Mar 31, 2015
1. rights, preference & restriction attached To shares A Equity Shares
the Company has only one class of equity Share having a par value of Rs
10/- each. each holder of equity Share is entitled to one vote per
share. the Company declares and pays dividend in Indian rupees. the
Dividend proposed by the Board of Directors is subject to the approval
of the shareholders in the ensuing annual general meeting except in the
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
to their shareholding.
A Preference Shares
i. 13,00,000 5% Redeemable Cumulative preference Share of Rs 10/- each
fully paid up were allotted on 31-03-2003, which was due for redemption
at any time between 6th and 10th year from the date of allotment at a
premium of Rs 25/- per share and the date of redemption is 31.03.2013.
However the company had obtained the consent of the preference share
holders to extend the period of redemption by another period of two
years and will now become due for redemption on 30.03.2015 on existing
terms and conditions. the company has obtained extension consent of the
preference share holders to extend the period of redemption by another
one year and will now become due for redemption on 29.03.2016 on
existing terms and conditions.
ii. 31,60,000 4% Redeemable Cumulative preference Share of Rs 10/- each
fully paid up were allotted on 24-09-2004, which was due for redemption
at any time between 7th and 8th year from the date of allotment at a
premium of Rs 25/- per share and was due to redeemed on 24.09.2012. the
Company obtained the consent of preference share holder in their
meeting held on 20.09.2012 to extend the period of redemption upto
23.03.2013. However due to continuing Financial Crunch the company had
further obtained the consent of preference Share holders to extend the
period of redemption by another period of two years and had become due
for redemption on 22.03.2015 on existing terms and conditions. the
company has obtained extension consent of the preference share holders
to extend the period of redemption by another one year and will now
become due for redemption on 21.03.2016 on existing terms and
conditions.
iii. 2,24,99,920 5% Redeemable non Cumulative preference Share of Rs
10/- each fully paid up were allotted on 31- 03-2010, which is
redeemable at a premium of Rs 90/- per share at any time within 20th
year from the date of allotment.
2. Term loans and FUNDED INTEREST TERM LOANS :
a term loans from IDBI Bank limited is secured by equitable mortgage of
lease hold land and First charge on certain Fixed Assets of the
company's Kalyani unit on pari-passu basis with the other lenders and
personal guarantee of Managing Director together with corporate
guarantee of M/s. Ramsarup Investments ltd and pledge of 3507848 equity
shares of Company held by other related Body Corporates. the Banker had
invoked entire equity shares of the company pledged with them by some
of the group companies and had adjusted the proceeds against their over
dues in part by sale of only 2389034 equity shares and balance 1118814
equity shares are held by IDBI Bank limited as their holding. the term
loan was repayable in quarterly installments, but the company has
defaulted in payment and as such the entire loan has been included in
current liability.
b Working Capital term loan (WCtl) and Funded Interest term loan (FItl)
are secured by all the assets covered under the working capital
facilities in short term borrowing .the loan was repayable in quarterly
installments, but the company has defaulted in payment and as such the
entire loan has been included in current liability.
c Rupee term loan from punjab national Bank is secured by way of
hypothecation of Factory Shed & Building, plant & Machineries and other
Fixed assets of Durgapur unit and also equitable mortgage of the
Factory shed & land belonging to Vanguard Credit & Holding pvt ltd, a
group company on pari-passu basis with other term lenders along with
its corporate guarantee and personal guarantee of Managing Director of
the company. the loan was repayable in 24 equal quarterly installments
of Rs. 300 lacs each commencing from 1st April 2011, but the company
has defaulted in payment of interest and installments, therefore loan
has been recalled and accordingly the same has been included in current
liability.
d Rupee term loan from Axis bank ltd. is secured by way of
hypothecation of Factory Shed & building, plant & Machineries and other
Fixed assets of Durgapur unit and also equitable mortgage of the
Factory shed & land belonging to Vanguard Credit & Holding pvt. ltd. a
group company on pari-passu basis with other term lenders along with
its corporate guarantee and personal guarantee of Managing Director of
the company. the loan of Rs. 4,500 lacs was repayable in 20 equal
quarterly installments commencing from April 2010, Rs. 5,000 lacs in 14
equal quarterly installments commencing from April 2012 and Rs. 5,000
lacs transferred from Short term loan was repayable in one installment
but due installments have not been paid till date and accordingly the
same has been classified as current liability.
e term loans for various modules of Integrated Steel project at
Kharagpur have been tied up under multiple banking arrangements and
secured by way of equitable mortgage of entire land & Building on pari
passu basis. the lender Banks are having 1st charge on movable fixed
assets of the specific module of the project on pari passu basis with
other term lenders of specific modules and 2nd pari passu charge on the
said assets on a reciprocal basis and further secured by personal
guarantee of the Managing Director of the Company and some of the body
corporate. Since neither the installment due for repayment nor interest
has been serviced as such all the accounts have become overdue to that
extent. the term loan was repayable in quarterly installments, however
the company has defaulted in payment of interest and stipulated
installments, therefore the loan has been recalled and this has been
included in current liability.
Working Capital term loan (WCtl) and Funded Interest term loan (FItl)
were to be repaid in quarterly installments but the same have not been
paid and to the said extent it has become overdue. the Working Capital
term loan was repayable in quarterly installments, but the company has
defaulted in payment of interest / stipulated installments, therefore
the loan has been recalled and included in current liability.
f term loan from ICICI Bank ltd. was provisionally secured by way of
first equitable mortgage of all immovable properties along with WBIDC
ltd. and hypothecations of movable assets other than book debts, stock
of raw material, finished, semi finished goods of the Shyamnagar unit &
guaranteed by Managing Director of the Company. However WBIDC has not
provided noC for the same. the term loan is further secured by pledge
of 5,00,000 equity shares of the company held by promoters group
company which has been further supplemented by another 5,37,970 equity
shares of the company held by other companies/group companies for
further financing credit facilities to Ramsarup Infrastructure one of
the unit of the company. the term loan was repayable in 30 quarterly
installments commencing from June, 2013, but the company has defaulted
payment of interest and as such loan has been recalled and hence this
has been included in current liability.
g the term loan from WBIDC ltd was secured by way of 1st equitable
mortgage of immovable property and hypothecation of all movable fixed
assets pertaining to Shyamnagar unit and personal guarantee of Managing
Director of the company. the debt has been recalled by the WBIDC ltd.
and the amount of Rs. 1422.46 lacs has been included under the head
current liabilities. Since 30.07.2012 WBIDC has invoked the provision
of section 29(1) of the State Financial Act 1951 by which they have
taken possession of the Shyamnagar unit with its fixed assets including
plant and machinery mortgage / hypothecated to them.
h Working capital term loan and Funded Interest term loan of Shyamnagar
unit from united Bank of India was repayable in 20 quarterly
installments and is secured by assets against the working capital
facilities. But the due amount has not been paid till date, hence the
loan has been recalled and therefore this has been included in current
liability.
i term loan from IReDA is secured by way of First charge by creation of
mortgage on all immovable properties & hypothecation of movable assets/
properties both existing and future pertaining to 3.75 MW Wind Farm
project at Village Khori, taluka Sakri, District Dhule, in the State of
Maharashtra and elsewhere excluding specified movables to be charged to
bankers for Working Capital Borrowings as agreed By IReDA. the loan was
Repayable in 24 equal quarterly installments of Rs. 52 lacs commencing
from 31st March 2006 and finally due on 31st march 2012 but last 9
quarterly installments w.e.f. 4th quarter of 2009-10 up to 4th quarter
2011-12 have not been paid and also defaulted in payment of interest
accrued thereon, hence the entire loan has been classified as Current
Borrowing.
j long term loan has been classified as secured on basis of available
securities and market value of Fixed Assets as estimated by the
management which has been relied upon. However no current valuation
report has been obtained.
k Funded Interest term loan (FItl) was on account of Cash credit
facility from ICICI Bank Repayable in 30 quarterly installments from
June,2013. However due to non servicing of interest the account turned
overdue and the entire facility was recalled by the bank and as such
the amount has been classified as current borrowings.
l the loan has been classified as secured on basis of available
securities and market value of fixed assets as estimated by the valuer
and that it has been shown as current borrowings as debts have been
recalled and/or the company is in default in paying the installments
and interest thereon. Since the terms &conditions of the term loan,
Working
A From Banks :
i) Working Capital facilities from banks for Kalyani unit are secured
by hypothecation of stock of raw materials, finished goods, stock in
process, stores & spares etc. and book debts and personal guarantee of
Managing Director of the Company and one of his relative together with
corporate guarantee of Ramsarup Investments ltd and collaterally
secured by way of equitable mortgage on leasehold land and Building
thereon at Kalyani on pari-passu basis with the Consortium of Banks and
IDBI Bank limited and 2nd Charge on Fixed Assets financed by IDBI Bank
limited and accordingly taking the estimated market value of the fixed
assets by the management the same has been classified as secured loan.
ii) Working Capital facilities from united Bank of India are secured by
hypothecation of stock of raw materials, finished goods, stock in
process, stores & spares etc. and book debts and second charge on its
Fixed Assets at Shyamnagar unit and personal guarantee of Managing
Director together with corporate guarantee of M/s.
Ramsarup Investments limited but the cash credit facility has already
been recalled .
iii) Working Capital term loan, FItl and Cash Credit facility from
united Bank of India have become overdue due to non-payment of
installments and/or servicing of the interest as such provision for
interest has been made up to June 2014 on the basis of rates available
in sanction letter at regular interval rest or as per interest debited
by the bank where available.
iv) All the Bank Borrowings have become overdue, due to non-payment of
installment of loan and interest thereon as per the terms of sanction.
v) Working Capital Facilities from punjab national Bank and IDBI Bank
ltd are secured on pari-passu basis by hypothecation of entire stocks,
stock in process, Finished goods, stores & spares, stocks-in-transit,
stock lying with others for conversion and book debts of Durgapur unit
and further secured by personal guarantee of Managing Director of the
Company. First charge on fixed asset of Durgapur unit is already held
by punjab national bank on term loan Account and therefore taking the
estimated market value of the fixed asset, short term borrowings have
been classified as secured.
vi) Working Capital Facility from ICICI Bank Secured against
hypothecation of Stock of Raw material, Work in progress, Consumable
Stores etc and book debts of Infrastructure Division and pari pasu
charge on fixed assets with Development Credit Bank and further secured
by 1037970 equity shares of the company held by some of the Group
companies and personal guarantee of Managing director.
vii) Working Capital Facility in infrastructure Division from
Development Credit Bank is secured against hypothecation of stock &
book Debts and pari-pasu Charge on entire fixed assets with ICICI Bank
ltd and personal guarantee of Managing director.
viii) Working Capital / Bill discounting facility from SIDBI is partly
secured by First charge on the Current Assets of M/s. n.C. Das &
Company which is one of the unit of Infrastructure Division of the
company together with personal guarantee of Managing Director.
ix) Amount due to IDBI Bank ltd in Infrastructure division secured by
pari passu first charges on its Assets of the Company with other
lenders.
x) Working Capital facilities from punjab national Bank for the Mini
Blast Furnace at Kharagpur is secured by Hypothecation of entire stock
and book debts of the unit and personal guarantee of Managing Director
and collaterally secured by 3rd charge on plant & Machinery of the unit
on pari passu basis with the charges created and/or to be created by
the company in favour of the other working capital lenders. this
facility has become overdrawn due to non servicing of accumulated
interest and some of other terms of sanction.
xi) All Secured/unsecured loan from Banks , Financial Institutions ,
etc. are guaranteed by Managing Director of the company.
