1. Estimated amount of pontracts remaining to be executed on capital
 account and not provided for (net of advances) Rs. 84.50 lac (Previous
 year Rs. 246.88 lac).
 
 2. Contingent Liabilities
 
 (a) Claims not acknowledged as debts :
 
 (i) The District Collector, Tuticorin vide his letter dated; 21 August
 2009 had demanded Rs. 16873.97 lac (Previous year Rs. 16873.97 lac)
 towards lease rent for the utilization of 415.19 acres of sand quarry
 poramboke lands by the Company for its effluent treatment and storage
 of Gypsum for the period from 1975 to 2008 while the assignment
 proposal submitted by the Company in the year 1975 to the State
 Government is still pending. The Company had filed a writ petition
 challenging the demand before the Hon''ble Madras High Court and the
 court granted interim stay vide its order dated 21 April 2010 on
 further proceedings.
 
 (ii) The Phosphate Chemical Export Association Inc. USA (Phoschem)
 filed a suit before the Hon''ble Madras High Court for recovery of
 US.52 million (INR equivalent 5143.68 lac) during March 2006 towards
 supply of raw material to the Company. The court passed an interim
 decree in favour of Phoschem for US.76 million (INR equivalent
 3911.34 lac) against which the Company filed a Review Petition on the
 ground that the Hon''ble High Court has not considered the realization
 of US.31 million by Phoschem from the Insurance company. The Review
 Petition is still pending before the Hon''ble High Court. The Company
 had already made a provision of Rs. 3872.20 lac (Previous year Rs.
 3914.70 lac) towards this claim and the balance claim not acknowledged
 by the Company is Rs. 1234.25 lac (Previous year Rs. 1247.80 lac).  -
 
 (iii) Groupe Chimique Tunisian SA (GCT) initiated arbitration
 proceedings against the Company for non payment of US$ 15.02 million
 together with interest towards supply of Phosphoric Acid in the earlier
 years against which the Arbitral Tribunal passed an award on 9September
 2009 directing the Company to pay a sum of Rs. 7300 lac to GCT towards
 principal and Rs. 2500 lac towards interest. The Company filed a
 petition before the Hon''ble Madras High Court on 7 December 2009 for
 setting aside the award and the Court ordered notice to GCT on 23
 December 2009- The matter is pending before the Hon''ble Madras High
 Court. As the Company had already made a provision of Rs. 6565.52 lac
 (Previous year Rs. 6637.57 lac), the remaining claim not acknowledged
 by the Company on this account is Rs. 3234.48 lac (Previous year Rs.
 3163 lac).
 
 (iv) As the Nitrogenous plants were not in operation, Tamilnadu Water
 Supply and Drainage Board (TWAD) has claimed payments on the basis of
 50% allotted quantity of water. Water Charges were paid to TWAD on the
 basis of actual receipt by individual industries (since inception of 20
 MGD Scheme) for the last 36 years. The claims made by TWAD for Rs.
 692.79 lac is not acknowledged as debt, as this differential value from
 April 2009 to December 2010 is not supported by any Government Order
 and also the other beneficiaries are objecting to such claims of TWAD.
 
 (v) Other claims against the Company, which are being
 disputed/challenged before the Courts - Rs. 4155.82 lac (Previous year
 Rs. 4167.05 lac).
 
 In respect of the above claims, the Company has been advised that there
 are reasonable chances of successful outcome of the Appeals / Petitions
 filed before the Hon''ble Madras High Court/Government Authorities and
 accordingly no further provision is considered necessary.
 
 (b) Guarantees/Security given to Banks/Financial Institutions on behalf
 of other companies Rs. 4500 lac (Previous year Rs. 4500 lac)
 
 (c) Other Bank Guarantees outstanding Rs: 781.78 lac (Previous year Rs,
 803.07 lac)
 
 (d) Cumulative amount of Preference Dividend and Dividend Tax thereon
 not provided for the period from 1 April 2001 to 31 March 2011 is Rs.
 2112.30 lac (Previous year Rs. 1935.94 lac)
 
 (e) No provision has been considered necessary by the management for
 the following disputed Income Tax, Sales Tax, Excise duty, Service tax,
 Electricity tax and Employees State Insurance demands which are under
 various stages of appeal proceedings. The Company has been advised that
 there are reasonable chances of successful outcome of the appeals and
 hence no provision is considered necessary for these demands.
 
