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Notes to Accounts of Mahalaxmi Seamless Ltd.

Mar 31, 2015

1. Share Capital

a) Term Rights Attached to equity shares

The company has one class of equity share having a par value of Rs. 10 per . Each holder of equity shares is entitled to one vote per share . The dividend,if any, is declared and paid in Indian Rupees. The dividend , if any,proposed by the Board of Director is subject to the approval of the holders in the ensuing Annual General Meeting.

In the event of Liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the holders

b) Nil number of bonus shares issued, shares issued for consideration other than cash and share bought back during the period of five years immediately preceeding the reporting date .

2) Contingent Liabilities

i) Counter Guarantee given to the Bank for the performance guarantee given by them of Rs 32.77 Lacs (P.Y. Rs.38.45 Lacs).

ii) Disputed sales tax liability of Rs 65,57,957/- for F.Y 2004-05- (P.Y.65,57,957).

iii) Letters of Credit outstanding of Rs 1,65,09,702/- (P.Y. 1,83,72,886).

iv) There are some labour related matters pending in the Labour Court at Raigad and Mumbai. The Company's Liability towards such matters cannot be ascertained..

v) The Company had imported certain items under the Duty Free Advance Authorisation Scheme. The total value of the Bond given is Rs 2,03,01,500/-. The Company was unable to complete its export obligation in respect of such imports.

The Company has applied to the Directorate General of Foreign Trade for granting extension of the time period for fulfillment of its export obligation. The approval for the same is awaited.

3) Income Tax

i) Due to net loss the company has not made any provision of Current Tax under the provisions of Income Tax Act, 1961.

ii) The Company has provided for the deferred tax based on the tax effect of timing differences, which will reverse in future. The break up is as under:

4) Sales Tax Deferment

Unsecured loan includes Interest free Sales Tax Deferment of Rs. 1,84,71,727/-. Out of this, a sum of Rs 7,49,146/- (P. Y. Rs 11,25,092/-) is due within the immediate next year. Rs.39,402/- is payable in next year as annual installments till year 2016-17.

5) Segment Reporting

The Company has only one reportable segment i.e. Cold drawn Seamless Pipes and Tubes. Hence requirement of Accounting Standard, AS-17 "Segment Reporting" are not applicable.

6) Impairment of Assets

There is no such impairment of assets at the year ended on 31.03.15 in terms of Accounting Standard, AS - 28. Hence company has not made any provision for impairment loss.

7) Dues to Micro, Small and Medium enterprises

The Company has not received any intimation from 'suppliers' regarding their status under the Micro, Small and Medium enterprises Development Act, 2006 and hence disclosures, if any relating to amount unpaid as at the year end together with interest paid/payable as required under the said Act have not been furnished.

A) Name of the Parties (as certified by the management)

1) Associates

* Madras Steel & Tubes

* Vinayak Pipes & Tubes Pvt Ltd

* Vinayak Tubes

* Excel Tube Corporation

2) Key Management Personnel

* Shri Madhav. P. Jalan

* Shri Vivek Jalan

* Shri Jiwanprakash. T. Hingorani

* Shri Chetan Jain

* Smt. Mala Sharma

* Chandrashekar R. Kulkarni

3) Relative of Key Management Personnel (KMP)

* Smt. Sampathidevi M. Jalan

8) In the opinion of Board the current assets, loans & advances are approximately'of the value stated in the balance sheet if realized in the ordinary courses of business.

9) Till the financial year 2013-14, the Company has charged depreciation as per rates provided under schedule XIV of Companies Act, 1956. With effective from 01st April, 2014, the Company has charged depreciation on its assets based on the useful life as stipulated under schedule II of Companies Act, 2013. Based on the transitional provision as provided in Note 7(b) of the Schedule II, Rs. 3,08,016/- (Net of Tax) has been adjusted against opening balance of retained earnings.

10) Trade Receivables, Trade Payables, Advance from Customers and Loans & Advances, the balances under these heads have been shown as per books of accounts and are subject to reconciliation and adjustment, if any.

11) Previous year's figures have been regrouped, wherever necessary to make them comparable with those of current year. Figures in the brackets represent figures for the previous year.

12) Previous year audit was conducted by auditors other than K C P L AND Associates LLP.


Mar 31, 2012

1) Contingent Liabilities

i) Counter Guarantee given to the Bank for the performance guarantee given by them of Rs.36.85 Lacs (P.Y. Rs.77.16 lacs).

ii) Disputed sales tax liability of Rs. 65, 57,957/ for F.Y 2004-05- (P.Y. Nil).

iii) Letters of Credit outstanding of Rs. 2, 93, 81,661 (P. Y. Nil).

iv) Disputed excise liability raised by the Central Excise Dept is as follows :

1. Disputed excise liability for the period Jan 2011 to Dec 2011 for Rs.13,11,717/-

2. Disputed excise liability for the period Aug 2009 to Dec 2009 for Rs.2,47,911/-

3. Disputed excise liability for the period Jan 2010 to May 2010 for Rs.3,67,760/-

4. Disputed excise liability for the period Jun 2010 to Dec 2010 for Rs.11,83,336/-

2) Income Tax

i) Due to net loss the company has not made any provision of Current Tax under the provisions of Income Tax Act, 1961.

