1.1.  Background 
 
 Dharani Sugars and Chemicals Limited (Company) was incorporated on 4
 June 1987 as a Limited 
 
 1.2.1 Capital Commitments
 
 Estimated amount of contracts remaining to be executed on capital
 account and not provided for (Net of advances) Rs. 2654.71 lakhs
 (Previous year- Rs. 4333.39 lakhs).
 
 1.3.2 Contingent Liabilities
 
 i. Claims against the Company not acknowledged as debt Rs.619.66 lakhs
 (Previous year -Rs.487.90 lakhs)
 
 ii.  Purchase Tax demand contested Rs.Nil (Previous year- Rs.745.68
 lakhs)
 
 iii. The Company has imported 381167.66 MT of raw sugar during the
 previous years and out of which 223957 MT has been imported under
 Advance License. As per the terms and conditions of License 213295 MT
 of white sugar will have to be exported within the prescribed period of
 the respective License.  
 
 The Company has so far exported 178548 MT of white sugar (Including
 88758 MT in previous year). The Company is hopeful of fulfilling its
 balance export obligations. In the unlikely event of not fulfilling the
 export obligation, the Company has to pay the amount of duty concession
 availed in respect of its imports along with interest.
 
 1.3.3 Taxation
 
 i.  Provision for current tax
 
 Inview of current year losses under the provisions of the lncome Tax
 Act, 1961,and on the basis of the assessments carried out, the tax
 liability to Income-tax during the year is lower than the Minimum
 Alternate Tax. Hence, Minimum Alternate Tax (MAT) of Rs.93.11 lakhs is
 provided during the year.
 
 ii. Deferred taxation
 
 The Company had created deferred tax liability (net) in accordance with
 the requirements of the Accounting Standard 22 Accounting for Taxes on
 Income.
 
 1.3.4 Deposits with Bank
 
 i. Deposits with Banks under lien to commercial tax officers Rs.0.03
 lakhs (Previous year- Rs.0.03 lakhs) 
 
 ii.  Deposit under lien to Bank / others, Guarantees / Performance
 Rs.Z71.56 lakhs (Previous year- Rs.370.Z9 lakhs) 
 
 1.3.5 Capitalisation of Borrowing Cost:
 
 In line with Accounting Standard 16 issued by the ICAI, the Company has
 identified the borrowing cost with respect to specific assets at the
 New Unit lll at Sankarapuram.  
 
 Interest amount included in Capital Work in Progress Rs.539.85 Lakhs.
 (Previous Year - Rs. 60.16 Lakhs)
 
 1.3.6 Other Information
 
 i. Managerial Remuneration
 
 Within the limit prescribed under Schedule XIII of the Companies Act,
 1956 and approved by the Central Government and the shareholders.  
 
 The above working for commission is made in line with the approval
 received from Central Government. The managerial remuneration for the
 current year is in accordance with the provisions of Section 198 read
 with Schedule XIII of the Companies Act, 1956.
 
 iii. Realisable value of Current Assents, Loans and advances
 
 a.  In the opinion of the Board, the investments, current assets, loans
 and advances are realizable at a value, which is at least equal to the
 amount at which these are stated, in the ordinary course of business
 and provision for all known and determined liabilities are adequate and
 not in excess of the amount stated.
 
 b.  Advances include Rent Advance of Rs.41.53 Lakhs paid to Dr. Palani
 G. Periasamy, Executive Chairman in respect of the property taken on
 lease for office purpose. Maximum amount outstanding
 atanyonetimeduringtheyearRs.41.53 Lakhs (Previous year Rs.41.53 Lakhs) 
 
 The above information and that given in Schedule 11 regarding Micro
 Small and Medium Enterprises have been determined to the extent the
 Company has received information from vendors regarding their status
 under Micro Small and Medium Enterprises Development Act,2006.  
 
 1.3.7 Related Party 
 
 i.  Names of Related Parties: 
 
 Nature of relationship             Name 
 
 Associate Enterprises              M/s. Dharani Finance Limited(DFL) 
 
                                    M/s. Appu Hotels Limited (AHL) 
 
                                    M/s. PGP Educational & Welfare
                                    Society (PGPE&WS) 
 
                                    M/s. Dharani Developers Private 
                                    Limited (DDPL) 
 
 Key Management Personnel           Dr. Palani G. Periasamy, 
                                    Executive Chairman 
 
                                    Mr. M. Ramalingam, Managing 
                                    Director, 
 
                                    Mr. A. Sennimalai, Director 
 
 Enterprises Significantly          M/s. Ananthi Developers Limited 
 influenced by Key Management       (ADL)
 Personnel 
 
 ii. The above information regarding related parties have been
 determined to the extent such parties have been identified on the basis
 of information available with the company.
 
 iv. No balances in respect of the related parties have been provided
 for/written back/ written of except as stated above.
 
 1.3.8 Segment Reporting 
 
 The Company has disclosed Business Segment as the primary segment.
 Segments have been identified taking into account the nature of the
 products, the differing risks and returns the organisation structure
 and internal reporting system.
 
 The Company''s operations predominantly relate to manufacture of Sugar.
 Other business segments reported are Distillery and Power. Sugar
 segment includes molasses and other by-products.  
 
 Segment Revenue, Segment Results, Segment Assets and Segment
 Liabilities include the respective amounts identifiable to each of the
 segmentas also amounts allocated on a reasonable basis.
 
 The expenses, which are not directly attributable to the business
 segment, are shown as unallocated corporate cost.
 
 Assets and Liabilities that cannot be allocated between the segments
 are shown as part of unallocated corporate assets and liabilities
 respectively.
 
 Inter segment Transfer Pricing Policy (i) The molasses supplied to
 Distillery segment is based on average market price. (ii) Power used by
 other segments is based on 90% of the market price.
 
 1.3.9 Previous year comparatives 
 
 Previous year''s figures have been regrouped/rearranged and reclassified
 wherever necessary to conform to current year''s classifications.