(a) Terms/ rights attached to Equity Shares
The Company has only one class of Ordinary Shares (''Equity Shares'')
having a par value of Rs. 1/- each. Each holder of Ordinary Shares
(''Equity Shareholders'') 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 of
the Company. In the event of the Liquidation, the Equity Shareholders
are eligible to receive the 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.
During the year ended 31st December, 2012, the amount of per Share
Dividend recognised as distribution to Equity Shareholders was Rs. 0.05/-
(31.12.2011- Rs. 0.05) The Total Dividend appropriation for the year
ended 31st December, 2012, amounted to Rs. 18,000,597 including Corporate
Dividend Tax of Rs. 2,512,549.
Nature of Security
(a) Loan repayable on demand from Banks
Outstanding loans of 1 1,665,813,679 (31.12.11 -1 1,645,251,770)
Secured by hypothecation created on stock, book debts, all moveable
assets and other current assets of the tea estates both present and
future and equitable mortgage created of all immovable properties both
present and future relating to all Tea Estates of the Company situated
in Assam ranking pari passu with all other term loans from Consortium
1. [a] All assets except Furniture as at 31st December, 1994, were
revalued by an approved valuer at the then net replacement cost
resulting in increase in value of these assets by Rs. 427,664,732. All
assets except Furniture as at 31st December, 1996, were revalued again
by an approved valuer at the then net replacement cost resulting in a
further increase in value of these assets by Rs. 113,567,000.
[b] Taking into account the total intrinsic value of the Company''s land
in Assam, no adjustment in the opinion of the Management is required
for the loss of land lost due to flood and consequent erosion in past
years. Claim for compensation in this regard has been made to the
2. Estimated amount of contracts remaining to be executed on capital
account and other commitment not provided for are as follows:-
[a] On capital account - Rs. 235,527 (net of advance - Rs. 867,345),
[31.12.2011- Rs. 10,264,615 (net of advance -Rs. 4,717,872)]
[b] Other Commitment - For Hire Purchase and Lease payments, Refer Note
No 36 [a] and 36 [b].
3. Contingent Liabilities not provided for in respect of :
[a] Sales Tax assessments disputed in appeals Rs. 174,272,207 (31.12.2011
- Rs. 108,907,869)
[b] LiabilitytowardsFringeBenefitTaxunderadjudication-Rs. 70,929,211
(31.12.2011 - Rs. 70,929,211).
[c] Guarantees given in favour of third parties Rs. 1,048,200,000
(31.12.2011 - Rs. 1,048,200,000).
[d] Pledged 5,000,000 shares (having cost of Rs 50,000,000)
representing investment in 51% Equity shares in Gujarat Hydrocarbons
and Power SEZ Ltd. in favour of third parties.
[e] Uncalled liability on partly paid shares - Rs. 6,999,510 (31.12.2011
- Rs. 6,999,510).
[f] Interest and penalty for non-deduction and non-deposit of tax
deducted at source from green leaf suppliers in respect of an earlier
year, not ascertainable at this stage.
[g] Financial undertaking issued to a subsidiary - amount not
The future cash flows on account of above cannot be determined unless
the judgement / decisions / demand are received from the appropriate
4. Provision for taxation has been made as per the Income Tax Act,
1961 and the rules framed thereunder with reference to the profit for
the year ended 31st December, 2012 which extends over two assessment
years, Assessment Year 2012-2013 and Assessment Year 2013 - 2014. The
ultimate tax liability for the Assessment Year 2013-2014 will be
determined on the total income for the period from 1st April, 2012 to
31st March, 2013.
5. As the production of green leaf (raw materials consumed by the
Company for the manufacture of Tea) from Company''s own Tea Estates
involves integrated process having various stages such as
nursery,planting,cultivation etc., theirvalues at intermediate stage
could not be ascertained.
6. [a] Assets acquired under Hire Purchase (HP) comprise of vehicles.
