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Notes to Accounts of Bhushan Steel Ltd.

Mar 31, 2015

Note 1:

(1) 12.00% Redeemable Non-Convertible 250 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 2500 Lacs (Previous Year 12.00% Redeemable Non-Convertible 250 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 2500 Lacs). Debentures are redeemable at par in one bullet payment at the end of 10th year from the date of allotment i.e 31.08.2012 and are Secured by first charge on paripassu basis on the fixed assets of the Company offering minimum Fixed Asset Coverage Ratio of 1.25 times during the tenure of debentures and personal guarantee of Sh. B.B.Singal & Sh.Neeraj Singal.

(2) 12.50% Redeemable Non-Convertible 2000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 20000 Lacs (Previous Year 12.50% Redeemable Non-Convertible 2000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 20000 Lacs) are redeemable in three equal annual installments commencing from the end of 5th year from the date of allotment i.e 30.08.2013 and are Secured by first charge on pari passu basis on the fixed assets of the Company. However we have considered repayment terms for the same as per the bilateral structuring proposal with the lenders.

(3) 12.00% Redeemable Non-Convertible 100 Debentures of Rs. 100 Lacs each outstanding on 31st March 2015 Rs. 10000 Lacs (Previous Year 12% Redeemable Non Convertible Debentures of Rs. 100 Lacs each outstanding on 31st March 2014 Rs. 10000 Lacs) (subordinate debt),are redeemable at par in one bullet payment at the end of 10 years and 1 Month from the date of allotment i.e 31.03.2008 and are secured by subsequent and subservient charge by way of hypothecation on the present and future assets of the Company so as to maintain minimum asset coverage of 1.25 times, throughout the currency of the Debentures. Debentures are further secured by pledge of Equity Shares of Bhushan Steel Limited, having market value not less than 1.5 times of loans, held by promoters/promoter entities, and Personal Guarantee of Shri B.B. Singal and Shri Neeraj Singal.

(4) 11.50% Redeemable Non-Convertible 3500 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 35000 Lacs (Previous Year 11.50% Redeemable Non-Convertible 3500 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 35000 Lacs) are redeemable in three equal annual installments commencing from the end of 5th year from the date of allotment i.e 04.01.2013 and are Secured by first charge on pari passu basis on the fixed assets of the Company. However we have considered repayment terms for the same as per the bilateral structuring proposal with the lenders.

(5) 12.00% Redeemable Non-Convertible 1050 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 10500 Lacs (Previous Year 12.00% Redeemable Non-Convertible 1050 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 10500 Lacs) are redeemable at the end of 4th,5th and 6th year in installments 35%,35% & 30% respectively commencing from the end of 4th year from the date of allotment i.e 28.03.2013 and are Secured by first charge on pari passu basis on the fixed assets of the Company.

(6) 11.75% Redeemable Non-Convertible 3000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 30000 Lacs (Previous Year 11.75% Redeemable Non-Convertible 3000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 30000 Lacs) are redeemable in three equal annual installments commencing from the end of 5th year from the date of allotment i.e 02.02.2012 and are Secured by first charge on pari passu basis on the fixed assets of the Company. However we have considered repayment terms for the same as per the bilateral structuring proposal with the lenders.

(7) 12.00% Redeemable Non-Convertible 4750 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 47500 Lacs (Previous Year 12.00% Redeemable Non-Convertible 4750 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 47500 Lacs). Debentures are redeemable at the end of 4th,5th and 6th year in installments 35%,35% & 30% respectively commencing from the end of 4th year from the date of allotment i.e 31.08.2012 and are Secured by first charge on pari passu basis on the fixed assets of the Company offering minimum Fixed Assets Coverage Ratio of 1.25 times during the tenure of debentures and personal guarantee of Sh. B.B.Singal and Sh. Neeraj Singal.

(8) 10.50% Redeemable Non-Convertible 3000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 30000 Lacs (Previous Year 10.50% Redeemable Non-Convertible 3000 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 30000 Lacs). Debentures are redeemable at par in three equal anuual installments commencing from the end of 6th year from the date of allotment i.e 13.08.2010 and are Secured by first charge on pari passu basis on the fixed assets of the Company. However we have considered repayment terms for the same as per the bilateral structuring proposal with the lenders.

(9) 10.90% Redeemable Non-Convertible 1750 Debentures of Rs. 10 Lacs each outstanding on 31st March 2015 Rs. 17500 Lacs (Previous Year 10.90% Redeemable Non-Convertible 1750 Debentures of Rs. 10 Lacs each outstanding on 31st March 2014 Rs. 17500 Lacs) are redeemable at par in four equal annual installments commencing from the end of 5th year from the deemed date of allotment i.e 26.08.2010 and are Secured by first charge on pari passu basis on the fixed assets of the Company.

(10) Secured by first mortgage charge on all of the company's immovable & movable properties both present and future including movable machinery, spares, tools & accessories (excluding specific charge created on favour of ECA Lenders), ranking pari passu inter-se, with the trustee of Debenture holders subject to prior charges created in favour of banks on stocks,book debts etc. for securing borrowing for working capital requirement,except Rs. 25036 Lacs (Previous Year Rs. 37933 Lacs) secured by subsequent & subservient charge on movable assets. Out of the above, the ECA Loans of Rs. 239255 Lacs (Previous Year Rs. 290449 Lacs) financed by ECA Lenders are secured by first exclusive charge on the assets financed & personal guarantee of two promoter directors. Out of these,Loans of Rs. 835469 Lacs (Previous Year Rs. 874937 Lacs) are guaranteed by the Personal Guarantee of two promoter directors and Loans of Rs. NIL (Previous Year Rs. 19182 Lacs) are guaranteed by the Personal Guarantee of One Promoter Director.

(11) Secured by first mortgage charge on all of the company's immovable & movable properties both present and future including movable machinery, spares, tools & accessories (excluding specific charge created in favour of ECA Lenders) ranking pari passu inter-se, with the trustee of Debenture holders subject to prior charges created in favour of banks on stocks,book debts etc. for securing borrowing for working capital requirement,except Rs. 15700 Lacs (Previous Year Rs. 4700 Lacs) secured by subsequent & subservient charge on movable assets. Loans of Rs. 1692104 Lacs (Previous Year Rs. 1305416 Lacs) are guaranteed by the Personal Guarantee of two promoter directors and Loans of Rs. 410576 Lacs (Previous Year Rs. 483398 Lacs) are guaranteed by the Personal Guarantee of One Promoter Director. Apart from this, Loans of Rs. 660106 Lacs(Previous year Rs.175662 Lacs) are also secured by pledge of 26% shares of Bhushan Steel Limited.

(12) Out of these Loans of Rs. 2250 Lacs (Previous year Rs. 3750 Lacs) are Secured by first mortgage charge on all of the company's immovable & movable properties both present and future including movable machinery, spares, tools & accessories (excluding specific charge created in favour of ECA Lenders) ranking pari passu inter-se, with the trustee of Debenture holders subject to prior charges created in favour of banks on stocks,book debts etc. for securing borrowing for working capital requirement and guaranteed by the Personal Guarantee of One Promoter Director. Apart from this Loans of Rs. 1345 Lacs (Previous year Rs. 1793 Lacs) are secured by subsequent & subservient charge on movable assets.

(13) Out of these Loans of Rs. 263 Lacs (Previous Year Rs. 322 Lacs) are guaranteed by the Personal Guarantee of Two Promoter Directors.

Detail of Repayment and Rate of Interest

Rate of Interest: All Rupee Term Loans are linked to the Benchmark Rate/Base Rate of the respective lenders on floating basis. All Foreign Currency Loans are linked to the LIBOR Rates of different lenders on floating basis.

(14) Maturity Profile of Long Term Borrowing (Other than NCDs) are set out as below: (Refer Note 48)

(Rs. in Lacs)

1 year 2-3 Years Beyond 3 years

Term Loans 49414 54876 2840421

(15) Domestic Loans sanctioned by SBI Syndication for Phase I & II of Orissa project was sanctioned at rate of interest of SBI Base Rate 2.00% (presently 11.85% p.a.) and repayable in 24 quarterly installments commencing from 24 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s. Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(16) Foreign Currency Loans for Phase I & II of Orissa project was sanctioned at interest rate of EURIBOR 0.45% (Presently 0.854% p.a.) repayable in 20 Half Yearly Installments commencing from six Months after completion of the project as per terms stipulated in respective loan/facility agreement/s.The repayment terms have been considered as per the bilateral structuring proposal with the respective lenders.

(17) Domestic Loans sanctioned by SBI Syndication for Phase III of Orissa project was sanctioned at rate of interest of SBI Base Rate 2.50% (presently 12.35% p.a.) and repayable in 17 quarterly installments commencing from 18 months after completion of the project as per terms stipulated in respective loan/facility agreement/s.Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(18) Foreign Currency Loans for Phase III of Orissa project was sanctioned at interest rate of EURIBOR 1.50% (Presently 1.689% p.a.) repayable in 20 half yearly installments commencing from 6 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s. The repayment terms have been considered as per the bilateral structuring proposal with the respective lenders.

