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Notes to Accounts of Can Fin Homes Ltd.

Mar 31, 2023

Further, the Company has issued Unsecured Debentures in the nature of Tier II capital worth H 10,000 lakhs in the financial year 201415 for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2023, 20% (As at March 31, 2022 40%) of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

16.1 As required under Section 125 of the Companies Act, 2013, the Company has transferred H 25.11 lakhs as unclaimed deposits including interest accrued thereon (As at March 31, 2022 H 32.47 lakhs), except to the extent of H 35.09 lakhs (As at March 31, 2022 H 39.70 lakhs) in respect of claims that are disputed deposits and H 8.23 lakhs ( As at March 31, 2022 H 33.09 lakhs) where claims are pending for non-completion of documentation by claimants. As of March 31, 2023, no amount was due for transfer to the IEPF.

16.2 As required under Section 125 of the Companies Act, 2013, the Company has transferred H 20.13 lakhs as unclaimed dividend to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2023. There are no dividends which are pending to be transferred to Investor Education and Protection Fund as per Sec 125 of the Companies Act, 2013 as at year end.

Note 19.3 Terms and rights attached to Equity Shares: The Company has one class of Equity shares having a face value of H 2/- per share and each shareholder is eligible for one vote per share held. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount in proportion to their shareholdings.

Note 19.4 For the period of five years immediately preceding the FY 2022-23

(A) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash is NIL

(B) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares is NIL

(C) Aggregate number and class of shares bought back is NIL Note 19.5 During the FY 2022-23 The Company has not :

A) Issued any securities convertible into equity/preference shares.

B) Issued any shares where calls are unpaid.

C) Forfeited any shares.

D) Issued any shares reseved for issue under options and contracts or commitments for sale of shares or disinvestment.

Note 20.1: As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible transfer u/s 29C of the NHB Act, 1987 also. Amount transfered during year ended March 31, 2022 includes H 3,319.38 lakhs of tax effect on special reserve.

The Company has transferred a sum of H 16,864.95 lakhs (As at March 31, 2022 H 13,188.88 lakhs) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and H 12,412.11 lakhs (As at March 31, 2022 H 9,404.48 lakhs ) to Additional Reserve u/s 29C of the NHB Act, 1987 during the FY 2022-23.

Note 20.2: The Company has paid final dividend of H 1.50 per share on the equity shares of face value of H 2/- each pertaining to FY 2021-22, post approval by the members in the 35th AGM held on 7th September, 2022. The Board of Directors had declared an interim dividend of H 1.50 per share for equity share of face value of H 2 each at their meeting held on November 28, 2022 and paid subsequently.

Note 20.3 : The Board of Directors, have recommended final dividend of H 2/- per equity share, this proposed dividend is subject to the approval of the members at the ensuing AGM. According to the requirements of Ind AS 10- Events occurring after Balance sheet date, the dividend declared shall only be recognised as a liability in the books of account in the year in which the dividends are declared on approval by members. The total estimated dividend on equity shares to be paid is H 2,663.31 lakhs.

Note 36: Contingent Liabilities and commitments (to the extent not provided for)

(i) Contingent Liabilities

(H in Lakhs) As at As at

Nature of claims Risk involved

March 31, 2023 March 31, 2022

Goods and Services Tax In respect of disputed Goods and Services Tax

liability not provided by the Company - FY 201718

2.30 -

Claims made by borrowers of the One case is pending before District Consumer company before various Consumer forum where compensation is sought against the Forums. Company.

0.50 0.50

The Management believes, based on the internal and professional advice, no material liabilities are expected, and hence no provision is made in the financial statements for the same

(ii) Commitments (not provided for)

Sanctioned Loans - Balance undrawn lines

1,40,804.96 1,33,351.52

Note 37 Employee Benefit Expenses

Defined Benefit Plans:

1. Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

2. Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a maximum of 240 days.

3. Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

4. Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

5. Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

Sensitivity Analysis

The sensitivity analysis presented below may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of reporting year, which is same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet

Note 40.1

In compliance with RBI notification number RBI/DNBS/2016-17/49/Master Direction DNBS. PPD.01/66.15.001/2016- 17 dated September 29, 2016, the Company has reported 26 cases of frauds amounting to H 285.83 lakhs (Previous Year - 38 Cases amounting to H 419.82 lakhs) to NHB during the current year.

During current year, Company has also reported one case of fraud committed by an employee amonting to H 4.63 lakhs in relation to siphoning of funds which was fully recovered.

Note 41 Financial Risk Management

i) Credit Risk

It is defined as the inability or unwillingness of the counterparty to meet the commitment in relation to lending, trading, hedging, settlement and other financial transactions. Also it is defined as the possibility of losses associated with diminution in the credit quality of borrowers or counter parties. The Credit policy articulates credit risk strategy to effectively communicate it throughout the company and all relevant personnel to understand company''s approach to grant of credit. The Policy covers products/ borrower category, frame work for appraisal process, guidelines for takeover of accounts, entry level matrix (credit scoring system) and flexibility in pricing, dispensation of credit, monitoring and review mechanism, limit structure/prudential exposure levels, reporting frame work. The Company has put in place a proper Loan Review Mechanism with responsibilities assigned in various areas such as, evaluating the effectiveness of loan administration, maintaining the integrity of credit grading process, assessing the loan loss provision, portfolio quality, etc. Credit grading involves assessment of credit quality, identification of problem loans, and assignment of risk ratings. Monitoring is being done through guidelines to branches; follow up by overseeing executives and other regular follow up.

As at balance sheet date, the Company does not have significant concentration of credit risk (Refer Note 46.10(ii)).

ECL Model and Assumptions considered in the ECL model

Markov chain model is used for estimating the probability of default on loans receivable. In a Markov chain model for loans receivable an account moves through different delinquency states each month. For example, an account in the "Regular" state this month will continue to be in the "Regular" state next month if a payment is made by the due date and will be in the "30 days past due" state if no payment is received during that month.

The transition matrix in the Markov chain represents the period-by-period movement of receivables between delinquency classifications or states. The transition evaluates loan quality or loan collection practice. The matrix elements are commonly referred to as "roll-rates" since they denote the probability that an account will move from one state to another in one period. The transition matrix is sometimes referred to as the "roll-rate matrix" or the "delinquency movement matrix".

The loan portfolio for the past several months are analysed to arrive at the transition matrix. Each loan identified by the Loan ID is traced to find out how the loan has performed over the last several months. The days past due is grouped into 6 states as follows: A. Regular [0 days past due] B. 1 to 30 days past due C. 31 to 60 days past due D. 61 to 90 days past due E. 91 to 120 days past due F. Above 120 days past due.

No significant increase in credit risk [Stage 1]: Based on Markov model, the monthly normalized transition matrix is converted into a 12-month transition matrix for determining the probability of default for those loan accounts on which the risk has not increased significantly from the time the debt is originated. We use the same criteria mentioned in the standard and assume that when the days past due exceeds ''30 days'', the risk of default has increased significantly. Therefore, for those loans for which the days past due is not more than 30 days, one-year default probability is considered. The probability of default is arrived at to determine the quantum of the loan that is likely to move into the states ''90 days past due'' and greater. After analysing the historical behaviour pattern of the days past due, we are of the opinion that probability of default should be arrived based on the sum of the matrix that is likely to move into the state ''60 days past due.

Note 41 Financial Risk Management (Contd..)

Significant increase in credit risk [Stage 2]: The credit risk is presumed to have increased significantly for loans that are more than 30 days past due and not more than 90 days past due. For such loans, lifetime default probability should be considered. Based on the maturity date of the loan, the probability of default is arrived at to determine the quantum of the loan that is likely to move into the states ''90 days past due'' and greater. After analysing the historical behaviour pattern of the days past due, we are of the opinion that probability of default should be arrived based on the sum of the matrix that is likely to move into the state ''60 days past due''. The respective transition matrix is used to find out the transition matrix applicable for the loan considering the maturity date of such loan likely to move into the states ''90 days past due'' and greater. After analysing the historical behaviour pattern of the days past due, we are of the opinion that probability of default should be arrived based on the sum of the matrix that is likely to move into the state ''60 days past due''. The respective transition matrix is used to find out the transition matrix applicable for the loan considering the maturity date of such loan.

Exposure at default

The exposure at default (EAD) represents the gross carrying amount of the financial instruments subject to the impairment calculation, addressing both the client''s ability to increase its exposure while approaching default and potential early repayments too.

Probabity of Default

Probability of default is the probability of whether borrowers will default on their obligations which are calculated based on historical default rate summary of past years.

Loss Given Default

LGD: The loans are secured by adequate property. The present value of such collateral property is considered while calculating the Expected Credit Loss. The Company initiates recovery process of Non Performing accounts within the statutory time limit as per SARFAESI and other applicable laws and accordingly the realizable period has been considered for computing the Realisable Present Value of Collateral.

ii) Financial Risk

The market risk is the possibility of loss to the Company prices of security due to changes in the market factors, mainly the changes in interest rates, and competition. It is the risk to the Company''s earnings and capital due to the changes in the market interest rates. Market Risk also includes company''s ability to meet its obligations as and when due. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The Company has an Investment Policy/ Borrowing Policy in place which addresses the Market Risk which defines safety and liquidity will have preference over returns. Our majority of investment is by way of Bank Deposits and Govt. securities for the purpose of maintenance of SLR as prescribed by NHB. All these deposits are held to maturity. There is an ALM Committee of Executives at RO (ALCO), which functions as the operational unit for managing the balance sheet and asset liability mismatches. All the borrowing decisions and raising short term funds in the form of Non Convertible Debentures, Commercial Papers, Securitization and such other modes, are taken at appropriate level as per the Board approved policy on borrowings. Refer Note 5.8 for Asset Liability Management.

Probability of loss arising from a situation where (1) there will not be enough cash and/or cash equivalents to meet the needs of depositors and borrowers, (2) sale of illiquid assets will yield less than their fair value, or (3) illiquid assets will not be sold at the desired time due to lack of buyers. ALM Policy is in place which has set prudential limits for structural liquidity and interest rate risk. The ALCO committee of the Company analyzes the ALM position of the Company as at the end of each quarter and appraises the Board the ALM position of the respective quarters along with the proposed measure to improve the ALM position.

Earnings risk is the danger that income may fluctuate due to changes in economic conditions or other factors. It is also the potential negative impact on the net interest income. The risk refers to vulnerability to movement in interest rates. Changes in interest rates effects earning, value of asset and cash flow. Asset Liability Management Committee (ALCO) meets at periodical intervals and assesses the earning risk and gives proper directions to the management to improve the NIM. Company shall monitor the income earned by way of interest and other income at quarterly intervals and place suitable notes to Board while placing notes on quarterly/half yearly/annual financial results of the Company. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The credit rating of our borrowings also have a significant impact on our net interest margin. Refer Note 46.4 for credit rating details.

Note 42: Capital Management

The Company''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Company monitors the return on capital as well as the level of dividends on its equity shares. The Company''s objective when managing capital is to maintain an optimal structure so as to maximize shareholder value.

The Board shall have the overall responsibility for management of liquidity risk. The Board shall decide the strategy, policies and procedures of the Company to manage liquidity risk in accordance with the liquidity risk tolerance/limits decided by it.

The Risk Management Committee, which reports to the Board and consisting of Chief Executive Officer (CEO)/ Managing Director, Chief Risk Officer (CRO) and heads of various verticals, shall be responsible for evaluating the overall risks faced by the Company including liquidity risk.

The ALCO, consisting of the Company''s top management shall be responsible for ensuring adherence to the risk tolerance/ limits set by the Board as well as implementing the liquidity risk management strategy of the Company. The role of the ALCO with respect to liquidity risk should include, inter alia, decision on desired maturity profile and mix of incremental assets and liabilities, sale of assets as a source of funding, the structure, responsibilities and controls for managing liquidity risk.

Note 43.1 Disclosure as per RBI/2019-20/88 DOR.NBFC (PD) CC. No.102/03.10.001/2019-20 Master Direction - Non-Banking Financial Company - Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016.

The Board shall have the overall responsibility for management of liquidity risk. The Board shall decide the strategy, policies and procedures of the Company to manage liquidity risk in accordance with the liquidity risk tolerance/limits decided by it.

The Risk Management Committee, which reports to the Board and consisting of Chief Executive Officer (CEO)/ Managing Director, Chief Risk Officer (CRO) and heads of various verticals, shall be responsible for evaluating the overall risks faced by the Company including liquidity risk.

The ALCO, consisting of the Company''s top management shall be responsible for ensuring adherence to the risk tolerance/ limits set by the Board as well as implementing the liquidity risk management strategy of the Company. The role of the ALCO with respect to liquidity risk should include, inter alia, decision on desired maturity profile and mix of incremental assets and liabilities, sale of assets as a source of funding, the structure, responsibilities and controls for managing liquidity risk.

F. Group Structure

Diagrammatic representation of group structure as follows:

Canara Bank (Sponsor Bank) —? Associate company —? Can Fin Homes Limited - 29.99%

G. Consolidated Financial Statements (CFS)

Indicative list of Balance Sheet Disclosure of HFCs Annex IV as per Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 para 4.10 is not applicable to the Comapany.

a) Interest on lease liabilities is H 296.66 Lakhs (Previous Year H 304.57 Lakhs) for the year ended on March 31, 2023.

b) The Company incurred H 213.37 Lakhs (Previous Year H 88.74 lakhs ) for the year ended 31 March 2023 towards expenses relating to other leases. The Company does not have any low value leases.

c) The total cash outflow for leases is H 951.67 Lakhs (Previous Year H 928.53 Lakhs) for the year ended March 31, 2023.

H. Disclosures of penalties imposed by NHB/RBI and other Regulators

During the financial year 2022-23 there were no penalties imposed by NHB/RBI or any other Regulator. (Previous Year - H 34,37,616)

G. Unsecured Advances

Unsecured Advances consists of loans H 794.92 lakhs (As at March 31, 2022 - H 544.30 lakhs)

Note 46.3 Registration obtained from other financial sector regulators during the year:

(i) Renewal of registration of the Company as LEI (Legal Entity Identifier) as required by RBI.

(ii) Registration of Company on TReDS (Trade Receivables Discounting System) platform trough RXIL (Receivables Exchange of India Limited) as required by MCA (Ministry of Corporate Affairs).

(iii) Registration of the Company as Business user for filing of returns in FIRMS (Foreign Investment Reporting and Management System).

(iv) Registration of Company as convergence partner with NCH (National Consumer Helpline) through software "INGRAM” as directed by NHB

Note 48 Corporate Social Responsibility (CSR)

The Company constituted a Corporate Social Responsibility (CSR) Committee of the Board as prescribed under Section 135 of the Companies Act 2013 and has put the CSR policy in place. The Company has focussed in Promoting education including special education for tribal students, Construction of class room blocks for Government schools, construction of girls Hostel, providing Stationeries and furniture''s to Government schools, setting up of Mini Science Labs (TINKER Labs), Vocational training, Skill enhancement programmes, renovation of Anganawadis, Scholarships for under privileged and girl child education, providing sanitation and drinking water facility. The Company also focuses on strengthening the healthcare by providing medical equipment and machineries, supported old age homes, orphanages and residential homes for differently abled people, animal welfare by construction of shelters, donated.

Veterinary equipment and machineries to carryout rescue, treatment and rehabilitation to injured animals, renewable energy sources by setting up solar power capacity at government schools and Solar Lighting systems to various villages, Conservation of Natural resources by Installing RO water purification, welfare measures, women empowerment and sports.

Note 49 Other Disclosures

i) There is no income which is required to be recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.

ii) The Company has not been declared willful defaulter by any Banks/Financial Institutions.

iii) The Company has not traded or invested in Crypto currency or Virtual currency during the year.

iv) There are no proceedings which have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.

v) There are no transaction with struck off companies during the current and previous year.

vi) The Code on Social Security 2020 (""the Code"") relating employee benefits, during the employment and post employment, has received presidnetial assent on September 28, 2020. The Code has been published in the Gazette of India. Further, the Ministry of Labour and Employment has released draft rules for the Code on November 13, 2020. However, the effective date from which the changes are applicable is yet to be notified and rules for quanitifying the financial impact are yet to be issued. The Company will assess the impact of the Code and will give appropriate impact in the financial statements in the period in which the Code becomes effective and the related rules to determine the financial impact are published.

vii) No funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person(s) or entity(ies), including foreign entities ("Intermediaries”) with the understanding, whether recorded in writing or otherwise, that the Intermediary shall lend or invest in party identified by or on behalf of the Company (Ultimate Beneficiaries). The Company has not received any fund from any party(s) (Funding Party) with the understanding that the Company shall whether, directly or indirectly lend or invest in other persons or entities identified by or on behalf of the Company ("Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Note 49.1: Previous years figures have been re-arranged/ regrouped wherever necessary to correspond with the current year''s classification/disclosure


Mar 31, 2022

Note 5.1 Loans outstanding is net of processing fee which is recognised as interest income using EIR method.

Note 5.2 Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Registered mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Personal Guarantees and/or

(d) Undertaking to create a security or perfection security

(e) Vehicles Loan given to employees are secured by hypothecation of vehicles Note 5.3

The Company has acquired certain assets under SARFAESI Act which are retained for the purpose of sale under the rules and regulations of SARFAESI Act involving market value of C 2,963.79 lakhs (Previous Year C 2,734.79 lakhs), which are part of NPA portfolio aggregating to C 2,134.75 lakhs (Previous Year C 1,738.04 lakhs) for which necessary provisions have already been made. These assets are accounted as and when they are realised.

Note 5.6:

(i) The above asset classification and provisioning held are as per the Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 as on March 31, 2022.

(ii) Provision for Non-performing assets required to be maintained as per Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 is to the extent of C 8,987.61 lakhs (Previous year C 6,758.21 lakhs). The company, has made provision for the same. The Company holds 52.69% (Previous Year 33.47 %) provision against the Non-Performing Assets.

(iii) In respect of personal loans where a resolution plan is implemented under this facility, the Company hold provision of C 6,768.84 lakhs (PY C 765.81 lakhs for Resolution Framework 1.0 ) provision requirements under Resolution Framework 1.0 and 2.0 for COVID-19-related Stress as per RBI circular dated August 6, 2020 and May 5, 2021 respectively.

5.7 All housing finance companies are required to carry a general provision (i) at the rate of 1% of Standard Assets in respect of Commercial Real Estates other than Residential Housing, (ii) at the rate of 0.75% of Standard Assets in respect of Commercial Real Estate - Residential Housing and (iii) at the rate of 0.25%individual housing loans which are Standard Assets other than (i) and (ii) above and 0.40% on all non housing loans. Loans to individuals for 3rd dwelling units onwards shall be treated as Commercial Real Estate (CRE) exposure. The Company carries a cumulative provision of C9,783.14 lakhs (Previous Year C 7,837.30 lakhs).

Note 6.2

The above investments (investment SI No. 1 to 7 ) are made to comply with the Statutory Liquidity Assets to be maintained under NHB/ Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Direction, 2021. These carry a floating charge created in favour of trustees of depositors. The total investments under Statutory Liquidity Assets include C 4955.26 lakhs (Previous Year C 4,960.39 lakhs) [valued at amortised cost] in Government securities and C 1,917.55 lakhs (Previous Year C 1,889.67 lakhs) in deposits with Nationalised Bank.

11.1 Trade payables include C Nil (Previous Year C Nil) payable to "Suppliers” registered under The Micro, Small & Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the "suppliers” covered under The Micro, Small & Medium Enterprises Development Act, 2006. The above information takes into account only those suppliers who have responded to enquiries made by the company for this purpose.

12.2 Nature of security and terms of repayment

Secured by first and exclusive floating charge on specified assets by hypothecation of book debts and loan receivables. Interest will be paid annually and principal amount will be paid on maturity.

