Mar 31, 2014
BACK GROUND
The Company is engaged in manufacturing and mixing of fertilisers and
has a network of distributors in the southern states and has developed
a brand value recognised in the market place. The company has planned
to develop a Container Terminal at Ennore.
1
The Company presently is facing certain difficulty in servicing debt
and repayment on time of loans, due to insufficient cash flow from
operations. The Company''s SSP plant has not been put in operation
since May ''14. The Company has business plans to utilize the full
capacity of super phosphate factory in the coming financial year which
would significantly improve profitability. Besides optimum utilization
of additional land available at Ennore for certain specified
diversified business activity would also ensure additional cash
inflows. Further the Company is contemplating to dispose off certain
small parcels of land not useful to the Company to settle certain
creditors.
Taking all the above developments which would significantly improve
the profitability and net worth of the Company, the financial
statements have been prepared on the principles applicable to going
concern.
2 Additional Disclosures
Out of the Paid-up Capital
(i) 22,25,850 Equity Shares of Rs.10/- each were allotted as fully
paid on amalgamation in
February 1972 for consideration other than cash.
(ii) 8,29,760 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash
to certain financial institutions on conversion of part of secured
loans, in the year 1981.
(iii) 20,00,000 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash on 01.10.1983 as per the terms of
issue to the holders of 13.5% Convertible Secured Debentures issued to
the Public.
(iv) 45,68,200 Equity Shares of Rs.10/- each were allotted on 25.08.93
as fully paid on part conversion of 16% Secured Partly convertible
Redeemable Debentures allotted on 25.02.93.
(v) The consent terms filed on 05.03.2000 with the Supreme Court and
decreed by the said Court in the matter of share allotment and sale of
5.33 grounds of land effects of the decree has not been considered in
the books of accounts of the company, since the consent decree terms
are yet to be implemented. A suit has since been filed in Madras High
Court for implementation of the scheme.
3 Loans and advances from banks are secured on immovable properties
and current assets of the Company and guaranteed in certain cases by
the promoter. Negotiations have reached a final stage with respect to
loans due and payable by the Company to a Bank. Secured loans from a
Company and an individual respectively are secured by equitable charge
on certain properties of the Company.
4 The Company''s liability towards Gratuity to employees has been
provided on reasonable basis but not on actuarial basis. The company
has taken steps to determine the liability in accordance with the
Accounting Standard No.15 on "Retirement Benefits" and adjust the
provision accordingly, however in the opinin of the management the
incremental adjustment would not be material.
5 The issue of transfer of unclaimed/unencashed dividends of Rs.6.98
lakhs upto 1981-82 to Government is pending before the High Court of
Judicature at Madras.
Rupees in Lacs March 31, 2014 March 31, 2013
6 Contingent liabilities and commitments (to the extent not provided
for)
Contingent liabilities
(a) Claims against the company not
acknowledged as debt
* Disputed sales tax demands under appeal
including stay of recovery granted
for Rs.854.65 lakhs (Rs.20.50 lakhs paid
under protest included under advances)
(Based on another Supreme Court order and legal
Opinion such demands may not be sustainable) 876.89 876.89
* Others(Exclusive of Interest) 145.00 145.00
Guarantees 7.00 7.00
Other money for which the company is
contingently liable
* Differential Customs Duty on Import machinery
availed under export obligation scheme 117.00 84.07
* Duty on non-fulfilment of Export Obligations 153.00 153.00
* Interest if any, on Mortgage Loan of is
45000000.00 under negotiation along with other
connected issues and the rate of interest and
quantum thereof, if any, and is presently under
negotiation and pending resolution and
quantification of the liability, if any,
has not recognized in the accounts
(b) (i) With regard to interest of Rs.161.33
lakhs claimed by an trade creditor, the
company has since disputed the basis of the
claim and the company proposes to settle the
matter through negotiation.
(ii) With regard to another creditor who has
claimed an interest of Rs.74.39 lakhs, there
is disagreement with respect to the rate of
interest and this matter is expected to be
resolved shortly.
(iii) The claim of interest from Bank i.e.,
State Bank of India (assignee Kotak
Mahindra Bank Ltd) on the principal amount
outstanding is subject of reference to Debt
Recovery Tribunal (DRT) and pending direction
from the Recovery Authority, the loan interest
is not quantifiable at present.
26 Related Parties Disclosure:
(i) Name of the Key Management Personnel:
Mr. Pradip D. Kothari - Chairman and Managing Director No remuneration
was paid to the Managing Director during the year.
