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Notes to Accounts of Hindustan Wires Ltd.

Mar 31, 2015

1 Preference Shares are redeemable after fifteen years beginning from 10th March 2014.

2 : SHARE CAPITAL :

3.1 The Company has entered into agreements to sell part of its land subject to regulatory approvals and has received advance which is repayable without interest, in case the requisite regulatory approvals are not granted to the Company.

4 : Other Current Liabilities :

5 Contingent Liabilities and commitments : As at As at (to the extent not provided for) 31st March, 2015 31st March, 2014

Contingent Liabilities:

(i) Claims against the Company not acknowledged as debts 44.36 60.34

(ii) Dividend Liability on 15% Cumulative Preference Shares 3.50 0.20

(iii) Claim/demands from owner of the rented property in Kolkata which are under litigation- amount not ascertainable.

Sub Total 47.86 60.54

Commitments:

Estimated amount of contracts unexecuted on capital account - -

Sub Total - -

6 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/-(previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. The entire amount is already provided in the Books, even though out of this amount Rs. 1,29,82,571/- is considered recoverable but considering the principles of financial prudence provision for the same was made in the previous year.

7 The Company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The net worth of the Company became positive and such the Company applied to BIFR for de-registration of the Company from the purview of Sick Industrial Companies (Special Provision) (SICA) Act, 1985. However, the decision of the BIFR in this matter is still awaited. The matter is being pursued by the Company.

8 (a) Interest on Unsecured loans of Rs. Nil (previous year Rs. 81,20,984/-) from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

(b) During the year the Company has given short term loan of Rs.8,65,00,000/- in its usual course of Business to its Holding Company i.e. Kashipur Holdings Limited (NBFC Company) on interest @ 11% P.A.

9 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ).

10 Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company’s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset’s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company’s Fixed Assets.

11 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

12 Employees Benefits- Disclosure pursuant to AS-15

During the year the Company has calculated and recognised the various benefits provided to employees in the Statement of Profit & Loss for the year ended 31st March, 2015 which are as under:

Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

13 Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company has reviewed its Business prospects in coming years and observed that there is no certainty of earning Business profits in coming years and as such the amount of Deferred Tax Assets is calculated at Nil .

b. Current Taxation

In view of carry forward losses and unabsorbed depreciation no provision for regular Tax as well as for MAT has been made under Section 115-JB of the Income Tax Act. The Income Tax Assessment of the Company are completed up to Assessment year 20132014.

14 Pursuant to Companies Act, 2013 ("the ACT"), being effective from 1st April, 2014, the Company has revised depreciation rates on fixed assets as per the useful life specified in part "C" of Schedule II of the Act. As a result of the change, the depreciation charge is higher by Rs 8.63 Lacs for the year ended 31st March, 2015. Further, an amount of Rs.1.31 lacs has been recognized in the opening balance of the retained earnings by adjusting in retained earning for the assets where remaining useful life as per schedule II of the said act has become nil

15 Segment Reporting :

The Company has considered "Financing" as a Segment with effect from quarter ended 31st March, 2015 and accordingly figures for the previous period has been regrouped :

16 Previous Year’s figures have been regrouped/recast wherever found necessary to confirm to this years classification in view of the applicability of the revised Schedule III to the Companies Act 2013.


Mar 31, 2014

1.1 Preference Shares are redeemable after fifteen years beginning from 10th March 2014. During the year the Company had issued 15% Redeemable Cumulative / Non-Cumulative Preference Shares amounting to Rs. 490.00 lacs and out of the proceeds of the issue has redeemed the existing Preference Shares of Rs. 490.00 lacs.

2.1 The Company has entered into an agreement to sell part of its land to an associate Company which has given this Advance, repayable without interest, in case regulatory approvals are not granted to the Company for its sale.

( in lacs)

Note No. Particulars

3 Contingent Liabilities and commitments : As at As at (to the extent not provided for) 31st March, 31st March, 2014 2013

(i) Claims against the company not acknowledged as debts 60.34 115.33

(ii) Claim of the ex-employees under litigation, amount not ascertainable.

(iii) Claim/demands from owner of the rented property in Kolkata which are under litigation- amount not ascertainable.

Sub Total 60.34 115.33

Commitments:

Estimated amount of contracts unexecuted on capital account - -

Sub Total - -

4 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. The Company till the previous year out of these amounts had considered 40 % of the amount i.e. Rs.1,29,82,571/- considered good for recovery. However in the current year the management has reviewed the matter and considering the slow progress in the recovery proceedings and also considering the principles of financial prudence provision for doubtful debts has been made to the extent of Rs. 1,29,82,571/-.

5 The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The Hon''ble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8th November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985, but the BIFR negated the original Scheme due to non and delayed compliance and discharged the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has set aside the order of BIFR and remanded the matter to BIFR and the decision in this matter is awaited. The matter is being pursued by the Company.

6 Interest on Unsecured loans of Rs. 81,20,984/-(previous year Rs. 1,17,70,984/-) from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

7 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ).

8 Impairment of Assets'' Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company''s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset''s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company''s Fixed Assets.

9 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

10 Employees Benefits- Disclosure pursuant to AS-15

The Company has calculated and recognised the various benefits provided to employees in the Statement of Profit & Loss during the year ended 31st March, 2014 as under:

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

11 Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company has reviewed its Business prospects in coming years and observed that there is no certainty of earning Business profits in coming years and as such the amount of Deferred Tax Assets is calculated at Nil .

b. Current Taxation

In view of carry forward losses and unabsorbed depreciation no provision for regular Tax as well as for MAT has been made under Section 115-JB of the Income Tax Act. The Income Tax Assessment of the Company are completed up to Assessment year 2012-2013.

12 Related Party Disclosure:

Related party as required by Accounting Standard—AS 18 "Related Parties Disclosures" issued by the Institute of chartered Accountants of India are given below:

(a) Key Management Personnel Mr.R.K.Gupta (Executive Director)

(b) Enterprises over which key Management personnel or his relatives are able to exercise significant influence. Nil

(c) Holding Company Kashipur Holdings Ltd

(d) Other Related Parties (Associates) 1. Searock Credit (P) Ltd (with whom transactions have taken place) 2. India Glycols Ltd

3. Facit Commosales (P) Ltd

4. Sukhvarsha Distributors Pvt Ltd

5. IGL Finance Ltd

13 Segment Reporting As Required By Accounting Standard-17

Presently the Business activity of the Company falls within a single primary business segment viz Industrial Gases as such the disclosure requirement of Accounting standard (AS) - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

14 Previous Year''s figures have been regrouped/recast wherever found necessary to confirm to this years classification in view of the applicability of the revised Schedule VI to the Companies Act 1956.


Mar 31, 2013

1 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. Based upon the management estimation, out of these amounts forty percent of amount i.e. Rs. 1,29,82,571/- is considered recoverable and the balance amount of Rs. 1,94,73,856 has been written off during earlier years.

2 The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The Hon''ble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8* November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985, but the BIFR negated the original Scheme due to non and delayed compliance and discharged the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has set aside the order of BIFR and remanded the matter to BIFR and the decision in this matter is awaited. The matter is being pursued by the Company.

3 Interest on Unsecured loans of Rs. 1,17,70,984/-(previous year Rs. 2,29,70,984/- from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off theirclaims of interest.

4 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ). In respect of Sodepur Unit the factory was permanently closed on 1/8/2002, however in respect of outstanding Sundry Creditors the company had requested them to furnish the relevant registration certificate, but none of them have furnished the Certificate, it is deemed that none of them is covered under the said Act.

5 Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company''s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset''s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company''s Fixed Assets.

6 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

 
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