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Notes to Accounts of MIC Electronics Ltd.

Mar 31, 2016

The Company has only one class of equity shares having a par value of Rs. 2/- per share. Each Shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding.

During the financial year the company has converted 47,214,848 share warrants into equity shares of Rs.2/- each with a premium of Rs.1/- each.

During the financial year the company has allotted 30,000,000 convertible share warrants to Leyard Honking Co Ltd on 15.02.16, each of which is convertible into 1 equity share of Rs. 2/- each at a premium of Rs.23/- each. Out of which the company has received Rs.189,112,000/- as share warrants application money and the balance amount to be received within 18 months on conversion into equity shares.

During the financial year the company has allotted 3,000,000 convertible share warrants to Shri Pujitha Kamineni on

15.02.16, each of which is convertible into 1 equity share of Rs. 2/- each at a premium of Rs.23/- each. Out of which the company has received Rs.18,750,000/- as share warrants application money and the balance amount to be received within 18 months on conversion into equity shares.

(*) Current portion of Long-term liabilities shown under other current liabilities

a) Term Loan taken from UCO Bank is secured as follows:

Primary Security: (i) 1st hypothecation charge over the plant and machinery, LED Display boards, software and other fixed assets of the project at 8 Delhi Metro Railway Stations (DMRC). (ii) 1st charge on receivables arising out of the DMRC project. Collateral Security: Second charge on the fixed assets of the company other than what has been taken as first charge. UCO Bank is further secured by personal guarantee of the Managing Director of the company. Term Loan is repayable in 20 quarterly installments of Rs.40.62 Lakhs each at variable interest rate of 15.75% commencing from December 2012.

b) Term Loan taken from Technology Development Board of Rs.1500 Lakhs is secured as follows:

(i) first charge on entire fixed assets, present and future, of the company by way of hypothecation and mortgage in favour of TDB ranking pari passu with other charge- holders (Banks/FIs). (ii) Personal guarantees of Managing Director & Executive Director of the Company. (iii) Pledge of 37.50 Lakh shares held by promoter. Term loan is repayable in 9 half yearly installments at fixed interest rate of 5% p.a. - First installment of Rs.160.00 lakhs & remaining 8 installments @ Rs.167.50 lakhs each commencing from 01.01.2013.

c) Term Loan taken from L&T Finance Limited is secured as follows:

(i) Hypothecation of charge over 19 LED Display Boards, (ii) Personal Guarantee of Managing Director of the Company. (iii) The Honourable High Court for the state of Telangana by its order dated 23.07.2014 approved the settlement reached between MIC Electronics Limited and L&T Finance Ltd. As per the settlement MIC has agreed to pay the outstanding debt of Rs.11.91 crores in 36 monthly installments starting from 05.09.2014 out of which the company has paid 1st installment of Rs.33.07 lakhs on 05.09.2014. As on 31.03.16 the total loan outstanding is Rs.11.58 crores.

d) Term Loan taken from Srei Equipment Finance Pvt Ltd is secured as follows:

(i) Hypothecation of equipments, fixtures etc. valued Rs.28.20 crore (ii) Mortgage of Land & building situated at 192/B, Phase II, IDA Cherlapally belonging to company. (iii) Personal Guarantee of the Managing Director of the company. (iv) Term Loan - I of Rs.1000.00 lakhs is repayable in 18 quarterly EMIs of Rs.78.29 lakhs each (including interest) at a variable interest rate of 15.50% commencing from 15.01.2012 (v) Term Loan - II of Rs.1400.00 lakhs is repayable in 18 quarterly EMIs of Rs.109.60 lakhs each (including interest) at a variable interest rate of 15.50% commencing from 15.02.2012.

e) Loans taken against purchase of vehicles are secured by hypothecation of the respective vehicles.

f) Financial contribution from Energy Efficiency Services Limited :

MIC Electronics Limited (MIC) has entered a joint implementation agreement with Energy Effficiency Services Ltd (EESL) for joint implementation of order received from Nashik Municipal Corporation (NMC) for supply and maintenance of LED Luminaries. As per the agreement EESL shall extend financial contribution of Rs.39.93 crores payable in monthly installments during the project period based on achievement of specified mile stones of the project. The first installment shall be due after 30 days from the issue of "Implementation Completion Certificate" by NMC in favour of MIC on completion of installation of LED Lights. As on date EESL has made a financial contribution of Rs.11.19 crores.

