Enter the first few characters of Company and click 'Go'

Notes to Accounts of Southern Petrochemicals Industries Corporation Ltd.

Mar 31, 2023

1. Discounting rate used for the purpose of computing right to use asset is 8%.

2. Rental amount per annum is '' 146.05 lac, which also carries a clause for extension of agreement based on mutual understanding between Lessor and Lessee.

3. The lease period is from 3 to 5 years over which the right to use asset is depreciated on a straight line basis.

4. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions. The lease agreements do not impose any major covenants other than the security deposit in the leased assets that are held by the lessor.

5. Expense relating to short term Leases (included in other expenses - Refer Note 31 ) amounting to Rs.255.50 lac (previous year Rs.225.15 lac).

6. The company did not enter into lease contracts that contain variable lease options.

7. The total cash outflow for the lease for the year ended 31 March 2023 was Rs.146.05 lac (previous year Rs.142.46 lac)

8. Interest expense (included in finance cost- Refer Note 29) Rs. 22.18 lac (previous year Rs.22.05 lac) and depreciation expense (included in depreciation- Refer Note 30) Rs.128.20 lac (previous year Rs.127.83 lac)

Note 5.1: Fair value of the Companyâs investment property

The fair value of the property is Rs.277.53 lacs, as per valuation performed by M/s. Colliers (India) Pvt. Ltd., an accredited independent valuer during the previous year. M/s. Colliers (India) Pvt. Ltd. is a specialist in valuing these types of Investment properties. The above property has not been subjected to valuation by an independent certified valuer for current year. There is no diminution on the fair value as compared to the previous year based on available market / guideline value.

Fair value was derived using the market comparable approach based on recent market/government guidelines prices without any significant adjustments being made to the market observable data. In estimating the fair value of the property, the current use is considered as the highest and best use.

a) Gold Nest Trading Company Limited applied to Ministry of Corporate Affairs on 28^th March 2022, for removal of Company name from the Register of Companies and approval was received on 19^th September 2022. Accordingly the Company was dissolved effective on 19^th September 2022. Hence the Investment had been written off against provision.

b) 9086502 (previous year 5686502) equity shares held by the company in Greenam Energy Private Limited are pledged in favour of Indian Renewable Energy Development Agency Lmited, to secure the term loan of Rs. 9500.00 lac (previohs year Rs.8800 lac) availed by Greenam. The company has also given undertaking for non disposal of said shares during the tenure of the loan.

15 (iv) Equity shares include :

1,67,91,800 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York, Mellon, as depository for the GDRs.

15 (v) No class of shares have been issued as bonus shares during the period of 5 years immediately preceding the year end.

15 (vi) No class of shares have been bought back by the Company during the period of five years immediately preceding the current year end.

15 (vii) Terms/rights attached to Equity Shares:

The company has only one class of equity shares having a par value of '' 10 per share. All these shares have the same rights and preferences with respect to payment of dividend, repayment of capital and voting.

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

Capital Reserve and Statutory Reserve

Capital Reserve of '' 97.24 lac and Statutory Reserve of '' 41.33 lac represents reserves transferred to the Company on amalgamation of SPIC Holdings and Investments Ltd (SHIL) with the Company during 2006-07.

Capital Redemption Reserve

Capital redemption reserve has been created pursuant to the requirements of the Act under which the Company is required to transfer certain amounts on redemption of the preference shares. The Company had redeemed the underlying preference shares in the earlier years. During the previous year, the Company had redeemed the Redeemable Cumulative nonconvertible preference shares amounting to '' 1250 lacs and accordingly had transferred '' 1250 lacs to Capital Redemption Reserve from the Statement of Profit and Loss. The capital redemption reserve can be utilised for issue of bonus shares.

Note 32 :Plant Operation

(i) During the year the Company achieved a production of 7.59 lac MT (previous year 6.20 lac MT).

(ii) The Company has become a gas-based Urea manufacturing unit since 13 March 2021 and is therefore eligible for higher fiscal incentives in the form of subsidy income due to higher energy norms from the above said date for the next five-year period. Since the Company is not connected to the National Gas Grid, it will be kept out of âGas Pooling Mechanismâ as per the Office Memorandum received from Ministry of Chemical & Fertilizers dated 13 August 2021.

(iii) Subsidy for the year 1 April 2022 to 31 March 2023 of '' 217460.11 lac has been accounted based on the provisional Retention Price (RP) computed in line with the Government''s policy indicated in the notification dated 17 June 2015, as the final retention price has not been announced by the Department of Fertilizers. The necessary adjustments, if any, will be made when the final retention price is notified by the Department of Fertilizers.

Note 33: Commitments

Capital Commitments:

Estimated amounts of contracts remaining to be executed on capital account and not provided for (net of advances) '' 1110.99

lac (Previous year '' 2379.48 lac).

Note 34 :Contingent Liabilities

(a) Claims not acknowledged as debts:

(i) The District Collector, Tuticorin vide his letter dated, 21 August 2009 had demanded '' 16873.97 lac (Previous year '' 16873.97 lac) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008. While raising this demand, the District Collector had ignored the proposal submitted by the Company during 1975 to the State Government seeking assignment of the said land which is still pending. The Company had filed a writ petition challenging the demand before the Hon''ble Madras High Court and the court granted interim stay vide its order dated 21 April 2010 on further proceedings. During November 2010 the District Collector, Tuticorin has filed a counter before Hon''ble Madras High Court praying for the vacation of interim stay and the case is still pending.

(ii) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company alongwith other beneficiaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 47 years. Water charges were paid to TWAD on the basis of actual receipt by individual industries. The claims including interest made by TWAD for '' 4685.35 lac (Previous year '' 4345.19 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2023 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(iii) The Company has received a demand from VOC Port Trust towards increase in rental charges from 1 July 2007 onwards. The amount payable as on 31.03.2023 is '' 1404.48 lac (from 01.07.2007 to 31.03.2023) (Previous year '' 1293.54 lac). The Company obtained an injunction from the Madurai Bench of the Hon''ble Madras High Court against the claim made by the VOCPT and the stay has been granted till 10 June 2015. On 23.07.2015, Madurai Bench of the Hon''ble Madras High Court extended the stay until further orders.

(iv) The Company has received a demand from Office of the Joint Commissioner of Central GST and Central Excise for recovery of excess refund of Input tax credit of '' 934.50 lacs, based on the amended definition of âNet Input Tax Credit'' for the purpose of GST refund on account of inverted duty structure with effect from July 1,2017 to March 2018, to include input tax credit availed only on inputs which excludes input services vide GST Notification No. 26/2018 dated June 13, 2018. Management has filed writ petitions challenging the retrospective amendment of the definition of Input Tax Credit and is confident of obtaining a favorable order. Considering such credit is available for utilization also, the management is confident of utilization of aforesaid input tax credit.

(b) No provision has been considered necessary by the Management for the following disputed Excise duty, Service tax, Sales tax and Electricity tax demands which are under various stages of appeal proceedings. The Company has been advised that there are reasonable chances of successful outcome of the appeals and hence no provision is considered necessary for these demands.

B. Defined benefit plans

Gratuity:

In respect of Gratuity plan, the most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out on 31st March 2023 by the Actuary. The present value of the defined benefit obligation and the related current service cost and past service cost were measured using the projected unit cost method. The following table sets forth the status of the gratuity plan of the company and the amount recognized in the balance sheet and statement of profit and loss. The company provides the gratuity benefit through annual contributions to a fund managed by the Life Insurance Corporation of India (LIC).

The gratuity plan is governed by the Payment of Gratuity Act, 1972. Employee who has completed five years of service is entitled to specific benefit depending on the employee''s length of service and salary at retirement or relieving age.

Gratuity for employees is covered under a scheme of Life Insurance Corporation of India (LIC) which is basically a year-on-year cash accumulation plan. As part of the scheme the interest rate is declared on yearly basis and is guaranteed for a period of one year. The insurance company, as part of the policy rules, makes payment of all gratuity settlements during the year subject to sufficiency of funds under the policy.

Long Term Compensated Absences - Unfunded

Leave Encashment (Unfunded) payable to eligible employees who have earned leaves, during the employment and/or on separation, as per the company''s policy, is estimated as per actuarial valuation using projected unit credit method

There is no provision for tax under normal computation in view of the brought forward losses/unabsorbed depreciation relating to earlier years available for set off. Provision for Minimum Alternate Tax (MAT) under section 115-JB of the Income Tax Act, 1961 has been made for the year ended 31 March 2023 for an amount of Rs. 7481.09 lacs, (including Rs 2112.27 lacs relating to the previous year ended 31 March 2022). Deferred tax charge /(credit) is net of MAT credit entitlement asset of Rs. 7481.09 lacs for the year ended 31 March 2023 based on assessment ( including application of sensitivity analysis on key inputs) of future profitability where it is reasonably certain that the same would be utilised within the time period in keeping with the provisions of Income tax Act.

Note 37: Segment Reporting

The information reported to the Chief Operating Decision Maker (CODM) for the purpose of resource allocation and assessment of segment performance is based on types of goods and services. Accordingly, the Company''s reportable segments under Ind AS 108 are as follows:

(i) Agro inputs - Urea Operations

(ii) Others - Agri Business

The following is an analysis of the Company''s revenue and results from operations by reportable segments:

The Company monitors capital using a gearing ratio, which is net debt divided by total capital. The Company includes within net debt, all non-current and current borrowings reduced by cash and cash equivalents.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current year. No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March 2023 and 31 March 2022.

The Company''s activities expose it to a variety of financial risks, credit risks, liquidity risks and market risks.

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

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

1. Credit Risk

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks and financial institutions, foreign exchange transactions and other financial instruments.

Trade receivables and subsidy receivable

The Company receivables can be classified into two categories, one is from the customers into the market and second one is from the Government in the form of subsidy. As far as Government portion of receivables are concerned, credit risk is nil. For market receivables from the customers, the Company extends credit to customers in normal course of business. The Company considers factors such as credit track record in the market and past dealings for extension of credit to customers. The Company monitors the payment track record of the customers. Outstanding customer receivables are regularly monitored. The Company evaluates the concentration of risk with respect to trade receivables as low, as its customers are located in several jurisdictions and operate in largely independent markets. The Company has also taken security deposits from its customers, which mitigate the credit risk to some extent.

The credit risk on cash and bank balances is limited because the counterparties are banks with high credit ratings assigned by international credit rating agencies.

2. Liquidity Risks

Liquidity risk is the risk that the company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The company''s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the company''s reputation.

3. Market Risk

Market risk is the risk that changes in market prices, such as foreign exchange rates and Interest rates will affect the company''s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters while optimising the returns.

4. Foreign Currency Risks

The company is exposed to currency risk to the extent that there is a mismatch between the currencies in which transactions are denominated and the functional currency of the company. The functional currency of the company is Indian Rupees (INR). The currency in which these transactions are primarily denominated is US Dollars (USD).

b. Foreign currency sensitivity analysis

The Company is mainly exposed to fluctuations in US Dollar. The following table details the Company''s sensitivity to a Rs. 2 increase and decrease against the US Dollar. Rs.2 is the sensitivity used when reporting foreign currency risk internally to key management personnel and represents management''s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes only net outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a Rs. 2 change in foreign currency rates. A positive number below indicates an increase in profit or equity where the Rupee strengthens by Rs. 2 against the US Dollar. For a Rs. 2 weakening against the US Dollar, there would be a comparable impact on the profit or equity.

5. Interest Rate Risks

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Company''s outstanding debt in local currency is on fixed rate basis and hence not subject to interest rate risk.

6. Commodity Price Risk

The company''s operating activities require the ongoing purchase of imported raw materials and also domestic natural gas purchase. Naphtha and fuel oil being an international commodity is subject to price fluctuation on account of the change in the crude oil prices, demand supply pattern of naphtha and exchange rate fluctuations. Further the natural gas price is also linked to the oil prices.

Note 42 Registration of charges or satisfaction with Registrar of Companies

The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.

Note 43 Wilful Defaulter

The company has not been declared as a wilful defaulter by Reserve Bank of India, Banks, Financial Institutions or any other

Lender.

Note 44 Compliance with number of layers of companies

The company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with the

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

Note 45 Utilisation of Borrowed funds and Securities Premium

a) The Company has not advanced or loaned or invested funds during the reporting periods to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding whether recorded in writing or otherwise that the Intermediary shall: (i) 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 (ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

b) The Company has not received any fund during the reporting periods 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: (i) 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 (ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.

Note 46 Undisclosed income:

The Company does not have any undisclosed income which is not recorded in the books of account that has been surrendered or disclosed as income during the year / previous year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

Note 47:

Details of Crypto Currency or Virtual Currency

The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

Note 48:

Corporate Social Responsibility

In view of absence of Profit as per the computation of Section 198 of the Companies Act 2013, Company is not required to spend towards CSR Activity as per Section 135 of Companies Act, 2013

Note 49:

The Code on Social Security, 2020 (âCode'') relating to employee benefits during employment and post-employment benefits, received Presidential assent in September 2020. The Code has been published in the Gazette of India. However, the date from which the Code will come into effect has not been notified. The Company will assess the impact of the Code when it comes into effect and will record any related impact in the period the Code becomes effective

Note 50:

The Board of Directors has recommended a dividend of Re.1.50 per share on 20,36,40,336 equity shares of ''10/- each for the financial year 2022-23, subject to approval of Members at the Annual General Meeting.

Mar 31, 2021

Note 13(iii): Equity shares include:

1,67,91,800 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York Mellon, as depository for the GDRs

Terms / Rights attached to Equity Shares:

Note 13(iv): Terms/ rights attached to Preference Shares

In the event of non-declaration of dividend in respect of any financial year, arrears of dividend will be declared in the subsequent financial years subject to the provisions of the Companies Act, and / or any statutory modifications thereto, or re-enactments thereof as may be in force from time to time, prior to payment of dividend on equity shares.

Capital Reserve and Statutory Reserve

Capital Reserve of ''97.24 lac and Statutory Reserve of ''41.33 lac represents reserves transferred to the Company on merger of SPIC Holdings and Investments Ltd (SHIL) with the Company during 2006-07.

Capital Redemption Reserve

Securities Premium Account

Securities premium reserve represents the amount received in excess of the face value of the equity shares. The utilisation of the securities premium reserve is governed by the Section 52 of the Act.

Note 16(i): During the year the Company had obtained working capital demand loan from HDFC Bank of '' 5000 lac at interest of 8% p.a based on the security of inventory, book debts and factory land.

Note 16(ii): During the year the Company for meeting its capex requirements had obtained loan from New India Co-operative Bank Ltd. of '' 1700 lac at interest of 11.50% p.a based on the security of land.

Note 16(iii): 14.50% Redeemable cumulative non-convertible preference shares of ''300 lac issued on private placement basis, redeemable at par after the expiry of 60 months from the date (s) of allotment, have fallen due for redemption during the year 2001-02.

Note 16(iv): 11.50% Redeemable cumulative non-convertible preference shares of ''850 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2002-03.

(i) During the year the Company achieved a production of 6.20 lac MT.

(ii) Government of India vide its notification dated 17 June 2015 had permitted the Company to produce Urea using Naphtha as feedstock on existing provisions till assured supply of gas is made available. Company has started receiving natural gas from 13 March 2021 and has become a gas-based urea manufacturing unit. The Subsidy would be paid based on the Retention Price computed on the lower of Naphtha/Fuel oil or RLNG price until March 12, 2021. From 13 March 2021 the company is eligible for fiscal incentives by higher energy norms.

(iii) Subsidy for the period 1 April 2020 to 31 March 2021 of ''111835.90 lac has been accounted based on the provisional Retention Price (RP) computed in line with the Government''s policy indicated in the notification dated 17 June 2015, as the final retention price has not been announced by the Department of Fertilizers. The necessary adjustments, if any, will be made when the final retention price is notified by the Department of Fertilizers.

Note 28: CommitmentsCapital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) '' 7476 lac (Previous year '' 10951.17 lac).

Note 29: Contingent Liabilities(a) Claims not acknowledged as debts

(i) The District Collector, Tuticorin vide his letter dated, 21 August 2009 had demanded '' 16873.97 lac (Previous year ''16873.97 lac) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008. While raising this demand, the District Collector had ignored the proposal submitted by the Company during 1975 to the State Government seeking assignment of the said land which is still pending. The Company had filed a writ petition challenging the demand before the Hon''ble Madras High Court and the court granted interim stay vide its order dated 21 April 2010 on further proceedings. During November 2010 the District Collector, Tuticorin has filed a counter before Hon''ble Madras High Court praying for the vacation of interim stay and the case is still pending.

(ii) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed vide their letter dt. 26 February 2009, payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company alongwith other beneficiaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 45 years. Water Charges were paid to TWAD on the basis of actual receipt by individual industries. The claims including interest made by TWAD for '' 4032.15 lac (Previous year '' 3719.80 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2021 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(iii) The Company has received a demand from VOC Port Trust towards increase in rental charges from 1 July 2007 onwards. The amount payable as on 31.03.2021 is '' 1,184.79 lac (from 01.07.2007 to 31.03.2021) (Previous year '' 1,078.11 lac). The Company obtained an injunction from the Madurai Bench of the Hon''ble Madras High Court against the claim made by the VOCPT and the stay has been granted till 10 June 2015. On 23.07.2015, Madurai Bench of the Hon''ble Madras High Court extended the stay until further orders.

