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Notes to Accounts of Ramkrishna Forgings Ltd.

Mar 31, 2015

1 The Company, as on 31st March, 2014, had 17,80,000 outstanding warrants which were issued to M/s. Eastern Credit Capital (P) Limited (Formally Eastern Credit Capital Limited), Promoter group, on a preferential basis at a price of Rs. 130/- per warrant. On 18th July 2014 out of above 13,70,500 number of warrants has been converted into equity shares of Rs. 10/- each at a premium of Rs. 120/- per share and balance 4,09,500 number of warrants has been forfeited.

2 The Company in its Board Meeting held on 14th July, 2014 has allotted 12,00,000 warrants to M/s. Riddhi Portfolio (P) Ltd, Promoter Group, on a preferential basis at a price of Rs. 150/- per warrant. The warrants can be converted into 12,00,000 equity shares of Rs. 10/- each at a premium of Rs. 140/- per share within a period of 18 months from the date of allotment i.e 14th July, 2014.

3 Right, Preference and restrictions attached to Shares :

The Company has one class of equity shares having a par value of Rs. 10/- per share. Each share holder is eligible for one vote per share held. The dividend proposed by the Board of Director is subject to the approval of the shareholderes in the ensuing Annual General meeting, 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 amount, in proportion to their shareholding.

For the year ended 31st March, 2015, the Board of Directors of the Company has recommended dividend of Rs. 2/- per share (Previous year Rs. 1/- per share) to equity shareholders aggregating to Rs. 549.40 Lacs (Previous year Rs. 260.99 Lacs). The total payout together with the Corporate Dividend Distribution Tax of Rs. 109.85 Lacs (Previous year Rs. 44.36 Lacs), will be Rs. 659.25 Lacs (Previous year Rs. 305.35 Lacs).

4 Security :

(i) Term loans (except those which are having exclusive charge) are secured by way of first pari-passu charge over all immovable and moveable fixed assets, both present and future, of the Company excluding 125 MN Front Axles, Crankshafts, and Stub Axle (four at a time) Forging Press Line and those assets for which there is an exclusive charge of other bankers and subject to charges of the Company''s bankers created / to be created in their favour for working capital loans. It is further secured by the second charge on the current assets of the Company, both present and future, excluding hundies of Tata Motors discounted by State Bank of India.

(ii) Term Loan of Rs. 1,600 Lacs from Development Credit Bank is secured by the subservient charge on the current assets of the Company and collateral security of land alongwith building at 72 Shakespeare Sarani. Kolkata - 700 017.

(iii) Term Loan of Euro. 154.46 Lacs from Landesbank Baden - Wurttemberg( LBBW) is secured by the first charge on the 125 MN Front Axles, Crankshafts, and Stub Axle (four at a time) Forging Press Line imported from SMS,Gmbh.

(iv) Term loan of Rs. 952 Lacs from IDBI Bank Limited is secured by the specific charge on the assets financed by them .

5 Interest Rate & Repayment of Loan

Term Loan from bank / financial institutions carries interest EUR libor 52 bps to 13% p.a. Loan are repayble in monthly / quarterly / half yearly instalments.

6 Notes

1. Exceptional Items during the year include Rs. 291.97 Lacs towards surrender of the Keyman Insurance Policy and Rs. 454.25 Lacs towards profit on sale of one of the office premises of the Company.

2. The Company has paid a managerial remuneration in excess of the limitis as laid down in the section 309(3) read with Schedule XIII of the Companies Act, 1956 of Rs. 65.62 Lacs and Rs. 106.38 Lacs respectively during the financial year 2012-13 and 2013-14 to Mr. Mahabir Prasad Jalan, Chairman. Since the payament of the remuneration in excess of the limits requires approval of the Central Government the company had made an application to the Central Government. The Central Government has rejected the application made for Mr. Mahabir Prasad Jalan, Chairman and the company has made a representation for the same. The outcome of the same is awaited.

3. The Company has received a show-cause notice from the Directorate of Revenue Intelligence (DRI) and also from the Director General of Foreign Trade (DGFT) with regard to simultanceous issuance of EPCG license and Status Holder Incentive Scrip (SHIS) in the year 2013-2014. It is relevant to submit that the facts and issues involved in the above mentioned show-cause notices issued by DRI and DGFT are identical. The Company has made a detailed representation to the show-cause notice issued by DGFT and after considering the representation made by the Company, DGFT has discharges the said show-cause notice and has closed the proceeding in favour of the Company. Further, with regard to the DRI notice, the company has made a representation to Central Board of Excise and Customs (CBEC). The Company has also filed a writ petition before the Delhi High Court (Court). DGFT has also submitted to the Court that they are in agreement with the contentions raised by the Company. The Court has directed CBEC to file the affidavit. The outcome of the case is awaited.

7 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED)

As at 31st As at 31st March, 2015 March, 2014

A) Contingent Liabilities

a) Claims against the Company not acknowledged as debt

(i) Electricity charges demand of 45.24 45.24 Jharkhand State Electricity Board. (Pending before High Court, Jharkhand)

(ii) Demand for Sales Tax for the FY 2003-04 (Appeal pending before 0.22 - the The Joint Commissioner of Sales Tax (Appeal), Jamshedpur)

(iii) Demand for Sales Tax for 1.90 - the FY 2004-05 (Appeal pending before the The Joint Commissioner of Sales Tax (Appeal), Jamshedpur)

(iv) Demand for Sales Tax for 9.16 - the FY 2005-06 (Appeal pending before the The Joint Commissioner of Sales Tax (Appeal), Jamshedpur)

(v) Demand for Income Tax for 13.01 8.03 the AY 2007-08 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(vi) Demand for Income Tax for - 3.96 the AY 2008-09 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(vii) Demand for Service Tax for the 35.98 35.98 FY 2004-05, 2005-06, 2006-07 (upto July 2006) (Appeal pending before the Excise & Service Tax Appellate Tribunal, Kolkata) (Deposit Rs. 2.00 Lacs)

(viii)Demand for Service Tax for 15.34 - the FY 2007-08 to 2011-12 (Appeal pending before the Additional Commissioner Service Tax, Kolkata)

(ix) Demand for Service Tax 9.74 - for the FY 2009-10 (Appeal pending before the Commissioner(Appeals-1), Kolkata) (Deposit Rs. 0.37 Lacs)

