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Notes to Accounts of Neo Corp International Ltd.

Mar 31, 2015

1. NIL Authorized Shares Capital Increased by 52000000 Equity Shares of Rs. 10/- each in order to raise Equity by way of issue of Global Depository (NIL) Receipts(GDRs)/ American Depository Receipts (ADR's) / Foreign Currency Convertible Bonds/ Equity Shares/Warrants or any other similar instruments in financial year 2011-12.

2. NIL 24000000 Equity Shares representing 1200000 GDRs at US$ 19.25 were allotted out of the issued, subscribed and paid up share capital in (NIL) the year 2011-12. Underlying Equity Shares being Rs.20 per GDR.

3. NIL 3500000 Equity Shares of Rs.l0/-each at a premium of Rs. 50 per share were allotted on preferential basis out of the issued, subscribed (NIL) and paid up share capital in the year 2010-11.

4. NIL 292898 Equity Shares of Rs.l0/-each at a premium of Rs.58 per share were allotted on conversion of 292898 Cumulative Compulsory (NIL) convertible Preference Shares ('CCCPs') out of the issued, subscribed and paid up share capital in the year 2010-11.

5. NIL 1575000 Equity Shares of Rs.l0/-each at a premium of Rs.43/- per share were allotted pursuant to conversion of warrants out of the (NIL) issued, subscribed and paid up share capital in compliance with SEBI(ICDR) Regulations, 2009 in the year 2010-11.

6. 2439573 2439573 Equity shares out of the issued, subscribed and paid up share capital held by subsidiary and associate companies having voting (2423573) rights and eligible for dividend.

7. The company has accounted Capital Subsidy received or to be receivable under TUFF Scheme from Ministry of Textiles, Govt, of India on eligible assets. The company has accounted the same on accrual basis and proposed to amortize in future years as per AS-12 "Government Grants" and AS-10 "Fixed Assets"

8. As per AS-12 "Government Grants" and AS-10 "Fixed Assets", proportionate capital subsidy amounting to Rs. 2607829/- has been written back to Profit & Loss Accounts during the year under head-Other income".

9. (a) Term Loans are secured by equitable mortgage on the entire immovable fixed assets of the company, hypothecation of entire movable plant and machinery and second paripasu charge on the entire current assets located at Plot No.62-63-64 A, Sector 1 and Plot no. A 12-13, SEZ Phase Industrial Area, Pithampur. Term Loan is further secured by pledge of Equity Shares & Corporate Guarantee of Promoter/ associates/ subsidiaries and Others.

(b) Term Loan is secured by Machine and Equipments of Wind Mills at Bavdikheada (Mahuriya), District Sajapur M.P. exclusively With State Bank of India and pledge of Equity Shares of Promoters Others.

(c) All the term loans are further secured by personal guarantee of the Chairman & Managing Director Mr. Sunil Trivedi and Executive Director Mr. Utkarsh Trivedi. -

(d) Vehicle loans are secured by hypothecation of respective vehicles of the Company however no charge has been created with Registrar of Companies as per provision of the companies Act 2013 and rules there on and shall be created in due course of time.

10. The valuation of closing stock of finished goods include excise duty payable of Rs.22947399/- as on 31.03.2015 (Rs.22720991/-as on 31.03.2014).

11. The inventory includes stock of Rs. 10937970/- which represent stock manufacturing at R & D centre of the company.

12. The inventory includes excess inventory of Rs.66894723/-found during the search under the income Tax Act, 1961.

# The Trade Receivable is showing after deducting amount of Rs.173906039/- towards factoring limit on receivable taken from SBI Global Factors Ltd. for Rs. 74021364/- (O/s. as on 31.03.2015) and Canbank Factors Ltd. of Rs. 99884675/- (O/s. as on 31.03.2015). Further the factoring limit from SBI Global Factors Ltd. is secured by FDR worth Rs 2.95 Crores and personal guarantee of Chairman & Managing Director, Mr. SunilTrivedi and Executive Director, Mr. UtkarshTrivedi.

a. # Balance with Scheduled Bank includes Unclaimed dividend of Rs. 14626973/- (Rs. 14982197/-) as on 31.03.2015.

b. *Fixed deposit with Banks include deposits of Rs. 30359379/- (78116118/-) with maturity of more than 12 months.

# There was a major fire accident in the factory premises of the unit named M/s. Tec textile (A 100% EOU Division of the Company) during the year 2009-10. The Company had accounted for losses net of claim received during the year 2012-13. The Company has gone in Arbitration for balance claim of Rs. 48867574/-which is not considered by the Insurance Companies and shown as receivable and consider good being decision of Arbitration is awaited.

*The above amount include advance given to employees of the company amounting to Rs. 5401174/- (Rs. 4618732/-).

#The Company is having consignment stockiest and Del Cedder Agency of Indian Oil Corporation Ltd run in separate Polymer Division.

** The Miscellaneous Income includes cash equivalent to employees benefit expenditure of Rs.3900000/- found unrecorded during the search under the income Tax Act, 1961.

# The Company has a Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P. During the year it has earned an income of Rs 10580900/-(Rs. 10853658/-) by way of sale of power to MPPKVV. Co. Ltd.