These agreements are of a period of 36 months and more and in certain
cases provide for revision of hire charges for variation in prime
lending rates of the bank. There are no restrictive covenants in the HP
[b] The Company has taken various premises under operating lease having
tenures upto 36 months which are not non-cancellable. These are usually
renewed periodically by mutual consent. The rental payable against
these lease amounting to Rs. 2,006,400 (31.12.2011 - Rs. 2,006,400) has
been debited to the Statement of Profit and Loss.
7. [a] The Companys'' Oil and Gas activities comprise of three Oil
Fields - Amguri (Discovered Field), AA-ON/7 (Exploration Block) and
AA-ONN-2005/1 (Exploration Block) having Participating Interest of 40%,
35% and 10% respectively. Amguri Oil Field and AA-ON/7 Exploration
Block were operated under a consortium with Canoro Resources Limited
(Canoro), a Canadian based E&P company. AA-ONN-2005/1 Exploration Block
is however under consortium with ONGC and OIL.
[b] Following termination of Production Sharing Contract (PSC) and 60%
Participation Interest (PI) of Amguri Field of Canoro by Government of
India (GOI) with effect from 29th August, 2010, Canoro finally closed
its operation in India in December,2012 having their appeal being
dismissed by Hon''ble High Court. GOI as interim arrangement had
appointed ONGC as the custodian of GOI to operate the field from 16th
March, 2011 pending appointment of a regular operator for which the
Company had already staked its claim alongwith the ownership of 60% PI
in accordance of the provisions of PSC. After a prolong delay, GOI has
finally appointed the Company as the operator of Amguri Field vide its
letter dated 2nd January, 2013. The Company on priority basis has now
taken steps to resume the operations and production of oil and gas in
[c] The Company also, under the Joint Operating Agreement (JOA),
exercised its right of first refusal on its claim on 60% PI from
Canoro. Accordingly, the Company initiated Arbitral proceedings against
Canoro as per PSC for redressal of dispute on ownership of majority
Equity Shareholding of Canoro and 60% PI of Amguri Field.
The Arbitral Tribunal passed the Award on21st November,2011 under which
the Company had become the rightful owner of 60% PI of Amguri and also
52.9% shares of Canoro which was earlier issued to Mass Financial
Corporation in breach of JOA. As per the said Award, the Company had
also got a damage claim of US$ 39.12 Million (Rs. 214.29 Crores) against
Canoro. The consideration of US$ 4.16 Million (Rs. 22.78 Crores) and US$
2.2071 Million (Rs. 12.08 Crores) assigned towards 60% PI ofAmguri and
52.9% shares of Canoro respectively was set off from the total damage
claim and the net damage claim of US$ 32.75 Million (Rs. 179.40 Crores)
was awarded against Canoro. Consequent upon the receipt of the Award,
the Company sought the formal consent from GOI on transfer of 60% PI
pursuant to the provisions of PSC which is still awaited.
[d] For execution of the Arbitral Tribunal award before Canadian Court,
the Company has initiated legal steps by filing execution petition on
9th November,2012 before the Supreme Court of British Columbia. The
hearing ofthe execution petition is due in April, 2013. Meanwhile, the
Company had received execution orders on Arbitral award against Canoro
from District Courts in Assam for taking possession of inventory and
[e] In view of delay in response from GOI for according consent on
assignment of 60% PI and operatorship of Amguri Field, the Company had
initiated Arbitral proceedings against GOI by filing Section 9
Application before Hon''ble High Court of Delhi seeking interim relief,
pending disposal ofthe case by Arbitral Tribunal. The Company had
received interim Judgment of Hon''ble High Court on 20th July,2012,
under which the Court had prima facie observed that the Company was
entitled to 60% PI of Canoro as per PSC and GOI should accord the
consent without holding it up further. However, GOI is still to take a
decision on this matter.
[f] In respect of AA-ON/7 Exploration Block, the area falls into two
States - Assam and Nagaland. The exploration activities in Assam were
completed and the area has been relinquished as there was no discovery
of oil and gas. In order to pursue exploration activities in the State
of Nagaland, a new PSC in continuation of the earlier PSC on the basis
of same terms and conditions of the earlier PSC will be executed very
shortly. The execution of new PSC has been delayed due to ongoing legal
dispute on Amguri with Canoro. Since the matter has now been finally
resolved and also Canoro''s PSC and PI on this Block has been terminated
by GOI vide letter dated 10th January,2013, the new PSC, which has
already been approved by GOI, will now be executed with the Company.
