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Notes to Accounts of PSL Ltd.

Mar 31, 2015

NOTE "1" - SHARE CAPITAL

NOTE "1 A"

The Company has only one class of Equity Shares having a par value of Rs. 10 Per Share. Each Shareholder is eligible for one vote per share. In the event of liquidation, the Equity Shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding.

NOTE "2" TRADE PAYABLES

a. Trade Payables includes Rs. Nil (Previous Year Rs. Nil) Due to Micro and Small Enterprises registered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) Rs.314.86 Crores (Previous Year Rs.3456.58 Crores) due to other parties

b. No interest is paid/payable during the year to any enterprise registered under the MSME.

c. The above information has been determined to the extent such parties could be identified on the basis of the information available with the Company regarding the status of Suppliers under the MSME.

NOTE "3" - DERIVATIVE INSTRUMENTS

I. The Company has entered into the following derivative instruments.

a. Forward Exchange contracts (being a derivative instrument), which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

Forward Exchange Contracts entered into by the Company as on March 31,2015. (payable): USD NIL

b. Interest Rate Swaps to hedge against fluctuations in interest rate changes :

No of Contracts NIL

Notional Principal NIL

c. Currency Swaps (other than forward exchange contracts stated above) to hedge against fluctuations in changes in exchange rate.

No of Contracts NIL

Notional Principal NIL

NOTE "4" - RELATED PARTY DISCLOSURES

1. Relationships

a) Subsidiary Companies

PSL Corrosion Control Services Ltd. 100% Subsidiary Company

Pipe Line System Ltd., Mauritius 100% Subsidiary Company

PSL USA INC. , Delaware , USA 100% Subsidiary Company

PSL Gas Distribution Pvt.Ltd. 100% Subsidiary Company

PSL Infrastructure & Ports Pvt.Ltd. 100% Subsidiary Company

PSL FZE, Sharjah. 100% Subsidiary Company of Pipeline Systems Ltd., Mauritius

PSL North America LLC. JV Company of PSL USA INC., Delware, USA (80% holding)

(PSL North America LLC and PSL USA Inc., have filed insolvency petition under Chaper 11 under the US regulation. Currently under judicial process)

b) Associate BHI Ltd.

Broken Hills International Ltd.

Eurocoustic Products Ltd.

Punj International Pvt. Ltd.

Punj Investments Ltd.

Punj Corporation Private Limited

Rosoboronterra India Pvt.Ltd.

(Subsidiary of Punj Corporation Private Limited)

c) Key Management Personnel

Ashok Punj : Managing Director

M.M.Mathur : Director (till 31st May, 2014)

R. K . Bahri : Director

S. P.Bhatia : Director

C K Goel : Director

G. Gehani : Director & Co. Secretary (till 15 th July, 2014)

Shashi Ranjan : Company Secretary (w.e.f. 20th December, 2014)

Note: Related party Relationship is as identified by the Company and relied upon by the Auditors

NOTE 5 - LEASE

Operating lease payments are recognized as expenditure in the Profit and Loss account on a straight-line basis, which is representative of the time pattern of benefits received from the use of assets taken on lease. Lease rentals in respect of operating Lease are recognised as income over the lease period.

NOTE 6

The Accounting Standard (AS 17) relating to "Segment Reporting" has been complied with. As the gross income & Profit from the other segments are below the norms prescribed in AS-17 separate disclosures have not been made.