[1] Borrowings from Banks which are also related parties are shown separately under Loan from related parties in Sl No. (b ) above

[2] Includes borrowings outstanding aggregating to C 5,38,249.59 lakhs (Previous Year C 3,95,494.08 lakhs) from National Housing Bank.

13.1 Secured loans includes borrowings from National Housing Bank, Canara Bank, HDFC Bank, and State Bank of India etc., are secured by way of specific charge on book debts, outstanding, receivables, etc., of the Company. The tenure of the Long term borrowings are more than one year and upto 15 years and that of short term borrowings is less than 1 year.

13.2 There is no amount of continuing default as on the Balance Sheet date in terms of repayment of loans & interest on Borrowings of the Company.

13.3 There is no pending charges or satisfaction yet to be registered with ROC within the statutory period as on March 31, 2022.

14.1 As per the directions of the National Housing Bank, the Company has created floating charge on Statutory Liquid Assets (Investments in Govt. Securities (including other approved securities) and Deposits in Commercial Banks) in favour of the Trustees of the depositors in terms of Paragraph 42.2 of the Master Direction - Non-Banking Financial Company - Housing Finance Company (Reserve Bank) Directions, 2021 read with by the National Housing Bank in terms of sub-sections (1) & (2) of section 29B of the NHB Act, 1987 [ Refer Note 3.1 and 6.1].

14.2 The Company has not received any money from the Directors during the current financial year and previous financial year.

14.3 Also refer note no. 16.1 of financial statement.

Further, the Company has issued Unsecured Debentures in the nature of Tier II capital worth H 10,000 lakhs in the financial year 201415 for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2022, 40% of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

Temporary Book Overdraft of C 12,456.42 lakhs (Previous Year C Nil) represents cheques issued towards disbursements to borrowers but not encashed as at March 31, 2022

16.1 As required under Section 125 of the Companies Act, 2013, the Company has transferred ? 32.47 lakhs as unclaimed deposits including interest accrued thereon (Previous Year ? 16.94 lakhs), except to the extent of ? 39.70 lakhs (PY ? 41.16 lakhs) in respect of claims that are disputed deposits and ? 33.09 lakhs ( PY ? 25.56 lakhs) where claims are pending for non-completion of documentation by claimants. As of March 31, 2022, no amount was due for transfer to the IEPF.

16.2 As required under Section 125 of the Companies Act, 2013, the Company has transferred ? 19.67 lakhs as unclaimed dividend to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2022. There are no dividends which are pending to be transferred to Investor Education and Protection Fund as per Sec 125 of the Companies Act, 2013 as at year end.

17.1 Provision has been made for the balance amount receivable under Scheme for grant of ex-gratia RBI/2020-21/61 DOR.No.BP. BC.26/21.04.048/2020-21, payment of difference between compound interest and simple interest for six months to borrowers in specified loan accounts (1.3.2020 to 31.8.2020).

Note 20.1: As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible transfer u/s 29C of the NHB Act, 1987 also. The Company has transferred a sum of C 13,188.88 lakhs (Previous Year C 12,054.62 lakhs) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and C 9,404.48 lakhs (Previous Year C 9,120.62 lakhs ) to Additional Reserve u/s 29C of the NHB Act, 1987 during the FY 2021-22.

Note 20.2: The Company has paid dividend of H 2/- per share on the equity shares of face value of H 2/- each pertaining to FY 202021, post approval by the members in the 34th AGM held on 8th September, 2021. The Board of Directors had declared an interim dividend of C 1.50 per share for equity share of face value of C 2 each at their meeting held on December 14, 2021 and paid subsequently.

Note 20.3 : The Board of Directors, have recommended final dividend of H 1.5/- per equity share, this proposed dividend is subject to the approval of the members at the ensuing AGM. According to the requirements of Ind AS 10- Events occurring after Balance sheet date, the dividend declared shall only be recognised as a liability in the books of account in the year in which the dividends are declared on approval by members. The total estimated dividend on equity shares to be paid is C 1,997.31 lakhs.

29.2 The Company has entered into lease cum licence agreement with M/S ThemePro Technologies Pvt Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to C 389.97 lakhs (Previous Year C 297.24 lakhs) is charged to the P & L account under Legal and Professional charges.

(i) Contingent Liabilities (to the extent not provided for) Nature of claims Risk involved

As at

March 31, 2022

(H in Lakhs) As at

March 31, 2021

Claims made by borrowers of the One case is pending before District Consumer company before various Consumer forum where compensation is sought against the Forums. Company

0.50

There are two(2) cases in Consumer Forums, out of which one case is pending before State Consumer redressal Forum and one case is pending before High Court where compensation is sought against the Company.

8.46

Based on the professional advice no material liabilities are expected, and hence no provision is made in the financial statements for the same.

(ii) Commitments (not provided for)

Disbursements - Undrawn lines

133,351.52

117,410.21

Note 37 Employee Benefit Expenses

Defined Benefit Plans:

1. Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

2. Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a maximum of 240 days.

3. Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

4. Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

5. Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

Sensitivity Analysis

The sensitivity analysis presented below may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of reporting year, which is same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet.

Note 40.1

In compliance with RBI notification number RBI/DNBS/2016-17/49/Master Direction DNBS. PPD.01/66.15.001/2016- 17 dated September 29, 2016, during the year and subsequent to end of the year the Company has reported 38 fraud case in relation to loans advanced to the borrowers amounting to C 419.82 lakhs to NHB (Previous year C Nil).

Note 41 Financial Risk Management

i) Credit Risk

It is defined as the inability or unwillingness of the counterparty to meet the commitment in relation to lending, trading, hedging, settlement and other financial transactions. Also it is defined as the possibility of losses associated with diminution in the credit quality of borrowers or counter parties. The Credit policy articulates credit risk strategy to effectively communicate it throughout the company and all relevant personnel to understand company''s approach to grant of credit. The Policy covers products/ borrower category, frame work for appraisal process, guidelines for takeover of accounts, entry level matrix (credit scoring system) and flexibility in pricing, dispensation of credit, monitoring and review mechanism, limit structure/prudential exposure levels, reporting frame work. The Company has put in place a proper Loan Review Mechanism with responsibilities assigned in various areas such as, evaluating the effectiveness of loan administration, maintaining the integrity of credit grading process, assessing the loan loss provision, portfolio quality, etc. Credit grading involves assessment of credit quality, identification of problem loans, and assignment of risk ratings. Monitoring is being done through guidelines to branches; follow up by overseeing executives and other regular follow up.

As at balance sheet date, the Company does not have significant concentration of credit risk (Refer Note 46.10(ii)).

The market risk is the possibility of loss to the Company prices of security due to changes in the market factors, mainly the changes in interest rates, and competition. It is the risk to the Company''s earnings and capital due to the changes in the market interest rates. Market Risk also includes company''s ability to meet its obligations as and when due. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The Company has an Investment Policy/ Borrowing Policy in place which addresses the Market Risk which defines safety and liquidity will have preference over returns. Our majority of investment is by way of Bank Deposits and Govt. securities for the purpose of maintenance of SLR as prescribed by NHB. All these deposits are held to maturity. There is an ALM Committee of Executives at RO (ALCO), which functions as the operational unit for managing the balance sheet and asset liability mismatches. All the borrowing decisions and raising short term funds in the form of Non Convertible Debentures, Commercial Papers, Securitization and such other modes, are taken at appropriate level as per the Board approved policy on borrowings. Refer Note 5.8 for Asset Liability Management.

Probability of loss arising from a situation where (1) there will not be enough cash and/or cash equivalents to meet the needs of depositors and borrowers, (2) sale of illiquid assets will yield less than their fair value, or (3) illiquid assets will not be sold at the desired time due to lack of buyers. ALM Policy is in place which has set prudential limits for structural liquidity and interest rate risk. The ALCO committee of the Company analyzes the ALM position of the Company as at the end of each quarter and appraises the Board the ALM position of the respective quarters along with the proposed measure to improve the ALM position.

Earnings risk is the danger that income may fluctuate due to changes in economic conditions or other factors. It is also the potential negative impact on the net interest income. The risk refers to vulnerability to movement in interest rates. Changes in interest rates effects earning, value of asset and cash flow. Asset Liability Management Committee (ALCO) meets at periodical intervals and assesses the earning risk and gives proper directions to the management to improve the NIM. Company shall monitor the income earned by way of interest and other income at quarterly intervals and place suitable notes to Board while placing notes on quarterly/ half yearly/annual financial results of the Company. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The credit rating of our borrowings also have a significant impact on our net interest margin. Refer Note 46.4 for credit rating details.

Note 42: Capital Management

The Company''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Company monitors the return on capital as well as the level of dividends on its equity shares. The Company''s objective when managing capital is to maintain an optimal structure so as to maximize shareholder value.

vi) Institutional set-up for liquidity risk management

The Board shall have the overall responsibility for management of liquidity risk. The Board shall decide the strategy, policies and procedures of the Company to manage liquidity risk in accordance with the liquidity risk tolerance/limits decided by it.

The Risk Management Committee, which reports to the Board and consisting of Chief Executive Officer (CEO)/ Managing Director, Chief Risk Officer (CRO) and heads of various verticals, shall be responsible for evaluating the overall risks faced by the Company including liquidity risk.

The ALCO, consisting of the Company''s top management shall be responsible for ensuring adherence to the risk tolerance/ limits set by the Board as well as implementing the liquidity risk management strategy of the Company. The role of the ALCO with respect to liquidity risk should include, inter alia, decision on desired maturity profile and mix of incremental assets and liabilities, sale of assets as a source of funding, the structure, responsibilities and controls for managing liquidity risk.

a) Interest on lease liabilities is C 304.57 Lakhs (Previous Year C 296.48 Lakhs) for the year ended on March 31, 2022.

b) The Company incurred C 88.74 Lakhs (Previous Year C 26.68 lakhs ) for the year ended 31 March 2022 towards expenses relating to short term leases. The Company does not have any low value leases.

c) The total cash outflow for leases is C 928.53 Lakhs (Previous Year C 921.88 Lakhs) for the year ended March 31, 2022

d) The Company has applied the practical expedient to all rent concessions that meet the conditions in paragraph 46B.

e) Profit recognised for the reporting period of C 1.31 lakhs (Previous Year C 21.77 lakhs) to reflect changes in lease payments that arise from rent concessions to which the lessee has applied the practical expedient in paragraph 46A.

F. Disclosures of penalties imposed by NHB/RBI and other Regulators

The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010 except for one instance detailed below

NHB vide its NHB (ND)/HFC/DoS/Sup/OUT02755/2021 dated June 11, 2021 has imposed a penalty of C 34,37,616/-(inclusive of GST@18%) on account of acceptance or renewal of public deposit for a period of less than 12 months which is in contravention of the provisions of Para 4 of the MFCs (NHB) Directions, 2010 and paid by the Company.

G. Unsecured Advances

Unsecured Advances consists of loans C 544.30 lakhs (Previous Year C 429.53 lakhs)

(i) Renewal of registration of the Company as LEI (Legal Entity Identifier) as required by RBI.

(ii) Registration of Company on TReDS (Trade Receivables Discounting System) platform trough RXIL (Receivables Exchange of India Limited) as required by MCA (Ministry of Corporate Affairs).

(iii) Registration of the Company as Business user for filing of returns in FIRMS (Foreign Investment Reporting and Management System).

(iv) Registration of Company as convergence partner with NCH (National Consumer Helpline) through software "INGRAM” as directed by NHB

47.1 General provision required to be maintained in respect of accounts in default but standard and asset classification benefit extended, as per RBI Circular on ''COVID-19 Regulatory Package dated 17th April'' 2020. Against this, the Company continous to holds a provision of H 6,984.05 lakhs, on account of COVID - 19 Stress. This provision amount is disclosed as Special Provisioning for RBI regulatory package under Note 17: "Provisions”

47.2 Consequent to the outbreak of the COVID-19 pandemic, the Indian government announced a lockdown in April-May 2020. Subsequently, the national lockdown was lifted by the government, but regional lockdowns continue to be implemented in areas with significant number of COVID-19 cases. India experienced the "second wave” of COVID -19 pandemic in April-May 2021 and has resulted in re-imposition of localised lockdowns in various parts of the Country. These were gradually lifted as the second wave subsided. The world is now experiencing another outbreak on account of new coronavirus variant and as a precautionary measure India has started to reimpose localised / regional restrictions.

The impact on the Company''s operations and financial position, including the credit quality and requirement for provisioning, is uncertain and will depend on future steps taken by the Government/Reserve Bank of India till such time that the economic activities return to normalcy, which is highly unpredictable. The Company will continue to closely monitor any material changes to the future economic/regulatory conditions. However, operating substantially in asset mortgage business, which is relatively stable asset class, no major impact is anticipated at this juncture.

Note 48 Corporate Social Responsibility (CSR)

The Company constituted a Corporate Social Responsibility (CSR) Committee of the Board as prescribed under Section 135 of the Companies Act 2013 and has put the CSR policy in place. The Company has focussed in promoting education including special education, setting up hostels for tribal children, Construction of class room blocks for schools, Scholarships for under privileged ,renovation of schools and anganawadis, Sponsorship of child education. The Company also focuses on healthcare by donating advanced medical equipment''s to various hospitals. To promote eradicating hunger, Company has contributed for mid day meals at schools through Akshaya Patra Foundation. The company donated Relief materials to Cyclone and Flood affected areas. To promote Environmental Sustainability, donation of tree saplings, Contribution towards "Cauvery Calling”, a campaign to revitalize the southern Indian river Cauvery by planting trees in the river basin was undertaken. Contribution to Prime Minister''s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES),Karnataka State Disaster management Authority, CM Relief Fund, Karnataka during COVID-19 pandemic, also forms part of its CSR activities.

The activities undertaken by the Company under CSR is Pan India basis and the projects are executed by Registered Office and our branches in those areas. The total amount/ budget under CSR for the FY 2021-22 was C 1,070.00 lakhs and undisbursed amount of Preceding years is C 173.37 lakhs. The total amount spent under the CSR activities in FY 2021-22 is C 825.51 lakhs (Including C 166.19 lakhs- of preceding years). The balance amount of C 410.68 lakhs which is already sanctioned in the FY 2021-22 will be transferred to unspent CSR account as per provisions of Companies Act and will be disbursed as per the progress of the work. The summary of CSR details as on March 31, 2022 is given below:

Previous years figures have been re-arranged/ regrouped wherever necessary to correspond with the current year''s classification/ disclosure


Mar 31, 2021

Note 5.5:

(i) The above asset classification and provisioning held are as per the Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 as on March 31, 2021.

(ii) Provision for Non-performing assets required to be maintained as per Non-Banking Financial Company-Housing Finance Company (Reserve Bank) Directions, 2021 is to the extent of ? 6,758.21 lakhs (Previous year ? 4,530.79 lakhs). The company, has made provision for the same.

The Company holds 33.47% (Previous Year 28.83 %) provision against the Non-Performing Assets.

(iii) General provision required to be maintained in respect of accounts in default but standard and asset classification benefit extended, as per RBI Circular on ''COVID-19 Regulatory Package dated 17th April'' 2020. Against this, the Company continous to holds a provision of H 6,984.05 lakhs, on account of COVID - 19 Stress. This provision amount is disclosed as Special Provisioning for RBI regulatory package under Note 17: "Provisions" (also refer Note 46).

(iv) In respect of personal loans where a resolution plan is implemented under this facility, the Company created provision of H 765.81 provision requirements under Resolution Framework for COVID-19-related Stress as per RBI circular dated August 6, 2020.

5.6 All housing finance companies are required to carry a general provision (i) at the rate of 1% of Standard Assets in respect of Commercial Real Estates other than Residential Housing, (ii) at the rate of 0.75% of Standard Assets in respect of Commercial Real Estate - Residential Housing and (iii) at the rate of 0.25%individual housing loans which are Standard Assets other than (i) and (ii) above. Loans to individuals for 3rd dwelling units onwards shall be treated as Commercial Real Estate (CRE) exposure. The Company carries a cumulative provision of ? 7,837.29 lakhs (Previous Year: 7,306.96 lakhs).

19.3 Terms and rights attached to Equity Shares: The Company has one class of Equity shares having a face value of H 2/- per share and each shareholder is eligible for one vote per share held. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount in proportion to their shareholdings.

19.4 For the period of five years immediately preceding the FY 2020-21

(A) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash is NIL

(B) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares is NIL

(C) Aggregate number and class of shares bought back is NIL

19.5 The Company has not :

A) Issued any securities convertible into equity/preference shares.

B) Issued any shares where calls are unpaid.

C) Forfeited any shares.

D) Issued any shares reseved for issue under options and contracts or commitments for sale of shares or divestment.

20.1 As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible transfer u/s 29C of the NHB Act, 1987 also. The Company has transferred a sum of H12,054.62 lakhs (Previous Year H11,682.55 lakhs) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and H9,120.62 lakhs (Previous Year H 7,488.26 lakhs ) to Additional Reserve u/s 29C of the NHB Act, 1987 during the FY 2020-21.

20.2 The Company has paid dividend of H 2/- per share on the equity shares of face value of H 2/- each pertaining to FY 2019-20, post approval by the members in the 33rd AGM held on 26th August, 2020.

20.3The Board of Directors, have recommended final dividend of H2/- per equity share, this dividend will be paid after the approval of the members at the ensuing AGM. According to the requirements of Ind AS 10- Events occurring after Balance sheet date, the dividend declared and tax thereon shall only be recognised as a liability in the books of account in the year in which the dividends are declared on approval by members. The total estimated dividend on equity shares to be paid is H2,663.08 lakhs.

i) Credit Risk

It is defined as the inability or unwillingness of the counterparty to meet the commitment in relation to lending, trading, hedging, settlement and other financial transactions. Also it is defined as the possibility of losses associated with diminution in the credit quality of borrowers or counter parties. The Credit policy articulates credit risk strategy to effectively communicate it throughout the company and all relevant personnel to understand company''s approach to grant of credit. The Policy covers products/borrower category, frame work for appraisal process, guidelines for takeover of accounts, entry level matrix (credit scoring system) and flexibility in pricing, dispensation of credit, monitoring and review mechanism, limit structure/prudential exposure levels, reporting frame work. The Company has put in place a proper Loan Review Mechanism with responsibilities assigned in various areas such as, evaluating the effectiveness of loan administration, maintaining the integrity of credit grading process, assessing the loan loss provision, portfolio quality, etc. Credit grading involves assessment of credit quality, identification of problem loans, and assignment of risk ratings. Monitoring is being done through guidelines to branches; follow up by overseeing executives and other regular follow up.

ii) Financial Risk

The market risk is the possibility of loss to the Company prices of security due to changes in the market factors, mainly the changes in interest rates, and competition. It is the risk to the Company''s earnings and capital due to the changes in the market interest rates. Market Risk also includes company''s ability to meet its obligations as and when due. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The Company has an Investment Policy/ Borrowing Policy in place which addresses the Market Risk which defines safety and liquidity will have preference over returns. Our majority of investment is by way of Bank Deposits and Govt. securities for the purpose of maintenance of SLR as prescribed by NHB. All these deposits are held to maturity. There is an ALM Committee of Executives at RO (ALCO), which functions as the operational unit for managing the balance sheet and asset liability mismatches. All the borrowing decisions and raising short term funds in the form of Non Convertible Debentures, Commercial Papers, Securitization and such other modes, are taken at appropriate level as per the Board approved policy on borrowings. Refer Note 5.7 for Asset Liability Management.

iii) Liquidity Risk

Probability of loss arising from a situation where (1) there will not be enough cash and/or cash equivalents to meet the needs of depositors and borrowers, (2) sale of illiquid assets will yield less than their fair value, or (3) illiquid assets will not be sold at the desired time due to lack of buyers. ALM Policy is in place which has set prudential limits for structural liquidity and interest rate risk. The ALCO committee of the Company analyzes the ALM position of the Company as at the end of each quarter and appraises the Board the ALM position of the respective quarters along with the proposed measure to improve the ALM position.

iv) Interest rate risk

Earnings risk is the danger that income may fluctuate due to changes in economic conditions or other factors. It is also the potential negative impact on the net interest income. The risk refers to vulnerability to movement in interest rates. Changes in interest rates effects earning, value of asset and cash flow. Asset Liability Management Committee (ALCO) meets at periodical intervals and assesses the earning risk and gives proper directions to the management to improve the NIM. Company shall monitor the income earned by way of interest and other income at quarterly intervals and place suitable notes to Board while placing notes on quarterly/half yearly/annual financial results of the Company. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The credit rating of our borrowings also have a significant impact on our net interest margin. Refer Note 43.4 for credit rating details.

