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Notes to Accounts of Globus Spirits Ltd.

Mar 31, 2018

Note 1 - General information and Significant Accounting Policies

Note 1.1 - General information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act. The registered office of the Company is located at F-0, Ground Floor, The Mira Corporate Suites, Plot No. 1 & 2, Ishwar Nagar, Mathura Road, New Delhi - 110065. The Company is primarily engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Bulk Alcohol and Franchise Bottling.

Note 1.2 - Statement of compliance

These standalone Ind AS financial statements of the Company have been prepared in accordance with the Indian Accounting Standards (Ind AS) as prescribed under the Companies (Indian Accounting Standards) Rules, 2015. The financial statements up to the year ended March 31, 2017 were prepared in accordance with Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 and other relevant provisions of the Act (‘Previous GAAP’). These are Company’s first Ind AS financial statements. The date of transition to Ind AS is April 1, 2016. Refer note 46 for an explanation of the transition from previous GAAP to Ind AS and the effect on the Company’s financial position, financial performance and cash flows.

(c) Market risk

“Market risk is the risk that the fair value of future cash flows of a financial instrument that will fluctuate because of changes in market prices. Market risk com prise of three types of risk i.e interest rate risk, foreign currency risk and other price risk.Financial instruments affected by market risk include trade receivables and advances.The Company enters into derivative contracts to manage its exposure to foreign currency risk.”

Foreign Currency risk management

Foreign currency risk also known as Exchange Currency Risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. Foreign currency risk in the Company is attributable to Company’s operating activities.

The carrying amounts of the Company’s foreign currency denominated monetary assets and monetary liabilities at the end of the reporting period demoninated in Rupees are as follows:

Forward foreign exchange contracts

The Company uses derivative financial instruments exclusively for hedging financial risks that arise from its commercial business. The Company manages its foreign currency risk by hedging transactions that are expected to occur within of 2 to 3 months for hedges of forecasted sales. When a derivative is entered into for the purpose of being a hedge, the Company negotiates the terms of those derivatives to match the terms of the hedged exposure. For hedges of forecast transactions, the derivatives cover the period of exposure from the point the cash flows of the transactions are forecasted up to the point of settlement of the resulting receivable that is denominated in the foreign currency. All identiled exposures are managed as per the policy duly approved by the Board of Directors.

Note 2 - Employee benefits plans

Sensitivity analysis of the defined benefit obligation

The significant actuarial assumption for the determination of defined benefit obligations are discount rate and expected salary increase.

(b) Defined contribution Plans

“The Company makes contribution towards employees’ provident fund for qualifying employees. Under the schemes, the Company is required to contribute a specified percentage of payroll cost, as specified in the rules of the schemes, to these defined contribution schemes.

Note 3 - Segment reporting

The Company is engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Bulk Alcohol and Franchise Bottling. This is the only activity performed and is thus also the main source of risks and returns. The Company’s segments as reviewed by the Chief Operating Decision Maker (CODM) does not result in to identification of different ways/ sources into which they seethe performance of the Company. Accordingly, the Company has a single reportable segment.

Note 4 - Information about majorcustomer

Included in revenue are revenues of approximately Rs. 37,651.63 lacs (2016-17 K 27,811.54 lacs) which arose from sales to the company’s largest customer (refer note 12). No other single customer contributed 10% or more to the company’s revenue for both 2017-18 and 2016-17.

Note 5 - Related party disclosures under Ind-AS-24 “Related Party Disclosures”

a) Subsidiaries:

Unibev Limited (Formerly known as Uber Blenders & Distillers Limited)

b) Key managerial personnel and their relatives:

Key management personnel

Mr. Ajay Kumar Swarup Mr. Shekhar Swarup Dr. Bhaskar Roy Mr. Manik Lai Dutta Mr. AjayGoyal

c) Enterprises over which key managerial personnel and / or their relatives exercise significant influence: Biotech India Limited Chandbagh Investments Limited GRAS education and training Services Private Limited Himalayan Spirits Limited Globus Spirits (Jharkhand) Limited Globus Trois Freres India Limited Globus Feeds Private Limited VC technologies Private Limited Northern India Alcohol Sales Private Limited Rajasthan Distilleries Private Limited ADL Agrotech Limited (Formerly known as Assocaited Distilleries Limited)

Note 6- Fair value hierarchy

Some of the company’s financial assets are measured at fair value at the end of each reporting period.

The following table presents fair vale hierachy of financial assets measured at fair value on a recurring basis:

During the year ended March 31, 2018, there were no transfers between Level 1 and Level 2 fair value measurements, and no transfes in to and out of Level 3 fair value measurements.

Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2 inputs other than quoted prices included within level 1 that are observable for the assets or liability, either directly or indirectly.

