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Godrej Properties

BSE: 533150|NSE: GODREJPROP|ISIN: INE484J01027|SECTOR: Construction & Contracting - Real Estate
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« Mar 15
Notes to Accounts Year End : Mar '16
Note 1.
 
 (a) A Scheme of Amalgamation (the Scheme) for amalgamation of GIL
 Vikhroli Real Estate Limited (GVREL or the Transferor Company) with
 Godrej Properties Limited (GPL or the Transferee Company), with
 effect from August 1, 2015, (the Appointed date) was sanctioned by
 the Honorable High Court of Judicature at Bombay (the Court), vide
 its Order dated February 26, 2016 and certified copies of the Order of
 the Court sanctioning the Scheme were filed with the Registrar of
 Companies, Maharashtra on March 15, 2016 (the Effective Date).
 Accordingly the standalone results of the Company for the year ended
 March 31, 2016, include the results of the erstwhile GVREL for the
 period from August 01, 2015 to March 14, 2016.
 
 (b) The Company has carried out the accounting treatment prescribed in
 the Scheme as sanctioned by the Honorable High Court of Judicature at
 Bombay. Accordingly, the Scheme has been given effect to in these
 accounts and all the assets and liabilities of GVREL stands transferred
 to and vested in the Transferee Company with effect from the Appointed
 Date. In accordance with the Scheme, the assets and liabilities of
 GVREL have been taken over and recorded at their book values as on
 August 01, 2015.
 
 (i) The amount of Rs. 141.62 crore arising out of the difference
 between the book value of the net assets of the Transferor Company
 taken over and face value of shares issued has been transferred to
 Capital Reserve Account.
 
 (ii) Upon the Scheme becoming effective, 16,745,762 Equity Shares of
 face value of Rs. 5/- each of the Transferee Company have been allotted
 to the shareholders of Transferor Company based on the exchange ratio
 of 13 (Thirteen Only) Equity Shares of the Transferee Company of Rs. 5
 each fully paid up for 118 (One Hundred Eighteen Only) equity shares of
 Transferor Company Of Rs. 10 each fully paid up and the entire equity
 share capital of GVREL stands cancelled.
 
 (e) Since the aforesaid Scheme of merger of the GVREL with the Company,
 which is effective from August 1, 2015, has been given effect to in
 these accounts, the figures for the current year to that extent are not
 comparable with those of the previous year.
 
 (f) The cost and expenses arising out of or incurred in carrying out
 and implementing the scheme amounting 3.90 crore have been debited in
 the Statement of Profit & Loss of the Transferee Company (Refer Note
 26).  The Cost and expenses incurred in issuing shares to the
 shareholders of the Transferor Company amounting to Rs. 0.45 crore has
 been adjusted against Securities Premium Account pursuant to provisions
 of Section 52 of the Companies Act, 2013.
 
 Note 2.
 
 Dues to Micro and Small Enterprises
 
 Disclosure of trade payables and other liabilities is based on the
 information available with the Company regarding the status of the
 suppliers as defined under the Micro, Small & Medium Enterprises
 Development Act 2006. There is no amount overdue as on 31st March,
 2016 to Micro & Small Enterprises on account of principal amount
 together with interest and also during the previous year.
 
 Note 3.
 
 Employee Stock Option Plan
 
 (a) During the financial year ended March 31, 2008, the Company
 instituted an Employee Stock Option Plan (GPL ESOP) approved by the
 Board of Directors, Shareholders and the Remuneration Committee, which
 provided allotment of 885,400 options convertible into 885,400 Equity
 Shares of Rs. 5/- each to eligible employees of Godrej Properties
 Limited and its Subsidiary Companies (the Participating Companies) with
 effect from December 28, 2007.
 
 The employee share based payment plans have been accounted based on the
 intrinsic value method and no compensation expense has been recognized
 since the price of the underlying equity shares on the grant date is
 same /less than exercise price of the option, the intrinsic value of
 option, therefore being determined as Rs. Nil.
 
 (b) The Company has provided loan of Rs. 43.91 crore (Previous Year Rs.
 44.02 crore) to GPL ESOP Trust, which has purchased shares of GPL from
 Godrej Industries Limited equivalent to the number of stock options
 granted from time to time to eligible employees. The Market Value as on
 March 31, 2016, of the shares held by the ESOP trust is lower than the
 holding cost of these shares by Rs. 8.81 crore (Net of Provision of Rs.
 5.89 crore).  The repayment of the loans granted by the Company to ESOP
 Trust is dependent on the exercise of the options by the employees and
 the market price of the underlying shares of the unexercised options at
 the end of the exercise period. The fall in value of the underlying
 equity shares is on account of market volatility and the loss, if any,
 can be determined only at the end of the exercise period.
 
