Annual Report FY 2010-11 - Pipavav Shipyard

Pipavav Defence and Offshore
Engineering Company Limited
20. Deferred Tax Liability / (Asset)
As required by Accounting Standard 22 on “Accounting for Taxes on Income”, Deferred Tax is comprising of the following
items:
Particulars
Deferred Tax Liabilities
2010 – 2011
(Rs. in Lacs)
2009 – 2010
Related to Fixed Assets 8,237.56 4,075.48
Total
Deferred Tax Assets
8,237.56 4,075.48
Unabsorbed Depreciation 7,005.02 6,158.28
Disallowance under Income Tax 74.38 56.70
Total 7,079.40 6,214.98
Net Deferred Tax Liability / (Assets) 1,158.16 (2,139.50)
Deferred tax assets as at March 31, 2010 includes Deferred tax liability of Rs. 146.70 Lacs pertaining to E Complex Private
Limited, which was accounted for and Deferred tax assets of Rs. 2,286.20 Lacs pertaining to Pipavav Shipyard Limited
which in the absence of virtual certainty that sufficient future taxable income will be available against which deferred
tax assets can be realized , was not recognized in books of accounts in line with Accounting Standard- 22 dealing with
Accounting for Taxes on Income.
21. In respect of Offshore Vessels (OSVs), the Company has accounted for contract revenue and expenses based on the
proportion of completion of contracts as certified by technical experts. With an aim to allocate the profit on the said
contracts to whole of the contract during the year a provision of Rs. 8,372.32 Lacs (Previous Year Rs. 11,400.78 Lacs)
being the proportionate cost to be incurred has been made. The total provision on this account as on March 31, 2011 is
Rs. 8,372.32 Lacs (Previous Year Rs. 11,400.78 Lacs).
22. Presently the company is liable to pay Minimum Alternate Tax (MAT) under section 115JB of the Income Tax Act, 1961 (“the
Act”) and the amount paid as MAT is allowed to be carried forward for being set off against the future tax liabilities computed
in accordance with the provisions of the Act, other than section 115JB, in next ten years. Based on the future projection of
the performances the company will be liable to pay the Income Tax as per provisions, other than under section 115JB, of
the Act. Accordingly as advised in Guidance Note on “Accounting for credit available in respect of Minimum Alternate Tax
under the Income Tax Act, 1961” issued by The Institute of Chartered Accountants of India, Rs. 1,127.65 Lacs being the
excess of tax payable under section 115JB of the Act over tax payable as per the provisions other than section 115JB of
the Act has been considered as MAT credit entitlement and credited to Profit and Loss Account. The aggregate MAT credit
entitlement available to the company as on March 31, 2011 is Rs. 1,127.65 Lacs.
23. Disclosure pursuant to Accounting Standard – 7 (AS – 7 “Accounting for Construction Contracts”) as notified by Companies
Accounting Standards Rules, 2006:
Particulars 2010 – 2011
(Rs. in Lacs)
2009 – 2010
a. The contract revenue recognized in the year 39,172.66 44,529.58
b. The aggregate amount of cost incurred and recognized profits (less
recognized losses) upto the end of Financial Year for all contracts in
progress
77,082.62 50,037.08
c. Amount of advance received from the customers for contracts in progress 74,527.96 20,183.30
d. The retention amount due from customers for contracts in progress as at
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the end of Financial Year
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