1. Contingent Liabilities not provided for in respect of:
(Rs. in Crores)
Description Current Year Previous Year
a) Guarantees issued by the Company''s
Bankers on behalf of the Company 351.11 323.39
b) Letter of credit opened by banks 1,453.12 1,234.89
c) Corporate guarantees/undertakings
issued on behalf of third parties. 3,359.50 1,825.95
d) Disputed excise duty and
other demands 684.77 632.30
e) Future liability on account of
lease rent for unexpired period. - 8.85
f) Bonds executed for machinery
imports under EPCG Scheme 3,039.99 2,529.15
g) Income Tax demands where the cases
are pending at various stages of 187.21 111.03
appeal with the authorities
2. Estimated amount of contracts remaining to be executed on capital
account and not provided for (net of advances): Rs. 3,763.48 crores
(Previous year Rs. 6,163.80 crores).
3. one of the Company''s expansion units at Raigarh (Chhattisgarh) is
eligible for sales tax exemption owing to its investment in capital
assets under the State industrial policy which aims towards the
objective of industrialisation of the State and development of backward
areas. The period of exemption is linked to the quantum of investment.
The Company has been advised that the element of sales tax included in
the sales price of products sold out of this Unit is in the nature of
sales tax subsidy granted by the State Government. Accordingly, the
same amounting to Rs. 32.23 crores (Previous year Rs. 33.33 crores) has
been credited during the year to Sales Tax Subsidy Reserve Account. The
cumulative amount credited to Sales tax Subsidy Reserve Account up to
31st march, 2011 is Rs.197.19 crores (Previous year Rs. 164.96 crores).
4. in accordance with Accounting Standard (AS-29) ''Provisions,
Contingent Liabilities and Contingent Assets'' and based on management
assessment, the Company had made a provision for contingencies on
account of duties and taxes payable under various laws. At the
beginning of the financial year, there was an outstanding provision of
Rs. 156.02 crores (Previous year Rs. 156.02 crores) included in ''other
outstanding Liabilities''. No provision/utilisation was made either in
the current year or in the previous year. At the end of the financial
year, there is an outstanding provision of Rs. 156.02 crores (Previous
year Rs.156.02 crores).
5. the employees Stock option Scheme - 2005 (eSoS- 2005) was approved
by the shareholders of the Company in their Annual General meeting held
on 25th July, 2005 and amended by shareholders on 27th September, 2006.
under eSoS-2005, a maximum of 11,00,000 (Eleven lacs) equity shares of
Rs. 5 each could be granted to the employees of the Company and its
subsidiary company(ies). in-principle approval from National Stock
exchange of india Limited and Bombay Stock exchange Limited was given
on 01.02.2006. A Compensation Committee was constituted by the Board of
directors of the Company in their meeting held on 12th may, 2005 for
the administration of eSoS-2005. under eSoS-2005, the Compensation
Committee has granted stock options as follows:
a) 8,59,400 (eight lacs ffty nine thousand four hundred) stock options
on 26.11.2005 at an exercise price of Rs. 1,014 per share (Series I)
which would vest after 2 years from the date of grant to the extent of
50% (Part 1), after 3 years from the date of grant to the extent of 25%
(Part 2) and after 4 years from the date of grant to the extent of 25%
(Part 3);
b) 1,29,550 (one lac twenty nine thousand five hundred fifty) stock
options on 02.09.2006 at an exercise price of Rs. 1,121 per share
(Series II) which would vest after 2 years from the date of grant to
the extent of 50% (Part 1), after 3 years from the date of grant to the
extent of 25% (Part 2) and after 4 years from the date of grant to the
extent of 25% (Part 3); and
c) 1,36,950 (one lac thirty six thousand nine hundred fifty) stock
options on 27.04.2007 at an exercise price of Rs.1,819 per share
(Series III) which would vest after 2 years from the date of grant to
the extent of 50% (Part 1), after 3 years from the date of grant to the
extent of 25% (Part 2) and after 4 years from the date of grant to the
extent of 25% (Part 3).