Similar to Amguri Field, the Company as per PSC is also entitled to 65%
PI and operatorship of this Block, earlier held by Canoro, as the
Company remained as the sole non-defaulting contractor. The Company has
already claimed the PI and Operatorship from GOI.
[g] The new PSC of AA-ON/7 Exploration Block will be in continuation of
the previous PSC and its terms and conditions will not be inferior to
the terms and conditions of previous PSC as confirmed by GOI. AA-ON/7
even though falls in two states - Assam and Nagaland and require
independent PSC, is a single E&P asset. Accordingly, all past
expenditure in this Block will qualify for 100% cost recovery and at
present it does not attract any capitalisation/impairment
provision/adjustment as per AS- 10 and 28 and Guidance Note on
Accounting for Oil & Gas producing activities.
[h] With regard to AA-ONN-2005/1 Exploration Block where ONGC is the
operator, the Geological and Geophysical (G&G) activities are under
[i] With regard to AA-ONN-2005/1 Exploration Block, this Block was
awarded under NELP-VII round under consortium with ONGC and OIL. The
PEL was obtained on 1st December, 2010. This Block falls in the
Assam-Nagaland border and is sensitive with respect to environment,
reserve forest and border disputes. Permission to conduct seismic
surveys was granted by Assam State Government recently hence
exploration activities are in early stages.
[j] The Company''s aggregate capital investments grouped under Capital
Work in Progress and Fixed Assets will be eligible for full cost
recovery as per PSC against future activities. The operations in Amguri
Field and AA-ON/7 Exploration Block will resume on receipt of consent
from GOI and execution of new PSC respectively.
[k] Fixed Assets Register has not been maintained in Oil & Gas Division
as details ofthe assets were maintained by the Operator (Canoro) which
has since been maintaind by ONGC as the custodian operator and 40%
share of cost was booked by ACIL for each of the assets. A list of
assets is maintained.
[l] In respect of oil and gas producing assets for which depreciation
rates has not been prescribed in Schedule XIV of the Companies Act,
1956, the Company has applied to the Central Government for its
approval to adopt the unit of production method of computing
depreciation for the purpose of provision of Section 205 of the
Companies Act, 1956, which is awaited.
[m] Cost Record Order is applicable for Oil and Gas. There was no
production during the year and the Company was not the Operator. All
relevant papers and records were maintained by the Operator.
8. The Company had issued Zero Per Cent Foreign Currency Convertible
Bonds (FCCB) in 2006 aggregating to USD 48 Million (INR
2,109,120,000) to finance capital expenditure for modernisation,
expansion and acquisitions. The Bond holders have an option of
converting these Bonds into Equity Shares at a conversion price of Rs.
28.75 per share, at any time on or after 28th November, 2006, subject
to compliance with certain conditions stated in the Offer Circular
dated 23rd November, 2006. The Bonds were redeemable on 30th November,
2011, at 150.019 per cent of their principal amount, unless previously
converted or redeemed.
Unutilised FCCB proceeds amounting to t7,884,472 (31.12.2011 -t
7,884,472) have been invested in securities and the balance t 241,015 (
31.12.2011 -t 241,015) is lying with banks at the year end.
The Principal amount of FCCBs outstanding at the beginning of the year
was USD 31.80 Million. The Company had during the year redeemed
Principal FCCBs of USD 22.70 Million together with agreed redemption
premium. As at the year end, the total Principal FCCBs outstanding is
USD 9.10 Million out of which the Company has since redeemed Principal
FCCBs of USD 6 Million with agreed redemption premium. The Company is
negotiating with the Bondholders for settlement of the remaining
FCCB''s. The Company had obtained permission from Reserve Bank of India
(RBI) for extending the time for redemption of Outstanding FCCBs beyond
the maturity date.