NOTE 7

(Rs. in lacs)

31st March 2015

I. Contingent liabilities

A. Counter Guarantees given by the Company for Bank Guarantees 9,566.12

B. Other Guarantees Given by the Company on behalf of

- Subsidiary Companies 44,198.00

- Others 4,575.68 48,773.68

C. Letter of Credit Outstanding (Not yet NIL committed)

D. Bills Discounting 369.43

E. Estimated amount of contracts remaining to be executed on capital account and not NIL provided for (net of advances)

31st March 2014

A. Counter Guarantees given by the Company for Bank Guarantees 35,896.04

B. Other Guarantees Given by the Company on behalf of

- Subsidiary Companies 101,256.79

- Others 4,575.68 105,832.47

C. Letter of Credit Outstanding (Not yet 124.74 committed)

D. Bills Discounting 535.32

E. Estimated amount of contracts remaining to be executed on capital account and not NIL provided for (net of advances)



II. Income Tax Assessment Completed upto AY 2012-13 (March'2012), Demand raised by the Department amounting to Rs 24.65 Lacs is contested before CIT (Appeal) Mumbai. Assessment for AY 2005-06 (March'05) u/s 263 r.w.s.143 (3) completed by the Department. Final Demand Rs.43.59 lacs is contested before CIT ( Appeal)

III. Gujarat Water Supply & Sewerage Board (GWSSB) , a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some Disputes, including a claim against the Company arising out of a routine contract awarded earlier to the Company the performance of which was hit by force major conditions. As Company has since challenged the jurisdiction of aforesaid tribunal, the matter is pending. Hence at this stage no provision has been made in the attached accounts towards any possible liability on this account.

IV. The Estate Office Kandla Port Trust under Public Premises (Evacuation of unauthoirsed) passed order on 27/3/14 for the evacuation of Kandla PCD-I premises because lease period was over. The Company is taking suitable legal action against above order. Since the lease amount is under dispute, the lease payment have not been made and not provided in accounts.

V. In the opinion of the Board the Current Assets are approximately of the value, if realised, in the ordinary course of the business. The Provision for Depreciation and for all known Liabilities are adequate and not in excess of the amount reasonably considered necessary. All the income accrued has been accounted for in the books.

VI. Sundry Debtors, Sundry Creditors and other advances are subject to confirmation.

NOTE "8"

In terms of the approval (LOA) of CDR cell interest on the bank loans of CDR member banks and non CDR member banks shall be funded for a period of 2 years i.e. from 1/1/2013 to 31/12/2014 as a fresh term loan namely FITL. Interest as per the approved rate based on the restructuring package was worked out, however not charged to interest account. Interest payable as per this calculation for the loan outstanding as on date amounting to Rs. 627.21 Crores. Also the Company has not provided regular interest on loan outstanding amounting to Rs. 88.58 Crores for the period from 01/01/2015 to 31/03/2015.

NOTE "9"

Current Year figures are for a period of 12 months and hence not comparable with the previous period figures which are for 6 months. The previous period figures have also been reclassified regrouped to conform to this period's classification

NOTE "10"

Significant accounting policies and practices adopted by the Company are disclosed in the statement annexed to these financial statements as Note No 1.


Mar 31, 2014

NOTE "1"

The Company has only one class of equity shares having a par value of Rs. 10/- per Share. Each Shareholder is eligible for one vote per share. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding.

All the bank loans are secured by first charge on the specific immovable property, entire moveable assets and the entire Current assets of the Company on paripassu basis except for a bank which has the first exclusive charge on the specific non core assets of the Company namely land at Pipava, Mahudi and Panipat.

The Company had filed the flash report on 6th March, 2013 before Corporate Restructuring (CDR) cell at Mumbai. The restructuring package was approved by CDR Cell, effective date being 24* August 2013. The outstanding loan balance is worked out on the basis of the approved package and it is accounted. The interest payable on this entire restructured loan as per the approved interest rate for this six months period is not accounted. This interest is being released by banks as FITL. FITL amounting to Rs. 16130.80 Lacs released by the banks for this six months period not accounted.

