INFORMATION MEMORANDUM

ZUARI AGRO CHEMICALS LIMITED (Formerly known as Zuari Holdings Limited) Zuari Agro Chemicals Limited (Company) was incorporated on 10th September, 2009under the Companies Act, 1956 (Companies Act). The corporate identification number assigned to our Company is U65910GA2009PLC006177. Registered Office: Jai Kisaan Bhawan, Zuarinagar, Goa-403726, Tel: (0832) 2592180, 2592181 Corporate Office: Global Business Park, Tower A, 5th Floor, M.G. Road, Gurgaon 122002, Haryana, Website: www.zuari.in Compliance Officer & Contact Person: Mr. R.Y. Patil, Chief General Manager & Company Secretary Phone: (0832) 2592180, 2592181, Fax: (0832) 2555279, Email-id: ryp@zuari.adventz.com Information memorandum for the listing of 42,058,006 Equity Shares of Rs. 10 each fully paid up pursuant to the Scheme of Arrangement and Demerger NO EQUITY SHARES ARE PROPOSED TO BE SOLD OR OFFERED PURSUANT TO THIS INFORMATION MEMORANDUM FOR PRIVATE CIRCULATION TO THE EQUITY SHAREHOLDERS OF THE COMPANY GENERAL RISKS Investment in equity and equity related securities, involves a degree of risk and investors should not invest any funds in the equity shares of the Company unless they can afford to take the risk of losing their investment. Investors are advised to read the risk factors carefully before taking a decision of investing in the equity shares of the Company. For taking an investment decision, investors must rely on their own examination of the Company, including the risks involved. The securities have not been recommended or approved by Securities and Exchange Board of India (SEBI) nor does SEBI guarantee the accuracy or adequacy of this Information Memorandum. Specific attention of investors is invited to the Section titled Risk Factors in this Information Memorandum. ISSUERS ABSOLUTE RESPONSIBILITY The Company, having made all reasonable inquiries, accepts responsibility for and confirms that this Information Memorandum contains all information with regard to the Company, which is material, that the information contained in this Information Memorandum is true and correct in all material respects, that the opinions and intentions expressed herein are honestly held and that there are no other facts, the omission of which makes this Information Memorandum as a whole or any of such information or the expression of any such opinions or intentions misleading in any material respect. LISTING ARRANGEMENT The Equity Shares of the Company are proposed to be listed on the BSE Limited (BSE), and the National Stock Exchange of India Limited (NSE). The Company has submitted this Information Memorandum with BSE and NSE and the same has been made available on the Companys website viz. www.zuari.in. The Information Memorandum would also be made available on the website of BSE (www.bseindia.com) and NSE (www.nseindia.com). REGISTRAR AND SHARE TRANSFER AGENT

LINK INTIME INDIA PRIVATE LIMITED C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (West), Mumbai 400 078 Tel: (91 22) 2596 3838 Fax: (91 22) 2596 0329 Website: www.linkintime.co.in E-mail: rnt.helpdesk@linkintime.co.in Investor Grievance Email: rnt.helpdesk@linkintime.co.in Contact Person: N Mahadevan Iyer SEBI Registration No.: INR000004058

Table of Contents

Sr. No. I II III IV V VI VII VIII IX X XI XII XIII XIV XV XVI XVII

Particulars Definitions & Abbreviations Risk Factors General Information Capital Structure Objects And Rationale Of The Scheme Salient Features Of The Scheme Statement Of Possible Tax Benefits Company History & Management Overview Of Organisation Structure Promoter, Promoter Group and Subsidiary Companies and Companies Under Same Management Industry Overview Our Business Financial Statements Managements Discussion and Analysis Outstanding Litigations, Defaults And Material Developments Articles Of Association Documents For Inspection

Page No. 3 7 17 22 37 39 43 58 71 72 111 114 116 117 120 190 246 247

DECLARATION

I: DEFINITIONS & ABBREVIATIONS COMPANY / INDUSTRY RELATED TERMS Term Zuari Global Limited or ZGL or ZIL Articles / Articles of Association Board of Directors / Board Demerged Undertaking Demerger Appointed Date Effective Date Equity Share(s) or Share(s) Group Companies Information Memorandum ZACL or Company or Our Company or we or us or our or ZHL Listing Agreements Memorandum/ Memorandum of Association Orders Description Zuari Global Limited (formerly known as Zuari Industries Limited), a public limited company having its registered office at Jai Kisaan Bhawan, Zuarinagar, Goa-403726 Articles of Association of our Company Board of Directors of the Company Demerged Undertaking shall have the meaning ascribed to such term in Scheme of Arrangement and Demerger 1st July, 2011 Date of filing the Orders along with Form 21 with Registrar of Companies, i.e., 21st March, 2012 Equity Share of our Company having a face value of `10/unless otherwise specified in the context thereof Group Companies of our Company as listed in Promoters and Group Companies This document filed with the Stock Exchanges is known as and referred to as the Information Memorandum. Zuari Agro Chemicals Limited (formerly known as Zuari Holdings Limited), a public limited company having its registered office at Jai Kisaan Bhawan, Zuarinagar, Goa403726 The listing agreement to be entered into between our Company and the Stock Exchanges Memorandum of Association of the Company Orders of the Honble High Court of Bombay at Goa dated 2nd March, 2012, approving the Scheme, and filed with the RoC on 21st March, 2012 Promoter Group as defined in Promoter, Promoter Group and Subsidiary Companies and Companies Under Same Management Zuari Global Limited (Formerly known as Zuari Industries Limited) Zuari Global Limited (Formerly known as Zuari Industries Limited) Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited) 10th April, 2012

Promoter Group Promoters Transferor Company Transferee Company Record date

Term Registrar and Share Transfer Agents RoC Scheme Statutory Auditor Stock Exchanges

Description Link Intime India Private Limited The Registrar of Companies of Goa located at Company Law Bhawan, EDC Complex, Plot No. 21, Patto, Panaji - 403001 Scheme of Arrangement and Demerger dated 14th July, 2011 S. R. Batliboi & Co. NSE and BSE

CONVENTIONAL / GENERAL TERMS AND ABBREVIATIONS

COMPANY / INDUSTRY RELATED TERMS Term Articles / Articles Association / AOA Board / Board of Directors BSE BTU Committee of Directors CDSL DP Memorandum / MOA MOP MT NBS NSDL NSE Registered Office SCRR SEBI USD of Description Articles of Association of the Issuer, as amended M/s. S.R. Batliboi & Co The Board of Directors of the Issuer BSE Limited British Thermal Units The Committee of Directors of the Issuer Central Depository Services Limited Depository Participant Memorandum of Association of the Issuer, as amended Muriate of Potash Metric Tonne Nutrient Based Subsidy National Securities Depository Limited National Stock Exchange of India Limited Jai Kisaan Bhawan, Zuarinagar, Goa-403726 Securities Contracts (Regulations) Rules, 1957 Securities and Exchange Board of India United States Dollar, the official currency of the United States of America

Auditors / Statutory Auditors

In the Information Memorandum all reference to ` refer to Rupees, the lawful currency of India, reference to one gender also refers to another gender and the word Lakh or Lac means one hundred thousand and the word million means ten lacs and the word crore means ten million. Certain Conventions; Use of Market Data Unless stated otherwise, the financial data in this Information Memorandum is derived from our restated financial statements. The fiscal year commences on April 1 and ends on March 31 of each year, so all references to a particular fiscal year are to the twelve month period ended March 31 of that year. In this Information Memorandum, any discrepancies in any table between the total and the sums of the amounts listed are due to rounding. All references to India contained in this Information Memorandum are to the Republic of India. All references to Rupees or ` are to Indian Rupees, the official currency of the Republic of India. For additional definitions, please see the section titled Definitions, Abbreviations and Industry Related Terms of this Information Memorandum. Unless stated otherwise, industry data used throughout this Information Memorandum has been obtained from the published data and industry publications. Industry publications generally state that the information contained in those publications has been obtained from sources believed to be reliable but that their accuracy and completeness are not guaranteed and their reliability cannot be assured. Although we believe that industry data used in this Information Memorandum is reliable, it has not been independently verified. The information included in this Information Memorandum about various other Companies is based on their respective Annual Reports and information made available by the respective companies. Forward-Looking Statements We have included statements in this Information Memorandum which contain words or phrases such as will, aim, will likely result, believe, expect, will continue, anticipate, estimate, intend, plan, contemplate, seek to, future, objective, goal, project, should, will pursue and similar expressions or variations of such expressions, that are forward looking statements. Similarly, statements that describe our objectives, plans or goals also are forward-looking statements, actual results may differ materially from those suggested by the forward looking statements due to risks or uncertainties associated with our expectations with respect to, but not limited to: General economic and business conditions in India and other countries; Regulatory changes and our ability to respond to them; Our ability to successfully implement our strategy, our growth and expansion plans; Technological changes;

Our exposure to market risks, general economic and political conditions in India which have an impact on our business activities or investments; The monetary and fiscal policies of India, inflation, deflation, unanticipated turbulence in interest rates, foreign exchange rates, equity prices or other rates or prices, the performance of the financial markets in India and globally; Changes in domestic and foreign laws, regulations and taxes and changes in competition in our industry

For further discussion of factors that could cause our actual results to differ, see the section titled Risk Factors of this Information Memorandum. By their nature, certain market risk disclosures are only estimates and could be materially different from what actually occurs in the future. As a result, actual future gains or losses could materially differ from those that have been estimated. We do not have any obligation to, and do not intend to, update or otherwise revise any statements reflecting circumstances arising after the date hereof or to reflect the occurrence of underlying events, even if the underlying assumptions do not materialize.

II - RISK FACTORS The following is the summary of the risk factors. The more detailed information about the Company and its financial statements has been included elsewhere in this Information Memorandum. Unless specified or quantified in the relevant risk factors below, the Company is not in a position to quantify the financial or other implication of any of the risks described in this Section. The numbering of the risk factors has been done to facilitate ease of reading and reference and does not in any manner indicate the importance of one risk over another. An investment in equity shares involves a high degree of risk. The investor should carefully consider all the information in this Information Memorandum including the risks and uncertainties mentioned below. If any of the following risks actually occur, the business, financial condition and operations of the Company could suffer, the trading price of the Equity Shares could decline and the investor may lose all or part of their investments. MATERIALITY The Risk Factors have been determined on the basis of their materiality. The following factors have been considered for determining the materiality: Some events may not be material individually but may be found material collectively. Some events may have material impact qualitatively instead of quantitatively. Some events may not be material at present but may be having material impact in future. The risk factors are as envisaged by the management along with the proposals to address the risk if any. INTERNAL RISK FACTORS Risk factors related to our Company and Business 1. Our Company may be involved in legal proceedings in various states in India, both as plaintiff and as defendant, in which we may not prevail. Pursuant to the clause 13 of the Scheme of Arrangement and Demerger, all legal and other proceedings by or against Zuari Global Limited ( formerly known as Zuari Industries Limited) and relating to the Fertiliser Undertaking shall be continued and enforced by or against Zuari Agro Chemicals Limited (formerly known as Zuari Holdings Limited) only. If proceedings are taken against Zuari Global Limited, Zuari Global Limited will defend on notice as per advice of Zuari Agro Chemicals Limited at

the costs of Zuari Agro Chemicals Limited and Zuari Agro Chemicals Limited will indemnify and keep indemnified Zuari Global Limited from and against all liabilities, obligations, actions, claims, and demands in respect thereof. There are certain claims pending against us, which are discussed elsewhere in the Information Memorandum. Some of these actions against us may result in financial Settlements and penalties that may affect our earnings. If we are sued by our customers or end users in case of any defects in our Fertilisers, our reputation and business may be adversely affected. For further details, kindly refer to the section titled Outstanding Litigations, Defaults And Material Developments. 2. Our sales are to a large extent dependent on the overall area under cultivation and the cropping pattern adopted by the farming community in India The Company has taken over the Fertilizer Undertaking of the Zuari Industries Limited(now Zuari Global Limited) pursuant to Demerger scheme approved by the High Court of Bombay at Goa. The Company shall derive profits primarily from sales of Urea, Diammonium phosphate (DAP), Muriate of Potash (MOP) and NP/NPK Complex in various parts of India. Any significant reduction (10% or more) in the area under cultivation or any shortfall of rainfall may significantly reduce the demand for our Fertilisers. Also the demand of our Fertilisers is dependent on the cropping pattern which may vary year on year for the major crops. Any significant changes in the cultivable area, rain distribution and the cropping pattern in India may impact our sales and profitability. Fortunes of the fertilizer industry as a whole depend on the status of the agriculture sector which in turn depends on the adequacy of monsoons. Erratic or inadequate monsoons could have an adverse impact on the fertilizer industry and the Company. 3. Regulated industry and grant of Subsidies by the Government Fertilizer industry is a regulated Industry in India. The Maximum Retail Price as well as subsidy on fertilizers is dependent on Government regulations (policies vary on the type of Fertilser). Any change in the Government policies with respect to fertilizers and allied agro products especially covered under the subsidy scheme may affect the companys sales and profitability. Urea is presently under the Retention Pricing Scheme, whereby the urea manufacturers get a specified return on the net worth. Decontrol of Urea could affect the fortunes of the fertilizer industry and the Company. In an endeavor to ensure a balanced use of fertilizers, the Government has introduced Nutrient Based Subsidy on DAP and other complex fertilizers.. Delay in

determination and receipt of subsidy from the Central Government may affect the profitability of the Company. 4. Manufacturing Facilities and smooth operations of Plant and ability to adapt to technological changes: The operation of the units may be disrupted for reasons that are beyond the control of the Company including explosions, fires, earthquakes and other natural disasters, breakdown, failure or substandard performance of equipment, improper installation or operation of equipment, accidents, operational problems, transportation interruptions, other environmental risks and labour disputes. In addition, the Company's projects may also be targets of terrorist attacks or other civil disturbances. Furthermore, the Company relies on extremely sophisticated and complex machinery that is built by third parties and may be susceptible to malfunction. The Company cannot assure that it will successfully implement new technologies effectively or adapt its systems to emerging industry standards. The loss of or shutdown of operations at companys manufacturing facility may have a material adverse effect on its business, financial condition and results of operations. The Companys operations could be adversely affected by strikes, work stoppages or increased wage demands by its employees. 5. Delay or non-receipt of relevant regulatory and' third party approvals may have an adverse effect on the operations and financial condition of the Company. As a result of the Scheme of Demerger approved by the High Court, the Company is required to transfer the assets, properties, contracts and licenses and permits forming part of the Demerged Undertaking, from Zuari Industries Limited (now Zuari Global Limited) in favour of the Company. Some of the consent s have been obtained and some are still pending. Any delay or non- receipt of these consents will hamper the operations of the Company and may have an adverse impact on the financial condition of the Company. 6. Our failure to obtain and renew Compliance requirements and regulatory approvals required for our business may be detrimental for our business. Most of Companys approvals for manufacturing process are valid for certain period and requires regular renewals. These renewals are required in ordinary course of business and are subject to compliances with various conditions stipulated in those approval/ Licenses. In case the Company is unable to get its licenses and approval

renewed in time the operation of the manufacturing facilities and marketing of the products may be hampered, which can affect its results of operations and financials. 7. Our inability to meet the quality norms prescribed by the Government. Quality of Fertilizer products manufactured in India is open to independent verification by Government agencies. Government agencies carry out surprise sample checking of Fertilisers for their contents / nutrients. In case, the content / nutrients in the sample does not comply with the quality norms prescribed by the Government, it could lead to issuance of show cause notices. Any failure on quality control by the Company could lead to suspension of sales of those batches and /or Fertilisers in that particular state or the Fertilisers manufactured by the company being totally banned for sales. 8. Risk on availability of raw material, transportation arrangements and Imports restrictions. The price and availability of imported raw materials for the manufacture of Phosphatic Fertilisers could affect the profitability of the Company. The Companys business may be adversely affected if it is unable to renew its contracts with raw material suppliers. The Companys business is dependent on continued availability of raw materials Naptha/LNG/Gas, phosphoric acid and Potash. Any interruption in the availability of the abovementioned or other raw materials may adversely affect Companys business, financial condition and results of operations. Similarly, in the event that suppliers face a plant shutdown or other problems which affect the continued supply of aforementioned raw materials to the Company, financial condition and results of operations may be adversely affected. 9. Risk in relation to usage of hazardous chemical / substances in our production The Company is exposed to risk of usage of hazardous chemicals in production. Any mishandling of hazardous chemicals / substances could lead to fatal accidents, which may affect its business operations. In order to prevent such mishandling the Company has established various measures including training of workers, no entry to production area without safety devices, prominent display of safety measures and precautionary measures in production area etc. Effluent water treatment plant has been installed and recycled water is used in processes / gardens in the precincts. Fresh air induction systems have been installed to create a better protection environment.

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10.

Environmental laws and regulations: Environmental laws and regulations in India are becoming stringent and it is possible that they will become significantly more stringent in the future. If, as a result of noncompliance with any environmental regulations, any heavy penalty is imposed on the Company or any of its units or the operations of such units are shut down, The Company will continue to incur costs in complying with these regulations, appealing against any decision to close its facilities, maintaining production at its existing facilities and continuing to pay labour and other costs which continue, even if the facility is closed. As a result, the Companys overall operating expenses will increase and its profits will decrease.

11.

Competition from other established companies and future entrants into the industry. The Company operates in the domestic market where it faces competition from other domestic players. Growing competition may force the Company to reduce the prices of its Fertilisers, which may reduce revenues and margins and/or decrease market share, either of which could impact results or operations.

12.

The insurance policies obtained by us may not be adequate to protect us against all potential losses, which we may be subject to in future. The Company has covered itself against majority of the risks. The Companys significant insurance policies consist of policies on Plant & Machinery, stocks of inventory and Employee group health schemes. In addition, it has obtained separate insurance coverage to cover terrorism risks. The Company will rely upon insurance coverage to insure against damage and loss to its plant that may occur during operation. Nevertheless, the insurance that the Company obtains may not be sufficient to protect it from all casualties and losses. Losses suffered due to inadequate coverage may have an adverse impact on the Company's business, financial condition and operations

13.

Availability of additional funds / working capital on unfavorable terms and conditions or Increase in interest rates The Company's business is capital intensive and the Company may plan to make additional capital expenditures to complete the projects that it is currently developing or that it may develop in the future. The Company's ability to pay dividends in the future will depend upon its future earnings, financial condition, cash flows, working

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capital requirements, capital expenditures and restrictive covenants in its financing arrangements. The Company's future dividend policy will depend on its capital requirements and financing arrangements for projects, financial condition, operations and Government of India policy. The Companys inability to get funds on acceptable term could impact its growth and profitability. 14. Risks of retention of manpower, Key Managerial persons or Increased cost of Manpower The Company is dependent on its non-executive Chairman, Mr. S.K. Poddar Mr. N. Suresh Krishnan, Managing Director, and a number of other key personnel, and the loss of such persons, or its inability to attract key personnel or retain them in the future, could adversely affect the Company. Companys sustained growth depends on our ability to attract and retain skilled manpower. Failure to attract and retain skilled manpower could adversely affect its growth strategy. Any significant changes in the key managerial personnel, may affect the performance of the Company. Also, Wage increases may reduce its profit margins and negatively impact the financial condition and results of operations of the Company. 15. Besides above, as a manufacturing company, the Company is subject to several risks, including: Ability to hire skilled labour; Issues in securing an adequate and uninterrupted supply of water, power for manufacturing operations and at cost-effective rates; and The occurrence of any of these events, individually or in aggregate, could have an adverse effect on the Company's business, prospects, financial condition and operations. External Risk factors 1. Certain factors beyond the control of our Company like floods, droughts, monsoons, etc. can adversely affect operations of our Company. Natural calamities like floods and droughts directly affect the cropping pattern in India, where agriculture is dependent on monsoon. To that extent Companys sales are dependent on the monsoon. Companys sales and profitability may be affected due to excessive rains or droughts, when the farmers do not undertake sowing.

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2.

Political, economic and social developments in lndia could adversely affect the Company's business, financial condition and operations The central and state governments serve multiple roles in the Indian economy, including those of producers, consumers and regulators, which have significant influence on the Fertiliser industry and the Company. Changes in these governmental policies could have a significant impact on the business and economic conditions in India in general and fertilizer Industry in particular, which in turn could adversely affect the Company's business, financial condition and operations. Additionally, any political instability in India and macro economic indicators may adversely affect the Indian securities markets in general, which could also adversely affect the trading price of the Equity Shares. Movement in the exchange rates of Indian Rupee against foreign currencies like US Dollar, Euro , Japanese Yen and other major foreign currencies can adversely impact the financials of the Company.

3.

Companies operating in India are subject to a variety of central and state government taxes and surcharges. Tax and other levies imposed by the central and state governments in India that affect the Company's tax liability include central and state taxes and other levies, income tax, value added tax, turnover tax, service tax, stamp duty and other special taxes and surcharges which are introduced on a temporary or permanent basis from time to time. Moreover, the central and state tax scheme in India is extensive and subject to change from time to time. For example, a new direct tax code is proposed to be introduced before the Indian Parliament. In addition, there is a proposal to introduce a new goods and services tax and the scope of the service tax is proposed to be enlarged. The central government may in the future increase the corporate income taxes they impose. Any such future increases or amendments may affect the overall tax efficiency of companies operating in India and may result in significant additional taxes becoming payable. Additional tax exposure could adversely affect the Company's business and operations.

4.

Change of Law: Rights of shareholders under Indian laws may be more limited than under the laws of other jurisdictions. The Companies Act and related regulations, the Listing Agreements and the AoA govern the Company's corporate affairs. Legal principles relating to these matters and the validity of corporate procedures, directors' fiduciary duties and liabilities and shareholders' rights may differ from those that would apply to a company in another jurisdiction. The rights of shareholders under Indian laws may not be as extensive as

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the rights of shareholders under the laws of other countries or jurisdictions. An investor may have more difficulty in asserting his rights as a shareholder of the Company than as a shareholder of a corporation in another jurisdiction. 5. A slowdown in the economic growth in India Any slowdown in the Indian economy or in the growth of the Fertiliser industry or any future volatility in global commodity prices could adversely affect the Company's customers and the growth of its business, which in turn could adversely affect its business, financial condition and operations. India's economy could be adversely affected by a general rise in interest rates, currency exchange rates and adverse conditions affecting agriculture, commodity and electricity prices or various other factors. Further, conditions outside India, such as slowdown in the economic growth of other countries could have an impact on the growth of the Indian economy and government policy may change in response to such conditions. 6. The extent and reliability of Indian infrastructure could adversely impact the Company's operations and financial condition. India's physical infrastructure is less developed than that of many developed nations. Any congestion or disruption with its port, rail and road networks, electricity grid, communication systems or any other public facility could disrupt the Company's normal business activity. Any deterioration of India's physical infrastructure would harm the national economy, disrupt the transportation of goods and supplies and add costs to doing business in India. These problems could interrupt the Company's business operations, which could have an adverse effect on its financial condition. 7. In case Inflation worsens, the Company's operations and financial condition may be adversely affected. India's wholesale price inflation index suggested an increasing inflation trend compared to recent years. An increase in inflation in India could cause a rise in the price of transportation, wages, raw materials or any other of the Company's expenses. If this trend continues, the Company may be unable to reduce its costs or pass its increased costs to its customers and its operations and financial condition may be adversely affected. 8. Terrorist attacks involving India, can adversely affect our business.

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Terrorist attacks and other acts of violence or war, including those involving India, or any other countries, may adversely affect Indian and worldwide financial markets. These acts may also result in a loss of business confidence and have other consequences that could adversely affect the Companys business, results of operations and financial condition. 9. Any significant change in the Governments economic liberalization and

deregulation policies could disrupt the business and adversely affect the financial performance of our Company. Any significant change in the Governments policies or any political instability in India could adversely affect the business and economic conditions in India and could also adversely affect the business, future financial performance and the price of the Companys Equity Shares. 10. A decline in India's foreign exchange reserves may affect liquidity and interest rates in the Indian economy, which could adversely impact the Company's financial condition. A decline in India's foreign exchange reserves could impact the valuation of the Rupee and result in reduced liquidity and higher interest rates, which could adversely affect its future financial condition. On the other hand, high levels of foreign funds inflow could add excess liquidity to the system, leading to policy interventions, which would also allow slowdown of economic growth. In either case, an increase in interest rates in the economy following a decline in foreign exchange reserves could adversely affect the Company's business, prospects, financial condition, operations and the trading price of the Equity Shares. 11. Volatile Market: The Equity Shares of the Company are currently not listed. The price of its Equity Shares on the Indian Stock Exchanges may fluctuate after listing as a result of several factors including

Volatility in Indian and global securities market; Results of operations and performance of other units in the Industry; Performance of the competitors and perception in the Indian market about investment in the Fertilizers Industry; Adverse media reports, if any, on the Company or the Fertilizer Industry;

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Changes in the estimates of companys performance or recommendations by financial analysts; Significant development in Indias economic liberalization and de-regulation policies; and Significant development in Indias fiscal and environmental regulations.

12.

Certain factors beyond the control of our Company like Earthquake, Tsunami, civil unrest, epidemic disease, war etc. or any other acts of violence involving India and other countries can adversely affect our Company and financial markets, where the Equity Shares of our Company will be traded Certain events are beyond Companys control such as the tsunami or seismically generated sea waves capable of considerable destruction and terrorist attacks. The other acts of violence or war including civil unrest, military activity and hostilities among countries may adversely affect worldwide financial markets and could lead to economic recession. Any such event could adversely affect our financial performance or the market price of the equity shares.

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III. GENERAL INFORMATION Zuari Agro Chemicals Limited ZUARI AGRO CHEMICALS LIMITED (ZACL/ The Company) was incorporated as a Limited Company, limited by shares on 10th September, 2009 under the Companies Act, 1956 in the name and style as ZUARI HOLDINGS LIMITED. The Companys name was changed to its present name w.e.f. 28th September, 2012 pursuant to fresh certificate of incorporation consequent upon change of name issued by Registrar of Companies, Goa, Daman and Diu. The corporate identification number assigned to our Company is U65910GA2009PLC006177. Registered Office: Jai Kisaan Bhawan, Zuarinagar, Goa-403726, Tel: (0832) 2592180, 2592181 Statutory Auditors: M/s. S.R. Batliboi & Co, 6th Floor, HT House, 18-20 Kasturba Gandhi Marg, New Delhi 110 001, India Share Transfer Agent Link Intime India Pvt Ltd, C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (West), Mumbai 400 078 Banker to the Company 1. State Bank of India, C.A.G Branch, Neville House J.N. Heredia Marg, Ballard Estate, Mumbai 400001 2. HDFC Bank Limited, Manekji Wadia Building, Ground Floor, Nanik Motwani Marg, Fort, Mumbai 400 001 3. Corporation Bank, Raghunathan Apartments Opp. Auto Service F.L Gomes Road Vasco-da-Gama, Goa 403 802 4. Canara Bank, Julleta Building Swatantra Path Vasco-da-Gama, Goa 403 802 5. IDBI Bank Limited, IDBI Tower 9th Floor WTC Complex Cuffe Parade Mumbai 400 005 6. ICICI Bank Ltd, Commercial Banking Group 163, H.T Parekh Marg, Backbay Reclamation, Mumbai- 400020. 7. The Hongkong & Shanghai Bank Corporation Ltd. 52/60, M.G. Road, Level II, Mumbai 400001 8. Indian Overseas Bank, Dr. P. Pissurlkar Road, Hotel Neptune Bldg, Panjim 403001 Company Secretary Mr. R.Y. Patil, Chief General Manager & Company Secretary, Jai Kisaan Bhawan, Zuarinagar, Goa-403726 Authority for Listing The High Court of Bombay at Goa had approved the Scheme of Arrangement and Demerger of Fertiliser Business of ZUARI INDUSTRIES LIMITED, pursuant to sections 391 to 394 of the Companies Act. The salient features of the Scheme of Demerger are set out in the Section

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titled Scheme of Demerger in this Information Memorandum. In accordance with the Scheme of Demerger, the Equity Shares issued by the Company to the shareholders of ZUARI INDUSTRIES LIMITED, shall be listed and admitted for trading on the Stock Exchanges. Such listing and admission for trading is not automatic and is subject to fulfilment by the Company of listing criteria of the Stock Exchanges for such issues and is also subject to such other terms and conditions, as may be prescribed by the Stock Exchanges at the time of application by the Company seeking listing. Eligibility Criterion There being no initial public offering or rights issue, the eligibility criteria in terms Chapters III and IV of the SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009 are not applicable. However, in accordance with the SEBI circular SEBI/CFD/SCRR/01/2009/03/09 dated September 3, 2009, SEBI by its letter no. CFD/DIL/HB/EK/22648/2012 dated October 09, 2012 has granted relaxation from strict enforcement of Rule 19(2)(b) of the Securities Contract (Regulations) Rules, 1957. The Company has submitted its Information Memorandum, containing information about itself, making disclosure in line with the disclosure requirement for public issues, as applicable to BSE and NSE for making the said Information Memorandum available to public through their websites viz. www.bseindia.com and www.nseindia.com The Company has made the said Information Memorandum available on its website viz. www.zuari.in The Company has published an advertisement in accordance with the SEBI circular SEBI/CFD/SCRR/01/2009/03/09 dated September 3, 2009 in the Business Standard (English national daily), Business Standard (Hindi national daily) and in Tarun Bharat, a regional language daily newspaper on Saturday November 10, 2012. The advertisement has a specific reference to the availability of this Information Memorandum on its website. Prohibition by SEBI The Company, its Directors, its promoters, other Companies promoted by the promoters and companies with which the Companys directors are associated as directors have not been prohibited from accessing the capital markets under any order or direction passed by SEBI. General Disclaimer from the Company The Company accepts no responsibility for statement made otherwise than in the Information Memorandum or in the advertisements to be published in terms of SEBI circular SEBI/CFD/SCRR/01/2009/03/09 dated September 3, 2009 or any other material issued by or at the instance of the Company and anyone placing reliance on any other source of information would be doing so at his or her own risk. All information shall be made available by the Company to the public and investors at large and no selective or additional information would be available for a section of the investors in any manner.

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Disclaimer BSE As required, a copy of this Information Memorandum has been submitted to BSE. The BSE has vide its letter dated 21st June, 2011 approved the Scheme of Arrangement and Demerger under clause 24(f) of the Listing Agreement and by virtue of that approval the BSEs name in this Information Memorandum as one of the Stock Exchanges on which the Companys securities are proposed to be listed. The BSE does not in any manner: Warrant, certify or endorse the correctness or completeness of any of the contents of this Information Memorandum; or Warrant that this Companys securities will be listed or will continue to be listed on the BSE; or Take any responsibility for the financial or other soundness of this Company; and It should not for any reason be deemed or construed to mean that this Information Memorandum has been cleared or approved by the BSE. Every person who desires to apply for or otherwise acquires any securities of this Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against the BSE whatsoever by reason of any loss which may be suffered by such person consequent to or in connection with such subscription/acquisition whether by reason of anything stated or omitted to be stated herein or for any other reason whatsoever.

Disclaimer NSE As required, a copy of this Information Memorandum has been submitted to NSE. NSE has vide its letter dated 10th June, 2011, approved the Scheme of Arrangement and Demerger under clause 24(f) of the Listing Agreement and by virtue of the said approval NSEs name in this information memorandum as one of the stock exchanges on which this Companys securities are proposed to be listed. It is to be distinctly understood that the aforesaid permission given by NSE should not in any way be deemed or construed that this Information Memorandum has been cleared or approved by NSE; nor does NSE in any manner warrant, certify or endorse the correctness or completeness of any of the contents of this Information Memorandum; nor does it warrant that the Companys securities will be listed or continue to be listed on the NSE; nor does it take any responsibility for the financial or other soundness of this Company, its promoters, its management or any scheme or project of the Company. Every person who desires to apply for or otherwise acquire any securities of the Company may do so pursuant to independent inquiry, investigation and analysis and shall not have any claim against NSE whatsoever by reason of any loss which maybe suffered by such person consequent to or in connection with such subscription or acquisition whether by reason of any thing stated or omitted to be stated herein or any other reason whatsoever. Filing

19

This revised Information Memorandum has been filed with BSE and NSE Listing Applications will be made to BSE and NSE for permission to deal in and for an official quotation of the Equity Shares of the Company. The Company has nominated BSE Limited as the Designated Stock Exchange for the aforesaid listing of the shares. The Company has taken steps for completion of necessary formalities for listing and commencement of trading at all the Stock Exchanges mentioned above. Demat Credit The company has been allotted ISIN INE840M01016. The Company has recently appointed Link Intime India Private Limited as the Registrar and Share Transfer Agent and is in the process of executing Tripartite Agreements with the Registrar and the Depositories i.e. NSDL and CDSL for admitting its securities in demat form.

Expert Opinions Save as stated elsewhere in this Information Memorandum, we have not obtained any expert opinions. Previous Rights and Public Issues The Company has not made any public or rights issue since incorporation. Commission and Brokerage on previous issues Since the Company has not issued shares to the public in the past, no sum has been paid or has been payable as commission or brokerage for subscribing to or procuring or agreeing to procure subscription for any of the Equity Shares since its inception. Companies under the same management There are no companies under the same management within the meaning of Section 370(1B) of the Companies Act, 1956 other than the ones disclosed elsewhere in the Information Memorandum. Promise vis-a-vis Performance This is for the first time the Company is getting listed on the Stock Exchange. Outstanding Debenture or Bonds and Redeemable Preference Shares and Other Instruments Issued by the Applicant Company

20

There are no outstanding Debenture or Bonds and Redeemable Preference Shares or Other Instruments Issued by the Applicant Company Stock Market Data for Equity Shares of the Company Equity shares of the Company are not listed on any stock exchanges. The Company is seeking approval for listing of shares through this Information Memorandum. Mechanism for redressal of investor grievance of the Applicant Company: Zuari Agro Chemicals Limited has constituted the Investor Grievance Committee to look into and redress Shareholders and Investor Complaints. The members of the Investor Grievance Committee are: Mr. J. N. Godbole Chairman Mr. Marco Wadia Member Mr. H.S. Bawa Member Mr. R.Y. Patil, Chief General Manager & Company Secretary is the compliance officer. The Investor Grievance Committee was constituted by a meeting of the Board of Directors held on 27th March 2012. This committee is responsible for redressal of Shareholders and Investor Complaints relating to transfer of shares, issue of duplicate/ consolidated share certificates, allotment and listing of shares, review of cases for refusal of transfer/transmission of shares and debentures, non- receipt of annual report and non- receipt of dividends declared etc. It is also responsible for reviewing the process and mechanism of redressal of investor complaints and suggesting measures of improving the existing system of redressal of investor grievances. This committee is also responsible for approval of transfer of shares including power to delegate the same to registrar and transfer agents. The company has appointed Link Intime India Private Limited as the Registrar & Transfer Agent. The Memorandum of Understanding between the Registrar and the company will provide for retention of records with the Registrars for a period of at least six months from the date of demat credit to enable the investors to approach the Registrar for redressal of their grievances. Disposal of Investor Grievances by the Company The Company estimates that the average time required by the Company or the Registrar for redressal of routine investor grievance shall be 7 working days from the date of receipt of the complaint. In case of non-routine complaints and complaints where external agencies are involved, the Company will seek to redress these complaints as expeditiously as possible. The Company has appointed Mr. R.Y. Patil, Chief General Manager & Company Secretary as Compliance Officer and he may be contacted in case of any allotment related problems. He can be contacted at the following address: Jai Kisaan Bhawan, Zuarinagar, Goa-403726, Tel: (0832) 2592180, 2592181

21

IV. CAPITAL STRUCTURE Share Capital

I.

Share Capital Pre- Scheme of Demerger:

Rs. Authorised 42,058,006 Equity Shares of Rs, 10 each Issued, Subscribed and Paid Up 12,617,402 Equity Shares of Rs, 10 each 126,174,020 420,580,060

Share Capital Post- Scheme of Demerger:

Authorised 42,058,006 Equity Shares of Rs, 10 each Issued, Subscribed and Paid Up 42,058,006 Equity Shares of Rs, 10 each Rs. 420,580,060

420,580,060

The details of increase and change in authorized share capital of our Company after the date of incorporation till filing of the Information Memorandum is as follows: Date 10th Sept,2009 12th May, 2011 No. of Equity Shares 2,000,000 12,618,000 Face Value (Rs.) 10 10 Authorized Capital (Rs.) 20,000,000 126,180,000 Particulars On Incorporation Increase in Authorised Capital by passing shareholders resolution pursuant to Section 94 of the Companies Act,1956 from Rs. 2 Cr to Rs. 12.61 Cr Increase in Authorised Capital by passing shareholders resolution pursuant to Section 94 of the Companies Act,1956 From Rs. 12.61 Cr to Rs. 42.05 Cr

26th May, 2011

42,058,006

10

420,580,060

22

Notes to Capital Structure

1. Equity Share Capital History of our Company Date of allotment Sept 9, 2010 July 29, 2010 May 20, 2011 April 13, 2012 No. of equity shares 50,000 Cumulative no. of equity shares 50,000 Face Value (Rs.) 10 Issue Price (Rs.) 10 Cumulative Paid Up Capital (Rs.) 500,000 Nature of allotment / remarks Subscribers to MOA Consideration Cash

1,950,000

2,000,000

10

10

20,000,000

10,617,402 29,440,604

12,617,402 42,058,006

10 10

10 NA

126,174,020 420,580, 060

Preferential Allotment to Zuari Investments Limited Preferential Allotment to ZIL, Zuari Management Services Ltd Pursuant to the Scheme of Demerger and Arrangement

Cash Cash

Transfer of the Fertiliser Undertaking

2. Details of Equity shares allotted to/ acquired by the Promoters of the Company, their relatives and associates, and their Directors, from the date of approval of the Scheme by the High Court till the date of submission of this Information Memorandum. Nil

23

3.

Details of shareholding of the Promoters and Promoter Group pre Scheme Date of allotment/acquisition /Transfer Nature of issue and reason for allotment/ transfer Subscriber to MOA No. of equity shares Face Value Issue/ Acquisition Price Consideration (Rs.) % of pre scheme capital Lock in period 0 No. of pledged equity shares 0 % of pledged equity shares 0

Name of Promoter

M/s. Zuari 10 10 500,000 0.40% March 5,2010 50,000 Investments Limited alongwith its nominees M/s. Zuari 10 10 19,500,000 15.45% July 29, 2010 Preferential 1,950,000 Investments Allotment Limited M/s. Zuari 10 10 64,116,010 50.82% May 20, 2011 Preferential 6,411,601 Industries Allotment Limited M/s. Zuari 10 10 42,058,010 33.33% May 20, 2011 Preferential 4,205,801 Management Allotment Services Limited Total 12,617,402 10 126,174,020 100% Note: Zuari Investments Limited, a wholly owned subsidiary of Zuari Industries Limited transferred its holding of Zuari Holdings Limited to Zuari Industries Limited on March 10, 2011 at face value.

0 0 0

0 0 0

0 0 0

2,000,000 shares in

4. Details of the aggregate number of Equity Shares purchased or sold by the Promoters and/or by the Directors of our Company which is a Promoter of our Company and/or by the Directors of our Company and their immediate relatives within six months immediately preceding the date of filing Information Memorandum Nil 5. Details of the maximum and minimum price at which purchases and sales referred to above were made, along with the relevant dates - Nil

24

6. Details of all financing arrangements whereby the Promoter Group, the Directors of our Company which is a Promoter of our Company, the Directors of our Company and their relatives have financed the purchase by any other person of securities of our Company other than in the normal course of the business of the financing entity during the period of six months immediately preceding the date of filing the Information Memorandum - Nil 7. Details of transfers among the Promoters during the period from date of approval of Scheme till the date of Information Memorandum Nil 8. Details of Lock-in of shares of Promoters (Pre-Scheme) Nil

25

9.

Shareholding Pattern

Shareholding Pattern of the Company at incorporation prior to allotment of shares pursuant to the Scheme of Arrangement: Category code Category of Shareholder Number of Shareholders Total number of shares Number of shares held in dematerialize d form Total shareholding as a percentage of total number of shares As a As a percentage percentage 1 of (A+B) of (A+B+C) Shares Pledged or otherwise encumbered No. of Aa a % shares

(A) 1 (a) (b) (c) (d) (e) (e-i) (e-ii) (e-iii) (e-iv)

Shareholding of Promoter and Promoter Group2 Indian Individuals/ Hindu Undivided Family Central Government/ State Government(s) Bodies Corporate Financial Institutions/ Banks Any Others(Specify) Zuari Industries Ltd jointly with Mr. Naveen Kapoor Zuari Industries Ltd jointly with Mr. Binyak Datta Zuari Industries Ltd jointly with Mr. B.K. Kinekar Zuari Industries Ltd jointly with Mr. R.Y. Patil 1 10 1 10 1 10 1 10 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 2 12,617,332 100.00 0.00 0.00 0.00 0.00 0.00 100.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

26

(e-v) (e-vi) (e-vii)

Zuari Industries Ltd jointly with Mr. B.V. Patil Zuari Industries Ltd jointly with Mr. H.C. Shah Zuari Industries Ltd jointly with Mr. N.M. Kantak Sub Total(A)(1)

1 10 1 10 1 10 9 12,617,402 0

0.00 0.00 0.00

0.00 0.00 0.00

0.00 0.00 0.00

0.00 0.00 0.00

100.00

100.00

0.00

0.00

2 a

Foreign Individuals (Non-Residents Individuals/ Foreign Individuals) Bodies Corporate Institutions Any Others(Specify) Sub Total(A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) 0 9 12,617,402 0.00 0.00 0.00 0.00

b c d

0 0

0.00 0.00 0.00 0.00 100.00

0.00 0.00 0.00 0.00 100.00

0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00 0.00 0.00

(B) 1 (a) (b) (c)

Public shareholding Institutions Mutual Funds/ UTI Financial Institutions / Banks Central Government/ State 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

27

Government(s) (d) (e) (f) (g) (h) Venture Capital Funds Insurance Companies Foreign Institutional Investors Foreign Venture Capital Investors Any Other (specify) Sub-Total (B)(1) B2 (a) (b) I Non-institutions Bodies Corporate Individuals Individuals -i. Individual shareholders holding nominal share capital up to Rs 1 lakh ii. Individual shareholders holding nominal share capital in excess of Rs. 1 lakh. Any Other (specify) Sub-Total (B)(2) (B) Total Public Shareholding (B)= (B)(1)+(B)(2) TOTAL (A)+(B) 0 0 0 0 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

II

0.00

0.00

0.00

0.00

(c)

0 0 0 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

12,617,402

100

100

0.00

0.00

28

(C)

Shares held by Custodians and against which Depository Receipts have been issued GRAND TOTAL (A)+(B)+(C) 9

0.00

0.00

0.00

0.00

12,617,402

100

100

0.00

0.00

Shareholding Pattern of the Company post Scheme of Arrangement: Category code Category of Shareholder Number of Shareholders Total number of shares Number of shares held in dematerialized form Total shareholding as a percentage of total number of shares Shares Pledged or otherwise encumbered 1

As a percentage of(A+B)1 (I) (II) (III) (IV) (V) (VI)

As a percentage of (A+B+C) (VII)

Number of shares

As a percentage

(VIII)

(IX)= (VIII)/(IV)*100

29

(A)

Shareholding of Promoter and Promoter Group2 Indian Individuals/ Hindu Undivided Family Central Government/ State Government(s) Bodies Corporate Financial Institutions/ Banks Any Others(Specify) 29 22075998 17870127 52.49 52.49 0.00 0.00 3 181027 181027 0.43 0.43 0.00 0.00

1 (a) (b) (c) (d) (e) (e-i) (e-ii)

Sub Total(A)(1) 2 a b c d d-i d-ii Foreign Individuals (NonResidents Individuals/ Foreign Individuals) Bodies Corporate Institutions Any Others(Specify)

32

22257025

18051154

52.92

52.92

0.00

0.00

7491750

7491750

17.81

17.81

0.00

0.00

30

Sub Total(A)(2) Total Shareholding of Promoter and Promoter Group (A)= (A)(1)+(A)(2) (B) 1 (a) (b) (c) (d) (e) (f) (g) (h) (h-i) (h-ii) Public shareholding Institutions Mutual Funds/ UTI Financial Institutions / Banks Central Government/ State Government(s) Venture Capital Funds Insurance Companies Foreign Institutional Investors Foreign Venture Capital Investors Any Other (specify) Foreign Bank

7491750

7491750

17.81

17.81

0.00 0.00

0.00 0.00

34

29748775

25542904

70.73

70.73

25 32

3795432 4640

3795332 675

9.03 0.01

9.03 0.01

9 50

2433344 2259872

2433094 2259472

5.79 5.37

5.79 5.37

217

217

Sub-Total (B)(1)

117

8493505

8488790

20.20

20.20

31

B2 (a) (b)

Non-institutions Bodies Corporate Individuals Individuals -i. Individual shareholders holding nominal share capital up to Rs 1 lakh ii. Individual shareholders holding nominal share capital in excess of Rs. 1 lakh. Any Other (specify) Clearing Members Non Resident Indians 227 41092 450 2505 3815726 2505 3383156 0.01 9.07 0.01 9.07 38255 0.10 0.10 Overseas Bodies Corp. Trusts Sub-Total (B)(2) Total Public Shareholding (B)= (B)(1)+(B)(2) TOTAL (A)+(B) 443 967746 950461 2.30 2.30

I II

34408

2773669

2361671

6.59

6.59

(c) (c-i) (c-ii) (c-iii) (c-iv)

58

30264

30264

0.07

0.07

1 5 35142

(B)

35259 35293

12309231 42058006

11871946 37414850

29.27 100.00

29.27 100.00

(C)

Shares held by Custodians and against which Depository Receipts

32

have been issued

1 2

Promoter and Promoter Group Public Sub-Total (C ) GRAND TOTAL (A)+(B)+(C) 0 0 0 0 0

35293

42058006

37414850

100.00

100.00

33

10. Details of Shareholders holding more than one percent of the share capital of our Company (Pre-Scheme) Name of Shareholder Zuari Industries Limited Zuari Management Services Limited No. of Equity Shares 8,411,601 4,205,801 % Equity Share Capital 66.67 33.33

11. Details of Lock-in of Shares of Promoters (Post-Scheme) Name of Shareholder No. of Equity Shares % Equity Share Capital Zuari Industries Limited 8,411,601 20.00 Zuari Management Services Limited 4,205,801 10.00 12. Details of Shareholders holding more than one percent of the share capital of our Company (Post-Scheme) Name of Shareholder Zuari Industries Limited Globalware Trading & Holdings Limited Zuari Management Services Limited SIL Investments Limited Texmaco Infrastructure and Holdings Limited Life Insurance Corporation of India New Eros Tradecom Limited Reliance Capital Trustee Co. Ltd Deutsche Securities Mauritius Limited Adventz Investments and Holdings Limited Government Pension Fund Global General Insurance Corporation of India DSP Blackrock Equity Fund Coltrane Corporation Limited The New India Assurance Company Limited Pilani Investment and Industries Corporation No. of Equity Shares 8,411,601 7,012,000 4,205,801 3,208,000 2,557,941 1,350,526 1,196,767 1,103,483 899,098 836,852 592,704 565,922 561,629 479,750 446,010 434,000 % Equity Share Capital 20.00 16.67 10.00 7.63 6.08 3.21 2.85 2.62 2.14 1.99 1.41 1.35 1.34 1.14 1.06 1.03

13. A list of top 10 shareholders of our Company and the number of Equity Shares held by them is as under: a) Pre-Scheme S.N Shareholders Name No. of Equity Shares % of Issued Capital 1 Zuari Industries Limited 8,411,601 66.67 2 Zuari Management Services Limited 4,205,801 33.33 3 Zuari Industries Ltd jointly with Mr. 10 0.00 Naveen Kapoor 4 Zuari Industries Ltd jointly with Mr. 10 0.00 Binyak Datta 5 Zuari Industries Ltd jointly with Mr. 10 0.00

34

6 7 8 9

B.K. Kinekar Zuari Industries Ltd jointly with Mr. R.Y. Patil Zuari Industries Ltd jointly with Mr. B.V. Patil Zuari Industries Ltd jointly with Mr. H.C. Shah Zuari Industries Ltd jointly with Mr. N.M. Kantak

10 10 10 10

0.00 0.00 0.00 0.00

b) As on the date of this Information Memorandum (Post-Scheme):

Name of Shareholder Zuari Industries Limited Globalware Trading & Holdings Limited Zuari Management Services Limited SIL Investments Limited Texmaco Infrastructure and Holdings Limited Life Insurance Corporation of India New Eros Tradecom Limited Reliance Capital Trustee Co. Ltd Deutsche Securities Mauritius Limited Adventz Investments and Holdings Limited

No. of Equity Shares 8,411,601 7,012,000 4,205,801 3,208,000 2,557,941 1,350,526 1,196,767 1,103,483 899,098 836,852

% Equity Share Capital 20.00 16.67 10.00 7.63 6.08 3.21 2.85 2.62 2.14 1.99

c) As on 10 days prior to the date of this Information Memorandum: S.N 1 2 3 4 5 6 7 8 9 Shareholders Name Zuari Industries Limited Zuari Management Services Limited Zuari Industries Ltd jointly with Mr. Naveen Kapoor Zuari Industries Ltd jointly with Mr. Binyak Datta Zuari Industries Ltd jointly with Mr. B.K. Kinekar Zuari Industries Ltd jointly with Mr. R.Y. Patil Zuari Industries Ltd jointly with Mr. B.V. Patil Zuari Industries Ltd jointly with Mr. H.C. Shah Zuari Industries Ltd jointly with Mr. N.M. Kantak No. of Equity Shares 8,411,601 4,205,801 10 10 10 10 10 10 10 % of Issued Capital 66.67 33.33 0.00 0.00 0.00 0.00 0.00 0.00 0.00

35

d) As on two years prior to the date of this Information Memorandum: S.N 1 Shareholders Name M/s. Zuari Investments Limited alongwith its nominees No. of Equity Shares 50,000 % of Issued Capital 100.00%

14. The Company has no ESOP Scheme pending as of the date of this document 15. As on the date of filing this Information Memorandum, there are no outstanding financial instruments or any other right, which would entitle the Promoters or shareholders or any other person any option to receive Equity Shares. 16. As on the date of this Information Memorandum, there are no outstanding warrants, options or rights to convert debentures, loans or other instruments into Equity Shares. 17. We have not issued any Equity Shares out of revaluation reserve or reserves without accrual of cash resources. 18. At any given time, there shall be only one denomination of the Equity Shares of our Company and our Company shall comply with such disclosure and accounting norms specified by SEBI from time to time. The Equity Shareholders of our Company do not hold any warrant, option or convertible loan or debenture, which would entitle them to acquire further Equity Shares in the Company. 19. Our Company has 35,293 shareholders as on the date of filing this Information Memorandum. 20. SIL Investment and New Eros Tradecom have pledged 2,970,000 and 1,196,767 shares in ZIL respectively, against which shares in ZHL have been issued in 1:1 ratio. These shares in ZHL would be further pledged on credit of shares to the respective accounts 21. Information on shareholding of Directors is given in Company History and Management 22. As on date there are no partly paid-up Equity Shares.

36

V. OBJECTS AND RATIONALE OF THE SCHEME Brief Profile of Transferor Company Zuari Global Limited was engaged in primarily the following distinct and diverse business activities, namely: a) b) c) Fertilizer business which comprises of manufacturing and sale of fertilizers; Pesticide business which comprises of procuring and marketing of pesticides; and Other businesses which comprise businesses undertaken through subsidiaries and jointventures namely manufacturing and trading in furniture, real estate development, providing engineering consultancy services, manufacture of cement, transportation and storage of petroleum products, etc.

Brief Financials of the Transferor Company are as below: All Data in `. Lakhs Revenue (Gross) Profit Before Depreciation and Tax Net Profit After Tax Equity Share Capital EPS (Rs.)

FY 2009 6,09,060 12,542 9,328 29.44 31.69

FY 2010 4,27,755 21,964 15,696 29.44 53.31

FY 2011 5,52,283 29,945 16,688 29.44 56.68

Rationale for the Scheme of Demerger z ZGL had grown to a very sizeable organisation and has evolved into a well diversified and progressive industrial group. z Each of the respective businesses of ZGL were distinct and diverse in their characteristics, growth trajectories, risk profile, maturity stage, requirement of funds and require entirely different approaches. In order to effectively and efficiently cater to the independent growth plans (both through organic and inorganic means), of each of the respective businesses, and in order to diversify, continuous funding support through equity and debt is imperative. z The Transferee Company was a direct and indirect wholly owned subsidiary of the Company, and was engaged in the business of inter alia making strategic investments into and holding securities of other entities and operating fertilizer plants. z With the intent of adopting a linear structure in the businesses of ZGL, the Board of Directors of ZGL decided to demerge the Fertilizer Undertaking of the Company into the Transferee Company, in compliance with provisions of Sections 391-395 and other relevant provisions of the Act. z The benefits likely to arise from the proposed arrangement and demerger are as follows: a) The arrangement and demerger would be in the larger interest of the shareholders, creditors and employees of ZGL as it will enable them to fulfill their objectives more efficiently by separately holding investments which best suit their investment strategies and risk profiles.

37

b) The Scheme gives flexibility to shareholders of ZGL to continue or divest in the Company and/or in the Transferee Company. c) The demerger of the Fertilizer Undertaking into the Transferee Company will provide as a measure of corporate restructuring and will help to develop potential for further growth and diversification to have better synergy and optimization of resources as well as to facilitate fund raising and development of the Fertilizer Undertaking. d) The demerger would enable the better and more efficient management, control and running of the Fertilizer Undertaking by the Transferee Company. e) The Scheme would not in any manner be prejudicial to the interests of concerned shareholders or creditors or general public at large. The arrangement contemplated in the Scheme would help avoid duplication of resources, systems, skills and process, reduce overall cost, improve synergies, enable the achievement of economies of scale, reduce administrative costs entailed by the conduct of businesses through separate entities, provide enhanced flexibility in funding of expansion plans, promote management efficiency and optimize the resources of the Transferor Company and the Transferee Company.

38

VI. SALIENT FEATURES OF THE SCHEME The Scheme provided for the following: (i) the transfer by way of a demerger of the Fertilizer Undertaking of the Transferor Company in to the Transferee Company (ii) Issue of equity shares by the Transferee Company to the shareholders of the Transferor Company Transfer by way of a demerger of the Fertilizer Undertaking of the Transferor Company in to the Company Fertilizer Undertaking meant the business of manufacture and sale of fertilizers undertaken by the Transferor Company, on a going concern basis, as on the Appointed Date. Without prejudice and limitation to the generality of the above, the Fertilizer Undertaking meant and included: (a) all assets whether movable or immovable, tangible or intangible, including all rights, title, interest, covenant, undertakings, including continuing rights, title and interest in connection with the land and the buildings thereon whether, corporeal or incorporeal, leasehold or otherwise, plant and machinery, fixed or moveable, and whether leased or otherwise, including inventory and work in progress appertaining or relatable to the Fertilizer Undertaking; Fertiliser Companies' Government of India Special Bonds, loans and advances, including accrued interest thereon, of the Transferor Company appertaining to the Fertilizer Undertaking, including deposits/ advances paid towards acquisition of the immovable property of the Fertilizer Undertaking; any and all permits, rights, entitlements, allotments, approvals, consents, concessions, exemptions, liberties, advantages, no-objection certificates, certifications, registrations, trade names, trademarks, service marks, copyrights, domain names, easements, goodwill, brand, licenses, tenancies, offices, sales tax credits, subsidies, privileges and benefits of all contracts, agreements, and all other rights including lease rights, licenses, powers and facilities of every kind and description whatsoever pertaining to the Fertilizer Undertaking; any and all earnest monies and/or security deposits, payment against warrants or other entitlements in connection with or relating to the said Fertilizer Undertaking; All books, records, files, papers, engineering and process information, computer programmes, software licenses (whether proprietary or otherwise), drawings, manuals, data, catalogues, quotations, sales and advertising materials, lists of present and former customers and suppliers, customer credit information, customer pricing information, and other records whether in physical or electronic form in connection with or relating to the Fertilizer Undertaking; all staff, workmen and other employees of the Transferor Company on the Appointed Date as are engaged in or in relation to the Fertilizer Undertaking; and

(b)

(c)

(d) (e)

(f)

39

(g)

any and all debts, borrowings, guarantees, assurances, commitments, obligations and liabilities, whether fixed, contingent or absolute, asserted or unasserted, present or future, whether secured or unsecured, pertaining to the Fertilizer Undertaking including the following: a. specific loans and borrowings (if any), term loans from banks and financial institutions (if any), bank overdrafts (if any), working capital loans & liabilities, whether secured or unsecured, amount due to small scale industrial undertakings raised incurred and utilized solely for the activities or operation of the business of manufacture and supply of fertilizer; and b. Liabilities other than those referred to above, being the amounts of general or multipurpose borrowings of the Transferor Company if any, allocated to the business of manufacture and supply of fertilizer in the same proportion in which the value of the assets (ignoring the re-valued amount) transferred under this Scheme to Transferee Company bear to the total value of the assets of the Transferor Company immediately before giving effect to this Scheme.

Particulars of Assets and Liabilities Transferred as part of Demerged Undertaking:

As at 01st July, 2011 1 Fixed assets Gross block Less: Depreciation Net block Capital work-in-progress

Rs In lacs

48,112.76 28,268.93 19,843.83 1,566.19 21,410.02

2 3 4

Investments Deferred Tax Assets Current Assets, Loans and Advances Inventories Sundry debtors Cash and bank balances Loans and advances Other Current Assets

0.00 0.00

89,716.00 93,458.63 1,480.76 30,285.29 20,604.37 0.00

Profit & Loss Account

40

TOTAL ASSETS (A) 6 Current Liabilities and Provisions Current liabilities Provisions 7 Loan funds Secured Loans Unsecured Loans TOTAL LIABILITIES (B) Total (A-B)

235,545.05

80,562.65 3,375.79

73,143.66 30,000.00 187,082.10 48,462.95

Issue of Shares by the Transferee Company Upon this Scheme becoming Effective, the Board of Directors of the Transferor Company determined the record date as 10th April, 2012, (Record Date), for issue and allotment of fully paid-up equity shares by the Transferee Company to the members of the Transferor Company in accordance with this Clause and on determination of the Record Date, the Transferor Company provided to the Transferee Company, the list of shareholders of the Transferor Company as on the Record Date who were entitled to the issue and allotment of the fully paid-up equity shares in terms of this Scheme, to enable the Transferee Company to issue and allot fully paidup equity shares in terms of this Scheme. Upon determination of the Record Date, the Transferee Company, in consideration for the transfer of the Fertilizer Undertaking, without further application, issued and allotted to the equity shareholders of the Transferor Company as on the Record Date, 1 equity share of face value of Rs. 10/- (Rupees Ten each) (credited as fully paid-up) for every 1 fully paid-up equity share of Rs. 10/- (Rupees Ten each) each held by them in the Transferor Company as on the Record Date. In the event of there being any pending share transfers, whether lodged or outstanding, of any shareholder of the Transferor Company, the Board of Directors of the Transferor Company have been empowered in appropriate cases, prior to or even subsequent to the Record Date, to effectuate such a transfer as if such changes in the registered holder were operative as on the Record Date, in order to remove any difficulties arising to the transferor or transferee of equity shares in the Transferor Company, after the effectiveness of this Scheme.

41

In respect of entitlement of nominee shareholders of Transferor Company, the equity shares of the Transferee Company were issued to the beneficiary for whom such shares were held by as a nominee by the nominee shareholder.

Sequence of events of Scheme of Arrangement: 1) Board of directors approved the Scheme of Arrangement at its Meeting held on 24th May, 2011. 2) Application under Sections 391(1) and 393 of the Companies Act, 1956 filed with the Honble High court of Bombay at Goa on June 29, 2011 for the following; a) Waiver of Convening Shareholders meeting b) Waiver of Convening of Creditors meeting The Honble High Court issued order on July 07, 2011 for the following a) Convening Shareholders meeting was waived off b) Convening of Creditors meeting was waived off The Transferor Company held shareholders meeting on August 17, 2011. Scheme of Arrangement and Demerger approved by requisite majority at the said meetings. The Transferor Company filed the consequential petition for sanction of the Scheme by the High Court under Sections 391(2) and 394 of the Companies Act, 1956 on August 26, 2011. Court Admitted the petition on August 26, 2011 and issued orders for giving notice to the Regional director, publishing advertisement of notice of hearing in the newspapers and fixing the matter for final hearing on September 09, 2011. The Scheme of Arrangement sanctioned by the Hon'ble High Court vide order dated March 02, 2012. The certified copies of the order filed with RoC, Goa, Daman & Diu on March 21, 2012. Upon filing of such certified copies, the Scheme came into effect and the Fertilizer Undertaking of the Transferor Company stands transferred to the Transferee Company from the Appointed Date, i.e. July 01, 2011. The Transferee Company had received in-principle approval from BSE Limited (BSE) and National Stock Exchange Limited (NSE) vide their letter dated 21st June, 2012 and 04th July, 2012 respectively.

3)

4)

5)

6)

7)

8)

9)

10)

The Transferee Company had received relaxation from strict enforcement of Rule 19 (2) (b) of Securities Transaction (Regulation) Rules, 1957 by SEBI by letter dated 09th October, 2012.

42

VII. STATEMENT OF GENERAL TAX BENEFITS

43

ANNEXURE TO STATEMENT OF POSSIBLE TAX BENEFITS AVAILABLE TO THE COMPANY AND ITS SHAREHOLDERS UNDER THE IT ACT The tax benefits listed below are the possible benefits available under the current tax laws in India. Several of these benefits are dependent on the company or its shareholders fulfilling the conditions prescribed under the tax laws. Hence, the ability of the Company or its shareholders to avail the tax benefits is dependent upon fulfilling such conditions as may be prescribed under the relevant sections of the IT Act. I. 1 BENEFITS AVAILABLE TO THE COMPANY Subject to compliance with certain conditions laid down in section 32 of the IT Act, the Company will be entitled to a deduction for depreciation: a) In respect of buildings, machinery, plant or furniture being tangible assets (at the rates prescribed under Income Tax Rules, 1962 (the Rules); In respect of intangible assets being in the nature of knowhow, patents, copyrights, trademarks, licenses, franchises or any other business or commercial rights of similar nature acquired after 31st day of March, 1998 (at the rates prescribed under the Rules); In respect of new plant or machinery which has been acquired and installed after 31st March, 2005 by a tax payer engaged in the business of manufacture or production of any article or thing, additional depreciation @ 20% of the actual cost of such new plant or machinery will be allowed as deduction.

b)

c)

Subject to compliance with certain conditions laid down in section 35(1)(iv) of the IT Act, the Company is entitled to claim as deduction the whole of capital expenditure, other than the expenditure incurred on the acquisition of any land, incurred on scientific research related to the business of the Company. Subject to certain conditions, deduction of 100% is available under section 35AD of the Act, in respect of capital expenditure (other than land, goodwill or financial instruments) incurred wholly and exclusively for the purpose of specified business carried on by Company. The Finance Bill 2012 has proposed the enhancement of this deduction from 100% to 150% for the certain specific business out of the present list of specified businesses mentioned in section 35AD of the Act in case such business commences its operation on or after 1 April 2012. Under section 35DD of the Act, deduction for 1/5th of the expenditure incurred in connection with Amalgamation of an undertaking by way of amortization over a period of 5 successive years, beginning with the year in which the amalgamation or demerger takes place.

44

As per section 35DDA, the Company is eligible for deduction in respect of payments made to its employees in connection with their voluntary retirement of an amount equal to 1/5th of such expenses every year for a period of five years subject to conditions specified in that section. Deduction of rent, rates, taxes, repairs and insurance for buildings under Section 30 of the Act and repairs and insurance for machinery, plant and furniture under Section 31 of the Act. Under section 36(1) (i) of the Act, deduction for any premium paid by the Company in respect of insurance against risk of damage or destruction of stocks or stores used for the purposes of the business or profession and under section 36(1)(ib) of the Act, any premium paid the Company to the effect or to keep in force an insurance on the health of his employees under a scheme framed in this behalf by the specified insurers. Under section 36(1)(ii) of the Act, deduction for any sum paid to an employee as bonus or commission for services rendered, where such sum would not have been payable to him as profits or dividend if it had not been paid as bonus or commission. Under section 36(1) (iii) of the Act, deduction for any sum paid on account of the interest in respect of capital borrowed for the purposes of the business or profession. As per proviso of Section 36(1)(iii), deduction of interest paid is not allowed on capital borrowed for acquisition of an asset for extension of existing business till the time such asset was first put to use of which interest would be capitalized and form part of the actual cost for the purpose of claiming depreciation under Section 32 as mentioned above. Under section 36(1)(iv) of the Act, deduction for any sum paid by the Company as an employer by way of contribution towards a recognized provident fund or an approved superannuation fund subject to specified prescribed limits and the conditions as specified by the Board shall be available as deduction. Under section 36(1)(iva) of the Act, deduction for any sum paid by the Company as an employer by way of contribution towards a pension scheme (referred to in section 80CCD of the Act) on account of an employee to the extent it does not exceed 10% of the salary of the employee in the previous year shall be available as deduction. Under section 36(1)(v) of the Act, deduction for any sum paid by the Company as an employer by way of contribution towards an approved gratuity fund for the exclusive benefit of his employees under an irrevocable trust shall be available as deduction. Under section 36(1) (va) of the Act, any sum received by the Company from the employees referred under section 2(24)(x) of the Act (i.e., received towards employees contribution towards provident fund, superannuation fund set-up under

10

11

12

13

45

the provisions of the Employees State Insurance Act, 1948 or any other fund for the welfare of such employees), if such sum is credited by the Company to the employees account in the relevant fund on or before due date. 14 Under Section 36(1)(vii) of the Act, deduction is available for any bad debt or part thereof written off as irrecoverable in the accounts of the Company for the previous year. Under Section 36(1)(ix) of the Act, deduction is available for any expenditure bona fide incurred by the Company for the purpose of promoting family planning amongst its employees. With effect from Assessment Year 2009-2010, under section 36(1)(xv) of the I.T. Act, the STT paid in respect of taxable securities transactions entered into in the course of business is allowable as deduction if income is computed under the head Profits or Gains of Business or Profession. Under Section 37(1) of the Act, deduction for any expenditure not being expenditure of the nature described in Sections 30 to 36 of the Act, and not being in the nature of capital expenditure or personal expenses of the assessee, laid out or expended wholly and exclusively for the purposes of the business or profession in computing the income. Further, any expenditure which is for an offence or prohibited by law is not allowed as deduction. The Company is eligible for amortization of preliminary expenses being the expenditure on public issue of shares under section 35D of the IT Act, subject to the fulfilment of the prescribed conditions and limits specified in the section. The said deduction is an amount equal to one-fifth of the said expenditure for each of the five successive previous years beginning from the year in which the business commences. As per Section 80G, the Company will be eligible for deduction of an amount as specified in the Section in respect of donations to certain funds, charitable institutions, etc. As per Section 80GGB, the Company will be eligible for deduction of any sum contributed by it to any political party or an electoral trust. In case of loss under the head Profit and Gains from Business or Profession, it can be set-off against other income and the excess loss after set-off can be carried forward for set-off - against business income of the next eight Assessment Years. As per the provisions of Section 72A, the Company is entitled to carry forward and set off of accumulated loss and unabsorbed depreciation allowance under amalgamation or demerger subject to fulfillment of certain conditions.

15

16

17

18

19

20

21

22

46

23

Minimum Alternate Tax (MAT) is the tax payable by a company under section 115JB of the IT Act. MAT is payable by a company when the income-tax payable on the total income as computed under the I.T. Act is less than 18.5% (plus applicable Surcharge + Education and Secondary & Higher Education cess) of its book profit computed as per the method specified under section 115JB of the Act. MAT credit arises in the year in which the Company is required to pay tax under section 115JB of the IT Act (in case the same is higher than the tax under normal provisions of the IT Act). MAT credit is the difference between tax computed under section 115JB of the IT Act and the tax computed as per the normal provisions of the IT Act. MAT credit can be carried forward for 10 years immediately succeeding the assessment year in which the relevant MAT credit arises. The MAT credit can be utilized in the year in which the tax payable under the normal provisions of the IT Act is higher than the tax payable under section 115JB of the IT Act. The utilisation of the same is available to the extent of the difference between the tax payable under the normal provisions of the IT Act and the tax payable under section 115JB of the IT Act. As per section 71 read with section 74 of the I.T. Act, short term capital loss arising during a year is allowed to be set-off against short term as well as long term capital gains. Balance loss, if any, shall be carried forward and set-off against any capital gains arising during subsequent eight assessment years. As per Section 71 read with Section 74, long term capital loss arising during a year is allowed to be set-off only against long term capital gains. Balance loss, if any, is allowed to be carried forward and set-off against subsequent years long term capital gains for subsequent eight assessment years. BENEFITS AVAILABLE TO THE COMPANY AND PROSPECTIVE RESIDENT SHAREHOLDERS OTHER THAN DOMESTIC COMPANIES DIVIDENDS EXEMPT UNDER SECTION 10(34) OF THE IT ACT

24

25

II

Any income by way of dividends (declared, distributed or paid on or after 1 April 2003) by a domestic company is exempt in the hands of the shareholders (Company/Individual), if the same is subject to dividend distribution tax as referred to in section 115-O of the IT Act, as per the provisions of section 10(34) of the IT Act. The income chargeable under the head Capital gains shall be computed by deducting from the full value of consideration received on sale of securities or units, the cost of acquisition of the said securities or units and the expenditure incurred wholly and exclusively in connection with such sale. In case the full value of consideration is less than the cost of the acquisition and the expenditure incurred wholly and exclusively in connection with such transfer it would result in a capital loss. However, section 94(7) of the IT Act provides that the capital loss arising on account of sale/transfer of securities or units purchased up to three months prior to the record date and sold within three months after such date (in case of securities) or within a period of nine months after such date (in case of units), would be disallowed

47

to the extent to which dividend on such securities or units are claimed as exempt by the shareholder. INCOME FROM CAPITAL GAINS 2.1 Section 48 of the IT Act, categorises capital assets into two categories viz. Long Term Capital Assets and Short Term Capital Assets. If securities (such as shares, units etc) are held for a period of more than 12 months it is termed as a long term capital asset, otherwise as a short term capital asset. Any profit or loss arising on account of sale/transfer of such long term capital assets are termed as long term capital gains / loss and profit or loss arising on account of sale/transfer of short term capital assets is considered as short term capital gains / loss. Section 48 of the IT Act, which prescribes the mode of computation of capital gains, provides for deduction of cost of acquisition / improvement and expenses incurred wholly and exclusively in connection with the transfer of a capital asset, from the sale consideration to arrive at the amount of capital gains. However, the second proviso to section 48 of the IT Act, in respect of long term capital gains arising from transfer of shares of Indian Company, offers a benefit by permitting substitution of cost of acquisition / improvement with the indexed cost of acquisition / improvement, which adjusts the cost of acquisition / improvement by a cost inflation index, as prescribed annually. Section 10(38) of the IT Act, exempts the long term capital gains arising on sale of equity shares in the Company where the sale transaction has been entered on a recognized stock exchange of India and has been liable to securities transaction tax. However, the income by way of long-term capital gain of the company is taken into account in computing the book profit and income tax payable under section115JB of the IT Act. The provisions of section 112 of the IT Act, permit taxing long term capital gains [which are not exempt under Section 10(38) of the IT Act] arising on transfer of shares in the Company at a rate of 20 percent (plus applicable surcharge and education cess) after considering indexation benefit. However, the share holder may opt for the tax on long term gains computed at the rate of 10 percent (plus applicable surcharge and education cess), if the tax on long term capital gains resulting on transfer of listed securities calculated at the rate of 20 percent (after indexation benefit) exceeds the tax on long term gains computed at the rate of 10 percent without considering indexation benefit. The provisions of section 111A of the IT Act, prescribes for taxing the short-term capital gains arising from sale of equity shares in a Company at a rate of 15 percent (plus applicable surcharge and education cess) where such transaction of sale is entered on a recognized stock exchange in India and is liable to securities transaction tax.

