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Notes to Accounts of Tide Water Oil Company India Ltd.

Mar 31, 2018

1 Company Background

Tide Water Oil Co. (India) Limited (the âCompany'') is a public limited company, incorporated and domiciled in India. The equity shares of the Company are listed on the National Stock Exchange of India Limited, the BSE Limited and the Calcutta Stock Exchange in India. The registered office of the Company is located at âYule House'', 8 Dr. Rajendra Prasad Sarani, Kolkata - 700 001, West Bengal, India.

The Company is mainly engaged in the business of manufacturing and marketing of lubricants.

The standalone financial statements were approved and authorised for issue in accordance with the resolution of the Company''s Board of Directors on 30th May, 2018.

(a) Terms and Rights attached to Equity Shares

The Company has one class of Equity Shares having a par value of Rs. 5/- per share . Each shareholder is eligible for one vote per share held. 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, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

Securities Premium Account

Securities premium is used to record premium received on issue of shares. The reserve may be utilised in accordance with the provisions of the Act.

General Reserve

Under the erstwhile Companies Act 1956, a general reserve was created through an annual transfer of net profits at a specified percentage in accordance with applicable regulations. Consequent to the introduction of the Act, the requirement to mandatory transfer a specified percentage of net profit to general reserve has been withdrawn though the Company may transfer such percentage of its profits for the financial year as it may consider appropriate. Declaration of dividends out of such reserve shall not be made except in accordance with rules prescribed in this behalf under the Act.

The applicable Indian statutory income tax rate for the year ended 31 st March, 2018 was 34.608% (Previous Year: 34.608%). During the year ended 31st March, 2018, the Company has recognised deferred tax charge of Rs. 0.04 Crores on account of change in substantially enacted future tax rate from 34.608% to 34.944% as per Finance Act, 2018.

Note 2

DISCLOSURE ON SPECIFIED BANK NOTES

During last year, the Company had specified bank notes or other denominations as defined in the MCA notification G.S.R. 308(E) dated 31 st March, 2017 on the details of Specified Bank Notes (SBNs) held and transacted during the period from 8th November, 2016 to 30th December, 2016, the denomination wise SBNs and other notes as per the notification is given below:

* For the purpose of this clause, the term ''Specified Bank Notes'' shall have the same meaning provided in the notification of the Government of India, in the Ministry of Finance, Department of Economic Affairs number S.O. 3047(E) dated 8th November, 2016.

Note 3

EMPLOYEE BENEFITS:

(I) Post Employment Obligations - Defined Contribution Plans

The Company has certain Defined Contribution Plans viz. Provident Fund and Superannuation Fund. Contributions are made to Provident Fund in India for employees at the rate of 12% of basic salary as per regulations. The contributions are made to registered Employees'' Provident Fund Organisation (EPFO) administered by the government. The Company has a defined contribution superannuation plan for which contribution is made at a rate not exceeding 4.87% of Basic and Dearness Allowance of the member to Superannuation Fund. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation.

During the year, an amount of Rs. 4.35 Crores (Previous Year: Rs. 3.77 Crores) has been recognised as expenditure towards defined contribution plans of the Company.

(II) Post Employment Obligations - Defined Benefit Plans

(A) Gratuity (Funded)

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The plan is being managed by a separate Trust Created for the purpose and obligations of the Company is to make contribution to the Trust based on actuarial valuation. Liabilities with regard to the Gratuity Plan are determined by actuarial valuation as set out in Note 2.17(ii) above, based upon which, the Company makes contribution to the Employees'' Gratuity Fund.

(B) Post- retirement Medical Scheme

Under this scheme, certain categories of employees of the company get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The scheme is unfunded.

The following table sets forth the particulars in respect of the Gratuity Plan (Funded) and Medical (Unfunded) of the Company for the years ended 31st March 2018 and 31st March 2017:

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognised in the Balance Sheet.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the previous year.

(l) Expected Contribution to Post-Employment Benefit Plan (Gratuity) in the next twelve months are Rs. 4.60 Crores (Previous Year: Rs. 3.43 Crores).

(III) Leave Obligations

The Company provides for encashment of leave or leave with pay by certain categories of its employees subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The Company records a provision for leave obligations in the year in which the employee renders the services that increases this entitlement.

(IV) Risk Exposure

The Company is exposed to a number of risks through the defined benefit plans. The most significant of which are detailed below:-

Investment Risk:

The defined benefit plans are funded with Life Insurance Corporation of India (LICI). The Company does not have any liberty to manage the funds provided to LICI. The present value of the defined benefit plan liability is calculated using a discount rate determined by reference to the Government of India bonds. If the return on plan asset is below this rate, it will create a plan deficit.

Discount Rate Risk:

The Company is exposed to the risk of fall in discount rate. A fall in discount rate will eventually increase the ultimate cost of providing the above benefit thereby increasing the value of the liability.

Demographic Risk:

In the valuation of the liability, certain demographic (mortality and attrition rates) assumptions are made. The Company is exposed to this risk to the extent of actual experience eventually being worse compared to the assumptions thereby causing an increase in the benefit cost.

Salary Growth Risk

The present value of the defined benefit plan liability is calculated by reference to the future salaries of plan participants. An increase in the salary of the plan participants will increase the plan liability.

* Amounts are below the rounding off norm adopted by the Company

a The Company has made an irrevocable election at date of transition to recognise changes in fair value of investments in equity securities which are not held for trading through OCI rather than profit or loss as the management believes that presenting fair value gains and losses relating to these investments in the Statement of Profit and Loss may not be indicative of the performance of the Company.

(i) Fair Value Hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognised and measured at fair value and (b) measured at amortised cost and for which fair values are disclosed in the standalone financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under Ind AS. An explanation of each Level follows below.

Level 1

Quoted prices in an active market (level 1): This level of hierarchy includes financial assets that are measured by reference to quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2

Valuation techniques with observable inputs (level 2): This level of hierarchy includes financial assets and liabilities, measured using inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e , derived from prices).

