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Notes to Accounts of Eco Recycling Ltd.

Mar 31, 2015

1. Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.10/- each. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees.

2.In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of prefential amounts. The distribution will be in proportion to the numbers of equity shares held by the shareholders.

3. Indian Rupee term loan from bank is repayable in equated periodic installments upto a 5 year period each along with interest. Further, the loan has been guaranteed by personal guarantee of the chairman and managing director of the company, Ecoreco Ventures Private Limited, the holding company and by collateral security of the registered office in the name of B.K.Soni (HUF) and Pledge of 3.40 lakhs equity shares of the company by the chairman and managing director of the company Mr. B.K. Soni.

4. Unsecured Long-Term Borrowings:

b) Repayment to start after 1 year from the date of completion of the project in 5 annual instalments.

5. Contingent Liabilities

Guarantee given by Bank on behalf of the Company Secured against equal fixed deposits

Standing Bank Guarantee in favour 1,810,000 1,810,000 of The Customs, JNPT

Custom Duty on Imported Machineries 12,400,000 12,400,000 cannot be sold or transferred to any person or other organisation for a period of 5 years from the date of its import

6. The Company has been dealing with Keynote Capital Markets Limited (Keynote) for its Share transactions. A substantial portion i.e 20,56,234 Nos. of shares amounting to Rs.4,48,55,092/- out of the investment portfolio maintained by the company in demat form with Keynote has been appropriated by the Keynote against the loss booked by Keynote on account of transactions in the F&O Segment carried out by Keynote on its own without any authorisation of the company. The company has taken appropriate actions against Keynote with SEBI, NSE & Economic Offence Wing (EOW) of the Mumbai Police for the recovery of the misappropriation of the investment of the company. In this matter Company has won both the appeals of Arbitration Committee of The National Stock Exchange. In the month of August, 2014 Keynote has filed an appeal u/s 34 in the High Court, which is still pending. The Company is confident that it will be able to recover its amount and therefore no accounting impact has been given to such misappropriated investments till the matter is sub-judice.

7. The Company has not provided provision for gratuity on employees on accrual basis, which is not in conformity with AS-15 - Employee Benefits as required under The Gratuity Act, 1972. However in the opinion of the management the amount involved is negligible and has no impact on Statement of profit and loss account.

8. The Company has not written off the "Miscellaneous Expenditure" amounting to Rs.39,19,517/- fully in Statement of profit and loss account, which is not in confirmity with AS - 26 - Intangible Assets which had arise at the time of amalgamation. However in the opinion of the management it will not create any discrepancy as the treatment taken is as per the provisions of The Income Tax Act, 1961.

9. The office of the Whole Time Company Secretary has been vacant and the Company is in process of appointing a full time company secretary as per Companies Act 2013.

10. The Company is engaging in research & development activity on Electronic Waste. The expenses incurred during the year other than capital expenditure is charged off in the Statement of profit and loss. The expenses included legal & professional fees, employee benefits expenses & other expenses incurred during the year.

11. The company is in the business of E-waste and Asset Management.

12. Balances of some of the trade receivable, trade payable and creditor of expenses, loans and advances are subject to confirmation from the respective parties and consequential adjustments arising from reconciliation, if any. The management, however is of the view that there will be no material adjustments in this regards.

13. Related Party Transactions

Related party disclosures as required by AS - 18, "Related Party Disclosures", are given below " i) Relationships :

(a) Holding Company :-

Ecoreco Ventures Private Limited

(b) Associates :-

Reverse Logistics & Warehousing Private Limited

Ecoreco Park Private Limited

WEEE India Private Limited

Data De-End Private Limited

(c) Key Management Personnel :-

Mr. B. K. Soni - C.M.D.

Mrs. Aruna Soni - Director

Mr. Srikrishna B. - Director

Mr. T R Rao - Director

Mr.Shashank Soni - Director

Mr. Vijay Acharya - Director

Ms. Anita Choudhari - CFO

14. Previous year's figures have been regrouped/reclassified wherever necessary to correspond with the current year's classification/ disclosure.


