liberty phosphate limited - coromandel · 23rd annual report 2010-11 liberty phosphate ltd. notice...

LIBERTY PHOSPHATE LIMITED

TWENTY THIRD ANNUAL REPORT 2010-2011

23rd Annual Report 2010-11 Liberty Phosphate Ltd.


ANNUAL REPORT 2010-11

CONTENTS

1 2 3 4 5 6 7 8 9

S. No.

Item

Board of Directors Notice Directors' Report Auditors' Report Balance Sheet as at 31st March, 2011. Profit & Loss Account for the year ended 31st March, 2011. Cash Flow Statement Schedules to Balance Sheet Schedules to Profit & Loss Account

Page No.

1 2 8

26 30 31 32 33 39

10 11 12 13 14 15 16 17 18

Notes on Accounts General Business Profile. Statement of Subsidiary u/s 212 Auditors' Report on Consolidated Financial Statements Consolidated Balance Sheet Consolidated Profit and Loss Account Consolidated Cash Flow Statement Schedules forming part of Consolidated Accounts Notes forming part of Consolidated Accounts Attendance Slip & Proxy Form

41 50 51 53 54 55 56 57 64


Mr. Abdul Razak Dawood Dhanani - Chairman Emeritus

BOARD OF DIRECTORS

1. Mr. Raoof Razak Dhanani - Chairman & Managing Director 2. Mr. Shakil Zakaria Memon - Whole time Director

3. Mr. Vinit J. Shah - Director (upto 13.04.2011)

4. Mr. Firoz Asgar Khambati - Director 5. Mr. Salim Abdul Aziz Sherani - Director 6. Mr. Abdul Mabood Shaikh - Whole time Director

7. Mr. Hemant Motilal Shah - Director 8. Mr. Zafar Ullah Khan - Whole time Director 9. Mr. Tuntun Singh - Whole time Director (upto 13.04.2011)

10. Mr. Ajay Paliwal - Additional Director (w.e.f. 23.03.2011)

Statutory Auditors V. Shah & Associates, Chartered Accountants 12, Dhayber Colony, Behind Baroda High School, Near Pologround, Baroda- 390 001. K. L. Vyas & Company, Chartered Accountants

Shop No.2, 2nd Floor, Parshwanath Dava Bazar, 6, Hazareshwar Colony, Udaipur- 313 001

Bankers Canara Bank, IDBI Bank Limited Karur Vysya Bank Limited, State Bank of Patiala

Works F-227, Mewar Industrial Area, Madri, Udaipur -313 003 (Rajasthan). 74/75/83, G.I.D.C., Nandesari-391 340

Dist.: Vadodara (Gujarat). 19, Bhimpura Industrial Area, Jagpura Kota (Rajasthan). Survey No. 122 & 129, Rasal, Tal. Sudhagad, Dist. Raigad ( Maharashtra). Registered Office 74/75, G.I.D.C., Nandesari-391 340 Distt. Vadodara (Gujarat) Company Secretary

Ms.Rehanuma Khan

1


NOTICE

NOTICE is hereby given that the Twenty Third Annual General Meeting of the Members of LIBERTY PHOSPHATE LIMITED will be held at the Registered Office of the Company at 74/75, GIDC, Nandesari -391 340, District- Vadodara on Wednesday, the 14th day of September, 2011, at 11.00 A.M. to transact the following business : ORDINARY BUSINESS :

(1)

(2) (3) (4)

(5)

(6)

To receive, consider and adopt the Audited Accounts of the Company for the year ended on 31.03.2011 along with the Report of the Directors' and Auditors' thereon. To declare dividend on 8% Cumulative Redeemable Preference Shares. To declare dividend on Equity Shares. To appoint a Director in place of Mr. Salim Abdul Aziz Sherani, who retires by rotation and being eligible,

offer himself for reappointment. To appoint a Director in place of Mr. Shakil Zakaria Memon, who retires by rotation and being eligible, offer himself for reappointment. To appoint Joint Statutory Auditors and fix their remuneration and in this regard, to consider and if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution:

"RESOLVED THAT the retiring Joint Statutory Auditors of the Company M/s.V. Shah & Associates,

Chartered Accountants, Vadodara (ICAI Registration No. FRN 109816W) and M/s. K. L. Vyas & Company, Chartered Accountants, Udaipur (ICAI Registration No. FRN 003289C), be and are hereby

appointed as Joint Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting of the Company on such remuneration as shall be fixed by the Board of Directors of the Company."

SPECIALBUSINESS:

(7)

To consider and, if thought fit, to pass with or without modification(s), the following resolution as an Ordinary Resolution:

"RESOLVED THAT Mr. Ajay Paliwal, who was appointed as an Additional Director of the Company by the Board of Directors in their meeting held on 23.03.2011 and in accordance with the provisions of Section 260 of the Companies Act, 1956, ceases to be a Director at the commencement of the ensuing Annual General Meeting and in respect of whom a notice under section 257 of the Companies Act, 1956

having been received from a member of the Company proposing his candidature to the office of the Director, be and is hereby appointed as a Director of the Company with immediate effect from today i.e. 14.09.2011 whose period of office is liable to be determined by retirement by rotation."

2


(8) (9)

To consider and, if thought fit to pass, with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of section 17 and all other applicable provisions, if any, of the Companies Act,1956, (including any statutory modification or re-enactment thereof for the time being in force) and as may be enacted from time to time and subject to such permissions, consents, confirmations, approvals as may be required, the Memorandum of Association of the Company be and

is hereby altered and extended by inserting the following sub-clause as new sub- clause- (s) immediately after the existing sub clause (r) of Clause III (C) - Other Objects of the Memorandum of Association of the Company : (s). To invest in and acquire, hold or otherwise deal in any shares, stocks, debentures, debenture stock, warrants, any other financial instruments, bonds obligations and securities issued or guaranteed by any company constituted or carrying on the business in India or elsewhere or Government, State Government, semi Government Authorities, local authorities, public Sector Undertakings, Financial Institutions,

Public Body, any other persons or otherwise and to carry on and undertake the business of finance, marketing loans or all kinds of purchasing, selling, hiring or letting/leasing on hire all kinds of plant and machinery and equipment and to assist in financing of all and every kind and description of hire purchase or deferred payment or similar transactions and to subsidise finance or assist in subsidising or

financing the sale and maintenance of any goods articles or commodities of all and every kind and description upon any terms whatsoever and to purchase or otherwise deal in all forms of immovable and movable property including land and buildings, plant and machinery, equipments, ships, aircrafts, automobiles, computers and all consumer, commercial, medical and industrial items and to lease or

otherwise deal with them including resale thereof, regardless of whether the property purchased and leased is now and/or used and from any part of the world."

To consider and, if thought fit to pass, with or without modification(s), the following resolution as a Special Resolution :

"RESOLVED THAT pursuant to Section 149 (2A) and all other applicable provisions, if any , of the

Companies Act,1956, approval of the Company be and is hereby accorded to the Board of Directors for commencing and undertaking all or any of the businesses specified in the newly introduced sub-clause (s ) of Clause IIIC of the Memorandum of Association of the Company as and when deemed fit by the Board of Directors upon the aforesaid sub-clause becoming effective."

(10) To consider and, if thought, fit to pass with or without modification(s) the following resolution as a

Special Resolution:

"RESOLVED THAT pursuant to the Section 149 (2A) and all other applicable provisions, if any , of the Companies Act,1956, approval of the Company be and is hereby accorded to the Board of Directors for

commencing and undertaking all or any of the businesses specified in the sub-clause (i) of Clause IIIC of the Memorandum of Association (as reproduced below) of the Company as and when deemed fit by the Board of Directors." "Hotels, Motels, Restaurants, Café, Guest Houses, tavern, refreshments rooms, boarding and lodging, house keepers, beer house keepers, licenced, victuallers, wine beer and spirit merchants, dealers in food stuff of all kind and varieties, brewers, maltsteres, inporters, exporters and manufacturers of aerated mineral and artificial waters and other drinks, surveyors, caterers to railways, air lines and steamship corporations and to public amusements, ice merchants, refrigerating store keepers,

proprietors of club, bath and dressing and to carry on the business of running night

3


clubs, swimming pools, backery, confectionery, canned goods, curios, carpets, novelty shops, general merchandise connected with hotel and restaurants trade and to provide lodging, boarding and other facilities to the public including tourist visitors and other delegates, missions coming from any part of the world and

to encourage and carry on and facilitate tourist trade in India and / or any other part of the world."

For Liberty Phosphate Ltd. Registered Office: 74/75,GIDC, Nandesari, District : Vadodara PIN - 391 340

Place : Mumbai. REHANUMA KHAN Dated : 29th July, 2011 Company Secretary

NOTES:

(1)

(2) (3) (4) (5)

(6)

(7)

A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and on a

poll to vote instead of himself and the proxy need not be a member of the Company. Proxies, in order to be effective, should be deposited at the Registered Office of the Company not less than 48 hours before the

commencement of the meeting. The Register of Members and Share Transfer Books of the Company in respect of Equity Shares shall remain

closed from 08.09.2011 to 14.09.2011 (both days inclusive ) for the purpose of payment of dividend and Annual General Meeting. Members are requested to bring their copies of Annual Report at the time of attending the Annual General Meeting. Any query related to accounts should be notified to the Company at least 7 days before the date of the Annual General Meeting. The Securities and Exchange Board of India has mandated compulsory trading of the Company's equity shares in demat form for all the investors. The International Securities Identification number (ISIN) code is

INE 639 D 01011. Members are hereby informed that dividend which remain unclaimed /unencashed over a period of 7 years

have to be transferred by the Company to the Investor Education and Protection Fund constituted by the Central Government under section 205A and 205C of the Companies Act,1956. The interim dividend

declared by the Company on 30.10.2010 if remained unclaimed /unencashed /unpaid will be transferred to such fund of the Central Government on 30.10.2017. It may be noted that no claim of the shareholder

will be entertained for the unclaimed dividend which have been transferred to the credit of the Investor Education and Protection Fund constituted by the Central Government under section 205B of the

CompaniesAct,1956. In view of the above, the Shareholders are advised to send all the unencashed dividend warrants to the Registered Office of the Company for revalidation and encash them before the due date for transfer to

the Central Government . An Explanatory Statement pursuant to section 173(2) of the Companies Act, 1956 in respect of Item No. 7 to 10 is annexed herewith and forms part of the Notice.

Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956. Item No.7 Mr. Ajay Paliwal was appointed as an Additional Director of the Company w.e.f. 23.03.2011. In accordance with the provisions of the Companies Act, 1956 and Articles of Association of the Company, he ceases to be a Director at the commencement of the ensuing Annual General Meeting. The Company has received a notice

4


under Section 257 of the Companies Act, 1956, from a member of the company proposing his candidature to the office of the Director along with a deposit of Rs. 500/-. None of the Directors of the company except Mr. Ajay Paliwal is interested or concerned in the passing of the resolution. Your directors propose the resolution as set out at item no. 7 of the accompanying notice . Item no.8 In order to diversify into certain new business ventures, your Directors have always been considering various

proposals. Amendments proposed by way of additions to the Object Clause in the Memorandum of Association as set out in the resolution under this item are to facilitate diversification etc., and enable the Company to enlarge its area of operation. Your directors are of the view that it will be beneficial for the Company and the members and also in harmony with greater public interest that the Company should diversify its activities. Your Directors are also of the view that the proposed additional objects may conveniently and advantageously be combined with the existing business of the

Company. Accordingly, the Directors propose to amend Clause IIIC of the Memorandum of Association of the Company as set out at item no. 8 of the accompanying Notice. To enable the Company to take these new lines of activities in due course as and when considered proper by the Board of Directors, alterations in the Object Clause of the Memorandum of Association are necessary. As per the provisions of Section 17 of the Companies Act, 1956, the Object Clause of the Company can be amended only by a special resolution passed by the members and accordingly the Directors of the Company recommend the resolution set out at item no. 8 for consideration and acceptance of the members. A copy of the Memorandum of Association together with all the proposed amendments is available for inspection at the registered office of the Company between 10.30 AM and 1.30 PM on all working days except Saturdays and holidays upto the date of the meeting. None of the directors of the Company is concerned or interested in any way in passing the resolution. Items no. 9 and 10 As per the provisions of Section 149 (2A) of the Companies Act, 1956, approval of the members in general

meeting is required for commencement of any business as set out in the Other Object under Clause IIIC of the Memorandum of Association. As a matter of expediency, approval of the members sought to enable the Directors at such time or times as they may

consider appropriate and in the interest of the Company to commence and undertake all or any of the business specified in the sub clause (i) and newly introduced sub clause (s) to the Object Clause IIIC of the Memorandum of Association of the Company upon aforesaid sub-clause becoming effective. The Board recommends the acceptance of the special resolutions as set out at item no.9 and 10 of the accompanying notice. A copy of the Memorandum of Association together with all the proposed amendments is available for

inspection at the registered office of the Company between 10.30 AM and 1.30 PM on all working days except Saturdays and holidays upto the date of the meeting.

5


None of the directors of the Company is concerned or interested in any way in passing the resolution.

For Liberty Phosphate Ltd. Registered Office: 74/75,GIDC, Nandesari, District : Vadodara PIN - 391 340

Place : Mumbai. REHANUMA KHAN Dated : 29th July, 2011 Company Secretary

Brief resume and other information in respect of Director(s) seeking appointment/re-appointment at the Annual General Meeting in accordance with the Clause- 49 of the Listing Agreement with the Stock Exchange: MR. SHAKIL ZAKARIA MEMON Mr. Shakil Zakaria Memon, aged 41 years, is associated with the company since 1987 and has rich and varied experience in managing the affairs of fertilizer industry. He is looking after production, marketing and other activities of the company. He is director in the Company since 01.04.2009. He is a member of the following Committees of the Board of Directors of the Company : 1. Audit Committee 2. Shareholders/Investors Grievance Committee.

Nature of expertise in specific functional area: Marketing He is director in the following companies:

(a) (b)

(c) (d)

(e)

Liberty Urvarak Limited Liberty Pesticides and Fertilizers Limited Tungabhadra Fertilizers and Chemicals Company Limited Durg Manures and Chemicals Company Limited Rama Buildcare Private Limited

He is not a Chairman / Member of any of the Committee(s) of Board of Directors of the above companies. He does not hold any share of the Company as on the date of this Notice. MR. SALIM ABDUL AZIZ SHERANI Mr. Salim Abdul Aziz Sherani, aged 52 years, has rich and varied experience in managing the affairs of fertilizer

industry. He is director in the Company since 28.04.2008. He is a member of the following Committees of the Board of Directors of the Company : 1. Audit Committee 2. Remuneration Committee. 3. Shareholders/Investors Grievance Committee.

6


Nature of expertise in specific functional area : Commercial Activities He is not a director in any other Company. Hence he is not a Chairman /Member of the Committee(s) of Board of Directors of any other Company. He does not hold any share of the Company as on the date of this Notice. MR.AJAY PALIWAL Mr. Ajay Paliwal , aged 33 years, is a Practising Chartered Accountant and has rich experience in the field of

auditing, accounting and taxation. He is a member of the following Committees of the Board of Directors of the Company : 1. Audit Committee 2. Remuneration Committee. 3. Shareholders/Investors Grievance Committee.

Nature of expertise in specific functional area : Finance, Accounts, Audit and Taxation. He is not a director in any other Company. Hence he is not a Chairman /Member of the Committee(s) of Board of Directors of any other Company. He does not hold any share of the Company as on the date of this Notice.

