Notes to Accounts of Star Ferro and Cement Ltd.

Mar 31, 2016

A) Terms/Rights attached to the Equity Shares & Notes

The Company has only one class of equity shares having par value of Rs. 1/- per share. Each holder of equity shares is entitled to one vote per share.

The Company declares and pays dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting except in case of interim dividend.

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.

b) Terms of issue of shares other than cash

Pursuant to the Scheme of Arrangement ("the scheme") between Century Plyboards (India) Limited (CPIL), the Company and their respective shareholders as approved by the Hon''ble High Court at Kolkata vide its order dated 17th May, 2013, the Company has issued and allotted 22,21,72,990 Equity Shares to the shareholders of CPIL in ratio of 1 (one) Equity share of Rs. 1/- each of the Company as fully paid up for every 1 (one) Equity Share of Rs. 1/- each held by them in CPIL.

1. There are no Micro, Small and Medium Enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues on account of principal amount together with interest and accordingly no additional disclosures have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the Company.

2. EMPLOYEE DEFINED BENEFITS

(a) Defined Contribution Plans : The Company has recognized an expense of Rs. 3.20 Lacs (Previous year Rs. 2.37 Lacs) towards the defined contribution plans.

(b) The Company has a defined benefit gratuity plan. Every employee who has completed five years or more service is entitled to Gratuity on terms not less than the provisions of The Payment of Gratuity Act, 1972. The following tables summarize the components of net benefit expenses recognized in the Statement of Profit & Loss and amounts recognized in the Balance Sheet for the Gratuity.

(c) Under leave encashment scheme, the Company allows its employees to encash accumulated leave over and above thirty days at any time during the year.

(d) Defined Benefit Plans - As per Actuarial Valuation as at 31st March, 2016.

3. The Company does not have any reportable segment in accordance with the principle outlined in Accounting Standard (AS 17), "Segment Reporting". Therefore, the disclosure requirements on "Segment Reporting" is not applicable.

4. As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three Financial Years on Corporate Social Responsibility (CSR) activities. The areas for CSR activities are eradication of hunger and malnutrition, promoting education, art and culture, healthcare, destitute care and rehabilitation, environment sustainability, disaster relief and rural developments projects.

A CSR Committee has been formed by Company as per the Act. The funds were primarily utilized through out the year on these activities which are specified in Schedule VII of the Companies Act, 2013.

a) Gross Amount required to be spent by the Company during the year is Rs. 2.23 Lacs (Rs. 3.15 Lacs)

b) Amount spent during the year on:

5. Figures have been rounded off to the nearest Rs. in Lacs. Previous year''s figures including those given in brackets have been rearranged and regrouped where necessary to confirm to the current year''s classifications.

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Mar 31, 2015

1. CORPORATE INFORMATION

Star Ferro and Cement Limited (the Company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on National Stock Exchange and Bombay Stock Exchange in India. The Company is holding investments in its subsidiaries which are engaged in manufacture of Cement, Cement Clinker and generation of Power.

1.1 Basis of Preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The Company has prepared these financial statements to comply in all material respects with the Accounting Standards as prescribed under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and the relevant provisions of the Companies Act, 2013, to the extent notified. The financial statements are prepared under the historical cost convention on accrual basis and on the basis of going concern. The accounting policies are consistently followed by the company and changes in accounting policy are separately disclosed.

2. SCHEME OF ARRANGEMENT

a) Pursuant to the Scheme of Arrangement ("The Scheme") between the Company, Shyam Century Ferrous Limited (SCFL) and their respective shareholders as approved by the Hon'ble High Court of Meghalaya at Shillong vide its order dated 31st March, 2015, all the assets and liabilities of the Ferro Alloy division (i.e. business and interest of the company in manufacture of Ferro Alloys including captive power plant at Byrnihat in the State of Meghalaya) and investment in 83,58,998 Equity Shares of Meghalaya Power Limited of face value of Rs.10/- each, have been transferred to and vested in Shyam Century Ferrous Limited (Resulting Company) at their respective book values on a going concern basis with effect from 1st April, 2014 being the appointed date. The said order of the Hon'ble High Court has been filed with the Registrar of Companies on 10th April, 2015, the effective date of the scheme and accordingly, the Scheme of Arrangement has been given effect to in these accounts.

b) The details of assets and liabilities transferred to the Resulting Company are as under:

3. CONTINGENT LIABILITIES

(Rs. in Lacs)

Particulars 31st March, 2015 31st March, 2014

Contingent Liabilities not provided for in respect of:

(a) Bills discounted with banks - 2,088.71

(b) Solvent surety given to Excise Department against differential - 404.88 excise duty refund

4. There are no Micro, Small and Medium Enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues on account of principal amount together with interest and accordingly no additional disclosures have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the Company.

