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Notes to Accounts of Gujarat Borosil Ltd.

Mar 31, 2015

In March 2012, the Company had issued 90,00,000 9% Cumulative Non-Convertible Redeemable Preference Shares of Rs.100/- each fully paid up.

Preference Shares carry a dividend of 9% , when declared by the company and redeemed at the end of seven years i.e.. on 16.03.2019.

The Preference shareholder has acquired voting rights due to non-payment of dividend for two years.

The holder of Preference Shares will have priority over Equity Shares in the payment of dividend and repayment of capital, in the event of liquidation of the company before redemption of Preference Shares,

Note : 1. Foreign Currency Term Loan - ECB from Banks is secured by way of mortgage of all the fixed assets of the Company both present and future, ranking pari passu and by way of Hypothecation of all the moveables (save & except book debts) present & future, subject to prior charges created in favor of Company's bankers for working capital facilities. The same is further secured by personal guarantee of two directors.

2. Repayment of Foreign Currency Term Loan - ECB due within one year is Rs 1100.25 Lacs shown under Other Current Liabilities.

3. Foreign Currency Term Loan - ECB is repayable in 10 half yearly structured installments from October 2012

4. Interest rate of Foreign Currency Term Loan - ECB is 445 bps above Libor.

Note : 1. Working Capital Facility from Banks is secured by Hypothecation on all stocks and book debts of the Company and additionally secured by way of a second charge on Fixed Assets of the Company.

The said facilities are further secured by personal guarantee of two Directors.

2. Interest rate on Working Capital Facility is BOB Base Rate 3% i.e.13.25%.

Note 1: Capital Work in Progress includes Capital goods inventory of Rs. 139.35 Lacs (Previous year 143.86 lacs).

2: Additions include Rs. 49.05 Lacs capitalised on account of exchange rate difference (Net) on foreign currency loan used for financing fixed assets.

3. Depreciation for the year for previous year increased by Rs 55.38 lacs due to change in useful life -Refer note no 33.

* Store consumption includes stores items W/off of Rs. 147.07 lacs Less provided already Rs. 124.05 Lac Net Rs. 23.02 Lacs.

5. No provision for MAT has been made in view of set off permitted against brought forwarded book loss.

6. A. Contingent liabilities not provided for:-

Rs. In Lacs

S. Particulars 2014-15 2013-14 No.

a) Letters of Credit outstanding

* Local 104.00 85.00

* Foreign 270.53 54.40

b) Claims against the Company not acknowledged as debt 32.67 23.17

c) i) Excise matters relating to valuation in appeal before Supreme Court From February 1999 to June 2005 455.07 455.07

Equivalent amount of penalty, interest 797.06 797.06

The company is legally advised that the disputed demands will not be sustained in view of :-

a) The judgment by supreme Court dismissing appeal of the department for the period July 2006 to June 2007 in its own case

b) Favorable decision of Commissioner (Appeal) for the period July 2005 to June 2006, and

c) Various legal pronouncements in similar other matters.

A sum of Rs. 589.33 Lacs paid under protest in respect of i) above dispute demand has been shown as advances recoverable.

ii) Excise matters relating to denial of Cenvat Credit on certain inputs in appeal before Commissioner-Surat From August 2009 to January 2011. NIL 19.33

Equivalent amount of penalty. NIL 19.33

d) Income tax matters in Appeal filed by the Company before

i. CIT-Appeals in respect of assessment year 1997-98 on account of 347.65 344.22 penalty Rs.41.38. Lacs.

ii. CIT-Appeal in respect of assessment year 2011-12 and 2012-13 On account of disallowances / additions totaling to Rs.638.51 Lacs.

iii. Gujarat High Court in respect of assessment year 2003-04 on account of carry forward of unabsorbed depreciation Rs.246.78.

iv. ITAT, Ahmedabad in respect of A.Y. 2010-11 on account of Disallowances totaling to Rs. 15.76 Lacs.

(previous year total disallowances/ additions of Rs. 932.34 Lacs)

e) Income tax matters in Appeal filed by the department before Tribunal in respect of assessment year 2005-06, 2008-09, 2009-10 and 2010-11. 296.35 290.52

f) Appeal filed by the Company before Jt. Commissioner, Vadodara in 291.87 291.87

Sales tax matter relating to purchase of fuel and Additional Tax for financial 258.97 258.97 years 2000-01, 2002-03 and 2004-05 Interest and penalty thereon.