2.2

2.3

2.4

2.5

48

2.6

Provisions of section 54EC of the IT Act exempts long-term capital gains [which are not exempt under section 10(38) of the IT Act] from being taxed to the extent such capital gains are invested in long term specified assets within a period of 6 months after the date of such transfer (presently, bonds issued by the National Highways Authority of India or the Rural Electrification Corporation Limited have been specified). Where only a part of the capital gains is so invested, the exemption is proportionately available. However, the investment in the specified assets is limited to Rs 5 million. The minimum holding period in the prescribed investment to remain eligible for the exemption is 3 years. Subject to the conditions specified under the provisions of section 54F of the IT Act, long-term capital gains [which are not exempt from tax under section 10(38) of the IT Act] arising to an individual or a Hindu Undivided Family (HUF) on transfer of shares of the Company will be exempt from capital gains tax if the sale proceeds from transfer of such shares are used for purchase of residential house property within a period of 1 year before or 2 years after the date on which the transfer took place or for construction of residential house property, within a period of 3 years after the date of such transfer. In terms of Securities Transaction Tax as enacted by Chapter VII of the Finance (No.2) Act, 2004, transactions for purchase and sale of the securities in the recognized stock exchange by the shareholder, shall be chargeable to securities transaction tax. As per the said provisions, any delivery based purchase and sale of equity share in a company through the recognized stock exchange is liable to securities transaction tax @ 0.125 percent of the value payable by both the buyer and the seller (tax rate of 0.1% is proposed in the Finance Bill 2012). Further, the non-delivery based sale transactions are liable to tax @ 0.025 percent of the value payable by the seller. BENEFITS AVAILABLE TO CORPORATE RESIDENT SHAREHOLDERS (DOMESTIC COMPANIES). DIVIDENDS EXEMPT UNDER SECTION 10(34) OF THE IT ACT

2.7

2.8

III

Any income by way of dividends (declared, distributed or paid on or after 1 April 2003) by a domestic company is exempt in the hands of the shareholders (Company/Individual), if the same is subject to dividend distribution tax as referred to in section 115-O of the IT Act, as per the provisions of section 10(34) of the IT Act. The income chargeable under the head Capital gains shall be computed by deducting from the full value of consideration received on sale of securities or units, the cost of acquisition of the said securities or units and the expenditure incurred wholly and exclusively in connection with such sale. In case the full value of consideration is less than the cost of the acquisition and the expenditure incurred wholly and exclusively in connection with such transfer it would result in a capital loss. However, section 94(7) of the IT Act provides that the capital loss arising on account of sale /transfer of securities or units purchased up to three months prior to

49

the record date and sold within three months after such date (in case of securities) or within a period of nine months after such date (in case of units), would be disallowed to the extent to which dividend on such securities or units are claimed as exempt by the shareholder. INCOME FROM CAPITAL GAINS 2.1 Section 48 of the IT Act, categorises capital assets into two categories viz. Long Term Capital Assets and Short Term Capital Assets. If securities (such as shares, units etc) are held for a period of more than 12 months it is termed as a long term capital asset, otherwise as a short term capital asset. Any profit or loss arising on account of sale/transfer of such long term capital assets are termed as long term capital gains / loss and profit or loss arising on account of sale/transfer of short term capital assets is considered as short term capital gains / loss. Section 48 of the IT Act, which prescribes the mode of computation of capital gains, provides for deduction of cost of acquisition / improvement and expenses incurred wholly and exclusively in connection with the transfer of a capital asset, from the sale consideration to arrive at the amount of capital gains. However, the second proviso to section 48 of the IT Act, in respect of long term capital gains arising from transfer of shares of Indian Company, offers a benefit by permitting substitution of cost of acquisition /improvement with the indexed cost of acquisition /improvement, which adjusts the cost of acquisition / improvement by a cost inflation index, as prescribed annually. Section 10(38) of the IT Act, exempt the long term capital gains arising on sale of equity shares in the Company where the sale transaction has been entered into on a recognized stock exchange of India and has been liable to securities transaction tax, However, the income by way of long-term capital gain of the company is taken into account in computing the book profit and income tax payable under section 115JB of the IT Act. The provisions of section 112 of the IT Act, permit taxing long term capital gains [which are not exempt under Section 10(38) of the IT Act] arising on transfer of shares in the Company at a rate of 20 percent (plus applicable surcharge and education cess) after considering indexation benefit. However, the share holder may opt for the tax on long term gains computed at the rate of 10 percent (plus applicable surcharge and education cess), if the tax on long term capital gains resulting on transfer of listed securities calculated at the rate of 20 percent (after indexation benefit) exceeds the tax on long term gains computed at the rate of 10 percent without considering indexation benefit. The provisions of section 111A of the IT Act, prescribe for taxing the short-term capital gains arising from sale of equity share in a Company at a rate of 15 percent (plus applicable surcharge and education cess) where such transaction of sale is

2.2

2.3

2.4

2.5

50

entered on a recognized stock exchange in India and is liable to securities transaction tax. 2.6 Provisions of section 54EC of the IT Act exempts long-term capital gains (which are not exempt under section 10(38) of the IT Act) from being taxed to the extent such capital gains are invested in long term specified assets within a period of 6 months after the date of such transfer (presently, bonds issued by the National Highways Authority of India or the Rural Electrification Corporation Limited have been specified). Where only a part of the capital gains is so invested, the exemption is proportionately available. However, the investment in specified asset is limited to Rs 5 million. The minimum holding period in the prescribed investments to remain eligible for the exemption is 3 years. In terms of Securities Transaction Tax as enacted by Chapter VII of the Finance (No.2) Act, 2004, transactions for purchase and sale of the securities in the recognized stock exchange by the shareholder, shall be chargeable to securities transaction tax. As per the said provisions, any delivery based purchase and sale of equity share in a company through the recognized stock exchange is liable to securities transaction tax @ 0.125 percent of the value payable by both the buyer and the seller (tax rate of 0.1% is proposed in the Finance Bill 2012). Further, the non-delivery based sale transactions are liable to tax @ 0.025 percent of the value payable by the seller.

2.7

IV 1

BENEFITS AVAILABLE TO MUTUAL FUNDS Provisions of section 10(23D) of the IT Act exempt the Mutual Funds registered under the Securities and Exchange Board of India or Mutual Funds set up by Public Sector Banks or Public Financial Institutions or authorized by the Reserve Bank of India and subject to the conditions specified therein, from income tax on their income.

BENEFITS AVAILABLE TO FOREIGN INSTITUTIONAL INVESTORS (FIIS) DIVIDENDS EXEMPT UNDER SECTION 10(34) OF THE IT ACT

Any income by way of dividends (declared, distributed or paid on or after 1 April 2003) by a domestic company is exempt in the hands of the shareholders (Company /Individual), if the same is subject to dividend distribution tax as referred to in section 115-O of the IT Act, as per the provisions of section 10(34) of the IT Act. The income chargeable under the head Capital gains shall be computed by deducting from the full value of consideration received on sale of securities or units, the cost of acquisition of the said securities or units and the expenditure incurred wholly and exclusively in connection with such sale. In case the full value of consideration is less than the cost of the acquisition and the expenditure incurred wholly and exclusively in connection with such transfer, it would result in a capital

51

loss. However, section 94(7) of the IT Act provides that the capital loss arising on account of sale/transfer of securities or units purchased up to three months prior to the record date and sold within three months after such date (in case of units) or within a period of nine months after such date (in case of units), would be disallowed to the extent to which dividend on such securities or units are claimed as exempt by the shareholder.

INCOME FROM CAPITAL GAINS 2.1 Provisions of section 115AD of the IT Act, provides for taxing income of FIIs arising from securities [other than income by way of dividends referred to in section 115(O) of the IT Act] at concessional rates, as follows: Nature of income Rate of tax (%) 20

Income in respect of securities (other than units referred to in section 115AB of the Act) Long Term capital gains Short term capital gains (other than short term capital gain referred to in section 111A of the Act)

10

30

The above tax rates would be increased by the applicable surcharge and education cess. The benefits of indexation and foreign currency fluctuation protection as provided under section 48 of the IT Act are not available to the FIIs. 2.2 Provisions of section 111A of the IT Act, prescribes for taxing the short-term capital gains arising from sale of equity share in the Company at a rate of 15 percent (plus applicable surcharge and education cess) where such transaction of sale is entered on a recognized stock exchange in India and is liable to securities transaction tax. Provisions of the Double Taxation Avoidance Agreement between India and the country of residence of the FII would prevail over the provisions of the IT Act, as per section 90(2) of the Act; to the extent they are more beneficial to the FII. Provisions of section 10(38) of the IT Act, exempt from tax the long term capital gains arising on sale of equity shares in the Company where the sale transaction has been entered on a recognized stock exchange of India and is liable to securities transaction tax. Provisions of section 54EC of the IT Act exempts long-term capital gains [which are not exempt under section 10(38) of the IT Act] from being taxed to the extent such capital gains are invested in long term specified assets within a period of 6 months after the date of the transfer (presently, bonds issued by the National Highways

2.3

2.4

2.5

52

Authority of India or the Rural Electrification Corporation Limited have been specified). Where only a part of the capital gains is so invested, the exemption is proportionately available. However, the investment in specified asset is limited to Rs 5 million. The minimum holding period prescribed to remain eligible for the exemption is 3 years. 2.6 In terms of Securities Transaction Tax as enacted by Chapter VII of the Finance (No.2) Act, 2004, transactions for purchase and sale of the securities in the recognized stock exchange by the shareholder, shall be chargeable to securities transaction tax. As per the said provisions, any delivery based purchase and sale of equity share in a company through the recognized stock exchange is liable to securities transaction tax @ 0.125 percent of the value payable by both buyer and seller (tax rate of 0.1% is proposed in the Finance Bill 2012). (The non-delivery based sale transactions are liable to tax @ 0.025 percent of the value payable by the seller). BENEFITS AVAILABLE TO VENTURE CAPITAL COMPANIES/FUNDS Provisions of section 10(23FB) of the IT Act, exempts any income of Venture Capital companies/Funds (set up to raise funds for investment in venture capital undertaking registered and notified in this behalf) registered with the Securities and Exchange Board of India, subject to conditions specified therein. BENEFITS AVAILABLE TO NON-RESIDENTS / NON-RESIDENT INDIAN SHAREHOLDERS (OTHER THAN MUTUAL FUNDS, FIIS AND FOREIGN VENTURE CAPITAL INVESTORS) DIVIDENDS EXEMPT UNDER SECTION 10(34) OF THE IT ACT 1 Any income by way of dividends (declared, distributed or paid on or after 1 April 2003) by a domestic company is exempt in the hands of the shareholders (Company/Individual), if the same is subject to dividend distribution tax as referred to in section 115-O of the IT Act, as per the provisions of section 10(34) of the IT Act. The income chargeable under the head Capital gains shall be computed by deducting from the full value of consideration received on sale of securities or units, the cost of acquisition of the said securities or units and the expenditure incurred wholly and exclusively in connection with such sale. In case the full value of consideration is less than the cost of the acquisition and the expenditure incurred wholly and exclusively in connection with such transfer than it will result in a capital loss. However, section 94(7) of the IT Act provides that the capital loss arising on account of sale/transfer of securities or units purchased up to three months prior to the record date and sold within three months after such date (in case of securities) or within a period of nine months after such date (in case of units), would be disallowed to the extent to which dividend on such securities or units are claimed as exempt by the shareholder.

VI 1

VII

53

INCOME FROM CAPITAL GAINS 2.1 In terms of first proviso to section 48 of the IT Act, in case of a non-resident, while computing the capital gains arising from transfer of shares in or debentures of the Company acquired in convertible foreign exchange (as per exchange control regulations) protection is provided from fluctuations in the value of rupee in terms of foreign currency in which the original investment was made. Cost indexation benefit will not be available in such a case. The capital gains/ loss in such a case is computed by converting the cost of acquisition, sales consideration and expenditure incurred wholly and exclusively in connection with such transfer into the same foreign currency which was utilized in the purchase of shares. Provisions of section 10(38) of the IT Act, exempt the long term capital gains arising on sale of equity shares in the Company where the sale transaction has been entered into on a recognized stock exchange of India and has been liable to securities transaction tax. However, the income by way of long-term capital gain of the company is taken into account in computing the book profit and income tax payable under section 115JB of the IT Act. The provisions of section 112 of the IT Act, permit taxing long term capital gains [which are not exempt under Section 10(38) of the IT Act] arising on transfer of shares in the Company at a rate of 20 percent (plus applicable surcharge and education cess) after considering indexation benefit. However, the share holder may opt for the tax on long term gains computed at the rate of 10 percent (plus applicable surcharge and education cess), if the tax on indexed long term capital gains resulting on transfer of listed securities calculated at the rate of 20 percent (after indexation benefit) exceeds the tax on long term gains computed at the rate of 10 percent without considering indexation benefit. The provisions of section 111A of the IT Act, prescribes for taxing the shortterm capital gains arising from sale of equity share in a Company at a rate of 15 percent (plus applicable surcharge and education cess) where such transaction of sale is entered on a recognized stock exchange in India and is liable to securities transaction tax. Short term capital gains arising from transfer of shares in a company other than those covered by Section 111A of the IT Act would be subject to tax as calculated under the normal provisions of the IT Act. The provisions of the Double Taxation Avoidance Agreement between India and the country of residence of the non-resident would prevail over the provisions of the IT Act, as per section 90(2) of the IT Act; to the extent they are more beneficial to the non-resident.

2.2

2.3

2.4

2.5

54

2.6

The provisions of section 54EC of the IT Act exempts long-term capital gains [which are not exempt under section 10(38) of the IT Act] from being taxed to the extent such capital gains are invested in long term specified assets within a period of 6 months after the date of such transfer (presently, bonds issued by the National Highways Authority of India or the Rural Electrification Corporation Limited have been specified). Where only a part of the capital gains is so invested, the exemption is proportionately available. However, the investment in specified asset is limited to Rs 5 million. The minimum holding period in the prescribed investments to remain eligible for the exemption is 3 years. Subject to the conditions specified under the Provisions of section 54F of the IT Act, long-term capital gains (which are not exempt from tax under section 10(38) of the IT Act) arising to an individual or a HUF on transfer of shares of the Company will be exempt from capital gains tax if the sale proceeds from transfer of such shares are used for purchase of residential house property within a period of 1 year before or 2 years after the date on which the transfer took place or for construction of residential house property within a period of 3 years after the date of such transfer. Where shares of the Company have been subscribed in convertible foreign exchange, Non-Resident Indians (i.e. An individual being a citizen of India or person of Indian origin who is not a resident) have the option of being governed by the provisions of Chapter XII-A of the IT Act, which inter alia entitles them to the following benefits: Under section 115E of the IT Act, where the total income of a nonresident Indian includes any income from investment or income from capital gains of an asset other than a specified asset, such income shall be taxed at a concessional rate of 20 per cent (plus applicable surcharge and education cess). Also, where shares in the company are subscribed for in convertible foreign exchange by a non-resident Indian, long term capital gains arising to the non-resident Indian shall be taxed at a concessional rate of 10 percent (plus applicable surcharge and education cess). The benefit of indexation of cost and the protection against risk of foreign exchange fluctuation would not be available. Under section 115F of the IT Act, long-term capital gains [in cases not covered by section 10(38) of the IT Act] arising to a non-resident Indian from transfer of shares of the company, subscribed in convertible foreign exchange (in case not covered under Section 115E of the IT Act), shall be exempt from income tax, if the entire net consideration is reinvested in specified assets/saving certificates referred to in section 10(4B) within 6 months of the date of transfer. Where only a part of

2.7

2.8

55

the net consideration is so reinvested, the exemption shall be proportionately reduced. The amount so exempted shall be chargeable to tax subsequently, if the specified assets/saving certificates are transferred or converted into money within 3 years from the date of their acquisition. Under section 115G of the IT Act, it shall not be necessary for a nonresident Indian to furnish his return of income under Section 139(1) if his income chargeable under the IT Act consists of only investment income or long term capital gains or both, arising out of assets acquired, purchased or subscribed in convertible foreign exchange and tax has been deducted at source from such income as per the provisions of Chapter XVII-B of the IT Act. Under section 115I of the IT Act, a Non-Resident Indian may elect not to be governed by the foregoing provisions for any assessment year by furnishing his return of income for that assessment year under Section 139 of the IT Act, declaring therein that the provisions of Chapter XII-A shall not apply to him for that assessment year and accordingly his total income for that assessment year will be computed in accordance with the other provisions of the IT Act.

BENEFITS AVAILABLE UNDER THE WEALTH TAX ACT, 1957 1 Investment in shares of companies are excluded from the definition of the term asset as given under section 2(ea) of the Wealth Tax act, 1957, and hence the shares held by the shareholders would not be liable to Wealth tax.

BENEFITS AVAILABLE UNDER THE GIFT TAX ACT 1 Gift tax is not leviable in respect of any gifts made on or after 1st October, 1998. However, as per section 56(2)(vii)(c) of the IT Act, any individual or a HUF receives any shares or securities without consideration, the aggregate value of which exceeds Rs 50,000, than the whole of the aggregate fair market value of such shares and securities shall be chargeable to income-tax under the head Income from other sources. However, if the consideration received is less than the aggregate fair market value of the shares and securities by an amount exceeding Rs 50,000, than the aggregate fair market value of such property as exceeds such consideration. However, this section will not be applicable if the shares and securities are received from any relative or on the occasion of marriage of the individual or under will or by way of inheritance etc.

56

However, as per section 56(2)(viia) of the IT Act, any company not being a company in which the public are substantially interested receives on or after 1 June 2010, any property being the shares of a company in which the public are substantially interested without consideration, the aggregate value of which exceeds Rs 50,000, than the whole of the aggregate fair market value of such shares and securities shall be chargeable to income-tax under the head Income from other sources. However, if the consideration received is less than the aggregate fair market value of the shares and securities by an amount exceeding Rs 50,000, than the aggregate fair market value of such property as exceeds such consideration.

Notes: 1 The above Statement of Possible Direct Tax benefits sets out the provisions of law in a summary manner only and is not a complete analysis or listing of all potential tax consequences of the purchase, ownership and disposal of equity shares. The above Statement of Possible Direct Tax benefits sets out the possible tax benefits available to the Company and its shareholders under the current tax laws presently in force in India. Several of these benefits are dependent on the Company or its shareholders fulfilling the conditions prescribed under the relevant tax laws. This statement is only intended to provide general information to the investors and is neither designed nor intended to be a substitute for professional tax advice. In view of the individual nature of the tax consequences, the changing tax laws, each investor is advised to consult his or her own tax consultant with respect of the specific tax implications arising out of their participation in the issue. In respect of non-residents, the tax rates and the consequent taxation mentioned above shall be further subject to any benefits available under the Double Taxation Avoidance Agreement, if any, between India and the country in which the non-resident is resident.

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VIII. COMPANY HISTORY & MANAGEMENT

Zuari Agro Chemicals Limited (Company) was incorporated on 10th September 2009 under the Companies Act, 1956 (Companies Act). The corporate identity number assigned to our Company is U65910GA2009PLC006177. A. MAIN OBJECTS OF THE COMPANY:

The objects for which the Company has been established are set out in its Memorandum of Association. The relevant objects, inter alia, are set out hereunder: 1. To manufacture, produce, refine, process, formulate, mix or prepare, mine or otherwise acquire, invest in, own, hold, use, lease, mortgage, pledge, buy, sell, exchange, distribute, assign, transfer or otherwise dispose of, trade, deal in and deal with, import and export any and all classes and kinds of fertilisers, organic fertilisers, inorganic fertilisers, agricultural chemicals, manures, their mixtures and formulations and any and all classes and kinds of chemicals, source materials, ingredients, mixtures derivatives and compounds thereof, and any and all kinds of products of which any of the foregoing constitutes an ingredient or in the production of which any of the foregoing is used, including but not limited to water soluble fertilisers and agricultural and industrial chemicals of all kinds, and industrial and other preparations or products arising from or required in the manufacture, refining etc. of any kind of water soluble fertilisers, fertiliser, manure, their mixtures and formulations. To purchase, acquire, own, take lease and operate any land including agricultural land, farms, fields or to vest any real or personal property, rights or interests acquired by or belonging to the company in any person or company on behalf or for the benefit of the Company, for setting up of and engage in research and development centers, research stations, laboratories, green houses, processing centres for the purpose of development and improvement of the products including any poultry, animal products, sea foods, vegetables, fruits and fruit products and to use the acquired or leased land, for agricultural purposes including making land fit for cultivation, cultivation of land, improvement of land, development of sources of irrigation, raising and harvesting of crops, horticulture, forestry, planting and farming, cattle breeding, animal husbandry, dairy farming, seed farming, pisciculture, apiculture, sericulture, piggery, poultry farming and such other activities as are generally carried in relation to agriculture, dairy farming, cattle breeding, poultry farming and other categories in similar activities including marketing of agricultural products, their storage and transport and the acquisition of implements and machinery in connection with any such activity, which is necessity for carrying the business of the company. To carry on the business of manufacturer, producers, refiners, processors, miners, exporters, importers, buyers and sellers of, and dealers in and with all and any fats, dips, sprays, vermifuges, fungicides, insecticides, germicides, disinfecting preparations, fumigators, medicines and remedies of all kinds for agricultural, trees and fruit growing, gardening and other purposes and whether produced from vegetable, mineral, gaseous, animal or any other matters or substances by any process whether chemical, mechanical, electrical or otherwise.

2.

3.

58

B.

THE OBJECTS INCIDENTAL OR ANCILLARY TO THE ATTAINMENT OF THE MAIN OBJECTS:

To acquire, buy, hold, sell, transfer, hypothecate, deal in and dispose of properties of all kind and descriptions movable and immovable including shares, stocks, debentures stocks, bonds, obligations or securities by original subscription, tender, purchase, exchange, or otherwise and to subscribe for the same either conditionally or otherwise and to guarantee the subscription thereof and to exercise and enforce all rights and powers conferred by or incidental to the ownership thereof. To purchase, take on lease or licence or in exchange hire or otherwise any real and/ or personal property and any rights or privileges, which the Company may think necessary or convenient for the purposes of its business or may enhance the value of any other property of the Company.

C.

OTHER OBJECTS NOT INCLUDED IN "A" & "B" ABOVE:

To purchase, manufacture, produce, refine, mine or otherwise acquire, invest in, own, hold, use, lease, mortgage, pledge, sell, assign, transfer or otherwise dispose of, trade, deal in and deal with any and all kinds of chemicals and source materials, ingredients, mixtures, derivatives, and compounds thereof, and any and all kinds of products of which any of the foregoing constitutes and ingredient or in the production of which any of the foregoing is used, including but not limited to medicines, pharmaceuticals, fertilizers and industrial chemicals of all kinds. To explore, prospect, take on lease or on royalty basis or otherwise acquire mines, mining rights and lands or any interest therein and to quarry, mine, dress, reduce, draw, extract, caline, smelt, refine, manufacture, process and otherwise acquire, buy, sell or otherwise dispose of and deal in all types, qualities and descriptions of ores metal and mineral substances and to carryon any other metallurgical operations which may seem conducive to any of the Company's objects.

D. E.

The liability of the members is limited The authorized share capital of the Company is Rs. 42,05,80,060/- (Rupees [Forty Two Crores Five Lacs Eighty Thousand Sixty]) divided into 4,20,58,006 equity shares of Rs. 10 (Rs. Ten) each, with the rights, privileges and conditions attached thereto with the power to vary, modify or abrogate such rights, privileges and conditions as may be provided by the Articles of Association of the Company for the time being. The Board of Directors shall have the power to classify as and when required the shares as equity or preference shares and attach thereto respectively such preferential, deferred, qualified or special rights, privileges and conditions and also

59

the power to increase or reduce the capital of the Company as may be determined in accordance with the Articles of Association of the Company. Subsidiaries of the Company: 1. Zuari Seeds Limited 2. Zuari Fertilisers & Chemicals Limited Joint Ventures of the Company 1. Zuari Rotem Speciality Fertilisers Limited 2. Zuari Maroc Phosphates Limited Shareholders Agreement: NIL Strategic / Financial Partners and Other Material Contracts Joint Venture agreements between Maroc Phosphore S.A. & Rotem Amfert Negev Limited.

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Management: The overall management is vested in the Board of Directors, comprised of qualified and experienced persons.

Sr. No. 1.

Name Mr. S.K. Poddar

Address PODDAR NIKET, 2, GURUSADAY ROAD, CALCUTTA, 700019

Designation Director

Date of Appointment 20-05-2011

Other Directorships Held Areva T & D India Ltd, Zuari Cement Ltd, Chambal Infrastructure Ventures Ltd, Simon India Ltd, Chambal Fertilisers and Chemicals Ltd, Texmaco Infrastructure & Holdings Limited, Zuari Global Limited, Zuari Agro Chemicals Limited. Indian Potash Limited, Lionel India Limited, Paradeep Phosphates Limited, Simon India Limited, Style Spa Furniture Limited, Zuari Investment Limited, Zuari Maroc Phosphates Limited, Zuari Seeds Ltd, Zuari Global Ltd, Zuari Fertilisers & Chemicals Limited, Gobind Sugar Mills Limited. Zuari Maroc Phosphates Limited, Zuari Management Services Limited, Zuari Indian Oiltanking Limited, Zuari Investments Limited, Zuari Seeds Limited, Indian Furniture Products Limited, Adventz Infraworld India Limited, Gulbarga Cement Limited, Zuari Fertilisers & Chemicals Limited, Adventz Industries India

2.

Mr. Harbachan Singh Bawa

B-3, MAHARANI BAGH, NEW DELHI, 110065

Director

20-05-2011

3.

Mr. Suresh Krishnan

Zuari Industries, Residential Colony, Zuarinagar, 403726, Goa, INDIA

Director

10-09-2009

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4.

Mr. Jayant Godbole

604A, Cottage Land CoOperative Housing Society, Plot No.-16A, Sector-19, Navi Mumbai 400706

Director

20-05-2011

5.

Mr. Marco Wadia

THAKUR NIVAS, 173,, JAMSHEDJI TATA ROAD,, MUMBAI 400020

Director

20-05-2011

6.

Mr. Akshay Poddar

PODDAR NIKET, 2, GURUSADAY

Director

14-11-2011

Limited, Zuari Global Limited, Globex Limited, Gobind Sugar Mills Limited, Zuari Agro Chemicals Limited, Zuari Rotem Specility Fertilisers Limited. Zuari Global Limited,Zuari Agro Chemicals Limited, Embio Ltd., J. K. Cements Ltd, Gilander Arbuthnot Ltd., IMP Powers Ltd, Emami Paper Mills ltd, The Oudh Sugar Mills ltd, Madhya Bharat Papers Ltd, Saurashtra Cement Ltd, Gujarat Alkalies & Chemicals Ltd, Kesar Terminals & Infrastructure Ltd, IDBI Asset Management Ltd, Kesar Multimodal Logistics Ltd. Chambal Fertilisers & Chemicals Ltd, Josts Engineering Company Ltd, Johnson & Johnson Ltd, Paradeep Phosphates Limited, Stovec Industries Limited, Simon India Ltd, Zuari Maroc Phosphates Limited, Zuari Global Limited, Adventz Infraworld India Ltd, Zuari Agro Chemicals Ltd, Amphenol Interconnect India Pvt. Ltd, Amphenol Omniconnect India Pvt. Ltd, Amphetronix Offset Interconnect Solutions Pvt. Ltd., Gobind Sugar Mills Limited Zuari Global Limited, Texmaco Rail & Engineering Ltd,

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ROAD, CALCUTTA, 700019

7.

Mr. Arun Duggal

A-4, West End, New Delhi 110021

Director

27-03-2012

Mr. Gopal K Pillai

K-202, Plumeria Garden Estate, Sector Omicron III, Greater Noida 201 308 UTTAR PRADESH

Additional Director

30-07-2012

Gillette India Limited, Adventz Securities Enterprises Ltd, Texmaco Infrastructure & Holdings Limited, Syndak Teatech Limited, Paradeep Phosphates Limited, Lionel Edwards Limited, Style Spa Furniture Limited, Adventz Investments & Holdings Ltd, Zuari Agro Chemicals Limited. Zuari Global Limited, Zuari Agro Chemicals Limited Shriram Transport Finance Co. Limited, Info Edge (India) Limited, Shriram Properties Ltd., Dish TV India Limited, Shriram City Union Finance Limited, Adani Port and Special Economic Zone Limited, Shriram EPC Limited, Shriram Capital Ltd., FIL Fund Management Pvt. Ltd, Carzonrent (India) Pvt. Ltd , Bellwether Micr Finance Fund Pvt. Ltd, International Asset Reconstruction Co. Pvt. Ltd, Blackstone Investment Co. Pvt. Ltd., Tanglewood Financial Advisors Pvt Ltd., Jubilant Energy N.V. Netherlands, Jubilant Energy N.V. Canada, Mortice Ltd., Singapore. Adani Ports and SEZ Limited, Zuari Agro Chemicals Limited, Ivy Cap Advisors Pvt. Ltd.

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Other Details about Directors Sr. No. 1 2 3 4 5 6 7 8 Date of Birth 15/09/1945 20/03/1931 30/01/1956 17/12/1945 20/07/1976 03/06/1964 01/10/1946 30/11/1949

Name Mr. S. K. Poddar Mr. H. S. Bawa Mr. Macro Wadia Mr. Jayant Godbole Mr. Akshay Poddar Mr. N. Suresh Krishnan Mr. Arun Duggal Mr. Gopal K. Pillai

Qualification B.Com (Hons) M.S. Chemical Engineering B.A. (Hons)/ L.L.B. B.Tech (Hons) Chemical, P.G. Certificate in Financial Management Hons. In Accounting & Finance B. E. (Hons)/M.Sc. M.E./M.B.A. post graduation in Chemistry from IIT Madras with an MSc

DIN No. 00008654 00244222 00244357 00056830 00008686 00021965 00024262 02340756

Brief Profile of Directors of the Company: 1. Mr. S. K. Poddar Saroj Kumar Poddar, chairman of Zuari Agro Chemicals Ltd., is a gold medallist in B. Com (Hons) from Calcutta University. Mr. Poddar is the Chairman of numerous companies including Areva T & D India Ltd., Zuari Industries Limited, Zuari Cement Ltd., Chambal Infrastructure Ventures Ltd., Simon India Ltd., Chambal Fertilisers and Chemicals Ltd., and Texmaco Limited. He is also on the Board of Lionel India Ltd., Poddar Heritage Investments Ltd and Bengal Foodpark Ltd. Internationally, Mr Poddar is on the Board of Gillette Management Inc. Boston. He is also on the Advisory Board of M/s. N M Rothschild & Sons (India) Pvt. Ltd. Mr Poddar is also the Chairman of Poddar Heritage Enterprises. Under Mr. Poddar, the group has promoted various new projects including several joint ventures with leading international corporations. The most notable of these ventures are Gillette India Limited a joint venture with The Gillette Company of U.S.A., Indian Furniture Products Ltd. a joint venture with Seribo of France (now wholly owned subsidiary of Zuari Industries Ltd.) and Hettich India Pvt. Ltd a joint venture with the Hettich Group of Germany. Mr. Poddar is the immediate Past President of International Chamber of CommerceIndia. He has also served as President of Federation of Indian Chambers of Commerce and Industry, Indian Council of Arbitration, All India Organization of Employers (AIOE) and Council of Indian Employers (CIE). 2. Mr. H.S. Bawa Mr. H.S. Bawa is an Executive Vice Chairman of ZGL and Vice Chairman of the Company. He holds a MS Degree in Chemical Engineering from the University of Tulsa, USA. Mr Bawa has been the Vice-Chairman of Chambal Fertilisers and Chemicals Ltd.

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Mr. Bawa started his career with Bahrain Petroleum Company, Bahrain after getting his Masters degree in 1955. In 1957, he joined ESSO India (now Hindustan Petroleum Corporation Limited). He held senior position in ESSO in both India and overseas. In 1979, H S Bawa joined Zuari Global Limited (formerly Zuari Industries Limited) in Goa as the Executive President. H S Bawa has been the Chairman of the Fertiliser Association of India (FAI), which is the second largest fertiliser association in the world and is presently member of the International Fertiliser Association Council. Mr. Bawa is widely travelled and has participated in various key negotiations with potential business partners. He has led several committees in oil and fertiliser industries. 3. Mr. N. Suresh Krishnan Mr. N. Suresh Krishnan, Managing Director of the Company has 25 years of corporate experience in fertilisers, energy and cement sectors, Mr. Krishnan has been associated with Zuari Industries Limited (ZIL) and related companies over nearly two decades. Prior to taking over as Managing Director of ZHL, he was the Managing Director in ZIL since February 2011, Mr. Krishnan was Executive President of ZIL for three and a half years, responsible for the companys fertiliser business. Other senior position held by Mr. Krishnan includes Chief Financial Officer of the ZGL and Zuari Cement Limited for four years. His functional experience spans corporate finance, corporate strategy, projects planning, operations and business development. Over the years, he has been instrumental in financing of large greenfield projects in the domestic and international markets, forging and managing joint ventures and acquisitions, and in executing turnaround strategies alongside day-to-day operations in the manufacturing sector. Mr. Krishnan is on the Board of Directors of several ZIL subsidiaries and joint ventures including Zuari Investments Limited, Indian Furniture Products Limited and Zuari Maroc Phosphates Limited (Managing Director). Mr. N. Suresh Krishnan is an alumnus of BITS (Pilani). 4. Mr. J.N. Godbole Mr. J.N. Godbole is a chemical engineer from I I T Mumbai with qualifications in financial Management from Bajaj Institute of Management Studies, University of Bombay. Mr Godbole has 37 years of diversified experience ranging from Production-In-Charge in a private sector SSI, Development banker with IDBI the Apex term lending development bank of the Govt of India to Advisor to State Govt of Sabah in Malaysia. In Sabah he advised the Govt in the implementation of a $700 million pulp, paper and timber complex. He was also directly involved in implementation /project management of $ 1Billion gas based complex comprising transportation of associated gas, production of HBI, Methanol, and generation of power. In IDBI, Mr Godbole served in various departments including Project Finance, Venture capital, Rehabilitation of sick units, and various capacities from junior officer to Executive Director and finally functioned as the Chairman and Managing Director. He

65

chaired the Empowered Group of CDR (corporate Debt Restructuring) Mechanism during 2002 to 2004 and was instrumental in reviving and preventing the formation of about Non-performing Assets (NPAs) with debts of $ 17 Billion from the Indian Banking Sector. Currently Mr Godbole is an independent Director in companies engaged in the fields of Cement, Textiles Sugar, Power Sector, and Paper. 5. Mr. Marco Wadia Mr. Marco P.A. Wadia, is a partner in Crawford Bayley & Co., Advocates and Solicitors. He has about 26 years of experience in the legal profession having specialised in corporate matters and mergers and acquisitions. 6. Mr. Akshay Poddar Mr. Akshay Poddar, Executive Director of the Company hails from the family of a renowned Adventz group having glorious track record of promoting and managing businesses in diversified industries like Fertilizers, Agri inputs, Heavy Engineering, Process Engineering, Sugar Consumer Products, Real Estate, Investments and Furniture etc. The Adventz groups annual turnover is in excess of US $ 2.5 billion. The Adventz group believes in empowerment of farmers and securing interests of all stake holders. The Group Companies have won distinguished awards for practicing best CSR Activities, taking care of community services hand in hand with commercial activities and to conserve the environment. Mr. Akshay Poddar is Managing Director of Adventz Investments and Holdings Limited and also serves as Director on the Board of Group Companies and Associated Companies. The Group Companies includes Zuari Industries Limited, Texmaco Limited, Paradeep Phosphates Limited, Gobind Sugar Mills Limited, Style Spa Furniture Limited, Adventz Investments and Holdings Limited, Lionel India Limited, Adventz Securities Enterprises Limited, and Poddar Heritage Finance Private Limited. The Associate Companies includes Chambal Fertilizers & Chemicals Limited, CFCL Technologies Limited and JVs promoted by the Group like Gillette India Limited and Hettich India Private Limited. Mr. Akshay Poddar is Honors in Accounting & Finance from London School of Economics and Political Science, University of London. Mr. Akshay Poddar is also associated as a Member with Indian Chamber of Commerce, Kolkata, Entrepreneurs Organisation, Kolkata (Former President), Young Leaders Forum (YLF), The Indus Enterprises (TIE) etc. to name a few. 7. Mr. Arun Duggal A Mechanical Engineer from the prestigious Indian Institute of Technology Delhi, Mr. Arun Duggal holds an MBA from the Indian Institute of Management, Ahmedabad. He teaches Venture Capital & Private Equity at the Indian Institute of Management, Ahmedabad as a visiting professor.

66

Mr. Duggal is an experienced international Banker advising corporations on Financial Strategy, M&A and Capital Raising areas. He has been an International Advisor to a number of Corporations, major Financial Institutions and Private Equity firms. He is Chairman of Board of Directors of Shriram Transport finance Company, Shriram Properties Ltd., Shriram City Union finance Ltd., and Shriram EPC Limited. He is the Vice Chairman of International Asset Reconstruction Company. Mr Duggal is also on the Board of Directors of Jubilant Energy Ltd., Patni Computers (Chairman, Audit Committee), Fidelity Fund Management, (Nominee Director of Asian Development Bank), Manipal Acunova Limited, Info Edge (India), Dish TV India Ltd., Mundra Port & SEZ Ltd., and IMA (formerly Economist Intelligence Unit, India) and Hertz (India). He is a member of the Investment Committee of Axis Private Equity. Mr. Duggal is involved in several initiatives in social sector. He is the Chairman of Board of Directors of Bellwether Microfinance Fund that provides equity capital to promising Micro Finance organizations and helps them in capacity building. He is a Trustee of Centre for Civil Society, New Delhi, which focuses on improving the quality and access of education to students especially for the needy. Mr. Duggal is a Senior Advisor to TPG Capital, a major Private Equity firm headquartered in San Francisco. Mr. Duggal Mr. Duggal is also involved with a number of environmental projects. Mr. Duggal has had a 26 year career with Bank of America, mostly in the U.S., Hong Kong and Japan. His last assignment was as Chief Executive of Bank of America in India from 1998 to 2001. 8. Mr. Gopal Pillai Former Home Secretary, Ministry of Home Affairs, Government of India, Mr. Gopal K Pillai completed his early education in Delhi and Bangalore. Thereafter, Mr. Pillai did his post graduation in Chemistry from IIT Madras with an MSc. He joined the Indian Administrative Service (IAS) in 1972 and was allotted the Kerala Cadre. In the State Government, he held various positions as District Collector, Quilon, Special Secretary (Industries), Secretary (Health) and Principal Secretary to the then Chief Minister, AK Antony. At the Centre, Mr Pillai has had stints in the Ministries of Defence, Surface Transport, Home and Commerce. As Joint Secretary (North-East) in the Ministry of Home Affairs during 1996-2001, he developed a unique relationship with the Governments and people of the North-East and was involved in active negotiations with various insurgent groups, including the Bodo Liberation Tigers and the NSCN (I/M). During his five-year stint in the Department of Commerce, during 2004-09, including as Secretary (Commerce), Mr Pillai was actively involved as the Chief Negotiator for India at the WTO, in the negotiations for Comprehensive Economic Partnership Agreements with Singapore, Japan and South Korea, European Union, Australia, New Zealand, Malaysia and ASEAN for broadening engagements with SAARC and the African Continent. He was also instrumental in the enactment of the SEZ Act, 2005 and the setting up of over 140 Special Economic Zones in India which created over sixteen lakh jobs. Mr Pillai retired from the Government in June 2011. He is currently a Distinguished Fellow at the Institute for Defence Studies and Analyses (IDSA), RK Mishra Chair at the Observer Research Foundation, Chairman of Ivy Cap

67

Ventures Advisors Pvt Ltd and Chairperson of the University of Engineering and Management, Jaipur.

Shareholding of Directors as on date : Name of the Directors Mr. S.K. Poddar Mr. Marco Wadia Corporate Governance: The Company is fully compliant with the provisions of Clause 49 of the Listing Agreement and the details are as follows: a) Composition of Board of Directors: Name of the Directors Mr. Suresh Krishnan Mr. Akshay Poddar Mr. S.K. Poddar Mr. Jayant Godbole Mr. Marco Wadia Mr. Arun Duggal Mr. H.S. Bawa Mr. Gopal Pillai b) Composition of Audit Committee Mr. Arun Duggal Chairman Mr. Jayant Godbole Member Mr. Marco Wadia Member c) Composition of Shareholders/ Investor Grievance and Share Transfer Committee Mr. J. N. Godbole Chairman Mr. Marco Wadia Member Mr. H.S. Bawa Member Compliance Report on Corporate Governance as on 30th September, 2012: ZUARI AGRO CHEMICALS LIMITED Particulars I. Board of Directors (A) Composition of Board Clause of Listing Agreement 49 (I) 49 (IA) Compliance Status Yes/No. YES YES Remarks Category Managing Director Executive Director Promoter Director Independent & Non-Executive Director Independent & Non-Executive Director Independent & Non-Executive Director Professional Non- Executive Director Independent and Non-Executive Director Number of Shares held 79,406 2,811 % of Shares Total 0.19% 0.01%

Complied

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(B) Non-Executive Directors compensation & Disclosures

49 (IB)

YES

(C) Other provisions as to Board and Committees (D) Code of Conduct II. Audit Committee (A) Qualified & Independent Audit Committee (B) Meeting of Audit Committee (C) Powers of Audit Committee (D) Role of Audit Committee (E) Review of Information by Audit Committee III. Subsidiary Companies IV. Disclosures (A) Basis of related party transactions (B) Disclosures of Accounting Treatment (C) Board Disclosures (D) Proceeds from public issues, rights issues, preferential issues etc. (E) Remuneration of Directors (F) Management (G) Shareholders V. CEO/CFO Certification VI. Report on Corporate Governance VII. Compliance

49 (IC) 49 (ID) 49 (II) 49 (IIA) 49 (IIB) 49 (IIC) 49 (IID) 49 (IIE) 49 (III) 49 (IV) 49 (IVA) 49 (IVB) 49 (IVC) 49 (IVD) 49 (IVE) 49 (IVF) 49 (IVG) 49 (V) 49 (VI) 49 (VII)

YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES YES

Complied. No remuneration was paid to Nom-Executive Directors except sitting fees. Commission will be paid to non-executive directors upto Rs. 5 lacs per annum for a period of 5 years starting from financial year 2012-13 Complied Noted for Compliance. Will be adopted in ensuing Board Meeting. Complied Complied Complied Complied Complied Complied Complied As Per Accounting Standard Complied N.A. Complied Complied Complied N.A. Will be complied in Annual Report 2012-13 Will be complied in Annual Report 2012-13

the the

Change in Board of Directors since the Companys inception: Name of the Director Mr. Vijay Kathuria Mr. Binayak Datta Mr. Arun Mahajan Mr. Suresh Krishnan Date of Appointment 07/05/2010 10/09/2009 10/09/2009 10/09/2009 Date of Resignation 20/05/2011 24/05/2011 24/05/2011

69

Mr. H. S. Bawa Mr. S.K. Poddar Mr. J.N. Godbole Mr. Akshay Poddar Mr. Arun Duggal Mr. Marco Wadia Mr. Gopal Pillai

01/04/2012 M. D. 20/05/2011 27/03/2012 V.C. 20/05/2011 20/05/2011 14/11/2011 01/04/2012 E.D. 27/03/2012 20/05/2011 30/07/2012

Compensation of CEO and Whole Time Director Salary Rs. 4.50 lakhs per month, allowances & perquisites as per Sr. Executives of the Company Compensation of Executive Directors Salary Rs. 2.00 lakhs per month, allowances & perquisites as per Sr. Executives of the Company Interest of directors All our Directors may be deemed to be interested to the extent of fees payable to them, if any, for attending meetings of the Board or a committee thereof as well as to the extent of other remuneration, commission and reimbursement of expenses payable to them, if any, under the Articles of Association, and to the extent of remuneration paid to them, if any for services rendered as an officer or employee of our Company. Our Directors may also be regarded as interested in the Equity Shares, if any, held by them or by the companies/firms/ventures promoted by them or that may be allotted to the companies, firms, trusts, in which they are interested as Directors, members, partners, trustees and Promoter, pursuant to the Scheme. All Directors be deemed to be interested to the extent of any dividend payable to them and other distributions in respect of the said Equity Shares.

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IX. OVERVIEW OF ORGANISATION STRUCTURE Zuari Agro Chemicals Ltd.

Chairman

Vice Chairman

Executive Director

Managing Director

President Agri Business

Vice President Finance

Vice President Special Projects

Chief Manufacturing Officer

AdvisorCorporate Affairs

G.M (3)

CGMOperations GMManufacturing (1) DGM-IT (1) DGMF&A(1)

CGM-HR

CGM & CS

GMHR & IR (1)

DY.GM (8)

Dy.GM (2)

Dy.GM's (5)

Commercial

Finance

Special Projects

Operations

HR

Sec & Legal

CSR

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X. PROMOTER, PROMOTER GROUP, SUBSIDIARY COMPANIES AND COMPANIES UNDER SAME MANAGEMENT Shareholding Pattern of Company Prior to Scheme becoming Effective: Before the Scheme becoming effective, following were the shareholders and promoters of the Company: Name Promoter Zuari Industries Limited & Its nominees Promoter Group Zuari Management Services Limited & Its nominees Total Shares Held 8,411,601 4,205,801 12,617,402

1. 2.

Shareholding of Promoters and Promoter Group of the Company Post the Scheme becoming Effective: Sr. No Name of Shareholder Promoter 1. Zuari Industries Limited & its nominees Promoter Group 8,411,601 20% Shares % Holding

1. 2 3 4 5 6 7 8 9 10 11

Saroj Kumar Poddar Sarala Devi Birla Jyotsna Poddar SIL Investments Limited Pilani Investment Corporation Ltd RTM Investment & Trading Co. Ltd SCM Investment & Trading Co. Ltd. HTL Investment & Trading Co. Ltd. Shradhanjali Investment & Trading Co. Ltd. Ronson Traders Ltd. Usha Flowell Ltd

79,406 30,000 71,621 3,208,000 434,000 110,768 35,000 42,630 42,630 63,200 49,025

0.1888% 0.0713% 0.1702% 7.6275% 1.0319% 0.2633% 0.0832% 0.1013% 0.1013% 0.1502% 0.1165%

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Sr. No 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26.

Name of Shareholder Britex India Ltd Udit India Limited Texmaco Infrastructure and Holdings Limited Adventz Inv. & Holdings Ltd. Jeewan Jyoti Medical Society Poddar Heritage Finance Pvt. Ltd. Duke Commerce Ltd Ricon Commerce Ltd. New Eros Tradecom Ltd. UCO Bank (Birla Education Trust) Coltrane Corporation Limited Adventz Securities Enterprises Ltd. Adventz Investment Company Private Limited Globalware Trading & Holdings Limited Zuari Management Services Limited & its nominees Total

Shares 31,970 31,970 2,557,941 836,852 138,550 85,789 81,000 8,100 1,196,767 390,600 479,750 98,804 15,000 7,012,000 4,205,801 29,748,775

% Holding 0.0760% 0.0760% 6.0819% 1.9897% 0.3294% 0.2039% 0.1925% 0.0192% 2.8455% 0.9287% 1.1406% 0.2349% 0.0356% 16.6722% 10.0000% 70.73%

73

Details of the Promoter: Zuari Global Limited (Formerly known as Zuari Industries Limited) Its CIN is L65921GA1967PLC000157 Name the Company of Address the Company and contact number Zuari Global Limited Jai Kisaan Bhawan, Zuarinagar, Goa 403726 Fertiliser Manufacturing 1. SAROJ KUMAR PODDAR 2. AKSHAY PODDAR (alternate to SHYAM SUNDER BHARTIA) 3. SHYAM SUNDER BHARTIA 4. NARAYANAN KRISHNAN 5. ARUN DUGGAL 6. DADI BEJONJI ENGINEER 7. JYOTSNA PODDAR 8. Jayant Narayan Godbole 9. HARBACHAN SINGH BAWA 10. 11. MARCO PHILIPPUS ARDESHIR WADIA SHASHINDRA PAL TYAGI SURESH its of Business activity Details of listings, if any The Companys Board of Directors

Shareholding Pattern
The shareholding pattern of Zuari Global Limited as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters Shares % Holding

13134843 12163994

58.68 41.32

Change in Management
There has been no change in the management of Zuari Global Limited in the last 3 years.

Financial Performance
The summary audited financial information of Zuari Global Limited on standalone basis is as follows: (in Rs. Lacs)

74

S. No. March 31, 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure (P & L Debit Balance) Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares

For the year ended March 31, 2011 2944.11 1,19,095.10 NIL 122,039.21 5,52,315.22 16,687.53 March 31, 2010 2944.11 1,03,942.19 NIL 106,886.30 4,27,772.18 15,696.10

2944.11 54817.84 0.00 57761.95 130207.90 4755.99

16.15 16.15 196.20 29,440,604

56.68 56.68 414.52 29,440,604

53.31 53.31 363.05 29,440,604

The summary audited financial information of Zuari Global Limited on Consolidated basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31, 2012 March 31, 2011 March 31, 2010 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 NAV per Share 74.01 74.01 235.04 84.07 84.07 540.61 86.14 86.14 461.82 2,944.11 66,253.52 0.00 69,197.63 194,532.54 21,788.67 2944.11 1,56,217.36 NIL 159,161.47 7,43,530.21 26,521.13 2944.11 1,33,018.66 NIL 135,962.77 5,89,583.51 26,809.98

75

No. of Equity Shares

29,440,604

29,440,604

29,440,604

Zuari Global Limited is not a Sick Industrial Company within the meaning of the SICA. Share price Performance

BSEData
Month October September August July June May April NSE Data Month October September August July June May April High Price 154.40 151.00 148.25 140.85 147.80 164.95 529.00 High Price 154.80 151.00 148.20 141.00 148.10 165.00 529.00 Date of High 11-Oct-2012 21-Sep-2012 10-Aug-2012 31-Jul-2012 12-Jun-2012 02-May-2012 04-Apr-2012 Date of High 11-Oct-2012 21-Sep-2012 10-Aug-2012 11-Jul-2012 12-Jun-2012 02-May-2012 04-Apr-2012 Low Price 121.00 133.00 128.45 123.60 120.20 126.05 154.00 Low Price 121.10 132.35 129.15 122.90 121.45 111.65 153.90 Date of Low 31-Oct-2012 06-Sep-2012 28-Aug-2012 03-Jul-2012 04-Jun-2012 31-May-2012 25-Apr-2012 Date of Low 31-Oct-2012 07-Sep-2012 28-Aug-2012 04-Jul-2012 04-Jun-2012 31-May-2012 16-Apr-2012

76

Details of Promoter Group: Chambal Fertilisers and Chemicals Limited CIN is L24124RJ1985PLC003293. Name the Company of Address the Company and contact number Chambal Fertilisers and Chemicals Limited Gadepan, District Kota, Rajasthan, PIN 325208 Chambal Fertilisers has three divisions - agri-inputs, shipping and textiles BSE code 500085 National Stock India (NSE) Chamblfert Ltd. 1. SAROJ KUMAR PODDAR 3. SHYAM SUNDER BHARTIA 4. CHANDRA SHEKHAR NOPANY 5. KASHI NATH MEMANI Ltd. 7. MARCO PHILIPPUS ARDESHIR WADIA 9. RADHA SINGH its of Business activity Details listings, any of if The Companys Board of

Directors

(BSE) Stock 2. DIPANKAR BASU

Exchange of 6. ANIL KAPOOR

Stock code 8. RAM NATH BANSAL

Shareholding Pattern
The shareholding pattern of Chambal Fertilisers and Chemicals Limited as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters No. of Shares % Holding

229,341,482 186,866,370

55.12 44.88

77

There has been no change in the management of Chambal Fertilisers and Chemicals Limited in the last 3 years. The summary audited financial information of Chambal Fertilisers and Chemicals Limited on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31,2012 March 31, 2011 March 31, 2010 1 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares

Change in Management

Financial Performance

41,620.79 136,249.80

41,620

41,620

2 3 4 5 6 7

120,711 NIL 162,331 464,640 32,518

97,385 NIL 139,005 357,450 24,905

NIL 177,870.59 646,128.50 24,728.69

5.94 5.94 42.74 416,207,852

7.81 7.81 39.00 416,207,852

5.98 5.98 33.40 416,207,852

The summary audited financial information of Chambal Fertilisers and Chemicals Limited on Consolidated basis is as follows: (in Rs. Lacs) S. No. For the year ended

March31, 2012
1 2 Equity Capital Reserves (excluding revaluation reserves) and

March 31, 2011 41,620 115,603

March 31, 2010 41,620 101,721

41,620.79 128,495.08

78

surplus 3 4 5 6 7 Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares

NIL 170,115.87 753,817.33 15,830.85

NIL 157,223 567,795 21,646

NIL 143,341 412,734 20,730

3.80 3.80 40.87 416,207,852

5.78 5.78 37.77 416,207,852

5.22 5.22 34.44 416,207,852

Chambal Fertilisers and Chemicals Limited is not a Sick Industrial Company within the meaning of the SICA. Share price Performance

BSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012 NSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012

HighPrice 75.40 76.75 74.70 81.75 79.45 76.80 84.75

DateofHigh 03Oct2012 28Sep2012 08Aug2012 06Jul2012 14June2012 02May2012 10April2012

LowPrice 66.05 65.85 62.05 68.20 68.20 66.30 73.25

DateofLow 31Oct2012 03Sep2012 30Aug2012 30Jul2012 04June2012 09May2012 27April2012

HighPrice 75.45 76.65 74.65 81.90 79.45 76.80 84.80

DateofHigh 03Oct2012 28Sep2012 08Aug2012 06Jul2012 14June2012 02May2012 10April2012

LowPrice 65.90 65.85 62.05 68.20 68.25 66.15 73.05

DateofLow 25Oct2012 03Sep2012 30Aug2012 30Jul2012 04June2012 09May2012 27April2012

79

Texmaco Infrastructure & Holdings Limited CIN is L70101WB1939PLC009800 Name of the Company Address of the Company and contact number Texmaco Infrastructure & Holdings Limited Belgharia, Kolkata, West Bengal Infrastructure and Real Estate Bombay Stock Exchange (BSE) Stock : 505400 The National Stock Exchange (NSE) Stock code code 1. SAROJ KUMAR PODDAR 2. AKSHAY PODDAR 3. GAUTAM KHAITAN 4. UTSAV PAREKH 5. DIPANKAR CHATTERJI 6. HEMANT KUMAR its Business activity Details listings, any of if The Companys Board of Directors

TEXINFRA Calcutta Stock Exchange

Shareholding Pattern The shareholding pattern of Texmaco Infrastructure & Holdings Limited as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters No. of Shares % Holding

69,434,997 57,991,593

54.49 45.51

Change in Management There has been no change in the management of Texmaco Infrastructure & Holdings Limited in the last 3 years. Financial Performance The summary audited financial information of Texmaco Infrastructure & Holdings Limited on standalone basis is as follows:

80

(in Rs. Lacs) S. No. Particulars For the year ended March 31, 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares March 31, 2011 1271.83 21772.24 -23044.07 1198.88 760.80 March 31, 2010 1271.83 52975.05 -54249.88 112549.43 9304.48

1274.28 23495.26 24769.53 1278.83 1892.60

1.49 1.49 127426590

0.60 0.59 -127183090

7.63 7.61 -127183090

The summary audited financial information of Texmaco Infrastructure & Holdings Limited on Consolidated basis is as follows: (in Rs. Lacs) S. For the year ended Particulars No. March 31,2012 March 31, March 31, 2011 2010 1271.83 1271.83 1 Equity Capital 1274.28 2 3 4 5 6 7 Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares

39284.10 40558.38 1666.58 1925.84

34758.91 -36030.74 2769.89 800.72

53135.26 -54407.09 112588.51 9351.98

3.69 3.69 127426590

3.49 3.48 -127183090

7.66 7.65 -127183090

81

Texmaco Infrastructure & Holdings Limited is not a Sick Industrial Company within the meaning of the SICA. Share price Performance The shares of the Company have been listed with Calcutta Stock Exchange and the shares have not been traded in the Calcutta Stock Exchange Limited during last 6 months. Share price performance

BSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012 NSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012

HighPrice DateofHigh LowPrice 41.25 04Oct2012 36.80 14Sep2012 28.70 02Aug2012 31.65 17July2012 29.40 29June2012 31.60 02May2012 37.45 20Apr2012

33.35 26.50 25.00 27.00 26.05 26.40 26.10

DateofLow 01Oct2012 10Sep2012 30Aug2012 31July2012 04June2012 15May2012 04Apr2012

HighPrice DateofHigh LowPrice 41.30 04Oct2012 36.85 14Sep2012 28.90 02Aug2012 30.40 09Jul2012 29.20 29Jun2012 31.50 03May2012 37.80 20Apr2012

33.80 26.55 26.30 27.30 26.65 26.55 26.15

DateofLow 29Oct2012 06Sep2012 09Aug2012 31Jul2012 04Jun2012 31May2012 04Apr2012

82

Ricon Commerce Limited CIN is L51909WB1982PLC035269

Name the Company of Address of the Company its number and contact Business activity Details of The Companys Board of

listings, if any

Directors

Ricon Commerce Limited

Regd Office: 9/1 RN MUKHERJEE ROAD 5 FLOOR, KOLKATA 700001

TH

Investment Activity

Kolkata Stock Exchange 28171 Stock code

1. KAILASH CHAND GUPTA 2. TOLARAM CHACHAN 3. VINAY VARMA

Shareholding Pattern The shareholding pattern of Ricon Commerce Limited as on March 31, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters No. of Shares % Holding

225330 14670

93.89 6.11

Change in Management There has been no change in the management of Ricon Commerce Limited in the last 3 years. Financial Performance The summary audited financial information of Ricon Commerce Limited on standalone basis is as follows: (in Rs. Lacs) S. For the year For the year ended No. ended

March31,2012
1 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales (Dividend

March 31, 2011 24.00

March 31, 2010 24.00

24.00

2 3 4 5

64.11

62.32 NIL 86.32 3.22

60.59 NIL 84.59 2.95

88.11

83

6 7

Received and Profit on sale of Investments) Profit/(Loss) after tax Earnings per share - Basic - Diluted

1.79

1.72

1.00

0.75 0.75 36.71 2,40,000

0.72 0.72 35.96 240,000

0.42 0.42 35.24 240,000

8 9

NAV per Share No. of Equity Shares

The company does not have any subsidiaries, hence it does not have consolidated accounts. Ricon Commerce Limited is not a Sick Industrial Company within the meaning of the SICA. Share price Performance of Ricon Commerce Limited There have not been trades in the Equity Shares of Ricon Commerce Limited on The Calcutta Stock Exchange Limited and U.P Stock Exchange Limited during last 7 months. The last traded price of the Company is Rs. 4.50

84

Ronson Traders Limited CIN is L51909WB1982PLC035358 Name the Company of Address of the Company and its contact number Ronson Traders Limited Regd Office: 9/1 R N MUKHERJEE ROAD 5 FLOOR, KOLKATA 700001 Shareholding Pattern The shareholding pattern of Ronson Traders Limited as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters No. of Shares % Holding
TH

Business activity

Details listings, any

of if

The

Companys

Board

of

Directors

Investment Activity

Kolkata Stock Exchange 28184

1. 2. 3. 4. 5.

CHANDRA SHEKHAR NOPANY SHOBHANA BHARTIA NOPANY NANDINI JYOTSNA PODDAR SANTOSH PODDAR KUMAR

Stock code

527380 45620

92.04 7.96

Change in Management There has been no change in the management of Ronson Traders Limited in the last 3 years. Financial Performance The summary audited financial information of Ronson Traders Limited on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31, 2012 1 2 3 4 5 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales (Dividend Received and 57.30 2514.64 -2571.94 -March 31, 2011 57.30 2352.00 -2409.30 -March 31, 2010 57.30 2083.30 -2140.60 --

85

6 7

Profit on sale of Investments) Profit/(Loss) after tax Earnings per share - Basic - Diluted NAV per Share No. of Equity Shares

192.29

305.01

577.52

8 9

33.56 33.56 448.85 5,73,000

53.23 53.23 420.47 5,73,000

101.46 101.46 373.58 5,73,000

The summary audited financial information of Ronson Traders Limited on Consolidated basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31, 2012 1 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales (Dividend Received and Profit on sale of Investments) Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares March 31, 2011 57.30 March 31, 2010 57.30

57.30

2 3 4 5

2514.64

4637.22 NIL 4694.52 819.99

4081.71 NIL 4139.01 981.88

2571.94

595.67 889.64

6 7

192.29

33.56 33.56 448.85 5,73,000

103.96 103.96 819.28 5,73,000

155.26 155.26 722.34 5,73,000

Ronson Traders Limited is not a Sick Industrial Company within the meaning of the SICA. Share price Performance of Ronson Traders Limited

86

TherehavenotbeentradesintheEquitySharesofRonsonTradersLimitedonTheCalcutta StockExchangeLimitedandU.PStockExchangeLimitedduringlast7months.Thelasttraded priceoftheCompanyisRs.8.00

87

ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED CIN is : U51909WB1994PTC062183 Name of the Company Address the Company and contact number ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED HONGKONG HOUSE, 31, B.B.D. BAGH (SOUTH), KOLKATA, WEST BENGAL INDIA 700 001 (033) 22488891/92 Investment & Financing Unlisted 1. AKSHAY PODDAR 2. DEVENDRA KHEMKA 3. BIHARI LAL KANOONGO its of Business activity Details of listings, if any The Companys Board of Directors

Shareholding Pattern
The shareholding pattern of ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters Shares % Holding

732500 NIL

100% NIL

Change in Management

Mrs.ShradhaAgarwalawasappointedasDirectoroftheCompanyw.e.f.8thMay,2012.

88

Financial Performance
The summary audited financial information of ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No March 31, March 31, March 31, 2012 2011 2010 Equity Capital 73.25 73.25 73.25 1 Preference Share Capital (@ 660.00 660.00 660.00 Rs.100/- each) Reserves (excluding revaluation 2 1433.38 1630.74 1495.09 reserves) and surplus 3 4 5 6 7 Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earning per share (in Rs.) - Basic - Diluted 8 9 NAV per Share (in Rs.) No. of Equity Shares

NIL 1568.34 80.38 61.71

1506.63 (196.55)

1703.99 15.54

8.42 8.42 213.96 732500

(26.84) (26.84) 205.54 732500

2.12 2.12 222.47 732500

ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED is not a Sick Industrial Company within the meaning of the SICA. The company does not have any subsidiaries, hence it does not have consolidated accounts. The company is not listed.

89

ADVENTZ SECURITIES ENTERPRISES LIMITED Its CIN is L36993WB1995PLC069510 Name of the Address of Business Company the Company and contact number ADVENTZ SECURITIES ENTERPRISES LIMITED HONGKONG HOUSE, 31, B.B.D. BAGH (SOUTH), KOLKATA, WEST BENGAL INDIA 700 001 (033) 22488891/92 Investment & Financing Listed (CSE & DSE) 1. AKSHAY PODDAR 2. GAURAV AGARWALA 3. PIYUSH KUMAR KHETAN 4. REWATI RAMAN GOENKA its activity Details of listings, if any The Companys Board of

Directors

Shareholding Pattern
The shareholding pattern of ADVENTZ SECURITIES ENTERPRISES LIMITED as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters Shares % Holding

4021415 1606372

71.46% 28.54%

Change in Management
There has been no change in the management of ADVENTZ SECURITIES ENTERPRISES LIMITED in the last 3 years.

90

Financial Performance
The summary audited financial information of ADVENTZ SECURITIES ENTERPRISES LIMITED on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31, March 31, March 31, 2011 2010 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earning per share (in Rs.) - Basic - Diluted 8 9 NAV per Share (in Rs.) No. of Equity Shares

562.78 980.75 NIL 1543.53 101.96 30.35

562.78 950.40 1513.18 46.03

562.78 904.37 1467.15 14.52

0.54 0.54 27.43 5627787

0.82 0.82 26.89 5627787

0.26 0.26 26.07 5627787

The company does not have any subsidiaries, hence it does not have consolidated accounts. ADVENTZ SECURITIES ENTERPRISES LIMITED is not a Sick Industrial Company within the meaning of the SICA. Share price Performance

There have not been trades in the Equity Shares ADVENTZ SECURITIES ENTERPRISES LIMITED on THE CALCUTTA STOCK EXCHANGE LIMITED AND DELHI STOCK EXCHANGE LIMITED during last 6 months.

91

ADVENTZ INVESTMENTS AND HOLDINGS LTD. Its CIN is L51226WB1985PLC039055 Name of the Address of Business Company the Company and contact number ADVENTZ INVESTMENTS AND HOLDINGS LTD. HONGKONG HOUSE, 31, B.B.D. BAGH (SOUTH), KOLKATA, WEST BENGAL INDIA 700 001 (033) 22488891/92 Investment & Financing and Rental Income Listed (CSE & UPSE) 1. SAROJ KUMAR PODDAR Chairman 2. AKSHAY PODDAR Managing Director 3. SANTOSH KUMAR RUNGTA 4. JYOTSNA PODDAR 5. RAMESH MAHESHWARI 6. SATYA NARAYAN KHAITAN its activity Details of listings, if any The Companys Board of

Directors

Shareholding Pattern
The shareholding pattern of ADVENTZ INVESTMENTS AND HOLDINGS LTD. as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters Shares % Holding

5265727 197597

96.39% 3.61%

92

Change in Management
There has been no change in the management of ADVENTZ INVESTMENTS AND HOLDINGS LTD. in the last 3 years. The summary audited financial information of ADVENTZ INVESTMENTS AND HOLDINGS LTD. on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No. March 31, March 31, March31, 2011 2010 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earning per share (in Rs.) - Basic - Diluted 8 9 NAV per Share (in Rs.) No. of Equity Shares

Financial Performance

546.33 6968.86 NIL 7515.19 1251.49 664.82

546.33 6307.92 6854.25 220.20

546.33 6086.85 6633.18 623.27

12.17 12.17 137.57 5463324

4.03 4.03 125.47 5463324

11.41 11.41 121.42 5463324

The company does not have any subsidiaries, hence it does not have consolidated accounts. ADVENTZ INVESTMENTS AND HOLDINGS LTD. is not a Sick Industrial Company within the meaning of the SICA. Share price Performance There have not been trades in the Equity Shares ADVENTZ INVESTMENTS AND HOLDINGS LIMITED on CALCUTTA STOCK EXCHANGE LIMITED AND U.P. STOCK EXCHANGE LIMITED during last 7 months.

93

SIL Investment Limited Its CIN is. L17301RJ1934PLC002761

Name the Company SIL Investment Limited of Address of the Company and its contact NBFC number Pachapahar Road, Bhawanimandi 326502 (Raj) Business activity Details of listings, if any BSE, NSE, CSE (Applied for delisting) 1. Shri. C.S. Nopany Chairman 2. Smt. Shalini Nopany Managing Director 3. Shri. Arvind C. Dalal Director 4. Shri. S.M. Agarwal Director 5. Shri. Sanjay Goenka - Director 6. Shri. Subroto Lahiri Director 7. Shri. S.K. Khandelia Director in charge 8. Shri. S.S. Maheshwari Director The Companys Board of Directors

Shareholding Pattern
The shareholding pattern of SIL Investment as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters Shares % Holding

6648160 3947700

62.74 37.26

Change in Management
There has been no change in the management of SIL Investment Limited in the last 3 years. There is no change in management.

Financial Performance
The summary audited financial information of SIL Investment Limited on standalone basis is as follows: S. No. (in Rs. Lacs except No. of shares) For the year ended

March31, 2012
1 Equity Capital

March 31, 2011 1061

March 31, 2010 1061

94

1060.65
2 3 4 5 6 7 Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share/Net worth per share No. of Equity Shares

13692.54 1936.05 14735.18 3010.28 1032.92

12814 1051 13875 2055 937

12000 1156 13061 1917 767

9.75 9.75 Rs.139.24 10595860

8.84 8.84 131 10,595,860

7.23 7.23 123 10,595,860

The summary audited financial information of SIL Investments Limited on Consolidated basis is as follows: (in Rs. Lacs except No of Shares) S. No. March 31, 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares 9.75 9.75 Rs. 139.24 10595860 8.66 8.66 151 10595860 7.23 7.23 144 10595860 1060.65 13692.54 1936.05 14735.18 3010.28 1032.92 For the year ended March 31, 2011 1061 14950 1096 106011 2111 917 March 31, 2010 1061 14156 1197 15217 1975 766

95

SIL Investments Limited is not a Sick Industrial Company within the meaning of the SICA.

Share price Performance SIL Investments Limited is also listed on Calcutta Stock Exchange Limited but there is no trading of the stock in Calcutta Stock Exchange Limited during the last 7 months. BSE Data

Month October2012 September2012 August2012 July2012 June2012 May2012 April2012 NSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012

HighPrice DateofHigh LowPrice 75.10 01Oct2012 75.20 24Sep2012 82.00 07Aug2012 83.00 18July2012 71.00 29June2012 84.75 04May2012 85.90 28Apr2012 HighPrice DateofHigh LowPrice 74.60 01Oct2012 76.90 03Sep2012 82.95 08Aug2012 79.05 13Apr2012 70.95 29Jun2012 78.95 10May2012 80.90 13Apr2012

65.60 63.10 64.55 65.30 60.05 61.30 68.20

DateofLow 12Oct2012 03Sep2012 16Aug2012 02July2012 11June2012 24May2012 03Apr2012

66.00 62.55 65.05 63.80 59.75 61.30 68.00

DateofLow 12Oct2012 03Sep2012 16Aug2012 05Jul2012 20Jun2012 18May2012 11Apr2012

96

Promoter Group Persons Mr. Saroj Kumar Poddar, aged, 67, is the Chairman of Zuari Agro Chemicals Limited. He is a gold medalist in B. Com (Hons) from Calcutta University, recipient of Rashtriya Samman from Central Board of Direct Taxes, is the Chairman of Poddar Heritage Enterprises. Under Mr. Poddar, the group has promoted various projects including joint ventures with leading international corporations. The most notable of these ventures are Gillette India Ltd.- a joint venture between The Saroj Kumar Poddar Gillette Company of U.S.A. and Hettich India Private Limited, a joint venture with the Hettich Group of Germany. Mr. Poddar is the Chairman of these joint ventures. Besides above, Mr. Poddar is the Chairman of Chambal Fertilisers & Chemicals Limited, Chambal Infrastructure Ventures Limited, Simon India Limited, Texmaco Limited, Zuari Cement Limited and Zuari Industries Limited. Internationally, Mr. Poddar is on the Board of Gillette Management Inc, Boston. He is also on the Advisory Board of M/s N M Rothschild & sons India Pvt. Ltd. He served on the local Board of RBI for more than 10 years and was also on the Board of Governors of IIT, Kharagpur. Mr. Poddar is the Chairman of India - Saudi Arabia Joint Business Council, Member of the Indo-French CEO Forum, Board of Trade, Ministry of Commerce and a Member of the Court, Indian Institute of Science, Bangalore. Mr. Poddar is the Past President of Federation of Indian Chambers of Commerce and Industry (FICCI), International Chamber of Commerce- India, Indian Council of Arbitration, All India Organization of Employers (AIOE) and Council of Indian Employers (CIE).

