1. Share Capital:
(b) Rights, Preferences and Restrictions attached to Equity Shares:
The Company has one class of equity shares having a par value of Rs. 1/-
per share. Each shareholder is eligible for one vote per share held.
The dividend proposed by the Board of Directors is subject to the
approval of the shareholders in the ensuing Annual General Meeting,
except in case of interim dividend. In the event of liquidation, the
equity shareholders are eligible to receive the remaining assets of the
Company after distribution of all preferential amounts, in proportion
to their shareholding.
(d) Shares Reserved for Issue under Options:
The Company has reserved Equity Shares for issue under the Employee
Stock Options Scheme. Please refer Note No. 41 on Employee Share-Based
Payment for details of Employee Stock Options Scheme.
2. Money Received against Share Warrants:
In accordance with the provisions of Chapter VII of the SEBI (Issue of
Capital and Disclosure Requirements) Regulations, 2009, the Company had
allotted 150,000,000 warrants on a preferential basis to the Promoter
Group on 22nd March, 2012, entitling them to apply for and obtain
allotment of one equity share of Rs. 1/- each fully paid-up at a price of
Rs. 144.35 per share against each such warrant at any time after the date
of allotment but on or before the expiry of 18 months from the date of
allotment in one or more tranches for which the Company has received Rs.
541.31 crore being 25% against these warrants. The Promoter Group
Companies applied for conversion of warrants into equity shares at
pre-determined price, accordingly, the Company has issued and allotted
150,000,000 equity shares of Rs. 1/- each at a premium of Rs. 143.35 per
share on 20th September, 2013, to the Promoter Group on payment of
balance amount of these warrants. The entire amount so received has
been utilised for various Greenfield and brownfield projects
3. Long-Term Borrowings:
(b) Term Loans of Rs. 7,227.54 crore from Banks and Rs. 149.18 crore from
Other Parties for Aditya Aluminium Project and Term Loan of Rs. 7,046.37
crore from Banks and Rs. 90.63 crore from Other Parties for Mahan
Aluminium Project have been prepaid by the Company on 17th September,
2013 and 3rd January, 2014, respectively.
(c) Term Loans from Banks of Rs. 7,365.00 crore to be secured by a fi rst
ranking charge/mortgage/security interest in respect of all the movable
assets of Mahan Aluminium Project (except Current Assets) and all the
immovable properties of Mahan Aluminium Project, both present and
future. However, security creation is pending for want of no due
certifi cate from previous term loan lenders.
Total loan of Rs. 7,500.00 crore carry interest at the State Bank of
India''s base rate plus 0.50% and are repayable in 40 quarterly
instalments commencing from 31st March, 2014 and ending on 31st
December, 2023. The repayment in each financial year in percentage is
1.8, 7.95, 9.2, 9.2, 10.2, 10.2, 10.2, 10.2, 11.1, 11.4 and 8.55 of the
(d) Term Loans from Banks of Rs. 8,850.00 crore to be secured by a fi rst
ranking charge/mortgage/security interest in favour of the State Bank
of India, in respect of all the movable and immovable properties of
Aditya Aluminium Project, both present and future. However, security on
2,579.89 acres of Project land is pending due to non-availability of
approval from the appropriate authority.
Above loans carry interest at the State Bank of India''s base rate plus
1.25% till project COD and 0.25% thereafter, and are repayable in 34
quarterly instalments commencing from 1st June, 2015 and ending on 1st
September, 2023. The repayment in each financial year in percentage is
2.32, 4.20, 6.20, 8.60, 9, 11.50, 16, 26 and 16.18 of the loan amount.
The Company will have an option to prepay all or any portion of these
loans, without payment of Prepayment Penalty within 30 (Thirty) days
after any annual Interest Reset Date.
(e) Term Loans from Other Parties include Foreign Currency Term Loans
from Export Development Canada (EDC) of USD 90.70 million (Previous
year USD 100.00 million) are secured by a fi rst charge on all movable
assets of the Mahan Aluminium Project and a second charge on the
current assets of the Company, both present and future.
Total loan of USD 100 million carry interest at the LIBOR plus 3.50%
and are repayable in 43 quarterly instalments commencing from 30th
June, 2013 and ending on 31st December, 2023. The repayment in each fi
nancial year in percentage is 9.30, 9.30, 9.30, 9.30, 9.30, 9.30. 9.30.
9.30, 9.30, 9.30 and 7 of the loan amount. Subject to the prevailing
RBI ECB Regulations, the Company may prepay all or any part of these
loans at any time.
(f) Deferred Payment Liabilities represent sales tax deferral which is
payable in yearly instalment by FY 2018.