The Company has purchased 39.345 Acres of land from "Broken Hills International Private Limited for a consideration of Rs. 31,55,00,020/- (Rupees Thirty One Crores Fifty Five Lacs Twenty Only). The vendor has prior to execution of the sale deed, obtained the No Objection Certificate dated 20.03.2014 from ICICI Bank Limited (Acting as the Monitoring Institution in terms of the Master Restructuring Agreement dated 19.11.2013) under which ICICI Bank Limited has permitted the vendor to convey, transfer and assure the Scheduled land to the Purchasers subject to such conveyance transfer and assurance being subject to the mortgage subsisting in favour of the mortgage for the benefit of the lenders to the purchaser under the Master Restructuring Agreement dated 13.11.2013 and also on the condition that after the sale of the scheduled land in favour of the purchaser, the purchaser shall forthwith mortgage the scheduled land in favour of the security trustee for the benefit of the lenders to the purchaser under the Master Restructuring Agreement dated 13.11.2013 The vendor agrees that it shall, on receipt of necessary allotment advice from the purchaser for the aforesaid 1,21,30,770 equity shares, complete the sale by execution and registration of the sale deed in favour of the purchaser as result of which the entire scheduled land owned by the vendor shall get fully and absolutely conveyed into the purchaser and vendor shall be left with no right of any nature whatsoever in the scheduled land. The parties agree that the sale of the scheduled land shall be completed with such time line as directed by Monitoring Institution.

NOTE "2" - TRADE PAYABLES

a. Trade Payables includes Rs. Nil (Previous Year Rs. Nil) due to Micro and Small Enterprises registered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) Rs. 34658.31 Lacs (Previous Year Rs. 34607.88 Lacs) due to other parties.

b. No interest is paid/payable during the year to any enterprise registered under the MSME.

c. The above information has been determined to the extent such parties could be identified on the basis of the information available with the Company regarding the status of Suppliers under the MSME.

NOTE "3" - DERIVATIVE INSTRUMENTS

I. The Company has entered into the following derivative instruments

a. Forward Exchange contracts (being a derivative instrument), which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

Forward Exchange Contracts entered into by the Company as on March 31, 2014. (payable): USD NIL

NOTE "4" - LEASE

Operating lease payments are recognized as expenditure in the Profit and Loss account on a straight-line basis, which is representative of the time pattern of benefits received from the use of assets taken on lease. Lease rentals in respect of operating lease are recognised as income over the lease period.

NOTE "5"

The Accounting Standard (AS 17) relating to "Segment Reporting" has been complied with. As the Gross Income & Profit from the other segments are below the norms prescribed in AS-17 separate disclosures have not been made.

NOTE "6"

(Rs. in Lacs) Particulars For the Period Ended 31st March, 2014 (6 Months)

I. Contingent Liabilities

A. Counter Guarantees given by the Company for Bank Guarantees 35,896.04

B. Other Guarantees Given by the Company on behalf of Subsidiary Company [Includes Corporate Guarantee as Security for a Standby Letter of Credit (SBLC) 101,256.79 given by a bank in USA amounting to Rs. 31.20 Lacs (equivalent to USD 78 mn) towards security for Tax Exempt Variable Rate Demand Revenue Bonds - Series 2007A and Taxable Variable Rate Demand Revenue Bonds- Series 2007 B issued by Mississippi Business Finance Corporation USA on behalf of Company''s wholly owned subsidiary]

- Others 4,575.68 105,832.47

C. Letter of Credit Outstanding (Not yet committed) 124.74

D. Bills Discounting 535.32

E. Estimated amount of contracts remaining to be executed on Capital Account and NIL

E. not provided for (Net of advances) NIL

(Rs. in Lacs) Particulars For the Period Ended 30th September, 2013 (18 months)

I. Contingent Liabilities

A. Counter Guarantees given by the Company for Bank Guarantees 63,710.40

B. Other Guarantees Given by the Company on behalf of Subsidiary Company [Includes Corporate Guarantee as Security for a Standby Letter of Credit (SBLC) 106,452.06 given by a bank in USA amounting to Rs. 31.20 Lacs (equivalent to USD 78 mn) towards security for Tax Exempt Variable Rate Demand Revenue Bonds - Series 2007A and Taxable Variable Rate Demand Revenue Bonds- Series 2007 B issued by Mississippi Business Finance Corporation USA on behalf of Company''s wholly owned subsidiary]

