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Notes to Accounts of Bharat Seats Ltd.

Mar 31, 2015

1. The rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of capital are as under:

Equity shares

The Company has only one class of equity shares having a par value of Rs. 2 per share. Each shareholder is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. During the year ended 31st March 2015, the amount of per share dividend recognized as distributions to Equity Shareholders is Re 0.90/- (31st March 2014 : Re 0.80).The total dividend appropriation for the year ended 31st March 2015 amounted to Rs. 34,013,058/- (Rs 29,389,144) including corporate dividend tax of Rs. 5,753,058/- (Rs 4,269,144). In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held b.

2.Contingent Liabilities & Commitments

(All amounts in Rs., unless otherwise stated)

Particulars As at As at 31st March 31st March 2015 2014

(i) Contingent Liabilities

(a) Claims against the company not acknowledged as debt

- Disputed Excise Matters 345,668,355 345,668,355

- Disputed Service Tax Demands - 1,147,470

- Disputed Income Tax Demands

(b) Bank guarantee furnished 185,241

93,315,100 121,205,000

438,983,455 468,206,066

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advance) 116.873.490 83,818,325

116.873.490 83,818,325

555,856,945 552,024,391

3. Statement Of Realization Of Assets Other Than Fixed Assets And Non - Current Investments

In the opinion of the management, current assets, loans and advances have a value on realisation in the ordinary course of business, at least equal to the amount shown in the Balance Sheet.

In respect of Trade & other receivables, there is no major difference or dispute pending reconciliation/ settlement.

In respect of Trade & other payables, management is in the process of reconciliation.

4. Segment Reporting

The Company has only one reportable business segment as it manufactures and deals only in different seating systems, carpet etc. in terms of AS 17 "Segment Reporting" notified by Central Government under Companies (Accounting Standards), Rules 2006 and therefore, the disclosure requirements of the Standard are not applicable. Further, the Company operates only in one geographical segment -"India". All the assets of the company are located in India. Further the entire revenue is also derived from customers in India.

5. Related Party Disclosure (In pursuance of AS-18) a) Names of parties

i) Where control exists : None (i.e. holding companies subsidiaries and fellow subsidiaries)

ii) Parties in respect of : Maruti Suzuki India which Bharat Seats Ltd.Ltd. Suzuki Motor Corporation, Japan. is an Associate Sharda Motor Industries Limited

iii) Key management persons : Mr. N. D. Relan -Chairman and their relatives Mr. Rohit Relan - Managing Director Mr. Rishabh Relan - Chief Operating Officer Mr. Sanjeev Kumar - Chief Financial Officer Ms. Ritu Bakshi-Company Secretary Mr. T J. Chacko - Whole Time Director (w.e.f. 1st December, 2014)

Relatives :

Mrs. Sharda Relan -Wife of Mr. N.D. Relan Mrs. Ritu Relan -Wife of Mr. Rohit Relan Mr. Pranav Relan-Son of Mr. RohitRelan Mr. Ayush Relan -Son of Mr. Rohit Relan Mr. Ajay Relan- son of Mr. N.D. Relan Mrs. Mala Relan-Wife of Mr. Ajay Relan Ms. Aashita Relan- Daughter of Mr. Ajay Relan Mr. Aashim Relan-Son of Mr. Ajay Relan

iv) Other enterprises over : N. D. Relan (HUF) which person(s) referred to Rohit Relan (HUF) in (iii) above is able to Ajay Relan (HUF) exercise Sharda Enterprises significant influence Relan Industrial Finance Limited Progressive Engineering & Automation Pvt. Ltd. Sharda Inoac Pvt. Ltd. Pebco Motors Ltd. Toyota Boshoku Relan India Pvt. Ltd. Toyo Sharda India Private Limited

6. Borrowing cost capitalized during the year Rs. 5,402,179/- (Previous Year Rs. 15,040,626) includes Rs. 4,319,858/- towards fixed assets (Previous Year Rs. 11,627,828) & Rs. 1,082,321/- towards capital work in progress (Previous year Rs. 3,412,798/-).