B From Financial Institution :
Some of the loans from financial institutions are covered by pledge of
certain equity shares of the company held by various group companies
and Managing Director, subservient charges on Movable Fixed Assets,
hypothecation of Heavy equipments and/or equitable mortgage of land
held by some of the group companies along with personal guarantee of
Managing Director. this facility has been recalled due to non servicing
of accumulated interest and terms of sanction.
C Unsecured Loans :
loans from Related parties / Group Companies are interest free and
repayable on demand. Some of the group entities had pledged the shares
for credit facilities granted to the company but shares were invoked
for non payment of the dues and the banks on disposal of such shares
had credited the proceeds in the account of the company against their
dues in part. to the said extent, the amount is further included in the
loan payable to them.
D 1} Borrowing from Banks are not confirmed in absence of statements of
accounts and confirmation from them.
2} to the best of our information and explanations given to us some of
the lender banks have already assigned their debts together with the
underline securities, right title and interest thereon to some of the
Assets Re-construction Company registered with the RBI pursuant to
section 3 of the SARFAeSI Act 2002. But no impact has been given in the
financial statements in absence of any documentation to this effects.
E Interest on all the Borrowings from Banks and Financial Institutions
has been provided up to June 2014 at the specified rates but no
provision has been made in the Accounts for the period from1st July,
2014 to 31st March, 2015 amounting to Rs. 395.84 Crores and to this
extent the loss in the Financial Statements and liability to the Banks
for the year is understated.
3. All contracts on Capital Account has been kept in abeyance till
further development.
4. Capital Work in progress includes some of the equipment relating
to wire drawing machine amounting to Rs. 1661.21 lacs which were
imported are lying at Durgapur Dry port pending clearance of original
custom duty of Rs. 50 lacs (approx), of which actual liability can only
be ascertained at the time of clearance.
NOTE: the Company has made Investment in the equity of Moira Madhujore
Coal ltd. to whom the Coal Block at Moira Madhujore was allotted
jointly with other beneficiaries and subsequently due to various
reasons, the Coal Mine may be deal located and the rights in coal block
and investment thereon is likely to be affected.
5. trade Receivables both non-Current & Current together with
Advances to Suppliers & others are unconfirmed and some of them are
long outstanding which may be doubtful of recovery. It is estimated
that substantial debts may become doubtful of recovery for which no
provision has been made as the management is of the opinion that steps
will be taken to realize the money.
*1) All FDRs and Margin Money are stated to be held by the banks
against letter of guarantees issued by them. 2) Balance in FDR/Margin
money is as certified by the management as balances are unconfirmed by
the banks.
NOTE: the Company is having its Wind Mills in the name of Ramsarup
Vidyut where the energy Bills for the utilization of electric power, by
the MSeDCl for 5 months could not be raised as the necessary
information's were not available from Suzlon Global Services ltd.
however the estimated energy Bill {revenue} could be of Rs. 17 lakhs
(approx), which has not been accounted for. Similarly, due to various
dispute with Suzlon Global Services ltd., the liability for maintenance
of the Wind Mill amounting to Rs. 38.09 lakhs has not been provided
for. Due to the above reason the revenue and related expenses thereon
has not been recognized in the Accounts.
6. DISCLOSER PURSUANT TO ACCOUNTING STANDARD - 15 (REVISED) EMPLOYEES
BENEFITS
a) Defined Contribution Plans
employer- established provident fund trust are treated as defined
benefits plans. the company in its Shyamnagar unit has established a
provident fund trust namely "nicco Steels limited Workmen's provident
Fund" which is in line with provident Fund & Miscellaneous provision
Act, 1952.the plan guarantees interest at the rate notified by
provident Fund Authorities . the contribution by the employer &
employee together with interest accumulated thereon are payable to
employees at the time of separation from the company or retirement ,
whichever is earlier. the benefit vest immediately on rendering of the
services by the employee. But for last few years the manufacturing
activities were suspended and WBIDC has taken physical possession of
the unit since August 2012.
the guidance on implementing AS 15, employee Benefit (Revised 2005)
issued by the Accounting Standard Board (ASB) states that Benefits
involving employer established provident funds, which require benefit
shortfalls to be compensated are to be considered in defined benefit
plans. the Actuarial Society of India has issued the final guidance for
measurement of provident fund liabilities. As explained to us there is
no shortfall as on 31st March 2015.
b) Gratuity
In Keeping with the company Gratuity scheme (Defined Benefit plan)
eligible employees are entitled to gratuity benefits (at half months
eligible salary for each completed year of service on Retirement /
Death /termination). Vesting occurs upon completion of 5 years of
service subject to the payment of Gratuity Act, 1972.
the principal assumptions used in the calculation are the (1) Discount
Rate, (2) Salary increase. the Discount rate is based upon the market
yields available on Government Bonds at the accounting date with a term
that matches debt of the liabilities and the salary increase take
account of inflation, seniority, promotion and other relevant factors.
* NOTE: For the Current financial year Gratuity liability has been been
provided on estimated basis at Rs 1.50 lacs and no Actuarial valuation
has been done as required by As 15 .the management is of the opinion
that since all the plants are under suspension of work as such
provision for gratuity / leave encashment liability will not vary
substantially.
b. i) In respect of the letter of undertaking/Guarantees for Rs
2,454.61 lacs (previous Year Rs. 2,454.61 lacs) issued in favour of Dy.
Commissioner of Customs, for duty saved on account of Import of plant &
Machinery against the Import license issued under para 5.2/5.7 of exim
policy 2004-09 for lower Custom Duty under epCG Scheme against which
differential duty has been paid in the year of import. this concession
has been allowed based on the obligation that the Company will export
items up to eight times of duty saved and realize money in Convertible
Foreign exchange out of which there is due export obligation of Rs.
20,222.17 lacs over a period of 8 years from the date of issue of such
disclosure under The micro, small & medium enterprises development acT,
2006 the Company is not aware of the registration status of its
suppliers registration under the MSMe Act, 2006 ('Micro Small and
Medium enterprises Development Act 2006"). Accordingly no information
relating to outstanding balances / and interest have been disclosed as
it is not determinable. Moreover there has been no manufacturing
activities in the company for about 4 years or more as such provisions
are not applicable.
license for duty saved of Rs.2,527.80 lacs on physical import of plant
and Machinery. this has been taken as certified by the management.
ii) Apart from the above the company had imported some of the raw
material viz wire rod and Zinc valued at Rs. 42.01 crore during the
year ended 31.03.2008 against which the import duty saved was Rs. 11.83
crores. An export obligation was to be completed on or before
31.03.2010, however till date export obligation to the tune of Rs 2.57
crores of duty saved could only be completed and balance export
obligation to the tune of Rs 9.26 crores of such duty saved is still
pending. the company has approached the Regulatory Authority for
extension of time to complete the required export and if not this
liability may arise in due course for which no provision has been made.
iii) Some lenders and creditors have filed cases in different Courts.
the company has challenged the same. However the primary liability for
the same has been provided in the books except for other claims and
interest thereon.
c> liabilities that may arise due to Show cause notices received by the
Company have not been considered as Contingent liability. there are
some legal cases against the company before the different courts
initiated by some of the lenders , suppliers & others, which have not
been recognized/partly recognized in the accounts as the company has
not accepted the liability.
d> the invocation of equity shares of the company, pledged by promoter,
promoter group company and/or associates in favors of the
Banks/Financial Institution on request of the company for additional
comfort to such lenders, has resulted in an additional demand of Rs.
7,360 lacs, by the said pledgers against the company towards losses due
to invocation. the company has not recognized the same and no provision
has been made.
e> All contracts on capital account have been kept in abeyance by the
company and therefore no capital commitment is outstanding as on
balance sheet date but advances given for purpose of various projects
amounting to Rs 654.18 (lacs) {previous Year Rs 654.18 (lacs)} is
likely to become doubtful of recovery unless the material / services
are provided to the company, upon recommencement of such capital
contract. no provision for such doubtful advances have been made during
the year.
7.0 i) the working of the company has been adversely affected due to
paucity of fund and the company has not been able to service the
interest / installments of various credit facilities provided by the
lenders.
ii) As reported earlier the Company had undertaken at Kharagpur and
Durgapur new / expansion/modernization project, on which substantial
expenditure was incurred. However, due to stringencies of financial
resources and several other reasons, the Company could not continue
with those projects and the same are still pending completion.
Interests on borrowed fund together with day to day administrative
expenses on such projects have been capitalized up to 31st March 2011
and thereafter it is being charged to the statement of profit and loss
in accordance with clause 17 of AS-16 Borrowing Cost.
iii) In its Infrastructure division also, there has been slow progress
in the projects / contracts undertaken by the company from time to time
which led to termination of some of the contracts resulting in
imposition of liquidated damages & penalties, substantial
administrative expenses, invocation of bank guarantees, etc. this has
led to further loss in almost all of the contracts undertaken by the
company. However a few contracts are near completion but progressing at
slow pace.
