Annual Report 2009 - Clariant

Annual Report 2009
Clariant Chemicals (India) Limited

Clariant Chemicals (India) Limited
Annual Report 2009
We enhance the quality of your life!
Clariant’s products span across a wide spectrum
of applications. You could find us in the most
unexpected areas, right from the wrinkle
free fabric, to the scratch free automotive
coatings, in the special pharma and plastic
packaging, on the leather sofas or in the heavy
metal free paints. Our initiatives on quality,
creating a broad range of green products, work
place ethics and safety help strengthen our
partnership with all of our stakeholders upon
whom our success depends. Ultimately we
strive to provide sustainable partnerships and
make our world a better place!

Index
2
Corporate Management
7 Financial Performance
9 Notice
13 Directors’ Report
17 Management Discussion and Analysis
22 Report on Corporate Governance
31 Auditors’ Report
34 Balance Sheet
35 Profit and Loss Account
36 Cash Flow Statement
38 Schedules to Balance Sheet
44 Schedules to Profit and Loss Account
46 Notes
58 Statement relating to the Subsidiary Company
59 Chemtreat Composites India Private Limited (Subsidiary)
67 Auditors’ Report on Consolidated Financial Statements
68 Consolidated Financial Statements
88 10-years’ Highlights

2 Clariant Chemicals (India) Limited
Annual Report 2009
Corporate Management
Peter Palm R.A. Shah Diwan A. Nanda
Bansi S. Mehta Henri Schloemer B.L. Gaggar Heiner Meier

3
AUDIT COMMITTEE
R.A. Shah, Chairman
Diwan A. Nanda
Henri Schloemer
INVESTORS’ GRIEVANCE COMMITTEE
Diwan A. Nanda, Chairman
Peter Palm
AUDITORS
Deloitte Haskins & Sells
Chartered Accountants
BANKERS
The Hongkong & Shanghai Banking Corpn. Ltd.
Standard Chartered Bank
Citibank N.A.
SOLICITORS & ADVOCATES
Crawford Bayley & Co.
REGISTRAR & SHARE TRANSFER AGENTS
BOARD OF DIRECTORS
R.A. Shah – Chairman
Peter Palm – Vice-Chairman & Managing Director
Bansi S. Mehta
Diwan A. Nanda
Heiner Meier
Henri Schloemer
Dr. Andreas Walde
B.L. Gaggar – Director Finance & Company Secretary
Sharepro Services (India) Pvt. Ltd.
Sakinaka, Andheri (E)
Mumbai – 400 072
REGISTERED OFFICE
Ravindra Annexe
194, Churchgate Reclamation
Mumbai – 400 020
WORKS
Dhatav, Roha, Dist. Raigad – 402 116
Balkum, Thane – 400 608
Kolshet Road, Thane – 400 607
Kudikadu, SIPCOT P. O., Cuddalore – 607 005
Singadivakkam Village, Kanchipuram – 631 561

4 Clariant Chemicals (India) Limited
Annual Report 2009
Exacting Solutions …
Clariant’s customers span across a wide range of businesses that
are the market leaders in their own ways. Our diversity highlights our
varied expertise and domain knowledge available for meeting the
specialized demands of the industry.
Clariant’s textiles business, a respected market leader in India, supplies
not just specialty chemicals for pretreatment, dyeing, printing and
finishing but also has the ability to impart special effects, from crease
resistance to moisture management as well as repellency. We cater to
varied segments like casual wear, sportswear, denim, business wear,
work wear, towels, upholstery, sarees and dress materials, medical
garments, textiles for cars, planes, trains and carpets.
Clariant is the leading manufacturer and supplier of pigments and
its preparations – be it for paints, plastics, printing inks, cosmetics,
detergents or special applications like latex, viscose or waxes.
Our high performance pigments meet the exacting demands of the
automotive, coil and coating industries. The halogen-free flame
retardants from the additives range are used for protective coatings,
resins, thermoplastics and polyester fibers.
Our paper specialties business is the preferred supplier of optical
brighteners, colorants and functional chemicals that impart superior
whiteness, color, coating and strength solutions for the paper market.
Our focused product range enhances both optical and functional
properties of all kinds of paper and board. We cater to segments
like: printing & writing, coated paper, tissue & toweling, packaging &
board, newsprint, among others.
Clariant is a leading supplier of leather chemicals and services in India,
offering chemical and technical solutions for the complete leather
manufacturing process, from beamhouse to finishing. We meet the
exacting demands of segments like automotive, shoe & fancy goods,
furniture, garment, fur, etc.

5
Our emulsions business is a major supplier of polymer dispersions to
paints, coatings, construction and adhesive industries. In water-based
wood coatings, the products have low VOC, no smell and quick drying,
thereby meeting the local demands of the industry. They also provide
good block resistance with enhanced gloss on wood and metals.
Clariant masterbatches has been recognized as an important specialty
and tailor made masterbatch supplier for the plastics industry. We
meet the exacting demands in many application areas like: automotive,
personal care, food & beverage, medical products, toys, fibers &
filaments, packaging film & sheet, agriculture applications, etc.
One of Clariant’s unique area of expertise is the high quality multifunctional
anti-graffiti coatings which are also corrosion resistant and
easy to clean. These find wide applications on the exteriors of railway
coaches, automobile bodies, etc.
The industrial & consumer specialties business is a global leader. Its
personal care business develops and produces specialty ingredients
and co-surfactants for skin and hair care, wet wipes and selected
pharmaceutical applications. The industrial and home care business
manufactures products for household cleaning fluids and disinfectant
applications. Our emulsifiers, lubricants and corrosion inhibitors
offer solutions for the lubricant and metal working fluid applications,
while our brake fluids meet the automotive industry’s demand. Our
industrial biocides are technology leaders in the coating segment.
We work closely with our customers - both multinational brands and
regional brands - to ensure performance, cost-efficiency and ecofriendliness.
Delivering personalized and high performance solutions through
close customer relationships which add value for our customers is
our hallmark.

6 Clariant Chemicals (India) Limited
Annual Report 2009
… for a better tomorrow!
Our basket of innovative products aim at ensuring our contribution to the broader sustainable development of the world we live in.
Eco-friendly solutions are integral to our pigment range – be it the lead/chrome/heavy metal free pigments for paints or the flame retardants that
are increasingly finding usage in varied applications, especially in the infrastructure sector in India. Our solutions also help conserve energy,
avoid excess usage and are VOC free. Our water-based emulsions are another example.
Clariant’s textile chemicals, especially for baby-wear, shirtings, bed-sheets, denims and trouser fabrics are compliant to global norms like
Oekotex, GOTS, EU legislations, etc. The 4E concept focuses on environment, efficiency, ecology and economy. The multi-functional anti-graffiti
coatings feature eco-friendly/energy savings and include non-fluorine compounds in formulations. Our specialized paper chemicals are wellsuited
for manufacture of recycled paper as. The leather product range provides environment-friendly value-added solutions for the specific
needs of the industry.
Clariant’s skin care formulations are based on raw materials from renewable resources; recycling concepts are used for aviation de-icing
products, which are promoted under our ECOTAIN label. Surfactant chemistry based on ethoxylates and specialty polyglycols offer state-of-theart
solutions for the current demands of the Indian market; e.g. VOC-free, low odour and APEO-free paint additives as well as formaldehyde free
preservatives. Our green preservative combined with our state-of-the-art manufacturing facility and an elaborate technical service offers the
perfect combination of product and service that enables our customers achieve exacting solutions for a better tomorrow!

7
Financial Performance
PBT and Margin
1800
1631
30
1500
25
(Rs. Million)
1200
900
600
648
508 493
1073
11.7
17.7
20
15
10
(%)
300
7.6 7.4
5.7
5
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
0
PBT Margin %
Distribution of Revenue 2009
(Rs. Million)
PAT and Margin
Taxes 550 (6%)
Exceptional items
245 (3%)
Profit after tax
1081 (12%)
1200
1000
1081
24
20
Other expenses
1066 (11%)
Depreciation /
Impairment
203 (2%)
(Rs. Million)
800
600
400
200
404
329
4.8 4.8
318
3.7
675
7.4
11.7
16
12
8
4
(%)
Personnel cost
616 (7%)
Cost of material
5452 (59%)
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
PAT Margin %
0
EPS, DPS and Payout
45
170.8
40.6
175
36
140
(Rupees)
27
18
9
82.8
15.2
11.0
16.4 *
18.0 **
11.9
98.1
10.0
25.3
87.8
19.0
72.1
25.0
105
70
35
(%)
0
April’05 -
March’06
April’06 -
December’06
FY 2007 FY 2008
FY 2009
0
EPS DPS Payout
(Earning per share) (Dividend per share) (Including Dividend Tax)
* Annualised ** Including Golden Jubilee Dividend of Rs 10

8
Clariant Chemicals (India) Limited
Annual Report 2009
Capital employed and ROCE
Net Working Capital to Sales
4200
3500
3880
3165 3135
3207
3498
48
40
1250
1000
1199
1128
1165
1008
20
16
(Rs. Million)
2800
2100
1400
21.0
30.9
32
24
16
(%)
(Rs. Million)
750
500
14.1
12.3*
13.5
11.0
699
7.6
12
8
(%)
700
10.4
13.8*
10.1
8
250
4
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
0
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
0
Capital Employed
ROCE
NWC
As % of Sales
* Annualised
* Annualised
Inventory to Sales
Receivable to Sales
1500
24
1800
24
1250
1253
1282
1127
1054
20
1500
1451
1374
1413
1321
1446
20
(Rs. Million)
1000
750
14.8
14.0 *
13.1
11.5
767
16
12
(%)
(Rs. Million)
1200
900
17.1
15.0*
16.4
14.4
15.7
16
12
(%)
500
8.3
8
600
8
250
4
300
4
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
0
0
April’05 -
March’06
April’06 -
December’06
FY 2007
FY 2008 FY 2009
0
* Annualised
Inventory
As % of Sales
Receivable
* Annualised
As % of Sales

9
Notice
NOTICE is hereby given that the Fifty-third Annual General
Meeting of the Members of Clariant Chemicals (India) Limited
will be held at Y. B. Chavan Auditorium, Gen. Jagannath Bhosale
Marg, Next to Sachivalaya Gymkhana, Mumbai-400 021, on Friday,
April 23, 2010 at 04.00 p.m. to transact the following business:
Ordinary Business:
1. To consider and adopt the audited Balance Sheet as at
December 31, 2009 and the Profit and Loss Account for the
year ended on that date and the Reports of the Directors and
Auditors thereon.
2. To confirm the declaration and payment of interim
dividend and to declare a final dividend for the year ended
December 31, 2009.
3. To appoint a director in place of Diwan A. Nanda, who
retires by rotation and being eligible, offers himself for reappointment.
4. To appoint the auditors and fix their remuneration.
Special Business:
5. To consider and, if thought fit, to pass, with or without
modification, the following resolution as an Ordinary
Resolution:
"RESOLVED THAT in accordance with the provisions of Section
257 of the Companies Act, 1956, Mr. Henri Schloemer, who
was appointed as an Additional Director pursuant to the
provisions of Section 260 of the Companies Act, 1956 and
Article 113 of the Articles of Association of the Company with
effect from January 1, 2010 and being eligible, offers himself
for re-appointment and in respect of whom the Company has
received notice in writing along with the prescribed deposit,
from a shareholder signifying his intention to propose him
as a candidate for the office of Director, be and is hereby
appointed as a Director of the Company liable to retire by
rotation.”
6. To consider and if thought fit, to pass with or without
modification, the following resolution as a Special
Resolution:
“RESOLVED THAT pursuant to the provisions of Sections 198,
269, 309, 310 read with Schedule XIII and all other
applicable provisions, if any, of the Companies Act, 1956,
approval of members be and is hereby accorded to
the appointment of Mr. Peter Palm as Vice-Chairman
& Managing Director of the Company for a period of
three years with effect from January 1, 2010 upon the
terms and conditions including remuneration, benefits
and perquisites payable or extended to him as set out
in the agreement executed between the Company and
Mr. Palm and provided in explanatory statement annexed to
the Notice convening this meeting.
RESOLVED FURTHER THAT Mr. Palm be paid a one time lump
sum compensation not exceeding Rs. 10 lakhs subject to the
deduction of tax, as relocation allowance and to reimburse
actual expenses incurred for shifting of his personal effects
from Leeds, UK to Mumbai, India.
RESOLVED FURTHER THAT in the event of any statutory
amendment, modification or relaxation by the Central
Government to Schedule XIII to the Companies Act, 1956,
the Board of Directors of the Company (hereinafter referred
to as ‘the Board’ which term shall be deemed to include
any Committee which the Board may constitute to exercise
its powers, including powers conferred by this resolution)
be and is hereby authorised to vary and/or increase the
remuneration including salary, commission, perquisites,
allowances, etc., within such prescribed limit(s) or ceiling
and the agreement between the Company and the
Vice-Chairman & Managing Director be suitably amended
to give effect to such modification, relaxation or variation
without any further reference to the members of the Company
in General Meeting.
RESOLVED FURTHER THAT, Mr. Palm shall not be subject
to retirement by rotation as per Article 127 of the
Articles of Association of the Company during his tenure as
Vice-Chairman & Managing Director.
RESOLVED FURTHER THAT for the purpose of giving effect
to this resolution, any Director and the Company Secretary of
the Company be and are hereby authorised to further execute
the necessary documents under the Common Seal of the
Company.
7. To consider and, if thought fit, to pass, with or without
modification, the following resolution as an Ordinary
Resolution:
“RESOLVED THAT pursuant to the provisions of Section
293(1)(a) and other applicable provisions, if any, of the
Companies Act, 1956, (including any statutory modifications
or re-enactment thereof) and subject to the consent, approval,
and permission being obtained from appropriate authorities to
the extent applicable and necessary, consent of the Company
be and is hereby accorded to the Board of Directors of the
Company (hereinafter referred to as the ‘Board’ which shall

10 Clariant Chemicals (India) Limited
Annual Report 2009
be deemed to include any committee thereof) to sell, transfer
and/or otherwise dispose off whole or substantially whole of
the Company’s assets consisting of property/land/undertaking
at the Balkum, Thane site of the Company with or without
the buildings, plant and machinery, equipment, furniture and
fixtures, infrastructure, facilities, auxiliaries, utilities attached
thereto the land, intellectual property rights, resources,
advantages, privileges, easement, benefits, exemptions,
rights, lease, tenancy, licenses, consents etc. in respect of
the said land and other assets attached or any part of it; to
such person(s) or entities at a price and on such terms and
conditions, as may be deemed fit by the Board in the best
interest of the Company.
RESOLVED FURTHER THAT the Board of Directors of the
Company be and is hereby authorised and empowered
to finalise and execute necessary documents including
agreements, deeds of assignment/conveyance and other
documents and to do all such other acts, deeds, matters and
things as may be deemed necessary and expedient in their
discretion for completion of transfer/sale/lease or otherwise
dispose off the said property, land and undertaking and to
give effect to this resolution.
RESOLVED FURTHER THAT the Board of Directors be and is
hereby authorized to delegate all or any of the powers herein
conferred in such manner as may be deemed fit”.
8. To consider and, if thought fit, to pass, with or without
modification, the following resolution as a Special
Resolution:
“RESOLVED THAT pursuant to Section 146 (2) of the Companies
Act, 1956 the registered office of the company be shifted
from Ravindra Annexe, 194 Churchgate Reclamation,
Mumbai-400 020 to Kolshet Road P.O. Sandoz Baug
Thane 400 607 within the state of Maharashtra.
RESOLVED FURTHER that for the purpose of giving effect to
this resolution, the Board of Directors of the Company be and
is hereby authorised to do all such acts, deeds, matters and
things and to execute all such deeds, documents, instruments
and writings and in its absolute discretion necessary or
desirable or in the best interests of the Company.
RESOLVED FURTHER that Mr. B. L. Gaggar, Director Finance &
Company Secretary be authorized to notify the said change in
the situation of the Registered Office of the Company to the
Registrar of Companies, Maharashtra”.
February 19, 2010.
Registered Office:
Ravindra Annexe,
194, Churchgate Reclamation,
Mumbai-400 020
By Order of the Board of Directors
For Clariant Chemicals (India) Limited
B. L. Gaggar
Director Finance & Company Secretary
NOTES:
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE
MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND
AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED
NOT BE A MEMBER OF THE COMPANY.
Proxy form in order to be effective must be received at the
registered office of the Company not less than 48 hours before
the meeting.
2. The relevant Explanatory Statement pursuant to Section 173
of the Companies Act, 1956 in respect of the special business
under Item Nos. 5 to 8 set out above is hereto annexed.
3. The Register of Members and Share Transfer Books of the
Company will remain closed from Tuesday, April 13, 2010 to
Friday, April 23, 2010 both days inclusive, for the purpose of
payment of final dividend, if declared at the Annual General
Meeting.
4. The final dividend on shares as recommended by the Board of
Directors, if declared at the meeting, will be paid:
(i) in respect of shares held in demat form on the basis
of beneficial ownership as per details furnished by the
Depositories as at the end of the business on April 12,
2010 and
(ii) in respect of shares held in physical form to those
members whose names appear on the Register of
Members of the Company after giving effect to all valid
share transfers lodged with the Share Transfer Agent
on or before April 12, 2010. The Company will dispatch
the dividend warrants on or after April 24, 2010.
5. Profiles of the Directors being re-appointed, as required under
clause 49 of the Listing Agreement, are provided in the report
on Compliance of Corporate Governance.
6. The amount outstanding in unpaid dividend account in respect
of financial year 2002-2003 will be transferred to the ‘Investor
Education and Protection Fund’ maintained with the Central
Government after the end of 7 (seven) years after July 23,
2010. Members who have still not encashed their dividend
are requested to encash the same at the earliest.
7. In case of any change of particulars including address, bank
mandate & nomination for shares held in demat form, should
be notified only to the respective Depository Participants
where the member has opened his demat account. The
Company or its Share Transfer Agent will not be able to act
on any direct request from these Members for change of
such details. However, any change in particulars in respect of
shares held in physical form, should be sent to the Registrars
& Share Transfer Agents of the Company.
8. Members holding shares in demat form may please note that
the bank account details given by them to their Depository
Participants (DPs) and passed on to the Company by such DPs
would be printed on the dividend warrants of the concerned
members. However, if any member(s) wants to receive
dividend in any other bank account, he/she should change/
correct the bank account details with their concerned DPs and
also intimate about ECS payment requirement. The Company

Notice
11
will not be able to act on any such request from shareholders
directly for deletion/change in the bank account details.
9. Members may please note that the Dividend Warrants are
payable at par at all the clearing branches of the HDFC
Bank Limited in India for an initial period of three months
only. Thereafter, the Dividend Warrant is payable only on
revalidation for a further period of three months. The members
are therefore, advised to encash Dividend Warrants within
the initial validity period.
10. Members who wish to attend the meeting are requested to
bring attendance slip sent herewith, duly filled in, and the
copy of the Annual Report. Copies of the Annual Report will
not be distributed at the meeting.
ANNEXURE TO THE NOTICE
Explanatory Statement under Section 173 of the Companies
Act, 1956
Item No. 5
At the meeting of the Board of Directors (“the Board”) of the Company
held on October 29, 2009 the Board appointed Mr. Henri Schloemer
as an additional director of the Company with effect from January
1, 2010 pursuant to Section 260 of the Companies Act, 1956, read
with Article 113 of the Articles of Association of the Company,
Mr. Schloemer holds office only up to the date of the forthcoming
Annual General Meeting.
Notice in writing has been received from a member of the Company
along with the prescribed deposit under Section 257 of the Companies
Act, 1956, signifying his intention to propose Mr. Henri Schloemer as
a candidate for the office of Director.
The Directors recommend the Resolution for Member’s approval.
No Director other than Mr. Henri Schloemer is concerned/interested
in this resolution.
Item No. 6
Mr. Peter Palm was appointed by the Board, as the Vice-Chairman
& Managing Director of the Company, for a period of three years,
with effect from January 1, 2010 on the remuneration, terms and
conditions subject to the approval of members.
The Directors recommend the approval of the special resolution
concerning the appointment of Mr. Palm. None of the Directors,
other than Mr. Palm, is concerned or interested in the resolution.
The information in respect of the terms of remuneration and
perquisites is given below:
Remuneration, benefits and perquisites
i. Salary:
Rs. 7,88,000/- (Rupees seven lakhs eighty eight thousands
only) per month, which may be increased by the Board of
Directors from time to time, subject to a maximum salary of
Rs. 9,45,000/- (Rupees nine lakhs forty five thousands only)
per month. Salary will be subject to the deduction of Income
tax at the applicable rates, under the Income Tax Act, 1961.
ii.
iii.
iv.
Contribution to PF:
Contribution to Provident Fund at the rate specified in the
Provident Fund Act and Rules thereunder calculated on salary
payable per month.
Commission:
Subject to the overall ceilings laid down under Sections
198 and 309 of the Companies Act, 1956, a fixed sum in the
range of Rs. 21,00,000/- (Rupees twenty-one lakhs only) to
Rs. 30,00,000/- (Rupees thirty lakhs only) per annum, as may
be decided by the Board from year to year.
Perquisites
a) Housing:
Suitable residential accommodation, free of cost with
all facilities, amenities and services (including gas,
electricity, water and furnishings). In case Mr. Palm
does not opt for Company provided accommodation
at any time, he shall be reimbursed the house rent
allowance of a sum not exceeding 70% of his salary.
The expenditure incurred by the Company on gas,
electricity, water and furnishings provided to him shall
be evaluated as per the Income Tax Rules, 1962.
b) Medical Reimbursement:
Reimbursement of medical expenses incurred by
Mr. Palm for self and family, in accordance with the
rules and regulations of the Company as may be in
force from time to time.
c) Leave and Leave Travel Concession:
Leave period of six weeks on full pay and allowances,
for every twelve months of service subject to the
condition that the accumulated leave shall not be
encashed. The Company will bear the full cost of leave
passage for Mr. Palm and his family once in a year to
any destination in India. In case it is proposed that the
leave be spent abroad, the Company will bear the full
cost of air passage by club class for Mr. Palm and his
family once in a year not exceeding the cost of return
passage to his home country.
d) Club Fees:
Mr. Palm shall be entitled to the reimbursement of
fees of any two clubs in India, including admission or
entrance fees and monthly or annual subscriptions.
e) Personal Accident Insurance:
The Company shall pay an annual premium of a sum
not exceeding Rs.15,000/- towards personal accident
insurance policy of Mr. Palm.
f) Reimbursement of expenses for returning to home
country:
Mr. Palm will be entitled to reimbursement of expenses
incurred by him for self and family for returning to his
home country after completion of his tenure of office
including actual expenses incurred on travel and on

12 Clariant Chemicals (India) Limited
Annual Report 2009
packing, forwarding, loading/unloading as well as
freight, insurance etc. in connection with the moving
of his personal effects.
g) Car, Driver & Telephone:
The Company will provide Mr. Palm a car and driver
and telephone at his residence for use on Company’s
business. Use of car for private purposes and personal
long distance calls on telephone shall be billed by the
Company to Mr. Palm.
In case the Company is not able to provide a driver to
Mr. Palm, the expenses for engaging a driver will be
reimbursed to him as per the Company’s rules.
h) Entertainment Expenses:
The Company shall reimburse entertainment expenses
actually and properly incurred by Mr. Palm in the course
of the business of the Company subject to such annual
limits as may be fixed by the Board of Directors of the
Company.
v) Limits on Remuneration:
The remuneration as specified in clauses above shall be
subject to the overall limits as specified under Sections 198,
269, 309 and other applicable provisions read with Schedule
XIII of the Companies Act, 1956.
vi)
vii)
Minimum Remuneration:
In the event of the Company incurring a loss or having
inadequate profits in any financial year, the remuneration,
benefits and perquisites payable or extended to Mr. Palm
shall be in accordance with the provisions of Section II of
Part II of Schedule XIII to the Companies Act, 1956 as amended
from time to time.
Termination:
This agreement may be terminated by either party by giving to
the other party six months’ notice of such termination.
viii) Vacation of Office:
If at any time during the tenure of his appointment as the
Vice-Chairman & Managing Director, Mr. Palm ceases to
be in the whole time employment of the Company for any
reason whatsoever, he shall also cease to be a Director of
the Company and simultaneously this agreement shall stand
terminated.
ix)
Sitting Fees:
Mr. Palm shall not be paid sitting fees for attending the
meetings of the Board of Directors of the Company.
Mr. Palm is not liable to retire by rotation during his tenure as
Vice-Chairman and Managing Director.
Item No. 7
Sale of Land/Premises at Balkum
In terms of Section 293(1) (a) of the Companies Act, 1956 sale, lease
or otherwise disposal of the whole, or substantially the whole of
undertaking of the Company, or where the Company owns more
than one undertaking, of the whole or substantially the whole of
any such undertaking requires approval of the shareholders by way
of an Ordinary Resolution.
The Company is holding about 36 acres of land at Balkum, Thane
and after completion of sale of Diketene and Intermediates
business together with its movable assets in terms of Business
Transfer Agreement, in January 2010, the site is currently used for
manufacturing operations of Phthalo Green pigments and various
site offices and laboratory set-up. The location earlier approved
for use by chemical industry by the Govt. of Maharashtra, is
currently surrounded by residential buildings. It is, therefore felt
that considering the Company’s commitment to environment,
safety and health of its people and society at large, the site is
not fit for continuing the operations as chemical factory and the
potential of the premises/land at site can be better realised for
use by other commercial/residential purposes. Since development
of infrastructure is not the core of the Company’s business, the
Board considered and thought it fit and proper that after closure,
divestment or sale of its existing business operations from Balkum
site and subject to approval of shareholders, the premises/land and
other assets attached thereto, may be sold in the best interest of the
Company and the value realised therefrom may be best put to use
for expansion/growth of the Company’s business.
The Directors recommend the Resolution for Member’s approval.
None of the Director is concerned/interested in this resolution.
Item No. 8
Proposal for change of registered office
As per provisions of Section 146(2) of the Companies Act, 1956 read
with proviso (b) thereto, shifting of registered office of a company
outside the local limits of any city or town requires approval of
shareholders by way of Special Resolution.
With a view to improve co-ordination and communication between
the corporate, marketing and site offices, the Board of Directors
considered and subject to approval of shareholders, approved the
proposal for shifting the registered office to Kolshet in Thane, where
the manufacturing site, marketing offices and the technology labs of
the Company are currently located. The proposed location is outside
the local limits of Mumbai city and therefore requires approval
of shareholders by way of special resolution. If approved, the
registered office will be moved to Kolshet Road, P. O. Sandoz Baug,
Thane 400 607 with effect from May 1, 2010.
The Directors recommend the approval of the special resolution.
None of the Directors is concerned or interested in the resolution.
February 19, 2010.
Registered Office:
Ravindra Annexe,
194, Churchgate Reclamation,
Mumbai-400 020
By Order of the Board of Directors
For Clariant Chemicals (India) Limited
B. L. Gaggar
Director Finance & Company Secretary

13
Directors’ Report
Your directors are pleased to present the Fifty-third annual report
and audited statement of accounts for the year ended December
31, 2009.
Financial Results
The financial performance of the Company for the year ended
December 31, 2009 is summarized below:
Rupees - Lakhs
2009 2008
Sales (Gross) 97322.24 100145.34
Less: Excise duty (5188.11) (8505.87)
Net sales 92134.13 91639.47
Profit before exceptional items & taxation 18761.13 10776.60
Less: Exceptional items (2450.46) (48.00)
Profit before taxation 16310.67 10728.60
Less: Provision for taxation (incl. FBT and deferred tax) (5466.34) (3732.21)
Less: Short provision for taxation – Prior years (30.77) (248.09)
Profit after tax 10813.56 6748.30
Add: Balance brought forward from previous year 1097.40 950.36
Amount available for appropriation 11910.96 7698.66
Appropriations :
General reserve 1081.36 674.83
Interim dividend 2666.07 —
Proposed final dividend 3999.11 5065.54
Corporate tax on dividend (interim & final proposed) 1132.75 860.89
Balance carried forward to balance sheet 3031.67 1097.40
Review of Operations
The global economic and financial crisis that began in 2008 and
continued to affect Indian economy till first half of 2009 had a
crippling impact on the global chemical industry. This has affected the
Company’s performance during the first 2 quarters of 2009. However,
unexpected recovery in domestic market and excellent performance
in terms of cost management has resulted into positive growth
in terms of sales and benchmarking performance in net profits of
your Company as compared to previous year. The following ratios
appropriately reflect your Company’s operational performance during
the year under review.
2009 2008
Sales growth (%) 0.5 6.4
Domestic sales growth (%) 2.8 7.0
Export sales growth (%) (8.3) 4.0
PBDIT (% to sales) 22.6 14.9
PAT (% to sales) 11.7 7.4
ROCE (%) 30.9 21.0
Debt : Equity ratio 0.01 0.01
Earning per share (Rs.) 40.56 25.31
Cash earning per share (Rs.) 48.19 36.49
Book value per share (Rs.) 130.45 119.14
Dividend
During the year, your directors had declared interim dividend of
Rs. 10 per share (100%) and the same was paid in August, 2009.
Considering the excellent performance for the year and the policy for
distribution of profits to the shareholders adopted by the Company,
the Board of Directors is pleased to recommend a final dividend of
Rs. 15 per share (150%).
The total dividend for the year ended amounts to Rs. 25 per share
(250%) as compared to Rs. 19 per share (190%) paid for the previous
year. On the paid-up share capital of Rs. 2666 lakhs, the total payout
on account of dividend and tax thereon for the year entails cash out
flow of Rs. 7798 lakhs (previous year Rs. 5926 lakhs) and pay out
of 72% of the net profit.
Divestment of Business
The Company, during the year sold its flexible laminating
adhesive business for a total consideration of Rs. 3.6 crores to
M/s. Bostik India Pvt. Ltd. The Company had also signed business
transfer agreement (BTA) with M/s. Laxmi Organic Industries Ltd.
for sale of its diketene and intermediates business located at
Balkum, Thane together with movable assets, technical knowhow
and non-compete undertaking for a total consideration of
Rs. 13.25 crores. On receipt of full consideration, the transaction is
concluded in January 2010 and the plant is being dismantled and
delivered to the buyer.
Registered Office
The registered office of the Company presently located at
Ravindra Annexe, 194, Churchgate Reclamation, Mumbai-400 020
is under lease and the premises is under major repairs. For better
co-ordination and effective communication between sites, offices
and laboratories, the Board has decided that subject to approval of
shareholders, the registered office of the Company be relocated at
Clariant owned premises at Kolshet Road, Thane-400 607 effective
from May 1, 2010. Shareholders are requested to approve the
proposal.
Balkum, Thane site
The Board of Directors of your Company has decided that subject to
the decision on closure, divestment or sale of its existing business
operations carried out at Balkum, Thane site and subject to approval
of shareholders, the land/premises and other assets attached
thereto, may be sold in the best interest of the Company and the
value realised therefrom may be best put to use for growth of the
Company’s business.
Shareholders are requested to consider and approve the proposal as
set out in notice of the annual general meeting.