Pursuant to Clause 5.3 (f) of SEBI (Employees Stock option Scheme and
employees Stock Purchase Scheme) Guidelines, 1999 and Para 18 of the
eSoS- 2005 of the Company, the Compensation Committee is authorised to
make a fair and reasonable adjustment to the number of options and to
the exercise price in respect of options granted to the employees under
the Scheme in case of corporate actions such as right issue, bonus
issue, merger etc. on 27.12.2007, sub-division of the face value of
each equity share of the Company from Rs. 5 to 5 equity shares of Re. 1
each was approved by the shareholders in their General meeting.
thereafter, the Compensation Committee has, in its meeting held on
27.01.2008, made an adjustment to the exercise price by reducing it in
case of Series I to Rs. 203 Series II to Rs. 225 and Series III to Rs.
364 per equity share of Re. 1 each and to the number of options by
increasing it 5 times the original grant consequent to which the number
of maximum options that could be issued under the eSoS-2005 increased
to 55,00,000 (Fifty five lacs) [originally 11,00,000 (Eleven lacs)]
Thereafter, the following allotments of equity shares were made under
eSoS-2005 on the exercise of options:
a) 6,91,343 (Six lacs ninety one thousand three hundred forty three)
equity shares of Re. 1 each were allotted on 16th June, 2008 on
exercise of options granted under Part 1 of Series I of eSoS-2005;
b) 57,136 (Fifty seven thousand one hundred thirty six) equity shares
of Re. 1 each were allotted on 13th April, 2009 on exercise of options
granted under Part 1 of Series ii of eSoS-2005;
c) 4,20,487 (Four lacs twenty thousand four hundred eighty seven)
equity shares of Re. 1 each were allotted on 21st July, 2009 on
exercise of options granted under Part 2 of Series i of eSoS-2005.
The remaining 43,31,034 (Forty three lacs thirty one thousand thirty
four) equity shares of Re. 1 each were available for allotment under
eSoS-2005 after the above 3 allotments.
On 4th September, 2009, issue of 5 equity shares of Re. 1 each as bonus
shares on each existing equity share of the Company was approved by the
shareholders in their General meeting and on 19th September, 2009,
fully paid-up bonus shares were allotted.
Thereafter, pursuant to clause 5.3 (f) of SEBI (employees Stock option
Scheme and employees Stock Purchase Scheme) Guidelines, 1999 and Para
18 of the eSoS-2005 of the Company, the Compensation Committee has, in
its meeting held on 31st october, 2009 made the following adjustments:-
a) The number of unexercised options and options yet to be granted is
increased by 5 times consequently increasing the number of unexercised
and options yet to be granted from 43,31,034 (Forty three lacs thirty
one thousand thirty four) to 2,59,86,204 (two Crores fifty nine lacs
eighty six thousand two hundred four);
b) The price of unexercised options was reduced in case of Series I to
Rs. 34, Series II to Rs. 38 and Series III to Rs. 61 per equity share
of Re. 1 each.
In-principle approval for listing of additional 2,16,55,170 (two Crores
sixteen lacs fifty five thousand one hundred seventy) equity shares were
obtained from National Stock exchange of india Limited and Bombay Stock
exchange Limited.
Thereafter, the following allotments of equity shares were made under
eSoS-2005 on exercise of options:-
a) 4,52,246 (Four lacs fifty two thousand two hundred forty six) equity
shares of Re. 1 each were allotted on 30th January, 2010 on exercise of
options granted under Part 1 of Series III of eSoS-2005;
b) 2,52,006 (two lacs fifty two thousand six) equity shares of Re. 1
each were allotted on 13th April, 2010 on exercise of options granted
under Part 2 of Series ii of eSoS-2005;
c) 24,56,922 (twenty four lacs fifty Six thousand nine hundred twenty
two) equity shares of Re. 1 each were allotted on 23rd June, 2010 on
exercise of options granted under Part 3 of Series I of eSoS-2005;
6. a) Provision for current income tax has been made considering
various benefits and allowances available to the Company under the
provisions of the Income Tax Act, 1961.
7. Additions/(Adjustments) to Plant and machinery/Capital
work-in-progress includes addition of Rs. 165.92 crores [Previous year
adjustment of Rs. (149.87) crores] on account of foreign exchange
fluctuation on long-term liabilities relating to acquisition of Fixed
Assets pursuant to the Notification issued by the ministry of Corporate
Affairs relating to Accounting Standard (AS-11) ''the effects of Changes
in Foreign exchange Rates''.