Level 3 inputs are unobservable in puts for the assets or liability.

Note 7 (a) - Transition to Ind AS - principle and reconciliations

Overall principleThese are the Company’s first financial statement prepared in accordance with Ind AS, accordingly the Company has prepared the opening balance sheet as per Ind AS at of April 1, 2016 (the transition date) by recognising all assets and liabilities whose recognition is required by Ind AS, not recognising items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognised assets and liabilities. However, this principle is subject to the exception and certain optional exemptions availed by the Company as detailed below:

A. Mandatory exceptions Estimates

The estimates as at April 1,2016 and as at March 31, 2017 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

(i) Fair value through profit or loss (FVTPL) - unquoted equity shares

(ii) Impairment of financial assets based on expected credit loss modelThe estimates used by the Company to present these amounts are in accordance with the Ind AS which reflects conditions as at April 1,2016, the date of transition to Ind AS and as at March 31,2017.

Derecognition of financial assets and financial liabilities

The Company has applied the derecognition requirements of financial assets and financial liabilities prospectively for transactions occurring on or after transition date.

Classification and measurement of financial instruments (I) Financial Instruments: (Security deposits)

Financial assets / liabilities like security deposits has been classified and measured at amortised cost on the basis of the facts and circumstances that exist at the date of transition to Ind AS.

{II) Impairment of financial assets

The Company has applied the impairment requirements of Ind AS 109 retrospectively; however, as permitted by Ind AS 101, it has used reasonable and supportable information that is available without undue cost or effort to determine the credit risk at the date that financial instruments were initially recognised in order to compare it with the credit risk at the transition date. Further, the Company has not undertaken an exhaustive search for information when determining, at the date of transition to Ind AS, whether there have been significant increases in credit risk since initial recognition, as permitted by Ind AS 101.

B. Optional exemptions

Deemed cost for property, plant and equipment and intangible assets

The Company has opted to measure all of its property, plant and equipment and intangible assets at the fair value and use that fair value as its deemed cost.

I nvestment i n eq u ity shares of su bsidiaries at deemed cost

The Company has opted to measure its investment in subsidiary at their previous GAAP carrying value in separate financial statement and use that carrying value as deemed cost.

Determining whether an arrangement contains a lease

Append ixC to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. However, the Company has used Ind AS 101 exemption and assessed all arrangements based on conditions in place as at the date of transition.

Designate of previously recognised financial instrument

The Company has elected this exemption and opted to designate financial asset at FVTPL as per Ind AS 109 based on facts and circumstances that exist as on transition date.

Note: -

(a) Leasehold land

Under previous GAAP, the leasehold land was considered as part of property, plant and equipment as being long lease, accordingly in the financial year 2016-17 no amortisation was charged. As per Ind AS-17 leasehold land of Rs.1,056.48 lacs has now been classified as operating lease and the premium paid on leasehold land is amortized over the period of the lease which amounts to Rs.10.72 lacs in financial year 2016-17. The proportionate unamortized amount of Rs. 17.83 lacs upto the date of transition is adjusted against retained earnings in the opening balance sheet.

(b) Property, plant and equipment

The Company has elected to recognise its Property, plant and equipment (PPE) at fair value as on April 1, 2016 and use that as its deemed cost as of transition date. As on the transition date such fair value adjustment resulted in net increase of PPE by Rs. 40.65 lacs with corresponding increase in retained earnings. Depreciation amounting toRs. 400.66 lacs in financial year 2016-17 has been adjusted in the statement of prof it and loss. The fair value adjustment resulted in increase of freehold land by Rs.1,543.63 lacs and decrease of other PPE By Rs.1,502.98 lacs which resulted in deferred tax income of Rs. 160.55 lacs.

(c) Intangible Assets

Under previous GAAP, knowhow and new brand development was being amortised. Under the Ind AS 38, such intangible assets fair valued as at the transition date and accordingly, the intangible assets have been written down to Rs. Nil. Consequently, Rs.1 ,443.30 lacs has been charged off from Retained earnings as on the transition date and Rs. 721.64 has been adjustment has been passed for reversal of amortisation booked under Indian GAAP for the year ended March 31,2017.

(d) Investments

Under the previous GAAP, long term investments were measured at cost less diminuition which is other than temporary. Under Ind AS 40, these financial assets have been classified as FVTPL. On the transition date these financial assets have been measured at their fair value which is greater than the cost as per previous GAAP, resulting in increase in carrying amount byRs. 2.69 lacs as at transition date with resulting gain adjusted in retained earnings.

