MINISTRY OF FINANCE AND COMPANY AFFAIRS

(Department of Company Affairs)

NOTIFICATION

New Delhi, the 8th October, 2002

G.S.R 685 (E).—in exercise of the powers conferred by sub-section (1) of section 642,

read with clause (d) of sub-section (1) of section 209 of the Companies Act, 1956 (1 of

1956), the Central Government hereby makes the following rules, namely:-

1. Short title and commencement- (1) These rules may be called the Cost

Accounting Records (Plantation Products) Rules, 2002.

(2) They shall come into force on the date of their publication in the Official

Gazette.

2. Application - These rules shall apply to every company engaged in production,

processing or manufacture of product(s) as specified in the Appendix to these

rules:

Provided that these rules shall not apply to a company, -

(a) the aggregate value of machinery and plant installed wherein, as on the

last date of the preceding financial year, does not exceed limit as specified

for a small scale industrial undertaking under the provisions of Industries

(Development and Regulation) Act, 1951 (65 of 1951); and

(b) the aggregate value of the turnover made by the company from sale or

supply of all its products during the preceding financial year does not exceed

ten crores of rupees.

3. Maintenance of records: -

(1) Every company to which these rules apply shall, in respect of each of its

financial year commehcing on or after the commencement of these rules, keep

proper books of account relating to utilisation of materials, labour and other items

of cost in so far as they are applicable to any of the products referred to in the

Appendix.

The books of account, so maintained, shall contain, inter-alia, the

3138 GI/2002—4

THE GAZETTE OF INDIA: EXTRAORDINARY

IPARTII—SEC, 3(1)1

particulars specified in Schedule annexed to these rules and Proformae A, B C, D,

E and F mentioned in the said Schedule:

Provided that if the said company is manufacturing any other product(s) or is

engaged in other activities in addition to product(s) referred to in the Appendix, the

particulars relating to utilisation of materials, labour and other items of cost in so far

as they are applicable to such other products or activities shall not be included in

the cost of the product(s) referred to in the Appendix.

(2) The books of account referred to in sub-rule (1) shall be kept on a regular basis

in such a manner as to make it possible to calculate the cost of production and cost

of sales of product(s) under reference for every financial year from the particulars

entered therein and every such books of account and the proformae specified in

the said Schedule, shall be completed not later than ninety days from the close of

the financial year of the company to which it relates.

(3)

The statistical and other records shall be maintained in accordance with the

provisions of the Schedule to these rules in such a manner as to enable the

company to exercise, as far as possible, control over the various operations and

costs with a view to achieve optimum economies in cost. These records shall also

provide the necessary data required by the Cost Auditor to suitably report on all the

points referred to in the Cost Audit (Report) Rules, 2001 as amended from time to

time.

(4) It shall be the duty of every person, referred to in sub-section (6) and (7) of

section 209 of the Companies Act, 1956 (1 of 1956), to take all reasonable steps to

secure compliance by the company with the provisions of sub-rules (1), (2) and (3)

of this rule in the same manner as he is liable to maintain accounts required under

sub-section (1) of section 209 of the said Act.

4. Penalty - If a company contravenes the provisions of rule 3, the company and

every officer thereof who is in default, including the persons referred to in sub-rule

(4) of rule 3 shall, be punishable as provided under sub-section (2) of section 642

read with sub-sections (5) and (7) of section 209 of Companies Act, 1956 (1 of

1956).

Appendix

(see rule 2)

List of plantation products for which the rules shall apply.

1. Tea and tea products

2. Coffee and coffee products

3 Other commercial plantation products including seeds thereof.

SCHEDULE

[see rule 3]

1. MATERIALS

(1) The proper records shall be maintained showing separately all receipts, issues

and balances both in quantities and values of each item of input materials

required for production, processing or manufacturing of products referred to in

Rule 2. These records shall contain such details so as to enable the company to

determine the quantity and cost of receipt (including all direct charges up to

Estate/works in respect of materials) issues and balances in quantity as well as

value of each item of all such materials used in raising of nursery, clones,

plantlets, shade management, cultivation of new sections, re-plantation of the

sections, regular maintenance of existing plantation sections and processing of

products produced. The basis on which said quantities and costs of issue and

consumption have been calculated shall be indicated in the cost records and

followed consistently, In the case of imported materials proper records shall be

maintained showing FOB value, overseas freight, insurance, customs duty and

inland freight charges etc. If both indigenous and imported materials are

consumed, the records showing details of percentage mix of the same have to be

maintained for each item. In the case of imported materials, proper records shall

be maintained showing license-wise allowed quantities, actual quantities

imported, actual quantities consumed, quantities in stock and quantities yet to be

imported out of total licensed quantities. Proper records shalf j?iso be maintained

showing the quantity and cost of any material recovered from waste and re-used

for producing, processing or manufacture of product(s) referred under rule 2.