* The Capital Subsidy received to Company against purchase of Fixed Assets in different years is adjusted as per AS-12 "Government Grants" and AS-10 "Fixed Assets". During year company has written back proportionate subsidy amounting to Rs. 2607829/- (Rs. 2607829/-) has been written back to Profit & Loss Accounts.

# Raw Material Consumed includes an amount of Rs. 26306901/- (Rs. 191451/-) and Stores & Spare Parts Consumed includes an amount of Rs. 8958/- (Rs. NIL) for consumption in R & D Center.

13. Includes an amount of Rs. 9357277/-(Rs. 4430783/-) pertaining to the employee expenses incurred on its R&D Center.

14. The Company has adopted revised accounting standard -15 "Employees Benefits" issued by the Institute of Chartered Accountants of India with effect from 1.4.2007 and consequently the transitional excess provisions of gratuity as per the actuary report has been taken in provision. As per accounting standard 15 "Employee benefits "the disclosures as defined in the Accounting Standard are given as under;

(i) Provident Fund: Defined Distribution Plan

All Employees are entitled to Provident Fund Benefits. The amount debited to Profit and Loss Account is Rs 3213265/- (Rs. 2643319/-) during the year.

(ii) Gratuity and Leave Encashment: Definite Benefit Plans

Provisions made as per actuarial valuation.

* The inventory includes excess inventory of Rs.66894723/-found during the search under the Income Tax Act, 1961.

# Other Expenses includes an amount of Rs.553500/- (Rs.128702/-) pertaining to the administrative expenses, Rs. 288612/- (Rs.1232500/-) pertaining to Testing Fees/Certification Fees Expenses and Rs. NIL (Rs.202594/-) pertaining to other manufacturing expenses on its R&D Center.

15. RELATED PARTY DISCLOSURE

The Management has identified the following Companies and Individuals as related parties of the Company for the year ended 31st March 2015 for the purposes of reporting as per AS-18 (Related Party Transaction).

I. Related Party Relationship

Subsidiary Companies M/s Euro Plats Limited

M/sSacos Indigo Private Limited

M/s Neoflex Infracon Limited

M/s Polybase(H.K.) Limited

M/s Poly Logic International Private Limited

M/s Prism Flexible Solutions Private Limited

Group Companies M/s Panam Packers Private Limited

M/s Synergy Education International Private Limited

M/s Vishwkarma Creations Private Limited

M/s Olympian Investors & Traders Private Limited

Key Managerial Personnel Mr. Sunil K. Trivedi

Mr.UtkarshS.Trivedi Mr.PradhumanSharma Ms.JyotiDubey(CFO) Ms. Swati Gangrade (CS)

Relatives of Key Managerial Personnel Ms. Nandita S. Trivedi

Mr. AatmanS. Trivedi Mr. SanjayK. Trivedi

Ms. MaitriU. Trivedi

16. SEGMENT REPORTING

The group operating business is organized and managed separately according to the nature of the product and services provided, with each segment representing a strategic business unit that offers different products and serves different market. The analysis of geographical segment is based on the areas in which major operating division of the group operate.

i. The company has mainly business of manufacture of technical textiles. The company has another division namely Polymer Division in which consignment stockiest and Del Cedder agency of Indian Oil Corporation Ltd is operated. The company has also set-up Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P for power generation. There are no other business segment reportable other than these, as per Accounting Standard AS-17. The of details are as under:

ii. The Company has two reportable segment on basis of geographical segment, one is domestic sales and another is overseas sales. There is no other separate reportable geographical egment other than this, as per AccountingStandardAS-17.

17. The Company has a SEZ Division namely M/s. Geotech Worldwide in which company has exemption of Income Tax however provision of MAT is applicable on this division. Other divisions i.e DTA Division, 100% EOU Division and Polymer Division are covered under normal provision of the IT. Act. The higher of Normal Tax Liability and MAT Tax Liability is provided in the Books of Accounts.

18. In respect to the Accounting Standard AS-19 pertaining to "Lease", issued by the ICAI which is mandatory with effect from 1st Apr 2001 and as applicable to all the leased assets for which the lease commences on or after 1st Apr 2001, the company did not have any operating lease during the year 2014-15. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

19. Estimated amount of contracts remaining to be executed on capital account is Rs. 515000000/- (Pre. Year Rs.550000000/-).

20. In the opinion of the management and to the best of their knowledge and belief the value of realization of current assets, Loans and advances in the ordinary course of business will not bless than the amount at which they are stated in the balance sheet.

21. Debit and Credit balance are subject to confirmation

22. Figure has been rounded off to the nearest rupees.

23. Figures of the previous year have been re-grouped/re-arranged/re-classified wherever necessary to the facilitate comparison.

1. Names of subsidiary which are yet to commence operations: Polybasic (H.K.) Limited, Prism Flexible Solutions Private Limited

2. Names of subsidiary which have been liquidated or sold during the year: NIL

3. Exchange Rate used in case of foreign subsidiaries:

For Polybasic (H.K.) Limited: 1HKD = 8.039 INR

For Euro last Limited: Share Capital, Reserve & Surplus, Total Assets, Total Liabilities and Investments at exchange rate as on 31.03.15:1 GBP = 92.55 INR

Turnover, Profit before tax, Provision for taxation and Profit after tax at annual average exchange rate: 1 GBP = 98.58 INR

4. Part B of the Annexure is not applicable as there are no associate companies/joint ventures of the Company as on 31st March, 2015


Mar 31, 2014

1.1 NIL Authorised Capital Increased by 52000000 Equity Shares of 10/- each in order to raise Equity by way of issue of Global Depository (NIL) Receipts(GDRs)/ American Depository Receipts (ADR''s) / Foreign Currency Convertible Bonds/ Equity Shares/Warrants or any other similar instruments in financial year 2011-12.