(x) Demand for Central Excixe for 17.72 - the FY 2010-11 & FY 2011-12 (Appeal pending before the Joint Commissioner of Central Excise, Kolkata II)

b) Bank Guarantee 567.63 567.63

c) Custom duty on Capital goods 5,448.74 5,169.27 imported under EPCG Scheme / Advance Licence, against which export obligation of Rs. 36,589.31 Lacs (Previous year Rs. 37,294.89 Lacs) is to be fulfiled

d) Corporate guarantee given to 1,400.00 1,000.00 State Bank of India, Commercial Branch, Jamshedpur, on behalf of Globe Forex & Travels Ltd., wholly owned Subsidiary of the Company.

e) Corporate guarantee given to ICICI 500 - Bank Ltd. R. N. Mukherjee Branch, Kolkata on behalf of Globe Forex & Travels Ltd., wholly owned Subsidiary of the Company.

B) Commitments

a) Estimated amount of contracts 8,838.63 17,474.91 remaining to be executed on capital account and not provided for

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation, upon superannuation or on exist otherwise and is provided for on the basis of actuarial valuation made at the year end using projected unit credit method.

ii) Leave salary - compensated absence: - The Company also extends defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

iii) In respect of Defined contribution Scheme : The Company contributes 12% of salary for all eligible employees towards Provident Fund managed by the Central Government. Total expenses recognized towards Employer''s contribution to Provident Fund Rs. 236.88 Lacs (Previous year Rs. 133.02 Lacs).

8 RELATED PARTIES (DISCLOSED AS PER ACCOUNTING STANDARD (AS) - 18)

(a) Name of related parties and nature of relationship where control exists are as under:

(i) Enterprises over which Key (i) M/s. Riddhi Portfolio Management Personnel and (P) Ltd. their relatives are able to exercise (ii) M/s. Eastern Credit significant influence. Capital (P) Ltd.

(iii) M/s. Ramkrishna Rail & Infrastructure Pvt. Ltd.

(iv) M/s. Clifftop Infrabuild Pvt. Ltd.

(v) M/s. Norteast Infra Properties Pvt. Ltd."

(ii) Subsidiary of the Company M/s. Globe Forex & Travels Ltd

(iii) ESOP Trust of the Company M/s Ramkrishna Forgings Employee Welfare Trust (iv) Key Management Personnel

Mahabir Prasad Jalan Chairman cum Whole Time Director

Naresh Jalan Managing Director

Pawan Kumar Kedia Finance Director

(v) Relative of Key Management Personnel Rashmi Jalan Wife of Mr. Naresh Jalan

9 Exchange Rate Difference

Foreign currency exchange difference Gain of Rs. 255.04 Lacs (Previous year Loss of Rs. 49.79 Lacs) on long term borrowing for acquisition of Fixed Assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R. 913 (E) dt. 29.12.2011) issued by Ministry of Corporate Affairs.

10 Operating Lease

The Company''s significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Statement of Profit and Loss.

11 The Company has recognised a capital subsidy (in the form of sales tax refund) of Rs. 137.94 Lacs (Previous year of Rs. 516.90 Lacs) under Jharkhand Industrial Policy, 2001 which has been credited to Capital Reserve.

12 Figures for the previous year have been regrouped and reclassified to conform to the classification of the current period, where necessary.


Mar 31, 2014

1. The Company has paid a managerial remuneration ofRs. 338.29 Lacs and Rs. 354.48 Lacs during the financial year 2012-13 and 2013-14.Out of which an amount of Rs. 120.48 Lacs andRs. 191.72 Lacs is in excess of the limits as laid down in the section 309(3) read with schedule XIII of the Companies Act, 1956 for the financial year 2012-13 and 2013-14 respectively. Since the payment of the remuneration in excess of the limits requires approval of the Central Government the Company has made an application to the Central Government and the approval is awaited.

2. During the year the Company has acquired 27.18% shares of M/s. Globe Forex & Travels Ltd and it has thus become a wholly owned subsdiary of the Company w.e.f 8th April, 2013.

3. Contingent Liabilities and Commitments (to the extent not provided)

As at

31/03/2014 31/03/2013

A. Contingent Liabilities

(a) Claims against the Company not acknowledged as debt

(i) Electricity charges demand of Jharkhand State Electricity Board. 45.24 45.24 (Appeal pending before High Court, Jharkhand)

(ii)Demand from Jharkhand State Electricity Board on account of disconnection - 2.29 of line at Plant I (Appeal pending before Dy. Commissioner, Sariekela)

(iii)Demand for Income Tax for the AY 2007-08 8.03 8.03 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(iv) Demand for Income Tax for the AY 2008-09 3.96 3.96 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(v) Demand for Service Tax for the FY 2004-05, 2005-06, 2006-07 (upto July 35.98 35.98 2006) (Appeal pending before the Excise & Service Tax Appellate Tribunal, Kolkata)

(vi) Demand for Sales Tax for the FY 2009-10 - 7.36 (Appeal pending before the The Joint Commissioner of Sales Tax, Kolkata)

(vii)Demand for sales Tax for Nov, 2012 for wrong availment of Input tax credit - 7.41

(Appeal pending before Joint Commissioner of Commercial Taxes (Appeals),Jamshedpur)

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation upon superannuation or on exist otherwise and is provided for on the basis of actuarial valuation made at the year end using projected unit method

(ii) Leave salary - Compensated absents : The Company also extends defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

(iii) In respect of Defined contribution Scheme : The Company contributes 12% of salary for all eligible employees towards Provident Fund managed by the Central Government. Total expenses recognized towards Employer''s contribution to Provident Fund Rs. 133.02 Lacs (Previous year Rs. 122.36 Lacs).

4. Exchange Rate Difference

Foreign currency exchange difference Loss ofRs. 49.79 Lacs (Previous year Loss ofRs. 56.85 Lacs) on long term borrowing for acquisition of Fixed Assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R.913(E) dt. 29.12.2011) issued by Ministry of Corporate Affairs.

