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Notes to Accounts of Diamant Infrastructure Ltd.

Mar 31, 2014

Note - 1 Segment information

The Company has identified business segments as its primary segment. Business segments are primarily Infrastructure and Trading. Revenues and expenses directly attributable to segments are reported under each reportable segment. Expenses which are not directly Identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as unallocable.

Note - 2 Additional information to the financial statements

Note Particulars 31st March 2014 31st March 2013 (Rs.) (Rs.)

2.1 Contingent liabilities and commitments (to the extent not provided for)

(i) Contingent liabilities

(a) Claims against the Company not acknowledged as debt Demand Notice from Sales tax (Refer Note 23.18 below) 22,00,000/- 22,00,000/- Penalty - Sales tax - on the above Not Not demand notice Determinable Determinable

(b) Guarantees

Mobilisation Bank Guarantee issued by Union Bank of India - 2,00,00,000/- During the Year bank guarantee worth of Rs. 1,50,00,000/- had been wrongly revoked by Ashoka Buildcon Ltd. And because of that the Company had issued a Legal Notice to Ashoka Buildcon Ltd. for the recovery of the same and which has been repaid by Ashoka Buildcon Ltd. during the same financial year.

(c) Performance bank Guarantee 38,50,000/- -

(Against this 25% margin money of Rs. 9,62,500/- in the form Fixed deposit with Union Bank of India has been earmarked) and the same has been Included in Note. 12

(d) Defect Liability period in respect of contracts Not Not executed Determinable Determinable

3. Fund based Cash credit facility (sanctioned amount Rs. 800 lacs), and Ad Hoc Fund Based Cash Credit of Rs 100 Lacs, non fund based Bank Guarantee Facility (sanctioned limit of Rs. 320 lacs) from Union Bank of India is secured primarily by way of hypothecation of movable current assets of the company including stock of materials, work in progress, finished goods and whole of the company''s bills outstanding, receivables, book debts and collaterally by mortgage of Flat at Mumbai and Nagpur and office premises at Nagpur in the name of the Managing Director, Mr. Naresh Saboo jointly with his wife Mrs. Madhu Saboo and pledge of 50,00,000 equity shares of Rs. 21- each of the company held by the promoter company M/s Saboo Capital and Securities Pvt Ltd and also by personal guarantee of Mr. Naresh S. Saboo, Managing Director and Madhu Saboo, wife of Managing Director and corporate guarantee by the promoter company M/s. Saboo Capital and Securities Pvt Ltd.

4. Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 Micro, Small and Medium Enterprises in terms of section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 have been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by the auditors. The Company has not received any instruction from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, disclosures if any, relating to amounts unpaid as at the yearend together with interest payable as required under the said Act have not been given.

5. The balancesappearing under unsecured loans, sundry creditors, sundry debtors, loans and advances, and certain banks are subject to confirmation and reconciliation and consequential adjustment, if any, will be accounted for in the year of confirmation and/or reconciliation

6. In the opinion of the Board, assets other than fixed assets do have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated.

7. Since the Company recognises gratuity and leave salary expense on payment basis no liability for the same has been ascertained and provided in the accounts. Hence, the company has not complied with the provisions of AS-15 "Accounting for Retirement Benefit".

8. The sales tax department in the finacial year 2011 -12, raised a demand on the company for Rs. 22,00,000/-, against which the Company has preferred an appeal against the department with the Assistant Commissioner of Sales Tax (Appeals). The company has already deposited Rs. 10,50,000/- of the demand raised under protest. Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision for the balance demand has been done.

9. The Income Tax Departnent, Mumbai has raised a Demand of Rs. 28,70,971/- U/s 143(3) for the Year 2009-10, for which the Company has preffered an Appeal which is Pending with Commissioner of Income Tax, Appeals-37, Mumbai. However, there is no Provision is made by the Company to discharge the liability. Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision for the balance demand has been done.

10. The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements for the period beginning from 1 st April 2011 by virtue of the Notification No.653 (E) dated March 30,2011. This has significantly impacted the disclosure and presentation made in the financial statements. The management has prepared the financial statements providing appropriate disclosures as required by the said revised Schedule VI and based on the various guidance notes issued in this regard. Accordingly previous year''s figures have been regrouped/reclassified and re-instated wherever necessary to correspond with the current year''s classification/disclosure as per the revised Schedule VI.