 3. (a) Consequent to the implementation of Corporate Debt Restructuring
 (CDR) Package dated 19 March 2003, the Company had availed interest
 relief from various banks and financial institutions amounting to Rs.
 4110.36 lac (Previous year Rs. 4110.36 lac), for the year 2002-03 and
 therefore accrued the interest liability at the reduced rates in the
 subsequent years up to 31 March 2008.
 
 (b) As the Corporate Debt Restructuring (CDR) Package referred above
 did not yield the desired results, the secured lenders preferred to
 assign their debts in favour of Asset Reconstruction Company (India)
 Limited (ARCIL). As on 31 March 2011, approximately 85% of secured
 lenders in value stands assigned the financial assistance granted by
 them along with the attendant security interests in favour of ARCIL
 under the provisions of SARFAESI Act.
 
 ARCIL and other financial institutions (except one lender) have
 approved the rework package dated 13 March 2010 through Corporate Debt
 Restructuring (CDR) mechanism (read with Term Sheet of ARCIL dated 28
 March 2010) on successful implementation of which the Company would be
 eligible for substantial reduction in debts and interest accrued
 thereon. The total payment to ARCIL/Secured lenders upto 31 March 2011
 amounted to Rs. 82555.15 lac (Previous year Rs. 35999.47 lac) including
 a sum of Rs. 46555.68 lac (Previous year Rs. 35999.47 lac) paid during
 the year for distribution to secured lenders (including to those whose
 debts had not been assigned to ARCIL). ARCIL and certain other secured
 lenders have also converted part of the debts amounting to Rs. 5745 lac
 (Previous year Rs. 3000 lac) into equity as stipulated in the CDR
 Rework Package, including Rs. 2745 lac (Previous year Rs. 3000 lac)
 converted during the year. There has been delay in payment of some loan
 installments which may entail additional outflow as per the rework
 package. In the event of the Company not being able to comply with the
 stipulated conditions as per the rework package, the same shall be
 withdrawn. In view of the delay in payment of installments and pending
 satisfactory completion/compliance of the conditions stipulated in the
 package, no credit has been taken for expected relief in loan/interest
 liabilities.
 
 (c) The Company executed a Memorandum of Understanding with Indian Oil
 Corporation Limited (IOCL) on 19 April 2010 mutually agreeing the terms
 and conditions for the execution of the Supply Agreement for resumption
 of supply of Naphtha and Furnace Oil and settlement of certain past
 dues. The Supply Agreement was also executed by the Company with IOCL
 on 24 April 2010 for the supply of Naphtha and furnace oil on agreed
 terms and conditions. During the year, the Company has paid Rs. 11000
 lac towards settlement of past dues, including a sum of Rs. 3000 lac
 released by the lead bank from the Trust and Retention Account (TRA) as
 per the decision of Corporate Debt Restructuring Empowered Group(CDREG)
 on 31 August 2009 and directive of Hon''ble Debt Recovery Tribunal
 (Hon''ble DRT) vide its order dated 22 September 2009.
 
 (d) The Company has assigned exclusive charge of all raw materials,
 work-in-process, finished goods and concession relating to phosphatic
 fertilisers, to a bank against working capital facility for purchase of
 raw materials.
 
 (e) The Pen-G operations were shut down from 15 January 2010 due to
 then prevailing un-remunerative prices on account of Chinese
 competition. The Company initiated steps by representing to the
 Government of India to impose anti dumping duty on imports of Pen-G and
 6-APA from China and Mexico. The Company was successful in obtaining
 the recommendation of the Ministry of Commerce for imposition of anti
 dumping duty. However the Ministry of Finance had rejected the
 recommendation of the Commerce Ministry for levying anti dumping duty,
 which prevented the Company from competing on a level playing field. As
 a result the Company has not been able to restart the Pen-G operations.
 
