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Notes to Accounts of Galaxy Entertainment Corporation Ltd.

Mar 31, 2015

1. Capital and Other Commitments

a) Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for (Net of advances) Rs. Nil (Previous Year Rs. 12,213,561)

2. Contingent Liabilities not provided for:

a) In respect of guarantees given by Company's banker on behalf of the Company of Rs. 11,296,459 (Previous Year Rs. 11,298,459)

3. Winding Up Petition

A winding up petition has been fled by Manjiro Works against the company under Section 433 (e)/434 of the Companies Act, 1956 before the Hon'ble High Court of Bombay.

The company had ordered certain gaming machinery from Manjiro Works in the year 2007 but there was no Specific contract executed amongst the parties. The company made part payments against the delivery of machinery and due to delay in delivery of shipments of machineries and damage of certain parts of machineries, the balance payments were disputed and the petition is yet to be admitted.

4. Going Concern Assumption

The enterprise is normally viewed as a going concern, that is, as continuing in operation for the foreseeable future. It is assumed that the enterprise has neither the intention nor the necessity of liquidation or of curtailing materially the scale of the operations.

5. Segment Reporting

The Company has identified two reportable segments viz. Restaurants, Gaming & Others and Trading. Segments have been identified and reported taking into account nature of products and services, the differing risks and returns and the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policy of the Company with following additional policies for segment reporting.

a) Revenue and Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue and Expenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as "Unallocable".

b) Segment Assets and Segment Liabilities represent Assets and Liabilities in respective segments.

Notes:

1) Segments have been identified in line with the Accounting Standard on Segment Reporting (AS-17) taking into account the organization's structure as well as the differential risks and returns of these segments.

2) The Company has disclosed Business Segment as the primary segment and type of products and services in each segment:

3) The revenue and results figure given above are directly identifiable to respective segments and expenditure on common services incurred at the corporate level are not directly identifiable to respective segments have been shown as "Other Un-allocable Expenditure".

4) The other Information figures given above are directly identifiable to respective segments and information for corporate services for head office and investments related to acquisitions have been shown as "Others Un-allocable".

6. Deferred Tax Asset/ (Liability):

On a conservative basis, the Company has not recognized any deferred tax asset on unabsorbed business losses/unabsorbed depreciation during the current year.

7. Related Party Disclosure

In accordance with the Accounting Standard 18 on "Related Party Disclosure" notified under the Companies (Accounting Standard) Rules, 2006, as amended, the relevant information for the year ended March 31, 2015 is as under. Names of related parties and description of relationship:

8. Employee Benefits:

The Company has classified various Benefits provided to employees as under:

(i) Defined Contribution Plans: Company's contribution to the provident fund scheme is recognised during the year in which the related service is rendered with the following amounts in the financial Statement:

9. Based on the available information with the management, the Company does not owe any sum to suppliers who are registered as Micro, Small, Medium Enterprise as at March 31, 2015 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

10. In respect of amounts payable to overseas creditors for import of certain gaming machinery all liability has been provided in the respective year of imports and the management believes no further liability is to be recorded in respect of such imports.

11. Balances of Debtors and Creditors are subject to Confirmations and reconciliation.

12. In the opinion of the Board, all assets other than fixed assets and non-current investments have value on realization in the ordinary course of business at least equal to the amount at which they are stated.


Mar 31, 2014

1. Background

Galaxy Entertainment Corporation Limited (''the Company'') was incorporated on August 13, 1981. It operates leisure and entertainment centers across the country and as at the balance sheet date it has 28 centers offering a variety of facilities such as bowling, pool and video games, restaurant services, bakery, food court, etc. Further, during the year 2013-14, the company has undertaken trading activity.

2. Capital and Other Commitments

a) Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 12,213,561 (Previous Year Rs. Nil).

b) Other Commitment

The Company has entered into certain non-cancellable agreements with landlord for premises. Commitment toward the same is Rs. NIL (Previous Year Rs. 6,51,000).

