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Notes to Accounts of Lux Industries Ltd.

Mar 31, 2015

1. Rights, Preference and Restrictions attached to Equity and Preference shares

The Company has equity shares with a par value of Rs.10/- per share .. Each holder of equity shares is entitled to one vote per share held. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directs is subject to the approval of the shareholders in the ensuing general meeting.

2. In the event of liquidation of the Company, the holders of equity shares are entitled to receive the remaining assets of the Company, after meeting all liabilities and distribution of all preferential amounts, in proportion to their shareholding.

3. The company has issued Non Convertible Redeemable Preference Shares by converting unsecured loan of promoters group as per terms of sanction of financial assistance by the State Bank of India. The holders of these shares are entitled to a dividend of 0.25%.

4. Preference shares carry a preferential right as to dividend over equity share holders. The preference share holders shall not carry any voting rights. Such preference shares shall be redeemed at a premium within twenty years from the date of allotments. In the event of liquidation , preference shareholders have a preferential right over equity share holders to be repaid to the extent of capital paidup and dividend arrear on such shares.

5. Depreciation on Tangible assets for the year is Rs. 474.50 lacs. Surplus arising on account of change in method of Depreciation has been creditted in the books of account amounting Rs.904.68/-. Depreciation charge for the year has been disclosed net of this credit .

6. Miscellaneous Expenses includes expenditure related to Corporate Social responsibility as per section 135 of the Companies Act, 2013 read with Schedule VII thereof amounting Rs.65.39 lakhs.

7. Particulars of Contingent Liabilities and Commitments

Particulars 2014-15 2013-14

1. Contingent Liabilities not provided for in respect of:

(i) Guarantee given:

(a) to W.B. Sales Tax Department 2.50 2.50 by the company's banker for which counter guarantees have been given by the company

(b) to Commissioner of Customs, Kolkata 1.40 1.40

(c) to Commissioner of Customs, Kolkata 4.85 4.85

(d) to Sales Tax Department, Roorkee 0.15 0.15

(e) to Sales Tax Department, Ahmedabad 0.20 0.20

(f) to Sales Tax Department, Indore 0.15 0.15

(g) to Commissioner of Customs, Kolkata 0.38 0.38

(h) to Commissioner of Customs, Kolkata 0.61 0.61

(i) to Commissioner of Customs, Kolkata 0.12 0.12

(j) to WBSEB, Kolkata 1.41 1.41

(ii) Sales Tax Penalty for F.Y. 2004-05 under appeal with Assistant Commissioner, 122.96 122.96 Pollachi*

(iii) Sales tax penalty for F.Y 2003-04 under appeal with Kolkata High Court 30.84 30.84

(iv) Sales tax penalty for F.Y 2004-05 under appeal with Kolkata High Court 19.17 19.17

(v) Sales tax & penalty for F.Y 2009-10 under appeal with Assistant Commissioner 117.00 117.00 of Commercial Taxes Avinashi

(vi) Sales tax & penalty for F.Y 2010-11 under appeal with Assistant Commissioner 5.17 5.17 of Commercial Taxes Avinashi

(vii) Sales tax & penalty for F.Y 2011-12 under appeal with Assistant 3.26 3.26 Commissioner of Commercial Taxes Avinashi

(viii) Excise Duty & penalty for F.Y 2011-12 under appeal with Customs, Excise 100.51 100.51 & service Tax Appellate Tribunal

(ix) Sales Tax (VAT) for the F.Y 2009-10 under appeal with senior joint - 19.06 commissioner, sales tax, Kolkata north circle

(x) Central sales tax for the F.Y 2009-10 under appeal with senior joint - 7.21 commissioner, sales tax, Kolkata north circle

(xi) Sales Tax (VAT) for the F.Y 2010-11 under appeal with senior joint - 1.87 commissioner, sales tax, Kolkata north circle

(xii) Central sales tax for the F.Y 2010-11 under appeal with senior joint - 12.18 commissioner, sales tax,Kolkata north circle

(xiii) Service tax & penalty for F.Y 2007-08 to 2011-12 under appeal with 136.22 136.22 Customs,Excise & service Tax Appellate Tribunal

(xiv) Excise Duty & penalty for F.Y 2012-13 under appeal with Customs, Excise 47.79 - & service Tax Appellate Tribunal

* The Company has been advised by competent legal professional that the said demand and Penalty is likely to be reversed, accordingly no provision has been made in the accounts.

2. Capital and Other Commitments 2014-15 2013-14

a. Estimated amount of contracts 9.79 2,878.54 remaining to be executed on Capital account and not provided for (Net of Advances)

b. The company has a export sales NIL 87.66 commitment towards use of EPCG License for which export sales to be achieved within eight years

8. Segment Reporting:

(a) The Company has only one business segment viz. manufacturing and sale of knitwear, which is treated as the primary segment by the company.

