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Notes to Accounts of Action Construction Equipment Ltd.

Mar 31, 2016

1. Additional Notes to the Financial Statements

27(A) Significant Accounting Policies

1. System of Accounting:

The Financial Statement has been prepared to comply with the mandatory Accounting Standards issued by The Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 2013.The financial statements are prepared on going concern assumptions and under the historical cost convention on accrual basis except in case of assets for which revaluation is carried out. The accounting policies have been consistently applied by the company unless otherwise stated.

2. Fixed Assets:

All Fixed Assets are valued at historical costs less accumulated depreciation. Cost of assets comprise of purchase price and any attributable cost of bringing the asset to its working condition except in case of assets for which revaluation is carried out.

3. Depreciation:

Depreciation is systematically allocated over the useful life of an asset as specified in part C of schedule II of Companies Act, 2013.

4. Investments:

Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. All other investments are classified as long-term investments. Current investments are carried at lower of cost or fair value determined on an individual investment basis.

Long-term investments are carried at cost. However, provision made for diminution in the value of the investments is made to recognize a decline other than temporary.

5. Inventories:

(a) Raw Material- Lower of cost or net realizable value. However, materials and other items held for use in the production of finished goods are not written down below cost, if finished product in which they will be incorporated are expected to be sold at or above cost. Cost is determined on weighted average basis.

(b) Work in Progress and Finished Goods - Lower of cost or net realizable value. Cost includes direct materials, labour and proportion of manufacturing overheads based on normal operating capacity. Cost is determined on a weighted average basis. Net Realizable value is the estimated selling price in ordinary course of business, less estimated costs necessary to make the sale.

6. Revenue Recognition:

Revenue is recognized to the extent it is probable that the economic benefits will flow to the company and revenue can be reliably measured.

(a) Sale of Goods: Revenue in respect of sale of products is recognized at the time of dispatch of the goods, when significant risks and rewards of ownership of the goods is passed to the buyers.

(b) Rendering of Services: Revenue from service is recognized when the service is performed, as per the terms of contract, and the performance of service is regarding as achieved when no significant uncertainty exists regarding the amount of consideration that will be derived from rendering the services.

(c) Interest: Revenue is recognized on a time proportion basis taking into account the amount outstanding and rate applicable.

(d) Insurance Claims: Receivable on account of insurance are accounted for to the extent the company is reasonably certain of their ultimate collection.

(e) Export Benefits: Export benefits under Duty Drawback Scheme are accounted for in the year of Export of Goods.

7. Foreign Currency Transactions:

a) Initial recognition: Foreign currency transactions are recorded in the reporting currency, by applying the foreign currency amount the exchange rate prevailing at the date of transaction.

b) Conversion: Foreign currency monetary items are reported using the closing rate, Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in foreign currency are reported using the exchange rates that existed when the value is determined.

c) Exchange Differences: Exchange differences arising on reporting monetary items of company at the rate different from those at which they were initially recorded during the year, or reported in previous financial statements, are recognized as income or as expenses in the year in which they arises. However, exchange difference arising on reporting of “Long Term Foreign Currency Monetary Item (LTFCMI)" in so far as they relate to acquisition of capital assets are added to or deducted from the cost of the asset and shall be depreciated over the useful life of that asset and in other cases, such difference are accumulated in "Foreign Currency Monetary Item Translation Difference Account (FCMITDA)" and amortized over the balance period of such long term asset/liability.

8. Benefits to Employees:

a) Short-term Employee Benefit:

All employees benefits payable with in twelve month of rendering of the service are classified as short-term benefits. Such benefits include salaries, wages, bonus, short-term compensated absences, awards, exgratia etc. and are recognized in the period in which the employee renders the related service.

b) Post Employment benefits:

(i) Defined Contribution Plans:

The Company''s State government Provident Fund Scheme and Employee State Insurance Scheme are defined contribution plans. The contribution paid/ payable under the scheme is recognized during the period in which the employee renders the related service.

(ii) Defined Benefits Plans:

The employee''s gratuity fund scheme, long term compensated absences are company''s defined benefit plans. The present value of the obligation under such defined benefit plans are determined based on the actuarial valuation on the date of the balance sheet. Gratuity Liability is funded through a Group Gratuity Scheme with Life Insurance Corporation of India wherein contributions are made and charged to revenue on annual basis.

