Notes to Accounts of Bannari Amman Sugars Ltd.
Mar 31, 2018
Appendix B to Ind AS 21
The appendix clarifies how to determine the date of transaction for the exchange rate to be used on initial recognition of the related asset, expense or income (or part of it) where an entity pays or receives consideration in advance for foreign currency-denominated contracts. For a single payment or receipt, the date of the transaction should be the date on which entity initially recognises the non-monetary asset or liability arising from advance consideration towards such assets, expenses or income. If there are multiple payments or receipts in advance, then an entity must determine transaction date for each payment or receipt of advance consideration.
The effect of this amendment on the financial statement of the company is being evaluated.
1.1 Rupee term loan of Rs. 4950 Lakhs (Rs.6750 Lakhs) from HDFC Bank Ltd is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III .
The loan carries Interest at the rate of Bankâs Base rate plus 1% and repayable in 20 equal quarterly instalments starting from January 2016.
The loan amount repayable within twelve months Rs 1800 lakhs (Rs.1800 Lakhs) is grouped under Other Current Liabilities.
1.2 Rupee term loan of Rs. Nil (Rs.4950 Lakhs) from State Bank of India is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III .
The loan carried Interest at the rate of Bankâs Base rate plus 1% and amount repayable during the year was Rs.1800 Lakhs. The entire loan has been repaid during November 2017
1.3 Rupee term loan of Rs. 2000 Lakhs (Nil) from HDFC Bank Ltd is secured by pari passu first charge on the movable fixed assets of Sugar Unit I.
The loan carries Interest at the rate of 1 Year MCLR rate and repayable in 20 equal quarterly instalments starting from December 2018.
The loan amount repayable within twelve months Rs 200 lakhs is grouped under Other Current Liabilities.
1.4 Rupee term loan of Rs. 1100 Lakhs (Rs.1500 Lakhs) from The Federal Bank Ltd is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III .
The loan carries Interest at the rate of Bankâs Base rate plus 0.60% and repayable in 20 equal quarterly instalments starting from January 2016.
The loan amount repayable within twelve months Rs 400 lakhs (Rs.400 Lakhs) is grouped under Other Current Liabilities.
1.5 Corporate loan of Rs. Nil (Rs.7500 Lakhs) from State Bank of India is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II .
The loan carried Interest at the rate of Bankâs Base rate plus 1% and loan repayable during the year was Rs.937.50 Lakhs. The entire loan has been repaid during September 2017.
1.6 Term loan of Rs. Nil (Rs.4687.50 Lakhs) from HDFC Bank Ltd is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II .
The loan carried Interest at the rate of Bankâs Base rate plus 1% and loan repayable during the year was Rs.1250 Lakhs. The entire loan has been repaid during November 2017.
1.7 Term loan of Rs. Nil (Rs.10000 Lakhs) from ICICI Bank Ltd is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II .
The loan carried Interest at the rate of Bankâs Base rate plus 0.75% and loan repayable during the year was Rs.937.50 Lakhs. The entire loan has been repaid during September 2017.
1.8 Loan from Sugar Development Fund (Government of India) availed for setting up of cogeneration plant in Sugar Unit-IV, amounting to Rs. 961.39 Lakhs (Rs.1442.09 lakhs) is secured by way of first charge on the movable and immovable properties of Sugar Unit-IV and first pari passu charge on the movable and immovable properities of cogeneration plant in Sugar Unit IV.
The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. Repayment of principal commenced after the expiry of three years and in ten equal half yearly installments. The interest on the loan shall be paid half-yearly from the date of disbursement. The loan was disbursed during the financial year 2013.
The loan amount repayable within twelve months Rs 480.69 lakhs (Rs.480.70) is grouped under Other Current Liabilities.
1.9 Loan from Sugar Development Fund (Government of India) availed for implementation of the schemes aimed at development of sugar cane in the factory area of Sugar Unit-II, amounting to Rs. 236.25 Lakhs (Rs.371.25 lakhs) is secured by way of exclusive second charge on the movable and immovable properties of Sugar Unit-II.
Repayment of principal commenced after the expiry of three years and in four equal annual installments. The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. The loan was disbursed in two instalments of Rs. 270 lakhs each.The interest on the first instalment of Rs.270 lakhs disbursed during the financial year 2013 is payable annually and the interest on the second instalment of Rs.270 lakhs disbursed during the financial year 2014 is payable half yearly from the date of disbursement
The loan amount repayable within twelve months Rs 135 lakhs (Rs.135 Lakhs) is grouped under Other Current Liabilities
1.10 Loan from Sugar Development Fund (Government of India) availed for modernisation cum expansion of Sugar Unit-III, amounting to Rs. 3040.24 Lakhs (Rs.480.06 Lakhs) is secured by way of pari passu first charge basis on the immovable and movable properties of Sugar plant at Sugar Unit-III.
The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. Repayment of principal and payment of interest thereon commenced after the expiry of one year of the repayment the bank term loan and interest thereon or on the expiry of a period of 5 years reckoned from the date of disbursement whichever is earlier.
1.11 Loan from Sugar Development Fund (Government of India) availed for setting up of 20 MW bagasse based cogeneration plant at Sugar Unit-III, amounting to Rs. 2107.73 Lakhs (Nil) is secured by way of pari passu first charge basis on the immovable and movable properties of cogeneration plant at Sugar Unit-III.
The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. Interest shall be paid half yearly for the first three years from the date of each disbursement after which it shall be paid half yearly alongwith repayment of principal.
Repayment of principal shall commence after expiry of three years reckoned from the date of each disbursement and it shall be paid in ten half yearly instalments.
1.12 Loan of Rs.2386.67 Lakhs (Rs.5006.67 Lakhs) under SEFASU notified by Government of India availed from Punjab National Bank, The HDFC Bank Ltd and Indian Overseas Bank is secured by residual third charge on all fixed assets forming part of block assets and land and buildings of Sugar Units I, II, III and IV.
The loan availed from Punjab National Bank and HDFC Bank Ltd carries interest at the rate of 12% per annum and loan availed from Indian Overseas Bank carries interest at the rate of Bankâs base rate plus 0.50%. The loan is eligible for interest subvention upto 12% and is repayble in 36 equal monthly installments after the expiry of 2 years from the date of disbursement.
The loan amount repayable within twelve months Rs 2386.67 lakhs (Rs.2620 lakhs) is grouped under Other Current Liabilities .
1.13 Loan of Rs.407.67 Lakhs (Rs.783.66 Lakhs) under SEFASU notified by Government of India availed from Central Bank of India and The Karur Vysya Bank Ltd is secured by residual first charge on all fixed assets of Sugar Unit V.
The loan availed from Central Bank of India carries interest at the rate of 12% per annum and loan availed from The Karur Vysya Bank Ltd carries interest at the rate of Bankâs base rate plus 0.50%. The loan is eligible for interest subvention upto 12% and is repayble in 36 equal monthly installments after the expiry of 2 years from the date of disbursement.
The loan amount repayable within twelve months Rs.376 Lakhs (Rs 376 Lakhs) is grouped under Other Current Liabilities.
1.14 Loan of Rs.Nil (Rs.3282.50 Lakhs) under SOFT LOAN notified by Government of India availed from The HDFC Bank Ltd and Union Bank of India is secured by residual third charge on all fixed assets forming part of block assets and land and buildings of Sugar Units I, II, III and IV.
The loan is eligible for interest subvention. The loan amount repayable during the year was Rs 1745 lakhs. The entire loan has been repaid during August 2017.
1.15 The interest free loan availed by Madras Sugars Limited from a related party is repayable as specified in the scheme of Amalgamation and the same will continue to be interest free loan until repayment.
1.16The purchase tax of Rs. 164.32 lakhs (Rs.164.32 lakhs) payable to Government of Karnataka for purchase of Sugarcane to sugar Unit III during the Year ended 31.03.2015 has been converted into interest free loan. The loan is secured by issue of Bank Guarantee from ICICI Bank Limited. The loan is repayable in five annual instalments from the sixth year of Conversion into Loan.
2.1 Cash Credit and other Working Capital Limits/ Demand Loan sanctioned by Punjab National Bank consortium consists of Punjab National Bank, Canara Bank, The Federal Bank Ltd, The Karur Vysya Bank Ltd, Indian Overseas Bank, State Bank of India, Bank of India, Axis bank Ltd, ICICI Bank Ltd and The HDFC Bank Ltd to the companyâs Sugar Units I, II, III and IV are secured by way of hypothecation of current assets and other movable block assets of the sugar units and third mortgage on the immovable properties of the Sugar units I, II, III and IV.
The credit limit availed as at 31.3.2018 is Rs. 15041.09 Lakhs (Rs.18522.33 Lakhs)
The availed limits are repayable on demand and carries interest rates between Bankâs base rate plus 0.25% and 1% per annum.
2.2 The Unsecured Short term loan of Rs.2500 lakhs (Rs.15000 lakhs) from HDFC Bank Ltd is repayable within ninety days from the date of availment and carries interest at the rate of 8% per annum.
The Unsecured short term Farmer Finance loan of Rs. 2585.74 lakhs (Rs.5418.41 lakhs) from HDFC Bank Ltd is repayable within one hundred and eighty days from the date of availment and carries interest at 8.05% per annum.
The unsecured loan of Rs.Nil (Rs.2028.55 lakhs) from Axis Bank Ltd repaid during the year.
The other unsecured loan of Rs. 5000 lakhs availed by M/s Madras Sugars Limited from the related parties will be repaid as specified in the scheme of amalgamation.
The vendors of the Company are yet to submit their status under Micro, Small and Medium Enterprises; hence the relevant information is not available with the company. Accordingly no disclosures relating to Micro, Small and Medium Enterprises have been made in the accounts.
3. CONTINGENT LIABILITIES AND COMMITMENTS
(to the extent not provided for) Contingent liabilities
3.1. The company has preferred a Writ Appeal before the Division Bench of the Honâble High Court, Madras challenging the Order pronounced in Writ Petition No. 4030/2002 dated 28.02.2006 in connection with increase in rate of water charges and the method of computation of water charges pursuant to the G.O. No.474 dated 13.11.2001 for the water drawn for industrial purposes. The approximate amount under dispute is Rs.417.66 Lakhs (Rs. 408.14 Lakhs)
3. 2. Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the sugar production as Free Sugar for a period of 8 years from 1985-86 Sugar Season. Chief Director (Sugar), Directorate of Sugar Department of Food New Delhi has restricted the entitlement of Free sale Sugar Incentive to 275000 quintals production per season by a subsequent notification. A Writ Petition has been filed in the Madras High Court Challenging the restriction imposed and interim injunction has been obtained. By virtue of injunction order the entire production was sold as Free Sugar.
The approximate unprovided quantum under dispute is Rs. 683.35 Lakhs.
