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Notes to Accounts of Integrated Technologies Ltd.

Mar 31, 2014

1. Contingent Liability 31.03.2014 31.03.2014 Rs./Million Rs./Million

In respect of demand from various government authorities regarding following dues:

(a) Disputed custom & central excise duty 66.533 66.533 (refer other note no. 3)

(b) Income Tax interest demand for AY 1995-96 to1997-98 1.932 1.932 (refer other note no.4a)

(c) Income Tax Demand AY 1998-99 1.763 1.763 (refer other note no.4b)

(d) Amount Payable to HARTRON (Haryana State Electronic 8.423 8.423 Development Corp.) for buyback of equity shares in terms of Arbitral award. Simple Interest @ 9% p.a. to be paid in Addition w.e.f. 01.11.2000. (Refer other note no. 5)

(e) Bank Guarantee 0.450 0.450

2. Changes in Capital during the year 2008-09

As per rehabilitation scheme (SS-08) for revival of the company sanctioned by Board for Industrial Financial Reconstruction (BIFR), the company restructured its share capital in the year 2008-2009 as under:

a) Reduction in paid up equity share capital by 90% as result of which paid up value of one equity share was reduced from Rs 10 to Rs 1.

Further to above, 10 equity shares of Re. 1 each were consolidated to one equity share of Rs. 10 each, resulting in reduction of 10,318,100 equity shares to 1,031,810 equity shares.

b) Preferential issue to strategic investor and promoters of 3,111,600 equity shares and 638,100 equity shares respectively.

3. The company has applied for permission to exit from EOU scheme vide its letter dated 01 July 2010 in response of which it was directed by Development Commissioner, Noida Special Economic Zone vide letter no.1-7/92/100%EOU/5261 dated 15th July 2010 to obtain no dues certificate from Central Excise and Custom Department in respect of benefits taken for 100% EOU since inception of the company.

In response to above, Central Excise department has served a show cause notice no VIII (B) Cus/R/VIIIA/GGN/11/02/Pt. ii/15777 dated 11th February 2011 directing the company to deposit Rs. 66.533 million towards Custom & Central Excise Duty foregone on raw materials and capital goods. The said payment is disputed by the Company and has been shown a contingent liability.

4. (a) Income Tax dues for assessment year 1995-96 to 1997-98 are of Rs 3,932,005 as per the orders of ITAT/ Honorable Delhi High Court against which liability for Rs 2,000,000 has been accounted for as per BIFR rehabilitation Sanction Scheme dated 27th March, 2008 and for the remaining sum of Rs 1,932,005, which is on account of interest, waiver has been sought from CBDT. (b) Income tax demand of Rs. 1,762,756 for assessment year 1998-99 is under appeal before ITAT and has been shown a contingent liability as the company is hopeful for a favorable decision.

5. Haryana State Electronic Development Corporation (HARTRON) has invested Rs 4.400 million as per Assisted Sector Agreement dated 5th June,1991 by way of equity of Integrated Technologies Limited with the condition that the company will buy back this equity after expiry of 5 years from the date of commercial production or at the expiry of 7 years; whichever is earlier.

The Arbitrator had passed the Arbitral Award dated 25th April, 2003 in favour of HARTRON and determined payable amount Rs 8,423,135 with interest @12% p.a. w.e.f 1.11.2000. Award was challenge by the company in District Court which was dismissed. In the company''s further appeal (FAO 1197 of 2009) to Honorable High Court, Chandigarh, the payment to HARTRON was upheld but at a reduced interest rate of 9% p.a. w.e.f 1.11.2000.

The company''s special leave petition to Honorable Supreme Court against the above judgment dated 18.05.2011 of Honorable High Court, Chandigarh has been dismissed on 25.11.2011.

The company is hopeful of a favorable settlement of the issue of which the amount presently is not ascertainable and accordingly, it has been shown a contingent liability.

6. In the opinion of the management, there is no taxable profit for current year. Accordingly, no provision for income tax has been made.

7. No amount is payable to small scale industrial undertakings under MSMED Act, as per information available with the company.

8. In the opinion of the Management, The Payment of Gratuity Act, 1972 is not applicable to the company, since no employee has completed 5 years of uninterrupted service and therefore no provision for gratuity is made.

