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Notes to Accounts of Panama Petrochem Ltd.

Mar 31, 2015

A. Terms/rights attached to equity shares

The company has only one class of equity shares having a par value of Rs. 2 per share (2014: Rs. 10 per share). Each holder of equity shares is entitled to one vote per share, however the holders of global depository receipts (GDR's) do not have any voting rights in respect of shares represented by the GDR's till the shares are held by the custodian bank (Refer Note 35). The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The amount of per share dividend recognized as distributions to equity shareholders is Rs. 2 (face value Rs. 2) [31 March 2014 : Rs. 6 (face value Rs. 10)]

In the event of liquidation of the company, the holders of equity shares will be entitled to receive assets in proportion to the number of equity shares held by the shareholders.

Terms of Securities and repayment

Cash credit from banks is secured against the hypothecation of Stocks, Book debts and Plant & Machineries (both present & future), Pledge of Fixed Deposit Receipts, Further secured by Equitable Mortgage of Company's present Immoveable Property situated at Ankleshwar, Daman, Marol industrial estate, property of group companies situated at Navi Mumbai, property belonging to the Directors and corporate gurantee given by Anirudh Distributors Private Limited (Refer Note 43). The cash credit is repayable on demand and carried an interest rate of 12% to 16% p.a

31 March 2015 31 March 2014 Rs. In lakhs Rs. In lakhs

2. Contingent Liabilities

i) Service tax Matter disputed with the Deputy Commissioner of Service Tax (Dispute regarding demand raised on service tax payable on interest on usance charges for the period September 2008 to March 2013) 80.71 58.25

ii) Excise duty Matter disputed with the Commissioner of Central Excise, Customs & Service Tax, Daman,(Dispute regarding demand raised on excise duty not recovered on freight charged to customers) 99.64 99.64

iii) Custom duty Matter disputed Customs, Excise and Service Tax Appellate Tribunal, Mumbai, (Dispute regarding demand raised for classification of product) 126.70 126.70

iv) Bank Gurantees 546.17 339.60

(The contingent liabilities, if materialized, shall entirely be borne by the company, as there is no likely reimbursement from any other party.)

3. Current Liabilities & Provisions

In the opinion of the Board, adequate provision has been made for all known liabilities and the same is not in excess of the amounts considered reasonably necessary.

4. Current assets, loans and advances

In the opinion of the Board, the current assets, loans and advances have value on realization in the ordinary course of business, at least equal to the amount at which they are stated in the Balance Sheet.

5. Shares Split Information

a. Pursuant to resolution passed at the Annual General Meeting of the company held on 4 September 2014, the Company sub-divided its shares of face value of Rs. 10 each into five shares of Rs. 2 each. Accordingly as per resolution, read with amendments made to Memorandum of Assocation as required by Companies Act, 2013. Authorized share capital of the company stands at Rs. 2,555 lakhs i.e. 1,277.5 lakhs shares of Rs. 2 each as compared to 255.5 lakhs shares of Rs. 10 each last year.

b. Each GDR of the company, representing five equity shares of Rs. 10 each, post stock split, now has underlying One GDR representing twenty five equity shares of face value of Rs. 2 each.

c. Consequently, the earning per share has been restated for the previous year based on the number of equity shares post split, in accordance with Accounting Standard (AS-20) on "Earnings Per Share".

6. In accordance with section 77A, 77AA and 77B of the Companies Act, 1956 and in pursuant to the buy-back announcement dated 1 March 2013, the Company bought back a total of 5,53,522 Equity Shares during the period 14 February 2013 to 13 February 2014. All the shares have been duly extinguished before 31 March 2014. Consequently, an amount of Rs. 55.36 lakhs, being the nominal value of equity shares bought back had been transferred to Capital Redemption Reserve from the Profit and Loss Statement upto 31 March 2014. Further, a total amount of Rs. 732.61 lakhs being the premium on buy-back had also been appropriated from General Reserve upto 31 March 2014.

7. Global Depository Receipts ('GDRs') issue

On 20 July 2011, the Company raised US $ 1,39,99,985 (Rs. 6,233.79 lakhs) through issuance of 4,91,469 GDRs representing 24,57,345 equity shares of Rs. 10 each at a price of Rs. 253.68 per equity share of Rs. 10 each. The issue price of each GDR is US $ 28.486 and the GDRs are listed on the Luxembourg Stock Exchange. The holders of GDR do not have voting rights with respect to the shares represented by the GDRs, but rank pari passu with the existing share holders in all respect including entitlement of dividend declared. The Company has paid Rs. Nil (31 March 2014 : Rs. 11.49 lakhs) on account of issue expenses towards the issue of Global Depository Receipts , which has been incurred for issue of GDR, and same has been adjusted against Securities Premium during the previous year.

