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Notes to Accounts of NHC Foods Ltd.

Mar 31, 2015

1. Share Capital

(a) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of 10/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the Annual General meeting.

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

(b) The Company does not have a holding company.

(c) Aggregate number and class of shares allotted as fully paid-up pursuant to scheme of amalgamation without payment being received in cash.

The Company allotted 22,00,750 equity shares of 10/- each and 70,42,400 0% Optionally Convertible Redeemable Preference Shares of 10/- each in pursuance of scheme of amalgamation without payment being received in cash during the year ended March 31, 2011.

2. Contingent Liabilities not provided for :

(Amount in Rs. )

Particulars 2014-15 2013-14

A. Bill discounted and outstanding 9,04,73,727 5,86,63,680

B. Bank Certificate for cancelled - - guarantee

C. Disputed Demands Outstanding:*

Income Tax 5,47,469 5,47,469

Excise Duty 2,26,871 2,26,871

* Based on the decisions of the Appellate authority and interpretation of other provision, the company has legally advised that demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

3. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Nil (2014: Nil)

4. There are no Micro, Small and Medium Enterprises, to whom the Company over dues which are outstanding for more than 45 days as at March 31,2015 and no interest payment during the year to any Micro, Small and Medium Enterprises. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the auditors.

5. Company operates in a single business segment. However it operates both in Indian and international markets. Accordingly information required under AS - 17 "Segment Reporting" pertaining to geographical segment is as under :

6. Leases

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligations under non-cancellable operating lease for the period less than 1 year is 1,50,000/- (2014 : Nil).

7. During the year, 35,96,400 0% Optionally Convertible Preference Shares of 10/- each were converted into 35,96,400 Equity Shares of 10/- each.

8. As of balance sheet date, the company has net foreign currency exposures (In USD) that are not hedged by derivative instruments or otherwise amounting to Nil (2014: NIL).

9. Related Party Disclosure:

Disclosures as required by the Accounting Standard 18 "Related Party Disclosure" is given below:

a) List of Key Management Personnel and Relatives

Key Management Personnel

Mr. Apoorva H. Shah - Managing Director

Mrs. Alpa A. Shah - Whole time Director

Company over which key management personnel are able to exercise significant influence

NHC Mercantile Private Limited

b) Disclosure in respect of material Related Party Transactions during the year:

(i) Loan Taken includes from Mr. Apoorva H. Shah 3,67,00,000 (2014: 12,000).

(ii) Repayment of Loans taken includes to Mr. Apoorva H. Shah Rs. 1,27,56,016 (2014: 38,74,043).

(iii) Remuneration includes to Mr. Apoorva H. Shah 42,25,450 (2014: 29,17,404) and to Mrs. Alpa

A. Shah 42,25,450 (2014: 29,17,404).

10. Previous year figures have been recasted / restated wherever necessary.




Mar 31, 2014

1. Share Capital

(a) Terms/rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian Rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the Annual General meeting.

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

(b) Terms of conversion/redemption of preference shares

0% Optionally Convertible Preference Shares (OCPRS) of Rs. 10/- each shall be converted into equity shares in the ratio of 1:1 in one or more tranches within a period of five years from the date of allotment in such a manner that the requirements of Clause 40A of the listing agreement is met at all times. The OCPRS, if not converted in equity shares, either fully or partly within the said period of five years, shall be compulsorily redeemed within the period of subsequent five years in one or more tranches.

(c) Aggregate number and class of shares allotted as fully paid-up pursuant to scheme of amalgamation without payment being received in cash.

The Company allotted 22,00,750 equity shares of Rs. 10/- each and 70,42,400 0% Optionally Convertible Redeemable Preference Shares of Rs. 10/- each in pursuance of scheme of amalgamation without payment being received in cash during the year ended March 31, 2011.

2.Long Term Borrowings

(i) Term loan from bank is secured by hypothecation of land and building, plant and machinery, and personal guarantee of directors; carries rate of interest of 12% to 12.40% and is repayable in 2015-16 Rs. 1,10,84,135; 2016-17 Rs. 49,99,992 ; 2017-18 Rs. 49,99,992 ; and 2018-19 Rs. 35,79,103.

(ii) Unsecured loans from Bank carries rate of interest 13% is repayable in 2015-16 Rs. 5,10,213 and unsecured loans from others carries rate of interest of 18.80% and is repayable in 2015-16 Rs. 10,00,000.

(iii) Loans and advances from related party carries interest rate of 10% and is repayable in 2015-16.

3. Short Term Borrowings

(i) Working Capital Borrowings from Banks is secured against stock-in-trade includes cash credit facilities, carries rate of interest 12.25% and Packing Credit carries rate of interest Libor 2.5%.

