Home  »  Company  »  Kilburn Chemical  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Kilburn Chemicals Ltd.

Mar 31, 2015

1. The Company has issued Equity Shares having a face value of Rs. 10/- each. Each holder of the Equity Shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to the approval of the Share holders in the Annual General Meeting.

2. In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive any of the remaining assets of the Company after distribution of all preferential amounts. The distribution will be in the proportion to the number of Equity Shares held by the shareholders.

3. Contingent Liabilities not provided for in the Financial Statements in respect of the following:

Income Tax Demand of Rs. 6,25,55,590/- for the Assessment Year 2012-13 disputed in appeal.

4. Retirement Benefits

Liability in respect of Gratuity upto 31st March, 2015 comes to Rs.25,89,230/- against which the Company has provided Rs.4,64,346/-. Net liability of Rs.21,24,885/- including Rs.1,83,461/- for the current year remained unprovided in the Financial Statement.

5. Export Benefits

Consideration/Benefits for transfer of DEPB licences and benefits (including for entitlements in hand as on the close of the year and/or to be received) in previous year were accounted for on accrual basis and were being valued at estimated and/or at net estimated realizable value. Adjustments for short/excess realizations, out of Rs. 4,63,033/- outstanding as on 31.3.2015 and brought forward from earlier years are intended to be made on actual dates of realization. No recoveries against such receivable amount was made during the year. As the management considers such amount as fully receivable, no provision has been made against such receivable amount. In case there will be any short recovery the results of the Company will get affected to that extent.

6. The Company has not received any information from suppliers regarding their status under Micro, Small and Medium Enterprise Development Act, 2006 and hence disclosure, if any, required to be made under the said Act could not be compiled and disclosed.

7. Trade Receivables of Rs. 11,09,72,664/- in respect of commodity transactions are still pending realization. This year Rs. 4,36,246/- has been realized against such receivables. The broker through whom such transactions were made has informed that they are continuously pursuing the matter towards recovery of such outstanding amount with NSEL and that the matter is under Judicial Investigation by Forward Market Commission and Economic offence wing etc. Considering the present state of affairs, action taken by the Government and other authorities, the management is confident of recovering such dues over a period of time. Accordingly, against such exposure of Rs. 11,09,72,664/- no provision has been considered at this stage and such Trade Receivables are shown as good and fully recoverable.

8. The Company was liable to pay Non - utilization penalty of Rs.2,15,13,989/- to Gujarat Industrial Development Corporation as per their Letter No. GDC/DM/CG/ANK/227 dated 03/02/2015 for seeking extension in time limit for utilization of Leasehold Land allotted, out of which the Company has paid Rs.71,71,330/- till 31st March, 2015 and the balance amount of Rs.1,43,42,659/- has not been provided for in the financial statements.

9. Certain balances included in Trade Receivables, Trade Payables, other Current Liabilities and Claim Receivable are old balances and are subject to confirmation.

26) Segment Reporting

The Company's operations during the year comprises of only one segment i.e. Windmill Power Sales as such Accounting Standard 17 on "Segment Reporting" is not relevant. The Geographical Segment is also not relevant as the Company did not have any overseas operations during the year.

27) Related Party Transactions

Related Party disclosures as required under Accounting Statndard-18 on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India, as certified by the Management, are given below:

1. Relationship

A. Key Management Personnel and their relatives

1) Mr. S. K. Jalan (Managing Director)

2) Late B.P. Jalan (Father of Mr. S. K. Jalan, Managing Director)

3) Mr. S. G. Somani (CFO)

4) Mr. Mukesh Sharma (Company Secretary)

HUF

M/s. Bajarang Prasad & Son (HUF) [Mr.S.K. Jalan is Karta]

B. Enterprises over which Key Management Personnel and relatives of such Key Managerial Personnel Exercise Significant Influence

1) Kilburn Office Automation Limited

2) Kilburn Software Technologies Limited

3) Shree Durga Agencies Limited

4) Supriya Finance Limited (formerly Buckingham Financial Services Limited)

5) Pushpdant Vyapaar Private Limited

6) Arham Vyapaar Private Limited.

7) Maryada Advisory Services Private Limited

8) Saket Fiscal Services Private Limited

29) Due to change in method of providing depreciation as per Schedule-II to the Companies Act, 2013 depreciation provided during the year is lower by Rs. 33,05,818/- and thereby disclosing profit higher by similar amount.

30) Exceptional items in the Statement of Profit and Loss represents excess Remuneration of Rs. 6,06,130/- paid to Managing Director in earlier year recovered during the year.

31) The amount of Rs.6,31,462/- lying in Unpaid Dividend Account for the year 2006-2007 has been transferred to the Investor Education and Protection Fund in accordance with the relevant provisions of the Companies Act, 1956 and rules made thereunder, on 22/12/2014 the due date of which was 25/10/2014.

32) The previous year's figures have been regrouped, rearranged wherever found necessary.