1.2 NIL 24000000 Equity Shares representing 1200000 GDRs at US$ 19.25 were allotted out of the issued, subscribed and paid up share capital in (NIL) the year 2011-12. Underlying Equity Shares being 20 per GDR.

1.3 NIL 3500000 Equity Shares of 10/- each at a premium of 50 per share were allotted on preferential basis out of the issued, subscribed (NIL) and paid up share capital in the year 2010-11.

1.4 NIL 292898 Equity Shares of 10/- each at a premium of 58 per share were allotted on conversion of 292898 Cumulative Compulsory (NIL) convertible Preference Shares (''CCCPs'') out of the issued, subscribed and paid up share capital in the year 2010-11.

1.5 NIL 1575000 Equity Shares of 10/- each at a premium of 43/- per share were allotted pursuant to conversion of warrants out of the (NIL) issued, subscribed and paid up share capital in complaince with SEBI(ICDR) Regulations, 2009 in the year 2010-11.

1.6 2423573 2423573 Equity shares out of the issued, subscribed and paid up share capital held by subsidiary and associate companies having voting (799984) rights and eligible for dividend.

2.1 The Captial Subsidy of 115.38 Lacs is receivable under TUFF Scheme from Ministry of Textiles, Govt, of India on eligible assets. The company has accounted the same on accural basis and proposed to amortise in future years as per AS-12 "Government Grants" and AS-10 "Fixed Assets".

2.2 As per AS-12 "Government Grants" and AS-10 "Fixed Assets", proportionate capital subsidy amounting to 2607829/-has been written back to Profit & Loss Accounts during the year under head-Other lncome".

2.3 Board of the company had proposed dividend of 5% per equity share for the year 2012-13. But in the AGM of the Company same has been approved @ 2% perequity share. Consequently 3% has been written back in books of accounts during year.

3.1 (a) Term Loans are secured by equitable mortgage on the entire immovable fixed assets of the company, hypothecation of entire movable plant and machinery and second paripasu charge on the entire current assets located at plot No.62-63-64 A, Sector 1 and Plot no. A 12-13, SEZ Phase ^Industrial Area, Pithampur. Term Loan is further secured by pledge of Equity Shares & Corporate Guarantee of Promoter/Associates/Subsidiaries and others.

(b) Term loan of 5.81 Crore is secured by Machine and Equipments of Wind Mills at Bavdikheada (Mahuriya), District Sajapur M. P. exclusivly with State Bank of India and pledge of Equity Shares of Promoters & Others.

(c) All the term loans are further secured by personal guarantee of the Chairman & Managing Director, Mr. Sunil K. Trivedi. ** (d) Vehicle loans are secured by hypothecation of respective vehicles of the Company

* 4.1 The Working capital Limit is secured by first charge on entire current assets viz Raw Material, Finished Goods, Packing Material, Stores & Spares, Work in Progress, Book Debts, Outstanding Moneys Receivables, Claims & Second Pari Passu charge on the entire Fixed Assets of the Company. The working capital is further secured by pledge of Equity Shares & Corporate Guarantee of Promoter/ Associates/ Subsidiaries and others.

** 4.2 The channel finance limit from SBI is secured by hypothecation of receivables for which the invoices have been raised along with equitable mortgage on the property located at Plot no. 9, Devgudadia, Indore. It is also secured by way of personal guarantee of the Chairman &Manging Director, Mr. Sunil K.Trivedi.

*** 4.3 The factoring limit from SBI Global Factors is secured by FDR worth 2.95 Crores and personal guarantee of Chairman & Managing Director, Mr. Sunil K.Trivedi and Director, Mr. Utkarsh S.Trivedi.

4.4 All the Working Capital Limit are further secured by personal guarantee of the Chairman & Managing Director,

Mr. Sunil K.Trivedi.

#9(e)(i) Other payables include creditors for Capital Expenditure of 56292614/- and amount payable to M/s Fukam International Limited (the shareholders of Euro Plast Limited (U. K.) 38891500/- towards takeover of the Company in previous years and also include amount payable of 57,180/- to Allshores Fiduciary Services Pte for acquiring 100 % sharesof Company M/s Polybase(H.K.) Limited.

* 9(e)(ii) As information and explanation given by the management, there is no amount due and outstanding to be credited to Investor Education & Protection Fund as on 31.03.2014.

There was a major fire accident in the factory premises of the unit named M/s. Techtextile (A 100% EOU Division of the Company) during the year 2009-10. The Company had accounted for losses net of claim received during the year 2012-13. The Company has gone in Arbitation for balance claim of 488.68 Lacs not considered by the Insurance Companies and shown as receivable and consider good being decision of Abritation is awaited.

# The Company has a Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P. During the year it has earned an income of 10853658/- (Rs. 13438117/-) by way of sale of power to MPPKVV.Co. Ltd.

