Mar 31, 2018
Authorization of financial statements:
The Standalone Financial Statements were authorized for issue in accordance with a resolution passed in meeting of Board of the Directors held on 24th May, 2018.
Notes to Standalone Financial statements for the year ended 31st March 2018
Note 1 - Corporate Information
20 Microns Limited (âCompanyâ) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The registered office of the Company is located at 9 - 10, GIDC, Waghodia, Vadodara -391760, Gujarat, India.
The Company is engaged in Business of Industrial MicronisedMinerals and Speciality Chemicals.
Note 2 - Recent accounting pronouncements
Ministry of Corporate Affairs (âMCAâ) through Companies (Indian Accounting Standards) Amendment Rules, 2018 has notified the following new and amendments to Ind ASs which the Company has not applied as they are effective for annual periods beginning on or after April 1, 2018:
Ind AS 115 Revenue from Contracts with Customers Ind AS 21 The effect of changes in Foreign Exchange rates Ind AS 115- Revenue from Contract with Customers:
Ind AS 115 establishes a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers. Ind AS 115 will supersede the current revenue recognition standard Ind AS 18 Revenue, Ind AS 11 Construction Contracts when it becomes effective.
The core principle of Ind AS 115 is that an entity should recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Specifically, the standard introduces a 5-step approach to revenue recognition:
- Step 1: Identify the contract(s) with a customer
- Step 2: Identify the performance obligation in contract
- Step 3: Determine the transaction price
- Step 4: Allocate the transaction price to the performance obligations in the contract
- Step 5: Recognise revenue when (or as) the entity satisfies a performance obligation
Under Ind AS 115, an entity recognises revenue when (or as) a performance obligation is satisfied, i.e. when âcontrolâ of the goods or services underlying the particular performance obligation is transferred to the customer.
Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entityâs contracts with customers. The standard permits two possible methods of transition:
- Retrospective approach - Under this approach the standard will be applied retrospectively to each prior reporting period presented in accordance with Ind AS 8- Accounting Policies, Changes in Accounting Estimates and Errors
- Retrospectively with cumulative effect of initially applying the standard recognized at the date of initial application (Cumulative catch - up approach)
The Company has completed its evaluation of the possible impact of Ind AS 115 and the effect on adoption of Ind AS 115 is expected to be insignificant.
Ind AS 21 - The effect of changes in Foreign Exchange rates
The amendment clarifies on the accounting of transactions that include the receipt or payment of advance consideration in a foreign currency. The appendix explains that the date of the transaction, for the purpose of determining the exchange rate, is the date of initial recognition of the non-monetary prepayment asset or deferred income liability. If there are multiple payments or receipts in advance, a date of transaction is established for each payment or receipt. Company is evaluating the impact of this amendment on its financial statements.
3.1 The balances in dividend accounts are not available for use by the Company and the money remaining unpaid will be deposited in the Investor Protection and Education Fund after the expiry of 7 years from the date they became due for payment. No amount is due at the end of the period for credit to Investor Protection and Education fund.
4.1 Terms/ rights attached to equity shares
i The Company has only one class of shares referred to as equity shares having a par value of Rs. 5 each.
ii Each holder of equity shares is entitled to one vote per share which can be exercised either personally or by an attorney or by proxy.
iii The dividend proposed if any by the Board of Directors is subject to approval of the shareholders in the ensuing general meeting except in the case of interim dividend.
iv In the event of liquidation of the Company, the holders of equity shares shall be entitled to receive assets of the Company, after distribution of all preferential amounts. The amount distributed will be in proportion to the number of equity shares held by the shareholders.
4.2 The Company has not bought back any equity shares, has not allotted any shares as fully paid up pursuant to contracts without payment being received in cash and has not allotted bonus shares, for the period of five years immediately preceding March 31, 2018
Nature and purpose of reserves :
i General reserve
The general reserve is used from time to time to transfer profits from retained earnings for appropriation purpose. As the general reserve is created by transfer from one component of equity to another and is not an item of other comprehensive income, items included in the general reserve will not be reclassified subsequently to profit and loss.
ii Equity instrument through OCI
The Company has elected to recognise changes in the fair value of certain investments in equity securities in other comprehensive income. These changes are accumulated within the Equity instrument through OCI reserve within equity.
*Amount disclosed under the head âCurrent financial liabilities : Othersâ (Note 25)
The Company does not have any continuing defaults in repayment of loans and interest as at the reporting date.
Maturity Profile of Borrowings [ as at March 31, 2018 ]
Secured Borrowings
The principal amount of the loans to each of the lenders shall be repayable in equated monthly instalments ranging over a period from 36 months to 72 months. The repayment scheduled as per the sanction terms for sanction amounts of loans is as under:
Details of Securities
The term loans obtained as consortium loans are secured by way of
1 First pari-passu charge by way of mortgage / hypothecation over :
i. Plot No. 157 Mamura, Bhuj (admeasuring 3.20 acres )
ii. Negative lien on Plot No. 158,156,149 of Mamuara, Bhuj (admeasuring 74399 sq.mtrs.)
iii. Plot No. 172,174 & 175, Vadadala, Baroda (admeasuring 03.00.01 hectares)
iv. Plot No. F-75/76/82/85 & H-83/84, RIICO I.A., Swaroopganj, Rajasthan (admeasuring 9,457.50 sq.mtrs.)
v. 307/308, Arundeep Complex, Race Course, Baroda (admeasuring 1,405 super built up area)
vi. 134,135 1st Floor, Hindustan Kohinoor Ind. Complex, LBs Marg, Vikhroli (W), Mumbai (admeasuring 870 sq. ft.)
vii. Plot No. B-77 (Admeasuring 8825 sq. mts.) and B-78 (Admeasuring 8480 sq. mts), Matsya Industrial Area, Alwar, Rajasthan.
viii. Plot no. 253-254 (area 3000 sq.mtrs.) GIDC, Waghodia
ix. Plot no.23 & 24 (area 3.29 acre), SIPCOT Industrial Estate, Phase-II, Hosur, Krishnagiri, Tamil Nadu
x. Plot no.104/3 of land located at survey no 65, village Puthur, Tirunvelli, Tamil Nadu (admeasuring 20,261 sq.mtrs.)
xi. Plot No. F 140, Alwar, Rajasthan
xi Plant and machinery, both present and future, wherever situated at all factories and premises pertaining to above locations.
2 Second pari-passu charge by way of mortgage / hypothecation over :
Current assets, both present and future, wherever situated, but pertaining to the division/factory/premises at Vadadala, Waghodia and Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
3 All the term loans are further collaterally secured by personal guarantee of Executive Chairman, CEO and Managing Director, of the companyand corporate guarantee by âEriez Industries Private Limitedâ ( Previously known as Eriez Finance & Investment Limited ), a company where significant influence exists and pledge of entire shareholding of promoters of the Company i.e. of 85,00,547 shares including 15,50,235 unencumbered shares of Corporate Promoter being âEriez Industries Private Limited ( Formerly known as â Eriez Finance and Investment Limitedâ)
4 Term loans of Rs. 214.07 Lakhs (31/03/2017: Rs. 124.51 Lakhs,01/04/2016 : Rs. 47.90 Lkahs ) obtained for acquisition of assets (vehicles) are secured only by the hypothecation of the respective assets financed.
The company offsets tax assets and liabilities if and only if it has a legally enforceable right to set off current tax assets and current tax liabilities and the deferred tax assets and deferred tax liabilities relate to income taxes levied by the same tax authority.
Significant management judgment is required in determining provision for income tax, deferred income tax assets and liabilities and recoverability of deferred income tax assets. The recoverability of deferred income tax assets is based on estimates of taxable income by each jurisdiction in which the relevant entity operates and the period over which deferred income tax assets will be recovered.
Current Assets, both present and future, wherever situated, but pertaining to the division/factory/premises at Vadadala, Waghodia and Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
Second pari-passu charge on factories and premises and plant and machineries, both present and future, wherever situated, but pertaining to the locations stated in note 20.
The working capital finance facilities are further collaterally secured by personal guarantee ofExecutive Chairman, CEO and Managing Director, Managing Director of the companyand corporate guarantee by âEriez Industries Private Limitedâ, a company where significant influence exists and pledge of entire share holding of promoters of the company i.e. of 85,00,547 shares including 15,50,235 unencumbered shares of corporate promoter being âeriez Industries Private Limitedâ (Formerly known as âEriez Finance and Investment Limitedâ)
5.1 The balance with the bank for unpaid dividend is not available for use by the Company and the money remaining unpaid will be deposited in Investor Protection and Education Fund u/s 124(5) of Companies Act, 2013 after the expiry of seven years from the date of declaration of dividend. No amount is due at the end of the period for credit to Investors education and protection fund.
6.1 Company has entered into a settlement agreement with one of the supplier in respect of winding up petition filled by the supplier pending before honâble High Court of Gujarat. As per the agreement company has agreed to make payment of Rs. 65.59 lakhs in excess of liability in Books of Accounts to the supplier towards settlement as against which supplier accepts to irrevocably release and waive the all claims and entitlements. (Refer Note 41.2(a))
6.2 The monetary ceiling under the payment of Gratuity Act, 1972 was enhanced from Rs. 10,00,000 to Rs. 20,00,000 with effect from March 29, 2018. The enhanced gratuity liability of Rs. 85.26 Lakhs due to change in monetary ceiling of gratuity as per the law has been shown as exceptional item.
7 Earning per Share -(EPS)
Earnings per equity share of FV of Rs. 5 each
Basic EPS amounts are calculated by dividing the profit for the year attributable to equity holders of the Company by the weighted average number of Equity shares outstanding during the year. Diluted EPS amounts are calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of Equity shares outstanding during the year plus the weighted average number of Equity shares that would be issued on conversion of all the dilutive potential Equity shares into Equity shares.
8.1 Claims against the company not acknowledged as debt
a In the previous year, the Company had received Notice from the Honâble High Court of Gujarat intimating that one of the supplier had filed a winding-up petition against the Company for non-payment of outstanding dues of the supplier of Rs. 541.98 Lakhs. The company had filed a response with the Honâble High Court of Gujarat stating that the outstanding dues were not paid due to unresolved issues with the supplier for shortfall in material dispatch, default in payment of cost & freight to shipper, detention charges, default towards issuance of telex/ bill of lading, etc., and the matter is sub judicial. The company had provided for the said liability to the extent of Rs. 319.24 Lakhs in the books of account in prior years and the difference of amount claimed by supplier and provision made by the company has been reflected in contingent liability for the FY 2016-17. However, the Company has entered into a settlement agreement with the supplier in the month of April 2018, according to which the company is required to make additional payment of Rs. 65.59 Lakhs which has been provided in the books of accounts in the financial year 2017-18 as litigation settlement expenses (Refer note 37.1). Therefore there is no contingent liability as at March 31, 2018 in respect of the said matter.
b The Company had received an Order dated 06th August, 2016, from Geology and Mining Department, Bhuj, Kutch for excavating the mine beyond the approved lease area, situated at Survey No. 483, Mamuara, Bhuj, Kutch whereby a penalty of Rs. 419.13 lakhs is levied on the Company. Company had filed an appeal against the order of the Geology and Mining Department with the appellate authority as per the rules of Gujarat Mineral (Prevention of Illegal Mining, Transportation and Storage) Rules, 2005. The appellate authority, vide its order dated 17th September, 2016 has given Interim Stay against the aforesaid order issued by Geology and Mining Department, Bhuj, Kutch and further ordered to resume mining activity. The matter is pending for hearing before appellate authority.
c In terms of loan arrangement with the lenders, the lenders have right to recompense the reliefs/sacrifice/waiver/ concession extended to the company over the tenor of restructuring done in earlier years. The liability with respect to the same cannot be ascertained.