(b) The company has two geographical segments viz. Sales within India and Sales outside India. These are treated as secondary segments of the company.

(c) Secondary Segment Information (Geographical Segments)

9. Related Party Disclosures as required by Accounting Standard (AS-18) on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India, are as below:-

a) Key Managerial Personnel:

1. Shri Ashok Kumar Todi, Executive Chairman (Whole Time Director) 2. Shri Pradip Kumar Todi, Managing Director

b) Relatives of Key Managerial Personnel:

1. Shri Saket Todi 2. Shri Udit Todi 3. Miss Priyanka Todi

c) Associates controlled by Director/Relatives:

Biswnath Hosiery Mills Ltd. Todi Hosiery. Ltd. Rotex Intertrade Pvt. Ltd. Chitragupta Sale & Services Pvt. Ltd. Holly Field Traders Pvt. Ltd. Ebell Fashions Pvt. Ltd. Jaytee Exports PG. Infometic Pvt. Ltd.

10. Gratuity benefit plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Company has not funded the scheme.


Mar 31, 2013

1. The Company has only one class of equity shares with a par value of ' 10/- per share. Each holder of equity shares is entitled to one vote per share held. 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. In the event of liquidation of the Company, the holders of equity shares are entitled to receive the remaining assets of the Company, after meeting all liabilities and distribution of all preferential amounts, in proportion to their shareholding.

2. Cash Credit loan is secured against hypothecation of entire stocks, book debts and other current assets , both present and future of Company. The Cash Credit loan are repayable on demand. It is additionally secured by personal guarantee of the directors.

3. PARTICULARS OF CONTINGENT LIABILITIES AND COMMITMENTS $in Lacs)

Particulars 2012-13 2011-12

1. Contingent Liabilities not provided for in respect of:

i. Guarantee given:

a. to W.B. Sales Tax Department by the company's banker for which counter guarantees 2.5 2.5

have been given by the company

b. to Commissioner of Customs, Kolkata 1.4 1.4

c. to Commissioner of Customs, Kolkata 4.85 4.85

d. to Sales Tax Department, Roorkee 0.15 0.15

e. to Sales Tax Department, Ahmedabad 0.2 0.2

f. to Sales Tax Department, Indore 0.15 0.15

g. to Commissioner of Customs, Kolkata 0.38 0.38

h. to Commissioner of Customs, Kolkata 0.61 0.61

i. to Commissioner of Customs, Kolkata 0.12 0.12

j. to WBSEB, Kolkata 1.41 1.41

ii. Sales Tax Penalty for F.Y. 2004-05 122.96 122.96 under appeal with Assistant Commissioner, Pollachi*

iii. Sales tax demand for F.Y 2003-04 Nil 20.87 under appeal with Kolkata High Court

iv. Sales tax penalty for F.Y 2003-04 30.84 30.84 under appeal with Kolkata High Court

v. Sales tax penalty for F.Y 2004-05 19.17 19.17 under appeal with Kolkata High Court

*The Company has been advised by competent legal professional that the said demand and Penalty is likely to be reversed, accordingly no provision has been made in the accounts.

4. Commitments

Estimated amount of contracts remaining to be executed on Capital account and 3,000 36 not provided for

5. SEGMENT REPORTING

a. The Company has only one business segment viz. manufacturing and sale of knitwear, which is treated as the primary segment by the company.

b. The company has two geographical segments viz. Sales within India and Sales outside India. These are treated as secondary segments of the company.

c. Secondary Segment Information (Geographical Segments)

6. Related Party Disclosures as required by Accounting Standard (AS-18) on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India, are as below:-

a. Key managerial Personnel:

1. Shri Ashok Kumar Todi, Executive Chairman (Whole Time Director) 2. Shri Pradip Kumar Todi, Managing Director

b. Associates controlled by Director/Relatives:

Biswnath Hosiery Mills Ltd. Todi Hosiery. Ltd. Rotex Intertrade Pvt. Ltd. Chitragupta Sale & Services Pvt. Ltd. Holly Field Traders Pvt. Ltd. Ebel Polymers Pvt. Ltd. Jaytee Exports Pvt. Ltd. P.G.Infometic Pvt. Ltd.

7. GRATUITY BENEFIT PLANS

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Company has not funded the scheme.

8. The following table's summaries the components of the net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for respective plans.