(19) Another Foreign Currency Loan sanctioned for Phase III of the Orissa Project at interest rate of USD LIBOR 3.95% (Presently 4.295% p.a.) repayable in 6 annual installments commencing from 36 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s. Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(20) Another Foreign Currency Loan sanctioned for Phase III of the Orissa Project at interest rate of EURIBOR 1.75% (Presently 2.142%p.a.) repayable in 18 half yearly installments commencing from three Months after completion of the project as per terms stipulated in respective loan/facility agreement/s.The repayment terms have been considered as per the bilateral structuring proposal with the respective lenders.

(21) Domestic Loans sanctioned for Coke Oven 2 of Orissa project was sanctioned at rate of interest of Base Rate 2.50% (Presently 12.00% p.a.) and repayable in 24 quarterly installments commencing from 15 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s.Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(22) Foreign Currency Loans for Coke Oven 2 of Orissa Project was sanctioned at interest rate of USD LIBOR 4.50% (Presently 4.9235% p.a.) repayable in 12 half yearly installments commencing from 15 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s.Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(23) Domestic Loans sanctioned for CRCA & CRNGO Project of Orissa project was sanctioned at rate of interest of Base Rate 2.25% (Presently 12.25% p.a.) and repayable in 24 quarterly installments commencing from 12 Months after completion ofthe project as per terms stipulated in respective loan/facility agreement/s.Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(24) Domestic Loans sanctioned for Addition,Modification & Replacement Project at Orissa Site was sanctioned at rate of interest of Base Rate TP 1.25% (Presently 12.00% p.a.) and repayable in 32 quarterly installments commencing from 3 Months after completion of the project as per terms stipulated in respective loan/facility agreement/s.Now these loans are being considered in 5/25 flexible structuring scheme of RBI upto 25 years.

(25) Domestic Loans sanctioned for shoring up of Net Working Capital/ Normal Capital Expenditure was sanctioned at rate of interest of Base Rate 2.50% (Presently 12.50% p.a.) and repayable in 40 quarterly installments commencing from 30th June 2016, as per terms stipulated in respective loan/facility agreement/s.

Note 2.

(Rs. in Lacs)

Current Previous Year Year

1. Contingent Liabilities in respect of :

a) Sales Tax 36455.50 20626.34

b) ExciseDuty/Custom/ServiceTax 34455.01 33524.86

c) Entry Tax 29924.16 26506.22

d) Income Tax 17274.63 6115.58

e) Bills Discounted 10806.35 14413.38

f) Others 4577.53 4956.54

g) Undeclared Dividend including 1089.71 - Dividend Distribution Tax on Cumulative Redeemable Preference Shares

2. Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 83322.86 Lacs (Previous Year ' 188494.42 Lacs) (Net of Advances).

3. Other Commitment

a) Outstanding guarantees issued by the banks Rs. 371863.79 Lacs (Previous Year Rs. 374156.06 Lacs) counter guaranteed by the company including letter of credits issued.

b) The Company from time to time provides need based support to its subsidiary Bowen Energy PTY Limited (Australia) towards capital and other requirements.

c) Commitment for partly paid equity shares of Angul Sukinda Railway Limited, an associate company Rs. 7400.00 Lacs (Previous Year Rs. 7400.00 Lacs).

NOTE - 3

There is no present obligation arising from past events requiring provision in accordance with the guiding principle as enunciated in Accounting Standard (AS)- 29, as it is not probable that an outflow of resources embodying economic benefit will be required.

NOTE - 4

a) In terms of letter of offer dated January 9, 2013 the company had during the financial year 2012-13 allotted 14157220 Equity shares of Rs. 2/- each at a premium of Rs. 333 per share which were partly paid-up to the extent of Rs. 167.50 (comprising Rs. 1/- per Equity Share towards share capital and Rs. 166.50 per Equity Share as share premium) on Right basis in the ratio of 1 share for every 15 shares held by the shareholders.

The Company has during the financial year 2013-14 received Rs. 167.50 per Equity Share (comprising Rs. 1/- per Equity Share towards share capital and Rs. 166.50 per Equity Share as share premium) on account of first and final call money on 14156436 Equity Shares and 784 Equity Shares have been forfeited for non payment of First & Final Call Money. The new allotted shares rank pari passu in all respect with the existing Equity shares of the Company. The proceeds from Right Issue have been utilized for repayment of indebtedness and General Corporate purpose as per the object of the Right Issue.

b) 10% 133400 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- per share on the expiry of ten years from the date of allotment.

c) 10% 723400 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2013-14 on private placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- per share on the expiry of ten years from the date of allotment.

d) 10% 1276700 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2012-13 on private placement basis against the share application money received during the financial year 2011-12 amounting to Rs. 38301.00 Lacs. The Preference Shares are redeemable at a premium of Rs. 2900/- per share on or before the expiry of ten years from the date of allotment i.e. 1st March, 2013.

e) 10% 333400 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2012-13 on private placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- per share on or before the expiry of ten years from the date of allotment i.e. 25th March, 2013.

f) 10% 366667 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2011-12 on private placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- in two equal installments at the end of 3rd and 4th year i.e. on 4th March, 2015 and 4th March, 2016 respectively.

g) 10% 460000 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares will be redeemed at any time within a period often years from the date of allotment i.e. 29th March, 2012.

h) 10% 1800000 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs. 2400/- before the expiry of ten years from the date of allotment i.e. 30th March, 2012. During the financial Year 2013-14, 1200000 Preference Shares have been redeemed at a premium of Rs. 2400/- per share.

i) 10% Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2010-11 on private placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- before the expiry of ten years from the date of allotment i.e. 30th March, 2011 for 1500300 shares. During the financial Year 2013-14, 560067 Preference Shares have been redeemed at a premium of Rs. 2900/- per share.

j) 10% Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 3000/- per share during the financial year 2009- 10 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs. 2900/- before the expiry of ten years from the date of allotment i.e. 29th January, 2010 and 31st March, 2010 for 1334800 and 2333500 shares respectively. During the financial Year 2013-14, 133267 Preference Shares have been redeemed at a premium of Rs. 2900/- per share.

k) 25% Non Convertible Cumulative Redeemable Preference Shares of Rs. 100/- each are allotted at a price of Rs. 2500/- per share during the financial year 2010-11 on private placement basis. The preference shares are redeemable at a price that shall give aggregate yield to the holders of 1% accrued on day to day basis on the face value together with the premium of the preference shares, within 48 Months from the date of allotment i.e 28th March, 2011 in such trenches as stipulated in the subscription agreement. During the Year 400000 Preference Shares have been redeemed at a premium of Rs. 2400/- per share.

l) 4% Non Convertible Cumulative Redeemable Preference Shares of Rs. 100/- each are allotted at a price of Rs. 2500/- per share during the financial year 2010-11 on private placement basis. The Preference Shares shall be redeemed at an amount in INR, such that the subscribers get yield of 14% per annum on the amount outstanding within 36 Months from the date of allotment, i.e 29th March, 2011 in such trenches as stipulated in the subscription agreement. The same has been further extended for three months i.e upto 29th June, 2014. During the year 336751 (Previous Year 17249) Preference Shares have been redeemed at a premium of Rs. 3508.425 (Previous Year Rs. 3374.34) per share.

m) 2% 2085000 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 600/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs. 500/- per share on the expiry often years from the date of allotment.

n) 2% 1400000 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 600/- per share during the financial year 2013-14 on private placement basis. The Preference Shares are redeemable at a premium of Rs. 500/- per share on the expiry of ten years from the date of allotment.

o) 1% 1167340 Redeemable Cumulative Preference Shares of Rs. 100/- each are allotted at a price of Rs. 300/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs. 200/- per share on the expiry often years from the date of allotment.

NOTE - 5

The Company has made investment of Rs. 1000.00 Lacs in Equity Shares of Angul Sukinda Railway Limited for the construction of Rail line between Talcher Road in Angul District to Bhaguapal in Jajpur along with other parties. As the project has not made any headway the Company refused to pay the call money of Rs. 1540.00 Lacs plus interest. Angul Sukinda Railway Limited has issued final call notice for payment of unpaid call money failing which the shares are liable to be forfeited. The Company has disputed the call money which in its opinion is premature, illegal and arbitrary and has advised to withdraw said notice. Provision for diminution in the value of Investment has been made for Rs. 1000.00 Lacs (Previous Year Rs. Nil) during the year.

NOTE - 6

The Company has during the year commissioned Basic Oxygen Furnaces, Blast Furnace-II, Sinter Plant-II & III, Coke Oven-II, DRI Klins-IX &X, Lime Plants, Slab Caster-II & III and other ancillary equipments.

NOTE - 7

As per Accounting Standard (AS)-18, the disclosure of transaction with related parties as defined in the Accounting Standard are given below:

(I) List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Subsidiary companies

Bhushan Steel (Orissa) Ltd.

Bhushan Steel Madhya Bharat Ltd.

Bhushan Steel (South) Ltd.

Bhushan Steel Bengal Ltd. (upto 29.09.2013)

Parakeet Finvest Pvt. Ltd. (upto 29.09.2013)

Marsh Capital Services Pvt. Ltd. (upto 29.09.2013)

Paragon Securities Pvt. Ltd. (upto 29.09.2013)

Perpetual Securities Pvt. Ltd. (upto 29.09.2013)

Jawahar Credit & Holdings Pvt. Ltd. (upto 29.09.2013)

Bhushan Capital & Credit Services Pvt. Ltd. (upto 29.09.2013)

Bhushan Steel (Australia) PTY Ltd.

