WCL

1

WESTERN COALFIELDS LIMITED

ANNUAL REPORT AND ACCOUNTS

2010-2011


( A Miniratna Company)

Coal Estate, Civil Lines, Nagpur - 440 001

2

ANNUAL REPORT 2010-11

WESTERN COALFIELDS LIMITED( A Miniratna Company)

CONTENTSPage No.

1 Board of Directors 1

2 Bankers & Auditors 3

3 Notice 4

4 Performance at a glance 6

5 Chairman's Statement 9

6 Awards and Accolades 13

7 Directors’ Report 19

8 Addendum to the Directors’ Report :

a) Comments of the Comptroller and Auditor General ofIndia under section 619(4) of the Companies Act, 1956 63

b) Auditors’ Report and Management’s Reply 68

9 Balance Sheet as at 31st March, 2011 80

10 Profit & Loss Account for the year ended 31st March, 2011 81

11 Cash flow statement for the year 2010-11 82

12 Schedules (A to J) to Balance Sheet 83

13 Schedules (1 to 16) to Profit & Loss Account 93

14 Accounting Policies forming part of Balance Sheet as at31st March, 2011 and Profit & Loss Account for the yearended on that date - Schedule 17 103

15 Balance Sheet Abstract and Company’s Business Profile - Schedule 18 112

16 Notes on Accounts - Schedule 19 114

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( A Miniratna Company )

Board of Directors

( As on 27th May, 2011 )

Chairman-cum-Managing Director

Shri D.C. Garg

Functional Directors

Shri B.K. Saxena - TechnicalShri Om Prakash - TechnicalShri Sushil Behl - Finance

Government Directors (Part time)

Shri A.K. Bhalla - Joint Secretary,Ministry of Coal.

Shri R. Mohan Das - Director (Personnel & IR),Coal India Limited, Kolkata.

Non-official Directors (Part time)

Dr. Ahindra Chakrabarti - Professor, IMI, New DelhiMs. Lalitha Kumar - Former IAS Officer, New DelhiShri Vinod Somani - CA, New DelhiShri Arun Balakrishnan - Former CMD, HPCLDr. D. Chamdrashekharam - Professor, IIT, Mumbai

Permanent Invitee(s)

Shri S.K. Mishra - Secretary,Mineral Resources Department,Govt. of Madhya Pradesh, Bhopal.

Shri Satya Prakash - Chief Operations Manager,Central Railway, Mumbai.

Company Secretary

Shri Rameher

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( A Miniratna Company )

Board of Directors

( During the year 2010-11 )


Shri D.C. Garg - From 01.05.2007

Functional Directors

Shri O.P. Miglani - Personnel ( w.e.f. 01.01.2008 )

Shri B.K. Saxena - Technical ( w.e.f. 07.03.2008 )

Shri Om Prakash - Technical ( w.e.f. 01.06.2008 )

Shri Sushil Behl - Finance ( w.e.f. 01.11.2009 )

Government Directors (Part time)

Shri K.S. Kropha - Joint Secretary, Ministry of Coal,

New Delhi.( Upto 18.04.2010 )

Shri A.K. Bhalla - Joint Secretary, Ministry of Coal,

New Delhi. ( w.e.f. 06.07.2010 )

Shri R. Mohan Das - Director (Personnel & IR), Coal India

Limited, Kolkata. ( w.e.f. 28.06.2007 )

Non-official Directors (Part time)

Shri M.N. Buch - Upto 23.08.2010

Shri A.B. Dutt - Upto 23.08.2010

Shri S.K. Varma - Upto 28.08.1010

Dr. Ahindra Chakrabarti - w.e.f. 27.04.2010

Ms. Lalitha Kumar - w.e.f. 24.02.2011

Shri Vinod Somani - w.e.f. 24.02.2011

Shri Arun Balakrishnan - w.e.f. 24.02.2011

Dr. D. Chandrashekharam - w.e.f. 24.02.2011

Permanent Invitee (s)

Shri S.K. Mishra - Secretary (Revenue), Govt. of Madhya

Pradesh, Bhopal ( w.e.f. 25.09.2008 )

Shri Satya Prakash - Chief Operations Manager, Central Railway,

Mumbai ( w.e.f. 21.01.2010 )

Company Secretary

Shri Rameher - ( w.e.f. 01.02.2008 )

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BANKERS

STATE BANK OF INDIA

STATE BANK OF HYDERABAD

CENTRAL BANK OF INDIA

UNITED COMMERCIAL BANK

BANK OF MAHARASHTRA

UNION BANK OF INDIA

ORIENTAL BANK OF COMMERCE

ALLAHABAD BANK

INDIAN BANK

PUNJAB NATIONAL BANK

BANK OF INDIA

HDFC BANK

IDBI BANK

DENA BANK

STATUTORY AUDITORS

M/S C . R . SAGDEO & CO

CHARTERED ACCOUNTANTS

NAGPUR

BRANCH AUDITORS

M/S JODH JOSHI & CO


NAGPUR

M/S A . S . DANI & CO


NAGPUR

M/S CHANDAK , KHANZODE & SHENWAI


NAGPUR

REGISTERED OFFICE

COAL ESTATE ,

CIVIL LINES ,

NAGPUR – 440001

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Ref : WCL/SECY/BD/AGM-36/2011/240 Date : 23rd May, 2011

N O T I C E

THIRTY SIXTH ANNUAL GENERAL MEETING

Notice is hereby given that the Thirty Sixth Annual General Meeting of West-

ern Coalfields Limited will be held at 1.00 P.M. on Friday, the 27th May, 2011 at the

Registered Office of the Company at Coal Estate, Civil Lines, Nagpur to transact

the following business :

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance Sheet as on 31st March, 2011 andProfit & Loss Account for the year ended 31st March, 2011 together with the Directors’Report and Reports of the Statutory Auditors & Comptroller and Auditor General of India thereon.

2. To declare dividend.

3. To appoint a Director in place of Shri A.K. Bhalla, who retires in terms of Article 33(e)(iii)of the Articles of Association of the Company and is eligible for re-appointment.

4. To appoint a Director in place of Shri R. Mohan Das, who retires in terms of Article33(e)(iii) of the Articles of Association of the Company and is eligible for re-appointment.

By order of Board of DirectorsFOR WESTERN COALFIELDS LIMITED

Sd/-( Rameher )

Sr. Manager (Finance)/

Company Secretary

Registered Office :

Coal Estate, Civil Lines,

NAGPUR - 440 001

NOTE :

1. A member entitled to attend and vote at the meeting is also entitled to appoint a

proxy or proxies to attend and vote instead of himself/herself and such proxy need not

be a member of the Company. In order to be effective, the Proxy form duly completed

should be deposited at the registered office of the Company not less than forty-eight

hours before the scheduled time of the Annual General Meeting. A proxy form is enclosed.

contd.....

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2. Members are also requested to accord their consent for convening the meeting at a

shorter Notice under section 171(2)(i) of the Companies Act, 1956.

To,

1. Members/Shareholders,

Western Coalfields Limited

2. Statutory Auditors,


3. Chairman, Audit Committee,


Copy to :

All Directors, Western Coalfields Limited, Nagpur

CGM (Finance)/Company Secretary, Coal India Limited, Kolkata

Chief Finance Manager (CA & T), WCL, Nagpur

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additional revenue to the tune of Rs 613.40 crores during 2010-11, as a quantity of 59.59 Lakh

Tonnes of Coal was offered for sale under spot e-auction against which 58.16 Lakh Tonnes of

Coal was allocated and around 73% of increase over notified price was registered during 2010-11.

Sales Realisation from customers during 2010-11 has been the highest ever approximately

Rs 7314.00 crores, showing a growth of 4% against that of Rs 7027.44 crores during last

fiscal.

The total sales outstanding dues which was Rs 263.31 crores as on 01-04-2010 has de-

creased by 44.03% to the level of Rs 147.37 crores as on 31-03-2011. The reduction in out-

standing dues is mainly in respect of the major Power Houses.

Grade materialization increased to 92.38% during the year as against 89.24% last year. Ash

percentage of coal dispatched to MAHAGENCO and other State Electricity Boards is average

28.91% that is below 34% as stipulated by MOEF.

Productivity (Output per man shift) during the fiscal has been 2.65 tonnes as against the

target of 2.62 tonnes and last year’s 2.64 tonnes.

Financial Performance

During the year, WCL achieved the highest turnover of Rs 7073.44 crores registering an

increase of Rs 325.81 crores over last year’s Rs 6747.63 crores with a pre tax profit of Rs

1067.97 crores during the fiscal as against the last year’s Rs 931.03 crores. Net worth of the

company has risen from Rs 3099.86 crores to Rs 3236.58 crores as on 31-03-11. The Profit

after Tax has been Rs 538.30 crores. The Profit after Tax to Net worth a distinct measure

of return to share holders thus works out to 16.63% in 2010-11.

Your Directors have recommended a dividend payment of Rs 323.25crores @ 108.8% on the

Paid up Capital of the company i.e. 297.10 crores.

WCL has Contributed to the state exchequer during 2010-11 approx Rs 1036.26 crores by

way of royalty & Taxes thereby retaining its title of the highest corporate tax payer in Vidarbha

region.

Creation of Assets

Company has Invested Rs 239.74 crores during 2010-11 on development of new mines and

infrastructure entirely from internal resources. 64 new equipments (Heavy Earth Moving Ma-

chinery) including 2 shovels, 7 excavators, 18 dumpers and 25 dozers have been added under

HEMM fleet renewal initiative with an expenditure of Rs 121.58 crores. It is notable fact that we

have registered impressive record of being in Top Slot in machine utilization in whole of CIL.

As far as underground machineries are concerned, 9 universal drilling machines have been

added, where as 25 LHDs and 4 SDLs have been added as replacement against survey off for

fleet renewal. For optimum utilization of underground manpower, Man Riding System in 4 un-

derground mines i.e. Saoner-1, Shobhapur, Tawa-1 and Kumbharkhani is in advance stage of

installation.

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Tenders for implementation of Mass Production Technology through continuous miners are

underway for Saoner -1 UG and Maori UG to add the existing production from this technology

at Kumbharkhani UG and Tandsi UG. Further four mines e.g. Dhankasa, Jamunia, Dhau North

and Tawa II are in the offing. Global bids have already been invited for Borda UG, Murpar UG,

Nand UG.

Project Affected People – Our Stake holders

We believe in symbiotic co-existence with project affected people, our most important stake-

holders, whereby there is marked improvement in their living standards. Extension of educa-

tion, medical facilities, electrification of villages through solar lamps/ lights and improvement in

road infrastructures are some of the indirect community benefits which we propose to extend

by spending Rs 23 crores per year in the schemes of Corporate Social Responsibility.

Rising expectations of Projects affected People towards higher compensation of land in view

of spate of development and urbanization of nearby areas, vis a vis our payouts limited by

provisions of extant land acquisition laws resulted in lower than required acquisition of land

during recent past. The issue is best articulated by the fact that only 16 projects, out of 33

numbers of ongoing projects/ schemes (04 UG and 29 OC) with a capacity of 32.115 MTY and

Capital outlay Rs.1397.14 crores, are contributing coal production, on account of constraints

due to land availability of 2546.00 ha. land under physical possession as against 7222.22 ha.

acquired & 9687.32 ha. required for on-going projects.

I feel happy to share with you that, through revision in CIL R&R Policy, we have enhanced

proactively the monetary compensation in lieu of employment during acquisition of land to the

limit of Rs 5 lakhs per acre, which has made a positive impact on the PAPs. With persever-

ance, we have made progress for acquisition of 2051 Hectares of land in 2010-11 whereas

there has been 25.44% increase in physical possession of land over last year. Of course, we

are committed to enhance payouts against land values beyond existing statutory provisions

once up-scaled by notification of concerned state government, as we believe in making PAPs

our partners in prosperity. We are looking forward to State Government of Maharashtra revis-

ing its stance on the land rates in mining areas in the line of States of Haryana or Chhattisgarh.

Environment Friendly Mining

We consider it our bounden duty to protect the fragile eco-system. For that we have reoriented

our operational plans at 10 major Opencast Units, which are incidentally accredited with ISO

14000 as well, to reclaim and restore the land in perfect cohesion with mining operations. The

assessment of progress of Green Mining is being done by Satellite imagery survey in real time.

I feel happy to share with you that as per the satellite survey reports 2010, we have reclaimed

46 sq km area that is 86% of 53 sq km of the total mined out area. After analyzing the Satellite

data of the year 2008 vs 2010, it has transpired that the plantation works, carried out on back

filled area, external overburden dumps as well as on plain land in all these mines of WCL, has

increased from17.18 sq.km to 25.35 sq. km. (an increase of 47.55%). The pursuit continues

further. That’s the Green Mining.

Clean Coal Technologies

With a view to expedite the clean coal initiatives, we have identified one underground coal

gasification block at Thesgora C, Pench Area. Coal gasification will be the technology of future

as it ensures clean gas ready for industrial use. One 5 million tonne washery in Wardha Valley

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Coalfields is in offing. Other initiatives like enhancing energy efficiency measures e.g. Conser-

vation of POL, electricity in industrial and domestic use have also been undertaken.

Last but not the Least

The excellent performance of WCL has been the outcome of perfect mix of motivated employ-

ees, sound corporate governance and a team spirit with a commitment to achieve consistent

result, despite the adverse geo mining conditions. WCL has always remained on top among

CIL subsidiaries in utilisation of Heavy Earth Moving Equipment. WCL family proudly boasts of

Zero Industrial Unrest and high morale of its workforce.

We firmly believe that we will continue to maximize the returns of WCL’s key stake holders - its

shareholders, customers, employees and local populace.

With Best Wishes,

(D. C. Garg)

Chairman cum MD

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(Rs. In Crores)

PARTICULARS

SOURCE OF FUND

SHARE CAPITAL

RESERVES & SURPLUS

PROFIT & LOSS A/C

LOAN FUND

DEFERRED TAX LIABILITIES

LONG TERM LIABILITIES

T O T A L

APPLICATION

FIXED ASSETS :

Gross Block

Less : Depreciation

Less : Impairment of Assets

Net Block

Capital Work in Progress

Discarded/Surveyed off Assets

Investments

Deferred Tax Assets

CURRENT ASSETS, LOANS &ADVANCES :

Inventories

Sundry Debtors

Cash & Bank Balance

Loans & Advances

SUB TOTAL

LESS : CURRENT LIABILITIES& PROVISIONS

NET CURRENT ASSETS

MISC. EXPENDITURE

T O T A L

2009

297.10

1680.34

1843.91

133.60

15.22

0.28

3970.45

3986.99

2539.15

89.39

1358.45

217.31

13.23

240.68

345.33

288.46

191.52

3033.11

2868.96

6382.05

4586.60

1795.45

0.00

3970.45


BALANCE SHEET AS AT 31st MARCH

2002

297.10

314.68

630.92

598.15

1840.85

3052.91

1522.49

1530.42

174.10

115.73

423.12

198.98

722.15

1459.98

1400.27

59.71

76.62

1840.85

2003

297.10

437.99

742.45

549.78

2027.32

3145.82

1688.52

1457.30

181.06

4.64

154.79

106.19

471.93

291.67

671.87

1541.66

1381.90

159.76

69.77

2027.32

2004

297.10

522.50

926.38

363.80

125.98

0.00

2235.76

3218.69

1814.25

1404.44

182.96

6.19

320.90

249.70

151.59

319.59

340.22

988.67

1800.07

1728.50

71.57

0.00

2235.76

2005

297.10

604.92

1061.78

148.02

105.07

0.00

2216.89

3365.83

1956.82

71.37

1337.64

183.06

8.02

320.90

177.42

210.15

389.95

761.60

1236.50

2598.20

2408.35

189.85

0.00

2216.89

2006

297.10

788.67

1429.36

135.49

63.10

0.00

2713.72

3480.99

2072.22

81.93

1326.84

204.41

10.49

320.90

151.07

287.77

235.06

1513.75

1518.80

3555.38

2855.37

700.01

0.00

2713.72

2007

297.10

1049.59

1673.10

122.97

32.65

0.00

3175.41

3668.24

2251.34

80.63

1336.27

174.85

11.29

288.81

140.25

363.97

238.14

1296.62

1983.95

3882.68

2658.74

1223.94

0.00

3175.41

2008

297.10

1343.88

1794.26

112.98

29.18

0.00

3577.40

3782.45

2398.13

85.75

1298.57

187.65

11.36

272.77

315.83

301.43

126.02

2262.20

2490.98

5180.63

3689.41

1491.22

0.00

3577.40

2011

297.10

2512.09

1988.80

102.56

59.15

0.00

4959.70

4294.57

2769.51

100.70

1424.36

274.53

17.31

160.45

409.28

437.09

25.20

4063.78

2291.70

6817.77

4144.00

2673.77

0.00

4959.70

2010

297.10

2089.39

1932.82

109.52

20.48

0.00

4449.31

4137.27

2651.49

93.83

1391.95

252.63

16.09

192.54

340.98

294.17

109.18

3919.96

1784.73

6108.04

3852.92

2255.12

0.00

4449.31

6108.04

192.54

340.98

16



CAPITAL EMPLOYED, NET WORTH AND RATIOS

(Rs. In Crores)

PARTICULARS

CAPITAL EMPLOYED

NET WORTH

PAID UP CAPITAL

NET WORTH PER RUPEE OF PAID

UP CAPITAL(RUPEE)

LOAN FROM CIL AND OTHERS

DEBT/EQUITY RATIO

NET PROFIT(Rs.Cr) (BEFORE PPA

& TAX)

NET PROFIT FOR THE YEAR AS %

TO CAPITAL EMPLOYED

NET PROFIT(Rs.Cr) (BEFORE TAX

BUT AFTER PPA)

NET PROFIT AFTER PPA AS % TO

CAPITAL EMPLOYED

DEBTORS AS % TO GROSS SALES

INVENTORY OF STORES & SPARES

IN NO. OF MONTHS CONSUMPTION

VALUE ADDED (Rs.Cr.)

VALUE ADDED /EMPLOYEE (RS.’000)

* NET PROFIT BEFORE TAX & AFTER PPA INCLUDES EARLIER YEAR’S PROVISION WRITTEN BACK.

2008-09

3153.90

2914.11

297.10

9.81

133.60

0.05:1

511.09

16.21

516.12

16.36

5.59

1.05

4426.82

708.38

2001-02

1855.65

981.96

297.10

3.31

597.91

0.56:1

324.75

17.50

310.20

16.72

19.37

1.37

2270.55

302.72

2002-03

1810.16

1239.67

297.10

4.17

549.77

0.44:1

478.63

26.44

472.53

26.10

26.06

1.33

2432.06

335.45

2003-04

1527.36

1562.62

297.10

5.26

363.80

0.23:1

741.67

48.56

743.60

48.69

21.40

1.56

2570.54

364.54

2004-05

1530.33

1788.04

297.10

6.02

148.02

0.08:1

917.09

59.93

935.30

61.12

15.74

1.25

3085.80

447.62

2005-06

2028.44

2304.21

297.10

7.76

135.49

0.06:1

1501.93

74.04

1446.96

71.33

8.44

1.04

3485.32

517.30

2006-07

2561.71

2650.31

297.10

8.92

122.97

0.05:1

1104.90

43.13

1054.44

41.16

8.01

1.05

3414.45

520.50

2007-08

2846.06

2814.14

297.10

9.47

112.98

0.04:1

920.07

32.33

930.22

32.68

5.73

1.09

3789.27

590.60

2009-10

3647.08

3099.86

297.10

10.43

109.52

0.04:1

941.84

25.82

931.03

25.53

3.90

1.06

4667.86

766.86

2010-11

4098.14

3236.58

297.10

10.89

102.56

0.03:1

1060.13

25.87

1067.97

26.06

2.08

1.10

4895.92

829.21

17


(Rs. In Crores)

PARTICULARS

SALES (Net of Statutory Levies)

OTHER INCOME

ACCRETION/DECRETION IN STOCK

EMPLOYEES REMUNERATION &

BENEFITS

CONSUMPTION OF STORES &

SPARES

POWER & FUEL

REPAIRS (PURCHASED)

CONTRACTUAL EXPENSES

SOCIAL OVERHEAD

DEPRECIATION

INTEREST

PROVISIONS

OTHER EXP :

OBR ADJUSTMENT

OTHERS

PROFIT/LOSS FOR THE YEAR

PRIOR PERIOD ADJUSTMENTS

PROFIT AFTER PRIOR PERIOD

ADJUSTEMENT

PROVISION FOR TAXATION

PROVISION FOR DEFERED TAX

(ASSETS/LIABILITIES)

PROFIT AFTER TAX

ADD EARLIER YEAR ‘S PROVISION

WRITTEN BACK

TOTAL PROFIT AFTER TAX

NOTE : FIGURES IN THIS STATEMENT ARE REARRANGED FROM THE PRINTED ACCOUNTS EXCLUDING CONTRAITEMS.

2008-09

5636.01

558.94

-34.22

6160.73

2967.70

872.72

229.09

126.62

536.10

239.99

176.44

3.97

-25.01

280.37

241.65

5649.64

511.09

5.03

516.12

224.15

-43.46

335.43

0.00

335.43


PROFIT & LOSS ACCOUNT

(EXCLUDING CONTRA ITEMS)

2001-02

3015.84

209.90

-40.38

3185.36

1199.41

486.32

169.21

68.48

211.73

151.10

175.47

62.00

177.65

-9.56

168.80

2860.61

324.75

-14.55

310.20

208.48

0.00

101.72

0.00

101.72

2002-03

3199.76

270.61

-10.41

3459.96

1199.94

530.26

184.15

82.92

231.57

154.34

173.31

46.72

255.94

-16.02

138.20

2981.33

478.63

-6.10

472.53

250.20

-57.45

279.78

0.00

279.78

2004-05

3941.35

287.38

62.52

4291.25

1646.44

667.85

186.41

98.32

331.40

189.83

170.91

8.29

-45.25

-7.60

127.56

3374.16

917.09

18.21

935.30

283.75

51.36

600.19

0.00

600.19

2005-06

4382.35

328.83

83.87

4795.05

1420.21

724.64

184.68

110.70

383.14

211.78

164.50

4.31

-133.00

35.16

187.00

3293.12

1501.93

-54.97

1446.96

472.03

-15.61

990.54

0.00

990.54

2006-07

4392.96

387.13

73.07

4853.16

1497.59

750.69

221.56

111.52

396.10

223.81

178.28

5.55

-19.07

158.57

223.66

3748.26

1104.90

-50.46

1054.44

391.70

-19.64

682.38

0.00

682.38

2007-08

4909.18

507.63

-54.08

5362.73

1910.02

762.88

225.63

117.40

491.84

228.14

185.65

4.33

45.68

262.77

208.32

4442.66

920.07

10.15

930.22

487.96

-169.52

611.78

0.00

611.78

2003-04

3359.74

440.08

23.87

3823.69

1358.21

564.80

189.21

109.14

244.85

180.69

182.92

25.22

57.93

15.26

153.79

3082.02

741.67

1.93

743.60

250.88

31.07

461.65

0.00

461.65

2009-10

5836.63

560.35

13.18

6410.16

2595.21

856.32

242.85

122.86

570.98

269.17

171.41

4.85

305.61

346.63

5468.32

941.84

-10.81

931.03

275.81

9.61

645.61

0.00

645.61

2010-11

5994.27

553.87

129.60

6677.74

2724.20

863.12

260.08

138.40

467.51

296.89

179.29

6.57

314.56

330.90

5617.61

1060.13

7.84

1067.97

559.29

-29.63

538.31

538.31

-17.57 36.09

0.00

19


To

The Members/Shareholders,

Western Coalfields Limited.

Your Directors have pleasure in presenting the

36th Annual Report of Western Coalfields Lim-

ited and Audited Accounts for the year ended

31st March, 2011 together with the report of

the Statutory Auditors and report and review

of the Comptroller and Auditor General of In-

dia thereon.

2. LOCATION OF UNITS :

The mines of your Company are located in

Maharashtra and South-West Madhya

Pradesh. For Effective administrative control

and operations, the mines have been grouped

in 10 (Ten) Areas is as follows :

3. PERFORMANCE :

During the year 2010-11 your Company has

achieved coal production of 43.654 Million

Tonnes, which is 2.846 Million tonnes less

than the AAP target of 46.500 million tonnes

and 2.081 million tonnes less than last year’s

actual of 45.735 million tonnes. Productivity

of the Company has gone up upto 2.65 tonnes

over last year’s 2.64 tonnes registering a

growth of 0.4%.

Overburden removal during 2010-11 was

115.824 million cubic meters against the tar-

get of 126.000 million cubic meters which is

10.176 million cubic meters less than the tar-

get and 18.141 million cubic meters less than

last year’s actual of 133.965 cubic meters.

DIRECTORS’ REPORT

Area District State Mines as on 1.4.2011

Chandrapur, Ballarpur,

Majri, Wani and Wani North

Pench and Kanhan

Pathakhera

Total Numbers of Mines- WCL 83

Chandrapur

& Yavatmal

Chhindwara

Betul

Maharashtra

Madhya

Pradesh

Madhya

Pradesh

Under-

groundOpencast Mixed

Nagpur and Umrer Nagpur Maharashtra 5

26

7

-

38

-

-

2

-

2

10

12

13

8

43

Coal Off-take during 2010-11 was 42.560 mil-

lion tonnes which is 3.940 million tonnes less

than the targetted 46.500 million tonnes and

2.949 million tonnes less than the last year’s

actual of 45.509 million tonnes.

3.1 Performance of Production (Coal and

Washed Coal), Productivity, Coal Sales

and Off-take against Annual Action Plan

(AAP) targets and as compared to last

year’s is given in the following table :

3.2 Coal Production and OB Removal

from Opencast Mines :

3.3 Mechanised Underground Coal

Production :

The Mechanised Coal Production fromUnderground mines during the year2010-11 was 8.228 million tonneswhich is 0.736 million tonnes less thanthe last year’s actual of 8.964 milliontonnes. Continuous Miner Technology,introduced at Tandsi and KumberkhaniMines, has resulted in coal productionof 0.207 million tonnes which has regis

PARAMETERS 2010-11 %Achie-vement

overTarget

i

ii

iii

iv

v

vi

Coal Production

(in Mill.Tonnes)

Overall Productivity

(OMS) (in Tonnes)

Total off-take

(in Mill.Tonnes)

Despatches (Sales)

(in Mill.Tonnes)

Washed Coal

Production (in M.T.)

Despatch to Steel

Plants (in Mill Tonnes)

46.500

2.62

46.500

46.411

0.2100

0.2100

2009-10Actual

43.654

2.65

42.560

42.536

0.1913

0.1930

93.9

101.1

91.5

91.7

91.1

91.9

45.735

2.60

45.509

45.503

0.2463

0.2448

Target

AAP

ActualSl.

no.

PARAMETERS 2010-11 %Achie-

vementover Target

i

ii

Coal production

( Million Tonnes)

Overburden Removal

( Mill. Cub. Mtrs.)

36.350

126.000

2009-10

Actual

34.950

115.824

96.1

91.94

36.114

133.965

TargetAAP

Actual

Sl.

no.

22


4.2.8 Area level committees have been con-stituted to conduct safety audit of themines to evaluate the safety status ofthe mines.

4.2.9 Bi-monthly meetings with Area SafetyOfficers are being conducted to evaluatethe implementation status of varioussafety measures in the mines. The mineinspection reports of Workmen Inspec-tors (in form U) and other officials areregularly monitored and rectification ofdeficiencies pointed out are ensured.

4.2.10 High powered multi-disciplinary taskforce consisting of Steering CommitteeMembers, CGM(S&C) and other seniorofficials of Hq. randomly visit mines toevaluate safety standards.

4.2.11For ensuring safety of workmen, 16numbers of highly sophisticated scientificinstrument like targetless totalstations have been provided to 16opencast mines of WCL.

4.3 Statistics of Fatal Accidents :

4.4 Statistics of Injury frequency :

* In 2009, the injury frequency earlier reported

as 168 has been revised to 176 after recon-

ciliation with DGMS statistics.

4.5 Technical Contribution in 2010-11 :

i) Vetting of all operational plans by ISO at Hq.

ii) RMR study for each development district

for support design.

iii) Risk assessment in all mines

Particulars

No. of fatal accidents

Persons involved

Rate per million tonne output

Rate per 3 lakhs manshift

2010(Calendar year)

2009(Calendar year)

11

14

0.32

0.26

11

13

0.28

0.22

iv) Accident enquiry in case of fatal & serious

accidents and enquiry into major dan-

gerous occurrences / incidents .

v) Analysis of all accidents and incidents

so as to decide preventive safe practices.

4.6 Special Achievements in 2010-11 :

i) Scientific studies have been conducted

in the following 6 mines by external

agencies during ’10-11.

a) DRC 6,7&8 – by National Institute

of Rock Mechanics (NIRM)

b) Saoner-2 – by National Institute of

Rock Mechanics (NIRM)

c) Umrer OC — by Central Institute of

Mining and Fuel Research (CIMFR )

d) NMC-3 – by Central Institute of Min-

ing and Fuel Research (CIMFR )

e) Silewara – by Central Institute of Min-

ing and Fuel Research (CIMFR )

f) Kumbharkhani – by Central Institute

of Mining and Fuel Research (CIMFR )

ii) To eliminate manual drilling, Mechanised

roof bolting has been introduced by de-

ployment of 32 departmental UDMs, 10

Hydraulic roof bolting machines and 19

Kargil machines. In addition to this, number

of contractual mechanised roof bolting

machines deployed are 18.

iii) To eliminate long and tiresome travel, two

Man Riding Systems are being used one

each in Tandsi 1&2 and Mouri Incline.

Installation and Commissioning of a

chairlift system has been completed in

Saoner-I mine. Further, installation of 3

chair lift systems and 2 rail car systems

in four mines of WCL, i.e, Shobhapur,

Chattarpur-1,Tawa-1 and Kumbharkhani

mines is in process.

4.7 Utilisation of Safety Budget : 2010-11

2010

(Calendar year)

186

4.24

3.41

Particulars

Injury frequency

Injury frequency Rate per

million tonne output

Injury frequency Rate per 3

lakhs manshift

2009*

(Calendar year)

176

3.85

2.99

Head

Budget

Expenditure

Capital

Rs. 465 lakhs

Rs. 167 lakhs

Revenue

Rs. 8800.00 lakhs

Rs. 8350.00 lakhs

23


5. RESCUE :

5.1 MAJOR ACHIEVEMENTS

5.1.1 GETTING ISO 9001:2008

CERTIFICATION :

During the year, your Company addedin its cap the prestigious ISO9001:2008 Certification when MinesRescue Station, Nagpur, the first Rescue Organization in India amongst allCoal and Metal Companies, obtained thiscertification.

5.2 Prompt Service in Emergency & Reopening

5.2.1 During 2010-11, Seven SpontaneousHeating, Ten Reopening operationsand one Life Saving have been dealt

successfully. The details are as under.

5.3 LIFE SAVING OF SHRI C.G.

KINHIKAR,ELECTRICIAN,UMRER

AREA :

5.3.1 In the early hours of 25th September,

2010 the Russian Dragline (15/90)at

Umrer Opencast mine was toppled due

to massive slide from the overburden

bench. The dragline toppled into the

sump trapping the operator and the elec-

trician inside. The operator was fatally

injured and the electrician Shri

C.J.Kinhikar was trapped waist down

within the mangled metal and mud

debris. The bench failure had also

breached theriver embankment and

water was fast rising in the sump threatening

to drown the trapped person. Racing

against time the rescue brigade from

Nagpur, using improvised tools rescued

the trapped person in time. The person

trapped inside the Dragline for a consid

erable period of time was rescued by

First-Aid trained rescue brigade and was

shifted to Area Hospital of Umrer Area.

Thus a precious life was saved.

5.4 COMPLETE RECOVERY OF NEW

MAJRI UG MINE :

Due to massive fire, the New Majri UG

mine was completely closed on

January’ 31st, 2010. Recovery works of

the mine was started in phased manner.

The mine was recovered completely

within a short period of fourteen months.

5.5 EXPANDING EXPERTISE TO CALIBRATE

GAS DETECTORS:

The importance of gas detectors in

mines needs no explanation. Though

maintenance and calibration of gas de

tectors are not in the ambit of our core

competence, two officers were trained

to calibrate Drager make and Oldham

make gas detectors.

This venture will result in considerable

positive financial impact as well as im

proving operation efficiency. The move

will have a direct yearly financial saving

of around 38 lakh rupees. Further the

acquired in-house expertise in these gas

detectors will increase the reliability as

well as availability of the detectors.