Mar 31, 2013

Note - 1 Segment information

The Company has identified business segments as its primary segment Business segments are primarily Infrastructure, Tading and Realty. Revenues and expenses directly attributable to segments are reported under each reportable segment Expenses which are not directly identifiable to each reportable segment have been allocated on the basis of associated revenues of the segment and manpower efforts. All other expenses which are not attributable or allocable to segments have been disclosed as unallocable expenses. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment All other assets and liabilities are disclosed as unallocable.

2.1 Fund based Cash credit facility (sanctioned amount Rs. 800 lacs), and Ad Hoc Fund Based Cash Credit of Rs 100 Lacs, non fund based Bank Guarantee Facility (sanctioned limit of Rs. 200 lacs) from Union Bank of India is secured primarily by way of hypothecation of movable current assets of the company including stock of materials, work in progress, finished goods and whole of the company''s bills outstanding, receivables, book debts and collaterally by mortgage of Flat at Mumbai and Nagpur and office premises at Nagpur in the name of the Managing Director, Mr. Naresh Saboo jointly with his wife Mrs. Madhu Saboo and pledge of 50,00,000 equity snares of Rs. 21- each of the company held by the promoter company M/s Saboo Capital and Securities Pvt Ltd and also by personal guarantee of Mr. Naresh S. Saboo, Managing Director and Madhu Saboo, wife of Managing Director and corporate guarantee by the promoter company M/s. Saboo Capital and Securities Pvt Ltd.

2.2 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 20O6

Micro. Small and Medium Enterprises in terms of section 22 of the Micro, Small and Medium Enterprises Development Act. 2006 have been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by the auditors. The Company has not received any instruction from suppliers regarding their status under the Micro, Small and Medium Enteiprises Development Act 2006 and hence, disclosures if any. relating to amounts unpaid as at the yearend together with interest payable as required under the said Act have not been given.

2.3 The Company in the Extra Ordinary General Meeting (EOGM) of the company held on 24th December, 2010, had approved the issue and allotment of 37,00,000/- Warrants at 140/- per warrant convertible into Equity shares of Rs. 21- each at a premium of Rs. 38/- per share in accordance with the provistonsyrf the Companies Act, 1956 and Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) RegulatK3n,%009 to promoters and non-promoters Accordingly, 25% of the total consideration of Rs. 14,80,00,000/- i. e Rs. 3,70,00,000/- has been received by the company and in-principle approval of the Mumbai Stock Exchange (BSE) for the same had also been obtained. The warrants were due for conversion into equivalent number of shares on payment of the balance amount at any time on or. before 17th July. 2012. Since, the subscribers to the preferential allotment have failed to honour their balance comitment of 75%, the company has Fortied the same and the amount of Rs 3,70,00,000/- trtansferred to Capital Reserve (Reserve & Surplus).

2.4 The balances appearing under unsecured loans, sundry creditors, sundry debtors, loans and advances, and certain banks are subject to confirmation and reconciliation and consequential adjustment if any, wB be accounted for in the year of confirmation and/ or reconciliation

2.5 In the opinion of the Board, assets other than fixed assets do have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated.

2.6 Since the Company recognises gratuity and leave salary expense on payment basis no liability for the same has been ascertained and provided in the accounts. Hence, the company has not compied with the provisions of AS-15 "Accounting for Retirement Benefit".

2.7 The sales tax department had in the previous year, raised a demand on the company for Rs. 22.00,000/-, against which the Company has preferred an appeal against the department with the Assistant Commissioner of Sales Tax (Appeals). The company has already deposited Rs. 10,50,000/- of the demand raised under protest. Based on the prevalent decisions of the appeBate authorities and the interpretations of the other relevant provisions, the company has been legaly advised that the demand is likely to be either deleted or substantially reduced and aaonJngry no provision for the balance demand has been done.

2.8 The Income Tax Departnent, Mumbai has raised a Demand of Rs. 28,70,971/- U/s 143(3) for the Year 2009-10, for which the Company has preffered an Appeal which is Pending with Commissioner of Income Tax, Appeals-37, Mumbai. However, there is no Provision is made by the Company to discharge the BaMity. Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substanu''aty reduced and accordingly no provision for the balance demand has been done.