Mar 31, 2014

1. a) 11,342,500 (P.Y.11,342,500) Equity Shares out of the issued, subscribed and paid up share capital were alloted in the last five years pursuant to the schemes of amalgamation of Eco Recycling Limited and Infotrek Syscom Limited without payments being received in cash.

b) Terms / rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10/- each. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of prefential amounts. The distribution will be in proportion to the numbers of equity shares held by the shareholders.

c) Details of Shareholders holding more than 5 % shares in the Company

Secured Long-Term Borrowings:

d) Indian Rupee term loan from bank is repayable in equated periodic installments upto a 5 year period each along with interest, after the repayment holiday of 1 year viz., June, 2013. The loan is secured by hypothecation of inventory and trade receivables of the company. Further, the loan has been guaranteed by personal guarantee of the chairman and managing director of the company, Ecoreco Ventures Private Limited, the holding company and by collateral security of the registered office in the name of B.K.Soni (HUF) and Pledge of 3.40 lakhs equity shares of the company by the chairman and managing director of the company Mr. B. K. Soni.

Unsecured Long-Term Borrowings:

e) Repayment to start after 1 year from the date of completion of the project in 5 annual instalments.

*Working Capital Loans from banks are secured by way of hypothecation of Stock, Book-Debts and Personal Gurantee of the Chairman and Managing Director of the company Mr. B.K. Soni.

*The Company has not received any intimation 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 paid/payable as required under the said Act have not been made.

*Includes Tax deducted at source, Provident Fund and Profession Tax.

Note : * It represents an expenditure for development of the project ''E-Waste recycling and Precious metal recovery'' under TDDP of TDPU and DSIR.

2 Disclosure in Respect of Leases:

I Operating Lease: Company as Lessee

The Company''s leasing arrangements are in respect of operating leases for factory, office premises and guest house occupied by the Company. These leasing arrangements are cancellable except during the lock in period, and are renewable on a periodic basis by mutual consent on mutually acceptable terms.

3 Contingent Liabilities

Guarantee given by Bank on behalf of the Company Secured against equal fixed deposits

Standing Bank Guarantee in JNPT 1,810,000 1,810,000 favour of The Customs,

Standing Bank Guarantee for Tender in - - favour of The MMRDA

Custom Duty on Imported Machineries cannot be sold or transferred to any person or other 12,400,000 12,400,000 organisation for a period of 5 years from the date of its import

4 The Company was availing of broking services of M/s. Keynote Capitals Limited (Keynote), a BSE & NSE Broker. In the month of March, 2013 Keynote misappropriated the entire portfolio of the company lying in the demat account and transferred in its favor. The company immediately filed a complaint with the SEBI. SEBI then forwarded our complaint to the Arbitration Committee of NSE which decided the matter in favor of the company, against which Keynote went into an appeal but here too the Appellate Tribunal of NSE upheld the award passed by the Arbitration Committee. Keynote has now filed an application with Mumbai High Court for setting aside the award passed by the Appellate Tribunal of NSE. Since the matter is sub-judies and therefore no accounting treatment has been given to such misappropriated investments.

5 The Company has not provided provision for gratuity on employees on accrual basis, which is not in conformity with AS-15 - Employee Benefits as required under The Gratuity Act, 1972. However in the opinion of the management the amount involved is negligible and has no impact on Statement of profit and loss account.

6 The Company has not written off the "Miscellaneous Expenditure" amounting to Rs. 64,98,617/- fully in Statement of profit and loss account, which is not in confirmity with AS - 26 - Intangible Assets which had arise at the time of amalgamation. However in the opinion of the management it will not create any discrepancy as the treatment taken is as per the provisions of The Income Tax Act, 1961.

7 The office of the Whole Time Company Secretary has been vacant and the Company is in process of appointing a full time company secretary as amended by The Companies Act, 1956.

8 The Company is engaging in research & development activity on Electronic Waste. The expenses incurred during the year other than capital expenditure is charged off in the Statement of profit and loss. The expenses included legal & professional fees, employee benefits expenses & other expenses incurred during the year.

9 The company is in the business of E-waste Management and Recycling.

10 The Company in 2012-13 has entered into agency arrangements with "Nippon Magnetic Dressing Co. Ltd.(NMD)" - Japan for technology agreements. Under this arrangements the company has issued equity shares on preferential basis to NMD and is setting up a facility for research and development in E-waste Management and recycling and increasing awareness in the society.

The NMD has reimbursed full Construction and modification cost of facility of which the Company has retained all risk and reward of ownership of assets. The reimbursement cost is in Japanese YEN; the difference arising on exchange amount is dealt to statement of profit and loss account as per AS - 11.

Under the arrangements NMD has exported to India two Machineries amounting to Rs. 112,944,791/- under technological arrangements with the company. These machines have been provided free of cost to be installed in facility where the company has paid only custom duty on the same amounting to Rs. 60,48,202/- in which the company has retained all risks and rewards of ownership of assets.