7. The estimated useful lives of certain fixed assets have been revised in accordance with Schedule II to the Companies Act 2013, with effect from 1st April, 2014. Pursuant to these changes in useful lives, the depreciation expense for the Year ended 31st March 2015 is lower by Rs. 4,00,649 and for the assets whose revised useful lives have expired on or before 31st March, 2014, the net book value of Rs. 9,66,839 (net of deferred tax of Rs. 4,64,349) has been deducted from the retained earnings.

8. During the current year pursuant to section 135 of the Companies Act, 2013 corporate social responsibility expenses of Rs. 921,000 has been incurred by the company which have been disclosed in other expenses under note no. 31.

9. Current year financial statements are prepared as per Accounting Standard prescribed under section 133 read with rule 7 of Companies (Accounts) Rules, 2014 and relevant provisions of Companies act 2013 and previous year financial statement were prepared as per relevant provisions of the Companies Act, 1956 (refer General circular 08/2014 dated 04/04/2014 of the Ministry of Corporate Affairs for applicability of relevant provisions/ schedules/ rules of the Companies Act, 1956 for the financial statements prepared for the financial year commenced earlier than 01.04.2014) and the provisions of the Companies Act, 2013 (to the extent applicable).

10. Note no. 1 to 45 pertaining to Balance Sheet and statement of Profit and Loss Account form an integral part of the accounts.

11. Previous year figures have been regrouped and /or reclassified, wherever necessary.


Mar 31, 2014

1. Contingent Liabilities & Commitments

(All amounts in Rs., unless otherwise stated)

Particulars As at 31 March 2014 As at 31 March 2013

(i) Contingent Liabilities

(a) Claims against the company not acknowledged as debt

- Disputed Excise Matters 345,668,355 346,034,541

- Disputed Service Tax Demands 1,147,470 1,147,470

- Disputed Income Tax Demands 185,241 -

(b) Bank guarantee furnished to custom authorities 2,800,000

349,801,066 347,182,011

(ii) Commitments

(a) Estimated amount of contracts remaining to be 83,818,325 209,030,505

executed on capital account and not provided for (Net of advance) 83,818,325 209,030,505

433,619,391 556,212,516

2. Statement Of Realization Of Assets Other Than Fixed Assets And Non - Current Investments

In the opinion of the management, current assets, loans and advances have a value on realisation in the ordinary course of business, at least equal to the amount shown in the Balance Sheet. In respect of Trade & other receivables, there is no major difference or dispute pending reconciliation/ settlement.

In respect of Trade & other payables, management is in the process of reconciliation.

Note no. 3 - GRATUITY AND EARNED LEAVE BENEFIT PLANS

The Company has a defned beneft gratuity plan. Every employee who has completed fve years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Scheme is funded with "The Life Insurance Corporation of India" in the form of a qualifying insurance policy. The Company has also provided for Leave Encashment which is unfunded.

The following tables summarize the components of net beneft expense recognized in the proft and loss statement and the funded status and amounts recognized in the balance sheet for the respective plans (as per actuarial valuation as on March 31, 2014).

Note No. 4: Segment Reporting

The Company has only one reportable business segment as it manufactures and deals only in different seating systems, carpet etc. in terms of AS 17 "Segment Reporting" notifed by Central Government under Companies (Accounting Standards), Rules 2006 and therefore, the disclosure requirements of the Standard are not applicable. Further, the Company operates only in one geographical segment –"India". All the assets of the company are located in India. Further the entire revenue is also derived from customers in India.

1. Under the Micro, Small and Medium Enterprises Development Act, 2006, the Company is in process of identifying such parties. However, to the extent they already been identifed, necessary disclosures have been made as required under the said Act.

