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Notes to Accounts of Dolphin Offshore Enterprises (India) Ltd.

Mar 31, 2023

Contingent liabilities

(1) Pursuant to its order dated 05th October, 2021 ("NCLT Order”), after the payment of the dues to Creditors, Unsecured Creditors, Secured Operational Creditors, as per the Resolution Plan all the liabilities of the said stakeholders shall stand permanently extinguished as per the approved Resolution Plan. Any other claims including Government/ Statutory Authority, whether lodged during CIRP or not and any contingent/unconfirmed dues shall also stand extinguished.”

(2) Against the NCLT Order dated 05th October, 2021, Employee union has gone against the order and demanded their P.F. Dues. Accordingly the company has not extinguished PF Liabilities. However their actual liabilities will be confirmed once judgement is received.

SEGMENT REPORTING

As per para 4 of Ind AS 108 "Operating Segments”, if a single financial report contains both consolidated financial statements and the separate financial statements of the Parent Company, segment information may be presented on the basis of the consolidated financial statements. Thus, the information related to disclosure of operating segments required under Ind AS 108 "Operating Segments”, is given in Consolidated Financial Statements.

- DISCLOSURES AS REQUIRED BY INDIAN ACCOUNTING STANDARD (IND AS) 19 EMPLOYEE BENEFITS

Since there are no employeess, the Company has not made provision for gratuity and leave encashment for the year. In the absence of such valuation, relevant disclosures as per Ind AS-19 Employee Benefits have not been given. .

- CORPORATE SOCIAL RESPONSIBILITY

Pursuant to the provisions of section 135(5) of the Companies Act, 2013 (the Act), As per the relevant provisions of the Act read with Rule 2(1)(f) of the Companies (Corporate Social Responsibility Policy) Rules, 2014, the Company is required to spend at least 2% of the average net profits (determined under section 198 of the Companies Act 2013) made during the immediately three financial years.

(i) The above related party transactions have been reviewed periodically by the Board of Directors of the Company visa-vis the applicable provisions of the Companies Act, 2013, and justification of the rates being charged/ terms thereof and approved the same.

ii) Entity under common control are disclosed only transaction has taken place during the year.

iii) All related party transaction have been taken at arm’s length price.

* Pursuant to NCLT Order the existing Board will be replaced by new Board of Directors constituted with adequate representation from the member of Resolution Applicant Group and independent directors in compliance with Applicable Laws. Hence, all such Board Member and their relatives ceased to be related parties from 15th December, 2022, as per company’s corporate announcement dated January 21, 2023.

FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Company’s Risk Management framework encompasses practices relating to the identification, analysis, evaluation, treatment, mitigation and monitoring of the strategic, external and operational controls risks to achieving the Company’s business objectives. It seeks to minimize the adverse impact of these risks, thus enabling the Company to leverage market opportunities effectively and enhance its long-term competitive advantage. The focus of risk management is to assess risks and deploy mitigation measures.

The Company’s activities expose it to variety of financial risks namely market risk, credit risk and liquidity risk. The Company’s has mainly financial assets comprises of trade receivables (directly related to the business operations) and cash and bank balances. The Company’s principal financial liabilities comprise of loan and trade payable. The Company’s senior management’s focus is to foresee the unpredictability and minimize potential adverse effects on the Company’s financial performance. The Company’s overall risk management procedures to minimize the potential adverse effects of financial market on the Company’s performance are outlined hereunder:

The Company’s Board of Directors have overall responsibility for the establishment and oversight of the Company’s risk management framework.

The Company’s risk management is carried out by the management in consultation with the Board of Directors. They provide principles for overall risk management, as well as policies covering specific risk areas.

The note explains the sources of risk which the entity is exposed to and how the entity manages the risk.

(A) Credit risk

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers and from its financial activities including deposits with banks and other financial instruments.

(i) Cash and cash equivalents:

The Company considers factors such as track record, size of institution, market reputation and service standard to select the banks with which deposits are maintained. The Company does not maintain significant deposit balances other than those required for its day to day operations. Credit risk on cash and cash equivalents is limited as these are generally held or invested in deposits with banks and financial institutions with good credit ratings.

(B) Liquidity Risk

Liquidity risk is the risk that the Company will face in meeting its obligations associated with its financial liabilities. The Company’s approach in managing liquidity is to ensure that it will have sufficient funds to meet its liabilities when due without incurring unacceptable losses. In doing this, management considers both normal and stressed conditions.

The Company’s objective is to maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company relies on a mix of borrowings, capital and excess operating cash flows to meet its needs for funds. The current committed lines of credit are sufficient to meet its short to medium term expansion needs. The Company monitors rolling forecasts of its liquidity requirements to ensure that it has sufficient cash to meet operational needs.

The table below provides undiscounted cash flows towards non-derivative financial assets/ (liabilities) into relevant maturity based on the remaining period at the Balance Sheet date to the contractual maturity date and where applicable, their effective interest rates.

As the company was under CIRP process, data was not maintained properly hence we are unable to report the maturity profile of liabilities outstanding as on March 31, 2022

(C) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices.Market risk comprises three types of risks : foreign currency risk, interest risk and other price risk such as commodity risk.

(i) Interest rate risk

The Company’s exposure to the risk of changes in market interest rates relates primarily to debts having floating rate of interest. Its objective in managing its interest rate risk is to ensure that it always maintains sufficient headroom to cover interest payment from anticipated cashflows which are regularly reviewed by the Board.

As the company was under CIRP process, data was not maintained properly hence we are unable to report the Interest rate risk of financial liabilities outstanding as on March 31, 2022. In accordance with NCLT Order Resolution applicant has discharged all dues in accordance with resolution plan.

(ii) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates and arises where transactions are done in foreign currencies. It arises mainly where receivables and payables exist due to transactions entered in foreign currencies. The Company evaluates exchange rate exposure arising from foreign currency transactions and follows approved policy parameters utilizing forward foreign exchange contracts whenever felt necessary. The Company does not enter into financial instrument transactions for trading or speculative purpose.

(iii) Commodity Risk:

The Company is exposed to the movement in the price of key raw materials and other traded goods in the domestic and international markets. The Company has in place policies to manage exposure to fluctuation in prices of key raw materials used in operations. The Company enters into contracts for procurement of raw materials and traded goods, most of the transactions are short term fixed price contracts and a few transactions are long term fixed price contracts.

(D) Capital management

The Company manages its capital to be able to continue as a going concern while maximising the returns to shareholders through optimisation of the debt and equity balances. For the purpose of calculating gearing ratio, debt is defined as non current and current borrowings (excluding derivatives). Equity includes all capital and reserves of the Company attributable to equity holders of the Company. The Company is not subject to externally imposed capital requirements. The Board reviews the capital structure and cost of capital on an annual basis but has not set specific targets for gearing ratios. The risks associated with each class of capital are also considered as part of the risk reviews presented to the Board of Directors.

Note 40

The Company does not have any transactions with companies struck - off under Section 248 of the Companies Act, 2013 or Section 560 of Companies Act, 1956.

Note 41

Balances of Other Current Liabilities, Trade Receivables and Trade Payables are subject to confirmation, reconciliation and adjustments if any.

Note 42

In the opinion of the Management, current assets have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated except where indicated otherwise.

Note 43

Previous period figures have been regrouped, re-classified and re-arranged wherever considered necessary to confirm to the current year’s classification.

Note 44

The MCA wide notification dated March 24, 2021 has amended Schedule lll to the Companies Act, 2013 in respect of certain disclosures. The Company has incorporated appropriate changes in the above results.

Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits together with business developments. As The Company is recently acquired through NCLT Scheme, Management is in process of assessing the future profitability hence DTA on the existing unabsorbed losses has not been created.

Note 46 -

Additional information as required under para 2 of General Instruction of Division II of Schedule III to the Companies Act, 2013.

A. The Company has not carried out any revaluation of Property, Plant and Equipment in any of the period reported in this Financial Statements hence reporting is not applicable.

B. The company does not hold any benami property as defined under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder. No proceeding has 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

C. The Company does not have any such trasaction which is not 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 ( Such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

D. The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of

the company (Ultimate Beneficiaries) or(b) provide any guarantee, security or the like to or on behalf of the Ultimate

Beneficiaries

E. The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

(a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of

the Funding Party (Ultimate Beneficiaries) or(b) provide any guarantee, security or the like on behalf of the Ultimate

Beneficiaries,

F. All charges are satisifed in accordance with NCLT order, and company is in process of filing necessary documents with approriate authority.

G. The Company has not traded or invested in crypto currency or virtual currency during the financial year.

H. The Company is in compliance with the number of layers prescribed under clause (87) of section 2 of the Companies Act

read with the Companies ( Restriction on number of Layers) Rules, 2017.

I. During the company, pursuant to NCLT Order company has raised funds by way of issue of equity shares 47. Brief note on NCLT. Order.

1. Based on the petition filed by a financial creditor, the Hon’ble NClT, Mumbai Bench, passed the order for initiation of

CIRP under section 7 of the insolvency and Bankruptcy Code, 2016 (As amended and hereinafter referred to as "the

Code”) dated July 16, 2020 appointing Mr. Vinit Gangwal as Interim Resolution Professional. The COC in its 3rd

meeting held on October 19,2020 appointed Mr. Dinesh Kumar Agarwal as the Resolution Professional (RP)and the same was approved by NCLT bench vide order dated December 04, 2020. Further, the RP had invited expression of interest (Eol) from Prospective Resolution Applicants (PRAs) to submit the Resolution Plan for the Company. Final plans received were placed, put to vote in the 16th CoC meeting held on February 07, 2022. The resolution plan submitted by M/s Deep Industries limited (Resolution Applicant- RA) was approved by CoC. The application for Plan approval was filed with Hon’ble National Company Law Tribunal (NCLT) on February 16, 2022 and subsequently has been approved/allowed by the Hon’ble NCLT vide Order dated September 29, 2022.

2. With the approval of the Resolution Plan by the Hon’ble National Company Law Tribunal (NCLT) vide Order dated September 29, 2022, the CIRP of the Company has concluded and Mr. Dinesh Kumar Agarwal ceased to be the RP of the Company. The said resolution plan has been implemented by the Monitoring Committee and the management of the Company has been handed over to the RA by the Monitoring Committee w.e.f. April 01, 2022. In view of the approved resolution plan, following effects have been given in the accounts of the Company for the year and quarter ended March 31, 2023.

3 (a) In compliance with Rule 19A(5) of the Securities Contracts (Regulation) Rules, 1957 with respect to 5% public

shareholding, shares held by public shareholders shall stand partially extinguished while that of promoters shall stand extinguished. Fresh equity is issued by RA through its subsidiary to the tune of INR 3 Crores carrying 95% shareholding having face value of INR 10 each.

