1 contingent liabilities not provided for:
 
                                         As at 31 March  As at 31 March 
                                                   2011            2010 
                                           (Rs million)    (Rs million)
  
 (a) Claims not acknowledged as debt             50              50
 
 (b) Sales tax matters under appeal             129             109
 
 (c) Excise matters in dispute / under appeal    85              50
 
 (d) Industrial relations and other matters 
     under dispute                                2               2
 
 (e) Income tax matters in dispute / under 
     appeal 
 
 (f) Any other matter                             -             128
 
 
 * The Income tax assessments for the Company have been completed up to
 the financial year ended 31 March 2007.  Arising from the completed
 assessments and appellate orders, the demands aggregate Rs 1545 million
 (2009-10 : Rs 1378 million), and the total refunds aggregate Rs 1356
 million (2009-10 : Rs 1105 million). The Company as well as the Income
 tax department have fled appeals on these matters. Pending decision in
 the appeals, neither the refunds nor the liability for the demands have
 been recognised in the accounts.
 
 2 Sale of National Starch business
 
 (i) The Company sold its National Starch (Specialty Starches) business
 on a slump sale basis, on 30 December 2010, to C P Ingredients India
 Private Limited for a consideration of Rs 133 million, inclusive of
 working capital transferred and other adjustments as per the Business
 Transfer agreement concluded between the two parties.
 
 (ii) Profit on sale of the business of Rs.113 million, after adjusting
 the assets transferred of Rs. 17 million and related transaction cost
 of Rs. 3 million, has been shown as Exceptional item in Profit and
 Loss Account.
 
 (iii) The National Starch business was not treated as a separate
 reportable segment, being classified as Others in Segment Information
 (Note 17 of Schedule 18). Since the business did not represent a major
 line of business, the disposal has not been treated as a discontinuing
 operation under Accounting Standard AS 24 for the purpose of disclosure
 requirements under the Standard.
 
 (iv) The Company received Rs. 171 million as advance in respect of the
 sale of the above business from the buyer. Excess consideration
 received amounting to Rs. 38 million has been included under Current
 Liabilities as creditors.
 
 3 Income from investments, interest and others are stated at gross
 amounts. The amount of income tax deducted aggregates Rs 2 million
 (2009-10 : Rs 4 million).
 
 4 Loss on account of foreign exchange fluctuations for the year is Rs
 11 million, included in Sundries in schedule 14 (2009-10 : Gain of Rs 8
 million included in Miscellaneous receipts in schedule 12)
 
 Footnotes :
 
 1.  N. A. - Not Applicable.
 
 2.  Production meant for sale is after adjustment of shortages,
 handling losses, quantity internally consumed.
 
 3.  Licensed and installed capacity in respect of intermediates, used
 entirely for captive consumption, have not been furnished.
 
 4.  All items are delicensed.
 
 5.  Installed capacities are as certified by the management.
 
 6.  Installed capacity of Catalysts is utilised for toll conversion
 operations undertaken on behalf of Johnson Matthey Chemicals India
 Private Limited and, therefore, quantity processed has not been
 included in actual production.
 
 *Notes
 
 (a) Provisions relating to indirect taxes are in respect of proceedings
 of various sales tax, excise duty, customs duty and other indirect tax
 cases, including those relating to discontinued businesses. Outflows in
 all these cases, including their timing and certainty, would depend on
 the developments/outcome in these cases.
 
 (b) Provisions relating to divested businesses (other than any indirect
 tax cases relating to such businesses) are in respect of existing /
 anticipated costs arising from divestment of businesses (Catalyst,
 Explosives, Rubber Chemicals, Uniqema, Paints Advanced Refinish and
 Adhesive business) and subsidiaries (Quest International India Limited
 and Polyinks Limited). Outflows in these cases will depend upon
 settlement of demands/claims. This includes a provision of Rs 125
 million (as on 31 March 2010: Rs 125 million) carried forward from
 2002-03 in respect of continuing obligation of the Company towards
 probable land cost liability on sale of Catalyst business.
 
 (c) Other provisions are relating to litigation matters in respect of
 sale of properties and demand for past arrears in respect of
 electricity .
 
 (d) The utilisation of the provisions under (b) and (c) would depend on
 the resolution of the related issues which are expected in the next two
 to three years.
 
 5 Employee Benefits
 
 (F) Actuarial assumptions
 
 (c) Estimates of future salary increases take account of inflation,
 seniority, promotion and other relevant factors, such as supply and
 demand in the employment market.
 
 (d) In case of actuarial valuation of post retirement medical benefit,
 the following medical inflation rates have been considered: actual rate
 for 2011-12, 8% for 2012-13 and 6% for 2013-14 onwards. A one
 percentage point change in assumed healthcare cost trend rates would
 have the following effects on the aggregate of service cost and
 interest cost and defined benefit obligation:
 
 $ Included as an expense in Contribution to provident and other funds
 in Schedule 14.
 
 * Discount rate is based on market yields available on Government bonds
 as at 31 March 2011 with a term that matches that of the obligation.
 
 (ii) The actuarial valuation of Defined Benefit plans was carried out
 as on 31 March 2011. The net actuarial loss on account of post
 retirement benefits scheme amounting to Rs. 30 million (2009-10: Rs. 95
 million) relating to medical insurance costs have been provided for and
 included in Other retirement benefit charges (Schedule 14: Other
 Expenditure). Actuarial gains/losses (net) relating to other schemes
 have been included in Contribution to provident and other funds.
 
