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Maharaja Shree Umaid Mills Ltd. Notes to Accounts, Maharaja Shree Umaid Mills Ltd. Company
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Notes to Accounts of Maharaja Shree Umaid Mills Ltd.

Mar 31, 2015

1. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee's State Insurance Fund. The Company recognised Rs. 487.51 Lacs (previous year Rs. 356.97 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award.

The following table set out the disclosures relating to Gratuity and Leave Encashment benefits as required by Revised Accounting Standard (AS)-15 "Employee Benefits" :

2. The Employee Benefit Expense as per Note-23 includes excess managerial remuneration of Rs. 33.89 lacs paid to Mr. Swapan Nath, Executive Director & CEO. The Company will make an application to Central Government for waiver of this excess remuneration paid. Till the waiver is allowed by the Central Government, the Director will hold this money in trust and if Central Government doesn't allow the waiver, the Director will refund the excess remuneration paid.

3. Pursuant to the Companies Act, 2013 ('the Act") becoming effective from 1st April 2014, the Company has computed the depreciation for the year based on the remaining useful lives of the assets as per Schedule II to the Act. Based on the transitional provision, provided in note 7(b) of Schedule II of the Companies Act, 2013, the Company has transferred Rs. 17.23 lacs to reserves of the Company. Consequent to this change, the depreciation charged for the year 2014-15 is lower by Rs. 55.50 Lakhs.

4. Segment Reporting

The company has two main Business Segments viz Textiles & Wind Power Generation Units & the segmental numbers in terms of Accounting Standard (AS-17) has been accordingly reported in Consolidated Financial Statements.

5. Previous year figures have been regrouped and rearranged wherever necessary to conform to current year's grouping.


Mar 31, 2014

1. Scheme of Demerger

a. Pursuant to the Scheme of Arrangement ("the scheme") sanctioned by the Hon''ble High Court at Kolkata, vide its order dt. 21-08-2013, all the assets and liabilities of the investment division of Maharaja Shree Umaid Mills Limited have been transferred to and vested in Kiran Vyapar Limited at their respective book values on a going concern basis with effect from 01st April, 2012 being the appointed date.

As per the scheme, appointed date as approved by the Hon''ble High Court is 01st April, 2012 and the effective date is 24th September, 2013 being the date on which the certified copy of the order sanctioning the said scheme has been filed with the Registrar of Companies, Kolkata in accordance with the Companies Act, 1956.

b. The accounting of Assets & Liabilities transferred to Kiran Vyapar Limited has been done as per scheme sanctioned by Hon''ble High Court at Kolkata which provides vide Sub-clause (iii) of clause No. 1.2 of Part VI of the scheme as under:

"The Demerged Company shall make appropriate entries in accordance with the Accounting Standards i ssued by the Institute of Chartered Accountants of India and other normally accepted Accounting Principles wherever required otherwise than as provided in scheme."

Following the precedent set by jurisdiction High Court, accounting for demerger has been done as per "Pooling of Interest Method" as specified in AS-14 issued by ICAI.

Accordingly, while preparing the revised financial statements of the company, the assets & liabilities which are transferred to Kiran Vyapar Limited have been transferred at their existing book value. Revaluation Reserve and Capital Reserve relating to the assets which continued to be held with the Company has not been transferred to Kiran Vyapar Limited. General Reserve of Rs. 12,181.99 Lacs and Surplus in Profit & Loss Account amounting to Rs. 42,763.39 Lacs of the Company has been transferred to the Kiran Vyapar Limited and has been recorded in the company as detailed below:

The difference between the Assets & Liabilities transferred to Kiran Vyapar limited amounting to Rs. 54,945.38 lacs as per note no. 2(c) has been firstly debited to

(a) General Reserve amounting to Rs. 12,181.99 lacs

(b) Balance to Surplus in Profit & Loss Account amounting to Rs. 42,763.39 lacs above in Note No. 31(a) and consequently the assets & liabilities of previous year as at 31st March 2013, have been restated to exclude the assets & liabilities of the investment division as at 31st March 2013 and figures in the Profit & Loss account exclude the results of operations of the Investment divisions for the period 1st April 2012 to 31st March 2013 and therefore the previous year numbers are restated and are not as per the numbers approved by the shareholders.

f. As part of the Demerger Scheme of erstwhile Investment Division which was approved by Honourable High Court of Kolkata , company''s investment in Iota Mtech Pvt limited was transferred to Kiran Vyapar Limited & consequently Iota Mtech Pvt limited ceases to be a subsidary of the company.