- Bowen Energy PTY Ltd., Australia

- Golden Country Resources (Australia) PTY Ltd.

- Kondor Holdings PTY Ltd.

- Bowen Coal PTY Ltd.

- Bowen Consolidated PTY Ltd.

b) Joint Venture

Andal East Coal Company Pvt. Ltd.

c) Associates

Angul Sukinda Railway Ltd.

Bhushan Energy Ltd.

Bhushan Capital & Credit Services Pvt. Ltd. (from 30.09.2013)

Jawahar Credit & Holdings Pvt. Ltd. (from 30.09.2013)

d) Key Management Personnel

Shri Neeraj Singal (Vice Chairman & Managing Director)

Shri Nittin Johari (Whole time Director)

Shri P.K. Aggarwal (Whole time Director)

Shri Rahul Sengupta (Whole time Director)

e) Relatives of Key Management Personnel

Shri B.B. Singal (Non-Executive Chairman & Father of Vice Chairman & Managing Director)

Smt. Ritu Singal (Wife of Vice Chairman & Managing Director) Brij Bhushan Singal (HUF)

f) Enterprises over which Key Management Personnel are able to exercise significant influence

Bhushan Aviation Ltd.

Bhushan Infrastructure Pvt. Ltd.

g) Enterprises over which relatives of Key Management Personnel are able to exercise significant influence

Arshiya International Ltd.

NOTE - 8

Disclosure in Respect of Material Related Party Transactions during the year :

1. Remuneration & Perks include payment to Shri Neeraj Singal Rs. 144.66 Lacs (Pre. Year Rs. 143.25 Lacs), Shri P.K.Aggarwal Rs. 75.56 Lacs (Pre.Year Rs.59.07 Lacs), Shri Nittin Johari Rs.114.40 Lacs (Pre. Year Rs. 97.16 Lacs), Shri Rahul Sengupta Rs. 75.40 Lacs (Pre. Year Rs. 59.15 Lacs), and Smt. Ritu Singal Rs. 68.60 Lacs (Pre. Year Rs. 42.96 Lacs).

2. Directors sitting fees is paid to Shri B.B.Singal Rs. 8.60 Lacs (Pre. Year Rs. 7.25 Lacs ) .

3. Investment in Share Capital/ Share Application Money include Bhushan Steel (Australia) PTY Ltd. Rs. 223.36 Lacs (Pre. Year Rs. 2088.10 Lacs), Andal East Coal Company Pvt. Ltd. Rs. 25.00 Lacs (Pre. Year Rs. 46.50 Lacs ) and Bhushan Energy Ltd. Rs. Nil (Pre. Year Rs. 24500.00 Lacs).

4. Redemption of Preference Shares under Investment include Bhushan Steel Bengal Ltd. Rs. Nil (Pre. Year Rs. 2150.00 Lacs) and Bhushan Steel (South) Ltd. Rs. Nil (Pre. Year Rs. 3000.00 Lacs).

5. Equity Share Capital received from Shri Neeraj Singal Rs. Nil (Pre. Year. Rs. 11921.47 Lacs), Shri Brij Bhushan Singal Rs. Nil (Pre. Year Rs. 6818.16 Lacs), Smt. Ritu Singal Rs. Nil (Pre. Year Rs. 734.94 Lacs), Brij Bhushan Singal (HUF) Rs. Nil (Pre. Year Rs. 1.11 Lacs) and Bhushan Infrastructure Pvt. Limited Rs. Nil (Pre Year Rs. 3086.87 Lacs) & Preference Share Capital received from Shri Brij Bhushan Singal Rs. 1329.00Lacs (Pre. Year Rs. 13200.00 Lacs), Shri Neeraj Singal Rs. 5542.02 Lacs (Pre. Year Rs. 16902.00 Lacs) and Bhushan Infrastructure Pvt. Limited Rs. 2133.00 Lacs (Pre. Year Rs. Nil).

6. Redemption of Preference Share Capital includes Bhushan Energy Limited Rs. Nil (Pre. Year Rs. 30000.00 Lacs), Shri Neeraj Singal Rs. Nil (pre. Year Rs. 11900.01 Lacs), Shri Brij Bhushan Singal Rs. Nil (Pre. Year Rs. 6800.01 Lacs) and Bhushan Infrastructure Private Limited Rs. Nil (Pre. Year Rs. 2100.00 Lacs).

7. Purchase of Goods/Services is from Arshiya International Ltd. Rs. Nil (Pre. Year Rs. 3528.12 Lacs), Bhushan Energy Ltd. Rs. 36115.80 Lacs (Pre. Year Rs. 35149.73 Lacs ) and Bhushan Aviation Ltd. Rs. 1512.00 Lacs (Pre.Year Rs. 1512.00 Lacs ).

8. Sale of Goods/Services to Bhushan Energy Ltd. Rs. 17400.09 Lacs (Pre. Year Rs. 2650.28 Lacs).

9. Security Deposit paid to Bhushan Energy Limited of Rs. 9000.00 Lacs (Pre. Year Rs. Nil).

10. Provision for diminution of investment made in case of Angul Sukinda Railway Limited amounting of of Rs. 1000.00 Lacs (Pre. Year Rs. Nil).

11. Rent Received is from Bhushan Aviation Ltd. Rs. Nil (Pre. Year Rs. 0.70 Lacs).

NOTE - 9

The Company hold 90.97% (Previous Year 90.90%) share in Bhushan Steel (Australia) Pty Ltd. Bhushan Steel (Australia) Pty Ltd. hold 100.00 % (Previous Year 100.00%) share in Bowen Energy Ltd. Bhushan Steel (Australia) Pty Ltd. has invested the amount in Bowen Energy Ltd. out of the proceeds received from its Holding Company (i.e. Bhushan Steel Limited) which are being utilized by Bowen Energy Ltd. in exploration of mines.

In Notes to Accounts on the Consolidated Financial Statements of subsidiary M/s Bowen Energy Ltd. (Australia) in the Audited Financial Statement for the year ended June'13, following notes have been given involving material items:

"The Consolidated entity has recorded a loss of $ 3,245,854 for the year ended 30 June 2013 (2012: $1,687,619) has cash outflows from operations of $1,389,919 (2012: $399,999), current liabilities of the Consolidated entity exceeded current assets by $8,350,357 (2012:$ 6,197,029) and the Consolidated entity is also in a net liability position of $4,423,581 (2012:$ 1,165,594).

To ensure the ongoing viability of the consolidated entity the directors have negotiated a $10m loan facility with Bhushan Steel (Australia) Pty Limited a wholly owned subsidiary of Bhushan Steel Limited, the parent entity of Bowen Energy Limited. At the reporting date the consolidated entity had drawn down $6.9m of this loan. The Directors believe that taking into consideration the minimum required expenditure to maintain title to existing exploration licences, current levels of administrative expenditure, the available loan facility, assuming funding is made available under the terms and conditions of the loan, will be sufficient to ensure that the Consolidated entity is able to settle its liabilities as they fall due in the ordinary course of business. Bhushan Steel (Australia) Pty Limited has also agreed not to recall payment of the loan payable by the consolidated entity until such time the consolidated entity has surplus cash. On this basis the financial report has been prepared on the going concern basis".

The loss, including impairment loss, shown in Balance Sheet of the Bowen Energy Ltd., Australia as mentioned in the above note, consist mainly expenditure incurred by the Company on exploration activity of its various mines which are still not operational, however, in accordance with generally accepted accounting principles in India, the same has been treated as Capital work in progress.

In the opinion of the company's management, the note given by the auditors of Bowen Energy Ltd., Australia is not applicable as loss, other than tenements written off, has been capitalized to CWIP in the consolidated Balance Sheet of Bhushan Steel Ltd as per generally accepted accounting principles in India.

The Company in respect of Khopoli unit has opted "Deferral Scheme" of sales tax and paid VAT on the basis of Net Present Value (NPV).

Tax difference between the amount payable and amount paid under NPV, amounting to Rs. 270.10 Lacs (Previous Year Rs. 4390.27 Lacs), being capital receipt, has been credited to Capital reserve.

NOTE - 10

The Company has elected to account for exchange differences arising on reporting of long-term foreign currency monetary item in accordance with Companies (Accounting Standards) Amendment Rules 2009 pertaining to Accounting Standard (AS)-ll notified by Government of India on 31st March, 2009 (As amended on 29th December, 2011) which allows foreign exchange differences on long-term monetary items arising on or after 1st April, 2011 to be capitalized to the extent they relate to acquisition of depreciable assets and in other cases to amortise over the balance period of the respective monetary items.

NOTE - 11

Though there is no profit for distribution of dividend, the Company has during the year redeemed 4,00,000 25% Non Convertible Cumulative Redeemable Preference Shares of Rs. 100/- each and 3,36,751 4% Non Convertible Cumulative Redeemable Preference Shares of Rs. 100/- each issued to banks and as per terms of issue of Preference Shares and paid dividend of Rs. 5.13 Lacs as approved by Board of Directors.

