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A Oneindia Venture

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Sensex 84,929.36 +0.53%

Nifty 25,966.40 +0.58%

22k Gold ₹ 12,300 /gm

Notes to Accounts of DCM Shriram Industries Ltd.

Mar 31, 2025

d) Terms, rights, preferences and restrictions attached to equity shares

The Company declares and pays dividends in Indian Rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

A. SECURED I. From Banks

a) Nil (March 31,2024: Rs. 271,21 lakhs) was secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

b) Nil (March 31,2024: Rs. 1,039.98 lakhs) was secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

c) Rs. 1,492.82 lakhs (March 31,2024: Rs. 2,916.89 Lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 6 quarterly instalments, is secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

d) Rs. 531.43 lakhs (March 31,2024: Rs. 1,736.47 lakhs) carrying interest of 8% p.a., repayable in 6 monthly instalments, is secured by first pari-passu charge by way of mortgage/hypothecation on all the Fixed Assets of the Company, excluding assets on exclusive charges.

e) Nil (March 31,2024: Rs. 156.25 lakhs) was secured by residual pari-passu charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

f) Nil (March 31,2024: Rs. 145.12 lakhs) was secured by first pari-passu charge on fixed assets of Daurala Sugar Works - Sugar & Alcohol division, a unit of the Company.

g) Rs. 720.00 lakhs (March 31,2024: Rs. 900.00 lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 16 quarterly instalments, is secured by first pari-passu charge on fixed assets of Daurala Sugar Works - Sugar & Alcohol division, a unit of the Company.

h) Rs. 44.40 Lakhs (March 31,2024: Rs. 59.02 lakhs) is secured by hypothecation of specific asset carrying interest of 8.50%, repayable in 33 monthly instalments.

i) Rs. 2,567.86 lakhs (March 31,2024: Nil) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 20 quarterly instalments, is secured by first pari-passu charge on fixed assets of Daurala Sugar Works - Sugar & Alcohol division, a unit of the Company

II. From Others

i) Nil (March 31,2024: Rs. 346.15 lakhs) was secured by first pari-passu charge on immovable and movable properties of sugar factory at Daurala Sugar Works, a unit of the Company.

ii) Nil lakhs (March 31,2024: Rs. 8.48 lakhs) was secured by hypothecation of specific asset.

B. Unsecured

Rs. 746.99 lakhs (March 31,2024: Rs. 902.86 lakhs), Deposits from public, carries interest between 9% p.a to 10% p.a., are currently repayable after 3 years from the date of acceptance of deposits.

C. The quarterly returns/statements filed by the Company with the banks are in agreement with the books of account of the Company.

39. Operating segments

A. Basis for segmentation

In accordance with Ind AS 108 âSegment Reportingâ as specified in section 133 of the Companies Act, 2013 , the Company has identified three business segments viz. âSugarâ, âIndustrial fibres and related productsâ, and âChemicalsâ. The above segments have been identified and reported taking into account the differing risks and returns, and the current internal financial reporting systems. For each of the segments, the Chief Operating Decision Maker (CODM) reviews internal management reports on at least a quarterly basis. The CODM monitors the operating results separately for the purpose of making decisions about resource allocation and performance measurement (Refer Note 2A(p)).

Segment revenue, results and capital employed include the respective amounts identifiable to each of the segments. Segment revenue, results and capital employed include the respective amounts identifiable to each of the segments. Other unallocable expenditure includes expenses incurred on common services provided to the segments, which are not directly identifiable.

In addition to the material accounting policies applicable to the business segments as set out in note 2A(p) above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses

Segment revenue and expenses are, generally, directly attributable to the segments. Joint revenue and expenses of segments are allocated amongst them on a reasonable basis.

b) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating trade receivables, inventories and property plant and equipment and intangible assets, net of allowances and provisions, which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities and do not include deferred income taxes and borrowings. While most of the assets / liabilities can be directly attributed to individual segments, the carrying amount of certain assets / liabilities pertaining to two or more segments are allocated to the segments on a reasonable basis.

The following summary describes the operations in each of the Company''s reportable segments:

Sugar Comprising sugar, power and alcohol

Industrial fibres and related products Comprising rayon, synthetic yarn, cord, fabric, etc.

Chemicals Comprising organics and fine chemicals

D. Geographical information

The geographical information analyses the Companyâs revenues and assets by the country of domicile (i.e., India) and other countries. In presenting the geographical information, segment revenue has been based on the geographic location of customers and segment assets.

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded, are not likely to, in the opinion of the management, have a material effect on the results of the operations or financial position of the Company.

B. Commitments

a. Capital commitments: Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amount aggregating to Rs. 138.69 lakhs (March 31, 2024: Rs. 250.92 lakhs) relating to Property, plant and equipment.

b. Other commitments: The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in the normal course of business. The Company does not have any long term commitments / contracts, including derivative contracts, with any material foreseeable losses.

c. The Company has given a corporate guarantee of Rs.1,700 lakhs in repsect of loan taken by its wholly owned subsidiary from bank for purchasing immoveable properties

42. A petition challenging the Preferential Issue of equity warrants by the Company filed by a shareholder before the Honâble Company Law Board (now National Company Law Tribunal), pending since November 2007, had been dismissed as withdrawn in the hearing held on March 07, 2023.

A. Defined contribution plans

Rs. 786.22 lakhs (March 31,2024: Rs. 201.03 lakhs) for provident fund contributions and Rs. 252.15 lakhs (March 31,2024: Rs. 254.02 lakhs) for superannuation and national pension scheme fund contributions have been charged to the Statement of Profit and Loss. The contributions towards these schemes are at the rates specified in the rules of the schemes.

B. Defined benefit plans

a) Liabilities for gratuity, privilege leaves and medical leaves are determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

Gratuity:

Gratuity scheme provides for a lump sum payment to vested employees at retirement, death, while in employment, or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

The weighted average duration of the defined benefit obligations as on March 31, 2025 is 13.64 years (March 31, 2024: 13.35 years).

Expected contributions to post-employment benefit plans for the financial year 2025-26 are Rs. 278.19 lakhs (202425: Rs. 230.42 lakhs).

The cost of the defined benefit plans and other long term benefits are determined using actuarial valuations. Actuarial valuations involve making various assumptions that may differ from actual developments in the future. These includes the determination of the discount rate, future salary increases and mortality rate. Due to the complexities involved, the valuation is highly sensitive to the changes in assumptions. All assumptions are reviewed at each reporting date. The present value of the defined benefit obligation and the related current service cost and planned service cost were measured using the projected unit cost method.

The Company has established an income tax approved irrevocable trust fund to which it regularly contributes to finance the liabilities of the gratuity plan. The fundâs investments are managed by certain insurance companies as per the mandate provided to them by the trustees and the asset allocation is within the permissible limits prescribed in the insurance regulations.

The sensitivity analysis above have been determined based on reasonably possible changes of the respective assumptions occurring at the end of reporting period, while holding all other assumptions constant.

Sensitivities due to mortality and withdrawals are insignificant, hence not considered in sensitivity analysis disclosed. viii) Maturity profile

The table below shows the expected cash flow profile of the benefits to be paid to the current members of the plan, based on past service as at the valuation date:

C. Compensated absences:

The obligation of compensated absence in respect of the employees of the Company as at March 31, 2025 works out to Rs. 1,558.43 lakhs (March 31,2024: Rs. 1,447.55 lakhs)

D. Provident fund:

All employees are entitled to Provident Fund benefits as per the law. For certain category of employees the Company administers the benefits through a recognised Provident Fund Trust. The Company has an obligation to fund any shortfall on the yield of the trustâs investments over the administered interest rates on an annual basis. For other employees contributions are made to the Regional Provident Fund Commissioners. The Government mandates the annual yield to be provided to the employees on their corpus. This plan is considered as a Defined Benefit Plan. For the first category of employees (covered by the Trust), the Company has an obligation to make good the shortfall, if any, between the yield on the investments of the trust and the yield mandated by the Government and these are considered as Defined Benefit Plans and are accounted for on the basis of an actuarial valuation.

During the current year, the Company has surrendered the recognition granted to the PF Trust in the name of Employees Provident Fund Trust, DCM Shriram Industries Limited and Daurala Organics Limited Employees Provident Fund Trust with effect from September 01,2024. Accordingly, the entire corpus in respect of all the active and inactive employees has been transferred to the office of respective Regional Provident Fund Commissioner (RPFC).

vi) Sensitivity analysis

The significant actuarial assumption for the determination of defined benefit obligations is the discount rate.

Sensitivity of gross benefit obligation as mentioned above, in case of change in significant assumptions would be as under:

The sensitivity analysis above has been determined based on reasonably possible changes of the respective assumptions occurring at the end of reporting period, while holding all other assumptions constant.

Sensitivities due to mortality and withdrawals are insignificant and hence not considered in sensitivity analysis disclosed.

E. Risk exposure

These defined benefit plans typically expose the Company to actuarial risks as under:

a) Investment Risk

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

b) Interest rate risk

A decrease in bond interest rate will increase the plan liability. However, this shall be partially off-set by increase in return as per debt investments.

c) Longevity risk

The present value of the defined plan liability is calculated by reference to the best estimate of the mortality of plan participants. An increase in the life expectancy will increase the planâs liability.

d) Salary risk

Higher than expected increase in salary will increase the defined benefit obligation.

1) Transactions with the related parties are made on normal commercial terms and conditions and at market rates, to be settled in cash except advance for share capital (refer note 55).

2) Maximum amount outstanding during the year in respect of loan given to subsidiary is Rs.1,567.94 lakhs.

46. Financial instruments - Fair values and risk management

a. Financial instruments - by category and fair values hierarchy

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The following table shows the carrying amounts and fair value of financial assets and financial liabilities, including their levels in the fair value hierarchy.

# The Companyâs borrowings have been contracted at both floating and fixed rates of interests. The borrowings at floating rates reset at short intervals. Accordingly, the carrying values of such borrowings (including interest accrued but not due) approximate fair values. The fair values of long-term borrowings with fixed rates of interest is estimated by discounting future cash flows using current rates (applicable to instuments with similar terms, currency, credit risk and remaining maturities to discount the future payout).

* The carrying amounts of trade receivables, trade payables, lease liabilites, cash and cash equivalents, investments, bank balances other than cash and cash equivalents, and other financial assets and liabilities, approximate the fair values, due to their short-term nature. The other non-current financial assets represents security deposits given to various parties, loans and advances to employees and officers and bank deposits (due for maturity after twelve months from the reporting date), lease liabilities and other non-current financial liabilities, the carrying values of which approximate the fair values as on the reporting date.

a There has been no movement in Level 3 financial instruments.

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended March 31,2025 and March 31,

2024

Valuation

Following financial instruments are remeasured at fair value as under :

(a) The fair values of investments in mutual fund units is based on the net asset value (âNAVâ) as stated by the issuers of these mutual fund units in the published statements as at Balance Sheet date. NAV represents the price at which the issuer will issue further units of mutual fund, and the price at which issuers will redeem such units.

(b) The fair value of all derivative contracts is determined using forward exchange rate at the balance sheet date. b. Risk Management

The Company manages risks arising from financial instruments as under :

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay amounts due, causing financial loss to the Company. It arises from cash and cash equivalents, financial instruments and principally from credit exposure to customers relating to receivables. The Company continuously reviews the credit to be given and the recoverability of amounts due. Majority of the trade receivables are from parties with whom the Company has long standing satisfactory dealings.

* The Company believes that the unimpaired amounts are collectible in full, based on historical payment behaviour.

# The Company continuously reviews the credit to be given and the recoverability of amounts due. Majority of the trade receivables, both domestic and overseas, are from parties with whom the Company has long standing satisfactory dealings. The Company also makes provision for lifetime expected credit loss, based on its previous experience of provisions/write offs in previous years.

Note

Cash and cash equivalents

Credit risk on cash and cash equivalents is limited as the Company generally transacts with the banks with high credit ratings assigned by domestic and international credit rating agencies.

Other financial assets

Other financial assets do not have any significant credit risk (also refer note 52).

(ii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companyâs approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they fall due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companyâs reputation.

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of Rs. 7,137.72 lakhs as at March 31,2025 (March 31,2024 Rs. 3,062.66 lakhs), anticipated future considering internally generated funds from operations fully available and revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if liquidity needs were to arise, the Company believes it has access to financing arrangements, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements, as necessary.

The Companyâs liquidity management process as monitored by management, includes the following:

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Companyâs liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

Market risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risks: currency risk and interest rate risk. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. The Board of Directors is responsible for setting up of policies and procedures to manage market risks of the Company.

Currency risk

Currency risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to the effects of fluctuation in the prevailing foreign currency exchange rates on its financial position and cash flows. Exposure arises primarily due to exchange rate fluctuations between the functional currency and other currencies, from the Companyâs operating, investing and financing activities.

Sensitivity analysis

A reasonably possible strengthening / weakening of the Indian Rupee against below currencies at March 31, 2025 (previous year ended as on March 31, 2024) would have affected the measurement of financial instruments denominated in functional currency and affected equity and profit or loss by the amounts shown below. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

Foreign exchange derivative contracts

The Company uses derivative financial instruments exclusively for hedging financial risks that arise from its commercial business or financing activities. The Companyâs Corporate Treasury team manages its foreign currency risk by hedging transactions that are expected to occur within a period of 1 to 24 months for hedges of forecasted sales, purchases and capital expenditures. When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable or payable that is denominated in the foreign currency. All identified exposures are managed as per the policy duly, approved by the Board of Directors. The fair value is determined using quoted forward exchange rates at the reporting date and present value calculations based on high credit risk quality yield curves in the respective currency.

Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in interest rates. The Companyâs main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk.

Exposure to interest rate risk

The Companyâs interest rate risk arises mainly from the borrowings (including Cash Credit) from banks carrying floating rate of interest. These obligations expose the Company to cash flow interest rate risk. The exposure of the Companyâs borrowing to interest rate changes as reported to the management at the end of the reporting period along with the interest rate profile are as follows:

47. Capital management

For the purposes of the Companyâs capital management, capital includes issued equity share capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the management of the Companyâs capital structure is to maintain an efficient mix of debt and equity in order to achieve a low cost of capital. This also considers the desirable financial flexibility to pursue business opportunities and adequate access to liquidity to mitigate the effect of unforeseen events on cash flows.

The Company manages its capital structure and makes adjustments to it in light of changes in the economic/ business conditions and requirements.

52. Consequent to introduction of Goods and Services Tax (GST) with effect from July 1,2017, there has been ambiguity with regard to chargeability of indirect tax, i.e., UP VAT or GST or any other tax, on certain supplies made to a party and, therefore, no tax has been charged on invoices raised for such supplies. The Honâble Allahabad High Court in the year 2021-22 has held that no VAT is chargeable on such transactions. However, this issue is sub-judice before the Honâble Supreme Court in a similar matter. The buyer has provided an undertaking to indemnify the Company for any tax, along with interest, penalty (if levied) and any other related expenses, as may be finally determined in this regard.

The State VAT Authorities had completed assessments for the periods July 1,2017 to October 31,2020 and raised demands on the Company. These assessments have been cancelled after the Honâble Allahabad High Court order, except for the year ended March 31,2020, which is pending disposal before the VAT Tribunal, and the VAT demand raised amounting to Rs. 6,528.32 lakhs in respect of that year has been stayed by the Tribunal. The Company has deposited amounts aggregating Rs.3,417.52 lakhs under protest in respect of the aforesaid VAT matters for the periods July 1, 2017 to October 31, 2020.

During FY 2022-23, GST demands aggregating Rs. 29,617.47 lakhs were raised in relation to these transactions from July 1,2017 to September 30, 2022 (except for the financial year 2019-20) which have been stayed and are being contested. The Company has deposited amounts aggregating Rs.3,480.85 lakhs as of March 31, 2025 (Rs. 2,249.50 lakhs as at March 31,2024) as duty under protest in respect of GST, shown as âGovernment dues paid and recoverbleâ under âOther non-current assetsâ.

Further, GST Council in its meeting dated October 7, 2023 has ceded the right to tax such supplies to State Governments. However, State Government has not notified any rules in this regard as yet.

Pending necessary amendments / notifications in this regard, the Company has continued the same accounting treatment in respect of the transactions as in previous year(s) and the Company has recognized a provision for contingencies of Rs. 33,843.88 lakhs as at March 31, 2025 (Rs. 30,580.42 lakhs as at March 31, 2024) under âProvisions (current)â. Basis the undertaking from the buyer, the Company has recognized corresponding reimbursement assets amounting to Rs. 33,843.88 lakhs as at March 31,2025 (Rs. 30,580.42 lakhs as at March 31, 2024) under âOther financial assets (current)â.

The amounts aggregating Rs. 6,898.37 lakhs as at March 31,2025 (Rs.5,667.02 lakhs as at March 31,2024) paid under protest have been shown as recoverable under âOther non-current assetsâ with corresponding amount shown as payable to the buyer under âOther non-current financial liabilitiesâ.

