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Notes to Accounts of ABC Bearings Ltd.

Mar 31, 2015

2014-2015 2013-2014 1 Contingent Liabilities not provided for:

a) Demands contested in appeal:

i) Excise Duty and Service tax 21.85 21 85

(ii) Income tax and Fringe Benefit Tax 95.96 97.54

(iii) Sales tax 1.98 16.11

b) Claims against the Company not acknowledged as debt (Including share of jointly con- trolled entity NSK-ABC Bearings Pvt. Ltd. R 4.96 Lacs previous year R6.35 Lacs) 41.38 39 95

2 Excise duty deducted from turnover represents excise duty collected on sale of goods. Excise duty shown under 'expenditure' represents the aggregate of excise duty borne by the Company and difference between excise duty on opening and closing stocks of finished goods.

3 Exceptional item for the year ended 31.03.2014 pertains to excess provision written back for managerial remuneration.

4 The Companies Act, 2013 is applicable for accounting periods commencing from 1st April 2014. Accordingly the Company has realigned the remaining useful life of its fixed assets as prescribed under Schedule II of the Act. Consequently in case of assets having completed their useful life as prescribed by schedule II the carrying values as on 1-4-2014 amounting to Rs.59.95 lakhs (net of deferred tax Rs.29.62 lacs) has been adjusted to retained earnings. In case of other assets the carrying value (net of residual value) is being depreciated over the remaining useful life.

5 Employee benefits

1. Defined contribution plans

a. Provident Fund

b. Superannuation Fund

c. State defined contribution plan

d. Employer's contribution to Employee's state insurance during the year, the Company has recognised the following amounts in the Statement of Profit & Loss.

6 The Company's business activity falls within a single primary segment viz., manufacture of Bearings. As such there are no separate reportable segments as envisaged under Accounting Standard - 17.

7 Related party disclosure as required by Accounting Standard - 18 :

A Related Parties :

Enterprises over which Key Management Personnel have significant influence:

Manoway Investments Pvt. Ltd., Mipco Investments Pvt. Ltd., Maple Investments Co. Pvt. Ltd., Emsons Leasing Co. Pvt. Ltd., Ziwani Properties Pvt. Ltd., Saturn Holdings and Properties Pvt.Ltd., Essex Properties Pvt. Ltd. and NSK - ABC Bearings Pvt Limited(Joint Venture Company)

Key Management Personnel: S. M. Patel, P. M. Patel and T. M. Patel.

Relatives of Key Management Personnel: Meena Patel, Simki Patel and S. Patel.

8 Figures for the previous year have been regrouped/rearranged wherever necessary for comparison and to conform to the classification of the current year.


Mar 31, 2014

1. 2013-2014 2012-2013 Rs.in Lacs Rs.in Lacs

1 Contingent Liabilities not provided for :

i) For guarantee & counter-guarantees to the Bank against Bank''s guarantee to the Government of India and other authorities - 0.25

(ii) Excise Duty demand disputed 54.12 51.78

(iii) Income tax/Fringe Benefit Tax demand contested in appeal 97.54 145.70

(iv) Sales tax demand disputed 16.11 50.88

(v) Claims against the Company not acknowledged as debt (including share of jointly 39.95 32 75 controlled entity NSK-ABC Bearings Ltd. Rs. 6.35 lacs previous year Rs. 5.07 lacs)

2 Estimated amount of contracts remaining to be executed on capital account and not provided for 4449.13 8475.44

3 Excise duty deducted from turnover represents excise duty collected on sale of goods. Excise duty shown under ''expenditure'' represents the aggregate of excise duty borne by the Company and difference between excise duty on opening and closing stocks of finished goods.

4 Exceptional items pertains to difference of remuneration of managerial personnel provided in Financial Years 2011-12 and 2012-13 in terms of their appointment and approval of General Body and remuneration reworked in terms of Central Government approval received and voluntary reduction considered thereto resulting in the write back of excess provision of Rs.374.20 lacs.

5 Disclosures requirement u/s 22 of Micro Small and Medium Enterprises Development Act, 2006:

As on 31-03-2014, the Company owes a sum of Rs. 560.80 Lacs (Previous Year Rs. 589.48 Lacs) to Micro Small and Medium Enterprises. The information has been given in respect of such vendors to the extent they could be identified as " Micro Small and Medium" enterprises on the basis of information available with the Company. No interest is payable on the above outstanding.