9. Accounting for Taxes on Income:

Tax expense comprises of current and deferred tax. Current tax is measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act,1961. Deferred income tax reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years and has been accounted as per provisions of the Accounting Standard-22 issued by The Institute of Chartered Accountants of India. In accordance with the guidance note issued by ICAI, the company will review the outstanding MAT credit entitlements at each balance sheet date and write down the carrying amount of MAT Credit entitlement to the extent there is no longer convincing evidence to the effect that Company will pay normal Income Tax during the specified period.

10. Impairment of Assets:

The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized, wherever carrying amount of an asset exceeds its recoverable value. The recoverable value is greater of the asset''s net selling price or value in use. In assessing value in use, the estimated future cash flows are discounted to their present value at weighted average cost of capital.

After impairment, depreciation is provided on the revised carrying amount of the assets over its remaining useful life.

11. Borrowing Costs:

Borrowing costs that are attributable to the acquisition and construction of an assets that necessarily takes substantial period of time to get ready for its intended use are capitalized as part of cost of respective assets. All other borrowing costs are recognized as expenses in the year in which they are incurred. Borrowing Cost consists of interest and other costs that an entity incurs in connection with the borrowing of funds.

12. Expenditure during Construction Period:

In case of new projects/substantial expansions of existing factories, expenditure incurred, including trial production expenses net of revenue earned and attributable interest and financing costs prior to commencement of commercial production are capitalized.

13. Provisions, Contingent Liabilities and Contingent Assets:

Provisions are recognized for liabilities that can be measured only by using a substantial degree of estimation, if

a) the Company has a present obligation as a result of a past event;

b) a probable outflow of resources is expected to settle the obligation and;

c) the amount of obligation can be reliably estimated;

Reimbursements expected in respect of expenditure required to settle a provision is recognized only when it is virtually certain that the reimbursement will be received.

Contingent Liability is disclosed in case of

a) a present obligation arising from the past event, when it is not probable that an outflow of resources will be required to settle the obligation;

b) a possible obligation, of which the probability of outflow of resources is remote.

Contingent Assets are neither recognized nor disclosed.

Provisions, Contingent Liabilities and Contingent Assets are reviewed at each Balance Sheet date.

27(B) Other Notes

11 The Board of Directors have declared an interim dividend of Rs. 0.20/- (10%) per Equity Share, subject to approval of the Share holders in the forthcoming Annual General Meeting.

12 The Ministry of Science & Technology (Department of Scientific and Industrial Research) vide its letter no. TU/IV-RD/3115/2016 dated 27.04.2016 has renewed the recognition up to 31.03.2019 to our In-House R&D centre’s. The expenditure incurred towards In-House Research & Development activity is as under:

13 Miscellaneous Expenditure to the extent not written off, includes Life Time Club Membership, to be amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The Institute of Chartered Accountants of India.

14 In absence of any information received from the vendors with regards to their registration (filing of Memorandum) under ''The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability at the close of the year cannot be ascertained and during the year no interest is paid to any such enterprises.

*The Company has been advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.

Capital Commitment: Estimated amount of contracts pending to be executed on capital account and not provided for Rs. 133.75 lacs (Previous Year Rs. 177.27 lacs).

15. Remuneration paid to Whole-time Directors:

* The above mentioned remuneration is in excess of maximum permissible remuneration as determined under Section 197 of the Companies Act, 2013 read with Schedule of the Companies Act, 2013. The Company has since received approval of the Central Government for payment of above remuneration to Mr. Vijay Agarwal, Chairman & Managing Director and Mrs. Mona Agarwal, Whole-time Director up to 30"'' Sept, 2015 and for remaining period. The company has applied to the Central Government on 21" March, 2016 & 22"d March, 2016 respectively for necessary Central Government approval. Management has taken confirmation from both the directors that they shall refund the excess remuneration in the event of refusal of such approval.

16. Disclosure of amalgamation in terms of accounting standard 14 issued by Institute of Chartered Accountants of India

Pursuant to scheme of amalgamation (''the scheme'') of ACETC Rentals Private Limited (''the amalgamating company'') with the Action Construction Equipment Limited (''the company'') under Section 391 and 394 of the Companies Act, 1956 as sanctioned by Hon''ble High Court of Punjab & Haryana vide its order CP No. 128 of 2015 dated 17th November, 2015, entire business and all assets and liabilities of the amalgamating company were transferred and got vested in the Company effective from 01st April, 2014, accordingly the scheme has been given effect to in these financial results.