Level 3

Valuation techniques with significant unobservable inputs (level 3): This level of hierarchy includes financial assets and liabilities measured using inputs that are not based on observable market data (unobservable inputs). Fair values are determined in whole or in part, using a valuation model based on assumptions that are neither supported by prices from observable current market transactions in the same instrument nor are they based on available market data. This level of hierarchy includes Company''s investments in equity shares which are unquoted or for which quoted prices are not available at the reporting dates.

(ii) Valuation Technique Used to Determine Fair Value

Specific valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

(iii) Fair Value Measurements using Significant Unobservable Inputs (Level 3)

Note 4

FINANCIAL RISK MANAGEMENT

The Company''s activities expose it to market risk, liquidity risk and credit risk. In order to minimize effects of the identified risks, various arrangements are entered into by the Company. The following table explains the sources of risk and how the Company manages the risk in its financial statements.

A) Credit Risk

The Company takes on exposure to credit risk, which is the risk that counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises from cash equivalents with banks, investments carried at amortised cost, deposit with banks as well as credit exposure to customers and other parties. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets disclosed in Note 40.

Customer credit risk is managed by the Company through established policy and procedures and control relating to customer credit risk management. Trade receivables are non-interest bearing. The Company has a detailed review mechanism of overdue customer receivables at various levels within organisation to ensure proper attention and focus for realisation. Trade receivables are consisting of a large number of customers. Where credit risk is high, trade receivables are backed by security deposits.

The Company uses specific identification method in determining the allowances for credit losses of trade receivables considering historical credit loss experience and is adjusted for forward looking information. Receivables are deemed to be past due or impaired with reference to the Company''s normal terms and conditions of business. These terms and conditions are determined on a case to case basis with reference to the customer''s credit quality and prevailing market conditions.

Credit risk from balances with banks, deposits, etc is managed by the Company''s finance department. Investments of surplus funds are made only with approved counterparties in accordance with the Company''s policy. None of the Company''s cash equivalents with banks, deposits, investments and other receivables were past due or impaired as at 31st March, 2018 and 31st March, 2017.

B) Liquidity Risk

Liquidity risk is the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities that are settled by delivering cash or another financial asset.

Prudent risk liquidity management implies maintaining sufficient cash and cash equivalents and the availability of committed credit facilities to meet obligations when due.

Management monitors rolling forecasts of the group''s liquidity position on the basis of expected cash flow. The Company has access to the following undrawn borrowing facilities at the end of the reporting period:

Bank overdraft facilities may be drawn at any time and may be terminated by the bank without notice.

The following table gives the contractual discounted cash flows following due within the next 12 (twelve) months.

C) Market Risk

i) Foreign Currency Risk

The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with regard to USD. Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not the Company''s functional currency (INR). As per the risk management policy, the gross currency movements are continually monitored . As the total exposure through currency risk directly is not material, generally forward contracts are not entered into on a regular basis.

ii) Commodity Price Risk

The Company''s exposure to market risk with respect to commodity prices primarily arises from the fact that it is a purchaser of base oil. Base oil is a commodity product whose prices can fluctuate sharply over short periods of time. The prices of base oil generally fluctuate in line with commodity cycles. Material purchase forms the largest portion of the Company''s operating expenses. The Company evaluates and manages commodity price risk exposure through operating procedures and sourcing policies. The Company has not entered into any commodity derivative contracts. It may also be noted that there are no direct derivatives available for base oil, but there are derivatives for crude oil.

Note 5

CAPITAL MANAGEMENT

(A) Risk Management

The Company''s objectives when managing capital are to:

a) Safeguard their ability to continue as a going concern

b) Maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders or issue new shares. As on the reporting date, the Company is debt free and it is not subject to any externally imposed capital requirements.

No changes were made to the objectives, policies or processes for managing capital during the years ended 31 st March, 2018 and 31st March, 2017.

Note 6

TIDE WATER OIL COMPANY (INDIA) LIMITED EMPLOYEE BENEFIT TRUST (âEMPLOYEE BENEFIT TRUSTâ)

The Company had instituted Tide Water Oil Co. (India) Ltd. Employee Welfare Scheme as approved by shareholders vide postal ballot dated 2nd March, 2011. Subsequent to promulgation of Securities Exchange Board of India (Share Based Employee Benefits Regulations), 2014, the shareholders vide their postal ballot resolution dated 14th January, 2016, aligned the provisions of the aforesaid scheme with that of the said regulations. The scheme had also been rechristened as Tide Water Oil Company (India) Limited Employee Benefit Scheme. No option has been granted during the year, under this scheme.

The scheme continues to be administered by an independent Trust viz., Tide Water Oil Company (India) Limited Employee Benefit Trust [erstwhile Tide Water Oil Co. (India) Ltd. Employee Welfare Trust]. The objective of the trust is acquiring shares from the secondary market and implementing the aforesaid scheme for benefit of the employees of the Company.

The Company had provided a loan to Employee Benefit Trust for purchasing shares of the Company, of which balance outstanding as at 31st March, 2018 was Rs. 12.96 Crores (Previous Year: Rs. 14.41 Crores), net of Rs. 0.04 Crores (Previous Year: Rs. 0.04 Crores) representing face value of 85,828 equity shares held by them as at 31st March, 2018 (Previous Year: 85,828 equity shares).

Note 7

CORRECTION OF ERROR IN ACCOUNTING FOR SHARES HELD BY EMPLOYEE BENEFIT TRUST

During the current year, after a detailed review of the Employee Benefit Scheme, the management has corrected the accounting for its own shares held by Employee Benefit Trust. Accordingly, shares held by âTide Water Oil Company (India) Limited Employee Benefit Trustâ of face value Rs. 0.04 Crores as at 31st March, 2017 (1st April, 2016: Rs. 0.04 Crores) has been netted from Paid-up Equity Share Capital and Rs. 14.41 Crores as at 31st March, 2017 (1st April, 2016: Rs. 15.66 Crores) has been netted from Other Equity of the Company. Earnings Per Equity Share for the previous year has accordingly been restated. There is no other impact in the Statement of Profit and Loss or the Cash Flow Statement.