6 Employee Benefits

1. Defined contribution plans

a. Provident Fund

b. Superannuation Fund

c. State defined contribution plan

d. Employer''s contribution to Employee''s state insurance during the year, the Company has recognised the following amounts in the Statement of Profit & Loss.

7 The Company''s business activity falls within a single primary segment viz., manufacture of Bearings. As such there are no separate reportable segments as envisaged under Accounting Standard - 17.

8 Figures for the previous year have been regrouped/rearranged wherever necessary for comparison and to conform to the classification of the current period.


Mar 31, 2013

2012-2013 2011-2012 Rs.in Lacs Rs.in Lacs

1 Contingent Liabilities not provided for :

(i) For guarantee & counter- guarantees to the Bank against Bank''s 0.25 32.02 guarantee to the Government of India and other authorities

(ii) Excise Duty demand disputed 51.78 47.42

(iii) Income tax/Fringe Beneft Tax demand contested in appeal 145.70 131.53

(iv) Sales tax demand disputed 50.88 24.91

(v) Claims against the Company not acknowledged as debt 27.68 76.69

2 Estimated amount of contracts remaining to be executed on 8475.44 5634.52 capital account and not provided for

3 The Company has opted for accounting the exchange differences gain/loss arising on long term foreign currency monetary item in line with Companies (Accounting Standards) Amendment Rules, 2009 on "Accounting Standard (AS) 11" notifi ed by Government of India on 31.03.09.

Accordingly the exchange difference lossRs. 101.87 lacs( Previous YearRs. 318.69 lacs) arising on deferred payment credits so far as it relates to depreciable asset is adjusted by addition to the cost of the assets, resulting into higher profi ts for the year (net of depreciation Rs. 4.87 lacs Previous Year Rs. 15.45 Lacs) by Rs. 97 lacs (Previous Year Rs. 303.24 Lacs).

4 Excise duty deducted from turnover represents excise duty collected on sale of goods. Excise duty shown under `expenditure` represents the aggregate of excise duty borne by the Company and difference between excise duty on opening and closing stocks of fi nished goods.

5 (i) Applications are made to the Central Government in respect of :

(a) Mr. S. M. Patel, Executive Chairman, for remuneration fi xed in pursuant to the resolution passed at the Annual General Meeting held on 29th July, 2011 and Special Resolution passed at the Annual General Meeting held on 23td August, 2012 and,

(b) Mr. T. M. Patel, Executive Director , for his reappointment and remuneration fi xed in pursuant to Special Resolution passed at the Annual General Meeting held on 3rd August, 2012.

(ii) The remuneration payable in terms of the above resolutions is to be considered as Minimum Remuneration in absence of profi ts or inadequate profi ts and is subject to the approval of the Central Government which is awaited.

(iii) Meanwhile both Mr. S. M. Patel and Mr. T. M. Patel are paid remuneration with reference to the net profi ts of the Company for the Financial Year subject to overall ceiling as per Section 198 & 309 of the Companies Act, 1956.

6 Disclosures requirement u/s 22 of Micro Small and Medium Enterprises Development Act, 2006:

As on 31-03-2013, the company owes a sum of Rs. 589.48 Lacs (Previous Year Rs. 355.09 Lacs) to Micro Small and Medium Enterprises. The information has been given in respect of such vendors to the extent they could be identifi ed as " Micro Small and Medium" enterprises on the basis of information available with the company. (As on date there are no claims on the Company towards interest on the overdue outstanding.)

7 Employee benefi ts

1. Defi ned contribution plans

a. Provident Fund

b. Superanuation Fund

c. State defi ned contribution plan

d. Employer''s contribution to Employee''s state insurance during the year, the company has recognised the following amounts in the Statement of Profi t & Loss.

8 The Company''s business activity falls within a single primary segment viz., manufacture of Bearings. As such there are no separate reportable segments as envisaged under Accounting Standard - 17.

9 Figures for the previous year have been regrouped/rearranged wherever necessary for comparison and to conform to the lassifi cation of the current period.


Mar 31, 2012

1. 2011-2012 2010-2011 Rs.in Lacs Rs.in Lacs

Contingent Liabilities not provided for :

i) For guarantee & counter- guarantees to the Bank against Bank's guarantee to the Government of India and other authorities 32.02 2.62

(ii) Excise Duty demand disputed 47.42 35.32

(iii) Income tax/Fringe Benefit Tax demand contested in appeal 131.53 98.37

(iv) Property tax demand contested in appeal - 36.19

(v) Sales tax demand disputed 24.91 18.40

(vi) Claims against the Company not acknowledged as debt 76.69 70.37

2. Estimated amount of contracts remaining to be executed on capital account and not provided for 5634.52 7141.72

3. The Company has opted for accounting the exchange differences gain/loss arising on long term foreign currency monetary item in line with Companies (Accounting Standards) Amendment Rules 2009 on "Accounting Standard (AS) 11' notified by Government of India on 31.03.09.