1. As defined in Paragraph 4.1.30 of these Directions.

2. Provisioning norms shall be applicable as prescribed in these Directions.

3. All notified Accounting Standards are applicable including for valuation of investments and other assets as also assets acquired in satisfaction of debt. However, market value in respect of quoted investments and break up / fair value / NAV in respect of unquoted investments shall be disclosed irrespective of whether they are classified as long term or current in (5) above.

a) Impact on transition to Ind AS 116

During the previous year, the Company has adopted Ind AS 116 "Leases", with effect from April 1, 2019 and applied to all lease contracts existing on April 1, 2019 using the modified retrospective method and has taken the cumulative adjustment to retained earnings as per the guidelines provided in Paragraph C7 and Paragraph C8 c(i) of Ind AS 116, on the date of initial application.Accordingly, comparatives for the year ended March 31, 2019 has not been retrospectively adjusted.

On transition to Ind AS 116, the Company recognised Right-of- use assets and lease liabilities, after difference being set off against existing rent eqalisation reserve as on 1st April, 2019. The cumulative effect of applying the standard, amounting to ? 382.80 lakhs was debited to retained earnings, net of taxes.

F. Disclosures of penalties imposed by NHB/RBI and other Regulators

The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010 except for one instance detailed below

NHB vide its letter NHB (ND)/DRS/SUP/6742/2020 dated October 15, 2020 has imposed a penalty of H5,900 (inclusive of GST@18%) on account of non compliance with respect to the provision of policy circular no 21 issued by NHB which is paid under protest by the Company.

G. Unsecured Advances

Unsecured Advances consists of loans granted to Staff H156.62 lakhs (Previous Year H165.62 lakhs)

45.3 Registration obtained from other financial sector regulators during the year:

(i) Renewal of registration of the Company as LEI (Legal Entity Identifier) as required by RBI.

(ii) Registration of Company on TReDS (Trade Receivables Discounting System) platform trough RXIL (Receivables Exchange of India Limited) as required by MCA (Ministry of Corporate Affairs).

(iii) Registration of the Company as Business user for filing of returns in FIRMS (Foreign Investment Reporting and Management System).

(iv) Registration of Company as convergence partner with NCH (National Consumer Helpline) through software "INGRAM" as directed by NHB

Note 46: COVID19 Regulatory Package - Asset Classification and Provisioning

Consequent to the outbreak of the COVID-19 pandemic, the Indian government announced a lockdown in March 2020. Subsequently, the national lockdown was lifted by the government, but regional lockdowns continue to be implemented in areas with significant number of COVID-19 cases. Subsequently India has entered the second wave of the pandemic where the number of COVID cases have increased significantly and has resulted in re-imposition of localised lockdowns in various parts of the Country. The impact on the Company''s operations and financial position, including the credit quality and requirement for provisioning, is uncertain and will depend on future steps taken by the Government/Reserve Bank of India till such time that the economic activities return to normalcy, which is highly unpredictable. The Company will continue to closely monitor any material changes to the future economic/regulatory conditions. However, operating substantially in asset mortgage business, which is relatively stable asset class, no major impact is anticipated at this juncture.

The RBI on March 27, 2020, April 17, 2020, May 6, 2020 and May 23, 2020 announced ''COVID-19 Regulatory Package'' on asset classification and provisioning. In terms of the guidelines given in the aforesaid RBI circulars, the company has offered a moratorium option to its borrowers whose accounts are standard as on February 29, 2020, from payments of instalments falling due between March 01, 2020 to August 31, 2020. As such, in respect of all accounts classified as standard as on February 29, 2020, even if overdue, the moratorium period, wherever granted, has been excluded from the number of days past-due for the purpose of asset classification under Regulatory Income Recognition and Asset Classification norms (IRAC) as of March 31, 2021.

As on March 31,2021, Company holds a provision of H 6,984.05 lakhs, after adjusting against the actual provisioning requirements for slippages from the accounts reckoned for such provisions and utilised for meeting the provision requirements under Resolution Framework for COVID-19-related Stress as per RBI circular dated August 6, 2020.

The Company constituted a Corporate Social Responsibility (CSR) Committee of the Board as prescribed under Section 135 of the Companies Act 2013 and has put the CSR policy in place. The Company has focussed in promoting education including special education .setting up hostels for tribal children, Construction of class room blocks for schools, Scholarships for under privileged ,renovation of schools and anganawadis, Sponsorship of child education. The Company also focuses on healthcare by donating advanced medical equipment''s to various hospitals. To promote eradicating hunger, Company has contributed for mid day meals at schools through Akshaya Patra Foundation. The company donated Relief materials to Cyclone and Flood affected areas. To promote Environmental Sustainability, donation of tree saplings, Contribution towards "Cauvery Calling", a campaign to revitalize the southern Indian river Cauvery by planting trees in the river basin was undertaken. Contribution to Prime Minister''s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES),Karnataka State Disaster management Authority, CM Relief Fund, Karnataka during COVID-19 pandemic, also forms part of its CSR activities.

The activities undertaken by the Company under CSR is Pan India basis and the projects are executed by Registered Office and our branches in those areas. The total amount/ budget under CSR for the FY 2020-21 was H1,281.00 lakhs, (including previous year H317 lakhs), out of which, total amount spent under the CSR activities is H1,107.58 lakhs. The balance amount of H173 Lakhs is already sanctioned and will be transferred to Unspent CSR Account as per provisions of Companies Act and will be disbursed as per the progress of the work.A summary of CSR details as on March 31, 2021 is given below.

Note 49: Previous years figures have been re-arranged/ regrouped wherever necessary to correspond with the current year''s classification/disclosure


Mar 31, 2019

1. Company Overview

Can Fin Homes Ltd (The Company)., set up under the sponsorship of Canara Bank, was incorporated in the year 1987, The Company is a housing finance institution approved by National Housing Bank (NHB), the apex authority of housing in the country. It is a listed company and its shares are traded in all the major stock exchanges in the country. The company has its head office in Bengaluru, Karnataka.

Note 2.1 Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Bank guarantees, company guarantees or personal Guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

The Company has acquired certain assets under SARFAESI Act which are retained forthe purpose of sale under the rules and regulations of SARFAESI Act involving market value of Rs.1,123.88 (PY 2017-18: Rs.667.62 lakhs), which are part of NPA portfolio aggregating to ?810.94(PY 2017-18: ?559.68 lakhs) for which necessary provisions have already been made. These assets are accounted as and when they are realised.

(i) The above classification of loans and provisions to be held are as per the guidelines on prudential norms issued by NHB as on March 31, 2019.

(ii) Provision of Non-performing assets is required to be maintained as per NHB guidelines on prudential norms to the extent of H3,334.10 lakhs (Previous year RS.1,773.01 lakhs) against which the company, by way of prudence and abundant caution has maintained cumulative provision of H3,404.62 lakhs (Previous year H3586.83 lakhs). The Management has provided an additional provision of RS.69.22 Lakhs (PY 2017-18 RS.2,000.00 Lakhs) during the current year based on their estimate.

The Company holds 29.99 % provision against the Non-Performing Assets.

2.2. As per the National Housing Bank Circulars NHB.HFC.DIR.4/CMD/2012 dated January 19, 2012 & NHB.HFC.DIR.9/CMD/2013 dated September 06, 2013, and vide notification no. NHB.HFC.DIR.18/MD&CEO/2017 dated August 02, 2017, all housing finance companies are required to carry a general provision (i) at the rate of 1% of Standard Assets in respect of Commercial Real Estates other than Residential Housing, (ii) at the rate of 0.75% of Standard Assets in respect of Commercial Real Estate - Residential Housing and (iii) at the rate of 0.25% of the total outstanding amount of loans which are Standard Assets other than (i) and (ii) above. Loans to individuals for 3rd dwelling units onwards shall be treated as Commercial Real Estate (CRE) exposure. National Housing Bank (NHB) vide notification no. NHB.HFC.DIR.18/MD&CEO/2017 dated August 02, 2017 reduced the provisioning requirement on Standard Individual Housing Loans from 0.40% to 0.25%. In terms of the said notification, as of March 31, 2019, the Company carries a cumulative provision of RS.6508.62 lakhs (PY 2017-18 : 5,540.80 lakhs) which is higher than the revised regulatory requirement of minimum of RS.6,508.62 Lakhs (PY 2017-18 RS.5,540.80 Lakhs). Accordingly the Company has made provision for Standard assets as detailed below.

The above investments are made to comply with the Statutory Liquidity Assets to be maintained under NHB Act. These carry a floating charge created in favour of trustees of depositors. The total investments under Statutory Liquidity Assets include RS.1,606.50 lakhs (PY 2017-18 RS.1,599.75 lakhs) [valued at amortised cost] in Government securities and other approved securities and RS.1,708.06.11 lakhs (PY 2017-18 RS.1,680.11 lakhs) in deposits with Nationalised Bank.

Note 2.3

Presentation of Investments as per Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 09, 2017 issued by the National Housing Bank.

3.1 Trade payables include HNil (Previous Year HNil) payable to “Suppliers" registered under The Micro, Small & Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the “suppliers" covered under The Micro, Small & Medium Enterprises Development Act, 2006. The above information takes into account only those suppliers who have responded to enquiries made by the company for this purpose.

4.1 During the year the Company has not issued any Secured Redeemable Non-Convertible Non-Cumulative Taxable Debentures (previous year Rs.1,40,000 lakhs). These debentures are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose.

4.2 Further, the Company has issued Unsecured Debentures in the nature of Tier II capital worth RS.10,000 lakhs in the financial year 2014-15 for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2019, 100% of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

5.1 Secured loans include borrowings from National Housing Bank, Canara Bank, HDFC Bank, and State Bank of India are secured by way of specific charge on book debts, outstanding, receivables, etc.,/ promissory notes and / or a negative lien on assets of the Company. The tenure of the Long term borrowings are more than one year and upto 15 years and that of short term borrowings is less than 1 year.

5.2 There is no amount of continuing default as on the Balance Sheet date in terms of repayment of loans & interest on Borrowings of the Company.

5.3 As per the directions of the National Housing Bank, the Company has created floating charge on Statutory Liquid Assets (Investments in Govt. Securities (including other approved securities) and Deposits in Commercial Banks) in favour of the Trustees of the depositors in a manner prescribed by the National Housing Bank in terms of sub-sections (1) & (2) of section 29B of the NHB Act, 1987 [ Refer Note 3.1 and 6.1].

6.1 As required under Section 125 of the Companies Act, 2013, the Company has transferred RS.5.19 lakhs (Previous Year RS.10.41 lakhs) to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2019, except to the extent of RS.59.34 lakhs (previous year RS.56.37 lakhs) in respect of claims that are disputed. As of March 31, 2019, no amount was due for transfer to the IEPF.

6.2 There are no dividends which are pending to be transferred to Investor Education and Protection Fund as per Sec 125 of the Companies Act, 2013 as at year end.

7.1 During the Financial Year 2017-18 the Company has subdivided the face value of its equity shares from RS.10 each to RS.2 each w.e.f October 13, 2017 (Record date). In view of the same, the number of equity shares under Authorised Capital has increased to 35,00,00,000 shares of RS.2 each, the number of equity shares under Issued & Subscribed Capital has increased to 13,32,27,875 shares of RS.2 each and the number of equity shares under Paid up Capital has increased to 13,31,01,210 shares of RS.2 each. Consequent to sub-division and for the reasons stated in Note no. 18.2 the aggregate number of Paid up Equity shares of the Company as at March 31, 2018 stands at 13,31,54,125 shares of RS.2 each.

7.2 During the financial year 2017-18, 52,915 equity shares of RS.2 each (in lieu of 10,583 equity shares of RS.10 each, which were kept in abeyance during the Rights Issue made by the Company in March 2015) were allotted as per the judgement of Hon''ble High Court of Kerala.

7.3 Terms and rights attached to Equity Shares: The Company has one class of Equity shares having a face value of RS.2/- per share and each shareholder is eligible for one vote per share held. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount in proportion to their shareholdings.

7.4 For the period of five years immediately preceding the FY 2018-19

(A) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash is NIL

(B) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares is NIL

(C) Aggregate number and class of shares bought back is NIL

8.1: As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible transfer u/s 29C of the NHB Act, 1987 also. The Company has transferred a sum of RS.8,739.45 lakhs (previous year RS.8,300 lakhs) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and RS.5,935.29 lakhs (previous year RS.6,100 lakhs) to Additional Reserve u/s 29C of the NHB Act, 1987 during the FY 2018-19.

8.2: The Company has paid dividend of RS.2/- per share on the equity shares of face value of RS.2/- each pertaining to FY 2017-18, post approval by the members in the 31st AGM held on 18th July, 2018.

8.3: The Board of Directors, have recommended final dividend of RS.2/- per equity share, this dividend will be paid after the approval of the members at the ensuing AGM. According to the requirements of Ind AS 10- Events occurring after Balance sheet date, the dividend declared and tax thereon shall only be recognised as a liability in the books of account in the year in which the dividends are declared on approval by members. The total estimated dividend on equity shares and dividend tax to be paid is RS.2,663.08 lakhs and RS.547.40 lakhs respectively.

8.4 Presentation of Reserve Fund as per NHB''s policy circular reference NHB(ND)/ DRS/ Pol.Circular.61/ 2013-14 dated April 07, 2014 and Notification No. NHB.HFC.CG-DIR.1/MD&CE0/2016 dated February 09, 2017 issued by National Housing Bank.

9.1 The Company has entered into lease cum licence agreement with M/s Encore Theme Technologies Pvt. Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to H354.60 lakhs (Previous Year H329.23 lakhs) is charged off to the P & L account under Professional fees - IBS.

Note 10. Operating Lease

Future minimum lease payments under non- cancelable operating leases

The Company has various operating leases, mainly for office buildings. Lease rental expense under non-cancellable operating lease during the year ended March 31, 2019 amounted to RS.1,144.24 lakhs (for the year ended March 31, 2018 : RS.991.21 lakhs, for the year ended March 31, 2017 : RS.796.80 lakhs). The company does not have any operating lease which has minimum lock-in period clause during the tenor of the rental agreements and hence there are no future minimum lease payments under non-cancellable operating lease at the end of the year.

The Company was creating a Special Reserve in accordance with Section 36(1)(viii) of the Income tax Act, 1961 which was eligible as a tax deduction for income tax purposes. Accordingly, as per the erstwhile accounting GAAP(AS 22 on “"Taxes on Income"") and as per instructions from National Housing Board a deferred tax liability was being created on such special reserve. As per the Ind AS accounting framework there is no requirement to create such a deferred tax liability, as the tax base and carrying amount of the Special reserve are the same.

Accordingly, the value of deferred tax liability on special reserve as at the transition date amounting to RS.12,539.59 lakhs would be reversed directly into the retained earnings and the amount recognised in the previous year amounting to H3,122.66 lakhs has been reversed through the profit and loss statement.

Defined Benefit Plans:

1. Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

2. Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a maximum of 240 days.

3. Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

4. Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

5. Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

Sensitivity Analysis

The sensitivity analysis presented below may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of reporting year, which is same as that applied in calculating the defined benefit obligation liability recognized in the balance sheet.

Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below:

Note 11. Financial Risk Management

i) Credit Risk

It is defined as the inability or unwillingness of the counterparty to meet the commitment in relation to lending, trading, hedging, settlement and other financial transactions. Also it is defined as the possibility of losses associated with diminution in the credit quality of borrowers or counter parties. The Credit policy articulates credit risk strategy to effectively communicate it throughout the company and all relevant personnel to understand company''s approach to grant of credit. The Policy covers products/borrower category, frame work for appraisal process, guidelines for takeover of accounts, entry level matrix (credit scoring system) and flexibility in pricing, dispensation of credit, monitoring and review mechanism, limit structure/prudential exposure levels, reporting frame work. The Company has put in place a proper Loan Review Mechanism with responsibilities assigned in various areas such as, evaluating the effectiveness of loan administration, maintaining the integrity of credit grading process, assessing the loan loss provision, portfolio quality, etc. Credit grading involves assessment of credit quality, identification of problem loans, and assignment of risk ratings. Monitoring is being done through guidelines to branches; follow up by overseeing executives and other regular follow up.

1. The provision estimated as per ECL model on an aggregate basis is lower than the overall provision required under IRAC norms of the NHB. The Management on a conservative approach has decided to maintain the higher provision.

2. The company has availed the exception offered in Paragraph B8G of Ind AS 101- First time Adoption of Ind AS. Based on their assessment, the company has concluded that the financial instruments held had low credit risk and hence additional provisions over and above those already held was not considered necessary.

3. As at balance sheet date, the Company does not have significant concentration of credit risk (Refer Note 44.9(ii)).

ii) Financial Risk

The market risk is the possibility of loss to the Company prices of security due to changes in the market factors, mainly the changes in interest rates, and competition. It is the risk to the Company''s earnings and capital due to the changes in the market interest rates. Market Risk also includes company''s ability to meet its obligations as and when due. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The Company has an Investment Policy/ Borrowing Policy in place which addresses the Market Risk which defines safety and liquidity will have preference over returns. Our majority of investment is by way of Bank Deposits and Govt. securities for the purpose of maintenance of SLR as prescribed by NHB. All these deposits are held to maturity. There is an ALM Committee of Executives at RO (ALCO), which functions as the operational unit for managing the balance sheet and asset liability mismatches. All the borrowing decisions and raising short term funds in the form of Non Convertible Debentures, Commercial Papers, Securitization and such other modes, are taken at appropriate level as per the Board approved policy on borrowings. Refer Note 5.6 for Asset Liability Management.

iii) Liquidity Risk

Probability of loss arising from a situation where (1) there will not be enough cash and/or cash equivalents to meet the needs of depositors and borrowers, (2) sale of illiquid assets will yield less than their fair value, or (3) illiquid assets will not be sold at the desired time due to lack of buyers. ALM Policy is in place which has set prudential limits for structural liquidity and interest rate risk. The ALCO committee of the Company analyzes the ALM position of the Company as at the end of each quarter and appraises the Board the ALM position of the respective quarters along with the proposed measure to improve the ALM position.

iv) Interest rate risk

Earnings risk is the danger that income may fluctuate due to changes in economic conditions or other factors. It is also the potential negative impact on the net interest income. The risk refers to vulnerability to movement in interest rates. Changes in interest rates effects earning, value of asset and cash flow. Asset Liability Management Committee (ALCO) meets at periodical intervals and assesses the earning risk and gives proper directions to the management to improve the NIM. Company shall monitor the income earned by way of interest and other income at quarterly intervals and place suitable notes to Board while placing notes on quarterly/half yearly/annual financial results of the Company. The limited avenues at the disposal of the Company for raising low cost/cost effective resources and our operating on thin spreads make market risk management all the more significant. The credit rating of our borrowings also have a significant impact on our net interest margin. Refer Note 44.4 for credit rating details.