8. Expenditure related to Corporate Social Responsibility as per Section 135 of the Companies Act, 2013 read with Schedule VII thereof : Rs. 57.78 Lakhs is included in donation and charity.

9. Employee Benefits

General Description of Defined Benefit plan Gratuity

The Company operates single type of Gratuity plans wherein every employee is entitled to the benefit equivalent to fifteen days salary last drawn for each completed year of service depending on the date of joining and eligibility terms. The same is payable on termination of service or retirement whichever is earlier. The benefit vests after five years of continuous service.

The following tables summaries the components of net benefit expense recognized in the profit and loss statement and the funded status and amounts recognized in the balance sheet for the respective plans.

10. Segment Information Business Segments :

As the Company is in the business of manufacturing and trading of specialty petroleum products, the Company has considered petroleum products as the only business segment for disclosure in this context of accounting standard 17.

Geographical Segments :

The following table shows the distribution of the Company's sales by geographical market, regardless of where the goods were produced:

11. Related party disclosures as required under AS-18, "Related Party Disclosures", are given below: (a) Names of related parties with whom transactions have taken place during the year Key Management Personnel

Amirali E Rayani Amin A Rayani Samir Rayani

Relatives of key management personnel

Akbarali Rayani (Brother of Mr. Amirali E Rayani)

Vazirali Rayani (Brother of Mr. Amirali E Rayani)

Salimali Rayani (Brother of Mr. Amirali E Rayani)

Arif Rayani (Brother of Mr. Amin Rayani)

Nilima Kheraj (Sister of Mr. Samir Rayani)

Subsidiary

Panol Industries RMC FZE, UAE

Enterprises owned or significantly influenced by key management personnel or their relatives

Anirudh Distributors Private Limited

12. Taxation

Minimum Alternate Tax (MAT) :-The Company has during the year, provided the current year tax liability of Rs. 369.09 lakhs (previous year Rs. 429 lakhs) calculated in accordance with the normal rate of income of tax. However, the tax liability for the previous year is calculated as per the provisions of Section 115JAA of the Income Tax Act, 1961. The MAT credit entitlement of Rs. 182.25 lakhs has been reversed during the year and Rs. 76.62 lakhs has been availed for the year ended 31 March 2015, which is disclosed under 'Loans and advances'

13. Previous year figures

The company has reclassified previous year figures to conform to this year's classification.


Mar 31, 2014

1. Employee benefits

General Description of Defined benefit plan

Gratuity

The Company operates single type of Gratuity plans wherein every employee is entitled to the benefit equivalent to ffteen days salary last drawn for each completed year of service depending on the date of joining and eligibility terms. The same is payable on termination of service or retirement whichever is earlier. The benefit vests after five years of continuous service.

The following tables summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the respective plans.

The estimates of future salary increases, considered in actuarial valuation, take account of infation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

The over all expected rate of return on assets is determined based on the market prices prevailing as on that date, applicable to the period over which the obligation is expected to be settled.

2. Segment Information

Business Segments:

As the Company is in the business of manufacturing and trading of specialty petroleum products, the Company has considered petroleum products as the only business segment for disclosure in this context of accounting standard 17.

31 March 2014 31 March 2013 Rs. In lakhs Rs. In lakhs

3. Contingent Liabilities

i) Service tax Matter disputed with the Deputy Commissioner of Service Tax (Dispute regarding demand raised on service tax payable on interest on usance charges for the period September 2008 to March 2014) 58.25 10.88

ii) Bank Gurantees 339.60 259.86

(The contingent liabilities, if materialized, shall entirely be borne by the company, as there is no likely reimbursement from any other party.)