Note : . The working capital loan from SBI has become NPA from 28.11.2014. During the year, the company has not provided interest on working capital loan from SBI for Rs.11.87 Crores (Previous Year Rs. 7.21 crores) in the books.

i) State Bank of India working capital limits including buyers credit are secured by :

a) Primary Security: First Charge (hyp) on all current assets of the company.

b) Collateral Security: (i) Pari-passu charge on entire fixed assets with TDB excluding fixed assets funded by UCO Bank and vehicle HP loans. (ii) Second charge on EM of industrial plot situated at Plot No.192/B in Sy.No.274 admeasuring 5341 Sq.Yards situated at phase II, IDA, Cherlapally village, Kapra Municipality Ghatkesar Mandal RR District & Second charge on fixed assets created out of term loan from UCO Bank.

c) SBI is further secured by personal guarantees of Managing Director & Executive Director of the company.

ii) Andhra Bank working capital (non fund based) limits of Rs.4.66 Crores are secured by :

Exclusive charge on current assets of LED Lighting Division of the company (ii) 1st charge on fixed assets (excluding assets financed by UCO Bank & Srei Equipment Finance Pvt Ltd) of the company ranking pari-passu with SBI (iii) Counter Guarantee of the company.

(i) In the opinion of the management the Trade Receivables, Current Assets, Loans and Advances are expected to realize the amount at which they are stated and provision for all known liabilities have been adequately made in the accounts.

(ii) The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties

NOTE- 1

Related party disclosures :

In Accordance with the Accounting standard AS-18 “Related Party disclosures” Issued by the ICAI, the transactions with related parties are given below:

NOTE - 2

Disclosure in respect of operating lease:

i) A general description of leasing arrangements : Leasing arrangement for LED Display Systems

ii) Lease payment recognized in the statement of Profit & Loss Account for the year: Rs.Nil (Previous year- Rs.Nil)

iii) lease amounts not recognized during the year : First Leasing Company of India Ltd transferred the lease rentals receivables from MIC Electronics Ltd to Reliance Capital Ltd As per the agreement, lease rentals are payable in 59 monthly installments to Reliance Capital Ltd and the last installment is due in Dec''14. MIC Electronics Ltd received a notice from Reliance Capital Ltd on 20.01.2012 about the loan agreement termination for delay in payment of lease rentals. Subsequently First Leasing Company stopped billing lease rentals w.e.f 01.04.2012. Hence MIC Electronics Ltd stopped recognizing lease rentals in the books from 01.04.2012. The unrecognized lease rentals from Apr''15 to Mar''16 is Rs.Nil (Total unrecognized lease rentals upto 31.03.16 is Rs.17.31 crores)

In accordance with the AS-22 ''Accounting for taxes on Income issued by the Institute of Chartered Accountants of India , during the current year the company has accounted for the effect of deferred Tax against the income pertaining to current year and has accordingly provided for deferred tax asset of Rs.459,753,830 (Previous Year Rs.16,793,867/-) on account of current year''s deferred tax.

(i) The company has incurred one time expenditure of Rs.9,331,130/- during the Year 2010-11 towards DMRC project finance which is being amortized over a period of 5 years . During the period an amount of Rs.1,866,231/- (Previous year Rs.1,866,224/-) has been amortized

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

Figures have been rounded off to nearest rupee. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.


Mar 31, 2015

NOTE - 1.