9. PREVIOUS YEAR FIGURES HAVE BEEN RECAST/ RESTATED WHENEVER REQUIRED


Mar 31, 2012

1. The Company has only one class of equity shares with a par value of Rs.10/- per share. Each holder of equity shares is entitled to one vote per share held. 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. In the event of liquidation of the Company ,the holders of equity share are entitled to receive the remaining assets of the Company, after meeting all liabilities and distribution of all preferential amounts, in proportion to their shareholding.

2. The Company has received unsecured loan from directors of the Company to fulfill the requirement of the stipulation imposed by the Company's Banker for sanction of working loan facilities. The loan is not covered in the definition of deposit as per sub rule (b) (xi) of rule 2 of the Companies (Acceptance of Deposits) Rules, 1975. The Loan from directors are takes at nil rate of interest.

3. Cash Credit loan is secured against hypthecation of entire stocks, book debts and other current assets , both present and future of Company. The Cash Credit loan are repayable on demand. It is additionaly secured by personal gurrantee of the directors.

4. Particulars Contingent Liabilities and Commitments

Particulars 2012 2011

1. Contingent Liabilities not provided for in respect of:

(i) Guarantee given:

(a) to W.B. Sales Tax Department by the company's banker for

which counter guarantees have been given by the company 2.50 2.50

(b) to Commissioner of Customs, Kolkata 1.40 1.40

(c) to Commissioner of Customs, Kolkata 4.85 4.85

(d) to Sales Tax Department, Roorkee 0.15 0.15

(e) to Sales Tax Department, Ahmedabad 0.20 0.20

(f) to Sales Tax Department, Indore 0.15 0.15

(g) to Commissioner of Customs, Kolkata 0.38 0.38

(h) to Commissioner of Customs, Kolkata 0.61 0.61

(i) to Commissioner of Customs, Kolkata 0.12 0.12

(j) to WBSEB, Kolkata 1.41 1.41

(ii) Sales Tax Penalty for F.Y. 2004-05 under appeal with Assistant Commissioner, Pollachi* 122.96 122.96

(iii) Sales Tax demand for F.Y. 2003-04 under appeal with Kolkata High Court* 20.87 20.87

(iv) Sales Tax Penalty for F.Y. 2003-04 under appeal with Kolkata High Court* — 30.84

(v) Sales Tax Penalty for F.Y. 2004-05 under appeal with Kolkata High Court* — 19.17

(vi) Claim not acknowledge as debt — —

5. Commitments

Estimated amount of contracts remaining to be executed on

Capital account and not provided for 36.00 30.00

* The Company has been advised by competent legal professional that the said demand and penalty is likely to be reversed, accordingly no provision has been made in the accounts.

6. Segment Reporting:

(a) The Company has only one business segment viz. manufacturing and sale of knitwear, which is treated as the primary segment by the company.

(b) The company has two geographical segments viz. Sales within India and Sales outside India. These are treated as secondary segments of the company.

(c) Secondary Segment Information (Geographical Segments)

7. Related Party Disclosures as required by Accounting Standard (AS-18) on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India, are as below:-

a) Keymanagerial Personnel:

1. Mr. Ashok Kumar Todi, Executive Chairman (Whole Time Director) 2. Mr. Pradip Kumar Todi, Managing Director

b) Associates controlled by Director/Relatives:

Biswnath Hosiery Mills Ltd. Todi Hosiery Pvt. Ltd. Rotex Intertrade Pvt. Ltd. Chitragupta Sale & Services Pvt. Ltd. Holly Field Traders Pvt. Ltd. Ebel Polymers Pvt. Ltd. Jaytee Exports P G. Infometic Pvt. Ltd.

8. Gratuity benefit plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Company has not funded the scheme.

9 The following table's summaries the components of the net benefit expenses recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for respective plans.

10. During the previous year pursuant to imposition of excise duty on readymade garments and made up article under chapter 61- 63 of the central excise tariff, the company had accounted for excise duty paid on input goods, capital goods and service tax on inputs amounting to Rs 47.96 lacs as expense under respective accounting heads.

11. However, as per Cenvat credit rules the company is eligible for cenvat credit of excise duty paid on inputs, capital goods and service tax paid on input services.

12. During the current financial year, based on the decision of the management and the interpretations of the relevant provisions of the act, the company has claimed an amount of Rs 47.96 Lacs as credit of excise duty paid on inputs, capital goods and service tax paid on inputs crediting prior period income account. This is keeping with the provision of AS -5" net profit or loss for the period, prior period items".

13. The revised Schedule VI as notified under the Companies Act 1956 has become applicable for the company for presentation of its financial statements for the year ending March 31,2012. The adoption of the revised Schedule VI requirements has significantly modified the presentation and disclosures which have been complied with in these financial statements. Previous year figures have been re-grouped, re-arranged and re-casted wherever considered necessary.