9. Advances and loans to subsidiaries include an amount oft
2,520,121,211 (including interest 1 1,111,049,664 Net of TDS) (31.12.11
t 2,118,199,469 including interest t 783,371,113 Net of TDS) due from
Gujarat Hydrocarbons and Power SEZ Limited (GHPSL), a Subsidiary of the
GHPSL was incorporated for developing a Hydrocarbon and Power Special
Economic Zone (SEZ) in the State of Gujarat. GHPSL had acquired 315
Hectares of land for its project from Gujarat Industrial Development
Corporation (GIDC) out ofwhich 296 Hectares possession was received and
the balance 19 Hectares is in the process of acquisition.The loan was
given towards acquisition and development of the acquired area by
10. Advances and loans to subsidiaries include interest free loan of Rs.
813,732,224) (31.12.11 t813,732,224) due from Duncan Macneill Natural
Resources Limited (DMNRL) a Wholly Owned Subsidiary of the Company
located in UK. The loan was given to acquire E&P assets.The Company, in
order to expand its oil and gas activities in upstream sector desire to
make a strong presence at overseas countries by acquiring E&P
assets.The Company is confident in acquiring economically feasible E& P
assets through DMNRL by using the loan given to them. DMNRL has agreed
to repay rupee equivalent of the total amount outstanding to the
11. Advances and loans to subsidiaries include interest free loan of Rs.
10,708,140 (31.12.11 t 10,174,605) due from Assam Oil and Natural Gas
Limited a Wholly Owned Subsidiary of the Company located in Cayman
Islands, as loan. The loan was given to acquire E&P (Oil and Gas)
assets in Colombia.
12. The Single Bench of the Hon''ble Calcutta High Court has allowed
the eviction proceedings filed by the owners in respect of the
Company''s Corporate Office at Kolkata.The Company has preferred an
appeal before the Division Bench of the Hon''ble Calcutta High Court,who
have stayed the order passed by the Single Bench. TheAppeal is pending
[i] The Company has considered business segment as the primary segment
for disclosure. The components of these business segments are
plantation products,oil and gas activities and Merchant trading.
[ii] The segment wise revenue, results, assets and liabilities relate
to the respective amounts directly identifiable to each ofthe segments.
Unallocable income/expenditure refers to income/expenses incurred on
common services at corporate level.
[iii] Geographical segment:
Segregation of revenue is on the basis of geographical location of
Sales within India Sales outside India
Segregation of asset and capital expenditure is on the basis of
geographical location of assets i.e. Asset within India Asset outside
[iv] Figures in bold represent previous year''s figures .
50. In line with the notification dated 31st March, 2009 and
notification dated 29.12.11 issued by the Ministry of Corporate
Affairs, amending Accounting Standard (AS) 11 - Effects of Changes in
Foreign Exchange Rate, the Company in the current year has:
[i] charged to the Statement of Profit and Loss Rs. 84,949,234 (31.12.11
- Rs. 136,945,139) being the amortisation charge of ''Foreign Currency
Monetary item Translation Difference Account'' (FCMITDA) for the year.
[ii] carried forward Rs. 165,916,130 (31.12.11- Rs. 174,684,288) in the
FCMITDA, amortisable by 31st January, 2020.
13. Employee Benefit Obligation Provident Fund
Provident Fund is a defined contribution scheme whereby the Company
contributes an amount determined as a fixed percentage of basic salary
to the Trust/Government authorities every month.
The Company operates three gratuity schemes wherein every employee is
entitled to the benefit equivalent to 15 days salary last drawn for
each completed year of service. The same is payable on retirement or
termination of service, whichever is earlier. Annual contributions
based on actuarial valuation carried out at the year end are made to an
independent trust fund who in turn is investing in a private insurance
company under group gratuity scheme.
The Company operates two pension schemes for eligible employees, one of
them being a defined benefit scheme and the other a defined
contribution scheme. Annual contributions to the defined benefit scheme
are made by the Company based on actuarial valuation carried out by the
Company at year end. Contributions for the defined contribution scheme
are deposited with a Trust and such funds are funded to a private
Leave benefit comprises of leave balances accumulated by the employees.
These balances can be accumulated upto a maximum of 120 days and can be
encashed only at any time of retirement/separation.