97

Mr Akshay Poddar, aged 36 years is the Whole-Time Director, Zuari Agro Chemicals Limited. He graduated from London School of Economics & Political Science is the Managing Director of Poddar Heritage Investments Ltd. Apart from this, he is on the Board of Gillette India Ltd., Texmaco Ltd., Paradeep Phosphates Ltd., Gobind Sugar Mills Ltd., CFCL Technologies Ltd., Stylespa Furniture Ltd., Lionel Akshay Poddar Edwards Ltd., Poddar Heritage Corp Ltd. He is also holding directorship in several Private Limited companies. Mr. Poddar is the Past President of Entrepreneurs Organization - Kolkata Chapter. He is also Committee

Member of Indian Chamber of Commerce, Young Leaders Forum, The Indus Entrepreneurs and Member of Young Presidents Organization. Mrs. Jyotsna Poddar, a Psychology Honors student from Loreto House, Kolkata, is the Chairperson of Lionel India Limited, and is actively involved in providing strategic direction to the company. She is also a Director of Poddar Heritage Investments Ltd and Chairperson & MD of Gobind Sugar Mills, one of Indias primary sugar manufacturing companies Jyotsna Poddar Limited. She is the wife of Mr Saroj Kumar Poddar, past President of Federation of Indian Chambers of Commerce & Industry and daughter of Late Dr. K.K. Birla, one of Indias leading industrialists and an ex member of Parliament. A person with wide and diverse interests, Mrs. Poddar has a passion for cricket and runs a trust Young Cricketers Organization. This trust promotes young cricketing talent and supports former cricketers. Mrs. Poddar has also authored a book Cricketing Memories. Mrs. Poddar is an active social worker, and she runs a private trust - Jiwan Jyoti Medical Society, which provides free medical facilities to the economically disadvantaged. Mrs. Poddar is also an active Rotarian. and Whole Time Director of Zuari Industries

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Other Details about Individual Promoters Voter Id Number Saroj Kumar Poddar DWK 1138007 Driving License No. WB01196593238 J 0111667 Valid till 08.04.2020 Passport No. Bank Account NumberRoyal Bank of Scotland, Brabourne Road Branch, Kolkata A/c 123181 Akshay Poddar DWK1135508 WB012005252080 H2424069 valid till 18.01.2019 Royal Bank of Scotland, Brabourne Road Branch, Kolkata A/c 1014183 Jyotsna Poddar WB/23/ 146/210010 H9163954 valid till 17.12.2019 State Bank of Mysore, Bentinck Street Branch, Kolkata A/c 54027989490 AFGPP2539E AFUPP0096C Permanent Account Number AFTPP2386N

In addition, following also form part of the Promoter Group: 1 2 3 4 5 6 7 ZUARI MANAGEMENT SERVICES LTD NOMINEE PODDAR HERITAGE FINANCE PRIVATE LIMITED DUKE COMMERCE LIMITED RTM INVESTMENT AND TRADING CO. LTD. SCM INVESTMENTS & TRADING CO. LTD. HTL INVESTMENT AND TRADING COMPANY LIMIT JEEWAN JYOTI MEDICAL SOCIETY

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8 9 10 11 12 13 14 15 16 17 18

SHRADHANJALI INVESTMENT AND TRADING CO. UDIT (INDIA) LIMITED BRITEX (INDIA) LTD USHA FLOWELL LTD ADVENTZ INVESTMENT COMPANY PRIVATE LIMITED NEW EROS TRADECOM LIMITED BIRLA EDUCATION TRUST COLTRANE CORPORATION LIMITED GLOBALWARE Trading & HOLDINGS LIMITED PILANI INVESTMENTS LIMITED SARALA DEVI BIRLA

Group Companies: Texmaco Rail & Engineering Limited CIN is L29261WB1998PLC087404 Name of the Company Address the Company and contact number TEXMACO RAIL LIMITED & ENGINEERING BELGHARIA, KOLKATA, West Bengal Manufacture of Railway Wagons and Heavy Engineering Structures Bombay Stock Exchange (BSE) The National Stock Exchange (NSE) TEXRAIL Stock code Stock code 533326 (TREL) 1. SAROJ KUMAR PODDAR 2. AKSHAY PODDAR 3. AMOL CHANDRA CHAKRABORTTI 4. Ramesh Maheshwari 5. HEMANT KANORIA 6. KAARTHIKEYAN DEVARAYAPURAM RAMASAMY 7. DAMODAR HAZARIMAL KELA 8. SAMPATH DHASARATHY its of Business activity Details listings, any of if The Companys Board of Directors

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Shareholding Pattern The shareholding pattern of TEXMACO RAIL & ENGINEERING LIMITED as on September 30, 2012 is as follows Sr. No 1. 2. Name of Shareholder Promoters Non Promoters No. of Shares % Holding

11,51,27,010 6,68,99,580

63.25 36.75

Change in Management There has been no change in the management of TEXMACO RAIL & ENGINEERING LIMITED in the last 3 years. Financial Performance The summary audited financial information of TEXMACO RAIL & ENGINEERING LIMITED on standalone basis is as follows: (in Rs. Lacs) For the year ended Particulars March 31,2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares March 31, 2011 1,817.83 41,813.06 NIL March 31, 2010 546.00 (10.80) NIL 535.20 NIL (9.25)

S. No.

1,820.28 47,837.94

49,658.21 76,743.36 9,305.72

43,630.89 93,855.07 12,147.60

5.11 5.11 182,026,590

6.68 6.67 24.00 181,783,090

(0.15) (0.15) 0.98 54,600,000

The company does not have any subsidiaries, hence it does not have consolidated accounts. TEXMACO RAIL & ENGINEERING LIMITED is not a Sick Industrial Company within the meaning of the SICA.

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Share price Performance Texmaco Rail and Engineering Limited is also listed on Calcutta Stock Exchange Limited but there is no trading of the stock in Calcutta Stock Exchange Limited during the last 7 months.

BSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012 NSEData Month October2012 September2012 August2012 July2012 June2012 May2012 April2012

HighPrice DateofHigh LowPrice 68.45 08Oct2012 68.90 24Sep2012 54.75 01Aug2012 59.80 06Jul2012 59.00 27Jun2012 61.50 02May2012 63.05 20April2012

59.30 47.05 48.00 50.00 50.45 50.05 57.00

DateofLow 01Oct2012 11Sep2012 09Aug2012 30Jul2012 06Jun2012 15May2012 24April2012

HighPrice DateofHigh LowPrice 67.95 08Oct2012 66.00 24Sep2012 54.70 01Aug2012 60.80 06July2012 58.75 27June2012 59.40 02May2012 64.90 24Apr2012

59.70 48.10 49.00 45.35 51.00 50.55 57.40

DateofLow 01Oct2012 11Sep2012 09Aug2012 12Jul2012 05June2012 25May2012 24Apr2012

In addition, following are also Group Companies: 1 2 3 4 5 6 7 8 9 10 Abhisekh Holding Pvt. Ltd. Adventz Industries India Limited Adventz Infraworld India Ltd. Birla Construction Ltd. Eureka Traders Pvt. Ltd. Fullford Vinimay Pvt. Ltd. Future Fuels (International) India Pvt. Ltd. Globex Limited Greenland Trading Pvt. Ltd. Gulbarga Cement Limited

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11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

High Quality Steels Ltd. Indian Furniture Products Limited Indrakshi Trading Company Pvt. Ltd. Interglas India Pvt. Ltd. Lionel Edwards Limited Lionel India Limited Master Exchange & Finance Limited Mcfarlene & Co. Ltd. Paradeep Phosphates Limited Planon Group Ltd. Ricon Commerce Limited Sanghashree Investment & Trading Company Ltd Simon India Limited Style Spa Furniture Limited Syndak Teatech Ltd. The Pench Valley Coal Company Limited Zuari Commodity Trading Limited Zuari Financial Services Limited Zuari Indian Oiltanking Limited Zuari Insurance Brokers Limited

Our Subsidiaries and Joint Ventures Subsidiaries Zuari Seeds Limited CIN is U01122GA1995PLC001751 Name the Company of Address the Company and contact number its of Business activity Details of listings, if any The Companys Board of Directors

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Zuari Seeds Limited

Jai Kisaan Bhawan, Zuarinagar, Goa 403726

Agri Business related to seeds

N.A.

1. Mr. H. S. Bawa Chairman 2. Mr. Suresh Krishnan Director 3. 4. 5. Mr. Naveen Kapoor Director Mr. Binayak Datta - Director Mr. V. L. Nageshwar Rao Manager

Shareholding Pattern The shareholding pattern of Zuari Seeds Limited as on September 30,2012 is as follows Sr. No 1. Name of Shareholder Promoters Shares 14,174,162 % Holding 100%

Change in Management There has been no change in the management of Zuari Seeds Limited in the last 3 years. Financial Performance The summary audited financial information of Zuari Seeds Limited on standalone basis is as follows: (in Rs. Lacs) S. For the year ended No.

March31,2012
1 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure (P & L Debit Balance) Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted

March 31, 2011 1417.42

March 31, 2010 1417.42

1,417.42

2 3 4 5 6 7

(1,696.31) (278.89) 4,650.15 73.41

NIL (1769.73) (352.31) 3713.39 133.64

NIL (1903.35) (485.93) 3,061.42 (43.18)

0.52 0.52

0.94 0.94

(0.30) (0.30)

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8 9

NAV per Share No. of Equity Shares

(1.97) 14,174,162

(2.48) 14,174,162

(3.42) 14,174,162

The company does not have any subsidiaries, hence it does not have consolidated accounts. The company is not listed.

Zuari Fertilizers and Chemicals Limited Its CIN is U24120GA2009PLC006158 Name the Company of Address the Company and contact number Zuari Fertilisers and Chemicals Limited Jai Kisaan Bhawan, Zuarinagar, Goa 403726 Manufacture of Fertilisers N.A. its of Business activity Details of The Companys Board of Directors

listings, if any

1. S.K.Poddar 2. N.N.Sureshkrishnan 3. H.S.Bawa 4. NaveenKapoor

5. BinayakDatta

Shareholding Pattern The shareholding pattern of Zuari Fertilisers and Chemicals Limited as on September 30,2012 is as follows Sr. No 1. Name of Shareholder Promoters No. of Shares 50,000 % Holding 100%

Change in Management There has been no change in the management of Zuari Fertilisers and Chemicals Limited in the last 3 years. Financial Performance The summary audited financial information of Zuari Fertilisers and Chemicals Limited on standalone basis is as follows:

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(in Rs. Lacs) S. No. March 31, 2012 1 2 3 4 5 6 7 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure (P&L Debit balance) Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares For the year ended March 31, 2011 5.00 NIL (24.22) (19.22) NIL (23.43) March 31, 2010 5.00 NIL (0.78) 4.22 NIL (0.78)

5.00 NIL (140.32) (135.32) NIL (116.10) (232.20) (232.20) (270.64) 50,000

(46.87) (46.87) (38.44) 50,000

(1.58) (1.58) 8.44 50,000

The company does not have any subsidiaries, hence it does not have consolidated accounts. The company is not listed. Joint Ventures Zuari Rotem Speciality Fertilisers Limited Its CIN is U01409GA2007PLC005489
Name the Company of Address and contact number of its Business activity Details of listings, if any The Companys Board of Directors

the Company

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Zuari Rotem Speciality Fertilisers Limited

Jai Kisaan Bhawan, Zuarinagar, Goa 403726

Manufacturing, Trading & Marketing of Fertiliser Products N.A.

1. 2. 3. 4. 5.

NAVEEN KUMAR KAPOOR KIRTI MOHAN NAITHANI JOSEPH ZIDON N. Suresh krishnan RAJEEV SINHA ALTERNATE DIRECTOR FOR JOSEPH ZIDON

Shareholding Pattern
The shareholding pattern of Zuari Rotem Speciality Fertilisers Limited as on September 30,2012 is as follows Sr. No 1. Name of Shareholder Promoters No. of Shares 6,915,002 % Holding 100%

Change in Management
There has been no change in the management of Zuari Rotem Speciality Fertilisers Limited in the last 3 years.

Financial Performance
The summary audited financial information of Zuari Rotem Speciality Fertilisers Limited on standalone basis is as follows:

(in Rs. Lacs) S. No. March 31, 2012 1 2 3 4 5 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure Net Worth Sales For the year ended March 31, 2011 691.50 182.04 NIL 873.54 4599.14 March 31, 2010 691.50 25.85 NIL 717.35 2176.96

691.50 324.85 0 1016.35 5064.58

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6 7

Profit/(Loss) after tax Earnings per share - Basic - Diluted

143.80

156.19

64.62

2.08 2.08 14.71 6915002

2.26 2.26 12.63 6915002

1.08 1.08 10.37 6915002

8 9

NAV per Share No. of Equity Shares

The company does not have any subsidiaries, hence it does not have consolidated accounts. The company is not listed. Zuari Maroc Phosphates Limited Its CIN is U24124GA2002PLC003064 Name the Company of Address the Company and contact number Zuari Maroc Phosphates Limited Jai Kisaan Bhawan, Zuarinagar, Goa 403726 Manufacturing, Trading & Marketing of Fertiliser Products N.A . 1. NARAYANAN KRISHNAN 2. HARBACHAN SINGH BAWA 3. MARCO PHILIPPUS ARDESHIR WADIA 4. Mohamed Ibnabdeljalil 5. R.S. Raghavan 6. Anas LAHLOU 7. YOUSSEF EL BARI Shareholding Pattern The shareholding pattern of Zuari Maroc Phosphates Limited as on September 30,2012 is as follows Sr. No 1. Name of Shareholder Promoters No. of Shares 359,632,456 % Holding 100% SURESH its of Business activity Details of listings, if any The Companys Board of Directors

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Change in Management There has been no change in the management of Zuari Maroc Phosphates Limited in the last 3 years. Financial Performance The summary audited financial information of Zuari Maroc Phosphates Limited on standalone basis is as follows: (in Rs. Lacs) S. No. March 31, 2012 1 Equity Capital Reserves (excluding revaluation reserves) and surplus Misc. Expenditure (P & L debit balance) Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares For the year ended March 31, 2011 35,963.24 March 31, 2010 35,963.24

35,963.24

2 3 4 5 6 7

6,198.23

NIL (6078.84)

NIL (6094.66)

0.00 29,765.02 19.06 119.39

29,884.40 NIL 15.81 29,868.58 NIL 2.05

0.03 0.03 8.28 359,632,456.00

0.004 0.004 8.31 359,632,456

0.0006 0.0006 8.31 359,632,456

The summary audited financial information of Zuari Maroc Phosphates Limited on Consolidated basis is as follows: (in Rs. Lacs) S. No. March 31, 2012 1 2 Equity Capital Reserves (excluding revaluation reserves) For the year ended March 31, 2011 35,963.25 69,751.93 March 31, 2010 35,963.25 55,489.43

35,963.25 83,929.87

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and surplus 3 4 5 6 7 Misc. Expenditure Net Worth Sales Profit/(Loss) after tax Earnings per share - Basic - Diluted 8 9 NAV per Share No. of Equity Shares

0.00 119,893.12 479,274.26 14,177.94

NIL 105,715.18 128,680.75 17,724.12

NIL 91,452.68 120,085.05 15,156.98

3.94 3.94 33.34 359,632,456.00

3.97 3.97 29.40 359,632,456

3.60 3.60 25.43 359,632,456

The Company has Paradeep Phosphates Limited as a subsidiary. Zuari Maroc Phosphates Limited is not a Sick Industrial Company within the meaning of the SICA. The company is not listed.

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XI. INDUSTRY OVERVIEW Indian agriculture Fertilizer Production and Demand in India Agriculture accounts for one fifth of GDP, provides sustenance to two-thirds of our population. The Government of India has been consistently pursuing policies conducive to increased availability and consumption of fertilizers in the country. As a result, the annual consumption of nutrients (N, P & K), has increased from 0.7 lakh MT in 1951-52 to 281.22 lakh MT 2010-11. As of now, the country has achieved near 75% capacity in production of urea. Similarly, adequate indigenous capacity has been developed in respect of phosphatic fertilizers to meet domestic requirements. However the raw materials and intermediates for the same are largely imported. As for potash (K) since there are no viable sources/ reserves in the country, its entire requirements are met through imports. Nutrient-wise capacity and actual production of Fertilizers Year 2009-10 2010-11 2011-12 Capacity (000 tonnes) Nitrogen (N) 12,944 12,947 12,947 Phosphorus (P) 6,176 6,200 6215 Production (000 tonnes) Nitrogen (N) 11,924 12,178 12288 Phosphorus (P) 4,374 4,371 4364

All India Consumption of Nitrogen, Phosphorus, and Potassium (N-P-K ) Year / Nutrient 2008-09 2009-10 2010-11 2011-12 Nitrogen (N) 15,090 15,580 16,558 17311 Phosphorus (P) 6,506 7,274 8,049 7665 Potassium (K) 3,312 3,632 3,514 2664 Total 24,909 26,486 28,122 27640

Nutrient-wise capacity and Actual Production of Fertilizers Till 31.03.2011 Nutrient Urea DAP MAP MOP Diammonium Monoammonium Muriate phosphate phosphate of Potash 2011-12 27,248 9,389 281 2435 (Approx up to Feb, 2012)

NP/NPK Complex 9,538

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Salient Features of Fertilizer Policy and Statistics Number of Fertilser Plants There are about 141 fertilizer plants in operation in the Country. This is comprised of 29 Urea, 19 DAP and NP/NPK Complex, 82 Single Super Phosphate (SSP) Plants, 10 Ammonium Sulphate and 1 Calcium Ammonium Sulphate Plant Capacity and Production of Fertilisers Total capacity of N and P increased 12.94 and 6.20 million tonnes as on 1st November 2010 to 12.95 and 6.22 million tonnes, respectively as on 1st November, 2011. The production of N increased from 11.94 million tonnes during 2009-10 to 12.173 million tonnes during 2010-11. Import of Fertilsers Import of N, P and K was 4.57, 3.74 and 3.90 million tonnes, respectively in year 2011-12. Among the major fertilizers, the import of Urea was 6.61 million tonnes. The import of DAP, MAP, NP/NPKs and MOP was 7.41, 0.19, 0.98 and 6.36 Million tonnes, respectively, during the period. Sale Points Total number of Fertilizer sale points was 275,462 as on 31.03.2011, out of which the share of the Private channel was 77% and cooperative and of other institutional agencies is 23%. Consumption of Fertilisers The Consumption of total nutrients was 28.12 million tonnes in 2010-11 as against 26.49 million tonnes in the previous year. The consumption of N, P and K was 16.56, 8.05 and 3.51 million tonnes, respectively, during 2010-11. Subsidy on Fertilizers Actual subsidy paid on all Fertilisers was Rs. 65,837 Crores in 2010-11 Soil Testing and Fertiliser Quality Control Laboratories During 2010-11, the total number of soil testing laboratories was 1049, out of which 896 are static and 153 mobile. The total analyzing capacity was 10.70 million GDP and Agriculture GDP Total GDP grew to 6.9% during 2011-12 as against 8.4% in 2010-11. Share of agriculture and allied sectors to total GDP was 13.9% during 2010-11

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Development & Growth of Fertilizer Industry Objects and vision of Department Achieving fertilizer security for the country for sustainable agricultural growth supported by a robust domestic fertilizer industry. Ensuring adequate and timely availability of fertilizers to the farmers at affordable prices through planned production and imports and distribution of fertilizers in the country and planning for self-sufficiency in Urea production Strategy for Growth adopted by Government of India
z

Expansion and capacity addition/ efficiency enhancement through retrofitting / revamping of existing fertilizer plants. Setting up joint venture projects in countries having abundant and cheaper raw material resources. Working out the possibility of using alternative sources like liquefied natural gas, coal gasification, etc., to overcome the constraints in the domestic availability of cheap and clean feed and fuel. Modernization and Expansion of the existing Projects Feedstock, particularly for the production of urea. Looking at possibilities of revival of some of the closed units by setting up brownfield units subject to availability of gas. Farmer Education and Agri-Extension Services: The basic purpose of the application of fertilizer is to enhance the crop productivity in the country. The Fertilizer companies launch their fertilizer projects for educating the farmers about the quality/contents of the soil for crops. Introduction of Information Technology (IT): Fertilizer Management On-line has been developed in Department of Fertilizers in close collaboration with National Informatics Centre to meet the national objective of making fertilizers available timely, adequately in good quality and at affordable price to the farmers by maintaining growth of fertilizer industry through subsidies/concessions.

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XII. OUR BUSINESS Late Dr. K K Birla founded Zuari Industries Limited in 1967, now a well known business conglomerate in India. Late Dr. Birla came from a family which contributed to Freedom Movement in India and was a pioneer in core sectors of Indian economy. The Honble High Court of Bombay at Goa sanctioned the Scheme of Arrangement and Demerger between Zuari Industries Limited (ZIL) and Zuari Holdings Limited (ZHL). The Scheme envisaged transfer of fertiliser operations alongwith some strategic investments of ZIL to ZHL with the appointed date of 1st July, 2011. Thus, ZHL has become the largest fertilizer player in India, with associate companies. Sold close to 1.86 Million tons of fertilizers in 2011-12 (w.e.f. July, 2011) Installed capacity of 2.5 Million tons for Urea and Phosphate fertilizers The Company specializes in manufacturing of Major Nutrients (Urea, DAP, MOP & Complexes), Crop Protection (Insecticides, Fungicides and Herbicides), Seeds (Cotton, Maize, Paddy), Speciality fertilisers (SOP & WSF), Micro Nutrients (Zinc Sulphate, Sulpher, Boron) Markets the Jai Kisaan brand of Urea and Samrat brand of DAP A network of over 3,500 dealers and 5,000 sub-dealers nationwide (along with other group companies) Serves more than 16 million farmers nationwide (along with other group companies) Preferred brand over competitors for more than 3 decades Expanding market share in existing regions and strengthening in new regions Comprehensive programs have been devised to supplement distribution reach

Plants and Units of the Company and Subsidiaries: Zuari Agro Chemicals Ltd: Urea plant having Capacity of 1,140 metric tonnes per day and 700 MT of Ammonia Plant Located in Goa and commissioned in 1973. Paradeep Phosphates Ltd - Located in Paradeep, Orissa, acquired through Government of India disinvestment plan, DAP Plant having 720,000 metric tonnes annual capacity. Sulphuric Acid Plant (SAP) 660,000 metric tonnes annual capacity. Phosphoric Acid Plant (PAP) 225,000 metric tonnes annual capacity. Zuari Rotem Specialty Fertilisers: Located in Baramati, Maharashtra and commissioned in 2010 Manufacturing high grade water soluble fertilizers having formidable reach and brand strength in the regions it operates. Expansion Plans: Zuari Fertilizers and Chemicals Ltd, a subsidiary of the Company, is in process of setting up of DAP Manufacturing Project, Customized Fertilizers Project and SSP Fertilizers Project.

114

Sales and Marketing Network: Dealer Network Fertiliser Undertaking Paradeep Phosphates Limited Total Retail Network Fertiliser Undertaking Paradeep Phosphates Limited Total Farmers Catered Fertiliser Undertaking Paradeep Phosphates Limited Total Facilities: Services to Farming Community Jai Kisaan Sangam a unique program for Farmers conceived in 2005 More than 300 Krishi Sevaks are working with farmers at grass root level Jai Kisaan Varta: Quarterly magazine on agriculture is hand delivered to JKS members Soil Testing Services: Basic free service offered to JKS members whose results are made available online at www.jksangam.com

2,600 1,550 4,150

17,200 5,000 22,200

8.5 Mn 8.0 Mn 16.5 Mn

Soil Fertility Maps Soil indexing of and fertility maps prepared and displayed at community places in each of the villages in our primary marketing areas Zuari Agri Park Zuari Agri Park established at Lamboti in 2007, Maharashtra to demonstrate methodology of harvesting targetted yields through precision agriculture Zuari Agri Park comprises of 104 acres of land, well suited for cultivating various crops

Agricultural Development Laboratories 3 high-tech Agricultural Development Laboratories are in operation in Pune, Bangalore and Tirupati More than 1 mn farmers have been benefited so far

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XIII. FINANCIAL STATEMENTS

Following financial statements have been made available in this document: 1. 2. 3. 4. Auditors Report on Zuari Agro Chemicals Limited for the period ended September 30, 2012 Auditors Report on Zuari Agro Chemicals Limited for the Year ended March 31, 2012 Auditors Report on Zuari Agro Chemicals Limited for the Year Ended March 31, 2011 Auditors Report on Zuari Agro Chemicals Limited for the Year Ended March 31, 2010

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INDEPENDENT AUDITORS REPORT To the Board of Directors of Zuari Agro Chemicals Limited (formerly known as Zuari Holdings Limited) We have audited the accompanying interim financial statements of Zuari Agro Chemicals Limited (formerly known as Zuari Holdings Limited) (the Company) which comprise the interim Balance Sheet as at September 30, 2012 , and the interim Statement of Profit and Loss and interim Cash Flow Statement for the six -month period then ended, and a summary of significant accounting policies and other explanatory information.

Managements Responsibility for the Financial Statements Management is responsible for the preparation of these interim financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Company in accordance with the requirements of Accounting Standard (AS) 25 referred to in sub-section (3C) of section 211 of the Companies Act, 1956 (the Act). This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation and presentation of the interim financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these interim financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the interim financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the interim financial statements. The procedures selected depend on the auditors judgment, including the assessment of the risks of material misstatement of the interim financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Companys preparation and fair presentation of the interim financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the interim financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion and to the best of our information and according to the explanations given to us, the accompanying interim financial statements give a true and fair view in accordance with Accounting Standard (AS) 25 referred to in sub-section (3C) of section 211 of the Act: (a) in the case of the interim Balance Sheet, of the state of affairs of the Company as at September 30, 2012;

F-1

(b) in the case of the interim Statement of Profit and Loss, of the profit for the six-month period ended on that date; and (c) in the case of the interim Cash Flow Statement, of the cash flows for the six -month period ended on that date.

Other matters

The corresponding financial information for the period ended September 30, 2011 presented in the accompanying interim financial statements have not been audited. The accompanying interim financial statements have been prepared, and this report thereon issued, solely for the purpose of inclusion in the advertisement to be published by the Company in newspapers in connection with the proposed listing of equity shares of the Company on the Bombay Stock Exchange and National Stock Exchange. Accordingly, this report should not be used, referred to or distributed for any other purpose without our prior written consent. For S.R. Batliboi & Co. Chartered Accountants Firms Registration Number: 301003E Sd/per Anil Gupta Partner Membership Number: 87921 Place of Signature: Gurgaon Date:

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Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Balance Sheet as at 30th September 2012 Notes 30th September 2012 Rs. in Lacs 31st March 2012

I. EQUITY AND LIABILITIES

Shareholders funds
(a) (b) Share capital Reserves and surplus 3 4 4,205.80 76,949.35 81,155.15 1,223.41 5,093.83 6,317.24 199,859.79 88,608.73 21,526.96 3,148.13 313,143.61 400,616.00 4,205.80 74,253.16 78,458.96 1,494.42 4,781.15 6,275.57 296,501.77 74,610.48 5,647.66 5,221.69 381,981.60 466,716.13

Non-current liabilities
(a) (b) Deferred tax liabilities (Net) Other non-current liabilities 5 6

Current liabilities
(a) (b) (c) (d) Short-term borrowings Trade payables Other Current Liabilities Short-term provisions 8 6 6 7

Total II. ASSETS Non-current assets (a) Fixed assets i Tangible assets ii Intangible assets iii Capital work-in-progress (b) Non-current investments (c) Long-term loans and advances (d) Other non-current assets Current assets
(a) (b) (c) (d) (e) Inventories Trade receivables Cash and bank balances Short-term loans and advances Other current assets

9 9(a) 10 11 12

18,148.03 7.98 6,041.79 19,749.97 11,398.74 125.25 55,471.76 135,264.40 198,358.12 98.16 6,844.72 4,578.84 345,144.24 400,616.00 0.00 0.00

18,966.35 73.77 1,954.02 19,749.97 9,532.85 131.40 50,408.36 72,164.89 295,198.04 33,259.01 6,743.03 8,942.80 416,307.77 466,716.13

13 14 15 11 12

Total
Summary of significant accounting policies 2.1

The accompanying notes are an integral part of the financial statements. As per our report of even date For and on behalf of the Board of Directors of Zuari Agro Chemicals Limited

For S.R. Batliboi & Co. Chartered Accountants Firm's Registration No.301003E

S.K.PODDAR Chairman

SURESH KRISHNAN Managing Director

MARCO WADIA Director

per ANIL GUPTA Partner Membership No. 87921 Place: Gurgaon Date: November 6,2012

VSESHADRI VicePresident Finance

Place: Gurgaon Date: November 6,2012

R. Y. PATIL Chief General Manager & Company Secretary

F-3

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Statement of Profit and Loss for the period April 01, 2012 to September 30, 2012 Notes 30th September 2012 Rs. in Lacs 30th September 2011

I.

Income
(a) (b) (c) Revenue from operations (gross) Less: excise duty Revenue from operations (net) Other income 16 271,706.66 464.15 271,242.51 3,525.02 274,767.53 111,650.65 149,485.48 (43,020.86) 3,907.62 38,283.19 260,306.08 14,461.45 984.26 10,077.73 3,399.46 974.27 (271.00) 703.27 2,696.19 180,931.25 215.49 180,715.76 405.41 181,121.17 50,430.15 147,284.15 (42,139.71) 2,214.12 16,766.36 174,555.07 6,566.10 597.98 2,935.54 3,032.58 964.32 (3.99) 960.33 2,072.25

17

Total Revenue
II. Expenses (a) Cost of raw materials consumed (b) Purchase of traded goods (c) (Increase)/Decrease in inventories of finished goods, work-in-progress and traded goods (d) Employee benefits expense (e) Other expenses Total III. Earnings before interest, tax, depreciation and amortization (EBITDA) (I) - (II) (a) Depreciation and amortization expense (b) Finance costs IV. Profit before tax V. Tax expenses (a) Current income tax (b) Deferred tax Total tax expense Profit for the period (IV-V)
18 19 20 21 22

23 24

Basic (annualised) Earnings per equity share (nominal value of share Rs.10/(31st March 2012 - Rs.10/-) Diluted (annualised) Earnings per equity share (nominal value of share Rs.10/(31st March 2012 - Rs.10/-)

32 Rs. 12.82 Rs. 16.86

Rs. 12.82

Rs. 16.86

Summary of significant accounting policies 2.1 The accompanying notes are an integral part of the financial statements. As per our report of even date For and on behalf of the Board of Directors of Zuari Agro Chemicals Limited

For S.R. Batliboi & Co. Chartered Accountants Firm's Registration No.301003E

S.K.PODDAR Chairman

SURESH KRISHNAN Managing Director

MARCO WADIA Director

per ANIL GUPTA Partner Membership No. 87921 Place: Gurgaon Date: November

VSESHADRI VicePresident Finance

Place: Gurgaon Date: November

R.Y.PATIL Chief GeneralManager &CompanySecretary

6,2012

6,2012

F-4

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

CashFlowStatementfortheperiodApril01,2012toSeptember30,2012 Sl. Particulars No A. CASHFLOWFROMOPERATINGACTIVITIES: Profit/(loss)beforetax Adjustmentfor: Depreciation/amortisation Sundrybalanceswritenoff Loss/(Gain)onfixedassetssold/discarded(net) ExcessProvision/UnclaimedLiabilities/unclaimbalanceswrittenback Unrealizedforeignexchangefluctuationloss/(gain) Interestexpense Interestincome Dividendincome Operatingprofitbeforeworkingcapitalchanges Movementsinworkingcapital: Inventories Tradereceivables Otherassets Loansandadvances Otherliabilitiesandprovisions Cash(usedin)/fromOperations DirectTaxrefund/(Paid)(netofrefunds) Netcashflow(usedin)/fromoperatingactivitites(A) B. CASHFLOWFROMINVESTINGACTIVITIES: Purchaseoffixedassets Proceedsfromsaleoffixedassets Dividendreceived Interestreceived Redemption/ R d ti /maturity t it of fbank b kdeposits d it (having (h i original i i lmaturity t it of fmorethan th three th months) Proceedsfromsaleofinvestments Purchaseofinvestments Purchaseofinvestmentinsubsidiariesandjointventures** Loansgiventobodiescorporate Loansgiventobodiescorporatereceivedback Netcashflow(usedin)/frominvestingactivitites(B) C. CASHFLOWFROMFINANCINGACTIVITIES: ProceedsfromissuanceofShareCapital ProceedsfromBuyersCredit RepaymentofBuyersCredit Proceeds/(Repayment)ofshorttermborrowings Dividendpaid(includingdividendtax) Interestpaid Netcashflowfrom/(usedin)financingactivitites(C) NET(DECREASE)/INCREASEINCASHAND CASHEQUIVALENTS(A+B+C) CASHANDCASHEQUIVALENTS(OPENING) Less:TransferofdemergedfertilizerbusinesstoZuariHoldingLimited CASHANDCASHEQUIVALENTS(CLOSING) Periodended 30thSeptember2012 (Rs.inlacs) PeriodEnded 30thSept2011 (Rs.inlacs)

3,399.46 3,032.58 984.26 19.31 (726.01) (136.04) 3,687.32 (723.02) (854.14) 2,251.68 5,651.14 (63,099.51) 96,839.93 4,421.22 997.41 31,874.38 71,033.43 76,684.57 (1,809.56) 74,875.01 (4,050.82) 154.63 854.14 671.91 597.98 (10.87) 4.55 (29.12) 1,347.17 864.50 (205.56) (71.98) 2,496.67 5,529.25 (43,221.93) (44,328.17) 10,892.14 734.96 36,229.78 (39,693.22) (34,163.97) (0.00) (34,163.97) (946.00) 4.57 71.98 635.62 180.00 180 00

245,204.15 52,693.31 (248,916.91) (60,150.00) (19,749.97) (3,555.00) 4,425.00 (27,260.51) (5,212.90) 1,061.74 184,918.85 92,046.64 (282,245.90) (11,730.03) 685.07 (19,039.78) (1,460.17) (4,720.82) (621.80) 61,716.77 (102,822.97) (33,160.85) 33,259.01 292.30

17.33 1,479.91 98.16 1,789.54

F-5

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

CashFlowStatementfortheperiodApril01,2012toSeptember30,2012 CASHANDCASHEQUIVALENTS Asat 30thSeptember2012 (Rs.inLacs) PeriodEnded 30thSept2011 (Rs.inlacs)

Cashonhand Cheques/draftsonhand withbanksoncurrentaccount oncashcraditaccount unpaiddividendaccount* ondepositaccount(withorginalmaturitylessthenthreemonths) CashandCashEquivalents

1.15 15.85 90.76 6.25 15.97 570.21 1,187.50

98.16 1,789.54

Notes: 1 *Thesebalancesarenotavailableforuseastheyrepresentcorrespondingunpaiddividendliabilities. 2 Pursuant to the scheme of arrangement and demerger, all that assets and liabilities pertaining to fertilizer undertaking as on 1st July, 2011 have been transferred to Zuari Agro Chemicals Limited (Formerly Zuari Holdings Limited) at the book value, the said demerger is consideredascashneutralforthepurposeofcashflow. 3 **includespurchaseandsaleofinvestmentinsubsiderieshappenedthroughcashandcashequivalent 4 Previousyear`sfigureshavebeenregroupedwhervernecessarytoconfirmtocurrentyearclassification. Asperourreportofevendate ForandonbehalfofBoardofDirectorsofZuariAgroChemicals Limited

ForS.R.Batliboi&Co. CharteredAccountants Firm'sRegistrationNo.301003E

S.K.PODDAR Chairman

NSURESHKRISHNAN MARCO WADIA ManagingDirector Director

perANILGUPTA Partner MembershipNo.87921

V SESHADRI VicePresident Finance

R.Y. PATIL ChiefGeneral Manager& CompanySecretary

Place:GurgaonPlace:Gurgaon Date:November6,2012Date:November6,2012

F-6

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 1. CorporateInformation This Company is a public limited company domiciled in India and incorporated under the provisions oftheCompaniesAct1956.Itwasincorporatedon10thSeptember2009. The Company is a manufacturer of chemical fertilisers. The Company is also into trading business of complex and water soluble fertilisers and seeds. The Company caters to the demand of the farmers alloverthecountry,throughitsJaikisaanbrandofFertilisers. Pursuant to application for change of name of Company as per the approval of the shareholders at the Extraordinary General Meeting of the Company, held on 10th September 2012, the name of the Company has been changed from Zuari Holdings Limited to Zuari Agro Chemicals Limited vide fresh certificate of incorporation dated 28th September 2012 issued by the Registrar of Companies, Goa DamanandDiu. 2. Basisforpreparation The financial statements have been prepared to comply in all material respect the recognition and measurement principles of Accounting Standard (AS) 25, Interim Financial Reporting [notified pursuant to the Companies (Accounting Standards) Rules, 2006]. The Company has prepared this financial statement to comply in all material respects with the Notified Accounting Standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Companyandareconsistentwiththoseusedinpreviousyear. 2.1 SummaryofSignificantAccountingPolicies i) BasisofclassificationofCurrentandNonCurrent Assets and Liabilities in the balance sheet have been classified as either current or noncurrent based upontherequirementsofRevisedScheduleVInotifiedundertheCompaniesAct1956. An asset has been classified as current if (a) it is expected to be realized in, or is intended for sale or consumption in, the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is expected to be realized within twelve months after the reporting date; or (d) itiscashorcashequivalentunlessitisrestrictedfrombeingexchangedorusedtosettlealiabilityfor atleasttwelvemonthsafterthereportingdate.Allotherassetshavebeenclassifiedasnoncurrent. Aliabilityhasbeenclassifiedascurrentwhen(a)itisexpectedtobesettledintheCompanysnormal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is due to be settled within twelve months after the reporting date; or (d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. All other liabilitieshavebeenclassifiedasnoncurrent. Anoperatingcycleisthetimebetweentheacquisitionofassetsforprocessingandtheirrealizationin cashorcashequivalents.

F-7

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 ii) UseofEstimates The preparation of financial statements in conformity with generally accepted accounting principles (Indian GAAP) requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although theseestimatesarebaseduponmanagementsbestknowledgeofcurrenteventsandactions,actual resultscoulddifferfromtheseestimates. iii) FixedAssets Fixedassetsarestatedatcostlessaccumulateddepreciation/amortisationandimpairmentlosses,if any.Costcomprisesthepurchasepriceandanyattributablecostof bringingtheassettoitsworking conditionforitsintendeduse. Machinery spares which are specific to a particular item of fixed asset and whose use is expected to beirregulararecapitalizedasfixedassets. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including daytoday repair and maintenanceexpenditureandcostofreplacingparts,arechargedtothestatementofprofitandloss fortheperiodduringwhichsuchexpensesareincurred. iv) Depreciation Depreciation on tangible and intangible fixed assets is provided using the Straight Line Method as per the useful lives of the assets (other than machinery spares) as estimated by the management, which are equal to the rates prescribed under Schedule XIV of the Companies Act, 1956 except for computersandperipheralswhicharedepreciated/amortizedovertheusefullivesofthreeyears.For thispurpose,amajorportionoftheplanthasbeenconsideredascontinuousprocessplant. Machinery spares are depreciated prospectively over the estimated remaining useful lives of the respectivemotherassets. v) Intangibles Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in an amalgamation in the nature of purchase is their fair value as at the date of amalgamation. Following initial recognition, intangible assets are carried at cost less accumulatedamortizationandaccumulatedimpairmentlosses,ifany.Internallygeneratedintangible assets, excluding capitalized development costs, are not capitalized and expenditure is reflected in the statement of profit and loss in the year in which the expenditure is incurred. Intangibles representing computer software are amortized using the straight line method over their estimated usefullivesofthreeyears.

F-8

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 vi) Impairment The carrying amounts of Tangible and Intangible fixed assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverableamountisthegreateroftheassetsnetsellingpriceandvalueinuse. Inassessingvalue in use, the estimated future cash flows are discounted to their present value using a prediscount rate that reflects current market assessment of the time value of the money and rates specific to that asset. After impairment, depreciation is provided on the revised carrying amount of the asset overitsremainingusefullife. vii) Inventories InventoriesarevaluedatthelowerofCostandNetRealisableValue. TheCostisdeterminedasfollows:
(a) Stores and spares, Fuel oil, Raw Materials and Packing Materials : Moving weighted average method

(b) Workinprocess: Material cost on moving weighted average method and appropriate manufacturingoverheadsbasedonnormaloperatingcapacity

(c) (i) Finished goods (manufactured): Material cost on moving weighted average method and appropriatemanufacturingoverheadsbasedonnormaloperatingcapacityincludingExciseDuty (ii) Tradedgoods:Movingweightedaveragemethod Materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Net Realisable Value is the estimated selling price in the ordinary course of business, less the estimatedcostsofcompletionandtheestimatedcostsnecessarytomakethesale. viii) Investments Investments that are readily realisable and intended to be held for not more than a year from the dateofwhichsuchinvestmentsaremadeareclassifiedascurrentinvestments.Allotherinvestments are classified as longterm investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Longterm investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in thevalueoftheinvestments.

F-9

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 ix)RetirementandotherEmployeeBenefits a)ProvidentFundandFamilyPensionFund RetirementbenefitsintheformofProvidentFundisadefinedbenefitobligationandisprovidedfor onthebasis ofactuarialvaluationofprojectedunitcreditmethodmadeattheendofeach financial year.Thedifferencebetweentheactuarialvaluationoftheprovidentfundofemployeesattheyear end and the balance of own managed fund is provided for as liability in the books in terms of the provisions under Employee Provident Fund and Miscellaneous Provisions Act, 1952. Family Pension FundsisadefinedcontributionschemeandthecontributionsarechargedtotheStatementofProfit andLossoftheyearwhenthecontributiontothefundsisdue. b)Gratuity Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of each financial year. The Company has taken an insurance policy under the Group Gratuity Scheme with the Life Insurance Corporation of India (LIC) to cover the gratuity liability of the employees and amount paid/payable in respect of the present value of liability for past services as determined on actuarial valuation is charged to the StatementofProfit&Losseveryyear. c) LeaveEncashment Accumulated leave, which is expected to be utilized within the next 12 months, is treated as short termemployeebenefit.TheCompanymeasurestheexpectedcostofsuchabsencesastheadditional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reportingdate The Company treats accumulated leave expected to be carried forward beyond twelve months as long term employee benefit for measurement purpose. Such long term compensated absences are providedforbasedonactuarialvaluationusingtheprojectedunitcreditmethodattheyearend. The Company presents the entire leave as a current liability in the balance sheet, since it does not haveanunconditionalrighttodeferthesettlementfor12monthsafterthereportingdate. d) SuperannuationandContributoryPensionFund The Company has approved Superannuation Fund and Contributory Pension Fund which are defined contribution schemes and the contributions paid to Life Insurance Corporation of India (LIC) against the insurance policy taken with them are charged to the Statement of Profit & Loss each year. The CompanydoesnothaveanyotherobligationotherthancontributionspaidtoLIC. e) Actuarial gains/losses related to gratuity, long term compensated absences and provident fund in form of defined obligation plan are immediately taken to the Statement of Profit and Loss and are notdeferred.

F-10

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 x) Foreigncurrencytransactions a) Initialrecognition Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount theexchange rate between the reporting currency and the foreign currency atthe dateofthetransaction. b) Conversion Foreigncurrencymonetaryitemsarereportedusingtheclosingrate.Nonmonetaryitemswhichare carried in terms of historical cost denominated in a foreign currency are reported using the exchangerateatthedateofthetransaction;andnonmonetaryitemswhicharecarriedatfairvalue or other similar valuation denominated in a foreign currency, are reported using the exchange rates thatexistedwhenthevaluesweredetermined. c) ExchangeDifferences Exchangedifferencesarisingonthesettlementofmonetaryitemsoronreporting'smonetaryitems at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise. d) ForwardExchangeContractsnotintendedfortradingorspeculationpurposes The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as incomeorasexpensefortheyear. xi)RevenueRecognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Companyandtherevenuecanbereliablymeasured. Revenue from sale of goods, including concession in respect of Urea, DAP, MOP and Complex Fertilisers receivable from the Government of India under the New Pricing Scheme/Concession Scheme, is recognized when the significant risk and rewards of ownership of the goods have passed to the customers. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economic benefits flowing to the Company. Hence, they are excluded from revenue. Excise Duty deducted from turnover (gross) is the amount that is includedintheamountofturnover(gross)andnottheentireamountofliabilityassessedduring the year. Concessions in respect of Urea as notified under the New Pricing Scheme is recognized with adjustments for escalation/deescalation in the prices of inputs and other adjustments as estimated bythemanagementinaccordancewiththeknownpolicyparametersinthisregard.

F-11

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 Subsidy for Phosphatic and Potassic (P&K) fertilisers are recognized as per rates notified by the GovernmentofIndiainaccordancewithNutrientBasedSubsidyPolicyfromtimetotime. UniformfreightsubsidyonUrea,Complexfertilisers,ImportedDAPandMOPhasbeenaccountedfor inaccordancewiththeparametersandnotifiedrates. InterestIncomeisrecognisedonatimeproportionbasistakingintoaccounttheamountoutstanding andtherateapplicable. InsuranceclaimsareaccountedfortotheextenttheCompanyisreasonablycertainoftheirultimate collection. Dividendisrecognizedwhentheshareholdersrighttoreceivepaymentisestablishedbythebalance sheetdate. xii) Borrowingcosts Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized to the extent they relate to the period till such assets are capitalized to the extent theyrelatetotheperiodtillsuchassetsarereadytobeputtouse.Aqualifyingassetisanassetthat necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs arerecognisedasanexpenseintheyearinwhichtheyareincurred. xiii) OperatingLeases WheretheCompanyisthelessee Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expenseintheStatementofProfitandLossonastraightlinebasisovertheleaseterm. xiv) AccountingforTaxes Tax expense comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. Deferred income taxes reflect the impact of timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Company has carry forward of unabsorbed depreciation and tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realised against future taxable profits. Unrecognised deferred tax assets of earlier years are reassessed at each balance sheet date and recognisedto theextentthatithasbecomereasonably certainorvirtuallycertain,asthecasemay be, that sufficient future taxable income will be available against which such deferred tax assets canberealised.

F-12

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 Thecarryingamountofdeferredtaxassetsarereviewedateachbalancesheetdate.TheCompany writesdown the carrying amount of a deferred tax asset to the extent that it is no longer reasonablycertainorvirtuallycertain,asthecasemaybe,thatsufficientfuturetaxableincomewill be available against which deferred tax asset can be realised. Any such writedown is reversed to theextentthatitbecomesreasonablycertainorvirtuallycertain,asthecasemaybe,thatsufficient futuretaxableincomewillbeavailable. xv) Provisions A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of whichareliableestimatecanbemade.Provisionsarenotdiscountedtotheirpresentvalueandare determined based on best estimates required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and are adjusted to reflect the current best estimates. xvi) EarningsperShare Basic Earnings per Share (EPS) is calculated by dividing the net profit or loss for the year attributable to the equity shareholders (after deducting attributable taxes) by the weighted averagenumberofequitysharesoutstandingduringtheyear. Forthepurposeofcalculatingdilutedearningspershare,netprofitorlossfortheyearattributable toequityshareholdersandtheweightedaveragenumberofsharesoutstandingduringtheyearare adjustedfortheeffectsofalldilutivePotentialEquityShares. xvii) DerivativeInstruments In accordance with the ICAI announcement, derivative contracts , other than foreign currency forward contracts covered under AS 11, are marked to market on portfolio basis, and the net loss, if any, after considering the offsetting effect of gain on the underlying hedged item, is charged to the Statement of profit and loss. Net gain, if any, after considering the offsetting effect of loss on theunderlyinghedgeditem,isignored. xviii) CashandCashequivalents Cash and cash equivalents in the cash flow statement comprises cash at bank and in hand and shortterminvestmentswithanoriginalmaturityperiodsofthreemonthsorless. xix) Governmentgrantsandsubsidies Grantsandsubsidiesfromthegovernmentarerecognizedwhenthereisreasonableassurancethat thegrant/subsidywillbereceivedandallattachingconditionswillbecompliedwith. When the grant or subsidy relates to an expenses item, it is recognised as income over the periods necessarytomatchthemonasystematicbasistothecosts,whichitisintendedtocompensate. Where the grant or subsidy relates to an asset, its value is deducted from the gross value of the assetconcernedinarrivingatthecarryingamountoftherelatedasset.

F-13

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 xx) ContingentLiabilities A contingent liability is a possible obligation that arises from past events whose existence will be confirmedbytheoccurrenceornonoccurrenceofoneormoreuncertainfutureeventsbeyondthe control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arisesinextremelyrarecaseswherethereis aliabilitythatcannotberecognizedbecauseitcannot be measured reliably. The Company does not recognize a contingent liability but discloses its existenceinthefinancialstatements. xxi) MeasurementofEBIDTA As permitted by the guidance note on the Revised Schedule VI to the Companies Act, 1956, the Company has elected to present earnings before interest, tax, depreciation and amortization (EBIDTA) as a separate line item on the face of Statement of Profit and Loss. The Company measures EBIDTA on the basis of Profit/(Loss) from continuing operation, In its measurement, the Companydoesnotincludedepreciationandamortizationexpense,financecostsandtaxexpense. Thisspacehasbeenintentionallyleftblank

F-14

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 3. Share Capital 30th September 2012 Rs In Lacs 4,205.80 4,205.80 Issued 4,20,58,006 (31st March 2012:: 1,26,17,402) Equity Shares of R.10/- Each Fully paid Subscribed and Paid-up 4,20,58,006 (31st March 2012:: 1,26,17,402) Equity Shares of R.10/- Each Fully paid Total Equity Share suspense account* Total 4,205.80 31st March 2012 Rs In Lacs 4,205.80 4,205.80 1,261.74

Authorised : 4,20,58,006 (31st March 2012:: 4,20,58,006) Equity Shares or Rs.10/- Each

4,205.80 4,205.80 4,205.80

1,261.74 1,261.74 2,944.06 4,205.80

* Equity Share suspense for previous year represented 2,94,40,604 Equity Shares of Rs.10/- each to be issued to the shareholders of Zuari Industries Limited consequent to the Scheme of Arrangement and Demerger becoming Operational from effective date, pending allotment. a. Reconciliation of Shares Outstanding at the beginning and end of the reporting period Equity Shares 30th September 2012 in Numbers Rs in lacs 12,617,402 1,261.74 At the beginning of the period 29,440,604 2,944.06 Issued during the period Outstanding at the end of the period 42,058,006 4,205.80 Equity Share Suspense Account -

31st March 2012 in Numbers 2,000,000 10,617,402 12,617,402 29,440,604

Rs in lacs 200.00 1,061.74 1,261.74 2,944.06

b. Terms/Rights Attached to equity Shares The Company has only one class of equity shares having a par value of Rs.10/- Share. Each share holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees.

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 number of equity shares held by the shareholders.

c. Details of Shareholders holding more than 5% of equity shares in the Company As at 30th September 2012 No. of Shares held % Holding in Class 8,411,601 3,208,000 2,557,941 7,012,000 4,205,801 25,395,343 20.00 7.63 6.08 16.67 10.00 As at 31st March 2012 No. of Shares held % Holding in Class 8,411,601 4,205,801 12,617,402 66.67 33.33

Name of Shareholder Zuari Industries Limited SIL Investments Limited Texmaco Limited Globalware Trading and Holdings Limited Zuari Management Services Limited Total

As per records of the Company including its register of share holders/members and other declarations received from share holders regarding beneficial interest, the above share holding represents both legal and beneficial ownership of shares.

F-15

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 4. Reserves and Surplus 30th September 2012 Rs In Lacs Business Restructuring Reserve * Balance as per last financial statements Add: Amount transferred from surplus balance in the statement of profit and loss [arising on 1st July,2011, being the difference of assets over liabilities on the transfer/vesting of the "Fertiliser Undertaking" as per the Scheme of Arrangement and Demerger in terms of Order of Hon'ble High Court of Bombay. Closing Balance General Reserve Balance as per last financial statements Add: Amount transferred from surplus balance in the statement of profit and loss Closing Balance 65,404.84 31st March 2012 Rs In Lacs 65,404.84

65,404.84

65,404.84

5,000.00 5,000.00

5,000.00 5,000.00

Surplus in the statement of profit and loss Balance as per last financial statements Net profit for the year Less : Appropriations Proposed final equity dividends:: Nil (31st March 2012:: Rs.3 Per Equity Share) Tax on proposed equity dividend Transfer to general reserve Total appropriations Net surplus in the statement of profit and loss Total reserves and surplus * The said reserve be treated as free reserve and be restricted and not utilized for declaration of dividend by the Company. 5. Deferred tax liabilities (Net)

3,848.32 2696.19

(2.97) 10317.71

6,544.51 76,949.35

1,261.74 204.68 5,000.00 6,466.42 3,848.32 74,253.16

30th September 2012 Rs In Lacs Deferred tax liabilities Fixed assets Impact of difference between tax depreciation and depreciation/amortisation charged for the financial reporting Gross deferred tax liabilities Deferred tax assets Provision for doubtful debts Expenses allowable in Income tax on payment basis and deposition of Statutory dues Gross deferred tax assets Net deferred tax liabilities 2,773.91 2,773.92

31st March 2012 Rs In Lacs 2,875.10 2,875.10

15.35 1,535.16 1,550.51 1,223.41

15.35 1,365.33 1,380.68 1,494.42

F-16

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 6. Other Liabilities Non Current 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs Trade payables (Including acceptance) (refer note. 35 for details of dues to Micro and Small Enterprise) Other Liabilities Trade deposits - dealers Unclaimed stautory liabilties as referred in Section 205(c) of the Companies Act, 1956 to be credited as and when due Unclaimed dividends Interest accrued but not due on loans and deposits Forward cover payable Advances from dealers and others Payables towards capital goods Statutory and other obligations 5,093.83 4,781.15 88,608.73 74,610.48 Current 30th September 2012 Rs In Lacs 88,608.73 31st March 2012 Rs In Lacs 74,610.48

5,093.83 5,093.83

4,781.15 4,781.15

6.25 590.74 15,739.52 445.61 643.82 4,101.02 21,526.96 110,135.69

1,624.24 390.87 261.39 3,371.16 5,647.66 80,258.14

Total

7. Provisions Long-term 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs Provision for employee benefits Gratuity (funded)[Refer note no.34(A)] Providend fund [Refer note 34(B)] Leave encashment (unfunded) Others provisions Provision for current tax (net of advance tax) Provision for wealth tax Provision for proposed equity dividend Provision for tax on proposed equity dividend Total 8. Short term borrowings 30th September 2012 Rs In Lacs 23,185.07 31st March 2012 Rs In Lacs Short-term 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs 180.82 2,955.31 3,136.13 12.00 12.00 3,148.13 81.92 54.38 2,784.54 2,920.84 784.43 50.00 1,261.74 204.68 2,300.85 5,221.69

From Banks Secured a. Cash credit (The rate of interest on Cash Credit varies according to the Banks between 11.75% - 14.50% and are repayable on demand) b. Buyers credit (The rate of Interest on buyers credit varies between 1.00% - 4.00%) and are repayable over a period of 150 - 360 days c. Term loan 10.25% Working Capital Demand Loan from State Bank of India (Repayable in 6 months from the date of first drawn, viz., 7th September 2012) Unsecured a. Term loan 11.50% loan from Indian Overseas Bank (Repayable in three equal monthly instalments commencing at the end of 7th, 8th and 9th Month from the date of first availment, viz., 14th January 2012) Total

166,674.72

264,001.77

10,000.00

199,859.79

264,001.77

32,500.00

199,859.79

32,500.00 296,501.77

(a) The cash credit,buyers credit and term loan are secured by the first charge by way of hypothecation on the current assets, both present and future, wherever situated pertaining to the Company and the Company's present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets. (b) Unsecured term loan have been fully paid during the current period.

F-17

Zuari Agro Chemicals Limited Notes to financial statements for the period ended 30th September 2012 9. Tangible assets (Rs. in lacs)
Particulars Cost As at 01.04.2011 Additions Disposals Addition: Due to De-Mearger Scheme As at 31.03.2012 As at 01.04.2012 Additions Disposals As at 30.09.2012 Depreciation As at 01.04.2011 Charge for the year Disposals Addition: Due to De-Mearger Scheme As at 31.03.2012 As at 01.04.2012 Charge for the year Deductions As at 30.09.2012 Net block As at 30.09.2012 As at 31.03.2012 9(a). Intangible assets Particulars Gross block As at 01.04.2011 Additions Disposals Addition: Due to De-Mearger Scheme As at 31.03.2012 As at 01.04.2012 Purchase Deductions As at 30.09.2012 Amortization As at 01.04.2011 Charge for the year Disposals Addition: Due to De-Mearger Scheme As at 31.03.2012 As at 01.04.2012 Charge for the year Deductions As at 30.09.2012 Net block As at 30.09.2012 As at 31.03.2012 Software 785.91 785.91 785.91 785.91 139.12 573.02 712.14 712.14 65.79 777.93 7.98 73.77 (Rs. in lacs) Total 785.91 785.91 785.91 785.91 139.12 573.02 712.14 712.14 65.79 777.93 7.98 73.77 Freehold Buildings Land 141.48 93.52 235.00 235.00 141.48 93.52 313.21 3.78 2,070.51 2,379.94 2,379.94 3.84 0.07 2,383.71 Railway Siding 1,500.59 1,500.59 1,500.59 1,500.59 Plant & machinery 451.97 445.12 41,149.33 41,156.18 41,156.18 150.42 11.73 41,294.87 Furniture & Office fixtures equipment 63.48 3.48 516.04 576.04 576.04 20.34 0.64 595.74 55.99 7.26 1,355.07 1,403.80 1,403.80 26.71 2.41 1,428.10 Vehicles Total

100.86 41.16 641.78 701.48 701.48 72.78 45.67 728.59

1,126.99 500.80 47,326.84 47,953.03 47,953.03 274.09 202.00 48,025.12

93.52 235.00

41.03 1.86 1,081.38 1,120.55 1,120.55 31.86 0.03 1,152.38 1,231.33 1,259.39

53.80 919.86 973.66 973.66 35.87 1,009.53 491.06 526.93

1,381.70 341.00 24,387.48 25,428.18 25,428.18 749.97 7.56 26,170.59 15,124.28 15,728.00

47.62 2.24 283.43 328.81 328.81 13.23 0.62 341.42 254.32 247.23

89.38 2.42 880.37 967.33 967.33 52.18 1.60 1,017.91 410.19 436.47

49.01 24.25 143.39 168.15 168.15 35.36 18.25 185.26 543.33 533.33

1,662.54 371.77 27,695.91 28,986.68 28,986.68 918.47 28.06 29,877.09 18,148.03 18,966.35

F-18

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 10. Investments 30th September 2012 Rs In Lacs (A) Non-Current Investments Trade Investments (valued at cost, unless otherwise stated) Unquoted Investment in subsidiaries 1,41,74,162 (31st March 2012:: 1,41,74,162 ) Equity Shares of Rs.10/- each fully Paid up of Zuari Seeds Limited 50,000 (31st March 2012:: 50,000) Equity Shares of Rs.10/- each fully paid up of Zuari Fertiisers and Chemicals Limited Investment in Joint Ventures 17,98,16,178(31st March 2012:: 179,816,178) Equity shares of Rs.10/- each fully Paid up of Zuari Maroc Phosphates Limited 34,57,501 (31st March 2012:: 34,57,501) Equity shares of Rs.10/- each fully Paid up of Zuari Rotem Speciality Fertilisers Limited Total Aggregate Amount of unquoted Investments Total 31st March 2012 Rs In Lacs

1,417.60 5.00

1,417.60 5.00

17,981.62 345.75 19,749.97 19,749.97 19,749.97

17,981.62 345.75 19,749.97 19,749.97 19,749.97

(a) The Company has invested a sum of Rs. 1,417.60 lacs in the equity shares Zuari Seeds Limited. Further, the Company has receivables of Rs.2376.59 lacs (previous year Rs.1711.79 lacs) by way of loans and trade advances.The Company has promised to provide continuous financial support. As per the latest audited financial statements of this subsidiary, accumulated losses of this subsidiary has resulted in erosion of its entire net worth. However, the said subsidiary Company has not incurred cash loss during the year ended 31st March 2012 and immediately preceeding financial year. The above Investment being in the nature of long term strategic investment and also in view of the projected profitable operations of the above company, management is of the view that the provision for diminution in the value of this investments is not required to be made there against.

(b) The Company has invested in the equity shares of Zuari Rotem Speciality Fertilisers Limited. The lock-in period of the equity share is five years. The Company cannot sell, transfer or in any other way dispose off its shares or interest during the lock-in period with out the prior written consent of the joint venturer. After the lock-in period the Company may transfer its shares only after the other joint venturer has been granted the right of first refusal.

11. Loans and Advances Non Current 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs 1,227.56 1,156.20 1,156.20 1,227.56 67.04 67.04 9,722.66 9,722.66 72.06 72.06 7,904.89 7,904.89 Current 30th September 2012 Rs In Lacs 423.10 423.10 4,285.00 4,285.00 1,656.41 1,656.41 31st March 2012 Rs In Lacs 365.24 365.24 4,195.49 4,195.49 1,847.61 1,847.61

Capital advances Unsecured, considered good Security deposits Unsecured, considered good Loans and advances to related parties (Refer note no.31) Unsecured, considered good Advances recoverable in Cash or Kind Unsecured, considered good Other Loans and Advances Secured, considered good Loans to employees (secured) Unsecured, considered good Loans to employees Prepaid expenses Advance income tax (net of provision for income tax) VAT credit receivable Balances with customs, port trust and excise authorities Total

120.82

142.19

40.18

46.23

260.66 381.48 11,398.74

257.51 399.70 9,532.85

66.34 241.00 50.86 81.43 0.40 480.21 6,844.72

67.03 148.01 72.82 0.60 334.69 6,743.03

F-19

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 12. Other Assets Non Current 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs 124.40 130.55 124.40 130.55 0.85 0.85 125.25 0.85 0.85 131.40 Current 30th September 2012 Rs In Lacs 119.47 61.81 190.50 21.19 426.25 3,759.62 4,578.84 4,578.84 31st March 2012 Rs In Lacs 31.40 136.61 147.92 19.78 3,355.75 1,327.77 3,923.57 8,942.80 8,942.80

Interest accrued on loans, advances and deposits Interest receivable from subsidiaries on loans Interest receivable from customers Interest accrued on loans to employees Claim receivable Forward cover receivable Unamortised Premium on forward contracts*

Non current bank balances (Refer note no.15) Total

* The Unamortised Foreign Exchange Premium on Outstanding Forward Exchange Contracts is being carried forward to be charged to the statement of Profit and Loss of subsequent period 13. Inventories (valued at lower of cost and net realisable value) 30th September 2012 Rs In Lacs Raw materials [includes material in transit Rs. 6796.07 lacs and includes material lying with others Rs. 2895.43 Lacs) [(31st March 2012 :: includes in transit Rs.4167.81 lacs and lying with others Rs.83.86 lacs) Packing materials [includes material lying with others Rs.64.49 lacs (31st March 2012:: Rs.49.42 lacs ] Work-in-progress Finished goods (includes material laying with others Rs. 381.98 lacs (31st March 2012 :: Rs.222.81 lacs Traded goods [includes material in transit Rs.405.12 lacs) and incluldes material lying with others Rs. 392.09 lacs (31st March 2012 :: includes material in transit Rs.Nil and includes material Lying with Others Rs.491.19 lacs)] Fuel Oil Stores and spares Total 44,751.65 756.05 1,399.55 8,521.75 67,659.29 6,977.16 5,198.95 135,264.40 31st March 2012 Rs In Lacs 27,308.59 479.48 1,355.70 10,853.06 22,350.99 4,937.87 4,879.20 72,164.89

F-20

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements as at September 30, 2012 14. Trade receivables Current 30th September 2012 Rs In Lacs Trade receivables outstanding for a period exceeding six months from the date they are due for payment Secured, considered good Unsecured, considered good (including subsidy receivable Rs. 17,090.23 lacs (31st March 2012:: including subsidy receivable Rs.10,551.53 lacs) Unsecured, considered doubtful Less: Provision for doubtful debts (A) Other receivables Secured, considered good Unsecured, considered good (including subsidy receivable Rs. 1,06,067.26 lacs (31st March 2012:: including subsidy receivable Rs.2,01,488.91 lacs (B) Total 15. Cash and bank balances Non Current 30th September 31st March 2012 2012 Rs In Lacs Rs In Lacs Cash and cash equivalents a. Balances with banks - On Current accounts - On Cash credit accounts - On Unpaid dividend accounts b. Cash on hand Current 30th September 2012 Rs In Lacs 31st March 2012 Rs In Lacs 4,388.75 176,862.77 181,251.52 198,358.12 4,209.82 280,431.18 284,641.00 295,198.04 31st March 2012 Rs In Lacs

12.44 17,094.16 47.31 17,153.91 47.31 17,106.60

1.02 10,556.02 47.31 10,604.35 47.31 10,557.04

90.76 6.25 1.15 98.16

23,229.42 10,028.53 1.06 33,259.01

Other bank balances Deposits with original maturity for more than 12 months (pledged with sales tax authorities Rs.0.85 lac 31st March 2012 :: Rs.0.85 lacs) Total Amount disclosed under non current assets

0.85

0.85

0.85 (0.85) -

0.85 (0.85) -

98.16

33,259.01

F-21

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements for the period April 01, 2012 to September 30, 2012 16. Revenue from operations 30th September 2012 Rs In Lacs Revenue from operations Sale of products Finished products Traded products Other operating revenues Scrap sales Revenue from operations (gross) Less: Excise duty Revenue from operations (net) Details of products sold 30th September 2012 Rs In Lacs Finished Products sold: Urea Complex fertilisers of the grades: 18:46:0 10:26:26 12:32:16 19:19:19 CO2 SSP 81,459.82 21,387.23 39,576.00 2,863.62 4,850.33 172.13 1,522.09 151,831.22 30th September 2011 Rs In Lacs 31,681.65 17,777.37 328.94 22,606.62 53.60 752.37 73,200.55 30th September 2011 Rs In Lacs

151,831.22 119,839.47 35.97 271,706.66 464.15 271,242.51

73,200.55 107,709.91 20.79 180,931.25 215.49 180,715.76

Traded Products sold: MOP DAP SSP SOP Complex Fertilisers Seeds Speciality Fertilisers

30,626.03 54,901.07 361.55 294.24 29,919.53 212.39 3,524.66 119,839.47

2,785.36 73,912.30 363.39 59.52 27,196.81 612.06 2,780.47 107,709.91

a. Sales of Finished Product and Traded Product include government subsidies. Subsidies include Rs.2438.08 lacs (30th September 2011 :: Rs. 814.37 lacs) in respect of earlier years, notified during the year. b. Stage III of the New Pricing Scheme (NPS) for Urea was in operation from 1st October, 2006 to 31st March , 2010. As per this scheme, all naphtha based units (including the company) were required to take steps for conversion to natural gas / liquified natural gas by 31st March 2010. The Company has intiated necessary steps for conversion. Government of India vide notification dated 17th March , 2010 has extended till further orders the provisions of Stage III of NPS. c. Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard. d. Excise duty on sales amounting to Rs. 464.15 lacs (30th September 2011 : Rs. 215.49 lacs) has been reduced from sales in statement of profit & loss and excise duty on increase / decrease in stock amounting to Rs.32.35 lacs (30th September 2011 : Rs. (11.88) lacs) has been considered as other expense in financial statements. 17. Other income 30th September 2012 Rs In Lacs Interest Income on Bank deposits Intercorporate loans Government of India Fertiliser Bonds Overdue trade receivables, employee loans etc Dividend Income on Current investments Rent received Service Income Excess provision/unclaimed liabilities/unclaimed balances written back Other non-operating income Total 43.09 191.52 488.42 854.14 3.77 1,041.01 726.01 177.06 3,525.02 30th September 2011 Rs In Lacs 17.28 110.71 77.57 71.98 2.67 29.12 96.08 405.41

F-22

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements for the period April 01, 2012 to September 30, 2012 18. Cost of raw materials consumed: 30th September 2012 Rs In Lacs 27,308.59 129,093.71 44,751.65 111,650.65 30th September 2011 Rs In Lacs 28,999.68 49,359.10 3,107.42 31,036.05 50,430.15

Opening Stocks Add : Inventory transferred on Demerger from Zuari Industries Limited Add : Purchases Add: Transfer of Stock for captive consumption Less: Inventory at the end of the year Cost of raw materials consumed

Details of raw materials consumed 30th September 2012 Rs In Lacs 57,518.88 29,958.88 13,430.24 8,704.93 596.82 919.79 521.11 111,650.65 30th September 2011 Rs In Lacs 19,084.09 21,201.29 3,974.52 5,454.25 313.94 402.06 50,430.15

Naphtha Phosphoric acid Muriate of potash Ammonia Purchased urea Rock phosphate Other raw materials Total

Details of inventory: Raw materials 30th September 2012 Rs In Lacs 17,809.39 15,599.48 8,566.36 2,104.40 123.89 349.60 198.53 44,751.65 30th September 2011 Rs In Lacs 10,860.53 14,846.25 4,334.85 303.94 466.65 223.84 31,036.06

Naphtha Phosphoric acid Muriate of potash Ammonia Purchased urea Rock phosphate Other raw materials Total 19. Details of purchase of traded products:

30th September 2012 Rs In Lacs Traded products purchase details Traded fertilisers: DAP MOP SSP SOP Complex Fertilisers Speciality Fertilisers and Seeds Total

30th September 2011 Rs In Lacs

97,797.61 30,466.49 336.62 15,759.70 5,125.06 149,485.48

69,808.70 29,187.28 360.06 224.21 45,767.03 1,936.87 147,284.15

F-23

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements for the period April 01, 2012 to September 30, 2012 20. (Increase) / Decrease in inventories 30th September 2012 Rs In Lacs Inventories at the end of the year Finished goods Traded goods Work-in-progress Opening Stocks( 30th September 2011: Inventory transferred on Demerger from Zuari Industries Limited) Finished goods Traded goods Work-in-progress Less : Captive consumption Total Details of Inventory 10,853.05 22,350.98 1,355.70 34,559.73 (43,020.86) 30th September 2012 Rs In Lacs 44,892.05 9,756.94 0.24 6,434.87 5,521.75 1,053.44 67,659.29 6,288.16 43,823.64 2,104.03 (3,107.42) 49,108.41 (42,139.71) 30th September 2011 Rs In Lacs 54,087.46 10,953.24 2.13 147.36 21,047.13 2,633.24 307.65 89,178.21 8,521.75 67,659.29 1,399.55 77,580.59 30th September 2011 Rs In Lacs 703.32 89,178.21 1,366.59 91,248.12

Traded Goods DAP MOP SSP SOP Complex Fertilisers Speciality Fertilisers Seeds

Finished Goods Urea 18:46:00 10:26:26 12:32:16 19:19:19 Others Work in Progress Ammonia Sweet Naphtha

2,265.74 1,336.76 3,011.29 1,501.34 3.01 403.61 8,521.75 37.01 1,362.54 1,399.55

80.23 240.30 130.23 58.48 194.08 703.32 363.29 1,003.30 1,366.58

21. Employee benefit expense 30th September 2012 Rs In Lacs 2,722.18 475.57 0.22 709.65 3,907.62 30th September 2011 Rs In Lacs 1,597.34 192.70 103.82 320.26 2,214.12

Salaries, wages and bonus Contribution to provident and other funds Gratuity (Refer note no: 34) Staff welfare expenses Total 22. Other expenses

Consumption of packing materials Stores and spares consumed Power, fuel and water Bagging and other contracting charges Outward freight and handling Rent Lease rentals Rates and taxes Insurance Repairs and maintenance Buildings Plant & machinery Others Payment to statutory auditors (Refer details below) Cash rebate Excise duty on Increase/(Decrease) on inventory Subsidy claims written off Sundry balances written off Loss on fixed assets sold/discarded (net) Mark to market loss on forward cover contract Miscellaneous expenses Total

30th September 2012 Rs In Lacs 1,356.49 578.81 17,917.05 1,491.52 11,097.87 941.46 66.79 84.34 267.21 94.18 1,485.37 209.43 32.02 244.13 32.35 4.91 19.31 388.50 1,971.45 38,283.19

30th September 2011 Rs In Lacs 666.51 175.23 5,891.37 825.80 6,894.21 87.09 25.90 14.62 62.52 8.01 897.62 153.56 11.61 70.61 (11.88) 0.41 10.87 4.55 977.75 16,766.36

F-24

Zuari Agro Chemicals Limited (Formerly known as Zuari Holdings Limited)

Notes to financial statements for the period April 01, 2012 to September 30, 2012 Payments to statutory auditors as As statutory auditors Audit fees Tax audit fee In other capacity Certification fees, etc. Reimbursement of expenses Total 30th September 2012 Rs In Lacs 12.64 2.25 15.39 1.74 32.02 30th September 2011 Rs In Lacs 5.94 1.03 3.84 0.80 11.61

23. Depreciation and amortisation expense 30th September 2012 Rs In Lacs 918.47 65.79 984.26 30th September 2011 Rs In Lacs 478.97 119.01 597.98

Depreciation of tangible assets Amortization of intangible assets Total 24. Finance costs

Interest expense Premium on foreign exchange forward cover Bank charges Total

30th September 2012 Rs In Lacs 3,687.32 6,123.55 266.86 10,077.73

30th September 2011 Rs In Lacs 864.50 1,400.30 670.74 2,935.54

F-25

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 25.Contingentliabilitiesnotprovidedfor: (RsinLacs) PeriodEnded YearEnded Particulars 30.09.2012 31.03.2012 A.DemandNoticesreceivedfromSalestaxauthorities i) Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 200506 to 2008 09. The Company had filed appeal before Joint Commissioner of 42.56 Commercial Taxes (Appeals), Bangalore, against the same. Based on the revised demand notice penalty proceedings for the period wasdisposedoffwiththepenaltyofRs.32.22lacs,whichhasbeen paidandchargedoffbytheCompany ii) Demand notice from Commercial Tax Department, towards non submission of "F Form for the year 200708. The Company has filed for stay in High Court of Andhra Pradesh. Based on the 15.96 revised proceedings, a revised demand notice for Rs. 0.33 lac was issued.ThesamewaspaidandchargedoffbytheCompany. B.ClaimagainsttheCompanynotacknowledgedasdebt.* 151.17 * Based on discussions with the solicitors/ favourable decisions in similar cases/ legal opinions taken bytheCompany,themanagementbelievesthattheCompanyhasagoodchanceofsuccessinabove mentionedcasesandhence,noprovisionthereagainstisconsiderednecessary. 26. Estimatedamountofcontractsremainingtobeexecutednotprovidedfor (RsinLacs) PeriodEnded YearEnded Particulars 30.09.2012 31.03.2012 Estimated amount of contracts remaining to be executed on capitalaccountnotprovidedfor 3,401.29 5,264.04 27. Aggregate amount of guarantees issued by the Banks to various government authorities and others are secured by a charge created by way of hypothecation on the current assets, both present and future, wherever situated pertaining to the Company and the Company's present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements,rightsandassetsRs.10,117.77lacs(PreviousyearRs.12,477.71lacs) 28. a) NetForeignexchangevariationchargedtoStatementofprofitandloss Period Ended Period Ended Particulars 30.09.2012 30.09.2011 Rs.InLacs Rs.InLacs Net Foreign exchange variation (including premium on 7,453.22 4,637.04 ForwardContracts)

F-26

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 b) ParticularsofForeignCurrencyExposures: i)ForwardContractsoutstandingasattheBalanceSheetDate: Detailsofderivatives 30.09.2012 31.03.2012 Buy(AmountinUSD) 406,127,857

Buy(AmountinUSD)

51,000,000

Purpose To hedge the purchases of raw materials and 577,013,319 traded goods and buyer credit Hedge of highly probable foreign currency purchases

ii)UnhedgedforeigncurrencyexposuresasattheBalanceSheetdate: Particulars AccruedInterest TradePayables ClaimsReceivable/ (Payable) 29. InformationinrespectofJointVentures: Sr No 1 2 3 4 5 6 7 8 9 10 11 The above details represent proportionate amount (unaudited) of the Companys share in the Joint Ventures. Particulars Proportionofownership interest Countryofincorporation Accountingperiodended Assets Liabilities Revenue Depreciation&Amotisation Otherexpenses Profitbeforetax ContingentLiabilities CapitalCommitments 30.09.2012 Unaudited 219,885.86 146,842.85 111,724.33 648.24 108,175.39 2,900.69 6,055.87 28,162.24 ZuariMarocPhosphates Limited(Consolidated) 50%(w.e.f.27/06/2011) India 31.03.12 169,880.66 99,786.38 204,356.38 935.96 191,224.51 12,195.91 6,020.38 2,625.585 (Rs.inlacs) ZuariRotemSpeciality FertilizerLimited 50%(w.e.f.31/05/2011) India 30.09.2012 31.03.12 Unaudited 2,174.91 1,404.40 1,569.44 1,389.29 19.77 1,225.85 143.67 0.61 895.75 2,250.96 32.12 2,115.46 103.38 0.61 USD INR(Rs.inlacs) USD INR(Rs.inlacs) USD INR(Rs.inlacs) ExchangeRate 30.09.2012 273,397.00 144.07 9,947,749.00 5,242.17 1,293,904.00 681.85 1USD=52.6970INR 31.03.2012 1,504,680.00 769.74 9,246,877 4,730.38 1,867,016 955.10 1USD=51.1565INR

F-27

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 30. SegmentalInformation PrimarySegment The Company is engaged in the manufacture, sale and trading of fertilisers and seeds which, in the context of Accounting Standard 17 (Segmental Information) notified by Companies (Accounting Standard) Rules, 2006 (as amended), is considered as the only business segment. Accordingly, no separatesegmentalinformationhasbeenprovidedherein. SecondarySegmentGeographicalSegment. TheCompanyoperatesinIndiaandthereforecaterstotheneedsofthedomesticmarket.Therefore, therearenoreportablegeographicalsegments. 31. RelatedPartydisclosuresunderAccountingStandard18 Thelistofrelatedpartiesasidentifiedbythemanagementisasunder:

A. Relatedpartieswherecontrolexists:

I.

