Camlin Ltd, Regd. Off :- 9-B Nanddeep Industrial Estate, Kondivita Lane, J. B. Nagar,
Andheri(east) , Mumbai - 400 059

FOR THE ATTENTION OF COMPANY’S SHAREHOLDERS  

The Hon’ble High Court of Bombay has by its order dated November, 17 2006 sanctioned the scheme of Arrangement under Section 391 to 394 of the Companies Act, 1956 for the demerger of Fine Chemicals Division of the Company to Camlin Fine Chemicals Limited (Resulting Company).

Pursuant to the Scheme of Arrangement, the Assets & liabilities relatable to the Fine Chemicals Division have been transferred to the Resulting Company at the value appearing in the books of accounts of the company as on the Appointed Date (i.e. 1 st July, 2006).

The Company had fixed February, 19 2007 as the Record Date inter alia to determine the Shareholders entitled to issuance of Shares of the Resulting Company Accordingly the Resulting Company has vide Board resolution dated February, 22 2007 allotted shares to the shareholders of the company pursuant to the scheme against your existing holding in Camlin and the new Shares will be allotted to you by CFCL.

This Notice is issued to inform the Shareholders the implication as to the tax treatment (Capital Gains) in respect of shares issued pursuant to demerger based on an opinion received by the Company .The company has been advised that :-:

a) There would be no Capital Gains implication on the shareholders of Camlin in view of the exemption granted u/s. 47 (vid), of the Income Tax Act, 1961 (“the Act”).

b) In respect of shares issued, consequent to the demerger, by CFCL, the date of acquisition for the purpose of computing Capital Gains in the case of a shareholder will be the date of acquisition of the shares of Camlin in his own case. This is because of the specific provisions of Clause (g) in Explanation 1 to Section 2 (42A) of the Act.

For the purpose of determining the post Demerger cost of acquisition of Equity Shares of Camlin and the Resulting Company under the Act, the shareholders are advised to apportion their pre-demerger cost of acquisition of Camlin’s shares in the following proportion.

This communication is sent for the benefit of the shareholders and the company takes no express or implied liability in providing this guidance

Yours faithfully,

FOR CAMLIN LIMITED

Ravindra Damle
G.M (Corporate) &
Company Secretary.