Sl. Date Colliery/Area ReasonsNo.01 20.04.10 to 24.04.10 NMC-3/Majri Partial Reopening of NMC-3 mine02 21.04.10 to 22.04.10 Mohan/Kanhan Spontaneous Heating

at E-2A Panel03 15.06.10 Saoner-2/Nagpur Spontaneous Heating

at E-1 A Panel04 08.08.10 Saoner-2/Nagpur Reopening of Panel (E-1A)05 22.08.10 Ghorawari /Kanhan Reopening06 05.09.10 Thesgora/Pench Reopening of sectionalized

Panel (NE-1 )07 08.09.10 Silewara/Nagpur Reopening of Panel (E-8)

of Seam-IIC08 25.09.10 Umrer OC/Umrer Rescue of Shri CG Kinhikar,

Elect. Trapped inside Draglinewhich had toppled into the sump

09 08.10.10 DRC/Chandrapur Spontaneous Heating atdevelopment Panel No.33

10 19.12.10 NMC-3/Majri Partial reopening of NMC-3 mine11 01.01.11to 02.01.11 Nehariya/Pench Reopening of sectionalized

area (NE-1) of seam No.412 07.01.11to 09.01.11 Mohan/Kanhan Spontaneous heating

at depillaring panel E3-A13 21.01.11 Saoner-2/Nagpur Spontaneous heating

at depillaring panel of Seam-V14 28.01.11 HLC-1/ Chandrapur Spontaneous heating

at 16LN/40D & 18LN40D15 17.02.11 NMC-3/Majri Partial reopening of NMC-3 mine16 20.02.11 to 22.02.11 R’khas/Pench Spontaneous heating

at sealed off area resultingin sealing off of the mine

17 09.03.11to10.03.11 NMC-3/Majri Partial reopening of NMC-3 mine18 28.03.11to30.03.11 3/Majri Reopening of NMC-3 mine- mine

completely recovered.

25


7.2 Performance of HEMMs :

7.2.1 Availability of HEMMs :

i) Dumper has achieved CMPDIL

Norms for availability.

ii) Availability of Dragline & Dumper is

more than CIL average, while the

availability of Shovel is equal to CIL

average.

7.2.2 Utilization of HEMMs :

i) Utilization of Dragline is more than

CMPDIL Norms.

ii) Utilization of Dragline, Shovel,

Dumper & Dozer in WCL is more

than CIL average.

7.3 Special Achievements :

7.3.1 WCL is ranked as 1st in utilization of

Dumper & Dozer, while 2nd in Dra-

gline & Shovel and 3rd in Drill

amongst all subsidiaries of CIL.

7.3.2 Equipment under breakdown for more than

3 Months (10.4 % of total population of

equipment as on 31st March’ 11) is the

3rd LOWEST amongst all subsidiaries

of CIL. Also, it is less than CIL average.

7.3.3 System Capacity Utilization of Open

Cast Mines of WCL :

7.3.4 System Capacity Utilization of Open

Cast Mines of WCL :

8. FINANCIAL PERFORMANCE :

8.1 The Company has earned a profit be

fore tax in the year 2010-11, Rs.1067.97

Crores as against Rs.931.03 Crores in

the previous year 2009-10. The financial

performance of the Company for the year

2010-11 vis-a-vis 2009-10 is furnished

below:

8.2 The working results for the year as com-

pared to the previous year are given

below :- (Rs. in crores)

905.15174.02

173.256.04

2 0 10- 11PARTICULARS

GROSS SALES

Less: LEVIES MAHARASHTRAMADHYA PRADESH

NET SALES

Less: EXPENDITURE - Net of Misc. IncomeGROSS MARGIN

Less: DEPRECIATIONIMPAIRMENT LOSS ON ASSETS

GROSS PROFIT

Less : INTERESTPROFIT BEFORE PPAAdd Less : PRIOR PERIOD ADJUSTMENTS

PROFIT BEFORE TAX

Add Less :Withdrawal of provision fordeferred Tax Assets/Liabilities

Less : PROVISION FOR TAXATIONPROFIT AFTER TAX

Add : PROFIT BROUGHT FORWARDDISTRIBUTABLE SURPLUS

7073.44

1079.17

5994.27

4748.281245.99

179.29

1066.706.57

1060.137.84

1067.97

29.63559.29

538.311932.82

2471.13

775.45135.55

166.924.48

2009-10

6747.63

911.00

5836.63

4718.541118.09

171.40

946.694.85

941.84-10.81

931.03

-9.61275.81

645.611843.91

2489.52

Year

2009-10

2010-11

Capacity

Utilization

111.43%

97.13%

Capacity in

Mill. Cu.m.

83.76

89.14

Remarks

Based on CMPDIL capacity as on

1st April, 2009.

Based on CMPDIL capacity as on

1st April, 2010.

(Rs. in crores)Sl. Particulars Amount AmountNo1 Profit before tax for the year 2009-10 931.032 FACTORS CONTRIBUTING TO DECREASE IN PROFITi Decrease in turnover due to decrease in volume 325.61ii Increase in normal Salary & Wages due to

increase in DA and increment 212.31iii Decrease in other income due to increase in

income in previous year for Mine block sale. 65.09iv Increase in power cost due to increase in price 38.68v Increase in provision for excise duty on coal stock 28.24vi Increase in provision for Bad & Doubtful debts

& other provisions 25.42vii Increase of OBR adjustments(Rs.8.94cr.),

Depreciation (Rs.7.88cr.) & Stores Cost(Rs. 7.06cr.) 23.88viii Decrease in surface transportation charges recovery 19.05ix Increase in Mine closure expenses(Rs.5.04cr.),

hire charges of vehicle (Rs.4.40cr) & hiring ofsecurity (Rs.6.59cr.) 16.03

x Provision for expenditure of re-opening of Umrer OC 14.58xi Increase in other misce. Expenditure net of

other income 7.37 776.263 FACTORS CONTRIBUTING TO INCREASE IN PROFITi Increase in net sales due to revision of price of coal

(Rs.240.81cr. for revision w.e.f.16.10.09 &Rs.17.78 cr. for revision w.e.f. 27.02.11) 258.59

ii Increase in net sales due to e-auction sale 224.66iii Accretion in coal stock due to increase in volume ,

price & Excise duty 116.42iv Decrease in contractual expenses mainly due

to hiring of equipments 103.47v Decrease in provision for PRP of Executives

(P.Y. w.e.f. 01.01.07 to 31.03.10) 71.02vi Extra expenditure in previous year due to shifting

of overhead line at Wani North Area. 45.08vii Interest from Customers (Rs.29.73cr.) & interest

from Income Tax Dept.( Rs.14.55cr.) 44.28viii Decrease in provision for 3% pension and 6.84%

superannuation benefit to Executives(P.Y. w.e.f.01.01.07 to 31.03.10) 26.04

ix Increase in other income for interest & subsidy 23.64 913.20Profit before tax for the year 2010-11 1067.97

26


APPROPRIATION :

8.3 Dividend :

Directors are pleased to recommend a

final dividend of Rs.323.25 Crores (previous

year Rs.387.42 Crores ) @ 108.80%

(previous year 130.40%)on the paid

up Equity Shares Capital of the Company.

The total dividend per share is @

Rs.1088.00 ( previous year Rs.1304.01

per share ) on 29,71,000 Equity Shares

of the Company.

8.4 Source and Application of funds :

9 . CAPITAL STRUCTURE :

9.1 Share Capital :

The Authorised Share Capital of your

Company is Rs.800 crores comprising

of 80 lakhs Equity Shares of Rs.1000/-

each of which Rs.297.10 crores is paid

up Equity Share Capital (29.71 lakhs

Equity Shares of Rs.1000/- each) which

remained unchanged during the year.

(Rs. in crores)

2010-11 2009-10

FINAL DIVIDEND 323.25 387.42

TAX ON DIVIDEND 52.44 65.84

PREVIOUS YEAR’S EXCESS TAX PROV.

ON DIVIDEND WRITTEN BACK -1.50 0.00

TRANSFER TO CSR RESERVE 27.39 6.60

TRANSFER TO GENERAL RESERVE 80.75 96.84

TRANSFER TO BALANCE SHEET 1988.80 1932.82

9.2 Loan Fund :

Unsecured Loans :

NOTES :

1) Loans from Coal India Ltd. amounting to

Rs.10256.38 lakhs comprises of :

a) Coal Sector Rehabilitation Project

from International Bank for Recon

struction and Development (IBRD) -

Rs.4707.38 lakhs.

b) Coal Sector Rehabilitation Project

from Japan Bank of International Co-

operation (JBIC) - Rs.5549.00 lakhs.

2) The loan amount of Rs. 10256.38 lakhs

includes adjustment of upward fluctuation

of foreign exchange to the tune of Rs.

623.00 lakhs .

3) A charge has been created for Rs.165.00

crores on current assets for securing

working capital facility from CIL’s Con-

sortium Banks as per joint deed of hy

pothecation dated 01.09.2008 . This loan

has, however, not been availed so far.

10. WORLD BANK ASSISTANCE :

Your Company has not received any

assistance directly from World Bank,

though assistance through Coal India

Limited , under ESMP and CSRP

Schemes to the extent of Rs.3.29 crores

(Previous year Rs.3.82 crores) has been

received during the year 2010-11.

11. BORROWINGS FROM GOVT. OF INDIA :

Your Company has not borrowed any

amount from the Government of India

directly during the year 2010-11.

Name of Balance Addition Repayment Balance SecurityFinancial as on due to during the as on details

Institution 01.04.2010 exchange year 31.03.2011fluctuation

(1) (2) (3) (4) (5) (6)(2+3-4)

CIL – World 10951.57 623.00 1318.19 10256.38 Ref.noteBank Loan 1& 2

TOTAL 10951.57 623.00 1318.19 10256.38

(Rs. in Lakhs)

(Rs. in crores)

SOURCES OF FUND 2010-11 2009-101 Addition to reserve & surplus 478.68 497.96

2 Addition to cumulative depreciation 118.01 112.343 Increase in impairment of assets 6.88 4.44

4 Decrease in investment 32.09 48.145 Increase in loans due to currency fluctuation 6.23 0.00

6 Increase in Deferred Tax Liabilities 38.67 5.26Decrease in Deferred Tax Assets 0.00 4.35

Total 680.56 672.49APPLICATION OF FUNDS :

1 Additions to fixed assets & capital WIP 179.20 185.602 Increase in working capital 418.66 459.66

3 Repayment of loans 13.18 12.494 Increase in discarded/surveyed off assets 1.22 2.86

5 Decrease in Loans due to Foreign CurrencyFluctuation 0.00 11.60

6 Increase in deferred tax assets 68.30 0.007 Decrease in Deposit for post-retirement

Medical benefit 0.00 0.28Total 680.56 672.49

27


12. CAPITAL EXPENDITURE :

During the year ending 31st March,

2011 an amount of Rs.239.74 crores

(excluding capital commitment of

Rs.61.74 crores) was invested in Fixed

Assets and Capital Work-in-progress of

existing and upcoming Mines/Projects.

The capital expenditure for the previous

year was Rs.252.34 crores.

13. ROYALTY, SALES TAX, ENTRY TAX,

EXCISE DUTY AND OTHER DUTIES

ON COAL :

13.1 Royalty, Sales Tax , Entry Tax , Stowing

Excise Duty , Clean Energy Cess and

Central Excise Duty paid to Govt.

during the year are as given below :-

( Note : Clean Energy Cess and Central Excise

Duty have come into effect wef 01.07.2010 and

01.03.2011 respectively )

13.2 By virtue of enactment of Cess & Other

Taxes on Minerals (Validation) Act,

1992, the Company raised supplemen

tary bills on customers upto 04.04.1991.

An amount of Rs.295.66 lakhs ( Previ

ous year Rs.295.66 lakhs ) has been

shown as liability for Cess on Royalty

under the head Current Liabilities &

Provisions. In view of the judgement

of the Hon’ble High Court, Patna,

Ranchi Bench in Writ Petition

No.CWJC/1280 of 1992, Cess is not

payable. However, a Special Leave

Petition (SLP) is pending in Hon’ble

Supreme Court against it.

14. PLANNING :

14.1 The production achieved during the year

2010-11 and targeted production for the

year 2011-12 is given below :

15. DRILLING & EXPLORATION :

15.1 During the fiscal year 2010-11, against

the target of 44000 mtrs. 42962 meters

of exploratory drilling was achieved by

CMPDIL. The achievement of drilling dur-

ing 2010-11 includes drilling in CIL

Blocks-21724 mtrs., in Non-CIL Blocks-

19920 mtrs. and promotional drilling of

1318 mtrs. 102.938 Million tonnes of coal

reserves has been proved in Borda &

Borda Extn Block.

The 2011-12 target for drilling in WCL,

Non-CIL Blocks and Promotional is 44500

mtrs.

16. R & D AND TECHNICAL STUDIES:

16.1 Research and Development and Technical

studies on Method of workings, support

design, hydro-geological Survey with

respect to U/G mine and Stability of workings,

Controlled Blasting, etc. for O/C

mines are being carried out on regular

basis as per difficulty being faced during

working in various mines of WCL,

through different Scientific and Research

Organisations like:-

1. Central Institute of Mining & Fuel

Research (CIMFR)

2. Central Mine Planning & Design

Institute Limited(CMPDIL)

Particulars

1 Production (in million tonnes)

2 Productivity (OMS)

2011-12

AAP Target

(As Per Annual

Action Plan)

45.50

2.54

2010-11

Target

46.50

2.62

Actual

Provisional

43.650

2.65

2010-11 2009-10

Royalty 96.02 499.82 595.84 102.85 512.71 615.56

Sales Tax:

State 38.84 148.19 187.03 26.46 187.03 31.60

Central 34.18 4.05 170.94 26.54 205.12 30.59

Entry Tax 10.61 0.00 10.61 5.48 0.00 5.48

S.E. Duty 6.99 36.39 43.38 7.05 38.27 45.32

Clean Energy Cess 21.98 117.54 139.52 0.00 0.00 0.00

Central Excise Duty 5.18 23.10 28.28 0.00 0.00 0.00

Total 184.76 851.50 1036.26 153.61 748.46 902.07

M.P. Maharashtra Total M.P. Maharashtra Total

(Rs. in crores)

28


3. National Institute of Rock

Mechanics(NIRM)

4. Rock Mechanics Technology Ltd.

R&D Projects carried out in 2010-11:

1. Study for Roof Behavior At DRC-

6,7 & 8 by NIRM

2. Study for adopting suitable method for

liquidation of standing pillars without

disturbing surface at Saoner-2 by

NIRM.

3. Study of High wall slope/Bench sta

bility at western pit of Umrer OC by

CIMFR

4. Study of stabilization work within 45m

of Railway siding at NMC-3 by CIMFR

5. Study of reducing possibility of occur-

rence of spontaneous heating &

ventilation planning at Silewara by

CIMFR.

6. Scientific Assistance and advise in

dealing the fire at NMC-3 by CIMFR.

7. Investigation for improvements in

ventilation as well as reduction in

possibility of occurence of spontaneous

heating & Ventilation planning at

Kumbarkhani UG by CIMFR.

17. REPORT FORMULATION :

17.1 During the year the following 11

Geological Reports were prepared

17.2 During the year following 9 Mining Project

Reports/Schemes were formu-lated/

recast :

17.3 PLANNING PREPAREDNESS:

17.3.1 24new mining projects wereenvisaged in Xth Plan, mainly to makeup the short fall in production fromexisting mines and completedprojects, with marginal growth.

The total capaci ty & product ioncontribution of these Xth Plan projectsis given below :

* Waghoda UG (0.39 Mty) and Junad Extn.OC (0.60 Mty) have been shifted to XI Plan,as CSA on Cost plus was finalisedon 18.04.2007.

** Saoner UG Mine No. III (with ContinuousMiner Technology), has been dropped, dueto insufficient balance reserve for deploymentof Continuous Miner.

17.3.2 Out of 21 X Plan project 5 projectshave been completed and rest 16 areOngoing Projects. Total 13 ongoingprojects of X plan are contributingproduction and remaining 8 projectscould not be started because physical possession of land could not betaken due to very high expectations of land compensation by landloosers ,which is beyond norms.

17.3.3 33 Projects have been identified for

XI Plan with a capacity of 44.95 Mty.

and anticipated capital of Rs.6578.01

crores , to sus ta in the ex is t ing

production level of Company.

S. No Name of Geological Reports

1. Murpar UG mine

2. Mungoli

3. Nirguda

4. Bhatadi

5. Nakoda UG to OC

6. Yekona II Extension

7. Visapur

8. Gondegaon Ghatrohan OCP

9. Rawanwara East UG

10. Ballarpur UG

11. Borda & Borda Extn.

S. Name of Project Capacity Captial

No. (Mty.) (Rs in Crores)

1 Wanoja OC (Yekona-I Extn.) 0.50 140.34

2 New Majri Sector-I (A) and II A Extn.OC 1.00 185.153 Shivani OC (Yekona-II Extn.) 1.25 201.52

4 Gandhigram UIG 1.200 289.755 Chichala-Chikalgaon Amalgamaged OC 3.00 501.34

6 Niljai Expn. Deep OC 3.00 414.027 Tawa-III UG 0.48 105.69

8 Amalgamaed Gondegaon-Ghatrohan OC 2.00 73.889 Motaghat OC 1.25 131.01

No. of

Projects

Capacity

(Mty.)

Contribution of

prodn. in2010-11 (M.Te.)

Capital

(Rs.Crs.)

Projects already approvedProjects shifted to XI Plan

Projects droppedTotal

212*

1**24

16.640.99

—17.63

10.4350.47

—10.435

968.534110.49

—1079.024

30


- PR of 1 project, namely Niljai DeepOC, WCL Board accorded Ist Stageapproval with permission to identify

prospective customer for enteringinto coal supply agreement on costplus basis

- PR of 1 Project namely, KampteeDeep OC - Board accorded FirstStage approval of PR to facilitate

application for Environmental clearances.

- PRs of 4 Projects, namely, Wanoja(Yekona-I) OC Chikalgaon/Chinchala OC, Gandigram OC andNew Majri Sec-I(A) & Sec-II(A), areunder process of approval.

- PRs 3 Projects, namely PadmapurDeep OC, Bhatadi Expansion-II OCand Shivani (Yekona-II Extn.), areunder recast at CMPDI.

For remaining 4 projects, for which PRsare to be formulated the status is as

given below :

For 3 projects, namely, Boarda UG,Nand UG, Murpar Expn UG Global Bidsare under finalisation for introduction ofmass production technology,

For 1 project i.e. Pauni Deep OC, the

exploration is under process.

From 6 Onoing projects of XI Plan, 5projects are contributing production. Theproduction during the year 2010-11 is4.151 M.Te.

18.1.2 Many of the New Projects/Schemes

are not viable at notified price of coal,even with Partial or Total Hiring ofEquipment.

18.1.3 In order to open new mines, whichare financially unviable following alternatives are being explored:-

a) Efforts are being made to planmines by total/partial hiring of equipmentat enhanced capacity ensuring minimum12 % IRR at 85 % capacity utilisationas per Govt. of India guidelines.

b) To enter into Coal Supply Agreementwith the consumers who are agreeableto pay the price yielding 12 % IRR at

85 % capacity.

c) Financially unviable projects are beingplaced on the Website of WCL. TheModel Coal Supply Agreement onCost Plus Basis is under finalisationat CIL.

18.1.4 Longwall / Mass production Technology:

Three Coal Blocks namely Nand (1MTY), Murpar Expansion (2 MTY) &Borda Block (2MTY) have been iden-tified for Development as Highcapacity Underground Mines. In

view of response from short listedparties, subsequent to EOI at CILlevel, Global bid document is beingprepared by CMPDIL. forretendering.

19. PROJECTS / SCHEMES APPROVAL

AND COMPLETION :

19.1 Approval of Project Reports :

During the year 2010-11, the following 9projects/ schemes have been approvedfor a total capacity of 15.03 MillionTonnes ( 2 underground projects of.1.23

million tonne capacity and 7 Opencastprojects of 13.80 million tonnes capacity)with a total Capital Investment of

Rs. 1671.24 crores:

S. Name of the Project Capacity Capital

No. (Mty.) (Rs in crs.)

A Final Approval

1 Amalgamaed Gondegaon-Ghatrohan OC 2.00 73.88

2 Scheme for Ukni OC 2.80 2.50B Ist Stage Approval

3 Kamptee Deep OC 1.50 174.19C Ist Stage Approval With

a permission to Enter into

Cost Plus Agreement

4 Ukni Deep OC 2.00 319.975 Sakhari-Irawati (Pauni-III) OC 1.25 360.806 Motaghat Deep OC 1.25 131.197 Tawa-II Expn. UG 0.75 89.008 Tawa-III UG 0.48 105.69D Ist Stage Approval With a

permission to Identify consumer

for entering into Cost Plus

Agreement on cost plus basis

9 Niljai Expn. Deep OC 3.00 414.02

Total 15.03 1671.24

31


19.2 Completion of Projects :

During the year 2010-11 Scheme for

Ghugus Deep OC has achieved the

norms of completion, and Completion

Report is under formulation.

19.3 Coal Supply Agreement (CSA) on negotiated

price to yield requisite IRR % for approval

of Project :

19.3.1 Total 27 Projects have been a

proved till 2010-11 on cost plus basis,

out of which Coal Supply Agreements

for 7 projects have already been signed.

6 projects, namely, Sharda UG ,

Harradol UG, Dhankasa UG, Dhuptala

(Sasti UG to OC ), New Majri UG to

OC and Dinesh OC, have been offered

to MAHAGENCO and MPPGCL on

cost plus basis for which in principle con

sent has been received.

After receipt of Model Coal Supply

Agreement for cost plus projects, which

is under finalisation at CIL, CSA for

above six projects would be finalised.

19.3.2Details of 13 projects, have been placed

on the Website of WCL and details of

One project is being placed on the

Website as per the guidelines of MOC.

19.4 Acquisition of land

19.4.1 The Coal Bearing Areas (Acquisition

& Development) Act, 1957 is the main

stay for acquiring land by the Central

Government and vested with WCL for

coal mining activities.The compensais

assessed by WCL as per the provisions

of the Act and disbursed after getting

sanction from the Ministry of Coal,

Government of India. All facilities

under the R&R Policy of CIL are extended

while acquisition through CBA (A&D)

Act, 1957, Under CBA Act, WCL has

acquired, since Nationalization

14786.60 Ha. of land till March, 2010

out of which 9563.16 Ha. is under pos

session.

19.4.1.1 The Land Acquisition Act has also been

invoked invariably for acquiring land by

our Company, which is done through

State Government on requisition by

Central Government. All facilities under

the R&R Policy of CIL are extended

under this acquisition also.

19.4.1.2 WCL has acquired, since nationali-

zation, 3996.36 Ha. land till March,

2010 out of which 3726.87 Ha. is under

possession.

19.4.1.3The provisions of Land Revenue Code

of Madhya Pradeshand Maharashtra have

also been referred for acquiring land in

cases where mining lease has been

obtained under Mineral Concession

Rules.

19.4.1.4 WCL has acquired and taken possession

of 1545.12 Ha. land under this provision.

19.4.1.5 This year your Company has made a

remarkable achievement in acquisition

of land for mining and allied activities.

The details of acquisition in 2010-11 is

as under :

S.No.

1

Capacity

(Mty)

1.50

Capital

(Rs. Crs.)

10.1456

Name of Project

Scheme for Ghugus Deep OC*

Sl. Area Project Mode of Total

No. acquisition

1 Chandrapur Durgapur Deep Extn. OC CBA 410.96

2 Majri Telwasa Extn. Block CBA 21.00

2 Dhorwasa Extn. Block CBA 79.04

2 Deulwada CBA 3.59

3 Umrer Gokul OC CBA 740.85

4 Wani Penganga OC CBA 743.83

Kolgaon CBA 51.42

Total : 2050.69

32


19.4.2 Details of physical possession during

2010-11 is as under

19.4.2.1 Suumerised Status of land acquired

during the year 2010-11 is as under :-

19.4.3FOREST LAND ACQUISITION

Forest land is diverted from State

Government as per the provisions of

Forest Conservation Act, 1980 after

approval from MOEF, New Delhi. This

year 2.34 Ha. of forest land diverted for

33 KV HT Line for Pench Area.

Details of forest land acquired during

2010-11 is as under :

IInd stage clearance obtained:

For surface rights -

Pench Area - 33 KV HT Line - 2.34 ha. on 16-8-2010.

1st stage clearance obtained:

For underground rights -Pench Area - Rawanwara Project

(Renewal) - 657.367 ha. on 20-10-2010.

Kanhan Area - Harradol Project - 35.85 ha. on 23-9-2010

Total - 693.217 ha. (U/G)

Ist Stage clearance obtained:

For Surface Rights -

Kanhan Area - Sharda Project - 9.50 ha. on 23-6-2010.

Kanhan Area - Harradol Project - 4.85 ha. on 23-9-2010.

Total - 14.35 ha. Surface

19.4.4 Rehabilitation

10 Families of Ghugus OCP, Wani Area ,

1 family of Padmapur OC, Chandrapur

Area are resettled at the resettlement

site developed with all civic amenities

as per the provisions of R&R Policy and

23 families of Takia nala of Kanhan Area

has been provided resettlement grant

as opted by land oustees, within the

provisions of R&R Policy.

Total Project Affected Families Resettled

2010-11- 34 Nos.

Administrative approval for employment during

2010-11:

19.4.5Special Achievement:

There is 915% growth in land acquisition

over last year and highest over

acquisition since last 20 years

There is 25.44% growth in possession

of land over last year and highest over

since last 5 year .

19.4.6 Constraints in acquisition of land

(i) Demand of higher rate of land

compensation by land owners.

(ii) Demand for employment

beyond norms.

(iii) Physical possession of land

becomes extremely difficult due to

(i) and (ii) as above.

(iv) Pursuance of State Authorities to

implement State's R&R Policy

instead of that of CIL.

(v) High expectations in resettlement

and rehabilitation beyond norm,

causing resettlement of village over

delayed.

Details Total land Land taken in

acquired pssessionUnder LA Act, CBA Act, MPLR 2050.69 327.02

and Direct Purchase.T O T A L : 2050.69 327.02

Year Employment/ Employment Monetary Total

monetary compensation provided compensationadministratively approved provided

by WCL Board

2010-11 225 Nos. 208 Nos. 55 Nos. 263 Nos.

Sl. Area Project Mode of Tenancy Govt. Forest TotalNo. acquisi

-tion

1 Ballarpur Extention ofBallarpurOC LA 16.2 0 0 16.2

Gouri Deep OC CBA 194.17 0 0 194.17

Sasti Extn. OC CBA 9.71 0 0 9.71

2 Umrer Makardhokra-II LA 2.53 0 0 2.53

2 Makardhokra-I LA 49.25 0 0 49.25

3 Wani Junad CBA 3.26 0 0 3.26

3 North Kumbhar-khani CBA 12.51 0 0 12.51

4 Majri Juna Kunada CBA 39.39 0 0 39.39

Total : 327.02 0 0 327.02

34


revenue generation during 2010-11, isReserve Price being 130% of NotifiedPrice, which during 2009-10, was at parwith the notified price.

20.4.1.1 Additional Revenue Generated

During 2010-11, considering thequantities allocated to the successfulbidders, as communicated by theservice providers, the total of Rs.613.40crs. was generated additionally underSpot e-Auction.

20.4.1.2 Forward e-Auction

For the year 2010-11, four Forwarde-Auctions have been held coveringthe four quarters of the year. Whereas,no bid was received against any of thequarters and sources during first twoe-Auctions, some quantities againstthe offer was secured by theconsumers during the auctions forOct. 2010 onwards, when the ReservePrice was lowered to 160% of theNotified price.

21. CONSUMER SATISFACTION:

WCL has adopted various measuresto ensure supply of quality coal to theconsumers, as brought out hereunder:

21.1 Quality of Coal:

21.1.1 The overall Grade materialization of yourCompany during the period 2010-11 hasimproved to 92.39% as compared to89.51% achieved last year. As a resultquality deduction has been reduced toRs. 5.06 per tonne in 2010-11 as againstRs. 15.32 per tonne in 2009-10. 100%Joint/Agreed Sampling has beenachieved in 2010-11.

20.2 WAGON LOADING (IN BOXES/DAY)

The details of AAP Target, Loading on

aily average basis & quantity

despatched for the year 2010.11, as

compared to 2009-10 are as under :-

Remark : Despatches by Rail during 10-

11 was less as compared to 09-10

as 7.92million tonnes of coal was

drawn by MAHAGENCO Power

houses through washery circuit

during 10-11.

20.3 Sales Realisation :

20.3.1 Sales realisation during 2010-11 was

Rs.7314.00 crores which represents a

growth of 4.08% over the previous year.

Sales realisation during 2009-10 was

Rs.7024.44 crores.

20.3.2 The total sales outstanding dues which

was Rs.263.31 crore as on 01.04.2011

has decreased by 44.05% to the level

of Rs.147.32 crores as on 31.03.2011.

The reduction in outstanding is mainly

in respect of the major Power Houses.

20.4 Sale of coal through e-Auction

20.4.1Spot e-Auction :

Quantity offered under Spot e-Auction,

quantity allocated and additional revenue

generated based on the quantities

allocated to the bidders during the years

2009-10 and 2010-11, as communicated

by the service providers, are given

below :

As compared to the year 2009-10,realisation during the year 2010-11increased by Rs.306.09 crs. One of themain reasons for increase inadditional

YEAR TARGET ACTUAL% Achievment Rail Desp.

in MT

2009-10 908 907 100 21.077

2010-11 916 765 84 17.908

Year Quantity offered Quantity allocated Additional Revenue

(lakh tonnes) (lakh tonnes) (generated (Rs.in crs.)

2009-10 56.13 53.19 307.31

2010-11 59.59 58.16 613.40

“Forward e-Auction Quantity Quantity Addl. Revenue Remarks

Years for which offered allocated generated allocated

”conducted were (in lakh tes) (in lakh tes) in (as per the qty.

auctions) e-auctions

(Rs. in crs)

April’10 toMarch’11 6.51 Nil Nil No bid

received

July’10 to June’11 6.27 Nil Nil No bid

received

Oct.’10 to Sept’11 6.43 0.75 6.89 -

Jan.’11 to Dec’11 5.31 0.79 7.91 -

35


21.3 Crushing:

The installed annual crushing capacity

for Open Cast mines is 46.20 million

tonnes.

21.4 Quality Dispute Redressal:

a) In 2010-11, total 118 complaints

have been received. The complaints

are of lumpy coal, extraneous

material and wet and sticky coal.

b) Complaints received are registered,

acknowledged, investigated and

corrective remedial measures are

taken on top most priority for

redressal.

c) Regular feedback obtained to

maintain high quality standards.

d) Remedial measures taken are as under:

Following measures are taken at Area

evel to improve the quality of coal supplied to

the consumers to minimize the complaints:

1) Selective mining

2) Deployment of sufficient pickers at

faces Stock and Siding to separate

extraneous materials from coal

3) Proper cleaning and maintenance of

siding

4) The crushing facilities are provided

at the mines/at loading points to

despatch sized coal

5) All weighbridges of WCL are

regularly calibrated and stamped by

Weights and Measures Department

for proper weighment.

22. TELECOMMUNICATION :

22.1 Existing Telecommunication Systems:

WCL has an efficient Telecommunication

network as detailed below :

22.1.1Surface Communication :

i) VOICE & DATA Communication:

WCL (HQ) has an efficient voice

and data communication network

21.1.2 Against coal supply to Maharashtra

State Power Generation Company

Limited (MAHAGENCO) from

Durgapur Deep Extension/Bhatadi O/C

and Kolgaon O/C on cost plus basis-

mines, incentive of Rs. 215.00 per tonne

and Rs. 16.00 per Tonne respectively

has been earned during the period April,

2010 to March, 2011.

21.1.3 The grade materialization of coal

supplies to Gujarat State Electricity

Corporation Limited (GSECL) and

Karnataka Power Corporation Limited

(KPCL) are 99.75% & 100%

respectively

21.1.4 The weighted average Useful Heat

value (UHV) of coal supplied to following

Power Generating Companies was

more than the required UHV, as per

boiler parameters during 2010-11

21.1.5 The average monthly generation of

Maharashtra State Power Generation

Company Limited (MAHAGENCO)

during April' 2010 to March' 2011 is

3035.518 MU as compared to 3404.347

MU generated during April' 2009 to

March' 2010.

21.1.6 Penalty for supplies of clean coal from

Nandan Washery to Bhilai Steel Plant

was Rs 448 lakhs during 2010-11 as

compared to Rs. 638 lakhs during 2009-10.

21.2 Weighment :

Total 93 Electronic Road Weighbridges

and 24 Rail Weighbridges are working/

operational and Overall weighment

percentage during 2010-11 was as under:-

Power Sector Required UHV Supplied UHV

K.cal/kg k.cal/kg

Maharashtra State Power 3250/F 3681/E

Generation Co. Ltd (MSPGCL)

Madhya Pradesh Power 3348/F 3875/E

Generation Co.Ltd (MPPGCL)

YEAR BY RAIL BY OTHER MODES OVERALL

Target% Actual% Target% Actual% Target% Actual%

2010-11 98.00 99.92 100.00 100.00 99.08 99.96

36


connecting various locations such asArea HQ to Sub Areas/Mine/WeighBridges etc., & also considering to

enhance IT infrastructure facilities in thecompany as a part of IT infrastructureplan initiated by CIL, Kolkata.

