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DIRECTORS’ REPORT

TO THE MEMBERS 5. FINANCE


TATA MOTORS FINANCE LIMITED
MOT The year had witnessed an unprecedented liquidity crunch in the market
and this was more prominent during the third quarter of the year. Many
The Directors present their Third Annual Report and the Audited Statement of NBFC's significantly slowed down or even stopped their financing activity.
Accounts for the year ended March 31, 2009.
In spite of these conditions, the Company had managed to secure the credit
1. FINANCIAL RESULTS
RESULT (Rs in crore) lines from the banks and availability of funds did not impact its financing
business, though the cost of funds was higher.
2008-09 2007-08
Total Income 919.94 834.36 The Company sourced its funds through combination of bank borrowings
and Commercial Paper (CP). As on March 31, 2009 total sanctioned bank
Less: Finance Costs 460.25 432.66 limits were Rs.5481 crore of which the Company had utilised Rs.4155 crore.
Expenditure 613.91 346.41 While the Company could not issue a significant quantum of Commercial
Depreciation / Amortization 7.70 5.03 Papers(CP) in the quarter October to December, 2008 on account of tight
money markets, during the year it issued CP's of varying tenors, aggregating
Profit/ (Loss) Before Tax (161.92) 50.26 Rs.1795 crore of which it had outstanding CP's of Rs.275 crore as on March 31,
Less: Provision For Tax 2009. Additionally, Bank Guarantee lines of Rs 750 crore were also set up
Current Tax including Fringe Benefit Tax 34.11 19.30 during the year
Deferred tax (75.32) (13.81) Subsequent to the downgrading of the Company's short-term rating from
Profit/ (Loss) After Tax (120.71) 44.77 A1+ to A1 by ICRA (a fallout of similar downgrading in the parent Company
- Tata Motors Ltd), the CP market was no longer accessible to the Company
Balance brought forward from previous year 46.05 10.23 as there were no investors for A1 rated paper. This led to a significant increase
Amount Available for Appropriations - 55.00 in the overall cost of funds.
APPR OPRIA
APPROPRIA TIONS
OPRIATIONS 6. CREDIT R
RAATING
General Reserve The Company's short term borrowing program of Rs.3500 crore was rated A1
Special Reserve - 8.95 (highest credit quality rating) by ICRA. The Company's outstanding
Surplus carried to Balance Sheet (74.66) 46.05 debentures of Rs 617.20 crore were downgraded from a rating of AA+
(indicates high degree of safety with regard to timely payment of interest
The Company is registered with RBI under Section 45-IA of the RBI Act 1934, and principal) to A/stable (indicates adequate degree of safety with regard
as a Systematically Important Non-Deposit taking Non- Banking Finance to timely payment of interest and principal) by CRISIL and from LAA+ (high
Company (NBFC) and has been classified as an Asset Finance Company. credit quality rating) to LA+ (adequate credit quality rating) by ICRA.
2. DIVIDEND The rating revision is on account of a similar downgrade for the holding
company, Tata Motors Limited.
In view of the loss during the year under review, the Board of Directors has
not recommended any dividend (previous period Rs. Nil). 7. SECURITISATION
SECURITISATION
3. NBFC REGISTR
REGISTRAATION During the year, the Company securitized gross receivables aggregating to
Rs.3981 crore (previous year Rs.5246 crore) by way of direct assignment to
The Reserve Bank of India (RBI) had granted to the Company a provisional banks and to Special Purpose Vehicles (SPVs) which could pass through
certificate of registration under Section 45-IA of the RBI Act, 1934, for a period certificates to investors. These receivables were rated AAA (so) (highest
of two years. In order to assess the eligibility for continuation of the registration degree of certainty regarding fulfillment of obligation) by CRISIL.
granted, a review of the company's level of compliances as per RBI guidelines
and financial performance was conducted during the year. Consequent to 8. SHARE C APIT
CAPIT AL
APITAL
the same and being satisfied with the information and particulars provided The Company is a wholly owned subsidiary of Tata Motors Limited ( TML).
by the Company to it, the RBI has regularised the certificate of registration During the year the Company allotted an additional 10 crores Equity Shares
granted to the Company. of Rs.10/- each at a premium of Rs.10/- aggregating to Rs.200 crore, to TML.
4. OPER
OPERAATIONS Consequently, as at March 31, 2009, the paid-up Share Capital of the Company
increased to Rs.850 crore from Rs.750 crore as on March 31, 2008.
The performance of the Company needs to be viewed against the backdrop
of a very difficult year for the world economy in general which also had its 9. HUMAN RESOURCES
effect in creating an unfavorable business sentiment in India. The automotive The Company has initiated a culture that is open, transparent and performance
industry, which was amongst the most adversely affected, experienced a oriented. Towards meeting this end, the key focus HR areas during the year
dip in demand and resulted in a decline in volumes for Tata Motors which were execution of online performance measurement system, enhanced
led to decline in the Company's performance. Tight money markets coupled communication with employees through different forums, getting talented
with poor repayment capacity of fleet owners and individual buyers alike resources in the organization to support its growth plans and employee
led to an increase in Non Performing Assets (NPA). The NPA's coupled with engagement initiatives. There has also been significant emphasis on
higher interest cost have severely impacted the operations of the Company implementation of HR related systems and processes by stabilizing and
leading to a loss of Rs.120.71 crore (previous year - Profit of Rs.44.77 crore). updating employee related data which has been linked to a central system.
Total disbursements by the Company for new Commercial Vehicles during Employee development has been taken care of through various training and
the year under review were Rs.5,206 crore (94,882 units) as compared to development activities keeping in mind required skill sets and functional
Rs.6,300 crore (1,07,668 units) during the previous year. For Passenger Cars, needs.
total disbursements were Rs.1,807 crore (58,125 units) as compared to Rs. In FY '09 while the industry's attrition rate was around 20%, the Company
2,228 crore (69,769 units) in the previous year. could hold its attrition at about 12% by providing employees job enriching
The market share for Commercial Vehicles was at 36% as compared to 34% assignments, rotations and higher responsibilities throughout the year.
in 2007-08 and the market share of Passenger Cars and Utility Vehicles was The Company had 690 employees on its rolls as on March 31, 2009.
29% as compared to 32% in 2007-08.
10. COMPLIANCE
For the year under review, 'Tata Motorfinance' financed a total 1,53,007 new
commercial and passenger vehicles (1,77,437 units during 2007-08), with a The Company has complied with all the applicable laws and regulations
market share of 33% (34% during 2007-08) and total disbursals aggregating including those of the Reserve Bank of India. The Company is also compliant
to Rs. 7,415 crore (Rs. 9,620 crore during 2007-08). with all applicable laws for its branch, regional and corporate offices.
The Company had to account for provisions from NPA and Write-offs of 11. DEPOSITS
Rs. 321.52 crore (previous year Rs. 73.91 crore). A significant portion of this The Company has not accepted any public deposits during the year under
was due to loss on sale of its assets arising from disposal of repossessed review.
vehicles a portion of which had been in stock for several months. The Company
has reduced the stock of its repossessed assets from a level of 16000 units to 12. ACCOUNT
OUNTSS AND A
ACCCOUNTING STANDARDS
STANDARDS
9600 units at the end of the year. Efforts are ongoing to recover the losses The Company adheres to the prudential guidelines prescribed by the Reserve
from their original borrowers. The Company has also put in place certain Bank of India and to the Accounting Standards issued by the Institute of
measures to improve realization on its repossessed stock which are expected Chartered Accountants of India in preparation of its financial statements.
to arrest to some extent the large losses that it has had to incur on sale of such
assets. The particulars on related party exposures, non-performing assets and business
levels in lease and hire purchase and other activities, required to be disclosed
For the FY'10, company has instituted several measures to improve its bottom- in the format prescribed by the RBI are contained in the Schedule forming
line by improving the management of NPAs. There are dedicated teams in part of the accounts.
place to micro manage the collection efforts from the first point of default.
The Company is also using advanced analytics to identify the potential NPAs 13. CONSER
ONSERVVATION OF ENER GY
GY,, TECHNOL
ENERGY OGY ABSORPTION AND FOREIGN
TECHNOLOGY
early in life cycle and take pro-active steps to control these contracts from EXCHANGE EARNINGS AND OUTGO
flowing into NPA. All of these initiatives involve the Sales, Credit, Risk teams In view of the nature of activities which are being carried out by the Company,
along with Collections for greater effectiveness. In addition, several initiatives Rules 2A and 2B of the Companies (Disclosure of Particulars in the Report of
have been taken to improve margins and operating efficiencies. These steps Board of Directors) Rules, 1988, concerning conservation of energy and
should help the Company substantially improve its revenue and profitability.