IMPORTANT COMMUNICATION TO MEMBERS

The Ministry of Corporate Affairs has taken a "Green Initiative in Corporate

Governance "by allowing paperless compliances by the companies and has permitted service of documents including Annual Report to its members through electronic modes. In this backdrop, the Company has given an option to the shareholders to receive the Annual Report through e-mail and is sending the Annual Report through e-mail to those members whose registered e-mail ids were available with us. To further support this initiative Members, whose e-mail ids have not been registered so far, are requested to register their e-mail addresses with their respective Depository Participant, in respect of holdings in Demat form and, with the company's RTA, M/s. Link Intime India Private Limited, in respect of shares held in physical form.

7


DIRECTORS' REPORT

To The Members of Liberty Phosphate Limited The Directors of your Company have pleasure in presenting Twenty Third Annual Report and the Audited Accounts of your Company for the year ended 31.03.2011. FINANCIAL RESULTS: Your Company's performance during the year as compared with that of the previous year is summarized below :

(Rs in Lakhs)

Particulars

Turnover including Other Income

Profit before Interest, Depreciation and Tax

Less : Financial Charges

Less : Depreciation

Profit before tax

Deferred tax (liability)/Assets

Provision for current Taxation

Income Tax of Earlier Years

Profit after tax

Add: Profit brought forward from previou s year

Amount available for appropriation

APPROPRIATION : Your Directors recommend appropriation as under:

2010-11

36765.95

6420.48

696.76

281.40

5442.31

0.59

1887.05

37.32

3518.52

3208.31

6726.84

2009-10

21010.83

1716.74

477.54

227.69

1011.51

7.45

368.75

2.59

647.62

2560.69

3208.31

(Rs in Lakhs)

Interim Dividend - Equity Arrears of Preference Dividend Proposed Dividend - Preference shares

- Equity Shares Dividend Distribution Tax Transfer to General Reserve Surplus Carried Forward Total Appropriation

2010-2011 86.63 120.00 40.00

86.63 54.86 87.97

6250.75 6726.84

2009-2010 Nil Nil Nil Nil Nil Nil

3208.31 3208.31

8


DIVIDEND:

Your Directors are pleased to recommend dividend at the rate of Rs. 0.80 per share on 8% Cumulative Redeemable Preference Share of nominal value of Rs. 10/- per share for the year 2010-2011. During the year 2010-2011, your Company paid interim dividend at the rate of Rs. 0.60 per share on equity shares

of nominal value of Rs. 10/- per share on 30.10.2010. In addition to the above, your Directors are pleased to recommend a final dividend at the rate of Rs. 0.60 per share on equity shares of nominal value of Rs. 10/- per share for the year 2010-2011. The payment of the aforesaid dividend is subject to the approvals of the members to be obtained at the ensuing Annual

General Meeting and shall be paid to those members, as per the law, whose name appear in the Register of members of the Company as on the book closure date . The total dividend payout in respect of equity shares for the year ended March 31, 2011 including final dividend

as recommended stands at Rs.1.20 per share (12% on equity shares) of the face value of Rs. 10/- per share.

OPERATIONS: During the year under review your Company recorded a turnover of Rs. 36765.95 Lakhs and earned a net profit after tax of Rs. 3518.52 Lakhs after providing for Income Tax as compared with the corresponding figures in the previous year of Rs 21010.83. Lakhs and Rs.647.62 Lakhs respectively. The turnover and net profit after

tax registered an increase of 74.99 % and 443.30 % over the corresponding figures of previous year. The increase in profitability is due to constant endeavour of the management with regard to cost control and cost reduction backed by higher capacity utilization.

PRODUCTION: During the year under review, your company achieved production of 386016 MT of Single Super Phosphate, NPK Mixed Fertilizers and Magnesium Sulphate as against production of 357729 MT in the previous year recording growth of 7.91 %. SUBSIDIARY: In view of the General Circular No.2/2011 No.5/12/2007-CL-III dated 8th February, 2011 issued by the Government of India, Ministry of Corporate Affairs, the Board of Directors of the Company has given their consent

by passing a resolution for not attaching the Balance Sheet of its wholly owned subsidiary viz; Liberty Pesticides and Fertilizers Limited, and accordingly has not attached the Balance Sheet of the Subsidiary as required pursuant to section 212 of the Companies Act,1956. Any shareholder desirous of obtaining the annual accounts of the subsidiary company and the related detailed information may write to the company for the same. The annual accounts of the subsidiary may be inspected by any member at the Registered Office of the holding company or at the Registered Office of the subsidiary company during working days in the office hours.

DIRECTORATE : In accordance with the Article 110 of the Articles of Association of the Company, Mr. Salim Abdul Aziz Sherani and Mr. Shakil Zakaria Memon retire by rotation and being eligible have offered themselves for re-

appointment.

9


Further, Mr. Ajay Paliwal was appointed as an Additional Director of the company with effect from 23.03.2011.

In accordance with section 260 of the Companies Act, 1956 and the Articles of Association of the Company, he

ceases to be a director of the Company at the commencement of the ensuing Annual General Meeting. Pursuant to

section 257 of the Companies Act,1956, the Company has received a notice from a member signifying his

intention to propose the candidature of Mr. Ajay Paliwal as director at the ensuing Annual General Meeting. Your Directors recommend the above appointment/re-appointment.

LISTING OF SHARES :

The Equity Shares of your Company are listed on Bombay Stock Exchange Limited, P. J. Towers, Dalal Street, Mumbai-400 001, and the listing fees for the year 2010-11 has been paid.

DEPOSITS:

During the year under review the Company has not invited / received deposits from public under Section 58A of the Companies Act, 1956.

CONSOLIDATION OFACCOUNTS:

As required under Clause 32 of the Listing Agreement with the Stock Exchange, at which the Equity Shares of the Company are listed and traded, the Audited Consolidated Financial Statements form part of the Annual Report.

AUDITORS :

M/s. V. Shah & Associates, Chartered Accountants, Vadodara and M/s. K. L. Vyas & Co., Chartered Accountants, Udaipur, Joint Statutory Auditors of the Company retire and being eligible have offered themselves

for re-appointment. Your Directors request you to appoint the auditors and fix their remuneration.

COSTAUDITORS :

Pursuant to directions from the Ministry of Corporate Affairs, H. R. Kapadia , Cost Accountants have been appointed as Cost Auditors for the year 2010-2011.They are required to submit the report to the Central

Government within 180 days from the end of the accounting year.

AUDITORS' REPORT:

The Auditors' observations are self explanatory and hence do not call for any further clarification under section 217 of the Companies Act, 1956.

DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of sub-section (2AA) of Section 217 of the Companies Act,1956, your Directors confirm:

(i) (ii)

(iii)

that in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed along with proper explanation relating to material departures; that the Directors have selected such Accounting Policies and applied them consistently and made

judgments and estimates that are 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 as on 31st March, 2011 and of the profit of the Company for that year; that the Directors have taken proper and sufficient care for the maintenance of adequate accounting

10


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; and

(iv) that the Directors have prepared the Annual Accounts on going concern basis.

CORPORATE GOVERNANCE: In compliance with the listing agreement with the Stock Exchange, the Report on Corporate Governance is enclosed as Annexure 'A'

MANAGEMENT DISCUSSIONSANDANALYSIS: In compliance with the listing agreement with the Stock Exchange, the Report on Management Discussions and Analysis is enclosed as Annexure 'B'.

PARTICULARS OF EMPLOYEES: As required by the provisions of Sub Section (2A) of Section 217 of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 1975, as amended, particulars of the employees are set out in the

Annexure to the Directors' Report. However, as per provisions of Section 219(1)(b)(iv) of the Companies Act, 1956 the report and the accounts are being sent to all the shareholders excluding the aforesaid information. Any shareholder, interested in obtaining such particulars may write to the Company Secretary at the registered office of the company for a copy of the same. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO : In pursuance to Section 217(1) (e) of the CompaniesAct.1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 the relevant information is annexed as Annexure 'C'

ACKNOWLEDGMENT:

The Directors acknowledge with gratitude the co-operation extended by bankers (i.e. Canara Bank, IDBI Bank Limited, Karur Vysya Bank Limited & State Bank of Patiala), Railway Authorities, and various Central and State Government authorities. The Directors also wish to place on record their appreciation to the team of executives,

staff and workers who have shown devotion and efficiency in performing their jobs.

For and on behalf of the Board of Directors

Place : Mumbai. Raoof Razak Dhanani Date : 29th July, 2011 Chairman & Managing Director

11


ANNEXURE 'A' TO THE DIRECTORS' REPORT

CORPORATE GOVERNANCE REPORT FOR THE YEAR APRIL 1st, 2010 TO MARCH 31st , 2011. INTRODUCTION Your Company has complied in all material respects with the requirements of Corporate Governance Code as per the

Clause 49 of the Listing Agreement with the Stock Exchange. A report on the implementation of the Corporate Governance Code of the Listing Agreement by the Company is furnished below.

1. COMPANY'S PHILOSOPHY : Your Company lays much emphasis on conducting business based on highest standards of corporate governance and transparent working based on integrity, fairness, equity and individual accountability. Every

effort is directed towards enhancing shareholders' value and safeguarding their wealth on sustainable basis. The company promotes ethical conduct of business and ensures compliance of applicable laws, rules and regulations. All stake holders such as Shareholders, Investors, Bankers, and Institutions etc. are well updated

with the information so that they are in a position to take considered decision.

2. BOARD OF DIRECTORSAND BOARD PROCEDURE: (i) Composition of Board: The Board of Directors of the Company consists of Directors having varied

experience in different areas. The composition of the Board is in conformity with the provisions of Clause

49 of the Listing Agreement. The Company has Executive Chairman. The composition and other details are as under : Name of Category of No. of the other Membership in No. of No. of Attendance in Director Director directorship held committee of other Board Board last AGM held

companies held meetings meetings Yes/No held attended

Mr. Raoof Razak Promoter Three NIL 9 9 No Dhanani Executive

Chairman Mr. Shakil Executive Five NIL 9 9 Yes Zakaria Memon Mr. Firoz Non- One NIL 9 8 No Asgar Executive Khambati Mr. Salim Non- NIL NIL 9 2 No Abdul Aziz Executive Sherani Mr. Abdul Executive NIL NIL 9 0 No Mabood Shaikh Mr. Hemant Non- NIL NIL 9 7 No Motilal Shah Executive Mr. Zafar Ullah Executive NIL NIL 9 1 N. A. Khan* Mr. Ajay Non- NIL NIL 9 0 N. A. Paliwal** Executive Mr. Tuntun Executive NIL NIL 9 1 No Singh Mr. Vinit J. Non- One NIL 9 8 No Shah Executive

*appointed w.e.f. 15.09.2010. **appointed w.e.f. 23.03.2011.

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(ii) None of the Directors is a member of more than ten Board level Committees of public limited companies

in which they are Directors or a Chairman of more than five such Committees.

(iii) During the period from 1st April, 2010 to 31st March, 2011, Nine Board Meetings were held with at least one meeting in every quarter at the following dates: 10.04.2010, 14.05.2010, 20.07.2010, 30.07.2010,

18.09.2010, 30.10.2010, 23.12.2010, 10.02.2011 and 23.03.2011. The gap between two consecutive

meetings was not more than four months. (iv) Information placed before the meeting:

The Board of the Company is presented with the notes in respect of the information covering matters listed

below, as and when applicable, from time to time. i) Annual operating plans and budgets, capital budgets, updates. ii) Quarterly results for the Company and its operating divisions or business segments.

iii) Minutes of the meetings of audit committee and other committees of the Board. iv) Information on recruitment and remuneration of senior officers just below the Board level. v)

Materially important show cause, demand, prosecution and penalty notices. vi) Any material effluent or pollution problems, fatal or serious accidents, dangerous occurrences. vii) Any material significant default in financial obligations to and by the Company or substantial

non-payment for goods sold by the Company. viii) Any issue, which involves possible public or product liability claims of substantial nature. ix)

Details of any joint venture or collaboration agreement. x) Transactions that involve substantial payment towards goodwill, brand equity or intellectual

property. xi) Significant labour problems and their proposed solutions. xii) Sale of material nature of investments, subsidiaries, assets that is not in normal course of

business. xiii) Quarterly details of foreign exchange exposures and the steps taken by management to limit the

risks of adverse exchange rate movement. xiv) Non-compliance of any regulatory, statutory nature or listing requirements and shareholders

service such as non-payment of dividend and delay in share transfer.

3.

AUDIT COMMITTEE The composition of the Audit Committee as on 31.03.2011 is as under: (a) Mr. Vinit J. Shah - Chairman (b) Mr. Firoz Asgar Khambati (c) Mr. S. Z. Memon Ms. Rehanuma Khan, Company Secretary acts as Secretary to the Committee.

Two-third members of the Committee are independent and non-executive directors. Brief description of terms of reference:

i) Oversight of the Company's financial reporting process and the disclosures of its financial information to ensure that the financial statement is correct, sufficient and credible.

ii) Recommending the appointment and removal of external auditors, fixation of audit fee and also approval for payment for any other services.

iii) Reviewing with management the annual financial statements before submission to the board, focusing primarily on: a. Any Changes in accounting policies and practices. b. Major accounting entries based on exercise of judgment by management c.

Qualification in draft audit report. d. Significant adjustments arising out of audit.

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e. The going concern assumption. f. Compliance with accounting standards.

g. Compliance with stock exchanges and legal requirements concerning financial statements. iv) Any related party transaction i.e. transactions of the Company of material nature, with promoters

or the management, their subsidiaries or relatives etc. that may have potential conflict with the interests

of the Company at large. v) Reviewing with the management, external and internal auditors, and the adequacy of internal

control systems. vi) Reviewing the adequacy of internal audit function, including the structure of internal audit

department, staffing and seniority of the official heading the department, reporting structure, coverage

and frequency of internal audit. vii) Discussion with internal auditors about any significant findings and follow up thereon. viii) Reviewing the findings of any internal investigations by the internal auditors into matters where

there is suspected fraud or irregularity or a failure of internal control systems of a material nature and

reporting the matter to the board. ix) Discussion with external auditors before the audit commences, nature and scope of audit as well as

post-audit discussion to ascertain any area of concern. x) Reviewing the Company's financial and risk management policies. xi) To look into reasons for substantial defaults in the payment to the depositors, debenture holders,

shareholders (in case of non payment of declared dividends) and creditors.

Minutes of each Audit Committee were placed before and discussed in the Board Meeting. Five meetings of the Audit Committee were held during the year on 14.05.2010, 20.07.2010, 30.07.2010,

30.10.2010, 10.02.2011. The necessary quorum was present at the meetings. The attendance of each member of the Committee is given below: Name of Director Number of Meetings held Number of Meetings attended Mr Vinit J. Shah 5 5 Mr Firoz Asgar Khambati 5 5 Mr Shakil Zakaria Memon 5 5

4. REMUNERATION COMMITTEE:

The Remuneration Committee comprised of the following persons an on 31-03-2011:

(a) Mr. Vinit J. Shah - Chairman (b) Mr. Firoz Asgar Khambati (c) Mr. Salim Abdul Aziz Sherani

Ms. Rehanuma Khan, Company Secretary acts as the Secretary to the Committee. (i) Brief description of terms of reference:

a. Frame Company's policies on Board and Directors with the approval of the Board. b. Review and recommend compensation payable to the executive directors including

revision. (ii) The Remuneration Committee functioned under the Chairmanship of Mr .Vinit J. Shah. The

other member of the Committee are Mr. Firoz Asgar Khambati and Mr Salim Abdul Aziz Sherani. The

members of the Committee are independent, Non- executive Directors. The quorum for the meetings of the Committee requires presence of all of its members.

