 Crore (Previous Year Rs.:
1,779.38 Crore) are lower than its cost.
Considering the strategic and long-term nature of the aforesaid
investments and asset base and business plan of the investee companies,
in the opinion of the management, the decline in the market/book value
of the aforesaid investments is of temporary nature, requiring no
provision.
An amount of Rs. 19.95 Crore is lying in Investment Reserve is to be
used to meet the diminution other than temporary, if any, that may
arise in future, in the value of present and future long term strategic
investments.
b) Transfer of investments in IDEA Cellular Ltd. (IDEA) and Birla Sun
Life Insurance Co. Ltd. is restricted by the terms contained in their
respective joint venture agreements. Non-disposal undertakings for
IDEA, Aditya Birla Minacs Worldwide Ltd. (ABMWL), Aditya Birla Minacs
IT Services Limited and Madura Garments Lifestyle Retail Company
Limited investment have also been provided to certain Banks for
respective credit facilities extended by them.
c) Pursuant to the Shareholders Agreement entered into with the Joint
Venture partner, the Company has in respect of Birla Sun Life Insurance
Company Limited agreed to infuse its share of capital from time to time
to meet the solvency requirement prescribed by the regulatory
authority.
5. Disclosure in respect of Related Parties pursuant to Accounting
Standard 18 Ã refer Annexure II
6. For Derivative Information - refer Annexure III
7. In September 2005, the Company had purchased 37.18 Crore equity
shares of IDEA Cellular Ltd. (IDEA) from M/s. AT&T Cellular Private.
Ltd, Mauritius, and paid consideration of US$ 150 Million without
deduction of tax at source after obtaining an order under Section
195(2) of the Income Tax Act from the Income Tax Department. The Deputy
Director of Income Tax (International Taxation), DDIT, Mumbai, has
issued order under Section 163(1) of the Income Tax Act dated March 25,
2009, treating the Company as an agent of New Cingular Wireless
Services Inc. for the sale of shares of IDEA by its subsidiary AT&T
Cellular Private Limited, Mauritius. The Company has challenged the
order of DDIT before the appropriate authority and, based on the
opinion of Tax Expert, the Company is reasonably certain that no tax
liability would devolve.
8. During the previous year, the Company has received fertilisers
bonds of Rs. 65.5 Crore from the Ministry of Fertilisers, the
Government of India, against the outstanding amount of subsidy
receivable, out of which bonds amounting to Rs. 29.33 Crore (Previous
Year: Rs. 37.45 Crore) are outstanding at the year end. The market
value of the above bonds are lower than the book value, therefore the
diminution in the value of above bonds amounting to Rs. 0.46 Crore
(Previous Year: Rs. 5.11 Crore) has been accounted under Miscellaneous
Expenses. The aforesaid bonds have been classified as ÃOther Current
Assetsà in the Financial Statements.
9. Other Interest include Interest on Income Tax Refund of Rs. 2.34
Crore (Previous Year: Rs. 4.57 Crore).
10. For additional information as required under paras 3, 4C and 4D of
Part II of Schedule VI to the Companies Act, 1956 - refer Annexure IV.
11. Segments have been identified in line with the Accounting Standard
on Segment Reporting (AS17), taking into account the organisational
structure as well as differential risk and returns of these segments.
Garments Branded Apparels and Accessories, Contract Exports
Rayon Yarn Viscose Filament Yarn, Caustic Soda and Allied Chemicals
Carbon Black Carbon Black
Insulator Insulators
Textiles Spun Yarn and Fabrics
Fertilisers Urea, Ammonia, Argon Gas, Pesticides and Seeds
Financial Services Corporate Finance, Syndication and Distribution
The Company considers secondary segment based on revenues within India
as Domestic Revenues and outside India as Export Revenues. Since assets
are used interchangeably, carrying amount of assets and cost incurred
during the year to acquire assets based on secondary segment have not
been disclosed. For Segment Information - refer Annexure V
12. Figures of Rs. 50,000 or less have been denoted by P
13. Previous year s figures have been regrouped/rearranged wherever
necessary.
a) List of Related Parties:
Parties where control exists à Subsidiaries:
Aditya Birla Financial Services Private Limited (ABFSPL) (w.e.f.