Mar 31, 2014

A) Includes 7,65,000 Equity Shares of Rs. 10/- each alloted on 29th March, 2014 at a Premium of Rs. 6/- aggregating to Rs. 1,22,40,000/- to a Promoter group Company on preferential basis, ranking pari passu with the existing Equity Shares. Such Equity Shares issued during the year are pending for listing on BSE, where the Company''s shares are listed.

b) Terms/rights attached to Equity Shares

The Company has only one class of Equity Shares having a par value of Rs. 10/- per Share. Each holder of equity share is entitled to one vote per share. The Company declares and pay dividend in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the Share holders in the Annual General Meeting. (also refer note (a) above).

c) Details of shareholders holding more than 5% shares in the Company''s Equity shares of Rs. 10/- each fully paid up. Such details are subject to confirmations of respective parties.

a) The Management has certified that the company has not received any intimation from suppliers regarding their status under Micro, Small and Medium Enterprise Development Act, 2006 and hence disclosure, if any, required to be made under said Act could not be complied and disclosed.

b) Also refer Note 1(vii)(g) in Note 20.

a) The actual amount to be transferred to the Investor Education and Protection Fund in this respect shall be determined on the due dates.(also refer Note 6(v) in Note 20).

b) Also refer Note 1(viii)(g) in Note 20.

c) Represents redemption amount, issued cheque returned, lying unpaid due since accounting year ended 31.03.2012, considered by the management as "Other Current Liabilities"

a) Includes Rs.19,829/- pending reconciliation and adjustments.

b) Due since accounting year ended 31.3.2012, considered by the management as "Short Term provisions".

(a) Includes Rs.377/- (P.Y. Rs.1,131/-) Lease Rent and interest Rs. 3,50,771/- (P.Y. Rs. 4,79,936/-), infrastructure Fund Rs. 25,65,823/- (P.Y. Rs.1,16,16,866/-) and Service and Other Charges.

(b) Includes Salaries and wages etc, coveyance expenses, telephone and other expenses amounts whereof not separately ascertained by the management and hence not stated.

a) Includes Rs.11,14,08,910/-receivables in respect of "Commodity Account Receivable" (grouped in previous year under "Other Current Assets" in Note 14) due for more than one year, not provided for (refer note 3 in Note 20)

b) Includes Rs. 41,44,845/- (P.Y. Same amount) due from a related party.

c) Refer Note 2 in Note 20.

a) Includes Rs. 5,701/- on no lien account.

b) Fixed Deposit receipts lodged with various Government agencies as security for which confirmation certificates were not available for Auditors inspection.

c) In view of Note (b) amount with more than 12 months maturity, if any could not be ascertained and therefore not disclosed separately, as required under Schedule VI to the Companies Act, 1956 and it has not been possible to ascertain the period of Fixed Deposits and the dates of maturity.

(d) Excluding cheques issued but not presented Rs. 8,66,860/-.

a) Details are as under : M/s Kilburn Office Automation Ltd.

b) Balance amount of Loan outstanding since accounting year 31.03.2012 or earlier without any transactions, not provided for, considered by the management as "Short Term". (also refer Note 2 and Note 11 in Note 20)

c) Includes Rs. 33,187/- (P.Y. 11,087/-) due by an officer of the Company.

a) Outstanding since accounting year ended 31.03.2012 or earlier, without any transactions, not provided for, considered by the management as "Current Assets".(also refer Note 2 in Note 20).

(a) This amount has not been regrouped with the amount of tax expense relating to earlier year in Statement of Profit and Loss. Due to this the Profit before tax and the tax expense for prior year has been shown lesser by Rs. 1,80,696/-.However, there has been no change in Profit after tax.

a) Relating to earlier year.

b) Includes Foreign Exchange/ Currency / travellers cheques purchased Rs.6,86,964/- (P.Y. Rs.5,43,295/-)

c) Includes Salaries etc. Rs.1,50,895/- (P.Y. Rs. 2,02,132/-) and vehicle maintenance expenses Rs.2,02,132/- (P.Y. Rs.1,670/-).

2. The management has considered the following amounts outstanding as on 31.03.2014 as good and fully recoverable. In absence of adequate evidences in support of the same, being good, and recoverable the auditors are unable to comment as to the recoverability of such amounts and the same are not provided for in the Accounts.

All the above amounts are brought forward from earlier years.

Due to non provisioning of amounts out of above amounts, the profits for the year, the Reserves and Surplus and Assets and Liabilities, are affected to such extent, the amounts whereof have not been ascertained by the management and therefore not stated. * Accumulated losses of such Company, as per their Audited accounts for the year ended 31.03.2013 are more than fifty percent of the Net Worth of the Company.

