Mar 31, 2015
1.1 Basis of Preparation of Financial Statements
a) These Financial Statements have been prepared to comply in all
material aspects with applicable accounting principles in India, the
applicable Accounting Standards prescribed under Section 133 of the
Companies Act, 2013 ('Act') read with Rule 7 of the Companies
(Accounts) Rules, 2014, the provisions of the Act (to the extent
notified) and other accounting principles generally accepted in India,
to the extent applicable.
b) All assets and liabilities have been classified as current or
non-current as per the Company's normal operating cycle and other
criteria set out in the Schedule III to the Companies Act, 2013. Based
on the nature of products and the time between acquisition of assets
for processing and their realisation in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the
purpose of current/non-current classification of assets and
liabilities.
c) Transactions and balances with values below the rounding off norm
adopted by the Company have been reflected as "0.00" in the relevant
notes in these Financial Statements.
1.2 Tangible Assets, Intangible Assets and Capital Work-in-Progress
a) Tangible Assets are stated at cost of acquisition less accumulated
depreciation and impairment losses, if any.
b) Expenditure which are of Capital in nature are capitalised which
comprises of purchase price and all other expenditure directly
attributable to bringing the assets to its working condition for the
intended use. Assets under erection / installation are shown as Capital
Work-in-Progress. Capital Work-in-Progress are net of CENVAT credit
availed / available thereon.
c) Intangible Assets are stated at the consideration paid for
acquisition of such assets and are carried at cost less accumulated
amortisation and impairment losses, if any.
d) Interest on borrowing costs related to qualifying assets is worked
out on the basis of actual utilisation of funds out of project specific
loans and/or other borrowings to the extent identifiable with the
qualifying assets and are capitalised with the cost of qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection / acquisition on commencement of commercial production.
e) Subsidy received / or crystallisation in respect of fixed assets are
deducted from the cost of respective assets.
f) Variations of exchange rate attributable to fixed assets are
capitalised.
1.3 Depreciation & Amortisation
a) Depreciation on Fixed Assets is calculated on the Straight Line
Method at the rate prescribed under the Schedule II of Companies Act,
2013.
b) Intangible Assets are amortised over their respective individual
estimated useful lives on a straight-line basis commencing from the
date the assets is available to the Company for its use.
1.4 Inventories
Inventories are valued at lower of Cost and Net Realisable Value. Cost
is computed on FIFO basis. Finished goods and Work-in-Progress include
cost of conversion and other overheads incurred in bringing the
inventories to their present location and condition.
1.5 Investments
Long Term Investment are valued at cost. Provision for diminution in
value of these investments is made only if such a decline other than of
temporary in nature.
1.6 Excise Duty
Excise duty on finished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of finished goods stock as on the Balance Sheet date.
1.7 Recognition of Income & Expenditures
a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
b) Sales are recognised net of trade discounts, rebates, sales tax and
excise duties.
c) Export Incentives Income arising out of Export Sales are accounted
for on accrual basis.
d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit,
Trade Discount and Claims.
e) Gain and losses from the remeasurement and settlement of financial
instrument at fair value are reported in the financial result through
profit and loss.
f) Interest income is recognised on a time proportion basis taking into
account and the amount outstanding and the rate applicable.
g) Income from commission is recognised based on
agreements/arrangements with the customers as the service is performed
using the proportionate completion method, when no significant
uncertainty exists regarding the amount of the consideration that will
be derived from rendering the service.
1.8 Subsidy
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystallisation.
b) The Company has been granted eligibility certificate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notification no. 276-CI/G/Incentive/052/05/i dt.
19.05.2005, effective from 1st April, 2004. Under the said scheme, the
Company is entitled to receive incentive on energy charges, which has
been accounted for in the books on accrual basis.
1.9 Foreign Currency Transaction
Foreign Currency Transactions are accounted for at the exchange rates
prevailing at the date of the transaction. Gains and losses resulting
from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies are
recognised in the Statement of Profit and Loss.
1.10 Taxation
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing differences, being the difference between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
1.11 Segment Reporting
The Company has identified Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with different risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard - 17 " Segment Reporting" as
issued by the 'The Institute of Chartered Accountants of India'.
1.12 Retirement Benefits
a) Liability with regards to long-term employee benefits is provided
for on the basis of actuarial valuation at the Balance sheet date.
Actuarial gain/ loss is recognised immediately in the statement of
Profit & Loss Account. The Company has an Employee Gratuity Fund
managed by the Life Insurance Corporation of India.
b) Retirement benefit in the form of contribution to Provident Fund is
a defined contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short - term compensated absences are provided for on the basis of
estimates.