4. Deferred Tax Liabilities (Net):
Major components of Deferred Tax arising on account of temporary timing
differences are given below:
(a) Working Capital Loan for Aluminium Business, granted under the
Consortium Lending Arrangement, are secured by a fi rst pari passu
charge on entire stocks of raw materials, work-in-process, fi nished
goods, consumable stores and spares and also book debts pertaining to
the Company''s Aluminium business. Working Capital Loan of State Bank
of India for the Copper business is secured by a fi rst pari passu
charge by way of hypothecation of stocks of raw materials,
work-in-process, fi nished goods and consumable stores and spares, and
also book debts and other movable assets of Copper business, both
present and future.
5. Long-Term Loans and Advances:
(Unsecured, Considered Good, unless otherwise stated)
(a) Loans, Advances and Deposits to Related Parties include Rs. 34.45
crore (Previous year Rs. 34.45 crore) towards balance with Trident Trust
which represents 16,316,130 equity shares of Rs. 1/- each fully paid-up
of the Company issued, pursuant to a Scheme of Arrangement approved by
the Hon''ble High Courts at Mumbai and Allahabad vide their Orders dated
31st October, 2002 and 18th November, 2002, respectively, to the
Trident Trust, created wholly for the benefit of the Company and is
being managed by trustees appointed by it. The tenure of the Trust is
up to 23rd January, 2017.
(b) Others include CENVAT credit receivable, VAT credit receivable,
Service Tax credit receivable, etc., primarily relating to ongoing
6. Revenue from Operations:
(i) Sales of Copper Products and Precious Metals are accounted for
provisionally pending fi nalization of price and quantity. Variations
are accounted for in the year of settlement. Final price receivable on
sale of above products, for which quotational price was not fi nalized
in the previous year, were realigned at the year end forward LME/LMBA
rate and reversal of Rs. 1.84 crore (Previous year Rs. 8.21 crore) was
accounted for. During the year, fi nal price was settled at Rs. 6.50
crore (Previous year Rs. 47.27 crore) and further reversal of sales of Rs.
4.65 crore (Previous year Rs. 39.06 crore) was taken into account. As on
31st March, 2014, sales of Copper Products and Precious Metals, pending
for price fi nalization, were realigned at the year end forward LME/
LMBA and reversal of sales of Rs. 7.83 crore (Previous year Rs. 1.84 crore)
was accounted for. Actual cash fl ow is expected on fi nalization of
quotational price and quantity in the subsequent financial year.
(ii) Include sales of DAP including nutrient-based subsidy of P&K Rs.
273.34 crore (Previous year Rs. 298.27 crore).
7. Cost of Materials Consumed:
(a) Purchase of Copper Concentrate is accounted for provisionally
pending fi nalization of contents in the concentrate and price.
Variations are accounted for in the year of settlement. Final price
payable on purchase of copper concentrate, for which quotational price
and quantity were not fi nalized in the previous year, was realigned
based on forward LME and LMBA rate at the year end of copper and
precious metals, respectively, and accordingly receivable of Rs. 122.82
crore (Previous year payable Rs. 141.51 crore) was accounted for. During
the year, fi nal price was settled at Rs. 248.90 crore (Previous year
payable Rs. 10.78 crore) and accordingly further net receivable of Rs.
126.08 crore (Previous year Rs. 130.73 crore) has been accounted for. As
on 31st March, 2014, receivable of Rs. 155.88 crore (Previous year Rs.
122.82 crore) was accounted for on realignment of unpriced copper
concentrate. Actual cash fl ow is expected on fi nalization of
quotational price and quantity in the subsequent financial year.
8. Exceptional Items
(a) Liability of Rs. 324.36 crore under UP Tax on Entry of Goods into
Local Areas Act, 2007 (UP Entry Tax)
(b) Liability of Rs. 71.62 crore under Madhya Pradesh Gramin Avsanrachna
Tatha Sarak Vikas Adhiniyam (MPGATSVA).
Both the above levies have been contested by the Company and appeals
against these are pending before the Hon''ble Supreme Court. In the
matter of UP Entry Tax, the Hon''ble Supreme Court has granted a stay on
the adverse order of the Hon''ble Allahabad High Court. In the matter of
MPGATSVA, the Supreme Court has not stayed the adverse order of the
Hon''ble Jabalpur High Court in a separate, but similar, case. Since in
both these matters an adverse order has been passed by a High Court
upholding the validity of the levy, and the amount of the levy has
either been paid or secured by bank guarantees provided by the Company,
the Statement of Profi t and Loss has been debited with the total
amount pertaining to these levies following principles of prudence. The
amount paid towards these levies has been shown as advance recoverable
in the Balance Sheet.