14 Clariant Chemicals (India) Limited
Annual Report 2009
Fixed Deposits
The Company has not accepted fixed deposits during the year
under review. There were no overdue deposits except unclaimed
deposits of Rs. 6000/- as at December 31, 2009 which has been
subsequently deposited to Investor Education & Protection Fund
of Government in January, 2010. As per requirements of Section
205C of the Companies Act, 1956, the fixed deposits and interest
unclaimed after completion of seven years are transferred to
the Investor Education and Protection Fund established by the
Central Government. There is no amount due and outstanding
to be credited to Investor Education and Protection Fund as on
December 31, 2009.
Subsidiary Company
The audited accounts of the wholly owned subsidiary, Chemtreat
Composites India Private Limited along with Auditors Report thereon,
and the statement pursuant to Section 212 of the Companies Act,
1956, is a part of this annual report.
Consolidated Financial Statements
In accordance with the Accounting Standards (AS-21), notified
by the Companies (Accounting Standards) Rules, 2006, the
consolidated financial statements covered in this annual report
by the Company include financial information of its subsidiary
Chemtreat Composites India Private Limited and forms part of this
annual report.
Management Discussion and Analysis Report
The Management Discussion and Analysis Report forming part of
Directors’ Report for the year under review, as stipulated under
Clause 49 of the listing agreement with stock exchanges, forms part
of the annual report.
Corporate Governance
The Company is committed to maintain the highest standards
of corporate governance. The report on corporate governance as
stipulated under clause 49 of the listing agreement forms part of
the annual report. The requisite certificate from the auditors of the
Company confirming compliance with the conditions of corporate
governance as stipulated under the aforesaid clause is attached to
this report.
Particulars of Employees
The statement giving particulars of employees, as required
under Section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 as amended,
forms part of this report. However, having regard to the provisions
of Section 219(1)(b)(iv) of the said Act, the annual report excluding
the aforesaid statement is being sent to all the members of the
company. Any member interested in obtaining a copy of this
statement may write to the company secretary at the registered
office of the Company.
Directors
Consequent upon termination of agreement of Mr. Heiner Meier, as
Vice-Chairman and Managing Director, the Board at its meeting held
on October 29, 2009 considered and appointed Mr. Peter Palm as
Vice-Chairman and Managing Director of the Company effective from
January 1, 2010. The Board wishes to place on records its sincere
appreciation for Mr. Meier’s valuable contribution since integration
of Clariant group companies in India and welcomes the appointment
of Mr. Palm in his place. Mr. Peter Lindner, who was first appointed
as director of the Company on October 25, 2001 and Mr. Walter
Kindler, who was appointed as director on February 20, 2009 to fill
up the casual vacancy caused by resignation of Mr. Dominik Strebel
resigned from the Board with effect from January 1, 2010.The Board
at the meeting held on October 29, 2009 appointed Mr. Heiner Meier
as director to fill up the casual vacancy caused by resignation of
Mr. Lindner and Mr. Henri Schloemer as additional director with
effect from January 1, 2010. The Company has received notice
under Section 257 of the Companies Act, 1956 from a shareholder
proposing Mr. Henri Schloemer as a director of the Company.
In accordance with the provisions of the Companies Act, 1956 and
the articles of association of the Company, Diwan Arun Nanda, the
director of the Company is due to retire at the forthcoming annual
general meeting, and being eligible, has offered himself for reappointment.
Details of the directors seeking re-appointment are provided
in the Corporate Governance Report forming part of this report, as
required under Clause 49 of the listing agreement with the stock
exchanges.
Directors’ Responsibility Statement
In terms of Section 217(2AA) of the Companies Act, 1956 your
directors confirm that:
(a) in the preparation of the annual accounts, the applicable
accounting standards have been followed;
(b)
(c)
(d)
they have selected such accounting policies and 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 as at December 31, 2009
and of the profit of the Company for that year;
they have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the
provisions of the Companies Act, 1956 for safeguarding the
assets of the Company and for preventing and detecting fraud
and other irregularities;
they have prepared the annual accounts on a going concern
basis.
Conservation of Energy, Research and Development,
Technology Absorption, Foreign Exchange Earnings and
Outgo
Information required under section 217(1)(e) of the Companies Act,
1956 read with the Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988 is annexed hereto and
forms part of the report.

Directors’ Report
15
Auditors
M/s. Deloitte Haskins & Sells, Chartered Accountants, retires at the
conclusion of the ensuing annual general meeting and being eligible,
offer themselves for re-appointment. Members are requested to
appoint the auditors and fix the remuneration payable to them.
Cost Audit
The Board of Directors, in pursuance of an order under section 233B
of the Companies Act, 1956 issued by the Central Government, has
appointed M/s. R. Nanabhoy & Co., Cost Accountants, Mumbai, as
cost auditors to audit the cost accounts maintained by the Company
in respect of Dyes and Intermediates for bulk drugs for the financial
year 2009.
Acknowledgement
The Board of Directors place on record its sincere appreciation for
the dedicated efforts put in by all employees, their commitment and
contribution ensuring sustained operations that your Company has
achieved in most difficult and challenging environment during the
year. Your directors would like to record their sincere appreciation
for the support and co-operation that your Company received from
all the distributors, suppliers and business associates whom your
Company regards as partners in progress.
The Board of directors also express their appreciation of the
assistance and co-operation extended by the bankers and unstinted
support received from Clariant group companies.
Your directors thank the members for their confidence in the
Company.
Mumbai, February 19, 2010
For and on behalf of the Board of Directors
R. A. Shah
Chairman
Annexure to
Directors’ Report
Information as per section 217(1)(e) read with Companies (Disclosure
of Particulars in the Report of Board of Directors) Rules, 1988
and forming part of the Directors' report for the year ended
December 31, 2009.
FORM-A
Particulars with respect to conservation of energy
A. Power and fuel consumption:
1. Electricity:
a) Purchased:
2009 2008
Units (in ‘000 KwH) 49592 51119
Total amount (Rs. Lakhs) 2605 2316
Rate per Unit (Rs.) 5.25 4.53
b) Own Generation:
2. Coal
i) Through diesel generator
Units (in ‘000 KwH) 1650 1138
Units per Litre of diesel oil 3.28 3.19
Cost per Unit (Rs.) 10.58 11.56
ii) Through Steam turbine/ generator Nil Nil
Quantity (MT) 6178 3825
Total cost (Rs. Lakhs) 365 250
Average rate (Rs. per Kg.) 5.90 6.54
3. Furnace Oil (including L.S.H.S.)
Quantity (MT) 3712 2549
Total Cost (Rs. Lakhs) 755 698
Average rate (Rs. per Kg.) 20.40 27.38
4. Other internal generation Nil Nil
5. Agro mass briquettes
Quantity (MT) 8200 14475
Total cost (Rs. Lakhs) 334 537
Average rate (Rs. per Kg.) 4.08 3.71
6. Lignite / Fire wood
Quantity (MT) 2190 3083
Total cost (Rs. Lakhs) 35 48
Average rate (Rs. per Kg.) 1.58 1.54
B. Consumption per unit of production:
The Company manufactures a wide variety of products. The
products before reaching the finished final stage pass through
various operations in the different plants. It is, therefore, not
feasible to furnish the information in respect of consumption
per unit of production.

16 Clariant Chemicals (India) Limited
Annual Report 2009
FORM-B
Form of disclosure of particulars with respect to Technology
Absorption, Research & Development (R & D).
Research & Development
1. Specific Areas in which R&D carried out by the
Company:
R&D focused on two major aspects i.e. improved products and
cost reduction. In the competitive market of specialty chemicals
and colorants it is very much necessary to develop products
with better application properties and ease of application.
Improved product safety of products, especially for exports,
was another important area in which R & D worked. With the
increasing cost of raw materials, fuel and energies R & D’s
efforts were directed towards optimization of the processes
and operations of pigments, dyes, intermediates, surfactants
and other specialty chemicals from cost reduction point of
view.
2. Benefits derived as a result of the above R & D:
The new as well as improved products created additional
business and also helped to achieve customers’ satisfaction.
Process optimization lead to substantial cost reduction.
Development of eco-friendly processes resulted in lower
quantity of effluent and emission. Introduction of non toxic/non
hazardous products conforming to product safety regulations
resulted in higher and sustainable exports.
3. Future plan of action:
R & D will continue focus on projects leading to further cost
reduction, improved product safety and ecology.
4. Expenditure on R & D:
2. Benefits derived as a result of the above efforts, e.g. product
improvement, cost reduction, product development, import
substitution etc.
Benefits derived from these efforts include process
rationalization, product quality improvement, import
substitution and overall cost reduction.
3. In case of imported technology (imported during the last
5 years reckoned from the beginning of the financial year),
following information may be furnished.
(a) Technology imported : Nil
(b) Year of import : N.A.
(c) Has technology been fully absorbed : N.A.
Foreign Exchange Earnings and Outgo
2009
Rs. Lakhs
2008
Rs. Lakhs
1. Total foreign exchange earned 18064.41 19734.02
2. Total foreign exchange used 23689.50 22923.72
Mumbai, February 19, 2010
For and on behalf of the Board of Directors
R. A. Shah
Chairman
2009
Rs. Lakhs
2008
Rs. Lakhs
(a) Capital 3.36 9.93
(b) Revenue 224.20 323.29
(c) Total 227.56 333.22
(d)
Total R & D Expenditure as
percentage of total turnover 0.25% 0.36 %
Technology absorption, adaptation and innovation:
1. Efforts, in brief, made towards technology absorption,
adaptation and innovation:
The R & D department absorbs the knowledge of chemical
technology from various sources such as know-how from
the parent company and its worldwide affiliates, our own
experimental data bank, published literature etc. and
thereafter adapts the same to the Company's infrastructure.
While adapting technology care has to be taken that it suits
the locally available raw materials and production plants. Also
it is to be ensured that the raw material specifications are not
‘over demanding’ and the raw material cost is affordable. The
new/improved technology is used to effect improvements to
the products and processes as well as for the containment of
pollution.

17
Management Discussion & Analysis
Financial and Operational Performance
The year 2009 began with a very high degree of uncertainty
and volatility in the Indian as well as the global economy. The
sentiments, however, started improving in the later part of the
year with pick up in domestic demand. Despite all the challenges,
recession and downturns in the business all around the world,
your Company was able to sustain its business performance and
registered positive growth in sales and exceptional improvement in
net results. While domestic sales grew by 2.8%, export sales were
lower by 8.3%. Of the total sales revenue of the Company for the
year, 18.6% is contributed by exports. Efficient cost management at
all levels resulted in an impressive growth of 51.5% in profit before
depreciation, interest, exceptional items and tax (PBDIT) and 60.2% in
net profit after tax (PAT) over the previous year. The overall efficiency
has resulted into improvement in PBDIT from 15% to 22.6% and
PAT from 7.4% to 11.7% of sales as compared to the previous year.
These results in the tough macroeconomic environment reflect the
strength of the Company in the market place.
The Company has further consolidated its market leadership in the
highly competitive textile chemicals and leather dyes sectors. It is
constantly improving its market presence in other industry segments
it participates in.
The Company remains a zero debt company with no long-term
borrowings. Short-term borrowings are restricted to the need
based working capital requirements. The Company has created a
benchmark in efficient management of working capital. The year end
ratio of inventory to sales of 8.3%, receivables to sales of 15.7%
and net working capital (NWC) to sales of 7.6% is one of the best
in the specialty chemical industry. Net cash flow from operating
activities during the year was Rs. 17108 lakhs. Funds surplus to the
operational needs have been prudently invested to earn reasonable
returns with a high degree of safety. A sum of Rs. 12125 lakhs
(previous year Rs. 5459 lakhs) stands invested in debt schemes of
mutual funds at the end of the year.
During the year under review, all the plants had smooth operations
and the capacity utilisation was on need-based requirement. The
Company sold its non-core business of flexible laminating adhesives
and entered into a business transfer agreement for sale of its
diketene and intermediate business. Both these businesses during
the year contributed Rs. 8568 lakhs by way of net sales.
Achievement of ISO 9001, ISO 14001 and OHSAS–ISO 18001
certification from SQS (Swiss Association for Quality Management
System) for the Company’s Management Systems and for Environment
Management and Safety in its operations reflects yours Company’s
continuous commitment towards quality, safety and sustainable
environment friendly approach.
Business Segments and Performance
In accordance with the Accounting Standard – 17 notified by the
Companies (Accounting Standards) Rules, 2006, the Company has
reclassified its range of products into two reportable business
segments based on characteristics of products, production processes
and the class of customers.
1. Intermediates and Colours:
The intermediates and colours segment comprises of
pigments, pigment preparations, additives, intermediates and
masterbatches.
Clariant offers a wide range of products for optimal colour
and performance solutions. High performance pigments serve
a variety of industries including the automotive, architectural,
cosmetics, packaging and printing trades and the product
portfolio includes pigment preparations, special dyes, flame
retardants, high quality waxes and polymer additives.
The pigments and additives businesses of the Company
deal in pigments, their dispersions and diketene derivatives.
They have a strong presence in organic pigments serving
the needs of the paints, printing-inks, plastics, rubber,
detergents, cosmetics and other industries. Besides being an
important player in diketene chemistry, it has niche products
in the colourant range to meet specific customer needs. The
Company’s manufacturing facilities and state of art technical
service laboratories provide cutting edge technology which
helps in realizing the goals set by Clariant, for sustainable
growth of the business. The Company is focusing on the
promotion of lead- and chrome-free pigments and is spreading
the awareness on use of non-halogenated flame retardants.
The pigment and additives businesses of the company, during
the year, had good domestic growth of 6%, however negative
growth of 20% in exports resulted into net growth of -3%
over the previous year.
The Clariant’s masterbatches business is a world leader in
providing colour and additive concentrates and performance
solutions for the plastic industry and holds strong positions
in the packaging, consumer goods, automotive and fiber
segments.
The masterbatches business of the Company services the
plastic processing industry covering the product range of colour
concentrates, additive masterbatches and special mixtures of
pigments, additives, dispersing and wetting agents which
have applications in a variety of industrial and consumer
products such as automotive, packaging of pharmaceuticals,
personal care, food & beverage products, packaging
film & sheet, agriculture appliances, electrical connectors,

18 Clariant Chemicals (India) Limited
Annual Report 2009
wire & cables, medical equipment, household and consumer
products, food services, toys, fibers & filaments, compound
/ MRP and construction etc. Clariant is recognized as an
important supplier of specialty and tailor made masterbatches
for the processing of polymers like LDPE, HDPE, HM-HDPE,
PP, PVC, Nylon, PET, PBT and monofilaments, multi-filaments,
staple and nonwoven fibers for technical textile applications.
The masterbatches business, during the year, had an excellent
growth of 36% over the previous year. In order to cater to the
market potential of it’s product range, the Company is in the
process of expanding the capacities and setting up a green
field manufacturing facility in MIDC, Ambernath.
The total sales under this segment of Rs. 39267 lakhs
for the year comprises of pigments and additives of
Rs. 32866 lakhs, masterbatches of Rs. 5318 lakhs and
functional intermediates Rs. 1083 lakhs. The ratio of domestic
sales to export sales was 73:27. The segment contributes
43% to the total sales and registered a negative growth of
2.2% over previous year.
2. Dyes and Specialty Chemicals:
The Segment comprises of specialty chemicals and dyes
for the textile, leather and paper industry and performance
chemicals for personal care and industrial applications.
Clariant’s textile, leather and paper chemicals businesses
add value through functionality and aesthetics to the textile,
leather and paper industries and provide solutions to meet
customers’ needs across the entire production chain in the
user industry.
The Textile business serves textile producers as well as
retailers and brand owners with products and services for
pre-treatment, sizing, fibre finishing, dyeing and printing to
finishing. Clariant’s expertise in dyes and specialty chemicals
makes the Company a perfect partner in every step of the
textile process chain from fiber to finish. Clariant’s global
service Archroma® provides a solution to manage colour
standards along the whole textile chain and significantly
accelerates time to market. The Company is the market leader
in the segment of textile chemicals.
The Leather business develops and serves the market needs of
dyes and chemicals to process, treat and colour leathers and to
create specific effects and fulfil the performance requirements
of specific leather products. Market leadership in India in the
leather business is fortified with a comprehensive range of
dyes and wet end chemicals that cater to the retanning,
dyeing and finishing of all types of leather.
Clariant is the market leader in colourants and optical
brighteners for paper and it’s specialty chemicals provide
solutions, e.g. improve the strength of recycled paper. The
Company has established itself as one of the preferred
suppliers of dyes, optical brightening agents, surface and
process chemicals for the domestic paper industry.
During the year, the businesses of textile, leather and paper
had overall growth of 5% driven mainly by export growth of
100% over the previous year.
Clariant’s product portfolio based on surfactants, polymers
and active ingredients provide products and solutions for the
oil and gas industry and key ingredients for the home care and
cosmetic sector. A wide variety of global industries, such as
detergent, cosmetics, oil, gas, construction, agriculture, metal
working, mining, paint and aviation sectors use high-tech
functional chemicals in their products. Clariant is a dominant
player in the lubricant segment supplying brake fluids, engine
coolants and specialty additives and is a preferred supplier
of specialty ingredients for skin and hair care, wet wipes and
selected pharmaceutical applications in the personal care
segment. The Company is a leading supplier of biocides to the
coating and construction industries and a solution provider for
solvent recovery systems.
Given the product range, the strong brand image created by
the parent company coupled with capabilities of providing
technical services in product development and application
process, the Company is well positioned in this business
segment.
The total sales under this segment of Rs. 52867 lakhs for
the year comprises of Rs. 46352 lakhs (87.7%) from domestic
and Rs. 6515 lakhs (12.3%) from export sales. The Dyes and
Specialty Chemicals segment has contributed 57% of total
sales revenue for the year registering a growth of 2.7% over
previous year.
The segment wise financial performance of the Company is
summarised below:
(Rs. Lakhs)
Segments 2009
% to Total
Sales 2008
% to Total
Sales
Intermediates & Colours 39267 43% 40169 44%
Dyes & Specialty Chemicals 52867 57% 51470 56%
Total 92134 100% 91639 100%
Internal Control Systems
The Company has a comprehensive system of internal controls to
safeguard the Company’s assets against loss from unauthorized use
and ensure proper authorization of financial transactions. The system
is designed to provide a high degree of assurance regarding the
effectiveness and efficiency of operations, the reliability of financial
controls and compliance with applicable laws and regulations. The
organization is well structured and the policy guidelines are well
documented with pre-defined authority where monetary decision is
involved. Structured management information and reporting systems
together with an exhaustive budgetary control process for all major
operational activities form part of the overall control mechanism
to ensure that requisite information related to all operations are
reported and are available for control and review.
The Company has established a well laid out policy to maintain
the highest standards of environment, safety and health while
maintaining operational integrity. This policy is strictly adhered to
as per Clariant guidelines at all manufacturing sites.

Management Discussion & Analysis
19
The Company, with a view to encourage independent approach, has
outsourced the function of internal auditors to qualified professionals,
who conduct operational and system audits in accordance with an
audit plan adopted by the audit committee. Internal auditors as
part of their assignment, evaluate and assess the adequacy and
effectiveness of internal control measures and the compliance with
policies, plans and statutory requirements. The internal audit reports
are reviewed at audit committee meetings and appropriate action on
the recommendations is initiated by the management.
Human Resources
Human resources continue to be an invaluable and intangible asset
and key success factor for the Company to grow and sustain it’s
market position in a highly competitive and challenging environment.
Clariant firmly believes that people are the pivotal force behind
the growth and excellence in business operations. The overall
performance and the market position, the Company enjoys are the
result of the aggregate strength of it’s people.
The Company during the year, paid special attention to developmental
activities comprising of sharpening of skills and abilities, developing
academic and professional knowledge and cultivating appropriate
behavioral skill sets, such as improving interpersonal relations,
team building abilities, effective communication and presentation
skills. Focus on developing leadership skills and building talent for
the future and the process of improving organizational and human
capability through competency mapping of managerial positions in all
areas of the company’s operations, continued as a major initiative.
The Company has put great emphasis on the project “Clariant
Excellence” and has trained 4 black belts and 21 green belts in the
Lean Six Sigma process to identify further opportunities of cost
savings and process improvements.
The Company is committed to provide the right environment to
it’s employees to work and to inculcate a sense of ownership and
pride.
Cordial relations built on the strength of mutual trust and faith
in each other, prevailing at all locations, helped the Company in
downsizing the work force, earlier engaged in operations, which
are discontinued at Cuddalore in Tamilnadu and Balkum in Thane.
The voluntary retirement scheme, offering one of the best packages
prevalent in the industry, announced by the Company was well
responded to and a sum of Rs. 2810 lakhs were paid during the year
to 161 employees at all levels in the organisation. The total number
of employees on the rolls of the Company as at December 31, 2009
was 945 against 1,172 on December 31, 2008.
Industry Structure and Development
The Indian chemicals and petrochemicals industry is worth about
US$ 78 billion. The industry with investments worth US$ 60 billion,
contributes 3% to India’s GDP and 14% to total exports, employs
around 1 million is the largest in Asia and 12th in the world. Till the
recent slowdown, the industry was growing at 6%-10% per year,
as against the global average of 3%-4%. The industry exports more
than 50% of its production and thus is deeply connected to the global
economy. However, India’s share in global exports and imports is
less than 2%. The industry had an export growth rate of 27%, which
has come down to 16%, as a result of the global economic crisis.
Half of the chemical market is currently occupied by basic chemicals
such as petrochemicals and fertilizers. The rest comprises evenly
of specialty chemicals such as paints, dyestuffs and intermediates
and knowledge chemicals such as pharmaceuticals, bio chemicals
and agro chemicals. The growth rate of basic chemicals is 7-8% but
that of specialty and knowledge chemicals is 13-15% and a great
expectation is placed on its future growth.
India has achieved considerable progress in the production of basic
organic and inorganic chemicals, pesticides, paints, dyestuffs and
intermediates, petrochemicals, fine and specialty chemicals and
toiletry products. With the slash in tariffs, the Indian chemical
industry with well-built systems and segment focused operations is
likely to benefit further. It is not only the country’s oldest industry,
but contributes to India’s growing economy in a phenomenal way.
The industry is highly diversified and serves the basic needs of
many different industry verticals like natural gas, water, oil, metals,
minerals, air, oil, etc and all these verticals eventually bring into the
marketplace an array of products. The companies manufacturing high
value chemicals and compliant with industrial quality standards, are
capable of making their mark not just in India but in the overseas
markets as well.
Indian dyes are in demand world over. Pigments and Dyes are
primarily used in paints, inks, textiles, leather, paper, foodstuffs and
polymers. The textile industry accounts for the largest consumption
of dyestuffs. India has emerged as a global supplier of dyestuffs and
dye intermediates, particularly for reactive, acid, vat and direct dyes
approximately 6% of the world production. The total market of paint
and dyes is about US$ 1 billion with a growth rate of about 10%.
The dyestuff market is highly fragmented with high concentration
in Maharashtra and Gujarat. There are about 25 large and medium
players, which cover 50% market share, while 2000 other organized
players contribute the balance 50%. The per capita consumption of
dyestuff is very low in India (400 gms) as compared to the developed
countries (15 kgs). The plastics & polymer segment is growing steadily
with a very high potential of domestic consumption. It remains one
of the fastest growing markets in the recent past. Many overseas
plastic processors have started investing in India for exports as
well as for domestic consumption. However, the capacities of these
plants remain small.
The Indian textile industry size is estimated to expand significantly
from the present US$ 50 billion and it accounts for around 4% of
the Gross Domestic Products (GDP), 14% of Industrial production and
over 13% of the country’s total export earnings. The textile industry
is capital intensive and in recent years it has invested significantly
on capital assets by acquiring sophisticated new machinery. This
has gone a long way towards upgrading products to international
standards and massive investment is expected further. All this has
enabled the industry to entrench itself firmly and make an entry
into the society of top fashion, formal and leisurewear garments.
India is emerging as a one stop shop for all textiles and clothing
requirements. Clariant is a market leader in textile chemicals and
has a significant presence in all segments of the industry including
technical textiles.

20 Clariant Chemicals (India) Limited
Annual Report 2009
World trade in leather is estimated at about US$ 150 billion and
India’s share is US$ 3.5 billion despite having the advantage of a
large labour force and a wide raw material base. Dwindling exports
in the wake of the global demand slump and stiff competition from
countries like China and Vietnam have resulted into a fall in leather
exports by 17% in dollar terms and 8% in Rupee terms during the
nine months ended December 31, 2009 when compared with the
same period a year ago and the industry expects that the exports
during 2009-10 will show a decline of about 10-15%. Contrary to the
dismal show by the Indian leather industry, the Company has done
extremely well with a strong growth in exports led by Clariant Group
demand. The Company has a wide product range for leather dyeing
and finishing chemicals to cater to the market needs for a variety of
products and is the market leader in wet end chemicals.
The Rs. 16000 crore Indian paper industry is currently investing on
capacity expansion, pollution control measures and environmental
management plans. The total paper demand in the country according
to industry estimates is about 94 lakh tonnes a year with packaging
contributing to about 24% and newsprint 20%. Clariant’s paper
business offers a wide range of high performance products for
improving whiteness, strength, strong and bright shades with
excellent printability.
The Indian paint industry has seen remarkable changes during the
last decade. In this period, almost every major multinational has
established or entrenched their presence, incumbents have built
on their market position and the industry has become far more
sophisticated in terms of the products it manufactures, the way it
sells to customers and the range of technologies it uses. Overall
paint demand in India has grown 1.5 times the GDP growth, though
some segments have done better. The Company has positioned
itself as preferred supplier of pigments, additives and intermediates
to major paint, coatings and ink manufacturing companies in the
country.
The personal care sector in India is set for a lot of action by way
of expansion in capacity, fast replacement of product portfolio and
investment in research and development projects to sustain its
growth momentum in the Rs. 9500 crore personal care businesses.
Clariant with its strong global presence is looking forward for
improving its position in this segment.
The Company has diversified product ranges catering to the needs
of variety of user industries and these are classified into two broad
business segments of Intermediates and Colours and Dyes and
Specialty Chemicals. Details on these segments are described in
this report under ‘Segment wise performance’.
Outlook
In spite of deceleration from 9% GDP growth to about 7% GDP
growth in 2009-10, India remains the second largest growing
economy in the world. The index of industrial production has surged
by an incredible 16.8% in December 2009 against a contraction of
0.2% a year ago. For the period April-December 2009, the average
industrial growth rate worked out to 8.6%, much better than the
growth of 3.6% during the same period in 2008. Based on the growth
rate of the broad industry groups, the trend during the current year
is encouraging.
The Indian chemical industry is on a high growth trajectory and
through a series of efforts, expected to achieve USD 100 billion
in the upcoming years. The industry today is into manufacturing
of a wide range of goods including fine and specialty chemicals,
drugs and pharmaceuticals, dyes and pigments, agrochemicals
and fertilizers, pesticides, plastics and petrochemicals etc. and its
contribution to the Indian manufacturing sector is about 18%. The
positive factor for the Indian chemical industry is the demand for its
products that is largely driven by the domestic market. Considering
the very low per capita consumption ratio, it has great potential for
fast growth and with its inherent strengths of low cost and highly
qualified workforce, it is expected to play the role of an export base
to Europe and Middle East. However, the industry is yet to make
its presence felt in a significant way in the international markets
and factors like global recession and financial crises had significant
impact on the manufacturing and export sector of the industry.
Although 2009 has seen enough challenges, recession and
downturns, the Company has withstood all such pressures and
strongly positioned itself to meet the challenges of the future. While
some of the effects of the global economic scenario still persist, 2010
promises to be much better to forge ahead. Considering the strong
presence in different market segments, it’s technological ability
to provide solutions to user industries, rapid response in adapting
to change in fashion and preference of people, global affiliation
and brand image of Clariant world-wide, the future outlook of the
Company’s business is positive and sustainable growth is expected
in coming years.
Opportunities and Threats
The overall performance of the Indian chemical industry even
when the world is reeling under financial and economic recession
is satisfactory given the performance in the domestic markets.
Global recession is a reminder call for domestic industries to upgrade
the quality of products, technical services, cost competitiveness
and processing efficiencies, etc. Although small in size, the Indian
chemical industry is a net exporter. Per capita consumption in
each of its industry segment is very low and is about 1/10th
of world average, thus hold strong potential to grow in domestic
markets.
To counter the negative fallout of the global slowdown on the Indian
economy, the Government responded by providing a substantial fiscal
expansion in the form of tax relief to boost demand and increased
expenditure on public projects. In view of good performance by
industries, financial stimulus if rolled back, could affect domestic
demand in certain sectors for a temporary period.
The Business environment for the chemical industry globally has
been changing very fast and if the Indian chemical businesses have
to hold against competition they have to change and adopt their
strategies, methodology of working and organisational structure.
China is becoming the biggest threat to the Indian chemical industry
with their excess capacity and controlled exchange rate of Yuan,
making Indian products uncompetitive.
The area of challenge and concerns which the Indian chemical industry
will need to face are non-tariff barriers, by way of international
treaties, which at times appear well and innocuous but have been

Management Discussion & Analysis
21
used against the Indian chemical industry in the past and will have
to be reckoned with, as our industry makes inroads into global trade
in chemicals so far dominated by developed nations. A plethora of
taxes, levies and duties charged while transacting business within
and across states, often exceeds the duty barrier that exporters to
the Indian market face. The high cost of internal transactions needs
to be appropriately addressed so as to provide Indian manufacturers
a level playing field. India still has a problem of infrastructure like
insufficient power supply and underdeveloped road network.
Highly developed technology, in-depth research capabilities,
backward and forward linkages, development of domestic capacity
to decrease the dependence on imports are some of the crucial
factors that need to be taken into consideration. Nowadays, safety,
health and environment protection issues have become the majortalking
point in almost all industries and even in the Indian chemical
industry too. The Indian chemical manufacturers are addressing the
issue on a war-footing.
Government’s initiative to promote six Petroleum, Chemicals and
Petrochemical Investment Regions (PCPIR) is hoped to change
the fortunes for the Indian Chemical industry. Despite the difficult
time, the dyestuff and specialty chemicals industry holds a lot of
promise for India. The industry is a potential powerhouse benefiting
from comparative low labour costs, an excellent army of technical
manpower, capabilities for research and development facilities,
a huge and fast developing domestic market and the potential to
increase it’s share in global markets.
A diversified product range, proactive preparedness in adjusting to
demand and supply levels and aggressive customer support services
have provided a cushion to the Company to withstand the pressure
of global meltdown and downturn in the industry. With strong
technology support from the parent company, state of art product
development facilities, a world class product safety laboratory
with excellent product testing facilities and continuous emphasis
on cost management, the Company is well prepared to exploit the
opportunities both in the domestic and global markets to improve
it’s presence. The Company has placed continuous emphasis on cost
management.
Risks and Concerns
Clariant’s approach to Risk Management is designed to clarify risk
levels and encourage entrepreneurial behavior throughout the Group.
The Company’s risk management policy is in line with Clariant’s global
guidelines on risk management and adequate measures have been
adopted by the Company to combat various risks including business
risks (competition, consumer preferences, technology changes),
financial risks (cost, credit, liquidity, foreign exchange) hazard risks
(environment, safety and health), operational risks (system, process,
people) and regulatory and compliance risks.
The Company has adopted a focused approach towards risk
management in the form of a corporate insurance program which
has the goal of optimizing the financing of insurable risks by using
a combination of risk retention and risk transfer techniques. The
program covers any risks relating to business interruption resulting
from property damage and legal liability resulting from operations
and personal injury.
The Company has in place a responsive system to assess the
capabilities of all its vendors and distributors before being selected
and their performance is periodically reviewed for managing risks,
if any. The Company’s approach in providing solutions and servicing
it’s customers for over five decades, it’s attitude towards the vendors
and customers to consider them as it’s partners in progress provide
the Company requisite comforts to mitigate risks arising out of
competition and loyalty. The Company has put in place a system
driven credit control procedure and proactive approach to prepare
a liquidity planner and a constant review thereof to ensure that at
any given point of time there is adequate cover available to meet
its liabilities.
Clariant as a group is proactively committed to taking into
consideration environment protection and safety in all our activities.
Risk associated with protection of environment, safety of operations
and health of people at work is monitored regularly with reference to
statutory regulations prescribed by the government authorities and
guidelines defined by Clariant. The Company does not merely fulfill
the legal requirements concerning emission, waste water and waste
disposal, but actually works to even stricter self imposed standards.
The Company has created a benchmark of completing the internal
landmark of 50 lakhs man-hours of accident free working between
November 2007 and January 2010.
The Company’s business critical software is operated on a server with
regular maintenance and back-up of data. The global communication
network is managed centrally and is equipped to deal with failures
and breakdowns. Updated tools are regularly loaded to ensure a
virus free environment.
The Company operates within the letter and spirit of all applicable
laws. The Company has put in place a system driven legal compliance
manual and certification process that ensures compliance of
regulatory provisions and the same is periodically reviewed to
avoid any deviations and regularly updated to keep pace with the
regulatory changes. The Clariant code of conduct covers responsible
behavior, protecting the reputation of the company and reducing
risks for our shareholders.
Cautionary Statement
Certain statements under “Management Discussion & Analysis”
describing the Company’s objectives, projections, estimates,
expectations or predictions may be forward looking statement
within the meaning of applicable securities laws and regulations.
Although the expectations are based on reasonable assumptions,
the actual results could materially differ from those expressed or
implied, since the Company’s operations are influenced by many
external and internal factors beyond the control of the Company.
The Company assumes no responsibility to publicly amend,
modify or revise any forward looking statements, on the basis of
any subsequent developments, information or events