(2) The proper record shall be maintained to show the receipts, issues both in

quantity and cost of each item of consumable stores, tools, spares etc. The cost

of consumption of consumable stores, small tools and spares etc. shall be

charged to relevant cost center or department on the basis of actual issues. In

case of consumables stores and tools the value of which are not significant, the

company may, if so desires, maintain such records for the main group of such

items.

(3) The proper records shall be maintained showing the quantity and value of

wastage, spoilage, rejections and losses of materials, process materials,

consumable stores whether in transit, storage, or at any other stage. The method

followed for adjusting the above losses as well as income derived from the

disposal of rejected and waste materials including spoilage, if any, shall be

indicated in the cost records.

(4) The proper records shall also be maintained to indicate the value of materials

and components which have not moved for more than twelve months.

(5)

If any of the materials purchased such as green leaves is processed in

house or by an outside party, proper records shall be maintained for the quantity

purchased and processed in house, quantity sent for p,.. messing outside, quantity

THE GAZETTE OF INDIA: EXTRAORDINARY

[PARTII—SEC.3(I)]

received after processing, by products received, if any, and the cost involved in

processing.

(6) Where any credit under Central Value Added Tax (CENVAT) under the Central

Excise Act, 1944 (1 of 1944) or any other benefits of the nature of CENVAT

Credit are received or receivable on any item of material and/or consumable

stores or spares, the cost of such material and/or consumable stores or spares

should be shown after adjusting such credit or benefits.

2. SALARIES AND WAGES:

(1)

The proper records shall be maintained to show the attendance and earnings of

all employees of the cost centres or estate and the work on which they are

employed. The records shall also indicate the following separately for each cost

centre or estate:

(a) piece rate wages (wherever applicable);

(b) incentive wages, either individually or collectively as production bonus

or under any other scheme based on output;

(d) earnings of casual or contractual labour;

(e) bonus or gratuity, statutory as well as other;

(f)

contribution to superannuation scheme; and

(g) any other earning of the nature specified in (a) to (f) above.

(2)

The records shall be maintained in such a manner as to enable the company to

furnish necessary particulars under this head in Proformae A, B, C, D, E and F of

Schedule annexed to these rules. The records may be maintained to book these

expenses section-wise under nursery, shade management, immature plantation,

and replantation, regular.up keep and maintenance of existing plantation and

processing or manufacturing of products. Where the employees work in such a

manner that it is not possible to identify them with any specific cost centre or

product, the labour charges shall be apportioned to the cost centres or products

on equitable and reasonable basis and applied consistently.

(3)

The idle labour cost shall be separately recorded under classified headings

indicating the reasons therefore. The method of accounting followed for

accounting of idle time payments in determining the cost of the product shall be

disclosed in the cost records.

(4)

Any wages and salaries allocable to capital works, such as, additions to plant

and machinery, buildings or other fixed assets shall be accounted for under the

relevant capital heads. Similarly, payments in the nature of deferred revenue

expenditure shall be separately recorded under separate classified headings

indicating the reasons therefore. The method followed for accounting of such

payments in determining the cost of the product shall be on equitable and

reasonable basis and applied consistently. The said method shall be disclosed in

the cost records also.

(5) The cost of termination benefits payable to employees shall be separately recorded

under separate heads. The method followed for such cost in determining the cost

of products referred to in the Appendix shall be on equitable and reasonable

basis, applied consistently and disclosed separately. Subject to the accounting

standard or guidelines issued by the Institute of Chartered Accountants of India in

this regard, only the termination benefits say in respect of voluntary retirement

scheme, which are payable in addition to the normal retirement benefits and are

likely to provide benefits in terms of savings in cost in future shall be treated as

deferred revenue expenditure over a period not exceeding five years. These

costs shall not form part of salaries and wages and shall be shown separately.

Such costs shall be excluded from valuation of inventories since these do not

result in putting the inventories to their present location and condition.

3. SERVICE DEPARTMENT EXPENSES:

The detailed records shall be maintained to indicate expenses incurred in respect

of major service department or cost centre. These expenses shall be apportioned

to other services production and processing departments on equitable and

reasonable basis and applied consistently. Where these services are utilised for

other products or activities of the company also, the basis of apportionment of

such expenses to the products referred to in the Appendix and to other products

or activities shall be on equitable and reasonable basis and applied consistently.

4. UTILITIES:

(1) Water - The proper records showing the quantity and cost of water consumed, if

any for the production, process, manufacture of product under reference shall

be maintained. The cost of water shall be apportioned to the different cost

centers or departments concerned on equitable and reasonable basis and

applied consistently.

(2) Steam - Where steam is raised by the company, proper records showing the

quantity and cost of steam raised and consumed for the production, processing

or manufacturing of the pfoduct(s) referred to in the Appendix shall be

maintained. The cost of steam consumed by various units of the company shall

be apportioned on equitable and reasonable basis and applied consistently.

