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Notes to Accounts of Agro Dutch Industries Ltd.

Mar 31, 2014

I)Accounting policies not specifically referred to above are consistent with Generally Accepted Accounting Policies (GAAP)

Ib) Custom duty saved on Machinery imported against advance license scheme as on 31st March, 2014 and 31st March, 2013 is 2136.31 lacs and Rs 2136.31 lacs respectively. The management is of the view that the necessary Compliance will be adhere to.

II) Company has provided Rs. NIL ( last year Rs 2.48 lacs ) as liability on account of Anti Dumping Duty for the period 1-4-2013 to 31-3-2014 on the basis of last assessment. Difference, if any, will be accounted for at the time of final assessment for the period.

III) Under the provisions of Accounting Standard-18 Issued by the Institute of Chartered Accounts of India following information is disclosed: Particulars of Transactions

V) Deferred Tax Liability

Accounting for Taxes on Income - Disclosure as per AS 22: Major components of deferred tax assets and liabilities on account of timing differences are as follows:

The company follows Accounting Standard -22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India. Since there is no convincing evidence which demonstrates virtual certainty of realization of deferred tax assets, the company has prudently decided not to recognise deferred tax asset.

VII) SEGMENT INFORMATION

Company deals in one product i.e. export of canned mushroom. As such Board is of the opinion that no disclosure is required as per accounting standard 17.

Note : Write off on account of Apeda Transport Subsidy is due to rejection of claim by the

respective agencies. As regards expense on Freight and others on recall refer point XV below.

IX) Valuation of Work-in-Process & Finished Goods being a technical matter has been taken as certified by the Management and Cost Accountant.

X) As per notification of APEDA, the Company is entitled to transport Subsidy in respect of freight on Exports made during the year. The estimated value of Subsidy works out to NIL ( previous year Rs 17.30 lacs ) for the year 2013-14. The same amount has been considered in the Profit & Loss account against the Ocean Freight.

Company is also entitled for C.S.T reimbursement and Duty drawback on H.S.D under the EXIM Policy. During the year company paid Rs. 2.71 Lacs (Previous year Rs. 33.35 Lacs) as C.S.T. The amount has been taken under the head advance since the whole amount is reimbursable under the above policy. Duty drawback for NIL (previous year Rs 4.24 Lacs) on Diesel has been adjusted against consumption of diesel.

XI) On the basis of information available with the Company, regarding the status of suppliers as defined under the "Micro Small and Medium Enterprises Development Act 2006", total dues to suppliers as at 31st March 2014 amounts to Rs. 74,09,527/- (Previous Year : Rs. 78,93,830/-)

Further as per information available the company has not provided any interest on overdues amount during the period/close of the year as required under the Act.

XII) In the opinion of the Board Current Assets, Loans & Advances are approximately of the value stated which if realized in the ordinary course of business except stated otherwise. The provisions for all the known liability are adequate.

XIII) Comissioning of Can making plant at chennai is getting delayed due to final integration of the unit, which is pending due to liquidity problem being faced by the Company.

XIV) The Company is continously incurring substantial losses and its net worth has been fully eroded. The entire Loan accounts of the Company has become Non Performing/recalled/doubtfull and has been accordingly been shown under the head ''Current Liabilities'' .

Subsequent upon erosion of entire net worth, The Company filed fresh reference to the BIFR. The same has been registered vide case no. 75/2013

The Secured Consortium Lenders have issued notice under section-13(2) of SARFESI ACT,2002. The Company has suitably replied the same.

The Secured Lenders have decided to sell surplus and non core assets through Asset Sale Committee & UBI Consortium.

The company expect the liquidation of the Secured Term Debts by way of disposing the said non core and surplus assets. Further the activity of the company shall continue with the remaining assets as going concern.

Taking into account the above facts, the financial statements have been prepared on the basis that the company is a going concern and that no adjustments are required to the carrying value of assets and liabilities.