3.3. The Entry Tax of Rs. 188.29 lakhs on Inter-state purchase of rough blocks is disputed
3.4. The Company has received a demand for payment of excise duty for Rs.148.44 lakhs on the machineries purchased for co-generation plant in Sugar Unit-II which have been cleared by the manufacturers based on the certificates alleged to have been forged by an Official in the Ministry of Finance. The Company has remitted the amount under protest. The company opted for obtaining a valid certificate for which steps have been taken through a writ petition filed in Honâble High Court of Madras.
3.5. The company has preferred an appeal before the Commissioner of Income Tax (Appeals) challenging the order of Assistant Commissioner of Income Tax in connection with disallowance of deduction for the Assessment year 2013-14. The quantum under dispute is Rs.1.60 Lakhs.
3.6. Estimated amount of contracts remaining to be executed on capital account - Tangible Assets not provided for is Rs.277.93 Lakhs (Rs. 461.72 lakhs).
4. Segment Information for the year ended 31st March 2018
Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment/manpower efforts. Income or Expenses which are not attributable or allocable to segments have been disclosed as unallocable Income / Expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. Geographical revenues are allocated based on the location of the customer. The Company has the following operating segments, which are its reportable segments. These operating segments have been identified on the basis of nature of products and other quantitative criteria specified in the Ind AS 108.
1. Sugar
2. Power
3. Distillery
4. Granite Products
Operating segment disclosures are consistent with the information provided to and reviewed by the Chief Operating Decision Maker (CODM).
5 Related Party disclosures
1 KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam, Chairman Sri B Saravanan, Managing Director
2 RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam Relatives
Sri B Saravanan (Son)
Sri B Saravanan Relatives
Sri S V Balasubramaniam (Father)
3 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
1. Annamallai Enterprise Private Limited
2. Annamallai Estates Private Limited
3. Bannari Amman Exports Private Limited
4. Bannari Amman Finance Private Limited
5. Shiva Cargo Movers Private Limited
6. Shiva Distilleries Private Limited
7. SVB Holdings Private Limited
6 Previous yearâs figures have been regrouped / reclassified wherever necessary to correspond with the current yearâs classification / disclosure
7 Foreign currency exposures that are not hedged by a derivative instrument or otherwise are as under :-
8. The dividend is paid to Non Resident shareholders in Indian Rupee by crediting to their Rupee Bank account.
a) Fair Value Hierarchy
Fair Value Measurement Hierarchy of Financial Instruments :
The Company uses the following fair value hierrachy for determining and disclosing the fair value of the finanicial instruments
Level 1 : quoted prices (unadjusted) in active markets for identical assets or liabilties
Level 2 : inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly
Level 3 : inputs that are unobservable for the asset or liability.
Fair Value Measured at amortised Cost:
The carrying amount of financial assets and liabilities measured at amortised cost in the financial statements are a reasonable approximation of their fair values since the company does not anticipate that the carrying amount would be singicantly different from the values that would eventually be received or settled.
9. Financial Risk Management - Objectives & Policies
The Companyâs principal financial liabilities includes borrowings, trade payable and other financial liabilities. The main purpose of these financial liabilities is to finance the Companyâs operations. The Companyâs principal financial assets include trade receivables, cash and cash equivalents and other financial assets that derive directly from its operations.
The Company is exposed to credit risk, liquidity risk and market risk. The Companyâs senior management under the supervision of Risk management committee / Board of Directors oversees the management of these risks and the appropriate financial risk governance framework for the Company. The senior management provides assurance that the Companyâs financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Companyâs policies and risk objectives.
a) Market risk
Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: interest rate risk, currency risk and other risks, such as regulatory risk and commodity price risk.
i) Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The Companyâs exposure to the risk of changes in market interest rates relates primarily to the Companyâs borrowings obligations with floating interest rates. Interest rate risk is managed maintaining a combination of fixed and floating rate debt and cash management policies. There is no material interest risk to the companyâs financial liabilities.
ii) Foreign currency risk
Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Companyâs exposure to the risk of changes in foreign exchange rates relates primarily to the Companyâs foreign currency denominated financial assets and financial liabilities.
iii) Commodity price risk
The realisation gets adversly affected during downturn since sugar industry is cyclic in nature. Higher cane price or higher production than the demand ultimately affect profitability. The Company has mitigated this risk by well integrated business model by diversifying into co-generation and distillation, thereby utilizing the by-products.
b) Credit risk
Credit risk is the risk that counterparty will not meet its obligations under a financial instrument leading to a financial loss. Credit risk arising from trade receivables is managed in accordance with the Companyâs established policy, procedures and control relating to customer credit risk management. The Company had managed the credit risk with respect to trade receivables by selling majority of sugar sales covering minimal portion on credit basis.
The Companyâs exposure and credit ratings of its counterparties are continuously monitored and the aggregate value of transactions is reasonably spread amongst the counterparties. The company manages the risk by credit aprroval. Credit quality of a customer is assessed based on a detailed study of credit worthiness and accordingly individual credit limits are defined/modified.
The impairment for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Companyâs past history, existing market conditions as well as forward looking estimates at the end of each balance sheet date.
Financial assets are written off when there is no reasonable expectation of recovery. However, the Company continues to attempt to recover the receivables and are recognised in the Statement of Profit and Loss when recovered.
c) Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in raising funds to meet commitments associated with financial instruments that are settled by delivering cash or another financial asset. Liquidity risk may result for an inability to sell a financial asset quickly close to its fair value.
The Company has an established liquidity risk management framework for managing its short term, medium term and long term funding. The Company also has adequate credit facilities agreed with banks to ensure that there is sufficient cash to meet all its normal operating commitments in a timely and cost-effective manner.
10. Capital Management
Capital includes paid up equity capital and all other equity reserves attributable to the equity shareholders of the Company for the purpose of Capital Management of the Company. The objective of Capital Management is to safeguard its ability to continue as a going concern so that it can continue to provide returns to shareholders and other stake holders.
The Company manages its capital structure and makes adjustments in light of changes in the financial condition and the requirements of the financial covenants. The capital structure of the Company consist of net debt and total equity of the Company.
In order to achieve this overall objectives, the Companyâs capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. The Company has complied with these covenants and there have been no breaches in the financial covenants of any interest-bearing loans and borrowings.
No changes were made in the objectives, policies or processes for managing capital during the year ended 31st March, 2018
11. Reconciliation of effective tax rate
The tax expense for the year can be reconciled to the accounting profit as follows :
The tax rate used above for the reconciliation of income tax expenses for years 2016-17 and 2017-18 is the corporate tax rate of 34.608% (30% surcharge @ 12% and education cess @ 3%) payable on taxable profits under the Income Tax Act, 1961
12. Events occuring after Balance Sheet date
The Board of Directors at its meeting held on 25.05.2018 have recommended a payment of final dividend of Rs.10 Per equity share for the year ended 31st March, 2018 amounting to Rs.1509.25 lakhs including dividend distribution tax of Rs. 255.28 lakhs.
The above is subject to approval at the ensuing Annual General Meeting of the Company and hence is not recognised as a liability.
Mar 31, 2017
NOTE 1. EQUITY
a. Reconciliation of the shares outstanding at the beginning and at the end of the reporting period
b. Details of shareholders holding more than 5% shares in the company
c. Terms/rights attached to equity shares
The company has issued only one class of equity shares having face value of Rs. 10/- each. One equity share carries one vote. The members are entitled to vote in accordance with their shareholding. The Company declares and pays dividend in Indian rupees. The dividend recommended by the board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
2.1 Rupee term loan of Rs. 6750 Lakhs (31.03.2016 -Rs.8550 Lakhs and 01.04.2015 - Rs.9000 Lakhs) from HDFC Bank Ltd is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III.
The loan carries Interest at the rate of Bankâs Base rate plus 1% and repayable in 20 equal quarterly instalments starting from January 2016.
The loan amount repayable within twelve months is Rs 1800 lakhs (31.03.2016 - Rs.1800 Lakhs and 01.04.2015 - Rs.450 Lakhs) is grouped under Other Current Liabilities
2.2 Rupee term loan of Rs. 4950 Lakhs (31.03.2016 -Rs.6750 Lakhs and 01.04.2015 - Rs.8550 Lakhs) from State Bank of India is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III.
The loan carries Interest at the rate of Bankâs Base rate plus 1% and repayable in 20 equal quarterly instalments starting from March 2015.
The loan amount repayable within twelve months is Rs 1800 lakhs (31.03.2016 - Rs.1800 Lakhs and 01.04.2015 - Rs.1800 Lakhs ) is grouped under Other Current Liabilities.
2.3 Rupee term loan of Rs. 1500 Lakhs (31.03.2016 -Rs.1900 Lakhs and 01.04.2015 - Rs.2000 Lakhs) from The Federal Bank Ltd is secured by pari passu first charge on the movable plant and machinery of the Sugar and Co-generation Plant at Sugar Unit III.
The loan carries Interest at the rate of Bankâs Base rate plus 0.60% and repayable in 20 equal quarterly instalments starting from January 2016.
The loan amount repayable within twelve months is Rs 400 lakhs (31.03.2016 - Rs.400 Lakhs and 01.04.2015 - Rs.100 Lakhs) is grouped under Other Current Liabilities
2.4 Corporate loan of Rs. 7500 Lakhs (31.03.2016 -Rs.7500 Lakhs and 01.04.2015 - Rs. NIL) from State Bank of India is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II.
The loan carries Interest at the rate of Bankâs Base rate plus 1% and repayable in 16 equal quarterly instalments starting from December 2017.
The loan amount repayable within twelve months is Rs 937.50 Lakhs (31.03.201 6 -Rs. NIL and 01.04.2015 - Rs. NIL) is grouped under Other Current Liabilities.
2.5 Term loan of Rs. 4687.50 Lakhs (31.03.2016 -Rs.5000 Lakhs and 01.04.2015 - Rs. NIL ) from HDFC Bank Ltd is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II.
The loan carries Interest at the rate of Bankâs Base rate plus 1% and repayable in 16 equal quarterly instalments with moratorium of 12 months from the date of first availment.
The loan amount repayable within twelve months is Rs.1250 Lakhs (31.03.2016 - Rs. NIL and 01.04.2015 - Rs. NIL) is grouped under Other Current Liabilities.
2.6 Term loan of Rs. 10000 Lakhs (31.03.2016 -Rs.10000 Lakhs and 01.04.2015 - Rs. NIL) from ICICI Bank Ltd is secured by pari passu first charge on the fixed assets (excluding vehicles) of the Sugar Complex at Sugar Unit II.
The loan carries Interest at the rate of Bankâs Base rate plus 0.75% and repayable in 16 equal quarterly instalments with moratorium of 24 months from the date of first availment.
The loan amount repayable within twelve months is Rs.937.50 Lakhs (31.03.201 6 -Rs. NIL and 01.04.2015 - Rs. NIL) is grouped under Other Current Liabilities.
2.7 Loan from Sugar Development Fund (Government of India) availed for setting up of cogeneration plant in Sugar Unit-IV, amounting to Rs. 1442.09 Lakhs (31.03.2016 - Rs.1922.79 Lakhs and 01.04.2015 - Rs. 2403.48 Lakhs) is secured by way of first charge on the movable and immovable properties of Sugar Unit-IV and first pari passu charge on the movable and immovable properities of cogeneration plant in Sugar Unit IV.