22 Clariant Chemicals (India) Limited
Annual Report 2009
Report on Corporate Governance
Company’s philosophy
Clariant Chemicals (India) Ltd., part of the Clariant Group, committed
to the highest standards of Corporate Governance, has over the years
practised good corporate governance and is committed to create
value to all its shareholders. The Company is driven by its core
values, viz. ethical practices, concern for people at work, delight of
customers and striving to meet the stakeholders’ expectations and
societal aspirations.
The Company believes that governance should be functioning
beyond compliances, adherence to regulatory frame work, financial
prudence and should create fair and transparent processes and
reporting systems. The focused approach, professionalism of Board
and fair and transparent processes have led your Company to new
heights. Corporate Governance has been strengthened by formulating
and adopting Code of Conduct for directors and senior members of
management. The Company makes best efforts to use best-in-class
technology, focus on providing solution and service to its customers
thereby creating value chain, promote highest levels of safety in its
operations, maintain better health of its employees, provide a clean
environment for sustainable development and meet the objectives of
shareholders by providing them fair returns and value.
1. Group Structure:
Your Company is an affiliate of Clariant AG, Switzerland, a global
leader in the field of specialty chemicals represented on five continents
with over 100 group companies and headquartered in Muttenz
near Basel. In accordance with the Group‘s business structure, the
Company operates in four business divisions viz. TLP (Textile, Leather
& Paper), P&A (Pigments and Additives), Functional Chemicals and
Masterbatches and these are classified in two business segments
Intermediates & Colours and Dyes & Specialty Chemicals.
2. Board of Directors
2.1 Composition and the Changes:
The Company as on December 31, 2009 had seven Directors
comprising of six non-executive Directors including
Chairman. The day to day management of the Company
is conducted by Vice-Chairman and Managing Director
subject to supervision and control of the Board of
Directors. The independent Directors take active part in the
Board and Committee Meetings, which adds value
in the decision making process of the Board of
Directors.
Mr. Heiner Meier led the team of management as Vice-
Chairman & Managing Director for the year. However, upon
termination of his agreement, Mr. Peter M. Palm is appointed
as the Vice-Chairman and Managing Director in his place with
effect from January 1, 2010. Mr. Dominik Strebel resigned
during the year and Mr. Walter Kindler was appointed in
the casual vacancy caused by his resignation. However,
Mr. Kindler resigned as Director as of December 31, 2009
and Mr. Henri Schloemer is appointed as Additional Director
effective from January 1, 2010. Mr. Peter Lindner resigned
as of December 31, 2009 and Mr. Heiner Meier is appointed
with effect from January 1, 2010, in the casual vacancy
caused by resignation of Mr. Lindner.
The composition and category of the Board of Directors as
at December 31, 2009, the number of other directorships/
committee memberships held by them and also the
attendance of the Directors at the Board meetings of the
Company is as under:
No. of other Directorships and Committee memberships/
Particulars of Attendance
Chairmanships in Indian Public Companies#
Name of the Director Category
Number of Board meetings Last AGM held Other Directorships* as Committee Committee
Held Attended on April 29, 2009 on December 31, 2009 Memberships Chairmanships
Mr. R. A. Shah
Non-Executive
6 6 Attended 14 10 5
DIN 00009851
Independent
Mr. H. Meier
Executive 6 6 Attended None 1 None
DIN 00726512
Mr. P. Lindner
Non-Executive 6 1 Attended None None None
DIN 01417833
Dr. A. Walde
Non-Executive 6 0 Not Attended None None None
DIN 01417867
Mr. B. S. Mehta
Non-Executive
6 6 Attended 14 10 5
DIN 00035019
Independent
Diwan A. Nanda
Non-Executive
6 4 Attended 5 3 1
DIN 00034744
Independent
Mr. Dominik Strebel Non-Executive 1 0 NA None None None
DIN 01859786
Mr. Walter Kindler Non-Executive 5 1 Attended None None None
DIN 02511867
* This excludes alternate directorships/directorships in private limited companies, foreign companies and companies governed by Section 25 of the Companies Act, 1956 wherever applicable.
# It excludes committees other than Audit Committee, Shareholders/Investor Grievance Committee and companies other than public limited company but includes committee membership/ chairmanship
in Clariant Chemicals (India) Ltd.

Report on Corporate Governance
23
2.2 Profile of Members of the Board of Directors being
appointed/re-appointed:
Mr. Peter Palm
Mr. Peter Palm a German national has done his Certificate
of Business Administration from Chamber of Commerce
Frankfurt Am Main awarded in 1970 and completed
management training in UK, Switzerland and other countries.
Before joining the Company as Vice-Chairman and Managing
Director he had international postings in India, Afghanistan,
Sri Lanka, Saudi Arabia, Nigeria, South Africa and since
the year 2005 he was Country President of Clariant UK &
Ireland.
Diwan A. Nanda
Diwan A. Nanda, a gold medalist from the Indian
Institute of Management, Ahmedabad has over 40 years
of vast experience in marketing & advertising and has
held various positions in academics and advertising.
He started his career in marketing in Hindustan Lever
Limited and later founded ‘Rediffusion’ an advertising
agency in 1973 and is on the board of Rediff.com India Ltd.
and Eveready Industries (India) Ltd. He is the recipient of
AAAI Premnarayan award for outstanding contribution to
advertising in India in 2002.
Dr. Henri Schloemer
Dr. Henri Schloemer, a German national, received his
doctorate degree in Business Administration from the
German University of Bochum. He joined Clariant 1998
and later became CFO for Clariant’s German operations. In
2007 he was appointed as Managing Director of Clariant
Germany and later in 2009 became Head of the Corporate
Affairs department at Clariant’s headquarters in Muttenz,
Switzerland, responsible for strategy, mergers & acquisitions
and worldwide regions for Clariant.
2.3 Board Meetings and Agenda:
In compliance with the provisions of clause 49 of the
listing agreement, the Board meets at least once in every
quarter to review the performance and to deliberate and
consider other items on the agenda. Six meetings were
held during the year on February 20, 2009, April 29, 2009,
May 14, 2009, July 24, 2009, October 29, 2009 and
December 14, 2009.
The agenda of the Board of Directors’ Meeting interalia
includes the following:
• Annual revenue and capital investment budgets;
• The unaudited quarterly, half-yearly financial results
and the audited annual accounts of the Company,
both consolidated and on a standalone basis
including segment wise revenue, results and capital
employed;
• Declaration of dividend;
• Sale of material nature, of investments, assets,
business, which is not in normal course of
business;
• Investment in capital projects of material nature;
• The minutes of the Board meetings of subsidiary
company;
• Minutes of the meetings of Board, Audit and
Investors’ grievance committees, as also the
resolutions passed by circulation;
• Internal audit reports and the status on
implementation of suggestions;
• Cost audit and secretarial audit reports;
• Proposals for joint venture, collaboration, merger &
acquisition, if any;
• Making of loans or investment of surplus funds;
• Appointment of statutory auditors, cost auditors &
internal auditors;
• Appointment of key management positions below
the Board level;
• Issues relating to shareholders – such as ratification
of transfers, demat status, pending grievances,
issue of duplicate share certificates, etc.;
• Materially important show cause, demand,
prosecution and penalty notices;
• Fatal or serious accidents, dangerous occurrences,
any material effluent or pollution problems;
• Defaults in payment of statutory dues, if any;
• Review of Foreign exchange exposure and exchange
rate movement, if material;
• Contracts in which Director(s) are deemed to be
interested;
• Matters requiring statutory/Board approvals;
• Review of related party transactions;
• Status on compliance of regulatory/statutory and
listing requirements;
• Issue/revocation of Power of Attorney;
• Commission payable to Directors;
• General notices of interest of Directors;
• Appointment of Managing and other Directors.
3. Board Committees:
The Board has constituted two committees viz., Audit
committee and Investor Grievance Committee. The roles and
responsibilities assigned to these committees covered under
the terms of reference approved by the Board are subject to
review by the Board from time to time and the minutes of
the meetings of these committees are reviewed and taken
note by the Board. The details as to the composition, terms
of reference, number of meetings and related attendance
etc. of these committees are provided below.

24 Clariant Chemicals (India) Limited
Annual Report 2009
3.1 Audit committee:
3.1.1 Composition:
Mr. R. A. Shah, Diwan A. Nanda and Mr. H. Schloemer are
the members of the Audit Committee after January 1, 2010.
Mr. Dominik Strebel was member of the Audit Committee
till February 20, 2009 and consequent upon his resignation
Mr. Walter Kindler was inducted as member of Audit
Committee till December 31, 2009. Mr. R. A. Shah chairs
the committee. The statutory auditors, internal auditors and
cost auditors are also invited to attend the audit committee
meetings from time to time. The composition of the Audit
committee meets the requirements of Section 292A of
the Companies Act, 1956 and Clause 49 of the Listing
Agreement.
Mr. H. Meier, the then Vice-Chairman & Managing Director
attended the Audit Committee meetings as special invitee.
Mr. B. L. Gaggar, Director Finance & Company Secretary
represents the finance function and also acts as Secretary
to the committee. All major variances affecting the
performance of the Company are discussed and explained.
During the year four meetings of the Audit Committee were
held on February 20, 2009, April 29, 2009, July 24, 2009 and
October 29, 2009.
Attendance at Audit Committee meetings:
Name of Director Category Status Number of Meetings
Held
Attended
Mr. R. A. Shah Independent Chairman 4 4
Diwan A. Nanda Independent Member 4 4
Mr. Dominik Strebel
(Up to February 20, 2009)
Mr. W. Kindler
(from February 20, 2009)
Non-Independent Member 1 0
Non-Independent Member 3 1
3.1.2 Scope of Audit Committee:
The Audit Committee assists the Board in fulfilling
its obligations relating to corporate accounting and
reporting practices, financial and accounting controls and
presentation of financial statements and thus provides
effective supervision of the financial reporting process. The
committee also reviews the appointment, independence
and performance of statutory auditors, the performance of
internal auditors and the Company’s internal control and
risk management policies. The terms of reference of the
audit committee are in accordance with clause 49(II) (D) of
the listing agreement entered into with the relevant stock
exchanges and include:
(i)
Overseeing the Company’s financial reporting
process and the disclosure of its information to
ensure that the financial statements are correct,
sufficient and credible;
(ii)
(iii)
Recommending to the Board, the appointment, reappointment
and, if required, the replacement or
removal of statutory auditors and fixation of fee for
audit and other services;
Reviewing with the management, the annual
financial statements before submission to the Board
for approval.
The Audit Committee is empowered to exercise
its rights under clause 49(II)(C) and also reviews
various information prescribed under clause 49(II)(E)
of the listing agreement entered into with the
relevant Stock Exchanges.
3.2 Remuneration Committee:
The Company has not constituted a remuneration Committee
as compensation/remuneration payable to the directors are
approved by the shareholders in the general meeting.
The Company has no pecuniary relationship or transaction
with its Non-executive directors other than payment of
commission, which has been approved by the shareholders
and payment of dividend on equity shares, if any, held by
directors in the Company. The Company has been seeking
legal consultations from M/s. Crawford Bayley & Co.,
Advocates & Solicitors on various matters and a sum of
Rs. 33,06,705 (Previous year Rs. 3,65,363) has been paid as
professional fees to the said firm during the year ended at
December 31, 2009. Mr. R. A. Shah, who is the Chairman
of the Company, is the senior partner of the said firm.
The aforesaid professional fee is not considered material
enough that may have potential conflict with the interest
of the Company and to impinge on the independence of
Mr. Shah.
The details of remuneration paid to Directors for the year
ended December 31, 2009 is as follows:
Rupees (in Lakhs)
Name of Director
Sitting
fees
Salary,
Perquisites,
Contribution
to Provident
Fund
Compensation
for loss
of office
Commission
Total
Mr. R. A. Shah 0.50 – – 4.00 4.50
Mr. H. Meier – 149.51 40.83 26.75 217.09
Mr. B. S. Mehta 0.45 – – 3.00 3.45
Diwan A. Nanda 0.50 – – 3.00 3.50
The Company has no scheme for grant of stock options to
the Directors.
3.3 Investors’ Grievance Committee:
The Investor’s Grievance Committee, during the year,
comprised of Diwan A. Nanda non-executive independent
director as Chairman and Mr. H. Meier Vice-Chairman
& Managing Director as a member. Consequent upon
the termination of agreement with Mr. H. Meier,

Report on Corporate Governance
25
Mr. Peter Palm replaces as member of the committee
effective from January 1, 2010.The committee, inter alia,
approves issue of duplicate share certificates and oversees
and reviews all matters connected with transfer of shares
of the Company. The committee also looks into redressal
of shareholders’ complaints related to transfer of shares,
non receipt of annual report and dividend warrant etc. The
committee monitors implementation and compliance of
the Company’s Code of Conduct for prohibition of insider
trading in pursuance of SEBI (Prohibition of Insider Trading)
Regulations, 1992. The committee met twice on April 29,
2009 and October 29, 2009 during the year and these were
attended by both the members.
To expedite the process of physical transfer of shares,
the Board has delegated the authority to Mr. B. L. Gaggar
Director Finance & Company Secretary who is the
compliance officer of the Company. In accordance with
the authority granted by the Board, Mr. Gaggar deals with
transfer/transmission of physical shares, split/sub-division
and consolidation of physical shares and rematerialisation
of shares. The physical transfers of shares are ratified at
the Board meetings.
M/s. Sharepro Services (India) Private Limited, the Registrar
and Share Transfer Agents, deals with all shareholders
related matters for both physical and demat holding. The
Company has retained the services of a practicing Company
Secretary to perform Secretarial Audit every quarter. No
non-compliance from established procedures is reported.
Pursuant to Clause 41 of the Listing Agreements, investor
grievance redressal status is reported every quarter to the
Stock Exchanges and the numbers of unattended grievances
are published in the news papers along with financial
results.
There was one investor complaint pending as on
December 31, 2009 which is being attended.
4. Subsidiary Company
The Company does not have material non-listed subsidiary
whose turnover or net worth (i.e. paid-up capital and free
reserves) exceeds 20% of the consolidated turnover or
net worth respectively, of the listed holding Company.
Chemtreat Composites India Private Limited, a wholly owned
subsidiary Company, has its production base at Khopoli,
in the Maharashtra state. As a majority shareholder, the
Company nominates its representatives on the Board of the
subsidiary company and monitors the performance through
quarterly review of financial statements by Audit committee
and review of minutes of the Board meeting by Company’s
Board.
Mr. Heiner Meier, Mr. Walter Kindler and Mr. B. L. Gaggar
were the Directors of Chemtreat Composites India Private
Ltd. Upon resignations of Mr. Meier and Mr. Kindler with
effect from January 1, 2010, Mr. Peter Palm and Mr. Henri
Schloemer are nominated as the Directors on the board of
subsidiary company.
5. General Body Meetings:
Location, date and time of the Annual General Meetings
of the Company held during the preceding 3 years and the
Special Resolutions passed thereat are as follows:
AGM Venue Date and
Time
50th
51st
52nd
Y. B. Chavan
Auditorium,
Gen. Jagannath
Bhosale Marg,
Next to Sachivalaya
Gymkhana,
Mumbai 400 021
Y. B. Chavan
Auditorium,
Gen. Jagannath
Bhosale Marg,
Next to Sachivalaya
Gymkhana,
Mumbai 400 021
Y. B. Chavan
Auditorium,
Gen. Jagannath
Bhosale Marg,
Next to Sachivalaya
Gymkhana,
Mumbai 400 021
April 19, 2007
4.00 p.m.
April 17, 2008
4.00 p.m.
April 29, 2009
4.00 p.m.
Special Resolutions
Passed
No special resolution.
i) Enhancement of the
borrowing limits of the
Company from
Rs. 125 crores to Rs. 300
crores.
ii) Payment of commission
to the Directors other
than Managing Director.
i) Re-appointment of
Mr. H. Meier as the
Vice-Chairman &
Managing Director.
ii) Amendment of Articles
of Association of the
Company.
There was no postal ballot conducted during 2009 and any
of the preceding three years.
6. Disclosures:
6.1 Materially significant related party transactions:
The Company has not entered into any transactions of
material nature, with its promoters, the directors, or the
senior management personnel, their subsidiaries or relatives
etc. that may have potential conflict with the interests of
the Company. The disclosure in respect of related party
transactions is provided in the notes to the accounts. All
contracts with the Clariant affiliates entered into during
the year are in the normal course of business and have no
potential conflict with the interest of the company at large
and are carried out on an arm’s length basis at fair market
value.
6.2 Code of Conduct
The Board of Directors has adopted the Code of Conduct
for Directors and senior management personnel and the
same has been placed on the Company’s website. The
Code has been circulated to all the members of the Board
and senior management personnel and the compliance
of the same is affirmed by them annually. In addition, a
standard international Code of Business Conduct formulated
by Clariant Group is applicable to all employees of the
Company.

26 Clariant Chemicals (India) Limited
Annual Report 2009
The Vice-Chairman & Managing Director has confirmed the
compliance of code of conduct and as required under subclause
I(D) of clause 49 of the listing agreement given a
declaration as under:
“In accordance with sub-clause I(D) of Clause 49 of the
Listing Agreement with the Stock Exchanges, I hereby
confirm that, all the Directors and the Senior Management
Personnel of the Company have affirmed compliance with
the code of conduct applicable to them, for the year January
to December, 2009”.
6.3 Prohibition of Insider Trading:
The Company has framed its Insider Trading Regulations
wherein rules for the preservation of price sensitive
information, pre-clearance of trade, monitoring and
implementation are framed. This code is applicable to all
Directors and such employees of the Company who are
incidental to have access to unpublished price sensitive
information relating to the Company. Transaction for dealing
in the prescribed volume of the security of the Company
during the prescribed time requires prior approval from the
Company.
None of the Directors is holding any shares in the Company
as on December 31, 2009.
7. Means of Communication:
• The Company has 30,656 shareholders as on
December 31, 2009. The main channel of
communication to the shareholders is through
annual report which includes inter alia, the
Directors’ Report, the Auditors Report, Report
on Corporate Governance, Audited Financial
Statements, Consolidated Financial Statements
and other important information. The Management
Discussion and Analysis Report forms part of the
Annual Report.
• The website of the Company www.clariant.in acts
as the primary source of information regarding
the operations of the Company. Quarterly financial
results and media releases are being displayed on
the Company’s website.
• The Annual General Meeting is the principal forum
for face-to-face communication with shareholders,
where the Board responds to the specific queries of
the shareholders.
• Quarterly results, approved by the Board of
Directors and submitted to the Stock Exchanges
in terms of the requirements of clause 41
of the Listing Agreement are published in the
prominent English publications such as Financial
Express/Business Standard and prominent
vernacular publications such as Maharashtra Times/
Nav Shakti/Sakal.
8. General Shareholder Information:
8.1 Annual General Meeting
Date & Time:
Friday, April 23, 2010 at 04.00 p.m.
Venue:
Y. B. Chavan Auditorium, Gen. Jagannath Bhosale Marg,
Next to Sachivalaya Gymkhana, Mumbai-400 021.
8.2 Voting rights:
In terms of Articles 93 to 105 of the Articles of Association
of the Company, every member present in person or proxy,
attorney or representative at the general meeting of the
members shall have the following voting rights:
• On a show of hands: one vote for a member present
in person;
• On a poll: one vote for each equity share registered
in the name of the member or held by the beneficial
owner;
• Proxy has no right to speak.
8.3 Financial Calendar:
The Company’s financial year is period of twelve months
from January to December.
Dates for Audited/Unaudited Results:
Financial Year
January-December
2009
Financial Year
January-December
2010 (Proposed)
January – March April 29, 2009 April 23, 2010
April – June July 24, 2009 July, 2010
July – September October 29, 2009 October, 2010
October – December February 19, 2010 February, 2011
Annual General Meeting April 23, 2010 April, 2011
8.4 Dates of Book Closure
Book Closure dates
January-December
2010
April 13, 2010 to
April 23, 2010 (Both days
inclusive)
Payment of Dividend On or after April 24,
2010
January-December
2011 (Proposed)
Second fortnight of April
2011
Immediately after AGM

Report on Corporate Governance
27
8.5 Listing of Shares:
Shares of the Company are listed on Bombay Stock Exchange
Ltd. (BSE) and National Stock Exchange of India Limited
(NSE).
The Company has paid the listing fees upto March 31, 2010
to both the Stock Exchanges.
8.6 Stock Code:
Name of the Stock
Exchange
Stock Code
BSE CLARICHEM Rs. 467.90
NSE CLNINDIA Rs. 470.40
Closing Price as on
31.12.2009
Company Registration Number with ROC/Ministry of
Corporate Affairs
CIN : L24110MH1956PLC010806
ISIN : INE492A01029
8.7 Stock Market Data Price Rupees per share:
Month
Bombay Stock Exchange
(BSE)
2009 High Rs. Low Rs. Volume
(Nos.)
National Stock Exchange
(NSE)
High Rs. Low Rs. Volume
(Nos.)
January 179.90 145.00 92853 179.65 145.00 39013
February 175.90 144.30 563745 175.50 146.10 413017
March 205.00 164.00 934184 205.00 162.70 346991
April 213.85 153.00 344594 214.40 170.00 415259
May 246.00 175.10 454303 245.80 180.10 418189
June 277.00 224.05 305460 272.80 225.25 155536
July 318.65 233.00 248523 326.40 234.50 122695
August 320.00 279.00 157878 314.75 280.00 141513
September 367.00 308.00 229551 367.00 309.00 183248
October 389.90 350.00 204675 390.00 351.05 124781
November 422.95 360.10 176262 424.00 352.50 132042
December 485.00 349.90 600612 485.00 400.10 569941
8.8 Performance of Company’s shares to broad based
index (BSE Sensex):
8.9 Address for correspondence:
Registrar & Share Transfer Agents:
M/s. Sharepro Services (India) Pvt. Limited,
A) 13-AB, Samhita Warehousing Complex,
Gala No. 52-56
2nd Floor, Sakinaka Tel. Exchange Lane,
off Andheri-Kurla Road,
Sakinaka,
Mumbai-400 072.
Tel: 022-6772 0400/6772 0300,
Fax: 022-2859 1568, 2850 8927
Email: sharepro@shareproservices.com
Contact Person: Mrs. Indira Karkera/ Miss Priya
E-mail ID under clause 47(f) of the
Listing Agreement :
Clariant@shareproservices.com
B) Investor Relations:
912, Raheja Centre,
Free Press Journal Road,
Nariman Point,
Mumbai-400 021.
Tel.: 022-2288 1568/69, 6613 4700
Fax: 022-22825484
The shareholders having physical shares are requested
to ensure that any correspondence for change of
address, change of bank mandates etc. should be
signed by the first named shareholder. You are further
requested to send supporting documents such as proof of
residence, copy of PAN card whenever change of address
is to be effected.
In case where the shares of the Company are held in electronic
form (that is, in dematerialised form), all communications
concerning rematerialisation of shares, transfer and
transmission, dividends, change of address, furnishing
of alterations in bank account details, nominations, ECS
credit of dividend amount to shareholders’ bank account or
other inquiries should be addressed only to the Depository
Participant (DP) with whom demat account is maintained,
quoting client ID number and not to the Company or the R&T
Agent . This is because once the shares are dematerialised
they become fungible i.e., they lose their distinct identity
such as the folio number, the certificate number, the
distinctive share numbers, etc. and the corresponding credit
for number of shares is given to the individual shareholder
in his account with the concerned DP.
For any assistance from the Company, members may
contact Mr. S. P. Bhattu, Assistant Company Secretary at
the registered office of the Company.
Tel. No. 022-22022161/2283 0882

28 Clariant Chemicals (India) Limited
Annual Report 2009
8.10 Shareholding Pattern as on December 31, 2009
Sr.
No.
Category
A. Promoter's Holding:
No. of
Shares held
Percentage of
Shareholding
Foreign Promoters
i Ebito Chemiebeteiligungen AG 8167080 30.63
ii Clariant International AG 6075000 22.79
iii Clariant Participations AG 2660000 9.98
Sub-Total 16902080 63.40
B. Institutional Investors
i Mutual Funds / UTI 1151551 4.32
ii Financial Institutions / Banks 20067 0.07
iii Insurance Companies 479588 1.80
iv Foreign Institutional Investors 58815 0.22
Sub-Total 1710021 6.41
C. Non-Institutional Investors
i Bodies Corporate 1489332 5.59
ii Individuals
a) individual shareholders holding 5748845 21.56
nominal share capital up to
Rs.1 lakh
b) individual shareholders holding 669395 2.51
nominal share capital in
excess of Rs. 1 lakh
iii others
a) Non-Resident (Non-Rep) 72270 0.27
b) Non-Resident (Rep) 48168 0.18
c) Trust 18784 0.07
d) OCB 1850 0.01
Sub-Total 8048644 30.19
TOTAL 26660745 100.00
2,56,09,068 shares of the Company are held in dematerialised
form constituting 96.06% of the paid-up capital, as at
December 31, 2009. The total number of shareholders as on
Benpos date of December 31, 2009 is 30,656.
8.11 Details of Members holding > 1 % of the paid up
capital of the Company
Sr.
No
Name
As at
December 31, 2009
No. of
shares
As at
December 31, 2008
% No. of
shares
1. Ebito Chemiebeteiligungen AG 8167080 30.63 8167080 30.63
2. Clariant International AG 6075000 22.79 6075000 22.79
3. Clariant Participations AG 2660000 9.98 2660000 9.98
4. UTI (thru its various schemes) 572000 2.15 566297 2.12
5. Finquest Securities Pvt. Ltd.
(Held under 4 folios)
%
535766 2.01 Nil Nil
6. UTI Master Value Fund 264243 0.99 289071 1.08
8.12 Distribution of shareholdings as at December 31, 2009
No. of equity shares
held
Shareholders
Equity Shares held
Numbers % No. of shares %
1 – 500 28190 91.956 2836121 10.638
501 – 1000 1436 4.684 1069610 4.012
1001 – 2000 575 1.876 833575 3.127
2001 – 3000 157 0.512 394096 1.478
3001 – 4000 83 0.271 293416 1.101
4001 – 5000 69 0.225 320948 1.204
5001 – 10000 84 0.274 598984 2.247
10001 & above 62 0.202 20313995 76.194
Total 30656 100.000 26660745 100.000
8.13 Dematerialisation of shares and liquidity
Names of Depositories for dematerialisation of equity
shares:
Name of the Depository
National Securities Depositories Limited (NSDL)
Central Depository Services (India) Limited (CDSL)
ISIN No.
INE492A01029
INE492A01029
Trading in equity shares of the Company is permitted only in
dematerialised form.
8.14 ADRs/GDRs/Warrants
The Company has not issued any GDRs/ADRs/Warrants or
any other convertible instruments.
8.15 Plant Locations:
(i) The Company’s manufacturing facilities are located at
(ii)
(a)
(b)
(c)
(d)
Balkum Village, Thane-400 608 (Maharashtra)
Kolshet Road, Thane-400 607 (Maharashtra)
113/114, MIDC, A.V.P.O. Dhatav, Roha,
Dist. Raigad-402 116 (Maharashtra)
Kudikadu, P.O., Cuddalore-607 005 (Tamil Nadu)
(e) Singhadivakkam Village, Kanchipuram-631 561
(Tamil Nadu)
The Company’s wholly owned subsidiary company’s
(Chemtreat Composites India Private Limited) plant
is located at Village Savaroli Survey No. 109,
110, 112 Kharpada Road, Tal Khalapur, Khopoli
Dist. Raigad-410 203 (Maharashtra)
9. Additional Information:
9.1 Dividend for the year ended December 31, 2009:
The final dividend recommended by the Board for the year
will be paid after approval of shareholders at the forthcoming
Annual General Meeting to all those shareholders whose
names appear – in respect of shares held in demat form, as
beneficial owner, as per details furnished by the depositories
as at the end of the business on April 12, 2010 and

Report on Corporate Governance
29
In respect of shares held in physical form as members in the
register of members of the Company after giving effect to all
valid share transfers lodged with the share transfer agent
on or before April 12, 2010. The Company will dispatch the
dividend warrants on or after April 24, 2010.
9.2 Unpaid / Unclaimed Dividend:
In terms of the amended provisions of Section 205C of the
Companies Act, 1956 the Company is obliged to transfer
dividends which remain unpaid or unclaimed for the period
of seven years from the date of declaration of dividend
to the credit of the Investor Education and Protection
Fund established by the Central Government. Accordingly,
the Company has transferred unpaid/unclaimed dividend
up to the financial year 2001-2002 to the fund and no claim
shall lie against the Company or the fund in respect of
dividends remaining unclaimed or unpaid and transferred to
the Fund.
Members are hereby informed that the seven years period
for payment of the dividend pertaining to financial year
2002-2003 will expire on 24.07.2010 and thereafter the
amount standing to the credit in the said account will be
transferred to the ‘Investor Education and Protection Fund’ of
the Central Government. Members are therefore requested
to encash the dividend at the earliest.
Dates of transfer of unclaimed dividend to the Fund
Financial Year/period
Date of Payment
Date of completion of
seven years
2002-2003 25.07.2003 24.07.2010
2003-2004 30.07.2004 29.07.2011
2004-2005 29.07.2005 28.07.2012
2005-2006 27.07.2006 26.07.2013
April-Dec. 2006 19.04.2007 18.04.2014
2007 17.04.2008 16.04.2015
2008 29.04.2009 28.04.2016
2009 (Interim) 24.07.2009 23.07.2016
9.4 Nomination Facility:
A member can nominate a person who shall have rights
to shares and/or amount payable in respect of shares
registered in his name in the event of his death. This facility
is available to the members of the Company. The said
form can be obtained from the Company’s Share transfer
agent or downloaded from the website of the Company
at www.clariant.in
9.5 Consolidation of folios and avoidance of multiple
folios:
Members having multiple folios are requested to consolidate
their folios into single folio and for this purpose send request
along with the original certificates along with a request to
the Share Transfer Agent specifying the folio number under
which they desire to hold the shares.
9.6 Compliance
The Company has complied with all requirements of
regulatory authorities. No penalties/strictures were imposed
on the Company by stock exchanges or SEBI or any statutory
authority on any matter related to capital market during the
last three years.
10. CEO/CFO Certification
The Vice-Chairman & Managing Director and the Director
Finance & Company Secretary have provided annual
certificate on financial reporting and internal controls to
the Board pursuant to clause 49. They have also provided
quarterly certificates on financial results while placing the
financial results before the Board pursuant to Clause 41.
Mumbai, February 19, 2010
On behalf of the Board of Directors
R. A. Shah
Chairman
9.3 Bank Mandate:
Electronic Clearing Services (ECS) is a method of payment of
dividend whereby the amount due to investors can directly
be credited into their bank accounts, without having to
issue paper instruments. It is fast and there is no scope for
loss of dividend warrants in transit and possible fraudulent
encashment.
In case of shares held in physical form the bank details may
be sent to the registrar & share transfer agents. In case of
shares held in demat form, the bank details provided by the
Depository Participant (DP) with whom the demat account
is maintained will be applicable. All previous instructions
given by you to the Company in respect of ECS and bank
details will stand superseded by the ECS details recorded
with your DP.