As per Accounting Standard 14, "Accounting for Amalgamations" issued by the Institute of Chartered Accountants of India, the additional disclosures required to be made in the first financial statements following the amalgamation are as follows:

(a) Company has issued and allotted to the members of the amalgamating company 1168 fully paid up equity shares of Rs. 2 each for every 100 fully paid up equity shares of Rs 10/- each held by the Members whose names appear in the Register of Members as on the record date. Thus a total of 1,83,83,000 new equity shares of Rs. 2 each and 3,02,19,380 - 8% cumulative nonparticipating redeemable preference shares of Rs. 10 each have been issued to the shareholders of the amalgamating company to effect the amalgamation.

(c) The figures for the current year includes figures of the amalgamating company and therefore up to that extent current year figures are not comparable with the previous year.

17. As per Accounting Standard 18, "Related Party Disclosure" issued by The Institute of Chartered Accountants of India, the disclosures of transactions with the Related Parties as defined in the Accounting Standard are given below:

a. Associate Companies / Entities

Namo Metals

VMS Equipment Pvt. Ltd.

b. Subsidiary Companies

FRESTED Limited, Cyprus - Wholly Owned Subsidiary SC FORMA SA, Romania - Fellow Subsidiary

c. Key Management Personnel

Sh. Vijay Agarwal Smt. Mona Agarwal Sh. Sorab Agarwal Smt. Surbhi Garg

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence

N.A.

18. The Company has entered into agreements in the nature of Lease/ Leave and License agreement with different Lesser/ Licensors for the purpose of establishment of office premises/ residential accommodations. These are generally in nature of operating Lease/leave and License and disclosure required as per Accounting Standard-19 issued by The Institute of Chartered Accountants of India with regard to the above is as under-

b) There are no transactions in the nature of Sub Lease.

c) Payments recognized in the Statement of Profit & Loss for the year ended 31st March, 2016 is Rs. 160.90 Lacs (P.Y. Rs. 149.05 Lacs).

19. Disclosure pursuant to Accounting Standard -15 (Revised), issued by The Institute of Chartered Accountants of India EMPLOYEE BENEFITS

e) Actuarial Assumption

a) Discounted Rate 7.85% p.a.

b) Mortality Rate IAL (2006-08) Ultimate

c) Withdrawal Rate 1% to 3% depending on Age.

d) Salary Escalation 11.00%

e) Retirement Age 58

Liability in respect of unveiled privileged leave was hitherto valued at the salary rates prevailing on the balance sheet date. During the year, the company has valued the compensated absences, specified in AS 15 (Revised) on actuarial basis. Further para 132 of AS 15 (Revised 2005) does not require any specific disclosure except where the expense resulting from compensated absences is of such size, nature of incidence that its disclosure is relevant under other accounting standards. In the opinion of the management, the expense resulting from compensated absences is not significant and hence no disclosures are prepared under various paragraphs of AS 15 (Revised 2005).

20 Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act,2013 read with Schedule VII thereof Rs. 156.72 Lacs (previous year Rs. 125.50 Lacs).

21 Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the financial Statements for the year.

22 The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

23 The figures for the current year includes figures of ACE TC Rentals Pvt. Ltd. which is amalgamated with the company w.e.f. from 1st April, 2014 as per the scheme of amalgamation (''the scheme'') sanctioned by the Hon''ble High Court of Punjab Haryana and are therefore up to that extent current year figures are not comparable with those of previous year.

24 Note 1 to27form integral part of the accounts and are duly authenticated.


Mar 31, 2015

Terms of Repayment

a) Foreign Currency Loan - Repayable in 16 equal instalments of USD 156250 & USD 125000 each, starting after 15 months from the date of disbursement i.e. 30th June 2011 & 1st Sep 2011 respectively with interest rate of USD LIBOR 2.65%

b) i. Rupee Loan from ICICI Bank Ltd. - Repayable in 118 equated monthly instalments, (including interest @ 10.20%) starting from 10.04.2012

i. Rupee Loan from Axis Bank Ltd. - Repayable in 12 quarterly instalments of Rs. 2.08 crores each, last being Rs. 2.12 crores starting after one year from the date of first disbursement and carry an interest of 10.90% p .a.

ii. Commercial Equipment Loan from ICICI & FIDFC Bank - Repayable in 47 equated monthly instalments (including interest @ 10.05%)

Security Offered

a) i) Exclusive charge on assets financed out of this Loan.

ii) Exclusive charge on Immovable assets at industrial unit at Plant IV, Prithla Dhatir Road, Village Dudholla, Palwal.

b) i) Exclusive charge on theassetsfinanced out of this loan.

ii) a) Exclusive charge on theassetsfinanced out of this loan.

b) Exclusive charge by way of e quitable mortgage over factory land situated at Kashipur, Uttarakhand.

ii) Exclusive hypothecation on the Commercial Equipment financed out of these loan.