November 4, 2008)
Aditya Birla Capital Advisors Private Limited (ABCAPL) (Subsidiary of
ABFSPL) (w.e.f. November 4, 2008)
Aditya Birla Customers Services Private Limited (ABCSPL) (Subsidiary of
ABFSPL) (w.e.f. December 11, 2008)
Aditya Birla Securities Private Limited (ABSPL) (Subsidiary of ABFSPL)
(w.e.f. November 4, 2008, and ceased to be a Subsidiary w.e.f. March
13, 2009)
Aditya Birla Trustee Company Private Limited (ABTCPL) (Subsidiary of
ABFSPL) (w.e.f. November 28, 2008)
Aditya Birla Financial Shared Services Limited (ABFSSL) (Subsidiary of
ABFSPL) (w.e.f. June 19, 2008)
Aditya Birla Money Limited (ABML) (formerly known as Apollo Sindhoori
Capital Investments Limited) (Subsidiary of ABFSPL) (w.e.f. March 6,
2009)
Aditya Birla Commodities Broking Limited (ABCBL) (formerly known as
Apollo Sindhoori Commodities Trading Limited) (100% Subsidiary of ABML)
(w.e.f. March 6, 2009)
Birla Insurance Advisory & Broking Services Limited (50.01% Subsidiary
of ABFSPL)
Aditya Birla Money Mart Limited (ABMML) (formerly known as Birla Sun
Life Distribution Company Limited) (w.e.f. March 31, 2009)
Aditya Birla Money Insurance Advisory Services Limited (formerly known
as BSDL Insurance Advisory Services Limited) (100 % Subsidiary of
ABMML)
Aditya Birla Minacs Worldwide Limited (ABMWL)
Transworks Inc. (TW Inc.) (100% Subsidiary of ABMWL)
Aditya Birla Minacs Philippines Inc. (ABMPI) (100% Subsidiary of ABMWL)
AV Transworks Limited (AVTL) (100% Subsidiary of ABMWL)
Aditya Birla Minacs Worldwide Inc. (ABMWI) (100% Subsidiary of AVTL)
(formerly known as Minacs Worldwide Inc.)
Compass BPO Limited, U.K. (Subsidiary of ABMWI) (w.e.f. March 9, 2010)
Compass BPO, Inc., U.S.A (w.e.f. March 9, 2010)
Compass Business Process Outsourcing Private Limited, India (w.e.f.
March 9, 2010)
Compass BPO FZE, U.A.E. (w.e.f. March 9, 2010)
Minacs Worldwide SA de CV (100% Subsidiary of ABMWI)
Minacs Group (USA) Inc. (100% Subsidiary of ABMWI)
Minacs Limited (100% Subsidiary of ABMWI)
Minacs Worldwide GmbH (100% Subsidiary of Minacs Limited)
Minacs Kft. (100% Subsidiary of Minacs GmbH)
Aditya Vikram Global Trading House Limited (AVGTHL)
Aditya Birla Finance Limited (ABFL) (formerly known as Birla Global
Finance Company Limited)
Birla Sun Life Insurance Company Limited (BSLICL)
ABNL Investment Limited (ABCL) (formerly known as Laxminarayan
Investment Limited)
Madura Garments International Brand Company Limited (MGIBCL) (on
becoming Associate, ceased to be an Subsidiary w.e.f. November 27,
2009)
LIL Investment Limited (w.e.f. July 27, 2009, and on becoming
Associate, ceased to be a Subsidiary w.e.f. November 27, 2009)
Madura Garments Exports Limited (MGEL) (merged with the Company w.e.f.
January 1, 2010)
Madura Garments Exports US, Inc. (ceased to be a Subsidiary from
February 9, 2010) Madura Garments Lifestyle Retail Company Limited
(MGLRCL)
MG Lifestyle Clothing Company Private Limited (MGCCPL) (merged with the
Company w.e.f. January 1, 2010)
Peter England Fashions and Retail Limited (PEFRL)
Aditya Birla Minacs IT Services Limited (ABMITS) (formerly known as PSI
Data Systems Limited)
Birla Technologies Limited (100% Subsidiary of ABMITS)
Joint Ventures:
Birla Sun Life Asset Management Company Limited (BSAMC) (directly held
by the Company till March 22, 2010, thereafter Joint Venture of ABFSPL)
Birla Sun Life Trustee Company Private Limited (BSTPL) (directly held
by the Company till March 22, 2010, thereafter Joint Venture of ABFSPL)
Birla Sun Life Distribution Company Limited (BSDL) (on becoming
Subsidiary, ceased to be Joint Venture w.e.f. March 31, 2009)
IDEA Cellular Limited (31.78% upto August 12, 2008; 27.02% upto
February 28, 2010, and thereafter 25.38%)
Associates:
Birla Securities Limited
Madura Garments International Brand Company Limited (MGIBCL) (w.e.f.
November 27, 2009)
LIL Investment Limited (w.e.f. November 27, 2009)
Key Management Personnel and their relatives and enterprises having
common Key Management Personnel:
Dr. Bharat K. Singh à Managing Director (Upto 30th June, 2009)
Mr. Adesh Gupta à Whole-time Director (Upto 30th April, 2009)
Mr. K. K. Maheshwari à Whole-time Director
Dr. Rakesh Jain à Managing Director
Mr. Pranab Barua à Whole-time Director (w.e.f. 1st May, 2009)
Mr. Vikram Rao à Whole-time Director (Upto 31st January, 2009)
Relatives of Key Management Personnel:
Mrs. Usha Gupta (Wife of Mr. Adesh Gupta) (Upto 30th April, 2009)
Mrs. Sharda Maheshwari (Wife of Mr. K. K. Maheshwari)
Mrs. Vidya Rao (Wife of Mr. Vikram Rao) (Upto 31st January, 2009)
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