5. Operating Lease

The Company''s significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Statement of Profit & Loss.

a. Employee stock option scheme

(i) The shareholders of the Company had approved the ESOP 2009 to grant 15,00,000 stock options convertible into 15,00,000 equity shares of Rs. 10/- each to its permanent employees including director of the Company whether wholetime or otherwise in one or more tranches and on such terms and conditions as may be fixed or determined by its Board of Directors. The above scheme is administered through an ESOP trust namely Ramkrishna Forging Employee Welfare Trust.

(ii) The Compnay in its Board Meeting on 14th November 2013 has aligned its ESOP scheme with the new SEBI Guidelines and has decided to grant 7,96,419 numbers of options to its employees in future based on recommendation of Remuneration & Compensation committee.

(iii) The Compensation Committee in its meeting held on 12th September,2009 has granted 4,68,159 numbers options to be converted into equivalent number of equity shares to the employees of the Company. The options under the scheme has been vested and all the employees has converted these options into shares as per the eligible criteria of the scheme and there no pending options to be converted into shares as on the reporting date. With the vesting and exercise of all the option the scheme has been closed by the Company.

c. The employee share based payment plans have been accounted based on the intrinsic value method and accordingly Rs. 8.44 Lacs (Previous year Rs. 30.20 Lacs) has been charged as employee compensation cost. Had the fair value method of accounting been used, the employee compensation cost would have been Rs. 8.78 Lacs (Previous year Rs. 35.80 Lacs).

e. The loans advanced to the Trust for purchase of shares from the market as at March 31, 2014, isRs. 968.19 Lacs (Previous year Rs. 1,200.15 Lacs). The repayment of the loan by the trust is dependent on the exercise of options by the employees and/or the market price of the underlying equity shares of the unexercised options at the end of the exercise period.

6. The Company has recognised a capital subsidy (in the form of sales tax refund) of Rs. 516.90 Lacs under Jharkhand Industrial Policy, 2001 which has been credited to Capital Reserve.

7. Information related to Micro, Small and Medium Enterprises Development Act, 2006 (the Act) is disclosed hereunder. The information given below has been determined to the extent such parties have been identified on the basis of information available with the Company:

8. Figures for the previous year have been regrouped and reclassified to conform to the classification of the current period, where necessary.


Mar 31, 2013

1. The Company had opted, in FY 2011-12, to apply para 46A of Accounting Standard AS-11 with effect from 01.04.2011 in accordance with notification dated 29.12.2011 issued by the Ministry of Corporate Affairs(MCA). Subsequently vide notification No. 25/2012 dated 09.08.2012 MCA has clarified that para 6 of AS-11 and para 4(e) of AS-16 shall not apply to Company which is applying 46A of AS-11. Accordingly foreign exchange rate difference on long term foreign currency borrowing to the extent regarded as adjustment to interest cost which was hitherto charged to statement of Profit and Loss has been adjusted to carrying cost of the related assets with effect from 01.04.2011. The change has resulted in increase in Profit before Tax for the year rS. 63.52 lakhs.

2. The Company has paid managerial remuneration of rS. 338.29 Lakhs during the financial year 2012-13 out of which rS. 120.48 lakhs is in excess of the limits as laid down in the section 309(3) read with schedule XIII of the Companies Act 1956. Since the payment of the remuneration in excess of the limits requires approval of the Central Government the company has made an application to the Central Government and the approval is awaited.

3. During the year the Company has acquired 72.82% shares of M/s. Globe Forex & Travels Ltd and it has thus become a subsdiary of the Company w.e.f. 10th Jan, 2013.

4. Employee Benefits

(a) Disclosure as required by Accounting Standard 15 (Revised) on Employee Benefits : (i) In respect of Gratuity a defined benefit scheme (based on actuarial valuation)

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation upon superannuation or on exit otherwise and is provided for on the basis of actuarial valuation made at the year end using projected unit method.

(ii) Leave salary - Compensated absents : The company also extends defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

(iii) In respect of Defined contribution Scheme : The company contributes 12% of salary for all eligible employees towards Provident Fund managed by the Central Government. Total expenses recognized towards Employer''s contribution to Provident Fund rS. 122.36 Lakhs (Previous year rS. 104.27 Lakhs).

5. Related Parties

(a) Name of related parties and nature of relationship where control exists are as under:

(i) Enterprises over which Key Management Personnel (i) M/s. Riddhi Portfolio (P) Ltd. and their relatives are able to exercise (ii) M/, Eastern Credit Capital (p) Ltd significant influence. (100% subsidiary of Riddhi Portfo|io (P) Ltd.)

(iii) M/s. Ramkrishna Rail & Infrastructure Pvt. Ltd.

(iv)M/s.ClifftoplnfrabuildPvt.Ltd.

(v) M/s. Northeast Infra Properties Pvt. Ltd.

(ii) Subsidiary of the Company M/s. Globe Forex & Travels Ltd

(iii) ESOP Trust of the Company M/s Ramkrishna Forgings Employee Welfare Trust

(iv) Key Management Personnel

Mahabir Prasad Jalan Chairman cum Whole Time Director.

NareshJalan Managing Director

Pawan Kumar Kedia Finance Director

(v) Relative of Key Management Personnel

Rashmi Jalan Wife of Mr. Naresh Jalan

6. Exchange Rate Difference

Foreign currency exchange difference Loss of rS. 56.85 Lakhs (Previous year Loss of rS. 58.16 Lakhs) on long term borrowing for acquisition of Fixed Assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R. 913 (E) dt. 29.12.2011) issued by Ministry of Corporate Affairs.

7. Operating Lease

The Company''s significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Profit & Loss Account.

8. Foreign Currency exposures that are not hedged by derivative instrument or otherwise as on 31st March, 2013 are asunder:

9. Segment information

a. Primary Segment Information : The Company is operating in a single segment namely Forgings. Information about Secondary Segments : Geographical

10. Earning per share (EPS)

EPS is calculated by dividing the profit attributable to the equity shareholder by the weighted average number of equity shares outstanding during the year.