(e) Capital subsidy

Under the previous GAAP, Capital subsidy was treated as part of retained earnings treating the same in the nature of Pro motor contribution, now under Ind AS 20 the same has been deferred as subsidy received and to be amortised over the period of related property, plant and equipment. The resulting amount for the period ended March 31,2017 amounting to Rs. 181.84 lacs is treated as deferred liability

(f) Borrowings

Under previous GAAP, transaction costs incurred in connection with long term borrowings were charged off in the year of borrowing. Ind AS 109 requires transaction costs incurred towards origination of borrowings to be deducted from the carrying amount of borrowings on initial recognition. These costs are recognised in the statement of profit and loss over the tenure of the borrowings as part of interest expense using effective interest rate method. The resulting net impact of Rs. 11.76 lacs is charged in the statement of profit and loss for the year ended March 31,2017.

(g) Security deposits

Under the previous GAAP, interest free security deposits given were recorded at their transaction value. Under Ind AS, all financial assets are required to be recognised at fair value. Difference between the fair value and transaction value of the security deposits has been recognised as prepaid expenses and is amortised over the period of security deposit on straight line basis. Notional interest income on such deposits is recognised over the security period using effective interest method. The resulting net impact of Rs. 4.33 lacs is charged in the statement of profit and loss for the year ended March 31,2017.

(h) Actuarial gains/losses on defined benefit obligation

Under previous GAAP in respect of defined benefit plan, actuarial gains and losses were recognised in the statement of profit or loss. Under Ind AS, the actuarial gains and losses forming part of re-measurement of the net defined benefit liability / asset is recognised in other comprehensive income. The tax effect of the same has also been recognised in other comprehensive income under Ind AS instead of the statement of profit and loss. There is no impact on the total equity

(i) Excise duty

Under previous GAAP, revenue from sale of goods was presented net of excise duty under revenue from operations. Whereas, under Ind AS, revenue from sale of goods includes excise duty. The corresponding excise duty expense of Rs.33,396.24 lacs is presented separately on the face of the statement of profit and loss. The change does not affect total equity as on April 1,2016 and March 31,2017 and the profit for the year ended March 31,2017.

(j) Other comprehensive income

Under previous GAAP, there was no concept of other comprehensive income. Under Ind AS, specified items of income, expense, gains, or losses are required to be presented in other comprehensive income.

(k) Deferred tax assets / liabilities

Indian GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS 12 requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base. The application of Ind AS 12 approach has resulted in recognition of deferred tax on the various transitional adjustments lead to temporary differences. According to the accounting policies, the company has accounted for such differences. Deferred tax adjustments are recognised in correlation to the underlying transaction either in retained earnings ora separate component of equity. Such adjustments amounting to Rs. 270.33 lacs as at March 31,2017 andRs. 652.24 lacs as at April 01,2016.

(I) Rebate and discount

Under previous GAAP, rebate and discount was shown under other expenses. However, under Ind AS, sale of goods is presented net of discount of Rs. 1,487.91 lacs. Thus sale of goods under Ind AS has decreased for the year ended March 31,2017 with a corresponding decrease in other expenses. The change does not affect total equity as on April 1,2016 and March 31,2017 and profit for the year ended March 31,2017.

(m) Recognition of Mark to Market (MTM) gain/loss of foreign forward exchange contracts through profit or loss. (As at April 01, 2016 : Rs. 5.25 lacs andRs. 5.65 lacs for the year ended March 31,2017)

(n) The transition from Indian GAAPtolnd-AS had no significant impact on cash flows generated by the Company

Note 8 - Approval of financial statements

The financial statements were approved for issue by the Board of Directors on May 21,2018.


Mar 31, 2016

(ii) Terms/ rights attached to equity shares

The Company has only one class of equity shares entitled to one vote per share.

(iii) Conversion of cumulative compulsorily convertible preference shares (CCCPS) into equity shares 5,038,168, 4.75% CCCPS of Rs. 140 each allotted to Templeton Strategic Emerging Markets Fund IV, has been converted into equity shares of the face value of Rs.10 each at a premium of Rs. 130 each on 18 September, 2014 and accordingly 5,038,168 equity shares of Rs. 10/- each has been allotted to Templeton Strategic Emerging Markets Fund IV.

(iv) Details of shares held by each shareholder holding more than 5% shares:

Note 1 Previous year''s figures

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


Mar 31, 2015

1 Corporate information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act. The Company is primarily engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Indian Made Foreign Liquor (IMFL), Bulk Alcohol and Franchise Bottling.

2.1 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises De velopment Act, 2006

There are no dues to enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). Further no interest has been paid under the terms of MSMED Act, 2006. Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

2.2 Details on derivative instruments and unhedged foreign currency exposures:

Forward exchange contracts, which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency available at the settlement date of certain receivables.