Note 34.1: Capital Management

For the purpose of the Company''s capital management, capital includes issued equity capital and all other equity reserves attributable to the equity shareholders. The primary objective of the Company''s capital management is to ensure that it maintains a strong credit rating and capital ratios in order to support its business and maximise shareholder value. The Company determines the amount of capital required on the basis of annual operating plan and long-term strategic plans. The funding requirements are met through internal accruals and long-term/short-term borrowings. The Company monitors the capital structure on the basis of Net debt to equity ratio and maturity profile of the overall debt portfolio of the Company.

The Company''s activities expose it to a variety of financial risks, credit risks, liquidity risks and market risks.

The Company''s board of directors has overall responsibility for the establishment and oversight of the risk management framework.

1. Credit Risk

Trade receivables and subsidy receivable

2. Liquidity Risk

3. Market Risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include borrowings, investments and derivative financial instruments.

Market risk exposures are measured using sensitivity analysis.There has been no change to the Company''s exposure to market risks or the manner in which these risks are being managed and measured.

4. Foreign Currency Risk

The company is exposed to currency risk to the extend that there is a mismatch between the currencies in which transactions are denominated and the functional currency of the company. The functional currency of the company is Indian Rupees (INR). The currency in which these transactions are primarily denominated is US Dollars (USD).

5. Interest Rate Risk

6. Commodity Price Risk

The company''s operating activities require the ongoing purchase of naptha and fuel oil. Naptha and fuel oil being an international commodity is subject to price fluctuation on account of the change in the crude oil prices, demand supply pattern of naptha and exchange rate fluctuations. The company is affected by the price volatility of the naptha/ fuel oil as under the Urea pricing formula the subsidy would be paid based on the retention price computed on the lower of naptha/fuel oil or Regasified Liquified Natural Gas (RLNG).

Mar 31, 2018

Note 1: General Information

Southern Petrochemical Industries Corporation Limited (âthe Company''/âSPIC''), having its registered office at Chennai is a Public Limited Company, incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange of India. The Company is manufacturing and selling Urea, a Nitrogenous chemical fertilizer and has its manufacturing facility at Tuticorin.

The Company has been appointed as the Handling Agent by Government of India for handling, packaging, transporting and sale of imported Urea at Karaikal and Tuticorin Ports.

Note 2: Significant accounting judgments, estimates and assumptions

The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future years.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the year end date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising that are beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

a. Taxes

Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilized. Significant management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

The Company neither have any taxable temporary difference nor any tax planning opportunities available that could partly support the recognition of these losses as deferred tax assets. On this basis, the Company has determined that it cannot recognize deferred tax assets on the tax losses carried forward except for the unabsorbed depreciation.

b. Defined benefit plans (gratuity benefits and compensated absences)

The cost of the defined benefit plans such as gratuity and compensated absences are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments in the future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each year end.

The principal assumptions are the discount and salary growth rate. The discount rate is based upon the market yields available on government bonds at the accounting date with a term that matches that of liabilities. Salary increase rate takes into account of inflation, seniority, promotion and other relevant factors on long term basis. For details refer Note 36.

c. Useful lives of Property, Plant and Equipment

The Company reviews the estimated useful lives of property, plant and equipment at the end of each reporting period. During the current year, there has been no change in life considered for the assets.

d. Revenue Recognition

The Company provides customer incentives, such as rebates, based on quantity purchased, timing of collections etc. Various estimates are made to recognise the impact of rebates and other incentives on revenue. These estimates are made based on historical and forecasted data, contractual terms and current conditions.

e. Subsidy Income

Subsidy income is recognised on the basis of the rates notified from time to time by the Government of India in accordance with the New Pricing Scheme for Urea on the quantity of Urea sold by the Company for the period for which notification has been issued and for the remaining period, based on estimates.

f. Provision for doubtful receivables

The Company makes provision for doubtful receivables based on a provision matrix which takes into account historical credit loss experience and adjusted for current estimates.

Note 3: Standards (including amendments) issued but not yet effective

The standards and interpretations that are issued, but not yet effective up to the date of issuance of the financial statements are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective.

a. Appendix B to Ind AS 21, Foreign currency transactions and advance consideration

On 28 March 2018, Ministry of Corporate Affairs ("MCA") has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 containing Appendix B to Ind AS 21, Foreign currency transactions and advance consideration which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency. The amendment will come into force from 1 April 2018.

b. Ind AS 115- Revenue from Contract with Customers

On 28 March 2018, Ministry of Corporate Affairs ("MCA") has notified the Ind AS 115, Revenue from Contract with Customers. The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity''s contracts with customers.

The standard permits two possible methods of transition:

(i) Retrospective approach - Under this approach the standard will be applied retrospectively to each prior reporting period presented in accordance with Ind AS 8- Accounting Policies, Changes in Accounting Estimates and Errors

(ii) Retrospectively with cumulative effect of initially applying the standard recognized at the date of initial application (Cumulative catch - up approach)

The effective date for adoption of Ind AS 115 is financial periods beginning on or after 1 April 2018.

The Company is currently evaluating the requirements of these amendments. The Company believes that the adoption of the above standards are not expected to have any significant impact on the Company''s financial statements.

Note 4: First-time adoption to Ind AS

These financial statements are the first set of Ind AS financial statements prepared by the Company. Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for year ending on 31 March 2018, together with the comparative year data as at and for the year ended 31 March 2017, as described in the significant accounting policies. In preparing these financial statements, the Company''s opening balance sheet was prepared as at 1 April 2016, being the Company''s date of transition to Ind AS. This note explains the principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1 April 2016 and the financial statements as at and for the year ended 31 March 2017.

Note 5.: Exemptions availed on first time adoption of Ind AS

Ind AS 101, First-time Adoption of Indian Accounting Standards, allows first-time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The Company has accordingly applied the following exemptions.

a. Deemed cost

Since there is no change in the functional currency, the Company has elected to continue with carrying value for all of its property, plant and equipment as recognized in its Indian GAAP financial statements as its deemed cost at the date of transition. This exemption can also be used for intangible assets covered by Ind AS 38, Intangible Assets and investment properties. Accordingly the management has elected to measure all of its property, plant and equipment, investment properties and intangible assets at their Indian GAAP carrying value.

b. Impairment of financial assets

The company has applied the impairment requirements of Ind AS 109 retrospectively; however, as permitted by Ind AS 101, it has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognised in order to compare it with the credit risk at the transition date. Further, the Group has not undertaken an exhaustive search for information when determining, at the date of transition to Ind ASs, whether there have been significant increases in credit risk since initial recognition, as permitted by Ind AS 101.

Note 6.: Mandatory Exemption on first-time adoption of Ind AS

a. Estimates

An entity''s estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with Indian 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 2016 are consistent with the estimates as at the same date made in conformity with Indian GAAP. The Company made estimates for following items in accordance with Ind AS at the date of transition as these were not required under Indian GAAP:

(i) Impairment of financial assets based on expected credit loss model.

(ii) FVTOCI - equity securities

b. Derecognition of financial assets and financial liabilities

The company has applied the derecognition requirements of financial assets and financial liabilities prospectively for transactions occurring on or after 1 April 2016 (the transition date).

c. Classification of debt instruments

The company has determined the classification of debt instruments in terms of whether they meet the amortised cost criteria or the FVTOCI criteria based on the facts and circumstances that existed as of the transition date.

d. Equity instruments at FVTOCI

The Company has designated investment in equity shares other than associate and joint ventures as at FVTOCI on the basis of facts and circumstances that existed at the transition date.

Note 7.: Reconciliations

The following reconciliations provides the effect of transition to Ind AS from Indian GAAP in accordance with Ind AS 101, First-time Adoption of Indian Accounting Standards:

(g) Notes to first-time adoption

(i) Redeemable preference shares

The Company had issued fully non convertible preference shares. They carry fixed cumulative dividend and non convertible at the option of the holder into the equity instruments of the Company. Under Indian GAAP, non convertible preference shares were classified as equity. Under Ind AS, non convertible preference shares are separated into liability and equity components based on the terms of the contract. Interest on liability component is recognized using the effective interest method. Thus the non convertible preference shares equity amount under Indian GAAP is reduced by Rs.1250 lac as on 31 March 2017 (1 April 2016 Rs.1250 lac) with a corresponding increase in borrowings as liability component.

(ii) Defined benefit liabilities

Both under Indian GAAP and Ind AS, the Company recognized costs related to its post-employment defined benefit plan on an actuarial basis. Under Indian GAAP, the entire cost, including actuarial gains and losses, are charged to Statement of Profit and Loss. Under Ind AS, re-measurements comprising of actuarial gains and losses are recognized immediately in the balance sheet with a corresponding debit or credit to retained earnings through OCI. Thus the employee benefit cost for the year ended 31 March 2017 is reduced by Rs.78.06 lac and re-measurement gains/ losses on defined benefit plans of the corresponding amount has been recognized in the OCI, net of taxes.

(iii) Deferred tax

Indian GAAP requires assessment of virtual certainty in case of losses for recognizing deferred tax asset, but under Ind AS deferred tax assets are recognized for all deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilize those temporary differences and losses. The company has recognized deferred tax asset on unabsorbed depreciation resulting in an additional deferred tax asset of Rs.4568.02 lac as of 1 April 2016 and Rs.4568.02 lac as on 31 March 2017.

(iv) Investment Property

Under previous GAAP, there was no requirement to present investment property separately and the same was included under fixed assets and measured at cost less accumulated depreciation. Under Ind AS, investment property is required to be presented separately in the balance sheet and depreciation is charged on it. Accordingly, the carrying value of investment property as at 1 April 2016 of Rs.139.59 lac and as at 31 March 2017 of Rs.136.12 lac under previous GAAP has been reclassified to a separate line item on the face of the balance sheet.

(v) Revenue

Under Ind-AS, cash discounts are considered part of the overall consideration receivable and is recognized on an estimated basis at the time of sales. Under Indian GAAP cash discounts are recognized at the time of collection from debtors and is disclosed as part of other expenses. The change does not affect total equity as at 1 April 2016 and 31 March 2017, profit before tax or total profit for the year ended 31 March 2017.

(vi) Excise Duty

Under previous GAAP, revenue from sale of products was presented net of excise duty under revenue from operations. Whereas, under Ind AS, revenue from sale of products includes excise duty. The corresponding excise duty expense is presented separately on the face of the consolidated statement of profit and loss. The change does not affect total equity as at 1 April 2016 and 31 March 2017, profit before tax or total profit for the year ended 31 March 2017.

(vii) Fair valuation of investments

Under previous GAAP, current investments were measured at lower of cost or fair value. Under Ind AS, these financial assets have been classified as FVTOCI on the date of transition. The fair value changes are recognised in profit or loss. On transitioning to Ind AS, these financial assets have been measured at their fair values which is higher than cost as per previous GAAP, resulting in an increase in carrying amount by Rs.347.74 lac as at 31 March 2017 and decrease in carrying amount by Rs.10.14 lac as at 1 April 2016. The corresponding deferred taxes have also been recognised as at 31 March 2017 Rs.69.54 lac and as at 1 April 2016 Rs. (2.03) lac. The net effect of these changes is an increase in total equity as at 31 March 2017 of Rs.278.18 lac (as at 1 April 2016 Rs. (8.13) lac).

Note 8: Fair value of the Company''s investment property

As at 31 March 2018 and 31 March 2017, the fair values of the property are INR Rs.316.96 lac and INR Rs.316.96 lac respectively. These valuations are based on valuations performed by M/s. Anbusivam Valuers., an accredited independent valuer. M/s. Anbusivam Valuers, is a specialist in valuing these types of investment properties. A valuation model in accordance with that recommended by the International Valuation Standards Committee has been applied.

Note 9.: Under previous GAAP, there was no requirement to present investment property separately and the same was included under fixed assets and measured at cost less accumulated depreciation. Under Ind AS, investment property is required to be presented separately in the balance sheet and depreciation is charged on it. Accordingly, the carrying value of investment property as at 1 April 2016 of Rs.139.59 lac and as at 31 March 2017 of Rs.136.12 lac under previous GAAP has been reclassified to a separate line item on the face of the balance sheet.

(i) The Company has given an undertaking to the lenders of Tuticorin Alkali Chemicals and Fertilisers Limited for non disposal of its shareholdings in the said Company without their prior approval.

(ii) Consequent to the Scheme of Arrangement (Demerger) between SICAL Logistics Limited and SICAGEN India Limited, sanctioned by the Hon''ble High Court of Madras, by its order dated 20 December 2007, the Company was allotted 5,77,681 Equity Shares of the face value of Rs. 10 each in SICAGEN India Limited.

(iii) The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in 1994-95 for the manufacture of Polyester Filament Yarn and Purified Terepthalic Acid. The Company had invested Rs.25375.00 lac in the equity share capital, Rs.5.00 lac in preference share capital and Rs.30609.63 lac in Unsecured Zero Interest Bonds. Consequent to the litigation between Chennai Petroleum Corporation Limited (CPCL) and the Company , the implementation of the project was injuncted . On the winding up petitions that were filed by certain unsecured creditors, the Hon''ble Madras High Court ordered the winding up of the Company on 17 April 2009.

In view of the above developments, full provision had already been made in the earlier years for the carrying value of investments and also for all other dues from this Company.

(iv) During the year, the Company invested in:

(a) 1,86,000 numbers of Equity shares at Rs.10/- each, at a premium of Rs.1.50/- per share, aggregating Rs.21.39 lac in OPG Power Generation Private Limited pursuant to the Share Purchase and Shareholders Agreement dated 22 December 2016 and the Addendum thereto dated 22 June 2017 for purchase and consumption of 10MW of power at a concessional tariff as applicable under Group Captive Scheme of the Government of India under Electricity Rules, 2005 to achieve savings in cost of power.

(b) 2 equity shares at Rs.10/- each at par in M/s. Greenam Energy Private Limited, a company incorporated for setting up a 25 - 29 MW DC solar power project.

(a) 1,66,66,666 shares of Rs.10 each fully paid up, issued in the year 2009-10 to Asset Reconstruction Company (India) Ltd., (ARCIL) at an issue price of Rs.18 per share inclusive of a premium of Rs.8 per share in accordance with Issue of Capital and Disclosure Requirements Regulations, 2009 ("SEBI ICDR Regulations") by conversion of secured debts of a sum of Rs.3000 lac in to equity at the meeting of the Board of Directors held on 30 March 2010.

(b) 32,14,734 shares of Rs. 10 each fully paid up, at an issue price of Rs. 19 per share inclusive of premium of Rs. 9 per share in accordance with SEBI ICDR Regulations,2009 alloted to secured lenders on conversion of secured debts of Rs. 610.80 lac at the meeting of the Board of Directors held on 8 November 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 6 August 2010 and the shareholders at the AGM held on 21 September 2010.

(c) 1,06,71,001 shares of Rs.10 each fully paid up, at an issue price of Rs.20 per share inclusive of premium of Rs. 10 per share in accordance with SEBI ICDR Regulations, 2009 alloted to ARCIL on conversion of secured debts of Rs.2134.20 lac at the meeting of the Board of Directors held on 8 December 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 28 October 2010 and the shareholders at the EGM held on 29 November 2010.

(d) 12,631 equity shares of Rs.10 each fully paid up issued to Industrial Investment Bank of India, on preferential basis, at an issue price of Rs. 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs. 2.40 lac, at the meeting of the Shareholdersâ. / Investor''s Grievance Committe held on 27 April 2012.

(e) 72,631 equity shares of Rs.10 each fully paid up issued to United India Insurance Company Ltd., on preferential basis, at an issue price of Rs. 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs. 13.80 lac, at the meeting of the Shareholders'' / Investor''s Grievance Committe held on 9 November 2012.

(f) 3,72,76,700 equity shares of Rs.10 each fully paid up were issued to AMI Holdings Pvt Ltd, a company belonging to promoter group, on preferential basis, at an issue price of Rs. 17.50 per share, which included a premium of Rs.7.50 per share by way of conversion of 3,72,76,700 warrants, at the meetings of Shareholders'' / Investor''s Grievance Committe held on 10 January 2013 and 13 March 2013.

(g) 1,69,41,800 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York, Mellon, as depository for the GDRs.

Terms/rights attached to Equity Shares:

The company has only one class of equity shares having a par value of Rs. 10 per share. All these shares have the same rights and preferences with respect to payment of dividend, repayment of capital and voting.

16 (iv): Terms/rights attached to Preference Shares

Capital Reserve and Statutory Reserve :

Capital Reserve of Rs. 97.24 lac and Statutory Reserve of Rs. 41.33 lac represents reserves transferred to the Company on merger of SPIC Holdings and investments Ltd (SHIL) with the Company during 2006-07.

Capital Redemption Reserve

Capital redemption reserve has been created pursuant to the requirements of the Companies Act 2013, under which the Company is required to transfer certain amounts on redemption of the preference shares. The Company has redeemed the underlying preference shares in the earlier years. The capital redemption reserve can be utilised for issue of bonus shares.