9. The Company had formulated a scheme of financial restructuring
under Sections 391 to 394 of the Companies Act, 1956 (the Scheme)
between the Company and its equity shareholders approved by the High
Court of judicature of Bombay to deal with various costs associated
with its organic and inorganic growth plan. Pursuant to this, a
separate reserve account titled as Business Reconstruction Reserve
(BRR) was created during the year 2008-09 by transferring balance
standing to the credit of Securities Premium Account of the Company for
adjustment of certain expenses as prescribed in the Scheme.
Accordingly, the Company has transferred Rs. 8,647.37 crore from
Securities Premium Account to BRR and till 31st March, 2013, Rs. 66.98
crore has been adjusted against BRR.
During the year, a provision of Rs. 86.06 crore has been made for
diminution in value of investment in Hindalco- Almex Aerospace Limited,
a subsidiary of the Company. The entire amount of provision has been
adjusted against BRR. Had the Scheme not prescribed aforesaid
treatment, the impact on results would have been as under:
Profi t for the year lower by Rs. 86.06 crore
Basic EPS lower by Rs. 0.43
Diluted EPS lower by Rs. 0.43
10. For the year ended 31st March, 2014, the Board of Directors of the
Company have recommended dividend of Rs. 1.00 per share (Previous year Rs.
1.40 per share) to equity shareholders aggregating to Rs. 241.55 crore
(Previous year Rs. 313.60 crore) including Dividend Distribution Tax.
11. Segment Reporting:
A. Primary Segment Reporting (by Business Segment):
(a) The Company has two reportable segments, viz., Aluminium and
Copper, which have been identifi ed in line with the Accounting
Standard-17 on Segment Reporting, taking into account the
organizational structure as well as differential risk and return of
these segments. Details of products included in each segments are as
(i) Aluminium: Hydrate & Alumina, Aluminium and Aluminium Product.
(ii) Copper: Continuous Cast Copper Rods, Copper Cathode, Sulphuric
Acid, DAP & Complexes, Gold and Silver.
(b) Inter-segment transfers are based on market rates.
12. Employee Share-Based Payment:
Employee Stock Options Scheme 2006 (ESOS 2006)
On 7th December, 2006, the Board of Directors approved the Employee
Stock Options Scheme 2006 (ESOS 2006) for issue of 3,475,000 stock
options to its permanent employees in the management cadre, in one or
more tranches, whether working in India or out of India, including the
Managing/Whole-time Directors of the Company. Each option when
exercised would be converted into one fully paid-up equity share of Rs.
1/- each of the Company. The options will vest in 4 equal annual
instalments after one year from the date of grant. The maximum period
of exercise is 5 years from the date of vesting, and these options do
not carry rights to dividends or voting rights till the date of
exercise. Further, on 23rd September, 2011, the ESOS 2006 has been
partially modifi ed and by which the Company may now issue 6,475,000
options to its eligible employees.
According to ESOS 2006, so far the Company has granted 4,328,159
options (Previous year 3,545,550 options) to its eligible employees,
out of which 1,169,574 options (Previous year 880,145 options) has been
cancelled/ lapsed and are available for grant as per term of the
During the year ended 31st March, 2014, the Company has allotted 4,800
fully paid-up equity share of Rs. 1/- each of the Company (Previous year
40,760) on exercise of options under ESOS 2006, for which the Company
has realised Rs. 0.05 crore (Previous year Rs. 0.40 crore) as exercise
money. The weighted-average share price for the year ended 31st March,
2014, over which options exercised was Rs. 115.20 (Previous year Rs.
Employee Stock Options Scheme 2013 (ESOS 2013)
During this year, the Company has instituted Employee Stock Options
Scheme 2013 (ESOS 2013), under which the Company may grant 5,462,000
stock options and restricted stock units (RSU) to the permanent
employees in the management cadre and Managing/Whole-time Directors of
the Company and its subsidiary companies in India and abroad, in one or
more tranches. The ESOS 2013 is administered by the Compensation
Committee of the Board of Directors of the Company (the Committee).
The option exercise price would be determined by the Committee, whereas
the RSU exercise price shall be the face value of the equity shares of
the Company as on the date of grant of RSUs. Each option and each RSU
entitle the holders to apply for and be allotted one fully paid-up
equity share of Rs. 1/- each of the Company upon payment of exercise
price during exercise period. The options will vest in 4 equal annual
instalments after one year of the date of grant, whereas RSU will vest
at the end of three years from the date of grant. The maximum period of
exercise is 5 years from the date of vesting and these options/RSUs do
not carry rights to dividends or voting rights till the date of
exercise. Further, cancelled/lapsed options and RSUs are also available
The Company has various schemes (funded/unfunded) for payment of
gratuity to all eligible employees calculated at specifi ed number of
days (ranging from 15 days to 1 month) of last drawn salary depending
upon the tenure of service for each year of completed service, subject
to minimum service of fi ve years payable at the time of separation
upon superannuation or on exit otherwise.