Note 8 SEGMENT INFORMATION

The Company''s reportable business segment consists of a single segment of âLubricantsâ in terms of Ind AS 108.

Entity-wide Disclosures:-

(i) The Company is domiciled in India. The amount of its revenue from external customers broken down by location of the customers is shown below:

(ii) All non-current assets of the Company (excluding Financial Assets) are located in India.

(iii) No customer individually accounted for more than 10% of the revenues from external customers during the years ended 31st March, 2018 and 31st March, 2017.

Mar 31, 2017

The Authorized Share Capital of the Company is Rs.20.00 Crores comprising 4,00,00,000 Ordinary shares of Rs.5/- each

Details of Equity Shares held by Shareholders holding more than 5% of the aggregate shares in the Company :

The Company has elected to recognize changes in the fair value of certain investments in equity instruments in Other Comprehensive Income. These changes are accumulated within Equity. The Company transfers amounts from this balance to retained earnings when the relevant equity instruments are derecognized.

(b) Non - cancellable operating leases

The company leases various offices, warehouses and plants under non cancellable operating leases. The leases have varying terms, escalation clauses and renewal rights. On renewal, the terms of leases are negotiated.

1. Proposed Dividend Equity Shares

Final Dividend for the year ended 31^st March 2016 of Rs. 30.49 Crores (31^st March 2015 Rs.21.78 Crores)

Interim Dividend for the year ended 31^st March 2016 of Rs. 13.07 Crores (31^st March 2015 Rs. 8.71Crores)

In addition to the above dividends, since year end the directors have recommended the payment of a final dividend of Rs. 100 per fully paid equity share (31^st March 2016- Rs. 87.50). This proposed dividend is subject to the approval of shareholders in the ensuing general meeting.

2. Employee Benefits:

(I) Leave Obligations

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilized leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

The amount of the provision of Rs. 3.34 Crores (31^st March 2016- Rs. 2.52 Crores) is presented as current, since the Company does not have any unconditional right to defer settlement for any of these obligations.

(II) Post employment obligations - Defined Benefit Plans

(A) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Company does not fully fund the liability and maintains a target level of funding to be maintained over a period of time based on estimations of expected gratuity payments. The plan is being managed by a separate Trust created for the purpose and obligations of the company is to make contribution to the Trust based on acturial valuation. The scheme is funded.

(B) Post- retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

The Company has a defined benefit pension fund. The Scheme is unfunded. This is not applicable to members in employment at present.

Notes:

(a) The estimate of future salary increases takes into account inflation, seniority, promotion and other relevant factors, such as demand and supply in the employment market.

(b) The expected return on plan assets is determined after taking into consideration composition of the plan assets held, assessed risks of asset management, historical results of the return on plan assets, the Companyâs policy for plan asset management and other relevant factors.

The above Sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated. When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method (present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting period) has been applied as when calculating the defined benefit liability recognized in the balance sheet.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to the prior period.

(h) Category of Plan Assets: The Company has not received any break up of the compositions of investments by category with respect to gratuity fund managed by LIC, hence disclosure required, has not been given.

(i) Risk Exposure

The Company is exposed to a number of risks through the defined benefit plans. The most significant of which are detailed below:-

Funded

Superannuation Fund - This is a defined contribution fund, so there is no material risk.

Gratuity

i) Credit Risk:

The scheme is insured and fully funded on Projected United Credit Method (PUC) basis. There is a credit risk to the extent the insurer is unable to discharge its obligations including failure to discharge in timely manner.

ii) Discount Rate Risk

The Company is exposed to the risk of fall in discount rate. A fall in discount rate will eventually increase in the ultimate cost of providing the above benefit thereby increasing the value of the liability.

iii) Regulatory Risk:

Gratuity Benefit must comply with the requirements of the Payment of Gratuity Act, 1972. There is a risk of change in the regulations requiring higher gratuity payments.

iv) Future Salary Increase Risk:

The scheme cost is very sensitive to the assumed future salary escalation rates for all salary defined benefit schemes. If actual future salary escalations are higher than that assumed in the valuation actual scheme cost and hence the value of the liability will be higher than that estimated.

v) Investment Risk

If Plan is funded then assets liabilities mismatch and actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.

Non-funded

Leave encashment, Medical and Pension.

i) Discount Rate Risk

ii) Future Salary Increase Risk:

iii) Life expectancy:

The pension and medical plan obligation are to provide benefits for the life of the member, so increases in life expectancy will result in an increase in the planâs liability.

iv) Pay-as-you-go Risk:

For unfunded schemes financial planning could be difficult as the benefits payable will directly affect the revenue and this could be widely fluctuating from year to year.

v) Withdrawals

Actual Withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rate at subsequent valuation can impact plans liability.

(j) Defined Benefit Liability and Employer Contributions

Gratuity is funded with LIC. Contribution is made annually to match with the obligation. As per policy of the Company, leave encashment and medical are paid from companyâs reserve fund.

Expected contributions to Post-employment benefit plans for the year ending 31^st March 2018 are Rs. 3.10 Crores.

The weighted average duration of the defined benefit obligation is 15 years (March 31, 2016 - 15 years). The expected maturity analysis of undiscounted gratuity, leave encashment and post employment medical benefits is as follows:-

(III) Post employment obligations - Defined Contribution Plans

The Company has certain Defined Contribution Plans viz. Provident Fund and Superannuation Fund. Contributions are made to provident fund in India for employees at the rate of 12% of basic salary as per regulations. The Company has a defined contribution Superannuation plan for which contribution is made at a rate not exceeding 4.87% of Basic and Dearness Allowance of the member with Superannuation. The contributions are made to registered provident fund administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation. The expense recognized during the period towards defined contribution plan is Rs. 3.77 Crores (31^st March 2016- 3.50 Crores)

C. Terms and Conditions

1 Remuneration was paid as per service contract.

2 Directorâ Fees and sports sponsorship were paid as per board resolution.

3 Transaction relating to payment of dividend was on same terms and conditions that applied to other share holders.

4 All other transactions were made on normal commercial terms and conditions and at market rates.

5 All outstanding balances are unsecured and are repayable in cash.

The Company obtains independent valuations for its investment properties at least annually. The best evidence of fair value is current prices in an active market for similar properties. Where such information is not available, the Company considers the current prices in an active market for properties of different nature or recent prices of similar properties in less active market, adjusted to reflect those differences

The fair values of investment properties have been determined by K.B.S. Associates Private Limited and Sunil Dawalkar both are approved valuer.