Securities Premium Account

Securities premium reserve represents the amount received as share premium in excess of the face value of the equity shares. The utilisation of the securities premium reserve is governed by the Section 52 of the Act.

18 (i): The Company has during November 2016 issued unsecured Indian Rupee denominated bonds (Masala Bonds) of Rs.6670 lac to AM International Holdings Pte Ltd, Singapore, which has been approved by the Board of Directors vide their meeting held on 20 September 2016. These bonds are repayable after three years and carry an interest of 9% which is payable at quarterly intervals falling due on 22 February, 22 May, 22 August and 22 November of each year.

Out of the total amount, the Company has utilised Rs.16275 lac (Previous year : Rs. 3409.50 lac) as at the Balance Sheet date.

(a) 14.50% Redeemable cumulative non-convertible preference shares of Rs.300 lac issued on private placement basis, redeemable at par after the expiry of 60 months from the date (s) of allotment, have fallen due for redemption during the year 2001-02.

(b) 11.50% Redeemable cumulative non-convertible preference shares of Rs.850 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2002-03.

(c) 10.00% Redeemable cumulative non-convertible preference shares of Rs.100 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2003-04.

23 (i): During the current year, the Company had received Order under Section 154 of the Income-tax Act 1961 for the financial year 2012-13, wherein demand of Rs. 8456.21 lac (including interest of Rs.2214.59 lac), has been raised against the Company. The demand was arising out of the book profits for the financial year 2012-13. Since the Company has accumulated losses under normal provision of the Income Tax Act, 1961, liability is determined under section 115 JB, Minimum Alternate Tax (MAT) provisions. An asset has been recognised in the Balance Sheet for the tax liability of Rs.6241.62 lac as it gives rise to future economic benefits in the form of tax credit against future income tax liability, as there is convincing evidence that the Company will utilise the asset to pay normal tax before the expiry of the period during which the credit is to be utilised. Interest liability of Rs.2214.59 lac has been included in Finance Cost.

(i) During the year the Company achieved a production of 6.588 lac MT against the maximum permissible production of 6.20 lac MT after getting Special permission from Department of Fertilizer. The Company, as handling agent of Government of India for marketing Urea within the country, had handled 0.508 lac MT of Urea and sold 0.792 lac MT.

(iii) Subsidy for the period 1 April 2017 to 31 March 2018 of Rs. 147300.21 lac has been accounted based on the provisional Retention Price (RP) computed in line with the Government''s policy indicated in the notification dated 17 June 2015, as the final retention price has not been announced by the Department of Fertilizers. The necessary adjustments, if any, will be made when the final retention price is notified by the Department of Fertilizers.

Note 10.: Commitments

Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 2754.84 lac (Previous year Rs. 1858.88 lac).

Note 11: Contingent Liabilities

(a) Claims not acknowledged as debts

(i) The District Collector, Tuticorin vide his letter dated, 21 August 2009 had demanded Rs. 16873.97 lac (Previous year Rs.16873.97 lac) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008. While raising this demand, the District Collector had ignored the proposal submitted by the Company during 1975 to the State Government seeking assignment of the said land which is still pending. The Company had filed a writ petition challenging the demand before the Hon''ble Madras High Court and the court granted interim stay vide its order dated 21 April 2010 on further proceedings. During November 2010 the District Collector, Tuticorin has filed a counter before Hon''ble Madras High Court praying for the vacation of interim stay and the case is still pending.

(ii) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company alongwith other beneficiaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 42 years. Water Charges were paid to TWAD on the basis of actual receipt by individual industries. The claims including interest made by TWAD for 2867.67 lac (Previous year Rs. 2795.28 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2018 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(iii) The Company has received a demand from VOC Port Trust towards increase in rental charges from 1 July 2007 onwards. The amount payable as on 31.03.2018 is Rs.870.80 lac (from 01.07.2007 to 31.03.2018) (Previous year Rs. 766.77 lac). The Company obtained an injunction from the Madurai Bench of the Hon''ble Madras High Court against the claim made by the VOCPT and the stay has been granted till 10 June 2015. On 23.07.2015, Madurai Bench of the Hon''ble Madras High Court extended the stay until further orders.

(b) Other Bank Guarantees outstanding Rs. 31.78 lac (Previous year Rs. 31.78 lac)

(c) No provision has been considered necessary by the Management for the following disputed Excise duty, Service tax, Sales Tax, Electricity tax and Employees State Insurance demands which are under various stages of appeal proceedings. The Company has been advised that there are reasonable chances of successful outcome of the appeals and hence no provision is considered necessary for these demands.

(i) Agro inputs - Urea Operations

(ii) Others - Agri Business

For the purpose of monitoring segment performance and allocating resources between segments:

1. All Assets are allocated to reportable segments other than Investments, Cash and cash equivalents and derivative contracts.

2. All liabilities are allocated to reportable segments other than borrowings, current and deferred tax liabilities.

Note 12: Financial Instruments

12.1: Capital Management

The Company''s capital management objective is to maximise the total shareholder return by optimising cost of capital through flexible capital structure that supports growth. Further, the Company ensures optimal credit risk profile to maintain / enhance credit rating.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents.

For the purpose of capital management, capital includes issued equity capital, securities premium and all other reserves. Net debt includes all long and short-term borrowings, trade and other payables as reduced by cash and cash equivalents.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period. No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March 2018 and 31 March 2017.

12.2: Financial Risk and Management Objectives

The Company''s activities expose it to a variety of financial risks, credit risks, liquidity risks and market risks.

The Company''s board of directors has overall responsibility for the establishment and oversight of the risk management framework.

1. Credit Risk

Credit risk is the risk of financial loss to the company, if a customer or the counter party to a financial instrument fails to meet its contractual obligations, and arises principally from the Company''s receivables from customers. The carrying amount of financial assets represents the maximum credit risk exposure.

Trade receivables

The company''s exposure to credit risks is influenced mainly by individual charecteristics of each customer. However management also considers the factors that may influence the credit risk of its customer base, including the default risk of the industry. Credit risk has always been managed by the company through its credit approvals, establishing credit limits and continuously monitoring the credit worthiness of its customer based on which the company agrees on the credit terms with the customers in the normal course of business. Credit risks on cash and cash equivalents and other bank balances is limited as the company generally transacts with banks.Credit risk from balances with banks, borrowings from related parties is managed by the Company in accordance with the guidelines framed by the board of directors of the Company. Guidelines broadly covers the selection criterion and over all exposure which the Company can take with a particular bank. The Company does not maintain any significant amount of cash and deposits other than those required for its day to day operations.

2. Liquidity Risks

3. Market Risk

4. Foreign Currency Risks

b Foreign currency sensitivity analysis

The following table demonstrates the sensitivity to a reasonably possible change in the US dollar exchange rate (or any other material currency), with all other variables held constant, of the Company''s profit before tax (due to changes in the fair value of monetary assets and liabilities). The Company''s exposure to foreign currency changes for all other currencies is not material.

5. Interest Rate Risks

6. Commodity Price Risk:

The Company''s operating activities requires the ongoing purchase of Naphtha and Furnace Oil. Naphtha and Furnace Oil being international commodities, are subject to price fluctuations on account of the change in the crude

oil prices, demand and supply pattern of Naphtha and Furnace Oil. The company is generally not affected by the price volatility of Naphtha and Furnace Oil as per the Urea pricing policy.

(a) Previous year figures have been regrouped / reclassified wherever necessary to conform presentation as required by Schedule III of the Act.

(b) Previous year figures are given in brackets.

(c) The Board of Directors has reviewed the realizable value of all current assets of the Company and has confirmed that the value of such assets in the ordinary course of business will not be less than the value at which these are recognized in the financial statements. Further, the board, duly taking into account all relevant disclosures made, has approved these financial statements for the year ended 31 March 2018 in its meeting held on 17 May 2018.

Mar 31, 2017

Note 1 (i): There is no movement in the number of equity shares and preference shares during the year and in the previous year.

Note 2 (iii): Equity shares include :

(a) 1,66,66,666 shares of Rs.10 each fully paid up, issued in the year 2009-10 to Asset Reconstruction Company (India) Ltd., (ARCIL) at an issue price of Rs.18 per share inclusive of a premium of Rs.8 per share in accordance with Issue of Capital and Disclosure Requirements Regulations, 2009 (âSEBI ICDR Regulationsâ) by conversion of secured debts of a sum of Rs. 3000 lac in to equity at the meeting of the Board of Directors held on 30 March 2010.

(b) 32,14,734 shares of Rs 10 each fully paid up, at an issue price of Rs 19 per share inclusive of premium of Rs 9 per share in accordance with SEBI ICDR Regulations,2009 alloted to secured lenders on conversion of secured debts of Rs. 610.80 lac at the meeting of the Board of Directors held on 8 November 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 6 August 2010 and the shareholders at the AGM held on 21 September 2010.

(c) 1,06,71,001 shares of Rs 10 each fully paid up, at an issue price of Rs 20 per share inclusive of premium of Rs 10 per share in accordance with SEBI ICDR Regulations, 2009 alloted to ARCIL on conversion of secured debts of Rs. 2134.20 lac at the meeting of the Board of Directors held on 8 December 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 28 October 2010 and the shareholders at the EGM held on 29 November 2010.

(d) 12,631 equity shares of Rs.10 each fully paid up issued to Industrial Investment Bank of India, on preferential basis, at an issue price of Rs 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs 2.40 lac, at the meeting of the Shareholders'' / Investor''s Grievance Committee held on 27 April 2012.

(e) 72,631 equity shares of Rs.10 each fully paid up issued to United India Insurance Company Ltd., on preferential basis, at an issue price of Rs 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs 13.80 lac, at the meeting of the Shareholders'' / Investor''s Grievance Committee held on 9 November 2012.

(f) 3,72,76,700 equity shares of Rs.10 each fully paid up were issued to AMI Holdings Pvt Ltd, a company belonging to promoter group, on preferential basis, at an issue price of Rs 17.50 per share, which included a premium of Rs.7.50 per share by way of conversion of 3,72,76,700 warrants, at the meetings of Shareholders'' / Investor''s Grievance Committee held on 10 January 2013 and 13 March 2013.

(g) 1,70,66,800 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York, Mellon, as depository for the GDRs.

Terms / rights attached to Equity Shares:

Note 3 (iv): Preference shares:

Terms / rights attached to Preference Shares

Note 5 (i): The company has during November 2016 issued unsecured Indian Rupee Denominated Bonds (Masala Bonds) Rs.6,670 lacs due on December 2019 to AM International Holdings Pte Ltd, Singapore, a related party,(also refer Note 35),which has been approved by the Board of Directors vide their meeting held on 20 September 2016. These bonds carry an interest of 9% which is payable at quarterly intervals falling due on 22nd February, 22nd May, 22nd August and 22nd November of each year. Out of the total amount, the Company has utilized Rs. 3409.50 lac as at the balance sheet date. There was a delay of 40 days in remittance of interest amounting to Rs. 72.76 lac, which fell due on 22 February 2017.

Note 6 (i): Represents sum received from State Bank of India under Special Banking Arrangement as approved by Ministry of Finance, Department of Expenditure O.M.s No7/55/2016-BA dated 11 January 2017 secured against subsidy receivables from the Government of India for the period August 2016 to February 2017. The bank has charged an interest of 8% p.a. on the said arrangement out of which interest @ 6.25% p.a. is to be borne by the Government of India and balance 1.75% is to be borne by the Company. Accordingly, Rs. 99.04 lac being the interest paid by the Company has been included under finance charges.

7(ii) Guaranteed by fixed deposit placed with the borrower by a related party (also refer Note 35).

Note 12(i): The Board of Directors of the Company have in their meeting held on 18 May 2017 approved the write off of investments of Rs. 18453.62 lac and advances due of Rs.2093.77 lac from a subsidiary company, SPIC Fertilizers and Chemicals Limited, Mauritius (SFCL Mauritius) as at 31 March 2017, against the provisions made in the earlier years, consequent to the recommendation of the Board of Directors of SFCL Mauritius for its winding up, through written resolutions passed on 16 February 2017, which was also approved by the shareholders of the said subsidiary company. However, there is no impact on this account in the standalone financial statements.

Note 7(ii): The Company has given an undertaking to the lenders of Tuticorin Alkali Chemicals and Fertilizers Limited for non disposal of its shareholdings in the said Company without their prior approval.

Note 8(iii) Consequent to the Scheme of Arrangement (Demerger) between SICAL Logistics Limited and SICAGEN India Limited, sanctioned by the Hon''ble High Court of Madras, by its order dated 20 December 2007, the Company was allotted 5,77,681 Equity Shares of the face value of Rs. 10 each in SICAGEN India Limited.

Note 9(iv) The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in 1994-95 for the manufacture of Polyester Filament Yarn and Purified Terepthalic Acid. The Company had invested Rs.25375.00 lac in the equity share capital, Rs.5.00 lac in 8% redeemable cumulative non convertible preference share capital, Rs.30609.63 lac in Unsecured Zero Interest Bonds redeemable after 12 years from the date of commencement of commercial production. Consequent to the litigation between Chennai Petroleum Corporation Limited (CPCL) and the Company and winding up petitions filed by certain unsecured creditors, the Hon''ble Madras High Court ordered the winding up of the Company on 17 April 2009.

Against the above winding up order, SPIC Petro filed an appeal before the Division Bench of the Hon''ble Madras High Court. The Division Bench of the Hon''ble Madras High Court, dismissed the appeal on 26 April 2010. Meanwhile, ARCIL issued a notice on 19 March 2009, u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), directing SPIC Petro to make payment of the dues to ARCIL within sixty days from the date of the notice. As SPIC Petro could not make the payment, ARCIL took over the possession of the assets of SPIC Petro, under SARFAESI Act on 13 May 2010. Consequent to the above, the nominee directors of SPIC Limited have ceased to be directors of SPIC Petro with effect from 14 May 2010. Hence the Company had lost its control over SPIC Petro and full provision had already been made in the earlier years for the carrying value of investments and also for all other dues from this Company.

Note 10(v) During the year, the Company has invested in 68,700 numbers of Equity shares at Rs.10/- each, at a premium of Rs.1/- per share, aggregating to Rs.7.55 lac in OPG Power Generation Private Limited vide the Share Purchase and Shareholders Agreements entered on 22 December 2016 for purchase and consumption of 10 MW of power at a concessional tariff as applicable under Group Captive Scheme of the Government of India under Electricity Rules, 2005 to achieve savings in cost of power.

Note 11 (i): Consequent to the implementation of SAP during the year company has changed the method of valuation of raw materials from First In First Out (FIFO) method to Weighted Average with effect from 1 October 2016. As a result, closing stock of raw materials is lower by Rs.73.64 lac, cost of materials consumed for the year ended 31 March 2017 is higher by Rs.73.64 lac and change in inventories of finished goods and work-in-progress for the year is higher by Rs.6.28 lac.

Note 12 (ii): An amount of Rs. 6347.00 lac representing certain claims of ILFS against the Company were disputed / challenged before the Courts. In view of the settlement of the said claims by payment of Rs 750.00 lac during the previous year by the Company as agreed through a Memorandum of Compromise, there is no further liability to the Company on this account. The amount of Rs. 750 lac paid is included in Miscelleneous expenses during the previous year.

Note 13: Plant Operation

(i) During the year the Company achieved a production of 5.63 lac MT against the maximum permissible production of 6.20 lac MT. The Company, as Fertilizer Marketing Entity (appointed by Government of India) for marketing imported urea within the country, has handled 1.15 lac MT of urea and sold 1.29 lac MT.

Subsidy for the period 1 April 2016 to 31 March 2017 of Rs. 96773.18 lac has been accounted based on the provisional Retention Price (RP) computed in line with the Government''s policy indicated in the notification dated 17 June 2015, as the final retention price has not been announced by the Department of Fertilizers. The necessary adjustments, if any, will be made when the final retention price is notified by the Department of Fertilizers.

Note 14: Commitments

Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances)

Rs. 1858.88 lac (Previous year Rs. 911.59 lac).

Note 15: Contingent Liabilities

(a) Claims not acknowledged as debts

(ii) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company along with other beneficiaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 41 years. Water Charges were paid to TWAD on the basis of actual receipt by individual industries. The claims including interest made by TWAD for Rs. 2795.28 lac (Previous year Rs. 2543.10 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2017 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(iii) The Company has received a demand from VOC Port Trust (VOCPT) towards increase in rental charges from 1 July 2007 onwards. The amount payable as on 31.03.2017 is Rs. 766.77 lac (from 01.07.2007 to 31.03.2017) (Previous year Rs. 714.43 lac). The Company obtained an injunction from the Madurai Bench of the Hon''ble Madras High Court against the claim made by the VOCPT and the stay has been granted till 10 June 2015. On 23.07.2015, Madurai Bench of the Hon''ble Madras High Court extended the stay until further orders.

(iv) Other claims against the Company - Rs. Nil (Previous year Rs. 1300.00 lac).

(b) Other Bank Guarantees outstanding Rs.31.78 lac (Previous year Rs. 31.78 lac).

(c) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1 April 2001 to 31 March 2017 is Rs. 3188.61 lac (Previous year Rs. 3006.57 lac)

(d) No provision has been considered necessary by the Management for the following disputed Excise duty, Service tax, Sales Tax, Electricity tax and Employees State Insurance demands which are under various stages of appeal proceedings. The Company has been advised that there are reasonable chances of successful outcome of the appeals and hence no provision is considered necessary for these demands.