(ii) Mrs.Surekha P Kothari, W/o.Chairman & Managing Director has
joined the Board of the company on 19.09.2011.
(iii) Mrs.Antara Pandit, D/o.Chairman and Managing Director has been
working in the company as Vice President (Business Development).
(iv) Name of the transacting related party & description of the
relationship between the parties: Associate Companies/Firms Kothari
(Madras) International Limited
(v) Particulars of Transactions
Nature of Transaction Amount (Rs. in lakhs)
Purchase of Raw Materials & finished goods 1,921.68
Amount of Rs. 63.12 lakhs is outstanding as on
31st March, 2014 from M/s. Kothari (Madras)
International Ltd Remuneration paid to
Mrs.Antara Kothari Rs.3.30 Lacs
7 Earnings /(Loss) per Share - Calculation of weighted average number
of Equity Shares of Rs. 5 each:
March 31, 2014 March 31, 2013
Number of shares of Rs.5/- each 12,483,885 12,483,885
Basic & Diluted Earnings
(in Rupees) per Share (6.91) (168)
8 As per the records and information available with the company there
are no amounts outstanding as on 31st March, 2014 payable to :
(i) Small Scale Industries
(ii) Micro, Small and Medium Enterprises
9 With regard to the pending winding up petition before the Hon''ble
High Court of Judicature at Madras, the Company is under negotiation
with the petitioner for withdrawal of the case
10 The figures in brackets relate to Previous year and regrouped /
reclassified to confirm to the requirements of schedule VI (as
amended) of the companies act 1956.
Mar 31, 2013
A BACK GROUND
The Company is engaged in manufacturing and mixing of fertilisers and
has a network of distributors in the southern states and has developed
a brand value recognised in the market place. The company has planned
to develop a Container Terminal at Ennore.
Rupees in Lacs
March 31, 2013 March 31, 2012
1 Contingent liabilities and
commitments (to the extent not
provided for)
Contingent liabilities
Claims against the company not
acknowledged as debt
-Disputed sales tax demands
under appeal including stay of
recovery granted for Rs.854.65
lakhs (Rs.20.50 lakhs paid unde
protest included under advances)
(Based on another Supreme Court
order and legal Opinion such
demands may not be sustainable) 876.89 876.89
-Others(Exclusive of Interest) 145.00 145.00
Guarantees 7.00 7.00
Other money for which the company
is contingently liable
- Differential Customs Duty on Import
machinery Availed under export
obligation scheme
- Interest if any, on Mortgage
Loan of is 45000000.00 84.07 84.07
under negotiation along with
other connected issues
and the rate of interest and
quantum thereof, if any, and is
presently under negotiation and
pending resolution and quantification
of the liability, if any, has not
recognized in the accounts
Total 1,112.96 1,112.96
2 Related Parties Disclosure:
(i) Name of the Key Management Personnel:
Mr. Pradip D. Kothari - Chairman and Managing Director
No remuneration was paid to the Managing Director during the year.
(ii) Mrs.Surekha P Kothari, W/o.Chairman & Managing Director has joined
the Board of the company on 19.09.2011 (iii) Mrs.Antara Kothari,
D/o.Chairman and Managing Director is working in the company as Vice
President (Business Development) (iv) Name of the transacting related
party & description of the relationship between the parties: Associate
Companies / Firms Kothari (Madras) International Limited
(v) Particulars of Transactions
Nature of Transaction Amount(Rs. in lakhs)
(a)Purchase of Raw Materials & finished goods 1,615.81
Amount of Rs. 122.35 lakhs is outstanding as on 31st March, 2013 from
M/s.Kothari (Madras) International Limited
(b) Remuneration paid to Mrs.Antara Kothari Rs.16.20 lakhs
3 As per the records and information available with the company there
are no amounts outstanding as on 31st March, 2013 payable to :
(i) Small Scale Industries
(ii) Micro, Small and Medium Enterprises
4 With regard to the pending winding up petition before the Hon''ble
High Court of Judicature at Madras, the Company is under negotiation
with the petitioner for withdrawal of the case
5 The figures in brackets relate to Previous year and regrouped /
reclassified to confirm to the requirements of schedule VI (as amended)
of the companies act 1956.
Mar 31, 2012
A BACKGROUND
The Company is engaged in manufacturing and mixing of fertilisers and
has a network of distributors in the ' southern states and has
developed a brand value recognised in the market place. The company has
planned to develop a Container Terminal at Ennore.