NOTE - 12

Pursuant to Companies Act 2013 (the Act), becoming effective from 1 April, 2014, the company has re-worked depreciation with reference to the estimated useful lives of fixed assets prescribed under Schedule II to the Act or Useful life of fixed assets as per technical evaluation. As a result the charge for depreciation is lower by Rs. 35627.18 Lacs for the year ended 31 March, 2015.

Subsequent to Notification GSR627 (E) dated 29th August, 2014 amending para 7 (b) under schedule II of the Company's Act 2013, Company has charged off transitional provision amounting to Rs. 250.34 Lacs, net of depreciation capitalized, to Statement of Profit and Loss.

NOTE - 13

The Supreme Court of India, vide its order dated 24/09/2014, cancelled number of coal blocks allocated to various entities which includes one coal block allocated to the company and one of its associated company which were under development. Subsequently, the Government of India has issued the Coal Mines (Special Provision) Act, 2015, which inter-alia deal with the payment of compensation to the effected parties in regard to investment in coal blocks.

No effect has been taken on the value of investment made by the company in the de-allocated coal blocks amounting to Rs. 56289.96 Lacs (including Expenditure incurred of Rs. 13546.46 Lacs and Advances given Rs. 42743.50 Lacs) and Rs. 666 Lacs in Equity Shares/ advance for share capital in the associated company whose coal blocks have been de-allocated. In the opinion of the management the Company/ associated company will receive back the payments/ expenditure paid/ made, including borrowing cost and other incidental expenditure, relating to de-allocated coal blocks.

NOTE - 14

In accordance with Reserve Bank of India (RBI) Circular No. 2014-15/354 Dt. 15th December, 2014 allowing flexible structuring of existing project loans (with option of periodic refinancing) to operational infrastructure/core industries projects the consortium of banks with SBI as the lead bank has allowed flexible structuring of long term loans under "5/25" scheme by aligning their debt repayment obligations with cash flow generated during their economic life.

The steering committee and joint lenders forum have approved long term viability and have structured the debt in accordance with extant guidelines of RBI. Rupee term loans are structured into loans with twenty five year tenor. Lenders are in the process of obtaining sanctions for the implementation of the long term viability plan from their respective authorities. The proposed long term viability plan has also been approved by the independent evaluation committee (IEC) constituted under RBI Guideline, held on 20/03/2015. In view of the approval of the scheme, but pending sanctions by the lender banks, the company has classified long term borrowings maturity period in accordance with the scheme considered and approved by Joint Lenders Forum (JLF).

NOTE - 15

M/s Mehrotra & Mehrotra, Chartered Accountants, New Delhi were appointed as joint statutory auditors by the shareholders through postal ballot and e-voting as per notice dated 14.02.2015 on the recommendation of Audit Committee and the Board of Directors. They have audited the Standalone and Consolidated Financial Statements comprising Balance Sheet as at 31st March, 2015 and Statement of Profit and Loss and Cash Flow Statement for the year then ended and summary of significant accounting policies and other explanatory information.

NOTE - 16

Due to the loss incurred during the year, the Company has applied to the Central Government for the approval of managerial remuneration paid during the year. The approval from Central Government is still awaited. Hence, remuneration paid is subject to approval of Central Government.

NOTE - 17

The Company has sold assigned and transferred to the purchaser in perpetuity, all rights, titles and interest in the equipments of Oxygen Plant, free and clear of encumbrances, on an itemized asset sale basis, for a consideration of Rs. 100012.50 Lacs including sales tax.

The said equipments are taken by the Company under operating lease for a period of ten years from 26th February, 2015.

NOTE - 18

Remittance in foreign currency on account of Dividend

The Company has paid dividend in respect of shares held by Non-Residents on repatriation basis. This inter-alia includes portfolio investment and direct investment, where the amount is also credited to Non-Resident External Account (NRE A/c). The total amount remittable in this respect is given herein below :

NOTE - 19

Previous Year Figures have been rearranged/regrouped wherever considered necessary.


Mar 31, 2014

(Rs in Lacs) Current Previous Year Year

NOTE - 1

1. Contingent Liabilities in respect of :

a) Sales Tax 20626.34 3629.42

b) excise Duty/Custom/Service Tax 33524.86 26114.04

c) entry tax 26506.22 17285.93

d) income tax 6115.58 40.90

e) Bills Discounted 14413.38 18225.71

f) Others 4956.54 2917.44

2. Capital Commitment

estimated amount of contracts remaining to be executed on capital account and not provided for Rs.188494.42 Lacs (Previous Year Rs.308977.52 Lacs) (Net of Advances).

3. Other Commitment

a) Outstanding guarantees issued by the banks Rs.374156.06 Lacs (Previous Year Rs.69200.64 Lacs) counter guaranteed by the company including letter of credits issued.

b) The Company from time to time provides need based support to its subsidiary Bowen energy PTY Limited (Australia) towards capital and other requirements.

c) Commitment for partly paid equity shares of Angul Sukinda Railway Limited, an associate company Rs.7400.00 Lacs (Previous Year Rs.7400.00 Lacs).

NOTE – 2

There is no present obligation arising from past events requiring provision in accordance with the guiding principle as enunciated in Accounting Standard (AS)- 29, as it is not probable that an outflow of resources embodying economic benefit will be required.

NOTE – 3

a) In terms of letter of offer dated January 9, 2013 the company had during the financial year 2012-13 allotted 14157220 equity shares of Rs.2/- each at a premium of Rs.333/- per share which were partly paid-up to the extent of Rs.167.50 (comprising Rs.1/- per equity Share towards share capital and Rs.166.50 per equity Share as share premium) on Right basis in the ratio of 1 share for every 15 shares held by the shareholders.

The Company has during the year received Rs.167.50 per equity Share (comprising Rs.1/- per equity Share towards share capital and Rs.166.50 per equity Share as share premium) on account of frst and final call money on 14156436 equity Shares and 784 equity Shares have been forfeited for non payment of First & Final Call Money. The new allotted shares rank pari passu in all respect with the existing equity shares of the Company. The proceeds from Right Issue have been utilized for repayment of indebtedness and General Corporate purpose as per the object of the Right Issue.

b) 10% 723400 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- per share on the expiry of ten years from the date of allotment.

c) 10% 1276700 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2012-13 on private placement basis against the share application money received during the financial year 2011-12 amounting to Rs.38301.00 Lacs. The Preference Shares are redeemable at a premium of Rs.2900/- per share on or before the expiry of ten years from the date of allotment i.e. 1st March, 2013.

d) 10% 333400 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2012-13 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- per share on or before the expiry of ten years from the date of allotment i.e. 25th March, 2013.

e) 10% 366667 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2011-12 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- in two equal instalments at the end of 3rd and 4th year i.e. on 4th March, 2015 and 4th March, 2016 respectively.

f) 10% 460000 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares will be redeemed at any time within a period of ten years from the date of allotment i.e. 29th March, 2012.

g) 10% 1800000 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2400/- before the expiry of ten years from the date of allotment i.e. 30th March, 2012. During the Year 1200000 Preference Shares have been redeemed at a premium of Rs.2400/- per share.

h) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2010- 11 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 30th March, 2011 for 1500300 shares. During the Year 560067 Preference Shares have been redeemed at a premium of Rs.2900/- per share.

i) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2009- 10 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 29th January, 2010 and 31st March, 2010 for 1334800 and 2333500 shares respectively. During the Year 133267 Preference Shares have been redeemed at a premium of Rs.2900/- per share.

j) 25% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2010-11 on private placement basis. The preference shares are redeemable at a price that shall give aggregate yield to the holders of 1% accrued on day to day basis on the face value together with the premium of the preference shares, within 48 Months from the date of allotment i.e 28th March, 2011 in such trenches as stipulated in the subscription agreement .

k) 4% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2010-11 on private placement basis. The Preference Shares shall be redeemed at an amount in INR, such that the subscribers get yield of 14% per annum on the amount outstanding within 36 Months from the date of allotment, i.e 29th March, 2011 in such trenches as stipulated in the subscription agreement. The same has been further extended for three months i.e upto 29th June, 2014. During the year 17249 (Previous Year 45000) Preference Shares have been redeemed at a premium of Rs.3374.34 (Previous Year Rs.2986.825) per share.

l) 2% 1400000 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.600/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs.500/- per share on the expiry of ten years from the date of allotment.

NOTE – 4

The Company has made investment of Rs.1000.00 Lacs in equity Shares of Angul Sukinda Railway Limited for the construction of Rail line between Talcher Road in Angul District to Bhaguapal in Jajpur along with other parties. As the project has not made any headway the Company refused to pay the call money of Rs.1540.00 Lacs plus interest. Angul Sukinda Railway Limited has issued final call notice for payment of unpaid call money failing which the shares are liable to be forfeited. The Company has disputed the call money which in its opinion is premature, illegal and arbitrary and has advised to withdraw said notice. Hence, no effect of the same has been

taken into books of account. The company however proposes to go for arbitration and hopes to recover back the amount, hence no impairment in the value of shares has been considered.