11. Share Based Payment (EPS)

Under the Employee Stock Option Scheme ("ESOP 2009"), the Company has granted number of options to its eligible employees. Each option when exercised would be converted into one fully paid-up equity share of rS. 10/- of the Company. Options granted under the ESOP 2009 carry no rights to dividends and no voting rights till the date of exercise. At the reporting date, details of outstanding options held by the employees are as follows :

a. Employee stock option scheme

(i) The shareholders of the Company had approved the ESOP 2009 to grant 15,00,000 stock options convertible into 15,00,000 equity shares of rS. 10/- each to its permanent employees including director of the Company whether wholetime or otherwise in one or more tranches and on such terms and conditions as may be fixed or determined by its Board of Directors. The Compensation Committee in its meeting held on 12th September, 2009 has granted 4,68,159 Nos. options to be converted into equivalent number of equity shares. The above scheme is administered through an ESOP trust namely Ramkrishna Forging Employee Welfare Trust.

(ii) The ESOP Trust has been created to administer the scheme by purchase of shares from the open market/ fresh issue of shares by the Company, in accordance with the approvals from the Remuneration and Compensation Committee of the Company.

c. The employee share based payment plans have been accounted based on the intrinsic value method and accordingly rS. 30.20 Lakhs (Previous year rS. 67.00 Lakhs) have been charged as employee compensation cost.

Had the fair value method of accounting been used, the employee compensation cost would have been rS. 35.80 Lakhs (Previous yearrS. 78.63 Lakhs).

12. During the year the company has received the capital investment subsidy under Jharkhand Industrial Policy, 2001 of rS. 567.63 lakhs which has been adjusted with cost of respective fixed assets and depreciation has been recalculated retrospectively resulting in reversal of excess depreciation of earlier year rS. 200.43 lakhs.

Furhter the company has recognised a capital subsidy (in the form of sales tax refund) of rS. 738.27 lakhs under Jharkhand Industrial Policy, 2001 which has been credited to Capital Reserve.

13. Information related to Micro, Small and Medium Enterprises Development Act, 2006 (the Act) is disclosed hereunder. The information given below has been determined to the extent such parties have been identified on the basis of information available with the company:

14. Figures for the previous periods have been regrouped and reclassified to conform to the classification of the current period, where necessary.


Mar 31, 2012

A. Right, Preference and restrictions attached to Shares :

The Company has one class of equity shares having a par value of Rs 10/- per share. Each share holder is eligible for one vote per share held. The dividend proposed by the Board of Director is subject to the approval of the shareholderes in the ensuing Annual General meeting, 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 amount, in proportion to their shareholding.

For the year ended 31st March, 2012, the Board of Directors of the Company has recommended dividend ofRs 2 per share (Previous year Rs 2 per share) to equity shareholders aggregating to Rs 362.97 Lakhs (Previous year Rs 328.57 Lakhs). The total payout together with the Corporate Dividend Distribution Tax of Rs 58.88 Lakhs (Previous year Rs 53.3 Lakhs), will be Rs 421.85 Lakhs (Previous year Rs 381.87 Lakhs).

b. No securities convertible into equity/preference shares are issued by the Company during the year.

c. Share options granted under the employee share option plan (ESOP 2009) through trust route by acquisition of shares from the market. Refer Note No. 40.

d. The company has not reserved any shares for issue of option and contract/commitment for sales of shares /disinvestment.

e. The company during the preceding 5 years -

i. Has not allotted shares pursuant to contracts without payment being received in cash.

ii. Has not allotted shares as fully paid up by way of bonus shares.

iii. Has not bought back any shares.

i. There are no calls unpaid by Directors/Officers.

f. The company has not forfeited any shares.

(a) Securities

(i) Term loans from State Bank of India and Standard Chartered bank are secured by first pari-passu charge by way of equitable mortgage by deposit of title deeds of immovable properties (leasehold) at Adityapur Industrial Area, Jamshedpur and 7/40, Duffer Street. Bally Howrah and hypothecation of entire movable assets of the Company and excluding those assets for which there is an exclusive charge of other bankers and subject to charges of the Company's bankers created/to be created in their favour for working capital loans.

(ii) Term Loan from DCB bank is secured by the subservient charge on the current assets of the company and collateral security of land alongwith building at 72 Shakespeare Sarani, Kolkata - 700 017.

(iii) Term loan from ICICI Bank is secured by exclusive charge on the assets financed by them and first pari-passu charge by way of equitable mortgage of office at L & T Chambers, 16, Camac Street, 6th Floor, Kolkata- 700017 and land measuring around 18 acres at Mouza Bholadih, Thana no. 109, Dist Saraikella, Jharkhand.

(iv) Term loan from IOB Bank, DBS Bank Ltd and IDBI bank are secured by the specific charge on the assets financed by them.

(b) Guaranteed by Directors/Others :

(i) Term loans from SBI is further secured by the corporate guarantee of M/s. Riddhi Portfolio Private Limited.

(d) Interest Rate Term loan from financial institutions carries interest @ 9.95% to 14.50% p.a.

Repayment in monthly/quarterly/half yearly instalments.

VAT Deferrement Payment Scheme is interest free and payable in half yearly instalments of Rs 34.42 Lakhs each.

(a) Securities

(i) Working capital loans from banks are secured by first pari-passu hypothecation of all current assets of the Company and are also further secured by charge on the entire fixed assets located at Adityapur Industrial Area, Jamshedpur and Howrah, subject to prior charges in favour of banks created/to be created in respect of any existing/future financial assistance/accommodation which has been/may be obtained by the Company.

(ii) Short term loan from SIDBI is secured by a fixed deposit with them.

(b) Guaranteed by Directors/Others :

(i) Working capital loan from SBI is further secured by the corporate guarantee of M/s. Riddhi Portfolio Private Limited.

1. In response to an application made by the Company to the Central Government for approval of payment of increased remuneration to Chairman cum Whole Time Director and the Managing Director from 1st April, 2008 to 31st March, 2011 the Central Government, has vide its letter dated 29th February, 2012 assented to payment of remuneration of Rs 48,30,000 from 1st April, 2008 to 31st March, 2009 and Rs 84,00,000 from 1st April, 2009 to 31st March, 2010 to Managing Director and Rs 84,00,000 from 1st April, 2008 to 31st March, 2010 to Chairman cum Whole Time Director. Based on the above approval remuneration paid to the Chairman cum Whole Time Director and the Managing Director is in excess by Rs 38,36,400 and by Rs 50,96,400 for the year 2008-09 and 2009-10 respectively. The Company has again represented to the Central Government for reconsideration of its application and to accord its approval for payment of remuneration as proposed in the said application. The said representation is pending for reconsideration of the Central Government. However the remuneration paid during the year 2011-12 to Chairman cum Whole Time Director and the Managing Director is within the limits as laid down in section 309(3) read with Schedule XIII of the Companies Act 1956.

