Mar 31, 2023
a. Out of total land of 2541.82 acres, land measuring 325.70 acres at Nangal ('' 0.12 crore) had been symbolically possessed by the Punjab Government on 29.10.1998 without determination of consideration. Though the title of entire land including 325.70 acre vests with the Company in the records, the physical possession of 325.70 acres of land is not with the Company. Further, there is a litigation in respect of land measuring 1.7 acres approx. before Punjab & Haryana High Court, Chandigarh. The Regular Second Appeal (RSA) preferred by appellant is pending wherein Hon''ble High Court has ordered status-quo in the matter.
b. Ammonia Feed Stock Conversion Projects from ''LSHS/FO'' to ''Gas'' at Bathinda, Panipat & Nangal Unit under Government''s policy for reimbursement of project cost to the Company over a period of five years from the date of commercial production have been capitalised on 11th March.2013, 28th March 2013 and 18th July 2013 respectively. Accordingly, Property, Plant & Equipment (Gross) include assets amounting to ''3890.17 crore (CPLY ''3890.68 crore) represented by capital grant as disclosed in Note: 26 & 34 relating to Deferred Government Grant and the net Property, Plant & Equipment of Ammonia Feed Stock Conversion Projects amount to ''1925.20 crore (CPLY ''2115.66 crore) as on 31.03.2023.
c. In terms of exemption granted under Ind AS 101, the company has opted to treat exchange difference arising from translation of long term foreign currency monetary items as addition/deletion to Property, Plant & Equipment. Accordingly, an exchange loss/(gain) of '' Nil crore (CPLY gain of '' Nil crore) has been included in the addition to Property, Plant & Equipment as on 31st March, 2023. The unamortized amount of exchange difference as on 31.03.2023 is ''56.12 crore (CPLY ''59.81 crore).
d. During the year, on 9th January 2023, Gas Turbine Generator (GTG) along with HRSG (Heat Recovery Steam Generator), a major part of PPE, installed at Bathinda Unit tripped during normal plant operation and a major component of GTG unit got completely damaged. After technical inspection by the OEM and as estimated by OEM and the company, 55% of the total cost of GTG plant needs replacement.
Accordingly, Gross Carrying amount of Rs. 73.58 Crores having a written down value (WDV) of Rs 67.65 crore, has been derecognized from ""Property Plant & Equipment"" in the financial statements for the FY 2022-23 and estimated salvage value of the damaged component amounting to Rs. 0.22 Crore has been considered as ""Non-Current Asset held for Sale"" w.e.f. 9th January 2023."
e. The Gross Carrying Amount and the Net Carrying Amount of Bearer Plant is ''1404/-. Hence, Nil due to rounding off.
f. Title deeds of following Immoveable Properties are not held in the name of the Company:
Terms/Rights attached to equity shares
The Company has only one class of equity share having a face value of Rs. 10 per share. Each holder of equity share is entitled to one vote per share and entitled to dividends. The dividend proposed by the Board of Director is subject to approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend, which is approved by the Board of Directors. In the event of liquidation of the company, the holders of equity share will be entitled to receive the remaining assets of the company, after distribution to creditors and all preferential amounts. The distribution will be in proportion to the number of equity shares held by each shareholder.
To meet the funding requirement of Energy Saving and other Capex Schemes, the company has entered into a Rupee Term Loan Agreement with SBI on 24.12.2018 for '' 1044 crore.
The borrowings of Rupee Term loan is secured by first pari-passu charge on the fixed assets (both movable and immovable) of the manufacturing units i.e. Nangal, Bathinda, Panipat, Vijaipur - I & Vijaipur - II and Corporate Office and over cash flow of the company.
A sum of '' 639.11 crore is outstanding as on 31.03.2023 out of which instalment due for payment upto 31st March 2024 amounting to '' 104.40 crore is disclosed on Note: 29 - Borrowings.
Repayment of sanctioned term loan would be repayable in 40 quarterly instalments of '' 26.10 crore each started from June 2020 and ending in March 2030. The rate of interest on the term loan is 6 months SBI MCLR plus spread of 0.15%. During the year, for the period upto 29th June 2022, interest Rate was 7.10 % p.a, from 30th June 2022 to 29th December 2022, interest rate was 7.50%, and from 30th December 2022 onwards, interest Rate was 8.45%.
# Includes Capital Grant from Govt. of India, Ministry of Chemicals & Fertilizers for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/FO'' to ''Gas'' vide sanction letter no. 14016/2/2007-FP(Vol.M)(2) dated 08.02.2010 for Panipat Unit, sanction letter no.14016/2/2007-FP (Vol. II)(1) dated 08.02.2010 for Bathinda Unit and sanction letter no.14016/2/2007-FP (Vol. II)(3) dated 08.02.2010 for Nangal Unit. The grant has been accordingly accounted for as per Ind AS 20 Accounting for Government Grants''.
* Represents addition / adjustment to Property, Plant & Equipment in respect of Ammonia Feed Stock Conversion Projects from ''LSHS/FO'' to ''Gas'' at Bathinda, Panipat and Nangal units.
* Cash credit / Working Capital Demand Loan from Banks are secured by first charge ranking pari-pasu inter-se against hypothecation on the whole of the current assets of the borrower namely, Stocks of Raw Materials, Stocks in Process, Semi Finished and Finished Goods, Stores and Spares not relating to Plant & Machinery (Consumable Stores and Spares), Bills receivables and book debts and all other moveables, both present and future of the company.
$ Details in respect of Interest and terms of repayment of Rupee Term Loan are disclosed in Note : 22 Borrowings.
Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts
# The Capital Grant from Govt. of India, Ministry of Chemicals & Fertilizers for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/FO'' to ''Gas'' vide sanction letter no. 14016/2/2007-FP(Vol.M)(2) dated 08.02.2010 for Panipat Unit, sanction letter no.14016/2/2007-FP (Vol. II)(1) dated 08.02.2010 for Bathinda Unit and sanction letter no.14016/2/2007-FP (Vol. II)(3) dated 08.02.2010 for Nangal Unit. The grant has been accordingly accounted for as per Ind AS 20 Accounting for Government Grants''.
Non Current Deferred Government Grant is disclosed in Note No. 26.
Revenue from operations (gross) (a) (b)
$ Subsidy includes Past Period Subsidy and differential amount for the earlier years notified during the current year
Pending sale of urea and P&K fertilizer totalling 10.616 lakh MT through POS device to beneficiaries as on 31.03.2023, subsidy of ''3896.87 crore which has accrued on sale to dealers but shall become due for payment under DBT upon sale through POS device has been recognized in the current period (CPLY quantities 5.24 lakh MT and subsidy ''1064.65 crore).
Pursuant to Department of Fertilizers notification dated 18-11-2022 conveying the extension of Revised Energy Norms of NUP-2015 for 14 Urea Manufacturing Units including 4 units of NFL i.e. Nangal, Bathinda, Panipat and Vijaipur-I, the Revenue from Operations for the current year includes estimated differential subsidy receivable for the period from 01-10-2020 to 31-03-2023 amounting to '' 928.37 crore which includes a sum of '' 211.29 crore for the FY 2022-23.
The Provident Fund contributions are made to a Trust. The interest rate payable to the members of the Trust shall not be lower than statutory rate of interest declared by the Central Government under the Employees Provident Funds and Miscellaneous Provisions Act, 1952.
During the year an amount of '' 37.20 crore (CPLY '' 36.46 crore) has been charged to statement of Profit and loss towards contribution by the Company.
The Provident Fund Trust set up by the Company is treated as Defined Benefit Plan since the Company has to meet the shortfall in the fund assets, if any. Further, having regard to the assets of the Fund and the Return on the Investments, the Company does not expect any deficiency in the foreseeable future. In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability and determined that there is no shortfall as at 31st March, 2023.
The funds of the trust have been invested under various securities as prescribed by regulatory authorities.
a The Company has funded the gratuity liability through a separate Gratuity Fund. The fair value of the plan assets is mainly based on the information given by the insurance companies through whom the investment has been made by the fund. Gratuity liability of '' 56.65 crore (CPLY '' 190.64 crore) is unfunded as on 31st March, 2023. Other defined benefit obligations are unfunded.
51.1.4 Other Employee Benefit Schemes:
Provision of '' (0.40) crore (CPLY '' 0.27 crore) towards Employees'' Family Economic Rehabilitation Scheme and Social Security Benefits Scheme has been charged on the basis of actuarial valuation and credited to the Statement of Profit and Loss account. A net liability of '' 15.96 crore (CPLY '' 16.36 crore) has been recognized in the Balance Sheet as at 31st March 2023 on account of these schemes.
12% of Basic Pay plus Dearness Allowance contributed to the Provident Fund Trust of the Company. The Company does not anticipate any further obligation in the near foreseeable future having regard to the amount of the fund and return on investment as confirmed by the actuary.
The Employee benefit of Provident Fund is administered through a separate NFL Employees Provident Fund Trust. Out of the investment made by PF trust in the past, one issuer of security has defaulted in payments. The value of Investment is '' 15.20 crore. Considering the Employers obligation to make good the loss in value of investment under Provident Fund Regulations, pending assessment of actual loss the Company has provided for 100% of value of investment amounting to '' 15.20 crore in the books of accounts.
Note 52 : Ind AS-108: Operating Segments
Ind AS-108 establishes standards for the way that public business enterprises report information about operating segments and related disclosures about product and services, geographical areas and major customers.
Company''s primary business segments are
i) Own Fertilizers ( Urea, Bio Fertilizers and Bentonite Sulphur)
ii) Fertilizers Trading (Indigenous and Imported)
iii) Other Products & Services (Industrial Products, Agro Chemicals, Traded Seeds, Seeds under Seeds Multiplication Programme), and are reportable segments under Ind AS 108. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (CODM).
D) Transactions with Related parties:
(i) During the year, there were transactions of '' 698.08 crore (CPLY '' 407.53 crore) with Ramagundam Fertilizers & Chemicals Limited towards subscription of Share capital of '' Nil crore (CPLY '' 43.83 crore) and others '' 698.08 crore (CPLY '' 363.70 crore). The amount recoverable from Ramagundam Fertilizers & Chemicals Limited as on 31.03.2023 is '' 113.29 crore (CPLY '' 47.83 crore) and amount payable to Ramagundam Fertilizers & Chemicals Limited as on 31.03.2023 is '' 140.51 crore (CPLY '' 50.21 crore)
(ii) Remuneration to Key Management Personnel at (C) above is '' 1.92 crore (CPLY '' 2.18 crore). In addition to the above, they are eligible for non monetary perquisites as per Government of India guidelines.
In accordance with Ind AS-36, the carrying amount of Property, Plant & Equipment have been reviewed at year-end for indication of impairment loss, if any, by considering assets of entire one plant as Cash Generating Unit. As there is no indication of impairment, no loss has been recognized during the year.
As per requirements of the listing agreements with the stock exchanges, the requisite details of loans and advances in the nature of loans given by the Company are as under:
(i) There are no loans and advances in the nature of loans to any subsidiary.
(ii) No loans have been given (other than loans to employees), wherein there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to firms/companies in which Directors are interested.
Misappropriation of seeds stock amount to Rs 0.64 crore by a âWheat Seed Producer'' under Warehousing and Processing of Wheat seed Agreement with the company has been reported in FY 2022-23 and police compliant has been filed. This amount has been debited to the Wheat Seed producer. Due to uncertainty of recovery, provision for doubtful recoverable amounting to Rs 0.58 crore after adjustment of advance and security deposit has been created in the Books of Accounts.
