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Notes to Accounts of OCL Iron & Steel Ltd.

Mar 31, 2015

1. Terms of redemption of Preference Shares

Preference Shares will not be redeemed before 10 years & not later than 12 years from the date of allotment i.e. August 2010 at such premium as may be decided by the board of directors in accordance with the provisions of Companies Act, 2013 or any re-enactment thereof.

Details of Secured Loans

1 Term Loan from Allahabad Bank - During the year ,the company defaulted in the payment of its instalment and interest due as on 31.03.2015 which was not paid till 29.05.2015

2 Term Loan from Andhra Bank - During the year, the company defaulted in the payment of its instalment and interest due as on 31.03.2015 which was subsequently made good in the month of April, 2015

3 Term Loan from ICICI Bank - During the year, the company defaulted in the payment of its interest due as on 31.03.2015 which was subsequently made good in the month of May, 2015

4 Term Loan from Karur Vysya Bank - During the year ,the company defaulted in the payment of its instalment due as on 31.03.2015 which was not paid till 29.05.2015

5 Term Loan from State Bank Of Bikaner and Jaipur - During the year ,the company defaulted in the payment of its instalment and interest due as on 31.03.2015 which was not paid till 29.05.2015

6 Term Loan from State Bank of Mysore - During the year, the company defaulted in the payment of its instalment and interest due as on 31.03.2015 which was not paid till 29.05.2015

7 Term Loan from UCO Bank - During the year ,the company defaulted in the payment of its interest due as on 28.02.2015 which was subsequently made good in the month of April,2015 but instalment and interest due as on 31.03.2015 was not paid till 29.05.2015

8 Term Loan from Vijaya Bank - During the year ,the company defaulted in the payment of its instalment and interest due as on 31.03.2015 which was not paid till 29.05.2015

2. Contingencies & Commitments (to the extent not Provided for)

i) Contingent Liabilities Rs. In Lacs

Sr. Particulars For the Year For the No Ended Year Ended 31.3.2015 31.3.2014

i) Disputed Sales tax/VAT/Entry Tax demand (including interest & penalty) 1,403.45 1,313.38 ii) Disputed Excise Demand 307.32 307.32 iii) Bank Guarantees issued by bank on company's behalf 11,995.97 59.41 iv) Letter of credit issued on behalf of company 2,854.14 3,917.09 (outstanding amount)

v) Corporate Guarantee Given to OCL India Limited 403.00 332.00

Total 16,963.88 5,929.20

ii) Commitments Rs. In Lacs

Particulars For the Year For the Year Ended Ended 31.3.2015 31.3.2014

Estimated amount of contracts remaining to be 6,054.80 9,421.20

Executed on capital amount ( Net of advances) 6,054.80 9,421.20

3. Related Party Transaction (AS-18)

A) List of Related Parties and their Relationships

Name of Related Party Relationship

1 Mr. N.K Taori ,Managing Director Key Management Personnel

2 Mr. Birendra Jee, Managing Director Key Management Personnel (w.e.f. April 23, 2015)

3 T.K. Laskar, CFO Key Management Personnel

4 Garima Buildrop Pvt Ltd. Holding company

5 Oriental Iron Casting Limited Subsidiary

6 Aron Auto Limited Subsidiary

7 Rose Fiscal Services Pvt Ltd Subsidiary of Subsidiary

8 Meltron Vincom Pvt Ltd Subsidiary of Subsidiary

9 BS Ispat Limited Subsidiary of Subsidiary

10 Gondwana Ispat Limited Subsidiary of Subsidiary of Subsidiary

11 Krisum Mines Minerals Private Associate Limited (formerly Known as Krisum Auto Components Pvt. Ltd.)


Mar 31, 2014

Note:

Rupee Term Loan of Rs. 75,200 Lacs are secured by way of equitable mortgage on all immovable & immovable properties situated at VIll. Lamloi, P.O Garvana, Rajgangpur, Distt Sundergarh, Orissa ranking pari-passu inter-se save and except the prior charge in favour of banks entire current assets to secure working capital facilities.

Rupee Term Loan of Rs. 40,000 Lacs is secured by way of subservient charge on movable fixed assets of the project situated at VIll. Lamloi, P.O Garvana, Rajgangpur, Distt Sundergarh, Orissa.