3.1 Defined contribution plans

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 32.43 lac (Year ended 31 March, 2014 Rs. 29.53 lac) for Provident Fund contributions, and Rs. 2.33 lac (Year ended 31 March, 2014 Rs. 2.89 lac) for Employee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

3.2 Defined benefit plans

The Company's defined benefit scheme represents gratuity scheme for its employees:

The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial statements:

Note 4 Previous year's figures

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


Mar 31, 2014

1 Corporate information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act,1956. The Company is primarily engaged in the business of manufacture and sale of Indian Made Indian Liquor (IMIL), Indian Made Foreign Liquor (IMFL), Bulk Alcohol and Franchise Bottling.

Note 2 Additional information to the financial statements

2.1 Money received against share warrants

The Board of Directors of the Company at their meeting held on 7January, 2013 and as approved at its Extra ordinary General Meeting held on 6 February, 2013 have resolved to create, offer, issue and allot up to 1,428,572 warrants, convertible into e quivalent number of equity shares of Rs.10 each on a preferential allotment basis, pursuant to Section 81(1A) of the Comp anies Act, 1956, at a conversionp rice of Rs.140 per equity share of the Company, arrived at in accordance with the SEBI Guidelines in this regard and subsequently 763,359 warrants were allotted on 19 March, 2013 to the Promoters and 25% application money amounting to Rs.267.17 lacs was received from them. The warrants may be converted into equivalent number of shares on payment of the balance amount at any time on or before 18 September, 2014. In the event the warrants are not converted into shares within the said period, the Company is eligible to forfeit the amounts received towards the warrants.

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

(Rs. in lacs)

As at As at 31 March, 2014 31 March, 2013

(i) Contingent liabilities

(a) Claims against the Company not acknowledged as debt Excise duty matters 180.81 38.75

Income tax matters 215.44 -

Other matters 75.86 -

(b) Guarantees

Guarantees by bank on behalf of company 367.33 13.79

(ii) Commitments

(a) Estimated amount of contracts remaining to be executed on capital account and not provided for

Tangible assets 233.09 -

2.3 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

There are no dues to enterprises as defined under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act, 2006). Further no interest has been paid under the terms of MSMED Act, 2006. Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. This has been relied upon by the auditors.

2.4 Details on derivative instruments and unhedged foreign currency exposures:

Forward exchange contracts, which are not intended for trading or speculative purposes but for hedge purposes to establish the amount of reporting currency available at the settlement date of certain receivables.

3.1 Defined contribution plans

The Company makes Provident Fund and Employee State Insurance Scheme contributions which are defined contribution plans, for qualifying employees. Under the Schemes, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognised Rs. 29.53 lacs (Year ended 31 March, 2013 Rs.34.10 lacs) for Provident Fund contributions, and Rs.2.89 lacs (Year ended 31March, 2013 Rs.3.20lacs) forEmployee State Insurance Scheme contributions in the Statement of Profit and Loss. The contributions payable to these plans by the Company are at rates specified in the rules of the schemes.

3.2 Defined benefit plans

The Company''s defined benefit scheme represents gratuity scheme for its employees:

The following table sets out the funded status of the defined benefit scheme and the amount recognised in the financial

The discount rate is based on the prevailing market yields of Government of India securities as at the balance sheet date for the estimated term of the obligations.

The estimate of future salary increases considered, takes into account the inflation, seniority, promotion, increments and other relevant factors.

* Information pertaining to experience adjustment have been furnished to the extent available with the Company.

Segment information

Based on the guiding principles given in Accounting Standard on ''Segment Reporting'' (AS-17), the Company''s primary business segment is Industrial and Potable Alcohol. The alcohol business incorporates product groups viz. IMIL, IMFL, Bulk Alcohol and Franchise operations, which mainly have similar risks and returns. As the Company''s business activity falls within a single primary business segment the disclosure requirements of AS -17 in this regard are not applicable.

Note 4 Related party transactions

4.1 Details of related parties:

Description of relationship Names of related parties

(i) Associates Chandbagh Investments Limited

(ii) Key Management Personnel (KMP) Mr. Ajay Kumar Swarup

Mr. Shekhar Swarup

Dr. Bhaskar Roy

Mr. Manik Lal Dutta

Mr. R.D Aggarwal- Up to November 11, 2013

(iii) Relatives of Key Management Personnel (KMP) Mrs. Madhavi Swarup- Wife of Mr. Ajay Kumar Swarup

Mrs. Saroj Rani Swarup- Mother of Mr. Ajay Kumar Swarup Mrs. Pratima Roy- Wife of Dr. Bhaskar Roy Mrs. Anju Aggarwal- Wife of Mr. R.D Aggarwal

(iv) Entities in which KMP can exercise Biotech India Limited

significant influent Chandbagh Investments Limited

GRAS education and training Services Private Limited

Himalayan Spirits Limited

Globus Spirits (Jharkhand) Limited

Globus Trois Freres India Limited

Globus Feeds Private Limited

V C technologies Private Limited

Northen India Alcohol Sales Private Limited

Rajasthan Distilleries Private Limited

Associated Distilleries Limited

4.2 Based on projections for future taxable income, which has been approved by the Board of Directors, Minimum Alternate Tax (MAT) Credit of Rs.1,287.98 lacs (including Rs.1,195.95 lacs pertaining to earlier years) has been recognised during the year.