9. Certain debit/credit balances are subject to confirmation/reconciliation and consequential adjustment, if any required.

10. In the opinion of the management, current assets shall have a value on realization in the ordinary course of business at least equal to the amount at which they are stated in the balance sheet.

11. Related Party Disclosure

In compliance of Accounting Standard 18 on "Related Party Disclosure" issued by the ICAI, the details pertaining to related party disclosure are as follows:

Following are the Related Parties as per AS-18

(A) Particulars of Subsidiaries/Holding/Associate Companies Bubble Softsolutions Private Limited

(B) Key Management Personnel

Name Designation

Mr. Rajeev Bali Managing Director

(C) Relative of Key Management Personal

Smt. Krishna Bali

(D) Enterprise over which any person described in (B) or (C) is able to exercise Significant influence.

Bubble Softsolutions Private Limited Director Mrs. Krishna Bali

ITL Systems and Networks Mr. Rajeev Bali (Proprietor)

12. Segment Reporting

The company is engaged in the business of manufacturing of Printed Circuit Boards (PCB''s). Accordingly, these financial statements are reflective of the information required by the Accounting Standard -17 for professional grade printed circuit boards segment.

13. Figures for the previous year have been regrouped / rearranged, wherever considered necessary.


Mar 31, 2013

1. Contingent Liability

31.03.2013 31.03.2012 Rs/Million Rs /Million

In respect of demand from various government authorities regarding following dues:

(a) Disputed custom & central excise duty 66.533 66.533 (refer other note no. 3)

(b) Income Tax interest demand for AY 1995-96 to1997-98 1.932 1.932 (refer other note no.4a)

(c) Income Tax Demand AY 1998-99 (refer other note no.4b) 1.763 1.763

(d) Amount payable to HARTRON (Haryana

State Electronic Development Corp.) for 8.423 8.423 buyback of equity shares in terms of Arbitral award (refer other note no.5)

(e) Bank Guarantee 0.450 0.450

2. Changes in Capital during the year 2008-09

As per rehabilitation scheme (SS-08) for revival of the company sanctioned by Board For Industrial Financial Reconstruction (BIFR), the company restructured its share capital in the year 2008-2009 asunder:

a) Reduction in paid up equity share capital by 90% as result of which paid up value of one equity share was reduced from Rs 10 to Re. 1.

Further to above , 10 equity shares of Re 1 each were consolidated to one equity share of Rs 10 each, resulting in reduction of 1,03,18,100 equity shares to 10,31,810 equity shares.

b) Preferential issue to strategic investor and promoters of 31,11,600 equity shares and 6,38,100 equity shares respectively.

3. The company has applied for permission to exit from EOU scheme vide its letter dated 01 July 2010 in response of which it was directed by Development Commissioner, Noida Special Economic Zone vide letter no. 1-7/92/100%EOU/5261 dated 15th July 2010 to obtain no dues certificate from Central Excise and Custom Department in respect of benefits taken for 100% EOU since inception of the company.

In response to above, Central Excise department has served a show cause notice no VIII (B) Cus/R/VIIIA/GGN/11/02/Pt. ii/15777 dated 11th February 2011 directing the company to deposit Rs. 66.533 million towards custom & central excise duty foregone on raw materials and capital goods. The said payment is disputed by the Company and has been shown a contingent liability.

4. (a) Income Tax dues for assessment year 1995-96 to 1997-98 are of Rs 3,932,005 as per the orders of ITAT/Honorable Delhi High Court: against which liability for Rs 2,000,000 has been accounted for as per BIFR rehabilitation sanction scheme dated 27th March 2008 and for the remaining sum of Rs 1,932,005, which is on account of interest, waiver has been sought from CBDT.

b) Income tax demand of Rs. 1,762,756 for assessment year 1998-99 is under appeal before ITAT and has been shown a contingent liability as the company is hopeful for a favourable decision.

5. Haryana State Electronic Development Corporation (HARTRON) has invested Rs 4.400 million as per Assisted Sector Agreement dated 5th June 1991 by way of equity of Integrated Technologies Limited with the condition that the company will buy back this equity after expiry of 5 years from the date of commercial production or at the expiry of 7 years; whichever is earlier.