'' 1.32 crore towards unspent amount of "Ongoing Project" has been transferred to a separate Bank Account as per the provisions of Section 135 (6) of the Companies Act, 2013.
Further, '' 22,365 towards unspent amount of âOther than Ongoing Project" shall be transferred to a fund specified in Schedule VII within a period of six months from the expiry of the financial year as per provisions of Section 135 (5) of the Companies Act, 2013.
Note 58-Remittance in foreign currencies for dividends
The Company has not paid any Dividend during Financial Year 2022-23.
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 (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) 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, contingent consideration and indemnification asset included in level 3.
There are no transfers between levels 1 and 2 during the year.
The company''s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
(ii) Valuation technique used to determine fair value
Specific valuation techniques used to value financial instruments include:
- the use of quoted market prices or dealer quotes for similar instruments
- the fair value of foreign currency option contracts is determined using Black Scholes valuation model.
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.
All of the resulting fair value estimates are included in level 3.
The carrying amounts of trade receivables, trade payables, borrowing, cash and cash equivalents and other current financial liabilities are considered to be the same as their fair values, due to their short-term nature.
The fair values for loans and security deposits were calculated based on cash flows discounted using a current lending rate. The discount rate considered for FY 2022-23 is 7.00% (CPLY 7.00%). They are classified as level 3 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are not observable
The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 3 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are not observable
For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.
The company''s risk management is carried out by Forex Risk Management Committee (FRMC) / central treasury department and marketing department under Co''s policies approved by the Board of Directors. FRMC/Treasury identifies, evaluates and hedges financial risks. The Board provides policy for overall risk management, marketing manual, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, derivative financial instruments and investment of excess liquidity.
(A) Credit risk
Credit Risk refers to the risk of default on its obligations resulting in financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to '' 4158.97 crore and '' 2830.16 crore as of March 31, 2023 and March 31, 2022, respectively. Trade receivables mainly constitute subsidy receivable from Government of India and from sale of fertilizers to dealers. Trade receivables from dealers are partially secured. Credit risk is being managed through credit approvals, establishing credit limits and monitoring the creditworthiness of customers to allow credit terms in the normal course of business.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, treasury maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities given below) and cash and cash equivalents on the basis of expected cash flows.
(a) Risk management
The company''s objectives when managing capital are to
⢠safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and
⢠maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt as per guidelines of Government of India
Consistent with others in the industry, the company monitors capital on the basis of the following gearing ratio:
Debt (long term borrowings) divided by
Total ''Equity'' (as shown in the balance sheet).
During the financial year 1995-96, the company had given an advance of '' 130.69 crore (USD 37.62 million) to a foreign supplier M/s. Karsan Daanismanlik Turizm Sanayi Tiracet Ltd STI Turkey (M/s KARSAN) against import of urea, the supplies of which were not received and subsequently the contract was terminated. Pending litigation, a provision for doubtful recovery of advance was created during FY 1996-97 by way of direct appropriation from accumulated profit & loss having no impact on profitability/taxable income for the year 1996-97.
The outstanding amount of advance was shown in accounts under ''Loan and Advances Recoverable by netting off from provision for doubtful recovery created as above. As said provision was not debited to P&L account in that year, provision so created was neither claimed nor added to book profit while computing taxable income for the year 1996-97."
"The net amount of outstanding advance as on 01.04.2021 recoverable of '' 129.64 crore (net of actual recovery of '' 1.05 crore in earlier years) has continued to be shown in the accounts till FY 2021-22 under ''Other Non-Current Assets'' separately indicating the equivalent amount of provision for doubtful advances from reserves and surplus.
Despite ongoing protracted litigation for recovery of advance amount for more than 25 years at various jurisdictional levels, the amount of '' 129.64 crore could not be recovered.
The company, after considering the fact of remote possibility of recovery in future, has decided to write off the outstanding amount of '' 129.64 crore in current financial year."
Consequent to write-off of this amount in current financial year, the provision of '' 129.64 crore made in earlier year(s) has been written back and credited to ''Statement of Profit and Loss''.
Restatement for the year 31st March 2022 and at 01st April 2021
During the financial year 1995-96, the company had given an advance of '' 130.69 crore (USD 37.62 million) to a foreign supplier M/s. Karsan Daanismanlik Turizm Sanayi Tiracet Ltd STI Turkey (M/s KARSAN) against import of urea, the supplies of which were not received and subsequently the contract was terminated. Pending litigation, a provision for doubtful recovery of advance was created during FY 1996-97 by way of direct appropriation from accumulated profit & loss having no impact on profitability/taxable income for the year 1996-97.
"An error had occurred during the FY 1996-97 while creating provision for doubtful recovery of advance which was appropriated directly from Profit & Loss Appropriation Account in place of debiting to the Profit & Loss Account.
The net amount of outstanding advance recoverable of '' 129.64 crore (net of actual recovery of '' 1.05 crore in earlier years) continues to be shown in the accounts under the head ''Other Non-Current Assets'', separately indicating the equivalent amount of provision for doubtful advances."
During the FY 2022-23, the above error has been discovered. Therefore, for making the correction of error in prior period affecting the financial statements, based on opinion of an expert, the company has restated its balance sheet to show the corrected financial position for the prior periods. As per Ind AS8, the correction of a prior period error is excluded from profit & loss for the period in which the error is discovered. Hence, in this respect the company is presenting a third balance sheet as at the beginning of the preceding period i.e 01.04.2021 in addition to the minimum comparative financial statements in this respect.
"In line with the requirements of Ind AS 8, Accounting Policies, Changes in Accounting Estimates and Errors'' and Ind AS 1, ''Presentation of Financial Statements'', the error has been corrected by retrospectively restating the opening balances of assets, liabilities and equity for the earliest period presented i.e. as of 01.04.2021 and 31.03.2022.
There is no impact on EPS of the previous period of the financial statement due to such restatement.
Note No. 64 Additional Regulatory Information
a) Details of Benami Property Held
The Company does not have any benami property, where any proceeding has been initiated or pending against the Company for holding any Benami property:
b) The Company has not been declared willful defaulter by any bank or financial institution or any other lender.
c) There are no material transactions with respect to struck off companies as mentioned under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956.
d) The Company does not have any charges or satisfaction of charges which are yet to be registered with ROC beyond the statutory period
e) Provision regarding the number of layers prescribed under Section of Section 2 (87) of the Act read with the Companies (Restriction on number of layers) Rules, 2017 is not applicable.
f) The Company does not have any transaction 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 Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of Income Tax Act, 1961).
g) The Company has not traded or invested in crypto currency or virtual currency during the respective financial year/period.
h) The Company does not have any scheme of arrangements which have been approved by the Competent Authority in terms of Section 230 to 237 of the Companies Act, 2013
i) 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 like to or on behalf of the Ultimate Beneficiaries.
j) 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 the behalf of the Ultimate Beneficiaries.
The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year
Mar 31, 2018
Dormant Company on 04.11.2015.
# The Total Subsidy Receivable is Rs, 3696.25 crore
The procedure for release of subsidy has been revised with the introduction of Direct Benefit Transfer (DBT) scheme in a phased manner for various fertilizers. As per the earlier procedure 85% to 95% of subsidy to manufacturers was allowed on monthly basis based on receipt of fertilizer in the District and balance 5% (for Urea) and 10% to 15% (P&K) on confirmation of receipt of fertilizer by retailers through FMS amongst other requirements. However, the revised procedure entails 100% payment of subsidy under Direct Benefit Transfer scheme on the basis of actual sale by the retailers to the beneficiaries on weekly basis through PoS machines.
# Includes an advance of Rs,130.69 crore (CPLY Rs, 130.69 crore) given to a foreign supplier M/s. Karsan during the year 1995-96 against import of Urea, the supplies of which were not received and subsequently the contract was terminated. Pending litigation, the net advance of Rs, 129.64 crore (after recovery of Rs,1.05 crore) has been fully provided for in the earlier years from the revenue reserve and surplus.
$ Includes amount recoverable on account of Gas Pooling amounting to Rs, 275.39 crore (CPLY Rs, 116.91 crore)
a. There has been no movement in the Issued, Subscribed and Paid-up capital of the Company during the year.
b. Terms/Rights attached to equity shares
The Company has only one class of equity share having a face value of Rs, 10 per share. Each holder of equity share is entitled to one vote per share and entitled to dividends approved by shareholders.
I n the event of liquidation of the company, the holders of equity share will be entitled to receive remaining assets of the company, after distribution to creditors and all preferential amounts. The distribution will be in proportion to the number of equity shares held by each shareholder.
* In terms of Section 135 of the Companies Act, 2013 read with guidelines on corporate social responsibility issued by Department of Public Enterprises (DPE), GOI, the Company is required to spend, in every financial year, at least two per cent of the average net profits of the Company made during the three immediately preceding financial years in accordance with its CSR Policy. The Company had opening CSR Reserve of Rs, 2.50 crore in respect of unspent CSR budget as per DPE guidelines. Budget of Rs, 4.35 crore was allocated as Companies Act, 2013 for FY 2017-18. The company has incurred an amount of Rs, 2.97 crore during the year ended 31st March, 2018 (CPLY Rs, 2.62 crore) leaving balance CSR fund of Rs, 3.88 crore as on 31st March, 2018.
$ Foreign Currency External Commercial Borrowing (ECB) loan from Bank, has been used for energy saving and urea capacity augmentation projects at Vijaipur and is secured by first ranking pari-passu charge on all movable and immovable Property, Plant & Equipment (both present and future) related to Vijaipur unit and second ranking pari-passu charge on the current assets (both present and future) and subsidy of the Vijaipur Unit.
The ECB was earlier drawn from SBI, NY at rate of interest of 6 months USD LIBOR plus margin of 3.05% p.a. and upfront arrangement fee of 1.58% of facility. ECB has been refinanced through DBS Bank, Singapore on 06.01.2016.
The rate of interest of refinanced ECB from DBS, Singapore is 3 months USD LIBOR plus margin of 1.49% p.a. Repayment of refinanced ECB loan has commenced from FY 2016-17. Foreign Currency External Commercial Borrowing (ECB) loan from DBS Bank is secured by first ranking pari-passu charge on all movable and immovable Property, Plant & Equipment (both present and future) related to Vijaipur unit and second ranking pari-passu charge on the current assets (both present and future) and subsidy of the Vijaipur Unit.
The repayment of ECB loan will fall due for Rs, 55.64 crore in FY 2018-19, Rs, 58.06 crore in FY 2019-20 and Rs, 58.06 crore in FY 2020-21. A sum of Rs, 170.28 crore (Rs, 114.64 crore Rs, 55.64 crore) is outstanding as on 31.03.2018 out of which the installments due for payment upto 31st March, 2019 amounting to Rs, 55.64 crore is disclosed in Note : 28 Other Financial Liabilities.
# The Capital Grant from Govt. of India, Ministry of Chemicals & Fertilizers for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/ FO'' to ''Gas'' vide sanction letter no. 14016/2/2007-FP(Vol.II)(2) dated 8.02.2010 for Panipat Unit, sanction letter no.14016/2/2007-FP (Vol. II)(1) dated 8.02.2010 for Bathinda Unit and sanction letter no.14016/2/2007-FP (Vol. II)(3) dated 8.02.2010 for Nangal Unit has accrued since the conditions attached to the grant have been fulfilled by the Company. The grant has been accordingly accounted for as per Ind AS 20 ''Accounting for Government Grants''. The Government would make payment of the above grant over a period of 5 years from the commencement of commercial production. The actual project cost that would be reimbursed shall be admitted after scrutiny by a team constituted by Government of India. The return on own funds shall be recognized on finalisation of project cost by the Government.