30 Clariant Chemicals (India) Limited
Annual Report 2009
Auditors’ Certificate on Corporate Governance
To The Members of Clariant Chemicals (India) Limited
We have examined the compliance of conditions of Corporate Governance by Clariant Chemicals (India) Limited, for the year ended
December 31, 2009 as stipulated in Clause 49 of the Listing Agreement of the said Company with the Stock Exchange(s).
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures
and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an
audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and based on the representations made by
the Directors and the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in
the above mentioned Listing Agreement.
We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which
the Management has conducted the affairs of the Company.
For Deloitte Haskins & Sells
Chartered Accountants
Reg. No. 117365W
A. C. Khanna
Partner
Mumbai, 19th February, 2010 Membership No.: 17814

31
Auditors’ Report
To the Members of Clariant Chemicals (India) Limited
1. We have audited the attached Balance Sheet of Clariant Chemicals
(India) Limited, as at December 31, 2009 and also the Profit and
Loss Account and the Cash Flow Statement for the year ended
on that date annexed thereto. These financial statements are the
responsibility of the Company’s management. Our responsibility
is to express an opinion on these financial statements based on
our audit.
2. We conducted our audit in accordance with auditing standards
generally accepted in India. Those Standards require that we
plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
the management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
(d)
(e)
(f)
in our opinion, the Balance Sheet, Profit and Loss Account
and Cash Flow Statement dealt with by this report comply
with the Accounting Standards referred to in sub-section
(3C) of Section 211 of the Companies Act, 1956;
on the basis of the written representations received from
the directors, as on December 31, 2009 and taken on
record by the Board of Directors, we report that none
of the directors of the Company is disqualified as on
December 31, 2009 from being appointed as a director,
in terms of clause (g) of sub-section (1) of Section 274 of
the Companies Act, 1956; and
in our opinion and to the best of our information and
according to the explanations given to us, the said
accounts give the information required by the Companies
Act, 1956, in the manner so required and give a true and
fair view in conformity with the accounting principles
generally accepted in India:
3. As required by the Companies (Auditor’s Report) Order, 2003 (the
‘Order’) issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956, we
enclose in the annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order to the extent applicable to
the Company.
4. Further to our comments in the Annexure referred to in paragraph
3 above, we report that:
(i)
(ii)
(iii)
in the case of the Balance Sheet, of the state of
affairs of the Company as at December 31, 2009;
in the case of the Profit and Loss Account, of the
profit of the Company for the year ended on that
date; and
in the case of the Cash Flow Statement, of the cash
flows for the year ended on that date.
(a)
(b)
(c)
we have obtained all the information and explanations,
which to the best of our knowledge and belief were
necessary for the purposes of our audit;
in our opinion, proper books of account as required by
law have been kept by the Company, so far as appears
from our examination of the books;
the Balance Sheet, Profit and Loss Account and Cash Flow
Statement dealt with by this report are in agreement with
the books of account;
Mumbai: February 19, 2010
For Deloitte Haskins & Sells
Chartered Accountants
Registration No. 117365W
A. C. Khanna
Partner
Membership No. 17814

32 Clariant Chemicals (India) Limited
Annual Report 2009
Annexure to the Auditors’ Report
[Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Clariant Chemicals (India) Limited
on the financial statements for the year ended December 31, 2009.]
(i) (a) The Company has maintained proper records showing
full particulars including quantitative details and
situation of fixed assets.
(b)
(c)
The Company has a programme of physical verification
of fixed assets. As per the said programme, certain
assets were physically verified during the year. In our
opinion, the frequency of verification is reasonable
having regard to the size of the Company and the
nature of its assets. According to the information and
explanations given to us, no material discrepancies
were noticed on such verification.
In our opinion, fixed assets disposed off during the
year were not substantial. Therefore, the provisions
of clause 4(i)(c) of the Order are not applicable to
the Company.
(ii) (a) The inventories have been physically verified during
the year by the management except for stocks lying at
third party locations for which confirmations have been
obtained and for goods-in-transit. In our opinion, the
frequency of verification is reasonable.
(b)
(c)
The procedures of physical verification of inventories
followed by the management are reasonable and
adequate in relation to the size of the Company and
the nature of its business.
In our opinion and according to the information and
explanations given to us, the Company is maintaining
proper records of inventory. The discrepancies noticed
on verification between the physical stocks and the
book records were not material and have been properly
dealt with in the books of account.
(iii) (a) As informed, the Company has not granted any loans,
secured or unsecured to Companies, firms or other
parties covered in the register maintained under
Section 301 of the Companies Act, 1956. Accordingly,
sub-clause (b), (c) and (d) of clause 4(iii) of the Order
are not applicable.
(iv)
covered in the register maintained under Section 301
of the Companies Act, 1956. Accordingly, sub-clause (f)
and (g) of clause 4(iii) of the Order are not applicable.
In our opinion and according to the information and explanations
given to us, having regard to the explanations that some of the
items purchased are of a special nature and suitable alternatives
do not exist for obtaining comparable quotations, there are
adequate internal control systems commensurate with the size
of the Company and the nature of its business with regard to
purchases of inventory and fixed assets and with regard to the
sale of goods and services. Further, the basis of our examination
and according to the information and explanations given to us,
we have neither come across nor have we been informed of
any instance of major weaknesses in the aforesaid internal
control systems.
(v) (a) In our opinion and according to the information and
explanations given to us, the particulars of contracts or
arrangements referred to in Section 301 of the Companies
Act, 1956 have been entered in the register required to be
maintained under that Section.
(vi)
(b)
In our opinion and according to the information and
explanations given to us, the transactions made in
pursuance of such contracts and arrangements entered
in the register maintained under Section 301 of the
Companies Act, 1956 have been made at the prices
which are reasonable having regard to the prevailing
market prices at the relevant time except in case of some
transactions where alternate source of supply did not exist
and therefore, no comparison of prices was possible.
In our opinion and according to the information and explanations
given to us, the Company has complied with the provisions of
Sections 58A, 58AA or any other relevant provisions of the
Companies Act, 1956 and the Companies (Acceptance of Deposits)
Rules, 1975 with regard to the deposits accepted from the public.
As informed to us, no order has been passed by the Company Law
Board or National Company Law Tribunal or Reserve Bank of India
or any Court or any other Tribunal.
(b)
According to the information and explanations given
to us, the Company has not taken any loans, secured
or unsecured, from companies, firms or other parties
(vii)
In our opinion, the Company has an internal audit system
commensurate with the size of the Company and nature of its
business.

Annexure to the Auditors’ Report
33
(viii)
We have broadly reviewed the books of account maintained by the
Company pursuant to the Rules made by the Central Government
for the maintenance of cost records under Section 209(1)(d) of
the Companies Act, 1956 and are of the opinion that prima facie
the prescribed records have been maintained and the prescribed
accounts are in the process of being made up. We have not,
however, made a detailed examination of the records with a view
to determining whether they are accurate or complete.
(ix) (a) According to the records of the Company, Provident Fund,
Investor Education and Protection Fund, Employees’ State
Insurance, Income-tax, Sales-tax, Wealth tax, Service tax,
Custom duty, Excise duty, Cess and other material statutory
dues applicable to it have been generally regularly
deposited during the year with the appropriate authorities.
According to the information and explanations given to
us, no undisputed amounts payable in respect of above
were in arrears, as at December 31, 2009 for a period
of more than six months from the date on which they
became payable.
(b)
Name of
Statute
(Nature of
Dues)
Sales Tax
(Tax/ Penalty/
Interest)
According to the records of the Company, Income-tax,
Sales-tax, Wealth tax, Service tax, Customs duty, Excise
duty and Cess as applicable which have not been deposited
on account of dispute are as follows:
Period to
which the
amount
Relates
1992-93, 2001-02,
2002-03, 2003-04
Commissionarate
Forum where dispute is pending
Appellate
authorities
& Tribunal
High
Court
(Rs. In Lakhs)
Total
Amount
354.25 – – 354.25
1999-00 – 17.88 – 17.88
1996-97,1997-98,
1998-99
– – 2.27 2.27
Total 354.25 17.88 2.27 374.40
The Central
Excise Act
(Tax/ Penalty/
Interest)
1994-97, 2000-
2001, 2004-2005,
2006- 2007
408.64 – – 408.64
1999-00, 2000-04 –- 33.75 – 33.75
Total 408.64 33.75 – 442.39
Service
Tax
2005-06 0.52 – – 0.52
2004-05 – 5.12 – 5.12
Total 0.52 5.12 – 5.64
Income
Tax (Tax/
Interest)
A.Y. 1987-88,
1992-93 , 1994-95,
2000-01, 2001-02,
2003-04,2004-05,
2005-06 & 2006-07
A.Y. 1995-96,
2000-01, 2003-04
602.23 – – 602.23
– 248.15 – 248.15
Total 602.23 248.15 – 850.38
(x)
The Company does not have any accumulated losses at the end
of the financial year and has not incurred cash losses during
(xi)
(xii)
(xiii)
(xiv)
(xv)
(xvi)
the financial year covered by our audit and in the immediately
preceding financial year.
In our opinion and according to the information and explanations
given to us, the Company has not defaulted in repayment of dues
to financial institution, banks or debenture holders.
Based on our examination of the records and the information and
explanations given to us, the Company has not granted any loans
and advances on the basis of security by way of pledge of shares,
debentures and other securities.
In our opinion, the Company is not a chit fund or a nidhi/ mutual
benefit fund/ society. Therefore, the provisions of clause 4(xiii) of
the Order are not applicable to the Company.
In our opinion, the Company is not dealing in or trading in shares,
securities, debentures and other investments. Accordingly, the
provisions of clause 4(xiv) of the Order are not applicable to
the Company.
In our opinion and according to the information and explanations
given to us, the Company has not given any guarantees for loans
taken by others from banks or financial institutions.
In our opinion and according to the information and explanations
given to us, no term loans were acquired during the reporting
period by the Company.
(xvii) According to the information and explanations given to us and on
an overall examination of the balance sheet of the Company, we
report that no funds raised on short-term basis have been used
for long-term investment.
(xviii) According to the information and explanations given to us, the
Company has not made any preferential allotment of shares to
parties and companies covered in the register maintained under
Section 301 of the Companies Act, 1956.
(xix)
(xx)
(xxi)
The Company has not issued any secured debentures. Therefore
the provisions of clause 4(xix) of the Order are not applicable to
the Company.
The Company has not raised any money by way of public issue
during the year. Therefore, the provisions of clause 4(xx) of the
Order are not applicable to the Company.
According to the information and explanations given to us, no
fraud on or by the Company has been noticed or reported during
the course of our audit.
Mumbai: February 19, 2010
For Deloitte Haskins & Sells
Chartered Accountants
Registration No. 117365W
A. C. Khanna
Partner
Membership No. 17814

34 Clariant Chemicals (India) Limited
Annual Report 2009
Balance Sheet
as at 31st December, 2009
Schedule
31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
SOURCES OF FUNDS
Shareholders’ funds
Share capital 1 2666.07 2666.07
Reserves and surplus 2 32113.18 29097.55
34779.25 31763.62
Loan funds
Unsecured loans 3 204.78 309.07
204.78 309.07
Deferred tax liability – Net (See note 6, Schedule 17) — 254.94
34984.03 32327.63
APPLICATION OF FUNDS
Fixed assets 4
Gross block 34975.65 38797.09
Less : Accumulated depreciation and impairment 21085.35 23390.54
Net block 13890.30 15406.55
Capital work-in-progress and advances, etc. 590.72 1053.83
14481.02 16460.38
Fixed assets held for disposal (See note 26, Schedule 17) 792.34 —
Investments 5 12449.95 5784.47
Deferred tax asset – Net (See note 6, Schedule 17) 275.72 —
Current assets, loans and advances
Inventories 6 7665.03 10543.98
Sundry debtors 7 14459.63 13210.41
Cash and bank balances 8 1696.62 842.31
Loans and advances 9 6320.49 6397.96
30141.77 30994.66
Less : Current liabilities and provisions
Liabilities 10 16572.90 12844.86
Provisions 11 6583.87 8067.02
23156.77 20911.88
Net current assets 6985.00 10082.78
34984.03 32327.63
Notes on balance sheet and profit and loss account 17
Per our report attached
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

35
Profit and Loss Account
for the year ended 31st December, 2009
2009
Rs. Lakhs
2008
Rs. Lakhs
Schedule
INCOME
Sales – Gross 97322.24 100145.34
Less : Excise duty 5188.11 8505.87
Sales – Net 92134.13 91639.47
Other income 12 2630.82 2533.68
94764.95 94173.15
EXPENDITURE
Cost of materials 13 54523.49 58150.05
Personnel cost 14 6158.71 7229.91
Interest (Net) 15 16.67 (18.29)
Depreciation/Amortisation 4 1896.35 2251.60
Impairment of fixed assets 4 136.98 728.62
Other expenditure 16 14178.36 15842.89
76910.56 84184.78
Less : Service charges recovered 906.74 788.23
76003.82 83396.55
PROFIT BEFORE EXCEPTIONAL ITEMS AND TAXATION 18761.13 10776.60
Exceptional items (See note 23, Schedule 17) 2450.46 48.00
PROFIT AFTER EXCEPTIONAL ITEMS AND BEFORE TAXATION 16310.67 10728.60
Provision for taxation
Current tax 5958.00 3792.00
Deferred tax (530.66) (178.29)
Fringe benefit tax 39.00 118.50
(Excess)/Short provision for taxation in respect of earlier years 30.77 248.09
PROFIT AFTER TAXATION 10813.56 6748.30
Balance brought forward from previous year 1097.40 950.36
AVAILABLE FOR APPROPRIATION 11910.96 7698.66
APPROPRIATED AS FOLLOWS
General reserve 1081.36 674.83
Interim dividend 2666.07 —
Proposed dividend (Final) 3999.11 5065.54
Corporate tax on dividend (Interim & Final) 1132.75 860.89
Balance carried to the balance sheet 3031.67 1097.40
11910.96 7698.66
Notes on balance sheet and profit and loss account 17
Basic and Diluted earnings per share (Rupees) (See note 15, Schedule 17) 40.56 25.31
Face value per share (Rupees) 10.00 10.00
Per our report attached to the Balance Sheet
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

36 Clariant Chemicals (India) Limited
Annual Report 2009
Cash Flow Statement
for the year ended 31st December, 2009
A. CASH FLOW FROM OPERATING ACTIVITIES :
2009
Rs. Lakhs
2008
Rs. Lakhs
Net Profit after exceptional items and before taxation 16310.67 10728.60
Adjustments for :
Depreciation/Amortisation 1896.35 2251.60
Impairment of fixed assets 136.98 728.62
Unrealised foreign exchange (gain)/loss (Net) (32.89) 59.96
Interest income (83.20) (171.67)
Dividend income (407.90) (171.56)
Loss/(profit) on sale of assets (Net) (80.31) (20.66)
Loss/(profit) on sale of investments (Net) (0.21) (0.29)
Provision for doubtful debts/advances (Net) 29.39 200.11
Provision for leave encashment (126.69) 4.52
Provision for ex-gratia gratuity (15.21) 4.24
Provision for gratuity (186.30) 267.80
Interest expenses 99.87 153.38
Assets written-off 100.69 390.63
Operating profit before working capital changes 17641.24 14425.28
Adjustments for :
Trade and other receivables (1050.90) 653.07
Inventories 2878.95 727.06
Trade, other payables and provisions 3693.84 (4447.67)
Cash generated from operations 23163.13 11357.74
Direct taxes paid – (Net of refunds) (6055.45) (3288.52)
Net cash from operating activities 17107.68 8069.22
B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of fixed assets (1005.00) (2669.18)
Sale of fixed assets 138.31 49.71
Purchase of investments (95164.44) (42571.83)
Sale of investments 88499.17 39730.92
Loans given to subsidiary (31.00) (75.00)
Loans repaid by subsidiary 1.00 —
Interest received 83.20 171.67
Dividend received 407.90 171.56
Net Cash used in investing activities (7070.86) (5192.15)

Cash Flow Statement
37
C. CASH FLOW FROM FINANCING ACTIVITIES :
2009
Rs. Lakhs
2008
Rs. Lakhs
Repayment of borrowings (104.29) (98.09)
Interest paid (93.33) (147.17)
Dividend/dividend tax paid (8984.89) (3109.75)
Net Cash used in financing activities (9182.51) (3355.01)
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 854.31 (477.94)
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE YEAR 842.31 1320.25
CASH AND CASH EQUIVALENTS AS AT THE END OF THE YEAR (See note 3) (Refer Schedule 8) 1696.62 842.31
Notes:
1. The Cash flow has been prepared under the “Indirect Method” as set out in Accounting Standard – 3 on Cash flow statement notified by the
Companies (Accounting Standards) Rules, 2006.
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.
3. Cash and cash equivalents at the end of the year include current account balances with banks of Rs. 221.71 lakhs (Previous Year : Rs. 161.63 lakhs)
which are restricted in use on account of unclaimed dividend/fixed deposit/interest on fixed deposit.
4. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.
Per our report attached to the Balance Sheet
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

38 Clariant Chemicals (India) Limited
Annual Report 2009
Schedules
forming part of the Balance Sheet
SCHEDULE 1 : SHARE CAPITAL 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Authorised
30000000 equity shares of Rs. 10/- each 3000.00 3000.00
Issued and subscribed
26660745 equity shares of Rs. 10/- each fully paid 2666.07 2666.07
Notes:
Of the above :
(a) 15010745 equity shares issued as fully paid up pursuant to a contract for a consideration other than cash.
(b) 8167080 equity shares are held by EBITO Chemiebeteiligungen AG.
6075000 equity shares are held by Clariant International AG.
2660000 equity shares are held by Clariant Participations AG.
The ultimate holding company being Clariant AG, Switzerland.
(c) 6690610 equity shares were allotted as fully paid up bonus shares by capitalisation of Rs. 669.06 lakhs from general reserve.
SCHEDULE 2 : RESERVES AND SURPLUS 31-12-09
Rs. Lakhs
Capital reserve
31-12-08
Rs. Lakhs
As per last Balance sheet 730.11 730.11
Capital redemption reserve
As per last Balance sheet 137.50 137.50
Securities premium account
As per last Balance sheet 3545.65 3545.65
Investment allowance reserve
As per last Balance sheet 20.00 20.00
Less : Transfer to general reserve 20.00 —
— 20.00
General reserve
As per last Balance sheet 23566.89 22892.06
Add : Transfer from Investment allowance reserve 20.00 —
Transfer from Profit and loss account 1081.36 674.83
24668.25 23566.89
Profit and loss account 3031.67 1097.40
32113.18 29097.55
SCHEDULE 3 : UNSECURED LOANS 31-12-09
Rs. Lakhs
From others:
31-12-08
Rs. Lakhs
Interest-free sales tax deferral scheme granted by State Industries Promotion Corporation
of Tamil Nadu Limited (Repayable within one year Rs. 99.50 lakhs, Previous Year: Rs. 104.29 lakhs) 204.78 309.07
204.78 309.07

Schedules forming part of the Balance Sheet
39
SCHEDULE 4 : FIXED ASSETS
As at
31-12-08
GROSS BLOCK DEPRECIATION / AMORTISATION / IMPAIRMENT NET BLOCK
Additions/
Adjustments
Deductions/
Adjustments
As at
31-12-09
As at
31-12-08
Deductions/
Adjustments
For the
year
Impairment
(See note 2)
As at
31-12-09
As at
31-12-09
Rs. Lakhs
As at
31-12-08
Tangible Assets
Land freehold 145.02 — — 145.02 — — — — — 145.02 145.02
Land leasehold 14.88 — — 14.88 4.50 — 0.16 — 4.66 10.22 10.38
Buildings 6771.07 299.06 4.91 7065.22 2313.36 1.77 171.48 136.98 2620.05 4445.17 4457.71
Plant, machinery, equipment etc. 28909.15 1068.26 5013.19 24964.22 18878.89 4073.89 1550.35 — 16355.35 8608.87 10030.26
Furniture, fixtures and office
appliances 2260.06 88.48 148.71 2199.83 1627.14 140.79 137.20 — 1623.55 576.28 632.92
Vehicles 696.91 12.31 122.74 586.48 566.65 122.07 37.16 — 481.74 104.74 130.26
Total 38797.09 1468.11 5289.55 34975.65 23390.54 4338.52 1896.35 136.98 21085.35 13890.30
Previous year 36413.30 3398.81 1015.02 38797.09 21005.66 595.34 2251.60 728.62 23390.54 15406.55
Capital work-in-progress 550.23 1030.37
Advances against capital orders 40.49 23.46
590.72 1053.83
14481.02 16460.38
Notes:
1. Buildings include Rs. 0.12 lakh (Previous Year : Rs. 0.12 lakh) being the cost of shares and bonds in co-operative housing societies.
2. In accordance with the provisions of the Accounting Standard – 28 on Impairment of Assets notified by the Companies (Accounting Standards) Rules 2006, the Company has identified
certain fixed assets that were impaired mainly on account of economic performance and viability of such assets which does not have any value in use. Accordingly during current year an
impairment loss of Rs. 136.98 lakhs in respect of Dyes and Specialty Chemicals segment (Rs. 12.47 lakhs) and Intermediates and Colours segment (Rs. 124.51 lakhs) has been recognised
in the profit and loss account. (Previous Year Rs. 728.62 lakhs in respect of Intermediates and Colours segment)
SCHEDULE 5 : INVESTMENTS (AT COST) (Contd.) 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Non Trade – Unquoted
Long Term
In Subsidiary Company
500000 (Previous Year: 500000) fully paid equity shares of Rs. 10/- each
in Chemtreat Composites India Private Limited 325.00 325.00
Total Long Term 325.00 325.00
Current
In fully paid units of Rs. 10/- each
9825217 (Previous Year : Nil) Birla Sun Life Saving Fund – Daily Dividend 983.19 —
8883589 (Previous Year : Nil) HDFC Treasury Advantage Fund – Whole Sale Fund – Dividend-Daily 891.16 —
4742864 (Previous Year : Nil) HDFC F R I F – STP – Whole Sale Fund – Dividend-Daily 478.12 —
9776175 (Previous Year : Nil) DWS Ultra Short Term Fund – Dividend-Daily 979.37 —
9019717 (Previous Year : Nil) DWS Cash Opportunity Fund – Dividend-Daily 904.16 —
9695701 (Previous Year : Nil) JM Money Manager Fund – Super Plus Plan – Dividend-Daily 970.08 —
4038543 (Previous Year : Nil) IDFC Money Manager Fund – Dividend-Daily 403.91 —
9471776 (Previous Year : Nil) LIC MF Income Plus Fund – Dividend-Daily 947.18 —
9197118 (Previous Year : Nil) LIC MF Saving Plus Fund – Dividend-Daily 919.71 —
9847865 (Previous Year : Nil) LIC MF Floater Fund – Dividend-Daily 984.80 —

40 Clariant Chemicals (India) Limited
Annual Report 2009
SCHEDULE 5 : INVESTMENTS (AT COST) (Contd.) 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Nil (Previous Year : 9346248) Birla Sun Life Short Term Fund – Institutional – Daily Dividend — 935.14
Nil (Previous Year : 7999333) Fidelity Cash Fund – Institutional – Daily Dividend — 800.13
Nil (Previous Year : 7754587) HDFC Liquid Fund Premium Plan – Dividend-Daily — 950.70
Nil (Previous Year : 5571131) Reliance Medium Term Fund – Daily Dividend — 952.41
In fully paid units of Rs. 100/- each
863340 (Previous Year : Nil) ICICI Prudential Flexible Income Premium Plan Fund – Daily Dividend 912.85 —
957923 (Previous Year : Nil) ICICI Prudential Floating Rate Plan D – Daily Dividiend 958.12 —
In fully paid units of Rs. 1000/- each
91249 (Previous Year : Nil) Reliance Money Manager Fund – Institutional Plan – Daily Dividend 913.53 —
65341 (Previous Year : 89206) DSP BlackRock Floating Rate Fund – Institutional Plan – Daily Dividend 653.77 892.06
22483 (Previous Year : Nil) UTI Floating Rate Fund STP – Daily Dividend 225.00 —
Nil (Previous Year : 83357) TATA Liquid Super High Investment Fund – Daily Dividend — 929.03
Total Current 12124.95 5459.47
Total Investments – Unquoted 12449.95 5784.47
Following are the Investments which have been purchased and sold during the year :
January to December 2009
Nos. Rs. Lakhs
Non trade Current – unquoted
In fully paid units of Rs. 10/- each
Reliance Medium Term Fund DDR 9798769 1675.15
Reliance Liquid Fund Treasury Plan I.P. DDR 23021439 3519.33
Kotak Liquid Fund : Institutional Premium Plan DDR 26435819 3232.60
Kotak Floater Long Term – Daily Dividend 19001414 1915.30
Kotak Flexi Debt Fund – Daily Dividend 9537367 958.27
Birla Sun Life Saving Fund Inst DDR 11422101 1142.99
Birla Sun Life Short Term Fund DDR 166799 16.69
Birla Sun Life Cash Plus Inst DDR 30607458 3066.71
JM High Liquidiy Fund – Super Inst Plan Daily Dividend 32701851 3275.58
JM Money Manager Fund – Super Plus Plan Daily Dividend 24681333 2469.44
TATA Floater Fund – Daily Dividend 22027430 2210.58
DWS Insta Cash Plus Fund – Institutional Plan DDR 30962987 3109.02
DWS Ultra Short Term Fund – Institutional Plan DDR 12471955 1249.16
ICICI Prudential MF Plan Super Institutional Plan Daily Dividend 38359058 3836.40
ICICI Prudential MF Flexible Income Plan – Premium Daily Dividend 17761278 1877.99
ICICI Prudential MF Floating Rate Fund Daily Dividend 9896815 989.89

Schedules forming part of the Balance Sheet
41
Following are the Investments which have been purchased and sold during the year : (Contd.)
January to December 2009
Nos. Rs. Lakhs
HDFC Cash Mangement Fund – Saving Plus – DDR 19417490 2065.32
HDFC Cash Mangement Fund – Treasury Advantage Plan – Wholesale DDR 24687274 2476.50
HDFC F R I F STF – Wholesale DDR 4959875 500.00
HDFC Liquid Fund Premium Plan DDR 31033067 3804.59
Canara Robeco Liquid Fund – I.P. – Daily Dividend 14698674 1475.89
Canara Robeco Treasury Advantage Fund – I.P. – Daily Dividend 3870373 480.20
Fidelity Cash Fund – I.P. – Daily Dividend 10815492 1081.82
Fidelity Ultra Short Term Debt Fund – I.P. – Daily Dividend 19065377 1906.82
IDFC Money Treasury Fund – I.P.C. – Daily Dividend 13954500 1395.66
IDFC Money Treasury Fund – I.P.B. – Daily Dividend 29175520 2938.06
IDFC Cash Fund – Super I.P.C – Daily Dividend 8998490 900.07
IDFC Cash Fund – I.P. – Daily Dividend 37097892 3925.55
SBI – SHF – Ultra Short Term Fund – I.P. – Daily Dividend 17816624 1782.55
SBI – Magnum Insta Cash Fund – Daily Dividend 15543795 2603.63
LIC Liquid Fund – DDR 40459389 4442.48
LIC MF Income Plus Fund – DDR 8641648 864.16
LIC MF Floater Rate S T Fund – DDR 16254850 1625.49
FORTIS Money Plus Inst Plan Fund – DDR 10382401 1038.56
FORTIS Overnight Fund – DDR 10287689 1029.08
In fully paid units of Rs. 100 /- each
ICICI Prudential MF Liquid Plan Super Institutional Plan – Daily Dividend 955874 956.08
In fully paid units of Rs. 1000 /- each
TATA Treasury Manager Fund Ship – Daily Dividend 90536 914.70
TATA Liquidity Management Ship Fund – Daily Dividend 182296 2031.73
DSP BlackRock Floating Rate Fund – I.P. – Daily Dividend 151974 1520.55
DSP BlackRock Cash Manager Fund – I.P. – Daily Dividend 214595 2146.17
UTI Treasury Advantage Fund – I.P. – Daily Dividend 169324 1693.44
UTI Liquid Cash Plan – I.P. – Daily Dividend 234959 2395.29
UTI Floating Rate Fund STP DDR 49961 500.00

42 Clariant Chemicals (India) Limited
Annual Report 2009
SCHEDULE 6 : INVENTORIES 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
At lower of cost and net realisable value (As certified by the Management)
Stores and spare parts 187.66 241.35
Raw materials 2114.96 3281.75
Packing materials 104.13 98.56
Finished goods 4422.91 5718.63
Work-in-progress 835.37 1203.69
7665.03 10543.98
SCHEDULE 7 : SUNDRY DEBTORS 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Secured (Considered good)
Over six months 5.68 9.02
Other debts 1570.88 1349.06
1576.56 1358.08
Unsecured (Considered good, unless otherwise stated)
Over six months (Including doubtful debts Rs. 246.31 lakhs; Previous Year : Rs. 280.89 lakhs) 328.62 396.73
Other debts 12800.76 11736.49
13129.38 12133.22
Less : Provision for doubtful debts 246.31 280.89
14459.63 13210.41
SCHEDULE 8 : CASH AND BANK BALANCES 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Cash on hand 4.18 6.63
Cheques on hand 49.27 82.05
With scheduled banks:
On current accounts 1010.83 582.13
On fixed deposit accounts 632.34 171.50
1643.17 753.63
1696.62 842.31

