Notes to Accounts of Ledo Tea Company Ltd.

Mar 31, 2015

1. Corporate information

Ledo Tea Company Limited is a public limited company domiciled in India and incorporated in 1983 under the Provisions of the Companies Act,1956.Its shares are listed with Bombay Stock Exchange Limited of India.

It is engaged in the business of manufacturing of tea and having its tea estate in Tinsukia district of Assam. The estate has a processing factory capable of producing CTC tea with an installed capacity of 1,100 tones.

2. Employee Benefits

As on 31st March 2015 provision amounting to Rs. 40.06 Lacs(P.Y Rs. 29.10 lacs) has not been made in respect of present liabilities for future payment of gratuity to the staff and workers, which will be charged to accounts as and when paid. According to acturial valuation under Revised AS-15, the liability for gratuity obligation to staff and workers as on 31st March, 2015 is Rs. 113.75 Lacs (Previous Year Rs. 102.79 lacs)

3. The Company has charged depreciation based on the revised remaining useful life of the assets as per the requirement of the Schedule II of the Companies Act, 2013 effected from 1st April 2014. The consequential impact on the depreciation

4 Further to 2(p) above, the Company has assessed recoverable value of cash generating unit based on value in use method which has been worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This further confirmed absence of exigency of making any provision against impairment loss.

5. The Company has not received the required information from creditors regarding their status under The Micro, Small and Medium Enterprises Development Act. 2006. Hence disclosure, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been made.

6. Previous year's figures have been re-grouped and/or re-arranged wherever necessary, to confirm the current year classification.

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Mar 31, 2014

1. Corporate information

Ledo Tea Company Limited is a public limited company domiciled in India and incorporated in 1983 under the Provisions of the Companies Act, 1956. Its shares are listed with Bombay Stock Exchange of India.

It is engaged in the business of manufacturing of tea and having its tea estate in Tinsukia district of Assam.The estate has a processing factory capable of producing CTC tea with an installed capacity of 1,100 tonnes.

2. Employee Benefits

As on 31st March 2014 provision amounting to Rs. 29.10 Lacs (RY. Rs. 27.76 Lacs) has not been made in respect of present liabilities for future payment of gratuity to the staff and workers, which will be charged to accounts as and when paid. According to acturial valuation under Revised AS-15, the liability for gratuity obligation to staff and workers as on 31 st March, 2014 is Rs. 102.79 Lacs (Previous Year Rs. 101.45 Lacs).

3. Related party Disclosures

(a) Name of the related parties and related party relationship :

Key Management Personnel : Sri Nirmal Kumar Lohia (Chairman cum-Managing Director)

Relative of Key Management Personnel : Sri Nirmit Lohia (Director)

4. Contingent Liabilities not provided for in respect of :

(Rs. In Lacs) Particulars 2013-14 2012-13

i) Excise B2 Bond executed in favour of Central Excise Authority 0.60 0.60

ii) Disputed Income Tax Demand - 10.66

(The order of the Tribunal vide order dated 23.04.2010 received in favour of Company.However,effect is still awaited)

iii) Disputed Sales tax demand (*) 12.44 8.93

(*) (a) Bank guarantee of Rs. 2,25,000 has been furnished on 14.05.2013 for filling appeal, (b) Amount of Rs. 0.88 Lacs paid as 25% of demand for assessment Year 2010-11.

5. Further to 2(p) above, the Company has assessed recoverable value of cash generating unit based on value in use method which has been worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price.

This further confirmed absence of exigency of making any provision against impairment loss.

6. Previous year''s figures

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

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Mar 31, 2013

1. Corporate information

Ledo Tea Company Limited is a public limited company domiciled in India and incorporated in 1983 under the Provisions of the Companies Act,1956.Its shares are listed with Bombay Stock Exchange of India.

It is engagecJ in the business of manufacturing of tea and having its tea estate in Tinsukia district of Assam. The estate has a processing factory capable of producing CTC tea with an installed capacity of 1,100 tonnes.

2. Employee Benefits

During the year part provision amounting to Rs. 27.76 lacs has not been made in respect of present liabilities for future payment of gratuity to the staff and workers, which will be charged to accounts as and when paid. According to acturial valuation under Revised AS-15, the liability for gratuity obligation to staff and workers as on 31 st March, 2013 is Rs. 101.45 lacs (Previous Year Rs. 73.69 lacs)

3. Further to 2(p) above, the Company has assessed recoverable value of cash generating unit based on value in use method which has been worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price.

This further confirmed absence of exigency of making any provision against impairment loss.

4. Previous year''s figures

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

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Mar 31, 2012

1. Corporate information

Ledo Tea Company Limited is a public limited company domiciled in India and incorporated in 1983 under the Provisions of the Companies Act, 1956. Its shares are listed with Bombay Stock Exchange of India.

It is engaged in the business of manufacturing of tea and having its tea estate in Tinsukia district of Assam.The estate has a processing factory capable of producing CTC tea with an installed capacity of 1,100 tonnes.

(a) There is no movement in share capital as compared to previous year

(b) Terms/rights attached to equity shares

(i) The company has only one class of equity shares having par value of Rs 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividend in Indian Rupees.

(ii) In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of equity shares held by the shareholders.