2. Contingent Liabilities and Commitments

As at As at

(i) Contingent Liabilities March 31st, 2014 March 31st, 2014 (Rs. in lacs) (Rs. in lacs)

a. Bank Guarantees outstanding 191.09 173.46

b. Claims against the Company (in dispute) not acknowledged as debts in respect of:

(i) Labour & Industrial Matters 49.78 10.03

(ii) Income-tax matters 1294.15 161.32

(iii) Entry Tax matters 16.26 16.26

(iv) Service Tax matters 90.78 90.78

(v) Electricity Duty& other cess, etc 755.92 -

(vi) VAT matters 9.67 -

All the above matters when concluded are unlikely, in the opinion of the management, to result in any material liability and consequent effect on the results of operations and/or financial position of the Company.

*Note :Taxes amounting to Rs.1132 lacs (included above) is disputed before the appropriate authorities. Out of this amount of Rs 1132 lacs, Rs 685 Lacs pertains to erstwhile Investment Division since demerged & forms part of Kiran Vyapar Limited. In the event the final outcome of the same is adverse and required to be paid, in accordance with the Scheme sanctioned by the Hon''ble High Court of Kolkata, the same will be recoverable from Kiran Vyapar Limited.

3. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee''s State Insurance Fund. The Company recognised Rs.356.97 Lacs (previous year Rs. 309.08 Lacs) during the year as expense towards contribution to these plans.

4. Segment Reporting

The company has two main Business Segments viz Textiles & Wind Power Generation Units & the segmental numbers in terms of Accounting Standard (AS-17) has been accordingly reported in Consolidated Financial Statements .

Consequent to demerger of erstwhile Investment division, as per Honourable High Court of Kolkata which was given effect on 24th September 2013 & effective 1st April 2012, there are no segmental numbers applicable to Investment.

5. During the year, Export Incentives like Duty Drawback, Focus Market Scheme, etc. were recognized as revenue on post export accrual basis instead of on cash basis. Going by past experience such export incentives have fair amount of certainty of its realisation & hence this change. Had this change not been effected during the year Net Sales / income from operations would have been lower by Rs 100.74 lacs consequently.


Mar 31, 2013

1. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee''s State Insurance Fund. The Company recognised Rs.310.08 Lacs (previous year Rs. 285.67 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award.

The following table set out the disclosures relating to Gratuity and Leave Encashment benefits as required by Revised Accounting Standard (AS)-15 "Employee Benefits" :

2. Segment Reporting

As per Accounting Standard (AS)-17 on ‘Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.

3. The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February, 2011 and 21st February, 2011 respectively, has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the condition stipulated in the circular and hence is entitled to the exemption. Necessary information relating to subsidiaries has been included in the Consolidated Financial Statements.

4. Previous year figures have been regrouped and rearranged wherever necessary to conform to current year''s grouping.


Mar 31, 2012

Notes :

1. Term loans are secured by first pari passu charge on the entire fixed assets and second charge on the current assets of the Pali Establishment Unit i.e.the Textile Unit and the Power Generation Unit of the company situated at Pali, including equitable mortgage of Factory Land & Building situated at Pali.

2. Terms of repayment are given below:

a) Loan taken from State Bank of India is repayable in quarterly installments of Rs. 130.00 Lacs each.

b) Loan taken from IDBI Bank Ltd. is repayable in quarterly installments of Rs. 134.38 Lacs each.

c) Loan taken from ICICI Bank Ltd. is repayable in quarterly installments of Rs. 62.50 Lacs each.

d) Loan taken from State Bank of Bikaner & Jaipur is repayable in quarterly installments of Rs. 375.00 Lacs commencing from 30.06.2013.

Notes :

Working Capital Loans are secured by first pari passu charge on present and future stock of raw materials, stock-in-process, finished goods, stores and spares, book debts, etc., and second pari passu charge on the Fixed Assets of the Pali Establishment i.e. the Textile Unit and the Power Generation Unit of the company situated at Pali.