22.4 WCL propose to introduce latest state-of-art TETRA based digital radiocommunication system at Durgapur OC

mine, Chandrapur Area for Voice &Messaging to enhance operationalcommunication in the mines.Subsequently, the same will beimplemented in other mines ofcompany.

22.5 Comprehensive AMC for 33 nos of UGAuto cum Manual telephonesystemsworking in different UG minesof WCLhas been finalised for further 3 yearsperiod.

23. COMPUTERISATION :

23.1 Status of activities planned for 2010-11

Sl. Particulars of Activities StatusNo.

1 Development of Software for File Tracking Systemcomprising of File Receipts and dispatches. Achieved

2 Development of Tender Status Monitoring Systemfor Materials Management Department. Achieved

3 Development of Integrated Workshop ManagementSystem for CWS, Tadali integrating all the Job Order

related activities of Production Shop with Planning,Stores, Accounts and Personnel Department. Achieved

4 Development of Browser based intranet site for entireWCL employees (WCLNET) covering status of personnel

details, inventory status like stock , consumption, usefulCirculars , internal mailing . Achieved

5 Uniform computerization of Credit Note and Debit Notefor Coal Sales Billing across all the Areas. Achieved

6 Development of Software for Standardization of Coalsales Billing and Tax Register across all the Areas of WCL. Achieved

7 Development of Software for integration of Cash Bookwith Final Accounts. Achieved

8 Development of Package for preparation of Area CostSheet at Area Level and its consolidation at Headquarter

level including Cost and Financial reconciliation basedon annual audited accounts. Achieved

9 Computerisation of Cash Book for Fuel Supply Agreement(FSA) and e-auction accounts (EFT mode payment). Achieved

10 Preparation of Software for Online Journal Voucherthrough Integrated Financial Information System (IFIS)

package. Achieved11 Preparation of Software for Advances Ledger and Sundry

Creditors Ledger Achieved12 Development of Interface Software for Financial

Accounting and Online Material Management System. Achieved13 Development of Software for Centralized Gratuity

Processing for all Areas. Achieved

connecting WCL HQ with AreaHqrs. Stores through BSNL leasedlines.

ii) During 2010-11 total 4 Nos. of stateof art IP EPABX systems have beenordered and is under installationprocess at Sasti O/C BallarpurArea, KPOC Wani North Area,

Chattarpur II Patherkhera Area &Area Hospital Kanhan Area,

iii) A 2 Mbps leased internet service atWCL HQ is in operation catering theneed for various applications suchas tender uploading, e-auctioning,

web browsing etc.

Presently 3 nos of telemonitoringsystems are in operation at Naglone,DRC & Ballarpur 3 &4 pits to monitorenvironmental condition in UGmines including continous

measurement of Carbon Monoxide,Methane, Oxygen & Temperature.The telemonitoring system at NMC-3 mine & Naglone mine has beenrestructured with independentsurface monitoring.

22.1.2Underground communication :

During 2010-11 total 3 nos. of Auto-cum-Manual telephone systems ofunderground mines have been installed& commissioned at Sasti & Ballarpur

3&4 pits of Ballarpur Area andChattarpur I mine of Pathakhera Area.

Further procurement of one no. Autocum Manual telephone system for NMC-3 mine likely to be ordered &commissioned soon.

22.2 Monitoring of Under ground Mine

Environment :

It is proposed to install & commission 2nos of environmental telemonitoringsystem at HLC & Mahakali UG mines

of Chandrapur Area during the year2011-12 to improve safety of the mines.

22. 3 WCL propose to implement IP Radioand other state-of-art systems for

37


and spares in respect of last three years

is as under :

25.3 To have better control over inventory

and consumption 31 charged off stores

have been computerised.

25.4 LONG TERM AGREEMENT :

Your Company has entered into a long

term agreement with M/s. IOC Ltd. for

supply of HS Diesel w.e.f. 01.04.2009

valid upto 31.03.2014. Discount of Rs 50/- per

KL is offered by M/s. IOC, as per this

agreement resulting in savings of

approximately Rs. 50 Lakhs per annum

towards purchase of HSD.

25.5 SPECIAL AGREEMENT :

25.5.1Your company has entered into a MOU

with M/s. SAIL for supply of various

types of Iron & Steel materials w.e.f.

01/04/2011. The validity of the MOU

isupto 31/03/2012. The approved off-take

value is Rs. 41 Crores for an approx.

quantity of 10000 Mts of the materials .

Your company is first amongst CIL

subsidiaries to have such an

arrangement for smooth supply of Iron

& Steel materials.

25.6 E-PROCUREMENT :

25.6.1WCL has introduced e-tendering

with e-price bid with effect from

September 2009 and during the year

2010-11 as a further improvement

system, e- tendering with e-price bid

followed by reverse auction has been

introduced. So far, 109 e-tenders have

been hosted with an estimated tender

value of Rs. 210.00 Crores.

(Fig. Rs. in Lakhs)

Sr. No. Financial Net Annual Inventory in % ageYear Inventory Consumption terms of change in

months inventoryconsumption

1 2008-09 6117.12 87534.37 0.84 (-) 05.62

2 2009-10 6206.01 85813.50 0.87 (+) 03.57

3 2010-11 6091.40 86519.43 0.85 (-) 02.30

23.2 Activities planned for 2011-12

1. Development of Centralized

Performance Incentive Computation

Software for FSA consumers.

2. Development of Uniform Sales

Report based on class / type of Coal

and nature of Sale across all the

Areas of WCL.

3. Development of Daily Attendance

System for use in Unit Level on

Oracle Platform.

4. Decentralization of Tender

Uploading across all the Areas of WCL.

5. Segment Report of Balance Sheet

and Profit and Loss Statement.

6. Closing Stock valuation of Final

Accounts.

7. Redesigning of WCL Website to

Dynamic mode.

8. Online Vigilance grievance redressal

System.

24. ROLE PLAYED BY YOUR COMPANY

IN DEVELOPMENT AND

SUSTAINING SMALL SCALE

INDUSTRIAL UNITS :

24.1 WCL, a key Public Sector Company in

this region, is making all efforts in

development of Small Scale Industrial

units in Vidarbha Region. This is evident

from the fact that upto the year 2010-

11, 39 small industrial units were

ancillarised which qualifies them for

securing orders from WCL (HQ) as well

as Areas.

25. MANAGEMENT OF INVENTORIES :

25.1 WCL has maintained its position at the

top (amongst CIL subsidiaries) in

respect of Inventory Management.

25.2 Comparative position of net inventory

vis-a-vis annual consumption of stores

38


26.2.2 Out-Company Training :

a) In India - Out-Company training

including Gandhi Labour

Foundation(GLF), Puri is an

important activity of HRD

department, through which

improvement in efficiency and

productivity of employees is sought

by sharpening their managerial,

technical and functional skills. For

this purpose, the employees are

nominated to attend training

programmes organised by various

Educational Institutes such as

Indian School of Mines

University,Dhanbad, Indian

Institutes of Technology, National

Institutes of Technology, various

organisations such as Indian

Institute of Industrial Engineering,

Indian Institute of Materials

Management, National Productivity

Council, MGMI, National Institute of

Personnel Management (NIPM),

GLF Puri etc and also Original

Equipment Manufacturers such as

BEML, L&T etc.

The breakup of executives,

supervisors and workers sent for

out-company training is as given

below :

b) Foreign Training : Apart from

various types of Out-company

training in India, employees are also

sent abroad for different types of

study tours, trainings, development

courses, international Exhibitions /

Expo etc.

In the year 2010-11, 10 Executives

participated in such programmes.

Executives Supervisors Workers TOTAL

Out-Company Training

(including GLF, Puri) 212 34 34 280

25.7 MODEL DEPOT AGREEMENT :

WCL has finalised Model DepotAgreement with M/s. Bharat PowerCorporation Limited for supply oftransmission and electrical sparesbeing the lead company nominated byCoal India Limited.

26. HUMAN RESOURCES MANAGEMENT :

26.1 Manpower :

The Company's manpower as on31.03.2011 as compared to that on31.03.2010 is furnished below :-

26.2 Human Resource Development (HRD) :

26.2.1 In-Company training :

In-Company training plays a vitalrole in the honing of skills and overalldevelopment of Human Resources.Four Institutes viz. ManagementDevelopment Institute (MDI),Nagpur,Supervisory Training Institute(STI),Chhindwara, Workers TrainingInstitute (WTI),Wardha and HEMMTraining Institute, Durgapur cater to theneeds of functional, cross-functionaland other training courses of theexecutives, supervisors and workers.

The break-up of number of executives,supervisors and workers trained in2010-11 in the four Institutes is asgiven below :

NUMBER OF EXECUTIVES TRAINED AT

IICM, RANCHI -120

Sl.. Category Manpower as on Increase (+)/

No. 31.03.2011 31.03.2010 Decrease (-)

1 Executive 2409 2196 213

2 Supervisor 5675 5908 (-) 233

3 Clerical 3922 4251 (-) 329

4 Highly Skilled / Skilled 28765 29371 (-) 606

5 Semi-skilled / Unskilled 17709 18738 (-) 1029

6 Company’s Trainee 563 406 157

T O T A L 59043 60870 (-)1827

INSTITUTES Executives Supervisors Workers TOTAL

Management Development 859 38 72 969

Institute (MDI),NagpurWorkers Training Institute 0 69 139 208

(WTI),WardhaSupervisory Training Institute 0 295 296 591

(STI),ChhindwaraHEMM Training Institute, 43 104 933 1080

Durgapur

TOTAL 902 506 1440 2848

39


26.2.6 Training of SC / ST / OBCs : Training

for upliftment of SC/ST/OBCs are an

important thrust area.

2765 SC, 1654 ST and 5250 OBC

employees were given training (in-

company & out-company) in different

Skill Improvement courses.

26.2.7 Management Trainees :

72 Management Trainees (Civil- 03,

E&M- 15, E&T - 01, Excv -12, F&A -14,

HR/P - 09, Min- 15, S&M -02, Systems-

01), inducted in the year 2010-11 were

put in 'On-the-job' training in their

respective fields.

27. SCHEDULED CASTES AND

SCHEDULED TRIBES/OBC :

27.1 As on 31/03/2011, the details of number

of employees including the number of

SC/ST/OBC is furnished below:-

27.2 The Presidential directives of SC/ST

and OBCs are being implemented in

respect of recruitment as well as in

promotion.

28. WORKERS' PARTICIPATION IN

MANAGEMENT :

28.1 The Steering Committee at Company

level comprising of CMD, all Functional

Directors and Trade Union

representatives of five central trade

unions viz. INTUC, BMS, AITUC, HMS

and CITU and CMOAI is functioning

smoothly.

Sr Examination No. of employees

No. passed

1 1st Class Mine Managers Certificate 32

2 2nd Class Mine Manager Certificate 29

3 Overman Certificate 22

4 Mining Sirdar Certificate 32

5 Surveyor Competency Certificate 5

TYPE OF TRAINING NO. OF WORKERS /SUPERVISORS TRAINED

1. INITIAL TRAINING 763 2. REFRESHER TRG 8312

3. SPECIAL TRG 1553 4. AREA BASED TRAINING 5348

5. CONTRACTORS’ WORKERS TRGa) Initial training 2599

b) Refresher training 534c) Area based trg 296

6. TRG. FOR SUPERVISORS(as per 8th / 9th Safety Conf.)

a) Mining 196b) E&M 69

c) Excv 40

26.2.3 Safety Training :

Under VT rules, various trainings such

as Initial, Refresher and Special

trainings are imparted to the workers

working in mines. This purpose is

fulfilled by 12 Vocational Training

Centres (VTC) in different areas.

Alongwith this, the Contractors'

workers, who play an important role

in today's scenario, are also imparted

Initial and Refresher training. As per

recommendation of 8th / 9th Safety

Conference, the supervisors are

provided Safety training in the

respective Institutes. The break-up of

various types of safety training is as

given below :

26.2.4 Training Under Apprentice Act :

This year, 289 apprentices were

engaged in various trades such as

Fitter, Electrician, Materials Handling

Equipment Operator-cum

Mechanic(MHEO) against the quota of 261.

26.2.5 Coaching for Statutory Examination :

To make up shortfall of Statutory

Manpower, extensive coaching was

conducted at MDI, Nagpur for 1st

Class Mine Managers Certificate of

Competency and at STI, Chhindwara

for 2nd Class Mine Manager Certificate

of Competency, Mining Sirdar,

Overman, Surveyor. Following number

of employees passed out statutory

examinations.

Total No. of employees SC ST OBC

as on 31/03/2011

59043 11643 4310 15453

40


on 07/09/2010 (one day) over five

points charter of demands on

National level issues.

(3) Joint strike call given by two unions

viz. BMS & HMS on 18/10/2010

(one day) over two points charter

of demands on Industry level issues.

29.3 Voluntary Retirement Scheme (VRS):

The scheme was kept under

suspension w.e.f. 30/9/2007 due to

requirement of manpower.

29.4 Recruitment made during 2010-2011:

Mining Sirdar .. 91

Overman .. 72

Staff Nurse .. 50

29.5 Promotions given during 2010-11 :

As part of carrier care of employees,

the following number of non-executives

have been given promotion:

Non-Executives

a) Excavation personnel .. 1016

b) Non-excavation personnel .. 2171

TOTAL 3187

30. WELFARE MEASURES AND SOCIAL

AMEMITIES :

30.1 Group Gratuity Scheme :

30.1.1 The Group Gratuity Scheme is in

vogue with effect from 10th March,

2003. The actuarial liability as on 31/

03/2011 is Rs. 1,535.03 crores. The

trust has earned an interest amounting

to Rs. 135.90 crores in the year 2010-11

@ 9.60%.

30.1.2 During the financial year 2010-11 LIC

reimbursed Rs.177.19 crore towards

Gratuity and paid Rs.5.81 Crores

towards life cover to nominees of

deceased employees.

Law & order incidents 2009-2010 2010-2011

Relay Hunger Strike Nil Nil

Gherao Nil Nil

Assault Nil Nil

Dharna/Morcha/Demonstration 2 Nil

Total 2 Nil

Strike/Work Stoppage

No. of strikes Nil 03 **

Mandays lost Nil 25590

Production loss (Te.) Nil 44000

The broad functional areas of the

Steering Committee includes:

Formulation and evaluation of Action

plans/budgets;

Resources utilization

Cost/profitability

Quality of coal

Safety

Employees' welfare and

Environmental protection

28.2 The periodical meetings of the Steering

Committee were held regularly which

not only helped in inducing cordial

industrial relations but also in achieving

organizational goal.

28.3 Employment to dependants :

440 persons were appointed under the

provisions of NCWA under clause

9.4.0/9.3.2 during 2010-2011.

29. INDUSTRIAL RELATIONS :

29.1 Industrial Relations scenario in WCL

during the fiscal 2010-11 has been

peaceful, cordial and harmonious.

29.2 Status of Industrial Relations situation

for the last two years is given below:-

** (1) Strike call given by LZCMMU

(CITU) Union on 5/05/2010 (one

day) over 13 points charter of

demands on Industry level issues.

(2) Joint Strike call given by four unions

viz. INTUC, AITUC, HMS & CITU

41


Sl. No. Details As on 31.03.11

1 Houses- Standard -42515

Non-Standard -10086 526012 Water Supply (Population covered) 323795

3 Schools (receiving recurring, non recurring grantsor infrastructural facilities) 101

4 Co-operative Stores 245 Co-operative Societies 45

6 Bank Branches/ Extension Counters 1137 Ambulances 111

8 Dispensaries 549 Hospitals 11

10 Canteens 7911 Gymnasiums 27

12 Stadium 13

30.2 WELFARE AMENITIES:

30.2.1Following are the details of various

amenities for the welfare of our

employee:

30.3 Medical Services :

30.3.1 WCL incurred total expenditure of

Rs.42.97 Crores on Medical services

during the year 2010-11. This includes

expenditure on outside referrals

amounting to Rs.24.04 Crores for

super-specialized treatment to our

employees and eligible dependents.

Shaping the future - Children in one of the WCL aided schools.

30.3.2 The per capita expenditure in 2010-11 was Rs.7060.18 as against theprovision of Rs.2,000/- under NCWA-VIII.

30.4 Family Welfare:

30.4.1 During 2010-11, Company'sachievement was remarkable inFamily Welfare Programme in whichan overall 3229 operations (TT+VT)were performed, out of which 23family planning camps wereconducted at different Areas with 999beneficiaries & 62 camps were heldin coordination with State HealthAuthorities in which 2230 were thebeneficiaries.

30.5 Other Medical camps under C.S.R.:

30.5.1 218 Medical camps, such as, eye,village check-up etc. (including familyplanning) under Corporate SocialResponsibility with 35,335beneficiaries, were organized during

the year.

44


34. PROGRESSIVE USE OF HINDI 2010-11

34.1 In accordance with Official Language

policy of Government of India, under

the efforts made during 2010-11 for

popularising the use of Hindi in the

official working and progressive use of

Hindi in the Company, 8 Rajbhasha

Workshops were organised, in which,

198 officers/employees participated.

In these Workshops, they were

acquainted with Official Languages Act

and Rules and Rajbhasha targets and

they also got practiced for Hindi noting,

drafting and Hindi correspondence etc.

34.2 In the year 2010-11, a meeting of

Official Language Implementation

Committee was held in each quarter

regularly. Thus, 22 meetings of the

Committee were held during the year,

in which, Hindi progress and steps

taken to achieve Rajbhasha targets

were reviewed.

34.3 During the year, 38 offices of WCL

were inspected. During the inspection,

progressive use of Hindi and

compliance of Official Language Act

and Rules were reviewed.

34.4 During the year, "Aaj Ke Shabd" were

continuously displayed near entrance

of the office building and this is

continuing. The same is also being

displayed in the Areas of WCL.

34.5 During the year, 5 issues of "Khanan

Bharti", CIL's representative Hindi

magazine published from WCL, were

brought out, in which, articles etc. of

the employees of the Company

published. 3 issues of bi-lingual

magazine "Pragati" were published. 23

issues of Hindi fort-nightly "Wall

Poster" were published, in which,

activities and achievements of WCL

were highlighted.

34.6 On the occasion of "Hindi Diwas",

Rajbhasha Week was observed from

33.2 Computerization of Process of

Pension Claim :

Complete computerization have been

made in respect of the processing of

current pension claims by WCL and

all the pensioners are being given

Pension Calculation sheet. The

Pension Data is captured for future

reference for all the claims forwarded

to CMPFO.

33.3 Settlement of PF and Pension in the

month of superannuation under

'Mission Biswas' :

33.3.1 The following is the position of

Settlement of PF and Pension Cases

from April,2010 to March,2011 under

Mission Biswas:-

33.4 Pension Helpline :

Pension Helpline is in operation for

solving the problems being faced by

the Pensioners, if any. During the

Current Financial Year, total number

of 505 calls received including

grievance letters out of which 498

cases have been replied and cleared

and balance cases being persuaded

with CMPFO and concerned

Nationalized Banks. The Pensioners

have been encouraged to make

maximum use of Helpline and sincere

and dedicated efforts have been made

to sort out the problems of Pensioners

over Helpline.

33.5 Submission of VV Statement for the

year 2010-11 :

The V V statement for the currency

period ending 31.03.2010 has been

submitted by all the Units/ Areas

under Regional Commissioner,CMPF,

Nagpur & Chhindwara.

NO OF EMPLOYEES NO. OF CLAIMS BALANCE

SUPERANNUATED FROM/ SUBMITTED TO CMPFO’

APRIL,2010 TO MARCH,2011 OUT OF ‘A'

A B C

2103 2085 18 (Disputed)

45


taking due action for Environmental

Protection and Pollution mitigation

measures in all operating mines. Status

of the different activities under

environment management as on 31-

03-2011 is as under:

35.1.1 Annual Action Programme (AAP)

Annual Action Programme for

Environment Management Plans for

the year 2010-11 was finalized after due

consultation with CMPDIL based on

the action programme of Project Report

preparation along with the various

environmental monitoring works.

35.1.2 Environmental Impact Assessment

(EIA)/Environmental Management

Plans (EMPs) for new Projects/

Existing Projects - Status of

Environmental Clearance.

During the year 2010-11, a total of 7

(seven) nos. EIA/EMPs prepared as

per Terms of Reference (TOR) and

after completion of Public Hearing were

submitted to Ministry of Environment

& Forests (MOEF), Govt. of India for

obtaining Environmental Clearance.

The company has received

Environmental Clearance for 10(ten)

projects/mines during the year 2010-

11as per EIA Notification, 2006.

35.1.3 Public Hearing

The company has conducted Public

Hearings through State Pollution

Control Board for 2 (two) nos. of

projects during the year 2010-11.

35.1.4 Terms of Reference (TOR)

The company has received Terms of

Reference (TOR) as per EIA

Notification, 2006 for 6 (six) nos. of

projects during the year 2010 - 11 from

Ministry of Environment & Forests,

Govt. of India.

14th to 21st September, 2010 in WCL

HQ, during which, various

programmes/competitions, such as,

self composed poem recitation

competition, extempore speech

competition, general knowledge

including cross word competition and

"Prashna Manch" were organised. 9

winners of these competitions were

felicitated. Besides this, 75 prizes

were provided during "Prashna

Manch". During the concluding

function of Rajbhasha Week, 9

departments of WCL HQ and 2 Areas

of WCL were given away Rajbhasha

Shield/Rajbhasha Cup for doing

outstanding work in Hindi during the year.

34.7 At present, 6738 Hindi Books on

various subjects are available in Dinkar

Hindi Library which are being used by

the employees. 9 Hindi magazines

were also made available during the year.

34.8 Shri Dinesh Chandra Garg, CMD,

WCL and Shri Om Prakash Miglani,

Director(Personnel), WCL were

awarded "Rajbhasha Shree Samman"

and "Rajbhasha Kirti Samman"

respectively by the Bharatiya

Rajbhasha Vikas Sansthan, Dehradun

at a concluding function of All India

Rajbhasha Seminar held at Jabalpur

from 27th to 29th October, 2010 for

doing excellent work in Hindi in WCL.

34.9 Shri Sharad Nasery, Office Supdt.

working in Sales Accounts

Department of WCL HQ has earned a

consolation prize in the Hindi Essay

Competition held on 13.04.2010 under

the aegis of Nagar Official Language

Implementation Committee.

35. ENVIRONMENT AND ECOLOGY:

35.1 Your Company is aware of its

Corporate Social Responsibilities

towards the environment and ecology

aspects of project management and is

47


v) Awareness on environment

through Rallies

36. ACTIVITIES OF VIGILANCE

DIVISION DURING 2010-11

36.1 Preventive Vigilance :

As preventive vigilance eleven surprise

and one CTE type inspection has been

carried out and as its outcome, one

internal circular on preventive

maintenance has been issued on the

initiation of Vigilance Department. The

circular issued suggested improvement

in practice and procedures on method

of issuance of work order in a tender

process.

36.2 Punitive Vigilance :

As punitive vigilance twenty two

investigations were taken up out of

which, seventeen have been

completed. The vigilance activities

have resulted into fifteen Regular

Departmental Actions (RDA). thirteen

inquiries have been completed and three

major penalties and three minor

penalties have been imposed. In

addition five persons have been

cautioned/warned to remain careful in

future. In a vigilance case, on finding

error on the part of the officers

concerned recovery of Rs.336996/- has

been made from the salary of two

officers.

36.3 Other activities like observance of

Vigilance Awareness Fortnight,

preparation of "Agreed List" and "Officer

of Doubtful Integrity" and rotation of

employees to non sensitive posts have

been carried out. Close liaison with

Central Bureau of Investigation and

Central Vigilance Commission has

been maintained. In addition, 15187

number of vigilance clearance to

Executives and Non-executives were

issued.

35.3 Other Environmental Mitigation

Measures completed in 2010-11

Following pollution control measures

have been completed during the year

2010-11.

1) Land Reclamation monitoring

through Remote Sensing

Technique - 10 major OCPs,

producing more than 5 million cubic

meter (Coal + OB), are being

monitored by CMPDIL every year.

2) Installation of Mechanical Oil-

Skimmer in Workshop Effluent

Treatment Plant at Gondegaon

OCP of Nagpur Area and

Padmapur OCP of Chandrapur Area.

3) Installation and commissioning of

Sedimentation Tanks at Niljai

OCP,Padmapur OCP(Sector - IV)

AND Durgapur Raiyatwari UG.

4) Workshop Effluent Treatment Plant

at Kamptee OCP has been made

operational.

35.4 Environmental Awareness

Environment Week (June 1 - 7, 2010)

and World Environment Day on 5th

June, 2010 were observed in your

Company at HQ, Area Levels and

Project Levels.

A brief of activities undertaken during

the week - long celebration were as follows:-

i) Pledge on Environment Protection

as per "UN- Slogan" taken by all

employees both at Corporate (HQ)

and at all Areas.

ii) Organizing various competitions

among wards of employees viz.

Drawing, Slogan, Prasna

Manch(Quiz on Environment) etc.

iii) Organising talk on Environment by

Outside Experts

iv) Plantation & distribution of plants

48


organization. It is a self-imposed

discipline which guides themanagement and employees tofunction towards the goal of theorganization. It involves essentially acreative, generative and positivethinking activity that adds value to thestakeholders.

38.1.2 In your Company, CorporateGovernance philosophy stems fromour belief that Corporate Governanceis a key element in improving efficiencyand growth as well as enhancingoutsiders confidence. We are makingcontinuous efforts to adopt the bestpractice in Corporate Governance andwe believe that the practice we areputting into place for the company shallgo beyond adherence to regulatoryframework.

38.2 Board of Directors :

38.2.1 Size of the Board :

In terms of Articles of Association ofthe Company, strength of our Boardshall not be less than three Directorsand more than fifteen Directors. TheseDirectors may be either whole timeFunctional Director or Part-timeDirectors.

38.2.2 Composition of the Board :

As on 31st March, 2011, the Boardcomprised twelve Directors, out ofwhich five are whole time FunctionalDirectors including the Chairman-cum-Managing Director. Two Directors arenominees of the Government of India.The Board also has five IndependentDirectors who have been appointed bythe Govt. of India through a SearchCommittee constituted for the purpose.In addition to this, Government hasnominated two representatives eachfrom Govt. of Madhya Pradesh andCentral Railway as Permanent Inviteeson the Board of WCL. The Directorsbring to the Board wide range of

experience and skill.

37. DIRECTORS :

37.1 The following persons continued to bethe Directors of your Company duringthe year under report :

1. Shri D.C. Garg,


2. Shri R. Mohan Das,Director

3. Shri O.P. Miglani,

Director (Personnel)

4. Shri B.K. Saxena,

Director (Tech.) OP

5. Shri Om Prakash,

Director (Tech.) P&P

6. Shir Sushil Behl,

Director (Finance)

37.2 Following persons were appointed asDirectors of your Company during theyear under report :

1. Dr. Ahindra Chakrabarti w.e.f. 27.04.2010

2. Shri A.K. Bhalla w.e.f. 06.07.2010

3. Ms. Lalitha Kumar w.e.f. 24.02.2011

4. Shri Vinod Somani w.e.f. 24.02.2011

5. Shri Arun Balakrishnan w.e.f. 24.02.2011

6. Dr. D. Chandrashekharam w.e.f. 24.02.2011

37.3 Following persons ceased to beDirectors of your Company during theyear under report :

1. Shri K.S. Kropha w.e.f. 19.04.2010

2. Shri M.N. Buch w.e.f. 24.08.2010

3. Shri A.B. Dutt w.e.f. 24.08.2010

4. Shri S.K. Varma w.e.f. 29.08.2010

37.4 After 31st March, 2011 Shri O.P. Miglaniceased to be Director of yourCompany w.e.f. 02.05.2011.

38. Corporate Governance in WCL :

38.1 Company's Philosophy :

38.1.1 Corporate Governance is acommitment backed by transparencyin functioning, value and mutual trustamong all the constituents of an

49


38.4 Information placed before the Board

of Directors :

Board has complete access to any

information within the Company. The

information regularly supplied to Board

includes :-

- Annual operating plans and

budgets and any update.

- Capital budget and any update.

- Quarterly result of the

Company.

- Annual Report, Directors'

Report etc.

- Minutes of the meeting of Audit

Committee.

- Fatal or serious accidents,

dangerous occurrence etc.

- Operational highlights.

- Award of large contracts.

- Major investment, joint venture etc.

- Disclosure of interest by

Directors about Directorship

and Position occupied by them

in other companies.

- Non-compliance of any

regulatory, statutory requirement.

- Utilization of equipment.

- Other materially important

information.

38.5 Audit Committee :

38.5.1 The scope, constitution etc. of the Audit

Committee is in line with the guidelines

of Corporate Governance.

38.5.1.1 Scope of Audit Committee :

a) Ensure compliance of internal

control system.

b) Reviewing, with the management,

38.3 Board Meeting :

The meeting of the Board of Directors

are normally held at the Company's

registered office at Nagpur. The

Company has defined procedure for

meeting of the Board of Directors and

Committees thereof so as to facilitate

decision making in an informed and

efficient manner. Seven Board

meetings were held during the financial

year 2010-11 on 06.04.2010,

29.04.2010, 18.07.2010, 20.08.2010,

22.10.2010, 07.01.2011 and

08.02.2011 respectively. Details of

number of Board meetings attended by

Directors are tabulated below :-

Sl. Directors Meetings No. of Number ofNo. held during Board Committee

respective Meetings membership tenure of attended in theCompany

Directors in 2010-11As As

Chairman Member

Functional Directors :

1. Shri D.C. Garg,Chairman-cum-Mg. Director 7 7 - -

2. Shri O.P. Miglani,Director (Personnel) 7 7 1 -

3. Shri B.K. Saxena,Director (Tech.) Operations 7 7 - 3

4. Shri Om Prakash,Director (Tech.) Planning & Projects 7 7 1 1

5 Shri Sushil Behl,Director (Finance) 7 7 - 2

Government Directors : 6. Shri K.S. Kropha,

Joint Secretary to the Govt. of India,Ministry of Coal. 1 1 - 1

7. Shri A.K. Bhalla, Jt. Secretary,Ministry of Coal. 5 4 - 1

8. Shri R. Mohan Das,Director (P&IR),

Coal India Limited. 7 7 - -

Independent Directors :

9. Shri M.N. Buch,Ex-Member, PESB 4 4 2 -

10. Shri A.B. Dutt,Ex-Dy.DG, GSI 4 4 - 2

11. Shri S.K. Varma,Ex-CMD, CCL 4 4 - 2

12. Dr. Ahindra Chakrabarti,Professor, IMI, N. Delhi. 5 5 - -

13. Ms. Lalitha Kumar,Former IAS Officer - - - -

14. Shri Vinod Somani,Chartered Accountant. - - - -

15. Shri Arun Balakrishnan,Former CMD, HPCL. - - - -

16. Dr. D. Chandrasekharam,Professor, IIT, Mumbai. - - - -

50


38.5.1.4 Meeting and Attendance :

Due to retirement of 3 Independent

Directors after completion of their term

(three years), only two meetings of the

Committee were held during the year

2010-11. The details of Audit

Committee meetings attended by

members are as under :-

38.6 Remuneration Committee /

Remuneration of Directors :

38.6.1 Your Company, being a Central Public

Sector Undertaking, the appointment,

tenure and remuneration of Directors

are decided by the President of India.

Hence, the Board does not decide

remuneration of the Directors.

Independent Directors are paid only

sitting fees at the rate fixed by the

Board within the ceiling fixed under the

Companies Act, 1956 for attending the

Board Meetings as well as Committee

Meetings. Details of remuneration of

Functional Directors of the Company

are as under :-

(Figs. in Rs )

* Includes PF and Medical reimbursement.

38.6.2 Details of payment made towards

sitting fees to Non-official Directors

during the year 2010-11 are given below :-

the financial statements beforesubmission to the Board forapproval.

c) Reviewing the adequacy of internalaudit function.

d) Discussions with internal auditorsany significant findings and followup thereon.

e) Discussions with StatutoryAuditors.

38.5.1.2 Constitution :

The Audit Committee has beenconstituted with the membership of -

i) Three Independent Directors, onebeing the Chairman of the AuditCommittee and

ii) Joint Secretary, Ministry of Coal,Govt. of India, nominated on theBoard of WCL.

38.5.1.3 Composition :

During the year, Audit Committee of theCompany comprised of four non-executive Directors, three of whichwere Independent Directors and oneGovt. Director.

During the year, the Audit Committeecomprised the following :-

Shri M. N. Buch, Non-official Director(Upto 23.08.2010) - Chairman

Shri K. S. Kropha, Govt. Director(Upto 18.04.2010) - Member

Shri A. K. Bhalla, Govt. Director(w.e.f. 06.07.2010)- Member

Shri A. B. Dutt, Non-official Director(Upto 23.08.2010) - Member

Shri S. K. Varma, Non-official Director(Upto 28.08.2010) - Member

Director (Finance) and Director(Technical) Operations also attendedthe meetings of the Audit Committeeas invitees.

