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Notes to Accounts of Mahaan Foods Ltd.

Mar 31, 2015

Note 1. Overview

Mahaan Foods Limited (MFL) is an ISO 9001/2000 & HACCUP certified company which was incorporated in 1987. The Company is engaged in manufacturing of dairy products and pharma nutritional products.

Note 2. Share Capital

a) Rights, preferences and restrictions attached to Shares

Equity Shares:

The Company has only one class of equity shares having a par value of Rs.10 per share. Each Shareholder is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company

Note 3 Contingent Liabilities:

Particulars As at 31st As at 31st March, 2015 March, 2014

Sales Tax 53,17,872 53,17,872

Entry tax 5,31,614 5,31,614

Note 4

Some of balance of debtors, creditors and loans and advances are subject to confirmation from" respective parties. No significant impact is expected on the Profit and loss account on this account." The effect of the same if any which is not likely to be material will be adjusted at the time of confirmation."

Note- 5 Employee Benefit's :

Defined Contribution Plans :

The Company charged Rs.NIL (Previous year Rs. 2,15,447.00) for provident fund contribution to the profit and loss account. The contributions towards these schemes by the Company are at rates specified in the rules of the schemes.

Defined Benefit Plans :

Liability for Gratuity and Privilege leaves is determined on actuarial basis.

Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

The basis for determination of liability is as under :

Note- 6 Related Party Disclosures as per Accounting Standard 18.

Names of related party and nature of related party relationship:

Associates

Zeon Life sciences Ltd (Previously known as Mahaan Dairies Ltd)., Mahaan Proteins Ltd., Lactomalt Foods Pvt., Ace International. Healthy India Nutritional Products Pvt. Ltd. Best Milk Foods Pvt. Ltd.

Key Management Personnel: Mr. Sanjeev Goyal, Managing Director and Mrs. Saloni Goyal, Director

Key Management Personnel's relatives: M/s Rajiv Goyal HUF (HUF of Mr. Rajiv Goyal), Mr. Amar Nath Goyal ( Father of Mr. Sanjeev Goyal), M/s A N Goyal HUF( HUF of father of Mr. Sanjeev Goyal), Mr.Rajiv Goyal ( Brother of Mr. Sanjeev Goyal), Mrs. Shashi Goyal (Mother of Mr. Sanjeev Goyal), Mr.Suresh Garg, Mr.Dalip Chand Garg (Father of Mr. Suresh Garg), Mr.Dalip Chand Garg HUF (HUF of Mr. Suresh Garg's Father),Rani Garg (wife of Mr. Suresh Garg)

The following transactions were carried out with the related parties in the ordinary course of business :

Note 7 Exceptional Item (Transfer of Assets & Liabilities under family settlement )

Mahaan group company initially started the business in the year 1987 with equal contribution and participation of Mr. A.N. Goyal and Mr. Suresh Garg.Mr. Rajeev Goyal(son of Mr. A.N. Goyal), Mr. Sanjeev Goyal (son of Mr. A.N. Goyal) and the member of the family thereafter jointly established and promoted the Mahaan Group constituting the various companies referred to as

(a) Mahaan Proteins Ltd.

(b) Zeon Life science Ltd.

(c ) Mahaan food Ltd. (Consisting further 2 unites Mahaan Bioysis and Mahaan Nutritions)

(d) Ace International

And the promoters groups are reffered to as

(a) Mr. A N Goyal as ANG Group

(b) Mr. Suresh Garg as Garg Group

(c) Mr. Saneev Goyal as SG Group

(d) Mr. Rajeev Goyal as RG Group

All the parties enjoyed good relationship and jointly carried on the business of the Mahaan group for more than 2 decades. However with the passage of time, certain disputed and differences arose between the parties and in order to resolve these disputes and differences, The parties decided to re- arrange the ownership of the companies and to divide the assets and liabilities of the Mahaan Group In order to give effect to the family settlement they entered in to the Memorandum of Family Settlement (MOFS) dated 31.08.2010

Broad settlement amongst the groups is as under:-

(a) The Ownership, Management and control of Zeon Lifesience Ltd. and Mahaan Biosys & Mahaan Nutrition both unit of MFL has been decided to be accorded to Mr. Suresh Garg( Garg Group)

(b) The Ownership, Management and control of Mahaan Proteins Ltd has been decided to be accorded to Mr. Rajeev Goyal (RG Group)

(c) The Ownership, Management and control of ACE International and Dairy division of MFL has been decided to be accorded to Mr, Sanjeev Goyal (SG Group)

(d) Payment of 6.8 Crore by Mr. Suresh Garg to other promoters group.