(b) The existing directors of the Company as on the date of Order stand ceased pursuant to the order. The new Board of Directors were appointed by the Monitoring Agency with effect from December 15, 2022.

(c) In view of extinguishment post payment as per the Resolution Plan, balances comprising of current liabilities, current assets, statutory outstanding and equity investments except Provident Fund & ESIC, the same is recognized in the statement of profit and loss statement in accordance with "Ind AS - 109” on "Financial Instruments” prescribed under section 133 of the Companies Act, 2013 and disclosed and included under "Exceptional items”.

(d) In view of extinguishment post payment as per the Resolution Plan, balances comprising of financial creditors & extinguished equity, is recognized directly in "Other Equity” in accordance with "Ind AS - 109” on "Financial Instruments” prescribed under section 133 of the Companies Act, 2013.

(e) Funds amounting to INR 1,802.53 Lakhs were brought by way of Unsecured Loans and INR 300 Lakhs by way of Equity Shares by the RA through its subsidiary as per the terms of the approved resolution plan.

(f) As per approved resolution plan, the contingent liabilities and commitments, claims and obligations, corporate guarantees and Legal Proceedings initiated against the Company stand extinguished and accordingly no outflow of economic benefits is expected in respect thereof. The Resolution plan further provides that implementation of resolution plan will not affect the rights of the Company to recover any amount due to the Company and there shall be no set off of any such amount recoverable by the Company against any liability discharged or extinguished.

(g) As per NCLT order, the existing issued, subscribed, paid up 1,67,72,518 equity share capital of Rs. 10 each stand fully cancelled and extinguished. The reduction in the share capital of the Company amounting to Rs. 1,677.25 Lakh is adjusted against the debit balance as appearing in its profit and loss account (i.e., retained earnings).


Mar 31, 2018

COMPANY OVERVIEW

Dolphin Offshore Enterprises (India) Limited (the “Company”) was incorporated as a Private Limited Company under the Indian Companies Act, 1956 on May 17, 1979 with the objective of providing services to the offshore Oil and Gas Industry. The Company initially commenced operations by providing diving services to the Oil and Gas Natural Commission (now reconstituted as the Oil and Natural Gas Corporation Limited). Over the years, the Company has expanded its capabilities and now provides a range of services as explained below.

In 1994, the Company converted into a public limited company and had its Initial Public Offering. The Company is currently listed on the Bombay Stock Exchange and the National Stock Exchange.

The Company has three subsidiaries, Dolphin Offshore Shipping Limited (“DOSL’), Dolphin Offshore Enterprises (Mauritius) Private Limited (“DOEMPL’) and Global Dolphin Drilling Company Limited (“GDDC”). In addition, The Company has entered in a joint venture with IMPaC Offshore Engineering GmbH for providing design and engineering services.

DOSL is involved in the business of owning, operating and managing vessels and in handling marine logistics. DOEMPL, apart from owning vessels, also provides the whole range of services that the Company provides to the international market. GDDC provides offshore drilling units to be used for oil and gas exploration and production.

The current range of services that Dolphin Offshore and subsidiaries provide are :

a. Underwater diving and engineering

b. Design and engineering

c. Vessel operations and management

d. Marine logistics

e. Ship repair and rig repair services

f. Fabrication

g. Electrical and Instrumentation services

h. Offshore hook-up and commissioning

i. Undertaking turnkey EPC contracts

Note :

(i) Deemed cost of plant, property and equipment, except buildings, as on April 1, 2016 is the net written down value as per previous GAAP The Company has elected to fair value its buildings and use that fair value in its Opening Ind AS balance sheet (as at April 1, 2016) as deemed cost, in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards. Hence accumulated depreciation on April 1, 2016 is shown as Nil. Buildings have been considered at its fair market value on April 1, 2016 which has resulted in an increase in value of Rs. 18,92.86 lakhs and correspondingly Retained Earnings as at April 1, 2016 have also been increased.

(ii) For details of assets given as security against borrowings [Refer note 19 (a)].

Note:

(i) Deferred tax assets of Rs. 35,83.76 lakhs ((March 31, 2017 : Rs. 39,04.49 lakhs, April 01, 2016 : Rs. 31,80.09 lakhs) comprising of unabsorbed losses and unabsorbed depreciation (except for deferred tax liability on depreciation of Rs.Nil (March 31, 2017 : Rs. 2.11 lakhs, April 01, 2016 : Rs.Nil) have not been recognised as a measure of prudence and for lack of virtual certainty.

(ii) Significant management judgement is required in determining provision for income tax, deferred income tax assets and liabilities and recoverability of deferred income tax assets. The recoverability of deferred income tax assets is based on estimates of taxable income by each jurisdiction in which the relevant entity operates and the period over which deferred income tax assets will be recovered.

Note:

The fixed deposit receipts of Rs. 12,26.68 lakhs (March 31, 2017 : Rs. 5,33.32 lakhs, April 01, 2016 : Rs. 4,11.86 lakhs) have been deposited with the State Bank of India in lieu of margin money on guarantees and letters of credit issued by the Banks. Further, Rs. 1,61.00 lakhs (March 31, 2017 : Rs. 1,61.00 lakhs, April 01, 2016 : Rs. 1,61.00 lakhs) have been pledged as a security against various credit facilities availed from the bank.

(d) The Company has only one class of shares referred to as equity shares having a par value of Rs. 10 per share. Each holders of equity shares carry one vote per share without restrictions and are entitled to dividend, as and when declared.

(e) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive the remaining assets of the company, after distribution of all preferential amounts. All shares rank equally with regard to the Company’s residual assets and the distribution will be in proportion to the number of equity shares held by the shareholers.

(f) There are no shares reserved for issue under options and contracts/commitments for the sale of shares/disinvestment.

(g) For detailed Capital Management [Refer note 45].

Note:

(a) Securities premium reserve represents the difference between the face value of the equity shares and the consideration received in respect of shares issued, which can be utilised only in accordance with the provisions of the Act, for specified purposes.

(b) General reserve is created in earlier years pursuant to the provisions of the Act, wherein certain percentage of profits were required to be transferred to General Reserve before declaring dividends. Now, the requirement to transfer profits to General Reserve is not mandatory. General Reserve is a free reserve available to the Company.

(c) Retained earnings represents surplus/accumulated earnings of the Company and are available for distribution to shareholders.

Note:

(a) Secured by the hypothecation of current assets, first mortgage charge on immovable properties, pledge of TDR, hypothecation of various vessels and tugs owned by DOSL, pledge of 30% of shares of DOSL, pledge of TDR of DOSL, pledge of Company’s shares held by Promoter group. Personal guarantees of whole time directors and Rear Admiral Kirpal Singh and Corporate guarantee by DOSL and DOPL).

1: CONTINGENT LIABILITIES

(i) (a) As at March 31, 2018 the Company had contingent liabilities in respect of bank guarantees issued to customers of Rs. 55,01.45 lakhs (March 31, 2017 : Rs. 41,21.26 lakhs, April 01, 2016 : Rs. 39,50.80 lakhs) and letter of credit issued to vendors of Rs.Nil lakhs (March 31, 2017 : Rs. 9,46.30 lakhs, April 01, 2016 : Rs. 1,58.68 lakhs). Further with respect to letter of credit issued to vendors Rs.Nil (March 31, 2017 : Rs. 6,40.12 lakhs, April 01, 2016 : Rs. 1,34.47 lakhs) are outstanding as of date and are grouped under Trade Payables as on March 31, 2018. (Secured by the hypothecation of current assets, first mortgage charge on immovable properties, pledge of TDR, hypothecation of various vessels and tugs owned by DOSL, pledge of 30% of shares of DOSL, pledge of TDR of DOSL, pledge of Company’s shares held by Promoter group. Personal guarantee of whole time directors and Rear Admiral Kirpal Singh and Corporate guarantee by DOSL and DOPL).

(b) The Company has given Corporate guarantee to State Bank of India of Rs. 5,00.00 lakhs (March 31, 2017 : Rs. 5,00.00 lakhs, April 01, 2016 : Rs. 5,00.00 lakhs) for financial facilaites availed by Dolphin Offshore Shipping Limited

(ii) Claim against the Company on account of Interest on delayed rent not acknowledged as debt (on account of counter claim by the Company) Rs. 33.66 lakhs (March 31, 2017 : Rs. 33.66 lakhs, April 01, 2016 : Rs. 55.35 lakhs) and interest on outstanding payment to Divers not acknowledge as debt of Rs. 15.89 lakhs.

(iii) Income tax demand of Rs. 27,86.83 lakhs (March 31, 2017 : Rs. 21,89.55 lakhs, April 01, 2016 : Rs. 14,93.56 lakhs), for various assessment year issued by the Income Tax Authorities has been disputed, against which refund has been adjusted or the Company has deposited Rs. 14,07.53 lakhs (March 31, 2017 : Rs. 8,87.13 lakhs, April 01, 2016 : Rs. 5,15.18 lakhs) under protest.

(iv) Sales tax demand of Rs. 25,45.83 lakhs (March 31, 2017 : Rs. 22,83.10 lakhs, April 01, 2016 : Rs. 75,78.06 lakhs) raised against the Company has been disputed, against which the Company has deposited Rs. 10,51.34 lakhs (March 31, 2017 : Rs. 8,04.62 lakhs, April 01, 2016 : Rs. 7,93.82 lakhs) under protest.

(v) Service tax authorities have issued show cause notice against the Company on several issues amounting to Rs. 185,85.92 lakhs (March 31, 2017 : Rs. 157,85.44 lakhs, April 01, 2016 : Rs.Nil). The Company has disputed the same and have filed an appeal with the Commissioner, Service Tax, Audit-I, Belapur for adjudicating the matter. The procedings have commenced and we are confident that the matter will be decided in our favour.

(vi) Claims against the Company not acknowledged as debts Rs. 15,83.03 lakhs (March 31, 2017 : Rs. 15,83.03 lakhs, April 01, 2016 : Rs.Nil) (Refer Note 41(e)) Management is of the view that above matters are not likely to have any impact on the financial position of the Company.

Notes:

1. The Company does not expect any reimbursements in respect of the above contigent liabilities.

2. In respect of matters at (i) the cash outflows, if any, could generally occur upto three years, being the period over which the validity of the guarantees extends.

3. It is not practicable to estimate the timing of cash outflows, if any, in respect of matters at (ii) to (vi) above pending resolution of the appellate proceedings. Further, the liability mentioned in (ii) to (v) above excludes interest and penalty in cases where the company has determined that the possibility of such levy is remote.