Disclosure in respect of operating lease:

i) A general description of leasing arrangements : Leasing arrangement for LED Display Systems

ii) Lease payment recognized in the statement of Profit & Loss Account for the year: Rs.Nil (Previous year- Rs.Nil)

iii) lease amounts not recognised during the year : First Leasing Company of India Ltd transferred the lease rentals receivables from MIC Electronics Ltd to Reliance Capital Ltd. As per the agreement, lease rentals are payable in 59 monthly instalments to Reliance Capital Ltd and the last instalment is due in Dec'14. MIC Electronics Ltd received a notice from Reliance Capital Ltd on 20.01.2012 about the loan agreement termination for delay in payment of lease rentals. Subsequently First Leasing Company stopped billing lease rentals w.e.f 01.04.2012. Hence MIC Electronics Ltd stopped recognizing lease rentals in the books from 01.04.2012. The unrecognized lease rentals from Apr'14 to Mar'15 amount to Rs 47,196,000/-.(Total unrecognised lease rentals upto 31.03.15 is Rs.17.31 crores)

NOTE - 2.

In accordance with the AS-22 'Accounting for taxes on Income issued by the Institute of Chartered Accountants of India , during the current year the company has accounted for the effect of deferred Tax against the income pertaining to current year and has accordingly provided for deferred tax asset of Rs.16,793,867/- (Previous Year Rs.118,622,330/- deferred tax asset) on account of current year's deferred tax.

NOTE -3.

(i) The company has incurred one time expenditure of Rs.16,361,609/- during the Year 2009-10 towards leased assets which is being amortised over a period of 5 years ending with March 2015. During the year an amount of Rs.2,726,942/- (Previous year Rs.2,454,240/-) has been amortised.

(ii) The company has incurred one time expenditure of Rs.9,331,130/- during the Year 2010-11 towards DMRC project finance which is being amortised over a period of 5 years . During the period an amount of Rs.1,866,224/- (Previous year Rs.1,399,668/-) has been amortised.

NOTE - 4.

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

NOTE - 5.

Figures have been rounded off to nearest rupee. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure. Also previous year figures are not comparable since they represent only 9 months where as current year represent 12 months.


Mar 31, 2014

1. Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those followed in the previous years.

NOTE- 2

(i) In the opinion of the management the Trade Receivables, Current Assets, Loans and Advances are expected to realise the amount at which they are stated and provision for all known liabilities have been adequately made in the accounts.

(ii) The balances of trade receivables, trade payables, long term loans & advances, short term loans & advances, other current assets & other current liabilities are subject to confirmation from respective parties

NOTE- 3

Contingent Liabilities : The following contingent liabilities are not provided for

(Amount in Rs.) Sl Particulars As at 31st As at 30th No. March 2014 June, 2013

1 Counter guarantees given by the 41,076,799 60,857,283 company to banks towards issue of B.Gs.

2 Counter guarantees given by the 7,096,982 7,096,982 company to banks towards issue of B.Gs to Customs & Central Excise Dept.

3 Bonds executed to Customs & 82,300,000 82,300,000 Central Excise Dept. (net of BGs)

4 Letter of credits issued by - 32,346,929 bankers

5 Corporate Guarantees given 70,000,000 70,000,000 by the company to banks on behalf of subsidiaries & associates

6 Claims against the company , 1,014,767,760 1,014,924,475 not acknowledged:

TAX Matters in Appeals

1 Excise Duty 3,896,982 3,896,982

2 Customs Duty 1,801,111 1,801,111

3 Sales Tax 5,302,831 5,302,831

NOTE - 4

Segment Information : The company is operating only in one segment i.e, LED based products and hence no segmental reporting is made.

NOTE - 5

Disclosure in respect of operating lease:

i) A general description of leasing arrangements : Leasing arrangement for LED Display Systems

ii) Lease payment recognized in the statement of Profit & Loss Account for the year: Rs.Nil (Previous year-Rs.Nil)

iii) lease amounts not recognised during the year : First Leasing Company of India Ltd transferred the lease rentals receivables from MIC Electronics Ltd to Reliance Capital Ltd MIC Electronics Ltd received a notice from Reliance Capital Ltd on 20.01.2012 about the loan agreement termination for delay in payment of lease rentals. Subsequently First Leasing Company stopped billing lease rentals w.e.f 01.04.2012. Hence MIC Electronics Ltd stopped recognizing lease rentals in the books from 01.04.2012. The unrecognized lease rentals from Jul''13 to Mar''14 amount to Rs 47,196,000/-.(previous year - Rs.47,196,000/-)