(e) Mr. A.N. Goyal Expressed his desire to retire from active business.

(f) Transfer of Loan liabilities (All secured liabilities towards loans and interests outstanding) of Mahaan Food Ltd. by Garg Group

(g) Transfer of 1 /4th share of property at Greater Kailash by Garg Group in favour of SG Group

(h) Exchange of Shareholding inter se.

Till November 2011 nothing could be executed amongst the groups due to disagreements on various issues in the settlement. Finally application under Section 9 of Arbitration and Conciliatrion Act 1996 was moved by SG Group before the Hon'ble Delhi High Court for expeditious execution of MOFS.

Obligation completed during Financial Year 2012-13

In terms of court order dated 30-5-2012 following compliances were made

1. Garg Group made a part payment of Rs 145 lacs to RG Group

2. Garg Group made payment of Rs. 200 lacs to ANG Group

3. Garg Group , RG Group & ANG Group exchange their respective shareholdings.

Obligation completed during Financial Year 2013-14

In terms of court order dated 10-5-2013 one compliance was made i.e.

1. Garg Group acquired two units of Mahaan Foods Limited namely MB and MN along with assets and liabilities

Pending obligations as on 31.03.2014

Obligation mentioned at serial no. (d), (g), (h) above are pending as on date

Pending obligations as on 31.03.2015

Obligation mentioned at serial no. (d), (g), (h) above are pending as on date

The net difference between the book balances relating to various assets and loans/liabilities taken over by Garg Group and its assumed agreed values has been shown as "Exceptional Item". In previous year. Few book balances are yet to be squared up in view of obligations ransactions which are pending under MOFS as on the date of Balance Sheet.

Note - 8 segment reporting

There are no reportable segments as per Accounting standard standard 17 on segment reporting

Note - 9 Additional information pursuant to the provision of part-ll of Schedule III to the Companies Act, 2013 (Figures in brackets are in respect of previous year.)

Note: Goods manufactured for others:

Complan: The production during the year was NIL MT (Previous Year 899 MT )

B. Licensed Capacity:

Not applicable, as per notification No. 477(E) dated 25.7.91 issued under the Industries (Development & Regulation) Act, 1956.

C. Installed Capacity:

The products are manufactured in integrated plant, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 3,900 MT (Previous year 3,900 MT) for Base Proteins/ Maltodextrine and 6600 MT (Previous year 6,600 MT) for Energy Drinks.

The products viz. Dairy Creamer and Pure Ghee are manufactured in an integrated plant taken on lease, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 5000 MT (Previous year 5000 MT) per annum for various types of Milk powders, 2000 MT (Previous year 2000) per annum for Ghee.

Note 10 General

a. Figures have been rounded off to nearest rupee.

b. Previous year's figures have been regrouped and/or rearranged wherever considered necessary.


Mar 31, 2014

1. Overview

Mahaan Foods Limited (MFL) is an ISO 9001/2000 & HACCUP certified company which was incorporated in 1987. The Company is engaged in manufacturing of dairy products and pharma nutritional products.

2. Rights, prefrences and restrictions attached to shares

Equity Shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each Shareholder is eligible for one vote per share held. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company

3. Vehicle finance loans are secured by hypothecation of vehicles amounting to Rs.19,00,269.00 (Previous year Rs. 26,05,747.00) shown under fixed assets.

**Advances recoverable in cash or in kind or for value to be received includes Rs. 16,24,963.00 (P.Y. 69,85,653.00) due from two parties who were holding office of Directorship in the company during earlier years. Maximum amount due during the year Rs.69,85,653 (P.Y. 69,85,653.00).

** The company generally enters into cancelable operating leases for machinery, office and godown premises and residence to its employees, normally renewable on expiry are and cancelable at its option.

** Lease rent charged to the profit and loss account relating to operating leases are Rs. 1,64,817.00 (Previous year - Rs. 1,95,06,332.00).