All Credit Facilities from Banks are secured by way of hypothecation of the Company's entire inventory and such other movable including book-debts, bills whether documentary or clean, outstanding monies, receivables, both present & future and Plant & Machinery (Except Plant & Machinery financed out of foreign currency loan and rupee term loan) on pari passu basis and First charge by the way of equitable mortgage of property situated at Mumbai on pari passu basis.

2 Merger

ACET C Rentals Pvt. Limited is proposed to b e m erged with the Company with effect from April 1 s t, 2014 pursuant to a sc heme of amalgamation ("these heme"). These heme has been filed in the Hi gh Court for the S tates of Punjab and H aryana and H on'able High Court has directed to c onvenethe m eeting of the m embers of the Company and unsecured c reditors having n et b alance of more than Rs. 1 lacs on July 4th, 2015. Accordingly, these financial s tatements do n ot include the assets and liabilities of ACET C Rentals Pvt. Limited as at M arch 31st, 2015 and the results of operations for they ear ended M arch 31st, 2015.

3(A) Other Notes 1 The Board of Director's has recommended a final dividend of Rs. 0.20/- (10%) per Equity Share, subject to approval of the Share Holders in the forthcoming Annual General Meeting.

4 Miscellaneous Expenditure to the extent not written off, includes Life Time Club Membership, to be amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The Institute of Chartered Accountants of India.

5 In absence of any information received from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability at the close of the year cannot be ascertained and during they ear no in terest is paid to any such enterprises.

6. Contingent Liabilities, not provided for:

Rs. in Lacs

Particulars Year Ended Year Ended 31st March, 2015 31st March, 2014

Bank Guarantees 1,557.75 1,220.95

Letter of Credits 783.32 1,900.71

Claim against the Company, not acknowledge as Debts* 442.24 558.98

Sales Tax, Excise & Income Tax Matters, pending before 2,922.28 5,363.61

Assessing / Appellate Authorities*

Total 5,705.59 9,044.25

*The Company has been advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision is considered necessary.

Capital Commitment: Estimated amount of contracts pending to be executed on capital account and not provided for Rs. 177.27 lacs (PreviousYear Rs.703.71 lacs).

b) The above mentioned remuneration of Rs. 455.80 Lacs is in excess of Maximum permissible remuneration as determined under Schedule V of the Companies Act, 2013. However the company has filed an application with the Central Government on dated 3rd February 2015 for grant of approval for payment of same remuneration as paid in the past to Mr. VijayAgarwal, Chairman & Managing Director and Mrs. Mona Agarwal, Whole time Director of the Company. Pending approval from the government, management has taken confirmation from both the directors that they shall refund the excess remuneration in the event of refusal of such approval.

7. As per Accounting Standard 18, "Related Party Disclosure" issued by The Institute of Chartered Accountants of India, the disclosures of transactions with the Related Parties as defined in the Accounting Standard are given below:

a. Associate Companies / Entities

ACE TC Rentals Pvt. Ltd.

Namo Matels

VMS Holdings Pvt. Ltd.

VMS Equipment

b. Subsidiary Companies

FRESTED Limited, Cyprus - Wholly Owned Subsidiary SC FORMA SA, Romania - Fellow Subsidiary

Action Developers Ltd., India - Wholly Owned Subsidiary (Ceased to exist on 23-02-2015)

c. Key Management Personnel

Sh. Vijay Agarwal Smt. Mona Agarwal Sh. Sorab Agarwal Smt. Surbhi Garg

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence

N.A.

8. The Company has entered into agreements in the nature of Lease/ Leave and Licence agreement with different Lessors/ Licensors for the purpose of establishment of office premises/ residential accommodations. These are generally in nature of operating Lease/leave and Licence and disclosure required as per Accounting Standard-19 issued by The Institute of Chartered Accountants of India with reaard to the above is as under-

b) There are no transactions in the nature of Sub Lease.

c) Payments recognised in the Statement of Profit & Loss for the year ended 31st March, 2015 is Rs. 149.05 Lacs (P.Y Rs. 165.15 Lacs).

9. Disclosure pursuant to Accounting Standard -15 (Revised), issued by The Institute of Chartered Accountants of India

10 Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with ScheduleVII thereof: Rs 125.50 Lacs.

11 Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, M anagement does not expect any material difference in the financial S tatements for they ear.

12 The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

13 The Trade Receivables includes an amount of Rs. 649.43 lacs (Previous year Rs. 444.28 lacs) due from Companies in which Directors are interested.