Pending the finalisation of Project Cost, the subsidy recoverable has been adjusted by the subsidy amount received based on notified adhoc special fixed cost rate. Adjustments, if any, on account of final settlement of LSTK (Lump Sum Turn Key) contracts and due to actual sales realization of the redundant assets discarded after conversion will be made in the year of occurrence. While arriving at the amount of grant accrued to the Company, the deduction has been made for the amount of disposable value of discarded assets.
* Represents addition to Property, Plant & Equipment in respect of Ammonia Feed Stock Conversion Projects from ''LSHS/FO'' to ''Gas'' at Bathinda, Panipat and Nangal units.
*Cash credit from Banks are secured by first charge ranking pari-passu inter-se against hypothecation of inventories, book debts and other current assets of the Company.
#Working Capital Demand Loan from Banks are secured by pari-passu charge against hypothecation of Government Subsidy, inventories, book debts and other current assets of the Company.
* Details in respect of Interest and terms of repayment of Foreign Currency Loan are disclosed in Note 20: Borrowings.
# The borrowings of Rupee Term Loan from Banks for Ammonia Feedstock Conversion Projects was paid during the current year. Final Installment payment was made on 31.03.2018. The Loan was secured by first charge ranking pari-passu inter-se on entire Property, Plant & Equipment, movable and immovable (present & future) properties related to Nangal, Bathinda & Panipat units and second charge over the entire current assets and subsidy (excluding reimbursement related to energy savings and interest expenses) of the Company.
$ Includes amount of Rs, 109.95 crore towards liability for pay revision and gratuity.
# The Capital Grant from Govt. of India, Ministry of Chemicals & Fertilizers for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/ FO'' to ''Gas'' vide sanction letter no. 14016/2/2007-FP(Vol.II)(2) dated 8.02.2010 for Panipat Unit, sanction letter no.14016/2/2007-FP (Vol. II)(1) dated 8.02.2010 for Bathinda Unit and sanction letter no.14016/2/2007-FP (Vol. II)(3) dated 8.02.2010 for Nangal Unit has accrued since the conditions attached to the grant have been fulfilled by the Company. The grant has been accordingly accounted for as per Ind AS 20 ''Accounting for Government Grants''. The Government would make payment of the above grant over a period of 5 years from the commencement of commercial production. The actual project cost that would be reimbursed shall be admitted after scrutiny by a team constituted by Government of India. The return on own funds shall be recognized on finalisation of project cost by the Government.
Pending the finalisation of Project Cost, the subsidy recoverable has been adjusted by the subsidy amount received based on notified adhoc special fixed cost rate. Adjustments, if any, on account of final settlement of LSTK (Lump Sum Turn Key) contracts and due to actual sales realization of the redundant assets discarded after conversion will be made in the year of occurrence. While arriving at the amount of grant accrued to the Company, the deduction has been made for the amount of disposable value of discarded assets.
* Represents addition to Property, Plant & Equipment in respect of Ammonia Feed Stock Conversion Projects from ''LSHS/FO'' to ''Gas'' at Bathinda, Panipat and Nangal units.
Non-Current Deferred Government Grant is disclosed in Note No. 23
* An adhoc provision of Rs, 92.95 crore towards liability for pay revision, Rs, 152.75 crore towards liability for Gratuity/EL/HPL, totaling Rs, 245.70 crore (CPLy Rs, 25.20 crore) has been made as per DPE OM dated 03.08.2017. The corresponding liability amounting to Rs, 21.13 crore, Rs, 109.95 crore & Rs, 114.62 crore is disclosed in Note No. 22, 28 and 29 respectively.
# Includes payment of Rs, 2.60 crore (CPLY Rs, 2.45 crore) paid to disabled employees/legal heirs of deceased employees under NFL Employee Family Economic and Social Rehabilitation Scheme.
47.1 Ind AS-19: Employee Benefits
47.1.1 General description of defined benefit schemes:
G . .. Payable on separation @ 15 days pay for each completed year of service subject to maximum of Rs, 20 lakhs to eligible employees who render continuous service of 5 years or more.
Leave Encashment {Earned Leave (EL) and Payable on separation to eligible employees who have accumulated earned leave and Half Pay Leave(HPL)} half pay leave. During the service period encashment of accumulated earned leave is allowed in a financial year leaving minimum balance leave of 10 days.
Long Service Award (LSA) Payable to employees on completion of specified years of service.
Legal heirs of deceased employees and disabled employees (separated) can opt for either of the following two schemes:
Social Security Benefits (SSB) Lump sum benefit payable for left over month of service limited to 60 month pay (maximum
Rs, 9.00 lakhs with minimum benefits of Rs,1.00 lakhs).
Employeesâ Family Economic Rehabilitation Monthly payment along with medical and children education benefits in lieu of prescribed Scheme (EFERS) deposit up to the date of notional superannuation.
47.1.2 Provident Fund: The Provident Fund contributions are made to a Trust administered by the Company. The interest rate payable to the members of the Trust shall not be lower than statutory rate of interest declared by the Central Government under the Employees Provident Funds and Miscellaneous Provisions Act, 1952.
During the year an amount of Rs, 27.05 crore (CPLY Rs, 27.09 crore) has been charged to statement of Profit and loss towards contribution by the Company.
The Provident Fund Trust set up by the Company is treated as Defined Benefit Plan since the Company has to meet the shortfall in the fund assets, if any. Further, having regard to the assets of the Fund and the Return on the Investments, the Company does not expect any deficiency in the foreseeable future. In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability and determined that there is no shortfall as at 31st March, 2018.
The funds of the trust have been invested under various securities as prescribed by regulatory authorities.
Foot Note:
1. The company has funded the gratuity liability through a separate Gratuity Fund. The fair value of the plan assets is mainly based on the information given by the insurance companies through whom the investment has been made by the fund. Gratuity liability of Rs, 181.58 crore (CPLY Rs, 58.17 crore) is unfunded as on 31st March, 2018. Other defined benefit obligations are unfunded.
47.1.4 Other Employee Benefit Schemes:
Provision ofRs, 0.12 crore (CPLY Rs, 0.64 crore) towards Employerâs, Family Economic Rehabilitation Scheme and Social Security Benefits scheme has been made on the basis of actuarial valuation and charged to the Statement of Profit and Loss account. A net liability of '' 15.58 crore (CPLY Rs, 15.70 crore) has been recognized in the Balance Sheet as at 31st March 2018 on account of these schemes.
47.1.5 Provident Fund: 12% of Basic Pay plus Dearness allowance contributed to the Provident Fund Trust of the Company. The Company does not anticipate any further obligation in the near foreseeable future having regard to the amount of the fund and return on investment as confirmed by the actuary.
A) Nature of Relationship Name of the Related Party
Joint Ventures Urvarak Videsh Limited
Ramagundam Fertilizers & Chemicals Limited
B) Nature of Relationship Name of the Related Party
Key Management Personnel (i) Shri Manoj Mishra,
Chairman & Managing Director
(ii) Shri R. K. Chandiok Director (Finance)
(iii) Shri D.S. Ahuja Director (Technical)
(vi) Shri Rajkumar Company Secretary
D) Transactions with Related parties:
(i) During the year, there were transactions of Rs, 70.85 crore (CPLY Rs, 132.42 crore) with Ramagundam Fertilizers & Chemicals Limited towards subscription of Share capital of Rs, 65.25 crore (CPLY Rs, 129.00 crore) and others Rs, 5.60 crore (CPLY Rs, 3.42 crore).
(ii) Remuneration to Key Management Personnel at (B) above is Rs, 1.69 crore (CPLY Rs, 1.52 crore). In addition to the above they are eligible for non-monetary perquisites as per Government of India guidelines.
Note 1: Ind AS-36: Impairment of assets
In accordance with Ind AS-36, the carrying amount of Property, Plant & Equipment have been reviewed at year-end for indication of impairment loss, if any, by considering assets of entire one plant as Cash Generating Unit. As there is no indication of impairment, no loss has been recognized during the year.
Note 2: Assets taken on Operating lease
The Company''s significant leasing arrangements are in respect of operating leases of premises for offices, go downs and residential use of employees & vehicles. These leasing arrangements are usually renewable on mutually agreed terms but are not non-cancellable. Employee benefit expense remuneration and benefits include Rs, 1.13 crore (CPLY Rs, 0.79 crore) towards lease payments, net of recoveries, in respect of premises for residential use of employees. Lease payments in respect of premises for offices, god owns and vehicles, Rs, 13.30 crore (CPLY Rs, 11.94 crore) are shown in Rent (Other Expenses Note: 42).
Note 3: As per requirements of the listing agreements with the stock exchanges, the requisite details of loans and advances in the nature of loans given by the Company are as under:
(i) There are no loans and advances in the nature of loans to any subsidiary
(ii) No loans have been given (other than loans to employees), wherein there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to firms/companies in which Directors are interested.
Note 4: Remittance in foreign currencies for dividends
The Company has not remitted any amount in foreign currencies on account of dividend during the year and does not have information as to the extent to which remittances, if any, in foreign currencies on account of dividends have been made by/on behalf of non-resident shareholders.
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 (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) 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, contingent consideration and indemnification asset included in level 3.
There are no transfers between levels 1 and 2 during the year.
The company''s policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
(ii) Valuation technique used to determine fair value
Specific valuation techniques used to value financial instruments include:
- the use of quoted market prices or dealer quotes for similar instruments
- the fair value of foreign currency option contracts is determined using Black Scholes valuation model.
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.
All of the resulting fair value estimates are included in level 3.
The carrying amounts of trade receivables, trade payables, cash and cash equivalents and other current financial liabilities are considered to be the same as their fair values, due to their short-term nature.
The fair values for loans, security deposits and investment in government securities were calculated based on cash flows discounted using a current lending rate. They are classified as level 2 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are observable.
The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 2 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are not observable.
For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.
Note No. 56 Financial Risk Management
The company''s activities expose it to market risk, liquidity risk and credit risk.
This note explains the sources of risk which the entity is exposed to and how the entity manages the risk and the impact of hedge accounting in the financial statements.
The company''s risk management is carried out by a central treasury department and marketing department under policies approved by the Board of Directors. Treasury identifies, evaluates and hedges financial risks. The board provides written principles for overall risk management, marketing manual, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, derivative financial instruments and investment of excess liquidity.
(A) Credit Risk
Credit Risk refers to the risk of default on its obligations resulting in financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs, 3935.28 crore and Rs, 4267.43 crore as of 31st March, 2018 and 31st March, 2017, respectively. Trade receivables mainly constitute subsidy receivable from Government of India and from sale of fertilizers to dealers. Trade receivables from dealers are partially secured. Credit risk is being managed through credit approvals, establishing credit limits and monitoring the creditworthiness of customers to allow credit terms in the normal course of business.
(B) Liquidity Risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, treasury maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.
Financing arrangements
The company had access to the following undrawn borrowing facilities at the end of the reporting period:
The Bank Overdraft/Cash Credit (CC)/Short term loan (STL) facilities may be drawn at any time and may be called back by the bank at their discretion. The credit facilities of Banks are subject to compliance with sanctioned terms & conditions. The credit facilities have an average maturity of 1 year.
Note No. 5: Capital Management
(a) Risk management
The company''s objectives when managing capital are to
- safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and
- maintain an optimal capital structure to reduce the cost of the capital.
In order to maintain or adjust the capital structure, the company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt as per guidelines of Government of India.
Consistent with others in the industry, the company monitors capital on the basis of the following gearing ratio:
Net debt (total borrowings net of cash and cash equivalents) divided by Total ''equity'' (as shown in the balance sheet).