Where steam is raised and supplied by any other unit of the company to the

referred product, the cost of steam so supplied shall be charged to the referred

product on equitable and reasonable basis and applied consistently.

(3) Power - Where power is purchased, proper records shall be maintained for the

units and cost of power consumed for the product(s) under reference in different

cost centers or departments. Where the company itself generates power,

adequate records showing all elements of cost shall be maintained to show the

cost of power generated and consumed for the product(s) under reference in

different cost centers or departments.

THE GAZETTE OF INDIA: EXTRAORDINARY

|PARI II—SHC. 3(i)]

(4) Other Utilities - The proper records showing the quantity and cost shall be

maintained in respect any other utilities purchased or produced by the company

for the production, processing or manufacturing of product(s) under reference, the

cost of these utilities shall be apportioned to the product(s) on equitable and

reasonable basis and applied consistently. The cost statements of each utility

shall be maintained in proforma 'A'.

5. REPAIRS AND MAINTENANCE

(1) The proper records showing the expenditure incurred on repairs and maintenance

of roads and fencing, drip irrigation systems, buildings and equipment etc in the

various sections of estates or cost centers etc shall be maintained. The records

shall also indicate the basis of charging such repairs and maintenance expenses

to different cost centres or departments.

(2) The records should indicate the amount and also the proportion of closing

inventory of stores and spare parts representing items, which have not moved for

over twenty-four months.

(3) The expenditure on major repair work from which benefit is likely to accrue for

more than one financial year shall be allocated over the period expected to

benefit on equitable and reasonable basis and applied consistently. Such costs

shall be shown separately and the method of accounting along with the basis of

allocation of such costs shall also be clearly indicated in cost records.

6. DEVELOPMENT COST OF LANDS, NEW PLANTATION OR RE-PLANTATION:

(1) The proper record shall also be maintained for new plantation/re-plantation

development. These records shall indicate expenses on manuring, sapling, and

plantation, pesticides, weedicides, infilling. These records shall be maintained

section wise and year wise.

(2) The expenses incurred on development of land, and new plantation/re-plantation

shall be capitalised or charged off in accordance with the accounting

standard/guidelines issued by the Institute of Chartered Accountants of India or

other generally accepted accounting principles followed in respective plantation

industries.

(3) In case new plantation or re-plantation yields some crops during its period of

immaturity, credit for sale of such crop shall be given to the development costs.

The subsidy received from Government or Commodity Board each year till the

new planted or replanted section matures shall be credited to the development

cost of new plantation or re-plantation subject to accounting standard or

guidelines issued by the Institute of Chartered Accountants of India. The net

capitalised cost shall be amortised over its useful life beginning for the year in

which the plantation/re-plantation be comes mature and gives regular yield of

crop. In case leasehold land is developed and the lease period is shorter than the

life of plantation, then the net capitalised cost of plantation should be amortised

over the remaining lease period.

7. FIXED ASSETS AND DEPRECIATION:

(1) The proper and adequate records shall be maintained for assets used for each of

the products under reference in respect of which depreciation has to be provided

for. These records shall inter-alia, indicate the cost of acquisition of each item of

asset including installation charges, capitalised cost of plantation or replantation,

date of acquisition/ plantation and rate of depreciation. The adequate records

shall be maintained to enable the company to identify the capital employed, net

fixed assets and working capital separately for the product(s) under reference and

other activities or product(s). Fresh investment on fixed assets that have not

contributed to the product(s) referred to in the Appendix shall be indicated in the

cost record.

(2) The basis on which depreciation is calculated and allocated or apportioned to

various cost centres or departments and absorbed on such products shall be

clearly indicated in the cost records. If depreciation charged or chargeable to the

cost centres or departments is in excess or lower than the depreciation calculated

by applying the rates of depreciation prescribed under the provisions of section 205

of the Companies Act, 1956, such amount of excess or lower depreciation shall be

indicated clearly in the cost records. The cost records shall also show the effect of

such excess or lower depreciation, as the case may be, on the per unit cost of

activity. The cumulative depreciation charged in the cost records, against any

individual item of asset shall not, however, exceed the original cost of the

respective asset.

8. OTHER OVERHEADS:

(1) The proper records shall be maintained for the product(s) under reference

showing the various items of expenses comprising the other overheads. These

expenses shall be analysed, classified and grouped according to functions,

namely, up keep and maintenance of plantation, manufacturing, administration

and sales etc.

