(A) Post-employment benefits :
 
 1.  Provident and Family Pension Fund
 
 The eligible employees of the Company are entitled to receive post
 employment benefits in respect of provident and family pension fund, in
 which both the employees and the Company make monthly contributions at
 a specified percentage of the employees eligible salary (currently 12%
 of employees eligible salary).
 
 The contributions are made to the provident fund managed by the trust
 set up by the Company or to the Regional Provident Fund Commissioner
 (RPFC) which are charged to the profit and loss account as incurred.
 
 In respect of contribution to RPFC, the Company has no further
 obligations beyond making the contribution, and hence, such employee
 benefit plan is classified as Defned Contribution Plan.
 
 In respect of contribution to the trust set up by the Company, since
 the Company is obligated to meet interest shortfall, if any, with
 respect to covered employees, such employee benefit plan is classified
 as Defned Benefit Plan in accordance with the Guidance on implementing
 Accounting Standard (AS) 15 (Revised) on Employee Benefits.
 
 2.  Superannuation
 
 The eligible employees of the Company are entitled to receive post
 employment benefits in respect of superannuation fund in which the
 Company makes annual contribution at a specified percentage of the
 employees eligible salary (currently 15% of employees eligible
 salary). The contributions are made to the Life Insurance Corporation
 of India (LIC). Superannuation is classified as Defned Contribution
 Plan as the Company has no further obligations beyond making the
 contribution. The Companys contribution to Defned Contribution Plan is
 charged to profit and loss account as incurred.
 
 3.  Gratuity
 
 The Company has an obligation towards gratuity, a defned benefit
 retirement plan covering eligible employees.  The plan provides a lump
 sum payment to vested employees at 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 or part
 thereof in excess of six months. Vesting occurs upon completion of five
 years of service. The Company has obtained insurance policies with the
 Life Insurance Corporation of India (LIC) and makes an annual
 contribution to LIC for amounts notified by LIC. The Company accounts
 for gratuity benefits payable in future based on an independent
 external actuarial valuation carried out at the end of the year.
 Actuarial gains and losses are recognised in the profit and loss
 account.
 
 (c) Other Long-Term Employee Benefits – Compensated Absences :
 
 The Company provides for encashment of leave or leave with pay subject
 to certain rules. The employees are entitled to accumulate leave
 subject to certain limits for future encashment / availment. The
 Company makes provision for compensated absences based on an
 independent actuarial valuation carried out at the end of the year.
 Actuarial gains and losses are recognised in the profit and loss
 account.
 
 (i) Research and Development
 
 Capital expenditure on Research and Development is treated in the same
 way as expenditure on fixed assets. Revenue expenditure on Research and
 Development is charged to the profit and loss account in the year in
 which it is incurred.
 
 (ii) Foreign Currency Transactions
 
 (a) Transactions in foreign currencies are recorded at the exchange
 rate that approximates the actual rate at the date of the transaction.
 In respect of monetary assets and liabilities denominated in foreign
 currencies, exchange differences arising out of settlement are
 recognised in the profit and loss account. Monetary assets and
 liabilities denominated in foreign currencies as at the balance sheet
 date are translated at the exchange rates on that date, the resultant
 exchange differences are recognised in the profit and loss account.
 
 (b) Premiums or discounts arising at the inception of the forward
 foreign exchange contracts, other than contracts to hedge a firm
 commitment or a highly probable forecast transaction, are amortised and
 recognised in the profit and loss account over the period of the
 contract. Such forward foreign exchange contract outstanding as at the
 balance sheet date are converted at the exchange rates prevailing on
 that date. Exchange differences are recognised in the profit and loss
 account.
 
 (iii) Accounting for Derivatives
 
 Forward contracts to which Accounting Standard (AS) 11 – The Effect of
 Change in Foreign Exchange Rates is applicable, the accounting policy
 as stated in Note (xii) (b) above is followed. In respect of other
 derivative contracts including forward foreign exchange contracts to
 which the aforesaid accounting standard is not applicable are marked to
 market at the rate on the balance sheet date. The resultant exchange
 differences are recognised in the profit and loss account.
 
