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Notes to Accounts of India Lease Development Ltd.

Mar 31, 2015

1. Going Concern

The accumulated losses as at the close of the year amounts to Rs. 193,780,556 (after adjustment of General Reserve) against the Paid-Up Capital and other Reserves amounting to Rs. 274,304,176 which results in positive net worth. The Company is now a debt free company. In view of utilization of funds to liquidate the liabilities there has been no fresh exposure of business undertaken by the Company.

The management is of the considered view that considering the availability of assets and its realization there will be sufficient cushion available to repay all other liabilities. The accounts, as such, have been prepared on a Going Concern basis.

2. The net owned funds (NOF) although have become positive yet the Company could not comply with the Reserve Bank of India guidelines prescribed for Non Banking Financial Companies Prudential Norms (Reserve Bank Directions, 1988), with regard to (i) Maintenance of Minimum Capital Adequacy Ratio,(ii) the credit / investment exposures which have become in excess of prescribed limits.

3. The Company continues to hold the certificate issued by Reserve Bank of India in Category "B" as Non-Accepting Deposits Non Banking Finance Company

4. There is no amount due to the Micro Small and Medium Enterprises in terms of "The Micro Small and Medium Enterprises Development Act, 2006"

5. Current Taxation:- (a) Provision for Income Tax for the year has not been considered necessary in view of the accumulated carry forward losses and unabsorbed depreciation available for set off under the Income Tax Act, 1961 and Rules made thereunder.

(b) Income Tax Assessments of the Company have been made up to and including the Assessment Year 2012-13. The Company's appeals for certain years are pending in respect of certain disallowances made. In view of the favourable appellate orders for earlier years, the company expects decisions in respect of the pending matters in its favour and no provision has, therefore, been made considering the taxes already paid are more than sufficient to meet the liability, if any, upon finalization of assessment.

6. Deferred Taxation:

On a prudent and conservative basis, Deferred Tax Assets, due to timing differences, arising from Unabsorbed Depreciation, Business Loss and Provisions for Non Performing Assets have not been recognised in the absence of any certainty that sufficient future taxable income will be available in the foreseeable future against which the net Deferred Tax Assets can be realised.

7. Balance in parties accounts whether in debit or in credit are subject to confirmation.

8. Segment Reporting

The Company's business activities predominantly relate to providing finance by way of Hire Purchase and Leasing Operations. Accordingly revenue from financing activities comprises the primary basis of segmental reporting. Hence segmental reporting as defined in Accounting Standard – 17 is not applicable.

9. Related Party Disclosures

Disclosures of details pertaining to related party transactions entered into during the year in terms of Accounting Standard-18 "Related Party Disclosures" .

a) List of Related Parties (i) Under common control:

The Motor and General Finance Limited

Jayabharat Credit Limited

Bahubali Services Limited

MGF Estates Pvt. Ltd.

MGF Securities Pvt. Ltd.

Cards Services India Pvt. Ltd.

Associated Traders & Engineers Pvt. Ltd.

Local Goods Carrier Pvt. Ltd.

Ram Prakash & Co. Pvt. Ltd.

Grosvenor Estates Pvt. Ltd.

Gee Gee Holdings Pvt. Ltd.

(ii) Enterprises over which the key management personnel are able to exercise significant influence: MGF Development Limited (iii) Key Managerial Personnel:

Shri Rajiv Gupta, Chairman,

Shri Arun Mitter, Director

Shri Rohit Madan, Manager & Company Secretary

10. Assets given under Finance Lease from 1st April, 2001 in accordance with the Accounting Standard 19 (AS-19), "Leases", with contractual maturities in lease financing activities (including hire purchase agreements with an option to the hirer to acquire the assets) are set out below:

11. Lease Rental in respect of offices premises taken on operating lease are charged to the Profit and Loss account on a straight- line basis over the lease term. The rentals charged during the year aggregate to Rs. NIL (Previous Year Rs. 20,988).

12. Pursuant to enactment of the Companies Act, 2013, during the year ended March 31, 2015, the Company has applied useful lives of tangible fixed assets as prescribed in Schedule II of the Companies Act, 2013, based on technical evaluation, taking into account the nature of the asset, the estimated usage of the asset and the operating conditions surrounding the use of the asset etc. Accordingly the depreciation has been provided by depreciating the carrying value of the asset (Net of residual value of 5%) over the revised/remaining life of individual assets. Had the Company continued with the previously assessed useful lives, charge for depreciation for the year ended March 31, 2015 would have been higher by Rs. 160,004.

13. (a) The assets and liabilities are classified between current and non current considering 12 months period as operating cycle.

(b) The Company has regrouped previous year figures wherever considered necessary.