Name Designation 2010-11 Total

Salary Perquisites*

Shri D.C. Garg CMD 18,52,130 1,77,089 20,29,219

Shri O.P. Miglani Director (Pers.) 14,81,742 1,39,061 16,20,803

Shri B.K. Saxena Director (T) OP 16,66,417 1,72,881 18,39,298

Shri Om Prakash Director (T) P&P 16,83,759 1,83,702 18,67,461

Shri Sushil Behl Director (Fin.) 15,83,189 1,54,445 17,37,634

Total 82,67,237 8,27,178 90,94,415

Member of Audit Committee Meetings held

during his tenure Meetings attended

Shri M.N. Buch 2 2

Shri K.S. Kropha 1 1

Shri A.K. Bhalla 1 1

Shri A.B. Dutt 2 2

Shri S.K. Varma 2 2

51


38.10 Whistle Blower Policy :

Your Company has an independent

Vigilance Branch, headed by a Chief

Vigilance Officer. The Vigilance

Branch, functioning under the overall

guidance of Central Vigilance

Commission, mainly lay stresses on

preventive vigilance. Drop Box has

been kept, where employees and

others can report to the Vigilance

Branch, concerns about unethical

behaviour, actual or suspected fraud

etc. and the complaints so lodged are

reviewed by the Vigilance Branch and

necessary action, as deemed fit, is

taken, while protecting the identity of

the complainants.

E-tendering for procurement of

materials has also been introduced in

your Company.

39. AUDITORS :

In exercise of the powers conferred by

the Company at the Extra-ordinary

General Meeting held on 30th August,

2001, pursuant to provisions of section

224(8) of the Companies Act, 1956, the

Board of Directors in its 226th meeting

held on 20th August , 2010, fixed the

remuneration of Statutory and Branch

Auditors appointed by the Comptroller

and Auditor General of India, under

section 619(2) of the Companies Act,

1956 for the financial year 2010-11. In

addition to the annual audit, the Board

of Directors appointed auditors for

carrying out review of 1st Quarter

Accounts ended on 30.06.2010, half

yearly accounts ended on 30.09.2010

& 3rd Quarter Accounts ended on

31.12.2010 and fixed the remuneration

at its 225th meeting held on 18th May

, 2010 , 226th meeting held on 20th

August , 2010 and 228th meeting held

38.7 General Body Meetings / Annual

General Meetings :

Date, time and locations where the last

three Annual General Meetings were

held are as under:-

38.8 Disclosure :

As per the disclosure given by the

Directors of the Company, there were

no material related party transactions

that have potential conflicts with the

interest of the Company. The financial

statements are prepared in

accordance with applicable mandatory

Accounting Standards and relevant

presentational requirement of the

Companies Act, 1956.

38.9 Audit Qualifications :

It is always the Company's endeavour

to present unqualified financial

statement. Management reply to the

Statutory Auditors' observations on

the Accounts of the Company for the

year ended March, 2011 are furnished

as an Annexure to the Directors'

Report. Comments of the Comptroller

and Auditor General of India under

Sec. 619(4) of the Companies Act,

1956 on the Accounts of Western

Coalfields Limited for the year ended

31st March, 2011 is also enclosed.

Sl.

No.

Total

amount

Name of the Part-

time Non-officialDirectors

Sitting Fees paid for

attending

Committee

Meeting

Board

Meeting

1. Shri M.N. Buch Rs. 40,000/- Rs. 15,000/- Rs. 55,000/-

2. Shri A.B. Dutt Rs.40,000/- Rs. 15,000/- Rs. 55,000/-

3. Shri S.K. Varma Rs.40,000/- Rs. 15,000/- Rs. 55,000/-

4. Dr. Ahindra Chakrabarti Rs.55,000/- - Rs. 55,000/-

Date : July 26, 2008 July 24, 2009 May 15, 2010

Time : 10.30 A.M. 4.30 P.M. 1.30 P.M.Venue : Coal Estate, Coal Estate, Coal Estate,

Civil Lines, Civil Lines, Civil Lines,Nagpur. Nagpur. Nagpur

SpecialResolut-

ions :

To amend Articles of Associationregarding enhancement of Del-

egation of Powers without theapproval of Govt.

52


on 7th January , 2011 respectively .

The details of Auditors , their fees and

other expenses approved is as under :-

40. FIXED DEPOSITS :

Your Company has not accepted any

fixed deposits from public during the

year 2010-11, as defined under section

58-A of the Companies Act, 1956 and

the rules made thereunder.

41. DIRECTORS' RESPONSIBILITY

STATEMENT :

Pursuant to the requirement under

section 217(2AA) of the Companies

Act, 1956, with respect to Directors'

Responsibility Statement, it is hereby

confirmed :

i) That in the preparation of the Annual

Accounts for the financial year

ended 31st March, 2011, the

applicable Accounting Standards

have been followed along with

proper explanations relating to

material departures;

ii) That the Directors have selected

such Accounting Policies and

applied them consistently and made

judgements and estimates that were

reasonable and prudent so as to

give a true and fair view of the state

of affairs of the Company at the end

of the financial year and of the profit

or loss of the Company for the year

under review;

iii) That the Directors have taken proper

and sufficient care for the

maintenance of adequate

accounting records in accordance

with the provisions of the

Companies Act, 1956 for

safeguarding the assets of the

Company and for preventing and

detecting fraud and other

irregularities;

iv) That the Directors have prepared the

accounts for the financial year

ended 31st March, 2011 on a 'Going

Concern' basis.

The accounts of your company would

be available at the Headquarter of the

Company for providing information to

the shareholders of the CIL on demand,

if any.

42. ACKNOWLEDGEMENTS :

42.1 Your Directors express their gratitude

to the Ministry of Coal, Government of

India and Coal India Limited, for their

valuable assistance, support and

guidance from time to time.

Statutory/Branch Audit Fee TA/DA and out-of-Auditors pocket expenses

A Statutory Auditors :M/s Shah Baheti Rs. 1,05,156/-for 1st

Chandak & Co quarter a/cs plus S.Chartered Accountants , Tax as applicable ..

Nagpur.

M/s. C . R . Sagdeo& Co., Chartered

Accountants ,Nagpur.

B Branch Auditors :M/s. C . R . Sagdeo

& Co.,CharteredAccountants , Nagpur.

M/s. V.K.Surana& Co., Chartered

Accountants, Nagpur.

M/s. Jodh Joshi & Co.,

Chartered Accountants,Nagpur.

M/s. A . S . Dani & Co.,

Chartered Accountants ,Nagpur.

M/s. Chandak,Khanzode and Shenwai,

Chartered Accountants ,Nagpur.

Total :

At actuals , subject tomaximum of actual

fare plus DA for Part-ners / qualified assis-

tants @ Rs.140/- perday and for audit as-

sistants @ Rs.120/-per day for the actual

mandays engagedfor audit of Areas/ of-

fices situated outsideNagpur city.

Rs.4,20,625/- forannual a/cs and @

Rs.105150/- each forhalf yearly a/cs and

3rd Quarter a/cs plusS.Tax as applicable .

Rs. 56,250/- for 1st

quarter a/cs plus S.Taxas applicable .

Rs. 56,250/- for 1st

quarter a/cs plus

S.Tax as applicable

Rs.2,25,000/- forannual a/cs and @

Rs.56,250/- each forhalf yearly a/cs and 3rd

quarter a/cs plus S.Taxas applicable

Rs.2,25,000/- for annual a/

cs and @Rs.56,250/- eachfor half yearly a/cs and 3rd

quarter a/cs plus S.Tax asapplicable .

Rs.1,75,000/- for annual

a/cs and @Rs.43,750/-each for 1st quarter , half

yearly and 3rd quarter a/csplus S.Tax as applicable .

Rs.10,45,625/- for annual

a/cs and Rs. 2,61,406/- for1st quarter , Rs.2,61,400/-

for half yearly and Rs.2,61,400/- for 3rd quarter

a/cs plus S.Tax as appli-cable.

53


42.2 The Directors thank various Ministries

of the Central Government and the

State Governments of Maharashtra

and Madhya Pradesh for their valuable

support.

42.3 The Directors also take this opportunity

to acknowledge with thanks the

assistance rendered by the sister

organisations and Directorate General

of Mines Safety.

42.4 Industrial Relations in the Company

continued to be cordial. The Directors

place on record their appreciation for

the co-operation extended by the Trade

Unions and Officers Association and

all Steering Committee Members,

Officers of Ministry of Labour and the

team spirit shown by the employees

at all levels towards the achievement

of the objectives of the Company.

42.5 The Directors record the appreciation

of services rendered by Statutory and

Branch Auditors and the Officers and

Staff of Comptroller & Auditor General

of India, Department of Company

Affairs, Company Law Board and

Registrar of Companies, Maharashtra.

42.6 The Directors also extend their thanks

to various important citizens of

Nagpur, Maharashtra and Madhya

Pradesh States, stationed in the

Coalfields for their co-operation from

time to time and also to the Steering

Committee of WCL comprising of

Trade Union representatives and

Management.

43. ADDENDA :

43.1 The following papers are annexed :

43.2 In pursuance to the provisions of

section 217(1)(e) of the Companies

Act, 1956, read with Companies

(Disclosure of Particulars in the Report

of Board of Directors) Rules, 1988,

information in regard to the

Conservation of Energy, Technology

Absorption and Foreign Exchange

Earning & Outgo is given in Annexure-

I to this report.

43.3 A statement showing names and other

particulars of those employees of the

Company who were in receipt of

remuneration of not less than

Rs.60,00,000/- during the financial year

2010-11 or Rs.5,00,000/- per month in

compliance of the provisions of section

217 (2-A) of the Companies Act, 1956

and Companies (Particulars of

Employees) Rules, 1975 is furnished

in Annexure-II to this report.

43.4 Corpoate Governance Certificate, in

compliance of conditions of Corporate

Governance, from Practising

Company Secretary.

43.5 Addendum to the Directors' Report

under section 217 (3) of the Companies

Act, 1956.

43.6 Comments of the Comptroller & Auditor

General (C&AG) of India under section

619 (4) of the Companies Act, 1956.

For and on behalf of Board of Directors

Sd/-

( D.C. Garg )

CHAIRMAN-CUM-MANAGING DIRECTOR

NAGPUR

DATED : 27th May, 2011

54


ANNEXURE-I TO DIRECTORS’ REPORT

Information in accordance with the provisions of section 217(1)(e) of the Companies

Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of

Directors) Rules, 1988 regarding Conservation of Energy. Technology Absorption and

Foreign Exchange Earning & Outgo.

A. Conservation of Energy :

Your esteemed organisation was conferred with National Energy Conservation Award 2010 in

the the field of Energy Conservation achieved during 2009-10. However, there was adverse

impact in 2010-11 in the field of Energy Conservation due to almost twice the rainfall during

monsoon 2010 against that in 2009. Many high head pumps were pushed to dewater the

drowned working places in almost all the opencast mines of WCL resulting in high energy

consumption and less coal production.

(a) In spite of the above lot many measures were taken for Energy Conservation, which

are given as under :-

1. ADDITION OF CAPACITORS TO IMPROVE AND MAINTAIN THE

POWER FACTOR ABOVE 0.95.

2. STAGGERING OF PUMPING OPERATIONS

3. ELIMINATING STAGE PUMPING/RE-ORGANISATION OF PUMPING.

4. USE OF ENERGY EFFICIENT TUBES/ CFL IN PLACE OF HIGH WATT

LUMINAIRES/CONVENTIONAL FITTINGS.

5. USE OF ENERGY SAVER IN STREET LIGHT CIRCUIT

6. INSTALLED DEMAND CONTROLLERS IN MAIN CONTROLLING

SWITCHES TO KEEP THE DEMAND WITHIN LIMIT.

7. REPLACEMENT OF OVER RATED MOTORS

8. LOAD SHEDDING ON DOMESTIC FEEDERS

9. REDUCE THE IDLE RUNNING OF CHP

10. INSTALLATION OF UG BUNKER

11. ADOPTION OF FRP BLADE IN PLACE OF METALLIC BLADE OF PV-200

VENTILATION FAN.

(b) Additional investments and proposals if any being implemented fo reduction of

consumption of energy for electrical energy :

55


An amount of Rs 10.46 lakhs was invested towards the purchase of capacitors

for improving and maintaining power factor.

However, Specific Energy Conservation has increased adversely due to the rea

son mentioned above and in spite of action taken at (a) and (b), which is re

flected as under .

B. Form ‘B’ is enclosed.

C. Foreign Exchange Earning & Outgo :

(i) Activities relating to exports , initiatives taken to increase exports , develop-

ment of new export markets for products and services and export plans :

Company is not engaged in export activities .

(ii) Total Foreign Exchange used and earned :

( Rs. in lakhs )

Particulars Current year

Previous year

(A) Foreign Exchange earned : 0.00 0.00

(B) Foreign Exchange used : i) C.I.F Value of Imports

a) Raw materials 0.00 0.00 b) Components , Stores & Spare Parts 311.76 280.53 c) Capital Goods 0.00 0.00

ii) Repayment of JEXIM Loan 797.45 724.74 iii) Repayment of IBRD Loan 520.74 523.89

iv) Effect of Exchange fluctuation 623.00 -1159.73 v) Travelling Expenses 2.11 4.16 vi) Interest/Commitment/Agency charges etc.

of IBRD/JEXIM (including swap cost) 329.47 383.28

0.00 0.00

Particulars 2010-11 2009-10 % increase/

decrease

Impact on cost of

production

Consumption of energy per ton of coal production KWH/TON KWH/CUM (Coal+O.B)

15.11

4.58

13.15

3.66

14.9 (Increase)

25.1 (Increase)

However, power cost per ton increased from Rs. 69.44 to Rs. 82.66 due to the upward revision in tariff by power supply agencies of M.P. and Maharashtra and increased pumping due to more rain fall compare to previous year. Avg. Rain fall in 2009-10 – 1339.96 mm and 2010-11 –

2131.90 mm

56


Form ‘B’

Disclosure of Particulars with respect to Technology Absorption:

A. R & D activities

Research and Development and Technical studies on Method of workings, support

design, hydro-geological Survey with respect to U/G mine and Stability of workings,

Controlled Blasting, etc. for O/C mines are being carried out on regular basis as per

difficulty being faced during working in various mines of WCL, through different Scientific

and Research Organisations like:-

1. Central Institute of Mining & Fuel Research (CIMFR)

2. Central Mine Planning & Design Institute Limited(CMPDIL)

3. National Institute of Rock Mechanics(NIRM)

4. Rock Mechanics Technology Ltd.

R&D Projects taken up during 2010-11 :

1. Study for Roof Behavior At DRC-6, 7 & 8 by NIRM

2. Study for adopting suitable method for liquidation of standing pillars without disturbing

surface at Saoner-2 by NIRM.

3. Study of High wall slope/Bench stability at western pit of Umrer OC by CIMFR

4. Study of stabilization of U/G workings of Majri seam beneath & within 45m of railway

acquired land of Majri-Rajur railway line of Central Railway in between railway station

at Majri & Majri Khadan, at NMC-3 by CIMFR

5. Approval for engagement of CIMFR,scientific assistant &advise in dealing the fire

at NMC-3 mine.

6. Ventilation investigation for improvement in ventilation as well as reduction in pos

sibility of occurrence of spontaneous heating and ventilation planning at

Kumbharkhani mine by CIMFR.

7. Conducting ventilation investigation for improvement in ventilation as well as re

duction in possibility of occurrence of spontaneous heating & ventilation planning at

Silewara by CIMFR.

8. Suitability study on utilisation of fly/pond ash from Thermal Power Plants for stow

ing in UG mines of Chandrapur & Nagpur Areas by CIMFR.

57


B. Technology Absorption, Adaptation and Innovation :

Efforts, in brief, made towards technology absorption, adaptation and innovation:

Concerted efforts are being made for technology absorption, adaptation and innovation

and various scientific studies in the sphere of mining with due emphasis on safety,

environment control, conservation and quality improvement, details of which are

furnished below:

Underground Coal Gassification

Your company has identified a block, Thesgora “C” to study the feasibility of introduction

of Underground Coal Gassification, one of the two projects undertaken by CIL for which

CMPDIL is carrying out bidding.

CMPDI, HQ, the nodal company for UCG projects has prepared tender documents

with regards to Thesgora”C” block & floated tender which was opened on 16.03.2011.

06 Nos of bidders have submitted their tender and the same is under evaluation at

CMPDIL,HQ.

C. Mining Technology :

1. CONTINUOUS MINER TECHNOLOGY

Continuous Miner technology is under operation at two UG mines of WCL :

1. Tandsi 1 & 2

2. Kumbharkhani Mine

Two operating mines namely Maori & Saoner-I mines have been identified for further

introduction of the technology.

The tenders were floated for Continuous Cutting Technology at Saoner-I and Maori.

The same were opened on 04.01.2011 & 08.01.2011 respectively. 03 Nos. of bidders

participated in the aforesaid tender, whose offers are being evaluated for finalising the same.

2. LONGWALL MINING/ MASS PRODUCTION TECHNOLOGY

Three Coal Blocks namely Nand (1 MTY), Murpar Expansion (2 MTY) & Borda Block

(2MTY) have been identified for Development as High capacity Underground Mines.

Global bid document for re-tendering is under modification at CMPDIL, RI-IV as

recommended by a committee appointed for the same on the lines of BCCL documents.

3. Application of Man Riding System in UG Mines

Man Riding System is already working in Tandsi 1& 2 Mine and Maori mines of Kanhan

Area, WCL, where the workings are very deep and far from the surface.

The system reduces traveling time and fatigue of workers, who work with increased

efficiency & renewed vigour.

Further, WCL board has accorded its approval for introduction of Man riding system in

following UG mines IN First Stage

58


1. Tawa - Chairlift Manriding system

2. Sarni - Chairlift Manriding system

3. Sobhapur - Chairlift & Rail Car Manriding system

4. Kumbharkhani - Rail Car Manriding system

5. Saoner-1 - Chairlift Manriding system

The consignment for Man riding system has been received by all the Areas and are

under installation.

Trial run for chair lift man riding system at Saoner-I is being done and the same shall be

brought to service within short time after DGMS approval.

Further tender has been finalised & order placed for introduction of Chairlift system of

Man-riding in Ballarpur 3&4.

Introduction of Man-riding system in Saoner-II has been approved by WCL Board.

Tendering action is under way.

4. Universal Drilling Machines (UDM)

Your Company has made leading role to mechanize face drilling as well as drilling for

roof support. In this regard 19 Nos. UDMs (purchased from manufacturers) have been

put in operation. Further 11 Nos. UDMs are expected to be supplied in First Quarter of 2011-12.

After introduction of UDM at Tawa-II & Sarni U/G mine of Pathakhera Area, there is

significant increase in blasting efficiency of the mine, thereby increasing Coal availability.

Apart from the aforesaid benefits there is significant improvement in green zone

support with added Safety.

5. Non-Coking Coal washery

A 5 MTY capacity Non- Coking Coal Washery is being planned to be set up in WCL at

Kolarpimpri O/C of Wani north area to provide washed coal to power utility.

Particulars Earlier Performance Performance after introduction of UDM

Av.Pull/Blast 0.8 - 0.9m 1.1m

Yield 12 Tonnes 18 Tonnes

Powder Factor 1.9 -1.93 2

Detonator Factor 0.8 - 0.9 1.0 - 1.1

59


The RFP bid documents is under finalisation at CMPDIL (HQ), Ranchi. A piece of 27

Hect. Land has been identified in Kolarpimpri Deep Extension Block of Wani north Area

as a probable site to this washery. The soil testing report has been submitted to

CMPDIL,Ranchi. Conceptual report prepared by CMPDI, Ranchi has been presented

and deliberated by TSC to WCL Board on 22.12.2010 and the same is under finalisation

for its acceptance which will be put up to WCL Board for its approval. However, the

action is being taken by CIL for Common Centralised Request For Qualification (CCRFQ)

by floating tender for remaining eleven (11) Washeries of all the subsidiaries including

this Washery and short-listing of bidders has been done.

60


ANNEXURE-II TO DIRECTORS’ REPORT

STATEMENT SHOWING PARTICULARS OF EMPLOYEES UNDER SECTION

217(2A) OF THE COMPANIES ACT , 1956 AS AMENDED AND READ WITH THE

COMPANIES (PARTICULARS OF EMPLOYEES) RULES , 1975 , FORMING PART

OF THE DIRECTOR’S REPORT FOR THE YEAR ENDING ON 31 ST MARCH , 2011 .

(A) Employed for the whole of the Financial Year and in receipt of Remuneration

aggregating to not less than Rs.60.00 lakhs P.A.

Sl.no. Names Designation Qualification Experience Date of Comm. Age Previous

in Years Employment Employment

NIL

(B) Employed for part of the Financial Year and in respect of Remuneration

aggregating to not less than Rs.5.00 lakhs P.M.

SL.

N O

NAM E D ESIG -N ATION R EMUN E-RATION

QUALIFI-CATION

C O MM EN CEM ENT OF EM PLO Y-M ENT

EXPE-R IEN CE

IN YEARS

AGE D ATE O F SEPARA- T ION

RE MARK

1 BARID BARAN RAY SR .SYSTEM

OF FICER 1512588 GRADU ATE 03 /02 /1978 32 60 30 /06 /2010 Re tired

2 DR .MRS N IRMALA CH OUKSE

EX—CM O 2073895 M BBS;M.D 06 /10 /1979 31 60 31 /07 /2010 Re tired

3 AKBARALI NATH UM IYA

T UB LOADER 915354 L ITERATE 25 /12 /1972 38 60 30 /04 /2010 Re tired

4 PHERI RAM EXE. EN G 1748771 L ITERATE 31 /01 /1980 30 60 30 /06 /2010 Re tired

5 SANT YADOO M /SAR DAR 760301 L ITERATE 08 /04 /1975 35 60 30 /04 /2010 Re tired

6 B .R. BHALERAO SR .STAFF

N URSE 1908900 L ITERATE 18 /12 /1979 31 60 31 /05 /2010 Re tired

7 BHANU DAS W .SU RPAM

D UM PER OPERT.

546169 V II TH PASSED

19 /12 /1982 28 60 30 /04 /2010 Re tired

8 NAM DEO TAN BA L INE MISTR Y 584479 M AD HYAMIK 27 /04 /1950 29 60 30 /04 /2010 Re tired

9 RAM ASH AN KAR SR .SAFTY PR O

AS 1156195 UPTO CLASS

V III 04 /05 /1950 35 60 31 /05 /2010 Re tired

10 SANGAM KISTAIYA SR .SAFTY PR O

AS 909514 M AD HYAMIK 03 /04 /1950 32 60 30 /04 /2010 Re tired

11 M AN IK G.NIMKAR T /MISTRY 681160 NON -

M AT RICULATE

01 /03 /1975 35 60 30 /04 /2010 Re tired

12 NARAYAN BHOYAR S .C.P .ASSISTA

N T 913172 M AT RICULAT

E 13 /04 /1975 35 60 30 /04 /2010 Re tired

13 NAND RAM DU RYODHAN

L INE MISTR Y 519222 NON -M AT RICULATE

17 /01 /1982 28 60 30 /04 /2010 Re tired

14 N.P .PAT HAK SR . M AN AGER

(PER ) 4113890 POST

GRADU ATE 02 /08 /1950 34 60 30 /08 /2010 Re tired

15 M OON D.S D Y. G .M (CIV IL ) 1326534 BA DIP IN

SUR VEY 09 /01 /1974 36 60 30 /04 /2010 Re tired

16 DR . S .K . M ISH RA C HIEF

M EDICAL OF FICER

1616424 M .B .B .S 05 /01 /1980 30 60 30 /06 /2010 Re tired

17 ANAND PRASAD

S ING H

SR .M ANAGER

(EXV.)

1345674 B .E (ELECT) 11 /07 /1992 18 43 14 /05 /2010 Death

61


SL.NO

NAME DESIG-NATION REMUNE-RATION

QUALIFI-CATION

COMMENCEMENT OF

EMPLOY-MENT

EXPE-RIENCE

IN YEARS

AGE DATE OF SEPARA-

TION

REMARK

18 R. M.CHATERJEE ENGINEER

(E&T)

1615253 DIPLOMA

(ELECTRICA

L)

30/12/1981 29 60 31/05/2010 Retired

19 R. K. PRASAD C. E. (X) 2047743 DIPLOMA

(MECHANICA

L)

30/03/1978 32 60 30/04/2010 Retired

20 BONTAL RAJANNA OFFICE SUPDT 1022744 SSC PASSED 28/01/1970 40 60 30/04/2010 Retired

21 G.M.ROGE ASSTT

FOREMAN

863781 SSC 01/02/1976 34 60 30/04/2010 Retired

22 R S THAKUR DY CHIEF SALESMGR

2651196 M A 04/08/1975 35 60 05/01/2010 Retired

23 LAXMINARAYAN DY CHIEF FIN MGR

3306261 B.COM. CIL PART II

01/03/1972 38 60 05/01/2010 Retired

24 HARSHVARDHAN DY CE(CE(X) 3015776 M.TECH 27/09/1977 33 60 31/05/2010 Retired

25 D.A KUMARSWAMI S E (CIVIL) 2785201 BE (CIVIL) 13/09/1974 36 60 31/05/2010 Retired

26 A.K.KAPOOR S.E(E&M) 2770567 ENGINEER 25/06/1974 35 60 31/05/2010 Retired

27 S.K.SHARMA DY. MNGR

SALES

2483641 POST

GRADUATE

16/11/1972 37 60 31/05/2010 Retired

28 N.K.SHRIVASTAV S.O(MM) 2823810 POST

GRADUATE

10/04/1972 37 60 31/08/2010 Retired

29 P.K.VERMA GM(F) 3140672 M SC, MBA 28/03/1977 33 60 30/04/2010 Retired

30 M.R.SHANKAR DY F.M. 2537189 CA INTER 14/05/1977 33 60 30/04/2010 Retired

31 S.C.PRASAD SR.ES 2068526 GRADUATE 25/02/1974 36 60 30/04/2010 Retired

32 S.K.JHA GM(EXV) 1974670 BE 10/05/1978 32 60 31/05/2010 Retired

33 C A

VENKATSARALU

DYCE(E&M) 3276683 BE 05/01/1975 35 60 31/05/2010 Retired

34 P.K.RAY DY.CSM 3149005 GRADUATE 28/05/1975 35 60 31/05/2010 Retired

35 G.V.KASHID GM© 2375053 BE 19/04/1976 34 60 31/05/2010 Retired

36 R.M.NAIR DY CE© 2070272 BE 15/06/1981 29 60 31/05/2010 Retired

37 CS.SINGH GM(E&M) 3403328 BE 11/08/1973 37 60 30/06/2010 Retired

38 KC PULLAIAH DY.SM 2298421 GRADUATE 20/05/1969 43 60 30/06/2010 Retired

39 V. SRINIVASAN ES 2348438 GRADUATE 04/01/1974 37 60 31/07/2010 Retired

40 V. RAJAGOPALAN SM(SYS) 2456812 GRADUATE 14/02/1975 35 60 31/07/2010 Retired

41 J. PANDEY SM(RAJ) 2256665 POST GRADUATE

16/03/1975 35 60 31/07/2010 Retired

42 YS DIWAN SM(MIN) 2941449 GRADUATE 03/08/1975 35 60 31/07/2010 Retired

43 PP.CHOUDHURY CM(E&M) 3659432 GRADUATE 24/05/1978 32 60 31/07/2010 Retired

44 SS.KARNAWAT CGM(P) 3924420 BE 20/09/1972 38 60 31/08/2010 Retired

45 K.ANKA RAO GM(SYS) 3861886 BE 10/06/1974 36 60 31/08/2010 Retired

46 S K.SRIVASTAVA GM(WEL) 3950844 POST

GRADUATE

02/04/1975 35 60 31/08/2010 Retired

47 P S.DHINGRA GM(E&M) 3875863 BE 29/07/1966 44 60 31/08/2010 Retired

48 P B.DAMAHE SM© 3417222 BE 12/10/1976 34 60 30/09/2010 Retired

49 A ACHUTTAN OFFICE SUP 949919 GRADUATE 09/10/1973 36 60 30/04/2010 Retired

50 M V UNNIKRISHNAN SR PA 850017 GRADUATE 09/10/1973 36 60 30/04/2010 Retired

51 SMT RANJANA RAUT

SR.DEO 580885 LITERATE 01/12/1982 27 60 30/04/2010 Retired

62


63


ADDENDUM TO DIRECTORS’ REPORT

UNDER SECTION 217(3) AND 227(2) OF THE COMPANIES ACT 1956

AUDIT OBSERVATION

1. We have audited the attached Balance Sheet of WESTERN

COALFIELDS LIMITED as at 31st March 2011, and also the

Profit and Loss Account and Cash Flow Statement for the year

ended on that date annexed thereto. The financial statements

audited by us incorporate the accounts of:-

a) 5 Areas / Units audited by us and

b) 11 Areas / Units audited by Branch Auditors

The reports of Branch Auditors have been furnished to us and

have been appropriately dealt with by us in preparing this

report. Our opinion, in so far as it relates to the amounts included

in financial statements in respect of those Areas, is based solely

on the reports of the Branch Auditors. These financial statements

are the responsibility of the Company’s management. Our

responsibility is to express an opinion on these financial state

ments based on our audit.

2. We conducted our audit in accordance with the Auditing Stan

dards 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.

3. As required by the Companies (Auditors’ Report) Order, 2003

as amended by the Companies (Auditors’ Report) (Amendment)

Order, 2004, issued by the Central Government of India in terms

of sub section (4A) of section 227 the Companies Act, 1956,

we enclose in the Annexure a statement on the matters speci-

fied in paragraphs 4 and 5 of the said order.

4. Further to our comments in the Annexure referred to paragraph

3 above, we report that:-

a) We have obtained all the information and explanations whichto the best of our knowledge and belief were necessary forthe purposes of our audit;

b) In our opinion, except that :

Accrual basis of accounting as required under section 209 (3)(b) of the Companies Act, 1956 has not been followed in respectof the following :

No Comments

No Comments

No Comments

No Comments

No Comments

MANAGEMENT REPLY

64


i) Liquidated damages, interest on delayed payments and

escalation claims from customers are accounted for on the

basis of final settlement.

ii) Insurance / Railway claims are accounted for on admission /

final settlement.

iii) Sale of scrap is accounted on realization.

iv) Refund / adjustment of tax from tax authorities except Input

Tax Credit claim on VAT are accounted for on cash basis.

Additional demand for Income Tax, Royalty, Cess, Sales Tax,

Entry Tax, etc., are accounted for after final orders in appeals

are received. Pending such appeals, payments made against

additional demand are treated as advance / claims receivables.

v) Land under Coal Bearing Area [CBA (A&D)] Act is accounted

for on payment basis,

proper books of account as required by law have been kept

by the Company so far as it appears from our examination of

those books and proper returns adequate for the purpose of

our audit have been received from the Areas not audited by us.

c) The Balance Sheet, Profit & Loss Account and Cash Flow

Statement dealt with by this report are in agreement with the

books of account and with audited returns received from the

Areas.

d) In our opinion, the Balance Sheet, Profit and Loss Account

and Cash Flow Statement comply with the Accounting Standards

referred to in sub-section (3C) of section 211 of the Compa-

nies Act, 1956 to the extent applicable except as mentioned

in para 4 (b) above.

e) The clause (g) of sub-section (1) of section 274 of the Companies

Act, 1956 is not applicable being a Government Company.

f) Without qualifying our opinion, we draw attention to following

notes appearing in Schedule 19 – ‘Notes on Accounts’ :-

i) Note No. 3 (d) regarding some of title deeds / lease deeds for

land, buildings and mining rights still held in the name of Coal

India Limited, pending transfer formalities.

ii) Note no. 3 (f) regarding acquisition of land in Chandrapur Area

and Umrer Area, however ownership of the land not yet vested

with the Areas, therefore, amount paid is kept in advance

account and shown under Capital Commitment and not

transferred to Land Account.

