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Notes to Accounts of Deepak Spinners Ltd.

Mar 31, 2015

1.1 Nature of Operations

The Company is a manufacturer of Synthetic Man Made Yarn. It has two spinning units at Baddi (H.P) and Guna (M.P). The company is generating electricity from it's Solar Power Plant at Rajgarh (M.P)

2 Contingent Liabilities and Commitments

A. Contingent Liabilities not provided for in respect of

i) Demand for Excise duty, being contested by the Company 43.73 43.73 (Amount deposited 9.00 lakhs, Previous year 9.00 lakhs)

ii) Demand for Income Tax, being contested by the Company 48.16 67.97 (Amount deposited Rs. 23.56 lakhs, Previous year 64.42 lakhs)

iii) Legal Cases (Employees) 3.68 3.00

iv) Demand for Cess on own generation of electricity 44.89 44.89 The management believes that the Company has a strong chance of favourable decision in above cases, hence no provision has been considered necessary.

B. Capital Commitments (Net of Advance paid) 16.83 85.91

*Power & Fuel includes Rs. 180.30 lakhs, Miscellaneous expenses includes Rs. 21.70 lakhs, Contribution to Provident and other Funds Rs. 28.41 lakhs and interest expenses includes Rs. 59.09 lakhs related to prior period but demand received during the year.

3. Related Party Disclosures as per AS-18 :

a) List of related parties and relationship

Key Management personnel & his relatives

i) Shri P. K. Daga, Chairman and Managing Director.

ii) Shri Yashwant Kumar Daga, Director (Son of Shri P. K. Daga).

iii) Shri Shantanu Daga, Senior Management Executive (Son of Shri Yashwant Kumar Daga).

b) Enterprises over which Key Management Personnel or his relatives are able to exercise significant influence

M/s. Deepak Industries Ltd.

M/s. Contransys Pvt Ltd.


Mar 31, 2014

1. Nature of Operations

The Company is a manufacturer of Synthetic Man Made Yarn. It has two spinning units at Baddi (H.P) and Guna (M.P) having capicity of 76752 Spindles. The company is generating electricity from it''s Solar Power Plant at Rajgarh (M.P)

2. Terms / Rights attached to Equity Shares

Each holder of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company. The distribution will be in proportion to the number of equity shares held by the shareholders. There is no restriction on distribution of dividend. However same other than interim dividend, is subject to the approval of the shareholders in the Annual General Meeting.

3. a Term Loan from a bank is secured by first charge on the Plant & Machineries, other movable fixed assets and extension of equitable mortgage on all immovable fixed assets and second charge on current assets of the textile business. These Loans are further secured by personal guarantee of the Chairman and Managing Director and a Director.

b Term Loan from a bank is secured by Plant & Machinery and other fixed assets and extension of equitable mortgage of the immovable fixed assets of the Solar Power Plant and second charge on current assets of the company. This Loan is further secured by personal guarantee of the Chairman and Managing Director and a Director.

c Secured by hypothecation of vehicle financed.

4. Contingent Liabilities and Commitments

As at As at A. Contingent Liabilities not 31st March, 2014 31st March, 2013 provided for in respect of (Rs. In lakhs) (Rs. In lakhs)

i) Bank Guarantee - 1.00

ii) Demand for Excise duty, being contested by the Company * 43.73 43.73 (Amount deposited Rs. 9.00 lakhs, Previous year Rs. 9.00 lakhs)

iii) Demand for Income Tax, being contested by the Company * 67.97 114.81 (Amount deposited Rs. 64.42 lakhs, Previous year Rs. 98.49 lakhs)

iv) Legal Cases (Employees) * 3.00 6.77

*The management believes that the Company has a strong chance of success in these cases, hence no provision considered necessary.

v) Demand for Cess on own generation of electricity . 62.63 40.52

B. Capital Commitments 85.91 326.49 (Net of Advance paid)

5. Segment reporting :

I) As per guidelines contain in AS 17 (Segment reporting), the company is operating in a single segment mainly in manufacture and sale of yarn.

ii) Secondary Segment is geographical Segment which includes export sales (including export incentive) Rs. 3487.00 lakhs (Previous year Rs. 3401.31 lakhs) and domestic sales Rs. 35749.61 lakhs (Previous year Rs. 27490.16 lakhs) All assets of the Company are Located in India except export debtors Rs. 201.25 lakhs (Previous year Rs. 298.94 lakhs).

6. Related Party Disclosure :

a) List of related parties and relationship

Key Management personnel & their relatives :-

i) Sh. P. K. Daga, Chairman and Managing Director

ii) Sh. Shantanu Daga, Senior Management Executive (Grand Son of Shri P. K. Daga)

iii) Sh. Yashwant Daga, Director (Son of Shri P. K. Daga)

b) Enterprises over which Key Management Personnel are able to exercise significant influence M/s. Deepak Industries Ltd.