NOTE – 5

a) The Company has during the year commissioned Narrow Cold Rolling Mill, Mill two of API Plant, 32 MW Power Plant and other ancillary equipments and discarded the Wire Rod Mill.

b) On November 13, 2013 an explosion occurred in the slag pit during trial run of the 2nd Blast Furnace in the plant situated at Meramandali, Orissa. Due to which the operation of the Blast Furnace remain suspended resulting in loss of production and consequential loss to the Company. The Blast Furnace, Sinter Plant, Oxygen Plant, Caster, Basic Oxygen Furnace and other ancillary equipments has been put to use on 5th May, 2014.

NOTE – 6

As per Accounting Standard (AS)-18, the disclosure of transaction with related parties as Defined in the Accounting Standard are given below :

(I) List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Subsidiary companies

Bhushan Steel (Orissa) Ltd. Bhushan Steel Madhya Bharat Ltd. Bhushan Steel (South) Ltd. Bhushan Steel Bengal Ltd. (upto 29.09.2013) Parakeet Finvest Pvt. Ltd. (upto 29.09.2013) Marsh Capital Services Pvt. Ltd. (upto 29.09.2013) Paragon Securities Pvt. Ltd. (upto 29.09.2013) Perpetual Securities Pvt. Ltd. (upto 29.09.2013) Jawahar Credit & Holdings Pvt. Ltd. (upto 29.09.2013) Bhushan Capital & Credit Services Pvt. Ltd. (upto 29.09.2013) Bhushan Steel (Australia) PTY Ltd. - Bowen energy PTY Ltd., Australia

- Kondor Holdings PTY Ltd.

- Bowen Coal PTY Ltd.

- Bowen Consolidated PTY Ltd.

- Golden Country Resources (Australia) PTY Ltd.

b) Joint Venture

Andal east Coal Company Pvt. Ltd.

c) Associates

Angul Sukinda Railway Ltd.

Bhushan energy Ltd.

Bhushan Capital & Credit Services Pvt. Ltd. (from 30.09.2013)

Jawahar Credit & Holdings Pvt. Ltd. (from 30.09.2013)

d) Key Management Personnel

Shri Neeraj Singal (Vice Chairman & Managing Director) Shri Nittin Johari (Whole time Director) Shri P.K. Aggarwal (Whole time Director) Shri Rahul Sengupta (Whole time Director)

e) Relatives of Key Management Personnel

Shri B.B. Singal (Chairman & Father of Vice Chairman & Managing Director)

Smt. Ritu Singal (Wife of Vice Chairman & Managing Director)

Brij Bhushan Singal (HuF)

f) Enterprises over which Key Management Personnel and their relatives are able to exercise significant infuence

Arshiya International Ltd.

Bhushan Aviation Ltd.

Bhushan Infrastructure Pvt. Ltd.

Disclosure in Respect of Material Related Party Transactions during the year :

1. Remuneration & Perks include payment to Shri Neeraj Singal Rs.143.25 Lacs (Pre. Year Rs.140.56 Lacs), Shri P.K.Aggarwal Rs.59.07 Lacs (Pre.Year Rs.50.49 Lacs), Shri Nittin Johari Rs.97.16 Lacs (Pre. Year Rs.86.40 Lacs), Shri Rahul Sengupta Rs.59.15 Lacs (Pre. Year Rs.50.40 Lacs) and Smt. Ritu Singal Rs.42.96 Lacs (Pre. Year Rs.36.07 Lacs).

2. Directors sitting fees is paid to Shri B.B.Singal Rs.7.25 Lacs (Pre. Year Rs.7.65 Lacs).

3. Investment in Share Capital/ Share Application Money include Bhushan Steel (Australia) PTY Ltd. Rs.2088.10 Lacs (Pre. Year Rs.9496.86 Lacs), Andal east Coal Company Pvt. Ltd. Rs.46.50 Lacs (Pre. Year Rs.37.00 Lacs ) and Bhushan energy Ltd. Rs.24500.00 Lacs (Pre. Year Rs.Nil).

4. Redemption of Preference Shares under Investment include Bhushan Steel Bengal Ltd. Rs.2150.00 Lacs (Pre. Year Rs.Nil) and Bhushan Steel (South) Ltd. Rs.3000.00 Lacs (Pre. Year Rs.Nil).

5. equity Share Capital received from Shri Neeraj Singal Rs.11921.47 Lacs (Pre. Year. Rs.11921.47 Lacs), Shri Brij Bhushan Singal Rs.6818.16 Lacs (Pre. Year Rs.6818.16 Lacs), Smt. Ritu Singal Rs.734.94 Lacs (Pre. Year Rs.734.94 Lacs), Brij Bhushan Singal (HuF) Rs.1.11 Lacs (Pre. Year Rs.1.11 Lacs) and Bhushan Infrastructure Pvt. Limited Rs.3086.87 Lacs (Pre Year Rs.3086.87 Lacs) & Preference Share Capital received from Shri Brij Bhushan Singal Rs.13200.00 Lacs (Pre. Year Rs.Nil) and Shri Neeraj Singal Rs.16902.00 Lacs (Pre. Year Rs.Nil).

6. Redemption of Preference Share Capital includes Bhushan energy Limited Rs.30000.00 Lacs (Pre. Year Rs.Nil), Shri Neeraj Singal Rs.11900.01 Lacs (pre. Year Rs.Nil), Shri Brij Bhushan Singal Rs.6800.01 Lacs (Pre. Year Rs.Nil) and Bhushan Infrastructure Private Limited Rs.2100.00 Lacs (Pre. Year Rs.Nil).

7. Purchase of Goods/Services is from Arshiya International Ltd. Rs.3528.12 Lacs (Pre. Year Rs.8535.75 Lacs), Bhushan energy Ltd. Rs.35149.73 Lacs (Pre. Year Rs.62308.32 Lacs ) and Bhushan Aviation Ltd. Rs.1512.00 Lacs (Pre.Year Rs.1425.85 Lacs ).

8. Sale of Goods/Services to Bhushan energy Ltd. Rs.2650.28 Lacs (Pre. Year Rs.9859.45 Lacs).

9. Rent Received is from Bhushan Aviation Ltd. Rs.0.70 Lacs (Pre. Year Rs.1.20 Lacs).

NOTE – 6

The Company has an Indian Joint Venture with Andal east Coal Company Pvt. Ltd. having sharing of 33.33%. Its proportionate share in the Assets, Liabilities, Income and expenditure of the Joint Venture as per unaudited financial statement is as under :-

NOTE – 7

The Company hold 90.90% (Previous Year 89.95%) share in Bhushan Steel (Australia) Pty Ltd. Bhushan Steel (Australia) Pty Ltd. hold 100.00 % (Previous Year 100.00%) share in Bowen energy Ltd. Bhushan Steel (Australia) Pty Ltd. has invested the amount in Bowen energy Ltd. out of the proceeds received from its Holding Company (i.e. Bhushan Steel Limited) which are being utilized by Bowen energy Ltd. in exploration of mines.

In Notes to Accounts on the Consolidated Financial Statements of subsidiary M/s Bowen Energy Ltd.(Australia), following notes have been given involving material items:

"The Consolidated entity has recorded a loss of $ 3,245,854 for the year ended 30 June 2013 (2012: $1,687,619) has cash outflows from operations of $1,389,919 (2012: $399,999), current liabilities of the Consolidated entity exceeded current assets by $8,350,357 (2012:$ 6,197,029) and the Consolidated entity is also in a net liability position of $4,423,581 (2012:$ 1,165,594).

To ensure the ongoing viability of the consolidated entity the directors have negotiated a $10m loan facility with Bhushan Steel (Australia) Pty Limited a wholly owned subsidiary of Bhushan Steel Limited, the parent entity of Bowen energy Limited. At the reporting date the consolidated entity had drawn down $6.9m of this loan. The Directors believe that taking into consideration the minimum required expenditure to maintain title to existing exploration licences, current levels of administrative expenditure, the available loan facility, assuming funding is made available under the terms and conditions of the loan, will be suffcient to ensure that the Consolidated entity is able to settle its liabilities as they fall due in the ordinary course of business. Bhushan Steel (Australia) Pty Limited has also agreed not to recall payment of the loan payable by the consolidated entity until such time the consolidated entity has surplus cash. On this basis the financial report has been prepared on the going concern basis".

The loss, including impairment loss, shown in Balance Sheet of the Bowen energy Ltd., Australia as mentioned in the above note, consist mainly expenditure incurred by the Company on exploration activity of its various mines which are still not operational, however, in accordance with generally accepted accounting principles in India, the same has been treated as Capital work in progress.

In the opinion of the company''s management, the note given by the auditors of Bowen energy Ltd., Australia is not applicable as loss, other than tenements written off, has been capitalized to CWIP in the consolidated Balance Sheet of Bhushan Steel Ltd as per generally accepted accounting principles in India.

NOTE – 8

The Company is engaged in the steel business, which in the context of Accounting Standard (AS)-17 is considered the only primary business segment.

Gross Revenue excluding export incentives of the company as per Geographical Segment is as follows:

NOTE – 9

The Company in respect of Khopoli unit has opted "Deferral Scheme" of sales tax and paid VAT on the basis of Net Present Value (NPV).

