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Notes to Accounts of Andhra Cements Ltd.

Jun 30, 2015

1. Terms/Rights attached to Equity Shares

The Company has only one class of equity shares having a face value of Rs, 10 per Share and each holder of equity shares is entitled to one vote per share.

In the event of liquidation, the holders of equity shares will be entitled to receive the remaining assets of the company, after distribution of all preferential amounts, in proportion to their share holdings.

Dividend - Each Share is entitled to dividend, if declared. The dividend if any, proposed by board of Directors subject to the approval of shareholders ensuring in Annual General meeting, except in case of interim dividend.

Note 2.

Term Loan are secured by first charge by way of mortgage, on immovable properties and hypothecation of all movable properties, machinery, machinery spares, tools, furniture fixture & accessories present and future, and second charge on current assets including inventories, stores and spares, book debts, operating cash fow receivables etc., Further secured by first charge on Intangible Assets and other reserve relating to the project, and pledge of 47.97% Shares of Promoter Holding (Minimum of 33% of Total Company Paid up Capital).

Note 3.

Sub Debt are secured by residual charge by way of mortgage, on immovable properties and hypothecation of all movable properties, machinery, machinery spares, tools, furniture fixture & accessories present and future, and residual charge on current assets including inventories, stores and spares, book debts, operating cash fow receivables etc., Further secured by residual charge on Intangible Assets and other reserve relating to the project, and pledge of 47.97% Shares of Promoter Holding (Minimum of 33% of Total Company Paid up Capital)

Note 4.

Deferred Interest of 6.5% on Sub-debt of IDFC & HDFC has been shown under the Head "Other Noncurrent Liabilities" of Rs, 729.31 Lacs (Rs, 361.40 Lacs) & Rs, 707.32 Lacs (Rs, .302.23 Lacs) respectively.

5. Unpaid matured Debentures are secured to the extent of Rs, 193.19 lakhs (Rs, 193.65 lakhs) against deposit in a separate bank account with lien thereon in favour of Debenture Trustees. As per Modifed Scheme 2008 (MS-08), Principal amount is payable as and when claimed by the Debenture Holders after adjusting the repayments made earlier, if any.

6. The redeemable Cumulative First Preference Shares remain unclaimed aggregating to Rs, 1.92 lakhs (Rs, 1.92 lacs). The payment against these shares are being made as and when claimed by the holders. The company has been legally advised that in the absence of Profits up to the date of redemption till June 2015

7. Pursuant to the Companies Act, 2013, the Company has, during the period, revised depreciation rates on certain fixed assists as per the useful life specified in Scheducle II of the Act or as re-assessed by the Company. Due to this, based on transitional Provision as per Note No.7 (b) of the Schedule II of the Act, an amount of Rs, 228.53 lacson account of assets whose useful life had already been exhausted as on 1st April, 2014, had been adjusted in the "General Reserve".

8. The Company during the course of physical verification of fixed assets conducted during the period, found certain discarded/scrapped/missing assets amounting to Rs, 728.07 lacs being gross value and accumulated depreciation on such assets amounting to Rs, 692.78 lacs, have been shown under deductions during the period.

9. Gross Block includes increase in value of Land, Buildings, Plant and Machinery, Electrical Installations, and Railway Siding consequent to revaluation by an approved valuer as on 31-03-1998 at the then replacement values aggregating to Rs, 208.34 Crores. Depreciation for the period amounting to Rs, 203.17 lacs (Rs, 313.27 lacs) on the revalued depreciable assets has been withdrawn from the Asset Revaluation Reserve and reduced from the depreciation charged to the Profit and Loss Account. Depreciation on revalued assets is also revised pursuant to the Companies Act, 2013 as stated in point no.2 above, there by depreciation of Rs, 176.08 lacs, whose useful life is already exausted on 1st April, 2014 have been adjusted to revaluation reserve. Further, Rs, 429.64 lacs and Rs, 368 lacs being the Gross value and accumulated depreciation respectively on the assets scrapped/discarded found during the course of Physical verification have also been adjusted to revaluation reserve and reduced from Profit & Loss Account.

Aggregate amount of the un-quoted Investment is Rs, 0.42 lacs Aggregate provision for diminution in value of Investments is Rs, 0.25 lacs

Note 10.

The disclosure as required by Accounting Standard 15(Employee Benefit) relating to employee benefits recognized are set-out below:

The employee Gratuity Scheme are defined plans. The present value of obligation are determined based on actuarial valuation using projected Unit Credit method, which recognized each period of Services as giving raise to additional unit of employee benefit entitlement and measures each unit separately to build-up the fnal obligation. The obligation for compensated absence is recognized in the same manner as gratuity.

Disclosure for defined plan based on actuarial report as at June 30, 2015 is as follows:

Note 11.

The employee benefits liability is not funded. Accordingly disclosures related to return on planned assets and fair value thereof is not ascertainable.

Note 12.

Assumptions relating to future salary increases, attrition, interest rate for discount have been considered based on relevant economic factors such as inflation, market growth Obligation is expected to be settled & other factors applicable to the period over which the obligation is expected to be settled.

* Sales stated above are inclusive of transferred to Capital Work-in-Progress up to November 30, 2014, under Trial Run production.

NOTE 13.

Estimated amount of contracts to be executed on capital account (net of advances) Rs, 985 lakhs (Previous Year Rs, 5199.90 lakhs)

(iv) The Ministry of Textiles, vide its Order dated June 30th 1997 and July 1st 1999, has deleted the Cement from the list of commodities to be packed in Jute bags, under the Jute Packaging Materials (Compulsory Use of Packing Materials), Act, 1987. Inview of this, the company does not expect any liability for non-dispatch of cement in jute bags in respect of earlier years.