* Includes disputes relating to the period 1977 to 1992 decided by the ESI Court in favour of the Company against which the Employees State Insurance Corporation has gone on an appeal before the Hon''ble Madras High Court.

Out of the above demand of Rs.16251.02 lac (Previous year Rs. 18331.75 lac), an amount of Rs. 1166.45 lac (Previous year Rs. 918.63 lac) has been deposited under protest / adjusted by relevant authorities.

Note 16: Employee benefit plans

(i) Defined contribution plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. During the year the Company recognized Rs.250.31 lac (Previous year Rs. 233.24 lac) for Provident Fund contributions, Rs. 125.30 lac (Previous year Rs. 106.62 lac) for Superannuation Fund contributions and Rs. 3.87 lac (Previous year Rs. 2.11 lac) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

NOTES

(a) Business segments

The business segment has been considered as the primary segment for disclosure. The products included in each of the business segments are as follows:

(i) Agro inputs - Urea Operations

(ii) Others - Tissue Culture and Seeds

Revenue and expenses, which relates to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under unallocate income or unallocated expenditure respectively.

Unallocated Corporate asset and unallocated Corporate liabilities include the assets and liabilities which are not directly attributable to segments.

(b) Geographical segments

The geographical segments considered for disclosure are as follows:

- Sales within India include Sales to customers located within India

- Sales outside India include sales to customers located outside India.

Note 17 (i): Related party disclosures under Accounting Standard - 18 The list of related parties as identified by the management are as under:

Nature Parties

Subsidiaries 1 SPIC Fertilizers and Chemicals Limited, Mauritius (upto16 February 2017)

Associates 1 Tuticorin Alkali Chemicals and Fertilizers Limited

2 Gold Nest Trading Company Limited

Jointly Controlled entities 1 Tamilnadu Petroproducts Limited

2 National Aromatics and Petrochemicals Corporation Limited

Key Management Personnel of the Company 1 Thiru Ashwin C Muthiah

2 Thiru S R Ramakrishnan

Enterprises owend by / over which Key Management 1 Wilson International Trading Pte Ltd, Singapore

^{Personnel is able to exercise si}g^{nificant influence} 2 Wilson International Trading (India) Private Limited

3 Manali Petrochemicals Limited

4 Greenstar Fertilizers Limited

5 AMI Holdings Private Limited, India

6 Bengal Auto Parts Private Limited

7 Sicagen India Limited

8 SPIC Officers and Staff Welfare Foundation

9 South India Travels Private Limited

10 Lotus Fertilizers Private Limited

11 EDAC Engineering Limited

12 EDAC Staffing Solution Private Limited

13 EDAC Automation Limited

14 Totalcomm Infra Services Private Limited

15 Twinshield Consultants Private Limited

16 AM Corporate Social Responsibility Foundation

17 SPIC Group Companies Employees Welfare Foundation

18 AM International Holdings Pte Ltd, Singapore

19 Firstgen Distribution Private Limited

Note 18 (b): Others

Full particulars of loans given, investment made, guarantees given, security provided together with purpose in terms of Section 186(4) of the Companies Act, 2013. - The details in respect of investment have been provided in Note No.12 of Notes on Accounts. The Company has not given any loan or guarantee.

Details of inter-corporate loans and deposits taken by Companies registered under Section 12 of âSecurities Exchange Board of India Act, 1992â and covered under such class or classes of Companies as may be prescribed under Section 186(6) of the Companies Act, 2013. - Not applicable

Note 19:

(a) Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.

(b) Previous year figures are given in brackets.

(c) The Board of Directors has reviewed the realizable value of all current assets of the Company and has confirmed that all the value of such assets in the ordinary course of business will not be less than the value at which these are recognized in the financial statements. Further, the board, duly taking into account all relevant disclosures made, has approved these financial statement for the year ended 31 March 2017 in its meeting held on 18 May 2017

Mar 31, 2015

Note 1 CORPORATE INFORMATION

Southern Petrochemical Industries Corporation Limited ('the Company'/ 'SPIC'), having its registered office at Chennai is a Public Limited Company, incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange of India. The Company is manufacturing and selling Urea, a Nitrogenous chemical fertilizer and has its manufacturing facility at Tuticorin.

2 (i) Equity shares include :

(a) 1,66,66,666 shares of Rs.10 each fully paid up, issued in the year 2009-10 to Asset Reconstruction Company (India) Ltd., (ARCIL) at an issue price of Rs.18 per share inclusive of a premium of Rs.8 per share in accordance with Issue of Capital and Disclosure Requirements Regulations, 2009 ("SEBI ICDR Regulations") by conversion of secured debts of a sum of Rs. 3000 lac in to equity at the meeting of the Board of Directors held on 30 March 2010.

(b) 32,14,734 shares of Rs 10 each fully paid up, at an issue price of Rs.19 per share inclusive of premium of Rs. 9 per share in accordance with SEBI ICDR Regulations,2009 alloted to secured lenders on conversion of secured debts of Rs. 610.80 lac at the meeting of the Board of Directors held on 8 November 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 6 August 2010 and the shareholders at the AGM held on 21 September 2010.

(c) 1,06,71,001 shares of Rs.10 each fully paid up, at an issue price of Rs. 20 per share inclusive of premium of Rs.10 per share in accordance with SEBI ICDR Regulations, 2009 alloted to ARCIL on conversion of secured debts of Rs. 2134.20 lac at the meeting of the Board of Directors held on 8 December 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 28 October 2010 and the shareholders at the EGM held on 29 November 2010.

(d) 12,631 equity shares of Rs.10 each fully paid up issued to Industrial Investment Bank of India, on preferential basis, at an issue price of Rs.19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs 2.40 lac, at the meeting of the Shareholders' / Investor's Grievance Committe held on 27 April 2012.

(e) 72,631 equity shares of Rs.10 each fully paid up issued to United India Insurance Company Ltd., on preferential basis, at an issue price of Rs.19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs.13.80 lac, at the meeting of the Shareholders' / Investor's Grievance Committe held on 9 November 2012.

(f) 3,72,76,700 equity shares of Rs.10 each fully paid up were issued to AMI Holdings Pvt Ltd, a company belonging to promoter group, on preferential basis, at an issue price of Rs.17.50 per share, which included a premium of Rs. 7.50 per share by way of conversion of 3,72,76,700 warrants, at the meeting of Shareholders' / Investor's Grievance Committe held on 10 January 2013 and 13 March 2013.

(g) 1,70,66,800 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York, Mellon, as depository for the GDRs.

Terms / rights attached to Equity Shares:

The company has only one class of equity shares having a par value of Rs.10 per share. All these shares have the same rights and preferences with respect to payment of dividend, repayment of capital and voting.

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

3 (i) Preference shares:

(a) 14.50% Redeemable cumulative non-convertible preference shares of Rs.300 lac issued on private placement basis, redeemable at par after the expiry of 60 months from the date (s) of allotment, have fallen due for redemption during the year 2001-02.

(b) 11.50% Redeemable cumulative non-convertible preference shares of Rs.850 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2002- 03.

(c) 10.00% Redeemable cumulative non-convertible preference shares of Rs.100 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2003- 04.

Terms / rights attached to Preference Shares

In the event of non-declaration of dividend in respect of any financial year, arrears of dividend will be declared in the subsequent financial years subject to the provisions of the Companies Act and / or any statutory modifications thereto, or re-enactments thereof as may be in force from time to time, prior to payment of dividend on equity shares.

4(i) The prospects for Tissue Culture business has shown significant improvement recently and the Company has decided to focus on the agri divisions operations which has necessitated taking repossession of the related land and building handed over in 2011-12, from the purchaser.

(ii) Depreciation

During the year, pursuant to the notification of Schedule II to the Companies Act, 2013 with effect from 1 April 2014, the Company also revised the estimated useful life of some of its assets to align the useful life with those specified in Schedule II other than the assets pertaining to Tuticorin manufacturing plant for which depreciation has been provided based on the useful life of assets determined by a technical evaluation. Management believes that the revised useful life of the assets reflect the period over which these assets are to be used. Further, assets individually costing Rs. 5000/- or less that were depreciated fully in the year of purchase are now depreciated based on the useful life for the respective category of assets.

5 (i) The Company's investments included Rs.18453.62 lac (Previous year Rs.18453.62 lac) in equity share capital of SPIC Fertilizer and Chemicals Limited, Mauritius (SFCL, Mauritius), which had invested in a wholly owned subsidiary company, viz. SPIC Fertilizers and Chemicals FZE, Dubai (SFC FZE, Dubai) in the earlier years, whose objective was production of ammonia and urea in Jebel Ali Free Zone, Dubai. Since the project did not materialize due to non allocation of gas, the said subsidiary company had commenced activities for dismantling the existing plant and machinery at the project site with a view to relocate the same where assured gas supply could be obtained.

As Jebel Ali Free Zone Authorities (JAFZA) had taken over the assets of SPIC Fertilizers and Chemicals (SFC) FZE, Dubai, the holding company SFCL Mauritius lost control over the subsidiary. Full provision has been made for these investments in earlier years. The Company is considering writing off the investments in SFCL Mauritius and is in the process of getting the approval of the concerned Regulatory Authorities to write off the aforesaid investment in the books of account.

6(i) The Company has given an undertaking to the lenders of Tuticorin Alkali Chemicals and Fertilisers Limited for non disposal of its shareholdings in the said Company without their prior approval.

(ii) Consequent to the Scheme of Arrangement (Demerger) between SICAL Logistics Limited and SICAGEN India Limited, sanctioned by the Hon'ble High Court of Madras, by its order dated 20 December 2007, the Company was allotted 5,77,681 Equity Shares of the face value of Rs.10 each in SICAGEN India Limited.

(iii) The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in 1994-95 for the manufacture of Polyester Filament Yarn and Purified Terepthalic Acid. The Company had invested Rs.25375.00 lac in the equity share capital, Rs.5.00 lac in 8% redeemable cumulative non convertible preference share capital, Rs.30609.63 lac in Unsecured Zero Interest Bonds redeemable after 12 years from the date of commencement of commercial production. Consequent to the litigation between Chennai Petroleum Corporation Limited (CPCL) and the Company and winding up petitions filed by certain unsecured creditors, the Hon'ble Madras High Court ordered the winding up of the Company on 17 April 2009.

Against the above winding up order, SPIC Petro filed an appeal before the Division Bench of the Hon'ble Madras High Court. The Division Bench of the Hon'ble Madras High Court, dismissed the appeal on 26 April 2010. Meanwhile, ARCIL issued a notice on 19 March 2009, u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), directing SPIC Petro to make payment of the dues to ARCIL within sixty days from the date of the notice. As SPIC Petro could not make the payment, ARCIL took over the possession of the assets of SPIC Petro, under SARFAESI Act on 13 May 2010. Consequent to the above, the nominee directors of SPIC Limited have ceased to be directors of SPIC Petro with effect from 14 May 2010. Hence the Company had lost its control over SPIC Petro and full provision had already been made in the earlier years for the carrying value of investments and also for all other dues from this Company.

7 (i) Trade receivables of Rs.1,494.42 lac and Short term loans and advances of Rs.54.64 lac (net of provision of Rs.702.45 lac created in earlier years) represent dues receivable from an associate company. The Company is pursuing the settlement of dues and a Memorandum of Understanding has been executed with the associate company.

Note 8 Plant Operation

(i) Under the Modified New Pricing Scheme III the Department of Fertilizers had issued a directive mandating the Naphtha based fertilizer plants to switch over to gas based operations and that the Naphtha based plants, would be eligible for subsidy only upto 30 September 2014. In view of the above, the Ammonia and Urea Plants were stopped on 1 October 2014 and critical repair works were carried out and completed.

Government of India vide its notification dated 7 January 2015 had permitted the Company to produce Urea using Naphtha as feedstock for a period of 100 days from the date of notification i.e. upto 16 April 2015 and that the subsidy would be paid based on the Retention Price computed on the lower of naphtha or RLNG price. The Ammonia and Urea Plants recommenced operations from 7 January 2015. The Company has since shut down the plant on 17 April 2015 for carrying out maintenance work as may be required during the period of non-operation of the Urea plant.

The Company had filed a writ petition with the Hon'ble Delhi High Court on 20 April 2015. The Company has obtained an Order of the Hon'ble Delhi High Court dated 24 April 2015 which permits the Company to continue to get the subsidy till further orders are passed by the Cabinet Committee of Economic Affairs on the proposal made by the Ministry of Chemicals and Fertilizers recommending payment of subsidy till gas connectivity is established. The company has commenced the urea production on 20 May 2015.

(ii) Subsidy for the period January 2015 to March 2015 of Rs. 36883.95 lac has been accounted based on the provisional Retention Price (RP) computed in line with the Government's policy dated 7 January 2015, as the final retention price has not been announced by the Department of Fertilizers. The necessary adjustments, if any, will be made when the final retention price is notified by the Department of Fertilizers.

Note 9 Commitments

Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 1507.02 lac (Previous year Rs. 1029.66 lac).

Note 10 Contingent Liabilities

(a) Claims not acknowledged as debts

(i) The District Collector, Tuticorin vide his letter dated, 21 August 2009 had demanded Rs. 16873.97 lac (Previous year Rs.16873.97 lac) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008. While raising this demand, the District Collector had ignored the proposal submitted by the Company during 1975 to the State Government seeking assignment of the said land which is still pending. The Company had filed a writ petition challenging the demand before the Hon'ble Madras High Court and the court granted interim stay vide its order dated 21 April 2010 on further proceedings. During November 2010 the District Collector, Tuticorin has filed a counter before Hon'ble Madras High Court praying for the vacation of interim stay and the case is still pending.

(ii) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company alongwith other beneficiaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 39 years. Water Charges were paid to TWAD on the basis of actual receipt by individual industries. The claims including interest made by TWAD for Rs.2272.22 lac (Previous year Rs.1983.91 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2015 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(iii) The Company has received a demand from VOC Port Trust towards increase in rental charges from 1 July 2007 onwards. The amount payable as on 31.03.2015 is Rs.606.16 lac (from 01.07.2007 to 31.03.2015). The Company obtained an injunction from the Madurai Bench of the Hon'ble Madras High Court against the claim made by the VOCPT and the stay has been granted till 10 June 2015.

(iv) The Superintending Engineer, Tamilnadu Generation and Distribution Corporation Limited (TANGEDCO), Cuddalore, vide letter dated 19 April 2012 has claimed Rs. 155.48 lac (Previous year Rs. 155.48 lac) towards outstanding dues relating to the erstwhile Pen-G unit of the Pharmaceutical Division at Cuddalore. The Company has requested TANGEDCO authorities to inform the basis of the above claim for taking further action.

(v) Other claims against the Company, which are being disputed / challenged before the Courts - Rs. 3132.08 lac (Previous year Rs. 3132.08 lac). In respect of the above claims, the Company is of the view that there are reasonable chances of successful outcome of the Appeals / Petitions filed before the Hon'ble Madras High Court / Government Authorities and accordingly no further provision is considered necessary.

(b) Guarantees / Security given to Banks / Financial Institutions on behalf of other companies Rs. 4500 lac (Previous year Rs.4500 lac)

(c) Other Bank Guarantees outstanding Rs. 31.78 lac (Previous year Rs. 31.78 lac).

(d) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1 April 2001 to 31 March 2015 is Rs. 2824.03 lac (Previous year Rs. 2641.99 lac)

* Includes disputes relating to the period 1977 to 1992 decided by the ESI Court in favour of the Company against which the Employees State Insurance Corporation has gone on an appeal before the Hon'ble Madras High Court.

Out of the above demand of Rs.17993.16 lac (Previous year Rs.14653.82 lac), an amount of Rs.918.63 lac (Previous year Rs.902.43 lac) has been deposited under protest / adjusted by relevant authorities.

Note 11 Employee benefit plans i) Defined contribution plans

The Company makes Provident Fund, Superannuation Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. During the year the Company recognized Rs.178.16 lac (Previous year Rs.174.92 lac) for Provident Fund contributions, Rs. 117.25 lac (Previous year Rs.66.67 lac) for Superannuation Fund contributions and Rs.3.44 lac (Previous year Rs. 4.08 lac) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

The discount rate is based on the prevailing market yield of Government of India securities as at the balance sheet date for the estimated term of the obligation.

In the absence of detailed information regarding plan assets which is funded with Life Insurance Corporation of India, the compo- sition of each major category of plan assets, the percentage or amount for each category to the fair value of plan assets has not been disclosed.

Estimate of amount of contribution in the immediate next year is Rs. 42 lac (Previous year is Rs. 56.40 lac)

Note 32 The deferred tax asset arising out of disallowances under section 43B of Income Tax Act 1961 amounting to Rs. 31.71 lac (Previous year Rs. 645.16 lac), de-escalation of subsidy amounting to Rs.7819.92 lac (Previous year Rs.Nil) and VRS compensation amounting to Rs. 81.63 lac (Previous year - Rs.160.34 lac) have not been recognized as a matter of prudence.

