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Notes to Accounts of Nutraplus India Ltd.

Mar 31, 2016

Note:

3.a.i Term loans availed from the Banks are secured against the equitable mortgage of office premises (Mumbai), factory land , factory building , plant & machinery situated at MIDC, Tarapur, Maharashtra and motor cars. And further secured against the personal guarantee of two directors and two guarantees of related parties to the extent of mortgaged collateral securities and corporate guarantee of group concern.

Notes:

i. Working capital loan availed from The Saraswat Co-op Bank Ltd is secured by way of hypothecation of stock and debtors. During the year, the Company had availed an additional working capital loan from bank amounting to Rs. 400 Lakhs.

ii. Details of short-term borrowings guaranteed by some of the Directors is as follows:

i. Intangible assets representing goodwill is arrived at after taking all assets and liabilities of 100% subsidiary Company viz. Dynamic Metal Powders Private Limited in compliance of Accounting Standard 14 related to Accounting of Amalgamation pursuant to H''ble High Court Order, Mumbai dated 3 May 2013. In terms of the said Order, the said merger is effective from the appointed date 1 April 2012.

ii. The addition of fixed assets & CWIP include the interest capitalized during construction period for Rs. 2,45,68,735/= (Previous year Rs. 62,02,899/=) for details refer to Note No.27.4 under disclosure of Significant accounting policies & practices

iii. Vehicles are in the personal name of Director.

iv. Owing to the fire accident, the Company has lost various historical data related to original cost of various fixed assets located at plant along with the updated fixed asset register maintained at the plant. The Company is in under process of preparing the item wise fixed assets register, however the Company has maintained the full information required for the preparation of fixed asset register.

(i) Salaries and wages include: Salaries, wages, bonus, compensated absences and all other amounts payable to employees in respect of services rendered as per their employment terms under a contract of service / employment.

(ii) The employee''s provident fund Rules are not applicable to the Company, as the Company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules. The Companies own staff is outside the limit set out by the provident fund Rules.

(iii) The gratuities liability is accounted for as per actuarial valuation.

1. Significant accounting policies & practices

2. Accounting convention

These financial statements have been prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP) under the historical cost convention on accrual basis, Pursuant to section 133 of the Companies Act, 2013 read with Rule 7 of the Companies (Accounts) Rules, 2014, Till the standards of accounting or any addendum thereto are prescribed by Central Government in consultation and recommendation of the National Financial Reporting Authority, the existing Accounting Standards notified under the Companies Act, 1956 shall continue to apply. Consequently, these financial statements have been prepared to comply in all material aspects with the accounting standards notified under Section 211(3C) of Companies Act, 1956 [Companies (Accounting Standards) Rules, 2006, as amended] and other relevant provisions of the Companies Act, 2013. “The Ministry of Corporate Affairs (MCA) has notified the Companies (Accounting Standards) Amendment Rules, 2016 vide its notification dated 30 March 2016. The said notification read with Rule 3(2) of the Companies (Accounting Standards) Rules, 2006 is applicable to accounting period commencing on or after the date of notification i.e. 1 April 2016" All the assets and liabilities have been classified as current or non current as per the Company''s normal operating cycle and other criteria set out in Schedule III to the Companies Act, 2013.

3. Revenue recognition

Revenue from sales is recognized on transfer of significant risks and rewards of ownership to customers based on the contract with the customers for delivery.

4. Use of estimates:

The preparation of financial statements requires estimates and assumptions to be made that affect the reported amount of assets and liabilities on the date of the financial statements and the reported amount of revenues and expenses during the reported period. Difference between the actual results and estimates are recognized in the period in which the results are known / materialized.

5. Tangible fixed assets

Fixed assets are carried at cost less accumulated depreciation and impairment losses, if any. The cost affixed assets includes interest on borrowings attributable to acquisition of qualifying fixed assets up to the date the asset is ready for its intended use and other incidental expenses incurred up to that date. Exchange differences arising on restatement / settlement of long-term foreign currency borrowings relating to acquisition of depreciable fixed assets are adjusted to the cost of the respective assets and depreciated over the remaining useful life of such assets. Machinery spares which can be used only in connection with an item of fixed asset and whose use is expected to be irregular are capitalized and depreciated over the useful life of the principal item of the relevant assets. Subsequent expenditure relating to fixed assets is capitalized only if such expenditure results in an increase in the future benefits from such asset beyond its previously assessed standard of performance.