The above does not have any impact on the statement of profit and loss of the Company.

54. The Board of Directors in the meeting held on 14 November, 2023 approved a Composite Scheme of Arrangement (âthe Schemeâ) between DCM Shriram Industries Limited and DCM Shriram Fine Chemicals Limited and DCM Shriram International Limited (wholly owned subsidiaries of DCM Shriram Industries Limited) and Lily Commercial Private Limited, for amalgamation of Lily Commercial Private Limited with DCM Shriram Industries Limited, and subsequent demerger of Chemical and Rayon businesses of DCM Shriram Industries Limited into DCM Shriram Fine Chemicals Limited and DCM Shriram International Limited, respectively, with effect from the appointed date of 1 April 2023, subject to regulatory and statutory approvals, as applicable. The Scheme has been cleared by BSE and NSE under listing regulations and has been filed for approval with Hon''ble NCLT, New Delhi on 23rd October, 2024 as required under section 230-232 of the Companies Act, 2013. Pending necessary approvals, the effect of the Scheme has not been given in the financial statements.

55. a) The Company has subscribed to 10,00,00,000 equity shares of Rs. 2 each in DCM Shriram Fine Chemcials Limited, a wholly owned subsidiary of the Company. Additional advance of Rs. 20.20 lakhs has been given during the year and, accordingly, an amount of Rs. 762.75 lakhs (March 31,2024: Rs. 742.55 lakhs) has been shown as âAdvance against share capitalâ and included in Note no. 5 âInvestment-Non currentâ.

b) The Company has subscribed to 50,000 equity shares of Rs. 2 each in DCM Shriram International Limited, a wholly owned subsidiary of the Company. Additional advance of Rs. 778.16 lakhs had been given during the year and, accordingly, an amount of Rs. 778.50 lakhs (March 31,2024: Rs. 0.34 lakhs) has been shown as âAdvance against share capitalâ and included in Note no. 5 âInvestment-Non currentâ.

During the year ended 31 March 2025, the Company completed the sale of building, which had been classified as a non-current asset held for sale as at 31 March 2024. The assets, had a carrying amount of Rs.33.87 lakhs at the time of classification. The asset was sold during the year for total proceeds of Rs.115.00 lakhs, resulting in a gain on disposal of Rs. 81.13 lakhs , which has been recognized under âOther incomeâ in the statement of profit or loss.

iv) The Company has not traded or invested in crypto currency or any virtual currency during the financial year.

v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vi) The Company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the Company shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vii) The Company does not have any transaction which is not recorded in the books of accounts that has been

surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such

as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

viii) The Company has not been declared as a wilful defaulter by any banks or any other financial institution at any time during the financial year or after the end of the reporting period but before the date when the financial statements are approved by the Board of Directors.

ix) The Group earlier had five Core Investment Companies (CICs) within the Group, out of which four have merged with the fifth CIC subsequent to receipt of NCLT order dated February 15, 2024 retrospectively from the appointed date, i.e., April 01,2023. Accordingly, the Group (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) has one CIC remaining as part of the Group.

Mar 31, 2024

d) Terms, rights, preferences and restrictions attached to equity shares

The Company has one class of equity shares having a par value of Rs. 2 per share. Each shareholder is eligible for one vote per share held. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the equity shares held by the shareholders. The Company declares and pays dividends in Indian Rupees. The dividend, if proposed by the Board of Directors, is subject to the approval of the shareholders in the Annual General Meeting, except in case of interim dividend.

* A Composite Scheme of Amalgamation for the merger of Versa Trading Private Limited, Bantam Enterprises Private Limited, Hi-Vac Wares Private Limited and HR Travels Private Limited into and with the Lily Commercial Private Limited with effect from 1 April 2023 (which is the appointed date under the scheme) has been approved by the NCLT.

g) Issue of shares for other than cash:

There were no buy back of shares, issue of shares by way of bonus shares or issue of shares pursuant to contract without payment being received in cash during the previous 5 years.

A. SECURED I. From Banks

a) Rs.271.21 lakhs (March 31,2023: Rs.1,356.04 lakhs) carrying interest of 5% p.a., repayable in 3 monthly instalments, is secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

b) Nil (March 31,2023: Rs.267.19 lakhs), Nil lakhs (March 31,2023: Rs.180.18 lakhs) and Rs.1,039.98 lakhs (March 31,2023: Rs.2,076.41 lakhs) carrying interest linked to lenderâs 1 year MCLR, repayable in 4 quarterly instalments, were/are secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

c) Rs.2,916.89 lakhs (March 31,2023: Rs.4,338.97 Lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 10 quarterly instalments, is secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

d) Rs.1,736.47 lakhs (March 31,2023: Rs.2,941.50 lakhs) carrying interest of 8% p.a., repayable in 18 monthly instalments, is secured by first pari-passu charge by way of mortgage/hypothecation on all the fixed assets of the Company, excluding assets on exclusive charges.

e) Nil (March 31,2023: Rs.333.26 lakhs) and Rs.156.25 (March 31,2023: Rs.781.25 lakhs) carrying interest rate of 8.95% p.a., repayable in 1 quarterly instalment, were/are secured by residual pari-passu charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

f) Rs.145.12 lakhs (March 31,2023: Rs.762.90 lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon with 50% interest subvention on part of the loan, repayable in 1 quarterly instalment, is secured by first pari-passu charge on fixed assets of Daurala Sugar Works - Sugar & Alcohol division, a unit of the Company.

g) Rs.900.00 lakhs (March 31,2023: Nil) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 20 quarterly instalments, is secured by first pari-passu charge on fixed assets of Daurala Sugar Works - Sugar & Alcohol division, a unit of the Company.

h) Rs.59.02 Lakhs (March 31,2023: Rs.71.87 lakhs) is secured by hypothecation of specific asset carrying interest of 8.50%, repayable in 45 monthly instalments.

II. From Others

i) Rs.346.15 lakhs (March 31,2023: Rs.445.05 lakhs) carrying interest linked to RBIâs Bank rate minus 2%., repayable in 7 half yearly instalments, is secured by first pari-passu charge on immovable and movable properties of sugar factory at Daurala Sugar Works, a unit of the Company.

ii) Rs.8.49 lakhs (March 31,2023: Rs.24.66 lakhs) is secured by hypothecation of specific asset carrying interest of 6.63%, repayable in 6 monthly instalments.

B. Unsecured

Rs.902.86 lakhs (March 31,2023: Rs.916.56 lakhs), deposits from public, carries interest between 9% p.a to 10% p.a., are currently repayable after 3 years from the date of acceptance of deposits.

C. The quarterly returns/statements filed by the Company with the banks are in agreement with the books of account of the Company.

The amount of Rs. 329.02 lakhs included in contract liabilities at March 31,2023 has been recognised as revenue during the year ended March 31, 2024 (March 31, 2023: Rs. 488.75 lakhs)

Revenue from sale of goods is recognised at the point in time when control of products is transferred to the customer. Amounts disclosed as revenue are net of returns and allowances, trade discounts and rebates.

Invoices are generated at that point in time. Invoices are usually payable within 180 days.

# The Company continues to pay income tax under the old tax regime and has not opted for lower tax rate pursuant to Taxation Law (Amendment) Ordinance, 2019 (Section 115BAA of The Income Tax Act, 1961) considering the accumulated MAT credit and other benefits under The Income Tax Act, 1961. The Company plans to opt for lower tax regime once these benefits are utilised, which is expected by financial year ending March 31, 2025. Accordingly, deferred tax liability on temporary differences which are expected to reverse after the financial year ending March 31, 2025 has been remeasured considering the revised rate.

In accordance with Ind AS 108 ''Segment Reporting'' as specified in section 133 of the Companies Act, 2013, the Company has identified three business segments viz. ''Sugar'', ''Industrial fibres and related products'', and ''Chemicals''. The above segments have been identified and reported taking into account the differing risks and returns, and the current internal financial reporting systems. For each of the segments, the Chief Operating Decision Maker (CODM) reviews internal management reports on at least a quarterly basis. The CODM monitors the operating results separately for the purpose of making decisions about resource allocation and performance measurement (Refer Note 2A(p)). Segment revenue, results and capital employed include the respective amounts identifiable to each of the segments. Other unallocable expenditure includes expenses incurred on common services provided to the segments, which are not directly identifiable.

In addition to the material accounting policies applicable to the business segments as set out in note 2A(p) above, the accounting policies in relation to segment accounting are as under:

a) Segment revenue and expenses

Segment revenue and expenses are, generally, directly attributable to the segments. Joint revenue and expenses of segments are allocated amongst them on a reasonable basis.

b) Segment assets and liabilities

The following summary describes the operations in each of the Company''s reportable segments:

Sugar Comprising sugar, power and alcohol

Industrial fibres and related products Comprising rayon, synthetic yarn, cord, fabric, etc.

Chemicals Comprising organics and fine chemicals

B. Commitments

a. Capital commitments: Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amount aggregating to Rs. 250.92 lakhs (March 31,2023: Rs. 99.42 lakhs) relating to Property, plant and equipment.

A. Defined contribution plans

Rs. 201.03 lakhs (March 31,2023: Rs. 180.88 lakhs) for provident fund contributions and Rs. 254.02 lakhs (March 31,2023: Rs. 247.35 lakhs) for superannuation and national pension scheme fund contributions have been charged to the Statement of Profit and Loss. The contributions towards these schemes are at the rates specified in the rules of the schemes.

B. Defined benefit plans

Gratuity:

Expected contributions to post-employment benefit plans for the financial year 2024-25 are Rs. 230.42 lakhs (202324: Rs. 221.81 lakhs).

vii) Sensitivity analysis

The significant actuarial assumptions for the determination of defined benefit obligations are discount rate and expected salary increase.

C. Compensated absences:

The obligation of compensated absence in respect of the employees of the Company as at March 31, 2024 works out to Rs. 1,447.55 lakhs (March 31,2023: Rs. 1,269.86 lakhs)

D. Provident fund:

All employees are entitled to Provident Fund benefits as per the law. For certain category of employees the Company administers the benefits through a recognised Provident Fund Trust. The Company has an obligation to fund any shortfall on the yield of the trust''s investments over the administered interest rates on an annual basis. For other employees contributions are made to the Regional Provident Fund Commissioners. The Government mandates the annual yield to be provided to the employees on their corpus. This plan is considered as a Defined Benefit Plan. For the first category of employees (covered by the Trust), the Company has an obligation to make good the shortfall, if any, between the yield on the investments of the trust and the yield mandated by the Government and these are considered as Defined Benefit Plans and are accounted for on the basis of an actuarial valuation.

Expected contribution to provident fund benefit plans for the financial year 2024-25 are Rs.669.14 lakhs

vi) Sensitivity analysis

The significant actuarial assumption for the determination of defined benefit obligations is the discount rate.

Sensitivities due to mortality and withdrawals are insignificant and hence not considered in sensitivity analysis disclosed.

E. Risk exposure

These defined benefit plans typically expose the Company to actuarial risks as under:

a) Investment Risk

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

b) Interest rate risk

A decrease in bond interest rate will increase the plan liability. However, this shall be partially off-set by increase in return as per debt investments.

c) Longevity risk

d) Salary risk

Higher than expected increase in salary will increase the defined benefit obligation.

Transactions with the related parties are made on normal commercial terms and conditions and at market rates, to be settled in cash except advance for share capital (refer note 55)

46. Financial instruments - Fair values and risk management

a. Financial instruments - by category and fair values hierarchy

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The following table shows the carrying amounts and fair value of financial assets and financial liabilities, including their levels in the fair value hierarchy.

* The carrying amounts of trade receivables, trade payables, lease liabilites, cash and cash equivalents, investments, bank balances other than cash and cash equivalents, and other financial assets and liabilities, approximate the fair values, due to their short-term nature. The other non-current financial assets represents security deposits given to various parties, loans and advances to employees and bank deposits (due for maturity after twelve months from the reporting date), lease liabilities and other non-current financial liabilities, the carrying values of which approximate the fair values as on the reporting date.

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended March 31,2024 and March 31,2023.

Valuation

Following financial instruments are remeasured at fair value as under :

(b) The fair value of all derivative contracts is determined using forward exchange rate at the balance sheet date.

Cash and cash equivalents

Credit risk on cash and cash equivalents is limited as the Company generally transacts with the banks with high credit ratings assigned by domestic and international credit rating agencies.

Other financial assets

Other financial assets do not have any significant credit risk (also refer note 52).

(ii) Liquidity risk

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of Rs. 3,062.66 as at March 31,2024 (March 31,2023 Rs. 1,223.46 lakhs), anticipated future considering internally generated funds from operations fully available and revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if liquidity needs were to arise, the Company believes it has access to financing arrangements, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements, as necessary.

The Companyâs liquidity management process as monitored by management, includes the following:

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Companyâs liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

(iii) Market risk

Currency risk

Sensitivity analysis

A reasonably possible strengthening / weakening of the Indian Rupee against below currencies at March 31, 2024 (previous year ended as on March 31, 2023) would have affected the measurement of financial instruments denominated in functional currency and affected equity and profit or loss by the amounts shown below. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

Foreign exchange derivative contracts

(iii) Market risk

Interest rate risk

47. Capital management

The Company manages its capital structure and makes adjustments to it in light of changes in the economic/ business conditions and requirements.

48. Research and development expenses amounting to Rs. 617.10 lakhs (March 31,2023: Rs. 491.48 lakhs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. Nil (March 31, 2023: Rs. 8.25 lakhs) has been included in property, plant and equipment.

The State VAT Authorities had completed assessments for the periods July 1,2017 to October 31, 2020 and raised demands on the Company. These assessments have been cancelled after the Honâble Allahabad High Court order, except for the year ended March 31,2020, which is pending disposal before the VAT Tribunal, and the VAT demand raised amounting to Rs. 6,528.32 lakhs in respect of that year has been stayed by the Tribunal. The Company has deposited amounts aggregating Rs.3,417.52 lakhs under protest in respect of the aforesaid VAT matters for the periods July 1, 2017 to October 31, 2020.

During the previous year, GST demands aggregating Rs. 29,617.47 lakhs were raised in relation to these transactions from July 1,2017 to September 30, 2022 (except for the financial year 2019-20) which have been stayed and are being contested. The Company has deposited amounts aggregating Rs.2,249.50 lakhs as of March 31, 2024 (Rs. 1,891.66 lakhs as at March 31,2023) as duty under protest in respect of GST, shown as âGovernment dues paid and recoverbleâ under âOther non-current assetsâ.

Further, GST Council in its meeting dated October 7, 2023 has ceded the right to tax such supplies to State Governments. However, State Government has not notified any rules in this regard as yet.

Pending necessary amendments / notifications in this regard, the Company has continued the same accounting treatment in respect of the transactions as in previous year(s) and the Company has recognized a provision for contingencies of Rs. 30,580.42 lakhs as at March 31, 2024 (Rs. 26,312.70 lakhs as at March 31, 2023) under Provisions (current). Basis the undertaking from the buyer, the Company has recognized corresponding reimbursement assets amounting to Rs. 30,580.42 lakhs as at March 31, 2024 (Rs. 26,312.70 lakhs as at March 31,2023) under âOther financial assets (current)â.

The amounts aggregating Rs. 5,667.02 lakhs as at March 31,2024 (Rs.5,309.18 lakhs as at March 31,2023) paid under protest have been shown as recoverable under âOther non-current assetsâ with corresponding amount shown as payable to the buyer under âOther non-current financial liabilitiesâ.

The above does not have any impact on the profits of the Company.

54. The Board of Directors in the meeting held on 14 November, 2023 approved a Composite Scheme of Arrangement (the Scheme) between DCM Shriram Industries Limited and DCM Shriram Fine Chemicals Limited and DCM Shriram International Limited (wholly owned subsidiaries of DCM Shriram Industries Limited) and Lily Commercial Private Limited, for amalgamation of Lily Commercial Private Limited with DCM Shriram Industries Limited, and subsequent demerger of Chemical and Rayon businesses of DCM Shriram Industries Limited into DCM Shriram Fine Chemicals Limited and DCM Shriram International Limited, respectively, with effect from the appointed date of 1 April 2023, subject to regulatory and statutory approvals, as applicable. The Scheme is presently under consideration of Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). Pending the necessary approvals, which are substantive in nature, the effect of the Scheme has not been given in the financial statements.

55. a) During the previous year, the Company subscribed to 10,00,00,000 equity shares of Rs. 2 each in DCM Shriram Fine Chemcials Limited, a wholly owned subsidiary of the Company, including conversion of advance against equity Rs. 1,670.64 lakhs as on March 31,2022. Additional advance of Rs. 411.27 lakhs has been given during the year and, accordingly, an amount of Rs. 742.55 lakhs (March 31,2023: Rs. 331.27 lakhs) has been shown as âAdvance against share capitalâ and included in Note no. 5 âInvestment-Non currentâ.

b) During the previous year, the Company subscribed to 50,000 equity shares of Rs. 2 each in DCM Shriram International Limited, a wholly owned subsidiary of the Company. Additional advance of Rs. 0.34 lakhs had been given during the previous year and, accordingly, an amount of Rs. 0.34 lakhs (March 31, 2023: Rs. 0.34 lakhs) has been shown as âAdvance against share capitalâ and included in Note no. 5 âInvestment-Non currentâ.

iv) The Company has not traded or invested in crypto currency or any virtual currency during the financial year.

v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.â

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vii) The Company does not have any transaction which is not recorded in the books of accounts that has been

surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such

as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

ix) The Group earlier had five Core Investment Companies (CICs) within the Group, out of which four have merged with the fifth CIC subsequent to receipt of NCLT order retrospectively from the appointed date, i.e., April 01,2023. Accordingly, the Group (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) has one CIC remaining as part of the Group.

