Thomas Cook (India)

(a) Estimated amount of contracts remaining to be executed on capital
 account and not provided for Rs. 1,153,730 (Previous Year Rs.
 4,826,034).
 
                                        As at 31st         As at 31st
                                    December, 2008     December, 2007
                                            Rupees             Rupees
 
 (b)  Contingent Liabilities
 
 (i) Claims against the Company 
 not acknowledged as debts:
 
 Demand from Bombay Electricity 
 Supply and Transport (BEST) for         1,961,083          1,961,083
 Electricity
 
 Disputed Demand from DGFT, 
 Mumbai under EPCG Licence              13,789,235         13,789,235
 
 (ii) Disputed Income-tax Demands       68,248,295          7,485,557
 
 (iii) Disputed Service Tax Demands     98,200,280                  -
 
 (iv) Disputed Demand for increase in 
 rent raised by Brihanmumbai Municipal  33,076,960         33,076,960
 Corporation
 
 (v) Corporate Guarantee given to a 
 bank for the credit facilities 
 extended by                            73,065,000         59,122,500
 the said bank to Thomas Cook 
 (Mauritius) Operations Company Limited
 
 Note:
 
 Future cash outflows in respect of (i) to (iv) above are determinable
 only on receipt of judgements/decisions pending with various
 forums/authorities. Future cash outflows in respect of (v) above are
 determinable only in the event of invocation of the guarantee
 consequent to default, if any, in repayment of dues to the bank by
 Thomas Cook (Mauritius) Operations Company Limited.
 
 (c) The tax year for the Company being the year ending 31st March, the
 provision for taxation for the year is the aggregate of the provision
 made for the three months ended 31st March, 2008 and the provision
 based on the figures for the remaining nine months up to 31st December,
 2008, the ultimate tax liability of which will be determined on the
 basis of the figures for the period 1st April, 2008 to 31st March,
 2009.
 
 (d) Micro and Small Scale Business Entities
 
 There are no Micro and Small Enterprises, to whom the Company owes
 dues, which are outstanding as at 31st December, 2008. This information
 as required to be disclosed under the Micro, Small and Medium
 Enterprises Development Act, 2006 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.
 
 (i) Related Party Disclosures
 
 (A) Enterprises where control exists
 
 (i) Holding Company From 28th March, 2008:
 
 TCIM Limited, UK holds 54.42% of Equity Shares of the Company. Thomas
 Cook UK Limited, the Holding Company of TCIM Limited, UK owns 20.48% of
 Equity Shares of the Company. Thomas Cook UK Limited is a step down
 subsidiary of Thomas Cook Group plc, the ultimate holding company.
 
 Upto 27th March, 2008:
 
 TCIM Limited, UK held 54.42% of Equity Shares of the Company. Dubai
 Financial (LLC), the Holding Company of TCIM owns 7.36% of the Company.
 Dubai Financial (LLC) is a wholly owned subsidiary of Dubai Group, the
 Global investment arm of Dubai Holdings.
 
 (e) Turnover includes
 
 (i) Brokerage and Incentives paid netted off Rs. 240,993,930 (Previous
 Year Rs. 229,822,495)
 
 (ii) Exchange profit on revaluation of Nostra and other Bank Accounts
 used for holding foreign currency for travel business Rs.  24,409,780
 (Previous Year loss Rs. 24,882,000).
 
 (f) The Company has considered Non Compete Fees paid during the
 financial year ended 31st December, 2007 as an allowable expenditure
 for the purpose of computing the provision for tax for the year ended
 31st December, 2007 based on legal opinion.  The assessment proceedings
 for the relevant assessment year have not been completed.
 
 (g) Subsequent to the Annual General Meeting of the company held on
 27th June, 2008, the Company has appointed an Executive Director for a
 period of two years with effect from 25th November, 2008 and the
 company has paid remuneration of Rs. 2,473,348 for the period. The
 appointment and remuneration of the said Executive Director is subject
 to the approval of the members in the general meeting and the Central
 Government of India for which an application has been made.
 
 (h) The Management has reviewed the operations of its various
 Branches/Divisions and based on this review the Management has Closed
 the travel / forex Branches and thereby incurred a sum of Rs.
 13,566,679 on account of personnel cost, professional fees and loss on
 disposal of assets.
 
 (i) During the year the Company has issued 1% Cumulative
 Non-Convertible Redeemable Preference Shares of Rs. 10 each amounting
 to Rs.1,050,000,000 redeemable on 29th January, 2009 @ 10% premium. The
 premium on preference shares was to be adjusted against the Share
 Premium account arising on the rights issue scheduled to be completed
 before 31st December, 2008. However, the rights issue opened only on
 31st December, 2008 and got closed on 14th January, 2009. The company
 has adjusted the premium on redemption of preference shares against the
 Share Premium received on the rights issue. The total proceeds relating
 to rights issue amounting to Rs. 1,798,099,815 (including premium
 Rs.1,747,449,116) was received prior to the date of redemption of
 preference shares and the resultant premium on rights issue was more
 than sufficient to adjust the premium on redemption of preference
 shares.
 
 (j) During the year ended 31st December, 2008, the Company has paid
 charges of Rs. 31,896,150 on issue of preference shares. This included
 payments on account of fees paid to Registrar of Companies, franking
 and stamping charges as well as advisory fees for structuring the
 preference share issue. The same has been disclosed as an Exceptional
 Item.
 
 (k) Derivative Instruments
 
 The Company uses Forward Exchange Contracts to hedge against its
 foreign currency exposures related to the underlying transactions and
 firm commitments. The Company does not enter into any derivative
 instruments for trading or speculative purposes.
 
 (l) Employees of the Company and other parties misappropriated assets
 aggregating to Rs. 7,251,682 during the year. The Company has recovered
 Rs. 4,047,146 so far. The cases are under investigation and Company has
 taken steps for recovering the balance amount. There is no open
 exposure on the profit for the year in respect of misappropriated
 assets except for Rs. 751,100.
 
 (m) Subsequent Event
 
 During the current year, the Company came out with Rights issue of
 56,278,554 fully paid-up Equity shares in ratio of 35 (thirty five)
 fully paid up equity shares for every 100 (hundred) fully paid up
 Equity Share held by the existing shareholders on the record date 27th
 December, 2008. Pursuant to this the Company at its Committee meeting
 held on 21st January, 2009 allotted 50,650,699 fully paid up Equity
 Shares of Re. 1/- each for cash at a price of Rs. 35.50 (including a
 share premium of Rs. 34.50) per equity share aggregating to Rs.
 1,798,099,815. The shares thus allotted rank pari passu with the
 existing shares of the Company with respect to the dividends declared
 by the Company for the year ended 31st December, 2008 and the proposed
 dividend has been determined accordingly.
 
 (n) Previous year figures have been regrouped where necessary.