No liability is expected in view of judicial pronouncement by High Court in similar matter of other Companies.

g) Service Tax matters in appeal before Comm. (Appeal)/CESTAT for the 0.74 18.33 financial years 2007-08 to 2011-12. 0.74 14.85

Interest & Penalty thereon.

h) Disputed amount of gas transportation charges including interest - matter pending in appeal before High Court 44.13 44.13

i) Bill discounted with banks (Since realized) 113.23 192.84

J) Bank Guarantees 164.05 164.05

7. Appeal filed by Excise department before CESTAT in 2010 against excise refund given for March 1996 to September 1999 and the appeal filed before Commissioner (Appeal) in 2009 against interest thereon allowed to the Company are pending for hearing.

8. As per revised Accounting Standard-15 'Employee Benefits', the disclosure of Employee benefits as defined in the Accounting Standard are given below:-

Defined Contribution plan:

Contribution to defined contribution Plan, recognized as expense for the year are as under:-

Rs. In Lacs Particulars 2014-15 2013-14

Employer's Contribution to Provident Fund 67.55 62.38

The contribution to provident fund is made to respective Regional Provident Fund Managed by Provident Fund Commissioner. From March 2014 the contribution for all the excluded employees also is made with Regional Provident Fund Commissioner (RPFC). Company's request to RPFC to allow transfer of accumulated amounts in fund managed by them has been allowed and the funds have been transferred to RPFC and credited to respective employees.

Defined Benefit Plan:

The Employees gratuity Fund Scheme is managed by Birla Sun Life Insurance Corporation. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as the gratuity.

Leave Encashment (Unfunded):

In accordance with revised AS-15 'Employee Benefits', the company has provided the liability on actuarial basis.

As per the actuarial certificate (on which auditors have relied), the details of the employee benefits plan - Leave Encashment are:

9. The estimated amount of contracts remaining to be executed on capital account and not provided for Rs.148.60 Lacs (net of advances- Rs125.97 lacs). Previous year Rs. 17.28 Lacs (Net).

10. The Company has filed legal case in Amsterdam District court against one of its export debtors. The decision of court in the case against directors for their personal liability which came in favor of the Company was reversed by the Appeal court in August 2014. The debtor has filed for bankruptcy and as per the information gathered from the office of liquidators the secured liability of bank is much more than the possible value of assets. In the simultaneous civil suit for recovery filed by the Company the court decided to hear only the personal liability matter in view of bankruptcy of the debtor and the decision of the hearing is awaited. Taking into account all the factors it has been decided to make a provision for the entire amount due as the same is doubtful of any recovery. The entire amount of Rs 569.25 Lacs outstanding, as per books, net of claims has been treated as doubtful and a provision of equal amount has been made in the accounts for the year after compliance of FEMA provisions the debt will be written off.

11. Effective from 1st April, 2014, the Company has provided depreciation with reference to the useful life of tangible assets as specified in Schedule II to the Companies Act, 2013. Accordingly, the carrying amount, net of residual value , as on that have been depreciated over the revised remaining useful life of the respective asset. As a result, the charge of depreciation is higher by Rs 72 lacs for the year. Further, an amount of Rs 38 lacs (net of deferred tax of Rs 17 lacs) on account of depreciation on assets whose useful life is already exhausted as on 1st April 2014 has been adjusted to the opening balance of Loss in the Profit & Loss account.

12. No dues and unpaid balance at the end of the year to falling within the definition of entities under the Micro, Small and Medium Enterprises Development Act, 2006. There were also not claim for Interest on dues payment

13. The settlement with Worker's Union expired on 31st December, 2009; Company has signed new settlement with workers on 29/03/2013 w.e.f. January 2010. The lump sum and wage increase effective January 2013 payable to worker who has still not accepted the settlement amounting to Rs. 144.37 Lacs is lying in accounts as on 31.03.2015 (Including Rs 38.97 Lacs provided for the year).