External Commercial Borrowing/INR term loan of Rs. 42,069.86 Lacs & Rs 13,500 Lacs respectively, are secured by way of first ranking and exclusive security over all fixed assets of the project situated at Plot No-A-285 Chopanki Industrial Area, Chopanki, Distt-Alwar, Rajasthan and Plot No-SP-256 Industrial Area Kehrani, Distt-Alwar, Rajasthan.

Note : There is no default in repayment of loans and payment of interest as on Balance sheet date.

Note: Working capital facilities are secured by hypothecation of raw material, semi-finished goods, stock-in-process, consumable stores and book debts of the Company.

Note: No loan is given to any directors or other officers of the company.

* Includes subscription money of Rs. 383.71 lacs towards shares in Joint Venture Radhikapur (west) Coal Mining Pvt. Ltd.

Refer Point No. 5 of Significant Accounting Policies for mode of valuation of inventories. *Raw Material Stock includes stock of Sized Iron Ore, Coal, Iron Lumps, Steel Coil etc.

*The company has reimbursed all the amount to OCL India Limited for onward submission on account of cross subsidy and wheeling charges payable by the latter to WESCO .The matter is disputed by OCL in the court and under an arrangement between the two companies OCL India Limited will refund the amount in case of recovery of the amount on favorable judgement. As reported to us, the company. on the basis of the legal advice obtained by them, is reasonably sure of the recovery of the amount and as such the amount has been booked under the head short terms loans and advances instead of booking it as an expense.

Note : 1 Contingencies & Commitments (to the extent not Provided for)

i) Contingent Liabilities Rs. In Lacs

Sr. Particulars For the Year For the Year No Ended Ended 31.3.2014 31.3.2013

i) Disputed Sales tax/VAT/ Entry Tax demand (including interest & penalty) 1,313.38 693.33

ii) Disputed Excise Demand 307.32 307.32

iii) Bank Guarantees issued by bank on company''s behalf 59.41 72.17

iv) Letter of credit issued on behalf of company 3,917.09 313.00 (outstanding amount)

v) Corporate Guarantee Given to OCL India Limited 332.00 -

Total 5,929.20 1,385.82


Mar 31, 2013

Note : 1 Contingent Liabilities not provided for in respect of Rs. In Lacs

Sr. Particulars For the Year Ended For the Year Ended No 31.3.2013 31.3.2012

i) Disputed Sales tax / VAT / Entry Tax demand (including interest & penalty) 693.33 693.33

ii) Disputed Excise Demand 307.32 307.32

iii) Bank Guarantees issued by bank on company''s behalf 72.17 47.17

iv) Letter of credit issued on behalf of company 313.00 6.39 (outstanding amount)

Total 1385.82 1,054.21

Note : 2 Employee Benefits (AS-15 revised) The following data are based on the report of the Actuary. The principal assumptions used in the actuarial valuation are as below:- Discount rate 8.30% Expected rate of future salary increase 10.00%

Note : 3 Related party Transaction (AS-18)

A) Related parties and their relationships

i) Key Managerial Persons (KMP) N.K Taori ( Managing Director)

ii) Garima Buildprop Pvt. Ltd. (Holding Company)

Oriental Iron Casting Limited (Subsidiary)

Aron Auto Limited (Subsidiary)

Rose Fiscal Services Pvt. Ltd. (Subsidiary of Subsidiary)

Meltron Vincom Pvt. Ltd. (Subsidiary of Subsidiary)

BS Ispat Limited (Subsidiary of Subsidiary)

Gondwana Ispat Limited (Subsidiary of Subsidiary of Subsidiary)


Mar 31, 2012

Note:

Rupee term debt of Rs. 48,160 Lacs and NCDs of Rs 3,500 Lacs are secured by way of equitable mortgage on all immovable properties of the project situated at Vill. Lamloi, P.O Garvana, Rajgangpur, Distt Sundergarh, Orissa ranking pari-passu inter-se save and except the prior charge in favour of banks over inventories and book debts to secure working capital facilities.