(iii) During the year under review, the meetings of Remuneration Committee were held on 10.04.2010 and 20.07.2010 to recommend annual Increment of existing Wholetime Directors due on

1-4-10, revision in remuneration of Managing Director & to recommend the appointment & terms &

conditions of remuneration of Wholetime Director Mr. Zafar Ullah Khan.

14


The necessary quorum was present at the meetings. The attendance of each member of the Committee is given below:

Name of Director

Mr Vinit J. Shah Mr Firoz Asgar Khambati Mr Salim Abdul Aziz Sherani

Number of meetings held

2

2

2

Number of

Meetings

attended 2 2

2

5.

MANAGEMENT: (i) MANAGEMENT DISCUSSIONANDANALYSIS:

Management Discussion and Analysis is attached herewith and forms part of this Annual Report.

(ii) DISCLOSURES: (a) Transactions with the related parties are disclosed in Note No.11 of Schedule '20' "Notes on

Accounts" annexed to the Accounts in the Annual Report. (b) No transaction of material nature has been entered into by the Company with its Directors or

Management and their relatives, etc. that may have a potential conflict with the interests of the Company. The Register of Contracts containing transactions in which directors are interested, is placed before the Board regularly.

(c) There have been no instances of non-compliance by the Company on any matter related to capital markets. Hence, the question of penalties or strictures being imposed by SEBI or the stock exchange or any statutory authorities does not arise.

(d) Though there is no formal Whistle Blower Policy, the Company takes cognizance of complaints made and suggestions given by the employees and others. Even anonymous complaints are looked

into and whenever necessary, suitable corrective steps are taken. No employee of the Company has been denied access to the Audit Committee of the Board of Directors of the Company.

(e) In the preparation of financial statements, the Company has followed the Accounting Standards issued by The Institute of Chartered Accountants of India to the extent applicable.

(f) A certificate from CEO and CFO was placed before the Board. (g) The Company has periodic review and reporting to the Board of Directors of risk assessment by

the senior executives with a view to minimize risk. (h) The details of the remuneration paid/ payable to the Directors and their relationship with other

directors, if any, are as under :

Name of the Director Relationship Sitting Salaries and Commission Total with other directors fees perquisites (Rs. in (Rs. in

(Rs.in including PF Lakhs) Lakhs) Lakhs) Contribution

(Rs. in Lakhs) Mr.R. R. Dhanani None Nil 70.32 224.22 294.54 Mr. S. Z. Memon None Nil 5.71 Nil 5.71

Mr.Tuntun Singh None Nil 4.00 Nil 4.00

Mr. A. M. Shaikh None Nil 4.70 Nil 4.70 Mr. Z. U. Khan None Nil 3.76 Nil 3.76

15


Name of the Director Service Notice Severance Performance Stock

Contract Period fees Linked Bonus options Mr. R. R. Dhanani 3 years 6 months Nil Nil Nil Mr. S. Z. Memon 3 years 3 months Nil Nil Nil Mr. Tuntun Singh 3 years 3 months Nil Nil Nil Mr. A. M. Shaikh 3 years 3 months Nil Nil Nil Mr. Z. U. Khan 3 years 3 months Nil Nil Nil

6. 7.

Non- Executive Directors of the Company are not paid any remuneration. No sitting fee is paid to the

directors for attending the meeting of the Board and the Committees thereof. SUBSIDIARIES : The Company has one Indian Subsidiary - Liberty Pesticides & Fertilizers Limited. As per Clause 49(III) of the Listing Agreement, it does not constitute a material non-listed Indian Subsidiary. The minutes of the Board meetings of the Subsidiary are placed before the meetings of the Board of

Directors of the Company along with a statement showing the significant transactions and

arrangements entered into by the Subsidiary. SHAREHOLDERS: (i) DIRECTOR SEEKINGAPPOINTMENT/RE-APPOINTMENT:

Disclosures about the particulars of the directors seeking appointment/re-appointment at the

ensuing Annual General Meeting have been furnished in the annexure to the notice convening the

Annual General Meeting .

(ii) SHAREHOLDERS / INVESTOR GRIEVANCES COMMITTEE: The Shareholders / Investor Grievance Committee comprised of the following persons as on 31-03-2011:

(a) Mr. Vinit J. Shah - Chairman (b) Mr. Firoz Asgar Khambati (c) Mr. Shakil Zakaria Memon

The Committee met four times during the year on 14.05.2010, 30.07.2010, 30.10.2010 and

10.02.2011. The necessary quorum was present during all the meetings. The attendance of each member of the Committee is given below :

Name of Director Mr. Vinit J. Shah Mr. Firoz Asgar Khambati Mr. Shakil Z. Memon

Number of meetings held

4

4 4

Number of Meetings

attended 4 4 4

Ms. Rehanuma Khan, Company Secretary acts as the Secretary to the Committee. (iii) SHARE TRANSFER COMMITTEE:

Power of Attorney for transfer of shares and related matters has been given to Share Transfer Agent

i.e. M/s. Link Intime India Pvt. Ltd. (formerly known as M/s Intime Spectrum Registry Limited) on

30.04.2007. During the year, no meeting of Share Transfer committee has been held. On

31.03.2011, no application for share transfer was under process. On 31.03.2011, no Demat request

was under process.

16


8. GENERALBODY MEETINGS:

Particulars of Annual General Meetings (AGM) held in the last three years are given below:

Date Time Nature of Venue No of Special Meeting Resolution

Passed 14.08.2008 11.00A.M. A.G.M. 74-75, G.I.D.C. Nandesari (Guj.) Nil 31.08.2009 11.00 A.M. A.G.M. 74-75, G.I.D.C. Nandesari (Guj.) Nil

15.09.2010 11.00 A.M. A.G.M. 74-75, G.I.D.C. Nandesari (Guj.) 1

9.

10.

11.

No resolution was put through postal ballot. CODE OF CONDUCT : The Board of Directors has laid down the Code of Conduct for all the Board Members and the members of the

Senior Management of the company. Certificate from Managing Director of the Company affirming

compliance of the said Code by all the Board Members and Senior Management of the Company to whom

the Code is applicable, is annexed separately to this Report. MEANS OF COMMUNICATION: The quarterly/half yearly/ annual unaudited / audited financial results of the Company are sent to Bombay Stock Exchange Limited where the shares of the Company are listed, immediately after their approval by the Board. The above results are generally published in English and Gujarati language newspapers circulating in Gujarat. The results are not sent to the shareholders at their home. The Company has placed its financials on its website www.libertyphosphate.com During the year, the Company has neither made any representation to any analyst nor has given any press release. GENERAL SHAREHOLDERS INFORMATION: (i) Annual General Meeting:

Date and Time Venue

(ii) Financial Calendar: Board meeting for consideration of Accounts for the year ended on 31.03.2011. Book Closure date

Board Meeting for consideration of Unaudited results for the first three quarters of the current financial year viz: April 01,2011 to March 31,2012. Board Meeting for consideration of audited results for the current financial year ending March 31,2012.

17

: 14th September, 2011 at 11.00A.M.

: 74-75, GIDC, Nandesari-391 340 District -Baroda (Guj.).

: 29-07-2011

: 08.09.2011 to 14.09.2011 (both days inclusive)

: within one & half month from the end of the quarter as stipulated under the listing agreement with the Stock Exchange.

: within two months from the end of the last quarter as stipulated under the listing agreement with the Stock Exchange (tentative).


(iii) Dividend Payment Date

(iv) Listing on Stock Exchange Details:

Name and address

: The proposed dividend, if approved, at the `ensuing Annual General Meeting, will be distributed on or around 14th September, 2011, within the statutory time limit.

Stock Code

Bombay Stock Exchange (BSE)h Phiroze Jeejeebhoy Towers, 25t Floor, Dalal Street, Mumbai- 400 001.

530273

Listing fee for the year 2010-2011 has been paid.

(v) Stock Market Price Data and Stock Performance: High/Low share prices during the year i.e. 1stApril, 2010 to 31st March, 2011:

Month LPL's Share Price (BSE) BSE Sensex (in Rs.) (in Rs.)

High Low High Low April, 2010 35.50 28.25 18047.86 17276.80 May, 2010 30.55 25.00 17536.86 15960.15 June, 2010 45.45 25.00 17919.62 16318.39 July, 2010 60.95 42.50 18237.56 17395.58 August, 2010 61.45 51.00 18475.27 17819.99 Sept., 2010 65.45 56.00 20267.98 18027.12 October, 2010 85.70 57.00 20854.55 19768.96 November, 2010 82.40 50.30 21108.64 18954.82 December, 2010 62.40 45.45 20552.03 19074.57 January, 2011 57.40 42.05 20664.80 18038.48 February, 2011 57.75 42.00 18690.97 17295.62 March, 2011 49.00 43.00 19575.16 17792.17

(vi) Registrar and Transfer Agent:

The Company's shares are processed and transferred by Share Transfer Agent - M/s. Link Intime India Pvt. Limited. The Company complies with the requirements of Clause - 47 of the Listing Agreement.

Address for communication

: M/s. Link Intime India Limited B-102 & 103, Shangrila Complex, Off. HDFC Bank, Near Radhakrishna Char Rasta, Akota, Vadodara - 390 020 Phone : 0265-2356573, 2356794. Fax : 2356791 E-Mail : [email protected]

(vii) Email ID of Grievance Redressal Division/Compliance Officer :

[email protected]

website : www.libertyphosphate.com

18


(viii) Share Transfer System:

Share transfer in physical form, if clear in all respect, are affected and returned within a period of 30 days from the date of receipt by the Share Transfer Agent. The Equity Shares of the Company are traded on the Stock Exchange compulsorily in demat mode.

(ix) Shareholding Pattern as on 31.03.2011 :

Category

Promoters Financial Institutions Mutual Funds Insurance Companies Nationalised Banks Bodies Corporate Foreign Body Corporate NRI/NR Indian Public TOTAL

No. of Equity shares held

7493003 NIL

NIL NIL NIL

623794 2000000 197915

4123489 14438201

Shareholding %

51.90 NIL

NIL NIL NIL

4.32 13.85 1.37

28.56 100.00

(x) Distribution of shareholding as on 31.03.2011 :

No. of Equity Shares No. of No. of shares held Shareholding % shareholders

1 to 500 4285 828642 5.7392

501 to 1,000 1,001 to 2,000

2,001 to 3,000

3,001 to 4,000

4,001 to 5,000 5,001 to 10,000

10,001 and above TOTAL

722 274

102

46

39 77 67

5612

625668 441249

269079

166219

188498 582683

11336163

14438201

4.3334 3.0561

1.8637

1.1512

1.3056 4.0357

78.5151 100.00

(xi) Dematerialization of shares and liquidity: Trading of the Company's shares is compulsory in dematerialized form for all investors. Out of the

issued equity shares, 1,21,70,753 equity shares have been dematerialized with the following depositories as on 31.03.2011 representing 84.295%:

Description ISIN Depositories

Equity Shares INE639D01011 National Securities Depositories Limited

and

Central Depository Services (India) Limited

The liquidity of shares is normal.

19


(xii) Location of Plant (a) 74-75, GIDC, Nandesari, Baroda. (b) F-227, M.I.A., Madri, Udaipur (Raj.). (c) 19, Bhimpura IndustrialArea,

Jagpura, Kota (Raj.) (d) Survey No. 122 & 129, Rasal,

Tal. Sudhagad, Dist. Raigad (Maharashtra).

(xiii)Address for communication : LIBERTY PHOSPHATE LIMITED 74/75,GIDC, Nandesari, District : Vadodara PIN - 391 340 Phone No. : 0265-3063377, 2840096 Fax No. : 0265- 3062499 E-mail : [email protected]

Website : www.libertyphosphate.com

(xiv) The Company has not obtained any public fund in the last three years.

(xv) Outstanding GDR/ADR : NotApplicable. (xvi)Adoption of non-mandatory : The Company has, so far, not implemented

requirements Non-Mandatory requirements of the Code of Corporate Governance other than Remuneration Committee.

ANNEXURE TO CORPORATE GOVERNANCE REPORT Declaration regarding affirmation of Code of Conduct

In terms of the requirement of Clause 49 of the Listing Agreement, this is to confirm that all the members of the Board

and the Senior Management Personnel have affirmed compliance with the Code of Conduct of the company for the year ended on 31st March, 2011.

Place : Mumbai Date : 29th July, 2011.

Raoof Razak Dhanani Chairman & Managing Director

20

23rd Annual Report 2010-11 To The Board of Directors Liberty Phosphate Limited 74-75, GIDC, Nandesari, Distt. Baroda (Guj.).

Liberty Phosphate Ltd.

Re : REPORT ON CORPORATE GOVERNANCE

We have examined the records concerning the Company's compliance of the conditions of Corporate Governance

as stipulated in Clause 49 of the Listing Agreement entered into by the Company with Bombay Stock Exchange Limited for the financial year ended on 31st March, 2011. The objective of our examination is to give our opinion on whether the Company has complied with the

conditions of Corporate Governance as stipulated in the provisions of Clause 49 of the Listing Agreement entered into by the Company with the Stock Exchange. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the

compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of an opinion on the financial statements of the company. We have conducted our examination on the basis of the relevant records and documents maintained by the

Company and furnished to us for examination and the information and explanations given to us by the Company. Based on such examination, in our opinion, the Company has complied with the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement of the Stock Exchange. We further state that such compliance is neither an assurance as to the future viability of the Company nor to the

efficiency with which the management has conducted the affairs of the Company.

For V. SHAH & ASSOCIATES Chartered Accountants FRN : 109816W

(V. R. Shah) Proprietor M.No.34994

For K.L. VYAS & COMPANY Chartered Accountants FRN: 003289C

(K. L. Vyas) Partner M.No. 72043

Place: Mumbai

Date : 29th July, 2011.

21


ANNEXURE - B

MANAGEMENT DISCUSSIONANDANALYSIS The Board takes pleasure in presenting your Company's Twenty Third Annual Report for the year 2010-11 along with the compliance report on Corporate Governance. This chapter on Management Discussion and

Analysis forms part of the compliance report on Corporate Governance. Industry Structure and Development: India is basically an agricultural country in which economy depends largely upon its agrarian produce. Agricultural sphere contributes about 25% to the country's GDP. As a result, Indian fertilizer industry has

tremendous scope in and outside the country as it is one of the allied parts of agriculture. Fertilizer industry in India is dedicated to meet the requirements of agricultural industry since its inception in 1906. The industry gained impetus in its growth due to green revolution in late sixties, followed by seventies and

eighties when fertilizer industry witnessed an incredible boom in the fertilizer production. However,

conventional agricultural practices are still being pursued by the farmers who use most efficacious quality seeds

& fertilizer due to poverty. Major portion of Indian farmland is Sulphur deficient, and it adversely affects the crop

yield. N, P, K & S in proper ratio helps eliminate deficiency of soil. Single Super Phosphate (SSP)fertilizer

contains Sulphur and Calcium besides Phosphorus so it is an ideal manure to eliminate sulphur deficiency of soil.

SSP is a low priced fertilizer and also suitably meets the essential nutrient requirements of the soil. Therefore, it is

preferred by small and marginal farmers. Subsidy on SSP has made it affordable by the cultivators. Today, Indian Fertilizer Industry is developing in terms of technology. Indian manufacturers are adopting advanced manufacturing processes to prepare innovative new products for Indian agriculture. Indian farmers have

started making pace with the technological development. Uses of modern techniques of sowing have shifted the

demand towards the granular product. Performance: Registering a turnover of Rs. 36765.95 Lakhs, the Company has earned a net profit of Rs. 3518.53 Lakhs after providing for Income Tax compared to the corresponding figures in the previous year of Rs. 21010.83 Lakhs and Rs.

