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Notes to Accounts of Pacific Industries Ltd.

Mar 31, 2018

Note 1 Corporate Information

Pacific Industries Limited (the company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on Bombay Stock Exchange in India. The company is engaged in the export, manufacturing 6t trading of Granite tiles St slabs and other goods and commission activities.

Note 2.1 Fair Value of Investments in Unquoted securities/other interest in Gamut Tradecom LLP has been determined on the basis of the latest available audited financial statements of the respective investment.

Note 2.2 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.

In the event of liquidation of 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.

Note-3. Other Equity*

Description and nature of other equity:-

Retained Earnings: It represents the surplus amount available in profit and loss as retained earnings. The reserve can be distributed/ utilised by the company in accordance with the Companies Act,2013

Other Comprehensive Income: It represent the acturial gain or loss arising from the measurement of defined benefit obligation and fair value measurement of investments.

* Quantitative data mentioned in statement of changes in equity

(a) Loans from HDFC Bank for Vehicles carries interest @ 10%. The loans are repayable in 36 monthly installments and the loans are secured by hypothication of respective assets.

(b) Term loan from HDFC bank carries Interest @ Base Rate 1.65% (Current Base rate is 8.90 %) is secured by mortgage on property situated at village Bedla, District Udaipur and with respective Plant & Machinery and personal guarantee of some of directors of the company and the Loan is repayable in 66 monthly installments.

Note 4.1 The company has deferred tax assets however, management has not recognised deferred tax assets during the year in view of uncertainty of future Income available against such tax.

The above loan from HDFC Bank which carries Interest @ LIBOR 200 bps is secured by way of Hypothecation of Inventory i.e. Raw Materials, Stock in Process, Finished Goods, Stores & Spares and Book Debts, bill whether documentary or clean, outstanding monies, receivables, both present and future, equitable motgage of properties & the facility is subject to annual renewal and it also carries an unconditional and irrevocable personal guarantees of the Whole Time Directors and property holders.

Loan from HDFC Bank for PCFC working capital is secured by way of Hypothecation of company''s entire stocks(Raw material, Work in progress, Finished Goods, Consumables) & book debts.

Consequent to IND AS implication the sales figures of the current period as well as last periods have been recasted.

Note-5. Corporate Social Responsibility Expenditure

The company has incurred CSR expenses of Rs 3.72 lakhs in FY 2017-18 as compared to Rs 10.62 in the FY 2016-17.

Note-5. Lease

The company has taken mines on Operating Lease from "Department of Mines & Geology" and minimum yearly rental is being paid which is adjusted against royalty amount, if payable.

Note-6. Employee Benefit

(A) Defined Contribution Plan:-

The Company operates defined contribution retirement benefit plans for all qualifying employees. Contributions are made to registered provident fund and Employee state insurance administered by the government. The obligation of the Company is limited to the amount contributed and it has no further contractual nor any constructive obligation.

(B) Defined Benefit Plan:-Gratuity

In accordance with the provisions of Payment of Gratuity Act, 1972, the company has defined benefit plan which provides for gratuity payment. The plan provides a lump sum gratuity payment to eligible employees at retirement or termination of their employment. The amounts are based on the respective employee''s last drawn salary and the year of employment with the company. The company''s gratuity plan is an unfunded plan.

These plans typically expose the Company to actuarial risks such as: Actuarial Risk, Investment Risk, Liquidity Risk, Market Risk & Legislative Risk:

A. Actuarial Risk:

It is the risk that benefits will cost more than expected. This can arise due to one of the following reasons:

Adverse Salary Growth Experience : Salary hikes that are higher than the assumed salary escalation will result into an increase in Obligation at a rate that is higher than expected.

Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption than the Gratuity Benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the acceleration of cashflow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate.

Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption than the Gratuity Benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.

B. Investment Risk:

For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

C. Liquidity Risk:

Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the company there can be strain on the cashflows.

D. Market Risk:

Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice

E. Legislative Risk:

Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

No other post-retirement benefits are provided to the employees.

The actuarial valuation of the plan assets and the present value of the defined benefit obligation were carried out as at March 31, 2018 by a certified actuary of the Institute of Actuaries of India. The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the projected unit credit method.

Leave Encashment

Compensated absence liability recognised as expense for the year is Rs. 16.73 Lakhs (Previous Year Rs. 17.07 Lakhs). The said amount has been calculated by the management. It has been calculated on the basis of leaves accumulated during the year other relevant factors.

Note-7. Capital Management

The capital structure of the Company consists of net debt and total equity of the Company. The Company manages its capital to ensure that the Company will be able to continue as going concern while maximising the return to stakeholders through an optimum mix of debt and equity within the overall capital structure. The Company’s risk management committee reviews the capital structure of the Company considering the cost of capital and the risks associated with each class of capital.

Note-8. Related Party Disclosures

The Company has made the following transactions with related parties as defined under the provisions of Indian Accounting Standard-24 issued by the Institute of Chartered Accountants of India & notified by MCA under Companies (Indian Accounting Standard) Rules, 2015, as amended.