Schedules forming part of the Balance Sheet
43
SCHEDULE 9 : LOANS AND ADVANCES 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
(Unsecured – Considered good, unless otherwise stated)
Advances and loans to the subsidiary (See note 25, Schedule 17) 688.35 709.47
Advances recoverable in cash or in kind or for value to be received 3517.98 3672.17
Less : Provision for doubtful advances 63.97 —
3454.01 3672.17
VAT set off admissible 99.67 52.51
Advance payment of Income tax (Net of provision for taxation) 1768.95 1648.55
Balances with customs and excise on current account 309.51 315.26
6320.49 6397.96
SCHEDULE 10 : CURRENT LIABILITIES 31-12-09
Rs. Lakhs
Sundry creditors :
31-12-08
Rs. Lakhs
Due to micro enterprises and small enterprises (See Note 7, Schedule 17) 361.14 82.25
Due to others 14127.02 11157.13
14488.16 11239.38
Deposits 1863.03 1443.85
Unpaid dividends* 221.61 160.90
Unclaimed fixed deposits* 0.06 0.15
Unpaid interest on matured fixed deposits* 0.04 0.58
16572.90 12844.86
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund
SCHEDULE 11 : PROVISIONS 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Employee benefits:
Leave encashment 365.02 491.71
Gratuity 200.73 387.03
Ex-gratia gratuity 69.21 84.42
Others:
Provision for taxation (Net of advance payment of Income tax) 1270.15 1177.43
Proposed dividend (Final) 3999.11 5065.54
Corporate tax on proposed dividend (Final) 679.65 860.89
6583.87 8067.02

44 Clariant Chemicals (India) Limited
Annual Report 2009
Schedules
forming part of the Profit and Loss Account
SCHEDULE 12 : OTHER INCOME 2009
Rs. Lakhs
2008
Rs. Lakhs
Dividend on current non-trade investments 407.90 171.56
Export incentives 420.13 482.72
Profit on sale of fixed assets (Net) 80.31 20.66
Cash discounts 39.40 36.15
Rental income 398.25 364.66
Indenting commission 589.29 634.52
Profit on sale of current investments (Net) 0.21 0.29
Miscellaneous 695.33 823.12
2630.82 2533.68
SCHEDULE 13 : COST OF MATERIALS 2009
Rs. Lakhs
2008
Rs. Lakhs
Raw materials consumed 38450.19 42048.52
Packing materials consumed 2275.54 2204.63
Purchases of finished goods 12133.72 13003.39
(Increase)/Decrease in stocks of finished goods and work-in-progress :
Opening stock
Finished goods 5718.63 6625.64
Work-in-progress 1203.69 1190.19
6922.32 7815.83
Less : Closing stock
Finished goods 4422.91 5718.63
Work-in-progress 835.37 1203.69
5258.28 6922.32
1664.04 893.51
54523.49 58150.05
SCHEDULE 14 : PERSONNEL COST 2009
Rs. Lakhs
2008
Rs. Lakhs
Salaries, wages, bonus, etc. 4677.67 5256.71
Contribution/Provision for provident fund, superannuation scheme, gratuity fund, etc. 551.95 1028.20
Welfare expenses 929.09 945.00
6158.71 7229.91

Schedules forming part of the Profit & Loss Account
45
SCHEDULE 15 : INTEREST (NET) 2009
Rs. Lakhs
2008
Rs. Lakhs
Interest Paid
Others 99.87 153.38
99.87 153.38
Less : Interest received (Gross) :
Others (Tax deducted at source Rs. 12.69 Lakhs; Previous Year : Rs. 7.71 Lakhs) 83.20 171.67
83.20 171.67
16.67 (18.29)
SCHEDULE 16 : OTHER EXPENDITURE 2009
Rs. Lakhs
2008
Rs. Lakhs
Stores and spare parts etc. consumed 605.63 597.94
Repairs and maintenance:
Plant and machinery 707.88 886.37
Buildings 218.64 216.51
Others 153.33 176.59
Power and fuel 4574.37 4464.92
Rent (including lease payments) (See note 16, Schedule 17) 555.90 582.10
Rates and taxes (including water charges) 516.03 658.00
Insurance 69.27 109.83
Clearing, forwarding and transport 1309.07 1490.65
Travelling and conveyance 873.15 962.82
Commission 175.82 250.64
Cash discount 11.76 22.37
Other discounts on sales 684.65 1324.79
Assets written-off 100.69 390.63
Provision for doubtful debts/advances (Net) 29.39 200.11
Excise duty (324.39) (376.11)
Exchange loss (Net) 162.28 172.63
Miscellaneous (See note 18, Schedule 17) 3754.89 3712.10
14178.36 15842.89

46 Clariant Chemicals (India) Limited
Annual Report 2009
Notes
SCHEDULE 17 : Notes on the Balance Sheet and Profit and Loss Account for the year ended 31st December, 2009
1. Significant Accounting Policies
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting
notified by the Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of the Companies Act, 1956.
The significant accounting policies are as follows :
I. Revenue Recognition
II.
III.
IV.
The Company recognises sale of goods on transfer of significant risks and rewards of ownership of the goods to the buyer. Sales are
net of excise duty, sales tax and trade discounts, wherever applicable.
Dividend income on investments is accounted for when the right to receive the payment is established.
Excise Duty
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at
the year end.
Excise Duty related to the difference between the closing stock and opening stock of finished goods has been recognised separately in
the profit and loss account under schedule of ‘Other Expenditure’.
Research and Development
Revenue expenditure on research and development is written off in the profit and loss account in the year in which it is incurred. Capital
expenditure on research and development is treated in the same way as expenditure on fixed assets.
Employee Benefits
(a)
Short term employee benefit obligations are estimated and provided for.
(b) Post employment benefits and other long term employee benefits :
Defined contribution plans :
Company’s contribution to provident fund, superannuation fund, employee state insurance and other funds are determined under
the relevant schemes and/or statute and charged to revenue.
Defined benefit plans and compensated absences :
Company’s liability towards gratuity, ex-gratia gratuity and compensated absences are actuarially determined at each balance
sheet date using the projected unit credit method. Actuarial gains and losses are recognised in revenue.
V. Voluntary Retirement Scheme
VI.
Expenditure incurred on voluntary retirement scheme is charged to revenue in the year in which it is incurred.
Fixed Assets and Depreciation/Amortisation
(a)
(b)
(c)
(d)
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other
attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed
for acquisition of qualifying assets for the year upto the date the assets are put to use is included in cost.
The cost of leasehold land is amortised over the period of the lease.
Intangible assets are being amortised equally over a period of three years.
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the
Companies Act, 1956 except for :
(i) certain items of furniture, fixture, air conditioners, plant, machinery and equipment on which a depreciation rate of 20%
on straight line method is applied,

Notes
47
VII.
VIII.
IX.
(e)
(ii)
(iii)
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP
equipments including personal computers and printers on which depreciation rate of 25% on straight line method is applied,
Motor Cars on which depreciation rate of 25% on straight line method is applied.
Fixed Assets held for disposal are stated at lower of net book value and net realisable value.
Impairment of Assets
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever the carrying amount of an asset exceeds its estimated recoverable
amount. The recoverable amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated
future cash flows are discounted to the present value using the weighted average cost of capital. Previously recognised impairment loss
is further provided or reversed depending on changes in circumstances.
Inventories
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories
is generally arrived at on the following basis :
Raw materials, packing materials, trading items and stores and spares – Weighted average cost
Finished goods and work-in-progress – Absorption costing at works cost
Sundry Debtors/Loans and Advances
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.
X. Investments
XI.
XII.
XIII.
XIV.
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated
at the lower of cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.
Leases
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as
operating leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over
the lease term.
Foreign Currency Translations
(a)
(b)
(c)
Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting
year. In respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward
exchange contract is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation
of such a forward exchange contract is recognised as income or expense for the period. Foreign currency transactions are
accounted at the rate prevailing on the date of transaction.
Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the
exchange rate at the date of transaction.
Income Tax
Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account.
Income-tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax
payable in respect of the estimated taxable income for the year. The deferred tax charge or credit is recognised using prevailing
enacted or substantively enacted tax rates. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are
recognised only if there is virtual certainty of realisation of such assets. Other deferred tax assets are recognised only to the extent
there is reasonable certainty of realisation in future. Deferred tax assets/liabilities are reviewed at each Balance Sheet date based on
developments during the year and available case laws, to reassess realisation/liabilities.
Contingencies/Provisions
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources
embodying economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions
except in respect of employee benefits are not discounted to its present value and are determined based on best estimate of the
expenditure required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted
to reflect the current best estimate. A contingent liability is disclosed, unless the possibility of an outflow of resources embodying the
economic benefit is remote.

48 Clariant Chemicals (India) Limited
Annual Report 2009
2. Segment Information for the year ended 31st December, 2009 (As required by Accounting Standard (AS) – 17 Segment Reporting) :
(a) The Company is organised into two primary business segments mainly :
(i)
(ii)
Intermediates and Colours : Includes pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and
pharmaceuticals and masterbatches for plastics and nylon fibers.
Dyes and Specialty Chemicals : Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals.
(b) The secondary segments of the Company are geographical segments mainly :
(i)
(ii)
India
Outside India
(c)
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the
organisation structure, and the internal financial reporting system.
(d) (i) Segment Revenue and Results :
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.
(ii) Segment assets and liabilities :
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and
inventories. Segment liabilities primarily include creditors and other liabilities.
(iii)
Assets and liabilities that cannot be allocated among the segments are shown as a part of unallocable corporate assets and
liabilities respectively.
Information about Primary Business Segments : (Contd.)
Intermediates
& Colours*
2009
Rs. Lakhs
Dyes and
Specialty
Chemicals
Total
Intermediates
& Colours*
2008
Rs. Lakhs
Dyes and
Specialty
Chemicals
Revenue (Net)
External Sales/Revenue 39266.95 52867.18 92134.13 40169.07 51470.40 91639.47
Results
Segment Results 8477.04 10694.37 19171.41 4704.42 7026.57 11730.99
Unallocated Corporate Expenses (Net) (801.51) (1144.24)
Operating Profits 18369.90 10586.75
Interest Income/Dividend income 491.10 343.23
Interest Expenses (99.87) (153.38)
Profit Before Exceptional Items and Taxation 18761.13 10776.60
Exceptional Items (See note 23, Schedule 17) (2450.46) (48.00)
Profit Before Taxation After Exceptional Items 16310.67 10728.60
Current Tax/Deferred Tax (5427.34) (3613.71)
Fringe benefit Tax (39.00) (118.50)
Short provision for taxation in respect of earlier years (30.77) (248.09)
Profit After Tax 10813.56 6748.30
Other Information
Segment Assets 19429.34 19802.95 39232.29 20989.52 21564.60 42554.12
Unallocated Corporate Assets 16863.84 9036.84
Total Assets 56096.13 51590.96
Segment Liabilities 6597.21 8997.45 15594.66 4585.83 8026.18 12612.01
Unallocated Corporate Liabilities 1817.98 1505.08
Total Liabilities 17412.64 14117.09
Total

Notes
49
Information about Primary Business Segments : (Contd.)
Intermediates
& Colours*
2009
Rs. Lakhs
Dyes and
Specialty
Chemicals
Total
Intermediates
& Colours*
2008
Rs. Lakhs
Dyes and
Specialty
Chemicals
Capital Expenditure 668.46 322.11 990.57 1413.84 1220.14 2633.98
Unallocated Corporate Capital Expenditure 14.43 35.20
Total Capital Expenditure 1005.00 2669.18
Depreciation/Amortisation 1008.70 818.63 1827.33 1132.43 1032.82 2165.25
Impairment of Fixed Assets 124.51 12.47 136.98 728.62 — 728.62
Unallocated Corporate Depreciation 69.02 86.35
Total Depreciation/Amortisation/Impairment 2033.33 2980.22
Non Cash Expenses other than
Depreciation/Amortisation/Impairment 61.72 63.93 125.65 541.04 296.07 837.11
Unallocated Corporate Non Cash Expenses other
than Depreciation/Amortisation/Impairment 64.28 33.20
Total Non Cash Expenses other than
Depreciation/Amortisation/Impairment 189.93 870.31
Information about Secondary Segments :
India
2009
Rs. Lakhs
Outside
India
2008
Rs. Lakhs
Total India Outside
India
External Sales 75032.64 17101.49 92134.13 72991.30 18648.17 91639.47
Segment Assets 35612.25 3620.04 39232.29 39578.46 2975.66 42554.12
Additions to Fixed Assets 990.57 — 990.57 2633.98 — 2633.98
Notes :
1. Total Assets exclude the following :
(a) Advance payment of Income Tax Rs. 1768.95 lakhs (Rs. 1648.55 lakhs)
(b) Deferred Tax Assets (Net) Rs. 275.72 lakhs (Rs. Nil)
2. Total Liabilities exclude the following :
(a) Proposed Dividend Rs. 3999.11 lakhs (Rs. 5065.54 lakhs)
(b) Corporate Tax on proposed dividend Rs. 679.65 lakhs (Rs. 860.89 lakhs)
(c) Provision for Taxation Rs. 1270.15 lakhs (Rs. 1177.43 lakhs)
(d) Deferred Tax Liability (Net) Rs. Nil (Rs. 254.94 lakhs)
* Products hitherto reported under “Masterbatches” segment is now reported under “Intermediates & Colours” segment since the products are
similar in nature.
Total
Total
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures” are given below :
Relationship :
(a) Holding Company :
EBITO Chemiebeteiligungen AG, Clariant International AG and Clariant Participations AG, together hold 63.40% equity shares in the
Company, the ultimate holding company being Clariant AG, Switzerland.
(b) Subsidiary of the Company :
The Company has subsidiary Chemtreat Composites India Pvt. Ltd. – 100% shareholding.

50 Clariant Chemicals (India) Limited
Annual Report 2009
(c) Other related parties in the Clariant group where common control exists and with whom the company has transactions :
Fellow Subsidiary Companies :
Clariant (Argentina) SA
Clariant Masterbatches (Italia) S.p.A.
Clariant (Australia) Pty. Ltd.
Clariant Masterbatches (Shanghai) Ltd.
Clariant (Canada) Inc.
Clariant Masterbatches (Thailand) Ltd.
Clariant (China) Ltd.
Clariant Masterbatches Benelux SA
Clariant (Colombia) SA
Clariant Masterbatches Huningue
Clariant (Egypt) SAE
Clariant Masterbatches Ireland Limited
Clariant (Gulf) FZE
Clariant Masterbatches Norden AB
Clariant (Japan) K.K.
Clariant Masterbatches UK Ltd.
Clariant (Korea) Ltd.
Clariant Oil Services UK Ltd.
Clariant (Malaysia) Sdn Bhd
Clariant Pigments (Korea) Ltd.
Clariant (Maroc) S.A.
Clariant Pigments (Tianjin) Ltd.
Clariant (Mexico) S.A. de C.V.
Clariant Prodotti (Italia) S.p.A.
Clariant (Pakistan) Ltd.
Clariant Production (France)
Clariant (Singapore) Pte. Ltd.
Clariant Production UK Ltd.
Clariant (Thailand) Ltd.
Clariant Produkte (Deutschland) GmbH
Clariant (Tianjin) Ltd.
Clariant Produkte (Schweiz) AG
Clariant (Uruguay) SA
Clariant S.A.
Clariant Chemicals (China) Ltd.
Clariant Southern Africa (Pty.) Ltd.
Clariant Chemicals (Taiwan) Co., Ltd.
Clariant Specialty Chemicals (Zhenjiang) Co., Ltd.
Clariant Colorquímica (Chile) Ltd.
Clariant Specialty Fine Chemicals (France)
Clariant Corporation
Clariant Trading (China) Ltd.
Clariant Distribution UK Ltd.
Clariant Venezuela, S.A.
Clariant Distribuzione (Italia) S.p.A.
Dick Peters B.V.
Clariant Export AG
K.J. Quinn
Clariant Ibérica Producción S.A.
PT Clariant Indonesia
Clariant Masterbatch Ibérica S.A.
Clariant (Türkiye) Boya ve Kimyevi Maddeler Sanayi ve Ticaret A.S.
Clariant Masterbatches (Deutschland) GmbH
(d) Key Management Personnel :
H. Meier : Vice-Chairman & Managing Director (upto 31.12.2009)
During the year following transactions were entered into with related parties : (Contd.)
(i) Holding Company, Subsidiary Company and Fellow Subsidiaries : (Contd.)
2009
Rs. Lakhs
2008
Rs. Lakhs
Holding Company :
Transactions during the year :
Clariant International AG
Sale of goods 1501.15 1742.65
Purchase of goods 9234.75 7673.84
Services rendered 377.62 324.08
Services received 699.34 644.13
Dividend paid 1761.75 607.50
Expenses recovered 1.51 19.46
EBITO Chemiebeteiligungen AG
Dividend Paid 2368.46 816.71
Clariant Participations AG
Dividend Paid 771.40 266.00
Balances outstanding as at the year end :
Amount payable 1142.51 984.03
Amount receivable 449.12 676.53
Subsidiary Company :
Transactions during the year :
Chemtreat Composites India Pvt. Ltd.
Sale of goods — 0.41
Sale of capital goods — 16.87
Purchase of goods — 0.20
Services rendered 115.94 115.00
Loan given during the year 31.00 75.00
Loan repaid during the year 1.00 —
Amount receivable 688.35 709.47

Notes
51
During the year following transactions were entered into with related parties : (Contd.)
(i) Holding Company, Subsidiary Company and Fellow Subsidiaries : (Contd.)
2009
Rs. Lakhs
2008
Rs. Lakhs
Fellow Subsidiaries :
Transactions during the year :
Sale of goods
Clariant Produkte (Deutschland) GmbH 1419.66 2338.86
Clariant Corporation 1157.42 2158.91
Clariant (China) Ltd. 2895.33 1524.41
PT Clariant Indonesia 1170.42 811.89
Others 4369.00 3944.64
Purchase of goods
Clariant (Tianjin) Ltd. 51.95 170.67
Clariant (China) Ltd. 771.38 1008.24
Clariant Corporation 44.82 127.58
Others 474.29 211.87
Purchase of capital goods
Clariant Masterbatches (Deutschland) GmbH 5.27 170.08
Clariant Masterbatches (Italia) S.p.A. 10.00 23.34
Clariant Production UK Ltd. 2.97 —
Sale of capital goods
Clariant Produkte (Deutschland) GmbH 50.47 —
Services rendered and others
Clariant Export AG 308.38 283.67
Clariant Produkte (Deutschland) GmbH 0.54 70.55
Others 40.52 44.70
Expenses recovered
Clariant Produkte (Deutschland) GmbH — 4.49
PT Clariant Indonesia 0.22 —
Clariant (Singapore) Pte. Ltd. 0.05 —
Others — 0.78
Services received and others
PT Clariant Indonesia 18.49 8.19
Clariant (Singapore) Pte. Ltd. 20.67 29.65
Clariant Southern Africa (Pty.) Ltd. 27.35 8.86
Clariant Produkte (Deutschland) GmbH — 8.93
Clariant S.A. — 10.51
Clariant (Gulf) FZE 11.37 2.77
Others 16.55 17.83
Expenses reimbursed
PT Clariant Indonesia 0.76 —
Clariant (Malaysia) Sdn Bhd 1.63 —
Balances outstanding as at the year end :
Amount payable 424.20 520.37
Amount receivable 2453.27 1441.32
(ii) Key Management Personnel :
Remuneration 217.09 164.97
Payable balance 67.58 26.75

52 Clariant Chemicals (India) Limited
Annual Report 2009
4. Contingent liabilities not provided for :
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
I. (a) in respect of income tax matters
decided against the Company, in respect of which the Company is in further appeal 1458.40 856.16
decided in favour of the Company against which the department is in appeal 14.78 14.78
(b) in respect of sales tax matters 578.58 494.22
(c) in respect of excise matters 448.03 455.66
(d) in respect of bills of exchange discounted with banks
1119.58 29.60
[since realised Rs. 778.63 lakhs (Rs. 17.73 lakhs)]
(e) Other matters in dispute 2.25 2.25
(f) Disputed Labour matters – Amount not ascertained
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is determinable only on receipt of judgements
pending at various forums/authorities.
II. On 15th February 2005, the Company had received an order of the Tahsildar, Thane demanding Rs. 120.70 lakhs for the lease of land to
Thane Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against
which the Company had filed a writ petition on 23rd February 2005 before the Bombay High Court. The Hon’ble High Court has granted
interim stay in terms of the petition on 14th July 2005.
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
5. Estimated amount of contracts remaining to be executed on capital account and not
provided for 134.25 148.31
6. Deferred Taxes :
The major components of deferred tax assets and deferred tax liabilities are set out below :
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
Deferred Tax Assets
(a) Provision for doubtful debts 105.50 95.50
(b) Provision for retirement benefits 215.89 327.47
(c) Expenses allowable for tax purposes when paid 53.54 53.54
(d) Integration expenses 15.74 78.70
(e) Payment/Provision for Voluntary retirement scheme 1184.64 552.46
(f) Others — 1.23
1575.31 1108.90
Deferred Tax Liabilities
Depreciation/Amortisation/Impairment (1299.59) (1363.84)
Deferred Tax Assets/(Liabilities) – Net 275.72 (254.94)
7. Disclosure required under the Micro, Small and Medium Enterprises Development
Act, 2006 (the Act) are given as follows :
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
(a) Principal amount due 361.14 82.25
Interest due on the above — —
(b) Interest paid during the year beyond the appointed day — —
(c) Amount of interest due and payable for the period of delay in making payment without
adding the interest specified under the Act — —
(d) Amount of interest accrued and remaining unpaid at the end of the year — —
(e) Amount of further interest remaining due and payable even in the succeeding years,
untill such date when the interest dues as above are actually paid to the small
enterprise for the purpose of disallowance as a deductible expenditure under
Section 23 of the Act — —
The above information and that given in Schedule-10 ‘Current Liabilities’ regarding micro
enterprises and small enterprises has been determined on the basis of information available
with the Company. This has been relied upon by the auditors. No Interest has been accrued
for delayed payments, if any.

Notes
53
8. Disclosure in respect of Derivative Instruments :
The Company uses Forward Exchange Contracts to hedge its exposure in foreign currency. The information on derivative instruments is as follows :
(a)
(b)
Amount in
foreign currency
31-12-2009 31-12-2008
Amount Amount in
Rs. Lakhs foreign currency
Amount
Rs. Lakhs
Forward Exchange Contracts outstanding as at
Currency
USD/INR (Sale) 750000 350.53 500000 251.03
EUR/INR (Purchase) 200000 135.60 — —
Foreign currency exposures not covered by a derivative
instrument
(i) Amount receivable on account of export of goods and services :
Currency
USD 7195779 3354.49 5653335 2743.73
EUR 207550 139.49 124555 85.12
CHF 278569 126.06 320046 146.81
3620.04 2975.66
(ii) Amount payable on account of import of goods and services :
Currency
USD 1813887 843.96 2366286 1144.07
EUR 1598195 1074.12 1618387 1106.89
CHF 352103 159.33 337817 154.96
GBP — — 14742 10.38
2077.41 2416.30
9. (a) Amount paid/payable by the Company to Directors (including Managing Director) as remuneration for services rendered
in any capacity :
2009
Rs. Lakhs
2008
Rs. Lakhs
Directors’ sitting fees 1.45 0.90
Salaries 137.76 136.17
Commission 36.75 34.75*
Compensation for loss of office 40.83 —
Provident fund 11.35 1.89
Other perquisites and benefits in cash or in kind 0.40 0.16
228.54 173.87
* Actual paid during the year Rs. 25.49 lakhs and Rs. 9.26 lakhs reversed during the year.
(b) Computation of net profit for commission payable to the Directors in accordance with Section 198 of the Companies
Act, 1956 :
2009
Rs. Lakhs
2008
Rs. Lakhs
Profit after tax as per profit and loss account 10813.56 6748.30
Add : Provision for taxation-Net 5497.11 3980.30
Managerial remuneration 228.54 173.87
Wealth tax 2.50 5.00
Voluntary retirement scheme compensation 2810.46 48.00
Impairment of fixed assets 136.98 728.62
Provision for doubtful debts/advances (net) 29.39 200.11
8704.98 5135.90
19518.54 11884.20
Less : Profit on sale of investments 0.21 0.29
Income from sale of flexible laminating adhesives business 360.00 —
Capital Profit on sale of fixed assets 48.88 9.93
409.09 10.22
Net profit as per Section 198 19109.45 11873.98
Commission :
To Vice-Chairman & Managing Director
Restricted to sum as determined by the Board of Directors. 26.75 26.75*
To Directors who are not in whole-time employment of the Company @ 1% of net profit
i.e. Rs. 191.09 lakhs (Rs. 118.74 lakhs)
Restricted to sum as determined by the Board of Directors. 10.00 8.00
36.75 34.75
* Actual paid during the year Rs. 17.49 lakhs

54 Clariant Chemicals (India) Limited
Annual Report 2009
10. Capacities and production :
2009 2008
Class of goods
Annual
Installed
Annual
Installed
Capacity Production
Capacity Production
M. Tonnes # M. Tonnes * # M. Tonnes # M. Tonnes * #
(a) Intermediates and Colours 28027 15690 29455 20934
(b) Dyes and Specialty Chemicals 66660 50201 63070 42979
* Excluding captive consumption
# At different concentrations
Notes :
1. The classification between the class of goods and the installed capacities have been certified by the Vice-Chairman & Managing
Director on which the auditors have placed reliance, this being a technical matter.
2. Licensed capacity per annum not indicated due to the abolition of Industrial Licenses as per Notification No. 477(E) dated 25th July, 1991
issued under The Industries (Development and Regulations) Act, 1951.
11. Purchase of finished goods :
2009 2008
Class of goods Quantity Value Quantity Value
M. Tonnes * Rs. Lakhs M. Tonnes * Rs. Lakhs
Trading Items :
Dyes, Chemicals, Pigments, Masterbatches, etc. 7241 12133.72 7528 13003.39
* Includes 532 M. Tonnes (797 M. Tonnes) used for captive consumption.
12. Raw materials consumed :
2009 2008
Quantity Value Quantity Value
M. Tonnes Rs. Lakhs M. Tonnes Rs. Lakhs
(a) Acetic acid glacial 9777 2741.79 9831 3139.24
(b) Others (None of the items individually
35708.40 38909.28
exceed 10% of the total value of raw
materials consumed)
38450.19 42048.52
Note : Raw materials consumed have been arrived at after write down of certain items and excess/shortage on physical verification.
13. Consumption of raw materials :
2009 2008
% of total Value % of total Value
Consumption Rs. Lakhs Consumption Rs. Lakhs
(a) Raw materials :
Imported 33.70 12956.32 31.79 13365.31
Indigenous 66.30 25493.87 68.21 28683.21
100.00 38450.19 100.00 42048.52
(b) Components and spare parts referred to in Paragraph 4D (c) of Schedule VI of the Companies Act, 1956 are assumed to be incorporated
in the goods produced and not those used for maintenance of plant and machinery.
14. Sales, Opening and Closing Stock :
Class of goods Opening Stock Closing Stock Sales (inclusive of
excise duty)
Quantity
M. Tonnes
Value
Rs. Lakhs
Quantity
M. Tonnes
Value
Rs. Lakhs
Quantity
M. Tonnes
Value
Rs. Lakhs
(a) Intermediates and Colours 777 2774.40 564 1651.62 15903 39838.43
(770) (2382.95) (777) (2774.40) (20927) (43478.44)
(b) Dyes and Specialty Chemicals 1617 1458.51 1860 1265.37 49958 42855.95
(2903) (2327.94) (1617) (1458.51) (44265) (40773.80)
(c) Trading items (including dyes, chemicals,
pigments, masterbatches, etc.) 828 1485.72 889 1505.92 6648 14627.86
(1171) (1914.75) (828) (1485.72) (7074) (15893.10)
5718.63 4422.91 97322.24
(6625.64) (5718.63) (100145.34)

Notes
55
2009
Rs. Lakhs
2008
Rs. Lakhs
15. Earnings per share :
(a) Net profit after taxation 10813.56 6748.30
(b) Number of equity shares outstanding 26660745 26660745
(c) Basic and Diluted earnings per share (Rupees) 40.56 25.31
(d) Face value per share (Rupees) 10.00 10.00
16. Assets taken on lease on or after 1st April, 2001 :
(a) In respect of operating leases, where lease agreements have been formally entered into,
lease payments recognised in the profit and loss account for the year are as follows.
Office premises, vehicles and computers 382.43 377.91
(b) There are no restrictions such as those concerning dividends, additional debt and further
leasing, imposed by the lease agreements entered into by the Company.
(c) Contingent rent payments in respect of vehicles are dependent upon the excess of
actual usage, if any, over stipulated usage.
(d) The total of future minimum lease payments under non-cancellable operating leases are
as follows :
For a period not later than one year 285.05 326.65
For a period later than one year and not later than five years 254.37 343.68
Total 539.42 670.33
17. Expenditure on Research and Development :
(a) Capital expenditure 3.36 9.93
(b) Revenue expenditure charged to profit and loss account 224.20 323.29
227.56 333.22
18. Miscellaneous Expenses in Schedule 16 : Other expenditure include :
Auditors’ remuneration and expenses : (Excluding Service tax)
(a) Audit fees 22.00 22.00
(b) Company law matters 0.15 —
(c) Taxation services 0.23 —
(d) Other services 28.20 32.25
(e) Out-of-pocket expenses 0.45 0.11
51.03 54.36
19. Value of imports (C.I.F.) :
(a) Raw materials and trading items 16908.62 19144.01
(b) Components and spare parts 10.87 11.28
(c) Capital goods 104.49 394.19
20. Expenditure in foreign currency (subject to deduction of tax where applicable) :
(a) Commission 177.65 142.98
(b) Interest 6.58 57.22
(c) Others (includes exchange loss) 1579.68 1483.83
21. Remittance in foreign currency on account of dividend :
Number of non-resident shareholders where direct remittances have been made by the Company 3 3
Number of shares on which dividend is remitted 16902080 16902080
Year to which dividend relates
2009 (Interim) 1690.21 —
2008 (Final) 3211.40 —
2007 (Final) — 1690.21
22. Earnings in foreign exchange :
(a) Exports (F.O.B.) 16612.73 18185.95
(b) Know-how 132.71 155.09
(c) Sale of capital goods 50.47 —
(d) Others (insurance, freight, commission, claims, exchange gain etc.) 1268.50 1392.98
23. Exceptional items in Profit & Loss Account include :
Termination benefits to Employees 2810.46 48.00
Income from sale of flexible laminating adhesives business (360.00) —
2450.46 48.00