(2) Where the company is manufacturing product(s) other than the product(s) under

reference, the records shall clearly indicate the basis followed for apportionment

of the common overheads including head office expenses of the company to such

product(s) and to other product(s) or activities including capital works. Where

certain expenses forming part of overheads can be identified with a particular

activity or a product, such expenses shall be first segregated and charged to the

relevant activity or product and thereafter the residual expenses under the above

categories of overheads shall be apportioned on equitable and reasonable basis

and applied consistently. The overheads chargeable to capital works shall be

indicated separately in the cost records. The basis of apportionment or absorption

of overheads to the cost centres and the products shall be indicated in the cost

records.

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART D—SEC. 3(i)]

9. ROYALTY OR TECHNICAL KNOW-HOW FEE OR LEASING CHARGES:

(1) The adequate records shall be maintained showing royalty and/or technical know-

how fee including other recurring or non-recurring payments of similar nature if

any, made for the product(s) under reference to collaborators or technology

suppliers in terms of agreements entered into with them. Such records shall be

kept separately in respect of each such collaborator or supplier. The basis of

charging such amount, including lump sum payment and its treatment shall be

indicated in the cost records.

(2) In the case of leasing arrangements, proper record shall be maintained showing

details of terms and conditions, leasing charges paid or payable as well as

received or receivable.

(3) If a lease land is developed and the lease period is shorter than the life of

plantation, the period of lease and conditions for future renewals of lease shall be

indicated in the record.

10. RESEARCH AND DEVELOPMENT EXPENSES

(1) The proper records showing the details of expenses, if any, incurred by the

company on the research and development work related product(s) under

reference shall be maintained. Proper records for the contribution to any outside

Research and Development organisation to avail of the benefits of research in the

augmentation of productivity, quality or value of product should be maintained.

(2) The method of charging these expenses to the cost of product(s) under reference

and all other products or activities shall be indicated in the cost records. Where

the utility of such research and development work extends over more than one

financial year, such expenses shall be treated as deferred revenue expenses and

charged to the cost of product(s) under reference and all other products or

activities if any, on equitable and reasonable basis and applied consistently. The

detailed criteria on which it has been decided to extend the utility period of these

expenses to more than one financial year shall be disclosed in the cost records.

The following criteria, which are only indicative and not exhaustive, may be

adopted in such cases:

(1) the output or process is clearly defined and the costs attributable to the

output or process can be separately identified;

(2) the technical feasibility of the output or process has been demonstrated;

(3) the management of the enterprise has indicated its intention to produce

and market or use the output or process;

(4) there is a reasonable indication that current and future research and

development costs to be incurred on the project together with expected

production, administrative and selling costs are likely to be more than

covered by related future revenues or benefits; and

(5) adequate resources exist or are reasonably expected to be available to

complete the project and market the output or process

(3) The expenses incurred by the Research and Development Department for

providing technical know-how to outsiders shall be recorded separately and

excluded from the cost of product(s) under reference. The amount recovered for

providing technical know-how to outsiders shall also be indicated separately and

excluded from the income arising from the sale of product(s) under reference.

11. EXPENSES OR INCENTIVES ON EXPORTS:

The proper records showing the expenses incurred on the export sales, if any, of

the product(s) under reference shall be separately maintained so that the cost of

export sales can be determined correctly.

Separate cost statement shall be

prepared for product(s) exported giving details of export expenses incurred and

incentive earned. In case, duty free imports of input materials are made, the cost

statements should reflect this fact.

12. TASTING/TESTING (Quality Control)

(1)

Proper records shall be maintained showing date wise tasting or testing results

i.e. quality index of different samples against different grades of product

manufactured.

(2)

Detailed records of expenses incurred on expenses on tasting or testing for the

whole year shall also be kept so as to assess the over all achievement in terms of

quality of product manufactured in the garden.

13. PACKAGING AND PACKING

(1) Proper records shall be maintained showing the quantity and cost of various

packaging materials and other expenses incurred for packaging the product(s)

under reference.

(2) Detailed records of expenses incurred on expenses on export packaging and

packing if any, shall also be kept separately and exhibited in the relevant cost

statement for exports.

14. INTERESTS AND BORROWING COST:

The proper records shall be maintained for money borrowed separately for each

project and/or working capital and interest charges thereon. The amount of interest

shall be allocated or apportioned to the product(s) under reference and other

products or activities on equitable and reasonable basis and applied consistently.

The basis of further charging of the share of the interest to the various types of such

products shall also be equitable and reasonable and applied consistently. The basis

of such allocation or apportionment shall be spelt out clearly in the cost records and

statements. Net borrowing cost incurred on borrowed money or outlays for projects

under execution, shall be capitalised for the period up to the date of commencement

<of commercial activities.

3138 GI/2002—5

' THE GAZETTE OF INDIA EXTRAORDINARY

[PART II—SEC.3(J)]

15. WORK IN PROGRESS AND FINISHED STOCK:

The method followed for determining the cost of work in progress and finished stock

of the outputs shall be indicated in the cost records so as to reveal the cost element

that have been taken Into account in such computation. The appropriate share of

conversion cost up to the stage of completion shall be taken into account while

computing the cost of work in progress. The method adopted for determining the cost

of work in progress and finished goods shall be followed consistently.