Tax difference between the amount payable and amount paid under NPV, amounting to Rs.4390.27 Lacs (Previous Year Rs.6036.54 Lacs), being capital receipt, has been credited to Capital reserve.

NOTE – 10

The Company has elected to account for exchange differences arising on reporting of long-term foreign currency monetary item in accordance with Companies (Accounting Standards) Amendment Rules 2009 pertaining to Accounting Standard (AS)-11 notifed by Government of India on 31st March, 2009 (As amended on 29th December, 2011) which allows foreign exchange differences on long-term monetary items arising on or after 1st April, 2011 to be capitalized to the extent they relate to acquisition of depreciable assets and in other cases to amortise over the balance period of the respective monetary items.

As on 31st March, 2014, a debit of Rs.Nil (Pre. Year Rs.Nil) remains to be amortised in the "Foreign Currency Monetary Item Translation Difference Account".

NOTE – 11

The company has not entered into any finance / operating lease during the year.

NOTE – 12 DERIVATIVES

I The company has not entered into any derivatives instruments to hedge the foreign currency contracts. There is no derivative contract outstanding as on the date of the Balance Sheet.

II The year end foreign currency exposure that have not been hedged by a derivative instrument or otherwise are given below :-

NOTE – 13

As per Accounting Standard (AS) -15 "employee benefits", the disclosure of employee benefits as Defined in the Accounting Standards are given below:-

A. Defined Contribution Plans:

Contribution to Defined contribution plan, recognized as expenses / pre-operative expenses is as under:

B. Defined benefit Plans:

a) Leave encashment/ Compensated Absence.

b) Contribution to Gratuity Funds - employee''s Gratuity Fund.

In accordance with Accounting Standard (AS) - 15 (Revised 2005), the actuarial valuation carried out in respect of the aforesaid Defined benefit plans is based on the following assumptions:

NOTE – 14

Remittance in foreign currency on account of Dividend

The Company has paid dividend in respect of shares held by Non-Residents on repatriation basis. This inter-alia includes portfolio investment and direct investment, where the amount is also credited to Non-Resident external Account (NRe A/c). The total amount remittable in this respect is given herein below.


Mar 31, 2013

(Rs. in Lacs)

Current Previous Year Year

NOTE - 1

1. Contingent Liabilities in respect of:

a) Sales Tax 3629.42 3405.26

b) Excise Duty/Custom/Service Tax 26114.04 25400.98

c) Entry Tax 17285.93 10858.85

d) Income Tax 40.90 804.21

e) Bills Discounted 18225.71 12508.43

f) Others 2917.44 1867.85

2. Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for: Rs.308977.52 Lacs (Previous Year Rs.591617.15 Lacs) (Net of Advances).

3. Other Commitment

a) Outstanding guarantees issued by the banks Rs.69200.64 Lacs (Previous Year Rs.21036.75 Lacs) counter guaranteed by the company including letter of credits issued.

b) The Company from time to time provides need based support to its subsidiary Bowen Energy Limited (Australia) towards capital and other requirements.

c) The Company has given undertaking to Bhushan Energy Limited, associate company, to provide the necessary fund required to acquire Equity Shares of Orissa Sponge Iron and Steel Limited on open offer upto the limit of Rs. Nil (Previous Year Rs.21960.00 Lacs), by subscribing to the share capital of the company.

d) Commitment for partly paid equity shares of Angul Sukinda Railway Limited, an associate company Rs.7400.00 Lacs (Previous Year Rs. Nil).

NOTE - 2

There is no present obligation arising from past events requiring provision in accordance with the guiding principle as enunciated in Accounting Standard (AS)- 29, as it is not probable that an outflow of resources embodying economic benefit will be required.

NOTE - 3

a) In terms of letter of offer dated January 9, 2013 the Company has during the year allotted 14157220 Equity shares of Rs.2/- each at a premium of Rs.333/- per share which are partly paid-up to the extent of Rs.167.50 (comprising Rs.1/- per Equity Share towards share capital and Rs.166.50/- per Equity Share as share premium) on Right basis in the ratio of 1 share for every 15 shares held by the shareholders. The new allotted shares rank pari passu in all respect with the existing Equity shares of the Company. The proceeds from Right issue have been utilized for repayment of indebtedness and General Corporate purpose and pending utilization, the balance have been temporarily used to reduce the exposure of working capital borrowing from banks, which will be redrawn as and when necessary to meet the obligation as per the object of the Right Issue.

b) 10% 1276700 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the year on private placement basis against the share application money received during the previous year amounting to Rs.38301.00 Lacs. The Preference Shares are redeemable at a premium of Rs.2900/- per share on or before the expiry of ten years from the date of allotment i.e. 1st March, 2013.

c) 10% 333400 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- per share on or before the expiry of ten years from the date of allotment i.e. 25th March, 2013.

d) 10% 366667 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2011-12 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- in two equal instalments at the end of 3rd and 4th year i.e. on 4th March, 2015 and 4th March, 2016 respectively.

e) 10% 460000 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares will be redeemed at any time within a period of ten years from the date ofallotment i.e. 29th March, 2012.

f) 10% 1800000 Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2011-12 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2400/- before the expiry often years from the date ofallotment i.e. 30th March, 2012.

g) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2010-11 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 30th March, 2011 for 1500300 shares.

h) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the financial year 2009-10 on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 29th January, 2010 and 31st March, 2010 for 1334800 and 2333500 shares respectively.

i) 25% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2010-11 on private placement basis. The preference shares are redeemable at a price that shall give aggregate yield to the holders of 1% accrued on day to day basis on the face value together with the premium of the preference shares, within 48 Months from the date of allotment i.e 28th March, 2011 in such trenches as stipulated in the subscription agreement.

j) 4% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the financial year 2010-11 on private placement basis. The Preference Shares shall be redeemed at an amount in INR, such that the subscribers get yield of 11.7% per annum on the amount outstanding within 36 Months from the date of allotment, i.e 29th March, 2011 in such trenches as stipulated in the subscription agreement. During the year 45000 Preference Shares have been redeemed at a premium of Rs.2986.825/- per share.

NOTE - 4

The Company has made investment of Rs.1000.00 Lacs in Equity Shares of Angul Sukinda Railway Limited for the construction of Rail line between Talcher Road in Angul District to Bhaguapal in Jajpur along with other parties. As the project is not made any headway the Company refused to pay the call money of Rs.1540.00 Lacs plus interest. Angul Sukinda Railway Limited has issued final call notice for payment of unpaid call money failing which the shares are liable to be forfeited. The Company has disputed the call money which in its opinion is premature, illegal and arbitrary and has advised to withdraw said notice. Hence, no effect of the same has been taken into books of account.

NOTE - 5

The Company has during the year commissioned Cold Rolling & Galvanized Plane Mill and other ancillary equipments.

NOTE - 6

As per Accounting Standard (AS)-18, the disclosure of transaction with related parties as defined in the Accounting Standard are given below:

(I) List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Subsidiary companies

Bhushan Steel (Orissa) Ltd.

Bhushan Steel Madhya Bharat Ltd.

Bhushan Steel (South) Ltd.

Bhushan Steel Bengal Ltd.

Parakeet Finvest Pvt. Ltd. (from 25th January, 2012)

Marsh Capital Services Pvt. Ltd. (from 25th January, 2012) Paragon Securities Pvt. Ltd. (from 25th January, 2012) Perpetual Securities Pvt. Ltd. (from 25th January, 2012) Jawahar Credit & Holdings Pvt. Ltd. (from 29th February, 2012)

Bhushan Capital & Credit Services Pvt. Ltd. (from 29th February, 2012)

Bhushan Steel Global FZE (Upto 7th May, 2011)

Bhushan Steel (Australia) PTY Ltd.

- Bowen Energy Ltd., Australia

- Kondor Holdings PTY Ltd.

- Bowen Coal PTY Ltd.

- Bowen Consolidated PTY Ltd.

- Capricorn Metals Ltd. (Deregistered w.e.f. 4th April, 2011)

- Capricorn Resources (Australia) Ltd. (Deregistered w.e.f. 4th April, 2011)

- Golden Country Resources (Australia) PTY Ltd.

b) Joint Venture

Andal East Coal Company Pvt. Ltd.

c) Associates

Bhushan Energy Ltd.

Angul Sukinda Railway Ltd.

d) Key Management Personnel

Shri Neeraj Singal (Vice Chairman & Managing Director)

Shri Nittin Johari (Whole time Director)

Shri P.K. Aggarwal (Whole time Director)

Shri Rahul Sengupta (Whole time Director)

e) Relatives of Key Management Personnel

Shri B.B. Singal (Chairman & Father of Vice Chairman & Managing Director)

Smt. Ritu Singal (Wife of Vice Chairman & Managing Director)

Smt. Pushpa Garg

Brij Bhushan Singal (HUF)

f) Enterprises over which Key Management Personnel and their relatives are able to exercise significant influence

Arshiya International Ltd.

Bhushan Aviation Ltd.

Bhushan Infrastructure Pvt. Ltd.

NOTE - 7

The Company is engaged in the steel business, which in the context of Accounting Standard (AS)-17 is considered the only primary business segment.