1
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

technology absorption, are not applicable to the Company. During the year Statutory Auditors and the Dy. Company Secretary. The Internal Audit
the Company did not have any earnings in foreign exchange (previous year function is headed by the Chief Internal Auditor of Tata Motors Ltd., who
nil) and had an outgo of Rs. 0.01 crore in foreign exchange transactions reports to the Audit Committee. The minutes of the Audit Committee
(previous year Rs.0.05 crore). meetings form part of the Board papers circulated for Board Meetings.
14. DIRECTORS The Chairman of the Audit Committee briefs the Board members about
significant discussions at Audit Committee meetings.
In accordance with the requirements of the Companies Act, 1956 and the
e. The Company has signed an agreement (BE-BP Agreement) with Tata
Articles of Association of the Company, Mr. Hoshang Sinor and Mr. Bharat
Sons Limited subscribing to the TATA Brand Equity and Business
Vasani are liable to retire by rotation at this Annual General Meeting and are
Promotion Scheme. The Company abides by the Tata Code of Conduct
eligible for re -appointment.
and norms for new Tata brand identity.
Mr. V R Mehta retired as per the policy for Retirement Age of Non-Executive
f. As a good corporate governance practice, the Company is adopting
Directors adopted by the Company. Mr. Mehta had been on the Board for
quarterly audited accounts.
more than 2 years and was the Chairman of its Audit Committee and Risk
Management Committee and a member of the Asset Liability Supervisory g. During the period under review, besides the transactions mentioned
Committee, Remuneration Committee and Nominations Committee. Mr. elsewhere in the Annual Report, there were no other related party
Mehta had, by his counsel and guidance, significantly contributed to transactions by the Company.
deliberation at Board and Committee meetings. The Board places on record h. The Company follows Accounting Standards issued by the Institute of
the valuable contribution made by Mr. V. R. Mehta during his tenure as a Chartered Accountants of India and in the preparation of financial
member of the Board and its Committees. statements, the Company has not adopted a treatment different from
15. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY that prescribed in any Accounting Standard.
The Company has adequate internal control systems to ensure operational i. The Board adopted the Whistle-Blower Policy which provides a formal
efficiency, protection and conservation of resources, accuracy and mechanism for all employees of the Company to approach the
promptness in financial reporting and compliance of laws and regulations. Management/ Audit Committee and make protective disclosures to
The internal control system is supported by the internal audit process. The the Management about unethical behaviour, actual or suspected fraud
Company's audit of its controls and system and processes is undertaken or violation of the Company's Code of Conduct or ethics policy. The
through the Internal Audit Function of its holding company, Tata Motors disclosures reported are addressed in the manner and within the time
Limited. The Internal Audit monitors the adequacy and efficacy of the frames prescribed in the Policy. No employee of the Company has been
Company's internal controls including its systems and processes and denied access to the Audit Committee.
compliance with regulations and procedures. The reports are discussed and j. The 'Asset Liability Supervisory Committee' of Directors oversees the
reviewed with the Managing Director and recommendations made are implementation of the Asset Liability Management system and
adopted by the management. periodically reviews its functioning. The 'Asset Liability Committee'
The Internal Audit Department of Tata Motors Limited reviews and ensures comprising of senior executives constituted to carry out the necessary
that the audit observations are acted upon. The Audit Committee of the spade work for formalizing the ALM system in the Company reports to
Board reviews the Internal Audit reports and the adequacy and effectiveness the Asset Liability Supervisory Committee of Directors.
of its internal controls. The Company's internal controls and audit comments k. The "Risk Management Committee' of Directors manages the integrated
are also separately reviewed by the Audit Committee of Tata Motors Limited. risks of the Company.
16. RISK AND CONCERNS
l. The "Nomination Committee" of Directors had been constituted to ensure
The Company recognizes the importance of risk management on account of appointment of directors with 'fit and proper' credentials. The
increased competition and market volatility in financial services business. Company lays great emphasis on risk management, primarily in the
The Company is exposed to credit risk, operational risk, liquidity risk arising areas of risk, interest rate and liquidity risk and operational risk.
from mismatch of tenor of funds borrowed and loaned, and interest rate risk. 18. AUDITORS
By design, the Company caters to high risk profile customers. To ensure that
it can manage its operational and credit risk, the Company has a well- M/s. Deloitte Haskins & Sells (DHS), who are the Statutory Auditors of the
developed and robust credit appraisal process which is amended, as Company hold office until the ensuing Annual General Meeting. It is proposed
required, to address any regulatory changes in the financial sector. Well to re-appoint them to examine and audit the accounts of the Company for the
defined norms and approval escalation processes are in place for approving Financial Year 2009-10. DHS have, under Section 224(1) of the Companies Act,
credit. The Company also has in place a mechanism to price the risk through 1956, furnished a certificate of their eligibility for re-appointment.
a risk scoring model. 19. PAR TICUL
ARTICUL ARS OF EMPL
TICULARS O YEES
EMPLO
The Company also faces risks from factors like increased competition, Information in accordance with sub-section (2A) of Section 217 of the Companies
economic slowdown, challenge of retaining manpower, likely decline in asset Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, and
quality, increase in operating costs, RBI provisioning policies etc. The Company forming part of the Directors' Report for the period ended March 31, 2009, is
has in place suitable mechanisms to effectively reduce such risks. All these given as an Annexure to this Report.
risks are continuously analyzed and reviewed through an effective information
system. 20. DIRECT ORS' RESPONSIBILIT
DIRECTORS' RESPONSIBILITYY STATEMENT
STA
The Board of Directors has set up an 'Asset Liability Supervisory Committee' Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors, based
of Directors to closely monitor mismatches of Asset and Liabilities as well as on the representations received from the Operating Management, confirm
the 'Risk Management Committee' of Directors that oversees the that:-
management of the integrated risks of the Company. i. in the preparation of the annual accounts, the applicable accounting
17. CORPOR
ORPORAATE GOVERNANCE standards have been followed and there are no material departures;
a. The Company recognizes its role as a corporate citizen and endeavors ii. they have, in the selection of the accounting policies, consulted the
to adopt the best practices and the highest standards of Corporate Statutory Auditors and have applied them consistently and made
Governance though transparency in business ethics, accountability to judgments and estimates that are reasonable and prudent so as to give
its customers, government and others. a true and fair view of the state of affairs of the Company at the end of
the financial year and of the loss of the Company for that period;
b. The day to day management of the Company is in the hands of the
Managing Director who is assisted by a team of senior professionals. iii. they have taken proper and sufficient care, to the best of their knowledge
The Managing Director functions under the overall superintendence of and ability, for the maintenance of adequate accounting records in
the Board. The Board has constituted the following Committees:- accordance with the provisions of the Companies Act, 1956, for
safeguarding the assets of the Company and for preventing and detecting
- Audit Committee frauds and other irregularities;
- Risk Management Committee iv. they have prepared the annual accounts on a going concern basis.
- Asset Liability Supervisory Committee 21. ACKNOWLEDGEMENTS
- Remuneration Committee The Directors would like to place on record their gratitude for the valuable
- Nominations Committee guidance and support received from the Reserve Bank of India and other
Government and regulatory agencies and to convey their appreciation to
c. The Board comprises of Mr. Praveen P Kadle, Chairman, Mr. H N Sinor,
Tata Motors Limited, dealers of Tata Motors Limited, its other customers,
Mr. Bharat Vasani, Mr. Rajiv Dube, Mr.C Ramakrishnan, Non - Executive
bankers, lenders, vendors and all other business associates for the continuous
Directors and Mr.Shyam Mani- Managing Director. During the year under
support given by them to the Company. The Directors also place on record
review, six meetings were held on April 29, 2008; May 20, 2008; July 22,
their appreciation of all its employees for their commendable efforts, team
2008; October 20, 2008; January 21, 2009 and March 20, 2009.
work and professionalism.
d. The Audit Committee, re-constituted on May 18, 2009, consequent to
retirement of Mr.V R Mehta, comprises of Mr.Praveen P Kadle ,
Chairman, Mr. Bharat Vasani and Mr.C Ramakrishnan. During the year On behalf of the Board of Directors
under review, eight meetings were held on on April 29, 2008; May 20,
2008; July 10, 2008; July 22, 2008; October 7, 2008; October 20, 2008; Praveen P Kadle
January 21, 2009 and March 20, 2009. The Audit Committee meetings Chairman
are attended by the Chief Financial Officer, the Internal Auditor, the Mumbai, May 18, 2009

2
ANNEXURE TO DIRECTORS’ REPORT
Information as per Section 217(2A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975 and forming part of the Directors’ Report
for the year ended March 31, 2009
Sr. N a m e A g e Designation / Gross Net Qualifications E x p e r - Date of Last Employment
No. ( Y r s ) nature of duties Remun- Remun- ience Joining
eration eration ( Ye a r s )
Rs. Rs.
1 A CHATTERJEE 56 Deputy Vice President - Special Projects 3210800 2138322 Dip. In Mech Engg 38 1-Apr-71 Tata Motors Limited
2 ADARSH KUMAR 39 Chief - Commercial Vehicle Finance 5026478 3636525 BA.,PGDBM 15 14-Mar-08 Bajaj Auto Finance Limited
3 AJAY PHERWANI 40 CIO - eNxt 5144399 3437443 BE(Elect&Electro) 18 1-Aug-90 Tata Technologies Limited
4 ALOK CHADHA 46 Regional Business Head - Western Region 2405380 1648827 B.Com., PGDBM 26 4-Feb-08 Chrysallis Financial
Services Pvt. Ltd
5 ANIL RATHI * 38 Deputy Vice President - Credit 2047184 1429136 B.E. MMS 16 14-Jul-08 ICICI Bank Limited
6 C N NANDKUMAR 45 Associste Vice President - Accounts 2421872 1615947 B.Com, ICWA 25 16-Mar-92 SM Finance Limited
7 CHANDRAMOHAN B AMRITKAR 39 Deputy Vice President - Treasury 3248013 2182163 B.E., MBA 15 6-Oct-06 Essar Group
8 DEEPABH JAIN * 41 Chief Operating Officer 5788052 3939086 B.E., MBA 18 22-Sep-08 HSBC
9 DONALD A MADTHA 43 Country Manager, PC Collections 2995228 2177931 B.Com., DMM 20 4-Jan-07 ICICI Bank Limited
10 GAGAN CHHABRA 35 Regional Sales Manager CV (East) 2486299 1784282 B.Sc., PGDBM 12 31-May-05 ICICI Bank Limited
11 GAUTAM BOSE 38 Head - Legal Remedial 3051768 2219197 B.Com 14 16-Oct-06 ICICI Bank Limited
12 GURURAJ GADAGKAR 55 Deputy Vice President - Operations 3854694 2535012 B.Com., DBM 28 28-Sep-92 SM Dyechem Group of Industries
13 HARI SIVARAMAN 40 Regional Business Head (South) 4332418 3061441 B.Com 16 28-Nov-05 ICICI Bank Limited
14 JAYANT CHITALE * 44 Chief - Commercial Vehicle Finance 2113280 1521283 BE (Mach) 23 14-Aug-06 Eicher Motors Limited
15 JITENDRA JADHWANI7 43 Chief - IT , TMF 4317895 2938643 B E . PG Dip In 21 4-May-95 Research and Training Institute
Software, CFA
16 K GIRISH JANARDANAN 47 Regional Manager - PC Finance (West) 3009138 2061315 BSc., MBA 25 29-Apr-04 Tata Motors Limited
17 KAMLESH PARIKH * 53 Chief - Legal 1829166 1223173 B.Sc., LLB., CAIIB 32 1-Jul-98 Central Bank of India
18 KARIMI MANTRI * 40 Deputy Vice President - Admimistration 1189359 985727 BE(Civil), MCM 18 3-Nov-08 HDFC Bank Limited
19 KEVAL KRISHAN SHARMA 45 Regional Business Head - Northern Region 4055733 2644611 M.Sc., PGDBM 23 21-Dec-07 Maruti Suzuki India Limited
20 MONAL SRIVASTAVA * 33 Head - HR & Administration 1070388 815454 B.Sc., PGDM 10 11-Aug-03 Tata Motors Limited
21 NEETA SHAH 43 Deputy Vice President - Customer Support 2427950 1701161 B.Com., CA 19 18-Sep-95 Tata Motors Limited
22 PARAS N JHA 35 Regional Business Head (East) 4363212 2938691 B.Sc., MBA 13 31-Aug-95 Tata Motors Limited
23 PAVAN TRIVEDI 38 Chief Financial Officer 2949014 1974869 B.Com., CA., ICWA 13 1-Feb-08 Reliance Communication Limited.
24 PRADEEP KUMAR 34 Head - Risk Containment 2879500 2123568 B.Sc., PGDBM., CFE 9 2-Jul-07 ICICI Bank Limited
25 PRASHANT SAWANT 40 Deputy Vice President - Operations 2728396 1918002 B.Com., ICWA (Inter) 16 7-Aug-06 ICICI Bank Limited
26 R BALASUBRAMANIAN 52 Vice President - Special Projects 3101027 2086254 B.Sc., B.Tech 29 6-May-80 Tata Motors Limited
27 R VAITHIANATHAN * 55 Chief - Operations & Dealer Credit 4405192 2875595 B.Sc., ACA, ICWA 31 4-Apr-83 Hindustan Teleprinters Ltd
28 RAHUL SUNDARAM * 36 Deputy Vice President - Legal 2026825 1541088 M.A., LLB., LLM 14 21-Jul-08 Citifinancial Consumers
Finance Limited
29 RAVINDRA NATH PATHAK 34 Country Manager, PC Collections 2872409 2140672 B.Sc., MBA 13 5-Jul-07 GE Money
30 S SAJIT KUMAR 36 Head Credit PC 2726004 2000292 M.Sc., MBA 12 4-Aug-06 ICICI Bank Limited
31 S SENTHAMIL SELVAN 41 Country Manager, CV Collections 2537828 1867178 BSc. 21 21-Nov-94 PAL Credit
32 SAMEER BHANUSHE 41 Associate Vice President - MIS 2737053 1886543 B.Com 23 6-Oct-92 Bankim Mehta Share
& Stock Broker
33 SANDHYA V VARTAK 44 Deputy Vice President - Operations 4332788 2813100 B.Com, M. Com, ICWA 22 23-Jun-87 Tata Motors Limited
34 SANJAY ASHIA 40 State Head - Sales CV Finance (Rajasthan) 2468656 1710696 B.Com, CA 18 25-Aug-03 Bajaj Auto Finance Limited
35 SANJAY GOEL 46 Regional Collection Manager CV 2881122 1939901 Dip in Automobile 25 1-Jun-95 Ashok Leyland Limited
Finance (North) Engineering
36 SANJAY SAWANT 53 Head - CV Fleet 5040353 3304766 B. Com, LLB, Dip in 29 1-Aug-88 M/S Scindia Steam
Management Studies Navigation Co Ltd
37 SHANTANU PADHYE 40 Head - Sales Passenger Car Finance 2662312 1920234 BE(Mech) 17 25-Feb-08 Eicher Motors Limited
38 SHASHI RANJAN KUMAR * 41 Vice President - Human Resources 1306283 1003710 B Sc., PGDPM 16 10-Nov-08 Globus Stores Pvt. Limited
39 SHRIRANG DATE 45 Head - Risk 3255958 2268236 B.Sc., MBA 21 5-Sep-06 ICICI Bank Limited
40 SRIDHAR NARASIMHAN 45 Associate Vice President - SAP 2813734 1902878 M.Com 25 7-Aug-95 M/s Viswapriya Financial
Services & Securities Limited
41 SUBROTO KUMAR 43 Regional Legal Remedial Manager - North 3053781 2323093 B.Com., CA 21 30-Oct-01 Tata Motors Limited
42 SUDIP ROY 43 Head - Retail Sales CV Finance 4506019 2987660 B. Com 20 12-Sep-88 Tata Motors Limited
43 SUNIL KELKAR * 49 Head - Administration 1143688 830474 B.Com., DHRD 27 28-May-07 Kotak Mahindra Bank Limited
44 SUNIL V SHAH 48 Head Sales & Marketing 3100346 2126513 B. Com 27 1-Apr-86 Indian Duplicator Company
Vertical - e-Nxt Limited
45 TARUN SAMANT 45 Senior Vice President - Passenger 5746755 3718503 BA (Eco). MBA 23 7-Aug-06 GMAC Financial Services Limited
Car Finance
46 VINU NAIR 37 Head - Collections ‘ X ‘ Bucket 2465012 1678806 M. Com 13 2-Jan-06 ICICI Bank Limited
Notes