NOTE - 6

In accordance with the AS-22 ''Accounting for taxes on Income issued by the Institute of Chartered Accountants of India , during the current year the company has accounted for the effect of deferred Tax against the income pertaining to current year and has accordingly provided for deferred tax asset of Rs.118,622,330/-(Previous Year Rs.73,878,792/ - deferred tax liability) on account of current year''s deferred tax.

NOTE - 7

(i) The company has incurred one time expenditure of Rs.16,361,609/- during the Year 2009-10 towards leased assets which is being amortised over a period of 5 years. During the year an amount of Rs.2,454,240/ - (Previous year Rs.2,454,240/-) has been amortised

(ii) The company has incurred one time expenditure of Rs.9,331,130/- during the Year 2010-11 towards DMRC project finance which is being amortised over a period of 5 years . During the period an amount of Rs.1,399,668/- (Previous year Rs.1,399,668/-) has been amortised

NOTE - 8

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

NOTE - 9

Figures have been rounded off to nearest rupee. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the current year''s classification / disclosure.


Jun 30, 2013

1 Basis of accounting and preparation of financial statements

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles in India (Indian GAAP) to comply with the Accounting Standards notified under the Companies (Accounting Standards) Rules, 2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on accrual basis under the historical cost convention. The accounting policies adopted in the preparation of the financial statements are consistent with those fol lowed in the previous years.

NOTE-2.1

Segment Information: The company is operating only in one segment i.e, LED based products and hence no segmental reporting is made.

NOTE-2.2

Related party disclosures:

In Accordance with the Accounting standard AS-18" Related Party disclosures" Issued by the ICAI, the transactions with related parties are given below:

NOTE- 2.3

Disclosure in respect of operating lease:

i) Ageneral description of leasing arrangements : Leasing arrangement for LED Display Systems

ii) Lease payment recognized in the statement of Profit & Loss Account for the year: Rs.Nil (Previous year-Rs.55,258,646/-)

iii) lease amounts not recognised during the year : First Leasing Company of India Ltd transferred the lease rentals receivables from MIC Electronics Ltd to Reliance Capital Ltd. MIC Electronics Ltd received a notice from Reliance Capital Ltd on 20.01.2012 about the loan agreement termination for delay in payment of lease rentals. Subsequently First Leasing Company stopped billing lease rentals w.e.f 01.04.2012. Hence MIC Electronics Ltd stopped recognizing lease rentals in the books from 01.04.2012. The unrecognized lease rentals from Oct''12 to Jun''13 amount to Rs 47,196,000/-.(previous year - Rs.31,464,000/-)

NOTE-2.4

In accordance with the AS-22 ''Accounting for taxes on Income issued by the Institute of Chartered Accountants of India, during the current year the company has accounted for the effect of deferred Tax against the income pertaining to current year and has accordingly provided for deferred tax liability of Rs.73,878,792/-on account of current year''s deferred tax.

NOTE-2.5

(I) The company has incurred one time expenditure of Rs.16,361,609/- during the Year 2009-10 towards leased assets which is being amortised over a period of 5 years. During the year an amount of Rs.2,454,240/- (Previous year Rs.4,090,400/-) has been amortised.

(ii) The company has incurred one time expenditure of Rs.9,331,130/- during the Year 2010-11 towards DMRC project finance which is being amortised over a period of 5 years. During the period an amount of Rs.1,399,668/-(Previous year Rs.2,799,339/-) has been amortised.

NOTE-2.6

Disclosure of Sundry Creditors under Trade Payables is based on the information available with the Company regarding the status of the suppliers as defined under the "Micro, Small and Medium Enterprises Development Act, 2006" and relied upon by the Auditors. As per the records with the company, none of the enterprises have been identified as Micro, Small and Medium Enterprises.