2. Contingent Liabilities and Commitments (to the extent not provided)

(Rs in Lakhs) Year ended 31/03/2012 31/03/2011

A. Contingent Liabilities

(a) Claims against the company not acknowledged as debt

(i) Electricity charges demand of Jharkhand State Electricity Board. 45.24 40.65 (Appeal pending before High Court, Jharkhand)

(ii) Demand for Income Tax for the AY2006-07 - 14.92 (Appeal pending before the Commissioner of lncome Tax (Appeals), Kolkata) Amount paid Rs 14.92 Lakhs

(iii) Demand for Income Tax for the AY2007-08 8.03 8.03 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(iv) Demand for Income Tax for the AY 2008-09 3.96 3.96 (Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata)

(v) Demand for Service Tax for the FY 2004-05, 2005-06, 2006-07 35.98 35.98 (upto July 2006) (Appeal pending before the Excise & Service Tax Appellate Tribunal, Kolkata)

(vi) Demand for Service Tax for the FY 2006-07 to 2009-10 23.50 - (Appeal pending before the The Additional Commissioner of Service Tax, Kolkata)

(vii) Demand for Sales Tax for the FY 2007-08 1.63 - (Appeal pending before the The Joint Commissioner of Sales Tax, Kolkata)

(b) Bills discounted with Banks 510.27 1,136.32

(c) Custom duty on Capital goods in ported under EPCGS cheme/ 1,486.22 1,471.11 Advance Licence, against which export obligation of Rs 11,082.73 Lakhs (Previous year Rs 11,455.60 Lakhs) is to be fulfiled

B. Commitments

(a) Estimated amount of contracts remaining to be executed on capital 611.30 414.48 account and not provided for

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation upon superannuation or on exit otherwise and is provided for on the basis of actuarial valuation made at the year end using projected unit method.

(ii) Leave salary - Compensated absents : The company also extends defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

(iii) In respect of Defined contribution Scheme : The company contributes 12% of salary for all eligible employees towards Provident Fund managed by the Central Government. Total expenses recognized towards Employer's contribution to Provident Fund Rs 104.27 Lakhs (Previous year Rs 88.44 Lakhs).

Note : * Amount received being balance amount of 75% of issue price for conversion of 7,70,000 warrants into equity shares.

** Excludes leave encashment and gratuity which is based on actuarial valuation provided on overall company basis.

3. Exchange Rate Difference

Foreign currency exchange difference Loss of Rs 58.16 Lakhs (Previous year Loss of Rs 24.29 Lakhs) on long term borrowing for acquisition of Fixed Assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R. 913 (E) dt. 29.12.2011) issued by Ministry of Corporate Affairs.

4. Operating Lease

The Company's significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Profit & Loss Account.

5. Share Based Payment

Under the Employee Stock Option Scheme ("ESOS 2006"), the Company has granted number of options to its eligible employees. Each option when exercised would be converted into one fully paid-up equity share of Rs 10/- of the Company. Options granted under the ESOS 2009 carry no rights to dividends and no voting rights till the date of exercise. At the reporting date, details of out standing options held by the employees are as follows :

a. Employee stock option scheme

(i) The shareholders of the Company had approved the ESOP 2009 to grant 15,00,000 stock options convertible into 15,00,000 equity shares of Rs 10/- each to its permanent employees including Director of the Company whether wholetime or otherwise in one or more tranches and on such terms and conditions as may be fixed or determined by its Board of Directors. The Compensation Committee in its meeting held on 12th September, 2009 has granted 4,68,159 Nos. options to be converted into equivalent number of equity shares. The above scheme is administered through an ESOP trust namely Ramkrishna Forging Employee Welfare Trust.

(ii) The ESOP Trust has been created to administer the scheme by purchase of shares from the open market,/ fresh issue of shares by the Company, in accordance with the approvals from the Remuneration and Compensation Committee of the Company.

c. The employee share based payment plans have been accounted based on the intrinsic value method and accordingly Rs 67.00 Lakhs (Previous year Rs 95.29 Lakhs) have been charged as employee compensation cost.

e. The loans advanced to the Trust for purchase of shares from the market as at March 31, 2012, is Rs 1074.47 Lakhs (Previous year Rs 939.25 Lakhs). The repayment of the loan by the trust is dependent on the exercise of options by the employees and/or the market price of the underlying equity shares of the unexercised options at the end of the exercise period.

7. Information related to Micro, Small and Medium Enterprises Development Act, 2006 (the Act) is disclosed hereunder. The information given below has been determined to the extent such parties have been identified on the basis of information available with the company :

8. 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 of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended 31st March,2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification. The adoption of Revised Schedule VI for previous year figures does not impact recognition and measurement principles followed for preparation of financial statements except for accounting for dividend on investments in subsidiaries.


Mar 31, 2011

(Rs. in Lakhs)

31.03.2011 31.03.2010

(1) Contingent Liability, not provided for in respect of:

(a) (i) Claim/Disputed Liabilities not acknowledged as debt:

Following demand is disputed by the Company and not provided for -

Electricity charges demand of Jharkhand State Electricity Board 40.65 40.65 (appeal pending before High Court, Jharkhand)

(ii) a) Demand forlncome Tax for the A.Y.2006-07 14.92 14.92 [Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata] Amount paid Rs. 14.92 Lakhs

b) Demand for lncome Tax for the A.Y.2007-08 8.03 10.43 [Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata]

c) Demand for lncome Tax for the A.Y.2008-09 3.96 NIL [Appeal pending before the Commissioner of Income Tax (Appeals), Kolkata]

b) Demand for Service Tax for the F.Y. 2004-05,2005-06, 2006-07 35.98 NIL (upto July 2006) [Appeal pending before the Excise & Service Tax Appellate Tribunal, Kolkata]

(b) Bill Discounted with Bank 1136.32 231.36

(2) Secured Loans:

Term Loans from State Bank of India and Standard Chartered bank are secured by first pari-passu charge by way of equitable mortgage by deposit of title deeds of immovable properties (leasehold) at Jamshedpur and hypothecation over present movable assets of the Company subject to prior charges of the Companys bankers created/to be created in their favour for working capital loans and specific term loan requirements.