B. In respect of defi ned Contribution Schemes:
(a) As required under Guidance Note on Implementation of Accounting
Standard-15 (Revised) issued by the ICAI in respect of exempted
Provident Fund, the Company has carried out actuarial valuation to
ascertain shortfall in interest, if any, payable to the members of
Provident Fund, and has made appropriate provision in the books. The
Company contributes 12% of salary for all eligible employees towards
Provident Fund managed either by approved trusts or by the Central
Government. The amount debited to the Statement of Profi t and Loss
during the year was Rs. 70.90 crore (Previous year Rs. 62.56 crore). In
view of the typical nature of such Provident Fund scheme involving defi
ned benefit underpin in respect of interest payable to members as
declared by the Employees'' Provident Fund Organisation, the defi ned
benefit obligation relating to interest shortfall is considered to be
Other Long-Term Employee benefits.
(b) The Company contributes a certain percentage of salary for all
eligible employees in the managerial cadre towards Superannuation Funds
managed by approved trusts or by Life Insurance Corporation of India.
The amount debited to the Statement of Profi t and Loss during the year
was Rs. 13.05 crore (Previous year Rs. 12.52 crore).
13 Derivative Financial Instruments:
(a) The Company has adopted Accounting Standard-30, Financial
Instruments: Recognition and Measurement, issued by the Institute of
Chartered Accountants of India so far as it relates to derivative
(b) In the ordinary course of business, the Company is exposed to risks
resulting from changes in prices of commodity, exchange rate fl
uctuation and interest rate movements. It manages its exposure to these
risks through derivative financial instruments. It uses derivative
instruments such as forwards, futures, swaps and options to manage
these risks. These derivative financial instruments reduce the impact
of both favourable and unfavourable fl uctuations. Except where noted,
the derivative contracts are marked- to-market (MTM) and the related
gains and losses are included in the Statement of Profi t and Loss in
the current accounting period.
The Company''s risk management activities are subject to the management,
direction and control of Risk Management Board (RMB). The RMB is
composed of two directors including Managing Director, Chief Financial
Officer and other offi cers and employees selected by the Managing
Director. The RMB reports to the Board of Directors on the scope of its
The decision of whether and when to execute derivative financial
instruments along with its tenure can vary from period to period
depending on market conditions and the relative costs of the
instruments. The tenure is always linked to the timing of the
underlying exposure, with the connection between the two being
regularly monitored. The Company is exposed to losses in the event of
non-performance by the counterparties to the derivative contracts. All
derivative contracts are executed with counterparties that, in our
judgment, are creditworthy. The credit levels are reviewed to ensure
that there is not an inappropriate concentration of outstanding to any
Commodity Price Risk
Copper and Precious Metals
This business is conducted under a conversion model. The prices of
input and output are derived from the same benchmark and/or are linked
to each other through a defi ned formula. The objective of risk
management is to attempt to use derivatives to match the price fl
uctuations arising out of the timing mismatch in pricing the input and
output so as to ''pass through'' the change in input cost to customers to
make the margins immune to the fl uctuations in prices of the input and
This business is vertically integrated. The main raw material, viz.,
bauxite (mostly mined from own mines) and other purchased raw materials
do not have any linkage with the output price which is Aluminium LME
prices. When the prices of input(s) and output(s) do not follow the
above condition, then the risk management attempts to use derivatives
so as to protect the margins from adverse movements in prices on either
side, i.e., from a rise in input cost or from a fall in output price.
As a condition of sale, customers often require the Company to enter
into fi xed price commitments. These commitments expose the Company to
the risk of fl uctuating aluminum prices between the time the order is
committed and the time that the material is shipped. The Company may
enter into derivative financial instruments to mitigate the risk
arising out of the fi xed price commitments. Consequently, the gain or
loss resulting from movements in the price of aluminum on these
contracts would generally be offset by an equal and opposite impact on
the net sales and purchases being hedged.
Foreign Currency Exchange Risk
Exchange rate movements, particularly the United States Dollar (USD)
and Euro (EUR) against Indian Rupee (INR), have an impact on our
operating results. In addition to the foreign exchange fl ow from
exports, the commodity prices in the domestic market are derived based
on the landed cost of imports in India where LME prices and USD/INR
exchange rate are the main factors. In case of conversion business, the
objective is to match the exchange rate of outfl ows and related infl
ows through derivative financial instruments. With respect to
Aluminium business, where costs are predominantly in INR, the
strengthening of INR against USD adversely affects the profitability
of the business and benefits when INR depreciates against USD. The
Company enters into various foreign exchange contracts to protect profi
tability. The Company also enters into various foreign exchange
contracts to mitigate the risk arising out of foreign currency exchange
rate movement in foreign currency contracts executed with foreign
suppliers to procure capital items for its project activities.