NOTE-2.7

Figures have been rounded off to nearest rupee. Previous year''s figures have been regrouped/reclassified wherever necessary to correspond with the current year''s classification/disclosure.


Jun 30, 2010

1. Contingent liabilities not provided for on account of :

(Amount in Rs.)

S No. Particulars As at 30.06.2010 As at 30.06.2009

A Counter guarantees given by the company to banks towards issue of B.Gs. 243,596,495 100,522,738

B Counter guarantees given by the company to banks towards issue of B.Gs to Customs & Central Excise Dept. 4,039,656 1,098,855

C Bonds executed to Customs & Central Excise Dept. (net of BGs)61,180,889 2,759,930

D Letter of credits issued by bankers 73,835,440 33,926,707

E Corporate Guarantees given by the company to banks on behalf of subsidiaries & associates 127,000,000 1,31,000,000

TAX Matters in Appeals

A Excise Duty 32,817,443 21,223,061

B Customs Duty 1,801,111 1,801,111

C Sales Tax 3,195,527 3,195,527

2. Loans:

Working Capital Loans:

Loans from State Bank of India are secured by pari passu charge on fixed assets and all chargeable current assets of the Company except assets pertaining to Technology

Development Board, National Research Development Corporation, IDBI and UCO Bank.

State Bank of India is further secured by second charge on the assets financed by IDBI and UCO Bank.

SBI is further secured by personal guarantees of three of the following Directors of the company.

1. Dr. M V Ramana Rao

2. Mr. L N Malleswara Rao

3. Mr. N Srinivasa Rao

Outstanding under Non fund based limits from Development credit bank is secured by counter guarantee given by State Bank of India.

Non fund based limits of Rs.10.00 crores from UCO Bank are secured by hypothecation of all chargeable current assets of the company ranking pari passu with SBI. 2nd charge on fixed assets held by SBI (excluding those assets which are funded by IDBI, UCO & TDB). Extension of 1st charge on fixed assets reated out of term loan from UCO Bank of Rs.30.00 crores.

Non fund based limits of Rs.20.00 crores from Andhra Bank are secured by 1st paripassu charge on all chargeable current assets of the company with SBI & UCO Bank and further secured by 2nd paripasu charge on fixed assets of the company with SBI, UCO Bank and IDBI.

Term Loans:

a) Outstanding term Loan of Rs.44.44 lacs (sanction limit of Rs.400 lacs) from Technology Development Board is secured by all assets pertaining to the development and commercialization of the LED TV / Electronic Display system project along with personal guarantee of Dr.M.V.Ramana Rao, Managing Director.

Outstanding term Loan of Rs.500.00 lacs (sanction limit of Rs.1500 lacs) from Technology Development Board is secured by first charge on entire fixed assets, present and future, of the company by way of hypothecation and mortgage in favour of TDB ranking pari passu with other charge-holders (banks / FIs).

b) From National Research Development Corporation is secured by all the machinery and equipments acquired for the development of “Fraud Management and Control Centre (FMCC)”.

c) Term Loan taken from IDBI is secured as follows :

Primary : (i) a first mortgage and charge on Industrial Plot No.192/B in Survey No.274 admeasuring 5341 Sq.Yards situated at Phase II, IDA, Cherlapally village, Kapra Municipality, Ghatkesar Mandal, RR District valued at Rs.2.50 Crores and proposed building thereon admeasuring 100000 Sq.Ft valued at Rs.12.52 Crores (Approx).

(ii) A first hypothecation charge on plant and machinery valued Rs. 6.89 Crores.

Collateral : NIL

Personal Guarantee : An irrevocable and unconditional guarantee from Dr.M.V.Ramana Rao in favour of IDBI

d) Term Loan taken from UCO Bank is secured as follows :

Primary : (i) 1st hypothecation charge over the plant and machinery, LED Display Boards, software and other fixed assets of the project of the company at DMRC. (ii) 1st Charge on receivables arising out of the DMRC Project.