3. Corporate Social Responsibility

Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof:

i. Gross Amount required to be spent by the Company during the year (2% of the Average Net Profit) Rs. 2.18 Crores

ii. Amount spent during the year ended :

4. The disclosure under the Micro, Small & Medium Enterprise Development Act, 2006 have been made on the basis of confirmations received from suppliers regarding their status under the said Act;

* Specified Bank Notes are as defined in the notification of the Government of India, Ministry of Finance, department of Economic Affairs No. S.O. 3407(E), dated 08th November 2016

5. The Company had instituted Tide Water Oil Co. (India) Ltd. Employee Welfare Scheme as approved by shareholders vide postal ballot dated 2^nd March, 2011. Subsequent to promulgation of Securities Exchange Board of India (Share Based Employee Benefits Regulations), 2014 the shareholders vide their postal ballot resolution dated 14^th January, 2016, aligned the provisions of the aforesaid scheme with that of the said regulations. The scheme had also been rechristened as Tide Water Oil Company (India) Limited Employee Benefit Scheme. No option has been granted during the year, under this scheme.

The scheme continues to be administered by an independent Trust viz., Tide Water Oil Company (India) Limited Employee Benefit Trust (erstwhile Tide Water Oil Co. (India) Ltd. Employee Welfare Trust). The objective of the trust was acquiring shares from the secondary market and implementing the aforesaid scheme under the aforesaid scheme.

6. Bonus shares have been issued in 1:1 ratio during the year ended 31^st March 2016 by the Company to the eligible members of the Company holding ordinary shares of Rs.5/- each.

7. (a) The Company has incurred revenue expenditure of Rs. 1.44 Crores (previous year Rs. 1.47 Crores) on account of Research & Development expenses the break up of which is as follows :

(b) The Gross Block of Property, Plant and Equipment in Note 3 includes the following assets purchased for Research & Development:

8. To give a narrative description of any changes in Income tax rate Not Applicable - since there is no change

9. The Company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities related to income taxes levied by the same tax authority.

10. At 31^st March 2017, there was no recognized deferred tax liability (31^st March 2016:INR Nil and 1^st April 2015:INR Nil) for taxes that would be payable on the unremitted earnings of the Companyâs subsidiaries. The Company has determined that undistributed profits of its subsidiaries will not be distributed in the foreseeable future.

11. During the year ended 31^st March 2017 and 31^st March 2016, the Company has paid dividend to its shareholders. This has resulted in payment of DDT to the taxation authorities. The Company believes that DDT represents additional payment to taxation authority on behalf of the shareholders. Hence DDT paid is charged to equity.

12. First-time adoption of Ind AS

These are the Companyâs first financial statements prepared in accordance with Ind AS.

The accounting policies set out in note 2, have been applied in preparing the financial statements for the year ended 31^st March, 2017, the comparative information for the year ended 31^st March, 2016 and in preparation of an opening Balance Sheet as at 1^st April, 2015. In preparing its opening Balance Sheet, amounts reported previously in financial statements have been adjusted suitably. An explanation of how a transition from the previous GAAP to Ind AS has affected the groupâs financial position, financial performance and cash flows is set out in the following tables and notes:

13. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

14. Ind AS Optional Exemptions

15. Business combination

Ind AS 101 permits a first time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. The exemption can also be used for intangible assets covered under Ind AS 38 Intangible Assets and investment property covered by Ind AS 40 Investment Properties.

Accordingly the Company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their previous GAAP carrying value.

16. Cumulative translation differences

Ind AS 101 permits cumulative translation gains and losses to be reset to zero at the transition date. This provides relief from determining cumulative currency translation differences in accordance with Ind AS 21 from the date a subsidiary or equity method investee was formed or acquired.

In line with the above, all such gains and losses have been set to zero.

17. Deemed cost

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment, measured as per the previous GAAP and use that as its deemed cost at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38.

Accordingly, the Company has elected to measure all of its property, plant and equipment, intangible assets and investment property at their previous GAAP carrying value.

18. Designation of previously recognized financial instruments

Ind AS 101 allows an entity to designate investments in equity instruments at FVOCI on the basis of facts and circumstances at the date of transition to Ind AS.

The entity has elected to apply this exemption for its investments.

19. Leases

Ind AS requires an entity to assess whether a contract or arrangement contains a lease. This assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS.

The entity has elected to apply this exemption.

20. Joint venture

Ind AS 101 provides an exemption for changing from proportionate consolidation to the equity method. As per the exemption, when changing from proportionate consolidation to the equity method, an entity should recognize its investment in the joint venture at transition date to Ind AS. The initial investment should be measured based on the carrying amount of assets and liabilities that have been consolidated earlier. The balance of the investment in joint venture at the date of transition to Ind AS is regarded as deemed cost of the investment.

The entity has elected to apply this exemption.

21. Ind AS mandatory exceptions

22. Estimates

An entityâs 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 previous GAAP.

Ind AS estimates at 1^st April, 2015 are consistent with the estimates as at the same date made with conformity with previous GAAP.

23. De-recognition of financial assets and liabilities

Ind AS 101 requires a first-time adopter to apply the de-recognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition retrospectively from a date of entityâs choosing.

The entity has elected to apply the de-recognition provisions prospectively from the date of transition.

24. Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of assets on the basis of facts and circumstances that exist at the date of transition to Ind AS.

The entity has applied this exception.