Note 4 Contingent Liabilities:

Particular As at As at 31st March, 2014 31st March 2013

Sales Tax 53,17,872 53,17,872

Entry tax 5,31,614 5,31,614

The Company has filed appeal against these liabilities and has been advised that there will not be any liabilities on this account and consequently no provision has been made in the books of accounts.

Note 5

Some of balance of debtors, creditors and loans and advances are subject to confirmation from espective parties. No significant impact is expected on the Profit and loss account on this account. The effect of the same if any which is not likely to be material will be adjusted at the time of confirmation.

Note- 6 Employee Benifites :

a) Defined Contribution Plans :

The Company charged Rs. 2,15,447.00 (Previous year Rs. 8,97,287.00) for provident fund contribution to the profit and loss account. The contributions towards these schemes by the Company are at rates specified in the rules of the schemes.

b) Defined Benefit Plans :

i Liability for Gratuity and Privilege leaves is determined on actuarial basis.

ii Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

The estimate of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotions and other relevant factors such as demand and supply in the employment

Note- 7 Related Party Disclosures as per Accounting Standard 18.

Names of related party and nature of related party relationship:

Associates

Zeon Lifesciences Ltd (Previously known as Mahaan Dairies Ltd)., Mahaan Proteins Ltd., Lactomalt Foods Pvt. Ltd.,

Ace International. Healthy India Nutritional Products Pvt. Ltd. Best Milk Foods Pvt. Ltd.

Key Management Personnel: Mr. Sanjeev Goyal, Managing Director and Mrs. Saloni Goyal, Director Key Management Personnel''s relatives: M/s Rajiv Goyal HUF (HUF of Mr. Rajiv Goyal), Mr. Amar Nath Goyal (Father of Mr. Sanjeev Goyal), M/s A N Goyal HUF( HUF of father of Mr. Sanjeev Goyal), Mr. Rajiv Goyal (Brother of Mr. Sanjeev Goyal), Mrs. Shashi Goyal (Mother of Mr. Sanjeev Goyal), Mr. Suresh Garg, Mr. Dalip Chand Garg (Father of Mr. Suresh Garg), Mr. Dalip Chand Garg HUF (HUF of Mr. Suresh Garg''s Father), Rani Garg (wife of Mr. Suresh Garg)

Note 8 Exceptional Item:-

Mahaan group company initially started the business in the year 1987 with Mr. A.N. Goyal and Mr. Suresh Garg. Mr. Rajiv Goyal (son of Mr. A.N. Goyal), Mr. Sanjeev Goyal (son of Mr. A.N. Goyal) Running it jointly established and promoted the Mahaan Group constituting the various companies referred to as

(a) Mahaan Proteins Ltd.

(b) Zeon Lifescience Ltd.

(c ) Mahaan food Ltd. (Consisting further 2 unites Mahaan Bioysis and Mahaan Nutritions)

(d) Ace International

And the promoters groups are referred to as

(a) Mr. A N Goyal as ANG Group

(b) Mr. Suresh Garg as Garg Group

(c ) Mr. Saneev Goyal as SG Group

(d) Mr. RajIv Goyal as RG Group

All the parties enjoyed good relationship and jointly carried on the business of the Mahaan group for more than 2 decades.

However with the passage of time,

The parties decided to re- arrange the ownership of the companies and entered into a Memorandum of Family Settlement dated 31st August, 2010 taken on record by the Hon''ble Company Law Board, New Delhi via order dated 3rd September, 2010.

Broad settlement amongst the groups is as under:-

(a) The Ownership, Management and control of Zeon Lifescience Ltd. and Mahaan Biosys & Mahaan Nutrition both unit of MFL has been decided to be accorded to Mr. Suresh Garg (Garg Group)

(b) The Ownership, Management and control of Mahaan Proteins Ltd has been decided to be accorded to Mr. Rajiv Goyal (RG Group)

(c) The Ownership, Management of the Dairy division of MFL has been decided to be accorded to Mr. Sanjeev Goyal (SG Group)

(d) Payment of 6.8 Crore by Mr. Suresh Garg to other promoters group.

(e) Mr. A.N. Goyal Expressed his desire to retire from active business.

(f) Transfer of Loan liabilities (All secured liabilities towards loans and interests outstanding) of Mahaan Food Ltd. to be taken over by Garg Group

(g) Transfer of 1/4th share of property at Greater Kailash by Garg Group in favour of SG Group

(h) Exchange of Shareholding.