Copper concentrate is purchased on future pricing model based on
month''s average LME (in case of copper)/LBMA (in case of gold and
silver). Since the value of the concentrate changes with response to
change in commodity pricing indices, embedded derivatives (ED) are
identifi ed and segregated in the contract. The ED so segregated is
treated like commodity derivative and qualify for hedge accounting.
These derivatives are put into a Fair Value hedge relationship with
The objective of hedge designation of the embedded commodity derivative
is to offset the volatility in the Statement of Profi t and Loss due to
change in value of un-priced inventory with response to LME/LBMA.
14. Contingent Liabilities and Commitments:
A. Contingent Liabilities
(a) Claims against the Company not
acknowledged as debt:
Following demands are disputed by the
Company and are not provided for:
(i) Demand notice by Asstt. Collector,
Central Excise, Mirzapur, for
excise duty on power generated by the
Company''s captive power plant, Renusagar
Power Company Limited (Since amalgamated). - 9.12
*Favourable judgment has been received
from the Hon''ble Delhi High Court.
(ii) Demand of interest on past dues of the
Aluminium Regulation Account up to 31st
December, 1987. 6.33 6.33
* The demand is in dispute with the
Controller of Aluminium Regulation Account.
(iii) Retrospective Revision of Water Rates by
UP Jal Vidyut Nigam Limited (April 1989
to June 1993 and January 2000 to
January 2001). 4.08 4.08
* Write petition pending with Lucknow
Bench of Allahabad High Court. The demand
for arrears stayed vide order dated
(iv) Transit fees levied by Divisional Forest
officer, Renukoot, on Coal and Bauxite. 106.65 134.38
* Appeal pending with the Hon''ble High Court of Allahabad, and payment
of Transit Fee has been stayed. According to the legal opinion received
by the Company, the Forest Department has no authority to levy such
fees. The Company has fi led a transfer application before the Hon''ble
Supreme Court. The Hon''ble Supreme Court of India on while issuing
notice on our Transfer Petition stayed the further proceedings of the
Company''s Writ Petition pending before the Hon''ble Allahabad High
(v) M.P. Transit Fee on Coal demanded by
Northern Coal Fields Limited. 23.77 23.43
* The Company had challenged the demand towards MP Transit Fee on Coal
and fi led Writ Petition before the Hon''ble Jabalpur High Court. The
Hon''ble High Court has struck down the levy and also ordered for refund
of the amount paid under protest. The State government has fi led an
Appeal against the order of the Hon''ble Supreme Court of India, and the
Hon''ble High Court''s order has been stayed. The Counter affi davit in
the matter has been fi led. The rejoinder has also been fi led by the
state. To be listed along with the similar matter before the Supreme
Court of India.
(vi) Imposition of Cess on Coal by
Shaktinagar Special Area Development
Authority. 11.17 9.38
* The Writ pending before Allahabad High Court, Allahabad. Demand and
levy stayed. However, the Company has moved a transfer petition before
the Hon''ble Supreme Court for tagging the matter with CA No. 1883 of 06
(ORISED Matter). The matter is tagged with ORISED and to be heard by
the Nine Judges Bench of the Hon''ble Supreme Court.
(vii) Demand of Royalty on Vanadium by
District Mining Officer, Lohardaga. 7.96 8.44
* Appeal is pending with the Hon''ble High Court of Allahabad. The
demand has been stayed on certain conditions.
(viii) The demand of Excise Duty on gold. 155.31 155.31
* Part of the demand was confirmed, against which our ROM request is
pending at CESTAT. Department''s appeal is pending before the Hon''ble
Supreme Court for the part of the demand and penalty that was dropped.
(ix) Tax under MPGATSVA, 2005 @ 5% on basic
price of coal, w.e.f. 30th September, 2005
by M.P. State Government. - 60.76
* Liability provided in the books of account.
(x) Demand raised on the assessment for entry
tax with retrospective effect from the
period November 1999 to till date. - 271.96
* Liability provided in the books of account.
(xi) Demand raised on assessment under CST
Act and UP Sales Tax Act. 6.39 6.39
* Demand has been quashed at fi rst appeal and second appeal stage.
However, Dept. has gone in the revision before the Hon''ble High Court.
(xii) Revision of surface rent on land by the
Government of Jharkhand, w.e.f.
16th June, 2005. 26.18 22.56
* Matter is in dispute at the Hon''ble High Court of Jharkhand.