No Comments

No Comments

No Comments

No Comments

No Comments

65


iii) Note No. 3 (h) regarding physical verification of fixed assets

as on 31.03.2003 and subsequent reconciliation done by an

outside agency. However, the inter area adjustment is still

under process.

iv) Note No. 3 (i) regarding Discarded / Surveyed off assets

amounting to Rs.1846.83 lakhs valued at residual 5% not

been physically verified.

v) Note No. 4 (b) regarding depreciation provided on Plant &

Machinery lying in stores for more than 3 years.

vi) Note No. 5 (a) regarding Capital Work in Progress amounting

to Rs.1662.25 lakhs pending since more than 3 years.

vii) Note No. 7 (f) regarding 5% Madhya Pradesh Gramin

Avsanrachna Tatha Sadak Adhiniyam 2005 (MP GATSV Act,

2005) collected from customers and fixed deposits made

against that amount as per Court Order and also treatment

of interest on such fixed deposits.

viii) Note No. 8 (a) regarding advances to suppliers / contractors

& for capital works / mobilization advances lying unadjusted

since long amounting to Rs. 280.83 lakhs.

ix) Note No. 8 (c) regarding non-receipt of confirmations for

sundry debtors, advances to suppliers and contractors, sundry

creditors, advances from customer etc.

x) Note No. 8 (e) regarding employee advances under reconciliation.

xi) Note No. 9 (i) regarding provision made during the current

year for Performance Related Pay for Executives for the year

amounting to Rs. 7395 lakhs.

xii) Note No. 9 (k) regarding recovery of penalty from suppliers

of Explosives on account of non-achievement of benchmark

powder factor.

xiii) Note No. 9 (m) regarding provision made during the year for

Pension and Superannuation benefits to the employees

amounting to Rs.1763.34 lakhs

xiv) Note No. 10 (a) regarding booking of expenses pertaining to

previous years amounting to less than Rs.5 lakhs to current

year expenses.

xv) Note No. 13 (c) regarding non confirmation of balances of

receivables and payables to outsiders.

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

Adjustments are

under progress

No Comments

No Comments

No Comments

As per

accounting policy

No Comments

66


xvi) Note No. 13 (h) regarding excess levy of Surface Transportation

Charges.

xvii) Note No. 13 (i) regarding interest paid under Income Tax Act, 1961.

g) Further we report the following observations :

i) As stated in Note No. 3 (a), 3 (b) and 3 (c) of Schedule – 19

‘Notes on Accounts,’ finalization of purchase consideration of

certain fixed assets is still pending, ‘Assets taken over on

Nationalization’ are not classified into proper sub-head within

fixed assets, fixed assets found in excess on physical verifi-

cation were accounted for at nominal value. These have

impact on reported figures of Gross Block of Fixed Assets,

Accumulated Depreciation and Reserves & Surplus and also

on the presentation of fixed assets. The impact however is

not ascertainable.

ii) As stated in Note No. 3 (c) of Schedule – 19 ‘Notes on

Accounts’ certain Lands acquired are accounted for on

payment basis only. The likely payment for the Lands in future,

if any, are not accounted for until paid (even though the liability

is accrued). This may result in understatement of Fixed As

sets and corresponding liability.

iii) During the year the company has made a change in accounting

policy of making provision for mine closure. This resulted in

additional provision of Rs.10442.41 lakhs for Mine closure

expenditure made on basis of Circular of Ministry of Coal dated

27.08.2009 and which was modified on 18.2.2011 for all

existing mines in operation.

iv) During the year the Company has changed its method of com-

puting, net realizable value (NRV) for valuing closing stock of

coal from notified price to weighted average of notified price

for power and other than power sector consumers. This has

resulted in additional impact on coal stock valuation during the

year of ‘.207.66 lakhs and corresponding increase in profit for

the year.

v) The Company has not adjusted / reconciled stale cheques

amounting of Rs.1841.25 lakhs. However, the impact on the

same on liabilities and profit of the Company is not

ascertainable

h) In our opinion and to the best of our information and according

to the explanations given to us, the accounts subject to para 4

(b) & 4 (g) above read with para 4 (f) above in particular and

other notes appearing in Notes on Accounts and Accounting

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

Reconciliation is

under process

No Comments

67


Policies of the Company forming part of accounts, give the

information required by 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 :

i. In the case of the Balance Sheet, of the state of the affairs

of the Company as at 31st March 2011;

ii. In the case of the Profit & Loss Account, of the profit for

the year ended on that date; and

ii. In the case of Cash Flow Statement, of the cash flows of

the company for the year ended on that date.

FOR C. R. SAGDEO & CO


F.R.N.: 108959 W

DR. CA. JAYANT M. RANADE

PARTNER

Membership No. 017852

Place : NAGPUR

Date : 21st May 2011

No Comments

68


ANNEXURE ‘A’ TO AUDITORS’ REPORT

Referred to in Paragraph (3) of our report of even date in respect of

Western Coalfield Limited , Nagpur

as on 31st March 2011.

AUDIT OBSERVATION

1. In respect of its Fixed Assets:

a) The Company has maintained proper records showing

full particulars including quantitative details and situation of

Fixed Assets, except for assets taken over from Coal

Mines Authority on Nationalisation and those taken from

Coal Mines Rescue Station and Coal Mines Labour Wel

fare Organisation, which have not been recorded. Some

of the title deeds / lease deeds for land building and moving

rights continue to be held in name of Coal India Limited.

b) As explained to us, all the fixed assets as on 31.03.2003,

have been physically verified by firms of Chartered

Accountants / Outside Agencies for all Areas except Head

Quarters, Domestic Fuel Development (DFD), Plant and

Commercial Blast Explosives (CBE) Plant. Their reports

have been received showing items of fixed assets found

short / excess during physical verification. The manage-

ment has appointed an outside agency to carry out

detailed study and reconciliation of the discrepancies pointed

out. At some of the Areas, report is submitted by outside

agency on reconciliation of shortages / excesses of

assets and the same still shows many un-reconciled items.

However, pending reconciliation of items of fixed assets

found short / excess and pending HQ approval, no adjust-

ment has been made in the accounts of the Company for

the year 2010 – 11.

The discarded / surveyed off assets lying in stores which

are valued at 5% residual value and capital Work in Progress

(WIP) have not been physically verified.

In respect of CBE Plant Bhandara, major items of fixed

assets are stated to have been physically verified by the

management of Ordinance Factory, Bhandara at reason

able intervals. No material discrepancy is reported to have

been noticed on such verification.

In respect of DFD Plant, Hinganghat, major items of fixed

assets are stated to have been physically verified by the

committee formed for purpose. No material discrepancy

is reported to have been noticed on such verification.

MANAGEMENT

REPLY

No Comments

Reconciliation is in

progress .

Noted

No Comments

No Comments

69


c) As per information and explanation given to us, all fixed

assets of the value exceeding Rs. One lakh are physically

verified departmentally. Wherever the reports have been

received the reconciliation is in progress and no adjust-

ment has been made in accounts of the Company during

the year.

d) There was no substantial disposal of fixed assets during

the year.

1. In respect of Inventory:

a) The management, at regular intervals, has conducted the

physical verification of coal by adopting volumetric measures.

The physical verification of stock of coal as on 31.03.2011

has been done by a team deputed by Coal India Limited.

Physical verification of stores and spares of the Company

has been conducted by the firm of Chartered Accountants

and / or Cost Accountants appointed for the purpose; except

for the CBE Plant, Bhandara where physical verification

has been done by the management of Ordinance Factory,

as per norms of Ordinance Factory.

In case of DFD Plant Hinganghat, though physical

verification of stocks of inventory was conducted by committee

formed for the purpose. In the absence of list of inventories,

discrepancies if any cannot be commented upon.

However, Physical verification of Units stores and stores in

transit have not been conducted.

b) In our opinion and according to the information and explanation

given to us, the procedures followed by the management

for physical verification of inventories are reasonable and

adequate in relation to the size of the company and nature

of its business. However, procedures of physical verifica-

tion of stores and spares, needs to be strengthened, to

make it reasonable and adequate in relation to the size of

the respective Areas and nature of their business. Also the

procedure for identification of slow/non moving and obso

lete items of inventory requires improvement.

c) The Company is maintaining proper records of inventories.

In accordance with Company’s policy as set out in Para 6

of Accounting Policies (Schedule 17), no adjustment is

Reconciliation is under

process .

No Comments

No Comments

No Comments

Inventory at unit

stores have been

physically verified by

management

No Comments

No Comments

70


made in the books of accounts in case the difference be-tween books stock of coal and volumetrically measuredphysical stock of coal is within (+/-) 5%, due to approximatenature of the method of measurement. As informed to usthe discrepancy noticed on physical verification ascompared to the book records were not material in relation tothe operation of the company and have been duly dealt with.

3. In respect of the loans, secured or unsecured, granted or takenby the Company to/ from companies, firms or other partiescovered in the register maintained under section 301 of the CompaniesAct, 1956

a) The Company had taken unsecured loans under foreigncurrency standing to Rs.10256.38 lakh as on 31.03.2011from IBRD and JEXIM Bank as World Bank Loan throughCoal India Ltd. and guaranteed by the Government of India,for purchase of HEMMs & spares. It is observed that theabove balance of Loan outstanding as on 31st March 2011is after an adjustment of Rs.623.00 lakh net for giving effectof exchange fluctuation in both US $ and Japanese Yen.As followed pursuant to the agreement, steps have beentaken for regular payment of the principal and interest at arate which is not prejudicial to the interest of the Company.The company has not granted any loans to companies,firms or other parties listed in the Register maintained undersection 301 of the Companies Act, 1956.

b) The rate of interest and other terms and conditions of theabove loans taken by the company are prima facie notprejudicial to the interest of the company.

c) The company is regular in repayment of principal amountof above loans and interest thereon.

d) There is no overdue amount in respect of principal amountof loans and interest thereon.

4. In our opinion the Company has adequate Internal Control procedurecommensurate with the size of the Company and the nature ofits business with regard to Purchase of inventory, fixed assetsand with regard to the Sale of goods, except that insurance

cover of most of the fixed assets, and on stock of stores and

spares has not been taken by the company (except for

vehicles). Further in under mentioned cases the internal control

needs to be strengthened :

No Comments

No Comments

No Comments

No Comments

No Comments

71


a) Follow-up of advances to suppliers, adjustment of certain

advances against corresponding liability after receipts of

items in some Areas, transfer of stores to other areas and

its accountal.

b) Non receipt of confirmations of outstanding balances from

customers, suppliers and contractors and timely reconcili-

ation of balances in case of differences.

c) Follow-up and recovery of various advances from employees.

d) Follow-up and adjustment of stale cheques.

5. In respect of transaction covered under section 301 of the Companies Act, 1956.

(a) In our opinion and according to the information and expla-nation given to us, there are no transactions in pursuanceof contract or arrangements entered in the register main-tained under section 301 of the Companies Act, 1956aggregating during the financial year to Rs. 5 lakhs (Rs. FiveLakhs only) or more in respect of any party.

(b) As there is no transaction with parties mentioned in registermaintained under section 301 of the Companies Act, 1956,this clause is not applicable to the Company.

6. The Company has not accepted any deposits from the Public,hence the directives issued by Reserve Bank of India and theprovision of Section 58 A, 58AA or any other relevant provisionof the Companies Act, 1956 and rules made there under arenot applicable for the year under audit.

7. The Internal Audit System of the Company consists of WageAudit, Stores Audit and Internal Audit which were conductedby the independent firms of Chartered Accountants / CostAccountants. Observations in this regard are as under.

a) In few Areas the branch auditors have reported that InternalAudit System needs to be strengthened.

b) The internal audit was being done on calendar year basisand hence was not synchronized with the financial yearfollowed by the Company. But during the year the companyhas changed the period of audit and syncronised it with

Action will be taken forfurther improvement .

Action will be taken forfurther improvement .

Action will be taken forfurther improvement

Action will be taken forfurther improvement

No Comments

No Comments

No Comments

Adequate internalaudit system exist.

No Comments.

72


financial year i.e. 1st April to 31st March, 2011. Further insome of the Areas the internal audit report for the periodfrom July, 2010 to March, 2011 have not been received.

On an overall view, we are of the opinion that the internal audit

system should be further strengthen as to coverage and follow-

up to make it commensurate with the size and nature of its business.

8. Maintenance of Cost records has not been prescribed by theCentral Government under clause (d) of sub-section (1) of section209 of the Companies Act, 1956 in respect of Coal Mining Industry.

9. In respect of Statutory Dues.

(a) According to the records of the Company produced beforeus, the Company is regular in depositing undisputed statutorydues including Provident Fund, Income Tax, Wealth Tax,Sales Tax, Custom Duty, Excise Duty, Cess and otherstatutory dues applicable to the Company with appropriateauthorities except Municipal Tax pertaining to DFD Plant,Hinganghat amounting to Rs. 3.39 Lakhs and Cess on royaltyamounting to Rs.1.52 lakhs pertaining to Majri Area havebeen deposited which were outstanding as at 31.03.2011for a period of more than six months from the date ofbecoming payable.

(b) We enclose in Annexure I, the details of disputed statutorydues such as taxes / cess not deposited due to disputeand the forum where the dispute is pending.

10. The Company neither has accumulated losses and nor it hasincurred any cash losses during the financial year covered byour audit or in the immediately preceding financial year

11. Based on our audit procedures and the information and explanationsgiven by the management, we are of the opinion that the Companyhas not defaulted in repayment of dues to any FinancialInstitutions and Banks.

12. The Company has not granted any Loans and Advances onthe basis of security by way of pledge of shares, debenturesand other securities.

13. The Company is not a chit fund, nidhi or mutual benefit fund /society. Therefore, the provisions of clause 4 (xiii) of the Companies(Auditor’s Report) Order, 2003, are not applicable to the Company.

Adequate internal auditsystem exists.

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

73


14. The Company is not a dealing or trading in shares, debenturesand other investments. Therefore, clause 4 (xiv) of theCompanies (Auditor’s Report) Order, 2003 is not applicable tothe Company.

15. As informed to us Company has not given any guarantee forloans taken by others from Banks or Financial Institutions.

16. In our opinion, and according to the information and explanationsgiven to us, on an overall basis, the term loans have beenapplied for the purposes for which they were obtained.

17. On the basis of an overall examination of the Balance Sheet ofthe Company, in our opinion and according to the informationand explanations given to us, there are no funds raised on ashort-term basis which have been used for long-term investmentor on long term basis which have been used for short terminvestment.

18. During the year, the Company has not made any preferentialallotment of shares to Parties and Companies covered in theRegister maintained under Section 301 of the Companies Act, 1956.

19. According to the information and explanation given to us, theCompany has not created securities by issuing any debenturesduring the period under audit.

20. The Company has not raised any money by public issues duringthe year.

21. In our opinion according to the information and explanationsgiven to us by the Company, no material fraud on or by theCompany has been noticed or reported during the year.

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

No Comments

FOR C. R. SAGDEO & CO.


F.R.N.: 108959 W

DR. CA. JAYANT M. RANADE

PARTNER

Membership No. 017852

Place : NAGPURDate : 21st May 2011

74


Annexure – 1

Statement of disputed statutory dues ( Ref. Para IX B of Annexure ‘ A ’ to our reportdated 21st May, 2011 ) in respect of Western Coalfields Ltd., Nagpur

PENCH AREA

Details of disputed liabilities are given below :-

Name of Statute Nature of dues Amount (Rs.)

Period to which the amount relates

Forum where dispute is pending

MP Entry Tax Act, 1976

Entry Tax 2990390.00 2003-04 A.C.Chhindwara






Entry Tax 1706184.00 2000-01 H.Court, Jabalpur

Central Sales Tax Act, 1956

Central Sales Tax

2400000.00 1998-99 A.C., Chhindwara


Central Sales Tax

431434.00 1997-98 A.C,CTO,Jabalpur


Central Sales Tax

131122.00 1998-99 A.C,CTO,Jabalpur


Central Sales Tax

3197382.00 2003-04 A.C., Chhindwara


Central Sales Tax

4889715.00 2004-05 A.C., Chhindwara

MP Commercial Tax Act, 1994

Commercial Tax 2472828.00 2000-01 H.Court,Jabalpur


Commercial Tax 1754874.00 2003-04 Board Of Rev, Bhopal


Commercial Tax 1614897.00 2002-03 Board Of Rev. Bhopal

Minerals (Validation) Act, 1992

Cess on Royalty & Cess on Storage of Coal

5840276.00 1982-83 SLP, Supreme Court

MPGATSVA, 2005

Gramin Tax on Coal Sales

136817709.00 2005-06 to

2010-11

Rev. Commissioner , Jabalpur

MP Comm Tax Act, 1994

Commercial Tax 156451.00 2007-08 D.C.Chhindwara


Entry Tax 26000.00 2005-06 D.C.Chhindwara


Entry Tax 328000.00 2006-07 D.C.Chhindwara


Central Sales Tax

91000.00 2005-06 D.C., Chhindwara

75

WESTERN COALFIELDS LIMITEDAct, 1956 Tax


Central Sales Tax

374048.00 2006-07 D.C., Chhindwara


Commercial Tax 23000.00 2005-06 D.C., Chhindwara


Commercial Tax 265205.00 2006-07 D.C., Chhindwara


Commercial Tax 477370.00 2006-07 A.C., Chhindwara

C.S.Tax Act-1956 C.S.Tax 673286.00 2006-07 A.C., Chhindwara



Name of Statue Nature of dues Amount

(Rs.)



Mineral Concessions Rules 1960

Cess on Royalty on Coal

3103656.62 More than 5 years

Name of Statute

Nature of Dues

Amount Rs.


Forum where

dispute is

pending

Mineral Concessions Rules , 1960

Cess on Royalty of Coal


Name of Statute

Nature of dues Amount (Rs.)

Period to which the

amount relates


Mineral Concessions Rules 1960

Cess on Royalty on Coal


BALLARPUR AREA

CHANDRAPUR AREA

UMRER AREA

76


Name of Statute Nature of the Dues

Amount (Rs.) Period to which the amount relates


M.P.State Govt. Sales Tax

State Sales Tax 394359.00 2004-05 Appellate board , Bhopal , MP


Central Sales Tax

5391.00 2000-01 For revision With Dy Commissioner


State Sales Tax 1387152.00 2000-01 Appellate board , Bhopal , MP.


Entry Tax 179496.00 2001-02 Appeal Dy. Commissioner

M.P. State Govt. Sales Tax

State Sales Tax 1445793.00 2001-02 Appeal Dy. Commissioner


Entry Tax 1902271.00 2004-05 Appellate board , Bhopal , MP.








VAT 1150704.00 2005-06 Appeal Dy. Commissioner



MAJRI AREA

Name of Statue Nature of dues Amount

(Rs.)



Land Revenue Property tax 4000000.00 2006-07 to 2010-11

Nagarparishad Bhadrawati

Land Revenue Property tax 5789000.00 2010-11 Tahsildar, Bhadrawati

Railway Claims Railway Track Maintenance

5822000.00 2006-07 to 2010-11

Railway Authority

CENTRAL WORKSHOP TADALI

Name of Statute

Nature of dues Amount (Rs.)



Tax on Perks u/s 17(2)

Tax on Perquisites

4488000.00 2004-05 to 2006-07

ITAT

PATHAKHERA AREA

77


N am e o f S ta tute N a tu re of the D ues

A m ount

(R s .)

P eriod to w h ich the am ount re la tes

Forum w here d ispu te is pend ing

M ine rals (V alida tion ) Ac t, 1992

C ess on R oya lty& Cess on S torage o f C oal

3864874 .00 1982 -83 to 1989 -90

SLP pend ing w ith Sup rem e C ourt

M PG A TS VA A ct ,2005

G ram in T ax 310593009 .00 2005 -06 to 2009-10

SLP pend ing w ith Sup rem e C ourt

M P S ta te G ovt.S a les Tax, 2002

S ales Tax 3767844 .00 2007-08 Com m issione r ( Appeals )

M P S ta te G ovt.S a les Tax, 2002

S ales Tax 4889321 .00 2006-07 Com m issione r ( Appeals )

M P Entry Tax Act, 1976

E ntry Tax 101059 .00 2007-08 Com m issione r ( Appeals )

C en tra l Sa les Tax Ac t, 1956

C S T 4584187 .00 2005-06 Appe lla te B oard

C en tra l Sa les Tax Ac t, 1956

C S T 6571045 .00 2007-08 Com m issione r ( Appeals )

Name of Statue

Nature of the dues

Amount

(Rs.)


Forum where the dispute is pending

Mineral Validation Act, 1992

Cess 3850000.00 Supreme Court

BST Act. Sales Tax 19241000.00 S T Tribunal

CST Act. Sales Tax 7700000.00 S T Tribunal

Rent Act Surface Rent 11300000.00 Asst. Comm.

Income Tax Act,1961

TDS on payment to Doctors / Hospitals

1308000.00 CIT ( Appeals ) - II

Income Tax Act,1961

TDS on payment to Doctors / Hospitals

2482000.00 CIT ( Appeals ) - II

Sales Tax Commissioner





Minerals(Validation) Act, 1992

Cess on Storage of Coal

2167295.00 1982-83 to 1989-90

SLP pending with Supreme Court

MPGATSVA, 2005 GraminTax of sale of coal

168219968.00 2005-06 to 2010-11

Supreme Court

M.P. State Govt.Sales Tax


MPGATSVA Sales Tax on Gramin Tax

6728795.00 2005-06 to 2010-11

Supreme Court

M.P. State Govt.Sales Tax

State Sales Tax 7461572.00 2007-08 Gramin Tax

NAGPUR AREA

KANHAN AREA

78


Name of Statute Nature of Dues Amount Rs.

Period to which amount relates


Income Tax Act Corporate Tax 152186000.00 2002-03 High Court , Nagpur



Income Tax Act Corporate Tax 68541000.00 2004-05 ITAT

Income Tax Act Corporate Tax 6002000.00 2005-06 ITAT

Income Tax Act Corporate Tax 145918000.00 2005-06 CIT (Appeal)






Income Tax Act TDS 1358000.00 2007-08 ITAT

Income Tax Act TDS 2582000.00 2008-09 ITAT

Income Tax Act TDS 1308000.00 2009-10 CIT (Appeal)

Income Tax Act TDS 2482000.00 2010-11 CIT (Appeal)

Bombay Sales Tax Act

Sales Tax 2124000.00 2001-02 MSTT , Mumbai

Maharashtra Entry Tax Act

Entry Tax on HEMM

963656000.00 1.4.1988 to31.10.19

96

High Court , Nagpur

Name of Statue Nature of the

dues

Amount

(Rs.)



Land Revenue Surface Rent 90322000.00 1972-73 to

2005-06 District Collector

Chandrapur.

Land Revenue Grampanchayat Tax

1726000.00 2005-06 to

2006-07 District Collector

Yavatmal

Land Revenue Non-Agriculture Assessment Tax

181052000.00

1972-73 to 2003-04

District Collector Chandrapur.

Bombay Sales Tax Act,1959

Entry Tax on Vehicle

59000.00 March-2004 Sales Tax

Tribunal, Nagpur

Cess and other Taxes on Mineral Validation Act.1992

Cess on Royalty 963000.00 March-1994 SP pending

before supreme Court

WANI AREA

HEADQUARTERS

79


80


SCH

I. SOURCES OF FUNDS

1)Shareholders funds

a) Capital A 29,710.00 29,710.00

b) Reserves and Surplus B 450,088.77 479,798.77 402,221.29 431,931.29

2) Loan Funds

Secured - -

Unsecured C 10,256.38 10,256.38 10,951.57 10,951.57

3) Deferred Tax Liabilities 5,915.21 2,047.81

495,970.36 444,930.67

II. APPLICATION OF FUNDS

1) Fixed Assets D

a) Gross Block 429,457.26 413,727.48

Less : Depreciation 276,950.75 265,149.44

Less : Impairment of Assets 10,070.68 9,382.56

Net Block 142,435.83 139,195.48

b) Capital Work In Progress 27,452.77 25,262.54

c) Discarded/Surveyed off Assets 1,731.01 171,619.61 1,609.08 166,067.10

2) Investments E 16,045.00 19,254.00

3) Deferred Tax Assets 40,927.74 34,097.77

4) Current Assets Loans & Advances

a) Interest accrued on Tax free Govt. Bonds 750.11 886.49

b) Inventories F 43,709.09 29,417.12

c) Sundry Debtors G 2,519.88 10,917.90

d) Cash and Bank Balances H 406,377.86 391,996.42

e) Loans and Advances I 228,420.68 176,981.33

681,777.62 610,199.26

Less: Current Liabilities & Provisions J 414,399.61 384,687.46

267,378.01 225,511.80

495,970.36 444,930.67

Accounting Policy 17

Notes providing Statutory Information 18

Notes on Accounts 19

(` In Lakhs)

AS AT 31.03.2011 AS AT 31.03.2010

The Schedules referred to above form an integral part of Balance Sheet


(A MINI RATNA COMPANY)

(A Subsidiary of Coal India Limited)

BALANCE SHEET AS AT 31ST MARCH 2011

M.SUBRAMANIAN RAMEHER SUSHIL BEHL D.C. GARGGeneral Manager (Fin) Company Secretary Director (Finance) Chairman-cum-Managing Director

(DIN-02841938) (DIN-00267658)

As per our report of even date

FOR C.R.SAGDEO & CO

Chartered Accountants( FRN 108959W )

CA. DR. JAYANT M RANADE

PARTNER

M.No. 017852

Place : Nagpur


(Rs. in Lakhs)

81


SCH

INCOM E :

G ross Sa les 203,495.06 707,344.27 674,763.13

Less: Levies 34,208.31 107,917.08 91,100.16

Net Sa les 1 169,286.75 599,427.19 583,662.97

Coa l issued for other purposes 2 1,577.55 5,951.11 7,326.07

O ther Incom e 3 16,989.47 55,387.45 56,035.43

Accre tion/ (Decre tion) in Stock 4 7,933.71 12,959.90 1,318.09

TOTAL 195,787.48 673,725.65 648,342.56

EXP ENDITURE

Internal Consum ption o f Coal 5 1,524.63 5,829.69 7,181.88

Em ployees rem unera tion and Benefits 6 65,456.19 272,419.92 261,329.82

Consum ption o f S to res and Spares 7 24,261.86 86,312.44 85,632.19

Power and Fue l 8 6,242.65 26,008.08 24,285.44

Repairs 9 5,362.89 13,839.60 12,285.62

Contractual expenses 10 15,327.59 46,750.58 57,097.90

Socia l A m en ities 11 10,088.36 29,689.13 25,109.01

O ther expenditure 12 16,815.61 33,213.67 34,806.41

Over Burden Rem ova l Ad justm ent 13 7,627.76 31,455.68 30,561.38

Interest and Financia l Charges 14 106.57 656.56 484.88

Deprec iation 4,050.12 17,325.17 16,692.17

Im pa irm ent Loss on Asse ts 333.05 603.77 448.41

Provis ions and write off 15 3,155.76 3,608.99 (1,756.89)

TOTAL 160,353.04 567,713.28 554,158.22

Profit fo r the Year 35,434.44 106,012.37 94,184.34

Prior P eriod Adjustm ent 16 826.49 784.19 (1,081.82)

Profit befo re tax (PBT) 36,260.93 106,796.56 93,102.52

Provis ion fo r Taxa tion :

Curren t Year 17,801.40 44,790.14 31,736.77

Earlier Years 921.74 11,138.50 (4,156.08)

De ferred Tax (2,011.49) (2,962.57) 960.84

Profit A fte r Tax (PAT) 19,549.28 53,830.49 64,560.99

Opening Profit and Loss Ba lance B/F - 193,282.38 184,390.56

PROFIT AVAILABLE FOR APPROP RIATION: 19,549.28 247,112.87 248,951.55

AP PROPRIATION

Interim D ividend - - -

F inal D ividend (P roposed) 32,324.48 32,324.48 38,741.84

Tax on D ividend 5,243.84 5,243.84 6,584.18

Tax on D ividend o f earlier year - (149.64) -

Transferred to CS R Reserve 2,066.93 2,739.68 659.00

Transferred to Genera l Reserve 8,075.00 8,075.00 9,684.15

Balance transferred to Balance Sheet (28,160.97) 198,879.51 193,282.38

658.00 1,811.86 2,173.04

S ign ificant Accounting Po licies 17Notes p roviding Sta tu tory In form ation 18Notes on Accounts 19

T he Schedules re ferred to above form an integra l part of P rofit & Loss Account

31/03 /2011 31/03 /2011 31/03/2010

Basic and D iluted earn ings per share o f Rs. 1000 each (in `̀̀̀)

For the Fourth

Quarter Ended

For the Year

Ended

For the Year

Ended




PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED ON 31ST MARCH, 2011

M.SUBRAMANIAN RAMEHER SUSHIL BEHL D.C. GARGGeneral Manager (Fin) Company Secretary Director (Finance) Chairman-cum-Managing Director

(DIN-02841938) (DIN-00267658)As per our report of even date

FOR C.R.SAGDEO & CO


CA. DR. JAYANT M RANADE, PARTNER

M.No. 017852

Place : Nagpur


(Rs. in Lakhs)

(in Rupees)

82


A) CASH FLOWS FROM OPERATING ACTIVITIES

Net Profit before taxation and extraordinary items

Adjustments for :

Depreciation

Interest income

Increase / (Decrease) in OBR Reserve

Interest expense

Provision for Doubtful Debts/Adavance/Claims

(Profit)/Loss on Sale of Assets

Operating profit before working capital changes

(Increase)/Decrease in Sundry Debtors

(Increase)/Decrease in inventories

(Increase)/Decrease in Loans & Advances

Increase/(Decrease) in Trade & Other Payables

Cash generated from operations

Direct Taxes paid (Net)

Cash flow before extraordinary itesms

Extraordinary Items

Net cash from operating activities

B) CASH FLOWS FROM INVESTING ACTIVITIES

Purchase of fixed assets

Proceeds from sale of Assets

Investments

Interest received

Net cash from investing activities

C) CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from long term borrowings

Repayment of long term borrowings

Interest paid

Dividend & Tax on dividend paid

Net cash used in financing activities

NET INCREASE IN CASH & CASH EQUIVALENTS (A+B+C)

CASH & CASH EQUIVALENTS AT BEGINNING OF PERIOD

CASH & CASH EQUIVALENTS AT END OF PERIOD

NOTES :1. Cash Flow Statement has been prepared under the indirect method as set out in the AS-3 R issued by the Institute of

Chartered Accountants of India.2. Purchase of Fixed Assets includes movements of Capital Work-in-progress between the beginning and the end of the year.3. Figures in brackets indicate cash outflow.4. Purchase of Fixed Assets include Foreign Currency fluctuation of Rs.623.00 lakhs5. Cash & Cash equivalents as on 31.3.2011 include Fixed Deposits of Rs.217.75 lakhs against which Bank Guarantees have

been issued.

106796.56

17762.02

(27288.26)

31455.67

159.14

(3165.42)

(41.29)

125588.42

11593.71

(14291.97)

9986.64

(17584.67)

115292.13

(61683.21)

53608.92

0.00

(23933.99)

239.96

3209.00

27288.26

623.00

(1318.19)

(159.14)

(45176.38)

2010-11

53608.92

6803.23

(46030.71)

14381.44

391996.42

406377.86




CASH FLOW STATEMENT FOR YEAR ENDED ON 31ST MARCH, 2011

(Rs. in Lakhs)

M.SUBRAMANIAN RAMEHER SUSHIL BEHL D.C. GARG

General Manager (Fin) Company Secretary Director (Finance) Chairman-cum-Managing Director

(DIN-02841938) (DIN-00267658)


FOR C.R.SAGDEO & CO


CA. DR. JAYANT M RANADE, PARTNER

M.No. 017852

Place : Nagpur


93102.52

17994.37

(22395.87)

30561.38

200.17

(1786.00)

(18.67)

117719.56

10020.59

(570.87)

(5859.64)

30330.23

151639.87

(38830.68)

112809.19

0.00

(25460.88)

344.58

4813.50

22334.21

0.00

(2408.36)

(200.17)

(23546.59)

2009-10

112809.19

2031.41

(26155.12)

88685.48

303310.94

391996.42

83


SCHEDULES TO BALANCE SHEET AS AT 31ST MARCH 2011 FORMING PART OF ACCOUNTS

SCHEDULE - A

AS AT 31.03.2011 AS AT 31.03.2010

(Rs. in Lakhs) (Rs. in Lakhs)

CAPITAL

Authorised

80,00,000 Equity shares of Rs. 1000/- each 80,000.00 80,000.00

Issued, Subscribed and Paid up

18,00,019 Equity Shares of Rs. 1000/- each fully paid up in cash 18,000.19 18,000.19

11,70,981 Equity Shares of Rs. 1000/-each allotted as fully paid up

for funds adjusted against purchase consideration other than cash. 11,709.81 11,709.81

29,710.00 29,710.00

NOTE: The entire Share Capital is held by Coal India Limited, the Holding Company and/or it’s nominee(s).