 Pursuant to the sale of Land and Building at Maraimalai Nagar during
 March 2011 the assets relating to R&D and API lying in this location
 were transferred to Pen-G plant at Cuddalore.
 
 In view of the Company''s inability to restart the Pen-G operations and
 also considering non-viability of operations relating to R&D and API,
 ARCIL vide notice dated 17 May 2011, has taken over the possession of
 immovable properties of the Pharma unit at Cuddalore to sell the
 assets.
 
 In pursuance of Accounting Standard 28 - Impairment of Assets (AS - 28)
 notified by the Central Government of India under the Companies
 (Accounting Standards) Rules, 2006 and with the relevant provisions of
 the Companies Act, 1956, the Company has reviewed its carrying cost of
 assets viz., buildings, plant and machinery, furnitures and fittings
 and intangible assets relating to Pharma Unit and has provided for
 impairment loss estimated at Rs. 920.02 lac which is included in
 Manufacturing & Other Expenses.
 
 (f) One lender had sent a communication to the Company withdrawing its
 consent to the CDR package dated 19 March 2003 and advised the Company
 to take note of the same. However the Company has not received any
 demand from this lender so far.  Also the said institution is not a
 party to the CDR rework package dated 13 March 2010.
 
 4.  Going Concern
 
 In spite of erosion of net-worth, the financial statements of the
 Company have been prepared on a going concern basis, in view of the
 following:
 
 i) The Company has re-commenced the production of Urea from 9 October
 2010 and the production has stabilized.  The production of Phosphatic
 fertilisers continued during the current year. The other Divisions viz
 SPIC Maintenance Organization, Enzymes, Formulation Units and
 Agribusiness continued their operations throughout the financial year.
 This has resulted in significant reduction in operating loss.
 
 ii) The Supply Agreement executed on 24 April 2010 by the Company with
 Indian Oil Corporation Ltd. (IOCL) has enabled the Company to source
 naphtha and furnace oil and recommencement of operations of its
 nitrogenous fertiliser plants from 9 October 2010.
 
 iii) The action of Department of Fertilisers, Government of India
 (GOI), to cut down the urea subsidy payment cycle resulted in reduction
 of working capital requirement and enabled the Company to operate its
 nitrogenous fertiliser plants at stipulated capacity levels.
 
 iv) The Notification was issued by the Department of Fertilisers,
 Government of India (GOI), increasing the fixed cost reimbursement in
 urea operations resulted in additional realization of fertiliser
 subsidy and consequent improvement in profitability.
 
 The above positive developments have enabled the Company to operate the
 fertiliser plants, being its core business, at optimum levels resulting
 in profitable operations and reducing the accumulated losses.
 
 v) The rework package dated 13 March 2010 approved under Corporate Debt
 Restructuring (CDR) mechanism (read with Term Sheet of ARCIL dated 28
 March 2010), as referred in Note 3 (b) envisages bringing down the
 debts to a sustainable level consequently improving the net-worth.
 
 * The revaluation uplift in respect of major assets disposed off
 amounts to Rs. 15391.16 lac which is netted off above.
 
 5.  The Company''s investments included Rs. 18453.62 lac (Previous year
 Rs. 18453.62 lac) in equity share capital of SPIC Fertilizer and
 Chemicals Limited, Mauritius, which has invested in a wholly owned
 subsidiary company, viz: SPIC Fertilizers and Chemicals, FZE, Dubai(SFC
 FZE Dubai), whose dbjective was production of ammonia and urea in Jebel
 Ali Free Zone, Dubai. Since the project did not materialize due to non
 allocation of gas, the said subsidiary company had commenced activities
 for dismantling the existing plant and machinery at the project site
 with a view to relocate the same where assured gas supply could be
 obtained. However, the project remained a non-starter.
 