Note-9. Debit & Credit Balances appearing under Sundry Debtors, Loans & Advances, Unsecured Loans, Sundry Creditors are subject to confirmation & reconciliation. Adjustment, if any, in these accounts will be made as & when finally reconciled & confirmed. Trade Receivables & Trade Payables have been taken at their book value after making necessary adjustment on account of foreign exchange fluctuation except in case of some old balances lying in account.

Note-10. Contingent Liabilities/Commitments, Contingent Assets & Pending Litigations Contingent Liabilities

(A) Claims against the company not acknowledged as debt.

A.1 Demand of Rs 8.66 lacs against which the company has deposited Rs 8.66 lacs under Central Excise act against which the company has filed an appeal.

A.2 Service Tax refund claim rejection of Rs 11.02 lacs against which the company is persuing the matter with concerned department.

A.3 The company has a total demand of Rs. 15.21 lacs for Entry Tax out of which the company has deposited Rs. 7.60 Lacs under protest. For rest of the amount of Rs 7.61 Lacs the company is persuing the matter with concerned department.

A.4 The company has a total demand of Rs. 43.89 lacs from Sales Tax Department against which the company has deposited Rs. 21.95 Lacs under protest. For rest of the amount of Rs 21.95 Lacs the company is persuing the matter with concerned department.

A.5 Demand Raised by the Central Excise Commissionerate of Rs 1.11 Crores against which Rs 55.96 Lacs is deposited by the company.The Said Matter has been taken to the High Court and the petition is still pending.

A.6 Demand Raised by the Central Excise Commissionerate of Rs 58.66 Lacs against which Rs 4.40 Lacs is deposited by the company against which the company has filed an appeal.

A.7 The company has a total demand of Rs. 78.39 lacs of Custom Duty out of which the company has deposited Rs. 5.88 Lacs under protest against which the company has filed an appeal.

A.8 The company has a total demand of Rs. 1095.52 Lacs (555.14 Lacs for the AY 15-16, 255.02 Lacs for AY 14-15 & 285.35 Lacs for AY 11-12) for which company has filed an appeal before CIT (Appeal) and CIT (Appeal) has given the relief by the order passed by him. The Income Tax Department has filed an appeal before ITAT against the order of CIT (Appeal). The company has deposited Rs. 28.50 Lacs under protest for the aforesaid matter.

(B) Other Contingents Liabilities

B.1 Show cause notice received from excise authorities of Rs 1.02 crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported marble blocks, however no demand has been received from the excise authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

B.2 Show Cause notice received from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification on imported marble blocks. However no demand has been received from the Custom authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for - Nil

(C) Contingent Assets - Nil

There were no changes in the fair value hierarchy levels in the above periods.

(a) Upon the application of IND AS 109, the Company has chosen to designate these investments in equity instruments as at FVTOCI.

(b) Investment in Subsidiaries, NSC, and LLP is Valued at Cost as the company has opted to adopt cost method as per IND AS.

Fair values for financial instruments carried at amortised cost approximates the carrying amount, accordingly the fair values of such financial assets and financial liabilities have not been disclosed separately.

The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. The fair values of the financial assets and liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following methods and assumptions were used to estimate the fair values:

1) Fair value of cash and deposits, trade receivables, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments, however there is a change in the fair value of Investments the gain/loss on which has been recognised according to the accounting policies.

Note 11: Financial Risk Management

Financial risk management policy and objectives

The key objective of the Company’s financial risk management is to ensure that it maintains a stable capital structure with the focus on total equity to uphold investor, creditor, and customer confidence and to ensure future development of its business. The Company is focused on maintaining a strong equity base to ensure independence, security, as well as financial flexibility for potential future borrowings, if required without impacting the risk profile of the Company.

Company''s principal financial liabilities, comprise Borrowings from Banks, trade and other payables. The main purpose of these financial liabilities is to finance Company''s operations and plant expansion. Company’s principal financial assets include investments, trade and other receivables, deposits with banks and cash and cash equivalents, that derive directly from its operations.

Company is exposed to market risk, credit risk and liquidity risk.

The Company’s Board oversees the management of these risks. The Company''s Board is supported by senior management team that advises on financial risks and the appropriate financial risk governance framework for the Company. The senior management provides assurance to the Company’s Board that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives.

The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below,

i) Market risk

Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk interest rate risk, currency risk and price risk. Financial instruments affected by market risk include investments in equity shares, security deposits, trade and other receivables, deposits with banks and financial liabilities.

The sensitivity analysis in the following sections relate to the position as at 31 March 2018 and 31 March 2017. The sensitivity of the relevant income statement item is the effect of the assumed changes in respective market risks.

a) Foreign currency risk

Foreign currency risk is the risk that fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rate. The company is exposed to foreign exchange risk arising from foreign currency transactions primarily to USD & EURO. Company do not enter into any derivative instrument in order to hedge its foreign currency risks.

c) Commodity Risk

Commodity risk is defined as the possibility of financial loss as a result of fluctuation in price of Raw Material/Finished Goods and change in demand of the product and market in which the company operates. The Company is exposed to the movement in price of key raw materials in domestic and international markets. The Company has in place policies to manage exposure to fluctuations in the prices of the key raw materials used in operations. The company forecast annual business plan and execute on monthly business plan. Raw material procurement is aligned to its monthly/annual business plan and inventory position is monitored in accordance with future price trend.

ii) Credit risk

Credit risk refers to the risk of default on its obligation by the counterparty resulting in a financial loss. The Company is exposed to credit risk mainly from its operating activities (primarily trade receivables) and from its financing activities, including deposits with banks.

