The Case Study - Seylan Bank

204Seylan Bank PLC Annual Report 2009Notes to the Consolidated Financial Statements6. DC Colombo 07219/09/DMR. Case filed by the customer for collecting proceeds of a cheque crediting toa fictitious account. Answer 7th May 2010.7. DC Colombo DSP 212/2009 an enjoining order preventing the Bank from paying monies under the Letterof Credit issued by the Bank to Bank of China. Written submissions on 2nd March 2010 and noticereturnable on the 2nd defendant Veihai Joylong International.8. D C Bandarawela 1687/L to 1695/L (9 cases) occupants before the mortgage have filed actions againstthe Bank. Government intervened and acquired the property and we lodged the claim. Settlement date7th May 2010.9. DC Mt. Lavinia 500/4/P Bank has been added as 13th defendant and 10th defendant had mortgaged theproperty to the Bank. There is no claim against the Bank. Case to be called.10. DC Colombo 26321/M action claiming an ex-gratia payment. Trial fixed.11. CHC 638/09/MR (DC Colombo 6033/SPL) Bank has filed the case for an injunction, counter claim hasbeen made by the defendant.12. CHC 232/2002. This is instituted with regard to sale of shares of Blue Diamond Jewellery World Wide(BDJWL) held as security for the facility of Gold Lada. Action filed for damages claiming from Bank.Calling same. CHC 320/2002 (1) Case is fixed for hearing.13. CHC 243/2002 (1). This action is filed seeking a declaration from Courts that the Bank is not entitled tosell/alienate/transfer shares of the BDJWL company among other claims. Trial on 3rd May 2010.c. ii. Labour Tribunal Cases1. LT 1/377/97. Case filed by an employee. Settlement pending. To be called on 1st March 2010.2. Labour Department Inquiry No. IR/1055/2009 CA Writ 891/2009. Retired employees of Seylan Bank VsSeylan Bank. Labour Commissioner ordered to pay gratuity at the rate of one month salary for each yearof service for the employees who completed ten years service. Bank has filed a writ application in Courtof Appeal.Based on the available information and current status of the above cases, the Bank is not in a position toquantify the potential financial impact if any, as at the Balance Sheet date. Further, based on legal advice theBank does not expect the outcome of any action to have a material effect on the financial position of the Bank.39.d Tax Assessments Against Bank1. Assessment No. VATFS/BFSU/09/130 for VAT on Financial Services for 2007, amounts to Rs. 359,126,131/-.Bank made the appeal on 22nd December 2009, and Department of Inland Revenue acknowledged thesame on 15th January 2010.2. Income Tax for Y/A 2003/2004 amounting to Rs. 190,738,861/- determined by the Commissioner Generalof Inland Revenue, on assessment No. 8224200. Bank has made an appeal to the Board of Review andthe final hearing will be scheduled in April 2010.The Bank is in the view that the above assessments would not have any material impact on theFinancial Statements.