 Meanwhile, the Jebel-Ali Free Zone Authorities (JAFZA), Dubai had
 issued a notice on 24 March 2010 to SFC FZE Dubai, for vacation of site
 and surrender of materials and machineries on site to JAFZA towards
 land lease arrears amounting to Rs. 2483.50 lac (equivalent to
 20334918.75 AED) due to them failing which they will initiate legal
 action against the said company. SFC FZE, Dubai, has conveyed its
 consent to the above authorities to avoid proposed legal action and
 consequent damages. However, full provision has already been made by
 the Company for the carrying value of investment in SPIC Fertilizer and
 Chemicals Limited, Mauritius, along with other dues from it.
 
 6.  Capital work in progress/advances include a sum of Rs. 2091.04 lac
 (Previous year Rs. 2091.04 lac) being advances paid to MCC Finance
 Limited for purchase of certain immovable properties. The Company
 entered into sale agreements for these properties with MCC Finance
 Limited and the execution and registration ''Of sale deeds are pending.
 The Administrator/ Provisional Liquidator of MCC Finance Limited filed
 a Petition before the Company Court at Chennai seeking a direction that
 the sale agreements entered into between the Company and MCC Finance
 Limited be declared null and void. The said Petition was allowed by the
 Single Judge on 18 June 2003. The Company has filed an appeal against
 the Order before the Division Bench of the Hon''ble Madras High Court.
 The Division Bench admitted the appeal and ordered status quo be
 maintained, pending disposal of the appeal.
 
 7.  The Company promoted SPIC Petrochemicals Limited (SPIC Petro) in
 1994-95 for the manufacture of Polyester Filament Yarn (Capacity: 80000
 TPA) and Purified Terepthalic Acid (Capacity: 315000 TFA). The Company
 has so far invested Rs. 25375.00 lac in the equity share capital, Rs.
 5.00 lac in 8% redeemable cumulative non convertible preference share
 capital, Rs. 30609.63 lac in Unsecured Zero Interest Bonds redeemable
 after 12 years from the date of commencement of commercial production
 or repayment of all the term loans to the lenders, whichever is
 earlier. In view of the pending litigation between Chennai Petroleum
 Corporation Limited (CPCL) and the Company and the consequent interim
 injunction granted by the Hon''ble Madras High Court in 1997 to stop
 implementation of activities, there has been a suspension of
 activities.
 
 While SPIC PetrO was pursuing its revival efforts, the Hon''ble Single
 Judge of the Hon''ble Madras High Court ordered the winding up of the
 company on 17 April 2009 and appointed the Official Liquidator to take
 charge of all the properties and effects of the company, at the time of
 disposing the winding up petitions filed by certain unsecured
 creditors.
 
 Against the above winding up order, SPIC Petro filed an appeal and
 obtained an interim stay from the Division Bench of the Hon''ble Madras
 High Court on 5 May 2009. After several hearings, the Division Bench
 vide its order dated 16 December 2009 directed SPIC Petro to pay an
 amount of Rs. 110 lac as part-payment to certain unsecured creditors
 who have initiated the winding up proceedings before the court, on or
 before 31 March 2010. Since SPIC Petro was unable to make the above
 payment on or before 31 March 2010, the Division Bench of the Hon''ble
 Madras High Court, dismissed the appeal on 26 April 2010. Meanwhile,
 ARGIL issued a notice on 19 March 2009, u/s 13(2) of the Securitisation
 and Reconstruction of Financial Assets and Enforcement of Security
 Interest Act, 2002 (SARFAESI Act), directing SPIC Petro to make payment
 of the dues to ARCIL within sixty days from the date of the notice. As
 SPIC Petro could not make the payment, ARCIL took over the possession
 of the assets of SPIC Petro, under SARFAESI Act on 13 May 2010.
 