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


Mar 31, 2013

Corporate Information

Globus Spirits Limited (the Company) is a public Company domiciled in India and incorporated under the provisions of the Companies Act,1956. The Company is primarily engaged in the business of alcohol industry including Indian Made Indian Liquor( IMIL), Indian Made Foreign Liquor( IMFL), IMFL Francise Bottling and Bulk Alcohol.

1. Taxes on Income

(i) Current tax is the provision made for the MAT payable during the year in accordance with the provisions u/s 115JB of the Income Tax Act, 1961

(ii) Current Tax is determined as per the provisions of the Income Tax Act, 1961 in respect of Taxable Income for the year. Deferred tax is recognized, on timing differences, being the difference resulting from the recognition of items in the fnancial statements & in estimating its current income tax provision. Deferred Tax Assets and Deferred Tax Liabilities are computed by applying tax rates and tax laws that have been enacted or substantively enacted by the Balance Sheet Date.

2. Related party disclosures as required in terms of “Accounting Standard - 18” are given below :

(i) Key Management Personnel Sh. Ajay K. Swarup

(ii) Associate Companies M/s Biotech India Limited

M/s Rajasthan Distilleries Pvt. Ltd.

M/s Associated Distilleries Ltd.

M/s Chandbagh Investments Ltd. (No transaction done during the year)

3. Contingent Liabilities not provided for:-

a Contingent Liabilities not provided in the book of account of Rs.38,75,173/- Security executed in favour of Excise authorities for bottling case pending before the high court for Punjab & Haryana which is related to Demerged undertaking of M/s Associated Distilleries Ltd.

b Bank Guarantees issued by the Company in favour of various parties amounting to Rs.1,378,820/-

4. Deferred Revenue Expenditure

“Deferred revenue- Brand Promotion Expenses” appearing in Asset side in the Balance Sheet are the expenditure incurred on promoting company''s new IMFL brands already launched during the year 2007 and which have perpetual beneft to the company and thus it was shown under the head Deferred revenue- Brand Promotion Expenses, which is being written off in fve years & the current year being the ffth year, thus it is fully written off.

5. SSI Liabilities

As explained, there is no amount due to small-scale industries over Rs. 1 lac shown under the head “sundry Creditors”

6. Balances of Debtors, Creditors and Advances to and from parties are subject to Reconciliation and confrmation.

7. In the opinion of the Board, the value of Current Assets, Loans & Advances in the ordinary course of business will not be less than the value at which they have been stated in the Balance Sheet.

8. The proft & loss account and Balance sheet comply with Accounting Standard referred to in section 211 (3C) of the Companies Act, 1956

9. Insurance claim which are of not signifcant value are accounted for on receipt basis.

10. An Inter unit transaction of Rs.6075.51lacs for the FY2012-13 (Rs.5045.25lacs for the FY2011-12) towards generation & consumption of steam & energy has been deducted from total turnover & also deducted from manufacturing expenses under the sub-heading consumption of power & fuel. However till the period ending 31st December 2012, we used to include the fgure for “generation & consumption of steam & energy” in the turnover side & consumption of power & fuel side. Hence the new practice has been adopted & given effect in the abovementioned quarter ending & year ending results for their proper comparision.

11. Previous year fgures have neen regrouped where necessary to conform to revised schedule VI requirement


Mar 31, 2012

(a) Contingent Liabilities and Contingent Assets (AS-29)

Contingent Liabilities not provided in the book of account of Rs.SSJSJTS/- Security executed In favour of Excise authorities for bottling case pending before the high court for Punjab & Haryana which Is related to Demerged undertaking of IWs Associated Distilleries Limited.

(b) SSI Liabilities

As explained' there Is no amount due to small-scale industries over Rs.1 Sac shown under the head "sundry Creditors*

(c) Cash Flow Statement

Cash flows are reported using the indirect method' whereby profit before tax is adjusted for the effects of transactions Of a non-cash nature' any deferrals Or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from operating' investing and financing activities of the Company are segregated.

(b) Foreign Currency Transaction

(I) Transaction denominated in foreign currants a re recorded at the exchan gerate prevai tin g on the date of the transaction or that approximates the actual rate at the date of the transaction.