(v) Excise authority, although accepted payment of Rs, 629 lacs under installment scheme in terms of BIFR Order (MS-08), has subsequently filed an appeal in AAIFR against the said order in respect of reliefs for interest etc., granted to the Company. The Company challenged the demand of interest before Hon'ble Delhi High Court. The Delhi High Court disposed the appeal by remanding back to the Commissioner of Central Excise. The Department has issued a Show Cause Notice (SCN) on 19th June 2015 demanding Rs, 984.70 Lakhs towards interest on the installments. The reply for the SCN is yet to be submitted by the Company. However, The Company is confdent of waiver of interest in terms of Hon'ble BIFR directions

(vi) The Company has export obligation in connection with import of machineries under Export Promotion Capital Goods Scheme (EPCG). In the event of non-fulfillment of the export obligation up to FY 2016-17, the company may be held liable for differential custom duty of Rs, 838.16 Lakhs (approximately) and interest thereon.

(vii) During the previous period, employee benefit expenses includes arrears of salaries and wages and other expenses of Rs, 1,150 Lakhs in terms of Memorandum of Settlement u/s 18(1) of the Industrial dispute Act,1947, entered into with the Labour Unions on 6th March, 2012. However, some of the workers have fled an application with Central Government Industrial Tribunal cum Labour Court under section 33(c) (2) of Industrial Dispute Act, 1947 in year 2013-14 demanding payment of Rs, 59.34 Lakhs which had been waived off as per the above settlement with the registered labour union. The case is under trail with Central Government Industrial Tribunal cum Labour Court under section 33(c)(2) of Industrial Dispute Act, 1947.

(viii) FSA (fuel surcharge Adjustment) of Rs, 4018 lakhs levied by APSPDCL in 2009-10 which is under disputed and challenged by all cement companies in the Hon'ble Supreme Court for same management is confidence that decision in favour of Company hence not consider under contingent liability.

NOTE 14. -

Remuneration amounting to Rs, 45.26 Lakhs to ex whole time Directors and ex-Managing Director Payable for the earlier years are pending approval of Central Government.

NOTE 15.

(i) The company has commenced commercial production effective from 1st December 2014. Pre-operative and incidental expenditure including borrowing costs capitalized till 30th November 2014. Presently erection of 30 MW Captive Power Plant and certain modifications to the Plant is under progress

(ii) As per the Accounting Standard 16 "Borrowing Cost", an amount of Rs, 4452.55 lacs towards interest related to the period during which construction activities remained suspended has been charged to the Statement of Profit and Loss as exceptional item during the year.

NOTE 16.

To the extent information available with the Company, there are no out standings as at the end of the year to the parties registered under the Micro, Small & Medium Enterprises Development Act, 2006. The Company has also not received any demands/notices from the forms stating their coverage under the said Act.

NOTE 17.

Some of the records of the company like agreements with suppliers/agents, statements of Bank Accounts including those at some of the branches/depots for the period prior to June 1994, have still not been restored by the erstwhile promoters/ management. The matter being pending since considerable long time, no material adjustment, in this respect, is likely to arise.

The company has recognized deferred tax asset on Unabsorbed Depreciation up to 31 March 2014to the extent of the corresponding deferred tax liability on the difference between the book balance and the written down value of fixed assets as per the Income Tax Act 1961.

NOTE 18.

Some of the Sundry Debtors, Deposits Retention Money, Sundry Creditors and Advances are subject to confirmations. The management does not expect any material adjustment on account of such confirmation.

NOTE 19.

(a) The Hon'ble BIFR has discharged the Company from the purview of Sick Industrial Companies (Special Provisions) Act, 1985 vide its Order dated 22nd January 2010. In terms of the said Order, the unimplemented provisions of MS-08 (Modified Rehabilitation Scheme sanctioned by BIFR vide its Order dated 21st July 2008) would be implemented by the concerned agencies.

b) In terms of MS-08, 13.5% Secured Redeemable Debentures are required to be settled by payment of principal amount only and interest stand waived. The Company has deposited an amount equivalent to the principal amount of these debentures marking a lien in favour of the Debenture Trustees. The unclaimed debentures at year end are shown under the head "Other Current Liabilities".

c) In terms of the said Scheme, the fixed deposit holders are to accept outstanding principal amount in four annual installments commencing from financial year 2007-08 onwards, on interest-free basis. The unclaimed fixed deposits at year end are shown under the head "Other Current Liabilities".

20. (a) The Company does not have any outstanding derivative contract as on June 30, 2015.

(b) Un-hedged foreign currency exposures of the company as on June 30, 2015 are as follows

NOTE 21.

As the Company is engaged in the manufacture of cement within India only, it operates in single primary business segment and single secondary geographical segment and therefore disclosure requirement of Accounting Standard 17 on Segment Reporting are not applicable to it.

NOTE 22.

In accordance with "Accounting Standard 19-Accounting for Lease", the company has taken Asset on Operating Lease, the total of Future minimum lease payment under non-cancellable operating lease for each of the following periods:

- Not later than one Year Rs, 56.46 Lacs

- Later than one year and not later than five years Rs, 112.95 Lacs Lease payments recognized in the statement of Profit and Loss for the year is Rs, 70.57 Lacs.

Leasing Arrangement clause

a) Lease term is for 60 Months basis, One month moratorium, and 59 rentals.

b) At the end of the lease period following options would be offered to us:

1. Terminate the lease and return the equipment.

2. Renew the Lease for secondary period.

3. Purchase the equipment at Fair Market value.

NOTE 23.

Related Parties and transactions with them, as identified by the management in accordance with the Accounting Standard 18, as notified by the Companies Accounting Standard Rules, 2006, are as follows:

1. Key Managerial Personnel Shri Manoj Gaur, Chairman Up to 08.08.2014

Shri K N Bhandari, Chairman from11.08.2014

Shri S K Mandal, Managing Director from 11.08.2014

2. Ultimate Holding Company M/s. Jaypee Infra Ventures Pvt. Ltd., being Holding Company of Jaypee

Development Corporation Limited

Holding Company Jaypee Development Corporation Limited

3. Associate/ Co-subsidiary Company Jaypee Development Corporation Limited

Jaiprakash Associates Limited

4. Enterprise over which, companies stated Jaypee Cement Corporation Limited at S. No. (2) and (3) above have significant Himalayaputra Aviation Limited influence. JIL Information Technology Limited

BhilaiJaypee Cement Limited BokaroJaypee Cements Limited

NOTE 24.