Note 12. The Capital Structure is as follows:-

The Company''s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. The Company monitors the return on capital as well as the level of dividends on its equity shares. The Company''s objective when managing capital is to maintain an optimal structure so as to maximize shareholder value.

Ind AS 101- First time Adoption of Ind AS :

The financial statements of the Company for the year ended March 31, 2019 have been prepared in accordance with Ind ASs notified under the Companies (Indian Accounting Standards) Rules, 2015. The adoption of Ind AS was carried out in accordance with Ind AS 101, using April 1, 2017 as the transition date. Ind AS 101 requires that all Ind AS standards and interpretations that are effective for the Ind AS Consolidated Financial Statements for the year ended March 31, 2019, be applied consistently and retrospectively for all fiscal years presented.

All applicable Ind AS have been applied consistently and retrospectively wherever required. The resulting difference between the carrying amounts of the assets and liabilities in the consolidated financial statements under both Ind AS and Indian GAAP as of the Transition Date have been recognized directly in equity at the Transition Date.

In preparing these consolidated financial statements, the entity has availed itself of certain exemptions and exceptions in accordance with Ind AS 101 as explained below:

(a) Exceptions from full retrospective application:

1) Classification and measurement of financial assets:

The Company has availed the exception provided in Paragraph B8C of Ind AS 101 since the company has found it impracticable to apply the effective interest rate prior to the date of transition to Ind As considering the fact that the loans/ debentures have been given/received for long tenors. The exception has been availed for housing loans given and nonconvertible debentures issued.

The company has availed the exception offered in Paragraph B8G of Ind AS 101- First time Adoption of Ind AS. Based on their assessment, the company has concluded that the financial instruments held had low credit risk and hence the provision for loans those already held in the books of account as on April 01, 2017 was considered more than the expected credit loss and hence the additional provision was not considered necessary.

(b) Certain exemptions from the application from other Ind AS:

1) Deemed cost of Property, Plant and Equipment:

The Company has availed the exception provided in Paragraph D7AA of Ind AS 101 and taken the carrying value of Property, Plant and Equipment as on 31st March 2017 as Deemed Cost on 1st April 2017.

2) Fair value measurement of Employee loans at initial recognition prospectively:

The Company has availed the exemption provided in Paragraph D 20 of Ind AS 101 and have fair valued Employee Loans prospectively from the date of transition

(c) Reconciliations:

As required by Paragraph 24 of Ind AS 101, the following reconciliations provide a quantification of the effect of significant differences arising from the transition from Indian GAAP to Ind AS in accordance with Ind AS 101:

1. Reconciliation of Equity as at

a) 1st April 2017

b) 31st March 2018

2. Reconciliation of total comprehensive Income for the period ended

a) 31st March 2018

3. There were no significant reconciliation items between cash flows prepared under Indian GAAP and those prepared under Ind AS

1. Amortisation of Processing Fees:

The processing fees has been amortized over the tenure of the loan as per Ind AS 109. In case of fees collected on DSA sourced proposals, fees will be amortised over the tenor of the loan after reducing the DSA commission portion calculated by using weighted average on portfolio basis. Upon disbursement amount will be accounted under fees income in proportion to disbursement [Refer Note 2(k)(ii)].

2. Fair Valuation of Security Deposits:

As per previous GAAP, the security deposits were shown at their transaction value. As per Ind AS 109, refundable and non-statutory security deposits have been discounted to their present value on the date of contract. The difference between the carrying value and fair value is treated as ‘Prepaid Rent'' and the same has been amortised over the remaining tenure of such deposit.

3. Straight lining of Lease Rentals as per Ind AS 17:

As per previous GAAP, Lease Rentals were accounted as expense in Profit and Loss Statement for based on the terms and conditions of the lease agreement. As per Ind AS 17- Leases, lease rentals have been straight-lined over the non-cancellable lease period.

4. Employee benefits

Under previous GAAP, actuarial gains and losses were recognised in the statement of profit and loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability/ asset which is recognised in other comprehensive income. Consequently, the tax effect of the same has also been recognised in other comprehensive income under Ind AS instead of the statement of profit and loss. As per Ind AS 1 and Ind AS 19, actuarial gains and losses have to be presented in Other Comprehensive Income

5. Transaction cost on issue of debentures:

As per previous GAAP, the transaction cost incurred for issue of debentures were recognised as expense as and when incurred. Under Ind AS 109, the transaction cost incurred on issue of debentures are forming part of the computation of Effective interest rate (EIR). [Refer Note 2 (d)(b)].

6. Adjustment on account of Investment carried at amortised cost:

As per previous GAAP, investments are carried at cost . As per Ind AS 109, SLR Investments acquired at a discount have been amortised over the period of the investment effective rate of interest.

7. Adjustment on account of employee loans carried at amortised cost:

As per previous GAAP, loans to employees were being carried at their transaction value . As per Ind AS 109, these loans are discounted to their present value on transition date. The difference between the carrying value and fair value is treated as deferred employee loans and the same has been amortised over the remaining tenure of such loans.

8. Reversal of Deferred Tax Liability on Special Reserve [Refer Note 34]:

As per previous GAAP, DTL was created on the special reserve created under section 36(1)(viii) of the Income Tax Act, 1961 as per the requirement of circular no NHB(ND)/DRS/Policy Circular 65/2014-15 dated August 22, 2014. Under Ind AS 12-Taxes on Income, there is no difference beween carrying amount of special reserve as per books of account and its tax base. Accordingly DTL is not required to be created on the special reserve. As per Ind AS-12, current tax on items which are recognised outside Profit & Loss Statement shall also be recognised outside the Profit & Loss Statement. Since the special reserve is appropriated from profit and accounted in Other Equity, the current tax on the same also has been accounted in Other Equity.

9. Deferred tax impact due to Ind AS Adjustments:

The deferred tax has been recognised on temporary differences arising on transition to Ind AS.

Disclosures required as per Housing Finance Companies - Corporate Governance (NHB) Directions, 2016 issued by National Housing Bank (NHB)

Note 1: Term deposit amounting to RS.25,700.42 Lakhs (matured on 10th April''2019) held with Canara Bank is reduced in the computation of Net owned funds. The CRAR without considering the aforesaid term deposit would have been 19.24% (Tier I Capital of 17.44%).

Note 2: Tier II capital includes Provision for Standard Assets.

B. Exposure to Capital Market : NIL

C. Details of financing of parent company products : NIL

D. Details of Single Borrower Limit (SGL) / Group Borrower Limit (GBL) exceeded by the HFC : NIL

E. Unsecured Advances : NIL

Note 44.3 Registration obtained from other financial sector regulators during the year:

(i) Renewal of registration of the Company as LEI (Legal Entity Identifier) as required by RBI.

(ii) Registration of Company on TReDS (Trade Receivables Discounting System) platform trough RXIL (Receivables Exchange of India Limited) as required by MCA (Ministry of Corporate Affairs).

(iii) Registration of the Company as Business user for filing of returns in FIRMS (Foreign Investment Reporting and Management System).

(iv) Registration of Company as convergence partner with NCH (National Consumer Helpline) through software “INGRAM" as directed by NHB

Note 13.1

Revenue Recognition: No revenue recognition has been postponed pending the resolution of significant uncertainties. Note 44.6 Indian Accounting Standard 110 - Consolidated Financial Statements

The subject Standard is not applicable for the Company.

Note 13.2 Draw Down from Reserves

There was no draw down from reserves during the year.

The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010 except for one instance detailed below.

“NHB vide its letter NHB(ND)/DRS/APPEAL-1/17/A-744/2019 dated January 17, 2019 has imposed a penalty of RS.5,900 (inclusive of GST@18%) on account of contravention of section 32 of the NHB Act, 1987 and the Fair Practice Code issued by NHB which is paid under protest by the Company.

Note 13.3 Derivatives

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 09, 2017 issued by the National Housing bank.

a) Forward Rate Agreement (FRA) / Interest Rate Swap (IRS): No exposure

b) Exchange Traded Interest Rate (IR) Derivative: No exposure

c) Disclosures on Risk Exposure in Derivatives : Not applicable Note 44.12 Securitisation

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 09, 2017 issued by the National Housing bank.

The Company has no exposure under Securitisation.

The Company has not provided any loans on collateral of Gold and Gold jewelleries.

Note 13.4

The Company is a large Corporate as per the applicability criteria given under the SEBI Circular SEBI/HO/DDHS/CIR/P/ 2018/144 dated November 26, 2018.

Note 14. Corporate Social Responsibility (CSR)

Your Company constituted a Corporate Social Responsibility (CSR) Committee of the Board as prescribed under Section 135 of the Companies Act 2013 and has put the CSR policy in place. The Company has focussed in promoting education including special education and employment in enhancing vocation skills especially among children. The Company also focuses on women empowerment by Promoting gender equality, setting up homes and hostels for women and orphans; setting up old age homes, day care centres, livelihood enhancement projects for the elderly & the differently abled. Reducing inequalities faced by socially and economically backward group and contribution to Prime Minister''s National Relief Fund also forms part of its CSR activities.

The activities undertaken by the Company under CSR is Pan India basis and the projects are executed by our branches in those areas. The total amount/ budget under CSR for the FY 2018-19 was RS.1,051 lakhs, (previous year RS.668 lakhs), out of which total amount spent under the CSR activities is RS.606.24 lakhs (previous year H338 lakhs). The unspent amount of RS.445 lakhs is carried forward as per provisions of Companies Act with the aim to go in for granular details/ appropriate projects before spending in FY 19-20. A summary of CSR details as on March 31, 2019 is given below:

Note 15. Previous years figures have been re-arranged/ regrouped wherever necessary to correspond with the current year''s classification/disclosure.


Mar 31, 2018

1.1 The Company has subdivided the face value of its equity shares from RS.10 each to RS.2 each w.e.f 13/10/17 (Record date). In view of the same, the number of equity shares under Authorised Capital has increased to 35,00,00,000 shares of RS.2 each and the number of shares under Issued & Subscribed Capital has increased to 13,32,27,875 equity shares of RS.2 each. The number of equity shares under Paid up Capital has increased to 13,31,01,210 consequent to sub-division and for the reasons stated in Note no. 2.2 the aggregate number of Paid up Equity shares of the Company as at March 31, 2018 stands at 13,31,54,125 shares of RS.2 each.

1.2 During the financial year 2017-18, 52,915 equity shares of RS.2 each (in lieu of 10,583 equity shares of RS.10 each, which were kept in abeyance during the Rights Issue made by the Company in March 2015) were allotted as per the judgement of Hon’ble High Court of Kerala.

1.3 Terms and rights attached to Equity Shares: The Company has one class of Equity shares having a face value of RS.2/- per share and each shareholder is eligible for one vote per share held. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount in proportion to their shareholdings.

1.4 For the period of five years immediately preceding the FY 2017-18

(A) Aggregate number and class of shares allotted as fully paid-up pursuant to contract(s) without payment being received in cash is NIL

(B) Aggregate number and class of shares allotted as fully paid-up by way of bonus shares is NIL

(C) Aggregate number and class of shares bought back is NIL

2.1 Special Reserve has been created over the years in terms of Income Tax Act 1961, out of the distributable Profits of the Company.

2.2 As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible Transfer U/S 29C of the NHB Act, 1987 also. The Company has transferred a sum of RS.8,300 lakh (previous year RS.6,400 lakh) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and RS.6,100 lakh (previous year RS.4,800 lakh) to Additional Reserve U/S 29C of the NHB Act, 1987 during the FY 2017-18.

2.3 Vide Circular NHB(ND)/DRS/Pol.62/2014 dated May 27, 2014, the National Housing Bank (NHB) had directed Housing Finance Companies (HFCs) to provide for deferred tax liability in respect of the balance in the “Special Reserve” created under section 36(1)(viii) of the Income Tax Act, 1961 as on March 31, 2014 and permitted to adjust the same from Retained Earnings. Further, vide Circular NHB(ND)/DRS/Pol.65/2014 dated August 22, 2014, NHB has permitted HFCs to adjust the Deferred Tax Liability in a phased manner, over a period of three years in the ratio of 25:25:50 starting from FY 2014-15. Accordingly the Company had to create RS.7399.96 lakh DTL in three years. The Company had transferred the third and final tranche of 50% being RS.3700 lakh in the previous year ending March 31, 2017 from the General Reserves to DTL (RS.3700 lakh transferred in the preceding two years).

2.4 Further, Deferred Tax Liability (net) of RS.2759.52 lakh (previous year RS.1977.65 lakh) is charged off to the Statement of Profit & Loss, on account of various components of assets & liabilities including Special Reserve appropriated during the current year.

2.5 The Company has paid dividend of RS.10/- per share on the equity shares of face value of RS.10/- each pertaining to FY 2016-17, post approval by the members in the 30th AGM held on 28th June, 2017.

2.6 The Board of Directors, have recommended final dividend of RS.2/- per equity share, this dividend will be paid after the approval of the members at the ensuing AGM. According to the requirements of AS 4 (Revised)- Contingencies and events occurring after Balance sheet date, proposed dividend and tax thereon are not required to be recognised as a liability in the books of account for the year it pertains to. However it will be recorded as a liability on approval by members.

2.7 Presentation of Reserve Fund as per NHB’s policy circular reference NHB(ND)/ DRS/ Pol.Circular.61/ 2013-14 dated April 7, 2014 and Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 9, 2017 issued by National Housing bank.

3.1 The borrowings from National Housing Bank, Canara Bank, HDFC Bank, and State Bank of India are secured by way of specific charge on book debts, outstanding, receivables, etc.,/ promissory notes and / or a negative lien on assets of the Company. The tenure of the Long term borrowings are more than one year and upto 15 years and that of short term borrowings is less than 1 year.

3.2 There is no amount of continuing default as on the Balance Sheet date in terms of repayment of loans & interest on Borrowings of the Company,

3.3 During the year the Company has issued Secured Redeemable Non-Convertible Non-Cumulative Taxable Debentures worth RS.1,40,000 lakh (previous year RS.1,86,200 lakh) through private placement. These debentures are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose.

3.4 Further, the Company has issued Unsecured Debentures in the nature of Tier II capital worth RS.10000 lakh in the financial year 2014-15 for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2018, 100% of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

3.5 As per the Directions of the National Housing Bank, the Company has created floating charge on Statutory Liquid Assets (Investments in Govt. Securities and Deposits in Commercial Banks) in favour of the Trustees of the depositors in a manner prescribed by the National Housing Bank in terms of sub-sections (1) & (2) of section 29B of the NHB Act, 1987.

4.1 The Overdraft account with related party includes RS.12,929.97 lakh (previous year RS.15,106.07 lakh) being the cheques issued towards disbursements to borrowers and towards expenses but not encashed as on March 31, 2018.

5.1 Trade payables include H Nil (Previous Year H Nil) payable to “Suppliers” registered under The Micro, Small & Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the “suppliers” covered under The Micro, Small & Medium Enterprises Development Act, 2006. The above information takes into account only those suppliers who have responded to enquiries made by the company for this purpose.

5.2 As required under Section 125 of the Companies Act, 2013, the Company has transferred RS.10.41 lakh (Previous Year RS.0.72 lakh) to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2018, except to the extent of RS.56.37 lakh (previous year RS.63.44 lakh) in respect of claims that are disputed. As of March 31, 2018, no amount was due for transfer to the IEPF.

5.3 Interest accrued but not due on Borrowings includes Interest on Debentures of RS.21,755.89 lakh (previous year RS.14,702.75 lakh).

6 DEFERRED TAX ASSET / LIABILITY

In view of Accounting Standard 22 “Accounting for Taxes on Income”, adjustment to the deferred tax liability (net) of RS.2,759.52 lakh {Previous year RS.1,977.65 lakh} has been made and is adjusted against provision for tax for the current year. Deferred tax assets and liabilities are measured using tax rates and tax laws that have been enacted or substantively enacted as at the reporting date. The tax effects of significant timing (temporary) differences that resulted in deferred tax assets and liabilities and description of the financial statement items are as follows:

7.1 Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Bank guarantees, company guarantees or personal Guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

7.2 The Company has acquired certain assets under SARFAESI Act which are retained for the purpose of sale under the rules and regulations of SARFAESI Act involving market value of RS.667.62 Lakh (PY 2016-17: RS.533.71 Lakh), which are part of NPA portfolio aggregating to RS.559.68 Lakh (PY 2016-17: RS.500.80 lakh) for which necessary provisions have already been made. These assets are accounted as and when they are realized.

7.3 Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2018. Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of RS.1,773.01 lakh (Previous year RS.1,115.02 lakh) against which the company, by way of prudence and abundant caution has maintained cumulative provision of RS.3586.83 lakh (Previous year RS.2791.11 lakh).

The Company has provided 63 % provision for Non-Performing assets. Additional Provision provided in the current year is RS.2000.00 lakh (previous year RS.815.38 lakh).

8.1 As per the National Housing Bank Circulars NHB.HFC.DIR.4/CMD/2012 dated January 19, 2012 & NHB.HFC.DIR.9 /CMD/2013 dated September 6, 2013, and vide notification no. NHB.HFC.DIR.18/MD&CEO/2017 dated August 2, 2017, all housing finance companies are required to carry a general provision (i) at the rate of 1% of Standard Assets in respect of Commercial Real Estates other than Residential Housing, (ii) at the rate of 0.75% of Standard Assets in respect of Commercial Real Estate - Residential Housing and (iii) at the rate of 0.25% of the total outstanding amount of loans which are Standard Assets other than (i) and (ii) above. Loans to individuals for 3rd dwelling units onwards shall be treated as Commercial Real Estate (CRE) exposure.

National Housing Bank (NHB) vide notification no. NHB.HFC.DIR.18/MD&CEO/2017 dated August 2, 2017 reduced the provisioning requirement on Standard Individual Housing Loans from 0.40% to 0.25%. In terms of the said notification, as of March 31, 2018, the Company carries a cumulative provision of RS.6,475 lakh which is higher than the revised regulatory requirement of minimum RS.5540.80 lakh. Accordingly the Company has made provision for Standard assets as detailed below.

9.1 The above deposits are held to comply with the Statutory Liquidity Assets required to be maintained under NHB Act. These carry a floating charge created in favour of trustees of depositors.

10.1 Employee Benefit Expenses include RS.612.87 lakh (Previous Year RS.459.21 lakh) towards provision made in respect of Gratuity, accumulated leave salary (PL encashment), Statutory Provident Fund and Leave Travel Assistance which is in the nature of Long Term Employee Benefits and has been actuarially determined as per the Accounting Standard on Employee Benefits (AS 15).

11.1 The Company has entered into lease cum licence agreement with M/s Encore Theme Technologies Pvt. Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to RS.329.23 lakh (Previous Year RS.299.35 lakh) is charged off to the P & L account under Professional fees - IBS.

12 OTHER DISCLOSURES REQUIRED AS PER NATIONAL HOUSING BANK (NHB)

The following additional disclosures have been given in terms of the circular no. NHB/ND/DRS/Pol-No.35/2010-11 dt. October 11, 2010 and Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 9, 2017 issued by the National Housing bank.

13a)Registration obtained from other financial sector regulators :

(i) The Company has obtained a registration certificate from the Trade Mark Registry for registration of Logo of the Company. (not financial sector).

(ii) The Company has registered itself with Insurance Regulatory and Development Authority for carrying out the ‘Corporate Agency Business’.

(iii) RBI has issued a notification No. RBI/2017-18/82.DBR.NO.BP.BC.92/21.04.048/2017-18 dated 02/11/2017 for introduction of Legal Entity Identifier (LEI) to be obtained by large corporate borrowers. The company has obtained a LEI registration number: 335800EJ9Y3XDP5ZDRS.81

(iv) The Company has registered itself with the Information Utility [NeSL (National E Governance Services Ltd.)] as required under Insolvency & Bankruptcy Code, 2016

13b) Revenue Recognition

No revenue recognition has been postponed pending the resolution of significant uncertainties.