HoldingCompany: ZuariGlobalLimited(upto30thJune,2011) SubsidiariesoftheCompany: (1) ZuariSeedsLimited(w.e.f.31stMay2011) (2) ZuariFertilisers&ChemicalsLimitedLimited(w.e.f.31stMay2011)

II.

B. Relatedpartieswithwhomtransactionshavetakenplaceduringtheyear:

I.

EnterprisesinrespectofwhichCompanyisanassociate:

(1)ZuariGlobalLimited(formerlyZuariIndustriesLimited) (2)IndianFurnitureProductsLimited (3) SimonIndiaLimited (4) ZuariManagementServicesLimited (5) AdventzInfraworldIndiaLimited (6) GulbargaCementLimited (7) GlobexLimited (8) ZuariInvestmentsLimited (9) ZuariInsuranceBrokersLimitedSubsidiaryofZuariInvestmentsLimited (10) ZuariCommodityTradingLimitedSubsidiaryofZuariInvestmentsLimited (11) ZuariFinancialServicesLimitedSubsidiaryofZuariInvestmentsLimited II. JointVenturesoftheCompany: (1) ZuariMarocPhosphatesLimited(Limited(w.e.f.27thJune2011) (2) ParadeepPhosphatesLtdSubsidiaryofZuariMarocPhosphatesLimited (3) ZuariRotemSpecialityFertilisersLimited(w.e.f.31stMay2011) IV. KeyManagementPersonnel (1) Mr.N.SureshKrishnanManagingDirector(w.e.f.April1,2012) (2) Mr.AkshayPoddarExecutiveDirector(w.e.f.April1,2012)

F-28

Related Party Transaction As Per Accounting Standard 18 For Zuari Agro Chemicals Limited Following transactions were carried out with related parties in the ordinary course of business for the Period ended 30th September'2012 (Rs. In Lacs) Period ended September 30, 2012
Sl. No Transaction details Subsidiaries Joint Ventures Holding Company Enterprises having Significant Influence Key Management Personnel

Period ended September 30, 2011

Joint Ventures Holding Company Enterprises having Significant Influence Fellow Subsidiaries Key Management Personnel

Subsidiaries

Payment made on their behalf - Zuari Seeds Limited - Zuari Management Services Limited - Zuari Maroc Phosphates Limited - Paradeep Phospahtes Limited - Adventz Infraworld India Limited - Zuari Rotem Speciality Fertilisers Limited - Zuari Global Ltd - Zuari Fertilisers & Chemicals Ltd - Zuari Indian Oiltanking Limited - Simon India Limited 0.01 2.89 1.51 0.07 23.60 1.91 72.41 401.57 0.60 0.23 10.61 1.92 10.44 29.94 1.91 3.62 -

Payment made on our behalf - Paradeep Phosphates Limited - Zuari Seeds Limited - Zuari Fertilisers & Chemicals Ltd - Zuari Global Limited - Simon India Limited - Adventz Infraworld India Limited - Zuari Management Services Limited - Style Spa Furniture Limited 3.42 3.55 3.86 0.43 0.02 0.20 0.24 0.15 39.02 -

Purchase of Investments - Zuari Global Limited 19,745.36 -

Service charges paid - Zuari Indian Oiltanking Limited - Zuari Investment Limited - Zuari Management Services Limited - Zuari Global Limited 77.39 58.47 30.17 33.70 0.20 -

F-29

Related Party Transaction As Per Accounting Standard 18 For Zuari Agro Chemicals Limited Following transactions were carried out with related parties in the ordinary course of business for the Period ended 30th September'2012 (Rs. In Lacs) Period ended September 30, 2012
Sl. No Transaction details Subsidiaries Joint Ventures Holding Company Enterprises having Significant Influence Key Management Personnel

Period ended September 30, 2011

Joint Ventures Holding Company Enterprises having Significant Influence Fellow Subsidiaries Key Management Personnel

Subsidiaries

Inter-corporate Deposits / loans given - Zuari Fertilisers & Chemicals Ltd - Zuari Seeds Ltd 2,055.00 1,500.00 -

Receipt of Inter-corporate Deposits / loans - Zuari Global limited 19,100.00 -

Repayment of Inter-corporate Deposits / loans given - Zuari Global limited - Zuari Fertilisers & Chemicals Ltd 4,425.00 18.00 -

Purchase of finished goods - Zuari Seeds Limited - Zuari Rotem Speciality Fertilisers Limited 894.88 2,891.98 3.49 1,021.43 -

Purchase of Assets - Indian Furniture Products Limited - Style Spa Furniture Limited 27.10 8.80 -

Interest Paid - Zuari Global Limited 29.05 -

10

Interest Received on loan/deposit - Zuari Fertilisers & Chemicals Ltd - Zuari Rotem Speciality Fertilisers Ltd - Zuari Seeds Limited - Suresh Krishnan 122.84 68.68 1.47 3.80 28.85 -

11

Management Fees Received (net of servise tax) - Zuari Seeds Limited - Zuari Global limited 62.61 10.75 -

12

Rent Paid - Zuari Global limited 21.82 -

13

Managerial Remuneration - Suresh Krishnan - Akshay Poddar 92.12 22.44 -

F-30

Balance Outstanding For the period ended 30th September 2012 Balance outstanding for the period ended 30th September 2012
Sl. No

(Rs. in lacs) Balance outstanding for the Year ended 31st March 2012

Transaction details

Key Joint Key Joint Subsidiari Ventures Enterpris managem Subsidiari Ventures Associat Enterprises managem ent having es es ent es having es Significant personnel Significan personnel Influence t Influence

Loan/ ICD Given - Zuari Fertilisers & Chemicals Ltd - Zuari Seeds Limited - Suresh Krishnan 4,380.00 1,500.00 30.00 6,750.00 -

As Trade Payables - Zuari Maroc Phosphates Limited - Zuari Indian Oiltanking Limited - Zuari Rotem Speciality Fertilisers Limited - Simon India Limited - Zuari Management Services Limited - Indian Furniture Products Limited - Style Spa Furniture Limited 18.73 1,433.46 0.43 26.14 5.30 18.80 18.91 120.43 -

As Advances Recoverable - Zuari Fertilisers & Chemicals Ltd - Paradeep Phosphates Limited - Zuari Seeds Limited - Zuari Global Limited - Adventz Infraworld India Limited - Style Spa Furniture Limited 72.91 876.59 8.78 7,167.66 1.72 4.23 104.93 1,771.47 19.11 3,454.88 -

Interest on ICD/Loan - Zuari Fertilisers & Chemicals Ltd - Zuari Seeds Limited - Suresh Krishnan 61.81 3.80 136.61 -

F-31

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 32. EarningsPerShare(EPS): Particulars ProfitaftertaxationasperstatementofProfit andLoss(Rs.inlacs) Numberofsharesusedincomputingearnings pershare BasicandDiluted* EarningspershareBasicanddiluted(in Rupees)(annualised) Facevaluepershare(inRupees) Periodended 30.09.2012 2,696.19 42,058,006 12.82 10.00 (Rs.inLacs) Periodended 30.09.2011 2,072.25 *24,575,232 16.86 10.00

*including29,440,604equitysharesappearingunderEquitySuspenseaccount. 33. The Revenue Department of the Government of Goa has issued a notification under subsection (1) of section 4 of the Land Acquisition Act, 1984 on 5th February, 2007 and further notification on 19thApril,2007proposingtoacquire159,700sq.mts.OfthelandbelongingtoCompanyforpublic purpose. The Company has filed as appeal with the High Court of Bombay at Goa against the notification. The High Court has asked status quo to be maintained on the land acquisition proceedings. 34. Employeebenefits: A) Gratuity The Company has a defined benefit gratuity plan. Every employee who has completed five years or moreofservicegetsagratuityondepartureat15dayssalary(lastdrawnsalary)foreachcompleted year of service. The scheme is funded with an insurance company in the form of a qualifying insurancepolicy. Thefollowing tablessummarizethecomponentsofnet benefitexpenserecognized inthestatement ofprofit&lossandthefundedstatusandamountsrecognizedinthebalancesheet. StatementofProfitandLoss Net employee benefit expense (recognized in Employee Cost) for the period ended 30th September, 2012 (Rs.inLacs) Particulars April1,2012to 201112 September30,2012 CurrentServiceCost 114.45 185.28 InterestCost 89.68 Expectedreturnonplanassets (104.04) (75.63) Netactuarial(gain)recognizedintheperiod (129.65) (27.72) Netbenefitexpense/(income) (29.56) 81.93
F-32

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 Balancesheet Detailsofprovisionforgratuitybenefitsasat30thSeptember,2012: (Rs.inLacs) Particulars April1,2012to 201112 September30,2012 Definedbenefitobligation 2,293.49 2,287.93 Fairvalueofplanassets 2,309.28 2,206.00 15.79* (81.93) Planasset/(liability) (38.77) (71.70) Experience(gain)/lossonobligation 7.22 Experiencegain/(loss)onplanassets *Immaterial,henceignored. Changes in the present value of the defined benefit obligation for the period ended 30th September,2012areasfollows: (Rs.inLacs) Particulars April1,2012to 201112 September30,2012 Openingdefinedobligation 2287.93 Currentservicecost 114.45 185.28 InterestCost 89.68 Benefitspaid (91.89) (159.66) Pastservicecost(Transferin) 15.75 2,290.03* Actuarial(gain)/lossonobligation (122.43) (27.72) Closingdefinedbenefitobligation 2,293.49 2,287.93 *PastservicecosttransferinonDemerger (Rs.inLacs) April1,2012to 201112 September30,2012 Openingfairvalueofplanassets 2206.00 Expectedreturn 104.05 75.63 Contributionbyemployer 83.90 Benefitspaid (91.89) (159.66) Pastservicecost(Transferin) *2,290.03 Acturialgain/(loss)onplanasset 7.22 Closingfairvalueofplanassets 2,309.28 2,206.00 The Company expects to contribute Rs. Nil (Previous year Rs. 81.93 lacs) towards gratuity during the sixmonthsperiodendedMarch31,2013. *PastservicecosttransferinonDemerger The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:

Changesinthefairvalueofplanassetsareasfollows: Particulars

Investmentwithinsurer(LifeInsuranceCorporationof India)

April1,2012to September30,2012 100%

201112 100%

F-33

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 Theoverallexpectedrateofreturnisdeterminedbasedonthemarketpricesprevailingatthatdate, applicabletotheperiodoverwhichtheobligationistobesettled.Theseratesaredifferentfromthe actualrateofreturnduringthecurrentperiod. The principal assumptions used in determining gratuity obligation for the Companys plans are shownbelow: Particulars April1,2012to 201112 September30,2012 DiscountRate 8.00% 8.00% Expectedrateofreturnonassets 9.45% 9.45% IncreaseinCompensationcost 9.00% 10.00% Employeeturnover 0.50% 0.50% a) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employmentmarket. b) The current period being the second year of adoption of AS 15 (revised) by the Company, disclosures as required by Para 120 (n) (i) of Accounting Standard 15 (Revised) have been furnishedonlyfortwoyears. c) Information in respect of period ended September 2011 is not available for above, hence not provided. B) ProvidentFund As per the Guidance Note on implementing AS15, Employee Benefits (revised 2005) issued by the Accounting Standard Board (ASB), provident funds set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as defined benefit plan. During the current period, actuarial valuation of Provident Fund was carried out in accordance with the guidance note issued by Actuary Society of India and provided Rs. 126.44 lacs (previous year Rs. 54.38 lacs) Providentfundliabilityinthebooksofaccounts. Theprincipalassumptionsusedindeterminingprovidentfundobligations: th Particulars 30 September,2012 DiscountRate NormalretirementAge 8% 58years (Rs.Inlacs) 30.09.2012 31.03.2012 30.09.2011 94.93 289.47 282.92

Particulars ContributiontoProvidentFund

F-34

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 ThedetailofFundplanassetpositionasat30thSeptember,2012isgivenbelow (Rs.Inlacs) Particulars 30.09.2012 31.03.2012 Planassetsatfairvalue 9,542.92 9,199.05 Presentvalueofdefinedbenefitobligation 9,723.74 9,253.43 Deficitinfund (180.82) (54.38) C) DefinedContributionPlan (Rs.Inlacs) Particulars Periodended Yearended Periodended 30.09.2012 31.03.2012 30.09.2011 ContributiontoSuperannuationFund 112.71 144.02 63.10 ContributiontoContributorypensionfund 69.32 100.75 34.69 Total 182.03 244.77 97.79 35. Disclosure as per Section 22 of The Micro, Small and Medium Enterprises Development Act, 2006. (Rs.inlacs) S.No. Particulars 30.09.2012 31.03.2012 i) ii) The principal amount and the interest due thereon remainingunpaidtoanysupplier: Principalamount Interestthereon the amount of interest paid by the buyer in terms of section 18, along with the amounts of the payment madetothesupplierbeyondtheappointedday. theamountofinterestdueandpayablefortheperiodof delay in making payment (which have been paid but beyond the appointed day during the year) but without addingtheinterestspecifiedunderthisAct theamountofinterestaccruedandremainingunpaid The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues above are actually paid to the smallinvestor Nil 0.24 Nil Nil 0.24 Nil

iii)

Nil

Nil

iv) v)

0.24

0.24

Nil

Nil

36. The Company has obtained office premises, apartments and warehouses on operating leases for the periodrangingfrom26years.Inallthecases,theagreementsarefurtherrenewableattheoptionof the company. There is escalation clause in the respective lease agreements. All these leases are cancellableinnature.Thetotalleasepaymentsinrespectofsuchleasesrecognizedinthestatement of profit & loss for the period are Rs. 939.55 lacs (31 March 2012: Rs.508.70 lacs, 30th September 2011:Rs.87.09lacs). 37. During the period ended September 30th 2012, the Company has entered into Operating Lease Agreementsforvehicleswhicharenoncancellable.

F-35

ZuariAgroChemicalsLimited(FormerlyknownasZuariHoldingsLimited) NotestofinancialstatementsfortheperiodApril01,2012toSeptember30,2012 These leases have an average life of between 3 and 5 years with no renewal option included in the contracts.TherearenorestrictionsplacedupontheCompanybyenteringintotheseleases. The lease payments recognized in the Statement of profit and loss during the period ended September 30th 2012 amounts to Rs.1.90 lacs (Previous year Nil ). The break up of minimum lease paymentsoutstandingasatSeptember30th2012isasfollows: Period Rs.inLacs 30.09.2012 31.03.2012 Payablewithinoneyear 12.29 Payableafteroneyearbutwithinfiveyears 34.96 Payableafterfiveyears 38. The agreement with Zuari Maroc Phosphates Limited (ZMPL) for providing management services to Paradeep Phosphates Limited, which got suspended on 1st October, 2005, continues to remain soandconsequentlynomanagementservicesfeeshasbeenaccountedfortheyear. 39. a) Current periods figures in the financial statements are audited. However, the corresponding six months period ended 30th September 2011 are unaudited but limited review was carried out by thestatutoryauditor. b) The results of the Company for the current period ended 30th September 2012 are for six months, whereas the previous periods figures included results of fertilizer undertaking from 01st July, 2011 to 30th September, 2011. Hence, previous periods figures are not comparable with thoseofcurrentperiod. 40. Previous period figures have been reclassified /regrouped where ever necessary to confirm to currentperiodsclassification. Asperourreportofevendate For and on behalf of Board of Directors of Zuari Agro Chemicals Limited

ForS.R.Batliboi&Co. S.K.PoddarSureshKrishnan MarcoWadia CharteredAccountantsChairmanManagingDirectorDirector FirmsRegistrationNo.301003E perAnilGupta VSeshadriR.Y.Patil Partner VicePresidentFinance ChiefGeneralManager MembershipNo:87921 &CompanySecretary Place:Gurgaon Place:Gurgaon Dated: November6,2012Date:November6,2012

F-36

Auditors Report To The Members of Zuari Holdings Limited 1. We have audited the attached balance sheet of Zuari Holdings Limited (the Company) as at March 31, 2012 and also the statement of profit and loss and the cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditors Report) Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order. Further to our comments in the Annexure referred to above, we report that: i. ii. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

3.

4.

iii. The balance sheet, statement of profit and loss and cash flow statement dealt with by this report are in agreement with the books of account. iv. In our opinion, the balance sheet, statement of profit and loss and cash flow statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Companies Act, 1956. v. On the basis of the written representations received from the directors, as on March 31, 2012, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on March 31, 2012 from being appointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956.

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India; a) b) c) in the case of the balance sheet, of the state of affairs of the Company as at March 31, 2012; in the case of the statement of profit and loss, of the profit for the year ended on that date; and in the case of cash flow statement, of the cash flows for the year ended on that date.

As per our report of even date

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants Per Anil Gupta Partner Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012

16 F-37

ZUARI HOLDINGS LIMITED

Annexure referred to in paragraph [3] of our report of even date Re: Zuari Holdings Limited (i) (a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets. (b) The fixed assets are physically verified by the management in a phased manner over a period of two years and accordingly, part of the fixed assets were physically verified during the year and the discrepancies observed on such verification, as compared to the book records, were not material. In our opinion, the frequency of physical verification is reasonable having regard to the size of the company and the nature of the assets. (b) The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business. (c) The Company is maintaining proper records of inventory and no material discrepancies were noticed on physical verification.

(ii) (a) The management has conducted physical verification of inventory at reasonable intervals during the year.

(iii) (a) The Company has granted loans to one company covered in the register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was ` 6,750 lacs and the year end balance or loans balance of loans granted to such parties was ` 6,750 lacs. (b) The Company has made interest-free loans to a wholly-owned subsidiary. According to the information and explanations given to us, and having regard to managements representation that the interest free loans are given to wholly-owned subsidiaries of the Company in the interest of the Companys business, the rate of interest and other terms and conditions for such loans are not prima facie prejudicial to the interest of the Company. (c) In respect of loans granted, repayment of the principal amount is as stipulated and payment of interest has been regular. (d) There is no overdue amount of loans granted to companies listed in the register maintained under Section 301 of the Companies Act, 1956. (e) The Company has taken loan from a Company covered in the Register maintained under Section 301 of the Companies Act, 1956. The maximum amount involved during the year was ` 19,100 lacs and the year end balance of loans taken from such parties was ` Nil. (f) In our opinion and according to the information and explanation given to us, the rate of interest and other terms and condition for such loans are not prima facie prejudicial to the interest of the Company.

(g) In respect of loans taken, repayment of principal amount is stipulated and payment of interest has been regular.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for the sale of goods. During the course of our audit, we have not observed any major weakness or continuing failure to correct any major weakness in the internal control system of the company in respect of these areas. (v) (a) According to the information and explanations provided by the management, we are of the opinion that particulars of contracts or arrangements referred to in Section 301 of the Companies Act, 1956 that need to be entered into the register maintained under Section 301 have been so entered. (b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements exceeding value of Rupees five lacs have been entered into during the financial year at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) The Company has not accepted any deposit from the public. (vii) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business. (viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government for the maintenance of cost records under Section 209(1)(d) of the Companies Act, 1956, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. (ix) (a) Undisputed statutory dues including Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Sales-Tax, Wealth-Tax, Service Tax, Customs Duty, Excise Duty, Cess and Other Material Statutory dues have generally been regularly deposited with the appropriate authorities though there has been a slight delay in a few cases. (b) According to the information and explanations given to us, no undisputed amounts payable in respect of Provident Fund, Investor Education and Protection Fund, Employees State Insurance, Income-Tax, Wealth-Tax, Service Tax, Sales-Tax, Customs Duty, Excise Duty, Cess and Other Material Undisputed Statutory dues were outstanding, at the year end, for a period of more than six months from the date they became payable. (c) According to the information and explanations given to us, there are no dues of Income Tax, Sales-Tax, Wealth Tax, Service Tax, Customs Duty, Excise Duty and Cess which have not been deposited on account of any dispute.

17 F-38

Name of the statute Karnataka Tax on Professions, Trades, Callings and Employments Act, 1976 Demand notice from Commercial Tax Department Service Tax

Nature of dues Penalty on Professional Tax paid on Companys registered godowns. Non submission of F Form Service Tax Liability

Amount (` in lacs) 21.28 15.96 142.23

Period to which amount relates 2005-06 to 2008-09 2007-08 2006-07 to 2011-12

Forum where dispute is pending Joint Commissioner of Commercial Taxes (Appeal) High Court of Andhra Pradesh CESTAT

(x) The Company has been registered for a period of less than five years and hence we are not required to comment on whether or not the accumulated losses at the end of the financial year is fifty per cent or more of its net worth and whether it has incurred cash losses in the current financial year and in the immediately preceding financial year. (xi) Based on our audit procedures and as per the information and explanations given by the management, we are of the opinion that the Company has not defaulted in repayment of dues to banks. The Company did not have any outstanding debentures and loan from financial institution during the year. (xii) According to the information and explanations given to us and based on the documents and records produced to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities. (xiii) In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company. (xiv) In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditors Report) Order, 2003 (as amended) are not applicable to the Company. (xv) According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from bank or financial institutions. (xvi) Based on information and explanations given to us by the management, term loans were applied for the purpose for which the loans were obtained. (xvii) According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment. (xviii) The Company has made preferential allotment of shares to parties and companies covered in the register maintained under Section 301 of the Companies Act, 1956. In our opinion, the price at which shares have been issued is not prejudicial to the interest of the Company. (xix) The Company did not have any outstanding debentures during the year. (xx) The Company has not raised any money through a public issue during the year. (xxi) Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported during the course of our audit.

As per our report of even date

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants Per Anil Gupta Partner Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012

18 F-39

ZUARI HOLDINGS LIMITED

Balance Sheet as at 31st March 2012 Notes I. EQUITY AND LIABILITIES Shareholders funds (a) Share capital (b) Reserves and surplus Noncurrent liabilities (a) Deferred tax liabilities (Net) (b) Other noncurrent liabilities (c) Longterm provisions Current liabilities (a) Shortterm borrowings (b) Trade payables (c) Other Current Liabilities (d) Shortterm provisions Total ASSETS Noncurrent assets (a) Fixed assets i) Tangible assets ii) Intangible assets iii) Capital workinprogress (b) Noncurrent investments (c) Longterm loans and advances (d) Other noncurrent assets Current assets (a) Inventories (b) Trade receivables (c) Cash and bank balances (d) Shortterm loans and advances (e) Other current assets Total Summary of significant accounting policies 2.1 The accompanying notes are an integral part of the financial statements.
For and on behalf of the Board of Directors of Zuari Holdings Limited

31st March 2012 ` in Lacs

31st March 2011 ` in Lacs

3 4

4,205.80 74,253.16 78,458.96 1,494.42 4,781.15 6,275.57 2,96,501.77 74,610.48 5,647.66 5,221.69 3,81,981.60 4,66,716.13

200.00 (2.97) 197.03 0.30 0.30 197.33

5 6 7

8 6 6 7

II.

9 9(a) 10 11 12

18,966.35 73.77 1,954.02 19,749.97 9,817.85 131.40 50,693.36 72,164.89 2,95,198.04 33,259.01 11,141.55 4,259.28 4,16,022.77 4,66,716.13

197.33 197.33 197.33

13 14 15 11 12

As per our report of even date

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

19 F-40

Statement of Profit and Loss for the year ended 31st March, 2012 Notes I. Income (a) Revenue from operations (gross) Less : excise duty (b) Revenue from operations (net) (c) Other income Total Revenue Expenses (a) Cost of raw material consumed (b) Purchase of traded goods "Decrease in inventories of finished goods, (c) work-in-progress and traded goods (d) Employee benefits expense (e) Other expenses Total Earnings before interest, tax, depreciation and amortization (EBITDA) (I) - (II) (a) Depreciation and amortization expense (b) Finance costs Profit before tax Tax expenses (a) Current income tax (b) Deferred tax Total tax expense Profit for the year (III-IV) Earning per Share Basic Earnings per equity share (nominal value of share `10/31st March 2011 - `10/-) Diluted "Earnings per equity share (nominal value of share `10/31st March 2011 - `10/-) Summary of significant accounting policies The accompanying notes are an integral part of the financial statements. 16 31st March 2012 ` in Lacs 6,18,846.23 758.50 6,18,087.73 5,611.61 6,23,699.34 1,92,145.29 3,21,840.72 14,520.57 5,480.17 67,371.77 6,01,358.52 22,340.82 23 24 1,801.66 5,513.57 15,025.59 4,737.51 (29.63) 4,707.88 10,317.71 31st March 2011 ` in Lacs 0.19 0.19 0.47 0.47 (0.28) (0.28) (0.28)

17

II.

18 19 20 21 22

III.

IV.

35

30.97

(0.01)

30.97 2.1

(0.01)

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

20 F-41

ZUARI HOLDINGS LIMITED

Cash flow statement for the year ended 31st March, 2012 Sl. No. A. Year ended 31st March,2012 (` in lacs) 15,025.60 1,801.66 (10.87) 102.64 (16.93) 122.00 3,910.94 (1,365.78) (916.98) 3,626.68 Operating profit/(loss) before working capital changes Movements in working capital : Inventories Sundry debtors Other current assets Loans and advances Current liabilities and provisions Cash from operations Direct tax paid ( net of refunds) Net cash flow (used in ) operating activitites (A) B. Cash Flows From Investing Activitites Purchase of Fixed Assets Proceeds from sale of fixed assets Dividend received Fixed deposits matured Purchases of investments Sales of investments Purchase of investment in subsidiaries & joint ventures** Interest received Loans given to bodies corporates Net cash (used in ) investing activitites (B) (2,671.02) 7.03 916.98 180.00 (2,55,043.37) 2,51,588.48 (19,749.97) 1,625.80 (2,250.00) (25,396.07) 17,551.11 (2,01,876.47) 16,119.36 (2,895.03) 2,482.62 (1,68,618.41) (1,49,966.13) (3,953.08) (1,53,919.21) (180.19) (2.29) (182.48) (182.76) (182.76) 18,652.28 Year ended 31st March,2011 (` in lacs) (0.28) (0.28)

PARTICULARS Cash Flow From Operating Activitites Profit/(loss) before tax Adjustments for: Depreciation/amortisation Sundry balances written off Unrealized foreign exchange fluctuation loss Excess provision/unclaimed liabilities/unclaimed balances written back (Loss)/profit on sale on fixed assets Interest expense Interest income Dividend income

21 F-42

Sl. No. C.

PARTICULARS Cash Flows From Financing Activitites Proceeds from issuance of share capital Proceeds from Short term borrowings Proceeds from Buyers Credit Repayment of Buyers Credit Interest paid Net cash flow from financing activitites ( C ) NET (DECREASE )/INCREASE IN CASH AND CASH EQUIVALENTS (A + B + C) CASH AND CASH EQUIVALENTS (OPENING) Add : Transfer from Demerged Fertilizer Business of ZIL CASH AND CASH EQUIVALENTS (CLOSING)

Year ended 31st March,2012 (` in lacs) 1,061.74 13,460.22 2,88,491.01 (89,511.12) (2,424.80) 2,11,077.05 31,761.77 17.33 1,479.91 33,259.01

Year ended 31st March,2011 (` in lacs) 195.00 -

195.00 12.24 5.09 17.33

* Previous year`s figures have been regrouped wherever necessary to confirm to current year classification. Year ended 31st March,2012 (`in lacs) Year ended 31st March,2011 (`in lacs)

CASH AND CASH EQUIVALENTS Components of cash and cash equivalents Cash in hand with banks -on current account with banks -on cash cradit account Total cash and cash equivalents Notes: 1)

1.06 23,229.42 10,028.53 33,259.01

17.33 17.33

Pursuant to the scheme of arrangement and demerger, all the assets and liabilities pertaining to fertilizer undertaking as on 1st July, 2011 have been transferred to Zuari Holdings Limited at the book value, the said demerger is considered as cash neutral for the purpose of cash flow. ** Includes purchase of investments in subsidiaries, happenned through cash and cash equivalent.

2)

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

22 F-43

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 1. Corporate Information This Company is a public limited company domiciled in India and incorporated under the provisions of the Companies Act 1956. It was incorporated on 10th September 2009 with object of to carry on the business of investment, holding an investment trust and for that purpose to invest in, acquire, underwrite, subscribe for, hold shares, bonds, stocks, securities etc. The Shareholders of the Company at their meeting held on 12th May 2011 has passed a resolution to commence new line of business (fertilizer business) as mentioned in the clause 50 of clause III(c) of the Memorandum of Association pursuant to Section 149 (2A) of the Companies Act, 1956. Pursuant to the Scheme of Arrangement and Demerger under Section 391 to 395 of the Companies Act, 1956, between the Company and Zuari Industries Limited becoming operative with effect from 21st March 2012 (the effective date) the Fertiliser undertaking and its corresponding Assets and Liabilities of Zuari Industries Limited have vested with the Company retrospectively from 1st July 2011 (the appointed date). Accordingly, the Statement of Profit and Loss and Statement of Assets and Liabilities dealt herewith reflect the result of the activities carried out by the Zuari Industries Limited in trust for the Company pending the Scheme becoming operative. After demerger of Fertiliser Undertaking from Zuari Industries Limited, the Company is the manufacturer of chemical fertilisers. The Company is also into trading business of complex and water soluble fertilisers and seeds. The Company caters to the demand of the Farmers all over the country, through its Jaikisaan brand of Fertilisers. Basis for preparation The financial statements of the Company have been prepared in accordance with Generally Accepted Accounting Principles in India (Indian GAAP). The Company has prepared this financial statement to comply in all material respects with the Notified Accounting Standards by Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Company and are consistent with those used in previous year except for the change in accounting policy explained below.

2.

2.1 Summary of Significant Accounting Policies Change in Accounting Policies i) Presentation and disclosure of financial statements The Revised Schedule VI notified under the Companies Act, 1956 has become applicable to the Company, for preparation and presentation of its financial statements commencing from 1st April 2011. The adoption of revised schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However it has significant impact on presentation and disclosures made in the financial statements. The Company has also reclassified the previous figures in accordance with the requirements applicable in the current year. Assets and Liabilities in the balance sheet have been classified as either current or noncurrent based upon the requirements of Revised Schedule VI notified under the Companies Act 1956. An asset has been classified as current if (a) it is expected to be realized in, or is intended for sale or consumption in, the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is expected to be realized within twelve months after the reporting date; or (d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date. All other assets have been classified as noncurrent. A liability has been classified as current when (a) it is expected to be settled in the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is due to be settled within twelve months after the reporting date; or (d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. All other liabilities have been classified as noncurrent. An operating cycle is the time between the acquisition of assets for processing and their realization in cash or cash equivalents. The preparation of financial statements in conformity with Generally Accepted Accounting Principles (Indian GAAP) requires management to make estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although these estimates are based upon managements best knowledge of current events and actions, actual results could differ from these estimates. Fixed assets are stated at cost less accumulated depreciation/amortisation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.

ii) Basis of classification of Current and Non Current

iii) Use of Estimates

iv) Fixed Assets

23 F-44

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... Machinery spares which are specific to a particular item of fixed asset and whose use is expected to be irregular are capitalized as fixed assets. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including daytoday repair and maintenance expenditure and cost of replacing parts, are charged to the statement of profit and loss for the period during which such expenses are incurred. Depreciation on tangible and intangible fixed assets is provided using the Straight Line Method as per the useful lives of the assets (other than machinery spares) as estimated by the management, which are equal to the rates prescribed under Schedule XIV of the Companies Act, 1956 except for computers and peripherals which are depreciated/amortised over the useful lives of three years. For this purpose, a major portion of the plant has been considered as continuous process plant. Machinery spares are depreciated prospectively over the estimated remaining useful lives of the respective mother assets. Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in an amalgamation in the nature of purchase is their fair value as at the date of amalgamation. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any. Internally generated intangible assets, excluding capitalized development costs, are not capitalized and expenditure is reflected in the statement of profit and loss in the year in which the expenditure is incurred. Intangibles representing computer software are amortized using the straight line method over their estimated useful lives of three years. The carrying amounts of Tangible and Intangible fixed assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a prediscount rate that reflects current market assessment of the time value of the money and rates specific to that asset. After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. Inventories are valued at the lower of Cost and Net Realisable Value. The Cost is determined as follows: (a) Stores and spares, Fuel oil, Raw Materials and Packing Materials : Moving weighted average method (b) Workinprocess: Material cost on moving weighted average method and appropriate manufacturing overheads based on normal operating capacity (c) (i) Finished goods (manufactured): Material cost on moving weighted average method and appropriate manufacturing overheads based on normal operating capacity including Excise Duty (ii) Traded goods : Moving weighted average method Materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Net Realisable Value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale. Investments that are readily realisable and intended to be held for not more than a year from the date of which such investments are made are classified as current investments. All other investments are classified as longterm investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Longterm investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. Retirement and other Employee Benefits Pursuant to the Scheme of Arrangement and Demerger approved by the Honble High Court of Bombay at Goa, all the Assets, Liabilities pertaining to Fertiliser Undertaking of Zuari Industries Limited as on 1st July, 2011 have been transferred to the Company at their book values and accordingly Retirement and other benefits of employees of Fertiliser undertaking have been transferred to the Demerged entity.

v) Depreciation

vi) Intangibles

vii) Impairment

viii) Inventories

ix) Investments

x)

24 F-45

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... a) Provident Fund and Family Pension Fund Retirement benefits in the form of Provident Fund is a defined benefit obligation and is provided for on the basis of actuarial valuation of projected unit credit method made at the end of each financial year. The difference between the actuarial valuation of the provident fund of employees at the year end and the balance of own managed fund is provided for as liability in the books in terms of the provisions under Employee Provident Fund and Miscellaneous Provisions Act, 1952. Family Pension Funds is a defined contribution scheme and the contributions are charged to the Statement of Profit and Loss of the year when the contribution to the funds is due. Gratuity liability is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of each financial year. The Company has taken an insurance policy under the Group Gratuity Scheme with the Life Insurance Corporation of India (LIC) to cover the gratuity liability of the employees and amount paid/payable in respect of the present value of liability for past services as determined on actuarial valuation is charged to the Statement of Profit & Loss every year. Leave Encashment Accumulated leave, which is expected to be utilized within the next 12 months, is treated as Short term employee benefit. The Company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date The Company treats accumulated leave expected to be carried forward beyond twelve months as long term employee benefit for measurement purpose. Such long term compensated absences are provided for based on actuarial valuation using the projected unit credit method at the year end. The Company presents the entire leave as a current liability in the balance sheet, since it does not have an unconditional right to defer the settlement for 12 months after the reporting date. The Company has approved Superannuation Fund and Contributory Pension Fund which are defined contribution schemes and the contributions paid to Life Insurance Corporation of India (LIC) against the insurance policy taken with them are charged to the Statement of Profit & Loss each year. The Company does not have any other obligation other than contributions paid to LIC.

b) Gratuity

c)

d) Superannuation and Contributory Pension Fund

e) Actuarial gains/losses related to gratuity, long term compensated absences and provident fund in form of defined obligation plan are immediately taken to the Statement of Profit and Loss and are not deferred. a) Initial recognition Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Foreign currency monetary items are reported using the closing rate. Nonmonetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and nonmonetary items which are carried at fair value or other similar valuation denominated in a foreign currency, are reported using the exchange rates that existed when the values were determined. Exchange Differences Exchange differences arising on the settlement of monetary items or on reporting Companys monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognised as income or as expenses in the year in which they arise. The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Exchange differences on such contracts are recognised in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognised as income or as expense for the year.

xi) Foreign currency transactions

b) Conversion

c)

d) Forward Exchange Contracts not intended for trading or speculation purposes

xii) Revenue Recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured.

25 F-46

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... Revenue from sale of goods, including concession in respect of Urea, DAP , MOP and Complex Fertilisers receivable from the Government of India under the New Pricing Scheme/Concession Scheme, is recognized when the significant risk and rewards of ownership of the goods have passed to the customers. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economic benefits flowing to the Company. Hence, they are excluded from revenue. Excise Duty deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability assessed during the year. Concessions in respect of Urea as notified under the New Pricing Scheme is recognized with adjustments for escalation/ deescalation in the prices of inputs and other adjustments as estimated by the management in accordance with the known policy parameters in this regard. Subsidy for Phosphatic and Potassic (P&K) fertilisers are recognized as per rates notified by the Government of India in accordance with Nutrient Based Subsidy Policy from time to time. Uniform freight subsidy on Urea, Complex fertilisers, Imported DAP and MOP has been accounted for in accordance with the parameters and notified rates. Interest Income is recognised on a time proportion basis taking into account the amount outstanding and the rate applicable. Insurance claims are accounted for to the extent the Company is reasonably certain of their ultimate collection. Dividend is recognized when the shareholders right to receive payment is established by the balance sheet date. Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized to the extent they relate to the period till such assets are capitalized to the extent they relate to the period till such assets are ready to be put to use. A qualifying asset is an asset that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are recognised as an expense in the year in which they are incurred. Where the Company is the lessee Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the Statement of Profit and Loss on a straightline basis over the lease term. Tax expense comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. Deferred income taxes reflect the impact of timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Company has carry forward of unabsorbed depreciation and tax losses, deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realised against future taxable profits. Unrecognised deferred tax assets of earlier years are reassessed at each balance sheet date and recognised to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realised. The carrying amount of deferred tax assets are reviewed at each balance sheet date. The writesdown the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realised. Any such writedown is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available. A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimates required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and are adjusted to reflect the current best estimates. Basic Earnings per Share (EPS) is calculated by dividing the net profit or loss for the year attributable to the equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year.

xiii) Borrowing costs

xiv) Operating Leases

xv) Accounting for Taxes

xvi) Provisions

xvii) Earnings per Share

26 F-47

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... For the purpose of calculating diluted earnings per share, net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive Potential Equity Shares. The Company uses derivative financial instruments such as forward exchange contracts to hedge its risk associated with foreign currency fluctuations. Accounting policy for forward exchange contracts is given in note (xi) above. Cash and cash equivalents in the cash flow statement comprises cash at bank and in hand and short term investments with an original maturity periods of three months or less. Grants and subsidies from the government are recognized when there is reasonable assurance that the grant/subsidy will be received and all attaching conditions will be complied with. When the grant or subsidy relates to an expenses item, it is recognised as income over the periods necessary to match them on a systematic basis to the costs, which it is intended to compensate. Where the grant or subsidy relates to an asset, its value is deducted from the gross value of the asset concerned in arriving at the carrying amount of the related asset. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or nonoccurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognized because it is not probable that an outflow of resources will be required to settle the obligation. A contingent liability also arises in extremely rare cases where there is a liability that cannot be recognized because it cannot be measured reliably. The Company does not recognize a contingent liability but discloses its existence in the financial statements. As permitted by the guidance note on the Revised Schedule VI to the Companies Act, 1956, the Company has elected to present earnings before interest, tax, depreciation and amortization (EBIDTA) as a separate line item on the face of Statement of Profit and Loss. The Company measures EBIDTA on the basis of Profit/(Loss) from continuing operation, In its measurement, the Company does not include depreciation and amortization expense, finance costs and tax expense.

xviii) Derivative Instruments

xix) Cash and Cash equivalents

xx) Government grants and subsidies

xxi) Contingent Liabilities

xxii) Measurement of EBIDTA

This space has been intentionally left blank

27 F-48

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 3. Share Capital PARTICULARS Authorised : 4,20,58,006 (31st March 2011:: 20,00,000) Equity Shares of ` 10/ Each Issued 1,26,17,402 (31st March 2011:: 20,00,000) Equity Shares of ` 10/ Each Fully paid Subscribed and Paid up 1,26,17,402 (31st March 2011:: 20,00,000) Equity Shares of ` 10/ Each Fully paid Total Equity Share suspense account Total 1,261.74 1,261.74 2,944.06 4,205.80 200.00 200.00 200.00 1,261.74 200.00 4,205.80 4,205.80 200.00 200.00 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

Equity Share suspense represents 2,94,40,604 Equity Shares of ` 10/ each to be issued to the shareholders of Zuari Industries Limited consequent to the Scheme of Arrangement and Demerger becoming Operational from effective date, pending allotment (Refer Note. 40) a. Reconciliation of Shares Outstanding at the beginning and end of the reporting year PARTICULARS Equity Shares At the beginning of the year Issued during the year Outstanding at the end of the year Equity Share Suspense Account b. Terms/Rights Attached to equity Shares 2,000,000 10,617,402 12,617,402 29,440,604 200.00 1,061.74 1,261.74 2,944.06 2,000,000 2,000,000 200.00 200.00 31st March 2012 in Numbers ` in lacs 31st March 2011 in Numbers ` in lacs

The Company has only one class of equity shares having a par value of ` 10/ Share. Each share holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting. During the year 31st March 2012, the amount of per share dividend recognised for distribution to equity share holders was ` 3/ , subject to approval of shareholders (31st March 2011:: Nil) 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 number of equity shares held by the shareholders. Shares held by holding company and associates Out of equity shares issued by the Company, shares held by its holding company and associates is as below: PARTICULARS Zuari Industries Limited, the associate (Previous year holding Company)* 84,11,601 (31st March 2011:: 20,00,000 equity shares of ` 10/ fully paid) 31st March 2012 ` In Lacs 841.16 31st March 2011 ` In Lacs 200.00

c.

* As of 31st March 2012, Company is an associate of Zuari Industries Limited

28 F-49

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... d. Details of Shareholders holding more than 5% of equity shares in the Company (without considering equity shares to be issued as per the Scheme of Arrangement and Demerger (Refer Note 40c) Name of Shareholder

31st March 2012 31st March 2011 No. of Shares % Holding No. of Shares % Holding held in Class held in Class Zuari Industries Limited 8,411,601 66.67 2,000,000 100.00 Zuari Management Services Limited 4,205,801 33.33 Total 12,617,402 2,000,000 As per records of the Company including its register of share holders/members and other declarations received from share holders regarding beneficial interest, the above share holding represents both legal and beneficial ownership of shares. 4. Reserves and Surplus 31st March 2012 ` In Lacs 65,404.84 65,404.84 General Reserve Balance as per last financial statements Add: Amount transferred from surplus balance in the statement of profit and loss Closing Balance Surplus / (deficit) in the statement of profit and loss Balance as per last financial statements Net Profit/(loss) for the year Less : Appropriations Proposed final equity dividends of ` 3/ Per Equity Share (31st March 2011:: Nil) Tax on proposed equity dividend Transfer to general reserve Total appropriations Net surplus/(deficit) in the statement of profit and loss Total reserves and surplus 5. Deferred tax liabilities (Net) PARTICULARS Deferred tax liabilities Fixed assets Impact of difference between tax depreciation and depreciation/amortisation charged for the financial reporting Gross deferred tax liabilities Deferred tax assets Provision for doubtful debts Expenses allowable in Income tax on payment basis and deposition of Statutory dues Gross deferred tax assets Net deferred tax liabilities 31st March 2012 ` In Lacs 2,875.10 2,875.10 15.35 1,365.33 1,380.68 1,494.42 31st March 2011 ` In Lacs 1,261.74 204.68 5,000.00 6,466.42 3,848.32 74,253.16 (2.97) (2.97) 5,000.00 5,000.00 (2.97) 10,317.71 31st March 2011 ` In Lacs (2.69) (0.28)

PARTICULARS Business Restructuring Reserve [arising on 1st July,2011, being the difference of assets over liabilities on the transfer/ vesting of the Fertiliser Undertaking as per the Scheme of Arrangement and Demerger in terms of Order of Honble High Court of Bombay at Goa (Refer Note. 40)]

29 F-50

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 6. Other Liabilities Non Current PARTICULARS 31st March 2012 ` In Lacs Other Liabilities Trade deposits dealers Interest accrued but not due on loans and deposits Advances from dealers and others Payables towards capital goods Statutory and other obligations 4,781.15 4,781.15 Total 7. Provisions Long term PARTICULARS 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs Short term 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs 4,781.15 1,624.24 390.87 261.39 3,371.16 5,647.66 80,258.14 0.30 31st March 2011 ` In Lacs Current 31st March 2012 ` In Lacs 74,610.48 74,610.48 31st March 2011 ` In Lacs 0.30 0.30

Trade payables (Including acceptance) (refer note.38 for details of dues to Micro and Small Enterprises)

Provision for employee benefits Gratuity (funded)[Refer note 37(A)] Providend fund [Refer note 37(B)] Leave encashment (unfunded) Others provisions Provision for current tax (net of advance tax) Provision for wealth tax Provision for proposed equity dividend Provision for tax on proposed equity dividend Total 784.43 50.00 1,261.74 204.68 2,300.85 5,221.69 81.92 54.38 2,784.54 2,920.84

30 F-51

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 8. Short term borrowings PARTICULARS From Banks Secured a. Buyers credit (The rate of Interest on buyers credit varies between 1.00% 3.50%) and are repayable over a period of 180 360 days Unsecured a. Term loan 11.50% loan from Indian Overseas Bank (Repayable in three equal monthly instalments commencing at the end of 7th, 8th and 9th Month from the date of first availment, viz., 14th January 2012) Total 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

2,64,001.77 2,64,001.77

32,500.00 32,500.00 2,96,501.77

The buyers credit are secured by the first charge by way of hypothecation on the current assets, both present and future, wherever situated pertaining to the Company and the Companys present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets.

9. Tangible assets Particulars Cost As at 31.03.2011 Additions Disposals Addition: Due to DeMerger Scheme (Refer note No.40) As at 31.03.2012 Depreciation As at 31.03.2011 Charge for the year Deductions Addition: Due to DeMerger Scheme (Refer note No.40) As at 31.03.2012 Net block As at 31.03.2012 235.00 1,259.39 526.93 15,728.00 155.10 528.60 533.33 41.03 1.86 1,081.38 1,120.55 53.80 919.86 973.66 1,381.70 341.00 24,387.48 25,428.18 47.62 2.24 283.43 328.81 89.38 2.42 880.37 967.33 49.01 24.25 143.39 168.15 141.48 93.52 235.00 313.21 3.78 2,070.51 2,379.94 1,500.59 1,500.59 451.97 445.12 41,149.33 41,156.18 63.48 3.48 423.91 483.91 55.99 7.26 1,447.20 1,495.93 100.86 41.16 641.78 701.48 Freehold Land Buildings Railway Siding Plant & machinery Furniture & fixtures Office equipment Vehicles

(` in lacs) Total

1,126.99 500.80 47,326.84 47,953.03

1,662.54 371.77 27,695.91 28,986.68

18,966.35

31 F-52

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 9(a). Intangible assets (` in lacs) Particulars Gross block As at 31.03.2011 Purchase Deductions Addition: Due to DeMerger Scheme (Refer note No. 40) As at 31.03.2012 Amortization As at 31.03.2011 Charge for the year Deductions Addition: Due to DeMerger Scheme (Refer note No. 40) As at 31.03.2012 Net block As at 31.03.2012 73.77 73.77 139.12 573.02 712.14 139.12 573.02 712.14 785.91 785.91 785.91 785.91 Software Total

10. Non Current Investments PARTICULARS Trade Investments (valued at cost, unless otherwise stated) Unquoted Investment in subsidiaries 1,41,74,162 (31st March 2011:: nil ) Equity Shares of `10/ each fully Paid up of Zuari Seeds Limited 50,000 (31st March 2011:: nil) Equity Shares of `10/ each fully paid up of Zuari Fertilisers and chemicals Limited Investment in Joint Ventures 17,98,16,178(31st March 2011:: nil) Equity shares of `10/ each fully Paid up of Zuari Maroc Phosphates Limited 34,57,501 (31st March 2011:: nil) Equity shares of `10/ each fully Paid up of Zuari Rotem Speciality Fertilisers Limited Total Aggregate Amount of un Quoted Investments Total 17981.62 345.75 19,749.97 19,749.97 19,749.97 1,417.60 5.00 31st March 2012 31st March 2011 ` In Lacs ` In Lacs

(a) In order to commence and strengthen the Fertiliser Business the Company has invested in the equity shares of Zuari Seeds Limited, Zuari Fertilisers and Chemicals Limited, Zuari Maroc Phosphates Limited and Zuari Rotem Speciality Fertilisers Limited. The investments were purchased at book value from Zuari Industries Limited, the Holding Company in the month of May and June 2011.

32 F-53

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... (b) The Company has invested a sum of ` 1,417.60 lacs in the equity shares of Zuari Seeds Limited. Further, the Company has receivables of ` 1711.79 lacs by way of trade advances. The Company has promised to provide continuous financial support. As per the latest audited financial statements of this subsidiary, accumulated losses of this subsidiary has resulted in erosion of its entire net worth. However, the said subsidiary Company has not incurred cash loss during the current year and immediately preceeding financial year. The above Investment being in the nature of long term strategic investment and also in view of the projected profitable operations of the above company, management is of the view that the provision for diminution in the value of this investments is not required to be made there against. The Company has invested in the equity shares of Zuari Rotem Speciality Fertilisers Limited. The lock in period of the equity share is five years. The Company cannot sell, transfer or in any other way dispose off its shares or interest during the lock in period with out the prior written consent of the joint venturer. After the lock in period the Company may transfer its shares only after the other joint venturer has been granted the right of first refusal.

(c)

11. Loans and Advances Non Current PARTICULARS 31st March 2012 ` In Lacs 1,156.20 1,156.20 Security deposits Unsecured, considered good Loans and advances to related parties (Refer No. 34) Unsecured, considered good Advances recoverable in Cash or Kind Unsecured, considered good Other Loans and Advances Secured, considered good Loans to Employees (secured) Unsecured, considered good Loans to Employees Prepaid expenses VAT credit receivable Balances with Customs, Port Trust and Excise Authorities Total 257.51 399.70 9,817.85 67.03 148.01 72.82 0.60 334.69 11,141.55 142.19 46.23 6,531.13 6,531.13 7,904.89 7,904.89 4,195.49 4,195.49 357.06 357.06 80.24 80.24 31st March 2011 ` In Lacs Current 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

Capital advances Unsecured, considered good

33 F-54

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 12. Other Assets Non Current PARTICULARS 31st March 2012 ` In Lacs 130.55 130.55 Non Current bank balances (note 15) 0.85 0.85 Total 131.40 31st March 2011 ` In Lacs Current 31st March 2012 ` In Lacs 31.40 136.61 147.92 19.78 3,923.57 4,259.28 4,259.28 31st March 2011 ` In Lacs

Interest Accrued on Loans, Advances and Deposits Interest receivable from subsidiaries on loans Interest receivable from customers Interest Accrued on Loans to employees Unamortised Premium on Forward Contracts*

* The Unamortised Foreign Exchange Premium on Outstanding Forward Exchange Contracts is being carried forward to be charged to the statement of Profit and Loss of subsequent year 13. Inventories (valued at lower of cost and net realisable value) PARTICULARS Raw materials [includes material in transit ` 4,167.81 lacs (31st March 2011 :: ` Nil) and includes material lying with others ` 83.86 lacs (31st March 2011 :: ` Nil)] Packing materials [includes material lying with others ` 49.42 lacs (31st March 2011:: ` Nil)] Work in progress Finished goods Traded goods [includes material in transit ` Nil and incluldes material lying with others 714.01 lacs (31st March 2011 :: ` Nil)] Fuel Oil Stores and spares Total 479.48 1,355.70 10,853.06 22,350.99 4,937.87 4,879.20 72,164.89 31st March 2012 ` In Lacs 27,308.59 31st March 2011 ` In Lacs

34 F-55

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 14. Trade receivables Current PARTICULARS Trade receivables outstanding for a period exceeding six months from the date they are due for payment Secured, considered good Unsecured, considered good [(including subsidy receivable ` 10,551.53 (31st March, 2011:: ` Nil)] Unsecured, considered doubtful Less: Provision for doubtful debts (A) Other receivables Secured, considered good Unsecured, considered good (including subsidy receivable ` 2,01,488.91 (31st March, 2011:: ` Nil) (B) Total 15. Cash and bank balances Non Current PARTICULARS 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs Current 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs 4,209.82 2,80,431.18 2,84,641.00 2,95,198.04 1.02 10,556.02 47.31 10,604.35 47.31 10,557.04 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

Cash and cash equivalents a. Balances with banks On Current accounts On Cash credit accounts On Deposits accounts with original maturity less than three months b. Cash on hand Other bank balances Deposits with original maturity for more than 12 months [(pledged with sales tax authorities ` 0.85 lac) 31st March 2011 :: ` Nil] Total Amount disclosed under non current assets 0.85 0.85 (0.85) 33,259.01 180.00 180.00 197.33 23,229.42 10,028.53 1.06 33,259.01 17.33 14.73 2.60

35 F-56

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 16. Revenue from operations PARTICULARS Revenue from operations Sale of products Finished products Traded products Other operating revenues Scrap Sales Revenue from operations (gross) Less : Excise duty Revenue from operations (net) Details of products sold Finished Products sold: Urea Complex fertilisers of the grades : 18:46:0 10:26:26 12:32:16 19:19:19 CO2 SSP Total Traded Products sold: MOP DAP SSP SOP Complex Fertilisers Sale of Phos Acid Seeds Speciality Fertilisers Total a. b. 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

2,47,503.71 3,71,206.55 135.97 6,18,846.23 758.50 6,18,087.73

1,13,765.97 32,361.73 59,795.20 34,256.78 4,251.67 186.14 2,886.22 2,47,503.71 53,923.97 2,08,495.84 888.31 559.39 98,954.08 1,984.53 730.21 5,670.22 3,71,206.55

Sales of Finished Product and Traded Product include government subsidies. Subsidies include ` 809.10 lacs (31st March 2011 :: ` Nil) in respect of earlier years, notified during the year. Stage III of the New Pricing Scheme (NPS) for Urea was in operation from 1st October, 2006 to 31st March , 2010. As per this scheme, all naphtha based units (including the company) were required to take steps for conversion to natural gas / liquified natural gas by 31st March 2010. The Company has intiated necessary steps for conversion. Government of India vide notification dated 17th March , 2010 has extended till further orders the provisions of Stage III of NPS. Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard. Excise duty on sales amounting to ` 758.50 lacs (31 March 2011 : ` Nil) has been reduced from sales in statement of profit & loss and excise duty on increase / decrease in stock amounting to ` 1.22 lacs (31 March 2011 : ` Nil) has been considered as other income in financial statements.

c. d.

36 F-57

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 17. Other income PARTICULARS
31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

Interest Income on Bank deposits 535.73 0.19 Intercorporate loans 151.79 Government of India Fertiliser Bonds 110.71 Overdue debtors, employee loans etc. 567.55 Dividend Income on Current investments 916.98 Rent received 5.53 Excess provision/unclaimed liabilities/unclaimed balances written back 16.93 Reimbursement of loss on sale of Fertiliser Companies Government of India Special Bonds* 2,888.18 Other non operating income 418.21 Total 5,611.61 0.19 * In terms of the guidelines issued by the Government of India, Ministry of Chemicals & Fertilizers (MCF) dated 25th July, 2011 the Company had sold Fertiliser Companies Government of India Special Bond at price determined by Reserve Bank of India (RBI) resulting in a loss of ` 6,776.15 lacs. As per the guidelines, part of the loss incurred by the Company on sale of bond to RBI was to be compensated by Government. In terms of Office Memorandum dated 13th March 2012, the Government has agreed to reimburse 50% of losses incurred by the Company. However, there is a difference in the amount of losses as computed by the Company and as computed by Budget Department, Department of Economic Affairs in consultation with RBI. Pending final reconciliation certain portion of aforesaid loss, amounting to ` 2,888.18 lacs has been compensated to the Company vide Office Memorandum dated 13th March 2012 and 30th March, 2012. 18. Cost of raw materials consumed: PARTICULARS Inventory transferred on Demerger from Zuari Industries Limited Add : Purchases Add : Transfer of Stock for captive consumption Less: Inventory at the end of the year Cost of raw materials consumed Details of raw materials consumed Naphtha Phosphoric acid Muriate of potash Ammonia Purchased urea Rock phosphate Other raw materials Total Details of inventory: Raw materials Naphtha Phosphoric acid Muriate of potash Ammonia Purchased urea Rock phosphate Other raw materials Total 31st March 2012 ` In Lacs 28,999.68 1,87,311.41 3,142.79 27,308.59 1,92,145.29 73,462.68 68,159.45 29,035.69 17,587.89 1,376.26 1,370.23 1,153.09 1,92,145.29 17,481.34 7,140.30 892.71 1,234.39 300.19 44.59 215.07 27,308.59 31st March 2011 ` In Lacs

37 F-58

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 19. Details of purchase of traded products : PARTICULARS Traded products purchase details Traded fertilisers: DAP MOP SSP SOP Complex Fertilisers Speciality Fertilisers Seeds Phosphoric Acid Total 20. Decrease in inventories PARTICULARS Inventories at the end of the year Finished products Traded products Work in progress Inventories Transfered on Demerger from Zuari Industries Limited Finished products Traded products Work in progress Less : Captive consumption Total Details of Inventory Traded Goods DAP MOP SSP SOP Complex Fertilisers Speciality Fertilisers Seeds Finished Goods Urea 18:46:00 10:26:26 12:32:16 19:19:19 Others Work in Progress Ammonia Sweet Naphtha 31st March 2012 ` In Lacs 10,853.05 22,350.99 1,355.70 34,559.74 6,288.16 43,830.91 2,104.03 (3,142.79) 49,080.31 14,520.57 31st March 2011 ` In Lacs 31st March 2012 ` In Lacs 31st March 2011 ` In Lacs

1,61,375.83 55,528.26 906.41 892.98 95,167.13 5,700.49 410.04 1,859.58 3,21,840.72

1,086.45 5,669.39 23.08 330.37 10,686.44 4,014.25 541.01 22,350.99 1,671.77 2,321.18 4,280.11 455.90 1,893.04 231.06 10,853.06 11.88 1,343.82 1,355.70

38 F-59

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 21. Employee benefit expense PARTICULARS Salaries, wages and bonus Contribution to provident and other funds Gratuity (Refer Note No: 37) Staff welfare expenses Total 22. Other expenses PARTICULARS Consumption of packing materials Stores and spares consumed Power, fuel and water Bagging and other contracting charges Outward freight and handling Rent Lease rentals Rates and taxes Insurance Repairs and maintenance Buildings Plant & machinery Others Payment to statutory auditors (Refer details below) Cash rebate Excise duty on Increase/(Decrease) on inventory Subsidy claims written off Sundry balances written off Loss on fixed assets sold/discarded (net) Premium on foreign exchange forward cover Miscellaneous expenses Total Payments to statutory auditors as As statutory auditors Audit fees Tax audit fee In other capacity Certification fees, etc. Reimbursement of expenses Total 23. Depreciation and amortisation expense PARTICULARS Depreciation of tangible assets Amortization of intangible assets Total 31st March 2012 ` In Lacs 1,662.54 139.12 1,801.66 31st March 2011 ` In Lacs 31st March 2012 ` In Lacs 2,264.20 289.21 23,476.04 2,761.59 24,986.75 508.70 96.77 101.85 268.73 118.30 2,850.21 507.78 31.69 17.56 1.22 44.78 10.87 122.00 6,085.23 2,828.29 67,371.77 31st March 2011 ` In Lacs 0.13 0.33 0.01 0.47 31st March 2012 ` In Lacs 3,805.03 531.64 81.93 1,061.57 5,480.17 31st March 2011 ` In Lacs

15.34 4.49 7.87 3.99 31.69

0.33 0.33

39 F-60

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 24. Finance costs PARTICULARS Interest expense [(including interest on income tax ` 147.02 lacs, (31st March 2011:: Nil) Bank charges Total 25. Contingent liabilities not provided for: Particulars A. Demand Notices received from Sales tax authorities i) Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 200506 to 200809. The Company has filed appeal before Joint Commissioner of Commercial Taxes (Appeals), Bangalore, against the same. (The Company has deposited ` 21.28 lacs against the same which is appearing in the schedule of loans and advances) ii) Demand notice from Commercial Tax Department, towards non submission of F Form for the year 200708. The Company has filed for stay in High Court of Andhra Pradesh. Year Ended 31st March 2012 ` in Lacs Year Ended 31st March 2011 ` in Lacs 31st March 2012 ` In Lacs 3,910.94 1,602.63 5,513.57 31st March 2011 ` In Lacs

42.56

15.96

* Based on discussions with the solicitors/ favourable decisions in similar cases/ legal opinions taken by the Company, the management believes that the Company has a good chance of success in above mentioned cases and hence, no provision there against is considered necessary. 26. Estimated amount of contracts remaining to be executed not provided for Particulars Estimated amount of contracts remaining to be executed on capital account not provided for 27. Value of imports on CIF basis are in respect of Particulars Raw Materials Spare Parts Capital goods Traded goods 28. (a) Imported and indigenous raw materials consumption Particulars Indigenously obtained Imported Total (b) % 3.27 % 96.73 % 100.00 % Year Ended 31st March 2012 ` in Lacs 6,287.06 1,85,858.23 1,92,145.29 % Year Ended 31st March 2011 ` in Lacs Year Ended 31st March 2012 ` in Lacs 94,431.38 555.17 17.23 2,80,671.34 Year Ended 31st March 2011 ` in Lacs Year Ended Year Ended 31st March 2012 31st March 2011 ` in Lacs ` in Lacs 5,264.04

The Company has taken a view that Stores and Spares cover only such items as go directly into production, hence disclosure for indigenous and imported stores consumption is not disclosed.

40 F-61

ZUARI HOLDINGS LIMITED

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 29. Expenditure in foreign currency (Accrual Basis): Particulars Travelling expenses Professional fees Interest expense Year Ended 31st March 2012 ` in Lacs 36.80 39.95 2,587.99 Year Ended 31st March 2011 ` in Lacs

30. Aggregate amount of guarantees issued by the Banks to various government authorities and others are secured by a charge created by way of hypothecation ` 12,477.71 (Previous year ` Nil) 31. a) Net Foreign exchange variation charged to Statement of profit and loss Particulars Net Foreign exchange variation b) Particulars of Foreign Currency Exposures: i) Forward Contracts outstanding as at the Balance Sheet Date: 31.03.2012 57,70,13,319 31.03.2011 NIL Purpose To hedge the purchases of raw materials and traded goods and buyer credit 31.03.2012 15,04,680.00 769.74 92,46,877 4,730.38 18,67,016 955.10 1 USD = 51.1565 INR (` in lacs) Sr No 1 2 3 4 5 6 7 8 9 10 11 Particulars Proportion of ownership interest Country of incorporation Accounting period ended Assets Liabilities Revenue Depreciation Other expenses Profit before tax Contingent Liabilities Capital Commitments Zuari Maroc Phosphates Limited (Consolidated) 50% (w.e.f. 27/06/2011) (Previous year NIL) India 31.03.12 31.03.11 1,69,880.66 99,786.38 2,04,356.38 935.96 1,91,224.51 12,195.91 6,020.38 2,625.585 Zuari Rotem Speciality Fertilizer Limited 50% (w.e.f. 31/05/2011) (Previous year NIL) India 31.03.12 31.03.11 1,404.40 895.75 2,250.96 32.12 2,115.46 103.38 0.61 31.03.2011 Details of derivatives Buy (Amount in USD) Year Ended 31st March 2012 ` in Lacs 15,484.36 Year Ended 31st March 2011 ` in Lacs

ii) Unhedged foreign currency exposures as at the Balance Sheet date: Particulars Accrued Interest Trade Payables Claims Receivable USD INR (` in lacs) USD INR (` in lacs) USD INR (` in lacs) Exchange Rate

32. Information in respect of Joint Ventures:

The above details represent proportionate amount of the Companys share in the Joint Ventures.

41 F-62

NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2012 Contd..... 33. Segmental Information Primary Segment The Company is engaged in the manufacture, sale and trading of fertilisers and seeds which, in the context of Accounting Standard 17 (Segmental Information) notified by Companies (Accounting Standard) Rules, 2006 (as amended), is considered as the only business segment. Accordingly, no separate segmental information has been provided herein. Secondary Segment Geographical Segment. The Company operates in India and therefore caters to the needs of the domestic market. Therefore, there are no reportable geographical segments. The list of related parties as identified by the management are as under: i) a) Holding Company Zuari Industries Limited (up to 30th June 2011) (1) (2) (3) (4) (5) (6) (7) (8) (9) Indian Furniture Products Limited (up to 30th June 2011 and thereafter as associate) Zuari Seeds Limited (up to 31st May, 2011) Simon India Limited (up to 30th June 2011 and thereafter as associate) Zuari Fertilisers & Chemicals Limited (up to 31st May, 2011) Zuari Management Services Limited (up to 30th June 2011 and thereafter as associate) Adventz Infraworld India Limited (up to 30th June 2011 and thereafter as associate) Gulbarga Cement Limited (up to 30th June 2011 and thereafter as associate) Globex Limited (up to 30th June 2011 and thereafter as associate) Zuari Investments Limited (up to 30th June 2011 and thereafter as associate)

34. Related Party disclosures under Accounting Standard 18 A)

b) Fellow Subsidiaries

(10) Zuari Insurance Brokers Limited Subsidiary of Zuari Investments Limited (up to 30th June 2011 and thereafter as associate) (11) Zuari Commodity Trading Limited Subsidiary of Zuari Investments Limited (up to 30th June 2011 and thereafter as associate) (12) Zuari Financial Services Limited Subsidiary of Zuari Investments Limited (up to 30th June 2011 and thereafter as associate) ii) c) Enterprise having significant influence Zuari Industries Limited Subsidiaries of the Company: (1) (2) (1) (2) (3) Zuari Seeds Limited (with effect from 31/05/2011) Zuari Fertilisers & Chemicals Limited (with effect from 31/05/2011) Zuari Maroc Phosphates Limited (with effect from 27/06/2011) Paradeep Phosphates Ltd Subsidiary of Zuari Maroc Phosphates Limited Zuari Rotem Speciality Fertilisers Limited (with effect from 31/05/2011)

iii) Joint Ventures of the Company:

This space has been intentionally left blank

42 F-63

ZUARI HOLDINGS LIMITED

B. Related Party Transaction As Per Accounting Standard 18 For Zuari Holdings Limited (` In Lacs) Period ended 31st March 2012 Sl. No. Transaction details Subsidiaries Joint Ventures Holding Company Enterprises having Significant Influence 51.01 39.42 Fellow Subsidiaries Key management personnel Subsidiaries Year ended 31st March 2011 Joint Ventures Associates Fellow Subsidiaries Key management personnel Following transactions were carried out with related parties in the ordinary course of business.

Payment made on their behalf - Zuari Seeds Limited - Zuari Management Services Limited - Zuari Maroc Phosphates Limited - Paradeep Phospahtes Limited - Adventz Infraworld India Limited - Zuari Rotem Speciality Fertilisers Limited - Zuari Fertilisers & Chemicals Ltd - Zuari Indian Oiltanking Limited 0.66 14.18 20.24 32.81 1.87 38.87 80.89 23.12 1.93 3.62 0.05 -

Payment made on our behalf - Paradeep Phosphates Limited - Zuari Seeds Limited - Zuari Fertilisers & Chemicals Ltd - Zuari Industries Limited

Purchase of Investments - Zuari Industries Limited 19,745.36 115.32 19,100.00 18.00 -

Service charges paid - Zuari Indian Oiltanking Limited - Zuari Investment Limited 2,250.00 410.04 29.05 151.79 32.26 4,335.54 58.71 0.20 -

5 6 7 8

Inter-corporate Deposits / loans given - Zuari Fertilisers & Chemicals Ltd Receipt of Inter-corporate Deposits / loans - Zuari Industries limited Repayment of Inter-corporate Deposits / loans - Zuari Industries limited Purchase of finished goods - Zuari Seeds Limited - Zuari Rotem Speciality Fertilisers Limited

9 10

Interest Paid - Zuari Industries Limited Interest Received - Zuari Fertilisers & Chemicals Ltd - Zuari Rotem Speciality Fertilisers Ltd

11

Management Fees - Zuari Seeds Limited

43 F-64

C.

Balance Outstanding For The Period 31st March 2012 For Zuari Holdings Limited ` in lacs Period ended 31st March 2012 Year ended 31st March 2011 Key Fellow manageSubsiment diaries personnel 3,454.88 Subsidiaries Joint Ventures Associates Fellow Subsidiaries Key management personnel -

Sl. No.

Transaction details

Subsidiaries

Joint Ventures

Holding Company

Enterprises having Significant Influence

1 2

Loan/ ICD Given - Zuari Fertilisers & Chemicals Ltd As Trade Payables - Zuari Maroc Phosphates Limited - Zuari Indian Oiltanking Limited - Zuari Rotem Speciality Fertilisers Limited 104.93 1,771.47 136.61 18.80 18.91 120.43 19.11 6,750.00 -

As Advances Recoverable - Zuari Fertilisers & Chemicals Ltd - Paradeep Phosphates Limited - Zuari Rotem Speciality Fertilisers Limited - Zuari Maroc Phosphates Limited - Zuari Seeds Limited - Zuari Industries Limited

Interest on ICD/Loan - Zuari Fertilisers & Chemicals Ltd

35. Earnings Per Share (EPS): Year Ended 31st March 2012 ` in Lacs 10,317.71 3,33,16,619 30.97 10.00 Year Ended 31st March 2011 ` in Lacs (0.28) 20,00,000 (0.01) 10.00

Particulars Profit after taxation as per Profit and Loss account (` in lacs) Number of shares used in computing earnings per share Basic and Diluted* Earnings per share Basic and diluted (in Rupees) Face value per share (in Rupees) * including 2,94,40,604 equity shares appearing under Equity Suspense account.

36. The Revenue Department of the Government of Goa has issued a notification under subsection (1) of section 4 of the Land Acquisition Act, 1984 on 5th February, 2007 and further notification on 19th April, 2007 proposing to acquire 1,59,700 sq. mts. Of the land belonging to Company for public purpose. The Company has filed as appeal with the High Court of Bombay at Goa against the notification. The High Court has asked status quo to be maintained on the land acquisition proceedings. 37. Employee benefits: A) Gratuity The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurance company in the form of a qualifying insurance policy. The following tables summarize the components of net benefit expense recognized in the statement of profit & loss and the funded status and amounts recognized in the balance sheet.