4. Related party disclosures as required under AS-18, "Related Party Disclosures'', are given below: (a) Names of related parties with whom transactions have taken place during the year Key Management Personnel

Amirali E Rayani

Amin A Rayani

Samir Rayani

Hussein Rayani (Resigned w.e.f. 25/03/2013)

Relatives of key management personnel

Akbarali Rayani (Brother of M r. Amirali E Rayani) Vazirali Rayani (Brother of Mr. Amirali E Rayani) Salimali Rayani (Brother of Mr. Amirali E Rayani)

41. In accordance with section 77A, 77AA and 77B of the Companies Act, 1956 and pursuant to the buy back announcement made by the Company on 1st March 2013, the Company has bought back from open market through stock exchanges 541,757 (31 March 2013 : 11,765) equity shares of Rs. 10 each during the year for a total consideration of Rs. 772.08 lakhs (31 March 2013 : Rs. 15.88 lakhs) of this, the Company has extinguished 550,322 (31 March 2013 : 3,200) equity shares have been extinguished. Consequently, an amount of Rs. 32.90 lakhs (31 March 2013 : Rs. 1.18 lakhs) being the nominal value of equity shares bought back has been transferred to Capital Redemption Reserve from profit & loss account. An amount of Rs. 717.91 lakhs (31 March 2013 : Rs. 14.70 lakhs) being the premium on buyback has been appropriated from General Reserve.

5. Taxation

Minimum Alternate Tax (MAT) :-The Company has during the year, provided the current year tax liability of Rs. 429 lakhs (previous year Rs. 260 lakhs) calculated in accordance with the provisions of Section 115JAA of the Income Tax Act, 1961. The MAT credit entitlement of Rs. 47.66 lakhs has been reversed during the year and availed Rs. 311.66 lakhs has been availed for the year ended March 31 2013, which is disclosed under ''Loans and advances''.

6. Previous year figures

The company has reclassified previous year figures to conform to this year''s classification.


Mar 31, 2013

1. Corporate Information

Panama Petrochem Limited (the company) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The company is engaged in the manufacture of specialty petroleum products for diverse user industries like printing, textiles, rubber, pharmaceuticals, cosmetics, power and other industrial oil.

2. Basis of preparation

The fnancial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these fnancial statements to comply in all material respects with the Accounting Standards notifed by Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The fnancial statements have been prepared under the historical cost convention.

The accounting policies adopted in the preparation of fnancial statements are consistent with those of previous year.

3. Employee Benefts

General Description of Defned Beneft plan Gratuity

The Company operates single type of Gratuity plans wherein every employee is entitled to the beneft equivalent to ffteen days salary last drawn for each completed year of service depending on the date of joining and eligibility terms. The same is payable on termination of service or retirement whichever is earlier. The beneft vests after fve years of continuous service.

The following tables summaries the components of net beneft expense recognized in the statement of proft and loss and the funded status and amounts recognized in the balance sheet for the respective plans.

4. Leases

Operating Lease: company as lessee

The Company has entered into arrangements for taking on leave and license basis certain offce premises and warehouses. The specifed disclosure in respect of these agreements is given below :

5. Segment Information

Business Segments:

As the Company is in the business of manufacturing of specialty petroleum products, the Company has considered petroleum products as the only business segment for disclosure in this context of accounting standard 17.

Geographical Segments :

The following table shows the distribution of the Company''s consolidated sales by geographical market, regardless of where the goods were produced:

6. Contingent Liabilities

31 March 31 March 2013 2012 Rs. In Lakhs Rs. In Lakhs

i) Service tax Matter disputed 10.88 10.88

with the Deputy Commissioner of Service Tax

(Dispute regarding demand raised on service tax payable on interest on usance charges for the period September 2008 to November 2009)" 10.88 10.88

(The contingent liabilities, if materialized, shall entirely be borne by the company, as there is no likely reimbursement from any other party.)

7. Related party disclosures as required under AS- 18, "Related Party Disclosures'', are given below:

a) Names of related parties with whom transactions have taken place during the year

Key Management Personnel

Amirali E Rayani Amin A Rayani Samir Rayani Hussein Rayani

Relatives of key management personnel

Akbarali Rayani (Brother of M r. Amirali E Rayani)

Vazirali Rayani (Brother of M r. Amirali E Rayani)

Salimali Rayani (Brother of M r. Amirali E Rayani)

Arif Rayani (Brother of M r. Amin Rayani)

Nilima Kheraj (Sister of M r. Samir Rayani)

Iqbal Rayani (Brother of M r. Hussien Rayani)

Munira Rayani (Wife of Hussein Rayani)

Enterprises owned or signifcantly infuenced by key management personnel or their relatives

Anirudh Distributors Pvt. Ltd.

Ittefaq Ice & Cold Storage Co. Pvt. Ltd.

Panama Builders & Developers Pvt. Ltd.