1.13 Preliminary & Public Issue Expenses
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the share
premium.
1.14 Borrowing Costs
a) Borrowing costs and its related expenses that are directly att
ributable to the acquisition, construction or production of a
qualifying assets is capitalised as part of the cost of that asset.
Other borrowing costs are recognised as an expenses in the period in
which they are incurred.
b) Net exchange gain/loss on foreign currency borrowings to the extent
considered as an adjustment to interest cost is attributable to the
finance cost.
1.15 Impairment of Assets
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
charged to the statement of Profit & Loss to the extent the carrying
amount exceeds the recoverable amount.
1.16 Provision, Contingent Liabilities and Contingent Assets -
Provision involving substantial degree of estimation in measurement are
recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
Notes unless the possibility of outflow of resources is remote.
Contingent Assets are neither recognised nor disclosed in the Financial
Statements.
Mar 31, 2014
1. Basis of Preparation of Financial Statements
a) These Financial Statements have been prepared in accordance with
generally accepted accounting principle in India under the historical
cost convention on accrual basis and comply in all material aspects
with the accounting standards notifi ed under the Companies Act, 1956
(the "Act") read with the General Circular 15/2013 dated September 13,
2013 of the Ministry of Corporate Aff airs in respect of Section 133 of
the Companies Act, 2013.
(b) All the assets and liabilities have been classifi ed as current or
non-current as per the Company''s normal operating cycle and other
criteria set out in the Schedule VI to the Companies Act, 1956. Based
on the nature of services and the time between acquisition of
assets/inputs for processing and their realisation in cash and cash
equivalents, the Company has ascertained its normal operating cycle as
12 months for the purpose of current/non-current classifi cation of
assets and liabilities.
2. Use of Estimates
The preparation of Financial Statements in conformity with Generally
Accepted Accounting Principles requires that the management makes
estimates and assumptions that aff ect the reported amounts of assets
and liabilities, disclosure of contingent liabilities as at the date of
the Financial Statements, and the reported amounts of revenue and
expenses during the reported year. Actual results could diff er from
those estimates.
3. Fixed Assets, Intangible Assets and Capital Work-in-Progress
a) Fixed Assets are stated at cost of acquisition less accumulated
depreciation.
b) Expenditure which are of Capital nature are capitalised at a cost
which comprises of purchase price and all other expenditure directly
attributable to the cost of bringing the assets to its working
condition for the intended use. Assets under erection / installation
are shown as Capital Work-in-Progress. Capital assets and Capital
Work-in- Progress are net of CENVAT credit availed / available thereon.
c) Intangible assets are recorded at the consideration paid for
acquisition of such assets and are carried at cost less accumulated
amortisation and impairment.
d) Interest on borrowing costs related to qualifying assets is worked
out on the basis of actual utilisation of funds out of project specifi
c Loans and/or other borrowings to the extent identifi able with the
qualifying assets and are capitalised with the cost of qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection / acquisition on commencement of commercial production.
e) Subsidy received / or crystallisation in respect of Fixed Assets are
deducted from the cost of respective assets.
f) Variations of exchange rate attributable to Fixed Assets are
capitalised.
4. Depreciation & Amortisation
a) Depreciation on Fixed Assets is calculated on Straight Line Method
at the rates and in the manner prescribed in the Schedule XIV of
Companies Act, 1956.
b) Intangible assets are amortised over their respective individual
estimated useful lives on a straight-line basis commencing from the
date the assets is available to the Company for its use.
5. Inventories
All inventories are valued at lower of Cost, computed on FIFO basis,
and Net Realisable Value. Finished goods and Work- in-Progress include
cost of conversion and other overheads incurred in bringing the
inventories to their present location and condition.
6. Excise Duty
Excise duty on fi nished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of fi nished goods stock lying in the factory as on the
Balance Sheet date.
7. Recognition of Income & Expenditures
a) Revenue is recognised to the extent that it is probable that the
economic benefits will fl ow to the Company and the revenue can be
reliably measured.
b) Sales are recognised when the signifi cant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive
of excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
c) Export Incentives arising out of Export Sales are accounted for on
accrual basis.
d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit,
Trade Discount and Claims.
e) Interest income is recognised on a time proportion basis taking into
account and the amount outstanding and the rate applicable.
8. Subsidy
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystallisation.
b) The Company has been granted eligibility certifi cate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notifi cation no. 276-CI/O/Incentive/052/05/i dt.