16. COST STATEMENTS

(1)

The cost statements showing details of total land, cultivated land, production,

wastage and sales and all elements of cost of the current financial year and

previous year shall be prepared for each product under reference in Proformae A,

B, C, D, E and F.The product emerging from a process which forms raw material

for a subsequent process, shall be valued at the cost of production upto the

previous stage.

(2) If the company is operating in more than one garden/manufacturing unit, separate

cost statements as specified above shall be maintained in respect of each such

garden or manufacturing unit.

17. PRODUCTION RECORDS:

(1)

The detailed records of crop produce from different gardens or estate and

purchased from other source, if any, shall be maintained to keep account of

produce processed and the conversion factor i.e. ratio of crop produce and

finished product(s) manufactured or produced. The records of production shall be

in such details that the company is in a position to fill in the relevant proforma or

any other proforma thereto applicable.

Separate records shall also be

maintained for the products sent to outside agencies for curing or processing and

charges paid thereof. In case product is graded according to quality or size,

complete details shall be maintained for graded products.

(2)

Quantitative records of all finished goods, whether packed or unpacked, showing

production, issues for sales and balances of different types of the product(s)

under reference shall be maintained.

18. RECONCILIATION OF COST AND FINANCIAL ACCOUNTS

(1) The cost statements shall be reconciled with the financial statements for the

financial year specifically indicating the expenses or incomes not considered in the

cost records or statements so as to ensure accuracy and to adjudge the profit of

the product under reference with the overall profit of the company. The variations, if

any, shall be clearly indicated and explained.

,(2) A statement showing the total expenses incurred and income received by the

company under different heads of accounts and the share applicable to other

activities or services shall be prepared in Proforma F and reconciled with the

financial statement.

19. ADJUSTMENT OF COST VARIANCES:

Where the company maintains cost records on any basis other than actual such as

standard costing, the records shall indicate the procedure followed by the company

in working out the cost of the products and services under such system. The cost

variances shall be shown against the separate heads and analysed into material,

labour, and overheads and further segregated into quantity, price and efficiency

variances. The method followed for adjusting the cost variances in determining the

actual cost of the product(s) shall be indicated clearly in the cost records. The

reasons for the variances shall be duly explained in the cost records and

statements,

20. STATISTICAL RECORDS:

1. Data regarding productivity and area under different sections namely nursery, re-

plantation etc. shall be maintained. Details regarding section wise pruning shall

also be maintained.

2. In the case of new projects for product under reference, proper records shall be

maintained indicating the funds raised from different sources, their utilisation,

stage-wise cost incurred and progress of the project as per the project report. Cost

and time over run shall also be analysed with reference to the cost of services/

activity and profitability of the company

3. Whenever World Trade Organisation provisions are attracted, proper records shall

be maintained to

identify the competitiveness of the product in the domestic as

well as global market and the expenses, if any, incurred to combat the competition

arising out of World Trade Organisation provisions. Adequate statistical records

shall also be maintained to identify the market share of the product manufactured

and the likely impact thereon on account of competitive goods imported in to the

country. Proper records shall also be maintained, containing such details as may

be necessary to show that the export price of the product is not such as to be

construed as dumping in the importing country, by applying the provisions of World

Trade Organisation regarding anti dumping measures under Article VI of General

Agreement on Trade and Tariff 94.

21. CAPTIVE CONSUMPTION:

If product(s) under reference are used for captive consumption, proper records

shall be maintained showing the quantity and cost of each item of output

transferred to other department or units of the company for self-consumption and

sold to outside parties separately.

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART II—SEC. KDI

22. POLLUTION CONTROL:

The Expenditure incurred by the company on various measures to protect the

environment like effluent treatment, control of pollution of air, water, etc., should be

properly recorded.

23. HUMAN RESOURCES DEVELOPMENT:

Expenditure incurred by the company on the human resources development activity

shall be recorded separately.

24.

INTER COMPANY TRANSACTIONS:

(1) In respect of related party transactions or supplies made or services rendered

by a company to its holding company or subsidiary or a company termed "related

party relationship" as defined below and vice-a-versa, records shall be maintained

showing contracts entered into, agreements or understanding reached in respect

of:

(a) purchase and sale of raw materials, finished products, process

materials, chemicals and rejected goods including scraps, etc;

(b) utilisation of plant facilities and technical know-how;

(d) administrative, technical, managerial and/or any other consultancy

services;

(e) purchase and sale of capital goods including plant and machinery;

(f) any other payment related to production, processing or manufacturing

of product under reference.

These records shall also indicate the basis followed for arriving at the rates

charged or paid for such products or services so as to enable determination of the

reasonableness of such rates in so far as they are in any way related to product

under reference.