14. The Company had in the previous year sold/discarded certain plant and machinery of Sheet Glass plant and accounted for the surplus as income. A portion of these fixed assets amounting to Rs148.49 Lacs not lifted by the buyer are carried in the accounts at the sales value. The buyer has disputed forfeiture of deposit and matter is in Court. The company expects to realize the balance amount in full and considers no necessity to make any provision against the same.

15. The Company's application filed in September 2011 for electricity duty exemption w.e.f. May 2011 on generation of electricity from captive power plant for use in the Solar glass plant is pending before the Government for disposal as per the direction of the Gujarat High Court to reconsider the same. Under the old policy the exemption is available for new units/undertakings. The Company has also filed application in October, 2014 under the new policy announced in July 2014 in which there is an exemption w.e.f 1.4.2013 for additional units set up by existing units. Hearings are in progress and accounting of duty exemption will be done after disposal of the Company's applications.

16. Related party disclosures under accounting standard 18:

(A) list of related parties:

Associate Companies

1. Borosil Glass Works Ltd. 2. Borosil International Ltd. 3. Broad field Holdings Ltd. 4. Cycas Trading LLP 5. Fennel Investment & Finance Pvt. Ltd. 6. Gujarat Fusion Glass LLP 7. Sonargaon Properties LLP 8. Swapan Properties LLP 9. Vyline Glass Works Ltd. 10. Window Glass Ltd.

Key Managerial Personnel

Mr. B.L.Kheruka Mr. Ashok Jain, Whole-time Director Mr. Sunil Roongta, CFO Mr. Kishor Talreja, Company Secretary

Other parties related to Key Personnel Mrs. Kiran Kheruka

17. The Company's business activity falls within a single primary business segment viz. Manufacture of Fl glass. As such, there are no separate reportable segments as per Accounting Standard 17.

18. Quantitative details of raw materials which individually account for 10% or more of the total value of raw materials consumed:

19. Value of Imported and Indigenous Raw Material and Components consumed percentage of each to total consumption

20. Previous year figures have been regrouped and rearranged wherever necessary.


Mar 31, 2014

1. A. a) Re-opening notice for Income tax for assessment year 2008-09 was challenged by Company in Gujarat High Court by Special Civil Application and Stay was received by the Company. In similar matter for assessment year 2007-08 the High Court has admitted Review Petition of department as the matter was decided in favor of Company. Further hearings are pending.

b) Appeal filed by Excise department before CESTAT in 2010 against excise refund given for March 1996 to Sept 1999 and the appeal filed before Commissioner (Appeal) in 2009 against interest thereon allowed to the Company are pending for hearing.

2. The estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 2323 thousands (net of advances- Rs. 1728 thousands). Previous year Rs. 11355 thousands (Net).

3. An award was received in the arbitration matter with GAIL India Ltd. in an earlier year involving disputes regarding

i) revision in Capital cost of pipe line by Rs. 2334 thousands and consequent higher transportation charges; and

ii) additional transportation charges from January, 1997 under the supplementary agreement for additional quantity of Gas which was not recognized as income as the award was not accepted by GAIL. However as a part of revision in transportation/compression charges done by GAIL for various customers, a sum of Rs. 38546 thousand received by the Company in the F.Y 2007-08 was shown as exceptional income. The balance relief as per award has not been accounted. The appeal filed by GAIL in the District Court Bharuch against the majority Arbitration award has been decided against the Company and an appeal filed by Company before Gujarat High Court was admitted on 29/03/2012 and is pending hearing.

4. No dues and unpaid balance at the end of the year to falling within the definition of entities under the Micro, Small and Medium Enterprises Development Act, 2006. There were also no claims for Interest on dues payment.

5. The Company has filed legal case in Amsterdam District court against one of its export debtors and has been able to receive orders attaching personal properties of the Directors. The civil suit for recovery of the outstanding is going on in the court. The amount of Rs. 56925 thousands due, as per books, net of claims has been shown as doubtful but recoverable pending outcome of the recovery suit. The amount has been stated at the exchange rate prevailing on 31.3.2013.

6. The settlement with Worker''s Union expired on 31st December, 2009. Company has signed new settlement with workers on 29/03/2013 w.e.f. January 2010. The lump sum and wage increase effective January 2013 payable to workers who have still not accepted the settlement amounting to Rs.6538 thousands is lying in accounts as on 31.3.2013. A further sum of Rs. 4457 thousands payable for this year on this account has been provided in the accounts.