2.9 The company has incurred a net loss of Rs. 1,77,84,464/- in Infjpsturcutre segment during the Financial Year 2012-13.

2.10 The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements for the period begiining from 1st April 2011 by virtue of the Notification No.653 (E) dated March 30, 2011. This has significantly impacted the dfedosure and presentation made in the financial statements. The manager^ has prepared the financial statements providing appropriate disclosures as required by the said revised Schedule VI and based on the various guidance notes issued in this regard. Accordingly previous year''s figures have been regrouped/reclassifted and re-instated wherever necessary to correspond with the current year''s dassifiration/disctosure as per the revised Schedule VI.


Mar 31, 2011

1. Contingent Liabilities

a) Claims against the company not acknowledged as Debts:

Demand notice from IncomeTax for Assessment Year 2003-04 (Refer Note 12 below) Rs.15,80,957/-

Penalty - Income Tax - Assessment Year 2003-04 Not determinable

Demand notice from Income Tax for Assessment Year 2008-09 Rs.3,26,676/- (Refer Note 12 below)

Penalty - Income Tax - Assessment Year 2008-09 Not determinable

Demand Notice from Sales tax (Refer Note 13 below) Rs.22,00,000/-

Sales Tax Reassessment for A.Y 2001 -02 Rs.1,64,673/-

Penalty Sales Tax Reassessment for A.Y 2001 -02 Not determinable

b) Performance Bank Guarantee issued by Union Bank of India Rs.1,50,00,000/-

c) Defect Liability period in respect of contracts executed Not determinable

2. The Company in the Extra Ordinary General Meeting (EOGM) of the company held on 24th December, 2010, approved the issue and allotment of Rs. 37,00,000/- Warrants at 7 40/- per warrant convertible into Equity shares of Rs.21- each at a premium of 7 38/- per share in accordance with the provisions of the Companies Act, 1956 and Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulation, 2009 to promoters and non-promoters Accordingly, 25% of the total consideration of Rs.14,80,00,000/- i. e Rs.3,70,00,000/- has been received by the company and in-principle approval of the Mumbai Stock Exchange (BSE) for the same is also obtained.

3. Fund based Cash credit facility (sanctioned amount Rs.700 lacs) and non fund based Bank Guarantee Facility (sanctioned limit of Rs.200 lacs) from Union Bank of India is secured primarily by way of hypothecation of movable current assets of the company including stock of materials, work in progress, finished goods and whole of the company's bills outstanding, receivables, book debts and collaterally by mortgage of Flat at Mumbai and Nagpur and office premises at Nagpur in the name of the Managing Director, Mr. Naresh Saboo jointly with his wife Mrs. Madhu Saboo and pledge of 50,00,000 equity shares of Rs.21- each of the company held by the promoter company M/s Saboo Capital and Securities Pvt Ltd and also by personal guarantee of Mr. Naresh S. Saboo, Managing Director and Madhu Saboo, wife of Managing Director and corporate guarantee by the promoter company M/s. Saboo Capital and Securities Pvt Ltd.

4. Uncertified contract revenue of Rs.84,57,414/- includes work executed by the company which has not yet been certified by the principal contractors. The management has determined the value of the uncertified revenue based on the cost incurred by the company in relation to the same.

5. Other advances includes:

- Rs.7,00,00,000/- (agreement value) advanced towards property at Pune for which the agreement for sale had been entered and registered in the name of the company. However the deed of conveyance has not been executed and hence not registered, due to Rs. 1,32,50,000/- out of the total consideration of Rs.7,00,00,000/- being outstanding to be paid by the company to the vendors on account of ongoing litigation. The outstanding amount has been fully provided for in the accounts.

- Rs.6,00,00,000/- advanced to M/s Tarangan Infraventures Pvt Ltd towards development agreement for the above mentioned Pune Property entered into by the company with M/s Tarangan Infraventures Pvt Ltd.

6. Since the Company recognises gratuity liability on payment basis, no liability for the same has been ascertained and provided in the accounts. Hence, the company has not complied with the provisions of AS-15 "Accounting for Retirement Benefits".

7. In spite of the absence of database identifying parties as Small Scale Industrial Undertakings (SSIs), it is of the opinion of the management that there are no dues payable to SSIs. The auditors have accepted the representation of the management in this regards.