6. Capital work-in-progress:

Projects under which assets are not ready for their intended use and other capital work-in-progress are carried at cost comprising direct cost, related incidental expenses and attributable interest.

Intangible fixed assets:

Intangible assets are recognized through business combination and accounted as per Accounting standard 14 viz. Accounting for Amalgamation.

Depreciation:

Depreciation of Fixed Assets is charged on ''Straight Line Method'', over the estimated useful life of assets in the manner prescribed in schedule II of the Act.

Cost of Leasehold Land is amortized over the period of lease

Goodwill arised on merger is amortized over a period of five years thereof.

Depreciation on additions to assets or on sale/discardment of assets, is calculated pro rata from the date of such addition or up to the date of such sale/ discardment, as the case may be.

7. Impairment of Assets:

An asset is treated as impaired when the carrying cost of assets exceeds its recoverable value. An impairment loss is charged to the Profit and Loss Account in the year in which an asset is identified as impaired. The impairment loss recognized in prior accounting period is reversed ifthere has been a change in the estimate of recoverable amount.

8. Investments:

Long-term investments (excluding investment properties), are carried individually at cost less provision for diminution, other than temporary, in the value of such investments. Current investments are carried individually, at the lower of cost and fair value. Cost of investments include acquisition charges such as brokerage, fees and duties.

9. Inventories:

Inventories of Raw Materials, Work-in-Process, Stores and spares, Finished Goods and Stock-in-trade are stated ''at cost or net realizable value, whichever is lower''. Goods-in-Transit are stated ''at cost''. Cost comprise all cost of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition. The excise duty in respect of closing inventory of finished goods is included as part of finished goods. Cost formulae used are ''First-in-First-out'', ''Weighted Average cost'' or ''Specific identification'', as applicable. Due allowance is estimated and made for defective and obsolete items, wherever necessary, based on the past experience of the Company.

10. Employee benefits:

i. Gratuities liabilities are worked out as per Actuarial Valuation under defined benefit plan.

ii. The employee''s provident fund Rules are not applicable to the Company, as the Company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules. The Companies own staff is outside the limit set out by the provident fund Rules.

11 Taxes on Income:

Current tax

Provision for Income Tax is determined in accordance with the provisions ofthe Income TaxAct, 1961.

Deferred tax provision

Deferred tax assets and liabilities arising on account of timing differences, being the difference between the taxable income and the accounting income that originate in one period and are capable of reversal in one or more subsequent periods, are recognized using the tax rates and tax laws that have been enacted.

27.11 Borrowing cost

Borrowing costs that are attributable to the acquisition or construction of qualifying assets are capitalized as part of the cost of such assets A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowing costs are charged to revenue.

27.12 Foreign Currency Transactions:

Transactions in foreign currencies, to the extent not covered by forward contracts, are accounted at exchange rates prevailing at the time of the transactions are affected and expressed at the year-end exchange rates. Any other exchange differences except relating to Fixed Assets are dealt with in the Profit and Loss Account. Non-monetary foreign currency items, if any, are carried at cost.

27.13 Provision, Contingent Liabilities and Contingent Assets:

Provision involving substantial degree of estimation in measurement is recognized when there is present obligation as result of past events and it is probable that will be an outflow of resources. Contingent Liabilities are not recognized but are disclosed in the notes.

27.14 Cash and cash equivalents (For purposes of Cash Flow Statement)

Cash comprises cash on hand and demand deposits with banks. Cash equivalents are short-term balances (with an original maturity of three months or less from the date of acquisition), highly liquid investments that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value.

27.15 Cash Flow Statement

Cash flows are reported using the indirect method, whereby profit / (loss) before extraordinary items and tax is adjusted for the effects of transactions of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from operating, investing and financing activities of the Company are segregated based on the available information.