The Arbitrator had passed the Arbitral Award dated 25th April 2003 in favour of HARTRON and determined payable amount Rs 8,423,135 with interest @12% p.a. w.e.f 1.11.2000. Award was challenge by the company in district courts which was dismissed. In the company''s further appeal (FAO 1197 of 2009) to Honorable High Court, Chandigarh, the payment to HARTRON was upheld but at a reduced interest rate of 9% p.a. w.e.f 1.11.2000.

The company''s special leave petition to Honorable Supreme Court against the above judgment dated 18.05.2011 of Honorable High Court; Chandigarh has been dismissed on 25.11.2011. The company is hopeful of a favorable settlement of the issue of which the amount presently is not ascertainable and accordingly, it has been shown a contingent liability.

6. In the opinion of the management, there is no taxable profit for current year as the same would be set off against unabsorbed depreciation and losses of earlier years. Accordingly, no provision for income :ax has been made.

7. No amount is payable to small scale industrial undertakings under MSMED Act, as per information available with the company.

8. In the opinion of the Management, the Gratuity Act, 1972 is not applicable to the company, since no employee has completed 5 years of uninterrupted service and therefore no provision for gratuity is made.

9. Certain debit/credit balances are subject to confirmation/reconciliation and consequential adjustment, if any required.

10. In the opinion of the management, current assets shall have a value on realization in the ordinary course of business at least equal to the amount at which they are stated in the balance sheet.

11. Related Party Disclosure

In compliance of Accounting Standard -18bn "Related Party Disclosure" issued by the ICAI, the details pertaining to related party disclosure are as follows:

Following are the Related Parties as per AS-18

(A) Particulars of Associate Companies / Strategic Investor Bubble Softsolutions Private Limited

(B) Key Management Personnel

Name Designation

Mr. Rajeev Bali Managing Director

(C) Relative of Key Management Personal

Smt Krishna Bali

(D) Enterprise over which any person described In (B) or (C) Is able to exercise significant influence.

Bubble Softsolutions Private Limited Director Mrs. Krishna Bali

ITL Systems and Networks Mr. Rajeev Bali (Proprietor)

Detail of Transactions

Related parties defined under Clause 3 of AS-18 "Related Party Disclosure" has been identified on the basis of representation made by managerial personnel and information available with the company.

12. Segment Reporting

The company is engaged in the business of manufacturing of Printed Circuit Boards (PCB''s). Accordingly, these financial statements are reflective of the information required by the Accounting Standard -17 for professional grade printed circuit boards segment.

13. Figures for the previous year have been regrouped / rearranged, wherever considered necessary.


Mar 31, 2012

1. Changes in Capital during the year 2008-09

As per rehabilitation scheme (SS-08) for revival of the company sanctioned by Board For Industrial Financial Reconstruction (BIFR), the company restructured its share capital in the year 2008-2009 as under:

a) Reduction in paid up equity share capital by 90% as result of which paid up value of one equity share was reduced from Rs 10 to Re. 1.

Further to above , 10 equity shares of Re 1 each were consolidated to one equity share of Rs 10 each, resulting in reduction of 1,03,18,100 equity shares to 10,31,810 equity shares.

b) Preferential issue to strategic investor and promoters of 31,11,600 equity shares and 6,38,100 equity shares respectively.

2. The accumulated losses are more than 50 % of the Net Worth of the company. Further, the company has incurred cash loss during the year ended 31st March 2012 of Rs 2.83 lacs. The company has incurred cash loss of Rs 85.02 lacs in the immediately preceding financial year. in the view of the management reference to the same is presently not required as per provisions of Sick Industrial Companies Act(SICA).

3. The company has applied for permission to exit from EOU scheme vide its letter dated 01 July 2010 in response of which it was directed by Development Commissioner, Noida Special Economic Zone vide letter no.1-7/92/100%EOU/5261 dated 15th July 2010 to obtain no dues certificate from Central Excise and Custom Department in respect of benefits taken for 100% EOU since inception of the company.

In response to above, Central Excise department has served a show cause notice no VIII (B) Cus/R/VIIIA/GGN/11/02/Pt. ii/15777 dated 11th February 2011 directing the company to deposit Rs 665.33 lacs towards custom & central excise duty foregone on raw materials and capital goods. The said payment is disputed by the company and has been shown a contingent liability.