19.05.2005, eff ective from 1st April, 2004. under the said scheme, the
Company is entitled to receive incentive on energy charges, which has
been accounted for in the books on accrual basis.
9. Sales
Sales are recognised on despatch of goods to customers. It includes
Excise Duty & Sales Tax.
10. Foreign Currency Transaction
Transactions denominated in foreign currencies are normally recorded at
the exchange rates prevailing on the date of the transaction. Monetary
items denominated in foreign currencies at the year end are restated at
the year end rates. All exchange diff erences are dealt within Profit
& Loss Account.
11. Taxation
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing diff erences, being the diff erence between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
12. Segment Reporting
The Company has identifi ed Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with diff erent risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard-17 "Segment Reporting" as
issued by the ''The Institute of Chartered Accountants of India''.
13. Retirement Benefits
a) Liability with regards to long term employee benefits is provided
for on the basis of actuarial valuation at the Balance sheet date.
Actuarial gain/ oss is recognised immediately in the Statement of Profi
t & Loss Account. The Company has an Employee Gratuity Fund managed by
the Life Insurance Corporation of India.
b) Retirement benefit in the form of contribution to Provident Fund is
a defi ned contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short-term compensated absences are provided for based on estimates.
14. Preliminary & Public Issue Expenses
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the Share
Premium.
15. Borrowing Costs
a) Borrowing costs and its related expenses that are directly
attributable to the acquisition, construction or production of a
qualifying asset is capitalised as part of the cost of that asset.
Other borrowing costs are recognised as an expenses in the period in
which they are incurred.
b) Net exchange gain/loss on foreign currency borrowings to the extent
considered as an adjustment to interest cost attributable to the fi
nance cost.
16. Impairment of Assets
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
recognised in the accounts to the extent the carrying amount exceeds
the recoverable amount.
17. Provision, Contingent Liabilities and Contingent Assets
Provision involving substantial degree of estimation in measurement are
recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognized but are disclosed in the
Notes. Contingent Assets are neither recognized nor disclosed in the fi
nancial statements.
18. Investments
Investments are treated as long term investments and valued at cost
less permanent diminution in value of such investments.
Terms/Rights attached to Equity Shares
The Company has only one class of Equity Shares having a par value of Rs.
10/- per share. On a show of hands, every member present in person or
by proxy, is entitled to one vote and in case of poll, the voting
rights of every member shall be in proportion to his shares of the
paid-up equity share capital of the Company.
The Company declares and pays dividends in Indian rupees. The dividend
proposed by the Board of Directors is subject to the approval of the
shareholders in the ensuing Annual General Meeting.
In the event of liquidation of the Company, the holders of Equity
Shares will be entitled to receive remaining assets of the Company,
after distribution of all preferential amounts. The distribution will
be in proportion to the number of equity shares held by the
shareholders.
During the year under review the Board of Directors has issued &
alloted 267 lacs of Equiy Shares of Rs. 10/- each at a premium of Rs.20/-
per share on preferential basis to working capital requirement of the
Company, capital expenditure for expansion and modernisation activities
and other corporate purposes. The entire proceeds received from the
said issue during the year has been fully utilised towards the object
of the issue.
A) Nature of Security
i) Term Loan are primary secured by
a) 1st pari-passu charge on fixed assets by way of equitable mortgage
of the land & building / shed along with all movable and immovable
plant & machinery and other fixed assets thereon at Chhatna Dist.
Bankura & extension of second charge on the Company''s current assets on
pari passu basis.
b) Collateral Security equitable mortgage on offi ce space at 35, C. R.
Avenue, Kolkata on pari passu basis.
c) Personal guarantee of Promoters / Director - Mr. Suresh Kumar Patni,
Mr. Rohit Patni, Mr. Ankit Patni & Mrs. Sarita Patni.
d) Corporate guarantee of four group companies - Vasupujaya Enterprises
Pvt. Ltd., Poddar Mech Tech Services Pvt. Ltd., Suanvi Trading &
Investment Co. Pvt. Ltd., Sarita Steel & Power Ltd. & pledge of
57,44,700 shares of Company in the name of promoters & group
associates.
The Company is currently facing cash fl ow shortage, which resulted in
defaults in repayment of dues. The Company has approached to the
lenders for restructuring of debts under CDR route which is under
process.
ii) Loans against Vehicle amounted toRs. 13.93 Lacs are repayable by way
of Equated Monthly Installments subsequent to taking of such loan. The
original period of such loans is 3 yrs.
iii) Unsecured Loan from Bodies Corporate from Related Parties Rs. NIL &
others aggregating to Rs. 1568.57 Lacs. The said Loans are repayable at
the option of the Company and are stated by the management to be in the
nature of Long Term Borrowings. The average rate of interest is 13.79
%.