27.16 Earnings per share

Basic earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) by the weighted average number of equity shares outstanding during the year. Diluted earnings per share is computed by dividing the profit / (loss) after tax (including the post tax effect of extraordinary items, if any) as adjusted for dividend, interest and other charges to expense or income relating to the dilutive potential equity shares, by the weighted average number of equity shares considered for deriving basic earnings per share and the weighted average number of equity shares which could have been issued on the conversion of all dilutive potential equity shares. Potential equity shares are deemed to be dilutive only if their conversion to equity shares would decrease the net profit per share from continuing ordinary operations. Potential dilutive equity shares are deemed to be converted as at the beginning of the period, unless they have been issued at a later date. The dilutive potential equity shares are adjusted for the proceeds receivable had the shares been actually issued at fair value (i.e. average market value of the outstanding shares). Dilutive potential equity shares are determined independently for each period presented.

27.17 Insurance Claims

Insurance claims are accounted for on the basis of claims admitted / expected to be admitted and to the extent that there is no uncertainty in receiving the claims.

27.18 Service tax input credit

Service tax input credit is accounted for in the books in the period in which the underlying service received is accounted and when there is no uncertainty in availing / utilizing the credits.

i. The provident fund Rules are not applicable to the Company, as the Company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules.

ii. The employee state insurance scheme does not apply to the employee''s of the Company during the year. However Company has taken Medical Group Insurance Policy for the employees.

28.3 Segment Reporting

a. Basis of Preparation

In accordance with the requirements of Accounting Standard - 17 “Segment Reporting", the Company''s business activities can be classified into two segment namely Active Pharma Ingredients & Intermediates and Pharma Equipments. The information about all the segments are given below.

30.6 Exceptional items

During the year the Company has received the maturity of keyman insurance policy amounting to Rs. 118.75 crores, which was taken on Managing Director of the Company, and the same has been reflected as an Exceptional Item.

30.7 Proposed Dividend

A maiden dividend of Re. 0.50 per Equity Share of Rs. 10/- each (i.e. 5%) for the financial year ended 31 March, 2016 has been recommended, subject to approval of shareholders in the ensuing AGM. Cash outflow on account of dividend including taxes will be Rs. 80.25 Lakhs (including share warrants converted post the balance sheet date).

30.8 Disclosure required in terms of Regulation 32 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

The Company has utilized the entire proceeds of warrants and shares issue towards the objects as mentioned in the offer document.

30.9 The debit and credit balances in the accounts of contractors, suppliers and debtors are subject to on receipt of confirmation and reconciliation.

30.10 In the opinion of the Board and to the best of their knowledge and belief, the value of realization of current assets, loans & advances, in the ordinary course of business would not be less than amount at which they are stated in the Balance sheet.

30.11 DISCLOSURE IN ANNUAL REPORT REGARDING PARTICULARS OF COST AUDITOR

Pursuant to section 148 of Companies Act 2013 & section 233B of the erstwhile Companies Act, 1956, the Company is required to carry out an audit of cost record relating to manufacturing activities of bulk drug & API products covered under Pharmaceutical Industry in terms of Central Government Order dated 2 May, 2011 every year. The Company has appointed M/s Gaurang Dalal, Cost Accountants, of Mumbai as Cost Auditors, with due approval of the Central Government, to audit the cost accounts of the Company for the financial year ending on 31 March, 2012, 31 March, 2013 and 31 March 2014. & M/s C. G. Pampat & Co, Cost Accountants, of Navi Mumbai as Cost Auditors for the financial year ending on 31 March, 2015 and 31 March, 2016. The particulars are as follows: Cost Auditor''s audit report for the Financial Year 2012-13, 2013-14 & 2015-16 is yet to be filed and the said report for financial year 2011-12 & 2014-15 is under process.

The Company was on verge of finalizing the cost audit report for financial year 2011-12 onwards, however the documents, data & related information necessary for finalizing the Cost audit were destroyed by fire. The Company could not complete the cost audit on account of fire incident.

30.12 On 3 August 2014, fire was occurred at N-92 Plant at Tarapur, Boisar, Dist: Thane. The Company had filed claim with the insurance company and it is in the advance stage of settlement. Owing to the incident of fire in the previous year, the operations of the Company for current financial year are not comparable with the previous year.