2: DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 17, LEASES

The Company had taken on office premises and workshop on lease for the period ranging from 1 to 10 years.

(a) The minimum amounts payable in future towards non-cancellable lease agreements for premises are as follows :

(b) Lease payments recognised in the Statement of profit and loss for the year is Rs. 1,49.18 lakhs (March 31, 2017 : Rs. 2,46.02 lakhs, April 01, 2016 : Rs. 1,37.33 lakhs).

3: DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 19, EMPLOYEE BENEFITS

a) The Company has recognised the following amounts in the statement of profit and loss :

* Included in ‘Employer’s Contribution to Provident Fund’.

The Company has an obligation towards gratuity, a defined benefit obligation. The benefits are governed by the Payment of Gratuity Act, 1972. The Company makes lumpsum payment to vested employees an amount based on 15 days last drawn basic salary including dearness allowance (if any) for each completed year of service or part thereof in excess of six months. Vesting occures upon completion of five years of service.

The most recent actuarial valuation of the defined benefit obligation was carried out at the balance sheet date. The present value of the defined benefit obligations and the related current service cost and past service cost were measured using the Projected Unit Credit Method.

b) Based on the actuarial valuation obtained in this respect, the following table sets out the details of the employee benefit obligation as at balance sheet date:

2 Sensitivity analysis method

Sensitivity analysisis performed by varying a single parameter while keeping all the other parameters unchanged. Sensitivity analysis fails to focus on the interrelationship between underlying parameters. Hence, the results may vary if two or more variables are changed simultaneously. The method used does not indicate anything about the likelihood of change in any parameter and the extent of the change, if any.

Notes:

a) Amount recognised as an expense in the statement of profit and loss and included in Note 28 under “Salaries and wages” & “Contribution to provident and other funds”:

Leave encashment ‘ (23.04) lakhs (Previous year - ‘ (12.03) lakhs) and Gratuity Rs. 71.89 lakhs (Previous year - Rs. 8.96 lakhs).

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

(b) Defined contribution plan

The Company has classified the various benefits provided to employees as under :

(a) Provident fund

(b) Superannuation fund

(c) Employers’ Contribution to Employees’ Pension Scheme 1995

(d) Employees State Insurance Scheme (ESIC)

The provident fund is operated by the Regional Provident Fund Commissioner, the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation of india and the Employees State Insurance Scheme is administered under State Insurance Act . Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

4: DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 24, RELATED PARTY DISCLOSURES

i) Related party relationships:

a) Companies under common control, including subsidiaries:

1) Global Dolphin Drilling Co Limited (‘GDDC’) - 59.96 % subsidiary

2) Dolphin Offshore Enterprises (Mauritius) Private Limited (‘DOEMPL’) - 100.00 % subsidiary

3) Dolphin Offshore Shipping Limited (‘DOSL’)* - 100.00 % subsidiary

4) Dolphin Offshore Projects Limited (‘DOPL’)** - Under common control

5) IMPaC Oil & Gas Engineering (India) Private Limited (‘Impac’) - 40 % Joint Venture

b) Key Management Personnel

i) Rear Admiral Kirpal Singh - Non-Executive Chairman

ii) Mr. Sabyasachi Hajara - Chairman independent Director

iii) Mr. Satpal Singh - Managing Director & CEO

iv) Mr. Navpreet Singh - Joint Managing Director & CFO

v) Dr. Faqir Chand Kohli - Independent Director

vi) Mrs. Manjit Kirpal Singh - Non-Executive Director

vii) Mr. V Surendran - Company Secretary

c) Relatives of Key Management Personnel with whom the Company has had transactions during the year.

i) Mr. Rohan Singh - Son of Managing Director & CEO

ii) Mrs. Ritu Singh - Spouse of Joint Managing Director & CFO

iii) Mr. Tarun Singh - Son of Joint Managing Director & CFO

iv) Mr. Akhil Singh - Son of Joint Managing Director & CFO

5 : DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 108, SEGMENT REPORTING

The Company is mainly engaged in offshore business and there are no separate reportable segments. Accordingly, disclosure under this Standard is not applicable.

Note: Note: The above information is given to the extent available with the Company and relied upon by the auditor.

6 : DEBTORS AND CREDITORS

(a) Trade receivable and accrued income include Rs. 13,17.77 lakhs (March 31, 2017 : Rs. 1,317.77 lakhs, April 01, 2016 : Rs. 1,317.77 lakhs) due from an entity which is declared Sick and in respect of which a Scheme of Rehabiliation is under implementation. The Management, however, is of the opinion that provision amounting to Rs. 4,26.12 lakhs (March 31, 2017 : Rs. 4,26.12 lakhs, April 01, 2016 : Rs. 4,26.12 lakhs) made against such receivable is adequate.

(b) Advances recoverable includes Rs. 2,13.18 lakhs (March 31, 2017 : Rs. 2,13.18 lakhs, April 01, 2016 : Rs. 2,13.18 lakhs) from a vendor which has not been refunded/adjusted for a considerable period of time. The Management, however, is of the opinion that such advances are refundable/adjustable.

(c) An amount of Rs. 2,93.26 lakhs (March 31, 2017 : Rs.Nil, April 01, 2016 : Rs.Nil) recoverable from a vendor on account cost of materials and services incurred for which the claim is yet to be made. The Management, however, is of the opinion that such amount will be adjusted.

(d) Considering the nature of projects being executed by the Company for its main customers, the consequential claims and counter claims towards liquidated damages, change order, etc., and as per general practice prevalent in the industry, the balances outstanding as trade receivables (which also include interest charged as per contract terms), billable costs, advances to/balances payables towards contractors and vendors of the Company are not confirmed by customers/vendors and against some of the customers the Company has also initiated legal actions. The Management, however, is of the opinion that such receivables/payables are stated at their realisable/payable value and adequate provisions have been made in the books of account, wherever necessary.

(e) During the year 2013-14 and 2014-15, the Company has incurred additional expenditure on executing additional work in terms of an EPC contract. The Company has quantified the value of extra work done at Rs. 103,59.19 lakhs (March 31, 2017 : Rs. 100,35.13 lakhs, April 01, 2016 : Rs. 102,00.76 lakhs) and has commenced discussions with the customer for acceptance of its claim. Out of the claim, invoices for Rs. 24,82.49 lakhs (March 31, 2017 : Rs. 21,58.43.00 lakhs, April 01, 2016 : Rs. 23,24.07 lakhs) have been raised on the customer and the balance amount of Rs. 78,76.70 lakhs (March 31, 2017 : Rs. 78,76.70 lakhs, April 01, 2016 : Rs. 78,76.70 lakhs) accrued on this account is included under other current assets pending finalisation of the claim by the customer.

(f) Trade receivable includes Rs. 25,20.49 lakhs; (31st March, 2017 - Rs. 25,12.94 lakhs, April 01, 2016 : Rs.Nil) due from a charter hire contract. The said hirer has disputed the claim and has raised counter claim for damages of Rs. 15,83.03 lakhs against the Company. The Management, however, is of the opinion that no provision is required against such counter claim made by the customer, since it is not tenable..

7: DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 112, DISCLOSURE OF INTERESTS IN OTHER ENTITIES

The Company has a joint venture interest in IMPaC Oil & Gas Engineering (India) Private Limited (a company incorporated in India) and its proportionate share in the assets, liabilities, income and expenses of the jointly controlled entity, based on the audited accounts drawn up to March 31, 2018 is as under :

Percentage of ownership interest as at March 31, 2018 - 40%.

8: DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 107, FINANCIAL INSTRUMENTS -DISCLOSURES

A. Accounting classification and fair values

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.

B. Measurement of fair value

The fair values of the financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values:

1. Fair value of cash and short-term deposits, trade and other short term receivables, trade payables, other current liabilities, short term loans from banks and other financial institutions approximate their carrying amounts largely due to short term maturities of these instruments.

2. Financial instruments with fixed and variable interest rates are evaluated by the Company based on parameters such as interest rates and individual credit worthiness of the counterparty. Based on this evaluation, allowances are taken to account for expected losses of these receivables.

C. Fair Value Hierarchy

The fair value of financial instruments as referred to above have been classified into three categories depending on the inputs used in the valuation technique. The hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements).

Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices. This includes listed equity instruments, traded bonds and mutual funds that have quoted price. The fair value of all equity instruments which are traded in the stock exchanges is valued using the closing price as at the reporting period.

Level 2: The fair value of financial instruments that are not traded in an active market is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities included in level 3.

D. Market Risk Management

The Company’s activities expose it to credit risk, liquidity risk and market risk. The Company’s primary focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

(i) Risk management framework

The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Company’s risk management framework. The Board of Directors is responsible for developing and monitoring the Company’s risk management policies.

The Company’s risk management policies are established to indentify and analyse the risks faced by the Company, to set appropriate risk limits and controls to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and Company’s activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control enviornment in which all employees understand thier roles and obligations.

The Company’s Audit Committee also oversees how management monitors compliance with the Company’s risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and adhoc reviews of risk management controls and procedures, the results of which are reported to the audit committee.

(ii) Credit risk Trade and other receivables

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s receivables from customers investment in subsidaries and joint ventures and cash and cash equivalents. The Company makes provision on trade receivables based on Expected Credit loss (ECL) method basis on provision matrix.

Trade receivables are typically unsecured and are derived from revenue earned from customers located in India and overseas. Credit risk has always been managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The Company has a detailed review mechanism of overdue trade receivables at various levels in the organisation to ensure proper attention and focus on realisation.

Expected Credit Loss assessment

Exposure to customers outstanding at theend of each reporting period are reviewed nu the Company to determine incurred and expected credit losses. Management believes that the unimpaired amounts that are past due are still collectible in full, based on historical payment behaviour and extensive analysis of customer credit risk.

The movement in the loss allowance in respect of trade and other receivables during the years is as follows:

Cash and bank balances and bank deposits

The Company held cash and cash equivalents and bank deposits with banks and financial institutions. The credit worthiness of such banks and financial instituions is evaluated by the management on an on-going basis and is considered to be good.

Other than trade receivables, the Company has no other financial assets that are past due but not impaired.

(iii) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet financial obligations as they become due to reasonable price. The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when they are due under both normal and stressed conditions, without incurring unacceptable lossess or risk to the Company’s reputation.

The Company also monitors the level of expected cash inflows on trade receivables together with expected cash outflows on trade payables and other financial liabilities. The Company has access to a sufficient sources of short term funding with existing lenders that could be arranged upon should need arises..