Note No :
1. The Company presently is facing' certain difficulty in servicing
debt and repayment on time of loans, due to insufficient cash flow from
operations. The Company has business plans to utilize the full capacity
of super phosphate factory which would significantly improve
profitability besides optimum utilization of additional land available
at Ennore for certain specified diversified business activity which
would ensure additional cash inflows. Further the Company is
contemplating to dispose off certain small parcels of land not useful
to the Company to settle certain creditors. Due to reduction of the
paid-up value of Equity Shares of the Company pursuant to the Order of
the Hon'ble High Court dated 31.08.2010, the net worth of the Company
is fully eroded as at 31s1 March, 2012. The Company has plans to issue
preference shares to Promoters/ Promoter Group and associates which
would bring in additional inflow for operations.
Taking all the above developments which would significantly improve the
profitability and net worth of the Company, the financial statements
have been prepared on the principles applicable to going concern.
2.1 Additional Disclosures
Out of the Paid-up Capital
(i) 22,25,850 Equity Shares of Rs.10/- each were allotted as fully paid
on amalgamation in .
February 1972 for consideration 6ther than cash.
(ii) 8,29,760 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash to certain financial institutions on
conversion of part of secured loans, in the year 1981.
(iii) 20,00,000 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash on 01.10.1983 as per the terms of
issue to the holders of 13.5% Convertible Secured Debentures issued to
the Public.
(iv) 45,68,200 Equity Shares of Rs.10/- each were allotted on 25.08.93
as fully paid on part conversion of 16% Secured Partly convertible
Redeemable Debentures allotted on 25.02.93.
(v) The consent terms filed on 05.03.2000 with the Supreme Court and
decreed by the said Court in the matter of share allotment and sale of
5.33 grounds of land effects of the decree has not been considered in
the books of accounts of the company, since the consent decree terms
are yet to be implemented. A suit has since been filed in Madras High
Court for implementation of the scheme.
The Board is authorized by the shareholders to issue of Equity Shares
on preferential basis to promot- ers / promoters' group / associates
and others immediately after the approval for Reduction of Capital has
been obtained from the Hon'ble High Court of Judicature at Madras and
on completion of necessary formalities regarding listing of shares with
Bombay Stock Exchange.
The shareholders are entitled to dividend when declared. Their rights
are governed by the Articles of Association and the Companies Act,
1956.
3.1 Loans and advances from banks are secured on immovable properties
and current assets of the Company and guaranteed in certain cases by
the promoter. Negotiations have reached a final stage with respect to
loans due and payable by the Company to a Bank. Secured loans from a
Company and an individual respectively are secured by equitable charge
on certain properties of the Company.
4.1 The Company's liability towards Gratuity to employees has been
provided on reasonable basis but not on actuarial basis. The Company
has taken Steps to determine the liability in accordance with the
Accounting Standard No. 15 on "Retirement Benefitsà and adjust the
provision accordingly, how ever, in the opinion of the management the
incremental adjustment would not be material.
5.1 Additional Disclosure
(i) Land and buildings at Fertilizer Division were revalued in the
years 1989, 1992 and again on 1st April 1995.
(ii) Part of the "Kothari Buildingà belonging to the Company was
revalued at the fair market value on 31st March 2012 and on 31st March
2002 respectively by an approved valuer.
6 Contingent liabilities and commitments (to the extent not provided
for) Contingent liabilities Claims against the company not acknowledged
as debt -Disputed sales tax demands under appeal including stay of
recovery granted for Rs.854.65 lakhs (Rs.20.50 lakhs paid under protest
included under advances)
(Based on another Supreme Court order and legal
Opinion such demands may not be sustainable) 876.89 876.89
-Others(Exclusive of Interest) 145.00 145.00
Guarantees 7.00 7.00
Other money for which the company is contingently liable
- Differential Customs Duty on Import machinery Availed
under export obligation scheme 84.07 84.07
- Interest if any, on Mortgage Loan of is 45000000.00 under negotiation
along with other connected issues and the rate of interest and quantum
thereof, if any, and is presently under negotiation and pending
resolution and quantification of the liability, if any, has not
recognized in the accounts Total 1,112.96 1,112.96
7 Related Parties Disclosure:
(i) Name of the Key Management Personnel:
Mr. Pradip D. Kothari - Chairman and Managing Director No remuneration
was paid to the Managing Director during the year.