13c) Accounting Standard 21 - Consolidated Financial Statements (CFS)

The subject Standard is not applicable for the Company.

13d) Draw Down from Reserves

There was no draw down from Reserves during the year 2017-18 .

13e) Concentration of Public Deposits, Advances, Exposures and NPAs

DEFINED BENEFIT PLANS

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

14 Segment Reporting - The company’s primary business is of housing finance. During the year the Company has commenced corporate insurance agency business activity and it is not a separate reportable segment as per Accounting Standard on Segment reporting (AS-17) and hence the Segment reporting is not applicable to the Company.

15 The transactions with related parties as per Accounting Standard 18 “Related Party Disclosures” issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges are furnished below:

16 DISCLOSURE UNDER PARAGRAPH 29 OF THE HOUSING FINANCE COMPANIES (NHB) DIRECTIONS, 2010.

The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010 except for one instance detailed below.

National Housing Bank (NHB) in its regulatory Audit conducted during the financial year 2016-17 for F/Y 2014-15 & FY 2015-16 has raised an issue on the procedure followed by the Company since inception, on valuation of Government Securities under HTM category invested for SLR purpose. NHB vide its letter NHB(ND)/DRS/SUP/9349/2017 dated 19/09/2017 has imposed an aggregate penalty of RS.28,62,708.00 under the Provisions of Section 29B of the National Housing Bank Act, 1987 for the period 01/04/2014 to 27/07/2016 and the same is paid.

17 DERIVATIVES

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CE0/2016 dated February 9, 2017 issued by the National Housing bank.

a) Forward Rate Agreement (FRA) / Interest Rate Swap (IRS): No exposure

b) Exchange Traded Interest Rate (IR) Derivative: No exposure

c) Disclosures on Risk Exposure in Derivatives : Not applicable

18 SECURITISATION

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CE0/2016 dated February 9, 2017 issued by the National Housing bank.

The Company has no exposure under Securitisation.

19 CORPORATE SOCIAL RESPONSILITY (CSR)

Your Company constituted a Corporate Social Responsibility (CSR) Committee of the Board as prescribed under Section 135 of the Companies Act 2013 and has put the CSR policy in place. The Company has focussed in promoting education including special education and employment in enhancing vocation skills especially among children. The Company also focuses on women empowerment by Promoting gender equality, setting up homes and hostels for women and orphans; setting up old age homes, day care centres, livelihood enhancement projects for the elderly & the differently abled. Reducing inequalities faced by socially and economically backward group and contribution to Prime Minister’s National Relief Fund also forms part of its CSR activities.

The activities undertaken by the Company under CSR is Pan India basis and the projects are executed by our branches in those areas. The total amount/ budget under CSR for the FY 2017-18 was RS.668 lakh, (previous year RS.596 lakh), out of which total amount spent under the CSR activities is RS.338 Lakh (previous year RS.436 Lakh). The unspent amount of RS.330 Lakh is carried forward as per provisions of Companies Act with the aim to go in for granular details/ appropriate projects before spending in FY 18-19. A summary of CSR details as on 31/03/18 is given below:

20 Previous year figures have been rearranged / regrouped wherever necessary to correspond with the current year’s classification/ disclosure.


Mar 31, 2017

1. DISCLOSURE ON EMPLOYEE BENEFITS - AS 15 REVISED

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated up to a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated up to a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

2. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the Company’s primary business is of housing finance.

3. The transactions with related parties as per Accounting Standard 18 "Related Party Disclosures" issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges are furnished below:

(B) Key Management Personnel:

Shri S K Hota - Managing Director

Shri Atanu Bagchi - Deputy General Manager & Chief Financial Officer (CFO) Smt. Veena G Kamath - Company Secretary

(Amount written off: Nil | Amount written back: Nil | All the above are transacted in the normal course of business.)

4. NHB in its regulatory Audit conducted during the current financial year for FY14-15 has raised an issue on the procedure followed by the Company since beginning on valuation of Government Securities under HTM category invested for SLR purpose. Since there is no change in regulations/procedures during the period, matter has been represented by the Company and a final decision is awaited.’

5. DERIVATIVES

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 9, 2017 issued by the National Housing bank.

a) Forward Rate Agreement (FRA) / Interest Rate Swap (IRS): No exposure

b) Exchange Traded Interest Rate (IR) Derivative: No exposure

c) Disclosures on Risk Exposure in Derivatives : Not applicable

6. SECURITISATION

The following additional disclosures have been given in terms of the Notification No. NHB.HFC.CG-DIR.1/MD&CEO/2016 dated February 9, 2017 issued by the National Housing bank.

The Company has no exposure under Securitization.

7. The Company has constituted Corporate Social Responsibility (CSR) Committee to prescribe CSR policies and its implementation as per the section 135 of Companies Act, 2013. The CSR policy has been approved by the Committee on 19/01/15 and the Board of Directors on 20/01/15 and the same is already uploaded in the Company’s website. The total amount to be spent under the CSR for the FY16-17 is to the extent of RS,402.00 Lakh (including the unspent amount of RS,68.77 Lakh for FY15-16). The Company has so far spent RS,435.79 Lakh (previous year RS,108.72 Lakh), during the year. The balance unspent amount of RS,10.46 Lakh (previous year RS,8.70 Lakh), will be carried forward to FY17-18.

8. Disclosure of Specified Bank Notes (SBN) as per Notification no. G.S.R 308(E) dated 30/03/17 issued by the Ministry of Corporate Affairs:

The amount collected pertains to the loan accounts of the Borrowers and credited to the respective loan accounts.

9. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010.

10. Previous year figures have been rearranged/regrouped wherever necessary to correspond with the current year’s classification/disclosure.


Mar 31, 2016

1.1 During the previous year the Company has allotted 61,34,992 Equity Shares of the face value of Rs.10/- each for cash at a price of Rs.450/- each (inclusive of a premium of Rs.440/- per share) on Rights basis on March 9, 15 and the allotment of 10,583 equity shares are kept in abeyance pending receipt of final order by the Hon''ble High Court of Kerala.

1.2 Terms and Rights attached to Equity Shares: The Company has one class of Equity shares having a face value of Rs.10/- per share and each shareholder is eligible for one vote per share held. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amount in proportion to their shareholdings.

2.1 Special Reserve has been created over the years in terms of Income Tax Act 1961, out of the distributable Profits of the Company.

2.2 As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible Transfer U/S 29C of the NHB Act, 1987 also. The Company has transferred a sum of Rs.5,500 Lakh (previous year Rs.2,850 Lakh) to Special Reserve which is interms of Section 36(1)(viii) of the Income Tax Act, 1961 and 3,200 Lakh (previous year Rs.1,800 Lakh) to Additional Reserve U/S 29C of the NHB Act, 1987 during the FY 2015-16.

2.3 Vide Circular NHB(ND)/DRS/Pol.62/2014 dated May 27, 2014, the National Housing Bank (NHB) had directed Housing Finance Companies (HFCs) to provide for deferred tax liability in respect of the balance in the "Special Reserve" created under section 36(1) (viii) of the Income Tax Act, 1961 as on March 31, 14 and permitted to adjust the same from Retained Earnings. Further, vide Circular NHB(ND)/DRS/Pol.65/2014 dated August 22, 2014, NHB has permitted HFCs to adjust the Deferred Tax Liability in a phased manner, over a period of three years in the ratio of 25:25:50 starting from FY 2014-15. Accordingly the Company has to adjust the DTL of Rs.7,399.96 Lakh in three years. In the current year the Company has transferred Rs.1,850.00 Lakh (previous year Rs.1,850 Lakh) from the General Reserve to DTL on The Special Reserve outstanding as on March 31, 14.

2.4 Further, Deferred Tax Liability (net) of Rs.1,675.56 (previous year Rs.797.91 Lakh) is charged off to the Statement of Profit & Loss, on account of various components of assets & liabilities including Special Reserve appropriated during the current year.

2.5 The Company has in the previous year reworked the useful life on various Fixed Assets as prescribed in Part C of Schedule II of the Companies Act, 2013. In respect of those assets whose remaining useful life as on April 1, 14 was NIL, the same had been adjusted to the General Reserve as prescribed under 7(b) to the notes of the said Schedule II of the Companies Act, 2013.

2.6 The Company has in the current year recommended a Dividend of Rs.10/- on the Equity Shares of the face value of Rs.10/- each.

2.7 Presentation of Reserve Fund as per NHB''s policy circular reference NHB(ND)/ DRS/ Pol.Circular.61/ 2013-14 dated April 7, 2014:

3.1 The borrowings from National Housing Bank, HUDCO, Canara Bank, HDFC Bank, Bank of Baroda, Kotak Mahindra Bank, Federal Bank, Deutsche Bank and State Bank of India are secured by way of specific charge on book debts, outstanding, receivables, etc.,/ promissory notes and / or a negative lien on assets of the Company. The tenure of the Long term borrowings are between 2-15 years and that of short term borrowings is less than 1 year.

3.2 During the year the Company has issued Secured Redeemable Non-Convertible Non-Cumulative Taxable Debentures worth Rs.1,54,000 Lakh (previous year Rs.30,000 Lakh) through private placement totaling to Rs.2,09,000 Lakh. These debentures are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose. The debentures to the extent of Rs.25,000 Lakh (raised in the year 2013-14) are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose and also by mortgage of an immovable property (an apartment located at Kodigehalli, Hebbal, Bengaluru) in favour of the Debenture Trustees.

3.3 Further, the Company has issued Unsecured Debentures in the nature of Tier II Bonds worth NIL (previous year Rs.10,000 Lakh) for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2016, 100% of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

3.4 As per the Directions of the National Housing Bank, the Company has created floating charge on Statutory Liquid Assets (Investments in Govt. Securities and Deposits in Commercial Banks) in favour of the Trustees of the depositors in a manner prescribed by the National Housing Bank in terms of sub-sections (1) & (2) of section 29B of the NHB Act, 1987.

4.1 The Overdraft account with related party includes Rs.8,980.76 Lakh (previous year Rs.5,312.48 Lakh) being the cheques issued towards disbursements to borrowers and towards expenses but not encashed as on March 31, 2016.

4.2 The Company has issued Commercial Paper at a discount to the face value and the discount is amortised for the current year to the extent accrued and the unamortised amount of Rsm3,863.46 Lakh (previous year Rs.2,929.13 Lakh) is shown under Current Asset.

4.3 Other Liabilities include Nil (Previous Year Nil) payable to "Suppliers" registered under The Micro, Small & Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the "suppliers" covered under The Micro, Small & Medium Enterprises Development Act 2006. The above information takes into account only those suppliers who have responded to inquiries made by the company for this purpose.

4.4 As required under Section 125 of the Companies Act, 2013, the Company has transferred Rs.3.62 Lakh (Previous Year Rs.19.43 Lakh) to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2016, except to the extent of Rs.21.41 Lakh (previous year Rs.5.51 Lakh) in respect of claims that are disputed. As of March 31, 2016, no amount was due for transfer to the IEPF.

4.5 Provision for Expenses includes provision made for interest on NHB borrowings of Rs.7,025.46 Lakh (previous year Rs.NIL) and interest on Debentures of Rs.8,544.83 Lakh (previous year Rs.1,333.95 Lakh).

5.1 Loans and installments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and /or

(b) Other securities, assignment of life insurance policies and/or

(c) Bank guarantees, company guarantees or personal Guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

5.2 Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2016. Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs.935.73 Lakh (Previous year Rs.758.38 Lakh) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs.1,975.73 Lakh (Previous year Rs.1,435.19 Lakh).

6.1 Other Advances includes unamortised discount on Commercial Paper (CP) amounting to Rs.3,863.46 Lakh (previous year Rs.2,929.13 Lakh) and Advance Taxes paid (net of provisions) Rs.8,464.16 Lakh (previous year Rs.4,906.04 Lakh).

7.1 Employee Benefit Expenses include Rs.407.50 Lakh (Previous Year Rs.215.90 Lakh) towards provision made in respect of Gratuity, accumulated leave salary (PL encashment), Statutory Provident Fund and Leave Travel Assistance which is in the nature of Long Term Employee Benefits and has been actuarially determined as per the Accounting Standard on Employee Benefits (AS 15).

8.1 The Company has entered into lease cum licence agreement with M/s Encore Theme Technologies Pvt. Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to Rs.277.87 Lakh (Previous Year Rs.239.08 Lakh) is charged off to the P & L account under Professional fees – IBS.

9. The Company has provided 100% provision for Non-Performing assets. Additional Provision provided in the current year is Rs.540.53 Lakh (previous year Rs.224.77 Lakh).

10. Disclosure required as per NHB

The following additional disclosures have been given in terms of the circular no. NHB/ND/DRS/Pol-No.35/2010-11 dt. October 11, 2010 issued by the National Housing bank.

11. Disclosure on Employee Benefits – AS 15 Revised

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years

12. Segment Reporting – There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the company''s primary business is of housing finance.

13. The transactions with related parties as per Accounting Standard 18 "Related Party Disclosures" issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges are furnished below:

14. The National Housing Bank has levied penalty of Rs.NIL/- (previous year Rs.2,000/-) for a single instance of delayed submission of one Statutory Return.

15. There were no adverse comments on the company by the National Housing Bank on Regulatory compliance, which requires disclosure.

16. The Company has constituted Corporate Social Responsibility (CSR) Committee to prescribe CSR policies and its implementation as per the section 135 of Companies Act, 2013. The CSR policy has been approved by the Committee on January 19, 2015 and the Board of Directors on January 20, 2015 and the same is already uploaded in the Company''s website. The total amount to be spent under the CSR for the FY15-16 is to the extent of Rs.372.00 Lakh (including the unspent amount of Rs.158.90 Lakh for FY 14-15). The Company has so far spent Rs.108.72 Lakh (previous year Rs. 3.10Lakh), during the year. The balance unspent amount of Rs.263.28 Lakh (previous year Rs.158.90 Lakh), will be carried forward to FY 16-17.

17. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010.

18. Previous year figures have been rearranged / regrouped wherever necessary to correspond with the current year''s classification/ disclosure.


Mar 31, 2015

1. During the year the Company has allotted 61,34,992 Equity Shares of Rs. 10/- each for cash at a price of Rs. 450/- each (inclusive of a premium of Rs. 440/- per share) on Rights basis during March 2015 and the allotment of 10,583 equity shares are kept in abeyance pending receipt of final order by the Hon''ble High Court of Kerala.

2. Special Reserve has been created over the years in terms of Income Tax Act 1961, out of the distributable Profits of the Company.

3. As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible Transfer U/S 29C of the NHB Act, 1987 also. The Company has transferred a sum of Rs. 2,850 lakh (previous year Rs. 2,500 lakh) to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and Rs. 1,800 lakh (previous year Rs. 1,600 lakh) to Additional Reserve U/S 29C of the NHB Act, 1987 during the FY 2014-15.

4. Vide Circular NHB(ND)/DRS/Pol.62/2014 dated May 27, 2014, the National Housing Bank (NHB) had directed Housing Finance Companies (HFCs) to provide for deferred tax liability in respect of the balance in the "Special Reserve" created under section 36(1)(viii) of the Income Tax Act, 1961 as on 31/03/14 and permitted to adjust the same from Retained Earnings. Further, vide Circular NHB(ND)/DRS/Pol.65/2014 dated August 22, 2014, NHB has permitted HFCs to adjust the Deferred Tax Liability in a phased manner, over a period of three years in the ratio of 25:25:50 starting from FY 2014-15. Accordingly the Company has to adjust the DTL of Rs. 7399.96 lakh in three years. The Company has transferred Rs. 1850.00 lakh in the current year from the General Reserve to DTL on the Special Reserve outstanding as on 31/03/14.

5. Further, Deferred Tax Liability of Rs. 797.91 lakh (previous year Rs. 1 lakh) is charged off to the Statement of Profit & Loss, on account of Special Reserve appropriated during the current year.

6. The Company has reworked the useful life on various Fixed Assets as prescribed in Part C of Schedule II of the Companies Act, 2013. In respect of those assets whose remaining useful life as on 01/04/14 is NIL, the same has been adjusted to the General Reserve as prescribed under 7(b) to the notes of the said Schedule II of the Companies Act, 2013.

7. The borrowings from National Housing Bank, Canara Bank, HDFC Bank, Bank of Baroda, Kotak Mahindra Bank Federal Bank and Deutsche Bank are secured by way of specific charge on book debts, outstanding, receivables, etc.,/ promissory notes and / or a negative lien on assets of the Company. The tenure of the Long term borrowings are between 2-15 years and that of short term borrowings is less than 1 year.

8. During the year the Company has issued Secured Redeemable Non-Convertible Non-Cumulative Taxable Debentures worth Rs. 30,000 lakh (previous year Rs. 25,000 lakh) through private placement totalling to Rs. 55,000 lakh. These debentures are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose. The debentures to the extent of Rs. 25000 lakhs (raised in the previous year) are secured by way of floating charge on the assets i.e., loan receivables specifically earmarked for the purpose and also by mortgage of an immovable property (an apartment located at Kodigehalli, Hebbal, Bangalore) in favour of the Debenture Trustees.

9. Further, the Company has also issued Unsecured Debentures in the nature of Tier II Bonds worth Rs. 10,000 lakh (previous year NIL) for a term of 10 years through private placement. These Debentures are subordinated to present and future senior indebtedness of the Company and qualify as Tier II Capital under the National Housing Bank (NHB) guidelines for assessing capital adequacy. Based on the balance term to maturity as at March 31, 2015, 100% of the book value of the subordinated debt is considered as Tier II Capital for the purpose of Capital Adequacy computation.

10. As per the Directions of the National Housing Bank, the Company has created floating charge on Statutory Liquid Assets (Investments in Govt. Securities and Deposits in Commercial Banks) in favour of the Trustees of the depositors in a manner prescribed by the National Housing Bank in terms of sub-sections (1) & (2) of section 29B of the NHB Act, 1987.

11. The Overdraft account with related party includes Rs. 5,312.48 lakh (previous year Rs. 4,164.34 lakh) being the cheques issued towards disbursements to borrowers and towards expenses but not encashed as on 31/03/15.

12. The Company has issued Commercial Paper at a discount to the face value and the discount is amortised for the current year to the extent accrued and the unamortised amount of Rs. 2,929.13 lakh (previous year Nil) is shown under Current Asset.

13. Other Liabilities include Rs. Nil (Previous Year Rs. Nil) payable to "Suppliers" registered under The Micro, Small & Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the "suppliers" covered under The Micro, Small & Medium Enterprises Development Act 2006. The above information takes into account only those suppliers who have responded to inquiries made by the company for this purpose.

14. As required under Section 125 of the Companies Act, 2013, the Company has transferred H19.43 lakh (Previous Year H14.46 lakh) to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2015, except to the extent of H5.51 lakh (previous year H5.79 lakh) in respect of claims that are disputed. As of March 31, 2015, no amount was due for transfer to the IEPF.

15. Provision for Expenses includes provision made for interest on NHB borrowings of Rs. NIL (previous year H51.41 cr), interest on Canara Bank borrowings of Rs. NIL (previous year H18.79 cr) and interest on Debentures of H13.34 cr (previous year H5.12 cr).

16. DEFERRED TAX ASSET

In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, adjustment to the deferred tax asset of Rs. 797.91 Lakh {Previous year Rs. 1 lakh} has been made and is adjusted against provision for tax for the current year. The tax effects of significant timing (temporary) differences that resulted in deferred tax assets and liabilities and description of the financial statement items are as follows:

17. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Bank guarantees, company guarantees or personal Guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

18. The accounts where the tenure of repayment was extended on 30/1 1/2013, upon review, the Company has classified such accounts as on 31/03/2015 as Standard Assets in respect of Loan accounts having satisfactory performance of one year and where the overdues are less than 90 days. In respect of loan accounts where the overdues are more than 90 days, they have been classified as NPA.

19. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2015. Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs. 758.38 lakh (Previous year Rs. 658.65 lakh) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs. 1435.19 lakh(Previous year Rs. 1210.42 lakh).

20. As per the National Housing Bank Circulars NHB.HFC.DIR.4/CMD/2012 dated January 19, 2012 & NHB.HFC.DIR.9 /CMD/2013 dated September 6, 2013, in addition to the provision for non performing assets, all housing finance companies are required to carry a general provision (i) at the rate of 1% of Standard Assets in respect of Commercial Real Estates other than Residential

21. contingent liabilities

(Rs. in Lakh)

Nature As of As of Risk involved of 31.03. 31.03. claims 2015 2014

Disputed 761.16 927.55 1. The Income Tax Appeals filed by Income the Department for the Asst.Years 1996-97 Tax to 1999-2000 have been dismissed by matters the Hon''ble High Court of Karnataka under and allowed in favour of the Company. appeal: The Department has filed two separate appeals before the Hon''ble Supreme Court of India for the Asst. Year 1996- 97 which has since been dismissed. 2. The appeals filed by the Company for the Asst. Year 2006-07 and 2007- 08 were dismissed by the 2nd appellate authority and the Company has preferred appeals before the Hon''ble High Court of Karnataka which are admitted and yet to be heard. The alleged demand for the Asst. Year 2006-07 (under appeal) has been recovered by the Department to the extent of Rs. 535 lakh out of the refunds determined to the Company. The alleged demand for the Asst. Year 2007- 08 (under appeal) amounting to Rs.448.13 lakh towards the alleged Income Tax and interest, is continued to be shown as such under disputed Tax.

3. An amount of Rs. 16.44 lakh demanded for the Asst. Year 2011-12 continues to be shown under disputed tax, pending receipt of rectification orders against which the Company has determined a liability of Rs. 1.97 lakh to be adjusted against the refund due to the Company.

Claims 4.66 3.16 1. There are four cases in Consumer made by Court and one case in High Court borrowers pending where compensation is of the sought against the Company. company before various Consumer Forums.

22. The Company has entered into lease cum licence agreement with M/s Theme Encore Ltd., for implementation of Integrated Business Suite (IBS) software. The expenditure incurred in this regard amounting to H239.08 lakh (Previous Year H193.04 lakh) is charged off to the P & L account under Professional fees - IBS.

The Company has provided 100% provision for Non-Performing assets. Additional Provision provided in the current year is H224.77 lakh (previous year Rs. Nil) and withdrawal of excess provision in the current year Rs. NIL (previous year H355.69 lakh)

Rs. 26 Disclosure required as per NHB

The following additional disclosures have been given in terms of the circular no. NHB/ND/DRS/Pol-No.35/2010-1 1 dt. October 11, 2010 issued by the National Housing bank.

23. Disclosure on Employee Benefits - AS 15 Revised

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the company''s primary business is of housing finance.

(B) Key Management Personnel:

Shri C.Ilango - Managing Director

Shri K.S.Sathyaprakash - Company Secretary upto 31/03/15

Shri Atanu Bagchi - Assistant General Manager & Chief Financial Officer (CFO)

Smt. Veena G Kamath - Company Secretary w.e.f. 01/04/15

The National Housing Bank has levied penalty of Rs. 2000/- (previous year Nil) for a single instance of delayed submission of one Statutory Return.

The adverse comments on the company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure have been disclosed wherever required.

The Company has appointed one woman director from 22/09/2014 in compliance to section 149 of the Companies Act, 2013.

The Company has constituted Corporate Social Responsibility (CSR) Committee to prescribe CSR policies and its implementation as per the section 135 of Companies Act, 2013. The CSR policy has been approved by the Committee on 19/01/15 and the Board of Directors on 20/01/15 and the same is already uploaded in the Company''s website. The total amount to be spent under the CSR for the F.Y. 2014-15 is to the extent of Rs. 162 lakh (previous year Nil), out of which the Company has so far spent Rs. 3.10 lakh during the year. The balance unspent amount of Rs. 158.90 lakh will be carried forward to F.Y. 2015-16.

The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2010.

Previous year figures have been rearranged/regrouped wherever necessary to correspond with the current year''s classification/ disclosure.


Mar 31, 2014

1. Special Reserve has been created over the years in terms of Income Tax Act 1961, out of the distributable Profits of the Company.

2. As per Section 29C of the National Housing Bank Act, 1987, the Company is required to transfer at least 20% of its net profits every year to a reserve before any dividend is declared. For this purpose, any Special Reserve created by the Company under Section 36(1) (viii) of the Income Tax Act, 1961 is considered to be an eligible Transfer U/S 29C of the NHB Act, 1987 also. The Company has hitherto transferred a sum of Rs. 19,871 lakh to Special Reserve which is in terms of Section 36(1)(viii) of the Income Tax Act, 1961 and Rs. 1,100 lakh to Additional Reserve created during 2012-13 U/S 29C of the NHB Act, 1987. During the FY 2013-14, Company has transferred a sum of Rs. 2,500 lakh to the Special Reserve and Rs.1,600 lakh to the Additional Reserve.

3. Presentation of Reserve Fund as per NHB''s policy circular reference NHB(ND)/ DRS/ Pol.Circular.61/ 2013-14 dated April 7, 2014;

4. The borrowings from National Housing Bank, Canara Bank, HDFC Bank and Bank of Baroda are secured byway of specific charge on book debts, outstanding, receivables, etc.,/ promissory notes and / or a negative lien on assets of the Company. The tenure of the Long term borrowings are between 2-15 years and that of short term borrowings is less than 1 year.

5. During the year the Company has issued Secured Redeemable Non-Convertible Non-Cumulative Taxable Debentures worth Rs. 250 cr, repayable after three years with yearly fixed interest of 10.05%, through private placement. These debentures are secured by negative lien on the assets of the Company and immovable property - an apartment located at Kodigehalli, Hebbal, Bangalore.

6. As per the Directions of the National Housing Bank, the Company has created floating charge on Investments

in Govt. Securities and Deposits in Commercial Banks in favour of depositors in a manner prescribed by the National Housing Bank.

7. Other Liabilities include Rs. Nil (Previous Year Rs. Nil) payable to "Suppliers" registered under The Micro, Small S-Medium Enterprises Development Act 2006. No interest has been paid by the company during the year to the "suppliers" covered under The Micro, Small S-Medium Enterprises Development Act 2006. The above information takes into account only those suppliers who have responded to inquiries made by the company for this purpose.

8. As required under Section 205C of the Companies Act, 1956, the Company has transferred Rs. 14.46 lakh (Previous Year Rs. 6 lakh) to Investor Education and Protection Fund (IEPF) during the year as of March 31, 2014.

9. Provision for Expenses includes provision made for interest on NHB borrowings of Rs. 51.41 cr (previous year Rs. 37.57 cr), interest on Canara Bank borrowings of Rs. 18.79 cr (previous year Rs. 12.92 cr), interest on Debentures of Rs.5.12 cr (previous year NIL) and Service Tax liability under Rule 6(3B) of Cenvat Credit Rules, 2004 amounting to Rs. 0.59 cr (previous year NIL).

10. Loans and installments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal Guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

11. The Company has extended the repayment period of all individual and rural housing loans by two years uniformly on 1st November 2013 (Board approval on 15/08/13) subject to restriction of 70 years age or 30 years tenure whichever is earlier, in line with the guidelines issued by NHB vide their Circular NHB (ND)/ DRS/Pol.55/2012-13 dated April 16, 2013 and such extension is not treated as renegotiated or rescheduled account for the purpose of income recognition and asset classification norms.

12. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2014.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs. 658.65 lakh (Previous year Rs. 893.97 lakh) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs. 1210.42 lakh(Previous year Rs. 1566.11 lakh).

13. The Company has entered into lease cum licence agreement with M/s Theme Encore Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to Rs. 193.04 lakhs (Previous Year Rs. 99.88 lakhs towards partial implementation) is charged off to the P S-L account under Professional fees - IBS.

14. The Company has provided for 100% provision for Non-Performing assets, a sum of Rs. 355.69 Lakhs (Previous Year Rs. 823.81 Lakhs) representing excess provision has been withdrawn S-credited to Profit S-Loss Account.

15. Disclosure on Employee Benefits -AS 15 Revised

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated up to a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated up to a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

16. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the company''s primary business is of housing finance.

(B) Key Management Personnel:

Sri C.llango - Managing Director (From 29/04/11)

17. There are no penalties levied on the company by the National Housing Bank.

18. There are no adverse comments on the company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

19. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

20. Previous year figures have been rearranged / regrouped wherever necessary.


Mar 31, 2013

1.1 Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, Bank guarantees, Company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

1.2 Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2013.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs. 894 Lakhs (Previous year Rs. 1340 Lakhs) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs.1566 Lakhs (Previous year Rs. 2389 Lakhs).

1.3 As per the directions of NHB vide their letter – NHB (ND)/ DRS / Pol No. 45/2011-2012 dated January 19, 2012, the provision for Standard Assets in respect of commercial real estates is required to be at 1.00% and for other Standard Assets is required to be made at 0.40%. Accordingly the Company has made provision for Standard Assets as under.

2.1) Miscellaneous Expenses include provision for wealth Tax to extent of Rs.0.40 lakhs (Previous Year nil)

2.2) The Company has entered into lease cum licence agreement with M/s Theme Encore Ltd., for implementation of Integrated Business Suit (IBS) software. The expenditure incurred in this regard amounting to Rs. 99.88 Lakhs is charged off to the P & L account under Profession fees – IBS.

3. Disclosure on Employee Benefits – AS 15 Revised

Gratuity is an Employee Benefit payable on retirement / superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a maximum of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

4. Segment Reporting – There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the Company''s primary business is of housing finance.

5. The transactions with related parties as per Accounting Standard 18 "Related Party Disclosures” issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges are furnished below:

(B) Key Management Personnel:

Mr. C.Ilango - Managing Director (From 29/04/11)

6. There are no penalties levied on the Company by the National Housing Bank.

7. There are no adverse comments on the Company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

8. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

9. Previous year figures have been rearranged / regrouped wherever necessary.


Mar 31, 2012

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. Instalments Due from Borrowers (net of interest suspense) include RsNil (Previous year Rs2,07,05,775/-), whicn is outstanding for over six months on account of conversion of housing loan accounts from Annual Diminishing balance method to daily diminishing balance method.

3. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2012.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs 13.40 crore (Previous year Rs11.30 crore) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs 19.01 crore (Previous year Rs 23.48 crore).

After making 100% provision for non-performing assets, a sum of Rs3.61 crore representing the excess provision is withdrawn and credited to Profit S'' Loss account.

4. The company has securitised till date, housing loans to the extent of Rs212,88,14,120/- (Previous year Rs212,88,14,120/-) consisting of Class A PTCs of Rs157,48,69,266/-, which is subscribed by various Banks/ Financial Institutions and Class B PTCs of Rs55,39,44,854/-, which is held by the Company. The total securitised assets outstanding as on date is TNil (Previous year Rs3,92,18,489/-) consisting of Class A PTCs of RsNil (Previous year Rs85,10,079/-) and Class B PTCs of RsNil (Previous year Rs3,07,08,410/-).

5. Particulars of Provision for Standard Assets - 2011 -12.

As per the directions of NHB vide their letter - NHB/HFC.DIR/3/CMD/2011 dated August 05, 2011, the provision for Standard Assets is required to be made at 0.40%. (Previous year the provision was required for Standard Assets - Non Housing Loans only). Accordingly the Company has made provision for Standard Assets as under.

6. Creation of Floating Charge in favour of Public deposits.

As per the Directions of the National Housing Bank, the Company has created floating charge on Investments in Govt. Securities and Deposits in Commercial Banks in favour of depositors in a manner prescribed by the National Housing Bank.

7. During the year bad debts written off amounting to Rs2,80,94,105/-. (Previous year RsNil) are included in other Expenses for which full provision was existing in the books of the Company.

8. Disclosure on Employee Benefits - AS 15 Revised

Gratuity is an Employee Benefit payable on retirement/superannuation/resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year, which can be accumulated upto a maximum of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit, which an Officer/Employee is entitled to 15 days in a year, which can be accumulated upto a maximum of 270 days.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

9. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, adjustment to the deferred tax asset of 8,42,000/- (Previous year Rs75,07,000/-) has been made and is adjusted against provision for tax for the current year.

10. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the company''s primary business is of housing finance.

(B) KEY MANAGEMENT PERSONNEL:

Dr.K.K.Deb - Managing Director (upto 29.04.2011)

Mr.C.iiango - Managing Director (From 29.04.2011)

11. There are no penalties levied on the Company by the National Housing Bank.

12. There are no adverse comments on the Company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

13. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

14. During the year the Company has changed the policy of accounting for penal interest from cash system to accrual system. Had the Company followed the cash system, the profit for the year would have been lower by Rs1.73 crore.

15. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 2011

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The company has securitised till date, housing loans to the extent of Rs.212,88,14,120/- (Previous year Rs.212,88,14,120/-) consisting of Class A PTCs of Rs.157,48,69,266/-, which is subscribed by various banks/ Financial Institutions and Class B PTCs of Rs.55,39,44,854/-, which is held by the company. The total securitised assets outstanding as on date is Rs.3,92,18,489/- (Previous year Rs.6,90,20,084/-) consisting of Class A PTCs of Rs. 85,10,079/- (Previous year Rs.3,31,51,448/-) and Class B PTCs of Rs.3,07,08,410/- (Previous year Rs.3,58,68,636/-)

3. Deposit with banks includes Rs.0.39 crore (Previous year Rs.0.39 crore) given as collateral security for Mortgage Backed Securities.

4. Net Profit on sale of fixed assets amounting to Rs.60, 364/- (Profit) is included under other income during the current year. (Previous year Rs 33,327 /- Loss was shown under Miscellaneous Expenses.). Other income also includes Bad debts recovered Rs. 7,16,531/- (previous year NIL) .

5. Instalments Due from Borrowers (net of interest suspense) include Rs.2,07,05,775/ - (Previous year Rs.1,34,15,863 /-), which is outstanding for over six months.

6. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2011.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs.11.30 Crore (Previous year Rs.10.29 crore) against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs 23.48 Crore (Previous year Rs.22.46 Crore)

7. Particulars of Provision for Standard Assets- Non Housing Loans 2010-11.

As per the directions of NHB vide their letter NHB (ND)/DRS/DIR-18-07/1336/2007 dated 27.03.2007, the provision for Standard Assets – Non-Housing Loans is required to be made at 0.4% before 31st December 2007. Accordingly the Company has made provision for Standard assets on Non Housing loans as under.

8. Creation of Floating Charge in favour of Public deposits.

As per the Directions of the National Housing Bank, the Company has created floating charge on Investments in Govt. Securities and Deposits in Commercial Banks in favour of depositors in a manner prescribed by the National Housing Bank.

9. During the year, no bad debts were written off. (Previous year Bad debts written off amounting to Rs.61, 69,997/- were included in Miscellaneous Expenses).

10. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, adjustment to the deferred tax asset of Rs.75,07,000/- (Previous year Rs.60,00,000/-) has been made and is adjusted against provision for tax for the current year.

11. Segment Reporting – There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the company''s primary business is of housing finance.

12. The transactions with related parties as per Accounting Standard 18 "Related Party Disclosures" issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges, are furnished below:

(a) related Parties:

Canara Bank Sponsor Bank

Canbank Factors Ltd.

Canbank Computer Services Ltd.

Canara Robeco Asset Management Services Ltd.

Canbank Financial Services Ltd.

Subsidiaries of Canara Bank

Canbank Venture Capital Fund

Canara Bank Securities Ltd

Canara HSBC Oriental Bank of Commerce Life Insurance Company Ltd.

(B) Key Management Personnel:

Mrs Mythili Krishnamurthy – Managing Director (up to 15/06/2010)

Dr. K .K. Deb – Managing Director (From 15/06/2010)

13. There are no penalties levied on the company by the National Housing Bank.

14. There are no adverse comments on the company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

15. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

16. Previous year figures have been rearranged / regrouped wherever necessary.


Mar 31, 2010

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by :

(a) Equitable mortgage of property and / or

(b) Other securities, assignment of life insurance policies and / or

(c) Government guarantees, Bank guarantees, Company guarantees or Personal guarantees and / or

(d) Negative lien and / or

(e) Undertaking to create a security.

2. The Company has securitised till date, housing loans to the extent of Rs.212,88,14,120/- (Previous year Rs.212,88,14,120/-) consisting of Class A PTCs of Rs.157,48,69,266/-, which is subscribed by various banks / Financial Institutions and Class B PTCs of Rs.55,39,44,854/-, which is held by the Company. The total securitised assets outstanding as on date is Rs.6,90,20,084/- (Previous year Rs.18,25,82,769/-) consisting of Class A PTCs of Rs.3,31,51,448/- (Previous year Rs.6,40,49,280/-) and Class B PTCs of Rs.3,58,68,636/- (Previous year Rs.11,85,33,489/-).

3. Deposit with banks include Rs.0.39crore (Previous year Rs.1.92 crore) given as collateral security for Mortgage Backed Securities.

4. Net loss on sale of fixed assets amounting to Rs.33,327/- (loss) is included under Miscellaneous Expenses during the current year. (Previous year Rs.1,53,000/- profit). Other income includes interest received on Income Tax refund Rs.2,73,44,321/- on receipt of orders for various Assessment Years (Previous year - NIL).

5. instalments Due from Borrowers (net of interest suspense) include Rs.1,34,15,863/- (Previous year Rs.1,31,41,991/-), which is outstanding for over six months.

6. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2010.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs.10 .29 crore (Previous year Rs.11.77 crore) against which the Company, by way of prudence and abundant caution has maintained cumulative provision of Rs.22.46 crore (Previous year Rs.23.94 crore).

6. Creation of Floating Charge in favour of Public deposits.

As per the Directions of the National Housing Bank, the Company has created floating charge on Investments in Govt. Securities and Deposits in Commercial Banks in favour of depositors in a manner prescribed by the National Housing Bank.

7. Miscellaneous Expenses includes Net of Bad debts written off Rs.61,69,997/- i.e (Bad Debts Written off Rs.61,75,262/- - Bad Debt Recovery Rs.5,265/-) (Previous year Bad Debts written off is Rs.28,385/-)

8. Claims against the Company not acknowledged as debt:

9. Disclosure on Employee Benefits - AS 15 Revised Gratuity is an Employee Benefit payable on retirement/ superannuation / resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/ Employee is entitled to 30 days of PL every year which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit which an Officer / Employee is entitled to 15 days in a year.

Leave Fare Concession is an employee benefit wherein all confirmed Employees / Officers are entitled once in two years.

10. Segment Reporting – There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the Company’s primary business is of housing finance.

11. There are no penalties levied on the Company by the National Housins Bank.

12. There are no adverse comments on the Company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

13. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

14. Previous year figures have been rearranged / regrouped wherever necessary.


Mar 31, 2009

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and / or

(b) Other securities, assignment of life insurance policies and / or

(c) Government guarantees, Bank guarantees, Company guarantees or Personal guarantees and / or

(d) Negative lien and / or

(e) Undertaking to create a security.