The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. Repayment of principal commenced after the expiry of three years and in ten equal half yearly installments. The interest on the loan shall be paid half-yearly from the date of disbursement. The loan was disbursed during the financial year 2013.
The loan amount repayable within twelve months is Rs 480.70 lakhs (31.03.2016 - Rs.480.70 Lakhs and 01.04.2015 - Rs.480.70 Lakhs) is grouped under Other Current Liabilities.
2.8 Loan from Sugar Development Fund (Govt. of India) availed for implementation of the schemes aimed at development of sugar cane in the factory area of Sugar Unit-II, amounting to Rs. 371.25 Lakhs (31.03.2016 - Rs.472.50 Lakhs and 01.04.2015 - Rs. 540 Lakhs) is secured by way of exclusive second charge on the movable and immovable properties of Sugar Unit-II.
Repayment of principal commenced after the expiry of three years and in four equal annual installments. The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. The loan was disbursed in two intalments of Rs. 270 lakhs each.The interest on the first instalment of Rs.270 lakhs disbursed during the financial year 2013 is payable annually and the interest on the second instalment of Rs.270 lakhs disbursed during the financial year 2014 is payable half yearly from the date of disbursement.
The loan amount repayable within twelve months is Rs 135 lakhs (31.03.2016 - Rs.101.25 Lakhs and 01.04.2015 - Rs.67.50 Lakhs) is grouped under Other Current Liabilities.
2.9 Loan from Sugar Development Fund (Govt. of India) availed for modernisation cum expansion of Sugar Unit-III, amounting to Rs. 480.06 Lakhs (31.03.2016 - Rs. NIL and 01.04.2015 - Rs. NIL) is secured by way of pari passu first charge basis on the immovable and movable properties of Sugar Unit-III.
The loan carries interest at the rate of 2% below the bank rate prevailing on the date of disbursement. Repayment of principal and payment of interest thereon commenced after the expiry of one year of the repayment the bank term loan and interest thereon or on the expiry of a period of 5 years reckoned from the date of disbursement whichever is earlier.
2.10 Loan of Rs.5006.67 Lakhs (31.03.2016 -Rs.7556.67 Lakhs and 01.04.2015 - Rs.7840 Lakhs) under SEFASU notified by Government of India availed from Punjab National Bank, The HDFC Bank Ltd and Indian Overseas Bank is secured by residual third charge on all fixed assets forming part of block assets and land and buildings of Sugar Units I, II, III and IV
The loan availed from Punjab National Bank and HDFC Bank Ltd carries interest at the rate of 12% per annum and loan availed from Indian Overseas Bank carries interest at the rate of Bankâs base rate plus 0.50%. The loan is eligible interest subvention upto 12% and is repayable in 36 equal monthly installments after the expiry of 2 years from the date of disbursement.
The loan amount repayable within twelve months is Rs 2620 lakhs (31.03.2016 - Rs.2620 Lakhs and 01.04.2015 - Rs.218.33 Lakhs) is grouped under Other Current Liabilities.
2.11 Loan of Rs.783.66 Lakhs (31.03.2016 -Rs.1127.99 Lakhs and 01.04.2015 - Rs. NIL) under SEFASU notified by Government of India availed from Central Bank of India and The Karur Vysya Bank Ltd is secured by residual first charge on all fixed assets Sugar Units V.
The loan availed from Central Bank of India carries interest at the rate of 12% per annum and loan availed from The Karur Vysya Bank Ltd carries interest at the rate of Bankâs base rate plus 0.50%. The loan is eligible interest subvention upto 12% and is repayable in 36 equal monthly installments after the expiry of 2 years from the date of disbursement.
The loan amount repayable within twelve months is Rs.376 Lakhs (31.03.2016 - Rs.344.33 Lakhs and 01.04.2015 - Rs. NIL) is grouped under Other Current Liabilities.
2.12 Loan of Rs.3282.50 Lakhs (31.03.2016 - Rs.4250 Lakhs and 01.04.2015 - Rs.NIL) under SOFT LOAN notified by Government of India availed from The DFC Bank Ltd and Union Bank of India is secured by residual third charge on all fixed assets forming part of block assets and land and buildings of Sugar Units I, II, III and IV.
The loan availed from HDFC Bank Ltd carries interest at the rate of 10% per annum for the first twelve months and at HDFC bank rate for the second and third year of loan or subject to change as per Goverment/Reserve Bank of India. The loan availed from Union Bank of India carries interest at the rate of Bankâs base. The loan availed from HDFC Bank Ltd is repayable in 8 equal quarterly instalments after expiry of one year from the date of first disbursement. The loan availed from Union Bank of India is repayable in 16 equal quarterly instalements after expiry of one year. The loan is eligible interest subvention.
The loan amount repayable within twelve months is Rs 1745 lakhs (31.03.2016 - Rs.1308.75 Lakhs and 01.04.2015 - Rs.NIL) is grouped under Other Current Liabilities.
2.13 The interest free loan availed by Madras Sugars Limited from a related party is repayable as specified in the scheme of Amalgamation and the same will continue to be interest free loan until repayment.
2.14 The purchase tax of Rs. 164.32 lakhs payable to Government of Karnataka for purchase of Sugarcane to sugar Unit III during the Year eneded 31.03.2015 has been converted into interest free loan. The loan is secured by issue of Bank Guarentee from ICICI Bank Limited. The loan is payable in five annual instalments from the sixth year of Conversion into Loan.
3.1 Cash Credit and other Working Capital Limits/ Demand Loan sanctioned by Punjab National Bank consortium consists of Punjab National Bank, Bank of Baroda, Canara Bank, The Federal Bank Ltd, The Karur Vysya Bank Ltd, Union Bank of India, Indian Overseas Bank, State Bank of Travancore, State Bank of India, State Bank of Hyderabad, Bank of India, Axis bank Ltd, ICICI Bank Ltd and The HDFC Bank Ltd to the companyâs Sugar Units I, II, III and IV are secured by way of hypothecation of current assets and other movable block assets of the sugar units and third mortgage on the immovable properties of the Sugar units I, II, III and IV.
The credit limit availed as at 31.3.2017 is Rs. 18522.33 Lakhs (31.03.2016 - Rs.43961.29 Lakhs and 01.04.2015 - Rs.56945.04 Lakhs)
The availed limits are repayable on demand and carries interest rates between Bankâs base rate plus 0.25% and 1% per annum.
3.2 The Unsecured Short term loan of Rs.10000 lakhs from HDFC Bank Ltd is repayable within ninety days from the date of availment and carries interest at the rate of 7.90% per annum.
The Unsecured short term factoring facility for domestic receivable / sales invoice discount facility of Rs. 711.66 lakhs from Axis Bank Ltd is repayable within ninety days from the date of availment and carries interest at the rate of 8.15% per annum.
The Unsecured short term vender financing / purchase invoice discounting facility of Rs. 1316.89 lakhs from Axis Bank Ltd is repayable within one hundred and twenty days from the date of availment and carries interest at the rate of 8.25% per annum.
The Unsecured short term farmer finance loan of Rs. 5418.41 lakhs from HDFC Bank Ltd is repayable within one hundred and eighty days from the date of availment and carries interest at 8% per annum.
The Unsecured Shot term FCNRB loan of Rs. 5000 lakhs from HDFC Bank Ltd is repayable within one hundred and eighty days from the date of availment and carries interest at LIBOR plus 200 basis points
The other unsecured loan of Rs.5000 lakhs availed by M/s Madras Sugars Limited from the related parties will be repaid as specified in the scheme of amalgamation
NOTE 4. TRADE PAYABLES
The vendors of the Company are yet to submit their status under Micro, Small and Medium Enterprises; hence the relevant information is not available with the company. Accordingly no disclosures relating to Micro, Small and Medium Enterprises have been made in the accounts.
5. CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided for)
Contingent liabilities
5.1 The company has preferred a Writ Appeal before the Division Bench of the Honâble High Court, Madras challenging the Order pronounced in Writ Petition No. 4030/2002 dated 28.02.2006 in connection with increase in rate of water charges and the method of computation of water charges pursuant to the G.O. No.474 dated 13.11.2001 for the water drawn for industrial purposes. The approximate amount under dispute is Rs.408.14 Lakhs (31.03.201 6 -Rs.397.94 Lakhs and 01.04.2015 -Rs.387.76 Lakhs)
5.2. Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the sugar production as Free Sugar for a period of 8 years from 1985-86 Sugar Season. Chief Director (Sugar), Directorate of Sugar Department of Food New Delhi has restricted the entitlement of Free sale Sugar Incentive to 275000 quintals production per season by a subsequent notification. A Writ Petition has been filed in the Madras High Court Challenging the restriction imposed and interim injunction has been obtained. By virtue of injunction order the entire production was sold as Free Sugar. The approximate unprovided quantum under dispute is Rs. 683.35 Lakhs (31.03.2016 -Rs.683.35 Lakhs and 01.04.2015 -Rs.683.35 Lakhs).
5.3. Sugar Unit-I at Sathyamangalam was allowed to sell 100% of the Sugar production as free sugar for a period of 8 years from 1985-86 sugar season and pay excise duty on incentive sugar as applicable to levy sugar and to retain the difference in excise duty between levy and free sale sugar. In respect of incentive sugar sold by Unit-I from 20.09.1991 to 31.01.1994, the Central Excise Department has issued show cause notices to the Company to show cause why the difference of Rs.33/- per quintal being the difference between duty on levy sugar and free sugar should not be demanded from the Company. The Company has filed Writ Petitions in Madras High Court and the Honâble High Court disposed the case with direction to submit all explanations before the adjudicating authority. Now the matter is pending before the adjudicating authority The excise duty in dispute is Rs.1 49.99 Lakhs (31.03.2016 - Rs.149.99 Lakhs and 01.04.2015 - Rs.149.99 Lakhs).
5.4. The Entry Tax of Rs. 188.29 lakhs on Inter-state purchase of rough blocks is disputed (31.03.2016 - Rs.188.29 Lakhs and 01.04.2015 - Rs.188.29 Lakhs).
5.5. The Company has received a demand for payment of excise duty for Rs.148.44 (31.03.2016 - Rs.148.44 Lakhs and 01.04.2015 - Rs.148.44 Lakhs). lakhs on the machineries purchased for cogeneration plant which have been cleared by the manufacturers based on the certificates alleged to have been forged by an Official in the Ministry of Finance. The Company has remitted the amount under protest. The company opted for obtaining a valid certificate for which steps have been taken through a writ petition filed in Honâble High Court of Madras.
5.6. The company has preferred an appeal before the Commissioner of Income Tax (Appeals) challenging the order of Assistant Commissioner of Income Tax in connection with disallowance of deduction for the Assessment year 2013-14. The quantum under dispute is Rs.1.60 Lakhs.
5.7. As at the year end, the Company has an obligation under EPCG Scheme to export sugar of a value of USD 93,28,827. (31.03.2016 - USD 93,28,827 and 01.04.2015 - USD 1,03,17,105).