56 Clariant Chemicals (India) Limited
Annual Report 2009
24. Employee Benefits :
2009
Rs. Lakhs
2008
Rs. Lakhs
Funded Unfunded Funded Unfunded
(a) Defined benefit Plans - As per Actuarial valuation as on December 31, 2009 :
Gratuity
(i) Expenses recognised in the statement of Profit and Loss Account for the year
1. Current service cost 181.10 4.17 190.63 4.36
2. Interest cost 178.36 6.86 142.81 6.01
3. Expected return on plan assets (204.25) — (194.58) —
4. Net actuarial (gain)/loss recognised during the year (133.86) 4.54 234.40 (5.81)
5. Expense/(Income) recognised in profit & loss account 21.35 15.57 373.26 4.56
[Gratuity expense/(income) have been recognised in Contribution/
Provision for provident fund, superannuation scheme, gratuity fund
etc. in “Personnel Cost” under Schedule 14]
(ii) Actual return on plan assets for the year
1. Expected return on plan assets 204.25 — 194.58 —
2. Actuarial gain/(loss) on plan assets (38.87) — 39.51 —
3. Actual return on plan assets 165.38 — 234.09 —
(iii) Net Asset/(Liability) recognised in the Balance Sheet as at the year end
1. Present value of the defined benefit obligation 2342.20 69.21 2940.12 84.42
2. Fair value of plan assets 2141.47 — 2553.09 —
3. Net Asset/(Liability) recognised in the balance sheet (200.73) (69.21) (387.03) (84.42)
(iv) Change in defined benefit obligation during the year
1. Present value of obligation at the beginning of the year 2940.12 84.42 2551.45 80.18
2. Current service cost 181.10 4.17 190.63 4.36
3. Interest cost 178.36 6.86 142.81 6.01
4. Benefits paid (784.65) (30.78) (218.68) (0.32)
5. Actuarial (gain)/loss on obligation (172.73) 4.54 273.91 (5.81)
6. Present value of obligation as at the end of the year 2342.20 69.21 2940.12 84.42
(v) Changes in fair value of plan asset during the year
1. Fair value of plan assets as at the beginning of the year 2553.09 — 2432.22 —
2. Expected return on plan assets 204.25 — 194.58 —
3. Contributions made 207.65 — 105.46 —
4. Benefits paid (784.65) — (218.68) —
5. Actuarial gain/(loss) on plan assets (38.87) — 39.51 —
6. Fair value of plan assets as at the end of the year 2141.47 — 2553.09 —
(vi) Major categories of Plan Assets as a percentage of total plan assets
1. Central government securities 29.64% — 24.84% —
2. State government securities 12.32% — 10.03% —
3. Private sector bonds 20.90% — 15.21% —
4. Special deposit scheme 25.54% — 21.69% —
5. Cash at bank 1.15% — 1.10% —
6. Investment in insurance companies 22.06% — 22.67% —
7. Others (11.61%) — 4.46% —
(vii) Actuarial assumptions
1. Discount rate 8.0% 8.0% 7.0% 7.0%
2. Expected Rate of return on plan assets 8.0% — 8.0% —
3. Salary escalation 4.0%-6.0% 4.0%-6.0% 4.0%-6.0% 4.0%-6.0%
(viii) Experience adjustments
1. Experience adjustments on plan assets (38.87) — — —
2. Experience adjustments on plan liabilities (49.77) 4.54 — —

Notes
57
24. Employee Benefits : (Contd.)
(a)
Defined benefit Plans - As per Actuarial valuation as on December 31, 2009 : (Contd.)
2009
Rs. Lakhs
2008
Rs. Lakhs
Other long term benefits
The defined benefit obligations which are provided for but not funded are as under :
Compensated Absence/Leave Salary 365.02 491.71
(b) Gratuity is administered through duly constituted and approved independent trusts and
also through Group gratuity scheme with Life Insurance Corporation of India
(c) Future salary increases considered in acturial valuation take in to account inflation,
seniority, promotion and other relevant factors, such as supply and demand in the
employment market
(d) Basis used to determine expected rate of return on plan assets :
The expected rate of return on plan assets is based on market expectation, at the
beginning of the year, for returns over the entire life of the related obligation.
(e) Accounting standard 15 (Revised 2005) "Employee Benefits" requires the disclosure of
experience adjustments for past four years, however, the information is given only for the
current year.
(f) During the year the Company has recognised the following amounts in the Profit & Loss
account in Schedule 14 :
Salaries, wages, bonus includes compensated absences 49.17 93.02
Contribution/Provision for provident fund, superannuation scheme, gratuity fund etc. includes :
Provident Fund & Family Pension 275.30 278.81
Superannuation Fund 239.24 370.57
Gratuity Fund 36.92 377.82
Other funds 0.49 1.00
25. Advances and loans to the subsidiary of Rs. 688.35 lakhs (Rs. 709.47 lakhs) is due from Chemtreat Composites India Private Ltd. Maximum
amount due during the year Rs. 750.22 lakhs (Rs. 786.22 lakhs). This amount is interest free and repayable on demand.
26. The Company has entered into an agreement with Laxmi Organic Industries Ltd. on May 15, 2009 for the sale of its business of Diketene and
downstream intermediate products together with removable plant and equipment. On receipt of full consideration, the transaction has been
concluded in January 2010.
27. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.
28. The figures in brackets are those in respect of the previous accounting year.
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

58 Clariant Chemicals (India) Limited
Annual Report 2009
Statement pursuant to Part IV of Schedule VI to The Companies Act, 1956
Balance Sheet Abstract and Company’s General Business Profile
I. Registration Details
II.
III.
IV.
Registration No. 1 1 – 1 0 8 0 6 State Code 1 1
Balance Sheet Date 3 1 – 1 2 – 2 0 0 9
Date Month Year
Capital raised during the year (Amount in Rs. Thousands)
Public Issue N I L Right Issue N I L
Bonus Issue N I L Private Placement N I L
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)
Total Liabilities* 5 8 1 4 0 8 0 Total Assets 5 8 1 4 0 8 0
Sources of Funds
Paid-up Capital 2 6 6 6 0 7 Reserves and Surplus 3 2 1 1 3 1 8
Secured Loans N I L Unsecured Loans 2 0 4 7 8
Application of Funds
Net Fixed Assets 1 5 2 7 3 3 6 Investments 1 2 4 4 9 9 5
Net Current Assets** 7 2 6 0 7 2 Miscellaneous Expenditure N I L
Accumulated Losses N I L
*Including Shareholder’s funds ** Includes Deferred tax Assets (net) Rs. 27572
Performance of Company (Amount in Rs. Thousands)
Turnover (Gross Revenue) @ 9 4 7 6 4 9 5 Total Expenditure 7 8 4 5 4 2 8
@ Includes Other Income Rs. 263082
+ – Profit Before Tax + – Profit After Tax
P 1 6 3 1 0 6 7 P 1 0 8 1 3 5 6
Earnings Per Share in Rs.** 4 0 . 5 6 Dividend Rate % 2 5 0
** Earnings per share has been computed by dividing profit after tax by the total number of issued equity shares as at the year end.
V. Generic Names of Three Principal Products of Company
Item Code No. 3 2 0 4 1 7 . 5 1
Product Description H O S T A P E R M G R E E N G N X
Item Code No. 2 9 2 4 1 0 . 1 9
Product Description A C E T O A C E T M O N O M E T H Y L A M I D E 7 0 %
Item Code No. 2 9 1 5 9 0 . 0 0
Product Description A C E T O A C E T I C M E T H Y L E S T E R
Statement Pursuant to Section 212 of the Companies Act, 1956
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda
Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010
Name of the Subsidiary Company
Chemtreat Composites India Private Limited
1. Financial year of the Subsidiary Company January 2009 – December 2009
2. Total issued and paid-up Share Capital of the Subsidiary Company
(a) Issued 500,000 equity shares of Rs. 10/- each
(b) Subscribed and Paid-up 500,000 equity shares of Rs. 10/- each
3. Extent of Interest of Clariant Chemicals (India) Limited at the end of the financial year 100%
4. Net aggregate amount of profits (Loss) of the Subsidiary Company not dealt with in the
accounts of the Clariant Chemical (India) Limited
(a) for the current financial year Rs. (52.39) Lakhs
(b) for the previous financial years Rs. 10.92 Lakhs
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda
Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

Chemtreat Composites India Private Limited
Annual Report 2009
59
Directors‘ Report
Annexure to Directors‘ Report
Your directors are pleased to present the 23rd annual report and audited statement of accodunts
for the year ended December 31, 2009.
Financial Results
The financial performance of the Company for the year ended December 31, 2009 is summarized
below:
Rs. ‘000
2009 2008
Revenue 33,086 40,707
Expenditure (38,325) (50,859)
Loss before taxation (5,239) (10,152)
Less: Provision for taxation (incl. deferred tax) – (6,345)
Loss after tax (5,239) (3,807)
Add: Balance brought forward from previous year 1,092 4,899
Balance carried forward to balance sheet (4,147) 1,092
Review of Operations
The Company is a 100% Export Oriented Unit. The global economic & financial crisis
affected the Company’s performance. Sales were down at Rs. 298.5 Lakhs as against
Rs. 384.9 Lakhs in the previous year.
However, the Company continued its efforts of exploring new markets and succeeded in
establishing new market segments in India and Australia.
Dividend
The Board has not recommended any dividend for the year.
Particulars of Employees
There are no employees in respect of whom information pursuant to section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as
amended.
Directors
Mr. Dominik Strebel resigned with effect from February 20, 2009 and Mr. Walter Kindler was
appointed in his place. Mr. Heiner Meier , Mr. Walter Kindler and Mr. B L Gaggar were the
Directors of the Company as on December 31, 2009.
Mr. Heiner Meier resigned with effect from January 1, 2010 and Mr. Peter Palm was appointed
in his place. Mr. Walter Kindler resigned with effect from January 1, 2010 and Dr. H. Schloemer
was appointed in his place.
Directors’ Responsibility Statement
In terms of section 217 (2AA) of the Companies Act, 1956 your directors confirm that:
(a) in the preparation of the annual accounts, the applicable accounting standards have been
followed;
(b) they have selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view of
the state of affairs of the Company as at December 31, 2009 and of the loss of the Company
for that year;
(c) they have taken proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of the Companies Act, 1956 for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities.
(d) they have prepared the annual accounts on a going concern basis.
Conservation of Energy, Research and Development, Technology Absorption,
Foreign Exchange Earnings and Outgo
Information required under section 217(1)(e) of the Companies Act, 1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed hereto and
forms part of the report.
Auditors
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the ensuing
Annual General Meeting and being eligible offers themselves for re-appointment.
For and on behalf of the Board of Directors
P. Palm B. L. Gaggar
Mumbai, February 19, 2010 Director Director
Information as per section 217(1)(e) read with Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 and forming part of the Directors' report for the year ended
December 31, 2009.
FORM-A
Particulars with respect to conservation of energy
A. Power and fuel consumption:
1. Electricity:
(a) Purchased:
2009 2008
Units (in ‘000 KwH) 327 278
Total amount (Rs. Lakhs) 17.66 14.87
Rate per Unit (Rs.) 5.39 5.35
(b) Own Generation:
(i)
Through diesel generator
Units (in ‘000 KwH) 6.99 20.89
Units per Litre of diesel oil 1.49 1.67
Cost per Unit (Rs.) 23.75 22.57
(ii) Through Steam turbine/generator Nil Nil
2. Furnace Oil (including L.S.H.S.)
Quantity (MT) 9.05 14.02
Total Cost (Rs. Lakhs) 3.21 5.32
Average rate (Rs. per Kg.) 35.47 37.97
3. Other internal generation Nil Nil
B. Consumption per unit of production:
The Company manufactures a wide variety of products. The products before reaching the
finished final stage pass through various operations in the different plants. It is, therefore,
not feasible to furnish the information in respect of consumption per unit of production.
FORM-B
Form of disclosure of particulars with respect to Technology Absorption, Research &
Development (R&D)
Research & Development
1. Specific Areas in which R&D carried out : Development of the pigmented polysilazane
by the Company
and chrome replacement coatings.
2. Benefits derived as a result of the above : Introduction of new products for Indian
R & D
Railways & automotive industry.
3. Future plan of action : Development of various coatings colours for
Indian Railways and chrome replacement
coatings for automotive parts.
Technology absorption, adaptation and innovation:
1. Efforts, in brief, made towards technology : New synthesis are successfully adopted &
absorption, adaptation and innovation scaled up with Group Support.
2. Benefits derived as a result of the above : The new products can be used as high quality
efforts, e.g. product improvement, cost chemicals in pharma applications.
reduction, product development, import
substitution etc.
3. In case of imported technology (imported :
during the last 5 years reckoned from the
beginning of the financial year), following
information may be furnished
(a) Technology imported : Polysilazanes manufacture and formulations
(b) Year of import : 2006
(c) Has technology been fully
absorbed
Foreign Exchange Earnings and
Outgo
: Formulations technology transfer was
successfully adopted and standardized in
2007.
: Refer Schedule 14: of Notes to Accounts Item
Nos. 14 to 16
For and on behalf of the Board of Directors
P. Palm B. L. Gaggar
Mumbai, February 19, 2010 Director Director

60 Chemtreat Composites India Private Limited
Annual Report 2009
Auditors‘ Report
To the Members of Chemtreat Composites India Private
Limited
1. We have audited the attached Balance Sheet of Chemtreat Composites India Private
Limited as at December 31, 2009, and also the Profit and Loss Account and the Cash Flow
Statement for the year ended on that date annexed thereto. These financial statements are
the responsibility of the Company’s management. Our responsibility is to express an opinion
on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards generally accepted in India.
Those Standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatement. An audit includes
examining on test basis, evidence supporting the amounts and disclosure in the financial
statements. An audit also includes assessing the accounting principles used and significant
estimates made by the management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003, (‘the Order’) issued by the
Central Government of India in terms of sub- section (4A) of Section 227 of the Companies
Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4
and 5 of the said Order to the extent applicable to the Company.
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:
(a) we have obtained all the information and explanation, which to the best of our knowledge
and belief were necessary for the purposes of our audit;
(b) in our opinion, proper books of account as required by law have been kept by the
Company, so far as appears from our examination of the books;
(c) the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by
this report are in agreement with the books of accounts;
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report comply with the Accounting Standards referred to in
sub-section (3C) of Section 211 of the Companies Act, 1956;
(e) on the basis of the written representations received from the directors, as on
December 31, 2009, and taken on record by Board of Directors, we report that
none of the directors of the Company are disqualified as on December 31, 2009
from being appointed as director, in terms of clause (g) of sub-section (1) of
Section 274 of the Companies Act, 1956; and
(f) in our opinion and to the best of our information and according to the explanations
given to us, the said accounts give the information required by the Companies
Act, 1956, in the manner so required and give a true and fair view in conformity with the
accounting principles generally accepted in India:
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at
December 31, 2009;
(ii) in the case of the Profit and Loss Account, of the loss of the Company for the year
ended on that date; and
(iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that
date.
For Deloitte Haskins & Sells
Chartered Accountants
Registration No. 117365W
A. C. Khanna
Place : Mumbai
Partner
Date : 19th February, 2010 Membership No.: 17814
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS’ REPORT TO THE
MEMBERS OF CHEMTREAT COMPOSITES INDIA PRIVATE LIMITED ON THE FINANCIAL
STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2009
(i) (a) The Company has maintained proper records showing full particulars including
quantitative details and situation of fixed assets.
(b) The Company has a programme of physical verification of Fixed assets. As per the said
programme, certain assets were physically verified during the last year. In our opinion,
the frequency of verification is reasonable having regard to the size of the Company
and the nature of its assets. According to the information and explanations given to
us, no material discrepancies were noticed on such verification.
(c) As per information and explanations given to us, there are no fixed assets disposed
off during the year. Therefore, the provisions of clause 4 (i)(c) of the Order are not
applicable to the Company.
(ii) (a) The Inventories have been physically verified during the year by the management. In
our opinion, the frequency of verification is reasonable.
(b) In our opinion, the procedures of physical verification of the inventories followed by
the management are reasonable and adequate in relation to the size of the Company
and the nature of its business.
(c) In our opinion and according to the information and explanations given to us, the
Company is maintaining proper records of inventory. The discrepancies noticed on
verification between the physical stocks and the book records were not material and
have been properly dealt with in the books of account.
(iii) (a) According to the information and explanations given to us, the Company has not
granted any loans, secured or unsecured, to companies, firms or other parties covered
in the register maintained under Section 301 of the Companies Act, 1956. Accordingly,
sub-clauses (b), (c) and (d) are not applicable.
(b) According to the information and explanations given to us, the Company has not taken
any loans, secured or unsecured, from companies, firms or other parties covered in
the register maintained under Section 301 of the Companies Act, 1956. Accordingly,
sub-clauses (f) and (g) are not applicable.
(iv) In our opinion and according to the information and explanations given to us, having regard to
the explanations that certain items purchased / sold are of special nature for which suitable
alternative sources do not exist for obtaining comparative quotations, there are adequate
internal control systems commensurate with the size of the Company and the nature of its
business with regard to purchase of inventory and fixed assets and for the sale of goods.
Further, on the basis of our examination of the books and records of the Company carried
out in accordance with the auditing standards generally accepted in India and according to
the information and explanations given to us, we have neither come across nor have been
informed of any continuing failure to correct major weaknesses in the aforesaid internal
control system.
(v) (a) In our opinion and according to the information and explanations given to us, there
have been no contracts or arrangements referred to in Section 301 of the Act during
the year to be entered in the register required to be maintained under Section 301 of
the Companies Act, 1956.
(b) Sub-clause (b) is not applicable.
(vi) In our opinion and according to the information and explanations given to us, the Company
has not accepted any deposits from the public within the meaning of Section 58A and
58AA or any other relevant provisions of the Companies Act, 1956 and the Companies
(Acceptance of Deposits) Rules 1975. Therefore, the provisions of clause 4 (vi) of the Order
are not applicable to the Company.
(vii) The Company does not have an internal audit system; however the internal control systems
are comensurate with the size and the nature of its business.
(viii) We are informed that the Central Government has not prescribed maintenance of cost records
under Section 209(1)(d) of the Companies Act, 1956 in respect of the Company's business.
Therefore, the provisions of clause 4 (viii) of the Order are not applicable to the Company
(ix) (a) According to the records of the Company, Provident Fund, Investor Education
and Protection Fund, Employees’ State Insurance, Income tax, Sales tax,
Wealth tax, Service tax, Customs duty, Excise duty, cess and other material statutory
dues applicable to it have been generally regularly deposited during the reporting
period with the appropriate authorities.
According to the information and explanations given to us, no undisputed amounts
payable in respect of above were in arrears, as at December 31, 2009 for a period of
more than six months from the date they became payable.
(b) According to the information and explanations given to us and the records of the
Company examined by us, there are no dues of income tax, sales tax, wealth tax,
service tax, customs duty, excise duty and cess that have not been deposited on
account of any dispute.
(x) In our opinion, the accumulated losses of the company are less than fifty percent of its
networth and it has incurred cash losses during the year covered by our audit and also in
the immediately preceding financial year.
(xi) In our opinion and according to the information and explanations given to us, there were no
borrowings or dues payable to any financial institution or bank or debenture holders during
the reporting year.
(xii) Based on our examination of the records and the information and explanations given to us,
the Company has not granted any loans and advances on the basis of security by way of
pledge of shares, debentures and other securities. Therefore, the provisions of clause 4 (xii)
of the Order are not applicable to the Company.
(xiii) In our opinion, the Company is not a chit fund or nidhi/mutual benefit fund/
society. Therefore the provisions of clause 4 (xiii) of the Order are not applicable to
the Company.
(xiv) In our opinion the Company is not dealing in or trading in shares, securities, debentures
and other investments. Accordingly, the provisions of clause 4 (xiv) of the Order are not
applicable to the Company.
(xv) In our opinion and according to the information and explanations given to us, the
Company has not given any guarantee for loans taken by others from banks or financial
institutions. Accordingly, the provisions of clause 4 (xv) of the Order are not applicable to
the Company.
(xvi) In our opinion and according to the information and explanations given to us, there are no
term loans raised during the year under audit and hence, the provisions of clause 4 (xvi) of
the Order are not applicable to the Company.
(xvii)
According to the information and explanations given to us and on an overall examination of
the balance sheet of the Company, we report that funds raised on short-term of Rs. 52,692
(‘000) have been used for long-term investment.
(xviii) According to the information and explanations given to us, the Company has not made
any preferential allotment of shares to parties and Companies covered in the register
maintained under Section 301 of the Companies Act, 1956.
(xix) The Company has not issued any secured debentures. Therefore, the provisions of clause 4
(xix) of the Order are not applicable to the Company.
(xx)
(xxi)
The Company has not raised any money by public issue during the year. Therefore, the
provisions of clause 4 (xx) of the Order are not applicable to the Company.
According to the information and explanations furnished by the management, which have
been relied upon by us, no fraud on or by the Company has been noticed or reported to/by
management during course of our audit.
For Deloitte Haskins & Sells
Chartered Accountants
Registration No. 117365W
A. C. Khanna
Place : Mumbai
Partner
Date : 19th February, 2010 Membership No.: 17814

61
Balance Sheet
as at 31st December, 2009
Profit and Loss Account
for the year ended 31st December, 2009
Schedule
31-12-09
Rs. '000
31-12-08
Rs. '000
SOURCES OF FUNDS
Shareholders' funds
Share capital 1 5,000 5,000
Reserves and surplus 2 4,956 6,048
9,956 11,048
Loan funds
Unsecured loans 3 66,000 63,000
75,956 74,048
APPLICATION OF FUNDS
Fixed assets 4
Gross block 82,039 79,811
Less : Accumulated depreciation 21,686 14,774
Net block 60,353 65,037
Capital work-in-progress and advances, etc. 2,295 2,561
62,648 67,598
Current assets, loans and advances
Inventories 5 9,921 8,757
Sundry debtors 6 2,952 953
Cash and bank balances 7 1,639 7,964
Loans and advances 8 1,656 726
16,168 18,400
Less : Current liabilities
Liabilities 9 7,007 11,950
7,007 11,950
Net current assets 9,161 6,450
Profit and loss account 4,147 –
75,956 74,048
Notes on Balance Sheet and Profit and Loss
Account 14
INCOME
Schedule
2009
Rs. '000
2008
Rs. '000
Sales – Gross 30,213 38,487
Less : Excise duty 362 –
Sales – Net 29,851 38,487
Other income 10 3,235 2,220
EXPENDITURE
33,086 40,707
Cost of materials 11 3,540 11,619
Interest Paid 12 45 –
Depreciation 4 6,912 6,816
Other expenditure 13 27,828 32,424
38,325 50,859
LOSS BEFORE TAXATION (5,239) (10,152)
Provision for taxation
Deferred tax – (6,345)
LOSS AFTER TAXATION (5,239) (3,807)
Balance brought forward from
previous year 1,092 4,899
Balance carried to the balance sheet (4,147) 1,092
Notes on Balance Sheet and Profit and Loss
Account 14
Basic and Diluted earnings per share
(Rupees)
Face value per share
(Rupees)
(10.48) (7.61)
10.00 10.00
Per our report attached
For and on behalf of the Board
For Deloitte Haskins & Sells P. Palm Director
Chartered Accountants
A. C. Khanna
Partner
B. L. Gaggar Director
Mumbai, 19th February, 2010 Mumbai, 19th February, 2010

62 Chemtreat Composites India Private Limited
Annual Report 2009
Cash Flow Statement
for the year ended 31st December, 2009
Schedules
forming part of the Balance Sheet
2009
Rs. '000
2008
Rs. '000
A. CASH FLOW FROM OPERATING ACTIVITIES :
Net Loss before taxation (5,239) (10,152)
Adjustments for :
Depreciation 6,912 6,816
Unrealised foreign exchange (gain)/ loss (Net) 35 25
VAT setoff admissible written-off – 2,822
Service tax recoverable written off – 1,228
Interest expenses 45 –
Assets written-off – 235
Operating profit before working capital changes 1,753 974
Adjustments for :
Trade and other receivables (2,964) 699
Inventories (1,164) 9,802
Trade, other payables and provisions (4,943) (5,849)
Cash used in operations (7,318) 5,626
Direct taxes paid- (Net of refunds) – (13)
Net cash used in operating activities (7,318) 5,613
B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of fixed assets (1,962) (6,156)
Net Cash used in investing activities (1,962) (6,156)
C. CASH FLOW FROM FINANCING ACTIVITIES :
Loan received from Holding Company 3,100 7,500
Loans repaid to Holding Company (100) –
Interest paid (45) –
Net Cash from financing activities 2,955 7,500
Net increase in cash and cash equivalents (A+B+C) (6,325) 6,957
Cash and cash equivalents as at beginning of the year 7,964 1,007
Cash and cash equivalents as at the end of the year
(Refer Schedule 7) 1,639 7,964
Notes :
1. The Cash flow has been prepared under the "Indirect Method" as set out in Accounting
Standard-3 on Cash flow statement notified by the Companies (Accounting Standards)
Rules, 2006.
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated
between investing and financing activities.
3. Figures for the previous year have been regrouped wherever necessary to conform to
the current year's classification.
Per our report attached to the Balance Sheet For and on behalf of the Board
For Deloitte Haskins & Sells P. Palm Director
Chartered Accountants
A. C. Khanna B. L. Gaggar Director
Partner
Mumbai, 19th February, 2010 Mumbai, 19th February, 2010
SCHEDULE 1 : SHARE CAPITAL 31-12-09
Rs. '000
31-12-08
Rs. '000
Authorised
5,00,000 Equity shares of Rs. 10/- each 5,000 5,000
Issued and subscribed
5,00,000 Equity shares of Rs. 10/- each fully paid up 5,000 5,000
Notes :
Of the above :
(a) The entire issued equity share capital is held by Clariant Chemicals (India) Limited, the
holding company, ultimate holding company being Clariant AG, Switzerland.
(b) 296,400 equity shares of Rs. 10/- each, were allotted as fully paid up bonus shares by
capitalisation of Rs. 2,964,000 from Securities premium account.
SCHEDULE 2 : reserves and surplus 31-12-09
Rs. '000
31-12-08
Rs. '000
Securities premium account
As per last Balance sheet 4,956 4,956
Profit and loss account – 1,092
4,956 6,048
SCHEDULE 3 : UNSECURED LOANS 31-12-09
Rs. '000
Demand loan (Interest free)
31-12-08
Rs. '000
From the holding company 66,000 63,000
66,000 63,000
SCHEDULE 4 : FIXED ASSETS Rs. '000
GROSS BLOCK DEPRECIATION NET BLOCK
As at
31-12-2008
Additions Deductions As at
31-12-2009
As at
31-12-2008
Deductions For the
year
As at
31-12-2009
As at
31-12-2009
As at
31-12-2008
Tangible Assets
Land freehold 884 – – 884 – – – – 884 884
Buildings 12,161 – – 12,161 410 – 198 608 11,553 11,751
Plant, machinery, equipment etc. 64,949 2,219 – 67,168 14,176 – 6,617 20,793 46,375 50,773
Furniture, fixtures and office appliances 1,817 9 – 1,826 188 – 97 285 1,541 1,629
Total 79,811 2,228 – 82,039 14,774 – 6,912 21,686 60,353
Previous year 76,447 3,663 299 79,811 8,022 64 6,816 14,774 65,037
Capital work-in-progress 785 1,885
Advances against capital orders 1,510 676
2,295 2,561
62,648 67,598

63
Schedules
forming part of the Balance Sheet
SCHEDULE 5 : INVENTORIES 31-12-09
Rs. '000
31-12-08
Rs. '000
At lower of cost and net realisable value
(As certified by the Management)
Stores and spare parts 616 715
Raw materials 4,611 5,863
Packing materials 52 40
Finished goods 4,364 2,139
Work-in-progress 278 –
9,921 8,757
SCHEDULE 6 : SUNDRY DEBTORS 31-12-09
Rs. '000
Unsecured – Considered good
31-12-08
Rs. '000
Over six months 222 –
Other debts 2,730 953
[includes Rs. Nil; Previous Year Rs. 26 ('000) due from holding
Company]
2,952 953
SCHEDULE 7 : CASH AND BANK BALANCES 31-12-09
Rs. '000
31-12-08
Rs. '000
Cash on hand 1 3
With Scheduled Banks :
On current accounts 1,638 7,961
1,639 7,964
SCHEDULE 8 : LOANS AND ADVANCES 31-12-09
Rs. '000
(Unsecured – considered good, unless otherwise stated)
31-12-08
Rs. '000
Advances recoverable in cash or in kind or for value to be
received 820 463
VAT set off admissible 522 –
Advance payment of Income tax (Net of provision for taxation) 44 44
Balances with customs and excise on current account 270 219
1,656 726
SCHEDULE 9 : CURRENT LIABILITIES 31-12-09
Rs. '000
Sundry creditors
31-12-08
Rs. '000
Due to micro enterprises and small enterprises – –
(See Note 6, Schedule 14)
Due to holding company 2,835 7,973
Due to others 4,172 3,977
7,007 11,950
Schedules
forming part of the Profit and Loss Account
SCHEDULE 10 : OTHER INCOME 2009
Rs. '000
2008
Rs. '000
Exchange Gain (Net) – 1,434
Income from Services rendered 980 –
Sale of By-Product 114 183
[excluding Excise Duty Rs. 18 ('000); Previous Year Rs. 29 ('000)]
Sale of Packing Materials to Holding Company – 20
Sale of Waste/Scrap Materials – 204
Sundry Credit Balances Written back – 242
Insurance Claim 2,001 –
Miscellaneous income 140 137
3,235 2,220
SCHEDULE 11 : COST OF MATERIALS 2009
Rs. '000
2008
Rs. '000
Raw materials
Opening Stock 5,863 8,525
Purchases 4,444 1,645
Less : Closing stock (4,611) (5,863)
Raw material Consumption 5,696 4,307
Packing materials
Opening Stock 40 48
Purchases 359 257
Less : Closing stock (52) (40)
Packing material Consumption 347 265
Finished goods
Opening Stock 2,139 8,975
Less : Closing stock (4,364) (2,139)
(2,225) 6,836
Work-in-progress
Opening Stock – 211
Less : Closing stock (278) –
(278) 211
3,540 11,619
SCHEDULE 12 : INTEREST PAID 2009
Rs. '000
2008
Rs. '000
Interest Paid
Others 45 –
45 –
SCHEDULE 13 : OTHER EXPENDITURE 2009
Rs. '000
2008
Rs. '000
Stores and Spare parts etc. consumed 642 871
Repairs and maintenance :
Plant and machinery 489 987
Others * 1,188 1,147
Power and fuel 2,140 2,043
Rates and taxes (including water charges) 387 106
Insurance * 13 82
Clearing, forwarding and transport * 2,828 4,316
Personnel Cost * 8,394 9,441
Travelling and conveyance * 2,567 2,802
Commission 401 –
Legal, professional & consultancy (See Note 8, Schedule 14) 2,551 3,237
Assets written-off – 235
Excise duty 201 161
Exchange loss (Net) 629 –
Personnel protection and safety expense 1,185 1,039
Labour charges * 2,000 1,152
IT related cost * 1,474 162
VAT Set off Admissible Written off – 2,822
Service Tax Recoverable written off – 1,228
Miscellaneous * 739 593
27,828 32,424
* See Note 17, Schedule 14

64 Chemtreat Composites India Private Limited
Annual Report 2009
Notes
schedule 14 : Notes on the Balance Sheet and Profit and Loss Account for the year ended 31st December, 2009
1. Significant Accounting Policies
The financial statements are prepared at historical cost on the accrual basis of
accounting and in accordance with the standards on accounting notified by the
Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of
the Companies Act, 1956.
The significant accounting policies are as follows :
I. Revenue Recognition
The Company recognises sale of goods on transfer of significant risks and
rewards of ownership of the goods to the buyer. Sales are net of excise duty,
sales tax and trade discounts, wherever applicable.
Dividend income on investments is accounted for when the right to receive the
payment is established.
II.
Excise Duty
Excise duty payable on products is accounted for at the time of dispatch of goods
from the factories but is accrued for stocks held at the year end.
Excise Duty related to the difference between the closing stock and opening
stock of finished goods has been recognized separately in the profit and loss
account under schedule of ‘Other Expenditure’.
IX.
(B) The current tax, if any, is determined as the amount of tax payable in respect
of the estimated taxable income for the period.
(C) The deferred tax charge or credit is recognised, using prevailing enacted or
substantively enacted tax rates. Where there are unabsorbed depreciation
or carry forward losses, deferred tax assets are recognised only if there is
virtual certainty of realisation of such assets. Other deferred tax assets are
recognised only to the extent there is reasonable certainty of realisation in
future. Deferred tax assets/liabilities are reviewed at each Balance Sheet
date based on developments during the reporting period and available case
laws, to reassess realization/liabilities.
Provisions/Contingencies
Provision is recognised when the Company has a present obligation as a result
of past event; it is probable that an outflow of resources embodying economic
benefit will be required to settle the obligation, in respect of which a reliable
estimate can be made. Provisions are not discounted to its present value and
are determined based on best estimate of the expenditure required to settle the
obligation at the Balance Sheet date. These are reviewed at each Balance Sheet
date and adjusted to reflect the current best estimate. A contingent liability
is disclosed, unless the possibility of an outflow of resources embodying the
economic benefit is remote.
III.
IV.
Employee Benefits/Leave Encashment
As there are no permanent employees of the Company, no provision for employee
benefits/leave encashment is required to be made.
Fixed Assets and Depreciation
(A) All fixed assets are stated at cost less accumulated depreciation.
(B) The cost comprises the purchase price and any other attributable cost of
bringing the asset to its working condition for its intended use.
(C) Depreciation on the fixed asset is provided on the straight line method at
the rates and in the manner specified in Schedule XIV of the Companies Act,
1956, except for:
(a) Plant, machinery and equipment (except Laboratory equipment, Fire
Fighting and Weighing Machine) over their useful life of 10 Years as
determined by the Company on a Straight Line Basis.
(c) Computers and Printers on which 25% straight line method is applied.
V. Inventories
Inventories are valued at the lower of cost and estimated net realisable value
after providing for obsolescence. The cost of inventories is generally arrived at
on the following bases :
Raw materials, packing materials,
trading items and store and spares : Weighted average cost
Finished goods and work-in-progress : Absorption costing at works cost
VI. Sundry Debtors/Loans and Advances
Sundry debtors and loans and advances are stated after making adequate
provision for doubtful debts/advances, if any.
VII.
Foreign Currency Translations
(A) Foreign currency transactions are accounted at the rate prevailing on the
date of transaction.
(B) Monetary items denominated in foreign currency, are translated at the
exchange rate prevailing on the last day of the reporting period.
(C) Non-monetary items other than fixed assets, which are carried in terms of
historical cost denominated in a foreign currency, are reported using the
exchange rate at the date of transaction.
(D) Gain or loss arising out of translation/conversion is taken credit for or
charged to the Profit and Loss Account.
VIII. Income Tax
(A) Income-tax expense comprises current tax and deferred tax charge or
credit.
2. Segment Information for the year ended 31st December, 2009 (As required by
Accounting Standard (AS) - 17 Segment Reporting)
(a) The Company operates in only one primary business segment of Speciality
Chemicals i.e. manufacturing synthetic resins Consequently, disclosure for
primary segment under AS 17 – Segment Reporting is not applicable to the
Company.
(b) The secondary segments of the Company are geographical segments mainly :
(i) India
(ii) Outside India
Information about Secondary Segments :
India
2009
Rs’000
Outside
India
Total
2008
Rs’000
India Outside
India
Total
External sales 4,335 25,516 29,851 – 38,487 38,487
Segment assets 76,309 2,463 78,772 85,027 927 85,954
Additions to fixed assets 1,962 – 1,962 6,156 – 6,156
Note : Total assets exclude the Advance payment of Income Tax Rs. 44 (‘000)
[Previous year Rs. 44 (‘000)].
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures”
are given below :
A. Relationship :
(a) Holding Company :
Clariant Chemicals (India) Limited, holds 100% equity shares in the
Company.
EBITO Chemiebeteiligungen AG, Clariant International AG and Clariant
Participations AG together hold 63.40% equity shares in the Clariant
Chemicals (India) Limited, The ultimate holding company is Clariant AG,
Switzerland.
(b) Other related parties in the Clariant group where common control
exists and with whom the company has transactions :
Clariant Advanced Materials GmbH Clariant Life Science Molecules
(Florida) Inc.
Clariant Corporation
Kion Specialty Polymers
Clariant (Japan) KK
(c) Key Management Personnel :
H. J. Meier – Director (upto December 31, 2009).