NOTE - 8

Fixed Assets include one cold rolling mill established in 1992 damaged in fire accident in the year 1998-99. The amount received from Insurance Company for reinstatement / repair of the mill is included in other liabilities as the matter is still sub-judice. The amount received shall be adjusted on final disposal ofthe pending suit.

NOTE - 9

The Company in respect of Khopoli unit has opted "Deferral Scheme" of sales tax and paid VAT on the basis of Net Present Value (NPV).

Tax difference between the amount payable and amount paid under NPV, amounting to Rs.6036.54 Lacs (Previous Year Rs.6030.15 Lacs), being capital receipt, has been credited to Capital reserve.

NOTE - 10

The Company has elected to account for exchange differences arising on reporting of long-term foreign currency monetary item in accordance with Companies (Accounting Standards) Amendment Rules 2009 pertaining to Accounting Standard (AS)-ll notified by Government of India on 31st March, 2009 (As amended on 29th December, 2011) which allows foreign exchange differences on long-term monetary items arising on or after 1st April, 2011 to be capitalized to the extent they relate to acquisition of depreciable assets and in other cases to amortise over the balance period ofthe respective monetary items.

As on 31st March, 2013, a debit of Rs. Nil (Pre. Year Rs. Nil) remains to be amortised in the "Foreign Currency Monetary Item Translation Difference Account".

NOTE - 11

The company has not entered into any finance / operating lease during the year.

NOTE - 12 DERIVATIVES

I The company has not entered into any derivatives instruments to hedge the foreign currency contracts. There is no derivative contract outstanding as on the date ofthe Balance Sheet.

II The year end foreign currency exposure that have not been hedged by a derivative instrument or otherwise are given below

NOTE - 13

As per Accounting Standard (AS) -15 "Employee Benefits", the disclosure of employee benefits as defined in the Accounting Standards are given below:-

A. Defined Contribution Plans:

Contribution to defined contribution plan, recognized as expenses / pre-operative expenses is as under:

B. Defined Benefit Plans:

a) Leave Encashment / Compensated Absence.

b) Contribution to Gratuity Funds - Employee''s Gratuity Fund.

In accordance with Accounting Standard (AS) -15 (Revised 2005), the actuarial valuation carried out in respect ofthe aforesaid defined benefit plans is based on the following assumptions:

NOTE - 14

Remittance in foreign currency on account of Dividend

The Company has paid dividend in respect of shares held by Non-Residents on repatriation basis. This inter-alia includes portfolio investment and direct investment, where the amount is also credited to Non-Resident External Account (NRE A/c). The total amount remittable in this respect is given herein below :

NOTE - 15

Previous Year Figures have been rearranged / regrouped wherever considered necessary.


Mar 31, 2012

Current Previous Year Year NOTE 27

1. Contingent Liabilities in respect of:

a) Sales Tax 3405.26 0.75

b) Excise Duty/Custom/Service Tax 25400.98 17573.31

c) Entry Tax 10858.85 5654.41

d) Income Tax 804.21

e) Bills Discounted 12508.43 18647.66

f) Others 1867.85

2. Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for : Rs.591617.15 Lacs (Previous Year Rs.572893.35 Lacs) (Net of Advances).

3. Other Commitment

a) Outstanding guarantees issued by the banks Rs.21036.75 Lacs (Previous Year Rs.78354.15 Lacs) counter guaranteed by the company including letter of credits issued.

b) The Company from time to time provides need based support to its subsidiary M/s Bowen Energy Ltd (Australia) towards capital and other requirements.

c) The Company has given undertaking to M/s Bhushan Energy Limited, associate company, to provide the necessary fund required to acquire Equity Shares of M/s Orissa Sponge Iron and Steel Limited on open offer upto the limit of Rs.21960 Lacs, by subscribing to the share capital of the company.

NOTE 28

There is no present obligation arising from past events requiring provision in accordance with the guiding principle as enunciated in Accounting Standard (AS) 29, as it is not probable that an outflow of resources embodying economic benefit will be required.

NOTE 29

a) 10% 366667 Redeemable Cumulative Preference Shares of Rs.100/ each are allotted at a price of Rs.3000/ per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/ in two equal instalments at the end of 3rd and 4th year i.e. on 04/03/2015 and 04/03/2016 respectively.

b) 10% 460000 Redeemable Cumulative Preference Shares of Rs.100/ each are allotted at a price of Rs.2500/ per share during the current year on private / preferential placement basis. The Preference Shares will be redeemed at any time within a period of ten years from the date of allotment i.e. 29th March, 2012.

c) 10% 1800000 Redeemable Cumulative Preference Shares of Rs.100/ each are allotted at a price of Rs.2500/ per share during the current year on private / preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2400/ before the expiry of ten years from the date of allotment i.e. 30th March, 2012.

d) 10% Redeemable Cumulative Preference Shares of Rs.100/ each are allotted at a price of Rs.3000/ per share during the financial year 201011 on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/ before the expiry of ten years from the date of allotment i.e. 30th March, 2011 for 15,00,300 shares.

e) 10% Redeemable Cumulative Preference Shares of Rs.100/ each are allotted at a price of Rs.3000/ per share during the financial year 200910 on private / preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2900/ before the expiry of ten years from the date of allotment i.e. 29th January, 2010 and 31st March, 2010 for 13,34,800 and 23,33,500 shares respectively.

f) 25% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/ each are allotted at a price of Rs.2500/ per share during the previous year on private placement basis. The preference shares are redeemable at a price that shall give aggregate yield to the holders of 1% accrued on day to day basis on the face value together with the premium of the preference shares, within 48 Months from the date of allotment i.e 28th March, 2011 in such trenches as stipulated in the subscription agreement.

g) 4% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/ each are allotted at a price of Rs.2500/ per share during the previous year on private placement basis. The Preference Shares shall be redeemed at an amount in INR , such that the subscribers get yield of 11.7% per annum on the amount outstanding within 36 Months from the date of allotment, i.e 29th March, 2011 in such trenches as stipulated in the subscription agreement.

NOTE 30

12767000 10% Non Convertible Preference Shares of Rs.100/ each at a Premium of Rs.2900 per share will be allotted in financial year 201213 against share application money pending allotment as on 31st March 2012 amounting to Rs.38301 Lacs.

NOTE 31

The Company has during the year commissioned coke oven plant and Large Dia Pipe plant and other ancillary equipments.

NOTE 33

As per Accounting Standard (AS)18, the disclosure of transaction with related parties as defined in the Accounting Standard are given below:

(I) List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Subsidiary companies

Bhushan Steel (Orissa) Ltd. (Incorporated on 27th April, 2010) Bhushan Steel Madhya Bharat Ltd. (Incorporated on 27th April, 2010) Bhushan Steel (South) Ltd. (Incorporated on 27th April, 2010) Bhushan Steel Bengal Ltd. (Incorporated on 27th April, 2010) Parakeet Finvest Pvt Ltd. (from 25th January, 2012) Marsh Capital Services Pvt Ltd. (from 25th January, 2012) Paragon Securities Pvt Ltd. (from 25th January, 2012) Perpetual Securities Pvt Ltd. (from 25th January, 2012) Jawahar Credit & Holdings Pvt Ltd. (from 29th February, 2012) Bhushan Capital & Credit Services Pvt Ltd. (from 29th February, 2012) Bhushan Steel Global FZE (Upto 7th May, 2011) Bhushan Steel (Australia) PTY Ltd. Bowen Energy Ltd., Australia

Kondor Holdings PTY Ltd.

Bowen Coal PTY Ltd.

Bowen Consolidated PTY Ltd.

Capricorn Metals Ltd. (Deregistered w.e.f. 04th April, 2011)

Capricorn Resources (Australia) Ltd. (Deregistered w.e.f. 04th April, 2011)

Golden Country Resources (Australia) PTY Ltd.

Bowen Energy (Asia) PTE Ltd. (Has been struck off).

b) Joint Venture

Andal East Coal Company Pvt. Ltd.

c) Associates

Angul Sukinda Railway Ltd. Bhushan Energy Ltd.

d) Key Management Personnel

Shri Neeraj Singal (Vice Chairman & Managing Director) Shri Nittin Johari (Whole time Director) Shri P.K. Aggarwal (Whole time Director) Shri Rahul Sengupta (Whole time Director)

e) Relatives of Key Management Personnel

Shri B.B. Singal (Chairman & Father of Vice Chairman & Managing Director) Smt. Ritu Singal (Wife of Vice Chairman & Managing Director)

f) Enterprises over which Key Management Personnel and their relatives are able to exercise significant influence

Arshiya International Ltd. Bhushan Aviation Ltd.

Disclosure in Respect of Material Related Party Transactions during the year :

1. Remuneration & Perks include payment to Shri Neeraj Singal Rs.106.93 Lacs (Pre. Year Rs.90.95 Lacs), Shri P.K.Aggarwal Rs.35.17 Lacs (Pre. Year Rs.45.14 Lacs), Shri Nittin Johari Rs.61.25 Lacs (Pre. Year Rs.55.77 Lacs), Shri Rahul Sengupta Rs.42.70 Lacs (Pre. Year Rs.41.98 Lacs) and Smt Ritu Singal Rs.32.87 Lacs (Pre. Year Rs.27.17 Lacs).