B) CONTINGENT ASSETS
The company is having certain claims which are pursuing through legal processes. The Management believe that probable outcome in all such claims are uncertain. Hence, the disclosure of such claims is not required in the financial statements.
C) CAPITAL COMMITMENTS
Estimated amount of contracts remaining to be executed on capital account, not provided for amounting to Rs. 256.40 Lakhs (Net of Advance Rs. 828.75 Lakhs [31.03.2017 Rs. 6.96 lakhs (Net of Advances of Rs. 1360.94 lakhs) [01.04.2016 Rs. 27.97 lakhs (Net of Advances of Rs. 792.46 lakhs)]
Investment in subsidiaries are carried at cost.
# Fair value of financial assets and liabilities which are measured at amortised cost is not materially different from the carrying value (i.e...amortised cost).
Level 1: Level 1 hierarchy includes financial instruments measured using quoted prices.
Level 2: The fair value of financial instruments that are not traded in an active market (for example, traded bonds, over-the counter derivatives) is determined using valuation techniques which maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.
Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3. This is the case for unlisted equity securities included in level 3.
B. Measurement of fair values
i) Valuation techniques and significant unobservable inputs
The fair value of investment in equity shares of other entity is determined based on market value of the shares. The approach taken for valuation is Book value of the equity instruments which is further adjusted for market value of the investments made by the investee company.
Financial instruments measured at fair value - FVTOCI in unquoted equity shares
ii) Transfers between Levels 1 and 2
There have been no transfers between Level 1 and Level 2 during the reporting periods
iii) Level 3 fair values
Movements in the values of unquoted equity instruments for the period ended 31st March 2018, 31 March 17 and 1 April 16 is as below:
Transfer out of Level 3
There were no movement in level 3 in either directions during the year ended 31st March 2018 and the year ended 31st March 2017.
Ind AS 101 allows an entity to designate certain investments in equity instruments as fair valued through the OCI on the basis of the facts and circumstances at the transition date to Ind AS.The Company has elected to apply this exemption for its investment in equity shares.
Sensitivity analysis
Based on the valuation report for investments in unquoted shares, the sensitivity as as 31st March 2018 is provided below.
C. Financial risk management
The Company has exposure to the following risks arising from financial instruments:
- Credit risk;
- Liquidity risk; and
- Market risk
i. Risk management framework
The Companyâs board of directors has overall responsibility for the establishment and oversight of the Companyâs risk management framework. The Company has a well-define Risk Management framework for reviewing the major risks and taking care of all the financial risks. The risk management framework aims to :
a. create a stable business planning environment by reducing the impact of currency and interest rate fluctuation on companyâs business plan.
b. achieve greater predictability to earnings by determining the financial value of the expected earning in advance. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Companyâs activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
The audit committee oversees how management monitors compliance with the companyâs risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The audit committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the audit committee. The Board of Directors reviews and agrees policies for managing each of these risks.
ii. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Companyâs receivables from customers and investments in debt securities and loans given.
The carrying amount of following financial assets represents the maximum credit exposure:
(a) Cash and Cash equivalent and Other Bank Balances
The company maintains its Cash and cash equivalents and Bank deposits with banks having good reputation, good past track record and high quality credit rating and also reviews their credit-worthiness on an on-going basis.
(b) Trade and other receivables
The Companyâs exposure to credit Risk is the exposure that Company has on account of goods sold or services rendered to a contractual counterparty or counterparties, whether with collateral or otherwise for which the contracted consideration is yet to be received.The Companyâs major customer base is paints, plastic, rubber and other misc. industries.
The Commercial and Marketing department has established a credit policy.
The Company raises the invoice based on the quantities sold.The Company provides for allowance for impairment that represents its estimate of expected losses in respect of trade and other receivables.
For trade receivables, as a practical expedient, the Company computes credit loss allowance based on a provision matrix. The provision matrix is prepared based on historically observed default rates over the expected life of trade receivables and is adjusted for forward-looking estimates.
Assets are written off when there are no reasonable expectation of recovery such as debtor declaring bankruptcy or failing to engage in a repayment plan with group. Where receivables have been written off the company continues to engage in enforcement activity to attempt to recover the receivables. where recoveries are made, these are recognised in profit and loss.
The maximum exposure to the credit risk at the reporting date from Trade Receivable is as amounts mentioned in Note No. 11
The impairment provisionsabove are based on management judgment / assumptions about risk of default and expected loss rates. The Company uses judgment in making these assumptions and selecting the inputs to the impairment calculation, based on the companyâs past history as well as forward looking estimates at the end of each reporting period.
(c) Loans and deposits
Company has given loans to employees and security deposits. The maximum exposure to the credit risk at the reporting date from Loans given amounts to Rs. 101.29 Lakhs on March 31, 2018, Rs. 102.33 Lakhs on March 31, 2017 and Rs. 55.81 Lakhs on April 01, 2016.
iii. Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companyâs approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companyâs reputation.
The Company maintains the following lines of credit outstanding:
(a) Term loans from banks and financial institution of Rs. 5733.06 Lakhs (at amortised cost) that is secured as mentioned in Note 20. Interest would be payable at the rate of varying from 9.35% to 16%.
(b) The company has also accepted deposit from share holders and directors amounting to Rs. 2388.30 Lakhs (at amortised cost) of unsecured nature. Interest would be payable at the rate of varying from 10.25% - 13.62%.
(c) For maintaining working capital liquidity company avails cash credit limit from bank. The amount availed as at 31/03/2018 is Rs. 4734.84 Lakhs (at amortised cost). The said loan is having rate of interest of 12.25%.
Exposure to liquidity risk
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted, and exclude the impact of netting agreements.
The gross inflows/(outflows) disclosed in the above table represent the contractual undiscounted cash flows relating to non-derivative financial liabilities held for risk management purposes and which are not usually closed out before contractual maturity.
iv. Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other price risk, such as equity price risk and commodity risk. Financial instruments affected by market risk include loans and borrowings, deposits and FVTOCI investments.
a) Currency risk
The functional currency of the Company is Indian Rupee. The Company have transaction of import of materials, other foreign expenditures and export of goods. hence the company is exposed to currency risk on account of payables and receivables in foreign currency. Company have outstanding balances in Euro, USD and GBP
Sensitivity analysis
Profit or loss is sensitive to higher/lower Exchange rate of currency. A possible 5% change in exchange rate would affect profit/loss at the reporting date by amount shown below:
b) Interest rate risk
Interest rate risks is measured by using the cash flow sensitivity for changes in variable interest rates. Any movement in the reference rates could have an impact on the Companyâs cash flows as well as costs. The Companyâs interest rate exposure is mainly related to debt obligation. On period under review the Company do not have any term loans at fixed rate andhas not entered into interest rate swaps for its exposure to long term borrowings at floating rate. The company have accepted deposits from share holders which are fixed rate instruments.
Sensitivity analysis
Profit or loss is sensitive to higher/lower interest expense from borrowings as a result of change in interest rates
Based on the composition ofdebt a reasonably possible change of 100 basis points in interest rates at the reporting date would have increased (decreased) Equity and Profit or Loss by the amount shown below:
c) Commodity Price Risk
Commodity price risk arises due to fluctuation in prices of raw Material and other consumables. The company has risk management framework aimed at prudently managing the risk arising from the volatility in commodity prices and freight costs.
The companyâs commodity risk is managed centrally through well established trading operations and control processes.
d) Equity Price Risk
The Company do not have any investment in quoted equity shares hence not expose to equity price risk.
9 Capital Management
The Companyâs objectives when managing capital are to
- safeguard their ability to continue as a going concern, so that they can continue to provide returns for shareholders and benefits for other stakeholders, and
- Maintain an optimal capital structure to reduce the cost of capital.
The Company determines the amount of capital required on the basis of the annual business plan coupled with long term and short term strategic investments and expansion plans. The funding needs are met through equity, cash generated from operations, long terms and short term bank borrowings and deposits.
The Company monitors capital using a ratio of âadjusted net debtâ to âadjusted equityâ. For this purpose, adjusted net debt is defined as total liabilities, comprising interest-bearing loans and borrowings, less cash and cash equivalents. Adjusted equity comprises all components of equity.
10 Disclosure of Employee Benefits
The Company has implemented Ind AS - 19 on âEmployee Benefitsâ.
(a) Provident Fund - Defined Contribution Plan
All employees are entitled to provident fund benefits and amount charged to Statement of Profit and Loss during the period of 12 months ended is Rs. 161.27 Lakhs (Previous year Rs. 32.30 Lakhs)
(b) Gratuity and Leave Encashment - Defined Benefit Plans (payable in future)
Provision has been made for gratuity and leave encashment as per actuarial valuation. The principal assumptions used in actuarial valuation and necessary disclosures are as below:
(i) Entity responsibilities for the governance of the plan Risk to the Plan
Following are the risk to which the plan exposes the entity :
A Actuarial Risk:
It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons:
Adverse Salary Growth Experience: Salary hikes that are higher than the assumed salary escalation will result into an increase in Obligation at a rate that is higher than expected.
Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption than the Gratuity benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate.
Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption than the Gratuity benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.
B Investment Risk:
For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.
C Liquidity Risk:
Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign / retire from the company there can be strain on the cash flows. D Market Risk:
Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate / government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.
E Legislative Risk:
Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation / regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.
(ii) The company has participated in Group Gratuity Scheme Plan with SBI Life insurance to meet its gratuity liability. The present value of the plan assets represents the balance available at the end of the year.
(b) The trustees of the plan have outsourced the investment management of the fund to an insurance company. The insurance company in turn manages these funds as per the mandate provided to them by the trustees and the asset allocation which is within the permissible limits prescribed in the insurance regulations. Due to the restrictions in the type of investments that can be held by the fund, it may not be possible to explicitly follow an asset-liability matching strategy to manage risk actively in a conventional fund.
(g) Other Notes:
(i) The expected rate of return on Plan Assets is determined considering several applicable factors, mainly the composition of Plan Assets held, assessed risks, historical results of return on Plan Assets and the Companyâs policy for the Plan Assets management.
(ii) The actuarial valuation takes into account the estimates of future salary increases, inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market. The management has relied on the overall actuarial valuation conducted by the actuary.
