18 Gold Flake Final - ITC Limited · 25th August, 2015 14th December, 2015 8th March, 2016 Audit Committee 4 29th April, 2015 25th August, 2015 14th December, 2015 8th March, 2016

216

gold flake corporation limited

1. Your Directors submit their Report for the financial year ended31stMarch,2016.

2. COMPANY PERFORMANCE

YourCompany earned total revenueof` 341.73 lakhsduring theyearunderreview.Inviewoftheuncertaintyinthepresentbusinessenvironment, theCompanyhasnot contracted any freshbusinessduringtheyearandcontinuestoexploregrowthopportunities.Thetemporary surplus funds of the Company, in themeantime, havebeendeployedinbankfixeddeposits.

ThefinancialresultsofyourCompany,summarised,areasunder:

For the year ended Fortheyearended 31st March, 2016 31stMarch,2015 (`) (`)

a.ProfitBeforeTax 2,92,80,161 3,97,00,486

b.Less:TaxExpense 28,99,331 63,50,000

c.ProfitAfterTax 2,63,80,830 3,33,50,486

d.Add:Profitbrought forwardfrompreviousyears 3,51,16,229 17,45,39,833

e.Surplusavailablefor Appropriation 6,14,97,059 20,78,90,319

f. Less:InterimDividendpaid (recommendedasFinalDividend) – 14,39,85,465

g.Less:IncomeTaxon InterimDividend – 2,87,88,625

h.Balancecarriedforward 6,14,97,059 3,51,16,229

3. DIRECTORS AND KEY MANAGERIAL PERSONNEL

(a) Changes in Directors and Key Managerial Personnel during the year

Duringtheyear,therewasnochangeinthecompositionoftheBoardofDirectorsofyourCompany(‘theBoard’).

The Board, on the recommendation of theNomination andRemunerationCommittee,re-appointedMs.NidhiBajajastheManageroftheCompanyfrom1stOctober,2015,intermsoftheprovisionsofSections196and203oftheCompaniesAct,2013 (‘theAct’), subject to the approvalof theMembersoftheCompany.AppropriateresolutionseekingyourapprovaltoMs.Bajaj’sre-appointmentasManagerisappearingintheNoticeconveningtheensuingAnnualGeneralMeeting(‘AGM’)oftheCompany.Ms.BajajisalsotheCompanySecretaryoftheCompany.

(b) Retirement by rotation

InaccordancewiththeprovisionsofSection152(6)oftheAct,Mr.R.Tandon(DIN:00042227),Director,willretirebyrotationattheensuingAGMoftheCompanyand,beingeligible,offershimself for re-election. Your Board has recommended hisre-election.

(c) Declaration of Independence by Independent Directors

TheIndependentDirectorsofyourCompanyhaveconfirmedthattheymeetthecriteriaofIndependenceasprescribedunderSection149(6)oftheActreadwithRule5oftheCompanies(AppointmentandQualificationofDirectors)Rules,2014.

(d) Attributes, qualifications and appointment of Directors

As reported last year, the attributes andqualificationsof theIndependentDirectorsasprovidedinSection149(6)oftheActandRule5oftheCompanies(AppointmentandQualificationof Directors) Rules, 2014 were adopted by the Nominationand Remuneration Committee. The said attributes andqualifications, as applicable,were also adopted in respect oftheotherDirectors.

TheDirectors of the Company, other than the IndependentDirectors,areexecutivesofITCLimited,theHoldingCompany,and fulfil the fit and proper criteria for appointment asDirectors. Further, theDirectorsof theCompany,other thanthe Independent Directors, are liable to retire by rotationand one-third of them retire every year and are eligible forre-election.

(e) Remuneration Policy

The Remuneration Policy of the Company for theDirectors,KeyManagerialPersonnelandotheremployees,asapprovedbytheBoard,isenclosedasAnnexure 1tothisReport.

REPORT OF THE bOARD OF DIRECTORS FOR THE FINANCIAL YEAR ENDED 31ST MARCH, 2016

4. bOARD AND bOARD COMMITTEES

ThetwoBoardCommitteesoftheCompanyandtheircompositionisasfollows:

Audit Committee Nomination and Remuneration Committee

Mr.R.Tandon(Chairman) Mr.B.B.Chatterjee(Chairman)

Mr.S.Banerjee Mr.S.Banerjee

Ms.A.Guhamallick Ms.A.Guhamallick

Mr.R.Tandon

Duringtheyearended31stMarch,2016,thefollowingmeetingsoftheBoardandBoardCommitteeswereheld:

board / board Committee Number of meetings

Date(s) of meeting(s)

Board 4 29thApril,201525thAugust,201514thDecember,20158thMarch,2016

AuditCommittee 4 29thApril,201525thAugust,201514thDecember,20158thMarch,2016

Nomination and RemunerationCommittee

3 29thApril,201525thAugust,20158thMarch,2016

The attendance of Directors of the Company at the Board and BoardCommitteemeetingsheldduringtheyearisgivenbelow:

Sl. No.

Name of the Director Number of meetings attended

board Audit Committee

Nomination and

Remuneration Committee

1. Mr.R.Tandon 4 4 3

2. Mr.S.Banerjee 4 4 3

3. Mr.B.B.Chatterjee 4 N.A. 3

4. Mr.SaradinduDutta 3 N.A. N.A.

5. Ms.A.Guhamallick 4 4 3

5. DIRECTORS’ RESPONSIbILITY STATEMENT

AsrequiredunderSection134(5)oftheAct,yourDirectorsconfirmhaving:

i) followed in the preparation of the Annual Accounts, theapplicable Accounting Standards with proper explanationrelatingtomaterialdepartures,ifany;

ii) selectedsuchaccountingpoliciesandappliedthemconsistentlyandmade judgementsandestimates thatare reasonableandprudentsoastogiveatrueandfairviewofthestateofaffairsoftheCompanyattheendofthefinancialyearandoftheprofitoftheCompanyforthatperiod;

iii) taken proper and sufficient care for the maintenance ofadequateaccountingrecordsinaccordancewiththeprovisionsoftheActforsafeguardingtheassetsoftheCompanyandforpreventinganddetectingfraudandotherirregularities;

iv) preparedtheAnnualAccountsonagoingconcernbasis;and

v) devisedpropersystemstoensurecompliancewiththeprovisionsofallapplicablelawsandthatsuchsystemsareadequateandoperatingeffectively.

6. ASSOCIATE AND JOINT VENTURE

The statement in Form No. AOC-1 containing the salient featuresof thefinancial statementsofATCLimited,associatecompany,andITC Essentra Limited, joint venture company, is attached to theFinancialStatementsoftheCompany.

The Company, being an intermediate wholly owned subsidiary, isnot required to prepare Consolidated Financial Statements, andaccordingly report on the performance and financial position oftheCompany’sassociateandjointventureintermsofRule8oftheCompanies(Accounts)Rules,2014isnotrequiredtobeprovided.

217


7. PARTICULARS OF EMPLOYEES

None of the employees of the Company is drawing remunerationexceedingthatspecifiedinRule5(2)oftheCompanies(AppointmentandRemunerationofManagerialPersonnel)Rules,2014.

8. RISK MANAGEMENT

The Company’s risk management framework, designed to bringrobustness to the risk management processes in the Company,addresses risks intrinsic to operations, financials and compliancesarisingoutoftheoverallstrategyoftheCompany.

Managementofrisksvestswiththeexecutivemanagementwhichisresponsiblefortheday-to-dayconductoftheaffairsoftheCompany.TheInternalAuditDepartmentofITCLimitedperiodicallycarriesout,attherequestoftheCompany,riskfocusedauditswiththeobjectiveof identifying areas where risk management processes could bestrengthened. Annual update is provided to the Audit CommitteeontheeffectivenessoftheCompany’sriskmanagementsystemsandpolicies.

9. INTERNAL FINANCIAL CONTROLS

Your Company has in place adequate internal financial controlswith respect to the financial statements, commensurate with itssize and scale of operations. The Internal Audit Department ofITCLimitedperiodicallyevaluatestheadequacyandeffectivenessofsuchinternalfinancialcontrols.TheAuditCommitteewhichprovidesguidanceoninternalcontrols,alsoreviewsinternalauditfindingsandimplementationofinternalauditrecommendations,ifany.