SCHEDULE -B

AS AT 31.03.2011 AS AT 31.03.2010


RESERVES AND SURPLUS

a) Capital Reserve 0.06 0.06

b) Other Specified reserves

Accumulated provision for futureoverburden removal

As per last Accounts 228,189.34 183,489.45

Addition during the year 45,942.93 44,699.89

274,132.27 274,132.27 2,28,189.34

Less : Expenditure on advance stripping (Quarries)

As per last Accounts 106,903.47 92,764.96

Addition for current year 111,384.79 107,918.77

218,288.26 200,683.73

Less : Charged during the year 96,897.53 121,390.73 93,780.26 106,903.47

152,741.54 121,285.87

c) Other Specified reserves (CSR) 659.00

-

Addition during the year 2,739.68 3,398.68 659.00 659.00

d) General Reserve 86,993.98 77,309.83

Transferred from Profit & Loss Account 8,075.00 95,068.98 9,684.15 86,993.98

e) Profit and Loss Account 198,879.51 193,282.38

450,088.77 402,221.29

SCHEDULE - C

AS AT 31.03.2011 AS AT 31.03.2010


UNSECURED LOANS

From C.I.L. ( the Holding Company)

Towards coal sector rehabilitation project (World Bank) 10,256.38 10,951.57

10,256.38 10,951.57

85



SCHEDULE - D

For the Quarter For the Year For the Year

Ended Ended Ended

31/03/11 31/03/2011 31/03/2010

Allocation of Depreciation

Depreciation on Fixed Assets 4,097.84 17368.43 16,684.41

Depreciation on P&M lying in Stores for more than 3 years (47.72) (43.26) 7.76

Impairment loss on Assets 333.05 603.57 448.41

Social Amenities 223.43 886.60 916.96

Prior Period Adjustment (1,145.36) (1,145.36) (94.86)

Capitalised 0.76 2.04 33.69

3,462.00 17672.02 17,996.37

AS AT 31.03.2011 AS AT 31.03.2010

Social Amenities Assets included

in the Schedule are as follows:-

a) Fixed Assets

(i) Land 336.24 336.24

(ii) Building 38,612.11 38,019.34

(iii) Plant and Machinery 6,539.82 6,494.17

(iv) Furniture and Fittings 387.66 384.31

(v) Vehicles 1,366.69 1,375.61

47242.52 46,609.67

b) Capital Work in Progress

(i) Buildings 515.07 1,368.86

(ii) Plant and Machinery 37.37 22.91

552.44 1,391.77

SCHEDULE E

(Rs. in Lakhs)

AS AT 31.03.2011 AS AT 31.03.2010

INVESTMENTS ( Long term, unquoted at Cost ):

8.5% tax free Govt. of Maharastra Special Bond 9,849.50 11,819.40

8.5% tax free Govt. of Madhya Pradesh Special Bond 6,195.50 7,434.60

16,045.00 19,254.00

Note: During the year redemption of Bonds are as under :

8.5% tax free Govt. of Maharashtra Special Bond 1,969.90 2,954.85

8.5% tax free Govt. of Madhya Pradesh Special Bond 1,239.10 1,858.65

3,209.00 4,813.50

(Rs. in Lakhs)

86


INVENTORIES

(Value as stated in item 6 of Schedule17 the

Accounting Policies and certified by the

management)

1) Stores and Spares parts 7,425.73 7,384.30

Less:Provision for Slow moving/ Non

moving/Obsolescence etc., 1,298.20 1,146.07

Less: Provision for shortage on stores 36.13 32.22

6,091.40 6,206.01

Stores in transit 521.18 161.26

Less: Provision 29.60 491.58 - 161.26

2) Stock of Coal Raw Coal in

Revenue Mines 33,986.87 21,005.85

Washery 72.41 106.93

Domestic fuel plant 1.05 1.05

34,060.33 21,113.83

Development Projects 1,116.36 -

35,176.69 21,113.83

Washed Coal 16.58 95.03

Middlings 23.59 9.25

Slurry Coal 821.15 609.22

Briquettes 0.32 0.32

36,038.33 21,827.65

Less:Provision for deterioration (Rev.) 1.37 1.37

36,036.96 21,826.28

3) Propsp. & Boring exp. non-CIL Blocks 355.20 355.20

Development if non-CIL blocks 52.59 407.79 52.59 407.79

3) Workshop Manufactured

Work-in-progress 679.59 751.80

Less: Provision 145.00 534.59 - 751.80

Finished Goods 146.77 63.98

43,709.09 29,417.12


SCHEDULE - F

(Rs. in Lakhs)

AS AT 31.03.2011 AS AT 31.03.2010

Stock of Raw Coal in

ofDevelopment of non-CIL blocks

87


A) RECONCILIATION OF BOOK STOCK AND MEASURED STOCK QTY. in '000' TONNES

VALUE IN `̀̀̀ LAKHS

PARTICULARS

RAW COAL QTY VALUE QTY VALUE QTY VALUE

1. OPENING STOCK AS ON 1.04.2010 2856.35 21113.83 Nil Nil 2856.35 21113.83

(AS PER ACCOUNTS)

2. ADD PRODUCTION FOR THE YEAR 2010-11 43654.38 - Nil Nil 43654.38 -

3. SUB TOTAL (1+2) 46510.73 - Nil Nil 46510.73 -

4. LESS OFF TAKE FOR THE YEAR 2010-11 .

A. OUTSIDE DESPATCH 42167.31 589655.01 Nil Nil 42167.31 589655.01

B. INTERNAL CONSUMPTION FOR WASHERY ETC. 384.12 5829.69 Nil Nil 384.12 5829.69

C. CONSUMPTION FOR BOILER AND DOMESTIC CO. 8.53 121.42 Nil Nil 8.53 121.42

TOTAL (4) 42559.96 595606.12 Nil Nil 42559.96 595606.12

5. DERIVED STOCK AS ON 31.03.2011 (3-4) 3950.77 35176.69 Nil Nil 3950.77 35176.69

6. MEASURED STOCK 3922.93 34854.94 Nil Nil 3922.93 34854.94

7. DIFFERENCES (5-6) 27.84 321.75 Nil Nil 27.84 321.75

8. BREAK UP OF DIFFERENCES :-

A. EXCESS WITHIN 5% 26.93 205.62 Nil Nil 26.93 205.62

B. SHORTAGE WITHIN 5% 54.77 527.37 Nil Nil 54.77 527.37

C. EXCESS BEYOND 5% NIL Nil Nil NIL

D. SHORTAGE BEYOND 5% NIL Nil Nil NIL

9. CLOSING STOCK ADOPTED IN ACCOUNTS 3950.77 35176.69 Nil Nil 3950.77 35176.69

(6-8A+8B)

QTY VALUE QTY VALUE QTY VALUE

OPENING STOCK 2.21 95.03 0.77 9.25 54.88 609.22

PRODUCTION 191.30 - 139.34 - 52.84 -

OFF TAKE 193.04 7443.81 138.29 1894.71 37.37 433.66

CLOSING STOCK 0.47 16.58 1.81 23.59 70.35 821.15

WASHED COAL MIDDLINGS SLURRY COAL

ANNEXURES TO SCHEDULE - F

PARTICULARS IN RESPECT OF COAL STOCK AS AT 31.03.2011

OVERALL STOCKPROVISION FOR NON-

VENDABLE STOCKVENDABLE STOCK

Notes: 1 There is a stock of 216.210 tonnes of Raw coal at Domestic Fuel Plant, Hinganghat. This has been included in bookstock as well as measured stock of Raw Coal.

2 Closing stock quantity includes 94472.69 Metric tonne of development coal at a value of Rs. 1116.36 lakhs.

88


Rs.

B). RECONCILIATION OF CLOSING STOCK ADOPTED IN ACCOUNTS WITH BOOK STOCK AS

AT THE END OF 31ST MARCH 2011

QTY '000'

TONNES

VALUE ̀

LAKHS

STOCK AS PER BOOKS (RAW COAL) 3,950.77 35,176.69

LESS : NET SHORTAGE OF MORE THAN 5% ACCOUNTED FOR IN THE ACCOUNTS BUT ADJUSTED FROM Nil

BOOK STOCK PENDING WRITE OFF.

LESS : NON VENDABLE STOCK INCLUDING MIXED STOCK AND STOCK ON FIRE FOR WHICH PROVISION Nil

EQUIVALENT TO THE VALUE HAS BEEN MADE IN ACCOUNTS BUT QTY. NOT ADJUSTED IN BOOK

STOCK AS WELL AS ACCOUNTS.

LESS : CHARGE FOR REHANDLING PITHEAD STOCK

LESS : PROVISION MADE IN THE ACCOUNTS TO TAKE CARE OF DETERIORATION IN 1.37

STOCK OF RAW COAL

STOCK AS PER A/C AFTER ALL PROVISIONS 3,950.77 35,175.32

ANNEXURE TO SCHEDULE F (Contd.)

PARTICULARS IN RESPECT OF COAL STOCK AS AT 31.03.2011

89


SCHEDULES TO BALANCE SHEET AS AT 31ST MARCH 2011

SCHEDULE - G (Rs.In Lakhs)

AS AT 31.03.2011 AS AT 31.03.2010

SUNDRY DEBTORS (UNSECURED)

Debts outstanding for a period exceeding six months 7,2771.61 15,495.30

Other debts 7,459.45 10,835.47

14,737.06 26,330.77

Less : Provisions for deductions/doubtful debts 12,217.18 15,412.87

2,519.88 10,917.90

CLASSIFICATION:

Considered good 2,519.88 10,917.90

Considered doubtful 12,217.18 15,412.87

Current Previous Current PreviousParticulars

Maximum amount due at

any time during Closing Balance

(Rs.In Lakhs)


SCHEDULE - H

AS AT 31.03.2011 AS AT 31.03.2010

CASH AND BANK BALANCES

Cash in hand 21.50 23.33

Cheques and drafts in hand 24.14 12.39

Remittances in transit 291.50 155.92

Balances with Schedule Banks

In Current Accounts 29,298.80 11,022.77

In Fixed Deposits / CLTD Accounts 376,741.92 380,782.01

406,377.86 391,996.42

Note: Balance with Scheduled Banks in Fixed Deposits / CLTD accounts include deposits for:

a) Undisbursed wages 206.93 272.70

b) 1% Electricity charges recovered from Non-Executives 1,655.12 1,123.41

c) Court cases for Union Fund, Relief Fund & 5% MPGATSVA 12,869.37 20,205.57

year year year year

Amount due from Coal India Ltd. the Holding Company - -

Central Mine Planning & Design Institute Limited - 0.03 - 0.03

(Rs.In Lakhs)

90


LOANS AND ADVANCES (UNSECURED)

(Advances recoverable in cash or in kind or for value to be received)

Advances to suppliers :

For Capital 117.96 195.64

For other 2,236.76 1,762.30

2,354.72 1,957.94

Advances to Contractors (Secured) 67.78 75.98

Advances to Contractors (Unsecured) 763.68 831.46 5,290.30 5,366.28

Advances to employees :-

For House Building (Secured) 323.42 468.43

For Motor Car and other Conveyance (Secured) 0.18 0.75

For others 877.52 1,006.57

1,201.12 1,475.75

Other Advances 637.52 231.98

Deposits:

P & T, Electricity etc. 3,301.93 2,789.38

Deposit with C.I.L.(Holding Company) 18,980.70 14,487.86

22,282.63 17,277.24

Prepaid expenses 728.94 702.75

Interest accrued on Bank deposit 10,760.94 8,633.22

Dues from Govt.:

Subsidy Receivable 642.32 626.69

Others 3,561.35 17,809.45

Advance Income tax paid 167,710.21 106,390.33

171,913.88 124,826.47

Claims Receivables- others 8,774.64 5,881.92

Accrued interest on House Build. Adv. to employees (Secured) 1,188.67 1,305.35

Accrued interest on Conveyance Adv. to employees (Secured) 58.27 77.27

Gratuity claims receivable 7,702.17 9,233.98

In Current Accounts with C.I.L. 1,140.97 1,136.16

229,575.93 178,106.31

Less : Provisions

For doubtful advances 551.99 519.75

For Claims 603.26 605.23

228,420.68 176,981.33

CLASSIFICATION :

Considered good 228,420.68 176,981.33

Considered doubtful 1,155.25 1,124.98


SCHEDULE - I

(Rs. in Lakhs)

AS AT 31.03.2011 AS AT 31.03.2010

s

91


CURRENT

YEAR

PREVIOUS

YEAR

CURRENT

YEAR

PREVIOUS

YEAR

Central M ine Planning & Design Institute Limited - - 716.79 4.97

South Eastern Coalfields lim ited - - 20.79 14.31

Eastern Coalfields Limited - - 0.40 6.99

Bharat Coking Coal limited - - 0.40 5.35

Mahanadi Coalfields Limited - - - 11.84

Northern Coalfields Limited - - 1.10 4.14

Central Coalfields Lim ited - - 1.41 0.93

AMOUNT DUE FROM DIRECTORS OR OTHER OFFICERS OF THE COMPANY MAXIMUM AMOUNT

8

Name of the Company

CLOSING BALANCE MAXIMUM AMOUNT

DUE AT ANY TIME


SCHEDULE - I (Contd.)

(Rs. in Lakhs)AMOUNT DUE FROM OTHER SUBSIDIARIES OF THE HOLDING COMPANY

CURRENT

YEAR

PREVIOUS

YEAR

CURRENT

YEAR

PREVIOUS

YEAR

Directors 1.50 1.12 9.72 11.49

CLOSING BALANCE

MAXIMUM AMOUNT

DUE AT ANY TIME

DURING CLOSING BALANCE

MAXIMUM AMOUNT

DUE AT ANY TIME

92


CURRENT LIABILITIES AND PROVISIONS

Current Liabilities :

Sundry Creditors (SSI Units) For expenses 53.26 53.26 103.88 103.88

Sundry Creditors (Others):

For Capital 1,754.70 2,723.06

For Stores 7,369.15 9,123.85 4,661.60 7,384.66

Sundry Creditors for expenses

Capital 1,249.58 1,435.33

Contractual expenses 1,181.78 1,365.78

Power and fuel 1,847.32 1,831.68

Others 20,748.30 21,266.13

Employees remuneration and benefits

Salaries Wages Allowances & benefits 58,296.18 50,127.21

Provision against NCWA-VIII & Executive pay - 56,376.61

Attendance Bonus 2,338.79 2,221.01

Performance Linked Reward Scheme (PLRS) &

Productivity Linked Bonus Scheme (PLBS) 30,570.64 20,465.82

Unpaid Salaries & Wages etc. 229.14 230.23

Gratuity 9,876.61 126,338.34 20,147.32 175,467.12

Statutory dues :

Sales Tax :

State 2,703.79 2,627.50

Central 436.67 3,140.46 470.31 3,097.81

Royalty & Cess

Royalty on Coal 5,630.77 5,351.33

Royalty on others 2.33 2.32

Cess on Coal 321.41 321.41

Central excise duty on Coal 3,166.58 -

Clean energy cess on Coal 1,940.96 -

Other Cesses 1.65 11,063.70 22.76 5,697.82

Stowing Excise Duty 1,160.73 1,240.35

Providend fund 848.41 880.47

Professional Tax 17.54 11.67

Income Tax: :

Employees 688.54 401.06

Contractors 255.25 943.79 457.92 858.98

Advances and Deposits

From Customers 57,084.44 37,624.09

From Contractors and others 8,400.55 65,484.99 8,022.99 45,647.08

Provision for Reclamation of Land 26,310.04 16,069.28

Current account with CIL - -

Other Liabilities 17,070.49 23,198.24

Provisions:

For Income Tax 115,220.96 59,669.25

Education cess 14.73 1.13

For Wealth Tax 40.00 33.70

For Dividend and dividend Tax 37,568.32 45,326.02

414,399.61 384,687.46


SCHEDULE - J

AS AT 31.03.2011 AS AT 31.03.2010

(Rs. in Lakhs)

93


SCHEDULES TO PROFIT AND LOSS A/C FOR THE YEAR ENDED

ON 31ST MARCH 2011 FORMING PART OF ACCOUNTS

SCHEDULE- 1

SALES

Coal 200,830.16 697,092.93 660,104.71

Washed Coal 1,939.34 7,758.24 10,570.77

Middling 587.25 2,059.44 2,914.10

Slurry Coal 138.31 433.66 1173.55

203,495.06 707,344.27 674,763.13

LESS : STATUTORY LEVIES

Central Excise duty 3,105.69 3,105.69 -

-

Clean energy cess 5,784.37 15,873.02 -

Royalty on Coal 16,715.67 58,971.09 60,528.60

Stowing Excise Duty 1,147.98 4,216.27 4,506.05

Sales Tax:

.

Central 844.43 3,258.73 3,034.30

State(VAT) 6,610.17 22,492.28 23,031.21

34,208.31 107,917.08 91,100.16

169,286.75 599,427.19 583,662.97

For the Quarter Ended

31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

COAL ISSUED FOR OTHER PURPOSES

Coal issued for canteen, club etc.

Coal issued for power

Coal for processing in washery

SCHEDULE- 2

2.05 33.52 51.77

50.87 87.90 92.42

1,524.63 5,829.69 7,181.88

1,577.55 5,951.11 7,326.07


31/03/2011

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

(Rs. in Lakhs)

94


SCHEDULE TO PROFIT AND LOSS A/C FOR THE

YEAR ENDED 31ST MARCH, 2011

SCHEDULE - 3

For the Quarter Ended For the Year Ended For the Year Ended

31/03/2011 31/03/2011 31/03/10

OTHER INCOME

Subsidy 948.24 2,148.35 1,765.38

Revenue from workshop 2,125.06 8,909.66 8,204.20

Surface Transportation Charges recoveries 3,063.33 10,797.73 12,703.00

Interest from Customers/employees 230.40 3,157.29 184.65

Interest received from I.Tax Dept. 1,517.20 1,517.20 61.66

Interest on Securitised State Govt. Bond (Tax free) 375.05 1,568.40 1,841.16

Interest on deposit with Bank 7,000.55 21,302.12 19,186.88

Interest from CIL( Holding Co.) 455.27 1,260.45 1,121.52

Profit on sale of assets 6.70 49.70 24.82

Credit from CMPDIL towards Geological Report Disposal - - 6,508.93

Rent from outsiders 11.09 32.60 34.22

Liquidated damages received 105.49 318.03 276.65

Tender fees 16.27 73.34 79.24

Discount 17.84 70.54 69.58

Sale of scrap 139.87 503.15 560.93

Beneficiation Charges 529.80 1,882.55 1,643.70

Others 447.31 1,796.34 1,768.91

16,989.47 55,387.45 56,035.43

(Rs. in Lakhs)

95


SCHEDULE TO PROFIT & LOSS ACCOUNT FOR THE


SCHEDULE - 4

ACCRETION/(DECRETION) IN STOCK

CLOSING STOCK:

Raw Coal 34,060.33 34,060.33 21,113.83

Washed Coal 16.58 16.58 95.03

Middlings 23.59 23.59 9.25

Slurry coal 821.15 821.15 609.22

Briquettes 0.32 0.32 0.32

34,921.97 34,921.97 21,827.65

Less: Provision for deterioration 1.37 34,920.60 1.37 34,920.60 1.37 21,826.28

W.I.P. in Workshop 679.59 679.59 751.80

Less: Provision 145.00 534.59 145.00 534.59 - 751.80

Add : Finished goods at workshop 146.77 146.77 63.98

35,601.96 35,601.96 22,642.06

Opening Stock

Raw Coal 25,841.64 21,113.83 19,379.39

Washed Coal 27.91 95.03 28.59

Middlings 36.97 9.25 0.90

Slurry Coal 763.37 609.22 625.89

Briquettes 0.32 0.32 0.32

26,670.21 21,827.65 20,035.09

Less : Provisions for Deterioration 1.37 26,668.84 1.37 21,826.28 1.37 20,033.72

W.I.P. in Workshop 892.03 751.80 790.70

Less: Provision - 892.03 - 751.80 - 790.70

Finished goods at workshop 107.38 63.98 122.36

27,668.25 22,642.06 20,946.78

7,933.71 12,959.90 1,695.28

Less : Development stock

brought to revenue -

- 377.19

7,933.71 12,959.90 1,318.09


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

96




SCHEDULE - 5

For the Quarter Ended For the Year Ended For the Year Ended

31/03/2011 31/03/2011 31/03/10

INTERNAL CONSUMPTION OF COAL

Coal for Processing in Washery 1,524.63 5,829.69 7,181.88

1,524.63 5,829.69 7,181.88

EMPLOYEES REMUNERATION AND BENEFITS

Directors Salary 19.60 82.67 67.80

alary to officers 6,623.44 23,490.73 21,968.00

Other salary, wages and allowances etc. 39,214.12 153,337.24 138,318.04

Overtime : Normal 2,696.13 10,765.45 10,614.73

Rest day Working 3,773.37 14,084.60 14,723.73

Incentive (45.65) (28.91) 62.73

Leave encashment 3,846.13 8,580.44 4,481.44

Fall back Wages 2.34 11.25 20.58

Contribution to PF & Other Funds

(Including admn.chrg.) 6,222.88 24,523.23 22,036.28

Attendance bonus 2,267.21 9,212.43 9,028.67

Performance linked reward scheme (PLRS),

PRP and Productivity Linked Bonus Scheme (PLBS) 3,341.72 18,326.39 20,909.00

Leave travel expenditure 991.04 3,091.31 2,378.02

House Rent Allowance 473.14 1,779.47 1,808.41

Retirement benefits :-

Pension 14.63 105.72 142.71

Gratuity (2,886.66) 8,086.80 18,099.90

Workmen’s Compensation 45.11 235.59 184.36

Deposit linked insurance - - 2.50

Life cover scheme 7.06 245.72 210.77

Voluntary retirement terminal benefits 53.95 245.76 -

Leave encashment on retirement 250.77 980.73 757.99

Other retirement benefits 205.69 901.32 717.37

67,116.02 278,057.94 266,533.03

Less : Transferred to Social Amenities Per Contra 1,659.83 5,638.02 5,203.21

65,456.19 272,419.92 261,329.82

SCHEDULE - 6


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

(Rs. in Lakhs)

97


CONSUMPTION OF STORES AND SPARES

Explosives 3,274.23 11,318.82 16,074.11

Timber 491.23 1,422.15 1,396.56

Petrol, oil, lubricants 10,296.24 38,321.21 35,239.48

HEMM Spares 4,576.67 13,857.41 12,677.52

Safety and Protective works Stores & Spares 733.76 2,390.65 2,649.36

Stores & Spares consumed in workshop 581.68 2,301.75 2,096.65

Other consumable stores and spares 4,363.16 16,907.44 15,679.82

24,316.97 86,519.43 85,813.50

Less :Transferred to Social Amenities Per Contra 55.11 206.99 181.31

24,261.86 86,312.44 85,632.19

SCHEDULE - 7


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

POWER AND FUEL

Electricity Charges 9,418.40 36,396.67 32,524.51

Power generation Consumption of Coal 50.87 87.90 92.42

9,469.27 36,484.57 32,616.93

Less : Transferred to Social Amenities Per Contra 3,226.62 10,476.49 8,331.49

6,242.65 26,008.08 24,285.44

SCHEDULE - 8


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

98


SCHEDULE TO PROFIT AND LOSS ACCOUNT FOR THE


SCHEDULE - 9


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

REPAIRS

Factory and office Buildings 134.11 200.51 168.95

Plant and Machinery 4,203.25 11,190.34 10,363.90

Rehabilitation expenses of HEMM 206.01 225.34 568.26

Office Furniture and equipment 45.08 76.39 45.28

Vehicle maintenance :

Petrol and Diesel 171.89 369.91 280.97

Repairs 68.91 186.46 194.15

Stores and Spares 82.83 194.75 190.65

Road Tax 10.87 39.99 45.06

Insurance 5.47 339.97 25.88 816.99 30.12 740.95

Others 434.47 1,330.03 398.28

5,362.89 13,839.60 12,285.62


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

SCHEDULE - 10

CONTRACTUAL EXPENSES

Transport Charges :

Coal 3,350.35 12,796.29 14,201.82

Sand 367.32 999.20 1,455.05

Wagon Loading 183.54 602.13 616.49

Underground Stopping/Protective work 168.49 371.88 339.10

Hiring of Equipment for earth work 8,471.38 26,017.19 35,298.50

Other Contractual work 2,786.51 5,963.89 5,186.94

15,327.59 46,750.58 57,097.90

99




SCHEDULE - 11


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

SOCIAL AMENITIES

Salaries,Wages & Allowances per contra 1,659.83 5,638.02 5,203.21

Free issue of coal to employees and others as per contra 2.05 33.52 51.77

Medical reimbursement 1,614.77 4,416.67 3,302.95

Medicine, Hospital consumable and diet expenses 136.10 423.77 474.57

Sports, recreation & Grants 75.76 116.77 116.96

Canteen upkeep and refreshment 18.48 44.12 55.90

Power Per Contra 3,226.62 10,476.49 8,331.49

Repairs and Maintenance of Township 865.74 1,336.29 1,013.28

Repairs and Maintenance of Vehicles


Repairs 9.78 55.41 51.29

Stores and Spares 3.79 9.05 9.71

Road Tax 5.14 49.94 45.35

Insurance 1.41 15.24 16.17

49.19 223.63 228.86

Training expenses 87.67 300.89 322.66

Depreciation 223.43 886.60 916.96

Consumption of Stores and Spare parts per contra 55.11 206.99 181.31

Donation to Schools and Institutions 386.35 861.26 706.75

Tree Plantation 219.56 538.40 476.24

Corporate Social Responsibility 481.32 729.89 393.19

Reimbursement of L.P.G. To Employees 576.47 2,080.84 2,001.00

Other welfare expenses 477.48 1,584.78 1,492.16

10,155.93 29,898.93 25,269.26

Less : Recoveries :

House Rent 28.93 66.09 63.44

Hospital Charges 1.73 7.47 7.43

Others 36.91 67.57 136.24 209.80 89.38 160.25

10,088.36 29,689.13 25,109.01

100




SCHEDULE - 12

OTHER EXPENDITURE

Travelling

(i) In Country 453.82 1,626.15 1,480.16

(ii) Outside Country (1.49) 27.77 31.63

Printing and Stationery 105.24 318.40 288.56

Computer software - - 0.85

Postage and Telegram 8.99 32.88 29.90

Telephone 68.87 207.29 201.80

Advertisement & Publicity 55.68 295.93 251.24

Freight Charges 8.40 28.59 64.30

Under-loading/ over-loading charges 98.40 572.76 826.38

Demurrage on left behind wagons 65.92 395.95 202.31

Subscription and Contribution 19.64 45.61 33.27

Rent 36.78 108.34 131.63

Rent for office equipments 0.54 8.57 8.93

Rent for Computer 32.96 128.49 83.05

Hire charges for private vehicles 613.49 2,037.11 1,596.82

Land reclamation 10,652.63 10,240.76 9,736.66

Hire charges for private security 397.77 1,809.57 1,150.42

Tech .Assistance & Proj. Implementation 21.39 406.66 358.79

Repairs and Maintenance of car and jeep


Repairs 37.56 92.75 75.34

Stores and spares 20.32 59.01 64.11

Road tax 3.99 8.35 2.70

Insurance 0.96 106.27 10.27 327.61 9.51 297.80

Legal expenses 28.93 92.68 101.41

Bank Charges 85.73 191.49 214.62

Consultant/ Retainers fees, expenses 310.72 907.40 1,114.63

Loss on sale / discarding of assets 0.52 8.41 6.15

Auditors' remuneration

Audit fees 2.88 11.53 11.53

In other capacity(Tax & VAT Audit) 16.08 16.08 6.48

Traveling and out of pocket expenses 4.11 23.07 4.86 32.47 2.37 20.38

Management Audit expenses 19.73 25.73 32.46

Insurance 0.73 2.09 2.79

Rates and Taxes 196.26 624.74 467.90

Wealth Tax 10.00 45.85 46.70

Royalty and cess 286.20 1,012.05 1,236.30

Service charges of holding Company 685.38 2,408.27 2,518.44

Rehabilitation of Jharia Coalfields 696.54 2,553.54 2,730.00

Conferences and seminars 80.84 264.05 234.09

Quality allowance (235.02) 189.70 603.74

Environmental protection expenditure 590.39 1,308.02 1,111.07

Assets not belonging to the Company - - 4,508.00

Other Miscellaneous expenses 1,290.29 4,928.74 3,083.23

16,815.61 33,213.67 34,806.41


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

101



Ended Ended Ended

31/03/11 31/03/2011 31/03/2010

OVER BURDEN REMOVAL ADJUSTMENT

Opening Advance stripping 115,384.13 106,903.47 92,764.96Addition to or withdrawal from ratio variance

during the year 13,634.36 45,942.94 44,699.89 129,018.49 152,846.41 137,464.85

Less : Closing advance stripping 121,390.73 121,390.73 106,903.47 7,627.76 31,455.68 30,561.38


Ended Ended Ended

31/03/11 31/03/2011 31/03/2010

INTEREST AND FINANCE CHARGES

On post retirement pension benefit scheme 6.12 9.62 1.24

Others (21.28) 22.40 12.05

Interest on Income Tax 85.94 465.40 271.42

Interest on account of World Bank Loan 35.79 159.14 200.17 106.57 656.56 484.88


Ended Ended Ended

31/03/11 31/03/2011 31/03/2010

PROVISIONS AND WRITE OFF

a) Write off:Write off of Debts / claims

- 3,719.77 7.87Write off of Assets

35.20 44.72 -b) Provisions:Bad and Doubtful Debts 88.00 (3,195.69) (1,786.00)

Provision for Excise Duty 2,824.28 2,824.28 -

Non moving and obsolete stores 181.73 181.73 21.99

Shortage in Stores 3.91 3.91 -

Doubtful advances 32.24 32.24 (104.46)

Claims (9.60) (1.97) 103.71

3,155.76 3,608.99 (1,756.89)



SCHEDULE - 13

SCHEDULE - 14

SCHEDULE - 15

(Rs. in Lakhs)

102




SCHEDULE - 16

PRIOR PERIOD ADJUSTMENT

DEBIT:

Salaries,Wages, Allowances 425.93 425.93 20.36

Consumption of Stores and spare parts (9.96) (9.96) (59.72)

Freight - - -

Rent Rates and Taxes - - 5.19

Repairs and Maintenance - - -

Depreciation (1,145.36) (1,145.36) (94.86)

Interest - - 1,145.57

Contractual Expenses 48.68 (56.49) (9.21)

OBR Adjustment - - -

Other welfare expenses (29.24) (29.24) -

Other expenses (29.56) 117.91 121.03

Total: (739.51) (697.21) 1,128.36

CREDIT :

Sales - - 46.54

Other Income 86.98 86.98 -

Total: 86.98 86.98 46.54

NET: 826.49 784.19 (1,081.82)


31/03/2011

(Rs. in Lakhs)

For the Year Ended

31/03/2011

For the Year Ended

31/03/2010

103


SIGNIFICANT ACCOUNTING POLICIES

1.0 Accounting Convention:

Financial statements are prepared under the historical cost convention on accrual basis,in accordance with the requirements of the Companies Act , 1956 and in compliancewith the Accounting Standards referred to in Section 211 (3C) except as otherwise statedelsewhere.

2.0 Basis of Accounting:

All expenses and incomes are booked initially in the natural heads of accounts and thentransferred to functional heads wherever required.

3.0 Subsidies/Grants from Government:-

3.1 Subsidies / Grants on capital account are deducted from the cost of the respectiveassets to which they relate. The unspent amount at the year end, if any, is shownas current liabilities.

3.2 Subsidies / Grants on revenue account are credited to Profit & Loss Accountunder the head other receipts and the relevant expenses are debited to the respective heads. The unspent amount at the year end, if any, is shown as currentliabilities.

4.0 Fixed Assets:-

4.1 Land : Value of Land includes cost of acquisition, cash rehabilitation expenses andre-settlement cost incurred for concerned displaced persons. Other expenditure incurredon acquisition of Land viz. compensation in lieu of employment etc. are, however, treatedas revenue expenditure.

4.2 Plant & Machinery : Plant and Machinery includes cost and expenses incurred forerection / installation and other attributable cost of bringing those assets to working condition for their intended use.

4.3 Railway Siding : Pending commissioning, payment made to the railway authorities forconstruction of railway siding are shown under Capital work-in-progress.

4.4 Development : Expenses net of income of the projects/mines under development arebooked to Development account and grouped under Capital work-in-progress ill theProjects / Mines are brought to revenue account.

“Except otherwise specially stated in the project report to determine the commercial

readiness of the project to yield production on a sustainable basis and completion of



SCHEDULE - 17

ACCOUNTING POLICIES FORMING PART OF BALANCE SHEET

AS AT 31ST MARCH 2011AND PROFIT & LOSS ACCOUNT

FOR THE PERIOD ENDED ON THAT DATE

104


required development activity during the period of construction, projects and mines

under development are brought to revenue:

a. From beginning of the financial year immediately after the year in which the

project achieves physical output of 25% of rated capacity as per approved project

report, or

b. Two years of touching of coal , or

c. From the beginning of the financial year in which value of production is more

than total expenses,

— Whichever event occurs first.”

4.5 Prospecting & Boring and other Development expenditure :

The cost of exploration and other development expenditure incurred in one “Five year”

plan period will be kept in Capital work-in-progress till the end of subsequent two “Five

year” plan periods for formulation of projects before it is written-off except in the case of

Blocks identified for sale or proposed to be sold to outside agency which will be kept in

Inventory till finalisation of sale.