11 Balances of some of the trade receivable, trade payable and creditor of expenses, loans and advances are subject to confirmation from the respective parties and consequential adjustments arising from reconciliation, if any. The management, however is of the view that there will be no material adjustments in this regards.

12 Related Party Transactions

Related party disclosures as required by AS - 18, "Related Party Disclosures", are given below "

i) Relationships:

(a) Holding Company:-

Ecoreco Ventures Private Limited

(b) Associates:-

Reverse Logistics & Warehousing Private Limited Bennett Coleman & Company Limited (BCCL).

Nippon Magnetic Dressing Co., Ltd (NMD) - Japan Ecoreco Park Private Limited

(c) Key Management Personnel:-

Mr. Brijkishor Soni - C.M.D.

Mrs. Aruna Soni - Director Mr. Srikrishna B. - Director Mr. T R Rao - Director Mr. Shashank Soni - Director Mr. Mahendra Thanai - CEO

13 Previous year''s figures have been regrouped/reclassified wherever necessary to correspond with the current year''s classification/ disclosure.


Mar 31, 2013

1 The Company has been dealing with Keynote Capital Markets Limited (Keynote) for its Share transactions. A substantial portion i.e 20,56,234 Nos. of shares amounting to Rs. 4,48,55,092/- out of the investment portfolio maintained by the company in demat form with Keynote has been appropriated by the Keynote against the loss booked by Keynote on account of transactions in the F&O Segment carried out by Keynote on its own without any authorisation of the company. The company has taken appropriate actions against Keynote with SEBI, NSE & Economic Offence Wing (EOW) of the Mumbai Police for the recovery of the misappropriation of the investment of the company. Investigation / hearing in the matter is at an advanced stage at all the authorities. The company is confident that it will be able to recover its amount and therefore no accounting impact has been given to such misappropriated investments till the matter is sub-judice.

2 The Company has not provided provision for gratuity on employees on accrual basis, which is not in conformity with AS-15 - Employee Benefits as required under The Gratuity Act, 1972. However in the opinion of the management the amount involved is negligible and has no impact on Statement of profit and loss account.

3 The Company has not written off the "Miscellaneous Expenditure" amounting to Rs. 62,69,089/- fully in Statement of profit and loss account, which is not in confirmity with AS - 26 - Intangible Assets which had arise at the time of amalgamation. However in the opinion of the management it will not create any discrepancy has the treatment taken is as per the provisions of The Income Tax Act, 1961.

4 The office of the Whole Time Company Secretary has been vacant and the Company is in process of appointing a full time company secretary as amended by The Companies Act, 1956.

5 The Company is engaging in research & development activity on Electronic Waste. The expenses incurred during the year other than capital expenditure is charged off in the Statement of profit and loss. The expenses included legal & professional fees, employee benefits expenses & other expenses incurred during the year.

6 The company is in the business of E-waste Management and Recycling, Trading in stock of shares, Derivative, Future and options & Speculation business.

7 i) The Company in current year has entered into agency arrangements with "Nippon Magnetic Dressing Co. Ltd.(NMD)" - Japan for technology agreements. Under this arrangements the company has issued equity shares on preferential basis to NMD and is setting up a facility for research and development in E-waste Management and recycling and increasing awareness in the society.

ii) The NMD has reimbursed full Construction and modification cost of facility of which the Company has retained all risk and reward of ownership of assets. The reimbursement cost is in Japanese YEN; the difference arising on exchange amount is dealt to statement of profit and loss account as per AS - 11.

iii) Under the arrangements NMD has exported to India two Machineries amounting to Rs. 4,58,53,055/- under technological arrangements with the company. These machines have been provided free of cost to be installed in facility where the company has paid only custom duty on the same amounting to Rs. 27,91,011/- in which the company has retained all risks and rewards of ownership of assets. After the completion of construction & installation of facility and machines, the company will capitalized these assets in the books of accounts by revaluing the assets under AS – 10. Till then, the company will classify the mentioned amounts as Capital Advances under "Long-Term Loans and Advances" and receipts under "Other Long-Term Liabilities".

8 Balances of some of the trade receivable, trade payable and creditor of expenses, loans and advances are subject to confirmation from the respective parties and consequential adjustments arising from reconciliation, if any. The management, however is of the view that there will be no material adjustments in this regards.

