As at          As at
 
                                                31.03.2011     31.03.2010
 
 A) Contingent Liabilities not provided for in respect of :-
 
 i) Outstanding Bills Discounted with Banks             -         349.05
 
 ii) Outstanding Letter of Credit                    9.53           5.50
 
 iii) Demand from Sales Tax authority:
 
 a) Certain disallowances in the Sales Tax 
 were confirmed                                    243.64         204.93
 against the company and an appeal 
 before the Appellate
 and Revisional Board has been filed and 
 the management is of the opinion that it 
 will obtain full relief.
 
 b) Sales Tax appeal pending before 
 Appellate Commissioner                             17.33         413.76
 
 iv) Income Tax demand under appeal                107.82          34.33 
 
 v) Demand from a lessor for interest 
 on differential rent                               70.14          70.14 
 
 vi) Refund of excise duty under appeal 
 by the Department                                      -          16.10
 
 vii) Demand of Provident Fund Damages by the       24.39          24,39
 Provident Fund Authorities, West Bengal
 
 viii) Electricity duty demanded by 
 Govt, of Bihar, Govt, appealed                    103.10              -
 in Supreme Court
 
 ix) Demand from custom authorities for 
 non fulfilment of export                          105.00         105.00
 obligation in respect of an erstwhile unit
 
 B) i) Capital Commitments outstanding             242.58          58.25
 (net of advances Rs.100.55) (Previous
 year Rs.35.54)
 
 ii) Bank Guarantees Outstanding                   724.60         224.29
 (Pledge of Fixed Deposit of Rs.34.62) 
 (Previous year Rs.30.58) 
 
 iii) Corporate guarantee outstanding 
 given to a Bank against load acquired            3568.40              -
 by a subsidiary company from the bank 
 (US million) 
 
 C) Interest income of Rs.36.25 for the year (till date Rs.145.00) on an
 Inter Corporate Deposit of Rs. 250.00 (previous year Rs.250.00) has not
 been recognised in view of non recovery of earlier interest.  The
 Company is confident of recovering the principal and interest of
 Rs.27.21 recognised in earlier years.
 
 D) i) Fringe Benefit Tax has been abolished from current year 2009-10.
 However in view of the interim stay
 
 granted by the Hon''ble High Court at Calcutta, no liability has been
 provided for earlier years.
 
 ii) In view of the favourable order from the Hon''ble Supreme Court in
 respect of dividend tax, the Company is depositing dividend tax to the
 extent of 40% of the applicable rates. However identical matter in
 respect of other companies are pending before the Hon''ble Supreme
 Court. The Company is continuing to provide dividend tax at applicable
 rates.
 
 iii) During the year the Company has assessed the recoverability of
 Minimum Alternate Tax (MAT) for set off with future normal taxes and a
 sum of Rs. 241.81 for earlier year have been reversed. Based on
 projections made by the management and current trend of working of the
 Company the management is virtually certain of recovering the MAT
 credit entitlements and a sum of Rs.407.01 as on 31.03.2011 has been
 carried forward as MAT credit available for set off in future years.
 
 iv) Deferred Tax Assets has been recognised as capital loss incurred
 during the year based on the profit available in future as ascertained
 by the management.
 
 v) No provision for dividend and corresponding dividend distribution
 tax has been recognized in respect to 7135730 equity shares held by the
 beneficiary trusts in view of waiver letter received from them.
 
 E) i) The Hon''ble High Court at Calcutta had passed an order in the
 year 2009-10 in favour of landlord of
 
 a tenanted property enhancing the rent w.e.f. from April 2000 over and
 above its interim order issued earlier, as a result of which an
 additional rent of Rs.410.82 and interest and cost thereon to the
 extent of Rs. 182.59 accrues to the landlord. The Company has filed an
 appeal before the Division Bench of Hon''ble High Court at Calcutta and
 has obtained a stay on the execution of the decree awarded in favour of
 the landlord. However, in compliance to the earlier interim order the
 company has paid the enhanced rent and hence does not envisage any
 further liability.
 
 ii) A matter of industrial dispute against a unit with regard to 12
 workers is subjudice. The company has provided an estimated liability
 of Rs.12.00 and does not anticipate any more liability.
 
 iii) In earlier years 146.92 acres of land around Majhaulia related to
 Sugar division has been surrendered to the Government of Bihar The
 Bihar Land Reforms (fixation of ceiling area and acquisition of surplus
 land) Act and Rules, 1961. Since the compensation in this respect has
 not been determined, the same will be accounted upon receipt.
 
 F) The Net Worth of the subsidiary company M/s North Tukvar Tea Company
 Ltd. is negative. No provision in value of the investment amounting to
 Rs.356.20 and for advances and security deposit of Rs.258.63 is
 envisaged/provided, being strategic in nature.
 