Till November 2011 nothing could be executed amongst the groups due to disagreements on various issues in the settlement. Finally application under Section 9 of Arbitration and Conciliation Act 1996 was moved by SG Group before the Hon''ble Delhi High Court for expeditious execution of MOFS.

Obligation completed during Financial Year 2012-13

In terms of court order dated 30-5-2012 following compliances were made

1. Garg Group made a part payment of Rs 145 lacs to RG Group

2. Garg Group made payment of Rs. 200 lacs to ANG Group

3. Garg Group , RG Group & ANG Group exchange their respective shareholdings.

4. AN Group also transferred his shares to SG Group

Obligation completed during Financial Year 2013-14

In terms of court order dated 10-5-2013 one compliance was made i.e.

1. Garg Group acquired two units of Mahaan Foods Limited namely MB and MN along with assets and liabilities alongwith the loan liability including interest of State Bank of Patiala and Himachal Pradesh Financial Corporation.

Pending obligations as on 31.03.2014

Obligation mentioned at serial no. (d), (g), (h) above are pending as on date

The net difference between the book balances relating to various assets and loans/liabilities taken over by Garg Group and its assumed agreed values has been shown as "Exceptional Item". Few book balances are yet to be squared up in view of obligationstransactions which are pending under MOFS as on the date of Balance Sheet.

Note 9 Segment reporting

Business Segments

Based on the guiding principles given in Accounting Standard (AS 17) "Segment Reporting" issued by the Institute of Chartered Accountants of india, the Company''s business segments are Dairy (comprising milk powders and Ghee), Non-dairy (comprising maltridexin and base protein) and Energy Drinks. The accounting policies for segment reporting are in line with the accounting policies followed by the company.

Note: Goods manufactured for others:

Complan: The production during the year was 899 MT (Previous Year 1763 MT)

B. Licensed Capacity:

Not applicable, as per notification No. 477(E) dated 25.7.91 issued under the Industries (Development & Regulation) Act, 1956.

C. Installed Capacity:

The products are manufactured in integrated plant, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 3,900 MT (Previous year 3,900 MT) for Base Proteins/Maltodextrine and 6600 MT (Previous year 6,600 MT) for Energy Drinks.

The products viz. Dairy Creamer and Pure Ghee are manufactured in an integrated plant taken on lease, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 5000 MT (Previous year 5000 MT) per annum for various types of Milk powders, 2000 MT (Previous year 2000) per annum for Ghee.

Note 10 General

a. Figures have been rounded off to nearest rupee.

b. Previous year''s figures have been regrouped and/or rearranged wherever considered necessary.


Mar 31, 2012

1. Secured Loans

Secured loans from Financial Institutions and Banks are secured by a mortgage of all the Company''s immovable properties both present and future ranking pari-passu inter-se and a charge by way of hypothecation of all the Company''s movable properties including stocks of raw materials, semi-finished, finished goods, consumable stores and book debts and other specified movable and also guaranteed by some of the directors of the company. Vehicle finance loans are secured by hypothecation of vehicles amounting to Rs. 25,53,879 (Previous year Rs. 20,83,297.) shown under fixed assets.

The Company has filed appeal against these liabilities and has been advised that there will not be any liabilities on this account and consequently no provision has been made in the books of accounts.

2. The Company has not received any confirmation from the suppliers regarding their status of registration under Micro, Small and Medium Enterprises Development Act, 2006, which came into effect from October 2, 2006 and hence disclosure required under the said Act has not been given.

Based upon the information available with the Company, the balance due to the Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 is Rs. Nil (Previous year Rs. Nil). Further, no interest during the year has been paid or payable under the terms of the said Act.

3. Sundry Creditors includes Rs. 2,90,320 (P.Y. Rs. 14,27,029.00 ) due to a Director.

4. Advances recoverable in cash or in kind or for value to be received includes Rs. 69,85,653 (P.Y. 69,60,653) due from two parties who were holding office of Directorship in the company during earlier years . Maximum amount due during the year Rs.69,85,653 (P.Y. 69,60,653).

5. Some of balance of debtors, creditors and loans and advances are subject to confirmation from respective parties. No significant impact is expected on the Profit and loss account on this account. The effect of the same if any which is not likely to be material will be adjusted at the time of confirmation.