25. Fair valuation of investments

Under the previous GAAP, investments were classified as long term investments or current investments based on the intended holding period and realisability. Under Ind AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments have been recognized in retained earnings as at the date of transition.

26. Deferred tax

Under previous GAAP, tax expense in the financial statement was computed by performing line by line addition of tax expense. Under Ind AS, deferred taxes are also recognized on undistributed profits of joint ventures and associates.

27. Trade receivables

The Company applies the simplified approach of recognizing the expected losses from initial recognition of the receivables on case to case basis as provision for impairment.

28. Investment property

Under the previous GAAP, investment properties were presented as part of fixed assets. Under Ind AS, these are required to be separately presented on the face of Balance Sheet.

29. Bank overdrafts

Under Ind AS, bank overdrafts repayable on demand are included in cash and cash equivalents for the purpose of presentation of statement of cash flows. Under previous GAAP, bank overdrafts were considered as part of borrowings.

30. Proposed dividend

Under the previous GAAP, dividends proposed by the Board of Directors after the Balance Sheet date, before the approval of the financial statements were considered as adjusting events. Under Ind AS, such dividends are recognized when the same is approved by shareholders in the general meeting.

31. Excise duty

Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented as part of expenses.

32. Remeasurements of post-employment benefit obligations

Under the Ind AS, actuarial gains and losses and the return on plant assets, are recognized in other comprehensive income. Under the previous GAAP, they were forming part of the profit and loss for the year.

33. Reconcilliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

34. Reconcilliation of equity as at date of transition (1^st April 2015) and as at 31^st March 2016

35. Business Combinations

a) Summary of acquisition

On 29^th April, 2016 the Company acquired 100% of the issued share capital of Price Thomas Holdings Ltd, a parent company of Granville Oil & Chemicals Ltd, a manufacturer of lubricant oil. This acquisition will enable the Company to enter into the lubricant oil market in UK.

(i) Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are (a) recognized and measured at fair value and (b) measured at amortized cost and for which fair values are disclosed in the financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the group has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

Level 1

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

Level 2

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

Level 3

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

(i) Valuation technique used to determine fair value

Specific valuation techniques used to value financial instruments include:

- the use of quoted market prices or dealer quotes for similar instruments

- the fair value of the remaining financial instruments is determined using discounted cash flow analysis.

(ii) Fair value measurements using significant unobservable inputs(level3)

The following table presents the changes in level 3 items for the periods ended 31^st March 2017 and 31^st March 2016 :

36. Based on the synergies, risks and returns associated with business operations and in terms of Ind AS - 108, the Group is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of Ind AS - 108 on Segment Reporting are not applicable.

37. The management is of the opinion that no case of impairment of asset exist under the provision of Ind AS - 36 on Impairment of Assets as at 31.03.2017.

38. Previous year figures have been regrouped / reclassified to conform to this yearâs classification and have been regrouped and rearranged wherever necessary to make it comparable with the current year figures.

Mar 31, 2016

1. Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 4.40 Crores (previous year Rs. 1.31 Crores).

2. The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2016.

3. Corporate Social Responsibility

Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof :

a. Gross amount required to be spent by the Company during the year (2% of Average Profit) Rs.1.94 Crores.

b. Amount spent during the year Rs. 0.78 Crores.

4. The Company had instituted Tide Water Oil Co. (India) Ltd. Employee Welfare Scheme as approved by shareholders vide postal ballot dated 2nd March, 2011. Subsequent to promulgation of Securities Exchange Board of India (Share Based Employee Benefits Regulations), 2014 the shareholders vide their postal ballot resolution dated 14th January, 2016, approved the alignment of the provisions of the aforesaid scheme with that of the said regulations. The scheme had also been rechristened as Tide Water Oil Company (India) Limited Employee Benefit Scheme. No option has been granted during the year, under this scheme.

The scheme continues to be administered by an independent Trust viz., Tide Water Oil Company (India) Limited Employee Benefit Trust (erstwhile Tide Water Oil Co. (India) Ltd. Employee Welfare Trust). The objective of the trust was to acquire shares from the secondary market and implement the aforesaid scheme.

In terms of regulation of Securities Exchange Board of India (Share Based Employee Benefits Regulations), 2014 and as per opinion of the Expert Advisory Committee of Institute of Chartered Accountants of India, the balance loan amounting to Rs.15.70 Crores (Previous year Rs 16.50 Crores) to the aforesaid Trust in the books of the Company has been eliminated against loan paid to the Trust by means of book adjustment only.

Therefore 85,828 (previous year 21,457) nos. of equity shares held in trust for employees under the ESOP scheme as on 31st March 2016, amounting Rs 15.70 Crores (previous year Rs 15.59 Crores) has been shown as deduction from Share Capital to the extent of face value of equity shares Rs 0.04 Crores (previous year Rs 0.02 Crores) and Securities Premium Reserve to the extent of Rs 3.52 Crores (previous year Rs 4.39 Crores) and remaining balance amount has been shown as deduction from General Reserve to the extent of Rs 12.13 Crores (previous year Rs 11.18 Crores).

Since the financial result of the Trust is included in standalone financial statements of the Company, the notional accumulated deficit of the trust amounting Rs 0.001 Crores (previous year Rs 0.91 Crores) arising from the operation of the Trust till 31st March 2016 has been adjusted with âSurplusâ of the Company.

5. The Authorized Share Capital of the Company has been increased during the year from Rs. 3.00 Crores divided into 30,00,000 ordinary shares of Rs. 10/- each to Rs.20.00 Crores comprising 4,00,00,000 Ordinary Shares of Rs. 5/- each.

During the year, the Company has subdivided its 871,200 ordinary shares of Rs 10/- each into 17,42,400 ordinary shares of Rs. 5/- each.

Further, Bonus shares have been issued during the year by the Company to the eligible members of the Company holding ordinary shares of Rs.5/- each (ratio 1:1) by capitalizing Rs. 0.87 Crores out of the sum standing to the credit of companyâs Securities Premium Reserve.

The above had been approved by the shareholders of the Company on 7th March, 2016 and record date was fixed as 17th March, 2016.