The carry forward loss / unabsorbed depreciation for the year has given rise to net deferred tax asset of Rs. 23950.39 lac (Previous year Rs. 30094.15 lac). However, in the absence of virtual certainty that sufficient future taxable income will be available, the said deferred tax asset that can be recognised is restricted to the deferred tax liability of Rs.1546.25 lac (Previous year Rs. 2423.91 lac) as given below. Accordingly, there is no net deferred tax asset or liability as at 31 March 2015 to be accounted for.

Note 12 There is no provision for tax in view of the brought forward losses / unabsorbed depreciation relating to earlier years available for set off while computing income both under the provisions of Sec 115-JB and those other than Sec 115-JB of the Income Tax Act, 1961.

Previous year figures are given in brackets.

NOTES

(a) Business segments

The business segment has been considered as the primary segment for disclosure. The products included in each of the business segments are as follows:

(i) Agro inputs - Urea Operations

(ii) Others - Tissue culture and Seeds

(b) Geographical segments

The geographical segments considered for disclosure are as follows:

- Sales within India include Sales to customers located within India

- Sales outside India include Sales to customers located outside India.

Note 13

(a) Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

(b) The Board of Directors has reviewed the realizable value of all current assets of the Company and has confirmed that all the value of such assets in the ordinary course of business will not be less than the value at which these are recognized in the financial statements. Further, the board, duly taking into account all relevant disclosures made, has approved these financial statements for the year ended 31 March 2015 in its meeting held on 21 May 2015.

Mar 31, 2014

1 Corporate Information

Southern Petrochemical Industries Corporation Limited (the Company), having its registered Office at Chennai is a Public Limited Company, incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange of India. The Company is manufacturing and selling Urea, a Nitrogenous chemical fertilizer and has its manufacturing facility at Tuticorin.

2. Basis of preparation

The abridged financial statements have been prepared, on the basis of the complete set of audited standalone financial statements for the year ended 31 March 2014, (hereinafter referred to as ''Annual Standalone Financial Statements''), in accordance with the requirements of Rule 7A of the Companies (Central Government''s) General Rules and Forms, 1956.

3 Contingent Liabilities

(Refer Note 31 of the Annual Standalone Financial Statements) (a) Claims not acknowledged as debts

(Rupees in lac)

As at As at S. No. Particulars 31 March, 2014 31 March, 2013

1 Tuticorin Lease Rent for 415.19 acre 16873.97 16873.97

2 TWAD Claim 1983.91 1633.70

3 TANGEDCO, Cuddalore 155.48 155.48

4 Other claims Â challenged before various Courts 3132.08 4379.04

5 Taxes, Duties and other demands (under various stages of appeal) 14653.82 14174.76

In respect of the above claims, the Company is of the view that there are reasonable chances of successful outcome of the Appeals / Petitions fi led before the Hon''ble Madras High Court / Government / Statutory Authorities and accordingly no further provision is considered necessary.

(b) Guarantees/Security given to Banks/Financial Institutions on behalf of other companies Rs.4500 lac (Previous year Rs.4500 lac)

(c) Other Bank Guarantees outstanding Rs.31.78 lac (Previous year Rs. 781.78 lac).

(d) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1 April 2001 to 31 March 2014 is Rs.2641.99 lac (Previous year Rs. 2465.04 lac)

4. Taxation

(Refer Note 34 and 35 of the Annual Standalone Financial Statements)

(a) The Company has reviewed its deferred tax assets and liabilities as at 31 March 2014. The Company has carry forward losses and unabsorbed depreciation, which give rise to deferred tax asset of Rs. 30094.15 lac (Previous year Rs. 30068.10 lac) . However in the absence of virtual certainty supported by convincing evidence that suffi cient future taxable income will be available against which such deferred tax assets can be realized, the said deferred tax asset that can be recognized is restricted to the net deferred tax liability of Rs. 1618.41 lac (Previous year Rs. 1848.15 lac) as given below. Accordingly, there is no net deferred tax asset or liability as at 31 March 2014 to be accounted for.

NOTES

(a) Business segments

The business segment has been considered as the primary segment for disclosure. The products included in each of the business segments are as follows:

Continuing

(i) Agro inputs - Urea Operations

(ii) Others - Tissue culture and Seeds

Discontinuing

(i) Bulk drugs and formulations - includes Penicillin - G and formulations

(ii) Others - Enzymes

Revenue and expenses, which relates to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated expenditure net of unallocated income."

Unallocated corporate assets and unallocated corporate liabilities include the assets and liabilities which are not directly attributable to segments.

(b) Geographical segments

The geographical segments considered for disclosure are as follows:

- Sales within India include Sales to customers located within India

- Sales outside India include sales to customers located outside India.

5 (i) Related party disclosures under Accounting Standard - 18

(Refer Note 37 of the Annual Standalone Financial Statements)

The list of related parties as identifi ed by the management are as under:

Nature

Parties

Subsidiaries

1 SPIC Fertilizers and Chemicals Limited, Mauritius

2 SPIC Fertilizers and Chemicals FZE, Dubai

3 SPEL Semiconductor Limited*

4 SPEL America Inc., USA*

Associates

1 Tuticorin Alkali Chemicals and Fertilisers Limited

2 Gold Nest Trading Company Limited

Jointly controlled entities

1 Tamilnadu Petroproducts Limited

2 National Aromatics and Petrochemicals Corporation Limited

Key management personnel of the Company

1 Thiru Ashwin C Muthiah

2 Thiru K K Rajagopalan

Enterprises owned by / over which Key Management Personnel is able to exercise signifi cant infl uence

1 Wilson International Trading Pte Ltd, Singapore

2 Wilson International Trading India Private Limited

3 Manali Petrochemicals Limited

4 Greenstar Fertilizers Limited

5 AMI Holdings Private Limited

6 Bengal Auto Parts Private Limited

7 Sicagen India Limited

8 Wilson Cables Private Limited, Singapore

* Ceased to be subsidiary with effect from 24th March 2014.

6 (a) The operations of the Formulations Industrial Unit at Maraimalai Nagar and Enzyme unit of Pharmaceutical division were discontinued in the previous year, in view of low demand for their products / uneconomical business size and paucity of working capital.

7 (Refer Note 41 of the Annual Standalone Financial Statements)

(a) Previous year''s figures have been regrouped / reclassifi ed wherever necessary to correspond with the current year''s classifi cation / disclosure.

(b) Previous year figures are given in brackets.

(c) The Board of Directors has reviewed the realizable value of all current assets of the Company and has confi rmed that all the value of such assets in the ordinary course of business will not be less than the value at which these are recognized in the financial statements. Further, the board, duly taking into account all relevant disclosures made, has approved these financial statement for the year ended 31 March 2014 in its meeting held on 28 May 2014

(d) Since, the Formulations and Enzymes units were discontinued during 2012 - 13 the figures for the year ended 31 March, 2014 are not comparable with the previous year ended 31 March, 2013.

Mar 31, 2013

1. Corporate Information

Southern Petrochemical Industries Corporation Limited (the Company), having its registered office at Chennai is a Public Limited Company, incorporated under the provisions of trie Companies Act, 1956. Its shares are listed on National Stock Exchange of India. The Company is manufacturing and selling Urea, a Nitrogenous chemical fertilizer and has its manufacturing facility at Tuticorin.

2. Basis of preparation

The abridged financial statements have been prepared, on the basis of the complete set of audited standalone financial statements for the year ended March 31 2013, (hereinafter referred to as ''Annual Standalone Financial Statements''), in accordance with the requirements of Rule 7A of the Companies (Central Government''s) General Rules and Forms, 1956.

3. Significant Accounting Policies

(Refer Note 2 of the Annual Standalone Financial Statements)

4. Increase in Equity Share Capital

(Refer Note 3 of the Annual Standalone Financial Statements)

a) 12,631 equity shares of Rs.10 each fully paid up issued to Industrial Investment Bank of India, on preferential basis, at an issue price of Rs 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs 2.40 lac, at the meeting of the Shareholders'' / Investor''s Grievance Committe held on 27 April 2012.

b) 72,631 equity shares of Rs.10 each fully paid up issued to United India Insurance Company Ltd., on preferential basis, at an issue price of Rs 19 per share, which includes a premium of Rs.9 per share by way of conversion of secured debt of Rs 13.80 lac, at the meeting of the Shareholders'' / Investor''s Grievance Committe held on 9 November 2012.

c) 3,72,76,700 equity shares of Rs.10 each fully paid up issued to AMI Holdings Pvt Ltd, a company belonging to promoter group, on preferential basis, at an issue price of Rs.17.50 per share, which includes a premium of Rs.7.50 per share by way of conversion of 3,72,76,700 warrants (which were issued during the current financial year), at the meetings of Shareholders'' / Investor''s Grievance Committe held on 10 January 2013 and 13 March 2013.

5. Settlement of dues to Creditors

(Refer Note 5 of the Annual Standalone Financial Statements)

a) As the Corporate Debt Restructuring (CDR) Package dated 19 March 2003 did not yield the desired results, secured lenders who held approximately 85.56% in value, assigned the financial assistance granted by them along with the attendant security interests in favour of Asset Reconstruction Company (India) Limited (ARCIL) under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).

ARCIL and other Financial Institutions have approved the rework package dated 13 March 2010 through Corporate Debt Restructuring (CDR) mechanism (read with Term Sheet of ARCIL dated -28 March 2010 arid Addendum dated 29 June 2011 to the Term Sheet). As the Company could not meet certain repayment obligations as per the rework package, the Corporate Debt Restructuring Empowered Group (CDREG) vide its letters dated 26 July 2011 and 5 September 2011 approved modifications and revised the rework package, stipulating certain changes in the repayment schedule. The total payment to ARCIL and other secured lenders as per total revised working upto 31 March 2013 amounted to Rs.130007.17 lac (Previous year Rs.126377.17 lac) including a sum of Rs.3630 lac (Previous Year Rs.43822.02 lac) paid during the year. ARCIL and certain other secured lenders have converted upto 31 March 2013 part of the debts amounting to Rs.5761.20 lac (Previous year Rs.5745 lac) into equity as stipulated in the CDR rework package, including Rs.16.20 lac (Previous year Rs. NIL) converted during the year. They have also converted part of the debt amounting to Rs. Nil (Previous year Rs.203.18 lac) into non-convertible debentures, out of which debentures amounting to Rs.145.13 lac (Previous year Rs.29.03 lac) have been redeemed including a sum of Rs.116.10 lac (Previous year Rs.29.03 lac) redeemed during the year.

b) The Company filed a Scheme of Compromise and Arrangement with certain creditors under Section 391 and other relevant provisions of the Companies Act, 1956, before the Hon''ble Madras High Court on 14 December 2011 for settlement of their dues. Pursuant to the directions of the Hon''ble Court, the meeting of the creditors of the Company was held on 24 February 2012 at Chennai. The Scheme was approved by the requisite majority and thereafter sanctioned by the Hon''ble Court vide its Order dated 16 August 2012. The effective date of the Scheme was 28 September 2012, being the date on which the Court Order was filed with the Registrar of Companies, Tamilnadu at Chennai.

As per the Court sanctioned Scheme, the Company offered the following settlement Options to its creditors and the settlements were to be made after the Option expiry date :

Option 1 : 60% of settlement liability payable in 46 quarterly instalments.

Option 2 : 22% of the settlement liability payable within 3 years.

Option 3 : An one time settlement equivalent to 18.15% of the settlement liability payable within 45 days. The creditor shall be entitled to pro-rata payment of an additional 1.5% per annum of the settlement liability calculated in days if the settlement liability is credited to the creditor account after 30 June 2012.

While 23% of the creditors had opted for Option 1, 77% of the creditors opted for Option 3. Based on the Options exercised, the first instalment and the final payment to those creditors who had exercised Option 1 and 3 respectively amounting to Rs.13276.01 lac were paid before the due date for payment (i.e.) 6 January 2013. On account of the above settlements/ payments, the excess liability of Rs.115775 lac including interest has been written back as an Exceptional Item during the year.

The creditor balances other than term loan are reflected under long term liabilities and trade payables based on repayment schedule specified in the scheme.

6 Investment

(Refer Note 12 of the Annual Standalone Financial Statements)

The Company had paid a capital advance of Rs.2091.04 lac (Previous year Rs.2091.04 lac) to MCC Finance Limited (now known as Mercantile Ventures Limited) in the earlier years, for purchase of certain immovable properties. Consequent to the withdrawal of the pending litigation before the Hon''ble Madras High Court, full provision was made in the accounts during the 1st quarter of the previous year. MCC Finance Ltd., filed a Scheme of Arrangement with its creditors under section 391 and other relevant provisions of the Companies Act, 1956 before the Hon''ble Madras High Court which was sanctioned by the Hon''ble Court vide its Order dt. 18 October 2012.

As per the sanctioned Scheme and the option exercised by the Company, MCC Finance Ltd., has allotted equity shares for a value of Rs.922 lac (92,20,000 equity shares with a face value of Rs.10 each with a premium of Rs.15/-) to the Company against the outstanding capital advance of Rs.2091.04 lac and the balance of Rs. 1169.04 lac was charged off to the Statement of Profit and Loss. Consequently provision of Rs. 922 lac already made has been written back during the year.

7 Discontinuing Operations -

(Refer Note 28 of the Annual Standalone Financial Statements)

a) The operations of the Formulations Industrial Unit at Maraimalai Nagar were discontinued with effect from 2 April 2012 due to low demand for its products in the domestic and export markets and uncertain power situation. Certain assets relating to the above unit were disposed off during the year and the loss of Rs. 11.28 lac has been included in "(Loss)/Gain on disposal of assets".

b) The operations of Enzyme Unit of the Pharmaceutical Division were discontinued during the year in view of its uneconomical business size, constraints in fund infusion/restart-up of the operations after being relocated from various places and paucity of working capital. Certain assets of the above unit were sold on 18 December 2012 based on an Asset Sale Agreement and the loss arising out of such sale amounting to Rs.87.40 lac is included in "(Loss)/Gain on disposal of assets".

8. Plant Operation

(Refer Note 29 of the Annual Standalone Financial Statements)

a) Due to failure of Southwest monsoon, there was an acute water scarcity in the Southern parts of Tamilnadu. Tamilnadu Water Supply and Drainage Board (TWAD) had discontinued supply of water to the Tuticorin Plant due to which production of Urea was stopped effective 12 August 2012. The production was resumed on 4 October 2012 after commencement of partial supplies by TWAD.

b) There has been delay in the disbursement of fertilizer subsidy by the Department of Fertilizers, Government of India, during February and March 2013, due to which the payments to Indian Oil Corporation (IOC) for raw material supplies could not be made before the stipulated due dates, resulting in shutdown of the Nitrogenous plants with effect from 2 March 2013 to till date. The Company is in discussion with the Dept. of Fertilizers, Govt, of India, for the renewal of fertilizer subsidy on a priority basis and also renegotiating with IOC for better credit terms for raw material supplies. The Company is hopeful of recommencing the operations of the Nitrogenous plants at Tuticorin after the resumption of raw material supplies by IOC.

9 Capital Commitments

(Refer Note 30 of the Annual Standalone Financial Statements)

a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 1544.20 lac (Previous year Rs. 362.90 lac).

b) Confirmed sales commitments to be fulfilled within one year as on 31 March 2013 is Rs. Nil (Previous year Rs.1800 lac).

10 Contingent Liabilities

(Refer Note 31 of the Annual Standalone Financial Statements)

(a) Claims not acknowledged as debts: (Rupees in lac)

As at As at S. No.Particulars 31 March 2013 31 March 2012

1 Tuticorin Lease Rent for 415.19 acre 16873.97 16873.97

2 TWAD claim 1633.70 1242.70

3 TANGEDCO, Cuddalore 155.48 155.48

4 Other claims - challenged before various Courts 4379.04 4304.95

5 Taxes, Duties and other demands (under various stages of appeal) 14174.76 13448.19

In respect of the above claims, the Company is of the view that there are reasonable chances of successful outcome of the Appeals / Petitions filed before the Hon''ble Madras High Court/Government/Statutory Authorities and accordingly no further provision is considered necessary.

(b) Guarantees/Security given to Banks/Financial Institutions on behalf of other companies Rs. 4500 lac (Previous year Rs. 4500 lac)

(c) Other Bank Guarantees outstanding Rs.781.78 lac (Previous year Rs. 781.78 lac).

(d) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1 April 2001 to 31 March 2013 is Rs.2465.04 lac (Previous year Rs. 2288.09 lac)

11 Taxation

(Refer Note 34 and 35 of the Annual Standalone Financial Statements)

a) The Company has reviewed its deferred tax assets and liabilities as at 31 March 2013. The Company has carry forward losses and unabsorbed depreciation, which give rise to deferred tax asset of Rs.30068.10 lac (Previous Year Rs.28458.84 lac). However in the absence of virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized, the said deferred tax asset that can be recognized is restricted to the net deferred tax liability of Rs. 1848.15 lac (Previous Year Rs. 615.57 lac) as given below. Accordingly, there is no net deferred tax asset or liability as at 31 March 2013 to be accounted for.