(II) Monetary Items denominated in foreign currencies at the year end are restated at year end rates' in case of items which are covered by forward exchange contracts' the difference between the year end rate and rate on the date of the contract is recognized as exchange difference end the premium paid on forward contracts is recognized over the life of the contract.

(e) Capital commitment related to capacity expansion is Rs. S1 S.94 lac as on 31st March 2012.

(f) Related party disclosures as required in terms of "Accounting Standard -18th are given below:

(i) Key Ma pavement Personnel Sh. Ajay K. Swarup

(ii) Associate Companies M/s Biotech India Limited

M/s Rajasthan Distilleries Pvt. Ltd.

M/s Rambagh Estates Pvt. Ltd.

M/s Chandbagh Investments Ltd. (No transaction done during the year)

(g) Previous year figures have been regrouped where necessary to conform to revised schedule VI requirement

(h) Balances of Debtors' Creditors and Advances to and from parties are subject to Recndliation and confirmation'

(i) In the opinion of the Board' the value of Current Assets' Loans & Advances in the ordinary course of business will not be less than the value at which they have been stated in the Balance Sheet.

(j} The profit & loss account and Blaine sheet com ply with Accountings Standard nefierre d to in section 211 (3C) of the Companies Act 1956 insurance claim which are of not significant value are accounted for on receipt basis.

k. attached to equity sharw*

The company has only one class of equity shares having a par value of Rs. 10 per Shane. Each holder of equity scares Is entitled to one vote per share. The company declares and pays dividend In Indian Rupees. The dividend proposed by the board of directors is subject to approval of the shareholder* in the ensuing Annual General Meeting.


Mar 31, 2011

1. Demerger of Demerged undertaking of Associated Distilleries Limited(Demerged Company) into Globus Spirits Limited (Resulting Company)

During the current year Pursuant to the scheme of Arrangement provided for demerger of Demerged Undertaking of Associated Distilleries Limited ("Transferor Company") into Globus Spirits Limited ("Transferee Company") which has been applied u/s 391 to 394 and other relevant provisions of the Companies Act, 1956 vide CA (M) No. 37 of 2011 dated 17th February 2011 and sanctioned by Hon'ble High court of Delhi vide order dated 24th August 2011, the demerger has been taken place w.e.f. 01st April 2010 ("The Appointed Date"). The salient particulars of the scheme and the related accounting treatment are as under: · Pursuant to the scheme, the entire undertaking of Associated Distilleries Limited consisting of assets situated at

Hisar - Haryana (except Freehold Land, Road, Building and Mandir) and liability stood transferred and become vested with the Globus Spirits Limited. The following assets & liabilities of Demerged undertaking of Associated

On and from the appointed dated, all the assets (except Freehold Land, Road, Building and Mandir) and liabilities pertaining to the Demerged Company have been recorded in the book of the company At Book Value.

Pursuant to Demerger, Upon Scheme becoming effective and without any further application, act or deed, the Transferee Company, in consideration of the transfer and vesting of the Demerged Undertaking in the Transferee Company, the Transferee Company shall issue and allot to the members of the Transferor Company ("Members"), 6 (Six) equity shares of Rs. 10/- each for every 1 (one) fully paid equity share of Rs.10/- each held by the Member whose names appear in the Register of Members of the Transferor Company, as on the Record Date, fixed in respect of the Transferor Company or to such of their respective heirs, executors, administrators or other legal representatives or other successors in title as may be recognized by the Board of Transferor Company. Hence Rs.3,24,00,000/- has been shown in the share capital suspense account, as 32,40,000 equity shares of Rs.10/- each to be allotted on 03/10/2011 to the shareholders of transferor company holding 5,40,000 equity shares of Rs.10/- each in Associated Distilleries Limited.

The excess of aggregate value of asset over aggregate value liabilities of the Demerged Undertaking, over the the aggregate value of the equity share issued and allotted is Rs.667,46,687 which is transferred to Revenue Reserve as specified in para 16(d) of the Scheme approved by Hon'ble High court of Delhi.

On and from the appointed dated, all the assets (except Freehold Land, Road, Building and Mandir) and liabilities pertaining to the Demerged Company have been recorded in the book of the company At Book Value. · Pursuant to Demerger, Upon Scheme becoming effective and without any further application, act or deed, the Transferee Company, in consideration of the transfer and vesting of the Demerged Undertaking in the Transferee Company, the Transferee Company shall issue and allot to the members of the Transferor Company ("Members"), 6 (Six) equity shares of Rs. 10/- each for every 1 (one) fully paid equity share of Rs.10/- each held by the Member whose names appear in the Register of Members of the Transferor Company, as on the Record Date, fixed in respect of the Transferor Company or to such of their respective heirs, executors, administrators or other legal representatives or other successors in title as may be recognized by the Board of Transferor Company. Hence Rs.3,24,00,000/- has been shown in the share capital suspense account, as 32,40,000 equity shares of Rs.10/- each to be allotted on 03/10/2011 to the shareholders of transferor company holding 5,40,000 equity shares of Rs.10/- each in Associated Distilleries Limited. · The excess of aggregate value of asset over aggregate value liabilities of the Demerged Undertaking, over the the aggregate value of the equity share issued and allotted is Rs.667,46,687 which is transferred to Revenue Reserve as specified in para 16(d) of the Scheme approved by Hon'ble High court of Delhi.