Exposure to liability risk

The following are the remaining contractual maturities of financial liabilities at the reporting date. The contractual cash flows are gross and undiscounted, and include estimated interest payments.

(iv) Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from adverse changes in market rates and prices (such as interest rates and foreign currency exchange rates) or in the price of market risk-sensitive instruments as a result of such adverse changes in market rates and prices. Market risk is attributable to all market risk-sensitive financial instruments, short-term and long-term debt, including foreign currency receivables and payables. The Company’s exposure to market risk is primarily related to foreign exchange rate risk and interest rate risk. Thus, Company’s exposure to market risk is a function of investing and revenue generating activities in foreign currency. The objective of market risk management is to avoid excessive exposure in our foreign currency revenue and costs.

(v) Currency risk

The Company is exposed to risk of changes in foreign currency values on account of its receivables and payables. The functional currency of the Company is Indian Rupee. The Company’s business model incorporates assumptions on currency risks and ensures any exposure is covered through the normal business operations.

The Company has not entered into any derivative transactions during the year and there were no derivative transactions outstanding as on March 31, 2017 and April 1, 2016.

Sensitivity analysis

A reasonably possible strengthening (weakening) of the Indian Rupee against various currency mentioned in the table below as at reporting date would have affected the measurement of financial instruments denominated in foreign currency and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

(vi) Interest rate risk

Interest rate risk can be either fair value interest rate risk or cash flow interest rate risk. Fair value interest risk is the risk of changes in fair values of fixed interest bearing investments because of fluctuations in the interest rates. Cash flow interest risk is the risk that the future cash flows of floating interest bearing investments will fluctuate because of fluctuations in the interest rates.

Exposure to interest rate

Company’s interest rate risk arises from borrowings. The interest rate profile of the Company’s interest-bearing financial instruments as reported to the management of the Company is as follows:

Fair value sensitivity analysis for fixed-rate instruments

The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 50 basis points in interest rates at the reporting date would have increased (decreased) profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

The risk estimates provided assume a change of 50 basis points interest rate for the interest rate bench mark as applicable to the borrowings summarised above. This calculation also assumes that the change occurs at the balance sheet date and has been calculated based on risk exposures outstanding as at that date. The period end balances are not necessarily representative of the average debt outstanding during the period.

9: CAPITAL MANAGEMENT

Equity share capital and other equity are considered for the Company’s capital mangement. The Company manges its capital so as to safeguard its ability to continue as going concern and to optimise returns to shareholders. The capital structure of the Company is based on mangement’s judgement of its strategic and day-to-day needs with a focus on total equity so as to maintian investor, creditors and market confidence. The management and the Board of Directors monitors the return on capital as well as the level of dividends to shareholders. The Company may take appropriate steps in order to maintain, or if necessary, adjust its capital structure.

The Company monitors capital using a ratio of ‘adjusted net debt’ to ‘equity’. For this purpose, adjusted net debt is defined as total liabilities, comprising interest-bearing loans and borrowings less cash and cash equivalents. Total equity comprises all components of equity.

The Company’s adjusted net debt to equity ratio at the reporting period is as follows:

No changes were made in the objectives, policies or processes for managing capital of the Company during the current and previous year.

10 : DISCLOSURE PURSUANT TO SECTION 186 OF THE COMPANIES ACT, 2013

11: CORPORATE SOCIAL RESPONSIBILITY (CSR)

Amount required to be spent by the Company on Corporate Social Responsibility (CSR) related activities during the year is Rs.Nil: (March 31, 2017 : Rs.Nil).

(a) The amount recognised as expense in the Statement of profit and loss on CSR realted activities is Rs.Nil : (2016-17 : Rs.Nil).

12: INVESTOR EDUCATION AND PROTECTION FUND

There are no amounts due and outstanding to be credited to Investor Education and Protection Fund as at March 31, 2018.

13 : DISCLOSURE PURSUANT TO INDIAN ACCOUNTING STANDARD (IND AS) 101, FIRST-TIME ADOPTION OF INDIAN ACCOUTING STANDARDS

I. Transition to Ind AS:

The Compnay has transitione dthe basis of accounting from Indian generally accepted accounting principles (“previous GAAP”) to Ind AS. The accounting policies set out in Note 1have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of an opening Ind AS balance sheet as at April 1, 2016 (the Transition Date). In preparing opening Ind AS balance sheet, the company have adjsuted amounts reported in teh financial statements prepared in accordance with previous GAAP An explanation of how the transition from previous GAAP to Ind AS has affected the financial performance, cash flows and financial position is set out in the following tables and the notes that accompany the tables. On transition, the company did not revise estimates previously made under previous GAAP execept where required by Ind AS.

II. Optional exemptions from retrospective application:

Ind AS 101 allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has applied the following exemptions:

1 Property, plant and equipment (PPE) and intangible assets:

Ind AS 101 permits a first time adopters to fair value or to continue with the carrying value of all its property, plant and equipment and tangible assets that are recognised in the financial statements as at the date of transition to Ind AS, measured as per previous GAAP and use that as its deemed cost as at the date of transition.

Accordingly, the Company has elected to fair value only its building and use that fair value in its Opening Ind AS balance sheet (as at April 01, 2016) and measure all other plant and equipment and tangible assets at thier previous GAAP values.

2 Investment in subsidiaries :

The Company has elected to measure investments in subsidiaries as per the statement of financial position prepared in accordance with previous GAAP as a deemed cost at the date of transition as per exemption available under Ind AS 101.

Interest in the subsidiaries through fair valuation of financial guarantees at initial recognition on transition date had been accounted as investments in accordance with Ind AS 109. The Company has accounted such fair valuation of financial guarantees on transition date to the retained earnings.

3 Long-term foreign currency monetary items :

A first-time adopter may continue the policy adopted for accounting for exchange differences arising from translation of long-term foreign currency monetary items recognised in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period as per the previous GAAP The Company has chosen to continue this option provided under para D13AA of Ind AS 101.

III. Mandatory exemptions from retrospective application

1 Estimates :

The estimates as at April 1, 2016 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from impairment of financial assets based on expected credit loss model where application of Indian GAAP did not require estimation. The estimates used by the Company to present these amounts in accordance with Ind AS reflect conditions at April 1, 2016 (transition date) and March 31, 2017.

2 Derecognition of financial assets and liabilities :

Financial assets and liabilities de-recognised before transition date are not re-recognised under Ind AS.

3 Classification of financial assets:

As per the requirements of Ind AS 101 the Company has assessed classification of financial assets on the basis of the facts and circumstances that existed at the date of transition to Ind AS.

IV. The transition from Indian GAAP to Ind AS did not had material impact on the statement of cash flows.

V. Transition to Ind AS - Reconcilations

The following reconcialtions provide the explanations and quantifcation of the differences arising from the transition from previous GAAP to Ind AS in accordance with Ind AS 101:

F Notes to reconciliation

a Fair value of certain items of Property, plant and equipment

Company has elected to measure certain items of property, plant and equipment at fair value at the date of transition to Ind AS. Hence at the transition date, an increase of Rs. 18,92.86 lakhs was recognised in property, plant and equipment. This amount has been recognised against retained earnings. Accordingly, the Company has also charged the additional depreciation of Rs. 1,16.83 lakhs to the amount recorded under Indian GAAP for the year ended March 31, 2017.

b Financial guarantee given to subsidiary

Under previous GAAP financial guarantee given was disclosed as contingent liability and commitments. Under Ind AS, the Company has recognised fair value of financial guarantee provided to its subsidiary company. The fair value of such guarantee as at April 01, 2016 has been recognised as additional capital investment in its subsidiary company and is amortised over tenure of the guarantee. Subsequently, in the year ended March 31, 2017, increase in the fair value of financial guarantee on account of refinancing of borrowings was recognised as additional investment in its subsidiary. The impact of amortisation of such fair value of guarantee has been recognised in the statement of profit and loss as interest income for the year ended March 31, 2017.

c Trade receivable

Under previous GAAP the Company has created provision for impairment of receivables which consists only in respect of specific amount for probable losses. Under Ind AS, impairment allowance has been determined based on Expected Credit Loss (ECL) model. Due to ECL model, the Company impaired its trade receivable by Rs. 8,25.19 lakhs (net of related deferred tax) on April 1, 2016 which has been eliminated against other equity.

d Deferred tax assets

Under previous GAAP deferred tax were recognised for the tax effect of timing difference between accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Under Ind AS 12, deferred taxes are recognised using the balance sheet approach, which focuses on temporary difference between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on new temporary differences which was not required under previous GAAP In addition, the various transitional adjustments lead to temporary differences and the Company has accounted for such differences. Deferred tax adjustment are recognized in correlation to the underlying transaction either in retained earnings or through other comprehensive income.

e Remeasure of actuarial gains/ (losses)

Under previous GAAP the Company recognised actuarial gains /losses on post-employment defined benefit plan i.e., gratuity under Statement of profit and loss. Under Ind AS, actuarial gains /losses on post-employment defined benefit plans are recognised in Other comprehensive income.

f Other comprehensive income

Under Ind AS, all items of income and expense recognised in a period should be included in the Statement of Profit and Loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognised in profit or loss but are shown in the Statement of Profit and Loss as ‘other comprehensive income’ includes remeasurements of defined benefit plans. The concept of other comprehensive income did not exist under previous GAAP


Mar 31, 2016

1. Disclosure Under AS - 15 (Revised 2005)

Company has adopted the Accounting Standard (AS - 15) (Revised 2005) “Employee Benefits” effective April 01, 2007.

I. Defined Contribution Plans

The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Superannuation Fund

c. Employers'' Contribution to Employees'' Pension Scheme 1995

The provident fund is operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

The Company has recognized the following amounts in the statement of Profit and Loss.

II. Defined Benefit Plans

(a) Contribution to Gratuity Fund (Funded Scheme)

In accordance with the Accounting Standard (AS - 15) (Revised 2005), actuarial valuation was performed by independent actuaries in respect of the aforesaid defined benefit plan based on the following assumptions on projected unit credit method.

2 Contingent Liabilities:

i) As at March 31, 2016 the Company had contingent liabilities in respect of bank guarantees issued to customers and letter of credit, issued to vendors of Rs. 41,09.44 lacs (RY-?48,72.31 lacs). Further, Rs.40,22.43 lacs (F!Y—Rs. 54,52.75 lacs) are outstanding as of date. (Secured by the hypothecation of current assets, first mortgage charge on immovable properties, pledge of TDR, hypothecation of various vessels and tugs owned by DOSL, pledge of 30% of shares of DOSL, pledge of TDR of DOSL, pledge of Company''s shares held by Promoter group. Personal guarantee of whole time directors and Rear Admiral Kirpal Singh and Corporate guarantee by DOSL and DOPL).