14 Previous years figures have been regrouped to make them comparable with currentyear figures wherever necessary.

15 Note 1 to 27 form integral part of the accounts and are duly authenticated.




Mar 31, 2014

1 The Board of Director''s has recommended a final dividend of Rs. 0.10/- (5%) per Equity Share, subject to approval of the Share Holders in the forthcoming Annual General Meeting.

2. Miscellaneous Expense to the extent not written off, includes Life Time Club Membership, to be amortized over a period often years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The Institute of Chartered Accountants of India.

3. In absence of any information received from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability at the close of the year cannot be ascertained and during the year no interest is paid to any such enterprises.

4. Contingent Liabilities, not provided for:

Rs. in Lacs

Particulars Year Ended Year Ended 31st March, 2014 31st March, 2013

Bank Guarantees 1,220.95 898.31

Letter of Credits 1,900.71 1,897.24

Claim against the Company, not acknowledge as Debts 558.98 697.07

Sales Tax, Excise & Income Tax Matters, pending before 5,363.61 3,980.85 Assessing / Appellate Authorities

Total 9,044.25 7,473.47

Capital Commitment: Estimated amount of contracts pending to be executed on capital account and not provided for Rs.703.71 lacs (Previous Year Rs.619 lacs).

b) The above mentioned expenses for Rs.455.80 lac (Previous Year Rs. 455.82 lacs) is towards director remuneration . This amount is in excess of permissible remuneration determined under section XIII of the Companies Act, 1956. Management had filed an application with the Central Government on 14th March 2013 for approval of payment of the salary for paying same remuneration as paid in the past to Mr. Vjay Agarwal, Chairman & Managing Director and Mrs. Mona Agarwal, Whole time Director of the Company. Company has received approval for Mr Vijay Agarwal vide SRN No. B70175369/2013-CL-VII dated 21.11.2013 under section 310 for payment of increased remuneration of Rs 235.06 lacs for financial year 2012-13 and Rs 267.40 lacs for financial year 2013-14 & approval the payment to Mrs. Mona Agarwal vide SRN No. B70093851/2013-CL-VII dated 06-11 -2013 for payment of increased remuneration of Rs 135.96 lacs per annum for a period of 2 (two) years w.e.f. 01.04.2012 to 31.03.2014. Company has recovered Rs. 32.34 lacs in FY 2013-14 (against total Director remuneration of Rs. 455.80 lacs of current year) which was excess paid in F.Y 2012-13 from permissible limit of Rs. 235.06 lacs from Mr. Vijay Agarwal.

5. As per Accounting Standard 18, "Related Party Disclosure "issued by The Institute of Chartered Accountants of India, the disclosures of transactions with the Related Parties as defined in the Accounting Standard are given below.

a. Associate Companies / Entities

ACE TC Rentals Pvt. Ltd.

Namo Metals

VMS Holdings Pvt. Ltd.

VMS Equipment

b. Subsidiary Companies

FRESTED Limited, Cyprus - Wholly Owned Subsidiary

SC FORMA SA, Romania - Fellow Subsidiary

Action Developers Ltd., India - Wholly Owned Subsidiary

c. Key Management Personnel

Sh. Vijay Agarwal

Smt. Mona Agarwal

Sh. Sorab Agarwal

Smt. Surbhi Garg

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence

N.A.

6. Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the financial Statements for theyear.

7. The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

8. Previous year’s figures have been regrouped to make them comparable with current year figures wherever necessary.

9. Note 1 to 27 form integral part of the accounts and are duly authenticated.


Mar 31, 2013

1. The Board of Director''s has recommended a dividend of Rs.0.20/- (10%) per Equity Share, subject to approval of the Share Holdersinthe forthcoming Annual General Meeting.

2. Outof Rs. 5,980 Lacs raised through IPO, all IPO proceeds have been utilisedby company as at 31st Mar 2013.

3. The Ministry of Science & Technology (Department of Scientific and Industrial Research) vide its letter no. TU/IVRD/3115/2010 dated 09.03.2011 and TU/IV-RD/3115/2012 dated 25.04.2012 has accorded the recognition as In- House R&D centres in the previous years. The expenditure incurred towards In-House Research & Development activity is as under:

4. Consequent upon the sanctioning of Scheme of Amalgamation of Ace Steel Fab (P) Ltd w.e.f 1st Oct 2011 with the Company, figures of the company after the date of amalgamation also includes the figures of Ace Steel Fab Pvt Limited and therefore the figures for the financial year 2012-13 are not comparable with the corresponding year.