XV) The Operations of the Company continued to be adversely affected due to presence of some traces of Carbendazim in Shipments of Canned Mushrooms to US. The said development has resulted into reduced level of production. The freight forwarder agency has served a legal notice of Rs. 3.75 Crores, which is towards inward and outward freight and also includes an amount of Rs. 1.55 Crores towards detention and demurrage charges. The Company has not made any provision towards that detention and demurrage as the said claim is not tenable as per the legal opinion obtained by the company.

XVI) As per the financial restructuring scheme approved by the CDR - EG, there is no provision relating to penal interest and other charges. As such the company has not made any provision on that account .More over since the company is approaching BIFR , it is hopeful of suitable package which will result in reduction

XVII) DISCLOUSERS IN ACCORDANCE WITH REVISED AS-15 ON "EMPLOYEEES BENEFITS"

a) Defined Contribution Plan:-

The Company has recognized the following amounts in the Profit and Loss Account for the Year:

b) Defined Benefit Plans:-

The following figures are as per actuarial valuation, as at the Balance Sheet Date, carried out by an independent actuary.

i) A reconciliation of Opening and Closing Balances of the Present Value of the Defined Benefit Plan (DBO).

iii) Amount recognized in Balance Sheet including a Reconciliation of the Present Value of the Defined obligation in (a) and Fair value of the Plan assets in (b) to the assets and liabilities recognized in the balance sheet.

vi) The overall expected rate of return on assets is based on the expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligations.

vii) Following are the Principal Actuarial Assumptions used as at the Balance Sheet Date:

The above said Rupee Term Loan/FITL/WCTL/Corporate term loans are secured by way of pari passu first charge on the Fixed assets of the company and Pari passu second charge on current assets of the company , present and future.

The above said Term Loan/WCTL/FITL ( except Foreign Currency Loans ) are further secured by way personal guarantee of two directors of the company ( Out of which one has resigned) as well as pledge of their 100% holding ( present and future ) in the company. The said facilities are further secured by the corporate guarantee of M/S Vishwa Calibre Builders Pvt. Ltd. and M/S Penta Homes Pvt. Ltd . The later''s guarantee being limited to the extent of face value of 19,00,000 equity shares in Agro Dutch Industries Limited.

The Secured Lenders (UBI Consortium) have issued a notice under section 13(2) of SARFESI ACT,2002 for repayment of Debt, Which has been Suitably replied by the company.

The above said Working Capital Demand loan are secured by way of pari passu first charge on the Fixed assets of the company and Pari passu second charge on current assets of the company, present and future.

Working capital facilities are secured by way of pari passu first charge on the current assets of the company and pari passu second charge on the fixed asets of the company , present and future.

The above said Working Capital facilities & Working Capital Demand Loans are further secured by way personal guarantee of two directors of the company as well as pledge of their 100% holding ( present and future ) in the company. The said facilities are further secured by the corporate guarantee of M/S Vishwa Calibre Builders Pvt. Ltd. And M/S Penta Homes Pvt. Ltd . The later''s guarantee being limited to the extent of face value of 19,00,000 equity shares in Agro Dutch Industries Limited.

Note All term loan liabilites have become Non Performing Assets/recalled/doubtful and as such have been shown under the head Current Maturities of lon g term Debts.


Mar 31, 2013

I) SEGMENT INFORMATION

Company deals in one product i.e. export of canned mushroom. As such Board is of the opinion that no disclosure is required as per accounting standard 17.

ii) Valuation of Work-in-Process & Finished Goods being a technical matter has been taken as certified by the Management and Cost Accountant.

iii) As per notification of APEDA, the Company is entitled to transport Subsidy in respect of freight on Exports made during the year. The estimated value of Subsidy works out to Rs. 17.30 Lacs ( previous year Rs 172.06 lacs ) for the year 2012-13. The same amount has been considered in the Profit & Loss account against the Ocean Freight.