8.0 a) the manufacturing activities at Ramsarup utpadak, Shyamnagar
has been suspended since August 2012 and physical possession has
already been taken by WBIDC as term lender.
b) one of the bankers of the Company has unlawfully taken action u/s
13(4) of SARFAeSI Act, 2002 and the balance manufacturing 3 units of
the company i.e. Ramsarup Industrial Corporation, Kalyani, Ramsarup
nirmaan Wires, Durgapur and Ramsarup lohh udyog, Kharagpur have been
taken physical possession as on 01.08.2013. the same is claimed to have
been done with the consent of some of the other bankers of the Company.
the Company has already taken appropriate legal steps challenging the
said unlawful action, before the ld Debts Recovery tribunal (II)
Kolkata.
c) IReDA has taken action u/s 13(4) of SARFAeSI Act, 2002 on one of the
units i.e., Ramsarup Vidyut ltd., Dhule and have taken physical
possession on 17.03.2015. the Company has already taken appropriate
legal steps challenging the said unlawful action before the ld. Debt
Recovery tribunal (II) Kolkata.
9. the company has incurred substantial losses and its net worth
continue to be eroded further as at the Balance sheet date. pursuant
to its accumulated losses being in excess of its net worth as per the
audited balance sheet as on 31.03.2012, the company had filed a
statutory reference with the Board for Industrial & Financial
Reconstruction (BIFR), in terms of provisions of Section 15(1) of the
Sick Industrial Companies (special provisions) Act, 1985 on 7th
November 2012. the reference of the company registered with the Hon'ble
BIFR is case no 67/2012 as intimated by letter no 3(R-4)/BC/2012 dated
21st November 2012 by the ld. Registrar of the Board for Industrial &
Financial Reconstruction. the ld BIFR had abated the application u/s
15(1) of Sick Industrial Companies Act (SICA) but the company had filed
an appeal before the Appellate Authority for Industrial & Financial
Reconstruction (AAIFR), new Delhi vide case no. 78/2014 dt 25.03.2014.
the Hon'ble AAIFR vide its order dated 03.12.2014 set aside the
impugned order and remand the matter back to BIFR with direction to
consider the submission of all the parties and pass order afresh after
giving specific findings through a reasoned order.
10. We have been informed by the management that some of the lender
banks have assigned their debts due from the company to some Assets
Reconstruction Companies. the company however is confident of raising
capital and rescheduling its debts / settlement and in the light of
continued group support. Although by the SA 570, on the various counts
indications are there about the entity's inability to continue as a
going concern but in the opinion of the management entire matter is
pending before the ld. BIFR and the Company is confident of getting
revived with the support of the Banks and financial Institutions, etc
as such the Accounts have been prepared on a going concern basis.
11. trade Receivables of Rs 54,534.60 lacs (p.Y.Rs. 54,542.65 lacs) &
some advances to suppliers under the head non Current Asset and for
Capital expenditure outstanding since long which is explained due to
prevailing adverse situation in the industries and the stoppage of
production in all the units of the company. the suppliers to whom such
advances were made are also facing financial stringency hence the delay
in realization from them. Substantial debts have become doubtful of
recovery, thereby necessitating adequate provision for the same. As the
management is taking efforts for recovery of the debts, hence no
provision for doubtful debts has been made during the year.
12. Due to suspension of manufacturing activities there are
indications which suggest impairment in the value of the fixed assets
together with Capital Work in progress of the company. the management
is still in the process of getting an impairment study done and the
financial impact of the impairment loss, if any, will be accounted for
at the relevant time. However Banker's / ARC's have been getting asset
valuation report done from time to time.
13. In the opinion of Board of Directors of the company the current
assets, loans & advances are approximately of the value as stated, if
realized in the ordinary course of business and that the provision for
all known liabilities are adequate and not in excess of the amount
reasonably necessary. there are no contingent liabilities other than
those stated above. Certain balances of sundry debtors, loans &
Advances and sundry creditors are subject
toconfirmations/reconciliation.
14. the Company has opted for tax Holiday u/S 80 IA of the Income tax
Act, 1961 in respect of its income from power generation by 3 nos. Wind
turbine Generators (WtG) for a period of 10 years from the financial
year 2005-06.
15. RELATED PARTY DISCLOSURES
Related party Disclosure in accordance with Accounting Standard 18
issued by the Institute of Chartered Accountants of India where
transaction exists: -
A . Joint Venture Company : Moira Madhujore Coal limited
name of Related parties and Description of Relationship :
B. Key Management Personnel {KMP} :
i Sri Aashish Jhunjhunwala {Managing Director}
C. Enterprises where KMP/relatives of KMP have significant influence
or control :
i Ramsarup Investments limited
ii Ramsarup Vyapaar limited
iii Madhumalati Merchandise private limited
iv Imtihan Commercial private limited
v n.R.Mercantile private ltd.
vi Vanguard Credit & Holding private limited
16. SEGMENT REPORTING
the company operates in three segments: (i) Wire & Steel products, (ii)
power Generation, (iii) Infrastructure. the company has chosen as it
primary segments considering the dominant source and nature of risks
and returns and the internal organizations and management structure. A
description of the types of products by each reportable segment is as
follows:
a. Wire & Steel products: the segment is engaged in the business of
manufacturing various kinds of wires and steel products represented by
its four units but all the manufacturing units are under suspension of
work.
B. GEOGRAPHICAL SEGMENT
the company caters mainly to the needs of Indian markets and no export
has been done during last 3 years as such there are no reportable
Geographical segments. the company has all revenues, debtors and fixed
assets in India.
17. previous Years Figures have been regrouped/reclassified wherever
consider necessary to conform to the current year's presentation.
Mar 31, 2014
1. CORPORATE INFORMATION :
The company is primarily engaged in production and distribution of Iron
& Steel, Wire Products, Pig Iron, Sponge Iron, TMT Bar, Galvanised &
Black Wires, Power Generation & Turnkey Projects contracts for various
infrastructure projects. The company presently has manufacturing
facilities at Kalyani, Shyamnagar, Durgapur & Kharagpur all in West
Bengal, of which due to unfavourable financial position is presently
not in operations except some of the contracts in Infrastructure
projects and Power generation.
2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS :
The financial statements have been prepared to comply in all material
respects with the Accounting Standard notified under Companies, 1956
read with General Circular 15/2013 dated 13th September 2013, issued by
the Ministry of Corporate Affairs, in respect of section 133 of the
Companies Act, 2013. The financial statements have been prepared under
the historical cost convention on an accrual basis.
The accounting policies have been consistent applied by the Company and
are consistent with those used in the previous year
All Assets and liabilities have been classified as current or non
current as per the Company''s normal operating cycle and other criteria
set out in the Schedule VI to the Companies Act, 1956. Based on the
nature of products and the time between the acquisition of assets for
processing and their realisation in cash and cash equivalents, the
Company has ascertained its operating cycle as 12 months for the
purpose of current & non-current classification of Assets and
liabilities.
3.1 All contracts on Capital Account has been kept in abeyance till
further development.
3.2 Capital Work in Progress includes some of the Equipment relating
to wire drawing machine amounting to Rs.1661.21 lacs which were imported
are lying at Durgapur Dry Port pending clearance of Original custom
duty of Rs.50 lacs (approx), of which actual Liability can only be
ascertained at the time of clearance.
4.1 Trade Receivables both Non-Current & Current together with
Advances to Suppliers & others are unconfirmed and some of them are
long outstanding which may be doubtful of recovery. It is estimated
that substantial debts may become doubtful of recovery for which no
provision has been made as the management is of the opinion that steps
will be taken to realize
1) All FDRs and Margin Money are stated to be held by the banks
against letter of guarantees issued by them.
2) Balance in FDR/Margin money is as certified by the management as
balances are unconfirmed by the banks.
3) Unpaid Dividend A/c includes Rs 3,31,038/- is due to be transferred
to Investor Education & Protection fund.
5.1 DISCLOSER PURSUANT TO ACCOUNTING STANDARD - 15 (REVISED)
EMPLOYEESW BENEFITS a Defined Contribution Plans
Employer- established provident fund trust are treated as defined
benefits plans. The company in its Shyamnagar unit has established a
provident fund trust namely "Nicco Steels Limited Workmen''s Provident
Fund" which is in line with Provident Fund & Miscellaneous Provision
Act, 1952.The Plan guarantees interest at the rate notified by
Provident Fund Authorities. The contribution by the Employer &
Employee together with interest accumulated thereon are payable to
employees at the time of separation from the company or retirement ,
whichever is earlier. The benefit vest immediately on rendering of the
services by the employee. But for last few years the manufacturing
activities were suspended and WBIDC has taken physical possession of
the unit since August 2012.
The guidance on implementing AS 15, Employee Benefit (Revised 2005)
issued by the Accounting Standard Board (ASB) states that Benefits
involving employer established provident funds, which require benefit
shortfalls to be compensated are to be considered in defined benefit
plans. The Actuarial Society of India has issued the final guidance for
measurement of Provided fund liabilities. As explained to us there is
no shortfall as on 31st March 2014.
During the year where PF has been deducted the company accordingly
contributes to the Regional Provided Fund Commissioner (RPFC) and the
same is recognized as expense during the year as under :
Employer''s contribution to provident fund (to the Defined Benefits
Plan) NIL NIL
Employer''s contribution to provident fund (to RPFC) 83573 NIL
b Gratuity
In Keeping with the company Gratuity scheme (Defined Benefit plan)
eligible employees are entitled to gratuity benefits (at half months
eligible salary for each completed year of service on Retirement /
Death /Termination). Vesting occurs upon completion of 5 years of
service subject to the payment of Gratuity Act, 1972. The present value
of obligation is determined based on actuarial valuation using the
projected unit credit method. Obligation for the leave encashment is
recognized in the same manner as Gratuity. Following are the further
particulars with respect to Gratuity for the year- ended 31.03.2014:
The Principal assumptions used in the calculation are the (1) Discount
Rate, (2) Salary increase. The Discount rate is based upon the market
yields available on Government Bonds at the accounting date with a term
that matches debt of the liabilities and the salary increase take
account of inflation, seniority, promotion and other relevant factors.
* During the year no Managerial remuneration has been paid to the
Managing Director. However during the previous year remuneration to
Whole time Director was paid Rs. 600,000/- within the limits prescribed
under Schedule XIII of the Companies Act, 1956.
6.0 DISCLOSURE UNDER THE MICRO, SMALL & MEDIUM ENTERPRISES DEVELOPMENT
ACT, 2006
The Company were not aware of the registration status of its suppliers
registration under the MSME Act, 2006 (''Micro Small and Medium
Enterprises Development Act 2006"). Accordingly no information relating
to outstanding balances / and inter- est have been disclosed as it is
not determinable. Moreover there has been no manufacturing activities
in the company for about 2 years or more as such provisions are not
applicable.