The Board of Directors of the Company vide resolution dated February 11, 2015, approved extension of financial year 2014-15 of the Company by a period of 3 months i.e., up to June 30, 2015. Accordingly, the annual accounts of the Company for the current financial year 2014-15 are prepared for a period of 15 months from April 01, 2014 to June 30, 2015.

NOTE 25.

The Company has commenced Commercial Production with effect from December 1, 2014.

NOTE 26.

All amounts in the financial statements are presented in Lakhs (INR) except per share data and as otherwise stated. Figures in brackets represent corresponding previous year figures. Previous year's figures have been regrouped /rearranged wherever considered necessary.


Mar 31, 2014

1. Terms/Rights attached to Equity Shares

The Company has only one class of equity shares having a face value of Rs. 10 per Share and each holder of equity shares is entitled to one vote per share. In the event of liquidation, the holders of equity shares will be entitled to receive the remaining assets of the company, after distribution of all preferential amounts, in proportion to their share holdings.

2. Forfeited shares (amount originally paid up) is Rs. 0.39 Lacs/-

3. Note

Investment subsidy in respect of Visakha Unit received during the accounting year ended March 31, 1981.

4. Note

Term Loan are secured by first charge by way of mortage, on immovable properties and hypothecation of all movable properties, machinery, machinery spares, tools, furniture fixture & accessories present and future, and second charge on current assets including inventories, stores and spares, book debts, operating cash flow receivables etc., Further secured by first charge on Intangible Assets and other reserve relating to the project, and pledge of 55% Shares of Promoter Holding (Minimum of 33% of Total Company Paid up Capital).

5. Note

Sub Debt are secured by residual charge by way of mortage, on immovable properties and hypothecation of all movable properties, machinery, machinery spares, tools, furniture fixture & accessories present and future,and residual charge on current assets including inventories, stores and spares, book debts, operating cash flow receivables etc., Further secured by residual charge on Intangible Assets and other reserve relating to the project, and pledge of 55% Shares of Promoter Holding (Minimum of 33% of Total Company Paid up Capital)

6. Note

Deferred Interest of 6.5% on Sub-debt of IDFC & HDFC has been shown under the Head "Other Non current Liabilities" of Rs. 361.40 Lacs (Rs. 87.38 Lacs) & Rs. 302.23 Lacs (Rs. 0.80 Lacs) respectively.

7. Note

Working Capital Loans are secured by first pari passu charge by way of hypothecation of the current assets and second charge on fixed assets of the company. These loans are further secured by Personal guarantee of Chairman, Mr. Manoj Gaur.

8. Unpaid matured Debentures are secured to the extent of Rs. 193.65 Lacs (Rs. 193.98 Lacs) against deposit in a separate bank account with lien thereon in favour of Debenture Trustees. As per Modified Scheme 2008 (MS-08), Principal amount is payable as and when claimed by the Debenture Holders after adjusting the repayments made earlier, if any.

9. The redeemable Cumulative First Preference Shares remain unclaimed aggregating to Rs. 1.92 Lacs (Rs. 1.92 Lacs). The payment against these shares are being made as and when claimed by the holders. The company has been legally advised that in the absence of profits upto the date of redemption (i.e., June 15, 1993), it has no obligation to pay any dividend on these Shares.

NOTE:

1. Transport Vehicles includes 6 nos.of cars which are not in possession of the company, and the ownership of these cars is not verifiable.

2. Gross Block includes increase in value of Land, Buildings, Plant and Machinery, Electrical Installations, and Railway Siding consequent to revaluation by an approved valuer as on 31-03-1998 at the then replacement values aggregating to Rs. 208.34 Crores. Depreciation for the period amountng to Rs. 313.27 Lacs (Rs. 624.83 Lacs) on the revalued depreciable assets has been withdrawn from the Asset Revaluation Reserve and reduced from the depreciation charged to the Profit and Loss Account.

Mode of valuation

a) Inventories are valued at cost or estimated net realizable value whichever is lower.

b) Cost for the purpose of Raw materials and stores and spares comprise of the respective purchase costs including non re- imbursable dutites and taxes.

c) Costs in respect of work-in progress and finished goods comprises of their respective costs including appropriate overheads and excise duty wherever applicable. Cost of inventories is determined on weighted average basis.

d) Machinery spares which can be used only in connection with an item of fixed assets and whose use is expected to be irregular are amortised over the life of the principal assets.

e) Scrap is valued at estimated net realisable value.

10. Note

The disclosure as required by Accounting Standard 15 relating to employee benefits recognised are set-out below:

The employee Gratuity Scheme are defined plans. The present value of obligation are determined based on actuarial valuation using projected Unit Credit method, which recognised each period of Services as giving riase to additional unit of employee benefit entitlement and measures each unit separately to build-up the final obligation. The obligation for compensated absence is recognised in the same manner as gratuity.

11. Note

The employee benefits liability is not funded. Accordingly disclosures related to return on planned assets and fair value thereof is not ascertainable.

12. Note

Assumptions relating to future salary increases, attrition, interest rate for discount have been considered based on relevant economic factors such as inflation, market growth Obligation is expected to be settled & other factors applicable to the period over which the obligation is expected to be settled.

* Sales and Raw Material consumption including Limestone has been transferred to Capital Work-in-Progress, under Trial Run production.