6. Operating Lease

i) The company generally enters into cancelable operating leases for machinery, office and godown premises and residence to its employees, normally renewable on expiry are and cancelable at its option.

ii) Lease rent charged to the profit and loss account relating to operating leases are Rs. 1,34,07,720 (Previous year – Rs. 94,67,536).

7 Employee Benefits :

a) Defined Contribution Plans :

The Company charged Rs.11,75,809 (Previous year Rs. 10,06,440) for provident fund contribution to the profit and loss account. The contributions towards these schemes by the Company are at rates specified in the rules of the schemes.

b) Defined Benefit Plans :

i Liability for Gratuity and Privilege leaves is determined on actuarial basis.

ii Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment.Vesting occurs upon completion of five years of service, except death while in employment.

iii The basis for determination of liability is as under :

8 Related Party Disclosures as per Accounting Standard 18.

Names of related party and nature of related party relationship:

Associates

Zeon Lifesciences Ltd (Previously known as Mahaan Dairies Ltd)., Mahaan Proteins Ltd., Lactomalt Foods Pvt.

Ltd., Ace International. Healthy India Nutritional Products Pvt. Ltd. Best Milk Foods Pvt. Ltd.

Key Management Personnel: Mr. Sanjeev Goyal, Managing Director and Mrs. Saloni Goyal, Director

Key Management Personnel''s relatives: M/s Rajiv Goyal HUF (HUF of Mr. Rajiv Goyal), Mr. Amar Nath Goyal ( Father of Mr. Sanjeev Goyal), M/s A N Goyal HUF( HUF of father of Mr. Sanjeev Goyal), Mr.Rajiv Goyal ( Brother of Mr. Sanjeev Goyal), Mrs. Shashi Goyal (Mother of Mr. Sanjeev Goyal), Mr.Suresh Garg, Mr.Dalip Chand Garg (Father of Mr. Suresh Garg), Mr.Dalip Chand Garg HUF (HUF of Mr. Suresh Garg''s Father),Rani Garg (wife of Mr. Suresh Garg)

9 Segment reporting

Business Segments

Based on the guiding principles given in Accounting Standard (AS 17) "Segment Reporting" issued by the Institute of Chartered Accountants of india, the Company''s business segments are Dairy (comprising milk powders and Ghee), Non-dairy (comprising maltridexin and base protein) and Energy Drinks. The accounting policies for segment reporting are in line with the accounting policies followed by the company.

Note: Goods manufactured for others:

Glucon - D: The production during the year was NIL MT (Previous year 1219 MT). Complan: The production during the year was 1482 MT (Previous Year NIL)

B. Licensed Capacity:

Not applicable, as per notification No. 477(E) dated 25.7.91 issued under the Industries (Development & Regulation) Act, 1956.

C. Installed Capacity:

The products are manufactured in integrated plant, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 3,900 MT (Previous year 3,900 MT) for Base Proteins/ Maltodextrine and 6600 MT (Previous year 6,600 MT) for Energy Drinks.

The products viz. Dairy Creamer and Pure Ghee are manufactured in an integrated plant taken on lease, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 5000 MT (Previous year 5000 MT) per annum for various types of Milk powders, 2000 MT (Previous year 2000) per annum for Ghee.

10 General

a. Figures have been rounded off to nearest rupee.

b. Previous year''s figures have been regrouped and/or rearranged wherever considered necessary.

c. Note 1 to 22 form an integral parts of the Accounts and have been duly authenticated.


Mar 31, 2011

1. Secured Loans

Secured loans from Financial Institutions and Banks are secured by a mortgage of all the Company's immovable properties both present and future ranking pari-passu inter-se and a charge by way of hypothecation of all the Company's movable properties including stocks of raw materials, semi-finished, finished goods, consumable stores and book debts and other specified movable and also guaranteed by some of the directors of the company. Vehicle finance loans are secured by hypothecation of vehicles amounting to Rs. 20,83,297 (Previous year Rs.19,24,276) shown under fixed assets.

2. Contingent Liabilities:

Sales Tax 531.79.737 5.31.79.737

Entry tax 5,31,614 5,31,614

The Company has filed appeal against these liabilities and has been advised that there will not be any liabilities on this account and consequently no provision has been made in the books of accounts.