5. Miscellaneous Expense to the extent not written off, includes Life Time Club Membership, to be amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The institute of Chartered Accountantsof India.

6. In absence of any information received from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability at the close of the year cannot be ascertained and during the year nointerestis paidtoany such enterprises.

7. Contingent Liabilities, not provided for: Rs. in Lacs

Particulars Year Ended Year Ended 31st March, 2013 31st March, 2012

Bank Guarantees 898.31 799.98

Letter of Credits 1,897.24 2,614.34

Claim against the Company, not acknowledge as Debts 697.07 478.19

Sales Tax, Excise & Income Tax Matters, pending before 3,980.85 3,201.49

Assessing / Appellate Authorities

Total 7,473.47 7,094.00

Capital Commitment: Estimated amount of contracts pending to be executed on capital account and not provided for is Rs. 619 lacsinthe current year.

8. As per Accounting Standard 18, "Related Party Disclosure "issued by The Institute of Chartered Accountants of India, the disclosuresof transactions with the Related Partiesasdefinedinthe Accounting Standard are given below.

a. Associate Companies / Entities

ACE Steelfab Pvt. Ltd. (Upto 30.09.2011)

ACE TC Rentals Pvt. Ltd.

Namo Metals

VMS Holdings Pvt. Ltd.

VMS Equipment

b. Subsidiary Companies

FRESTED Limited, Cyprus - Wholly Owned Subsidiary

SC FORMA SA, Romania - Fellow Subsidiary

Action Developers Ltd., India - Wholly Owned Subsidiary

c. Key Management Personnel

Sh. Vijay Agarwal Smt. Mona Agarwal Sh. Sorab Agarwal Smt. Surbhi Garg

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence N.A.

9. Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the Financial Statements for the year.

10. The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute ofChartered AccountantsofIndia.

11. Previous years figures have been regrouped tomake them comparable with current year figures wherever necessary.

12. Notes1 to27 form integral part ofthe accounts and are duly authenticated.


Mar 31, 2012

Terms of Repayment

a) Foreign Currency Loan - Repayable in 16 equal Instalments starting after 15 months from the date of disbursement.

b) Rupee Loan - Repayable in 120 equated monthly instalments, including interest.

Security Offered

a) (i) Exclusive Charge on assets financed out of this Loan.

(ii) Exclusive Charge on Immovable assets at industrial unit at Plant IV, Prithla Dhatir Road, Village Dudholla, Palwal.

b) Exclusive Charge on the assets financed out of this Loan.

All Credit Facilities from Banks are secured by way of hypothecation of the Company's entire inventory and such other movable including book-debts, bills whether documentary or clean, outstanding monies, receivables, both present & future and Plant & Machinery (Except Plant & Machinery financed out of Foreign Currency Loan) on pari passu basis and First charge by the way of equitable mortgage of property situated at Bazpur on pari passu basis.

Notes:

1) Addition to gross block during the current financial year, of Rs. 9,161.74 Lacs, includes assets of Rs. 1,425.42 Lacs purchased in the Scheme of amalgamation.

2) During the financial year ended 31st March 2011, Land & Building was revalued by Rs. 5,697.05 Lacs on the basis of valuation carried out by an approved valuer.

1. The revised Schedule VI has become effective from 1stApril, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.

2. The Board of Director's has recommended a dividend of Rs.0.20 (10%) per equity share, subject to approval of share holders.

3. Pursuant to the order No.9885 dated 21st July 2012 passed by Hon'ble High Court of Delhi, M/s ACE SteelFab Pvt Ltd has merged with M/s Action Construction Equipment Limited w.e.f. 1st Oct, 2011.

As per Accounting Standard 14, "Accounting for Amalgamations" issued by The Institute of Chartered Accountants of India, the additional disclosures required to be made in the first financial statements following the amalgamation are as follows:

a) Company has issued and allotted to the members of ACE Steelfab Private Ltd 24.22 equity shares of Rs.2/-each at par for every 1 fully paid equity share of Rs.10 each held by the members whose names appear in the register of members as on the record date, or to such of their respective heirs, executors, administrators or other legal representatives or other successors in title as may be recognised by the board. Thus a total of 60,55,000 Equity shares has been issued to share holders of M/s ACE Steelfab Pvt Ltd to effect the amalgamation.

4. Out of Rs.5,980 Lacs raised through IPO, Rs.5,976 Lacs have been utilized till 31st March, 2012 and balance amount is lying unutilised & will be utilised as per amendments made to "Proposed Deployment of Funds" by the share holders of the Company in its Annual General Meeting held on 1st August, 2008. The Share holders of the Company has authorised the Board of Directors to utilise remaining IPO proceeds in the best interest of the Company.

