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Notes to Accounts of Pacific Industries Ltd.

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, 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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