Notes
1 The following are the list of Independent Directors with whom no transaction have been occurred during the Financial Year 2017-18 other than payment of sitting fees:
a) Mr. Pravinchandra M Shah
b) Mr. Ram Devidayal
c) Mr. Atul Patel
d) Dr. Ajay Ranka
2 20 Microns Nano Minerals Ltd, 20 Microns SDN BHD, 20 Microns FZE have been using software package being âSAPâ by 20 Microns Limited without payment of Consideration.
11 Segment Reporting
The Company primarily operates in the segment of Micronized Minerals. The MD/CEO of the Company allocate resources and assess the performance of the Company, thus are the Chief Operating Decision Maker (CODM). The CODM monitors the operating results of the business as a one, hence no separate segment need to be disclosed.
a) Information about product and services:
Sale of Minerals : Rs. 38718.08 Lakhs
Sale of Herbal Products : Rs. 18.81 Lakhs
Sale of Construction Chemicals : Rs. 30.47 Lakhs
b) Information about geographical areas:
1. The Company have revenues from external customers attributable to all foreign countries amounting to Rs. 5193.48 Lakhs and entityâs country of domicile amounting to Rs. 33573.88 Lakhs.
2. None of the companyâs Non Current assets are located outside India hence entity wide disclosure is not applicable to the Company.
c) Information about major customers:
There is three customers to the company which accounts for more than 10% of aggregate sales. Net sales made to this customer amounts to Rs. 15,854.38/- lakhs.
12 RESEARCH AND DEVELOPMENT EXPENDITURE
The company has incurred expenses during the year for research and development of product of the company. The break up of research and development expenses grouped under various head are as under :
13 Transition to Ind AS:
These financial statements, for the year ended 31 March 2018, are the first the company has prepared in accordance with Ind AS. For periods up to and including the year ended 31 March 2017, the company prepared its financial statements in accordance with IGAAP, including accounting standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended).
The accounting policies set out in note 1 have been applied in preparing the financial statements for the year ended 31 March 2018, the comparative information presented in these financial statements for the year ended 31 March 2017 and in the preparation of an opening Ind AS balance sheet at 1 April 2016 (the âtransition dateâ).
In preparing the opening Ind AS balance sheet, the company has adjusted amounts reported in financial statements prepared in accordance with IGAAP An explanation of how the transition from IGAAP to Ind AS has affected our financial performance, cash flows and financial position is set out in the following tables and the notes that accompany the tables. On transition, we did not revise estimates previously made under IGAAP except where required by Ind AS.
A Exemptions and exceptions availed
Set out below are the applicable Ind AS 101 optional and mandatory exceptions applied in the transition from IGAAP to Ind AS.
A1 Ind AS optional exemptions A1.1 Business Combination
Ind AS 101 permits an entity to apply the requirements of Ind AS 103 - Business combinations (Ind AS 103) prospectively from the transition date or opt for retrospective application of Ind AS 103. Retrospective application could be either done since inception or from a date determined by the management. The exemption for past business combinations also applies to past acquisitions of investments in associates, interests in joint ventures and interests in joint operations in which the activity of the joint operation constitutes a business, as defined in Ind AS 103. Accordingly, the company has elected not to restate past business combinations with an acquisition date prior to the transition date.However, any consequential deferred tax adjustments as required by Ind AS) have been duly considered. An explanation of the same has been provided in the note no. 53.10 subsequently.
A1.2 Leases
Ind AS 101 permits an entity to assess whether a contract or an arrangement contains a lease on the basis of facts and circumstances existing at the transition date to Ind AS. The Company has elected to apply this exemption for such contracts/arrangements.
A1.3 Effect of Changes in Exchange rate
In respect of long term foreign currency monetary items recognised in the financial statements for the period ending immediately before the beginning of the first ind AS Financial reporting period, the company has elected to recognise exchange differences on translation of such long term foreign currency monetary items in line with its previous GAAP accounting policy. In respect of long term foreign currency monetary items recognised in the financial statements beginning with the first Ind AS financial reporting period, exchange differences are recognised in the statement of profit and loss.
A1.4 Recognition of financial instruments through OCI
Ind AS 101 allows an entity to designate certain investments in equity instruments as fair valued through the OCI on the basis of the facts and circumstances at the transition date to Ind AS.
The Company has elected to apply this exemption for its investment in equity instruments other than subsidiary. A1.5 Disclosure of investments in subsidiaries
Under, Ind AS 101 an entity can determine the value of investment in a subsidiary, associate or joint arrangement as either of the below:- Cost determined in accordance with Ind AS 27 (i.e. retrospective application of Ind AS 27)
- Fair value at the entityâs date of transition to Ind AS
- Previous GAAP carrying amount
Accordingly, if an entity chooses to measure its investment at fair value at the date of transition then that is deemed to be cost of such investment for the company and, therefore, it shall carry its investment at that amount (i.e. fair value at the date of transition) after the date of transition.
The Company has elected to carry forward the fair value as deemed cost for investment in equity shares of subsidiaries in the standalone financial statements.
A2 Mandatory Exceptions A2.1 Estimates
An entityâs estimates in accordance with Ind ASs at the transition date to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.
Ind AS estimates as at 1 April 2015 are consistent with the estimates as at the same date made in conformity with previous GAAP The Company made estimates for following items in accordance with Ind AS at the transition date as these were not required under previous GAAP:
- Investment in financial instruments carried at FVTPL or FVTOCI; and
- Impairment of financial assets based on expected credit loss model
- Determination of the discounted value for financial instrument carried at amortised cost.
A2.3 Classification and measurement of financial asset
Ind AS 101 provides exemption to certain classification and measurement requirement of financial assets under Ind AS 109, where these are impracticable to implement. Classification and measurement is done on the basis of facts and circumstances existing on the transition date.
Accordingly the Company has determined classification of financial asset based on facts and circumstances existing on the transition date.
*IGAAP figures have been reclassified to confirm to Ind AS presentation requirements for the purposes of this note.
Footnotes to the above reconciliation are as under:
1 Property, Plant and Equipment
The company has availed option of considering fair value as deemed cost as on transition date for freehold and lease hold lands. Accordingly the said lands have been revalued as on 01.04.2016 and gain arising due to fair value amounting to Rs. 1906.74 Lakhs is added to opening Profit and Loss account. The amortisation of lease hold land is calculated on fair valued amount i.e on deemed cost for FY 2016-17 which amounts to Rs. 27.91 Lakhs which is provided in books of accounts.
2 Capital works in Progress
The company has impaired mining lease rights on transition date as they do not qualify for recognition as per recognition criataria mentioned under the IND AS. This resulted in to decrease in other equity by Rs. 4.11 Lakhs as on transition date
3 Investments in subsidiaries
The company has availed option of considering fair value as deemded cost as on transition date for investments in Subsidiary Companies. These resluted in to 501.51 lakhs increase in opening profit and loss account as on transition date
4 FVTOCI financial assets: Investment in unquoted equity shares
Under IGAAP the company accounted for long term investments in unquoted shares as investment measured at cost less provision for other than temporary diminution in the value of investments. Under Ind AS, the company has designated such investments as FVTOCI investments. At the transition date, difference between the fair value and IGAAP carrying amount has been recognised as a separate component of equity, net of related deferred taxes. This has resulted in a increase in total equity by Rs. 135.86 Lakhs on 01/04/2016(net of tax).
5 Loans(Security Deposits)
The company has impaired Deposits paid for mining on transition date as they do not qualify for recognition as financial assets per recognition criataria mentioned under the IND AS. This resulted in to decrease in other equity by Rs. 10.34 Lakhs as on transition date
6 Trade Receivable
Under IGAAP company was providing provision for bad and doubtful debts which are due more than 270 days. Under IND AS, company provides for imparement loss allowance on financial assets based on expected credit loss method. The equity is decreased by rs. 2.04 Lakhs as on 01.04.2016.
7 Interest accrued but not due on Financial Assets and Financial Liabilities
The company has financial assets and liabilities which carried interest accrued but not due as on transition date as well as 31.03.2017. The interest accrued on financial assets and liabilities at each reporting date is disclosed separately under IGAAP Under Ind AS, those financial assets and liabilities are to be reported at amortised cost. Accordingly interest accrued but not due on the transition date and 31st March 2017 respectively has been reclassified to respective financial assets and liabilities. There is no impact on the total equity or profit as a result of this adjustment.
8 Interest bearing loans and borrowings
Under IGAAP transaction costs incurred in connection with interest bearing loans and borrowings were charged to profit or loss when incurred. Under Ind AS, transaction costs are included in the initial recognition amount of financial liability and charged to profit or loss using the EIR method. Accordingly the total equity increased by Rs. 171.58 Lakhs on the transition date and Rs. 144.12 Lakhs on 31st March 2017. The profit for the year ended 31st March 2017 reduced by Rs. 27.46 Lakhs as a result of additional interest expense.
9 Accounting for excise duty on sale of goods:
Under IGAAP sale of goods was presented as net of excise duty. However, under Ind AS, sale of goods includes excise duty which is considered as an expense. This adjustment has no impact on the total equity on the transition date as well as 31 March 2017.
10 Discount on sale of goods:
Under IGAAP discount was shown as an expense in the financial statement. However, under Ind AS, sale of goods is shown for net consideration received or receivable. hence discount is deducted from sales and not shown as expense. This adjustment has no impact on the total equity on the transition date as well as 31 March 2017.
11 Employee benefits:
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognised in other comprehensive income instead of profit or loss. Under IGAAP these remeasurements were forming part of the profit or loss for the year. This adjustment has no impact on the total equity on the transition date as well as 31 March 2017.
12 Deferred tax Liabilities (net) :
IGAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on certain temporary differences which was not required under IGAAP as discussed below. Further, company has reclassified MAT credit entitlement to deferred tax assets.
C Cash flow statement
There were no significant reconciliation items between cash flows prepared under Indian GAAP and those prepared under Ind AS.
14 Lease
a Expenses
The Company has obtained several premises for its business operations under leave and license agreements. These are generally not non-cancellable lease and are renewable on mutual consent on mutually agreeable terms. Lease payments are recognized in the statement of profit and loss as rent expenses amounting to Rs. 267.52 Lakhs ( Previous Year Rs. 237.81 lakhs) b Income
The Company has given land and building on operating lease for period ranging from 11 months to 60 months. During the year, the company has also given plant and machinery on operating lease and has recognized the lease rent on both assets in the statement of profit and loss amounting to Rs. 61.42 lakhs (Previous Year Rs. 123.75 lakhs)
15 Previous year figures
Previous yearâs figures have been regrouped or reclassified wherever necessary to confirm to the current periodâs presentation.
The Accompanying Notes are an integral part of the financial Statements.