Duringtheyear,theinternalfinancialcontrolsintheCompanywithrespect to the financial statements were tested and no materialweaknessinthedesignoroperationofsuchcontrolswasobserved.Nonetheless your Company recognises that any internal financialcontrol framework, no matter how well designed, has inherentlimitationsandaccordingly,regularauditandreviewprocessesensurethatsuchsystemsarereinforcedonanongoingbasis.

10. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

Duringtheyearended31stMarch,2016,theCompanyhasneithergiven any loan or guarantee nor has made any investment underSection186oftheAct.

11. RELATED PARTY TRANSACTIONS

Duringtheyearended31stMarch,2016,theCompanyhasneitherentered into any contract or arrangement with its related partieswhichisnotatarm’slengthnorhastheCompanyenteredintoanymaterialcontractorarrangementwiththem,intermsofSection188oftheAct.

12. SIGNIFICANT AND MATERIAL ORDERS PASSED bY THE REGULATORS / COURTS / TRIbUNALS

Duringtheyearunderreview,nosignificantormaterialorderswerepassedby the Regulators /Courts / Tribunals impacting the goingconcernstatusoftheCompanyanditsfutureoperations.

13. EXTRACT OF ANNUAL RETURN

TheextractofAnnualReturn in theprescribedFormNo.MGT-9 isenclosedasAnnexure 2tothisReport.

14. AUDITORS

The Company’s Auditors, Messrs. L. B. Jha & Co., CharteredAccountants (‘LBJ’), were appointed with your approval at theEightiethAGMtoholdsuchofficetill theconclusionoftheEighty-FifthAGM.YourBoard,intermsofSection139oftheAct,hasrecommendedfortheratificationoftheMemberstheappointmentofLBJfromtheconclusionoftheensuingAGMtilltheconclusionoftheEighty-ThirdAGM.TheBoard,intermsofSection142oftheAct,hasalsorecommendedfortheapprovaloftheMemberstheremunerationofLBJforthefinancialyear2016-17.AppropriateresolutioninrespectoftheaboveisappearingintheNoticeconveningtheensuingAGMoftheCompany.

15. CONSERVATION OF ENERGY, TECHNOLOGY AbSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

ConsideringthenatureofbusinessofyourCompany,nocommentisrequiredonconservationofenergyandtechnologyabsorption.

Therehasbeennoforeignexchangeearningsoroutflowduringtheyearunderreview.

OnbehalfoftheBoard

R.Tandon ChairmanDated:2ndMay,2016 SaradinduDutta Director

Annexure 1 to the Report of the Board of Directors for the financial year ended 31st March, 2016

Remuneration Policy

(Aligned to the Remuneration Policy of ITC Limited, the Holding Company)

TheCompany’sRemunerationStrategy isdesignedtoattractandretainqualitytalentthatgives itsbusinessacompetitiveadvantageandenablestheCompanytoachieveitsobjectives.

TheCompany’sRemunerationStrategy,whilstfocusingonremunerationandrelatedaspectsofperformancemanagement,isalignedwithandreinforcestheemployeevaluepropositionofasuperiorqualityofworklife,thatincludesanenablingworkenvironment,anempoweringandengagingworkcultureandopportunitiestolearnandgrow.

TheCompensationapproachendeavourstoaligneachemployeewiththeCompany’sgoals.

POLICY

ItistheCompany’sPolicy:1. ToensurethatitsRemunerationpracticessupportandencouragemeritocracy.2. ToensurethatRemunerationismarket-ledandtakesintoaccountthecompetitivecontextoftheCompany’sbusiness.3. ToleverageRemunerationasaneffectiveinstrumenttoenhanceperformanceandthereforetolinktheremunerationtobothindividualandcollective

performanceoutcomes.4. ToadoptacomprehensiveapproachtoRemunerationinordertosupportasuperiorqualityofpersonalandworklife,inamannersoastojudiciously

balanceshorttermwithlongtermpriorities.5. TodesignRemunerationpracticessuchthattheyreinforcetheCompany’svaluesandcultureandtoimplementtheminamannerthatcomplieswith

allrelevantregulatoryrequirements.Remuneration of Key Managerial Personnel (KMP)1. RemunerationofKMPisdeterminedandrecommendedbytheNominationandRemunerationCommitteeandapprovedbytheBoard.Remuneration

oftheManagingDirector/WholetimeDirector/Managerisalsosubjecttotheapprovaloftheshareholders.2. Remunerationisreviewedandrevisedperiodically,whensucharevisioniswarrantedbythemarket.3. Apart fromfixedelementsof remuneration andbenefits, theKMPare also eligible forVariable Pay / PerformanceBonuswhich is linked to their

individualperformance.4. RemunerationofKMPondeputationfromtheHoldingCompany/subsidiary/fellowsubsidiary/associatecompanies,isalignedtotheRemuneration

Policyofthatcompany.Remuneration of Independent Directors IndependentDirectorsareentitledtosittingfeesforattendingmeetingsoftheBoardandBoardCommittees,thequantumofwhichisdeterminedbytheBoardwithinthelimitsprescribedundertheCompaniesAct,2013andtheRulesthereunder.IndependentDirectorsarealsoentitledtoreimbursementofexpensesforattendingmeetingsoftheBoardandBoardCommitteesandGeneralMeetings.Remuneration of employees other than KMP1. RemunerationofemployeesotherthanKMPisapprovedbytheBoard.2. Remunerationisreviewedandrevisedperiodically,whensucharevisioniswarrantedbythemarket.Thequantumofrevisionislinkedtomarkettrends,

thecompetitivecontextoftheCompany’sbusiness,aswellasthetrackrecordoftheindividualemployee.3. VariablePayisbasedontheperformanceratingoftheindividualemployee.

218


Annexure 2 to the Report of the board of Directors

FORM NO. MGT-9

EXTRACT OF ANNUAL RETURN

as on the financial year ended on 31st March, 2016

[Pursuant to Section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS

i) CIN : U16003WB1935PLC008314

ii) RegistrationDate : 26thJune,1935

iii) NameoftheCompany : GoldFlakeCorporationLimited

iv) Category/Sub-CategoryoftheCompany : UnlistedPublicCompanylimitedbyshares

v) AddressoftheRegisteredofficeandcontactdetails : VirginiaHouse

37J.L.NehruRoad

Kolkata–700071

Phone:03322884086/6228/1946

Fax:03322889980

e-mailID:[email protected]

vi) Whetherlistedcompany : No

vii) Name,AddressandContactdetailsofRegistrarandTransferAgent,ifany : N.A.

II. PRINCIPAL bUSINESS ACTIVITIES OF THE COMPANY

Allthebusinessactivitiescontributing10%ormoreofthetotalturnoveroftheCompanyshallbestated:NOTAPPLICABLE

III. PARTICULARS OF HOLDING, SUbSIDIARY AND ASSOCIATE COMPANIES

Sl. No.

Name and address of the company CIN / GLN Holding / Subsidiary / Associate

% of shares held in / by the Company

Applicable Section

1 ITCLimitedVirginiaHouse37JawaharlalNehruRoadKolkata–700071

L16005WB1910PLC001985 Holdingcompany 100.00% 2(46)

2. ITCEssentraLimitedSurveyNo.29&30,DoddajalaPost,YarthiganahalliBettahalasurPostBengaluru–562157

U85110KA1993PLC014278 Jointventurecompany 50.00% 2(6)

3. ATCLimited

35RajajiNagar

Hosur–635126

U16000TZ1973PLC018100 Associatecompany 47.50% 2(6)

IV. SHAREHOLDING PATTERN (Equity Share Capital breakup as percentage of Total Equity)

(i) Category-wise Shareholding:

Category of Shareholders No. of Shares held at the beginning of the year No. of Shares held at the end of the year % Change during

the year

Demat Physical Total % of Total Shares


A. Promoters

(1) Indian

a)Individual/HUF

b)CentralGovt.

c)StateGovt.(s)

d)BodiesCorp.

e)Banks/FI

f)AnyOther

–

–

–

–

–

–

–

–

–

1,59,98,385

–

–

–

–

–

1,59,98,385

–

–

–

–

–

100.00

–

–

–

–

–

–

–

–

–

–

–

1,59,98,385

–

–

–

–

–

1,59,98,385

–

–

–

–

–

100.00

–

–

N.A.