13. Note

Estimated amount of contracts to be executed on capital account (net of advances) Rs. 5199.90 Lacs (PY Rs. 8203.03 Lacs)

14. NOTE - CONTINGENT LIABILITIES

(i) Claim against the Company not acknowledged as debts including contractual obligations

(Rs. in Lacs)

Particulars As at As at March 31, 2014 March 31, 2013

Government Claims for Non-Statutory dues 195.30 195.30

Electricity Claims 116.83 116.83

Claims of Project Customers 952.00 952.00

Other Claims (Suppliers etc.) 75.37 106.78

(ii) Letter of Credit Outstanding:

(Rs. in Lacs)

Particulars As at As at March 31, 2014 March 31, 2013

Letter of Credit 1465.80 1173.43

(iii) Disputed demands under litigation:

(Rs. in Lacs)

Particulars As at As at Amount paid March 31, 2014 March 31, 2013 under protest, if any As At March 31, 2014

APGST / VAT 173.47 173.47 46.96

C S T 270.10 76.63 -

TNGST 67.29 67.29 1.71

OST 3.48 3.48 0.50

Central Excise 1123.15 1124.05 1.00

Service Tax 402.35 401.48 101.98

(iv) The Ministry of Textiles, vide its Order dated June 30, 1997 and July 1, 1999, has deleted the Cement from the list of commodities to be packed in Jute bags, under the Jute Packaging Materials (Compulsory Use of Packing Materials), Act, 1987. In view of this, the company does not expect any liability for non-dispatch of cement in jute bags in respect of earlier years.

(v) Excise authority, although accepted payment of their dues in installments in terms of BIFR Order (MS-08) has subsequently filed an appeal in AAIFR against the said order in respect of reliefs for interest etc., granted to the Company. The company has challenged and the same and the matter is pending before Hon''ble Delhi High Court, pending this, the amount is presently not ascertainable in this respect. There are no dues in respect of installments as on the date of the Balance Sheet. An amount of Rs. 73.11 Lacs is kept in abeyance pursuant to the order of Hon''ble BIFR.

(vi) The Company has export obligation in connection with import of machineries under Export Promotion Capital Goods Scheme (EPCG). In the event of non-fulfillment of the export obligation upto FY 2016-17, the company may be held liable for differential custom duty of Rs. 838.16 Lacs (approximately) and interest thereon.

(vii) During the previous period, employee benefit expenses includes arrears of salaries and wages and other expenses of Rs. 1,150 Lacs in terms of Memorandum of Settlement u/s 18(1) of the Industrial dispute Act, 1947, entered into with the Labour Unions on 6th March, 2012. However, some of the workers have filed an application with Central Government Industrial Tribunal cum Labour Court under section 33(c)(2) of Industrial Dispute Act, 1947 demanding payment of Rs. 59.34 Lacs which had been waived off as per settlement with the registered labour union.

15. NOTE

Remuneration amounting to Rs. 45.26 Lacs to ex whole time Directors and ex-Managing Director Payable for the earlier years are pending approval of Central Government.

16. NOTE

(i) Post acquisition by the present management, the plant layout, project costs, means of financing and schedule of implementation have been revised to execute balance upgradation and new installation to achieve phased increase in production capacity. Substantial progress has been made in respect of up gradation cum expansion project as per revised schedule. Accordingly, pre-operative incidental expenditure including borrowings costs continued to be capitalized.

(ii) The pre-operative expenses including interest on borrowings amounting to Rs. 7,598.50 Lacs (Rs. 4,941.61 Lacs) have been capitalized during the year under Capital Work in Progress. Necessary allocation with respect to above including adjustment, if any, as required in terms of Accounting Standard 16 on Borrowing Costs shall be carried out on ascertainment of amount thereof on completion of project.

(iii) Capital Work in Progress does not include Rs. 783.20 Lacs (Rs. 802.90 Lacs) in respect of claims made/ bills raised towards cost of civil and other services and supplies pending verification and negotiation and shall be accounted for on finalization of amount payable with respective parties. Further, Capital Advances (Project) includes Rs. 958.59 Lacs (Rs. 958.59 Lacs) given for various Project supplies and related services, etc, which even though are outstanding for long period, steps for recovery since been taken has been considered good and recoverable. Adjustment with respect to the above, if any, will be given effect to on final settlement with the parties. The management, however, does not expect any material adjustment on account of such verification/negotiation/settlement with the parties.

17. NOTE

To the extent information were available with the Company, there are no outstanding as at the end of the year to the parties registered under the Micro, Small & Medium Enterprises Development Act, 2006.

18. NOTE

Some of the records of the company like agreements with suppliers/agents, statements of Bank Accounts including those at some of the branches/depots for the period prior to June 1994, have still not been restored by the erstwhile promoters/ management. The matter being pending since considerable long time, no material adjustment, in this respect, is likely to arise.

The company has recognized deferred tax asset on Unabsorbed Depreciation to the extent of the corresponding deferred tax liability on the difference between the book balance and the written down value of fixed assets as per the Income Tax Act 1961.

19. NOTE

The balances in Sundry Debtors, Deposits Retention Money, Sundry Creditors and Advances are subject to confirmations and adjustments, if any. Such adjustments, in the opinion of the management, are not likely to be material and will be carried out as and when ascertained.

20. NOTE

(a) The Hon''ble BIFR has discharged the Company from the purview of Sick Industrial Companies (Special Provisions) Act, 1985 vide its Order dated 22nd January 2010. In terms of the said Order, the unimplemented provisions of MS-08 (Modified Rehabilitation Scheme sanctioned by BIFR vide its Order dated 21st July 2008) would be implemented by the concerned agencies.

b) In terms of MS-08, 13.5% Secured Redeemable Debentures are required to be settled by payment of principal amount only and interest stand waived. The Company has deposited an amount equivalent to the principal amount of these debentures marking a lien in favour of the Debenture Trustees. The unclaimed debentures at year end are shown under the head "Other Current Liabilities".

c) In terms of the said Scheme, the fixed deposit holders are to accept outstanding principal amount in four annual installments commencing from financial year 2007-08 onwards, on interest-free basis. The unclaimed fixed deposits at year end are shown under the head "Other Current Liabilities".