Mar 31, 2023

k) Provisions and contingent liabilities

Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

Provisions are measured at managementâs best estimate of the expenditure required to settle the present obligation at the end of the reporting period. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost.

A provision for onerous contract is recognised when the expected benefits to be derived by the Company from a contract are lower than the unavoidable cost of meeting its obligation under the contract. The provision is measured at the present value of the lower of the expected cost of terminating the contract and the expected net cost of continuing with the contract. Before a provision is established, the Company recognises any impairment loss on assets associated.

Contingent liabilities are possible obligations that arise from past events and whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events not wholly within the control of the Company. Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote.

The Company does not recognise a contingent liability but discloses its existence in the financial statements. Contingent assets are neither recognised nor disclosed in the financial statements. However, contingent assets are assessed continually and if it is virtually certain that an inflow of economic benefits will arise, the asset and related income are recognised in the period in which the change occurs.

l) Borrowing cost

Borrowing costs that are directly attributable to the acquisition, construction or erection of qualifying assets are capitalised as part of cost of such asset until such time that the assets are substantially ready for their intended use. Qualifying assets are assets which take a substantial period of time to get ready for their intended use or sale.

When the Company borrows funds specifically for the purpose of obtaining a qualifying asset, the borrowing costs incurred are capitalized. When Company borrows funds generally and uses them for the purpose of obtaining a qualifying asset, the capitalization of the borrowing costs is computed based on the weighted average cost of general borrowing that are outstanding during the period and used for the acquisition of the qualifying asset.

Capitalisation of borrowing costs ceases when substantially all the activities necessary to prepare the qualifying assets for their intended uses are complete. Borrowing costs consist of interest and other costs that an entity incurs in connection with the borrowing of funds. Borrowing costs include exchange differences arising from foreign currency borrowings to the extent that they are regarded as an adjustment to interest costs.

All other borrowing costs are recognised as an expense in the year in which they are incurred.

m) Leases Company as a lessee

The Company recognizes a Right-of Use (RoU) asset at cost and corresponding lease liability, except for leases with term of less than twelve months (short term) and low-value assets in accordance with Ind AS 116 âLeasesâ. The Company assesses whether a contract contains a lease, at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess whether a contract conveys the right to control the use of an identified asset, the Company assesses whether:

a. the contract involves the use of an identified asset

b. the Company has substantially all of the economic benefits from use of the asset through the period of the lease and the Company has the right to direct the use of the asset.

The cost of the right-of-use assets comprises the amount of the initial measurement of the lease liability, any lease payments made at or before the inception date of the lease plus any initial direct costs etc. Subsequently, the right-of-use asset is measured at cost less any accumulated depreciation and accumulated impairment losses, if any. The right-of-use asset is depreciated using the straight-line method from the commencement date over the shorter of lease term or useful life of right-of-use assets. The estimated useful life of the right-of-use assets are determined on the same basis as those of property, plant and equipment. Right of use assets are evaluated for recoverability whenever events or changes in circumstances indicate that their carrying amounts may not be recoverable. For the purpose of impairment testing, the recoverable amount (i.e. the higher of the fair value less cost to sell and the value-in-use) is determined on an individual asset

basis unless the asset does not generate cash flows that are largely independent of those from other assets. In such cases, the recoverable amount is determined for the Cash Generating Unit (CGU) to which the asset belongs. For lease liabilities at the commencement date, the Company measures the lease liability at the present value of the lease payments that are not paid at that date. The lease payments are discounted using the interest rate implicit in the lease, if that rate is readily determined, if that rate is not readily determined, the lease payments are discounted using the incremental borrowing rate. For short-term and low value leases, the Company recognizes the lease payments as an operating expense on a straight-line basis over the lease term. The carrying amount of lease liabilities is remeasured if there is a modification, a change in the lease term, a change in the lease payments or a change in the assessment of an option to purchase the underlying asset. Certain lease arrangements include the options to extend or terminate the lease before the end of the lease term. ROU assets and lease liabilities includes these options when it is reasonably certain that they will be exercised. The Company has used a single discount rate to a portfolio of leases with similar characteristics.

Company as a lessor

At the inception of the lease the Company classifies each of its leases as either an operating lease or a finance lease. The Company recognises lease income as and when due as per terms of agreements. The respective leased assets are included in the financial statements based on their nature. The Company did not need to make any adjustments to the accounting for assets held as lessor as a result of adopting the new leasing standard.

n) Earnings per share (EPS)

Basic earnings / (loss) per share are calculated by dividing the net profit or loss for the year attributable to the shareholders of the Company by the weighted average number of equity shares outstanding at the end of the reporting period. The weighted average number of equity shares outstanding during the year is adjusted for events of bonus / rights issue, if any, that have changed the number of equity shares outstanding, without a corresponding change in resources.

For the purpose of calculating diluted earning per share, the net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the period are adjusted for the effects of all dilutive potential equity shares.

o) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM).

In accordance with Ind AS 108 - âOperating Segmentsâ, the operating segments used to present segment information are identified on the basis of internal reports used by the Companyâs Management to allocate resources to the segments and assess their performance.

The Executive Committee, comprising Chairman and Managing Director, Whole Time Directors, Business Heads, Chief Financial Officer and Company Secretary is collectively the Companyâs âChief Operating Decision Makerâ or âCODMâ within the meaning of Ind AS 108. All operating segmentsâ operating results are reviewed regularly by the CODM to make decisions about resources to be allocated to the segments and assess their performance. Refer Note 39 for segment information.

Based on âManagement Approachâ as defined in Ind AS 108 -Operating Segments, the Chief Operating Decision Maker evaluates the Companyâs performance and allocates the resources based on an analysis of various performance indicators by business segments. Inter segment sales and transfers are reflected at market prices.

Unallocable items includes general corporate income and expense items which are not allocated to any business segment.

Segment policies:

The Company prepares its segment information in conformity with the accounting policies adopted for preparing and presenting the standalone financial statements of the Company as a whole. Common allocable costs are allocated to each segment on an appropriate basis.

p) Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The Company has an established control framework with respect to the measurement of fair values. It regularly reviews significant inputs and valuation adjustments.

When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Company recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

Further information about the assumptions made in measuring fair values used in preparing these financial statements is included in the respective notes.

Initial recognition and measurement

With the exception of trade receivables that do not contain a significant financing component, the Company initially measures financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, net of transaction costs. Trade receivables do not contain a significant financing component and are measured at the transaction price determined under Ind AS 115. Refer to the accounting policies in section 2A (e) Revenue recognition.

Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e., the date that the Company commits to purchase or sell the asset.

Subsequent measurement

For purposes of subsequent measurement, financial assets of the Company are classified in three categories:

a) At amortised cost

b) At fair value through profit and loss (FVTPL)

c) At fair value through other comprehensive income (FVTOCI)

Financial Asset is measured at amortised cost if both the following conditions are met:

a) The asset is held within a business model whose objective is to hold assets for collecting contractual cash flows, and

b) Contractual terms of the asset give rise on specified dates to cash flows that are solely payments of principal and interest (SPPI) on the principal amount outstanding.

After initial measurement, such financial assets are subsequently measured at amortised cost using the effective interest rate (EIR) method. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included in other income in the Statement of Profit and Loss. The losses arising from impairment are recognised in the Statement of Profit and Loss. This category generally applies to trade and other receivables.

All financial assets not classified as measured at amortised cost or FVTOCI are measured at FVTPL. This includes all derivative financial assets and current investments in mutual funds. On initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortised cost or at FVTOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.

Equity investments

All equity investments in the scope of Ind AS 109 are measured at fair value. Equity instruments which are held for trading are measured at fair value through profit and loss.

For all other equity instruments, the Company may make an irrevocable election to present subsequent changes in the fair value in other comprehensive income. The Company makes such election on an instrument by instrument basis. The classification is made on initial recognition and is irrevocable.

If the Company decides to classify an equity instrument as at FVTOCI, then all fair value changes on the instrument, excluding dividends, are recognised in other comprehensive income. This cumulative gain or loss is not reclassified to Statement of Profit and Loss on disposal of such instruments.

Investments representing equity interest in subsidiary and associate are carried at cost less any provision for impairment.

Impairment of financial assets

The Company recognizes loss allowances for expected credit losses on:

- Financial assets measured at amortized cost; and

- Financial assets measured at FVTOCI - debt instruments.

Loss allowance for trade receivables is measured at an amount equal to lifetime ECL. For all financial assets with contractual cash flows other than trade receivable, ECLs are measured at an amount equal to the 12-month ECL, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECL. The amount of ECLs (or reversal) that is required to adjust the loss allowance at the reporting date to the amount that is recognised as an impairment gain or loss in the Statement of Profit and Loss.

At each reporting date, the Company assesses whether financial assets carried at amortized cost and debt instruments at FVTOCI are credit-impaired. A financial asset is âcredit-impairedâ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred.

Financial liabilities

Financial liabilities are classified as measured at amortized cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for- trading, or it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognized in the Statement of Profit and Loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in the Statement of Profit and Loss. Any gain or loss on derecognition is also recognised in the Statement of Profit and Loss.

Offsetting

Financial assets and financial liabilities are offset and the net amount is presented in the Balance Sheet when, and only when, the Company currently has a legally enforceable right to set off the

amounts and it intends either to settle them on a net basis or to realise the assets and settle the liabilities simultaneously.

Derecognition

(i) Financial assets

The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and does not retain control of the financial asset.

If the Company enters into transactions whereby it transfers assets recognised on its Balance Sheet, but retains either all or substantially all of the risks and rewards of the transferred assets, the transferred assets are not derecognised.

(ii) Financial liabilities

The Company derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also derecognises a financial liability when its terms are modified and the cash flows under the modified terms are substantially different. In this case, a new financial liability based on the modified terms is recognised at fair value. The difference between the carrying amount of the financial liability extinguished and the new financial liability with modified terms is recognised in the Statement of Profit and Loss.

q) Cash and cash equivalents

For the purpose of presentation in the Statement of Cash Flows, cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the Balance Sheet.

r) Research and development

Expenditure on research and development activities is recognized in the Statement of Profit and Loss as incurred.

Development expenditure is capitalized as part of cost of the resulting intangible asset only if the expenditure can be measured reliably, the product or process is technically and commercially feasible, future economic benefits are probable, and the Company intends to and has sufficient resources to complete development and to use or sell the asset. Otherwise, it is recognized in profit or loss as incurred. Subsequent to initial recognition, the asset is measured at cost less accumulated amortisation and any accumulated impairment losses, if any.

s) Dividend

The Company recognises a liability to make cash distributions to equity holders when the distribution is authorised and the distribution is no longer at the discretion of the Company. As per the corporate laws in India, a distribution is authorised when it is approved by the shareholders. A corresponding amount is recognised directly in equity.

t) Goods and services tax input credit

Goods and services tax input credit is recognised in the books of account in the period in which the supply of goods or service received is recognised and when there is no uncertainty in availing/ utilising the credits.

Expenses and assets are recognised net of the goods and services tax/value added taxes paid, except:

1. When the tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the tax paid is recognised as part of the cost of acquisition of the asset or as part of the expense item, as applicable.

2. When receivables and payables are stated with the amount of tax included, the net amount of tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the Balance Sheet.

u) Assets held for sale

Non current assets or disposal groups are classified as held for sale if their carrying amount is intended to be recovered principally through sale rather than through continuing use. The condition for classification of held for sale is met when the non current asset or the disposal group is available for immediate sale and the same is highly probable of being completed within one year from the date of classification as held for sale. Non current assets or disposal groups held for sale are measured at the lower of carrying amount and fair value less cost to sell.

A gain or loss of the non-current asset is recognised at the date of de-recognition. Once classified as held-for-sale, property, plant and equipment are no longer amortised or depreciated.

2A. Recent Accounting Pronouncements

Ministry of Corporate Affairs (âMCAâ) notifies new standard or amendments to the existing standards under Companies (Indian Accounting Standards) Rules as issued from time to time. On March 31,2023, MCA amended the Companies (Indian Accounting Standards) Rules, 2015 by issuing the Companies (Indian Accounting Standards) Amendment Rules, 2023, applicable from April 1,2023, as below:

Ind AS 1 - Presentation of Financial Statements

The amendments require companies to disclose their material accounting policies rather than their significant accounting policies. Accounting policy information, together with other information, is material when it can reasonably be expected to influence decisions of primary users of general purpose financial statements. The Company does not expect this amendment to have any significant impact in its financial statements.

Ind AS 12 - Income Taxes

The amendments clarify how companies account for deferred tax on transactions such as leases and decommissioning obligations. The amendments narrowed the scope of the recognition exemption in paragraphs 15 and 24 of Ind AS 12 (recognition exemption) so that it no longer applies to transactions that, on initial recognition, give rise to equal taxable and deductible temporary differences. The Company does not expect this amendment to have any significant impact in its financial statements.

Ind AS 8 - Accounting Policies, Changes in Accounting Estimates and Errors

The amendments will help entities to distinguish between accounting policies and accounting estimates. The definition of a change in accounting estimates has been replaced with a definition of accounting estimates. Under the new definition, accounting estimates are âmonetary amounts in financial statements that are subject to measurement uncertaintyâ. Entities develop accounting estimates if accounting policies require items in financial statements to be measured in a way that involves measurement uncertainty. The Company does not expect this amendment to have any significant impact in its financial statements.

A. SECURED LOANS I. From Banks

a) Nil (March 31,2022: Rs.156.25 lakhs) and Nil (March 31,2022: Rs.66.50 lakhs) were carrying interest linked to 1 year MCLR and secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company and assets on exclusive charges.

b) Nil (March 31,2022: Rs.104.07 lakhs) was carrying interest linked to 1 year MCLR and secured by first exclusive charge on specific movable assets of Sugar division of Daurala Sugar Works, a unit of the Company.

c) Rs.1,356.04 lakhs (March 31,2022: Rs.2,440.87 lakhs) carrying interest of 5% p.a., repayable in 15 monthly instalments, is secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

d) Rs.267.19 lakhs (March 31,2022: Rs.531.77 lakhs), Rs.180.18 lakhs (March 31,2022: Rs.368.08 lakhs) and Rs.2,076.41 lakhs (March 31,2022: Rs.3,108.77 lakhs) carrying interest linked to lenderâs 1 year MCLR, repayable in 4, 4 and 8 quarterly instalments respectively, are secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

e) Rs.4,338.97 Lakhs (March 31,2022: Rs.3,922.18 Lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon, repayable in 14 quarterly instalments, is secured by first pari-passu charge on all the immovable and movable properties of the Company excluding assets on exclusive charges.

f) Rs.2,941.50 lakhs (March 31,2022: Rs.4,002.76 lakhs) carrying interest of 8% p.a., repayable in 36 monthly instalments, is secured by first pari-passu charge by way of mortgage/hypothecation on all the Fixed Assets of the Company excluding assets on exclusive charges.

g) Rs.333.26 lakhs (March 31,2022: Rs.1,666.62 lakhs) and Rs.781.25 lakhs (March 31,2022: Rs.1,406.25 lakhs) carrying interest rate of 8.95% p.a., repayable in 1 and 5 quarterly instalments respectively, are secured by residual pari-passu charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

h) Rs.762.90 lakhs (March 31,2022: Rs.1,370.20 lakhs) carrying interest linked to lenderâs 1 year MCLR and spread thereon with 50% interest subvention on part of the loan, repayable in 5 quarterly instalments, is secured by first charge on specific movable assets of Distillery division of Daurala Sugar Works, a unit of the Company.

i) Rs.71.87 Lakhs (March 31,2022: Nil) is secured by hypothecation of specific asset carrying interest of 8.50%, repayable in 57 monthly instalments.

II. From Others

a) Rs.445.05 lakhs (March 31,2022: Rs.494.50 lakhs) and Nil (March 31,2022: Rs.28.44 lakhs) carrying interest linked to RBIâs Bank rate minus 2%., repayable in 9 half yearly instalments, is/ was secured by first pari-passu charge on immovable and movable properties of sugar factory at Daurala Sugar Works, a unit of the Company.

b) Rs.24.66 lakhs (March 31,2022: Rs.39.80 lakhs) is secured by hypothecation of specific asset carrying interest of 6.63%, repayable in 18 monthly instalments.