N.A.

N.A.

Nil

N.A.

N.A.

Sub-total (A)(1) – 1,59,98,385 1,59,98,385 100.00 – 1,59,98,385 1,59,98,385 100.00 Nil

(2) Foreign

a)NRIs–Individuals

b)Other–Individuals

c)BodiesCorp.

d)Banks/FI

e)AnyOther

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

N.A.

N.A.

N.A.

N.A.

N.A.

Sub-total (A)(2) – – – – – – – – N.A.

Total shareholding of Promoter (A) = (A)(1)+(A)(2)

– 1,59,98,385 1,59,98,385 100.00 – 1,59,98,385 1,59,98,385 100.00 Nil

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Category of Shareholders No. of Shares held at the beginning of the year No. of Shares held at the end of the year % Change during

the year



b. Public Shareholding

1.Institutions

a)MutualFunds

b)Banks/FI

c)CentralGovt.

d)StateGovt.(s)

e)VentureCapitalFunds

f)InsuranceCompanies

g)FIIs

h) ForeignVentureCapitalFunds

i)Others(specify)

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

N.A.

Sub-total (b)(1) – – – – – – – – N.A.

2.Non-Institutions

a)BodiesCorp.

i)Indian

ii)Overseas

b)Individuals

i)Individualshareholdersholdingnominalsharecapitalupto ` 1lakh

ii)Individualshareholdersholdingnominalsharecapitalinexcessof`1lakh

c)Others(specify)

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

N.A.

N.A.

N.A.

N.A.

N.A.

Sub-total (b)(2) – – – – – – – – N.A.

Total Public Shareholding (b)=(b)(1) + (b)(2)

– – – – – – – – N.A.

C.SharesheldbyCustodianforGDRs&ADRs

– – – – – – – – N.A.

Grand Total (A+b+C) – 1,59,98,385 1,59,98,385 100.00 – 1,59,98,385 1,59,98,385 100.00 Nil

(ii) Shareholding of Promoters:

Sl. No.

Shareholder’s Name

Shareholding at the beginning of the year Shareholding at the end of the year % change in shareholding

during the yearNo. of Shares % of total Shares of the Company

% of Shares pledged /

encumbered to total Shares

No. of Shares % of total Shares of the Company

% of Shares pledged /

encumbered to total Shares

1. ITCLimited 1,59,98,385 100.00 Nil 1,59,98,385 100.00 Nil Nil

(iii) Change in Promoters’ Shareholding (please specify, if there is no change):

Sl. No.

Shareholding at the beginning of the year Cumulative Shareholding during the year



Atthebeginningoftheyear

No change during the yearDate wise Increase / Decrease inPromotersShareholdingduringtheyear

Attheendoftheyear

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):NOTAPPLICABLE

(v) Shareholding of Directors and Key Managerial Personnel:NoneoftheDirectorsandKeyManagerialPersonnelholdanyshareintheCompanyintheirindividualcapacity.

V. INDEbTEDNESS

Indebtedness of the Company including interest outstanding / accrued but not due for payment :NIL

SHAREHOLDING PATTERN (Equity Share Capital breakup as percentage of Total Equity) (Contd.)

220


VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to Managing Director, Wholetime Directors and / or Manager: (Amountin`)

Sl. No.

Particulars of Remuneration N. bajaj(Manager &

Company Secretary)(refer Note 1)

1. GrossSalary(a)SalaryasperprovisionscontainedinSection17(1)oftheIncome-taxAct,1961 17,94,772

(b)ValueofperquisitesunderSection17(2)oftheIncome-taxAct,1961 72,400(c)ProfitsinlieuofsalaryunderSection17(3)oftheIncome-taxAct,1961 –

2. StockOption –3. SweatEquity –4. Commission

-as%ofprofit-others,specify

–

5. Others,pleasespecify –Total Amount (A) 18,67,172CeilingaspertheCompaniesAct,2013 42,00,000perannum

(refer Note 2)

Note 1 : Ms. N. Bajaj was on the rolls of the Company till 30th September, 2015 and is on deputation from ITC Limited with effect from 1st October, 2015.

Note 2 : Ceiling as per Part II of Schedule V to the Companies Act, 2013 has been disclosed, considering that the profits of the Company for the financial year ended 31st March, 2016 are inadequate.

b. Remuneration to other Directors: (Amountin`)

Sl. No.

Name of the Directors Particulars of Remuneration Total AmountFeeforattendingBoardandBoard

Committeemeetings

Commission IndependentDirectors’MeetingFee

1. Independent DirectorsS.Banerjee 1,50,000 Nil 10,000 1,60,000A.Guhamallick 1,50,000 10,000 1,60,000Total Amount (b)(1) 3,00,000 20,000 3,20,000

2. Other Non-Executive DirectorsR.Tandon Nil Nil Nil NilB.B.ChatterjeeSaradinduDuttaTotal Amount (b)(2) Nil

Total Amount (b) = (b)(1) + (b)(2) 3,20,000Total Managerial Remuneration (A + b) 21,87,172OverallceilingaspertheCompaniesAct,2013 42,00,000perannum

(refer Note)

Note : Ceiling as per Part II of Schedule V to the Companies Act, 2013 has been disclosed, considering that the profits of the Company for the financial year ended 31st March, 2016 are inadequate.

C. Remuneration to Key Managerial Personnel other than MD / Manager / WTD: (Amountin`)

Sl. No.

Particulars of Remuneration V. Luharuka(Chief Financial

Officer)(refer Note)

1. GrossSalary

(a)SalaryasperprovisionscontainedinSection17(1)oftheIncome-taxAct,1961 20,62,735

(b)ValueofperquisitesunderSection17(2)oftheIncome-taxAct,1961 3,36,687

(c)ProfitsinlieuofsalaryunderSection17(3)oftheIncome-taxAct,1961 –

2. StockOption –

3. SweatEquity –

4. Commission-as%ofprofit-others,specify

5. Others,pleasespecify –

Total Amount 23,99,422

Note: Mr. V. Luharuka is on deputation from ITC Limited.

VII. PENALTIES / PUNISHMENT / COMPOUNDING OF OFFENCES against the Company, Directors and other Officers in Default under the Companies Act, 2013 : None

OnbehalfoftheBoard

R.TANDON Chairman

Dated:2ndMay,2016 SARADINDUDUTTA Director

221


INDEPENDENT AUDITOR’S REPORT TO THE MEMbERS OF GOLD FLAKE CORPORATION LIMITED

Report on the Financial Statements

1. WehaveauditedtheaccompanyingfinancialstatementsofGOLDFLAKECORPORATIONLIMITED (“theCompany”),whichcomprise theBalanceSheetasat31stMarch,2016,theStatementofProfitandLossandtheCashFlowStatementfortheyearthenended,signedbyusunderreferencetothisreportandasummaryofthesignificantaccountingpoliciesandotherexplanatoryinformation.ThesefinancialstatementsaretheresponsibilityoftheCompany’smanagement.Ourresponsibilityistoexpressanopiniononthesefinancialstatementsbasedonouraudit.

Management’s Responsibility for the Financial Statements

2. TheCompany’sBoardofDirectorsisresponsibleforthemattersstatedinSection134(5)oftheCompaniesAct,2013(“theAct”)withrespecttothepreparationandpresentationofthesefinancialstatementsthatgiveatrueandfairviewofthefinancialposition,financialperformanceandcashflowsof theCompany inaccordancewith theaccountingprinciplesgenerallyaccepted in India, including the Accounting Standards specified underSection 133 of the Act, readwith Rule 7 of the Companies (Accounts)Rules, 2014. This responsibility also includes maintenance of adequateaccounting records in accordance with the provisions of the Act forsafeguardingtheassetsoftheCompanyandforpreventinganddetectingfrauds and other irregularities; selection and application of appropriateaccountingpolicies;makingjudgmentsandestimatesthatarereasonableandprudent;anddesign,implementationandmaintenanceofadequateinternalfinancialcontrols,thatwereoperatingeffectivelyforensuringtheaccuracy and completeness of the accounting records, relevant to thepreparationandpresentationofthefinancialstatementsthatgiveatrueand fair view and are free frommaterialmisstatement,whether due tofraudorerror.