Company is also entitled for C.S.T reimbursement and Duty drawback on H.S.D under the EXIM Policy. During the year company paid Rs. 33.35 Lacs (Previous year Rs. 56.98 Lacs) as C.S.T. The amount has been taken under the head advance since the whole amount is reimbursable under the above policy. Duty drawback for Rs.4.24 Lacs (previous year Rs 25.45 Lacs) on Diesel has been adjusted against consumption of diesel.

iv) On the basis of information available with the Company, regarding the status of suppliers as defined under the "Micro Small and Medium Enterprises Development Act 2006", total dues to suppliers as at 31st March 2013 amounts to Rs. 78,93,830/- (Previous Year : Rs. 1,69,13,471/-) Further as per information available there were no over dues during the period/close of the year and therefore the question of provision/payment of related disclosure under the said Act, does not arise.

v) In the opinion of the Board Current Assets, Loans & Advances are approximately of the value stated which if realized in the ordinary course of business except stated otherwise. The provisions for all the known liability are adequate.

vi) Comissioning of Can making plant at chennai is getting delayed due to final integration of the unit, which is pending due to liquidity problem being faced by the Company.

vii) The Company is continously incurring substantial losses and its net worth has been fully eroded. The entire Loan accounts of the Company has become Non-Performing/recalled/doubtfull and has been accordingly been shown under the head ''Current Liabilities''.

A reference on the basis of Audited Blance Sheet of 31/03/2011 ,was made to the Board for Industrial and Financial Reconstruction (BIFR), which was dismissed by the Board on ground of basis of calculation of Net worth,considering auditors qualification.The Company filed an appeal against the order of the BIFR, which has been admitted by Appellate Authority for Industrial & Financial Reconstruction (AAIFR), New Delhi vide its order dated 22.08.2012. The company is ready with suitable rehabilitation scheme to be put before BIFR , which will help it in turnaround operations. As per the Balance Sheet as on 31st March 2013, the net worth of the company continues to be eroded. The Appeal in AAIFR is under Consideration .Pending the Appeal, Further the Company

Propose to file a fresh reference with BIFR.The Company shall be filling fresh reference as per the Audited Balance sheet as on 31.03.2013.

The Company has approched its Consortium and Secured Lenders to repay the Debts by Selling its Non-Core and Surplus assets. The Said Proposal has been Principally agreed and under active consideration for final approval from the respective Competent authorities of the Lenders.

The company expect to repay the Secured Term Debts by way of disposing the said non core and surplus assets.Further the Operation shall continue with the remaninig assets as going concern

Taking into account the above facts, the financial statements have been prepared on the basis that the company is a going concern and that no adjustments are required to the carrying value of assets and liabilities.

viii) The Operations of the Company have been adversely affected due to presence of some traces of Carbendazim in Shipments of Canned Mushrooms to US. The said traces have been found during testing by USFDA. The Company has recalled those containers back to India. The said development has resulted into reduced level of production.The freight forwarder agency has served a legal notice of Rs. 3.75 cores, which is towards inward and outward freight and also includes an amount of Rs. 1.55 Crores towards detention and demurrage charges. The Company has not made any provision towards that detention and demurrage as the said claim is not tenable as per the legal opinion obtained by the company.

ix) The Company has not made any provision towards the penal interest and other charges as levied by the Lenders. In the opinion of the Company, the said charges are not payable since there is no provision for the said charges in the loan documents of the company.


Mar 31, 2011

La. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF:-

Particulars (Rs. In Lacs)

Current Year Previous Year

Letter of credit established by the 1085.72 655.98 Company

Bills discounted with Company's 1879.24 1202.02 Bankers

Collateral Security Bond with US 128.76 128.76 Customs and Protection USA

Surety Bond to the Excise Department 5000.00 5000.00

Estimated amount of contracts remaining - 15.00 to be executed

on capital account and not provided

Litigation Pending against company 107.53 112.93 and not provided for

Guarantee given to AXIS Bank (Against 600.00 600.00 facilities to farmers/JLGs)

Preference Dividend on 6% OCCRPS for 552.86 277.09 2009-10 & 2010-11 including Dividend Tax thereon.

lb. Custom duty saved on Machinery imported against advance license scheme as on 31st March, 2011 and 31st March, 2010 is Rs. 2136.31 lacs and 2105.52 lacs respectively. The management is of the view that considering the future export prospects there is certainty that pending export obligation under advance licenses will be fulfilled before expiry of respective licenses.