21. NOTE

(a) The Company does not have any outstanding derivative contract as on March 31, 2014.

22. NOTE

As the Company is engaged in the manufacture of cement within India only, it operates in single primary business segment and single secondary geographical segment and therefore disclosure requirement of Accounting Standard 17 on Segment Reporting are not applicable to it.

23. NOTE

In accordance with "Accounting Standard 19-Accounting for Lease", the company has taken Asset on Operating Lease, the total of Future minimum lease payment under non cancellable operating lease for each of the following periods:

* Not later than one Year Rs. 56.46 Lacs

* Later than one year and not later than five years Rs. 183.49 Lacs

Lease payments recognized in the statement of Profit and loss for the year is Rs. 20.28 Lacs and thereby transferred to capital work in progress as the Plant is under Trial run and these assets are being used for the Production purpose.

Leasing Arrangement clause

a) Lease term is for 60 Months basis, One month moratorium, and 59 rentals.

b) At the end of the lease period following options would be offered to us:

1. Terminate the lease and return the equipment.

2. Renew the Lease for secondary period.

3. Purchase the equipment at Fair Market value.

23. NOTE

The Company has not made any loans or advances in the nature of loans whose particulars are required to be disclosed in terms of clause 32 of the listing agreement.

24. NOTE

All amounts in the financial statements are presented in Rupees in Lacs except per share data and as otherwise stated. Figures in brackets represent corresponding previous period figures in respect of Statement of Profit and Loss items and in respect of Balance Sheet items as on the Balance Sheet date of the previous period. Figures for the previous period have been regrouped /rearranged wherever considered necessary.


Mar 31, 2013

1.1 The disclosure as required by Accounting Standard 15 relating to employee benefits recognised are set out below :

The employee Gratuity Scheme are defined plans. The present value of obligation are determined based on actuarial valuation using projected Unit Credit method'' which recognised each period of services as giving riase to additional unit of employee benefit entitlement and measures each unit separately to build-up the final obligation. The obligation for compensated absence is recognised in the same manner as gratuity.

1. 1.1 The employee benefits liability is not funded. Accordingly disclosures related to return on planned assets and fair value thereof is not ascertainable.

1. 1.2 Assumptions relating to future salary increases'' attrition'' interest rate for discount have been considered based on relevant economic factors such as inflation'' market growth obligation is expected to be settled& other factors applicable to the period over which the obligation is expected to be settled.

2. Remuneration amounting to Rs.39.51 Lakhs to ex whole time Directors and ex-Managing Director Payable for the earlier years are pending approval of Central Government.

3. Some of the records of the company like agreements with suppliers/agents'' statements of Bank Accounts including those at some of the branches/depots for the period prior to June 1994'' have still not been restored by the erstwhile promoters/management. The matter being pending since considerable long time'' no material adjustment'' in this respect'' is likely to arise.

4. (i) Post acquisition by the present management'' the plant layout'' project costs'' means of financing and schedule of implementation have been revised to execute balance upgradation and new installation to achieve phased increase in production capacity. Substantial progress has been made in respect of up gradation cum expansion project as per revised schedule. Accordingly'' pre-operative incidental expenditure including borrowings costs continued to be capitalized.

(ii) The pre-operative expenses including interest on borrowings amounting to Rs.4''941.61 Lakhs (Rs.3''275.91 Lakhs) have been capitalized during the year under Capital Work in Progress. Necessary allocation/adjustment with respect to above including as required in terms of Accounting Standard 16 on Borrowing Costs shall be carried out on ascertainment of amount thereof on completion of project.

(iii) Capital Work in Progress does not include Rs.802.90 Lakhs (Rs.2''183.96 Lakhs) in respect of claims made/ bills raised towards cost of civil and other services and supplies pending verification and negotiation and shall be accounted for on finalization of amount payable with respective parties. Further'' Capital Advances (Project) includes Rs.958.59 Lakhs (Rs.2''446 Lakhs) given for various Project supplies and related services'' etc'' which even though are outstanding for long period'' steps for recovery since been taken has been considered good and recoverable. Adjustment with respect to the above will be given effect to on final settlement with the parties..

5. To the extent information were available with the Company'' there are no outstanding as at the end of the year to the parties registered under the Micro'' Small & Medium Enterprises Development Act'' 2006.

6. Keeping in view the proposed recommencement of production of the Company and emerging certainty with respect to the profitability of the Company and considering that time limit for carry forward of losses in case of Company has been extended in terms of the MS-08 Scheme sanctioned by BIFR'' the Deferred Tax Asset in respect of the carry forward business losses and depreciation has been continued to be recognized during the period. The details in this respect as required in terms of the Accounting Standard 22 on Accounting for Taxes on Income are as follows:

7. The balances in Sundry Debtors'' Deposits Retention Money'' Sundry Creditors and Advances are subject to confirmations and adjustments'' if any. Such adjustments'' in the opinion of the management'' are not likely to be material and will be carried out as and when ascertained.

8. (a)The Hon''ble BIFR has discharged the Company from the purview of Sick Industrial

Companies (Special Provisions) Act'' 1985 vide its Order dated 22nd January 2010. In terms of the said Order'' the unimplemented provisions of MS-08 (Modified Rehabilitation Scheme sanctioned by BIFR vide its Order dated 21st July 2008) would be implemented by the concerned agencies.

b) In terms of MS-08'' 13.5% Secured Redeemable Debentures are required to be settled by payment of principal amount only and interest stand waived. The Company has deposited an amount equivalent to the principal amount of these debentures marking a lien in favour of the Debenture Trustees. The unclaimed debentures at year end are shown under the head "Other Current Liabilities".

c) In terms of the said Scheme'' the fixed deposit holders are to accept outstanding principal amount in four annual installments commencing from financial year 2007-08 onwards'' on interest-free basis. The unclaimed fixed deposits at year end are shown under the head "Other Current Liabilities".