Mar 31, 2016
d. Rights, Preferences and Restrictions Attached to Equity Shares
i The Company has only one class of shares referred to as equity shares having a par value of '' 5 each.
ii Each holder of equity shares is entitled to one vote per share which can be exercised either personally or by an attorney or by proxy.
iii The dividend proposed if any by the Board of Directors is subject to approval of the shareholders in the ensuing general meeting except in the case of interim dividend.
iv In the event of liquidation of the Company, the holders of equity shares shall be entitled to receive assets of the Company, after distribution of all preferential amounts. The amount distributed will be in proportion to the number of equity shares held by the shareholders.
d. Details of Securities
The term loans obtained as consortium loans are secured by way of
1 First pari-passu charge by way of mortgage / hypothecation over :
i. Plot No. 157 Mamura, Bhuj (admeasuring 3.20 acres )
ii. Negative lien on Plot No. 158,156,149 of Mamuara, Bhuj (admeasuring 74399 sq.mtrs.)
iii. Plot No. 172,174 & 175, Vadadala, Baroda (admeasuring 03.00.01 hectares)
iv. Plot No. F-75/76/82/85 & H-83/84, RIICO I.A., Swaroopganj, Rajasthan (admeasuring 9,457.50 sq.mtrs.)
v. 307/308, Arundeep Complex, Race Course, Baroda (admeasuring 1,405 super built up area)
vi. 134,135 1st Floor, Hindustan Kohinoor Ind. Complex, LBs Marg, Vikhroli (W), Mumbai (admeasuring 870 sq. ft.)
vii. Plot No. B-77 (Admeasuring 8825 sq. mts.) and B-78 (Admeasuring 8480 sq. mts), Matsya Industrial Area, Alwar, Rajasthan.
viii. Plot no. 253-254 (area 3000 sq.mtrs.) GIDC, Waghodia
ix. Plot no. 23 & 24 (area 3.29 acre), SIPCOT Industrial Estate, Phase-II, Hosur, Krishnagiri, Tamil Nadu
x. Plot no.104/3 of land located at survey no 65, village Puthur, Tirunvelli, Tamil Nadu (admeasuring 20,261 sq.mtrs.)
xi. Plant and machinery, both present and future, wherever situated at all factories and premises pertaining to above locations.
1 Second pari-passu charge by way of mortgage / hypothecation over :
Current assets, both present and future, wherever situated, but pertaining to the division/factory/premises at Vadadala, Waghodia and Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
2 All the term loans are further collaterally secured by personal guarantee of Executive Chairman, CEO and Managing Director, of the company and corporate guarantee by âEriez Finance & Investement Ltd.â a company where significant influence exists.
3 Term loans of '' 47.91 Lacs (Previous Year: '' 88.79 Lacs) obtained for acquisition of assets (vehicles) are secured only by the hypothecation of the respective assets financed.
e. Credit facilities availed by the company from IDBI Bank Limited and State Bank of India (SBI.) were restructured by both banks and given affect to on 31st March 2015. Main terms of restructuring were deferment of repayment of term loan matching with future cash flow of the company, marginal reduction in interest rates subject to recompense for sacrifice made if any and refund of term loan installments paid during 2014-15.
Company has been repaying its dues of debt from date of restructuring without any default. SBI informed the company on 4th April 2016 that under Asset Quality Review by Reserve Bank of India (RBI) its account has been classified as NPA with effect from 1st April, 2014 on account of delay in creation of security. Delay, if any, is not attributable to company and company has represented to SBI to restore the classification of account to Standard from NPA, with immediate effect. SBI has assured that they will review and take the corrective action by 2''nd quarter. IDBI continues to classify the account as standard asset.
Company does not see any significant liability of recompense as no real sacrifice was made by banks except deferment of repayment obligation.
In view of the above, the classification of Borrowings in to Current and Non-Current Category is made considering the period in which the borrowings will be repaid as per the terms agreed under the restructuring proposal.
c. Details of Securities
The working capital facilities are secured by way of:
4 First pari-passu charge by way of hypothecation of:
Current Assets, both present and future, wherever situated, but pertaining to the division/factory/premises at Vadadala, Waghodia and Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
5 Second pari-passu charge on factories and premises and plant and machineries, both present and future, wherever situated, but pertaining to the locations stated in note 3(d)(1).
6 The working capital finance facilities are further collaterally sercured by personal guarantee of Executive Chairman, CEO and Managing Director, Managing Director of the company and corporate guarantee by âEriez Finance & Investement Ltd. â, a company where significant influence exists.
7 Note on NPA - Refer Note 4(e)
8 Discount Rate used for valuing liabilities is based on yields (as on valuation date) of Government Bonds with tenure similar to the expected working lifetime of the employee.
9 Estimates of future salary increase are based on inflation, seniority, promotion and other relevant factors such as demand and supply in the employment market. This assumption has been determined in consultation with the company.
(iii) Guarantees and Letter of Credits:
- Company has given guarantee of '' 1,225.00 lacs (Previous Year '' 1,225.00 lacs) on behalf of subsidiary company.
- Guarantee given by Company''s Bankers in normal course of business '' 251.88 lacs (Previous Year '' 205.11 lacs).
- Inland / Foreign Letter of Credit issued by Bank '' 516.41 lacs (Previous Year '' 2,434.51 lacs).
B. Capital Commitments:
Estimated amount of contracts remaining to be executed on capital account, not provided for amounting to '' 27.97 lacs (Net of Advances of '' 809.52 lacs) [Previous Year '' 15.67 lacs (Net of Advances of '' 808.90 lacs)]
10. In the opinion of the management, the current assets and loans and advances considered as non-current and other non-current assets are stated at value, which is realizable in the ordinary course of business and provision is made for all known material liabilities. Balances of Trade Receivable and Trade Payables are subject to confirmation, reconciliation and consequential adjustments, if any.
Notes :
1. Following are the list of Independent Directors which whom no transaction have been occurred during the Financial Year 2015-16 other than payment of Sitting Fees :
a) Mr. Pravinchandra M Shah
b) Mr. Ram Devidayal
c) Mr. Atul Patel
d) Mrs. Darsha Kikani
e) Dr. Ajay Ranka
11. 20 Microns Nano Minerals Ltd, 20 Microns SDN BHD, 20 Microns FZE have been using software package being âSAPâ by 20 Microns Ltd without payment of Consideration.
12. Leases
A) The Company has obtained several premises for its business operations under leave and license agreements. These are generally not non-cancelable lease and are renewable on mutual consent on mutually agreeable terms. Lease payments are recognized in the statement of profit and loss as rent expenses amounting to '' 253.29 lacs (previous year '' 278.00 lacs)
B) The Company has given land and building on operating lease for period ranging from 11 months to 60 months. During the year, the company has also given plant and machinery on operating lease and has recognized the lease rent on both assets in the statement of profit and loss amounting to '' 142.37 lacs (Previous Year '' 9.15 lacs)
13. Forward Contracts
A) The Company uses forward contracts to hedge its risks associated with fluctuations in foreign currency and interest rates. The use of forward contracts is covered by Company''s overall strategy. The Company does not use forward covers for speculative purposes.
B) Part of the foreign currency loans are covered by comprehensive hedge which effectively fixes liability of such loans and further there is no additional risk involved post hedging of such loans.
C) The outstanding forward contracts as at March 31, 2016 is '' NIL (Previous Year '' 143.42 lacs) in respect of hedging currency related risk.
14. The figures of the previous year have been regrouped / reclassified, where necessary, to conform with the current year''s
classification.
Mar 31, 2015
1. Rights, Preferences and Restrictions Attached to Equity Shares
i The Company has only one class of shares referred to as equity shares
having a par value of Rs. 5 each.
ii Each holder of equity shares is entitled to one vote per share which
can be exercised either personally or by an attorney or by proxy.
iii The dividend proposed if any by the Board of Directors is subject
to approval of the shareholders in the ensuing general meeting except
in the case of interim dividend.
iv In the event of liquidation of the Company, the holders of equity
shares shall be entitled to receive assets of the Company, after
distribution of all preferential amounts. The amount distributed will
be in proportion to the number of equity shares held by the
shareholders.
2. Details of Securities
The term loans obtained as consortium loans are secured by way of
3. First pari-passu charge by way of mortgage / hypothecation over :
4. Plot No. 157 Mamura, Bhuj (admeasuring 3.20 acres)
5. Negative lien on Plot No. 158,156,149 of Mamuara, Bhuj
(admeasuring 74399 sq.mtrs.)
6. Plot No. 172,174 & 175, Vadadala, Baroda (admeasuring 03.00.01
hectares)
7 Plot No. F-75/76/82/85 & H-83/84, RIICO I.A., Swaroopganj, Rajasthan
(admeasuring 9,457.50 sq.mtrs.)
8. 307/308, Arundeep Complex, Race Course, Baroda (admeasuring 1,405
super built up area)
9. 134,135 1st Floor, Hindustan Kohinoor Ind. Complex, LBs Marg,
Vikhroli (W), Mumbai (admeasuring 870 sq. ft.)
10. Plot No. B-77 (Admeasuring 8825 sq. mts.) and B-78 (Admeasuring
8480 sq. mts), Matsya Industrial Area, Alwar, Rajasthan.
11. Plot no. 253-254 (area 3000 sq.mtrs.) and plot no.728 & 729 (area
4061 sq mtrs), GIDC, Waghodia
12. Plot no. F-140 (admeasuring 2304 sq.mtrs.)
13. Plot no.23 & 24 (area 3.29 acre), SIPCOT Industrial Estate,
Phase-II, Hosur, Krishnagiri, Tamil Nadu
14. Plot no.104/3 of land located at survey no 65, village Puthur,
Tirunvelli, Tamil Nadu (admeasuring 20,261 sq.mtrs.)
15. Plant and machinery, both present and future, wherever situated
at all factories and premises pertaining to above locations.
16. Second pari-passu charge bv wav of mortgage / hypothecation over :
Current assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
17. All the term loans are further collaterally secured by personal
guarantee of Executive Chairman, CEO and Managing Director, Managing
Director of the company and corporate guarantee by "Eriez Finance &
Investement Ltd.", a company where significant influence exists.
18. Term loans of Rs. 88.79 Lacs (Previous Year: Rs. 133.63 Lacs)
obtained for acquisition of assets (vehicles) are secured only by the
hypothecation of the respective assets financed.
19. Restructuring of Term and Working Capital Loans during the Year
During the financial year ended March 31,2015, the Company's proposal
of restructuring of existing fund based and non-fund based financial
facilities with Consortium Bankers namely State Bank of India and IDBI
Bank Limited was approved. The cut off date agreed is 1st April,2014
and restructuring is subject to renewal and reassessment every year.
As per the restructuring proposal, the existing Term Loans and
Corporate Loan have been rescheduled / restructured and certain portion
of interest has been converted into Funded Interest Term Loans (FITL).
Repayment of Term Loans, Corporate Loan and FITL shall be made in equal
monthly instalments from April 2016 after considering a moratorium
period of 24 Months. Important conditions of the restructuring
proposals are as under :
20. Release of primary security in the form of land and building
located at the following locations with the condition to deposit the
sale proceeds in Term Loan account(s):
Plot Nos.- 253 &254, 728&729, GIDC Waghodia.
Plot nos-F-75/76/82/85 & H-83/84, RIICO, Swaroopgunj, Rajasthan.
Plot no-140, Alwar, Rajasthan.
Survey no-65, Door no. 104-3, Puthur village, Tirunelvelli.
