Notes to Accounts of Pact Industries Ltd.

Mar 31, 2017

A. Key Management Personnel and relatives of Key Management Personnel:

1. Key Management Personnel:

Harpreet Singh

2. Relatives of Key Management Personnel

Charanpreet Singh, Gurdeep Singh, TanuPreet Kaur, Avtar Singh

B. Associates:

i) Taksonz Developers & Infrastructure Ltd.

ii) Kartarz Alloys P.Ltd.

iii) Preet Overseas

iv) Kartarz Hotel Estates P.Ltd.

v) Avtar Singh & Sons

vi) Parav Knitwear

vii) Tarunjeet Singh & Sons

viii) Preet Fabrics

ix) H.S.Knitwear

x) Gurdeep Singh & Sons

xi) Harpreet Singh & Sons

xii) Takkar Knit Fab

xiii) Kartar Alloys P.Ltd.

Pursuant to Accounting Standard (AS-22) - Accounting for Taxes on Income. The company has recorded a net accumulative deferred Tax Liability of Rs. 427517.00 up to 31.03.2016. Further impact of deferred tax Liability of Rs.369871.00 for the year ended 31.03.2017 has been debited to Profit & Loss Account making the total exposure of deferred tax Liability Rs.797388.00 as on year ended 31.03.2017. A detailed bifurcation between current tax and deferred tax charge is made at the year end.

Exchange difference earnings : During the year company has made an import of scrap(raw material) having CIF value of such import is Rs.2,71,26,873/-. The fluctuation/ foreign exchange difference has already has been debited to purchase account.

---

Mar 31, 2015

1. General Information :

Balance Sheet, Profit & Loss Accounts have been drawn on 31.03.2015 comprising of 12 months. (from 01.04.2014 to 31.03.2015) and previous year figures have been drawn as on 31.03.2014 comprising of 12 months (from 01.04.2013 to 31.03.2014).

2. Depreciation

The Company has provided for depreciation at the rates specified in Schedule XIV to the Companies Act, 1956, except in cases of the following assets, which are depreciated at commercial rates, which are higher than the rates specified in Schedule XIV.

3. Investments

Long term investments are stated at cost less provision for diminution in the value of such investments. Diminution in value is provided for where the management is of the opinion that the diminution is of permanent nature. Short term investments are valued at lower of cost and net realizable value

4. Borrowing costs

Borrowing costs directly attributable to acquisition or construction of fixed assets, which necessarily take a substantial period of time to get ready for their intended use are capitalised. Borrowing cost which are not relatable to qualifying asset are recognized as an expense in the period in which they are incurred.

Previous Year figures ended on 31.03.2014 have been given and same have been regrouped/rearranged for comparison.

Contingent Liabilities not provided for in respect of business during the year is NIL.

5. Debtors &Creditors Confirmations

The use of confirmation evidence is usually very important in the audit of trade debtors & creditors because there are few other sources of external corroborative evidence. It is usually suitable when the majority of the credit customers are reasonable-sized businesses because existence is an important assertion being verified, it is important that the source from which the sample is selected is tested for completeness. This usually requires selecting the sample from a list of balances that has been tested against the sales & purchase ledger respectively and totaled and agreed with the general ledger balance of debtor & creditors, Loans and advances are subject to confirmation and are taken/included in financial statement on the basis of entries in the books of accounts of the concern.

6. Operating Expenses

Auditor's remuneration

Auditor's remuneration in relation to the company statutory audit amounts to Rs 25000.00. The following fees were payable by the company to their principal auditor, m/s Rajesh Mehru & Co.:

The Directors have been appointed for a period of five years from their respective dates of appointment. The details of remuneration paid to the Executive Directors for the financial year ending 31st March 2015, are as under:

7. Key Management Personnel and relatives of Key Management Personnel:

1. Key Management Personnel:

Gurdeep Singh, Managing Director

Harpreet Singh, Managing Director

Sakshi Sharma, Company Secretary

2. Relatives of Key Management Personel

Charanpreet Singh, Gurdeep Singh, TanuPreet Kaur,

8. Associates:

i) Taksonz Developers & Infrastructure Ltd.

ii) Kartarz Alloys P.Ltd.

iii) Preet Overseas

iv) Kartarz Hotel Estates P.Ltd.

9. No personal expenditure has been debited in the books of accounts.

C.I.F. value of imports : $1981521

10. Exchange difference earnings : During the year company has made an import of scrap (raw material), and any fluctuation/ foreign exchange difference has already has been debited to purchase account.s

---

Mar 31, 2014

General Information :

Balance Sheet, Profit & Loss Accounts have been drawn on 31.03.2014 comprising of 12 months. (from 01.04.2013 to 31.03.2014) and previous year figures have been drawn as on 31.03.2013 comprising of 12 months (from 01.04.2012 to 31.03.2013).