7.0 CONTINGENT LIABILITIES NOT PROVIDED FOR
As at As at
31.03.2014 31.03.2013
a. i) Sales Tax Liabilities
(Under Appeal) (Net of payments) 15,814.60 11,524.06
ii) Central Excise Liabilities
(Under Appeal) 1,557.56 1,557.62
iii) Service Tax Liabilities 4,519.87 4,519.87
iv) Guarantees given by the bank &
counter Guarantee of the company 368.27 2,172.89
Note : Margin held by banks by way
of pledge of FDRs & on margin account 188.73 362.41
b. i) In respect of the Letter of Undertaking/Guarantees for Rs
2,454.61 Lacs (Previous Year Rs. 2,454.61 Lacs) issued in favour of Dy.
Commissioner of Customs, for duty saved on account of Import of Plant &
Machinery against the Import License issued under Para 5.2/5.7 of Exim
Policy 2004-09 for lower Custom Duty under EPCG Scheme against which
differential duty has been paid in the year of import. This concession
has been allowed based on the obligation that the Company will export
items upto eight times of duty saved and realize money in Convertible
Foreign Exchange out of which there is due export obligation of Rs.
20,222.17 Lacs over a period of 8 years from the date of issue of such
license for duty saved of Rs.2,527.80 lacs on physical import of Plant
and Machinery. This has been taken as certified by the management.
ii) Apart from the above the company had imported some of the raw
material viz wire rod and Zinc valued at Rs. 42.01 crore during the
year ended 31.03.2008 against which the import duty saved was
Rs. 11.83 crores. An ex- port obligation was to be completed on or
before 31.03.2010, however till date export obligation to the tune of
Rs 2.57 crores of duty saved could only be completed and balance
export obligation to the tune of Rs 9.26 crores of such duty saved is
still pending. The company has approached the Regulatory Authority for extension of time to complete the required export and if not this
liability may arise in due course for which no provision has been
made.
c. Liabilities that may arise due to Show cause notices received by the
Company have not been considered as Contingent Liability. There are
some legal cases pending against the company, even for liquidations for
claiming their dues before the Hon''ble Calcutta High Court initiated by
some of the lenders, suppliers & others, which have not been
recognised/ partly recognised in the accounts as the company has not
accepted the liability. However the entire matter is pending before the
Hon''ble BIFR/AAIFR.
d. The invocation of equity shares of the company, pledged by promoter,
promoter group company and/or associates in favour of the
Banks/Financial Institution on request of the company for additional
comfort to such lenders, has resulted in an additional demand of Rs.
7,360 lacs, by the said pledgers against the company towards losses due
to invocation. The company has not recogonised the same and no
provision has been made.
e. All contracts on capital account have been kept in abeyance by the
company and therefore no capital commitment is outstanding as on
balance sheet date but advances given for purpose of various projects
amounting to Rs 654.18 (Lacs) {Previous Year Rs 654.23 (Lacs)} is
likely to become doubtful of recovery unless the material / services
are provided to the company, upon recommencement of such capital
contract. No provision for such doubtful advances have been made during
the year.
34.0 i) During the year for, the working of the company has been
adversely affected due to paucity of fund and the company
has not been able to service the interest / installments of various
credit facilities provided by the lenders. Some of the guarantees in
favour of the suppliers and or performance guarantees issued by the
banks have been invoked which could not be serviced hence, had to be
written off under the head Finance Cost by creating the liability in
favour of the bank.
ii) As reported earlier the Company had undertaken at Kharagpur and
Durgapur new / expansion/modernization project, on which substantial
expenditure was incurred. However, due to stringencies of financial
resources and several other reasons, the Company could not continue
with those projects and the same are still pending completion.
Interests on borrowed fund together with day to day administrative
expenses on such projects have been capitalized upto 31st March 2011
and thereafter it is being charged to the statement of Profit and Loss
in accordance with clause 17 of AS-16 Borrowing Cost.
iii) In its Infrastructure division also, there has been slow progress
in the projects / contracts undertaken by the company from time to time
which led to termination of some of the contracts resulting in
imposition of liquidated damages & penalties, substantial
administrative expenses, invocation of bank guarantees, etc. This has
led to further loss in almost all of the contracts undertaken by the
company. However a few contracts are near completion but progressing at
slow pace.
8.0 a) The manufacturing activities at Ramsarup Utpadak, Shyamnagar
has been suspended since August 2012 and physical possession has
already been taken by WBIDC as term lender.
b) One of the bankers of the Company has taken action u/s 13(4) of
SARFAESI Act, 2002 and the balance manufacturing Three(3) units of the
company i.e. Ramsarup Industrial Corporation, Kalyani, Ramsarup Nirmaan
Wires, Durgapur and Ramsarup Lohh Udyog, Kharagpur have been taken
legal possession on 01.08.2013. The same is claimed to have been done
with the consent of some of the other bankers of the Company. The
Company has already taken appropriate legal steps challenging the said
unlawful action, before the Ld. Debts Recovery Tribunal (II) Kolkata.
8.1 The company has incurred substantial losses and its Net worth
continue to be eroded further as at the Balance sheet date. Pursuant
to its accumulated losses being in excess of its networth as per the
audited balance sheet as on 31.03.2012, the company had filed a
statutory reference with The Hon''ble Board for Industrial & Financial
Reconstruction (BIFR), in terms of proviso of Section 15(1) of the Sick
Industrial Companies (special provisions) Act, 1985 on 7th November
2012. The reference of the company registered with the Hon''ble BIFR is
case no 67/2012 as intimated by letter No 3(R-4)/BC/2012 dated 21st
November 2012 by the Ld. Registrar of the Board for Industrial &
Financial Reconstruction. The Hon''ble BIFR has since abated the
application u/s 15(1) of Sick Industrial Companies Act (SICA) but the
company has filed an appeal before The Hon''ble Appellate Authority for
Industrial & Financial Reconstruction (AAIFR), New Delhi vide case no.
78/2014 Dt 25.03.2014 which is still pending.
8.2 We have been informed by the management that some of the Lender
banks that they have assigned their debts due from the company to some
Assests Reconstruction Companies .The company however is confident of
raising capital and resched- uling its debts/ settlement and in the
light of continued group support, the Financial Statements have been
prepared on a going concern basis.
9.0 Trade Receivables of Rs 54,542.65 Lacs (P.Y.Rs.53152.52 lacs) &
some advances to suppliers under the head Non Current Asset outstanding
for a period of more than one year is due to prevailing adverse
situation and the stoppage of production in all the units of the
company. The suppliers to whom such advances were made are also facing
financial stringencies hence the delay in realization from them.
Substantial debts have become doubtful of recovery, thereby
necessitating ade- quate provision for the same. However, the
management is making efforts of recovery of the debts, hence no
provision for doubtful debts has been made during the year.
10.0 Due to suspension of manufacturing activities there are
indications which suggest impairment in the value of the fixed assets,
being plant and machinery and other fixed assets of the company. The
management is still in the process of getting an impairment study done
and the financial impact of the impairment loss, if any, will be
accounted for at the relevant time.
11.0 In the opinion of Board of Directors of the company the current
assets, Loans & advances are approximately of the value as stated, if
realised in the ordinary course of business and that the provision for
all known liabilities are adequate and not in excess of the amount
reasonably necessary. There are no contingent liabilities other than
those stated above. Certain balances of sundry debtors, Loans &
Advances and sundry creditors are subject to
confirmations/reconciliation.
12.0 The Company has opted for Tax Holiday U/S 80 IA of the Income Tax
Act, 1961 in respect of its income from power gener- ation by 3 Nos.
Wind Turbine Generators (WTG) for a period of 10 years from the
financial year 2005-06.
13.0 RELATED PARTY DISCLOSURES
Related Party Disclosure in accordance with Accounting Standard 18
issued by the Institute of Chartered Accountants of India where
transaction exists : -
A . Joint Venture Company : Moira Madhujore Coal Limited Name of
Related Parties and Description of Relationship :
B. Key Management Personnel {KMP} :
i Sri Aashish Jhunjhunwala {Managing Director}
C. Relatives of KMP :
i Smt. Sharda Devi {Mother of M.D}
ii Smt. Neerza Jhunjhunwala {Wife of M.D}
D Enterprises where KMP/relatives of KMP have significant influence or
control :
i Ramsarup Investment Limited
ii Ramsarup Vyapaar Limited
iii Madhumalati Merchandise Private Limited
iv Imtihan Commercial Private Limited
v N.R.Mercantile Private Ltd.
vi Vanguard Credit & Holding Private Limited.
E Employees'' Benefit Plans where there is control :
i Ramsarup Industrial Corporation Employee''s Gratuity Fund
ii Ramsarup Utpadak Unit II Employees Gratuity Fund
iii Nicco Steels Limited Workmens'' Provident Fund
The company operates in three segments : (i) Wire and steel products
(ii) Power Generation and (III
Infrastructure. The company has chosen business segments as its primary
segments considering the dominant source and nature of risks and
returns and the internal organizations and management structure. A
description of the types of products by each reportable segment is as
follows :
a. Wire and Steel products : The segment is engaged in the business of
manufacturing various kinds of wires and steel products represented by
its 4 manufacturing units.
b. Power generation : The company owns Wind turbine generator at
Maharashtra and the power generated is sold to MESB as per agreement.
c Infrastructure : Under this segment the company procures orders for
the various infrastructure projects at different places and after
completion the same is handed over.
Mar 31, 2013
1.1 DISCLOSURE PURSUANT TO ACCOUNTING STANDARD -15 (REVISED)
''EMPLOYEES BENEFITS'':
a Defined Contribution Plans
"Employer- established provident fund trust are treated as defined
benefits plans. The company in its Shyamnagar unit has established a
provident fund trust namely ""Nicco Steels Limited Workmen''s Provident
Fund"" which is in line with Provident Fund & Miscellaneous Provision
Act, 1952,The Plan guarantees interest at the rate notified by
Provident Fund Authorities . The contribution by the Employer &
Employee together with interest accumulated thereon are payable to
employees at the time of separation from the company or retirement,
whichever is earlier. The benefit vest immediately on rendering of the
services by the employee.