Auditor’s Responsibility

3. Our responsibility is toexpressanopinionon thesefinancial statementsbasedonouraudit.

4. WehavetakenintoaccounttheprovisionsoftheAct,theaccountingandauditingstandardsandmatterswhicharerequiredtobeincludedintheauditreportundertheprovisionsoftheActandtheRulesmadethereunder.

5. We conducted our audit in accordancewith the Standards onAuditingspecifiedunderSection143(10)oftheAct.ThoseStandardsrequirethatwecomplywithethicalrequirementsandplanandperformtheaudittoobtain reasonable assurance aboutwhether the financial statements arefreefrommaterialmisstatement.

6. An audit involves performing procedures to obtain audit evidenceabout the amounts and the disclosures in the financial statements. Theprocedures selected depend on the auditor’s judgment, including theassessmentoftherisksofmaterialmisstatementofthefinancialstatements,whetherduetofraudorerror.Inmakingthoseriskassessments,theauditorconsidersinternalfinancialcontrolrelevanttotheCompany’spreparationofthefinancialstatementsthatgiveatrueandfairviewinordertodesignaudit procedures that are appropriate in the circumstances. An auditalso includes evaluating the appropriateness of the accounting policiesused and the reasonableness of the accounting estimatesmade by theCompany’sDirectors,aswellasevaluatingtheoverallpresentationofthefinancialstatements.

7. We believe that the audit evidence we have obtained is sufficient andappropriate to provide a basis for our audit opinion on the financialstatements.

Opinion

8. Inouropinionandto thebestofour informationandaccording to theexplanations given to us, the aforesaid financial statements give theinformation required by the Act in themanner so required and give atrueandfairviewinconformitywiththeaccountingprinciplesgenerallyacceptedinIndia,ofthestateofaffairsoftheCompanyasat31stMarch,2016,itsprofitanditscashflowsfortheyearendedonthatdate.

Report on Other Legal and Regulatory Requirements

9. As required by the Companies (Auditor’s Report) Order, 2016 (“theOrder”)issuedbytheCentralGovernmentofIndiaintermsofsub–section(11)ofSection143oftheAct,wegiveinthe“Annexure-A”,astatementonthemattersspecifiedinparagraphs3and4oftheOrder,totheextentapplicable.

10. AsrequiredbySection143(3)oftheAct,wereportthat:

(a) wehave sought andobtained all the information and explanationswhichtothebestofourknowledgeandbeliefwerenecessaryforthepurposesofouraudit.

(b) inouropinion,properbooksofaccountasrequiredbylawhavebeenkeptby theCompany so far as it appears fromour examinationofthosebooks.

(c) theBalanceSheet,theStatementofProfitandLossandtheCashFlowStatementdealtwithbythisreportareinagreementwiththebooksofaccount.

(d) in our opinion, the aforesaid financial statements comply with theAccounting Standards specified under Section 133 of theAct, readwithRule7oftheCompanies(Accounts)Rules,2014.

(e) onthebasisofthewrittenrepresentationsreceivedfromthedirectorsason31stMarch,2016takenonrecordby theBoardofDirectors,noneofthedirectorsisdisqualifiedason31stMarch,2016frombeingappointedasadirectorintermsofSection164(2)oftheAct.

(f) with respect to the adequacyof the internal financial controls overfinancialreportingoftheCompanyandtheoperatingeffectivenessofsuchcontrols,werefertoourseparatereportin“Annexure-B”;and

(g) withrespecttotheothermatterstobeincludedintheAuditor’sReportin accordancewithRule11of theCompanies (Audit andAuditors)Rules,2014, inouropinionand to thebestofour informationandaccordingtotheexplanationsgiventous:

i. TheCompanydoesnothaveanypendinglitigationswhichwouldimpactitsfinancialpositions.

ii. The Company did not have any long-term contracts includingderivativecontractsforwhichtherewereanymaterialforeseeablelosses.

iii. TherewerenoamountswhichwererequiredtobetransferredtotheInvestorEducationandProtectionFundbytheCompany.

ForL.B.Jha&Co. Chartered Accountants (FirmRegistrationnumber:301088E) KamalKumarBhanjaKolkata Partner2ndMay,2016 (MembershipNo.14722)

ANNEXURE-A : TO THE INDEPENDENT AUDITOR’S REPORT TO THE MEMbERS OF GOLD FLAKE CORPORATION LIMITED[Referredtoinparagraph9oftheIndependentAuditor’sReportofevendate]1. (a) TheCompanyismaintainingproperrecordsshowingfullparticulars

includingquantitativedetailsandsituationoffixedassets. (b) ThefixedassetsoftheCompanyhavebeenphysicallyverifiedbythe

managementduringtheyearandnomaterialdiscrepanciesbetweenthebookrecordsandthephysicalinventoryhavebeennoticed.Inouropinion,thefrequencyofverificationisreasonable.

(c) According to the informationandexplanationsgiven tousand therecordsoftheCompanyexaminedbyus,thecompanydoesnothaveanyimmovableproperties.

2. TheCompanydoesnothaveanyinventory.3. The Company has not granted any loans, secured or unsecured, to

companies,firms, limited liabilitypartnershiporotherpartiescovered intheregistermaintainedunderSection189oftheAct.

4. According to the information and explanations given to us and therecords of the Company examined by us, the Company has notmadeanyinvestment,advancedanyloan,givenanyguaranteeorprovidedanysecurities toothersduring theyear. Investmentsmadeby theCompanybeforetheActcameintooperation,however,aredisclosedinNote6oftheaccompanyingfinancialstatements.

5. The Company has not accepted any deposits within the meaning ofSections73to76oftheActandtheRulesframedthereunder.

6. TheCentralGovernmentofIndiahasnotprescribedmaintenanceofcostrecords under sub-section (1) of Section 148 of the Act for any of theproductsoftheCompany.

7. (a) According to the information and explanations given to us andthe records of the Company examined by us, in our opinion, theCompany is regular in depositing the undisputed statutory duesincluding provident fund, employees’ state insurance, income-tax,sales-tax,servicetax,dutyofcustoms,dutyofexcise,valueaddedtax,cessandanyotherstatutorydues,withtheappropriateauthorities.

(b) According to the informationandexplanationsgiven tousand therecordsoftheCompanyexaminedbyus,therearenoduesofincometaxorsalestaxorservicetaxordutyofcustomsordutyofexciseorvalueaddedtaxwhichhavenotbeendepositedonaccountofanydispute.

8. The Company has neither taken any loan from financial institutions orbanksorGovernmentnorissuedanydebentures.

9. TheCompanyhasneitherraisedanymoneybypublicissuesofsharesordebenturesnorobtainedanytermloansduringtheyear.

10. During the course of our examination of the books and records of theCompany,carriedoutinaccordancewiththegenerallyacceptedauditingpracticesinIndia,andaccordingtotheinformationandexplanationsgivento us,wehaveneither come across any instanceof fraudonor by theCompany,noticedorreportedduringtheyear,norhavewebeeninformedofsuchcasebythemanagement.

11. AccordingtotheinformationandexplanationsgiventousandtherecordsoftheCompanyexaminedbyus,totalmanagerialremunerationpaidasreflectedinthefinancialstatementsfortheyearended31stMarch,2016areinaccordancewiththerequisiteapprovalsmandatedbytheprovisionsofSection197readwithScheduleVtotheAct.

12. The related statutes are not applicable as the company is not a NidhiCompany.

13. Accordingtotheinformationandexplanationsgiventousandtherecordsof theCompany examinedbyus, theCompanyhas compliedwith therequirements of Sections 177 and 188 of the Act with respect to itstransactionswiththerelatedparties.Pursuanttotherequirementof theapplicableAccountingStandard,detailsof the relatedparty transactionshavebeendisclosedinNote14(vi)ofthefinancialstatementsfortheyearunderaudit.

14. TheCompanyhasneithermadeanypreferentialallotmentofsharesnorfullyorpartlyconvertibledebenturesduringtheyearunderaudit.

222


15. AccordingtotheinformationandexplanationsgiventousandtherecordsoftheCompanyexaminedbyus,theCompanyhasnotenteredintoanynon-cashtransactions,withanydirectoroftheCompanyandtheholdingcompanyorpersonsconnectedwiththem,involvingacquisitionofassetsbyorfromthemforconsiderationotherthancash.