(ii) Mrs.Surekha P Kothari, W/o.Chairman & Managing Director has
joined the Board of the company on 19.09.2011
(iii) Mrs.Antara Kothari, D/o.Chairman and Managing Director has joined
the company as Vice President (Business Development)
(iv) Name of the transacting related party & description of the
relationship between the parties:
Associate Companies / Firms Kothari (Madras) International Limited
8 As per the records and information available with the company there
are no amounts outstanding as on 31st March, 2012 payable to :
(i) Small Scale Industries
(ii) Micro, Small and Medium Enterprises
9 With regard to the pending winding up petition before the Hon'ble
High Court of Judicature at Madras, the Company is under negotiation
with the petitioner for withdrawal of the case
10 The figures in brackets relate to Previous year and regrouped /
reclassified to confirm to the requirements of schedule VI (as amended)
of the companies act 1956.
Mar 31, 2010
1. The Company presently is facing certain difficulty in servicing
debt and repayment on time of loans, due to insufficient cash flow from
operations. The Company has business plans to utilize the full capacity
of super phosphate factory which would significantly improve
profitability besides optimum utilization of additional iand available
at Ennore for certain specified diversified business activity which
would-ensure additional cash inflows. Further the Company is
contemplating to dispose off certain small parcels of land not useful
to the Company to settle certain creditors. In view of the foregoing
the "Going Concern" aspect of the Company would never get jeoparadised.
2. The Company continues its activities of fertilizer mixing and
trading in pesticides besides receiving the rental income.
The super phosphate factory at Ennore has restarted after the closure
of more than eight years. Considerable expenses had to be incurred to
bring the plant back to production capability as well as the factory
building and other infrastructure having had been in a stage of
neglect. The Board after careful consideration decided appropriately
to capitalize the one time restart expenses which include total
overhauling of the machinery, motors besides adding peripheral
equipments.
The start up expenses including production stabilization being
exceptional in nature have been grouped under Deferred Revenue
Expenditure which being intangible are being amortised over the next
two years during which period the benefit would accrue to the Company.
The Company settled its dues to a bank which involved payment of
arrears of finance charges which has been shown as an exceptional item.
3. SHARE CAPITAL
Out of the Paid-up Capital
(i) 22,25,850 Equity Shares of Rs. 10/- each were allotted as fully
paid on amalgamation in February 1972 for consideration other than
cash.
(ii) 8,29,760 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash to certain financial institutions on
conversion of part of secured loans, in the year 1981.
(iii) 20,00,000 Equity Shares of Rs. 10/- each fully paid were allotted
for consideration other than cash on 01.10.1983 as per the terms of
issue to the holders of 13.5% Convertible Secured Debentures issued to
the Public.
(iv) 45,68,200 Equity Shares of Rs.10/- each were allotted on 25.08.93
as fully paid on part conversion of 16% Secured Partly convertible
Redeemable Debentures allotted on 25.02.93.
(v) 24,74,569 Equity Shares of Rs.10/- each were allotted on 16.05.95
to the Promoters group of which Rs.2.50 per share being the amount
payable on application and allotment amount to Rs.61.86 lakhs was paid
up. The resolution passed by the shareholders authorizing the issue of
above shares has been set aside by the City Civil Court on 14.12.2000
and upon compliance of the necessary formalities including an order
from the High Court, if so required, appropriate adjustments would be
made in the accounts.
(vi) 6,60,598 Equity Shares of Rs. 10/- each were allotted on 20.06.95
to a Overseas Bodies Corporate of which Rs.2.50 per share being amount
payable on application and allotment amounting to Rs. 16.52 lakhs was
paid up. The resolution passed by the shareholders authorizing the
issue of above shares has been set aside by the City Civil Court on
14.12.2000 and upon compliance of the necessary formalities, including
an order from the High Court, if so required, appropriate adjustments
would be made in the accounts.
(vii) The consent terms filed on 05.03.2000 with the Supreme Court and
decreed by the said Court in the matter of share allotment and sale of
5.33 grounds of land effects of the decree has not been considered in
the books of accounts of the company, since the consent decree terms
are yet to be implemented. A suit has since been filed in Madras High
Court for implementation of the scheme.
(viii) An Extra-Ordinary. General Meeting (EGM) of the shareholders of
the Company was held on 12th February, 2009 wherein the shareholders
have approved the proposal for reduction of Face Value of the Equity
Shares from Rs. 10/- each to Rs.5/- per Equity Share along with the
proposal for proportionate reduction of premium on such Equity Shares.