The Guidance on Implementing AS 15 , Employee Benefit (Revised 2005)
issued by the Accounting standard Board (ASB) states that benefits
involving employer established provident funds, which require interest
benefit shortfalls to be compensated are to be considered as defined
benefit plans. The Actuarial Society of India has issued the final
guidance for measurement of provident fund liabilities. Their is no
shortfall as on 31st March 2013.
b Gratuity
"In Keeping with the company Gratuity scheme (Defined Benefit plan)
eligible employees are entitled to gratuity benefits (at half months
eligible salary for each completed year of service on Retirement /
Death /Termination). Vesting occurs upon completion of 5 years of
service subject to the payment of Gratuity Act, 1972. The present value
of obligation is determined based on actuarial valuation using the
projected unit credit method. Obligation for the leave encashment is
recognized in the same manner as Gratuity. Following are the further
particulars with respect to Gratuity for the year-ended 31.03.2013 :
The Principal assumptions used in the calculation are the (1) Discount
Rate, (2) Salary increase. The Discount rate is based upon the market
yields available on Government Bonds at the accounting date with a term
that matches debt of the liabilities and the salary increase take
account of inflation, seniority, promotion and other relevant factors.
2.0 CONTINGENT LIABILITIES NOT PROVIDED FOR:
31.03.2013 31.03.2012
(Rs in Lacs) (Rs in Lacs)
a. i) Sales Tax Liabilities
(Under Appeal) (Net of payments) 11,524.06 11,423.83
ii) Central Excise Liabilities
(Under Appeal) 1,557.62 1,557.62
iii) Guarantees given by the
bank & counter Guarantee of the
company. 2,172.89 2,327.02
Note : - Margin held by banks by
way of pledge of FDRs & on margin
account 362.41 409.34
b. i) In respect of the Letter of Undertaking/Guarantees for Rs
2,454.61 Lacs (Previous Year Rs. 2,454.61 Lacs) issued in favour of Dy.
Commissioner of Customs, for duty saved on account of Import of Plant &
Machinery against the Import License issued under Para 5.2£.7 of Exim
Policy 2004-09 for lower Custom Duty under EPCG Scheme against which
differential duty has been paid in the year of import. This concession
has been allowed based on the obligation that the Company will export
items upto eight times of duty saved and realize money in Convertible
Foreign Exchange out of which there is due export obligation of Rs.
20,222.17 Lacs over a period of 8 years from the date of issue of such
license for duty saved of Rs.2,527.80 lacs on physical import of Plant
and Machinery. This has been taken as certified by the management.
ii) Apart from the above the company had imported some of the raw
material viz wire rod and Zinc valued at Rs. 42.01 crore during the
year ended 31.03.2008 against which the import duty saved was Rs. 11.83
crores. An export obligation was to be completed on or before
31.03.2010, however till date export obligation to the tune of Rs 2.57
crores of duty saved could only be completed and balance export
obligation to the tune of Rs 9.26 crores of such duty saved is still
pending. The company has approached the Regulatory Authority for
extension of time to complete the required export and if not this
liability may arise in due course for which no provision has been made.
Had the impact of provision being considered, loss for the year would
have increased by Rs 9.26 Crore as against the reported loss in the
Statement of Profit & Loss .
c. Liabilities that may arise out of Show cause notices received by
the Company have not been considered as Contingent Liability. There are
some legal cases pending against the company, before the Hon''ble
Calcutta High Court initiated by some of the lenders, suppliers &
others, which have not been recognized/partly recognized in the
accounts as the company has not accepted the liability as the same is
being contested and after decision of the Hon''ble High Court the same
will be accounted for in the books of account.
d. The invocation of equity shares of the company, pledged by
promoter, promoter group company and/or associates in favour of the
Banks/Financial Institution on request of the company for additional
comfort to such lenders, has resulted in an additional demand of Rs.
7,360 lacs, by the said pledges against the company towards losses due
to invocation. The company has not recognized the same and no
provision has been made.
e. All contracts on capital account have presently been kept in
abeyance and therefore no capital commitment is outstanding as on
balance sheet date but advances given for purpose of various projects
amounting to Rs 654.23 (Lacs){Previous Year Rs 903.50 (Lacs)} is likely
to become doubtful of recovery unless the material / services are
provided to the company, upon recommencement of such capital contract.
No provision for such doubtful advances have been made during the year.
3.0 i) During the year also, the working of the company has been
adversely affected due to paucity of fund and the company has not been
able to service the interest / installments of various credit
facilities provided by the lenders.
ii) The Company had undertaken at Kharagpur and Durgapur new /
expansion/modernization project, on which substantial expenditure was
incurred. However, due to stringencies of financial resources and
several other reasons, the Company could not continue with those
projects and the same are still pending completion. Interests on
borrowed fund together with day to day administrative expenses on such
projects have been capitalized up to 31st March 2011 and thereafter it
has been charged to the statement of Profit and Loss for the year in
accordance with clause 17 of AS-16 Borrowing Cost". Due to financial
crisis, the company continued suspension of the said activity and in
view of the prevailing adverse financial position of the company, the
management does not for see commencement of the above activity in the
immediate near future.
iii) In its Infrastructure division also, there has been slow progress
in the projects / contracts undertaken by the company from time to time
which led to termination of some of the contracts resulting in
imposition of liquidated damages & penalties, substantial
administrative expenses, invocation of bank guarantees, etc. This has
led to further loss in most of the contracts undertaken by the company.
However some of the contracts are near completion but progressing at
slow pace.
4.0 The company has incurred substantial losses and its Net worth
continues to be negative as at the Balance sheet date. Pursuant to its
accumulated losses being in excess of its networth as per the audited
balance sheet as on 31.03.2012, the company had filed a statutory
reference with the Board for Industrial & Financial Reconstruction, in
terms of provisions of Section 15(1) of the Sick Industrial Companies
(special provisions) Act, 1985 on 7th November 2012. The reference of
the company registered with the Hon''ble BIFR as case no 67/2012 as
intimated by letter No 3(R-4)/BC/2012 dated 21st November 2012 by the
Ld. Registrar of the Board for Industrial & Financial Reconstruction.
Since the company is confident of raising capital and rescheduling its
debts / settlement and in the light of continued group support, the
financial statements have been prepared on a going concern basis.
5.0 Trade Receivables of Rs 53152.52 Lacs (P.Y. Rs. 15987 lacs) & some
advances to suppliers under the head Non Current Asset outstanding for
a period of more than one year is due to prevailing adverse situation
and the stoppage of production in some of the units of the company. The
suppliers to whom su''ch advances were made are also facing financial
stringence hence the delay in realization from them. Substantial debts
have become doubtful of recovery, thereby necessitating adequate
provision for the same. However, the management is making efforts of
recovery of the debts, hence no provision for doubtful debts has been
made during the year.
6.0 Due to suspension of manufacturing activities there are
indications which suggest impairment in the value of the fixed assets,
being plant and machinery and other fixed assets of the company. The
management is in the process of getting an impairment study done and
the financial impact of the impairment loss, if any, will be accounted
for at the material time, when the impairment study will be completed.
7.0 In the opinion of Board of Directors of the company the current
assets. Loans & advances are approximately of the value as stated, if
realised in the ordinary course of business and that the provision for
all known liabilities are adequate and not in excess of the amount
reasonably necessary. There are no contingent liabilities other than
those stated above. Certain balances of sundry debtors, Loans &
Advances and sundry creditors are subject to confirmations/
reconciliation.
8.0 The Company has opted for Tax Holiday U/S 80 IA of the Income Tax
Act, 1961 in respect of its income from power generation by 3 Nos. Wind
Turbine Generators (WTG) for a period of 10 years from the financial
year 2005-06.
9.0 RELATED PARTY DISCLOSURES
Related Party Disclosure in accordance with Accounting Standard 18
issued by the Institute of Chartered Accountants of India where
transaction exists : -
A Joint Venture Company:
Moira Madhujore Coal Limited
Name of Related Parties and Description of Relationship :
B Key Management Personnel {KMP}:
i. Sri Aashish Jhunjhunwala {Managing Director) ''
ii. Aashish Jhunjhunwala {HUF}
C Relatives of KMP :
i. Smt. Sharda Devi {Mother of M.D}
ii. Smt. Neerza Jhunjhunwala {Wife of M.D)
iii. Sri Advay Jhunjhunwala {Son of M.D)
D Enterprises where KMP/relatives of KMP have significant influence or
control:
i. Ramsarup Investments Limited
ii. Ramsarup Projects Private Limited
iii. Ramsarup Vyapaar Limited
iv. Madhumalati Merchandise Private Limited
v. Imtihan Commercial Private Limited
vi. N.R.Mercantile Private Ltd.
vii. Naresh Engineers Ltd.
viii. Vanguard Credit & Holding Private Limited
ix. Amanat Merchants Private Limited
x. Greentop Realters Private Limited
xi. Laddugopal Propreties Private Limited
E Employees'' Benefit Plans where there is control:
i. Ramsarup Industrial Corporation Employee''s Gratuity Fund
ii. Ramsarup Utpadak Unit II Employees Gratuity Fund
iii. Nicco Steels Limited Worksmen Provident Fund
10.0 Previous Years Figures have been regrouped/reclassified wherever
necessary to conform to the current year''s presentation.
Mar 31, 2011
1. PREFERENCE SHARE CAPITAL :
a. 13,00,000 5% Redeemable Cumulative Preference Share of Rs.10/- each
fully paid up were allotted on 3 I -03-2003. which is due for
redemption at any time between 6th and 10th year from the date of
allotment at a premium of Rs.25/-per share.
b. 3 1,60,000 4% Redeemable Cumulative Preference Share of Rs.10/-
each fully paid up were allotted on 24-09-2004. which is due for
redemption at any time between 7th and 8th year from the date of
allotment at a premium of Rs.25/- per share.
c. 2,24,99,920 5% Redeemable Non Cumulative Preference Share of Rs
10/- each fully paid up were allotted on 3 I - 03-20 10, which is
redeemable at a premium of Rs.90/- per share at any time with in 20th
year from the date of allotment.
The Preference shares as stated in (a) & (b) above is due for
redemption on or before 3 1.03.2013 and 30.09.2012 respectively but in
view of the unfavorable financial position, the company has not been
able to plan source of redemption and also has not provided for the
premium on redemption in the financial statements.