307-308, Arundeep Complex, Vadodara.
21. all advances are to be collaterally secured by pledge of entire
shareholding of promoters of the Company i.e. of 8,500,547 shares
including 1,550,235 unencumbered shares of Corporate Promoter being
"Eriez Finance & Investment Limited".
22. Eriez Finance & Investment Limited is to provide corporate
guarantee as security which has been provided on 26th March,2015.
23. Any deficit in estimated internal accruals / cash flow during the
restructured period shall be made up by additional promoters'
contribution (non-interest bearing funds).
24. No additional capex (except to the extent captured in the CMA) or
change in management structure of the company shall be made without
prior permission of the Consortium.
25. In the event of increase in Paid-Up Capital of the company, the
promoters' shall pledge their shares additionally, to ensure that total
pledged shares to Banks forms 30% of the total Paid-Up Capital.
26. Company shall not declare dividends or increase remuneration /
compensations to Directors / top executives without prior approval of
the Banks.
27. Details of Securities
The working capital facilities are secured by way of:
1 First pari-passu charge by way of hypothecation of:
Current Assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
2 Second pari-passu charge on factories and premises and plant and
machineries, both present and future, wherever situated, but pertaining
to the locations stated in note 3(d)(1).
3 The working capital finance facilities are further collaterally
sercured by personal guarantee of Executive Chairman, CEO and Managing
Director, Managing Director of the company and corporate guarantee by
"Eriez Finance & Investement Ltd. ", a company where significant
influence exists.
28. Contingent Liabilities and Commitments (To the extent not provided
for)
(A) Contingent Liabilities
(i) Claims against the company not acknowledged as debt:
The Company does not have any claims note acknowledged as debt as on
the balance sheet date (Previous Year Rs. Nil)
(ii) Other money for which the company is contingently liable - Matter
under dispute:
(Rs. in lacs)
Sr. Particulars 2014-15 2013-14
No.
1 Demand of Sales Tax, Value Added
Tax and Central Sales Tax
(An amount of Rs. 3.10 lacs deposited
under protest) 12.53 12.53
2 Claims from Excise and Customs authorities
not acknowledged as debt. (An amount
of Rs. 19.12 lacs deposited under protest
in previous year) 758.44 773.56
3 Demand of Income Tax 125.00 70.23
(iii) Guarantees and Letter of Credits:
* Company has given guarantee of Rs. 1,225.00 lacs
(Previous Year Rs. 1,225.00 lacs) on behalf of subsidiary
company.
* Guarantee given by Company's Bankers in normal course of business
Rs. 205.11 lacs (Previous Year Rs. 39.46 lacs).
* Inland / Foreign Letter of Credit issued by Bank Rs. 2434.51 lacs
(Previous Year Rs. 1896.42 lacs).
(B) Capital Commitments:
Estimated amount of contracts remaining to be executed on capital
account, not provided for amounting to Rs. 15.67 lacs (Net of Advances
of Rs. 808.90 lacs) [Previous Year Rs. 26.28 lacs (Net of Advances of
Rs. 1125.28 lacs)]
29. In the opinion of the management, the current assets and loans and
advances considered as non-current and other non-current assets are
stated at value, which is realizable in the ordinary course of business
and provision is made for all known material liabilities. Balances of
Trade Receivable and Trade Payables are subject to confirmation,
reconciliation and consequential adjustments, if any.
30. Segment Information
The Company operates only in one business segment namely Micronized
Minerals. In view of this, no separate disclosure is required under
AS-17.
31. Related party transactions
Notes :
1. Following are the List of Independent Directors with whom no
transactions has been occurred during the Financial year 2014-15 other
than payment of sitting Fees :
a) Mr. Pravinchandra M. Shah
b) Mr. Ram A. Devidayal
c) Mr. Atul H. Patel
d) Mr. Ajay I. Ranka
2. 20 Microns Nano minerals Limited, 20 Microns SDN.BHD, 20 Microns
FZE, have been using software package being "SAP" by 20 Microns Limited
without payment of Consideration.
32. Leases
A) The Company has obtained several premises for its business
operations under leave and license agreements. These are generally not
non-cancelable lease and are renewable on mutual consent on mutually
agreeable terms. Lease payments are recognized in the statement of
profit and loss as rent expenses amounting to Rs. 278.00 lacs (previous
year Rs. 264.50 lacs)
B) The Company has given land and building on operating lease for
period ranging from 11 months to 60 months. During the year, the
company has also given plant and machinery on operating lease and has
recognized the lease rent on both assets in the statement of profit and
loss amounting to Rs. 9.15 lacs (Previous Year Rs. 8.52 lacs)
33. Forward Contracts
A) The Company uses forward contracts to hedge its risks associated
with fluctuations in foreign currency and interest rates. The use of
forward contracts is covered by Company's overall strategy. The Company
does not use forward covers for speculative purposes.
B) Part of the foreign currency loans are covered by comprehensive
hedge which effectively fixes liability of such loans and further there
is no additional risk involved post hedging of such loans.
C) The outstanding forward contracts as at March 31,2015 is Rs. 143.42
lacs (Previous Year Rs. 245.00 lacs) in respect of hedging currency
related risk.
34. As per Section 74(1) of the Companies Act, 2013, the Company is
required to make repayment of deposit accepted prior to 31.03.2014
within a period of one year from 01.04.2014 or the date on which
deposit becomes due for payment, whichever is earlier. The Company has
repaid the deposits which have matured during the year 2014-15.
However, in respect of deposits maturing after 31.03.2015, the Company
has made an application dated March 29, 2015 under Section 74 (2) of
the Companies Act, 2013, before the Company Law Board, Western Region
Bench, Mumbai to allow the Company to re-pay the deposits upto and
inclusive of the time as agreed with the fixed deposit holders. Pending
the outcome of the application made the deposits are not re-paid by the
Company before 31.03.2015. Consequently, the classification of deposit
in to Current and Non-Current Category is made considering the period
within which deposit will be repaid.
35. The figures of the previous year have been regrouped /
reclassified, where necessary, to confirm with the current year's
classification.
Mar 31, 2014
1.a. Rights, Preferences and Restrictions Attached to Equity Shares
i The Company has only one class of shares referred to as equity shares
having a par value of Rs. 5 each.
ii Each holder of equity shares is entitled to one vote per share which
can be exercised either personally or by an attorney or by proxy.
iii The dividend proposed if any by the Board of Directors is subject
to approval of the shareholders in the ensuing general meeting except
in the case of interim dividend.
iv In the event of liquidation of the Company, the holders of equity
shares shall be entitled to receive assets of the Company, after
distribution of all preferential amounts. The amount distributed will
be in proportion to the number of equity shares held by the
shareholders.
b. The Company has not bought back any equity shares, has not allotted
any shares as fully paid up pursuant to contracts without payment being
received in cash and has not allotted bonus shares, for the period of
five years immediately preceding March 31,2014.
c. Details of Securities
The term loans obtained as consortium loans are secured by way of
2. First pari-passu charge by way of mortgage / hypothecation over :
i. Plot No. 149,156,157 &158 Mamura, Bhuj (admeasuring 88,864
sq.mtrs.)
ii. Plot No. 172,174 & 175, Vadadala, Baroda (admeasuring 03.00.01
hectares)
iii. Plot No. F-75/76/82/85 & H-83/84, RIICO I .A., Swaroopganj,
Rajasthan (admeasuring 9,457.50 sq.mtrs.)
iv 307/308, Arundeep Complex, Race Course, Baroda (admeasuring 1,405
sq. ft super built up area)
v 134,135 1st Floor, Hindustan Kohinoor Ind. Complex, LBs Marg,
Vikhroli (W), Mumbai (admeasuring 870 sq. ft.)
vi. Plot No. B-77 (Admeasuring 8825 sq. mts.) and B-78 (Admeasuring
8480 sq. mts), Matsya Industrial Area, Alwar, Rajasthan.
vii. Plot no. 253-254 (area 3000 sq.mtrs.) and plot no.728 & 729 (area
4061 sq mtrs), GIDC, Waghodia.
viii. Plot no. F-140 (admeasuring 2304 sq.mtrs.), F-141 (admeasuring
2275 sq.mtrs.), F-142 (admeasuring 1950 sq.mtrs.), RIICO Industrial
Area, Alwar, Rajasthan.
ix. Plot no. 23 & 24 (area 3.29 acre), SIPCOT Industrial Estate,
Phase-II, Hosur, Krishnagiri, Tamil Nadu
x. Plot of land located at survey no 65, village Puthur, Tirunvelli,
Tamil Nadu (admeasuring 20,261 sq.mtrs.)
xi. Plant and machinery, both present and future, wherever situated at
all factories and premises pertaining to above locations.
3. Second pari-passu charge by way of mortgage / hypothecation over:
Current assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
3. All the term loans are further collaterally secured by personal
guarantee of Chairman and Managing Director, Managing Director and
Joint Managing Director of the Company.
4. Term loans of Rs. 133.63 Lacs (Previous Year: Rs. 153.52 Lacs)
obtained for acquisition of assets (vehicles) are secured only by the
hypothecation of the respective assets financed.
a. Details of Securities
The working capital finance facilities are secured by way of:
1. First pari-passu charge by way of hypothecation of:
Current Assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
2. Second pari-passu charge on factories and premises and plant and
machineries, both present and future, wherever situated, but pertaining
to the locations stated in note 3(d)(1).
3. The working capital finance facilities are further collaterally
secured by personal guarantee of Chairman and Managing Director,
Managing Director and Joint Managing Director of the Company.
5. Contingent Liabilities and Commitments (To the extent not provided
for)
(A) Contingent Liabilities
(i) Claims against the company not acknowledged as debt:
The Company does not have any claims note acknowledged as debt as on
the balance sheet date (Previous Year Rs. Nil)
(ii) Other money for which the company is contingently liable - Matter
under dispute:
(Rs. in lacs)
Sr. Particulars 2013-14 2012-13
No.
1 Demand of Sales Tax, Value Added
Tax and Central Sales Tax (An amount
of Rs. 3.10 lacs deposited under protest) 12.53 12.53
2 Claims from Excise and Customs authorities
not acknowledged as debt. (An amount of Rs.
19.12 lacs deposited under protest) 773.56 761.86
3 Demand of Income Tax 70.23 21.46
(iii) Guarantees and Letter of Credits:
* Company has given guarantee of Rs. 1,225.00 lacs (Previous Year Rs.
1,225.00 lacs) on behalf of subsidiary company.
* Guarantee given by Company''s Bankers in normal course of business Rs.
39.46 lacs (Previous Year Rs. 57.01 lacs).
* Inland / Foreign Letter of Credit issued by Bank Rs. 1,896.42 lacs
(Previous Year Rs. NIL).
(B) Capital Commitments:
Estimated amount of contracts remaining to be executed on capital
account, not provided for amounting to Rs. 26.28 lacs (Net of Advances
of Rs. 1125.28 lacs) [Previous Year Rs. 474.18 lacs (Net of Advances of
Rs. 1088.08 lacs)]
6. In the opinion of the management, the current assets and loans and
advances considered as non-current and other non- current assets are
stated at value, which is realizable in the ordinary course of business
and provision is made for all known material liabilities. Balances of
Trade Receivable and Trade Payables are subject to confirmation,
reconciliation and consequential adjustments, if any.