3. The Company has not received any confirmation from the suppliers regarding their status of registration under Micro, Small and Medium Enterprises Development Act, 2006, which came into effect from October 2, 2006 and hence disclosure required under the said Act has not been given.

Based upon the information available with the Company, the balance due to the Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises Development Act, 2006 is Rs. Nil (Previous year Rs. Nil). Further, no interest during the year has been paid or payable under the terms of the said Act.

4. Sundry Creditors include Rs. 14,27,029 (P.Y. Rs. 2,21,050) due to Directors.

5. Advances recoverable in cash or in kind or for value to be received includes Rs. 69,60,653 (P.Y. 62,90,460) due from two Directors. Maximum amount due during the year Rs.69,60,653 (P.Y. 62,90,460).

6. Some of balance of debtors, creditors and loans and advances are subject to confirmation from respective parties. No significant impact in expected on the Profit and loss account on this account. The effect of the same if any which is not likely to be material will be adjusted at the time of confirmation.

7. Operating Lease

i) The company generally entered into cancelable operating leases for machinery, office and go down premises and residence to its employees, normally renewable on expiry and cancelable at its option.

ii) Lease rent charged to the profit and loss account relating to operating leases are Rs. 94,67,536 (Previous year- Rs. 1,14,87,118).

8 The carrying amount of Deferred Tax Liabilities /( Assets ) at each Balance Sheet date is arrived at as follows in accordance with Accounting Standard 22 as issued by The Institute of Chartered Accountants of India :

Note: Computation of net profit under section 198 of the Companies Act. 1956 for the purpose of the payment of managerial remuneration has not been enumerated as no commission is payable.

9 Employee Benefits :

a) Defined Contribution Plans :

The Company charged Rs.10,06.440 (Previous year Rs. 10,79,641) for provident fund contribution to the profit and loss account. The contributions towards these schemes by the Company are at rates specified in the rules of the schemes.

b) Defined Benefit Plans :

i Liability for Gratuity and Privilege leaves is determined on actuarial basis.

ii Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

The estimate of future salary increase, considered in actuarial valuation, take account of inflation, seniority, promotions and other relevant factors such as demand and supply in the employment market.

10 Related Party Disclosures as per Accounting Standard 18.

Names of related party and nature of related party relationship:

Associates

Zeon Life sciences Ltd (Previously known as Mahaan Dairies Ltd)., Mahaan Proteins Ltd., Lacto malt Foods Pvt.

Ltd.. Ace International. Healthy India Nutritional Products Pvt. Ltd. Best Milk Foods Pvt. Ltd.

Key Management Personnel: Mr. Sanjeev Goyal, Managing Director and Mrs. Saloni Goyal, Director

Key Management Personnel's relatives: M/s Rajiv Goyal HUF (HUF of Mr. Rajiv Goyal), Mr. Amar Nath Goyal ( Father of Mr. Sanjeev Goyal), M/s A N Goyal HUF( HUF of father of Mr. Sanjeev Goyal), Mr.Rajiv Goyal ( Brother of Mr. Sanjeev Goyal), Mrs. Shashi Goyal (Mother of Mr. Sanjeev Goyal), Mr.Suresh Garg.Mr.Dalip Chand Garg (Father of Suresh Garg). Mr.Dalip Chand Garg HUF (HUF of Mr. Suresh Garg's Father),Rani Garg (wife of Mr. Suresh Garg)

11 Segment reporting

Business Segments

Based on the guiding principles given in Accounting Standard (AS 17) "Segment Reporting" issued by the Institute of Chartered Accountants of india. the Company's business segments are Dairy (comprising milk powders and Ghee), Non-dairy (comprising maltridexin and base protein) and Energy Drinks. The accounting policies for segment reporting are in line with the accounting policies followed by the company.

Note: Goods manufactured for others:

Glucon - A: The production during the year was 1219 MT (Previous year 4875 MT).

B. Licensed Capacity:

Not applicable, as per notification No. 477(E) dated 25.7.91 issued under the Industries (Development & Regulation) Act, 1956.

C. Installed Capacity:

The products are manufactured in integrated plant, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 3.900 MT (Previous year 3,900 MT) for Base Proteins/ Maltodextrine and 6600 MT (Previous year 6,600 MT) for Energy Drinks.