With effect from the Appointed Date and upto the Effective Date:- The Transferor Company shall be deemed to have been carrying on all business and activities relating to the Demerged Undertaking and stand possessed of the properties to be transferred to Transferee Company for and on account of and in trust for Transferee Company .account of and in trust for Transferee Company .

All income, receipts, profits of whatsoever nature accruing to the Transferor Company or losses,expenses and payments of whatsoever nature arising or incurred by it relating to the Demerged Undertaking shall for all purposes, be treated as profits, income, receipts, or losses, expenses, payments, as the case may be, of the Transferee Company .

Tax Deducted at Source (TDS), if any, by the Transferee Company under the Income Tax Act, in respect of the payments made by the Transferee Company to the Transferor Company, on or after the Appointed Date, which pertain to the Demerged Undertaking, shall be treated as advance tax paid by the Transferee Company and accordingly, the Transferee Company shall be entitled to claim the the credit for such TDS as advance tax paid , notwithstanding the fact that the challans or deposit receipts are towards TDS. The TDS certificate(s), if any, issued by the Transferee Company to the Transferor Company for such payments shall stand cancelled without any further act or deed and no credit on such TDS certificates shall be made available to the Transferor Company on the Scheme becoming effective.

It is specifically declared that the tax deducted at source (TDS) from the income of the Demerged Undertaking of the Transferor Company, in terms of the provisions of Chapter XVII of the Income Tax Act or any advance tax paid by the Transferor Company in respect of the Demerged Undertaking, for the period beginning from the Appointed Date and ending as on the Effective Date, shall be deemed to be tax paid by the Transferee Company and the Transferee Company shall be entitled to claim credit for such taxes deducted or paid, whether by way of TDS or advance tax, notwithstanding that certificates / challans or other documents for payment of such taxes are in the name of the Transferor Company and not in the name of the Transferee Company.

2. Segment Reporting

In the opinion of the management, company is involved in only one type of product Industrial & Potable Alcohol as envisaged by AS 17 'Segment Reporting', prescribed by the Companies (Accounting Standards) Rules, 2006. Accordingly, no separate disclosure for segment reporting is required to be made in the financial statements of the Company.

Secondary segmentation based on geography has not been presented as the Company operates primarily in India and the Company perceives that there is no significant difference in its risk and returns in operating from different geographic areas within India.

3. Deferred Revenue Expenditure:

"Deferred revenue- Brand Promotion Expenses" appearing in Schedule G in the Balance Sheet are the expenditure incurred on promoting company's new IMFL brands already launched during the year 2007 and which will give perpetual benefit to the company and thus it is shown under the head Deferred revenue- Brand Promotion Expenses, which is being written off in five years.

4. Related party relationships and transactions

In accordance with the Accounting Standards (AS-18) on Related Party Disclosures, where control exists and where key management personnel are able to exercise significant influence and, where transactions have taken place during the year, along-with description of relationship as identified, are given below:-

A. Relationships

I. Subsidiary Company NIL

II. Joint Venture/Joint Control Associates NIL

III. Key Management Personnel

Name Designation

Sh. Ajay K. Swarup Managing Director

IV. Associates

M/s Chandbagh Investments Limited (Holding Company) (no transaction has been entered into during the period) M/s Rambagh Estates Private Limited.

5. Taxation

A) Current tax is the provision made for the MAT payable during the year in accordance with the provisions under section 115JB of the Income Tax Act, 1956.

B) Deferred tax is recognized, on timing differences, being the difference resulting from the recognition of items in the financial statements & in estimating its current income tax provision.

C) Deferred tax assets are recognized on unabsorbed depreciation to the extent there is virtual certainty supported by convincing evidence & on others to extent that there Is reasonable certainty of their realization

D) Deferred tax assets & liabilities are measured using the tax rates & the laws that have been enacted or substantially enacted at the balance sheet date.

6. Impairment of Assets

The indicators listed in paragraph 8 of Accounting Standard (AS)-28 " impairment of assets " issued by Institute of Chartered Accountants of India have been examined & on such examination , it has been found that none of the indicators are present in the case of company . There is no indication of a potential impairment loss, so estimation of recoverable amount has not been made.