This proposal for Reduction of Capital is subject to approval of the
Honble High Court of Judicature at Madras and the Company has already
filed necessary application with the said Honble High Court in this
regard.
The management is authorized by the shareholders to issue of Equity
Shares on preferential basis to promoters / promoters group /
associates and others immediately after the approval for Reduction of
Capital has been obtained from the Honble High Court of Judicature at
Madras and on completion of necessary formalities with respect to the
Stock Exchanges.
4. SECURED LOANS
Loans and advances from banks are secured on immovable properties and
current assets of the Company and guaranteed in certain cases by the
promoter. The Company has already negotiated with four of its banks and
arrived at One Time Settlement (OTS) on the loans payable to them. With
the funds made available by the funder, the Company has settled in full
the OTS amounts. The dues on account of a bank, one of the bankers,
have been allegedly assigned to Kotak Mahindra Bank Ltd. who has not
substituted themselves in the place of the Bank before the Debt
Recovery Tribunal(DRT). The Company has obtained an interim stay from
the Honble High Court of Judicature at Madras restraining Kotak
Mahindra Bank Ltd. from dealing with any of the properties of the
Company. Secured loans from a company & an individual respectively are
secured by equitable charge on certain properties of the Company.
5. UNSECURED LOANS
Pursuant to the approval of the shareholders at the last Annual General
Meeting for the issue of shares on preferential basis after the Courts
sanction for the reduction in the face value of equity shares,
promoters and few of his business associates have placed share monies
as deposits aggregating to Rs.275.35 lakhs.
6. CONTINGENT LIABILITIES
Rs.in lakhs Rs. in lakhs
31.03.2010 31.03.2009
(i) Outstanding guarantees 7.00 7.00
(ii) Disputed sales tax demands under
appeal including
stay of recovery granted for Rs.854.65 lakhs 876.89 876 89
(Rs.20.50 lakhs paid under protest
included under
advances) (Based on another Supreme Court
order and legal
Opinion such demands may not be sustainable)
(iii) Claims against the Company not
acknowledged as
debt (exclusive of interest) 145.00 145.00
(iv) Differential Customs Duty on Import
machinery
Availed under export obligation scheme 84.07 84.07
(v) Debonding charges on imported machinery
is under representation and
presently not quantifiable - -
(vi) Interest if any payable on Mortgage Loan of 450.00
lakhs is under negotiation along with other
connected issues and the rate of interest and
quantum thereof, if any, and is presently
under negotiation and pending resolution
the liability has not recognized in the accounts
7. The issue of transfer of unclaimed/unencashed dividends of Rs.6 98
lakhs upto 1981-82 to Government is pending before the High Court of
Judicature at Madras.
8. Fixed Assets
(i) Land and buildings at Fertilizer Division were revalued in the
years 1989, 1992 and again on 1st April 1995.
(ii) Part of the "Kothari Building" belonging to the Company was
revalued at the fair market value on 31st March 2002 by an approved
valuer.
(iii) The appreciation in the value of the above fixed assets has been
credited to Fixed Asset Revaluation Reserve.
9. The Companys liability towards Gratuity to employees has been
provided on reasonable estimates but not on actuarial basis. The
Company has taken steps to determine the liability in accordance with
the Accounting Standard No. 15 on "Retirement Benefits" and adjust the
provision accordingly; however, in the opinion of the management the
incremental adjustment would not be material.
10. Related Parties Disclosure:
(a) Name of Key Management Personnel:
Mr.Pradip D. Kothari - Chairman and Managing Director
No remuneration was paid to the Managing Director during the year.
(b) Name of transacting related party & description of the relationship
between the parties:
Associate Companies / Firms Kothari (Madras) International Limited
11. As per the records and information available with the company
there are no amounts outstanding as on 31st March, 2010 payable to: (i)
Small Scale Industries
(ii) Micro, Small and Medium Enterprises
12: The Company is contesting a winding up application before the
Honble High Court of Judicature at Chennai. The Company is reasonably
confident, based on senior counsels opinion, that the petition would
be ultimately disposed off in favour of the Company and no liability
would devolve upon the Company.
13. The figures in brackets relate to previous year and regrouped
wherever necessary.
Jun 30, 2003
1. Share Capital
Out of the Paid-up Capital
(i) 22,25,850 Equity Shares of Rs.10/- each were allotted as fully paid
on amalgamation in February 1972 for consideration other than cash.