7. Segment Analysis
The Company operates only in one business segment namely Micronized
Minerals. In view of this, no separate disclosure is required under
AS-17.
8. Leases
(A) The Company has obtained several premises for its business
operations under leave and license agreements. These are generally not
non-cancelable lease and are renewable on mutual consent on mutually
agreeable terms. Lease payments are recognized in the statement of
profit and loss as rent expenses amounting to Rs. 264.50 lacs (previous
year Rs. 231.10 lacs)
(B) The Company has given land and building on operating lease for
period ranging from 11 months to 60 months. During the year, the
company has also given plant and machinery on operating lease and has
recognized the lease rent on both assets in the statement of profit and
loss amounting to Rs. 8.52 lacs (Previous Year Rs. 7.80 lacs )
9. Forward Contracts
(A) The Company uses forward contracts to hedge its risks associated
with fluctuations in foreign currency and interest rates. The use of
forward contracts is covered by Company''s overall strategy. The Company
does not use forward covers for speculative purposes.
(B) Part of the foreign currency loans are covered by comprehensive
hedge which effectively fixes liability of such loans and further there
is no additional risk involved post hedging of such loans.
(C) The outstanding forward contracts as at March 31,2014 is Rs. 245.00
lacs (Previous Year Rs. 789.08 lacs) in respect of hedging currency
related risk.
10. As per Section 74(2) of the Companies Act, 2013, the Company is
required to make repayment of deposit accepted prior to 31.03.2014
within a period of one year from 01.04.2014 or the date on which
deposit becomes due for payment, whichever is earlier. However the
management believes that in terms of the provisions of Section 76(2) of
the Companies Act, 2013 read with Rule 19 of the Companies (Acceptance
of Deposits) Rules, 2014, the Company can make repayment of deposits
within the period as per the terms of acceptance of deposits.
Consequently, the classification of deposit in to Current and Non
Current Category is made considering the period within which deposit
will be repaid.
11. The figures of the previous year have been regrouped /
reclassified, where necessary, to conform to the current year''s
classification.
Mar 31, 2013
1. CONTINGENT LIABILITIES AND COMMITMENTS
(To the extent not provided for)
A. Contingent Liabilities
(i) Claims against the company not acknowledged as debt:
The Company does not have any claims note acknowledged as debt as on
the balance sheet date (Previous Year: Rs. Nil)
(ii) Other money for which the company is contingently liable - Matter
under dispute:
(Rs. in Lacs]
Sr.
No. Particulars 2012-13 2011-12
1 Demand of Sales Tax,
Value Added Tax &
Central Sales Tax 12.53 5.85
2 Claims from Excise and
Customs authorities not 754.44 897.35
acknowledged as debt._
3 Demand of Income Tax 21.46 209.31
(iii) Guarantees and Letter of Credits:
- Company has given guarantee of Rs.1,225.00 Lacs (Previous Year: Rs.
1,225.00 Lacs) on behalf of subsidiary company.
- Guarantee given by Company''s Bankers in normal course of business
Rs.57.01 lacs (Previous Year: Rs.31.19 Lacs).
- Inland / Foreign Letter of Credit issued by Bank Rs. Nil [Previous
Year: Rs.372.59 Lacs).
Particulars
B. Capital Commitments
Estimated amount of contracts remaining to be executed on capital
account, not provided for (net of advances) amounting toRs. 474.18 lacs
[Net of Advances of Rs.1088.08) [Prev. Year:Rs. 812.80 lacs] (Net of
Advances ofRs. 1308.19)
C. Other Commitments:
Company has decided to transfer its undertaking, associated with the
Mineral Products viz. Calcined Clay, China Clay and Talc, by way of
slump sale to a wholly owned subsidiary, subject to necessary approvals
including the licenses, permits, consents and approval whatsoever on a
going concern basis. The shareholders of the Company have approved the
decision of the board and the resolution in these regards was announced
as passed on 18.03.2013.
2. In the opinion of the management, the current assets and loans and
advances considered as non-current and other non-current assets are
stated at value, which is realizable in the ordinary course of business
and provision is made for all known material liabilities. Balances of
Trade Receivable and Trade Payables are subject to confirmation,
reconciliation and consequential adjustments, if any.
3. SEGMENTANALYSIS
The Company operates only in one business segment i.e. Industrial
Minerals. In view of this, no separate disclosure in required
underAS-17.
4. RELATED PARTY TRANSACTIONS
As required under the Accounting Standard AS - 18 on "Related Party
Disclosures" as notified by The Companies (Accounting Standards]
Rules, 2006 are given below:
[A) List of related parties:
a. Enterprises where control exists (subsidiaries):
a. 20 Microns SDN BHD
b. 20 Microns Nano Minerals Limited
c. 20 Microns FZE
b. Enterprises where significant influence exists:
a. DMC Limited
b. Bruno Industrial Products Limited
c. Microns Logistic Private Limited
d. Eriez Finance & investment Limited
e. Aric 20 Microns Infracon Private Limited
f. Platy Minerals Private Limited
g. Nanotech Minerals India Private Limited
h. Ultra Minechem Equipments Private Limited
i. 20 Microns Foundation Trust,
j. 20 Microns ESOSTrust.
c. Key Management Personnel:
a. ShriCSParikh - Chairman and Managing Director
b. Shri SR Parikh - Whole Time Director
c. Shri RC Parikh - Managing Director
d. Shri AC Parikh - Jt. Managing Director
d. Relatives of Key Management Personnel:
a. Mrs.IC Parikh  Wife of Shri CSParikh
b. Shri LR Parikh  Brother of Shri Sudhir Parikh
c. Mrs DS Parikh  Wife of Shri Sudhir Parikh
d. Mrs SR Parikh - Wife of Shri Rajesh C Parikh
e. Ms.VR Parikh  Daughter of Shri Rajesh C Parikh
f. Mrs PA Parikh - Wife of Shri AC Parikh
g. Shri SR Parikh [HUF] - Shri SR Parikh is Karta of HUF
* Loans and advances of enterprise where significant influence exists
includes Rs. 8.45 lacs (Previous Year Rs. 3.00 lacs) advanced to 20 Microns
ESOS Trust for acquiring the equity shares of the company, for the
benefit of the employees.
* Loans and advances of enterprise where significant influence exists
includes Rs. 18.60 lacs (previous yearRs. 10.15 lacs) advanced to 20
Microns ESOS Trust for acquiring the equity shares of the company,
for the benefit of the employees.
5. LEASES
(A) The Company has obtained several premises for its business
operations under leave and license agreements. These are generally not
non-cancelable lease and are renewable on mutual consent on mutually
agreeable terms. Lease payments are recognized in the profit and loss
account as rent expenses amounting to Rs. 231.10 (previous year Rs.
229.09 lacs)
(B) The Company has given land and building on operating lease for
period ranging from 11 months to 60 months. During the year, the
company has also given plant and machinery on operating lease and has
recognized the lease rent on both assets in the profit and loss account
amounting to Rs. 7.8 lacs (Previous Year Rs. 21.55 lacs)
* The Basic and Diluted Earnings Per Share for the year 2011-12 is
calculated considering the split of face value of Equity Sha res from
Rs. 10 each to Rs.5 each.
6. FORWARD CONTRACTS
(A) The Company uses forward contracts to hedge its risks associated
with fluctuations in foreign currency and interest rates. The use of
forward contracts is covered by Company''s overall strategy. The Company
does not use forward covers for speculative purposes.
(B) Part of the foreign currency loans are covered by comprehensive
hedge which effectively fixes liability of such loans and further there
is no additional risk involved post hedging of such loans.
(C) The outstanding forward contracts as at March 31,2013 is Rs. 789.08
Lacs (Previous Year Rs. 4859.04 Lacs) in respect of hedging currency
related risk.
7. EQUITY DIVIDENDS
7.1 Dividends declared
The board of directors in its meeting held on May 23,2012, recommended
a final dividend of Rs. 1.80 per equity share of Rs. 10 each (18% of
face value) for financial year 2011-12, which was duly approved by the
shareholders of the Company in the Annual General Meeting of the
company held on August 9,2012.
7.2 Dividends proposed
The board of directors in their meeting held on 28.05.2013 have
proposed a dividend of Rs.0.50 per equity share of Rs.5 each (10% of face
value) for the financial year 2012-13. The same is subject to
shareholder''s approval in the Annual General Meeting.
8. EVEN TSAFTER THE BALANCE SHEET DATE
The shareholders in the Extra-ordinary general meeting held on May
25,2013 approved the allotment of 4,00,000 Fully Convertible Debenture
(FCD) ofRs. 100 each on a preferential basis to M/s Pratik Minerals
Private Limited as specified in the notice of the Extra-Ordinary
General Meeting issued by the Company on April 26,2013. The terms and
conditions of the allotment are:
a) The FCD shall be compulsorily convertible into Equity Shares at the
end of 6 months from the date of allotment of FCD.
b) Each FCD is convertible into Equity Share of the Company of the face
value of Rs.5/- each at a prevailing average market value as calculated
at an average closing price of last 26 weeks OR average of last 2 weeks
average closing prices, whichever is higher from the relevant date.
c) The applicant to the said FCD shall make 100% payment for the
subscription to the 4,00,000 FCDs of the face value ofRs. 100/- each, at
the time of applying.
d) The FCD shall carry interest of 0% coupon rate.
e) The Equity shares to be issued on compulsory conversion of the FCD,
shall be under lock in for a period of one year and the lock in date
shall commence from the date of conversion.
f) The issue shall remain open for subscription for a period of 1 month
from the shareholders resolution.
g) Any terms other than above shall be governed by the relevant
provision of the SEBI Regulations and Companies Act, 1956 in this
regards.
The fresh Equity Shares allotted on conversion of FCDs shall rank pari
passu in all respects with the existing Equity Shares of the company.
As at the Balance Sheet date the Company has received Rs. 200.00 Lacs as
Inter Corporate Deposit from the proposed allotted which is shown under
the head long term borrowing [Note No. 4). Subsequent to the balance
sheet date Company has received the balance consideration of Rs.200.00
Lacs from the proposed allottee.
Mar 31, 2012
A. Rights, preferences and restrictions attached to shares
i The Company has only one class of shares referred to as equity shares
having a par value of Rs 10/-.
ii Each holder of equity shares is entitled to one vote per share which
can be exercised either personally or by an attorney or by proxy.
The dividend proposed by the Board of Directors is subject to approval
of the shareholders in the ensuing general meeting except in the case
of interim dividend.
