2010-2011   2009-2010
                                                  Rs. Crore   Rs. Crore
 
 1 Contingent Liabilities
 
 a) Sales Tax liability that may arise in 
    respect of matters in appeal                     8.54        8.45
 
 b) Excise Duty liability that may arise in 
    respect of matters in appeal                     0.90        0.90
 
 c) Income Tax liability that may arise in 
    respect of matters in appeal                     2.84        2.84
 
 d) Claims made against the Company, not 
    acknowledged as debts                           13.98       14.52
 
 e) Wage demand not acknowledged by the 
    Company in respect of matter in appeal           3.37        2.89
 
 f) Bonds executed in favour of Collector of 
    Customs/Central Excise                           9.13        8.98
 
 g) Guarantees given on behalf of a subsidiary 
    company                                         13.01       11.88
 
 Notes:
 
 i) The Company does not expect any reimbursement in respect of the
 above contingent liabilities.
 
 ii) It is not practical to estimate the timing of cash outflows, if
 any, in respect of matters at (a) to (e) above, pending resolution of
 the appellate proceedings.
 
 2 Exchange differences arising on foreign currency transactions:
 
 a) Rs. 0.62 crore (net gain) (Previous Year Rs. 0.16 crore (net gain))
 has been accounted under the respective revenue accounts and
 
 b) Net premium on account of forward contracts to be recognised in
 future accounting period Rs. 0.93 crore (Previous Year Rs. 0.25 crore).
 
 3 a) Certain plant and machinery, computers and vehicles are taken on
 non-cancellable operating lease. These lease agreements are normally
 renewed on expiry.
 
 b) Rent expense in respect of operating lease, for nine months period
 ended 31st March, 2011 was Rs. 4.50 crore (Previous Year Rs. 4.63
 crore). Contingent rent recognised in Profit and Loss Account is Rs.
 Nil.( Previous Year Rs. Nil).
 
 c) The lease agreements provide for an option to the Company to renew
 the lease at the end of the non-cancellable period. There are no
 exceptional / restrictive covenants in the lease agreements.
 
 4 a) The period / year end foreign currency exposures that were not
 hedged by a derivative instrument or otherwise are given below:
 
 b) Derivative Instruments
 
 The Company uses foreign currency forward contracts to hedge its risks
 associated with foreign currency fluctuations relating to certain firm
 commitments and forecasted transactions. The use of foreign currency
 forward contracts is governed by the Companys strategy, approved by
 the Board of Directors, which provides principles on the use of such
 forward contracts consistent with the Companys Risk Management Policy.
 The Company does not use forward contracts for speculative purposes.
 
 5 Disclosure as required by Accounting Standard (AS)-15 (Revised)
 Employee Benefits
 
 1 Defined Contribution Plans:
 
 The amount recognised as an expense during the nine months period ended
 31st March, 2011 towards Provident Fund contribution and Superannuation
 is Rs. 3.88 crore (Previous Year Rs. 4.75 crore) and Rs. 1.45 crore
 (Previous Year Rs. 2.02 crore) respectively.
 
 2 Defined Benefit Plans:
 
 Gratuity :
 
 The Company has a defined benefit plan (the Gratuity Plan), managed by
 trusts. The Gratuity Plan provides for a lump sum payment to vested
 employees at retirement or termination of employment, whichever is
 earlier, based on the respective employees last drawn salary and years
 of employment with the Company. The benefit vests after five years of
 continued service.
 
 3 Compensated Absences:
 
 The obligation for compensated absences is recognised in the same
 manner as gratuity and net charge to Profit and Loss Account for the
 period is Rs. 0.28 crore (Previous Year Rs. 0.66 crore).
 
 4 Retirement Pension Scheme :
 
 For UK branch employees, based on actuarial valuation, the Company had
 recognised liability of Rs. 4.36 crore (equivalent GBP 5,92,000) in the
 previous year, towards present value of post retirement pension. The
 same is now funded appropriately.
 
 Note:
 
 The estimates of future increase in salary, considered in the actuarial
 valuation, have been derived based on expected inflation, seniority
 changes, promotion and other relevant factors such as demand in the
 employment market.
 
 18 Disclosure as required by Accounting Standard (AS)-17 Segment
 Reporting
 
 Segment Identification, Reportable Segments and segment composition :
 Segment Identification:
 
 Business segments have been identified on the basis of the nature of
 products/services, the risk-return profile of individual divisions, the
 organisational structure and the internal reporting system of the
 Company.
 
 Reportable Segments:
 
 Reportable segments have been identified as per the quantitative
 criteria specified in Accounting Standard (AS)- 17:Segment Reporting
 
 Segment Composition:
 
 1.  Engines comprises of single and multi cylinder engines.
 
 2.  Infrastructure Equipment comprises of equipment used in road
 construction, bridges, dams, mining, etc.
 
 3.  Others includes Power Tillers and its spares.
 
 Primary / secondary segment reporting format:
 
 1.  The risk-return profile of the Companys business is determined
 predominantly by the nature of its products and services. Accordingly,
 the business segments constitute the primary segments for disclosure of
 segment information.
 