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


Mar 31, 2015

1. Details of unutilised amounts out of issue of securities made for specific purpose

In the current year, Equity Share Application & share warrant application money is received and is kept in the separate bank account.

2. Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

There are no loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such parties.

3. The debit and credit balances in the accounts of contractors, suppliers and debtors are subject to on receipt of confirmation and reconciliation.

4. In the opinion of the Board and to the best of their knowledge and belief, the value of realisation of current assets, loans & advances, in the ordinary course of business would not be less than amount at which they are stated in the Balance sheet

5. DISCLOSURE IN ANNUAL REPORT REGARDING PARTICULARS OF COST AUDITOR

Pursuant to section 148 of Companies Act 2013 & section 233B of the erstwhile Companies Act, 1956, the company is required to carry out an audit of cost record relating to manufacturing activities of bulk drug & API products covered under Pharmaceutical Industry in terms of Central Government Order dated 2nd May, 2011 every year. The company appointed M/S Gaurang Dalal, Cost Accountants, of Mumbai as a Cost Auditors, with due approval of the Central Government, to audit the cost accounts of the Company for the financial year ending on 31st march, 2012, 31st March, 2013 and 31st March 2014.The particulars are as follows: Cost Auditor's audit report for the Financial Year 2011 - 12, 2012-13, 2013-14 is yet to be filed and the said report for financial year 2014-15 is under process.

The Company was on verge of finaling the cost audit report for financial year 2011-12 onwards, however the documents, data & related information necessary for finalising the Cost audit were destroyed by fire. The Company could not complete the cost audit on account of fire incedent.

On 3rd August' 2014, fire occurred at N 92 plant at Tarapore, Boisar, Dist: Thane. The extraordinary items referred in the profit & loss account reflect the the loss by fire net of claim receivable account. The Capital loss is for Rs. 19,56,24,933/=, inventory loss for Rs. 8,50,23,646, reversal of excise duty on account of remission for Rs. 61,87,893/= and other incidental expenses for Rs. 27,06,386 aggregating to Rs. 28,95,43,058/=. The Company has estimated insurance claim receivable from insurance Company for Rs. 25,81,53,000/= Accordingly, the net loss is recognised for Rs. 3,13,90,058/= under extra ordinary items. The Company has filed the claim with surveyor at the instruction of insurance Company and the matter is under process. The surveyor is in the process of measuring the claim, as the said losses are reported as per Company's estimate. To refrain the impact of production & sales loss that would have had surely been casted on the future months on production & sales, the management of the Company took the immediate corrective steps by implementation of expansion project within three months & tieing up the with the job work. The Company could retrieve the normal operation after three months of fire incidents.

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


Mar 31, 2013

1 Corporate information

The Company is presently manufacturing bulk drug products and their intermediates, human Active Pharma ingredients (API) products. In the current year, the Company has achieved the manufacturing sale of Rs. 41,11.29,628/= and by way of job process activities of manufacturing various API of reputed Companies for Rs. 2,09,88,215/=. The manufacturing facilities are located at MIDC, Tarapore, District, Thane and all other activities are carried on from the Registred office located at Mumbai.

2.1 Employee benefit:

I. Gratuities liabilities are worked out as per own estimates. The actuary valuer is yet to I be appointed and accordingly Company will fund the defined contribution plan. Since the Company has 15 employees, the amount is not material.

ii. The provident fund Rules are not applicable to the Company, as the Company employs the contracted laour for production and the contractor is deducting the dues as per provident fund rules

The Companies own staff is outside the limit set out by the Provident fund Rules. iii.The employee state insurance scheme does not apply to the employee''s of the Company during the year.