B. UNSECURED LOANS

Rs.916.56 lakhs (March 31,2022: Rs.940.07 lakhs), Deposits from public, carries interest between

9.5% p.a to 10.50% p.a., are currently repayable after 3 years from the date of acceptance of

deposits.

C. The quarterly returns/statements filed by the Company with the banks are in agreement with the books of accounts of the Company.

In accordance with the requirements of Ind AS 24 on Related Party Disclosures, the names of the related parties where control exists and/or with whom transactions have taken place during the year and description of relationships, as identified and certified by the management are:

A. Names of related parties and nature of related party relationship Subsidiary

Daurala Foods and Beverages Private Limited

DCM Shriram Fine Chemicals Limited (w.e.f. 29.09.2021)

DCM Shriram International Limited (w.e.f. 07.09.2022)

Associate

DCM Hyundai Limited

Key management personnel

Mr. S. B. Mathur, Chairman Mr. Alok B. Shriram, Senior Managing Director Mr. Madhav B. Shriram, Managing Director Ms. Urvashi Tilakdhar, Director

Mr. Vineet Manaktala, Director & CFO ( w.e.f. 01.07.2021)

Mr. N. K.Jain, Director & CFO (upto 30.06.2021)

Mr. P. R. Khanna, Independent Director

Mr. Ravinder Narain, Independent Director

Mr. S. C. Kumar, Independent Director

Ms. V. Kavitha Dutt, Independent Director

Mr. Sanjay C. Kirloskar, Independent Director

Mr. Y. D. Gupta, Vice President & Company Secretary

Mr. Mukesh Gupta, Nominee Director (upto 14.03.2022)

Ms. Mini Ipe , LIC Nominee Director (w.e.f. 30.03.2022)

Mr. Manoj Kumar, Non-executive Director

Relatives/HUF of key management personnel

Mr. Akshay Dhar Ms. Kanika Shriram Mr. Rudra Shriram Mr. Rohan Shriram Mr. Uday Shriram Ms. Umika Shriram Ms. Kislaya Rakesh Ms. Anita Gupta Ms. Manju Jain Ms. Kiran Khanna Mr. P. R. Khanna (HUF)

M/s. Lala Bansi Dhar & Sons- HUF

Ms. Suman Bansi Dhar

Ms. Divya Shriram

Ms. Karuna Shriram

Ms. Aditi Dhar

Ms. K. Rao

Ms. Amita Manaktala

Ms. Astha Manaktala

Mr. Mohit Manaktala

Trusts

Employees'' Provident Fund Trust, DCM Shriram Industries Limited Daurala Organics Limited Employees'' Provident Fund Trust DCM Shriram Industries Limited Superannuation Trust DCM Shriram Industries Limited Employees'' Gratuity Fund

Others (Enterprises over which key management personnel or their relatives are able to exercise significant influence)

Bantam Enterprises Private Limited H.R. Travels Private Limited

DCM Containers & Engineering Private Limited (w.e.f. 23.06.21)

(Formerly Hindustan Vaccum Glass Private Limited)

Kirloskar Corrocoat Private Limited

Lily Commercial Private Limited

Hi-Vac Wares Private Limited

Fives Cail - KCP Limited

Versa Trading Limited

Absolut Info Systems Private Limited

52. Consequent to introduction of GST with effect from July 1, 2017, there has been ambiguity with regard to chargeability of indirect tax, i.e. UP VAT or GST or any other tax, on certain supplies made to a party and, therefore, no tax has been charged on invoices raised for such supplies. The Hon''ble Allahabad High Court has held that no VAT is chargeable on such transactions. However, this issue is sub-judice before the Hon''ble Supreme Court in a similar matter. The buyer has provided an undertaking to indemnify the Company for any tax, along with interest, penalty (if levied) or any other related expenses, as may be finally incurred in this regard.

State VAT Authorities had completed assessments for the period July 1, 2017 to October 31,2020 and raised demands. These assessments have been cancelled after Honâble Allahabad High Court order except for the year ended March 31, 2020 which is pending disposal before VAT Tribunal and VAT demand raised amounting to Rs 6,911.32 lakhs in respect of that year has been stayed by the tribunal. The Company has deposited an amount of Rs.3,417.52 lakhs under protest in respect of the aforesaid VAT matters for the period July 1,2017 to October 31,2020.

During the year, GST demand of Rs. 29,617.47 lakhs was raised on these transactions from July 1,2017 to September 30, 2022 (except FY 2019-20) which is stayed and contested. The Company has deposited an amount of Rs. 1,891.66 lakhs as duty under protest in respect of GST.

Pending clarity on imposition of VAT or GST on such supplies, the Company has recognized a provision for contingencies under "Provisions (current)" of Rs. 26,312.70 lakhs as at March 31,2023 (Rs 15,733.25 lakhs as at March 31,2022, net of amount paid under protest of Rs.3,417.52 lakhs). Basis the undertaking from the buyer, the Company has recognized corresponding reimbursement assets amounting to Rs. 26,312.70 lakhs as at March 31,2023 (Rs. 15,550.43 lakhs as at March 31,2022, net of amount already received Rs.3,600.34 lakhs) under "Other financial assets (current)".

The amounts aggregating to Rs.5,309.18 lakhs paid under protest have been shown as recoverable under "Other noncurrent assets". As these have been funded by the buyer similar amount is shown as payable to the buyer under "Other non-current financial liabilities".

The above does not have any impact on the profit of the Company.

54. During the previous year ended March 31, 2022, 7,00,000 5% Redeemable Non-Cumulative Preference Shares of Rs. 100 each in Versa Trading Limited aggregating to Rs. 700 Lakhs, which were fully impaired in an earlier year, were sold for Rs. 490 Lakhs. Consequently, to that extent, provision for impairment was reversed and included in "Provisions/Liabilities no longer required, written back" in Note 30 "Other Income".

55. a) During the year, the Company subscribed to 9,99,50,000 equity shares of Rs. 2 each in DCM Shriram Fine Chemcials Limited, a wholly owned subsidiary of the Company, including conversion of advance against equity Rs.1,670.64 lakhs as on March 31, 2022. Additional advance of Rs. 659.63 lakhs has been given during the year and accordingly an amount of Rs. 331.27 lakhs (March 31,2022: Rs. 1,670.64 lakhs) has been shown as "Advance against share capital" and included in Note no. 5 "Investment-Non current".

b) During the year, the Company subscribed to 50,000 equity shares of Rs. 2 each in DCM Shriram International Limited, a wholly owned subsidiary of the Company. Additional advance of Rs. 0.34 lakhs has been given during the year and accordingly an amount of Rs. 0.34 lakhs (March 31,2022: Rs. Nil) has been shown as "Advance against share capital" and included in Note no. 5 "Investment-Non current".

iv) The Company has not traded or invested in crypto currency or virtual currency during the financial year.

v) The Company has not advanced or loaned or invested funds to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

a) directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the funding party (ultimate beneficiaries) or

b) provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.

vii) The Company does not have any transaction which is not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

ix) The Group (as per the provisions of the Core Investment Companies (Reserve Bank) Directions, 2016) has five CICs as part of the Group.

60. The figures of the previous year/periods have been regrouped/reclassified wherever necessary to comply with amendments in Schedule III of the Companies Act, 2013.

As per our report of even date attached For and on behalf of the Board of Directors DCM Shriram Industries Limited

^F0^rBSRh^&a^CÂ°'' ^LLP * Vineet Manaktala S.B Mathur

Charted A^ccountants Director Finance & Chief Financial Officer Chairman

^{ICAI Firm Registration N}Â°.: DIN: 09145644 DIN: 00013239

101248W/W-100022

Alok B. Shriram

Kaushal Kishore Ma^ng^"

Partner ^{DIN: 00203808} DIN: 00203521

Membership No.: 090075 ^Y.^D. ^Gupt.^a1 _ _

Vice President & Company Secretary Urvashi Tilakdhar

Place : New Delhi Place : New Delhi Wholetime Director

Date : May 25, 2023 Date : May 25, 2023 DIN: 00294265

Mar 31, 2018

1. Corporate Information

DCM Shriram Industries Limited (the âCompanyâ) is a Public Limited Listed Company incorporated in India and having its registered office at Kanchenjunga Building, 6th Floor, 18, Barakhamba Road, New Delhi - 110001. The Company is primarily engaged in production and sale of sugar, alcohol, power, chemicals and industrial fibers.

2 Basis of preparation of financial statements

a) Statement of Compliance

These Standalone Ind AS Financial Statements (âStandalone Financial Statementsâ) of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) as per the Companies (Indian Accounting Standards) Rules, 2015 notified under section 133 of Companies Act, 2013, (the âActâ), Companies (Indian Accounting Standards) (Amendment) Rules, 2016 and other relevant provisions of the Act, as applicable.

For all the periods up to and including March 31, 2017, these Standalone Financial Statements were prepared in accordance with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 and other relevant provisions of the Act (âPrevious GAAPâ). As these Standalone Financial Statements for the year ended March 31, 2018 are the Companyâs first standalone financial statements prepared in accordance with Ind AS, Ind AS 101, First time adoption of Indian Accounting standards has been applied. An explanation of how the transition to Ind AS has effected the previously reported financial position, financial performance and cash flows of the Company is provided in Note 48.

These Standalone Financial Statements of the Company for the year ended March 31, 2018 are approved by the Companyâs Audit Committee and by the Board of Directors on May 29, 2018.

b) Functional and presentation currency

These standalone financial statements are presented in Indian Rupees (INR), which is also the Companyâs functional currency. All amounts are in rupees lakhs with two decimel points rounded off to the nearest thousands, unless otherwise stated.

c) Basis of measurement

The standalone financial statements have been prepared on a historical cost basis, except for the following items:

d) Critical accounting estimates and judgements

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised prospectively. In particular, information about significant areas of estimation/ uncertainty and judgements in applying accounting policies that have the most significant effects on the standalone financial statements are included in the following notes:

- Recognition and estimation of tax expense including deferred tax- Note 38.

- Assessment of useful life of property, plant and equipment and intangible asset- Note 2A(b) & (c).

- Estimation of obligations relating to employee benefits: key actuarial assumptions- Note 2A(g)

- Valuation of Inventories- Note 2A(d)

- Fair Value Measurement of financials instruments - Note 2A(p)

- Lease Classification- Note 2A(m)

- Recognition and Measurement of provisions and contingencies: key assumptions about the likelihood and magnitude of outflow of resources- Note 2A(k)

- Impairment of Financial Assets- Note 2A(p)

- Impairment of Non-financial Assets- Note 2A(j)

d) Terms, rights, preferences and restrictions attached to equity shares

The Company has one class of equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share held.

Nature and purpose of reserve

a. Amalgamation reserve

Amalgation reserve has been created on amalgamation of Daurala Organics Limited with the Company.

b. General reserve

Profits earned by the company are transferred to General reserve as decided.

c. Capital redemption reserve

Created on redemption of preference shares as per requirements of the Companies Act, 1956.

d. Securities premium reserve

Securities premium reserve has been created on account of the premium received on issue of shares and capital and reorganisation reserve reclassified as share premium in the year ended March 31, 1993.

* The Board of Directors have proposed a final dividend of Rs. 4.00 per share for the financial year 2017-18 (2016-17 - Rs. 6.50 per share) aggregating to Rs. 837.62 lakhs (including corporate dividend tax). The proposed dividend for 2017-18 is subject to approval of shareholders in the ensuing Annual General Meeting and has not been considered in these Standalone Financial Statements.

** Included in âItems of other comprehensive incomeâ in statement of changes in equity.

Repayment terms and security disclosure for the outstanding borrowings as at March 31, 2018:

From banks:

Secured borrowings:

a) Nil (March 31,2017: Rs.450.53 lakhs, April 01,2016: Rs.807.98 lakhs), Rs.414.30 lakhs (March 31,2017: Rs.627.55 Lakhs, April 01,2016: Rs.835.91 lakhs), Rs.2461.97 lakhs (March 31,2017: Nil, April 01,2016: Nil), Nil (March 31,2017: Nil, April 01,2016: Rs.623.26 lakhs) and Rs.634.43 lakhs (March 31,2017: Nil, April 01,2016: Nil) currently carrying interest between 8.95% p.a. to 10.60%, repayable in 0, 8, 16, 0 and 16 quarterly installments respectively, were/are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

b) Nil (March 31,2017: Rs.279.60 lakhs, April 01,2016: Rs.558.63 lakh), Nil (March 31,2017: Rs.308.35 lakhs, April 01,2016: Rs.513.05 lakhs) and Nil (March 31,2017: Nil, April 01: Rs.119.93 lakhs) were secured by a first charge on specific movable assets of Shriram Rayons, a unit of the Company.

c) Nil (March 31,2017: Rs. 120.50 lakhs, April 01,2016: Rs. 282.44 lakhs) was secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, both present and future, excluding the assets exclusively charged subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/ to be created in favour of first charge holders for their respective term loans

d) Rs. 632.51 lakhs (March 31,2017: Rs. 1210.89 lakhs, April 01,2016: Rs. 1893.59 lakhs), Rs. 84.86 lakhs (March 31,2017: Rs. 163.19 lakhs, April 01,2016: Rs. 235.00 lakhs) and Nil (March 31,2017: Nil, April 01,2016: Rs.1992.09 lakhs) carrying interest of 12% p.a., repayable in 12, 13 and 0 monthly installments respectively, were/are secured by a residual charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

e) Rs. 519.59 lakhs (March 31,2017: Rs. 1034.20 lakhs, April 01,2016: Rs. 1556.38 lakhs) carrying interest of 10.65% p.a., repayable in 4 quarterly installments, is secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans and 2nd pari-passu charge on all current assets of sugar division of the Company excluding stocks pledged with Distt. Co-operative Banks.

f) Nil (March 31,2017: Rs. 320.64 lakhs, April 01,2016: Rs. 435.46 lakhs) was secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of first charge holders for their respective term loans and exclusive charge on assets acquired / to be acquired out of the loan in Distillery and Chemical divisions of Daurala Sugar Works and Shriram Rayons, units of the Company.

g) Rs.197.00 lakhs (March 31,2017: Rs. 296.23 lakhs, April 01,2016: Rs. 320.33 lakhs) carrying interest of 9.40% p.a., repayable in 8 quarterly installments, is secured by a first charge on specific movable assets of Distillery division of Daurala Sugar Works, a unit of the Company.

h) Nil (March 31,2017: Nil, April 01,2016: Rs. 202.09 lakhs) was secured by a first pari-passu charge on entire fixed assets of the Company, both present and future, excluding the assets exclusively charged and those pertaining to Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of existing first charge holders for their respective term loans / debentures. Also exclusive charge on assets to be acquired in Daurala Organics, a unit of the Company.

i) Nil (March 31,2017: Nil, April 01,2016: Rs.1,000.00 lakhs) and Nil (March 31,2017: Nil, April 01,2016: Rs.801.06 lakhs) were secured by a first mortgage and charge on all fixed assets of Sugar factory at Daurala Sugar Works, a unit of the Company, subject to prior charges created / to be created in favour of the Companyâs bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

j) Rs. 24.96 lakhs (March 31,2017: Rs. 34.01 lakhs, April 01,2016: Rs. 52.11 lakhs) currently carrying interest of 10.45% p.a., repayable in 30 monthly installments, is secured by hypothecation of specific assets.

From others:

Secured borrowings:

a) Nil (March 31, 2017: Nil, April 1, 2016: Rs. 360.99 lakhs) was secured by an exclusive second charge on immovable and movable assets of sugar factory at Daurala Sugar Works, a unit of the Company.

b) Rs.227.54 lakhs (March 31,2017: Nil, April 01,2016: Nil) carrying interest of 4.25% p.a., repayable in 8 half yearly installments, is secured by a first pari-passu charge on immovable and movable properties of sugar Factory at Daurala Sugar Works, a unit of the Company.

Public deposits:

Unsecured borrowings:

Rs.655.49 lakhs (March 31,2017: Rs. 494.99 , April 01,2016: Rs. 476.59), carrying interest of 9.5% to 10.5% p.a., is currently repayable after 3 years from the date of acceptance of deposits.

The Companyâs exposure to interest rate risks related to above financial liabilities is disclosed in Note 46.

3. Operating lease - As a lessee

The Company has entered into operating leases agreements for various premises taken for accommodation of Companyâs officers / directors and various offices of the Company. The lease rental expense recognised in the Statement of Profit and Loss for the period in respect of leases is Rs. 599.70 lakhs (March 31, 2017: Rs. 525.72 lakhs).

4. Contingent liabilities and commitments

A. Contingent liabilities

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

B. Commitments

a. Capital commitments: Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 2492.74 lakhs (March 31, 2017: Rs. 519.02 lakhs, April 1, 2016: Rs. 207.46 lakhs).

b. Other commitments: The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in normal course of business. The Company does not have any long term commitments / contracts including derivative contracts for which there will be any material foreseeable losses.

5. Proceedings in a Petition challenging the Preferential Issue of equity warrants by the Company filed by a shareholder before the Honâble Company Law Board (now National Company Law Tribunal) are continuing since November, 2007.

