1.  Background
 
 Hitachi Home and Life Solutions (India) Limited (‘the Company) was
 incorporated in December 1984 as Acquest Air conditioning Systems
 Private Limited under the provisions of Companies Act, 1956.
 
 The Company is engaged in the business of manufacturing, selling and
 trading of ‘Hitachi brand of air conditioners, refrigerators and
 chillers. Manufacturing facility for air conditioners is set up at Kadi
 (North Gujarat) and Jammu. The Company performs its marketing
 activities through eighteen branches.
 
 The Company is a subsidiary of Hitachi Appliances, Inc., Japan.
 
 2.  Segment Reporting
 
 Business Segment:
 
 The Company is engaged in the business of manufacturing, trading and
 other related services of Air Conditioners, Chillers and Refrigerators.
 Since the Companys business falls within a single business segment of
 Cooling Products for comfort and commercial use, disclosures under
 Accounting Standard (AS) 17 – Segment Reporting are not reported upon
 separately.
 
 Geographical Segment:
 
 Secondary segment reporting is based on the geographical areas of
 operations. The geographical segments have been identified based on
 revenues within India (sales to customers within India) and revenues
 outside India (sales to customers located outside India).
 
 Since the export market revenue, results and assets constitute less
 than 10% of the total revenue, results and assets, the same has not
 been disclosed.
 
 3.  Related Party Transactions
 
 (a) List of related Parties and Relationship
 
 Relation Party
 
 A.  Related parties exercising control Hitachi Ltd., Japan, (ultimate
 Holding Company)
 
 Hitachi Appliances Inc., Japan (Holding Company)
 
 B.  Parties under common control (Fellow Subsidiaries) Hitachi Air
 Conditioning Products (M) Sdn. Bhd.
 
 Hitachi Asia Ltd. – Singapore
 
 Hitachi Household Appliances (Wuhu) Co. Ltd.
 
 Hitachi Procurement Service Co. Ltd.
 
 Hitachi Metglas (India) Pvt. Ltd.
 
 Luvata Hitachi Cable (Thailand) Ltd.
 
 Shanghai Hitachi Electrical Appliances Co. Ltd.
 
 Shanghai Hitachi Household Appliances Co.
 
 Hitachi Consumer Products (Thailand) Ltd.
 
 Hitachi Koki India Ltd.
 
 Hitachi Air Conditioning & Refrigerating Products (Guangzhou) Co. Ltd.
 
 Hitachi India Pvt. Ltd.
 
 Hitachi Lift India Private Ltd.
 
 Hitachi Transport System India Pvt. Ltd.
 
 C.  Key Managerial personnel 
 
 Mr. Motoo Morimoto (Managing Director)
 
 Mr. Vinay Chauhan (Executive Director)
 
 Mr. Amit Doshi (Executive Director)
 
 Mr. Anil Shah (Executive Director)
 
 4.  Contingent Liabilities
 
 Particulars                                  As at         As at
 
                                     March 31, 2011  March 31, 2010
 
 Income tax matters                               —           1,266
 
 Excise duty, service tax, sales tax 
 and customs duty matters under dispute:
 
 Service tax                                 19,202          22,403
 
 Sales tax                                   32,615          29,895
 
 Customs duty                                    92              92
 
 Guarantees given by the bankers to 
 various authorities on behalf of the 
 Company                                      2,430           4,349
 
 Miscellaneous Claims against the 
 Company not acknowledged as debts            5,035           4,231
 
 Total                                       59,374          62,236
 
 5.  Capital Commitments
 
 The estimated amount of contracts remaining to be executed on capital
 account and not provided for (net of advances) Rs. 28,516 (Previous
 year: Rs. 42,980).
 
 6.  Based on information available with the Company, there are no
 suppliers who are registered as micro, small or medium enterprise under
 The Micro, Small and Medium Enterprise Development Act, 2006 (Act)
 till March 31, 2011. Accordingly, no disclosures are required to be
 made under said Act and Schedule VI to the Companies Act, 1956.
 
 7.  Income Tax
 
 Current Tax -
 
 The Company has taxable earnings. Provision for tax has been computed
 under normal taxation after claiming deductions under section 80-IB of
 Income Tax Act, 1961 for Jammu unit.
 
 8. Disclosure as per Accounting Standard-15(Revised) on Employee
 Benefit.
 
 The Company has a defined benefit gratuity plan. Every employee who has
 completed five years or more of service gets a gratuity on departure at
 15 days salary (last drawn salary) for each completed year of service.
 The scheme is funded with Life Insurance Corporation in the form of a
 qualifying insurance policy.
 
 The following tables summarise the components of net benefit expense
 recognised in the profit and loss account and the funded status and
 amounts recognised in the balance sheet for the plan.
 
 9.  The Company is eligible for refund of excise duty paid on goods
 manufactured and removed from Jammu unit, other than the amount of duty
 paid by utilisation of CENVAT credit, in terms of Notification No.
 56/2002-CE dated 14-11-2002. Excise duty recovered as disclosed in the
 Profit and Loss Account is net of such refund of Rs.52,551 (Previous
 year Rs. 39,453).
 
 10.  The Company avails input tax credit on purchases made by it from
 the dealers availing VAT Remission Scheme under the Jammu and Kashmir
 Value Added Tax Act, 2005 (J&K VAT Act) since FY 2005-06. During the
 year, the Company has accounted input tax credit as per section 21 & 22
 of J&K VAT Act of Rs. 17,572 (aggregated till date Rs. 57,808) net of
 Rs. 4,720 (aggregated till date Rs. 38,061), being the amount adjusted
 against the payment of Central Sales Tax and Value Added Tax
 liabilities on sales made from Jammu and Kashmir unit (VAT Set off).
 In respect of the said matter, the Company has received a demand of Rs.
 1,779 being the VAT set off claimed in FY 2005-06, which has been
 challenged by the Company in High Court of Jammu & Kashmir and the
 matter is subjudise till the date of balance sheet. The Company, based
 on the external opinion, has considered the entire input tax credit of
 Rs. 57,808 (net of VAT setoff claimed of Rs. 38,061) as recoverable.
 
 11.  The Company has working capital facilities from banks secured by
 hypothecation of inventories, book debts and movable fixed assets and
 by equitable mortgage of certain immovable fixed assets of the Company.
 
 12.  The Company has paid custom duties under protest of Rs. 26,819
 (previous year Rs.27,527) during the year for which provision has been
 created by debiting ‘raw material consumed and cost of trading goods
 sold account.
 
 13.  During the year, Department of Scientific and Industrial Research
 (DSIR), Ministry of Science and Technology, Government of India, has
 accorded recognition to In-house research and development centre of the
 Company. Pursuant thereto, the Company has applied to DSIR for claiming
 deduction under the Income tax Act, 1961, which is yet to come.
 Accordingly, the Company has claimed weighted deductions of research
 and development expenditure of Rs. 70,562, as entitled under section
 35(2AB) of the Income tax Act, 1961.
 
 14.  The Company accrues certain sales related expenses on an estimated
 basis, which are reviewed at the each period end and any excess or
 short provisions are reversed or accounted for in respective expense
 heads. Accordingly, Selling & Distribution Expenses are net of write
 back of excess provision of earlier years amounting to Rs. 70,491
 (Previous year: Rs. 25,975).
 
 15 Prior year comparatives
 
 The previous year figures have been regrouped wherever necessary to
 confirm to current years classification.