Working Capital Loans from banks are secured by first pari-passu hypothecation of all current assets of the Company. Further, such loans from banks are also secured by charge on certain immovable properties located at Jamshedpur and Howrah, subject to prior charges in favour of banks created/to be created in respect of any existing/future financial assistance/accommodation which has been/may be obtained by the Company.

Premises Loan from DBS Bank Limited is secured by the exclusive mortgage of the office building including land situated at 72, Shakespeare Sarani, Kolkata - 700 017.

Term loan from ICICI Bank Limited (earlier known as The Bank of Rajasthan Limited) is secured by the first pari- passu mortgage of the properties situated at L & T Chambers, 6th Floor, 16, Camac Street, Kolkata - 700 017 and land measuring around 18 acres at Mauza Bholadih, Sariakela.

Term loan from CITI Bank, IOB Bank and IDBI bank are secured by the specific charge on the assets financed by them.

Term loan from HDFC bank is secured by a fixed deposit of Rs. 200.00 Lakhs.

Term loan from ICICI Bank is secured by first pari-passu charge by way of equitable mortgage of corporate office at L &T Chambers, 16, Camac Street, 6th Floor, Kolkata - 700 017 and land measuring around 18 acres at Mouza Bholadih, Thana no. 109, Dist. Saraikella, Jharkhand and exclusive charge on the assets financed by them.

Term Loans and Working Capital Loan from SBI is further secured by the corporate guarantee of IWs. Riddhi Portfolio Private Limited.

Short Term Loan from SIDBI up to Rs. 15 Lakhs secured by a fixed deposit with them.

(3) The Company has export obligation against Import License taken for import of Capital Goods under Export Promotion Capital Goods Scheme in US $ 322.16 Lakhs amounting to Rs.13,742.06 Lakhs (Previous year in US $ 333.47 Lakhs amounting to Rs. 14,498.81 Lakhs).

(4) The Companys significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Profit & Loss Account.

(5) Foreign currency exchange difference gain of Rs. 24.29 Lakhs (Previous year Loss of Rs. 519.26 Lakhs) on amount borrowed for acquisition of Fixed Assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R. 225 (E) dt. 31.03.2009) issued by Ministry of Corporate Affairs.

(6) a) The Company has issued 10,00,000 warrants to Ms. Lata Bhanshali and 29,00,000 warrants to M/s. Eastern Credit Capital Limited, Promoter group on a preferential basis at a price of Rs. 107.50/- per warrant during the year 2009-2010. The warrants can be converted into equity shares of Rs. 10/- each at a premium of Rs. 97.50/- within 18 months from the date of allotment i.e. 20th February, 2010.

The Company has received 25% of the issue price for 39,00,000 warrants at the time of allotment of the warrants as per SEBI (Issue of Capital and Disclosure Requirements) Regulations, 2009.

During the year the Company has received a request for the conversion of 9,50,000 warrants into equity shares from M/s. Eastern Credit Capital Limited, Promoter group, along with the balance consideration of 75% of the issue price amounting to Rs.765.95 Lakhs. The Company in its Board Meeting held on 4th April, 2011 has allotted 9,50,000 equity shares to M/s. Eastern Credit Capital Limited, Promoter group, by conversion of 9,50,000 warrants into equity shares. The above amount is lying in the bank accounts of the Company as on 31 st March, 2011.

b) The Diluted EPS for the year ending on 31 st March, 2011 has been calculated taking into account the 39,00,000 warrants issued by the Company on preferential basis which are pending for conversion into equity shares of the Company. The warrant holder has a right of conversion of these warrants into equity shares of the Company within 18 months from the date of allotment i.e. 20th February, 2010.

(7)Rs. 0.28 Lakhs (Previous year Rs. 0.11 Lakhs) has been paid as legal fee to a solicitor firm where one of Director is a partner, and Rs. 0.50 Lakhs paid to a Director towards technical consultancy charges (Previous year Rs. 0.50 Lakhs).

(8) Miscellaneous Expenses includes expenses (Net) relating to earlier years amounting to Rs. 4.39 Lakhs (Previous year Income (Net) Rs. 4.78 Lakhs) as per following details:

(9) a) Disclosure as required by Accounting Standard 15 (Revised) on Employee Benefits:

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation upon superannuation or on exist otherwise and is provided for on the basis of actuarial valuation made at the year end.

ii) Leave salary - Compensated absents: The Company also extents defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

iii) In respect of Defined contribution Scheme : The Company contributes 12% of salary for all eligible employees tow- ards Provident Fund managed by the Central Government. Total expenses recognized towards Employers contribution to Provident Fund Rs.88.44 Lakhs (Previous year Rs. 77.11 Lakhs)

(10) Employees Stock Option Scheme

a) The shareholders of the Company had approved the ESOP scheme 2009 to grant 15,00,000 stock options convertible into 15,00,000 equity shares of Rs. 10/- each to its permanent employees including Director of the Company whether Wholetime or otherwise in one or more tranches and on such terms and conditions as may be fixed or determined by its Board of Directors. The Compensation Committee in its meeting held on 12th September, 2009 has granted 4,68,159 nos. options to be converted into equivalent number of equity shares. The above scheme is administered through an ESOP trust namely Ramkrishna Forgings Employee Welfare Trust.

b) The ESOP Trust has been created to administer the scheme by purchase of shares from the open market/fresh issue of shares by the Company, in accordance with the approvals from the Remuneration and Compensation Committee of the Company.

e) The employee share based payment plans have been accounted based on the intrinsic value method and accordingly Rs.95.29 Lakhs (Previous year Rs. 57.01 Lakhs) has been charged as employee compensation cost.

Had the fair value method of accounting been used, the employee compensation cost would have been Rs. 104.31 Lakhs (Previous year Rs. 62.40 Lakhs).

g) The loans advanced to the Trust for purchase of shares from the market as at March 31,2011, is Rs. 939.25 Lakhs. The repayment of the loan by the trust is dependent on the exercise of options by the employees and/or the market price of the underlying equity shares of the unexercised options at the end of the exercise period.