3. Contingent Liabilities not provided for

a) In respect of guarantees given by Company''s banker on behalf of the Company of Rs.11,298,459 (Previous Year Rs. 11,398,459).

b) In respect of disputed tax demand not provided as following:

Particulars 2013-2014 2012-2013

Entertainment Tax Demand 20,04,648 1,603,718

Indirect Tax Demand

2003-2004 16,68,316 2,168,316

2008-2009 74,92,720 7,492,720

Income Tax

A.Y. 2009-2010 33,56,688 Nil

c) Claims on accounts of service tax on rental premises consequent to retrospective charge of service on renting activity by Finance Act 2010. Amount which is not demanded has not been provided.

d) The Company has imported Capital Goods under the Export Promotion Capital Goods Scheme of the Government of India, at concessional rates of duty, on an undertaking to fulfll export obligation by October 2015. Outstanding as at balance sheet date is Rs. 66,316,951 (Previous Year Rs. 66,316,951).

4. Going Concern Assumption

The enterprise is normally viewed as a going concern, that is, as continuing in operation for the foreseeable future. It is assumed that the enterprise has neither the intention nor the necessity of liquidation or of curtailing materially the scale of the operations.

5. Segment Reporting

Since incorporation the Company operated in a single business segment of Leisure and Entertainment services. However, during the year it has done trading activity in Fabric also. Thus, this disclosure is applicable. As per geographical segment, the Company operates in a single reportable geographical segment, i.e. within India.

Notes:

1) Segments have been identified in line with the Accounting Standard on Segment Reporting (AS-17) taking into account the organization''s structure as well as the differential risks and returns of these segments.

2) The Company has disclosed Business Segment as the primary segment and type of products and services in each segment.

3) The revenue and results figures given above are directly identifable to respective segments and expenditure on common services incurred at the corporate level are not directly identifable to respective segments have been shown as "Other Un-allocable Expenditure".

4) The Other Information figures given above are directly identifable to respective segments and information for corporate services for head office and investments related to acquisitions have been shown as "Others Un-allocable".

6. Deferred Tax Asset/(Liability)

On a conservative basis, the Company has not recognized any deferred tax asset on unabsorbed business losses/unabsorbed depreciation during the current year.

7. Related Party Disclosure

In accordance with the Accounting Standard 18 on "Related Party Disclosure" notifed under the Companies (Accounting Standard) Rules, 2006, as amended, the relevant information for the year ended March 31, 2014 is as under. Names of related parties and description of relationship:

I. Entities where control exists - Subsidiaries:

a) Rain Fruits & More Pvt. Ltd. ("RFMPL")

b) Galaxy Rain Restaurants Pvt. Ltd. ("GRRPL")

II. Entity where control exists through substantial equity interest:

a) Future Retail Limited ("FRL") (formally known as "Pantaloon Retail (I) Limited")

b) Future Value Retail Limited ("FVRL") (Merged with "Future Retail Limited")

8. Based on the available information with the management, the Company does not owe any sum to suppliers who are registered as Micro, Small, Medium Enterprise as at March 31, 2014 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

9. In respect of amounts payable to overseas creditors for import of certain gaming machinery all liability has been provided in the respective year of imports and the management believes no further liability is to be recorded in respect of such imports.

10. Balances of Debtors and Creditors are subject to confirmations and reconciliation.

11. In the opinion of the Board, all assets other than fixed assets and non-current investments have value on realization in the ordinary course of business at least equal to the amount at which they are stated.

12. The Company made investments in National Saving Certifcates (NSC) in the name of Managing Director of the company and the same has been pledged with excise authority at Mumbai (Maharashtra) on behalf of the company. The interest accrued on such investment will be accounted for on maturity.


Mar 31, 2013

1. Background

Galaxy Entertainment Corporation Limited (''the Company'') was incorporated on August 13, 1981. It operates leisure and entertainment centers across the country and as at the balance sheet date it has 17 centers offering a variety of facilities such as bowling, pool and video games, restaurant services, bakery, food court, etc.