Mar 31, 2014

1. Going Concern

The accumulated losses as at the close of the year amounts to Rs. 191,144,373 (after adjustment of General Reserve) against the Paid-Up Capital and other Reserves amounting to Rs. 274,304,176 which results in positive net worth. The Company had liquidated the entire public deposits liability and made it a debt free company. In view of utilization of funds to liquidate the liabilities there has been no fresh exposure of business undertaken by the Company.

The management is of the considered view that considering the availability of assets and its realization there will be sufficient cushion available to repay all other liabilities. The accounts, as such, have been prepared on a Going Concern basis.

2. The net owned funds (NOF) although have become positive yet the Company could not comply with the Reserve Bank of India guidelines prescribed for Non Banking Financial Companies Prudential Norms (Reserve Bank Directions, 1988), with regard to (i) Maintenance of Minimum Capital Adequacy Ratio,(ii) the credit / investment exposures which have become in excess of prescribed limits.

3. The Company continues to hold the certificate issued by Reserve Bank of India in Category "B" as Non-Accepting Deposits Non Banking Finance Company.

4. Non Current Long Term Investments are to be valued at cost in terms of Accounting Standard-13 "Accounting for Investments" issued by The Institute of Chartered Accountants of India and as recommended by Reserve Bank of India''s guidelines, subject to provisions for diminution in value, other than temporary in nature. However, considering the long term nature and other related matters, investments in quoted company amounting to Rs. 3,128,160 (Previous Year Rs. 3,128,160) have been valued at cost and the temporary short fall of Rs. 832,013 (Previous Year Rs. NIL) has not been provided for.

5. There is no amount due to the Micro Small and Medium Enterprises in terms of "The Micro Small and Medium Enterprises Development Act, 2006"

6. Current Taxation:-

(a) Provision for Income Tax for the year has not been considered necessary in view of the accumulated carry forward losses and unabsorbed depreciation available for set off under the Income Tax Act, 1961 and Rules made thereunder.

(b) Income Tax Assessments of the Company have been made up to and including the Assessment Year 2010-11. The Company''s appeals for certain years are pending in respect of certain disallowances made. In view of the favourable appellate orders for earlier years, the company expects decisions in respect of the pending matters in its favour and no provision has, therefore, been made considering the taxes already paid are more than sufficient to meet the liability, if any, upon finalization of assessment.

7. Deferred Taxation:

On a prudent and conservative basis, Deferred Tax Assets, due to timing differences, arising from Unabsorbed Depreciation, Business Loss and Provisions for Non Performing Assets have not been recognised in the absence of any certainty that sufficient future taxable income will be available in the foreseeable future against which the net Deferred Tax Assets can be realised.

8. Balance in parties accounts whether in debit or in credit are subject to confirmation.

9. Segment Reporting

The Company''s business activities predominantly relate to providing finance by way of Hire Purchase and Leasing Operations. Accordingly revenue from financing activities comprises the primary basis of segmental reporting. Hence segmental reporting as defined in Accounting Standard - 17 is not applicable.

10. Related Party Disclosures

Disclosures of details pertaining to related party transactions entered into during the year in terms of Accounting Standard-18 "Related Party Disclosures" issued by The Institute of Chartered Accountants of India:

a) List of Related Parties

(As identified and certified by the management)

(i) Under common control:

The Motor and General Finance Limited Jayabharat Credit Limited Bahubali Services Limited MGF Estates Pvt. Ltd. MGF Securities Pvt. Ltd. Cards Services India Pvt. Ltd. Associated Traders & Engineers Pvt. Ltd. Local Goods Carrier Pvt. Ltd. Ram Prakash & Co. Pvt. Ltd. Grosvenor Estates Pvt. Ltd. Gee Gee Holdings Pvt. Ltd.

(ii) Enterprises overwhich the key management personnel are able to exercise significant influence: MGF Development Ltd.

(iii) Key Managerial Personnel:

Shri Rajiv Gupta, Chairman Shri Arun Mitter, Director Shri Sharad Aggarwal, Director Shri M.K. Madan, Director

Shri Rohit Madan, Manager & Company Secretary (relative of Director)

11. Lease Rental in respect of offices premises taken on operating lease are charged to the Profit and Loss account on a straight- line basis over the lease term. The rentals charged during the year aggregate to Rs. 20,988 (Previous Year Rs.78,733).

12. Contingent Liabilities & Provisions

a) Details of Provisions'' in term of Accounting Standard 29 "Contingent Liabilities & Provisions" issued by the Institute of Chartered Accountants of India are as under.

(Amount in Rs.)

Particulars Opening Additions/ Closing Balance Movement of Balance 1st April, (Net 31st March, 2013 Adjustments) 2014

Provisions for Gratuity (current and non current) 2,017,482 (335,788) 1,681,694

Provisions for Non Performing Assets as per RBI guidelines 79,363,780 (2,638,321) 76,725,459

13. a The assets and liabilities are classified between current and non current considering 12 months period as operating cycle.

b. Previous year figures have been regrouped/rearranged wherever considered necessary.