(1) The Gross Remuneration shown above is subject to tax and comprises of salary, allowance, monetary value of perquisites as per Income-tax rules and Company’s
contribution to provident fund and superannuation fund
(2) In addition to the above remuneration, employees are entitle to gratuity, medical benefits, etc. in accordance with the Company’s rules.
(3) The net remuneration is arrived at by deducting from the gross remuneration, income-tax, Company’s contribution to provident fund, superannuation fund and the
monetary value of non-cash perquisites, wherever applicable.
(4) The remuneration as disclosed above, includes performance linked payments for employees for the previous year, which were approved by the management during
the year.
(5) All the employees have adequate experience to discharge the responsibilities assigned to them.
(7) None of the employees mentioned above is relative of any Director of the Company.
(8) Asterisk against a name indicates that the employee was in service only for a part of the year
On behalf of the Board of Directors

Mumbai, May 18, 2009 Chairman

3
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

AUDITORS’ REPORT
To the Memb
Memb ers of Ta ta M
embers ot
Mot ors FFinanc
otors inanc
inancee Limit ed
Limited ANNEXURE TO THE AUDITORS’ REPORT
1. We have audited the attached balance sheet of Tata Motors Finance Limited, (Referred to in paragraph 3 of our report of even date)
as at March 31, 2009, and also the profit and loss account and the cash flow (i) (a) The company has maintained proper records showing full particulars
statement for the year ended on that date, both annexed thereto. These including quantitative details and situation of fixed assets.
financial statements are the responsibility of the company's management.
Our responsibility is to express an opinion on these financial statements (b) According to the information and explanations given to us, the company
based on our audit. has adopted a phased programme of physical verification of fixed
assets. Under this programme, all the assets would be verified in a
2. We conducted our audit in accordance with the auditing standards period of three years, the frequency of which, in our opinion, is reasonable,
generally accepted in India. These Standards require that we plan and having regard to the size of the company and the nature of its assets. As
perform the audit to obtain reasonable assurance about whether the explained to us, no material discrepancies were noticed in respect of
financial statements are free of material misstatement. An audit includes assets verified during the year.
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. An audit also includes assessing the accounting (c) In our opinion and according to the information and explanations given
principles used and significant estimates made by management, as well as to us, the fixed assets disposed off during the year are not substantial
evaluating the overall financial statement presentation. We believe that so as to affect going concern and therefore the question of reporting on
our audit provides a reasonable basis for our opinion. ‘ clause 4(i)(c) of the Companies (Auditor's Report) Order, 2003
(hereinafter referred to as the said Order) does not arise.
3. As required by the Companies (Auditor's Report) Order, 2003, issued by
(ii) According to the information and explanations given to us and having regard
the Central Government of India in terms of section 227(4A) of the Companies
to the nature of the company's business, the question of reporting on clause
Act, 1956, we enclose in the Annexure a statement on the matters specified
4(ii) (relating to inventory) of the said Order does not arise.
in paragraphs 4 and 5 of the said Order.
(iii) (a) According to the information and explanations given to us, the company
4. Further to our comments in the Annexure referred to in paragraph 3 above, has not granted any loans to companies, firms or other parties covered
we report that: in the register maintained under section 301 of the Companies Act,
(a) we have obtained all the information and explanations, which to the 1956. In view of the foregoing, the question of reporting on clauses 4(iii)(b),
best of our knowledge and belief were necessary for the purposes of 4(iii)(c) and 4(iii)(d) of the said Order does not arise.
our audit; (b) According to the information and explanations given to us, the company
(b) in our opinion, proper books of account as required by law have been has not taken any loans, from companies, firms or other parties covered
kept by the company, so far as appears from our examination of those in the register maintained under section 301 of the Companies Act,
books; 1956. In view of the foregoing, the question of reporting on clauses 4(iii)(f )
and 4(iii)(g) of the said Order does not arise.
(c) the balance sheet, the profit and loss account and the cash flow
statement dealt with by this report are in agreement with the books (iv) In our opinion and according to the information and explanations given to
of account; us, there is an adequate internal control system commensurate with the size
of the company and the nature of its business with regard to purchases of
(d) in our opinion, the balance sheet, the profit and loss account and the fixed assets and with regard to sale of services; there are neither purchases
cash flow statement dealt with by this report comply with the of inventory nor sale of goods. During the course of our audit, we have not
accounting standards referred to in section 211(3C) of the Companies observed any continuing failure to correct major weaknesses in internal
Act, 1956; control system in respect of these areas.
(e) in our opinion and to the best of our information and according to the (v) According to the information and explanations given to us, there are no
explanations given to us, the said accounts give the information transactions that need to be entered into the register maintained under
required by the Companies Act, 1956, in the manner so required and section 301 of the Companies Act, 1956. In view of the foregoing, the question
give a true and fair view in conformity with the accounting principles of reporting on clauses 4(v) of the said Order does not arise.
generally accepted in India: (vi) In our opinion and according to the information and explanations given to
(i) in the case of the balance sheet, of the state of affairs of the company us, the company has not accepted any deposits from the public to which
as at March 31, 2009; the provisions of sections 58A and 58AA or any other relevant provisions of
the Companies Act, 1956 and the rules framed there under would apply.
(ii) in the case of the profit and loss account, of the loss for the year ended
on that date; and (vii) In our opinion, the company has an internal audit system commensurate
with its size and the nature of its business.
(iii) in the case of the cash flow statement, of the cash flows for the year
(viii) According to the information and explanations given to us, maintenance of
ended on that date.
cost records has not been prescribed by the Central Government under
5. On the basis of written representations received from the directors, as on section 209(1)(d) of the Companies Act, 1956. In view of the foregoing, the
March 31, 2009 and taken on record by the Board of Directors, we report that question of reporting on clause 4(viii) of the said Order does not arise.
none of the directors is disqualified as on March 31, 2009 from being appointed (ix) (a) According to the records of the company, the company is regular in
as a director in terms of section 274(1)(g) of the Companies Act, 1956. depositing with the appropriate authorities, undisputed statutory dues
For Deloitte Haskins & Sells including provident fund, investor education and protection fund,
Chartered Accountants employees' state insurance, income-tax, sales tax, wealth-tax, service
tax, customs duty, excise duty, cess and other material statutory dues
applicable to it.
R. K. Hiranandani
(b) According to the information and explanations given to us, no
Partner
undisputed statutory dues, including provident fund, investor education
Membership No. 36920 and protection fund, employees' state insurance, income-tax, sales tax,
Place : Mumbai wealth-tax, service tax, customs duty, excise duty, cess and other
Date : 18th May,2009 material statutory dues applicable to the company, were in arrears, as
at March 31, 2009, for a period of more than six months from the date
they became payable.
(c) According to the information and explanation given to us, there are no
dues of income-tax, sales tax, wealth-tax, service tax, customs duty,
excise duty and cess, as applicable to it, which have not been deposited
on account of any dispute.

4
(x) The company is registered for a period of less than five years. In view prepared in accordance with the Reserve Bank of India's Guidelines, we
of the foregoing, the question of reporting on clause 4(x) of the said report that no funds raised on short-term basis have been used for long-
Order does not arise. term investment.
(xi) In our opinion and according to the information and explanations given (xviii) The company has not made any preferential allotment of shares to
to us, the company has not defaulted in repayment of dues to financial parties covered in the register maintained under section 301 of the
institutions, banks or debenture holders. Companies Act, 1956. Therefore, the question of reporting on whether
the price at which such shares have been issued is prejudicial to the
(xii) In our opinion and according to the information and explanations given
interest of the company does not arise.
to us, the company has not granted loans and advances on the basis of
security by way of pledge of shares, debentures and other securities. (xix) According to the information and explanations given to us, the company
In view of the foregoing, the question of reporting under clause 4(xii) of had issued debentures aggregating Rs. 617,20.00 lakhs, outstanding as
the said Order does not arise. at the year ended March 31, 2009, covered by our audit. The company
has created charge in respect of such debentures as per the terms of
(xiii) The company is not a chit fund or a nidhi/mutual benefit fund/society.
issue.
Therefore, the provisions of clause 4(xiii) of the said Order are not
applicable to the company. (xx) The company has not raised any money by public issues during the
year. Accordingly, the question of disclosure of end use of such monies
(xiv) The company is not dealing in or trading in shares, securities, debentures
does not arise.
and other investments. Therefore, the provisions of clause 4(xiv) of the
said Order are not applicable to the company.
(xv) In our opinion and according to the information and explanations given (xxi) According to the information and explanations given to us, no fraud on
to us, the company has not given any guarantee for loans taken by or by the company has been noticed or reported during the course of
others from banks or financial institutions. our audit.
For Deloitte Haskins & Sells
(xvi) In our opinion and according to the information and explanations given
Chartered Accountants
to us, the term loans have been applied for the purpose for which they
were raised.
(xvii) According to the information and explanations given to us and on an R. K. Hiranandani
overall examination of the balance sheet of the company, and Partner
information furnished, including the statement of Structural Liquidity Membership No. 36920
Place : Mumbai
Date : 18th May,2009