2. SECURED LOANS :
i) Term Loans and Funded Interest Term Loans :
a. Term Loans from IDBI Bank Limited is secured by equitable mortgage
of lease hold land and First charge on certain Fixed Assets of the
company's Kalyani unit on pari-passu basis with the other lenders and
personal guarantee of Managing Director together with corporate
guarantee of M/s.Ramsarup Investments Ltd and Pledge 3507848 equity
shares of Company held by related Body Corporate. The Banker has
invoked entire equity shares of the company pledged with them during
the year and has adjusted the money against their overdoes in part.
b. Term Loan from ICICI Bank Ltd. is secured by way of first equitable
mortgage of all immovable properties and hypothecations of moveable
assets other than book debts, stock of raw material, finished, semi
finished goods of the Shyamnagar unit ranking Pari-Passu with other
term lenders & guaranteed by Managing Director of the Company. The term
loan is further secured by pledge of 5,00,000 equity shares of the
company held by promoters which has been further supplemented by
another 5,37,970 equity shares of the company for further financing
creed* facilities. The Term Loan is repayable in 30 quarterly
installments commencing from June, 2013.
c. Term Loan from WBIDC Ltd is secured by way of 1st equitable
mortgage of immoveable property and hypothecation of all movable assets
pertaining to Shyamnagar unit ranking Pari-Passu with other term
lenders and personal guarantee of the Managing Director of the company.
Repayable with one year Rs.375 lacs (previous year Rs.1 50 lacs).
d. Rupee Term Loan from Punjab National Bank is secured by way of
hypothecation of factory shed & building, Plant & Machineries and other
fixed assets of Durgapur Unit and also equitable mortgage of the land
and factory shed belonging to Vanguard Credit & Holding Pvt Ltd on
pari-passu basis with other term lenders along with its corporate
guarantee and personal guarantee of Managing Director of the company.
The loan is repayable in 24 equal quarterly installments of Rs.300 Lacs
each commencing from 1st April 201 I, Repayable within next one year Rs
1200 Lacs (Previous year.NIL).
e. Rupee term loan from Axis bank Ltd. is secured by way of
hypothecation of factory shed & building, Plant & Machineries and other
fixed assets of Durgapur Unit and also equitable mortgage of the
factory shed & land belonging to Vanguard Credit & Holding Pvt. Ltd. on
pari-passu basis with other term lenders along with its corporate
guarantee and personal guarantee of Managing Director of the company.
The loan of Rs.4,500 Lacs is repayable in 20 equal quarterly
installments commencing from April 2010 and Rs.5,000 Lacs in 14 equal
quarterly installments commencing from April 2012 but due installments
could not be paid and the loan has become overdue for payment.
f Loan from Axis Bank of Rs.5000 lacs is repayable in full (pervious
year Rs.5000/-) and has become overdue.
g. Term loans for various modules of Integrated Steel project at
Kharagpur have been tied up under multiple banking arrangements and
secured by way of equitable mortgage of entire land including Building
thereon on pari passu basis. The Lender Banks are having 1st charge on
movable fixed assets of the specific module of the project on pari
passu basis with other term lenders of specific modules and 2nd pari
passu charge on the said assets on a reciprocal basis and further
secured by personal guarantee of the Managing Director of the Company
and some of the body corporate. Since neither installment due for
repayment nor interest has been serviced as such all the accounts have
become overdue to that extent. However interest due thereon has been
provided at the specified rates of interest as per available terms /
sanctions.
h. Rupee Term Loan of Rs.35 185 Lacs are secured by subservient charge
on fixed assets of Kharagpur unit and were due for payment but the same
has become overdue.
g) Term Loan from IREDA is secured by First charge by way of the
mortgage on all immovable properties & hypothecation of movable assets/
properties both existing and future pertaining to 3.75 MW Wind Farm
Project at Village Khori, Taluka Sakri, District Dhule, in the State of
Maharastra (Project No. 1726) and elsewhere excluding specified
movables to be charged to bankers for Working Capital Borrowings as
agreed by IREDA. The Loan was Repayable in 24 equal quarterly
installments of Rs.52 Lacs commenced from 3 1st March 2006 but last 6
quarterly installments w.e.f. 3rd quarter 2009 up to 4th quarter 2010-1 I
have become overdue together with interest & liquidated damages.
Repayable in next one year entire amount of Rs.468 lacs (pervious year
Rs.3 12 lacs)
j. Working Capital Term Loan (WCTL) and Funded Interest Term Loan
(FITL) were to be repaid in quarterly installments but the same have not
been paid and became overdue.
k. Buyers Credit from Bank are secured by earmarking term loan
facilities from banks.
ii) Short Term / Working Capital Facilities :
a. Working Capital facilities from banks for Kalyani unit are secured
by hypothecation of stock of raw materials. finished goods, stock in
process, stores & spares etc. and book debts and personal guarantee of
Managing Director of the Company and a corporate guarantee of Ramsarup
Investments Ltd and collaterally secured byway of equitable mortgage on
leasehold Land and Building thereon at Kalyani on Pari-Passu basis with
the Consortium of Banks and IDBI Bank Limited and 2nd Charge on Fixed
Assets financed by IDBI Bank Limited.
b. Working Capital facilities from United Bank of India are secured by
hypothecation of stock of raw materials. finished goods, stock in
process, stores & spares etc. and book debts and second charge on its
Fixed Assets at Shyamnagar and personal guarantee of Managing Director
of the Company together with corporate guarantee of M/s. Ramsarup
Investments Limited.
c. Working Capital Facilities from Punjab National Bank and IDBI Bank
Ltd are secured on pari-passu basis by hypothecation of entire stocks,
stock in process, finished goods, stores & spares, stocks-in-transit,
stock lying with others for conversion and book debts of Durgapur Unit
of the company.
d. Working Capital facilities from Punjab National Bank for the Mini
Blast Furnace at Kharagpur is secured by Hypothecation of entire stock
and book debts of the unit and personal guarantee of the Managing
Director and corporate Guarantee of Four other promoter group companies
and collaterally secured by way of 3rc charge on Plant & Machinery of
the unit on pari passu basis with the charges created and/or to be
create by the company in favor of the other working capital lenders.
e. Working capital facility from Banks for some of its Turnkey
Projects are secured by Hypothecation of stock. book debts & other
current assets and personal guarantee of the Managing Director of the
company, and second charge on the Fixed assets of Infrastructure Unit
on Pari-Passu basis. Cash Credit facilities provided by Development
Credit Bank Ltd has become overdue due to non servicing of monthly
interest payable to them.
f Letter of Guarantee issued by certain banks are secured by way of
first pari-passu charge as applicable on inventories, book debts and
other movable assets.
g. Various Term Loans and Cash Credit facilities granted by bankers as
per Secured Loan (schedule 2) and referred to above has become overdue
and are presently inoperative. However interest have been provided on
all these accounts at the respective rates of sanction.
3. UNSECURED LOAN :
Some of the Unsecured Loans from Body Corporate/s are not bearing
interest.
4. DEFERRED TAX:
The break up of major components of net Deferred Tax Liabilities
/(Assets) as on 3 I -03-201 I is as under :
During the year Deferred Tax liability has been converted into Deferred
Tax Assets as above , mainly due to accumulated business loss and
unabsorbed depreciation and other items as computed in accordance with
the provisions of Income Tax Act 196 I but in absence of convincing
evidence and virtual certainty for realisation of such "deferred tax
assets", against future taxable income and in view of the prudent
accounting policies , deferred tax asset has not been recognised.
5. The Company had promoted a Subsidiary Company in the name of
Ramsarup Energy Limited (REL) by agreeing to subscribe 49,000 Equity
Shares of Rs.10/- each equivalent to 98% of Equity Share Capital of
REL REL was incorporated on 09-02-2010 with one of its main object of
carrying on the business of generation and distribution of electricity.
A, the object envisaged was not pursued the company applied for
cancellation of its registration as permitted by Companies Act, 1956 In
view of this provision of various disclosures for subsidiary company is
not applicable.
6. DISCLOSURE UNDER THE MICRO, SMALL & MEDIUM ENTERPRISES DEVELOPMENT
ACT, 2006 :
There are no Micro, Small and Medium Enterprises as defined in Micro,
Small & Medium Enterprises Development Act, 2006 to whom the Company
owes dues on account of Principle amount together with Interest and
accordingly no addition or disclosure has been made.
The above information regarding Micro, Medium and Small Enterprises has
been determined to the extent such party have been identified on the
basis of information available with the company and has been relied
upon by the Auditors'.
7. Inventories include stock lying with outsiders : Rs.2,04,345/- (As
certified by the Management) (NIL)
8. CAPITAL COMMITMENTS :
All contracts on capital account has presently been kept in abeyance
till further development.
Carried over to Capital Work-in-Progress (Schedule-6) | 262,314,584.84
1220,178,096.62
9. Interest on borrowed fund on the incomplete project for the period
beyond stipulated date of commissioning of the project has been
included in Capful Work in Progress.
10. CONTINGENT LIABILITIES NOT PROVIDED FOR :
Sales Tax Liableness (Under Appeal) Rs.9,671.83 Lacs
(Net of payments) (Rs.5,955.10 Lacs)
b. Bank Guarantees Rs.3,064.23 Lacs (Rs.6,173.19 Lacs)
Note : Margin held by banks by way of pledge of Rs.3 19.76 Lacs
FDRs for L/C&L/G (Rs.2,344.87 Lacs)
c. In respect of the Letter of Undertaking/Guarantees for Rs2454.6 I
Lacs (Previous Year Rs.2454.61 Lacs) issued is favor of Dee.
Commissioner of Customs, for duty saved on account of Import of Plant &
Machinery against the Import License issued under Para 5.2/5.7 of Exam
Policy 2004-09 for lower Custom Duty under EPCG Scheme against which
differential duty has been paid in the year of import. This concession
has been allowed based on the obligation that the Company will export
items up to eight times of duty saved and realize money in Convertible
Foreign Exchange out of which there is due export obligation of Rs.
20222.17 Lacs over a period of 8 years from the date of issue of such
license for duty saved of Rs.2527.80 lacs on physical import of Plant
and Machinery. This has been taken as certified by the management.
Apart from the above the company had imported some of the raw material
viz wire rod and Zinc valued at Rs.42.01 crore during the year ended 3
1.03.2008 against which the import duty saved was Rs.11.83 crores. An
export obligation was to be completed on or before 3 1.03.2010, however
till date export obligation to the tune of Rs.2.57 crores of duty saved
could only be completed and balance export obligation to the tune of Rs
9.26 corers of such duty saved is still pending. The company has
approached the regulatory authentic for extension of time to complete
the required export and if not this liability may arise in due course
for which no provision has been made. Had the impact of provision been
considered, the loss before tax for the year would have increased by
Rs.9.26 crores as against the reported loss as per profits loss
account.
d. Show cause notices received by the Company has not been considered
as Contingent Liability
e. The invocation of equity shares of the company pledged by promoter
/ promoter company / associates and others on request of the company
for additional comfort to the banks and / or other lenders has resulted
in a demand of Rs.7360 lacs by the said pledges during the year on
the company for which no provision has been made.