In the event of liquidation of the Company, the holders of equity
shares shall be entitled to receive any of the remaining assets of the
Company, after iv distribution of all preferential amounts. The amount
distributed will be in proportion to the number of equity shares held
by the shareholders.
b. Shares reserve for issue under commitment to convert warrants into
equity shares
i The shareholders in the Extra-ordinary general meeting held on April
23, 2012 approved the allotment of 15,00,000 warrants on a preferential
basis to promoters and other investors as specified in the notice of
the Extra-Ordinary General Meeting issued by the Company on March 23,
2012. Each warrant is convertible into 1 (one) Equity Share of the
Company of the face value of ' 10/- each at a premium of ' 80/- per
share. Each warrant being priced at' 90/- per share. On compliance of
conditions of issue of warrants the warrants shall be converted in to
15,00,000 Equity Shares out of the unissued portion of share capital.
c. Details of securities
The term loans obtained as consortium loans are secured by way of
1 first pari-passu charge over :
i. Plot No. 157, Mamura, Bhuj (admeasuring 3.20 acres)
ii. Plot No. 172,174 & 175, Vadadala, Baroda (admeasuring 03.00.01
hectares)
iii. Plot No. F-75/76/82/85 & H-83/84, RIICO I.A., Swaroopganj,
Rajasthan (admeasuring 9,457.50 sq.mtrs.)
iv. 307/308, Arundeep Complex, Race Course, Baroda (admeasuring 1,405
super built up area)
v. 134,135 1st Floor, Hindustan Kohinoor Ind. Complex, LBs Marg,
Vikhroli (W), Mumbai (admeasuring 870 sq. ft.)
vi. Corporate office at plot no.347, GIDC, Waghodia
vii. Plot no. 253-254 (area 3000 sq.mtrs.) and plot no.728 & 729 (area
4061 sq mtrs), GIDC, Waghodia
viii. Plot no. F-140 (admeasuring 2304 sq.mtrs.), F-141 (admeasuring
2275 sq.mtrs.), F-142 (admeasuring 1950 sq.mtrs.), RIICO Industrial
Area, Alwar, Rajasthan.
ix. Plot no.23 & 24 (area 3.29 acre), SIPCOT Industrial Estate,
Phase-II, Hosur, Krishnagiri, Tamil Nadu
x. Plot no.104/3, village Puthur, Tirunvelli, Tamil Nadu (admeasuring
20,261 sq.mtrs.)
xi. Plant and machinery, both present and future, wherever situated at
all factories and premises pertaining to above locations.
2 second pari-passu charge over:
current assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
All the term loans are further collaterally secured by personal
guarantee of Chairman and Managing Director, Managing Director and
Joint Managing Director of the Company.
Term loans of Rs 176.30 Lacs (Previous Year:Rs 163.27 Lacs) obtained
for acquisition of assets (vehicles) are secured only by the
hypothecation of the respective assets financed.
c. Details of securities
The working capital finance facilities are secured by way of:
1 first pari-passu charge over:
current assets, both present and future, wherever situated, but
pertaining to the division/factory/premises at Vadadala, Waghodia and
Bhuj (all in Gujarat), Alwar and Swaroopganj (both in Rajasthan), Hosur
and Tirunvelli (both in Tamil Nadu) and Vikhroli (W), Mumbai.
second pari-passu charge on factories and premises and plant and
machineries, both present and future, wherever situated, but pertaining
to the locations stated in note 3(d)(1).
The working capital finance facilities are further collaterally secured
by personal guarantee of Chairman and Managing Director, Managing
Director and 3 Joint Managing Director of the Company.
B.8 Discount Rate used for valuing liabilities is based on yields (as
on valuation date) of Government Bonds with tenure similar to the
expected working lifetime of the employee.
B.9 Estimates of future salary increase are based on inflation,
seniority, promotion and other relevant factors such as demand and
supply in the employment market. This assumption has been determined in
consultation with the company.
3. Contingent Liabilities and Commitments
(To the extent not provided for)
A. Contingent Liabilities
(i) Claims against the company not acknowledged as debt:
The Company does not have any claims note acknowledged as debt as on
the balance sheet date (Previous Year: Rs Nil)
(ii) Other money for which the company is contingently liable - Matter
under dispute:
(Rs.in Lacs)
SR. PARTICULARS March 31, 2012 March 31, 2011
NO. Rs. Rs.
1 Demand of Sales Tax
disputed in appeal. 5.85 8.59
2 Claims from Excise
authorities not
acknowledged as 147.68 148.68
debt.
3 Demand of Income Tax
disputed in appeal. 209.31 168.24
(iii) Guarantees and Letter of Credits:
- Company has given guarantee of Rs 1,250.00 (Previous Year: Rs 1,250.00
Lacs) on behalf of subsidiary company.
- Guarantee given by Company's Bankers in normal course of business Rs31.19 lacs (Previous Year Rs13.49 Lacs).
- Inland / Foreign Letter of Credit issued by Bank Rs 372.59 lacs
(Previous Year:Rs 499.18 Lacs).
B. Capital Commitments
Estimated amount of contracts remaining to be executed on capital
account, not provided for (net of advances) amounting to Rs 812.80 lacs
(Previous Year Rs 1193.88 lacs).
4. In the opinion of the management, the current assets and loans and
advances considered as non-current and "other non-current assets" are
stated at value, which is realizable in the ordinary course of business
and provision is made for all known material liabilities.
5. During last quarter of financial year 2011-12, a Bank has debited
in our account a sum of Rs.145.52 lacs on account of exchange
difference on expiry of forward contracts. Preliminary investigation
revealed that a senior executive of the Company, acting beyond
delegated powers, had booked forward contracts for sale of US Dollars.
The Company believes that Bank had permitted Senior Executive to book
such contracts beyond powers delegated to him and it also appears that
bank has permitted these contracts in contravention of various
guidelines of Reserve Bank of India on the subject.
Total loss on account of all such contracts is estimated at Rs. 505.25
Lacs, considering the exchange rate as on the balance sheet date. The
Company, based on legal advice has disowned such contracts and disputed
such debits as well as future liability with bank. Company is
investigating the transactions and has resorted to suitable legal
remedy, as advised, against the Senior Executive and Bank. Pending the
outcome of the investigations and actions, company has not accounted
the said debits by the bank nor recognized this loss / liability in
books of account.
6. Segment Analysis
The Company operates only in one business segment i.e. Industrial
Minerals. In view of this, no separate disclosure in required under
AS-17.
7. Related party transactions
As required under the Accounting Standard AS - 18 on "Related Party
Disclosures" as notified by The Companies (Accounting Standards) Rules,
2006 are given below:
(A) List of related parties:
a. Enterprises where control exists (subsidiaries):
a. 20 Microns SDN BHD
b. 20 Microns Nano Minerals Limited
c. 20 Microns FZE
b. Enterprises where significant influence exists:
a. DMC Limited (formerly known as Dispersive Minerals and Chemicals
India Limited)
b. Bruno Industrial Products Limited
c. Microns Logistic Private Limited
d. Eriez Finance & investment Limited
e. Aric 20 Microns Infrasonic Private Limited
(formerly known as Eric Finance and Investment Limited)
f. Platy Minerals Private Limited
(formerly known as Trio Techno Minerals Private Limited)
g. Nanotech Minerals India Private Limited
h. Ultra Minechem Equipments Private Limited
i. 20 Microns Foundation Trust.
ii. 20 Microns ESOS Trust.
c. Key Management Personnel
a. Shri C S Parikh - Chairman and Managing Director
b. Shri S R Parikh - Whole Time Director
c. Shri R C Parikh - Managing Director
d. Shri A C Parikh - Jt. Managing Director
d. Relatives of Key Management Personnel:
a. Mrs. I C Parikh - Wife of Shri C S Parikh
b. Shri L R Parikh - Brother of Shri Sudhir Parikh
c. Mrs D S Parikh - Wife of Shri Sudhir Parikh
d. Mrs S R Parikh - Wife of Shri Rajesh C Parikh
e. Ms. V R Parikh - Daughter of Shri Rajesh C Parikh
8. Till the year ended March 31, 2011, the company prepared and
presented the financial statements pursuant to the requirements of the
erstwhile Schedule VI to the Companies Act, 1956. During the year ended
March 31, 2012, the Revised Schedule VI notified under Companies Act
1956, has become applicable to the company. The company has
reclassified previous year figures to confirm to this year's
classification. The adoption of revised Schedule VI does not impact
recognition and measurement principles followed for preparation of
financial statements. However, it significantly impacts presentation
and disclosures made in the financial statements, particularly
presentation of balance sheet.
Mar 31, 2011
1. Secured Loans:
A) Term loan from financial institutions is secured by equitable
mortgage of certain land / plant and machineries of the Company.
B) Facilities from banks comprise of term loan and working capital
facilities, which are secured by equitable mortgage of certain land /
plant and machineries of the Company and against stock and receivable
of the Company.
C) Deferred payment credits for purchase of vehicles are secured by
hypothecation of the respective assets.
D) Term Loan due within one year Rs. 922.48 Lacs (Previous Year Rs. 825.52
Lacs)
F) All the term loans and working capital borrowings are further
collaterally secured by personal guarantee of Chairman
and Managing Director, Managing Director and Joint Managing Director of
the Company.
2. Contingent Liabilities :
(Rs. in Lacs)
SR. PARTICULARS March 31, 2011 March 31, 2010
NO.
1 Demand of Sales Tax
disputed in appeal. 8.59 6.34
2 Claims from Excise authorities not
acknowledged as 148.68 147.68
debt.
3 Demand of Income Tax disputed
in appeal. 168.24 51.48
3. A) Estimated amount of contracts (net of advances Rs.1233.76 lacs)
remaining to be executed on capital account, not provided for amounting
to Rs. 1193.88 lacs (Previous year Rs. 604.11 lacs).
B) Company has given guarantee of Rs. 1250.00 Lacs on behalf of
subsidiary company.
4. Sundry Debtors includes amount of Rs. 89.30 Lacs (Previous Year Rs.
37.78 Lacs) recoverable from a Subsidiary.
5. In the opinion of the management, the current assets, loans and
advances are stated at a value, which is realizable in the ordinary
course of business and provision is made for all known material
liabilities.
6. Due to Micro Small and Medium Enterprises:
7. Gratuity
The following table sets out the status of the gratuity plan as
required under Accounting Standard AS 15 (Revised) Employee Benefits
and the reconciliation of opening balances of the present value of the
defined benefit obligation.
Discount Rate used for valuing liabilities is based on yields (as on
valuation date) of Government Bonds with
tenure similar to the expected working lifetime of the employee.
Estimates of future salary increase are based on inflation, seniority,
promotion and other relevant factors such as demand and supply in the
employment market. This assumption has been determined in consultation
with the company.
This assumption is based on interest rates declared by SBI life
insurance co.ltd. on gratuity funds.
8. Leases
A) The Company has obtained several premises for its business
operations under leave and license agreements. These are generally not
non-cancelable lease and are renewable on mutual consent on mutually
agreeable terms. Lease payments are recognized in the profit and loss
account as rent expenses. The company has taken on finance lease an
office building, having aggregate cost of Rs. 75.20 lacs.