2. Capital and Other Commitments

a) Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous Year Rs. Nil).

b) Other Commitment

The Company has entered into certain non-cancellable agreements with landlord for premises. Commitment toward the same is Rs. 651,000 (Previous Year Rs. 2,170,000).

3. Contingent Liabilities not provided for:

a) In respect of guarantees given by Company''s banker on behalf of the Company of Rs. 11,398,459 (Previous Year Rs. 11,533,959)

b) In respect of disputed tax demand not provided as following:

Particulars 2012-2013 2011-2012 Rupees Rupees

Entertainment Tax Demand 1,603,718 1,603,718

Indirect Tax Demand

2003-2004 2,168,316 2,168,316

2008-2009 7,492,720 -

c) Claims on accounts of service Tax on rental premises consequent to retrospective charge of service on renting activity by Finance Act 2010. Amount which is not demanded has not been provided.

d) The Company has imported Capital Goods under the Export Promotion Capital Goods Scheme of the Government of India, at concessional rates of duty, on an undertaking to fulfill export obligation by October 2015. Outstanding as at balance sheet date is Rs. 529, 663,942 (Previous Year Rs. 529,663,942).

4. Going Concern:

The Statutory Auditors had made an observation in their audit report for the year ending 31 March, 2012 as the going concern assumption due to complete erosion of net worth. The Company has turned around during the year and there is no negative net worth as on 31 March, 2013.

5. The Board of Directors of the Company has decided to transfer, sell and/or dispose off 5 centres of Sports Bar Undertaking operated by the Company in terms of business transfer agreement dated 28th March 2012, The approval of Shareholders of the Company under the provision of section 293(1) (a) read with section 192A is also given, As the agreement is subject to certain conditions, the disclosure required under Accounting Standard 24-"Discontinuing Operations" will be made after fulfillment of such conditions.

6. The Company operates in a single business segment of Leisure and Entertainment services. Further, the Company operates in a single reportable geographical segment, i.e. within India.

7. Deferred Tax Asset/(Liability):

On a conservative basis, the Company has not recognized any deferred tax asset on unabsorbed business losses/unabsorbed depreciation during the current year.

8. In accordance with the Accounting Standard 18 on "Related Party Disclosure" notified under the Companies (Accounting Standard) Rules, 2006, as amended, the relevant information for the year ended March 31, 2013 is as under:

Names of related parties and description of relationship:

I. Entities where control exists - Subsidiaries: Rain Fruits & More Pvt. Ltd. ("RFMPL") Galaxy Rain Restaurants Pvt. Ltd. ("GRRPL")

II. Entity where control exists through substantial equity interest: Pantaloon Retail (India) Ltd. ("PRIL")

III. Key Managerial Personnel:

M r. Rohinton Rabady (April – September)

9. Based on the available information with the management, the Company does not owe any sum to suppliers who are registered as Micro, Small, Medium Enterprise as at March 31, 2013 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

10. In respect of amounts payable to overseas creditors for import of certain gaming machinery all liability has been provided in the respective year of imports and the management believes no further liability is to be recorded in respect of such imports.

11. The agreement for certain premises occupied by the Company has expired during the year the Company is in the process of executing revised agreements.

12. During the year the Company has assigned/transferred the Brand "Sports Bar Express". The brand was self generated and hence had no cost of acquisition. The amount receivable on such assignment has been disclosed under Other Operating Income.

13. Balances of Debtors and Creditors are subject to confirmations and reconciliation.

14. In the opinion of the Board, all assets other than fixed assets and non-current investments have value on realisation in the ordinary course of business at least equal to the amount at which they are stated.


Mar 31, 2012

1. Background

Galaxy Entertainment Corporation Limited ('the Company') was incorporated on August 13,1981. It operates leisure and entertainment centres across the country and as at the balance sheet date it has 14 centres offering a variety of facilities such as bowling, pool and video games, restaurant services, etc.

2. Capital and Other Commitments

a) Capital Commitment

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous Year Rs. Nil).

b) Other Commitment

The Company has entered into certain non-cancellable agreements with landlord for premises. Commitment toward the same is Rs. 2,170,000 (Previous Year Rs. 648,252).