(ii) 8,29,760 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash to certain financial institutions on
conversion of part of secured loans, in the year 1981.
(iii) 20,00,000 Equity Shares of Rs.10/- each fully paid were allotted
for consideration other than cash on 1.10.1983 as per the terms of
issue to the holders of 13.5% Convertible Secured Debentures issued to
the Public.
(iv) 45,68,200 Equity Shares of Rs.10/- each were allotted on 25.8.93
as fully paid on part conversion of 16% Secured Partly Convertible
Redeemable Debentures allotted on 25.2.93.
(v) 24,74,569 Equity shares of Rs.10 each were allotted on 16.5.95 to
the Promoters group of which Rs.2.50 per share being the amount payable
on application and allotment amounting to Rs.61.86 lacs was paid up.
The resolution passed by the shareholders authorising the issue of
above shares has been set aside by the City civil court on 14/12/2000
and upon compliance of the necessary formalities including an order
from the High Court if so required, appropriate adjustments would be
made in the accounts.
(vi) 6,60,598 Equity Shares of Rs.10 each were allotted on 20.6.95 to a
Overseas Bodies Corporate of which Rs.2.50 per share being amount
payable on application and allotment amounting to Rs. 16.52 lacs was
paid up. The resolution passed by the shareholders authorising the
issue of above shares has been set aside by the City civil court on
14/12/2000 and upon compliance of the necessary formalities, including
an order from the High Court, if so required, appropriate adjustments
would be made in the accounts.
(vii)The Consent terms filed on 5.3.2000 with the Supreme Court and
decreed by the said Court in the matter of disputed share allotment and
sale of 5.33 grounds of land for adequate consideration, effects of the
decree have not be considered in the books of accounts of the Company,
since the consent decree terms are yet to be implemented.
2. SECURED LOANS
( i ) 16% Secured Redeemable Partly Convertible Debentures
The non-convertible portion of Rs.150/- per debenture, in respect of
16% Secured Redeemable Partly Convertible Debentures (PCD) is to be
redeemed at par in 3 equal installments of Rs.50/- per debenture each
on 25-2-1999, 25-2-2000, and 25-2-2001. The repayment of the principal
amount of the non convertible portion of the PCDs, accrued interest,
remuneration of the Trustees and all other costs, charges and expenses
payable by the Company, on the said non- convertible portion of the
partly convertible debentures are secured by a charge/mortgage on the
immovable properties of the Company excluding assets specifically
charged/mortgaged and such charge/mortgage shall rank second and
subservient to the charges created in favour of the term lending
Institutions/ banks and Trustees for debentureholders in respect of
debentures issued by the Company. Interest on Debenture is net of
remission of interest of Rs.154.15 lacs pursuant to the resolution
passed at the Debentureholders Meeting held on 20th April 2003. This is
subject to the approval of a major debentureholder viz., UTI. Overdue /
penal interest and other charges on account of non-redemption of
debentures on time have not been considered pending the outcome of
negotiations with the debenture trustee.
(ii) Loans and advances from banks are secured on immovable properties
and current assests of the company including immovable property of a
subsidiary of the company and guaranteed in certain cases by the
promoter. Due to non repayment of loans, cash credit including
interest, proceedings have been initiated by the term loan lenders and
banks before Debt Recovery Tribunal and under the Securitisation Act.
The Company has made suitable representation for time for repayment.
The Debt Recovery Tribunal in respect of the term loan has passed an
interim order quantifying the amount due and the interest payable
thereafter which have been recognised in the accounts. The term loan
lender has however initiated proceedings for auctioning the specified
charged property and the matter is before the said Tribunal. The
auction has since been stayed. The Company is in the process of
sourcing funds for repayment of existing amounts due to debenture
holders, banks and financial institutions and also additional working
capital for the business operations.
3. In the absence of profits for the period no allocation could be
made towards Debenture Redemption Reserve. The debentures have however
fallen due for redemption oh 30.9.2003.
4. The Balance available in the approved gratuity fund of Rs. 343.49
lacs as on 30th June 2003 is in the opinion of the management to cover
the liability not evaluated on actuarial basis.
5. Fixed Deposit includes unclaimed matured fixed deposit of Rs.70.16
lacs (including N.RI Deposit of Rs.65.14 lacs). Of the balance Rs.0.03
lacs is repayable within a year.