5
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

Balance Sheet as at March 31, 2009 Profit and Loss Account for the period ended March 31, 2009
As at As at Year ended Year ended
March 31, March 31, March 31, March 31,
2009 2008 2009 2008
Schedule Rs. in Lakhs Rs. in Lakhs Schedule Rs. in Lakhs Rs. in Lakhs
INCOME
SOURCES OF FUNDS
1 SHAREHOLDERS’ FUNDS 1 Income from operations and other income 13 919,93.94 834,35.63

(a) Share capital 1 850,00.00 750,00.00 EXPENDITURE

(b) Reserves and surplus 2 511,51.34 457,56.66 2 Operating expenses 14 613,90.81 346,41.00
1361,51.34 1207,56.66 3 Pre-incorporation / share issue 90.17 90.17
2 LOAN FUNDS expenses written off

(a) Secured loans 3 4268,53.36 3348,43.50 4 Depreciation 6,79.66 4,12.58


(b) Unsecured loans 4 941,50.00 1577,33.00 5 Interest (net) 15 460,25.05 432,65.78
5210,03.36 4925,76.50 Profit / (loss) before tax (161,91.75) 50,26.10
3 TOTAL FUNDS EMPLOYED
EMPLO 6571,54.70 6133,33.16 Tax expenses
APPLIC
APPLICAATION OF FUNDS
Income tax - Current (see note 17(a)) 33,00.00 18,00.00
4 FIXED ASSETS 5
- Deferred (see note 17(b)) (75,32.13) (13,81.28)
(a) Gross block 42,41.40 41,25.94
Fringe benefit tax 1,11.88 1,30.00
(b) Less : depreciation 10,43.15 4,40.59
(41,20.25) 5,48.72
(c) Net block 31,98.25 36,85.35
(d) Capital work-in-progress 66.09 49.63 Profit / (loss) after tax (120,71.50) 44,77.38

32,64.34 37,34.98 Balance brought forward 46,05.32 10,23.42


5 INVESTMENTS 6 13,23.35 14,50.54 Appropriation
6 DEFERRED TA X ASSET (see note 17(b))
note 89,05.50 13,73.37 - Special reserve - 8,95.48
7 CURRENT ASSET S, LLO
ASSETS, O ANS AND AD
ADVVANCES Balance carried to balance sheet (74,66.18) 46,05.32
(a) Interest accrued on deposits with banks 21,72.19 15,04.87 Earnings per share
(b) Cash and bank balances 7 1446,35.02 1260,70.13
(Nominal value per share Rs. 10)
(c) Loans and advances 8 5568,43.38 5312,35.37
Basic and diluted (in Rupees) (1.59) 0.77
(d) Other Current Assets 9 54,36.19 11,19.36
Weighted average number of outstanding shares 760,616,438 579,849,727
7090,86.78 6599,29.73
8 Less :CURRENT LIABILITIES Significant accounting policies 16
AND PROVISIONS Notes to the accounts 17
(a) Current liabilities 10 645,05.99 508,51.81
(b) Provisions 11 84,30.36 24,38.72
729,36.35 532,90.53
9 NET CURRENT ASSETS 6361,50.43 6066,39.20
10 MISCELLANEOUS EXPENDITURE 12 44.90 1,35.07
( To the extent not written off or adjusted )
11 DEBIT BALANCE IN PROFIT AND 74,66.18 -
LOSS ACCOUNT
12 TOTAL ASSETS (NET )
ASSETS 6571,54.70 6133,33.16
13 Significant accounting policies 16
14 Notes to the accounts 17

Per our report attached For and on behalf of the Per our report attached For and on behalf of the
Board of Directors Board of Directors
For DELOITTE HASKINS & SELLS For DELOITTE HASKINS & SELLS
Chartered Accountants PR
PRAAVEEN P.K
P.K ADLE
.KADLE Chartered Accountants PR
PRAAVEEN P.K
P.K ADLE
.KADLE
BHAR
BHARAAT VASANI BHAR
BHARAAT VASANI
R. K. Hiranandani SHYAM MANI
SHYAM H.N.SINOR R. K. Hiranandani SHYAM MANI
SHYAM H.N.SINOR
Partner Managing Director C. RAMAKRISHNAN Partner Managing Director C. RAMAKRISHNAN
Directors Directors
VINA
VINAYY LLA
AVANNIS VINA
VINAYY LLA
AVANNIS
Dy. Company Secretary Dy. Company Secretary
Mumbai Mumbai Mumbai Mumbai
May 18, 2009 May 18, 2009 May 18, 2009 May 18, 2009

6
Cash Flow Statement for the year ended March 31, 2009
Year ended Year ended
March 31,2009 March 31,2008
Rs. in Lakhs Rs. in Lakhs
A. CASH FL FLOO W FR OM OPER
FROM ATING A
OPERA CTIVITIES
ACTIVITIES
Profit / (loss) after tax (120,71.50) 44,77.38
Adjustments for:
Income tax 33,00.00 18,00.00
Deferred tax (75,32.13) (13,81.28)
Fringe benefit tax 1,11.88 1,30.00
Pre-incorporation / share issue expenses written off 90.17 90.17
Depreciation 6,79.66 4,12.58
Interest income (96,58.28) (29,41.64)
Dividend from current investments (13.18) (4,13.65)
Loss on sale of fixed assets 16.34 3.14
Profit on sale of current Investments (2,95.29) -
Provision for retirement and other employee benefit schemes 43.04 1,37.00
Provision for doubtful loans 193,49.47 6,228.72
Provision for expected loss on future securitised receivables 39,89.93 -
Provision in respect of liability for servicing assigned receivables 19,58.67 -
Operating cash flow before working capital changes (31.22) 85,42.42
Adjustments for:
Loans and advances and other current assets (455,26.65) (1288,65.28)
Trade and other payables 136,54.18 179,09.93
(318,72.47) (1109,55.35)
Direct taxes paid (71,59.54) (39,54.76)
Net cash used in operating activities (390,63.23) (1063,67.69)
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of fixed assets (including capital advances) (5,97.70) (32,61.25)
Sale of fixed assets 3,72.34 3,15.57
Purchase of investments (5205,13.17) (979,41.29)
Purchase/sale of investment in retained interest in securitization transaction 73.19 (3,00.54)
Sale / redemption of investments 5208,62.46 967,91.29
Dividend from current investments 13.18 4,13.65
Interest Income 89,90.96 14,61.26
Inter corporate deposit given (145,00.00) -
Inter corporate deposit refunded 145,00.00 -
Net cash from/used in investing activities 92,01.26 (25,21.31)
C. CASH FLOW FROM FINANCING ACTIVITIES
Issue of share capital (including securities premium thereon) 200,00.00 600,00.00
Increase in cash credit 652,59.86 20,09.57
Proceeds from borrowings 5250,00.00 5151,30.00
Repayment of borrowings (5618,33.00) (3586,77.00)
Net cash from financing activities 484,26.86 2184,62.57
Net increase in cash and cash equivalents 185,64.89 1095,73.57
Cash and ccash
ash equiv alen
equivalen ts as aatt the b
alents eginning of the yyear
beginning ear,, ccompr
ear ompr ising:
omprising:
Cash on hand 1,06.88 51.38
Cheques on hand 29,64.02 17,54.16
Stamp papers, postal stamps etc. 54.22 1,87.41
Current accounts with scheduled banks 164,39.77 39,79.61
Fixed Deposits with banks 3,27.46 -
Cash collateral with banks * 1061,77.78 105,24.00
1260,70.13 164,96.56
Cash and ccash
ash equiv alen
equivalen ts as aatt the end of the yyear
alents ear
ear,, ccompr
ompr ising:
omprising:
Cash on hand 2,86.27 1,06.88
Cheques on hand 57,29.70 29,64.02
Stamp papers, postal stamps etc. 37.27 54.22
Current accounts with scheduled banks # 118,22.49 164,39.77
Fixed Deposits with banks 5,77.15 3,27.46
Cash collateral with banks * 1261,82.14 1061,77.78
1446,35.02 1260,70.13
Net increase in cash and cash equivalents 185,64.89 1095,73.57
* Not freely available for use by the company.
# includes Rs. 1,51.17 lakhs (as at March 31, 2008 : Rs. Nil) not freely available for use by the company.
Notes:
1. Interest paid has been considered as arising from operating activities in view of the nature of the company’s business.
2. Previous year figures have been regrouped, wherever necessary.

Per our report attached For and on behalf of the Board of Directors
For DELOITTE HASKINS & SELLS
Chartered Accountants PR
PRAAVEEN P
P.. K ADLE
KADLE
BHAR
BHARAAT VASANI
R. K. Hiranandani SHYAM MANI
SHYAM H.N.SINOR
Partner Managing Director C. RAMAKRISHNAN
Directors
VINA
VINAYY LLA
AVANNIS
Dy. Company Secretary
Mumbai Mumbai
May 18, 2009 May 18, 2009

7
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

Schedules annexed to and forming part of the Balance Sheet as at March 31, 2009

As at As at As at As at
March 31, March 31, March 31, March 31,
2009 2008 2009 2008
Rs. in Rs. in Schedule “3” Rs. in Rs. in
Lakhs Lakhs SECURED LOANS Lakhs Lakhs
Schedule “1” Privately placed non - convertible debentures * 617,20.00 617,20.00
(Refer note 10(a) on schedule 17)
SHARE C APIT
CAPIT AL
APITAL
Loans from banks:
Authorised: (Refer note 10(b) on schedule 17)
125,00,00,000 (as at March 31, 2008: 75,00,00,000) 1250,00.00 750,00.00 - Term loans 1302,50.00 1435,00.00
Equity shares of Rs.10 each (repayable within a year Rs. 1052,50.00 lakhs;
as at March 31, 2008: Rs. 1182,50.00 lakhs)
750,00,000 Preference shares of Rs.100 each 750,00.00 750,00.00 - Working capital demand loan 840,00.00 480,00.00
2000,00.00 1500,00.00 (repayable within a year Rs. 840,00.00 lakhs;
as at March 31, 2008: Rs. 480,00.00 lakhs)
Issued and subscribed:
- Cash credit 1468,83.36 816,23.50
85,00,00,000 (as at March 31, 2008: 75,00,00,000) 850,00.00 750,00.00
Loans from others - SICOM Limited 40,00.00 -
Equity shares of Rs.10 each fully paid-up (Refer note 10(b) on schedule 17)
(All the equity shares are held by the holding (repayable within a year Rs. 40,00.00 lakhs ;
as at March 31, 2008 : Rs. Nil)
company, Tata Motors Limited and its nominees)
4268,53.36 3348,43.50
850,00.00 750,00.00
* Ter ms of rredemption:
erms edemption:
Privately placed Non Convertible Rs. in Lakhs Redeemable on
Schedule “2”
Debentures
RESERVES AND SURPLUS As at Additions Deductions As at 11.03% Non Convertible Debentures-A 90,00.00 May 21, 2009 (At par)
April 01, March 31, 11.03% Non Convertible Debentures-B 25,00.00 June 22, 2009 (At par)
2008 2009 10.97% Non Convertible Debentures-C 25,00.00 August 25, 2009 (At par)
Rs. in Rs. in Rs. in Rs. in 10.92% Non Convertible Debentures-D 10,00.00 Nov 30, 2009 (At par)
Lakhs Lakhs Lakhs Lakhs 10.93% Non Convertible Debentures-E 117,20.00 June 28, 2010 (At par)
10.64% Non Convertible Debentures-F 150,00.00 July 13, 2009 (At par)
(a) Securities premium 400,00.00 100,00.00 - 500,00.00
10.35% Non Convertible Debentures-G 100,00.00 July 20, 2010 (At par)
(100,00.00) (300,00.00) - (400,00.00) 9.73% Non Convertible Debentures-H 100,00.00 July 30, 2010 (At par)
(b) Special reserve 11,51.34 - - 11,51.34
(2,55.86) (8,95.48) - (11,51.34) As at As at
411,51.34 100,00.00 - 511,51.34 March 31, March 31,