 (iv) Taxation
 
 Tax expense comprises current and deferred tax. Current tax is measured
 at the amount expected to be paid to the tax authorities in accordance
 with the Income-tax Act, 1961. Deferred tax refects the impact of
 current year timing differences between taxable income and accounting
 income for the year and reversal of timing differences of earlier
 years. Deferred tax is measured based on the tax rate and tax laws
 enacted or substantially enacted as at the balance sheet date. Deferred
 tax assets are recognised only to the extent that there is reasonable
 certainty that sufficient future taxable income will be available
 against which such deferred tax assets can be realised in future;
 however, where there is unabsorbed depreciation or carry forward of
 losses, deferred tax assets are recognised only if there is virtual
 certainty of realisation of such assets. Deferred tax assets are
 reviewed as at each balance sheet date and written down or written up
 to refect the amount that is reasonably / virtually certain (as the
 case may be) to be realised.
 
 (v) Provisions and Contingent Liabilities
 
 (a) A provision is recognised when an enterprise has a present
 obligation as a result of past event and it is probable that an outflow
 of resources will be required to settle the obligation, in respect of
 which a reliable estimate can be made. Provisions are not discounted to
 their present values and are determined based on management estimate
 required to settle the obligation at the balance sheet date. These are
 reviewed at each balance sheet date and adjusted to refect the current
 management estimates.
 
 (b) Contingent liabilities are disclosed in respect of possible
 obligations that have arisen from past events and the existence of
 which will be confirmed only by the occurance or non-occurance of
 future events not wholly within the control of the Company.
 
 (c) When there is an obligation in respect of which the likelyhood of
 outfow of resources is remote, no provision or disclosure is made.
 
 (v) Leases
 
 Leases where the lessor effectively retains substantially all the risks
 and benefits of ownership of the leased assets are classified as
 operating leases. Operating lease payments / receipts are recognised as
 an expense / income in the profit and loss account on a straight-line
 basis over the lease term.
 
 3. The Company has made monthly payments aggregating Rs. 9.40 lacs
 (2009-2010 Rs. 9.40 lacs) towards post retirement arrangements to
 former wholetime directors.
 
 * used for processing goods on behalf of Nipa Chemicals Limited, an
 erstwhile associate company.
 
 (a) Figures in brackets are in respect of the previous year.
 
 (b) Installed capacity has been certified by the Works Manager and
 accepted by the Auditors without verification, being a technical
 matter.
 
 (c) Production does not include goods processed outside. Sales, opening
 stock and closing stock include goods processed and purchased from
 outside. The closing stock is after adjustments for obsolescence and
 shortages. Closing stock figures, if derived from opening stock plus
 production / purchases and less sales would therefore be different.
 
 4.  As the Companys business activity falls within a single business
 segment viz. Paints and the sales substantially being in the domestic
 market, the financial statements are refective of the information
 required by Accounting Standard 1 Segment Reporting, notifed under
 the Companies (Accounting Standards) Rules, 2006.
 
 5.  Related party disclosures
 
 (i) (a) Names of related parties and nature of related party
 relationship where control exists are as under:
 
 Holding Company             : Kansai Paint Co., Ltd., Japan
 
 (b) Names of other related parties and nature of relationship where
 there are transactions with related parties
 
 Fellow Subsidiary Companies : Kansai Paint Philippines Inc
 
                               Kansai Resin (Thailand) Co. Ltd.
 
                               Kansai Coatings Malaysia SDN. BHD.
 
                               Sime Kansai Paints SDN. BHD.
 
 Associate – company in 
 which the Company           : Nipa Chemicals Limited
 has substantial interest
 (i.e. more than 20% in
  voting power)
 (Upto 14th January, 2011)
 
 Key management personnel    : Mr. H. M. Bharuka, Managing Director
 
                               Mr. P. D. Chaudhari, Wholetime Director
 
 6.  The Company has given on lease, colour dispenser to its dealers.
 The particulars in respect of such leases are as follows: (a) (i) The
 gross carrying amount and the accumulated depreciation at the balance
 sheet date are Rs. 13644.98 lacs (2009-2010 Rs. 12137.52 lacs) and Rs.
 11246.37 lacs (2009-2010 Rs. 10030.75 lacs) respectively.
 
