The Scheme of amalgamation of the company with Reliance Industries Limited (RIL) has been approved by the shareholders and creditors of both the companies and submitted to the Hon'ble High Court of judicature at Mumbai and Gujarat for sanction u/s 391 and 394 of the Companies Act, 1956.
The Hon'ble High Court of Mumbai has sanctioned the scheme of amalgamation on 12th June, 2007. The sanction of Hon'ble High Court of Gujarat is pending. In terms of the scheme, the “appointed date” for amalgamation is 1st April 2006.
The exceptional and non-recurring items of Rs 470 crore relating to Voluntary Separation Scheme and Special Separation Scheme for the employees of Vadodara unit and provision for diminution in value of investments in Gujarat Chemicals Port Terminal Company Limited (GCPTCL) and Indian Vaccines Corporation Limited (IVCOL) charged to the Profit and Loss Account in the quarter and year ended 31st March 2007, has been prorated equally amongst the 4 quarters of 2006-07 with consequent adjustments to deferred tax. Accordingly the previous years' figures are restated to give effect to the above for comparative purposes.
The Company has continued to adjust the foreign currency exchange differences on amounts borrowed for acquisition of fixed assets, to the carrying cost of fixed assets in compliance with Schedule VI to the Companies Act, 1956 as per legal advice received, which is at variance to the treatment prescribed in Accounting Standard (AS11) on "Effects of Changes in Foreign Exchange Rates” notified in the Companies (Accounting Standards) Rules 2006 dated 7th December 2006. However there is no material impact on profit for the quarter.