7. The Company was making PF contribution for excluded employees to a Trust until February 2014. The Trust was recognized by Income tax authorities. In view of the deadline requiring the trust to obtain approval of Regional Provident Fund Commissioner (RPFC) nearing expiry and considering that the fund was catering to a small number of employees the Company has been advised that obtaining the approval was extremely unlikely and may result in withdrawal of recognition and the employees will be deprived of tax benefit, hence it was decided to wind up the Trust & to liquidate all investments of the Trust ie. Securities / Mutual Funds units / Special Deposits be sold in the Market and deposit the said amount with RPFC in the account of the respective employees and start making contribution of March 2014 salary with RPFC. In view of the depressed prices of Govt securities due to prevailing high interest rates, the sale amount realized on sale of securities was lower than the holding value. The shortfall amounting to Rs 2520 thousands has to be made good by the Company and has been provided in the accounts for the year and charged as contribution to PF.

8. The Company has sold/discarded certain plant and machinery of Sheet Glass plant and accounted profit of Rs. 47292 thousands arising therefrom as exceptional income. The remaining part of the fixed assets of sheet glass plant is in use and the value is higher than the book value. Hence no impairment loss has been provided for in terms of Accounting standard AS-28 of the ICAI.

9. The Company has applied for electricity duty exemption on generation of electricity from captive power plant which is used in the Solar glass plant. Under the policy the exemption is available for new units/ undertakings. The application was rejected without giving sufficient hearing. Company approached Gujarat HC and the matter is now being re-examined by Government of Gujarat as per directions of HC.

10. Related party disclosures under accounting standard 18 :

(A) list of related parties: Associate Companies

1. Borosil Glass Works Ltd.

2. Window Glass Ltd.

3. Swapan Properties LLP

4. Fennel Investment & Finance Pvt. Ltd.

5. Broadfield Holdings Ltd.

6. Sonargaon Properties LLP

7. Gujarat Fusion Glass LLP (w.e.f 3.4.2014)

8. Vyline Glass Works Ltd.

9. Borosil International Ltd.

10. Cycas Trading LLP

Key Managerial Personnel

Mr B.L.Kheruka

Mr. Ashok Jain, Whole-time Director

Other parties related to Key Personnel

Mrs Kiran Kheruka Mrs Pratibha Jain

11. The Company''s business activity falls within a single primary business segment viz. Manufacture of Flat glass. As such, there are no separate reportable segments as per Accounting Standard 17.

12. Previous year figures have been regrouped and rearranged wherever necessary.


Mar 31, 2013

1. No provision for Income Tax/MAT has been made in view of loss for the year.

2. The Company has accounted for estimated credit, towards expected Export Benefits entitlements amounting to Rs.1823 thousands under the head other income in respect of exports. Variation, if any on actual receipt/utilization of licenses will be dealt with in the accounts of that year.

3. The estimated amount of contracts remaining to be executed on capital account and not provided for Rs.14002 thousands (net of advances- Rs. 11355 thousands). Previous year Rs. 98991 thousands (Net).

4. An award was received in the arbitration matter with GAIL India Ltd. in an earlier year involving disputes regarding i) revision in Capital cost of pipe line by Rs. 2334 thousands and consequent higher transportation charges; and ii) additional transportation charges from January, 1997 under the supplementary agreement for additional quantity of Gas which was not recognized as income as the award was not accepted by GAIL. However as a part of revision in transportation/compression charges done by GAIL for various customers, a sum of Rs. 38546 thousand received by the Company in the F.Y 2007-08 was shown as exceptional income. The balance relief as per award has not been accounted. The appeal filed by GAIL in the District Court Bharuch against the majority Arbitration award has been decided against the Company and an appeal filed by Company before Gujarat High Court was admitted on 29/03/2012 and is pending hearing.

5. The settlement with Worker''s Union expired on 31st December, 2009. Company has signed new settlement with workers on 29/3/2013 w.e.f. January 2010 and lump sum and wage increase effective January 2013 for amounting to Rs. 9167 thousands has been provided in accounts.

