1.  (a) Contingent Liabilities :
 
 (i) In respect of Income Tax demands for which the Company has
 preferred appeals with appropriate authorities - Rs.37 25 30 147
 (Previous year : Rs.25 80 42 721). The liability is mainly on account of
 various disallowances by the Income Tax authorities on which assessee
 has preferred an appeal. These are on account of various grounds -
 primarily on account of advertisement expenses, tax holiday, etc.
 
 (ii) In respect of Sales tax matters for which the Company has
 preferred appeals with appropriate authorities - Rs.18 18 02 208
 (Previous year : Rs.10 06 72 419). The liability is in respect to matters
 related to: non-submission of C Forms/F Forms Rs.6 37 05 567
 (Previous year : Rs.1 25 577), Incomplete accounts books Rs. 1 79 53 096
 (Previous year : Rs. 1 05 62 077), Classification issues Rs.56 89 172
 (Previous year : Rs.76 07 120), Product valuation issues Rs.8 96 70 537
 (Previous year : Rs.8 19 74 831), and other miscellaneous issues Rs.47 83
 836 (Previous year : Rs.4 02 814).
 
 (iii) In respect of Excise, Customs and Service Tax matters for which
 the Company has preferred appeals with appropriate authorities Rs.3 09 55
 483 (Previous year : Rs.5 77 55 812). The liability is in respect to:
 classification matters Rs.8 74 000 (Previous year : Rs.23 50 490),
 valuation matters Rs.97 40 805 (Previous year : Rs.3 80 06 429),
 applicability of service tax on testing charges Rs. 1 64 678 (Previous
 year : Rs.1 64 678) and others Rs.2 34 215 (Previous year : Rs.2 34 215).
 Contingent liability for customs duty is towards the old advance
 licence matters which are under dispute.
 
 (iv) In respect of counter guarantees given to bank against guarantees
 given by bank : Rs.20 80 05 094 (Previous year : Rs. 11 28 94 773). At the
 request of the Company, its bankers have issued guarantees to third
 parties for performance obligation under various commercial agreements.
 The Company has issued counter guarantees to the banks in respect of
 these guarantees.
 
 (v) In respect of other claims - Rs.5 00 000 (Previous year : Rs.22 22
 829). The Company is a party to various legal proceedings in the normal
 course of business. The Company does not expect the outcome of these
 proceedings to have a material adverse effect on the Companys
 financial conditions, results of operations or cash flows.
 
 (vi) Custom duty liability for probable non fulfillment of export
 obligation Rs. 1 95 50 000 (Previous year : Nil).
 
 (b) Estimated amount of contracts remaining to be executed on capital
 account (net of advances) - Rs.3 31 51 397 (Previous year : Rs.13 18 83
 576).
 
 2.  The Company has classified the various benefits provided to
 employees as under:
 
 I.  Defined Contribution Plans
 
 a.  Provident Fund (Previous Year from April 01, 2009)
 
 b.  Superannuation Fund
 
 c.  State Defined Contribution Plans: Employers Contribution to
 Employees State Insurance
 
 II.  Denned Benefit Plans
 
 a.  Gratuity Fund (Funded Scheme): Gratuity is payable to all eligible
 employees of the Company on superannuation, death, permanent
 disablement and resignation in terms of the provisions of the Payment
 of Gratuity Act, 1972 or Companys scheme whichever is more beneficial.
 Benefits would be paid at the time of separation based on the last
 drawn base salary.
 
 b.  Provident Fund (Funded Scheme): With effect from January 1, 2008
 till March 31, 2009 the Company had managed Provident Fund plan through
 Companys own Provident Fund trust alongwith one other group Company
 for its employees. The plan envisaged contribution by employer and
 employees and guarantees interest at the rate notified by the Provident
 Fund authority. The contribution by employer and employee together with
 interest are payable at the time of separation from service or
 retirement whichever is earlier. The benefit under this plan vests
 immediately on rendering of service. The Entity had re-commenced
 contribution of Provident Fund dues with Regional Provident Fund
 Commissioner (RPFC) w.e.f. April 01, 2009.
 
 c.  Post Retirement Medical Benefit (PRMB) (Non-funded Scheme): Under
 this scheme, employees get medical benefits subject to certain limits
 of amount, periods after retirement and types of benefits, depending on
 their grade at the time of retirement. Employees separated from the
 Company as part of early separation scheme are also covered under the
 scheme.
 