44 F-65

ZUARI HOLDINGS LIMITED

Statement of Profit and Loss Net employee benefit expense (recognized in Employee Cost) for the year ended 31st March, 2012 (` in Lacs) Particulars Current Service Cost Expected return on plan assets Net actuarial (gain)/loss recognized in the year Net benefit expense Balance sheet Details of provision for gratuity benefits as at 31st March, 2012: (` in Lacs) Particulars Defined benefit obligation Fair value of plan assets Plan asset/(liability) Experience (gain)/loss on obligation Experience gain/(loss) on plan assets 201112 2,287.93 2,206.00 (81.93) (71.70) 201011 2011 12 185.28 (75.63) (27.72) 81.93 2010 11

Changes in the present value of the defined benefit obligation for the year ended 31st March, 2012 are as follows: (` in Lacs) Particulars Current service cost Benefits paid Past service cost( Transfer in) Actuarial (gain)/loss on obligation Closing defined benefit obligation *Past service cost transfer in on Demerger Changes in the fair value of plan assets are as follows: (` in Lacs) Particulars Expected return Benefits paid Past service cost (Transfer in) Closing fair value of plan assets *Past service cost transfer in on Demerger The major categories of plan assets as a percentage of the fair value of total plan assets are as follows: Particulars Investment with insurer (Life Insurance Corporation of India) 201112 100 % 201011 2011 12 75.63 (159.66) 2,290.03* 2206.00 2010 11 2011 12 185.28 (159.66) 2290.03* (27.72) 2287.93 2010 11

The Company expects to contribute ` 81.93 lacs (Previous year NIL) towards gratuity during the year 201213.

The overall expected rate of return is determined based on the market prices prevailing at that date, applicable to the period over which the obligation is to be settled. These rates are different from the actual rate of return during the current year.

45 F-66

The principal assumptions used in determining gratuity obligation for the Companys plans are shown below: Particulars Discount Rate Expected rate of return on assets Increase in Compensation cost Employee turnover a) b) 201112 8.00 % 9.45 % 10.00 % 0.50 % 201011

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The current year being the first year of adoption of AS-15 (Revised) by the Company, disclosures as required by Para 120 (n) (i) of Accounting Standard 15 (Revised) have been furnished only for the one year.

B)

Provident Fund Pursuant to the Scheme of Arrangement and Demerger, Provident Fund Trust of Zuari Industries Limited, is being managed by the Company. As per the Guideline Note on implementing AS15, Employee Benefits (Revised 2005) issued by the Accounting Standard Board (ASB), provident funds set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as defined benefit plan. During the current financial year, actuarial valuation of Provident Fund was carried out in accordance with the guidance note issued by Actuary Society of India and provided ` 54.38 lacs Provident fund liability in the books of accounts. There was no requirement of actuarial valuation carried out till last year since there were no employees in the last year. In view of this, comparable figures for earlier years have not been given. (` in lacs) Particulars 201112 282.92 201011

Contribution to Provident Fund

The detail of Fund plan asset position as at 31st March, 2012 is given below Particulars Plan assets at fair value Present value of defined benefit obligation Deficit in fund Amounts (` in lacs) 9,199.05 9,253.43 (54.38)

C)

Defined Contribution Plan (` in lacs) Particulars 201112 144.02 100.75 244.77 201011

Contribution to Superannuation Fund Contribution to Contributory pension fund Total

46 F-67

ZUARI HOLDINGS LIMITED

38. Disclosure as per Section 22 of The Micro, Small and Medium Enterprises Development Act, 2006. (` in lacs) S.No. i) Particulars The principal amount and the interest due thereon remaining unpaid to any supplier: Principal amount Interest thereon ii) iii) the amount of interest paid by the buyer in terms of section 18, along with the amounts of the payment made to the supplier beyond the appointed day. the amount of interest due and payable for the year of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under this Act the amount of interest accrued and remaining unpaid The amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues above are actually paid to the small investor Nil 0.24 Nil Nil Nil Nil 201112 201011

Nil 0.24 Nil

Nil Nil Nil

iv) v)

39. The Company has obtained office premises, apartment and warehouses on operating leases for the period ranging from 26 yea` In all the cases, the agreements are further renewable at the option of the company. There is escalation clause in the respective lease agreements. All these leases are cancellable in nature. The total lease payments in respect of such leases recognized in the statement profit & loss for the year are ` 508.70 lacs (31 March 2011:: ` NIL). 40. Demerger a. Pursuant to the Scheme of Arrangement and Demerger (The Scheme) between Zuari Industries Ltd. and Zuari Holding Ltd. approved by the Honble High Court of Bombay at Goa, on March 2, 2012, all the Assets, Liabilities pertaining to Fertiliser Undertaking as on 1st July, 2011 of Zuari Industries Limited have been transferred to the Company at their book values and accordingly the surplus of Assets over the Liabilities of the Fertiliser undertaking so Demerged, resulted in creation of Business Restructuring Reserve of ` 65,404.84 lacs in terms of the Order of the Honble High Court of Bombay at Goa. The said reserve be treated as free reserve and may be restricted and not utilized for declaration of dividend by the Company. The said order has been filed with the Registrar of Company on March 21, 2012. The summary of the assets and liabilities transferred from Zuari Industries Limited as on July 1, 2011 is as below: (` in lacs) Particulars Fixed Assets (Net) Current Assets , Loans and advances Amount 21,410.02 2,35,545.04 2,56,955.06 Less: Current Liabilities and Provisions Less: Loans and Borrowings (Secured and unsecured) Less: Deferred Tax liabilities 83,938.44 1,03,143.66 1,524.06 1,88,606.16 Net Transfer Equity Share Suspense Business Restructuring Reserve 68,348.90 2,944.06 65,404.84

b.

47 F-68

c. Pursuant to the Scheme, the Company has since issued 2,94,40,604 Equity Shares of ` 10/ each aggregating to ` 2944.06 lacs to the existing shareholders of the Zuari Industries Limited, in the ratio of 1 fully paid up Equity Share of ` 10/ each of Zuari Holdings Limited for each share of ` 10/ each held in Zuari Industries Limited. However, pending allotment at the year end, this amount is carried as Equity Share Capital Suspense. d. The results of the Company for the current year ended 31st March, 2012 are after giving effect to the Scheme, whereby the Fertiliser Undertaking of Zuari Industries Limited have been Demerged into the Company with appointed date of 1st July, 2011 and accordingly its previous years figures are not comparable with current year. As per the Scheme, during the period between the Appointed date and the Effective date, Zuari Industries Limited deemed to have carried on the Fertiliser Undertaking in trust on behalf of the Company. Further all profits or incomes earned and losses and expenses incurred for Fertiliser Undertaking, shall for all purpose, be deemed to be profits or income or expenditure or losses of the Company. The title deeds for immovable properties, licenses, agreements, loan documents etc. of the Company are in the process of being transfer in the name of Zuari Holdings Limited.

e.

f.

41. The agreement with Zuari Maroc Phosphates Limited (ZMPL) for providing management services to Paradeep Phosphates Limited, which got suspended on 1st October, 2005, continues to remain so and consequently no management services fees has been accounted for the year. 42. Department of Fertilizer, Government of India has issued an Office Memorandum dated July 11, 2011 where by subsidy rate applicable on closing stock of Finished Goods, Traded Goods and Raw Materials as on 31st March 2011 has been revised to subsidy rates applicable for the financial year 201011 as per the Nutrient Based subsidy policy. Accordingly the Company has adjusted its subsidy income for the current year by ` 474.19 lacs, to give impact of above mopping up adjustment. 43. During the year, there was a fire incident on the cross country petroleum pipeline owned by Terminalling service providers. Arising from this, the pipeline had to be closed down on security and consequently repairs and recertification needs. Due to consequent safety related issues, the Mormugao Port Trust authorities had also stopped clearance of other raw materials for Phosphatic and Potassic Fertilisers. These events caused disruption of 63 days in Urea Production and 20 days in Phosphatic and Potassic Fertilisers production. The pipeline was subsequently repaired, recertified and recommissioned on 19 October 2011 and clearance from Mormagao Port Trust authorities for berthing of vessel was received on 1 October 2011. Operations currently are normal. 44. Till the year ended 31 March 2011, the Company was using prerevised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended 31 March 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable to the Company. The Company has reclassified previous year figures to conform to this years classification. Except accounting for dividend on investments in subsidiaries, the adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However, it significantly impacts presentation and disclosures made in the financial statements, particularly presentation of balance sheet. Previous years figures have been regrouped / recasted, wherever necessary to confirm to this years classification.

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921

R. Y. Patil Chief General Manager & Company Secretary

Place : Gurgaon Date : 9th May, 2012

Place : Gurgaon Date : 9th May, 2012

48 F-69

ZUARI HOLDINGS LIMITED

AUDITORS REPORT TO THE BOARD OF DIRECTORS OF ZUARI HOLDINGS LIMITED ON THE CONSOLIDATED FINANCIAL STATEMENTS OF ZUARI HOLDINGS LIMITED, ITS SUBSIDIARIES AND JOINT VENTURES 1. We have audited the attached consolidated balance sheet of Zuari Holdings Limited (the Company), its subsidiaries and joint ventures (collectively, the Zuari Holdings Group) as at March 31, 2012, the consolidated statement of profit and loss and the consolidated cash flow statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Zuari Holdings Groups management and have been prepared by the management on the basis of separate financial statements and other financial information regarding components. Our responsibility is to express an opinion on these financial statements based on our audit. 2. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. We did not audit the financial statements of one subsidiary of the Zuari Holdings Group, whose financial statements reflect total assets of ` 6,834.67 lacs as at March 31, 2012, total revenues of ` 85.72 lacs and cash flows amounting to ` (245.21) lacs for the year then ended. The financial statements and other financial information of this subsidiary has been audited by other auditors, whose report has been furnished to us and our opinion is based solely on the reports of the other auditors. Based on our audit and on consideration of report of other auditors on separate financial statements and on other financial information of the components, and to the best of our information and according to the explanations given to us, we are of the opinion that the attached consolidated financial statements of the Zuari Holdings Group give a true and fair view in conformity with the accounting principles generally accepted in India: a) b) c) in the case of the Consolidated Balance Sheet, of the state of affairs of the Zuari Holdings Group as at March 31, 2012; in the case of the Consolidated Statement of Profit and Loss, of the profit of the Zuari Holdings Group for the year then ended; and in the case of the Consolidated Cash Flow Statement, of the cash flows of the Zuari Holdings Group for the year then ended.

3.

4.

As per our report of even date

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants Per Anil Gupta Partner Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012

49 F-70

Consolidated Balance Sheet as at 31st March 2012 I. EQUITY AND LIABILITIES Shareholders funds (a) Share capital (b) Reserves and surplus Minority interest Non-current liabilities (a) Long term borrowings (b) Deferred tax liabilities (c) Other long term liabilities (d) Long term provisions Current liabilities (a) Short-term borrowings (b) Trade payables (c) Other current liabilities (d) Short term provisions Total ASSETS Non-current assets (a) (b) Goodwill on consolidation (Refer note. 29 (a)) Fixed assets i) Tangible assets ii) Intangible assets iii) Capital work-in-progress Deferred tax assets Long term loans and advances Other non-current assets

Notes

31st March 2012 ` in Lacs

3 4 5 6 7 8 9

4,205.80 97,741.80 1,01,947.60 10,147.66 822.75 1,566.93 4,951.10 222.70 7,563.48

10 8 8 9

3,53,882.55 1,04,747.55 16,080.84 10,364.60 4,85,075.54 6,04,734.28

II.

1,832.98 11.1 11.2 7 12 13 32,006.52 697.60 5,026.96 1,378.03 10,541.28 140.67 51,624.04 80.98 1,07,685.70 3,74,433.48 33,824.45 12,028.52 25,057.11 5,53,110.24 6,04,734.28

(c) (d) (e)

Current assets (a) Current investments (b) Inventories (c) Trade receivables (d) Cash and bank balances (e) Short term loans and advances (f) Other current assets Total Summary of significant accounting policies The accompanying notes are an integral part of the financial statements. S. K. Poddar Chairman 2.1

14 15 16 17 12 13

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

50 F-71

ZUARI HOLDINGS LIMITED

Consolidated Statement of Profit and Loss for the year ended 31st March, 2012 I. Income (a) (b) (c) II Revenue from operations (gross) Less: excise duty Revenue from operations (net) Other income Total Revenue Expenses (a) (b) (c) (d) (e) III Cost of raw material consumed Purchase of traded goods Decrease in inventories of finished goods, work-in-progress and traded goods Employee benefits expense Other expenses Total Earnings before interest, tax, depreciation and amortization (EBITDA) (I) - (II) (a) (b) IV V Depreciation and amortization expense Finance costs 25 26 20 21 22 23 24 2,98,551.32 3,91,839.70 4,436.79 8,726.28 89,512.66 793,066.75 38,399.95 2,863.98 8,791.05 26,744.92 8,915.68 (6.16) (225.38) 0.58 8,684.73 18,060.20 1,618.43 16,441.77 30 49.35 49.35 2.1 19 18 18 8,23,631.01 1,504.63 8,22,126.38 9,340.32 8,31,466.70 Notes 31st March 2012 ` in Lacs

Profit/(loss) before tax Tax expenses (a) (b) (c) (d) Current income tax MAT credit entitlement Deferred tax Income tax expenses of earlier years

VI VII VIII IX

Total tax expense Profit for the year (III-IV) Less: Share of minority interest in profits Net Profit attributable to shareholders of Zuari Holdings Limited Earning per Share Basic : Earnings per equity share (nominal value of share ` 10/-) Diluted : Earnings per equity share (nominal value of share ` 10/-)

Summary of significant accounting policies The accompanying notes are an integral part of the financial statements.

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

51 F-72

ZUARI HOLDINGS LIMITED Consolidated Cash Flow Statement for the year ended 31 March 2012 PARTICULARS A. CASH FLOW FROM OPERATING ACTIVITIES: Profit before tax Adjustment for : Depreciation /amortisation Diminution in the value of Fertiliser Companies Government of India Special Bonds Loss on fixed assets sold/discarded (net) Bad debts written off Provision for doubtful debts, claims and advances Unrealized foreign exchange fluctuation loss Excess provision/unclaimed liabilities/unclaimed balances written back Interest expense Interest income Dividend income Operating Profit before Working Capital Changes Changes in working Capital : Inventories Sundry debtors Other assets Loans & advances Current liabilities & provisions Cash (used) in Operations Direct Tax Paid ( net of refunds) Net cash flow (used) in Operating Activities (A) 13,884.46 (2,56,731.03) 15,827.31 (8,302.07) 16,820.63 (2,18,500.70) (1,84,611.57) (7,558.06) (1,92,169.63) 2,863.98 222.61 154.62 1.09 72.60 1,484.92 (365.63) 6,937.02 (3,012.66) (1,214.34) 7,144.21 33,889.13 26,744.92 Year ended 31st March,2012 (` in lacs)

B.

CASH FLOW FROM INVESTING ACTIVITIES: Purchase of fixed assets Proceeds from sale of fixed assets Proceeds from sale of current investments Proceeds from sale of non current investments Purchase of non current investment in subsidiaries and joint ventures* Purchase of current investments Dividend received Interest received Redemption/ maturity of bank deposits (having original maturity of more than three months) Loans given to Bodies Corporates Net cash flow (used in) Investing Activities (B) (6,391.99) 40.43 3,95,318.52 2.65 (19,749.96) (3,86,840.97) 1,214.34 3,187.84 180.23 (2,000.00) (15,038.91)

52 F-73

ZUARI HOLDINGS LIMITED

PARTICULARS C. CASH FLOW FROM FINANCING ACTIVITIES: Proceeds from Issuance of Share Capital Repayment of long term borrowing Proceeds from buyers credit Repayment of buyers credit Proceeds from short term borrowings Interest paid Net cash flow from in financing activities ( C ) NET INCREASE IN CASH AND CASH EQUIVALENTS (A + B + C) CASH AND CASH EQUIVALENTS (OPENING) Add : Transfer from Demerged Fertilizer Business of ZIL Add : Transfer of Cash and Cash Equivalents of subsidiaries and joint venture Companies CASH AND CASH EQUIVALENTS (CLOSING) (Refer below) 1,061.74 (4,065.25) 3,14,919.59 (1,13,353.35) 43,256.20 (5,395.76) 2,36,423.17 29,214.63 17.33 1,479.90 3,062.59 33,774.45 as at 31st March,2012 (` in lacs) 2.23 23,739.02 10,032.30 0.90 33,774.45 Year ended 31st March,2012 (` in lacs)

CASH AND CASH EQUIVALENTS Cash in hand with banks -on current account with banks -on cash credit account on deposit account Cash and Cash Equivalents

Pursuant to the scheme of arrangement and demerger, all the assets and liabilities pertaining to fertilizer undertaking as on 1st July, 2011 have been transferred to Zuari Holdings Limited at the book value, the said demerger is considered as cash neutral for the purpose of cash flow. * Includes purchase of investments in subsidiaries, happenned through cash and cash equivalent.

As per our report of even date

For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

53 F-74

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 1. Basis for preparation of accounts The Consolidated Financial Statements relate to Zuari Holdings Limited (hereinafter referred to as the Company) and its subsidiary companies and joint venture companies (collectively hereinafter referred to as the Zuari Holdings Group). These financial statements have been prepared to comply in all material respects with the Notified Accounting Standards by Companies(Accounting Standard) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the Group. Summary of Significant Accounting Policies I) Presentation and disclosure of financial statements During the year ended March 31, 2012, the revised Schedule VI notified under the Companies Act 1956 has become applicable to the Company, for preparation and presentation of its financial statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of financial statements. However it has significant impact on presentation and disclosures made in the financial statements. Basis of classification of Current and Non Current Assets and liabilities in the balance sheet have been classified as either current or non-current based upon the requirements of revised Schedule VI notified under the Companies Act 1956. An asset has been classified as current if (a) it is expected to be realized in, or is intended for sale or consumption in, the Companys normal operating cycle ; or (b) it is held primarily for the purpose of being traded; or (c) it is expected to be realized within twelve months after the reporting date; or (d) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date. All other assets have been classified as non-current. A liability has been classified as current when (a) it is expected to be settled in the Companys normal operating cycle; or (b) it is held primarily for the purpose of being traded; or (c) it is due to be settled within twelve months after the reporting date; or (d) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after the reporting date. All other liabilities have been classified as non-current. An operating cycle is the time between the acquisition of assets for processing and their realisation in cash or cash equivalents. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles (Indian GAAP) requires management to make estimates and assumptions that affect the reported amounts, expenses, assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period. Although these estimates are based upon managements best knowledge of current events and actions, actual results could differ from these estimates. Principles of Consolidation In the preparation of these Consolidated Financial Statements, investments in Subsidiaries, and Joint Venture entities have been accounted for in accordance with AS 21(Accounting for Consolidated Financial Statements), and AS 27 (Financial Reporting of Interests in Joint Ventures) respectively notified under the Companies (Accounting Standards) Rules, 2006 (as amended). The Consolidated Financial Statements have been prepared on the following basisi. Subsidiary companies have been consolidated on a line-by-line basis by adding together the book values of the like items of assets, liabilities, income and expenses, after eliminating all significant intra-group balances and intra-group transactions and also unrealized profits or losses. Interests in the assets, liabilities, income and expenses of the Joint Ventures have been consolidated using proportionate consolidation method. For the purpose of proportionate consolidation, consolidated financial statements of the Joint Ventures and their subsidiaries have been used. Intra group balances, transactions and unrealized profits/losses have been eliminated to the extent of the Groups proportionate share.

II)

III)

ii.

iii. The difference of the cost to the Company of its investment in Subsidiaries and Joint Ventures over its proportionate share in the equity of the investee company as at the date of acquisition of stake is recognized in the financial statements as Goodwill or Capital Reserve, as the case may be. iv. Minorities interest in net profit of consolidated subsidiaries for the year has been identified and adjusted against the income in order to arrive at the net income attributable to the shareholders of the Company. Their share of net assets has been identified and presented in the Consolidated Balance Sheet separately. Where accumulated losses attributable to the minorities are in excess of their equity, in the absence of the contractual obligation on the minorities, the same have been accounted for by the holding company.

54 F-75

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... v. As far as possible, the consolidated financial statements have been prepared using uniform accounting policies for like transactions and other events in similar circumstances and are presented, to the extent possible, in the same manner as the Companys stand alone financial statements. Differences in accounting policies have been disclosed separately.

IV.

vi. The financial statements of the group entities used for the purpose of consolidation are drawn up to same reporting date as that of the Company i.e. year ended March 31, 2012. Tangible Assets Fixed assets are stated at cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Machinery spares which are specific to a particular item of fixed asset and whose use is expected to be irregular are capitalized as fixed assets. Subsequent expenditure related to an item of fixed asset is added to its book value only if it increases the future benefits from the existing asset beyond its previously assessed standard of performance. All other expenses on existing fixed assets, including day-to-day repair and maintenance expenditure and cost of replacing parts, are charged to the Statement of profit and loss for the period during which such expenses are incurred. Intangibles Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in an amalgamation in the nature of purchase is their fair value as at the date of amalgamation. Following initial recognition, intangible assets are carried at cost less accumulated amortization and accumulated impairment losses, if any. Internally generated intangible assets, excluding capitalized development costs, are not capitalized and expenditure is reflected in the Statement of profit and loss in the year in which the expenditure is incurred. Intangible representing computer software are amortized using the Straight Line Method over the estimated useful lives of three years. In case of a subsidiary company, expenditure incurred on development of new products as covered under AS-26 for which future economic benefits will flow over a period of time is amortized, over the estimated useful life of the asset or 5 years whichever is earlier, from the time the new product starts providing economic benefit. In case of a subsidiary company, Goodwill is amortized over a period of twenty years, subject to available surplus for the year before amortization of goodwill, based on the order of Honble High Court of Bombay at Panaji (Goa). i. Depreciation on Fixed Assets (except to the extent stated in para (ii) to (vii) below) is provided using the Straight Line Method as per the useful lives of the fixed assets as estimated by the management which are equal to the corresponding rates prescribed under Schedule XIV to the Companies Act, 1956. For this purpose, a major portion of the plant has been considered as continuous process plant. In case of the Parent Company,a subsidiary company, subsidiary of a joint venture and a joint venture entity, keeping in view the rapid technological advancement and high rate of obsolescence, the useful life of computer hardware and peripherals is considered as three years.

V.

VI. Depreciation

ii.

iii. Premium paid on acquisition of Leasehold Land is being amortized over the period of the respective leases. iv. Leasehold Improvements are being depreciated over the respective primary lease periods or useful lives of the assets, whichever is shorter. v. Machinery Spares are depreciated prospectively over the estimated remaining useful lives of the respective mother assets. vi. Fixed assets whose value is less than ` 5,000/- are depreciated fully in the year of purchase. vii. In respect of a subsidiary,depreciation on office equipments is provided @ 33.33% on straight line method as per the useful lives of the assets estimated by the management. VII. Goodwill Goodwill represents the difference between the Groups share in the net worth of the investee company and the cost of acquisition at each point of time of making the investment. For this purpose, the Groups share of net worth of the investee company is determined on the basis of the latest financial statements of that company available at the date of acquisition, after making necessary adjustments for material events between the date of such financial statements and the date of respective acquisition.

55 F-76

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... VIII. Impairment The carrying amounts of Tangible and Intangible fixed assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-discount rate that reflects current market assessment of the time value of money and rates specific to the asset.After impairment, depreciation is provided on the revised carrying amount of the asset over its remaining useful life. Inventories Inventories are valued at the lower of Cost and Net Realizable Value (except to the extent stated in (ii) below). The Cost for this purpose is determined as follows: a) Stores and Spares,Fuel Oil, Raw Materials and Packing Materials: Moving weighted average method (except in respect of a joint venture company, where it is determined on weighted average method) b) Work-in-process: Material cost on Moving weighted average method(except in respect of a joint venture company, where it is determined on weighted average method)and appropriate manufacturing overheads based on normal operating capacity c) Finished goods (manufactured): Material cost on Moving weighted average Method (except in respect of a joint venture company, where it is determined on weighted average method) and appropriate manufacturing overheads based on normal operating capacity including Excise Duty d) Finished goods (traded): Moving weighted average method (except in respect of a joint venture company, where it is determined on weighted average method) e) Materials and other items held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. Net Realizable Value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.

IX.

X.

ii) In respect of subsidiary of a joint venture, inventory of waste product lying at various warehouses other than factory are valued at net realizable value. Investments Investments that are readily realisable and intended to be held for not more than a year from the date of which such investments are made are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost and fair value determined on an individual investment basis. Long-term investments are carried at cost. However, provision for diminution in value is made to recognize a decline other than temporary in the value of the investments. Retirement and other Employee Benefits Pursuant to the Scheme of Arrangement and Demerger approved by the Honble High Court of Bombay at Goa, all the Assets and Liabilities pertaining to Fertiliser undertaking of Zuari Industries Limited as on 1st July, 2011 have been transferred to Parent Company at their book values and accordingly Retirement and other benefits of employees of Fertiliser undertaking have been transferred to Demerged entity. i. Provident fund and pension fund Retirement benefits in case of the Parent Company, in the form of Provident Fund is a defined benefit obligation and is provided for on the basis of actuarial valuation of projected unit credit method made at the end of each financial year. The difference between the actuarial valuation of the provident fund of employees at the year end and balance of own managed fund is provided for as liability in the books in terms of the provisions under the provisions under Employee Provident Fund and Miscellaneous Provisions Act, 1952. In case of other entities in the Zuari Holdings Group, Provident Fund and Family Pension funds is a defined contribution scheme and contributions are charged to the Statement of profit and loss of the year when the contribution to fund is due. In respect of the Group, retirement benefit in the form of gratuity is a defined benefit obligation and is provided for on the basis of an actuarial valuation on projected unit credit method made at the end of each financial year except in case of a subsidiary company and a Joint Venture Company where it is provided for on actual computation basis.

XI.

ii. Gratuity

56 F-77

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... The Parent Company, a subsidiary and a subsidiary of joint venture have taken insurance policy under the group Gratuity scheme with the Life Insurance Corporation of India (LIC) to cover the gratuity liability of the employees and the amount paid/ payable in respect of present value of liability of past services as determined on actuarial valuation is charged to the Statement of profit & loss every year.

iii. In respect of a subsidiary of a joint venture, post employment medical benefit is a defined benefit obligation which is provided for based on actuarial valuation on projected unit credit method made at the end of each financial year. iv. Leave Encashment Accumulated leave, which is expected to be utilised within the next 12 months, is treated as short-term employees benefit. The Company measures the expected cost of such absences as the additional amount that it expects to pay as a result of the unused entitlement that has accumulated at the reporting date. The Zuari Holdings Group treats accumulated leave expected to be carried forward beyond twelve months as long term employee benefit for measurement purpose. Such long term compensated absences are provided for based on actuarial valuation using the projected unit credit method at the year end. The Zuari Holdings Group presents the entire leave as a current liability in the balance sheet, since it does not have an unconditional right to defer the settlement for 12 months after the reporting date. Superannuation, Contributory Pension Fund and Death Benevolent Fund The Parent Company, a subsidiary company and a subsidiary of the joint venture have an approved Superannuation Fund and Contributory Pension Fund which are defined contribution schemes and the contributions paid to Life Insurance Corporation of India (LIC) against the insurance policy taken with them is charged to the Statement of profit & loss each year. These entities do not have any other obligation other than contributions made to the LIC. One of the subsidiary of joint venture company also has a Death Benevolent Fund which is a defined contribution scheme and the contribution paid to the Fund is charged to the Statement of profit and loss each year. The Company does not have any other obligation other than contribution made to this Fund.

v.

vi. Actuarial gains/losses related to the gratuity, long term compensated absences and provident fund in form of defined obligation plan are immediately taken to the Statement of profit and loss and are not deferred. XII. Foreign Currency Transactions i. Initial recognition: Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. Exchange differences arising on the settlement of monetary items or on reporting Groups monetary items at rates different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arise. The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the year in which the exchange rates change. Any profit or loss arising on cancellation or renewal of forward exchange contract is recognized as income or as expense for the year. In case of the Parent Company and a joint venture, grants and subsidies from the government are recognized when there is a reasonable assurance that the grant or subsidy will be received and all attaching conditions will be complied with. When the grant or subsidy relates to an expense item, it is recognized as income over the periods necessary to match them on a systematic basis to the costs, which it is intended to compensate. Where the grant or subsidy relates to an asset, its value is deducted from the gross value of the asset concerned in arriving at the carrying amount of the asset.

ii. Conversion :

iii. Exchange Differences:

iv. Forward Exchange Contracts not intended for trading or speculation purposes:

XIII. Government Grants and subsidies

57 F-78

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... XIV. Leases Operating Lease Where the Company is the lessee: Leases, where the lessor effectively retains substantially all the risks and benefits of ownership of the leased item, are classified as operating leases. Operating lease payments are recognized as an expense in the Statement of profit and loss on a straight-line basis over the lease term. Tax expense comprises current and deferred tax. Current income tax is measured at the amount expected to be paid to the tax authorities in accordance with the Income Tax Act, 1961. Deferred income taxes reflect the impact of timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date. Deferred tax assets are recognized only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. In situations where the company (within the Zuari Holdings Group), has carry forward of unabsorbed depreciation and tax losses, deferred tax assets are recognized only if there is virtual certainty supported by convincing evidence that such deferred tax assets can be realized against future taxable profits. Unrecognized deferred tax assets of earlier years are re-assessed at each balance sheet date and recognized to the extent that it has become reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which such deferred tax assets can be realized. The carrying amount of deferred tax assets are reviewed at each balance sheet date. The company (within the Zuari Holdings Group), writes-down the carrying amount of a deferred tax asset to the extent that it is no longer reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available against which deferred tax asset can be realized. Any such write-down is reversed to the extent that it becomes reasonably certain or virtually certain, as the case may be, that sufficient future taxable income will be available. MAT Credit is recognized as an asset only when and to the extent there is convincing evidence that the company (within the Zuari Holdings Group) will pay normal income tax during the specified period. In the year in which the Minimum Alternate Tax (MAT) credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in Guidance Note issued by Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Statement of profit and loss and shown as MAT Credit Entitlement. The company (within the Zuari Holdings Group) reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that company (within the Zuari Holdings Group) will pay normal income tax during the specified period

XV. Accounting for taxes

XVI. Revenue Recognition Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. i. Revenue from sale of goods, including concession in respect of Urea, Di-ammonium Phosphate (DAP), Muriate of Potash (MOP) and Complex Fertilisers receivable from the Government of India under the New Pricing Scheme /Concession Scheme, is recognized when the significant risk and rewards of ownership of the goods have passed to the customers. The Company collects sales taxes and value added taxes (VAT) on behalf of the government and, therefore, these are not economic benefits flowing to the company. Hence, they are excluded from revenue. Excise Duty deducted from turnover (gross) is the amount that is included in the amount of turnover (gross) and not the entire amount of liability assessed during the year. Concessions in respect of Urea as notified under the New Pricing Scheme is recognized with adjustments for escalation/ de-escalation in the prices of inputs and other adjustments as estimated by the management in accordance with the known policy parameters in this regard. Subsidy for Phosphatic and Potassic (P&K) fertilizers are recognized as per the rates notified by the Government of India in accordance with Nutrient Based Subsidy Policy from time to time. Uniform freight subsidy on Urea, Complex fertilizers, Imported DAP & MOP has been accounted for in accordance with the parameters and notified rates.

ii. Interest Income is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

58 F-79

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... iii. Insurance claim is accounted for to the extent the Group is reasonably certain of their ultimate collection. iv. Dividend is recognized when the shareholders right to receive payment is established by the reporting date. XVII. Borrowing costs Borrowing cost includes interest, amortization of ancillary costs incurred in connection with the arrangement of borrowings and exchange difference arising from foreign currency borrowings to the extent they are regarded as an adjustment to the interest costs. Borrowing costs that are directly attributable to the acquisition or construction of qualifying assets are capitalized to the extent they relate to the period till such assets are ready to be put to use. A qualifying asset is an asset that necessarily takes substantial period of time to get ready for its intended use. Other borrowing costs are recognized as an expense in the period in which they are incurred. A provision is recognized when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present value and are determined based on best estimates required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. Basic Earnings per Share (EPS) is calculated by dividing the net profit or loss for the year attributable to the equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive Potential Equity Shares. Some of the entities within the Group use derivative financial instruments such as forward exchange contracts to hedge their risk associated with foreign currency fluctuations. Accounting policy for forward exchange contracts is given in note (XII) above. A contingent liability is a possible obligation that arises from past events whose existence will be confirmed by the occurrence or non-occurrence of one or more uncertain future events beyond the control of the Company or a present obligation that is not recognised because it is not probable that an outflow of resources will be required to settle the obligation. A Contingent liability also arises in extremely rare cases where there is liability that cannot be recognised because it cannot be measured reliably. The Company does not recognise a contingent liability but discloses its existence in the financial statements. `Cash and cash equivalents in the cash flow statement comprises cash at bank and in hand and short term investments with original maturity periods of three months or less. As permitted by the guidance note on the Revised Schedule VI to the Companies Act, 1956, the Company has elected to present earnings before interest, tax, depreciation and amortization (EBIDTA) as a separate line item on the face of Statement of profit and loss. The Company measures EBIDTA on the basis of Profit/(Loss) from continuing operation, In its measurement, the Company does not include depreciation and amortization expense, finance costs and tax expense.

XVIII. Provision

XIX. Earnings per Share

XX. Derivative Instruments

XXI. Contingent Liabilities

XXII. Cash and Cash Equivalents

XXIII. Measurement of EBIDTA

--------------------------------This space has been intentionally left blank -----------------------------

59 F-80

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 3. Share Capital PARTICULARS Authorised : 4,20,58,006 (31st March 2011:: 20,00,000) Equity Shares of `10/ Each Issued 1,26,17,402 (31st March 2011:: 20,00,000) Equity Shares of `10/ Each Fully paid Subscribed and Paidup 1,26,17,402 (31st March 2011:: 20,00,000) Equity Shares of `10/ Each Fully paid Total Equity Share suspense account Total Equity Share suspense represents 2,94,40,604 Equity Shares of `10/ each to be issued consequent to the Scheme of Arrangement and Demerger becoming Operational from effective date, pending allotment (Refer note 46) a. Reconcilation of shares outstanding at the beginning and end of the reporting year Equity Shares At the beginning of the year Issued during the year Outstanding at the end of the year Equity share suspense account 31st Mar 2012 in Numbers 2,000,000 10,617,402 12,617,402 29,440,604 ` in lacs 200.00 1,061.74 1,261.74 2,944.06 1,261.74 1,261.74 2,944.06 4,205.80 1,261.74 4,205.80 4,205.80 Year ended 31st March,2012 (` in lacs)

b. Terms/Rights attached to equity Shares The parent company has only one class of equity shares having a par value of ` 10/ Share. Each share holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by Board of Directors is subject to the approval of shareholders in the ensuing Annual General Meeting. During the year 31st March 2012, the amount of per share dividend recognised as distribution by the parent company to equity shareholders was ` 3.00/ 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 number of equity shares held by the shareholders. c. Shares held by the Holding Company and Associates Out of the equity shares issued by the parent company, shares held by its holding company and associate is as below: Name of Shareholder Zuari Industries Limited, the associate company (Previous year holding company)* 84,11,601 (31st March 2011:: 20,00,000 equity shares of ` 10/ each fully paid) 31st Mar 2012 841.16

* As of 31st March 2012, the parent company is an associate of Zuari Industries Limited)

60 F-81

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... d. Details of Shareholders holding more than 5% of shares in the Company (without considering equity shares to be issued as per the Scheme of Arrangement and Demerger (Refer note. 46) Name of Shareholder Zuari Industries Limited Zuari Management Services Limited Total As at 31 March 2012 No. of Shares held 8,411,601 4,205,801 12,617,402 % Holding in Class 66.67 33.33 100.00

As per records of the Parent Company including its register of share holders/members and other declarations received from share holders regarding beneficial interest, the above share holding represents both legal and beneficial ownership of shares. Reserves and Surplus PARTICULARS Capital Reserve (Arising on Consolidation, Refer Note No. 29 (b)) Closing Balance Business Restructuring Reserve (arising on 1st July,2011 being the difference of assets over liabilities on the transfer/vesting of the Fertiliser Undertaking as per the Scheme of Arrangement and Demerger in terms of Order of Honble High Court of Bombay (Refer note 46) Closing Balance General Reserve Balance as per last financial statements Add: Amount transferred from surplus balance in the statement of profit and loss Closing Balance Surplus / (deficit) in the statement of profit and loss Balance as per last financial statements Net Profit for the year Less : Appropriations Proposed final equity dividends of ` 3/ Per Equity Share Tax on proposed equity dividend Transfer to general reserve Total appropriations Net surplus in the statement of profit and loss Total Reserves and Surplus 1,261.74 204.69 5,000.00 6,466.42 9,972.37 97,741.80 (2.97) 16,441.77 5,000.00 5,000.00 65,404.84 As at 31 March 2012 ` in Lacs 17,364.59 17,364.59 65,404.84

4.

61 F-82

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 5. Minority Interest Name of the Company Paradeep Phosphates Ltd. % Share of Minority Share in Equity Share in the Reserves Total 6. Long Term Borrowings PARTICULARS Indian Rupee Term Loan from Banks Less : Amount disclosed under the head Other Current Liabilities Net Amount As at 31 March 2012 Non Currnet 822.75 822.75 Current Maturities 2,966.30 2,966.30 19.55% 5,624.45 4,523.21 10,147.66 As at 31 March 2012 ` in Lacs

1. Out of the above, Loan of ` 820.00 lacs (including Current Maturities ` 310 lacs) is taken at an Interest rate of BPLR Plus 1%. The loan is repayable in 10 half yearly instalments alongwith interest, from the date of loan, viz., 7 April 2010. The loan is secured by equitable mortgage of land, hypothecation of stock in trade, book debt, plant and machinery and vehicles, both present and future of Zuari Seeds Limited. The loan is also secured by corporate guarantee provided by Zuari Industries Limited. 2. An India rupee loan of ` 469.05 lacs (including Current Maturities ` 156.30 Lacs) has been availed from Corporation Bank and carries floating interest rate at Corporation Bank Benchmark Advance Rate (COBAR) minus 2.25%. The loan is repayable in 54 monthly instalments starting from October 2010. The loan is secured by first charge against the factory land and building, plant and machinery, movable assets of the project and a negative lien on the assets of Zuari Rotem Speciality Fertilisers Limited.

3. The Balance India rupee loan of ` 2,500 lacs (including Current Maturities of ` 2,500.00 lacs) refers to Loan taken from Syndicate Bank at an Interest Rate of 9% and Repayable in 8 quarterly instalments of ` 625 Lakhs commencing from 30th June 2011. The loan is Secured by way of charge against tangible fixed assets to be created out of the loan and exclusive second charge on other fixed assets of Paradeep Phosphates Limited. Deferred tax liabilities (Net) PARTICULARS Deferred tax liabilities Fixed assets Impact of difference between tax depreciation and depreciation/amortisation charged for the financial reporting Gross deferred tax liabilities Deferred tax assets Provision for fertiliser companies government of india bonds Provision for doubtful debts Expenses allowable in Income tax on payment basis and deposition of Statutory dues Gross deferred tax assets Net deferred tax liabilities/(assets)* 837.07 164.62 3,382.76 4,384.45 188.90 4,573.35 4,573.35 As at 31 March 2012

7.

*After netting off deferred tax assets in respect of some of the entities aggregating to ` 1,378.03 lacs

62 F-83

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 8. Other Liabilities PARTICULARS Trade payables (Including acceptance) (refer note no. 48 for details of dues to Micro and Small Enterprises) Other Liabilities Trade deposits dealers Current maturities of long term borrowings Interest accrued but not due on loans and deposits Interest accrued and due on borrowings Advances from dealers and others Temporary bank overdraft Payables towards capital goods Statutory dues and other obligations Total 9. Provisions PARTICULARS Provision for employee benefits Gratuity (Refer note no. 43 (i)) Providend fund (Refer note no. 43 (iii) & (iv)) Post retirement medical benefits (Refer note no. 43 (ii)) Leave encashment Others provisions Provision for current income tax Provision for wealth tax Provision for proposed equity dividend Provision for tax on proposed equity dividend Provision for contractors Others Total 110.87 110.87 222.70 2,185.05 50.00 1,261.74 204.68 1.51 2,769.51 6,472.49 10,364.60 3.85 107.98 111.83 101.38 54.38 23.11 3,713.24 3,892.11 Longterm 31st March 2012 ` in lacs Shortterm 31st March 2012 ` in lacs 4,941.73 9.37 4,951.10 4,951.10 384.57 2,966.30 1,711.75 4.98 3,113.95 1.57 900.58 6,997.14 16,080.84 1,20,828.39 Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs 1,04,747.55 1,04,747.55

63 F-84

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... a) The movement for Provision Contractors during the year is as follows : PARTICULARS On acquisition of a joint venture (Paradeep Phosphates Limited) Additions during the year Amount used during the year Closing balance b) The movement for Provision Others during the year is as follows : 3,292.82 230.53 (496.45) (257.39) 2,769.51 On acquisition of a joint venture (Paradeep Phosphates Limited) Additions during the year Amount used during the year Unused amount reversed during the year Closing balance** ** Includes the following provisions Ground rent Port charges Employees state insurance Land compensation (including interest) Provision for others Total 10. Short term borrowings Secured From Banks a. b. Cash Credit (The rate of Interest on Cash Credit varies between 11.50% 14.25% and are repayable on demand) Buyers Credit (The rate of Interest on buyers credit varies between 1.00% 3.50% and are repayable over a period of 180 360 days) c. Short Term Loans The Loan is taken at rate of Interest of 11 13% and repayable within 60 days from the date of Balance Sheet. In addition to first charge on the current assets of the company the loan is further secured by second charge on the fixed assets of the company d. Others The Loan is taken at rate of Interest of 11 13% and repayable within 6 Months from the date of Balance Sheet. The loan is secured by Government of India Fertiliser Bonds. Secured Borrowings a. Unsecured Short term loan from banks 11.50% loan from Indian Overseas Bank (Repayable in three equal monthly instalments commencing at the end of 7th, 8th and 9th Month from the date of first availment, viz., 14th January 2012) Unsecured Borrowings Total 32,500.00 32,500.00 3,53,882.55 3,21,382.55 19,484.94 16,499.46 2,72,147.75 13,250.40 586.31 1,564.17 129.98 223.75 265.30 2,769.51 31st March,2012 105.53 8.04 (1.19) 112.38

64 F-85

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... (a) The Buyers Credit of ` 8,145.99 lacs, Cash Credit of ` 12,545.40 lacs and Secured Short Term Loan of ` 16,499.46 lacs are secured by the first charge on the entire current assets and second charge (to be created) on fixed assets of the subsidiary (Paradeep Phosphates Limited) of the joint venture company both present and future, on pari passu basis. (b) The Buyers Credit of ` 2,64,001.76 lacs are secured by the first charge by way of hypothecation on the current assets, both present and future, wherever situated pertaining to the Parent Company and the Parent Companys present and future book debts outstanding, moneys receivable, claims, bills, contracts, engagements, rights and assets. (c) In respect of a subsidiary (Zuari Seeds Limited), Cash Credit of ` 502.58 lacs from banks is secured by equitable mortgage of, land, hypothecation of stock in trade, book debt, plant and machinery and vehicles, both present and future. The cash credit is repayable on demand and carries interest of Base rate + 2.75 % to 4.75 % for the banks. The cash credit is also secured by corporate guarantee provided by Zuari Industries Limited. (d) Cash credit ` 202.42 lacs is availed from Corporation Bank and carries floating rate of interest at Corporation Bank Benchmark Advance Rate (COBAR) plus 1.85%. is repayable on demand and is secured by hypothecation of inventory cum book debts and all current assets of a joint venture i.e. Zuari Rotem Speciality Fertilisers Limited.

11.1 Tangible assets Freehold Land Land (lease-hold) Cost As at 31.03.2011 Addition: Due to De-Merger Scheme Refer note No. 60 b) Addition on acquisition of Subsidiaries/Joint Ventures Additions during the year Disposals during the year As at 31.03.2012 Depreciation As at 31.03.2011 Addition: Due to De-Merger Scheme (Refer note No. 60 b) Addition on acquisition of Subsidiaries/Joint Ventures Charge for the year Deductions during the year As at 31.03.2012 Net block As at 31.03.2012
1,081.38 919.86 24,387.48 283.43 880.37 143.39 27,695.91 93.51 2,070.51 1,500.58 41,149.33 423.90 1,447.18 641.77 47,326.78

Buildings

Railway Sidings

Plant & machinery

Furniture Office & fixtures equipment

Vehicles

Total

250.63 141.48 485.62

46.45 11,207.19 1,043.31 3.78

441.20 1,941.78

28,591.59 1,316.60 719.63 70,337.89

317.60 104.92 8.32

458.29 114.99 14.52

216.44 41,529.39 107.89 52.23 2,829.19 798.48

46.45 14,317.23

838.10 2,005.94

913.87 90,886.88

485.62

10.96 2.37 13.33 33.12

5,517.32 292.99 1.86 6,889.83 7,427.40

401.31 54.71 1,375.88 565.90

22,664.15 2,008.31 571.23 48,488.71 21,849.18

175.15 64.84 4.00

326.20 134.79 7.53

80.91 29,176.00 63.87 28.81 2,621.88 613.43

519.42 1,333.83 318.68 672.11

259.36 58,880.36 654.51 32,006.52

(1) In respect of a subsidiary of a joint venture (Paradeep Phosphates Limited), conveyance deed /patta have been executed for 2,104.05 acres (Zuari Holdings Groups proportionate share 1,052.03 acres) against possession of 2,282.40 acres (Zuari Holdings Groups proportionate share 1,141.20 acres of land owned by the entity. (2) In respect of a subsidiary company (Zuari Seeds Limited), vehicles of the cost of ` 2.15 lacs (previous year ` 2.15 lacs) is held in the name of person other than the subsidiary company.

65 F-86

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 11.2 Intangible assets Particulars Gross block As at 31.03.2011 Addition: Due to De-Merger Scheme (Refer note No. 60 b) Addition on acquisition of Subsidiaries/Joint Ventures Purchase/Generation Deductions As at 31.03.2012 Amortization As at 31.03.2011 Addition: Due to De-Merger Scheme (Refer note No. 60 b) Addition on acquisition of Subsidiaries/Joint Ventures Charge for the year Deductions As at 31.03.2012 Net block As at 31.03.2012 573.02 279.73 172.91 1,025.66 162.38 125.08 45.17 170.25 102.79 120.12 24.02 144.14 432.43 573.02 524.93 242.10 1,340.05 697.60 785.91 312.00 90.13 1,188.04 283.04 10.00 273.04 576.57 576.57 785.91 1,171.61 90.13 10.00 2,037.65 Software Internally Generated Asset Goodwill (as per scheme of amalgamation) (` in lacs) Total

In respect of a subsidiary company (Zuari Seeds Limited) goodwill, which arose on account of merger with Greentech Seeds International Pvt. Limited with the Company, has been amortized during the year, pursuant to the scheme of Amalgamation approved by the High Court of Bombay at Panaji (Goa). As per the order of the High Court of Bombay at Panaji (Goa), Goodwill needs to be amortized over a period of twenty years, without having regard to the Accounting Standard, subject to available surplus for the year before amortization of goodwill. 12. Loans and Advances
PARTICULARS Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

(Considered good unless otherwise stated) Capital advances Unsecured, considered good Related Parties Others Sales tax & entry tax deposits Unsecured, considered good Doubtful Less : Provision for Doubtful Advances Security deposits Unsecured, considered good Doubtful 740.23 29.72 769.95 115.09 115.09 2.23 2.23 2.23 1,070.90 1,070.90 1,070.90 255.87 5,660.07 5,915.94

66 F-87

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd....
PARTICULARS Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

Less : Provision for Doubtful Advances Loans and advances to related parties Unsecured, considered good Advances recoverable in cash or kind Unsecured, considered good Inter corporate deposits Others Doubtful Less : Provision for Doubtful Advances Other Loans and Advances Secured, considered good Loans to employees Unsecured, considered good Loans to employees MAT credit entitement Advance income tax (net of provision for income tax) Prepaid expenses VAT credit receivable Sales tax paid under protest Balances with customs, port trust, excise authorities and other government authorities

29.72 740.23 3,454.89 3,454.89

115.09 24.74 24.74

253.56 253.56 253.56

2,000.00 8,216.54 10,216.54 10,216.54

142.19 257.51 30.52 430.22 10,541.28

46.24 67.22 11.70 399.91 72.82 1.57 1.79 601.25 12,028.52

One of the joint venture (Zuari Rotem Speciality Fertilisers Limited) has till date recognised ` 30.52 lacs as Minimum Alternate Tax (MAT) credit entitlement which represents that portion of the MAT Liability, the credit of which would be available based on the provision of Section 115 JAA of the Income tax Act, 1961. The management based on the future profitability projections and also profit earned during the year is confident that there would be sufficient taxable profits in future which will enable the joint venture to utilize the above MAT credit entitement.
Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

13. Other Assets

PARTICULARS

(Unsecured, considered good unless stated otherwise stated) Interest accrued on GOI bonds, loans and advances and deposits Interest receivable form customers Interest Accrued on Loans to employees Unamortised premium on forward contracts* Discarded fixed assets 130.55 525.20 147.92 19.78 4,214.92 1.39

67 F-88

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd....
PARTICULARS Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

130.55 Fertilisers Companies Government of India Bonds (net of dimunition) Non current bank balances (Note 17) Total 10.12 10.12 140.67

4,909.21 20,147.90 20,147.90 25,057.11

* The unamortised foreign exchange premium on outstanding forward exchange contracts is being carried forward to be charged to statement of profit and loss of subsequent year. Details of gross value of Fertiliser Companies Government of India Special Bonds which are pledged as security towards borrowings are as follows :
PARTICULARS

31st March 2012 Rs In lacs 13,448.50 2,571.28 7,271.25 23,291.03

7.00% Fertiliser Companies Government of India Special Bonds 2022 6.20 % Fertiliser Companies Government of India Special Bonds 2022 6.65 % Fertiliser Companies Government of India Special Bonds 2023 Total (represents proportionate share of the Zuari Holdings Group, in respect of the subsidiary of the joint venture) The afforsaid bonds have been valued at market rates published by Clearing Corporation of India Limited (CCIL). 14. Current Investments
PARTICULARS

31 March 2012 ` in lacs 80.98 80.98 80.98 80.98

(At Lower of Cost and Net Realisable Value) Investments in Mutual Funds (unquoted) 529,679.246 Units of Reliance Liquid Fund Treasury Plan Institutional Option Daily Dividend Total Net asset value of unqouted current Investment Total 15. Inventories (valued at lower of cost and net realisable value)
PARTICULARS

31 March 2012 ` in lacs 41,389.35 842.60 5,100.15 15,970.50 32,782.59 5,666.46 5,932.94 1.11 107,685.70

Raw materials (includes in transit ` 4,167.81 lacs and includes material lying with others ` 83.86 lacs) Packing materials (includes material lying with others ` 49.42 lacs) Workinprogress Finished goods (includes in transit ` 1,063.18 lacs) Traded goods (includes in transit ` 9,077.81 and includes material lying with others ` 714.01 lacs) Fuel oil Stores and spares Waste Total

68 F-89

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 16. Trade receivables
PARTICULARS Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

Trade receivables outstanding for a period exceeding six months from the date they are due for payment Secured, considered good Unsecured, considered good (including subsidy receivable ` 16,449.92 lacs) Unsecured, considered doubtful 171.81 171.81 Less: Provision for doubtful debts (A) Other receivables Secured considered good Unsecured, considered good (including subsidy receivable ` 253,263.78 lacs) (B) Total 17. Cash and bank balances
PARTICULARS Non Current 31st March 2012 ` in lacs Current 31st March 2012 ` in lacs

14.20 16,569.54 99.95 16,683.69 99.95 16,583.74 4,357.91 353,491.83 357,849.74 374,433.48

171.81

Cash and cash equivalents a. Balances with banks On Current accounts On Cash credit accounts On Deposits accounts with original maturity less than three months b. Cash on hand Other bank balances Deposits with original Maturity more than 3 months but less then 12 Months Deposits with more than 12 months original maturity (pledged with sales tax authorities) 10.12 10.12 Amount disclosed under non current assets Total (10.12) 50.00 33,824.45 33,824.45 23,739.02 10,032.30 0.90 2.23 33,774.45

69 F-90

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 18. Revenue from operations
PARTICULARS

31 March 2012 ` in lacs 3,83,765.54 4,39,662.63 202.84 8,23,631.01 1,504.63 8,22,126.38

Sale of products Finished products Traded products Other operating revenues Scrap Sales Revenue from operations (gross) Less: Excise duty Revenue from operations (net) Details of products sold Finished Products sold: Urea DAP NPK CO2 SSP Speciality Fertilisers Sulphuric Acid Seeds Gypsum Traded Products sold: MOP DAP NPK SSP SOP Phos Acid Pesticides Seeds Ammonia Speciality Fertilisers

1,13,765.97 78,342.93 1,81,532.50 186.13 2,886.23 2,032.22 193.37 3,824.40 1,001.79 3,83,765.54 66,233.90 2,45,040.38 1,18,119.08 888.31 559.39 1,984.53 1,876.97 320.17 842.33 3,797.57 4,39,662.63 8,23,428.17

a. Sales of Finished Product and Traded Product include government subsidies. Subsidies include ` 2,094.75 lacs [including ` 1,285.65 lacs in respect of a subsidiary of a joint venture (Paradeep Phosphates Limited) being proportionate share of Zuari Holdings Group] in respect of earlier years, notified during the year. b. Stage III of the New Pricing Scheme (NPS) for Urea was in operation from 1st October, 2006 to 31st March, 2010. As per this scheme, all naphtha based units (including the Parent Company) were required to take steps for conversion to natural gas / liquified natural gas by 31st March 2010. The Company has intiated necessary steps for conversion. Government of India vide notification dated 17th March , 2010 has extended till further orders the provisions of Stage III of NPS. c. Subsidy for Urea has been accounted based on Stage III parameters of the New Pricing Scheme and other adjustments as estimated in accordance with known policy parameters in this regard. d. Excise duty on sales amounting to ` 1,504.63 lacs has been reduced from sales in statement of profit & loss and excise duty on increase / decrease in stock amounting to ` 15.26 lacs has been considered as (income) / expense in financial statements.

70 F-91

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 19. Other income
PARTICULARS

31 March 2012 ` in lacs 561.91 1,298.98 60.16 1,091.60 1,214.34 66.33 4,162.79 365.63 518.58 9,340.32

Interest Income on Bank deposits Interest on Government of India Fertiliser Bonds Intercorporate loans Overdue debtors, employee loans etc. Dividend Income on Current investments Rent Income Reimbursement of loss on sale of Fertiliser Companies Government of India Special Fertiliser Bonds Excess provisions/unclaimed liabilities/unclaimed balances written back Other nonoperating income Total

In terms of the guidelines issued by the Government of India, Ministry of Chemicals & Fertilizers (MCF) dated 31st March 2011 and 25th July, 2011 the parent company and subsidiary of joint venture (Paradeep Phosphates Limited) had sold Fertiliser Companies Government of India Special Bond at price determined by Reserve Bank of India (RBI) resulting in a loss of ` 9,785.86 lacs including ` 3,009.71 lacs in respect of Paradeep Phosphates Limited (being proportionate share of Zuari Holdings Group). As per the guidelines, part of the loss incurred by these entities on sale of bond to RBI was to be compensated by Government. In terms of Office Memorandum dated 13th March 2012, the Government has agreed to reimburse 50% of losses incurred by these entities. However, there is a difference in the losses as computed by these entities and computed by budget department, Department of Economic Affairs in consultation with RBI. Pending final reconciliation certain portion of aforesaid loss amounting to ` 4,162.79 lacs has been compensated to these entities vide Office Memorandum dated 13th March 2012. 31 March 2012 ` in lacs 49,626.39 2,87,171.49 3,142.79 41,389.35 2,98,551.32 31 March 2012 ` in lacs 1,566.75 73,462.75 96,307.92 35,563.93 3,693.41

20. Cost of Raw Materials consumed:

PARTICULARS

Inventory transferred on demerger from Zuari Industries Limited and acquisition of subsidiaries/joint ventures Add : Purchases Add : Transfer of Stock of Finished goods for captive consumption Less: Inventory at the end of the year Cost of Raw Materials Consumed Details of Raw Materials Consumed

PARTICULARS

Purchased urea Naphtha Phosphoric acid Muriate of potash Sulphuric acid

71 F-92

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd....
PARTICULARS

31 March 2012 ` in lacs 41,625.06 33,245.38 1,270.99 9,501.42 2,313.71 2,98,551.32

Ammonia Rock phosphate Raw Seeds Sulphur Others Total Details of inventory: Raw Materials
PARTICULARS

31 March 2012 ` in lacs 17,481.34 7,140.30 5,957.92 4,240.15 320.25 2,736.69 2,181.13 846.42 485.15 41,389.35

Naphtha Phosphoric acid Muriate of potash Ammonia Purchased urea Rock phosphate Sulphur Raw Seeds Others Total 21. Details of purchase of traded products:
PARTICULARS

31 March 2012 ` in lacs

Traded goods purchase details Traded fertilisers : DAP MOP SOP Phosphoric Acid SSP Speciality Fertilisers NPK Ammonia Pesticides Others Total 1,98,929.55 70,971.61 892.98 1,859.57 906.41 3,522.72 1,12,067.28 722.49 1,887.00 80.09 3,91,839.70

72 F-93

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 22. Decrease in inventories
PARTICULARS

31 March 2012 ` in lacs 15,970.50 32,782.59 5,100.15 1.11 53,854.35

Inventories at the end of the year Finished products Traded products Workinprogress Waste Inventory transferred on demerger from Zuari Industries Limited and acquisition of subsidiaries/joint ventures Finished products Traded products Workinprogress Less: Captive consumption 13,283.60 43,837.65 4,312.68 (3,142.79) 58,291.14 Total Details of Inventory Traded Goods DAP and DAP Lite MOP SOP SSP NPK Speciality Fertilisers Seeds Ammonia Pesticides 7,172.43 9,844.68 330.37 23.08 11,135.03 3,716.38 368.24 56.04 136.34 32,782.59 Finished Goods Urea DAP NPK Seeds Speciality Fertilisers Others 1,671.77 3,214.08 10,131.83 720.19 1.57 231.06 15,970.50 4,436.79

73 F-94

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... Work in Progress
PARTICULARS

31 March 2012 ` in lacs 11.88 1,343.81 219.84 2,963.94 560.68 5,100.15

Ammonia Sweet Naphtha Seeds Phosphoric Acid Sulphuric Acid

Waste Gypsum 1.11 1.11 23. Employee benefit expense

PARTICULARS

31 March 2012 ` in lacs 6,375.91 741.71 116.41 9.07 1,483.18 8,726.28

Salaries, wages and bonus Contribution to provident and other funds (Refer Note: 43(iii) & (iv)) Gratuity (Refer Note: 43(i)) Post employment medical benefits (Refer Note: 43(ii)) Staff welfare expenses Total 24. Other expenses
PARTICULARS

31 March 2012 ` in lacs

31 March 2012 ` in lacs 532.53 4,224.49 15.26 37.95 27,653.53 3,612.71 33,164.07 887.49 96.77 152.13 387.89

Stores and spares consumed Consumption of packing materials Increase in excise duty and cess on stocks Foundation seeds expenses Power, fuel and water Bagging and other contracting charges Outward freight and handling Rent Lease rentals Rates and taxes Insurance

74 F-95

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd....
PARTICULARS

31 March 2012 ` in lacs 4,885.04 337.07 651.09

31 March 2012 ` in lacs

Repairs and maintenance Plant & machinery Buildings Others Cash rebate Subsidy claims written off Sundry balances written off Diminution in the value of Fertiliser Companies Government of India Bonds Bad debts, claims and advances written off Less: Adjusted against provision Provision for doubtful debts, claims and advances Premium on foreign exchange forward cover Loss on fixed assets sold/discarded (net) Miscellaneous expenses Total 25. Depreciation and amortisation expense
PARTICULARS

5,873.20 338.03 44.78 10.87 222.61 29.33 (28.24) 1.09 72.60 6,565.38 154.62 5,464.66 89,512.66

31 March 2012 ` in lacs 2,621.88 242.10 2,863.98

Depreciation of tangible assets Amortization of intangible assets Total 26. Finance costs
PARTICULARS

31 March 2012 ` in lacs 6,937.02 1,854.03 8,791.05

Interest expense (including interest on income tax ` 147.02 lacs) Bank charges Total 27. List of Subsidiaries and Joint Ventures considered for Consolidation: a. Following Subsidiaries have been consolidated on line by line basis: Name of the Company Zuari Seeds Limited (w.e.f May 31, 2011) Zuari Fertilisers and Chemicals Limited (w.e.f May 31, 2011) Country of Incorporation India India

Proportion of Ownership Interest as at March 31, 2012 100.00% 100.00%

75 F-96

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... b. Following Joint Ventures have been consolidated on proportionate basis: Name of the Company ZuariMaroc Phosphates Limited (consolidated including its 80.45%subsidiary Paradeep Phosphates Limited) (w.e.f June 27, 2011) Zuari Rotem Speciality Fertilizers Limited (ZRSFL) (w.e.f May 31, 2011) Country of Incorporation India India Proportion of Ownership Interest as at March 31, 2012 50% 50%

During the year, Zuari Holdings Group has acquired stake in Zuari Seeds Limited, Zuari Fertilisers and Chemicals Limited (resulting in these companies becoming 100% subsidiary of Zuari Holdings Limited) and, Zuari Maroc Phosphates Limited and Zuari Rotem Speciality Fertilisers Limited (resulting these companies becoming joint venture companies of Zuari Holdings Limited). The aforesaid acquisitions have effect of increase in assets and liabilities by ` 1,83,425.35lacs and ` 1,13,236.67lacs respectively and increase in results by ` 8,348.29 in Consolidated Financial Statements. 28. Contingent Liabilities (Not Provided For): (Rs in lacs) As at March 31, 2012 Particulars I. Demands / Claims from Government Authorities ** (A) Demands from Sales Tax Authorities i) ii) Sales tax demand for the year 2007-08 in Uttar Pradesh Region was stayed by the Honble Allahabad High Court. The matter is pending before the Appellate Authority for further hearing. Demand notice from Karnataka Sales Tax Authorities (VAT) for levying penalty on Professional tax for the years 2005-06 to 2008-09. The Parent Company has filed appeal before Joint Commissioner of Commercial Taxes (Appeals), Bangalore, against the same. (The Parent Company has deposited ` 21.28 lacs against the same which is appearing in the schedule of loans and advances.) Demand notice from Commercial Tax Department, towards non submission of F Form for the year 2007-08. The Parent Company has filed for stay in High Court of Andhra Pradesh. Orissa Sales Tax Authority demanded entry tax on sale of finished goods i.e. fertilizer. The matter was remanded to the original authority for fresh assessment by the Appellate Authority as fertilizer is a non scheduled goods under the Orissa Entry Tax Act. The matter is pending before the original authority for further hearing. Branch transfers and export sales were disallowed and considered as inter state sales. (a) The matter was disposed of by the Additional Commissioner of Sales Tax (Appellate Authority) vide order dated 07.03.2012 by confirming the original demand of Assistant Commissioner of Sales tax. Paradeep Phosphates Limited has preferred an appeal before the Sales Tax Tribunal along with a stay application before the Commissioner of Commercial Taxes. The Commissioner of Commercial Taxes vide order dated 23.03.2012 has granted stay till the disposal of the appeal by the Tribunal on payment of Rs 10 crores (being proportionate share of Zuari Holdings Group). The matter is pending with Tribunal. Further, the matter has also been referred to Supreme Court by means of an Interlocutory Application. (b) The matter is pending before the Appellate Authority in connection with the branch transfer for which stay has been obtained. 45.31 Parent company & its subsidiaries *Joint ventures

42.56

iii) iv)

15.96

36.77

v)

5,210.26

28.18

76 F-97

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... As at March 31, 2012 Particulars vi) Orissa Sales Tax Authority levied penalty on Entry Tax on account of Custom Duty. Paradeep Phosphates Limited has filed an appeal before the Appellate Authority against such demand which is yet to be disposed off. Countervailing Duty (CVD) paid and refund claimed on import of MOP for trading purpose. Others Parent company & its subsidiaries 12,485.56 8,553.05 *Joint ventures 32.55 28.84 0.61 172.22 382.65 75.89 7.75 2,625.59

vii) vii)

II. Other claims against the Company not acknowledged as debts** i) ii) iii) iv) Penal interest on loan from Government of India, due to delay. Industrial Dispute and Miscellaneous Labour cases pending at various forums at different stages of dispute. Interest on electricity duty on captive power generation Others

III. Aggregate amount of guarantees issued by the banks to various Government Authorities and Others IV. Estimated amount of contracts remaining to be executed on capital account not provided for V.

Other Commitments A subsidiary of a Joint Venture has entered into an agreement for loan of USD 25 million (` 12,789.13 lacs) with International Finance Corporation (IFC) for its expansion project. As per the terms of the agreement, the subsidiary company has to pay commitment and other charges based on undrawn loan balance as per the disbursement scheme which is under finalization with IFC. *Figures given in respect of Joint ventures represent proportionate share of Zuari Holdings Group in the contingent liabilities of these joint ventures. **Based on discussions with solicitors / favorable decisions in similar cases/legal opinions taken by the respective entities, the management of the respective entities believes that there is a good chance of success in above mentioned cases and hence, no provision thereagainst is considered necessary.

29. Goodwill/Capital Reserve on consolidation (a) Goodwill (on Consolidation) The Goodwill in the Consolidated Financial Statements represents the excess of the purchase consideration of investment over the Parent Companys share in the net assets of its subsidiaries Zuari Seeds Limited and ZuariFertilisers and Chemicals Limited. Investment in 1. Zuari Seeds Limited Sub-Total (1) 2. Zuari Fertilisers and Chemicals Limited Sub-Total (2) Total (1+2) Particulars (a) Cost of Investment (b) Parent Companys share in the net assets Goodwill (a-b) (c) Cost of Investment (d) Parent Companys share in the net assets Goodwill (c-d) Total Goodwill (1+2) ` in Lacs 1,417.60 (377.78) 1,795.38 5.00 (32.60) 37.60 1,832.98

Such Goodwill has been tested for impairment using the Cash Flow projections, which are based on most recent financial budgets / forecasts approved by the management.

77 F-98

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... b. Capital Reserve (on Consolidation) The Capital Reserve in the Consolidated Financial Statements represents the excess of the Zuari Holdings Limiteds share in the net assets of its joint ventures(Zuari Maroc Phosphates Limited and Zuari Rotem Speciality Fertilisers Limited) over the purchase consideration of investment. Investment in 1. Zuari Maroc Phosphate Limited Particulars (a) Parent Companys share in the net assets (b) Cost of investments (c) Adjustment of Goodwill appearing in joint ventures consolidated accounts Sub-Total (1) 2. Zuari Rotem Speciality Fertilisers Limited Capital Reserve (a-b-c) (a) Parent Companys share in the net assets (b) Cost of investments Sub-Total (2) Total (1+2) 30. Earnings Per Share (EPS): Particulars Profit after taxation as per Statement of Profit and Loss (` in lacs) Number of shares used in computing earnings per share Basic and Diluted* (in Rupees) Earnings per share - Basic (in Rupees) Face value per share (in Rupees) * including 2,94,40,604 equity shares appearing under Equity Suspense account. 31. The Revenue Department of the Government of Goa has issued a notification under sub-section (1) of Section 4 of the Land Acquisition Act, 1984 on 5th February, 2007 and further notification on 19th April, 2007 proposing to acquire 1,59,700 sq. mts. of the land belonging to the Parent Company for public purpose. The Parent Company has filed an appeal with the High Court of Bombay at Goa against the notification. The High Court has asked status quo to be maintained on the land acquisition proceedings. 32. Net foreign exchange variation debitedto the current year consolidated Statement of profit and loss aggregates ` 18,115.25lacs (including ` 2,637.33 lacs in respect of joint venture entities, being proportionate share of Zuari Holdings Group). 33. Particulars of Foreign Currency Exposures: Forward Contracts outstanding as at the Balance Sheet Date (for the Parent Company and its subsidiaries): Details of Derivatives Buy (Amount in USD) 31.03.2012 577,013,319 Purpose To hedge the purchases of raw materials and traded goods and buyers credit Year ended March 31, 2012 16,441.77 3,33,16,619 49.35 10.00 Capital Reserve (a-b) Total Capital Reserve ` in Lacs 53,282.40 17,981.62 (18,029.27) 17,251.51 438.83 345.75 93.08 17,364.59

Forward Contracts outstanding as at the Balance Sheet Date for the joint venture entities (being the proportionate share of Zuari Holdings Group): Details of Derivatives Buy (Amount in USD) 31.03.2012 31,809,006 Purpose To hedge the purchases of raw materials and traded goods

78 F-99

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... Unhedged foreign currency exposures as at the Balance Sheet Date (for the Parent Company and its subsidiaries): Nature of Exposure Trade Payables Claims receivable Trade Receivables Accrued Interest Outstanding amount in foreign currency as at 31.03.2012 9,246,877 1,867,016 15,600 1,504,680 Foreign currency Involved USD USD USD USD

Unhedged foreign currency exposures as at the Balance Sheet Date for the joint venture entities(being the proportionate share of Zuari Holdings Group): Nature of Exposure Trade Payables Interest Accrued but not due on Borrowings Advances to Suppliers 34. Operating Leases: (a) The Parent Company has obtained office premises, apartments and warehouses on operating leases for the period ranging from 2-6 years. In all cases, the agreements are further renewable at the option of the Parent Company. There is escalation clause in the respective lease agreements. All the leases are cancellable in nature. The total lease payments in respect of such leases recognized in the Statement of profit and loss for the year are ` 508.70 lacs. In case of a subsidiary operating leases are mainly in the nature of lease of office premises and godowns with no restrictions and are renewable / cancellable at the option of either of parties. There are no subleases. The aggregate amount of operating lease payments recognized in the Statement of profit and loss is ` 89.89 lacs. Outstanding amount in foreign currency as at 31.03.2012 39,621,710 20,506 624,730 Foreign currency Involved USD USD USD

(b)

35. In respect of a subsidiary,trade payables include amount payable to a party amounting to ` 39.65 lacs (Previous year ` Nil) towards royalty which has been outstanding for a period of more than one year. Requisite approvals under the provisions of Foreign Exchange Management Act, 1999 have not been obtained from the RBI for the extension of the period. Management is confident that the penalties, if any, that may arise on account of such non-compliance would not be material. 36. (a) The subsidiary of a Joint Venture entity in an earlier year had received an Arbitration Award in its favour in the matter of Cargo Charges Tariff dispute with Paradeep Port Trust (PPT) for the years 1993 1999. PPT in earlier year had appealed with the higher authorities against such award which was confirmed by the Appellate Authority. However, as against the above order, the PPT has gone into further appeal with the High Court, which in its interim order has directed the company not to execute award at this stage, PPL has not recognized this award as income in the Statement of profit and loss . (b) Paradeep Port Trust (PPT) proposed a revision in scale of rates applicable to the company for cargo handling in the companys captive berth w.e.f. 1st April, 1999. The matter was referred to Tariff Authority of Major Ports (TAMP) on mutual consent of the parties under the direction of Honble High Court of Orissa. During the year, TAMP has finalized the rates but PPT has not agreed with the order and filed a writ petition before the High Court of Orissa against the said order. Pending disposal of the case, the company has made provision of ` 1,564.17 lacs (including ` 215.25 lacs for the year under report) [being proportionate share of Zuari Holdings Group] towards revised port charges.