6. A sum of Rs. 68 thousands was due and unpaid at the end of the year to M/s. Rajnikant & Co. falling within the definition of entities under the Micro, Small and Medium Enterprises Development Act, 2006. However, there were no claims for interest on delayed payments.

7. Related party disclosures under accounting standard 18 :

(A) list of related parties: Associate Companies

1. Borosil Glass Works Ltd.

2. Window Glass Ltd.

3. Swapan Properties LLP

4. Fennel Investment & Finance Pvt. Ltd.

5. Broadfield Holdings Ltd.

6. Sonargaon Properties LLP

7. Gujarat Fusion Glass Ltd.

8. Vyline Glass Works Ltd.

9. Borosil International Ltd.

10. Cycas Trading LLP

Key Managerial Personnel

Mr. B.L.Kheruka

Mr. Ashok Jain, Whole-time Director

Other parties related to Key Personnel

Mrs. Kiran Kheruka Mrs. Pratibha Jain

8. The recoverable value of Fixed Assets of Sheet Glass plant is higher than the book value. Hence no impairment loss has been provided for in terms of Accounting standard AS-28 of the ICAI.

9. The Company''s business activity falls within a single primary business segment viz. Manufacture of Flat glass. As such, there are no separate reportable segments as per Accounting Standard 17.

10. Previous year figures have been regrouped and rearranged wherever necessary.


Mar 31, 2012

1. Fixed Assets are recorded at cost of acquisition (Net of Cenvat) inclusive of related expenses thereon towards putting the assets in to use.

2 (i) Foreign currency transactions are recorded at the exchange rate prevailing on the date of transaction.

(ii) All monetary foreign currency assets/liabilities are translated at the rates prevailing on the date of balance sheet.

(iii) The exchange difference between the rates prevailing on the date of transaction and on the date of settlement as also on translation of monetary items at the end of the year (other than those relating to long term foreign currency monetary items)is recognized as income or expense, as the case may be.

(iv) Exchange Rate differences relating to long term foreign currency monetary items, to the extent they are used for financing the acquisition of fixed assets are added to or subtracted from the cost of such fixed assets and amortized over the residual life of the respective fixed assets.

3. Depreciation on all the fixed assets has been calculated at the SLM rates prescribed in Schedule XIV of the Companies Act, 1956 as per notification dated 16-12-1993 and on adjustments on account of foreign currency fluctuation is being calculated on residual life of respective fixed assets.

4. Income and Expenses are accounted for on accrual basis except interest on delayed payments which is accounted on receipt basis.

5. Investments are classified into current and long term investments. Current investments are stated at lower of cost and fair market value. Long term investments are stated at cost. A provision for diminution is made to recognize a decline, other than temporary, in the value of long term investment.

6. (A) Inventories: are valued as under

Raw Materials - At Cost or net realisable value whichever is lower.

Own Cullet - At Cost or net realisable value whichever is lower.

Stores and Spare Parts - At Cost or net realisable value whichever is lower.

Work in Progress - At Cost or net realisable value whichever is lower.

Finished Goods - At Cost or net realisable value whichever is lower.

Traded Goods - At Cost or net realisable value whichever is lower.

(B) Cost Formula Used : - Weighted average or specific identification as applicable.

Due allowance is estimated and made for defective and Obsolete items wherever necessary.

7. An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit & Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting periods is reversed if there has been a change in the estimate of recoverable amount.

8. (i) Sales are net of Sales tax, return and quantity discounts .

(ii) Sale of Goods is recognized when significant risks and rewards of ownership have passed to the buyer.

9. Cenvat on Raw Materials / Stores is credited to respective purchase account on accrual basis. Accordingly, inventory is valued at net of Cenvat benefits.

10. Liability in respect of gratuity & leave encashment to employees is actuarially assessed as at the Balance Sheet date and the incremental /decremental liability arising on such valuation is provided for Projected Unit Credit Method used as Stipulated in AS-15(Revised 2005) to determine the plan Liability as on Valuation date and current Service Cost.

11. Interest and other costs in connection with the borrowing of the funds to the extent related / attributed to the acquisition / construction of qualifying fixed assets ready for its intended use are capitalised.