5.0 Investments:

All investments, being long term in nature, are stated at cost.

6.0 Inventories :

6.1.0. Book stock of coal / coke is considered in the Accounts where the variance between

book stock and measured stock is upto +/- 5% and in cases where the variance is

beyond +/- 5% the measured stock is considered. Such stock are valued at Net Realisable

Value or cost whichever is lower.

6.1.1. Slurry, middlings of washeries are valued at net realisable value.

6.1.2. Stock of stores & spare parts at Central & Area Stores are valued at cost calculated

on the basis of weighted average method . The year-end inventory of stores & spare

parts lying at collieries / sub-stores / consuming centers, initially charged off, are valued

at issue price of Area stores, Cost / estimated cost. Workshop jobs including work-in-

progress are valued at cost.

6.1.3. The expenditure on Prospecting & Boring and Development in respect of non-CIL Blocks

intended to sale are treated as inventory and valued at cost.

6.2.1 Stores & Spares:

The closing stock of stores and spare parts has been considered in the Accounts as per

balances appearing in priced stores ledger of the central stores and as per physically

verified stores lying at the collieries/units.

6.2.2. Stores & spare parts include loose tools.

6.2.3. Provisions are made at the rate of 100% for unserviceable, damaged and obsolete

stores and at the rate of 50% for stores & spares not moved for 5 years.

105


6.2.4. Stock of Stationery, bricks, sand, medicine (except at Central Hospitals) and scraps arenot considered in inventory.

7.0. Depreciation:

7.1 Depreciation on Fixed Assets is provided on straight line method at the rates and mannerspecified in Schedule XIV of the Companies Act, 1956 (as amended) except for:

i. Telecommunication equipments and electronic items are depreciated over thetechnically estimated life, at higher rates, viz; @ 15.83% and @ 11.31% respetively.

ii. Depreciation on certain Heavy Earth Moving Machineries (HEMMs) are chargedover the technically estimated life at higher rates viz. @11.88%,@13.57%,@15.83% as applicable.

iii. Depreciation on Side Dump Loader(SDL) and Load Haul Dumper(LHD) arecharged over the technically estimated life at higher rates viz @19% [email protected]% respectively.

Depreciation on the assets added / disposed off during the year is provided on pro-ratabasis with reference to the month of addition / disposal, except on those assets attracting100% depreciation p.a.(SLM basis), which are fully depreciated in the year of their addition.

7.2 Value of land acquired under Coal Bearing Area (Acquisition & Development) Act, 1957is amortised on the basis of the balance life of the project. Value of leasehold land isamortised on the basis of lease period or balance life of the project which-ever is earlier.

7.3 Prospecting, Boring and Development expenditure are amortised from the year when theMine is brought under revenue in 20 years or balance working life of the Project whichever is less. Subsequent Expenditure falling under this category shall be amortised over20 years or balance life of the project from the year of incurrence of expenditure.

7.4 Assets attracting 100% depreciation,other than items individually costing Rs.5,000/- orless are taken out from the Accounts after expiry of two years following the year in whichthese are fully depreciated. Individual assets costing Rs.5,000/- or less is depreciatedfully in the year of addition but these are removed from books of accounts after they aresurveyed off.

8.0 Impairment of Assets:

8.1 Impairment loss is recognized wherever the carrying amount of an asset is inexcess of it’s recoverable amount and the same is recognized as an expenses inthe statement of profit & loss and carrying amount of the asset is reduced to it’s recoverable amount.

8.2 Reversal of impairment losses recognized in prior years is recorded when there is anindication that the impairment losses recognized for the asset no longer exist or havedecreased.

9.0 Foreign Currency Transactions:

9.1 Year– end balance of foreign currency transactions is translated at the year- end ratesand the corresponding effect is given in the respective accounts. Transactions completedduring the year are adjusted on actual basis.

106


9.2 Transactions covered by cross currency swap options contracts to be settled on future

dates are recognized at the year-end rates of the underlying foreign currency. Effects

arising out of such contracts are taken into account on the date of settlement.

10.0 Retirement Benefits/Other Employee benefits;

a. Defined contribution plans: The company makes contributions towards Provident

Fund and Pension Fund to a defined contribution retirement benefit plan for qualifying

employees. The Provident Fund and Pension Fund are operated by the Coal Mines Provi

dent Fund (CMPF) Authorities. As per rules of these schemes, the Company is required

to contribute a specific percentage of pay roll cost to the CMPF Authorities to fund the benefit.

b. Defined Benefit Plans: Year end liability, on account of gratuity and leave

encashment is provided for on actuarial valuation basis by applying projected unit credit

method. Further the Company has created a trust with respect to establishment of funded

Group Grauity (cash accumulation) Scheme through Life Insurance Corporation of

India. Contribution is made to the said fund based on actuarial valuation.

c. Other employee benefits: Further year–end liability of certain other employee

benefits viz. benefits on account of LTA/LTC, Life cover scheme ,Group

Personal Accident Insurance Scheme ,Settlement allowance, retired executive medical

benefit scheme and compensation to dependents of deceased in mines accident etc. are

also valued on actuarial basis by applying projected unit credit method.

11.0 Recognition of Income and Expenditure;

Income and Expenditure are generally recognized on accrual basis and provision is

made for all known liabilities.

12.0 Borrowing Costs:

Borrowing cost directly attributable to the acquisition or construction of qualifying as

sets are capitalized. Other borrowing costs are recognized as expenses in the period in

which they are incurred.

13.0 Taxation:

Provision for current income tax is made in accordance with the Income Tax Act,1961.

Deferred tax liabilities and assets are recognized at substantively enacted tax rates,

subject to the consideration of prudence, on timing difference between taxable income

and accounting income that originate in one period and are capable of reversal in one or

more subsequent period.

14.0 Provision:

A provision is recognized when an enterprise has a present obligation as a result of past

event; it is probable that an outflow of resources embodying economic benefit will be

required to settle the obligation, in respect of which a reliable estimate can be made.

Provisions are not discounted to present value and are determined based on best

estimate required to settle the obligation at the Balance Sheet date.

107


15.0 Contingent liability:

15.1. Contingent liability is a possible obligation that arises from past events and the existence of which will be confirmed only by the occurrence or non-occurrence of one or more

uncertain future events not wholly within the control of the enterprise or a present obligationthat arise from past events but is not recognized because it is not probable that an outflow of resources embodying economic benefit will be required to settle the obligations orreliable estimate of the amount of the obligations can not be made.

15.2. Contingent liabilities are not provided for in the accounts and are disclosed by way ofnotes.

16.0 Balance with Coal India Limited ( Holding Company ).

Amount due to Coal India Limited on account of loan after adjustment for conversion toequity or vice-versa from time to time is shown as Unsecured Loan. Amount due /receivable for revenue nature transaction in Current Account is shown under currentliabilities / current assets.

17.0 Apex Office Charges and Interest to Holding Company.

17.1. Apex office charges as charged by Holding Company is allocated to revenue mineson the basis of coal production.

17.2. Interest on loans from CIL is accounted for as per terms of loan agreement. Interest isallocated to the units on the basis of Gross Fixed Assets (excluding the Assetsprocured against specific loan) at the beginning of the year.

18.0. Overburden Removal (OBR) Expenses.

In Opencast mines with rated capacity of 1 million tones and above, the cost of OBR ischarged on technically evaluated average ratio (Coal : OB) at each mine with dueadjustment for advance stripping and ratio variance account after the mines are broughtto revenue. Net of balance of advance stripping and ratio variance at the end of the yearis shown as cost of removal of overburden.

The reported quantity of overburden is considered in the Accounts where the variancebetween reported quantity and measured quantity is within the permissible limitsdetailed hereunder :

If the variance betwen reported quantity and measured quantity is more than the abovetolerance limit, measured quantity will be considered in the accounts.

19.0. Income / expenditure items relating to prior period(s) which do not exceedRs.5,00,000/- in each case are treated as income / expenditure for the current year.

Permissible limits of variance

(whichever is less )

Annual Quantum of OBR of the

Mine

% Quantum (in Mill. Cu. Mtr.)

Less than 1 Milli. Cum. +/- 5 0.03 Between 1 and 5 Mill. Cum. +/- 3 0.20 More than 5 Mill. Cum +/- 2 (-)

108


SCHEDULE 18

NOTES PROVIDING STATUTORY INFORMATION

1. CONTINGENT LIABILITIES

Claims against the Company not acknowledged as debts as on 31st March 2011, amountingto Rs.66417.49 lakhs (Previous Year Rs.59309.69 lakhs), include:

a) Claims under Income Tax, Sales Tax, Service Tax and other Acts:

i. Demand notices from Income Tax authorities for Rs. 24251.20 lakhs towards CorporateTax and Rs.312.69 lakhs towards Tax on perquisites to employees.

ii. Demand notices from Income Tax authorities for Rs.77.30 lakhs under section 194 Jrws 201(1)of the Income Tax Act. 1961.

iii. Demand raised by District Revenue Authorities on account of Surface Rent Rs.992.51lakhs and Non-Agricultural Assessment Tax of Rs.5096.45 lakhs.

iv. Demands raised by Sales Tax Authorities on account of Sales Tax amounting toRs.853.42 lakhs.

v. Demands raised by Sales Tax Authorities on account of Entry Tax amounting toRs.9637.15 lakhs on HEMM and Rs.146.89 lakhs on coal.

vi. Demands raised by Service Tax Authorities on account of Service Tax amountingto Rs.158.74 lakhs.

b) Claims other than those under Income Tax, Sales Tax, Service Tax and other Acts:

i. Claims for enhanced compensation by land owners amounting to Rs. 8545.41 lakhs.

ii. Claims by employees towards remuneration related cases amounting to Rs.655.12 lakhs

iii. Claims by Contractors & others pending decision by Arbitration/ Courts Rs.5684.22 lakhs.

iv. Claims by customers Rs.2820.54 lakhs.

v. Claims by Railways for Siding maintenance Charges Rs.202.26 lakhs

vi. There are claims by employees and others where the amounts are not specified.In some cases interest has been claimed. However as the amounts are notspecified, the contingent liability is not ascertainable.

c) Letters of Credit and Bank Guarantees:

i. Letters of Credit outstanding as on 31st March 2011 amounting toRs.417.98 lakhs

ii. The Company has issued Bank Guarantees amounting to Rs. 217.75 lakhs (PreviousYear Rs. 4.00 lakhs) in favour of Maharashtra Pollution Control Board and Rs.24.75lakhs in favour of Collector Chhindwara (Previous Year Rs.24.75 lakhs).

109


2. CAPITAL COMMITMENT

The estimated amount of contracts remaining to be executed on Capital Account and notprovided for in the Accounts Rs. 6174.31 lakhs (Previous Year Rs. 7360.60 lakhs).

3. DETAILS OF OPENING STOCK, PRODUCTION, TURNOVER AND CLOSING

STOCK :

( A ) COAL :

OPENING STOCK :

Current Year (2010-11) Previous Year (2009-10)

Qty '000 MT Value in

Rs. Lacs


Rs. Lacs

Raw Coal (Revenue Projects) 2856.35 21113.83 2592.13 19379.39

Raw Coal Stock brought to Revenue

0.00 0.00 38.10 377.19

Washed Coal 2.21 95.03 0.73 28.59

Middling 0.77 9.25 0.08 0.90

Slurry 54.88 609.22 61.97 625.89

2914.21 21827.33 2693.01 20411.96



Rs. Lacs


Rs. Lacs

Raw Coal (Revenue Projects) 43520.88 45619.18

Raw Coal (Development Projects)

133.50 115.93

Washed Coal 191.30 246.26

Middling 139.34 188.75

Slurry 52.84 66.72

44037.86 46236.84



Rs. Lacs


Rs. Lacs

Raw Coal 42167.31 589655.01 44997.10 569004.55

Washed Coal 193.04 7443.81 244.78 10570.77

Middlings 138.29 1894.71 188.06 2914.10

Slurry Coal 37.37 433.66 73.81 1173.55

42536.01 599427.19 45503.75 583662.97

Internal Consumption 8.53 121.42 10.14 144.19

Issued for Process in Washery 384.12 5829.69 501.75 7181.88

392.65 5951.11 511.89 7326.07

PRODUCTION

TURNOVER

s

s

110




Rs. Lacs Qty '000 MT Value in

Rs. Lacs

Raw Coal (Revenue Projects) 3856.30 34060.33 2856.35 21113.83

Raw Coal (Development Projects)

94.47 1116.36 0.00 0.00

Washed Coal 0.47 16.58 2.21 95.03

Middling 1.81 23.59 0.77 9.25

Slurry 70.35 821.15 54.88 609.22

4023.40 36038.01 2914.21 21827.33

CLOSING STOCK :

Notes:

1) Production figures are derived from records of dispatches, internal consumption etc., and

adjustments for opening and closing stock of Coal.

2) Opening and Closing stock of Raw Coal includes coal stock of 216.210 MT of DFDP,

Hinganghat.

3) Despatch Quantity of Raw coal includes 38906.76 metric tonne from development mine

Sale value of this quantity Rs. 690.17 Lakhs(net of levies) is charged to development as Ac

counting policy.

(B) BRIQUETTE AT DOMESTIC FUEL PLANT, HINGANGHAT :

4. INSTALLED/LICENSED CAPACITY:

(a) COAL : Not Applicable

(b) BRIQUETTE: At Domestic Fuel Plant, Hinganghat : Not applicable since plant closed

in 1994


Qty MT Value in

Rs. Lacs

Qty MT Value in

Rs. Lacs

Opening Stock 58.00 0.32 58.00 0.32

Production 0.00 0.00 0.00 0.00

Turnover 0.00 0.00 0.00 0.00

Internal Consumption 0.00 0.00 0.00 0.00

Closing Stock 58.00 0.32 58.00 0.32

s

112


I. Registration Details

Registration No. 0 0 0 0 1 8 6 2 6 State Code 1 1

3 1 0 3 2 0 1 1

II. Capital raised during the year (Amount in Rs.'000)

N I L N I L

N I L N I L

III. Position of Mobilisation and Deployment of Funds (Amount in Rs.'000)

9 1 0 3 6 9 9 7 0 9 1 0 3 6 9 9 7

Sources of Funds

0 2 9 7 1 0 0 0 0 4 5 0 0 8 8 7 7

N I L 0 1 0 2 5 6 3 8

Application of Funds

1 7 1 6 1 9 6 1 0 1 6 0 4 5 0 0

2 6 7 3 7 8 0 1 N I L

N I L

Net Current Assets Miscellaneous Expenditure

Accumulated Losses

Secured Loans Unsecured Loans

Net Fixed Assets Investments

Total Liabilities Total Assets

Paid-up Capital Reserves & Surplus

Public Issue Rights Issue

Bonus Issue Private Placement

Balance Sheet Date

Date Month Year

SCHEDULE - 18

Balance Sheet Abstract and Company's Business Profile

113


IV. Performance of Company (Amount in Rs.'000)

5 9 9 4 2 7 1 9 4 9 2 6 3 0 6 3

+ 1 0 6 7 9 6 5 6 + 0 5 3 8 3 0 4 9

1 8 1 1 . 8 6

V. Generic Names of Three Principal Products/Services of the Company (as per Monetary Terms)

Item Code No. 2 7 0 1 1 2 0 0

B I T U M I N O U S C O A L

Item Code No. 2 7 0 1 1 9 0 2

S T E A M C O A L

Item Code No. 2 7 0 1 1 9 0 1

C O K I N G C O A L

Product Description

Product Description

0.00% 108.80% 108.80%

Product Description

Profit/Loss Before Tax Profit/Loss After Tax

Earning Per Share in Rs. Dividend Interim Final Total

Turnover Total Expenditure

114


WESTERN COALFIELDS LTD.

SCHEDULE - 19

NOTES ON ACCOUNTS

1. BACKGROUND:

Western Coalfields Limited came into existence after Nationalization of Coal Mines and

was incorporated on 29th October, 1975 upon take-over of assets and liabilities as at 1st

November, 1975 vested with the Western Division of Coal Mines Authority Limited.

2. LOAN FUND :

SECURED : Nil . However, a charge has been created for Rs. 165 crores on current

assets for securing working capital facility from CIL’s Consortium Banks as per modified

Joint Deed of Hypothecation dated 01.09.2008. This loan has, however, not been availed

so far.

UNSECURED LOANS:

NOTES :

i) Loans obtained from Coal India Ltd amounting to Rs.10256.38 Lacs, comprise of :

a) Loan for Coal Sector Rehabilitation Project from International Bank for

Reconstruction and Development ( IBRD) – Rs. 4707.38 lacs.

b) Loan for Coal Sector Rehabilitation Project from Japan Bank of International

Cooperation ( JBIC) ( formerly known as Export-Import Bank of Japan) –

Rs. 5549.00 lacs.

ii) During the year there is an increase in the loan amount due to exchange fluctuation to

the tune of Rs. 623.00 lacs.

3. FIXED ASSETS:

a) Company took over various assets from the Coal Mines Labour Welfare Organisation

(since repealed) situated at various locations and Coal Mines Rescue Station at

Pench, in the years 1984 and 1986 respectively, consequent to decision by Government

of India. These Assets have not been incorporated in the Accounts pending finalisation

of purchase consideration thereof by the Central Government. Accounting adjust

ment would be made on final determination.

b) Fixed Assets taken over by Company from Western Division of Coal Mines Authority

of India Ltd, vested consequent to nationalisation of Coal Mines, appearing as “As

NAME OF FINANCIAL INSTITUTION

BALANCE AS ON 1.4.2010

EXCHANGE FLUCTUATION DURING THE

YEAR

REPAYMENT DURING THE

YEAR

BALANCE AS ON 31.3.2011

(2+3-4)

REMARKS

(1) (2) (3) (4) (5) (6)

CIL-World Bank Loans

10951.57 (+) 623.00 1318.19 10256.38 Notes i & ii

TOTAL 10951.57 (+) 623.00 1318.19 10256.38

(Rs in Lakhs)

115


sets taken over on Nationalisation” under the head ‘Fixed Assets’, stood depreciated

in the course of earlier years and are appearing in accounts at a total residual value

of Rs. 1 lakh only.

c) Land, acquired under Land Acquisition Act, CBA (A&D) ACT, and on private negotia-

tions, amounting to Rs.389.51 lacs (Previous year Rs. 250.30 lacs) are, included in Fixed

Assets, on the basis of payments/compensation made as per approval of Competent

Authorities pending final settlement. Area-wise figure is as appearing in Annexure at

S.No.1(e).

d) Some of the title deeds/lease deeds for land, buildings and mining rights continue to

be held in the name of Coal India Ltd, pending transfer formalities. Title deeds/Lease

deeds in respect of Land are subject to verification.

e) Inventory of Steel, Cement, Cables, Conveyors, etc. lying at year end are forming

part of Capital Work-In-Progress.

f) In respect of Chandrapur Area, till date the ownership of land valued at Rs. 2324.66

lakhs has not been vested with the Area, the amount paid is kept in advance A/c. The

amount will be transferred to Land account as soon as the approval is received from

Ministry of Environment and Forest, Government of India. Similarly, in respect of

Umrer Area a sum of Rs. 76.77 lakhs has been paid to Special Land Acquisition Officer

towards 2/3rd value of land for purchase of land in respect of MKD-I OC project and is

kept in advance account. Balance amount is shown in Capital commitments.

g) DFD Plant and CBE Plant continue to remain inoperative during the year. CBE Plant

stands closed since 2003 and DFD Plant since 1994. Leasehold Land of DFD Plant

is being amortized over the lease period of 30 years. Plant & Machinery of CBE

Plant, excepting Hospital Equipments, has been disposed off by auction through

MSTC. All the other assets of both these plants are carried in the books at a residual

value of 5% of their cost.

h) Physical verification of Fixed Assets as on 31.03.2003 was done in all the Areas by

firms of Chartered/Cost Accountants and their reports were received. An outside

agency has done the reconciliation for inter-area and intra-area transfers and their

report has been received. The inter-area adjustments as a consequence is under

process. However, physical verification of assets valued at Rs. 1 lakh and above is

done by local Area management every year. Wherever Reports have been received

the reconciliation work is in progress.

i) Discarded / surveyed off assets lying in Stores, amounting to Rs. 1846.83 lacs (previ

ous year Rs.1724.90 lacs) valued at 5% residual value have not been physically veri

fied. Area-wise figures are as appearing in Annexure at S.No.1(b).

During the year there is no addition to the existing provision of Rs. 115.82 lacs.

Since in the opinion of management, expected realisable value is more than the book

value, no further provision has been made.

j) The carrying cost of the Fixed Assets in World Bank aided projects have been

adjusted to the extent of Foreign Exchange fluctuations in case of loans from World

Bank to the tune of Rs. (+) 623.00 lacs, (previous year Rs. (-) 1159.73 lacs) as

intimated by Coal India Ltd.

116


4. DEPRECIATION :

a) The effect of foreign currency fluctuation in case of loans from World Bank has

been adjusted in the cost of Fixed Assets. Necessary adjustment is made to de

preciation prospectively for the remaining useful life of the assets.

b) Depreciation has been provided on Plant &Machinery lying in Stores for more than

three years. The resultant impact in current year is Rs. (-)43.26 lacs (Previous year

Rs.(+) 7.76 lacs). Area-wise figures are as appearing in Annexure at S.No.1(c).

5. CAPITAL WORK IN PROGRESS (CWIP) :

a) Area-wise CWIP pending since more than 3 years is Rs.1662.25 lacs as shown in the

Annexure at S.No. 1(a) (Previous year Rs. 1592.90 lacs).

b) CWIP in Nagpur Area includes Rs. 38.75 Lacs towards the cost of work of widening of

colony road at Kamptee OC mine incurred upto 31.03.2008. Work has been stopped

by the contractor and the matter is under investigation.

6. INVENTORY:

a) Provision for Non-Moving Stores & Spares, not moved for 5 years is made, as per

company’s accounting policy, @ of 50% and @ 100% for unserviceable, damaged

and obsolete stores. Total provision as on 31.03.2011 is as under:

During the year an additional revenue provision has been made to the tune of Rs.152.13

lacs. Thus the Year-end provision on this account stands at Rs.1298.20 lacs (Previ-

ous year Rs.1146.07 lacs). There has been a withdrawal of capital provision to the

tune of Rs. 3.21 lacs. Thus the year-end closing capital stores provision stands at ‘

22.11 lacs (Previous year Rs.25.32 lacs).

7. SUNDRY DEBTORS:

a) In accordance with the new Fuel Supply Agreements, under NCDP, between the

Company and MAHAGENCO, MPPGCL, KPCL, GSECL, UPSEB and other

private parties, from the year 2009-10, coal sales bills are raised for 100 % value

of coal plus 100% duties & taxes. Supplementary bills/credit notes, if any, are raised

after receipt of acceptable quality analysis reports of sampling at loading and

unloading ends, in respect of power sector. However, as in past, in respect of

mines having cost plus agreement for supply of coal, coal sales bills are initially

raised only for 90% value of coal plus 100% duties and Taxes. Final bills (for

balance value) are raised after receipt of acceptable quality analysis reports of sam

pling at loading and unloading ends. For the current year final bills consisting of

10% portion towards rate revision w.e.f.01.01.2011 amounting to Rs. 2067.72 lacs

have been accounted for . Area-wise figure is as appearing in Annexure at S.No.2(a).

b) As per approval of the Board of Company an amount of Rs.3719.77 lacs towards old

outstanding dues of MSPGCL has been written off and the corresponding provision

to that extent has been withdrawn. Further an additional provision of Rs.524.08 lacs

Sl.No. Particulars Revenue Stores Capital Stores

i) On Non Moving Stores (50% provision) 873.49 22.11

ii) On Obsolete Stores (100% provision) 424.71

(Rs. in Lakhs)

117


towards claims has been made. The net impact on the provision for the current year

is withdrawal of Rs. 3195.69 lacs. Total year-end Provision for Doubtful Debts as at

31st March 2011 stands at Rs.12217.18 lacs (Previous year Rs.15412.87 lacs).

c) Ministry of Power, Government of India had advised Madhya Pradesh Power

Geeration Corporation Ltd. (MPPGCL) to securitise outstanding principal and interest

up-to 30.09.2001 of Rs.17194 lacs and Rs. 2199 lacs respectively. MPPGCL had

securitised Rs.12391 lacs in 2003 leaving balance of Rs. 7002 lacs still unsecuritised

details of which are as under :

d) Liability not acknowledged as debts in respect of claims from customers pending

arbitration/settlement and/or final award for which Company is contingently liable

amounts to Rs.2408 Lacs (Previous year Rs.2408 lacs).

e) As per interim orders dated 20.06.2005 and 29.06.2005 of Nagpur Bench of Hon'ble

Bombay High Court, WCL has made Fixed Deposit in Nationalised Banks for the

amount of difference between weighted average of e-auction price and notified price

for coal supplied to the petitioners during the period 01.07.2005 to 31.12.2005. On

12.12.2005, Hon'ble Supreme Court directed to supply coal to petitioners on payment

of notified price plus 33.33% of enhanced price and by furnishing security for

the balance amount of 66.67% of enhanced price with an undertaking to the Hon'ble

Supreme Court that the said part will also be paid within 6 weeks of the decision of

the apex court in the Writ Petitions in case the Writ Petitions are decided against the

Petitioners. However, the petitioners voluntarily deposited with WCL the full value of

coal, i.e., notified price plus full difference between weighted average price and noti

fied price along with a letter of undertaking. The total amount so deposited by the

Customers till 31.03.2007 was Rs.3978 lacs, which was shown under “Advances and

Deposits from Customers”. An equivalent amount of Rs.3978 lacs was deposited with

Nationalised Banks in Fixed Deposit a/c by the Company. The interest earned on the

Fixed Deposits was treated as a current liability to be adjusted against the actual

interest as and when paid to the customers.

As per the directive of Supreme Court an amount of Rs.404 lakhs was to be deposited

with the Court and the Company has paid this amount to Coal India Ltd. for depositing

with the Court. This amount is shown as advance deposit in our books.

As per the Supreme Court order dated 9th May, 2008, refund claims of the customers

are to be verified by a Committee at WCL HQ level and the money is to be refunded

to the claimants directly. Accordingly an amount of Rs.2297.94 lakhs (CY Rs. 8.94 lakhs)

together with interest of Rs.410.80 lakhs (CY Rs. 1.80 lakhs) has been refunded to the

claimants. The total refunds and interest paid till 31.3.2011 (including the above

refund and interest) are Rs.3926.81 lakhs and Rs.759.58 lakhs respectively.

Particulars Principal Interest Total

Amount Securitised 10986 1405 12391

Amount not Securitised 6208 794 7002

Total 17194 2199 19393

Rs. in Lakhs

118


Considering the refunds made to the customers and the amount paid to CIL, there is

no Fixed Deposit on this account as on 31st March 2011.

f) The government of Madhya Pradesh by Gazette Notification dated 30/09/2005 has

imposed a new tax named “ Madhya Pradesh Gramin Avsanrachana Tatha Sadak

Vikas Adhiniyam, 2005 (MPGATSVA 2005), with effect from 30/09/2005. This

Adhiniyam provides for charging of tax @ 5% on annual value w.e.f. 30.09.2005.

Some consumers as well as WCL moved the Hon'ble High Court of Madhya Pradesh,

Jabalpur and obtained interim relief. As per the interim order dated 15/02/2006 the

Hon'ble High Court, Jabalpur had directed the Compay not to deposit this tax to the

State Government but to keep in a fixed deposit. The matter was later dismissed by

the Jabalpur High Court in favour of MP Government. WCL has filed an SLP before

the Hon'ble Supreme Court and the matter is still sub judice. The Hon'ble Supreme

Court of India vide its order dated 02-08-2010 directed the Company to file its returns

for all the years under protest as per MPGATSVA (2005). The Hon'ble Supreme

Court directed the assessing officer under the Act to complete the assessments of

returns filed by the Company. In compliance with the Supreme Court directions the

assessing officers raised total demand of Rs.20579.35 lacs against the Company in

the year 2010-11. The Company, as per legal advise, has deposited Rs.10289.68 lacs

(being 50% of the total demand) and has preferred Appeals against the assessment

orders with Competent Appellate Authority, Jabalpur and Bhopal. The appeal for

Patherkhera Area has been decided against the Company and as per legal advise,

balance 50% amount of Patherkheda Area amounting to Rs.4262.17 lacs has also

been deposited ,making the total deposit of Rs.14551.85 lacs.

An amount of Rs.24550.22 lakhs. has been received from customers on this account

upto 31/03/11 . Term Deposit, against this receipt upto 31st March 2011 (after adjusting

Rs.14551.85 lacs paid for appeal), for Rs.9471.01 has been made upto 31st March 2011

and Term Deposit for balance Rs. 527.36 lakhs will be made in April 2011. Areawise

liability of Rs.9998.37 lacs are as appearing in Annexure at S. No. 4 (b). The matter is

now pending before the Hon'ble Supreme Court and Appellate Authority Jabalpur .

The interest on fixed deposits made on this account is treated as liability.

g) Interest on delayed payments from SEBs as per FSA are being accounted for on

receipt basis. During the year interest amounting to Rs. 2946.82 has been received

and accounted for (Previous year Rs. Nil lacs)

h) As per the Coal Supply Agreement on Cost Plus basis between the Company and

MAHAGENCO for supplies from Adasa UG mines of Nagpur Area, Clause 7.4 pro

vides for a discount in price of 30% of the contracted price if the coal supply exceeds

the contracted quantity. Accordingly, during the year Nagpur Area has made a

provision of Rs.581.91 lacs (P.Y. Rs. 596.34 lacs).

i) During the year, as per terms of FSA with consumers, Performance Incentive Bills

(PIBs) amounting to Rs. 1925.50 lacs have been raised for the coal lifted against

Annual Contracted Quantity (ACQ) of 2009-10, a part of which was lifted during 2010-11.

PIBs amounting to Rs.4713.35 in respect of all qualifying customers for the year

2010-11 for coal lifted during the year up-to 31.03.2011 have also been accounted for .

119


j) During the year Metal Scrap Trading Corporation (MSTC) and Mjunction conducted

e-auction. During the year 57 e-auctions (including 10 forward e-auctions) were con

ducted for Rail and Road mode.

8. LOANS & ADVANCES:

a) The advances to suppliers/contractors and for capital works/mobilisation advances

lying unadjusted since long are Rs. 280.83 lacs as per Annexure S.No.3(a) to 3(b)

(Previous year Rs.252.96 lacs).

b) The Company had approached MSRDC to construct a bridge over Wardha River

near Nakoda in Wani Area to reduce the lead for coal transportation between the

mines of Wani Area and Railway Siding at Wani. An agreement was entered into with

MSRDC on 23.12.1997 for construction of the bridge and a loan of Rs. 235 lacs was to

be given by WCL to MSRDC, against which a loan of Rs.113 lacs, carrying a simple

interest @ 9% p.a. was given to MSRDC in 1997-98. The bridge is currently being

used to transport coal across Wardha River. The loan is to be repaid by MSRDC

after repayment of its other loans. However, till date no amount is repaid by MSRDC.

The remaining amount of loan of Rs.122.00 lacs has not been released as WCL wants

to establish a time bound schedule for repayment of the loan and interest thereon.

Negotiations have been initiated with MSRDC for this purpose.

Since the principal amount of advance is doubtful, necessary provision for Rs.214.25

lacs (including interest accounted for as income upto 31.3.2010 of Rs.101.25 lacs.)

existed as on 31.03.2010. In view of this, during the year 2010-11, the interest amount

ing to Rs.10.17 lacs on this advance has not been recognised as income and also no

further provision was necessary during the year.

c) Loans and Advances, Sundry Creditors and Sundry Debtors are subject to confirmation.

d) Bharat Gold Mines Ltd,.(BGML) has lodged a claim on Umrer Area for payment of

escalations and dewatering charges amounting to Rs.70.11 lakhs in a contract work at

its Murpar U/G Mines. BGML has to comply with some requirements pending which

no additional provision is considered necessary in the accounts. However, this has

been shown as “Contingent Liability”.

e) Some of the employees transferred from other areas/Companies of CIL had taken

advance in their parent areas/Companies and such advances have not been trans-

ferred to the respective areas to which they have later been transferred. Conse-

quently, in some areas advances accounts are showing credit balances due to

recoveries. This is under reconciliation and necessary adjustment.