(102,55.86) (308,95.48) - (411,51.34) 2009 2008


(c) Profit and loss account - Schedule “4” Rs. in Rs. in
UNSECURED LOANS Lakhs Lakhs
(46,05.32)
Loans and advances from banks: 630,00.00 1540,00.00
511,51.34 (repayable within a year Rs. 630,00.00 lakhs;
(457,56.66) as at March 31, 2008: Rs. 1410,00.00 lakhs)
Note : Figures in brackets relate to the year ended March 31, 2008 / are as at March Short term loans and advances from others:
31, 2008. - Commercial paper 275,00.00 19,60.00
- Inter corporate deposits 36,50.00 17,73.00
941,50.00 1577,33.00
Schedule “5”
FIXED ASSETS
Rs in lakhs
Particulars Gross Block Depreciation Net Block
Opening Additions Deletions Closing Opening Depreciation Deletions Closing As at As at
balance balance balance for the year balance March 31, March 31,
as at as at as at as at 2009 2008
April 01, March 31, April 01, March 31,
2008 2009 2008 2009
Buildings (residential flats) 72.84 - - 72.84 1.07 1.19 - 2.26 70.58 71.77
Office equipment 3,81.89 41.70 4.18 4,19.41 17.38 19.38 0.26 36.50 3,82.91 3,64.51
Data processing machines 15,17.29 1,28.99 63.27 15,83.01 1,41.27 2,71.07 6.85 4,05.49 11,77.52 13,76.02
Furniture and fixtures 9,86.76 87.44 16.85 10,57.35 87.43 1,01.66 3.89 1,85.20 8,72.15 8,99.33
Vehicles 8,16.96 3,23.11 3,81.48 7,58.59 1,08.20 2,07.19 66.10 2,49.29 5,09.30 7,08.76
Plant and machinery 36.67 - - 36.67 4.17 4.15 - 8.32 28.35 32.50
Software (Intangible) 3,13.53 - - 3,13.53 81.07 75.02 - 1,56.09 1,57.44 2,32.46
Sub-total 41,25.94 5,81.24 4,65.78 42,41.40 4,40.59 6,79.66 77.10 10,43.15 31,98.25
Previous year 8,45.65 36,03.38 3,23.09 41,25.94 32.39 4,12.58 4.38 4,40.59 36,85.35
Capital work in progress [includes advances for capital expenditure Rs. Nil (as at March 31, 2008:Rs. 6.00 lakhs)] 66.09 49.63
TOTAL 32,64.34 37,34.98
Note: Buildings include value of shares in Nilgiri Upvan Co-operative Housing Society Limited, certificate in respect of which is yet to be received.

8
Schedules annexed to and forming part of the Balance Sheet as at March 31, 2009

As at As at As at As at
March 31, March 31, March 31, March 31,
2009 2008 2009 2008
Rs. in Rs. in Rs. in Rs. in
Lakhs Lakhs
Lakhs Lakhs
Schedule “8”
Schedule “6”
LOANS AND AD ADVVANCES
Long term - Trade (unquoted)
A) SECURED
Jayem Automotive Limited
(a) Vehicle loans [see note 1 below] #
1,618,000 16% Optionally Convertible 10,96.00 11,50.00
Debentures of Rs. 100/- each * - Considered good 4963,61.31 5163,39.90
[Rs. 8.48 redeemed per debenture - Considered doubtful 237,67.89 44,18.42
(upto March 31, 2008 Rs.5.14)] (b) Assignment receivables in respect
Retained interest in securitisation transaction 2,27.35 3,00.54 of vehicle loans (see notes below)
13,23.35 14,50.54 (Considered good) 436,13.73 -
* Rate of interest restructured from 9% vide agreement dated May 21, 2007. 5637,42.93 5207,58.32
Investments purchased and sold during Cost of acquisition Less: Provision for doubtful loans @ 237,67.89 44,18.42
the yyear
ear
ear,, other than sho wn ab
shown aboo ve: Rs. in Lakhs 5399,75.04 5163,39.90
Investments in Mutual Funds # Includes Rs.258,00.41 lakhs
LIC Mutual Fund (as at March 31, 2008:Rs. 69,53.86 lakhs) on
account of overdue securitised receivables
- LICMF Liquid Fund - Dividend
Plan - daily dividend reinvestment @ Includes Rs. 53,44.79 lakhs
(as at March 31, 2008:Rs. 3,14.46 lakhs)
45552117 Units of Rs. 10/- each 50,01.66 towards overdue securitised receivables
- LICMF Liquid Fund - Growth Plan B) UNSECURED - considered good
1008237789 Units of Rs. 10/- each 1580,00.00 (a) Prepaid expenses 87,33.18 87,65.69
TATA Mutual Fund (b) Advances recoverable in cash or in 19,34.34 35,26.90
- Tata Liquid super high investment kind or for value to be received
fund - daily dividend
(c) Deposits 3,30.14 4,79.86
852887 Units of Rs. 1000/- each 95,05.59
(d) Advance payment of income tax, 58,43.18 21,02.64
- Tata Liquid super high investment net of provision
fund - appreciation
(e) Advance payment of fringe benefit tax, 27.50 20.38
8609596 Units of Rs. 1000/- each 1360,00.00 net of provision
Birla Sun Life Mutual Fund 168,68.34 148,95.47
- Birla Sun Life Cash Plus - Institutional Total 5568,43.38 5312,35.37
Premium - daily dividend reinvestment Notes:
89883965 Units of Rs. 10/- each 90,05.92 1. Vehicle loans are secured against hypothecation of the underlying vehicle.
- Birla Sun Life Cash Plus 2. In respect of assignment receivables, credit enhancement has also been granted
- Institutional Premium - Growth by the originator.
198471004 Units of Rs. 10/- each 270,00.00
Principal Mutual Fund
Schedule “9”
- Principal Cash Management Fund - Liquid
Option Institutional Premium Plan - Growth OTHER CURRENT ASSETS
657220012 Units of Rs. 10/- each 875,00.00 Receivables on account of service charges, 54,36.19 11,19.36
incentives, etc.
UTI Mutual Fund 54,36.19 11,19.36
- UTI Liquid Cash Plan Institutional - Growth
Schedule “10”
1498994 Units of Rs. 1000/- each 210,00.00
CURRENT LIABILITIES
ICICI Prudential Mutual Fund
(a) Sundry creditors (refer note 5 on schedule 17)
lCICI Prudential Institutional Liquid Plan
- Super Institutional Growth - dues of micro enterprises and - 4.90
small enterprises
277174426 Units of Rs. 10/- each 350,00.00
- dues of creditors other than micro 614,57.93 428,26.66
Lotus India Mutual Fund enterprises and small enterprises
- Lotus India Liquid Fund (b) Security deposits from dealers/customers 37.66 41.43
- Super Institutional - Growth
(c) Unamortised income 30,09.36 73,16.50
85532956 Units of Rs. 10/- each 100,00.00
(d) Interest accrued but not due :
Deutsche Mutual Fund
(i) on loans - 98.78
- DWS Insta Cash Plus Fund - Super
Institutional Plan - Growth (ii) on securitised contracts, etc. 1.04 5,63.54
200731329 Units of Rs. 10/- each 225,00.00 645,05.99 508,51.81
Schedule “11”
As at As at
March 31, March 31, PROVISIONS
2009 2008 (a) Provision for retirement and other employee 6,71.18 6,28.14
Rs. in Rs. in benefit schemes
Schedule “7” Lakhs Lakhs (b) Provision for expected loss on future securitised 58,00.51 18,10.58
CASH AND BANK BALANCES receivables (provision made during the year
Rs. 39,89.93 lakhs (previous year Rs. 18,10.58 lakhs))
(a) Cash on hand 2,86.27 1,06.88
(c) Provision in respect of liability for servicing 19,58.67 -
(b) Cheques on hand 57,29.70 29,64.02 assigned receivables (made during the year)
(c) Stamp papers, postal stamps, etc. 37.27 54.22 84,30.36 24,38.72
60,53.24 31,25.12 Schedule “12”
(d) Current accounts with scheduled banks 118,22.49 164,39.77 MISCELLANEOUS EXPENDITURE
(e) Deposits with banks 1267,59.29 1065,05.24 (to the extent not written off or adjusted)
(includes cash collateral Rs. 1261,82.14 lakhs; Pre- incorporation / share issue expenses 1,35.07 2,25.24
as at March 31, 2008: Rs. 1061,77.78 lakhs)
Less: written off 90.17 90.17
1385,81.78 1229,45.01
44.90 1,35.07
1446,35.02 1260,70.13