2. Company has provided Rs. 40.24 lacs towards liability of Anti Dumping Duty for the period 1-2-2010 to 31-1-2011. As there will be no review for this period, as such liability has been provided on the basis of last assessment.

3. Under the provisions of Accounting Standard-18 Issued by the Institute of Chartered Accounts of India following information is disclosed:

4. Segment Information

Company deals in one product i.e. export of canned mushroom. As such Board is of the opinion that no disclosure is required as per Accounting standard 17.

5. Valuation of Work-in-Process & Finished Goods being a technical matter has been taken as certified by the Management and cost Accountant

6. As per notification of APEDA, the Company is entitled to transport Subsidy in respect of freight on Exports made during the year. The estimated value of Subsidy works out to Rs. 94.30 Lacs for 2010-11. The same amount has been considered in the Profit & Loss account against the Ocean Freight.

Company is entitled for C.S.T reimbursement and Duty drawback on H.S.D under the EXIM Policy. During the year company paid Rs 40.66 Lacs (Previous year 26.76 Lacs) as C.S.T. The amount has been taken under the head advance since the whole amount is reimbursable under the above policy. Duty drawback for Rs 29.54 Lacs (Previous year 24.10 Lacs) on Diesel has been adjusted against consumption of diesel

7. On the basis of information available with the Company, regarding the status of suppliers as defined under the "Micro Small and Medium Enterprises Development Act 2006", total dues to suppliers as at 31st March 2011 amounts to Rs.1,19,64,619/- (Previous Year : Rs. 99,07,567/-)

Further as per information available there were no overdues during the period/close of the year and therefore the question of provision/payment of related disclosure under the said Act, does not arise.

8. In the opinion of the Board Current Assets, Loans & Advances are approximately of the value stated if realized in the ordinary course of business except stated otherwise. The provisions for all the known liability are adequate.

9. Company has till date spent a sum of Rs. 137.24 lacs on easy open ends can unit being coming up in Chennai. The project is expected to be operational in near future.

10. The Company has incurred substantial losses and its net worth after considering audit qualification has been eroded.

The Company has also received recall notice from Kotak Mahindra Bank, Barclays Bank, M & T and DEG. Barclays bank has filed an application with DRT for recovery of dues. However having regard to the fact that company shall be making necessary reference to Hon'ble BIFR for suitable rehabilitation scheme which will help it in the turnaround operations, the financial statements have been prepared on the basis that the Com pay is a going concern and that no adjustments are required to the carrying value of assets and liabilities.

11. Sundry debtors include an amount of Rs. 1480.24 lacs due from a foreign buyer, which has been disputed by the said buyer. The company is making its efforts for the recovery of said amount and, therefore, no provision for the same has been made in the books.

12. Previous year figures have been regrouped or rearranged wherever necessary.

13. Schedule 1 to 19 form an integral part of Balance Sheet and Profit & Loss A/c.


Mar 31, 2010

1 a. CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF:-

Particulars (Rs. In Lacs) Current Year Previous Year

Letter of credit established by the Company 655.98 696.71

Bills discounted with Companys Bankers 1202.02 3515.62

Collateral Security Bond with US Customs and Protection USA 128.76 725.00

Surety Bond to the Excise Department 5000.00 5000.00

Estimated amount of contracts remaining to be executed 15.00 15.00

on capital account and not provided

Litigation Pending against company and not provided for 112.93 191.31

Us Anti Dumping Duty - 772.96

Guarantee given to AXIS Bank (Against facilities to farmers/JLGs) 600.00 600.00

Preference Dividend on 6% OCCRPS for 2009-10 277.09 - including Dividend Tax thereon.