(i) Term loans are secured by extention of Mortgage charge

(ii) Term loans are secured by Equitable Mortgage Second charge or Pari passu charges on the Fixed assets (i.e,immovable properties including machinery)

(iii) Vehicle Loan are secured against hypothecation of Vehicles purchased against such loan

2. Employee Benefits

The Company has a defined benefit gratuity plan. The scheme is funded with Life Insurance Corporation of India in form of qualifying insurance policy. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to built up the final obligation.

a) The provision of Rs. 2.51 Lacs ( Previous Year Rs.0.70 lacs) for leave encashment has been made by the company during the year on the basis of encashable leave available to each employee at the end of the year.

3. Contingent Liabilities not provided for in respect of:

(Rs. In Lacs)

Particulars 2011-12 2010-11

Excise B2 Bond executed in favour of Central Excise Authority 0.60 0.60

Disputed Income Tax Demand 10.75 10.75 (The order of the Tribunal vide order dated 23.04.2010 received in favour of Company.However,effect is still awaited)

4 Further to 2(p) above, the Company has assessed recoverable value of cash generating unit based on value in use method which has been worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price.

This further confirmed absence of exigency of making any provision against impairment loss.

5. Previous year''s figures

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

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Mar 31, 2010

01. Contingent Liability not provided for: 2009-2010 2008-2009

Rs. Rs.

Excise B2 Bond executed in favour of Central Excise Authority 60,000 60,000

Claims not acknowledged as debts - 2,27,181

Disputed IncomeTax Demand under Appeals** 10,75,450 10,75,450

(**The Tribunal has decided the matter in favour of the Company. However, the effect of the order is yet to be given by the assessing officer.)

02. Stock of tea includes 61,217 Kgs. valuing Rs. 47,56,062/- lying with other parties (Previous year 40,200 Kgs. amounting to Rs. 29,67,564/-)

03. In the opinion of the Board of Directors of the Company the current assets, advances and deposits are approximately of the value stated in the accounts, if realised, in the ordinary course of business unless otherwise stated. The provisions for all known liabilities are adequate and not in excess of the amount reasonably necessary.

04. Bonus & Entry Tax includes Rs. 81,257/- (Previous year Rs. 24,387/-) & Rs. 5,459/- (Previous Year Rs. Nil) respectively related to earlier years.

05. a) Particulars of small scale industries have been furnished to the extent such parties have been identified on the basis of information available with the Company.

The Parties to whom the Company owes any sum which is outstanding as on 31 -03-2010 for more than 30 days are:

Harinder Mechanical Works CM. HO & Co. Bhowel Electricals Bordubi Engineering Works

b) The Company has not received any information from its suppliers regarding registration under "The Micro, Small and Medium Enterprises Development Act, 2006". Hence, the information required to be given in accordance with Section 22 of the said Act, is not ascertainable. Hence, not disclosed.

06. There is no amount due and outstanding to be credited to Investor Education and Protection Fund.

07. In accordance with Accounting Standard 22 "Accounting for taxes on income" issued by the ICAI the Company has reviewed the statement of deferred tax as at 31 st March, 2010 and net deferred tax assets of (Rs. 9,06,757/-) has been recognised in the Profit and Loss account in view of certainty of profit in the coming years.

08. As per the provision of Section 115JAA, MAT Credit receivable has been recognized on the basis of return of income filed for the previous years. MAT credit is recognised as an asset to the extent there is convincing evidence that the Company will pay normal Income Tax during the specified period. MAT credit is recognised as an asset in accordance with the recommendation contained in guidance note issued by the Institute of Chartered Accountants of India. The said assets is created by the way of credit to the Profit and Loss Account and shown as MAT Credit Entitlement. The company will review the same at each balance sheet date and write down the carrying amount of MAT credit entitlement to the extent there is no longer convincing evidence to the effect that the company will pay normal Income Tax during the specified period.

09. The disclosures required under Accounting Standard 15 ( Revised 2005 ) "Employee Benefits" notified in the Companies (Accounting Standards) Rules, 2006, are given below:

Defined Contribution Plan

Employers Contribution to Provident Fund & Family Pension Fund 17,43,994/-

Employees Contribution to Provident Fund & Family Pension Fund 17,43,994/-

Defined Benefit Plan

The employees gratuity fund scheme managed by Life Insurance Corporation of India is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit method, which recognises each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to built up the final obligation.

The estimates of rate of escalation in salary considered in actuarial valuation, taken into account inflation, seniority, promotion and other relevant factors including supply and demand in the employment market. The above information is certified by the actuary.

f) The provision of Rs. 1,78,804/- (P.Y. Rs. 2,89,328/-) for leave encashment has been made by the company during the year on the basis of encashable leave available to each employee at the end of the year.

10. Further to Para A(17) above, the Company has assessed recoverable value of cash generating unit based on value in use method which has been worked out to be much higher than corresponding book value of net assets thereby not warranting further exercise of arriving at their net selling price. This, further confirmed absence of exigency of making any provision against impairment loss.

11. The operation of the Company related only in one business segment viz. Tea and have its production facilities and all other assets located in India.

12. Earning Per Share:

13. Additional information pursuant to the Provision of Paragraphs 3, 4C and 4D of Part II of Schedule VI of the Companies Act, 1956:

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

15. Cash Flow Statement is prepared in accordance with the format prescribed by Securities & Exchange Board of India and as per Accounting Standard - 3 prescribed by the Institute of Chartered Accountants of India on Indirect Method.