647.62 Lakhs respectively. Consequently the turnover and net profit have soared by 74.99% and 443.30 % over

the corresponding figures of previous year. The higher demand for fertilizers this fiscal is attributed to a better

monsoon than the gone by fiscal. Production: During the year under review, your company succeeded in surpassing the targeted production and achieved production of 386016 MT of Single Super Phosphate, NPK Mixed Fertilizers and Magnesium Sulphate as against

production of 357729 MT in the previous year recording growth of 7.91 %. Internal Control Systems and their adequacy: The Company has proper and adequate system of internal controls to protect its all assets against loss from unauthorized use or disposition and all transactions are authorized, recorded and reported in conformity with

generally accepted accounting principles. The Board of Directors has an Audit Committee, whose Chairman is an Independent Director. The Committee meets periodically to review internal controls.

22


Human Resources:

People play a vital role in an organization's portfolio and human capital forms the critical part of its privileged assets. Company continued its commitment to acquire, develop and enhance its human potential. Company's

strategy of empowering people at all levels to take decisions and encouraging free flow of information and ideas,

has helped in strengthening its human capital. Opportunities : The Company has four manufacturing units situated at Udaipur (Rajasthan), Nandesari (Gujrat), Kota (Rajasthan) and Pali (Maharashtra) which put it in a good stead to speedily service demand. Proximity to raw material

sources/markets coupled with a dedicated multi-disciplinary work force has all along enabled the company to respond to spurts in demand. The Company's brand of Agri Inputs "DOUBLE HORSE" are well accepted in the market as premium quality products. With the NBS Policy in place, SSP has become attractively priced and given the extra margins. The company can embark upon aggressive product promotion and

customer education programmes which are required since the major target customer is the poor Indian farmer. The

company with its sales network has started encashing on its link with the farmer to promote other Agri Inputs. The

company is in advanced stage of talks with other manufacturers to roll out a newer products so as to have a larger basket

of offerings to its customers. Threats : Increase in margins will usher in new competition even business houses with zero experience in fertilizer manufacturing entering the sector, which the company is well poised to tackle since it has been in the market for long

and its brand established. The company's business is dependent upon policy dispensations of the Government.

Any change is likely to affect the projections and plans of the company. Future Outlook: For an industry dependent upon food grain production to meet the ever growing population, there is nothing but growth in store and the future outlook is positive. Recent policy initiatives by the Government pointing to

decontrol augur well for the company since the Government wants to give subsidy to the farmers directly rather than

routing it through fertilizer companies. When implemented, the company's fund flow will improve since there will no

delay in receiving funds from the Government as subsidy which is a very time taking and cumbersome process. Cautionary Statement: Statement in this management discussion and analysis describing the Company's objectives, projection, estimates and expectations may be 'forward looking statements' within the meaning of applicable laws and

regulations. Actual results may differ from those expressed or implied as many factors- like, availability of raw

materials, changes in political and economic environment in India, applicable Statutes, Labour Relations and Interest

Costs etc., may affect the company's operations.

23


ANNEXURE -C

PARTICULARS PURSUANT TO 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 AND FORMING PART OF THE DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH, 2011. 1) CONSERVATION OF ENERGY:

a) The company is taking adequate steps for the conservation of energy at every stage of production.

b) The steps taken by the Company for conservation of energy will result in reduction of energy consumption and consequent impact on the cost of production in the coming years.

c) The information pertaining to total energy consumption and energy consumption per unit of production. i) POWER AND FUEL CONSUMPTION

1. a)

b)

2.

3.

4.

Electricity Purchased: Unit : '000 KWH Total Amount (Rs. in Lakhs) Rate / Unit Rs.

Own generation: Units generated Units per ltr of fuel Cost / Unit Rs. Coal Quantity MT Total Cost (Rs. in Lakhs) Average rate / MT Rs. Furnace Oil Quantity KL Total Cost Rs. in Lakhs Rate / KL Rs. Other internal generation Total Cost (Rs. in Lakhs) Rate / Unit

2010-11 10287.32 522.08 5.07 NIL

NIL

NIL

5405.616 311.27 5758.25 NIL

NIL

NIL NIL

NIL

2009-10 9148.31 454.55

4.97 NIL NIL

NIL

4333.764 208.14 4802.86

NIL NIL NIL NIL

NIL

ii) POWER CONSUMPTION PER UNIT OF PRODUCTION

Product

Single Super Phosphate

Standard ( if any)

N.A.

Year ended 31.03.2011

18..81

Year ended 31.03.2010

18.61

24


2)

3)

TECHNOLOGYABSORPTION: The Company has carried no Research and Development activities during the year under review, however

the Company continues to take measures to improve the process and reduce the cost time to time when found necessary. The company has not imported any technology. FOREIGN EXCHANGE EARNINGSAND OUTGO:

Foreign Exchange earnings: Exports

Foreign Exchange outgo: Foreign Travel

Raw Material Traded Goods and Spares

Year Ended 31.03.2011

25.75 1.43

6775.26 684.97


58.09 2.53

7863.80

3241.79

25


AUDITORS' REPORT

The Members of Liberty Phosphate Limited,

1. 2. 3. 4.

We have audited the attached Balance Sheet of Liberty Phosphate Limited as at 31st March, 2011 and also the Profit and Loss Account for the year ended on that date annexed thereto and Cash Flow Statement for the year ended on that date. These financial statements are the responsibility of the company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the auditing standards generally accepted in India, Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order.

Further to our comments in the Annexure referred to above, we report that:

(i)

(ii)

(iii)

(iv) (v)

(vi)

We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

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

The Balance Sheet, Profit and Loss Account & Cash Flow Statement dealt with by this report are in agreement with the books of account;

In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.

On the basis of written representations received from the directors, as on 31st March, 2011 and taken

ston record by the Board of Directors, we report that none of the directors is disqualified as

on 31 March 2011 from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

In our opinion and to the best of our information and according to the explanations given to us, the said accounts give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

(a) In the case of the Balance Sheet, of the state of affairs of the company as at 31st March, 2011, and

(b) In the case of the Profit and Loss Account, of the profit for the year ended on that date. (c) In the case of Cash Flow statement of the cash flow for the year ended on that date.

For V. Shah & Associates, For K. L. Vyas & Company, Chartered Accountants Chartered Accountants

FRN: 109816W FRN: 003289C

Place : Mumbai. (V. R. Shah) (K. L. Vyas) Date : 29th July, 2011 Proprietor Partner

M.No. 34994 M.No. 72043

26


ANNEXURE REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OF LIBERTY PHOSPHATE LIMITED ON THE ACCOUNTS AS AT AND FOR THE YEAR ENDED 31ST MARCH, 2011.

(i) (ii)

(a) The company has maintained proper records showing full particulars including quantitative details

and situation of fixed assets.

(b) We are informed that the fixed assets of the company have been physically verified by the Management according to a phased programme designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the company and nature of its assets. Pursuant to the programme, physical verification was carried out during the year and no material discrepancies were noticed.

(c) During the year, the company has not disposed off a major part of the plant and machinery, which has affected the going concern status of the Company.

(a) We are informed that the inventories of the Company have been physically verified by the Management during the year. In respect of inventories lying with third parties, these have been confirmed by them.

(b) In our opinion, the procedures for physical verification of inventories followed by Management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) On the basis of our examination of the records of the Company, we are of the opinion that the company is maintaining proper records of inventories. The discrepancies noticed on verification between the physical and book records were not material.

(iii) (a) The company has not granted any loans, secured or unsecured, to companies, firms or other parties

covered in the register maintained under section 301 of the Companies Act, 1956.

(b) The Company has taken interest free unsecured loan from companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 amounting to Rs. 268.28 Lacs (Previous Year - Rs. 99.77 Lacs) and balance due as the year end is amounting to Rs. 268.28 Lacs (Previous Year - Rs. 99.77 Lacs).

(c) (i) We are further to inform that the unsecured loan taken from the companies, firms or other parties covered in the register maintained under section 301 of the Companies Act, 1956 are not prima- facie prejudicial to the interest of the company as the same are interest free and stated to be on long term basis, and accordingly there is no stipulation as to the payment of principal and interest thereon during the intervening period of currency of the Unsecured Loans. (ii) Since the company has not granted any loan to any company, firm or other parties covered under the register maintained under section 301 of the companies Act, 1956, therefore the provision of clause - 4 (iii) of the Companies (Auditor's Report) Order,2003 are not applicable to the company.

(iv) In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the company and the nature of its business for the purchase of inventory, fixed assets and also for the sale of goods and services. During the course of our audit, we have not observed any continuing failure to correct major weaknesses in internal controls.

(v) (a) To the best of our knowledge and belief and according to the information and explanations given to

us, we are of' the opinion that the particulars of the contracts or arrangements referred to in Section 301 of the Companies Act, 1956 have been so entered in the register required to be maintained under that Section.

27


(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time.

(vi) In our opinion and according to the information and explanations given to us, the company has not accepted deposits from the public except deposits exempt under The Companies (Acceptance of Deposits) Rules, 1975 during the year under review. As such, the provisions of sections 58A and 58AA of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public are not attracted.

(vii) In our opinion, the company has an internal audit system commensurate with the size and nature of its business.

(viii) We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained by the company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of records with a view to determine whether they are accurate & complete.

(ix) (a) The Company is generally regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor education protection fund, employees' state insurance, income tax, sales tax, wealth tax, custom duty, excise duty, service tax & Cess and other material statutory dues as may be applicable to it.

(b) According to the information and explanations given to us, there are no undisputed amount payable

in respect of Income Tax, Sales Tax, Custom Duty, Excise Duty, Service Tax & Cess, which were in arrears, as at 31st March, 2011 for a period of more than six months from the date, same became payable.

(c) According to the information and explanations given to us, details of the dues of sales tax, income tax, customs duty, wealth tax, excise duty and service tax & cess which have not been deposited on account of any dispute are given below.

Name of Statute Nature of Period to which Forum where the dispute Total

Dues the amount is pending Amount relates (Rs.in Lacs)

Central Sales Tax Act & Purchase Tax, Gujarat Sales Tax Act . Interest & 1999-2000. Honourable Sales Tax 13.02

Penalty Tribunal, Ahmedabad. Income Tax Act, 1961 Income Tax & 1993-1994 ITAT, Ahmedabad 3.50

Interest (A.Y. 1994 - thereon 1995)

Customs Act, 1962 Customs duty 2005-2006 Honourable High Court 31.73 on import of 2006-2007 of Mumbai. 32.44

Raw Material 2007-2008 11.51 2008-2009 125.68

2009-2010 81.55 2010-2011 61.25

344.16

Total 360.68

28


(x) The company does not have accumulated losses. The company has not incurred cash losses during the

financial year covered by our audit and the immediately preceding financial year.

(xi) Based on our audit procedures and according to the information and explanations given to us, we are of

the opinion that the Company has not defaulted in repayment of dues to financial institutions, banks and debenture holders.

(xii) In our opinion and according to the explanations given to us and based on the information available, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other securities.

(xiii) In our opinion, the company is not a chit fund or a nidhi mutual benefit fund/ society. Therefore, the provisions of clause (xiii) of paragraph 4 of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the company.

(xv) According to information and explanations given to us, company has not given any guarantee for loans taken by others from the banks or financial institutions.

(xvi) The Company has raised new term loans during the year. The term loans outstanding at the beginning of

the year and those raised during the year have been applied for the purposes for which they were raised.

(xvii) According to the information and explanations given to us and on an overall examination of the Balance Sheet of the company, we are of the opinion that there are no funds raised on short-term basis that have been

used for long-term investment.

(xviii)According to the information and explanations given to us, the company has not made any Preferential Allotment Shares to the parties covered in the Register maintained u/s 301 of the Companies Act.

(xix) We are to inform that no debentures have been issued by the company during the year under review. (xx) The Company has not raised any money by way of public issue during the year under review. (xxi) In our opinion and according to the information and explanations given to us, no material fraud on or by

the company has been noticed or reported during the year.

For V. Shah & Associates, For K. L. Vyas & Company, Chartered Accountants Chartered Accountants FRN: 109816W FRN: 003289C

Place : Mumbai. (V. R. Shah) (K. L. Vyas) Date : 29th July, 2011 Proprietor Partner

M.No. 34994 M.No. 72043

29


BALANCE SHEET AS AT 31ST MARCH, 2011 ( Rs )

AS AT AS AT SCHEDULE 31.03.2011 31.03.2010

I. SOURCES OF FUNDS (1) SHAREHOLDERS' FUNDS

(a) Share Capital 1 194382010.00 194382010.00 (b) Share Application Money 1A - -

(c) Reserves & Surplus 2 722822924.48 409782558.88

(2) LOAN FUNDS (a) Secured Loans 3 594238538.54 384687490.29 (b) Unsecured Loans 4 26828110.26 11683099.71

(3) DEFERRED TAX LIABILITY (Note No.10) 7746000.00 7805000.00

TOTAL 1546017583.28 1008340158.88

II. APPLICATION OF FUNDS (1) FIXED ASSETS 5

(a) Gross Block 528509337.45 418915788.93

(b) Less: Depreciation 225700349.13 197892147.54

(c) Net Block 302808988.32 221023641.39

(d) Capital Work in Progress 74254763.57 16919059.64

377063751.89 237942701.03

(2) INVESTMENTS 6 29879361.00 29376274.00 (3) CURRENT ASSETS,LOANS & ADVANCES 7

(a) Inventories 890355341.52 1000537088.24

(b) Sundry Debtors 625933127.62 278951818.60 (c) Cash and Bank Balances 326311867.69 102815326.32 (d) Loans & Advances 224990098.87 199942358.46

2067590435.70 1582246591.62 LESS: CURRENT LIABILITIES & PROVISIONS 8 (a) Current Liabilities 806239237.31 830186664.77 (b) Provisions 122754054.00 16233408.00 NET CURRENT ASSETS 1138597144.39 735826518.85

(4) MISCELLANEOUS EXPENDITURE 9 (To the extent not written off or adjusted) (a) Preliminary Expenses 477326.00 462210.00 (b) Issue Related Expenditure - 193919.00 (c) Deferred Revenue Expenditure - 4538536.00

TOTAL 1546017583.28 1008340158.88

Accounting Policies 19 Notes on Accounts 20

SCHEDULES 1 TO 20 FORM AN INTEGRAL PART OF THE ACCOUNTS. This is the Balance Sheet referred to in our Report of even date.

For V.Shah & Associates, For K.L.Vyas & Company, For and on behalf of the Board, Chartered Accountants Chartered Accountants FRN: 109816W FRN: 003289C

(V.R.Shah) (K.L.Vyas) (R.R.Dhanani) (S.Z.Memon) Proprietor Partner Chairman & Managing Director Director M.No. 34994 M.No. 72043

Place : Mumbai (Rehanuma Khan)

Date : 29th July, 2011 Company Secretary

30


PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2011 (Rs.)