 G) As reported in previous year the Company had entered into an
 agreement with Assam Tea Corporation Ltd. (ATCL) for purchase of green
 leaf of Longai and Ishabheel tea estates and operating the Longai Tea
 factory for the season 2010 to 2012 with effect from 01.03.2010. The
 company is required to pay to ATCL Re.1/- per kg. of made tea towards
 usage charges for operating the said factory. The Company has agreed to
 fund the working capital and capex requirements. Accordingly a sum of
 Rs.382.99 (previous year Rs.341.86) is recoverable from ATCL which is
 recovered on systematic basis from the proceed of green leaf procured.
 A sum of Rs.5.07 has been paid as usage charge as per agreement.
 
 H) Pursuant to the Scheme of Amalgamation and Arrangement (the Scheme)
 between M. P. Chini Industries Limited (herein after referred as
 MPCIL), Parvati Tea Company Private Limited (herein after referred as
 PTCPL) and the Company as approved by Shareholders of the respective
 companies on 8th June, 2011 and sanctioned by the Hon''ble High Court at
 Calcutta on 10th August, 2011 under the provisions of the Companies
 Act, 1956;
 
 • MPCIL has been merged with the Company w.e.f 01.10.2010 (being
 appointed date in case of MPCIL amalgamation),
 
 • The Parvati tea factory (herein after referred as factory) of PTCPL
 has been demerged from PTCPL and merged with the Company w.e.f
 01.04.2010 (being appointed date in case of PTCPL),
 
 • The strategic investment division of the Company has been demerged
 from the Company and merged with PTCPL w.e.f. 01.04.2010 (being
 appointed date in case of demerger of strategic investment division),
 
 Till the date of finalization of financial statements, the Certified
 copy of the order of Hon''ble High Court could not be obtained and thus
 not filed with the Registrar of the Companies. The accounts of the
 Company for the year have been prepared by giving the effect of the
 scheme. According to the scheme, with effect from the respective
 appointed dates, MPCIL, factory as well the demerged strategic
 investment division have carried out all their business activities in
 trust till the scheme becomes effective.
 
 The Salient Features of the scheme are as under:
 
 I.  In respect of MPCIL:
 
 (a) MPCIL is a wholly owned subsidiary of the Company and engaged in
 the business of cultivation of sugarcane and manufacture & sale of
 sugar. All the assets and liabilities of MPCIL as on the appointed date
 have been incorporated in the books of the Company at their respective
 book values on the basis of the audited accounts except the value of
 land, agriculture farms, buildings and plant & machinery which have
 been taken as Rs.11200.00 being the market value thereof and value of
 investment amounting to Rs.575.15 in few unlisted entities have been
 written off as per the scheme.
 
 (b) In terms of the Scheme, the Company shall issue 3(three) equity
 shares of Rs.5(five) each fully paid up, ranking pari passu, for 1(one)
 equity share of Rs.10(ten) each fully paid up held by the shareholders
 in MPCIL.
 
 (c) In respect of the equity shares held by the company in MPCIL, the
 shares which are required to be issued by the Company in terms of (b)
 supra shall be allotted to the Board of the Trustees of Jay Shree
 Beneficiary Trust to have and to hold such shares in trust exclusively
 for the benefit of the Company and deal with same as they deem fit.
 These shares have been recorded at original acquisition cost of shares
 of MPCIL.  The difference between the consideration and value of net
 assets acquired amounting to Rs.9443.16 has been adjusted with capital
 reserve.
 
 (d) The difference between the purchase consideration and value of net
 assets acquired of MPCIL, after carrying out necessary amendments and
 /or adjustments as per point no.(c) supra, an amount of Rs.9443.16 has
 been treated as capital reserve in terms of Accounting standard 14
 Accounting for Amalgamation being amalgamation in the nature of
 purchase.
 
 II.  In respect to Merger of Factory and demerger of Strategic
 Investment Division:
 
 (a) PTCPL is a wholly owned subsidiary of the Company and having a tea
 factory in the name of Parvati Tea Factory. PTCPL is engaged in
 business of manufacture and sales of tea w.e.f. appointed date all the
 assets and liabilities of Parvati Tea Factory have been incorporated
 in the books of the Company at their respective book values on the
 basis of the audited accounts except the value of fixed assets which
 have been taken as Rs.300.00 being the market value thereof. Further as
 on appointed date all the assets and liabilities of Strategic
 investment division of the Company has been demerged and incorporated
 in the books of the PTCPL at their respective book values as per the
 scheme.
 
 (b) In terms of the scheme, PTCPL shall issue 5,00,000 equity shares of
 10(ten) each fully paid up, ranking pari passu, to the Company in
 consideration of above.
 