Details of Security
Working Capital including SLC are jointly secured by hypothecation of
all the Current Assets on 1st Pari Passu Basis & 2nd pari- passu charge
by way of extension of charge on the entire Fixed Assets of factory
land, building/shed, etc. & along with equitable mortgage on offi ce
space at 35, C. R. Avenue, Kolkata on pari passu basis & personal
guarantee of Promoters/Directors & Corporate Guarantee of three group
Companies - Vasupujaya Enterprises Pvt. Ltd., Poddar Mech Tech Services
Pvt. Ltd., Suanvi Trading & Investment Co. Pvt. Ltd., Sarita Steel &
Power Ltd. & pledge of 57,44,700 shares of Company in the name of
promoters & group associates.
Working Capital Loan from Banks is secured by Personal Guarantee of
Promoters/Director - Mr. Suresh Kumar Patni, Mr. Rohit Patni, Mr. Ankit
Patni & Mrs. Sarita Patni and subservient charge on all moveable assets
including stock and debtor.
Mar 31, 2013
1. Basis of preparation of Financial Statements
a) The financial statements have been prepared as per Revised Schedule
- VI under the Companies Act 1956.
b) The financial statements have been prepared under the historical
cost convention, on going concern concept and in accordance with the
generally accepted accounting principles & the provisions of the
Companies Act 1956The Company follows mercantile system of accounting
and is in compliance with the Accounting Standards issued by The
Institute of Chartered Accountants of India''.
c) Accounting policies not specifically referred to otherwise are
consistent with generally accepted accounting principles in India.
2. Fixed Assets, Intangible Assets and Capital Work-in-Progress
a) Fixed Assets are stated at cost of acquisition less accumulated
depreciation.
b) Expenditure which are of Capital nature are capitalised at a cost
which comprises of purchase price and all other expenditures directly
attributable to the cost of bringing the assets to its working
condition for the intended use. Assets under erection / installation
are shown as Capital Work-in-Progress. Capital assets and Capital
Work-in- Progress are net of CENVAT credit availed / available thereon.
c) Intangible assets are recorded at the consideration paid for
acquisition of such assets and are carried at cost less accumulated
amortisation and impairment.
d) Interest on borrowing costs related to qualifying assets is worked
out on the basis of actual utilisation of funds out of project specific
loans and/or other borrowings to the extent identifiable with the
qualifying assets and are capitalised with the cost of qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection / acquisition on commencement of commercial production.
e) Subsidy received / or crystallisation in respect of fixed assets are
deducted from the cost of respective assets.
f) Variations of exchange rate attributable to fixed assets are
capitalised.
3. Depreciation & Amortisation
a) Depreciation on Fixed Assets is calculated on Straight Line Method
at the rates and in the manner prescribed in the Schedule XIV of
Companies Act 1956.
b) Intangible Assets are amortised over their respective individual
estimated useful lives on a straight-line basis commencing from the
date the assets is available to the Company for its use.
c) Leasehold land acquired on perpetual lease is not amortised.
4. Inventories
All inventories are valued at lower of Cost computed on FIFO basis, and
Net Realisable Value. Finished Goods and Work-in-Progress include cost
of conversion and other overheads incurred in bringing the inventories
to their present location and condition.
5. Excise Duty
Excise duty on finished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of finished goods stock lying in the factory as on the
Balance Sheet date.
6. Recognition of Income & Expenditures
a) Revenue is recognised to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can be
reliably measured.
b) Sales are recognised when the significant risks and rewards of
ownership of the goods have passed to the buyer. Sales are inclusive
of excise duty but net of trade discounts and VAT. However, excise duty
relating to sales is reduced from gross turnover for disclosing net
turnover. Domestic sales are recognised at the time of despatch of
materials to the buyer. Export sales are recognised on the issue of
bill of lading.
c) Export Incentives arising out of Export Sales are accounted for on
accrual basis.
d) Purchases are inclusive of freight and the net of CENVAT/VAT Credit,
Trade Discount and Claims.
e) Interest income is recognised on a time proportion basis taking into
account and the amount outstanding and the rate applicable.
7. Subsidy
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystallisation.
b) The Company has been granted eligibility certificate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notification no. 276-CI/O/lncentiveA)52/05/i dt.
19.05.2005, effective from 1st April 2004. Under the said scheme, the
Company is entitled to receive incentive on energy charges, which has
been accounted for in the books on accrual basis.