 The disclosures as required under AS-15 are as under:
 
 The contribution expected to be made by the Company during financial
 year ending June 30, 2011 has not been ascertained.
 
 Note : The Companys Provident Fund was administered by Companys own
 trust fund till March 31, 2009. Accordingly, the disclosures relating
 to Provident Fund as required in accordance with AS-15, has been given
 for the previous period from July 1, 2008 to March 31, 2009. The entity
 has moved to the Provident Fund Contribution to Regional Provident Fund
 Office w.e.f. April 01,2009.
 
 3.  (a) Managerial Remuneration under Section 198 of the Companies Act,
 1956
 
 (b) The above Managerial Remuneration includes Rs.3 56 88 847 (Previous
 year : Rs.3 38 95 131) cross charged to Gillette India Limited and
 Procter and Gamble Home Products Limited in terms of the common service
 agreement referred to in Note B.17 below.
 
 (c) The above Managerial Remuneration excludes Rs.27 52 204 (Previous
 year : Rs.26 00 528) cross charged from Gillette India Limited in terms
 of the common service agreement referred to in Note B. 17 below.
 
 Notes :
 
 1.  The installed capacities as at the year-end are as certified by the
 management.
 
 2.  Actual production includes production under manufacturing
 arrangement with third parties.
 
 4.  Excise duty deducted from turnover represents amount of excise duty
 collected by the Company on sale of goods.  Excise duty shown under
 Schedule 15 - Operating and other expenses represents difference in
 amount of excise duty on closing stock and opening stock of finished
 goods.
 
 5.  There are no outstanding derivative instruments as at June 30,
 2010.
 
 Foreign currency exposures that have not been hedged by the Company by
 a derivative instrument or otherwise are given below:
 
 6.  The Company has taken on lease guesthouses, accommodation for
 employees and godowns for storage of inventories, with an option of
 renewal at the end of the lease term and escalation clause in some of
 the cases.  These leases can be terminated with a prior notice as per
 terms and conditions of the respective lease agreements with the
 lessor. Lease payments amounting to Rs. 5 13 85 433 (Previous year : Rs. 3
 88 58 655) have been charged to the Profit and Loss Account for the
 year. There are no non cancellable lease agreements.
 
 7.  Disclosures under the Micro, Small and Medium Enterprises
 Development Act, 2006:
 
 (a) No payments were due and outstanding to suppliers covered under the
 Micro Small and Medium Enterprises Development Act, 2006 as at the end
 of the current and previous accounting year on account of Principal and
 Interest respectively.
 
 (b) No interest was paid in the current and the previous accounting
 year.
 
 (c) No interest was payable at the end of the current and previous
 accounting year other than interest under Micro, Small and Medium
 Enterprises Development Act, 2006.
 
 (d) No amount of interest was accrued and unpaid at the end of the
 current and previous accounting year.
 
 The above information and that given in Schedule 10 Current
 Liabilities regarding Micro, Small and Medium Enterprises has been
 determined to the extent such parties have been identified on the basis
 of information available with the Company. This has been relied upon by
 the auditors.
 
 (b) Loans and Advances includes
 
 Car Loan to a Director amounting to ^ 15 33 049 (Previous year : ^17 80
 001) which was approved by the Ministry of Corporate Affairs vide its
 letter no. 6/17/2007-CL.VI dated November 1, 2007. The maximum balance
 outstanding during the year amounted to Rs. 17 80 001 (Previous year :
 Rs.18 80 760).
 