3. Contingent Liabilities not provided for:

a) In respect of guarantees given by banks of Rs. 11,533,959 (Previous Year Rs. 10,383,500)

b) In respect of disputed tax demand not provided as following:

Particulars 2011-2012 2010-2011 Rupees Rupees

Entertainment Tax Demand 1,603,718 -

Indirect Tax Demand 2,168,316 2,168,316

c) Claims on accounts of service Tax on rental premises consequent to retrospective charge of service on renting activity by Finance Act 2010. Amount which is not demanded has not been provided.

d) The Company has imported Capital Goods under the Export Promotion Capital Goods Scheme of the Government of India, at concessional rates of duty, on an undertaking to fulfill export obligation by October 2015. Outstanding as at balance sheet date is Rs. 529,663,942 (Previous Year Rs. 529,663,942).

4. Improvements to Leasehold Premises at Colaba are depreciated at 5%, being the written down value rate applicable to Buildings as per Schedule XIV of the Companies Act, 1956. The lease agreement in respect of the premises is for 9 years respectively. The Company has, however, decided to depreciate the asset in accordance with the rates laid down in Schedule XIV, since the Company considers this to be, effectively, a long term arrangement and expects to renew the agreement for longer periods after the expiry of the agreement. In case of other centers, company has decided to depreciate the assets over a period of 9 years which is based on primary lease term.

5. Going Concern:

The Company is incurring losses for last few years, and its accumulated losses at the last date of the financial year exceeded the net worth of the Company and its net worth has been completely eroded. The Company has restructured its business in the past years and is also considering viable expansion/restructuring plans. The company has neither the intention nor the necessity of liquidating or of curtailing materially the scale of its operations. Therefore, these accounts have been prepared on the going concern assumption.

6. The Board of Directors of the Company has decided to transfer, sell and/or dispose off 5 centres of Sports Bar Undertaking operated by the Company to a potential purchaser, together with all its assets, rights, liabilities/obligations of all nature and kind along with its employees on a going concern basis as a slump sale. The company has entered into a "Business Transfer - Payment of Advance Agreement" with the purchaser and pursuant to the said agreement has received an advance of Rs. 25,000,000. The said amount received is shown under Note No. 10-Other Current Liabilities. on Financial Statements for the Year Ended March 31, 2012

The said transaction is subject to the approval of shareholders of the company under the provisions of Section 293(l)(a) read with Section 192Aand such other applicable provisions, if any, of the Companies Act, 1956.

7. The Company operates in a single business segment of Leisure and Entertainment services. Further, the Company operates in a single reportable geographical segment.

8. Deferred Tax Asset/(Liability):

On a conservative basis, the Company has not recognized any deferred tax asset/(liability) pertaining to the currentyear.

9. In accordance with the Accounting Standard 18 on "Related Party Disclosure" notified under the Companies (Accounting Standard) Rules, 2006, as amended, the relevant information for the year ended March 31,2012 is asunder:

Names of related parties and description of relationship:

I. Entities where control exists - Subsidiaries: Rain Fruits&MorePvt. Ltd. CRFMPL") Galaxy Rain Restaurants Pvt. Ltd. ("GRRPL")

II. Entity wherecontrol existsthrough substantial equity interest: Pantaloon Retail (India) Ltd. CPRIL")

III. Key Managerial Personnel: Mr.RohintonRabady

10. Based on the available information with the management, the Company does not owe any sum to suppliers who are registered as Micro, Small, Medium Enterprise as at March 31,2012 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

11. In the opinion of the Board, all assets other than fixed assets and non-current investments have value on realisation in the ordinary course of business at least equal to the amount at which they are stated.

12. As notified by the Ministry of Corporate Affairs, Revised Schedule VI under the Companies Act, 1956, is applicable to the financial statement for the financial year commencing on or after 1st April, 2011. Accordingly, the financial statements for the year ended March 31, 2012 are prepared in accordance with the revised Schedule VI. The amounts and disclosures included in the financial statements of the previous year have been reclassified to conform to the requirements of the Revised Schedule VI.