12. Provisions involving substantial degree of estimation in measurement are recognized when there is a present obligation as a result of past events and it is probable that there will be an outflow of resources. Contingent liabilities are not recognized but are disclosed in the notes.' Contingent Assets are neither recognized nor disclosed in the financial statements.

13. Lease rentals are expensed with reference to lease terms and other considerations.


Mar 31, 2011

1. No provision for Income Tax/MAT has been made for the year in view of loss.

2. Contingent liabilities not provided for:-

Rs. In thousands

2010-11 2009-10

a) Letters of Credit outstanding 17573 29155

b) Claims against the Company not acknowledged as debt 1209 1209

c) Excise matters relating to valuation in appeal before Supreme Court/Commissioner, excise From February 1999 to June "2006 65551 88071 Equivalent amount of penalty, interest & redemption fine 124750 172270 Excise amount on same basis from 1.7.2007 to 31.3.2011. 48454 51687

The Company is legally advised that the disputed demands will not Be sustained in view of the judgment by Supreme Court dismissing Dept's appeal for the period July 2006 to June 2007 in its own case as also various legal pronouncements in similar other matters.

Further a sum of Rs.68933 thousands paid under protest in respect of above disputed demand have been shown as advances recoverable.

d) Income tax matters in Appeals filed by the Company 17290 15554 before CIT-Appeals in respect of Assessment Years 2008-09 on account of disallowances/additions amounting to Rs.43351 thousands (previous year Rs.45762 thousands) and penalty of Rs.2555 thousands in respect of Assessment year 2005-06.

e) Appeal filed by the Company before Jt commissioner in 29187 29187 Sales tax matter relating to purchase of fuel and Additional Tax for F.Y 2000-01, 2002-03 and 2004-05 Interest and penalty thereon. 25897 25897

No liability is expected in view of judicial pronouncement by High Court in similar matter of other Companies.

f) Bills discounted with banks Nil 3732

3. The Company has accounted for estimated credit, towards expected import benefit amounting to Rs.350 thousands under the head raw materials in respect of import entitlements. Variation, if any on actual utilization of licenses will be dealt with in the accounts of that year.

4. The estimated amount of contracts remaining to be executed on capital account and not provided for thousand Rs.9643 thousands (net of advances of Rs.1970 thousands). Previous year Rs.33285 thousands (Net).

5. An award was received in the arbitration matter with GAIL India Ltd. in an earlier year involving disputes regarding i) revision in Capital cost of pipe line by Rs.2334 thousands and consequent higher transportation charges; and ii) additional transportation charges from January, 1997 under the supplementary agreement for additional quantity of Gas which was not recognized as income as the award was not accepted by GAIL. However as a part of revision in transportation/compression charges done by GAIL for various customers, a sum of Rs.38546 thousand received by the Company in the FY 2007-08 was shown as exceptional income. The balance relief as per award has not been accounted as GAIL has disputed the matter in court.

6. A sum of Rs.2464 thousands was due and unpaid at the end of the year to M/s. Chotila Silica Pvt Ltd, M/s. Bombay Rubber & Carbon works and M/s. Vashi Electricals Pvt Ltd. falling within the definition of entities under the Micro, Small and Medium Enterprises Development Act, 2006. However, there were no claims for interest on delayed payments.

7. Related party disclosures under accounting standard 18: (A) List of related parties:

Associate Companies

1. Borosil Glass Works Ltd.

2. Window Glass Ltd.

3. Swapan Properties Ltd.

4. Fennel Investment & Finance Pvt. Ltd.

5. Broadfield Holdings Ltd.

6. Sonargaon Properties Pvt. Ltd.

7 Gujarat Fusion Glass Ltd.

8 Vyline Glass Works Ltd.

9 Borosil International Ltd.

Key Managerial Personnel

Mr. B. L. Kheruka, Managing Director (Resigned from 17.3.2011, Remuneration upto 15.12.2010) Mr. Ashok Jain, Whole-time Director

Other parties related to Key Personnel

Mrs. Kiran Kheruka

8. a) The Company has started commercial production of low iron textured glass w.e.f. 16th March, 2010. The operations of Sheet glass plant have been suspended w.e.f. 28th July, 2010. Hence the previous year figures are strictly not comparable.

b) The recoverable value of Fixed Assets of Sheet Glass plant is higher than the book value. Hence no impairment loss has been provided for in terms of Accounting standard AS-22 of the ICAI.

c) A sum of Rs.2345 thousands paid under the voluntary retirement scheme to rationalize the workforce has been charged in the Accounts for the year. Compensation payable to remaining workers will be accounted for on settlement (works out to Rs.11660 thousands on the basis of legal provisions).