Note No. 6: Others
The previous year''s figures have been reworked, regrouped, rearranged and reclassified wherever necessary. Amounts and other disclosures for the preceding year are included as an integral part of the current year financial statements and are to be read in relation to the amounts and other disclosures relating to the current year
Mar 31, 2017
Note 1 Ind AS-108: Operating Segments
Ind AS-108 establishes standards for the way that public business enterprises report information about operating segments and related disclosures about product and services, geographical areas and major customers.
Business Segments:
Company''s primary business segments are âUrea'' & âOther Products''(including Industrial Products, Bio Fertilizers and Traded Products) and are reportable segments under Ind AS 108. Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker (CODM).
48.1.1 Geographical Segment:
The operations of the company are conducted within India and there is no separate reportable geographical segment.
Note : 2 Ind AS-24: Related Party Disclosures
A) Nature of Relationship Name of the Related Party
Joint Ventures Urvarak Videsh Limited
Ramagundam Fertilizers & Chemicals Limited
B) Nature of Relationship Name of the Related Party
Key Management Personnel (i) Shri Manoj Mishra,
Chairman & Managing Director
(ii) Shri R. K. Chandiok Director (Finance)
(iii) Shri D.S. Ahuja
Director (Technical) w.e.f 06.02.2017
(iv) Shri M. Sagar Mathew
Director (Technical) upto 31.12.2016
(vi) Shri Rajkumar Company Secretary
D) Transactions with Related parties:
(i) During the year there were transactions of Rs,132.42 crore (previous year Rs,25.38 crore) with Ramagundam Fertilizers & Chemicals Limited towards subscription of Share capital of Rs,129.00 crore (Previous Year Rs,22.00 crore) and others Rs,3.42 crore (Previous Year Rs,3.26 crore).
(ii) Remuneration to Key Management Personnel at B) above is Rs,1.52 crore (Previous period Rs,1.39 crore). In addition to the above they are eligible for non monetary perquisites as per Government of India guidelines.
Note 3 Ind AS-36: Impairment of assets
In accordance with Ind AS-36, the carrying amount of Property, Plant & Equipment have been reviewed at year-end for indication of impairment loss, if any, by considering assets of entire one plant as Cash Generating Unit. As there is no indication of impairment, no loss has been recognized during the year.
Note 4 Assets taken on Operating lease:
The Company''s significant leasing arrangements are in respect of operating leases of premises for offices, god owns and residential use of employees & vehicles. These leasing arrangements are usually renewable on mutually agreed terms but are not non-cancellable. Employee benefit expense remuneration and benefits include Rs, 0.79 crore (Previous year Rs,0.49 crore) towards lease payments, net of recoveries, in respect of premises for residential use of employees. Lease payments in respect of premises for offices, godowns and vehicles, Rs,11.94 crore (Previous year Rs,3.52 crore) are shown in Rent (other expenses Note: 42).
Note 5 As per requirements of the listing agreements with the stock exchanges, the requisite details of loans and advances in the nature of loans given by the Company are as under:
(i) There are no loans and advances in the nature of loans to any subsidiary.
(ii) No loans have been given (other than loans to employees), wherein there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to firms/companies in which Directors are interested.
Note 6 Remittance in foreign currencies for dividends
The Company has not remitted any amount in foreign currencies on account of dividend during the year and does not have information as to the extent to which remittances, if any, in foreign currencies on account of dividends have been made by/on behalf of non-resident shareholders.
i) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognized and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.
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 (including bonds) which are traded in the stock exchanges is valued using the closing price as at the reporting period. The mutual funds are valued using the closing NAV.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the-counter derivatives) 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, contingent consideration and indemnification asset included in level 3.
There are no transfers between levels 1 and 2 during the year.
The company''s policy is to recognize transfers into and transfers out of fair value hierarchy levels as at the end of the reporting period.
(ii) Valuation technique used to determine fair value
Specific valuation techniques used to value financial instruments include:
- the use of quoted market prices or dealer quotes for similar instruments
- the fair value of foreign currency option contracts is determined using Black Scholes valuation model.
- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.
All of the resulting fair value estimates are included in level 2
The carrying amounts of trade receivables, trade payables, cash and cash equivalents and other current financial liabilities are considered to be the same as their fair values, due to their short-term nature.
The fair values for loans, security deposits and investment in government securities were calculated based on cash flows discounted using a current lending rate. They are classified as level 2 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are observable.
The fair values of non-current borrowings are based on discounted cash flows using a current borrowing rate. They are classified as level 2 fair values in the fair value hierarchy since significant inputs required to fair value an instrument are observable.
For financial assets and liabilities that are measured at fair value, the carrying amounts are equal to the fair values.
The company''s risk management is carried out by a central treasury department and marketing department under policies approved by the board of directors. Treasury identifies, evaluates and hedges financial risks. The board provides written principles for overall risk management, marketing manual, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, derivative financial instruments and investment of excess liquidity.
(A) Credit risk
Credit Risk refers to the risk of default on its obligations resulting in financial loss. The maximum exposure to the credit risk at the reporting date is primarily from trade receivables amounting to Rs,4274.84 crore and Rs,4802.73 crore as of March 31, 2017 and March 31, 2016, respectively. Trade receivables mainly constitute subsidy receivable from Government of India and from sale of fertilizers to dealers. Trade receivables from dealers are partially secured. Credit risk is being managed through credit approvals, establising credit limits and monitoring the creditworthiness of customers to allow credit terms in the normal course of business
(B) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, treasury maintains flexibility in funding by maintaining availability under committed credit lines. Management monitors rolling forecasts of the company''s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents on the basis of expected cash flows.
Financing arrangements
The company had access to the following undrawn borrowing facilities at the end of the reporting period:
The Bank Overdraft/Cash Credit (CC)/Short term loan (STL) facilities may be drawn at any time and may be called back by the bank at their discretion. The credit facilities of Banks are subject to compliance with sanctioned terms & conditions. The credit facilities have an average maturity of 1 year.
Note 7 Capital Management
(a) Risk Management
The company''s objectives when managing capital are to:-
- safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and
- maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, The company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt as per guidelines of Government of India.
Consistent with others in the industry, The company monitors capital on the basis of the following gearing ratio:
Net debt (total borrowings net of cash and cash equivalents)
divided by
Total ''equity'' (as shown in the balance sheet).
Note No. 8 Ind AS 101
First-time adoption of Ind AS Transition to Ind AS
These are the Company''s first financial statements prepared in accordance with Ind AS.
The accounting policies set out in note 1 have been applied in preparing the financial statements for the year ended 31 March 2017, the comparative information presented in these financial statements for the year ended 31 March 2016 and in the preparation of an opening Ind AS balance sheet at 1 April 2015 (The company''s date of transition). In preparing its opening Ind AS balance sheet, the company has adjusted the amounts reported previously in financial statements prepared in accordance with the accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP).
An explanation of how the transition from previous GAAP to Ind AS has affected The company''s financial position, financial performance and cash flows is set out in the following tables and notes.
A. Exemptions and exceptions availed
Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.
A.1 Ind AS optional exemptions
A.1.1 Deemed cost
Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets and Investment Property covered by Ind AS 40 Investment Properties.
Accordingly, The company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying value.
A 1.2 Long-term foreign currency monetary items
Ind AS 101 includes an optional exemption that allows a first-time adopter to continue the above accounting treatment in respect of the long-term foreign currency monetary items recognized in the financial statements for the period ending immediately before the beginning of the first Ind AS financial reporting period
The company has elected to apply this exemption
A.2 Ind AS mandatory exceptions A.2.1 Estimates
An entity''s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error. Ind AS estimates as at 1 April 2015 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:
A.2.2 De-recognition of financial assets and liabilities
âInd AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 1 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity''s choosing, provided that the information needed to apply Ind AS 109 to financial assets and financial liabilities derecognized as a result of past transactions was obtained at the time of initially accounting for those transactions.
The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS.
A.2.3 Classification and measurement of financial assets
Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date of transition to Ind AS.
Notes
A) (i) During the implementation of the Ind AS, the Company has noted that an employee benefit plan relating to post-retirement medical
benefits was wrongly classified as defined benefit plans instead of defined contribution plan. The Company has rectified the error in the opening balance sheet as at April 1, 2015. Consequent to this rectification, opening reserves of the Company is increased by Rs, 60.25 crores and the profit for the year ended March 31, 2016 has reduced by Rs, 1.59 crores.
ii) During the year ended March 31, 2015, the Company wrongly estimated the amount of freight subsidy receivable from the Government of India. Accordingly, the same has been adjusted in the opening balance sheet. Opening Reserves as at April 1, 2015 are reduced by Rs, 21.95 crores and profit for the year ended March 31, 2016 has reduced by Rs, 2.94 crores
B) Remeasurement of Post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of profit or loss. Under the previous GAAP, these remeasurements were forming part of the profit or loss for the year. As a result of this change, the profit for the year ended March 31, 2016 increased by Rs, 9.82 crore. There is no impact on the total equity as at 31 March 2016.
C) Proposed Dividend
Under the previous GAAP, dividends proposed by the Board of Directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognized as a liability. Under Ind AS, such dividends are recognized when the same is approved by the shareholders in general meeting. Accordingly, the liability for proposed dividend of Rs, 71.44 crore as at March 31, 2016 and Rs, 10.04 crores as at April 1, 2015 included under the provision has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by equivalent amount for these periods.
D) The Company has received certain security deposits from its vendor and EFRS deposits from the employees which were earlier carried at cost. However, now under Ind AS, these deposits have been discounted at their present value at each reporting date and differential of Rs, 5.10 Crores in the opening reserve and Rs, 0.30 crores for March 2016 has been accounted in the Statement of Profit and Loss account.
E) Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognized in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method. Under previous GAAP, these transaction costs were charged to statement of profit or loss on a straight line basis over the tenure of the loan. Accordingly, retained earning has been reduced by Rs, 0.11 crore as at March 31, 2016 (2015 â Rs, 0.32 crore). The profit for the year ended 31 March 2016 increased by Rs, 0.11 crore.
F) Deferred tax has been recognized on the Ind AS adjustments resulting in increase in profit for the year ended March 31,2016 by Rs, 3.40 crores.
G) Ind AS 16 âProperty, Plant and Equipmentsâ requires that all items of spares having a life of more than one year need to be capitalized as part of the Property, Plant and Equipment (PPE). Accordingly, stores and spares which meet the above criteria has been adjusted to PPE and depreciation thereon has been recorded as an expense in the Statement of Profit and Loss Account. Also, certain stores and spares were already booked as repair and maintenance expenses during the financial year 2015-16, the same has now been capitalized.
Accordingly, retained earning for March 2015 and March 2016 is reduced by Rs, 13.84 crore and Rs, 0.76 crore respectively.
Mar 31, 2016
*In view of average loss of ''115.69 crore during preceding three financial years, there is no requirement to spend towards CSR during the year as per Companies Act, 2013. The Company had opening CSR Reserve of Rs.5.26 crore in respect of unspent CSR budget as per DPE guidelines. The company has incurred an amount of Rs.1.25 crore during the year (Previous Year Rs.0.37 crore) towards Corporate Social Responsibility activities leaving balance CSR fund of Rs.4.01 crore as on 31.03.2016.