16. Inouropinion,andaccordingtotheinformationandexplanationsgiventous,notbeinganon-bankingfinancial company, theCompany isnot

ANNEXURE-b TO THE INDEPENDENT AUDITOR’S REPORT TO THE MEMbERS OF GOLD FLAKE CORPORATION LIMITED[Referred to inparagraph10(f)of the IndependentAuditor’sReportof evendate]Report on the Internal Financial Control under Clause (i) of Sub-sections 3 of Section 143 of the Companies Act, 2013 (”the Act”)1. Wehaveauditedtheinternalfinancialcontrolsoverfinancialreportingof

GOLD FLAKE CORPORATION LIMITED (“the Company”) as of March31,2016inconjunctionwithourauditofthefinancialstatementsoftheCompanyfortheyearendedonthatdate.

Management’s Responsibility for Internal Financial Control2. The Company’s management is responsible for establishing and

maintaining internal financial controlbasedon the internal controloverfinancial reporting criteria established by the Company considering theessential components of internal control stated in the Guidance Noteon Audit of Internal Financial Controls over Financial Reporting (the“Guidance Note”) issued by the Institute of Chartered Accountants ofIndia. These responsibilities include the design, implementation andmaintenanceof adequate internal financial controls thatwereoperatingeffectively for ensuring theorderly andefficient conductof itsbusiness,includingadherencetocompany’spolicies,thesafeguardingofitsassets,the prevention and detection of frauds and errors, the accuracy andcompleteness of the accounting records, and the timely preparation ofreliablefinancialinformation,asrequiredundertheCompaniesAct,2013.

Auditor’s Responsibility3. Our responsibility is to express an opinion on the Company’s internal

financialcontrolsoverfinancialreportingbasedonouraudit.Weconductedouraudit inaccordancewiththe“GuidanceNote”andtheStandardonAuditing, issued by the Institute of Chartered Accountants of India anddeemed to be prescribed under Section 143(10) of theCompanies Act2013,totheextentapplicable.ThoseStandardsandtheGuidanceNoterequirethatwecomplywithethicalrequirementsandplanandperformtheaudittoobtainreasonableassuranceaboutwhetheradequateinternalfinancialcontrolsoverfinancialreportingwasestablishedandmaintainingandifsuchcontrolsoperatedeffectivelyinallmaterialrespects.

4. Ourauditinvolvesperformingprocedurestoobtainauditevidenceaboutthe adequacy of the internal financial controls system over financialreportingandtheiroperatingeffectiveness.Ourauditofinternalfinancialcontrolsoverfinancial reporting includesobtaininganunderstandingofinternal financial control over financial reporting, assessing the risk thata material weakness exists, and testing and evaluating the design andoperating effectiveness of internal controls based on the assessed risk.Theprocedureselecteddependsontheauditor’sjudgment,includingtheassessmentoftheriskofmaterialmisstatementofthefinancialstatement,whetherduetofraudorerror.

5. We believe that the audit evidence we have obtained is sufficient and

requiredtoberegisteredunderSection45-IAoftheReserveBankofIndiaAct,1934.

ForL.B.Jha&Co. Chartered Accountants (FirmRegistrationNo:301088E) KamalKumarBhanjaKolkata Partner2ndMay,2016 (MembershipNo.14722)

appropriate to provide a basis for our audit opinion on theCompany’sinternalfinancialcontrolssystemoverfinancialreporting.

Meaning of Internal Financial Control over Financial Reporting6. Acompany’sinternalfinancialcontroloverfinancialreportingisaprocess

designed to provide reasonable assurance regarding the reliability offinancialreportingandthepreparationoffinancialstatementforexternalpurposesinaccordancewithgenerallyacceptedaccountingprinciples.Acompany’sinternalfinancialcontroloverfinancialreportingincludesthosepoliciesandproceduresthat1) pertaintothemaintenanceoftherecordsthat,inreasonabledetail,

accurately and fairly reflect the transactions anddispositions of theassetsofthecompany;

2) provide reasonable assurance that the transactions are recorded asnecessarytopermitpreparationoffinancialstatementinaccordancewithgenerallyacceptedaccountingprinciples,andthatreceiptsandexpenditureofthecompanyarebeingmadeonlyinaccordancewithauthorizationofmanagementanddirectorsofcompany;and

3) providereasonableassuranceregardingpreventionortimelydetectionof unauthorized acquisition, use, or disposition of the company’sassetsthatcouldhaveamaterialeffectonthefinancialstatement.

Inherent Limitations of Internal Financial Control over Financial Reporting7. Because of inherent limitation of internal financial control over financial

reporting,includingthepossibilityofcollusionorimpropermanagementoverride of controls,materialmisstatements due to errors or fraudmayoccur and not be detected. Also, projections of any evaluations of theinternal financial control over financial reporting to future periods aresubjecttotheriskthattheinternalfinancialcontroloverfinancialreportingmay become inadequate because of changes in conditions, or that thedegreeofcompliancewiththepoliciesorproceduresmaydeteriorate.

Opinion8. In our opinion, the Company has, in all material respect, an adequate

internalfinancialcontrolssystemoverfinancialreportingandsuchinternalfinancialcontrolsoverfinancialreportingwereoperatingeffectivelyasatMarch 31, 2016, based on the internal control over financial reportingcriteriaestablishedbythecompanyconsidering,theessentialcomponentsof internal control stated in the Guidance Note on Audit of InternalFinancial Control Over Financial Reporting, issued by the Institute ofCharteredAccountantsofIndia.

For L.B.Jha&Co.Chartered Accountants

(FirmRegistrationnumber:301088E)KamalKumarBhanja

Kolkata Partner2ndMay,2016 (MembershipNo.14722)

bALANCE SHEET AS AT 31ST MARCH, 2016 As at Asat Note 31st March, 2016 31stMarch,2015 (`) (`)EQUITY AND LIAbILITIES Shareholders’ funds Sharecapital 1 15,99,83,850 15,99,83,850 Reservesandsurplus 2 7,02,23,282 23,02,07,132 4,38,42,452 20,38,26,302Non-current liabilities Long-termprovisions 3 – 1,68,027Current liabilities Othercurrentliabilities 4 36,575 60,090TOTAL 23,02,43,707 20,40,54,419

ASSETS Non-current assets Fixedassets Tangibleassets 5 37,321 – Non-currentinvestments 6 6,00,63,750 6,00,63,750Current assets Cashandbankbalances 7 16,72,14,592 14,14,47,128 Short-termloansandadvances 8 4,39,621 3,69,780 Othercurrentassets 9 24,88,423 17,01,42,636 21,73,761 14,39,90,669TOTAL 23,02,43,707 20,40,54,419Theaccompanyingnotes1to15areanintegralpartoftheFinancialStatements.

Intermsofourreportofevendate

ForL.B.Jha&Co. Chartered Accountants OnbehalfoftheBoardKAMALKUMARBHANJA Partner SARADINDUDUTTA Director R.TANDON ChairmanKolkata,2ndMay,2016 V.LUHARUKA Chief Financial Officer N.BAJAJ Manager & Company Secretary

223


STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31ST MARCH, 2016

Note For the year ended Fortheyearended 31st March, 2016 31stMarch,2015 (`) (`)

Otherincome 10 3,41,72,776 4,19,98,902

Total Revenue 3,41,72,776 4,19,98,902Expenses Employeebenefitsexpense 11 43,81,211 20,75,863Depreciationexpense 4,418 – Otherexpenses 12 5,06,986 2,22,553Total Expenses 48,92,615 22,98,416

Profit before tax 2,92,80,161 3,97,00,486

Taxexpense: Currenttax 13 28,99,331 63,50,000Profit for the year 2,63,80,830 3,33,50,486Earningspershare(FaceValue`10.00each) 14(i) ` 1.65 `2.08(BasicandDiluted)

Theaccompanyingnotes1to15areanintegralpartoftheFinancialStatements.


ForL.B.Jha&Co.