Note :

Out of the above amount , Rs. 9.15 Lacs (March 31, 2011: 14.10 Lacs) pertain to the Micro, Small and Medium Enterprises (MSME) as defined under " Micro, Small and Medium Enterprises Development Act, 2006" based on the information available with the Company. There is no interest payable to such parties as at March 31, 2012 (March 31, 2011 : Rs. NIL )

1. Contingent Liabilities and Commitments As at As at March 31, 2012 March 31, 2011

(i) Contingent Liabilities

a. Letters of credit outstanding 3898.08 -

b. Claims against the Company (in dispute) not acknowledged as debts in respect of:

(i) Labour & Industrial Matters 10.03 9.94

(ii) Income-tax matters 161.32 161.32

(iii) Entry Tax matters 16.26 16.26

(iv) Service Tax matters 90.78 90.78

All the above matters when concluded are unlikely, in the opinion of the management, to result in any material liability and consequent effect on the results of operations and/or financial position of the Company.

(ii) Commitments

a. Estimated amount of contracts on Capital Accounts remaining to be executed and not provided for (net of advances) 6032.60 1136.07

b. The Company has export obligations of Rs. 1257.81 Lacs (USD 24.72 Lacs) [Previous Year: Rs. 434.23 Lacs) against Import Licences taken for import of capital goods under Export Promotion Capital Goods (EPCG) Scheme.

c. With respect to the divestment of the shares in The Andhra Pradesh Paper Mills Limited during the year, under the Share Purchase Agreement (SP Agreement) and Indemnity Escrow Agreement between all the sellers including the Company, IP Holding Asia Singapore Pte. Ltd. and International Paper Company, the sellers, including the Company, have agreed to indemnify and hold free and harmless to IP Holding Asia Singapore Pte. Ltd. and International Paper Company from losses incurred or suffered in terms of indemnification clause(s) of the said SP Agreement and Indemnity Escrow Agreement. Further, as per the aforesaid agreements, term deposits with Citi Bank have been made for an amount of Rs. 28,34,63,000/-.

2. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employee's State Insurance Fund. The Company recognised Rs.285.64 Lacs (previous year Rs. 264.06 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award.

The following table set out the disclosures relating to Gratuity and Leave Encashment benefits as required by Revised Accounting Standard (AS)-15 "Employee Benefits" :

3. Employee benefit expense (Note # 25) excludes remuneration paid to the Chairman & Managing Director in excess of the limits specified under Schedule XIII to the Companies Act, 1956 to the tune of Rs. 8.86 Lacs. The Company has made an application seeking approval from the Central Government. The payment and provision would be made after obtaining approval of the competent authority.

4. Extraordinary Items

During the year, the Company disposed off its entire shareholding (8609164 shares) in the equity of The Andhra Pradesh Paper Mills Ltd. on 14.10.2011 for a consideration of Rs.523.00 per share plus a non- compete fees of Rs. 130.74 per share aggregating Rs.56282 Lacs pursuant to the agreement entered with IP Holding Asia Singapore PTE, an affiliate of International Paper Company, USA on 29.03.2011.

The Kota Establishment was closed u/s 25(O) of the Industrial Disputes Act, 1947 on 06.03.1985. Pursuant to the settlement arrived at with the respondent trade unions, the Supreme Court of India has upheld the decision of the closure of establishment and the Company has agreed to pay an amount of Rs.70.36 Lacs as closure compensation and ex-gratia to certain eligible workers employed at the establishment on the date of closure, i.e. 06.03.1985.

5. Segment Reporting

As per Accounting Standard (AS)-17 on 'Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.