* The Captial Subsidy received to Company against purchase of Fixed Assets in different years is adjusted as per AS-12 "Government Grants" and AS-10 "Fixed Assets" . During year company has written back proportionate subsidy amounting to 2607829/- (Rs.657413/-) has been written backto Profit & Loss Accounts.

The Company has adopted revised accounting standard -15 "Employees Benefits" issued by the Institute of Chartered Accountants of India with effect from 1.4.2007 and consequently the transitional excess provisions of gratuity as per the actuary report has been taken in provision. As per accounting standard 15 "Employee benefits"the disclosures as defined in the Accounting Standard are given as under;

(i) Provident Fund = Defined Distribution Plan

All Employees are entitled to Provident Fund Benefits. The amount debited to Profit and Loss Account is 2643319/- (Rs.2422831/-) during the year.

(ii) Gratuity and Leave Encashment: Definite Benefit Plans

Provisions made as peracturial valuation.

# lncludes an amount of 128702/-(Rs.2030628/-) pertaining to the administrative expenses/ 1232500/-(Rs.1076250/-) pertaining to consultancy charges incurred and 567071/- (Rs.202594/-) pertaining to other manufacturing expenses on its R&D Center.

5.1. Miscellaneous expenses includes balance amount of «1123301/-of Preliminary Expenses incurred during the year 2011-12 for increase in Authorised Share Capital has being written off as per provision of Revised Schedule-VI of the Companies Act, 1956

6. Exceptional and Extraordinary Items include extraordinary item for written off insurance claim receivable of Rs.NIL (Rs.78237728/-)against stock and NIL( 40078047/-) against fixed assets) during the year.

7 RELATED PARTY DISCLOSURE

The Management has identified the following Companies and Individuals as related parties of the Company for the year ended 31st March 2014 for the purposes of reporting as per AS-18(Related Party Transaction).

I. Related Party Relationship

Subsidiary Companies M/s Euro Plast Limited

M/sSacos Indigo Private Limited

M/s Neoflex Infracon Limited

M/s Polybase (H.K.) Limited

M/s Poly Logic International Private Limited

M/s Prism Flexible Solutions Private Limited

Associated Companies M/s Panam Packers Private Limited

M/s Synergy Education International Private Limited

M/s Vishwkarma Creations Private Limited

M/s Olympian Investors & Traders Private Limited

Key Management Personnel Mr. Sunil K. Trivedi

Mr.UtkarshS.Trivedi Mr.PradhumanSharma Mr. Sharwan Kumar Patodi Mr. Ladharam Patel Mrs Shobha Dubey Mr.Rolland Coderre

Relatives of Key Management Personnel Ms. Nandita S. Trivedi

Mr.UtkarshS.Trivedi Ms. RupalS. Trivedi Mr. AatmanS. Trivedi Mr. SanjayK. Trivedi _Mrs MaitriU. Trivedi

31 SEGMENT REPORTING

The group operating business is organised and managed separately according to the nature of the product and services provided, with each segment representing a strategic business unit that offers different products and serves different market. The analysis of geographical segment is based on the areas in which major operating division of the group operate.

a. The Company is generally in the business of manufacture of technical textiles. The Company also has a division namely Polymer Division in which consignment stockist and Del Cedder agency of Indian Oil Corporation Ltd is operated. The company has also set-up Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P for power generation. There are no other business segment reportable other than this, as per Accounting Standard AS-17. The details are as under:

8 CONTINGENT LIABILITY AND COMMITMENT

particu|ars For the year Ended For the year Ended

Letters of Credit opened Bank Guarantee issued by Banks 36633000 36893000

Corporate Guarantee (Issued for subsidiary M/s. Sacos Indigo Private Limited) 1407000000 1107400000

Income Tax demands to the extent disputed in appeals 2116000 2116000

Commercial Tax demands to the extent disputed in appeals 16922649 16922649

Excise & Customs due under various show cause notices issued by the authorities is disputed by the company. The company is hopeful of getting the matter settled in its favour. 7843000 11719000

9. The Company has a SEZ Division namely M/s. Geotech Worldwide in which Company has exemption of Income Tax however provision of MAT is applicable on this division. Other divisions i.e DTA Division, 100% EOU Division and Polymer Division are covered under normal provision of the IT. Act. The higher of Normal Tax Liability and MAT Tax Liability is provided in the Books of Accounts.

10. In respect to the Accounting Standard AS-19 pertaining to "Lease", issued by the ICAI which is mandatory with effect from 1st Apr 2001 and as applicable to all the leased assets for which the lease commences on or after 1st Apr 2001, the company did not have any operating lease during the year 2013-14. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

11. Estimated amount of contracts remaining to be executed on capital account is 650000000/- (Pre.Year 550000000/-).

12. In the opinion of the management and to the best of their knowledge and belief the value of realization of current assets, Loans and advances in the ordinary course of business will not be less than the amount at which the yeres stated in the balance sheet.

13. Debit and Credit balances are subject to confirmation.

14. Figure has been rounded off to the nearest rupees.

15. Figures of the previous year have been re-grouped/re-arranged/re- classified wherever necessary to the facilitate comparison.