Credit risk on trade receivables is managed by the Company through credit approvals, establishing credit limits and continuously monitoring the creditworthiness of customers to which the Company grants credit terms in the normal course of business. The Company has no concentration of risk as customer base in widely distributed both economically and geographically.

An impairment analysis is performed at each reporting date on an individual basis for major clients. In addition, a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively. The calculation is based on exchange losses historical data. The maximum exposure to credit risk at the reporting date is the carrying value of each class of financial assets. The Company does not hold collateral as security. The Company uses expected credit loss model to assess the impairment loss or gain. The Company uses a provision matrix to compute the expected credit loss allowance for trade receivables. The provision matrix takes into account available external and internal credit risk factors such as financial condition, ageing of outstanding and the Company''s historical experience for customers.

a) Financial instruments and cash deposits

Credit risk from balances with banks and financial institutions is managed by the Company''s treasury department in accordance with Company''s policy. Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Company monitors rating, credit spreads and financial strength of its counter parties. Company monitors ratings, credit spread and financial strength of its counter parties. Based on ongoing assessment Company adjust it''s exposure to various counterparties. Company''s maximum exposure to credit risk for the components of balance sheet is the carrying amount as disclosed in Note 42.

Liquidity risk is the risk that the Company may not be able to meet its present and future cash flow obligations without incurring unacceptable losses. Company''s objective is to, at all time maintain optimum levels of liquidity to meet its cash requirements. Company closely monitors its liquidity position and deploys a robust cash management system. It maintains adequate sources of financing including overdraft, debt from banks at optimised cost and cash flow from operations.

Note-12. First Time Adoption of Ind AS

These are company''s first standalone financial statements prepared in accordance with Ind AS. For the purposes of transition to Ind AS, the Company has followed the guidance prescribed in Ind AS 101 "First Time adoption of Indian Accounting Standard'''', with April 01, 2016 as the transition date and IGAAP as the previous GAAP.

The transition to Ind AS has resulted in changes in the presentation of the financial statements, disclosures in the notes thereto and accounting policies. The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended March 31, 2018 and the comparative information. An explanation of how the transition from previous GAAP to Ind AS has affected the Company''s Balance Sheet and Statement of Profit and Loss, is set out in Note 42.2 and 42.3 Exemptions on first time adoption of Ind AS availed in accordance with Ind AS 101 have been set out in Note 42.1.

Note-12.1 Exemptions availed on first time adoption of Ind-AS 101

The Company has opted to consider the carrying value of all items of Property, plant & equipment recognised in the financial statement prepared under previous GAPP and use the same as deemed cost in the opening Ind AS balance sheet.

An entity''s estimates in accordance with Ind ASs at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is objective evidence that those estimates were in error.

Ind AS estimates as at 1 April 2016 are consistent with the estimates as at the same date made in conformity with previous GAAP. The Company made estimates for Impairment of financial assets based on expected credit loss model in accordance with Ind AS at the date of transition as these were not required under previous GAAP.

Explanations for reconciliation of Balance Sheet as previously reported under IGAAP to INDAS:-

1) The company has opted to revalue ifs investments at fair market value as per Ind AS-109. The company has also opted to consider all investments at fair value through other comprehensive income.

2) Provision for Gratuity has been revalued as per the Actuarial Report.

3) The impact of all Ind AS adjustements have been reflected in other equity.

Note : 13 SEGMENT REPORTING :

Company has considered business segment as the primary segment for disclosure. The business segments are Marble & Granite, Trading other than Marble & Granite & Other Services

14 STANDARDS ISSUED BUT NOT YET EFFECTIVE

On March 28, 2018, Ministry of Corporate Affairs ("MCA") has notified the Companies (Indian Accounting Standards) Amendment Rules, 2018 for following standards to be effective from 1 April 2018:

Ind AS 115 - Revenue from Contracts with Customers

Ind AS 115 will supersede the current revenue recognition guidance including Ind AS 18 Revenue, Ind AS 11 Construction Contracts and the related interpretations. Ind AS 115 provides a single model of accounting for revenue arising from contracts with customers based on the identification and satisfaction of performance obligations.

Ind AS 21, Foreign currency transactions and advance consideration:

Appendix B to Ind AS 21, Foreign currency transactions and advance consideration which clarifies the date of the transaction for the purpose of determining the exchange rate to use on initial recognition of the related asset, expense or income, when an entity has received or paid advance consideration in a foreign currency.

Application of above standards are not expected to have any significant impact on the Company’s Financial Statements.

15. The previous year''s figures have been regrouped, rearranged and reclassified to conform to current year Ind-AS presentation requirements.


