1.  Consequent upon the decision of the Supreme Court in the matter of
 prices of certain bulk drugs fixed by the Government of India under the
 Drug (Prices Control) Order, 1979, the Company paid an amount of Rs.
 31,200 thousands in 1988 being the liability determined by the Special
 Team appointed by the Government. However, during 1990, fresh demands
 aggregating to Rs. 781,000 thousands alleged to be payable into the
 Drug Prices Equalisation Account (DPEA) were made by the Government on
 account of alleged unintended benefit enjoyed by the Company. The
 Government has also made certain claims for applicable interest. On a
 Writ Petition filed by the Company in 1991, the Bombay High Court
 passed an order whereby the demands were to be treated as show cause
 notices. The High Court directed the Company and the Government to
 furnish relevant data to each other based on which the Government was
 to rework the figures. The Government did not furnish the requisite
 data to the Company. In 1995, a further demand of Rs. 79,500 thousands
 was made by the Government.
 
 In the meantime, a Committee was constituted by the Government to
 determine the liabilities of the Drug Companies. The Company filed
 written submissions with the Committee and contended during the
 personal hearing that in the absence of the Government furnishing the
 requisite data as directed by the Bombay High Court, the Company was
 not in a position to make an effectual presentation before the
 Committee.
 
 In January 1999, the Company filed an Application before the Bombay
 High Court seeking directions to the Government to furnish the
 requisite data. The Application is pending. In the meantime, the
 Committee has deferred further hearing of the Companys case, until the
 Application is heard and decided by the Bombay High Court. In any
 event, the Company is contesting the above demand.
 
 2.  The tax year for the Company being the year ending March 31, the
 provision for taxation for the year is the aggregate of the provision
 made for the three months ended March 31,2010 and the provision based
 on the profit for the remaining nine months up to December 31,2010, the
 ultimate liability of which will be determined on the basis of the
 profit for the taxyear April 1,2010 to March 31,2011.
 
 3.  Balance with customs and excise authorities includes excise and
 cenvat deposit Rs. 30,713 thousands (2009: Rs. 46,967 thousands) with
 toll manufacturers.
 
 4.  Estimated amount of contracts remaining to be executed on capital
 account and not provided for (net of advances) Rs. 200,164 thousands
 (2009: Rs. 171,519 thousands).
 
 5.  Contingent Liabilities and commitments:
 
                                                    (Rupees000) 
                                             Dec 2010      Dec 2009
 
 Tax demands in respect of which*:
 
 - Tax authorities have appealed against 
 Income tax orders which were                 439,949       708,399
 ruled in favour of the Company
 
 - Companys appeals are pending before
   appropriate authorities                    713,697       696,733
 
 * Contingent liabilities in respect of pending tax assessments in
 relation to similar matters are not determinable and hence not
 disclosed.
 
 6.  Related parties
 
 i.  Parties where control exists:
 
 a) Hoechst GmbH, Germany, holding Company (holds 60.4% of the equity
 share capital as at December 31,2010)
 
 b) Sanofi-Aventis SA, France, ultimate holding Company
 
 ii.  Other related parties with whom transactions have taken place
 during the year: -
 
 a) Fellow subsidiaries
 
 Sanofi-Aventis Sp. Zoo Sanofi-aventis australia pty Limited
 
 sanofi-aventis Lanka Limited Sanofi-Aventis Deutschland GmbH
 
 (formerly known as Aventis Pharma Limited) Sanofi-aventis Korea Co.
 Limited
 
 Sanofi-Aventis Groupe S.A.  Sanofi-Aventis Egypt SAE
 
 Sanofi Pasteur S.A.  Sanofi-Aventis SpA
 
 FrancopiaS.A.R.L.  Sanofi-Aventis US LLC
 
 Sanofi-Aventis Recherche & Developement S.A.  Sanofi-Aventis Singapore
 Pte. Limited
 
 Sanofi Winthrop Industrie S.A.  Sanofi-aventis Vietnam Company Limited
 
 Sanofi Chimie S.A.  sanofi-aventis Bangladesh Limited
 
 Aventis Pharma Limited, UK (Formerly known as Fisons Bangladesh
 Limited)
 
 Winthrop Pharmaceuticals UK Limited Sanofi-aventis (Malaysia) SDNBHD.
 