(ii) Other loans carries rate of interest 15% to 16.8% p.a.

4. Contingent Liabilities not provided for :

(Amount in Rs.)

Particulars 2013-14 2012-13

A. Bill discounted and outstanding 5,86,63,680 5,55,88,072

B. Bank Certificate for cancelled - 36,22,494 guarantee C. Disputed Demands Outstanding:*

Income Tax 5,47,469 5,47,469 Excise Duty 2,26,871 2,26,871

* Based on the decisions of the Appellate authority and interpretation of other provision, the Company has legally advised that demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

5. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (2013: Rs. 6,01,250/-)

6. There are no Micro, Small and Medium Enterprises, to whom the Company over dues which are outstanding for more than 45 days as at March 31, 2014 and no interest payment during the year to any Micro, Small and Medium Enterprises. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the auditors.

7. Company operates in a single business segment. However it operates both in Indian and international markets. Accordingly information required under AS - 17 "Segment Reporting" pertaining to geographical segment is as under:

8. Leases

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligations under non-cancellable operating lease is Rs. Nil (2013 : Nil).

9. During the year, 19,03,600 0% Optionally Convertible Preference Shares of Rs.10/- each were converted into 19,03,600 Equity Shares of Rs. 10/- each.

10. As of balance sheet date, the company has net foreign currency exposures (In USD) that are not hedged by derivative instruments or otherwise amounting to Rs. Nil (2013: Rs. 1,16,25,512).

11. Related Party Disclosure:

Disclosures as required by the Accounting Standard 18 "Related Party Disclosure" is given below:

a) List of Key Management Personnel and Relatives

Key Management Personnel

* Mr. Apoorva H. Shah - Managing Director

* Mrs.Alpa A. Shah - Whole time Director

Related party to Key Management Personnel

* Miss. Aneri Shah - (Daughter of Alpa and Mr. Apoorva Shah)

Company over which key management personnel are able to exercise significant influence

* NHC Mercantile Private Limited

c) Disclosure in respect of material Related Party Transactions during the year:

(i) Loan Taken includes from Mr. Apoorva H. Shah Rs. 12,000 (2013: Rs. 1,17,30,000).

(ii) Repayment of Loans taken includes to Mr. Apoorva H. Shah Rs. 38,74,043 (2013: Rs. 87,03,869).

(iii) Remuneration includes to Mr. Apoorva H. Shah Rs. 29,17 404 (2013: Rs. 29,17,404) and to Mrs. Alpa A. Shah Rs. 29,17,404 (2013: Rs. 29,17,404).

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such a supply and demand in the employment market.

Disclosure relating to experience adjustments has not been provided in the absence of relevant information.

12. Previous year figures have been reclassified to conform to this year''s classification.


Mar 31, 2013

Note 1: Contingent Liabilities not provided for :

(Amount in Rs.) Particulars 2012-13 2011-12

A. Bill discounted and outstanding 5,55,88,072 6,65,76,051

B. Guarantees given to Spice Board 36,22,494 36,22,494

C. Disputed Demands Outstanding:*

Income Tax 5,47,469 5,47,469

Excise Duty 2,26,871 2,26,871

*Based on the decisions of the Appellate authority and interpretation of other provision, the Company has legally advised that demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 6,01,250/- (2012: Rs. 8,01,000/-).

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

4. Company operates in a single business segment. However it operates both in Indian and international markets. Accordingly information required under AS – 17 "Segment Reporting" pertaining to geographical segment is as under:

5. Related Party Disclosure:

Disclosures as required by the Accounting Standard 18 "Related Party Disclosure" is given below:

a. List of Key Management Personnel and Relatives Key Management Personnel

- Mr. Apoorva H. Shah

- Mrs. Alpa A. Shah

Related party to Key Management Personnel

- Miss. Aneri Shah

Company over which key management personnel are able to exercise significant influence

- NHC Mercantile Private Limited

c) Disclosure in respect of material Related Party Transactions during the year:

(i) Loan Taken includes from Mr. Apoorva H. Shah Rs. 1,17,10,000 (2012: X 1,70,75,990) (ii) Repayment of Loans taken includes to Mr. Apoorva H. Shah Rs. 87,03,869 (2012: Rs. 1,38,34,421) (i) Remuneration includes to Mr. Apoorva H. Shah Rs. 29,17,404 (2012: Rs. 29,17,404) and to Mrs. Alpa A. Shah X 29,17,404 (2012: Rs. 29,17,404).