Mar 31, 2015

Note 1. The above loan from HDFG Bank which carries Interest @ LIBOR 350 bps is secured by way of Hypothecation of Inventory i.e.'Raw Materials, Stock in Process, Finished Goods, Stores & Spares and Book Debts. bill whether documentary or clean, outstanding monies, receivables, both present and future. the facility is subject to annual renewal. Further an is also secured by mortgage of property situated at Village bedlam .District 'Udaipur and also by way Of Personal Guarantee of directors of the company,

Note 2. The Government of India has promulgated "The Micro, Small & Medium Enterprises Development Act" 2006 which came into force w.e.f, October 2,2 006. The Company is required to identify the Micro & Small Enterprises & pay them interest on overdue beyond the specified period irrespective of the terms agreed with the enterprises. The Company has initiated the process of identification of such suppliers. In view of no. of suppliers & no receipt of critical inputs & response from several such potential parties, the liability 'of interest cannot be reliable estimated nor can required disclosure be made. Accounting in this regard will be carried but after process is complete and reliable estimate can be made in this regard. Since the Company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability

Note 3. Sundry creditors for material includes Rs. 6486984/ -(Previous year Rs 9179588/-J from related parties and Sundry Creditors for others includes Rs.17362801/ - (Previous year Rs. 57398806/-) from related parties.

Note 4.

The company has substantial amount of brought forward unrecognized MAT credit of Rs. 5.56.00 Lacs and hence the company is liable to pay Minimum Alternate Tax (MAT) in accordance with the provisions of the Income tax Act, 1961, The same has been debited to P&L account of the company, MAT credit and Deferred Tax Assets is not recognized as a measure of prudence.

Note The Company has only one Class of Equity. Shares having par value of 10 per shares. Each holder of equity. Shares is : entitled 'to one vote per share.

Note 5.

In line with the notification .dated 31st March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting , Standard A$ll Effects of Changes in Foreign Exchange Rates', the Company has: chosen to exercise the option under paragraph 46. inserted in the standard by the notification. Accordingly, the company has. adjusted the foreign currency exchange differences On amounts outstanding for acquisition of fixed assets, to the carrying cost of fixed assets.

Note 6. There are no reportable segments as per AS-17.

NOTES ON FINANCIAL STATEMENTS FOR THE YEAR ENDED ON 31.03.2015

Note 7.

Debit & Credit Balances appearing under Sundry Debtors, Advance Receivables in Cash or in Kind unsecured Loans, Sundry . Creditors are subject to confirmation & reconciliation. Adjustment, if any, in these accounts will be made as & when finally reconciled &.confirmed, Trade: Receivables & Trade Payables have been taken at their Book Value after making necessary adjustment on account of foreign exchange fluctuation except in cases of some old balances lying in account. Further during the year under review, the Management has reconciled certain balances for which necessary affect on such reconciliations has been made.

NOTE 8-Contingent Liabilities & Commitments

Contingent Liabilities :

(A) , Claims against the company not acknowledge as debt. .

A.l Demand of Rs 8.66 lacs against which the company has deposited Rs 8.66 lacs under Central Excise act against which the company has filed an appeal

A.2 Service Tax refund claim rejection 'of- Rs 11.02 lacs against which the company is perusing the matter with concerned department.

A.3 The company has at tilde and ofRs.l5.211 acs for Entry Tax out of which the company has deposited Rs.7.60 Lacs under protest. For rest of the amount of Rs 7.61 Lacs the company is perusing the matter with concerned department.

A.4- The company has a total demand of Rs. 43.89 lacs from Sales Tax Department against which the company has . deposited Rs. 21.95 Lacs linger protest, For rest of the amount of Rs 2.1.95 Lacs the company is perusing the matter with' concerned department.

A.5 Demand Raised by the Central Excise Commissioner ate of Rs 1.11 Crores/-against which Rs 55.96 Laes is deposited by the company. The Said Matter has been taken to the High Court and the petition is still pending.

A.6 Demand Raised by the Central Excise Commissioner ate of Rs 58.66 Lacs/- against which Rs 4.40 Lacs is Deposited by the company against which the company has filed an appeal. CB} Guarantees NIL

(C) Other Contingent Liabilities

CI Show cause notice received from excise authorities of Rs .1:02 Crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported; marble blocks, how demand has been received from the excise authorities against the same and based on the legal opinion.

obtained, the company does not expectancy liability on this account. Li Show Cause notice received from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification oh imported marble blocks. However no demand has been-received from the Custom authorities against the same and based On tie legal opinion obtained, the company does not expect any liability on this account. Commitments NIL.

NOTE 9 - The Provision of Section 135 of the Companies Act, 2013 are applicable. to the. Company Accordingly, the Company has incurred Rs. 13.72 Lacs during the year on account of expenditure towards Corporate Social Responsibility. Company has paid amount to Geetanjali University for the Free flooding: and medical treatment to the people.

NOTE 10 - Previous year's figures have been regrouped and rearranged wherever considered necessary. for on the realization/sale thereof.