3. (a) The company is engaged in activity of purchase/sale of various commodities. A total quantity of 90,294 Bags

(P.Y. 5,60,585 Bags) of various commodities have been purchased for Rs. 26,41,40,278/- (P.Y. Rs. 63,95,40,523/-) and 1,33,009 Bags (P.Y. 5,38,070 Bags) have been sold for Rs. 39,49,80,248/- (P.Y. Rs. 58,76,39,922/-) during the year. Gain realized, at the end of settlement period, on such transactions has been considered as profit for the year. Payments (outstanding) made by the company have this year been considered under Trade Receivables in Note 11 (P.Y. under Current Assets in Note 14)

(b) Bills for purchases of commodities for Rs. 10,05,24,073/- and sales of Commodities of Rs. 8,43,26,022/- and warehouse receipts for stock of such commodities as on 31.3.2014 shown under note 16, under the head "Profit on commodity Transactions" could not be made available for Auditors inspection and verification. The Company has been informed by M/s Aum Commodity Services Pvt. Ltd. vide letter dt. 04.03.2014, the brokers through whom such transactions were done that the invoices against such trade transactions are held at NSEL''s end. Regarding physical copies of warehouse receipts the brokers have informed that such receipts were used to be kept by NSEL in their custody for pay-in of commodities towards the sale proceeds. The warehouse receipts serial numbers were provided by NSEL in electronic form through exchange''s client wise Delivery Allocation report which are in Company''s possession. Such aforesaid invoices and warehouse receipts will be available after payouts are released by the said Exchange.

(c) Trade Receivables of Rs. 11,14,08,910/- in respect of commodity transactions are still pending realization. This year Rs. 2,19,396/- has been realized against such receivables. The broker through whom such transactions were made has informed that they are continuously pursuing the matter towards recovery of such outstanding amount with NSEL and that the matter is under Judicial Investigation by Forward Market Commission and Economic offence wing etc. Considering the present state of affairs, action taken by the Government and other authorities, the management is confident of recovering such dues over a period of time. Accordingly, against such exposure of Rs. 11,14,08,910/-, no provision has been considered at this stage and such Trade Receivables are shown as good and fully recoverable (also refer note 2 above).

4. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of Advances of Rs. NIL (P.Y. Rs. NIL) is Rs. 7,61,12,142/- (P.Y. Rs 12,62,77,732/-).

5. In the opinion of the Board of Directors, all the assets other than fixed assets and non current investments 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. The provisions for liabilities are adequate and not in excess of the amount reasonably necessary.(also refer Note 2 above)

6. (i) Copies of letters sent by the Company to various parties for confirmation of their balances as at the end of the

year and or their accounts for transactions with the company during the year ended 31.03.2014 were not available for Auditors inspection and therefore accounts in respect of Liabilities, Trade Receivables, Loans, Advances and Other Assets are subject to confirmations of respective parties.

(iv) The management has certified that there were no period end foreign currency exposures that have not been hedged by derivative instrument or otherwise.

(v) The amount of Rs.6,39,028/- (P.Y. Rs. 6,67,332/-) lying in Unpaid Dividend Account 2005-2006 (P.Y. 2004- 2005) of the Company has been transferred to the Investor Education and Protection Fund as per provisions of Section 205C of the Companies Act, 1956 on 17.01.2014 (P.Y. 04.03.2013) against the due date of 4.10.2013 (P.Y. 24.09.2012).

(vi) Exceptional items, as per statement of Profit and Loss represents listing fees paid for proposed listing of 7,65,000 Equity shares (refer note (a) in Note 1) the application for which has been made with BSE LTD. on 16.04.2014. Such amount has been considered as Expenses and Exceptional Item only as per certificate of the management.

7) Earnings per share (EPS)

The numerators and denominators used to calculate basic and diluted earnings per share.

8. Segment Reporting

a) The Company is advised that the activities of the Company in respect of various commodities, as referred to in Note 3 above, do not constitute trading activity in the context of Accounting Standard 17 on "Segment Reporting" and therefore such transactions have not been constituted as "Segment". The Company''s operations during the year comprises of only one segment i.e. Windmill Power Sales. The Auditors have relied on the said opinion in this regard.

b) Geographical Segment

The analysis of Geographical Segment is based on the geographical location of the customers. The geographical segments considered for disclosure are as follows :

i) Sales within India include Sales to customers located within India.

ii) Sales outside India include Sales to customers located outside India.

c) Information pertaining to Geographical Segment

(i) Gross Revenue as per Geographical locations

ii) Fixed Assets as per Geographical locations

The company has common fixed assets for producing goods for domestic as well as overseas market. Hence, segment wise information for fixed assets / additions to fixed assets cannot be furnished.

9. Related Party Disclosures

(Particulars identified by the Company on the basis of information available and have been relied upon by the Auditors)

i) List of related parties :

A. Key Management Personnel and their relatives

1) Mr. S. K. Jalan (Managing Director)

2) Mr. B. P. Jalan (Father of Mr. S. K. Jalan)

3) M/s. Bajarang Prasad & Son (HUF) [Mr. B. P. Jalan (Father of Mr. S. K. Jalan) is Karta]

B. Enterprises over which Key Management Personnel and relatives of such Key Management Personnel exercise significant influence

1) Kilburn Office Automation Limited

2) Kilburn Software Technologies India Limited

3) Shree Durga Agencies Ltd

4) Supriya Finance Limited (formerly Buckingham Financial Services Ltd)

5) Pushpdant Vyapaar Private Ltd

6) Arham Vyapaar Private Ltd.