Depreciation

The Company has provided for depreciation at the rates specified in Schedule XIV to the CompaniesAct, 1956, except in cases of the following assets, which are depreciated at commercial rates, whichare higher than the rates specified in Schedule XIV.

Investments

Long term investments are stated at cost less provision for diminution in the value of such investments. Diminution in value is provided for where the management is of the opinion that the diminution is of permanent nature. Short term investments are valued at lower of cost and net realizable value

Borrowing costs

Borrowing costs directly attributable to acquisition or construction of fixed assets, which necessarily take a substantial period of time to get ready for their intended use are capitalised. Borrowing cost which are not relatable to qualifying asset are recognized as an expense in the period in which they are incurred.

Previous Year figures ended on 31.03.2013 have been given and same have been regrouped/rearranged for comparison.

Contingent Liabilities not provided for in respect of business during the year is NIL.

Debtors &Creditors Confirmations

The use of confirmation evidence is usually very important in the audit of trade debtors & creditors because there are few other sources of external corroborative evidence. It is usually suitable when the majority of the credit customers are reasonable-sized businesses because existence is an important assertion being verified, it is important that the source from which the sample is selected is tested for completeness. This usually requires selecting the sample from a list of balances that has been tested against the sales & purchase ledger repectivley and totaled and agreed with the general ledger balance Balance of debtor & creditors, Loans and advances are subject to confirmation and are taken/included in financial statement on the basis of entries in the books of accounts of the concern.

Operating Expenses

Auditor''s remuneration

Auditor''s remuneration in relation to the company statutory audit amounts to Rs 25000.00. The following fees were payable by the company to their principal auditor, M/S Rajesh Mehru & Co.:

---

Mar 31, 2013

General Information :

Balance Sheet. Profit & Loss Accounts have been drawn on 31 03 2013 comprising of 12 months, (from 01.04 2012 to 31.03.2013) and previous year figures have been drawn as on 31.03.2012 comprising of 12 months (from 01 04 2011 to 31.032012).

---

Mar 31, 2012

1. Balance Sheet, Profit & Loss Accounts have been drawn on 31.03.2012 comprising of 12 Months. (From 01.04.2011 to 31.03.2012) and previous year figures have been drawn as on 31.03.2011 comprising of 12 months (from 01.04.2010 to 31.03.2011).

2. INVESTMENTS & SECURITIES :

All the investments made by the company have been shown on the book value.

3. Previous Year figures ended on 31.03.2011 have been given and same have been regrouped/rearranged for comparison.

4. Contingent Liabilities not provided for in respect of business during the year is NIL.

5. Balance of debtor & Creditors, Loans and advances are subject to confirmation and are taken/included in financial statement on the basis of entries in the books of accounts of the concern.

Pursuant to Accounting Standard (AS-22) – Accounting for Taxes on Income. The company has recorded a net accumulative deferred Tax Liabilities of Rs. Nil up to 31.03.2011. Further impact of deferred tax liability of Rs. 45755.00 for the year ended 31.03.2012 has been debited to Profit & Loss Account making the total exposure of deferred tax liability Rs. 45755.00/- as on yr ended 31.03.2012.

6. Most of the expenses have been made on actual basis & provisions of expenses have been estimated on prorate basis.

7. No personal expenditure has been debited in the books of accounts.

8. Exchange difference earnings/Loss:

The exchange difference gain/loss on purchase of material is adjusted in the purchase. The gain/loss on export is nil as there is no Export of the goods.

9. Earning in Foreign Exchange :

Nil as there is no Export of the goods.

---

Mar 31, 2011

1. Balance Sheet, Profit & Loss Accounts have been drawn on 31.03.2011 Comprising of 12 Months. (from 01.04.2010 to 31.03.2011) and previous year figures have been drawn on 31.03.2010 comprising of 12 months (from 01.04.2009 to 31.03.2010).

2. INVESTMENTS & SECURITIES :

All the investments made by the company have been shown on the book value.

3. Previous Year figures ended on 31.03.2010 have been given and same have been regrouped/rearranged for comparison.

4. Contingent Liabilities not provided for in respect of business during the year is NIL.

5. Balance of debtor & Creditors, Loans and advances are subject to confirmation and are taken/included in financial statement on the basis of entries in the books of accounts of the concern.

6. Most of the expenses have been made on actual basis & provisions of expenses have been estimated on prorate basis.

7. No personal expenditure has been debited in the books of accounts.

8. Preliminary expenses written off NIL

9. C.I.F. value of imports. NIL

10. Expenditure in foreign exchange NIL

11. Earning in Foreign Exchange NIL