Chartered Accountants OnbehalfoftheBoard

KAMALKUMARBHANJA Partner SARADINDUDUTTA Director R.TANDON ChairmanKolkata,2ndMay,2016 V.LUHARUKA Chief Financial Officer N.BAJAJ Manager & Company Secretary

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2016 For the year ended Fortheyearended 31st March, 2016 31stMarch,2015 (`) (`) A. Cash Flow from Operating Activities PROFITBEFORETAX 2,92,80,161 3,97,00,486 ADJUSTMENTSFOR: Depreciation 4,418 – InterestIncomeonbankdeposits (1,39,22,776) (2,12,84,698) DividendIncomefromLongTermInvestments (2,02,50,000) (2,02,50,000) (3,41,68,358) (4,15,34,698)

OPERATINGPROFITBEFOREWORKINGCAPITALCHANGES (48,88,197) (18,34,212) ADJUSTMENTSFOR: LoansandAdvancesandOtherAssets – 5,000 OtherLiabilitiesandProvisions (1,91,542) (1,91,542) (4,03,745) (3,98,745) CASHUSEDINOPERATIONS (50,79,739) (22,32,957) IncomeTaxPaid (29,69,172) (62,54,184)

NET CASH USED IN OPERATING ACTIVITIES (80,48,911) (84,87,141)

b. Cash Flow from Investing Activities PurchaseofFixedAssets (41,739) – DividendIncomefromLongTermInvestmentsReceived 2,02,50,000 2,02,50,000 InterestReceived 1,36,08,114 2,34,91,065 Investmentinbankdeposits (originalmaturitymorethan3months) (16,94,62,523) (36,65,44,443) Redemption/Maturityofbankdeposits (originalmaturitymorethan3months) 14,34,91,607 50,40,84,604 NET CASH FROM INVESTING ACTIVITIES 78,45,459 18,12,81,226

C. Cash Flow from Financing Activities InterimDividendPaid – (14,39,85,465) IncomeTaxonInterimDividendPaid – (2,87,88,625)

NET CASH USED IN FINANCING ACTIVITIES – (17,27,74,090)

NET INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS (2,03,452) 19,995OPENING CASH AND CASH EQUIVALENTS 3,49,192 3,29,197CLOSING CASH AND CASH EQUIVALENTS 1,45,740 3,49,192Notes: 1. TheaboveCashFlowStatementhasbeenpreparedunderthe“IndirectMethod”assetoutinAccountingStandard-3“CashFlowStatements”. 2. CASH AND CASH EQUIVALENTS : CashandCashEquivalentsasabove 1,45,740 3,49,192 Otherbankbalances 16,70,68,852 14,10,97,936

Cashandbankbalances(Note7) 16,72,14,592 14,14,47,128Theaccompanyingnotes1to15areanintegralpartoftheFinancialStatements.


ForL.B.Jha&Co. Chartered Accountants OnbehalfoftheBoardKAMALKUMARBHANJA Partner SARADINDUDUTTA Director R.TANDON ChairmanKolkata,2ndMay,2016 V.LUHARUKA Chief Financial Officer N.BAJAJ Manager & Company Secretary

224


As at As at Asat Asat 31st March, 2016 31st March, 2016 31stMarch,2015 31stMarch,2015

(No. of Shares) (`) (No.ofShares) (`)

1. Share capital

Authorised

EquitySharesof`10.00each 2,00,00,000 20,00,00,000 2,00,00,000 20,00,00,000

Issued and Subscribed EquitySharesof`10.00each,fullypaid 1,59,98,385 15,99,83,850 1,59,98,385 15,99,83,850

A) Reconciliation of number of Equity Shares outstanding Atthebeginningandattheendoftheyear 1,59,98,385 15,99,83,850 1,59,98,385 15,99,83,850

B) Shareholders holding more than 5% of the Equity Shares in the Company As at As at Asat Asat 31st March, 2016 31st March, 2016 31stMarch,2015 31stMarch,2015 (No. of Shares) (%) (No.ofShares) (%) ITCLimited-HoldingCompany 1,59,98,385 100.00 1,59,98,385 100.00

C) Rights, preferences and restrictions attached to the Equity Shares TheEquitySharesoftheCompany,havingparvalueof`10.00pershare,rankpari passuinallrespectsincludingvotingrightsandentitlementtodividend.

As at Asat 31st March, 2016 31stMarch,2015 (`) (`)

2. Reserves and surplus GeneralReserve Atthebeginningandattheendoftheyear 87,26,223 87,26,223 SurplusinStatementofProfitandLoss Atthebeginningoftheyear 3,51,16,229 17,45,39,833

Add:Profitfortheyear 2,63,80,830 3,33,50,486 Less:InterimDividend[Nil(2015-` 9.00)pershare] – 14,39,85,465 IncomeTaxonInterimDividend – 2,87,88,625 Attheendoftheyear 6,14,97,059 3,51,16,229

TOTAL 7,02,23,282 4,38,42,452

NOTES TO THE FINANCIAL STATEMENTS

As at Asat 31st March, 2016 31stMarch,2015 (`) (`)3. Long-term provisions Provision for employee benefits: Provisionforgratuity – 74,745 Provisionforcompensatedabsences – 93,282

TOTAL – 1,68,027

As at Asat 31st March, 2016 31stMarch,2015 (`) (`)4. Other current liabilities Other payables Statutoryliabilities – 4,500 Liabilitiesforexpenses 36,575 55,590

TOTAL 36,575 60,090

5. Fixed assets (`)

Particulars GrossBlock Depreciation NetBookValue

Asat31stMarch,

2014

Additions Withdrawalsand

adjustments

Asat31stMarch,

2015

Additions Withdrawals and

adjustments

As at 31st March,

2016

Upto 31stMarch,

2014

For the year

OnWithdrawals

andadjustments

Upto 31stMarch,

2015

For the year

On Withdrawals

and adjustments

Upto 31st March,

2016

As at 31st March,

2016

Asat31stMarch,

2015

Asat31stMarch,

2014

Tangible assets PlantandEquipmentComputersanddataprocessingunitsFurnitureandFixtures

85,853

– 5,090

–

––

–

––

85,853

–5,090

–

41,739–

85,853 –

5,090

–

41,739–

85,853

–5,090

–

––

–

––

85,853

–5,090

–

4,418 –

85,853

– 5,090

–

4,418–

–

37,321–

–

––

–

––

TOTAL 90,943 – – 90,943 41,739 90,943 41,739 90,943 – – 90,943 4,418 90,943 4,418 37,321 – –

As at Asat 31st March,2016 31stMarch,2015 (`) (`)6. Non- current investments (at cost unless stated otherwise) Long Term

TRADE INVESTMENTS (Unquoted)

INVESTMENT IN EQUITY INSTRUMENTS

In Associate

ATCLimited 55,650(2015-55,650)EquitySharesof`100.00each,fullypaid 83,47,500 83,47,500

1,39,125(2015-1,39,125)EquitySharesof`100.00each,`70.00paid 2,92,16,250 3,75,63,750 2,92,16,250 3,75,63,750

In Joint Venture ITCEssentraLimited 22,50,000(2015-22,50,000)EquitySharesof` 10.00each,fullypaid 2,25,00,000 2,25,00,000

Aggregate amount of unquoted Investments 6,00,63,750 6,00,63,750

Total Non-current investments 6,00,63,750 6,00,63,750

225


NOTES TO THE FINANCIAL STATEMENTS (Contd.)

As at Asat 31st March, 2016 31stMarch,2015 (`) (`)

7. Cash and bank balances Cashandcashequivalents@ Balanceswithbanks Currentaccounts 1,45,740 3,49,132 Cashonhand – 1,45,740 60 3,49,192 Otherbankbalances Indepositaccounts 16,70,68,852 14,10,97,936

TOTAL 16,72,14,592 14,14,47,128

@Cashandcashequivalentsincludecashonhandandcashatbank.

