1.1 Shares held by holding or ultimate holding company or its
subsidiaries or associates 1,255,354,097 Equity Shares (1,255,354,097
Equity Shares) are held by ONGC Limited, the holding company.
1.2 No shares are reserved for issue under options and
contracts/commitments for the sale of shares/disinvestment
a. Includes Rs. 261.50 Million (Previous YearRs. 260.87 Million) which has
not been amortised in view of the fact that eventually the ownership
will get transferred to the Company on expiry of the lease period, of which
Rs.11.52 Million (Previous YearRs. 11.52 Million) is in the process
Being surrendered to Competent Authority. Net Block Rs.11.52 Million
(Previous YearRs. 11.52 Million).
b. Includes land value Rs. 29.99 Million (Previous YearRs. 29.99 Million),
which is in possession of the company towards which formal lease deeds
are yet to be executed . Net BlockRs.29.92 Million (Previous Year
c. Includes Rs. 782.98 Million (Previous Year Rs. 782.98 Million) being
Company''s share of an asset jointly owned with another Company. Net
Block Rs. 120.73 Million (Previous YearRs. 162.07 Million).
d. Includes Office Equipments
e. Assets not in use and held for sale is shown at lower of cost or
estimated realisable value.
f. Represents consideration for purchase of business (Nitrogen Plant)
in excess of book value of net assets acquired.
2.01 Effects of changes in Foreign Exchange Rates (AS11)
Pursuant to Notification no. G.S.R.(914)E dated 29th December 2011,
issued by MCA, from the current financial year, the Company has opted
to adjust exchange differences arising on reporting of long term
foreign currency monetary items, in so far as they relate to the
acquisition of depreciable assets, against the cost of such assets and
depreciate the said adjustment over the balance life of the asset. Had
the option not been exercised, the difference amounting to Rs. 26.14
million on long term foreign currency monetary items relating to
depreciable assets would have been charged to Profit and Loss Account
and Capital Work in Progress would have been lesser to that extent.
2.02 Employee Benefits(AS-15)
2.02.01 Brief Description: A general description on the type of
Defined Benefit Plans are as follows: a Earned Leave Benefit (EL):
Accrual 32 days per year Accumulation up to 300 days allowed
EL accumulated in excess of 15 days is allowed for encashment while in
service provided the EL encashed is not less than 5 days. b Sick Leave
Accrual —10 days per year Encashment while in service is not allowed
Encashment on retirement is permitted and entire accumulation is
allowed for encashment c Gratuity:
15 days salary for every completed year of service. Vesting period is 5
years and the payment is restricted to Rs. 1 miilion.
d Long Service Emblem:
On completion of each milestone of service from the date of joining and
also at the time of retirement, employees will be gifted with Gold
Coin, weight depends on the milestone of service completed.
e Post Retirement Medical Benefits:
After retirement, on payment of one time lump sum contribution, the
Superannuated employee and his/her dependent spouse and dependent
parents will be covered for medical benefit as per the rules of the
f Retirement Benefits:
At the time of superannuation, employees are entitled for reimbursement
of expenses towards travel, transportation of personal effects from
their place of retirement to the new location upto certain limits
depending on the designation of the employee at the time of retirement
and one month''s salary as settling allowance.
2.03 Borrowing Costs(AS-16)
Amount of borrowing costs capitalised during the yearRs. 889.56 million
(Previous year Nil)
2.04 Segment Reporting(AS17)
The Company is engaged in the business of refining crude oil, all
activities of the Company revolve around this business and the
operations are in India. As such there is no other reportable segment
as defined by the Accounting Standard 17 - Segment Reporting issued
under The Companies (Accounting Standards ) Rules, 2006. The
clarification sought for by the Company on the EAC opinion is under
consideration by ICAI and hence segment reporting is not made.
2.05 Related Party Disclosure (AS-18)
2.05.01 The Company is a state controlled enterprise and the
transactions with other state controlled enterprises are not required
to be disclosed as perAS-18.
2.05.02 Key Management Personnel:
(i) Shri. U.K.Basu, Managing Director
(ii) Shri P.P.Upadhya, Director (Technical)
(iii) Shri Vishnu Agrawal, Director (Finance)
2.06.01 The company has taken various premises under cancellable
2.06.02 These lease agreements are normally renewed on expiry of the
2.06.03 Lease rental expenses for the year ended 31st March, 2012 in
respect of above operating leases are Rs. 34.75 Million (pre. year
Rs. 44.22 Million)
2.07 Accounting for taxes on income(AS-22)
2.07.01 The company has commenced commercial refining of crude oil
from its Phase III refinery during the year and accordingly is entitled
to the deduction u/s80 IB of the Income TaxAct,1961.