Mar 31, 2013

1 SEGMENT REPORTING

The group operating business is organised and managed separately according to the nature of the product and services provided, with each egment representing a strategic business unit that offers different products and serves different market. The analysis of geographical segment is based on the areas in which major operatingdivision of thegroup operate.

a. The company is generally in the business of manufacture of technicalte xtiles. The company al so has adivisionnamelyPolymerDivisioninwhich consignment stockist and Del Cedder agency of Indian Oil Corporation Limited is operated. The company has also set-up Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P for power generation. There are no other business segment reportable other than this, as per AccountingStandardAS-17.Thedetailsareas under:

b. The company has two reportable segment on basis of geographical segment, one is domestic sales and another is overseas sales. There is no other separate reportable geographical segment otherthanthis,as per AccountingStandard AS-17.

2. CONTINGENT LIABILITY AND COMMITMENT

For the year Ended For the year Ended Partlculars 31.03.2013 31.03.2012 Amount Amount

Letters of Credit opened

Bank Guarantee issued by Banks 36893000 36893000

Corporate Guarantee (Issued for subsidiary M/s. Sacos Indigo Private Limited) 1107400000 877400000

Income Tax demands to the extent disputed in appeals 2116000 2116000

Excise & Customs due under various show cause notices issued by the authorities is disputed by the company.

The company is hopeful of getting 11719000 11719000 the matter settled in its favour.

3. The Company has a SEZ Division namely M/s. Geotech Worldwide in which company has exemption of Income Tax however provision of MAT is applicable on this division. Other divisions i.e DTA Division, 100% EOU Division and Polymer Division are covered under normal provision ofthel.T.Act. The higherof NormalTaxLiabilityand MATTaxLiabilityisprovidedintheBooks of Accounts.

4. In respect to the Accounting Standard AS-19 pertaining to "Lease", issued by the ICAI which is mandatory with effect from 1st April 2001 and asapplicabletoallthe leased assets for which the lease commences on or after 1st April2001, the company did not have any operating lease during the year 2012-13. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

5. Estimated amount of contracts remainingto be executed on capital account is Rs. 550000000/- (Previous Year Rs. 58040914/-).

6. In the opinion of the management and to the best of their knowledge and belief the value of realization of current assets, Loans and advancesintheordinary course of business will not be less thantheamountat which theyarestated in the balance sheet.

7. Debit and Credit balances are subject to confirmation.

8. Figure has been rounded off to the nearest rupees.

9. Figures of the previous year have been re-grouped/re-arranged/re-classi fied wher ever necessary to the facilitate comparison.


Mar 31, 2012

1.1 The Captial Subsidy of Rs. 124.52 Lacs carried from last year is adjusted as per AS-12 "Government Grants" and AS-10 "Fixed Assets" and proportionate subsidy amounting to Rs. 657413/- has been written back to Profit & Loss Accounts during the year.

1.2 Company has gained profit on capital transaction in foreign currency which has been credited in Foreign Currency Fluctuation Reserve as defined in AS -11 "Accounting for changes in the effect of Foreign Exchange Rate".

*2.1 (a) Secured by first pari passu charge on the entire fixed assets ofthe company located at plot No.62-63-64 A, Sector 1, Industrial Area Pithampur Distt. Dhar and second pari pasu charge on the entire current assets of the company and pledge of Equity Shares of Promoter and Others.

*3.1 (b) Term Loan ofRs. 5.81 Crore is secured by Machine and Equipments of Wind Mill at Bavdikheada (Mahuriya), District SajapurM.P.exclusivIy with State Bank of India and pledge of Equity Shares of Promoter and Others.

# As per the information provided by the management that none of the suppliers of the company are registered under the Micro, Small & Medium Enterprises Development Act 2006. The company has not received any claims in respect of interest from any such undertaking during the year.

#8(e)(i) Other payables include creditors for Capital Expenditure ofRs. 12,47,77,184/- and amount payable to M/s Fukam International Ltd. (the share holders of Euro Plast Ltd. U. K.) Rs. 3,88,91,500/- towards takeover of the company in previous years and also include amount payable of Rs. 57,180/- to Allshores Fiduciary Services Pte Ltd for acquiring 100% shares of company M/s Polybase (H.K.) Ltd.

* 8(e)(ii) As information and explanation given by the management there are no amounts due and outstanding to be credited to Investor Education & Protection Fund as on 31st March, 2012.

# The company has also setup a Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P during the year and earned an income of Rs. 3067173/-by way of sale of power to MPPKW.Co. Ltd

* The Captial Subsidy of Rs. 124.52 Lacs carried from last year is adjusted as per AS-12 "Government Grants" and AS-10 "Fixed Assets" and proportionate subsidy amounting to Rs. 657413/- has been written back to Profit & Loss Accounts during the year.

# Includes an amount of Rs. 4,427,052/- pertaining to the employee expenses incurred on its certified R&D Center.

4.1 The company has adopted revised accounting standard - 15 "Employees Benefits" issued by the Institute of Chartered Accountants of India with effect from 1.4.2007 and consequently the transitional excess provisions of gratuity as per the actuary report has been taken in provision. As per accounting standard 15 "Employee benefits"the disclosures as defined in the Accounting Standard are given as under;

(i) Provident Fund: Defined Distribution Plan

All Employees are entitled to Provident Fund Benefits. The amount debited to Profit and Loss Account is Rs. 2438785/- during the year

(ii) Gratuity and Leave Encashment: Definite Benefits Plans Provisions made as per acturial valuation.