 However, the Official Liquidator appointed by the Hon''ble Madras High
 Court has taken over possession of the assets and effects of SPIC Petro
 on 14 May .2010, in accordance with the order issued by the Division
 Bench of the Hon''ble Madras High Court on 26 April 2010. Consequent to
 the above, the nominee directors of SPIC Limited have ceased to be
 directors of SPIC Petro with effect from 14 May 2010. On an appeal
 preferred by ARCIL, the Hon''ble Madras High Court vide its order dated
 20 December 2010 directed the official Liquidator to hand back the
 possession of the above mentioned assets to ARCIL, pursuant to which
 ARCIL took repossession of the same on 4 January 2011.
 
 In view of the above developments, the Company has lost its control
 over SPIC Petro and hence it ceased to be a subsidiary of the Company.
 However, full provision has already been made in the earlier years for
 the carrying value of investments and also for all other dues from this
 Company.
 
 8.  The Company has given an undertaking to the lenders of Tuticorin
 Alkali Chemicals and Fertilisers Limited for non disposal of its
 shareholdings in the said company without their prior approval.
 
 9.  The Company has disposed of Fertiliser bonds issued by Government
 of India with a face value of Rs. 434.90 lac (Previous year Rs. 2600.00
 lac) during the current year and the loss on sale of such bonds
 amounting to Rs. 60.89 lac (Previous year profit Rs. 66.23 lac) has
 been debited to the Profit & Loss Account under the head Manufacturing
 and Other Expenses.
 
 10.  The GOI has introduced Nutrient Based Subsidy Scheme (NBS)
 effective from 1 April 2010 for phosphatic fertilisers and as per this
 policy the concession payable is fixed for the entire financial year
 with open MRR Concession income has been recognised in the books of
 accounts based on the applicable concession under NBS for the year
 2010-11. Hence, no estimates are necessary for the concession to be
 received from GOI, as has been the practice by the company, hitherto.
 
 11.  Sundry debtors and loans & advances include certain overdue and
 unconfirmed balances. However, in the opinion of the Management these
 current assets would in the ordinary course of business realize the
 value as stated in the accounts.
 
 12. There is no provision for tax in view of the carried forward losses
 / unabsorbed depreciation relating to earlier years available for set
 off while computing income both under provisions of section 115-JB and
 those other than section 115-JB of the Income Taix Act, 1961.
 
 13.  Related party disclosure under Accounting Standard -18
 
 (i) The list of related parties, as identified by the management are as
 under:
 
 Subsidiaries
 
 1 Orchard Microsystems Limited
 
 2 Indo-Jordan Chemicals Company Limited, Jordan (ceased to be a
 subsidiary with effect from 21 April 2010)
 
 3 SPIC Fertilizers and Chemicals Limited, Mauritius
 
 4 SPIC Fertilizers and Chemicals, FZE, Dubai
 
 5 SPEL Semiconductor Limited
 
 6 SPEL America Inc., USA
 
 7 SPIC Petrochemicals Limited (ceased to be a subsidiary - with effect
 from 14 May 2010 Refer Note B-8 of Schedule 16)
 
 Associates
 
 1 Tuticorin Alkali Chemicals & Fertilisers Limited
 
 2 Manali Petrochemical Limited
 
 (ceased to be an Associate with effect from 9 March 2011)
 
 3 Gold Nest Trading Company Limited
 
 4 EDAG Engineering Limited
 
 (ceased to be an Associate with effect from 27 October 2010)
 
 Joint Ventures
 
 1 Tamilnadu Petroproducts Limited
 
 2 National Aromatics and Petrochemicals Corporation Limited.
 
 Key management personnel of the Company
 
 1.  Dr. AC Muthiah
 
 2.  Thiru Ashwin C Muthiah
 
 Relatives of Key Management Personnel of the Company (with whom there
 were transactions during the year 2010-11)
 
 1.  Thirumathi Devaki Muthiah
 
 Enterprise owned by / over which Key
 Management Personnel is able to
 exercise significant influence
 
 1 Wilson International Trading Pte Limited, Singapore
 
 2 Manali Petrochemical Limited
 
 14 (a) Previous year figures have been regrouped / recast, wherever
 necessary, to conform to the classification of the current year.  (b)
 Previous year figures are given in brackets.