8. Micro, Small and Medium Enterprises in terms of section 22 of the Micro, Small and Medium Enterprises Development Act, 2006 have been determined to the extent such parties have been identified on the basis of information available with the Company and relied upon by the auditors. The Company has not received any instruction from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, disclosures if any, relating to amounts unpaid as at the year end together with interest payable as required under the said Act have not been given.

9. The balances appearing under unsecured loans, sundry creditors, sundry debtors, loans and advances, and certain banks are subject to confirmation and reconciliation and consequential adjustment, if any, will be accounted for in the year of confirmation and/or reconciliation.

10. In the opinion of the Board, the Current Assets, Loans and Advances have value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet.

11. The disputed demand in respect of Income Tax outstanding for the Assessment Year 2003-04 is Rs.25,80,957/- against which the company has preferred an appeal against the order of the CIT (Appeals) with the Income Tax Appellate Tribunal, Mumbai. The company has already deposited Rs.12,05,990/- of the demand raised under protest. The disputed demand in respect of Income Tax outstanding for the Assessment Year 2008-09 is Rs.3,26,676/- against which the company has preferred an appeal with the CIT(Appeals), Mumbai. The company has already deposited 50% of the demand raised under protest.

Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly provision for the balance demand has not been done.

12. The sales tax department has during the year under audit, raised a demand on the company for Rs.22,00,000/-, against which the Company has preferred an appeal against the department with the Assistant Commissioner of Sales Tax (Appeals). The company has already deposited Rs.10,50,000/- of the demand raised under protest. Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision for the balance demand has been done.

13. The Company leases office under cancellable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs. 7,39,580/- and Rs.5,15,960/- during the year ended 31st March, 2011 and 2010 respectively.

14. Related party disclosures as required by AS-18 are given below

(a) List of Related Parties

Key Managerial Personnel

Naresh Saboo

Kamlesh Prasad

Devendra Balasaria

Relatives of Key Managerial Personnel

Madhoo Saboo

Santosh Saboo

Rakesh Prasad

Associated Concerns

Saboo Capital and Securities Pvt. Ltd.

Diamant Infrastructure Developers Pvt Ltd

Diamant Realty Pvt Ltd

Diamant Securities Pvt Ltd

15. The management was of the opinion that there were no impairment indicators that existed as on the balance sheet date. Hence no provision for the impairment loss has been done.

16. Previous years figures have been regrouped / re-classified in order to conform to current year's figures.

17. Balance Sheet and General Business Profile (in terms of Part IV of Schedule VI to the Companies Act, 1956) is annexed here with.


Mar 31, 2010

1. Contingent Liabilities:

Claims against the company not acknowledged as Debts Not ascertainable

Income Tax - Assessment Year 2003-04 Rs. 15,80,957/- Penalty - Income Tax - Assessment

Year 2003-04 Not determinable Defect Liability period in respect of contracts executed Not determinable

Sales Tax Reassessment for A. Y. 2001-02 Rs. 1,64,673/-

Penalty Sales Tax Reassessment for AY 2001 -02 Not determinable

2. During the year under audit, 35,95,850 equity shares of Rs. 10/- each were allotted by the company as fully paid up bonus shares in the ratio of 3 (Three) equity shares for every 1 (One) equity share held by the shareholder of the company as on the record date, by capitalisation of Rs. 3,59,58,500/- from the available free reserves pursuant to resolution passed by the members at the Extra Ordinary General Meeting (EOGM) of the Company held on 25th January, 2010.

3. At the Extra Ordinary General Meeting (EOGM) of the company on 8th March, 2010, members passed a resolution to issue 22,45,000/- equity shares of Rs. 10/- each for cash at a premium of Rs. 30/- per equity share, aggregating to Rs. 8,98,00,000/- in accordance with the provisions of the Companies Act, 1956 and Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulation, 2009 to non-promoters. Accordingly, the in-principle approval of the Mumbai Stock Exchange (BSE) was obtained and the allotment of shares was done on the 12th March, 2010.