Notes
65
B. During the year following transactions were entered into with related parties :
Name of party Year Sale of
Goods
Purchase
of goods
Services
received
Purchase
of Fixed
Assets
Loans
taken
Loans
Repaid
Amount
Payable at the
year end #
Rs. '000
Amount
receivable at the
year end
Clariant Chemicals (India) Ltd. 2009 – – 11,594 – 3,100 100 68,835 –
2008 * 20 48 11,500 2,176 7,500 – 70,973 26
Clariant Advanced Material GmbH 2009 7,364 – – – – – – 2302
2008 17,243 – – – – – – 910
Clariant (Japan) KK 2009 3221 – – – – – – 68
2008 256 – – – – – – 17
Kion Specialty Polymers 2009 – – – – – – – –
2008 7,242 – – – – – – –
Clariant Corporation 2009 8188 – – – – – – –
2008 9,021 – – – – – – –
Clariant Life Science Molecules (Florida) Inc. 2009 – 1200 – – – – – –
2008 – – – – – – – –
# Included in Unsecured Loan Rs. 66,000 ('000); [Previous Year Rs. 63,000 ('000)], Sundry Creditors Rs. 2,835 ('000); [Previous Year Rs.7,973 ('000)] .
* Sale of packing material.
31-12-2009
Rs. '000
31-12-2008
Rs. '000
4. Estimated amount of contracts remaining to be
executed on capital account and not provided
for (Net of advances) 4,490 5,325
5. Deferred taxes :
During the year ended 31st December 2009, the
Company has incurred losses resulting in unabsorb
carry forward tax losses. The Company is eligible for
a tax holiday under section 10B of the Indian Incometax
Act, 1961. Though the management is confident
of generating profits in the future, there is currently
no convincing evidence of virtual certainty that the
Company would reverse the tax loss carry forward
beyond the tax holiday period. Accordingly the
Company has not recognised any deferred tax assets
resulting from the carry forward tax losses. Further,
deffered tax liability on account of timing differences
in case of depreciation does not arise by virtue of
explanation 6 to Sec. 43 (6) of the Indian Incometax
Act, 1961 where the book depreciation shall be
deemed to be the depreciation actually allowed under
the Income-tax Act.
6. Disclosure required under the Micro, Small
and Medium Enterprises Development Act, 2006
(the Act) are given as follows :
(a) Principal amount due — —
Interest due on the above — —
(b) Interest paid during the year beyond the appointed
day — —
(c) Amount of interest due and payable for the period
of delay in making payment without adding the
interest specified under the Act — —
(d) Amount of interest accrued and remaining unpaid
at the end of the year — —
(e) Amount of further interest remaining due and
payable even in the succeeding years, untill such
date when the interest dues as above are actually
paid to the small enterprise for the purpose of
disallowance as a deductible expenditure under
section 23 of the Act — —
The above information and that given in
Schedule- 9 'Liabilities' regarding micro enterprise and
small enterprises has been determined on the basis
of information available with the Company. This has
been relied upon by the auditors.
7. Earnings per share :
(a) Net loss after taxation (Rupees '000) (5,239) (3,807)
(b) Number of equity shares outstanding 500,000 500,000
(c) Basic and Diluted loss per share (In Rupees) (10.48) (7.61)
(d) Face value per share (In Rupees) 10 10
31-12-2009
Rs. '000
31-12-2008
Rs. '000
8. Legal, professional & consultancy in Schedule
13 : Other expenditure include :
Audit fees and fees for other services : (Excluding
service tax)
(a) Audit fees 300 300
(b) Other services 300 525
600 825
9. Capacity and production :
Class of goods
Annual
Installed
Capacity
M. Tonnes
2009 2008
Production*
M. Tonnes
Annual
Installed
Capacity
M. Tonnes
Production*
M. Tonnes
Synthetic Resins 750.000 16.253 750.000 10.675
* Excluding captive consumption and recovered solvents 5.44 M.Tonnes.
Notes :
1. The classification between the class of goods and the installed capacity have been
certified by the Director on which the auditors have placed reliance, this being a
technical matter.
2. Licensed capacity per annum not indicated due to the abolition of Industrial
Licenses as per Notification No. 477(E) dated 25th July, 1991 issued under The
Industries (Development and Regulations) Act 1951.
10. Sales , Opening and Closing Stock :
Class of goods Opening Stock Closing Stock Sales
(Inclusive of excise
duty)
Quantity
M. Tonnes
Value Quantity*
Rs. ‘000 M. Tonnes
Value Quantity**
Rs. ‘000 M. Tonnes
Value
Rs. ‘000
Synthetic Resins 2.617 2,139 9.298 4,364 9.034 30,213
(8.054) (8,975) (2.617) (2,139) (16.069) (38,487)
** Excludes free samples 0.091 M. Tonnes (Previous Year 0.037 M. Tonnes) and
material lost in transit 0.369 M. Tonnes (Previous Year Nil).
* Excludes write-off 0.078 M.Tonnes (Previous Year 0.006 M. Tonnes).
11. Raw Materials consumed :
Quantity
M.Tonnes
2009 2008
Value
Rs. ‘000
Quantity
M.Tonnes
Value
Rs. ‘000
(a) Silanes 25.137 4,696 4.811 2,855
(b) Others * 1,000 1,452
5,696 4,307
* None of the items individually exceed 10% of the total value of raw materials
consumed

66 Chemtreat Composites India Private Limited
Annual Report 2009
12. Consumption of raw materials :
2009 2008
% of total Value % of total
Consumption Rs. ‘000 Consumption
Value
Rs. ‘000
(a) Raw materials :
Imported 47.15 2,686 46.46 2,001
Indigenous 52.85 3,010 53.54 2,306
100.00 5,696 100.00 4,307
(b) Components and spare parts referred to in Paragraph 4D (c ) of Schedule VI of the
Companies Act, 1956 are assumed to be incorporated in the goods produced and
not those used for maintenance of plant and machinery.
13. Disclosure in respect of Derivative Instruments :
(a) During the year, the Company has not used any derivative Instruments to hedge its
exposure in foreign currency.
(b) Foreign currency exposures not covered by a derivative instrument.
Amount receivable on account of export of goods and services.
31-12-2009 31-12-2008
Currency Amount in Rs. ‘000 Amount in Rs. ‘000
foreign currency
foreign currency
USD 3,450 161 – –
EUR 34,248 2,302 13,549 927
2,463 927
31-12-2009
Rs. '000
31-12-2008
Rs. '000
14. Value of imports (C.I.F.) :
Raw materials 1,458 –
15. Earnings in foreign exchange :
(a) Exports (F.O.B.) 23,903 35,604
(b) Insurance and freight 1,613 2,883
(c) Exchange gain (net) – 1,434
Statement pursuant to Part IV of Schedule VI to The Companies Act, 1956
Balance Sheet Abstract and Company’s General Business Profile
31-12-2009
Rs. '000
31-12-2008
Rs. '000
16. Expenditure in foreign currency :
(a) Exchange Loss (net) 629 –
(b) Product registration fee 169 –
17. The Company has entered in to a cost sharing
agreement dated 30th May, 2006 with the holding
company for reimbursement of costs and accordingly
expenses of Rs. 11,594 (‘000) [Previous Year :
Rs. 11,500 (‘000)] have been reimbursed by the Company
and included in Schedule 13 : Other Expenditure under
the respective expense head as follows :
Expense head
Personnel cost 8,080 9,143
Travelling and conveyance 1,725 1,962
IT related cost 1,475 162
Repairs and maintenance – Others 45 32
Labour charges 93 62
Clearing, forwarding & transport 6 –
Miscellaneous expenses 170 139
Total 11,594 11,500
18. Figures for the previous year have been regrouped wherever necessary to conform to
the current year’s classification.
For and on behalf of the Board
P. Palm Director
B. L. Gaggar Director
Mumbai, 19th February, 2010
I. Registration Details
Registration No. 1 1 – 4 3 2 3 5 State Code 1 1
II.
III.
Balance Sheet Date 3 1 – 1 2 – 2 0 0 9
Date Month Year
Capital raised during the year (Amount in Rs. Thousands)
Public Issue N I L Right Issue N I L
Bonus Issue N I L Private Placement N I L
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)
Total Liabilities* 8 2 9 6 3 Total Assets 8 2 9 6 3
Sources of Funds
Paid-up Capital 5 0 0 0 Reserves and Surplus 4 9 5 6
Secured Loans N I L Unsecured Loans 6 6 0 0 0
Application of Funds
Net Fixed Assets 6 2 6 4 8 Investments N I L
Net Current Assets 9 1 6 1 Miscellaneous Expenditure N I L
IV.
Accumulated Losses 4 1 4 7
*Including Shareholders’ funds
Performance of Company (Amount in Rs. Thousands)
Turnover (Gross Revenue) @ 3 3 0 8 6 Total Expenditure 3 8 3 2 5
@ Includes Other Income Rs. 3235
+ – Profit Before Tax + – Profit After Tax
P 5 2 3 9 P 5 2 3 9
Earnings Per Share in Rs.** ( 1 0 . 4 8 ) Dividend Rate % N I L
** Earnings per share has been computed by dividing profit after tax by the total number of issued equity shares as at the year end.
V. Generic Names of Three Principal Products of Company
Item Code No. Product Description 3 9 1 0 0 0 1 0 – C L A R I A N T K I O N M L 3 3 / C 12
Item Code No. Product Description 3 9 1 0 0 0 1 0 – C L A R I A N T K I O N H T T 1 8 0 0
Item Code No. Product Description 3 9 1 0 0 0 9 0 – T U T O P R O M M A T T H D
For and on behalf of the Board
P. Palm Director
Mumbai, 19th February, 2010 B. L. Gaggar Director

Clariant Chemicals (India) Limited — Consolidated
67
Auditors‘ Report to the Members
Auditors’ Report to the Board of Directors of Clariant Chemicals (India) Limited on the Consolidated Financial
Statements of Clariant Chemicals (India) Limited
1. We have audited the attached Consolidated Balance Sheet of
Clariant Chemicals (India) Limited and its subsidiary (the Clariant
Chemicals (India) Limited Group), as at 31st December, 2009 and
also the Consolidated Profit and Loss Account and the Consolidated
Cash Flow Statement for the year ended on that date annexed
thereto. These financial statements are the responsibility of
Clariant Chemicals (India) Limited’s management. Our responsibility
is to express an opinion on these financial statements based on
our audit.
2. We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards require
that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining on a test
basis, evidence supporting the amounts and disclosures in the
financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable
basis for our opinion.
3. We report that the consolidated financial statements have
been prepared by the Clariant Chemicals (India) Limited’s
management in accordance with the requirements of Accounting
Standard (AS) 21, Consolidated Financial Statements, notified by
the Companies (Accounting Standards) Rules, 2006.
4. In our opinion and to the best of our information and according to
the explanations given to us, the attached Consolidated Financial
Statements give a true and fair view in conformity with the
accounting principles generally accepted in India:
(i)
(ii)
in the case of the Consolidated Balance Sheet, of the state
of affairs of the Clariant Chemicals (India) Limited Group as
at 31st December, 2009;
in the case of the Consolidated Profit and Loss Account, of
the profit of the Clariant Chemicals (India) Limited Group for
the year ended on that date; and
(iii) in the case of the Consolidated Cash Flow Statement,
of the cash flows of the Group for the year ended on
that date.
Mumbai: 19th February, 2010
For Deloitte Haskins & Sells
Chartered Accountants
Registration No. 117365W
A. C. Khanna
Partner
Membership No.: 17814

68 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
Consolidated Balance Sheet
as at 31st December, 2009
Schedule
31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
SOURCES OF FUNDS
Shareholders' funds
Share capital 1 2666.07 2666.07
Reserves and surplus 2 32061.13 29097.60
34727.20 31763.67
Loan funds
Unsecured loans 3 204.78 309.07
204.78 309.07
Deferred tax liability – Net (See note 6, Schedule 17) — 254.94
34931.98 32327.68
APPLICATION OF FUNDS
Fixed assets 4
Gross block 36017.85 39816.46
Less : Accumulated depreciation and impairment 21301.71 23538.07
Net block 14716.14 16278.39
Capital work-in-progress and advances, etc. 606.22 1072.54
15322.36 17350.93
Fixed assets held for disposal (See note 14, Schedule 17) 792.34 —
Investments 5 12124.95 5459.47
Deferred tax asset – Net (See note 6, Schedule 17) 275.72 —
Current assets, loans and advances
Inventories 6 7764.24 10631.55
Sundry debtors 7 14489.15 13219.68
Cash and bank balances 8 1713.01 921.95
Loans and advances 9 5648.70 5695.75
29615.10 30468.93
Less : Current liabilities and provisions
Liabilities 10 16614.62 12884.63
Provisions 11 6583.87 8067.02
23198.49 20951.65
Net current assets 6416.61 9517.28
34931.98 32327.68
Notes on balance sheet and profit and loss account 17
Per our report attached
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

69
Consolidated Profit and Loss Account
for the year ended 31st December, 2009
2009
Rs. Lakhs
2008
Rs. Lakhs
Schedule
INCOME
Sales – Gross 97624.37 100529.74
Less : Excise duty 5191.73 8505.81
Sales – Net 92432.64 92023.93
Other income 12 2663.17 2530.26
95095.81 94554.19
EXPENDITURE
Cost of materials 13 54558.89 58265.63
Personnel cost 14 6158.71 7229.91
Interest (Net) 15 17.12 (18.29)
Depreciation/Amortisation 4 1965.18 2319.55
Impairment of fixed assets 4 136.98 728.62
Other expenditure 16 14340.70 16037.79
77177.58 84563.21
Less : Service charges recovered 790.80 673.23
76386.78 83889.98
PROFIT BEFORE EXCEPTIONAL ITEMS AND TAXATION 18709.03 10664.21
Exceptional items (See note 12, Schedule 17) 2450.46 48.00
PROFIT AFTER EXCEPTIONAL ITEMS AND BEFORE TAXATION 16258.57 10616.21
Provision for taxation
Current tax 5958.00 3792.00
Deferred tax (530.66) (241.74)
Fringe benefit tax 39.00 118.50
(Excess)/Short provision for taxation in respect of earlier years 30.77 248.09
PROFIT AFTER TAXATION 10761.46 6699.36
Balance brought forward from previous year 1097.45 999.35
Available for Appropriation 11858.91 7698.71
APPROPRIATED AS FOLLOWS
General reserve 1081.36 674.83
Interim dividend 2666.07 —
Proposed dividend (Final) 3999.11 5065.54
Corporate tax on dividend (Interim & Final) 1132.75 860.89
Balance carried to the balance sheet 2979.62 1097.45
11858.91 7698.71
Notes on balance sheet and profit and loss account 17
Basic and Diluted earnings per share (Rupees) (See note 8, Schedule 17) 40.36 25.13
Face value per share (Rupees) 10.00 10.00
Per our report attached to the Balance Sheet
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

70 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
Consolidated Cash Flow Statement
for the year ended 31st December, 2009
A. CASH FLOW FROM OPERATING ACTIVITIES :
2009
Rs. Lakhs
2008
Rs. Lakhs
Net Profit after exceptional items and before taxation 16258.57 10616.21
Adjustments for :
Depreciation/Amortisation 1965.18 2319.55
Impairment of fixed assets 136.98 728.62
Unrealised foreign exchange (gain)/loss (Net) (32.54) 60.21
Interest income (83.20) (171.67)
Dividend income (407.90) (171.56)
Loss/(profit) on sale of assets (Net) (80.31) (9.58)
Loss/(profit) on sale of investments (Net) (0.21) (0.29)
Provision for doubtful debts/advances (Net) 29.39 200.11
Provision for leave encashment (126.69) 4.52
Provision for ex-gratia gratuity (15.21) 4.24
Provision for gratuity (186.30) 267.80
Interest expenses 100.32 153.38
Assets written-off 100.69 392.98
Operating profit before working capital changes 17658.77 14394.52
Adjustments for :
Trade and other receivables (1131.92) 647.54
Inventories 2867.31 825.08
Trade, other payables and provisions 3695.79 (4453.14)
Cash generated from operations 23089.95 11414.00
Direct taxes paid – (Net of refunds) (6055.45) (3288.65)
Net cash from operating activities 17034.50 8125.35
B. CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of fixed assets (1024.62) (2719.66)
Sale of fixed assets 138.31 38.63
Purchase of investments (95164.44) (42571.83)
Sale of investments 88499.17 39730.92
Interest received 83.20 171.67
Dividend received 407.90 171.56
Net Cash used in investing activities (7060.48) (5178.71)

Consolidated Cash Flow Statement
71
C. CASH FLOW FROM FINANCING ACTIVITIES :
2009
Rs. Lakhs
2008
Rs. Lakhs
Repayment of borrowings (104.29) (98.09)
Interest paid (93.78) (147.17)
Dividend/dividend tax paid (8984.89) (3109.75)
Net Cash used in financing activities (9182.96) (3355.01)
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 791.06 (408.37)
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE YEAR 921.95 1330.32
CASH AND CASH EQUIVALENTS AS AT THE END OF THE YEAR (See note 3) (Refer Schedule 8) 1713.01 921.95
Notes :
1. The Cash flow has been prepared under the "Indirect Method" as set out in Accounting Standard-3 on Cash flow statement notified by the
Companies (Accounting Standards) Rules, 2006.
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.
3. Cash and cash equivalents at the end of the year include current account balances with banks of Rs. 221.71 lakhs (Previous Year : Rs. 161.63 lakhs)
which are restricted in use on account of unclaimed dividend/fixed deposit/interest on fixed deposit.
4. Figures for the previous year have been regrouped wherever necessary to conform to the current year's classification.
Per our report attached to the Balance Sheet
For Deloitte Haskins & Sells
Chartered Accountants
A. C. Khanna
Partner
Mumbai, 19th February, 2010
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

72 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
Schedules
forming part of the Consolidated Balance Sheet
SCHEDULE 1 : SHARE CAPITAL 31-12-09
Rs. Lakhs
Authorised
31-12-08
Rs. Lakhs
30000000 equity shares of Rs. 10/- each 3000.00 3000.00
Issued and subscribed
26660745 equity shares of Rs. 10/- each fully paid 2666.07 2666.07
Notes :
Of the above :
(a)
(b)
(c)
15010745 equity shares issued as fully paid up pursuant to a contract for a consideration other than cash.
8167080 equity shares are held by EBITO Chemiebeteiligungen AG.
6075000 equity shares are held by Clariant International AG.
2660000 equity shares are held by Clariant Participations AG.
The ultimate holding company being Clariant AG, Switzerland.
6690610 equity shares were allotted as fully paid up bonus shares by capitalisation of Rs. 669.06 lakhs from general reserve.
SCHEDULE 2 : RESERVES AND SURPLUS 31-12-09
Rs. Lakhs
Capital reserve
31-12-08
Rs. Lakhs
As per last Balance sheet 730.11 730.11
Capital redemption reserve
As per last Balance sheet 137.50 137.50
Securities premium account
As per last Balance sheet 3545.65 3545.65
Investment allowance reserve
As per last Balance sheet 20.00 20.00
Less : Transfer to General Reserve 20.00 —
— 20.00
General reserve
As per last Balance sheet 23566.89 22892.06
Add : Transfer from Investment allowance reserve 20.00 —
Transfer from Profit and loss account 1081.36 674.83
24668.25 23566.89
Profit and loss account 2979.62 1097.45
32061.13 29097.60
SCHEDULE 3 : UNSECURED LOANS 31-12-09
Rs. Lakhs
From others :
31-12-08
Rs. Lakhs
Interest-free sales tax deferral scheme granted by State Industries Promotion Corporation
of Tamil Nadu Limited (Repayable within one year Rs. 99.50 lakhs, Previous Year : Rs. 104.29 lakhs) 204.78 309.07
204.78 309.07

Consolidated Schedules
73
SCHEDULE 4 : FIXED ASSETS
As at
31-12-08
GROSS BLOCK DEPRECIATION/AMORTISATION/IMPAIRMENT NET BLOCK
Deductions/ As at As at Deductions/ For the year Impairment As at As at
Adjustments 31-12-09 31-12-08 Adjustments
(See note 2) 31-12-09 31-12-09
Additions/
Adjustments
Rs. Lakhs
As at
31-12-08
Intangible Assets
Goodwill on consolidation 225.44 — — 225.44 — — — — — 225.44 225.44
Tangible Assets
Land freehold 153.86 — — 153.86 — — — — — 153.86 153.86
Land leasehold 14.88 — — 14.88 4.50 — 0.16 — 4.66 10.22 10.38
Buildings 6892.68 299.06 4.91 7186.83 2317.46 1.77 173.46 136.98 2626.13 4560.70 4575.22
Plant, machinery, equipment etc. 29554.46 1091.00 5013.19 25632.27 19020.44 4073.89 1616.23 — 16562.78 9069.49 10534.02
Furniture, fixtures and
office appliances 2278.23 88.57 148.71 2218.09 1629.02 140.79 138.17 — 1626.40 591.69 649.21
Vehicles 696.91 12.31 122.74 586.48 566.65 122.07 37.16 — 481.74 104.74 130.26
Total 39816.46 1490.94 5289.55 36017.85 23538.07 4338.52 1965.18 136.98 21301.71 14716.14
Previous Year 37403.21 3431.26 1018.01 39816.46 21085.88 595.98 2319.55 728.62 23538.07 16278.39
Capital work-in-progress 550.63 1042.32
Advances against capital orders 55.59 30.22
606.22 1072.54
15322.36 17350.93
Notes :
1 Buildings include Rs. 0.12 lakhs (Previous Year : Rs. 0.12 lakhs) being the cost of shares and bonds in co-operative housing societies.
2. In accordance with the provisions of the Accounting Standard 28 on Impairment of Assets notified by the Companies (Accounting Standards) Rules 2006, the Company has identified
certain fixed assets that were impaired mainly on account of economic performance and viability of such assets which does not have any value in use. Accordingly during current year an
impairment loss of Rs. 136.98 lakhs in respect of Dyes and Specialty Chemicals segment (Rs. 12.47 lakhs) and Intermediates and Colours segment (Rs. 124.51 lakhs) has been recognised
in the profit and loss account. (Previous Year Rs. 728.62 lakhs in respect of Intermediates and Colours segment).
SCHEDULE 5 : INVESTMENTS (AT COST) 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Non Trade – Unquoted
Current
In fully paid units of Rs. 10/- each
9825217 (Previous Year : Nil) Birla Sun Life Saving Fund – Daily Dividend 983.19 —
8883589 (Previous Year : Nil) HDFC Treasury Advantage Fund-Whole Sale Fund – Dividend – Daily 891.16 —
4742864 (Previous Year : Nil) HDFC F R I F – STP-Whole Sale Fund – Dividend – Daily 478.12 —
9776175 (Previous Year : Nil) DWS Ultra Short Term Fund – Dividend – Daily 979.37 —
9019717 (Previous Year : Nil) DWS Cash Opportunity Fund – Dividend – Daily 904.16 —
9695701 (Previous Year : Nil) JM Money Manager Fund – Super Plus Plan – Dividend-Daily 970.08 —
4038543 (Previous Year : Nil) IDFC Money Manager Fund – Dividend – Daily 403.91 —
9471776 (Previous Year : Nil) LIC MF Income Plus Fund – Dividend – Daily 947.18 —
9197118 (Previous Year : Nil) LIC MF Saving Plus Fund – Dividend – Daily 919.71 —
9847865 (Previous Year : Nil) LIC MF Floater Fund – Dividend – Daily 984.80 —
Nil (Previous Year : 9346248) Birla Sun Life Short Term Fund – Institutional – Daily Dividend — 935.14
Nil (Previous Year : 7999333) Fidelity Cash Fund-Institutional – Daily Dividend — 800.13
Nil (Previous Year : 7754587) HDFC Liquid Fund Premium Plan – Dividend-Daily — 950.70
Nil (Previous Year : 5571131) Reliance Medium Term Fund – Daily Dividend — 952.41
In fully paid units of Rs. 100/- each
863340 (Previous Year : Nil) ICICI Prudential Flexible Income Premium Plan Fund – Daily Dividend 912.85 —
957923 (Previous Year : Nil) ICICI Prudential Floating Rate Plan D – Daily Dividend 958.12 —
In fully paid units of Rs. 1000/- each
91249 (Previous Year : Nil) Reliance Money Manager Fund – Institutional Plan – Daily Dividend 913.53 —
65341 (Previous Year : 89206) DSP BlackRock Floating Rate Fund – Institutional Plan – Daily Dividend 653.77 892.06
22483 (Previous Year : Nil) UTI Floating Rate Fund STP – Daily Dividend 225.00 —
Nil (Previous Year : 83357) TATA Liquid Super High Investment Fund – Daily Dividend — 929.03
Total Current 12124.95 5459.47
Total Investments – Unquoted 12124.95 5459.47

74 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
SCHEDULE 6 : INVENTORIES 31-12-09
Rs. Lakhs
At lower of cost and net realisable value (As certified by the Management)
31-12-08
Rs. Lakhs
Stores and spare parts 193.82 248.50
Raw materials 2161.07 3340.38
Packing materials 104.65 98.96
Finished goods 4466.55 5740.02
Work-in-progress 838.15 1203.69
7764.24 10631.55
SCHEDULE 7 : SUNDRY DEBTORS 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Secured (Considered good)
Over six months 5.68 9.02
Other debts 1570.88 1349.06
Unsecured (Considered good, unless otherwise stated)
1576.56 1358.08
Over six months (Including doubtful debts Rs. 246.31 lakhs; Previous Year : Rs. 280.89 lakhs) 330.84 396.73
Other debts 12828.06 11745.76
13158.90 12142.49
Less : Provision for doubtful debts 246.31 280.89
14489.15 13219.68
SCHEDULE 8 : CASH AND BANK BALANCES 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
Cash on hand 4.19 6.66
Cheques on hand 49.27 82.05
With scheduled banks :
On current accounts 1027.21 661.74
On fixed deposit accounts 632.34 171.50
1659.55 833.24
1713.01 921.95