 PT Aventis Pharma (Indonesia) Sanofi-Aventis Private Co. Limited
 
 Sanofi-Synthelabo (India) Limited Shantha Biotechnics Limited
 
 Sanofi Pasteur India Private Limited
 
 b) Joint venture (refer note 27 of schedule 16):
 
 Chiron Behring Vaccines Private Limited, India (up to December 23,2010)
 
 c) Key management personnel of the Company for the year Name Category
 of Directorship
 
 Dr. Shailesh Ayyangar Managing Director
 
 Mr. Madhusudan Garimela Rao Executive Director from 25th October, 2010
 
 Mr. Shirish Chandrakant Ghoge Executive Director from 25th October,
 2010
 
 Mr. Michel Dargentolle Executive Director
 
 (From January 1,2010 to March 22,2010,
 from March 31,2010 to July 17,2010
 &from July 19,2010to December 31,2010)
 
 vii) Basis used to determine expected rate of return on assets
 
 Expected rate of return on investments is determined based on the
 assessment made by the Company at the beginning of the year on the
 return expected on its existing portfolio since these are generally
 held to maturity, along with the estimated incremental investments to
 be made during the year.
 
 viii) General descriptions of significant defined Plans
 
 Gratuity Plan
 
 Gratuity is payable to all eligible employees of the Company on
 superannuation, death and permanent disablement in terms of provisions
 of the Payment of Gratuity Act or as per the Companys Scheme whichever
 is more beneficial. Benefit would be paid at the time of separation
 based on the last drawn base salary.
 
 Pension Plan
 
 Under the Companys Pension scheme, certain executives are eligible for
 fixed pension for five years, depending on their level at the time of
 retirement on superannuation, death or early retirement with the
 consent of the Company.
 
 Provident Fund
 
 The Company manages the provident fund through a Provident Fund Trust
 for its employees (except Staff and Workmen at Ankleshwar unit) which
 are permitted under The Employees Provident Fund and Miscellaneous
 Provisions Act, 1952. The Plan envisages contribution by employer and
 employees and guarantees interest at the rate notified by the Provident
 Fund Authority. The contribution by employer and employee, together
 with interest, are payable at the time of separation from service or
 retirement.
 
 7.  Reimbursement of expenses includes expenses recovered for common
 shared utilities and services from Bayer CropScience Limited and Chiron
 Behring Vaccines Private Limited. Further it also includes market
 support and clinical trials reimbursement from fellowsubsidiaries.
 
 8.  Capital work in progress as at December 31, 2010 includes
 intangibles under development amounting to Rs. 30,042 thousands (2009:
 Rs. 84,450 thousands)
 
 9.  Excise duty on sales amounting to Rs. 223,062 thousands (2009: Rs.
 213,826 thousands) has been reduced from sales in profit & loss account
 and increase/ (decrease) of excise duty on inventories, sample etc.
 amounting to Rs. 18,679 thousands (2009: Rs. (4,215) thousands) has
 been considered as (income)/expense in Schedule 13 of financial
 statements.
 
 10.  The Company sold its entire shareholding of 4,900,000 Equity
 Shares of Rs. 10 each constituting 49% of the paid-up share capital of
 the Joint Venture Company (JVC), Chiron Behring Vaccines Private
 Limited in December 2010 to Novartis Pharma AG, (a nominee of Novartis
 Vaccines and Diagnostics Inc., the Companys partner in the JVC) for a
 sale consideration of Rs. 1,007,507 thousands on which the Company has
 earned a profit of Rs. 757,375 (net of tax of Rs. 201,132 thousand)
 thousands which is disclosed as an exceptional items.
 
 11.  Previous years figures have been regrouped wherever necessary to
 confirm to this years classification.