 (c) The difference between the purchase consideration as given by PTCPL
 and value of net assets transferred to PTCPL, after carrying out
 necessary amendments and /or adjustments as per point no. (a) supra, an
 amount of Rs.726.25 has been treated as investment in PTCPL as
 prescribed under the scheme in terms of Accounting Standard 14
 accounting for Amalgamation being amalgamation in nature of purchase.
 
 III.  Other Conditions:
 
 (a) Shares Suspense represents 65,28,810 Equity shares of Rs.5(five)
 each fully paid to be issued in terms of point no. I (b) above which
 will rank parri passu with the existing shareholders of the Company as
 per the scheme with effective from appointed date. The shares will be
 allotted on completion of necessary formalities under the Companies Act
 and Listing agreement.
 
 (b) The income accruing and expenses incurred by MPCIL, factory and
 strategic investment division from respective appointed date to
 31.3.2011 have been properly dealt in these accounts.
 
 (c) Pursuant to the scheme, the authorized share capital of MPCIL shall
 be added to the authorized capital of the Company and the increase in
 the authorized share capital in the current year represents the same.
 
 (d) Pending completion of the relevant formalities of transfer of
 certain assets and liabilities of MPCIL & factory and strategic
 investment division pursuant to scheme, such assets and liabilities
 remain to be transferred in the name of the Company.
 
 K) i) The Company''s significant leasing agreements (as lessee) are in
 respect of lease for Land & Premises (residential, office, stores,
 godowns etc.). These Leasing arrangements which are non-cancellable
 ranging between one month and three years generally, or longer, and are
 usually renewable by mutual agreement. The aggregate lease rentals
 payable are charged as Rent under Schedule 20.
 
 ii) Certain land and building has been given on operating lease to a
 society at a lease rental of Rs.15.00 per month (previous year Rs.15.00
 per month) for the building and Rs. 0.50 (previous year Rs. 0.50) per
 annum for the land to be reviewed annually.
 
 The provisions for disputed statutory & obligatory liabilities are on
 account of cases pending with courts/concerned authorities based on
 estimates made by the Company considering the facts & circumstances.
 
 M) The Company uses forward contracts, swaps and other derivative
 contracts to hedge its risks relating to changes in exchange rates and
 interest rates. The use of such contract is consistent with the
 Company''s risk management policy. The Company does not use forward
 contracts for speculation purposes.
 
 N) Employee Benefits (Accounting Standard 15)
 
 a) Defined Contribution Plan:
 
 The Company makes contribution towards Provident Fund, ESIC and
 Superannuation Fund to a defined contribution retirement benefit plan
 for qualifying employees. The provident fund plan is operated partly by
 Regional Provident Fund Commissioner and partly by an independent
 Trust, ESIC by government agencies and Superannuation Fund by a trust
 created for the purpose. Under the said schemes the company is required
 to contribute a specific percentage of pay roll costs in respect of
 eligible employees to the retirement benefit scheme to fund the
 benefits.
 
 During the year the company has recognised Rs.707.23 for provident fund
 contribution (previous year Rs. 636.05), Rs.27.51 for ESIC (previous
 year Rs. 21.18) and Rs.55.69 for Superannuation Contribution (previous
 year Rs. 42.28). The Contribution payables to these plans by the
 Company are at the rates specified in the rules of the scheme.
 
 In keeping with the Guidance on implementing Accounting Standard (AS)
 15 on Employees Benefits issued by the Accounting Standards Board of
 the Institute of Chartered Accountants of India (ASB Guidance),
 employer-established provident fund trusts are treated as Defined
 Benefit Plans since the company is obligated to meet interest
 shortfall, if any, with respect to covered employees. According to the
 management, in consultation with Actuary, actuarial valuation cannot be
 applied to reliably measure provident fund liabilities in absence of
 guidance from Actuarial Society of India. Accordingly, the Company is
 currently not in a position to provide other related disclosures as
 required by the aforesaid AS 15 read with the ASB Guidance, however,
 having regard to the position of the fund (for covered employees) and
 confirmation from the Trustees'' of such Fund there is no shortfall as
 at the year end.
 
 b) Defined benefit plans:
 
 i) The Company makes annual contribution of gratuity to JSTI Employees
 Gratuity Fund & other private administrated Gratuity Fund schemes
 created for the purpose of qualifying employees. The scheme provides
 for a lump sum payment to vested employees upon retirement, death while
 in employment or on termination of employment of an amount equivalent
 to 15 days salary payable for each completed year of service. Vesting
 occurs upon completion of 5 years of continous service.
 
 ii) Certain employees of the Company are also eligible for encashment
 of leave upon retirement upto 30 days for each year (maximum 240 days).
 
 iii) The present value of defined benefit obligation and related
 current cost are measured using the Projected Unit Credit Method with
 actuarial valuation being carried out at each Balance Sheet date.