Mar 31, 2014

A. The Company has only one Class of Equity Shares having a par value of 10 per shares. Each holder of equity shares is entitled to one vote per share.

B. SHARES HELD BY EACH SHAREHOLDERS HOLDING MORE THAN 5% SHARES AS ON 31.03.2013

Note 1.1

(a) Loans from ICICI bank for Vehicles carries interest @ 9.99% To 10.07%. The loans are repayable in 36 Monthly installments.

(b) Loans from HDFC Bank for Vehicles carries interest @ 8.00% To 09.14%. The loans are repayable in 36 monthly installments. --- All the above Loans are secured by way of Hypothecation of respective assets.

Note 2.1 The Government of India has promulgated “The Micro, Small & Medium Enterprises Development Act” 2006 which came into force w.e.f. October 2, 2006. The Company is required to identify the Micro & Small Enterprises & pay them interest on overdue beyond the specified period irrespective of the terms agreed with the enterprises. The Company has initiated the process of identification of such suppliers. In view of no. of suppliers & no receipt of critical inputs & response from several such potential parties, the liability of interest cannot be reliable estimated nor can required disclosure be made. Accounting in this regard will be carried out after process is complete and reliable estimate can be made in this regard. Since the Company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability.

NOTE 3- Deferred Tax Assets (Net)

Note 3.1 The company has substantial amount of unrecognized MAT credit of Rs. 68404487/- and hence the company is liable to pay Minimum Alternate Tax (MAT) in accordance with the provisions of the Income tax Act, 1961. The same has been debited to Statement of Profit and Loss of the company. MAT credit is not recognized as a measure of prudence. However the figures of the Deferred Tax liabilities / Assets as on 31.03.2013 is as under:-

Note 4.1 All Trade Receivables are likely to be realized within twelve months from the date of Balance Sheet.

Note 4.2 Trade Receivables of Rs. 446828/- are to be realized from related parties.

Note : 5.1 FDR''s includes Deposits which are pledged against BG/LC Rs. 1,306,507/- (Previous Year Rs. 1,208,051/-)

Note : 5.2 FDR''s includes Deposits of Rs. 1,80,00,000/- excluding interest (Previous Year Rs. 1,118,525/-) with maturity of more than 12 months.

Note : 5.3 FDR of Rs 30,00,000 are pledged against Bank Guarantee in Favour Sales Tax Department as follows:- Rs 8,00,000- Demand raised by the Sales Tax Department for Entry Tax Amount Payable Rs 22,00,000- Demand raised by the Sales Tax Department for VAT Amount Payable

Note : 5.4 New FDR of Rs 3,01,00,000 with ICICI Bank is pledged against Margin Money

Note 6.1 Rebates, claims and discount etc on sales are accounted for and being provided for as and when settled with the parties as per consistent policy adopted by the Company every year.

Note 7 In line with the notification dated 31st March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting Standard AS11 –‘Effects of Changes in Foreign Exchange Rates’, the Company has chosen to exercise the option under paragraph 46 inserted in the standard by the notification. Accordingly, the company has adjusted the foreign currency exchange differences on amounts outstanding for acquisition of fixed assets, to the carrying cost of fixed assets.

Note 8 The Company has only one reportable segment i.e. exports of Granite & Marble.

NOTE 9 - R elated parties information is as under – AS 18

(a) Key Management Personnel

Shri J.P. Agarwal (Chairman & Managing Director)

Shri Kapil Agarwal (Whole Time Director)

(b) Relatives

Ankit Agarwal

Geetadevi Agarwal

Kanika Agarwal

Sarita Agarwal

Shruti Agarwal

(c) Entities in which key management personnel and their relatives are interested

Ankit Buildmart Pvt. Ltd.

Dhawal Marbles and Granites Pvt. Ltd.

Divya Finlease Pvt. Ltd.

Geetanjali Education Society

Geetanjali Foundation

Geetanjali Infosystems (P) Ltd

Geetanjali Institute of technical studies

Geetanjali Investech Holdings Pvt Ltd,

Geetanjali Marble

Geetanjali University Trust

J P Marble

Kapil Exports

Krishna Marble

Lakecity Housing P.Ltd.

Ojaswi Marbles & Granites Pvt. Ltd.

Pacific Export

Pacific Leasing

Pearl Exports

Pearl real home developer

Rahul Awas yojna p. Ltd.

Rahul Marbles Pvt. Ltd.

Shephali Hotel & Resorts Pvt. Ltd.

Shruti Syntheices ltd.

Yash Processors Pvt. Ltd

Note 10 - Debit & Credit Balances appearing under Sundry Debtors, Advance Receivables in Cash or in Kind , Unsecured Loans, Sundry Creditors are subject to confirmation & reconciliation. Adjustment, if any, in these accounts will be made as & when finally reconciled & confirmed. Trade Receivables & Trade Payables have been taken at their Book Value after making necessary adjustment on account of foreign exchange fluctuation except in cases of some old balances lying in account.

NOTE 11 - Contingent Liabilities & Commitments

Contingent Liabilities

(A) Claims against the company not acknowledge as debt.