 (iii) During the year, the Company has purchased annuities for all
 management staff pensioners and some of the non- management staff
 pensioners for an amount of Rs. 389 million and Rs. 143 million
 respectively.
 
 (iv) The management staff pension trust (defined benefit trust) has an
 unrecognized surplus (fair value of plan assets over obligations) of Rs
 71 million as this amount is in excess of contributions towards future
 service cost of defined benefit members. The Company also has a defined
 contribution scheme for employees in the same trust and has adjusted
 this surplus against future contributions in respect of such employees.
 Accordingly the above surplus, after adjusting employer cost for the
 year, amounting to Rs 53 million has been recognised in the Profit and
 Loss Account in Schedule 12 and considered as an advance under Loans
 and Advances, Schedule 8.
 
 (v) The Company has separate pension schemes for management staff and
 non-management staff. The former scheme is in the nature of fnal
 salary plan and the latter scheme is in the nature of fat salary
 plan. The Company also has separate gratuity schemes for management and
 non-management staff. The benefits paid are as per the scheme rules or
 as per Payment of Gratuity Act, 1972, whichever are more beneficial.
 
 (vi) The guidance on implementing AS-15 (Revised) issued by Accounting
 Standards Board of the Institute of Chartered Accountants of India
 states that benefit involving employer established provident funds,
 which requires interest shortfall to be recompensated, are to be
 considered as defined benefit plans. As confirmed by the Actuary, there
 is no formal guidance from Acturial Society of India in this regard,and
 the Company believes that actuarial valuation at present is not
 necessary.  The amount of contribution during the year of Rs 18 million
 (2008-09: Rs 18 million) has been included in Contributions to
 provident and other funds in Schedule 14.
 
 6 Segment Information
 
 (A) Information about primary business segments :
 
 (1) The Companys business segments comprise of:
 
 Paints : consisting of decorative and refinish paints.
 
 Others : consisting of specialty starch and polymers (Specialty Starch
 business sold during the year refer note 3, schedule 18).
 
 * Excludes inter segment assets
 
 Notes:-
 
 i) The business segments have been identified in line with the
 Accounting Standard 17, taking into account the nature of products,
 risks and return, organisation structure and internal reporting system.
 
 
 ii) Segment revenue, results and assets and liabilities include the
 respective amounts identifiable to each of the segments.  Other
 un-allocable items in segment results include income from investment of
 surplus funds of the Company and corporate expenses. Unallocable assets
 include un-allocable fixed assets and current assets. Unallocable
 liabilities include un-allocable current liabilities and net deferred
 tax liability.
 
 7 Related Party Disclosures
 
 1.  (a) list of related parties where control exists:
 
 - Holding Company : Imperial Chemical Industries Limited, England.
 
 - Ultimate Holding Company : Akzo Nobel N.V., Netherlands 
 
 (b) Other related parties with whom transactions during the year have
 taken place :
 
 - Fellow subsidiaries:
 
 Akzo Nobel Car Refinishes India Pvt Ltd.  ICI Swire Paints (Shanghai)
                                           Ltd
 
 Akzo Nobel Car Refinishes Singapore       National Starch - Singapore
 
 Akzo Noble Chemicals (India) Ltd.         National Starch & Chemical
                                           Ltd. London
 
 Akzo Nobel Coatings India Pvt Ltd.        National Starch & Chemical 
                                           Ltd. Thailand
 
 Akzo Nobel Decorative Coatings BV (IM)    National Starch & Chemical 
                                           - USA (Bridgewater)
 
 Akzo Nobel Lanka (Pvt.) Limited           National Starch & Chemical 
                                           (Singapore) Pte Ltd.
 
 Akzo Nobel Ltd - Brazil                   Pinturas INCA
 
 Akzo Nobel Paints (Asia Pacific) Pte Ltd  Quest International Egypt SAE
 
 Akzo Nobel Paints Taiwan Ltd.             Shanghai ICI R&D
 
 Akzo Nobel Surface Chemistry AB           The Glidden Co.
 
 Akzo Nobel Surface Chemistry LLC USA      Vietnam Holdings
 
 Akzo Nobel Surface Chemistry Pte Ltd.
 
 Akzo Nobel (Shanghai) Co. Ltd.
 
 Akzo Nobel Paints Singapore Pte ltd
 
 Eka Chemicals (Thailand) Ltd
 
 ICI ( Paints) Vietnam Ltd.
 
 ICI Paints Indonesia
 
 ICI Paints (Malaysia) Sdn Bhd
 
 ICI Paints (Thailand) Ltd
 
 ICI India Research & Technology Centre
 
 - Key managerial persons
 
 Mr. A Narayan            Chairman (up to 30 Sep 2010)
 
 Mr. N Kaviratne          CBE Chairman (from 01 Oct 2010 )
 
 Mr. R L Jain             Managing Director (upto 31 May 2009)
 
 Mr. A Jain               Managing Director (from 1 Jun 2009)
 
 Mr. P S Basu             Wholetime Director (from 01 Nov 2010)
 
 
 8 (a) The Company uses forward exchange contracts to hedge against its
 foreign currency exposures relating to the underlying transactions
 
 The Company has not entered into any derivative instruments for trading
 or speculative purposes or for highly probable forecast transaction.
 
 (b) The Companys net foreign currency exposure [receivable/(payable)]
 that are not hedged by a derivative instrument or otherwise as on
 2010-11: nil (2009-10: nil)
 
 9 The figures relating to previous year have been regrouped, wherever
 necessary, to conform with the current years classification.