Rupee term Loan of Rs. 40,000 Lacs is secured by way of subservient charge on movable fixed assets of the project situated at at Vill Lamloi, P.O Garvana, Rajgangpur, Distt Sundergarh, Orissa.

External Commercial Borrowing/INR term loan of Rs. 35,810 Lacs and Rs 13,500 Lacs respectively,are secured by way of first ranking and exclusive security over all fixed assets of the project situated at Plot No-A-285 Chopanki Industrial Area, Chopanki, Distt-Alwar, Rajasthan and Plot No-SP-256 Industrial Area Kehrani, Distt-Alwar, Rajasthan.

The company has reimbursed all the amount to OCL India Limited for onward submission on account of cross subsidy and wheeling charges payable by the latter to WESCO .The matter is disputed by OCL in the court and under an arrangement between the two companies OCL India Limited will refund the amount in case of recovery of the amount on favorable judgement. As reported to us the company, on the basis of the legal advice obtained by them, is reasonably sure of the recovery of the amount and as such the amount has been booked under the head short terms loans and advances instead of booking it as an expense.

Note : 1 Contingent Liabilities not provided for in respect of

Rs. In Lacs

Sr. No Particulars For the Year Ended For the Year Ended 31.3.2012 31.3.2011

i) Disputed Sales tax / VAT / Entry Tax demand (including interest & penalty) 693.33 483.92

ii) Disputed Excise Demand 307.32 160.65

iii) Bank Guarantees issued by bank on company's behalf 47.17 6.12

iv) Letter of credit issued on behalf of company 6.39 199.00 (outstanding amount)

Total 1,054.21 849.69


Mar 31, 2011

1. Estimated amount of contracts remaining to be executed on Capital account (net of advances) and not provided for Rs. 32578.58 lacs (Previous year Rs. 607.21 lacs).

2. Contingent Liabilities not provided for in respect of :

Rupees in Lacs

Particulars 2010-11 2009-10

Disputed Sales taxA/AT/Entry tax demand (including interest & penalty) 483.92 267.69

Disputed Excise Demand 160.65 -

Bank Guarantees issued by Bank on company's behalf 6.12 64.85

Letter of credit issued on behalf of the company (outstanding amount) 199.00 430.70

TOTAL 849.69 763.24

Future cash flow of above is determinable only on receipt of the decision/judgment from the respective authorities. A civil case is pending against the company in the court of civil judge, Sr. Division, Sundargarh. The case has been stayed by the High court of Orissa on account of the revision petition preferred by the company. The financial impact of the liability that may arise is not ascertainable on the date of the Balance Sheet.

3. On the basis of information available, there are no outstanding dues to the suppliers or service providers covered under the "Micro, Small and Medium Enterprises (Development) Act, 2006 and no interest has been paid/payable to such suppliers or service providers.

4. Assets hypothecated with banks also stand as security for non-fund based limits.

5. The company has reimbursed all the amount to OCL India Limited for onward submission on account of cross subsidy and wheeling charges payable by the latter to WESCO The matter is disputed by OCL in the court and under an arrangement between the two companies OCL India Limited will refund the amount in case of recovery of the amount on favourable judgement. As reported to us the company , on the basis of the legal advice obtained by them , is reasonably sure of the recovery of the amount and as such the amount has been booked under the head loans and advances instead of booking it as an expense.

6. In the opinion of the Board and to the best of their knowledge and belief, the valuation on realization 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.

7. The company has not accepted public deposits within the meaning and provisions of sec 58A and 58AA of the companies Act, 1956.

8. There is no impairment of any asset in terms of AS-28

9. Remuneration to Managing and Whole -time Directors

Rs 29.60 Lacs was paid to Managing and whole time Directors during the year (Previous Year Rs. 1.78 Lacs)

10. Computation of Commission payable to Directors (Other than Managing and Whole-time Directors)

No Commission was payable to Directors( Other than Managing and whole time Directors) during the year (Previous year Rs Nil)

11. During the year under review.Company Issued and allotted 53005000 2% Non cumulutive Redeemable Preference Shares to be redeemed not before 10 years and not later than 12 years from the date of allotment at such premium or may be decided by the Board of directors in accordance with the provisions of Companies Act 1956, or any re-enactment thereof.