37. In case of a subsidiary of a joint venture, the Land Policy of Port land has been revised as per the Land Policy Guidelines issued by the Ministry of Shipping, Government of India. Pursuant to the said Policy and pending outcome of negotiation with Paradeep Port Trust, the company has made provision towards ground rent, interest and taxes amounting to ` 586.31lacs (including ` 59.81lacs for the current year) [being proportionate share of Zuari Holdings Group] against the demand raised by Paradeep Port Trust. 38. In respect of a subsidiary of a joint venture entity, in terms of meeting for amicable settlement of dispute for additional compensation to the land losers, under the chairmanship of the Collector and District Magistrate, Jagatsinghpur, it was decided to pay additional compensation at the rate fixed to the claimants through the Special Land Acquisition Officer (Spl. LAO), Government of Orissa. Since the disbursement process to land losers has started in the financial year 2010-11 through Spl. LAO, the Company accounted

79 F-100

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... for total estimated liability of ` 283.01 lacs (including interest of ` 209.01 lacs) (being proportionate share of Zuari Holdings Group) during the financial year 2010-11. The outstanding liability as on 31st March, 2012 stands at ` 223.74 lacs(being proportionate share of Zuari Holdings Group)after making payment to Spl. LAO. 39. In pursuance of the Share Purchase agreement entered into by a Joint Venture entity (ZMPL) with the Government of India for acquisition of its subsidiary (PPL), the Joint Venture entity has preferred a claim in an earlier year on the Government of India for ` 15,155.00 lacs (proportionate share of Zuari Holdings Group ` 7,577.50lacs), which will be accounted for as and when the claim is settled. 40. In respect of a subsidiary of the joint venture (PPL), Employees State Insurance Corporation (ESIC) raised various demands from PPL in respect of both Contract Labours and Employees in earlier years, which were contested by PPL in various Courts and Authorities. Provision created in earlier years is continuing in the books and reflected in Note No. 9. 41. In respect of a subsidiary of a Joint Venture (PPL), Income Tax refund was received during the year for the Assessment Years 2008-09 & 2009-10 based on income tax returns filed by it pursuant to concession offered under BIFR and tax experts opinion with respect to allowability of certain expenditures. Subsequently, the Directorate of Income Tax (Recovery) in its letter dated 29th March, 2011 has disallowed relief u/s 41(1) of the Income Tax Act, 1961, as recommended by BIFR against which the company is planning to approach the Department to reconsider the same. Pending such, the company has retained the provision for tax of ` 2,398.18 lacs(being the proportionate share of Zuari Holdings Group) related to concession not considered by Director of Income Tax (Recovery). 42. (a) In respect of one of the subsidiary (Zuari Seeds Limited), it has accumulated losses of ` 1,696.31 lacs as at March 31, 2012 resulting in erosion of net worth fully. Based on the future projections of the company and releasing of new products, management is confident that the company will be able to generate sufficient profits in future years. As such, the financial statements of that company are prepared on a going concern basis. (b) In respect of one of the subsidiary (Zuari Fertilizers and Chemicals Limited), though the balance sheet shows a negative networth, the accounts have been prepared on going concern basis, keeping in view of the going planning and activities to setup new projects. i) The Group has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. In respect of the Parent Company, one of the subsidiary, and a subsidiary of joint venture,scheme is funded with an insurance company in the form of a qualifying insurance policy. The current year disclosures in the following tables summarize the components of the net gratuity expense recognized in the consolidated Statement of profit and loss for the Group.

43. Employee Benefits

Statement of Profit and Loss Net employee benefit expense (recognized in Employee Cost) for the year ended March 31, 2012: (` in lacs) Particulars Current Service Cost Adjustments to opening balance of Plan Assets Interest cost on benefit obligation Expected return on plan assets Net actuarial (gain)/loss recognized in the year Effect of limit Para 59(b) of AS-15-R Net benefit expense Funded 31.3.2012 235.98 (1.46) 103.80 (181.65) (43.01) (1.00) 112.67*

* Excluding ` 1.46 lacs in respect of joint venture (Zuari Rotem Speciality Fertilisers Ltd) and ` 2.28 lacs in respect of a subsidiary (Zuari Fertilisers and Chemicals Ltd) has computed the provision on actual computation basis. (refer note c below)

80 F-101

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... Balance sheet Details of Provision for gratuity benefit as at March 31, 2012: (` in lacs) Particulars Present Value of Defined benefit obligation Fair value of plan assets Plan assets/(liability) Experience gain/(loss) on obligation Funded 31.3.2012 3,736.53 3,635.16 (101.38) 71.70

* Excluding ` 1.06 lacs in respect of Joint Venture (Zuari Rotem Speciality Fertilisers Ltd.) and ` 2.80 lacs in respect of subsidiary Company (Zuari Fertilisers and Chemicals Ltd.) has computed the provision on actual computation basis. (refer note c below) Changes in the present value of the defined benefit obligation for the year ended March 31, 2012 are as follows: (` in lacs) Particulars Opening defined benefit obligation Transfer on Acquisition of stake in Subsidiaries/Joint Ventures Interest cost Current service cost Past Service Cost (Transfer in) Benefits paid Actuarial (gains)/losses on obligation Closing defined benefit obligation *Past service cost transfer in on Demerger Changes in the fair value of plan assets are as follows: (` in lacs) Particulars Opening fair value of plan assets Transfer on Acquisition of stake of subsidiaries/Joint Ventures Adjustment to opening balance Direct contribution paid by the Enterprise Expected return on plan asset Contributions by employer Past service cost(Transfer in) Gratuity (Funded) 31.3.2012 1,337.72 1.46 0.70 180.28 33.21 2,290.03* Funded 31.3.2012 1,359.33 103.80 235.98 2,290.03* (225.41) (27.20) 3,736.53

81 F-102

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... Particulars Benefits paid Actuarial gains/(losses) Direct benefits paid by the Enterprise Closing fair value of plan assets Parent company expects to contribute ` 81.93 lacs (Previous year: NIL) towards gratuity during the year 2012-13. 2) The subsidiary of a joint venture (PPL) expects to contribute ` 50 lacs (being proportionate share of Zuari Holdings Group) to the gratuity fund during 2012-13. Gratuity (Funded) 31.3.2012 (224.72) 17.18 (0.70) 3,635.15

*Past service cost transfer in on Demerger The major categories of plan assets as a percentage of the fair value of total plan assets in respect of the Group are as follows: Particulars Investment with insurer (Life Insurance Corporation of India) Gratuity 2011-12 100%

The overall expected rate of return is determined based on the market prices prevailing at that date, applicable to the period over which the obligation is to be settled. These rates are different from the actual rate of return during the current year. The principal assumptions used in determining gratuity liability are shown below: Particulars Discount Rate Expected rate of return on plan assets Increase in Compensation cost Employee turnover a) b) c) 2011-12 7.00%-8.40% 8.50%-9.45% 7.50%-12.00% 0.50%-5.00%

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. In case of the parent company, the current year being the first year of adoption of AS 15 (Revised) by the Company, disclosures as required by Para 120 (n) (i) of Accounting Standard 15 (Revised)have been furnished only for the one year. In the case of a joint venture (Zuari Rotem Speciality Fertilisers Limited) and a subsidiary (Zuari Fertilisers and Chemicals Limited), the companies have not performed any separate actuarial valuation for arriving at the Gratuity liability of the Gratuity Scheme as at March 31, 2012 as the number of employees of the Companys as at and for the year ended March 31, 2012 was below 50. These liabilities as at March 31, 2012, as reflected in the financials, have been determined on gross undiscounted basis.

(ii)

The following table summarizes the present value of obligation relating to long term post retirement medical benefit which is unfunded, in respect of a subsidiary of a joint venture. The information regarding the plan assets has not been furnished as the Company has not created any assets for the given obligation.

82 F-103

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... Statement of Profit and Loss Net employee benefit expense (recognized in Employee Cost) for the year ended March 31, 2012: (` in lacs) S. No. 1 2 3 4 5 6 Current Service Cost Interest Cost on benefit obligation Expected Return on plan assets Net Actuarial (Gains)/ Losses recognized in the year Past Service Cost Net Benefit Expense Particulars 2011-12 2.62 2.98 3.47 9.07

Balance Sheet Details of Net (Asset)/ Liability recognized in the Balance Sheet as at March 31, 2012 (` in lacs) S. No. 1 2 3 4 5 Particulars Present value of Defined Benefit Obligation as at 31st March 2012 Fair Value of Plan Assets as at 31st March, 2012 Un recognised Past service cost Un recognised past service cost non-vested benefits Net(Asset)/ Liability as at 31st March, 2012 2011-12 131.08 131.08

Changes in the present value of the defined benefit obligation for the year ended March 31, 2012 (` in lacs) S. No. 1 2 3 4 5. 6. 7 8 9 Particulars Present value of Obligation at the beginning of the year Transfer on Acquisition of stake of subsidiaries/Joint Ventures Current Service Cost Interest Cost Past service cost non-vested benefits Past service cost vested benefits Benefits paid by the Company Actuarial (Gains)/Losses on obligation Present Value of Defined Benefit Obligation at the end of the year 2011-12 125.06 2.62 2.98 (3.05) 3.47 131.08

83 F-104

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... The principal assumptions used in determining liability are shown below: (` in Lacs)

S. No. 1 2 3 4 5 Discount Rate Rate of increase in salary Withdrawal Rate Medical cost escalation rate Mortality retirement

Particulars

2011-12 8.40% p.a. 12% p.a. 5% p.a. 3% p.a. LIC (1994-96) Ultimate MortalityTable

The estimates of future salary increases, considered in actuarial valuation, take account of inflation,seniority, promotion and other relevant factors , such as supply and demand in the employment market. (iii) Provident Fund Pursuant to the Scheme of Arrangement and Demerger, Provident Fund of Zuari Industries Limited, is being managed by the Parent Company. As per Guideline Note on implementing AS-15, Employee Benefits (Revised 2005) issued by the Accounting Standard Board (ASB), provident funds set up by employers, which requires interest shortfall to be met by the employer, needs to be treated as defined benefit plan. During the current financial year, actuarial valuation of Provident Fund was carried out in accordance with the guidance note issued by Actuary Society of India and provided ` 54.38 lacs Provident Fund liability in the books of accounts. (` in lacs) Particulars Contribution to Provident Fund 2011-12 282.92

The detail of Fund plan asset position as at 31st March, 2012 is given below: (` in lacs) Particulars Plan assets at fair value Present value of defined benefit obligation Deficit in fund Details of Defined Contribution Plan in respect of the Group: Particulars Contribution to Provident Fund Contribution to Superannuation Fund Contribution to Contributory pension fund Employees Death Benevolent Fund Total 44. Segment Reporting Primary Segment The Company is engaged in the manufacture, sale and trading of fertilizers and seed which in the context of Accounting Standard 17 (Segmental Information) notified by Companies (Accounting Standard) Rules, 2006 (as amended), is considered as the only business segment. Accordingly no separate segmental information has been provided herein. Secondary Segment Geographical Segment The Company operates in India and therefore caters to the needs of the domestic market. Hence there are no reportable geographical segments. 2011-12 9,199.05 9,253.43 (54.38) (` in lacs) 2011-12 148.09 200.79 105.48 0.48 454.84

84 F-105

ZUARI HOLDINGS LIMITED

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS OF THE ZUARI HOLDINGS GROUP FOR THE FINANCIAL YEAR 2011-12 Contd.... 45. Related party disclosures under Accounting Standard 18 The list of Related Parties as identified by the management is as under: (i) Holding Company (upto June 30, 2011) (ii) 1. 1. 2. 3. 4. 5. 7. 8. 9. Zuari Industries Limited Indian Furniture Products Limited Simon India Limited Zuari Management Services Limited Adventz Infraworld India Limited Gulbarga Cement Limited Zuari Investments Limited Zuari Insurance Brokers Limited Zuari Commodity Trading Limited Fellow subsidiary of the Holding Company (upto June 30,2011)

6. Globex Limited

10. Zuari Financial Services Limited 11. Zuari Seeds Limited 12. Zuari Fertilisers and Chemicals Limited 1. 2. 3. 1. Zuari Maroc Phosphates Limited (ZMPL) (with effect from 27.06.2011) Paradeep Phosphates Limited (Subsidiary of Zuari Maroc Phosphates Limited) (with effect from 27.06.2011) Zuari Rotem Speciality Fertilizers Limited (with effect from 31.05.2011) Mr. S. S. Nandurdikar, Managing Director of Paradeep Phosphates Limited Mr. N. Suresh Krishnan, Managing Director Zuari Maroc Phosphates Limited, Director of Zuari Rotem Speciality Fertilisers Limited Maroc Phosphores, SA (with effect from 27.06.2011) Rotem Amfert Negev Limited (with effect from 31.05.2011) Indo Maroc Phosphore Limited (with effect from 27.06.2011) OCP , Morocco (in respect of a JV) (with effect from 27.06.2011) Zuari Industries Limited (with effect from 01.07.2011) Indian Furniture Products Limited (with effect from 01.07.2011) Simon India Limited (with effect from 01.07.2011) Zuari Management Services Limited (with effect from 01.07.2011) Adventz Infraworld India Limited (with effect from 01.07.2011) Gulbarga Cement Limited (with effect from 01.07.2011) Globex Limited (with effect from 01.07.2011) Zuari Investments Limited (with effect from 01.07.2011)

(iii) Joint ventures of the Company

(iv) Key Management Personnel of the Zuari Holdings Group

2. (v) 1. 2. 3. 1. 2. 3. 4. 5. 6. 7. 8. 9.

Other Venturers in respect of JV Entities

(vi) Party having Significant Influence

10. Zuari Insurance Brokers Limited (with effect from 01.07.2011) 11. Zuari Commodity Trading Limited (with effect from 01.07.2011) 12. Zuari Financial Services Limited (with effect from 01.07.2011)

85 F-106

The transactions with related parties are given below: Consolidated Related Party disclosures under Accounting Standard - 18 b) Following transactions were carried out with related parties in the ordinary course of business. Consolidated Related Party (` in Lacs) Sl. No Transaction details Key management personnel (KMP) 2011-12 Enterprise Having significant Influence 51.01 39.42 18.69 0.15 5.78 27.77 Fellow Subsidiaries

Joint Ventures 1 Payment made on their behalf - Zuari Maroc Phosphates Limited - Paradeep Phosphates Limited -Zuari Rotem Speciality Fertilisers Ltd - Zuari Indian Oiltanking Limited - Zuari Management Services Limited - Adventz Infraworld India Limited Payment made on our behalf -Paradeep Phosphate Limited - Zuari Industries Limited - Simon India Limited - Style Spa Furniture Limited - Adventz Infraworld India Limited - Zuari Management Services Limited Managerial remuneration - Mr. S. S. Nandurdikar Purchase of finished goods, raw material, spares, etc - Maroc Phosphores S.A. - OCP , Moracco -Zuari Rotem Speciality Fertilisers Ltd - Fertliser and Chemicals Ltd., Israil - Bunge Maroc Phosphore - Phosphates De Boucraa SA Write Off, Claims and Demmuarges - Maroc Phosphores S.A. - OCP , Moracco -Indo Maroc Phosphores S.A.Morocco - Phosphates De Boucraa SA Royalty - Rotem Amfert Nagev Ltd. Service Charges paid - Zuari Indian Oiltanking Limited - Zuari Investment Limited Interest Received

Joint Venturers

Holding Company

Total

0.94 19.44 40.45 11.56 -

1.93 3.62 -

0.94 19.44 40.45 51.01 1.93 3.62 11.56 39.42 18.69 0.15 5.78 27.77

3 4

46.14

46.14

- 28,196.59 - 23,457.69 2,177.77 89.75 - 2,744.97 - 4,603.14 36.18 77.54 0.44 2.51 40.40 -

115.32 -

0.20

28,196.59 23,457.69 2,177.77 89.75 2,744.97 4,603.14 36.18 77.54 0.44 2.51 40.40 115.32 0.20

6 7

86 F-107

ZUARI HOLDINGS LIMITED

Sl. No Transaction details Key management personnel (KMP) 2011-12 Enterprise Having significant Influence 0.30 0.55 0.35 1.77 816.40 2.29 4.99 Fellow Subsidiaries -

Joint Ventures -Zuari Rotem Speciality Fertilisers Ltd 9 Professional Fees paid - Zuari Investments Limited - Zuari Management Services Limited - Simon India Limited - Zuari Insurance Brokers Limited 10 Purchase of Fixed Assets - Simon India Limited - Stype Spa Furniture Limited - Indian Furniture Products Limited 11 Purchase of Investment - Zuari Industries Limited 12 Receipt of Inter-Corporate Deposits / Loans - Zuari Industries Limited 13 Repayment of Inter-Corporate Deposits / Loans - Zuari Industries Limited Balance Outstanding at the year end 1 2 As Debtors As Advances Recoverable - Zuari industries Limited - Paradeep Phosphates Limited - Adventz Infraworld India Limited - Maroc Phosphore SA, Morocco - Bunge Maroc Phosphore - Simon India limted 3 As Trade Payable - Zuari Rotem Speciality Fertilisers Limited - Zuari Maroc Phosphates Limited - Rotem Amfert Nagev Ltd. - Zuari Indian Oiltanking Limited - Zuari Management Services Limited - Zuari Investments Limited - Maroc Phosphore SA, Morocco - Indo Maroc Phosphore S.A. Morocco - OCP , Morocco 60.22 9.40 9.56 29.36

Joint Venturers

Holding Company -

Total

29.36 0.30 0.55 0.35 1.77 816.40 2.29 4.99 19,745.36

- 19,745.36

- 19,100.00

19,100.00

18.00

18.00

9.42 -

3,454.88 5.78 8.37 253.89

3,454.88 9.56 5.78 9.42 8.37 253.89

51.00 113.67 7.31 3,718.17

9.46 11.20 0.28 -

60.22 9.40 51.00 9.46 11.20 0.28 113.67 7.31 3,718.17

87 F-108

Sl. No

Transaction details Key management personnel (KMP) -

2011-12 Enterprise Having significant Influence 294.81 3.02 19.11 Fellow Subsidiaries -

Joint Ventures - Phosphate De Boucraa SA - Simon India Limited - Indian Furniture Products Limited - Zuari Industries Limited Corporate Guarantee - Paradeep Phosphates Limited (ZMPL) 1.19

Joint Venturers 1,781.03 -

Holding Company -

Total

1,781.03 294.81 3.02 19.11 1.19

46. Demerger a) Pursuant to the Scheme of Arrangement and Demerger (The Scheme) between Zuari Industries Ltd. and Zuari Holdings Ltd. approved by the Honble High Court of Bombay at Goa, on March 2, 2012, all the Assets, Liabilities pertaining to Fertiliser Undertaking as on 1st July, 2011 of Zuari Industries Limited have been transferred to the Company at their book values and accordingly the surplus of Assets over the Liabilities of the Fertiliser undertaking so Demerged, resulted in creation of Business Restructuring Reserve of ` 65,404.84 lacs in terms of the Order of the Honble High Court of Bombay at Goa. The said reserve be treated as free reserve and may be restricted and not utilized for declaration of dividend by the Company. The said order has been filed with the Registrar of Company on March 21, 2012.

b) The summary of the assets and liabilities transferred from Zuari Industries Limited as on July 1, 2011 is as below: Particulars Fixed Assets (Net) Current Assets , Loans and advances Less: Current Liabilities and Provisions Less: Loans and Borrowings (Secured and unsecured) Less: Deferred Tax liabilities Net Transfer Equity Share Suspense Business Restructuring Reserve Amount 21,410.02 2,35,545.04 2,56,955.07 83,938.44 1,03,143.66 1,524.06 1,88,606.16 68,348.90 2,944.06 65,404.84

(` In lacs)

c)

Pursuant to the Scheme, the Zuari Holdings Limited has since issued 29,440,604 Equity Shares of ` 10/- each aggregating to ` 2,944.06 lacs to the existing shareholders of the Zuari Industries Limited, in the ratio of 1 fully paid up Equity Share of ` 10/- each of Zuari Holdings Limited for each share of ` 10/- each held in Zuari Industries Limited. However, pending allotment at the year end, this amount is carried as Equity Share Capital Suspense. The results of the Company for the current year ended 31st March, 2012 are after giving effect to the Scheme, whereby the Fertiliser Undertaking of Zuari Industries Limited have been Demerged into the Company with appointed date of 1st July, 2011 and accordingly its previous years figures are not comparable with current year As per the Scheme, during the period between the Appointed date and the Effective date, Zuari Industries Limited deemed to have carried on the Fertiliser Undertaking in trust on behalf of the Company. Further all profit or incomes earned and losses and expenses incurred for Fertiliser Undertaking, shall for all purposes be deemed to be profits or income or expenditure or losses of the Company. The title deeds for immovable properties, licences, agreements, loan documents etc. of the Company are in the process of being transferred in the name of Zuari Holdings Limited.

d)

e)

f)

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ZUARI HOLDINGS LIMITED

47. Details of the Zuari Holdings Group in Joint Ventures included in the Consolidated Financial Statements are as follows: (` In lacs) Particulars I. EQUITY AND LIABILITIES Reserves and surplus Non-current liabilities Long term borrowings Deferred tax liabilities (Net) Other long term liabilities Long-term provisions Current liabilities Short-term borrowings Trade payables Other Current Liabilities Short-term provisions Total 56,878.21 30,284.90 7,829.20 5,020.02 1,42,809.89 312.75 72.51 64.64 219.91 42,127.75 As at March 31, 2012

II

ASSETS Non-current assets Tangible assets Intangible assets Capital work-in-progress Deferred Tax Assets Long-term loans and advances Current assets Current investments Inventories Trade receivables Cash and bank balances Short-term loans and advances Other current assets Total 80.98 34,061.50 77,602.64 350.13 2,470.85 20,879.87 1,53,255.79 12,760.35 88.51 2,734.36 1378.03 848.57

89 F-110

Particulars I INCOME Revenue from operations (gross) Less: excise duty Revenue from operations (net) Other income Total Revenue (I) II EXPENDITURE Cost of raw material and consumed Purchase of traded goods (Increase) in inventories Employee benefit expense Other expenses Total Expenditure (II) III Earnings before interest, tax, depreciation and amortization (EBITDA) (I) - (II) Depreciation and amortization expense Finance costs IV Profit before tax Tax expenses Current income tax MAT Credit Entitlement Deferred tax Income tax expenses of earlier years V VI VII VIII Total tax expense Profit After Tax Share of Minority in Profits Profit for the Year

for the year ended 31st March 2012 2,03,513.81 746.13 2,02,767.68 3,839.66 2,06,607.34 1,05,135.06 72,586.81 (11,228.81) 2,799.37 20,960.60 1,90,253.03 16,354.31 968.08 3,086.94 12,299.29 4,148.30 (6.16) (195.75) 0.58 3,946.97 8,352.32 (1,618.43) 6,733.89

48. Disclosure as per Section 22 of The Micro, Small and Medium Enterprises Development Act, 2006. (` in lacs) S.No. i) Particulars The principal amount and the interest due thereon remaining unpaid to any supplier: - Principal amount - Interest thereon ii) the amount of interest paid by the buyer in terms of section 18, along with the amounts of the payment made to the supplier beyond the appointed day. Nil 0.24 Nil 2011-12

90 F-111

ZUARI HOLDINGS LIMITED

S.No. iii) Particulars the amount of interest due and payable for the year of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified under this Act the amount of interest accrued and remaining unpaid the amount of further interest remaining due and payable even in the succeeding years, until such date when the interest dues above are actually paid to the small investor 2011-12

Nil

iv) v)

0.24

Nil

49. In respect of Parent Company and subsidiary of a joint venture, department of fertilizer, Government of India has issued an office memorandum dated 11th July, 2011 whereby subsidy rates applicable on closing stock of Finished Goods and Raw Materials as on 31st March, 2011 have been revised to subsidy rates applicable of Financial Year 2010-11 as per Nutrient Based Subsidy Policy. Accordingly the Company has adjusted its subsidy income by ` 951.83 lacs (` 477.64 lacs being proportionate share of Zuari Holdings Group in respect of subsidiary of a joint venture) to give impact of above mopping up adjustment. 50. During the year there was a fire incident on the cross country petroleum pipeline owned by Terminalling service providers. Arising from this, the pipeline had to be closed down on security and consequently repairs and recertification needs. Due to consequent safety related issues, the Mormugao Port Trust authorities had also stopped clearance of other raw materials for Phosphatic and Potassic Fertilisers. These events caused disruption of 63 days in Urea Production and 20 days in Phosphatic and Potassic Fertilisers production. The pipeline was subsequently repaired, recertified and re-commissioned on 19th, October 2011 and clearance from Mormugao Port Trust authorities for berthing of vessel was received on 1st October, 2011. Operations currently are normal. 51. Figures pertaining to the subsidiaries and joint venture companies have been reclassified wherever considered necessary to bring them in line with the Companys financial statements. Figures reported with respect to the joint ventures and their subsidiaries represent the Companys proportionate share only. 52. Since, the consolidation of financial for the Parent company is done for the first time, previous period figures are not applicable.
As per our report of even date For and on behalf of the Board of Directors of Zuari Holdings Limited

For S. R. BATLIBOI & CO. Firms Regn. No.: 301003E Chartered Accountants

S. K. Poddar Chairman

N. Suresh Krishnan Managing Director R. Y. Patil Chief General Manager & Company Secretary

Marco Wadia Director

Per Anil Gupta Binayak Datta Partner CFO & Vice President Finance Membership No. : 87921 Place : Gurgaon Date : 9th May, 2012 Place : Gurgaon Date : 9th May, 2012

91 F-112

AUDITORS' REPORT TO THE MEMBERS OF ZUARI HOLDINGS LIMITED

1. We have audited the attached Balance Sheet of Zuari Holdings Limited as at 31st March 2011, the Profit & Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted the audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditors Report) Order, 2003 (as amended), issued by the Department of Company Affairs, Government of India in terms of Section 227 (4A) of the Companies Act, 1956, we give a statement on the matters specified in paragraphs 4 and 5 of the said Order to the extent applicable on the basis of such checks as we considered appropriate and according to the information and explanations given to us: a) Based on the audit procedures performed and representations obtained from the management, we report that no fraud on or by the Company has been noticed or reported during the audit (clause xxi). In our opinion, the requirement of clauses (i) to (xx) specified in paragraph-4 of the said Order are either not applicable or do not call for a statement for the period under audit.

(ii)

In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books.

(iii) The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account. (iv) In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956, to the extent applicable. (v) On the basis of the written representations received from the directors and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March 2011 from being appointed as a director in terms of section 274(1)(g) of the Companies Act, 1956.

2.

3.

(vi) In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India; a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March 2011; In the case of the Profit & Loss Account, of the loss for the year ended on that date; and In the case of the Cash Flow Statement, of the cash flows for the year ended on that date. For V. Sankar Aiyar & Co. Chartered Accountants Firms Regn. No. 109208W Place : New Delhi Dated : 09-05-2011 (V. Rethinam) Partner Membership No. 10412

b)

c)

b)

4. Further to our comments in the annexure referred to in paragraph 3 above, we report that: (i) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit.

2 F-113

ZUARI HOLDINGS LIMITED

BALANCE SHEET AS AT 31ST MARCH, 2011
Sch (Amount in Rs.) As at March 31, 2011 (Amount in Rs.) As at March 31, 2010

I.

SOURCES OF FUNDS :
Shareholders' Funds Share Capital 1 2,00,00,000 2,00,00,000 1,97,36,070 1,97,36,070 33,090 33,090 1,97,02,980 2,97,020 2,00,00,000 5,00,000 5,00,000 5,09,300 5,09,300 2,77,983 2,77,983 2,31,317 2,68,683 5,00,000

1 2

Loan Funds TOTAL

II.

APPLICATION OF FUNDS :
1 Fixed Assets Current Assets, Loans & Advances Cash & Bank Balances Current Liabilities & Provisions Current Liabilities 2

2 3

4 Net Current Assets Miscellaneous Expenditure Profit & Loss Account TOTAL Accounting Policies & Notes on accounts : 5

The schedules referred to above and the notes on Accounts form an integral part of the Balance Sheet

As per our report of even date attached For V. SANKAR AIYAR & CO. Chartered Accountants For and on behalf of the Board

V. Rethinam Partner Memebership No. 10412 Place : New Delhi Dated : 09-05-2011

Suresh Krishnan Director Place : Gurgaon Dated : 09-05-2011

Binayak Datta Director

3 F-114

PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2011
Sch (Amount in Rs.) As at March 31, 2011 18,740 18,740 (Amount in Rs.) As at March 31, 2010

I.

INCOME
Interest Income Total

II.

EXPENDITURE
Audit Fees Miscellaneous Expenses 4 Total 33,090 13,987 47,077 (28,337) (28,337) (2,68,683) (2,97,020) (0.01) 10 19,303 2,49,380 2,68,683 (2,68,683) (2,68,683) (2,68,683) (5.37) 10

Profit / (Loss) before Tax Less : Provision for Tax Profit / (Loss) after Tax Balance brought forward from previous year Balance carried to Balance Sheet Basic and Diluted Earning Per Share (In Rs.) Nominal Value of Shares (In Rs.) Accounting Policies & Notes on accounts :

The schedules referred to above and the notes on Accounts form an integral part of the Profit & Loss account

As per our report of even date attached For V. SANKAR AIYAR & CO. Chartered Accountants For and on behalf of the Board

V. Rethinam Partner Memebership No. 10412 Place : New Delhi Dated : 09-05-2011

Suresh Krishnan Director Place : Gurgaon Dated : 09-05-2011

Binayak Datta Director

4 F-115

ZUARI HOLDINGS LIMITED

CASH FLOW STATEMENT FOR THE PERIOD ENDED MARCH 31,2011
(Amount in Rs.) As at March 31, 2011 (28.337) (28.337) 1,80,00,000 (2,44,893) (1,82,44,893) (1,82,44,893) (1,82,73,230) (Amount in Rs.) As at March 31, 2010 (2,68,683) (2,68,683) 2,77,983 9,300 9,300 9,300

A. CASH FLOW FROM OPERATING ACTIVITIES :

Net Profit / (Loss) before tax & exceptional items. Adiustment for : Depreciation Operating ProfiU(Loss) before working Capital Charges Adiustment for changes in : (lncrease)lDecrease in Current Assets (Fixed Deposit - 180 days) (Decrease)llncrease in Current Liabilities and Provisions Cash ftow before extra ordinary items Cash Generated from operations Less Income tax and prior year taxes paid Net cash from operating activities

B.

CASH FLOW FROM INVESTING ACTIVITIES :

Purchase of Fixed Assets Proceeds from Borrowings Net cash used in Investing activities (B)

1,95,00,000 1,95,00,000 12,26,770 5,09,300 17,36,070 12,26,770

5,00,000 5,00,000 5,09,300 5,09,300 5,09,300

C.

CASH FLOW FROM FINANCING ACTIVITIES

Issue of Share Capital (Met of balance due) Net cash used in financing activities Net Changes In Cash and cash equivalents during the year Cash and Cash equivalents at the beginning of the year Cash and Cash equivalents at the end of the year Net Increasel(0ecrease)

As per our report of even date attached For V. SANKAR AIYAR & CO. Chartered Accountants V. Rethinam Partner Memebership No. 10412 Place : New Delhi Dated : 09-05-2011 For and on behalf of the Board

Suresh Krishnan Director Place : Gurgaon Dated : 09-05-2011

Binayak Datta Director

5 F-116

SCHEDULES ANNEXED TO AND FORMING PART OF THE BALANCE SHEET (Amount in Rs.) As at March 31, 2011 (Amount in Rs.) As at March 31, 2010

Schedule 1 : Share Capital

Authorised : 20,00,000 Equity shares of Rs.10/- each Issued and Subscribed : 20,00,000 Equity Shares of Rs.10/- each Less : Due from Subscriber to the Memorandum of Association Amount Paid Up (The above shares are held by Zuari Industries Limited, the holding company and its nominees, since 10th March, 2011 previously held by Zuari Investments Limited) 2,00,00,000 2,00,00,000 2,00,00,000 1,95,00,000 5,00,000 2,00,00,000 2,00,00,000 2,00,00,000 2,00,00,000

2,00,00,000 14,76,070 1,80,00,000 2,60,000 1,97,36,070 29,781 3,309 33,090 1,249 8,273 280 100 4,085 13,987

5,00,000 5,09,300 5,09,300 19,303 10,510 2,48,170 2,77,983 700 2,48,170 510 2,49,380

Schedule 2: Cash and Bank Balances

In Scheduled Banks - Current Accounts On Deposit account Stamps in Hand

Schedule 3 : Current Liabilities

Audit Fees payable TDS Payable Sundry Creditors Zuari Industries Limited - Ultimate Holding Company Zuari Investments Limited - Holding Company

Schedule 4 : Other Expenses

Printing & Stationery Professional Fees ETDS Filing Fees Bank Charges Incorporation expenses RoC filing fees

6 F-117

ZUARI HOLDINGS LIMITED

31.03.2011 5. ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE YEAR ENDED A. ACCOUNTING POLICIES i)

Basis for preparation of accounts

These financial statements have been prepared to comply in all material respects with the notified Accounting Standards by Companies (Accounting Standards) Rules, 2006 and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention and on accrual basis.

ii)

Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent liabilities at the date of the financial statements and the results of operations during the reporting period end. Although these estimates are based upon managements best knowledge of current events and actions, actual results could differ from these estimates. Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured. Basic Earnings per Share is calculated by dividing the net profit or loss for the year attributable to the equity shareholders (after deducting attributable taxes) by the weighted average number of equity shares outstanding during the year. For the purpose of calculating diluted earnings per share, net profit or loss for the year attributable to equity shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive Potential Equity Shares.

iii) Revenue Recognition

iv) Earnings per Share

B.
1.

NOTES ON ACCOUNTS
Basic and diluted earnings per share as per Accounting Standard 20 Particulars Loss for the period Weighted average number of equity shares Face value of per share Basic and diluted earnings per share Period ended March 31, 2011 28,337 13,60,479 10 (0.01) Period ended March 31, 2010 2,68,683 50,000 10 (5.37)

Sr. No. a) b) c) d) 2.

Related party disclosures under Accounting Standard 18 a) List of related parties as identified by the management: i. ii. Zuari Industries Limited - Holding Company since March 10, 2011 (where Control exists) Zuari Investments Limited - Holding Company (till March 09, 2011)

7 F-118

b)

Transactions carried out with related parties in the ordinary course of business : 31.03.2011 i ii iii Reimbursement of expenses incurred by Holding Company (Zuari Investments Ltd) Reimbursement of expenses incurred by Ultimate Holding Company (Zuari Industries Ltd with effect from 10-03-2011) Share Capital subscribed by Holding Company 4085 2,0000,000 31.03.2010 2,58,680

c)
1.

Balance Outstanding at the year end :

Balance outstanding payable Zuari Industries Limited (Holding Company) Zuari Investments Limited 31.03.2011 31.03.2010 10,510 2,48,170

2.

Balance due from Zuari Investments Limited towards share Capital 1,95,00,000

As per our report of even date. For V. SANKAR AIYAR & COMPANY Chartered Accountants For and on behalf of Board of Directors

V. Rethinam Partner Memebership No. 10412 Place : New Delhi Dated : 09-05-2011

Suresh Krishnan Director Place : Gurgaon Dated : 09-05-2011

Binayak Datta Director

8 F-119

ZUARI HOLDINGS LIMITED

Balance Sheet Abstract and Companys General Business Profile I. Registration Details Registration No. Balance Sheet Date U 3 6 1 5 0 9 3 1 2 0 0 G 1 A 1 2 0 0 9 P L C 0 State 0 6 2 1 4 7 7

II. Capital raised during the year (Amount in Rs. Thousands) Public Issue Bonus Issue Rights Issue Private Placement

III. Position of Mobilisation and Deployment of funds (Amount in Rs. Thousands) Sources of Funds Total Liabilities 2 Paidup Capital 2 0 Secured loans Application of Funds Net Fixed Assets Net Current Assets 1 9 7 Accumulated Losses 2 0 9 2 7 0 0 0 0 0 0 0 Total Assets 2 0 0 0 0 Reserves & Surplus Unsecured Loans Investments Misc. Expenditure

IV. Performance of Company (Amount in Rs. Thousands) Turnover Total Expenditure 4 7 + Profit/Loss Before Tax + Profit/Loss After Tax 4 2 8 4 2 (please tick Appropriate box +for Profit, for loss) Earning Per Share in Rs. Dividend @ % 0 . 0 1 V. Generic Names of Three Principal Products/Services of the Company (as per Monetary terms) Item Code No. (ITC Code) Product Description

9 F-120

10 F-121

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F-123

F-124

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F-130

F-131

XIV: MANAGEMENTS DISCUSSIONS AND ANALYSIS Overview The business of the Company comprises of the Demerged Undertaking that was transferred to it by Zuari Industries Ltd. pursuant to the Scheme of Demerger, which became effective from 21st March 2012. The Company has been engaged in manufacturing facilities in India and the registered office of the Company is at Jai Kisaan Bhawan, Zuarinagar Goa, and its fertilizer plant is situated at Goa, the plant has divisions like NPK A, NPK B, Urea Plant and so on. It is having regional offices at Karnataka, Maharashtra, Andhra Pradesh, Madhya Pradesh, Gujarat, Rajasthan, Kerala, Tamil Nadu, and the branch/sales offices located across the country in Pune, Kolhapur, Aurangabad, Amravati, Bangalore, Hubli, Bellary, Vijayawada, Hyderabad, Kurnool, Indoor, Ahmadabad, Jaipur, Thiruvananthapuram, Coimbatore. The Company is also having its corporate office in Delhi. The Company is engaged in business of Manufacturing of fertilizers like urea, and other Complex fertilizers of various grades like 18:46:0, 10:26:26, 12:32:16, and 20:20:0. The Company manufactures specialty fertilizers, seeds, chemicals through its joint venture and subsidiaries. Zuari Fertilisers & Chemicals Limited (ZFCL)., a wholly owned subsidiary of the company is in process of setting up a 600 TPD unit at Mahad in Maharashtra for manufacture of Single Super Phosphate (SSP) ZFCLs unit is likely to be commissioned in 2013-14 Effective from the Appointed Date to the Effective Date, during the period of reporting, the operations of the Company were run for and on its behalf by Zuari Industries Ltd. on trust. Macro- Economic Outlook In a bid to bridge the widening demand-supply gap and reduce dependence on imports, Government of India has taken several steps aiming to create investor-friendly environment and enhance indigenous capacities in urea. A Group of Ministers (GoM), headed by the then Finance Minister Pranab Mukherjee, have approved a new investment policy for the urea sector. Policy seeks to give urea manufacturers a minimum 12% post-tax return on capital. The policy, on getting formal approval of Union Cabinet is expected to spur new urea capacities. Your company will take final decision on proposed Greenfield urea project once the policy gets cabinet nod. Government of Indias recent announcements in budget 2012 to give full exemption to imported equipment for urea projects, abolition of customs duty on coal, no issuance of fertilizer bonds towards fertiliser subsidy payments etc. will also have positive impact on growth of fertilizer Industry.

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Consequent upon passing of bill on food security, requirement of food grains for the country will rise substantially in coming years. The Government of India is gearing up to achieve 4.1% growth in agriculture during twelfth five year plan period. In 2012-13 budget, outlay for agriculture has been increased by 18% to Rs 20,108 crores. The credit target has been raised to Rs 5,75,000 crore and the interest subvention schemes for farmers are continuing. Allocation for irrigation schemes has been raised by 13% to Rs14,242 crores. Special sops have been provided to encourage agricultural research and extension, aiming speedy transfer of technology to farmers fields. With stronger support to agriculture sector and thrust on mechanization, there will be consistent rise in demand for fertilizers in the country. Our Companys Strengths Company has consolidated its market presence by expanding its marketing activities in the new markets of Madhya Pradesh and Gujarat. A new regional Office has been opened up at Indore to oversee marketing operations in these states. With over two hundred thirty Jai kisaan Krishi Salahkars in marketing territory and direct linkage with sixty thousand farmers, company is equipped with a strong army for effective implementation of market development programmes in the field. Besides strengthening the brand equity of Jai kisaan products, this programme helps in getting regular feed-back from farmers, thus facilitating timely corrections in market related decisions. Opening of new Agriculture Development laboratory at Tirupati has given further boost to companys crop health services to customers. This laboratory caters to the companys emerging markets of Madhya Pradesh, Gujarat, Andhra Pradesh, Tamil Nadu and Kerala. The new laboratory is armed with state-of-the-art technology to provide soil analytical services for major and micronutrients. The soil test reports are now available to farmers on line, thus saving time in delivery of reports. With strong network of dealers, full-scale logistic operations through ports on east and west coast, complete range of agricultural inputs in the product basket, and host of crop health services for farmers, the company is now recognized as provider of full-fledged farming solutions to farming community in the marketing territory. Recent Developments In December 2011, Zuari Global Limited, in joint venture with Mitsubishi Corporation, acquired a 30% stake in Peruvian rock phosphate mine. This investment will be transferred by Zuari Global Limited to the Company. With implementation of Nutrient Based Subsidy (NBS), companys complex fertilizer segment is expected to benefit due to margin expansion and lower subsidy receivables. The company targets to increase its current 2 mn MT sale to over 3.5 mn MT over the next three years. With host of capital investments over next 3-4 years, led by 1 mn MT NPK plant to be commissioned by FY 2015, debottlenecking of Goa plant from 0.7 mn MT to 1 mn MT by 2013, expansion of Paradeeps capacity from 1.2 mn MT to 1.5 mn MT and investment in proposed

118

1 mn MT Greenfield Urea project, the company foresees bright returns on its investments in coming years. Marketing Efforts For ease of marketing operations, the company has segmented its marketing area into Primary and Emerging market. Primary market covers the states of Goa, Karnataka and Maharashtra states, while Emerging market comprises of Andhra Pradesh, Tamilnadu, Kerala, Madhya Pradesh and Gujarat. Country as whole received rainfall from southwest monsoon in June Sept 2012 which was less by 8% than the 50 year average In your companys marketing territory, Karnataka and Maharashtra received severely deficit rainfall from southwest monsoon during June-September 2012. Demand for fertilizers took a severe beating in kharif season, on account of deficit rainfall, coupled with steep hike in market prices of NPK complexes. Analysis of Key Business Risks a. Dependency on the Monsoons Indian agriculture is largely dependent on monsoon. Any aberrations in monsoon can prove to be a dampener in demand for fertilizers. This can result in piling up of stocks and large scale competition amongst fertilizer marketers leading to erosion of margins. b. Dependency on Imports of Raw Materials To meet demand supply gap, the company will continue to depend on imports of DAP, MOP and complexes. Any unfounded hike in global prices of fertilizers and delay to signing price agreements with international suppliers can result in non-availability of products in peak season, thus impacting the sales of the company. c. New Investment Policy for Urea The exisiting investment policy for new investments in Urea sector announced by the Government in 2008 has not been able to invite fresh investments owing to several reasons. Based on interactions with various stakeholders the government is planning to come up with a new investment policy which may partly address the concerns raised by the stakeholders. Significant Developments since 31st December, 2011 The Scheme of Demerger became effective on 21st March 2012. Post the effectiveness of Scheme of Demerger, the Company had taken over the Fertilizer Undertaking from Zuari Industries Ltd. Following the Effective Date, the Company has applied for transfer of licenses like Excise registration, Service tax registration and Factory license etc.). All relevant orders taken under the legal entity Zuari Industries Ltd for the Fertilizer Undertaking are being changed/need to be changed to Zuari Agro Chemicals Limited.

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XV. OUTSTANDING LITIGATIONS, DEFAULTS AND MATERIAL DEVELOPMENTS Zuari Industries Limited/Zuari Agro Chemicals Limited Pursuant to the clause 13 of the Scheme of Arrangement and Demerger, all legal and other proceedings by or against Zuari Industries Limited and relating to the Fertiliser Undertaking shall be continued and enforced by or against Zuari Holdings Limited only. If proceedings are taken against Zuari Industries Limited, Zuari Industries Limited will defend on notice as per advice of Zuari Holdings Limited at the costs of Zuari Holdings Limited and Zuari Holdings Limited will indemnify and keep indemnified Zuari Industries Limited from and against all liabilities, obligations, actions, claims, and demands in respect thereof. Litigationsfiledby/againsttheCompany SR.NO. NAMEOFTHECOURTAND ADVOCATE 543/2008&544/03JMFC Bellary

PARTIESINVOLVED ADABellaryVsZIL representedbyMr. Bakale&R.V.Kossambe ADA,AlandGovt.of KarnatakaV/s.Maidargi AgroAgencies,ZIL& ThungabadraFert.& ChemicalsLtd ADARaichurV/s R.V.Kossambe

BRIEF SUMMARYOF THECASE Substandard Sampurna

STATUS Petitionfiledfordischargeof accusedjudgementpending. Casepending HCallowedthedischargeofTFCL accused. Thematterwasremandedback tothelowercourtfordeciding upontheremainingissues. Nextdateis23/11/2012

Sp.CaseNo.1/98Principal SessionJudge(Special Court)AlandGulbarga

Substandard SingleSuper Phosphate

C.C.245/11atJ.M.F.C. Lingasugur

Substandard 12:32:16

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ADAAland(Govt.of Karnataka)V/s.M/s. KisanAgroAgencies, AlandM/s.ZIL,M/s. TungabhadraFert.& ChemicalsLtd. HCallowedthedischargeofTFCL accused. Thematterwasremandedback tothelowercourtfordeciding upontheremainingissues.

SpecialCaseNo.65/2000 InTheCourtofthe PrincipalSessionJudge GulbargaAland

Substandard SingleSuper Phosphate.

CC3/2001CourtofDistrict &SessionsJudge, Davangere

ADAHarpanahalliV/s. M/s.VantechChemicals, Saibaba,ZIL,M/s.Patel Traders,Harpanahalli

Substandard ZincSulphate

Argumentscompleted. Judgementawaited.

StayobtainedfromHighCourt Bangalore. Subsequentlyfileistransferredto DharwarHighCourt.Caseisyet tocomeupforhearing CasewaspendinginHC.Now remandedbacktolowercourt Aland.

CaseNo.190/2003 PrincipalCivilJudge(Jr. Division)&JMFCHospet

ADAHospetV/sM/s InamuriTraders, Mariammanahali,ZIL

Substandard Samarth

CaseNo.1073/2007at JMFCAland

ADAAlandVsZIL&Bhavi AgroAgencies.

SubStandard Sampurna

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8 9 C.C.No.498/11atJMFC Hiriyur C.C.No.760/11&761/11 J.M.F.C.Hospet ADAHiriyurv/sZIL, DealerMr.Gupta&RMO Bellary ADAHospetV/sDealer SubStandard Sampurna SubStdDAP& 10:26:26 Caseispending.Nextdateis 27/11/2012 Caseispending.Nextdateis 20/10/2012 FiledVakalatnamaat HighCourt,CircuitBench, Gulbargarequestingfor transferringcasefromAland CourttoHighCourt.Nextdate awaited. Nextdateawaited.

10

CaseNo.28/03atJMFC Aland

ADAAlandVsZIL&Bhavi AgroAgencies.

SubStandard Sampurna

11

1344/04dt.18/11/04Jr. DivisionJMFCKolar CC942/02Dt.12/06/2002 JMFCRamnagaram Bangalore

FertiliserInspectorcum Agri.OfficerKollarV/s C.S.Shetty,ZIL FertiliserInspectorcum Agri.OfficerRamnagarm BangaloreV/sAbdul Jabbar,ZILM/sPSV Enterprises

Substandard Sampurna

12

Substandard Sampurna

Nextdateofhearingnotfixedas oneaccusedhasexpired.

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FertiliserInspectorcum Agri.OfficerBangalore V/sZIL&M/sMysore FertiliserCo.Bangalore. FertiliserInspectorcum Agri.OfficerBangalore V/sZIL,Mr.Ramchandra ReddyM/s VenkateshwaraFertilisers FertiliserInspectorcum Agri.Officer SrirangpatanamV/sP. Manju(dealer),Mr. LaxamanTFCL,ZIL ADAPawagadaV/sM/s manjunathEnerprises NewBusstandPavagad& ZIL

13

32184/05Dt.19122005 Principal&SessionsJudge Banglore

Substandard Samrat

Mr.H.V.Subramanya,Bangalore. Judgementisreserved.

14

CC83/06Addl.Judicial JMFCAnekalBangalore Dist.

SubStandard Sampurna

Nextdateofhearingisawaited.

15

CC56/2003,JMFC SrirangpatanamMysore Dist.

Substandard SingleSuper Phosphate

Casepending

C.C.No.33/07JMFC Pavagad,Pavagad,Tumkur Dist.

Substandard D.A.P.

16

Nextdateofhearingisawaited.

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FertiliserInspector KortgereDistFert. InspectorTurvkereVs Mr.AnandDealer,Mr. P.N.Joshi&Mr.Sharat BabuV/s.ZIL FertiliserInspectorKollar V/s.ZIL ADAHalagurV/s.ZIL ADASIRAV/s.ZIL ADABangarpetVsZil repre.ByMr.S.K.Joshi& others

17

CaseNo.350/04JMFC KortgereDistTumkur

SubStandard Sampurna

FertiliserInspectorhasgonein appeal.Nextdateawaited.

18 19 20 21

858/04,JMFCKolar CC540/03JMFCMalavalli Mandya CC452/08atJMFCSIRA, Bangalore. CCNo.88/08atJMFC BangarpetBangalore

SubStandard Sampurna SubStandard Sampurna Substandard 10:26:26 Substandard DAP

Nextdateofhearingisawaited. Casepending. Casepending. Casepending.

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DOAMr.SureshH.G.Dist. QualityOfficerV/s Ghargaon V.K.S.Society,KastiV.K.S. Society,ZIL,LPL. StateV/sSurvanshi&co. Vadilibhoi,LPL&ZIL StateV/sLPLKamalesh ZilYousufOMSales, PramodVasu A.O.sindkhedaVsLPL &ZIL AgriculturalDept.V/s. ShaneshwarKSK, Pathardi,Ahmednagar Substandard singlesuper phosphate Substandard singlesuper phosphate Substandard singlesuper phosphate Substandard singlesuper phosphate Substandard singlesuper phosphate

22

Rt44/2001Dt.23/03/2006 JMFCShirgonda

Casepending.

23

CJMChandnwad04/2003 Nasik

Casepending.

24

Cr.Case.No.SSC43/2003 CJMParol,Jalgaon

Caseispendingforwantof service.Nextdateawaited.

25 26

CaseNo.105/2005JMFC Sindkheda SuitNo.&Court24/2001, Ahmednagar

Nextdateisawaited Casepending

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27 28 29 30 13of2002beforeJMFC, Pali JMFCNandgaoNasik 127/2008 JMFCDindoriNasik 154/2008 JMFCPhaltanC.C.No. 382/10newNo.125/11 DeptofAgricultureV/s. ZILDMORaigad,Pali Mr.KasarFert. InspectorVsLPL,ZIL FertiliserInspector DindoriV/s1.ZilandSix others ADAPhaltanv/s1.Liberty 2.ZIL&3.Dealer StateFertiserInspector KHEDV/sSubbaraoZIL& others(P.Sundara Raman) StatateofMaharashtra AgriOfficerN.T.RaneV/s. ZIL,LibertyPhosphates& LanjaTalukaskvsLtd. Substandard Sampurna Substandard singlesuper phosphate Substandard singlesuper phosphate Substandard singlesuper phosphate Substandard Sampurna Substandard singlesuper phosphate Casepending Casepending Casepending Casepending

31

CCNo.385/05JMFCKhed

Casepending

32

CaseNo.23/08dt. 08/01/2010atJMFCLanja

Casepending

126

33

11/98877/983/6/98 (STC/877/2000)/21/8/97 S.P.JudgeDistrictCourt Solapur

DistrictInspectorQuality ControlAgriDept., Solapur,v/sJagganathB. Mehtre,YousufMohiddin LibertyPhosphate Mumbai,Mr.ArunWalunj Dist.InspectorQuality ControlAgriDept.Govt.of MaharashtraV/sZuari IndustriesLtd,accused no.2.LaxmiK.Kendra, MahudMr.C.B.Tate AgriculturalDept.v/s. V.M.GandhiTuljapur Road,Osmanabad

Substandard SSP

Mr.U.MGoreQualityControl Inspectorhasexpired.Freshdate awaited.

9/9820/6/98Newcase no.399/2000atSangoala S.P.Judge,Dist.Court, Solapur,transferredto JMFCSangolaNewNo 136/00 SP/2652,Osmanabad

34

Substandard Urea

Nextdateofhearingis712 2102.AccusedMr.Saolapurkar hasexpired.

35

substandard Singlesuper Phosphate

Freshdateawaited

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DistrictQualityControl Inspector,Seeds Fertilisers& Pesticides,Officeofthe Dist.Sup.Agriculture OfficerSangliv/sa) GanapatiZillaKass SocietyLtd.Sanglib)M.T. Gaikwad,Regional Manager,ZIL,Kolhapur Mr.S.D.Vaidya,Dist. QualityControl,Inspector &Fertiliser Inspector,Agricultural Office,ZillaParishad Sangliv/sM/sRaj Fertilisers,MalgaonMr. BabuRaoJinmappa Vasagade,Sangli (Prop.RajFertilisers)M/s BalaKalappaKudche, JaysingpurMr.Bala KalappaKudche, JaysingpurZuariAgro ChemicalsLtd.Goa, Dy.Genl.Manager (Marketing)

36

406/2001Judicial MagistrateSangli

Substandard Sampurna

Nextdateofhearingis 7/12/2012.

37

93/9521/4/1995) 399/2001SpecialJudge, Miraj

Substandard Samrat

Dr.SaolapurkarexDGMMKTG RMOPunehasexpired.Since accusedhasexpiredthecaseis likelytobeclosed

128


RCCNo.374/03Dt.904 2003Kolhapur,CivilJudge Jr.Div&Judicial Magistrate,Solapur. CCNo.1400/2007filed beforetheJudicial MagistrateFirstClass, MadhaDistrictsolapur, Kolhapur CaseNo.253/08JMFC ShiralaSangliKolhapur Region. StatethroughSridhar JoshiVsZILArchanaK. Bh.IranaPanche StatethroughFertilizer InspectorcumAgriculture OfficerV.ZIL Govt.Maharastrarepres. ByShriM.B.kadam ShiralaVsZIL

38

Substandard Sampurna

Nextdateofhearingisawaited

Substandard Sampurna Substandard 10:26:26

39

Nextdateofhearingisawaited

40

Casepending

41

Cr.Caseno.323/2004 Addl.JMFCTirupathi

StateofA.P.V/sZILH.S. Eshwarappa&TFCL

SubstandardSSP

Casepending

CC337/2006NelloreII AdditionalJudicial MagistrateIstClassNellore

AssistantDirectorof AgricultureNellore.V/s SriPokuriMalakondiah, &ZIL

Substandard Sampurna

StaygrantedbytheHighCourt. Nextdateawaited.

42

129


AssistantDirectorof AgricultureNandyalVs M/sMateshwariFerts& PestsandZIL

43

CCNo.488/05JMFC NandyalShifedtoJMFC Karnool

Substandard Saubhagya 14:35:14 Analysed productisnotas perthe specifications. Zincpercentage substandard

nextdateawaited.

44

CC.NO232/2002,JMFC ,Kurnool

ADAV/sZIL,Kurnool

Postedforargument.Freshdate awaited.

CasehasbeenshiftedtoDistrict Court.Freshdateisawaited.No informationfromthecourtw.r.t. futureproceedings. Caseispending

45

CCNo.81/2002,Distr. CourtKarnool.

ADAV/sZIL,Kurnool& ThungabadraFerts& Chemicals

Substandard SSP.

46

CC874/2006Addl.Judl. MagistrateKrimnagar

Asst.Directorof AgricultureKarimnagarVs Zil

Substandard SingleSuper phosphate

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RCCNo.12/2004NewNo. 24/2004JMFC,Nilanga Court(dist.Latur) RCC208/2004AtAUSA Dist.Latur 105/2005JMFCSindkheda JMFCNndgaon127/2008 FertiliserInspectorV/s LPL,Mr.YusufMohiddin &ZIL,M/sSanjayKSK, Nilanga) ADAAurangbadDist. LaturV/sLPL,Zil&Bharat KrishiBahandar AOSindkhedaMr.U.P. Birase,LPLZIL Mr.Kasar,fertiliser InspectorVsZIL&LPL ADARamdurgV/s.V.S. Cholachagud Ramdurg(subdealer)V.B. Gangannavar, Ramdurg(dealer)ZIL, Zuarinagar,Mr.Abdul MatheenTFCLHospet Substandard SingleSuper phosphate Substandard SingleSuper phosphate Substandard SingleSuper Phosphate Substandard SingleSuper Phosphate

47

Caseispending

48 49 50

Mr.YoussufMohiddinis dischargedfromthecasevide orderdated19112007.Caseis pending Caseispending Caseispending

51

Specialcaseno34/2000 Sp.CourtBelgaum 76/2003.*SessionCourt Ramdurga

Substandard SingleSuper Phosphate

ProceedingsfiledbeforeHigh CourtofDharwadforquashing thecasehavebeenallowed.

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ADAByadgiV/sM/s HaleshKrishi Kendra,MottebennurM/s TFCLMr.Abdul Mateen,ZIL ADAFert.Inspector, ShriggaonV/s.Mr.S.K. Kinekar,PratibhaKrishi SevaKendra,2.CMTSCL, Zuarinagar,3.Mr.Abdul Matheen Prdn.Mgr.TFCL,Hospet ADAByadgiV/S.Halesh KrishiKendra, MotebennurdealerTFCL HospetBHNagaraja MM,Hubli ADAShirhattiV/sM/s. BasaveshwaraTraders, BellattiMr.S.B.Mahadik erstwhileMMHubliM/s. TFCLMunirabad Substandard SingleSuper Phosphate

52

CaseNo.376/2000JMFC Byadgi

M/sTFCLhavegonetoHigh Court.Nextdateisawaited

53

Spl.CaseNo.705/2002, SpecialJudgeBelgaum*

Substandard SingleSuper Phosphate

M/sTFCLhavegonetoHigh Court.Nextdateisawaited.

CaseNo.376/02Sessions Court,DharwarCaseNo. changedtoSplEC9/2001 CaseNo.395/02Spl. ECC/7/2001District SessionsJudgeCourt GadagshiftedtoJMFC Laxmeshwar

Substandard SingleSuper Phosphate Substandard SingleSuper Phosphate

M/sTFCLhavegonetoHigh Court.andobtainedthestay. .ZuarihasnottakenpartinHigh courtproceedings.

54

55

Caseispending

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AgricultureOfficer,JDA OfficeDharwad.V/s1.r. ShashdharaC.Patilof M/sBaswaswaraAgro Agencies,Hubli.2.ZIL 1)Asst.Directorof Agriculture,HukkeriV/s 1)MrDundappa.I. Bagewadi&2)ZIL AgricultureOfficer S.B.KulloliV/s1.Anand Fertilisers&2.ZIL ADASankeshwarV/s Dealer&ZIL M/sPratibhaKrishiSeva Kendra,ZuariDealer, Belgaum.;Mr.SAMahant Shetty,subdealer Ballihongal; ZILComplianceOfficer

56

CaseNo.1071/09JMFC Hubli

Substandard DAP

Caseispending

57

CaseNo.839/10atJ.M.F.C. Sankeshwar

Substandard Samarth

Caseispending

C.C.No.1025/10JMFC Banahatti C.c.No.505/11J.M.F.C. Sankeshwar

Substandard DAP SubStandard ImportedDAP Substandard 10:26:26 Samarth

58

Caseispending

59

Caseispending

60

C.C.No.565/11

Caseispending

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61 JVSRaoVsADA(assistant DirectorofAgriculture Mr.SK.Joshiand Mr.S.S.Rao. RaoVsADA 289/06,DistrictCourtEluru (AssistantDirectorof Agriculture) 215/05JMFCGuntur Substandard 14:35:14 Substandard 14:35:15 Judgementhascomeinfavourof company;finalorderisyettobe received. Judgementhascomeinfavourof company;finalorderisyettobe received.

62

63

Spl.C.S.No.57/99/BInthe CourtofCivilJudge,Sr.Div. VascodaGama

ZILV/s.SaibabaManures DepotDealerCode 70187

Forrecoveryof Rs.2.54lakhsfor suppliesmade.

AppealedintheHighCourtafter beingdismissedbyVascoCourt. NowtransferredbacktoDistrict Court,Margaoonpecuniary Jurisdictionlimit. Judgementdeliveredinfavourof theCompany.Execution proceedingsarebeinginitiated.

OS80/04dated 28/07/2004CivilJudgerSr. Div.MaddurDist.Mandya

ZilV/sMr.MadhsettyKN Smt.PremaMadhshetty.

RecoveryofO/s 9,96,344/

64

134


TheJudgementisreceivedin favouroftheCompany..Thecourt hasdirectedthedealertopay Rs.637454(includinginterest) Theexecutionofthedecreeis beingtakenup.

65

C/Suitno.166/02 dt.10/10/01,Civil Judge,Sr.Divn.Barshi

ZILV/sJ.B.Gude

Recoveryclaim ofRs.4,41,176/ plusinterest

UnderCC No.196/98Court convictedthe dealerfor1year imprisonment. Theparty appealedinthe HighCourtand gotacquitted.

66

AppealNo.75/2002Dist Court,Kurnool

NewRachamaduguV/s.ZILGurunathamand SonsNandyalIIIrdAddlDistJudge,Nandyal

Appliedforcertifiedcopy.

67

CS34/2002Sub Court,PenugondaKurnool

ZILV/s.SudhaAgriculturalAgencies,Garladinne

CivilSuitfiledfor recoveryof outstandingsof Rs.2,97,000/

Expartedecreeisinourfavour. Outofcourtsettlementis worked

135

68

CC727/2004

ZilV/sShriSatyanarayanagenciesKaddappa

Cheque bouncingcase Rs.2,60,000

Partynottraceable.

Appealagainst OrderofDistrict Collector confiscatingDAP stock

69

AppealNo.180/2010 Appealfiledbeforethe DistrictandSessionscourt Anantpur

ZILV.MandalAgriculturalOfficer

Highcourtwaspleasedtoallow theapplicationforreleaseofthe DAPstockagainsttheCompany issuingBankGuarantee.

70

Darkhast30/95inSpl.Civil SuitNo.12/82Dist.Court Aurangabad.

ZILV/s.Kailash&Co.

Forrecoveryof Rs.1.35,000/.

TheProprietorofthefirmhas expired.Caseispending

SpecialSuitNo.9/2004 dated30/7/04JMFCLatur CJSDUdgirDist.Latur

Recoverysuitfor Rs.7,04,000/

72

ZILV/sUdaykrishiSevakendraUdgirDist.Latur

Caseispending

136

73

Specialcivilsuitno. 10/2004dated30/07/04 JMFCLatur. Criminalcaseno.3210/05 CJMJALGAON OS/1/99Tadeppalligudem Court

ZILV/sM/SRamlingeshwarShaktiBhandarDist, Latur.

Recoverysuitof Rs.13,21,000/ Undersection 138ofN.I.ACT Recoveryofdues Rs.1,49,948.00

Caseispending

74

ZILV/sR.G.Lohar

DecreedinCompany'sfavour.

Dealerhasagreedforoutof courtsettlementbypayingsome amountduringtheseason. Effortsareon.

75

ZILV/sNewJaikisanFertilisers

76

CC97/04,98/04&354/04, 355/04JMFCKhammam

PPLV/sSrivalliCorporationrepresentedbythe proprietorKhammam.

Recoverydues

Nextdateawaited.

RecoveryofRs. 4,20,480/

DecreeinfavouroftheCompany .Defendantfiledappealinthe HighCourtatHyderbad.Awaiting notice.

77

ZilOS2/98

ZILVsM/sSriVijayalakshamiAgrocentre

137

PPLOS/192&194/2006dt. 040906.Anjaneyuulu ChowdaryAddl.Sr.Civil JudgeCourtNarasaraopet 513/2005JMFCKaimnagar Hydrabad.Vakalatfiledon 17/05/2007 Judgementpronouncedsuit decreedinfavourofthe Recoverydues Company.Executionproceedings arebeinginitiated. Recoveryof outstanding amountingRs. 1,42,757/ Courthasissuedsummons. Dealernottraceable.Case pendingforserviceofsummons todealer

78

ZILV/sM/sSubramanyshwaraFertilisers, Narasaraopet

79

ZILVsM/sNagendraFertilisers&Pesticides

80

IntheHighCourtof BombayatGoa

ZILV/s.BasiliaGomes

Appealhasbeen filedagainst claimforZILland Suitfor declarationand other consequential reliefsinthe matterofalleged claimforland

MattertocomeuponBoardof theHighCourt

81

IntheCourtofCivilJudge, Sr.Div.atVascoda Gama.Spl.CivilSuitNo. 20/01/B

ZILVsPeopleofSancoale

Caseispending

138

82

Suitfordeclatory reliefswrt IntheCourtofAddl.Civil Mrs.FranciscoD,CostaERodrigues&OthersV/s propertybearing JudgeSr.Div.VascoDa LiopolidinhoAguiar,ZIL&Others surveyNo.128/3 GamaGoa.SuitNo.40/06/B ofSancoale Village Reg.CSNo.54/93/CInthe CourtofCivilJudgeJunior Div.,VascodaGama. Suitfor declaratory reliefs Prosecutionfiled againstCompany ontheaccidental deathofcontract worker

Caseispending

83

ZACLV/s.T.Mohankumar

Caseispending

84

BeforetheHighCourtof BombayatGoa

ZACLV.FertilizerInspector

Appealfiled.

139

85

SuitNo.1503/98, June,1998.)LPANo.95 /2008IntheHighCourt NewDelhi

SouthernPetrochemicalInd.Corp.Ltd.,&ZIL& Othersthru'FAIV/sGovt.

Disputein reductionof subsidyinthe concession extendedwith retrospective effect

AppealisfiledbytheUnionof IndiabeforetheSupremeCourt.

Appealagainst the order/judgment dated14thJune 2005passedby RailwayRates TribunalofIndia.

86

IntheHighCourtof Bombay,atGoa.Writ petitionNo.370of2005.

ZuariIndustriesLimitedV/sUnionofIndia throughGeneralManagerSouthWestern Railways

Companyhasdepositedan amountofRs.2crores,inthe HighCourt.MatterisonBoard forfinalhearing.

87

CivilWritPetitionNo.231of 2007.IntheHighCourtof JudicatureBombayatGoa Panaji.(ZilLandacquisition)

ZIL&othersVsStateofGoa&others

Prayertodeclare Notification dated5th, February(r/w corrigendumdt. 19thFeb.2007) Writpettionadmitted.(Status and19th,April quoordercontinues). 2007for acquisitionof Companyland asbadinlaw illegal,nulland void

140


RaikarV.ZIL.Matterbefore theConsumerDispute RedressalForumMargao Mr.SureshRaikarVs InsuranceCompany&Zil Insuranceclaim againstFire& OrientalInsurance Company Suitforclaimagiants shortloadofDAPat KandlaPort. Recoveryclaimof 500.868MTtothe tuneofUSD 263,775.52(approx Rs.1.30crores) Suitfor compensationof Rs.66crorestowards claimsarisingoutof fireincidentdated 1920thAugust2011

88

Nextdateofhearingawaited.

89

IntheHighCourtof BombayAdmiraltySuit No.402of2011

ZILV.M.V.Olympias

Respondentshaveissuedabankguaranteeof amountprayedforalongwith9%interestperanum tilldisposalofSuit.Thematterispending.

BeforetheCivilJudge SeniorDivision,atVasco

90

ZACLV/sNHAIand5ors

CasefiledbyZACL.

141

142


Litigationsfiledby/againstDirectorsoftheCompany

Sr. No.

Name of the Director Arun Duggal

Case No

Case title

Relevant section with Act if available. SpecificPerformance underSaleContract

Court of Jurisdiction, Place

Liability/ Receivable Quantified

Present status

Shyam Bhartia

CivilSuit40 Mr.ArunDuggal, of2006 Plaintiff Versus Mr.AjayPratapSingh &UdayPratapSingh, Defendant 311/2005 Atul Kakkar Vs Jubilant Organosys Limited, Mr. Shyam S. Bhartia

HonbleHighCourtof HimachalPradeshat Shimla

PendingTrial

Judicial Agra

Magistrate

at

The Complainant alleged that Jubilant Organosys Limited had fraudulently transferred 50 shares owned by him in favour of Ms. Varsha Maheshwari which were actually stolen from his possession.Criminalliability

Jubilant Organosysfiled a petition U/S 482 Cr.PCbearing No. 13019/2005) before the High Court at Allahabad for quashing of the proceedings. The High Court of Allahabad has stayed the proceedings of the criminal case before the Judicial Magistrate at Agra. The matter is currently pending.

143


3 Shyam Bhartia 280A/ 19.7.05 State through Chief Section 19(a) of agriculture Officer, Fertiliser Control Muktsar Order and Section 7 read with Section 12 AA of essential Vs Commodities Act M/S Kamal and Company and others. Chief Judicial Magistrate at Giddarbaha (Dist. Muktsar, Punjab) Criminalliability The Supreme Court of India stayed the proceedings before the Chief Judicial Magistrate, Muktsar on November 27, 2008 in SLP 8493/2008 converted to Cri. Appeal No 1497/2010. Further, by order dated December 8, 2008, the Supreme Court of India confirmed the stay of further proceedings only against Mr. Shyam S. Bhartia, till further order. The special leave petition is currently pending. The Matter will come for hearing on November 27, 2012

Akshay Poddar

C.R.R. No. 323 of 2011

Adventz Investments and Holdings Ltd. & Others. Versus Birla Corporation Ltd. & Another

Application under High Court at Calcutta Revisional Section 482 of the Criminal Code of Criminal Jurisdiction Procedure, 1973

144


5 Akshay Poddar C/ 30907/2010 Birla Corporation Ltd. Versus Poddar Heritage Investments Ltd. & Others Petition of Complaint under Section 200 of the Code of Criminal Procedure, 1973 for offences punishable under Sections 379, 403, 411 read with Section 120B of the Indian Penal Code, 1860 Before the Learned Metropolitan Magistrate, 10th Court, Kolkata The next hearing is scheduled on December 10,2012

145


Litigationsfiledby/againstthePromoterCompany ZuariGlobalLimited(FormerlyknownasZuariIndustriesLimited) SR.NO. NAMEOFTHE COURTAND ADVOCATE PARTIESINVOLVED

BRIEF SUMMARYOF THECASE

STATUS

D.P.Bhad,InsecticideInspector&Dist. QualityControlInspectorADO 492/94dated6.9.94 Z.P.Raigad, JMFCMangaonDist, V/s.V.M.Dhamdhere,KonkanPesticides, Raigad. A.V.Mahalunkar,ZILS.G.Sheth,Konkan MSK,Mangaon InsecticideInspector,ADO, Z.P.Ahmednagar, V/s.(1)K.Saibaba,VantechChemicals Ltd.(2)A.V.Mahalunkar,ZIL(3)Bharat Vikhe,ShramikKrishiSevaKendra, Narayangaon

Substandard Polycron

AwaitingJudgement

329/98SuitinJudicial Magistrate1stClass JMFCJunnar

Substandard Mancozeb

Caseispending

146


Mr.S.B.GangaiFertilizerInspector, ZillaParishadSindhudurgV.Vantech Chemicals,M/s.ZuariIndustriesLtd. andM/s.AnnapoornaK.S.K. Sawantwadi

CaseNo.303/2010

Substandard Chloripyrifos

Nextdateofhearingison 12122012

CaseNo.113/2001 CJMsolapurState Adv.Deshpande

FertilserinspectorV/sNewUtkarshK.B Mandrup,Zil

Substandard Endosan

Noticehasbeenissuedto AOPSto attendthecase.

STC.2050/2006 JMFCMadhaSolapur

ADOSolapurV.D.SrikantRao, MrunaliniEnterpricesandZIL

Substandard Monosaan

Caseispending

147

CCNo.107/2002 YemmiganurCourt Adv.Nagendranath Reddy,Kurnool ShiftedtoDistrict CourtKarnool.

ADAV/sZIL,Kurnool

Substandard Pesticide

Caseispending

332/2009,3rd Metropolitan Megistrate cyberabad, Hyderabad PesticidesC&F, Misappropriation undersection403 &406` Otheraccusednot appearingHenceCourt hasissuedfresh summons.

P.Narhari

Caseispending

SCCNO1339/95 Sillod(Dist.A'bad) court

InsecticideInspectorv/sZIL,&Konkan Pesticides,M/sPiyushAgroAgencies, SillodDist.Aurangabad&ors.

Substandard Endosulfan

148

CaseNo.3097/2005 Addl.JMFC Bhadravati

ADACumInsecticedsInspector BadravatiVsMr.RameshHaldamma tradersDist.Shimoga,.ZILShimoga

Substandard Monosaan

Caseispending

10

IntheHighcourtof BombayatGoa Executionof Judgementpassedin LandAcquisition Casefiledbeforethe DistrictCourt(Adv. Sonak/Devidas Pangam)

SancoaleCommunidadeV/sZIL

Suitfordeclaratory reliefagasinstZIL Courthasawarded enhanced compensationof Rs.116/persq.m. Executionofthe decreehasbeing initiated.

Appealfiledagainstorder oftheLowercourt. Pendinghearing

11

ZILV/SGovernmentofGoa.

Casepending

12

IntheCourtof DistrictConsumer M/s.Premavatiw/o.Mr.OmPrakash RedressalForum, Singhal,Bulandshahr203001U.P.V/s. Bulandshahr,U.P.Adv. ZIL. SatendraSingh Raghav

Claimfor7 additionalshares ofRightsIssue

Appealfiledbeforethe StateCommissionat Lucknow,againstthe OrderoftheConsumer Forumandobtainedstay.

149

13

IntheIndustrial Tribunal,Panjim

RobertFalcaoV/sZil(GrevalEng.)