INCOME FROM OPERATIONS Sales Other Income Cost of SSP Consumed for NPK Manufacturing Increase/(Decrease) in Stock of Finished Goods COST OF OPERATIONS

Raw Materials Consumed Packing Material Consumed Cost of Goods Traded Manufacturing Expenses Personnel Cost Selling & Distribution Expenses Administration & General Expenses Differential Custom Duty Financial Charges Depreciation Operating Profit/(Loss) Adjustment for earlier years

- Excess/(Less) Provisions - Prior Period Income/(Expenses)

Profit before tax Provision for Current Taxation Deferred Tax (Liability)/Assets (See Note No.11) Excess/(Less) provision for tax of earlier years. Net Profit/(Loss) after Tax

SCHEDULE

10

11 12

13

14

15

16

17

18

5

YEAR ENDED 31.03.2011

3641776871.60 34818436.67

98610.50

(348894265.09) 3327799653.68

1677749355.18 94400642.10

184370467.54

160102915.98

123897861.09

373116951.47 67722832.45 5708948.00

69676392.52

28140290.46

2784886656.79 542912996.89 1636791.83 (318,698.52) 544231090.20

(188705000.00) 59000.00

(3732529.00) 351852561.20


2041250941.01

59096111.11 736000.00

564798916.00 2665881968.12

1517515387.66

80107426.70

427590560.72

123578075.73 80161539.45

238019069.69 46900531.40

- 47753408.49 22769375.48

2584395375.32

81486592.80 19241185.54

423507.84 101151286.18

(36875000.00) 745000.00

(258823.00) 64762463.18

Balance of Profit / (Loss) brought forward from previous year Balance Available for Appropriation Less: Interim Dividend Paid on Equity Shares Less: Arrears of Dividend Paid on 8% Cumulative

Non Convertible Redeemable Preference Share Less: Proposed Final Dividend on Equity Share Less: Proposed Dividend on 8% Cumulative Non Convertible

Redeemable Preference Share Less: Tax on Dividend Less: Amount Transferred to General Reserve Balance Carried to Balance Sheet

320831350.88 672683912.08 8662920.60 12000000.00 8662921.00 4000000.00

5486354.00 8797000.00

625074716.48

256068887.70

320831350.88 - -

- - - -

320831350.88

Accounting Policies 19 Notes on Accounts 20

SCHEDULES 1 TO 20 FORM AN INTEGRAL PART OF THE ACCOUNTS. This is the Profit and Loss Account referred to in our Report

of even date.

For V.Shah & Associates, For K.L.Vyas & Company, For and on behalf of the Board. Chartered Accountants Chartered Accountants FRN: 109816W FRN: 003289C

(V.R.Shah) (K.L.Vyas) (R.R.Dhanani) (S.Z. Memon) Proprietor Partner Chairman & Managing Director Director M.No. 34994 M.No. 72043

Place : Mumbai

th

31

(Rehanuma Khan)

Company Secretary


CASH FLOW STATEMENT PURSUANT TO CLASUE 32 OF THE LISTING AGREEMENT

FOR THE YEAR ENDED 31ST MARCH, 2011. Rs. in Lacs

A. CASH FLOW FROM OPERATING ACTIVITIES Net Profit / (Loss) After tax Adjustment for:

Interest on Fixed Deposits, 6.65% FERT CO GOI SPL 2023 Bonds & Loans & Advances Depreciation Deferred Tax Income Interest/Finance Charges Paid Misc Expenses written off Loss/(Profit) on Sale of Vehicle

Operating profit before working capital changes Adjustment for:

Decrease/(Increase) in trade receivable & advances Decrease/(Increase) in Inventories

31.03.2011

3518.53

(86.58)

281.40 (0.59) 696.76 49.68 (0.11) 940.56

4459.09

(3720.29) 1101.82

31.03.2010

647.62

(64.66)

227.69 (7.45) 477.53 48.75 0.96

682.82 1330.44 7078.35

(6341.69)

Increase/ (Decrease) in trade & other payables

Cash generated from operations Net Cash flow from Operating Activities (A)

B. CASH FLOW FROM INVESTING ACTIVITIES Sale of Fixed Assets/Investments Purchase of Fixed Assets/Investments Interest on Fixed Deposits, 6.65% FERT CO GOI SPL 2023 Bonds & Loans & Advances Net Cash used in Investing Activities (B)

C. CASH FLOW FROM FINANCIAL ACITIVITIES Share Capital Issued Share Application Money Received Share Premium Received Increase/(Decrease) in Long Term Borrowing Increase/(Repayment) of Unsecured Loans Increase/(Decrease) in Working Capital Limits Miscellaneous Expenditure Incurred Interest/Finance Charges Paid Dividend on Equity & Redeemable Preference Shares & Tax Thereon Net Cash Flow From Financing Activities (C)

D. NET INCREASE/(DECREASE) IN CASH & CASH EQUIVALENTS E. CASH & CASH EQUIVALENTS- OPENING BALANCE F. CASH & CASH EQUIVALENTS - CLOSING BALANCE This is Cash Flow Statement referred to in our report of even date

825.73 (1792.74) 2666.35

0.75

(1678.29) 86.58

(1590.96)

-

-

- (2.87) 151.45

2098.38 (2.50)

(696.76) (388.12) 1159.58 2234.97 1028.15 3263.12

(2753.58)

(2016.92) (686.48)

4.37

(1006.22) 64.66

(937.19)

500

- 150

(241.59) (4.02) 677.49 (4.62)

(477.53) -

599.73

(1023.94) 2052.09 1028.15





32


SCHEDULES TO BALANCE SHEET (Rs.)

SCHEDULE 1: SHARE CAPITAL

AUTHORISED: (a) Equity Share 20000000 Equity Shares of Rs.10 each (Previous year 15000000 Equity Shares of Rs.10 each)

(b) Preference Share 5000000 8% Cumulative Redeemable Preference Shares of Rs. 10 each (Previous Year 5000000 8% Cumulative Redeemable Preference Shares of Rs. 10 each)

ISSUED, SUBSCRIBED AND PAID UP: (a) Equity Share

AS AT 31.03.2011

200000000.00

50000000.00

250000000.00

AS AT 31.03.2010

150000000.00

50000000.00

200000000.00

14438201 Equity Shares of Rs. 10 /- each Total (a) 144382010.00 144382010.00 (Previous Year 14438201 Equity Shares of Rs. 10 /- each

which includes 5000000 Equity Shares of Rs. 10/- each issued on preferential basis at a premium of Rs. 3.00 per share respectively per share issued during previous year) (b) Preference Share 5000000 8% Cumulative Redeemable Preference

Shares of Rs. 10 each Total (b) 50000000.00 50000000.00 (Previous Year 5000000 8% Cumulative Redeemable Preference Shares of Rs. 10 each)

Total (a+b)

SCHEDULE 1A: SHARE APPLICATION MONEY

Equity Share Balance as per last Balance Sheet Add:- Amount Received during the year Less:- Shares issued during the year

(Previous Year 5000000 Equity Shares of Rs. 10/- each issued on preferential basis at a premium of Rs. 3/- per share)

Less:- Amount Refunded Total (a)

194382010.00

- - -

- -

194382010.00

- 65460527.00 65000000.00

460,527.00

-

33



SCHEDULE 2: RESERVES & SURPLUS

(a) Share Premium Account Balance as per last Balance Sheet Add:- Amount Received during the year

(b) General Reserve Balance as per last Balance Sheet Add:- Amount transferred from Profit & Loss Account

(c )Profit & Loss account

Total (a+b+c)

SCHEDULE 3: SECURED LOANS Loans and Advances from Banks

Term Loans From Canara Bank !

AS AT 31.03.2011

88951208.00

- 88951208.00

- 8797000.00 8797000.00

625074716.48

722822924.48

15166927.00

AS AT 31.03.2010

73951208.00 15000000.00 88951208.00

-

-

-

320831350.88

409782558.88

25262405.00

From SIDBI # 9000000.00 25600000.00 Working Capital Facilities From IDBI Bank

Cash Credit $ 32328910.94 - Buyers Credit Loan $ 29933383.00 64718784.00

Working Capital Demand Loan $ - 60000000.00 From Canara Bank

Cash Credit $ 142025608.53 25056107.49 Foreign Currency Loan $ - 102780226.80 Buyers Credit Loan $ 55217985.00 -

From Karur Vysya Bank Cash Credit $ 100261856.07 -

Buyers Credit Loan $ 101952699.00 -

Working Capital Demand Loan $ - 81002994.00 From State Bank of Patiala

Cash Credit $ 81675574.00 - Other Loans and Advances

Term Loans a) Against Purchase of Land

From Gujarat Industrial Development Corporation b) Against Purchase of Vehicles

From TATA Motors Ltd. From ICICI Bank

Deferred Credit against purchase of Land From Gujarat Industrial Development Corporation

* @

**

74694.00

-

-

26600901.00

594238538.54

124466.00 106314.00 36193.00

- 384687490.29

34


SCHEDULES TO BALANCE SHEET

! Term Loan from Canara Bank is primarily secured by First pari-passu charge over fixed assets of the company situated at Kota (Rajasthan

!

! # # #

# Notes:

* *

* **

**

**

#$! #$! #$! $ $

$

$!

$! $!

$ #$! @

@

Interest accrued and due thereon Rs. 166927.00 (Previous year Rs.262405.00). Installments due within one year Rs.10000000.00 (Previous year Rs. 10000000.00). Term Loan from SIDBI is primarily secured by First pari-passu charge by way of equitable mortgage of immovable properties of the Term Loan from SIDBI is primarily secured by Second Charge by way of hypothecation on all the current assets of the Company, including stocks, inventory, book debts, claims, receivables and any other current asset, both present and future.

Interest accrued and due thereon Rs.73715.00 (Previous year Rs. 191474.00). Installments due within one year Rs.9000000.00 (Previous year Rs. 16600000.00). Term loan from GIDC, Baroda, is secured against lease hold land and building situated at C1-72, GIDC, Nandesari. Interest accrued and due thereon Rs. NIL (Previous year Rs.NIL). Installments due within one year Rs. 57056.00 (Previous year Rs. 49772.00). Deferred Credit against purchase of Land from GIDC, Bharuch, against purchase of lease hold land situated at D-2/CH-38,GIDC, Dahej. Interest accrued and due thereon Rs. NIL (Previous year Rs.NIL). Amount Payable in 12 Quarterly Installments of Rs. 2216741.00 each. (Previous year Rs. Nil). And also collaterally secured by (i) First pari-passu charge by way of hypothecation on all the movable assets of the company including Plant Machinery, Machinery Spares, tools & accessories, Office Equipment, Computers, Furniture and Fixtures etc. both present and future. (ii) First pari-passu charge by way of equitable mortgage of immovable properties of the company situated at Plot No. 74, 75 and 83 at GIDC, Nandesari, Baroda (Gujarat)

(iii) First pari-passu charge by way of equitable mortgage of immovable properties of the Company situated at F-220,F-221,F-222, F-224,F-225,F-226 & F-227, M.I.A., Madri, Udaipur (Rajasthan) (iv) Second pari-passu charge by way of equitable mortgage of immovable properties of the company situated at 19, Bhimpura Industrial Area, Jagpura, Kota (Rajasthan) (v) Second pari-passu charge by way of equitable mortgage of immovable properties of the company bearing Sy. No. 122 & 129, sitauted at Rasal (Pali) (Maharashtra) Working Capital limits from Consortium Member Banks are primarily secured by way of First Parri Passu Charge through Hypothecation of the Stocks of Raw materials, material in process & finished goods and hypothecation of book debts including the subsidy of the company

And also collaterly secured by way of Second pari-passu charge on the Land & Building, Plant & Machinery situated at Kota (Rajasthan) and Pali (Maharashtra). First pari-passu charge to the Consortium Member Banks on Term Deposit amounting to Rs. 63.00 Lacs (Previous Year 63.00

Lacs). Pledge of 6.65% FERT CO GOI SPL 2023 Bonds valuing Rs. 200 Lacs issued to the Company (Previous Year Rs. 200 Lacs). Interest

accrued and due thereon Rs. Nil (Previous year Rs.2196779.00). Also Secured by Personal Guarantee of Managing Director and Smt. Anisha Dhanani Vehicle Loans are secured against specific assets purchased under Hire Purchases Agreements and ownership of which shall be transferred on fulfillment of all the terms and conditions of respective hirepurchase agreement. Installments due with in one year Rs. Nil (Previous year Rs. 142507.00 ) Vehicle Loan amounting to Rs. Nil is in the name of Directors/Employees of the Company (Previous Year 0.36 Lacs).

(Rs.)

SCHEDULE 4: UNSECURED LOANS

From Other Companies From Subsidiary From Directors & their Relatives

35

AS AT 31.03.2011

- 9595573.27

17232536.99

26828110.26

AS AT 31.03.2010 1705907.45 9499655.27 477536.99

11683099.71


36


SCHEDULES TO CONSOLIDATED BALANCE SHEET

SCHEDULE 5 : FIXED ASSESTS

PARTICULARS

GROSS BLOCK

DEPRECIATION

NET BLOCK

AS AT

ADDITIONS

SALES/

AS AT

AS AT

FOR THE

SALES/

AS AT

31/03/2010

TRANSFER

3 1 / 0 3 / 2 0

31/03/2010

YEAR

TRANSFER

3 1 / 0 3 / 2 0

31/03/2011

AS

31/03/2010

AS

LEASEHOLD LAND

15440862.70

74,224,038.50

- 89664901.20

- -

- -

89664901.20

15440862.70

AGRICULTURAL LAND

- 6943518.00

- 6943518.00

- -

- -

6943518.00

-

FA C T O R Y B U I L D I

159265685.52

1 7 , 4 1 6 , 9 11 .

- 176682597.45

51774207.97

10,850,699.58

- 62624907.55

114057689.90

107491477.55

P L A N T & M A C H I N E

2 111 7 6 5 0 1 .

7,982,546.09

- 219159047.20

128424715.79

13,264,792.53

- 141689508.32

77469538.88

82751785.32

LABORATORY EQUIPMENTS

1333402.96

51,800.00

- 1385202.96

532049.32

11 7 , 11 4 .

- 649163.47

736039.49

801353.64

OFFICE EQUIPMENTS

5080893.78

128,423.00

- 5209316.78

3789620.43

187,893.61

- 3977514.04

1231802.74

1291273.35

COMPUTERS

2278919.33

413329.00

- 2692248.33

1436016.81

386221.14

- 1822237.95

870010.38

842902.52

FURNITURE & FIXTURES

6545188.94

1,057,772.00

- 7602960.94

3083830.40

724,606.44

- 3808436.84

3794524.10

3461358.54

VEHICLES

17794334.59

1 , 7 7 1 , 3 11 .

396,101.00

19169544.59

8851706.82

2,608,963.01

332,088.87

111 2 8 5 8 0 .

8040963.63

8942627.77

418915788.93

109989649.52

396,101.00

528509337.45

197892147.54

28140290.46

332,088.87

225700349.13

302808988.32

221023641.39

PROGRESS

CAPITAL WORKS IN

16919059.64

81,586,470.45

24,250,766.52

74,254,763.57

- -

- -

74,254,763.57

16,919,059.64

PREVIOUS YEAR

TOTAL:

355087010.32

435834848.57

1 6 11 2 9 4 2 4 .

1 9 1 5 7 6 11 9 .

80381586.13

24646867.52

435834848.57

602764101.02

176341936.67

197892147.54

22769375.48

28140290.46

1,219,164.61

332,088.87

197892147.54

225700349.13

237942701.03

377063751.89

160876679.04

237942701.03

1. Lease hold Land and Building includes Rs.24922580.27 (Previous year Rs.24922580.27) pending registration with appropriate authority.

3. Some of the vehicles are in the name of directors/employees.

4. Capital Work in Progress includes Advance given for Purchase of Land amounting to Rs.Nil (Previous Year Rs. Rs. 7243557.50)

contained in Allotment Letter dated 25-03-2011 on construction of Fertiliser Manufacturing Facility within a stipulated period of 3 years.