8. Sales/Adjustments in gross block and depreciation under Schedule 5
includes the assets taken out of active use during the financial year of
Rs. Nil and Rs. Nil (Previous year Rs. 19.80 crores and Rs. 1.89
crores) respectively. these items of fixed assets are included in the
inventory of stores & spares at estimated realisable value.
9. expenditure on Research & development Activities, incurred during
the year, is Rs. 12.25 crores (including capital expenditure of Rs.
6.45 crores) (Previous year Rs. 3.71 crores, including capital
expenditure of Rs. 0.50 crores).
10. The Company has unquoted investments of Rs. 1,219.25 crores in
body corporates (Previous year Rs. 1,075.78 crores). The management
had made a provision for diminution in the value of investments of Rs.
11.54 crores during the earlier years. Based on the financial position
of the investee companies, the management is of the view that the
provision created is adequate.
11. in the opinion of the Board, Current Assets, Loans and Advances
have a value on realisation in the ordinary course of business at least
equal to the amount at which they are stated and provision for all
known liabilities has been made.
12. Advances recoverable in cash or in kind or for value to be
received includes Rs. 0.18 crores (Previous year Rs. 0.16 crores) being
the amount due from directors/officers of the Company. maximum amount
outstanding at anytime during the year was Rs. 0.45 crores (Previous
year Rs. 0.48 crores).
13. the Company has so far not received information from vendors
regarding their status under the micro, Small and medium enterprises
development Act, 2006 and hence disclosure relating to amounts unpaid
as at the year-end together with interest paid/payable under this Act
has not been given.
14. The Company has paid lease rentals of Rs. 7.87 crores (Previous
year Rs. 6.84 crores) under cancellable operating leases. there are no
non-cancellable operating leases.
15. donations include Rs. Nil (Previous year Rs. 0.50 crores) to
Haryana Pradesh Congress Committee, being a political party.
16. Borrowing cost incurred during the year and capitalised by the
Company is Rs. 71.02 crores (Previous year Rs. 0.28 crores). Borrowing
Cost incurred during the year and transferred to Capital Work in
Progress by the Company is Rs. 202.69 crores (Previous year Rs. 108.81
crores).
17. in the previous year, dividend proposed relating to the shares
under eSoP was made on the basis of options vested but not exercised
till the end of the financial year. Provision made in respect of options
lapsed and not exercised in the current year has been adjusted with the
dividend proposed for the year ended on 31st march, 2011.
18. The Company has made a provision of Rs. 3.75 crores (Previous year
Rs. 4.28 crores) net of reversal of Rs. 0.02 crores (Previous year Rs.
Nil) for Corporate dividend tax on the amount of dividend proposed for
the year ended 31st march, 2011 after considering the set-off of
interim dividend declared by a subsidiary company for the same financial
year, as per the provisions of section 115-o of the income tax Act,
1961.
19. disclosures as required by Accounting Standard (AS-17) ''Segment
Reporting'':
The primary reportable segments are the business segments namely iron &
Steel and Power. the secondary reportable segments are geographical
segments which are based on the sales to customers located in India and
outside India.
Segment accounting policies are in line with the accounting policies of
the Company. in addition, the following specific accounting policies
have been followed for segment reporting:
a) Segment revenue includes sales and other income directly identifiable
with/allocable to the segment including inter-segment revenue.
b) expenses that are directly identifiable with/allocable to segments
are considered for determining the segment results.
c) Expenses/Incomes which relates to the Company as a whole and not
allocable to segments are included under other un-allocable expenditure
(net of un-allocable income).
d) Segment assets and liabilities include those directly identifiable
with respective segments. un-allocable assets and liabilities represent
the assets and liabilities that relate to Company as a whole and not
allocable to any segment.