5 SEGMENT REPORTING

The group operating business is organised and managed separately according to the nature of the product and services provided, with each segment representing a strategic business unit that offers different products and serves different market. The analysis of geographical segment is based on the areas in which major operating division of the group operate.

a. The company is generally in the business of manufacture of technical textiles. The company also has a division namely Polymer Division in which consignment stockist and Del Cedder agency of Indian Oil Corporation Ltd is operated. During the year the company has also set-up Wind Mill at Bavdikheada (Mahuriya), District Sajapur M.P for power generation. There are no other business segment reportable other than this, as per Accounting Standard AS -17. The details are as under:

6. The Company has a SEZ Division namely M/s. Geotech Worldwide in which company has exemption of Income Tax however provision of MAT is applicable on this division. Other divisions i.e DTA Division, 100% EOU Division and Polymer Division are covered under normal provision ofthe I.T. Act. The higher of Normal Tax Liability and MAT Tax Liability is provided in the Books of Accounts.

7. In respect to the Accounting Standard AS-19 pertaining to "Lease", issued by the ICAI which is mandatory with effect from 1st Apr 2001 and as applicable to all the leased assets for which the lease commences on or after 1st Apr 2001, the company did not have any operating lease during the year 2011-12. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

8. Estimated amount of contracts remaining to be executed on capital account and not provided forRs. 58,040,914/- (Previous Year Rs. 19,306,672/-).

9. In the opinion ofthe management and to the best of their knowledge and belief the value of realization of current assets, Loans and advances in the ordinary course of business will not be less than the amount at which they are stated in the balance sheet.

10. In the opinion ofthe management and to the best of their knowledge and belief the value of realization of current assets, Loans and advances in the ordinary course of business will not be less than the amount at which they are stated in the balance sheet.

11. Debit and Credit balances are subject to confirmation.

12. Figure has been rounded off to the nearest rupees.

13. Figures ofthe previous year have been re-grouped/re-arranged/re-classified wherever necessary to the facilitate comparisone


Mar 31, 2011

A. Estimated amount of contracts remaining to be executed on capital account and not provided forRs 1,93,06,672/-(Pre. YearRs 2,30,01,310/-).

B. Contingent liabilities not provided for in respect of:

(Figure in Lacs)

Particulars 31.03.2011 31.03.2010

Letters of Credit opened NIL NIL

Bank Guarantee issued by banks Rs 3840.00 Rs 20.00 (Issued for subsidiary M/s. Sacos Indigo Pvt. Ltd.)

Income tax demands to the extent disputed in appeals NIL NIL

Excise & Customs due under various show cause notices issued by Rs 101.97 Rs 98.77 the authorities is disputed by the company. The company is hopeful of getting the matter settled in its favour.

Sales tax demands under appeal Nil Nil

Commercial tax demands in appeals Nil Nil

C. ln the opinion of the management and to the best of their knowledge and belief the value of realization of current assets, Loans and advances in the ordinary course of business will not be less than the amount at which they are stated in the balance sheet.

D. Managerial Remuneration paid to the Directors is as per Schedule XIII of the Companies Act 1956.

E. Export incentive receivables have been adjusted on the basis of duty free license scheme against advance license/DEPB/DDBK/duty refund/DFRC.

F. Being the Company has a 100% Export Division namely M/s. Tec textile on which company has exemption of tax under section 10B of the Income Tax Act 1961 hence not liable to pay tax on this income of this division. The provision of tax liability on DTA Division and Polymer Division is under normal provision of the l.T Act with compared to the MAT tax liability. The higher of these two figures is provided in the Books of Accounts.

G. As per the in formation provided by the management, that none of the suppliers of the company are registered under the Micro, Small & Medium Enterprises Development Act 2006. Also company has not received any claims in respect of interest from any under taking.

H. The valuation of closing stock of finished goods includes excise duty payable of Rs51,41,341/- as on 31.3.2011 (Rs46,90,374/- as on 31.3.2010).

I. The company has received capital subsidy ofRs 124.52, Lacs during the year under TUFF Scheme. According to the accounting policy followed by the Company, the said amount is credited to Capital Reserve Amount But being all the eligible assets are not capitalised and some of them are laying in the Capital Work in progress therefore this year the compliance of proportionate appropriation to Profit & Loss account is not possible for the Company. However same will be done next year on ward

J. In respect to the Accounting Standard AS-19 pertaining to Tease", issued by the ICAI which is mandatory with effect from 1.4.01 and as applicable to all the leased assets for which the lease commences on or after 1.401, the company did not have any operating lease during year 2010-11. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

K. The company in the years 2009-10 had collected Rs199.17 Lacs as application money for cumulative compulsory convertible preference share (CCPS) and same has been converted and allotted equity shares to the applicant at the face value of Rs10/- and with premium ofRs 58 per shares during the year.