5. Lease Hold Land includes Land at Plot No. D-2/CH/38, having Licence to enterupon cum right for grant of Lease for a period of 99 years by GIDC on the fulfillment of term

s & condition

6. Capital Work in Progress includes Pre Operative Expenses amounting to Rs.465486.00 (Previous Year Rs. Nil)



AS AT AS AT 31.03.2011 31.03.2010

SCHEDULE 6 : INVESTMENTS LONG TERM INVESTMENTS A. Government & Other Securities - (Quoted at cost)

Nos.

6.65% FERT CO GOI SPL 2023 Bonds 2000 18125361.00 18122274.00 Units of Canara Robecco Mutual Fund 50000 500000.00 -

B. Trade Investments (Unquoted at cost & fully paid up)

Nos. F.V. Shares of a 100% subsidiary company,

Liberty Pesticides & Fertilizers Ltd. 750000 10.00 11250000.00 11250000.00

Shares of NECL 400 10.00 4000.00 4000.00 29879361.00 29376274.00

SCHEDULE 7: CURRENT ASSETS, LOANS AND ADVANCES

(a) INVENTORIES

(As taken valued & certified by the Management At Cost or net realisable value, whichever is lower) Stores & Spares Raw Material Packing Material Finished Goods Finished Goods (Trading) Fuel

(b) SUNDRY DEBTORS (Unsecured considered good unless otherwise stated) Debts outstanding for a period exceeding six months Considered Good Considered Doubtful Less-Provision for doubtful debts Other debts

(c) CASH AND BANK BALANCES Cash on hand With scheduled Banks In current accounts In fixed deposit /Margin money accounts

Includes interest accrued Rs. 2483075.58 (Previous Year Rs. 3910585) & Pledged with Banks

13223789.95

494267102.69 7338419.31

361022034.27 12708142.79 1795852.51

890355341.52

26049374.99

- 26049374.99

- 26049374.99

599883752.63 625933127.62 3214488.96

185877058.15

137220320.58

326311867.69

10647566.65 268521753.68

5545113.86 709916299.36

4563447.00 1342907.69

1000537088.24

4548340.20 7851128.79

12399468.99 7851128.79 4548340.20

274403478.40 278951818.60

3876270.46

15196246.86

83742809.00

102815326.32

37


SCHEDULES TO BALANCE SHEET

(d) LOANS & ADVANCES (Unsecured considered good unless otherwise stated) Advances recoverable in Cash or in kind or for value to be received Advance to Suppliers Security Deposits with Govt & Others

SCHEDULE 8: CURRENT LIABILITIES & PROVISIONS (a) CURRENT LIABILITIES

Interest accrued but not due Advance from customers Sundry Creditors for goods and expenses * Sundry Creditors for capital goods * Book overdraft Other

liabilities

(b) PROVISIONS Proposed Final Dividend Dividend on Preference Share Tax on Dividend (Net of Tax Paid on Interim Dividend Rs.34.32 Lacs(Previous Year Rs. Nil)) Income Tax (Net of Advance Payment of Rs.806.68 Lacs(Previous Year 206.42 Lacs)) * The Company has not received information from vendors regarding their status under the Micro, Small & Medium Enterprises Development Act, 2006 and hence disclosure relating to amount unpaid at the year end together with interest paid/payable under the Act

have not been given.

SCHEDULE 9 : MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted)

(a) Preliminary Expenses Balance As per Last Balance Sheet Add:- Expenses incurred during the Year Less:- Written off during the year

(b) Issue Related Expenditure Balance As per Last Balance Sheet Add:- Expenses incurred during the year Less:- Written off during the year

(c ) Deferred Revenue Expenditure Balance As per Last Balance Sheet Add: Incurred during the year Less: Written off during the year

AS AT 31.03.2011

54371012.36

150585833.22 20033253.29 224990098.87

- 19024698.45

641427286.39

4060738.59 587.86 141725926.02 806239237.31 8662921.00

4000000.00

2054242.00

108036891.00

122754054.00

462210.00

250000.00

234884.00

477326.00 193919.00

- 193919.00

-

4538536.00 -

4538536.00 -

(Rs.)

AS AT 31.03.2010

39615358.72

141018427.45 19308572.29

199942358.46

- 61892984.54

700023639.27 984610.00

- 67285430.96

830186664.77

-

-

-

16233408.00

16233408.00

142200.00

462210.00 142200.00 462210.00 387836.00

- 193917.00 193919.00

9077070.00 -

4538534.00 4538536.00

38


(Rs.)

SCHEDULES TO PROFIT AND LOSS ACCOUNT SCHEDULE 10: OTHER INCOME

Interest on Fixed Deposits Foreign Exchange difference Interest on Security Deposits Subsidy on Freight Profit on Sale of Vehicle Interest on loan Rent Interest on 6.65% FERT CO GOI SPL 2023 Bonds Stores Adjustment on Physical Verification Miscellaneous Receipts

SCHEDULE 11: INCREASE/(DECREASE) IN STOCKS

Opening stock of Finished Goods Closing

stock of Finished Goods Net Increase/(Decrease) of Stock of Finished Goods

SCHEDULE 12: RAW MATERIAL CONSUMED

Opening Stock Purchases Cost of SSP Consumed for NPK Manufacturing Cost of Raw Material Transferred from Trading (As per Contra in Schedule-14) Less: Cost of Raw Material Transferred to Trading (As per Contra in Schedule-14) Less: Cost of Goods swept due to Flood Less : Closing stock

SCHEDULE 13: PACKING MATERIAL CONSUMED

Opening Stock Purchases Less: Closing Stock

SCHEDULE 14: COST OF GOODS TRADED Opening stock Purchases Earlier Year's Sales Return Cost of Raw Material Transferred (As per Contra in Schedule-12) Less: Material transferred for Processing Less: Cost of Goods Transferred to Raw Material (As per Contra in Schedule-12) Less: Closing stock

SCHEDULE 15: MANUFACTURING EXPENSES Repairs, Maintenance & Stores Consumed Factory light, Water & Generator expenses Fuel consumed Laboratory expenses

Insurance expenses Loader & Shifting expenses Other Manufacturing expenses

39

YEAR ENDED 31.03.2011 6621387.00 24508907.28 206004.00

818795.00 10987.87

636272.00

114000.00 1400688.58

1855.06 499539.88

34818436.67 709916299.36

361022034.27 (348894265.09) 268521753.68

1983718139.60 98610.50

- 2252338503.78 80322045.91

- 494267102.69 1677749355.18

5545113.86 96193947.55 101739061.41 7338419.31 94400642.10 4563447.00

112193117.42 -

80322045.91 197078610.33

-

-

- 12708142.79 184370467.54 63643704.87

54537424.96

31126868.70 1065756.58 821239.00 3405481.47 5502440.40

160102915.98

YEAR ENDED 31.03.2010 5358667.00

51715813.63 185761.00

471250.00 -

- 114000.00

1107537.11

3530.07 139552.30

59096111.11

145117383.36 709916299.36 564798916.00 167243939.41

1633491466.21 736000.00

4152747.72 1805624153.34 19055272.00

531740.00 268521753.68

1517515387.66

4598429.74 81054110.82 85652540.56 5545113.86

80107426.70 39665254.00

376909305.44 676924.00 19055272.00 436306755.44

- 4152747.72 4563447.00

427590560.72 46744318.87

47471519.41

20814499.91 808600.15

860120.00 1494865.02 5384152.37

123578075.73


(Rs.)

SCHEDULES TO PROFIT AND LOSS ACCOUNT SCHEDULE 16: PERSONNEL COST

Salaries, Wages & Bonus Contribution to ESI

Contribution to PF Gratuity House Rent Staff & Labour Welfare

SCHEDULE 17: SELLING & DISTRIBUTION EXPENSES

Freight outward Rebate, Cash Discount and Others (net) Advertisement Sales Promotion Godown Rent

SCHEDULE 18: ADMINISTRATION & GENERAL EXPENSES

Office Rent & Maintenance Guest House Expenses Travelling Expenses Conveyance Printing and Stationery Trunks & Telephones Membership & Subscription Fees Legal & Licence Fee Professional & Consultancy Fees Auditors' Remuneration Rates & Taxes Miscellaneous Expenses ISO Fees Postage & Telegram Security, Watch & Ward Sales Tax, Entry Tax & VAT VAT, PF & Service Tax Penalty Interest on VAT, ESIC & PF Professional Tax Income Tax Appeal Fee Listing Fee Donation


105148284.00 866870.00

4166411.00

3018016.00

7605535.00

3092745.09 123897861.09 267982657.82 95946769.69 204350.00

3358076.76

5625097.20 373116951.47

2344079.47 734439.00

8140346.63

3049839.63

1572513.76

2148168.36 128046.00

871578.00 2571750.00 330300.00 3870915.00 475817.11

- 431179.52 4774158.00 20100719.49

68627.00

63648.00 7400.00

2000.00 33090.00

41976.00


67743100.70 396084.00

2972369.00 161798.00

6228238.00 2659949.75

80161539.45

221983473.68 11200185.69

238151.00

1472719.82 3124539.50

238019069.69

1839418.43 781232.00

7620829.37

2105302.75

1437508.89

2079447.28 144406.00

1122348.00

1980823.00 290300.00

1014537.00 270087.72 77043.00

427280.72

3475884.00

6694712.28 408672.00

291414.00 -

2000.00 33090.00

140998.00

Bad Debts Less: Provision for Bad Debts Miscellaneous expenditure written off Loss on sale of Vehicles Loss due to Flood/ Cyclone Sundry Balances Written Off Service Tax & Excise Duty

7851128.79 7851128.79

- 4874897.00

-

-

- 11087344.48 67722832.45

-

4874651.00 95628.39

958057.00

306852.07 8428008.50

46900531.40

40


SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 19 : SIGNIFICANTACCOUNTING POLICIES

CONVENTION To prepare financial statements in accordance with applicable Accounting Standards in India. A summary of accounting policies, which have been applied consistently, is set out below. The financial statements have also been prepared in accordance with relevant presentational requirement of the Companies Act, 1956.

BASIS OFACCOUNTING The financial statements have been prepared under the historical cost convention and on accrual basis and on going concern concept.

USE OF ESTIMATES The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

FIXEDASSETS To state Fixed Assets at cost of acquisition inclusive of inward freight, duties and taxes and incidental expenses related to acquisition. In respect of major projects involving construction/fabrication, related pre-operational expenses form part of the value of the assets capitalized. Expenses capitalized also includes applicable borrowing costs. To adjust the original cost of fixed assets acquired through foreign currency loans at the end of each financial year by any change in liability arising out of expressing outstanding foreign loan at the rate of exchange prevailing at the date of Balance Sheet. To capitalize software where it is expected to provide future enduring economic benefits. Capitalization costs includes license fees and cost of implementation/system integration services. The costs are capitalized in the year in which the relevant software is implemented for use. All up-gradation/enhancements are generally charged off as revenue expenditure unless they bring similar significant additional benefits. No amortization is provided in the Accounts in respect of leasehold land in view of the long term tenure, which is akin to ownership. Depreciation on Fixed Assets is provided for on Written Down Value Method at the rates and in the manner specified in the Schedule XIV of the Companies Act, 1956.

INVESTMENTS To state current investments at lower of cost and fair value, and long term investments are stated at cost. Where applicable, provision is made where there is a permanent fall in valuation of long term investments.

CURRENTASSETS Inventories are valued as: (a) Stores and Spares : at lower of cost or net realizable value (b) Raw Materials : at lower of cost or net realizable value (c) Work in process : at lower of cost or net realizable value (d) Finished Goods : at lower of cost or net realizable value

Cost is arrived at on First in First Out basis. Cost comprises expenditure incurred in normal course of the business in bringing such inventories to its location and includes, where applicable, appropriate overheads based on normal level of activities. Obsolete, slow moving and defective inventories are identified at the time of physical verification of inventories and, where necessary, provision is made for such inventories.

FOREIGN CURRENCYTRANSACTIONS (a) Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the

date of the transaction. (b) Monetary items denominated in foreign currencies at the year end are restated at the year end rates. In

case of items which are covered by forward exchange contracts, the difference between the year end rate and the rate on the date of the contract is recognized as exchange difference and the premium paid on forward contracts is recognized over the life of the contract.

41


SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 19 (Contd.)

(a) Non-monetary foreign currency items are carried at cost. (b) In respect of branches, which are integral foreign operations, all transactions are translated at rates

prevailing on the date of transaction or that approximates the actual rate on the date of transaction. Branch monetary assets and liabilities are restated at the year end rates.

(c) Any income or expense on account of exchange difference either on settlement or on translation is recognized in the profit and loss account except in cases where they relate to acquisition of fixed assets, in which case they are adjusted to the carrying cost of such assets.

INCOME Sales comprises sale of goods and services. Revenue in respect of purchase/sale of product and scrap is recognized at the point of receipt/despatch from/to parties at/from plant and warehouses. Interest on Fixed Deposits with banks and other miscellaneous income are also accounted for on the accrual basis except interest accrued on NSC, dividend and interest if any arising on income tax, sales tax and excise duty refunds.

BENEFITS TO WORKMEN Liabilities in respect of retirement benefits are provided for by monthly payments to pension and provident funds under the Employees' Provident Funds (and Miscellaneous Provisions) Act, 1952 which are charged against revenue. Benefit in terms of workmen demand pending settlement, accumulated leave, medical reimbursement and leave travel concession are accounted, when paid and bonus to employees, is provided for on accrual basis. Gratuity liabilities are determined as per the actuarial valuation done using the projected unit credit method. Gratuity Scheme in respect of the employees of the company is administered through Life Insurance Corporation of India (LIC). Annual contribution as determined by the LIC are charged to the Profit & Loss Account. The additional liability, if any, arising out of the difference between the actuarial valuation as at the Balance Sheet date and the fund balance is accrued and provided for at the year end.

TAXES ON INCOME To provide and determine current tax as the amount of tax payable in respect of taxable income for the period. To provide and recognize deferred tax on timing differences between taxable income and accounting income subject to consideration of prudence. Not to recognize deferred tax assets on unabsorbed depreciation and carry forward of losses unless there is virtual certainty that there will be sufficient future taxable income available to realize such assets.

IMPAIRMENT OFASSETS Impairment is ascertained at each balance sheet date in respect of company's fixed assets. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount. The recoverable amount is the greater of the net selling price and value in use. In assessing value and use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

ACCOUNTING FOR PROVISIONS, CONTINGENT LIABILITIES & CONTINGENTASSETS Provisions are recognized in terms of Accounting Standard 29-"Provisions, Contingent Liabilities and Contingent Assets" issued by The Institute of Chartered Accountant of India, when there is a present legal or statutory obligation as a result of past event where it is probable that there will be outflow of resources to settle the obligation and when a reliable estimate of the amount of the obligation can be made. Contingent Liabilities are recognized only when there is a possible obligation arising from past events due to occurrence or non occurrence of one or more uncertain future events not wholly within the control of the company or where reliable estimate of the obligation can not be made. Obligations are assessed on an ongoing basis and only those having largely probable outflow of resources are provided for. Contingent Assets are not recognized in the financial statements.

42


SCHEDULES TOACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 19 (Contd.)