- Others 4,575.68 111,027.74

C. Letter of Credit Outstanding (Not yet committed) 30.06

D. Bills Discounting 493.84

E. Estimated amount of contracts remaining to be executed on Capital Account and NIL

E. not provided for (Net of advances) NIL

II. Income Tax Assessment Completed upto AY 2011-12 (March''2011), Demand raised by the Department amounting to Rs. 135.82 Lacs is contested before CIT (Appeal) Mumbai. Assessment for AY 2005-06 (March''05) u/s 263 r.w.s.143 (3) completed by the Department. Final Demand Rs. 43.59 lacs is contested before CIT ( Appeal)

III. Gujarat Water Supply & Sewerage Board (GWSSB), a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some Disputes, including a claim against the Company arising out of a routine contract awarded earlier to the Company the performance of which was hit by force major conditions. As Company has since challenged the jurisdiction of aforesaid tribunal, the matter is pending. Hence at this stage no provision has been made in the attached accounts towards any possible liability on this account.

IV. The Estate Office Kandla Port Trust under Public Premises (Evacuation of unauthoirsed) passed order on 27/3/14 for the evacuation of Kandla PCD-I premises because lease period was over. The Company is taking suitable legal action against above order. Since the lease amount is under dispute, the lease payment have not been made and not provided in accounts.

V. In the opinion of the Board the Current Assets are approximately of the value, if realised, in the ordinary course of the business. The Provision for Depreciation and for all known Liabilities are adequate and not in excess of the amount reasonably considered necessary . All the income accrued has been accounted for in the books.

VI Departmental Appeal :The Company is defending an appeal for a duty amount of Rs. 30900 Lacs filed by Commissioner of Customs Kandla before CESAT Ahmedabad, which was earlier won by the Company. As on date, no demand is payable The matter is subjudice.

VII Sundry Debtors, Sundry Creditors and other advances are subject to confirmation.

NOTE "7"

In terms of the approval (LOA) of CDR cell interest on the bank loans of CDR member banks and non CDR member banks shall be funded for a period of two years i.e. from 1st January, 2013 to 31st December, 2014 as a fresh term loan namely FITL. Interest as per the approved rate.

NOTE "8"

Current Period figures are for a period of 6 months and hence not comparable with the pervious period figures which are for eighteen months. The previous period figures have also been reclassified regrouped to confirm to this period''s classification.


Sep 30, 2013

NOTE "1" - TRADE PAYABLES

a. Trade Payables includes '' Nil (Previous Year '' Nil) Due to Micro and Small Enterprises Registered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii) ''34607.88 lacs (Previous Year ''113,683.70 Lacs) due to other parties.

b. No interest is paid/payable during the year to any enterprise registered under the MSME.

c. The above information has been determined to the extent such parties could be identified on the basis of the information available with the Company regarding the status of Suppliers under the MSME.

NOTE "2" - DERIVATIVE INSTRUMENTS

I. The Company has entered into the following Derivative Instruments.

a. Forward Exchange Contracts (being a Derivative Instrument), which are not intended for Trading or Speculative purposes, but for Hedge Purposes, to establish the amount of Reporting Currency required or available at the settlement date of certain Payables and Receivables.

Forward Exchange Contracts entered into by the Company as on September 30, 2013.(payable): USD NIL

b. Interest Rate Swaps to hedge against Fluctuations in Interest Rate Changes :

No of Contracts NIL

Notional Principal NIL

c. Currency Swaps (other than Forward Exchange Contracts stated above) to hedge against fluctuations in changes in exchange rate.