2. (i) Particulars of Un-hedged Foreign Currency Exposure as at Balance Sheet Date : Foreign Currency Term Loan NIL [P.Y. – Rs. 278,870,461 (USD 5,127,303.74)]

Foreign Currency ECB Rs. 83,238,089 (JPY 141,489,188)

[P.Y.Rs. 89,389,097 (Japanese Yen 154,759,517)]

Creditors Rs. 7,713,811 (Euro 97,377.60)

[P.Y.– 3,177,351.94 (Euro 44,827.20)]

NIL

[P.Y. – 215,547 (USD 770)]

Rs. 1,1070,785 (JPY 18,118,166)

[P.Y. Rs. 880,992 (JPY 1,311,000)]

Advances recoverable in cash or kind NIL

[P.Y. Rs. 3,480,915 (USD 64,000)] Rs. 4,893,502 (Euro 60112.80) (P.Y. NIL)

3. Borrowing cost capitalized during the year Rs.15,040,626/- (Previous Year Rs. 21,797,777) includes Rs 11,627,828/- towards fxed assets (Previous Year Rs. 624,545) & Rs. 3,412,798 /- towards capital work in progress (Previous year Rs. 21,173,232 /-).

4. Note no. 1 to 45 pertaining to Balance Sheet and statement of Proft and Loss Account form an integral part of the accounts.

Note No. 5: Previous year fgures have been regrouped and /or reclassifed, wherever necessary.


Mar 31, 2013

1. Contingent Liabilities & Commitments

(All amounts in Rs., unless otherwise stated)

Particulars As at 31 March 2012 As at 31 March 2011

(i) Contingent Liabilities

(a) Claims against the company not acknowledged as debt

- Disputed Excise Matters 346,034,541 346,256,646

- Disputed Custom Duty Matters 1,166,957

- Disputed Income Tax Demands 1,147,470 1,147,470

- Disputed Income Tax Demands 3,523,811

347,182,011 352,094,884

(ii) Commitments

(a) Estimated amount of contracts remaining to be 209,030,505 403,042,266

executed on capital account and ot provided for (Net of advance) 209,030,505 403,042,266

556,212,516 755,137,150

2. Statement Of Realization Of Assets Other Than Fixed Assets And Non - Current Investments

In the opinion of the management, current assets, loans and advances have a value on realisation in the ordinary course of business, at least equal to the amount shown in the Balance Sheet. In respect of Trade & other receivables, there is no major difference or dispute pending reconciliation/ settlement. In respect of Trade & other payables, management is in the process of reconciliation."

Note no. 3 - GRATUITY AND EARNED LEAVE BENEFIT PLANS

The Company has a defi ned benefi t gratuity plan. Every employee who has completed fi ve years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Scheme is funded with "The Life Insurance Corporation of India" in the form of a qualifying insurance policy. The Company has also provided for Leave Encashment which is unfunded.

The following tables summarize the components of net benefi t expense recognized in the profi t and loss statement and the funded status and amounts recognized in the balance sheet for the respective plans (as per actuarial valuation as on March 31, 2013).

Note No. 4: Segment Reporting

The Company has only one reportable business segment as it manufactures and deals only in different seating systems, carpet etc. in terms of AS 17 "Segment Reporting" notifi ed by Central Government under Companies

(Accounting Standards), Rules 2006 and therefore, the disclosure requirements of the Standard are not applicable. Further, the Company operates only in one geographical segment –"India". All the assets of the company are located in India. Further the entire revenue is also derived from customers in India.

Note: Since no commission has been paid to any director, the computation of profi t under section 349 of the Companies Act, 1956 has not been given.

5. Borrowing cost capitalized during the year Rs. 21,797,777/- (Previous Year Rs. 17,611,707) includes Rs. 624,545/- towards fi xed assets (Previous Year Rs. 7,081,371) & Rs. 21,173,232 /- towards capital work in progress (Previous year Rs. 10,530,336/-).

6. Note no. 1 to 46 pertaining to Balance Sheet and Profi t and Loss Account form an integral part of the accounts.

Note No. 7: Previous year fi gures have been regrouped and /or reclassifi ed, wherever necessary.


Mar 31, 2012

1.1 The rights, preferences and restrictions attaching to each class of shares including restrictions on the distribution of dividends and the repayment of payment are as under:

The company has only one class of equity shares having a par value of Rs. 2 per share. Each shareholder is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. During the year ended 31 March 2012, the amount of per share dividend recognized as distributions to Equity Shareholders was Re. 0.80/- (31 March 2011 : Rs. 0.80). The total dividend appropriation for the year ended March 31, 2012 amounted to Rs. 2,91,95,092/- (Rs. 2,91,95,092) including corporate dividend tax of Rs 40,75,092/- (Rs 40,75,092).