8. Foreign Currency Transaction
Transactions denominated in foreign currencies are normally recorded at
the exchange rates prevailing on the date of the transaction. Monetary
items denominated in foreign currencies at the year end are restated at
the year end rates. All exchange differences are dealt in the Statement
of Profit & Loss.
9. Taxation
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing differences, being the difference between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
10. Segment Reporting
The Company has identified Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with different risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard - 17 "Segment Reporting" as
issued by the ''The Institute of Chartered Accountants of India''.
11. Retirement Benefits
a) Liability with regards to long term employee benefits is provided
for on the basis of actuarial valuation at the Balance Sheet date.
Actuarial gain/ loss is recognised immediately in the Statement of
Profit and Loss Account. The Company has an Employee Gratuity Fund
managed by the Life Insurance Corporation of India.
b) Retirement benefit in the form of contribution to Provident Fund is
a defined contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short-term compensated absences are provided for based on estimates.
12. Preliminary & Public Issue Expenses
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the share
premium.
13. Borrowing Costs
a) Borrowing costs and its related expenses that are directly
attributable to the acquisition, construction or production of a
qualifying assets is capitalised as part of the cost of that asset.
Other borrowing costs are recognised as an expenses in the period in
which they are incurred.
b) Net exchange gain/loss on foreign currency borrowings to the extent
considered as an adjustment to interest cost attributable to the
finance cost.
14. Impairment of Assets
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
recognised in the accounts to the extent the carrying amount exceeds
the recoverable amount.
15. Provision, Contingent Liabilities and Contingent Assets
Provision involving substantial degree of estimation in measurement are
recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
Notes. Contingent Assets are neither recognised nor disclosed in the
financial statements.
16. Investments
Investments are treated as long term investments and valued at cost
less permanent diminution in value of such investments.
Mar 31, 2012
1. Basis of preparation of financial statements :
a) The financial statements have been prepared as per Revised Schedule
- VI under the Companies Act, 1956.
b) The financial statements have been prepared under the historical
cost convention, on going concern concept and in accordance with the
generally accepted accounting principles & the provisions of the
Companies Act, 1956. The Company follows mercantile system of
accounting and is in compliance with the Accounting Standards issued by
'The Institute of Chartered Accountants of India1.
c) Accounting policies not specifically referred to otherwise are
consistent with generally accepted accounting principles in India.
2. Fixed Assets, Intangible Assets and Capital Work-in-Progress :
a) Fixed Assets are stated at cost of acquisition less accumulated
depreciation.
b) Expenditure which are of Capital nature are capitalised at a cost
which comprises of purchase price and all other expenditure directly
attributable to the cost of bringing the assets to its working
condition for the intended use. Assets under erection/ installation are
shown as Capital Work-in-Progress. Capital Assets and Capital
Work-in-Progress are net of CENVAT credit availed/available thereon.
c) Intangible Assets are recorded at the consideration paid for
acquisition of such assets and are carried at cost less accumulated
amortisation and impairment.
d) Interest on borrowing costs related to qualifying assets is worked
out on the basis of actual utilisation of funds out of project specific
loans and/or other borrowings to the extent identifiable with the
qualifying assets and are capitalised with the cost of qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection/acquisition on commencement of commercial production.
e) Subsidy received/or crystallisation in respect of Fixed Assets are
deducted from the cost of respective assets.
f) Variations of exchange rate attributable to Fixed Assets are
capitalised.
3. Depreciation & Amortisation :
a) Depreciation on Fixed Assets is calculated on Straight Line Method
at the rates and in the manner prescribed in the Schedule XIV of
Companies Act,1956.
b) Intangible Assets are amortised over their respective individual
estimated useful lives on a straight-line basis commencing from the
date the assets is available to the Company for its use.
4. Inventories :
All inventories are valued at lower of Cost, computed on FIFO basis,
and Net Realisable Value. Finished goods and Work-in-Progress include
cost of conversion and other overheads incurred in bringing the
inventories to their present location and condition.
5. Excise Duty :
Excise duty on finished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of finished goods stock lying in the factory as on the
Balance Sheet date.
6. Recognition of Income & Expenditures:
Revenue/Income and Cost/Expenditures are generally accounted for on
accrual basis as they are earned or incurred. Insurance & other claims
to the extent considered recoverable, are accounted for in the year of
claims. However claims and refunds whose recovery cannot be ascertained
with reasonable certainty, are accounted for on acceptance basis.
7. Subsidy :
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystallisation.
b) The Company has been granted eligibility certificate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notification no. 276-CI/O/Incentive/052/05/i dt.