5.8. Estimated amount of contracts remaining to be executed on capital account - Tangible Assets not provided for is Rs.461.72 Lakhs (31.03.2016 -Rs.174.38 Lakhs and 01.04.2015 -Rs.155.10 Lakhs).
The above remuneration does not include gratuity and leave encashment benefit, since the same is computed actuarially for all the employees and the amount attributable to the managerial person cannot be ascertained separately.
6. Segment Information for the year ended 31st March 2017
Information reported to the chief operating decision maker (C.O.D.M.) for the purpose of resource allocation and assessment of segment performance focuses on the types of goods or services delivered or provided, and in respect of the following segment tabulated below . Business segments are primarily Sugar, Power, Distillery and Granite products. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment/manpower efforts. Income or Expenses which are not attributable or allocable to segments have been disclosed as unallocable Income / Expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. Geographical revenues are allocated based on the location of the customer.
7 Related Party disclosures as required under Indian Accounting Standard on âRelated Party Disclosuresâ issued by the Institute of Chartered Accountants of India are given below
1 KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam, Chairman Sri B Saravanan, Managing Director
2 RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam Relatives
Sri B Saravanan (Son)
Sri B Saravanan Relatives
Sri S V Balasubramaniam (Father)
3 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
1 Annamallai Enterprise Private Limited
2 Bannari Amman Exports Private Limited
3 Shiva Cargo Movers Private Limited
4 Shiva Distilleries Private Limited
5 SVB Holdings Private Private Limited
8 Previous yearâs figures have been regrouped / reclassified wherever necessary to correspond with the current yearâs classification / disclosure
9 Foreign currency exposures that are hedged by a derivative instrument or natural hedging are as under :-
10. The dividend is paid to Non Resident shareholders in Indian Rupee by crediting to their Rupee Bank account
11. During the year the company had Specified Bank Notes (SBN) or other denomination notes as defined in the MCA notification G.S.R 308 (E) dated 30.3.2017 on the details of SBN held and transacted during the period from 8.11.2016 to 30.12.2016 are as under :
12. Financial Instruments : Capital Management
The Company manages its capital to ensure that the company will be able to continue as going concern by maximizing the return to stakeholders through the optimization of the debt and equity balance. The Capital structure of the company consist of net debt (as mentioned in Note 13,16 & 18 off set by cash and bank balances) and total equity of the company. The company is not subject to any externally imposed capital requirements.
Financial risk management objectives and policies :
The Companyâs financial risk management is an integral part of how to plan and execute its business strategies. The Companyâs financial risk management policy is set by the Managing Board.
The Companyâs corporate treasury function provides services to the business co-ordinates access to financial markets and manages financial risks relating to the operation of the company through internal risk reports which analyze exposures by degree and magnitude of risk. These risks include market risk (including currency risk, interest risk), credit and liquidity risk. The use of financial derivatives is governed by the Companyâs policies approved by Board of Directors. The company does not enter into or trade financial instruments, including derivatives instruments for speculative purposes.
The Market Risk - Currency risk is mitigated through forward contracts and natural hedging.
Market risk - Interest Rate risk is managed maintaining a combination of fixed and floating rate debt and cash management policies. There is no material interest risk to the companyâs financial liabilities.
Credit Risk Management - refers to the risk that the customerâs ability to meet the contractual obligation. The company manages the risk by credit approval, monitoring process and adequate insurance coverage.
Liquidity Risk Management - refers to the fluctuation in cash flows; the same is managed by preparing and monitoring the forecast of cash flows, cash management policies by matching the maturity profiles of financial assets and liabilities.
All current financial liabilities are repayable within 1 year. The company covering its currency exposure under forward cover/ natural hedging, and hence sensitive analysis is not required.
The tax rate used for the years 2015-16 and 2016-17 reconciliation above is the corporate tax rate of 34.608% (30% surcharge @ 12% and education cess @ 3%) payable on taxable profits under the Income Tax Act, 1961.
13. Events occurring after Balance Sheet date.
The Board of Directors has recommended equity dividend of Rs. 12.50 per share (Previous year Rs.7.50 per share) for the financial year 2016-17.
Mar 31, 2016
1 CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided for)
Contingent liabilities
2 The company has preferred a Writ Appeal before the Division Bench of the Hon''ble High Court, Madras challenging the Order pronounced in Writ Petition No 4030/2002 dated 28.02.2006 in connection with increase in rate of water charges and the method of computation of water charges pursuant to the G O No 474 dated 13.11.2001 for the water drawn for industrial purposes The approximate amount under dispute is Rs 397.94 Lakhs (Rs 387.76 Lakhs)
3 Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the sugar production as Free Sugar for a period of 8 years from 1985-86 Sugar Season Chief Director (Sugar) Directorate of Sugar Department of Food New Delhi has restricted the entitlement of Free sale Sugar Incentive to 275000 quintals production per season by a subsequent notification A Writ Petition has been filed in the Madras High Court Challenging the restriction imposed and interim injunction has been obtained By virtue of injunction order the entire production was sold as Free Sugar The approximate unprovoked quantum under dispute is Rs 683.35 Lakhs
4 Sugar Unit-I at Sathyamangalam was allowed to sell 100% of the Sugar production as free sugar for a period of 8 years from 1985-86 sugar season and pay excise duty on incentive sugar as applicable to levy sugar and to retain the difference in excise duty between levy and free sale sugar In respect of incentive sugar sold by Unit-I from 20.09.1991 to 31.01.1994 the Central Excise Department has issued show cause notices to the Company to show cause why the difference of Rs 33/- per quintal being the difference between duty on levy sugar and free sugar should not be demanded from the Company The Company has filed Writ Petitions in Madras High Court and the Hon''ble High Court disposed the case with direction to submit all explanations before the adjudicating authority Now the matter is pending before the adjudicating authority The excise duty in dispute is Rs 149.99 lakhs
5 The Entry Tax of Rs 188.29 lakhs on Inter-state purchase of rough blocks is disputed
6 The Company has received a demand for payment of excise duty for Rs148.44 lakhs on the machineries purchased for co-generation plant which have been cleared by the manufacturers based on the certificates alleged to have been forged by an Official in the Ministry of Finance The Company has remitted the amount under protest The company opted for obtaining a valid certificate for which steps have been taken through a writ petition filed in Hon''ble High Court of Madras
7 The company has preferred an appeal before the Commissioner of Income Tax (Appeals) challenging the order of Assistant Commissioner of Income Tax in connection with disallowance of deduction for the Assessment year 2012-13 The quantum under dispute is Rs 1579.62 Lakhs
8 As at the year end The Company has an obligation under EPCG Scheme to export sugar of a value of USD 93,28,827
9 Estimated amount of contracts remaining to be executed on capital account - Tangible Assets not provided for is Rs 174.38 Lakhs (Rs 155.10 lakhs)
10 Segment Information for the year ended 31st March 2016
The Company has identified business segments as its primary segment and geographic segments as its secondary segment. Business segments are primarily Sugar Power Distillery and Granite products Revenues and expenses directly attributable to segments are reported under each reportable segment Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment/manpower efforts Income or Expenses which are not attributable or allocable to segments have been disclosed as unallowable Income / Expenses Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment Geographical revenues are allocated based on the location of the customer
11 RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam
Relatives
Sri B Saravanan (Son)
Sri B Saravanan Relatives
Sri S V Balasubramaniam (Father)
12 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
Annamallai Enterprise Private Limited
Bannari Amman Exports Private Limited
Shiva Cargo Movers Private Limited
Shiva Distilleries Private Limited
SVB Holdings Private Private Limited
13. Disclosure pursuant to Accounting Standard 28 (AS 28) on Impairment of assets - During the year the company had reviewed the carrying value of assets for finding out impairment if any The review has revealed that there is no impairment as per Accounting Standard 28
14. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure
Mar 31, 2015
1. Terms / rights attached to equity shares
The company has issued only one class of equity shares having face
value of Rs10/- each One equity share carries one vote The members are
entitled to vote in accordance with their shareholding The Company
declares and pays dividend in Indian rupees The dividend recommended by
the Board of Directors is subject to the approval of the shareholders
in the ensuing Annual General Meeting
2. Rupee term loan of Rs 9000 lakhs (Rs 6800 lakhs) from HDFC Bank Ltd
is secured by pari passu first charge on the land & building and
movable plant and machinery of the Sugar and Co-generation Plant at
Sugar Unit III
The loan carries interest at the rate of Bank's Base rate plus 1% and
repayable in 20 equal quarterly instalments starting from January 2016
The loan amount repayable within twelve months is Rs 450 lakhs (Nil)
grouped under Other Current Liabilities
3. Rupee term loan of Rs 8550 Lakhs (Rs 7100 Lakhs) from State Bank of
India is secured by pari passu first charge on the land & building and
movable plant and machinery of the Sugar and Co-generation Plant at
Sugar Unit III
The loan carries Interest at the rate of Bank's Base rate plus 1% and
repayable in 20 equal quarterly instalment starting from March 2015
The loan amount repayable within twelve months is Rs 1800 lakhs (Rs 400
Lakhs) grouped under Other Current Liabilities
4. Rupee term loan of Rs 2000 Lakhs (Rs 2000 Lakhs) from The Federal
Bank Ltd is secured by pari passu first charge on the land & building
and movable plant and machinery of the Sugar and Co-generation Plant at
Sugar Unit III
The loan carries Interest at the rate of Bank's Base rate plus 0.60%
and repayable in 20 equal quarterly instalments starting from January
2016
The loan amount repayable within twelve months is Rs 100 lakhs (Nil)
grouped under Other Current Liabilities
5. Loan from Sugar Development Fund (Government of India) availed for
setting up of co-generation plant in Sugar Unit-IV amounting to Rs
2403.48 Lakhs (Rs 2403.48 lakhs) is secured by way of first charge on
the movable and immovable properties of Sugar Unit IV and first pari
passu charge on the movable and immovable properties of co-generation