Collateral Security : Second charge on the fixed assets of the company other than what has been taken as first charge. The first charge will be with SBI and DCB. UCO Bank is further secured by personal guarantee of Dr.M.V.Ramana Rao, Managing Director.

e) Loans taken against purchase of vehicles are secured by hypothecation of the respective vehicles.

6. Related party Disclosures:

In Accordance with the Accounting standard AS-18 " Related Party disclosures" Issued by the ICAI, the transactions with related parties are given below: a. List of Related Parties with whom transactions have taken place and Relationship :

S No. Name of the Related Party Relationship

1 M/s. MIC Technologies Australia (Pty) Ltd

2 M/s. Infostep Inc., USA

3 M/s. MIC Electronics Inc., USA Subsidiary Companies

4 M/s. Maave Electronics Pvt Ltd

5 M/s. MIC Green Energy Solutions Pvt Ltd

6 M/s. Virtual Energy Pvt Ltd Associate Company

7 Dr. M.V.Ramana Rao

8 Shri N.Srinivasa Rao

9 Shri Y.Harish Chandra Prasad

10 Shri Shrikant P Joshi

11 Shri L.N.Malleswara Rao Directors- Key Management Personnel

12 Shri Vidyasagar Anisingaraju

13 Shri Atluri Venkata Ram

14 Shri Anil Goyal

15 Shri U.Ramakrishna

8. Capital work in progress includes revenue expenditure of Rs. 89,840,672/- incurred towards development of LED Lighting products pending capitalization.

10. The company has incurred one time expenditure of Rs. 16,361,609/- during the year towards leased assets which is being amortised over a period of 5 years lease period. During the year an amount of Rs. 1,363,467/- has been amortised.

11. Information as required under part II of Schedule VI to the Companies Act, 1956. a) Class of goods manufactured

S No. Particulars of Goods manufactured

1 LED based Display Systems

2 LED based Light & Lamp Sets

3 LED based Solar Street Light Systems

4 LED based Solar Lantern

5 Communication Hardware & Software Products

14. The names of the Small Scale Industrial (SSI) undertaking to whom the Company owes money which is outstanding for more than 30 days :

Amphenol Interconnect India Pvt Ltd

Anicad Systems

Arti Switchgear Pvt.Ltd.,

Bindu Labels (P) Limited

Bhagyalaxmi Industries

Cipsa-Ric India Pvt Ltd

Cookson India Private Limited

Cosmic Engineering Enterprises

Diagram Fabricators [P] Ltd

DMS Technologies Pvt Ltd

Elite Energy Source

Elmas Power Systems

EPE Industries India Pvt Ltd

Eqic Dies & Moulds Engineering (P) Ltd

Fine Packaging Company

Goodwyn Enterprises

Gujarat Poly-AVX Electronics Ltd

Hicotronics Devices Pvt.Ltd.,

Hillfort Packaging Industries

Image Tooling Solutions

Jagan Micro Devices

Lakshmi Precision Components

LN Poly Products (P) Ltd

Merritronix Pvt Ltd

Micropack Limited

Nikhita Industries

N.N.Safety Glass Industries

Padmapriya Micro Conductors(P)Ltd

Prim Rubber Products

Qualitech Connectronics (P) Ltd

Qubia Enterprises

Robos Engineers

R.R.Kabel Limited, Silvassa

Sai Krishna Tools & Dies

Satchitanand Stencils [P] Ltd

SAT Infotech Pvt Ltd

Shiva Surya Industries

Shredha Engineers

SMEC Electronics (India) P Ltd

Spectrum Components

Sri Hanuma Fabricators

S.S.Engineering Works

Sulakshana Circuits Ltd

Supreme Agencies

S V Poly Phase Systems

SVS Hydraulics

Synergy Solar Pvt Ltd

Synergy Technologies

V3 Enterprises

Valrack Modular Systems[P]Ltd

Variturn Electro Products (P) Ltd

VM Precision Punch Pvt Ltd

Wellfix Cables & Cords

Xpress Digitale Pvt Ltd

Yasaswini Engg & Electronic Systems

The list of SSI Undertakings were determined by the Company on the basis of the information available with the Company and relied upon by the Auditors.