19.05.2005, effective from 1st April, 2004. Under the said scheme, the
Company is entitled to receive incentive on energy charges, which has
been accounted for in the books on accrual basis.
8. Sales :
Sales are recognised on despatch of goods to customers. It includes
Excise Duty & Sales Tax.
9. Foreign Currency Transaction :
Transactions denominated in foreign currencies are normally recorded at
the exchange rates prevailing on the date of the transaction. Monetary
items denominated in foreign currencies at the year end are restated at
the year end rates. All exchange differences are dealt within Profit &
Loss Account.
10. Taxation :
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing differences, being the difference between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
11. Segment Reporting :
The Company has identified Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with different risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard-17 "Segment Reporting"as
issued by the'The Institute of Chartered Accountants of India1.
12. Retirement Benefits:
a) Liability with regards to long-term employee benefits is provided
for on the basis of actuarial valuation at the Balance Sheet date.
Actuarial gain/loss is recognised immediately in the Statement of
Profit and Loss Account. The Company has an Employee Gratuity Fund
managed by the Life Insurance Corporation of India.
b) Retirement benefit in the form of contribution to Provident Fund is
a defined contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short-term compensated absences are provided for based on estimates.
13. Preliminary & Public Issue Expenses :
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the share
premium.
14. Borrowing Costs :
a) Borrowing costs and its related expenses that are directly
attributable to the acquisition, construction or production of
qualifying assets is capitalised as part of the cost of that asset.
Other borrowing costs are recognised as expenses in the period in which
they are incurred.
b) Net exchange gain/loss on foreign currency borrowings to the extent
considered as an adjustment to interest cost attributabe to the finance
cost.
15. Impairment of Assets:
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
recognised in the accounts to the extent the carrying amount exceeds
the recoverable amount.
16. Provision, Contingent Liabilities and Contingent Assets:
Provision involving substantial degree of estimation in measurement are
recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
Notes. Contingent Assets are neither recognised nor disclosed in the
financial statements.
17. Investments:
Investments are treated as long-term investments and valued at cost
less permanent diminution in value of such investments.
Mar 31, 2011
1. Basis of preparation of financial statements
a) The financial statements have been prepared under the historical
cost convention, on going concern concept and in accordance with the
generally accepted accounting principles & the provisions of the
Companies Act, 1956. The Company follows mercantile system of
accounting and is in compliance with the Accounting Standards issued by
The Institute of Chartered Accountants of India'.
b) Accounting polices not specifically referred to otherwise are
consistent with generally accepted accounting principles in India.
2. Fixed Assets
a) Fixed Assets are stated at cost of acquisition less accumulated
deprecation.
b) Expenditure which are of Capital nature are capitalised at a cost
which comprises of purchase price and all other expenditure directly
attributable to the cost of bringing the assets to its working
condition for the intended use. Assets under erection/installation are
shown as Capital work-in-progress. Capital assets and Capital
work-in-progress are net of CENVAT credit availed/available thereon.
c) Interest on borrowing costs related to qualifying assets is worked
out on the basis of actual utilisation of funds out of project specific
loans and/or other borrowings to the extent identifiable with the
qualifying assets and are capitalized with the cost of qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection/acquisition on commencement of commercial production.
d) Subsidy received/or crystallisation in respect of fixed assets are
deducted from the cost of respective assets.
3. Depreciation
Deprecation on Fixed Assets is calculated on straight line method at
the rates and in the manner prescribed in the Schedule XIV of the
Companies Act, 1956.
4. Inventories
All inventories are valued at lower of cost, computed on FIFO basis and
Net Realisable Value. Finished goods and work- in-progress include cost
of conversion and other overheads incurred in bringing the inventories
to their present location and condition.
5. Excise Duty
Excise duty on finished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of finished goods stock lying in the factory as on the
Balance Sheet date.
6. Recognition of Income & Expenditures
Revenue/Income and Cost/Expenditures are generally accounted for on
accrual basis as they are earned or incurred. Insurance & other claims
to the extent considered recoverable, are accounted for in the year of
claims. However claims and refunds whose recovery cannot be ascertained
with reasonable certainty, are accounted for on acceptance basis.
7. Subsidy
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystallisation.
b) The Company has been granted eligibility certificate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notification no. 276- CI/O/lncentive/052/05/i dt.
19th May, 2005, effective from 1st April, 2004. Under the said scheme,
the Company is entitled to receive incentive on energy charges, which
has been accounted for in the books on accrual basis.
8. Sales
Sales are recognised on despatch of goods to customers. It includes
Excise Duty & Sales tax.