8. Global Depository Receipts (''GDRs'') issued during the year

On July 20, 2011, the Company raised USD 13,999,985 (Rs. 6,233.79 lakh) through issuance of 491,469 GDRs representing 2,457,345 equity shares of Rs. 10 each at a price of Rs. 253.68 per equity share of Rs. 10 each. The issue price of each GDR is USD 28.486 and the GDRs are listed on the Luxembourg Stock Exchange. The holders of GDR do not have voting rights with respect to the shares represented by the GDRs, but rank pari passu with the existing share holders in all respect including entitlement of dividend declared. The Company has incurred Rs. Nil (Previous Year Rs. 97.30 Lakhs) on account of issue expenses towards the issue of Global Depository Receipts, has been adjusted against Securities Premium.

9. Dividend in respect to previous year represent dividend of Rs. 5/- per share paid to the holders of GDR, which were issued subsequent to the declaration of dividend and adoption of account for the year ended March 31, 2011, and were outstanding on the book closure date.

10. In accordance with section 77A, 77AA and 77B of the Companies Act, 1956 and pursuant to the buy back announcement made by the Company on 1st March 2013, the Company has bought back from open market through stock exchanges 11,765 equity shares of Rs. 10 each during the year for a total consideration of Rs. 15.88 Lakhs. of this, the Company has extinguished 3200 equity shares till 31st March, 2013 and 8,565 equity shares have been extinguished subsequent to the balance sheet date. Consequently, an amount of Rs. 1.18 Lakhs being the nominal value of equity shares bought back has been transferred to Capital Redemption Reserve from proft & loss account. An amount of Rs. 14.70 Lakhs being the premium on buyback has been appropriated from General Reserve.

11. Taxation

"Minimum Alternate Tax (MAT) :- The Company has during the year, provided the current year tax liability of Rs. 260 Lakhs (previous year Rs. Nil) calculated in accordance with the provisions of Section 115JAA of the Income Tax Act, 1961. The MAT credit entitlement in respect of MAT liability for the current and earlier years has been assessed Rs. 312.79 Lakhs as at March 31, 2013 and is disclosed under ''Loans and advances''.

12. Previous year fgures

The company has reclassifed previous year fgures to conform to this year''s classifcation.


Mar 31, 2012

1. Corporate Information

Panama Petrochem Limited (the company) is a public limited company domiciled in India and incorporated under the provisions of the Companies Act, 1956. The company is engaged in the manufacture of specialty petroleum products for diverse user industries like printing, textiles, rubber, pharmaceuticals, cosmetics, power and other industrial oil.

2. Basis of preparation

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP). The company has prepared these financial statements to comply in all material respects with the Accounting Standards notified by Companies (Accounting Standards) Rules, 2006, (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared under the historical cost convention.

The accounting policies adopted in the preparation of financial statements are consistent with those of previous year except change in accounting policy as explained below.

a. 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, however the holders of global depository receipts (GDR's) do not have any voting rights in respect of shares represented by the GDR's till the shares are held by the custodian bank (Refer Note 41). The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

The amount of per share dividend recognized as distributions to equity shareholders is Rs 5/- (31 March 2011 : Rs 5/-)

In the event of liquidation of the company, the holders of equity shares will be entitled to receive assets in Cash credit from banks is secured against the hypothecation of Stocks, Book debts and Plant & Machineries (both present & future), Pledge of Fixed Deposit Receipts, Further secured by Equitable Mortgages of Company's present Immoveable Property situated at Daman, Marol industrial estate, property of group companies situated at Navi Mumbai, and property belonging to the Directors. The cash credit is repayable on demand and carried an interest rate of 12% to 16% p.a.

# Excise duty on sales amounting to Rs 4,587.55 lakhs (31 March 2011 : Rs 3,786.67 lakhs) has been reduced from sales in profit and loss and excise duty on increase decrease in stock amounting to Rs (21.60) lakhs (31 March 2011 : Rs 2.84 lakhs) has been considered as (income)/expense in note 23 of financial statements.

3. Employee Benefits

General Description of Defined Benefit plan Gratuity

The Company operates single type of Gratuity plans wherein every employee is entitled to the benefit equivalent to fifteen days salary last drawn for each completed year of service depending on the date of joining and eligibility terms. The same is payable on termination of service or retirement whichever is earlier. The benefit vests after five years of continuous service.

The following tables summaries the components of net benefit expense recognized in the statement of profit and loss and the funded status and amounts recognized in the balance sheet for the respective plans.

The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

The over all expected rate of return on assets is determined based on the market prices prevailing as on that date, applicable to the period over which the obligation is expected to be settled.