4. (a) Income Tax dues for assessment year 1995-96 to 1997-98 are of Rs 39,32,005 as per the orders of ITAT/Honourable Delhi High Court: against which liability for Rs 20,00,000 has been accounted for as per BIFR rehabilitation sanction scheme dated 27th March 2008 and for the remaining sum of Rs 19,32,005, which is on account of interest, waiver has been sought from CBDT.

(b) Income tax demand of Rs 17,62,756 for assessment year 1998-99 is under appeal before ITAT and has been shown a contingent liability as the company is hopeful for a favourable decision.

5. Haryana State Electronic Development Corporation (HARTRON) has invested Rs 44 lacs as per Assisted Sector Agreement dated 5th June 1991 by way of equity of Integrated Technologies Limited with the condition that the company will buy back this equity after expiry of 5 years from the date of commercial production or at the expiry of 7 years from the date of incorporation of the Company, whichever is earlier.

The Arbitrator had passed the Arbitral Award dated 25th April 2003 in favour of HARTRON and determined payable amount Rs 84,23,135 with interest @12% p.a. w.e.f 1.11.2000. Award was challenge by the company in district courts which was dismissed. In the company''s further appeal (FAO 1197 of 2009) to Honorable High Court, Chandigarh, the payment to HARTRON was upheld but at a reduced interest rate of 9% p.a. w.e.f 1.11.2000.

The company''s special leave petition to Honorable Supreme Court against the above judgment dated 18.05.2011 of Honorable High Court, Chandigarh has been dismissed on 25.11.2011. The company is hopeful of a favourable settlement of the issue of which the amount presently is not ascertainable and accordingly, it has been shown a contingent liability.

6. The company has entered during the year an agreement to sell its land and building and received an advance of Rs 4,50,00,000 from the prospective buyer. Pending execution of the conveyance deed and handing over the possession, the said advance is shown in note no. 5 of "other current liabilities".

7. No amount is payable to small scale industrial undertakings under MSMED Act, as per information available with the company.

8. In the opinion of management the Gratuity Act, 1972 is not applicable to the company, since noemployee has completed 5 years of uninterrupted service and therefore no provision for gratuity is made.

9. Addition to land of Rs 115,65,851 ( previous year Rs Nil) is on account of 50% internal & external development charges paid by the company to HSIDC . Remaining 50% are payable in four yearly installments with 15% p.a. simple interest and have been agreed to be borne by the buyer of land.

10. Certain debit/credit balances are subject to confirmation/reconciliation and consequential adjustment, if any required.

11. In the opinion of the management, current assets shall have a value on realization in the ordinary course of business at least equal to the amount at which they are stated in the balance sheet.

12. Related Party Disclosure

In compliance of Accounting Standard –18 on "Related Party Disclosure" issued by the ICAI, the details pertaining to related party disclosure are as follows:

Following are the Related Parties as per AS-18

(A) Particulars of Associate Companies / Strategic Investor

Bubble Softsolutions Private Limited

(B) Key Management Personnel

Name Designation

Mr. Rajeev Bali Managing Director

(C) Relative of Key Management Personal

Smt Krishna Bali

(D) Enterprise over which any person described in (B) or (C) is able to exercise significant influence.

Bubble Softsolutions Private Limited Director Mrs. Krishna Bali

ITL Systems and Networks Mr. Rajeev Bali (Proprietor)

13. Segment Reporting

The company is engaged in the business of manufacturing of Printed Circuit Boards (PCB''s). Accordingly, these financial statements are reflective of the information required by the Accounting Standard -17 for professional grade printed circuit boards segment.


Mar 31, 2011

1.Segment Reporting:

The company is engaged in the business of manufacturing of Printed Circuit Boards (PCB's). Accordingly, these financial statements are reflective of the information required by the Accounting Standard -17 for professional grade printed circuit boards segment.

2. Related Party Disclosure

In compliance of Accounting Standard -18 on "Related Party Disclosure" issued by the ICAI, the details pertaining to related party disclosure are as follows: Related parties defined under Clause 3 of AS-18 "Related Party Disclosure" have been identified on the basis of representation made by managerial personnel and information available with the company.

3. Deferred Tax Assets

Provision for Deferred Tax Assets as per Accounting Standard 22, issued by the Institute of Chartered Accountants of India has been recognized as Follows:

4. The Company could not work out the figures for creditors under MSMED Act, due to non availability of information from the creditors.