2.2 Accounting Standard 14: Accounting for Amalgamation

a. The Company has acquired its 100% subsidiary vz. Dynamic Metals Powder Private Limited. The said subsidiary Company is taken over with all assets & liabilities at their book value. No fresh capital is issued on account of merger, as Company is 100% subsidiary. The object for taking over of the Company is on account of industrial plot situated in same vicinity and similar line of activity can be carried out for taking up the further expansion of the parent Company by saving the administrative cost and better control.

b. The Company is merged on the basis of Hon''able High Court, Mumbai Order dated 3rd May''2013. The appointed date is from 1 st April" 2012.

c. The account is merged with the Company and as per the guideline of Accounting Standard 14 relating to Accounting for Amalgamation. All the assets and liabilities is booked in the Company''s account and the investment in subsidiary account and common balances are eliminated. The good will is created out of the merger and it is arrived for Rs. 1,64,19,842/=. It will be amortised for the period of five years as contemplated in AS 14.

d. The variance in the policy are worked out and the uniformity with the parent Company''s is effected and recognised in the books of account for details referto Note 10.2 of fixed assets.

3.1 Details of unutilised amounts out of issue of securities made for specific purpose

In the current year, share warrant application money is received and is kept in the bank account.

3.2 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Amounts dues to Micro and Sfyriall Enterprises are not available. However, no amount is paid as interest for the late payments, which are exceeding for Rs. 1,00,000/= & overdue.

3.3 Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

There are no loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such parties.

3.4 The debit and credit balances in the accounts of contractors, suppliers and debtors are subject to confirmation and reconciliation.

3.5 In the opinion of the Board and to the best of their knowledge and belief, the value of realisation of current assets, loans & advances, in the ordinary course of business would not be less than amount at which they are stated in the Balance sheet

3.6 DISCLOSURE IN ANNUAL REPORT REGARDING PARTICULARS OF COST AUDITOR

Pursuantto section 233B of the companies Act, 1956, the company is required to carry out an audit of cost record relating to manufacturing activities of bulk drug & API products covered under Pharmaceutical Industry in terms of Central Government Order dated 2nd May, 2011 every year. The company appointed M/SGaurang Dalai, CostAccountants, of Mumbai as a Cost Auditors, with due approval of the Central Government, to audit the cost accounts of the Company for the financial year ending on 31 st march, 2012 and 31 st March, 2013.The particulars are as follows: Cost Auditor''s audit reportfor the Financial Year 2011-12, which was due tobe filed with the Ministry of Corporate Affairs on 28th February''2013 is yet to be filed and the said report for financial year 2012-13 is under process.

3.7 Previous year''s figures have been regrouped / reclassified wherever necessaryto correspond with the current year''s classification/disclosure. On account of merging of 100% Subsiadiary from appointed date IstApril''2012, the consolidation sttement is not requiredtobe presented and the financial statements are''shown as stanalone basis.


Mar 31, 2012

Note:

1.1 In the financial year 2009-10, the Company had issued 320000 (Three Lakh Twenty Thousand) Equity Shares of Rs. 10/= each fully paid, to the promoter's group on preferential basis under Section 81(1 A) of the Companies Act' 1956. The said shares are in lock-in-period up to 24th March'2013.

Note:

1.a.i Term loan is availed from the bank is secured against the equitable mortgage of office premises, factory land , factory building , plant & machinery. It is also secured against the personal guarantee of one director and Corporate guarantee of group concern. The term loan is repayable in 60 instalments @ the rate of 14% per annum interest or PLR of the bank, whiever is higher.

1.a.ii Unsecured term loan from five NBFC is availed during the current year and will be repayable in 36 instalments. The said loan is availed for capital projects at the rate of 9.5% to 10.5% flat rate of interest. Vehicle loan is availed for 36 instalments at the rate of 11.64% per annum interest and is secured against hypothecation of vehicle.

1.a.iii Loans availed from the above referred related party were taken for the long term working capital requirements. The loan from Gita Naik is interest free and the ICD loan are taken at 12% per annum interest rate, which is not prejudicial to the interest of the Company. The said loans are payable for more than one year period and it is without any specific stipulation.

(i) Salaries and wages include: Salaries, wages, bonus, compensated absences and all other amounts payable to employees in respect of services rendered as per their employment terms under a contract of service / employment.

(ii) The employee's provident fund Rules are not applicable to the Company, as the Company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules. The Companies own staff is outside the limit set out by the provident fund Rules.