The Company has given a Corporate guarantee to State Bank of India of Rs. 5,00.00 lacs (PY-Rs. 8,50.00 lacs) for financial facilities availed by Dolphin Offshore Shipping Limited.

ii) Claims against the Company on account of liquidated damages resulting from the extended completion date not acknowledged as debts Rs.12,29.46 lacs (PY-Rs.11,08.55 lacs)

iii) The Asst. Commissioner of Income Tax has passed the draft Assessment order for the A. Y 2012-13 with the addition of income of Rs.8.16 crores & Rs.1.10 crores on account of adjustments made by TPO for Interest & Corporate Guarantee respectively. We have filed a petition with DRR for the objections to the draft Assessment order.

iv) Income tax demand of Rs.14,93.56 lacs (PY -Rs.6,64.98 lacs), for various assessment year issued by the Income Tax Authorities has been disputed, against which the Company has deposited Rs. 5,15.18 lacs (PY-Rs.4,95.18 lacs ) under protest.

v) Sales tax demand of Rs.75,78.06 lacs (PY-Rs.18,70.99 lacs) raised against the Company has been disputed, against which the Company has deposited Rs.7,93.82 lacs (PY-Rs.4,95.18 lacs ) under protest.

Management is of the view that above matters are not likely to have any impact on the financial position of the Company..

3. Segment reporting

The Company is mainly engaged in offshore business and there are no separate reportable segments as per Accounting Standard (AS) 17.

4. Related Party Disclosures

Related party transactions cover transactions between the Company and the following persons in accordance with the Accounting Standard 18.

1) Related party relationships:

(As identified by the management)

a) Companies under common control, including subsidiaries:

i) Dolphin Offshore Projects Limited - under common control

ii) Global Dolphin Drilling Co Limited - 59.96 % subsidiary

iii) Dolphin Offshore Enterprises (Mauritius) Private Limited - 100.00 % subsidiary

iv) Dolphin Offshore Shipping Limited - 100.00 % subsidiary

v) IMPaC Oil & Gas Engineering (India) Private Limited - 40 % Joint Venture

b) Key Management Personnel

Rear Admiral Kirpal Singh Non-Executive Chairman (w.e.f 14/07/2015)

Mr. Satpal Singh Managing Director & CEO

Mr. Navpreet Singh Joint Managing Director & CFO

c) Relatives of Key Management Personnel with whom the Company has had transactions during the year.

Mrs. Manjit Kirpal Singh Spouse of Non-Executive Chairman

Mrs. Prabha Chandran Daughter of Non-Executive Chairman

Mrs. Nitu Singh Spouse of Managing Director & CEO

Ms. Rishma Singh Daughter of Managing Director & CEO

Mr. Rohan Singh Son of Managing Director & CEO

Mrs. Ritu Singh Spouse of Joint Managing Director & CFO

Mr. Tarun Singh Son of Joint Managing Director & CFO

Mr. Akhil Singh Son of Joint Managing Director & CFO

5. Operating Lease commitments

Disclosure in respect of Operating Lease

The Company has taken on lease office premises, workshop and EOT crane for the period ranging from 1 to 10 years.

a) The minimum amounts payable in future towards non-cancellable lease agreements for premises are as follows:

6. Particulars of Derivative Instruments as at March 31, 2016

a) The Company has not acquired any derivative instruments in the current financial year.

b) Foreign Currency Exposures that are not hedged by derivative instruments or otherwise are;

34 Interest in Joint Venture:

The Company has a joint venture interest in IMPaC Oil & Gas Engineering (India) Pvt Limited (a Company incorporated in India) and its proportionate share in the assets, liabilities, income and expenses of the jointly controlled entity, based on the audited accounts drawn up to 31st March 2016 is as under :

Percentage of ownership interest as at 31st March 2016 - 40%

7. Debtors and Creditors :

a) Considering the nature of projects being executed by the Company and its main customers, the consequential claims and counter claims towards liquidated damages, change order, etc. as per general practice prevalent in the industry, the balances outstanding as trade receivables (which also include interest charged as per contract terms), billable costs, advances to/balances payables towards contractors and vendors of the company are not confirmed and against some of them the Company has also initiated legal actions. However, the management is confident that such receivables/ payables are stated at their realizable/ payable value and adequate provisions are made in the accounts wherever required.

b) During the year 2009-2010, the Company has taken extra time to complete an EPC contract beyond the scheduled contract completion date as the Company had to execute significant additional work and also on account of delays not attributable to the Company. The potential liability for liquidated damages resulting from the extended completion date amounts to Rs.12,29.46 lacs (PY-Rs.11,08.55 lacs). As the Company believes that the liquidated damages will be waived for the reasons stated above, no provision for the same has been made in the books till date.

c) During the year 2010-2011, the Company has incurred additional expenditure on executing additional work in terms of an EPC contract. The Company has quantified and submitted some of its claims for extra work done. However, as a matter of abundant caution, only a portion of these extra claims amounting to Rs.18,98.24 lacs (PY-Rs.18,98.24 lacs) has been recognized as revenue. The balance of the additional claims will be recognized as revenue as and when they are accepted by the customer.

d) The Company has incurred additional expenditure on executing additional work in terms of another EPC contract. Here also, the Company has quantified the value of extra work done at Rs.1,02,00.76 lacs (PY-Rs.1,02,00.76 lacs) and has commenced discussions with the customer for finalizing it. Out of this, invoices for Rs.23,24.07 lacs (PY-Rs.23,24.07 lacs) have been raised on the customer and the balance amount of Rs.78,76.69 lacs (PY-Rs.78,76.69 lacs) accrued on this account is included under other current assets. The recognition of such revenue is subject to acceptance by the customer.

e) Current Assets include Rs.29,76.60 lacs, due from parties which are either wound up or declared Sick and the claims are being lodged with Official liquidator/ Monitoring Agency. However, the management is confident that provisions amounting to Rs.12,64.85 lacs made against such receivables is adequate

8. Prior year comparatives:

The prior year figures have been reclassified/re-grouped wherever necessary for comparative purpose.


Mar 31, 2015

1 Corporate Information

Dolphin Offshore was incorporated as a Private Limited Company on May 17, 1979 with the objective of providing services to the Offshore Oil and Gas Industry. The Company initially commenced operations by providing diving services to the Oil and Gas Natural Commission (now reconstituted as the Oil and Natural Gas Company Ltd). Over the years, the Company has expanded its capabilities and now provides a range of services as explained below

In 1994, Dolphin Offshore went public and is currently listed on the Bombay Stock Exchange and the National Stock Exchange.

Dolphin Offshore has two wholly owned subsidiaries, Dolphin Offshore Shipping Ltd (hereinafter referred to as DOSL) and Dolphin Offshore Enterprises (Mauritius) Pvt Ltd (hereinafter referred to as DOEMPL). In addition, Dolphin Offshore has entered in a joint venture with IMPaC Offshore Engineering GMBH for providing design and engineering services. DOSL is only involved in the business of owning, operating and managing vessels and in handling marine logistics. DOEMPL, apart from owning vessels, will also provide to the international market the whole range of services that Dolphin Offshore provides.

The current range of services that Dolphin Offshore and subsidiaries provide are :

a. Underwater diving and engineering

b. Design and engineering

c. Vessel operations and management

d. Marine logistics

e. Ship repair and rig repair services

f. Fabrication

g. E&I services

h. Offshore hook-up and commissioning

i. Undertaking turnkey EPC contracts.

2 Change in Accounting Estimate related to depreciation and its impact on financials

To comply with the requirements of the Schedule II of the "Act" the Management has re-estimated useful lives and residual values of all its tangible fixed assets

In respect of assets where the remaining useful life is 'NIL', Rs. 34.98 lacs (net of tax benefits of Rs. 16.81 lacs) being their carrying amount after retaining the residual value as on 1st April, 2014 has been adjusted against the opening balance of retained earnings as on that date. For other assets, additional depreciation charge of Rs. 1,60.17 lacs is adjusted during the current year in the statement of Profit and loss

The impact of additional depreciation charge is likely to hold good for future years also.

3 Disclosure Under AS – 15 (Revised 2005)

Company has adopted the Accounting Standard (AS – 15) (Revised 2005) "Employee Benefits" effective April 01, 2007.

I. Defend Contribution Plans

The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Superannuation Fund

c. Employers' Contribution to Employees' State Insurance

d. Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

II. Defined Benefit Plans

(a) Contribution to Gratuity Fund (Funded Scheme)

In accordance with the Accounting Standard (AS - 15) (Revised 2005), actuarial valuation was performed by independent actuaries in respect of the aforesaid defined benefit plan based on the following assumptions:

4 Contingent Liabilities:

i) As at March 31, 2015 the Company had contingent liabilities in respect of bank guarantees issued to customers and letter of credit, issued to vendors of Rs. 48,72.31 lacs (2014 - Rs. 58,10.52 lacs). Further, Rs. 54,52.75 lacs (2014 - Rs. 57,57.24 lacs) are outstanding as of date. These bank guarantees are secured by hypothecation to and in favour of the bank of the Company's entire book debts [present and future], outstanding moneys, engagements, securities, investments and rights and further secured by personal guarantee of Whole-time Directors.

ii) Claims against the Company on account of liquidated damages resulting from the extended completion date not acknowledged as debts Rs.11,08.55 lacs (2014 -Rs. 13,47.18 lacs)

iii) The Dy. Commissioner of Income Tax has passed the draft Assessment order for the A. Y 2011-12 with the addition of income of Rs. 11.61 crores & Rs. 7.96 Crores on account of adjustments made by TPO for Interest & Corporate Guarantee . We are in process of filing an appeal with CIT (A).

iv) Income tax demand of Rs. 6,64.98 lacs (2014 - Rs. 6,64.98 lacs), for various assessment year issued by the Income Tax Authorities has been disputed, against which the Company has deposited Rs. 4,95.18 lacs (2014 - Rs. 4,95.18 lacs ) under protest.

Profession tax demand of Rs. 5.24 lacs (2014 - Rs. 5.24 lacs) raised against the Company has been disputed, against which the Company has deposited Rs. 1.35 lacs (2014 - Rs. 1.35 lacs) under protest.

Sales tax demand of Rs. 18,70.99 lacs (2014 - Rs. 18,70.99 lacs) raised against the Company has been disputed.

Management is of the view that above matters are not likely to have any impact on the financial position of the Company.

5 Segment reporting

The Company is mainly engaged in offshore business and there are no separate reportable segments as per Accounting Standard (AS) 17.