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders.

1.2 The aforesaid Shares include 1,57,00,000 Equity shares allotted as fully paid bonus shares in the ratio of 1:1 by capitalization of General Reserve during the year ended 31st March 2008.

2. Contingent Liabilities & Commitments

(All amounts in Rs., unless otherwise stated)

Particulars_ As at 31 March 2012 As at 31 March 2011

(I) Contingent Liabilities

(a) Claims against the company not acknowledged as debt '

- Disputed Excise Matters1 346,256,646 333,146,000

- Disputed Custom Duty Matters2 1,166,957 1,166,957

- Disputed ESI Demands - 539,000

- Disputed Service Tax Demands 1,147,470 1,146,000

- Disputed Income Tax Demands 3,523,811 3,523,811

352,094,884 339,521,768

(II) Commitments

(a) Estimated amount of contracts remaining to be 403,042,266 331,758,000

executed on capital account and not provided for (Net of advance) 403,042,266 331,758,000

755,137,150 671,279,768

1. On the matter of Rs. 31.95 crores including penalty of Rs. 6.5 crores, which had been decided in favour of the Company by Customs, Excise and Service Tax Appellate Tribunal, New Delhi (CESTAT), the department had sought the intervention of the Hon'ble Delhi High Court which had then issued directions to CESTAT to clarify certain points of law arising out of that Order. The matter is still pending for final decision. Further for other matters-Rs 136.46 lacs.

2. The amount has been deposited under protest.

3. Statement Of Realization Of Assets Other Than Fixed Assets And Non - Current Investments

In the opinion of the management, current assets, loans and advances have a value on realization In the ordinary course of business, at least equal to the amount shown in the Balance Sheet. In respect of Trade & other receivables, there is no major difference or dispute pending reconciliation/settlement. In respect of Trade & other payables, management is in the process of reconciliation.

Note No. 4 - GRATUITY AND EARNED LEAVE BENEFIT PLANS

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Scheme is funded with "The Life Insurance Corporation of India" in the form of a qualifying insurance policy. The Company has also provided for Leave Encashment which is unfunded.

The following tables summarize the components of net benefit expense recognized in the profit and loss account and the flinted status and amounts recognized in the balance sheet for the respective plans (as per actuarial valuation as on March 31, 2012).

Net employee benefit expense (recognized in the Statement of Profit & Loss for the year ended March 31, 2012)

Note No 5: Segment Reporting

The Company has only one reportable business segment as it manufactures and deals only in different seating systems, carpet etc. in terms of AS 17 "Segment Reporting issued by "The Institute of Chartered Accountants of India and therefore, the disclosure requirements of the Standard are not applicable. Further ,the Company operates only in one geographical segment - " India. All the assets of the company are located in India. Further the entire revenue is also derived from customers in India.

Note no. 6 - Additional Notes to the Accounts

1. Under the Micro, Small and Medium Enterprises Development Act, 2006, the Company is in process of identifying such parties. However, to the extent they already been identified, necessary disclosures have been made as required under the said Act. Further, in case the parties already identified, there are no Micro, Small and Enterprises to whom the Company owes dues which are outstanding for more than 45 days as at 31st March 2012.

2. The Company has only one reportable business segment as it manufactures and deals only in different seating systems, carpet etc. in terms of AS 17 Segment Reporting issued by The Institute of Chartered Accountants of India and therefore, the disclosure requirements of the Standard are not applicable. Further, the Company operates only in one geographical segment - " India. All the assets of the company are located in India. Further the entire revenue is also derived from customers in India.

3. Borrowing cost capitalized during the year - Rs.1,76,11,707/- includes Rs. 70,81,371/- towards fixed assets and Rs. 1,05,30,336/- towards capital work in progress (Previous year Rs. nil)

4. Note no. 1 to 45 pertains to Balance Sheet and Profit and Loss Account form an integral part of the accounts.

 
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