Consolidated Schedules
75
SCHEDULE 9 : LOANS AND ADVANCES 31-12-09
Rs. Lakhs
31-12-08
Rs. Lakhs
(Unsecured – considered good, unless otherwise stated)
Advances recoverable in cash or in kind or for value to be received 3526.18 3676.80
Less : Provision for doubtful advances 63.97 —
3462.21 3676.80
VAT set off admissible 104.89 52.51
Advance payment of Income tax (Net of provision for taxation) 1769.39 1648.99
Balances with customs and excise on current account 312.21 317.45
5648.70 5695.75
SCHEDULE 10 : CURRENT LIABILITIES 31-12-09
Rs. Lakhs
Sundry creditors :
31-12-08
Rs. Lakhs
Due to micro enterprises and small enterprises (See Note 7, Schedule 17) 361.14 82.25
Due to others 14168.74 11196.90
14529.88 11279.15
Deposits 1863.03 1443.85
Unpaid dividends* 221.61 160.90
Unclaimed fixed deposits* 0.06 0.15
Unpaid interest on matured fixed deposits* 0.04 0.58
16614.62 12884.63
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund
SCHEDULE 11 : PROVISIONS 31-12-09
Rs. Lakhs
Employee Benefits :
31-12-08
Rs. Lakhs
Leave encashment 365.02 491.71
Gratuity 200.73 387.03
Ex-gratia gratuity 69.21 84.42
Others :
Provision for taxation (Net of advance payment of Income tax) 1270.15 1177.43
Proposed dividend (Final) 3999.11 5065.54
Corporate tax on proposed dividend (Final) 679.65 860.89
6583.87 8067.02

76 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
Schedules
forming part of the Consolidated Profit and Loss Account
SCHEDULE 12 : OTHER INCOME 2009
Rs. Lakhs
2008
Rs. Lakhs
Dividend on current non-trade investments 407.90 171.56
Export incentives 420.13 482.72
Profit on sale of fixed assets (Net) 80.31 9.58
Cash discounts 39.40 36.15
Rental income 398.25 364.66
Indenting commission 589.29 634.52
Profit on sale of current investments (Net) 0.21 0.29
Miscellaneous 727.68 830.78
2663.17 2530.26
SCHEDULE 13 : COST OF MATERIALS 2009
Rs. Lakhs
2008
Rs. Lakhs
Raw materials consumed 38507.15 42091.18
Packing materials consumed 2279.01 2207.08
Purchases of finished goods 12133.72 13003.39
(Increase)/Decrease in stocks of finished goods and work-in-progress :
Opening stock
Finished goods 5740.02 6715.39
Work-in-progress 1203.69 1192.30
Less : Closing stock
6943.71 7907.69
Finished goods 4466.55 5740.02
Work-in-progress 838.15 1203.69
5304.70 6943.71
1639.01 963.98
54558.89 58265.63
SCHEDULE 14 : PERSONNEL COST 2009
Rs. Lakhs
2008
Rs. Lakhs
Salaries, wages, bonus, etc. 4677.67 5256.71
Contribution/Provision for provident fund, superannuation scheme, gratuity fund, etc. 551.95 1028.20
Welfare expenses 929.09 945.00
6158.71 7229.91

Consolidated Schedules
77
SCHEDULE 15 : INTEREST (NET) 2009
Rs. Lakhs
Interest Paid
2008
Rs. Lakhs
Others 100.32 153.38
Less : Interest received (Gross) :
100.32 153.38
Others (Tax deducted at source Rs. 12.69 Lakhs; Previous Year : Rs. 7.71 Lakhs) 83.20 171.67
83.20 171.67
17.12 (18.29)
SCHEDULE 16 : OTHER EXPENDITURE 2009
Rs. Lakhs
2008
Rs. Lakhs
Stores and Spare parts etc. consumed 612.05 606.65
Repairs and maintenance :
Plant and machinery 712.77 896.24
Buildings 218.64 216.51
Others 164.76 187.74
Power and fuel 4595.77 4485.35
Rent (including lease payments) (See note 9, Schedule 17) 555.90 582.10
Rates and taxes (including water charges) 519.90 659.06
Insurance 69.40 110.65
Clearing, forwarding and transport 1337.29 1533.81
Travelling and conveyance 881.57 971.22
Commission 179.83 250.64
Cash discount 11.76 22.37
Other discounts on sales 684.65 1324.79
Assets written-off 100.69 392.98
Provision for doubtful debts/advances (Net) 29.39 200.11
Excise duty (322.38) (374.50)
Exchange loss (Net) 168.57 158.29
Miscellaneous (See note 11, Schedule 17) 3820.14 3813.78
14340.70 16037.79

78 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
Notes to the Consolidated Financial Statements
schedule 17 : Notes on the Consolidated Balance Sheet and Profit and Loss Account for the year ended 31st December, 2009
1. Significant Accounting Policies
BASIS OF PREPARATION
The Consolidated Financial Statements are prepared in accordance with Accounting Standard (AS) 21 on Consolidated Financial Statements
notified by Companies (Accounting Standards) Rules, 2006. The Consolidated Financial Statements comprise the financial statements of Clariant
Chemicals (India) Limited and its subsidiary viz. Chemtreat Composites India Private Limited (voting power-100%). The said Company became
subsidiary on and from February 13, 2006. This subsidiary company is incorporated in India.
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting
notified by the Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of the Companies Act, 1956.
The significant accounting policies are as follows :
I. Revenue Recognition
The Company recognises sale of goods on transfer of significant risks and rewards of ownership of the goods to the buyer. Sales are net
of excise duty, sales tax and trade discounts, wherever applicable.
Dividend income on investments is accounted for when the right to receive the payment is established.
II.
III.
IV.
Excise Duty
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at
the year end.
Excise Duty related to the difference between the closing stock and opening stock of finished goods has been recognised separately in
the profit and loss account under Schedule of ‘Other Expenditure’.
Research and Development
Revenue expenditure on research and development is written off in the profit and loss account in the year in which it is incurred. Capital
expenditure on research and development is treated in the same way as expenditure on fixed assets.
Employee Benefits
(a)
(b)
Short term employee benefit obligations are estimated and provided for.
Post employment benefits and other long term employee benefits:
Defined contribution plans :
Company’s contribution to provident fund, superannuation fund, employee state insurance and other funds are determined under the
relevant schemes and/or statute and charged to revenue.
Defined benefit plans and compensated absences :
Company’s liability towards gratuity, ex-gratia gratuity and compensated absences are actuarially determined at each balance sheet
date using the projected unit credit method. Actuarial gains and losses are recognised in revenue.
V. Voluntary Retirement Scheme
Expenditure incurred on voluntary retirement scheme is charged to revenue in the year in which it is incurred.
VI.
Fixed Assets and Depreciation/Amortisation
(a)
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other
attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed for
acquisition of qualifying assets for the year upto the date the assets are put to use is included in cost.

Notes to the Consolidated Financial Statements
79
(b)
(c)
(d)
(e)
The cost of leasehold land is amortised over the period of the lease.
Intangible assets except Goodwill on consolidation are being amortised equally over a period of three years.
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the
Companies Act, 1956 except for :
(i)
(ii)
certain items of furniture, fixture, air conditioners, plant, machinery and equipment on which a depreciation rate of 20% on
straight line method is applied,
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP equipments
including personal computers and printers on which depreciation rate of 25% on straight line method is applied,
(iii) Motor Cars on which depreciation rate of 25% on straight line method is applied.
Fixed Assets held for disposal are stated at lower of net book value and net realisable value.
VII.
VIII.
IX.
Impairment of Assets
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognised wherever the carrying amount of an asset exceeds its estimated recoverable
amount. The recoverable amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated
future cash flows are discounted to the present value using the weighted average cost of capital. Previously recognised impairment loss
is further provided or reversed depending on changes in circumstances.
Inventories
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories
is generally arrived at on the following basis :
Raw materials, packing materials, trading items and stores and spares – Weighted average cost
Finished goods and work-in-progress – Absorption costing at works cost
Sundry Debtors/Loans and Advances
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.
X. Investments
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated at
the lower of cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.
XI.
XII.
XIII.
Leases
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as
operating leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over the
lease term.
Foreign Currency Translations
(a) Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting
year. In respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward exchange
contract is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation of such a forward
exchange contract is recognised as income or expense for the period. Foreign currency transactions are accounted at the rate
prevailing on the date of transaction.
(b) Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange
rate at the date of transaction.
(c) Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account.
Income Tax
Income-tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax payable
in respect of the estimated taxable income for the year. The deferred tax charge or credit is recognised using prevailing enacted or
substantively enacted tax rates. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only
if there is virtual certainty of realisation of such assets. Other deferred tax assets are recognised only to the extent there is reasonable
certainty of realisation in future. Deferred tax assets/liabilities are reviewed at each Balance Sheet date based on developments during
the year and available case laws, to reassess realisation/liabilities.

80 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
XIV.
Contingencies/Provisions
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources
embodying economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions
except in respect of employee benefits are not discounted to its present value and are determined based on best estimate of the
expenditure required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted
to reflect the current best estimate. A contingent liability is disclosed, unless the possibility of an outflow of resources embodying the
economic benefit is remote.
2. Segment Information for the year ended 31st December, 2009 (As required by Accounting Standard (AS)-17 Segment Reporting) :
(a) The Company is organised into two primary business segments mainly :
(i) Intermediates and Colours :
Includes pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and pharmaceuticals and master batches for
plastics and nylon fibers.
(ii) Dyes and Specialty Chemicals :
Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals.
(b) The secondary segments of the Company are geographical segments mainly :
(i) India
(ii) Outside India
(c)
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the
organisation structure, and the internal financial reporting system.
(d) (i) Segment Revenue and Results :
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.
(ii) Segment assets and liabilities :
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and
inventories. Segment liabilities primarily include creditors and other liabilities.
(iii) Assets and liabilities that cannot be allocated among the segments are shown as a part of unallocable corporate assets and
liabilities respectively.
Information about primary business segments :
Intermediates
&
Colours*
2009
Rs. Lakhs
Dyes and
Specialty
Chemicals
Total
Intermediates
&
Colours *
2008
Rs. Lakhs
Dyes and
Specialty
Chemicals
Revenue (Net)
External Sales/Revenue 39266.95 53165.69 92432.64 40169.07 51854.86 92023.93
Results
Segment Results 8477.04 10758.66 19235.70 4704.42 7040.26 11744.68
Unallocated Corporate Expenses (Net) (917.45) (1270.32)
Operating profits 18318.25 10474.36
Interest Income/Dividend Income 491.10 343.23
Interest Expenses (100.32) (153.38)
Profit before Exceptional Items and Taxation 18709.03 10664.21
Exceptional items (See note 12, Schedule 17) (2450.46) (48.00)
Profit before Taxation After Exceptional Items 16258.57 10616.21
Current Tax/Deferred Tax (5427.34) (3550.26)
Fringe Benefit Tax (39.00) (118.50)
Short provision for taxation in respect of earlier years (30.77) (248.09)
Profit after Tax 10761.46 6699.36
Total

Notes to the Consolidated Financial Statements
81
Information about primary business segments : (Contd.)
Intermediates
&
Colours*
2009
Rs. Lakhs
Dyes and
Specialty
Chemicals
Total
Intermediates
&
Colours *
2008
Rs. Lakhs
Dyes and
Specialty
Chemicals
Other Information
Segment Assets 19429.34 20580.09 40009.43 20989.52 22413.01 43402.53
Unallocated Corporate Assets 16075.93 8227.81
Total Assets 56085.36 51630.34
Segment Liabilities 6597.21 9039.17 15636.38 4585.83 8065.95 12651.78
Unallocated Corporate Liabilities 1817.98 1505.08
Total Liabilities 17454.36 14156.86
Capital Expenditure 668.46 316.36 984.82 1413.84 1240.40 2654.24
Unallocated Corporate Capital Expenditure 14.43 35.20
Total Capital Expenditure 999.25 2689.44
Depreciation/Amortisation 1008.70 887.46 1896.16 1132.43 1100.77 2233.20
Impairment of Fixed Assets 124.51 12.47 136.98 728.62 — 728.62
Unallocated Corporate Depreciation 69.02 86.35
Total Depreciation/Amortisation/Impairment 2102.16 3048.17
Non-cash Expenses other than Depreciation/
Amortisation/Impairment 61.72 63.93 125.65 541.04 298.42 839.46
Unallocated Corporate Non-cash Expenses other than
Depreciation/Amortisation/Impairment 64.28 33.20
Total Non-cash Expenses other than
Depreciation/Amortisation/Impairment 189.93 872.66
Information about Secondary Segments :
2009
Rs. Lakhs
2008
Rs. Lakhs
Total
India Outside India Total India Outside India Total
External Sales 75075.99 17356.65 92432.64 72990.89 19033.04 92023.93
Segment Assets 36364.76 3644.67 40009.43 40417.60 2984.93 43402.53
Additions to Fixed Assets 984.82 — 984.82 2654.24 — 2654.24
Notes :
1 Total assets exclude the following :
(a) Advance payment of income tax Rs. 1769.39 lakhs (Rs. 1648.99 lakhs).
(b) Deferred tax assets (Net) Rs. 275.72 lakhs (Rs. Nil).
2 Total liabilities exclude the following :
(a) Proposed dividend Rs. 3999.11 lakhs (Rs. 5065.54 lakhs).
(b) Corporate tax on proposed dividend Rs. 679.65 lakhs (Rs. 860.89 lakhs).
(c) Provision for taxation Rs. 1270.15 lakhs (Rs. 1177.43 lakhs).
(d) Deferred tax liability (Net) Rs. Nil (Rs. 254.94 lakhs).
* Products hitherto reported under “Masterbatches” segment is now reported under “Intermediates & Colours” segment since the products are
similar in nature.

82 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures” are given below :
Relationship :
(a) Holding Company :
EBITO Chemiebeteiligungen AG, Clariant International AG and Clariant Participations AG, together hold 63.40% equity shares in the
Company, the ultimate holding company being Clariant AG, Switzerland.
(b) Other related parties in the Clariant group where common control exists and with whom the company has transactions :
Fellow Subsidiary Companies :
Clariant (Argentina) SA
Clariant Masterbatches (Italia) S.p.A.
Clariant (Australia) Pty. Ltd.
Clariant Masterbatches (Shanghai) Ltd.
Clariant (Canada) Inc.
Clariant Masterbatches (Thailand) Ltd.
Clariant (China) Ltd.
Clariant Masterbatches Benelux SA
Clariant (Colombia) SA
Clariant Masterbatches Huningue
Clariant (Egypt) SAE
Clariant Masterbatches Ireland Limited
Clariant (Gulf) FZE
Clariant Masterbatches Norden AB
Clariant (Japan) K.K.
Clariant Masterbatches UK Ltd.
Clariant (Korea) Ltd.
Clariant Oil Services UK Ltd.
Clariant (Malaysia) Sdn Bhd
Clariant Pigments (Korea) Ltd.
Clariant (Maroc) S.A.
Clariant Pigments (Tianjin) Ltd.
Clariant (Mexico) S.A. de C.V.
Clariant Prodotti (Italia) S.p.A.
Clariant (Pakistan) Ltd.
Clariant Production (France)
Clariant (Singapore) Pte. Ltd.
Clariant Production UK Ltd.
Clariant (Thailand) Ltd.
Clariant Produkte (Deutschland) GmbH
Clariant (Tianjin) Ltd.
Clariant Produkte (Schweiz) AG
Clariant (Uruguay) SA
Clariant S.A.
Clariant Advanced Materials GmbH
Clariant Southern Africa (Pty.) Ltd.
Clariant Chemicals (China) Ltd.
Clariant Specialty Chemicals (Zhenjiang) Co., Ltd.
Clariant Chemicals (Taiwan) Co., Ltd.
Clariant Specialty Fine Chemicals (France)
Clariant Colorquímica (Chile) Ltda.
Clariant Trading (China) Ltd.
Clariant Corporation
Clariant Venezuela, S.A.
Clariant Distribution UK Ltd.
Dick Peters B.V.
Clariant Distribuzione (Italia) S.p.A.
K. J. Quinn
Clariant Export AG
PT Clariant Indonesia
Clariant Ibérica Producción S.A.
Clariant Life Science Molecules (Florida) Inc.
Clariant Masterbatch Ibérica S.A.
Clariant (Türkiye) Boya ve Kimyevi Maddeler Sanayi ve Ticaret A.S.
Clariant Masterbatches (Deutschland) GmbH
(c) Key Management Personnel :
H. Meier : Vice-Chairman & Managing Director (upto 31.12.2009)
During the year following transactions were entered into with related parties :
(i) Holding Company and Fellow Subsidiaries :
2009
Rs. Lakhs
2008
Rs. Lakhs
Holding Company :
Transactions during the year :
Clariant International AG
Sale of goods 1501.15 1742.65
Purchase of goods 9234.75 7673.84
Services rendered 377.62 324.08
Services received 699.34 644.13
Dividend paid 1761.75 607.50
Expenses recovered 1.51 19.46
EBITO Chemiebeteiligungen AG
Dividend Paid 2368.46 816.71
Clariant Participations AG
Dividend Paid 771.40 266.00
Balances outstanding as at the year end :
Amount payable 1142.51 984.03
Amount receivable 449.12 676.53

Notes to the Consolidated Financial Statements
83
During the year following transactions were entered into with related parties : (Contd.)
(i) Holding Company and Fellow Subsidiaries :
2009
Rs. Lakhs
2008
Rs. Lakhs
Fellow Subsidiaries :
Transactions during the year :
Sale of goods
Clariant Produkte (Deutschland) GmbH 1419.66 2338.86
Clariant Corporation 1239.30 2321.54
Clariant (China) Ltd. 2895.33 1524.41
PT Clariant Indonesia 1170.42 811.89
Others 4474.85 4119.63
Purchase of goods
Clariant (Tianjin) Ltd. 51.95 170.67
Clariant (China) Ltd. 771.38 1008.24
Clariant Corporation 44.82 127.58
Others 486.29 211.87
Purchase of capital goods
Clariant Masterbatches (Deutschland) GmbH 5.27 170.08
Clariant Masterbatches (Italia) S.p.A. 10.00 23.34
Clariant Production UK Ltd. 2.97 —
Sale of capital goods
Clariant Produkte (Deutschland) GmbH 50.47 —
Services rendered and others
Clariant Export AG 308.38 283.67
Clariant Produkte (Deutschland) GmbH 0.54 70.55
Others 40.52 44.70
Expenses recovered
Clariant Produkte (Deutschland) GmbH — 4.49
PT Clariant Indonesia 0.22 —
Clariant (Singapore) Pte. Ltd. 0.05 —
Others — 0.78
Services received and others
PT Clariant Indonesia 18.49 8.19
Clariant (Singapore) Pte. Ltd. 20.67 29.65
Clariant Southern Africa (Pty.) Ltd. 27.35 8.86
Clariant Produkte (Deutschland) GmbH — 8.93
Clariant S.A. — 10.51
Clariant (Gulf) FZE 11.37 2.77
Others 16.55 17.83
Expenses reimbursed
PT Clariant Indonesia 0.76 —
Clariant (Malaysia) Sdn Bhd 1.63 —
Balances outstanding as at the year end
Amount payable 424.20 520.37
Amount receivable 2476.97 1450.59
(ii) Key Management Personnel :
Remuneration 217.09 164.97
Payable balance 67.58 26.75

84 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
4. Contingent liabilities not provided for :
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
I. (a) in respect of income tax matters
decided against the Company, in respect of which the Company is in further appeal 1458.40 856.16
II.
decided in favour of the Company against which the department is in appeal 14.78 14.78
(b) in respect of sales tax matters 578.58 494.22
(c) in respect of excise matters 448.03 455.66
(d) in respect of bills of exchange discounted with banks
1119.58 29.60
[since realised Rs. 783.61 lakhs (Rs.17.73 lakhs)]
(e) Other matters in dispute 2.25 2.25
(f) Disputed labour matters – Amount not ascertained.
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is determinable only on receipt of judgements
pending at various forums/authorities.
On 15th February 2005, the Company had received an order of the Tahsildar, Thane demanding Rs.120.70 lakhs for the lease of land to
Thane Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against
which the Company had filed a writ petition on 23rd February 2005 before the Bombay High Court. The Hon’ble High Court has granted
interim stay in terms of the petition on 14th July 2005.
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
5. Estimated amount of contracts remaining to be executed on capital account and not
provided for 179.15 201.56
6. Deferred taxes :
The major components of deferred tax assets and deferred tax liabilities are set out below :
31-12-2009
Rs. Lakhs
31-12-2008
Rs. Lakhs
Deferred tax assets
(a) Provision for doubtful debts 105.50 95.50
(b) Provision for retirement benefits 215.89 327.47
(c) Expenses allowable for tax purposes when paid 53.54 53.54
(d) Integration expenses 15.74 78.70
(e) Payment/Provision for voluntary retirement scheme 1184.64 552.46
(f) Others — 1.23
1575.31 1108.90
Deferred tax liabilities
Depreciation/Amortisation/Impairment (1299.59) (1363.84)
Deferred Tax assets/(liabilities) – Net 275.72 (254.94)
7. Amount paid/payable by the Company to Directors (including Managing Director) as remuneration for services rendered in any
capacity :
2009
Rs. Lakhs
2008
Rs. Lakhs
Directors’ sitting fees 1.45 0.90
Salaries 137.76 136.17
Commission 36.75 34.75*
Compensation for loss of office 40.83 —
Provident fund 11.35 1.89
Other perquisites and benefits in cash or in kind 0.40 0.16
228.54 173.87
* Actual paid during the Year Rs. 25.49 lakhs and Rs. 9.26 lakhs reversed during the year.

Notes to the Consolidated Financial Statements
85
8. Earnings Per Share :
2009
Rs. Lakhs
2008
Rs. Lakhs
(a) Net profit after taxation 10761.46 6699.36
(b) Number of equity shares outstanding 26660745 26660745
(c) Basic and Diluted earnings per share (Rupees) 40.36 25.13
(d) Face value per share (Rupees) 10.00 10.00
9. Assets taken on lease on or after 1st April, 2001 :
(a)
(b)
(c)
(d)
2009
Rs. Lakhs
2008
Rs. Lakhs
In respect of operating leases, where lease agreements have been formally entered into,
lease payments recognised in the profit and loss account for the year are as follows.
Office premises, vehicles and computers 382.43 377.91
There are no restrictions such as those concerning dividends, additional debt and further
leasing, imposed by the lease agreements entered into by the Company.
Contingent rent payments in respect of vehicles are dependent upon the excess of actual
usage, if any, over stipulated usage.
The total of future minimum lease payments under non-cancellable operating leases are
as follows :
For a period not later than one year 285.05 326.65
For a period later than one year and not later than five years 254.37 343.68
Total 539.42 670.33
10. Expenditure on Research and Development :
2009
Rs. Lakhs
2008
Rs. Lakhs
(a) Capital expenditure 3.36 9.93
(b) Revenue expenditure charged to profit and loss account 224.20 323.29
227.56 333.22
11. Miscellaneous Expenses in Schedule 16 : Other expenditure include :
Auditors’ remuneration and expenses : (Excluding Service tax)
2009
Rs. Lakhs
2008
Rs. Lakhs
(a) Audit fees 25.00 25.00
(b) Company law matters 0.15 —
(c) Taxation services 0.23 —
(d) Other services 31.20 37.50
(e) Out-of-pocket expenses 0.45 0.11
57.03 62.61
12. Exceptional items in Profit & Loss Account include :
2009
Rs. Lakhs
2008
Rs. Lakhs
Termination benefits to Employees 2810.46 48.00
Income from sale of flexible laminating adhesives business (360.00) —
2450.46 48.00

86 Clariant Chemicals (India) Limited — Consolidated
Annual Report 2009
13. Employee Benefits :
2009
Rs. Lakhs
2008
Rs. Lakhs
Funded Unfunded Funded Unfunded
(a) Defined benefit Plans – As per Actuarial valuation as on December 31, 2009 :
Gratuity
(i) Expenses recognised in the statement of Profit and Loss Account for the year
1. Current Service Cost 181.10 4.17 190.63 4.36
2. Interest Cost 178.36 6.86 142.81 6.01
3. Expected return on Plan Assets (204.25) — (194.58) —
4. Net acturial (Gain)/Loss recognised during the year (133.86) 4.54 234.40 (5.81)
5. Expense/(Income) recognised in Profit & Loss Account 21.35 15.57 373.26 4.56
[Gratuity expense/(income) have been recognised in Contribution/Provision for
provident fund, superannuation scheme, gratuity fund etc. in “Personnel Cost”
under Schedule 14]
(ii) Actual return on Plan Assets for the year
1. Expected return on Plan Assets 204.25 — 194.58 —
2. Actuarial Gain/(Loss) on Plan Assets (38.87) — 39.51 —
3. Actual return on Plan Assets 165.38 — 234.09 —
(iii) Net Asset/(Liability) recognised in the Balance Sheet as at the year end
1. Present Value of the Defined Benefit Obligation 2342.20 69.21 2940.12 84.42
2. Fair Value of Plan Assets 2141.47 — 2553.09 —
3. Net Asset/(Liability) recognised in the Balance Sheet (200.73) (69.21) (387.03) (84.42)
(iv) Change in Defined Benefit Obligation during the year
1. Present Value of Obligation at the beginning of the year 2940.12 84.42 2551.45 80.18
2. Current Service Cost 181.10 4.17 190.63 4.36
3. Interest Cost 178.36 6.86 142.81 6.01
4. Benefits Paid (784.65) (30.78) (218.68) (0.32)
5. Actuarial (Gain)/Loss on obligation (172.73) 4.54 273.91 (5.81)
6. Present Value of Obligation as at the end of the year 2342.20 69.21 2940.12 84.42
(v) Changes in fair value of Plan Asset during the year
1. Fair Value of Plan Assets as at the beginning of the year 2553.09 — 2432.22 —
2. Expected return on Plan Assets 204.25 — 194.58 —
3. Contributions made 207.65 — 105.46 —
4. Benefits paid (784.65) — (218.68) —
5. Actuarial Gain/(Loss) on Plan Assets (38.87) — 39.51 —
6. Fair value of Plan Assets as at the end of the year 2141.47 — 2553.09 —
(vi) Major categories of Plan Assets as a percentage of Total Plan Assets
1. Central Government Securities 29.64% — 24.84% —
2. State Government Securities 12.32% — 10.03% —
3. Private Sector Bonds 20.90% — 15.21% —
4. Special Deposit Scheme 25.54% — 21.69% —
5. Cash at Bank 1.15% — 1.10% —
6. Investment in Insurance Companies 22.06% — 22.67% —
7. Others (11.61%) — 4.46% —
(vii) Actuarial Assumptions
1. Discount Rate 8.0% 8.0% 7.0% 7.0%
2. Expected Rate of return on Plan Assets 8.0% — 8.0% —
3. Salary Escalation 4.0%-6.0% 4.0%-6.0% 4.0%-6.0% 4.0%-6.0%
(viii) Experience Adjustments
1. Experience Adjustments on Plan Assets (38.87) — — —
2. Experience Adjustments on Plan Liabilities (49.77) 4.54 — —

Notes to the Consolidated Financial Statements
87
13. Employee Benefits : (Contd.)
(a)
(b)
(c)
(d)
(e)
(f)
2009
Rs. Lakhs
2008
Rs. Lakhs
Defined benefit Plans – As per Actuarial valuation as on December 31, 2009 : (Contd.)
Other Long Term Benefits
The Defined Benefit obligations which are provided for but not funded are as under:
Compensated Absence/Leave Salary 365.02 491.71
Gratuity is administered through duly constituted and approved independent trusts and
also through Group gratuity scheme with Life Insurance Corporation of India
Future salary increases considered in acturial valuation take in to account inflation,
seniority, promotion and other relevant factors, such as supply and demand in the
employment market
Basis used to determine expected rate of return on plan assets:
The expected rate of return on plan assets is based on market expectation, at the
beginning of the year, for returns over the entire life of the related obligation.
Accounting standard 15 (Revised 2005) “Employee Benefits” requires the disclosure of
experience adjustments for past four years, however, the information is given only for
the current year.
During the year the Company has recognised the following amounts in the Profit & Loss
Account in Schedule 14 :
Salaries, wages, bonus etc. includes compensated absences 49.17 93.02
Contribution/Provision for provident fund, superannuation scheme, gratuity fund etc.
includes :
Provident Fund & Family Pension 275.30 278.81
Superannuation Fund 239.24 370.57
Gratuity Fund 36.92 377.82
Other Funds 0.49 1.00
14. The Company has entered into an agreement with Laxmi Organic Industries Ltd. on May 15, 2009 for the sale of its business of Diketene and
downstream intermediate products together with removable plant and equipment. On receipt of full consideration, the transaction has been
concluded in January 2010.
15. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.
16. The figures in brackets are those in respect of the previous accounting year.
For and on behalf of the Board
R. A. Shah Chairman
P. Palm Vice-Chairman & Managing Director
Diwan A. Nanda Director
B. L. Gaggar Director Finance & Company Secretary
Mumbai, 19th February, 2010

88 Clariant Chemicals (India) Limited
Annual Report 2009
Financial Performance
10 Years‘ Highlights
(Rs. Million)
Financial Year Ended 31st December
Financial Year Ended 31st March
2009 2008 2007 ****2006 ***2006 2005 2004 2003 2002 2001
I. OPERATING RESULT
Gross Sales 9732.2 10014.5 9517.1 7538.9 9246.5 4035.2 4083.4 3821.7 3310.1 3301.9
Net Sales 9213.4 9163.9 8614.4 6870.4 8479.1 3656.1 3746.8 3492.8 2990.1 2991.8
Gross Earnings Before Depreciation/
Impairment and Taxation +2079.4 +1375.7 +1021.3 +655.7 893.1 472.5 380.0 343.7 273.0 236.8
Profit Before Taxation #1631.1 #1072.9 #493.3 #507.8 648.4 *357.8 249.5 214.7 141.6 114.8
Profit After Taxation 1081.4 674.8 317.9 328.7 403.9 155.9 335.7 149.7 90.6 89.8
Equity Dividend 666.5 506.6 266.6 479.9 293.3 69.9 69.9 69.9 58.3 46.6
II.
FINANCIAL POSITION
Gross Fixed Assets 3556.6 3985.1 3819.6 3831.7 3850.2 2105.6 1934.0 1973.8 1930.3 1912.7
Net Fixed Assets 1527.3 1646.0 1719.1 1651.8 1601.6 837.2 737.7 804.8 862.9 935.0
Investments 1245.0 578.4 294.3 465.0 1132.6 464.5 204.5 85.0 85.0 87.4
Net Current Assets 698.5 1008.3 1164.8 1128.2 1198.7 743.5 741.5 843.3 982.1 1017.2
Equity 266.6 266.6 266.6 266.6 **266.6 116.5 116.5 116.5 116.5 116.5
Reserves 3211.3 2909.8 2827.6 2835.8 3054.4 1605.7 1529.6 1272.7 1200.6 1303.9
Shareholders' Fund 3477.9 3176.4 3094.2 3102.4 3321.0 1722.2 1646.1 1389.2 1317.1 1420.4
Loans and Deferred Payment Credits 20.5 30.9 40.7 62.1 559.4 339.4 110.4 236.4 474.0 619.2
Capital Employed 3498.4 3207.3 3134.9 3164.5 3880.4 2061.6 1756.5 1625.6 1791.1 2039.6
III.
PER EQUITY SHARE
Earnings (Rupees) #40.56 #25.31 #11.92 #12.33
(Not
Annualised)
15.15 13.30 28.82 12.96 7.97 7.45
Dividend 25 19 10 18 11 6 6 6 5 4
# After exceptional items
+ Before exceptional items
* Before prior period items
** Including share capital suspense account
*** In view of the amalgamation w.e.f. April 1, 2005, the figures of the year 2006 are not directly comparable to those of earlier years.
**** Figures are for nine months ended December 31, 2006

www.clariant.in
Clariant Chemicals (India) Limited
Ravindra Annexe
194 Churchgate Reclamation
Mumbai 400 020