Tata Motors AR

1) PREAMBLE

The Securities Exchange Board of India (SEBI) vide its notification

dated July 08, 2016 has amended the SEBI (Listing Obligations

and Disclosure Requirements) Regulations, 2015 (“

SEBI LODR

”),

by inserting Regulation 43A, making it mandatory for the top 500

listed Companies based on the market capitalization (calculated

as on March 31 of every financial year) to formulate a Dividend

Distribution Policy, which will be disclosed in their annual report

and on their website.

Tata Motors Limited being one of the top 500 listed companies

as per the criteria mentioned above, has framed a Dividend

Distribution Policy (“

Policy

”). This policy has been adopted by

the Board of Directors of the Company at its meeting held on

May 23, 2017, being the effective date of this Policy.

2) SCOPE AND OBJECTIVE

This Policy seeks to lay down a broad framework for the

distribution of dividend by the Company whilst appropriately

balancing the need of the Company to retain resources for the

Company’s growth & sustainability. Through this policy, the

Company also endeavors to maintain fairness and consistency

while considering distributing dividend to the shareholders.

The Policy sets out the circumstances and different factors for

consideration by the Board at the time of taking a decision on

distribution or retention of profits, in the interest of providing

transparency to the shareholders.

The Policy is not an alternative to the decision of the Board for

recommending dividend, which is made every year after taking

into consideration all the relevant circumstances enumerated

hereunder or other factors as may be considered relevant by the

Board.

The Policy is being recommended for adoption by the Board of

Directors of all the Companies in the Tata Motors Group i.e. by all

its subsidiaries and to the extent possible, the joint ventures after

discussions with its partners.

3) STATUTORY REQUIREMENTS

This policy on dividend distribution shall be in accordance with

the provisions of the Companies Act, 2013, read with applicable

rules framed thereunder, as may be in force for the time being

(“

Act

”), SEBI ( Listing Obligations and Disclosure Requirements)

Regulations, 2015, (“

SEBI LODR

”), such other applicable

provisions of law.

4) DEFINITIONS

“Act” shall mean the Companies Act, 2013 including the

Companies (Declaration and Payment of Dividend) Rules,

2014, as amended from time to time.

“Applicable Laws” shall mean the Companies Act, 2013 and

Rules made thereunder, the Securities and Exchange Board

of India (Listing Obligations and Disclosure Requirements)

Regulations, 2015 together with the circulars issued

thereunder; as amended from time to time and such other

act, rules or regulations which deals with the distribution of

dividend.

“Board” or “Board of Directors” shall mean Board of Directors

of the Company.

“Company” shall mean “Tata Motors Limited” or “TML”.

“Dividend” includes any interim dividend as defined under

the Companies Act, 2013.

“Free Reserves” shall means such reserves which, as per the

latest audited balance sheet of a Company, are available for

distribution as dividend:

Provided that -

(i) any amount representing unrealized gains, notional

gains or revaluation of assets, whether shown as reserves

or otherwise, or

(ii) any change in carrying amount of an asset or of a liability

recognized in equity, including surplus in profit and loss

account on measurement of the asset or the liability at

fair value, shall not be treated as free reserves.”

“SEBI LODR” shall mean Securities and Exchange Board of

India (Listing Obligations and Disclosure Requirements)

Regulations, 2015 together with the circulars issued

thereunder; as amended from time to time.

“Policy” or “this Policy” shall mean the Dividend Distribution

Policy.

5) STATUTORY PROVISIONS RELATING TO DISTRIBUTION

OF DIVIDEND

In accordance with the provisions of the Act, dividend shall be

declared or paid only:

A. Out of distributable profits of current year or previous

financial years:

(i) Current financial year’s profit after tax of standalone

financial statement as per applicable Accounting

Standards:

(a) after providing for depreciation in accordance with

Applicable laws and regulations; and

(b) after transferring to reserves such amount as may

be prescribed or as may be otherwise considered

appropriate by the Board at its discretion;

(ii) Profits for any previous financial year(s):

a) after providing for depreciation in accordance with

Applicable Laws and regulations; and

b) remaining undistributed;

(iii) A combination of (i) & (ii) above;

B. Out of free reserves – in the event of inadequacy/

absence of profits

In the event of inadequacy or absence of profits in any

DIVIDEND DISTRIBUTION POLICY