L. The company had collected Rs 507.37 Lacs towards application money for convertible warrants in the year 2009-10. During the year the company has allotted the shares to Equity warrant holder at face value ofRs 10 each with premium of Rs 23 each warrants.

i) M/s Neo Corp International Limited (the holding company) has entered into takeover agreement on 29.03.2008 with M/s Europlast Limited, a U.K. based company for purchase of their entire shareholding on deferred payment basis for a consideration of 800 000 GBP (Rs5,80,48,000/-) and paid Rs1,90,663 GBP (Rs1,46,90,500/-) during the year 2009-10 after receiving permission from Reserve Bank of India. During year company has paid Rs65686 GBP (Rs 44,66,000/-) to M/s. Fukam International Ltd., Hong Kong, and now the balance amount of 543651 GBP (Rs3,88,91,500/-) payable is reflected in other liability. However the M/s. Fukam International Ltd., Hong Kong has transferred the shares in favour of Neo Corp international Limited.

ii) The company during the year has given corporate guarantee for its domestic subsidiary M/s Sacos Indigo Pvt. Ltd for the loan of Rs 3840.00 Lacs availed from SBI Overseas Branch Mumbai.

M. There was a major fire accident in the factory premises of the unit named M/s. Tech textile (A 100% EOU Division of the Company) during last year on 27lh & 28lh February, 2010. The total loss of assets has been valued to Rs 5205.16 Lacs consist of both the division of the Company. The said assets were covered by insurance policies with Insurance Companies. The claim is yet to be finalised, however interim payment of Rs1500.00 Lacs is being received. The processing of the claim is at an advance stage with the Insurance companies and the company is hopeful for finalisation at the earliest.

N. The company has given various advances to the extent of Rs 598.03 Lacs towards supply of various material, services and expenses which are pending for final adjustment and have been considered as good and recoverable.

O. There are no amounts due and out standing to be credited to investor Education & Protection Fund as on 31.3.2011.

P. (a) The company has adopted revised accounting standard 15 Employees Benefits issued by the institute of Chartered Accountants of lndia with effect from 1.4.2007 and consequently the transitional excess provisions of Rs Nil of gratuity as per the actuary report has been directly added to general reserves.

(i) Provident Fund Defined Contribution Plan

All employees are entitled to Provident Fund benefits. Amount debited to Profit and Loss account is Rs23,40,876/- during the year.

(ii) Gratuity and Leave encashment Defined Benefit Plans Provision made as per actuarial valuation.

Q. The groups operating business are organised and managed separately according to the nature of the product and services provided, with each segment representing a strategic business unit that offers different products and serves different market. The analysis of geographical segment is based on the areas in which major operating division of the group operate.

a) The company is in the business of manufacture of technical textiles and during year company has set up new division in name of M/s. Neo Corp International Ltd (Polymer Division.) in which company has received the C & F agency of Indian Oil Corporation Ltd. There are no other separate reportable business segment, as per Accounting Standard AS-17.

b) The company has also started another division in the name of Geotech Worldwide in the SEZ Area Pithampur. The company has received allotment of land from MPAKVN for Rs 2.41 Crore and paid Rs 24.30 lacs as advance money the other formalities are in progress.

R. Related Party Disclosures:

The Management has identified the following Companies and individuals as related parties of the Company for the year ended 3 f March 2011 for the purposes of reporting as per AS-18(Related Party Transaction)

S. The company has entered into forward contracts to offset foreign currency risks arising from the amounts denominated in currencies other than Indian rupees. The counter party to such forward contract is a bank. Details of Forward Contracts outstanding at the yearend:

Net exchange difference in respect of forward contract is recognized in the current year. Foreign Currency exposure at the yearend on the dyed by derivative instruments :

T. Debit and Credit balances are subject to confirmation.

U. Figure has been rounded off to the nearest rupees.

V. Figures of the previous year have been re-grouped/re-arranged/re-classified wherever necessary to the facilitate comparison.


Mar 31, 2010

A. Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.2,30,01,310/- (Pre.Year Rs. 19,50,00,000/-).

B. Contingent liabilities not provided for in respect of: (Rs. In lacs)

Particulars 31.03.2010 31.03.2009

Letters of Credit opened NIL 3.68

Bank Guarantee issued by banks 20.00 Nil

Income tax demands to the extent disputed in appeals NIL 0.37

Excise & Customs due under various show cause 98.77 98.77 notices issued by t he authorities is disputed by the company.

The company is hopeful of getting the matter settled in its favour Sales tax demands under appeal Nil Nil

Commercial tax demands in appeals Nil Nil

C Export incentive receivables have been adjusted on the basis of duty free license scheme against advance license/DEPB/DDBK/dutyrefund/DFRC.

D. Being the Company has a 100% Export Division namely Techtextiles on which company has exemption of tax under section 10B of the Income Tax Act, 1961 hence not liable to pay tax on this income of this division. The provision of tax liability on DTA Division is under normal provision of the I.T. Act with compared to the MAT tax liability. The higher of these two figures is provided in the Books of Accounts.

E. As per the information provided by the management, that none of the suppliers of the company are registered under the Micro, Small & Medium Enterprises Development Act 2006. Also company has not received any claims in respect of interest from any undertaking.

F. The valuation of closing stock of finished goods includes excise duty payable of 46,90,374/- as on 31.3.10 (17,56,493/-as on 31.3.09).

G. In respect to the Accounting Standard AS-19 pertaining to "Lease", issued by the ICAI which is mandatory with effect from 1.4.01 and as applicable to all the leased assets for which the lease commences on or after 1.4.01, the company did not have any operating lease during the year 2009-10. However, yearly lease rentals are charged directly to the profit & loss account with reference to the term of lease.