4. Cash credit facility from Union Bank of India (sanctioned amount Rs. 400 lacs) is secured primarily by way of hypothecation of book debts and moveable stock in the form of Work In Progress and collaterally by mortgage of Flat at Mumbai and Nagpur in the name of the Managing Director, Mr. Naresh Saboo jointly with his wife Mrs. Madhu Saboo and pledge of 2,50,000 shares of the company held by the promoter company M/ s Saboo Capital and Securities Pvt Ltd and also by personal guarantee of the promoter company M/s. Saboo Capital and Securities Pvt Ltd, Mr. Naresh S. Saboo, Managing Director, Naresh Jain, Director, and Madhu Saboo, wife of Managing Director.

5. Uncertified contract revenue of Rs. 44,36,838/- includes work executed by the company which has not yet been certified by the principal contractors. The management has determined the value of the uncertified revenue based on the cost incurred by the company in relation to the same.

6. Other advances includes Rs. 7,00,00,000/- (agreement value) advanced towards property at Pune for which the agreement for sale had been entered and registered in the name of the company. However the deed of conveyance has not been executed and hence not registered, due to Rs. 1,32,50,000/- out of the total consideration of Rs. 7,00,00,000/- being outstanding to be paid by the company to the vendors. The outstanding amount has been fully provided for in the accounts.

7. Since the Company recognises gratuity and leave salary expense on payment basis, no liability for the same has been ascertained and provided in the accounts. Hence, the company has not complied with the provisions of AS-15 "Accounting for Retirement Benefit".

8. During the Year, a sum of Rs. Nil/- (Previous year Rs. 37,790/-) being interest till the date the asset is put to use on borrowings attributable to qualifying assets have been capitalised.

9. In spite of the absence of database identifying parties as Small Scale Industrial Undertakings (SSIs), it is of the opinion of the management that there are no dues payable to SSIs. The auditors have accepted the representation of the management in this regards.

10. Under the Micro, Small and Medium Enterprises Development Act, 2006 certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company is in the process of compiling relevant information from its suppliers about their coverage under the said Act. Since the relevant information is not readily available, no disclosures have been made in the accounts. However, in the opinion of the management, the impact of interest, if any, that may be payable in accordance with the provision of this Act is not expected to be material.

11. The balances appearing under unsecured loans, sundry creditors, sundry debtors, loans and advances, and certain banks are subject to confirmation and reconciliation and consequential adjustment, if any, will be accounted for in the year of confirmation and/or reconciliation.

12. In the opinion of the Board, the Current Assets, Loans and Advances have value on realisation in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet.

13. The disputed demand in respect of Income Tax outstanding for the Assessment Year 2003-04 of Rs. 20,96,632/-, for which the Company had preferred an appeal against the department with the CIT (Appeals) has been dismissed by the CIT (Appeals) and accordingly fresh demand has been raised for Rs. 25,80,957/- The company has preferred a second appeal against the order of the CIT (Appeals) with the Income Tax Appellate Tribunal, Mumbai. The company has already paid 50% of the demand raised earlier under protest. Based on the prevalent decisions of the appellate authorities and the interpretations of the other relevant provisions, the company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision for the balance demand has been made.

14. The Company leases office under cancellable operating lease agreements that are renewable on a periodic basis at the option of both the lessor and the lessee. Rental payments under such leases are Rs. 5,15,960/- and Rs. 2,72,580/- during the year ended 31 st March, 2010 and 2009 respectively.

15. Related party disclosures as required by AS-18 are given below

(a) List of Related Parties

Key Managerial Personnel

Naresh Jain

Naresh Saboo

Relatives of Key Managerial Personnel

Santosh Saboo

Associated Concerns

Verbana Mercantile Pvt. Ltd.

Saboo Capital and Securities Pvt. Ltd.

Obident Exports Pvt. Ltd.

Diamant Infrastructure Developers Pvt Ltd

Diamant Realty Pvt Ltd

Diamant Securities Pvt Ltd

16. The management was of the opinion that there were no impairment indicators that existed as on the balance sheet date. Hence no provision for the impairment loss has been done.

17. The company has provided for deferred tax. The net deferred tax liability of Rs. 54,649/- as at the balance sheet date has been carried forward. The net deferred tax liability consists of the following components:

18. Previous years figures have been regrouped / re-classified in order to conform to current years figures.

19. Balance Sheet and General Business Profile (in terms of Part IV of Schedule VI to the Companies Act, 1956) is annexed herewith.

 
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