(2) The transactions by the following "related party relationships" shall be covered

under sub rule (1): -

(a) enterprises that directly, or indirectly through one or more intermediaries,

control, or are controlled by, or are under common control with, the reporting

enterprise (this includes holding companies, subsidiaries and fellow

subsidiaries);

(b)

associates and joint ventures of the reporting enterprise and the investing

party or venturer in respect of which the reporting enterprise is an associate or

a joint venture;

reporting enterprise that gives them control or significant influence over the

enterprise, and relatives of any such individual;

key management personnel and relatives of such personnel; and

(e) enterprises over which any person described in (c) or (d) is able to exercise

significant influence. This includes enterprises owned by directors or major

shareholders of the reporting enterprise and enterprises that have a member

of key management in common with the reporting enterprise.

However, the following shall not be deemed as "related party relationships": -

(a) Two companies simply because they have a Director in common,

notwithstanding paragraph (d) or (e) above (unless the Director is able

to affect the policies of both companies in their mutual dealings);

(b) a single customer, supplier, franchiser, distributor, or general agent

with whom an enterprise transacts a significant volume of business

merely by virtue of the resulting economic dependence; and

enterprise by virtue only of those dealings (although they may

circumscribe the freedom of action of the enterprise or participate in its

decision-making process);

(i)

providers of finance;

(ii) trade unions;

(iii) public utilities;

(iv) government departments and government agencies including

government sponsored bodies.

Explanations: - for the purpose of these Rules,-

(a) "related party relationships" means parties who are considered to be related

if at any time during the reporting period one party has the ability to control the

other party or exercise significant influence over the other party in making financial

and/or operating decisions;

(b) "related party transaction" means a transfer of resources or obligations

between related parties, regardless of whether or not a price is charged;

the voting power of an enterprise; or

(ii) control of the composition of the Board of Directors in the case of a company or

of the composition of the corresponding governing body in case of any other

enterprise; or

(iii) a substantial interest in voting power and the power to direct, by statute or

agreement, the financial and/or operating policies of the enterprise;

(d) "significant Influence" means participation in the financial and/or operating

policy decisions of an enterprise, but not control of those policies;

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART II—Sue 3^1

(e) "an Associate" means an enterprise in which an investing reporting party has

significant influence and which is neither a subsidiary nor a joint venture of that

party;

(f) "a Joint venture" means a contractual arrangement whereby two or more

parties undertake an economic activity, which is subject to joint control;

(0) "joint control" means the contractually agreed sharing of power to govern the

financial and operating policies of an economic activity so as to obtain benefits

from it;

(h) "key management personnel" means those persons who have the authority

and responsibility for planning, directing and controlling the activities of the

reporting enterprise;

(1) "relative" means in relation to an individual, means the spouse, son, daughter,

brother, sister, father and mother who may be connected by blood relationships;

(j) "holding company" means a company having one or more subsidiaries;

(k) "subsidiary" means a subsidiary within the meaning of Section 4 of the

companies Act, 1966(1 of 1956);

(I) "fellow subsidiary" means a company is said to be a fellow subsidiary of

another company if both are subsidiaries of the same holding company;

(j) "state-controlled enterprise" means an enterprise, which is under the control

of the Central Government or State Government.

PROFORMAA

Name of the Company:

Name and address of Estate or Works:

Statement showing the cost of Utilities likes (1) Water, (2) Power, (3) Steam

generation, (4) Effluent treatment etc. produced or consumed during the year or

period.

Quantitative Information:

Serial

Number

Particulars

Installed capacity

Quantity produced

Capacity utilisation

Quantity re-circulated

Quantity purchased, if any

Self consumption including

other losses (to be specified)

Net units consumed

Unit

Current year

Previous year

Cost Information:

Serial

Number

A1.

10-

10.

11.

Particulars

Materials(specify)

(a)

(b)

(c)

Utilities(specify)

(a)

(b)

(c)

Wages and

Salaries

Consumable Stores

and spares

Repairs and

Maintenance

Depreciation

Other Direct

Expenses, if any

Other overheads

TOTAL

Less: Credit, if any

Net Total

Apportioned to cost

centre or activity

4etc.

Quan-

tity

Rate per

unit(Rs.)

Amount

(Rupees)

Cost per Unit

Current

Year

(Rupees)

Year

(Rupees)

Notes: -

Separate cost sheet is to be prepared for each utility.

If any of the utilities, which are manufactured by the company, is sold to

outside parties, proper credit should be given in the cost of production of the

respective utility.

The proforma may be modified suitably to incorporate unit specific special

features, if any, indicating reasons thereof.

Delete items not applicable.

4 0

THE GAZETTE OF INDIA: EXTRAORDINARY

TPARTII^SEC. 3(i)l

PROFORMA B

Name of the company:

Name and address of Estate :

Name of the Product:

Statement showing the cost of Nursery raised during year or period :

A Quantitative Information

Serial

No.