6 Related Party Disclosures

Related party transactions cover transactions between the Company and the following persons in accordance with the Accounting Standard 18 notified pursuant to Companies (Accounting standards) Rules, 2006.

1) Related party relationships:

(As identified by the management)

a) Companies under common control, including subsidiaries:

i) Dolphin Offshore Projects Limited - under common control

iii) Global Dolphin Drilling Co Limited - 59.96 % subsidiary

iv) Dolphin Offshore Enterprises (Mauritius) Private Limited - 100.00 % subsidiary

v) Dolphin Offshore Shipping Limited - 100.00 % subsidiary

vi) IMPaC Oil & Gas Engineering (India) Pvt. Limited - 40 % Joint Venture

b) Key Management Personnel

Rear Admiral Kirpal Singh Executive Chairman

Mr. Satpal Singh Managing Director & CEO

Mr. Navpreet Singh Joint Managing Director & CFO

c) Relatives of Key Management Personnel with whom the Company has had transactions during the year.

Mrs. Manjit Kirpal Singh Spouse of Executive Chairman

Mr. Rohan Singh Son of Managing Director & CEO

Mrs. Ritu Singh Spouse of Joint Managing Director & CFO

Mr. Tarun Singh Son of Joint Managing Director & CFO

Mr. Akhil Singh Son of Joint Managing Director & CFO

7 Operating Lease commitments

Disclosure in respect of Operating Lease

The Company has taken on lease various office premises and workshop for the period ranging from 1 to 10 years.

a) The minimum amounts payable in future towards non-cancellable lease agreements for premises are as follows:

b) Lease payments recognised in the statement of Profit & Loss for the period is Rs. 1,38.80 Lacs (2014 - Rs. 1,78.05 lacs)

33 Particulars of Derivative Instruments as at March 31, 2015

a) No derivative instruments are acquired for trading or speculation purposes.

b) Foreign Currency Exposures that are not hedged by derivative instruments or otherwise are

8 Interest in Joint Venture:

The Company has a joint venture interest in IMPaC Oil & Gas Engineering (India) Pvt Limited (a Company incorporated in India) and its proportionate share in the assets, liabilities, income and expenses of the jointly controlled entity, based on the audited accounts drawn up to 31st March 2015 is as under :

Percentage of ownership interest as at 31st March 2015 – 40%

9 Micro, Small and Medium Enterprises (MSMEs) ;

To the extent information is available with the Company; there are no dues payable to any parties identified as Micro and Small Enterprises as per The Micro, Small and Medium Enterprises Development Act, 2006.

10 Debtors and Creditors :

a) Considering the nature of projects being executed by the Company and its main customers, the consequential claims and counter claims towards liquidated damages, change order, etc. as per general practice prevalent in the industry, the balances outstanding as trade receivables (which also include interest charged as per contract terms), billable costs, advances to/balances payables towards contractors and vendors of the company are not confirmed and against some of them the Company has also initiated legal actions. However, the management is confident that such receivables/ payables are stated at their realisable/ payable value and adequate provisions are made in the accounts wherever required.

b) During the year 2009-2010, the Company has taken extra time to complete an EPC contract beyond the scheduled contract completion date as the Company had to execute significant additional work and also on account of delays not attributable to the Company. The potential liability for liquidated damages resulting from the extended completion date amounts to Rs. 11,08.55 lacs (2014 -Rs. 13,47.18 lacs). As the Company believes that the liquidated damages will be waived for the reasons stated above, no provision for the same has been made in the books till date.

c) During the year 2010-2011, the Company has incurred additional expenditure on executing additional work in terms of an EPC contract. The Company has quantified and submitted some of its claims for extra work done and the matter has been referred to the Outside Expert Committee (OEC) for resolution. However, as a matter of abundant caution, only a portion of these extra claims amounting to Rs. 18,98.24 lacs (2014 - Rs. 18,98.24 lacs) has been recognised as revenue. The balance of the additional claims will be recognised as revenue as and when they are accepted by the customer.

d) In respect of another EPC contract, the Company has lodged claims aggregating Rs. 48,01.19 lacs (2014 -Rs. 48,01.19 lacs) of which Rs. 32,01.60 lacs (2014 - Rs.32,01.60 lacs) has been recognized in the books of account. The OEC appointed for resolving these claims has recommended the settlement of the above for Rs. 11,17.06 lacs. The Company has rejected such recommendation of the OEC and it is in the process of referring this matter to arbitration. As a prudent measure, Rs. 20,84.54 lacs being the excess amount over and above the amount recommended by OEC has been written off during the year.

e) The Company has incurred additional expenditure on executing additional work in terms of another EPC contract. Here also, the Company has quantified the value of extra work done at Rs. 1,02,00.76 lacs (2014 - Rs. 91,64.28 lacs) and has commenced discussions with the customer for finalising it. Out of this, invoices for Rs. 23,24.07 lacs (2014 - Rs. 21,85.83 lacs) have been raised on the customer and the balance amount of Rs. 78,76.69 lacs (2014 - Rs. 69,78.45 lacs) accrued on this account is included under other current assets. The recognition of such revenue is subject to acceptance by the customer.

11 Prior year comparatives:

The prior year figures have been reclassified wherever necessary for comparative purpose.


Mar 31, 2013

1 Corporate Information

Dolphin Offshore was incorporated in May as a Private Limited Company on May 17, 1979 with the objective of providing services to the Offshore Oil and Gas Industry. The Company initially commenced operations by providing diving services to the Oil and Natural Gas Commission (now reconstituted as the Oil and Natural Gas Corporation Ltd). Over the years, the Company has expanded its capabilities and now provides a range of services as explained below.

In 1994, Dolphin Offshore went public and is currently listed on the Bombay Stock Exchange and the National Stock Exchange.

Dolphin Offshore has two wholly owned subsidiaries, Dolphin Offshore Shipping Ltd (hereinafter referred to as DOSL) and Dolphin Offshore Enterprises (Mauritius) Pvt Ltd (hereinafter referred to as DOEMPL). In addition, Dolphin Offshore has entered in a joint venture with IMPaC Offshore Engineering GMBH for providing design and engineering services. DOSL is only involved in the business of owning, operating and managing vessels and in handling marine logistics. DOEMPL, apart from owning vessels, will also provide to the international market the whole range of services that Dolphin Offshore provides.

The current range of services that Dolphin Offshore and subsidiaries provide are :

a. Underwater diving and engineering

b. Design and engineering

c. Vessel operations and management

d. Marine logistics

e. Ship repair and rig repair services

f. Fabrication

g. E&l services

h. Offshore hook-up and commissioning

i. Undertaking turnkey EPC contracts.

2 Disclosure Under AS - 15 (Revised 2005)

Company has adopted the Accounting Standard (AS - 15) (Revised 2005) "Employee Benefits” effective April 01, 2007.

I. Defined Contribution Plans

The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Superannuation Fund

c. Employers'' Contribution to Employees'' State Insurance

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

3 Contingent Liabilities:

i) As at March 31,2013, the Company had contingent liabilities in respect of bank guarantees, issued to their customers of Rs. 86,04.53 lacs (2012 - Rs. 64,32.61 lacs) of which Rs. 84,13.79 lacs (2012-Rs 64,32.61 lacs) are outstanding as of date. These bank guarantees are secured by hypothecation to and in favour ofthe bank ofthe Company''s entire book debts [present and future], outstanding moneys, engagements, securities, investments and rights and further secured by personal guarantee ofWhole-time Directors.

ii) Capital commitment and guarantees on behalf of subsidiary -

The Company has given a corporate guarantee to the lenders of Dolphin Offshore Enterprises (Mauritius) Private Limited for US$ 25.90 million (2012- US$ 25.90 million).

iii) As at March 31, 2013, the Company has commitment to pay Rs. 50,74.43 lacs (2012 - Rs. 13,07.36 lacs) towards balance amount on account of Open Purchase/Service orders.

iv) The CIT (A) had passed the order in favour of the Company with respect to the Block Period Assessment against which the Department had filled an Appeal with the ITAT, Mumbai. Due to Non - Attendance, the ITAT passed an Exparte Order against the Company on the basis of which, Company received a demand of Rs. 97.02 Lacs. The same has been paid in full & the Company is in the process of filing a restoration petition for restoring the Appeal.

Further to the demand for the Block period, the Company has received penalty order u/s. 158 BFA (2) demanding an amount of Rs. 1,97.17 Lacs. Similarly the Company has paid 50% of the penalty amounting to Rs. 98.59 Lacs in 4 Installments. The Company has already filled an Appeal with the CIA (A) against this penalty order.

During the year, Company has received a Notice of Demand of Rs. 92.53 Lacs for A.Y. 2006-07 on the basis of the order passed by CIA (A) due to disallowance of FCCB Issue Expense. 50% of the demand for A.Y2006-07 amounting to Rs. 46.27 Lacs was paid in 3 equal installments. The Company has already filed an Appeal with the ITAT Mumbai againstA.Y. 2006-07.

During the year, Company has preferred an Appeal with ITAT, Mumbai against the Order of CIA (A) for disallowing Dry Docking Charges for A.Y 2005-06 amounting to Rs. 24.94 Lacs.

The Company on April 18, 2013 has received notice of demand from Deputy Commissioner of Sales Tax for Rs. 1,13.08 lacs and interest thereon Rs. 1,28.62 lacs. The Company is in the process of preferring an appeal against the same.

4 Segment reporting

The Company is mainly engaged in offshore business and there are no separate reportable segments as per Accounting Standard (AS) 17.

5 Related Party Disclosures

Related party transactions cover transactions between the Company and the following persons in accordance with the Accounting Standard 18 notified pursuantto Companies (Accounting Standards) Rules, 2006.

1) Related party relationships

(As identified by the management)

a) Companies under common control, including subsidiaries

i) Dolphin Offshore Projects Limited - under common control

ii) Kanika Shipping Limited - under common control

iii) GlobalDolphinDrillingCoLimited - 59.96% subsidiary

iv) DolphinOffshoreEnterprises(Mauritius)PrivateLimited - 100.00%subsidiary

v) DolphinOffshoreShipping Limited - 100.00%subsidiary

vi) IMPaCOil&GasEngineering(lndia)Pvt. Limited - 40%JointVenture

b) Key Management Personnel

Rear Admiral Kirpal Singh Executive Chairman

Mr. Satpal Singh Managing Director

Mr. Navpreet Singh Joint Managing Director

Vice Admiral H.S. Malhi Whole Time Director (Executive Director Special Project)

(From 14.05.12 to 30.11.12)

c) Relatives of Key Management Personnel with whom the Company has had transactions during the year

Mrs. Manjit Kirpal Singh Spouse of Executive Chairman (Retired on 27.07.12)

Mrs. Prabha Chandran Daughter of Executive Chairman

Mrs. Nitu Singh Spouse of Managing Director

Ms. Rishma Singh Daughter of Managing Director

Mr. Rohan Singh Son of Managing Director

Mrs. Ritu Singh Spouse of Joint Managing Director

Mr. Tarun Singh Son of Joint Managing Director

Mr. Akhil Singh Son of Joint Managing Director

6 Operating Lease commitments -

a) The minimum amounts payable in future towards non-cancellable lease agreements for premises are as follows:

b) Lease payments recognised in the statement of Profit & Loss for the period is Rs. 2,44.73 Lacs (2012 - Rs. 2,04.64 lacs).