6. Cost of Material consumed includes Rs. 1.32 Crores being loss of inventory arising out of fire at depot located at Ahmadabad. Other Non Operating income includes insurance claim of Rs. 1.26 Crores received towards above loss.

7. The diminution in value of Long Term quoted Investments amounting to Rs. 0.41 Crores (previous year Rs. 0.41 Crores) is in the opinion of the management, not of a permanent nature and accordingly no provision has been made.

8. Employees Benefits :

(a) The Company''s contribution to Defined Contribution Plans aggregated to Rs. 3.50 Crores (previous year Rs. 3.29 Crores) for the year ended has been recognized under the line item Contribution to Provident and Other Funds on Note 19 above.

(b) Defined Benefit Plans

(i) Gratuity

(ii) Post-retirement Medical Scheme

(iii) Compensated absences

(iv) Superannuation

The Company has a defined contribution Superannuation plan for which contribution is made at a rate not exceeding 4.87% of Basic and Dearness Allowance of the member with Superannuation. The Scheme is funded

(v) Pension

The Company has a defined benefit pension fund. The Scheme is unfunded. This is not applicable to members in employment at present.

9. The disclosure under the Micro, Small & Medium Enterprise Development Act, 2006 have been made on the basis of confirmations received from suppliers regarding their status under the said Act;

10. Disclosures pertaining to Segment Reporting as per AS-17

Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard -17, the Company is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of AS 17 on Segment Reporting are not applicable to the company.

11. Previous year figures have been regrouped / reclassified to conform to this year''s classification and have been regrouped and rearranged wherever necessary to make it comparable with the current year figures.

Mar 31, 2015

Notes : 1. The Cash Flow Statement has been prepared under the "Indirect Method" as set out in Accounting Standard-3 on Cash Flow Statement issued by ICAI.

2. Cash and Cash Equivalent represent Cash and Bank Balances.

3. Additions to Fixed Assets are stated inclusive of movements of Capital Work-in-Progress between the beginning and end of the year and are treated as part of Investing Activities.

In terms of our report attached

NOTE 3 SHORT TERM LOANS & ADVANCES (UNSECURED)

Advance Payment of Tax and credits in respect of tax paid at source (net of Provision)

Advances recoverable in cash or in kind or for value to be received * Considered Good Considered Doubtful

3.1 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 1.31 Crores (previous year Rs. 1.01 Crores).

3.2 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31st March, 2015.

3.3 Corporate Social Responsibility

Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof :

a. Gross amount required to be spent by the Company during the year (2% of Net Profit) Rs. 1.89 Crores.

b. Amount spent during the year Rs. 0.57 Crores.

3.4 Pursuant to the enactment of Companies Act, 2013, the Company has applied the estimated useful lives as specified in Schedule II in respect of Tangible Assets. Accordingly, carrying amount is being depreciated or amortized over the remaining useful lives. The written down value of the fixed assets whose lives expired as at 1st April, 2014, have been adjusted, in the opening balance of General Reserve amounting to Rs. 2.29 Crores. The residual value of assets has been taken as nil.

In view of change in depreciation method from written down value to straight line method, depreciation for the year ended 31st March, 2015 is higher by Rs. 2.71 Crores and effect relating to the period prior to the 1st April, 2014 is Rs. 30.20 Crores, which has been shown as the ''Exceptional Item'' for the year ended 31st March, 2015.

3.5 During the year, the Company has entered into a Joint Venture agreement with JX Nippon Oil & Energy Corporation, Japan to form a Joint Venture Company to manufacture and sell lubricants under the brand name ''ENEOS''.

In pursuance of this joint venture agreement, a new Joint Venture Company named JX Nippon TWO Lubricants India Pvt. Ltd. was incorporated on 8th August, 2014.

Further, the Company has transferred ''Business Undertaking'' pertaining to Eneos business pursuant to the ''Business Transfer Agreement'' to JX Nippon TWO Lubricants India Pvt. Ltd. on 1st October, 2014 for a lump sum consideration of Rs.108 Crores as Slump Sale.

As a result of this transaction, a long term capital gain has accured during the year and has been shown as an ''exceptional item'' in the Statement of Profit & Loss.

3.6 During the year, the Company has transferred a land and building at Royapuram, Chennai on 9th October, 2014 at a lump sum consideration of Rs. 13.12 Crores.

As a result of this transaction, a long term capital gain has accured during the year and shown as an ''exceptional item'' in the Statement of Profit & Loss.

3.7 The Company had instituted a Tide Water Oil Company (India) Limited Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March 2011 for allotment of stock options to employees. The Scheme was kept in abeyance during the year.

The scheme was being administered by an independent Tide Watre Oil Co. (India) Ltd. Emplyee Welfare Trust (TWOC- EWT). The objective of the trust was acquiring shares from the secondary market and implementing the aforesaid scheme under the TWOC-EWS 2010-11.

In terms of clause 22A.1 of SEBI guideline 1999. "in case of ESOS/ESPS administered through a Trust, the accounts of the Company shall be prepared as if the company itself is administrating the ESOS/ESPS" and as per opinion of the Expert Advisory Committee of Institute of Chartered Accountants of India, the balance loan amounting to Rs. 16.50 Crores (Previous year Rs. 17.00 Crores) to TWOC-EWT in the books of the Company has been eliminated against loan paid to TWOC-EWT by means of book adjustment only.

Therefore 21,457 (previous year 21,457) nos. of equity shares held in trust for employees under the ESOP scheme as on 31 st March 2015, amounting Rs. 15.59 Crores (previous year Rs. 15.39 Crores) has been shown as deduction from Share Capital to the extent of face value of equity shares Rs. 0.02 Crores (previous year Rs. 0.02 Crores) and Securities Premium Reserve to the extent of Rs. 4.39 Crores (previous year Rs. 4.39 Crores) and remaining balance amount has been shown as deduction from General Reserve to the extent of Rs. 11.18 Crores (previous year Rs. 10.98 Crores).