No of Contracts NIL

Notional Principal NIL

(Rs.in Lacs)

Particulars (September 30, 20131 March 31, 2012 (18 Months) (12 Months)

I. Contingent Liabilities

A. Counter Guarantees given by the Company for Bank Guarantees 63,710.40 51,165.06

B. Other Guarantees Given by the Company on behalf of Subsidiary Company 106,452.06 185,774.96

[Includes Corporate Guarantee as Security for a Standby Letter of Credit (SBLC) given by a Bank in USA amounting to '' 31.20 Lacs (equivalent to USD 78 mn) towards Security for Tax Exempt Variable Rate Demand Revenue Bonds - Series 2007A and Taxable Variable Rate Demand Revenue Bonds- Series 2007 B issued by Mississippi Business Finance Corporation USA on behalf of Company''s Wholly Owned Subsidiary]

- Others 4,575.68 286.07

111,027.74 186,061.03

C. Letter of Credit Outstanding (Not yet committed) 30.06 15,719.50

D. Bills Discounting 493.84 12,010.90

E Estimated amount of contracts remaining to be executed on Capital Account 3 0 and not provided for (Net of advances)

II. Income Tax Assessment Completed upto AY 2010-11 (March''2010), Demand raised by the Department amounting to Rs 165.98 Lacs is contested before CIT (Appeal) Mumbai. Assessment for AY 2005-06 (March''05) u/s 263 r.w.s.143 (3) completed by the Department. Final Demand ''43.59 lacs is contested before CIT ( Appeal)

III. Gujarat Water Supply & Sewerage Board (GWSSB) , a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some Disputes, including a claim against the Company arising out of a Routine Contract awarded earlier to the Company the performance of which was hit by Force Major conditions. As Company has since challenged the Jurisdiction of aforesaid Tribunal, the matter is pending. Hence at this stage no provision has been made in the attached accounts towards any possible Liability on this account.

IV. The Renewal of Leave & License admeasuring to 329216 Sqm (Area) of Kandla Port Trust is under progress before the competent authority.

V. In the opinion of the Board the Current Assets are approximately of the value, if realised, in the ordinary course of the Business.

The Provision for Depreciation and for all known Liabilities are adequate and not in excess of the amount reasonably considered necessary . All the Income Accrued has been accounted for in the books.

VI Departmental Appeal :The Company is defending an appeal for a duty amount of '' 30900 Lacs filed by Commissioner of Customs Kandla before CESAT Ahmedabad, which was earlier won by the Company. As on date, no demand is payable The matter is subjudice.

VII Sundry Debtors, Sundry Creditors and other advances are subject to confirmation.

NOTE "3"

In terms of the approval (LOA) of CDR cell interest on the bank loans of CDR member banks and non CDR member banks shall be funded for a period of 2 years i.e. from 1/1/2013 to 31/12/2014 as a fresh term loan namely FITL. Interest @ 10.25% based on restructuring package was worked out and charged to interest account on the Loan Outstanding of non CDR member banks as on 1/1/2013 for the period of 9 months ending September,2013. Excess interest reversed to the Interest Account. Interest payable as above for the loan outstanding of CDR member bank was not provided which is amounting to '' 163.36 Crores.

NOTE "4"

Current Period Figures are for a period of 18 Months and hence not comparable with the pervious year figures which are for 12 months. The previous year figures have also been reclassified regrouped to confirm to this period''s classification


Mar 31, 2012

The Company has only one class of Equity Shares having a par value of Rs. 10/- Per Share. Each Shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of Shareholders, except in case of Interim Dividend. In the event of liquidation, the Equity Shareholders are eligible to receive the remaining Assets of the Company, after distribution of all preferential amounts, in proportion of their Shareholding.

Nature of Security and Terms of Repayment for Long Term Secured Borrowing

1. Foreign Currency Term Loan (ECB) amounting to USD 50 mn (March 31, 2011 USD 50 mn) is Secured against First Charge on parri passu basis on some of the Immovable & Moveable Assets of the Company.

Terms of Repayment : USD 20 mn on 14th December 2012 and USD 30 mn on 16th January 2015.

2. Term Loan amounting to Rs. Nil (March 31,2011 Rs. 3,745.04 is secured against First Charge on pari passu basis on some of the Immovable & Moveable Assets of the Company).

