2008 - 2009 - Tata Investment Corporation Limited

10
Seventy-second annual report 2008 - 2009
Tata Investment Corporation Limited
30th April, 2011. As a result of the two conversions, the paid-up capital of the Company would
increase from the present level of Rs.34.46 crores, in two tranches, fi rst to Rs.41.35 crores and then to
Rs.48.24 crores on 31st March, 2010.
Funds have been raised by the issue and allotment of the ZCCB to augment the long term resources
of the Company. In terms of the Letter of Offer, the Rights Issue proceeds of Rs.447.74 crores received
during the year have been utilised towards the objects of the Issue of Zero Coupon Convertible Bonds
(ZCCB) to make investments in a diversifi ed portfolio of quoted and unquoted securities including
equity shares/equity-linked securities, mutual funds, debentures/bonds, government securities,
preference shares, deposits in companies and includes issue related expenses.
8. UTILISATION OF THE SECURITIES PREMIUM ACCOUNT :
At the Extra-ordinary General Meeting held on 2nd December, 2008, the members had authorised the
Company to utilise a sum of Rs.35,00,00,000 (Rupees Thirty-fi ve crores only) presently standing to the
credit of the Securities Premium Account of the Company, by allocating such sum to be used against
provisions which may be required to be made for diminution in value of investments, as has been
done in the past. The utilisation of the Securities Premium Account in the above manner as permissible
under Section 78 of the Companies Act had to be implemented through a Capital Reduction Scheme
under Section 100 of the Companies Act. The Scheme has received the confi rmation of the Hon’ble
High Court of Judicature at Bombay vide its Order dated 30th January, 2009. In accordance with the
High Court Orders dated 27th September, 2002 and 30th January, 2009, and the Accounting Practice
adopted earlier, provision for dimunition in the value of investments amounting to Rs.21.86 crores has
been debited to the Securities Premium Account as on 31st March, 2009.
9. FIXED DEPOSITS :
Reserve Bank of India, on an application made by the Company, has, in May, 2008, changed the
classifi cation of the Company from a Non-Banking Financial (Deposit Accepting or Holding) Company
[Category A] to a Non Banking Financial (Non-Deposit Accepting or Holding) Company [Category B].
10. DIRECTORS’ RESPONSIBILITY STATEMENT :
Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors based on the representations
received from the Operating Management confi rm that, to the best of their knowledge –
(i) in the preparation of the annual accounts, the applicable accounting standards have been followed
and that there are no material departures;
(ii) they have, in the selection of the accounting policies consulted the statutory auditors and have
applied them consistently and made judgements 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 fi nancial
year and of the profi t & loss of the Company for the period;
(iii) they have taken proper and suffi cient care to the best of their knowledge and ability for the
maintenance of adequate accounting records in accordance with the provisions of the Act, for
safeguarding the assets of the Company and for preventing and detecting fraud and other
irregularities;
(iv) they have prepared the annual accounts on a going concern basis.
11. INTERNAL CONTROL SYSTEMS :
The Company has proper and adequate internal control systems commensurate with its size and
nature of operations to provide reasonable assurance that all assets are safeguarded, transactions are
authorised, recorded and reported properly and that all applicable statutes and corporate policies are
duly complied with.
The Company has appointed an independent fi rm of Chartered Accountants, as Internal Auditors, which
continuously reviews the adequacy and effi cacy of the internal controls. The Internal Auditors submit
an Internal Audit Report periodically which is placed before and reviewed by the Audit Committee.