H. The company in the previous years had collected Rs.199.17 Lacs as application money for cumulative compulsory convertible preference share (CCPS). The company has received approval from BSE for allotment of CCPS on 14th May 2009 and has gone ahead with allotment on 18m May 2009. The company had also collected Rs. 58.90 Lacs towards convertible warrants but the allotment of the same could not be done due to non eligibility in regulation 72 of ICDR, 2009. That the company has refunded Rs. 50.00 Lacs during the current year and refunded the balance amount ofRs. 8.90 Lacs on 31s1 May 2010.

I. The company had collected 507.37 Lacs towards application money for convertible warrants. Company has received the approval for allotment of warrants on 03rd March 2010, and under gone with the allotment procedure which has been completed after fulfilling all requirements and allotted the warrants on 05lh June 2010.

J i) M/s Neo Corp International Limited (the holding company) has entered into takeover agreement on 29.03.2008 with Europiast Limited, a U.K. based company for purchase of their entire shareholding on deferred payment basis for a consideration of 800,000 GBP (Rs.5,80,48,000/-) and paid 1,90,663 GBP (Rs.1,46,90,500/-) during the year after receiving permission from Reserve Bank of India. The balance amount of 6,09,337 GPB (Rs. 4,33,57,500) is payable to Fukam International Ltd., Hong Kong and reflected in sundry creditor. Another supplementary agreement has been executed on 29.03.2010 and extended further time of 18 months for payment considering the major fire accident taken place in the holding company. But no shares of the Europiast Limited have been transferred in favour of the holding company. The management claimed status of subsidiary on the basis of tri-party agreement entered with said Europiast Ltd, U.K. and Fukam International Ltd., Hong Kong that they have full control on the Board of directors of Europiast Ltd. Therefore by virtue of Section 4(1 )(a) of the Companies Act 1956 it became subsidiary company of Neo Corp International Limited.

ii) The company has made another acquisition during the year in the Pithampur based company i.e. M/s. Sacos Indigo (P) Ltd and it became subsidiary of NCIL by virtue of said investment in equity shares. The Company has implemented a project of BOPP coated bags, tuber bags etc which has commenced production in August 2010 and they have already received sanction of Rs. 38.40 Crore credit facilities from State Bank of India Mumbai for the said project. The company has not given any guarantee for said loan during the year.

K. A massive fire accident took place on 27th & 28th February, 2010 at its 100% EOU Division (namely "Techtextil") factory premises located at Plot No. 64-A, Sector-1, Industrial Area Pithampur (Distt. Dhar) by which super structure of factory Building and plant and machinery along with raw material, WIP, finished goods and other movable assets is destroyed. The company reported total loss of Rs. 5205.16 Lacs on account of fixed assets and stocks. The loss assets were adequately covered by insurance policies of United India Insurance Company Ltd. and The Oriental Insurance Company Ltd. The Company has received an interim claim amount of Rs. 750.00 Lacs and hopeful to settle the final claim very soon. As the management has already started the process of revamping, therefore it will not affect the going concern assumption for the Company.

L. The company has given various advances to the extent of Rs.486.24 Lacs towards supply of various material, services and expenses which are pending for final adjustment and have been considered as good and recoverable.

M. There are no amounts due and outstanding to be credited to Investor Education & Protection Fund as on 31.3.2010.

N. (a) The company has adopted revised accounting standard 15 "Employees Benefits" issued by the Institute of Chartered Accountants of India with effect from 1.4.2007 and consequently the transitional excess provisions of Nil of gratuity as per the actuary report has been directly added to general reserves.

(i) Provident Fund Defined Contribution Plan

All employees are entitled to Provident Fund benefits. Amount debited to Profit and Loss account is 16,44,714/- during the year.

(ii) Gratuity and Leave encashment Defined Benefit Plans Provision made as per actuarial valuation

(b) Other disclosures as per the Revised AS-15 are as under:

O. Related Party Disclosures:

The Management has identified the following Companies and individuals as related parties of the Company for the year ended 31st March 2010 for the purposes of reporting as perAS-18 (Related Party Transaction)

P. Related party relationships

Subsidiary Companies

M/s Euro Plast Limited, U.K. M/s Sacos Indigo Private Limited

Associate Company

M/s.Panam Packers Pvt. Ltd. M/s Synergy Education Intl.(P) Ltd. M/s Vishwkarma Creations (P) td. M/s Olympi an Investors and Traders Pvt. Ltd.

Key Management Personnel:

Mr.Sunil Trivedi Mr.Kailash Chandra Trivedi Mr.Pradhuman Sharma Mr. Shrawan Kumar Patodi Mr. Ladharam Patel Mr. Dashrath Bhai Trivedi Mr. Sanjay Trivedi Mr. Rolland Coderre

Relatives of Key Management Personnel:

Mrs.Nandita Trivedi

Mr.Utkarsh Trivedi

Mrs. Rupal Trivedi

Q. Debit and Credit balances are subject to confirmation.

R. Figure has been rounded off to the nearest rupees.

S. Figures of the previous year have been re-grouped/re-arranged/re-classified wherever necessary to the facilitate comparison.

 
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