(11) Sales includes own manufactured items at cost Capitalised Rs. NIL (Previous year Rs. 73.15 Lakhs).

(12) Loans and Advances includes due from Officers Rs. NIL (Previous Year Rs. 1.04 Lakhs) (Maximum Balance due during the year Rs. 1.04 Lakhs).

(13) Segment Information:

(a) Primary Segment Information :The Company is operating in a single segment namely Forgings.

Note: During the year export constitute 10% or more of revenue from external Sales. All the plants of the Company are located in India and accordingly debtors and Stock lying outside India has been considered segment assets outside India.

(14) The Company has not received any intimation from "Suppliers" under the Micro, Small and Medium Enterprises Development Act, 2006 and therefore disclosure, if any, relating to amounts unpaid at the year end together with the interest paid/payable as required under the Act have not been given.

(15) a) Details of Remuneration to Chairman, Managing Director/Executive Director and Director Finance:

* Exclude leave encashment and gratuity which is provided based on the actuarial on overall Company basis.

b) In response to an application made by the Company to the Central Government for approval of payment of increased remuneration to Chairman cum Wholetime Director and the Managing Director from 1st April, 2008 to 31 st March, 2011 the Central Government, has vide its letter dated 27th January, 2011 assented to payment of remuneration on the basis of the permissible limit as laid down in Section 309(3) read with Schedule XIII of the Companies Act, 1956 or remuneration of Rs. 41.22 Lakhs to Managing Director and Rs.54.05 Lakhs to Chairman cum Wholetime Director whichever is higher. Based on the above approval remuneration paid to the Chairman cum Wholetime Director and the Managing Director is in excess by Rs. 51.90 Lakhs and by Rs. 84.14 Lakhs for the year 2009-10 and 2008-09 respectively.The Company has again represented to the Central Government for reconsideration of its application and to accord its approval for payment of remuneration as proposed in the said application.The said representation is pending for reconsideration of the Central Government. However, the remuneration paid during the year 2010-11 to Chairman cum Wholetime Director and the Managing Director is within the limits as laid down in Section 309(3) read with Schedule XIII of the Companies Act, 1956.

(16) Related Party Disclosures:

(1) Name of related parties and nature of relationship where control exists are as under:

(a) Enterprises over which Key Management Personnel and (i) M/s. Riddhi Portfolio (P) Ltd. their relatives are able to exercise significant influence (ii) M/s. Eastern Credit Capital Ltd.

(100% subsidiary of Riddhi Portfolio (P) Ltd.)

(b) Trust of the Company M/s Ramkrishna Forgings Employee Welfare Trust

(c) Key Management Personnel

(i) Mahabir Prasad Jalan Chairman cum Wholetime Director

(ii)NareshJalan Managing Director

(iii)Pawan Kumar Kedia Finance Director

(17) Additional information required by Para 3 & 4 of Part II of Schedule VI to the Companies Act, 1956.

(b) Annual Capacity on maximum utilisation basis.

(c) In respect of Ring Rolling Facilities installed capacity is dependent on Product mix, which in turn is decided on the basis of actual demand for various products from time to time, it is not feasible for the Company to give exact installed capacity. With respect to the available machine hour and production cycle time the Company is capable of producing 8.0 Lakhs rings. The Company has, however, indicated installed capacity on the basis of years product mix, as certified by the Chairman and Managing Director and being a technical matter accepted by the Auditors as correct.

(18) Previous year figures have been regrouped/re-arranged wherever necessary to confirm to this years classifications.


Mar 31, 2010

(1) Secured Loans

Term Loans from SBI are secured by way of Equitable Mortgage by deposit of title deeds of immovable properties (leasehold) at Jamshedpur and hypothecation over movable assets of the Company, both present and future, subject to prior charges of the Companys Bankers created/to be created in their favour for working capital and specific term loan requirements.

Working Capital Loans from Banks are secured by pari-passu hypothecation of all current assets of the Company. Further such loans from Banks are also secured by charge on certain immovable properties located at Jamshedpur and Howrah, subject to prior charges in favour of Banks created/to be created in respect of any existing/future financial assistance/accommodation which has been/may be obtained by the Company.

Premises Loan from DBS Bank Limited is secured by the exclusive mortgage of the property situated at 72, Shakespeare Sarani,Kolkata-700 017.

Term Loan from The Bank of Rajasthan Limited is secured by the exclusive mortgage of the properties situated at L &TChambers, 6th Floor, 16, Camac Street, Kolkata - 700 017 and land measuring around 18 acres at Mauza Bholadih, Sariakela.

Term Loan from CITI Bank, HDFC Bank, IOB Bank and IDBI Bank are secured by the specific charge on the assets financed by them.

The Term Loan from HDFC Bank is further secured by the personal guarantee of Mr. Naresh Jalan, Managing Director, of the Company.

The Term Loan and Working Capital from SBI Bank is further secured by the Corporate Guarantee of M/s. Riddhi Portfolio Private Limited. (Formerly known as Basuki Portfolio Private Limited.)

Short Term Loan from SIDBI upto Rs. 25 Lakhs secured by a fixed deposit with them.

(2) The Company has export obligation against Import License taken for Import of Capital Goods under Export Promotion Capital Goods Scheme (In US $ 333.47 Lakhs) amounting to Rs. 14,498.81 Lakhs (Previous year US $ 333.47 Lakhs in Rs. 14,498.81 Lakhs)

(3) The Companys significant leasing agreements are in respect of lease for lands. These leasing agreements range between 30 to 99 years. The aggregate lease rental payables are charged as rent in Profit & Loss Account.

(4) Foreign Currency exchange difference gain of Rs. 519.26 Lakhs (Previous year Loss of Rs. 613.65 Lakhs) on amount borrowed for acquisition of fixed assets, has been adjusted to carrying cost of fixed assets which is in compliance with the treatment prescribed under AS 11 notification - Companies (Accounting Standards) Amendment Rules, 2009 (G.S.R. 225 (E) dt. 31.03.2009) issued by Ministry of Corporate Affairs.