 8.  Related Party Disclosures:
 
 The Group Companies of The Procter & Gamble Company, USA include, among
 others, Procter & Gamble India Holdings BV; Procter & Gamble Iron Horse
 Holding BV; Procter & Gamble Eastern Europe LLC; Procter & Gamble
 Nordic LLC; Procter & Gamble Global Holdings Limited; Procter & Gamble
 Luxembourg Global SARL; Procter & Gamble International SARL; Procter &
 Gamble India Holdings Inc.; Procter & Gamble International Operations
 SA; Gillette Group (Europe) Holdings BV; Procter & Gamble Canada
 Holding BV; Procter & Gamble Overseas Canada BV; Procter & Gamble
 Overseas India BV; Procter & Gamble Asia Holding BV; Rosemount LLC.
 
 (a) Parties where control exists :
 
 The Procter and Gamble Company, USA - Ultimate Holding Company Procter
 and Gamble Asia Holding BV, The Netherlands - Holding Company
 
 (b) Other related parties with whom transactions have taken place
 during the year
 
 (i) Fellow Subsidiaries:
 
 Procter & Gamble Home Products Ltd.
 
 Procter & Gamble Malaysia Sdn. Bhd.
 
 Procter & Gamble Manufacturing (Thailand) Ltd.
 
 Procter & Gamble Lanka Pvt. Ltd.
 
 Procter & Gamble (Changdu) Ltd.
 
 Procter & Gamble Asia Pte. Ltd.
 
 Procter & Gamble Australia Pty. Ltd.
 
 Procter & Gamble US Business Services Company
 
 Procter & Gamble International Operations Pte. Ltd.
 
 Procter & Gamble Northeast Asia Pte. Ltd.
 
 Procter & Gamble International Operations SA
 
 Gillette India Ltd.
 
 Procter & Gamble Singapore Pte. Ltd.
 
 Gillette Diversified Operations Private Limited
 
 Procter & Gamble Distributing (Philippines) Inc.
 
 Procter & Gamble Panda Detergent Ltd., Beijing
 
 Procter & Gamble Tuketim Mallari Sanayl
 
 Procter & Gamble (Guangzhou) Ltd.
 
 Procter & Gamble UK
 
 Procter & Gamble Product Supply (UK) Ltd.
 
 Procter & Gamble Technology (Beijing) Co.
 
 Procter & Gamble Vietnam Ltd.
 
 Procter & Gamble Asia Pte. Ltd. (MROH)
 
 Procter & Gamble Kabushiki Kaisha
 
 Procter & Gamble Far East. Inc.
 
 Procter & Gamble Korea Inc.
 
 Procter & Gamble S.A., Chile
 
 P&G (East Africa) Ltd.
 
 PT P&G Home Products, Indonesia
 
 P&G Ceemea - A Division of P&G International Operations SA
 
 Fameccanica Machinery (Shanghai) Co.
 
 Procter & Gamble Korea S&D Co.
 
 Procter & Gamble Philippines Inc.
 
 Procter & Gamble Technical Centers Ltd.
 
 Procter & Gamble Trading (Thailand) Ltd.
 
 Procter & Gamble Bangladesh Pvt. Ltd.
 
 Procter & Gamble Manufacturing Company
 
 Procter & Gamble Europe N.V.
 
 Wella India Hair Cosmetics Pvt. Ltd.
 
 Procter & Gamble Eastern Europe LLC
 
 Procter & Gamble (Manufacturing) Ireland Ltd.
 
 The P&G Distributing LLC
 
 Procter & Gamble Taiwan Ltd.
 
 Rosemount LLC
 
 Procter & Gamble Hair Care LLC
 
 (ii) Key Managerial Personnel of the Company No. of shares held
 
 Mr. Shantanu Khosla, Managing Director 67 (Previous year : 67)
 
 All the employees of the Company including its managing directors are
 given the right to purchase shares of the ultimate holding Company -
 The Procter and Gamble Company, USA under its Employee Stock Option
 Plan.
 
 Under the above plan Mr. Shantanu Khosla has been granted the right to
 purchase 100 shares (Previous year : NIL) during the year.
 