4. Leases

Operating Lease: company as lessee

The Company has entered into arrangements for taking on leave and license basis certain office premises and warehouses. The specified disclosure in respect of these agreements is given below :

Notes:

(i) There is no escalation clause in the lease agreement

(ii) There are no restrictions imposed by lease arrangements

(iii) There are no subleases

5. Capitalization of expenditure

During the year, the company has capitalized the following expenses to the cost of fixed assets. Consequently, expenses disclosed under the respective notes are net of amounts capitalized by the company.

6. Segment Information

Business Segments:

As the Company is in the business of manufacturing of specialty petroleum products, the Company has considered petroleum products as the only business segment for disclosure in this context of accounting standard 17.

Geographical Segments:

The following table shows the distribution of the Company's consolidated sales by geographical market, regardless of where the goods were produced:

Notes :

Geographical Segment :

a) For the purpose of geographical segment the sales are divided into two segments - India and outside India.

b) The accounting policies of the segments are the same as those described in Note 2.1

7. Contingent Liabilities

31 March 31 March 2012 2011 Rs In lakhs Rs In lakhs

Claims against the Company not acknowledged as debts:

i) Income Tax Matter in appeal with tribunal (AY 06-07) (Amount paid 24.61) - 24.96

(Dispute relating the provisions of Section 145 A of the Income Tax Act, 1961 relating to the AY 06-07 pending in the Income Tax Appellate Tribunal.)"

ii) Service tax Matter disputed with the Deputy Commissioner of Service Tax 10.88 - (Dispute regarding demand raised on service tax payable on interest on usance charges for the period September 2008 to November 2009) 10.88 24.96

(The contingent liabilities, if materialized, shall entirely be borne by the company, as there is no likely reimbursement from any other party.)

8. Global Depository Receipts ('GDRs') issued during the year

On July 20, 2011, the Company raised USD 13,999,985 (Rs 6,233.79 lakh) through issuance of 491,469 GDRs representing 2,457,345 equity shares of Rs10 each at a price of Rs 253.72 per equity share of Rs 10 each. The issue price of each GDR is USD 28.486 and the GDRs are listed on the Luxembourg Stock Exchange. The holders of GDR do not have voting rights with respect to the shares represented by the GDRs, but rank pari passu with the existing share holders in all respect including entitlement of dividend declared. The Company has incurred Rs 97.30 lakhs on account of issue expenses towards the issue of Global Depository Receipts of which Rs 84.11 lakhs incurred in the current year, has been adjusted against Securities Premium.

9. Dividend in respect to previous year represent dividend of Rs 5/- per share paid to the holders of GDR, which were issued subsequent to the declaration of dividend and adoption of account for the year ended March 31, 2011, and were outstanding on the book closure date.

10. Amalgamation of Monaco Petroleum Private Limited with the Company

a) In previous year ended March 31, 2011 pursuant to the scheme of amalgamation (the Scheme) of the erstwhile Monaco Petroleum Private Limited (MPPL) (hereinafter referred to as transferor company) with Panama Petrochem Limited (PPL) ( hereinafter referred as transferee company), as approved by the members at a court convened meeting approved by the shareholders of the Company and MPPL and subsequently sanctioned by the Hon'ble High Courts of Gujarat vide its order dated 23rd March 2011, the assets and liabilities of MPPL have been transferred to and vested in the Company with retrospective effect from April 01, 2010 (the Appointed date). The Scheme has accordingly been given effect to in the accounts in the previous year.

In accordance with the scheme of amalgamation, the difference between the share capital issued and the net assets taken over is adjusted in general reserve.

Had the treatment based on Accounting Standard 14- "Accounting for Amalgamation" been followed, Security Premium would have been higher by Rs 1,022.71 Lakhs and General Reserve would have been lower by Rs 1,022.71 Lakhs.

b) Monaco Petroleum Private Limited (MPPL), (the amalgamating company) engaged in manufacturing of Petrochemicals, having plant in Taloja.

c) The arrangement has been accounted for under the "pooling of interest" method as prescribed by Accounting Standard (AS 14), "Accounting for Amalgamation". Accordingly the assets, liabilities and other reserve of MPPL as on April 1, 2010 have been aggregated at their book value as specified in the Scheme.The difference between the amount recorded as share capital issued by the Company as consideration for the merger and the amount of share capital of the MPPL has been adjusted in the General Reserve Account of the Company in accordance with the scheme.

d) 321,750 Equity Shares of Rs 10/- each fully paid up are to be issued to the equity share holder of the MPPL whose names are registered in the register of members on record date, without payment being received in cash. Pending allotment, the face value of such shares has been shown as "Share Capital Suspense Account" which has been allotted in the current year.