7) Maryada Advisory Services Private Ltd

8) Kilburn Pigments Ltd (Name struck off)

11) (i) The Company had given loans to a body Corporate (related party) from time to time till 31.03.2012 and the

outstanding balance of such loan as on 31.03.2013 was Rs. 2,75,01,331/- (Maximum amount Rs. 2,75,01,331/-). Such loan was also outstanding as on 31.03.2014. No interest is being charged on such loans since 01.04.2012 and no recoveries could be made against such outstanding loans during the previous year and this year. However, after negotiations it has now been agreed vide an agreement dated 21.04.14 that the Company will not charge them interest since 01.04.2012 and the said Company will repay the loan amount of Rs. 2,75,01,331/- outstanding as on 31.03.2014 within 4(four) years from the date of agreement dated 21.04.14.The Company has been advised that provisions of section 295 of the Companies Act, 1956 (Corresponding to section 185 of the Companies Act, 2013, applicable since 12.09.2013) are not applicable to such loans.

(ii) The company has been advised that the provisions of Section 372A(3) of the Companies Act, 1956, are not applicable in respect of interest receivable from a related party for the years ended 31.03.2013 and 31.03.2014 being accounted for on cash basis (also refer Note 1(vii)(h) and 11(i) above.

(iii) In respect of excess remuneration of Rs. 6,06,130/- paid to Managing Director in earlier year as referred to in Note 16 in Note 24 in earlier year Accounts, the Company obtained approval of the Shareholders in the Annual General Meeting held on 19th August, 2013 vide Special Resolution approving the remuneration of the Managing Director in pursuance of limit laid out in sub section B of part II of Schedule XIII of the Companies Act, 1956 for the financial year 2012-13 till the remaining period of his tenure to 13.11.2015, subject to the approval of the concerned authorities. However, as the Managing Director has agreed to refund to the Company such excess remuneration of Rs. 6,06,130/-, the Company is not seeking the approval of the concerned authorities.

12) The Company had sold its Chemical Division situated at Tuticorin, Tamilnadu during the year ended 31.03.2012. The Company is now in the process of implementing a Chemical project in Gujarat.

13) The previous year''s figures have been regrouped, rearranged and recasted wherever considered and found necessary to conform with this year''s classification.

Notes:

(1) The above statement is subject to and read together with the notes and observations on Accounts and Schedules attached thereto.

(2) The above Cash Flow Statement has been prepared under the "Indirect Method" as set out in the Accounting Standard-3 on Cash Flow Statements issued by the Institute of Chartered Accountants of India.

(3) Cash & Cash equivalents at start and close of year includes balances on unpaid dividend accounts.

(4) Previous year''s figures have been regrouped, rearranged and recasted wherever found necessary.

This is the Cash Flow Statement referred to in our Report of even date.


Mar 31, 2013

1. SLUMP SALE IN PREVIOUS YEAR

(a) The Company had sold its chemical division situated at Tuticorin, Tamilnadu on a slump sale basis to a party as a going concern effective from 14.10.2011 vide Business Transfer Agreement dated 01.10.2011. The consideration initially agreed at Rs.101 Crores was subject to adjustments as per aforesaid agreement. After adjustments such amount had been determined at Rs.96.44 Crores.

(b) To reflect a true and correct picture of operations of the Company till 14.10.2011, Inventories of Finished Goods, Work in Process and Traded goods transferred in pursuance to the aforesaid agreement were included in amount of sales reflected under Revenue from Operations (Note 16) of the statement of Profit and Loss. Transfer of stock of Raw Materials was also accordingly adjusted in Cost of Materials Consumed (Note 18) of the Statement of Profit and Loss.

(c) Gain on such slump sale and direct expenses(net of service tax) incurred for making the sale were reflected as Extraordinary Items ( Note 23) in the Statement of Profit and Loss.

(d) As per Business Transfer Agreement dated 01.10.2011, all fixed assets, Capital Work in Process, current assets and statutory / other liabilities (including liabilities for sales tax, excise, service tax, labour dues etc.) as on 14.10.2011 and considered to be relating to the chemical division had been taken over by the buyer of the chemical division.

(e) The buyer of the chemical division had withheld a portion of the consideration as stated in clause (a) above to be released only upon conclusion of assessment proceedings under Tamil Nadu Value Added Tax Act, certain pending CENVAT proceedings and submission to the party certificate under section 281 of The Income Tax Act, 1961. According to the management, relevant proceedings are to be concluded in the financial year ending 31.03.2014. Such amount is therefore considered as current assets. Final adjustment is to be made only after proceedings attains finality, the amount in respect of which can not be ascertained presently for provision, if any, necessary.

(f) In view of above slump sale, Company''s results of this year are not comparable with previous year results.