 10.  The Company operates in a single reportable business segment i.e.
 Manufacturing and Marketing of Health and Hygiene Products and one
 reportable Geographical segment i.e. within India.
 
 11.  (a) International Stock Ownership Plan (Stocks of the Parent
 Company)
 
 The Procter and Gamble Company, USA has an International Stock
 Ownership Plan (employee share purchase plan) whereby all permanent
 employees of the Company have been given a right to purchase shares of
 the Company. Every employee who opts for the scheme contributes up to a
 specified percentage (upto 15%) of his base salary towards purchase of
 shares on a monthly basis.  The Company contributes 50% of employees
 contribution (restricted to 2.5% of his base salary). Such contribution
 is charged to staff cost.
 
 The shares of The Procter & Gamble Company, USA are listed with New
 York Stock Exchange and are purchased on behalf of the employees at
 market price on the date of purchase.
 
 During the year ended June 30, 2010, 5558.35 shares (Previous year :
 4154.25 shares) were purchased by employees at weighted average fair
 value of Rs.2 799 (Previous year : Rs.2 845) per share.
 
 The Companys contribution during the year on such purchase of shares
 amounting to Rs.31 88 450 (Previous year : Rs.32 06 498) has been
 charged to the Profit and Loss Account.
 
 (b) Employees Stock Options Plan (Stocks of the Parent Company)
 
 The Procter and Gamble Company, USA has a Employee Stock Option Plan
 whereby the employees covered by the plan are granted an option to
 purchase shares of the ultimate holding company i.e. - The Procter and
 Gamble Company, USA at a fixed price (grant price) for a fixed period
 of time. The shares of The Procter & Gamble Company, USA are listed
 with New York Stock Exchange. The options Exercise price is equal to
 the market price of the underlying shares on the date of the grant.
 Accordingly no stock compensation expenses have been incurred by the
 Company during the year. The Grants issued are vested after 3 years and
 have a 10 years life cycle.
 
 12. In terms of rules applicable to the employees whose services have
 been seconded to Procter & Gamble subsidiaries abroad, Rs.2 96 875
 (Previous year : Rs.33 01 008) has been contributed to Provident
 Fund/Superannuation trusts in respect of Mr. P. Agarwal.
 
 Also in terms of rules applicable to the employees retiring after the
 age of 50, Rs.Nil (Previous year : Rs.9 755) was paid as reimbursement of
 medical expenses to Mr. B. V. Patel, who was a director of the Company
 till March 31, 2009.
 
 As these payments have been made in the capacity of a seconded
 employee/retired employee and not related to their directorship,
 provisions of Sections 198, 309, 310 and 314 of the Companies Act, 1956
 are not applicable.  Legal opinion confirms this position. Thus the
 same has not been considered as managerial remuneration.
 
 13.  Common service expenses paid/recovered include payments/recoveries
 on account of finance, personnel, secretarial, administration and
 planning services rendered under common services agreements with
 Procter and Gamble Home Products Limited and Gillette India Limited.
 
 14.  Salaries, wages and bonus under Schedule 15 include Rs.2 38 61 880
 (Previous year : Rs.3 13 90 800) towards expenditure on Voluntary
 Retirement Scheme.
 
 15.  The Malabar Company - a Delaware Corporation, an Overseas
 Corporate Body (OCB) has merged with Rosemount LLC, a P&G group Company
 with effect from August 20, 2009.
 
 As a result the overall shareholding of The Procter and Gamble Company,
 USA (the ultimate holding company) in the Company stands increased from
 2 23 10 090 shares (68.73%) to 2 29 29 773 shares (70.64%).
 
 16.  Professional fees in Schedule 15 Operating and other expenses
 includes an amount of Rs.71 695 (Previous year : Rs.71 695) on account of
 fees to cost auditors.
 
 17.  No borrowing costs were capitalised during the year.
 
 18.  Previous years figures have been regrouped/rearranged wherever
 considered necessary.