Reinstatementof GrewalEngg. Workmen

Orderhascomeinfavour oftheCompany.Partyhas challengedtheorderof thetrialCout.Casesent backtoDistrictCourt.Next dateisawaited. Judgementpassedagainst theCompanyon2808 2012.Companyhas initiatedstepsforappeal beforetheHighCourt.

14

BeforetheDistrict Judge,atMargao

RGFurtadoV.ZIL

Appealagainst OrderoftheLower courtforrecovery ofmoneypayable byRGFurtadoto theCompany SawPipesLtd.have filedsuitagainst HaryanaStateand madeallallottees ofHUDAlandin Gurgaonas partners. Reinstatmentof serviceswithall consequential benefits.

15

CWPNo.12649of 1995intheHigh Courtof Chadigarh,Chandigarh

UnionofIndia(Dept.ofFertilisers& Dept.ofAgriulture.SawPipesLtd., V/s.StateofHaryana&Others

Casepending

148/2004dated 9/12/2004

Casehasbenshiftedto additionalMetropolitan Magistrate,Nampally.

16

ZILV/sK.RamchandraRao

150


SuitforTemporary Injunctionto restrainthe cmpanyfrom transferringthe SharadaAshokHajareV/sSandhya FDRwithinterest AshokHajare&ZuariIndustriesLtd& accruedthereon, others ason30/10/1998 amouningRs. 47,261tothe Investors Educationand ProtectionFund. Suitforrecveryof amountofRs. 1,26,935.54 deductedfromthe salaryofthe plaintiffwitha S.S.RaoV/sV.VenkteshwaraRao&Zil furtherclaimof interest@24% fromthedateof suit.aginsttheIst, defendantin alternativeagainst theCompany.

17

INTHECOURTOF CIVILJUDGESENIOR DIVISIONATVASCO DAGAMASPL.CIVIL SUITNO58/05/A

Casepending

18

INTHECOURTOFSR. CIVILJUDGEGUNTUR *174/2005O/S 309/2004

Casepending

151


Challengingtheorderdated 1st,June2006passedby IncomeTaxappellateTribunal MumbaiBench'E'InI.T.A.No 71and75of2005for asessmentyear20012002. AmountinvolvedRs.17.41 crores.

19

TaxAppealNo.491of2006

ZILVsAsstCommissioner ofIncomeTaxCicle2 MargaoGoa.

Mattertocomeupfor hearingonHighcourtBoard.

MatterisshiftedtoBombay HighCourtinpursuanceto theorderofBombayHigh CourtandclubedwithTax appealNo.491of2006. Mattertocomeupfor hearingonHighcourtBoard. Mattertocomeupfor hearingonHighcourtBoard. Mattertocomeupfor hearingonHighcourtBoard.

20

TaxAppealNo.80of2006

CommissionerofIncome TaxVsZIL

TribunalMumbaiBench'E'In I.T.A.No71and75of2005for asessmentyear20012002.

CommissionerofIncome Taxv/s.ZIL CommissionerofIncome Taxv/s.ZIL

Taxeffectintheappealis valuedat0.36crores. Taxeffectintheappealis valuedatRs.0.44crores.

21

TaxAppealNo.60of2008

22

TaxAppealNo.51of2008

152

23

(casenotassignedyet) CommissionerofIncomTax (appeals)Panaji TaxAppealNo.18of2009

Dy.Commissionerof IncomeTaxV.ZIL

TaxeffectinappealisRs.0.21 crores (Assesmentyear20062007) Taxeffectintheappealis valuedat0.38crores. Appealagainsttheorderofthe Commissioner(Appeals)dated 15032012fortaxeffect amountingtoRs.3,36,847/for assesmentperiodApril2009to September2009 1 Appealagainsttheorderofthe Commissioner(Appeals)dated 15032012fortaxeffect amountingtoRs.5,91,486/for assesmentperiodOctober 2009toMarch2010

Matteraddmittedon2909 2011.Officialposition vacant. Mattertocomeupfor hearingonHighcourtBoard. Companyhasdepositedthe amountunderprotest. Appealheardon19062012 andstaywasgranted againstpredepositof Interestandpenalty.

24

CommissionerofIncome Taxv/s.ZIL

25

TaxAppealNo.ST/400/2012

ZILV.CESTAT

26

TaxAppealNo.ST/70/2012

ZILV.CESTAT

Companyhasdepositedthe amountunderprotest. Appealheardon23072012 andstaywasgranted againstpredepositof Interestandpenalty.

153

AppealNo.ST/263/22Mum andStayno.ST/Stay/730/11 MUMCommissionerof CentralExcise VishakapatanamII 27 Commissionerate Viahakhapatanam Consultant/CounselMr.A. Vijaykumarret.I.R..S.

CustomsExise&service TaxAppellatetribunal WestzonalBranchV.ZIL

CaseagainstZilforalleged misuseofNotificationNos. 17/2001dt.132001and 21/2002Cusdated132002as ammendedinrespectof importofmuriateofPotash.

Nextdateawaited.

Judgementdelivered upholdingthedemandof theDepartmentinrespect ofuseoffurnaceoilusedfor generationofpowerused foradm.Building&colony. Asfarasdemandtowards theuseoffurnaceoilfor Argonplantsameis remandedbacktothe department. 50%ofthedisputedamount ofpenaltyhadsbeenpaid (Rs.21,28,125)andad interimstayisgrantedfor 50%ofthedisputedamount ofpenaltyagainst irrevocablebankguarantee.

28

CESTATofGoaAppealNo. E/78of2003&AppealN.o E/2879/2003

CommissionerofCentral exiseV.ZIL

RecoveryofinterestofRs.0.30 croresinfurnaceoilusagecase

29

JCCT(Appeals)BCD1, Bangalore

JointCommissionerof CommercoialTaxes, BanglaoreV.ZIL

Levyofpenaltyfor proffessionaltaxongodowns (20022003)

154


ApexCourtordersarein favourofGovt.ofKarnataka. PrincipalP.T.settledforyear 200304to200809.Interest paidaspercourtorder @1.25from20052006to 20082009 Contingentliability Rs.19,97,994/.Amount paidRs.12,39,917/. Appealpreferredagainst theorderandstaygranted subjectto50%depositof thedisputedamount.

29

HighCoutBangaloreof KarnatakaatBangalore.

Dy.Commissionerof CommercialTaxes, BangaloreV/sZuari IndustriesLimited

Levyofprofessionaltaxon godowns@Rs.0.10crores

IntheHighCourtofA.P. againsttheorderofAsst. Commissioner(CT) Intelligence,Punjagutta Division

Asst.Commissioner(CT) Intelligencepassedanorder raisingdemandtopay Rs.16,79,835/on29thJune, 1999onsaleofpesticides.

30

ZuariIndustrieslimitedv/s. Asst.Commissioner(CT) Intelligence

2 Decisioninfavourofthe company.Departmentof IncomeTaxhasgoneinto appealbeforetheSupreme Court.Yettoreceivethe appealpapers. ClaimfiledintheHighCourt forinclusionofFformsand askingforrevisedAssesent Ordertoavoidpenalty.

31 HighCourtofBombayatGoa

CommissionerofIncome TaxV.ZIL

TaxeffectRs.0.69 crores(Assesmentyear2001 2002)

CommercialTaxOfficer, HyderabadV.ZIL,Regional Office

DemandofRs.0.16croresfor assesmentProceedingsfor 20072008.

32

HighCourtofAndhra PradeshatHyderabad.

155


Matterhasbeentagged withTaxAppeal No.51/2008.Threeissues havebeendismissedand oneissuesurviveswhichhas decresedtheTaxeffectfrom 1.17croresto0.31crores. Matterhasbeentagged withTaxAppeal No.51/2008.Threeissues havebeendismissedand oneissuesurviveswhichhas decresedtheTaxeffectfrom 13.6croresto0.36crores. Matterhasbeentagged withTaxAppeal No.51/2008.Threeissues havebeendismissedand oneissuesurviveswhichhas decreasedtheTaxeffect from1.91croresto0.40 crores. Matterheardon09042012 andsubmissionsmadeon 19102012 Matterheardon19102012

33

HighCourtofBombayat Goa.TaxAppealNo.34/2012

CommissionerofIncome TaxV.ZIL

DemandofRs.0.31crores pertainingtoAssesmentyear 19981999

34

HighCourtofBombayat Goa.TaxAppealNo.26/2012

CommissionerofIncome TaxV.ZIL

DemandofRs.0.36crores pertainingtoAssesmentyear 19992000

35

HighCourtofBombayat Goa.TaxAppeal29/2012

CommissionerofIncome TaxV.ZIL

DemandofRs.0.40crores pertainingtoAssesmentyear 20002001

36 37

ITA/555/MRG/11 ITA/556/MRG/11

CITappealsV.ZIL CITappealsV.ZIL

Demandfor2.05crore, pertainingtoAssesmentyear 20092010 Demandfor0.25crore, pertainingtoAssesmentyear 20082009

Litigationfiledby/againstPromoterGroupCompanies:

156

 ADVENTZINVESTMENTSANDHOLDINGSLIMITED (PreviouslyknownasPoddarHeritageInvestmentsLimited) DETAILSOFMATTERPENDINGINCOURTS Sl. CaseNo. CauseTitle No. LEGALCASESFILEDBYUS 1 C/18526/2010

Section&Statute underwhichfiled

Court& Jurisdiction

Status

PoddarHeritageInvestments Ltd Versus ChopraMarketingP.Ltd&Anr.

G.A.No383of2011 C.S.No.174of2010

C/12087/2011

PoddarHeritageInvestments Ltd Versus ChopraMarketingP.Ltd& Anrs AdventzInvestments& HoldingsLtd Versus EnsoPvtLtd.&Others

138readwith Section141of Negotiable InstrumentsAct, 1881

IntheCourtof Chief Metropolitan Magistrateat Calcutta IntheHigh Courtat Calcutta

Amount involved Rs.2.89 cr. and further interest till payment. The matter is being heard from time to time and next date of hearingisfixedon21stMay,2012.

The matter is being heard from time to time.

138readwith Section141of Negotiable InstrumentsAct, 1881

IntheCourtof Chief Metropolitan Magistrateat Calcutta

Amount involved Rs.9.41 cr with further interest till payment. The matter is being heard from time to time and the next date ofhearingon18thMay,2012forplea.

157

 4 C.R.R.No.323of2011 AdventzInvestmentsand HoldingsLtd.&Others. Versus BirlaCorporationLtd.& Another Petitioner No. 1: Adventz Investments And Holdings Limited (previously known as Poddar Heritage Investments Limited) Petitioner No. 4: Fullford VinimayPrivateLimited Petitioner No. 5: Adventz SecuritiesEnterprisesLimited (previously known as Poddar HeritageCorp.Limited) PetitionerNo.7:AkshayPoddar Applicationunder Section482ofthe CodeofCriminal Procedure,1973 IntheHigh Courtat Calcutta Criminal Revisional Jurisdiction The Petition is posted for further hearing on27November2012.

158

 LEGALCASESFILEDONUS Sl. No. 1 CaseNo. A.C.O.No.42of2011 A.P.O.T.No.150of2011 A.P.O.No.154of2011 C.P.No.1of2010 CauseTitle BirlaEducationTrust&Others Versus BirlaCorporationLtd.&Others Appellant/ Petitioner No. 2: Fullford Vinimay Private Limited Appellant/ Petitioner No. 4: Adventz Investments And Holdings Limited (formerly known as Poddar Heritage InvestmentsLimited) Appellant/ Petitioner No. 5: Adventz Securities Enterprises Limited (formerly known as Poddar Heritage Corp.Limited) Section&Statute underwhichfiled AppealunderSection 10Fofthe CompaniesAct,1956 arisingfromanorder oftheCompanyLaw Board,Principal Bench,NewDelhi Court& Jurisdiction IntheHigh Courtat Calcutta CivilAppellate Jurisdiction Status

The Appeal is being heard from time to time.

A.C.O.No.71of2011 A.P.O.T.No.281of2011 A.P.O.No.of2011 C.P.No.1of2010

BirlaCorporationLtd. AppealunderSection Versus 10Fofthe BirlaEducationTrust&Others CompaniesAct,1956 arisingfromanorder Respondent No. 2: Full Ford oftheCompanyLaw Board,Principal VinimayPrivateLimited

IntheHigh Courtat Calcutta CivilAppellate Jurisdiction

The Appeal is pending and shall be fixed for hearing post conclusion of the appeal beingA.C.O.No.42of2011.

159

 Bench,NewDelhi Respondent No. 4: Poddar HeritageInvestmentsLimited Respondent No. 5: Poddar HeritageCorp.Limited BirlaEducationTrust&Others AppealunderSection 10Fofthe Versus BirlaCorporationLtd.&Others CompaniesAct,1956 arisingfromanorder Appellant/ Petitioner No. 2: oftheCompanyLaw Board,Principal Fullford Vinimay Private Bench,NewDelhi Limited (now known as Adventz Securities Trading Pvt.Limited) Appellant/ Petitioner No. 4: Limited (now known as Adventz Investments and HoldingsLimited) Appellant/ Petitioner No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) BirlaEducationTrust&Others Petitionunder Sections235,237, Versus BirlaCorporationLtd.&Others 247,250,397,398, Petitioner No. 2: Full Ford 402and403ofthe

A.C.O.No.189of2012 A.P.O.T.No.411of2012 A.P.O.No.of2012 C.P.No.1of2010

IntheHigh Courtat Calcutta CivilAppellate Jurisdiction

The Appeal shall come up for hearing on 3 December2012.

C.P.No.1of2010

CompanyLaw Board, Principal Bench,New

The Company Petition is posted for final hearingon21,22and23January2013.

160

 Vinimay Private Limited (now CompaniesAct,1956 known as Adventz Securities TradingPvt.Limited) Petitioner No. 4: Poddar Heritage Investments Limited (now known as Adventz Investments and Holdings Limited) Petitioner No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) BirlaEducationTrust&Others Applicationunder Versus Regulation44ofthe BirlaCorporationLtd.&Others CompanyLawBoard Regulations,1991 Petitioner/ Applicant No. 2: Full Ford Vinimay Private ByPetitioners Limited (now known as Adventz Securities Trading Pvt.Limited) Petitioner/ Applicant No. 4: Poddar Heritage Investments Limited (now known as Adventz Investments and HoldingsLimited) Petitioner/ Applicant No. 5: Delhi.

4A

C.A.No.332of2011 in C.P.No.1of2010

CompanyLaw Board, Principal Bench,New Delhi.

The application is posted for hearing on 21, 22 and 23 January 2013 along with the main Company Petition [C.P. No. 1 of 2010].

161

 Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) BirlaEducationTrust&Others Versus BirlaCorporationLtd.&Others Petitioner No. 2: Full Ford Vinimay Private Limited (now known as Adventz Securities TradingPvt.Limited) Petitioner No. 4: Poddar Heritage Investments Limited (now known as Adventz Investments and Holdings Limited) Petitioner No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited)

4B

C.A.No.338of2011 in C.P.No.1of2010

Applicationunder Regulation44ofthe CompanyLawBoard Regulations,1991 readwithSection 403ofthe CompaniesAct,1956 ByRespondentNo.1 i.e.BirlaCorporation Ltd.

CompanyLaw Board, Principal Bench,New Delhi.

The application is posted for hearing on 21, 22 and 23 January 2013 along with the main Company Petition [C.P. No. 1 of 2010].

C/30907/2010

BirlaCorporationLtd. Versus PoddarHeritageInvestments Ltd.&Others.

PetitionofComplaint underSection200of theCodeofCriminal Procedure,1973for

Beforethe Learned Metropolitan Magistrate,

The Complaint is posted for evidence beforechargeon10December,2012.

162

 Accused No. 1: Poddar HeritageInvestmentsLtd. Accused No. 4: Full Ford VinimayPvt.Ltd. Accused No. 5: Poddar HeritageCorp.Ltd. Accused No. 7: Akshay Poddar ChopraMarketingPLtd&Anr Versus PoddarheritageInvestments Ltd offencespunishable underSections379, 403,411readwith Section120Bofthe IndianPenalCode, 1860 10thCourt, Kolkata

A.P.O.T.No.167of2011 C.S.No.174of2010

IntheHigh Courtat Calcutta

The matter is being heard from time to time.

INCOMETAXMATTERS NIL NIL NIL NIL

163

 ADVENTZSECURITIESENTERPRISESLIMITED (PreviouslyknownasPoddarHeritageCorp.Limited) Sl. CaseNo. CauseTitle No. LEGALCASESFILEDBYUS 1 C.R.R.No.323of2011

Section&Statute underwhichfiled

Court& Jurisdiction

Status

AdventzInvestmentsand HoldingsLtd.&Others. Versus BirlaCorporationLtd.& Another Petitioner No. 1: Adventz Investments And Holdings Limited (previously known as Poddar Heritage Investments Limited) Petitioner No. 4: Fullford VinimayPrivateLimited Petitioner No. 5: Adventz SecuritiesEnterprisesLimited (previously known as Poddar HeritageCorp.Limited) Petitioner No. 7: Akshay Poddar

Applicationunder Section482ofthe CodeofCriminal Procedure,1973

IntheHigh Courtat Calcutta Criminal Revisional Jurisdiction

The Petition is posted for further hearing on27November2012

164

 2 TSNo.15486of2011 AdventzSecuritiesEnterprises Ltd. Versus WestBengalStateWarehousing Corporation AdventzSecuritiesEnterprises Ltd. Versus WestBengalStateWarehousing Corporation Applicationunder section106of TransferofProperty Act IntheCourtof Ld.8thCivil Judge(Sr.Div.) atAlipore The Petition is posted for further hearing on 29 November 2012 for exparte hearing. IntheCourtof The Petition is posted for hearing on 18th Ld.8thCivil December2012forframingofissue. Judge(Sr.Div.) atAlipore Pendingfordisposal IntheHigh Courtat Calcutta

TSNo.15489of2011

Applicationunder section106of TransferofProperty Act

CONo.1543of2012

CivilRevisional AdventzSecuritiesEnterprises JurisdictionAppellate Ltd. Versus Board of Trustees of the Port of Kolkata

165

 LEGALCASESFILEDONUS Sl. No. 1 CaseNo. A.C.O.No.42of2011 A.P.O.T.No.150of2011 A.P.O.No.154of2011 C.P.No.1of2010 CauseTitle BirlaEducationTrust&Others Versus BirlaCorporationLtd.&Others Appellant/ Petitioner No. 2: Fullford Vinimay Private Limited Appellant/ Petitioner No. 4: Adventz Investments And Holdings Limited (formerly known as Poddar Heritage InvestmentsLimited) Appellant/PetitionerNo.5: AdventzSecuritiesEnterprises Limited(formerlyknownas PoddarHeritageCorp.Limited) Section&Statute underwhichfiled AppealunderSection 10Fofthe CompaniesAct,1956 arisingfromanorder oftheCompanyLaw Board,Principal Bench,NewDelhi Court& Jurisdiction IntheHigh Courtat Calcutta CivilAppellate Jurisdiction Status

The Appeal is being heard from time to time.

A.C.O.No.71of2011 A.P.O.T.No.281of2011 A.P.O.No.of2011 C.P.No.1of2010

AppealunderSection BirlaCorporationLtd. 10Fofthe Versus BirlaEducationTrust&Others CompaniesAct,1956 Respondent No. 2: Full Ford arisingfromanorder oftheCompanyLaw VinimayPrivateLimited Board,Principal Respondent No. 4: Poddar

IntheHigh Courtat Calcutta CivilAppellate Jurisdiction

The Appeal is pending and shall be fixed for hearing post conclusion of the appeal beingA.C.O.No.42of2011

166

 Bench,NewDelhi HeritageInvestmentsLimited Respondent No. 5: Poddar Heritage Corp. Limited (Now Adventz Securities EnterprisesLtd. BirlaEducationTrust&Others AppealunderSection 10Fofthe Versus BirlaCorporationLtd.&Others CompaniesAct,1956 arisingfromanorder Petitioner No. 2: Full Ford oftheCompanyLaw Board,Principal Vinimay Private Limited (now Bench,NewDelhi known as Adventz Securities TradingPvt.Limited) Petitioner No. 4: Poddar Heritage Investments Limited (now known as Adventz Investments and Holdings Limited) Petitioner No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) Applicationunder BirlaEducationTrust&Others Regulation44ofthe Versus BirlaCorporationLtd.&Others CompanyLawBoard Regulations,1991

A.C.O.No.189of2012 A.P.O.T.No.411of2012 A.P.O.No.of2012 C.P.No.1of2010

IntheHigh Courtat Calcutta CivilAppellate Jurisdiction

The Appeal shall come up for hearing on 3 December2012.

4A

C.A.No.332of2011 in C.P.No.1of2010

CompanyLaw Board, Principal Bench,New

The application is posted for hearing on 21, 22 and 23 January 2013 along with the main Company Petition [C.P. No. 1 of 2010].

167

 Petitioner/ Applicant No. 2: Full Ford Vinimay Private ByPetitioners Limited (now known as Adventz Securities Trading Pvt.Limited) Petitioner/ Applicant No. 4: Poddar Heritage Investments Limited (now known as Adventz Investments and HoldingsLimited) Petitioner/ Applicant No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) BirlaEducationTrust&Others Applicationunder Versus Regulation44ofthe BirlaCorporationLtd.&Others CompanyLawBoard Regulations,1991 Petitioner No. 2: Full Ford readwithSection Vinimay Private Limited (now 403ofthe known as Adventz Securities CompaniesAct,1956 TradingPvt.Limited) Petitioner No. 4: Poddar Heritage Investments Limited By Respondent No.1 (now known as Adventz Investments and Holdings i.e.BirlaCorporation Ltd. Limited) Delhi.

4B

C.A.No.338of2011 in C.P.No.1of2010

CompanyLaw Board, Principal Bench,New Delhi.

The application is posted for hearing on 21, 22 and 23 January 2013 along with the main Company Petition [C.P. No. 1 of 2010].

168

 Petitioner No. 5: Poddar Heritage Corp. Limited (now known as Adventz Securities EnterprisesLimited) 5. M.S.No.687of1993 R.K.P.SteelLtd. Versus PrecisionPaperIndustriesLtd. (Now:AdventzSecurities EnterprisesLtd. 6. 1092of2010 BoardofTrusteesforthePort ofKolkata Versus EstateBadriPrasadPoddar Section151ofCode ofCivilProcedure The hearing fixed on 19 November 2012 forexpartehearing. Pendingfordisposal. NB: By virtue of scheme of demerger/merger, godown situated at Alifnagar have been transferred and vested from Estate Badri Prasad Poddar to AdventzSecuritiesEnterprisesLtd. Beforethe Pendingfordisposal. LearnedEstate NB: By virtue of scheme of Officer,Kolkata demerger/merger, godown situated at PortTrust Paharpur have been transferred and vested from Poddar Estates Ltd. to AdventzSecuritiesEnterprisesLtd. Beforethe Learned3rd Bench,City CivilCourtat Kolkata Beforethe LearnedEstate Officer,Kolkata PortTrust

7.

1056of2010

BoardofTrusteesforthePort ofKolkata Versus PoddarEstatesLimited

169

INCOMETAXMATTERS DescriptionofSuits/Show causenoticeetc. NoticeUnderSection 148/143(2)forAsst.Year 20052006 Rectificationfiledunder section154oftheincome taxActforAsst.Year 20072008 AppealNo.102/1011for Asst.Year20082009 AppealFiledforAsst.Year 20092010on30/01/2012 Rectificationfiledunder section154oftheincome taxActforAsst.Year 20102011 Rectificationfiledunder section154oftheincome taxActforAsst.Year 20112012 Noticedated24/09/2012 undersection143(2)is receivedforAsst.Year 20112012 ClaimAmount (inRs.) Court/Forun/CaseNo. CurrentStatus

18,767/

Asst.Commissioner IncomeTaxCircle 14(1)NewDelhi Asst.Commissioner IncomeTaxCircle 14(1)NewDelhi CIT(A)XVIII CIT(A)XVIII Asst.Commissioner IncomeTaxCircle 14(1)NewDelhi

Noticereceivedbythecompanyon24/09/2012andrepliedbythe company Orderawaited

7,58,712/ 19,77,044/ DemandbyIT 1,54,030/ Refundclaimbyus 2,05,480/ DemandbyIT61,480/ Refundclaimbyus 1,23,960/

HearingCompleted Orderawaited AppealFiled Hearingyettobedone Orderawaited

Asst.Commissioner IncomeTaxCircle 14(1)NewDelhi

Orderawaited Hearingyettobedone

170

ADVENTZINVESTMENTCOMPANYPRIVATELIMITED CaseNo. CauseTitle Section& Sl. Statute No. under whichfiled 138read Academiam 1 C/12086/2011 withSection SalesP.Ltd 141of Versus Negotiable Paradise InfrastructuresP Instruments Act,1881 Ltd&Anr.

Court& Jurisdiction

Status

IntheCourtof Chief Metropolitan Magistrateat Calcutta

Amount involved Rs.3.18 cr. and further interest till payment. The matter is being heard from time to time and next date of hearing on 31/12/2012

IncomeTaxMatters NIL NIL NIL NIL

171

ChambalFertiliser&ChemicalsLimited 1. MaterialShowCauseNoticesaboveRs. 1.00CrorereceivedbytheCompany Sl. BriefParticular No. 1

Claim amount (Rs.InLac)

Court/Forum/Ca seNumber

PresentStatus

Additional Purchase Tax, interest & penalty for 1,809.32 the AY 199697 to 200102 (up to May01) of Rs. 352.34 lacs was levied by the Sales Tax Department vide various notices due to use of Natural Gas for Ammonia fuel, Power & steam generation alleging that it was not used for manufactureoffertilizer. Received letter dated 28.11.08 to deposit 524.34 stampduty@1%underRajasthanStampsAct, 1998, on Bonds executed with Excise deptt. from May 2004 to date. The total tentative liabilityworksouttoRs.5.24crore.

Honble The Company has Rajasthan High obtained a stay from Court,Jodhpur Honble Rajasthan High Court, Jodhpur on11.07.2001.

Central Kota

Excise, The department has not further pursued thematter.

Received show cause notice for non 7,380.36 Jute complianceofJutePackagingMaterial Commissioner, (Compulsory use of Packing Commodities) Act, Kolkata 1987.

The Company received assessment order alongwith demand notice to deposit land tax of Rs.228.58 lacs for the FY 200607 to 2012 13 (Rs.40.02 Lacs being for FY 2006

The Company has obtained stay order against the show cause notice from Delhi High Court. No further development inthecase. Demand of Rs.40.02 Lacs for the FY 2006 07 has been stayed by Rajasthan High Court.

172

07).CompanydepositedanamountofRs.94.30 lacs being the 50% of the demand of land tax for the FY 200708 to 201213 and preferred appeals against the demand before DIG RegistrarcumCollector.

The appeal is pending fordisposal. Appellate authority has directed the assessing authority to reassess the land tax liability for the FY 200708 to 201011 in respect of land being used for industrial purpose only. The re assessmentispending. The appeal in respect of FY 201112 & 2012 13ispending.

2. StatusofmaterialcommerciallitigationsfiledbytheCompanyisasunder: Sl. No. 1 BriefParticular Claim amount (Rs.) Rs.12.50 Crore Court/Forum/Case Number NationalConsumer DisputesRedressal Commission,NewDelhi PresentStatus

Complaint in respect of the Insurers deficiency in service in repudiating a valid insuranceclaimarisingoutofthedamageto andreplacementofCarbamateCondenser

The Ops have entered appearance and as against filing WS directed by the Commission, preferred to file an Application questioning the

173

maintainability of theComplaint. 2 Writ petition filed in the High Court of Rajasthan against Jaipur Vidyut Vitran Nigam Limited for refund of advance deposited by the Company with Rajasthan StateElectricityBoard. Writ Petition filed against State of Rajasthan and others pertaining to bills of Rs.1.99 Crores towards water charges raised by Executive Engineer, Irregation Deptt., GovtofRajasthan. Rs.306 lac HighCourtofRajasthan The matter is posted for admission and the dateisnotfixed.

Not applicable

HighCourtofRajasthan

4 5

5 cases under section 138 of Negotiable InstrumentsAct,1881 Case filed by the BTM against the constitutions validity of the Himachal Pradesh Tax on entry of goods in to local areaAct,2010on4.2.2011. The petition under Sec.482 of Cr.PC for quashing of criminal proceedings instituted by Insecticides Inspector, Sonbhadra against ManagingDirectorandothers.

HighCourt,Shimla

The High Court (Single Bench) has quashed the demand raised by the State Govt.The State Govt.has filed an appeal before the Division Bench against the aforesaidorder. Stay granted by the single bench of High Court on 9.2.2011. Appeal admitted and stay of operation of impugned order granted.

AllahabadHighCourt

3. LitigationsagainsttheCompany:

174

a) AsonSeptember30,2012therewere47casesrelatingtotheEssentialCommoditiesAct,1955. b) As on September 30, 2012 there were 16 cases under Labour Laws, 66 civil cases, 15 cases pending with the Consumer Forum and 2 casesunderMiscellaneousActswhereamountsarenotascertainable. 4. Thereare10consumerforumcasesoutstandingwheretheclaimamountaggregatestoRs.2.70Lac. 5. ACriminalcomplaintispendingintheCourtofChiefJudicialMagistrate,KotainrespectofaccidentoccurredinthefactoryatGadepan, againsttheOccupierandFactoryManageroftheCompanyfiledbytheDy.ChiefInspectorofFactories,undertheprovisionsofFactoriesAct, 1948andRajasthanFactoriesRules. It may kindly be noted that aforesaid information does not include demands of Income Tax, interest and penalties, raised by Income Tax Authoritiesrelatedtoassessmentofincome/TDSoftheCompanyforassessmentyears200203to200910. Theothercases/showcausenoticesareinsignificantconsideringthesizeandnatureofbusinessoftheCompany. TexmacoInfrastructureandHoldingsLimited BriefParticularsand Claim Court/Forum/ Contentions Amount CaseNo. (Rs.in Lacs)

CurrentStatus

175

Daulat Shetkari Sahakari 785.27 Sakhar Karkhana Ltd. has instituted a Suit at Gadhinglaj Court for recovery of Rs.785.27 lacs for alleged delay in delivery and non performance of the Mills & Boilers. The Board of Trustees of the 148.20 Port of Calcutta filed the suit for specific performance of the Contract, recovery of damages. M/s. Prakash Cotton Mills Ltd. 92.26 filed a suit for recovery of alleged losses and nonsupply of materials. The suit was decreed exparty on 24.10.2002.

16/1997 The Bombay High Court has granted Court of the Civil the Stay Order vide interim order Judge, dated31.01.2006. (Senior Division), Gadhinglaj.

The Case is contested by the 38of1992 th 5 Court of the Civil CompanyatDistrictCourtlevel. Judge (Senior Divn.), Alipore

Execution On 18.08.2006, Bombay High Court Application no. 159 passedaninterimorderforstayofex partydecreedated24.10.2002. of2005 Notice no. 649 0f 2005in Suit no.1586 of 1982 BombayHighCourt

176

Mr. S. K. Mondal filed a title 2.28 suitforbackperiodsalary.

766of1995, 1st Court of the Civil Judge, (Senior Division), Barasat.

Companys suit for recovery of Rs.7.50 lacs being amount defalcated by the Mr. Mondal is pending before theCalcuttaHighCourt.

177

BriefParticularsand Contentions Claim Amount (Rs.in Lacs) Court/Forum/ CaseNo. CurrentStatus

ExciseMatters Demand Notice from Central Excise Authority for disallowance of Modvat Credit fortheperiodof199394. Demand Notice from Central Excise Authority for disallowance of Modvat Credit for the period 01.11.1994 to 30.11.1994 Demand Notice from Central Excise Authority for recovery of Cenvat Credit of 4% addl. Duty on imported wheel sets for the period 01.05.2008 to 31.10.2008. Demand Notices from Central Excise Authority for disallowance of Modvat Credit on value of duty paid free issue materials for the periods 01.08.1986 to 06.11.1986, 23.02.1987 to 14.04.1987 & 13.03.1987to13.04.1987.

6.01 Commissioner (Appeal1)

Pending

4.55 CESTAT,Kolkata

Pending

63.40 CESTAT,Kolkata

Pending

135.88 CESTAT,Kolkata

Pending

178

Demand Notices from Central 1275.79 Excise Authority for recovery of amount reimbursed on inputs used in exempted goods for the periods 01.08.2003 to 28.02.2006, 01.10.2003 to 30.11.2005 & 01.12.2003to28.02.2006. Demand Notice from Central 635.20 Excise Authority for recovery of Cenvat Credit availed on inputs on which excise duty paid under SFIS scheme in terms of notification no. 34/2006CEdated14.06.2006. BriefParticularsand Claim Contentions Amount (Rs.in Lacs) Demand Notice from Central 4.50 Excise Authority for valuation of Goods manufactured and captively consumed for the period 01.03.2006 to 31.10.2006.

CESTAT,Kolkata

Pending

CESTAT,Kolkata

Pending

Court/Forum/ CaseNo.

CurrentStatus

CESTAT,Kolkata

Pending

179

Demand Notice from Central Excise Authority for interest on delayed payment of excise duty on a/c of price escalation claimed separately on later date after the clearance of excisable goods for the period October 2006 to February 2010. ServiceTaxMatters Demand Notice from Service Tax Authorities towards input services availed in respect of exempted goods for the period200809to200910. Demand Notice from Service Tax Authorities towards service tax on Business Support Service for the period 01.05.2006to31.12.2007. Demand Notice from Service Tax Authorities towards service tax on import of services for the period 01.04.2004to31.03.2007.

57.48 CESTAT,Kolkata

Pending

2.22 Commissioner (Appeal),Kolkata

Pending

13.89 CESTAT,Kolkata

Pending

0.58 Commissioner (Appeal1)S.Tax

Pending

180

BriefParticularsand Contentions Claim Amount (Rs.in Lacs) 2882.00 Court/Forum/ CaseNo. CurrentStatus

IncomeTaxMatters ITANo.149of2002199596 TexmacoLtd.Vs.CIT Disallowance of amount interest paid to Banks and financial institutions towards discharge of interest liability taken over by Zuari Industries on transfer of Cement division. ITANo.702of2008200001 CITVs.TexmacoLtd Under reassessment, the A. O. disallowed the arrear salary & wages paid to the employees ofBirlaTextilesasperorderof Honble Supreme Court of India. The decisions of CIT (A) and ITAT on this point are favourable to the Company. The ITD filed an Appeal before theCalcuttaHighCourt. HonbleHighCourtof Pending Calcutta.

32.27

HonbleHighCourtof Pending Calcutta

181

ITANo.60of2011200708 CITVs.TexmacoLtd The A.O. disallowed the credit of withholding tax. The decisions of CIT (A) and ITAT are favourable to the Company. The ITD filed an Appeal before the Calcutta HighCourt. A.Y.20082009 TexmacoLtd.vs.CIT Disallowance of certain expenditureandTDScredit.

9.73

HonbleHighCourtof Pending Calcutta

71.60

CIT(Appeal), Kolkata

Pending

182

BriefParticularsand Contentions Court/Forum/ Claim CaseNo. Amount (Rs.in Lacs) 98.94 CIT(Appeal), Kolkata CurrentStatus

A.Y.20092010 TexmacoLtd.vs.CIT Disallowance of certain expenditureandTDScredit.. A.Y.20102011 D.C.I.T.Circle6,Kolkata DisallowanceofTDScredit. SalesTaxMatters Demand notice from W. B. Sales Tax Authority for levying Addl. purchase tax for the year 20032004. The Company has filed an Appeal before the Addl. Commissioner, CommercialTax,Kolkata.

Pending

73.04 D. C. I. T. Circle 6, Pending Kolkata

4.38 Addl.Commissioner, Pending Commercial tax, Kolkata

183

Demand notice from W. B. Sales Tax Authority for levying Surcharge & Addl. Purchase tax for the year 200405 The Company has filed an Appeal before the Addl.Commissioner, CommercialTax,Kolkata. Demand notice from W. B. Sales Tax Authority towards disallowance of input tax credit. The Company has filed an Appeal before the Addl. Commissioner, Commercial Tax,Kolkata.

10.81 Addl.Commissioner, Pending Commercial tax, Kolkata

354.26 Addl.Commissioner, Commercial tax, Kolkata

Pending

184

Court/Forum/ CurrentStatus Claim CaseNo. Amount (Rs.in Lacs) Demand notice from W. B. 551.35 Addl.Commissioner, Pending Sales Tax Authority towards Commercial tax, disallowance of input tax Kolkata creditunderVAT&CSTActfor the year 200607 The Company has filed an Appeal before the Addl.Commissioner, CommercialTax,Kolkata. Demand notice from W. B. Pending 649.13 Addl.Commissioner, Sales Tax Authority towards Commercial tax, disallowance of input tax Kolkata credit. The Company has filed an Appeal before the Addl. Commissioner, Commercial Tax,Kolkata. BriefParticularsand Contentions

185

Litigationsfiledby/againstGroupCompanies TEXMACORAIL&ENGINEERINGLTD BriefParticularsand Claim Contentions Amount (Rs.in Lacs) J.K.IndustriesLtd. ArbitrationAwardbymajority againsttheCompany. 61.45

Court/Forum/ CaseNo.

CurrentStatus

ExecutionPetitionno. 9/2011 DelhiHighCourt

JKIhasfiledtheDecreeexecution petitionforrecoveryofRs.61.45Lacs. TheCompanyhasfiledanAppealagainst theJudgment.

186

Litigationsfiledby/againstJointVentures ZuariMarocPhosphatesLimited LitigationDetailsofIncomeTaxCasesofZuariMarocPhosphatesLimited Sr. Gistofthematter&Year Court/Forum/CaseNo. No 1 IncomeTaxAssessmentforthe IncomeTaxDy.Commissioner Assessmentyear200910was OfIncomeTaxMargao completed. Circle2 Further we got the order rectified under Section 154 since there was an error in Computation. The Said rectification order was silent on Carry forward position , and we have asked the assessing authority to incorporate the same in rectification order. 2. Recentlywehavereceivedassessment IncomeTaxDy.Commissioner noticeforAssessmentYear201011 OfIncomeTaxMargao Circle2 3 CaseNo.8191of2011specialLeave SupremeCourtOfIndia petitionpreferredbytheDepartment againstorderdated28072010passed Issuesinthematterare byHonbleBombayHighCourt(atGoa) 1. Whether the claim of the assessee for deduction of incaseofCITv/sZuariMaroc managerial fees was PhosphatesLimitedfortheassessment bonafide claim as the claim year200405 of the expenditure was made in the year in which the interest income was received.

Status Wehavenotgotcarryforwardpositioninthe order.Followupisgoingon.

Tillnowwedidnothavesittingwiththe assessingofficerandhehastoissuea questionnairethentheprocesswillstart. Thecasehasnotyetcomeupforhearing.

187

Litigationsfiledby/againstJointVentures ZuariRotemSpecialityFertilizersLimited DescriptionofSuits/show ClaimAmount Court/Forum/Case causenotice,etc. (Rs.Inlakhs) No. CivilSuit:Complaint(ULP)No. Claimfor LabourCourtPune 38of2012 Reinstatement

CurrentStatus Pendingforhearing

188

MATERIAL DEVELOPMENTS SINCE THE LAST BALANCE SHEET DATE There are no material developments after the date of balance sheet of the Company as at September 30, 2012 GOVERNMENT APPROVALS OR LICENSING ARRANGEMENTS Nil

189


XVI. ARTICLES OF ASSOCIATION

THE COMPANIES ACT, 1956

COMPANY LIMITED BY SHARES ARTICLES OF ASSOCIATION OF ZUARI AGRO CHEMICALS LIMITED** 1. No regulations contained in Table A, in the First Schedule to the Companies Act, 1956, or in the Schedule to any previous Companies Act, shall apply to this Company, but the regulations for the management of the Company and for the observance of the Members thereof and their representatives, shall, subject to any exercise of the statutory powers of the Company with reference to the repeal or alteration of or addition to, its regulations by Special Resolution as prescribed by the said Companies Act, 1956, be such as are contained in these Articles. INTERPRETATION 2. In the interpretation of these Articles, unless repugnant to the subject or context:**The Company or This Company means ZUARI AGRO CHEMICALS LIMITED The Act means The Companies Act, 1956, or any statutory modification or re-enactment thereof for the time being in force. "These Articles" means the Articles of Association for the time being of the Company or the Articles of Association as altered from time to time by Special Resolution. "Alter" and "Alteration" shall include the making of additions and deletions. Auditors means and includes those persons appointed as such for the time being by the Company. Beneficial Owner shall mean beneficial owner as defined under clause (e) of Section 2 of the Depositories Act,1996. ** Amended vide special resolution passed at Extra Ordinary General Meeting held on September 10,2012 Interpretation Clause The Company or This Company The Act Table A not to apply to Company to be governed by these Articles.

These Articles

Alter Auditors Beneficial Owner

190


Board means a meeting of the Directors duly called and constituted or as the case may be, the Directors assembled at a meeting of the Board. Capital means the share capital for the time being raised or authorised to be raised, for the purpose of the Company. Debenture includes debenture-stock. Directors means the Directors for the time being of the Company or, as the case may be, the Directors assembled at a meeting of the Board. Dividend includes bonus. Member means the duly registered holder from time to time of the shares of the Company and includes the subscribers to the Memorandum of the Company. Meeting or General Meeting means a Meeting of Members. Annual General Meeting means a General Meeting of the Members held in accordance with the provisions of section 166 of the Act. Extraordinary General Meeting means an Extraordinary General Meeting of the Members duly called and constituted and any adjourned holding thereof. Month means a calendar month. Office means the Registered Office for the time being of the Company. Officer includes any director, manager or secretary, (or any person is accordance with whose directions or instructions the Board of Directors or any one or more of the directors is or are accustomed to act), but save in sections 477, 478,539, 543, 545, 621, 625 and 633 does not include an auditor, Officer who is in default shall mean any officer of the Company who is knowingly guilty of the default, noncompliance, failure, refusal or contravention mentioned in that provision, or who knowingly and will fully authorises or permits such default, non-compliance, failure, refusal or contravention. Ordinary Resolution shall have the meaning assigned thereto by Section 189 of the Act. Paid-up includes credited as paid up. Ordinary Resolution Paid-up Board

Capital Debenture Directors

Dividend Member

Meeting or General Meeting Meeting Annual General Meeting Meeting Extraordinary General Meeting Month Office Officer

191


Persons includes corporations and firms as well as individuals. Register of Members means the Register of Members to be kept pursuant to the Act. The Registrar means the Registrar of Companies of the State in which the office of the Company is for the time being situated. Secretary means secretary as defined in section 2(45) of the Act. "Security" means such security as may be specified by SEBI or any other statutory body, from time to time. Seal means the Common Seal for the time being of the Company. Share means share in the share capital of a Company and includes stock except where a distinction between stock and shares is expressed or implied. Words importing the singular number include, where the context admits or requires, the plural number and vice versa and Words importing the masculine gender also include the feminine gender. In Writing and Written include printing, lithography and other modes of representing or reproducing words in a visible form. Special Resolution shall have the meaning assigned thereto by section 189 of the Act. Year means the calendar year and Financial Year shall have the meaning assigned thereto by section 2 (17) of the Act. The marginal notes used in these Articles shall not affect the construction thereof. Save as aforesaid, any words or expressions defined in the Act shall, if not inconsistent with the subject or context, bear the same meaning in these Articles. Persons Register of Members The Registrar

Secretary Security Seal Share

Singular number Gender

In Writing and Written Special Resolution Year and Financial Year

CAPITAL AND INCREASE AND REDUCTION OF CAPITAL *3. The authorised share capital of the Company is Rs.42,05,80,060/- (Rupees forty two crores five lakhs eighty thousand sixty) divided into 4,20,58,006 (four crores twenty Amount of Capital

192


lakhs fifty eight thousand six) equity shares of Rs.10/(Rupees ten) each with right to the Board of Directors to classify them into any class of shares, whether equity or preferential as the Board of Directors may decide. 4. The Company in General Meeting may, from time to time, increase the capital by the creation of new shares, such increase to be of such aggregate amount and to be divided into shares of such respective amounts as the resolution shall prescribe. Subject to the provisions of the Act, any shares of the original or increased capital shall be issued upon such terms and conditions as the General Meeting resolving upon the creation thereof shall direct, and if no direction be given, as the Directors shall determine; and in particular, such shares may be issued with a preferential or qualified right to dividends, and in the distribution of assets of the Company, and with a right of voting at General Meetings of the Company in conformity with Sections 86 & 87 of the Act. Whenever the capital of the Company has been increased under the provisions of this Article, the Directors shall comply with the provisions of Section 97 of the Act. Except so far as otherwise provided by the conditions of issue or by these presents, any capital raised by the creation of new shares shall be considered as part of the existing capital and shall be subject to the provisions herein contained, with reference to the payment of calls and installments, forfeiture, lien, surrender, transfer, and transmission, voting and otherwise. Subject to the provisions of Section 80 of the Act, the Company shall have the power to issue Preference Shares which are, or at the option of the Company, are to be liable to be redeemed and the resolution authorizing such issue shall prescribe the manner, terms and conditions of redemption. On the issue of Redeemable Preference Shares under the provisions of Article 6 hereof the following provisions shall take effect: Increase of capital by the Company and how carried into effect

5.

New capital same as existing capital

6.

Redeemable Preference Shares

7.

Provisions to apply on issue of Redeemable Preference Shares

(a)

No such shares shall be redeemed except out of the profits of the Company which would otherwise be available for dividend or out of the proceeds of a fresh issue of shares made for the purpose of the redemption;

(b) No such shares shall be redeemed unless they are fully paid; (a) The premium, if any, payable on redemption must have been provided for out of the profits of the Company or the Companys share Premium Account before the

193


shares are redeemed; *Amended vide special resolution passed Extraordinary General Meeting held on 26th May, 2011 at the

(d) Where any such shares are redeemed otherwise than out of the proceeds of a fresh issue there shall, out of profits which would otherwise have been available for dividend, be transferred to a reserve fund to be called the Capital Redemption Reserve Account, a sum equal to the nominal amount of the shares redeemed, and the provisions of the Act relating to the reduction of the share capital of the Company shall, except as provided in Section 80 of the Act, apply as if the Capital Redemption Reserve account were paid-up share capital of the Company. 8. (1) Notwithstanding anything contained in these Articles and in pursuance of Section 77A, 77AA and 77 B of the Act, the Company shall have powers, subject to and in accordance with all applicable provisions of the Act and other applicable provisions of any law for the time being in force and subject to such approvals, permissions and sanctions as may be necessary, to buy back/purchase, or acquire any of its own fully paid shares whether or not they are redeemable and may make a payment therefore out of its free reserves or out of the Securities premium account of the Company or out of the proceeds of any issue of shares or other specified securities, made by the Company specifically for the purpose or from such other sources as may be permitted by law for the time being in force on such terms and conditions and in such proportion and in such manner as may be prescribed by law for the time being in force from time to time, provided nothing herein contained shall be' deemed to affect the provisions of Sections 100 to 104 and Section 402 of the Act in so far as and to the extent they are applicable. (2) Except to the extent permitted by Section 77 or other applicable provisions (if any) of the Act, the Company shall not give whether directly or indirectly and whether by means of a loan, guarantee, the provisions of security or otherwise, any financial assistance for the purchase of or in connection with the purchase of or subscription made or to be made by any person of or for any shares in the Company or in its holding Company. (3) Nothing in this Article shall affect the right of the Company to redeem any redeemable preference shares issued under Buy-back of shares

194


these Articles or under Section 80 or other relevant provisions (if any) of the Act. 9. The Company may (subject to the provisions of Sections 78, 80, 100, to 105 inclusive, of the Act) from time to time by Special Resolution, reduce its capital and any Capital Redemption Reserve Account or Premium Account in any manner for the time being authorised by law, and in particular, capital may be paid off on the footing that it may be called up again or otherwise. This Article is not to derogate from any power the Company would have if it were omitted. Subject to the provisions of Section 94 of the Act, the Company in General Meeting may, from time to time, subdivide or consolidate its shares, or any of them and the resolution whereby any share is sub-divided, may determine that, as between the holders of the shares resulting from such sub-division one or more of such shares shall have some preference or special advantage as regards dividend, capital or otherwise over or as compared with the others or other to the extent permitted by law. Subject as aforesaid the Company in General Meeting may also cancel shares which have not been taken or agreed to be taken by any person and diminish the amount of its share capital by the amount of the shares so cancelled. Whenever the capital, by reason of the issue of Preference Shares or otherwise, is divided into different classes of shares, all or any of the rights and privileges attached to each class may subject to the provisions of Sections 106 and 107 of the Act be modified, varied, affected or abrogated or dealt with by Agreement between the Company and any person purporting to contract on behalf of that class, provided such agreement is ratified in writing by the holders of at least three fourths in nominal value of the issued shares of the class or is confirmed by a Special Resolution, passed at a separate General Meeting of the holders of shares of that class. SHARES AND CERTIFICATES 12. The Company shall cause to be kept a Register and Index of Members in accordance with sections 150 and 151 of the Act, and the Depositories Act,1996 with details of shares held in material and dematerialized forms as may be permitted by law. The Register and index of beneficial owners maintained by a Depository under Section 11 of the Depository Act, 1996 shall be deemed to be Register and index of members for the purpose of this Act. The company shall have the power to keep in any state or country outside India a branch Register of members resident in that state or country. The Company shall be entitled to dematerialise its existing shares, debentures and other securities, rematerialize its shares, debentures and other securities held in the Register and Index of Members Reduction of Capital

10.

Sub-division, consolidation and cancellation of shares

11.

Modification of rights

13.

Dematerialisation

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depositories and / or offer its fresh shares and debentures and other securities in a dematerialized form pursuant to the Depositories Act, 1996 and the rules framed thereunder. 14. The shares in the capital shall be numbered progressively according to their several denominations, provided however, that the provisions relating to progressive numbering shall not apply to any shares held in dematerialized form. Except in the manner hereinbefore mentioned no share shall be subdivided. Every forfeited or surrendered share shall continue to bear the number by which the same was originally distinguished. Subject to the provisions of the Act, and or these Articles, the Board may allot and issue shares in the capital of the Company as payment or part payment for any property sold or transferred, goods or machinery supplied or for services rendered to the Company either in or about the formation or promotion of the Company or the conduct of its business and any shares which may be so allotted may be issued as fully paid-up shares and if so issued shall be deemed to be fully paid-up shares. (1) Where the Company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premium on those shares shall be transferred to an account to be called "Securities Premium Account" and. the provisions of the Act relating to the reduction of the share capital of the Company- shall, except as provided in Section 78 of the Act or in this clause, apply as if the Securities Premium Account were paid-up share capital of the Company. (2) The Securities Premium Account may, notwithstanding anything contained in sub-clause (1) hereof, be applied by the Company: (a) (b) (c) (d) in paying up unissued shares of the Company to be issued to Members of the Company as fully paid bonus shares; in writing off the preliminary expenses of the Company. in writing off the expenses of, or the commission paid or discount allowed on any issue of shares or debentures of the Company, or; in providing for the premium payable on the redemption of any redeemable preference shares or of any debentures of the Company. Future issue of capital Shares to be numbered progressively and no share to be subdivided

15.

Issue of shares for consideration

16.

Securities Premium Account

17.

Where the Board decides to increase the subscribed capital of the Company by allotment of further shares whether out of unissued share capital or out of increased share capital, then, then such further shares shall be offered in proportion to their

196


existing holdings in the Company and such offer shall be made by a notice specifying the number of shares offered and limiting a time not being less than fifteen days from the date of the offer within which the offer, if not accepted will be deemed to have been declined. The offer shall include a right exercisable by the person concerned to renounce all or any of the shares offered to him. After the expiry of the time specified in the notice aforesaid or on receipt of earlier intimation from the person to whom such notice is given that he declines to accept the shares offered, the Board may dispose of the said shares to such person or persons as it deems to be in the best interest of the Company. *18. Subject to the provision of these Articles and of the Act, the shares shall be under the control of the Board of directors; who may issue, allot or otherwise dispose of the same to such persons on such terms and conditions and at such times as the Board of Directors thinks fit. The Board shall cause to be filed the returns as to allotment provided for in Section 75 of the Act. *Amended vide Special Resolution passed at the Extraordinary General Meeting held on 30th March, 2012 Provided that option or right to call for Shares shall not be given to any person or persons without the sanction of the Company in the General Meeting. 19. In addition to and without derogating from the powers for that purpose conferred on the Board under Articles 15 and 17 power to Company in General Meeting to issue shares may, subject to the provisions of section 81 of the Act, determine that any shares (whether forming part of the original capital or of any increased capital of the Company) shall be offered to such persons (whether member or not) in such proportion and on such terms and conditions and either (subject to compliance with the provisions of section 78 and 79 of the Act) at a premium or at par or at a discount, such option being exercisable at such times and for such consideration as may be directed by such General Meeting or the Company in General Meeting may make any other provisions whatsoever for the issue, allotment or disposal of any shares. Any application signed by or on behalf of any applicant for shares in the Company, followed by an allotment of any shares therein, shall be an acceptance of shares within the meaning of these Articles, and every person who thus or otherwise accepts any shares and whose name is on the Register shall, for the purposes of these Articles, be a Member. The money (if any) which the Board shall, on the allotment of any shares being made by them, require or direct to be paid Power also to Company in General meeting to issue shares Shares under the control of Board of Directors

20.

Acceptance of shares

21.

Deposit and calls etc. to be a debt

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by way of deposit, call or otherwise, in respect of any shares allotted by them, shall immediately on the inscription of the name of the allottee in the Register of Members as the name of the holder of such shares, become a debt due to and recoverable by the Company from the allottee thereof, and shall be paid by him accordingly. 22. Every Member or his heirs, executors or administrators shall pay to the Company the portion of the capital represented by his share or shares which may for the time being, remain unpaid thereon, in such amounts, at such time to times, and in such manner as the Board shall, from time to time in accordance with the Companys regulations, require or fix for the payment thereof. (a) Every member shall be entitled, without payment, to receive one or more certificates for all the shares of each class registered in his name in marketable lots, or if the Board so approves to several certificates each for one or more of such shares, provided however, that no share certificate(s) shall be issued for shares held by a Depository. Every such certificate shall be issued under the seal of the Company, which shall be affixed in the presence of two Directors or persons acting on behalf of the Directors under a duly registered power of Share Certificates attorney and the Secretary or some other person appointed by the Board for the purpose, and the two Directors or their attorneys and the Secretary or other person shall sign the share certificate. Particulars of every share certificate issued shall be entered in the Register of Members against the name of the person to whom it hasbeen issued, indicating the date of issue. (b) Any two or more joint allottees of a share shall, for the purpose of this Article, be treated as a single Member, and the certificate of any share, which may be the subject of joint ownership, may be delivered to the first named joint owner on behalf of all of them. For any further certificates the Board shall be entitled, but shall not be bound, to prescribe a charge not exceeding Rupee one. The Company shall comply with the provisions of section 113 of the Act. (c) A director may sign a share certificate by affixing his signature thereon by means of any machine equipment or other mechanical means, such as engraving in metal or lithography, but not by means of a rubber stamp, provided that the Director shall be responsible for the safe custody of such machine, equipment or other material used for the purpose. 24. *(a) No certificate of any share or shares shall be issued either in exchange for those which are sub-divided or consolidated or in replacement of those which are Renewal of share Certificate payable immediately

Liability of Members

23.

Share Certificates

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defaced, torn or old, decrepit, worn out, or where the pages on the reverse for recording transfers have been duly utilized, unless the certificate in lieu of which it is issued is surrendered to the Company provided that no fee shall be charged for issue of new certificate in replacement of those which are old, decrepit or worn out or where the pages on the reverse for recording transfer have been fully utilized. (b) When a new share certificate has been issued in pursuance of clause (a) of this Article, it shall state on the face of it and against the stub or counterfoil to the effect that it is issued in lieu of share certificate No. subdivided/replaced/on *Amended vide Special Resolution passed at the Extraordinary General Meeting held on 30th March, 2012 consolidation of shares. The word Duplicate shall be stamped or punched in bold letters across the face of the share certificate. (c) Notwithstanding anything contained in Articles 24 (a) and (b) the Board may refuse applications for sub division or consolidation of equity share certificates into denominations of less than the market trading lot of shares except when such sub-division or consolidation is required to be made to comply with statutory order or an order of a competent court of law.

(d) If a share certificate is lost or destroyed, a new certificate in lieu thereof shall be issued only with the prior consent of the Board and on payment of such fee, if any, not exceeding Rupees two, as the Board may from time to time fix, and on such terms, if any, as to evidence and indemnity and the payment of out-of-pocket expenses incurred by the Company in investigating evidence as the Board thinks fit. (e) Where a new share certificate has been issued in pursuance of Clause (a) or Clause (c) of this Article, particulars of every such share certificate shall be entered in a Register of Renewed and Duplicate Certificates indicating against the names of the persons to whom the certificate is issued, the number and date of issue of the share certificate in lieu of which the new certificate is issued, and the necessary changes indicated in the Register of Members by suitable cross references in the Remarks column. (f) All blank forms to be used for issue of share certificates shall be printed and the printing shall be done only on

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the authority of a resolution of the Board. The blank forms shall be consecutively machine-numbered and the forms and the blocks engravings facsimiles and hues relating to the printing of such forms shall be kept in the custody of the Secretary or such other person as the Board may appoint for the purpose; and the Secretary or the other person aforesaid shall be responsible for rendering an account of these forms to the Board. (g) The Managing Director of the Company for the time being or if the Company has no Managing Director, every Director of the Company shall be responsible for the maintenance, preservation and safe custody of all books and documents relating to the issue of share certificates except the blank forms of share certificates referred to in sub-article(g). (h) All books referred to in sub-article (h) Shall be preserved in good order permanently. 25. If any share stands in the names of two or more persons, the person first named in the Register shall as regards receipts of dividends or bonus or service of notice and all or any other matter connected with the Company, except voting at meetings and the transfer of the shares, be deemed the sole holder thereof but the joint holders of a share shall be severally as well as jointly liable for the payment of all installments and calls due in respect of such shares and for all incidents thereof according to the Companys regulations. (1) Notwithstanding anything herein contained, a person whose name is at any time entered in the Register of Members or in the records of the Depository of the Company as the holder of a share in the Company, but who does not hold the beneficial interest in such a share, shall, within such time and in such form as may be prescribed, make a declaration to the Company specifying the name and other particulars of the person or persons who hold the beneficial interest in such share in the manner provided in Section 187C of the Act. (2) A person who holds a beneficial interest in a share or a class of shares of the Company shall, within ,thirty days from the commencement of Companies (Amendment) Act,1974 or within thirty days after his becoming such beneficial owner, whichever is later, make a declaration to the Company specifying the nature of his interest, particulars of the person in whose name the shares stand in the Register of Members or in the records of the Depository of the Company and such other particulars as may be prescribed as provided in Section 187-C of the Act. The first named of joint holders deemed sole holder

26.

Declaration of beneficial interest

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(3) Whenever there is a change in the beneficial interest in a share referred to above, the beneficial owner shall within thirty days from the date of such change, make a declaration to the Company, in such form and containing such particulars as may be prescribed as provided in Section 187-C of the Act. (4) Notwithstanding any thing contained in these Articles, where any declaration referred to above is made to the Company, the Company shall make a note of such declaration in the Register of Members or in the records of the Depository and file within thirty days form the date of receipt of the declaration, a return in the prescribed form with the Registrar with regard to such declaration. 27. Every holder of shares or debentures or fixed deposits of the Company will have freedom to nominate at any time a person to whom his shares/ debentures/fixed deposit shall vest in the event of his death. Where the shares/debentures/fixed deposits are held by more than one person jointly the joint holders may together nominate, in the prescribed manner, a person to whom the rights in the shares or debentures or fixed deposits of the Company, as the case may be, shall vest in the event of death of all the joint holders. Notwithstanding, anything contained in any other law for the time being in force, in respect of such shares or debentures or fixed deposits of the Company, where nomination made in the prescribed manner purports to confer on any person the right to become entitled to the shares or debentures or fixed deposits of the Company, the nominee shall on the death of the joint holders, become entitled to all the rights in such shares/ debentures/ fixed deposits, or as the case may be, all the joint holders, in relation to such shares or debentures, to the exclusion of all other person, unless the nomination is varied or cancelled in the prescribed manner. Where a nominee is a minor it shall be lawful for the holder of the share/ debentures/fixed deposits to make the nomination to appoint in the prescribed manner any person to become entitled to shares in or debentures or deposits of the Company the event of his death during minority. Any person who becomes a nominee as aforesaid upon the production of such evidence as may be required by the Board of Directors of the Company, elect either to be registered as the holder of the shares or debentures or Deposits or to make such transfer of the shares or debentures as the deceased shareholder or debenture holder could have made. The Board of Directors of the company shall in either case have the same right to decline or to suspend registration as it would have had if the deceased shareholder/debenture holder had transferred the shares or debentures before his death. Nomination by the Share/ debenture holder

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28. Except as ordered by a Court of competent jurisdiction or as by law required, the Company shall be entitled to treat the person whose name appears on the Register of Members as the holder of any share or where the name appears as the beneficial owner of shares in the records of the Depository as the absolute owner thereof and accordingly shall not be bound to recognize any benami trust or equitable, contingent, future or partial interest in any share or (except only as is by these Articles otherwise expressly provided) any right in respect of a share other than an absolute right thereto, in accordance with these Articles, in the person from time to time registered as the holder thereof; but the Board shall be at liberty at their sole discretion to register any share in the joint names of any two or more persons or the survivor or survivors of them. In respect of shares, debentures and securities held by Depository on behalf of the owners as defined in the Depositories Act, 1996, the provisions of Section 153, 153A, 153B, 187C and 372A of the Act shall not apply. UNDERWRITING AND BROKERAGE 30. Subject to the provisions of Section 76 of the Act the Company may at any time pay a commission to any person in consideration of his subscribing or agreeing to subscribe (whether absolutely or conditionally) for any shares or debentures in the Company or procuring or agreeing to procure subscription (whether absolute or conditional) for any shares or debentures in the Company, but so that the commission shall not exceed in the case of share, five percent of the price at which the shares are issued and in the case of debentures two and a half percent of the price at which the debentures are issued. Such commission may be satisfied by payment of cash or by allotment of fully or partly paid shares or partly in one way and partly in the other. The Company may pay a reasonable sum for brokerage. INTEREST OUT OF CAPITAL 32. Where any shares are issued for the purpose of raising money to defray the expenses of the construction of any work or building or the provision of any plant which cannot be made profitable for a lengthy period, the Company may pay interest on so much of that share capital as is for the time being paidup for the period at the rate and subject to the conditions and restrictions provided by Section 208 of the Act, and may charge the same to capital as part of the cost of construction of the work or building or the provision of plant. Interest may be paid out of capital Commission may be paid Company not bound to recognise any interest in share other than that of registered holder

29

Certain Sections of the Act not to apply

31.

Brokerage

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CALLS 33. The Board may, from time to time, subject to the terms on which any shares may have been issued and subject to the conditions of allotment, by a resolution passed at a meeting of the Board (and not by circular resolution) make such calls as it thinks fit upon the Members in respect of all moneys unpaid on the shares held by them respectively and each Member shall pay the amount of every call so made on him to the person or persons and at such times and place appointed by the Board. A call may be made payable by installments. Fourteen days notice in writing of any call shall be given by the Company specifying the time and place of payment, and the person or persons to whom such call shall be paid. A call shall be deemed to have been made at the time when the resolution authorising such call was passed at a meeting of the Board. A call may be revoked or postponed at the discretion of the Board. The joint-holders of a share shall be jointly and severally liable to pay all calls in respect thereof. The Board may, from time to time, at its discretion extend the time fixed for the payment of calls and may extend such time as to all or any of the members who from residence at a distance or other cause, the Board may deem fairly entitled to such extension but no Member shall be entitled to such extension save as a matter of grace and favour. If any Member fails to pay any call due from him on the day appointed for payment thereof or any such extended period thereof as aforesaid, he shall be liable to pay interest on the same from the day appointed for the payment thereof to the time of actual payment at such rate as shall from time to time be fixed by the Board not exceeding 12 percent per annum but nothing in this Article shall render it obligatory for the Board to demand or recover any interest from any such member. Any sum, which by the terms of issue of a share becomes payable on allotment or at any fixed date, whether on account of the nominal value of the share or by the way of premium, shall for the purposes of these Articles be deemed to be a call duly made and payable on the date on which by the terms of issue the same becomes payable, and in case of non-payment all the relevant provisions of these Articles as to payment of interest and expenses, forfeiture or otherwise shall apply as if such sum had become payable by virtue of a call duly made and notified. Board of Directors may make calls

34.

Notice of calls

35.

Call to date from resolution Call may be revoked or postponed Liability of joint holders Directors may extend time

36.

37. 38.

39.

Calls to carry interest

40.

Sums deemed to be calls

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41. On the trial or hearing of any action or suit brought by the Company against any Member or his representatives for the recovery of any money claimed to be due to the Company in respect of his shares, it shall be sufficient to prove that the name of the Member in respect of whose share the money is sought to be recovered, appears entered on the Register of Member as proof on a trial of any suit for recovery of money due from the share holder at or subsequently to the date at which the money is sought to be recovered is alleged to have become due on the shares in respect of which such money is sought to be recovered; that the resolution making the call is duly recorded in the Minute Book; and that notice of such call was duly given to the Member or his representatives sued in pursuance of these Articles; and that it shall not be necessary to prove the appointment of the Directors who made such call nor that a quorum of Directors was present at the Board at which any call was made, nor that the meeting at which any call was made was duly constituted nor any other matters whatsoever, but the proof of the matters aforesaid shall be conclusive evidence of the debt. Neither the receipt by the Company of a portion of any money which shall from time to time be due from any Member to the Company in respect of his shares, either by way of principal or interest, nor any indulgence granted by the Company in respect of the payment of any such money, shall preclude the Company from thereafter proceeding to enforce a forfeiture of such shares as hereinafter provided. (a) The Board may, if it thinks fit, agree to and receive from any Member willing to advance the same, all or any part of the amounts of the face value of his shares beyond the sums actually called up and upon the money so paid in advance, or upon so much thereof from time to time and at any time thereafter as exceeds the amount of calls then made upon and due in respect of the shares on account of which such advances are made, the Board may pay or allow interest at such rate (not exceeding without the sanction of the Company in General Meeting 12 per cent per annum) as the Member paying the sum in advance and the Board agree upon. The Board may agree to repay at any time any amount advanced or may at any time repay the same upon giving to the Member three months notice in writing. Provided that money paid in advance of calls shall not confer a right to dividend or to participate in profits. (b) No member paying any such sum in advance shall be entitled to voting rights in respect of the moneys so paid by him until the same would but for such payment become presently payable. Proof on trial of suit for money due on shares

42.

Partial payment not to preclude forfeiture

43.

Payment in anticipation of calls may carry interest

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LIEN 44. The Company shall have lien on every share (not being fully paid up Share ) for all moneys called or payable at a fixed time in respect of that share; but the Company shall have no general lien on such partly paid shares. The Directors may at any time declare any share to be wholly or in part exempt from the provisions of this Articles. For the purpose of enforcing such lien the Board may sell the shares subject thereto in such manner as they shall think fit and for that purpose may cause to be issued a duplicate certificate in respect of such shares and may authorise one of their number to execute a transfer thereof on behalf of and in the name of such member. No sale shall be made until such period as aforesaid shall have arrived, and until notice in writing of the intention to sell shall have been served on such member or his representatives and default shall have been made by him or them in payment, fulfillment, or discharge or such debts, liabilities or engagements for fourteen days after such notice. The net proceeds of any such sale shall be received by the Company and applied in or towards payment of such part of the amount in respect of which the lien exists as is presently payable and the residue, if any, shall (subject to a like lien for sums not presently payable as existed upon the shares before the sale) be paid to the persons entitled to the shares at the date of the sale. FORFEITURE OF SHARES 47. If any Member fails to pay any call or installment of a call on or before the day appointed for the payment of the same or any such extension thereof as aforesaid, the Board may at any time thereafter, during such time as the call or installment remains unpaid give notice to him requiring him to pay the same together with any interest that may have accrued and all expenses that may have been incurred by the Company by reason of such non- payment. The notice shall name a day (not being less than fourteen days from the date of the notice) and a place or places on and at which such call or installment and such interest thereon at such rate not exceeding 12 percent per annum as the Directors shall determine from the day on which such call or installment ought to have been paid and expenses as aforesaid are to be paid. The notice shall also state that in the event of the non-payment at or before the time and at the place appointed, the shares in respect of which the call was made or installment is payable will be liable to be forfeited. If the requirements of any such notice as aforesaid shall not be complied with, every or any share in respect of which such If money payable on share not paid, notice to be given to Member Company to have lien on shares

45.

As to enforcing lien by sale

46.

Application of proceeds of sale

48.

Terms of notice

49.

In default of payment shares to

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notice has been given may at any time thereafter before payment of all calls or installments, interest and expenses due in respect thereof, be forfeited by a resolution of the Board to that effect. Such forfeiture shall include all dividends declared or any other moneys payable in respect of the forfeited share and not actually paid before the forfeiture. 50. When any share shall have been so forfeited notice of the forfeiture shall be given to the Member in whose name it stood immediately prior to the forfeiture, and an entry of the forfeiture, with the date thereof shall forthwith be made in the Register of members but no forfeiture, shall be in any manner invalidated by any omission or neglect to give such notice or to make any such entry as aforesaid. Any share so forfeited shall be deemed to be the property of the Company, and may be sold, re-allotted or otherwise disposed of, either to the original holder thereof or to any other person, upon such terms and in such manner as the Board shall think fit. Any member whose shares have been forfeited shall notwithstanding the forfeiture be liable to pay and shall forthwith pay to the Company on demand all calls, installments, interest and expenses owing upon or in respect of such shares at the time of the forfeiture, together with interest thereon from the time of the forfeiture until payment, at such rate not exceeding 12 percent per annum as the Board may determine and the Board may enforce the payment thereof, if it thinks fit. The forfeiture of a share shall involve extinction, at the time of the forfeiture, of all interest in and all claims and demands against the Company, in respect of the share and all other rights incidental to the share, except only such of those rights as by these Articles are expressly saved. A declaration in writing that the declarant is a Director or Secretary of the Company and that a share in the Company has been duly forfeited in accordance with these Articles on a date stated in the declaration, shall be conclusive evidence of the facts there in stated as against all persons claiming to be entitled to the shares. Upon any sale after forfeiture or for enforcing a lien in purported exercise of the powers here in before given, the Board may appoint some person to execute an instrument of transfer of the shares sold and cause the purchasers name to be entered in the Register in respect of the share sold, and the purchaser shall not be bound to see to the regularity of the proceedings or to the application of the purchase money, and after his name has been entered in the Register in respect of such shares, the validity of the sale shall not be impeached by any person and the remedy of any person aggrieved by the be forfeited

Notice of forfeiture to a Member

51.

Forfeited share to be property of the Company and may be sold etc Member still liable to pay money owing at time of forfeiture and interest

52.

53.

Effect of forfeiture

54.

Evidence of forfeiture

55.

Validity of sale

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sale shall be in damages only and against the Company exclusively. 56. Upon any sale, re-allotment or other disposal under the provisions of the preceding Articles, the certificate or certificates originally issued in respect of the relative shares shall (unless the same shall on demand by the Company have been previously surrendered to it by the defaulting Member) stand cancelled and become null and void and of no effect, and the Directors shall be entitled to issue a new certificate or certificates in respect of the said shares to the person or persons entitled thereto. The Board may at any time before any share so forfeited shall have been sold, re-allotted or otherwise disposed of, annul the forfeiture there of upon such conditions as it thinks fit. TRANSFER AND TRANSMISSION OF SHARES 58. The Company shall keep a Register of Transfers, and therein shall be fairly and distinctly entered particulars of every transfer or transmission of any share held in physical form. In the case of transfer of shares debentures or other marketable securities where the company has not issued any certificate and where such shares or debentures or securities are being held in dematerialized form the provisions of the Depositories Act 1996 shall apply. Shares in the Company may be transferred by an instrument in writing in the usual common form or in such other form as shall from time to time be approved by Directors provided that if so required by the provisions of the Act, such instrument of transfer shall be in the form prescribed and shall be duly stamped and delivered to the Company within the prescribed period. The Instrument of Transfer shall be accompanied by the share certificate in the name of the transferor or by such other evidence as the Board may require to prove the title of the transferor and his right to transfer the shares, and every registered instrument of transfer shall remain in the custody of the Company until destroyed by order of the Board. The transferor shall be deemed to be the holder of such shares until the name of the transferee shall have been entered in the register of members in respect thereof except in case of transfer of shares held in the dematerialized form. The Board shall have power on giving not less than seven days previous notice by advertisement in some newspaper circulating in the district in which the registered office of the Company is situate to close the Transfer Books, the Register of Members or Register of debenture-holders at such time to times and for such period or periods, not exceeding thirty Register of transfers Provisions of Depositaries Act, 1996 to apply in case of shares in electronic form. Form of Transfer Cancellation of share certificates in respect of forfeited shares

57.