11. Dividend on Cumulative Preference Shares amounting to Rs 57.42
Lacs for three years ended 31st March 201 I has not been provided for.
12. In the opinion of Board of Directors of the company the current
assets, Loans & advances are approximately of the value as stated, if
realised in the ordinary course of business.
13. The provision for all known liabilities are adequate and not in
excess of the amount reasonably necessary. There are no contingent
liabilities other than those stated above. Certain balances of sundry
debtors, advances and sundry creditors are subject to
confirmations/reconciliation.
14. Construction Expenses include transfer of material from / to other
units Rs.1 6.99 lacs (Rs.443. lacs) and Nil (Rs.1,10.29 lacs)
respectively.
15. The Company has opted for Tax Holiday U/S 80 IA of the Income Tax
Act, 196 I in respect of its income from power generation by 3 Nos.
Wind Turbine Generators (WTG) for a period of 10 years from the
financial year 2005-06.
16. The company is following the system of recognising CENVAT Service
Tax, Education Cess, Service Tax Receivable, VAT etc through receivable
/ payable in Balance Sheet.
17. Excise Duty on increase / decrease in stock represents
differential Excise Duty on Opening and Closing stock of Finishes
Goods.
18. A sum of Rs.36.1 6 lakhs have been determined payable for
maintenance of WTG for earlier years after deducting claim for low
generation of power etc. and has been provided in full during the year
in addition to maintenance charges for the year.
19. MANAGERIAL REMUNERATION :
Remuneration paid to the Managing Director and Whole time Director
amounts to Rs.18,00,000/- and Rs.6,00,000/- respectively which is
well within the limits prescribed under Schedule XIII of the Companies
Act, 1956. Hence computation of net profit for the purpose of Directors
remuneration under section 349 of the Companies Act 1956 has not been
enumerated.
20. DISCLOSURE PURSUANT TO ACCOUNTING STANDARD- 15 (REVISED)'EMPLOYEES
BENEFITS' :
a. Defined Contribution Plans
In accordance with the Accounting Standard I 5 on employee benefits
issued by the Institute Chartered Accountants of India, employer-
established provident fund trust are treated as defined benefits plans.
The company in its Shyamnagar unit has established a provident fund
trust which is exempted U/S 17 of Employees Provident Fund Act, 1952
which stipulates that the employer shall make good deficiency if any,
in the interest rate declared by trust vis-a-vis statutory rate. For
all other units the company contributes to the Regional Provident Fund
Commissioner (RPFC) and recognizee as expense for the year as under:
b. Defined Benefit Plans
In Keeping with the company Gratify scheme (Defined Benefit plan)
eligible employee are entitled to gratuity benefits (at half months
eligible salary for each completed year of service on Retirement /
Death Termination). Vesting occurs upon competition of 5 years of
service subject to the payment of Gratuity Act, 1972. The present value
of obligation,s determined based on actuarial valuation using the
projected un* creed* method. Obligation for the leave encashment ,s
recognized in the same manner as Gratuity. Following are the further
particulars with respect to Gratuity for the year- ended 3 1.03.2011:
The Principal assumptions used in the calculation are the (I) Discount
Rate, (2) Salary increase. The Discount rate is based upon the market
yields available on Government Bonds at the accounting date with a term
that matches debt of the liabilities and the salary increase take
account of inflation, seniority, promotion and other relevant factors.
21. RELATED PARTY DISCLOSURES :
Related Party Disclosure in accordance wit Accounting Standard I 8
issued by the Institute of Chartered Accountants of India
a. Joint Venture Company:
Moira Madhujore Coal Limited
22. ADDITIONAL INFORMATION PURSUANT TO THE PROVISIONS OF PARAGRAPH 3,
4C AND 4D OF PART II OF THE SCHEDULE VI OF THE COMPANIES ACT, 1956 :
Geographical Segment
The Company caters mainly to the needs of Indian Market and the export
Turnover being 0.8 I % (Previous Year 5.88 %) of the total turnover of
the company there are no reportable geographical segments.
The Accounting policies adopted for segment reporting are in line with
the accounting policies of the company Revenue & Expense have been
identified to segment on the basis of the relationship to the operating
activities of the segment but Revenue & Expense which relate to the
interpose as a whole , and not allocable to segments on a reasonable
basis, have been shown under the head "Unallowable"
23. The previous year figures had been regrouped, rearranged and
reclassified wherever considered necessary Signatures to Schedule
1 to 22 to Balance Sheet as at 31st March, 2011 and Profit & Loss
Account for the year ended on that date
Mar 31, 2010
1. PREFERENCE SHARE CAPITAL
a. 13,00,000 5% Redeemable Cumulative Preference Share of Rs 10/- each
fully paid up were allotted on 31-03-2003, which is due for redemption
at any time between 6th and 10th year from the date of allotment at a
premium of Rs 25/- per share.
b. 31,60,000 4% Redeemable Cumulative Preference Share of Rs 10/- each
fully paid up were allotted on 24-09-2004, which is due for redemption
at any time between 7th and 8th year from the date of allotment at a
premium of Rs 25/- per share.
c. The Company has allotted during the year 2,24,99,920 5% Redeemable
Non Cumulative Preference Share of Rs 10/- each fully paid up on
31-03-2010, which is redeemable at a premium of Rs 90/- per share at
any time with in 20th year from the date of allotment.
2. SECURED LOANS i) Long Term
a. Rupee Term Loan from IDBI Bank Limited is secured by equitable
mortgage of lease hold land and First charge on certain Fixed Assets of
the companys Kalyani unit on pari-passu basis with the other lenders
and personal guarantee of Managing Director together with corporate
guarantee of M/s. Ramsarup Investments Ltd and Pledge of part of
CompanyÃs Equity Shares held by other related Body Corporates. The
loan is repayable in 20 quarterly instalments commencing from April
2011. Repayable within next one year NIL (Previous year NIL).
b. Term Loan from ICICI Bank Ltd. is secured by way of first equitable
mortgage of all immovable properties and hypothecations of movable
assets other than book debts, stock of raw material, finished, semi
finished goods of the Shyamnagar unit ranking Pari-Passu with other
term lenders & guaranteed by Managing Director of the Company. The Term
Loan is repayable in 60 Monthly instalments of Rs 13.75 Lacs each
commenced from December 2005. Repayable within next one year is Rs. 124
Lacs (Previous year Rs. 165 Lacs).
c. The Term Loan from WBIDC Ltd secured by way of 1st equitable
mortgage of immovable property and hypothecation of all movable assets
pertaining to Shyamnagar unit ranking Pari-Passu with other term
lenders and personal guarantee of the Managing Director of the company.
Repayable within next one year is Rs 150 Lacs (Previous year NIL).
d. Rupee Term Loan from Punjab National Bank is secured by way of
hypothecation of factory shed & building, Plant & Machineries and other
fixed assets of Durgapur Unit and also equitable mortgage of the
factory shed & land belonging to Vanguard Credit & Holding Pvt Ltd on
pari passu basis with other term lenders along with its corporate
guarantee and personal guarantee of Managing Director of the company.
The loan is repayable in 24 equal quarterly instalments of Rs. 300 Lacs
commencing from 1st April 2011, Repayable within next one year NIL
(Previous year Rs. NIL).
e. Rupee Term Loan from Axis Bank Ltd. is secured by way of
hypothecation of factory shed & building, Plant & Machineries and other
fixed assets of Durgapur Unit and also equitable mortgage of the
factory shed & land belonging to Vanguard Credit & Holding Pvt. Ltd. on
pari passu basis with other term lenders along with its corporate
guarantee and personal guarantee of Managing Director of the company.
The loan of Rs. 4,500 Lacs is repayable in 20 equal quarterly
instalments commencing from April 2010, and Rs. 5,000 Lacs in 14 equal
quarterly instalments commencing from April 2012. Repayable within next
one year Rs. 900 Lacs (Previous year NIL).
f. The Term Loans for various modules of Integrated Steel project at
Kharagpur have been tied up under multiple banking arrangements and
secured by way of equitable mortgage of entire land including Building
thereon on pari passu basis. The Lender Banks are having 1st charge on
movable fixed assets of the specific module of the project on pari
passu basis with other term lenders of specific modules and 2nd pari
passu charge on the said assets on a reciprocal basis and further
secured by personal guarantee of the Managing Director of the Company
and some of the body corporates. Amount as per available terms of
sanction repayable with in next one year is Rs. 3,568 Lacs (Previous
year Rs. 447 Lacs).
g. Rupee Term Loan of Rs.24,120.13 Lacs are secured by subservient
charge on fixed assets of Kharagpur unit. Loan repayable within next
one year is Rs. 18,900 Lacs (Previous year Rs. 1,000 Lacs)
h. Term Loan from HSBC Limited was secured by way of first equitable
mortgage of all immovable properties and hypothecation of all movable
assets pertaining to Kalyani & Shyamnagar unit ranking pari-passu
with other term lenders and personal guarantee of Managing Director
together with pledge of part of company equity shares held by other
related companies Repayable within next one year NIL (Previous year Rs.
2,492 Lacs).
i. Term Loan from IREDA is secured by First charge by way of the
mortgage on all immovable properties & hypothecation of movable
assets/properties both existing and future pertaining to 3.75 MW Wind
Farm Project at Village Khori, Taluka Sakri, District Dhule, in the
state of Maharashtra (Project No. 1726) and elsewhere excluding
specified movables to be charged to bankers for Working Capital
Borrowings as agreed By IREDA. The Loan is Repayable in 24 equal
quarterly instalments of Rs. 52 Lacs commenced from 31st March 2006.