A1. Demand of Rs 8.66 lacs against which the company has deposited Rs 8.66 lacs under Central Excise act against which the company has filed an appeal.

A.2.Service Tax refund claim rejection of Rs 3.40 lacs against which the company is perusing the matter with concerned department.

A.3. The company has a total demand of Rs. 15.21 lacs for Entry Tax out of which the company has deposited Rs. 7.60 Lacs under protest. For rest of the amount of Rs 7.61 Lacs the company is perusing the matter with concerned department.

A.4. The company has a total demand of Rs. 43.89 lacs from Sales Tax Department against which the company has deposited Rs. 21.95 Lacs under protest. For rest of the amount of Rs 21.95 Lacs the company is perusing the matter with concerned department.

A.5.The Company also has contingent liability of Rs. 18.30 lacs in respect of Custom duty for which Company has deposited NIL amount.

A.6.Demand Raised by Service Tax Department of Rs 4.53 Lacs out of which 3.47 Lacs has been deposited and for rest of the amount of Rs 1.06 he company is perusing the matter with concerned department.

A.7.Demand Raised by the Central Excise Commissionerate of Rs 1.11 Crores/- against which Rs 55.96 Lacs is deposited by the company.

(B) Guarantees NIL

(C) Other Contingent Liabilities

C.1.Show cause notice recd from excise authorities of Rs 1.02 crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported marble blocks, however no demand has been received from the excise authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

c.2.(a) Show Cause notice recd from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification on imported marble blocks. However no demand has been received from the Custom authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

Commitments

A.Forward Contracts entered but remaining to be executed Rs. NIL / $ NIL (Previous Year Rs. 1,32,18,250 / $ 250000).

NOTE 12 - Previous years figures have been regrouped and rearranged wherever considered necessary.


Mar 31, 2013

Note 1 In line with the notification dated 31* March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting Standard ASH -Effects of Changes in Foreign Exchange Rates'', the Company has chosen to exercise the option under paragraph 46 inserted in the standard by the notification. Accordingly, the company has adjusted the foreign currency exchange differences on amounts outstanding for acquisition of fixed assets, to the carrying cost of fixed assets.

Note 2 The Company has only one reportable segment i.e. exports of Granite & Marble.

Note 3 - Debit & Credit Balances appearing under Sundry Debtors, Advance Receivables in Cash or in Kind , Unsecured Loans, Sundry Creditors are subject to confirmation & reconciliation. Adjustment, if any, in these accounts will be made as & when finally reconciled & confirmed. Trade Receivables & Trade Payables have been taken at their Book Value after making necessary adjustment on account of foreign exchange fluctuation except in cases of some old balances lying in account.

NOTE 4 - Contingent Liabilities & Commitments Contingent Liabilities

(A) Claims against the company not acknowledge as debt.

AJ, Demand of Rs 8.66 lacs against which the company has deposited Rs 8.66 lacs under Central Excise act against which the company has filed an appeal.

A.2 Service Tax refund claim rejection of Rs 3.40 lacs against which the company is perusing the matter with concerned department.

A.3 The company has a total demand of Rs. 15.21 lacs for Entry Tax out of which the company has deposited Rs. 7.60 Lacs under protest. For rest of the amount of Rs 7.61 Lacs the company is perusing the matter with concerned department.

A4 The company has a total demand of Rs. 43.89 lacs from Sales Tax Department against which the company has deposited Rs. 21.95 Lacs under protest. For rest of the amount of Rs 21.95 Lacs the company is perusing the matter with concerned department.

AJ> The Company also has contingent liability of Rs. 18.30 lacs in respect of Custom duty for which Company has deposited NIL amount.

A.6 Demand Raised by Service Tax Department of Rs 4.53 Lacs out of which 3.47 Lacs has been deposited and for rest of the amount of Rs 1.06 he company is perusing the matter with concerned department.

A.7 Demand Raised by the Central Excise Commissionerate of Rs 1.11 Crores/- against which Rs 55.96 Lacs is deposited by the company.

(B) Guarantees NIL

(C) Other Contingent Liabilities

Ci Show cause notice reed from excise authorities of Rs 1.02 crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported marble blocks, however no demand has been received from the excise authorities against the same and based on the legal opinion obtained, the company does not expert any liability on this account.

£2 (a) Show Cause notice reed from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification on imported marble blocks. However no demand has been received from the Custom authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

Commitments

(A) Forward Contracts entered but remaining to be executed Rs. NIL / $ NIL (Previous Year Rs, 1,32,18,250 / $ 250000).

NOTE 5 - Previous years figures have been regrouped and rearranged wherever considered necessary.

Corporate information

"Pacific Industries Limited" is a public Limited Company domiciled in India and incorporated under the provisions of Companies Act, 1956. The Company is engaged in manufacturing of Granites & Marble Slabs. In the current Financial year 2012-13, the company has expanded its line of business to mining of granite blocks operation which is carried out under a unit of company located in Chennai. The Company is having 100% EOU & caters huge demand of Foreign Markets for Granite & Marbles Slabs.