2. The Company has securitised till date, housing loans to the extent of Rs.212,88,14,120/- (Previous year Rs.212,88,14,120/-) consisting of Class A PTCs of Rs.157,48,69,266/-, which is subscribed by various banks / Financial Institutions and Class B PTCs of Rs.55,39,44,854/-, which is held by the Company. The total securitised assets outstanding as on date is Rs.18,25,82,769./- (Previous year Rs.29,44,04,297/-) consisting of Class A PTCs of Rs.6,40,49,280/- (Previous year Rs.10,73,27,380/-) and Class B PTCs of Rs.11,85,33,489/- (Previous year Rs.18,70,76,917/-).

3. Deposit with banks include Rs.1.92 crores (Previous year Rs.1.92 crores) given as collateral security for Mortgage Backed Securities

4. Net profit on sale of fixed assets amounting to Rs 153000/- is included under other income during the current year. (During the previous year included under Fees and Other Charges amounting to Rs.1191/-).

5. Instalments Due from Borrowers (net of interest suspense) include Rs.1,31,41,991/- (Previous year Rs.2,82,15,725/-), which is outstanding for over six months.

6. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2009.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs.11.77 crores (Previous year Rs.11.00 crores) against which the Company, byway of prudence and abundant caution has maintained cumulative provision of Rs.23.94 crores (Previous year Rs.23.17 crorei).

7. Creation of Floating Charge in favour of Public deposits.

As per the Directions of the National Housing Bank, the Company has created floating charge on Investments in Govt. Securities and Deposits in Commercial Banks in favour of depositors in a manner prescribed by the National Housing Bank.

8. Miscellaneous Expenses includes Bad debts written off Rs.28,385/- (Previous year bad debts written off is Rs.24,89,206/-).

Miscellaneous Expenses also includes Bad Debts recovered Rs.14,91,208/- (Previous year Rs.1,05,167/-)

9. Disclosure on Employee Benefits - AS 15 Revised

Gratuity is an Employee Benefit payable on retirement / superannuation / resisnation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/ Employee is entitled to 30 days of PL every year which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit which an Officer / Employee is entitled to 15 days in a year

Leave Fare Concession is an employee benefit wherein all confirmed Employees / Officers are entitled once in two years.

10. There are no reported Micro, Small and Medium Enterprises as defined in the MSME Development Act, 2006 to whom the Company owes Money.

11. There are no amounts payable to any small-scale industrial undertakes.

12. There are no penalities levied on the Company by the National Housing Bank.

13. There are no adverse comments on the Company made in writing by the National Housing Bank on Regulatory compliance, which requires disclosure.

14. The Company has complied with requirements as per Para 29 of the Housing Finance Companies (NHB) Directions 2001.

15. Previous year figures have been rearranged / regrouped wherever necessary.


Mar 31, 2008

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, Company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The Company has securitised till date, housing loans to the extent of Rs.212,88,14,120/- (Previous year Rs.212,88,14,120/-) consisting of Class APTCs of Rs. 157,48,69,266/-, which is subscribed by various banks/ Financial Institutions and Class B PTCs of Rs.55,39,44,854/-, which is held by the Company. The total securitised assets outstanding as on date is Rs.29,44,04,297./- (Previous year Rs.45,60,43,314/-) consisting of Class A PTCs of Rs.10,73,27,380/- (Previous year Rs.20,74,76,878/-) and Class B PTCs of Rs.18,70,76,917I- (Previous year Rs.24,85,66,435/-).

3. Deposit with banks include Rs.1.92 crores (Previous year Rs.1.92 crores) given as collateral security for Mortgage Backed Securities

4. Net profit on sale of fixed assets amounting to Rs 1191/- is included under operating income viz. Fees and Other Charges, (previous year Rs.83,990/- being net profit on sale of fixed assets).

5. Instalments Due from Borrowers (net of interest suspense) include Rs.2,82,15,725-/- (Previous year Rs.83,53,370/-), which is outstanding for over six months.

6. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2008.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs. 11.00 crores (Previous year Rs.9.89 crores) against which the Company, by way of prudence and abundant caution has maintained cumulative provision of Rs.23.17 crores (Previous year Rs.22.07 crores).

7. Creation of Floating Charge in favour of depositors.

As per the Directions of the National Housing Bank, the Company during the current financial year has created floating charge on assets in favour of depositors in a manner prescribed by the National Housing Bank.

8. Miscellaneous Expenses includes Bad debts written off Rs.23,84,039/- net of recovery (Previous year bad debts written off is Rs.11,11,031/-)

9. Disclosure on Employee Benefits - AS 15 Revised

Gratuity is an Employee Benefit payable on retirement/superannuation/resignation on completion of 5 years of service.

Privilege Leave is an employee benefit wherein confirmed Officer/Employee is entitled to 30 days of PL every year which can be accumulated upto a max of 240 days.

Provident Fund is a statutory employee benefit wherein contributions are made by the employee and employer in prescribed proportion.

Sick Leave is a Benefit which an Officer/Employee is entitled to 15 days in a year.

Leave Fare Concession is an employee benefit wherein all confirmed Employees/Officers are entitled once in two years.

10. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, adjustment to the deferred tax asset of Rs. 1,30,00,000/- (Previous year Rs.31,00,000/-) has been made and is adjusted against provision for tax for the current year.

11. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the Companys primary business is of housing finance.

12. There are no reported Micro, Small and Medium Enterprises as defined in the MSME Development Act, 2006 to whom the Company owes Money.

13. There are no amounts payable to any small-scale industrial undertaking.

14. There are no penalities levied on the Company by the National Housing Bank.

15. There are no adverse comments on the Company made in writing by the National Housing Bank on Regulatory compliance which requires disclosure.

16. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 2007

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The company has securitised till date, housing loans to the extent of Rs.212,88,14,120/- (Previous year Rs.212,88,14,120/-) consisting of Class A PTCs of Rs.157,48,69,266/-, which is subscribed by various banks/ Financial Institutions and Class B PTCs of Rs.55,39,44,854/-, which is held by the company. The total securitised assets outstanding as on date is Rs.45,60,43,314/- (Previous year Rs.65,26,98,847/-) consisting of Class A PTCs of Rs.20,74,76,878/- (Previous year Rs.37,15,74,678/-) and Class B PTCs of Rs.24,85,66,435/- (Previous year Rs.28,11,24,169/-).

3. Deposit with banks include Rs.5.42 crores (Previous year Rs.5.42 crores) given as collateral security for Mortgage Backed Securities Rs.1.92 crores (Previous year Rs.1.92 Crores) and Rs.3r50 Crores pending release of charge against Debentures 2002 series.

4. The company raised Rs.50 crores during the financial year 2001 -2002 by issue of secured, redeemable non-convertible debentures @ 9.30% p.a., payable semi-annually. The debentures were redeemable at par in 3 instalments in the ratio of 30%, 30% and 40% at the end of 5th, 6th and 7th years respectively from the deemed date of allotment, i.e. 18th March 2002. Further, the debentures had a put/call option at the end of 5 years from the deemed date of allotment. Accordingly, the company exercised call option during the year and the entire amount of Rs.50 Crores was redeemed at par.

5. Other income relates to interest received on refund of income tax of Rs. NIL. (Previous year Rs.17,14,883/-). Rs.83,990/- being net profit on sale of fixed assets included under operating income viz. Fees and Other Charges.(previous year Rs.45,573/- being net loss on sale of fixed assets).

6. Instalments Due from Borrowers (net of interest suspense) include Rs.83,53,370/- (Previous year Rs.76,22,479/-), which is outstanding for over six months.

7. Recognition of income and provision for non-performing assets has been made in accordance with the guidelines on prudential norms applicable as of March 31, 2007.

Provision of loans is required to be maintained as per NHB guidelines on prudential norms to the extent of Rs.9.89 Crores (Previous year Rs. 10.09 crores), against which the company, by way of prudence and abundant caution has maintained cumulative provision of Rs.22.07 crores (Previous year Rs.16.76 crores).

8. Miscellaneous Expenses includes Bad debts written off Rs.11,11,031/-(Previous year bad debts recovery Rs. 22,41,516/- net of write off)

9. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, adjustment to the deferred tax asset of Rs.31,00,000/- (Previous year Rs.6,00,000/-) has been made and is adjusted against provision for tax for the current year.

10. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the companys primary business is of housing finance.

11. There are no amounts payable to any small scale industrial undertaking.

12. There are no penalties levied on the company by the National Housing Bank.

13. There are no adverse comments on the company made in writing by the National Housing Bank on Regulatory compliance which requires disclosure.

14. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 2006

1. Recognition of income and provision for non-performing assets have been made in accordance with the guidelines on prudential norms applicable as of March 31, 2006.

Provision of loans is required to be maintained as per NHB guidelines on Prudential norms to the extent of Rs.10.09 crores (Previous year Rs.10.34 crores) against which the company has maintained cumulative provision of Rs.16.76 crores (Previous year Rs.16.34 crores).

An analysis of interest derecognised and utilisation of provision is as under: -

(Rs in lakhs) Particulars Interest suspense Provision For the year For the year For the year For the year 2005-2006 2004-2005 2005-2006 2004-2005

a) Cumulative at the beginning of the year 1102.75 1348.93 1633.80* 1654.72

b) Less: Recovery/ adjustment during the year 631.42 567.61 389.34 373.40

c) Add: Additions made during the year 217.14 321.43 431.59** 352.48*

d) Cumulative at the end of the year (a)-(b)+(c) 688.47 1102.75 1676.05 1633.80

* Including additional provision of Rs.6.00 crores as on 31.03.2004.

** Including additional provision of Rs.0.67 crores as on 31.03.2006.

8. Bad debts recovery of Rs. 22,41,516/- (net of write off) is adjested against Miscellaneous expenditure. (Previous Year written off Rs. 1,98,210/-).

9. Claims against the company not acknowledged as debt;

A) Disputed tax Income tax appeals from the assessment year 1993- matters under 94 to 2003-2004 & Interest Tax appeals made by appeal: the company and the IT department from the assessment year 1996-97 to 2000-2001 are before 0 Incometax 871.76 443.09 various Appellate Athorities and certain appeals. are n) Interest tax 54.46 54.46 heard and orders passed in favour of the company.

926,22,497.55 An amount of Rs.316.50 lakhs (PYRs.316.50 lakhs) comprising of Rs.297.07 lakhs (PY Rs.297.07 lakhs) towards disputed Income Tax and Rs. 19.43 lakhs (PY Rs.19.43 lakhs) towards disputed Interest Tax has been provided in the books.

No provision has been made in respect of the balance amount of Rs.610.12 lakhs (PY Rs.181.05 lakhs) being;

a) Disputed Tax in respect of which Appeals have been already allowed in favour of the Company against which the Department has filed further Appeals-Rs.123.05 lakhs.

b) Disputed Tax in respect of Appeals filed by the Company yet to be heard and Order to be passed but on similar issues the Appeal of the Company have been allowed in Previous Years - Rs.58.00 lakhs

c) Interpretation of the quantum of benefit to be acurred u/s.36(i)(viii) of the Income TaxAct., 1961 of Assessment year 2003-04 of Rs.428.67 Lakhs and which are allowed in earlier years

B) Claims made 3.28 2.97 In most of the cases the company is only a for by borrowers mal party. In some cases the borrowers have of the company not performed their part of the contract. There before various is no liability on the company in these cases and Consumer hence no provision has been made.

Forums.

C) Claims made 7.16 Nil The Company does not recognize this claim as By Exemployees the eligibility criteria laid down by the Management is not met with. However, without prejudice to the rights of the company, and as a matter of abundant precaution, adequate provision has been made in the books.


Mar 31, 2005

1. Loans and instalments due from borrowers are secured/partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities/assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees/company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The company has securitised till date/housing loans to the extent of Rs.212,88,14/120/- (Previous year Rs.212/88/14,120/-) consisting of Class A PTCs of Rs.1/57/48/69/266/-, which is subscribed by various banks/Financial Institutions and Class B PTCs of Rs.55,39,44,854/- which is held by the company The total securitised assets outstanding as on date is Rs.90/36,90/790/- (Previous year Rs.125/85,47,585/-) consisting of Class A PTCs of Rs.58,29,55,981/- (Previous year Rs.87,52,56/885/-) and Class B PTCs of Rs.32,07,34,809/- (Previous yearRs.38,32,90,700/-).

3. Deposit with banks include Rs.5.42 crores (Previous year Rs.5.42 crores) given as collateral security for debentures and Mortgage Backed Securities (MBS).

4. The company raised Rs.50 crores during the financial year 2001 -2002 by issue of secured/redeemable non convertible debentures @ 9.30% p.a., payable semi-annually The debentures shall be redeemed at par in 3 instalments in the ratio of 30%, 30% and 40% at the end of 5th, 6th and 7th years respectively from the deemed date of allotment of 18th March 2002. Further, the debentures have a put/call option at the end of 5 years from the deemed date of allotment.

5. Other Income include net interest received on refund of income tax/interest tax of Rs.38/38,782/-(Previous year Rs.7/68/326/-) and Rs.72/067/- being net loss on sale of Fixed Assets (Previous year loss Rs.28,611/-).

6. Instalments Duefrom Borrowers (net of interest suspense) include Rs.2,01,58,499/- (Previous year Rs.1,60,42,031/-), which is outstanding for over six months.

7. Recognition of income and provision for non-performing assets have been made in accordance with the guidelines on prudential norms applicable as of March 31, 2005.

NHB has revised Guidelines on Prudential Norms, effective from March 31, 2005 according to which an asset becomes NPA if interest or instalment is overdue for 90 days (180 days as of March 04). Accordingly provision for loans is required to be maintained to the extent of Rs, 10.34 crores (Previous year Rs.10.55 crores) against which the company has maintained cumulative provision of Rs.16.34 crores (Previous year Rs.16.55 crores).

8. Auditorsremuneration

For the year ended For the year ended March 31, 2005 March 31, 2004 Rupees Rupees

Audit Fees (Including Branch Auditors fees) 3,88,785 3,11,040

Other Services (Certificates/ Tax Audit, etc./) 1,75,911 1,70,895

Out of Pocket Expenses 1,53,536 1,50,604

Total 7,18,232 6,32,539

9. Remuneration to Managing Director

For the year ended For the year ended March 31, 2005 March 31, 2004 Rupees Rupees

Salaries etc., 3,71,311 3,60,568

Provident Fund, Gratuity etc., 94,418 96,420

10. Earnings per share has been computed as below:

Profit after tax (Rs. in lakhs) 2112.38 2069.83

No. of shares (in lakhs) (b) 204.85 204.85

Basic earnings per share (a/b) 10.31 10.10

Diluted earnings per share (a/b) 10.31 10.10

11. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, addition to the deferred tax asset of Rs.35,00,000/- (Previous year Rs.17/00,000/-) has been made and is adjusted against provision for tax for the current year.

The tax effects of significant timing (temporary) differences that resulted in deferred tax assets and liabilities and description of the financial statement items that creates these differences are as follows:

(Rs. in lakhs) Particulars Cumulative as on Cumulative as on 31,3,2005 31,3,2004

Deferred Tax Assets:

Provision for Doubtful debts 259.00 226.00

Provision for Leave Encashment 16.00 12.00

Sub-Total (A) 275.00 238.00

Deferred Tax liability:

Depreciation on Assets 9.00 7.00

Sub-Total (B) 9.00 7.00

Cumulative Deferred Tax Asset 266.00 231.00

12. Particulars of dividend paid to Non-resident shareholders:

Year to which the dividend relates 2003-2004 2002-2003

No of Shareholders 19 16

No of Shares held 27,883 27,750

Gross amount of Dividend (Rupees) 69,708 69,375

13. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the companys primary business is of housing finance.


Mar 31, 2004

1. Loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The company securitised housing loans during the year to the extent of Rs.64,12,69,566/- (Previous year Rs.85,35,45,592/-) consisting of Class A PTCs of Rs.54,44,82,400/- (Previous year Rs.58,19,09,666/-) which is subscribed by various banks/Financial Institutions and Class B PTCs of Rs.9,67,87,166/-, (Previous year Rs.27,16,35,926/-) which is held by the company. The total securitised assets outstanding as on date is Rs. 125,85,47,585/- (Previous year Rs. 103,70,72,848/-) consisting of Class A PTCs of Rs.87,52,56,885/- (Previous year Rs.67,41,62,072/-) and Class B PTCs of Rs.38,32,90,700/- (Previous year Rs.36,29,10,776/-).

3. Deposit with banks include Rs.5.42 crores (Previous year Rs.5.03 crores) given as collateral security for debentures and Mortgage Backed Securities (MBS).

4. The company raised Rs.50 crores during the financial year 2001-2002 by issue of secured, redeemable non convertible debentures @ 9.30% p.a., payable semi-annually. The debentures shall be redeemed at par in 3 instalments in the ratio of 30%, 30% and 40% at the end of 5th, 6th and 7th years respectively from the deemed date of allotment of 18th March 2002. Further, the debentures have a put/call option at the end of 5 years from the deemed date of allotment.

5. The outstanding, as on the date of Balance Sheet in rupee terms, in respect of term loans availed from Banks and converted to Foreign Currency Loan to Resident Constituents - TL (FCLR-TL) is Rs.153.22 crores (Previous year - Rs. 102.33 crores). Forward contract has been booked in respect of the principal repayment and the interest/premium payable in respect of FCLR loan is recognised over the period of contract.

6. Other Income include net interest received on refund of income tax/interest tax of Rs.7,68,326/- (Previous year Rs.49,11,721/-) and Rs.28,611/- being net loss on sale of Fixed Assets (Previous year loss Rs.1295/-).

7. Instalments Due from Borrowers (net of interest suspense) include Rs.1,60,42,031/- (Previous year Rs.1,60,83,295/-), which is outstanding for over six months.

8. Interest on non-performing assets is to be recognised as per the prudential norms of NHB. Accordingly, an analysis of interest derecognised is as under: -

(Rs in lakhs) Particulars For the year For the year 2003-2004 2002-2003

(a) Cumulative interest derecognised at the beginning of the year 1560.09 1597.95

(b) Less: Recovery/adjustment of interest derecognised during the year 392.30 237.92

(c) Add: Interest derecognised for the current year 181.14 200.06

(d) Cumulative interest derecognised at the end of the year ( a) - (b) + (c) 1348.93 1560.09

9. Provision for non-performing assets have been made in accordance with the guidelines on prudential norms issued by National Housing Bank (NHB) applicable as of March 31, 2004.

NHB has revised Guidelines on Prudential Norms, effective from March 31, 2005 according to which an asset becomes NPA if interest or instalment is overdue for 90 days (180 days as of March 04). Further, an asset, becomes sub-standard/doubtful at a faster rate as per revised norms compared to the prevailing norms which necessitates higher quantum of provision w.e.f. 31.3.2005 as compared to existing norms. As suggested by NHB to strengthen the Balance Sheet and facilitate smooth transition to revised norms, as a prudent measure, an additional provision for housing loans has been made to the extent of Rs.4 crores out of which Rs.3 crores is by withdrawing from General Reserve II. Further, Rs.2 crore additional provision has been made towards loans to Corporate Bodies.

10. Miscellaneous Expenses include Bad debts written off of Rs.86,40,458/- (Previous Year Rs.28,34,760/-) and debenture issue expenses of Rs. Nil (Previous Year-Rs.9,78,110/-).

11. Auditors remuneration For the year ended For the year ended March 31, 2004 March 31, 2003 Rupees Rupees

Audit Fees (Including Branch Auditors fees) 3,11,040 2,89,800

Other Services (Certificates, Tax Audit, etc.,) 1,70,895 1,48,050

Out of Pocket Expenses 1,50,604 1,13,641

Total 6,32,539 5,51,491

12. Remuneration to Managing Director

For the year ended For the year ended March 31, 2004 March 31, 2003 Rupees Rupees

Salaries etc., 3,60,568 3,83,986

Provident Fund, Gratuity etc., 96,420 1,63,835

13. Earnings per share has been computed as below:

Profit after tax (Rs. in lakhs) (a) 2069.83 2158.48

No. of shares (in lakhs) (b) 204.85 204.85

Basic earnings per share (a/b) 10.10 10.54

Diluted earnings per share (a/b) 10.10 10.54

14. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, addition to the deferred tax asset of Rs. 17,00,000/- (Previous year Rs.33,00,000/-) has been made and is adjusted against provision for tax for the current year.