6. Earnings per share

Basic and diluted earnings/ (loss) per share

Basic and diluted earnings/ (loss) per share is calculated by dividing the profit/ (loss) during the year attributable to equity shareholders of the Company by the weighted number of equity shares outstanding during the year.

7. Employee benefits

A. Defined Contribution plans

Rs. 705.54 lakhs (March 31, 2017: Rs. 660.72 lakhs) for provident fund contribution and Rs. 163.85 lakhs (March 31, 2017: Rs. 276.09 lakhs) for superannuation fund contribution have been charged to the Statement of Profit and Loss. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

B. Defined benefit plans

Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

Gratuity:

Gratuity scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

Although the analysis does not take into account the full distribution of cash flows expected under the plan, it does provide an approximation of the sensitivity of the assumptions shown.

Sensitivities due to mortality & withdrawls are insignificant and hence not considered in sensitivity anaylsis disclosed.

(viii) Maturity profile

The table below shows the expected cash flow profile of the benefits to be paid to the current membership of the plan based on past service of the employees as at the valuation date:

C. Compensated absences:

The obligation of compensated absence in respect of the employees of the Company as at 31 March 2018 works out to Rs. 1,149.41 lakhs (31 March 2017: Rs. 1,007.04 lakhs, 1 April 2016: Rs. 897.99 lakhs)

D. Risk exposure:

These defined benefit plans typically expose the Company to actuarial risks as under:

a) Investment Risk

The present value of the defined benefit plan liability is calculated using a discount rate which is determined by reference to market yields at the end of the reporting period on government bonds.

b) Interest rate risk

A decrease in bond interest rate will increase the plan liability. However, this shall be partially off-set by increase in return as per debt investments.

c) Longevity risk

d) Salary risk

Higher than expected increase in salary will increase the defined benefit obligation.

8. Related party disclosures:

A. Names of related parties and nature of related party relationship

Subsidiary: Daurala Foods and Beverages Private Limited Associate: DCM Hyundai Limited

Key management personnel

Mr. Tilak Dhar, Chairman & Managing Director

Mr. Alok B.Shriram, Vice Chairman & Dy. Managing Director

Mr. Madhav B.Shriram, Deputy Managing Director

Mr. K.N. Rao, Director & CEO Rayons

Mr. P.R. Khanna, Independent Director

Mr. S.B. Mathur, Independent Director

Mr. Ravinder Narain, Independent Director

Mr. S.C. Kumar, Independent Director

Mr. C. Vikas Rao, Independent Director

Ms. Kavitha Dutt Chitturi, Independent Director

Mr. N.K. Jain, Chief Financial Officer

Mr. Y.D. Gupta, Chief General Manager & Company Secretary

Relatives/HUF of key management personnel

M/s. Bansi Dhar & Sons - HUF Mr. Akshay Dhar Ms. Kanika Shriram

Mr. Rudra Shriram Mr. Rohan Shriram Mr. Uday Shriram Mrs. K. Rao Mrs. Anita Gupta Mrs. Manju Jain Mr. Nirmal Kumar Jain Mrs. Maya Rani Jain Mr. Rajat Jain Mrs. Kiran Khanna Mr. P. R. Khanna (HUF)

Others (Enterprises over which key management personnel or their relatives are able to exercise significant influence)

Bantam Enterprises Private Limited

H.R. Travels Private Limited Hindustan Vaccum Glass Private Limited

# The Companyâs borrowings have been contracted at both floating and fixed rates of interest. The borrowings at floating rates reset at short intervals. Accordingly, the carrying value of such borrowings (including interest accrued but not due) approximates fair value.

* The carrying amounts of trade receivables, trade payables, cash and cash equivalents, investments, bank balances other than cash and cash equivalents and other financial assets and liabilities, approximates the fair values, due to their short-term nature. The other non-current financial assets represent security deposits given to various parties, loans and advances to employees and bank deposits (due for maturity after twelve months from the reporting date), and other noncurrent financial liabilities, the carrying value of which approximates the fair values as on the reporting date.

There have been no transfers between Level 1, Level 2 and Level 3 for the years ended March 31, 2018 and March 31, 2017.

Valuation

Following financial instruments are remeasured at fair value as under :

(a) The fair value of investments in quoted Equity Shares and Mutual Funds are measured at quoted price or NRV.

(b) All foreign currency denominated assets are translated using exchange rate at reporting date.

Risk Management

The Company Manages risk arising from financial instruments as under :

Credit risk is the risk that a customer or counterparty to a financial instrument will fail to perform or pay amounts due causing financial loss to the company. It arises from cash and cash equivalents, financial instruments and principally from credit exposure to customers relating to outstanding receivables. The company continuously reviews the credit to be given and the recoverability of amounts due. Majority of the trade receivables are from parties with whom the company had long standing satisfactory dealings.

* The Company believes that the unimpaired amounts that are past due by more than 30 days are still collectible in full, based on historical payment behaviour.

# The company continuously reviews the credit to be given and the recoverability of amounts due. Majority of the trade receivables, both domestic and overseas, are from parties with whom the company had long standing satisfactory dealings.

Movement in the allowance for impairment in respect of trade receivables is given below:

Note

Cash and cash equivalents

Credit risk on cash and cash equivalents is limited as the Company generally transacts with the Banks with high credit ratings assigned by domestic and international credit rating agencies.

Other financial assets

Other financial assets do not have any significant credit risk

b. Financial risk management (continued)

(ii) Liquidity risk

Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companyâs approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are fallen due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companyâs reputation.

The Company believes that its liquidity position, including total cash and cash equivalent and bank balances other than cash and cash equivalent of Rs. 1,229.11 lakhs as at March 31, 2018 (March 31, 2017 Rs. 912.84 lakhs, April 1, 2016 Rs. 782.20 lakhs), anticipated future internally generated funds from operations, and its fully available, revolving undrawn credit facility will enable it to meet its future known obligations in the ordinary course of business. However, if liquidity needs were to arise, the Company believes it has access to financing arrangements, which should enable it to meet its ongoing capital, operating, and other liquidity requirements. The Company will continue to consider various borrowing or leasing options to maximize liquidity and supplement cash requirements as necessary.

The Companyâs liquidity management process as monitored by management, includes the following:

- Day to day funding, managed by monitoring future cash flows to ensure that requirements can be met.

- Maintaining rolling forecasts of the Companyâs liquidity position on the basis of expected cash flows.

- Maintaining diversified credit lines.

I. Financial arrangements

The company had access to the following undrawn borrowing facilities at the end of the reporting period:

III. Market risk

Market risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises two types of risk: currency risk and interest rate risk. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.The Board of directors is responsible for setting up of policies and procedures to manage market risks of the Company.

Currency risk

Currency risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company is exposed to the effects of fluctuation in the prevailing foreign currency exchange rates on its financial position and cash flows. Exposure arises primarily due to exchange rate fluctuations between the functional currency and other currencies from the Companyâs operating, investing and financing activities.

Sensitivity analysis

A reasonably possible strengthening / weakening of the Indian Rupee against below currencies at March 31, 2018 (previous year ended as on March 31, 2017) would have affected the measurement of financial instruments denominated in functional currency and affected equity and profit or loss by the amounts shown below. This analysis is performed on foreign currency denominated monetary financial assets and financial liabilities outstanding as at the year end. This analysis assumes that all other variables, in particular interest rates, remain constant and ignores any impact of forecast sales and purchases.

USD: United States Dollar, EUR: Euro, GBP: Great British Pound, AUD:Australian Dollar, NZ$: New Zealand Dollar

b. Financial risk management (continued)

III. Market risk Interest rate risk

Interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk.

Exposure to interest rate risk

The Companyâs interest rate risk arises majorly from the term loans from banks carrying floating rate of interest. These obligations exposes the Company to cash flow interest rate risk. The exposure of the Companyâs borrowing to interest rate changes as reported to the management at the end of the reporting period along with the interest rate profile are as follows:

Cash flow sensitivity analysis for variable-rate instruments

A reasonably possible change of 100 basis points (bps) in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.

9. Capital management

For the purpose of the Companyâs capital management, capital includes issued equity share capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the management of the Companyâs capital structure is to maintain an efficient mix of debt and equity in order to achieve a low cost of capital, while taking into account the desirability of retaining financial flexibility to pursue business opportunities and adequate access to liquidity to mitigate the effect of unforeseen events on cash flows.

The Company manages its capital structure and makes adjustments to it in light of changes in the economic/ business conditions and requirements.

The Companyâs debt to capital ratio, which is calculated as interest-bearing debts (less cash & cash equivalents) divided by total capital (equity attributable to equity share holders plus interest-bearing debt) is as under:

10. Explanation of transition to Ind AS

As mentioned in note 2, to the standalone financial statements, these financial statements for the year ended March 31, 2018, are the first financial statements of the Company prepared in accordance with the Indian Accounting Standards (âInd ASâ) notified under the Companies (Indian Accounting Standards) Rules, 2015. For periods up to and including the year ended March 31, 2017, the Company prepared its financial statements in accordance with âprevious GAAPâ, including accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended).

The accounting policies set out in Note 2A have been applied in preparing these financial statements for the year ended March 31, 2018 including the comparative information for the year ended March 31, 2017 and the opening standalone Ind AS balance sheet as on the date of transition i.e. April 1, 2016.

Accordingly, the Company has prepared financial statements which comply with Ind AS applicable for periods ended on or after March 31, 2018, together with the comparative period data as at and for the year ended March 31, 2017, as described in the summary of significant accounting policies. In preparing these financial statements, the Companyâs opening balance sheet was prepared as at April 1, 2016, the Companyâs date of transition to Ind AS.

This note explains the principal adjustments made by the Company in restating its previous GAAP financial statements, including the balance sheet as at April 1, 2016 and the financial statements as at and for the year ended March 31, 2017. According to Ind AS 101, the first Ind AS financial statements must use recognition and measurement principles that are based on standards and interpretations that are effective for the financial year ended March 31, 2018. These accounting principles and measurement principles must be applied retrospectively to the date of transition to Ind AS and for all periods presented within the first Ind AS financial statements. Any resulting differences between carrying amounts of assets and liabilities according to Ind AS 101 as of April 1, 2016 compared with those presented in the previous GAAP Balance Sheet as of March 31, 2016, were recognised in equity within the Ind AS Balance Sheet.

A. Exemptions and exceptions availed

Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.

Transition elections

Explanation of the Ind AS 101 exceptions and exemptions to the full retrospective application of Ind AS applied by the Company.

In the Ind AS opening Balance Sheet as at April 1, 2016, the carrying amounts of assets and liabilities from the previous GAAP as at March 31, 2016 are generally recognized and measured according to Ind AS in effect for the financial year ended as on March 31, 2018. For certain individual cases, however, Ind AS 101 provides for optional exemptions to the general principles of retrospective application of Ind AS. The Company has made use of the following exemptions in preparing its Ind AS opening Balance Sheet.

a) Ind AS optional exemptions:

(i) Property, plant and equipment and intangible assets

Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment and intangible assets as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. Accordingly, the Company has elected to measure the property, plant and equipment and intangible assets at their previous GAAP values (except land, building and plant and machinery for which the Company has decided to measure them at previous GAAP revalued amount)

(ii) Determining whether an arrangement contains a lease

Appendix C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. However, Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected not to be material. The Company has elected to apply this exemption for such contracts/arrangements.

(iii) Business combinations

Ind AS 101 provides the option to apply Ind AS 103 prospectively from the transition date or from a specific date prior to the transition date. This provides relief from full retrospective application that would require restatement of all business combinations prior to the transition date. Accordingly, the Company elected to apply Ind AS 103 prospectively to business combinations occurring after its transition date. Business combinations occurring prior to the transition date have not been restated.

(iv) Investment in subsidiaries and associates

Ind AS 101 permits first-time adopter to elect to continue with the carrying value for its investments in subsidiaries, joint ventures and associates as recognised in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as the date of transition. Accordingly, the Company has elected to measure its investments in subsidiaries and associates at their previous GAAP values.

b) Ind AS mandatory exceptions:

(i) Estimates

An entityâs estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at April 1, 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company has made estimates for following items in accordance with Ind AS at the date of transition as these were not required under previous GAAP:

a) Determination of the discounted value for financial instruments carried at amortised cost

b) Impairment of financial assets based on expected credit loss model

(ii) Classification and measurement of financial assets

Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

B. Reconciliations between previous GAAP and Ind AS:

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

C. Notes to the reconciliations:

1. Revaluation reserve set to zero on account of deemed cost exemption

Under previous GAAP, certain items of property, plant and equipment were revalued and a revaluation reserve was created. Under Ind AS, the revaluation reserve outstanding as at the date of transition (i.e. April 1, 2016) amounting to Rs. 1,602.89 lakhs have been recognised in retained earnings. The profit for the year ended March 31, 2017 decreased by Rs. 134.95 lakhs as a result of increased depreciation expense.

2. Fair valuation of investments in mutual funds

Under previous GAAP, investments in mutual funds were carried at lower of cost or market price. Under Ind AS, these investments are required to be measured at fair value. The resulting fair value changes of these investments amounting to Rs. 32.08 lakhs have been recognised in total equity as at the date of transition (i.e. April 1, 2016). The profit for the year ended March 31, 2017 has decreased by Rs 7.66 lakhs and total equity for the year ended March 31, 2017 has increased by Rs. 24.42 lakhs due to the fair value changes.

3. Borrowings

Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the profit or loss over the tenure of the borrowing as part of the interest expense by applying the effective interest rate method. Under previous GAAP, these transaction costs were charged to profit or loss as and when incurred. Accordingly, borrowings as at March 31, 2017 have been reduced by Rs. 20.56 lakhs (April 1, 2016 - Rs. 70.36 lakhs) with a corresponding increase in retained earnings. The transaction costs amounting to Rs. 1.98 lakhs on undrawn amount of borrowings have been recognised under other current assets as on 1 April, 2016 with a corresponding increase in retained earnings. The profit for the year ended March 31, 2017 reduced by Rs. 49.01 lakhs as a result of the additional interest expense based on the effective interest method.

4. Security deposits

Under Previous Indian GAAP, interest free security deposits (that are refundable in cash on completion of the term) are recorded at their transaction value. Under Ind AS, such financial assets are required to be recognised initially at their fair value and subsequently at amortised cost. Difference between the fair value and transaction value of the security deposit has been recognised as deferred rent. Consequent to this change the amount of security deposit as on March 31, 2017 has decreased by Rs.7.51 lakhs (April 1, 2016 : Rs. 11.38 lakhs) with a creation of deferred rent (included in other noncurrent and current assets) of Rs. 7.38 lakhs (April 1, 2016 : Rs. 11.38 lakhs). The unwinding of security deposit happens by recognition of a notional interest income in Statement of Profit and Loss at effective interest rate. The deferred rent gets amortised on a straight line basis over the term of the security deposits. The profit and total equity for the year ended March 31, 2017 decreased by Rs. 0.13 lakhs due to amortisation of deferred rent by Rs. 4.00 lakhs and increase in notional interest income of Rs. 3.87 lakhs recognised on security deposits (included in other income).

5. Proposed dividend

Under the previous GAAP upto March 31, 2016, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognised as a liability. Under Ind AS, such dividends are recognised when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and corporate dividend tax of Rs. Nil lakhs as at March 31, 2017 (April 1, 2016 - Rs. 628.21 lakhs) included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.

6. Government grant

Under the previous GAAP, interest expense was recorded net of interest subvention. Under Ind AS, the amount of interest expense is recorded on gross basis and the benefit of interest subvention is recorded as government grant under other income. As a result, other income for the year ended March 31, 2017 is increased by Rs. 696.08 lakhs with a corresponding increase in finance cost amounting to Rs. 696.08 lakhs. There is no impact on the total equity as at March 31, 2017.

7. Employee benefits: Remeasurement of post employment benefit plans

Under Ind AS, remeasurements i.e. actuarial gains and losses on the net defined benefit liability are recognised in other comprehensive income instead of statement of profit and loss. Under previous GAAP these were forming part of the statement of profit and loss for the year. As a result. employee benefit expense to the extent of actuarial loss amounting to Rs. 109.65 lakhs (net of taxes) for the year ended March 31, 2017 has been reduced and the same has been reclassified to other comprehensive income. There is no impact on the total equity as at March 31, 2017.

8. Grossing up of bills discounting

Under previous GAAP, trade receivables and current borrowings were set -off on discounting of bills. Under Ind AS, such bills dicounting is presented on gross basis as these do not meet the conditions of set-off. Consequent to this change the amount of trade receivables as on March 31, 2017 has increased by Rs. 1120.71 lakhs (April 1, 2016 : Rs. 989.24 lakhs) with a corresponding increase in current borrowings by Rs. 1120.71 lakhs (April 1, 2016 : Rs. 989.24 lakhs). There is no impact on the total equity as at March 31, 2017.