CLAIMS To disclose claims against the company not acknowledged as debts after a careful evaluation of the facts and legal aspect of the matter involved. MISCELLANEOUS EXPENDITURE -Preliminary Expenses including issue expenses are amortized over a period of five years. -Payment made to Rajasthan State Mines & Minerals Limited, on account of dues of Hindustan Farms & Fertilizers Co. Ltd., for ensuring regular supply of rock phosphate from Rajasthan State Mines & Minerals Limited, is treated as Deferred Revenue Expenditure and is amortized over a period five years. SCHEDULE - 20 : NOTES FORMING PART OF ACCOUNTS

1. Contingent liabilities not provided for: (a) Bills discounted with bank outstanding - Rs. Nil (Previous year Rs. Nil). (b) Letter of Credits outstanding - Rs.6418.76 Lacs (Previous year - Rs. 4207.16 Lacs) and Margin

Money given there against Rs. 1345.90 Lacs (Previous Year - Rs. 797.03 Lacs). (c) Guarantees given by Company's Banker on behalf of the Company -Rs.70.40 Lacs (Previous year

Rs. 46.70 Lacs). (d) The Company has executed bonds in favour of Excise Department in connection with purchases

of raw material without levy of excise - Rs.184.80 Lacs ( Previous year Rs. 182.00 Lacs). (e) The company purchased manufacturing facilities of fertilizers from Liberty Pesticides & Fertilizers

Ltd (A subsidiary Company) on 1.10.1997. Registration of transfer is pending as the company disputed that the registration of property in the name of company, is not liable for the payment of stamp duty under Rajasthan Stamp Law (Adaption) Act, 1952 read with section 9 (1) (a) of Indian Stamp Act, 1899 and accordingly preferred writ before hon'ble High Court of Rajasthan. Likely amount of stamp duty, if any payable, will be Rs.26.85 Lacs (Previous year 26.85 Lacs).

(f) Demands of Sales Tax Authorities not acknowledged by the Company and contested/appealed, Rs.13.02 Lacs (Previous Year Rs. 13.02 Lacs). Amount paid there against as the matter of prudence Rs.2.77 Lacs (Previous Year- Rs.2.77 Lacs).

(g) Demand of Income Tax not acknowledged by the company and contested/appealed Rs. 03.50 Lacs (Previous year - Rs. 03.50 Lacs). Amount paid there against as the matter of prudence Rs. 03.50 Lacs (Previous year -Rs. 0.70 Lacs).

(h) Demand of Differential Customs Duty on Import of Rock Phosphate not acknowledged by the company and contested/appealed Rs. 344.16 Lacs (Previous year - Rs. Nil).

2. Claims against the company not acknowledged as debts:- Claims on account of rebate, discount & freight - Rs.27.95 Lacs (Previous year- Rs. 27.95 Lacs).

3. Estimated capital commitments not provided for - Rs.600.00 Lacs (Previous year Rs. 250.00 Lacs). 4. Depreciation for the period has been calculated at the rates and in the manner specified in Schedule XIV

to the Companies Act, 1956 vide notification No. GSR 756 (E) dated 16.12.93 of the Department of Company Affairs, Govt. of India. For the purpose of determining the appropriate depreciation rates, Plant and Machinery falling in the category of continuous process plants has been identified on the basis of technical opinion obtained by the company. Extra shift depreciation, wherever applicable is calculated on actual shift basis in respect of each plant/unit.

5.

6.

No provision has been made in respect of : - fall in the value of long term investment in shares of subsidiary company and others, since in the opinion of the management book value of the shares is sufficient to cover temporary fall in the value of shares. Further, to inform that investment made is in the nature of trade investment. - The Company has not received information from vendors regarding their status under the Micro, Small & Medium Enterprises Development Act, 2006 and hence disclosure relating to amount unpaid at the year end together with interest paid/payable under theAct have not been given. Additional information pursuant to the provisions of Paragraphs 3, 4, 4 - A and 4 -C of Part II of the Schedule VI of the Companies Act, 1956.

43

23rd Annual Report 2010-11 Liberty Phosphate Ltd. SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 20 (Contd.)

a) i

Capacity

- Licensed- Single Super Phosphate * -

Installed - Single Super Phosphate # Unit - Baroda (Guj.) Unit - Udaipur (Raj.) Unit - Kota (Raj.)

Unit - Pali (Mah.)

31.03.2011 N.A

100000 MT

264000 MT

132000 MT 66000 MT

31.03.2010

N.A

100000 MT

165000 MT

132000 MT 66000 MT

ii - Licensed- MGSO4 * N.A N.A

- Installed MGSO4 #

Unit - Baroda (Guj.) 5400 MT 5400 MT

* Licensed capacity is not applicable in view of company's product has been de-licensed as per new liberalized licensing policy announced by the Govt. of India. However, capacities have been registered with the Secretariat of IndustrialApprovals.

# Installed capacities are certified by the Directors and accepted by the Auditors as correct, being a technical matter.

b) Production/Purchase and Sales Production /Purchases Sales*

Year Ended Year Ended Year Ended Year Ended 31-03-2011 31-03-2010 31-03-2011 31-03-2010

MT Rs. in MT Rs. in MT Rs. in MT Rs. In Lacs Lacs Lacs Lacs

Manufactured SSP/GSSP 373454 - 340231 - 439102 33684.80 240944 15556.84

- - - - 25 - 230 7.36 NPK 8220 - 16127 - 8066 581.46 14896 1032.15 Magnesium Sulphate 4342 - 1371 - 3836 311.37 1139 74.44 Traded goods

SSP/GSSP - - 12927 425.14 - - 12927 433.14 Water Soluble Fertilisers Mono Ammonium Phosphate - - - - - - - - NPK 19:19:19 - - - - - - 2 1.18 Others Rock phosphate 8605 424.54 44561 3245.04 13164 678.40 44561 2693.78

4559++ 257.69 - - - - - - Mono Ammonium Phosphate 5291 501.83 900++ 81.90 4805 460.46 900 81.90

373++ 38.68 - - - - - - HDPE Bags - - - - Muriate of Potash(MOP) 584++ 25.73 1742++ 73.23 584 25.17 1996 105.51 Calcium Nitrate - - - - - - - -

Potassium Sulphate - - - - - - 2 1.22 Potassium Nitrate - - - - - - 2 1.67 Calcite - - - - - - - - Di Ammonium Phosphate 304 28.95 300 28.35 4023 390.87 3872 355.19

3719++ 355.63 373++ 35.42 - - 300@ - Gypsum - - 320^ 6.77 - - 360 6.77 Urea 3369++ 125.49 - - 3369 116.99 - - GTSP 2190 166.61 - - 2190 168.25 - - Sulphuric Acid/Spent Acid - - 7919 65.99 - - 4360 61.36

- - - - - - 3422@ - Magnesium Sulphate - - - - - - 16@ -

Others - - - 4.57 - - - -

Total 1925.15 3966.41 36417.77 20412.51

44


SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 20 (Contd.) * Sales is net of returns but including of excess/shortage. @Transferred to Raw Material/Processing Material ++ Transferred from Raw Material Stock ^ Earlier Years Sales Return c) Closing Stock

Year Ended Year Ended Year Ended 31/03/2011 31/03/2010 31/03/2009

MT Rs.in Lacs MT Rs. in Lacs MT Rs. in Lacs Manufactured SSP/GSSP -factory 44698 2229.38 44590 2164.21 26129 1069.41

-field Warehouses 22009 1215.26 87790 4795.97 7194 329.86 N.P.K Mixed Fertilizers 2152 120.42 1998 120.94 767 51.90 MGSO4 -Factory 699 42.62 184 14.24 - -

-field Warehouses 39 2.54 48 3.80 - - Traded Goods SSP/GSSP - - - - - Water Soluble Fertilisers Mono Ammonium Phosphate - - - - - - NPK 19:19:19 5 1.38 5 1.38 7 1.83 Others Rock Phosphate - - - - - Mono Ammonium Phosphate 859 81.45 - - - - Muriate of Potash - - - 254 29.24 Calcium Nitrate - - - - - Potassium Sulphate 1 0.25 1 0.25 3 1.47 Potassium Nitrate 2 1.10 2 1.10 4 2.90 Ammonium Sulphate 97 7.28 97 7.28 97 7.28 KMAG 18 3.60 18 3.60 18 3.60 Dolomite Powder - - - - - - Calcite 32 0.71 32 0.71 32 0.71 Di Ammonium Phosphate - - 3499 318.86 Gypsum 267 0.70 267 0.70 307 0.82 GTSP 360 28.14 360 28.14 360 28.14 Magnesium Sulphate - - 16 1.80 Sulphuric Acid 137 2.47 137 2.47 - - Total 3737.30 7144.79 1847.82

d) Raw Material consumed

Year Ended Year Ended 31-03-2011 31-03-2010

MT Rs. in Lacs MT Rs. in Lacs Rock Phosphate # 215353 12721.46 193108 12793.89 Sulphuric/Spent Acid # # 151830 3578.00 135538 1541.95

Urea 3097 28.65 5631 271.29 Di Ammonium Phosphate 1024 96.22 2651 250.81 Muriate of Potash 1330 58.90 2620 117.06 Single Super Phosphate 998 29.59 1841 77.33 Mono Ammonium Phosphate 380 38.81 796 69.82

Dolomite Powder - - 2190 15.75 Gypsum/Filler 1087 6.58 209 3.28 Magnesium Oxide 1029 119.28 306 33.97 Total 16777.49 15175.15 # includes 302 MT amounting to Rs. 3.03 Lacs consumed for production of NPK (Previous Year 190 MT Rs 3.05 Lacs)

## includes 2508 MT amounting to Rs.61.33 Lacs consumed for production of MGSO4 (Previous Year 643 MT Rs 4.74 Lacs)

45

23rd Annual Report 2010-11 Liberty Phosphate Ltd. SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 20 (Contd.) e) Value of Imported and Indigenous material consumed :

Year Ended 31-03-2011


Rs. in Lacs % of total Rs. in Lacs % of total consumption consumption

i) Raw Material Imported (Cost to the Company) 5151.89 30.71 6626.46 43.67 Indigenous 11625.60 69.29 8548.69 56.33 Total 16777.49 100.00 15175.15 100.00

ii) Components, Spare parts & stores Imported - - - - Indigenous 478.21 100.00 317.81 100.00 Total 478.21 317.81 100.00

f) CIF value of Imports (on accrual basis): Raw Material Traded Goods

g) Expenditures in Foreign Currency Travelling

h) F.O.B. value of Earnings in foreign exchange (On accrual basis) i) Managerial Remuneration: (a) Remuneration to Managing Director/

Executive Directors (included under the head "Personnel Cost") Salaries and allowances Contribution to Provident Fund Commission to Managing Director Other Perquisites Total


(Rs. in Lacs) 6775.26 684.97

1.43 25.75 80.36 8.13

224.22 312.71


(Rs. in Lacs)

7863.80

3241.79

2.53 58.09

25.89 02.33 14.40 -

42.62

(b) Computation of net profit in accordance with section 349 of the Companies Act, 1956:

Profit before Taxation Add: Depreciation as per Accounts Managerial Remuneration (Excluding Contribution to Provident Fund) Less: Depreciation as per Section 350 of Companies Act, 1956 Net

Profit for the Year Salaries, Perquisites and Commission to Managing Director calculated @5% of the net

Profit Rs. 287.34 Lacs (Previous Year Rs. 28.88 Lacs) Less: Salaries & Perquisites paid to Managing

Director eligible for Commission. Commission Payable

46

5442.31

281.40

304.58 6028.29 281.40 5746.89

287.34

63.12 224.22

1011.51

227.69 40.29 1279.49 227.69 1051.80

28.88

14.48 14.40


j) Auditors' remuneration: I. Statutory Auditors: a) Statutory Audit b) Tax Audit c) Taxation d) Certification e) Company law matters f) Other Services Total II. Cost Auditors

a) Cost Audit Fees*

1.86 0.25 0.25

0.25 0.25 0.24

3.10 0.20

1.46 0.25 0.25 0.25 0.25 0.24

2.70 0.20

*(Including Service Tax & Out of Pocket Expenses) 7. Interest and financial charges (net) is on bank and other accounts Rs.648.26 Lacs (previous year Rs.

391.04 Lacs) and on fixed loan Rs.48.50 Lacs (previous year Rs. 86.49 Lacs).

8. In the opinion of the Directors, Current Assets, Loans and Advances have the value at which they are

stated in the Balance Sheet, if realized in the ordinary course of business. Further, Directors are of the opinion that all the

liabilities have been duly reflected in the Balance Sheet and nothing is remained to be disclosed for. Sundry Debtors,

Creditors and Advances are subject to reconciliation and confirmation.

9. In view of mandatory Accounting Standard (AS) -15 "Accounting for Retirement Benefits in

the Financial Statements of Employers" is dealt as under:

- Liability in respect of provident fund are provided for by monthly payments to pension and provident

fund under the Employees' Provident (and Miscellaneous Provisions) Act, 1952, which are charged against revenue.

- Gratuity liabilities are determined as per the actuarial valuation done using the projected unit credit

method.

- Gratuity Scheme in respect of the employees of the company is administered through Life Insurance

Corporation of India (LIC). Annual contribution as determined by the LIC are charged to the Profit & Loss Account. The

additional liability, if any, arising out of the difference between the actuarial

valuation as at the Balance Sheet date and the fund balance is accrued and provided for at the year end.

- Employees are entitled to accumulate their privilege leave within specified limits and can claim

encashment thereof while in service or on separation or on superannuation or otherwise. This is not treated as specific

retirement benefit and the cost thereof is accounted for in the year in which the claims are received.

10. In terms of Accounting Standard (AS) - 22 'Accounting for Taxes on Income' issued by the Institute of

Chartered Accountants of India, which is mandatory in nature, the deferred tax and deferred tax

liability/assets resulting from timing difference between the Book Profit and Tax Profit are as under:

Particulars

Deferred Tax Liabilities : On account of Timing Difference in - a) Depreciation b) Deferred Revenue Expenditure Carried

Forward

TOTAL Deferred Tax Assets : On account of Timing Difference in- a) Provision for doubtful advances

TOTAL Net Deferred Tax (Liability)/Assets

Credited / (Debited to Profit & Loss Account)

Balance as at 31st March, 2011 Rs. in Lacs

77.46 -

77.46

--

(77.46)

Arising During the year Rs. in Lacs

11.85

15.43 27.28

(26.69)

(26.69) 0.59

Balance as at 31st March, 2010 Rs. in Lacs

89.31

15.43 104.74

26.69

26.69 (78.05)

47


11. Related party disclosure under Accounting Standard (AS) -18

a) The list of the related parties as identified by the management are as under:

i) Enterprises over which Key Management Personnel with relatives, is able to exercise

significant influence:

1. Tungabhadra Fertilizers & Chemicals Co. Ltd.

2. Liberty Pesticides & Fertilizers Limited (A wholly owned subsidiary).

3. A.R. Exports.

4. Liberty Urvarak Limited.

ii) Key Management personnel of the Company:

Directors of the Company

iii) Relative of Key Management personnel:

1. Smt. A.R. Dhanani 2. Smt. Suchitra Dhanani

The following transaction were carried out with related parties: S.No.