B) The Company has given land and building on operating lease for
period ranging from 11 months to 60 months. During the year, the
company has also given plant and machinery on operating lease and has
recognized the lease rent on both assets in the profit and loss account
amounting to Rs. 22.80 lacs (Previous Year Rs. 14.10 lacs)
9. Related party disclosures as required under the Accounting
Standard AS - 18 on ÃRelated Party Disclosuresà as notified by The
Companies (Accounting Standards) Rules, 2006 are given below:
(A) List of related parties:
(i) Enterprises where control exists: (subsidiaries)
a. 20 Microns SDN BHD
b. 20 Microns Nano Minerals Limited
(ii) Enterprises where significant influence exists:
a. Dispersive Minerals and Chemicals India Limited
b. Bruno Industrial Products Limited
c. Eriez Finance & investment Limited
d. Aric Industrial Products Private Limited
e. Trio Techno Minerals Private Limited
f. Nanotech Minerals India Private Limited
g. Ultra Minchem Equipments Private Limited h. 20 Microns Foundation
Trust.
i. 20 Microns ESOS Trust.
(iii) Key Management Personnel
a. Shri C S Parikh - Chairman and Managing Director
b. Shri S R Parikh - Whole Time Director
c. Shri R C Parikh - Managing Director
d. Shri A C Parikh - Jt. Managing Director
(iv) Relatives of Key Management Personnel:
a. Mrs. I C Parikh - Wife of Shri C S Parikh
b. Shri L R Parikh - Brother of Shri Sudhir Parikh
c. Mrs D S Parikh - Wife of Shri Sudhir Parikh
d. Mrs S R Parikh - Wife of Shri Rajesh C Parikh
10. A) The Company uses forward contracts to hedge its risks
associated with fluctuations in foreign currency and
interest rates. The use of forward contracts is covered by Company's
overall strategy. The Company does not use forward covers for
speculative purposes.
B) Part of the foreign currency loans are covered by comprehensive
hedge which effectively fixes liability of such loans and further there
is no additional risk involved post hedging of such loans.
C) The outstanding forward contracts as at March 31, 2011 is Rs. 1564.94
Lacs (Previous Year Rs. 3412.73 Lacs) in respect of hedging forward
cover.
11. The Company operates only in one business segment i.e. Industrial
Minerals. In view of this, no separate Disclosure is required under
AS -17.
12. Previous years figures have been regrouped, rearranged and
reclassified wherever necessary to make them comparable with those of
current year.
Mar 31, 2010
1. Secured Loans:
A) Term loan from financial institutions are secured by equitable
mortgage of certain land / plant and machineries of the Company.
B) Facilities with bank comprise of term loan and overdraft facilities
which are secured by equitable mortgage of certain land / plant and
machineries of the Company and against stock and receivable of the
Company. "
C) Deferred payment credits for purchase of vehicles are secured by
hypothecation of the respective assets.
D) Term Loan due within one year Rs 825.52 Lacs (Previous Year Rs
433.86 Lacs)
2. Contingent Liabilities :
(Rupees in Lacs)
SR. PARTICULARS MARCH 31, MARCH 31,
NO 2010 2009
1 Demand of Sales Tax
disputed in appeal. 6.34 14.02
2 Claims from Excise
authorities not
acknowledged as debt 147.68 2.29
3 Demand of Income
Tax disputed in
appeal. 51.48 -
3. a) Estimated amount of contracts (net of advances) remaining to be
executed on capital account, not provided for amounting to Rs.604.11 lacs
(Previous year Rs.37.57 lacs).
b) Company has given guarantee of Rs. 1250.00 Lacs on behalf of
subsidiary company.
4. During the year there is change in basis of arriving cost of
inventories from First in First out basis to Weighted Average Basis.
However this change has no material impact on value of Inventories as
on 31st March, 2010
5. Balance of Sundry Debtors - Others, includes amount of Rs 37.78
Lacs (Previous Year Rs. Nil) recoverable from a Subsidiary.
6. In the opinion of the management, the current assets, loans and
advances are stated at a value, which is realizable in the ordinary
course of business and provision is made for all known material
liabilities.
7 Provision for Current Tax is made as per Section 115 JB of the Income
Tax Act, 1961. However, Company is entitled to Minimum Alternate Tax
Credit as per Section 115 J AA of the Income Tax Act, 1961.
8. The Company has indentified enterprises covered under, the Micro,
Small, and Medium Enterprises Development Act, 2006 on the basis of the
confirmation received from such enterprises. The amount payable to such
enterprises is Rs 87.89 Lacs and interest payable to them is Rs 4.32
Lacs (Previous Year 8.30 Lacs).
9. Gratuity
The following table sets out the status of the gratuity plan as
required under Accounting Standard AS 15 (Revised) Employee Benefits
and the reconciliation of opening balances of the present value of the
defined benefit obligation.
10. Related party disclosures as required under the Accounting
Standard AS - 18 on ÃRelated Party Disclosuresà as notified by The
Companies (Accounting Standards) Rules, 2006 are given below:
(A) List of related parties:
(i) Enterprises where control exists:
a. 20 Microns SDN BHD
b. 20 Microns Nano Minerals Limited (w.e.f. February 03, 2010) (ii)
Enterprises where significant influence exists:
a. Dispersive Minerals and Chemicals India Limited
b. Bruno Industrial Products Limited
c. Eriez Finance & investment Limited
d. Aric Industrial Products Private Limited
e. Trio Techno Minerals Private Limited
f. Nanotech Minerals India Private Limited
g. Ultra Minchem Equipments Private Limited h. 20 Microns Foundation
Trust.
i. 20 Microns Nano Minerals Limited (upto February 02, 2010) (iii) Key
Management Personnel
a. Shri C S Parikh - Chairman and Managing Director
b. Shri S R Parikh - Whole Time Director
c. Shri R C Parikh - Managing Director
d. Shri A C Parikh - Jt. Managing Director (iv) Relatives of Key
Management Personnel:
a. Mrs. I C Parikh - Wife of Shri C S Parikh
b. Shri L R Parikh - Brother of Shri Sudhir Parikh
c. Mrs D S Parikh - Wife of Shri Sudhir Parikh
d. Mrs S R Parikh - Wife of Shri Rajesh C Parikh
11. Employees Stock Option Scheme - 2007:
A) The Shareholders of the Company at the Extra Ordinary General
Meeting he d on March 28, 2007, approved the introduction of the
Employees Stock Option Scheme - 2007 (ESOS-2007) for all the eligible
employees of the Company. Under the scheme, 6,22,240 (now revised to
4,33,341 shares in terms of approval of Stock Exchange) Equity Shares
of the Company have been earmarked to be granted. Pursuant to this
approval, the company instituted ESOS-2007 and the compensation
committee of the Company administered this plan.
B) Pursuant to the above scheme, the employee will have the option to
exercise the right within one year from the date of vesting of shares
at Rs. 14 per share, being its exercise price.
12. A) The Company uses forward contracts to hedge its risks
associated with fluctuations in foreign currency and interest
rates. The use of forward contracts is covered by Companys overall
strategy. The Company does not use forward covers for speculative
purposes.
B) Part of the foreign currency loans are covered by comprehensive
hedge which effectively fixes liability of such loans and further there
is no additional risk involved post hedging of such loans.
C) The outstanding forward contracts as at March 31, 2010 is Rs 3412.73
Lacs (Previous Year 648.68 Lacs) in respect of hedging forward cover.
13. The Company operates only in one business segment i.e. Industrial
Minerals. In view of this, no separate Disclosure is required under AS
-17.
14. Previous years figures have been regrouped, rearranged and
reclassified wherever necessary to make them comparable with those of
current year.
Mar 31, 2007
1. Particulars of Contingent Liabilities are as under :
(Rs. in lacs)
Particulars As at As at
31st March 2007 31 st March 2007
- Claims against the
company not NIL NIL
acknowledged as debt.
- Demand of Sales tax
disputed in appeal. 83.48 85.96
- Amount covered by recompense
clause of sanction letter of
SBI as part of overall re
structuring carried out by
CDR cell 80.88 43.16
- Claims from Excise authorities
not acknowledged as debt. 2.29 2.29
# Company has filed an appeal before the Commissioner of sales tax
against the order under the Sales Tax Act and the maximum liability
estimated is Rs. 8 Lacs.
* Company has paid Rs. 10 Lacs as deposit against the said claim.
2. Estimated amount of contracts (net of advances) remaining to be
executed on capital account, not provided for amounting to Rs.15.10
lacs (Previous year Rs.19.12 lacs).
3. In the opinion of the management, the current assets, loans and
advances are stated at a value, which is realizable in the ordinary
course of business and provision is made for all known material
liabilities.
B) Deferred credits are secured by respective assets financed on
personal guarantee of one of the directors of the company.
4A) Based on the information available with the Company regarding the
status of the suppliers as defined under the ÃInterest on Delayed
Payments to Small Scale and Ancillary Industrial Undertaking Act 1993Ã.
The name of the Small Scale and Ancillary Industrial Undertaking to
whom amount are due for more than 30 days from the due date are as
under:
1) Ankur Minerals
2) J B Packaging
3) Parimal Industries
4) Shreeji Microns
5) Adinath Soap Stone Udyog
6) Soham Poly Plast [P] Ltd
7) Ankita Industries
8) Adithya Plastics Industries.
9) Gurukrupa Pulversers
10) H D Enterprises
11) Gajendra Enterprises
12) Ambica Chemicals Industries
13) Indo Talc Micronzed Co
B) Amount due to the Small Scale Industrial undertaking is Rs.49.00
lacs (Previous year Rs.63.43 lacs)
5.A) Managerial Remuneration under Section 198 of the Companies Act,
1956 paid or payable during the year, to the Directors:
B) Since managerial personnel are not paid commission, Computation of
net profit under Section 349 of the Companies Act, 1956 is not stated.
6. Licensed and Installed Capacity.
A) Licensed: License is not required under the Industries (Development
& Regulation) Act.
7. Related party disclosures as required under the Accounting
Standard AS 18 on ÃRelated Party Disclosuresà issued by Institute of
Chartered Accountants of India are given below :
(A) List of related parties :
(i) Key Management Personnel
a. Shri C S Parikh - Chairman and Managing Director
b. Shri S R Parikh - Whole Time Director
c. Shri R C Parikh - Jt. Managing Director (ii) Relatives of Key
Management Personnel :
a. Mrs. Ila C Parikh - Wife of Shri C S Parikh
b. Shri Atil C Parikh - Son of Shri C S Parikh
c. Shri Lalit R Parikh - Brother of Shri Sudhir Parikh
d. Mrs Dharmistha S Parikh - Wife of Shri Sudhir Parikh
e. Mrs Sejal Parikh - Wife of Shri Rajesh C Parikh
(iii) Enterprises where significant influence exists :
a. Specialty Minerals Ltd.
(iv) Enterprises that exercises significant influence over the Company:
a. Gujarat Venture Capital Fund 1995.
8. The Company operates only in one business segment i.e. Industrial
Minerals. In view of this, no separate Disclosure is required under AS
-17.
9. Previous years figures have been regrouped, rearranged and
reclassified wherever necessary to make them comparable with those of
current year.
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