2. The Company is engaged in activity of purchase/sale of various commodities (Castor Seed & Raw Wool). A total quantity of 5,60,585 Bags (P.Y. 25,600 Bags) of various commodities have been purchased for Rs.6395.41 Lacs (P.Y. Rs.771.06 Lacs) and 5,38,070 Bags (P.Y. 5,400 Bags) have been sold for Rs.5876.40 Lacs (P.Y. Rs.156.55 Lacs) during the year. Gain realized, at the end of settlement period, on such transactions has been considered as profit for the year. Payments (outstanding) made by the Company have been considered under Other Current Assets (Note 15).

3. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances of Rs.Nil (P.Y.Rs.1208.13 Lacs) is Rs.1262.78 lacs (P.Y. Rs.1339.02 lacs).

4. Contingent liabilities not provided for in respect of claims against the Company not acknowledged as debts – Rs.Nil (P.Y – Rs.26.41 Lacs). Except as stated above, the management has certified that there are no other pending cases and/or claims against the Company.

5. In the opinion of the Board of Directors, all the assets other than fixed assets and non current investments 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. The provisions for liabilities are adequate and not in excess of the amount reasonably necessary.

6. Accounts in respect of Liabilities, Trade Receivables, Loans, Advances and Other Assets are subject to confirmations of respective parties.

7) Segment Reporting

a) The Company is advised that the activities of the Company in respect of various commodities, as referred to in Note 3 above, do not constitute trading activity in the context of Accounting Standard 17 on "Segment Reporting" and therefore such transactions have not been constituted as "Segment". The Company''s operations during the year comprises of only one segment i.e. Windmill Power Sales. The Auditors have relied on the said opinion in this regard.

b) Identification of Segments:

In previous year, the Company was primarily engaged in the business of manufacture and sale of chemicals (upto 14.10.2011). The Company had identified two primary business segments, namely Chemicals and Power used for chemical division,which in the context of Accounting Standard-17 on " Segment Reporting" constituted reportable segments during the year ended 31.3.2012.

(a) Includes Rs.27,68,000/- Exports through Export Houses/ Merchant Exporters.

(b) Represents Wind Turbine Generator (WTG) power sales.

ii) Fixed Assets as per Geographical locations

The Company has common fixed assets for producing goods for domestic as well as overseas market. Hence, segment wise information for fixed assets / additions to fixed assets cannot be furnished.

8) Related Party Disclosures

(Particulars identified by the Company on the basis of information available and have been relied upon by the Auditors)

i) List of related parties :

A. Key Management Personnel and their relatives

1) Mr.S.K. Jalan (Managing Director)

2) Mr.B.P. Jalan (Father of Mr.S.K. Jalan) (Director)

3) M/s. Bajarang Prasad & Son (HUF) [Mr.B.P. Jalan (Father of Mr.S.K. Jalan) is Karta]

B. Enterprise over which Key Management Personnel and relative of such Key Management Personnel exercise significant influence

1) Kilburn Office Automation Limited

2) Kilburn Software Technologies Limited

3) Shree Durga Agencies Ltd

4) Buckingham Financial Services Ltd

5) Pushpdant Vyapaar Private Ltd

6) Arham Vyapaar Private Ltd.

7) Maryada Advisory Services Private Ltd

8) Kilburn Pigments Ltd

9) The disclosures required as per the revised Accounting Standard (AS) 15 – Employee Benefits notified under the Companies (Accounting Standards) Rules, 2006 for the year ended 31.3.2012 (upto 14.10.2011). Also refer Notes 1(viii) and 2 above.

Defined-Contribution Plans

The Company offered its employees defined contribution plan in the form of provident fund (PF), family pension fund (FPF) and Employees Insurance Scheme (ESI). Provident Fund, family pension fund and Employees State Insurance Scheme cover substantially all regular employees. Contributions were paid during the period into separate funds under certain fiduciary-type arrangements. Both the employees and the Company paid predetermined contributions into the provident fund, family pension fund and the Employees State Insurance Scheme. The contributions were normally based on a certain proportion of the employee''s salary.

Defined-Benefit Plans

The Company offered its employees Defined-Benefit Plans in the form of a gratuity scheme. Benefits under the defined benefit plan was typically based either on years of service and the employee''s compensation (generally immediately before retirement). The gratuity scheme covered substantially all regular employees. The Company contributed funds to Life Insurance Corporation of India, which was irrevocable Commitments were actuarially determined at period-end. The actuarial valuation was done based on "Projected Unit Credit" method. Gains and losses of changed actuarial assumptions were charged to the statement of Profit and Loss. The obligation for leave encashment was recognized in the same manner as gratuity.

10) The position of Company Secretary of the Company was vacant from 17.06.2006 till 02.09.2012.

11) (i) The Company has given loans to a body corporate (outstanding balance as on 31.3.2013 Rs. 2,75,01,331/-

(Previous year Rs. 2,75,01,331/-).The Company is taking steps to obtain legal opinion regarding applicability of section 295 of the Companies Act, 1956 for doing the needful in this regard.