15. Segment Reporting - There are no separate reportable segments as per Accounting Standard on Segment Reporting (AS-17) as the companys primary business is of housing finance.

16. The transactions with related parties as per Accounting Standard 18 "Related Party Disclosures" issued by the Institute of Chartered Accountants of India and as required under the Listing Agreement with Stock Exchanges, are furnished below:

(A) Related Parties:

Canara Bank - Sponsor Bank

Subsidiaries of Canara Bank

Canbank Factors Ltd.

Canbank Computer Services Ltd,

Canbank Investment Management Services Ltd,

Canbank Financial Services Ltd.

Canbank Venture Capital Fund

Gilt Securities Trading Corporation Ltd.

(B) Key Management Personnel:

Sri.Peter D FCardozo - Managing Director

17. There are no amounts payable to any small scale industrial undertaking.

18. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 2003

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The Company securitised housing loans during the year to the extent of Rs.85,35,45,592/- (Previous year Rs.63,39,98,962/-) consisting of Class A PTCs of Rs.58,19,09,666/- (Previous year Rs.44,84,77,200/-) which is subscribed by various banks/Financial Institutions and Class B PTCs of Rs.27,16,35,926/-, (Previous year Rs.18,55,21,762/-) which is held by the Company The total securitised assets outstanding as on date is Rs.103,70,72,848/- (Previous year Rs.48,32,02,457/-) consisting of Class A PTCs of Rs.67,41,62,072/- (Previous year Rs.32,85,61,149/-) and Class B PTCs of Rs.36,29,10,776/- (Previous year Rs.15,46,41,308/-).

3. The Company raised Rs.50 crores during the financial year 2001-2002 by issue of secured, redeemable non convertible debentures @ 9.30% p.a., payable semi-annually The debentures shall be redeemed after 7 years in the ratio of 30%, 30% and 40% at the end of 5th, 6th and 7th years respectively from the deemed date of allotment of 18th March 2002. Further, the debentures have a put/call option at the end of 5 years from the deemed date of allotment.

4. During the year some of the term loans availed from Banks were converted to Foreign Currency Loan to Resident Constituents - TL (FCLR-TL) and the outstanding, as on the date of Balance Sheet in rupee terms is Rs.102.33 crores (Previous year - Nil). Forward contract has been booked in respect of the principal repayment and the interest/premium payable in respect of FCLR loan is recognised over the period of contract.

5. Other Income include net interest received on refund of income tax/interest tax of Rs.49,11,721/-(Previous year Rs.45,17,476/-) and Rs.1,295/- being net loss on sale of Fixed Assets (Previous year Profit Rs.3,33,869/-).

6. Instalments Due from Borrowers (net of interest suspense) include Rs.1,60,83,295/- (Previous year Rs. 1,64,77,028/-), which is outstanding for over six months.

7. Interest on non-performing assets is to be recognised as per the prudential norms of NHB. Accordingly, an analysis of interest derecognised is as under:-

(Rs in Lakhs) Particulars For the year For the year 2002-2003 2001-2002

(a) Cumulative interest derecognised at the beginning of the year 1597.95 1404.53

(b) less : Recovery/adjustment of interest derecognised during the year 237.92 102.74

(c) Add : Interest derecognised for the current year 200.06 296.16

(d) Cumulative interest derecognised at the end of the year (a) - (b) + (c) 1560.09 1597.95


Mar 31, 2002

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. The company securitised housing loans for the first time during the year to the extent of Rs. 63,39,98,962/- (outstanding as on date of Balance Sheet Rs. 48,32,02,457/-) consisting of Class A PTCs of Rs. 44,84,77,200/- (outstanding as on date of Balance Sheet Rs. 32,85,61,149/-), which is subscribed by various banks/Financial Institutions and Class B PTCs of Rs. 18,55,21,762/- (outstanding as on date of Balance Sheet Rs. 15,46,41,308/-), which is held by the company.

3. The company raised Rs. 50 crores during the year by issue of secured, redeemable non convertible debentures @ 9.30% p. a., payable semi-annually. The debentures shall be redeemed after 7 years in the ratio of 30%, 30% and 40% at the end of 5th, 6th and 7th years respectively from the deemed date of allotment of 18th March 2002. Further, the debentures have a put/call option at the end of 5 years from the deemed date of allotment.

4. Other Income include Rs. 3,33,869/- being Profit on sale of Fixed Assets (Previous year Profit Rs. 12,540/-) and interest on refund of income tax Rs. 45,17,476/- (Previous year Rs. 2,22,238/-).

5. Instalments Due from Borrowers (net of interest suspense) include Rs. 27,89,378/- (Previous year Rs. 37,92,773/-), which is outstanding for over six months.

6. Miscellaneous Expenses include debenture issue expenses of Rs. 18,27,000/- (Previous Year - Nil) and Bad debts written off of Rs. 1,09,91,533/- (Previous Year Rs. 50,23,499/-).

7. As the disputed Income/Interest Tax liability are under various stages of appeal, the company as a measure of abundant precaution has made a provision of Rs. 3,00,00,000 (Previous year - Nil) against a contingent liability of Rs. 4,90,35,560/- (Previous year Rs. 4,48,24,262/-) and no provision has been made for claims against the Company not acknowledged as debt of Rs. 4,18,997/- (previous year Rs. 3,23,649/-).

8. In view of Accounting Standard 22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, a deferred tax asset has been created on the opening balance to the extent of Rs. 1,47,00,000/- which is credited to general reserve. During the year addition to the deferred tax asset of Rs. 34,00,000/- has been made and is adjusted against provision for tax for the current year.


Mar 31, 2001

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

2. Other Income includes Rs.12,540/- being Profit on sale of Fixed Assets (Previous year Profit Rs.1,25,349/-) and interest on refund of income tax Rs.2,22,238/-(Previous year Rs.35,61,180/-).

3. Instalments Due from Borrowers (net of interest suspense) include Rs. 37,92,773/- (Previous year Rs.1,10,93,311/-), which is outstanding for over six months.

4. As Interest Tax has been withdrawn, no provision is required to be made. (Previous year Interest on Housing Loan and other interest income have been determined after adjusting interest tax of Rs. 1,60,00,000/-).

5. Miscellaneous Expenses includes Rs.50,23,499/- being Bad debts written off (Previous Year Rs.16,91,038/-).

9. No provision has been made for disputed Income/Interest Tax liability under appeal Rs.4,48,24,262/- (Previous year Rs.2,72,86,957/-) and for Claims against the Company not acknowledged as debt Rs.3,23,649/- (previous year Rs. 5,89,775/-).

10. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 2000

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by :

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

These include : Maximum amount due As at March As at March during the year 31, 2000 31, 1999 Rs. Rs. Rs.

Amount due from Officers of the

Company against housing loans -- -- --

2. Other Income includes Rs. 1,25,349/- being Profit on sale of Fixed Assets (Previous year Profit Rs.35,246/-) and interest on refund of income tax Rs.35,61,180/- (Previous year Rs.5,99,933/-).

3. As per the Prudential Norms prescribed by National Housing Bank, the net interest income of Rs.3,80,25,376/-(Previous year Rs.2,96,99,830/-) has not been recognised and additional provision made of Rs.60,47,739/-(Previous year Rs.1,67,29,478/-) in respect of doubtful debts.

4. Interest on Housing Loans and other interest income have been determined after adjusting Interest Tax of Rs. 1,60,00,000/-(Previous year Rs.1,35,00,000/-).

5. Miscellaneous Expenses includes Rs. 16,91,038/- being Bad debts written off (Previous Year Nil).

6. No provision has been made for disputed Income Tax liability under appeal Rs.2,72,86,957/- (Previous year Rs.2,47,84,200/-) and for Claims against the Company not acknowledged as debt Rs.5,89,775/- (Previous year Rs. 5,48,278/-).


Mar 31, 1999

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by :

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

These include : Maximum amount due As at March As at March during the year 31, 1999 31, 1998 Rupees Rupees Rupees

Amount due from Officers of the Company against housing loans 6,452 - 6,452

2. As per the Prudential Norms prescribed by National Housing Bank, the interest income of Rs.2,96,99,830/- (Previous year Rs.2,99,57,458/-) has not been recognised and additional provision made of Rs.1,67,29,478/- (Previous year Rs.1,47,40,877/-) in respect of doubtful debts.

3. Staff Training and Welfare Expenses includes Rs.23,68,000/- (Previous year Nil) being provision for leave encashment as per the policy of the Company but for which the profit would have been higher by similar amount.

4. No provision has been made for disputed Income Tax liability under appeal Rs.2,47,84,200/- (Previous year Rs.1,56,72,342/-).

5. The Management has identified the Year 2000 issue in respect of various software and hardware used by it and has carried out the remedial measures with adequate resources, maintenance strategy and contingency plan to ensure that the organisation is Y2K complaint and accordingly the problem of Y2K will not vitiate assumption of a going concern.


Mar 31, 1998

1. Housing loans and installments due from borrowers are secured, partly secured or otherwise by :

(a) Equitable mortgage of property and/or (b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or (c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or (d) Negative lien and/or (e) Undertaking to create a security.

2. As per the Prudential Norms prescribed by National Housing Bank, the interest income of Rs. 2,99,57,458/- (Previous year Rs. 76,78,725/-) has not been recognised and additional provision made of Rs. 1,46,99,073/- (Previous year withdrawn Rs. 5,91,047/-) in respect of doubtful debts.


Mar 31, 1997

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

These include:

Maximum amount due As at March As at March during the year 31, 1997 31, 1996 Rupees Rupees Rupees

Amount due from Officers of the Company against housing loans 2,68,231 NIL 2,68,231

2. As per the Prudential Norms prescribed by National Housing Bank, the interest income of Rs. 76,78,725 has not been recognised and excess provision made in earlier years have been withdrawn of Rs. 5,91,047 in respect of doubtful debts. But for this, the profit for the year would have been higher by Rs. 70,87,678.

3. Other Income includes Rs. 13,370 being Loss on sale of Fixed Assets (Previous year Profit Rs. 6,02,517) and Rs. 31,25,019 (Previous Year Rs. Nil) being interest on refund of income tax.

4. Investments are of Long Term in nature and are therefore disclosed at cost as per National Housing Bank guidelines.

5. Interest on Housing Loans and other interest income have been determined after adjusting Interest Tax of Rs. 1,16,00,000 (Previous Year Rs. 83,50,000).

6. No provision has been made for disputed Income Tax liability under appeal Rs. 1,56,72,342 (Previous Year Rs. Nil).

10. Pursuant to the legal opinion obtained, the Company qualifies for exemption under Section 370(2)(a)(v) of the Companies Act, 1956 and accordingly the provisions of Section 370 are not applicable to the Company in respect of loans and deposits given to bodies corporate


Mar 31, 1996

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

These include:

Maximum amount due As at As at during the year March 31, March 1996 31, 1995 Rupees Rupees Rupees

Amount due from Officers of the Company against housing loans 5,19,253 2,68,231 2,43,170

2. As per the Prudential Norms made mandatory by National Housing Bank as on 31st March 1996, the interest income of Rs. 1,31,74,389 has not been recognised and additional provision made of Rs. 1,00,18,313 in respect of doubtful debts. But for this, the profit would have been higher by Rs. 2,31,92,702.

3. Other Income includes Rs. 6,02,517 (Previous Year - Rs.4,05,986) being Profit on sale of Fixed Assets and Rs. Nil (Previous Year Rs. 38,39,163) being interest on refund of excess income tax paid.

4. Investments are of Long Term in nature and are therefore disclosed at cost as per National Housing Bank guidelines.

5. Interest on Housing Loans and other interest income have been determined after adjusting Interest Tax of Rs. 83,50,000 (Previous Year Rs. 68,00,000).

6. Expenditure in Foreign Currency

For the year For the year ended ended March 31,1996 March 31,1995 Rupees Rupees

Foreign Travel 86,670 42,121

Foreign Exhibition 1,27,830 - -------- ------ Total 2,14,500 42,121 ======== ======

7. Auditors' remuneration For the year For the year ended ended March 31,1996 March 31,1995 Rupees Rupees

Audit Fees 1,40,000 1,40,000

Other Services (Certificates, Tax Audit, etc.) 44,500 59,000

Out of Pocket Expenses 56,169 83,681 -------- -------- 2,40,669 2,82,681 ======== ========

8. a) Remuneration of Managing Director on deputation from Canara Bank For the year For the year (including amount reimbursed/ ended ended reimbursable) March 31,1996 March 31, 1995 Rupees Rupees

Salaries etc., 1,76,459 1,62,241

Provident Fund etc., 9,673 57,703

9. Pursuant to the legal opinion obtained, the Company qualifies for exemption under Section 370(2)(a)(v) of the Companies Act, 1956, and accordingly the provisions of Section 370 are not applicable to the Company in respect of loans and deposits given to bodies corporate.

10. Particulars of dividend paid to Non-resident shareholders are as under:

Year to which the dividend relates 1994-95 1993-94

No. of Shareholders 4 4

No. of Shares held 1,700 1,700

Gross amount of Dividend (Rupees) 3,400 3,060

11. Previous year figures have been rearranged/reqrouped wherever necessary.


Mar 31, 1995

1.Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

(a) Equitable mortgage of property and/or

(b) Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

(c) Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

(d) Negative lien and/or

(e) Undertaking to create a security.

These include: Maximum amount due As at As at during the year March 31,1995 March 31. 1994 Rupees Rupees Rupees

Amount due from an Officer of the Company against housing loan 2,59,167 2,43,170 2,59,167

2. Contingent Liability in respect of guarantees provided by the Company amounts Rs. NIL (Previous Year Rs. 26,72,736).

Other Income includes Rs.38,39,163 (Previous Year - Rs.8,08,680) being interest on refund of excess income tax paid and Rs.4,05,986 (Previous Year - Rs.3,99,842) being profit on sale of fixed assets.

Interest on Housing Loans and other interest income have been determined after using Interest Tax of Rs. 68,00,000 (Previous Year Rs. 48,50,000).

b) Shareholders' approval is proposed to be obtained in the ensuing Shareholders' Annual General Meeting for the appointment of Mr V.G. Baliga as Managing Director for the period from November 28, 1994 to January 31, 1997 and the remuneration paid/payable to him Rs. 70,267, which is in accordance with the service regulations of Canara Bank, is within the limits prescribed in Schedule XIII to the Companies Act, 1956.

8. Pursuant to the legal opinion obtained, the Company qualifies for exemption under Section 370(2)(a)(v) of the Companies Act, 1956, and accordingly the provisions of Section 370 are not applicable to the Company in respect of loans and deposits given to bodies corporate.

9. Particulars of dividend paid to Non resident shareholders are as under:

Year to which the dividend relates 1993-94 1992-93

No of Shareholders 4 2 No of Shares held 1,700 10,00,600 Gross amount of Dividend (Rupees) 3,060 16,00,960

10. Previous year figures have been rearranged/regrouped wherever necessary.


Mar 31, 1994

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

a. Equitable mortgage of property and/or b. Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

c. Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

d. Negative lien and/or

e. Undertaking to create a security.

2. Other income includes Rs.8,08,680 (Previous Year Rs.26,285) being interest on refund of excess advance tax paid and Rs.3,99,842 (Previous Year Rs.1,09,187) being profit on sale of fixed assets.

3. Reimbursement of expenses to Canara Bank have been included under respective heads of accounts in the Profit and Loss Account.

Expenditure in Foreign Currency -Foreign Travel Rs.1,67,204 -Foreign Exhibition Rs.1,29,508

8. Pursuant to the legal opinion obtained, the Company qualifies for exemption under Section 370(2)(a)(v) of the Companies Act, 1956, and accordingly the provisions of Section 370 are not applicable to the Company in respect of loans and deposits given to bodies corporate.


Mar 31, 1993

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by:

a. Equitable mortgage of property and/or b. Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

c. Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

d. Negative lien and/or

e. Undertaking to create a security.

2. Other income includes Rs.26,285 (Previous Year Rs.7,95,753) been interest on refund of excess advance tax paid and Rs.1,09,187 (Previous Year Rs.84,450) being profit on sale of fixed assets.

3. Reimbursement of expenses to Canara Bank have been included under respective heads of accounts in the Profit and Loss Account.

Expenditure in Foreign Currency Subscription to Magazines, etc. Rs.5,400.

8. Pursuant to the legal opinion obtained, the Company qualifies for exemption under Section 370(2)(a)(v) of the Companies Act, 1956, and accordingly the provisions of Section 370 are not applicable to the Company in respect of loans and deposits given to bodies corporate.


Mar 31, 1992

1. Housing loans and instalments due from borrowers are secured, partly secured or otherwise by: a. Equitable mortgage of property and/or

b. Pledge of shares, units of Unit Trust of India, other securities, assignment of life insurance policies and/or

c. Government guarantees, bank guarantees, company guarantees or personal guarantees and/or

d. Negative lien and/or e. Undertaking to create a security.

Other Income includes Rs.7,95,753 (Previous Year Nil) being interest on refund of excess advance tax paid and Rs.84,450 (Previous Year Rs.19,323) being profit on sale of fixed assets.

Advances Recoverable in Cash or in Kind or for value to be received include Rs.14,91,599 (Previous Year Rs.32,48,823) towards purchase of flats etc.

No provision for gratuity in respect of the Company's employees has been made in the accounts as none of the employees have completed 5 years of service.

Expenditure in Foreign Currency Subscription to Magazines, etc. Rs.3,910.


Mar 31, 1991

Housing loans are secured or partly secured by

a. Equitable mortgage of proporty or b. Pledge od shares/units, bank guarantees, company guarantees or personal guarantees. c. Negative lien or d. Undertaking to create a security.

Other income includes Rs.19,323 being profit on sale of fixed assets.

Advances Recoverable in cash or kind or for value to be received include Rs.32,48,823 (Previous year Rs.27,61,500) towards purchase of flats etc.

No provision for gratuity in respect of the company's employees has been made in the accounts as none of the employees have completed 5 years of service.

The company's application to the company law board for preparing the accounts in the present order is pending allotment.


Mar 31, 1990

Housing loans are secured by equitable mortgage or otherwise except in certain cases where these are secured by third party guarantees pending compliances with certain formalities of execution of security documents etc.

The accounts of the previous period was for 6 months while those of the current year is for 12 months, accordingly the figures are not comparable.

Other income includes Rs.3,72,330 being interest on refund of excess advance tax paid and Rs.3,283 being profit on sale of fixed assets.

No provision for gratuity in respect of the company's employees has been made in the accounts as none of the employees have completed 5 years of service.

Expenditure in foreign currency Subscription to Magazines-Rs.1,215.


Mar 31, 1989

Housing loans are secured by equitable mortgage of property or otherwise except in certain cases where these are secured by personal guarantees of the borrowers pending compliances with certain formalities of execution of security documents.

No provision for gratuity has been made since none of the employees have completed 5 years of service.

Expenditure in Foreign Currency Foreign Travel Rs.37,000 Subscription to Magazines, etc. Rs. 1,079

The company proposes to amend the objects clause of the MOA the ensuing AGM so as to enable the central board of direct taxes to grant approval under section 36(1)(viii) of the Income Tax Act 1961, for which application has already been made. Assuming that the aforesaid mentioned will be given with retrospective effect, the liability for income tax has been calculated after considering the deduction available under section 36(1)(viii) of the Income Tax Act as applicable to a housing finance company, resulting in a reduction in provision for tax liability of Rs.8,77,000 approximately.

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