9
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

Schedules annexed to and forming part of Year ended Year ended


profit and loss account for the year ended March 31, 2009 March 31, March 31,
2009 2008
Year ended Year ended
March 31, March 31, Schedule “14” (C on
onttd .)
(Con Rs. in Lakhs Rs. in Lakhs
2009 2008 OPERA
OPER ATING EXPENSES
Rs. in Lakhs Rs. in Lakhs Note: Other expenses include
Schedule “13” Field Investigation Expenses 1,229.48 1,491.83
INCOME
INCOME FR OM OPER
FROM OPERAATIONS AND IT Expenses 753.24 1,194.70
OTHER INCOME Legal and Professional Charges 563.11 774.86
1. Income from operations Marketing Expenses 1,705.31 2,125.95
(a) Interest 652,34.75 645,05.59 Securitisation Expenses 739.20 981.79
(b) Income on securitization / 107,73.30 17,16.99 Service Providers Charges 5,793.01 3,707.47
assignment receivables (net)
Travelling and Conveyance 988.21 1,211.03
(see note 6(b) on schedule 17)
Schedule “15”
(c) Discounting charges - 3,12.53
INTEREST
(d) Income from operating lease - 32.70
(a) Interest expenses
(e) Others 54,64.17 53,51.60
- on fixed period loans 424,15.69 433,30.78
814,72.22 719,19.41
- on others 125,90.93 24,58.60
2. Other income
550,06.62 457,89.38
(a) Service charges
(b) Interest income on bank accounts (gross) (89,81.57) (25,23.60)
- Holding company 69,80.66 57,78.39 (tax deducted at source Rs. 20,29.89 Lakhs :
- Others 4,83.59 - previous year Rs.5,15.22 Lakhs)
74,64.25 57,78.39 460,25.05 432,65.78
(b) Interest income on long term trade 2,38.80 2,24.89 Schedule 16
investments (gross)
(tax deducted at source Rs. 54.11 Lakhs : SIGNIFICANT ACCOUNTING POLICIES
previous year Rs. 50.96 Lakhs) 1. Basis for preparation of accounts
(c) Income from current investments
The financial statements have been prepared and presented under the
(i) Dividend 13.18 4,13.65 historical cost convention, on the accrual basis of accounting and in accordance
(ii) Interest (Gross) - 1,93.15 with the generally accepted accounting principles and complies with the
(tax deducted at source Rs. Nil : relevant provisions / notifications of the Companies Act, 1956. Further, the
previous year Rs.24.58 Lakhs) Company follows the directions issued by the Reserve Bank of India (RBI) for
Non-Banking Financial Companies (NBFC).
(d) Interest income on inter corporate deposits 4,37.91 -
(tax deducted at source Rs. 99.23 Lakhs : 2. Revenue recognition
previous year Rs.Nil ) i) Income on Vehicle loans
(e) Profit on sale of current investments 2,95.29 - Income on vehicle loans is accounted for by using the internal rate of
(f) Miscellaneous (see note 7 on schedule 17) 20,72.29 49,06.14 return method. Consequently, a constant rate of return on net
outstanding amount is accrued over the period of the contract, except
105,21.72 115,16.22
that no income is recognized on non-performing / doubtful assets as per
919,93.94 834,35.63 the prudential norms for income recognition issued by the RBI for NBFCs.
Schedule “14” Interest income on such assets is recognized on receipt basis.
OPER
OPERAATING EXPENSES The Company provides an allowance for vehicle loans based on the
1 Payments to and provision for employees prudential norms issued by the RBI relating to income recognition,
asset classification and provisioning for non-performing assets. In
(a) Salaries and bonus 66,47.73 57,48.51
addition to the provisioning as per RBI norms, provision is also being
(b) Superannuation, gratuity, etc. 4,10.97 1,98.20 made for the anticipated non recoverable, where any of the installments
(c) Contribution to provident fund, etc. 2,62.77 2,58.17 are overdue for a period exceeding 11 months. The Company also
(d) Staff welfare expenses 5,20.59 2,74.80 makes provision, if any, to comply with the Guidelines on Securitisation
of Standard Assets issued by the RBI.
78,42.06 64,79.68
ii) Interest on un-booked contracts
2 Other expenses
Interest on disbursed but un-booked contracts is accrued based on the
(a) Repairs to buildings 57.45 39.21 weighted average internal rate of return of the contracts booked in the
(b) Repairs to plant, machinery, etc. 35.59 88.92 previous month. Accrued interest is calculated for 15 days, being the
(c) Electricity 3,60.87 2,69.72 estimated average period of the balances outstanding as at the balance
sheet date.
(d) Rent 10,45.00 9,10.71
(e) Rates and taxes 62.55 77.88 3. Fixed assets
(f) Insurance 32.89 6.16 Fixed assets are stated at cost of acquisition less depreciation.
(g) Incentive / commission 44,41.17 43,82.39 4. Depreciation
(h) Provision for doubtful loans 193,49.47 44,18.14 Depreciation is provided on the straight-line method, at the rates and manner
(see note 6(a) on Schedule 17) prescribed in Schedule XIV to the Companies Act, 1956 except in the case of:
(i) Provision for expected loss on future 39,89.93 18,10.58 - Laptops – 23.75% (SLM)
securitised receivables (see note 6(a) - Vehicles – 23.75% (SLM)
on schedule 17)
- Capital assets, the ownership of which do not vest in the Company are
(j) Bad debts written off 88,12.74 11,62.70 depreciated over the estimated period of their utility or five years,
(k) Provision in respect of liability for 19,58.67 - whichever is lower.
servicing assigned receivables - Software of a cost in excess of Rs. 0.25 Lakh is amortised over a period
(see note 6(b) on schedule 17) of 60 months or on the basis of their estimated useful life, whichever is
(l) Other expenses (see note below) 134,02.42 149,94.91 lower.
535,48.75 281,61.32 5. Investments
613,90.81 346,41.00 Investments, all of which are long term, are stated at cost. Provision for
diminution is made to recognize a decline, other than temporary, in the value

10
of such investments. Current investments are stated at lower of cost and fair 15 to 30 days salary, payable for each completed year of service. Vesting
value. occurs upon completion of five years of service. The actuarially
determined liability is compared with the balances with the funds and
6. Commission to agents
the shortfall or excess is accounted for as a liability or an asset respectively.
Commission paid to Direct Selling Agents (DSA)/dealers for sourcing of contracts
b) Compensated absences
is amortised over the term of the contract in the ratio of interest earned.
Commission paid on achievement of targets is amortised equally over the Provision is made for encashment of leave or leave with pay subject to
period of 36 months since most of the contracts are entered for such period. certain rules. The employees are entitled to accumulate leave subject
Commission paid on collection is charged to profit and loss account when to certain limits, for future encashment. The liability is provided based
incurred. on the number of days of unutilised leave at each balance sheet date.
c) Post retirement medicare scheme
7. Income from assignment of receivables
Under this scheme, the employees are provided medical benefits after
Receivables on assignment are derecognised as all the rights, title and interest
retirement, subject to certain limits.
thereof are assigned to the investor. On derecognition, the difference between
the book value of receivables assigned and consideration received is dealt d) B havish
havish
vishyya K aly
Kaly an Yojana (BKY
alyan (BKY))
with as under: The benefits of the plan are provided to eligible employees based on
i) Profits on assignment through Special Purpose Vehicle (net of expenses their entitlement on death or permanent disablement, while in service.
such as DSA/dealer commission, etc and gross of income such as 11. Assets given / taken on operating lease
interest subsidy, etc.) are amortised over the balance life of the
securities issued / to be issued to the investor, in the ratio of interest Leases, where the lessor effectively retains substantially all the risks and benefits
that would have been earned on the securitised receivables over such of ownership of the leased assets are classified as operating leases. Operating
balance period. lease rent received / paid is recognised as an income / expense in the profit and
loss account on the straight-line basis over the lease term.
ii) Profits on direct assignment of receivables (net of expenses such as
DSA/dealer commission, etc and gross of income such as interest 12. Miscellaneous expenditure
subsidy, etc.) are recognised in the Profit and Loss account in the Miscellaneous expenditure comprising pre-incorporation / shares issue expenses
period in which the assignment is affected. Until the previous year, such as stamp duty and registration fees are being amortised over a period of
profits on such assignment were recognised in the manner described 36 months from the month in which the Company has commenced its operations
in paragraph 7(i) above (also see note 6(b) on schedule 17). / incurred the expenditure.
iii) Losses are recognized in the profit and loss account in the period in
which the assignment is affected. 13. Business segment
iv) Legal and incidental expenses are charged to profit and loss account The Company has been operating only in one segment viz, financial activities
in the period in which the assignment is affected and the operations being only in India, the disclosure requirements of Accounting
Standard-17 Segment Reporting are not applicable.
8. Provision in respect of liability for servicing assigned receivables
The estimated liability for servicing expenses in respect of assigned receivables Schedule 17
is made based on the ratio between the cost incurred for servicing current
receivables and the collection made during the year. This provision has been NOTES TO THE ACCOUNTS
necessitated consequent to the change in the method of accounting for profits 1. The Company was incorporated on June 01, 2006 as a wholly owned subsidiary
on direct assignment of receivables referred in paragraph 7 (ii) above. of Tata Motors Limited (TML) and is registered as a Non-Banking Financial
Company with the Reserve Bank of India (RBI) with effect from August 09, 2006.
9. Taxa tion
axation
2. Special reserve of Rs. 11,51.34 lakhs (as at March 31, 2008: Rs. 11,51.34 lakhs)
i) Income tax represents reserve created pursuant to the Reserve Bank of India (Amendment)
Current tax is the amount of tax payable on the taxable income for the Ordinance, 1997, as prescribed by section 45-IC of Reserve Bank of India Act,
financial year, as determined in accordance with the provisions of the 1934.
Income-tax Act, 1961. 3. During the year, the Company has assigned future loan receivables in respect
Deferred tax is recognized, subject to consideration of prudence, on of 92,912 (previous year : 113,336) contracts amounting to Rs. 3981,17.50 lakhs
timing difference between taxable income and accounting income (previous year : Rs. 5245,77.37 lakhs) for the consideration of Rs. 3742,18.69 lakhs
that originate in one period and are capable of reversal in one or more (previous year : Rs. 4702,71.75 lakhs).
subsequent periods. 4. The total amount of unbooked contracts as at March 31, 2009 is Rs. 1,17,36.60
ii) Fringe benefit tax lakhs (as at March 31, 2008: Rs. 109,84.57 lakhs). Interest of Rs. 85.35 lakhs (as at
Fringe benefit tax is the amount of tax payable on the value of benefits March 31, 2008: Rs. 62.76 lakhs) has been recognized on these unbooked contracts
provided during the period as determined in accordance with the (see para 2 (ii) on schedule 16).
provisions of the Income-tax Act, 1961. 5. Information in respect of micro enterprises and small enterprises to whom the
Company owes dues, which are outstanding as at the balance sheet date and
10. Employee benefits disclosed under current liabilities as defined under Micro, Small and Medium
i) Defined contribution plans Enterprises Development Act, 2006 has been determined to the extent such
Contributions to the company’s defined contribution plans, as parties have been identified on the basis of information available with the
described below, are charged to the profit and loss account. Company. This has been relied upon by the auditors.
a) Provident fund 6. a) During the year, there has been a refinement in the basis of determining
the provision to be made for doubtful loans which inter alia takes into
The employees are entitled to receive benefits under provident fund, account, the recovery trends of other similar loan contracts in arriving
where both, the employees and the Company, make monthly at the expected recoveries of doubtful loan contracts, consequently,
contributions at a specified percentage of the covered employees’ provision for doubtful loans is lower by Rs. 66,98.91 lakhs and provision
salary (currently 12% of employees’ eligible salary). The contribution is for expected loss on future securitised receivables is lower by Rs. 18,20.58
paid to the fund managed by the parent Company, except that the lakhs.
employer’s contribution towards pension fund is paid to the Regional
Provident Fund office. b) As a result of the change in accounting policy for recognising profits on
direct assignment of receivables and the consequent recognition of
b) Superannuation
provision in respect of liability for servicing assigned receivables referred
Contribution to the superannuation fund is made at 15% of basic salary respectively, in paragraphs 7(ii) and 8 on schedule 16, income on
for the employees who have opted to the scheme, managed by the securitisation/assignment receivables (net) is higher by Rs. 48,89.05 lakhs
parent Company. and provision in respect of liability for servicing assigned receivables
ii) Defined benefit plans has been made for Rs. 19,58.67 lakhs.
Provision for the company’s defined benefit plans, as described below, c) The aggregate effect of the change in accounting estimate and the
are actuarially determined using the projected unit credit method, changes in accounting policies referred above has resulted in the loss
based on an independent actuarial valuation at the end of the year. before tax being lower by Rs. 114,49.87 lakhs and the loss after tax being
Actuarial gains and losses are charged to the profit and loss account. lower by Rs. 75,58.06 lakhs.
a) Gratuity 7. During the previous year, the Company had assigned, with effect from September
Contributions are made towards gratuity, covering eligible employees, 29, 2007, its loans disbursed to small and medium enterprises, aggregate
principal amount outstanding as at that date: Rs. 92,47.29 lakhs, and with effect
which provides for a lump sum payment of an amount equivalent to