5. During the current financial year Company has setup a dedicated R&D centre at Jajru Road and this is in addition to in- house R&D Centre already setup at Dhudhola Factory Premises. Both the R&D centres are recognised by the Ministry of Science & Technology (Department of Scientific and Industrial Research) vide its letter no.TU/IV-RD/3115/2010 dated 09.03.2011 and TU/IV-RD/3115/2012 dated 25.04.2012 respectively. The expenditure incurred towards In-House Research & Development activity is as under:

6. Miscellaneous Expense to the extent not written off, includes Life Time Club Membership, to be amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The institute of Chartered Accountants of India.

7. In absence of any information received from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability at the close of the year cannot be ascertained and during the year no interest is paid to any such enterprises.

8. Contingent Liabilities, not provided for:

Rs. in Lacs

Particulars Year Ended Year Ended 31st March 2012 31st March 2011

Bank Guarantees 799.98 385.02

Letter of Credits 2,614.34 3,073.97

Claim against the Company, not acknowledge as Debts 478.19 327.90

Sales Tax, Excise & Income Tax Matters, pending before 3,201.49 1,095.93 Assessing / Appellate Authorities

Total 7,094.00 4,882.82

9. As per Accounting Standard 18, "Related Party Disclosure "issued by The Institute of Chartered Accountants of India, the disclosures of transactions with the Related Parties as defined in the Accounting Standard are given below.

a. Associate Companies / Entities

ACE Steelfab Pvt. Ltd. (Upto 30.09.2011)

ACE TC Rentals Pvt. Ltd.

Namo Metals

VMS Holdings Pvt. Ltd.

b. Subsidiary Companies

FRESTED Limited, Cyprus - Wholly Owned Subsidiary

SC FORMA SA, Romania - Fellow Subsidiary

Action Developers Ltd., India - Wholly Owned Subsidiary

c. Key Management Personnel

Sh. Vijay Agarwal

Smt. Mona Agarwal

Sh. Sorab Agarwal

Smt. Surbhi Garg

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence

N.A.

10. Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the Financial Statements for the year.

11. The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

12. Notes 1 to 27 form integral part of the accounts and are duly authenticated.


Mar 31, 2011

1. Out of the Funds raised through IPO Rs. 5980 lac, Rs. 5976 lac (see annexure) have been utilized till 31st March, 2011 and balance amount is lying unutilised & will be utilised as per amendments made to "Proposed Deployment of Funds" by the shareholders of the Company in its Annual General Meeting held on 1st August, 2008. The Shareholders of the Company has authorised the Board of Directors to utilise remaining IPO proceeds in the best interest of the Company.

2. The Board of Director's has recommended a final dividend of Rs.1/- (50%) per Equity Share, subject to approval of the Share Holders. The Board has already declared an interim dividend of Rs.1/- (50%) per Equity Share thus, the total Dividend for the year 2010-11 would be Rs.2/- (100%) per Equity Share.

3. Miscellaneous Expense to the extent not written off, includes Life Time Club Membership, to be amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The Institute of Chartered Accountants of India.

4. In absence of any information requested from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability can not be ascertained at the close of the year and hence no disclosures have been made in this regards.

5. Contingent Liabilities, not provided for:

(Rs. in lacs)

Particulars 2010-11 2009-10

Bank Guarantees including Corporate Guarantees 385.02 571.53

Letter of Credits 3,073.97 1,382.49

Claim against the Company, not acknowledge as Debts 327.90 185.38

Sales Tax, Excise & Income Tax Matters, pending before 1,095.93 107.52 Assessing / Appellate Authorities

Total 4,882.82 2,246.92

6. All Credit Facilities from Banks are secured by way of hypothecation of the Company's entire stocks of raw materials, semi-finished and finished goods, consumable stores and spares and such other movable including book-debts, bills whether documentary or clean, outstanding monies, receivables, both present & future and Plant & Machinery on pari passu basis and First charge by way of equitable mortgage of property situated at Jajru Road. 25th Mile Stone, Delhi Mathura Road, Ballabhgarh, Haryana on pari passu basis.

7. Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the Financial Statements for the year.