9. Revenue from operations

Under previous GAAP, revenue from operations was disclosed net of excise duty on sales. Under Ind AS, revenue is shown gross of excise duty and the amount of excise duty is shown as expense in the statement of profit and loss. Consequent to this change the amount of revenue from operations for the year ended March 31, 2017 has increased by Rs. 6332.34 lakhs and a separate line item for expense on account of excise duty amounting to Rs. 6332.34 lakhs is presented in the statement of profit and loss. There is no impact on the total equity as at March 31, 2017.

10. Deferred tax

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base.

In addition, the various transitional adjustments lead to temporary differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in reserve and surplus or a separate component of equity. On the date of transition (i.e April 1, 2016), the net impact on deferred tax liabilities is of Rs. 317.56 lakhs (March 31, 2017: Rs. 250.40 lakhs). The profit and total equity for the year ended March 31, 2017 increased by Rs. 67.16 lakhs due to differences in taxable profits and accounting profits.

11. Other comprehensive income

Under previous GAAP, there was no requirement to disclose any item of statement of profit and loss in other comprehensive income. However as per requirement of Ind AS certain items of profit or loss are to be reclassified to other comprehensive income. Consequent to this, the Company has reclassified remeasurement of defined benefit plans from the statement of profit and loss to other comprehensive income.

11. Research and development expenses amounting to Rs. 472.95 lakhs (March 31, 2017: Rs. 170.33 lakhs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 48.61 lakhs (March 31, 2017: Rs. 18.05 lakhs) has been included in property, plant and equipment.

12. Parties covered under âThe Micro, Small and Medium Enterprise Development Act, 2006â (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Rs. Nil (March 31, 2017: Rs. Nil, April 1, 2016: Rs. Nil). Further no interest during the year has been paid or is payable under the terms of the MSMED Act, 2006.

13. Disclosures related to government grant

The government grant/government assistance recognised are as under:

Mar 31, 2017

1. Banks

2. Nil (2015-16 - Rs.625.00 lakhs), Rs.453.12 lakhs (2015-16 - Rs. 815.63 lakhs) and Rs.630.00 lakhs (2015-16 - Rs.840.00 lakhs) currently carrying interest between 7.20% p.a. to 12.25% p.a.(net of interest subvention), repayable in 0, 5 and 12 quarterly installments respectively, are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

3. Nil (2015-16 - Rs.202.39 lakhs) was secured by first pari-passu charge on entire fixed assets of the Company, both present and future, excluding the assets exclusively charged and those pertaining to Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of first charge holders for their respective term loans. Also exclusive charge on assets to be acquired in Daurala Organics, a unit of the Company.

4. Nil (2015-16 - Rs.12000 lakhs), Rs.280.00 lakhs (2015-16 - Rs.56000 lakhs) and Rs.309.37 lakhs (2015-16 - Rs.51562 lakhs) currently carrying interest between 7.30% p.a. to 8.40% p.a. (net of interest subvention), repayable in 0, 4 and 6 quarterly installments respectively, are secured by first charge on specific movable assets of Shriram Rayons, a unit of the Company.

5. Rs.122.42 lakhs (2015-16 - Rs.291.17 lakhs) currently carrying interest of 12.30% p.a. repayable in 6 quarterly installments is secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, both present and future, excluding the assets exclusively charged subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

6. Rs.1213.89 lakhs (2015-16 - Rs.1900.00 lakhs), Rs.163.19 lakhs (2015-16 - Rs.235.00 lakhs) and Nil (2015-16 - Rs.2000.00 lakhs) carrying Nil interest (net of interest subvention), repayable in 23 and 25 monthly installments respectively, are secured by residual charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

7. Rs.1040.00 lakhs (2015-16 - Rs.1560.00 lakhs) carrying Nil interest (net of interest subvention), repayable in 8 quarterly installments, is secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans and 2nd pari-passu charge on all current assets of sugar division of the Company excluding stocks pledged with Distt. Co-operative Banks.

8. Nil (2015-16 - Rs.1000.00 lakhs) and Nil (2015-16 - Rs.812.00 lakhs) were secured by a first mortgage and charge on all fixed assets of Sugar factory at Daurala Sugar Works, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans

9. Rs.325.19 lakhs (2015-16 - Rs.447.97 lakhs) carrying interest of 12.45% p.a., repayable in 14 quarterly installments, is secured by first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of first charge holders for their respective term loans and exclusive charge on assets acquired / to be acquired out of the loan in Distillery and Chemical divisions of Daurala Sugar Works and Shriram Rayons, units of the Company.

10. Rs.297.77 lakhs (2015-16 - Rs.322.79 lakhs) carrying interest of 11.15% p.a., repayable in 15 quarterly installments, is secured by first charge on specific movable assets of Distillery division of Daurala Sugar Works, a unit of the Company.

11. Rs.34.01 lakhs (2015-16 - Rs.52.11 lakhs) currently carrying interest of 10.20% p.a., repayable in 42 monthly installments, is secured by hypothecation of specific assets.

12. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 519.02 lakhs (2015-16 - Rs. 207.46 lakhs).

13. The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in normal course of business. The Company does not have any long term commitments / contracts including derivative contracts for which there will be any material foreseeable losses.

14. Research and development expenses amounting to Rs. 170.33 lakhs (2015-16 - Rs. 165.27 lakhs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 18.05 lakhs (2015-16 - Rs. Nil) has been included in fixed assets.

15. Parties covered under âThe Micro, Small and Medium Enterprise Development Act, 2006â (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Rs. Nil (2015-16 - Rs. Nil). Further no interest during the year has been paid or is payable under the terms of the MSMED Act, 2006.

16. Segment reporting

17.. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" Specified under Section 133 of the Act, the Company''s business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fine Chemicals).

18. Geographical segments

The Company''s geographical segments are Domestic and Overseas, by location of customers.

19. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of notes forming part of the financial statement, the accounting policies in relation to segment accounting are as under :-

20. Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities allocable to two or more segments are allocated to the segments on a reasonable basis.

21. Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

22. Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

23. Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

24. Related party disclosures under Accounting Standard (AS)18 A. Names of related parties and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Private Limited (DFBPL).

Associate : DCM Hyundai Limited (DHL).

Key management personnel : Mr. Tilak Dhar, Mr. Alok B. Shriram, Mr. Madhav B. Shriram and Mr. K. N. Rao.

Relatives/HUF of key management personnel : Mr. Akshay Dhar, Ms. Kanika Shriram, Mr. Rudra Shriram, Mrs. K. Rao and M/s. Bansi Dhar & Sons - HUF (BDS).

Others (Enterprise over which key management personnel or their relatives are able to exercise significant influence) : Bantam Enterprises Private Limited (BEPL) and H.R. Travels Private Limited (HRTPL).

25. Disclosures in respect of assets taken on Operating Lease under Accounting Standard (AS) 19 "Leases" is as under :

26. The Company has entered into operating leases agreements for various premises taken for accommodation of Company''s officers / directors and various offices of the Company. As at March 31, 2017 the future minimum lease payments under non-cancellable period which is not later than one year are Rs. Nil (2015-16 - Rs. Nil).

27. Lease rent charged to the Statement of Profit and Loss relating to operating leases entered or renewed after April 1, 2001 are Rs. 521.72 lakhs (2015-16 - Rs. 489.06 lakhs).

28. The Company has implemented Revised Accounting Standard (AS-10) âProperty, Plant and Equipmentâ applicable w.e.f. 1st April, 2016, and adopted the Cost Model. Consequently, the Revaluation amount of Rs. 1602.89 lakhs as on 31st March, 2016, included in Fixed Assets (Note 12) has been adjusted against corresponding Revaluation Reserve in Reserves and Surplus (Note 3).

Mar 31, 2016

I. Banks

a) Nil (2014-15 - Rs.141.00 lacs), Rs.625.00 lacs (2014-15 - Rs.1250.00 lacs), Rs.815.63 lacs (2014-15 - Rs.1178.13 lacs) and Rs.840.00 lacs (2014-15 - Rs.1050.00 lacs) currently carrying interest between 7.20% p.a. to 12.50% p.a.(net of interest subvention), repayable in 0, 4, 9 and 16 quarterly installments respectively, are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

b) Rs.202.39 lacs (2014-15 - Rs.555.33 lacs) carrying interest of 12.50% p.a., repayable in 2 quarterly installments, is secured by first pari-passu charge on entire fixed assets of the Company, both present and future, excluding the assets exclusively charged and those pertaining to Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of first charge holders for their respective term loans. Also exclusive charge on assets to be acquired in Daurala Organics, a unit of the Company.

c) Rs.120.00 lacs (2014-15 - Rs.240.00 lacs), Rs.560.00 lacs (2014-15 - Rs.840.00 lacs) and Rs.515.62 lacs (2014-15 - Rs.721.87 lacs) currently carrying interest between 7.30% p.a. to 12.25% p.a. (net of interest subvention), repayable in 4, 8 and 10 quarterly installments respectively, are secured by first charge on specific movable assets of Shriram Rayons, a unit of the Company.

d) Nil (2014-15 - Rs.81.00 lacs) was secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created in favour of first charge holders for their respective term loans.

e) Rs.291.17 lacs (2014-15 - Rs.459.92 lacs) currently carrying interest of 12.30% p.a. repayable in 10 quarterly installments is secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, both present and future, excluding the assets exclusively charged subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

f) Rs.1900.00 lacs (2014-15 - Rs.1900.00 lacs), Rs.235.00 lacs (2014-15 - Rs.235.00 lacs) and Rs.2000.00 lacs (2014-15 - Nil) carrying interest between Nil to 1.20% p.a. (net of interest subvention), repayable in 36, 36 and 12 monthly installments respectively, are secured by residual charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

g) Rs.1560.00 lacs (2014-15 - Rs.1560.00 lacs) carrying Nil interest (net of interest subvention), repayable in 12 quarterly installments, is secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans and 2nd pari-passu charge on all current assets of sugar division of the Company excluding stocks pledged with Distt. Co-operative Banks.

h) Rs.1000.00 lacs (2014-15 - Nil) and Rs.812.00 lacs (2014-15 - Nil) currently carrying interest of 2.00% p.a. and 2.35% p.a. (net of interest subvention), repayable in 12 monthly and 8 quarterly installments respectively, are secured by a first mortgage and charge on all fixed assets of Sugar factory at Daurala Sugar Works, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of first charge holders for their respective term loans.

i) Rs.447.97 lacs (2014-15 - Nil) carrying interest of 11% p.a., repayable in 16 quarterly installments, is secured by first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company''s bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of first charge holders for their respective term loans and exclusive charge on assets acquired / to be acquired out of the loan in Distillery and Chemical divisions of Daurala Sugar Works and Shriram Rayons, units of the Company.

j) Rs.322.79 lacs (2014-15 - Nil) carrying interest of 11.20% p.a., repayable in 16 quarterly installments, is secured by first charge on specific movable assets of Distillery division of Daurala Sugar Works, a unit of the Company.

k) Rs.52.11 lacs (2014-15 - Rs.17.90 lacs) currently carrying interest of 10.20% p.a., repayable in 54 monthly installments, is secured by hypothecation of specific assets.

1. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 207.46 lacs (2014-15 - Rs. 104.73 lacs).

b) The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in normal course of business. The Company does not have any long term commitments / contracts including derivative contracts for which there will be any material foreseeable losses

2. Research and development expenses amounting to Rs. 165.27 lacs (2014-15 - Rs. 146.50 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Nil (2014-15 -Rs. 58.76 lacs) has been included in fixed assets.

3. Parties covered under âThe Micro, Small and Medium Enterprise Development Act, 2006â (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Nil (2014-15 - Rs. 1.35 lacs). Further no interest during the year has been paid or is payable under the terms of the MSMED Act, 2006.

4. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 âSegment Reportingâ specified under section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014, the Companyâs business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fine Chemicals).

B. Geographical segments

The Companyâs geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

i) Segment assets and liabilities

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

5. Disclosures in respect of assets taken on Operating Lease under Accounting Standard (AS) 19 âLeasesâ is as under :

i) The Company has entered into operating leases agreements for various premises taken for accommodation of Companyâs officers / directors and various offices of the Company. As at March 31, 2016 the future minimum lease payments under non-cancellable period which is not later than one year are Rs. Nil (2014-15 - Rs. Nil).

ii) Lease rent charged to the Statement of Profit and Loss relating to operating leases entered or renewed after April 1, 2001 are Rs. 489.06 lacs (2014-15 - Rs. 502.33 lacs).

6. Proceedings in a Petition filed by a shareholder before the Honâble Company Law Board (CLB) u/s 397/398 of the Companies Act, 1956 in November 2007, challenging the preferential issue of equity warrants by the Company, are continuing.

7. Employee benefits

a) Defined contribution plans

Rs. 516.12 lacs (2014-15 - Rs. 642.24 lacs) for provident fund contribution and Rs. 249.51 lacs (2014-15 - Rs. 154.96 lacs) for superannuation fund contribution have been charged to the Statement of Profit and Loss. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

8. Schedule II of the Companies Act, 2013 became applicable w.e.f. April 1, 2014. Accordingly, in respect of fixed assets where the remaining useful life as per Schedule II was Nil as on April 1, 2014 the carrying amount (after retaining residual value) of Rs. 556.06 lacs (including revalued amount Rs. 316.94 lacs and net of deferred tax Rs. 123.13 lacs) was adjusted against the opening balance of Surplus in Statement of Profit and Loss and the revalued amount was transferred from Revaluation reserve to General reserve in the previous year.

9. The Govt. of Uttar Pradesh had announced subsidy on sugarcane purchased during sugar season 2014-15 to be finalized by a Committee constituted by them. During the year the company received Rs. 4815.57 lacs against the same out of which Rs. 3277.93 lacs was accounted for in 2014-15 and balance Rs. 1537.64 lacs has been accounted for in the Statement of Profit and Loss for the year by adjustment of raw material consumption in note 23.

10. Previous yearâs figures have been regrouped / recast wherever necessary to correspond with the current yearâs classification / disclosures.

Mar 31, 2015

I. Banks

a) Nil (2013-14 - Rs. 200.00 lacs), Rs. 141.00 lacs (2013-14 - Rs. 713.00 lacs), Rs.1250.00 lacs (2013-14 - Rs.1875.00 lacs), Rs.1178.13 lacs (2013-14 - Rs. 1450.00 lacs) and Rs.1050.00 lacs (2013-14 - Rs. 276.33 lacs) currently carrying interest between 7.75% to 13.00% (net of interest subvention) and repayable in 0, 1,8, 13 and 20 quarterly installments respectively are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

b) Rs. 555.33 lacs (2013-14 - Rs. 1025.92 lacs) carrying interest of 12.50% and repayable in 5 quarterly installments is secured by first pari-passu charge on entire fixed assets of the Company, both present and future, excluding the assets exclusively charged and those pertaining to Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of existing first charge holders for their respective term loans / debentures. Also exclusive charge on assets to be acquired in Daurala Organics, a unit of the Company.

c) Nil (2013-14 - Rs.163.71 lacs), Rs. 240.00 lacs (2013-14 - Rs. 360.00 lacs), Rs. 840.00 lacs (2013-14 - Rs. 1120.00 lacs) and Rs. 721.87 lacs (2013-14 - Rs. 414.88 lacs) currently carrying interest between 7.50% to 12.75% (net of interest subvention) and repayable in 0, 8, 12 and 14 quarterly installments respectively are secured by first charge on specific movable assets of Shriram Rayons, a unit of the Company.

d) Rs. 81.00 lacs (2013-14 - Rs. 231.00 lacs) currently carrying interest of 14.25% repayable in 3 quarterly installments is secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

e) Rs. 459.92 lacs (2013-14 - Rs.124.46 lacs) currently carrying interest of 12.50% repayable in 14 quarterly installments is secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, both present and future, excluding the assets exclusively charged subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

f) Rs. 1900.00 lacs (2013-14 - Rs.1900.00 lacs) and Rs. 235.00 lacs (2013-14 - Nil) carrying Nil interest (net of interest subvention) repayable in 36 monthly installments is secured by residual charge on fixed assets of sugar factory at Daurala Sugar Works, a unit of the Company.

g) Rs. 1560.00 lacs (2013-14 -Nil) carrying Nil interest (net of interest subvention) repayable in 12 quarterly installments is secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans and 2nd pari-passu charge on all current assets of sugar division of the company excluding stocks pledged with Distt. Co-operative Banks.

h) Rs. 17.90 lacs (2013-14 - Rs. 24.72 lacs) currently carrying interest of 11.25% repayable in 38 monthly installments are secured by hypothecation of specific assets.

II. Others

Rs. 721.98 lacs (2013-14 - Rs.1082.97 lacs) carrying interest of 4% and repayable in 2 yearly installments is secured by exclusive second charge on immovable and movable assets of sugar factory at Daurala Sugar Works, a unit of the Company.

2. Provision for contingencies of Rs. 100 lacs (2013-14 Rs. 100 lacs) in Note 7 represents the maximum possible exposur on ultimate settlement of issues relating to reorganisation arrangement of the Company.