Since the financial result of TWOC-EWT is included in standalone financial statements of the Company, the notional accumulated deficit of ESOP trust amounting Rs. 0.91 Crores (previous year Rs. 1.61 Crores) arising from the operation of the TWOC-EWT till 31st March 2015 has been adjusted with ''Surplus'' of the Company.

(d) Key Managerial Personnel

Mr. R. N. Ghosal, Managing Director Mr. S. Basu, Chief Financial Officer Mr. S Ganguli, Company Secretary

(e) Relative of Key Managerial Personnel

Mr. Saurav Ghosal, son of Mr. R. N. Ghosal

(B) Transactions with Related parties during the Financial year and outstanding balances are as below :

3.8 Employees Benefits :

(a) The Company''s contribution to Defined Contribution Plans aggregated to Rs.3.29 Crores (previous year Rs. 2.56 Crores) for the year ended has been recognised under the line item Contribution to Provident and Other Funds on Note 18 above.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(iii) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number of days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

(iv) Superannuation

Superannuation Scheme was provided in the accounts by the Company as Defined Benefit Retirement plan till 31st March, 2013.Now in view of policy of the Company and to reduce the risk due to Defined Benefits (DB) plan assets that may fall short of what is required to meet the obligations at the time of employee''s retirement, the Company has changed the remuneration policy as per board meeting dated 31.07.2013.

As per change in remuneration policy with effect from 1st August, 2007, the Scheme stands altered from Defined Benefit (DB) Scheme to a Defined Contribution (DC) Scheme. Consequently, with effect from 1st August,2007, the amount shall be calculated as under :

The sum accumulated in the name of the eligible members shall be calculated at the rate of 15% of basic salary upto 31st July, 2007. This shall, thereafter, be increased by the contribution by the Company with effect from 1st August, 2007, calculated at a rate not exceeding 4.87% of Basic and Dearness Allowance of the member till his date of superannuation. The Scheme is funded.

(v) Pension

The Company has a defined benefit pension fund. The Scheme is unfunded. This is not applicable to members in employment at present.

Notes :

(i) According to the Actuary, there will be no change in the aggregate of the current service cost and interest cost components of net periodic post employment medical cost for one percentage point increase or decrease in the assumed medical cost trends.

(ii) The Company has not received any break-up of the compositions of investment by category with respect to Gratuity Fund and Superannuation Fund administered and managed by Life Insurance Corporation of India and hence disclosure required for compositions of investment for plan assets under Accounting Standard 15 on Employee Benefits have not been given.

(iii) The estimate of future salary increases take into account inflation, seniority, promotion and other relevant reasons.

3.9 The disclosure under the Micro, Small & Medium Enterprise Development Act, 2006 have been made on the basis of confirmations received from suppliers regarding their status under the said Act :

2.10 Disclosures pertaining to Segment Reporting as per AS-17

Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard - 17, the Company is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of AS 17 on Segment Reporting are not applicable to the company.

3.11 Contribution to political party amounting to Rs. 0.01 Crores (Previous year NIL).

3.12 Previous year figures have been reclassified to conform to this year''s classification and have been regrouped and rearranged wherever necessary to make it comparable with the current year figures.

Mar 31, 2013

1.1 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 0.61 Crores (previous year Rs. 2.43 Crores).

1.2 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2013.

1.3 The Company''s significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The aggregate lease rentals charged to the Statement of Profit and Loss are Rs. 0.79 Crores (previous year Rs. 0.78 Crores). Expected future minimum commitments under such leases are shown below :

1.4 The Company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March 2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs.17.00 Crores to TWOC-EWT towards proposed purchase of Company''s shares from the market.

1.5 Loans and advances include Rs.3.48 Crores (previous year Rs.3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited(YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 Crores and the corresponding provision, if any, as may be required is not ascertainable at this stage.

1.6 The diminution in value of Long Term Investments amounting to Rs. 0.60 Crores (previous year Rs. 0.60 crores) is in the opinion of the management, not of a permanent nature and accordingly no provision has been made.

1.7 The details of transactions entered into with Related parties during the year are as follows :

(A) Name of Related parties :

(a) Subsidiary Companies

i) Veedol International Limited

ii) Veedol International DMCC

iii) Veedol International BV

(b) Associated Companies

i) Andrew Yule & Co. Ltd.

ii) Standard Greases & Specialities Pvt. Ltd.

(c) Key Managerial Personnel

Mr. R. N. Ghosal, Managing Director

(d) Relative of Key Managerial Personnel

Mr. S. Ghosal, son of Mr. R. N. Ghosal

1.8 Employees Benefits :

(a) The Company''s contribution to Defined Contribution Plans aggregated to Rs.2.15 Crores (previous year Rs. 1.57 Crores) for the year ended has been recognised under the line item Contribution to Provident and Other Funds on Note 19 above.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.8% to 2.2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

1.9 Disclosures pertaining to Segment Reporting as per AS-17

Based on the synergies, risks and returns associated with business operations and in terms of Accounting Standard - 17, the Company is predominantly engaged in the business of a single reportable segment of Lubricants during the year. Therefore disclosure requirements of AS 17 on Segment Reporting are not applicable to the company :

1.10 The Ministry of Corporate Affairs, Government of India, vide General Circular No.2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act,1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

1.11 Previous year figures have been reclassified to conform to this year''s classification and have been regrouped, recast and rearranged wherever necessary to make it comparable with the current year figures.

Mar 31, 2012

1.1 Contingent Liabilities

Contingent Liabilities not provided for : 31st March, 2012 31st March, 2011 (Rs.in crores) (Rs.in crores)

a. Bills Discounted 42.88 33.54

b. Income Tax 2.46 1.95

c. Sales tax / VAT 2.18 1.91

d. Excise Demands 0.65 0.65

e. Navi Mumbai Municipal Corporation cess 1.36 0.20

f. Bank Guarantees 0.05 0.05

g. Fringe Benifit tax 0.01 0.01

h. Other guarantees given to banks against 5.12 - financial facilities availed by subsidiaries

1.2 Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 2.43 crores (previous year Rs. 3.58 crores).