The products viz. Dairy Creamer and Pure Ghee are manufactured in an integrated plant taken on lease, hence product wise installed capacity cannot be given. However, as certified by the Management, the installed capacity is 5000 MT (Previous year 5000 MT) per annum for various types of Milk powders. 2000 MT (Previous year 2000) per annum for Ghee. - 17 General

a. Figures have been rounded off to nearest rupee.

b. Previous year's figures have been regrouped and/or rearranged wherever considered necessary.

c. Schedules A to O form an integral parts of the Accounts and have been duly authenticated.


Mar 31, 2010

1. Secured Loans

Secured loans from Financial Institutions and Banks are secured by a mortgage of all the Companys immovable properties both present and future ranking pari-passu inter-se and a charge by way of hypothecation of all the Companys movable properties including stocks of raw materials, semi-finished, finished goods, consumable stores and book debts and other specified movable and also guaranteed by some of the directors of the company. Vehicle finance loans are secured by hypothecation of vehicles amounting to Rs. 21,68,207 (Previous year Rs. 16,59,853) shown under fixed assets.

2. Contingent Liabilities:

Sales Tax 51,80,203 43,30,759

The Company has filed appeal against these liabilities and has been advised that there will not be any liabilities on this account and consequently no provision has been made in the books of accounts.

3. The Company has not received any confirmation from the suppliers regarding their status of registration under Micro, Small and Medium Enterprises Development Act, 2006, which came into effect from October 2, 2006 and hence disclosure required under the said Act has not been given.

Based upon the information available with the Company, the balance due to the Micro and Small Enterprises as defined under the Micro, Small and Medium Enterprises

Development Act, 2006 is Rs. Nil (Previous year Rs. Nil). Further, no interest during the year has been paid or payable under the terms of the said Act.

4. Unsecured Loans includes Rs. Nil (P.Y. RS. 6,83,409) due to a Director. Sundry Creditors includes Rs. 1,50,000 (P.Y. Rs. 2,83,790) due to a Director.

5. Advances recoverable in cash or in kind or for value to be received includes Rs. 49,44,381 (P.Y. 9,72,536) due from Directors. Maximum amount due during the year Rs. 50,22,142 (P.Y. 10,36,312).

6. Some of balance of debtors, creditors and loans and advances are subject to reconciliation / confirmation from respective parties. No significant impact in expected on the Profit and loss account on this account.

7. Operating Lease

i) The company generally entered into cancelable operating leases for machinery, office and godown premises and residence to its employees, normally renewable on expiry and cancelable at its option.

ii) Lease rent charged to the profit and loss account relating to operating leases are Rs. 1,52,38,414 (FY 2007-08 - Rs. 1,12,41,129)

12 Employee Benefits :

a) Defined Contribution Plans :

The Company charged Rs.11,36,623 (Previous year Rs. 858390) for provident fund contribution to the profit and loss account. The contributions towards these schemes by the Company are at rates specified in the rules of the schemes.

b) Defined Benefit Plans :

i Liability for Gratuity and Privilege leaves is determined on actuarial basis.

ii Gratuity Scheme provides for a lump sum payment to vested employees at retirement, death while in employment or on termination of employment. Vesting occurs upon completion of five years of service, except death while in employment.

13 Related Party Disclosures as per Accounting Standard 18.

Names of related party and nature of related party relationship:

Associates:

Zeon Lifesciences Ltd (Previously known as Mahaan Dairies Ltd)., Mahaan Proteins Ltd., Lactomalt Foods Pvt. Ltd., Ace International, Best Milk Foods Pvt. Ltd.

Key Management Personnel:

Mr. Rajiv Goyal, Managing Director and Mr. Suresh Garg, Director

Key Management Personnels relatives:

M/s Rajiv Goyal HUF (HUF of Mr. Rajiv Goyal), Mr. Amar Nath Goyal ( Father of Mr. Rajiv Goyal), M/s A N Goyal HUF( HUF of father of Mr. Rajiv Goyal), Mr. Sanjeev Goyal (Brother of Mr. Rajiv Goyal), Mrs. Shashi Goyal (Mother of Mr. Rajiv Goyal), Mr. Dalip Chand Garg (father of Suresh garg), Mr. Dalip chand garg HUF (HUF of Mr. Suresh Gargs father), Rani Garg (wife of Mr. Suresh Garg)

 
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