NOTES

(a) Business segments

The business segment has been considered as the primary segment for disclosure. The products included in each of the business segments are as follows:

Continuing

(i) Agro inputs - Urea Operations (ii) Others - Tissue culture and Seeds

Discontinuing

(i) Bulk drugs and formulations - includes Penicillin - G and formulations (ii) Others - Enzymes

Revenue and expenses, which relates to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated expenditure net of unallocated income."

Unallocated corporate assets and unallocated corporate liabilities include the assets and liabilities which are not directly attributable to segments.

(b) Geographical segments

The geographical segments considered for disclosure are as follows:

- Sales within India include sales to customers located within India

- Sales outside India include sales to customers located outside India.

12 (i) Related party disclosures under Accounting Standard -18

(Refer Note 37 of the Annual Standalone Financial Statements)

Mar 31, 2012

Note 1 CORPORATE INFORMATION

Southern Petrochemical Industries Corporation Limited (the Company), having its registered office at Chennai is a Public Limited Company, incorporated under the provisions of Companies Act, 1956. Its shares are listed on National Stock Exchange of India. The Company is manufacturing and selling Urea, a Nitrogenous chemical fertiliser and has its manufacturing facility at Tuticorin.

2 (i) Equity shares include

(a) 1,66,66,666 shares of Rs.10 each fully paid up, issued in the year 2009-10 to Asset Reconstruction Company (India) Ltd., (ARCIL) at an issue price of Rs.18 per share inclusive of a premium of Rs.8 per share in accordance with SEBI ICDR Regulations, 2009 by conversion of secured debts of a sum of Rs. 3000 lac in to equity at the meeting of the Board of Directors held on 30 March 2010.

(b) 65,58,676 shares issued in the year 2009-10 on conversion of same number of Fully Compulsorily Convertible Preference (FCCP) shares of the face value of Rs.10 each fully paid up at a premium of Rs.8 per share at the meeting of the Board of Directors held on 31 March 2010. The equity shares acquired by conversion shall be locked-in for a period of 3 years from the date of allotment, reduced to the extent of the holding period of Preferential Shares.

(c) 2,12,19,101 shares issued in the year 2010-11 on conversion of same number of FCCP shares of the face value of Rs.10 each fully paid up at a premium of Rs. 8 per share at the meeting of the Board of Directors held on 12 October 2010 after obtaining the exemption from SEBI under SEBI Takeover Code, vide its order dated 28 September 2010, from the requirement of making of a public announcement. The equity shares acquired by conversion shall be locked-in for a period of 3 years from the date of allotment, reduced to the extent of the holding period of Preferential Shares.

(d) 32,14,734 shares of Rs 10 each fully paid up, at an issue price of Rs 19 per share inclusive of premium of Rs 9 per share in accordance with SEBI ICDR Regulations,2009 alloted to secured lenders on conversion of secured debts of Rs. 610.80 lac at the meeting of the Board of Directors held on 8 November 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 6 August 2010 and the shareholders at the AGM held on 21 September 2010.

(e) 1,06,71,001 shares of Rs 10 each fully paid up, at an issue price of Rs 20 per share inclusive of premium of Rs 10 per share in accordance with SEBI ICDR Regulations, 2009 alloted to ARCIL on conversion of secured debts of Rs. 2134.20 lac at the meeting of the Board of Directors held on 8 December 2010. The above allotment is in pursuant to the approval of the Board at its meeting held on 28 October 2010 and the shareholders at the EGM held on 29 November 2010.

(f) The Company, at the meeting of the Committee of the Board of Directors held on 27 April 2012, has allotted 12,631 equity shares of Rs 10 each to Industrial Investment Bank of India at an issue price of Rs 19 per share, which includes a premium of Rs.9 per share, by way of conversion of secured debt of a sum of Rs 2.40 lac. This is further to the approval of the Members at the Annual General Meeting held on 16 November 2011 for allotment and issue of the said shares and on obtaining 'in-principle' approval from National Stock Exchange of India on 25 April 2012.

(g) 1,71,83,850 equity shares were issued against the Global Depository Receipts (GDRs) and is held by The Bank of New York, Mellon, as depository for the GDRs.

Terms/rights attached to Equity Shares:

The company has only one class of equity shares having a par value of Rs. 10 per share. All these shares have the same rights and preferences with respect to payment of dividend, repayment of capital and voting.

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

2 (ii) Preference shares:

(a) 14.50% Redeemable cumulative non-convertible preference shares of Rs.300 lac issued on private placement basis, redeemable at par after the expiry of 60 months from the date (s) of allotment, have fallen due for redemption during the year 2001-02.

(b) 11.50% Redeemable cumulative non-convertible preference shares of Rs.850 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2002-03.

(c) 10.00% Redeemable cumulative non-convertible preference shares of Rs.100 lac issued on private placement basis, redeemable at par after the expiry of 36 months from the date (s) of allotment, have fallen due for redemption during the year 2003-04.

(d) Pursuant to the approval of the Board at its meeting held on 25 January 2010 and the shareholders at the EGM held on 22 February 2010, M/s.FICON Holdings Ltd., Mauritius (FICON) a promoter group entity remitted Rs.5000 lac and was allotted 2,77,77,777 FCCP shares of Rs.18 each with each FCCP share compulsorily and mandatorily convertible in multiple tranche to one equity share of Rs.10 each, fully paid up at an issue price of Rs.18 which is inclusive of a premium of Rs.8 per share, in accordance with the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009 ("SEBI ICDR Regulations"). Out of this 65,58,676 FCCP shares were converted in to Equity shares of face value Rs. 10 each fully paid up at a premium of Rs. 8 per share on 31 March 2010. During 2010-11, the balance of 2,12,19,101 FCCP shares were converted into equity shares of Rs. 10 each at a premium of Rs. 8 per share. (Refer note 3(iii)(b) and 3(iii)(c) above)

(e) In the event of non-declaration of dividend in respect of any fi nancial year, arrears of dividend will be declared in the subsequent financial years subject to the provisions of the Companies Act, 1956 and / or any statutory modifications thereto, or re-enactments thereof as may be in force from time to time, prior to payment of dividend on equity shares.

3.(i) In view of the loss for the year, the Company has not created the Debenture Redemption Reserve of Rs 50.79 lac (Previous year Rs. Nil) as required under section 117C of the Companies Act, 1956, read with General Circular No: 9/2002 dated 18 April 2002 issued by the Department of Corporate Affairs. The Company will create the Debenture Redemption Reserve, out of profits, in the future years.

* Includes debentures assigned to Asset Reconstruction Company (India) Limited (ARCIL) Rs. 5265.96 lac (Previous year Rs. 15567.00 lac)

** Includes term loans assigned to ARCIL Rs. 50317.38 lac (Previous year Rs. 47391.32 lac)

4 (i) Security

The secured long term borrowings as above are secured by a pari-passu charge, by way of joint equitable mortgage, on immovable and movable properties of the Company, both present and future, hypothecation of inventories and all present and future book debts of the Company including Government subsidies, pledge of Company's investments in equity of other company identified for divestment, Personal Guarantee of a Director and a former Director and by pledge of shareholding of the private promoters in the Company.

4 (ii) Details of Term loans

As per the rework package of CDR dated 13 March 2010 and modifications through letters dated 26 July 2011 and 5 September 2011 (read with Term Sheet of ARCIL dated 28 March 2010 and addendum to Term sheet of ARCIL dated 29 June 2011) the repayment schedule is for the total secured loans including Series VII and Series XIII debentures and accordingly these debentures do not have a separate redemption schedule. Series XIV, XV and XVI privately placed non-convertible debentures are to be redeemed in seven equal quarterly instalments commencing from 31 March 2012. Of these the first instalment had been redeemed by 31 March 2012.

4 (iii) Consequent to the implementation of Corporate Debt Restructuring (CDR) Package dated 19 March 2003, the Company had availed interest relief from various banks and financial institutions amounting to Rs. 4110.36 lac (Previous year Rs. 4110.36 lac) for the year 2002-03 and therefore accrued the interest liability at the reduced rates in the subsequent years up to 31 March 2008.

4.(iv) As the Corporate Debt Restructuring (CDR) Package referred above did not yield the desired results, the secured lenders preferred to assign their debts in favour of Asset Reconstruction Company (India) Limited (ARCIL). As on 31 March 2012, secured lenders who held approximately 85.56% in value, assigned the financial assistance granted by them along with the attendant security interests in favour of ARCIL under the provisions of Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act).

ARCIL and other financial institutions have approved the rework package dated 13 March 2010 through Corporate Debt Restructuring (CDR) mechanism (read with Term Sheet of ARCIL dated 28 March 2010 and Addendum dated 29 June 2011 to the Term Sheet) on successful implementation of which the Company would be eligible for substantial reduction in debts and interest accrued thereon. As the Company could not meet certain repayment obligations as per the rework package, the Corporate Debt Restructuring Empowered Group (CDREG) vide its letters dated 26 July 2011 and 5 September 2011 approved modifications and revised the rework package, stipulating certain changes in the repayment schedule. The total payment to ARCIL and other secured lenders upto 31 March 2012 amounted to Rs.126377.17 lac (Previous year Rs. 82555.15 lac) including a sum of Rs.43822.02 lac (Previous year Rs.46555.68 lac) paid during the year. ARCIL and certain other secured lenders have converted upto 31 March 2012, part of the debts amounting to Rs.5745 lac (Previous year Rs. 5745 lac) into equity as stipulated in the CDR rework package, including Rs.Nil (Previous year Rs. 2745 lac) converted during the year. They have also converted part of the debt amounting to Rs 203.18 lac (Previous year Rs. Nil) into non-convertible debentures, out of which debentures amounting to Rs. 29.03 lac have been redeemed during the year.

In line with the terms of the revised rework package, the Company monetized certain other assets and the proceeds alongwith internal accruals were utilized for repayment of its dues to ARCIL and other secured lenders. The Company has paid interest of Rs 3446.15 lac (Previous year Rs. Nil) on account of delay in settlement of dues to ARCIL and other secured lenders. As per the terms of the rework package, in the event, the Company is unable to meet the payment terms, the package shall be withdrawn. Pending settlement of the balance dues, no credit has been taken for expected relief in loan/interest liabilities.

4.(vi) During November 2011, the Financial Institution which had extended assistance against the land and building of Agribusiness Division exercised its right towards settlement of the loan. Consequently the Company executed a Power of Attorney (POA), in favour of the lender, duly registered, for disposal of the aforesaid assets against which the lender has issued a No Due Certificate. Hence the loan liability net of carrying value of the assets taken over is written back and disclosed as an exceptional item. The said institution is not a party to the CDR rework package dated 13 March 2010.

Notes:

# Includes Rs. Nil (Previous year Rs. 756.56 lac) being the cost of building on lease hold land.

$ Includes R & D Assets Nil (Previous year Rs. 339.03 lac).

* In pursuance of Accounting Standard 28 - Impairment of Assets (AS - 28) notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006 and with the relevant provisions of the Companies Act, 1956, the Company has reviewed its carrying cost of assets viz., buildings, plant and machinery, furniture and fittings and vehicles relating to the Formulation and Enzyme Units of the Pharmaceutical Division and has provided for impairment loss estimated at Rs.308.93 lac which is disclosed in Note 29(v).

The impairment to the tune of Rs. 920.02 lac as on 31 March 2011 provided on Pen-G assets at Cuddalore has been reversed during the current year consequent to the sale of those assets by ARCIL.

Capital Work-in-progress of Rs. 122.77 lac is net of provision of Rs.95.60 lac as disclosed in Note 29 (v).

5.(i) The Company's investments included Rs. 18453.62 lac (Previous year Rs.18453.62 lac) in equity share capital of SPIC Fertilizers and Chemicals Limited, Mauritius, which has invested in a wholly owned subsidiary company, viz. SPIC Fertilizers and Chemicals FZE, Dubai(SFC FZE, Dubai) in the earlier years, whose objective was production of ammonia and urea in Jebel Ali Free Zone, Dubai. Since the project did not materialize due to non allocation of gas, the said subsidiary company had commenced activities for dismantling the existing plant and machinery at the project site with a view to relocate the same where assured gas supply could be obtained.

Meanwhile, the Jebel Ali Free Zone Authorities (JAFZA), Dubai had issued a notice on 24 March 2010 to SFC FZE, Dubai, for vacation of site and surrender of materials and machineries on site to JAFZA towards land lease arrears amounting to Rs.2483.50 lac (equivalent to 20334918.75 AED) due to them failing which they will initiate legal action against the said company. SFC FZE, Dubai, has conveyed its consent to the above authorities to avoid proposed legal action and consequent damages. As the project remained a non-starter, full provision has already been made by the Company for the carrying value of investment in SPIC Fertilizers and Chemicals Limited, Mauritius, along with other dues from it. The Company is in the process of getting the approval of the concerned Regulatory Authorities to write off the aforesaid investment in the books of account.

5.(ii) The Company has given an undertaking to the lenders of Tuticorin Alkali Chemicals and Fertilisers Limited for non disposal of its shareholdings in the said Company without their prior approval.

5.(iii) Consequent to the Scheme of Arrangement (Demerger) between SICAL Logistics Limited and SICAGEN India Limited, sanctioned by the Hon'ble High Court of Madras, by its order dated 20 December 2007, the Company was alloted 5,77,681 Equity Shares of the face value of Rs. 10 each in SICAGEN India Limited.

5.(iv) The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in 1994-95 for the manufacture of Polyester Filament Yarn (Capacity: 80000 TPA) and Purified Terepthalic Acid (Capacity: 315000 TPA). The Company had invested Rs.25375.00 lac in the equity share capital, Rs.5.00 lac in 8% redeemable cumulative non convertible preference share capital, Rs.30609.63 lac in Unsecured Zero Interest Bonds redeemable after 12 years from the date of commencement of commercial production or repayment of all the term loans to the lenders, whichever is earlier. In view of the pending litigation between Chennai Petroleum Corporation Limited (CPCL) and the Company and the consequent interim injunction granted by the Hon'ble Madras High Court in 1997 to stop implementation of activities, there has been a suspension of activities.

While SPIC Petro was pursuing its revival efforts, the Hon'ble Single Judge of the Hon'ble Madras High Court ordered the winding up of the company on 17 April 2009 and appointed the Official Liquidator to take charge of all the properties and effects of the company, at the time of disposing the winding up petitions filed by certain unsecured creditors.

Against the above winding up order, SPIC Petro filed an appeal and obtained an interim stay from the Division Bench of the Hon'ble Madras High Court on 5 May 2009. After several hearings, the Division Bench vide its order dated 16 December 2009 directed SPIC Petro to pay an amount of Rs.110 lac as part-payment to certain unsecured creditors who have initiated the winding up proceedings before the court, on or before 31 March 2010. Since SPIC Petro was unable to make the above payment on or before 31 March 2010, the Division Bench of the Hon'ble Madras High Court, dismissed the appeal on 26 April 2010. Meanwhile, ARCIL issued a notice on 19 March 2009, u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), directing SPIC Petro to make payment of the dues to ARCIL within sixty days from the date of the notice. As SPIC Petro could not make the payment, ARCIL took over the possession of the assets of SPIC Petro, under SARFAESI Act on 13 May 2010.

However, the Off cial Liquidator appointed by the Hon'ble Madras High Court has taken over possession of the assets and effects of SPIC Petro on 14 May 2010, in accordance with the order issued by the Division Bench of the Hon'ble Madras High Court on 26 April 2010. Consequent to the above, the nominee directors of SPIC Limited have ceased to be directors of SPIC Petro with effect from 14 May 2010. On an appeal preferred by ARCIL, the Hon'ble Madras High Court vide its order dated 20 December 2010 directed the Official Liquidator to hand back the possession of the above mentioned assets to ARCIL, pursuant to which ARCIL took repossession of the same on 4 January 2011.

In view of the above developments, the Company had lost its control over SPIC Petro and hence it ceased to be a subsidiary of the Company. However, full provision has already been made in the earlier years for the carrying value of investments and also for all other dues from this company.

6 (i) Capital advances include a sum of Rs.2091.04 lac (Previous year Rs.2091.04 lac) being advances paid to MCC Finance Limited for purchase of certain immovable properties. The Company entered into sale agreements for these properties with MCC Finance Limited and the execution and registration of sale deeds are pending. The Administrator/Provisional Liquidator of MCC Finance Limited has filed a Petition before the Company Court at Chennai seeking a direction that the sale agreements entered into between the Company and MCC Finance Limited be declared null and void. The said Petition was allowed by the Single Judge on 18 June 2003. The Company fi led an appeal against the Order before the Division Bench of the Hon'ble Madras High Court. The Division Bench admitted the appeal and ordered status quo be maintained, pending disposal of the appeal. However full provision was made in the accounts during 1st quarter of the current year and the pending appeal was withdrawn by the Company during September 2011. MCC Finance Limited has since filed a Scheme of Arrangement with its creditors under section 391 of the Companies Act, 1956 before the Hon'ble Madras High Court which is pending approval.

6 (ii) The loans & advances include certain overdue and unconfirmed balances. However, in the opinion of the Management these current assets would in the ordinary course of business realize the value as stated in the accounts.