1b. Company duty saved on Machinery imported for CAN making unit against advance license scheme as on 31st March, 2010 and 31st March, 2009 is Rs. 2105.52 lacs and 2083.69 lacs respectively. The management is of the view that considering the future export prospects there is certainty that pending export obligation under advance licenses will be fulfilled before expirty of repective licenses.

2. Company has provided Rs. 27.08 lacs towards liability of Anti Dumping Duty for the period 1-2-2009 to 31-1-2010. As there will be no review for this period, as such liability has been provided on the basis of last assessment.

k) Remuneration paid/payable to managing director and executive director for 2009-10 amounting to Rs. 46.80 lacs and Rs. 39.00 lacs respectiverly, approval of the central Govt, is pending.

3. SEGMENT INFORMATION

Company deals in one product i.e. export of canned mushroom. As such Boatd is of the opinion that no disclosure is required as per Accounting standard 17.

d) Extra ordinary items represents additional anti dumping duty of Rs.772.97, which on the legal advice of the Companys attorney in USA was not provided during 2008-09, though the demand for the same was raised last year. Since confirmation has been received from the attorney during the year and as such the same has been charged to Profit and Loss account in current year.

4 Pending necessary approval company has adjusted Rs. 1338,02,600 on account US customs duty paid/pay.able by customer on behalf of company against dues from that party on account of exports made. Had the adjustment been not made debtors would have been higher by Rs. 1338,02,600 with corresponding increase in expenses payable.

5. The Company received Rs 2000.00 lacs against conversion of Preferential Allotment of Warrants during 2009-10. The amount raised through Preferential Allotment during the year has been utilized on over all basis as set out below:

Particulars Rs. In Lacs

Working Capital 2000.00



6 Valuation of Work-in-Process & Finished Goods being a technical matter has been taken as certified by the Management and cost Accountant

7. As per notification of APEDA, the Company is entitled to transport Subsidy in respect of freight on Exports made during the year. The estimated value of Subsidy works out to Rs. 97.98 Lacs for 2009-10. The same amount has been considered in the Profit & Loss account against the Ocean Freight.

Company is entitled for C.S.T reimbursement and Duty drawback on H.S.D under the EXIM Policy. During the year company paid Rs 26.76 Lacs (Previous year 55.23 Lacs) as C.S.T. The amount has been taken under the head advance since the whole amount is reimbursable under the above policy. Duty drawback for Rs 24.10 Lacs (Previous year 3.23 Lacs) on Diesel has been adjusted against consumption of diesel

8. On the basis of information available with the Company, regarding the status of suppliers as defined under the "Micro Small and Medium Enterprises Development Act 2006", total dues to suppliers as at 31st March 2010 amounts to Rs.99,07,567/- (Previous Year : Rs. 56,64,882/-)

Further as per information available there were no overdues during the period/close of the year and therefore the question of provision/payment of related disclosure under the said Act, does not arise.

9. Certain Creditors, Debtors and Advances/Capital advances are subject to reconciliation.

10. In the opinion of the management, the Current Assets, Loans & Advances are approximately of the value which may be realized in the ordinary course of business except stated otherwise. The provisions for all the known liability are adequate.

11. During the year companys proposal for corporate restructuring was approved. The scheme inter alia includes restructuring of repayment schedule interest funding as FITL, concession of interest rate, conversion of irregular working capital into 39,64,110 6% Optional cumulative convertible preference shares of Rs. 100/- each. Necessary transactions have been carried out in the current financial year as per terms and conditions of Master Restructuring Agreement.

12. Previous year figures have been regrouped or rearranged wherever necessary.

13. Schedule 1 to 18 form an integral part of Balance Sheet and Profit & Loss A/c,

C. DISCLOUSERS IN ACCORDANCE WITH REVISED AS-15 ON "EMPLOYEEES BENEFITS"

a) Defined Contribution Plan:-

b) Defined Benefit Plans:-

The following figures are as per acturial valuation, as at the Balance Sheet Date, carried out by an independent actuary.

vi) The overall expected rate of return on assets is based on the expectation of the average long term rate of return expected on investments of the fund during the estimated term of the obligations.





 
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