1.3 The company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2012.

1.4 The Company's significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The aggregrate lease rentals charged to the Statement of Profit and Loss are Rs. 0.78 crores (previous year Rs. 0.73 crores). Expected future minimum commitments under such leases are shown below :

1.5 The company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March,2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs. 17 Crores to TWOC-EWT towards proposed purchase of Company's shares from the market.

Mar 31, 2011

1. CONTINGENT LIABILITIES

31st March, 2011 31st March, 2010

Contingent Liabilities not provided for:

Rs. Rs.

a. Bills Discounted 33.54 29.98

b. Income Tax 1.95 3.34

c. Sales tax/VAT 1.91 2.09

d. Excise Demands 0.65 0.65

e. Other disputed claims 0.20 0.20

f. Bank Guarantees 0.05 0.08

2. The Company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2011.

3. The Companys significant leasing arrangements are primarily in respect of operating leases for office premises. These leasing arrangements which are non-cancellable are usually renewable on mutually agreeable terms. The agreeable lease rentals charged to the profit and loss account are Rs. 0.73 (last year Rs. Nil). Expected future minimum commitments under such leases are shown below.

4. The company has instituted a Tide Water Oil Company (India) Limited-Employee Welfare Scheme (TWOC-EWS 2010-11) as approved by the Board of Directors and the Shareholders vide a special resolution by postal ballot on 2nd March,2011 for allotment of stock options to employees.

The scheme is administered by an independent Tide Water Oil Co.(India) Ltd. Employee Welfare Trust (TWOC-EWT). The purpose of the Trust is acquiring shares from the secondary market and implementing the scheme under the TWOC-EWS 2010-11.

The Company has given interest bearing loan amounting Rs. 17 Crores to TWOC-EWT towards proposed purchase of Companys shares from the market.

5. Loans and advances include Rs. 3.48 Crores (last year Rs. 3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited (YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 Crores and the corresponding provision, if any, as may be required is not ascertainable at this stage.

6. The diminution in value of Long Term Investments amounting to Rs. 0.60 Crores (last year Rs. 0.60 Crores) is in the opinion of the management, not of a permanent nature and accordingly no provision has been made.

7. Related Party Disclosures

(a) Key Managerial Personnel

Mr. R.N. Ghosal, Executive Director of the Company is considered as Key Managerial Personnel.

(b) Relative of Key Managerial Personnel Mr. S.Ghosal, son of Mr. R.N. Ghosal

(c) Associate Companies AndrewYule&Co.Ltd.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act, 1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.8% to 2.2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

8. Figures for the previous year have been rearranged / regrouped wherever necessary, to conform to current year classifications.

Mar 31, 2010

1. CONTINGENT LIABILITIES

Contingent Liabilities not provided for :

31st March, 2010 31st March,2009

Rs. Rs.

a. Bills Discounted 29.98 22.65

b. Income Tax 3.34 7.60

c. Sales tax/VAT 2.09 1.43

d. Excise Demands 0.65 0.53

e. Other disputed claims Nil 0.02

f. Bank Guarantees 0.08 0.08

2. Estimated amount of contracts (net of advances) remaining to be executed on capital account and not provided for is Rs. 2.44 Crores (last year Rs. 8.16 Crores).

3. During the year, Company has started a new line of business of sale of Wind Power to Tamil Nadu Electricity Board (TNEB). Two Power Generation units of 1.5 MW each, have been set up at Sankenari, Tamil Nadu, which has been commissioned and connected to TNEB grid.

The company has an agreement with Suzlon Energy Ltd. for operation and maintenance of the power units.

4. The Company has reviewed the impairment of assets at year end and noted that none of the assets has been impaired as on 31.03.2010.

5. Loans and advances include Rs.3.48 Crores (last year Rs3.48 Crores) given as advance towards proposed issue of shares by Yule Agro Industries Limited (YAIL). In view of the present status of activities of YAIL, shares have not been issued. Hence the status of recoverability of the aforesaid advance of Rs. 3.48 and the corresponding provision, if any, as may be required is not ascertainable at this stage.

(b) Defined Benefit Plans

(i) Gratuity

The Company has an obligation towards gratuity, a defined benefit retirement plan covering eligible employees as per Payment of Gratuity Act,1972. The plan provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment of an amount as per Payment of Gratuity Act, 1972. Vesting occurs upon completion of five years of service. The Scheme is funded.

(ii) Superannuation

Employees who are members of the defined benefit superannuation plan are entitled to benefits depending on the years of service and salary drawn. The monthly pension benefits after retirement range from 1.67% to 2% of salary drawn. The Scheme is funded.

(iii) Pension

The Company has a defined benefit pension fund. No new members are admitted to this Scheme. The Company accounts for the liability for pension benefits based on year-end actuarial valuation. The Scheme is unfunded.

(iv) Post-retirement Medical Scheme

Under this scheme, employees get medical benefits subject to certain limits of amount and types of benefits depending on their grade at the time of retirement. The liability for post-retirement medical scheme is determined on the basis of year-end actuarial valuation. The Scheme is unfunded.

(v) Compensated absences

The Company provides for the encashment of leave or leave with pay subject to certain rules. The employees are entitled to accumulate leave subject to certain limits, for future encashment. The liability is provided based on the number days of unutilised leave at each balance sheet date on the basis of year-end actuarial valuation. The Scheme is unfunded.

Notes :

(i) According to the Actuary, there will be no change in the aggregate of the current service cost and interest cost components of net periodic post employment medical cost for one percentage point increase or decrease in the assumed medical cost trends.

(ii) The Company has not received any break-up of the compositions of investment by category with respect to Gratuity Fund and Superannuation Fund administered and managed by Life Insurance Corporation of India and hence disclosure required for compositions of investment for plan assets under Accounting Standard 15 on Employee Benefits have not been given.

(iii) The estimate of future salary increases take into account inflation, seniority, promotion and other relevant reasons.

6. Figures for the previous year have been rearranged /regrouped wherever necessary, to confirm to current year classifications.

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