11. Previous year figures

Till the year ended March 31, 2011, the company was using pre-revised Schedule VI to the Companies Act 1956, for preparation and presentation of its financial statements. During the year ended March 31, 2012, the revised Schedule VI notified under the Companies Act 1956, has become applicable for the company. The company has reclassified previous year figures to conform to this year's classification.


Mar 31, 2011

1 (a) Nature of Operations

Panama Petrochem Limited is engaged in the manufacture of specialty petroleum products for diverse user industries like printing, textiles, rubber, pharmaceuticals, cosmetics, power and other industrial oil.

( Rs. Rs.000)

2 Contingent Liabilities not 31.03.2011 31.03.2010 provided for

Claims against the Company not acknowledged as debts:

Service Tax Matter - 930

Income Tax Matter in appeal

with tribunal (AY 06-07)

(Amount paid Rs. 1,248) 2,496 2,496

Bank Guarantee 14,722 8,631

(The contingent liabilities, if materialised, shall entirely be borne by the company, as there is no likely reimbursement from any other party.)

3 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) 53,113 72,060

4 Major Components of deferred tax assets/ (liabilities) arising on account of timing

differences are :

Deferred Tax Asset :

a. Employee Retirement and

other Long term benefits 843 907

b. Provision for doubtful

debt/advances 2,009 181

c. Allowed in the Income tax on payment basis and other timing differences - 2,691

2,852 3,779

Deferred Tax Liability :

Difference in depreciation and other differences in block 12,028 1,381 of fixed assets as per tax books and financial books

12,028 1,381

5 Net Deferred Tax Asset / (Liability) (9,176) 2,398

Legal & Professional

charges includes Auditors'

remuneration :

(excluding service tax, where

applicable)

As auditor:

- Audit fees 1,100 500

- Limited Review fees 600 -

- Out of Pocket expenses 48 -

Tax audit Fees 20 20

Others - 50

1,768 570

6 Managerial remuneration under Section 198 of the Companies Act, 1956

Salary 5,550 1,386

Perquisites 1,648 1,327

7,198 2,713

Note: As the liabilities for gratuity are provided on an actuarial basis for the Company as a whole, the amounts pertaining to the directors are not included above. Similarly group mediclaim insurance taken for all employees of the Company as a whole are not included above.

7 Employee Benefits

General Description of Defined Benefit plan Gratuity

The Company operates single type of Gratuity plans wherein every employee is entitled to the benefit equivalent to ffteen days salary last drawn for each completed year of service depending on the date of joining and eligibility terms. The same is payable on termination of service or retirement whichever is earlier. The benefit vests after five years of continuous service. The following tables summaries the components of net benefit expense recognised in the profit and loss account and the funded status and amounts recognised in the balance sheet for the respective plans.

8a The Company has availed the exemption as per the notification dated February 8, 2011 issued by Ministry of Corporate Affairs and accordingly, the additional information pursuant to the provision of paragraphs 3(i)(a), 3(ii)(a), 3(ii)(b), 3(ii)(d), of Part II of Schedule VI to the Companies Act, 1956 has not been disclosed in the financial statement.

9 Related party disclosures as required under AS-18, "Related Party Disclosures', are given below:

(a) Names of related parties with whom transactions have taken place during the year

Key Management Personnel

1 Amirali E Rayani

2 Amin A Rayani

3 Samir Rayani

Relatives of key management personnel

1 Akbarali Rayani (Brother of Mr. Amirali E Rayani)

2 Vazirali Rayani (Brother of M r. Amirali E Rayani)

3 Salimali Rayani (Brother of M r. Amirali E Rayani)

4 Arif Rayani (Brother of Mr. Amin Rayani)

5 Nilima Kheraj (Sister of Mr. Samir Rayani)

6 Hussein Rayani (Brother of Mr. Amin Rayani)

7 Iqbal Rayai (Brother of Mr. Amin Rayani)

8 Munira Rayani (Daughter in law of Amirali E Rayani)

Enterprises owned or significantly infuenced by key management personnel or their relatives

1 Anirudh Distributors Pvt. Ltd.

2 Ittefaq Ice & Cold Storage Co. Pvt. Ltd.

3 Panama Petroleum Products

4 Panama Builders & Developers Pvt. Ltd.

5 Asiatic Corporation

10 Segment Information :

Business Segments:

As the Company is in the business of manufacturing of speciality petroleum products, the Company has considered petroleum products as the only business segment for disclosure in this context of accounting standard 17 issued by the institute of Chartered Accountants of India.