Rupees in lacs
As on As on
30.06.03 31.03.02
6. Contingent Liabilities
(i) Outstanding guarantees including
guarantee given on behalf
of other companies 820.00 851.45
(ii) Disputed sales tax demands
under appeal including stay of
recovery granted for Rs.854.65 lacs 891.97 960.47
(Rs.20.50 lacs paid under protest
included under advances)
(Based on Supreme Court order
and legal opinion such demands
may not be sustainable)
(iii) Concessional power tariff withdrawn
including belated payment
surcharge relating to erstwhile chemical
division (The matter is
under appeal) An amount of Rs.100 lacs
paid under protest has
not been absorbed pending outcome
of the appeal 328.73 328.73
(iv) Claims against the Company
not acknowledged as debt
(exclusive of interest) 34.72 32.30
(v) Interest payable on future
instalments of the hire purchased assets
1.54 1.51
(vi) Co-leasee obligation on
behalf of other
company (Refer Note No.17(b) Not quantifiable 2097.63
(vii)Differential Customs Duty
on Import machinery availed under
Export Obligation Scheme 84.07 235.03
(Customs authorities have invoked
guarantee amounting to
Rs.62.11 lacs which has been
charged in the accounts)
7. The transfer of unclaimed/uncashed dividends of Rs.6.98 lacs up to
1981-82 to Government is pending for want of certain clarification from
the High Court of Madras consequent on the disposal of writ petition
filed in 1986 in this regard.
8. (i) Plantation lands were revalued in the years 1983,1989,1992 and
again on 1st April 1995. The aggregate amount of such revaluations
after necessary adjustments for sales/transfers up to 30th June 2003,
is Rs.1797.75 Lacs.
(ii) Land,buildings and plant and machinery at Coimbatore and at
Plantations (other than those covered under Note 9(i) above, Fertiliser
division and Coffee Curing Works were revalued in the years 1989,1992
and again on 1st April 1995. The aggregate amount of such revaluations
after necessary adjustments for sales/transfers up to 30th June 2003,
is Rs.2347.48 Lacs.
(iii) Part of the "Kothari Building" belonging to the Company was
revalued at the fair market value on 31st March 2002 by an approved
valuer and the appreciation in the value has been credited to Fixed
Assets Revaluation Reserve. The aggregate amount of such revaluation
after necessary adjustments upto 30.06.03 is Rs.1386.38 lacs.
9 (i) The transfer formalities in respect of Kothari Mill No.2 were
completed during the period.
(ii) The Granite Division is under transfer to a wholly owned
subsidiary, for eventual sale subject to approval of the banks.
Effective from April 2002, the operations of the division are not
reflected in the accounts.
10. Kothari Coffee Curing Works ceased its operations from 1st October
2001. The transfer of the curing works to the identified buyer is
subject to approval of the banks.
11.ADVANCES INCLUDE : a (i) Dues by Subsidiary
Kothari (Madras) International Limited Rs. Nil (Rs.100.19 Lacs)
(maximum amount due in the year - Rs. 102.54 lacs)
(ii) Subsidy receivable on single super-phosphate from the State
Governments Rs.4.52 lacs (Rs.35.91 lacs) (since Received Rs.3.86 lacs)
(iii)Amount due from erstwhile subsidiaries Waterfall (East) Private
Limited and Water fall (West) Private Limited aggregating to Rs.106.73
lacs which is under negotiation for recovery.
b (i) Rs.659.77 lacs (Rs.659.77 lacs) given to a Public Limited Company
in earlier years which is under liquidation proceedings.
(ii) Rs.120.99 lacs (Rs.120.99 lacs) (provided as doubtful debt in the
previous year accounts) has been given to a Public Limited Company in
earlier years, which has suspended Operations.
(iii)Rs.842.58 lacs given to a private limited company including
Rs.57.71 lacs during the year having the object of non-banking finance
company.
12 (i) Due to certain unavoidable reasons the operation of
Superphosphate factory was disrupted and consequently there was no
production during the period. Steps are being taken to resume
production for the current season. However production and sale of
N.P.K. mixtures was not affected and were able to achieve a production
of 31711 M.T. of N.P.K. Mixture for the period April 2002 to June 2003.
(ii) Winding up petitions have been filed in the Court by two trade
Creditors for recovery of Rs.41.50 lacs out of which major amounts have
already been settled.
(iii)Certain proceedings are pending before Mumbai High Court under
Negotiable Instruments Act and the case is being represented by the
company.