3. Term Loan amounting to Rs. 14,000 Lacs (March 31, 2011 Rs. 18,000 Lacs) is secured against First Charge on pari passu basis on some of the Immovable & Moveable Assets of the Company.

Terms of Repayment : Two Quarterly Installments of Rs. 1000 Lacs each and Eight quarterly Installment of Rs. 1500 Lacs each Last Installment 30th September 2014.

4. Term Loan amounting to Rs. 8,888 Lacs (March 31, 2011 Rs. 10,000 Lacs) is secured against Second charge on pari passu basis over the moveable Assets of the Company.

Terms of Repayment : Monthly installment of Rs. 555.55 Lacs. Last Installment Date 29th July 2013.

5. Term Loan amounting to Rs. 5,003.63 Lacs (March 31, 2011 Rs. 10,000 Lacs) is secured against Subsequent Charge on Fixed Assets and Current Assets of the Company.

Terms of Repayment: Quarterly installment of Rs.1,250 Lacs. Last Installment Date 31st March 2013.

6. Vehicle Loans is Secured by Hypothecation of Specific Vehicles

NOTE "1" - TRADE PAYABLES

a. Trade Payables includes Rs.. Nil (Previous Year Rs.. Nil) Due to Micro and Small Enterprises Registered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSME); and (ii)Rs.113683.70 lacs (Previous Year Rs.152,272.46 Lacs) due to other Parties.

b. No interest is paid/payable during the year to any Enterprise Registered under the MSME.

c. The above information has been determined to the extent such parties could be identified on the basis of the information available with the Company regarding the status of Suppliers under the MSME.

The Company has entered into the following Derivative Instruments:

a. Forward Exchange contracts (being a derivative instrument), which are not intended for trading or speculative purposes, but for hedge purposes, to establish the amount of reporting currency required or available at the settlement date of certain payables and receivables.

Forward Exchange Contracts entered into by the Company as on March 31, 2012.(payable): NIL

b. Interest Rate Swaps to hedge against fluctuations in interest rate changes :

No of Contracts N I L

Notional Principal N I L

c. Currency Swaps (other than forward exchange contracts stated above) to hedge against fluctuations in changes in exchange rate.

No of Contracts One

NOTE - LEASE

Operating lease payments are recognized as expenditure in the Profit and Loss Account on a Straight-Line Basis, which is representative of the time pattern of benefits received from the use of Assets taken on lease. Lease rentals in respect of operating lease are recognized as Income over the Lease Period.

NOTE "2"

The Accounting Standard (AS 17) relating to "Segment Reporting" has been complied with. As the Gross Income & Profit from the other segments are below the norms prescribed in AS-17 separate disclosures have not been made.

II. Income Tax Assessment Completed up to AY 2009-10 (March' 2009), Demand raised by the Department amounting to Rs. 257.35 Lacs is contested before CIT Appeal Mumbai. The Department has raised a demand of Rs. 723.90 Lacs for AY 2005-2006 u/s 143 (3) of the Income Tax Act read with u/s 263 of the Act. ITAT has directed the Assessing Officer to redo the Assessment, which is pending. Amount outstanding as on date Rs. 503.90 Lacs.

III. Gujarat Water Supply & Sewerage Board (GWSSB), a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some Disputes, including a claim against the Company arising out of a routine contract awarded earlier to the Company the performance of which was hit by force majeure conditions. As Company has since challenged the jurisdiction of aforesaid tribunal, the matter is pending. Hence at this stage no provision has been made in the attached accounts towards any possible liability on this account.

IV. The renewal of leave & license admeasuring to 329216 Sqm (Area) of Kandla Port Trust is under progress before the competent authority.

V. In the opinion of the Board the Current Assets are approximately of the value, if realized, in the ordinary course of the business.

The Provision for Depreciation and for all known Liabilities are adequate and not in excess of the amount reasonably considered necessary. All the income accrued has been accounted for in the books.