9. Foreign Currency Transaction
Transactions denominated in foreign currencies are normally recorded at
the exchange rates prevailing on the date of the transaction. Monetary
items denominated in foreign currencies at the year end are restated at
the year end rates. All exchange differences are dealt within Profit &
Loss Account.
10. Taxation
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961, Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing differences, being the difference between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
11. Segment Reporting
The Company has identified Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with different risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard-17 "Segment Reporting" as
issued by the The Institute of Chartered Accountants of India'.
12. Retirement Benefits
a) Liability with regards to long term employee benefits is provided
for on the basis of actuarial valuation at the Balance Sheet date.
Actuarial gain/loss is recognised immediately in the statement of
Profit and Loss Account. The Company has an Employee Gratuity Fund
managed by the Life Insurance Corporation of India.
b) Retirement benefit in the form of contribution to Provident Fund is
a defined contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short-term compensated absences are provided for based on estimates.
13. Preliminary & Public Issue Expenses
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the share
premium.
14. Borrowing Costs
Borrowing costs and its related expenses that are directly attributable
to the acquisition, construction or production of a qualifying assets
is capitalised as part of the cost of that asset. Other borrowing costs
are recognised as an expenses in the period in which they are incurred.
15. Impairment of Assets
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
recognised in the accounts to the extent the carrying amount exceeds
the recoverable amount.
16. Provision, Contingent Liabilities and Contingent Assets
Provision involving substantial degree of estimation in measurement are
recognised when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognised but are disclosed in the
Notes. Contingent Assets are neither recognised nor disclosed in the
financial statements.
17. Investments
Investments are treated as long term investments and valued at cost.
Mar 31, 2010
1. Basis of preparation of financial statements
a) The financial statements have been prepared under the historical
cost convention, on Going Concern Concept and in accordance with the
Generally Accepted Accounting Principles & the provisions of the
Companies Act, 1956. The Company follows Mercantile System of
accounting and is in compliance with the Accounting Standards issued by
The Institute of Chartered Accountants of India.
b) Accounting policies not specifically referred to otherwise are
consistent with Generally Accepted Accounting Principles in India.
2. Fixed Assets
a) Fixed Assets are stated at cost of acquisition less accumulated
depreciation.
b) Expenditure which are of Capital nature are capitalized at a cost
which comprises of purchase price and all other expenditure directly
attributable to the cost of bringing the assets to its working
condition for the intended use. Assets under erection/installation are
shown as Capital Work-in-Progress. Capital Assets and Capital
Work-in-Progress are net of CENVAT Credit availed/available thereon.
c) Interest on borrowing costs related to Qualifying assets is worked
out on the basis of actual utilisation of funds out of project specific
loans and/or other borrowings to the extent identifiable with the
qualifying assets and are capitalized with the cost of Qualifying
assets. Incidental indirect expenses relating to the project are
apportioned amongst the Fixed Assets on the basis of their cost of
erection/acquisition on commencement of commercial production.
d) Subsidy received/or crystallization in respect of fixed assets are
deducted from the cost of respective assets.
3. Depreciation
Depreciation on Fixed Assests is calculated on Straight Line Method at
the rates and in the manner prescribed in the Schedule XIV of Companies
Act,1956.
4. Inventories
All inventories are valued at lower of Cost, computed on FIFO basis and
Net Realisable Value. Finished Goods and Work-in-Progress include cost
of conversion and other overheads incurred in bringing the inventories
to their present location and condition.
5. Excise Duty
Excise duty on finished goods lying at the factory is accounted for at
the point of manufacturing of goods and is accordingly considered for
valuation of finished goods stock lying in the factory as on the
Balance Sheet date.
6. Recognition of Income & Expenditures
Revenue/Income and Cost/Expenditures are generally accounted for on
accrual basis as they are earned or incurred. Insurance & other claims
to the extent considered recoverable, are accounted for in the year of
claims. However, claims and refunds whose recovery cannot be
ascertained with reasonable certainty, are accounted for on acceptance
basis.
7. Subsidy
a) The Company is registered under the West Bengal Incentive Scheme
2000 & 2004 of The Director of Industries, Government of West Bengal.
Under the said scheme, the Company is entitled to receive Capital
Investment Subsidy, Interest Subsidy, Employment Generation Subsidy,
Remission of Stamp Duty & Registration Fee. These shall be accounted
for in the year of receipt and/or crystalisation.
b) The Company has been granted eligibility certificate under the West
Bengal Incentives to Power Intensive Industries Scheme, 2005,
promulgated by the Department of Commerce & Industries, Government of
West Bengal, vide notification no. 276- CI/O/lncentive/052/05/i dt.