11
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

from September 01, 2007, its construction equipment loans, aggregate Note: Mr. Shyam Mani has been appointed as Managing Director with effect
principal amount outstanding as at that date: Rs. 628,62.65 lakhs, along with from October 30, 2007. The Remuneration Committee, the Board of Directors
the receivables and other balances related thereto and the underlying and shareholders have approved reimbursement of a part of the remuneration
securities, to another Company (the ‘assignee’) at book values. The Company paid by Tata Capital Limited (TCL) to Mr. Shyam Mani (who is on deputation
had also transferred its construction equipment financing activity along with from TCL), not exceeding Rs. 3,50,000 per month or Rs. 42,00,000 per annum for
transfer of some employees to the assignee effective September 01, 2007 and a period of three years with effect from April 1, 2008.
had entered into a non-compete agreement in respect of the aforesaid activity 13. Expenditure in foreign currency on accrual basis
for an overall consideration of Rs. 46,00.00 lakhs, which amount has been Rs. in Lakhs
included in Other income - Miscellaneous under Schedule “13”.
Year ended Year ended
8. Estimated amount of contracts remaining to be executed on capital account
March 31, March 31,
and not provided for Rs. 79.49 lakhs (as at March 31, 2008: Rs. 1,16.09 lakhs).
2009 2008
9. Other money for which the Company is contingently liable:
Travelling 1.01 4.65
Rs. in Lakhs
14. Related Party disclosures:
Particulars As at As at
1) Related parties and their relationship
March 31, March 31,
2009 2008 a) Holding Company
i) Cash collateral with banks [includes Rs. Nil 1261,82.14 1061,77.78 Tata Motors Limited
(as at March 31, 2008 Rs. 3,00.00 lakhs) in b) Fellow Subsidiaries
respect of receivables assigned by others *
Companies with whom there are transactions
ii) In respect of guarantees given for liability
against receivables assigned by way of 1 Concorde Motors (India) Limited (CONCORDE)
securitization * 2 Tata Motors Insurance Broking & Advisory Services Limited
- by banks 983,46.52 220,36.34 (formerly Tata Motors Insurance Services Limited) (TMIBASL)
- by others 135,73.89 - 3 Telco Construction Equipment Company Limited (TELCON)
iii) In respect of retained interest on 2,27.35 3,00.54 4 Sheba Properties Limited (Sheba)
securitisation transaction
5 Tata Technologies Limited (TTL)
* gross of provision for securitized receivables Rs.111,45.30 lakhs (as at March c) Key management personnel:
31, 2008 Rs. 21,25.04 lakhs).
10. Secured loans: 1. Mr. P. C. Bandivadekar Chief Operating Officer and Manager
(upto August 31, 2007)
Nature of security on loans including interest accrued thereon:
2. Mr. Jose Peter Chief Financial Officer
a. Privately placed non-convertible debentures are secured by:
(upto January 31, 2008)
i) First charge on one of the Company’s residential flats at Thane.
3. Mr. Shyam Mani Managing Director
ii) Pari - passu charge by way of hypothecation along with the security (from October 30, 2007)
trustee for loans from banks on:
- All receivables of the Company arising out of loan, lease and 2) Transactions with Related Parties
hire purchase transactions and trade advances, (a) Ta ta M ot
Mot ors Limit
otors ed - holding ccompan
Limited ompany
ompany
- All book debts arising out of loan / lease / hire purchase Rs. in Lakhs
transactions and advances to dealers, and
Sr. Particulars Year ended Year ended
- Receivables from senior and junior pass through certificates in
No. March 31, March 31,
which the borrower has invested.
2009 2008
iii) First charge on secured / unsecured loans given by the Company as
1. Subscription towards equity 200,00.00 600,00.00
identified from time to time and accepted by the debenture trustee.
share capital and share premium
iv) Any other security as identified by the Company and acceptable to
the debenture trustee. 2. Inter corporate deposits received 37,00.00 280,00.00
b. Loans from banks are secured by a pari-passu charge in favour of the 3. Inter Corporate deposits placed 145,00.00 -
security trustee on receivables and book debts specified in 10(a)(ii) 4. Interest expense on inter 20.44 -
above and such current assets as may be identified by the Company corporate deposits received
from time to time and accepted by the security trustee. 5. Interest income on inter 4,37.91 2,46.37
11. Auditors’ remuneration (excluding service tax): corporate deposits placed
Rs. in Lakhs
6. Service charges – income 69,80.66 57,78.39
Year ended Year ended
7. Sales incentives – income 30,83.82 17,39.17
March 31, March 31,
2009 2008 8. Service charges – expenditure 1.61 10.70
Audit fees 30.00 30.00 9. Rent – expenditure 2,18.69 1,38.76
Tax Audit Fees 5.00 4.00 * 10. Bank charges – expenditure 3,38.72 -
Other Services 1.06 0.80 * (includes unamortized charges)
Reimbursement of out of pocket expenses 0.72 0.33 11. Purchase of fixed assets - 28.06
* in respect of remuneration for professional services rendered by a firm of 12. Assignment of receivables (Purchased) 366,73.24 -
auditors in which some of the partners of the statutory auditors firm are Closing balances As at As at
partners. March March
12. Managerial remuneration: 31, 2009 31, 2008
Rs. in Lakhs Payables
Year ended Year ended Inter Corporate Deposits 20,00.00 -
March 31, March 31,
Others 3,97.32 1,35.82
2009 2008
Receivables 56,28.34 21,20.11
a) Remuneration to the Managing
director/ Manager: Bank guarantees given on our behalf 135,73.89 -
Salary, bonus etc. 42.00 32.12
Contribution to provident / - 2.00
superannuation funds, etc.
Estimated expenditure on perquisites - 1.30
b) Directors’ sitting fees 8.40 2.85

12
(b) Fellow subsidiaries Particulars Gratuity Compen- Post emplo- Bhavishya
Rs. In Lakhs sated yment Kalyan
absences medicare Yojana
Sr. Particulars Year ended Year ended scheme
No. March 31, March 31, III Net asset / (liability)
2009 2008 recognised in the
1. Inter corporate deposits received – TELCON - 20,00.00 balance sheet as at
respective year ends and
2. Inter corporate deposits received – Sheba 28,00.00 30,50.00 experience adjustments
3. Interest on inter corporate deposits – TELCON - 2,22.50 1 Defined benefit obligation
4. Interest on inter corporate deposits – Sheba 123.99 86.69 March 31, 2009 (5,90.70) (2,09.01) (64.13) (93.39)
5. Service charges – income – TELCON - 14.07 March 31, 2008 (2,88.12) (3,07.92) (50.64) (92.35)
6. Service charges (Rent )– income – TMIBASL 2.06 - March 31, 2007 (2,51.19) (2,45.48) (1,27.22) (89.09)
7. Discounting charges – income - 2,34.57 2 Fair value of plan assets
(includes unamortized discount)- TELCON March 31, 2009 2,86.05
8. Commission – expenditure (includes 61.67 2,33.59 March 31, 2008 1,10.89 NA
unamortized commission) – CONCORDE March 31, 2007 2,72.26
9. Support service charges – TTL 7,25.71 7,30.65 3 Net asset / (liability)
recognised in balance
10. Purchase of pass through certificate- Sheba - 3,14.78 sheet
11. Repairs and maintenance – TELCON - 2.31 March 31, 2009 (3,04.65) (2,09.01) (64.13) (93.39)
Closing balances As at As at March 31, 2008 (1,77.23) (3,07.92) (50.64) (92.35)
March March March 31, 2007 20.97 (2,45.48) (1,27.22) (89.09)
31, 2009 31, 2008
4 Experience adjustments
Payables arising on
Sheba (Inter corporate deposit) 16,50.00 17,73.00 a) Plan liabilities [gain/(loss)]
CONCORDE 19.69 18.46
March 31, 2009 (32.83) (15.00) 2.39 44.53
TTL 93.16 1,06.85
March 31, 2008 (1,27.24) (54.43) - (18.76)
Receivables
March 31, 2007 Not Not Not Not
TMIBASL 0.75 11.43
Available Available Available Available
(c) Key management personnel - remuneration b) Plan assets [gain/(loss)]
Rs. in Lakhs March 31, 2009 0.47
Year ended Year ended March 31, 2008 1.10 Notapplicable
March 31, March 31, March 31, 2007 Not
2009 2008 Available
Mr. P. C. Bandivadekar - 35.42 IV Change in defined benefit
obligation (DBO) for the
Mr. Jose Peter - 50.80
year ended March 31,
Mr. Shyam Mani * 42.00 - 2009

* Also refer note on paragraph 12 above. 1 Present value of DBO at


beginning of year 2,88.12 3,07.92 50.64 92.35
15. Employee defined benefits 2,51.29 2,45.48 1,27.22 89.09
Defined benefit plans / long term compensated absences - as per actuarial 2 Current service cost 64.92 62.44 9.64 43.66
valuations as at March 31, 2009 35.64 38.46 50.01 28.29
Rs. in Lakhs 3 Interest cost 23.73 15.94 4.29 7.85
Particulars Gratuity Compen- Post emplo- Bhavishya 13.83 16.44 10.81 7.57
sated yment Kalyan 4 Past Service Cost 3,07.26 - - -
absences medicare Yojana - - - -
scheme 5 Actuarial (gains)/ losses (75.55) 63.59 0.01 (50.47)
I Components of expense 1,64.52 1,11.65 (1,37.40) (32.60)
recognised in the profit 6 Benefits paid (17.78) (2,40.88) (0.45) -
and loss account for the (1,77.16) (1,04.11) - -
year ended
7 Present value of DBO at
March 31, 2009
the end of the year 5,90.70 2,09.01 64.13 93.39
1 Current service cost 64.92 62.44 9.64 43.66
2,88.12 3,07.92 50.64 92.35
35.64 38.46 50.01 28.29
V Change in fair value of plan
2 Interest cost 23.73 15.94 4.29 7.85
assets for the year ended
13.83 16.44 10.81 7.57
March 31, 2009
3 Expected return on (15.25) - - -
1 Plan assets at beginning 1,10.89
plan assets (14.69) - - -
of year 2,72.26
4 Past Service Cost 3,07.26 - - -
2 Expected return on plan assets 15.25
- - - -
14.69
5 Actuarial losses/(gains) (76.02) 63.59 0.01 (50.47)
3 Actual Company contributions 1,77.22
1,63.42 1,11.65 (1,37.40) (32.60)
- Notapplicable
6 Total eexp
xp ense rrec
xpense ec
ecoognised
4 Actuarial gains/(loss) 0.47
in the Profit and 3,04.64 1,41.97 13.94 1.04
1.10
Loss account 1,98.20 1,66.55 (76.58) 3.26
5 Benefits paid (17.78)
II Actual contribution and
(1,77.16)
benefit payments for
the year ended 6 Plan assets at the end of year 2,86.05
March 31, 2009 1,10.89
1 Actual benefit payments 17.78 240.88 0.45 -
1,77.16 1,04.11 - -
2 Actual contributions 1,77.22 - - -
- - - -