As at As at 31.03.2015 31.03.2014

3. Contingent liabilities not provided for:- (Rs. lacs) (Rs. lacs)

a) Income tax matters* 196.55 196.55

b) Excise and Service tax matters* 388.74 122.08

c) Claims against the Company not acknowledged as debts (excluding claims by employees, where amount is not ascertainable)* 773.03 784.04

d) Bills discounted 3635.81 3045.21

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

4. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 104.73 lacs (2013-14 - Rs. 1216.15 lacs).

b) The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in normal course of business. The Company does not have any long term commitments / contracts including derivative contracts for which there will be any material foreseeable losses.

5. Research and development expenses amounting to Rs. 146.50 lacs (2013-14 - Rs. 128.63 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 58.76 lacs (2013-14 - Rs. 30.04 lacs) has been included in fixed assets.

6. Parties covered under "The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Rs. 1.35 lacs (2013-14 - Nil). Further no interest during the year has been paid or is payable under the terms of the MSMED Act, 2006.

7. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notified under the Companies (Accounting Standards) Rules, 2006, the Company's business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & Fine Chemicals).

B. Geographical segments

The Company's geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of notes forming part of the financial statement, the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities allocable to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

A. Names of related parties and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Private Limited (DFBPL).

Associate : DCM Hyundai Limited (DHL).

Key management personnel : Mr. Tilak Dhar, Mr. Alok B. Shriram, Mr. D.C. Mittal (upto 30/06/2014), Mr. Madhav B. Shriram, Mr. Anil Gujral (upto 31/01/2014) and Mr. K. N. Rao (w.e.f. 01/02/2014).

Relatives/HUF of key management personnel : Mrs. Karuna Shriram, Mrs. Kiran Mittal (upto 30/06/2014), Mr. Akshay Dhar, Ms. Kanika Shriram, Mrs. Divya Shriram, Ms. Aditi Dhar, Ms. Ritu Bansal (upto 30/06/2014), Mr. Rudra Shriram (w.e.f. 22/08/2013), Mrs. K. Rao (w.e.f. 01/02/2014) and M/s. Bansi Dhar & Sons - HUF (BDS).

Others (Enterprise over which key management personnel or their relatives are able to exercise significant influence) : Bantam Enterprises Private Limited (BEPL) and H.R. Travels Private Limited (HRTPL).

B. Transactions with related parties referred to in 38 (A)

i) Transactions with subsidiary and associate

i) The Company has entered into operating leases agreements for various premises taken for accommodation of Company's officers / directors and various offices of the Company. As at March 31,2015 the future minimum lease payments under non- cancellable period which is not later than one year are Rs. Nil (2013-14 - Rs. Nil).

ii) Lease rent charged to the Statement of Profit & Loss relating to operating leases entered or renewed after April 1,2001 are Rs. 502.33 lacs (2013-14 - Rs. 468.74 lacs).

8. Proceedings in a Petition filed by a shareholder before the Hon'ble Company Law Board (CLB) u/s 397/398 of the Companies Act, 1956 in November 2007, challenging the preferential issue of equity warrants by the Company, are continuing.

9. Employee benefits

a) Defined contribution plans

Rs. 642.24 lacs (2013-14 - Rs. 577.30 lacs) for provident fund contribution and Rs.154.96 lacs (2013-14 -

Rs. 140.67 lacs) for superannuation fund contribution have been charged to the Statement of Profit and Loss.

The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

10. The Government of Uttar Pradesh has announced subsidy on sugar cane purchased during the sugar season 2014-15 linked to average selling price of sugar and its by-products during the period 1st October, 2014 to 31st May, 2015 to be finalised by a Committee to be constituted by the Government of Uttar Pradesh. Based on prevailing and expected prices, the Company is confident of realising the full subsidy of Rs. 28.60 per qtl. aggregating to Rs. 3972.41 lacs. Pending final determination of the amount of subsidy, the company has on a conservative basis accounted for Rs. 3277.93 lacs in the Statement of Profit & Loss for the year by adjustment of raw material consumption in note 23. Necessary adjustments would be made on final determination of the amount of subsidy.

11. Schedule II of the Companies Act, 2013 became applicable w.e.f. April 1,2014. Accordingly :

a) depreciation for the year computed in accordance with the useful life of fixed assets as prescribed in Schedule II is lower by Rs. 530.37 lacs and Rs. 138.62 lacs, being an amount equivalent to the additional charge arising due to revaluation has been transferred from Revaluation reserve to General reserve.

b) in respect of fixed assets where the remaining useful life as per Schedule II is Nil, the carrying amount (after retaining residual value) of Rs. 556.06 lacs (including revalued amount Rs. 316.94 lacs and net of deferred tax Rs. 123.13 lacs) has been adjusted against the opening balance of Surplus in Statement of Profit & Loss and the revalued amount has been transferred from Revaluation reserve to General reserve.

12. Previous year's figures have been regrouped / recast wherever necessary to correspond with the current year's classification / disclosures.

Mar 31, 2014

As at As at 31.03.2014 31.03.2013

1. Contingent liabilities not provided for:- (Rs. lacs) (Rs. lacs)

Income tax matters* 196.55 193.40

Excise / Service tax / Customs duty matters* 122.08 759.35 Claims against the Company not acknowledged as debts (excluding claims by employees, where amount is not ascertainable)* 784.04 1069.60

Bills discounted 3045.21 2729.45

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

2. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 1216.15 lacs (2012-13 - Rs. 297.66 lacs).

b) The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee benefits including union agreement in normal course of business. The Company does not have any long term commitments or material non-cancellable contractual commitments / contracts, which might have material impact on the financial statements.

3. Research and development expenses amounting to Rs. 128.63 lacs (2012-13 - Rs. 113.67 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 30.04 lacs (2012-13 - Rs. 53.27 lacs) has been included in fixed assets.

4. Parties covered under "The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identified on the basis of confirmations received.

Based upon the information available, the balance due to the Micro and Small Enterprises as Defined under the MSMED Act, 2006 is Nil (2012-13 - Nil). Further no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.

5. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notifed under the Companies (Accounting Standards) Rules, 2006, the Company''s business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fne Chemicals).

B. Geographical segments

The Company''s geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of notes forming part of the financial statements, the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities allocable to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

6. Related party disclosures under Accounting Standard (AS)18

A. Names of related parties and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Private Limited (DFBPL)

Associate : DCM Hyundai Limited (DHL).

Key management personnel : Mr. Tilak Dhar, Mr. Alok B. Shriram, Mr. D.C. Mittal, Mr. Madhav B. Shriram, Mr. Anil Gujral (upto 31/01/2014) and Mr. K. N. Rao (w.e.f. 01/02/2014).

Relatives/HUF of key management personnel : Mrs. Karuna Shriram, Mrs. Kiran Mittal, Mr. Akshay Dhar, Ms. Kanika Shriram, Mrs. Divya Shriram, Ms. Aditi Dhar, Ms. Ritu Bansal, Mr. Rudra Shriram (w.e.f. 22/08/2013), Mrs. K. Rao (w.e.f. 01/02/2014) and M/s. Bansi Dhar & Sons - HUF (BDS).

Others (Enterprises over which key management personnel or their relatives are able to exercise significant infuence): Bantam Enterprises Private Limited (BEPL) and H.R. Travels Private Limited (HRTPL).

7. The Company does not have any Finance Lease. Disclosures in respect of assets taken on Operating Lease under Accounting Standard (AS) 19 "Leases" is as under:

i) The Company has entered into operating leases agreements for various premises taken for accommodation of Company''s officers / directors and various offices of the Company. As at March 31, 2014 the future minimum lease payments under non- cancellable period which is not later than one year are Rs. Nil (2012-13 - Rs. 58.64 lacs).

ii) Lease rent charged to the Statement of profit & Loss relating to operating leases entered or renewed after April 1, 2001 are Rs. 468.00 lacs (2012-13 - Rs. 448.85 lacs).

8. Proceedings in a Petition fled by a shareholder before the Hon''ble Company Law Board (CLB) u/s 397/398 of the Companies Act, 1956 in November 2007, challenging the preferential issue of equity warrants by the Company, are continuing.

9. Employee benefits

a) Defined contribution plans

Rs. 577.30 lacs (2012-13 - Rs. 512.86 lacs) for provident fund contribution and Rs.140.67 lacs (2012-13 - Rs. 186.09 lacs) for superannuation fund contribution have been charged to the Statement of profit and Loss. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

Mar 31, 2013

1. A) Pursuant to the Scheme of Arrangement as approved by the High Court of Delhi vide its Order dated April 16, 1990 under sections 391 / 394 of the Companies Act, 1956, assets and liabilities relating to certain units and certain reserves of the undivided DCM Limited were transferred /allocated to the Company w.e.f. April 1,1990, being the effective date; Theexcess of net assets acquired over the share capital and reserves had been transferred to the securities premium account. b) There are various issues relating to sales tax, income-tax, interest, etc. arisen / arising out of the reorganisation arrangement which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited as and when the liabilities / benefits are finally determined. The ultimate effect of these is not ascertainable at this stage.

As at As at 31.03.2013 31.03.2012

2. Contingent liabilities not provided for:- (Rs. lacs) (Rs. lacs)

Income tax matters* 193.40 1661.60

Excise / Service tax / Customs duty matters* 759.35 734.79 Claims against the Company not acknowledged as debts

(excluding claims by employees, where amount is not ascertainable)* 1069.60 1025.54

Bills discounted 2729.45 2336.53

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

3. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) amounts to Rs. 297.66 lacs (2011-12 - Rs. 104.02 lacs).

b) The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee''s benefits including union agreement in normal course of business. The Company does not have any long term commitments or material non-cancellable contractual commitments / contracts, which might have material impact on the financial statements.

4. Research and development expenses amounting to Rs. 113.67 lacs (2011 -12 - Rs. 90.52 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 53.27 lacs (2011-12 - Rs. 28.32 lacs) has been included in fixed assets.

5. Parties covered under "The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Nil (2011-12 - Nil). Further no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.

6. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notified under the Companies (Accounting Standards) Rules, 2006, the Company''s business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yam, cord, fabric etc.) and Chemicals (comprising Organics & fine Chemicals).

B. Geographical segments

The Company''s geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of notes forming part of the financial statement, the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include aU operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities allocable to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and.expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

ivy Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

7. Related party disclosures under Accounting Standard (AS)18 A. Names of related party and nature of related party relationship

Subsidiary: Daurala Foods & Beverages Private Limited (DFBPL)

Associate: DCM Hyundai Limited (DHL).

Key management personnel : Mr. Tilak Ohar, Mr. Alok B. Shriram, Mr. D.C. Mittal, Mr. Madhav B. Shriram and Mr. Anil Gujral.

Relatives/HUF of key management personnel: Mrs. Karuna Shriram, Mrs. Kiran Mittal, Mr. Akshay Dhar, Ms. Kanika Shriram (w.e.f. 03/10/11), M/s. Bansi Dhar & Sons - HUF (BDS), Mrs. Divya Shriram, Ms. Aditi Dhar and Ms. Ftitu Bansal.

Others (Enterprise over which key management personnel or their relatives are able to exercise significant influence): Bantam Enterprises Private Limited (BEPL) and H.R. Travels Private Limited (HRTPL).

8. The Company does not have any Finance Lease. Disclosures in respect of assets taken on Operating Lease under Accounting Standard (AS) 19 "Leases" is as under:

i) The Company has entered into operating leases agreements for various premises taken for accommodation of Company''s officers / directors and various offices of the Company. As at March 31,2013 the future minimum lease payments under non- cancellable period which is not later than one year are Rs. 58.64 lacs (2011-12 Nil).

ii) Lease rent charged to the Statement of Profit & Loss relating to operating leases entered or renewed after April 1, 2001 are Rs. 448.85 lacs (2011-12 - Rs. 447.66 lacs).

9. A Petition filed by a shareholder before the Hon''ble Company Law Board (CLB) u/s 397/398 of the Companies Act in November 2007, challenging the preferential issue of equity warrants by the Company, is pending.

10. The Company had in earlier year accounted for cane purchases for crushing season 2007-08 at a price of Rs. 110 per qtl in terms of the interim Order passed by the Hon''ble Supreme Court as against the State Advised Price of Rs. 125 per qtl. Pursuant to Hon''ble Supreme Court''s Order dated 17.1.2012, the differential cane price liability of Rs. 1875.06 lacs has been accounted for during 2011-12 under exceptional item.

11. Employee benefits

a) Defined contribution plans

Rs. 512.86 lacs (2011-12 - Rs. 480.60 lacs) for provident fund contribution and Rs. 186.09 lacs {2011-12 - Rs. 133.92 lacs) for superannuation fund contribution have been charged to the statement of profit and loss account. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

12. Previous year''s figures have been regrouped/ recast wherever necessary to correspond with the current year''s classification/ disclosures.

Mar 31, 2012

I. Debentures

Nil (2010-11 - 8,98,000) privately placed 12.50% secured redeemable non convertible debentures of Rs.100 each allotted w.e.f. June 18, 2001, redeemable at par in 26 equal quarterly instalments commencing from April 15, 2005. The instalments due for redemption have been redeemed. These debentures were secured by a first mortgage over all the immovable properties and a first charge by way of hypothecation of all the movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, both present and future (save and except book debts), subject to prior charges created / to be created in favour of the Company's bankers for securing borrowings for working capital requirements, the charges ranking pari-passu with the mortgages and charges created / to be created in favour of existing first charge holders for their respective term loans/debentures. These debentures were also secured by second charge on current assets of the Company excluding those of Daurala Organics, a unit of the Company.

II. Banks

a) Nil (2010-11 - 125.00 lacs), Rs.60.74 lacs (2010-11 - Rs.182.74 lacs), Rs.777.68 lacs (2010-11 - Rs.1222.16 lacs), Rs.700.00 lacs (2010-11 - Rs.1500 lacs), Rs.1857.00 lacs (2010-11 - Rs.2000.00 lacs), Rs.1800.00 lacs (2010-11 - Rs.2000.00 lacs) and Rs.2500.00 lacs (2010-11 - Nil) currently carrying interest between 12% to 14.50% and repayable in 0, 2, 7, 4, 13, 9 and 16 quarterly instalments respectively are secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans / debentures.

b) Rs.1083.64 lacs (2010-11 - Nil) carrying interest of 12.50% and repayable in 17 quarterly instalments is secured by first pari-passu charge on entire fixed assets of the Company, both present and future, excluding the assets exclusively charged and those pertaining to Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created / to be created in favour of existing first charge holders for their respective term loans / debentures. Also exclusive charge on assets to be acquired in Daurala Organics, a unit of the Company.

c) Rs.183.40 lacs (2010-11 - Rs.366.72 lacs), Rs.114.22 lacs (2010-11 - Rs.205.90 lacs), Rs.570.00 lacs (2010-11 - Rs.300.00 lacs) and Rs.465.00 lacs (2010-11 - Nil) currently carrying interest between 8.75 % to 13.25% (net of interest subvention) and repayable in 4, 5, 19 and 20 quarterly instalments respectively are secured by first charge on specific movable assets of Shriram Rayons, a unit of the Company.

d) Rs.382.11 lacs (2010-11 - Rs.446.92 lacs) currently carrying interest of 8.50% (net of interest subvention) repayable in 14 quarterly instalments is secured by first mortgage and charge on specific immovable and movable assets of Shriram Rayons, a unit of the Company.

e) Rs.441.00 lacs (2010-11 - Rs.561.00 lacs) currently carrying interest of 14.25% and repayable in 15 quarterly instalments is secured by a first mortgage and charge on all the immovable and movable properties (save and except book debts) of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans.

f) Rs.32.13 lacs (2010-11 - Rs.962.47 lacs) carrying Nil rate of interest (net of interest subvention) and repayable in 2 monthly instalments is secured by residual charge on fixed assets of sugar division of the Company.

g) Rs.2.53 lacs (2010-11 - Rs.7.19 lacs) carrying interest between 10% to 13% and repayable in 14 monthly instalments are secured by hypothecation of specific assets.

III. Others

a) Nil (2010-11 - Rs.139.72 lacs) was secured by a first mortgage and charge on all the immovable and movable properties of the Company excluding all assets of Daurala Organics, a unit of the Company, subject to prior charges created / to be created in favour of the Company's bankers for securing the borrowings for working capital requirements, the charges ranking pari-passu with the charges created/to be created in favour of existing first charge holders for their respective term loans / debentures. This was further secured by second charge on current assets of the Company excluding those of Daurala Organics, a unit of the Company.

b) Rs.1804.94 lacs (2010-11 - Rs.1804.94 lacs) carrying interest of 4% and repayable in 5 yearly instalments is secured by exclusive second charge on immovable and movable assets of sugar factory at Daurala Sugar Works, a unit of the Company.

