1. (i) Contingent liabilities not provided for :
Claims against the Company not acknowledged as debts for :
Sales Tax Matters pending in appeal (Disputed in nature) Commercial
dispute with vendor
Legal cases and disputed claims (Personnel matters etc.)
The Contingent liabilities, if materialized, shall entirely be borne by
the company, as there is no likely reimbursement from any other party.
(ii) Estimated amount of contracts remaining to be executed on capital
account (net of advances) and not provided for Rs.1.11 Crore (Previous
year Rs.0.12 Crore).
(iii) In terms of Scheme of Arrangement between the Company, the
erstwhile Indo Gulf Corporation Limited (IGCL) and Hindalco Industries
Limited (Hindalco) approved by the Hon'ble High Courts at Allahabad and
Mumbai vide their orders dated 18th November, 2002 and 31st October,
2002 respectively, the Company may be liable to pay to Hindalco a
portion of the disputed demand of Income Tax pertaining to Fertiliser
Business of erstwhile IGCL. As Corporate Income Tax is assessed at
Company Level and several additions/deductions/allowances/disallowances
can be computed only at the Company Level, the quantification of
financial effect of such liability is not ascertainable and will be
decided on case to case basis as and when issues under demand will be
decided by the highest authority.
2. Under the Jute Packaging Material (Compulsory use of Packing
Commodities) Act, 1987, a specified percentage of fertilisers
dispatched was required to be supplied in Jute Bags up to 31.08.2001.
The Company made conscious efforts to use jute packaging material as
required under the Act. However, due to non-availability of material as
per the Company's product specifications as well as due to strong
customer resistance to use of Jute Bags, the specific percentage could
not be adhered to. The Company has received a show cause notice,
against which a writ petition has been filed with the High Court, which
is awaiting for hearing. At the request of Jute Commissioner various
writ petitions, filed in different High Courts by other aggrieved
parties, including the Company, are in the process of consolidation and
is to be decided by one court. Company has been advised that the said
levy is bad in law.
3. a) Advances recoverable include loan to a director and an officer
during the year NIL (Previous year NIL). Maximum balance outstanding
during the year also NIL (Previous year Rs.1.38 Crore).
b) Advances recoverable include loan to employees of Rs.0.30 Crore
(Previous year Rs.0.38 Crore) in the ordinary course of business and as
per service rules of the Company. Maximum balance outstanding during
the year Rs.0.42 Crore (Previous year Rs.0.52 Crore).
4. The Company is one of the Promoter members of Aditya Birla
Management Corporation Limited, a Company limited by guarantee, which
has been formed to provide a common pool of facilities and resources to
its members, with a view to optimize the benefits of specialisation and
minimise cost for each member. The Company's share of expenses under
the common pool has been accounted for under the appropriate heads.
Proportionate expenses reimbursed for utilising the services have also
been included in respective expenses head.
5. Rs. 0.02 Cr. (Previous year Rs.0.01 Cr.) and Rs.0.09 Cr. (Previous
year NIL) being net loss on account of exchange difference has been
adjusted to the cost of fixed assets/capital work-in-progress and
respective heads, of account in profit and loss account respectively.
6. In the Previous Year an amount of Rs.47.02 Crore was included in
Sales and Price Support under the then Retention Pricing Scheme of
Government of India, which was applicable up to 31.03.2003.
7. Miscellaneous expenses include donation of Rs.2.45 Crore (Previous
year NIL) paid to General Electoral Trust Mumbai for contribution for
political purposes as may be decided by the Trustee from time to time.
8. Payment against supplies from small scale and ancillary undertakings
are made in accordance with the agreed credit terms and to the extent
ascertained from available information, there was no amount overdue as
on 31st March, 2005.
9. All amounts in Rupees have been rounded off to Crore with Lacs in
decimal. Figures of Rs.50,000 or less has been shown at actual in
10. As the company's business activity falls within a single primary
business segment viz. `Fertiliser Business', the disclosure
requirements of Accounting Standard (AS-17) Segment Reporting issued
by the Institute of Chartered Accountants of India is not applicable.
The Company's business is in domestic market and hence there are no
reportable geographical segments.
11. Previous year's figures are as audited by another firm of Chartered
Accountants and have been regrouped wherever necessary to conform to
this year's classification.