# As per Office Memorandum F. No. 3(3)-B(S)/2015 dated 5.01.2016 issued by Ministry of Finance, Department of Economic Affairs (DEA) (Budget Division) regarding Dividend Payment of Central Public Sector Enterprises (CPSEs), a CPSE would pay an annual dividend of 30% of Profit after Tax (PAT) or 30% of GOIâs equity, whichever is higher. However, in terms of the provisions contained in the said office Memorandum, Company has requested Department of Fertilizers for exemption from payment of dividend considering the various capex requirements and equity contribution in RFCL. Department of Fertilizers vide their OM No.18048/7/2016-FCA dated 27th April 2016 has recommended to Secretary, Department of Economic Affairs from exemption to NFL for payment of dividend for the next five years. Pending receipt of exemption from Government of India, dividend of 30.11% of PAT has been proposed.
# The Capital Grant from Govt. of India, Ministry of Chemicals & Fertilizers for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/FOâ to ''Gasâ vide sanction letter no. 14016/2/2007-FP(Vol.II)(2) dated 8.02.2010 for Panipat Unit, sanction letter no.14016/2/2007-FP (Vol. II)(1) dated 8.02.2010 for Bathinda Unit and sanction letter no.14016/2/2007-FP (Vol. II)(3) dated 8.02.2010 for Nangal Unit has accrued since the conditions attached to the grant have been fulfilled by the Company. The grant has been accordingly accounted for as per para 6.1 of Accounting Standard -12 on ''Accounting for Government Grantsâ. The Government would make payment of the above grant over a period of 5 years from the commencement of commercial production. The actual project cost that would be reimbursed shall be admitted after scrutiny by a team constituted by Government of India. The return on own funds shall be recognized on finalization of project cost by the Government.
Pending the finalization of Project Cost, the subsidy recoverable has been adjusted by the subsidy amount received based on notified adhoc special fixed cost rate. Adjustments, if any, on account of final settlement of LSTK (Lump Sum Turn Key) contracts and due to actual sales realization of the redundant assets discarded after conversion will be made in the year of occurrence. While arriving at the amount of grant accrued to the Company, the deduction has been made for the amount of disposable value of discarded assets, currently at the written down value of the assets concerned.
^Represents addition to fixed assets in respect of Ammonia Feed Stock Conversion Projects from âLSHS/FOâ to âGasâ at Bathinda, Panipat and Nangal units.
* 1004 Nos 9.42% Secured Redeemable Non-Convertible Bonds (Previous Year 1004 Nos) of Rs.10,00,000/- each issued with five years tenor redeemable at par in three installments at the end of third year from issue date of 15th September, 2011 (30% at end of 3rd year, 30% at the end of 4th year and balance 40% at end of 5th year). These bonds are secured by mortgage/charge on land and building of Company located at Corporate Office, Noida. The final installment of Rs.40.16 crore due for payment on 15.09.2016 is disclosed in Note 11 ''Other Current Liabilities''.
# Rupee loan from Banks for Ammonia Feedstock Conversion Projects is secured by first charge ranking pari-passu inter-se on entire fixed assets, movable and immovable (present & future) properties related to Nangal, Bathinda & Panipat units and second charge over the entire current assets and subsidy (excluding reimbursement related to energy savings and interest expenses) of the Company. Repayment of sanctioned term loan would fall due for repayment in 20 quarterly installments of Rs. 192.50 crore starting from June 2013 and ending in March 2018. The rate of interest on the term loan is linked to the SBI base rate and during the period interest rate was between 10.80% to 11.50% p.a. The total borrowings is Rs.1540.00 crore out of which Rs.770.00 crore being payable in next year is disclosed in Note 11 ''Other Current Liabilities''.
$ Foreign Currency External Commercial Borrowing (ECB) loan from Bank, has been used for energy saving and urea capacity augmentation projects at Vijaipur and is secured by first ranking pari-passu charge on all movable and immovable fixed assets (both present and future) related to Vijaipur unit and second ranking pari-passu charge on the current assets (both present and future) and subsidy of the Vijaipur Unit.
ECB has been refinanced through DBS Bank, Singapore on 06.01.2016. The ECB was earlier drawn from SBI, NY at rate of interest of 6 months USD LIBOR plus margin of 3.05% p.a. and upfront arrangement fee of 1.58% of facility.
The rate of interest of refinanced ECB from DBS, Singapore is 6 months USD LIBOR plus margin of 1.49% p.a. Repayment of refinanced ECB loan will commence from FY 2016-17. Foreign Currency External Commercial Borrowing (ECB) loan from DBS Bank is secured by first ranking pari-passu charge on all movable and immovable fixed assets (both present and future) related to Vijaipur unit and second ranking pari-passu charge on the current assets (both present and future) and subsidy of the Vijaipur Unit. The security creation in respect of loan refinanced and drawn from DBS Bank is under process.
The repayment of ECB loan will fall due for Rs.32.14 crore in FY 2016-17, Rs.39.55 crore in FY 2017-18, Rs.56.85 crore in FY 2018-19, Rs.59.33 crore in FY 2019-20 and Rs.59.33 crore in FY 2020-21. A sum of Rs.247.20 crore (Rs.215.06 crore Rs.32.14 crore) is outstanding as on 31.03.2016 out of which the installments due for payment in FY 2016-17 amounting to of Rs.32.14 crore is disclosed in Note 11 ''Other Current Liabilities''.
# Deferred Tax Assets amounting to Rs.34.23 crore (net) have been recognized as on 31stMar, 2016 in respect of unabsorbed depreciation for setoff against taxable income in future based on Notification No. 12012/3/2010-FPP(II) dated 3rd April, 2014 of Modified New Pricing policy of urea by Government of India and New Urea Policy-2015 for existing gas based urea manufacturing units based on notification No. 12012/1/2015-FPP dated 25th May 2015 thereby having convincing evidence of certainty of utilization of deferred tax assets.
Urvarak Videsh Limited, a joint venture with Krishak Bharti Co-operative Limited and Rashtriya Chemicals & Fertilizers Limited has been setup for fertilizer business and rendering consultancy services in this regard. During the year Urvarak Videsh Limited has been declared Dormant Company.
Ramagundam Fertilizers & Chemicals Limited, a joint venture with Engineers India Limited and Fertilizer Corporation of India has been incorporated on 17.02.2015 for revival of closed Fertilizer Unit of FCIL at Ramagundam, Telengana.
* Being less than Rs.50,000/-, figures not given.
$ Out of Rs.24.44 crore invested in RFCL, Share application of Rs.9.00 crore are pending for allotment and is disclosed in Note 18: Other Current Assets.
# Capital Grant recoverable from Government of India of Rs.835.94 crore represents the grant to be disbursed by Government of India for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/FOâ to ''Gasâ for the FY 2017-18. Capital Grant recoverable from GOI amounting to ''Rs.1080.04 crore for the FY 2015-16 & FY 2016-17 is disclosed in Note 23: Other current assets. Details of Capital Grant for AFCP are disclosed in Note :4 Deferred Government Grant.
$ Capital grant includes cumulative foreign exchange losses of Rs.7.39 crore (net) in respect of outstanding liability of AFCP recoverable from GOI as part of project cost and such exchange losses shall be adjusted in the capital cost upon final settlement of liabilities.
# Includes an advance of Rs.130.69 crore (Previous year Rs.130.69 crore) given to a foreign supplier M/s. Karsan during the year 1995-96 against import of Urea, the supplies of which were not received and subsequently the contract was terminated. Pending litigation, the net advance of Rs.129.64 crore (after recovery of Rs.1.05 crore) has been fully provided for in the earlier years from the revenue reserve and surplus.
* As per direction of Court an amount of Rs.1.32 crore (Previous Year Rs.1.32 crore) is being kept as case property.
$ Includes amount recoverable on account of Gas Pooling amounting to Rs.147.94 crore (Previous year Nil).
* Capital Grant recoverable from Government of India represents the grant to be disbursed by Government of India for Ammonia feed stock conversion project from ''LSHS/FOâ to ''Gasâ as disclosed in Note 4.
** Assets held for sale includes Rs.13.55 crore (Previous Year Rs.13.55 crore) being the written down value of the assets discarded upon commissioning of changeover of feed stock from LSHS/FO to Gas projects as stated in Note 4.
$ Capital Grant recoverable from Government of India of Rs.1080.04 crore represents the grant to be disbursed by Government of India for Ammonia Feed Stock Conversion Project (AFCP) from ''LSHS/FOâ to ''Gasâ for the FY 2015-16 & FY 2016-17. Capital Grant recoverable from GOI amounting to Rs.835.94 crore for the FY 2017-18 is disclosed in Note 18: Other noncurrent assets.
1. Provident Fund:
The Provident Fund contributions are made to a Trust administered by the Company. The interest rate payable to the members of the Trust shall not be lower than statutory rate of interest declared by the Central Government under the Employees Provident Funds and Miscellaneous Provisions Act, 1952.
During the year an amount of Rs.26.56 crore (P.Y. Rs.27.54 crore) has been charged to statement of Profit and loss towards contribution by the Company.
In terms of the guidance on implementing the revised AS-15 issued by the Accounting Standard Board of the Institute of Chartered Accountants of India, the Provident Fund Trust set up by the Company, is treated as Defined Benefit Plan since the Company has to meet the shortfall in the fund assets, if any. Further, having regard to the assets of the Fund and the Return on the Investments, the Company does not expect any deficiency in the foreseeable future. In terms of the guidance note issued by the Institute of Actuaries of India, the actuary has provided a valuation of provident fund liability and determined that there is no shortfall as at 31st March, 2016.The funds of the trust have been invested under various securities as prescribed by regulatory authorities. "
Foot Note:
1. The company has funded the gratuity liability through a separate Gratuity Fund. The fair value of the plan assets is mainly based on the information given by the insurance companies through whom the investment has been made by the fund. Gratuity liability of Rs.49.38 crore (Previous year Rs.33.70 crore) is unfunded as on 31st March, 2016. Other defined benefit obligations are unfounded.
2. Other Employee Benefit Schemes:
Provision of Rs.(0.76) crore (Previous year Rs.1.87 crore) towards Employeesâ Family Economic Rehabilitation Scheme and Social Security Benefits scheme has been made on the basis of actuarial valuation and charged to the Statement of Profit and Loss account. A net liability of Rs.15.06 crore (Previous year Rs.15.82 crore) has been recognized in the Balance Sheet as at 31st March 2016 on account of these schemes.
NOTE 3.: SEGMENT REPORTING Business Segments:
Companyâs primary business segments are ''Ureaâ & ''Other Productsâ(including Industrial Products, Bio Fertilizers and Traded Products) and are reportable segments under Accounting Standard-17 on ''Segment Reportingâ issued by the Institute of Chartered Accountants of India.
4. Geographical Segment:
The operations of the company are conducted within India and there is no separate reportable geographical segment
C) Transactions with Related parties:
(i) During the year there were transactions of ''25.38 crore (previous year Rs.2.44 crore) with Ramagundam Fertilizers & Chemicals Limited towards subscription of Share capital of Rs.22.00 crore (Previous Year Rs.2.44 crore) and others Rs.3.38 crore (Previous Year Nil).
(ii) Remuneration to Key Management Personnel at B) above is Rs.1.39 crore (Previous period Rs.1.42 crore). In addition to the above they are eligible for non monetary perquisites as per Government of India guidelines.
NOTE 5: AS-28: IMPAIRMENT OF ASSETS
In accordance with Accounting Standard (AS)-28, the carrying amount of fixed assets have been reviewed at year-end for indication of impairment loss, if any, by considering assets of entire one plant as Cash Generating Unit. As there is no indication of impairment, no loss has been recognized during the year.