Mar 31, 2011

(1) Contingent liability are not provided for in the matter of :

(a) Guarantees issued by bank on behalf of the Company Rs. NIL /- (Previous year Rs.6, 00,000/-).

(b) Letter of credit issued by bank on behalf of the Company Rs.10,11,415 /- (Previous year Rs.19,55,198/-).

(c) Show cause notice recd from excise authorities of Rs 1.02 crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported marble blocks, however no demand has been received from the excise authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account

(d) Show Cause notice recd from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification on imported marble blocks. However no demand has been received from the Custom authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

(e) Demand of Rs8.66 lacs against which the company has deposited Rs8.66 lacs under Central Excise act against which the company has filed an appeal.

(f) Service Tax refund claim rejection of Rs3.40 lacs against which the company is perusing the matter with concerned department.

(2) Debit and Credit balances appearing under sundry debtors, advance recoverable in cash or in kind, unsecured loans, sundry creditors are subject to confirmation and reconciliation. Adjustment, if any, in these accounts will be made as and when finally reconciled and confirmed.

(3) Receivables have been taken at their book value, after making necessary adjustment on account of foreign exchange fluctuation.

(4) Consumption of raw material and consumables and stores & spares have been arrived at by adding purchases to opening stock and deducting closing stock there from.

(5) Net realizable value in respect of valuation of crazy/ waste arising out of production have been taken by the management on the basis of quotation received from various parties.

(6) The company has provided Gratuity provision on accrual method as it will became payable on accounting year's end. This provisioning method is not according to Accounting standard – 15 Employee benefits issued by the Institute of Chartered Accountants of India. The impact of difference between provisions made and required to be made as suggested in AS– 15 is unascertainable.

(7) During the year the Company has incurred exchange Loss of Rs.2,33,148 /- on account of Foreign exchange fluctuations (previous year loss of Rs.1,26,40,887/-)

(8) In line with the notification dated 31st March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting Standard AS11 –'Effects of Changes in Foreign Exchange Rates', the Company has chosen to exercise the option under paragraph 46 inserted in the standard by the notification. Accordingly, the company has adjusted the foreign currency exchange differences on amounts outstanding for acquisition of fixed assets, to the carrying cost of fixed assets.

(9) FDR's includes FDR's, which are pledged against margin money Rs.11,18,525 /-, (Previous year Rs.10,54,704/-).

(10) The company has substantial amount of unabsorbed depreciation / business losses hence the company is liable to pay Minimum Alternate Tax (MAT) in accordance with the provisions of the Income tax Act, 1961. The same has been debited to P&L account of the company. MAT credit is not recognized as a measure of prudence. Further the company was running in heavy losses during earlier years and the company has substantial amount of unabsorbed depreciation/ business losses as per Income Tax Act. In view of accounting policy no. 12, the company has not recognized Deferred Tax Assets since there is no virtual certainty supported by convincing evidences that sufficient future taxable income will be available against which such deferred tax assets can be realized. However the figures of the Deferred Tax liabilities / Assets as on 31.03.2011 is as under:-

(11) Previous years figures have been rearranged/ regrouped wherever necessary.

(12) Remuneration to Chairman & Managing Director comprises Rs.24, 00,000 /- as salary, (Previous year Rs.24,00,000/-).

(13) The basic earnings per share are computed by dividing the net profit after tax for the period by the weighted average number of Equity Shares outstanding during the period.

(14) Related parties information is as under – AS 18:

(a) Key Management Personnel

Shri J. P. Agarwal (Chairman & Managing Director) Shri Kapil Agarwal (Whole Time Director) Shri Devendra Maliwal ( Executive Director)

(b) Relatives

Shri Bhola Ram Agarwal

Smt. Leela Devi Agarwal

Smt. Geeta Devi Agarwal

Ashish Agarwal

Rahul Agarwal

Ankit Agarwal

Preeti Agarwal

Shruti Agarwal

Sarita Agarwal

(c) Entities in which key management personnel and their relatives are interested.

Rameshwar Agencies

Ruchita Exports

Kapil Exports

Geetanjali Marble

Dhawal Marbles & Granites P. Ltd.

Ojaswi Marbles & Granites P. Ltd.

Rahul Marbles P. Ltd

Amit Granites

Pearl Exports

Pacific Leasing & Research Ltd.

Shruti Synthetics Ltd.

J P Marble

Pacific Education Society

Ankit Buildmart P. Ltd.

Geetanjali Infosystem P.Ltd.

Krishna Marble

Lakecity Housing Devlopment P.Ltd

Pacific Export

Pearl Real Home Developer P. Ltd

Rahul Awas Yojna P. Ltd.

Rajat Housing Devloper P. Ltd.

Yesh processors Pvt. Ltd.

(15) Figures are rounded off to the nearest rupees.

(16) The Company is operating in only one segment i.e. exports of Granite & Marble; hence there is no reportable segment.

(17) The Government of India has promulgated "The Micro, Small & Medium Enterprises Development Act" 2006 which came into force w.e.f. October 2, 2006. The Company is required to identify the Micro & Small Enterprises & pay them interest on overdue beyond the specified period irrespective of the terms agreed with the enterprises. The Company has initiated the process of identification of such suppliers. In view of no. of suppliers & no receipt of critical inputs & response from several such potential parties, the liability of interest cannot be reliable estimated nor can required disclosure be made. Accounting in this regard will be carried out after process is complete and reliable estimate can be made in this regard. Since the Company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability.