 2.  In respect of secondary segment information, the Company has
 identified its geographical segments as (i) Domestic and (ii) Overseas.
 
 The expenses and incomes which are not directly attributable to the
 business segments are shown as unallocable income/expenditure.
 Unallocable assets mainly comprise of investments, cash and bank
 balances, advance tax and unallocable liabilities mainly include loan
 funds, tax provisions and provisions for employee retirement benefits.
 
 6 Disclosures as required by Accounting Standard (AS)-18 Related
 Party Disclosures 
 
 I Relationships with Related Party:
 
 A) List of related parties over which control exists:
 
 Name of the Related Party              Relationship
 
 i)   Greaves Leasing Finance Limited   Wholly Owned Subsidiary
 
 ii)  Greaves Cotton Netherlands B.V.   Wholly Owned Subsidiary
 
 iii) Greaves Auto Limited              Wholly Owned Subsidiary
 
 iv)  Dee Greaves Limited               Wholly Owned Subsidiary of 
                                        Greaves Leasing Finance 
                                        Limited
 
 v)   Greaves Farymann Diesel GmbH      Wholly Owned Subsidiary of 
                                        Greaves Cotton Netherlands B.V.
 
 vi)  Ascot International FZC           Subsidiary of Greaves Cotton 
                                        Netherlands B.V.
                                        (w.e.f. 6th February, 2011)
 
 B) Key Management Personnel :
 
 Mr. Prabhakar Dev - Managing Director and CEO
 
 C) List of related parties with whom transactions were carried out
 during the period/year and description of relationship :
 
 Subsidiaries:
 
 i) Greaves Leasing Finance Limited
 
 ii) Dee Greaves Limited
 
 iii) Greaves Cotton Netherlands B.V.
 
 iv) Greaves Farymann Diesel GmbH
 
 v) Greaves Auto Limited
 
 vi) Ascot International FZC 
 
 Key Management Personnel :
 
 Mr. Prabhakar Dev - Managing Director and CEO 
 
 Other Related Parties :
 
 i) Premium Transmission Limited (Associate company)
 
 ii) Mr. Karan Thapar (Chairman)
 
 IV Key Management Personnel (KMP): Remuneration to Managing Director
 Rs. 0.81 crore (Previous year Rs.1.04 crore).
 
 22 Management has evaluated impairment of assets as required by
 Accounting Standard (AS)-28 Impairment of Assets and on the basis of
 such evaluation, management is of the opinion that there is no
 impairment of the Companys assets as at 31st March, 2011.
 
 7 Disclosure as required by Accounting Standard (AS)-29 Provisions,
 Contingent Liabilities and Contingent Assets Movement of Provisions:
 
 Warranties                                        2010-2011  2009-2010
                                                   Rs. Crore  Rs. Crore
 
 Carrying amount at the beginning of the 
 period/year                                          9.92       7.19
 
 Additional provision made during the 
 period/year                                          9.43      12.18
 
 Amounts used during the period/year                  4.35       9.45
 
 Carrying amount at the close of the 
 period/year                                         15.00       9.92
 
 The Company gives warranties for its products by undertaking to repair
 or replace the items that fail to perform satisfactorily during the
 warranty period. Provisions made at the period / year end represent the
 amount of expected cost of meeting such obligations of rectification /
 replacement.The timing of the outflows is expected to be within a
 period of eighteen months.
 
 8 No borrowing costs have been capitalised during the period / year.
 
 25 In case of one of the units of the Company, the wage agreement with
 workers expired in December, 2006. The Company has appealed to the
 Division Bench of Madras High Court against the Tribunal Order. The
 Company has made the pay- ments as per the Interim Order of the
 Division Bench. The Company has further recognised the liability in the
 books, based on the trend as existed in the industry for the location,
 over and above the amounts paid as per the Interim Order of the Madras
 High Court. Pending final order, the liability is not fully
 ascertainable. (See Schedule O, Note 1(e) also)
 
 9 Sales are net of trade discounts and includes direct sales
 compensation of Rs. 0.71 crore (Previous Year Rs. 2.57 crore).
 
 10 a) The provision for Current Tax includes Wealth Tax Rs. 0.06 crore
 (Previous Year Rs. 0.05 crore) and is net of minimum alternate tax of
 Rs. Nil crore (Previous Year Rs. 0.49 crore)
 
 b) The tax year of the Company is year ending 31st March. The Company
 has changed its financial year from July-June to April-March with
 effect from 1st July, 2010. Thus Company has closed its accounts for
 nine month period ended 31st March, 2011. The accounts reflect
 provision for taxation for the said period. The ultimate tax liability
 will be determined on the basis of the figures for the period 1st
 April, 2010 to 31st March, 2011.
 
 11 The financial statements of the Company for the year ended 30th
 June, 2010 were audited and reported by another firm of Chartered
 Accountants. The Company has changed its Financial Year from July-June
 to April – March with effect from 1st July, 2010. Accordingly, the
 figures for the nine months period ended 31st March, 2011 are not
 comparable with those presented as comparative figures for twelve
 months period ended 30th June 2010. Figures for the previous year have
 been regrouped / reclassified, wherever necessary.