13
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

VI Actuarial assumptions 17. a) Income tax – Current is net of reversal of excess provision in respect of
earlier years Rs. 4,50.00 lakhs (previous year : Rs. Nil)
1 Discount rate 8.50% 8.50% 8.50% 8.50%
b) Major components of deferred tax arising on account of timing difference
8.50% 8.50% 8.50% 8.50%
2 Expected rate of return on 8.00 %
Rs. in Lakhs
plan assets 8.00% NA Particulars As at (Charge)/ As at
March 31, Creditfor March 31,
3 Salary escalation 5% to 7.5% 5% to 7.5% NA 5% to 7.5% 2008 the year 2009
5% to 8.5% 5% to 8.5% NA 5% to 8.5% Assets
4 Medical cost inflation NA 4.00% NA Provision for doubtful debts and 21,17.24 79,33.06 100,50.30
4.00% provision for expected loss on
5 Mortality – Indian assured future securitized receivables
lives mortality LIC (1994-96) Provision in respect of liability for - 6,65.75 6,65.75
ultimate servicing assigned receivables
VII Effect of one percentage One percentage One percentage Retirement benefits/expenses 65.38 5.66 71.04
point change in assumed point increase in point decrease in allowable on payment basis
medical inflation rate medical inflation medical inflation Others 8.66 10.48 19.14
rate rate
21,91.28 86,14.95 108,06.23
Revised DBO as at March 31, 2009 75.94 55.13
Liabilities
53.96 47.61
Revised service cost for 2008-2009 10.22 9.10 DMA Commission claimed on (6,54.06) (9,90.81)* (16,44.87)
51.08 41.91 incurrence basis
Revised Interest cost for 2008-2009 4.57 4.03 Depreciation (1,63.85) (92.01) (2,55.86)
10.11 7.17 (8,17.91) (10,82.82) (19,00.73)
Notes Net deferred tax Asset / (liability) 13,73.37 75,32.13 * 89,05.50
1. Defined Contribution Plans – The Company’s contribution to defined * Net of charge in respect of earlier years Rs. 16,67.80 lakhs
contribution plan aggregating Rs. 3,69.10 lakhs (2007-08 Rs. 2,58.17 Note:
lakhs) for the year ended March 31, 2009 has been recognised in the
Profit and Loss Account. Notwithstanding the losses in the current financial year, deferred tax assets
have been recognized since the management is reasonably certain that there
2. The assumption of future salary increases, considered in actuarial would be sufficient future taxable income against which such deferred tax
valuation, take account of inflation, seniority, promotion and other assets would be realized based on the future estimate of the profits.
relevant factors, such as supply and demand in the employment market.
18. Capital to Risk Assets Ratio (CRAR)
3. The plan assets in respect of gratuity represents funds managed by the
insurers. The ratios calculated in accordance with the Reserve Bank of India guidelines
are as under :
4. Discount rate is based on government bond yields near to the year end
date (assuming no material change in the same). Particulars As at March 31, 2009 As at March 31, 2008
5. Figures in italics pertains to previous year. i) CRAR (%) 14.00 16.58
16. Disclosure in respect of operating leases: ii) CRAR - Tier I capital (%) 14.00 16.58
Rs. in lakhs iii) CRAR - Tier II capital (%) - -
Assets taken on Lease Year ended Year ended 19. Exposure to real estate sector
March 31, March 31, The Company does not have exposure to the real estate sector.
2009 2008
a) Total of minimum lease payments
Total of minimum lease payments
for a period:
Not later than one year 1,46.31 1,89.13
Later than one year and not later 20.61 1,66.60
than five years
b) Lease payments recognized in the 1,47.14 1,94.11
statement of profit and loss for the year
c) General Description of significant leasing agreements-
The Company has entered into operating lease arrangements
for commercial properties.

14
20. Maturity pattern of certain items of assets and liabilities
Rs. in Lakhs
1 day to Over One Over Two Over Three Over Six Over One Over Three Over Five Total
30/31 days months to months to months to months to year to year to years
(one month) Two months Three months Six months One year Three years Five years
Liabilities
Borrowingsfrom Banks/
Financial Institutions 451,25.00 203,12.50 535,00.00 709,37.50 2132,58.36 250,00.00 - - 4281,33.36
752,50.00 188,12.50 705,00.00 820,62.50 1422,48.50 382,50.00 - - 4271,23.50
MarketBorrowings 266,50.00 90,00.00 50,00.00 175,00.00 10,00.00 317,20.00 20,00.00 - 928,70.00
17,73.00 - - 19,60.00 - 617,20.00 - - 654,53.00
Assets
Advances 284,67.02 144,24.02 121,59.64 881,98.96 855,75.60 2761,89.73 586,76.18 51.79 5637,42.93
241,67.85 121,51.90 97,10.60 403,70.57 732,02.22 2738,79.05 871,21.30 1,54.84 5207,58.32
Investments 1,35.00 - - - 1,39.22 4,27.13 4,56.00 1,66.00 13,23.35
54.00 - - - - 5,92.54 3,93.00 4,11.00 14,50.54
Notes : Figures in italics pertains to previous year
21. Disclosure of loans and advances given to parent company, associates etc. (as certified by the management) as required by clause 28 of listing Agreement for
debt securities.
Rs. in Lakhs
Particulars Balance As At Maximum Balance for
the year ended
March 31, 2009 March 31, 2008 March 31, 2009 March 31, 2008
a) Loans and advances in the nature of loans to parent company,Tata Motors Limited - - 145,00.00 -
b) Loans and advances in the nature of loans to associates Not applicable
c) Loans and advances in the nature of loans where there is;
i) No Repayment schedule orrepayment beyond seven years; or
ii) No interest or interest below section 372A of the Companies Act, 1956. - - - -
d) Loans and advances in the nature of loans to firms/companies in which - - - -
directors are interested.
22. Figures as at March 31, 2008 and for the year ended on that date have been regrouped, wherever necessary.

For and on behalf of the Board of Directors


PR
PRAAVEEN PP.. K ADLE
KADLE
H. N. SINOR BHAR
BHARAAT VASANI
VINAY LLA
VINAY AVANNIS C. RAMAKRISHNAN
Deputy Company Secretary Directors
SHYAM MANI
SHYAM
Managing Director
Mumbai
Date: May 18, 2009

15
Third annual report 2008-09
TATA MOTORS FINANCE LIMITED
MOT

Assets side: (Contd.) Amount


Schedule to the Balance Sheet as at March 31, 2009 of a non-deposit taking non-
Outstanding
banking financial Company
Long Term In
erm Invvestmen ts:
estments:
(as required in terms of Paragraph 13 of Non-Banking Financial (Non-Deposit Accepting
or Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007.) 1 Quoted : -
(Rs. In lakhs) (i) Shares : (a) Equity -
Particulars (b) Preference -
Liabilities side: Amount Amount (ii) Debentures and Bonds -
Outstanding Overdue (iii) Units of mutual funds -
(1) Loans and advances availed by the (iv)Government Securities -
non-banking financial Company (v) Others (please specify) -
inclusive of interest accrued thereon
but not paid: 2 Unquoted:

(a) Debentures : Secured 617,20.00 - (i) Shares : (a) Equity -

: Unsecured - - (b) Preference -

(other than falling within the meaning (ii) Debentures and Bonds 10,96.00
of public deposits) (iii) Units of mutual funds -
(b) Deferred Credits - - (iv) Government Securities -
(c) Term Loans 1302,50.00 - (v) Others (please specify)
(d) Inter-corporate loans and borrowings 36,50.00 - Retained interest in securitization transaction 2,27.35
(e) Commercial Papers 275,00.00 - (5) Borrower group-wise classification of assets financed as in (2) and (3) above :
(f) Other Loans (specify nature) Amount net of provisions
- Working capital demand loan 840,00.00 - Category Secured Unsecured Total
- Cash Credit 1468,83.36 - 1 Related Parties
- From banks 630,00.00 - (a) Subsidiaries - - -
- From SICOM 40,00.00 (b) Companies in the same group - - -
Assets side: Amount (c) Other related parties - - -
Outstanding 2 Other than Related Parties 6662,42.53 90.84 6663,33.37
(2) Break-up of Loans and Advances including bills Total 6662,42.53 90.84 6663,33.37
receivables [other than those included in (4) below]:
(6) Investor group-wise classification of all investments (current and long
(a) Secured Refer 3(iii) below term) in shares and securities (both quoted and unquoted):
(b) Unsecured Category Market Value/ Book Value
(3) Break up of Leased Assets and stock on hire and Break up or fair (Net of
other assets towards AFC activities
value or NAV
NAV Provision)
(i) Lease assets including lease rentals under
1 Related Parties
sundry debtors :
(a) Subsidiaries - -
(a) Financial lease -
(b) Companies in the same group - -
(b) Operating lease -
(c) Other related parties - -
(ii) Stock on hire including hire charges under
sundry debtors : 2 Other than Related Parties
(a) Assets on hire - Total - -
(b) Repossessed Assets - (7) Other information
(iii) Other loans counting towards AFC activities Particulars
(a) Loans where assets have been repossessed 59,92.45 (i) Gross Non-Performing Assets
(b) Loans other than (a) above 6603,40.92 (a) Related parties -
(4) Break-up of Investments: (b) Other than related parties 798,68.28
Current Investments: (ii) Net Non-Performing Assets
1 Quoted : (a) Related parties -
(i) Shares : (a) Equity - (b) Other than related parties 502,99.88
(b) Preference - (iii) Assets acquired in satisfaction of debt -
(ii) Debentures and Bonds -
(iii)Units of mutual funds - For and on behalf of the
Board of Directors
(iv)Government Securities -
VINAY LLA
VINAY AVANNIS PR
PRAAVEEN P.K
P.K ADLE
.KADLE
(v) Others (please specify) -
Deputy Company Secretary H.N.SINOR
2 Unquoted:
BHAR
BHARA AT VASANI
(i) Shares : (a) Equity -
SHYAM MANI
SHYAM C. RAMAKRISHNAN
(b) Preference - Managing Director Directors
(ii) Debentures and Bonds -
(iii)Units of mutual funds -
(iv)Government Securities - Mumbai
(v) Others (please specify) - Date May 18, 2009

16
Additional Information as required under part IV of Schedule VI to Companies Act, 1956
B alanc
alancee SSheet
heet A bstr
Abstr ac
actt and ccompan
bstrac ompan
ompanyy ’s G ener
Gener al B
eneral usiness pr
Business ofile:
profile:
[Rs
[Rs.. ‘000]
I. Registration Details:

Registration No. U65923MH2006PLC162503

State Code 11

Balance Sheet Date 31-03-2009

II. Capital Raised during the year (See note below)

Public Issue NIL

Initial / Rights Issue 1,000,000

Bonus Issue NIL

Private Placement NIL

III. Position of Mobillisation and Deployment of Funds

Total Liabilities 65,715,470

Total Assets 65,715,470


Sources of Funds:

Paid-up Capital 8,500,000

Reserves and Surplus 5,115,134

Secured Loans 42,685,336

Unsecured Loans 9,415,000


Application of Funds

Net Fixed Assets 326,434

Investments 132,335

Deferred Tax Assets 890,550

Net Current Assets 63,615,043

Miscellaneous Expenditure 4,490

Debit Balance in Profit and Loss Account 746,618

IV
IV.. Performance of Company

Turnover / Income 9,199,394

Total Expenditure 10,818,569

Profit Before Tax (161,917,500)

Profit After Tax (1,207,150)

Earning Per Share - Basic (Rs.) (1.59)

Divident Rate NIL

V. General Names of Three Principal Products/Services of Company (as per monetary terms)

Item Code No. (ITC No.) Not Applicable

Product Description Asset Finance Company

17