(h) There is no expenditure incurred on employees, who were in receipt of remuneration in the aggregate of not less than Rs.24,00,000/- per annum, if employed throughout the year or 2,00,000/- per month, if employed for a part of the year (previous year NIL) , is as per Annexure - B of Director's Report.


Mar 31, 2010

(1) Contingent liability are not provided for in the matter of:

(a) Guarantees issued by bank on behalf of the Company Rs. 6,00,000/- (Previous year Rs.6,00,000/-).

(b) Letter of credit issued by bank on behalf of the Company Rs. 19,55,198 /- (Previous year Rs. 44,98,074/-).

(c) Show cause notice reed from excise authorities of Rs-1.02 crore in respect of excise duty imposed on ground of availing wrong benefit of exemption notification on imported marble blocks, however no demand has been received from the excise authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account

(d) Show Cause notice reed from excise authorities of Rs 4.94 crore in respect of custom duty under the provision of Custom Act 1962 imposed on ground of availing wrong benefit of exemption notification on imported marble blocks. However no demand has been received from the Custom authorities against the same and based on the legal opinion obtained, the company does not expect any liability on this account.

(e) Demand of Rs 8.66 lacs against which the company has deposited Rs 8.66 lacs under Central Excise Act against which the company has filed an appeal.

(f) Service Tax refund claim rejection of Rs 3.40 lacs.against which the company is perusing the matter with concerned department.

(2) Debit and Credit balances appearing under sundry debtors, advance recoverable in cash or in kind, unsecured loans, sundry creditors are subject to confirmation and.reconciliation. Adjustment, if any, in these accounts will be made as and when finally reconciled and confirmed.

(3) Receivables have been taken at their book value, after making necessary adjustment on account of foreign exchange fluctuation.

(4) Consumption of raw material and consumables and stores & spares have been arrived at by adding purchases to opening stock and deducting closing stock there from.

(5) Net realizable value in respect of valuation of crazy/ waste arising out of production have been taken by the management on the basis of quotation received from various parties.

(6) The company has provided Gratuity provision on accrual method as it will became payable on accounting years end. This provisioning method is not according to Accounting standard - 15

Employee benefits issued by the Institute of Chartered Accountants of India. The impact of difference between provisions made and required to be made as suggested in AS-15 is unascertainable.

(7) During the year the Company has incurred exchange Loss of Rs. 1,26,40,887/- on account of Foreign exchange fluctuations (previous year gain of Rs. 3,17,36,423/-)

(8) In line with the notification dated 31st March, 2009 issued by The Ministry of Corporate Affairs, amending Accounting Standard AS 11 -Effects of Changes in Foreign Exchange Rates, the Company has chosen to exercise the option under paragraph 46 inserted in the standard by the notification. Accordingly, the company has adjusted the foreign currency exchange differences on amounts outstanding for acquisition of fixed assets, to the carrying cost of fixed assets.

(9) FDRs includes FDRs, which are pledged against margin money Rs. 10,54,704 /-, (Previous year Rs. 16,04,772/-).

(10) The company has substantial amount of unabsorbed depreciation / business losses hence the company is liable to pay Minimum Alternate Tax (MAT) in accordance with the provisions of the Income tax Act, 1961; The same has been debited to P&L account of the company. MAT credit is not recognized as a measure of prudence. Further the company was running in heavy losses during earfier years and the company has substantial amount of unabsorbed depreciation/ business losses as per Income Tax Act. In view of accounting policy no. 12, the company has not recognized Deferred Tax Assets since there is no virtual certainty supported by convincing evidences that sufficient future taxable income will be available against which such deferred tax assets can be realized. However the figures of the Deferred Tax liabilities /Assets as on 31.03.2010 is as under:-

(11) Previous years figures have been rearranged/ regrouped wherever necessary.

(12) Remuneration to Chairman & Managing Director comprises Rs.24, 00,000 /- as salary, (Previous year Rs. 13, 50,000/-).

(13) The basic earnings per share are computed by dividing the net profit after tax for the period by the weighted average number of Equity Shares outstanding during the period.

(14) The Company is operating in only one segment i.e. exports of Granite & Marble; hence there is no reportable segment.

(15) The Government of India has promulgated "The Micro, Small & Medium Enterprises Development Act" 2006 which came into force w.e.f. October 2, 2006. The Company is required to identify the Micro & Small Enterprises & pay them interest on overdue beyond the specified period irrespective of the terms agreed with the enterprises. The Company has initiated the process of identification of such suppliers. In view of no. of suppliers & no receipt of critical inputs & response from several such potential parties, the liability of interest cannot be reliable estimated nor can required disclo- sure be made. Accounting in this regard will be carried out after process is complete and reliable estimate can be made in this regard. Since the Company is regular in making payments to all suppliers, the management does not anticipate any significant interest liability.

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