4. The company has identified Micro and Small enterprises as per Micro, Small and Medium Enterprises Development Act 2006. The outstanding for more than 30 days as at 30th June 2010 for the enterprises is Rs. 26,359,168/-.

5. Previous years figures are regrouped wherever necessary to conform to the Current Years Presentation/Classification.

6. Figures have been rounded off to the nearest Rupee.

7. There is no extra ordinary item incurred by the company during the year.


Jun 30, 2009

1. Contingent liabilities not provided for on account of :

(Amount in Rs.)

S No Particulars As at 30.06.09 As at 30.06.08

A Counter guarantees given by the company to banks towards issue of B.Gs. 100,522,738 132,703,165 B Counter guarantees given by the company to banks towards issue of B.Gs to Customs Dept. against advance licenses 1,098,855 1,098,855 C Bonds executed to Customs Deptt. (net of BGs) against advance licenses 2,759,930 2,759,930 D Letter of credits issued by bankers 33,926,707 29,798,618 E Corporate Guarantees given by the company to banks 131,000,000 37,900,000 TAX Matters in Appeals A Excise Duty 21,223,061 -- B Customs Duty 1,801,111 -- C Sales Tax 3,195,527 -- 2. Loans:

Working Capital Loans from SBI & DCB:

a) State Bank of India and Development Credit Bank Limited are secured by pari passu charge on fixed assets and all chargeable current assets of the Company except assets pertaining to Technology Development Board, National Research Development Corporation, IDBI and UCO Bank. State Bank of India and Development Credit Bank Limited are secured by second charge on the assets financed by IDBI and UCO Bank.

b) SBI is further secured by personal guarantees of three of the following Directors of the company.

1. Dr M V Ramana Rao

2. Mr L N Malleswara Rao

3. Mr N. Srinivasa Rao

c) Development Credit Bank Limited is further secured by personal guarantee of Dr. M.V.Ramana Rao, Managing Director of the company. Term Loans:

a) Technology Development Board is secured by all assets pertaining to the development and commercialization of the LED TV / Electronic Display system project along with personal guarantee of Dr. M.V. Ramana Rao, Managing Director.

b) National Research Development Corporation is secured by all the machinery and equipments acquired for the development of "Fraud Management and Control Centre (FMCC)".

c) Term Loan taken from IDBI is secured as follows:

Primary:(i)a first mortgage and charge on Industrial Plot No.192/B in Survey No.274 admeasuring 5341 Sq. Yards situated at Phase II, IDA, Cherlapally village, Kapra Municipality, Ghatkesar Mandal, RR District valued at Rs. 2.50 Crores and proposed building thereon admeasuring 100000 Sq.Ft valued at Rs.12.52 Crores (Approx). (ii)A first hypothecation charge on plant and machinery valued Rs.6.89 Crores.

Collateral: NIL

Personal Guarantee: An irrevocable and unconditional guarantee from Dr. M.V.Ramana Rao in favour of IDBI

d) Term Loan taken from UCO Bank is secured as follows:

Primary: (i) 1st hypothecation charge over the plant and machinery, LED Display Boards, software and other fixed assets of the project of the company at DMRC. (ii) 1st Charge on receivables arising out of the DMRC Project.

Collateral Security: Second charge on the fixed assets of the company other than what has been taken as first charge. The first charge will be with SBI and DCB. UCO Bank is further secured by personal guarantee of Dr. M.V.Ramana Rao, Managing Director.

e) Loans taken against purchase of vehicles are secured by hypothecation of the respective vehicles.

2. The company has identified Micro and Small enterprises as per Micro, Small and Medium Enterprises Development Act 2006. The outstanding for more than 30 days as at 30th June 2009 for the enterprises is Rs. 28,593,977/-

3. Previousyears figures are regrouped wherever necessary to conform to the Current Years Presentation/Classification.

4. Figures have been rounded off to the nearest Rupee.

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