(xiii) Demand made by Nayab Tehsildar Kusmi/
Collector under Chhattisgarh as per
Adhosanrachna Vikas evam Parayavaran
Upkar Adhiniyam, 2005 @ 5% as
environment tax on royalty plus
5% as development tax. 6.60 5.55
* The Writ petition, which has been fi led by the Company before the
Hon''ble High Court of Chhattisgarh at Bilaspur, has been transferred to
the Hon''ble Supreme Court and tagged with other Civil Appeals.
(xiv) Service tax paid on Goods Transport
Agency and Business Auxiliary Services. 11.27 11.27
* Commissioner has confirmed the demand. Appeal is being filed at
CESTAT New Delhi.
(xv) M.P. Transit Fee on Bauxite. 1.30 1.30
Company has fi led Writ Petition before the Hon''ble Jabalpur High
Court. The Hon''ble High Court has struck down the levy and also ordered
for refund of the amount paid under protest. The State government has
fi led an appeal against the order of the Hon''ble High court.
(xvi) Demand for Entry Tax relating to valuation
dispute of 2004-05 to 2005-06, for which
appeals have been filed. 1.18 1.18
* Appeal has been fi led with Additional CCT, Sambalpur.
(xvii) CST demand on reopening of assessments
for 1999-00 to 2003-04. 8.81 8.81
* Appeals have been fi led.
(xviii) Demand of penalty on excess CENVAT
Credit taken. 1.09 1.09
* Appeal is pending with CESTAT, Mumbai.
(xix) Demand for Sales Tax u/s 15B for AYs
2001-02 and 2002-03. 7.96 7.96
* Appeal is pending with J.C. Appellate Authority, Baroda.
(xx) Service Tax on insurance policy
attributable to Renusagar. 3.97 3.97
* Commissioner has confirmed the demand. Appeal is pending before the
CESTAT, New Delhi.
(xxi) Disallowance of CENVAT credit. 5.29 5.29
* The matter is pending with CESTAT, Ahmedabad.
(xxii) Demand raised on assessment under CST
Act and APGST Act for various years. 5.77 6.55
* Appeals have been fi led with appropriate authorities.
(xxiii) Demand for Service Tax on Consulting
Engineer Services and Scientific &
Tech Service. 3.84 3.84
* Appeal is pending with Commissioner (Appeals), Ahmedabad.
(xxiv) Excise Duty on Dross. 19.78 16.16
* Company has challenged the letter issued by Excise Department to pay
Excise Duty on Dross before the Hon''ble Allahabad High Court.
(xxv) Alleged CENVAT taken without receipt of
Alumina Hydrate inside the factory. 3.46 3.46
* Appeal fi les with Hon''ble CESTAT.
(xxvi) Alleged CENVAT availed on the Input
services at captive Mines. 36.05 36.07
Appeal is pending with CESTAT.
(xxvii) CENVAT of Service Tax Credit availed
on Supplementary Invoices. 3.12 3.12
* Pending with appropriate Authority.
(xxviii) Clearence of Silver at Nil Rate of
Duty under Notification No. 5/2006. 8.96 8.96
* Appeal pending before CESTAT.
(xxix) Excess rebate has been sanctioned to
the extent duty paid by supplementary
invoices 5.08 7.65
* Appeal is pending with Commissioner of Customs (Appeals),
(xxx) Disallowance of CENVAT on input services. 6.79 5.40
* Pending with appropriate Authority.
(xxxi) Service Tax on reverse charge basis. - 31.10
* Since provided.
(xxxii) Parallel operation charges on
capacity of Captive Power Plant by
Madhya Pradesh Electricity Regulatory
Commission. 7.05 -
* Matter is pending before the Hon''ble High Court of Madhya Pradesh at
Jabalpur. The Hon''ble High Court passed an order on 20.9.2013 and
stayed the operation of order passed by MPERC subject to deposit of 50%
of the amount.
(xxxiii) Other Contingent Liabilities in
respect of Excise, Customs,
Sales Tax etc., each being for
less than Rs. 1 crore. 15.51 13.33
* The demands are in dispute at various legal forums.
(b) Corporate Guarantees Outstandings 5,287.03 488.98
(Rs. 5,246.47 crore* (Previous year
Rs. 448.42 crore) given on behalf of
* Includes Rs. 5,000 crore given to lender against loan provided to a
subsidiary company, amount of loan outstanding as on 31st March 2014,
is Rs. 4,950.
(c) Other money for which the Company is contingently liable:
i. Bills Discounted with Banks 3.53 -
ii. Customs Duty on Capital Goods and Raw
Materials imported under EPCG Scheme/
Advance License, against which export
obligation is to be fulfi lled
(excluding cenvatable portion). 368.51 359.09
iii. The Company has received a notice dated 24th March, 2007, from
Collector (Stamp), Kanpur, Uttar Pradesh, alleging that stamp duty of Rs.