7 Particulars of Derivative Instruments as at March 31, 2013

a) No derivative instruments are acquired for trading or speculation purposes.

b) Foreign Currency Exposures that are not hedged by derivative instruments or otherwise are:

8 Interest in Joint Venture

The Company has a joint venture interest in IMPaC Oil & Gas Engineering (India) Pvt Limited (a Company incorporated in India) and its proportionate share in the assets, liabilities, income and expenses ofthe jointly controlled entity, based on the audited accounts drawn up to March 31, 2013 is as under:

9 Micro, Small and Medium Enterprises (MSMEs)

To the extent information is available with the Company, there are no dues payable to any parties identified as Micro, Small

and Medium Enterprises as perThe Micro, Small and Medium Enterprises Development Act, 2006.

10 Debtors and Creditors

a) Considering the nature of projects being executed by the Company and its main client, the consequential claims and counter claims towards liquidated damages, change order, etc., as per general practice prevalent in the industry, the balances outstanding as trade receivables and balances payables towards contractors and vendors of the company are not confirmed. However, the management is confident that such receivables/ payables are stated at their realisable/ payable value and adequate provisions are made in the accounts, wherever required.

b) Sundry debtors includes amount outstanding from a customer amounting to Rs. 25,25.82 lacs (2012 Rs. 25,25.82 lacs). This relates to a subcontract job done during 2006-07 and amount outstanding relates to change order which is still under process of resolution by the ultimate client. Management believes that this amount will be received and hence no provision has been made in the books till date.

c) During the year 2009-2010, the Company has taken extra time to complete two of its EPC contracts beyond the scheduled contract completion date as the Company had to execute significant additional work and also on account of delays not attributable to the Company. The potential liability for liquidated damages resulting from the extended completion date as on March 31, 2013 amounts to Rs. 18,40.10 lacs (2012- Rs. 30,39.76 lacs). As the Company believes that the liquidated damages will be waived for the reasons stated above, no provision for the same has been made in the books till date.

d) During the year 2010-2011, the Company has incurred additional expenditure on executing additional work under its EPC contracts. The Company has quantified and submitted some of its claims for extra work done and has commenced discussions with the clients for finalising the same. However, as a matter of abundant caution, only a portion of these extra claims amounting to Rs. 33,84.45 lacs (2012 - Rs. 33,84.45 lacs) have been recognised as revenue. The balance of the additional claims will be recognised as revenue as and when the same are accepted by the clients.

11 Prior year comparatives

Prior year figures have been reclassified wherever necessary for comparative purpose.


Mar 31, 2012

1 Corporate Information

Dolphin Offshore was incorporated as a Private Limited Company on May 17, 1979 with the objective of providing services to the Offshore Oil and Gas industry. The Company initially commenced operations by providing diving services to the Oil and Gas Natural Commission (now reconstituted as the Oil and Natural Gas Company Ltd). Over the years, the Company has expanded its capabilities and now provides a range of services as explained below.

In 1994, Dolphin Offshore went public and is currently listed on the Bombay Stock Exchange and the National Stock Exchange.

Dolphin Offshore has two wholly owned subsidiaries, Dolphin Offshore Shipping Ltd (hereinafter referred to as DOSL) and Dolphin Offshore Enterprises (Mauritius) Pvt Ltd (hereinafter referred to as DOEMPL). In addition, Dolphin Offshore has entered in a joint venture with IMPaC Offshore Engineering GMBH for providing design and engineering services. DOSL is only involved in the business of owning, operating and managing vessels and in handling marine logistics. DOEMPL, apart from owning vessels, will also provide to the international market the whole range of services that Dolphin Offshore provides.

The current range of services that Dolphin Offshore and subsidiaries provide are :

a. Underwater diving and engineering

b. Design and engineering

c. Vessel operations and management

d. Marine logistics

e. Ship repair and rig repair services

f. Fabrication

g. E&I services

h. Offshore hook-up and commissioning

i. Undertaking turnkey EPC contracts.

a) Terms/rights attached to equity shares

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

During the year 31st Mar 2012, the amount of per share dividend recognized as distribution to equity shareholder was Rs. 1.50

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

2 Disclosure Under AS - 15 (Revised 2005)

Company has adopted the Accounting Standard (AS - 15) (Revised 2005) "Employee Benefits" effective April 01, 2007. I. Defined Contribution Plans

The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Superannuation Fund

c. Employer's Contribution to Employees' State Insurance

d. Employer's Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation of India. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

3 Contingent Liabilities:

i) As at March 31, 2012 the Company had contingent liabilities in respect of bank guarantees, issued to their customers of Rs. 64,32.61 lacs (2011 - Rs. 50,53.78 lacs) of which Rs. 64,32.61 lacs (2011 - Rs. 50,53.78 lacs) are outstanding as of date. These bank guarantees are secured by hypothecation to and in favour of the bank of the Company's entire book debts [present and future], outstanding moneys, engagements, securities, investments and rights and further secured by personal guarantee of Whole-time Directors.

ii) Capital commitment and guarantees on behalf of subsidiary -

The Company has given a corporate guarantee to the lenders of Dolphin Offshore Enterprises (Mauritius) Private Limited for US$ 25.90 million (2011 - US$ 25.90 million).

iii) As at March 31, 2012, the Company has commitment to pay Rs. 13,07.36 lacs (2011 - Rs. 24,82.26 lacs) towards balance amount on account of Open Purchase/Service orders

iv) The Company has appealed the award of the CIT(Appeals) on the block assessment of the Company under Sec. 158BC of Income Tax Act 1961 raising a demand of Rs. 52.97 lacs (2011 - Rs. 52.97 lacs).

During the previous year the Company has preferred an appeal with ITAT, Mumbai against the order of CIT (A) disallowing dry-docking charges for A.Y. 2005-06 amounting to Rs. 24.94 Lacs.

The Company has filed an appeal with the CIT (A) against the order of the Assesing Officer disallowing of FCCB issue expenses for A.Y. 2006-07 amounting to Rs. 2,35.78 lacs for which a demand of Rs. 1,04.88 lacs has been raised.

4 Segment reporting

The Company is mainly engaged in offshore business and there are no separate reportable segments as per Accounting Standard (AS) 17.

Notes

a) Remuneration includes basic salary, allowance, perks and commission.

b) There are no provisions for doubtful debts or amounts written off in respect of debts due to or from related parties.

* Contract revenue includes revenues raised in foreign exchange and paid in Indian rupees which are otherwise considered as having paid for in free foreign exchange by RBI referred to in Para 9.53 (iv) of Foreign Trade Policy 2004-2009.

5 Particulars of Derivative Instruments as at March 31, 2012

a) No derivative instruments are acquired for trading or speculation purposes.

b) Foreign Currency Exposures that are not hedged by derivative instruments or otherwise are:

6 Interest in Joint Venture:

The Company has a joint venture interest in IMPaC Oil & Gas Engineering (India) Pvt Limited (a Company incorporated in India) and its proportionate share in the assets, liabilities, income and expenses of the jointly controlled entity, based on the audited accounts drawn up to 31st March 2012 is as under :

Percentage of ownership interest as at 31st March 2012 - 40%

7 Micro, Small and Medium Enterprises (MSMEs) ;

To the extent information is available with the Company; there are no dues payable to any parties identified as Micro and Small Enterprises as per The Micro, Small and Medium Enterprises Development Act, 2006.

8 Debtors and Creditors :

a) Balances in respect of creditors and debtors are subject to confirmation/reconciliation, wherever required.

b) Sundry debtors includes amount outstanding from a customer amounting to Rs. 25,25.82 lacs. This relates to a subcontract job done during 2006-07 and amount outstanding relates to change order which is still under process of resolution by the ultimate client. Management believes that this amount will be received and hence no provision has been made in the books till date.

c) The Company has taken extra time to complete two of its EPC contracts beyond the scheduled contract completion date as the Company had to execute significant additional work and also on account of delays not attributable to the Company. The potential liability for liquidated damages resulting from the extended completion date as on March 31, 2012 amounts to Rs. 30,39.76 lacs (2011- Rs. 28,30.45 lacs). As the Company believes that the liquidated damages will be waived for the reasons stated above, no provision for the same has been made in the books till date.

d) During the previous year, the Company has incurred additional expenditure on executing additional work under its EPC contracts. The Company has quantified and submitted some of its claims for extra work done and has commenced discussions with the clients for finalising the same. However, as a matter of abundant caution, only a portion of these extra claims amounting to Rs. 33,84.45 lacs (2011 - Rs. 33,59.47 lacs) have been recognised as revenue. The balance of the additional claims will be recognised as revenues as and when the same are accepted by the clients.

9 Prior year comparatives:

As notified by Ministry of Corporate Affairs, Revised Schedule VI under the Companies Act, 1956 is applicable to the Financial Statements for the financial year commencing on or after 1st April, 2011. Accordingly, the financial statements for the year ended March 31, 2012 are prepared in accordance with the Revised Schedule VI. The amounts and disclosures included in the financial statements of the previous year have been reclassified to conform to the requirements of Revised Schedule VI.


Mar 31, 2011

Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet Date.

A. Disclosure Under AS - 15 (Revised 2005)

Company has adopted the Accounting Standard (AS - 15) (Revised 2005) "Employee Benefits" effective April 01, 2007.

I. Defined Contribution Plans

The Company has classified the various benefits provided to employees as under:

a. Provident Fund

b. Superannuation Fund

c. Employers' Contribution to Employees' State Insurance

d. Employers' Contribution to Employees' Pension Scheme 1995

The provident fund and the state defined contribution plan are operated by the Regional Provident Fund Commissioner and the Superannuation Fund is administered by the Trustee of the Life Insurance Corporation of India. Under the schemes, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit schemes to fund the benefits. These funds are recognized by the Income Tax authorities.