9. CURRENT LIABILITIES & PROVISIONS:

a) Pending decision of Hon'ble Supreme Court of India Rs.452.07 lacs being interest on

delayed payments on account of enhancement of rate of royalty on coal, collected

from customers in the earlier years, continued to appear in account 'Advance & De-

posits from Customers under the head 'Current Liabilities & Provisions' (Previous

year Rs. 452.07 lacs).

b) Central Excise Department had been issuing Show Cause Notice over the years

120


with regard to CWS, Tadali, considering the Workshop as under Factories Act

instead of Mines Act where eligibility exists for exemption. In this regard an appeal

before the Hon'ble Supreme Court of India (C.A. No.8403-04/2003) was decided in

favour of the Company. The balance refund of Rs.5.38 lacs is pending clearance of

CESTAT though necessary COD permission has been obtained and the appeals

before CESTAT revived during the previous year.

c) By virtue of enactment of Cess and Other Taxes on Mineral Validation Act, 1992, the

Company raised supplementary bills on customers' upto 04.04.1991. An amount of

Rs.295.66 lacs (Previous Year Rs.295.66 lacs) has been shown as liability for Cess

on Royalty under the head Current Liabilities & Provisions. In view of the judgment of

Hon'ble High Court, Patna, Ranchi Bench in writ petition no.CWJC/1280

of 1992, Cess is not payable. However a Special Leave Petition is pending in

Supreme Court against it. Area-wise figures are as in Annexure at S.No. 4(a).

d) Sundry Creditors to the tune of Rs.90.25 lacs (Previous year Rs.181.02 lacs) remain

unadjusted for more than three years pending reconciliation. Area-wise figures are

as in Annexure at S.No. 4(d).

e) Outstanding capital liability for civil works / Plant & Machinery completed in different

Areas include an amount of Rs.71.48 lacs (Previous year Rs.292.49 lacs) outstanding for

more than three years. Area-wise figures are as in Annexure at S.No.4(c).

f) The provision for Income Tax for the year Rs. 44790.14 Lacs (Previous Year: Rs. 31736.77

lacs) has been worked out as per the provisions of the Income Tax Act 1961 and on

the basis of completed assessments of the Company. Additional provision for

Income Tax of earlier years amounting to Rs.11138.50 lacs (including short provision

of Rs.10216.76 lacs of F.Y. 2009-10) has been made during the year (Previous year

withdrawal of Rs.4156.08 lacs).

g) During the year 1995-96, a theft case at CWS Stores was suspected and police

complaint was lodged. A department enquiry is also under progress. During the

course of such enquiry many kardex were seized/taken out of investigation. Pending

final outcome of the enquiry, the workshop continues to maintain a provision of

Rs.14.10 lacs.

h) During the year recovery of electricity charges @ 1% of basic pay has been made

from the salary/wages of non-executive employees. This recovery has been

challenged by the employees before the Calcutta High Court and as per the directives

of the Court, the amount so recovered has been deposited with the State Bank of

India, Nagpur. As per directives of CIL and pending settlement with the employees

the same has been kept separate under FC 470120 to the tune of Rs.1529.40 lacs

[Area-wise figures are as in Annexure at S.No 5(b)]. During the year this deposit has

earned an interest of Rs. 79.78 lacs and the same is treated as liability. There is a

contingent liability against the Company to the extent of interest, if any, awarded by

the Court on final disposal of the case. However, the quantum of interest is unascertainable.

i) The provision for Performance Related Pay for Executives has been made at

Rs. 7395 lacs (previous year Rs.14621.91 lakhs for the years 2007-08 to 2009-10) in line

with the recommendation of the Committee formed by CIL to evaluate the liability.

The area-wise figures are as in Annexure at S.No.5(f).

121


j) Deductions made from employees' remuneration in 1996-97 towards Union Fund

(Rs.78.35 lacs) and Relief Fund (Rs.39.94 lacs) continue to be kept in separate

deposit accounts as the matter is sub-judice. The interest earned on these deposits

upto 31st March, 2011 is Rs.138.05 lacs (C.Y 23.19 lacs) and Rs.66.67 lacs

(C.Y. 16.14 lacs) respectively. The deduction together with the interest is appearing

under the head Current Liability.

k) Report of the Tripartite Committee, comprising of Subsidiary/Mine Management,

CMPDIL and Explosive Manufacturers, set up to finalise the benchmark powder factor

of each mine for the period 2005-06 and April'06 to July'06, is still awaited. It has

been decided by CIL that Subsidiary Management shall review the impact of considering

the powder factor of 2003-04 and 2004-05, whichever is higher vis-à-vis actual

achieved during 2005-06 and submit the Company's view through CMD to CIL. This

review is yet to be finalized. As such no recovery has been made from bills for

supply of explosives during that period. Pending finalization of the issue, the Bank

Guarantees submitted by the suppliers is not released by CIL. Subsequent supplies

are covered by new rate contracts which specify that recovery on account of powder

factor is to be adjusted after final powder factor reports are received from the Areas

on quarterly basis. Pending receipt of final reports for quarter ending March '11 the

deduction of Rs. 100.79 lacs made during current year is appearing as a liability. Ac

cordingly, the expenditure on account of explosive consumption has not been ad

justed since the amount is unascertainable.

l) In case of Land in Chandrapur/Ballarpur/Wani/Nagpur Areas, a common judgment

was pronounced on 05.01.2009 by the Hon'ble Bombay High Court in Non-Agricultural

assessment cases. Accordingly, there is a contingent demand of Land Revenue,

ZP/GP Taxes and Additional Taxes for the period from 1980 to 2009 to the tune of

Rs. 6204.11 Lacs. However, the Company has filed a Leave Petition before the

Divisional Bench of Hon'ble Bombay High Court, on behalf of the Areas on the

grounds that such taxes are not payable on lands acquired under Coal Bearing Area Act.

m) As per instructions from CIL, provision has been created for Pension payable to

employees @ 3% of pay (Basic + DA) and @ 6.84% of pay for other Superannuation

Benefits amounting to Rs. 1763.34 lacs (previous year Rs. 4367.17 lacs for the

period from 01.01.2007 to 31.03.2010). Area-wise figures are as in Annexure S.No.4(f).

n) The provision for Performance Linked Reward Scheme / Productivity Linked Bonus

Scheme for non-executives for the year 2010-11 @ Rs.15,000/- per employee has

been made at Rs. 8583.78 Lakhs. The area-wise figures are as in Annexure at

S.No. 4(g).

o) The Rate Contracts (RC) for supply of explosives by different suppliers expired on

28th February, 2006 and pending renewal of the RCs the suppliers were asked to

continue the supplies at the same rates as prevalent in the expired RC, subject to the

condition that such extended period supplies would be governed by the rates as

fixed in the new RC. This continued upto 28th July, 2006.

The new RC was finalised and came into effect from 29th July, 2006 with a reduced

price of the explosives. As a result, the supplies during the extended period of the

earlier RC was found to be supplied at a higher price than actually applicable. Hence

recovery of excess amount paid was made from the suppliers.

122


Against the above recoveries, some of the suppliers, (six parties) filed a Civil Suit

before Hon'ble Calcutta High Court. The Hon'ble High Court of Calcutta granted stay

in December 2006 for recovery and directed CIL to stop such recovery of excess

payments. Accordingly CIL directed WCL to refund the amount deducted from the

six suppliers. The Hon'ble High Court of Calcutta asked these suppliers to deposit

the disputed amount in question in an account with the Joint Receiver appointed by

the Hon'ble High Court. As the suppliers having failed to do so, the Hon'ble Calcutta

High Court in July 2008 vacated the stay of recovery of excess payment made to

such suppliers. Hence, CIL directed WCL to restart the recovery of such amount

from the running bills of the suppliers as per directives of Court. An amount of

Rs. 253.77 lacs is recovered and kept in the books under a separate account

(Liability Code 480199) since 2008-09, pending final disposal of the case by the Court.

10. COMPLIANCE WITH MANDATORY ACCOUNTING STANDARDS:

a) Prior period adjustments under AS-5 :

The expenses pertaining to previous years amounting to less than Rs. 5 lacs has been

charged in current year which deviates from AS-5. The impact of this on the profit of

the Company for the year is reduction in profit to the tune of Rs. 1.96 Lacs. Area-wise

figures are as in Annexure at S.No.5 (e).

b) Employee Benefits under AS-15 :

The Company has adopted AS 15 (Revised) - Employee benefits with effect from

1st April, 2007. Pursuant to the same, the Company has adjusted the additional

liability arising on adoption of AS-15 (Revised), net of related deferred tax assets

arising out of such adoption as on 1st April, 2007 against the General Reserves.

(1) Short term employee benefits: The Company recognises the undiscounted amount

of short term employee benefits expected to be paid in exchange for services

redered as a liability (accrued expense) after deducting any amount already paid.

(2) Post-employment benefits: the company operates defined contribution plans

pertaining to Coal Mines Provident Fund schemes for all employees.

(3) Other long-term employee benefits : Entitlements to annual leave and sick leave

are recognised when they accrue to employees. Sick Leave can only be availed

during service period while annual leave can either be availed or encashed

subject to leave rules of the Company. The Company determines the liability

for such accumulated leaves using the Projected Accrued Benefits Method with

actuarial valuations being carried out at each Balance Sheet date.

(4) Terminal benefits : VRS benefits are recognized in the books in the year of

occurrence.

123


(Rs. in Lakhs)

* The total charge on account of Gratuity to P&L A/c during the year is Rs. 8086.80 lacs

against the charge towards Fund of Rs. 8412.96 lacs. The difference of Rs. 326.16 lacs

is towards adjustment of excess Gratuity provision on pay revision and other unpaid gratuity

for employees superannuated prior to 10.03.2003 (the date of creation of the Fund).

** The annual Life Cover premium for the period from March, 2011 to February, 2012 is

Rs. 690.84 lacs, out of which Rs. 57.57 lacs is charged to Current Year expenses and

balance of Rs. 633.27 lacs is booked to Prepaid Expenses. Considering the prepaid

premium of 2009-10 to the tune of Rs.607.78 lacs the total premium for the current year is

Rs. 665.35 Lacs.

The incremental liability based on actuarial valuation for provision for Retired Employees

Medical Benefit of Rs. 206.01 lacs has been accounted for at HQ.

The following disclosures are made in accordance with AS-15 (Revised) pertaining to the

Gratuity (Funded Plan) :

Changes in Present Value of Obligations

As at

31.03.2008

As at

31.03.2009

As at

31.03.2010

As at

31.03.2011

Present Value of Obligation at beginning of the year

65435.44 78148.51 129154.11 149217.52

Interest Cost 5288.56 6251.88 9782.11 11930.45

Current Service Cost 3681.13 5521.12 6076.24 6017.01 Benefits paid 6434.18 10118.86 13755.43 17718.52 Actuarial gain/loss on obligations 10177.56 -49351.47 17960.48 4056.17

Present value of Obligation at end of the year

78148.51 129154.11 149217.52 153502.63

(Rs. in Lakhs)

GRATUITY

(FUNDED)

L EAVE

ENCASHMENT

(UNFUNDED)

LLTC/LTA/ LIFE

C OVER /SETTLE- M ENT

ALL ./M EDICAL /FATAL

ACCIDENT COMP. &

ACCIDENTA L

INS.(UNFUNDED)

Actuarial Valuation as on 31.03.2011

153502.63 25355.34 6987.79

Actuarial Valuation as on 31.03.2010

149217.52 19145.27 5566.58

Net Incremental Liability for C.Y. 4285.11 6210.07 1421.21

Add : Reduction in Fund due to disbursement during C.Y.

17718.52

Less : Addition to Fund by Interest earned in C.Y.

13590.32

Net Payment in C.Y. *16094.54

Premium for Life Cover for C.Y. **57.57

124


As at

31.03.2008

As at

31.03.2009

As at

31.03.2010

As at

31.03.2011

Fair Value of Plan Asset at beginning of the year

65648.21 72656.30 95150.80 140623.32

Expected Return on Plan Asset 5251.86 5812.50 7612.06 11249.87

Contributions 6787.45 25313.44 38896.59 16094.55 Benefits paid 6434.18 10118.86 13755.43

17718.52

Actuarial gain/loss on Plan Asset 1402.96 1483.10 12719.29 2340.46 Fair Value of Plan Asset at end of year 72656.29 95146.49 140623.32 152589.67

As at

31.03.2008

As at

31.03.2009

As at

31.03.2010

As at 31.03.2011

Present value of obligation at end of the year

78148.51 129154.11 149217.52 153502.63

Fair Value of Plan Asset at end of the year

72656.29 95146.49 140623.32 152589.67

Funded Status -5492.21 -34007.62 -8594.20 -912.97

Unrecognised actuarial gain/loss at end of the year

0.00 0.00 0.00 0.00

Net Asset (Liability) recognized in Balance Sheet

-5492.21 -34007.62 -8594.20 -912.97

As at

31.03.2008

As at

31.03.2009

As at

31.03.2010

As at

31.03.2011

Opening Net LIability -212.77 -62523.04 0.00 8594.20

Expenses as above 12492.43 53828.86 4593.59 8413.31 Contributions 6787.45 25313.44 0.00 16094.55 Closing Net Liability 5492.21 -34007.62 4593.59 912.97

Closing Fund/Provision at end of year 78148.51 129154.11 19145.27 153502.63

As at

31.03.2008

As at

31.03.2009

As at

31.03.2010

As at

31.03.2011

Current Service Cost 3681.13 5521.12 6076.24 6017.01

Interest Cost 5288.56 6251.88 9782.11 11930.45 Expected Return on Plan Asset 5251.86 5812.50 7612.06 11249.87 Actuarial gain/loss recognized in the year

8774.60 47868.36 5241.19 1715.72

Expense recognized in Statement of Profit/Loss

12492.43 53828.86 13487.48 8413.31

Discount rate 8.50%

Inflation rate 6.00% Mortality rate LICI 1994 - 96 Attrition rate 10 per thousand p. a.

Formula used Projected Unit Credit Method

Changes in Fair Value of Plan Assets

Funded Status

Movements in Liability recognised in Balance Sheet

Expense recognized in Statement of Profit/Loss

Summary of Actuarial Assumptions

The provision made during the year for pension and superannuation benefit of employees has

not been done on the basis of actuarial valuation.

(Rs. in Lakhs)

(Rs. in Lakhs)

(Rs. in Lakhs)

(Rs. in Lakhs)

As at

31.03.2011

125


c) Segment Reporting under AS-17 :

The Company has two business segments, viz. Collieries and Washery. Since the rev

enue/ profit/assets of the Washery is less than 10% of the total revenue/profit/assets of

the Company, the Washery is not a reportable segment under AS-17. The operations of

the Company are confined to Central India, hence no geographical segments are identified.

d) Related Party Disclosure as required under AS-18 :

(i) Functional Directors

ii) Related Party transaction: ( Rs. in Lacs)

2010-11 2009-10

i) Remuneration:

Gross Salary 82.67 67.80

Employer's contribution to PF 7.81 6.10

Gratuity - 10.00

Leave Encashment on retirement 0.00 11.11

ii) Medical Reimbursement 0.46 3.05

iii) Sitting fees paid to Independent Directors 2.20 2.18

iv) Year-end balance of Advances: 1.50 1.12

During the year the Directors of the Company were paid a total salary of Rs. 93.14 lacs

(Previous Year Rs. 100.24 lacs) including Company's contribution to PF and Medical Ben

efits. This, however, does not include the provisions for contribution to Gratuity, Leave

encashment and other employee benefits, which are made on the basis of actuarial valuation,

done on an overall Company basis.

In view of the exemption granted to State controlled enterprises as regards related party

relationship with other State controlled enterprises and there being no transaction with

other related enterprises & parties, no disclosure under the Accounting Standard (AS-18)

on Related Party Disclosures is made, being not applicable for the Company.

Sl. Name of Director Designation

1 Sri D.C. Garg CMD

2 Shri O.P. Miglani DIRECTOR (PERS.)

3 Shri B.K. Saxena DIRECTOR (TECH)-O

4 Shri Om Prakash DIRECTOR (TECH)-P&P

5 Sri Sushil Behl DIRECTOR (FINANCE)

126


e) Disclosure of Earning per Share as required under AS-20 :

f) Accounting for Taxes on Income under AS-22

The deferred tax asset as required under AS-22 comprises of the following:

Deferred Tax Assets/Liability

g) Consequent to mandatory provisions of AS-24 relating to Discontinuing Operations

- w.e.f. 01.04.2004, the following disclosures are made:

i) CBE Plant, Bhandara : The Plant used to manufacture Nitro-Glycerine based

Permitted Explosives used in the underground mines of the Company till its closure

on 28.04.2003. Consequent upon decision of the Government of India to discontinue/

ban production of NG-based explosives in the country and its adoption by the Board

Deferred Tax

Asset/Liability as

on 31.03.2011

Deferred Tax

Asset/Liability as

on 31.03.2010

A Deferred Tax Liabilities

Difference between Book & Tax Depreciation 5915.21 2047.81

B Deferred Tax Assets

VRS 185.74 461.92 Statutory Dues 291.83 358.95

Provision for Doubtful Debts 4058.24 5238.83 Provision for Doubtful Advances 183.36 176.66 Provision for Leave Encashment 8422.41 6507.48

Provision for Obsolescence/ workshop wip 496.57 398.16 Provision for Claims 200.39 205.72 Provision for Shortage of Stores 50.47 50.32

Land Reclamation Provision 8739.54 5461.95 Disallowance u/s 40(a) of I.Tax Act 489.16 274.24 PLRS / PLBS & PRP 10154.80 6956.33

MP Gramin Tax 3321.21 6137.97 Provision for Pension & superannuation 2012.85 0.00 Other Actuarial Liabilities 1115.91 975.52

Fatal Mine Accident Benefit 1059.43 846.91 Retirement Medical Benefit 145.83 46.81 TOTAL 40927.74 34097.77

Deferred Tax Assets (net) (B-A) 35012.53 32049.96

(Rs. in Lakhs)

Particulars Current Year Previous Year

i) Profit After Tax ( Rs. Lacs) 53830.49 64560.99

Less : Preference Dividend 0.00 0.00

Profit attributable to Ordinary Shareholders

(Rs. Lacs)

53830.49 64560.99

ii) No. of Ordinary Shares (in Nos.) for basic and

diluted EPS

29,71,000 29,71,000

iii) Nominal value of Ordinary Shares Rs. 1000 Rs. 1000.00

iv) Basic & Diluted Earning per Ordinary Share Rs. 1811.86 Rs. 2173.04

127


of Ordnance Factories of India, the Jt. Venture partner of the Plant, the Plant was

closed on and from 28.04.2003.

CIL had given its approval for disposal of the Plant and the Company in its 197th

Board Meeting held on 19.04.2006 had approved the disposal of P&M by tendering /

e-auction and accordingly the P&M along with related stores & spares have been

disposed of during 2006-07 by auction through MSTC. The Net Block of assets

pending disposal is Rs. 8.14 lacs. The liability towards Overheads after closure of

the Plant till 31.03.2011 for maintenance and upkeep of the Plant is Rs. 39.56 lacs.

The revenue expenses incurred during the current year is Rs. NIL (Previous Year

Rs. 3.64 lacs) Since the Plant works on No-Profit-No-Loss basis, all expenses are

passed on to the Areas. Hence there is no question of profit/loss. There is a NIL

cash outflow attributable to operating, investing and financing of discontinuance

(Previous Year Rs. 0.19 lacs)

ii) DFD Plant, Hinganghat : The Plant used to manufacture Coal Briquettes from raw

coal for domestic fuel purposes till its closure in 1994. Consequent upon non-viability

of the Plant as per the decision of the Board of the Company, the Plant was closed in 1994.

The disposal of the Plant is under process and the exact date of completion of

discontinuance is not determinable as of now. The Net Block of assets pending

disposal is Rs. 2.57 lacs and the liability towards Municipal Taxes is Rs. 3.39 lakhs.

The Company has applied to the Hinganghat Nagar Palika for waival of the Municipal

Taxes for the past four years on the ground that the Plant is no more in operation. The

revenue expenses incurred during the current year is Rs.0.52 lakh (Previous Year

Rs. 0.52 lakh). Since the Plant is inoperative for the past ten years and the final disposal

of the Plant is yet to be done, there is no profit/loss. There is no cash outflow

attributable to operating, investing and financing of discontinuance.

h) Impairment of Assets : AS-28 :

The Company assesses at each balance sheet date the impairment of assets if there is

existence of any of the six external and internal indications prescribed.

In case of Land and Building, there is universally upward trend in Valuation. Unless,there

is damage to building, there is no need to make any provision. Similarly, in case of Plant

and Machinery and HEMM there is no downward trend, hence there is no impairment

unless Asset is obsolete or damaged.

Therefore, only prospecting & Boring and Development Expenses in continuous loss

making mines, have been considered for impairment, provided there is no clear indication

for its revival in near future.

In Umrer Area, at Umrer OC Mine there was an overburden-bench-sliding in the early

hours of 28th September, 2010 causing inflow of Amb River water into the mine. This has

caused an abnormal loss to the equipments and causing expenditure for additional activi

ties in Umrer Area due to heavy land slide in eastern quarry of Umrer OC.

A Drill Machine is completely buried under the landslide and the equipment is not

visible. CMPDIL, Nagpur has been engaged to locate the equipment for recovery and

the recovery process is in full progress. An amount of Rs. 94.45 lacs has been

128


charged to Profit & Loss Account during the current year being the impairment loss

and the WDV of the equipment as on 31st March 2011 has been kept at 5% of its cost .

During the Current Year an amount of Rs. 528.72 lacs (including Rs. 94.45 lacs

mentioned above) has been charged to Profit & Loss Account as impairment loss

against P & B and Development Expenditure (DE) and Plant & Machinery in the

current year (P.Y. Rs. 448.41 lacs) Area-wise figures are as in Annexure at S.No 1(d)

i) Provisions, Contingent Liabilities and Contingent Assets AS-29

As per directives of Coal India Ltd. provision for Mine Closure in the books is made

from current year on the basis of guidelines of Ministry of Coal circulated vide letter

no. 55011/1/2009 - CPAM dated 27.08.09.

Pending formulation of Final Mine Closure Plan, provision is made considering the

land area as per Environment Clearance / Environment Monitoring Plan for all existing

mines in operation. The provision amount has been computed @ Rs. 6.00 lakhs per

hectare for Opencast mines, and @ Rs. 1.00 lakh per hectare for Underground mines

allocated over the remaining life of the existing mines . During the year an amount of

Rs. 26310.04 lakhs has been made on this account. Area-wise figures are appearing

in Annexure at S.No.5(c).

The provision already made in the books during earlier years to the tune of Rs.16069.28

Lakhs under this head stands withdrawn during the year. Area-wise figures are ap

pearing in Annexure at S.No.5(d).

A further provision of Rs. 1457.69 lacs has also been made towards estimated expenditure

to be incurred to bring back Umrer OC Mine into operational activities for production

of Coal and Over Burden Removal.

Major provisions made in the accounts of the year (not covered in other AS)

are as below :

11. CONSISTENT METHOD OF ACCOUNTING :

As per consistent policy of the Company, the following methods of accounting continue to

be in vogue:

a) Accrual basis of accounting has been followed except in the following cases:

i. Liquidated damages, interest on delayed payment and escalation claims from

Customers on the basis of final settlement.

Nature of Provision Opening

Balance

Additions

during the year

Used/Written off

during the year

Closing

Balance

Bad Debts 15412.87 524.08 3719.77 12217.18

Wage Revision - NCWA-VIII 44936.40 0.00 44936.40 0.00

Executive Pay Revision 11440.21 0.00 11440.21 0.00

Executive PRP 14621.91 7395.00 0.00 22016.91

Executive Pen.& s/a benefits 4367.17 1763.34 0.00 6130.51

( Rs. in Lacs)

129


ii. Insurance/Railway claims on admission/final settlement.

iii. Scraps are accounted for on realisation.

iv. Refund/adjustment consequent to assessment of tax from Tax authorities excepting

Input Tax Credit claim of VAT are accounted for on cash basis. Additional demand of

Income Tax, Royalty, Cess, Sales Tax, Entry Tax, etc. are accounted for after final

order in appeals, pending such appeal payment made against additional demand are

treated as Advance/Claims.

b) Revenue Recognition: Sales

Bonus claims on customers, as a result of Joint Sampling are accounted for in

sales in the year of settlement irrespective of period of dispatch. Credit Sales are

recognised based on date of D-Note (Forwarding Note to Railways) and Cash Sales

are recognised upto despatches as of 24:00 hrs. on 31st March.

c) Fixed Assets:

i) Buildings include roads and culverts situated in colliery and townships as well as

cost of electrical fittings, water supply arrangements and sanitary fittings.

ii) Plant and Machinery are shown net of Input Tax Credit claim of VAT, wherever applicable.

iii) Cost of Asset as well as provision for depreciation on surveyed off Assets are taken

out of the Gross Block and provision for depreciation respectively and the residual

value at 5% of Book Value are shown as a separate item under Schedule of Fixed

Assets. In case of premature survey off of assets the difference between the WDV

and residual value of 5% is charged to Profit & Loss A/c, as loss on survey off of assets.

d) Stock of Stores & Spares: Stock of Medicines , sand and stationery and stock in Press

are not valued and the expenses on these accounts are charged to revenue.

e) Investments : The Bonds received on Securitization of dues from State Electricity

Boards, from the State Governments of Maharashtra & Madhya Pradesh with a lock-

in-period of five years are treated as long term investments and are valued at cost

unless there is a permanent diminution in the value of investment.

f) Foreign Currency Transactions:

i. Foreign exchange differences arising on accrual/repayment of liabilities incurred for

the purpose of acquisition of fixed assets are adjusted in the reported currencies by

applying the closing rates.

ii. Foreign exchange fluctuations are accounted in the reported currencies by applying

the closing rates. The effects of change in foreign exchange rate in respect of trans-

actions in foreign currencies before the Revised AS-11 came into effect is taken as

per pre-revised AS-11.

g) Taxes on Income: Current tax is the amount of tax payable on the taxable income

for the year as determined in accordance with the provisions of the Income-tax Act,

1961. Deferred tax is recognized on timing differences, being the difference between

taxable income and accounting income that originate in one period and are capable of

reversal in one or more subsequent periods.

130


h) Own consumption of coal is valued at basic price of declared grade of coal of the

related mines.

i ) Subsidy for sand stowing and protective works is received from Coal Controller's

Organisation on half-yearly basis. The amount of subsidy actually received for Half

Year Ending 30th September 2010 is Rs. 712.94 lacs. The subsidy receivable for the

Half Year Ending 31st March 2011 is estimated and accounted for on the same basis

as was made for the Half Year Ended 31st March 2010, and the amount so receiv

able is estimated at Rs. 642.32 lacs (Previous year Rs. 626.69 lacs)

12. CHANGES IN ACCOUNTING POLICY

a) Weighted Average Notified Price for computing Net realisable Value for valuation of

closing Stock of Coal:

Consequent to the coal price revision w.e.f. 27th February, 2011, two types of

Notified Prices have come into effect as below :

i) For Power Utilities (including IPP), Fertiliser and Defence consumers.

ii) For consumers other than (i) above.

Accordingly, for the purpose of computing Net Realisable Value for Closing Stock

valuation, a weighted average price of the two notified prices, based on proportionate

despatches to the two different groups of entities as mentioned in (i) & (ii) above

during the year 2010-11, has been adopted. The consequent additional impact on

coal stock valuation during the year is Rs. 207.66 lacs increase in profit.

b) Provision for Mine Closure Expenditure:

During the year 2010-11, as per directives of Coal India Ltd., a provision for Mine

Closure in the books is made from current year on the basis of guidelines of Ministry

of Coal circulated vide letter no.55011/1/2009 - CPAM dated 27.08.09 instead of

making provision for Technical reclamation and Biological reclamation done in earlier

years. This change in Accounting policy has resulted in additional provision of Rs.

10442.41 lacs.

13. OTHERS:

a) The Company had preferred appeals in cases of Income Tax and Sales Tax assess-

ments completed. Pending decision, no provision has been considered necessary

and the amount paid/recoverable is being continued to be kept under Loans and

Advances/Claims Receivables.

b) Production of Coal is derived from records of dispatches billed, internal consumption,

opening and closing stock and are further certified by CIL Team.

c) Balances of Sundry Debtors, Advance to Suppliers and Contractors, Sundry Credi-

tors and Advances from Customers and other accounts recoverable/payable are

subject to confirmation.

d) CIL has been levying additional Apex Charges @ Rs. 6.00 per ton of coal dispatch to

meet the rehabilitation & fire fighting expenses of Jharia and Raniganj areas of BCCL/

ECL. An amount of Rs. 2553.54 lacs (Previous year Rs. 2730 lacs) has been

charged to P&L A/c on this account. Area-wise figures are as appearing in Annexure at S.No.5(a).

131


e) During the year 1993-94 a suspected fraud case was detected at Nandgaon Incline

of Chandrapur Area, quantified by the Internal Audit Department to the tune of Rs. 11.54

lacs and the same is under CBI investigation. An amount of Rs. 2.25 lacs has been

recovered from the party and credited to income. For the balance of Rs. 9.29 lacs

the recoverable figure is matched with a similar provision.

f) Gross sales is shown in the accounts as net of levies like entry tax, transit fees,

MPGATSVA Tax, etc. levied in the state of Madhya Pradesh amounting to Rs. 4676.60

lacs, but is inclusive of other statutory levies like Royalty, Stowing Excise Duty,

Central Excise Duty, Clean Energy Cess, Sales Tax, etc. Such levies (other than

entry tax, transit fees and 5% M.P.G.A.T.S.V.A. Tax) are shown separately and

removed from gross sales to arrive at net sales. Sales includes Rs. 6638.85 lacs,

Performance Incentive Bills raised. Rs. 4713.35 lacs is for the supplies to SEBs in the

current year and Rs.1925.50 lacs for balance supplies for the year 2009-10 as per FSA.

g) Impact of e-auction and revision of Coal prices during the year are as follows:

The area-wise figures for both the impacts are as in Annexure at Sl.No.5(g) & (h).

h) In Pench Area at Sethia OC Mines, having a lead distance of 9.8 kms for levying

Surface Transportation Charges, STC is being charged @Rs. 50/- per tonne against

the permissible Rs. 30/- per tonne for the past several years. For want of details, the

impact of such excess levy of STC on the loss of the Area is unascertainable.

i) The interest paid/payable u/s 234(b) & ( c) of the Income Tax Act, 1961 is charged off

to Profit & Loss a/c under the head “Interest”. Accordingly, an amount of Rs. 372.22

lacs being interest for prior years and an amount of Rs. 93.18 lacs for 2010-11 has

been charged to current year.

j) Two new central levies have been introduced on coal from the current year, 2010-11.

Clean Energy Cess :

In the Finance Act, 2010 Clean Energy Cess was introduced w.e.f. 1st July

[email protected]/-per tonne on coal removed from Mines. It is administered by Central Excise

Department. This amount is collected from the customers and paid / payable to

Excise Authorities.

Central Excise Duty :

Coal was brought under the ambit of Central Excise Duty (CED) w.e.f. 0000 hours of

01.03.2011 under the Finance Act, 2011. Though there was an option to pay @ 1%

without CENVAT Credit or @ 5% with benefit of CENVAT Credit, as per directives of

Coal India Ltd., the option of 5% CED with CENVAT Credit was exercised by WCL.

Accordingly, sales billing was commenced from 01.03.2011 with a levy of 5% CED and

E-auction Price revision

( w.e.f 27.02.2011)

Impact on Gross Sales Rs. Lacs 57707.58 2036.69

Impact on Net Sales Rs. Lacs 52602.12 1777.89

Impact on Taxes / levies Rs. Lacs 5105.46 258.80

132


2% Education Cess and 1% Secondary/Higher Education Cess. This amount is collected

from the customers and paid / payable to Excise Authorities.

CENVAT Credit to the extent of Rs. 588.21 lakhs has been taken during the year against

CED for the period 1st March to 31st March 2011.

The element of CED included in the value of closing stock of coal as on 31st March 2011

is Rs. 2823.20 lakhs.

k) Amount due to Small Scale Industries amounting to more than Rs. 1.00 lac and out

standing for more than 30 days is Rs.53.25 lacs (Previous Year Rs. 103.88lacs) The

area-wise figures for both the impacts are as in Annexure at Sl.No.4(e).

The applicability of Micro, Small and Medium Enterprises Development Act, 2006

(MSMEDA, 2006) to the company for the purpose of disclosure and other require

ments, could not be ascertained pending information from the suppliers.

l) Since the Company has started submitting quarterly accounts in the current year,

the figures of profit & Loss account for comparable last quarter of the preceding

financial year could not be furnished . Previous year figures , wherever shown ,are

for the previous full financial year and are regrouped / rearranged wherever necessary .

m) Figures of previous year have been regrouped/rearranged wherever necessary.

n) Schedules A to J and 1 to 16, Significant Accounting Policies and Notes on

Accounts in Schedules 17 to 19 form integral part of these accounts.

M.SUBRAMANIAN RAMEHER SUSHIL BEHL D.C. GARG

General Manager (Fin) Company Secretary Director (Finance) Chairman-cum-Managing Director

(DIN-02841938) (DIN-00267658)


FOR C.R.SAGDEO & CO

Chartered Accountants

( FRN 108959W )

CA. DR. JAYANT M RANADE

PARTNER

M.No. 017852Place : Nagpur

Date : 21st May, 2011

`

WCL

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