Accordingly the exchange difference loss ' 318.69 lacs arising on deferred payment credits so far as it relates to depreciable asset is adjusted by addition to the cost of the assets including capital work in progress, resulting into higher profits for the year (net of depreciation ' 15.45 lacs) by ' 303.24 lacs.

4. Excise duty deducted from turnover represents excise duty collected on sale of goods. Excise duty shown under expenditure' represents the aggregate of excise duty borne by the Company and difference between excise duty on opening and closing stocks of finished goods.

5. An Application is made to the Central Government in respect of Mr. S. M. Patel, as Executive Chairman and remuneration fixed in pursuance to the resolution passed at the last Annual General Meeting held on 29th July, 2011 and further that in absence of profits or inadequate profits the remuneration so paid be considered as minimum remuneration.

The remuneration provided in terms of aforesaid resolution is subject to the approval of central Government which is awaited. Meanwhile, Mr. S. M. Patel is paid remuneration with reference to net profits of the Company for the financial year subject to overall ceiling as prescribed in Section 198 and 309 of the companies Act, 1956.

6. As on 31-03-2012, the Company owes a sum of ' 355.09 lacs (Previous Year ' 326.69 Lacs) to Micro, Small and Medium Enterprises. The information has been given in respect of such vendors to the extent they could be identified as "Micro, Small and Medium" enterprises on the basis of information available with the Company.

7. The Company's business activity falls within a single primary segment viz., manufacture of Bearings. As such there are no separate reportable segments as envisaged under Accounting Standard - 17.

8. Figures for the previous year have been regrouped/rearranged wherever necessary for comparison and to confirm to the classification of the current period.


Mar 31, 2010

NOTES:

1 Secured by hypothecation of stock-in-trade and book debts and second charge on Plant & Machinery of the Company.

2 Secured by first charge on certain plant and machinery acquired under the Loan and term Deposit with the Bank.

3 Secured by hypothecation of vehicles acquired under the loan.

2009-2010 2008-2009 Rupees Rupees in lacs in lacs

B. CONTINGENT LIABILITIES AND NOTES TO ACCOUNTS

1 Contingent Liabilities not provided for:

i) For counter-guarantees to the Bank against Banks guarantee to the Government of India and other authorities 1.21 2.81

ii) Excise Duty demand disputed 6.42 6.74

iii) Income tax/Fringe Benefit Tax demand contested in appeal 162.62 155.65

iv) Property tax demand contested in appeal 30.65 26.83

v) Sales tax demand disputed 74.41 32.60

2 Estimated amount of contracts remaining to be executed on capital account and not provided for 2429.77 1764.01

3 The Company has opted for accounting the exchange differences gain/loss arrising on long term foreign currency monetary item in line with Companies (Accounting Standards) Amendment Rules 2009 on "Accounting Standard (AS) 11" notified by Government of India on 31.03.09.

Accordingly the exchange difference gain Rs.44.92 lacs arising on deferred payment credits so far as it relates to depreciable asset is adjusted by deduction to the cost of the assets. Had such option not been exercised the profit for the year (including depreciation Rs. 1.95 lacs) would have been less by Rs.46.87 lacs.

4 Exceptional item pertains to consideration received from Licensor in terms of licence Termination Agreement for cessation of production of certain licensed products.

5 As on 31-03-2010, the company owes a sum of Rs.653.31 lacs (Previous Year 420.13 Lacs) to Micro Small and Medium Enterprises. As on date there are no claims on the Company towards overdue interest on the above outstanding.

The above information has been given in respect of such vendors to the extent they could be identified as "Micro Small and Medium" enterprises on the basis of information available with the company.

6 Employee benefits

1. Defined contribution plans

a. Provident Fund

b. Superannuation Fund

c. State defined contribution plan

Employers contribution to Employees state insurance

7 The Companys business activity falls within a single primary segment viz., manufacture of Bearings. As such there are no separate reportable segments as envisaged under Accounting Standard - 17.

8 Figures for the previous year have been regrouped wherever necessary for comparison.

9 Figures in italics are in respect of previous year.

10 Information pursuant to Part IV of Schedule VI to the Companies Act, 1956 is attached herewith.

 
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