9. Previous years figures have been regrouped and rearranged wherever necessary.


Mar 31, 2010

1. No provision for Income Tax/MAT has been made for the year in view of loss.

2. Contingent liabilities not provided for:-

Rs. In thousands 2009-10 2008-09 a) Letters of Credit outstanding . 29155 308104 b) Claims against the Company not acknowledged as debt 1209 1183 c) i) Excise matters relating to valuation in appeal -before Supreme Court/ CESTAT From February1999 to June 2007 88071 88071 Equivalent amount of penalty, interest & redemption fine172270 172270

Excise amount on same basis till 31.3.^010. 51687 39209

The Company is legally advised that the disputed demands will not be sustained in view of various legal pronouncements in similar matters and subsequent judgment by CESTAT in own case for. July 2006 to June 2007. Further a sum of Rs 80062 thousands paid under protest in respect of above disputed demand have been shown as advances recoverable.

d) Income tax matters in Appeals filed by the Company in respect of Assessment Years 1998-99 to 2001 -02,2003-04 to 2005-06 on account of disallowances/additions amounting to Rs 45762 thousands (previous year Rs 178835 thousands). 15554 60786

e) Appeal filed by the Company in Sales tax matter relating to purchase of fuel and Additional Tax for F.Y 2000-01,2002-03 and 2004-05 29187 28789 Interest and penalty thereon. 25897 25897 No liability is expected in view of judicial pronouncement by High Court in similar matter of other Companies."

f) Bills discounted with banks (since realised Rs 3003 thousands) 3732 Nil

3. As per revised Accounting Standard-15 Employee Benefits, the disclosure of Employee benefits as defined in the Accounting Standard are given below:

Defined Contribution plan:

Contribution to defined contribution Plan, recognized as expense for the year are as under;

Rs. In Thousands Particulars 2009-2010 2008-2009 Employers Contribution to Provident Fund 5,632 4,965

The contribution to provident fund is made to respective Regional Provident Fund Managed by Provident Fund Commissioner and Gujarat Borosil Employees Provident Fund.

Defined Benefit Plan:

The Employees gratuity Fund Scheme is managedby Birla Sun Life Insurance Corporation. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as the gratuity.

4. The Company has accounted for estimated credit, towards expected import benefit amounting to Rs.1043 thousands under the head raw materials in respect of import entitlements. Variation, if any on actual utilization of licenses will be dealt with in the accounts of that year.

5. The estimated amount of contracts remaining to be executed on capital account and not provided for Rs. 33285 thousands (net of advances of Rs. 1476 thousands). Previous year Rs.386971 thousands (Net).

6. An award was received in the arbitration matter with GAIL India Ltd. involving disputes regarding i) revision in Capital cost of pipe line by Rs 2334 thousands and consequent higher transportation charges; and ii) additional transportation charges from January, 1997 under the supplementary agreement for additional quantity of Gas which was not recognized as income as the award was not accepted by GAIL. However as a part of revision in transportation/compression charges done by GAIL for various customers, a sum of Rs 38546 thousand has been received by the Company in the F.Y 2007-08 which was shown as exceptional income. The balance relief as per award has not been accounted as GAIL has disputed the matter in court.

7. The Company has not received information from creditors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amount unpaid at the end of the year under this act has not been given. There were no claims for interest on delayed payments.

8. The Company has started commercial production of low iron textured glass w.e.f 16th March, 2010. Hence the profit and loss account has been prepared incorporating operations of new plant from 16th March to 315| March, 2010.

9. The Companys business activity falls within a single primary business segment viz. Manufacture of Flat glass. As such, there are no separate reportable segments as per Accounting Standard 17.

10. Previous years figures have been regrouped and rearranged wherever necessary.

 
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