5. Contingent Liability

31.03.11 31.03.10

Rs/Lacs Rs/Lacs

In respect of demand from various government authorities regarding following dues:

(a) Show cause notice issued by

Excise department

For NFE (Net Foreign Earnings) 620.00 0.00

(b) Income Tax Demand AY 1998-99 17.63 17.63

(c) Amount payable to HARTRON(Haryana

State Electronic Development Corp.) for 84.23 0.00 buyback of equity shares in terms of Arbitral award.

6. The Company has been granted an extension of utilization period of advance DTA sale upto 22nd September 2010 vide letter no F-NO.1-7/92-100% EOU dated 22nd December 2009 by Noida Special Economic Zone Govt. of India, Ministry of Commerce and Industry Department of Commerce. The company has applied for permission to exit from EOU scheme vide letter dated 1st July 2010. The company has been directed by development commissioner Noida Special Economic Zone Vide letter no1-7/92/100%EOU/5261 dated 15th July 2010 to obtain no dues from Central Excise and Custom Department for all applicable benefits taken for 100%EOU since the inception of the company.

In response to above central excise department has served a show cause notice vide letter no VIII(B)CUST/R/VIIIA/GGN/1102/PT11 dated 11th February 2011directing the Company to deposit Rs 620 lacs. The Company has gone in appeal; the said amount is shown as contingent liability.

7. Haryana State Electronic Development Corporation (HARTRON) has invested Rs 44 lacs as per sector assisted agreement dated 5th June 1991 by way of equity of Integrated Technologies Limited with the condition that the Company will buyback those equity after the expiry of a period of 5 years from the date of commercial production by the company or at the expiry of a period of 7 years whichever is earlier.

The Arbitrator had passed the Arbitral Award dated 25th April 2003 in favour HARTRON. The Award was challenge by the Company which was dismissed. The Company made further appeals (FAO 1197 of 2009) in Honorable High Court Chandigarh for setting aside the impunged order dated 25th April 2003 passed by the arbitrator.

HARTRON vide letter no SO (Admin)II. 2011. 7713. Dated 5th August 2011 directed the company to pay Rs 84,23,135/- along with interest @ 9% p.a. from 1st November 2000 till the date of making the payment to HARTRON along with payment of Arbitrator cost of Rs 15,000/-. The Company has not challenged the award till date. The said amount has been shown Contingent liability in the accounts.

8. The income tax assessment for the year 1998-99 is pending before the High Court for regular demand of Rs 17.63 Laks. A penalty of Rs 17.96 has been imposed on the Company for which an appeal has been preferred to the Commissioner of Income Tax (Appeals), where the Company's appeal was upheld. The department has accordingly preferred an appeal to the High Court for the assessment year 2004-2005. In the view of the management no provision is required on these cases.

The demand for the assessment year 1998-1999 for Rs 17.63 laks has been shown as contingent liability.

9. Changes in Capital during the year 2008-09:

As per rehabilitation scheme (SS-08) for revival of the company sanctioned by Board For Industrial Financial Reconstruction (BIFR), the company restructured its share capital in the year 2008-2009 as under:

a) Reduction in paid up equity share capital by 90% as result of which paid up value of one equity share was reduced from Rs 10 to Re. 1.

Further to above 10 equity share of Re 1 each was consolidated to one equity share of Rs 10 each, resulting in 1,03,18,100 equity shares were reduced to 10,31,810 equity shares.

b) Preferential issue to strategic investor and promoters of 31,11,600 equity shares and 6,38,100 shares respectively.

10. In the opinion of management the Gratuity Act, 1972 is not applicable to the Company, since no employee of the Company has completed 5 years of uninterrupted period of service.

11. The accumulated losses are more than 50 % of the Net Worth of the company. Further, the Company has incurred cash loss during the year ended 31st March 2011 of Rs 85.05 lacs. The Company has incurred cash loss of Rs 82.91 lacs in the immediately preceding financial year. in the view of the management reference to the same is presently not required as per provisions of Sick Industrial Companies Act ( SICA).

12. Figures for the previous year have been regrouped / rearranged, wherever found necessary. Figures in bracket re-present the previous year figures.

13. Schedule 1 to 13 forms an integral part of the balance sheet and profit and loss account.

 
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