5. EMPLOYEE DEFINED BENEFITS

(a) Defined Contribution Plans: The Company has recognised an expense of Rs.2.36 Lacs (Previous year Rs.9.28 Lacs towards the defined contribution plans).

(b) The Company has a defined benefit gratuity plan. Every employee who has completed five years or more service is entitled to Gratuity on terms not less than the provisions of The Payment of Gratuity Act, 1972. The following tables summarise the components of net benefit expenses recognised in the Statement of Profit and Loss and amounts recognised in the balance sheet for the Gratuity.

(c) Under leave encashment scheme, the company allows its employees to encash accumulated leave over and above thirty days at any time during the year.

(d) Defined Benefit Plans - As per Actuarial Valuation as at 31st March, 2015.

6. The company's subsidiary, Cement Manufacturing Company Limited have proposed final dividend of Rs.8/- per share. Pending approval of the same in their Annual General Meeting, this income has not been recognised in these accounts.

7. Figures have been rounded off to the nearest Rs. in Lacs. Previous year's figures including those given in brackets have been rearranged and regrouped where necessary to confirm to the current year's classifications. Further, previous year figures include figures of Ferro Alloy division which has been demerged w.e.f. 1st April, 2014 pursuant to the Scheme of Arrangement (Refer note no. 28) and hence are not comparable with the current year's figure.

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Mar 31, 2014

1 CONTINGENT LIABILITIES Rs. in Lacs

Particulars 31st March, 31st March 2014 2013 Contingent Liabilities not provided for in respect of :-

(a) Bills discounted with banks 2,088.71 855.77

(b) Solvent surety given to Excise Department against differential excise duty refund 404.88 -

2. There are no Micro, Small and Medium Enterprises, as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues on account of principal amount together with interest and accordingly no additional disclosures have been made. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of the information available with the Company.

3. Excise Duty Refund

Against company''s claim for refund of differential excise duty, Hon''ble High Court at Guwahati (Shillong Bench) vide its order dated 12th September, 2012, has directed the Excise Department to release 50% of the differential amount against furnishing of solvent surety in line with the Interim Order dated 13th January, 2012 passed by Hon''ble Supreme Court in case of "VVF Ltd and others". Based on the said judgment of Hon''ble High Court in favour of the Company and legal opinion obtained by the Company, the differential excise duty refund of Rs.901.02 lacs has been recognized as revenue in the books of account.

4. The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of services is entitled to Gratuity on terms not less favorable than the provisions of The Payment of Gratuity Act, 1972.

The following tables summarize the components of net benefit expenses recognized in the Statement of Profit & Loss and the funded status and amounts recognized in the balance sheet for the Gratuity. Rs. in Lacs

5. Related Party Disclosures

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

Related parties where control exists

Subsidiary Companies :

Cement Manufacturing Company Limited Megha Technical & Engineers Private Limited Meghalaya Power Limited Star Cement Meghalaya Limited NE Hills Hydro Limited

Related parties with whom transactions have taken place during the year

Key Management Personnel :

Mr. Sajjan Bhajanka (Chairman) Mr. Sanjay Agarwal (Director) Mr. Hari Prasad Agarwal (Managing Director)

Enterprises Owned/ Influenced by Key Management Personnel or their relatives. :

Brijdham Merchants Private Limited Sriram Vanijya Private Limited

Mrs. Santosh Bhajanka (Wife of Mr. Sajjan Bhajanka) Mrs. Sonu Kajaria (Daughter of Mr. Sajjan Bhajanka) Mrs. Payal Agarwal (Daughter of Mr.Sajjan Bhajanka)

Relatives of Key Management Personnel :

Mrs. Shradha Agarwal (Daughter of Mr. Sajjan Bhajanka) Mrs. Divya Agarwal (Wife of Mr. Sanjay Agarwal) Mrs. Sumitra Devi Agarwal (Wife of Mr. Hari Prasad Agarwal) Mr. Rajesh Kumar Agarwal (Son of Mr. Hari Prasad Agarwal)

Notes:

(a) Business Segments: The business segments have been identified on the basis of the products of the Company. Accordingly, the Company has identified following business segments:

Ferro-Alloys - Ferro Silicon

Power - Generation of Power

(b) Geographical Segments: The Company operates predominantly within the geographical limits of India and accordingly secondary segments have not been considered.