 (c) The Company has provided loan of Rs. 4.50 crore (Previous Year Rs.
 5.56 crore) to Godrej Industries Limited Employee Stock Option Scheme
 (GIL ESOP Trust), which purchases shares of GIL from the market
 equivalent to the number of stock options granted from time to time to
 eligible employees. The repayment of the loans granted by the Company
 to ESOP trust is dependent on the exercise of the options by the
 employees and the market price of the underlying shares of the
 unexercised options at the end of the exercise period.
 
 Note 4
 
 Employee Stock Grant Scheme
 
 (a) During the period April 1, 2011 to March 31, 2016, the Company
 instituted an Employee Stock Grant Scheme (GPL ESGS) approved by the
 Board of Directors, shareholders and the Remuneration Committee, which
 provided allotment of 730,505 options convertible into 730,505 Equity
 Shares of Rs. 5/- each to eligible employees of Godrej Properties
 Limited, its Holding and its Subsidiary Companies (the Participating
 Companies). Out of these 82,406 options granted with effect from May
 07, 2011, 3,756 options w.e.f. October 01, 2011, 72,416 options w.e.f.
 June 01, 2012, 22,040 options w.e.f. June 01, 2012, 4,436 options
 w.e.f. August 01, 2012, 690 options w.e.f.  November 01, 2012, 720
 options w.e.f. February 01, 2013, 30,000 options w.e.f. June 01, 2013,
 125,744 options w.e.f. June 01, 2013, 182,485 options w.e.f. June 01,
 2014, 40,000 options w.e.f June 01, 2014, 2,305 options w.e.f. November
 01, 2014, 109,273 options w.e.f. June 01, 2015, 45,896 options w.e.f.
 June 01, 2015, 6,218 options w.e.f. September 01, 2015, and 2,120
 options w.e.f. February 01, 2016. Out of the total 730,505 stock
 grants, 111,718 stock grants have lapsed on account of employees
 leaving the service of the company before the vesting date, 367,772
 stock grants have been vested and 364,190, options have been exercised,
 hence 254,597 stock grants are outstanding as at March 31, 2016.
 
 Note 5.
 
 The amount of exchange difference included in the Statement of Profit
 and Loss, is Rs. 0.01 crore (Net Gain) under the head Other Income
 (Previous Year Rs. 0.01 (net gain)).
 
 (b) Defined Benefit Plans: Gratuity Scheme
 
 Gratuity is payable to all eligible employees on death or on
 separation/termination in terms of the provisions of the Payment of
 Gratuity Act or as per the Company''s policy whichever is beneficial to
 the employees.
 
 The following table sets out the funded status of the gratuity plan and
 the amounts recognized in the Company''s financial statements:
 
 The estimates of future salary increases, considered in actuarial
 valuation, take into account inflation, seniority, promotion and other
 relevant factors, such as supply and demand in the employment market.
 
 Note 6.
 
 Segment Information
 
 As the company has only one business segment, disclosure under
 Accounting Standard 17 on Segment Reporting issued by the Institute
 of Chartered Accountants of India is not applicable.
 
 Note 7.
 
 Managerial Remuneration paid for the year exceeded the permissible
 limit as prescribed under Schedule V of the Companies Act, 2013 by Rs.
 7.71 crore (Previous Year Rs. Nil).  The Company is in the process of
 obtaining approval from Shareholders and Central Government of India
 for such excess remuneration paid. Pending such approvals, the amount
 is held in trust for the Company.
 
 Note 8.
 
 The Company has spent Rs.2.18 crore during the financial year (Previous
 year Rs. 1.47 crore) as per the provisions of Section 135 of the
 Companies Act, 2013 towards Corporate Social Responsibility (CSR)
 activities grouped under ''Other Expenses''(Refer Note 26).
 
 (a) Gross amount required to be spent by the company during the year
 Rs.2.18 Cr.
 
 Note 9.
 
 Previous year figures have been regrouped wherever necessary to conform
 to current year''s classification.
Source : Dion Global Solutions Limited
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