19.05.2005, effective from 1st April, 2004. Under the said scheme, the
Company is entitled to receive incentive on energy charges, which has
been accounted for in the books on accrual basis.
8. Sales
Sales are recognised on despatch of goods to customers. It includes
Excise Duty & Sales Tax.
9. Foreign Currency Transaction
Transactions denominated in foreign currencies are normally recorded at
the exchange rates prevailing on the date of the transaction. Monetary
items denominated in foreign currencies at the year end are restated at
the year end rates. All exchange differences are dealt within Profits
Loss Account.
10. Taxation
a) Current Tax is determined at the amount of tax payable in respect of
taxable income for the period, computed with relevant tax rules and tax
laws. In case of tax payable as per provisions of MAT under Section
115JB of the Income Tax Act, 1961 Deferred MAT Credit Entitlement is
separately recognised as advance.
b) Deferred Tax is recognised, subject to the consideration of
prudence, on timing differences, being the difference between taxable
income and accounting income that originate in one period and are
capable of reversal in one or more subsequent periods.
11. Segment Reporting
The Company has identified Iron & Steel as the sole business segment
and the same has been treated as primary business segment. The Company
sells mostly within India and does not have operations in economic
environments with different risks and returns, it is considered
operating in single geographical segment. Hence, no further disclosure
as required under the Accounting Standard -17" Segment Reporting" as
issued by the The Institute of Chartered Accountants of India.
12. Retirement Benefits
a) Liability with regards to long term employee benefits is provided
for on the basis of actuarial valuation at the Balance Sheet date.
Actuarial gain/loss is recognised immediately in the statement of
Profit & Loss Account. The Company has an Employee Gratuity Fund
managed by the Life Insurance Corporation of India.
b) Retirement Benefit in the form of contribution to Provident Fund is
a defined contribution scheme and is charged to Profit & Loss Account
in the year when they become due.
c) Short-term compensated absences are provided for based on estimates.
13. Preliminary & Public Issue Expenses
As the future economic benefit of Preliminary & Public Issue Expenses
is not ascertainable & thus the same is adjusted with the Share
Premium.
14. Borrowing Costs
Borrowing Costs and its related expenses that are directly attributable
to the acquisition, construction or production of a Qualifying assets
is capitalised as part of the cost of that asset. Other borrowing costs
are recognised as an expenses in the period in which they are incurred.
15. Impairment of Assets
At each Balance Sheet date the Company assesses whether there is any
indication that assets may be impaired. If any such indication exists,
the Company estimates the recoverable amount. If the carrying amount of
the assets exceeds its recoverable amount, an impairment loss is
recognised in the accounts to the extent the carrying amount exceeds
the recoverable amount.
16. Provision, Contingent Liabilities and Contingent Assets
Provision involving substantial degree of estimation in measurement are
recognized when there is a present obligation as a result of past
events and it is probable that there will be an outflow of resources.
Contingent Liabilities are not recognized but are disclosed in the
notes. Contingent Assets are neither recognized nor disclosed in the
financial statements.
17. Investments
Investments are treated as long term investments and valued at cost.
B. NOTES ON ACCOUNTS
1. Contingent Liabilities not provided for in the books of Accounts:
a) In respect of Bills Discounted, outstanding as on 31.03.2010
amounting to Rs. 1259.02 Lacs (Previous year - Rs. 1951.46 Lacs).
b) In respect of Letter of Credit amounting to Rs. 508.92 Lacs
(Previous year - Rs. 2254.26 Lacs) & Bank Guarantee amounting to Rs.
254.55 Lacs (Previous year - Rs. 275.55 Lacs).
c) Commitments against Capital Expenditure not provided in the accounts
(Net of Advances) Rs. 1238.35 Lacs (Previous year - Rs. 180.00 Lacs).
d) Relating to assessment year 2006-07 & 2007-08, a demand of Rs. 21.11
Lacs & Rs. 3.54 Lacs was raised by the D. C. I. T. Circle -3, Kolkata
against which the Company has filed an appeal. An amount of Rs. 11.11
Lacs was paid under protest relating to year 2006-07.
e) Relating to assessment year 2005-06 & 2006 -07, a demand of Rs.
318.99 Lacs & Rs. 1003.34 Lacs was raised by the department against
which appeal has been filed by the Company.
f) Excise Duty Liability arising out of search operation by the
Directorate General of Central Excise Intelligence. However, the
Company has paid under protest a sum of Rs. 1.20 Crore pending issuance
of any show cause notice.