6. Figures have been rounded off to the nearest Rs. in Lacs. Previous year''s figures including those given in brackets have been rearranged and regrouped where necessary to confirm to the current year''s classifications.

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Mar 31, 2013

1 Basis of Preparation

The financial statements have been prepared to comply in all material respects with the Accounting Standards notified by the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis and on the basis of going concern. The accounting policies applied by the Company are consistent with those used in the previous year.

2. Scheme of Arrangement

a) Pursuant to the Scheme of Arrangement ("the scheme") between Century Plyboards (India) Limited (CPIL), the Company and their respective shareholders as approved by the Hon''ble High Court at Kolkata vide its order dated 17th May, 2013, all the assets and liabilities of the Ferro Alloys and Cement division (i.e., business and interests in manufacture of Ferro alloys and cement, including captive power plant attached thereto) of CPIL have been transferred to and vested in the Company at their respective book values on a going concern basis with effect from 1st April, 2012 being the appointed date. Accordingly, the Scheme of Arrangement has been given effect to in these accounts.Hence the previous year''s figures are not comparable.

d) Pursuanttothesaidscheme,theCompanywillissueand allot its Equity Shares to the shareholders of CPIL in ratio of 1 (one) Equity share ofRs. 1/- each of the Company as fully paid-up for every 1 (one) Equity Share ofRs. 1/- each held by them in CPIL. Pending allotment of these shares, the amount ofRs. 2,216.73 Lacs is disclosed as ''Share Capital - pending allotment''. Consequent to the allotment of new shares as per the scheme, current share capital of the Company of Rs. 5 Lacs will be cancelled and the Company ceases to be subsidiary of the CPIL.

3. Contingent Liabilities (Rs. in Lacs)

March, 2013 31st March, 2012

Contingent Liabilities not provided for in respect of:

(a) Bills discounted with banks 855.77

4. Excise duty debited to Statement of Profit & Loss is Net of Subsidy Rs. 362.33 Lacs (Rs. Nil).

5. The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service is entitled to Gratuity on terms not less favorable than the provisions of The Payment ofGratuity Act, 1972. The scheme isfunded with an insurance company.

6. Previous year''s figures including those given in brackets have been rearranged where necessary to confirm to the current year''s classifications.

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Mar 31, 2012

1 Corporate Information Star Ferro and Cement Limited (the company) is a public company domiciled in India ana incorporated under the provisions of the Companies Act, 1956. Commercial operations of the company is yet to commence.

a In the opinion of the Management and to the best of their knowledge and belief the value on realization of loans, advances and other current assets in the ordinary course of business will not be less than the amount at which they are stated in the Balance Sheet.

b As there were no employees in the company, provision for retirement benefit is not required. c Deferred Tax Asset has not been recognized since there is no virtual certainty of its realization.

c Earning in Foreign Currency - Nil (Previous Year- Nil) Expenditure in Foreign Currency-Nil (Previous Year-Nil)

d The figures have been rounded off the nearest rupee.

e Previous Year Figures - Till the year ended 31st March 2011, the company was using pre-revised Schedule VI to the Companies Act 1956, for the preparation and presentation of its financial statements. During the year ended 31st March, 2012, the revised Schedule VI notified under Companies Act, 1956 has become applicable to the company. The company has reclassified previous year figures to confirm to this year''s classification,

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Mar 31, 2011

1. This is the first account since the date of incorporation of the Company i.e.101h Day of March 2011 and hence there are no previous year figures.

2. Estimated Amount of Contracts to be Executed Rs. NIL

3. Information pursuant to provisions of paragraphs 3, 4~C and 4-D of Part -II of Schedule VI to the Companies Act, 1956.

NOT APPLICABLE

4. In the opinion of the Board Current Assets, Loans and Advance have a value on realisation equal to the amounts at which they are stated in the Balance Sheet, in the ordinary course of Business.

5. Earnings in Foreign Currency are Nil.

6. Expenditure in Foreign Currency is Nil.

7. Figures have been rounded off to the nearest rupee.