11 Amalgamation of Monaco Petroleum Private Limited with the Company

a Pursuant to the scheme of amalgamation (the Scheme) of the erstwhile Monaco Petroleum Private Limited (MPPL) (hereinafter referred to as transferor company) with Panama Petrochem Limited (PPL) (hereinafter referred as transferee company), as approved by the members at a court convened meeting approved by the shareholders of the Company and MPPL and subsequently sanctioned by the Hon'ble High Courts of Gujarat vide its order dated 23rd March 2011, the assets and liabilities of MPPL have been transferred to and vested in the Company with retrospective effect from April 01, 2010 (the Appointed date). The Scheme has accordingly been given effect to in these accounts.

In accordance with the scheme of amalgamation, the difference between the share capital issued and the net assets taken over is adjusted in general reserve. Had the treatment based on Accounting Standard 14- "Accounting for Amalgamation" been followed, Security Premium would have been higher by Rs. 102,271 thds and General Reserve would have been lower by Rs. 102,271 thds.

b Monaco Petroleum Private Limited (MPPL), (the amalgamating company) engaged in manufacturing of Petrochemicals, having plant in Taloja.

c The arrangement has been accounted for under the "pooling of interest" method as prescribed by Accounting Standard (AS 14), "Accounting for Amalgamation". Accordingly the assets, liabilities and other reserve of MPPL as on April 1, 2010 have been aggregated at their book value as specified in the Scheme.The difference between the amount recorded as share capital issued by the Company as consideration for the merger and the amount of share capital of the MPPL has been adjusted in the General Reserve Account of the Company in accordance with the scheme.

d 321,750 Equity Shares of Rs 10/- each fully paid up are to be issued to the equity share holder of the MPPL whose names are registered in the register of members on record date, without payment being received in cash. Pending allotment, the face value of such shares has been shown as "Share Capital Suspense Account".

e From the effective date the authorized share capital will stand increased by Rs. 5,500 ('000) consisting of 5,50,000 Equity shares of Rs 10 each.

The figure for the current year includes fgures of Monaco Petroleum Private Limited (MPPL) which is amalgamated with the Company with effect from April 1, 2010 and are therefore to that extent not comparable with those of previous year.

12 Excise duty on sales amounting to Rs. 378,667 P.Y. ( Rs.267,573) has been reduced from sales in profit & loss account and excise duty on decrease/(increase) in stock amounting to Rs. 284 P.Y. ( Rs. (1,862)) has been considered as expense/(Income) in Schedule 14 of financial statements.

13. The figures of the previous year were audited by a Firm of Chartered Accountants other than S.R. Batliboi & Co. The fgures in respect of the previous year have been regrouped, wherever necessary to conform to this year's classification.


Mar 31, 2010

1. In pursuance to the Special Resolution passed in the Annual General Meeting held on 29th September, 2007 the Company had received 10% upfront money from the promoters amounting to Rs.63.75 Lacs in the FY. 2007-08 against the issue on preferential basis of 4,25,000 Share Warrants carrying an option/entitlement to subscribe equivalent number of equity shares of Rs. 10 each on a future date not exceeding 18 months i. e. 30th- June 2009 from the date of issue at a conversion price of Rs. 150 per share including premium of Rs. 140 per share. However, on expiry of the said time limit and option not been exercised, the said amount was forfeited during the year by Company.

2. Contingent Liabilities

As at the As at the

year ended year ended 31/03/2010 31/03/2009 (RS;) (Rs.)

(a) Disputed Income-Tax 24.96 Lacs 26.98 Lacs Liability in appeal

(b) Bank Guarantee 86.31 Lacs 77.69 Lacs

(c) Letter of Credit Facility 9826.14 Lacs 10286.45 Lacs

(d) Disputed Service Tax 9.30 Lacs Nil

Liability

The Company does not expect any liability to devolve on it on account of the above referred contingent liabilities and therefore no provision is held.

3. Estimated amount of Contracts remaining to be executed on Capital Account & not provided for (Net of Advances paid) is Rs. 720.60 Lacs (P.Y. Rs.2,992.52 Lacs).

4. As per the Revised Accounting Standard 15 "Employees Benefits", the disclosure of employee benefits as defined in the Accounting Standard are given below:

5. Assets namely moveable assets like bank accounts and various deposits taken over under the scheme of amalgamation under scheme of amalgamation effected in previous year are still held in the name of the erstwhile transferor company viz Mobile Petro chem. Pvt. Ltd., the company is in the process of getting it transferred in its name.