12. The company has claimed deduction under section 80IA of the income tax act, 1961 in respect of power generation in tax returns.

13. Previous year figures have been regrouped/rearranged wherever necessary, to correspond to current year figures.


Mar 31, 2010

1. Estimated amount of contracts remaining to be executed on Capital account (net of advances) and not provided for Rs 607.21 lacs (Previous year Rs. 738.09 lacs).

2. Contingent Liabilities not provided for in respect of :

Rs in Lacs Particulars 2009-10 2008-09

Disputed Sales tax/VAT demand (including interest & penalty) 262.51 198.21

Matter under appeal

Disputed Entry tax- matter under appeal 5.18 0.08

Cross subsidy surcharge to WESCO- matter under appeal NIL 213.49

Bank Guarantees issued by Bank on companys behalf 64.85 NA

Letters of credit issued on behalf of the company (outstanding amount) 430.70 NA

TOTAL 763.24 411.78

Future cash flow of above is determinable only on receipt of the decision/judgment from the respective authorities. A civil case is pending against the company in the Court of Civil Judge, Sr. Division, Sundargarh. The case has been stayed by the High court of Orissa on account of the revision petition preferred by the company. The financial impact of the liability that may arise is not ascertainable on the date of the Balance Sheet.

3. On the basis of information available, there are no outstanding dues to the suppliers or service providers covered under the "Micro, Small and Medium Enterprises (Development) Act, 2006 and no interest has been paid/payable to such suppliers or service providers.

4. Assets hypothecated with banks also stand as security for non-fund based limits.

5. The company has reimbursed all the amount to OCL India Limited for onward submission on account of cross subsidy and wheeling charges payable by the latter to WESCO The matter is disputed by OCL in the Court and under an arrangement between the two companies, OCL India Limited will refund the amount in case of recovery of the amount on favourable judgement. As reported to us the company on the basis of the legal advice obtained by them is reasonably sure of the recovery of the amount and as such the amount has been booked under the head loans and advances instead of booking it as an expense.

6. In the opinion of the Board and to the best of their knowledge and belief, the valuation on realization 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.

7. The Company has not accepted public deposits within the meaning and provisions of sec 58A and 58AA of the Companies Act, 1956.

8. There is no impairment of any asset in terms of AS-28

9. Remuneration to Managing and Whole -time Directors

Rs. 1.78 Lacs was paid to Managing and whole time Directors during the year (Previous Year Rs.36.11 Lacs).

10. Computation of Commission payable to Directors (Other than Managing and Whole-time Directors)

No Commission was payable to Directors( Other than Managing and whole time Directors during the year (Previous year Rs 4.83 Lacs)

11. Related party Transactions (AS-18)

a) Related parties and their relationships

i. Key Managerial persons (KMP)

R H Dalmia (Vice Chairman)

Sabyasachi Mishra (Managing Director)

ii. Enterprises over which KMP are able to exercise significant influence

Hari Machines Limited, Satya Miners & Transporters Ltd., Konark Investments Ltd., Kiran Resources Ltd., OCL India Ltd., Dalmia Institute of Scientific and Industrial Research, Shree Durga Charitable Trust & Grandeur Tours & Travels (P) Ltd., Garima Buildprop (P) Ltd. & Gateway Impex Pvt. Ltd., Artech Infosystems.

12. During the year under review, M/s Garima Buildprop Private Limited acquired 60.83% shares from the outgoing promoters of the Company and further acquired 15.38% shares from the general public through open offer pursuant to SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 1997 which resulted in acquisition of 76.21% equity stake in the Company. Consequent to the above acquisition, Garima Buildprop Private Limited became the holding company and new promoter of the Company.

Subsequent to the takeover, there was change in the management of the Company. Mr. Nand Kishore Taori and Mr. Aditya Malhotra were appointed as directors and Dr. Sheoraj Jain, Mr. Raghu Hari Dalmia, Mr. Surendra Kumar Dalmia, Mr. Sabyasachi Mishra and Mr. K. M. Poddar resigned from the directorship of the Company

13. Previous year figures have been regrouped/rearranged wherever necessary, to correspond to current year figures.

 
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