plant in Sugar Unit IV
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement Repayment of principal commenced
after the expiry of three years and in ten equal half yearly
installments The interest on the loan shall be paid half-yearly from
the date of disbursement The loan was disbursed during the financial
year 2013
The loan amount repayable within twelve months is Rs 480. 70 lakhs
(Nil) grouped under Other Current Liabilities
6. Loan from Sugar Development Fund (Government of India) availed for
implementation of the schemes aimed at development of sugar cane in the
factory area of Sugar Unit-II amounting to Rs 540 Lakhs (Rs 540 lakhs)
is secured by way of exclusive second charge on the movable and
immovable properties of Sugar Unit-II
Repayment of principal commenced after the expiry of three years and in
four equal annual installments The loan carries interest at the rate of
2% below the bank rate prevailing on the date of disbursement The loan
was disbursed in two instalments of Rs 270 lakhs each The interest on
the first instalment of Rs 270 lakhs disbursed during the financial year
2013 is payable annually and the interest on the second instalment of Rs
270 lakhs disbursed during the financial year 2014 is payable half
yearly from the date of disbursement
The loan amount repayable within twelve months is Rs 67. 50 lakhs (Nil)
grouped under Other Current Liabilities
7. Loan of Rs 7840 Lakhs (Rs 5811.58 Lakhs) under SEFASU notified by
Government of India availed from Punjab National Bank HDFC Bank Ltd and
Indian Overseas Bank is secured by residual third charge on all fixed
assets forming part of block assets and land and buildings of Sugar
Units I, II, III and IV
The loan availed from Punjab National Bank and HDFC Bank Ltd carries
interest at the rate of 12% per annum and loan availed from Indian
Overseas Bank carries interest at the rate of Bank's base rate plus
0.50% The loan is eligible interest subvention upto 12% and is
repayable in 36 equal monthly instalments after the expiry of 2 years
from the date of disbursement
The loan amount repayable within twelve months is Rs 218. 33 lakhs
(Nil) grouped under Other Current Liabilities
8. Cash Credit and other Working Capital Limits /Demand Loan
sanctioned by Punjab National Bank consortium consists of Punjab
National Bank Bank of Baroda Canara Bank The Federal Bank Ltd The Karur
Vysya Bank Ltd Union Bank of India Indian Overseas Bank State Bank of
Travancore State Bank of India State Bank of Hyderabad Bank of India
Axis bank Ltd ICICI Bank Ltd and HDFC Bank Ltd to the company's Sugar
Units are secured by way of hypothecation of current assets and other
movable block assets of the sugar units and third mortgage on the
immovable properties of the Sugar units
The credit limit availed as at 31.3.2015 is Rs 56945.04 Lakhs (Rs
48967.42 Lakhs)
The availed limits are repayable on demand and carries interest rates
between Bank 's base rate plus 0.25% and 1% per annum
9. Packing Credit Limit and other working capital limits sanctioned by
Punjab National Bank and State Bank of India to Granite Division are
secured by way of hypothecation of current assets and second mortgage
on other movable and immovable properties of Granite Division
The credit limit availed as at 31.3.2015 is Rs 500 Lakhs (Rs 500 Lakhs)
The credit limits availed are repayable on demand and carries interest
at the rate of banks base rate plus 0.25% per annum
10. Cash Credit Limits sanctioned by Canara Bank and The Lakshmi Vilas
Bank Ltd to Distillery Unit at Tamilnadu are secured by way of
Hypothecation of current assets and second charge on other movable and
immovable properties of the Distillery Unit in Tamilnadu
The credit limit availed as at 31.3.2015 is Rs 247.60 Lakhs (Rs 148.28
Lakhs)
The cash credit limits are repayable on demand and carries interest
ranges between Bank's base rate plus 0.30% and 1.25% per annum
The Unsecured Short Term loan of Rs 5000 lakhs from HDFC Bank Ltd is
repayable within one hundred and eighty days from the date of availment
and carries interest at the rate of 10% per annum
The Unsecured Short Term loan of Rs 10000 lakhs from HDFC Bank Ltd is
repayable within ninety days from the date of availment and carries
interest at the rate of 10% per annum
The Unsecured Short Term Export Credit facility of Rs 2000 lakhs from
HDFC Bank Ltd is repayable within ninety days from the date of
availment and carries interest at the rate of 10% per annum
The Unsecured Short Term Vendor Financing/Purchase Invoice Discounting
facility of Rs 2500 lakhs from Axis Bank Ltd is repayable within one
hundred and twenty days from the date of availment and carries interest
at the rate of 10.25% per annum
11. The Unsecured Short Term Factoring Facility for domestic
receivables of Rs 2500 lakhs from Axis Bank Ltd is repayable within
ninety days from the date of availment and carries interest at the rate
of 10.50% per annum
The Unsecured Short Term Loan of Rs 4649.97 lakhs from Canara Bank is
repayable in four monthly equal instalments commencing from fifth month
from the date of availment and carries interest at the rate of 10.25%
per annum
12. CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided
for)
Contingent liabilities
1 The company has preferred a Writ Appeal before the Division Bench
of the Hon'ble High Court Madras challenging the Order dated 28.02.2006
in Writ Petition No 4030/2002 in connection with increase in rate of
water charges and the method of computation of water charges The
approximate amount under dispute is Rs 387.76 Lakhs (Rs 377.55 Lakhs)
2 Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the
sugar production as Free Sugar for a period of 8 years from 1985-86
Sugar Season Chief Director (Sugar) Directorate of Sugar Department of
Food New Delhi has restricted the entitlement of Free sale Sugar
Incentive to 275000 quintals production per season by a subsequent
notification A Writ Petition has been filed in the Madras High Court
Challenging the restriction imposed and interim Injunction has been
obtained By virtue of injunction order the entire production was sold
as Free Sugar The approximate unprovided quantum under dispute is Rs
683.35 Lakhs
3 Sugar Unit-I at Sathyamangalam was allowed to sell 100% of the
Sugar production as free sugar for a period of 8 years from 1985-86
sugar season and pay excise duty on incentive sugar as applicable to
levy sugar and to retain the difference in excise duty between levy and
free sale sugar In respect of incentive sugar sold by Unit-I from
20.09.1991to 31.01.1994 the Central Excise Department has issued show
cause notices to the Company to show cause why the difference of Rs
33/- per quintal being the difference between duty on levy sugar and
free sugar should not be demanded from the Company The Company has
filed Writ Petitions in Madras High Court and the Hon'ble High Court
disposed the case with direction to submit all explanations before the
adjudicating authority Now the matter is pending before the
adjudicating authority The excise duty in dispute is Rs149.99 lakhs
4 The Entry Tax of Rs 188.29 lakhs on Inter-state purchase of rough
blocks is disputed
5 The Company has received a demand for payment of excise duty for
Rs148.44 lakhs on the machineries purchased for co-generation plant
which have been cleared by the manufacturers based on the certificates
alleged to have been forged by an Official in the Ministry of Finance
The Company has remitted the amount under protest The company opted for
obtaining a valid certificate for which steps have been taken through a
writ petition filed in Hon'ble High Court of Madras
6 The Company has been asked to pay Electricity Tax of 10 Paise per
unit with effect from 16th June 2003 for the electricity consumed from
own captive power generators at its sugar factories in Tamilnadu under
Tamilnadu Tax on Consumption or Sale of Electricity Act 2003 which has
been disputed by filing a Writ petition before the Hon'ble High Court
of Madras The approximate quantum under dispute is Rs 1546.23 Lakhs
(Rs1412.06)
7 The company has preferred an appeal before the Commissioner of
Income Tax (Appeals) challenging the order of Assistant Commissioner of
Income Tax in connection with disallowance of deduction for the
Assessment year 2012 -13 The quantum under dispute is Rs1579.62 Lakhs
8 As at the year end the Company has an obligation under EPCG Scheme
to export sugar of a value of USD 10317105
9 Estimated amount of contracts remaining to be executed on capital
account-Tangible Assets not provided for is Rs155.10 Lakhs (Rs 3195.75
lakhs)
13. Related Party disclosures as required under Accounting Standard on
"Related Party Disclosures" issued by the Institute of Chartered
Accountants of India are given below
1. KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam Chairman Sri B Saravanan Managing Director
2. RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam
Relatives
Sri B Saravanan (Son)
Sri B Saravanan
Relatives
Sri S V Balasubramaniam (Father)
3. ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES
ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
Annamallai Enterprise Limited
Annamallai Retreading Company (P) Limited
Bannari Amman Exports Limited
Madras Sugars Limited
Sakthi Murugan Transports Limited
Shiva Cargo Movers Limited
Shiva Distilleries Limited
14. Disclosure pursuant to Accounting Standard 28 (AS 28) on Impairment
of assets During the year the company had reviewed the carrying value
of assets for finding out impairment if any The review has revealed
that there is no impairment as per Accounting Standard 28
15. Previous year's figures have been regrouped / reclassified wherever
necessary to correspond with the current year's classification /
disclosure
16. The annual increase in the rate of power charges for supplies made
from 20 MW Cogeneration plant at Alathukombai Village Sathyamangalam
Taluk Erode District Tamilnadu to Tamilnadu Electricity Board as
prescribed in the Power Purchase Agreement entered has not been
provided in the books considering the uncertainty in the realisation of
the same
17. As at 31st March 2015 the company has Derivative Contracts in the
nature of Forward Contract for USD 3298880 towards hedging the export
receivables and there are no Derivative Contracts for speculation
Mar 31, 2014
1 CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided
for) Contingent liabilities
1.1 The company has preferred a Writ Appeal before the Division Bench
of the Hon''ble High Court Madras challenging the Order pronounced in
Writ Petition No 4030/2002 dated 28.02.2006 in connection with increase
in rate of water charges and the method of computation of water charges
pursuant to the G O No 474 dated 13.11.2001 for the water drawn for
industrial purposes The approximate amount under dispute is Rs 377.55
lakhs (Rs 368.98 lakhs)
1.2 Sugar Unit I at Sathyamangalam was permitted to sell 100% of the
sugar production as Free Sugar for a period of 8 years from 1985-86
sugar season Chief Director (Sugar) Directorate of Sugar Department of
Food New Delhi has restricted the entitlement of Free sale Sugar
Incentive to 275000 quintals production per season by a subsequent
notification A Writ Petition has been filed in the Madras High Court
Challenging the restriction imposed and interim injunction has been
obtained By virtue of injunction order the entire production was sold
as Free Sugar The approximate unprovided quantum under dispute is Rs
683.35 lakhs (Rs 683.35 lakhs)
1.3 Sugar Unit I at Sathyamangalam was allowed to sell 100% of the
Sugar production as free sugar for a period of 8 years from 1985-86
sugar season and pay excise duty on incentive sugar as applicable to
levy sugar and to retain the difference in excise duty between levy and
free sale sugar In respect of incentive sugar sold by Unit I from