Mar 31, 2013

1. Going Concern

The accumulated losses as at the close of the year amounts to Rs. 18,93,31,142 (after adjustment of general reserve) against the Paid-Up Capital and other Reserves amounting to Rs. 274,304,176 which results in positive net worth. The Company had liquidated the entire public deposits liability and made it a debt free company. In view of utilization of funds to liquidate the liabilities there has been no fresh exposure of business undertaken by the Company.

The management is of the considered view that considering the availability of assets and its realization there will be sufficient cushion availabletorepay all other liabilities.The accounts, as such, have been preparedona Going Concern basis.

2. The net owned funds (NOF) although have become positive yet the Company could not comply with the Reserve Bank of India guidelines prescribed for Non Banking Financial Companies Prudential Norms (Reserve Bank Directions, 1988), with regard to (i) Maintenance of Minimum Capital Adequacy Ratio,(ii) the credit / investment exposures which have become in excessofprescribed limits.

3. The Company continues to hold the certificate issued by Reserve Bank of India in Category "B" as Non-Accepting Deposits Non Banking Finance Company.

4. Non Current Long Term Investments are to be valued at cost in terms of Accounting Standard-13 "Accounting for Investments" issued by the Institute of Chartered Accountants of India and as recommended by Reserve Bank of India''s guidelines, subject to provisions for diminution in value, other than temporary in nature. However, considering the long term nature and other related matters, investmentsin quoted company amountingtoRs. 3,128,160 (Previous Year Rs. 3,128,160) have been valuedatcost and the temporary short fallof Rs. Nil (PreviousYear Rs. 332,171) has not been provided for.

5. There is no amount due to the Micro Small and Medium Enterprises in terms of "The Micro Small and Medium Enterprises Development Act, 2006"

6. Current Taxation:- (a) Provision for Income Ta x for the year has not been considered necessary in view of the accumulated carried forward of losses and unabsorbed depreciation available for set off under the IncomeTa xAct, 1961 and Rules made thereunder.

(b) Income Ta x Assessments of the Company have been made up to and including the Assessment Year 2009-10. The Company''s appeals for certain years are pending in respect of certain disallowances made. In view of the favorable appellate orders for earlier years, the Company expects decisions in respect of the pending matters in its favour and no provision has, therefore, been made considering the taxes already paid are more than sufficient to meet the liability, if any, upon finalizationofassessment.

7. Deferred Taxation:

On a prudent and conservative basis, Deferred Ta xAssets, due to timing differences, arising from Unabsorbed Depreciation, Business Loss and Provisions for Non Performing Assets have not been recognised in the absence of any certainty that sufficient future taxable income will be available in the foreseeable future against which the net Deferred Ta x Assets can be realised.

8. Balance in parties accounts whether in debit or in credit are subject to confirmation.

9. Segment Reporting

The Company''s business activities predominantly relate to providing finance by way of Hire Purchase and Leasing Operations. Accordingly revenue from financing activities comprises the primary basis of segmental reporting. Hence segmental reportingasdefinedinAccounting Standard – 17 isnot applicable.

10. Related Party Disclosures

Disclosures of details pertaining to related party transactions entered into during the year in termsofAccounting Standard-18 "Related Party Disclosures" issued byThe Instituteof CharteredAccountantsofIndia:

a) ListofRelated Parties

(As identified and certified bythe management)

(i) Undercommon control:

The Motor and General Finance Limited, Jayabharat Credit Limited.

(ii) Enterprises over which the key management personnel are abletoexercise significant influence:

Bahubali Services Limited,

(iii) Key Managerial Personnel:

Shri Rajiv Gupta, Chairman,

ShriArun Mitter, Director,

Shri SharadAggarwal, Director,

Shri M.K. Madan, Director

Shri Rohit Madan, Manager &Company Secretary (relative of Director)

11. Lease Rental in respect of offices premises takenon operating lease are chargedtothe Profit and Loss account on astraight- line basis over the lease term.The rentals charged during the year aggregateto Rs. 78,733 (PreviousYear Rs.126,958).

12. Contingent Liabilities & Provisions

a) Details of Provisions'' in term of Accounting Standard 29 "Contingent Liabilities & Provisions" issued by The Institute of Chartered Accountants of India are as under.

(Amount in Rs.)

Particulars Opening Balance Additions/ Closing Balance

01.04.12 Movement (Net of 31.03.13

Adjustments)

Provisions for Gratuity (current and non current) (2,103,914) (86,432) 2,017,482

Provisions for Non Performing Assets as per RBI guidelines 79,522,541 (158,763) 79,363,780

13. The assets and liabilities are classified between current and non current considering 12 months period as operating cycle. The Company has regrouped previous year figures wherever considered necessary.

 
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