VI Departmental Appeal : The Company is defending an appeal for a duty amount of Rs. 30900 Lacs filed by Commissioner of Customs Kandla before CESAT Ahmadabad, which was earlier won by the Company. As on date, no demand is payable, the matter is subjudice.

VII Sundry Debtors, Sundry Creditors and other advances are subject to confirmation.

NOTE "3"

The Financial Statements for the year ended 31st March 2011 had been prepared as per the then applicable pre-revised Schedule VI to the Companies Act 1956 Consequent to the notification under the Companies Act 1956 the Financial Statement for the year ended 31st March 2012 are prepared under revised Schedule VI. Accordingly, the previous year figures have also been re-classified to confirm to this year's classification.


Mar 31, 2011

(Rs. in Lacs)

2010-11 2009-10

a) Counter Guarantees Given by the Company for Bank Guarantees 59,961.68 88,423.60

b) Other Guarantees Given by the Company on behalf of

- Subsidiary Company 119,885.25 76,963.70

[Includes Corporate Guarantee as Security for a Standby Letter of Credit (SBLC) given by a bank in USA amounting to Rs. 31,200 Lacs (equivalent to USD 78 mn) towards security for Tax Exempt Variable Rate Demand Revenue Bonds - Series 2007A and Taxable Variable Rate Demand Revenue Bonds - Series 2007B issued by Mississippi Business Finance Corporation USA on behalf of company's wholly owned subsidiary]

- Others 1,987.84 1,956.03

121,873.09 78,919.73

c) Letter of Credit Outstandings (Not yet Commited) 65,767.35 5,556.14

d) Bills Discounting 8092.28 14808.76

e) Estimated amount of contracts remaining to be executed 3000.00 3000.00 on capital account and not provided for (net of advances)

f) (i) Income Tax Assesments Completed upto AY 2008-09 (March 2008), Demand raised by the Department amounting to Rs. 74.91 lacs is contested before CIT Appeal Mumbai.

(ii) Appeals for the Assessment Year 2007-08 and 2006-07 is pending before ITAT, Mumbai

(iii) The Department raised the demand of Rs. 700 Lacs for AY 2005-06 u/s 143(3) of the Act read with u/s 263 of the Act. Company has preferred an appeal before ITAT challenging the commissioner directive u/s 263 which is pending before the ITAT Mumbai.

g) Gujarat Water Supply & Sewerage Board (GWSSB), a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some diputes, including a claim against the Company arising out of a routine contract awarded earlier to the Company, the performance of which was hit by force majeure conditions. As company has since challenged the jurisdiction of aforesaid tribunal, the matter is pending. Hence at this stage no provision has been made in the attached accounts towards any possible liability on this account.

h) The renewal of leave & license admeasuring to 329216 Sqm (Area) of Kandla Port Trust is under progress before the competent authority.

x. Impact of Issue of Foreign Currency Convertible Bonds (FCCB'S)

In September 2005 the Company had issued Zero Coupon Foreign Currency Convertible Bonds (FCCB'S) worth US $40 Million. As per terms of issue, these Bonds which were listed on Singapore Stock Exchange were convertible into fully- paid and pari passu ranking equity shares of Rs. 10/- each at premium of Rs. 224.54 on or any day prior to 8th August, 2010.

During the year, these bonds worth USD 2.5 Million being the pending face value of the bonds along with the eligible premium for five year were redeemed completely on 3rd September, 2010. Hence pending FCCB as on 31st March 2011 - "NIL".

2. Loans & Advances Includes Amount Receivable from Companies under Same Management Rs. 780.24 Lacs (Previous Year Rs. 605.25 Lacs).

3. The Company is in the process of identifying the Suppliers who are Small Scale Industries & Undertaking. The amount due to them has not been quantified during the year.

4. In the opinion of the Board the Current Assets are approximately of the value, if realised, in the ordinary course of the business. The Provision for Depreciation and for all known Liabilities are adequate and not in excess of the amount reasonably considered necessary. All the Income Accrued has been accounted for in the Books.