Particulars

Area Under Nursery - Clones :

Area under Nursery - Seeds :

Total Area under Nursery :

Number of plantlets

(a) From clones

Balance brought forward:

Used for plantation:

Spoilage or death:

Balance carried forward:

(b) From seeds

Balance brought forward:

Used for plantation:

Spoilage or death:

Balance carried forward:

Unit

Current

year

B. Cost Information

Host Par 100 Plants

Serial

Number

10.

Particulars

MateriaIs( Please specify

major Items)

Utilities (specify)

Wages & Salaries

Other Direct Expenses,

if any (specify)

Consumable Stores

Repairs

and

Maintenance

Depreciation

Other overheads

Total Cost of Nursery

Less: Credits, if any

Net Total (9-10)

Quantity

(Unit)

Kate

(Rs)

Amount

(Rs)

Current

year

(Rs)

year

(Rs)

C. Nursery Plants used in

Plantation 1 (to be specified)

Plantation 2

Plantation 3

Total

No. of Plants

Amount

Note:

Separate statement shall be prepared in respect of each type of plantation.

Delete items not applicable.

The proforma may be modified suitably to incorporate unit specific special

features, if any, indicating reasons thereof.

Proforma 'C

Name of the company :

Name and address of Estate :

Name of the Product:

Statement showing the Cost of Development - New plantation, replantation or

rejuvenation

Name of Estate or Garden

Quantitative Information

Serial

No.

Particulars

Area of land

Year of plantation

No. of plants

Density of plants per hectare

Plants ratio(Clone:Seed)

Period of ammortisation

Unit

Current

year

Prevraus

year

3138 GI/2002—6

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART II—SEC, 3(1)1

Cost Information

SL.

No.

Particulars

Material:

(a)

Cost

nursery

plants(Proforma B)

(b) Fertilizer

(2)(to be specified)

Salaries & Wages:

Consumable stores

Repairs and Maintenance

Other

direct

expenses

(specify)

Depreciation

Other overheads

Total Cost (1 to 7)

Less credit:

(a)subsidy

grant

from

Government/Board

(b)Others(to

specified)

Net Development Cost

Cumula

tive

balance

till date

Amount

spent

during

the year

Total

Amount

c/f

Amount spent

during

previous year

Notes:

(1) Separate statement shall be prepared for different development work in

respect of each garden/estate.

(2) Development expenditure incurred for new plantation or re-plantation shall

be amortised Or capitalised or charged off in accordance with the generally

accepted accounting principles followed in respective plantation industries.

(3) Columns for recording y©af wise expenditure are illustrative only.

(4) In case of any other development programme for the estate, which needs

capital expenditure, detailed records in suitable proforma may be

maintained for compilation of the same to be included in the cost records.

(5) The proforma may be modified suitably to incorporate unit specific special

features, if any, indicating reasons thereof.

Proforma 'D'

Name of the company ;

Name and address of Estate

Name of the product:

Statement showing the cost for production of

(crop) produced during

year or period:

A. Quantitative Information

10.

11.

12.

Particulars

Area

Year of Plantation

Density of plants per Hectare

Plantating material used

Pruning type

Total quantity produced

Quantity sold to other units

Quantity of wastage

Net

Quantity

transferred

factory/works

(6-7-8)

No of plucking or tapping days

No of man days for plucking or

tapping

Plucking average

Unit

current

Year

B. Cost Information

Particulars

Materials (Major items to be

specified)

Wages and Salaries

Consumables and Spares

Other direct expenses(please

specify)

Repair and Maintenance

Amortisation

cost

development program

Depreciation

Quality Control

Quantity

(Unit)

Rate/

Amount

(Rs)

Cost

Current

Amount

(Rs)

Per Unit

Amount

(Rs)

THE GAZETTE OF INDIA: EXTRAORDINARY

(PART II—SEC. 3(i)l

10.

11.

12.

13.

14.

Research and Development

Other Overheads

Statutory Cess or Levy, if any

Total Cost

Less Credit for by-product

Net Cost of production

C. Production used in

1. Other departments for further processing

2. Sales to related parties

3. Other Sales

Total

Quantity

Rate

Amount

Notes:-

1. This proforma shall be separately filled in respect of all major type of

products produced or processed in the garden/estate.

2. If the production is sold without further processing, separate proforma E

shall be prepared to compute the Cost of Production or Sales and Margin on

such sales.

3. The proforma may be modified suitably to incorporate unit specific special

features, if any, indicating reasons thereof.

Proforma E

Name of the company :

Name and address of Estate :

Name of the Product:

Statement of Cost of product manufactured or sold during the year ending

A. Quantitative Information

10.