9. As the Company is engaged in the manufacture of cement within India only'' it operates in single primary business segment and single secondary geographical segment and therefore disclosure requirement of Accounting Standard 17 on Segment Reporting are not applicable to it.

10. Related Parties and transactions with them'' as identified by the management in accordance with the Accounting Standard 18'' as notified by the Companies Accounting Standard Rules'' 2006'' are as follows:

11. The Company has not made any loans or advances in the nature of loans whose particulars are required to be disclosed in terms of clause 32 of the listing agreement.

12. Working for the earnings per share in terms of AS 20 - "Earnings Per Share"

13. Current year figures relate to the period of twelve months from April 01'' 2012 to March 31'' 2013 and corresponding previous period represents nine months period ending with March 31'' 2012. Hence'' these figures are not comparable.

14. All amounts in the financial statements are presented in Rupees in Lakhs except per share data and as other wise stated. Figures in brackets represent corresponding previous period figures in respect of Statement of Profit and Loss items and in respect of Balance Sheet items as on the Balance Sheet date of the previous period. Figures for the previous period have been regrouped /rearranged wherever considered necessary.


Mar 31, 2012

1.1 The disclosures as required by Accounting Standard 15 relating to employees benefit recognized are set out below:

The employees Gratuity scheme are defined benefit plans. The present value of obligatiq are determined based on actuarial valuation using Projected Unit Credit method, whicl recognizes each period of services as giving rise to additional unit of employee benef) entitlement and measures each unit separately to build up the final obligation. The obligation for compensated absence is recognized in the same manner as gratuity.

2 The employees benefit liability of the company is not funded. Accordingly disclosures I related to return on planned assets and fair value thereof is not applicable.

W5 Assumptions relating to future salary increases, attrition, interest rate for discount have P been considered based on relevant economic factors such as inflation, market growth & other factors applicable to the period over which the obligation is expected to be settled.

3. Unredeemed First Preference Shares :

The Redeemable Cumulative First Preference Shares remain unclaimed aggregating to Rs.1.92 lakhs (Rs.1.92 lakhs). The payments against said shares are being made as and when claimed. The Company has been legally advised that in the absence of profits upto the date of redemption (i.e. 15th June, 1993), it has no obligation to pay any dividend on the said preference shares.

4. The DCW Plant of the Company was in production till the end June 2010, and production at VCW plant could not be continued from the beginning of September, 2010 and the production activities remained suspended thereafter. Repairs and maintenance, modification and up-gradation cum expansion of the Plants have already been commenced and the normal production activities will resume shortly.

5. (a) In view of the above, Confirmation of various debit and credit balances including with respect to loans and advances, deposits, liabilities, debtors could not be obtained and consequential reconciliation/ adjustments, if any, could not be given effect to in the accounts. Also physical verification of fixed assets and reconciliation thereof with the records containing individual assets could not be carried out.

(b) Further, for the purpose of these accounts:

(i)Capital Advance includes Rs.2446 lakhs (Rs.2795 lakhs) given for various Project supplies and related services, status of which pending completion of the project is presently not ascertainable. Certain such parties have intimated to forfeit the amounts lying with them and/or made claims for charges and compensations etc. on account of delay in completion of projects. Further, Advance Recoverable includes Rs.324 lakhs (Rs.324 lakhs) which are outstanding for long, have been considered good and recoverable. Adjustment with respect to the above will be given effect to on final settlement with the parties.

(ii)Balances of the sundry debtors lying outstanding since long at the end of the period, pending confirmation, are presently not ascertainable. Necessary legal and other steps are being examined and as such no provision has been considered necessary.

(iii)Claim for interest and other charges amounting to Rs.493.79 lakhs (Rs.413.20 lakhs) relating to the project to the extent ascertained from available information have not been accounted for pending finalization of amount payable.

(iv)Various claims including interest, penal and additional charges on statutory and other liabilities pending final negotiation, have not been recognized in these accounts.

(c) Based on the information available with the Company, there are no outstanding as at the end of the period to the parties registered under the Micro, Small & Medium Enterprises Development Act, 2006.

6. (a) In accordance with the Share Subscription and Share Purchase Agreement dated 15.11.2011, erstwhile promoters i.e. Duncan Goenka Group transferred their controlling stake of the Company to M/S Jaypee Development Corporation limited (JDCL), a Company belonging to Jaypee Group. JDCL has also subscribed to 14,75,00,000 equity shares of Rs. 10/- each at a premium of Rs.2/- per share aggregating to Rs. 17700 lakhs on preferential basis as per the SEBI (ICDR) regulations and the proceeds have been credited to Company's bank account. The same are being utilized for meeting the requirement of capital expenditure for modification and up gradation cum expansion of plants for recommencing the production and meeting the other requirement of the company's business. In view of this and considering the business prospects, the accounts of the Company have been drawn on the basis of going concern.

(b)ln terms of the agreement, mentioned hereinabove, Rs.7,509 lakhs payable to erstwhile promoters and other companies in respect of money advanced by them preceding the date of agreement is settled for Rs.2,000 lakhs. Out of the settlement amount an amount of Rs.1,000 lakhs has already been paid and the balance Rs.1,000 lakhs is shown under "Other Current Liabilities". The balance amount of Rs.5509 lakhs is credited back to Profit & Loss Account during the period under the head "Exceptional item/Income".

7. (a) Substantial progresses have been made in respect of up gradation-cum-expansion project undertaken by the Company to increase its production capacity. Services of reputed technical consultants have been engaged. The pre-operative expenses including interest on the borrowings amounting to Rs.3275.91 lakhs have been capitalised during the period under Capital Work in Progress. Necessary allocation adjustment with respect to above including as required in terms of Accounting Standard 16 on Borrowing Costs shall be carried out on ascertainment of amount thereof on completion of project.