8. Short-term loans and advances

Unsecured,consideredgood

AdvanceTax(netofprovisions) 4,39,621 3,69,780

TOTAL 4,39,621 3,69,780

9. Other current assets

Interestaccruedonbankdeposits 24,88,423 21,73,761

TOTAL 24,88,423 21,73,761

For the year ended Fortheyearended 31st March, 2016 31stMarch,2015 (`) (`)

10. Other Income Interestincome DepositswithBanks 1,39,22,776 2,12,84,698 Dividendincome Long-terminvestments 2,02,50,000 2,02,50,000 Othernon-operatingincome – 4,64,204

TOTAL 3,41,72,776 4,19,98,902

11. Employee benefits expense Salariesandwages 43,54,606 19,58,825 Provisionforretirementandotherbenefits – 66,946 Staffwelfareexpenses 26,605 50,092

TOTAL 43,81,211 20,75,863

12. Other expenses Ratesandtaxes 54,970 12,780 Insurance 630 618 Travellingandconveyance 1,350 1,375 Filingfees 4,310 4,821 Directors’sittingfees 3,20,000 80,000 Consultancy/Professionalfees 44,524 66,373 Auditors’remunerationandexpenses Auditfees 40,075 28,090 Taxauditfees 5,700 5,618 Feesforotherservices 26,667 19,663 Miscellaneousexpenses 8,760 3,215

TOTAL 5,06,986 2,22,553

13. Tax expense Currenttax Incometaxfortheyear 28,98,662 63,50,000 -forearlieryears 669 –

TOTAL 28,99,331 63,50,000

14. Additional Notes to the Financial Statements

i. Earnings per share

2016 2015

Earningspersharehasbeencomputedasunder:

(a)Profitfortheyear(` ) 2,63,80,830 3,33,50,486

(b)WeightedaveragenumberofEquitysharesoutstanding

1,59,98,385 1,59,98,385

(c)Earningspershareonprofitfortheyear(FaceValue` 10.00pershare)-Basic&Diluted[(a)/(b)]

` 1.65 ` 2.08

ii. Uncalled liability in respect of partly paid-up1,39,125 shares of ATC Limited@ ` 90.00pershare(includes` 60.00pershareaspremium)is`1,25,21,250(2015-` 1,25,21,250).

iii.Segment Reporting

TheCompanyoperatesinasinglebusinessandgeographicalsegmentinIndia.

iv.TheincidenceofDeferredTaxbeinginsignificantisnotconsidered.

v. TherearenoMicro,SmallandMediumEnterprises,towhomtheCompanyowesdues,whichareoutstandingformorethan45daysduringtheyearandalsoasat31stMarch,2016.ThisinformationasrequiredtobedisclosedundertheMicro,SmallandMediumEnterprisesDevelopmentAct,2006hasbeendeterminedtothe

extentsuchpartieshavebeenidentifiedonthebasisofinformationavailablewiththeCompany.

vi. Related Party Disclosures

(a) Relationship: HoldingCompany – ITCLimited JointVenture – ITCEssentraLimited AssociateCompany – ATCLimited KeyManagementPersonnel – Mr.RajivTandon Non-ExecutiveChairman – Mr.B.B.Chatterjee Non-ExecutiveDirector – Mr.SaradinduDutta Non-ExecutiveDirector – Mr.SubhatoshBanerjee IndependentDirector(w.e.f.16.03.2015) – Ms.AninditaGuhamallick IndependentDirector(w.e.f.16.03.2015) – Mr.VishalLuharuka ChiefFinancialOfficer(CFO)(w.e.f.01.01.2015) – Ms.NidhiBajaj ManagerandCompanySecretary

(b) DISCLOSUREOFTRANSACTIONSBETWEENTHECOMPANYANDRELATED PARTIESANDTHESTATUSOFOUTSTANDINGBALANCESASAT31.03.2016

(`)

RELATED PARTY TRANSACTION SUMMARY

Holding Company Joint Venture Key Management Personnel

2016 2015 2016 2015 2016 2015

1. PurchaseofServices 29,770 22,472 – – – –

2. InterimDividendPaid – 14,39,85,465 – – – –

3. DividendIncome – – 2,02,50,000 2,02,50,000 – –

4. RemunerationofCFOondeputationreimbursed

24,34,222 4,26,753 – – – –

5. RemunerationofManagerandCompanySecretary

9,00,719 – – – 10,46,270 15,82,164

6. Directors’sittingfees-Mr.SubhatoshBanerjee-Ms.AninditaGuhamallick

– – – – 1,60,0001,60,000

40,00040,000

7. balances as at 31st March

Payables-Mr.SubhatoshBanerjee-Ms.AninditaGuhamallick

– – – – – 10,00010,000

vii. Interest in Joint Venture:

TheCompany’sinterests,asaventurer,injointlycontrolledentities(incorporatedJointVenture)is:

Name Country of Incorporation

Percentage of ownership interests as at 31st March,

2016

Percentageofownershipinterestsasat31stMarch,

2015

ITCEssentraLimited India 50% 50% FinancialStatementsofITCEssentraLimitedaredrawnupforthefifteenmonthsendedasat31stMarch,2016.

TheCompany’s interests in this Joint Venture is reported asNon-Current Investment(Note 6) and stated at cost. However, the Company’s share of each of the assets,liabilities, income and expenses, etc. (each without elimination of the effect oftransactionsbetweentheCompanyandtheJointVenture)relatedtoitsinterestsintheJointVentureare:

226



As at

31st March, 2016

(`)

Asat

31stDecember,2014

(`)ASSETS Non-current Assets 1.Fixedassets a)Tangibleassets 24,61,78,152 26,15,40,838b)Intangibleassets 1,63,137 3,80,961

2.Long-termloansandadvances 67,10,080 88,87,067Current Assets, Loans and Advances 3.Currentinvestments 17,92,212 –4.Inventories 27,06,26,206 28,98,57,7235.Tradereceivables 5,36,71,138 5,78,64,5196.Cashandcashequivalents 17,14,33,960 3,37,34,7857.Short-termloansandadvances 2,64,60,678 1,91,29,5088.Othercurrentassets 23,45,031 11,51,127LIAbILITIES Non - Current Liabilities 9.Deferredtaxliabilities(net) 1,22,49,450 97,45,30010.Long-termprovisions 56,89,796 49,50,005Current Liabilities and Provisions 11.Short-termborrowings – 10,44,02,43412.Tradepayables 31,09,01,127 14,28,40,64713.Othercurrentliabilities 92,71,847 2,18,31,59614.Short-termprovisions 2,48,79,930 2,47,79,596

For the fifteen months ended31st March, 2016

(`)

Fortheyearended31stDecember,2014

(`)

INCOME

1.Netrevenuefromsaleofproducts 1,79,63,61,499 1,46,85,85,794

2.Otheroperatingrevenue 49,20,599 53,03,152

3.Otherincome 65,59,684 42,34,817

EXPENSES

4.Costofmaterialsconsumed 1,56,80,63,263 1,27,87,42,916

5.Changeininventoriesoffinishedgoods 7,66,950 12,53,873

6.Employeebenefitexpenses 3,76,10,920 2,78,11,150

7.Financecosts 15,14,481 63,98,542

8.Depreciationandamortizationexpense 2,18,67,362 1,68,76,949

9.Otherexpenses 6,29,81,530 5,54,95,114

10.TaxExpense 3,82,73,358 3,04,51,000

viii. DefinedBenefitPlans/LongTermCompensatedAbsences-AsperActuarialValuationsason31stMarch,2016andrecognisedinthefinancialstatementsinrespectofEmployeeBenefitSchemes:

For the year ended 31st March, 2016(`)

Fortheyearended31stMarch,2015(`)

Gratuity Leave Encashment Gratuity LeaveEncashment

Unfunded Unfunded Unfunded Unfunded

I. Components of Employer Expense

1.2.3.4.5.6.7.

CurrentServiceCostInterestCostExpectedReturnonPlanAssetsCurtailmentCost/(Credit)SettlementCost/(Credit)PastServiceCostActuarialLosses/(Gains)

–––––––

–––––––

12,8323,415

––––

14,439

7,3114,419

––––

24,530

8. Total expense recognised in the Statement of Profit & Loss – – 30,686 36,260

TheGratuityandLeaveEncashmentexpenseshavebeenrecognizedin“Provisionforretirementandotherbenefits”in“Employeebenefitsexpense”underNote11.

II. Actual Returns – – – –

III. Net Asset/(Liability) recognised in balance Sheet

1.2.3.4.5.