7 (i) In view of the Company's inability to restart the Pen-G operation due to unremunerative market on account of Chinese imports and also considering the non-viability of operations relating to R&D and Active Pharmaceutical Ingredients (API) of the Pharma unit, Asset Reconstruction Company (India) Ltd., (ARCIL) vide notice dated 17 May 2011 intimated that they had taken over the possession of immovable properties of the Pen-G unit at Cuddalore. Consequently the operations of Pen-G, R&D and API of the Pharma unit were closed by the Company. ARCIL sold the assets relating to Pen-G unit during October 2011 and appropriated the sale proceeds against the outstanding dues payable by the Company to ARCIL and other secured lenders.

7 (ii) Pursuant to the approval of CDR Empowered Group and the consent of the Shareholders obtained through postal ballot, the SPIC Maintenance Organisation (SMO) Division and Phosphatics Business of the Company were sold as going concern on a slump sale basis during September 2011 and October 2011 respectively. Pending completion of the statutory formalities, production and sale of Phosphatic fertilisers were carried out by the Company on behalf of the buyer for the period from 19 to 24 October 2011. Consequently, the sale of Rs. 1355.28 lac is included in the net sales / income from operations of the current year and the resultant excess of sale proceeds over the expenses has been transferred to the buyer. Claims, if any, which are non current in nature arising out of the aforesaid discontinued business operations prior to the date of their transfer will be discharged by the Company as per the terms of the Business Transfer Agreements executed with the buyers.

7 (iii) The operations of the Formulations Industrial Unit at Maraimalai Nagar were discontinued with effect from 2 April 2012 due to low demand for its products in the domestic and export markets and uncertain power situation.

7 (iv) The operations of Enzyme Unit of the Pharmaceutical Division are being discontinued by the Company in view of its uneconomical business size, constraints in fund infusion/restart-up of the operations after being relocated from various places and paucity of working capital.

7 (v) In pursuance of Accounting Standard 28 - Impairment of Assets (AS - 28) notified by the Central Government of India under the Companies (Accounting Standards) Rules, 2006 and with the relevant provisions of the Companies Act, 1956, the Company has reviewed its carrying cost of assets viz., buildings, plant and machinery, furniture and fittings, and vehicles including Capital Work-in-Progress of Rs. 95.60 lac relating to the Formulation and Enzyme Units of the Pharmaceutical Division and has provided for impairment loss estimated at Rs.404.53 lac which is included in "Exceptional Item".

7 (vi) The Government of India introduced Nutrient Based Subsidy Scheme (NBS) effective from 1 April 2010 for Phosphatic Fertilizers and as per this policy, the concession payable is fixed for the entire financial year with open Maximum Retail Price. Concession income has been recognised in the books of account based on the applicable guidelines under NBS for the current year till the date of disposal of the Phosphatics Business.

7 (v) (a) Information in accordance with the requirements of the revised Accounting Standard - 7 on Construction Contracts notified by the Central Government of India under Companies (Accounting Standard) Rules, 2006 and with the relevant provisions of the Companies Act, 1956 is as below:

*Refer Note 29 (ii).

(b) Research and Development expenses incurred on revenue account is Rs.Nil (Previous year Rs. 123.94 lac)

Note 8 Going Concern

In spite of erosion of net-worth and discontinuation of certain operations as referred in Note 29, the financial statements of the Company have been prepared on a going concern basis, in view of the following:

8(i) The Company recommenced the manufacturing operations of Urea, being its core business, from 9 October 2010 and produced 297650 MT of Urea for the year 2010-11. The Company has also continuously operated its Urea plant at 100% reassessed capacity level and achieved a production of 620407 MT for the current year, which has resulted in significant improvement in the profi tability. Considering the Supply Agreement dated 24 April 2010 with Indian Oil Corporation Limited (IOCL) for the supply of raw materials, the Company is confident of sustaining the present level of Urea operations in future.

8(ii) The revised rework package approved under Corporate Debt Restructuring (CDR) mechanism, as referred in Note 5 (v) envisages bringing down the debts and consequently improving the net-worth.

8(iii) The Company has discontinued certain business operations with an objective to monetize the underlying assets of such business units as referred in Note 29 and the proceeds alongwith internal accruals were utilized for repayment of dues to ARCIL and other secured lenders, which has resulted in substantial reduction of debt level.

8(iv) The Company has filed a Scheme of Arrangement with certain creditors under section 391 of the Companies Act, 1956 on 14 December 2011 before the Hon'ble Madras High Court and pursuant to the directions of the Hon'ble Court, the meeting of the creditors of the Company was held on 24 February 2012 at Chennai. The Scheme was approved by the requisite majority and thereafter the Company has fi led a Company Petition before the Hon'ble Madras High Court for the sanction of the Scheme which is pending.

Note 9 Commitments

(a) Capital Commitments:

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 362.90 lac (Previous year Rs. 84.50 lac).

(b) Confirmed sales commitments to be fulfilled within one year as on 31 March 2012 is Rs.1800 lac (Previous year Nil).

Note 10 Contingent Liabilities

(a) Claims not acknowledged as debts :

(i) The District Collector, Tuticorin vide his letter dated, 21 August 2009 had demanded Rs. 16873.97 lac (Previous year Rs.16873.97 lac) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008. While raising this demand, the District Collector had ignored the proposal submitted by the Company during 1975 to the State Government seeking assignment of the said land which is still pending. The Company had fi led a writ petition challenging the demand before the Hon'ble Madras High Court and the court granted interim stay vide its order dated 21 April 2010 on further proceedings. During November 2010 the District Collector, Tuticorin has fi led a counter before Hon'ble Madras High Court praying for the vacation of interim stay and the case is still pending.

(ii) The Phosphate Chemical Export Association Inc. USA (Phoschem) filed a suit before the Hon'ble Madras High Court for recovery of US$11.52 million (INR equivalent 5893.23 lac) during March 2006 towards supply of raw material to the Company. The court passed an interim decree in favour of Phoschem for US$8.76 million (INR equivalent 3911.34 lac) on 5 March 2007 against which the Company fi led a Review Petition on 21 March 2007 on the ground that the Hon'ble High Court has not considered the realization of US$6.31 million by Phoschem from the Insurance company. The Review Petition is still pending before the Hon'ble High Court. The Company had already made a provision of Rs.4436.48 lac (Previous year Rs. 3872.20 lac) towards this claim and the balance claim not acknowledged by the Company is Rs.1414.11 lac (Previous year Rs. 1234.25 lac). This claim is restated at the exchange rate as on the Balance Sheet date.

(iii) Groupe Chimique Tunisian SA (GCT) initiated arbitration proceedings against the Company for non payment of US$ 15.02 million together with interest towards supply of Phosphoric Acid in the earlier years against which the Arbitral Tribunal passed an award on 9 September 2009 directing the Company to pay a sum of Rs.7300 lac to GCT towards principal and Rs.2500 lac towards interest. The Company fi led a petition before the Hon'ble Madras High Court on 7 December 2009 for setting aside the award and the Court ordered notice to GCT on 23 December 2009. The matter is pending before the Hon'ble Madras High Court. As the Company had already made a provision of Rs.7522.26 lac (Previous year Rs.6565.52 lac), the remaining claim not acknowledged by the Company on this account is Rs.2277.74 lac (Previous year Rs.3234.48 lac).

(iv) Tamilnadu Water Supply And Drainage Board (TWAD) has claimed payments for the period during which the Nitrogenous plants were not in operation, on the basis of 50% allotted quantity of water. The Company along with other benefi ciaries has been enjoying this facility since inception of the 20 MGD Scheme for the last 36 years. Water Charges were paid to TWAD on the basis of actual receipt by individual industries. The claims made by TWAD for Rs.726.52 lac (Previous year Rs.692.79 lac) is not acknowledged as debt, as this differential value from April 2009 to March 2012 is not supported by any Government Order and also the other beneficiaries are objecting to such claims of TWAD.

(v) The Superintending Engineer, Tamilnadu Generation and Distribution Corporation Limited (TANGEDCO), Cuddalore, vide letter dated 19 April 2012 has claimed Rs. 155.48 lac towards outstanding dues relating to the Pen-G unit of the Pharmaceutical Division at Cuddalore. The Company is in the process of ascertaining the basis of the above claim from the authorities concerned for taking appropriate action.

(vi) Other claims against the Company, which are being disputed/challenged before the Courts - Rs.4304.95 lac (Previous year Rs. 4155.82 lac).

In respect of the above claims, the Company is of the view that there are reasonable chances of successful outcome of the Appeals / Petitions fi led before the Hon'ble Madras High Court/Government Authorities and accordingly no further provision is considered necessary.

(b) Guarantees/Security given to Banks/Financial Institutions on behalf of other companies Rs.4500 lac (Previous year Rs.4500 lac)

(c) Other Bank Guarantees outstanding Rs.781.78 lac (Previous year Rs. 781.78 lac)

(d) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1 April 2001 to 31 March 2012 is Rs.2288.09 lac (Previous year Rs. 2112.30 lac)

(e) No provision has been considered necessary by the Management for the following disputed Income tax, Excise duty, Service tax, Sales Tax, Electricity tax and Employees State Insurance demands which are under various stages of appeal proceedings. The Company has been advised that there are reasonable chances of successful outcome of the appeals and hence no provision is considered necessary for these demands.

*Includes disputes relating to the period 1977 to 1992 decided by the ESI Court in favour of the Company against which the Employees State Insurance Corporation has gone on an appeal before the Hon'ble Madras High Court.

Out of the above demand of Rs.13448.19 lac (Previous year Rs.15422.31 lac), an amount of Rs.864.92 lac (Previous year Rs.3488.11 lac) has been deposited under protest/adjusted by relevant authorities.

(f) Certain unsecured creditors have fi led winding up petitions in the earlier years which are being defended by the Company before the Hon'ble Madras High Court.

Estimates of future salary increase take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

In the absence of relevant information from the actuary, the above details do not include the composition of plan assets.

The details of the experience adjustment arising on account of planned assets and liabilities as required by para 120(n)(ii) of AS15 (Revised) on employee benefits are not available in the valuation report and hence are not furnished.

Due to micro and small enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the Auditors.

Note 11 The Company has reviewed its deferred tax assets and liabilities as at 31 March 2012. The Company has carry forward losses and unabsorbed depreciation, which give rise to deferred tax asset of Rs.28458.84 lac (Previous Year Rs. 54217.29 lac). However in the absence of virtual certainty supported by convincing evidence that sufficient future taxable income will be available against which such deferred tax assets can be realized, the said deferred tax asset that can be recognized is restricted to the net deferred tax liability of Rs.12991.45 lac (Previous Year Rs. 9138.35 lac) as given below. Accordingly, there is no net deferred tax asset or liability as at 31 March 2012 to be accounted for.

Note 12 There is no provision for tax in view of the carried forward losses / unabsorbed depreciation relating to earlier years available for set off while computing income both under provisions of section 115-JB and those other than section 115-JB of the Income Tax Act, 1961.

NOTES (a) Business segments

The business segment has been considered as the primary segment for disclosure. The products included in each of the business segments are as follows:

Continuing

(i) Agro inputs - Urea Operations

(ii) Others - Tissue culture and Seeds

Discontinuing

(i) Agro inputs - Phosphatic Operations

(ii) Bulk drugs and formulations - includes Penicillin - G and formulations

(iii) SMO - Maintenance Contracts

(iv) Others - Enzymes

Revenue and expenses, which relates to the enterprise as a whole and are not allocable to segments on a reasonable basis, have been included under "Unallocated expenditure net of unallocated income."

Unallocated corporate assets and unallocated corporate liabilities include the assets and liabilities which are not directly attributable to segments.

(b) Geographical segments

The geographical segments considered for disclosure are as follows:

- Sales within India include Sales to customers located within India

- Sales outside India include sales to customers located outside India.

Note 13

(a) Previous year figures have been regrouped / recast, wherever necessary, to conform to the classification of the current period and revised Schedule VI of the Companies Act, 1956.

(b) Assets and Liabilities in the Balance Sheet include figures both for Continuing and Discontinuing Operations.

(c) The Provision for doubtful trade and other receivables, loans and advances, provision for non-moving inventories and earlier provision writeback pertains to both Continuing and Discontinuing operations. These are appropriately shown in the Statement of Profit and Loss under Continuing operations and Discontinuing operations. The Balance Sheet contains provision figures both for Continuing and Discontinuing operations in total.

(d) Previous year figures are given in brackets.

1 SPIC Fertilizers and Chemicals Limited, Mauritius (SFCL) (a wholly owned subsibidiary of the Company) holds 1 equity share of One Million Arab Emirate Dinar each in SPIC Fertilizers and Chemicals FZE,Dubai (SFC,FZE). Hence the combined share of the Company and its subsidiary in SFC FZE Dubai is 83.54%. As assets of SFC,FZE Dubai were taken over by Jebel Ali Free Zone Authorities (JAFZA), Dubai SFCL ,Mauritius ceased to have control over its subsidiary SFC,FZE. Hence the details of SFC,FZE Dubai is not given in the above statement.

2 As Jebel Ali Free Zone Authorities (JAFZA) had taken over the assets of SPIC Fertilizers and Chemicals (SFC, FZE), Dubai, the holding company SFCL Mauritius lost control over the subsidiary. Full provision has been made for these investments in earlier years. The company is considering writing off the investments in SFCL Mauritius and is in the process of getting the approval of the concerned Regulatory Authorities to write off the aforesaid investment in the books of account. Hence the financial statements of the subsidiary company SFCL Mauritius have not been considered for consolidation

Mar 31, 2010

1 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs.246.88 lac (Previous year Rs. 400.13 lac).

2. Contingent Liabilities

(a) Claims not acknowledged as debts :

(i) The District Collector, Tuticorin vide his letter dated, 21.8.2009 has demanded Rs.16873.97 lac (Previous year NIL) towards lease rent for the utilization of 415.19 acres of sand quarry poramboke lands by the Company for its effluent treatment and storage of Gypsum for the period from 1975 to 2008 while the assignment proposal submitted by the Company in the year 1975 to the State Government is still pending. The Company had filed a writ petition challenging the demand before the Honble Madras High Court and the court granted interim stay vide its order dated 21.4.2010 on further proceedings.

(ii) The Phosphate Chemical Export Association Inc. USA (Phoschem) filed a suit, for recovery of US$11.52 million during March 2006 towards supply of raw material, before the Honble Madras High Court. The court passed an interim decree in favour of Phoschem for US$8.76 million against which the Company filed a Review Petition on the ground that the Madras Honble High Court has not considered the realization of US$6.31 million by Phoschem from the Insurance company. The Review Petition is still pending before the Honble Madras High Court. The Company had already made a provision of Rs.3914.70 lac towards this claim and the balance claim not acknowledged by the Company is Rs.1247.80 lac (Previous year Rs.1408.40 lac).

(iii) Groupe Chimique Tunisian SA (GCT) initiated arbitration proceedings against the Company for non payment of US$ 15.02 million together with interest towards supply of Phosphoric Acid in the earlier years against which the Arbitral Tribunal passed an award on 9.9.2009 directing the Company to pay a sum of Rs.7300 lac to GCT towards principal and Rs.2500 lac towards interest. The Company filed a petition before the Honble Madras High Court on 07.12.2009 for setting aside the award and the court ordered notice to GCT on 23.12.2009. The matter is pending before the Honble Madras High court. As the Company had already made a provision of Rs.6637.57 lac, the remaining claim not acknowledged by the Company on this account is Rs.3163 lac (Previous year NIL).

(iv) Other claims against the Company, which are being disputed/challenged before the Courts - Rs.4167.05 lac (Previous year Rs. 2519.30 lac).

In respect of the above claims, the Company has been advised that there are reasonable chances of successful outcome of the Appeals / Petitions filed before the Honble Madras High Court and accordingly no further provision is considered necessary.

(b) Guarantees/Security given to Banks/Financial Institutions on behalf of other companies Rs.4500 lac (Previous year Rs.4500 lac).

(c) Other Bank Guarantees outstanding Rs.803.07 lac (Previous year Rs. 765.91 lac).

(d) Cumulative amount of Preference Dividend and Dividend Tax thereon not provided for the period from 1.4.2001 to 31.3.2010 is Rs.1935.94 lac (Previous year Rs. 1759.56 lac).

(e) No provision is considered necessary for the following disputed Income Tax, Sales Tax, Excise duty, Service tax, Electricity tax and Employees State Insurance demands which are under various stages of appeal proceedings. The Company has been advised that there are reasonable chances of successful outcome of the appeals and hence no provision is considered necessary for these demands.