NOTE 6: ASSETS TAKEN ON OPERATING LEASE:
The Companyâs significant leasing arrangements are in respect of operating leases of premises for offices, godowns and residential use of employees & vehicles. These leasing arrangements are usually renewable on mutually agreed terms but are not non-cancellable. Employee benefit expense remuneration and benefits include Rs. 0.49 crore (Previous year Rs.0.13 crore) towards lease payments, net of recoveries, in respect of premises for residential use of employees. Lease payments in respect of premises for offices, godowns and vehicles, Rs.3.52 crore (Previous year Rs.3.52 crore) are shown in Rent (other expenses Note: 34).
NOTE 7 As per requirements of the listing agreements with the stock exchanges, the requisite details of loans and advances in the nature of loans given by the Company are as under:
(i) There are no loans and advances in the nature of loans to any subsidiary.
(ii) No loans have been given (other than loans to employees), wherein there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to firms/companies in which Directors are interested.
NOTE 8 REMITTANCE IN FOREIGN CURRENCIES FOR DIVIDENDS
The Company has not remitted any amount in foreign currencies on account of dividend during the year and does not have information as to the extent to which remittances, if any, in foreign currencies on account of dividends have been made by/on behalf of non-resident shareholders.
Note 9 In view of average loss of Rs.115.69 crore during preceding three financial years, there is no requirement to spend towards CSR during the year as per Companies Act, 2013. The Company had opening CSR Reserve of Rs.5.26 crore in respect of unspent CSR budget as per DPE guidelines. The company has incurred an amount of Rs.1.25 crore during the year (Previous Year Rs.0.37 crore) towards Corporate Social Responsibility activities leaving balance CSR fund of Rs.4.01 crore as on 31.03.2016.
Note 10 (a) Balance of subsidy recoverable of Rs.4629.17 crore (previous year Rs.4975.41) crore and Capital Grant recoverable of Rs.2030.58 crore (previous year Rs.3374.59 crore) is subject to confirmation by Government of India. In addition some of the Balances of trade/other payable and loans and advances are subject to confirmation/reconciliation. Adjustment if any will be accounted for on confirmation/reconciliation of the same which in the opinion of the management will not have a material impact.
(b) In the opinion of the management, the value of assets, other than fixed assets and non-current investments, on realization in the ordinary course of business, will not be less than the value at which these are stated in the balance sheet.
Note 11 Figures of previous period have been re-arranged / regrouped / re-cast, wherever necessary.
1Shri Vikram Srivastava ceased to be member of the Board and committee on 05.05.2016 on completion of his tenure. Committee met on 24.04.2015, 09.09.2015 and 12.01.2016
Mar 31, 2013
Rs. Crore
As at As at
31st March
2013 31st March
2012
1. CONTINGENT LIABILITIES
Claims against the Company not
acknowledged as debts
a. Pending Appellate/Judicial decisions:
Income tax 277.57 269.00
Purchase tax 1.30 59.23
Excise, customs and service tax 6.56 6.04
VAT 0.30 0.14
Land compensation/development claims 3.90 3.86
Arbitration and civil cases 45.61 37.77
b. Other claims 0.62 1.20
c. Claims in respect of legal cases
filed against the company for
labour and other matters, amount
whereof is not ascertainable 335.86 377.24
2 Exceptional item represents Purchase Tax Liability of Rs.57.41 crore
(excluding interest liability) for the past period 1st September, 2001
to 31st March, 2006, hitherto considered as contingent liability has
been provided. The Review petition in the matter filed on 30th August,
2012 in the Hon''ble Supreme Court of India has been dismissed on 1st
November, 2012. Based on the opinion, no interest liability is
envisaged upto the period final assessment order is passed.
3.1.1 In terms of notification No. G.S.R 914(E) dated 29th December,
2011 relating to AS 11 issued by Ministry of Corporate affairs and
consequent upon exercising of option by the company during financial
year 2011-12 to treat long term foreign currency loan as long term
foreign currency monetary items as per Clause 46A (i) of AS- 11, an
amount of Rs.7.92 crore has been included in the addition to Fixed
Assets/Capital Work in Progress as on 31st March, 2013.
3.1.2 Other Employee Benefit Schemes:
Provision of Rs.2.15 crore (Previous year Rs.1.44 crore) towards Employees''
Family Economic Rehabilitation Scheme and Social Security Benefits
scheme has been made on the basis of actuarial valuation and charged to
the Profit & Loss account. A net liability of Rs.14.03 crore has been
recognized in the Balance Sheet as at 31st March 2013 on account of
these schemes.
3.1.3 Provident Fund: 12% of Basic Pay plus Dearness allowance
contributed to the Provident Trust of the Company. The Company does not
anticipate any further obligation in the near foreseeable future having
regard to the amount of the fund and return on investment as confirmed
by the actuary.
3.1.4 During the year, Company has set up a separate Pension Trust for
operation of Employees Defined Contribution Pension Scheme through Life
Insurance Corporation of India and provided Rs.8.09 crore towards
Company''s liability under the said policy under the heading
contribution to provident and other funds in note 27.
3.2 AS-17: Segment Reporting
3.2.1 Business Segments:
Company''s primary business segments are Rs.Urea'' & Rs.Other Products''
(which include Industrial Products and Bio Fertilizers, traded goods
which have got similar risk and return profiles) and are reportable
segments under Accounting Standard-17 on Rs.Segment Reporting'' issued by
the Institute of Chartered Accountants of India.
3.2.2 Geographical Segment:
The operations of the company are conducted within India and there is
no separate reportable geographical segment
3.3 AS-19: LEASES
The Company''s significant leasing arrangements are in respect of
operating leases of premises for offices, godowns, residential use of
employees and vehicles. These leasing arrangements are usually
renewable on mutually agreed terms but are not non-cancellable. Note:
27 Employee benefit expense remuneration and benefits include Rs.0.13
crore (Previous year Rs.0.19 crore) towards lease payments, net of
recoveries, in respect of premises for residential use of employees.
Lease payments in respect of premises for offices, godowns and
vehicles, Rs.3.08 crore (Previous year Rs.3.32 crore) are shown in Note:
31-Other expenses.
3.4 AS-28: Impairment of assets
In accordance with Accounting Standard (AS)-28, the carrying amount of
fixed assets have been reviewed at year-end for indication of
impairment loss, if any, by considering assets of entire one plant as
Cash Generating Unit. As there is no indication of impairment, no loss
has been recognized during the year.
4 "For FY 2012-13, Company has approved budget amount of Rs.3.15 crore
towards Corporate Social Responsibility (CSR) activities, During FY
2010-11 and 2011-12, Company earmarked Rs.3.00 crore and Rs.3.25
respectively crore for CSR activities against which an expenditure of
Rs.1.60 crore have been incurred till 31.03.2012. Company has incurred
total CSR expenditure of Rs.1.47 crore during the FY 2012-2013. The
budget for unspent amount of Rs.6.33 crore does not lapse and the same
has been carried forward to FY 2013-14 on account of CSR activities."
5 As per requirements of the listing agreements with the stock
exchanges, the requisite details of loans and advances in the nature of
loans given by the Company are as under:
(i) There are no loans and advances in the nature of loans to any
subsidiary.
(ii) No loans have been given (other than loans to employees), wherein
there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to
firms/companies in which Directors are interested.
6 REMITTANCE IN FOREIGN CURRENCIES FOR DIVIDENDS
The Company has not remitted any amount in foreign currencies on
account of dividend during the year and does not have information as to
the extent to which remittances, if any, in foreign currencies on
account of dividends have been made by/on behalf of non-resident
shareholders. The particulars of dividend for the year 2011-12 paid in
current year on account of non- resident shareholders in Indian rupees
are as under:
7 Debit/Credit balances of some of the parties are in the process of
confirmation/ reconciliation.
8 Figures of previous year/period have been re-arranged / regrouped /
re-cast, wherever necessary.
Mar 31, 2012
A. There has been no movement in the Issued, Subscribed and Paid -up
capital of the Company.
b. Terms/Rights attached to equity shares
The Company has only one class of equity share having a par value of
Rs.10 per share. Each holder of equity shares is entitled to one vote per
share and entitled to dividends approved by shareholders.
In the event of liquidation of the company, the holders of equity share
will be entitled to receive remaining assets of the company, after
distribution to creditors and all preferential amounts. The
distribution will be in proportion to the number of equity shares held
by each shareholder
a. 9.42% Secured Redeemable Non-Convertible Bonds of Rs.10,00,000/- each
issued with five years tenor redeemable at par in three installments at
the end of third year from issue date of 15th September, 2011 (30% at
end of 3rd year, 30% at the end of 4th year and balance 40% at end of
5th year). These bonds are secured by mortgage/charge on land and
building of Company located at Corporate office at Noida.
b. Rupee loan from scheduled banks, with total sanctioned amount of
Rs.3850 crore for Ammonia Feedstock Conversion Projects is secured by
first charge ranking pari-passu inter-se on entire fixed assets,
movable and immovable (present & future) related to Nangal, Bathinda &
Panipat units and second charge over the entire current assets and
subsidy (excluding reimbursement related to energy savings and interest
expenses) of the Company. Repayment of sanctioned term loan would fall
due for Rs.770 crore in FY 2013-14, Rs.770 crore in FY 2014-15, Rs.770 crore
in FY 2015-16, Rs.770 crore in FY 2016-17 and Rs.770 crore in FY 2017-18.
The rate of interest on the term loan is linked to the SBI base rate
and during the year varied between 9.75%-11.50% p.a.
c. Foreign currency External Commercial Borrowing (ECB) loan from
Schedule Banks, with total sanctioned limit of USD 50 million has been
used for energy saving and urea capacity augmentation projects at
Vijaipur and is secured by first pari-passu charge on all fixed assets,
movable and immovable (both present and future) related to Vijaipur and
second pari-passu charge on the current assets (both present and
future) and subsidy of the company. The rate of interest is 6 months
USD LIBOR plus margin of 3.05% p.a. and upfront arrangement fee of
1.58% of facility. Repayment of ECB loan would fall due for Rs.6.12 crore
in FY 2014-15, Rs.14.09 crore in FY 2015- 16, Rs.14.10 crore in FY 2016-17,
Rs.09 crore in FY 2017-18, Rs.14.10 crore in FY 2018-19 and Rs.14.95 crore
in FY 2019-20.
d. Foreign currency loans - Buyers Credit from scheduled Banks, total
drawn amount of USD 15.68 million for energy saving and urea capacity
augmentation projects at Vijaipur. The rate of interest is 6 months
LIBOR plus margin of 2.00% p.a. for Buyer Credit of USD 9.89 million
and 6 months USD LIBOR plus margin of 1.50%p.a. and upfront fee of 1.1%
p.a. for Buyer's credit of USD 5.79 million. Repayment of Buyer's
credit would fall due for Rs.47.05 crore in FY 2013-14, Rs.31.45 crore in
FY 2014-15 and Rs.2.46 crore in FY 2015-16.
a. Title/Lease Deed for land acquired at Nangal (Rs.0.93 crore),
Vijaipur (Rs.4.36 crore), Bathinda (Rs.0.15 crore), Building at Scope
Complex, New Delhi (Rs.2.07 crore) and Land/Building at Bhopal (Rs.0.38
crore) are pending execution.
b. 325.70 acres of land at Nangal (Rs. 0.01 crore) had been symbolically
possessed by the Punjab Government on 29.10.1998 without determination
of consideration. Though the ownership of the entire land including
325.70 acres vests with the Company, however, the physical possession
of 325.70 acres of land is with its erstwhile owners.
c. Consequent upon the implementation of Feed Stock changeover
Projects and its expected completion during 2012-2013, depreciation on
plant & machinery expected to be replaced has been charged over the
reduced residual life and accordingly during the year, in respect of
plant & machinery, depreciation provided is higher by Rs.0.82 crore
(previous year Rs.0.84 crore) in the accounts.
a. Capital work-in-progress includes amount ofRs.2161.52 crore incurred
upto 31st March, 2012 relating to feedstock conversion projects from
fuel oil to natural gas at Panipat, Nangal and Bathinda units. In terms
of Government policy notified on 6th March, 2009, the Company is
entitled to capital subsidy after successful commissioning of the
projects over a period of 5 years, which shall be appropriately
accounted for in terms of the policy.
b. * Addition to capital work in progress under the head Expenditure
during construction period includes Rs.3.37 crore (previous year Rs.Nil) on
account of foreign exchange fluctuation on longterm loan relating to
acquisition of Fixed Assets pursuant to the Company exercising the
option under Clause 46 A (i) of AS-11 to treat Foreign Currency Loans
as Long Term Foreign Currency monetary items under the Notification
number (G.S.R. 914(E) dated 29th December, 2011) issued by the Ministry
of Corporate affairs relating to Accounting Standard 11.