6. Leases:

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligations under non - cancellable lease is X Nil (2012: Nil)

7. As of balance sheet date, the Company has net foreign currency exposures (in USD) that are not hedged by derivative instruments or otherwise amounting to Rs. 1,16,25,512 (2012: Rs. 264,33,075).

8. During the period, Company has allotted 10,00,000 Equity Shares of X 10/- at a premium of Rs. 12.60/- on preferential basis.

9. During the year, 15,42,400 0% Optionally Convertible Preference shares of Rs. 10/- each were converted into 15,42,400 Equity Shares of X 10/- each.

10. Previous year''s figures have been regrouped / reclassified wherever necessary to correspond with the Current year''s classification/disclosure.


Mar 31, 2012

Note 1: Contingent Liabilities not provided for

(Rs. in Lacs)

Particulars 2011-12 2010-11

A. Bills discounted and outstanding 665.76 489.97

B. Guarantees given to Spices Board 36.23 36.23

* The disputed demand outstanding of Rs. 5.47 lacs towards Income tax and Rs. 2.27 lacs towards Service tax. Based on the decisions of the Appellate authority and interpretation of other provision the company has legally advised that demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 8.01 Lacs (2011: Rs. 30.17 lacs).

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

4. Company operates in a single business segment. However it operates both in Indian and international markets. Accordingly information required under AS - 17 "Segment Reporting" pertaining to geographical segment is as under:

5. Related Party Disclosure:

Disclosures as required by the Accounting Standard 18 "Related Party Disclosure" is given below: a. List of Key Management Personnel and Relatives

Key Management Personnel

- Mr. Apoorva H. Shah

- Mrs. Alpa A. Shah

Related party to Key Management Personnel

- NIL

Company over which key management personnel are able to exercise significant influence

- NHC Mercantile Private Limited

c. Disclosure in respect of material Related Party Transactions during the year:

(i) Loan Taken includes Mr.Apoorva H. Shah Rs. 170.76 Lacs (2011 Rs. 148.61 Lacs), Mrs. Alpa A. Shah Rs. 2.50 Lacs (2011 Rs. 53.00 Lacs).

(ii) Repayment of Loans taken includes Mr. Apoorva H. Shah Rs. 138.34 Lacs (2011 Rs. 84.24 Lacs), Mrs. Alpa A. Shah Rs. 3.55 Lacs (2011 Rs. 47.50 Lacs).

(iii) Repayment of deposit taken includes Mr. Apoorva H. Shah Rs. NIL. (2011 Rs. 145.00 Lacs).

(iv) Sales includes NHC Mercantile Private Limited Rs. 24.95 lacs (2011 Rs. NIL).

6. Operating Lease Obligation

The Company has entered into operating lease arrangements for premises. The future minimum lease rental obligations under non-cancellable operating lease is Rs. Nil (2010: Nil).

7. Employee Benefits

The Amount recognized in the Company's financial statements as at the year-end is as under:

8. These financial statements have been prepared in the format prescribed by the Revised Schedule VI to the Companies Act, 1956. Previous year's figures have been recasted/restated.


Mar 31, 2010

1.1 AMALGAMATION

During the year, a composite scheme of amalgamation between the Company and M/s NHC Industries Private Limited (the amalgamating company) under Section 391 to 394 and other provisions of Companies Act, 1956 was filed in the High Court of Judicature at Bombay.

NHC Industries Private Limited was carrying on the business of exports of oil seeds, spices powder, pulses, sugar and wide range of agricultural food products and was also engaged in trading on commodity exchange, import of pulses, spices etc. and sale in local market.

Under the scheme, entire assets and liabilities of NHC Industries Private Limited were to vest with the company with effect from April 1, 2009 (Appointed Date). The said scheme was approved by the Honble High Court of Judicature at Bombay on August 13, 2010. The Company filed the certified copy of the Court order approving the scheme with the Registrar of Companies (ROC), Bombay on September 7, 2010 (Effective Date) as required under the applicable provisions of the Companies Act, 1956. Accordingly, the said scheme became effective from the Appointed Date on April 1, 2009.

The method of accounting employed by the Company is the pooling of interest method.

Salient feature of the Scheme are as under:

(a) With effect from April 1, 2009 (Appointed Date), all assets and liabilities of NHC Industries Private Limited shall be transferred and vested in the Company as a going concern.

(b) In consideration of the scheme, the Company will issue:

(i) 22,00,750 Equity shares of face value of Rs 10/- each fully paid up aggregating to Rs. 2,20,07,500 to the equity shareholders of NHC Industries Private limited ; and

(ii) 70,42,400 Optionally Convertible Preference shares of Rs 10/- each fully paid up aggregating to Rs 7,04,24,000 to the Equity shareholders of the NHC Industries Private Limited.