20. disclosure as required by Accounting Standard (AS-18) ''Related
Party disclosures'':
The names of related parties where control exist and/or with whom
transactions have taken place during the year and description of
relationship as identified and certifed by the management are:
A. List of Related Parties and Relationships
a) Subsidiaries & Step-down Subsidiaries
I. Subsidiaries
1. Jindal minerals & metals Africa Limited
2. Jindal Power Limited
3. Jindal Steel & Power (mauritius) Limited
4. Jindal Steel Bolivia SA
ii. Subsidiaries of Jindal Power Limited
1. Attunli Hydro electric Power Company Limited
2. etalin Hydro electric Power Company Limited
3. Jindal Hydro Power Limited
4. Jindal Power distribution Limited
5. Jindal Power trading Company Limited (formerly Chhattisgarh energy
trading Company Limited)
6. Jindal Power transmission Limited
7. Subansiri Hydro electric Power Company Limited
iii. Subsidiaries of Jindal minerals & metals Africa Limited
1. Jindal minerals and metals Africa Congo SPRL
iv. Subsidiaries of Jindal Steel & Power (mauritius) Limited
1. Affiliate overseas Limited
2. enduring overseas Limited
3. Harmony overseas Limited
4. Jindal Africa investments (Pty) Limited
5. Jindal Brasil mineracao SA
6. Jindal dRCSPRL
7. Jindal Investments LdA
8. Jindal investment Holdings Limited
9. Jindal madagascar SARL
10. Jindal minerals mining Limited (till 03.11.2010)
11. Jindal mining & exploration Limited
12. Jindal mining industry LLC
13. Jindal Power LLC
14. Jindal Steel & Power (Australia) Pty Limited (w.e.f. 15.06.2010)
15. Jindal Steel & Power Zimbabwe Limited (w.e.f. 06.05.2010)
16. JSPL mozambique Minerals LdA
17. Jubilant overseas Limited
18. osho madagascar SARL
19. Pt Jindal overseas
20. Rolling Hills Resources LLC
21. Shadeed iron & Steel Co. LLC (w.e.f. 29.06.2010)
22. Skyhigh overseas Limited
23. trans Atlantic trading Limited
24. Vision overseas Limited
25. worth overseas Limited V. others
1. Belde empreendimentos mineiros Limited, a subsidiary of JSPL
mozambique Minerals LdA
2. eastern Solid Fuels (Pty) Limited, a subsidiary of Jindal mining &
exploration Limited
3. Gas to Liquids international SA, a subsidiary of worth overseas
Limited
4. Jindal mining (Pty) Limited, a subsidiary of eastern Solid Fuels
(Pty) Limited
5. Kasai Sud diamant, a subsidiary of Jindal dRC SPRL
b) Associates
1. Angul Sukinda Railway Limited
2. Nalwa Steel & Power Limited
3. Saras mineracao de Ferro S.A. (Associate of Jindal Steel & Power
mauritius Limited) (till 02.06.2010)
4. Jindal infosolutions Private Limited (w.e.f. 30.03.2011)
c) Joint Ventures
1. Jindal Synfuels Limited (formerly Jindal Coal to Liquid Limited)
2. Shresht mining and metals Private Limited
3. urtan North mining Private Limited
d) Key Management Personnel
1. Shri Naveen Jindal (exec. Vice Chairman & managing director)
2. Shri Vikrant Gujral (Group Vice Chairman & Head Global Ventures)
3. Shri Anand Goel (Jt. managing director, Corporate Affairs)
4. Shri Arun K. mukherji (whole time director upto 23.11.2010)
5. Shri Naushad Akhter Ansari (whole time director from 01.12.2010)
e) Enterprises over which Key Management Personnel and their relatives
exercise significant infuence and with whom transactions have taken
place during the year
1. Advance Sporting Arms Private Limited
2. Bir Plantation Private Limited
3. Gagan infraenergy Limited (formerly Gagan Sponge iron Limited)
4. india Flysafe Aviation Limited
5. Jindal Coal Private Limited
6. Jindal Realty Private Limited
7. Jindal Rex exploration Private Limited
8. Jindal Saw Limited
9. Jindal Stainless Limited
10. Jindal System Private Limited
11. minerals management Services (india) Private Limited (formerly
minerals management Services (india) Limited)
12. Nalwa Sons investment Limited
13. opelina Finance and investment Limited
14. trishakti Real estate infrastructure and developers (P) Limited
15. uttam Vidyut transmission Private Limited
16. YNo Finvest Private Limited
21. Financial and derivative instruments:
a) Derivatives contracts entered into by the Company and outstanding as
on 31st march, 2011, for hedging currency and interest rate related
risks:
c) In accordance with the accounting policy on financial derivative
instruments, during the year, the company has recognised mark to market
losses of Rs. 21.62 crores (Previous year Rs. Nil being market to
market gains).
22. Previous year figures have been regrouped and/or rearranged
wherever considered necessary to facilitate comparison with current
year figures. |