Mar 31, 2011

1. (a) Cash Credit facilities with Allahabad Bank are secured by

hypothecation over entire stock, book debts and other Current Assets of the Company, both present and future and by way of collateral security over the entire Movable & Immovable properties of the Company both present & future. It is additionally secured by personal guarantee of the Directors.

(b) Term loan is secured by hypothecation over the machineries/ equipment acquired out of the facility and collateral security over the entire movable and immovable properties of the Company both present and future. It is additionally secured by personal guarantee of the directors.

(c) The Company has received unsecured loan from directors of the Company to fulfill the requirement of the stipulation imposed by the Company's Banker for sanction of working loan facilities. The loan is not covered in t he definition of deposit as per sub rule (b) (xi) of rule 2 of the Companies (Acceptance of Deposits) Rules, 1975. The Loan from directors are takes at nil rate of interest.

(d) Term loan instalments failling due for payment within one year aggregate to Rs. 47 lacs.( previous year Rs. 47 Lacs)

2. The Government of India has imposed Excise duty in the current year's budget @ 10% on ready made garments and made up articles falling under chapter 61 to 63 of Central Excise Tariff when they bear or are sold under a brand name , on which duty is to be paid on a tariff value equal to 45% of the retail sale price As per Cenvat Credit Rules , the Company may be eligible for credit of Excise duty paid on inputs goods, capital goods and service tax paid on input services amounting to Rs 47.96 Lacs for the period upto 31.03.2011. However in view of the legal opinion received by the management , regarding the inadmissibility of such credit , the amount paid has been recognized as expenses under respective accounting heads. This is in keeping with the concept of prudence which requires that no contingent assets should be recognized in books of accounts. This has resulted in the profit for the year being lower by Rs 47.96 Lacs

3. Fixed Deposit amounting to Rs. 5,091,395.00 (Previous Year Rs. 3,320,637.00) and accrued interest on such fixed deposit Rs. 893,673.59 (Previous Year Rs. 518,581.59) is pledged with the bankers of the company.

4. Debtors and creditors, including advances, are subject to confirmation and reconciliation, if any.

5. Segment Reporting:

(a) The Company operating operation comprises of only one primary segment viz. manufacturing and sale of Knitwear's. Company's sales are affected in the domestic and export market, there are two secondary segments as geographical segments viz. Domestic and export.

6. Related Party Disclosures as required by Accounting Standard (AS-18) on "Related Party Disclosures" issued by the Institute of Chartered Accountants of India, are as below:-

b)Associates controlled by Director/Relatives

a) Key managerial Personnel Biswnath Hosiery Mills Ltd. 1. Shri Ashok Kumar Todi, Todi Hosiery Pvt. Ltd. Executive Chairman (Whole Time Director) Rotex Intertrade Pvt Ltd. Chitragupta Sale & Services Pvt. Ltd.

2 Shri Pradip Kumar Todi, Holly Field Traders Pvt. Ltd. Managing Director Ebel Polymers Pvt. Ltd. Jay tee Exports P G. Infometic Pvt. Ltd. Shakuntala Devi Todi Charitable Trust

7. (a) Selling Expenses includes discounts amounting to Rs.24,488,650.00 (Previous year Rs. 4,19,09,033.38)

(b) Commission paid represents commission paid to selling agents. The companies do not have any sole selling agent.

(c) In view of the prevailing Income Tax laws no tax deducted at source is required to be deducted on dividend paid / proposed during the year.

8. Salary consists of Bonus amounting to Rs.27, 50,381.00 (Previous Year Rs. 11,35,984.00).

9. The Company follows Accounting Standard (AS-22) "Accounting for taxes on Income", issued by the Institute of Chartered Accountants of India". The Company has significant timing differences between accounting and tax records which suggest accounting for deferred tax assets which are as below:

10. Based on the information / documents available with the Company, details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006 are as below:

11. Gratuity benefit plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The Company has not funded the scheme.

The following table's summaries the components of the net benefit expenses recognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for respective plans.

12. Disclosures required by Accounting Standard (AS -29) - "Provisions, Contingent Liabilities and Contingent Assets" are as below:

13. The year end foreign currency exposure that have not been hedged by a derivative instrument or otherwise are given below:

14. Additional information pursuant to the provisions of paragraph 3, 4C and 4D of Part II of the schedule VI of the Companies Act, 1956, (as complied & certified by the management, not verifiable by auditor in absence of detailed records).

15. Other information required to be furnished, as per clause 4 of Schedule VI, Part II may be read as NIL.

16. Previous year figures have been re-grouped, re-arranged and re-casted wherever considered necessary. As per out report of even date attached.

 
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