20.09.1991 to 31.01.1994 the Central Excise Department has issued show
cause notices to the Company to show cause why the difference of Rs
33/- per quintal being the difference between duty on levy sugar and
free sugar should not be demanded from the Company The Company has
filed Writ Petitions in Madras High Court and the High Court disposed
the case with direction to submit all explanations before the
adjudicating authority Now the matter is pending before the
adjudicating authority The excise duty in dispute is Rs 149.99 lakhs
(Rs 149.99 lakhs)
1.4 The entry tax of Rs 188.29 lakhs (Rs 188.29 lakhs) on inter-state
purchase of rough blocks is disputed
1.5 The Company has received a demand for payment of excise duty for
Rs 148.43 lakhs on the machineries purchased for co-generation plant
which have been cleared by the manufacturers based on the certificates
alleged to have been forged by an Official in the Ministry of Finance
The Company has remitted the amount under protest The company opted for
obtaining a valid certificate for which steps have been taken through a
writ petition filed in Hon''ble High Court of Madras
1.6 The company has preferred an appeal before the Commissioner of
Income Tax (Appeals) challenging the order of Assistant Commissioner of
Income Tax in connection with disallowance of deduction for the
Assessment years 2007 - 08 and 2011 - 12 The quantum under dispute is
Rs 345.73 lakhs
1.7 As at the year end The Company has an obligation under EPCG Scheme
to export sugar of a value of USD 10317105
1.8 Estimated amount of contracts remaining to be executed on capital
account - Tangible Assets not provided for is Rs 3195.75 lakhs (Rs
13789.42 lakhs)
2 Segment Information for the year ended 31st March 2014
The Company has identified business segments as its primary segment and
geographic segments as its secondary segment Business segments are
primarily Sugar Power Distillery and Granite Products Revenues and
expenses directly attributable to segments are reported under each
reportable segment Expenses which are not directly identifiable to each
reportable segment have been allocated on the basis of associated
revenues of the segment/manpower efforts Income or Expenses which are
not attributable or allocable to segments have been disclosed as
unallocable Income / Expenses Assets and liabilities that are directly
attributable or allocable to segments are disclosed under each
reportable segment Geographical revenues are allocated based on the
location of the customer
3 Related Party disclosures as required under Accounting Standard on
"Related Party Disclosures" issued by the Institute of Chartered
Accountants of India are given below
1 KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam Chairman
Sri B Saravanan Managing Director
2 RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam Relatives
Sri B Saravanan (Son)
Sri B Saravanan Relatives
Sri S V Balasubramaniam (Father)
3 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES
ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
Annamallai Enterprise Limited
Bannari Amman Exports Limited
Madras Sugars Limited
Shiva Cargo Movers Limited
Shiva Distilleries Limited
4 Disclosure pursuant to Accounting Standard 28 (AS 28) on Impairment
of assets During the year the company had reviewed the carrying value
of assets for finding out impairment if any The review has revealed
that there is no impairment as per Accounting Standard 28
5 Previous year''s figures have been regrouped / reclassified wherever
necessary to correspond with the current year''s classification /
disclosure
6 The annual increase in the rate of power charges for supplies made
from 20 MW Cogeneration plant at Alathukombai Village Sathyamangalam
Taluk Erode District Tamilnadu to Tamilnadu Electricity Board as
prescribed in the Power Purchase Agreement entered has not been
provided in the books considering the uncertainty in the realisation of
the same
7 There are no derivative financial instruments either for hedging or
for speculation outstanding as at the Balance Sheet date
8 The dividend is paid to Non Resident shareholders in Indian Rupee by
crediting to their Rupee Bank account
Mar 31, 2013
1.1 Rupee term loan of Rs. 2800 Lakhs (Rs.4200 Lakhs) from Axis Bank
Ltd is secured by pari passu charge on the movable plant and machinery
and pari passu second charge on the current assets of the Co-generation
Plant at Sugar Unit IV The loan is further secured by mortgage on lands
admeasuring 50.93 acres and buildings thereon pertaining to the
Co-generation Plant at Sugar Unit-IV
The loan carries interest at the rate of Bank''s Base rate plus 2.25%
and repayable in 20 equal quarterly instalments of Rs.350 Lakhs each
starting from June 2010
Out of the above loan amount repayable within twelve months is Rs. 1400
lakhs (Rs.1400 Lakhs) is grouped under other current liabilities
1.2 The two years Corporate Loan of Rs.1875 lakhs (Rs.5625 lakhs) from
Canara Bank is against assignment of receivables from Electricity Board
(free from encumbrance) The loan carries interest at the rate of Bank''s
Base rate plus 1% and repayable in 24 equal monthly instalments of
Rs.312.50 Lakhs each starting from October 2011 Out of the above loan
amount repayable within twelve months is Rs. 1875 lakhs (Rs.3750 lakhs)
which is grouped under other current liabilities
1.3 Loan from Sugar Development Fund (Government of India) availed for
modernisation/expansion of Sugar Unit I amounting to Rs. 465.23 Lakhs
(Rs. 775.39 Lakhs) is secured by way of xclusive second charge on the
movable and immovable properties of Sugar Unit I
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement Repayment of principal and
interest thereon commenced after a period of 8 years from the date of
disbursement and in five equal annual instalments The loan was
disbursed during the financial year 2002 Out of the above loan amount
repayable within twelve months is Rs. 310.16 lakhs (Rs. 310.16 lakhs)
which is grouped under other current Liabilities
1.4 Loan from Sugar Development Fund (Government of India) availed for
co-generation plant in Sugar Unit IV amounting to Rs. 2403.48 Lakhs (Nil)
is secured by way of first charge on the movable and immovable
properties of Sugar Unit IV and first pari passu charge on the movable
and immovable properties of co-generation plant in Sugar Unit IV
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement Repayment of principal commenced
after the expiry of three years and in ten equal half yearly
instalments The interest on the Loan shall be paid half yearly from the
date of disbursement The Loan was disbursed during the financial year
2013
1.5 Loan from Sugar Development Fund (Government of India) availed for
implementation of the schemes aimed at development of sugar cane in the
factory area of Sugar Unit-II amounting to Rs.270 Lakhs (Nil) is
secured by way of exclusive second charge on the movable and immovable
properties of Sugar Unit II
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement Repayment of principal commenced
after the expiry of three years and in four equal annual instalmmmmm
The interest on the Loan shall be paid annually from the date of
disbursement The loan was disbursed during the financial year 2013
1.6 Loan from Sugar Development Fund (Government of India) availed for
implementation of the schemes aimed at development of sugar cane in the
factory area of Sugar Unit III amounting to Rs.266.40 Lakhs (Nil) is
secured by way of exclusive second charge on the movable and immovable
properties of Sugar Unit III
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement Repayment of principal commenced
after the expiry of three years and in four equal annual instalments
The interest on the Loan shall be paid annually from the date of
disbursement The loan was disbursed during the financial year 2013
1.7 Term Loan of Rs.38.83 Lakhs (Rs.136.84 Lakhs) under SEFASU notified
by Government of India availed from Punjab
National Bank consortium consists of Punjab National Bank Bank of
Baroda Canara Bank The Karur Vysya Bank Ltd Union Bank of India Indian
Overseas Bank State Bank of Travancore State Bank of India State Bank
of Hyderabad & Bank of India is secured by residual third charge on all
fixed assets forming part of block assets and land and buildings of
Sugar Units I II and III
The loan carries interest subvention at the rate of 12% per annum and
is repayable in 24 equal instalments after the expiry of 2 years from
the date of disbursement
The loan amount repayable within twelve months is Rs. 38.83 Lakhs
(Rs.136.84 Lakhs) is grouped under Other Current Liabilities
2.1 Cash Credit and other Working Capital Limits/ Demand Loan
sanctioned by Punjab National Bank consortium consists of Punjab
National Bank Bank of Baroda Canara Bank The Federal Bank Limited The
Karur Vysya Bank Limited Union Bank of India Indian Overseas Bank State
Bank of Travancore State Bank of India State Bank of Hyderabad Bank of
India Axis Bank Limited ICICI Bank Limited and HDFC Bank Limited to the
Company''s Sugar Units are secured by way of hypothecation of current
assets and other movable block assets of the Sugar Units and third
mortgage on the immovable properties of the Sugar Units
The credit limits availed as at 31.3.2013 is Rs. 29642.38 Lakhs (Rs.
19810.30 Lakhs)
The availed limits are repayable on demand and carries interest ranges
between Bank''s base rate plus 0.25% and 1.75% per annum
2.2 Packing Credit Limit and other working capital limits sanctioned by
Punjab National Bank and State Bank of India to Granite Division are
secured by way of hypothecation of current assets and second mortgage
on other movable and immovable properties of Granite Division
The credit limits availed as at 31.3.2013 is Nil (Nil)
The credit limits availed are repayable on demand and carries interest
ranges between Bank''s Base Rate plus 0.75% and 1.50% per annum
2.3 Cash Credit Limits sanctioned by Canara Bank and The Lakshmi Vilas
Bank Ltd to Distillery Unit in Tamilnadu are secured by way of
Hypothecation of current assets and second charge on other movable and
immovable properties of the Distillery Unit in Tamilnadu
The credit limits availed as at 31.3.2013 is Rs. 119.70 Lakhs (Rs.
148.39 Lakhs)
The cash credit limits are repayable on demand and carries interest
ranges between Bank''s base rate plus 0.50% and 2.75% per annum
2.4 The Unsecured Short term loan of Rs. 2000 lakhs (Nil) of availment
and carries interest at the rate of 10.45% per annum The Unsecured
Short term loan of Rs. 5000 lakhs (Rs. 5000 Lakhs) from HDFC Bank Ltd
is repayable within six months from the date of availment and carries
interest at the rate of 10.60% per annum
3 CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided
for) Contingent liabilities
3.1 The company has preferred a Writ Appeal before the Division Bench
of the Hon''ble High Court Madras challenging the Order pronounced in
Writ Petition No. 4030/2002 dated 28.02.2006 in connection with
increase in rate of water charges and the method of computation of
water charges pursuant to the G.O. No.474 dated 13.11.2001 for the
water drawn for industrial purposes The approximate amount under
dispute is Rs. 368.98 Lakhs (Rs. 360.66 Lakhs)
3.2 Sugar Unit I at Sathyamangalam was permitted to sell 100% of the
sugar production as Free Sugar for a period of 8 years from 1985-86
Sugar Season Chief Director (Sugar) Directorate of Sugar Department of
Food New Delhi has restricted the entitlement of Free sale Sugar
Incentive to 275000 quintals production per season by a subsequent
notification A Writ Petition has been filed in the Madras High Court
Challenging the restriction imposed and interim injunction has been
obtained By virtue of injunction order the entire production was sold
as Free Sugar The approximate unprovided quantum under dispute is Rs.