PresentValueofDefinedBenefitObligationFairValueonPlanAssetsStatus[Surplus/(Deficit)]UnrecognizedPastServiceCost Net Asset / (Liability) recognised in balance Sheet

–––––

–––––

74,745–

(74,745)–

(74,745)

93,282–

(93,282)–

(93,282)

IV. Change in Defined Benefit Obligation (DBO)

1.2.3.4.5.6.7.8.9.10.

PresentValueofDBOatthebeginningoftheyearCurrentServiceCostInterestCostCurtailmentCost/(Credit)SettlementCost/(Credit)PlanAmendmentsPastServiceCostActuarial(Gains)/LossesBenefitsPaidPresent Value of DbO at the end of the year

74,745–––––––

(74,745)–

93,282–––––––

(93,282)–

44,05912,8323,415

––––

14,439–

74,745

57,0227,3114,419

––––

24,530–

93,282

V. Change in Fair Value of Assets

1.2.3.4.5.6.7.

PlanAssetsatthebeginningoftheyearAcquisitionAdjustmentExpectedReturnonPlanAssetsActuarialGains/(Losses)ActualCompanyContributionsBenefitsPaidPlanAssetsattheendoftheyear

–––––––

–––––––

–––––––

–––––––

VI. Actuarial Assumptions

1.2.

DiscountRate(%)ExpectedReturnonPlanAssets(%)

––

––

7.75–

7.75–

Theestimatesoffuturesalaryincreases,consideredinactuarialvaluationtakeaccountofinflation,seniority,promotionandotherrelevantfactorssuchassupplyanddemandfactorsintheemploymentmarket.

227



VII. Major Category of Plan Assets as a % of the Total Plan Assets As at 31st March, 2016 Asat31stMarch,2015

1.2.3.4.5.6.

GovernmentSecurities/SpecialDepositwithRBIHighQualityCorporateBondsInsuranceCompaniesMutualFundsCashandCashEquivalentsTermDeposits

––––––

––––––

VIII. basis used to determine the Expected Rate of Return on Plan Assets :NotApplicable

IX. Net Asset/(Liability) recognised in balance Sheet (including experience adjustment)

For the year ended31st March, 2016

(`)

Fortheyearended31stMarch,2015

(`)


(`)


(`)


(`)Gratuity Leave

EncashmentGratuity Leave




EncashmentUnfunded Unfunded Unfunded Unfunded Unfunded Unfunded Unfunded Unfunded Unfunded Unfunded

PresentValueofDefinedBenefitObligation – – 74,745 93,282 44,059 57,022 33,558 45,603 18,414 22,342FairValueofPlanAssets – – – – – – – – – –Status[Surplus/(Deficit)] – – (74,745) (93,282) (44,059) (57,022) (33,558) (45,603) (18,414) (22,342)ExperienceAdjustmentofPlanAssets[Gain/(Loss)] – – – – – – – – – –ExperienceAdjustmentofObligation[(Gain)/Loss] – – – – – – – – – –

ix. PreviousYear’sfigureshavebeenregrouped/re-classified,wherenecessarytocorrespondwiththecurrentyear’sclassification/disclosure.

15. Significant Accounting Policies Convention To prepare financial statements in accordance with applicable Accounting

StandardsinIndia.Asummaryofimportantaccountingpoliciesissetoutbelow.The financial statements have also been prepared in accordance with relevantpresentationalrequirementsoftheCompaniesAct,2013.

basis of Accounting Topreparefinancialstatementsinaccordancewiththehistoricalcostconvention. Allassetsand liabilitieshavebeenclassifiedascurrentornon-currentasper the

Company’snormaloperatingcycleandothercriteriaassetoutinScheduleIIItotheCompaniesAct,2013basedonthenatureofservices.

Fixed Assets TostateFixedAssetsatcostofacquisitioninclusiveof inwardfreight,dutiesand

taxes and incidental expenses related to acquisition. Expenses capitalized alsoincludeborrowingcosts,ifany.

Depreciation TocalculatedepreciationofFixedAssetson“StraightLineMethod”basedonthe

usefullivesspecifiedinScheduleIItotheCompaniesAct,2013. Investments To state Current Investments at lower of cost and fair value and Long Term

Investments,includinginJointVenturesandAssociates,atcost.Whereapplicable,provisionismadetorecogniseadecline,otherthantemporary,invaluationofLongTermInvestments.

Inventories Tostateinventoriesatlowerofcostandnetrealizablevalue.Thecostiscalculated

OnbehalfoftheBoard

SARADINDUDUTTA Director R.TANDON ChairmanKolkata,2ndMay,2016 V.LUHARUKA Chief Financial Officer N.BAJAJ Manager & Company Secretary

Form AOC-1[Pursuant to first proviso to sub-section(3) of Section 129 read with Rule 5 of Companies (Accounts) Rules, 2014]

Statement containing salient features of the financial statement of subsidiaries/associate companies/joint venturesPart “A”: Subsidiaries

NotApplicablePart “b”: Associates and Joint Ventures

Statement pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures

Name of Associates/Joint Ventures ITC Essentra Limited ATC Limited1. Latest audited balance Sheet Date 31-Mar-2016 31-Mar-20162. Shares of Associate/Joint Ventures held by the company on the year end

No. 22,50,000 1,94,775#

AmountofInvestmentinAssociates/JointVenture 2,25,00,000 3,75,63,750ExtendofHolding% 50 47.50

3. Description of how there is significant influence JointVenture Associate4. Reason why the associate/joint venture is not consolidated NotApplicable* NotApplicable*5. Net worth attributable to Shareholding as per latest audited balance Sheet (`) 41,63,88,442 6,45,65,0456. Profit/ Loss for the year (`) 15,35,27,836 95,99,379

i.ConsideredinConsolidation* – –ii.NotConsideredinConsolidation(`) 15,35,27,836 95,99,379

* TheCompany,beinganintermediatewhollyownedsubsidiary,isnotrequiredtoprepareConsolidatedFinancialStatementsintermsoftheCompanies(Accounts)Rules,2014andITC Limited,theHoldingCompany,preparesConsolidatedFinancialStatements.

#includes, 55,650Equitysharesof`100.00each,fullypaidand 1,39,125Equitysharesof`100.00each,`70.00paid-up

1.Namesoftheassociatesorjointventureswhichareyettocommenceoperations : None 2.Namesofassociatesorjointventureswhichhavebeenliquidatedorsoldduringtheyear : None

OnbehalfoftheBoard SARADINDUDUTTA Director R.TANDON ChairmanKolkata,2ndMay,2016 V.LUHARUKA Chief Financial Officer N.BAJAJ Manager & Company Secretary

onweightedaveragemethod.Costcomprisesexpenditureincurredinthenormalcourseofbusinessinbringingsuchinventoriestoitslocationandincludes,whereapplicable,appropriateoverheadsbasedonnormallevelofactivity.

Revenue Recognition Torecognizerevenueatthetimeofrenderingofservicesnetoftradediscountsto

customersandtaxesrecoveredfromcustomers. Investment Income ToaccountforIncomefromInvestmentsonanaccrualbasis, inclusiveofrelated

taxdeductedatsource.ToaccountforIncomefromDividendswhentherighttoreceivesuchdividendsisestablished.

Employee Benefits Todeterminetheliabilitiestowardsgratuityandemployeeleaveencashmentbyan

independentactuarialvaluationaspertherequirementsofAccountingStandard–15on“EmployeeBenefits”.TodetermineactuarialgainsorlossesandtorecognisesuchgainsorlossesimmediatelyintheStatementofProfitandLossasincomeorexpense.

Taxes on Income ToprovideCurrenttaxastheamountoftaxpayableinrespectoftaxableincome

fortheperiod,measuredusingtheapplicabletaxratesandtaxlaws. To provide Deferred tax on timing differences between taxable income and

accountingincomesubjecttoconsiderationofprudence,measuredusingthetaxratesandtaxlawsthathavebeenenactedorsubstantivelyenactedbytheBalanceSheetdate.

NottorecognizeDeferredtaxassetsonunabsorbeddepreciationandcarryforwardoflossesunlessthereisvirtualcertaintythattherewillbesufficientfuturetaxableincomeavailabletorealisesuchassets.

18 Gold Flake Final - ITC Limited · 25th August, 2015 14th December, 2015 8th March, 2016 Audit Committee 4 29th April, 2015 25th August, 2015 14th December, 2015 8th March, 2016

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