Pending issue of these equity and preference shares, a sum of Rs 9,24,31,500 has been shown as Share Capital pending allotment.

Accounting (As per approved Scheme)

(i) The Company has recorded all the assets and liabilities of the amalgamating company at the respective values appearing in their books.

(ii) Loans and Advances and other dues outstanding between the Company and the amalgamating company are cancelled.

(iii) The difference of Rs 76,696,032/- between Shares to be issued by the Company pursuant to the amalgamation scheme and the net assets of the amalgamating company acquired are shown as Goodwill on amalgamation.

(iv) All costs, charges, taxes including duties, levies and all other expenses arising out of, or incurred in carrying out and implementing the scheme aggregating to Rs 18,70,532 are debited to Goodwill Account.

1.2 CONTINGENT LIABILITY

Bills discounted and outstanding Rs. 28,014,916 ( P.Y- Nil)

In respect of possible warranty claims, if any, that may arise for products sold and services rendered in earlier years. However, these shall be accounted for in the year in which the claims are settled.

There was a raid of the Excise Department. Certain objections were raised, duty was assessed for 1992 to 1995 by the Department and demand was raised of Rs. 16,06,916 for duty and penalty. The company, thereafter, filed an appeal with the Appellate Tribunal. The judgment of the Tribunal has been delivered on 23.06.1998 setting aside the original assessment order. Fresh assessment has not yet been done. The amount of contingent liability, if any, in respect of this is not ascertainable.

Income Tax demand of Rs 5,47,469 ( 2009 : 5,47,469) for AY 1996-97 where the ITAT Mumbai Bench : "B" has vide its order dated 26th July, 2004 referred back the matter to A.O. to decide the claim of the Assesses after offering adequate opportunity of hearing.

1.3 The balances of Sundry Debtors, Loans & Advances and Sundry Creditors are subject to confirmation and consequential reconciliation/adjustments arising there from, if any. The management, however, does not expect any material variation.

1.4 During the year on August 14, 2009, shareholders of the company by passing a special resolution decided to reduce the paid up equity share capital of the company, to which High Court of Bombay has given its approval on October 9, 2009. Accordingly, the existing Share Capital of 30,01,100 equity shares of Rs 10/- each was cancelled and replaced by 10,50,385 equity shares of Rs. 10/- each bearing new series from 01 to 10,50,385. The Capital Reduction Account of Rs. 1,95,07,150/- was adjusted against earlier years losses of Rs. 3,13,22,234/- and expenses on account of professional fees of Rs. 18,70,532/- were charged to Profit and Loss Account for the year under head "Goodwill Account".

1.5 Future interest liability in respect of assets of the value of Rs.14,32,451 (2009 : Rs. Nil ) is Rs. 5,468 (2009 : Rs. Nil)

1.6 Secured loans include a sum of Rs.90,00,000 (2009 : Rs.Nil) repayable before 31st March 2011.

1.7 In the opinion of the board, the current assets, loans and advances are approximately of the value stated, if realized in the ordinary course of the business. The provision for all known liabilities is adequate and not in excess of the amount considered reasonably necessary.

1.8 The Company operates in a single business and geographical segment. Hence information required under Accounting Standard 17, Segment Reporting, issued by the Council of the Institute of Chartered Accountants of India, has not been given.

1.9 Related Party Disclosure:

Disclosures as required by the Accounting Standard 18 "Related Party Disclosure" is given below:

a) List of Key Management Personnel and Relatives

Key Management Personnel

Mr. Himatlal H. Shah

Mr. Apoorva H. Shah

Mrs. AlpaA. Shah

Mr. Amit Shah

Related party to Key Management Personnel

A.H.Shah (HUF)

Amit Shah

Hansa Shah

H. H. Shah (HUF)

(b) Transaction with related Parties

1.10 Earnings per Share (EPS)

1.11 Deferred Tax Liability / Asset

1.12 Employee Benefits

Since the Company has not funded its gratuity liability and leave encashment, there are no returns on the planned assets and hence the details related to changes in fair value of assets have not been given.

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

1.13 Sales, Purchase, Opening & Closing Stock

1.14 Value of Imports (on CIF)

1.15 Expenditure in Foreign Currency

1.16 Earnings in Foreign Currency: Rs. 644,814,132 (2009:- Nil)

1.17 Licensed Capacity:

The Company is not required to obtain any license under Industries (Development & Regulation) Act, 1951, therefore legal licensed capacity is not applicable.

1.18 Other clauses of paragraph 3, 4C, 4D of part II of Schedule VI of the Companies Act, 1956 are not applicable to the company during the year.

1.19 Previous years figures are regrouped wherever necessary.

 
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