7. Contingent Liability:

Contingent Liabilities not provided in the book of account of Rs.38,75,173/- Security executed in favour of Excise authorities for bottling case pending before the high court for Punjab & Haryana which is related to Demerged undertaking of M/s Associated Distilleries Limited.

8. Guarantees:

The FDR's amounting to Rs.28,03,188/- are under the lien of bank. NSC of Rs.50,000/- is with directorate of Industries which is also related to Demerged undertaking of M/s Associated Distilleries Limited.

9. In the opinion of the Board, the value of Current Assets, Loans & Advances in the ordinary course of business will not be less then the value at which they have been stated in the Balance sheet.

10. Balances of Debtor & creditors and Advances to and from parties are subject to Reconciliation & Confirmation which pertains to both Demerged company & Resulting company.

11. The amount falling due with in one year in respect of secured loans is Rs. 5,08,65,262/- which pertains to both Demerged company & Resulting company.

12. There is no amount due to small-scale industries over Rs.1 lac shown under the head "Sundry Creditors"

13. The profit & loss account and Balance sheet comply with accounting standards referred to in section 211(3C) of the companies Act 1956.

14. Insurance claims which are of not significant value are accounted for on receipt basis.

15. Figures for the financial year 2010-2011 are post-demerger of demerged undertaking of Associated Distilleries Limited into Globus Spirits Limited & hence not comparable with those of the previous year figures.

16. Figures has been rounded off to the nearest rupee.

17. Other information pursuant to para 3 to 4D of part–II of schedule VI of the Companies Act 1956 has not been furnished as the same is not applicable.


Mar 31, 2010

1. In the opinion of the Board, the value of Current Assets, Loans & Advances in the ordinary course of business will not be less then the value at which they have been stated in the Balance sheet

2. Balances of Debtor & creditors and Advances to and from parties are subject to Reconciliation & Confirmation

3. The amount falling due with in one year in respect of secured loans is Rs.4,86,00,000/-.

4. The profit & loss account and Balance sheet comply with accounting standards referred to in section 211 (3C) of the companies Act 1956.

5. Accounting Standard (AS) -17 "Segment Reporting " is not applicable in case of company because company is involved in only one type of product Industrials Potable Alcohol.

6. There is no amount due to small-scale industries over Rs.1 lac shown under the head "sundry Creditors"

7. "Deferred revenue- Brand Promotion Expenses" appearing in Schedule G in the Balance Sheet are the expenditure incurred on promoting companys new IMFL brands already launched during the year 2007 and which will give perpetual benefit to the company and thus it is shown under the head Deferred revenue- Brand Promotion Expenses, which is being written off in five years.

8. During the year the company has raised Rs.75crores through the initial public issue of 75,00,000 equity shares of Rs.10/- each at a premium of Rs.90/- per equity share for the purpose of expansion of capacity & modernization of existing distilleries. The expenditure incurred towards IPO to the tune of Rs. 12,57,83,784/- is being shown under the head Capital work-in-progress & it will be capitalized as & when the upcoming project will be completed.

9. In accordance with the Accounting Standards (AS-18) on Related Party Disclosures, where control exists and where key management personnel are able to exercise significant influence and, where transactions have taken place during the year, along-with description of relationships identified, are given below :-

A. Relationships

I. Subsidiary Company NIL

II. Joint Venture/Joint Control Associates NIL

III. Key Management Personnel

Name Designation

Sh.AjayK. Swarup Managing Director

IV. Associates

M/s Chandbagh Investments Limited (Holding Company) (no transaction has been entered into during the period)

M/s Associated Distilleries Ltd. (ADL)

M/s Rambagh Estates Private Limited.

10. Taxation

A) Current tax is the provision made as per the normal income tax rate.

B) Deferred tax is recognized, on timing differences, being the difference resulting from the recognition of items in the financial statements & in estimating its current income tax provision.

C) Deferred tax assets are recognized on unabsorbed depreciation to the extent there is virtual certainty supported by convincing evidence & on others to extent that there Is reasonable certainty of their realization

D) Deferred tax assets & liabilities are measured using the tax rates & the laws that have been enacted or substantially enacted at the balance sheet date.

11. The indicators listed in paragraph 8 of Accounting Standard (AS)-28" impairment of assets" issued by Institute of Chartered Accountants of India have been examined & on such examination , it has been found that none of the indicators are present in the case of company. There is no indication of a potential impairment loss, so estimation of recoverable amount has not been made.

12. Insurance claims which are of not significant value are accounted for on receipt basis.

13. Previous years figures has been regrouped, rearranged & reworked wherever necessary to make them comparable with the current year figures.

14. Figures has been rounded off to the nearest rupee.

15. Other information pursuant to para 3 to4D of part-II of schedule VI of the Companies Act 1956 has not been furnished as the same is not applicable.

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