(ii) The Company is taking steps to obtain legal opinion regarding applicability of Section 372A (3) of the Companies Act, 1956, in respect of interest of Rs.33,65,233/- receivable from a related party, this year, being accounted for as and when the same is received (also refer Note 1 (vii) (j) above).

12) Steps are being taken either to recover or obtain the approval/consent of the concerned authorities in respect of excess remuneration of Rs.6,06,130/- as calculated and certified by the Management, paid to the Managing Director, which have been debited to the statement of profit and loss.

13) The previous years figures have been regrouped, rearranged and recasted wherever considered and found necessary to conform with this year''s classification.


Mar 31, 2012

(A) These shares were issued initially for a period of 10 years and redeemable in two equal instalments at the end of the 9th and 10th year from the date of allotment i.e. 23/04/1999. During an earlier year, the redemption had been postponed to 20th year or earlier at the sole discretion of the company.

(B) 2,74,000 (Previous Year 1,17,220) 11 % Cumulative Redeemable Preference shares have been redeemed at par during the year.

Terms/ rights attached to Equity Shares

The Company has only one class of equity shares having a par value of Rs.10/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees.

The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

Since there are no outstanding preference shares,details of rights etc. not mentioned

(a) Term Loans from Banks are secured by a first mortgage and charge (including joint first charge ranking pari-passu) in favour of the lenders of all the Company's immovable properties by way of deposit of title deeds (leasehold land), both present and future and first charge by way of hypothecation in favour of lenders, of all the Company's movables (save and except book debts), including movable plant and machinery, machinery spares, tools and accessories and other movables, present and future, subject to prior charges created and/or to be created in favour of the Company's bankers on the Company's stock of raw-materials, semi-finished and finished goods and consumable stores for securing the Company's borrowings for Working Capital requirements.

Since entire term loan has been repaid, repayment terms of loan outstanding last year are not relevant hence not disclosed

(a) Working Capital Loans from banks are secured by hypothecation of Raw materials, semi-finished and finished goods, consumable stores and spares (present and future), stock in transit and book debts and by way of second mortgage created and/or to be created over all the immovable properties both present and future ranking subject and subservient to the first mortgage created and/or to be created in respect of Term Loans

(a) Includes Rs.5,701/- on no lien account.

(b) Fixed deposit receipts lodged with various government agencies as security (previous year Rs.28,603/-)

(c) The fixed deposits have matured but not renewed. Confirmation certificates were not available.

* There are no stipulations as to repayment of Principal or Interest. The loan is considered repayable on demand. Management considers the Loan as good on the basis of confirmation received from the said body corporate.

(a) Includes Rs.0.55 Lacs (Previous Year Rs.1.90 Lacs) due by officer/s of the company.

(a) Includes Rs.17,53,65,727/- being stock of Finished Goods and Work in Process transferred on account of slump sales referred to in note no. 2 b of Note 26

(b) Includes Rs.1,04,27,985/- for wind power generation adjusted in bills of the party (buyer) to whom slump sale was made. Such amount is on the basis of power bills received by the buyer from Tamilnadu State Electricity Board.

2. SLUMP SALE

a. The company has sold its chemical division situated at Tuticorin, Tamilnadu on a slump sale basis to a party as a going concern effective from 14.10.2011 vide Business Transfer Agreement dated 01.10.2011. The consideration initially agreed at Rs.101 Crores was subject to adjustments as per aforesaid agreement. After adjustments such amount has been determined at Rs.96.44 Crores.

b. To reflect a true and correct picture of operations of the company till 14.10.2011, Inventories of Finished Goods, Work in Process and Traded goods transferred in pursuance to the aforesaid agreement are included in amount of sales reflected under Revenue from Operations (Note no. 17) of the statement of Profit and Loss. Transfer of stock of Raw Materials is also accordingly adjusted in Cost of Materials Consumed (Note no.19) of the Statement of Profit and Loss.

c. Gain on such slump sale and direct expenses(net of service tax) incurred for making the sale are reflected as Extraordinary Items ( Note 24) in the Statement of Profit and Loss.

d. As per Business Transfer Agreement dated 01.10.2011, all fixed assets, Capital Work in Process, current assets and statutory / other liabilities (including liabilities for sales tax, excise, service tax, labour dues etc.) as on 14.10.2011 and considered to be relating to the chemical division have been taken over by the buyer of the chemical division.

e. As certified by the management, the buyer of the chemical division has withheld a portion of the consideration as stated in clause a) above to be released only upon conclusion of assessment proceedings under Tamil Nadu Value Added Tax Act, certain pending CENVAT proceedings and submission to the party certificate under section 281 of The Income Tax Act, 1961. According to the management, relevant proceedings are to be concluded in the financial year ending 31.03.2013. Such amount is therefore considered as current assets. Final adjustment to be made only after proceedings attains finality, the amount in respect of which can not be ascertained presently for provision if any necessary.

f. In view of this slump sale, company's results of this year are not comparable with previous year results.