Repayable in next one year is Rs. 312 Lacs (Previous year Rs. 208
Lacs).
j. Working Capital Term Loan (WCTL) is to be repaid in quarterly
instalments. Repayable within next one year is Rs. 227.59 Lacs
(Previous year NIL).
k. Funded Interest Term Loan (FITL) is to be repaid in Quarterly
instalments. Repayable within next one year Rs. 2,733.95 Lacs (Previous
year NIL).
l. Rupee Term Loan from bank includes acceptances for Rs 1,235.23 Lacs
(Previous year Rs 4,365.30 Lacs) by way of L/C issued by bankers by
earmarking the term Loan facilities in favour of suppliers for Capital
Goods.
ii) Short Term/Working Capital Facilities
a. Working Capital facilities from banks for Kalyani Unit are secured
by hypothecation of stock of raw materials, finished goods, stock in
process, stores & spares etc., book debts and personal guarantee of
Managing Director of the Company and one of his relative together with
corporate guarantee of M/s Ramsarup Investments Ltd. and collaterally
secured by way of equitable mortgage on Leasehold Land and Building
thereon at Kalyani on pari passu basis with the Consortium of Banks and
IDBI Bank Limited and 2nd Charge on fixed assets financed by IDBI Bank
Limited.
b. Working Capital facilities from United Bank of India are secured by
hypothecation of stock of raw materials, finished goods, stock in
process, stores & spares etc. and book debts and second charge on its
fixed assets at Shyamnagar and personal guarantee of Managing Director
of the Company together with corporate guarantee of M/s. Ramsarup
Investments Limited.
c. Working Capital facilities from Punjab National Bank for the Mini
Blast Furnace at Kharagpur is secured by Hypothecation of entire stock
and book debts of the unit and personal guarantee of the Managing
Director of the company and collaterally secured by way of 3rd charge
on Plant & Machinery of the unit on pari passu basis with the charges
created and/or to be created by the company in favour of the other
working capital lenders.
d. Working Capital Facilities from Punjab National Bank and IDBI Bank
Ltd are secured on pari passu basis by hypothecation of entire stocks,
stock in process, finished goods, stores & spares, stocks-in-transit,
stock lying with others for conversion and book debts of Durgapur Unit
of the company.
e. Working capital facilities from Banks for some of its Turnkey
Projects are secured by hypothecation of stocks, book debts & other
current assets and personal guarantee of the Managing Director of the
company, and second charge on the Fixed Assets of Infrastructure Unit
on pari passu basis.
f. Short Term Loan from The Bank of Rajasthan Limited was secured by
way of first equitable mortgage of all immovable properties and
hypothecations of all movable assets created ranking Pari-Passu with
other term lender. Repayable within next one year NIL (Previous year Rs
760 Lacs).
g. Short Term Loan from Axis Bank is secured by 2nd Charge on block of
assets of Durgapur Unit. Amount repayable within next one year is Rs.
5,000 Lacs (Previous year Rs. 5,000 Lacs)
h. Non Funded facilities from certain banks are secured by way of first
pari-passu charge as applicable on inventories, book debts and other
movable assets.
i. Commercial Papers are issued by Earmarking Working Capital
facilities, maximum balance outstanding at any time during the year Rs.
1,000 Lacs (previous year Rs 5000 Lacs).
j. Buyers Credit from Bank are secured by earmarking term loan
facilities from banks.
3. UNSECURED LOAN
Some of the Unsecured Loans from Body Corporate are not bearing
interest.
4. LAND
a) At Kharagpur : The Company has been allotted by West Bengal
Industrial Development Corporation Ltd, Leasehold Land measuring about
315 acres for a period of 99 years at Saha Chowk, Rakha Jungle,
Kharagpur, Paschim Midnapur (W.B.) for its Integrated steel plant,
which has been registered during the year in the name of the Company.
b) At Maharashtra, Dhule : Free Hold Land and other Fixed Assets has
been acquired/installed by the company at R.S. No 481, 482 & 487
Village Khori, Dist Dhule in the state of Maharashtra.
5. The Company has promoted a Subsidiary Company in the name of
Ramsarup Energy Limited (REL) by agreeing to subscribe 49,000 Equity
Shares of Rs. 10/- each equivalent to 98% of Equity Share Capital of REL.
REL has been incorporated on 09-02-2010 with one of its main object of
carrying on the business of generation and distribution of electricity.
REL is in the preliminary stage, as such has opted to close its first
accounting year on 31-03-2011, as permitted by The Companies Act, 1956.
In view of this the accounts of the Subsidiary are not consolidated with
the accounts of the Company and a statement under Sec 212 of The Companies
Act, 1956 is not separately made.
6. DISCLOSURE UNDER THE MICRO, SMALL & MEDIUM ENTERPRISES DEVELOPMENT
ACT, 2006
There are no Micro, Small and Medium Enterprises as defined in Micro,
Small & Medium Enterprises Development Act, 2006 to whom the Company
owes dues on account of Principle amount together with Interest and
accordingly no addition or disclosure has been made.
7. Some of the advances included in Capital work in progress to the
extent of Rs. 303.47 Lacs (Rs. 99.79 Lacs) is covered by performance
guarantee received from the Bankers of the Contractors/Vendors and/or
Corporate guarantee against the same.
8. CAPITAL COMMITMENTS
Estimated amount of Contracts remaining to be executed on Capital
account and not provided for is Rs. 5523.00 Lacs (Previous year Rs
6807.80 Lacs), Advance Paid Rs. 123.46 Lacs, (Previous year Rs 127.63
Lacs) is covered by performance guarantee received from the Bankers of
the Contractors/Vendors and/or Corporate guarantee against the same for
Rs. 335.04 Lacs (Rs. 2,251.34 Lacs).
9. CONTINGENT LIABILITIES NOT PROVIDED FOR
a. Sales Tax Liabilities Rs. 5955.10 Lacs
(Under Appeal)
(Net of payments) (Rs. 2193.83 Lacs)
Bank Guarantees Rs. 6173.19 Lacs
(Rs. 6347.47 Lacs)
Note: - Margin held by Rs. 1922.87 Lacs
banks by way of pledge of (Rs. 2219.10 Lacs) FDRs for L/C & L/G
b. In respect of the Letter of Undertaking/Guarantees for Rs. 2,454.61
Lacs (Previous Year Rs. 1,078.06 Lacs) issued in favour of Dy.
Commissioner of Customs, for duty saved on account of Import of Plant &
Machinery against the Import License issued under Para 5.2/5.7 of Exim
Policy 2004-09 for lower Custom Duty under EPCG Scheme against which
differential duty has been paid in the year of import. This concession
is allowed based on the obligation that the Company will export items
up to eight times of duty saved and realize money in Convertible
Foreign Exchange out of which there is due export obligation of Rs.
19,57742 Lacs over a period of 8 years from the date of issue of such
license.
c. Show cause notices received by the Company has not been considered
as Contingent Liability.
10. Dividend on Cumulative Preference Shares amounting to Rs 38.28
Lacs for two years ended 31st March 2010 has not been provided for.
11. In the opinion of Board of Directors of the Company the current
assets, Loans & advances are approximately of the value as stated, if
realised in the ordinary course of business. The provision for all
known liabilities are adequate and not in excess of the amount
reasonably necessary. There are no contingent liabilities other than
those stated above. Certain balances of sundry debtors, advances and
sundry creditors are subject to confirmations/reconciliation.
12. Construction Expenses include transfer of material from/to other1
units Rs. 443.12 Lacs (Rs. 168.75 Lacs) and Rs. 110.29 Lacs (Rs.
1,543.22 Lacs) respectively.
13. The Company has opted for Tax Holiday U/S 80 IA of the Income Tax
Act, 1961 in respect of its income from power generation by 3 Nos. Wind
Turbine Generators (WTG) for a period of 10 years from the financial
year 2005-06.
14. The company is following the system of recognising CENVAT, Service
Tax, Education Cess, Service Tax Receivable, VAT etc through
receivable/payable in Balance Sheet.
15. Excise Duty and Cess recovered on sales during the year and shown
in Schedule 14 as "Sales Net of Excise Duty"amounts to Rs. 4657.87
lacs (Pervious year excise duty paid and CENVAT, Service Tax, Education
Cess etc. utilised and debited/adjusted in other heads amounts to Rs.
12258.57 lacs) .
16. Excise Duty on increase/decrease in stock represents differential
Excise Duty on Opening and Closing Stock of Finished Goods.
17. A sum of Rs. 66 Lacs has not been provided for maintenance of WTG
for two years pending settlement of claim of the company for lower
generation of power and break down of the WTG during earlier years.
18. There are two Foreign Currency Derivative Contracts
entered into by the company for hedging purposes outstanding as at 31st
March, 2010 and an adverse position of Rs. 299.32 Lacs (approx) on
Balance Sheet date has been indicated on Mark-to-Market basis which has
not been provided in the accounts and will be dealt with at the time of
crystallisation of the contracts.
19. MANAGERIAL REMUNERATION
Remuneration paid to the Managing Director and Whole time Director
amounts to Rs. 18,00,000/- and Rs. 6,00,000/- respectively which is
well within the limits prescribed under Schedule XIII of the Companies
Act, 1956. Hence computation of net profit for the purpose of Directors
remuneration under Section 349 of the Companies Act, 1956 has not been
enumerated.
20. DISCLOSURE PURSUANT TO ACCOUNTING STANDARD - 15 (REVISED)
EMPLOYEES BENEFITS
a. Defined Contribution Plans
In accordance with the Accounting Standard 15 on employee benefits
issued by the Institute Chartered Accountants of India, employer-
established provident fund trust are treated as defined benefits plans.
The Company in its Shyamnagar unit has established a provident fund
trust which is exempted U/S 17 of Employees Provident Fund Act, 1952
which stipulates that the employer shall make good deficiency if any,
in the interest rate declared by trust vis-ÃÂ -vis statutory rate. For
all other units the company contributes to the Regional Provident Fund
Commissioner (RPFC) and recognized as expense for the year as under :
Employers contribution to provident fund (to the Trust) Rs 36,27,086/-
Employers contribution to provident fund (to RPFC) Rs 78,56,703/-
21. RELATED PARTY DISCLOSURES
Related Party Disclosure in accordance with Accounting Standard 18
issued by the Institute of Chartered Accountants of India where
transaction exists :
a. Joint Venture Company : Moira Madhujore Coal Limited
b. Name of Related Parties and Description of Relationship :
Key Management Personnel {KMP} & their Relatives :
i. Sri Ashish Jhunjhunwala {Managing Director} ii. Smt. Sharda Devi
{Mother of M.D.} iii. Smt. Neerza Jhunjhunwala {Wife of M.D.} iv. Sri.
Naveen Gupta {Whole time Director} v. Ashish Jhunjhunwala {HUF}