 (c) The lease agreements are generally for a period of three years.
 However, the corresponding lease rentals may be receivable for a
 shorter period or may be waived off.
 
 7.  (a) Provision for indirect taxes:
 
 With restructuring of the production facilities, the timing of the
 outflow of provision Rs. 2553.57 lacs (2009-2010 Rs. 2663.58 lacs)
 recognised in respect of matters relating to indirect taxes is
 dependent on the outcome of the settlement with the appropriate
 authorities.
 
 (b) Provision for warranty:
 
 The Company is selling certain products with a warranty of four to
 seven years. Accordingly, provision has been recognised on the basis of
 managements expectation of warranty claims on such products.
 
 B.  Defned Benefit Plan
 
 (a) Contribution to provident fund managed by the trust set up by the
 Company:
 
 According to the management, the actuary has opined that actuarial
 valuation cannot be applied to reliably measure provident fund
 liabilities in respect of fund managed by the trust set up by the
 Company in the absence of guidance from the Actuarial Society of India.
 Accordingly, the Company is currently not in a position to provide
 other related disclosures as required by Accounting Standard (AS) 15
 (Revised) on Employee Benefits notified by the Companies (Accounting
 Standards) Rules, 2006 read with the Guidance issued by the Accounting
 Standards Board of the Institute of Chartered Accountants of India.
 Having regards to the assets of the fund and the return on investments,
 the entity does not expect any significant deficiency in the
 foreseeable future. Accordingly, no provision is required towards the
 guarantee given for notified interest rates. During the year, the
 Company has contributed Rs. 115.18 lacs (2009-2010: Rs. 103.89 lacs) to
 the Provident Fund Trust.
 
 vi. (a) The estimates of rate of escalation in salary considered in
 actuarial valuation take into account inflation, seniority, promotion
 and other relevant factors including supply and demand in the
 employment market.
 
 (b) The discounting rate is considered based on market yield on
 government bonds having currency and terms consistent with the currency
 and terms of the post-employment benefit obligations.
 
 (c) Expected rate of return on assets is determined based on
 expectation of the average long term rate of return expected on
 investments of the fund during the estimated term of the obligations.
 
 vii.  The above information is certified by the actuary.
 
 viii.  Net assets / (liabilities) recognised in the balance sheet as at
 respective year ends and experience adjustments:
 
 (c) Compensated Absences
 
 The increase in provision for compensated absences for the year is Rs.
 33.05 lacs (2009-2010 Rs. 115.98 lacs).
 
 8.  Derivatives Instruments: (contd.)
 
 B.  The year-end foreign currency exposures that have not been hedged
 by a derivative instrument or otherwise are given below:
 
 (a) Amounts payable in foreign currency CHF 1.06 lac [2009-2010 – CHF
                                         0.04 lac]
 
                                        Euro 0.28 lac [2009-2010 – Euro     
                                        0.68 lac] 
 
                                        GBP 0.10 lac [2009-2010 – GBP
                                        0.79 lac] 
 
                                        JPY 813.19 lacs [2009-2010 –  
                                        JPY 423.45 lacs] 
 
                                        SGD 0.09 lac [2009-2010 – SGD 
                                        Nil] 
 
                                        USD 44.93 lacs [2009-2010 – 
                                        USD 43.45 lacs]
 
 (b) Advance payment in foreign 
 currency for supplies                  CHF 1.85 lac [2009-2010 – CHF 
                                        0.68 lac]
 
                                        Euro 0.99 lac [2009-2010 – 
                                        Euro 0.50 lac]
 
                                        GBP Nil [2009-2010 – 
                                        GBP 0.11 lac]
 
                                        JPY 295.81 lacs [2009-2010 – 
                                        JPY 146.82 lacs]
 
                                        SGD 0.18 lac [2009-2010 – 
                                        SGD Nil]
  
                                        USD 11.66 lacs [2009-2010 – 
                                        USD 3.04 lacs]
 
 9.  The Company has divested its entire stake in its erstwhile
 associate company, Nipa Chemicals Limited, for a consideration of Rs.
 2572.51 lacs.
 
 10.  Prior years figures have been regrouped and rearranged wherever
 necessary to confirm to current years classification.