* Includes amount due from Directors - Rs. 23000/- (Previous year Rs. NIL)
# Includes an advance of Rs.130.69 crore (US$ 37.62 million) given to a
foreign supplier M/s. Karsan during the year 1995-96 against import of
Urea, the supplies of which were not received and subsequently the
contract was terminated. Pending litigation, the amount has been fully
provided for in the earlier years from the revenue reserve and surplus.
The outstanding advance (net of recovery) of Rs.129.64 crore is shown in
the Accounts under "Loans and Advances Recoverable" with
corresponding adjustment in revenue reserve. Adjustment, if any, shall
be made on settlement of the litigation.
Rs. Crore
As at As at
31st March
2012 31st March
2011
1. CONTINGENT LIABILITIES
Claims against the Company not
acknowledged as debts a Pending
Appellate/Judicial decisions:
Income tax 269.00 201.31
Purchase tax 59.23 59.23
Excise, customs and service tax 6.04 7.37
VAT 0.14 -
Land compensation / development claims 3.86 13.69
Arbitration and civil cases 37.77 29.23
b. Other claims 1.20 1.18
c. Claims in respect of legal cases filed
against the company for labour and other
matters, amount whereof is not
ascertainable
377.24 312.01
Note:
1. The company has funded the gratuity liability through a separate
Gratuity Fund. The fair value of the plan assets is mainly based on the
information given by the insurance companies through whom the
investment have been made by the fund. Gratuity liability of Rs. 7.72
crore is unfunded as on 31st March, 2012.
2. The defined benefit obligations, other than gratuity are unfunded.
3.1.1 Other Employee Benefit Schemes:
Provision of Rs.1.44 crore (Previous year Rs.3.07 crore) towards
Employees' Family Economic Rehabilitation Scheme and Social Security
Benefits scheme has been made on the basis of actuarial valuation and
charged to the Statement of Profit & Loss. A net liability of Rs.13.09
crore has been recognized in the Balance Sheet as at 31st March 2012 on
account of these schemes.
3.1.2 Provident Fund: 12% of Basic Pay plus Dearness allowance
contributed to the Provident Trust of the Company. The Company does not
anticipate any further obligation in the near foreseeable future having
regard to the amount of the fund and return on investment as confirmed
by the actuary.
3.2 AS-17: SEGMENT REPORTING
3.2.1 Business Segments:
Company's primary business segments are 'area' & 'Other Products'
(which include Industrial Products and Bio Fertilizers, traded goods
which have got similar risk and return profiles) and are reportable
segments under Accounting Standard-17 on 'Segment Reporting' issued
by the Institute of Chartered Accountants of India.
3.2.2 Geographical Segment:
The operations of the company are conducted within India and there is
no separate reportable geographical segment
C) Transactions with Related parties:
(I) There is no transaction with related party at A) above except
investment of Rs. Nil crore towards its paid-up capital during the year
(previous year Rs.0.03 crore). Against total investment of Rs.0.18 crore as
on 31st March, 2012, provision of Rs. 0.15 crore has been made in the
Accounts on account of diminution in value of investments).
(ii) Remuneration to Key Management Personnel at B) above is Rs.0.86
crore (Previous year Rs.0.77 crore) which does not include remuneration
to Key Management Personnel at (i) and (ii) above who have been given
additional charge of the Company by GOI.
3.3 AS-19: LEASES
3.3.1 Assets taken on Operating lease:
The Company's significant leasing arrangements are in respect of
operating leases of premises for offices, godowns, residential use of
employees and vehicles. These leasing arrangements are usually
renewable on mutually agreed terms but are not non-cancellable. Note:
26 Employee benefit expense remuneration and benefits include Rs.0.19
crore (Previous year Rs.0.26 crore) towards lease payments, net of
recoveries, in respect of premises for residential use of employees.
Lease payments in respect of premises for offices, godowns and
vehicles, Rs.3.32 crore (Previous year Rs.3.62 crore) are shown in Note:
31-Other expenses.
3.4 AS-27: FINANCIAL REPORTING OF INTERESTS IN JOINT VENTURES
3.4.1 The disclosure of Company's interest in Joint Venture entity in
terms of Accounting Standard-27 issued by the Institute of Chartered
Accountants of India is as under:
(i) Name of the Joint Venture entity: 'UrvarakVidesh Limited'
(ii) Co-Joint Venture companies: Krishak Bharti Co-operative Ltd. and
Rashtriya Chemicals & Fertilizers Ltd. as equal partners.
(iii) Company has an investment of Rs.0.18 crore towards paid up equity
capital representing one third share.
(iv) The Company's share of ownership interest assets, liabilities,
income, expenses, contingent liabilities and capital commitment in the
Joint Venture Company, incorporated in India, are given below:
3.5 AS-28: IMPAIRMENT OF ASSETS
In accordance with Accounting Standard (AS)-28, the carrying amount of
fixed assets have been reviewed at year-end for indication of
impairment loss, if any, by considering assets of entire one plant as
Cash Generating Unit. As there is no indication of impairment, no loss
has been recognized during the year.
3.6 In terms of notification No. G.S.R 914(E) dated 29th December, 2011
relating to AS 11 issued by Ministry of Corporate affairs and
consequent upon exercising of option by the company to treat long term
foreign currency loan as long term foreign currency monetary items as
per Clause 46A (i) of AS-11, an amount of Rs.3.37 crore has been included
in the CWIP and profit are higher by Rs.3.37 crore due to change in
accounting policy.
4 REMITTANCE IN FOREIGN CURRENCIES FOR DIVIDENDS
The Company has not remitted any amount in foreign currencies on
account of dividend during the year and does not have information as to
the extent to which remittances, if any, in foreign currencies on
account of dividends have been made by/on behalf of non-resident
shareholders. The particulars of dividend for the year 2010-11 paid in
current year on account of non-resident shareholders in Indian rupees
are as under:
Note:
The Chairman & Managing Director and Functional Directors are allowed
the use of company's car for private purposes upto 1000 km per month
and recoveries wherever required are made as per Government guidelines.
5 AS PER REQUIREMENTS OFTHE LISTING AGREEMENTS WITH THE STOCK
EXCHANGES,THE REQUISITE DETAILS OF LOANS AND ADVANCES IN THE NATURE OF
LOANS GIVEN BYTHE COMPANY ARE AS UNDER:
(I) There are no loans and advances in the nature of loans to any
subsidiary.
(ii) No loans have been given (other than loans to employees), wherein
there is no repayment schedule or repayment is beyond seven years; and
(iii) There are no loans and advances in the nature of loans to
firms/companies in which Directors are interested.
6 Debit/Credit balances of some of the parties are in the process of
confirmation/ reconciliation.
7 Figures of previous year have been re-arranged / regrouped /
re-cast, wherever necessary and to comply with the requirement of
revised Schedule VI of the Companies Act.
Mar 31, 2011
1. CONTINGENT LIABILITIES
(Rs. in crore)
Particulars As at As at
31st March,2011 31st March, 2010
i) Claims against the Company not
acknowledged as debts
(a) Pending Appellate/Judicial
decisions:
- Income Tax 201.31 123.33
- Purchase Tax 59.23 59.23
- Excise& Customs Duty 7.37 2.29
- Land Compensation/Development claims 13.69 13.33
- Arbitration and civil cases 29.23 25.05
(b) Other claims 1.18 1.17
(c) Claims in respect of legal cases
filed against the company for labour and
other matters, extent whereof is not
ascertainable.
TOTAL 312.01 224.40
ii) Estimated amount of contracts remaining
to be executed 3165.86 3515.56
on capital accounts and not provided for
(net of advances).The amount as at 31 *
March 2011 includes Project contracts
relating to changeover of feedstock from
Fuel oil to natural gas at Nangal, Panipat
and Bathinda unit (Rs.2949.41 crore)
and energy saving & capacity enhancement
at Vijaipur I & II (Rs.192.17 crore).
iii) Unutilized amount of Letter of
Credit. 179.03 8.33
2.Capital work-in-progress includes amount of Rs.485.68 crore
incurred upto 31st March, 2011 relating to feedstock | conversion
projects from fuel oil to natural gas at Panipat, Nangal and Bathinda
units. In terms of Government J policy notified on 6th March, 2009, the
Company is entitled to capital subsidy after successful commissioning
of the projects over a period of 5 years, which shall be appropriately
accounted for in terms of the policy.
3. An advance of Rs.130.69 crore (US$ 37.62 million) was given to a
foreign supplier M/s. Karsan during the year 1995-96 against import of
Urea, the supplies of which were not received and subsequently the
contract was terminated. Pending litigation, revenue reserves have been
reduced to the extent of this advance during the year 1996-97. The
outstanding advance (net of recovery) of Rs.129.64 crore is shown in the
Accounts under "Loans and Advances Recoverable" with corresponding
adjustment in revenue reserve. Adjustment, if any, shall be made on
settlement of the litigation.
Further, fixed deposit of Rs.1.32 crore (US$ 380,000) is maintained with
a scheduled bank, as case property, in terms of the order dated
16.11.2000 of the Hon'ble Delhi High Court and shown in Schedule 1.11
Loans and Advances. As the matter is subjudice the exchange variation
and interest accrued thereon is not being accounted for in the books.
4. Based on the information received by the Company from the
suppliers, regarding their coverage under the Micro, Small and Medium
Enterprises Development Act, 2006, the disclosure as required under the
said Act is as under:
5. Subsidy on Urea from Government of India includes Rs.23.28 crore net
debit (Previous yearRs.42.05 crore net credit) for the earlieryears as
notified during the year.
6. Debit/Credit balances of some of the parties are in the process of
confirmation/ reconciliation.
7.1.0 Other Employee Benefit Schemes:
Provision of Rs.3.07 crore (Previous year Rs.1.33 crore) towards Employees'
Family Economic Rehabilitation Scheme and Social Security Benefits
scheme has been made on the basis of actuarial valuation and charged to
the Profit & Loss account. A net liability of Rs.11.65 crore has been
recognized in the Balance Sheet as at 31 * March 2011 on account of
these schemes.
7.1.1 Provident Fund: 12% of Basic Pay plus Dearness allowance
contributed to the Provident Trust of the Company. The Company does not
anticipate any further obligation in the near foreseeable future having
regard to the amount of the fund and return on investment as confirmed
by the actuary.
7.2.1 Business Segments:
Company's primary business segments are 'Urea' & 'Other Products'
(which include Industrial Products and Bio Fertilizers, traded goods
which have got similar risk and return profiles) and are reportable
segments under Accounting Standard-17 on 'Segment Reporting' issued by
the Institute of Chartered Accountants of India.