6. The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated 8th February 2011 and 21st February 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the condition stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

7. Previous year figures have been regrouped and rearranged wherever necessary to conform to current year's grouping.


Mar 31, 2011

2010-11 2009-10

(Rs. in Lacs )

1. Other Contingent Liabilities, provision where of is considered not necessary:

(i) Claims against the Company regarding Labour Claims etc. 9.94 10.78

(ii) Claims against the Company regarding Incometax assestsment for 161.32 161.32 different years (net of provisions / actual payments)

(iii) Claims against the Company regarding Entry Tax liabilities (net of 16.26 148.15 provisions / acual paymens)

(iv) Claims against the Company regarding Excise Duty and Service Tax 90.78 260.36 assestsment for different years (net of provisions / actual payments)

All the above mtaers when concluded, are unlikely, in the opinion of the management, to result in any material liability and consequent effect on the results of operations and/or financial position of the Company.

2. The Company has export obligations of Rs. 434.23 Lacs (USD 9.78 Lacs) [Previous Year: Rs. 3881.09 Lacs) against Import Licences taken for import of capital goods under export Promotion Capital Goods Scheme.

3. Fixed Assets

The land has been shown a the revalued figure amounting to Rs.6,660.61 lacs as agains the original cost of Rs. 4.47 lacs on the basis of the Valuation report dated 12.03.2009 of an approved valuer.

4. Investments

During the year, the Company along with is affiliates has entered in to an agreement dated 29.03.2011, for sale of is entire shareholdings in The Andhra Pradesh Paper Mills to IP Holding Asia Singapore PTE. LTD., an affiliate of Inernational Paper Company, USA. The sale is subject to receip of requisite approvals and subject to fulfillment of certain agreed conditions precedent. The sale of the aforesaid shares will take place only after receiving the necessary approvals from the regulaory authories and Account for accordingly.

An amount of Rs. 155.77 lacs had been provided towards nontemporary diminution in the value of shares of The Peria Karamalai Tea & Produce Company Ld. before 2006. with improved performance of the company and market prices being consisenly above he purchase price, the provision of Rs. 155.77 lacs is no longer considered necessary, hence, written back.

5. There are no Micro and Small Enerprises to whom the Company owes dues, which are outsanding for more than 45 days as a March 31, 2011. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) has been determined to the exent such parties have been identified on the basis of information available with the Company.

6. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Conribution Plan for is employees comprising of Provident Fund, Superannuation Fund, Pension and Employee's state Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund rus equal to specified percenage of the covered employees' salary. The Company recognised Rs. 264.06 Lacs (previous year Rs. 228.33 Lacs) during the year as expense towards contribution to these plans.

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Grauity Fund, Leave Encashment and Long term Service Award. The Company contributes to the Grauity Fund, which is recognised by the Income Tax Auhoriies and adminisered horough is rusees. The liabiliy for Grauiy and Leave Encashment is determined on the basis of an independent acuarial valuation done a the yeartend. The acuarial valuation method used for measuring the liability is the Projected Unit Credit method.

7. exceptional Incomes/non-operating Incomes

During the year, the Company disposed off its property at Jaipur for Rs. 15,650 lacs (net realization).

The Company has received an amount of Rs 1,825.09 lacs pursuant to an exclusivity agreement dated 11.1.2011 entered into in relation to its investments in The Andhra Pradesh Paper Mills Ltd. as referred to in note no. 7 given above regarding investments.

During the year, the Company invested and disposed off its holding in Zandu Realty Limited and incurred a loss of Rs 353 lacs.

The Company has contested certain government levies related to statutory duties, taxes and other obligations imposed under different statutes. Pending the final disposal of the cases at appropriate level, as a matter of abundant caution, the demand / likely liability has been provided for by the Company in the financial statements for Rs 1,719.63 lacs.

8. Segment reporting

The Company has been deriving is revenues significantly from exile manufacturing processes, being a composie exile mill. Besides his, here has been a subsanial increase in the Investment Activity and volume subsequen to the sale of land of the Company a Jaipur. The funds deployed in Investment Activities have significantly different se of risks and rewards as compared to the exile business and as such as per ASt17, the new segment is styled as "Investment Division" w.e.f. 1s February 2011 pursuant to the Board Resolution.

Figures of the previous year have been reported hereinunder for the comparison purpose only.