(iii) The gratuities is applicable for the first time as previously the number of employees were outside the permissible limit. The said provision is reckoned from the date of joining to year end. Out of the said provision of Rs. 17,35,0000/-, Rs. 16,27,670/= is pertaining to earlier years. However it is not reported under prior period, as it is recognised first time.

2 Corporate information

The Company is presently manufacturing bulk drug products and their intermediates, human Active Pharma ingredients (API) products. In the current year, the Company has achieved the manufacturing sale of Rs. 46,45,77,249/= and by way of job process activities of manufacturing various API of reputed Companies for Rs. 1,65,74,868/=. The manufacturing facilities are located at MIDC, Tarapur, District, Thane and all other activities are carried on from the Registered office located at Mumbai.

2.1 Employee benefit:

i. Gratuities liabilities are worked out as per own estimates. This being the first year, the Company is in process of complying the gratuities Act. The actuary valuer will be appointed and accordingly Company will fund the defined contribution plan. Since the Company has 13 employees, the amount is not material.

ii. The provident fund Rules are not applicable to the Company, as the Company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules. The Companies own staff is outside the limit set out by the Provident fund Rules.

iii. The employee state insurance scheme does not apply to the employee's of the Company during the year.

Note:

During the year the Company has availed the fresh term loan from bank and NBFC for financing the capital projects. The interest during construction period are capitalised during the year includes, building Rs. 50,535/=(Previous Year Rs. 2,32,312), for plant & machinery Rs. 29,39,728/=(Previous year Rs. 773200/=) and processing charges to plant & machinery for Rs. 4,14,986/=. The said interest was initially capitalised to capital work in progress, subsequently, the transferred to particular asset on the date of commission or put to use.

2.2 Related party transactions

2.3 Details of unutilised amounts out of issue of securities made for specific purpose

In the current year, pending number of share warrant has been converted into equity share. It was utilised for the expansion projects and there are no unutilised amount pending against the proceeds of the said share warrant.

2.4 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Amounts dues to Micro and Small Enterprises are not available. However, no amount is paid as interest for the late payments, which are exceeding for Rs. 1,00,000/= & overdue.

3.1 Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

There are no loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such parties.

3.2 The debit and credit balances in the accounts of contractors, suppliers and debtors are subject to confirmation and reconciliation.

3.3 In the opinion of the Board and to the best of their knowledge and belief, the value of realisation of current assets, loans & advances, in the ordinary course of business would not be less than amount at which they are stated in the Balance sheet

3.4 The Company operates only in one segment viz, Bulk drugs and their intermediate products, hence there are no other reportable segments as per the Accounting Standard 17.

3.5 The Revised Schedule VI has become effective from 1 April, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year's figures have been regrouped / reclassified wherever necessary to correspond with the current year's classification / disclosure.


Mar 31, 2010

1. Contingent Liabilities not provided for

(Amount in Rs.)

As at As at 31.03.2010 31.03.2009

a. Pending claim from Commissioner of Workmen Compensation Nil 2,14,000

b. Guarantee given by the bank 25,000 25,000

c. Letter of Credit outstanding Nil 16,67,700

2. (a) Remuneration to the Managing Director paid or provided in accordance with section 198 of the Companies Act, 1956.

(b) Other Directors remuneration Rs. 316050 (Previous Year Rs. 2,36,550)

3. As per normal practice the company has not made the provision for excise duty on goods not cleared and lying in the factory premises at the year-end. The amount has not been included in the valuation of the closing stock. However the said liability, if accounted for, would have no impact on the Profit of the year.

4. During the year, the Company has made Preferential Issue and allotted of 8,25,000 (Eight Lacs Twenty Five Thousand) Optionally Fully Convertible Warrants (Warrants) to the promoter group. Each warrant is convertible into 1 (One) fully paid-up Equity Share of the Company of face value of Rs. 10/= each at an exercise price of Rs. 10/= which is arrived at in accordance with Issue of Capital and Disclosure Requirements Regulations, 2009 of SEBI. The said warrant is convertible at the sole option of the holder thereof, any time before expiry of 18 moths from the date of allotment viz. 22nd March 2010. On allotment of warrants the promoters group have paid Rs. 20,62,500/= being 25% of the total consideration and balance amount will be payable at the time of the conversion of warrant into equity shares.