252.96 crore is payable in view of order dated 18th November, 2002, of
the Hon''ble High Court of Allahabad approving scheme of arrangement for
merger of Copper business of Indo Gulf Corporation Limited with the
Company. The Company is of the opinion that it has a very strong case
as there is no substantive/computation provision for levy/calculation
of stamp duty on court order approving scheme of arrangement under
Companies Act, 1956, within the provisions of Uttar Pradesh Stamp Act.
Moreover the properties in question are located in the State of Gujarat
and thus the Collector (Stamp), Kanpur, has no territorial jurisdiction
to make such a demand. It is pertinent to note that the Company in
2003-04 has already paid stamp duty which has been accepted as per the
provisions of the Bombay Stamp Act 1958 with regard to transfer of
shareholding of Indo Gulf Corporation Limited as per the Scheme of
Arrangement. Furthermore, the demand made is on an incorrect
assumption. The Company''s contention amongst the various other grounds
made is that the demand is illegal, against the principles of natural
justice, incorrect, bad in law and malafi de. The Company has fi led a
writ petition before the Hon''ble High Court of Allahabad, inter alia,
on the above said grounds, which is pending determination.
iv. Against the notifi cations issued by the State Electricity
Regulatory Commissions of Uttar Pradesh, Odisha and Madhya Pradesh
states under the provisions of Electricity Act, 2003, in respect of
Renewable Purchase Obligation (RPO), the Company has fi led writ
petitions before the jurisdictional high courts on the ground, inter
alia, that RPO cannot be made applicable to captive users and the High
Court(s) at Allahabad, Cuttack and Jabalpur have granted stay on the
applicability of the RPO. Further, the Company has received favorable
order from the Appellate Authority and Uttar Pradesh Regulatory
Commission on applicability of RPO to units with Co-generation
facility. In view of pending writ petitions and favourable order
obtained from Appellate Authority, no provision has been considered
necessary at this stage.
v. The assessing offi cer, while framing the assessment for AYs
2008-09, 2009-10 and 2010-11, has made adjustment, inter alia,
amounting to Rs. 270.32 crore, Rs. 1,063.89 crore and Rs. 316.10 crore to
total income of respective assessment years on account of purported
arms'' length fee for corporate guarantee provided to foreign banks for
granting loan to a wholly owned subsidiary of the Company, viz., AV
Minerals (Netherlands) N.V. The Company has fi led appeals against
these orders. The Company has been advised that, considering the facts
of the case, no provision is necessary for these adjustments.
Estimated amount of contracts remaining to be executed on capital
(a) account and not provided for net of advances 1,181.44 2,957.37
(b) The Company, along with Aditya Birla Nuvo Limited, Grasim
Industries Limited and Birla TMT Holdings Pvt. Limited (the Sponsors),
being promoters of Idea Cellular Limited (Idea), has given the
following undertakings to the Facility Agent:
i. The Sponsors shall collectively continue to hold at least 33% of the
equity capital of Idea till the end of FY 2015-16 and shall not,
without prior written approval of the Facility Agent, divest, transfer,
assign, dispose of, pledge, charge, create any lien or in any way
encumber 33% of shareholdings in Idea. Consequent upon the infusion of
fresh equity capital of Idea, if the Sponsors'' stake gets diluted from
40% to 33% in the equity capital of Idea, the Sponsors agree and
undertake to obtain the prior consent of the Rupee Facility Agent and,
in other circumstances, the Sponsors agree and undertake to obtain the
prior consent of the secured lenders representing 51% of the aggregate
outstanding secured loans.
ii. The Sponsors shall collectively continue to hold 26% of the equity
capital of Idea after FY 2015-16 and shall not, without the prior
written approval of the Rupee Facility Agent, divest, transfer, assign,
dispose of, pledge, charge, create any lien or in any way encumber 26%
shareholdings in the capital of Idea.
iii. Not without prior approval of the Facility Agent in writing divest
shareholdings in the equity capital of Idea that may result in a single
investor along with its affi liates holding more than 25% of the equity
capital of Idea.
(c) As the Parent Company, Hindalco has given the following
undertakings to the lenders of Utkal Alumina International Limited
(UAIL), a wholly owned subsidiary of the Company.
i. To hold minimum 51% equity shares in UAIL.
ii. To ensure to meet the Financial Covenants, except Fixed Asset
Coverage Ratio, as provided in the loan agreements.
15. Both the green field projects of the Company, viz., Aditya
Aluminium and Mahan Aluminium, as well as the green field project of
its wholly-owned subsidiary company, Utkal Alumina International
Limited have started operations during the year and are in the process
of ramp up.