(5) a) The Company has issued 10,00,000 Nos. equity shares and 10,00,000 Nos. warrants to Ms. Lata Bhanshali and 1,00,000 Nos. equity shares and 29,00,000 Nos. warrants to Promoter group on a Preferential basis at a price of Rs.107.50/- per share. The warrants can be converted into equity shares of Rs. 10/- each at a premium of Rs. 97.50/- within 18 months from the date of allotment i.e. 20th February, 2010.

c) The unspent money of Rs. 110.00 Lakhs out of the earlier preferential issue which was lying in the fixed deposit with the bankas on 31 st March, 2009 has been utilized for the repayment of project liabilities.

d) The Diluted EPS for the year ending on 31 st March, 2010 have been calculated taking into account, the 39,00,000 Nos. warrants issued by the Company to its Promoter group and to Ms. Lata Bhanshali on preferential basis which are pending for conversion into equity share of the Company. The terms of conversion is within 18 months from the date of allotment i.e. 20th February, 2010.

(6) Rs. 0.11 Lakhs (Previous year Rs. 1.03 Lakhs) has been paid as legal fee to a solicitor firm where one of Director is a Partner, and Rs. 0.50 Lakhs paid to a Director towards technical consultancy charges (Previous year Rs. NIL).

The Company has funded scheme for payment of Gratuity to all eligible employees calculated at specified number of days of last salary drawn depending upon tenure of service for each year of completed service subject to minimum service of five years payable at the time of separation upon superannuation or on exist otherwise and is provided for on the basis of actuarial valuation made at the year ended.

ii) Leave salary - Compensated absents :The Company also extents defined benefit plans in the form of compensated absences to employees. Provision for compensated absences is made on basis of actuarial valuation at the year end.

iii) In respect of Defined contribution Scheme :The Company contributes 11% of salary for all eligible employees towards Provident Fund managed by the Central Government. Total expenses recognized towards Employers contribution to Provident Fund Rs. 77.11 Lakhs (Previous year Rs. 68.32 Lakhs)

(7) Employees Stock Option Scheme

a) The shareholders of the Company in their Annual General Meeting held on 22nd August, 2009, have approved the ESOP Scheme to grant 15,00,000 Nos. stock options convertible intol 5,00,000 Nos. equity shares of the nominal value Rs. 10/- each to its permanent employees including Director of the Company whether wholetime or otherwise in one or more tranches and on such terms and conditions as may be fixed or determined by its Board of Directors. The above scheme is administered through an ESOP trust namely Ramkrishna Forgings Employee Welfare Trust.

b) The ESOP Trust has been created to administer the scheme by purchase of shares from the open market/fresh issue of shares by the Company, in accordance with the approvals from the Remuneration and Compensation Committee of the Company.

c) The Compensation Committee in its meeting held on 12th September, 2009 has granted 4,68,159 Nos. options to be converted into equivalent number of equity shares.

f) The employee share based payment plans have been accounted based on the intrinsic value method and accordingly Rs. 57.01 Lakhs has been charged as employee compensation cost.

Had the fair value method of accounting been used, the employee compensation cost would have been Rs. 62.40 Lakhs.

(8) Sales includes own manufactured items at cost capitalised Rs. 73.15 Lakhs (Previous year Rs. 550.53 Lakhs).

(9) Loan and Advances includes due from Officers Rs. 1.04 Lakhs (Opening outstanding balance) (Previous Year Rs. 1.04 Lakhs) (Maximum Balance due during the year Rs. 1.04 Lakhs).

(10) Segment Information:

(a) Primary Segment Information : The Company is operating in a single segment namely Forgings.

(b) Secondary Segment Information : Not applicable, as all the plants of the Company are located in India and Export does not constitute 10% or more of revenue from external sales.

(11) Amount due to Creditors registered under Micro, Small and Medium Enterprises Development Act, 2006 as on 31.03.2010 is Rs. NIL. Further, there is no interest accrued, payable under the said act at the close of the year. The disclosure above is based on the information available with the Company regarding status of the suppliers under MSME.

(b) In response to an application made by the Company to the Central Government for approval of payment of increased remuneration to Chairman cum Whole Time Director and Managing Director from 1 st April, 2008 to 31 st March, 2011 the Central Government, has vide its letter dated 18th March, 2010 assented to payment of remuneration on the basis of the permissible limit as specified under Schedule XIII of the Companies Act, 1956 or remuneration last drawn by the said Managerial Personnel whichever is higher.

The Company has paid the remuneration of Rs. 122.94 Lakhs and Rs. 96.60 Lakhs to Chairman cum Whole Time Director and Managing Director respectively during the year 2009-10 which is an excess of the limit laid down in the Section 309 (3) read with Schedule XIII of the Companies Act, 1956. The excess remuneration is amounting to Rs. 96.49 Lakhs for FY 2008-2009 and Rs. 52.48 Lakhs for FY 2009-2010.

The Company has made a representation to the Central Government for reconsideration of its application and accord its approval to the Company for payment of remuneration as proposed in the said application. The said representation is pending for consideration of the Central Government.

b) The Company has recognized Deferred Tax Assets on business loss including unabsorbed depreciation as in view of the management there is reasonable certainty that assets will be realized in future.

c) Rs. 278.00 Lakhs (Previous year Rs. 81.09 Lakhs) has been provided in the account towards Minimum Alternate Tax for the year ended 31 st March 2010 in terms of Section 115JB of the Income Tax Act, 1961. MAT Credit of Rs. 271.00 Lakhs as been recognized as an assets by crediting Profit & Loss Account in the books of Accounts, based on the convincing evidence that the company will pay Normal Income Tax during the specified period.

(12) Earnings Per Share: (Basic & Diluted)

(13) Additional information required by Para 3 & 4 of Part II of Schedule VI to the Companies Act, 1956.

(b) Annual Capacity on maximum utilisation basis.

(c) In respect of Ring Rolling Facilities installed capacity is dependent on product mix, which in turn is decided on the basis of actual demand for various products from time to time, it is not feasible for the Company to give exact installed capacity. With respect to the available machine hour and production cycle time the Company is capable of producing 8.0 Lakhs rings. The Company has, however, indicated installed capacity on the basis of years product mix, as certified by the Chairman and Managing Director and being a technical matter accepted by the Auditors as correct.

(14) Previous year figures have been re-grouped/re-arranged wherever necessary to confirm to this years clssifications.

 
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