Post Retirement Medical Benefit
The Company has a scheme of re-imbursement of post retirement medical
expenses to certain categories of employees and their surviving
spouses, upon retirement, subject to a monetary limit.
A. Defined Contribution Plans
Contributions for Defined Contribution Plans amounting to t 9,17,04,830
(31.12.2011 t 8,47,96,893) has been recognised in the Profit & Loss
(i) The estimates of future salary increases considered in the
actuarial valuation takes into account factors like inflation, future
salary increases, seniority, promotion, supply and demand in the
employment market etc. The expected return on plan assets is based on
the actuarial expectation of the average long term rate of return on
investments of the fund during the estimated time of the obligations.
(ii) Since the Company has adopted Accounting Standard 15 (Revised
2005) on Employee Benefits during the year 2007, figures for five
financial years are available and have been disclosed except for post
retirement medical benefits which have been actuarially valued from the
(iii) As per the actuarial valuation carried out ,there is gain in
contribution to be made during the year of Rs.3,618,543 and Rs. 2,465,546
in Management Staff Gratuity Fund and Clerical, Medical & Technical
Staff Pension Fund respectively.As a matter of prudence the effect of
the same has not been taken.
(iv) The contribution expected to be made by the Company for the year
ending 31st December, 2013, cannot be ascertained at this stage.
14. Related Party Disclosure :
I. Names of related parties and description of relationship
[a] Subsidiaries of the Company
Namburnadi Tea Company Limited Camellia Cha Bar Limited North East
Hydrocarbon Limited Assam Oil and Gas Limited Duncan Macneill Natural
Dahej Offshore Infrastructure SEZ Limited (Formerly known as Assam
Gujarat Hydrocarbons and Power SEZ Limited
Duncan Macneill Power India Ltd. (Formerly known as Duncan Macneill
Power and Utilities Ltd.) Assam Oil & Natural Gas Limited.
[b] Stepdown subsidiaries
Lord Inchcape Financial Services Limited (control exercised through two
Assam Oil & Natural Gas Columbia Limited
[c] Key Managerial Personnel
Mr. A.K.Jajodia, Managing Director
[d] Relatives of Key Managerial Personnel
Ms. Ruchika Jajodia
[e] Joint Venture through jointly controlled operations
Canoro Resources Limited
Oil and Natural Gas Corporation Limited
Oil India Limited
15. Pursuant to a Resolution passed by the Shareholders on 26th June,
2012 and the subsequent approval of the Board on 2nd August, 2012, the
Company had entered into an Agreement for Sale (Agreement) on 3rd
August, 2012 with Salonah Tea Private Limited (Purchaser) for sale of
Salonah Tea Estate (the Estate) subject to receipt of requisite
approvals and NOCs from the concerned authorities which are awaited.
Pursuant to the said Agreement, the profit and loss and liabilities
will accrue and arise to the account of Purchaser from the appointed
date i.e. 20th August, 2012. Accordingly, the Company has discontinued
to account for all the income and expenditure of the Estate effective
from the same date. As the sale of the Estate is yet to be completed
pending receipt of requisite approvals and NOCs and execution of
conveyance deed, the assets and ownership of the Estate continues to
remain with the Company.
Net block of Fixed Assets as referred in Note No.11 includes Assets
pertaining to Salonah Tea Estate which are not being used by the
Company from the appointment date ie. 20th August, 2012 and held for
16. The Company has obtained a stay from the Hon''ble Guwahati High
Court restraining the taxation authorities from imposing and collecting
Fringe Benefit Tax (FBT) under Section 115WA of the Income Tax Act,
1961. In view of this, the Company has not provided the liability for
FBT till the year-end December, 2009.
17. The Financial Statements for the year ended 31st December, 2011
had been prepared as per the then applicable, pre-revised Schedule VI
to the Companies Act,1956.Consequent to the notification of Revised
Schedule VI under the Companies, Act 1956, the Financial Statements for
the year ended 31st December, 2012 are prepared as per Revised Schedule
VI. Accordingly, the previous year figures have also been reclassified
to conform with this year''s classification.