Mar 31, 2011

1. BACKGROUND

Galaxy Entertainment Corporation Limited ('the Company') was incorporated on August 13, 1981. It operates leisure and entertainment centres across the country and as at the balance sheet date it has 20 centers offering a variety of facilities such as bowling, pool and video games, restaurant services, etc.

2. Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous year Rs.Nil).

3. a) Contingent liabilities not provided for in respect of guarantees given by banks of Rs. 10,383,500 (Previous Year Rs. 10,937,600)

b) The Company has imported Capital Goods under the Export Promotion Capital Goods Scheme, of the Government of India, at concessional rates of duty on an undertaking to fulfill export obligation by October 2015. Outstanding as at balance sheet date is Rs.529,663,942 (Previous Year Rs. 529,663,942).

c) Claims on accounts of service Tax on rental premises consequent to retrospective charge of service on renting activity by Finance Act 2010. Amount not ascertained.

4. Improvements to Leasehold Premises at Colaba is depreciated at 5%, being the written down value rate applicable to Buildings as per Schedule XIV of the Companies Act, 1956. The lease agreement in respect of the premises is for 9 years respectively. The Company has, however, decided to depreciate the asset in accordance with the rates laid down in Schedule XIV, since the Company considers this to be, effectively, a long term arrangement and expects to renew the agreement for longer periods after the expiry of the agreement. In case of other centers, company has decided to depreciate the assets over a period of 9 years which is based on primary lease term.

5. Vide Notification no: SO 301(E) dated 08/02/2011 issued by MCA.The Company has availed exemption from the disclosure requirements under para 3(i) (a) & 3(ii)(d) of Part III of Schedule VI with respect to figures of sales and purchases. The Board of Directors has given consent with regard to non-disclosure of information.

6. The Company operates in a single business segment of Leisure and Entertainment services. Further, the Company operates in a single reportable geographical segment.

7. Deferred Tax Asset/(Liability): - On a conservative basis, the Company has not recognized any deferred tax asset /(liability) pertaining to the current year.

8. Related party disclosures

In accordance with the Accounting Standard 18 on "Related Party Disclosure" issued by the ICAI, the relevant information for the year ended March 31,2011 is asunder:

Names of related parties and description of relationship:

I. Entities where control exists - Subsidiaries:

Rain Fruits & More Pvt. Ltd. ("RFMPL") Galaxy Rain Restaurants Pvt. Ltd. CGRRPL")

II. Entity where control exists through substantial equity interest:

Pantaloon Retail (India) Ltd. ("PRIL")

III. Key Managerial Personnel

Mr.Rohinton Rabady

9. The Company has classified various benefits provided to employees as under:

II. Defined Benefit Plans

a. Contribution to Gratuity Fund (Non-Funded Scheme)

b. Leave Encashment (Non - Funded Scheme)

10. Based on the available information with the management, the Company does not owe any sum to a small scale industrial undertaking as defined in clause (j) to section 3 of the Industries (Development and Regulation) Act, 1951 and there are no suppliers who are registered as Micro, Small, Medium Enterprise as at March 31,2011 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

11. In the opinion of the management, the current assets, loans and advances and current liabilities are of the value stated, if realized/paid in the ordinary course of business. The provision for depreciation on fixed assets and provision for all known liabilities is adequate and is not in excess of amounts considered reasonably necessary.

12. Previous year's figures have been regrouped where necessary to conform to current year's classification.


Mar 31, 2010

1. Background

Galaxy Entertainment Corporation Limited (the Company) was incorporated on August 13, 1981. It operates leisure and entertainment centers across the country and as at the balance sheet date it has 23 centers offering a variety of facilities such as bowling, pool and video games, restaurant services, etc.

2. Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs Nil (Previous year Rs.20,097,830).