Nature of the Period to which the Name of the Statute

Dues amount relates

Direct Taxes

Income Tax 1996-97 to 2000-01 Income Tax Act, 1961

Excise duty 1998-99 to 2007-08

Indirect Taxes

Central Excise Act, 1944

Service Tax 2003-04 to 2007-08

Sales Tax Act under various State

Local Sales Tax 1996-97 to 2001-02 enactments

Central Sales Central Sales Tax Act, 1956 1998-99 to 2001-02

Tax

Tamilnadu Electricity (Taxation on

Electricity Tax 1985-86 to 1993-94 Consumption) Act, 1962

Employees State Insurance Act * ESI dues 1977 to 2003

Total

Name of the Statute Amount Forum where pending (Rs.in lac)

Direct Taxes Income Tax Act, 1961 2592.46 Madras High Court (2553.69)

Indirect Taxes Central Excise Act, 1944 Commissioner of Central Excise (Appeals) 391.46 / Customs, Excise and Service Tax (407.11) Appellate Tribunal

124.23 Commissioner of Central Excise (Appeals) (124.23) / Madras High Court

Sales Tax Act under various State enactments 156.77 Deputy Commissioner (Appeals) / Sales (156.77) Tax Appellate Tribunal

Central Sales Tax Act, 1956 86.35 Deputy Commissioner (Appeals) / Sales (86.35) Tax Appellate Tribunal

Tamilnadu Electricity (Taxation on Consumption) Act, 1962 An appeal filed against the order dated 1050.54 18th June 2010 of the Single Judge before (1050.54) the Division Bench of the Honble Madras High Court

10697.01

Employees State Insurance Act * ESI Court / Madras High Court (10026.73)

Total 15098.82 (14405.42)

* Includes disputes relating to the period 1977 to 1992 decided by the ESI Court in favour of the Company against which the Employees State Insurance Corporation has gone an appeal before the Honble Madras High Court.

Out of the above demand of Rs 15098.82 lac, an amount of Rs.3637.90 lac (Previous year Rs. 3247.87 lac) has been deposited under protest/adjusted by relevant authorities.

f) Certain unsecured creditors have filed winding up petitions which are being defended by the Company before the Honble Madras High Court

3. (a) Consequent to the implementation of Corporate Debt Restructuring (CDR) Package dated 19.3.2003, the Company had availed interest relief from various banks and financial institutions amounting to Rs.4110.36 lac (Previous year Rs. 4110.36 lac) for the year 2002-03 and therefore accrued the interest liability at the reduced rates in the subsequent years up to 31.3.2008.

(b) As the above CDR did not yield the desired results, the secured lenders preferred to assign their debts in favour of Asset Reconstruction Company (India) Limited (ARCIL). During the year 2008-09, approximately 70% of secured debts in value had been assigned in favour of ARCIL under the provisions of Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). In view of the restructuring package contemplated then, no provision was considered necessary for interest on the secured loans assigned to ARCIL during 2008-09. As on 31st March 2010 twenty two out of thirty five secured lenders covering approximately 84% of secured debts in value had assigned the financial assistance granted by them along with the attendant security interests in favour of ARCIL, under the provisions of SARFAESI Act.

During the year, ARCIL and other financial institutions have approved the rework package dated 13.3.2010 through CDR mechanism (read with Term Sheet of ARCIL dated 28.3. 2010,) on successful implementation of which the Company would be eligible for substantial reduction in debts and interest accrued thereon. The Company has, during the year, paid Rs.35999.47 lac to ARCIL for distribution to secured lenders (including to those whose debts had not been assigned to ARCIL) and has also converted part of the debts amounting to Rs.3000 lac into equity as stipulated in the CDR Rework Package. Though the Company has commenced payment of dues to ARCIL, credit has not been taken for the expected relief in loan and interest liabilities vis a vis the corresponding amounts taken over by ARCIL the amounts acknowledged as dues by other lenders in the rework package, pending satisfactory completion /compliance of various conditions stipulated in the said package.

(c) Based on the amount of secured debts including accrued interest taken over by ARCIL and also the dues recognized in the rework package for granting relief, the excess interest liability over the said amounts accrued in the books amounting to Rs.17065.40 lac has been written back to Profit and Loss Account. Also considering the balance provision for interest available in the books, no further provision is considered necessary for the interest liability on certain unsecured loans and consequently there is no charge to Profit and Loss Account for the year on this account.

(d) As certain working capital banks raised claims before the Honble Debts Recovery Tribunal (Honble DRT), which the Company is contesting, opening of letters of credit by banks was affected. As a result, the Ammonia and Urea plants which were stopped on 26.3.2007 for turnaround activities could not be recommenced. The phosphatic plant also could not be operated until 18.8.2007. In compliance with Honble DRTs interim order dated 19.6.2007, certain banks opened fresh letters of credit and this enabled the Company to recommence its operations of the phosphatic plants from 19.8.2007 to 4.2.2008. While disposing the interim applications filed by the Company, the Honble DRT had directed the lead bank viz Indian Bank vide its order dated 3.1.2008 to deposit the subsidy amount retained by it in the fixed deposits of certain banks. An appeal was filed by the lead bank against the above direction and the Honble Debt Recovery Applellate Tribunal (DRAT) vide its order dated 24.1.2008 had directed the lead bank to keep the subsidy amounts in maximum interest earning no-lien account effective 25.1.2008 until further orders. The Company filed an appeal challenging the aforesaid order of Honble DRT and DRAT in its order dated 5.3.2008 directed the lead bank to disburse a sum of Rs.800 lac per month commencing from 15.3.2008 from the said deposit to the Company to meet statutory and critical payments and make a one time payment of Rs.500 lac for its start up expenses.

Consequent to the dismissal of the writ petitions/civil revision petitions filed before the Honble Madras High Court and the Special Leave Petition filed before the Honble Supreme Court by the lead and other banks challenging the DRAT order dated 5.3.2008 the Company received Rs10400 lac on 23.3.09 out of Rs.25368 lac which was kept in the deposit account as on that date. The Company recommenced production of phosphatic fertilizers utilizing the above funds from 8.4.2009 and continued the production throughout the financial year 2009-10. The Company further received Rs.4800 lac out of Rs.7832 lac realised through monetization of fertilizer bonds and fertilizer concession from Govt. of India, as per the direction of DRAT.

After the assignment of financial assistance along with the attendant security interests in favour of ARCIL by a secured lender, who originally filed recovery claim before Honble DRT, ARCIL filed a substitution petition before Honble DRT in its place which was allowed on 25.6.2009. ARCIL also filed an application on 6.7.2009 before Honble DRT with a prayer to direct the lead bank to deposit Rs.15000 lac from the no-lien account maintained by it for the purpose of distribution among the secured lenders on pro-rata basis based on the principal amount outstanding. The Company also filed its counter before Honble DRT wherein it was informed that the prayer of ARCIL may be considered on merits, subject to the condition that the monetized amount of fertilizer bonds, pipeline and future subsidy receipts from Govt. of India on account of urea production may be permitted to be released without any objection by ARCIL and other secured lenders directly to Indian Oil Corporation Limited (IOC) towards future supply of raw materials in accordance with the Memorandum of Understanding proposed to be executed in this connection between the Company and IOC. Meanwhile, the Corporate Debt Restructuring Cell (CDR) convened a meeting of Corporate Debt Re-structuring Empowered Group (CDREG) on 31.8.2009 and appointed ARCIL as the monitoring agent for the Trust and Retention Account (TRA) in place of Indian Bank, the lead bank. CDREG also authorized ARCIL to approach Honble DRT or any other fora/statutory authorities on behalf of the secured lenders for the appropriation of Rs.15000 lac lying in the TRA in favour of the secured lenders.

HonAble DRT after considering the submissions of ARCIL, the Company and the decisions taken by CDREG on 31.8.2009, made the following directions, vide its order dated 22.9.2009.

i) Indian Bank, the lead bank was directed to deposit Rs.15000 lac out of the subsidy amount of Rs.18708 lac lying in the Trust and Retention Account in a no lien interest bearing fixed deposit in HDFC Bank, Mumbai subject to the condition that the said amount would be distributed among the lender banks on prorata basis based on the principal amount outstanding and in accordance with the directions of CDREG within seven days from the date of order.

ii) The lead bank was also directed to release a sum of Rs. 3000 lac out of Rs.18708 lac lying in Trust and Retention Account as well as future urea subsidy receivable from Government of India (GOI) directly to IOCL towards future supply of raw materials in accordance with the Memorandum of Understanding to be executed by the Company with IOCL. The balance amount of Rs.708 lac along with the monetized amount of the fertilizer bonds with the face value of Rs.435 lac as well as future fertilizer concession receivable from GOI on account of production of phosphatic fertilizers shall be released to the Company for its operations and the same shall be monitored by ARCIL as per CDR mechanism.

In compliance with the above directions of Honble DRT, the lead bank deposited Rs.15000 lac in ARCILs account with HDFC Bank, Mumbai. As on 31.3.2010, the balance that remained in the deposit account maintained by the lead bank was Rs.3000 lac (Previous year Rs.14968 lac).The lead bank released Rs.3000 lac to IOCL on 24.4.2010 from the deposit account, as per the Supply Agreement executed by the Company with IOCL as referred in Note 3(e) below.

(e) The Company has executed a Memorandum of Understanding with IOCL on 19.4.2010 mutually agreeing the terms and conditions for the execution of the Supply Agreement for resumption of supply of Naphtha and Furnace Oil and settlement of certain past dues. The Supply Agreement was also executed by the Company with IOCL on 24.4.2010 for the supply of Naphtha and furnace oil on agreed terms and conditions.

(f) One lender had sent a communication to the Company withdrawing its consent to the CDR package dated 19.3.2003 and advised the Company to take note of the same. The Company has not received any demand from this lender so far, though as per the approved restructuring package, the lender retains the right to revoke the package in case the Company does not meet its commitments as stipulated in the package. However, the Company has accrued interest on the said loan at the original rate from the date of disbursement of loan.

4. Going Concern

In spite of erosion of net-worth, the financial statements of the Company have been prepared on a going concern basis, in view of the following:

i) The Company had recommenced its production of phosphatic fertilizers from 8.4.2009 and continued the production during the current year. The other Divisions, viz. SPIC Maintenance Organization, Enzymes, API and Formulation Units and Agri Business, continued their operations throughout the financial year.

ii) The rework package dated 13.3.2010 approved under CDR mechanism (read with Term Sheet of ARCIL dated 28.3.2010), as referred in Note 3 (b) envisages bringing down the debts to a sustainable level consequently improving the net-worth.

iii) The Supply Agreement executed on 24.4.2010 by the Company with Indian Oil Corporation Ltd. (IOC) will enable the Company to source Naphtha and Furnace oil and recommencement of operations of its nitrogenous fertilizer plants in the near future.

iv) The assurance of Department of Fertilizers, Government of India (GOI), to cut down the urea subsidy payment cycle will result in reduction of working capital requirement and enable the Company to operate its nitrogenous fertilizer plants at stipulated capacity levels.

v) The Notification issued by the Department of Fertilizers, GOI, increasing the fixed cost reimbursements in urea operations resulting in additional realization of fertilizer subsidy and consequent improvement in profitability.

vi) The fresh order value received by SMO Division during the period from 1.4.2009 to 31.7.2010 aggregates to Rs.43017 lac. This will enhance the revenue and also improve the profitability in the coming years.

The above positive developments will enable the Company to operate the fertilizer plants, being its core business, at optimum levels which will enable the Company to continue its operations with improvement in the profitability.

5. During the year, the useful life of fixed assets relating to Pen G unit was reviewed in terms of technological obsolescence, energy efficiency and cost of operations. Consequent to the review, the carrying value of these assets as on 1st April 2009 is being amortized over their revised remaining useful life resulting in the depreciation charge for the year being higher by Rs.1409.38 lac with a corresponding impact on the loss for the year.

6. The Companys investments included Rs.18453.62 lac (Previous year Rs.18453.62 lac) in equity share capital of SPIC Fertilizer and Chemicals Limited, Mauritius, which has invested in a wholly owned subsidiary company, viz. SPIC Fertilizers and Chemicals FZE Dubai(SFC Fze Dubai) , whose objective was production of ammonia and urea in Jebel Ali Free Zone, Dubai. Since the project did not materialize due to non allocation of gas, the said subsidiary company had commenced activities for dismantling the existing plant and machinery at the project site with a view to relocate the same where assured gas supply could be obtained.

Meanwhile, the Jebel Ali Free Zone Authorities (JAFZA), Dubai had issued a notice on 24.3.2010 to SFC Fze Dubai, for vacation of site and surrender of materials and machineries on site to JAFZA towards land lease arrears amounting to Rs.2483.50 lac (equivalent to 203,34,918.75 AED) due to them failing which they will initiate legal action against the company. SFC Fze, Dubai, has conveyed its consent to the above authorities to avoid proposed legal action and consequent damages. However, full provision has been made by the Company for the carrying value of investment in this step down subsidiary along with other dues from it and the Company does not expect any further liability on this account.

7. Capital work in progress/advances include a sum of Rs. 2091.04 lac (Previous year Rs.2091.04 lac) being advances paid to MCC Finance Limited for purchase of certain immovable properties. The Company entered into sale agreements for these properties with MCC Finance Limited and the execution and registration of sale deeds are pending. The Administrator/Provisional Liquidator of MCC Finance Limited filed a Petition before the Company Court at Chennai seeking a direction that the sale agreements entered into between the Company and MCC Finance Limited be declared null and void. The said Petition was allowed by the Single Judge on 18.6.2003. The Company has filed an appeal against the Order before the Division Bench of the Honble Madras High Court. The Division Bench admitted the appeal and ordered status quo be maintained, pending disposal of the appeal.

8. The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in 1994-95 for the manufacture of Polyester Filament Yarn (Capacity: 80000 TPA) and Purified Terepthalic Acid (Capacity: 315000 TPA). The Company has so far invested Rs.25375.00 lac in the equity share capital, Rs.5.00 lac in 8% redeemable cumulative non convertible preference share capital, Rs.30609.63 lac in Unsecured Zero Interest Bonds redeemable after 12 years from the date of commencement of commercial production or repayment of all the term loans to the lenders, whichever is earlier. In view of the pending litigation between Chennai Petroleum Corporation Limited (CPCL) and the Company and the consequent interim injunction granted by the Honble Madras High Court in 1997 to stop implementation of activities, there has been a suspension of activities.

While SPIC Petro was pursuing its revival efforts, the Honble Single Judge of the Honble Madras High Court ordered the winding up of the company on 17.4.2009 and appointed the Official Liquidator to take charge of all the properties and effects of the company, at the time of disposing the winding up petitions filed by certain unsecured creditors.

Against the above winding up order, SPIC Petro filed an appeal and obtained an interim stay from the Division Bench of the Honble Madras High Court on 5.5.2009. After several hearings, the Division Bench vide its order dated 16.12.2009 directed SPIC Petro to pay an amount of Rs.110 lac as part-payment to certain unsecured creditors who have initiated the winding up proceedings before the court, on or before 31.3.2010. Since SPIC Petro was unable to make the above payment on or before 31.3.2010, the Division Bench of the Honble Madras High Court, dismissed the appeal on 26.4.2010. Meanwhile, ARCIL issued a notice on 19.3.2009, u/s 13(2) of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act), directing SPIC Petro to make payment of the dues to ARCIL within sixty days from the date of the notice. As SPIC Petro could not make the payment, ARCIL took over the possession of the assets of SPIC Petro, under SARFAESI Act on 13.5.2010.

However, the Official Liquidator appointed by the Madras High Court has taken over possession of the assets and effects of SPIC Petro on 14.5.2010, in accordance with the order issued by the Division Bench of the Honble Madras High Court on 26.4.2010. Since then, the assets of the Company are under the control of the Official Liquidator.

In view of the above developments, full provision has been made for the carrying value of investments in SPIC Petro and all other dues from it.

9. The Company has given an undertaking to the lenders of Tuticorin Alkali Chemicals and Fertilizers Limited for non disposal of its shareholdings in the said company without their prior approval.

10. During the year, the company did not receive any "Fertilizer Companies Government of India Special Bonds" (Previous year Rs. 434.90 lac) towards subsidy receivable. The bonds already received in the previous years are tradable in the market and therefore, it is restated at fair value as at 31st March 2010 resulting in a charge to the Profit and Loss Account of Rs.6.46 lac (Previous year Rs. 42.33 lac). The Company has also disposed of bonds worth Rs.2600.00 lac (Previous year Rs. 1750.40 lac) during the current year and the profit on sale of such bonds amounting to Rs. 66.23 lac (Previous year Rs. 144.21 lac) has been credited to the Profit & Loss Account under the head "Other Income".

11. The Government of India grants price concession on sale of fertilizers and income from such concession is shown under ÃSales in the Profit and Loss Account. The subsidy income for the year includes Rs.11894.86 lac, (net of estimated downward revision in subsidy Rs.197.26 lac) being income recognized having regard to the existing price concession scheme for the period for which notification has not been issued and accrued based on the managements estimates. Necessary adjustment to such estimates will be made on announcement of final notification/determination.

12. Sundry debtors and loans & advances include certain overdue and unconfirmed balances. However, in the opinion of the Management these current assets would in the ordinary course of business realize the value as stated in the accounts.

Estimates of future salary increase take into account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

In the absence of relevant information from the actuary the above details do not include the composition of plan assets.

The appointment and remuneration of a former Director for the period 30.7.1990 to 26.9.1990, aggregating to Rs.19206.90 paid during earlier years, is subject to approval of the shareholders and the Central Government.

The appointment and remuneration of the Chairman for the period 1.10.2009 to 31.3.2010 is subject to the approval of the shareholders and the Central Government.

The Company has filed necessary application to the Central Government for its approval.

The Whole-time Director is covered under the Companys Gratuity Policy along with the other employees of the Company. Proportionate amount of gratuity is not included in the aforementioned disclosure.

Disclaimer: This is 3rd Party content/feed, viewers are requested to use their discretion and conduct proper diligence before investing, GoodReturns does not take any liability on the genuineness and correctness of the information in this article