7. Previous Year''s figures have been reclassified/regrouped to conforms current year figure.


Mar 31, 2013

1.1 Nature of Operations

The Company is a manufacturer of Synthetic Man Made Yarn, It has two spinning units at Baddi (H.P) and Guna (M.P) having capicity of 63552 Spindles. The company has started generating electricity from it''s Solar Power Plant at Rajgarh (M.P) with effect from 08th November, 2012.

1.2 Balances of debtors, creditors and others loans & advances are subject to confirmation.

1.3 Borrowing cost capitalised during the year Rs. 178.36 lakhs (Previous year Rs. 49.57 lakhs).

1.4 Segment reporting :

I) As per guidelines contain in AS 17 (Segment reporting), the company is operating in a single segment mainly in manufacture and sale of yarn.

ii) Secondary Segment is geographical Segment which includes export sales (including export incentive) Rs. 3401.31 lakhs (Previous year Rs. 4786.23 lakhs) and domestic sales Rs. 27490.16 lakhs (Previous year Rs.23282.56 lakhs ) All assets of the Company are Located in India except export debtors Rs. 298.94 lakhs (Previous year Rs.305.88 lakhs).

1.5 Related Party Disclosure :

a) List of related parties and relationship

Key Management personnel & their relatives :

i) Sh. P.K. Daga, Chairman and Managing Director

ii) Sh. Shantanu Daga, Senior Management Executive (Grand Son of Shri P. K. Daga)

iii) Sh. Yashwant Daga, Director (Son of Shri P. K. Daga)

1.6 Previous Year''s figures have been reclassified/regrouped to conforms current year figure.


Mar 31, 2012

Terms / Rights attached to Equity Shares

Each holders of equity shares is entitled to one vote per share. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company. The distribution will be in proportion to the number of equity shares held by the shareholders. There is no resctriction on distribution of dividend. However same is subject to the approval of the share holders in the Annual General Meeting.

a. Term loans from a bank are secured by first charge on present and future movable plant and machinery purchased under TUFS subject to prior charges in favour of bankers for securing working capital borrowings. These loans are further secured by personal gurantees of two directors of the company.

b. Corporate loans from Banks is secured by way of first charge on fixed assets of the Company on pari-passu basis except assets charged exclusively for term loan under TUFS. These loans are further secured by personal guarantee of two directors of the company.

c. Secured by hypothecation of vehicle financed and carries interest rate of 10.97% per annum. Payable in 48 equal monthly instalment beginning with April, 2012.

*The company has not received any information from its suppliers regarding registered under the Micro, Small and Medium Enterprises Development Act,2006. Hence, the information required to be given in accordence with section 22 of the said Act, is not ascertainable and not disclosed.

(a) The Excise duty on Finished Goods (i.e. man made synthetic yarn) was lower than on its input which has resulted in accumulation of unutilised balance in Cenvat account. From 1st March,2006 excise duty on input i.e.men made fibre has been reduced to be at par with finished goods. As on 31.03.2012 the accumulated cenvat credit balance was Rs.856.60 lakhs (Previous Year Rs. 1005.28 lakhs). Based on sale projections, the management is quite hopeful to utilise the above accumulated cenvat credit by paying duty on export goods under claim for rebate/ refund and on value addition of the yarn.

Hence in the opinion of the management at this stage, no provision is required for non usable excess cenvat credit.

1.1 Nature of Operations

The Company is a manufacturer of Synthetic Man Made Yarn. It has two spinning units at Baddi (H.P.) and Guna (M.P.).

1.2 Balances of debtors, creditors and others are subject to confirmation.

1.3 Exceptional items represents interest paid Rs.Nil (Previous Year Rs. 70.80 lakhs)

1.4 Borrowing cost capitalised during the year Rs. 49.57 lakhs (Previous year Rs. Nil)

1.5 Segment reporting :

I) As per guidelines contain in AS 17 (Segment reporting), the company is operating in a single segment mainly in manufacture and sale of yarn.

ii) Secondary Segment is geographical Segment which includes export sales (including export incentive) Rs. 4786.23 lakhs (Previous year Rs. 2450.75 lakhs) and domestic sales Rs. 23282.56 lakhs (Previous year Rs.23081.50 lakhs ) All assets of the Company are Located in India except export debtors Rs. 305.88 lakhs (Previous year Rs.248.08 lakhs).

1.6 Related Party Disclosure :

a) List of related parties and relationship

A) Subsidiary : DSL Hydrowatt Ltd.

B) Key Management personnel & their relatives :

i) Sh. P.K. Daga, Chairman and Managing Director

ii) Sh. Shantanu Daga, Senior Management Executive (Grand Son of Shri P. K. Daga)

1.7 The Company has prepared current year account as per presentation and disclosure requirement of Revised Schedule Vi to the Companies Act, 1956 applicable with effect from 1st April 2011. Previous Year's figures have been reclassified/regrouped to conforms current year figure.

Signature to notes 1 to 27.17

 
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