7.2.2 Geographical Segment:
The operations of the company are conducted within India and there is
no separate reportable geographical segment.
7.2.3 The disclosure of segment-wise information is given at
Annexure-I.
C) Transactions with Related parties:
i) There is no transaction with related party at A) above except
investment of Rs.0.03 crore towards its paid-up capital during the year
(in respect of total investment of Rs.0.18 crore as on 31 * March, 2011
full provision has been made in the Accounts).
ii) Remuneration to Key Management Personnel at B) above is Rs.0.77 crore
(Previous year Rs.0.82 crore) which does not include remuneration to Key
Management Personnel at (i) and (ii) above who have been given
additional charge of the Company by Gol.
7.4 AS-19: Leases- Assets taken on Operating lease:
The Company's significant leasing arrangements are in respect of
operating leases of premises for offices, godowns, residential use of
employees and vehicles. These leasing arrangements are usually
renewable on mutually agreed terms but are not non-cancellable.
Schedule 2.5 - Employees remuneration and benefits include Rs.0.26 crore
(Previous year Rs.0.61 crore) towards lease payments, net of recoveries,
in respect of premises for residential use of employees. Lease payments
in respect of premises for offices, godowns and vehicles, Rs.3.62 crore
(Previous yearRs.3.88 crore) are shown in Schedule 2.8 - Other expenses.
8.5.2 Provision for taxation has been made keeping in view the
provisions of the law and various judicial pronouncements.
8.6 AS-27: Financial Reporting of Interests in Joint Ventures-
8.6.1 The disclosure of Company's interest in Joint Venture entity in
terms of Accounting Standard-27 issued by the Institute of Chartered
Accountants of India is as under: -
i) Name of the Joint Venture entity: 'UrvarakVidesh Limited'
ii) Co-Joint Venture companies: Krishak Bharti Co-operative Ltd. and
Rashtriya Chemicals Ltd. as equal I partners.
Hi) Company has an investment of Rs.0.18 crore towards paid up equity
capital representing one third share.
8.7 AS-28: Impairment of Assets-
In accordance with Accounting Standard (AS)-28, the carrying amount of
fixed assets have been reviewed at year-end for indication of
impairment loss, if any, by considering assets of entire one plant as
Cash Generating Unit. As there is no indication of impairment, no loss
has been recognized during the year.
9 As per requirements of the listing agreements with the stock
exchanges, the requisite details of loans and
advances in the nature of loans given by the Company are as under:
i) There are no loans and advances in the nature of loans to any
subsidiary.
ii) No loans have been given (other than loans to employees), wherein
there is no repayment schedule or repayment is beyond seven years; and
iii) There are no loans and advances in the nature of loans to
firms/companies in which Directors are interested.
9 Figures in brackets pertain to previous year and have been
re-arranged / regrouped / re-cast, wherever necessary.
Mar 31, 2010
1. CONTINGENT LIABILITIES (Rupees in Crore)
As at As at
Particulars 31stMarch 2010 31st March 2009
i) Claims against the Company not
acknowledged as debts
(a) Pending Appellate/Judicial
decisions:
- Income Tax 123.33 126.76
- Purchase Tax 59.23 59.23
- Excise & Customs Duty 2.29 2.29
- Sales Tax - 0.04
Land Compensation/Development claims 13.33 13.55
Arbitration and civil cases 25.05 20.85
(b) Other claims 1.17 1.22
(c) Claims in respect of legal cases
filed against the company for labour
and other matters, extent
whereof is not ascertainable. _ -
TOTAL 224.40 223.94
ii) Estimated amount of contracts
remaining to be executed on 3515.56 31.05
capital accounts and not provided for (net of advances).
The amount as at 31st March, 2010 includes Project contracts
relating to changeover of feedstock from FO/LSHS to natural
gas at Nangal, Panipat and Bathinda unit (Rs.3381.11 crore)
and energy saving & capacity enhancement at Vijaipur I & II
(Rs.118.21 crore).
iii) Unutilized amount of Letter
of Credit. 8.33 6.18
2. INVESTMENTS. CURRENT ASSETS, LOANS & ADVANCES. CURRENT LIABILITIES
AND PROVISIONS
2.1 Capital work-in-progress includes amount of Rs.0.63 crore incurred
during the year relating to feedstock conversion projects from FO/LSHS
to natural gas at Panipat, Nangal and Bathinda units. In terms of
Government policy notified on 6lh March,2009 the Company is entitled to
capital subsidy after successful commissioning of the projects over a
period of 5 years, which shall be appropriately accounted for in terms
of the policy.
2.2 An advance of Rs. 130.69 crore (US$ 37.62 million) was given to a
foreign supplier M/s. Karsan in the year 1995- 96 against import of
Urea, the supplies of which were not received and subsequently the
contract was terminated. Pending litigation, revenue reserves have been
reduced to the extent of this advance during the year 1996-97. The
outstanding advance (net of recovery) of Rs. 129.64 crore is shown in
the Accounts under "Loans and Advances Recoverable" with corresponding
adjustment in revenue reserve. Adjustment, if any, shall be made on
settlement of the litigation.
Further, fixed deposit of Rs.1.32 crore (US$ 380,000) is maintained
with a scheduled bank, as case property, in terms of the order dated
16.11.2000 of the Honble Delhi High Court and shown in Schedule 1.11
Loans and Advances. As the matter is subjudice the exchange variation
and interest accrued thereon is not being accounted for in the books.
2.3 Based on the information received by the Company from the
suppliers, regarding their coverage under the Micro, Small and Medium
Enterprises Development Act, 2006, the disclosure as required under the
said Act is asunder:
3. PROFIT & LOSS ACCOUNT
3.1 Subsidy on Urea from Government of India includes Concession Price
Subsidy for the earlier years of Rs.42.05 crore (Previous year Rs.
89.00 crore) as notified during the year.
3.2 In accordance with Accounting Standard (AS)-28 on "Impairment of
Assets", the carrying amount of fixed assets have been reviewed at
year-end for indication of impairment loss, if any, by considering
assets of entire one plant as Cash Generating Unit. As there is no
indication of impairment, no loss has been recognized during the year.
4. GENERAL
4.1 Employee Benefits : Disclosures as required by Accounting Standard
(AS)-15 (Revised 2005) issued by the Institute of Chartered Accountants
of India are as under:-
4.1.1 General description of defined benefit schemes:
Gratuity
Payable on separation @ 15 days pay for each completed year of service
subject to maximum of Rs 10 lakh to eligible employees who render
continuous service of 5 years or more.
Leave Encashment (Earned and Half Pay Leave)
Payable on separation to eligible employees who have accumulated earned
leave and half pay leave. During the service period encashment of
accumulated earned leave is allowed in a financial year leaving minimum
balance leave of 30 days.
Post Retirement Medical Benefits (PRMB)
Mediclaim Insurance Policy available to the retiring employee and the
spouse (for a cover of Rs.2 lakhs per annum) after rendering 15 years
of continuous service.
Post Retirement Settlement Benefits (PRSB)
Travelling and Baggage expenses payable to retiring employees for
settlement at their hometown.
Long Service Award (LSA)
Payable to employees on completion of specified years of service.
Social Security Benefits (SSB)
Available to employees who die while in service or suffer
permanent/total disablement subject to a limit of 60 months salary or
Rs.1 lakhs whichever is higher.
5.1.2 Other disclosures/reconciliation, in respect of defined benefit
obligations are as under: - i) Reconciliation of present value of
defined benefit obligations and plan assets:
5.1.3 Provident Fund: 12% of Basic Pay plus Dearness allowance
contributed to the Provident Trust of the Company. The Company does not
anticipate any further obligation in the near foreseeable future having
regard to the amount of the fund and return on investment as confirmed
by the actuary.
5.1.4 During the year, Rs.14.02 crore has been provided towards defined
contribution Pension Scheme for employees for the period 1S| January,
2007 to 31 s,March, 2010.
5.1.5 The disclosure above is in respect of the current year and two
preceding years. The disclosure in respect of two immediate preceding
annual periods as required by AS-15 (Revised 2005) is not presented
as the management considered it impracticable in the absence of
requisite information.
5.2.2. Provision for taxation has been made keeping in view the
provisions of the law and various judicial pronouncements.
5.3 Segment Reporting
Business Segments:
Companys primary business segments are Urea & Other Products
(which include Industrial Products and Bio Fertilizers, traded goods
which have got similar risk and return profiles) and are reportable
segments under Accounting Standard-17 on Segment Reporting issued by
the Institute of Chartered Accountants of India.
Geographical Segment:
The operations of the company are conducted within India and there is
no separate reportable geographical segment.
The disclosure of segment-wise information is given at Annexure-I.
5.4 Related party
A. As per Accounting Standard-18 Related Party Disclosures issued by
the Institute of Chartered Accountants of
India the names of the related parties are given below:
Nature of Relationship Name of the Related Party
Joint Venture Urvarak Videsh Limited
Nature of Relationship Name of the Related Party
Key Management Personnel - Shri V. K. Sharma, Chairman &
Managing Director
(C&MD) w.e.f. 27th August 2009 and prior to that Director (Technical)
holding additional charge as C&MD.
- Shri K.B. Sachdev, Director (Marketing) upto 30
- Ms. NeeruAbrol, Director (Finance)
B. Transactions with Related parties:
i) There is no transaction with related party at A above except
investment of Rs.0.10 crore towards its paid-up capital (in respect of
total investment of Rs.0.15 crore as on 31.03.2010, full provision has
been made in the Accounts).
ii) Remuneration to key management personnel atAabove is Rs. 0.82 crore
(Previous year Rs.0.61 crore)
5.5 As per requirements of the listing agreements with the stock
exchanges, the requisite details of loans and advances in the nature of
loans given by the Company are as under:
i) There are no loans and advances in the nature of loans to any
subsidiary.
ii) No loans have been given (other than loans to employees), wherein
there is no repayment schedule or repayment is beyond seven years; and
iii) There are no loans and advances in the nature of loans to
firms/companies in which Directors are interested.
5.6 Operating Leases
Assets taken on Operating lease:
The Companys leasing arrangements are in respect of operating leases
of premises for offices, godowns, residential use of employees and
vehicles. These leasing arrangements are usually renewable on mutually
agreed terms but are not non-cancellable. Schedule 2.5 - Employees
remuneration and benefits include Rs.0.61 crore (Previous year Rs.1.03
crore) towards lease payments, net of recoveries, in respect of
premises for residential use of employees. Lease payments in respect of
premises for offices, godowns and vehicles, Rs. 3.88 crore (Previous
year Rs. 3.64 crore) are shown in Schedule 2.8 - Other expenses.
5.7 Interest in Joint Venture
The disclosure of Companys interest in Joint Venture entity in terms
of Accounting Standard-27 on Financial Reporting of Interests in Joint
Ventures issued by the Institute of Chartered Accountants of India is
as under: -
i) Name of the Joint Venture entity: Urvarak Videsh Limited
ii) Co-Joint Venture companies: Krishak Bharti Co-operative Ltd. and
Rashtriya Chemicals & Fertilizers Ltd. as equal partners.
iii) Company has an investment of Rs.0.15 crore towards paid up equity
capital representing one third share.
iv) The Companys share of ownership interest, assets, liabilities,
income, expenses, contingent liabilities and capital commitment in the
Joint Venture Company, incorporated in India, are given below:
6. Figures in brackets pertain to previous year and have been
re-arranged / regrouped / re-cast, wherever necessary.