5. Schedules A to Q forming an integral part of the Balance Sheet and Profit and Loss Account are duly authenticated.

6. The Previous Year figures have been Re-grouped/Rearranged wherever necessary to confirm the Current Year Classification.


Mar 31, 2010

(Rs. in lacs)

2009-10 2008-09

a) Counter Guarantees given by the company for Bank Guarantees 88,423.60 111,107.98 (Includes Standby Letter of Credit (SBLC) given by

a Bank in India amounting to Rs. 31,200 Lacs (equivalent to USD 78 mio) as a security for Tax Exempt Variable Rate Demand Revenue Bonds - Series 2000A and Taxable Variable Rate Demand Revenue Bonds - Series 2000B issued by Mississippi Business Finance Corporation USA on behalf of companys wholly owned subsidiary.

b) Other Guarantees given by the Company 78,919.72 19,706.93 on behalf of Associate & Subsidiary Company

c) Letter of Credit Outstandings (Materials not received) 5,556.14 1,457.68

d) Bills Discounting 14,808.76 NIL

e) Estimated amount of contracts remaining to be executed 3,000.00 3,000.00 on capital account and not provided for (net of advances)



f) Income Tax Assessments completed upto AY 2007-08 (March 2007). Demand raised by the Department amounting to Rs.497 Lacs for AY 2007-2008 and Rs. 154 lacs for AY 2006-07 are contested before CIT (Appeals) Mumbai.

The Department raised the demand of Rs.700 Lacs for AY 2005-06 U/s 143(3) of the Act read with U/s 263 of the Act. Company has preferred an appeal before ITAT challenging the commissioners directive U/s 263 which is pending before the ITAT Mumbai.

g) Gujarat Water Supply & Sewerage Board (GWSSB), a Government of Gujarat Undertaking and a regular customer of the Company has made a reference to "Gujarat Public Works Contracts Disputes Arbitration Tribunal" for settlement of some diputes, including a claim against the Company arising out of a routine contract awarded earlier to the

Company, the performance of which was hit by force majeure conditions. As Company has since challenged the jurisidiction of aforesaid tribunal, the matter is pending.

Hence at this stage no provision has been made in the attached accounts towards any possible liability on this account.

h) The renewal of leave & licence admeasuring to 329216 Sqm (Area) of Kandla Port Trust is under progress before the competent authority.

x. Impact of issue of Foreign Currency Convertible Bonds (FCCBs)

a) In September 2005 the Company had issued Zero Coupon Foreign Currency Convertible Bonds (FCCBs) worth US $40 Miillion. As per terms of issue , these Bonds are convertible into fully -paid and pari passu ranking equity shares of Rs.10 each at premium of Rs. 224.54 (subject to terms and conditions of the said FCCB issue) on or any day prior to 8th August 2010. The said Bonds, unless converted or redeemed earlier will be redeemed at 143.64 percent of their principal amount on 7th September, 2010 being the prefixed maturity date.

b) Such Bonds worth US$ 3,750,000 have already been converted into 8661511 equity Shares till date.

c) The bonds are listed on the Singapore Stock Exchange.

d) Although, the Board of Directors had accorded its in principal approval to buyback the Zero Coupon Convertible Bonds due for redemption in September 2010, amounting to USD 2.50 Million the company did not finally pay these bonds due to changed market conditions.

2. The Company is in the process of identifying the suppliers who are Small Scale Industries & Undertakings. The amount due to them has not been quantified during the year.

3. In the opinion of the Board, the Current Assets are approximately of the value, if realised, in the ordinary course of the business. The provision for Depreciation and for all known liabilities are adequate and not in excess of the amount reasonably considered necessary. All the income accrued has been accounted for in the books.

4. Schedules A to Q forming an integral part of the Balance Sheet and Profit and Loss Account are duly authenticated.

5. The previous year figures have been regrouped/rearranged wherever necessary to conform the current year classification.

 
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