9. Previous year figures have been regrouped and rearranged wherever necessary to conform to current year's grouping.


Mar 31, 2010

2009-10 2008-09 (Rs. in Lacs)

1. Estimated amount of contracts on Capital Accounts remaining to be executed 1367.27 1263.44 and not provided for (net of advances)

2.Other Contingent Liabilities, provision whereof is considered not necessary:

(i) Claims against the Company regarding Labour Claims etc. 10.78 11.19

(ii) Claims against the Company regarding Income-tax Assessment for 161.32 161.32 different years (net of provisions / actual payments)

(iii) Claims against the Company regarding Entry Tax liabilities (net of 148.15 125.63 provisions / actual payments)

(iv) Claims against the Company regarding Excise Duty and Service Tax 260.36 169.58

Assessment for different years (net of provisions / actual payments)

All the above matters when concluded, are unlikely, in the opinion of the management, to result in any material liability and consequent effect on the results of operations and/or financial position of the Company.

3. The Company has export obligations of Rs. 3881.09 Lacs (USD 86.29 Lacs) [Previous Year. Rs. 1369.60 Lacs) against Import Licences taken for import of capital goods under Export Promotion Capital Goods Scheme.

4. Fixed Assets

The land has been shown at the revalued figure amounting to Rs.6,660.61 lacs as against the original cost of Rs. 4.47 lacs on the basis of the Valuation Report dated 12.03.2009 of an approved valuer.

5. Investments

Investments made in the Equity shares of Dunbar Mills Ltd. (Rs. 37.09 lacs) and in the Preference shares of The Fort William Industries Ltd. (Rs. 11.51 lacs) have been removed from investments and adjusted against Stock & Investment (Diminution/Fluctuation in Value) Reserve, created out of profits appropriated in past for the specific purpose. The captioned companies have been liquidated with no payments distributed to the shareholders.

In past, there had been a fall in the value of investment in shares in the Peria Karamalai Tea & Produce Co. Ltd., appearing in the books at Rs. 177.03 lacs as on 31.03.2006. As such the sum of Rs. 155.77 lacs, then representing the fall had been provided for in the provision for diminution. However, as the investments in the three Companies, viz. i) The Peria Karamalai Tea & Produce Co. Ltd.; ii) The Andhra Pradesh Paper Mills Ltd.; and iii) Digvijay Investments Ltd., are long term and strategic, made out of reserves of the Company, the fluctuations in the values thereof are considered to be of temporary nature, hence no change in the provision for diminution, if any at the end of the year, is considered necessary.

6. There are no Micro and Small Enterprises to whom the Company owes dues, which are outstanding for more than 45 days as at March 31, 2010. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) has been determined to the extent such parties have been identified on the basis of information available with the Company.

7. Employee Benefits

(a) Defined Contribution Plans

The Company has Defined Contribution Plan for its employees comprising of Provident Fund, Superannuation Fund, Pension and Employees State Insurance Fund. The Company and eligible employees make monthly contribution to the Provident Fund trust equal to specified percentage of the covered employees salary. The

(b) Defined Benefit Plans

The Company has Defined Benefit Plan comprising of Gratuity Fund, Leave Encashment and Long Term Service Award. The Company contributes to the Gratuity Fund, which is recognised by the Income Tax Authorities and administered thorough its trustees. The liability for Gratuity and Leave Encashment is determined on the basis of an independent actuarial valuation done at the year-end. The actuarial valuation method used for measuring the liability is the Projected Unit Credit method.

8. Related party Disclosures:

A. Names of related parties and description of relationship :

S. Key Management Relatives of Subsidiaries No. Personnel (KMP) Key Management Personnel (KMP)

i. Mr. LN Bangur Mr. Yogesh Bangur Allied CMD President (CA&S) Dealcomm Ltd.

ii. Mr. Govind Sharda ED

iii.

iv.

v.

Key Management Significant Influence Personnel

i. Mr. LN Bangur The Andhra Pradesh Paper CMD Mills Ltd.

ii.Mr. Govind Sharda The Peria Karamalai Tea & ED Produce Co. Ltd.

iii. Digvijay Investments Ltd.

Swadeshi Commercial Co. Ltd. iv. Shree Rama Vaikunth Temple

v.



9. The Companys business activity (i.e. Textiles) falls within a single primary business segment; and as such the disclosure requirements of the Accounting Standard (AS-17) on Segment Reporting, issued by the Institute of Chartered Accountants of India, in this regard is getting met.

 
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