Particulars

Crop produced (as per proforma

Crop purchased or received from

other units

Total crop (1+2)

Less wastage/driage, if any

Net Crop ( 3^1)

Finished product produced

Less

wastage

for

finished

products

Net finished product (6-7)

Ratio of 5:8

Installed

capacity

finished

goods

Unit

Current

Year

11.

12.

13.

14.

Quantity

used

for

captive

consumption

Quantity sold

(a) Domestic

(b) Export

Closing stock

Opening stock

B Cost Information

No.

5..

10.

11.

12.

13.

14.

15.

16.

17.

18.

1S.

20.

21.

22.

23.

Particulars

Crop

produced

per

proforma D

Crop Purchased

Other materials, (specify)

Total Material Cost(1 to 3)

Utilities (specify)

Wages and Salaries

Processing charges paid

Other direct expenses, if

any

Consumable stores

Repair and maintenance

Depreciation

Lease rent, if any

Royalty or technical know-

how fee, if any

Research and Development

expenses

Tasting or Testing expenses

(quality control)

Other

Production

Overheads

Cess, if any (specify)

Administration Overhead

(a)Salaries and Wages

(b) Labour welfare cost

Sub Total

Total Cost

•

—i,, .simoni (work in

progress)

Less credit for by-product or

wastage

Net cost of production

Stock Adjustment (Finished

product)

Quantity

(Unit)

Rate

(Rs)

Amount

(Rs)

Cost

Current

year

(Rs)

Per Unit

year

(Rs)

THE GAZETTE OF INDIA: EXTRAORDINARY

[PART II—SEC. 3(1)]

24.

25.

26.

27.

28.

29.

31.

32.

Packing or Packaging Cost

Selling

and

Distribution

Overhead

(a)Salary and Wages

(b)freight and transport

(c)Warehousing

(d) Commission to agent

(e)Advertisement exp

Others, specify

Cost of sales

Interest

and

finance

charges:

(h) for manufacturing

activity

(i) Others(specify)

(j) Subtotal

Total Cost

Sales Realisation

Marain(29-28)

Add: (1) Subsidy or grant

from Govt, or Board.

(2)Export

Benefits

and incentives, if any

Total Margin(30+31)

Notes:

1. Separate cost sheet shall be maintained in respect of each main/major type

and grade of product, as far as practicable.

2. Input/output ratio for different products shall be indicated separately in the

cost sheet.

3. The basis on which cost is apportioned to different grades of product along

with their sales realisation shall be indicated in this proforma, as far as

practicable.

4. Separate proforma shall be prepared for the quantity sold within the country

and quantity exported. Expenses incurred on export and incentive earned

thereon shall be indicated in the proforma for quantity produced and exported.

5. The proforma may be modified suitably to incorporate unit specific special

features, if any, indicating reasons thereof.

6. Separate proformae shall be prepared in respect of related party trans-⁴

defined under the rules.

PROFORMA 'F'

Name of the company:

Statement showing the allocation or apportionment of total expenses or income of the

company between activities covered under Appendix and other activities during the year

ending:

Serial

No.

10.

11.

12.

13.

14.

Particulars

Materials & supplies

Process materials

consumed

Utilities

(a) Power

(b) Fuel

(d) Effluent

Treatment

(e) Other (specify)

Direct Salaries and

wages

Consumable Stores

and Spares)

Repairs and

Maintenance

Depreciation

Transportation

Charges

Quality Control

Royalty or Technical

Know-how/Lease

rent

Research and

development

Works overhead

Administrative

overhead

Adjustment in

difference between

opening and closing

work in progress

Total

actual

expenses

Share applicable to

products covered under

Appendix

Plantation

Proces

sing

Others

(to be

specifi

ed)

applicable

to other

activities

Basis of

allocation

THE GAZETTE OF INDIA EXTRAORDINARY

[PART II—Si.<:. 3(i)]

ri5.

f6.

17.

18.

19.

20.

21.

22.

23.

24.

25.

26.

Less credit for

recoveries

Less self

consumption, if any,

Adjustment in

difference between

opening and closing

stock of finished

goods

Total (1 to 17)

Packing Expenses

Interest

Selling and

Distribution expenses

Any other expenses

not included in cost

Less any other

income not

considered in cost

Total cost excluding

Excise duty

Total Sales

realisation excluding

Excise Duty

Add: (1) Subsidy or

grant

from

Govt, or

Board.

(2)Export

Benefits and

incentives,

if any.

Margin (25-24)

Notes: -

1) Cost centers are illustrative only.

2) All items of income and expenditure in this Proforma shall be reconciled

with the financial accounts for the relevant period/year.

[F.No.52/21/CAB-2001]

RAJIV MEHRISHI, Jt. Secy.

Printed by the Manager, Govt, ot India Press. Ring Road. Mayapurl, New Dulhl-110064

and Published by tho Controller ol Publications. Delhi-110054 — 2002