3. a) Contingent liabilities not provided for in respect of guarantees given by banks of Rs. 10,937,600 (Previous Year Rs. 11,902,559).

b) The Company has imported Capital Goods under the Export Promotion Capital Goods Scheme, of the Government of India, at concessional rates of duty on an undertaking to fulfill export obligation of Rs.529,663,942 outstanding as at balance sheet date (Previous Year Rs. 529,663,942).

c) Claims on accounts of Service Tax on rental premises consequent to retrospective charge of service on renting activity by Finance Act 2010. Amount not ascertained.

4. Improvements to Leasehold Premises at Lower Parel and Colaba are depreciated at 5%, being the written down value rate applicable to Buildings as per Schedule XIV of the Companies Act, 1956. The lease agreement in respect of these premises is for 12 and 9 years respectively. The Company has, however, decided to depreciate the asset in accordance with the rates laid down in Schedule XIV, since the Company considers this to be, effectively, a long term arrangement, and expects to renew the agreement for longer periods after the expiry of the agreement. In case of other centers, company has decided to depreciate the assets over a period of 9 years which is based on primary lease term.

5. The Department of Company Affairs has vide its order no. 46/80/2010-CL/HI dated April 30, 2010 granted exemption for the financial year ending on March 31, 2010 from disclosing the quantitative details required by paragraph 3(i)(a) [in respect of turnover] subject to income from wine and liquor to be shown under separate sub-head under the head income and 3(ii)(d) [in respect of opening and closing stock, purchases, sales and consumption of raw material] subject to consumption of provisions, wine and smokes to be shown under the following two sub-heads respectively of Part II of Schedule VI to the Companies Act, 1956 in respect of the Company:

6. The Company operates in a single business segment of Leisure and Entertainment services. Further, the Company operates in a single reportable geographical segment.

7. Contingent Liabilities

Particulars 2009-2010 2008-2009 Rupees Rupees

Income Tax Demand 4,042,964 4,042,964

Indirect Tax Demand 2,168,316 2,168,316

8. Related Party Disclosures

In accordance with the Accounting Standard 18 on "Related Party Disclosure" issued by the ICAI, the relevant information for the year ended March 31,2010 is as under:

Names of related parties and description of relationship:

I. Entities where control exists - Subsidiaries: Rain Fruits & More Pvt. Ltd. ("RFMPL") Galaxy Rain Restaurants Pvt. Ltd. ("GRRPL")

II. Entity where control exists through substantial equity interest: Pantaloon Retail (India) Ltd. ("PRIL")

III. Key Managerial Personnel

Mr. Sanjay Seksaria (Whole Time Director)

The following are the volume of transactions with related parties during the year and outstanding balances as at the year end disclosed in aggregate by type of related party:

9. The Company has classified various benefits provided to employees as under: I. Defined Contribution Plans

Provident Fund

The Company has recognized the following amounts in Profit and Loss Account:

II. Defined Benefit Plans

a. Contribution to Gratuity Fund (Non-Funded Scheme)

b. Leave Encashment (Non-Funded Scheme)

In accordance with the Accounting Standard (AS 15) (Revised 2005), actuarial valuation was performed in respect of the aforesaid defined benefit plans based on the following assumptions:

Discount Rate (per annum) 8%

Rate of increase in compensation levels (per annum) 10%

The actuarial valuations have been done without giving effect to the enhanced limit of Gratuity payable from Rs. 350,000 to Rs. 1,000,000, the resulting effect of which is not quantifiable.

10. Based on the available information with the management, the Company does not owe any sum to a small scale industrial undertaking as defined in clause (j) to section 3 of the Industries (Development and Regulation) Act, 1951 and there are no suppliers who are registered as Micro, Small, Medium Enterprise as at March 31, 2010 in terms of the provisions of "The Micro, Small, Medium Enterprise Development Act, 2006".

11. In the opinion of the management, the current assets, loans and advances and current liabilities are of the value stated, if realized/paid in the ordinary course of business. The provision for depreciation on fixed assets and provision for all known liabilities is adequate and is not in excess of amounts considered reasonably necessary.

12. Previous years figures have been regrouped where necessary, to conform to current years classification.

 
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