C. Contingent Liabilities:

i) As at March 31, 2011 the Company had contingent liabilities in respect of bank guarantees, issued to their customers of Rs. 50,53.78 lacs (2010 - Rs. 59,79.13 lacs) of which Rs. 50,53.78 lacs (2010 - Rs 59,11.78 lacs) are outstanding as of date. These bank guarantees are secured by hypothecation to and in favour of the bank of the Company's entire book debts [present and future], outstanding moneys, engagements, securities, investments and rights and further secured by personal guarantee of Whole-Time Directors.

ii) Capital commitment and guarantees on behalf of subsidiary -

The Company's wholly owned subsidiary, Dolphin Offshore Enterprises (Mauritius) Private Limited is currently investing in a ship building programme worth US$ 45.90 million. This Capital expenditure is being met through unsecured interest free loan of US$ 20 million given by the Company and US$ 25.90 million from term loans.

In addition, the Company has given a corporate guarantee to the lenders of Dolphin Offshore Enterprises (Mauritius) Private Limited for US$ 25.90 million (2010 - US$ 20.00 million). Out of the additional guarantee of US $ 5.90 million given during the year, Dolphin Offshore Enterprises (Mauritius) Private Limited has utilized Guarantee of US$ 1.61 million.

As at March 31, 2011, the Company had already given unsecured loan of Rs. 78,90.08 lacs, equivalent to US$ 17.69 million (2010 - Rs. 72,85.26 lacs- equivalent to US$ 16.11 million) and the balance will be paid during the future financial years.

iii) The Company has appealed the award of the CIT(Appeals) on the block assessment of the Company under Sec. 158BC of Income Tax Act, 1961 raising a demand of Rs. 52.97 lacs (2010 - Rs. 52.97 lacs).

The appeal filed against the disallowance of shipping reserve for A.Y. 1998-99 to A.Y. 2004-05 has been decided in favour of company by ITAT, Mumbai. The order giving effect to the said appellate order is awaited.

During the year the company has preferred an appeal with ITAT, Mumbai against the order of CIT (A) disallowing dry- docking charges for A.Y. 2005-06 amounting to Rs. 24.94 Lacs.

The company has filed an appeal with the CIT (A) against the penalty levied under section 271(1)(c) for A.Y. 1998-99 to A.Y. 2004-05.

D. Borrowing cost:

As stated in Schedule 18A (a), financing costs incurred up to the date the asset is ready to be used is included in the cost of the asset, if they are significant.

E. Segment reporting:

The Company is mainly engaged in offshore business and there are no separate reportable segments as per Accounting Standard (AS-17).

F. Related Party Disclosures:

Related party transactions cover transactions between the Company and the following persons in accordance with the Accounting Standard (AS-18) notified pursuant to Companies (Accounting Standards) Rules, 2006.

1) Related party relationships:

(As identified by the management)

a) Companies under common control, including subsidiaries:

i) Dolphin Offshore Projects Limited - under common control

ii) Kanika Shipping Limited - under common control

iii) Global Dolphin Drilling Co. Limited - 59.96% subsidiary

iv) Dolphin Offshore Enterprises (Mauritius) Private Limited - 100.00% subsidiary

v) Dolphin International Risk Services Limited - 99.99% subsidiary

vi) Dolphin Offshore Shipping Limited - 100.00% subsidiary

vii) IMPaC Oil & Gas Engineering (India) Pvt. Limited - 40% Joint Venture

b) Key Management Personnel

i) Rear Admiral Kirpal Singh - Executive Chairman

ii) Mr. Satpal Singh - Managing Director

iii) Mr. Navpreet Singh - Joint Managing Director

c) Relatives of Key Management Personnel with whom the Company has had transactions during the year.

i) Mrs. Manjit Kirpal Singh

ii) Mrs. Prabha Chandran

iii) Mrs. Nitu Singh

iv) Ms. Rishma Singh

v) Master Rohan Singh

vi) Mrs. Ritu Singh

vii) Master Tarun Singh

viii) Master Akhil Singh

G. Hire Purchase Agreements:

The Company has purchased assets under hire purchase arrangements which are repayable within three years from the dates of agreement. During the year, the Company has paid instalments of Rs.10.77 lacs (2010 – Rs. 42.66 lacs). The Company has a future liability of Rs. Nil (2010 – Rs 10.77 lacs) towards the said agreements, of which Rs. Nil (2010 - Rs. 10.77 lacs) is payable within one year.

H. Operating Lease commitments:

b. Lease payments recognised in the statement of Profit & Loss for the period is Rs. 2,19.15 Lacs.

M. Issue of shares:

During the year, the Company received notice from FCCB holders for conversion of 3,602 bonds of US$ 1000 each. Consequently, 10.15 Lacs equity shares of Rs.10/- each have been issued resulting in increase in equity share capital by Rs. 101.50 Lacs and share premium by Rs. 15,32.72 Lacs.

O. Micro, Small and Medium Enterprises (MSMEs):

To the extent information is available with the Company; there are no dues payable to any parties identified as Micro and Small Enterprises as per The Micro, Small and Medium Enterprises Development Act, 2006.

P. Debtors and Creditors:

a. Balances in respect of creditors and debtors are subject to confirmation/reconciliation, wherever required.

b. Sundry debtors includes amount outstanding from a customer amounting to Rs. 47.90 crores. This relates to a subcontract job done during 2006-07 and amount outstanding relates to change order which is still under process of resolution by the ultimate client. Management believes that this amount will be received and hence no provision has been made in the books till date.

c. During the course of execution of its EPC contracts, the Company has undertaken additional work which the Company can invoice only after the contracts have been completed and change orders agreed to by the clients. Due to this reason and other delays not attributable to the Company, the Company expects the liquidated damages of Rs. 28.30 Crores currently levied will be waived by its clients. Accordingly, liquidated damages of Rs. 28.30 Crores have not been provided.

d. During the year, the Company has incurred additional expenditure on executing additional work under its EPC contracts. The Company has quantified and submitted some of its claims for extra work done and has commenced discussions with the clients for finalising the same. However, as a matter of abundant caution, only a portion of these extra claims amounting to Rs. 33.59 crores have been recognised as revenue. The balance of the additional claims will be recognised as revenues as and when the same are quantified and submitted to the clients.

Q. Prior year comparatives:

The prior year figures have been reclassified wherever necessary for comparative purposes.


Mar 31, 2010

A. Contingent Liabilities:

i) On December 22, 2005, the Company has issued 0.5% Foreign Currency Convertible Bonds which - are due for redemption on December 23, 2010 unless the bond holders exercise their option to convert these bonds into equity shares. As at 31.03.2010, there is an unrealised gain in foreign exchange of Rs.1.44 lacs (2009 - Loss of Rs. 6,97.20 lacs) on value of bonds, while the yield till 31s1 March 2010 is Rs.4,61.08 lacs (2009 - Rs.12,88,05 lacs).

ii) As at March 31, 2010 the Company had contingent liabilities in respect of bank guarantees, issued to their customers of Rs.59,79.13 lacs (2009 - Rs.58,77.57 lacs) of which Rs. 59,11.78 lacs (2009 - Rs. 57,14.03 lacs) are outstanding as of date. These bank guarantees are secured by hypothecation to and in favour of the bank of the Companys entire book debts [present and future], outstanding moneys, engagements, securities, investments and rights and further secured by personal guarantee of Whole-time Directors.

iii) Capital commitment and guarantees on behalf of subsidiary -

The Companys wholly owned subsidiary, Dolphin Offshore Enterprises (Mauritius) Private Limited is currently investing in a ship building programme worth US$ 40 million. This Capital expenditure is being met through unsecured interest free loan of US$ 20 million given by the Company and US$ 20 million from term loans. In addition, the Company has given a corporate guarantee to the lenders of Dolphin Offshore Enterprises (Mauritius) Private Limited for US$ 20 million (2009 - US$ 20 million)

As at March 31, 2010, the Company had already given unsecured loan of US$ 16.11 million (2009- US$ 12.54 million) and the balance will be paid during the future financial years.

iv) The Company has appealed the award of the Income Tax Appellate Tribunal (ITAT) on the block assessment of the Company under Sec.158BC of Income Tax Act 1961 raising a demand of Rs 52.97 lacs (2009 - Rs 52.97 lacs).The appeal filed against the disallowance of shipping reserve for A.Y. 1998-99 to A.Y. 2004-05 has been decided in favour of company.The final notice giving effect to this order is awaited.

During the year the company has referred to the tribunal against the order ofCIT (A) disallowing dry-docking charges for A.Y. 2005-06 amounting to Rs. 24.94 Lacs.

The company has filed an appeal with the CIT(A) against the penalty levied under section 271(1)(c) for A.Y. 1998-99 to A.Y. 2004-05, which was decided in our favour except for the deduction claimed u/s 35D for which the matter has been referred to ITAT. Any laibility arising in respect of the above matter will be booked on completion of the proceedings.

b. Segment reporting:

The Company is mainly engaged in Offshore business and there are no separate reportable segments as per Accounting Standard (AS-17).

c. Related Party Disclosures:

Related party transactions cover transactions between the Company and the following persons in accordance with the Accounting Standard 18 notified pursuant to Companies (Accounting standards) Rules, 2006.

d. Hire Purchase Agreements:

The Company has purchased assets under hire purchase arrangements which are repayable within three years from the dates of agreement. During the year, the Company has paid instalments of Rs. 42.66 lacs (2009 - Rs.47.42 lacs). The Company has a future liability of Rs. 10.90 lacs (2009 - Rs 57.70 lacs) towards the said agreements, of which Rs 10.90 lacs (2009 - Rs. 46.80 lacs) is payable within one year.

e. Micro, Small and Medium Enterprises (MSMEs)

To the extent information is available with the Company, there are no dues payable to any parties identified as Micro, Small or Medium Enterprises as per The Micro, Small and Medium Enterprises Development Act, 2006.

f. Debtors and Creditors

a. Balances in respect of creditors and debtors are subject to confirmation/reconciliation, wherever required.

b. Sundry debtors includes amount outstanding from a customer amounting to Rs. 47.90 crores. This relates to a subcontract job done during 2006-07 and amount outstanding relates to change orders which is still under process of resolution by the ultimate client. Management believes that this amount will be received and hence no provision has been made in the books till date.

c. During the course of execution of its EPC contracts, the Company has undertaken additional work which the Company can invoice only after the contracts have been completed and change orders agreed to by the clients. Due to this reason and other delays not attributable to the Company, the Company expects the liquidated damages of Rs. 23.89 Crores currently leived will be waived by its clients. Accordingly, liquidated damages of Rs. 23.89 Crores have not been provided.

g. Prior year comparatives:

The prior year figures have been reclassified wherever necessary for comparative purposes.

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