9 Disclosure of Closing stock under Section 372(10) of the Companies Act 1956

The company holding listed equity shares as stock-in-trade, the market value of which as at year end Rs. 27,24,382/- (P.Y. Rs. 29,54,081/-). The company policy is to value the equity shares held as a stock-in-trade at cost.

10 Related Party Transactions

Related party disclosures as required by AS - 18, "Related Party Disclosures", are given below "

(i) Relationships :

(a) Holding Company :- First Online Comtrades Private Limited

(b) Associates :- Kriscon Services Private Limited

Reverse Logistics & Warehousing Private Limited Bennett Coleman & Company Limited (BCCL). Nippon Magnetic Dressing Co., Ltd (NMD) - Japan

(c) Key Management Personnel :- Mr. Brijkishor Soni - C.M.D. Mrs. Aruna Soni - Director

Mr. Srikrishna B. - Director Mr. T R Rao - Director Mr. Deepak Nanda - Director Mr.Shashank Soni - Relative

11 Previous year''s figures have been regrouped/reclassified wherever necessary to correspond with the current year''s classification/ disclosure.


Mar 31, 2012

A) Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs 10/- each. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees.

In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of prefential amounts. The distribution will be in proportion to the numbers of equity shares held by the shareholders.

1 Disclosure in Respect of Leases:

The Company's leasing arrangements are in respect of operating leases for factory, office premises and guest house occupied by the Company. These leasing arrangements are cancellable except during the lock in period, and are renewable on a periodic basis by mutual consent on mutually acceptable terms.

a) The total of future minimum lease payments during lock in period of operating leases for each of the following periods.

Particulars

i) Not later than one year

ii) Later than one year and not later than five years

iii) Later than five years

31.03.2012 31.03.2011 (Rupees) (Rupees)

2 Contingent Liabilities

Guarantee given by Bank on behalf of the Company Secured against equal fixed deposits Standing Bank Guarantee in favour of The Customs, JNPT 1,810,000 1,810,000

Standing Bank Guarantee for Tender in favour of The MMRDA 20,000,000 -

3 The office of the Company Secretary has been vacant and the Company is in process of appointing a full time company secretary.

4 The Company has not provided for gratuity, leave encashment and leave travel allowances to employees on accrual basis, which is not in conformity with AS-15 issued by ICAI. However in the opinion of the management the amount involved is negligible and has no impact on profit and loss account.

5 The company is into single segment of E-waste Management and Recycling. Hence segment wise reporting is not applicable.


Mar 31, 2010

1. In the opinion of the Board, the Current Assets, Loans and Advances have a value on realization in the ordinary course of business at least equal to the amount at which they are stated in the financial statements.

2. No revaluation of fixed assets has been made since the date of incorporation of the Company.

3. In the opinion of the Management, the Provident Fund and ESI Acts are not applicable to the Company.

4. The Company has not provided for gratuity and leaves encashment and leave travel allowances to employees on accrual basis, which is not in conformity with AS-15 issued by ICAI. However in the opinion of management the amount involved is negligible and has no impact on profit and loss account.

5. Standing Bank guarantee of Rs. 1810000/= In favor of The Customs, JNPT is fully secured against equal fixed deposit with the bank.

6. As per the accounting standard 18 on "Related Party Disclosures" issued by the ICAI the related Parties of the company and nature of relationship are as follows:

RELATED PARTY NATURE OF RELATIONSHIP

Brij Kishor Soni Key Management Personnel

Aruna Soni Director

N.R.Colors ltd One Common Director

First Online Comtrades Pvt. Ltd. Two Common Directors

B. K. Soni HUF CMD Is Karta Of HUF

7. Deferred Income Tax:

Deferred tax has been provided in accordance with the Accounting Standard 22- Accounting for Taxes on Income issued by the Institute of Chartered Accountants of India. The deferred tax liabilities as on 31st March, 2010 amounting to Rs. 1,72,799/- is the difference between the book depreciation and tax depreciation.

8. Previous year figures have been regrouped and rearranged wherever necessary to confirm to this years classification. The accounts includes Eco-Recycling Ltd figures of three months from 01-01-10 till 31-03-10 on account of the merger. Hence figures are not comparable with last year.

9. Contingent liability - Disputed Income Tax demand Rs. 1,281,837 for the A.Y. 1998-99.

10. There are no parties, which can be classified as small-scale undertakings to whom the company owes a sum exceeding Rs. 1 Lac, which is outstanding for more than 30 days.

 
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