3. A sum of Rs.12,55,36,765/- has been spent for new project and is included under the head "Capital Advances" (Note 11). An agreement has been entered into with GIDC (Gujarat Industrial Development Corporation) who has allocated land on license basis and a lease of ninety nine years will be executed when other terms and conditions are fulfilled.

4. During the year, the company has engaged in activity of purchase/sale of commodity (Castor Seed) futures. A total quantity of 25600 Bags of Castor Seeds has been purchased for Rs.771.06 Lacs out of which 5400 Bags were sold for Rs.156.55 Lacs during the year. Gain realized, at the end of settlement period, on such transactions has been considered as profit for the year. Payments (outstanding) made by the company have been considered under Other Current Assets (Note 17).

5. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances of Rs.1208.13 Lacs (P.Y. Rs.18.36 Lacs) is Rs.1339.02 lacs (P.Y. Rs.32.95 lacs).

6. Contingent liabilities not provided for in respect of (i) bills discounted with banks Rs._NIL (P.Y. Rs.114.56 Lacs), (ii) Unexpired letters of credit Rs.NIL (P.Y. Rs. 495.50 Lacs), (iii) Guarantees given by Banks Rs.NIL ( P.Y. Rs. 27.50 lacs) (iv) Disputed service tax demands Rs. NIL (P.Y. Rs. 8.20 lacs), (v) Claims against the Company not acknowledged as debts - Rs. 26.41 Lacs (P.Y. Rs. NIL).

As certified by the management, the company does not forsee any liability other than those disclosed in the balance sheet.

7. In the opinion of the Board of Directors, all the assets other than fixed assets and non current investments 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. The provisions for liabilities are adequate and not in excess of the amount reasonably necessary. Provision for tax including tax on slump sale is as estimated and certified by the management which has been relied upon by the auditors.

8. Accounts in respect of Current Liabilities, Trade and other Receivables, Other Current Assets, Loans, Advances and Deposits are subject to confirmation of respective parties.

11. Segment Reporting

a) Identification of Segments: The Company is primarily engaged in the business of manufacture and sale of chemicals (upto 14.10.2011) The Company has identified two primary business segments, namely Chemicals and Power used for chemical division,which in the context of Accounting Standard- 17 on " Segment Reporting" may constitute reportable segment.

Notes:

1. Inter Segment transfer from the power segment is measured at the rate at which power is purchased/ sold/ to the respective Electricity Board.

ii) Geographical Segment

The analysis of Geographical Segment is based on the geographical location of the customers. The geographical segments considered for disclosure are as follows :

i) Sales within India include Sales to customers located within India.

Ii) Sales outside India include Sales to customers located outside India.

ii) Fixed Assets as per Geographical locations

The company has common fixed assets for producing goods for domestic as well as overseas market. Hence, segment wise information for fixed assets / additions to fixed assets cannot be furnished.

9. Related Party Disclosures

(Particulars identified by the Company on the basis of information available and have been relied upon by the Auditors)

i) List of related parties :

A. Key Management Personnel and their relatives

1) Mr. S. K. Jalan (Managing Director)

2) Mr. B. P. Jalan (Father of Mr. S. K. Jalan)(Director)

3) M/s. Bajarang Prasad & Son (HUF) [Mr.B.P. Jalan(Father of Mr.S.K. Jalan) is Karta]

B. Enterprise over which Key Management Personnel and relative of such Key Management Personnel exercise significant influence

1) Kilburn Office Automation Limited

2) Kilburn Software Technologies Limited

3) Shree Durga Agencies Ltd

4) Buckingham Financial Services Ltd

5) Pushpdant Vyapaar Private Ltd

6) Arham Vyapaar Private Ltd.

7) Maryada Advisory Services Private Ltd

8) Kilburn Pigments Ltd

iii) No amounts were written-off or written-back during the period in respect of debts due from or to related parties.

10. The disclosures required as per the revised Accounting Standard (AS) 15 - Employee Benefits notified under the Companies (Accounting Standards) Rules, 2006 are as under.

Defined-Contribution Plans

The Company offers its employees defined contribution plan in the form of provident fund (PF), family pension fund (FPF) and Employees Insurance Scheme (ESI). Provident Fund, family pension fund and Employees State Insurance Scheme cover substantially all regular employees. Contributions are paid during the period into separate funds under certain fiduciary-type arrangements. Both the employees and the company pay predetermined contributions into the provident fund, family pension fund and the Employees State Insurance Scheme. The contributions are normally based on a certain proportion of the employee's salary.

Defined-Benefit Plans

The Company offers its employees Defined-Benefit Plans in the form of a gratuity scheme. Benefits under the defined benefit plan is typically based either on years of service and the employee's compensation (generally immediately before retirement). The gratuity scheme covers substantially all regular employees. The Company contributes funds to Life Insurance Corporation of India, which is irrevocable Commitments are actuarially determined at period-end. The actuarial valuation is done based on "Projected Unit Credit" method. Gains and losses of changed actuarial assumptions are charged to the statement of Profit and Loss. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion, and other relevant factors such as demand and supply in the employment market. The above information is as submitted and or obtained from LICI/Actuary and relied upon by the Auditors.