16. Information related to Micro, Small and Medium Enterprises, as
defi ned in the Micro, Small and Medium Enterprises Development Act,
2006 (MSME Development Act), are given below. The information given
below have been determined to the extent such enterprises have been
identifi ed on the basis of information available with the Company:
17. The Company is one of the promoter members of Aditya Birla
Management Corporation Private Limited (ABMCPL), a Company limited by
guarantee which has been formed to provide common facilities and
resources to its members, with a view to optimize the benefits of
specialization and minimize cost for each member. The Company is one of
the participants in the common pool and shares the expenses incurred by
ABMCPL and accounted for under appropriate heads.
18. Related Party Disclosures:
A. List of Related Parties:
(a) Enterprises where control exists: i. Subsidiaries:
1 Hindalco Guniea SARL
2 Minerals & Minerals Limited
3 Aditya Birla Chemicals (India) Limited
4 Utkal Alumina International Limited
5 Utkal Alumina Technical and General Services Limited
6 Suvas Holdings Limited
7 Renukeshwar Investments & Finance Limited
8 Renuka Investments & Finance Limited
9 Dahej Harbour and Infrastructure Limited
10 Lucknow Finance Company Limited
11 Hindalco-Almex Aerospace Limited
12 Hindalco do Brasil Indústria e Comércio de ALumina Ltda., (w.e.f.
1st August, 2013)
13 Tubed Coal Mines Limited
14 East Coast Bauxite Mining Company Private Limited
15 Mauda Energy Limited
16 Birla Resources Pty. Limited
17 Aditya Birla Minerals Limited
18 Birla Maroochydore Pty. Limited
19 Birla Nifty Pty. Limited
20 Birla Mt. Gordon Pty. Limited
21 A V Minerals (Netherlands) N.V.
22 A V Metals Inc.
23 Novelis Inc.
24 Novelis (India) Infotech Ltd.
25 Novelis No. 1 Limited Partnership
26 4260848 Canada Inc.
27 4260856 Canada Inc.
28 8018227 Canada Inc.
29 8018243 Canada Limited
30 Novelis Cast House Technology Ltd.
31 Novelis Corporation (Texas)
32 Aluminum Upstream Holdings LLC (Delaware)
33 Eurofoil Inc. (USA) (New York)
34 Logan Aluminium Inc. (Delaware)
35 Novelis Acquisitions LLC (Delaware)
36 Novelis Brand LLC (Delaware)
37 Novelis PAE Corporation
38 Novelis North America Holdings Inc.
39 Novelis South America Holdings LLC
40 Novelis Delaware LLC (Delaware)
41 ALBRASILIS - Aluminio do Brasil Industria e Comércio Ltda.
42 Novelis do Brasil Ltda.
43 Novelis Laminés France SAS
44 Novelis PAE SAS
45 Novelis Aluminium Beteiligungs GmbH
46 Novelis Deutschland GmbH
47 Novelis Sheet Ingot GmbH
48 Novelis Aluminium Holding Company
49 Novelis Italia SpA
50 Al Dotcom Sdn Berhad
51 Alcom Nikkei Specialty Coatings Sdn Berhad
52 Aluminum Company of Malaysia Berhad
53 Novelis de Mexico S.A. de C.V.
54 Novelis Madeira, Unipessoal, Limited
55 Novelis Korea Limited
56 Novelis AG
57 Novelis Switzerland SA
58 Novelis UK Ltd.
59 Novelis Europe Holdings Limited
60 Novelis Services Limited
61 Novelis (Shanghai) Aluminum Trading Co., Ltd.
62 Novelis (China) Aluminum Products Co., Ltd.
63 Novelis MEA Ltd. (Dubai)
64 Novelis Vietnam Company Limited
65 Novelis Asia Holdings (Singapore) Pte. Ltd., w.e.f. 5th December,
2013 (b) Other Related Parties:
1 Aditya Birla Science and Technology Company Limited
2 Idea Cellular Limited
3 Aluminum Norf GmbH
4 Consorcio Candonga
5 Deutsche Alumnum Verpackung Recycling GmbH
6 France Aluminum Recyclage SA ii. Joint Ventures:
1 Mahan Coal Limited
2 Hydromine Global Minerals (GmbH) Limited
3 MNH Shakti Limited iii. Trust of the Company:
1 Trident Trust
iv. Key Managerial Personnel:
Mr. D. Bhattacharya - Managing Director
Mr. Satish Pai - Deputy Managing Director (w.e.f. 13th August, 2013)
19. Previous year''s figures have been reclassified/regrouped to
conform to this year''s classification.