683.35 Lakhs (Rs.683.35 lakhs)
3.3 Sugar Unit I at Sathyamangalam was allowed to sell 100% of the
Sugar production as free sugar for 8 years from 1985-86 sugar season
and pay excise duty on incentive sugar as applicable to levy sugar and
to retain the difference in excise duty between levy and free sale
sugar In respect of incentive sugar sold by Unit I from 20.09.1991 to
31.01.1994, the Central Excise Department has issued show cause notices
to the Company to show cause why the difference of Rs.33/- per quintal
being the difference between duty on levy sugar and free sugar should
not be demanded from the Company The Company has filed Writ Petitions
in Madras High Court and the High Court disposed the case with
direction to submit all explanations before the adjudicating authority
Now the matter is pending before the adjudicating authority The excise
duty in dispute is Rs.149.99 lakhs (Rs.149.99 lakhs) 29.4 The Entry Tax
of Rs. 289.56 lakhs (Rs. 287.54 Lakhs) on Inter-state purchase of rough
blocks is disputed
3.4 The Company has received a demand for payment of excise duty for
Rs.148.43 lakhs on the machineries purchased for co-generation plant
which have been cleared by the manufacturers based on the certificates
alleged to have been forged by an Official in the Ministry of Finance
The Company has remitted the amount under protest The company opted for
obtaining a valid certificate for which steps have been ta
3.5 The company has preferred an appeal before the Commissioner of
Income Tax (Appeals); challenging the order of Assistant Commissioner
of Income Tax in connection with disallowance of deduction under
section 80IA of the Income Tax Act 1961 for the Assessment year 2010-11
The quantum under dispute is Rs.1684.27 Lakhs
3.6 As at the year end the Company has an obligation under EPCG Scheme
to export sugar of a value of USD 10317105 and to export granite of a
value of USD 3184080
3.7 Estimated amount of contracts remaining to be executed on capital
account - Tangible Assets not provided for is Rs. 13789.42 Lakhs
(Rs. 967.87 Lakhs)
4 Segment Information for the year ended 31st March 2013
The Company has identified business segments as its primary segment and
geographic segments as its secondary segment
Business segments are primarily Sugar Power Distillery and others
Revenues and Expenses directly attributable to segments
are reported under each reportable segment Expenses which are not
directly identifiable to each reportable segment have been allocated on
the basis of associated revenues of the segment/manpower efforts Income
or Expenses which are not attributable or allocable to segments have
been disclosed as unallocable Income / Expenses Assets and liabilities
that are directly attributable or allocable to segments are disclosed
under each reportable segment Geographical revenues are allocated based
on the location of the customer
5. Related Party disclosures as required under Accounting Standard on
"Related Party Disclosures" issued by the Institute of Chartered
Accountnts of India are given below
1. KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam, Chairman Sri B Saravanan, Managing Director
2 RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Balasubramaniam
Relatives
Sri B Saravanan (Son)
Sri S V Alagappan (Brother)
Sri S V Arumugam (Brother)
Sri B Saravanan
Relatives
Sri S V Balasubramaniam (Father)
3 ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES
ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
Annamallai Retreading Company Private Limited
Annamallai Enterprise Limited
Bannari Amman Spinning Mills Limited Bannari Amman Exports Limited
Madras Sugars Limited Shiva Cargo Movers Limited Shiva Distilleries
Limited Shiva Texyarn Limited
6 Disclosure pursuant to Accounting Standard 28 (AS 28) on Impairment
of assets During the year the company had reviewed the carrying value
of assets for finding out impairment if any The review has revealed
that there is no impairment as per Accounting Standard 28
7 Previsous year''s figures have been regrouped / reclassified
wherever necessary to correspond with the current year''s
classification / disclosure
8 The annual increase in the rate of power charges for supplies made
from 20 MW Cogeneration plant at Alathukombai Village Sathyamangalam
Erode District Tamilnadu to Tamilnadu Electricity Board as prescribed
in the Power Purchase Agreement entered has not been provided in the
books
9 There are no derivative financial instruments either for hedging or
for speculation outstanding as at the Balance Sheet date
10 Foreign currency exposures that are not hedged by a derivative
instrument or otherwise are as under :-
Mar 31, 2012
A. Terms / rights attached to equity shares
The company has issued only one class of equity shares having face
value of Rs.10/- each. O ne equity share carries one vote. The members
are entitled to vote in accordance with their shareholding. The Company
declares and pays dividend in Indian rupees. The dividend recommended
by the Board of Directors is subject to the approval of the
shareholders in the ensuing Annual General Meeting
1.1 Rupee term loan of Rs. 4200 Lakhs (Rs.5600 Lakhs) is secured by
pari passu charge on the movable plant and machinery and pari passu
second charge on the current assets of the Co-generation Plant at Sugar
Unit IV. The loan is further secured by mortgage on lands admeasuring
50.93 acres and buildings thereon pertaining to the Co-generation Plant
at Sugar Unit-IV
The loan carries interest at the rate of Bank s Base rate plus 2.25%
and repay able in 20 equal quarterly installments of Rs.350 Lakhs each
starting from June 2010
Out of the above loan, amount repayable within twelve months is Rs 1400
lakhs (Rs.1400 Lakhs) is grouped under other current liabilities
1.2 The two years Corporate Loan of Rs.5625 lakhs (Nil) is against
assignment of receivables from Electricity Board (free from
encumbrance). The loan carries interest at the rate of Bank s Base rate
plus 1% and repay able in 24 equal monthly installments of Rs.312.50
Lakhs each starting from October 2011
Out of the above loan, amount repayable within twelve months is Rs 3750
lakhs (Nil) which is grouped under other current liabilities
1.3 Loan from Sugar Development Fund (Government of India) availed for
modernization/expansion of sugar unit - I amounting to Rs. 775.39 Lakhs
(Rs. 1085.55 Lakhs) is secured by way of exclusive second charge on the
movable and immovable properties of Sugar Unit - I
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement. Repayment of principal and
interest thereon commenced after a period of 8 years from the date of
disbursement and in five equal annual installments. The loan was
disbursed during the financial year 2002
Out of the above loan, amount repayable within twelve months is Rs
310.16 lakhs (Rs. 310.16 lakhs) which is grouped under other current
Liabilities
1.4 Loan from Sugar Development Fund (Government of India) availed for
co-generation plant in unit-II, amounting to Rs. 290.17 Lakhs
(Rs.580.34 Lakhs) is secured by way of exclusive second charge on the
movable and immovable properties of Sugar Unit-II
The loan carries interest at the rate of 2% below the bank rate
prevailing on the date of disbursement. Repayment of principal and
interest thereon commenced after the expiry of three years and in ten
equal half yearly installments. The Loan was disbursed during the
financial year 2005
Out of the above loan, amount repayable within twelve months is
Rs.290.17 lakhs (Rs.290.17 Lakhs) which is grouped under other
current liabilities
1.5 Term loan of Rs. 136.84 lakhs (Rs.2379.55 Lakhs) under SEFASU
notified by Government of India availed from Punjab
National Bank consortium consists of Punjab National Bank, Bank of
Baroda, Canara Bank, The Karur Vysya Bank Ltd, Union Bank of India,
Indian Overseas Bank, State Bank of Travancore, State Bank of India,
State Bank of Hyderabad & Bank of India in secured by residual third
charge on all fixed assets forming part of block assets and land and
buildings of Sugar Units - I, II and III
The loan carries interest subvention at the rate of 12% per annum and
is repayable in 24 equal installments after the expiry of 2 years from
the date of disbursement
The loan amount repayable within twelve months is Rs 136.84 lakhs (Rs
2276.72 lakhs) is grouped under other current liabilities
2.1 C ash Credit and other Working Capital Limits/ Demand Loan
sanctioned by Punjab National Bank consortium consists of Punjab
National Bank, Bank of Baroda, Canara Bank, The Federal Bank Limited,
The K arur Vysya Bank Limited, Union Bank of India, Indian Overseas
Bank, State Bank of Travancore, State Bank of India, State Bank of
Hyderabad, Bank of India and Axis Bank Limited to the Company s Sugar
Units are secured by way of hypothecation of current assets and other
movable block assets of the Sugar Units and third mortgage on the
immovable properties of the Sugar Units
The credit limits availed as at 31.3.2012 is Rs. 19810.30 Lakhs (Rs.
15903.49 Lakhs)
The availed limits are repayable on demand and carries interest ranges
between Bank's base rate plus 0.50% and 3% per annum
2.2 Packing Credit Limit and other working capital limits sanctioned
by Punjab National Bank and State Bank of India to Granite Division are
secured by way of hypothecation of current assets and second mortgage
on other movable and immovable properties of Granite Division
The credit limits availed as at 31.3.2012 is Nil (Rs. 83.78 lakhs)
The credit limits availed are repayable on demand and carries interest
ranges between Bank s Base Rate plus 0.75% and 1.50% per annum
2.3 Cash Credit Limits sanctioned by Canara Bank and The Lakshmi Vilas
Bank Ltd to Distillery Unit in Tamilnadu are secured by way of
hypothecation of current assets and second charge on other movable and
immovable properties of the Distillery
Unit in Tamilnadu
The credit limits availed as at 31.3.2012 is Rs. 148.39 Lakhs (Nil)
The cash credit limits are repayable on demand and carries interest
ranges between Bank's base rate plus 0.85% and 1 % per annum
2.4 The Unsecured Short term loan of Rs. 3300 lakhs (Nil) from Rabo
Bank is repayable within six months from the date of a ailment and
carries interest at the rate of 10.95% per annum
The Unsecured Short term loan of Rs. 5000 lakhs (Nil) from HDFC Bank
Ltd is repayable within six months from the date of a ailment and
carries interest at the rate of 11% per annum
The Unsecured Short term loan of Rs. 8000 lakhs (Rs.7000 Lakhs) from
Axis Bank Ltd is repayable within six months from the date of a ailment
and carries interest at the rate of 10.50% per annum
The Unsecured Short term loan availed from Yes Bank was repaid in full
(Rs.6000 lakhs)
The Unsecured Overdraft loan of Rs.267.24 Lakhs (Rs.2483.60 L akhs)
from ICICI Bank Ltd is repayable on demand and carries interest at the
rate of Base rate plus 1.75% per annum
The Unsecured Cash Credit loan of Rs.900.64 Lakhs (Nil) from IDBI Bank
Ltd is repayable on demand and carries interest at Base rate plus 1%
per annum
The vendors of the Company are yet to submit their status under Micro,
Small and Medium Enterprises; hence the relevant information is not
available with the company. Accordingly no disclosures relating to
Micro, Small and Medium Enterprises have been made in the Accounts.
3. Contingent liabilities and commitments (to the extent not provided
for) Contingent liabilities
3.1. The company has preferred a Writ Appeal before the Division
Bench of the Humble High Court, Madras challenging the Order
pronounced in Writ Petition No. 4030/2002 dated 28.02.2006 in
connection with increase in rate of water charges and the method of
computation of water charges pursuant to the G.O. No.474 dated
13.11.2001 for the water drawn for industrial purposes. The approximate
amount under dispute is Rs. 360.66 Lakhs (Rs. 352.34 Lakhs)
3.2. Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the
sugar production as Free Sugar for a period of 8 years from 1985-86 S
sugar Season. Chief Director (Sugar), Directorate of Sugar, Department
of Food, New Delhi, has restricted the entitlement of Free sale Sugar
Incentive to 2,75,000 quintals production per season by a subsequent
notification. A Writ Petition has been filed in the Madras High Court
Challenging the restriction imposed and interim injunction has been
obtained. By virtue of injunction order the entire production was sold
as Free Sugar. The approximate unprovoked quantum under dispute is Rs.
683.35 Lakhs (Rs.683.35 lakhs).
3.3. Sugar Unit-I at Sathyamangalam was allowed to sell 100% of the
sugar production as free sugar for 8 years from 1985-86 sugar season
and pay excise duty on incentive sugar as applicable to levy sugar and
to retain the difference in excise duty between levy and free sale
sugar. In respect of incentive sugar sold by Unit-I from 20.09.1991 to
31.01.1994 , the Central Excise Department has issued show cause
notices to the Company to show cause why the difference of Rs.33/- per
quintal being the difference between duty on levy sugar and free sugar
should not be demanded from the Company. The Company has filed Writ
Petitions in Madras High Court and the High Court disposed the case
with direction to submit all explanations before the adjudicating
authority. Now the matter is pending before the adjudicating authority
The excise duty in dispute is Rs.149.99 lakhs (Rs.149.99 lakhs).