(b) Capital Work in Progress does not include Rs.2183.96 lakhs (Rs.2017.98 lakhs) in respect of claims made/ bilis raised towards cost of civil and other services and supplies pending verification and negotiation and shall be accounted for on finalization of amount payable with the respective parties as per Accounting Standard 10 on Accounting for Fixed Assets,.

8. Employee benefit expenses includes arrears of salaries & wages and other expenses of Rs.1150 lakhs paid for earlier period in terms of Memorandum of Settlement u/s 18(1) of the Industrial dispute Act,1947, entered into with the Worker's Union on 6th March, 2012.

9. The Company has export obligation in connection with import of machineries under Export Promotion Capital Goods Scheme (EPCG). In the event of non-fulfillment of the export obligation upto FY 2016-17, the company may be liable for differential custom duty of Rs.838.16 lakhs (approximately) and interest thereon.

10. The claims against the Company aggregating to Rs.2259.61 lakhs, some of which are pending before various courts have been contested by the Company. In one of the litigation by a creditor, the company has been restrained by A P High Court from alienating any of its assets or creating encumbrances over the same pending disposal of the matter.

11. Remuneration amounting to Rs.39.51 lakhs payable to ex whole time Directors and ex- Managing Director, for the earlier years are pending approval of Central Government.

12. Considering the proposed recommencement of production on completion of modification and upgradation cum expansion of plants, as given in Note 38 (a) above, no material loss necessitating adjustment in terms of Accounting Standard 28 on Impairment of Assets, in respect of impairment in the value of the fixed assets is required to be carried out in the accounts.

13. Some of the agreements with suppliers/agents, statements of Bank Accounts including those of the branches/depots for the period prior to June 1994, have still not been restored by the erstwhile promoters/ management. The matter being pending considerably for long time, no material adjustment, in this respect, is likely to arise.

14.(a)The Hon'ble BIFR has vide its Order dated 22nd January 2010 declared that the Company is no more remains a sick industrial company u/s 3(1 )(c) of Sick Industrial Companies (Special Provisions) Act, 1985. In terms of the said Order, the provisions of MS-08 (Modified Rehabilitation Scheme sanctioned by BIFR vide its Order dated 21st July 2008) yet to be implemented would be implemented by the concerned agencies and shall be monitored by the Company.

(b) In terms of MS-08,13.5% Secured Redeemable Debentures are required to be settled by payment of principal amount only and interest stand waived. The Company has deposited an amount equivalent to the principal amount of these debentures marking a lien in favour of the Debenture Trustees. The unclaimed debentures at year end are shown under the head "Other Current Liabilities".

(c)ln terms of the said Scheme, the fixed deposit holders are to accept outstanding principal amount in four annual installments commencing from financial year 2007-08 onwards, on interest-free basis. The unclaimed fixed deposits at the year end are shown under the head "Other Current Liabilities".

15.The Company has certain cancellable operating lease arrangements for office accommodation taken/given on lease with a lease period of up to 3 year further extendable with mutual consent and agreement. The lease agreements can be terminated after giving notice as per terms of the lease by either party.

16. As the Company is engaged in the manufacture of cement within India only, it operates in single primary business segment and single secondary geographical segment and therefore disclosure requirement of Accounting Standard 17 on Segment Reporting are not applicable to it.

17. Related Parties and transactions with them, as identified by the management in accordance with the Accounting Standard 18, as notified by the Companies Accounting Standard Rules, 2006, are as follows:

1. Key Managerial Personnel None

2. Relatives of Key Managerial personnel None

3. Ultimate Holding Company

M/s Jaypee Infra Ventures Pvt. Ltd., being Holding Company of M/s Jaypee Development Corporation Limited (From 10.02.2012)

Holding Company

M/s Jaypee Development Corporation Limited (From 10.02.2012)

4. Associate Company

1. M/s ISG Traders Limited (Upto 09.02.2012)

2. M/s Boydell Media Pvt. Ltd (Up to 09.02.2012)

5. Enterprise over which, persons stated at S.No. (1) and (2) above have significant influence.

None

18. The Company has not made any loans or advances in the nature of loans whose particulars are required to be disclosed in terms of clause 32 of the listing agreement.

19. Current period figures relate to the period of nine months from July 01, 2011 to March 31, 2012 and corresponding previous period represents fifteen months period ending with June 30, 2011. Hence are not comparable.

20. All amounts in the financial statements are presented in Rupees in Lakhs except per share data and as other wise stated. Figures in brackets'represent corresponding previous period figures in respect of Profit and Loss items, and in respect of Balance Sheet items as on the Balance Sheet date of the previous period. Figures for the previous period have been regrouped /rearranged wherever considered necessary to conform to ; the figures presented in the current period pursuant to revised Schedule-Vl format prescribed under the Companies Act, 1956.


Mar 31, 2010

1. Amount due to Cement Regulation Authority (CRA) as on 30th June 1994 was converted into soft loan as per the BIFR Order dated 16.6.1994. In terms of subsequent Order of BIFR dated 21.7.2008, interest is waived and accordingly interest accrued in earlier years amounting to Rs. 423.24 lakhs has been written back during the year. The Company has lodged various claims against CRA, which are far in excess of the principal amount of Rs.325.03 lakhs due to CRA. The Honble Andhra Pradesh High Court has upheld the Companys claim in one of such cases. In accordance therewith this claim of Rs.160 lacs has been set off with the dues to CRA and the balance amount of Rs.165.03 lacs has been written back, as in the opinion of the management there would not be any further liability in this regard. /

2. Unredeemed First Preference Shares:

The Redeemable Cumulative First Preference Shares remain unclaimed aggregating to Rs.1.94 lakhs (Rs.2.08 lakhs) and an equivalent amount of Capital Redemption Reserve has been created during the year. The said shares are being paid as and when claimed. The Company has been legally advised that in the absence of profits upto the date of redemption (i.e. 15th June, 1993), it has no obligation to pay any dividend on the said preference shares.