The contribution expected to be made by the Company for the year ending 31 -03-2013 cannot be readily ascertained and therefore not disclosed.

Note : The above figures are given till 14.10.2011 as the company has thereafter taken steps to transfer the fund assets/liabilities to the buyer of the chemical unit.

Also refer note 1 (viii) above.

11. The position of Company Secretary of the company has been vacant from 17.06.2006 till date.

12. The company has given loans to a body corporate (outstanding balance as on 31.3.2012 Rs. 2,75,01,331/-) (Previous year Rs.2,62,37,377/-).The company is taking steps to obtain legal opinion regarding applicability of section 295 of the Companies Act, 1956 for doing the needful in this regard.

13. During the year ended 31st March 2012, the Revised Schedule VI notified under the Companies Act, 1956 has become applicable to the company for preparation and presentation of its financial statements. The adoption of Revised Schedule VI does not impact recognition and measurement principles followed for presentation of financial statements. However it has significant impact on presentation and disclosures made in the financial statements. The company has also reclassified the previous year figures in accordance with the requirements applicable in the current year.


Mar 31, 2010

1) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances Rs.26.85 lacs (P.Y. : Rs.77.84 lacs) Rs.36.25 lacs (P.Y. Rs.151.36 lacs)

2) Contingent liabilities not provided for in respect of (i) bills discounted with banks Rs. 188.91 Lacs (Previous Year - Rs. 207.01 Lacs), (ii) bonds executed in favour of Excise Authority Rs. NIL (P.Y.: Rs.32 lacs) (iii) Unexpired letters of credit Rs. 504.30 lacs (P.Y. Rs. 188.01 Lacs), (iv) Guarantees given by Banks Rs. 27.50 lacs (P.Y.: Rs. 47.50 lacs) (v) Income Tax demands of Rs. 92.97 lacs for an earlier year, in view of pending appeal (vi) Disputed service tax demands Rs. 9,65,937/-(P.Y.Rs.14.68 lacs) pending in appeals and (vii)Disputed labour demands of Rs. 3,12,967/- (P.Y. Rs.3.13 lacs) pending appeal in court, (viii) Except as stated herein, there are no other pending cases and or claims against the company.

3) In the opinion of the Board of Directors, the Current Assets, Loans, Advances and Deposits are approximately of the value stated, if realised, in the ordinary course of business unless otherwise stated. The provisions for liabilities are adequate and not in excess of the amount reasonably necessary.

4) Segment Reporting

a) Identification of Segments :

i) Business Segment

The Companys operation predominantly comprises of only one segment i.e., manufacturing of chemicals. In view of the same, the matters stated in AS-17 need not be disclosed.

ii) Geographical Segment

The analysis of Geographical Segment is based on the geographical location of the customers. The geographical segments considered for disclosure are as follows :

i) Sales within India include Sales to customers located within India.

ii) Sales outside India include Sales to customers located outside India.

5) Related Party Disclosures

(Particulars identified by the Company on the basis of information available and have been relied upon by the Auditors)

i) List of related parties :

Key Management Personnel and their relatives

1) Mr. S. K. Jalan (Managing Director)

2) Mr. B. P. Jalan (Father of Mr.S.K. Jalan)(Director)

3) M/s.Bairanq Prasad & Son (HUF) TMr.B.P. Jalan(Father of Mr.S.K. Jalan) is Kartal

6) The disclosures required as per the revised Accounting Standard (AS) 15 - Employee Benefits notified under the Companies (Accounting Standards) Rules, 2006 are as under.

Defined-Contribution Plans

The Company offers its employees defined contribution plan in the form of provident fund (PF), family pension fund (FPF) and Employees Insurance Scheme (ESI). Provident Fund, family pension fund and Employees State Insurance Scheme cover substantially all regular employees. Contributions are paid during the year into separate funds under certain fiduciary-type arrangements. Both the employees and the company pay predetermined contributions into the provident fund, family pension fund and the Employees State Insurance Scheme. The contributions are normally based on a certain proportion of the employees salary.

Defined-Benefit Plans

The Company offers its employees Defined-Benefit Plans in the form of a gratuity scheme. Benefits under the defined benefit plan is typically based either on years of service and the employees compensation (generally immediately before retirement). The gratuity scheme covers substantially all regular employees. The Company contributes funds to Life Insurance Corporation of India, which is irrevocable Commitments are actuarially determined at year-end. The actuarial valuation is done based on "Projected Unit Credit" method. Gains and losses of changed actuarial assumptions are charged to the profit and loss account. The obligation for leave encashment is recognized in the same manner as gratuity.

 
Subscribe now to get personal finance updates in your inbox!