Particulars

Key management

personnel and their

relatives

Rs. In Lacs

Enterprises over KMP

with their relative, is

able to exercise

significant influence

Rs. In Lacs

31.03.11 31.03.10 31.03.11 31.03.10

1. Balance outstanding against purchases & sales

and advances there against,

- Debit - -

- Credit 214.08 14.40 756.95 1903.37

2. Balance outstanding as Investments - - 112.50 112.50

3. Payment made on their behalf 128.49 250.46 13660.62 7586.11

4. Payment made on our behalf 188.84 3 13.98 11802.87 6624.22

5. Purchases of Assets - - - -

6. Service/Rent/Consultancy/Finance Charges - - 1.14 -

7. Remuneration/Commission to the Directors 305.90 42.62 - -

8. Sale of goods - - 462.39 834.71

9. Purchase of goods - - 1175.82 868.63

10. Deposits against House 109.43 113.24 - -

11. Guest House Rent 4.80 4.10 - -

12. Unsecured Loans 168.00 0.44 100.29 99.33

48


SCHEDULES TO ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2011 SCHEDULE 20 (Contd.) 12. Earning/(Loss) per share (EPS) is calculated as under:


a) Numerator:

Year Ended

31-03-2010

Net Profit/(Loss) before tax Excess/(Short) Provisions Prior Period Income/(Loss) Deferred Tax (Liability)/Asset Less: Provision for Taxation Excess/(Short) Provisions of Earlier years' Income tax Preference Dividend & Income Tax Thereon (Including Arrears of Earlier Years) Net Profit/(Loss) attributable to equity share holders

b) Denominator: Number of Equity shares Weighted average number of equity shares outstanding during the year

c) Nominal value of Equity Shares (in Rs.) d) Earning/(Loss) per share

13. Segment Reporting:

5429.13 16.37

(3.19) 0.59 1887.05 (37.33) (186.42) 3332.10 14438201

14438201

10/- 23.08

814.86 192.41 4.24 7.45

(368.75) (2.59)

(136.69) 510.93

14438201

13301215

10/-

3.84

That the Board of Directors, is of the opinion that the company is engaged in manufacture & sale of Fertilizers namely Single

Super Phosphate, NPK Mixture Fertilizers & MGSO4 and accordingly dealing in same segment namely Chemical

Fertilizers. Likewise, the manufacturing and marketing operations of the company are also confined only in the India. As

such, no segment is formed and accordingly no segment reporting is done in terms of the requirement of Accounting

Standard

(AS-17) "Segment Reporting" issued by the Institute of Chartered Accountants of India for the year

ended 31st March, 2011.

14. Impairment of Assets : That the Board of Directors, is of the opinion that the discounted net future generation from the Assets in use & shown in

the schedule of Fixed Assets, is more than the carrying amount of Fixed Assets in Balance Sheet, as such, no provision for

Impairment of Assets is required to be made in terms of the requirement of Accounting Standard (AS-28) "Impairment of

Assets" issued by the Institute of Chartered Accountants of India for the year ended 31st March'2011.

15. In the opinion of Board of Directors there exists adequate accounting & internal control system

designed to prevent and detect fraud or errors and in the opinion of Board of Directors that any uncorrected

misstatements resulting from either fraud or errors are in the managements opinion immaterial both individually &

aggregate in the Financial statements.

16. Previous year figures have been regrouped and rearranged, wherever necessary, to confirm to this

year's classification.

49


17. STATEMENT PURSUANT TO PART IV OF SCHEDULE VI TO THE COMPANIES ACT, 1956 BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE I. Registration Details:

Registration No State Code Balance Sheet Date

II. Capital raised during the year (Amount Rs. in thousand) Public Issue Right Issue Bonus

Issue Private Placement (on Preferential Basis, including share premium )

III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousand) Total Liabilities Total Assets Sources of Funds Paid up Capital Share Application Money Reserves & Surplus Secured Loans Unsecured Loans Deferred Tax Liability

Application of Funds Net Fixed Assets Investments Net Current Assets Miscellaneous Expenditure

IV. Performance of the Company (Amount in Thousands) Turn Over (including Other Income) Total Expenditure (Net of Decrease in Stock of Finished Goods) Operating Profit /(Loss) Excess/(Short) Provisions of Earlier Years Prior Period Income/(Loss) Profit /(Loss) before Tax Provision for Taxation Deferred Tax Assets/( Liability) Excess/(Short) Provisions of Tax of Earlier Years Profit /(loss) After Tax Earning per Share (Rs)

Rate (%) (Includes Interim Dividend of 6%)

V. Generic Names of the Three Principal Products of the Company Item Code No. Product Description

Signatures to Schedules 1 to 20 As per our Report attached

9543 04

31/03/2011

NIL

NIL

NIL NIL

1546017

1546017 194382

- 722823

594238 26828

7746

377064 29879

1138597 477

3676694

3133781 542913

1637

(319)

544231 (188705)

59 (3732) 351853 23.08

12.00

310310

Single Super Phosphate NPK Mixture Fertiliser MGSO4





50


STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956 RELATING TO SUBSIDIARY COMPANY

1. Name of the Subsidiary Company : Liberty Pesticides & Fertilizers Limited 2. Financial Year of the Subsidiary : The Financial Year of the Subsidiary Company

closed on 31ST March, 2011.

3. Issued, Subscribed and Paid-up Capital of the : 7,50,000 Equity Shares of Rs. 10/-each. Subsidiary Company as on 31st March, 2011.

4. Extent of Interest of Liberty Phosphate Ltd.(LPL) : in Subsidiary as on 31st March, 2011.

5. Net aggregate amount of Profits/(Losses) of the : Subsidiary so far as it concerns the Members of LPL and is not dealt with in the Accounts of LPL For the Financial Year and Previous Financial Years.

6. Net aggregate amount of Profits/(Losses) of the : Subsidiary so far as it concerns the Members of LPL and is dealt with in the Account of LPL for the

Financial Year or Previous Financial Years.

7,50,000 Equity Shares of Rs. 10/-each.(100%)

For the Current Financial Year : Rs. (0.35) Lacs. For the Previous Financial Year: Rs.0.55 Lacs

Nil for Previous & Current Financial Year.

7. As the end of the Financial Year of the Subsidiary ended 31st March, 2011 coincides with the end of the

Financial Year of the Holding Company, Section 212(5) of the Companies Act, 1956 is not application.

For and on behalf of the board

Place : Mumbai

Date : 29th July, 2011

(R. R. Dhanani) (S. Z. Memon)

Chairman & Managing Director Director

(Rehanuma Khan)

Company Secretary

51

23rd Annual Report 2010-11 Liberty Phosphate Ltd. Information pursuant to direction u/s 212(8) of the Companies Act, 1956

2010-11 2009-10

Capital 75.00 75.00

Reserves 144.60 144.95

Total Assets 223.60 237.56

Total Liabilities 223.60 237.56

Investment (other than investment in subsidiaries) Nil Nil

Turnover 11.66 71.24

Profit Before Taxation (1.05) 2.23

Provision for taxation - 0.35

Profit After Taxation (0.35) 0.55

Proposed Dividend Nil Nil

Place : Mumbai Date : 29th July, 2011

(R. R. Dhanani)

Chairman & Managing Director

For and on behalf of the board

(S. Z. Memon)

Director

(Rehanuma Khan)

Company Secretary

52


AUDITORS' REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS

To,

The Board of Directors, Liberty Phosphate Limited

We have examined the attached Consolidated Balance Sheet of Liberty Phosphate Limited (hereinafter called

"Company") and it's wholly owned subsidiary Liberty Pesticides & Fertilizers Limited, as at 31st March, 2011

(hereinafter individually called "Subsidiary" & along with the Company as "Group") the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statements for the year ended on that date. These financial statements are the responsibility of the Company's Management. Our responsibility is to express an opinion on the financial statements based on our audit.

We have conducted our audit in accordance with generally accepted auditing standards in India. These

standards require that we plan and perform the audit to obtain reasonable assurance, whether the financial statements are prepared, in all material respects, in accordance with an identified financial reporting frame work and are free of material mis-statements. An audit includes examining on test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statements. We believe that our audit provides a reasonable basis for our opinion.

We did not audit the financial statements of Liberty Pesticides & Fertilizers Limited, whose financial

statements reflect total assets of Rs.219.60 Lacs (Previous Year - Rs. 219.95 Lacs) as at 31st March, 2011 and

total revenue of Rs. 11.65 Lacs (Previous Year - Rs. 71.24 Lacs) for the year ended on 31st March, 2011. These financial statements have been audited by other auditor, whose report has been furnished to us, and in our opinion, so far as it relates to the amounts included in respect of the subsidiary, is based solely on the report of the other Auditor.

We report that the Consolidated financial Statements have been prepared by the Company, in accordance with

the requirements of Accounting Standards (AS) 21 - Consolidated Financial Statements and Accounting

Standard (AS) 23 - Accounting for investment in Associates in Consolidated Financial Statements, both issued by the Institute of Chartered Accountants of India, and on the basis of the separate audited financial statements of the Company, and it's subsidiary.

On the basis of the information and explanations given to us and on the consideration of the separate audit

reports on individual audited financial statements of the Company, and it's subsidiary, we are of the opinion that the Consolidated Financial Statements give true and fair view in conformity with the Accounting Principles generally accepted in India :

a)

b)

c)

In the case of Consolidated Balance Sheet, of the Consolidated State of Affairs of the Group as at 31st

March, 2011.

In the case of the Consolidated Profit and Loss Account, of the Consolidated Results of the

operations of the Group for the year ended on that date; and

In the case of the Consolidated Cash Flow Statement, of the Consolidated Cash Flows of the Group for the year ended on that date.

For V. Shah & Associates, For K.L.Vyas & Company, Chartered Accountants Chartered Accountants

FRN: 109816W FRN: 003289C

Place : Mumbai

Date : 29th July, 2011

(V. R. Shah ) (K. L. Vyas )

Proprietor Partner

M.No. 34994 M.No. 72043

53






54






55






56


Total (a)

Total (b)

Total (c) Total (d) Total (a+b+c+d) 57


58


59


SCHEDULES TO CONSOLIDATED BALANCE SHEET

SCHEDULE 4 : FIXED ASSESTS

PARTICULARS

GROSS BLOCK

DEPRECIATION

NET BLOCK

AS AT

ADDITIONS

SALES/

AS AT

AS AT

FOR THE

SALES/

AS AT

31/03/2010

TRANSFER

3 1 / 0 3 / 2 0

31/03/2010

YEAR

TRANSFER

3 1 / 0 3 / 2 0

31/03/2011

AS

31/03/2010

AS

LEASEHOLD LAND

15440862.70

74,224,038.50

- 89664901.20

- -

- -

89664901.20

15440862.70

AGRICULTURAL LAND

- 6943518.00

- 6943518.00

- -

- -

6943518.00

-

FA C T O R Y B U I L D I

159265685.52

1 7 , 4 1 6 , 9 11 .

- 176682597.45

51774207.97

10,850,699.58

- 62624907.55

114057689.90

107491477.55

P L A N T & M A C H I N E

2 111 7 6 5 0 1 .

7,982,546.09

- 219159047.20

128424715.79

13,264,792.53

- 141689508.32

77469538.88

82751785.32

LABORATORY EQUIPMENTS

1333402.96

51,800.00

- 1385202.96

532049.32

11 7 , 11 4 .

- 649163.47

736039.49

801353.64

OFFICE EQUIPMENTS

5080893.78

128,423.00

- 5209316.78

3789620.43

187,893.61

- 3977514.04

1231802.74

1291273.35

COMPUTERS

2278919.33

413329.00

- 2692248.33

1436016.81

386221.14

- 1822237.95

870010.38

842902.52

FURNITURE & FIXTURES

6545188.94

1,057,772.00

- 7602960.94

3083830.40

724,606.44

- 3808436.84

3794524.10

3461358.54

VEHICLES

17794334.59

1 7 7 1 ,3 11

396,101.00

19169544.59

8851706.82

2,608,963.01

332,088.87

111 2 8 5 8 0 .

8040963.63

8942627.77

418915788.93

109989649.52

396,101.00

528509337.45

197892147.54

28140290.46

332,088.87

225700349.13

302808988.32

221023641.39

PROGRESS

CAPITAL WORKS IN

16919059.64

81,586,470.45

24,250,766.52

74,254,763.57

- -

- -

74,254,763.57

16,919,059.64

PREVIOUS YEAR

TOTAL:

355087010.32

435834848.57

1 6 11 2 9 4 2 4 .

1 9 1 5 7 6 11 9 .

80381586.13

24646867.52

435834848.57

602764101.02

176341936.67

197892147.54

22769375.48

28140290.46

1,219,164.61

332,088.87

197892147.54

225700349.13

237942701.03

377063751.89

160876679.04

237942701.03

1. Lease hold Land and Building includes Rs.24922580.27 (Previous year Rs.24922580.27) pending registration with appropriate authority.

3. Some of the vehicles are in the name of directors/employees.

4. Capital Work in Progress includes Advance given for Purchase of Land amounting to Rs.Nil (Previous Year Rs. Rs. 7243557.50)

contained in Allotment Letter dated 25-03-2011 on construction of Fertiliser Manufacturing Facility within a stipulated period of 3 years.

5. Lease Hold Land includes Land at Plot No. D-2/CH/38, having Licence to enterupon cum right for grant of Lease for a period of 99 years by GIDC on the fulfillment of term

s & condition

6. Capital Work in Progress includes Pre Operative Expenses amounting to Rs.465486.00 (Previous Year Rs. Nil)


60


61


62


63


64


65


66


I. Statutory Auditors: 2.03 1.63 0.25 0.25

3.27 2.87

II. Cost Auditors:

a) Cost Audit Fees * 0.20 0.20

*(Including Service Tax & Out of Pocket Expenses)

67


68


(Including Arrears of Earlier Years)

69


Rate (%) 12.00 (Includes Interim Dividend of 6%)





70

LIBERTY PHOSPHATE LIMITED PROXY FORM

I/We, __________________________________ of ___________________ in the district of

_________________being a Member/Members of the above named Company, hereby appoint ________________________________of ____________ in the district of ________________ or failing him

____________________________________ of __________________ in the district of _______________

as my/our proxy to vote for me/us on my/our behalf at the TWENTY THIRD ANNUAL GENERAL MEETING of the company to be held on Wednesday, the 14th day of September, 2011 at 11.00 A.M. and at any adjournment thereof. Regd.Folio No.___________

Affix

Or Demat A/c No. Client ID No.____________

DP ID No._______________ Date : ____________

NOTES:

Signature Revenue Stamp

1. 2. 3.

The form should be signed across the stamp as per specimen signature registered with the

Company/Depository Participant. The Companies Act, 1956 lays down that the instrument appointing a proxy shall be deposited at the Registered Office of the Company not less than FORTY EIGHT HOURS before the time fixed for

holding the Meeting. A Proxy need not be a Member.

LIBERTY PHOSPHATE LIMITED Regd. office : 74/75, GIDC, Nandesari - 391340, District Vadodara

ATTENDENCE SLIP

PLEASE COMPLETE THE ATTENDENCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALL.

1. Name of the Attending Member (in Block Letters)

2. Members Folio No. _____________ Or Demat A/c No.,

Client ID No.__________________ DP ID No.___________ 3. Name of the Proxy (in Block Letters)

(To be filled in if the proxy attends instead of member)

No. of shares held : I hereby record my presence at 23rd Annual General Meeting at 74/75, GIDC, Nandesari - 391 340,

Distt.: Vadodara on Wednesday, the 14th day of September, 2011 at 11:00 A.M. Signature of the Shareholders/Proxy : ________________________ NOTES :

1. Shareholders/Proxy holders are requested to bring the attendance slip with them when they come to the meeting.

2. Shareholders/Proxies who come to attend the meeting are requested to bring their copies of Annual Report with them.

Book-Post

To

If undelivered please re

turn to

:

Liberty

Phosphate Ltd.

74-75, G

.I.D.C., N

andesari - 3

91 340

Distt. B

aroda, G

ujarat

Printed at : K

umawat Printers, 0294-2490268

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