3. Secured Loans (Schedule "C") :

i) OCD-A, OCD-B and NCD under l(a) and Term Loan under ll(a) are secured by first charge by way of mortgage on immovable properties and hypothecation of all movable properties, machinery, machinery spares, tools and accessories, present and future, and second charge on current assets including inventories, stores and spares, book debts, operating cash flows, receivables, etc. Further secured by first charge on Trust and Retention Account, Debt Service Reserve Account and other reserve relating to the project, pledge of 2,65,05,000 equity shares of the Company held by the promoters and personal guarantee of the Chairman.

ii) Debentures under 1(b) are secured to the extent of Rs.196.90 lakhs against deposit in a separate bank account with lien thereon in favour of Debenture Trustee. As per MS-08, principal amount is payable as and when claimed by the debenture holders after adjusting the repayments made earlier, if any.

iii) Working Capital Loans under III are secured by first charge by way of hypothecation of inventories and book debts and second charge on fixed assets of the Company. Further secured by corporate guarantee of Duncans Industries Ltd and personal guarantee of the chairman.

iv) Terms of redemption/conversion of QCD-A, OCD-B and NCD :

a. The holders have the right to convert the whole or part of the OCD-A into fully paid up equity share capital of the Company at any time before the expiry of 18 months from the date of allotment i.e. from 9** September, 2009.

b. The holders have the right to convert the whole or part of the OCD-B into fully paid up equity share capital of the Company at the end of 12th, 15th and 18th month from the date of allotment i.e. from 9"1 September, 2009.

c. The Company has the right to prepay OCD-B, in full and not in Part with internal accruals or any additional borrowings at the end of 12th, 15th and 18th month from the date of allotment by giving at least 21 days prior notice.

d. The holders have the right to convert, in the event of default committed by the Company, at its option the whole or part of the any unconverted OCDs/NCD into fully paid-up equity shares of the Company, at a price per equity share determined in accordance with the appropriate Regulatory framework (SEBI regulations) extant at the time of such default.

e. The outstanding OCDs/NCD, if conversion option not exercised/ prepaid, shall be redeemed in 24 equal quarterly installments commencing from April 15, 2012,

4. Confirmation/reconciliation of balances of some parties under Sundry Debtors, Deposits, Loans and Advances, Current Liabilities are not available for which necessary action has been initiated. Pending confirmation/reconciliation and review by the company, consequential adjustments arising thereon, are presently not ascertainable.

5. Some of the records of the company like agreements with suppliers/agents, statements of Bank Accounts including those at some of the branches/depots have still not been restored by the erstwhile promoters/ management and the same could not be verified. On restoration of such records as mentioned above, there may be some consequential adjustments to the accounts, which cannot be ascertained at this stage. Appropriate adjustments will be made as and when such records are restored and verified.

6. In the opinion of the management, the current assets, sundry debtors, loans and advances are approximately of the value stated in the Balance Sheet, if realised in the ordinary course of business.

7. (a) The Honble BIFR has discharged the Company from the purview of Sick Industrial Companies (Special Provisions) Act, 1985 vide its Order dated 22nd January 2010. In terms of the said Order, the unimpl -emented provisions of MS-08 (Modified Rehabilitation Scheme sanctioned by BIFR vide its Order dated 21st July 2008) would be implemented by the concerned agencies.

(b) In terms of MS-08, 13.5% Secured Redeemable Debentures are required to be settled by payment of principal amount only and interest stand waived. The Company has deposited an amount equivalent to the principal amount of these debentures marking a lien in favour of the Debenture Trustees. The unclaimed debentures at year end are continued to be shown as liability.

(a) Since the repay, .ent of the matured fixed deposits and debentures are covered by MS-08, the provisions of Section 205 (C) of the Companies Act 1956 requiring transfer to Investor Education and Protection Fund, do not apply to the said amount. In terms of the said Scheme, the fixed deposit holders are to accept outstanding principal amount in four annual installments commencing from financial year 2007-08 onwards, on interest-free basis.

8. As per the information available with the Company, there were no outstanding as at the year end to the parties registered under the Micro, Small & Medium enterprises Development Act, 2006.

9. Business Segment:

The Company is engaged in the manufacture of cement i.e. one business segment for "disclosure in the context of Accounting Standard 17 as notified by The Companies Accounting Standard Rules, 2006.

Geographical Segment:

During the year under report, the Company has engaged in its business only within India and not in any other Country. The conditions prevailing in India being uniform, no separate geographical disclosure is considered necessary.

10. Related Parties and transactions with them, as identified by the management in accordance with the Accounting Standard 18, as notified by The Companies Accounting Standard Rules, 2006, are as follows:

11. The Company has not made any loans or advances in the nature of loans whose particulars are required to be disclosed in terms of clause 32 of the listing agreement.

12. Working for the earnings per share in terms of AS 20 - "Earnings Per Share"

13. The Company has carried out deferred tax computation in accordance with Accounting Standard 22- Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. The Deferred Tax Assets as shown in the Balance Sheet consists of:

The Company has been allowed extension of time limit for carry forward of losses under the Income Tax Act 1961 by the appropriate authority, as recommended by Honble BIFR vide MS-08. Accordingly, Deferred Tax Asset has been recognized during the year.

14. 65,00,000 equity shares of Rs. 10/- each at a premium of Rs.13.93 per share aggregating to Rs.15.55 crores was allotted on preferential basis in February, 2010 upon conversion of warrants in to equity. The issue proceeds have been utilized for the up-gradation cum expansion project of the Company.

15. All amounts in the financial statements are presented in Rupees in Lakhs except per share data and as other wise stated. Figures in brackets represent corresponding previous year figures in respect of Profit and Loss items, and in respect of Balance Sheet items as on the Balance Sheet date of the previous year. Figures for the previous year have been regrouped /rearranged wherever considered necessary to conform to the figures presented in the current year.

 
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