1. a) Pursuant to the Scheme of Arrangement as approved by the High Court of Delhi vide its Order dated April 16, 1990 under sections 391 / 394 of the Companies Act, 1956, assets and liabilities relating to certain units, and certain reserves of the undivided DCM Limited were transferred / allocated to the Company w.e.f. April 1, 1990, being the effective date. The excess of net assets acquired over the share capital and reserves had been transferred to the securities premium account.

b) There are various issues relating to sales tax, income-tax, interest, etc. arisen / arising out of the reorganisation arrangement which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited as and when the liabilities / benefits are finally determined. The ultimate effect of these is not ascertainable at this stage.

As at As at 31.03.2012 31.03.2011

2. Contingent liabilities not provided for :- (Rs. lacs) (Rs. lacs)

Income tax matters* 1661.60 193.40

Excise / Service tax / Customs duty matters* 734.79 928.61

Claims against the Company not acknowledged as debts (excluding claims by employees, where amount is not ascertainable)* 1025.54 1088.51

Bills discounted 2336.53 1422.50

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

3. a) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) is Rs.104.02 lacs (2010-11-Rs.177.83 lacs).

b) The Company has other commitments, for purchase / sales orders which are issued after considering requirements per operating cycle for purchase / sale of goods and services, employee's benefits including union agreement in normal course of business. The Company does not have any long term commitments or material non-cancellable contractual commitments / contracts, which might have material impact on the financial statements.

4. Due to loss suffered in the year 2011-12, remuneration paid to one of the managerial personnel for the said year as minimum remuneration, has exceeded by Rs. 8.07 lacs and the same is subject to the approval of the shareholders at the ensuing Annual General Meeting as required under para 1(B) of part II of Section II of Schedule XIII to the Act.

5. Research and development expenses amounting to Rs. 90.52 lacs (2010-11 - Rs. 29.65 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 28.32 lacs (2010-11 - Rs. 14.65 lacs) has been included in fixed assets.

6. Parties covered under "The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is Nil (2010-11 - Rs. 1.93 lacs). Further no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.

7. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notified under the Companies (Accounting Standards) Rules, 2006, the Company's business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fine Chemicals).

B. Geographical segments

The Company's geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of notes forming part of the financial statements, the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities allocable to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

8. Related party disclosures under Accounting Standard (AS)18 A. Names of related party and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Private Limited (DFBPL)

Associate : DCM Hyundai Limited (DHL).

Key management personnel : Mr. Tilak Dhar, Mr. Alok B. Shriram, Mr. D.C. Mittal, Mr. Madhav B. Shriram, Mr. G. Kumar (upto 31/01/11) and Mr. Anil Gujral (w.e.f. 1/02/11).

Relatives/HUF of key management personnel : Mrs. Karuna Shriram, Mrs. Kiran Mittal, Mr. Akshay Dhar, Ms. Kanika Shriram (w.e.f. 3/10/11), M/s. Bansi Dhar & Sons - HUF (BDS), Mrs. Divya Shriram, Ms. Aditi Dhar and Ms. Ritu Bansal.

Others (Enterprises over which key management personnel or their relatives are able to exercise significant influence) : Bantam Enterprises Private Limited (BEPL) and H.R. Travels Private Limited (HRTPL).

* Does not include provision for leave salary and contribution / provision towards gratuity, since the contribution /provision is made for the Company as a whole on actuarial basis.

# Refer note 34

9. The Company does not have any Finance Lease. Disclosures in respect of assets taken on Operating Lease under Accounting Standard (AS) 19 "Leases" are as under :

i) The Company generally enters into cancellable operating leases for office premises and residence of its employees, normally renewable on expiry.

ii) Lease rent charged to the profit and loss account relating to operating leases entered or renewed after April 1, 2001 is Rs. 447.66 lacs (2010-11 - Rs. 419.51 lacs).

10. A Petition filed by a shareholder before the Hon'ble Company Law Board (CLB) u/s 397/398 of the Companies Act in November 2007, challenging the preferential issue of equity warrants by the Company, is pending.

11. The Company had in earlier year accounted for cane purchases for crushing season 2007-08 at a price of Rs. 110 per qtl in terms of the interim Order passed by the Hon'ble Supreme Court as against the State Advised Price of Rs. 125 per qtl. Pursuant to Hon'ble Supreme Cout's Order dated 17.1.2012, the differential cane price liability of Rs. 1875.06 lacs has been accounted for during the year under exceptional item.

12. Employee benefits

a) Defined contribution plans

Rs. 480.60 lacs (2010-11 - Rs. 477.80 lacs) for provident fund contribution and Rs. 133.92 lacs (2010-11 - Rs. 166.58 lacs) for superannuation fund contribution have been charged to the statement of profit and loss account. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of provident fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, privilege leaves and medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

13. The Revised Schedule - VI has become effective from April 1, 2011 for the preparation of financial statements. Pursuant to the same, the required changes in presentation and disclosures have been incorporated in these financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosures.

Mar 31, 2011

1. a) Pursuant to the Scheme of Arrangement as approved by the High Court of Delhi vide its Order dated April 16, 1990 under sections 391 / 394 of the Companies Act, 1956, assets and liabilities relating to certain units, and certain reserves of the undivided DCM Limited were transferred /allocated to the Company w.e.f. April 1, 1990, being the effective date. The excess of net assets acquired over the share capital and reserves had been transferred to the share premium account.

b) There are various issues relating to sales tax, income-tax, interest, etc. arisen / arising out of the reorganisation arrangement which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited as and when the liabilities / benefits are fnally determined. The ultimate effect of these is not ascertainable at this stage.

As at As at

31.03.2011 31.03.2010

2. Contingent liabilities not provided for:- (Rs. lacs) (Rs. lacs) Income tax matters* 193.40 210.22

Excise / Service tax / Customs Duty matters* 928.61 698.39

Claims against the Company not acknowledged as debts (excluding claims by employees, where amount is not ascertainable)* 1088.51 1000.34

Bills discounted 1422.50 2540.73

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

3. Research and development expenses amounting to Rs. 29.65 lacs (2009-10 - Rs. 33.53 lacs) have been charged to the respective revenue accounts. Capital expenditure relating to research and development amounting to Rs. 14.65 lacs (2009-10 Ã Nil) has been included in fixed assets.

4. Parties covered under "The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identifed on the basis of confrmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as Defined under the MSMED Act, 2006 is Rs. 1.93 lacs (2009-10 Nil). Further no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.

5. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notifed under the Companies (Accounting Standards) Rules, 2006, the Companys business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fne Chemicals).

B. Geographical segments

The Companys geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the signifcant accounting policies applicable to the segments as set out in note 1 of schedule 11 "Notes to the Accounts", the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax- current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

6. Related party disclosures under Accounting Standard (AS)18 A. Names of related party and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Pvt. Ltd. (DFBPL)

Associate : DCM Hyundai Ltd. (DHL)

Key management personnel :

Mr. Tilak Dhar,

Mr. Alok B. Shriram,

Mr. D.C. Mittal,

Mr. Madhav B. Shriram,

Mr. G. Kumar (upto 31/01/11) and Mr. Anil Gujral (w.e.f. 1/02/11).

Relatives/HUF of key management personnel : Mrs. Karuna Shriram, Mrs. Kiran Mittal, Mr. Akshay Dhar and M/s. Bansi Dhar & Sons - HUF (BDS).

Others (Enterprise over which key management personnel or their relatives are able to exercise signifcant infuence) : Bantam Enterprises Pvt. Ltd. (BEPL) and H.R. Travels Pvt. Ltd. (HRTPL).

11. Disclosures in respect of assets taken on lease under Accounting Standard (AS) 19 "Leases".

A. Finance Lease

i) For motor vehicles and plant and machinery taken under fnance lease arrangements, the ownership will be transferred to the Company at the end of the fnance lease term.

B. Operating Lease

i) The Company generally enters into cancellable operating leases for office premises and residence of its employees, normally renewable on expiry.

ii) Lease rent charged to the Profit and loss account relating to operating leases entered or renewed after April 1, 2001 are Rs. 419.51 lacs (2009-10 - Rs. 401.34 lacs).

7. A Petition fled by a shareholder before the Honble Company Law Board under Section 397 / 398 of the Companies Act in November 2007, challenging the preferential issue of equity warrants by the Company, is pending. The same shareholder also fled a Civil Suit challenging some of the items in the Agenda for the Annual General Meeting (AGM) held on 25.9.2008 before the Honble Delhi High Court. The said Suit was dismissed by the Honble Delhi High Court by its Order dated 25.8.2009. Subsequently, the shareholder fled an appeal against the Order before the Division Bench. The Division Bench by its Order dated 25.5.2010 declined to interfere with the Order of the learned Single Judge

8. The Company has accounted for cane purchases for crushing season 2007-08 at a price of Rs. 110 per qtl in terms of the interim Order passed by the Honble Allahabad High Court. Subsequently the Honble High Court passed fnal Order directing sugar mills to pay State Advised Price at Rs 125 per qtl. Appeal against the Order of the Honble High Court has been fled with the Honble Supreme Court which has directed to pay Rs. 110 per qtl as interim arrangement. Necessary adjustments, if any, will be made in accordance with the fnal Order of the Honble Supreme Court

9. Employee benefits

a) Defined contribution plans

Rs. 477.80 lacs (previous year Rs. 397.72 lacs) for provident fund contribution and Rs. 166.58 lacs (previous year Rs. 155.91 lacs) for superannuation contribution have been charged to the Profit and loss account. The contributions towards these schemes are at rates specifed in the rules of the schemes. In case of Provident Fund administered through a trust, shortfall if any, shall be made good by the Company

b) Defined benefit plans

i) Liability for gratuity, Privilege leaves and Medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of fve years of service, except death while in employment

10. The Company had impaired certain plant & machinery in the previous year based on net realizable value of such assets determined by an independent valuer. The impairment loss was recognised at Rs. 127.14 lacs out of which Rs. 27.99 lacs was adjusted from revaluation reserve being revaluation amount included in carrying value of these assets and the resultant loss (Gross - Rs. 99.15 lacs, net of deferred taxes Rs. 66.21 lacs) was included in Schedule 9- Manufacturing and Other Expenses

11. Previous year figures have been regrouped / recast, wherever necessary

12. Schedules 1 to 11 and the statement of additional information form an integral part of the balance sheet and Profit and loss account.

Mar 31, 2010

1.a) Pursuant to the Scheme of Arrangement as approved by the High Court of Delhi vide its Order dated April 16, 1990 under sections 391 / 394 of the Companies Act, 1956, assets and liabilities relating to certain units, and certain reserves of the undivided DCM Limited were transferred / allocated to the Company w.e.f. April 1,1990, being the effective date. The excess of net assets acquired over the share capital and reserves had been transferred to the share premium account.

b) There are various issues relating to sales tax, income-tax, interest, etc. arisen / arising out of the reorganisation arrangement which will be settled and accounted for in terms of the Scheme of Arrangement of DCM Limited as and when the liabilities / benefits are finally determined. The ultimate effect of these is not ascertainable at this stage.

As at As at 31.03.2010 31.03.2009

Contingent liabilities not provided for:- (Rs. lacs) (Rs. lacs)

Income tax matters* 210.22 196.70

Excise / Service tax / Customs Duty matters* 698.39 665.93

Claims against the Company not acknowledged as debts (excluding claims by employees, where amount is not ascertainable)* 1000.34 842.95

Bills discounted 2540.73 1718.04

* Matters are subject to legal proceedings in the ordinary course of business. The legal proceedings, when ultimately concluded will not, in the opinion of the management, have a material effect on the results of the operations or financial position.

3. Research and development expenses amounting to Rs. 33.53 lacs (2008-09 - Rs. 45.77 lacs) have been charged to the respective revenue accounts.

4. Parties covered under The Micro, Small and Medium Enterprise Development Act, 2006" (MSMED Act, 2006) have been identified on the basis of confirmation received.

Based upon the information available, the balance due to the Micro and Small Enterprises as defined under the MSMED Act, 2006 is nil. Further no interest during the year has been paid or payable under the terms of the MSMED Act, 2006.

5. Segment reporting

A. Business segments

Based on the guiding principles given in Accounting Standard (AS) 17 "Segment Reporting" as notified under the Companies (Accounting Standards) Rules, 2006, the Companys business segments are Sugar (comprising sugar, power and molasses based alcohols), Industrial Fibres and related products (comprising rayon, synthetic yarn, cord, fabric etc.) and Chemicals (comprising Organics & fine Chemicals).

B. Geographical segments

The Companys geographical segments are Domestic and Overseas, by location of customers.

C. Segment accounting policies

In addition to the significant accounting policies applicable to the segments as set out in note 1 of schedule 11 "Notes to the Accounts", the accounting policies in relation to segment accounting are as under :-

i) Segment assets and liabilities

Segment assets include all operating assets used by a segment and consist principally of operating cash, debtors, inventories and fixed assets, net of allowances and provisions which are reported as direct offsets in the balance sheet. Segment liabilities include all operating liabilities and consist principally of creditors and accrued liabilities. Segment assets and liabilities do not include investments, share capital, reserves and surplus, loan funds, income tax - current and deferred and certain other assets and liabilities not allocable to the segments on a reasonable basis. While most of the assets/liabilities can be directly attributed to individual segments, the carrying amount of certain assets/liabilities to two or more segments are allocated to the segments on a reasonable basis.

ii) Segment revenue and expenses

Joint revenue and expenses of segments are allocated amongst them on a reasonable basis. All other segment revenue and expenses are directly attributable to the segment.

iii) Unallocated expenses

Unallocated expenses represent general administrative expenses, head-office expenses and other expenses that arise at the Company level and relate to the Company as a whole. As such, these expenses have not been considered in arriving at the segment results.

iv) Inter segment sales

Inter segment sales between operating segments are accounted for at market price. These transactions are eliminated in consolidation.

6. Related party disclosures under Accounting Standard (AS)18

A. Names of related party and nature of related party relationship

Subsidiary : Daurala Foods & Beverages Pvt. Ltd. (DFBPL)

Associates : DCM Hyundai Ltd. (DHL).

Key management personnel: Mr. Tilak Dhar, Mr. Alok B. Shriram, Mr. D.C. Mittal, Mr. Madhav B. Shriram and Mr. G. Kumar.

Relatives/HUF of key management personnel : Mrs. Karuna Shriram, Mrs. Kiran Mittal, Mrs. Manju Kumar, Mr. Akshay Dhar and M/s. Bansi Dhar & Sons - HUF (BDS).

Others (Enterprise over which key management personnel or their relatives are able to exercise significant influence): Hindustan Vacuum Glass Pvt. Ltd. (HVGPL) and Bantam Enterprises Pvt. Ltd. (BEPL).

B. Transactions with related parties referred to in 10 (A) i) Transactions with subsidiary and associates

B. Operating Lease

i) The Company generally enters into cancellable operating leases for office premises and residence of its employees, normally renewable on expiry.

ii) Lease rent charged to the profit and loss account relating to operating leases entered or renewed after April 1, 2001 are Rs. 401.34 lacs (2008-09 - Rs. 447.63 lacs).

7. A Petition filed by a shareholder before the Honble Company Law Board under Section 397 / 398 of the Companies Act in November 2007, challenging the preferential issue of equity warrants by the Company, is pending. The same shareholder also filed a Civil Suit challenging some of the items in the Agenda for the Annual General Meeting (AGM) held on 25.9.2008 before the Honble Delhi High Court. The said Suit was dismissed by the Honble Delhi High Court by its Order dated 25.8.2009. Subsequently, the shareholder filed an appeal against the Order before the Division Bench. The Division Bench by its Order dated 25.5.2010 declined to interfere with the Order of the learned Single Judge.

8. The Company has accounted for cane purchases for crushing season 2007-08 at a price of Rs. 110 per qtl in terms of the interim Order passed by the Honble Allahabad High Court. Subsequently the Honble High Court passed final Order directing sugar mills to pay State Advised Price at Rs. 125 per qtl. Appeal against the Order of the Honble High Court has been filed with the Honble Supreme Court which has directed to pay Rs. 110 per qtl as interim arrangement. Necessary adjustments, if any, will be made in accordance with the final Order of the Honble Supreme Court.

9. Employee benefits

a) Defined contribution plans

Rs. 397.72 lacs (previous year Rs. 364.65 lacs) for provident fund contribution and Rs. 155.91 lacs (previous year Rs. 137.91 lacs) for superannuation contribution have been charged to the profit and loss account. The contributions towards these schemes are at rates specified in the rules of the schemes. In case of Provident Fund administered through a trust, shortfall if any, shall be made good by the Company.

b) Defined benefit plans

i) Liability for gratuity, Privilege leaves and Medical leaves is determined on actuarial basis. Gratuity liability is provided to the extent not covered by the funds available in the gratuity fund.

ii) Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

10. The Company has impaired certain plant & machinery based on net realizable value of such assets determined by an independent valuer. The impairment loss has been recognised at Rs. 127.14 lacs out of which Rs. 27.99 lacs has been adjusted from revaluation reserve being revaluation amount included in carrying value of these assets and the resultant loss (Gross - Rs. 99.15 lacs, net of deferred taxes Rs. 66.21 lacs) has been included in Schedule 9- Manufacturing and Other Expenses.

11. Previous year figures have been regrouped / recast, wherever necessary.

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