5. The employees provident fund Rules are not applicable to the company, as the company employs the contracted labour for production and the contractor is deducting the dues as per provident fund rules. As per the further explanation, the companies own staff is outside the limit set out by the Provident fund rules.

The employee state insurance scheme does not apply to the employees of the company during the year. Accordingly, the company does not have any Liability towards retirement benefits in respect of employees, as Company has seven employees on pay roll.

(*) Note :(1) Extraordinary profit is not considered while calculating EPS, however extraordinary losses are considered.

(2) The issue share warrant carrying potential value is not considered for EPS as it is anti-dilutive.

Note: Vet-Pharma Nitro Products Limited has given the corporate guarantee to the extent of loan outstanding in favour of The Saraswat Co-operative Bank Limited in consideration of secured loans sanctioned to the company as per details mentioned in note 10 below. Mukesh Naik, Managing Director is having current account with the Company, which includes expenses reimbursed, credit of salary & rent, advance for expenses etc. and the account is settled at regular interval. The balance as at the year end is Rs. 4,38,021 - Cr. (Previous Year Rs. 1,37,866 - Dr.)

6. A. Secured Loans:

a. Working Capital Loans:

The Company is utilising the working capital loan from The Saraswat Co-operative Bank Limited for Rs.450 lacs on hypothecation of stock and Debtors and balance at the end of the year is Rs. 389.40 Lacs.. (Accrued & Overdue interest Rs. Nil)

b. Term Loans :

(i) Term Loan from Saraswat Co-operatives Bank Limited sanctioned for 80 lacs and it is outstanding at year end for Rs. 48,08,000/- (Accrued Interest Rs. 57875/-) The said term loan is not hedged.

(ii) The term loan from Saraswat Co-operatives Bank Limited for factory building is outstanding at year end for Rs. 24,00,000/= (Accrued interest Rs. 28843/=). The fresh Term loan was sanctioned from Saraswat Co-operatives Bank Limited for Rs.16,43,600/=.

(iii) The term loan from Saraswat Co-operatives Bank Limited is outstanding at year end for Rs. 1,64,49,950/= (Accrued interest Rs. 1,97,295/=). The fresh Term loan was sanctioned from Saraswat Co-operatives Bank Limited for Rs. 1,45,73,200/=.

It is secured against the equitable mortgage of office premises, factory land & factory building, plant & machinery etc.

In addition, the company has given the personal guarantee of one director and corporate guarantee of group Company Vet-Pharma Nitro Products Limited.

7. The debit and credit balances in the accounts of contractors, suppliers and debtors are subject to confirmation and reconciliation.

8. In the opinion of the Board and to the best of their knowledge and belief, the value of realisation of Current Assets, Loans and Advances, in the ordinary course of business would not be less than the amount at which they are stated in the Balance Sheet.

9. The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amounts unpaid as at the year end together with interest payable under this Act has not been provided in the books. During the Company has not made any payments on account of interest to such creditors. Under the circumstances, the Company could not ascertain interest element of cost to be charged to profit and loss account.

10. Disclosure as per clause 32 of Listing Agreement: Company has no loans & advances in the nature of Loans given to Subsidiaries, Associate and others.

11. The Miscellaneous receipt under other income of Rs.39,594/= include Dividend Rs. 2000/=, Creditors no longer payable Rs. 11,247/=, and Discount Rs. 26,347/=

12. Prior Period Expenses is debited on account of earlier purchases of miscellaneous items for Rs. 51,366/=. The extra ordinary items represents credit of amount of Rs. 23,60,000/= due to assignment of key man insurance policy on the basis of surrender value of LIC policy to Managing Director, Mr. Mukesh Naik. The said assignment is considered as the perquisite amount being part of the Managerial remuneration.

13. Figures of previous years have been regrouped and re- arranged wherever necessary.

14. Details of Capacity, Product manufactured, Turnover, Opening and Closing stock of Finished goods (excluding job work)

Note: Previous year figure is mentioned in the bracket.

V Generic Names of Principal Products/Services of Company

(as Per monetary terms)

1. Item Code No. (ITC Code) 2912

Product Description Meta Bromo Annisole

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