8. The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

9. Previous years figures have been regrouped to make them comparable with current year figures wherever necessary.

10. Schedules 1 to 16 form integral part of the accounts and are duly authenticated.


Mar 31, 2010

1. Out of the Funds raised through IPO Rs. 5980 lac, Rs. 5976 lac (see annexure) have been utilized till 31st March, 2010 and balance amount is lying unutilised & will be utilised as per amendements made to "Proposed Deployment of Funds" by the shareholders of the Company in its Annual General Meeting held on 1st August, 2008. The Shareholders of the Company has authorised the Board of Directors to utilise remaining IPO proceeds in the best interest of the Company.

2. The Board of Directors, in its meeting held on 6th Apr10, has recommended interim dividend for FY. 2009-10 @Rs. 1/- per Equity Share of Rs. 2 each (50%).

3, Miscellaneous Expense to the extent not written off, includes Life Time Club Membership, being amortized over a period of ten years, commencing from 2007-08, in accordance with Accounting Standard 26 issued by The institute of Chartered Accountants of India.

4, In absence of any information requested from the vendors with regards to their registration (filing of Memorandum) under "The Micro, Small and Medium Enterprises Development Act, 2006 (27 of 2006)", liability can not be ascertained at the close of the year and hence no disclosures have been made in this regards.

5. Contingent Liabilities, not provided for: (Rs. in lac)

Particulars 2009-10 2008-09

Bank Guarantees including Corporate Guarantees 571.53 293.80

Letter of Credits 1,382.49 195.33

Claim against the Company, not acknowledge as Debts 185.38 148.43

Sales Tax, Excise & Income Tax Matters, pending before 107.52 28.33 Assessing / Appellate Authorities

2,246.92 665.89

6, As per Accounting Standard 18, "Related Party Disclosure "issued by The Institute of Chartered Accountants of India, the disclosures of transactions with the Related Parties as defined in the Accounting Standard are given below-

a. Associate Companies / Entities- ACE Steelfab Pvt. Ltd.

ACE TC Rentals Pvt. Ltd. Namo Metals

b. Subsidiary Companies. FRESTED Limited, Cyprus Wholly Owned Subsidiary SC FORMA SA, Romania

Fellow Subsidiary

Action Developers Ltd., India

Wholly Owned Subsidiary

c. Key Management Personnel- Sh. Vijay Agarwal

Smt. Mona Agarwal Sh. Sorab Agarwal Sh. VK Singh

d. Relatives of Key Management Personnel and Enterprises, over which Relatives of Key Management Personnel exercise significant influence- Smt. Surbhi Garg

7. The Company has entered into agreements in the nature of Lease/ Leave and Licence agreement with different Lessors/ Licensors for the purpose of establishment of office premises/ residential accomodations. These are generally in nature of operating Lease/leave and Licence and disclosure required as per Accounting Standard-19 issued by The, institute of Chartered Accountants of India with regard to the above is as under-

(a) Payment under Lease/Leave and License for period:

1. Not later than 1 year Rs. 6.51 lac

2. Later than 1 year, but not later than 5 years Rs.4.65 lac.

(b) There are no transactions in the nature of Sub Lease.

(c) Payments recognised in the profit and Loss Account for the year ended 31st March, 2010isRs.51.46lac.

Liability in respect of unavailed pnviledge leave was hitherto valued at the salary rates prevailing on the balance sheet date. During the year, the company has valued the compensated absences, specified in AS 15 (Revised) on acturial basis. Further para 132 of AS 15 (Revised 2005) does not require any specific disclosure except where the expense resulting from compensated absences is of such size, nature of incidence that its disclosure is relevant under other accounting standards. In the opinion of the management, the expense resulting from compensated absences is not significant and hence no disclosures are prepared under various paragraphs of AS 15 (Revised 2005).

8. All Credit Facilities from Banks are secured by way of hypothecation of the Companys entire stocks of raw materials, semi-finished and finished goods, consumable stores and spares and such other movable including book-debts, bills whether documentary or clean, outstanding monies, receivables, both present & future and Plant & Machinery on pari passu basis and First charge by way of equitable mortgage of property situated at Jajru Road. 25th Mile Stone, Delhi Mathura Road, Ballabhgarh, Haryana on pari passu basis.

9. Balance of some of Sundry Debtors, Sundry Creditors and Loans & Advances are subject to confirmation and reconciliation by the parties and adjustment, if any, required on reconciliation, will be done in the year in which the same is reconciled. Further, Management does not expect any material difference in the financial Statements for the year.

10. The Cash Flow Statement has been prepared under the "Indirect Method" set out in Accounting Standard (AS-3) issued by The Institute of Chartered Accountants of India.

11. Previous years figures have been regrouped to make them comparable with current year figures wherever necessary.

12. Schedules 1 to 16 form integral part of the accounts and are duly authenticated.

 
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