2.07.02 Contingent Liabilities not provided for in respect of:
a Corporate Guarantee given by the Company towards loan of Rs. 3,372.30
Million sanctioned by certain bankers / financial institutions to New
Mangalore Port Trust (NMPT) for construction of Jetties. Amount
outstanding as at the close of the year ended 31st March, 2012, after
adjusting the repayment made by NMPT is Rs. Nil (Previous Year Rs.Nil).
In respect of all these claims, which are being contested by the
company as not admissible, it is not practicable to make a realistic
estimate of the outflow of resource, if any, for settlement of such
claim pending resolution / award from Arbitrators / Court.
2.07.03 Disputed tax / Duty demands pending in appeal:
a) Income Tax: Rs. 1123.40 Million (Previous YearRs. 373.90 Million).
(against this Rs. 1000.92 Million is adjusted / paid under protest and is
included under loans & advances. Note 21)
b) Commercial Tax: Rs. 321.49 Million (Previous Year Rs. 1217.84 Million)
Rs. includes Rs. 321.49 Million (Previous Year Rs. 524.87 Million) relating
c) Excise Duty: Rs. 488.10 Million (Previous Year Rs. 360.26 Million).
(against this Rs. 27.01 Million is paid under protest and is included
under loans & advances Note -20)
d) Customs Duty:Rs.647.54 Million (previous yearRs. 130.19 Million).
2.07.04 a) The estimated amount of contracts remaining to be executed
on capital account and not provided for (net of advances) Rs.31,185.31
Million (Previous YearRs. 57,527.76 Million).
b) Other commitments
i) ECB Loan to be availed USD 200 million
ii)ONGC Loan to be availed Rs. 24000 million
iii)Pending commitment on account of Refinery performance improvement
programme by M\s.Shell Global International Solution
(M\s.Shell GIS) USD 0.50 Million USD
2.8 Foreign Exchange exposures
2.9 Loans and Advances :
Loans and advances (Note 20) include refund claims for Custom Duty on
project imports Rs. 378.71.Million (Previous yearRs. 378.71Million) and
Commercial Taxes Rs. 548.48 Million (previous year Rs. 476.34 Million). A
further refund due towards Commercial Taxes Rs. 2,884.43 Million is also
included therein for which there is a matching liability to pay to
customers on receipt of the refund which is included under other
current liabilities - liability for statutory payments( Note 10).
2.10.01 The Sales tax deferment loan shown under Unsecured Loans
(Note-4 ) includes a sum of Rs. 290.17 Million (Previous YearRs. 290.17
Million) relating to CST on excise duty included under refund from
Commercial Tax Department ( Note 20) for the years 2000-01and 2001-02,
which were earlier paid under protest and are now being claimed as
sales tax deferment loan by the Company.
2.11 The Company is yet to receive response for its confirmation
letters from some of the trade receivables , Loans and Advances and
trade payables. Reconciliation and adjustment will be effected on
receipt of confirmations, which in the opinion of the management will
not be significant.
2.12 Following expenses are included under other heads of expenses
Insurance charges amounting to Rs. 20.22 Million (Previous year Rs.17.13
Million) relating to crude purchase and staff welfare has been charged
under respective heads.
2.13 Dues to Micro, Small & Medium enterprises:
The classification of the suppliers under Micro, Small and Medium
Enterprises Development Act, 2006 is made on the basis of information
made available to the company. The Company has neither paid any
interest in the terms Section 16 of the above said Act nor any interest
remain unpaid and no payments were made beyond the ''appointed date''
to such enterprises during the year ended 31.03.2012. Amount
outstanding to these enterprises for the year ended 31st March, 2012 is
Rs.Nil (Previous year: Rs.Nil)
2.14 The financial statements for the year ended March, 31,2011 had
been prepared as per the then applicable , pre Revised Schedule VI to
the Companies Act,1956 . Consequent to the notification of Revised
Schedule VI under the Companies Act,1956, the financial statements for
the year ended March,31,2012 are prepared as per Revised Schedule VI.
Accordingly, the previous year''s figures have also been reclassified to
conform to this year''s classification. The adoption of Revised Schedule
VI for previous year''s figures does not impact recognition and
measurement principles followed for preparation of financial statements.
Corporate Governance is based on principles of conducting business with
all integrity and fairness, being transparent with regard to all
transactions making all disclosures, complying with laws of land,
accountability and responsibility towards the shareholders and
commitment to conduct the business in an ethical manner.
We at MRPL are committed to good governance practices that create
long-term sustainable value for its stakeholders. Our Corporate
Governance framework is based on the following principles:
- Ensuring maximum disclosure of information to the Board/Committees
of the Board for meaningful and focused discussions in meetings;
- Committed to a transparent system and values;
- Operating in a sound system of internal control with a thrust on
integrity and accountability;
- Ensuring timely and adequate disclosure of all material information
to all Stakeholders;
- Ensuring compliance of applicable laws, guidelines, rules and
- Committed for equitable and fair treatment to all its stakeholders
and society at large.