2. Directors sitting fees is paid to Shri B.B.Singal Rs.7.65 Lacs (Pre. Year Rs.5.45 Lacs)

3. Investment in Share Capital/ Share Application Money include Bhushan Steel (Australia) PTY Ltd. Rs.4133.76 Lacs (Pre. Year Rs.2026.51 Lacs), Bhushan Steel (South) Ltd Rs. Nil (Pre. Year Rs. 3005.00 Lacs), Bhushan Steel Madhya Bharat Ltd Rs. Nil (Pre. Year Rs.5.00 Lacs), Bhushan Steel (Orissa) Ltd Rs. Nil (Pre. Year Rs. 5.00 Lacs),, Bhushan Steel Bengal Ltd Rs. 2150.00 Lacs (Pre. Year Rs.5.00 Lacs) Andal East Coal Company Pvt. Ltd. Rs.412.00 Lacs (Pre. Year Rs.125.00 Lacs) and Angul Sukinda Railway Ltd. Rs. Nil (Pre. Year Rs.600.00 Lacs).

4. 10% Non Redeemable Preference Shares have been allotted to M/s Bhushan Energy Limited Rs.30000.00 Lacs (Pre. Year Rs. Nil) and Share Application Pending Allotment is received from Shri Neeraj Singal Rs.23100.00 Lacs (Pre. Year Rs. Nil) and from Sh. B.B.Singal Rs.10200.00 Lacs (Pre. Year Rs. Nil).

5. Purchase of Goods/Services is from Arshiya International Ltd. Rs.5500.16 Lacs (Pre. Year Rs.5217.80 Lacs), Bhushan Energy Ltd. Rs.62914.19 Lacs (Pre. Year Rs.40752.46 Lacs) and Bhushan Aviation Ltd. Rs.1578.39 Lacs (Pre.Year Rs.1853.04 Lacs).

6. Sale of Goods/ Services to Bhushan Steel Global FZE Rs.1650.45 Lacs (Pre. Year Rs.19703.41 Lacs) and Bhushan Energy Ltd. Rs.3973.42 Lacs (Pre. Year Rs.2166.57 Lacs).

7. Rent Received is from Bhushan Aviation Ltd. Rs.1.20 Lacs (Pre. Year Rs.1.20 Lacs).

8. Advance received for Sale of Investment is from Bhushan Energy Ltd Rs. Nil (Pre. Year Rs.1500.00 Lacs).

NOTE 35

The Company is engaged in the steel business, which in the context of Accounting Standard (AS)17 is considered the only primary business segment.

NOTE 36

Fixed Assets include one cold rolling mill established in 1992 damaged in fire accident in the year 199899. The amount received from Insurance Company for reinstatement /repair of the mill is included in other liabilities as the matter is still subjudice. The amount received shall be adjusted on final disposal of the pending suit.

NOTE 40

The Company in respect of Khopoli unit has opted "Deferral Scheme" of sales tax and paid VAT on the basis of Net Present Value (NPV).

Tax difference between the amount payable and amount paid under NPV, amounting to Rs.6030.15 Lacs (Previous Year Rs.4120.46 Lacs), being capital receipt, has been credited to Capital reserve.

NOTE 41

The Company has elected to account for exchange differences arising on reporting of longterm foreign currency monetary item in accordance with Companies (Accounting Standards) Amendment Rules 2009 pertaining to Accounting Standard (AS)ll notified by Government of India on 31st March, 2009 (As amended on 29th December, 2011) which allows foreign exchange differences on longterm monetary items arising on or after 1st April, 2011 to be capitalized to the extent they relate to acquisition of depreciable assets and in other cases to amortise over the balance period of the respective monetary items.

As on 31st March, 2012, a debit of Rs. NIL (Pre. Year Rs. Nil) remains to be amortised in the "Foreign Currency Monetary Item Translation Difference Account".

NOTE 42

The company has not entered into any finance / operating lease during the year.

NOTE 43 DERIVATIVES

I The company has not entered into any derivatives instruments to hedge the foreign currency contracts. There is no derivative contract outstanding as on the date of the Balance Sheet.

NOTE 50

Previous Year Figures have been rearranged/regrouped wherever considered necessary.


Mar 31, 2011

(Rs. in Lacs)

Current Year Previous Year

1. Contingent Liabilities in respect of:

a) Sales Tax 0.75 0.75

b) Excise Duty/Service Tax 17573.31 4.95

c) Entry Tax 5654.41 -

d) Outstanding guarantees issued by the banks counter guaranteed by the company including letter of credits 78354.15 79395.10

e) Bills Discounted 18647.66 11524.91

2. Estimated amount of contracts remaining to be executed on capital account and not provided for :Rs.572893.35 Lacs ( Previous Year Rs.393176.57 Lacs) (Net of Advances).

3 There is no present obligation arising from past events requiring provision in accordance with the guiding principle as enunciated in Accounting Standard (AS)- 29, as it is not probable that an outflow of resources embodying economic benefit will be required.

4. a) 25% Non Convertible Cumulative Redeemable Preference Shares of X100/- each are allotted at a price of Rs.2500/- per share during the year on private placement basis. The preference shares are redeemable at a price that shall give aggregate yield to the holders of 1 % accrued on day to day basis on the face value together with the premium of the preference shares, within 48 Months from the date of allotment i.e 28th March, 2011 in such trenches as stipulated in the subscription agreement.

b) 4% Non Convertible Cumulative Redeemable Preference Shares of Rs.100/- each are allotted at a price of Rs.2500/- per share during the year on private placement basis. The Preference Shares shall be redeemed at an amount in INR , such that the subscribers get yield of 11.7% per annum on the amount outstanding within 36 Months from the date of allotment, i.e 29th March, 2011 in such trenches as stipulated in the subscription agreement.

c) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the year on private placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 30th March, 2011 for 15,00,300 shares .

d) 10% Redeemable Cumulative Preference Shares of Rs.100/- each are allotted at a price of Rs.3000/- per share during the previous year on private/preferential placement basis. The Preference Shares are redeemable at a premium of Rs.2900/- before the expiry of ten years from the date of allotment i.e. 29th January, 2010 and 31 st March, 2010 for 13,34,800 and 23,33,500 shares respectively.

2 The Company has during the year commissioned 4 Kilns, Blast Furnace, Conarc Furnace, Slab Caster, Hot Rolled Mill, Railway Siding and other ancillary equipments.

3. As per Accounting Standard (AS)-l 8, the disclosure of transaction with related parties as defined in the Accounting Standard are given below : (I) List of related parties where control exists and related parties with whom transactions have taken place and relationships:

a) Subsidiary companies

Bhushan Steel (Orissa) Ltd (Incorporated on 24th May, 2010] Bhushan Steel Madhya Bharat Ltd (Incorporated on 24th May, 2010 ] Bhushan Steel (South) Ltd (Incorporated on 27th April, 2010] Bhushan Steel Bengal Ltd (Incorporated on 24th May, 2010] Bhushan Steel Global FZE Bhushan Steel (Australia) PTY Ltd.

- Bowen Energy Ltd, Australia (from 28th July, 2009) - Kondor Holdings PTY Ltd.

- Bowen Coal PTY Ltd. - Bowen Consolidated PTY Ltd.

- Capricorn Metals Ltd. - Capricorn Resources (Australia) Ltd.

- Golden Country Resources (Australia) PTY Ltd. - Bowen Energy (Asia) PTE Ltd. has been struck off.

b) Joint Venture

Andal East Coal Company Pvt. Ltd. (Incorporated on 22nd September, 2009]

c) Associates

AngulSukinda Railway Ltd. (from 27th May, 2009) Bhushan Energy Ltd. (from 2nd December, 2009]

d) Key Management Personnel

Sh. Neeraj Singal (Vice Chairman & Managing Director) Sh. P.K. Aggarwal (Whole time Director]

Sh. Nittinjohari (Whole time Director) Sh. Rahul Sen Gupta (Whole time Director]

e) Relatives of Key Management Personnel

Smt. Ritu Singal (Wife of Vice Chairman & Managing Director]

Shri B.B. Singal (Chairman & Father of Vice Chairman & Managing Director]

f) Enterprises over which Key Management Personnel and their relatives are able to exercise significant influence

Bhushan Energy Ltd. (up to 1st December, 2009) Arshiya International Ltd.

Bhushan Aviation Ltd.

4. Fixed Assets include one cold rolling mill established in 1992 damaged in fire accident in the year 1998-99. The amount received from Insurance Company for reinstatement /repair of the mill is included in other liabilities as the matter is still sub-judice. The amount received shall be adjusted on final disposal of the pending suit.

5. The Company in respect of Khopoli unit has opted "Deferral Scheme" of sales tax and paid VAT on the basis of Net Present Value (NPV).

Tax difference between the amount payable and amount paid under NPV, amounting to Rs.4120.46 Lacs (Previous Year Rs.2383.82 Lacs), being capital receipt, has been credited to Capital Reserve.

6. DERIVATIVES

I The company has not entered into any derivatives instruments to hedge the foreign currency contracts. There is no derivative contract outstanding as on the date of the Balance Sheet.

7. The company has not entered intoany finance/operating lease during the year.

8. Previous Year Figures have been regrouped wherever considered necessary.

 
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