Power to annul forfeiture

59.

60.

61.

Instrument of transfer and evidence.

62.

Transfer Books and Register of Members when closed

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days at a time and not exceeding in the aggregate forty-five days in each year. *63. Subject to the provisions of Section 111 of the Act, the board may refuse, whether in pursuance of any *Amended vide Special Resolution passed at the Extraordinary General Meeting held on 30th March, 2012 power of the Company under these Articles or otherwise to register the transfer of, or the transmission by operation of law, of the right to, any shares or interest of a member in, or debentures of the Company, but in such case the Company shall within one month from the date on which the instrument of transfer or the intimation of transmission, as the case may be, was lodged with the Company, send to the transferee and the transformer notice of the refusal to register such transfer, giving reasons for such refusal. Provided that the registration of transfer shall not be refused on the ground of the transferor being either alone or jointly with any other person or persons, indebted to the Company on any account whatsoever, except when the Company has lien on Shares. 64. Where, in the case of partly paid shares, an application for registration is made by the transferor, the Company shall give notice of the application to the transferee in accordance with the provisions of section 110 of the Act. In the case of the death of any one or more of the persons named in the Register of Members as the joint-holders of any share, the survivor or survivors shall be the only person recognised by the Company as having any title to or interest in such share, but nothing herein contained shall be taken to release the estate of a deceased joint-holder from any liability on shares held by him jointly with any other person. The executors or administrators or holders of a succession certificate or the legal representatives of a deceased member (not being one or two more joint-holders) shall be the only persons recognised by the Company as having any title to the shares registered in the name of such member, and the Company shall not be bound to recognise such executors or administrators or holders of a succession certificate or the legal representatives unless such executors or administrators or legal representatives shall have first obtained probate or letters of administration or succession certificate, as the case may be, from a duly constituted Court in the Union of India: provided that in any case where the Board in its absolute discretion thinks fit, the Board may dispense with production of Probate or letters of Administration or Succession Certificate, upon such terms as indemnity or otherwise as the Board in its absolute discretion may think necessary and register the name of any person who claims to be absolutely entitled to the shares standing in the name of a deceased Notice of application when to be given. Death of one or more joint holders of shares Board of Directors may refuse to register transfer

65.

66.

Title to shares of deceased member

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Member as a Member. 67. Every holder of shares or debentures of the Company may at any time nominate, in the prescribed manner, any person to whom his shares or debentures of the Company shall vest in the event of his death subject to the provisions contained in Section 109A of the Act. No share shall in any circumstances be transferred to any infant, insolvent or person of unsound mind. Subject to the provisions of Articles 65 and 66 any person becoming entitled to shares in consequence of the death, lunacy, bankruptcy or insolvency or any Member or by any lawful means other than by a transfer in accordance with these Articles may, with the consent of the Board (which it shall not be under any obligation to give), upon producing such evidence that he sustains the character in respect of which he proposes to act under this Article or of such title as the Board thinks sufficient, either be registered himself as the holder of the shares or elect to have his nominee registered and in such an event he shall testify his election by executing in favour of his nominee an instrument of transfer in accordance with the provisions herein contained, and until he does so, he shall not be freed from any liability in respect of the shares. A person entitled to a share by transmission shall, subject to the right of the Directors to retain such dividends or money as hereinafter provided, be entitled to receive and may give a discharge for, any dividends or other moneys payable in respect of the share. There shall be paid to the Company, in respect of the transfer or transmission of any number of shares to the same party, such fee, if any, as the Board may require. The Company shall incur no liability or responsibility whatever inconsequence of its registering or giving effect to any transfer of shares made or purporting to be made by any apparent legal owner thereof as shown on or appearing in the Register of Members to the prejudice of persons having or claiming any equitable right, title or interest to or in the said shares, notwithstanding that the Company may have had notice of such equitable right, title or interest or notice prohibiting registration of such transfer, and may have entered such notice, or referred thereto, in any book of the Company, and the Company shall not be bound or required to regard or attend or give effect to any notice which may be given to it of any equitable right, title or interest, or be under any liability whatsoever for refusing or neglecting so to do, though it may have been entered or referred to in some book of the Company, but the Company shall nevertheless be at liberty to regard and attend to any such notice and give effect thereto if the Board shall think fit. Nomination

68. 69.

No transfer to infant, etc. Registration of persons entitled otherwise than by transfer

70.

Person entitled may receive dividend without being registered a member Fee on transfer or transmission Company not liable for disregard of a notice prohibiting registration of a transfer

71. 72.

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COPIES OF MEMORANDUM AND ARTICLES TO BE SENT TO MEMBERS 73. Copies of the Memorandum and Articles of Association of the company and other documents referred to in section 30 of the Act shall be sent by the Company to every Member at his request within seven days of the request on payment of the sum of Rupees one for each copy. Copies of Memorandum and Articles of Association to be sent by the Company

BORROWING POWERS 74. Subject to the provisions of section 292 of the Act the Board may, from time to time at its discretion by a resolution passed at a meeting of the Board, accept deposits from Members either in advance of calls or otherwise and generally raise or borrow or secure the payment of any sum or sums of money for the Company. Provided, however, where the money to be borrowed together with the moneys already borrowed (apart from temporary loans obtained from the Companys bankers in the ordinary course of business) exceed the aggregate of the paid-up capital of the company and its free reserves (not being reserves set apart for any specific purpose) the Board shall not borrow such money without the consent of the Company in General Meeting. Subject to the provisions of Articles 74 hereof, the payment or repayment of moneys borrowed as aforesaid may be secured in such manner and upon such terms and conditions in all respect as the Resolution shall prescribe including by the issue of debentures or debenture-stock of the Company, charged upon all or any part of the property of the Company (both present and future), including its uncalled capital for the time being; and debentures, debenture-stock and other securities may be made assignable free from any equities between the Company and the person to whom the same may be issued. Any debentures, debenture-stock or other securities may be issued at a discount, premium or otherwise and may be issued on condition that they shall be convertible into shares of any denomination, and with privileges and conditions as to redemption, surrender, drawing, allotment of shares and attending (but not voting) at General meetings, appointment of Directors and otherwise. Debentures with the right to conversion into or allotment of shares shall be issued only with the consent of the Company in General Meeting accorded by a Special Resolution. The Board shall cause a proper Register to be kept in accordance with the provisions of section 143 of the Act of all mortgages, debentures and charges specifically affecting the Power to borrow

75.

Payment or repayment of moneys borrowed

76.

Terms of issue of debentures

77.

Register of Mortgage etc. to be kept

210


property of the Company; and shall cause the requirements of sections 118, 125 and 127 to 144 (both inclusive) of the Act in that behalf to be duly complied with, so far as they fall to be complied with by the Board. 78. The Company shall, if at any time it issues debentures, keep a Register and Index of Debenture-holders in accordance with Section 152 of the Act. The Company shall have the power to keep in any state or country outside India a branch Register of Debenture-holders resident in that state or country. Save as provided in Section 108 of the Act, no transfer of debentures shall be registered unless a proper instrument of transfer duly stamped and executed by the transferor and transferee has been delivered to the company together with the certificate or certificates of the debentures. Index of Debenture holders

79.

Instrument of Transfer

SHARE WARRANTS 80. The Company may issue share warrants subject to and in accordance with the provisions of Section 114 and 115 of the Act and accordingly the Board may in its discretion with respect to any share which is fully paid upon application in writing, signed by the person registered as holder of the share and authenticated by such evidence (if any) as the Board may, from time to time require as to identity of the person signing the application and on receiving the certificate (if any) of the share and the amount of the stamp duty on the warrant and such fee as the Board may from time to time require issue a share warrant. (1) The bearer of a share warrant may at any time deposit the warrant at the office of the Company and so long as the warrant remains so deposited, the depositor shall have the same right of signing a requisition for calling a meeting of the Company and of attending and voting and exercising the other privileges of a member at any time of deposit, as if his name were inserted in the Register of Members as the holder of the share included in the deposited warrant. (2) Not more than one person shall be recognised as depositor of the share warrant. (3) The Company shall on two days' written notice, return the deposited share warrant to the depositor. 82. (1) Subject as herein otherwise expressly provided, no person shall as bearer of a share warrant, sign a requisition for calling a meeting of the Company, or attend, or vote or exercise any other privileges of a Privileges and disabilities of the holders of share warrants. Power to issue share warrants

81.

Deposit of share warrant

211


member at a meeting of the Company, or be entitled to receive any notices from the Company. (2) The bearer of a share warrant shall be entitled in all other respects to the same privileges and advantages as if he was named in the Register of Members as the holder of the share included in the warrant and he shall be a member of the Company. 83. The Board may from time to time, make rules as to the terms on which (if it shall think fit) a new share warrant or coupon may be issued by way of renewal in case of defacement, loss or destruction. CONVERSION OF SHARES INTO STOCK AND RECONVERSION 84. The Company in General Meeting may convert any paid-up shares into stock; and when any shares shall have been converted into stock, the several holders of such stock may henceforth transfer their respective interest therein, or any part of such interest, in the same manner and subject to the same regulations as, and subject to which shares from which the stock arise might have been transferred, if no such conversion had taken place, or as near thereto as circumstances will admit. The Company may at any time reconvert any stock into paid-up shares of any denomination. The holders of stock shall, according to the amount of stock held by them, have the same rights, privileges and advantages as regards dividends, voting at meetings of the Company, and other matters, as if they held the shares from which the stock arose; but no such privilege or advantage (except participation in the dividends and profits of the Company and in the assets of winding- up) shall be conferred by an amount of stock which would not, if existing in shares, have conferred that privilege or advantage. MEETINGS OF MEMBERS 86. The Company shall in each year hold a General Meeting as its Annual general Meeting in addition to any other meetings in that year. All General Meetings other than Annual General Meetings shall be called Extra-ordinary General Meetings. An Annual General Meeting of the Company shall be held within six months after the expiry of each financial year, provided that not more than fifteen months shall elapse between the date of one Annual General Meeting and that of the next. Nothing contained in the foregoing provisions shall be taken as affecting the right conferred upon the Registrar under the provisions of section 166(1) of the Act to extend the time within which any Annual General Meeting may be held. Every Annual General Meeting shall be called for a time during Act to extend the time within which any Annual General Meeting Shares may be converted into stock Issue of new share warrant or coupon

85.

Right of StockHolders

212


business hours, on a day that is not a public holiday, and shall be held at the Office of the Company or at some other place within the city in-which the Office of the Company is situated as the Board may determine and the Notices calling the Meeting shall specify it as the Annual General Meeting. The Company may in any one Annual General Meeting fix the time for its subsequent Annual General Meeting. Every Member of the Company shall be entitled to attend either in person or by proxy and the Auditor of the Company shall have the right to attend and to be heard at any General Meeting which he attends on any part of the business which concerns him as Auditor. Every Director of the Company shall also be entitled to attend every General Meeting of the Company and shall receive notice of every General Meeting. At every Annual General Meeting of the Company there shall be laid on the table the Directors Report and Audited Statement of Accounts. Auditors report (if not already incorporated in the Statement of Accounts), the proxy Register with proxies and the Register of Directors shareholdings which latter Register shall remain open and accessible during the continuance of the meeting. The Board shall cause to be prepared the Annual List of Members, Summary of the Share Capital, Balance Sheet and Profit and Loss Account and forward the same to the Registrar in accordance with sections 159, 161 and 220 of the Act. 87. The Board may, whenever it thinks fit, call an Extraordinary General Meeting and it shall do so upon a requisition in writing by any Member or Members holding in the aggregate not less than one-tenth of the paid-up capital as at that date carries the right of voting in regard to the matter in respect of which the requisition has been made. Any valid requisition so made by members must state the object or objects of the meeting proposed to be called, and must be signed by the requisitionists and be deposited at the Office provided that such requisition may consist of several documents in like form each signed by one or more requisitionists. Upon the receipt of any such requisition, the Board shall forthwith call an Extraordinary General Meeting, and if they do not proceed within twenty one days from the date of the requisition being deposited at the Office to cause a meeting to be called on a day not later than forty-five days from the date of deposit of the requisition, the requisitionists, or such of their number as represent either a majority in value of the paid-up share capital held by all of them or not less than onetenth of such of the paid-up share capital of the company as is referred to in section 169(4) of the Act, whichever is less, may themselves call the meeting, but in either case any meeting so called shall be held within three months from the date of the delivery of the requisition as aforesaid. Extraordinary General Meeting

88.

Requisition of Members to state object of meeting

89.

On receipt of requisition, Directors to call meeting and in default requisitionists may do so

213


90. Any meeting called under foregoing Articles by the requisitionists shall be called in the same manner, as nearly as possible, as that in which meetings are to be called by the Board. Twenty-one days notice at the least of every General Meeting, Annual or Extra-ordinary and by whomsoever called specifying the day, place and hour of meeting, and the general nature of the business to be transacted thereat, shall be given in manner hereinafter provided, to such persons as are under these Articles entitled to receive notice from the Company. Provided that in the case of an Annual General Meeting with the consent in writing of all the Members entitled to vote thereat and in case of any other meeting with the consent of Members not less than 95 per cent of such part of the paid-up share capital of the Company as gives a right to vote at the meeting, a meeting may be convened by a shorter notice. The provisions of section 173 of the Act shall not apply with respect to General Meeting (including an Annual General Meeting) of the Company. The accidental omission to give any such notice as aforesaid to any of the member, or the non-receipt thereof, shall not invalidate any resolution passed at any such meeting. No General Meeting, Annual or Extraordinary, shall be competent to enter upon, discuss or transact any business which has not been mentioned in the notice or notices upon which it was convened save and except with the prior permission of the Chairman of that meeting. The quorum for a General Meeting of Shareholders shall be five persons present in person or by authorised representative. A body corporate being a Member shall be deemed to be personally present if it is represented in accordance with Section 187 of the Act. If, at the expiration of half an hour from the time appointed for holding a meeting of the Company, a quorum shall not be present, the meeting, if convened by or upon the requisition of Members, shall stand dissolved, but in any other case the meeting shall stand adjourned to the same day in the next week or if that day is a public holiday of the same time and place or to such other day and at such other time and place within the city in which the office of the company is situated as the Board may determine, and if at such adjourned meeting a quorum is not present at the expiration of half an hour from the time appointed for holding the meeting, the Members present shall be a quorum, and may transact the business for which the meeting was called. Meeting called by requisitionists

91.

Twenty-one days notice of meeting to be given

92.

Omission to give notice not to invalidate a resolution passed Meeting not to transact business not mentioned in notice. Quorum at General Meeting Body Corporate deemed to be personally present If Quorum not present, meeting to be dissolved or adjourned

93.

94.

95.

96.

214


97. The Chairman (if any) of the Board shall be entitled to take the chair at every General Meeting, whether Annual or Extraordinary. If there be no such Chairman, or if at any meeting he shall not be present within fifteen minutes of the time appointed for holding such a meeting or if he shall be unable or unwilling to take the chair then the members present shall elect another Director as Chairman, and if no Director be present or if all the Directors present decline to take the chair, then the Members present shall elect one of their number to be Chairman. No business shall be discussed at any General Meeting except the election of a Chairman, whilst the chair is vacant. Chairman of General Meeting

98.

Business confined to election of Chairman whilst chair vacant Chairman with consent may adjourn meeting

99.

The Chairman with the consent of the members may adjourn any meeting from time to time and from place to place within the city in which the registered office of the Company is situated but no business will be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place. At any General Meeting a resolution put to the vote of the meeting shall be decided on a show of hand unless a poll is (before or on the declaration of the result of the show of hands) ordered to be taken by the Chairman of the meeting of his own motion or is demanded by (a) one Member having the right to vote on the resolution and present in person or by proxy if not more than seven such Members are personally present and by two such members present in person or by proxy if more than seven such persons are personally present or (b) by any Member of Members present in person or by a proxy and having not less than one- tenth of the total voting power in respect of the resolution or (c) by the Member of Members present in person or by proxy and holding shares in the Company conferring a right to vote on the resolution being shares on which an aggregate sum has been paid- up which is not less than one-tenth of the total sum paid-up on all the shares conferring that right and unless a poll is so ordered or demanded a declaration by the Chairman that a resolution has on a show of hands been carried or carried unanimously or by a particular majority or lost and an entry to that effect in the Minute Book of the Company shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against that resolution. In case of an equality of votes, the Chairman shall both on a show of hands and at a poll (if any) have a casting vote in addition to the vote or votes to which he may be entitled as a Member. If a poll is demanded as aforesaid the same shall be taken at such time (not later than forty-eight hours from the time when

100.

Questions at General Meeting how decided

101.

Chairmans casting vote Poll to be taken if demanded

102.

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the demand was made) and place and either by open voting or by ballot, as the Chairman shall direct, and either at once or after an interval or adjournment, or otherwise, and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded. The demand for a poll may be withdrawn at any time by the person or persons who made the demand. 103. Where a poll is to be taken, the Chairman of the meeting shall appoint two scrutineers to scrutinise the votes given on the poll and to report thereon to him. One of the scrutineers so appointed shall always be a Member (not being an officer or employee of the Company) present at the meeting provided such a Member is available and willing to be appointed. The Chairman shall have power at any time before the result of the poll is declared to remove a scrutineer from office and fill vacancies in the office of scrutineer arising from such removal or from any other cause. Any poll duly demanded on the election of a Chairman of a meeting or on any question of adjournment shall be taken at the meeting forthwith. The demand for a poll except on the questions of the election of the Chairman and of an adjournment shall not prevent the continuance of a meeting for the transaction of any business other than question on which the poll has been demanded. VOTES OF MEMBERS 106. No member shall be entitled to vote either personally or by proxy at any General Meeting or Meeting of a class of shareholders either upon a show of hands or upon a poll in respect of any shares registered in his name on which any calls or other sums presently payable by him have not been paid or in regard to which the Company has, and has exercised, any right of lien. Subject to the provisions of these Articles and without prejudice to any special privileges or restrictions as to voting for the time being attached to any class of shares for the time being forming part of the capital of the Company, every Member, not disqualified by the last preceding Article shall be entitled to be present and to speak and vote at such meeting. On a show of hands every Member present in person or by proxy shall have one vote and upon a poll the voting right or every Member present in person or by proxy shall be in proportion to his share of the paid-up equity share capital of the Company. Provided, however, if any preference shareholder be present at any meeting of the Company, save as provided in clause (b) of sub-section (2) of Section 87, he shall have a right to vote only on resolution placed before the Members in arrears not to vote Scrutineers at poll

104.

In what case poll taken without adjournment Demand for poll not to prevent transaction of other business

105.

107.

Number of votes of which Member entitled

216


meeting which directly affect the rights attached to his preferences shares. 108. On a poll entitled to entitled to votes, use he uses. taken at a meeting of the Company, a Member more than one vote, or his proxy or other person vote for him, as the case may be, need not, if he all his votes or cast in the same way all the votes Casting of votes by a Member entitled to more than one vote How Members non compos mentis and minor may vote

109.

A Member of unsound mind or in respect of whom an order has been made by any Court having jurisdiction in lunacy, may vote, whether on show of hands or on a poll, by his committee or other legal guardian; and any such committee or guardian may, on poll vote by proxy; if any Member be a minor the vote in respect of his share or shares shall be by his guardian, or any one of his guardians, if more than one, to be elected in case of dispute by the Chairman of the meeting. If there be joint registered holders of any shares, any one of such persons may vote at any meeting or may appoint another person (whether a Member or not) as his proxy in respect of such shares, as if he was solely entitled thereto but the proxy so appointed shall not have any right to speak at the meeting and if more than one of such joint-holders be present at any meeting, that one of the said person so present whose name stands higher on the Register shall alone be entitled to speak and to vote in respect of such shares but the other or others of the joint-holders shall be entitled to be present at the meeting. Several executors or administrators of a deceased Member in whose name shares stand shall for the purpose of these Articles be deemed joint-holders thereof. Subject to the provisions of these Articles votes may be given either personally or by proxy. A body corporate being a Member may vote either by a proxy or by a representative duly authorised in accordance with Section 187 of the Act and such representative shall be entitled to exercise the same rights and powers (including the right to vote by proxy) on behalf of the body corporate which he represents as that body could exercise if it were an individual Member. Any person entitled to transfer any share may vote at any General Meeting in respect thereof in the same manner as if he was the registered holder of such shares, provided that forty-eight hours at least before the time of holding the meeting or adjourned meeting, as the case may be, at which he proposes to vote he shall satisfy the Directors of his right to transfer such shares and give such indemnity (if any) as the directors may require or the Directors shall have previously admitted his right to vote at such meeting in respect thereof. Every proxy ( Whether a Member or not) shall be appointed in writing under the hand of the appointer or his attorney or if such appointer is a body corporate under the common seal of

110.

Votes of joint Members

111.

Voting in person or by proxy

112.

Votes in respect of shares of deceased and insolvent Member

113.

Appointment of proxy

217


such corporation or be signed by an officer or an attorney duly authorised by it, and any Committee or guardian may appoint such proxy. The proxy so appointed shall be entitled to speak at the meetings. 114. An instrument of proxy may appoint a proxy either for the purpose of a particular meeting specified in the instrument and any adjournment thereof or it may appoint for the purposes of every meeting of the Company or of every Meeting to be held before a date specified in the instrument and every adjournment of any such meeting. A Member present by proxy shall be entitled to vote on a show of hands as well as on a poll. Proxy either for specified meeting or for a period

115.

No proxy except for a body corporate to vote on a show of hands Deposit of instrument of appointment

116.

The instrument appointing a proxy and the power of attorney or other authority (if any) under which it is signed or a notarially certified copy of that power or authority, shall be deposited at the office not later than forty-eight hours before the time for holding the meeting at which the person named in the instrument proposes the vote and in default the instrument of proxy shall not be treated as valid. No instrument appointing a proxy shall be valid after the expiration of twelve months from the date of its execution. Every instrument of proxy whether for a specified meeting or otherwise shall, as nearly as circumstances will admit, be in any of the forms set out in Schedule IX of the Act. A vote given in accordance with the terms of an instrument of proxy shall be valid notwithstanding the previous death or insanity of the principal or revocation of the proxy or of any power of attorney under which such proxy was signed, or the transfer of the share in respect of which the vote is given, provided that no intimation in writing of the death or insanity, revocation or transfer shall have been received at the office before the meeting. No objection shall be made to the validity of any vote except at any meeting or poll at which such vote shall be tendered, and every vote whether given personally or by proxy, not disallowed at such meeting or poll shall be deemed valid for all purposes at such meeting or poll whatsoever. The Chairman of any meeting shall be the sole judge of the validity of every vote tendered at such meeting. The Chairman present at the taking of a poll shall be the sole judge of the validity of every vote tendered at such poll. MINUTES OF MEETING

117.

Form of proxy

118.

Validity of votes given by proxy notwithstanding death of Member

119.

Time for objections of votes

120.

Chairman of any meeting to be the judge of validity of any votes

218


121. (1) The Company shall cause minutes of all proceedings of every General Meeting to be kept by making within thirty days of the conclusion of every such meeting concerned, entries in books kept for that purpose with their pages consecutive numbered. (2) Each page of every book shall be initialed or signed and the last page of the record of proceedings of each meeting in such book shall be dated and signed by the Chairman of the same meeting within the aforesaid period of thirty days or in the event of the death or inability of that Chairman within that period by a Director duly authorised by the Board for the purpose. (3) In no case the minutes of proceedings of meeting shall be attached to any such book as aforesaid by pasting or otherwise. (4) The minutes of each meeting shall contain a fair and correct summary of the proceedings thereat. (5) All appointments of Officer made at any meeting aforesaid shall be included in the minutes of the meeting. (6) Nothing herein contained shall require or be deemed to require the inclusion in any such minutes of any matter which in the opinion of the Chairman of the meeting (a) is, or could reasonably be regarded, as defamatory of any person or (b) is irrelevant or immaterial to the proceedings or (c) is detrimental to the interest of the Company. The Chairman of the meeting shall exercise an absolute discretion in regard to the inclusion or noninclusion of any matter in the minutes on the aforesaid grounds. (7) Any such minutes shall be evidence of the proceedings recorded therein. (8) The book containing the minutes of proceedings of General Meeting shall be kept at the office of the Company and shall be open during business hours, for such periods not being less in the aggregate than two hours in each day as the Directors determine to the inspection of any Member without charge. DIRECTORS *122. Until otherwise determined by a General Meeting of the Company and subject to the provisions of section 252 of the Act, the number of Directors shall not be less than three nor more than twelve. The First Directors of the Company are:(1) Narayanan Suresh Krishnan Number of Director The First Directors Minutes of General Meeting and inspection thereof by Members

123.

219


(2) Arun Mahajan (3) Binayak Datta If it is provided by any Trust Deed, securing or otherwise in connection with any issue of debentures of the Company that any person or persons shall have power to nominate a Director of the Company, then in the case of any and every such issue of debentures, the person or persons having such power may exercise such power from time to time and appoint a Director accordingly. Any Director so appointed as herein is referred to as Debenture Director. A Debenture Director may be removed from office at any time by the person or persons in whom for the time being is vested the power under which he was appointed and another Director may appointed in his place. A Debenture Director shall not be bound to hold any qualification shares. The Board may appoint an Alternate Director to act for a Director (hereinafter called the Original Director) during his absence for a period of not less than three months from the State in which the meetings of the Board are ordinarily held. An alternate director appointed under this Article shall not hold office for a period longer than the permissible to the original Director in whose place he has been appointed and shall vacate office if and when the Original Director return to that State. If the term of Office of the Original director is determined before he so returns to the state, any provisions in the Act or these Articles for the Automatic re-appointment of retiring director in default * Amended vide special resolution passed at the EGM held on 23rd November, 2011 of another appointment shall apply to the original director and not to the Alternate Director. Subject to the provisions of the Act, if a casual vacancy arises on account of death or resignation of any Director, the Director appointed to fill in the casual vacancy shall be a person who shall be nominee of the party who had nominated the Original Director. Any person so appointed shall hold office only up to the date up to which the Director in whose place he is appointed would have held office if it had not vacated by him. Subject to the provisions of Section 260, 261, 262, 264 the Board shall have power at any time and from time to time to appoint any other qualified person to be an Additional Director, but so that the total number of Directors shall not at any time exceed the maximum fixed under Article122 Any such Additional Director shall hold office only up to the date of the next Annual General Meeting. A Director of the Company shall not be bound to hold any qualification shares. (1) Subject to the provisions of the Act, a Managing Director or Director, who is in the whole-time employment of the

124.

Debenture Directors

125.

Appointment of Alternate Director

126.

Directors power to fill vacancies

127.

Directors power to add to the Board

128.

Qualification shares of Directors Remuneration of Directors

129.

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Company, may be paid remuneration either by way of a monthly payment or at a specified percentage of the net profits of the company or partly by one way and partly by the other. (2) Subject to the provisions of the Act, a Director, who is neither in the whole-time employment nor a Managing Director may be paid remuneration either(a) by way of monthly, quarterly or annual payments, or (b) by way of commission if the Company by a special resolution authorises such payment. (3) The fee payable to a Director (including a whole timeDirector & Managing Director, if any) for attending a meeting of the Board & Committee thereof shall be such sum as may be determined by the Board from time to time but not exceeding such sum as may be prescribed by law & by the Central Government from time to time. 130. If any Director be called upon to perform extra services exertions or efforts (which expression shall include work done by a Director as a Member of any Committee formed by the Directors) the Board may arrange with such Director for such special remuneration for such extra services or special exertions or efforts either by a fixed sum or otherwise as may be determined by the Board and such remuneration may be either in addition to or in substitution for his remuneration above provided. The Board may allow and pay to any Director who is not a bona fide resident of the place where the meetings of the Board are ordinarily held and who shall come to such place for the purpose of attending a meeting, such sum as the Board may consider fair compensation for travelling, boarding lodging and other expenses, in addition to his fee for attending such meeting as above specified; and if any Director be called upon to go or reside out of the ordinary place of his residence on the Companys business he shall be entitled to be repaid and reimbursed any travelling or other expenses incurred in connection with business of Company. The continuing Directors may act notwithstanding any vacancy in their body, but if, and so long as their number is reduced below the minimum number fixed by Article122 hereof the continuing Directors not being less than three may act for the purposes of increasing the number of Director to that number or of summoning a General Meeting, but for no other purpose. Subject to sections 283(2) and 314 of the Act the office of a Director shall become vacant if:Special remuneration for extra work

131.

Travelling expenses incurred by Director for attending Meeting or on Companys business

132.

Directors may act notwithstanding any vacancy

133.

When office of Directors to

221


(a) he fails to obtain within the time specified in sub-section (1) of Section 270 of the Act or at any time thereafter cease to hold the share qualification, if any, required of him by these Articles; or (b) he is found to be of unsound mind by a Court of competent jurisdiction; or (c) he applies to be adjudicated as an insolvent; or (d) he is adjudged an insolvent ; or (e) he fails to pay any call made on him in respect of share of the Company held by him whether alone or jointly with others, within six months from the date fixed for the payment of such call unless the Central Government has by notification in the Official Gazette removed the disqualification incurred by such failure; or (f) he is deemed to have vacated office under the provisions of Section 314 by any place of profit being held in contravention thereof; or (g) he absents himself from three consecutive meetings of the Directors or from all meetings of the Directors for a continuous period of three months, whichever is longer, without leave of absence from the Board; or (h) he becomes disqualified by an order of the Court under Section 203 of the Act; or (i) he is removed in pursuance of Section 284 ; or (j) he (whether by himself or by any person for his benefit or on his account) or any firm in which he is a partner or any private Company of which he is director, a loan or any guarantee or security for a loan from the Company in contravention of Section 295 of the Act; or (k) he acts in contravention of Section 299 of the Act; or (l) he is convicted by a Court of an offence involving moral turpitude and is sentenced in respect thereof to imprisonment for not less than six months; or (m) having been appointed a Director by virtue of his holding any office or other employment in the Company, he ceases to hold such office or other employment in the Company; or (n) he resigns his office by a notice in writing addressed to the Company. become vacant

222


(o) he is disqualified pursuant to Section 274(1)(g) of the Act 134. (a) The Company shall keep at its Office a Register containing the particulars of Directors, Managers and other persons mentioned in Section 303 of the Act, and shall otherwise comply with the provisions of the said Section in all respects. (b) The Company shall in respect of each of its Directors also keep at its Office a Register, as required by Section 307 of the Act, and shall otherwise duly comply with the provisions of the said Section in all respects. 135. (1) A Director or his relative, firm in which such Director or relative is a partner, or any other partner in such firm, or a private company of which the Director is a member or director may enter into any contract with the Company for the sale, purchase or supply of any goods, materials or services or for underwriting the subscription of any shares in or debentures of the Company provided that the sanction of the board is obtained before or within three months of the date on which the contract is entered into in accordance with section 297 of the Act. (2) No sanction however shall be necessary for (a) any purchase of goods and materials from the Company or the sale of goods or materials to the Company, by any such Director, relative, firm, partner or private Company as aforesaid for cash at prevailing market prices; or (b) any contract or contracts between the Company on one side and any such Director, relative, firm partner or private company on the other for sale, purchase or supply of any goods, materials and services in which either the Company or the Director, relative, firm, partner or private company, as the case may be, regularly trades or does business, where the value of the goods and materials or the cost of such services do not exceed Rs. 5,000/- in the aggregate in any year comprised in the period of contract or contracts. Provided that in circumstances or urgent necessity, a Director, relative, firm, partner or private company as aforesaid may without obtaining the consent of the Board enter into any such contract with the Company for the sale, purchase or supply of any goods, materials or services exceeds Rs.5,000 in the aggregate in any year comprised in the period of the contract if the consent of the Board shall be obtained to such contract or contracts at a meeting within three months of the date on which the contract was entered into. Directors may contract with Company Register of Directors etc.,

223


136. A Director of the Company who is in any way, whether directly or indirectly concerned or interested in a contract or arrangement, or proposed contract or arrangement entered into or to be entered into by or on behalf of the Company, shall disclose the nature of his concern or interest at meeting of the Board in the manner provided in Section 299(2) of the Act; Provided that it shall be necessary for a Director to disclose his concern or interest in any contract or arrangement entered into with any other Company where any of the Directors of the Company or two or more of them together holds or hold not more than two per cent of the paidup share capital in the other Company. A General Notice given to the Board by the Director, to the effect that he is a director or member of a specified body corporate or is a member of specified firm and is to be regarded as concerned or interested in any contract or arrangement which may, after the date or the notice, be entered into with that body corporate or firm, shall be deemed to be a sufficient disclosure of concern or interest in relation to any contract or arrangement so made. Any such general notice shall expire at the end of the financial year in which it is given but may be renewed for a further period of one financial year at a time by a fresh notice given in the last month of the financial year in which it would have otherwise expired. No such general notice and no renewal thereof shall be of effect unless, either it is given at a meeting of the Board or the Director concerned takes reasonable steps to secure that it is brought up and read at the first meeting of the Board after it is given. The Company shall keep a Register in accordance with section 301(1) of the Act and shall within the time specified in section 301(2) of the Act enter therein such of the particulars as may be relevant having regard to the application thereto of section 297 or section 299 of the Act as the case may be. The Register aforesaid shall also specify, in relation to each Director of the Company the names of the bodies corporate and firms of which notice has been given by him under Article 146. The Register shall be kept at the office of the Company and shall be open to inspection at such office and extracts may be taken there from and copies thereof may be required by any Member of the Company to the same extent, in the same manner and on payment of the same fee as in the case of the Register of Members of the Company and the provisions of Section 163 of the Act shall apply accordingly. A Director may be or become a Director of any Company promoted by the Company, or in which he may be interested as a vendor, shareholder or otherwise and no such Director, shall be accountable for any benefits received as Director or shareholder of such Company except in so far as Section 309(6) or Section 314 of the Act may be applicable. Disclosure of interest

137.

General Notice of interest

138.

Register of Contracts in which Directors are interested.

139.

Directors may be Directors of Companies promoted by the Company

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140. At every Annual General Meeting of the Company, one-third of such of the Directors for the time beings as are liable to retire by rotation or if their number is not three or a multiple of three, the number nearest to one-third shall retire from office. The Debenture Director, if any, shall not be subject to retirement under this clause and shall not be taken into account in determining the rotation of retirement or the number of Directors to retire. Subject to Section 256(2) of the Act, the Directors to retire by rotation under Article 140 at every Annual General Meeting shall be those who have been longest in office since their last appointment, but as between persons who became Directors on the same day, those who are to retire, shall, in default of and subject to any agreement among themselves be determined by lot. A retiring Director shall be eligible for re-election. Subject to Sections 258 and 261 of the Act, the Company at the General Meeting at which a Director retires in manner aforesaid may fill up the vacated office by electing a person thereto. (a) If the place of the retiring Director is not to fill the vacancy, the meeting shall stand adjourned till the same day in the next week, at the same time and place, or if that day is a public holiday till the next succeeding day which is not a public holiday, at the same time and place. (b) If at the adjourned meeting also, the place of the retiring Director is not filled up and that meeting also has not expressly resolved not to fill the vacancy, the retiring Director shall be deemed to have been re-appointed at the adjourned meeting unless:(i) at the meeting or at the previous meeting resolution for the reappointment of such Director has been put to the meeting and lost; the retiring Director has, by a notice in writing addressed to the Company or its Board, expressed his unwillingness to be so reappointed; he is not qualified or he is disqualified for appointment: a resolution, whether special or ordinary, is required for the appointment or re-appointment by virtue of any provisions of the Act; or the proviso to sub-section (2) of section 263 of Retirement and rotation of Directors

141.

Ascertainment of Directors retiring by rotation and filling of vacancies

142. 143.

Eligibility for reelection Company to appoint successors Provision in default of appointment

144.

(ii)

(iii) (iv)

(v)

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the Act is applicable to the case. 145. Subject to Section 258 of the Act the Company may, by Ordinary Resolution, from time to time increase or reduce the number of Directors, and may alter their qualifications, and the Company may (subject to the provisions of Section 284 of the Act) remove any Director before the expiration of his period of office and appoint another qualified person in his stead. The person so appointed shall hold office during such time as the Directors in whose place he is appointed would have held the same if he had not been removed. (a) Every Director (including a person deemed to be a Director by virtue of the explanation to sub-section (1) of section 303 of the Act) Managing Director, Manager or Secretary of the Company shall within twenty days of his appointment to any of the above offices in any other body corporate, disclose to the Company the particulars relating to his office in the other body corporate which are required to be specified under sub-section (1) of Section 303 of the Act. (b) Every Director and every person deemed to be a Director of the Company by virtue of sub-section (10) of Section 307 of the Act, shall give notice to the Company of such matters relating to himself as may be necessary for the purpose of enabling the Company to comply with the provisions of that Section. MANAGING DIRECTORS 147. Subject to the provisions of the Act and of these Articles, the Board shall have power to appoint from time to time any one or more of its number as Managing Director or Managing Directors of the Company for a fixed term not exceeding five years at a time and upon such terms and conditions as the Board thinks fit, and the Board may by resolution, vest in such Managing Director or Managing Directors such of the powers hereby vested in the Board generally as it thinks fit, and such powers may be made exercisable for such period or periods, and upon such conditions and subject to such restrictions as it may determine. The remuneration of a Managing Director may be made by way of monthly payment, fee for each meeting or participation in profits or by any or all these modes or any other mode not expressly prohibited by the Act. The Managing Director or Managing Directors shall not exercise the powers to:(a) make calls on shareholders in respect of money unpaid on the shares in the Company; (b) issue debentures; and except to the extent mentioned in Board may appoint Managing Director or Managing Directors Company may increase or reduce the number of Directors

146.

Disclosure by Director of appointment to any other body corporate

148.

Restriction on management

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the resolution passed at the Board meeting under Section 292 of the Act, shall also not exercise the powers to :(c) borrow moneys otherwise than a debentures; (d) invest the funds of the Company; and (e) make loans. 149. The Company shall not appoint or employ, or continue the appointment or employment of, a person as its Managing or whole-time Director who.(a) is a undischarged insolvent, or has at any time been adjudged an insolvent; (b) suspends or has at any time suspended, payment to his creditors or makes or has at any time made, a composition with them; or (c) is, or has at any time been, convicted by a Court of offence involving moral turpitude. 150. A Managing Director shall not while he continues to hold that office be subject to retirement by rotation, in accordance with Article 140 If he ceases to hold the office of Director he shall ipso facto and immediately cease to be Managing Director. PROCEEDINGS OF THE MEETINGS OF THE BOARD OF DIRECTORS 151. Directors may meet together as a Board for the despatch of business from time to time and shall so meet at least once in every three calendar months and at least four such meetings shall be held in every year. The Directors may adjourn and otherwise regulate their meetings as they think, fit. The board shall be at liberty to conduct meetings either by way of teleconferences or video conferences or other electronic devices, as may be permissible under the Act. In addition, resolutions can be passed by circulation as provided for in the Act. 152. Notice of every meeting of the Board shall be given in writing to all the Directors for the time being in India and at his usual address in India to every other Director. Subject to Section 287 of the Act, the quorum for a meeting of the Board shall be one-third of its total strength (excluding Directors, if any, whose places may be vacant at the time and any fraction contained in that one third being rounded off as one) or two Directors, whichever is higher. Notice of Meetings Quorum Meetings of Directors Special position of Managing Director Certain persons not be appointed Managing Directors

153.

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Where at any time the number of interested Directors exceeds or is equal to two thirds of the total strength the number of the remaining Directors, that is to say, the number of directors who are not interested, present at the meeting being not less than three, shall be the quorum during such time. 154. If a meeting of the board could not be held for want of a quorum, then the meeting shall automatically stand adjourned to such other date and time (if any) as may be fixed by the Chairman not being later than seven days from the date originally fixed for the meeting. Any Director and/or the Secretary shall, as and when directed by Director to do so, convene a meeting of the Board by giving a notice in writing to every Director. The Directors may from time to time elect from among their number a Chairman of the Board and determine the period for which he is to hold office. If at any meeting of the board, the Chairman is not present within fifteen minutes after the time appointed for holding the same, the Directors present may choose any one of their number to be a Chairman of the meeting. Questions arising at any meeting of the Board shall be decided by a majority of votes and in the case of an equality of votes, the Chairman shall have a second or casting vote. A meeting of the Board for the time being at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions which by or under the Act or the Articles of the Company are for the time being vested in or exercisable by the Board generally. Subject to the restrictions contained in Section 292 of the Act, the Board may delegate any of their powers to committees of the Board consisting of such Member or Members of its body as it thinks fit and it may from time to time revoke and discharge any such Committee of the Board either wholly or in part and either as to person or purposes, but every Committee of the Board so formed shall in the exercise of the powers so delegated conform to any regulations that may from time to time be imposed on it by the Board. All acts done by any such Committee of the Board in conformity with such regulations and in fulfillment of the purposes of their appointment but not otherwise, shall have the like force and effect as if done by the Board. Rules governing the functioning and voting requirements of any Committee of the Board shall be established by the Board whenever a Committee is appointed. The meetings and proceeding of any such Committee of the Board consisting of two or more members shall be governed Adjournment of meeting for want of quorum When meeting to be convened Chairman

155.

156.

157.

Questions at Board Meetings, how decided Powers of Board Meeting

158.

159.

Directors may appoint committees

160.

Meeting of Committee, how

228


by the provisions herein contained for regulating the meetings and proceedings of the Directors as far as the same are applicable thereto and are not superseded by any regulations made by the Directors under the last preceding Article. 161. No resolution shall be deemed to have been duly passed by the Board or by a Committee thereof by circulation, unless the resolution has been circulated in draft, together with the necessary papers, if any, to all the Directors or to all the members of the Committee, for the time being in India or their alternates at their respective addresses provided for such purpose and the same has been approved by a majority of Directors or members of the Committee as are then in India. All acts done by any meeting of the Board or by a Committee of the Board or by any person acting as a Director shall, notwithstanding that it shall afterwards be discovered that there was some defect in the appointment of such Director or persons acting as aforesaid or that they or any of them were disqualified or had vacated office or that the appointment of any of them had been terminated by virtue of any provisions contained in the Act or in these Articles, be as valid as if every such person had been terminated by virtue of any provisions contained in the Act or in these Articles, be as valid as if every such person had been duly appointed had not been terminated; provided that nothing in this Article shall be deemed to give validity to acts done by a Director after his appointment has been shown to the Company to be invalid or to have terminated. MINUTES 163. (1) The Company shall cause minutes of all proceedings of every meeting of the Board and Committee thereof to be kept by making within thirty days of the conclusion of every such meeting entries thereof in books kept for that purpose with their pages consecutively numbered. (2) Each page of every such book shall be initialed or signed and the last page of record of proceedings of each meeting in such book shall be dated and signed by the Chairman of the said meeting or the Chairman of the next succeeding meeting. (3) In no case the minutes of proceedings of the meeting shall he attached to any such books as aforesaid by pasting or otherwise. (4) The Minutes of each meeting shall contain a fair and correct summary of the proceedings thereat. (5) All appointments of officers made at any of the meetings aforesaid shall be included in the minutes of the meeting. Minutes of proceedings of Meetings of the Board to be governed

Resolution by circulation

162.

Acts of Board or Committee valid notwithstanding informal appointment

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(6) The minutes shall also contain (a) the names of the Directors present at the meeting and (b) in the case of each resolution passed at the meeting the names of the Directors, if any, dissenting from or not concurring in, the resolution. (7) Nothing contained in sub-clauses (1) to (6) shall be deemed to require the inclusion in any such minutes of any matter which, in the opinion of the Chairman of the meeting:(a) is or could reasonably be regarded as defamatory of any person; (b) is irrelevant or immaterial to the proceedings; or (c) is detrimental to the interest of the Company. The Chairman shall exercise an absolute discretion in regard to the inclusion or non-inclusion of any matter in the minutes on the ground specified in this sub-clause. (8) Minutes of meetings kept in accordance with the aforesaid provisions shall be evidence of the proceedings recorded therein. POWERS OF BOARD OF DIRECTORS 164. The Board may exercise all such powers of the Company and do all such acts things as are not, by the Act, or any other Act or by the Memorandum or by the Articles of the Company required to be exercised by the Company in General Meeting, subject nevertheless to these Articles, to the provisions of the Act or any other Act and to such regulations being not inconsistent with the aforesaid regulations or provisions as may be prescribed by the Company in General Meeting but no regulation made by the Company in General Meeting shall invalidate any prior act of the Board which would have been valid if that regulation had not been made. Without prejudice to the general powers conferred by the last preceding Article and so as not in any way to limit or restrict those powers, and without prejudice to the other powers conferred by these Articles, but subject to the restrictions contained in the last preceding Articles, it is hereby declared that the Directors shall have the following powers, that is to say power:(1) To pay the costs, charges and expenses preliminary and incidental to the promotion, formation, establishment and registration of the Company. Powers of Directors

165.

Certain powers of the Board

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(2) To pay and charge to the capital account of the Company any commission or interest lawfully payable thereon under the provisions of Section 76 and 208 of the Act. (3) Subject to Section 292 and 297 of the Act to purchase or otherwise acquire for the Company any property, rights or privileges which the Company is authorised to acquire, at or for such price or consideration and generally on such terms and conditions as they may think fit; and in any such purchase or other acquisition to accept such title as the Directors may believe or may be advised to be reasonably satisfactory. (4) At their discretion and subject to the provisions of the Act to pay any property, rights, or privileges acquired by or services rendered to the Company, either wholly or partially, in cash or in shares, bonds, debentures, mortgages or other securities of the Company and any such charges may be issued either as fully paid up or with such amount credited as paid up thereon as may be agreed upon; and any such bonds debentures, mortgages or other securities may be either specially charged upon all or any part of the property of the Company and its uncalled capital or not so charged. (5) To secure the fulfillment of any contracts or engagement entered into by the Company by mortgage or charge of all or any of the property of the Company and its uncalled capital for the time being or in such manner as they may think fit. (6) To accept from any member, as far as may be permissible by law, a surrender of his shares or any part thereof, on such terms and conditions as shall be agreed. (7) To appoint any person to accept and hold in trust for the Company any property belonging to the Company, in which it is interested or for any other purposes; and to execute and do all such deeds and things as may be required in relation to any such trust and to provide for the remuneration of such trustee or trustees. (8) To institute, conduct defend, compound or abandon any legal proceedings by or against the Company or its officers or otherwise concerning the affairs of the Company and also to compound and allow time for payment or satisfaction of any debts, due and of any claim or demands by or against the Company add or refer any differences to arbitration and observes and perform any awards made thereon. (9) To act on behalf of the Company in all matters relating to bankrupts and insolvents.

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(10) To make and give receipts, releases and other discharges for money payable to the Company and for the claims and demands of the Company. (11) Subject to the provisions of Sections 292, 295, 369, and 372A of the Act, to invest and deal with any moneys of the Company not immediately required for the purposes thereof upon such security (not being shares of this Company) or without security and in such manner as they may think fit, and from time to time to vary or realize such investments. Save as provided in Section 49 of the Act, all investments shall be made and held in the Companys own name. (12) To determine from time to time who shall be entitled to sign, on the Companys behalf, bills, notes, receipts, acceptances, endorsements, cheques, dividend warrants releases, contracts and documents and to give the necessary authority for such purpose. (13) To distribute by way of bonus amongst the staff of the Company a share or shares in the profits of the Company and to give to any officer or other person employed by the Company a commission on the profits of any particular business or transaction; and to charge such bonus or commission as part of the working expenses of the Company. (14) To provide for the welfare of Directors or ex-Directors or employees or ex-employees of the Company and their wives, widows and families or the dependents of such persons by building or contributing to the building or houses, dwellings or chawls or by grants of money, pension, gratuities, allowances, bonus or other payments or by creating and from time to time subscribing or contributing to provident and other associations, institutions, funds or trusts and by providing or subscribing or contributing towards places of instruction and recreation, hospitals and dispensaries, medical and other attendance and other assistance as the Board shall think fit; and to subscribe or contribute or otherwise to assist or to guarantee money to charitable, benevolent, religious, scientific, national or other institutions or object which shall have any moral or other claim to support or aid by the Company, either by reason of locality of operation or of public and general utility or otherwise. (15) Before recommending any divided, to set aside, out of the profits of the company such sums as they may think proper for depreciation or to Depreciation fund or Sinking Fund or any special fund to meet contingencies or to repay debentures or debenture-stock or for special dividends or for equalising dividends or for repairing,

232


improving, extending and maintaining any of the property of the Company and for such other purpose (including the purposes referred to in the preceding clause), as the Board may, in their absolute discretion, think conductive to the interest of the Company, and subject to section 292 of the Act, to invest the several sums so set aside or so much there of as require to be invested upon such investments (other than shares of the Company) as they may think fit, and from time to time to deal with and vary such investments and dispose of and apply and expend all or any part thereof for the benefit of the Company in such manner and for such purposes as the Board in their absolute discretion, think conductive to the interest of the Company, notwithstanding that the matters to which the Board apply or upon which they expend the same, or any part thereof may be matters to or upon which the capitals moneys of the Company might rightly be applied or expended; and to divide the Reserve Fund into such special funds as the Board may think fit, with full power to transfer the whole or any portion of a Reserve Fund or division of a Reserve Fund to another Reserve Fund or division of Reserve Fund and full power to employ the assets constituting all or any of the above funds, including the Depreciation Funds, in the business of the Company or in the purchase or repayment of debentures or debenture-stock and without being bound to keep the same separate from the other assets and without being bound to pay interest on the same with power, however, to the Board at their discretion to pay or allow to the credit of such funds interest at such rate as the Board may think proper, not exceeding ten per cent per annum. (16) To appoint, and at their discretion remove or suspended such general managers, managers, secretaries, assistants, supervisors, clerks agents and servants for permanent, temporary or special services as they may from time to time think fit, and to determine their powers and duties, and fix their salaries or emoluments or remuneration, and to require security in such instances and to such amount as they may think fit, And also from time to time to provide for the management and transaction of the affairs of the Company in any specified locality in India or elsewhere in such manner as they think fit; and the provision contained in the four next following sub clauses shall be without prejudice to the general powers conferred by this sub clause. (17) To comply with the requirements of any local law which in their opinion it shall in the interest of the Company be necessary or expedient to comply with. (18) From time to time and at any time to establish Local Board for managing any of the affairs of the Company in any specified locality in India or elsewhere and to appoint

233


any person to be Members on such Local Boards and fix their remuneration. (19) Subject to Section 292 of the Act, from time to time, and at any time to delegate to any person so appointed any of the powers, authorities and discretions for the time being vested in the Board, other than their power to make calls or to make loans or borrow moneys, and to authorise the Members for the time being of any such Local Board or any of them to fill up any vacancies therein and to act notwithstanding vacancies and any such appointment or delegation may be made on such terms and subject to such conditions as the Board may think fit, and the Board may at any time remove any person so appointed, and may annul or vary any such delegation. (20) At any time and from time to time by power of Attorney under the seal of the Company to appoint any person or persons to be the Attorney or Attorneys of the company, for such purpose and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Board the power to loan and borrow moneys) and for such period and subject to such conditions as the Board may from time to time think fit; and any such appointment may (if the Board thinks fit) be made in favour of the Members or any of the Members of any Local Board, established as aforesaid or in favour of any company or the shareholders, directors, nominees or managers of any company or firm or otherwise in favour of any fluctuating body of persons whether nominated directly or indirectly by the Board and any such Power of Attorney may contain such powers for the protection or convenience of persons dealing with such Attorneys as the Board may think fit, and may contain powers enabling any such delegates or attorneys as aforesaid to sub delegate all or any of the power authorities and discretions for the time being vested in them. (21) Subject to section 294 and 297of the Act, for or in relation to any of the matters aforesaid or otherwise for the purposes of the Company to enter into all such negotiations and contracts and rescind and vary all such contracts, and execute and do all such acts, deeds and things in the name and behalf of the Company as they may consider expedient. (22) From time to time to make, vary and repeal by laws for the regulation of the business of the company its officers and servants. (23) To execute in the name and on behalf of the Company in favour of any Director or other person who may incur or to be about incur any personal liability whether as principal or surety, for the benefit of the Company, such

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mortgages or the Companys property (present and future)as they think fit: and any such mortgage may contain a power of sale and such other powers, provisions, covenants and agreements and shall be agreed upon.

MANAGEMENT *166. (1) Subject to the provisions of the Act and of these Articles, the Board shall have the power to appoint form time to time either Managing Director/Wholetime Director or a Manager of the Company for a term not exceeding five years at a time upon such terms and conditions as the board thinks fit. The Board may by a resolution vest in the Managing Director/ or Manager such of the powers hereby vested in the Board, generally as it thinks fit, and such powers may be made exercisable for such period as it may determine. The remuneration of the Managing Director/Whole-Time Director or Manager may be by way of monthly payment, fee for each meeting or by way of a specified percentage of the net profits of the Company calculated in the manner laid down in section 349, 350 and 351 or partly by the one way and partly by the other provided that except with the approval of the Central Government such remuneration shall not exceed in the aggregate five percent of net profits for one such Director and if there is more than one such Director, ten percent for all of them together. Provided that the Managing Director/Whole-Time Director so appointed shall not while holding such office, be subject to retirement by rotation or be taken into count in determining the retirement by rotation of Director but this appointment shall be automatically determined if he ceased to be a Director. A Director who is neither in the whole time employment of the Company nor a Managing Director may be paid remuneration either by way of a monthly, quarterly or annual payment with the approval of the Central Government, if any, or by way of commission if the Company by a special resolution authorizes such payment provided that except with the approval of the Central Government, the remuneration paid to such Director, or where there is more than one such Director, to all of them together, shall not exceed 1% of the net profits of the Company, if the Company has a Managing Director and/or a Whole-Time Director or a Manager and 3% of the net profits of the Company in any other case. Prohibition of simultaneous appointment of different categories of managerial personnel

(2)

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THE SECRETARY 167. The Board may from time to time appoint, and, at their discretion, remove any individual, to be the Secretary of the Company and to perform any functions, which by the Act are to be performed by the Secretary, and to execute any other purely ministerial or administrative duties, which may from time to time be assigned to the Secretary by the Board. The Directors may also at any time appoint some person (who need not be the Secretary) to keep the registers to be kept by the Company. Secretary

*Amended vide Special Resolution passed at the Extraordinary General Meeting held on 30th March, 2012 THE SEAL 168. (a) The Board shall provide a Common Seal for the purposes of the Company, and shall have power from time to time to destroy the same and substitute a new Seal in lieu thereof, and the Board shall provide for the safe custody of the Seal for the time being, and the Seal shall never be used except by the authority of the Board or Committee of the Board previously given. (b) The Company shall also be at liberty to have an official Seal in accordance with Section 50 of the Act, for use in any territory, district or place outside India. 169. Every deed or other instrument, to which the Seal of the Company is required to be affixed, shall, unless the same is executed by a duly constituted Attorney, be signed by any two Director or some other person appointed by the Board for the purpose. Provided that in respect of the Share Certificate the Seal shall be affixed in accordance with Article 23 (a). DIVIDENDS 170. The profits of the Company, subject to any special rights relating thereto created or authorised to be created by these Articles and subject to the provisions of these Articles shall be divisible among the Members in proportion to the amount of capital paid-up on the shares held by them respectively. The Company in General Meeting may declare dividends to be paid to Members according to their respective rights, but no dividends shall exceed the amount recommended by the Board, but the Company in General Meeting may declare a smaller dividend. Division of profits Deeds how executed The Seal, its custody and use

171.

The Company in General Meeting may declare a dividend

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172. No dividend shall be declared or paid otherwise than out of profits of the financial year arrived at after providing for depreciation in accordance with the provision of Section 205 of the Act or out of the profits of the Company for any previous financial year or years arrived at after providing for depreciation in accordance with these provisions and remaining undistributed or out of both provided that :(a) if the Company has not provided for depreciation for any previous financial year or years it shall, before declaring or paying a dividend for any financial year, provide for such depreciation out of the profits of the financial year or out of the profits of any other previous financial year or years: (b) if the Company has incurred any loss in any previous financial year or years then the amount of the loss or an amount which is equal to the amount provided for depreciation for that year or those years which ever is less shall be setoff against the profits of the Company for the year for which the dividend is proposed to be declared or paid or against the profits of the Company for any previous financial year or years arrived at in both cases after providing for depreciation in accordance with the provisions of sub-section (2) of section 205 of the act or against both. 173. The Board may, from time to time, pay to the Members such interim dividend as in their judgment the position of the Company justifies. Where Capital is paid in advance of calls, such capital may carry interest but shall not in respect thereof confer a right to dividend or participate in profits. Interim dividend Dividend only to be paid out of profits

174.

Capital paid-up in advance at interest not to earn dividend Dividends in proportion to amount paid-up Retention of dividends until completion of transfer under Article 70 Dividend etc. to joint-holders

175.

The Company shall pay dividends in proportion to the amount paid-up or credited as paid-up on each share, where a larger amount is paid or credited as paid-up on such shares than on others. The Board may retain the dividends payable upon shares in respect of which any person is under Article 70, entitled to become a Member, or which any person under that Article is entitled to transfer until such person shall become a member , in respect of such shares or shall duly transfer the same. Any one of several persons who are registered as the jointholders of any share may give effectual receipts for all dividends or bonus and payments on account of dividends or bonus or other moneys payable in respect of such shares.

176.

177.

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178. No Member shall be entitled to receive payment of any interest or dividend in respect of this share or shares, whilst any money may be due or owing from him to the Company in respect of such share or shares or otherwise howsoever, either alone or jointly with any other person or persons: and the Board may deduct from the interest or dividend payable to any Member all sums of money so due from him to the Company. A transfer of shares shall not pass the right to any dividend declared there on before the registration of the transfer. Unless otherwise directed any dividend may be paid by cheque or warrant or by a pay slip or receipt having the force of a cheque or warrant sent through the post to the registered address of the Member or person entitled or in case of jointholders to that one of them first named in the Register in respect of the Joint-holdings. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent. The Company shall not be liable or responsible for any cheque or warrant or pay slip or receipt lost in transmission, or for any dividend lost to the Member or person entitled thereto by the forged endorsement of any cheque or warrant or the forged signature of any pay slip or receipt or the fraudulent recovery of the dividend by any other means. Unclaimed dividends shall be dealt with in accordance with the provision of sections 205-A 205-B and 205-C or other provision of any of the Act, as may be applicable from time to time. Any General Meeting declaring a dividend may on the recommendation of the Directors make a call on the Members of such amount as the meeting fixes but so that the call on each member shall not exceed the dividend payable to him and so that the call be made payable at the same time as the dividend; and the dividend may, if so arranged between the Company and the Member be set off against the calls. (a) The Company in General meeting may resolve that any money, investments or other assets forming part of the undivided profits of the Company standing to the credit of the Reserve Fund or any Capital Redemption Reserve Account, or in the hands of the Company and available for dividend (or representing premiums received on the issue of shares and standing to the credit of the Shareholders as would be entitled to receive the same if distributed by way of dividend and in the same proportions on the footing that they become entitled thereto as capital and that all or any part of such capitalised fund be applied on behalf of such shareholders in paying up in full either at par or at such premium as the resolution may provide, any unissued No Member to receive dividend whilst indebted to the Company and Companys right to reimbursement thereout. Transfer of shares must be registered Dividends how remitted

179.

180.

181.

Unclaimed dividend

182.

Dividend and call together

183.

Capitalisation

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shares or debentures or debenture-stock of the Company which shall be distributed accordingly or in or towards payment of the uncalled liability on any issued shares or debentures or debenture-stock and that such satisfaction of their interest in the said capitalised sum. Provided that Share Premium Account and a Capital Redemption Reserve Account may, for the purposes of this Article only be applied in the paying up of unissued shares to be issued to Members of the Company as fully paid bonus shares. (b) A General Meeting may resolve that any surplus moneys arising from the realisation of any capital assets of the Company or any investments representing the same, or any other undistributed profits of the Company not subject to charge for income-tax be distributed among the Members on the footing that they receive the same as capital. (c) For the purpose of giving effect to any resolution under the preceding paragraphs of this article the Board may settle any difficulty which may arise in regard to the distribution as it thinks expedient and in particular may issue fractional certificates, and may fix the value for distribution of any specific assets, and determine that such cash payments of any specific asset, and may determine that such cash payments shall be made to any Members upon the footing of the value so fixed or that fraction of less value than Rs 10/ - may disregarded in order to adjust the rights of all parties, and may vest any such cash or specific assets in trustees upon such trusts for upon such trusts for the person entitled to the dividend or capitalized fund as may seem expedient to the Board. Where requisite, a proper contract shall be delivered to the Registrar for registration in accordance with Section 75 of the Companies Act, 1956 and the Board may appoint any person to sign such contract on behalf of the persons entitled to the dividend or capitalised fund, and such appointment shall be effective. ACCOUNTS 184. The Company shall keep at the office or at such other place in India as the Board thinks fit proper books of Account in accordance with Section 209 of the Act with respect to, (a) all sums of moneys received and expended by the Company and the matters in respect of which the receipts and expenditure take place; (b) all sales and purchases of goods by the Company; (c) the assets and liabilities of the Company. Directors to keep true accounts

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Where the Board decides to keep all or any of the Books of Accounts at any place other than the office of the company, the Company shall within seven days of the decision file with the Registrar a notice in writing giving the full address of that other place. The Company shall preserve in good order the Books of Accounts relating to a period of not less than eight years preceding the current year together with the vouchers relevant to any entry in such books of account. Where the Company has a branch office, whether in or outside India, the Company shall be deemed to have complied with this Article if proper Books of Account relating to the transactions effected at the branch office are kept at the branch office and proper summarised returns, made up to date at intervals of not more than three months, are sent by the branch office to the Company at its office or other place in India, at which the Companys Books of Account are kept as aforesaid. The Books of Account shall give a true and fair view of the state of affairs of the Company or branch office, as the case may be, and explain its transactions. The books of Account and other books and papers shall be open to inspection by any Director during business hours. 185. The Board shall from time to time determine whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspections of Members not being Directors, and no Members (not being a Director) shall have any right of inspecting any account or books or document of the Company except as conferred by law or authorised by the Board. The Directors shall from time to time, in accordance with Sections 210, 211, 215, 216 and 217 of the Act, cause to be prepared and to be laid before the Company in General Meeting, such Balance Sheets, Profit and Loss Accounts and Reports as are required by these sections. A copy of every such Profit and Loss Account and Balance Sheet (including the Auditors Report and every other document required by law to be annexed or attached to the Balance Sheet), shall at least twenty-one days before the Meeting at which the same are to be laid before the Members, be sent to the Members of the Company; to holders of debentures issued by the Company (not being debentures which exfacie are payable to the bearer thereof), to trustees for the holders of such debentures and to all persons entitled to receive notice of General Meetings of the Company. AUDIT As to inspection of accounts or books by members

186.

Statement of accounts to be furnished to General Meeting Copies shall be sent to each Member

187.

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188. 189.

Auditors shall be appointed and their rights and duties regulated in accordance with sections 224 to 233 of the Act. The First Auditor of the Company shall be appointed by the Board within one month of the date of registration of the company and the Auditor or Auditors so appointed shall hold office until the conclusion of the First Annual General Meeting provided that the Company may at a General Meeting remove any such Auditors or all such Auditors and appoint in his or their place any Member of the Company and of whose nomination notice has been given to the Members of the Company not less than fourteen days before the date of the Meeting provided further that if the Board fails to exercise its powers under this Article, the Company in General Meeting may appoint the first Auditor or Auditors. DOCUMENTS AND NOTICE

Accounts to be audited First Auditor or Auditors

190.

(1) A document or notice may be served or given by the Company to any Member personally or by sending it by post to him to his registered address or (if he has no registered address in India) to the address if any, in India supplied by him to the Company for serving document or notices on him. (2) Where a document or notice is sent by post, service of the document or notice shall be deemed to be effected by properly addressing, prepaying and posting a letter containing the document or notice, provided that where a Member has intimated to the Company in advance that documents or notices should be sent to him under a certificate of posting or by registered post with or without acknowledgment due and has deposited with the Company a sum sufficient to defray the expenses of doing so, service of the document or notice shall not be deemed to be effected unless it is sent in the manner intimated by the Member and, such service shall be deemed to have been effected in the case of a Notice of a meeting, at the expiration of forty-eight hours after the letter containing the document or notice is posted and in any other case, at the time at which the letter would be delivered in the ordinary course of post.

Services of documents or notices on Members by Company

191.

A document or notice advertised in newspaper circulating in the neighborhood of the office shall be deemed to be duly served or sent on the day on the which the advertisement appears on or to every Member who has no registered address in India and has not supplied to the company an address within India for the serving of documents on or the sending of notices to him.

By Advertisement

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192. A document or notice may be served or given by the Company on or to the Joint-holders of a share by serving or giving the document or notice on or to the joint- holder named first in the Register of Members in respect of the share. A document or notice may be served or given by the Company on or to the person entitled to a share in consequence of the death or insolvency of a Member by sending it through the post in pre- paid letter addressed to them by name or by the title of representative of the deceased, or assignee of the insolvent or by any like description, at the address (if any) in India supplied for the purpose by the persons claiming to be so entitled, or (until such an address has been so supplied by serving the document or notice in any manner in which the same might have been given if the death or insolvency had not occurred). Document or notices of every General Meeting shall be served or given in same manner hereinbefore authorised on or to (a) every Member, (b) every person entitled to a share in consequence of the death or insolvency of a Member, and (c) the Auditor or Auditors for the time being of the Company. Every person who, by operation of law, transfer or other means whatsoever, shall become entitled to any share shall be bound by every document or notice in respect of such share which previously to his name and address being entered on the Register of Members, shall have been duly served on or given to the person from whom he derives his title to such shares. Any document or notice to be served or given by the Company may be signed by a Director or some person duly authorised by the Board of Directors for such purpose and the signature thereto may be written, printed or lithographed. All documents or notices to be served or given by Members on or to the Company or any officer thereof shall be served or given by sending it to the Company or officer at the office by post under a certificate of posting or by registered post or by leaving it at the office. On Joint-holders

193.

On Personal representatives etc.

194.

To whom document or notices must be served or given Members bound by documents or notices served on or given to previous holders Document or notice by company and signature thereto Service of document of notice by Member

195.

196.

197.

WINDING-UP 198. Upon the winding up of the Company, the holders of Preference Shares, if any, shall be entitled to be paid all arrears of Preferential dividend to the commencement of the winding up and also to be repaid the amount of capital paid up or credited as paid up on such preference shares held by them respectively, in priority of the equity shares, but shall not be entitled to any other further rights to participate in Distribution of Assets.

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profits or assets; subject as aforesaid and to the rights of any other holders of the shares entitled to receive preferential payment over the equity shares, in the event of the winding up of the Company, the holders of the equity shares shall be entitled to be re-paid the amount of capital paid up or credited as paid up on such shares and all surplus assets thereafter shall belong to the holders of the in proportion to the amount paid up or credited as paid up on such equity shares respectively, at the commencement of the winding up. If the assets shall be in-sufficient to repay the whole of the paid up equity capital, such assets shall be distributed so that as nearly as may be the losses shall be born by the members holding equity shares in proportion to the capital paid up of which ought to have been paid up on the equity shares held by them respectively at the commencement of the windingup, other than the amounts paid by them in advance of calls. 199 The Liquidator on any winding-up (whether voluntary, under supervision or compulsory) may, with the sanction of a Special Resolution, but subject to the rights attached to any preference share capital, divide among the contributories in specie any part of the assets of the Company and may with the like sanction, vest any part of the assets of the Company and may with the like sanction, vest any part of the assets of the Company in trustees upon such trusts for the benefits of the contributories as the Liquidator, with the like sanction shall think fit. INDEMNITY AND RESPONSIBILITY 200. Every officer or Agent for the time being of the Company shall be indemnified out of the assets of the Company against all liability incurred by him in defending any proceedings whether civil or criminal, in which judgment is given in his favour or in which he is acquitted or discharged or in connection with any application under section 633 of the Act in which relief is granted to him by the Court. Directors and others right of indemnity Liquidator may divide assets in specie

SECRECY CLAUSE

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201. (a) Every Director, Manager, Auditor, Treasurer, Trustee, member of a Committee, officer, servant, agent, accountant or other person employed in the business of the Company shall, if so required by the Director, before entering upon his duties, sign a declaration and affairs of the Company with the customers and the state of the accounts himself not to reveal any of the matters which may come to his knowledge in the discharge of his duties except when required so to do by the Directors or by law or by the person to whom such matters relate and except so far as may be necessary in order to comply with any of the provisions in these presents contained. (b) No Member shall be entitled to visit or inspect any works of the Company without the permission of the Directors or to require discovery of or any information respecting any details of the Companys trading, or any matter which is or may be in the nature of a trade secret, mystery of trade, secret process or any other matter which may relate to the conduct of the business of the Company and which in the opinion of the Directors, it would be inexpedient in the interest of the Company to disclose. Secrecy clause

We the several persons whose names and addresses are subscribed hereto are desirous of being formed into a Company in pursuance of this Articles of Association. Sr. No. 1. Name, Fathers name, Address, Description, Occupation and signature of each Subscriber SD/RMKRISHNA YESHWANTRAO PATIL S/O YESHWANTRAO L. PATIL B-4, ZUARI RESIDENTIAL COLONY ZUARINAGAR -403 726 SERVICE SD/BINAYAK DATTA S/O SHRI BHAVANI KRISHNA DATTA B-2, ZUARI COLONY ZUARINAGAR, GOA-403726 SERVICE SD/BALASAHEB KALLAPPA KINEKAR S/O KALLAPPA Y. KINEKAR 306, DEVARSHI HOUSING SOCIETY MANGOR HILL VASCO-DA-GAMA, GOA 403 802 SERVICE SD/NAVEEN K. KAPOOR S/O DURGA PRASAD KAPOOR Name, Fathers name, Address, Description, Occupation and signature of Witness

2.

3.

4.

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SD/SADASHIV V SHET SON OF VASUDEV GOVIND SHET S-15 JAIRAM COMPLEX NEVGINAGAR PANAJI GOA COMPANY SECRETARY

WITNESS TO SR. NO. 1 TO 7


B-6, ZUARI IND COLONY ZUARINAGAR, GOA-403726 SERVICE SD/RAJU VASANT PATIL S/O VASANT PATIL D-1 SALKAR ESSEN APTS., ADARSHANAGAR, CHICALAM SERVICE SD/HARSHAD CHANDRAKANT SHAH S/O CHANDRAKANT P. SHAH 7/UG-10, KAMAT CLASIC IV CARANZELAM PANJIM, GOA 403 002 SERVICE SD/NITIN MANGUESH KANTAK S/O MANGUESH KANTAK B-5, ZUARI COLONY ZUARINAGAR, GOA-403726 SERVICE

5.

6.

7.

ZUARI INVESTMENTS LIMITED R. Y. PATIL AUTHORISED SIGNATORY JAI KISAAN BHAWAN, ZUARINAGAR, GOA-403726. COMPANY

PLACE:ZUARINAGAR DATE: 28.08.2009

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XVII. DOCUMENTS FOR INSPECTION a) MoA and AoA of the Company along with Certificate of Incorporation and Certificate of Commencement of Business issued by the Registrar of Companies, Goa, Daman and Diu. b) Order of the High Court of Bombay at Goa dated March 2, 2012 sanctioning the Scheme of Demerger. c) Copy of the letters issued by NSE and BSE dated June 10th, 2011 and June 21st, 2011, respectively, according their no objection to the Scheme of Demerger. d) Return of Allotment filed by the Company for allotment of Equity Shares pursuant to the Scheme of Demerger. e) Copy of the Tripartite Agreement entered into by the Company with the Registrar & Transfer Agent and NSDL. f) Copy of the Tripartite Agreement entered into by the Company with the Registrar & Transfer Agent and CDSL. g) Memorandum of Understanding with the Registrar & Share Transfer Agent. h) Annual Report containing the audited accounts of the Company as on March 31, 2011. i) Annual Report containing the audited accounts of the Company as on March 31, 2012. j) SEBI letter no. CFD/DIL/HB/EK/22648/2012 dated October 09, 2012 granting relaxation from the applicability of Rule 19(2) (b) of the SCRR for listing of the Equity Shares. k) Copy of In-Principal Approval granted by BSE and NSE for listing of the Equity Shares dated 21st June, 2012 and 04th July, 2012 respectively.

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DECLARATION No statement made in this Information Memorandum contravenes any of the provisions of the Companies Act, 1956 and the rules made thereunder. All the legal requirements connected with the said issue as also the guidelines, instructions etc. issued by SEBI, Government and any other competent authority in this behalf have been duly complied with. All the information contained in this document is true and correct. On behalf of the Board of Directors of Zuari Agro Chemicals Limited

sd/Name: Mr. Jayant Godbole Designation: Director

sd/Name: Mr. R Y Patil Designation: Company Secretary

Place: Mumbai Date: 21 November, 2012

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