3) Sales Tax Deferment

Unsecured loan represent Interest free Sales Tax Deferment of Rs. 2,11,65,919/-. Out of these, a sum of Rs 20,54,315/- (P. Y. Rs 21,07,017/-) is due within the immediate next year. Rs. 37,83,970/- is payable in next 4 years as annual installments till year 2016-17.

4) Segment Reporting

The Company has only one reportable segment i.e. Cold drawn Seamless Pipes and Tubes. Hence requirement of Accounting Standard, AS-17 "Segment Reporting" are not applicable.

5) Impairment of Assets

There is no such impairment of assets at the year ended on 31.03.12 in terms of Accounting Standard, AS - 28. Hence company has not made any provision for impairment loss.

6) Dues to Small Scale Industrial Undertakings

The Company has not received any intimation from ''suppliers'' regarding their status under the Micro, Small and Medium enterprises Development Act, 2006 and hence disclosures, if any relating to amount unpaid as at the yearend together with interest paid/payable as required under the said Act have not been furnished.

7) Related Party Disclosures as per Accounting Standard (AS) 18 :

A) Name of the Parties ( as certified by the management)

1) Associates

Madras Steel & Tubes (MST)

Riddi Siddhi & Co. (RSC)

Sarayu Issue Management Services Pvt. Ltd. (SIMSPL)

Vinayak Tubes (VT)

Vinayak Steels (VS)

Excel Tube Corporation (ETC)

2) Key Management Personnel

Shri Madhav. P. Jalan

Shri Vivek Jalan

Shri J. T. Hingorani

Shri Manish Dalai

Shri Chetan Jain

Smt. Mala Sharma

3) Relative of Key Management Personnel (KMP)

Shri Rishi Jalan

Smt. Sampathidevi M. Jalan

8) In the opinion of Board the current assets, loans & advances are approximately of the value stated in the balance sheet if realized in the ordinary courses of business.

9) Previous year''s figures have been regrouped, wherever necessary to make them comparable with those of current year. Figures in the brackets represent figures for the previous year


Mar 31, 2011

A) Contingent Liabilities

i) Counter Guarantee given to the Bank for the performance guarantee given by them of Rs. 77.16 lacs (P.Y. Rs.52.92 lacs).

ii) Disputed sales tax liability of Rs. Nil (P.Y. Rs. 161.93 Lacs ).

iii) Letter of Credit outstanding of Rs. Nil (P.Y. Rs. 568.82 Lacs).

iv) Estimated amount of contract remaining to be executed on Capital Account and not provided for Rs. 5.00 lacs (P.Y. Rs. 419.45 Lacs)

v) Disputed excise liability for the period August, 2009 to December,2010 raised by the Central Excise Dept. for Rs.17,99,007. »

c) Income Tax

i) The Company has made adequate provision of Current Tax Rs. Nil (P.Y. Rs. Nil/-) under the provisions of Income Tax Act, 1961.

d) Sales Tax Deferment

Unsecured loan represent Interest free Sales Tax Deferment of Rs. 2,32,72,936/- out of these, a sum of Rs 20,54,315/- (P. Y. Rs 13,97,276/-) is due within the immediate next year and Rs. 76,45,302/- is payable in next 5 yearly installments till year 2016-17.

Further Rs. 97,81,109/- (P.Y. Rs 55,46,525/-) is added in above unsecured loan as per sanction of the deferment scheme by the Sales Tax authorities.

b) Managerial Remuneration *

Directors Remuneration paid Rs 23,99,999/- (Previous Year Rs. 25,95,169/-).

c) Segment Reporting

The Company has only one reportable segment i.e. Cold drawn Seamless Pipes and Tubes. Hence requirement of Accounting Standard, AS-17 "Segment Reporting" are not applicable.

d) Impairment of Assets

There is no such impairment of assets at the year ended on 31.03.11 in terms of Accounting Standard, AS - 28. Hence company has not made any provision for impairment loss.

e) Dues to Small Scale Industrial Undertakings

The Company has not received any intimation from 'suppliers' regarding their status under the Micro, Small and Medium enterprises Development Act, 2006 and hence disclosures, if any relating to amount unpaid as at the year end together with interest paid/payable as required under the said Act have not been furnished.

f) Additional Information pursuant to clause 3,4C, 4D of Part II of Schedule VI of Companies Act, 1956.

g) In the opinion of Board the current assets, loans & advances are approximately of the value stated in the balance sheet if realized in the ordinary courses of business.

h) Previous years figures have been regrouped, wherever necessary to make them comparable with those of current year. Figures in the brackets represent figures for the previous year