6. Excise duty Liability on Manufactured goods lying as on 31st March 2010 is provided at Rs. 33.72 lacs (Previous year Rs. 52.33 lacs). Customs duty on imported materials/ goods lying in customs bonded warehouse as on 31st March 2010 is provided at Rs. 721.19 lacs (Previous year Rs. 79.44 lacs)

7. The companys geographical operations at Ankleshwar, Marol & Daman consist of petroleum products. There are no other business segments related to the company and that the geographical locations are not subject to significantly differing risks and returns. In the opinion of the management;segmental reporting based on geographical locations is not required.

8. As per Accounting Standard 18, notified under the Companies (Accounting Standards) Rules 2006, the disclosures of transactions with the related parties as defined in the Accounting Standard are given below:

List of Related Parties: (Associates):

1. Anirudh Distributors Pvt. Ltd

2. Dunhill Development Pvt. Ltd

3. H.A. Constructions Pvt. Ltd

4. Ittefaq Ice & Cold Storage Co. Pvt. Ltd

5. Express Industries

6. Express Industries - AOP.

7. Iqbal Rayani Consultancy

8. Panama Petroleum Products

9. Asiatic Corporation

10. Iqbal Rayani Consultancy

11. Arif Iqbal Rayani Family Trust

12. Chemifine

13. Diamond Wax Agency

14. Monaco Petroleum Pvt. Ltd

15. S. R. Realities Pvt. Ltd.

16. Panama Builders & Developers Pvt. Ltd

17. Pickol Fibrotech

9. Leases

In accordance with the Accounting Standard on Leases (AS 19), notified under the Companies (Accounting Standards) Rules 2006 disclosures in respect of leases are made below:

a) The Company has taken a Factory/Office Premises on Operating Lease basis. Lease payments in respect of such leases recognized in Profit & Loss Account Rs. 20.00 Lacs (P.Y. - Rs. 10.28 Lacs).

c) The lease terms do not contain any exceptional / restrictive covenants other than prior approval of the lessee before renewal of lease.

d) There are no restrictions such as those concerning dividend and additional debt other than in some cases where prior approval of lessor is necessitated for further leasing.

e) Other lease arrangements, in respect of which payments are made by the Company, are cancelable.

10. Earnings Per Share computed as per AS-20 as follows: Net Profit attributable to equity shareholders: Rs. 2392 lacs. Weighted Average Number of Equity Shares Outstanding during the year: 58.40 lacs equity shares for Basic EPS and 58.40 lacs equity shares for Diluted EPS.

Earnings per share (Rs) Basic: Rs. 40.96, Diluted: Rs. 40.96

11. Details of dues to Micro, Small and Medium Enterprises as per MSMED Act, 2006

There are no outstanding to parties covered under the Micro, Small and Medium Enterprises as per MSMED Act, 2006. This information has been determined to the extent such parties have been identified on the basis of information available with the Company. This has been relied upon by the Auditors.

12. Details in respect of the products manufactured, Licensed and Installed Capacity, Opening Stock, Production and Purchases. Sales, Closing Stock and Raw Materials consumed are taken as certified by the Management and are as follows:

13. Inter Unit Transfer & Captive Consumption

Inter Unit transfers are valued, either at factory cost of the transferor unit or at sales price plus transport and other charges. Inter Unit transfers amounting to Rs.695.85 Lacs (Previous Year Rs. 1758.43 lacs) and Captive Consumption amounting to Rs.NIL (Previous Year Rs.NIL lacs) totaling to Rs.695.85 lacs (Previous year Rs. 1758.43 lacs) have been reduced from both purchases and sales during the year. The method adopted is similar to the method adopted in previous year.

14. As per the past practice consistently followed by the company, all indirect expenditure incurred at the Head Office are allocated to the Daman unit on the basis of the turnover ratio for the purpose of working out the profit of the said unit for availing deduction u/s 80 IB.

15. Current assets, loans & advances are approximately of the value stated, except otherwise stated, if realized in the ordinary course of business. The provision of all known liabilities, is adequate and not in excess of the amounts reasonably necessary. Balance in sundry debtors, loans and advances, deposits, current liabilities and unsecured loans are subject to confirmations.

16. Sundry Debtors include Rs.119.81 lacs (PY. Rs. 122.89 lacs) due for a period exceeding 2 years as on the balance sheet date. In the opinion of the management, the same are good and recoverable and hence the same has not been provided for.

17. Figures for the previous year have been regrouped/ recasted wherever necessary to make them comparable with the figures of the current year.

 
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