3.4. The Entry Tax of Rs. 287.54 lakhs (Rs. 284.78 Lakhs) on
Inter-state purchase of rough blocks is disputed
3.5. The Company has received a demand for payment of excise duty for
Rs.148.43 lakhs on the machineries purchased for co-generation plant
which have been cleared by the manufacturers based on the certificates
alleged to have been forged by an Official in the ministry of
Finance. The Company has remitted the amount under protest. The company
opted for obtaining a valid certificate for which steps have been taken
through a writ Petition filed in Honble High Court of Madras.
3.6. The Company has been asked to pay Electricity Tax of 10 Paise
per unit with effect from 16th June 2003 for the electricity consumed
from own captive power generators which has been disputed by filing a
Writ Petition before the Hon'ble High Court of Madras. The approximate
quantum under dispute is Rs. 213.85 Lakhs (Rs.194.02 Lakhs).
3.7. The company has preferred an appeal before the Commissioner of
Income Tax (Appeals); challenging the order of Assistant Commissioner
of Income Tax in connection with disallowance of deduction under
section 80IA of the Income Tax Act, 1961 for the assessment year
2009-10. The quantum under dispute is Rs.695.40 Lakhs.
3.8. As at the year end the Company has an obligation under EPCG
Scheme to export sugar of a value of USD 97,25,647 and to export granite
of a value of USD 79,87,176.
3.9. Estimated amount of contracts remaining to be executed on
capital account - Tangible Assets not provided for is Rs. 967.87
Lakhs (Rs. 1134.56 lakhs).
4. Segment Information for the year ended 31st March 2012
The Company has identified business segments as its primary segment and
geographic segments as its secondary segment. Business segments are
primarily Sugar, Power, Distillery and others. Revenues and expenses
directly attributable to segments are reported under each reportable
segment. Expenses which are not directly identifiable to each
reportable segment have been allocated on the basis of associated
revenues of the segment/manpower efforts. Income or Expenses which are
not attributable or allocable to segments have been disclosed as
unallowable Income / Expenses. Assets and liabilities that are directly
attributable or allocable to segments are disclosed under each
reportable segment. Geographical revenues are allocated based on the
location of the customer.
5. Related Party disclosures as required under Accounting Standard on
"Related Party Disclosures issued by the Institute of Chartered
Accountants of India are given below.
1. KEY MANAGEMENT PERSONNEL :
- Sri S V Bala subramaniam, Chairman
- Sri B Saravanan, Managing Director
2. RELATIVES OF KEY MANAGEMENT PERSONNEL :
Sri S V Bala subramaniam Relatives :
(1) Sri B Saravanan (Son)
(2) Sri S V Alagappan (B rother)
(3) Dr S V Kandasami (B rother)
(4) Sri S V A rumugam (Brother)
Sri B S aravanan Relatives:
Sri S V Bala subramaniam (Father)
3. ENTERPRISES OVER WHICH KEY MANAGEMENT PERSONNEL OR THEIR RELATIVES
ARE ABLE TO EXERCISE SIGNIFICANT INFLUENCE :
1. Annamallai Retreading Company (P) Limited
2. Annamallai Enterprise (P) Limited
3. Bannari Amman Spinning Mills Limited
4. Bannari Amman Exports Limited
5. Madras Sugars Limited
6. Shiva Cargo Movers Limited
7. Shiva Distilleries Limited
8. Shiva Texyarn Limited
9. Vedanayagam Hospital Limited
6. Disclosure pursuant to Accounting Standard 28 (AS 28) on
Impairment of assets - During the year, the company had reviewed the
carrying value of assets for finding out impairment if any. The review
has revealed that there is no impairment as per Accounting Standard 28.
7 . The Revised Schedule VI has become effective from 1st April, 2011
for the preparation of financial statements. This has significantly
impacted the disclosure and presentation made in the financial
statements. Previous year s figures have been regrouped / reclassified
wherever necessary to correspond with the current years classification
/ disclosure.
8. The annual increase in the rate of power charges for supplies
made from 20 MW Cogeneration plant at Al athukombai Village,
Sathyamangalam, Erode District, Tamilnadu to Tamilnadu Electricity
Board as prescribed in the Power Purchase Agreement entered, has not
been provided in the books, considering the uncertainty in the
realization of the same.
9. There are no derivative financial instruments either for hedging
or for speculation outstanding as at the Balance Sheet date.
Mar 31, 2011
1 Sugar Development Fund Loan of Rs 134.95 Lakhs (Rs 134.95 Lakhs) is
guaranteed by State Bank of Travancore on counter guarantee of the
company
2 (a) The company has not received information from vendors regarding
their status under Micro, Small and Medium
Enterprises Development Act, 2006 and disclosures relating to their
outstanding amount and interest has not been made
(b) Amount credited to Investor Education and Protection Fund as on
31.03.2011 is Rs Nil (Nil)
3 Estimated amount of contracts remaining to be executed on capital
account not provided for is Rs 1134.56 Lakhs (Rs 2284.66 lakhs)
4 The annual increase in the rate of power charges for supplies made
from 20 MW co-generation plant at Alathukombai Village, Sathyamangalam
Taluk, Erode District, Tamilnadu to Tamilnadu Electricity Board as
prescribed in the power purchase agreement entered, has not been
provided in the books, considering the uncertainty in the realisation
of the same
5 Contingent Liabilities
(a) The company has preferred a Writ Appeal before the Division Bench
of the Hon'ble High Court, Madras challenging the order pronounced in
Writ Petition No. 4030/2002 dated 28.2.2006 in connection with increase
in rate of water charges and the method of computation of water charges
pursuant to the G.O. No.474 dated 13.11.2001 for the water drawn for
industrial purposes. The approximate amount under dispute is Rs 352.34
Lakhs (Rs 344.01 Lakhs)
(b) Sugar Unit-I at Sathyamangalam was permitted to sell 100% of the
sugar production as Free Sugar for a period of 8 years from 1985-86
sugar season. Chief Director (Sugar), Directorate of Sugar, Department
of Food, New Delhi, has restricted the entitlement of free sale sugar
incentive to 2,75,000 quintals production per season by a subsequent
notification. A Writ Petition has been filed in the Madras High Court
Challenging the restriction imposed and interim injunction has been
obtained. By virtue of injunction order the entire production was sold
as free sugar. The approximate unprovided quantum under dispute is Rs.
683.35 Lakhs (Rs 683.35 Lakhs)
(c) Sugar Unit-I at Sathyamangalam was allowed to sell 100% of the
sugar production as free sugar for 8 years from 1985-86 sugar season
and pay excise duty on incentive sugar as applicable to levy sugar and
to retain the difference in excise duty between levy and free sale
sugar. In respect of incentive sugar sold by unit-I from 20.9.1991 to
31.1.1994, the Central Excise Department has issued show cause notices
to the company to show cause why the difference of Rs 33/- per quintal
being the difference between duty on levy sugar and free sugar should
not be demanded from the company. The Company has filed Writ Petitions
in Madras High Court and the High Court disposed the case with
direction to submit all explanations before the adjudicating authority.
Now the matter is pending before the adjudicating authority. The excise
duty in dispute is Rs149.99 lakhs (Rs149.99 lakhs)
(d) The Entry tax of Rs 284.78 lakhs (Rs 268.80 Lakhs) on Inter-state
purchase of rough blocks is disputed
(e) The Company has received a demand for payment of excise duty for
Rs148.43 lakhs on the machineries purchased for co-generation plant
which have been cleared by the manufacturers based on the certificates
alleged to have been forged by an Official in the Ministry of Finance.
The Company has remitted the amount under protest. The company opted
for obtaining a valid certificate for which steps have been taken
through a Writ Petition filed in Hon'ble High Court of Madras
(f) The Company has been asked to pay Electricity tax of 10 Paise per
unit with effect from 16th June 2003 for the electricity consumed from
own captive power generators which has been disputed by filing a Writ
Petition before the Hon'ble High Court of Madras. The approximate
quantum under dispute is Rs 194.02 Lakhs (Rs 173.82 Lakhs)
(g) The company has preferred an appeal before the Commissioner of
Income Tax (Appeals) challenging the order of Assistant Commissioner of
Income Tax in connection with disallowance of deduction under section
80IA of the Income Tax Act 1961 for the assessment year 2008-09. The
quantum under dispute is Rs 404.85 Lakhs
(h) As at the year end the Company has an obligation under EPCG Scheme
to export sugar of a value of USD 9725647 and to export granite of a
value of USD 4517414
6 (a) There are no derivative financial instruments either for hedging
or for speculation outstanding as at the Balance Sheet date
7 Disclosure pursuant to Accounting Standard 28 (AS 28) on impairment
of assets - During the year, the company had reviewed the carrying
value of assets for finding out impairment if any. The review has
revealed that there is no impairment as per AS 28
8 Amount due from Directors is Nil (Nil ). Maximum amount due from
Directors during the year is Nil (Nil)
9 Amount due from officers of the company is Rs 4.98 Lakhs (Rs 11.72
Lakhs). Maximum amount due from officers of the company during the year
is Rs 11.00 Lakhs (Rs 12.48 Lakhs)
10 Related Party disclosures as required under Accounting Standard on
"Related Party Disclosures" issued by the Institute of Chartered
Accountants of India are given below
1 Key Management Personnel
Sri S V Balasubramaniam, Chairman Sri B Saravanan, Managing Director
2 Relatives of Key Management Personnel
Sri S V Balasubramaniam
Relatives :
(1) Sri B Saravanan - Son
(2)Sri S V Alagappan - Brother
(3)Dr S V Kandasami - Brother
(4) Sri S V Arumugam - Brother
Sri B Saravanan
Relatives
(1) Sri S V Balasubramaniam -Father
3 Enterprises over which Key Management Personnel or their Relatives
are able to exercise significant influence
1 Annamallai Retreading Company (P) Limited
2 Madras Sugars Limited
3 Anamallais Automobiles (P) Limited
4 Bannari Amman Spinning Mills Limited
5 Shiva Distilleries Limited
6 Vedanayagam Hospital Limited
7 Shiva Texyarn Limited
Notes : (1) Remuneration to key management personnel is disclosed in
Schedule No. 17 (read with item No. 14 in notes attached to and forming
part of accounts)
(2) Sitting fees to Directors is disclosed in Schedule No. 17
(3) Balance outstanding as on 31st March 2011 is Nil (Nil)
18 Earnings per share
(a) Weighted average number of equity shares of Rs.10/-each (i) Number
of shares at the beginning of the year
(ii) Number of shares at the end of the year
Weighted average number of equity shares outstanding during the year
(b) Net Profit after tax available for equity shareholders (Rs in
Lakhs)
(c) Basic and diluted earnings per share (Rs)
11 Figures for the previous year have been suitably regrouped wherever
necessary to confirm to this year's classification
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