13.(i) Interest on Cash Credit Overdraft account and Working Capital
Demand Loan from Banks has been accounted based on the statement of
accounts received.
(ii) Interest on Term Loan with a Bank accounted based on the onetime
settlement arrived on 31.3.2001.
(iii)lnterest has not been accrued on unsecured advances amounting to
Rs. 113.95 lacs.
14.a) One of the leasing Company (since merged with a bank) has
repossesed certain textile machineries acquired under financial lease
arrangements on account of non-payment of overdue instalments of lease
rentals and the matter is before Mumbai High Court. The Company may
become liable for the shortfall of the value of machineries compared to
the amount that would become ultimately payable which is not capable of
quantification at present.
b) No provision has been made in respect of co-lessee obligation in
favour of finance company pending quantification thereof in respect of
which a charge has been created (Note 2 - Schedule 5 - Fixed Assets).
15.(i) Due to change in State Governments policy, the construction
activities of Brewery project in Andhra Pradesh had to be suspended and
an amount of Rs.188.16 lacs included under Capitaf work-in-progress is
being carried forward and is capable of realization on eventual sale
of land and building structures.
(ii) Balance amount of Rs.2.00 lacs included under Capital
work-in-progress is in respect of certain capital expenditure at Tea
Estates pending completion.
16.The accumulated losses incurred by subsidiary - Kothari (Madras)
International Limited - Rs.76.85 Lacs as on 30.9.2002 have not been
presently considered in the accounts.
17.Related Parties Disclosure:
a) Name of Key Management Personnel Mr.Pradip D. Kothari - Chairman and
Director
b) Name of the transacting related party & Description of the
relationship between the parties.
Associate Companies/Firms
i) Kothari Orient Finance Limited
ii) Kothari and Sons (Agencies) Pvt.Ltd.**
iii) Kothari Brown Engineers (India) Pvt. Ltd.
iv) Kothari Enterprises
v) Industrial & Project Consultants Ltd.
vi) Dayanand Mills Ltd.
vii) Fort Agencies Private Limited
viii) Securities Operations & Investments Ltd.**
ix) Underwriters & Financiers Pvt.Ltd.**
x) Ennore chemicals & Fertilisers Pvt. Ltd.**
xi) Mount Agencies Pvt, Ltd.
xii) Teatex Pvt. Ltd.
xiii) Kothari & Sons
xiv) Vaibhava India Pvt. Ltd.
xv) Kothari Realtors Pvt. Ltd.
xvi) Tata Kothari Steels Ltd.
Subsidiary Companies
i) Kothari (Madras) International Limited (KMIL) **
ii) Brooklands Plantations Private Limited (Subsidiary of KMIL)
iii) Adadi Plantations Private Limited (Subsidiary of KMIL)
iv) Burlier Plantations Private Limited (Subsidiary of KMIL)
v) Gurensy Plantations Private Limited (Subsidiary of KMIL)
vi) Chennai Agrotech and Stones Limited**
** Represents Companies with whom transactions have taken place during
the period.
18.As per the accounting Standard AS 22-Accounting for taxes on income
, the company reviewed the deferred tax assets and liabilities. The
timing differences relates mainly to depreciation and carry forward
losses for the period up to 31.03.2003 and for the year ended
30.06.2003,
resulting in a net deferred tax asset of Rs. 8416.21 lacs. As a prudent
measure, this net deferred tax asset has not been recognised in the
accounts in view of uncertainity of taxable income in the immediate
future years.
19.a) In the absence of Audit Committee, accounts have been directly
approved by the Board.
b) The post of the Company Secretary who has resigned recently, has not
been filled up.
20.Certain Customers accounts are to be confirmed/reconciled.
21.The accounts of the current and previous financial years are for the
period of 15 months and 12 months respectively.
22.Events after Balance Sheet
a) The Companys tea plantations Glendale and Adderly estates which
have since been put to auction in December 2004 by the Debenture
Trustee M/s. ICICI Bank is presently under review of the Mumbai High
Court which has passed a conditional order on 12th January 2005, which
conditions if satisified by the Company, the auction would be set
aside.
b) The leasing company (since merged with a bank) referred to in Note
No.17(a) above has since launched legal proceedings for recoveries of
the dues and the matter is pending before the Mumbai High Court.
c) Kothari (Madras) International Limited, ceased to be the Companys
subsidiary since September 2003.
23.The figure in brackets relate to previous year and regrouped
wherever necessary.