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Notes to Accounts of Restile Ceramics Ltd.

Mar 31, 2015

1. The Equity Shareholders are entitled to receive dividends as and when declared, a right to vote in proportion to holding etc and their rights,preferences and restrictions are governed by terms of their issue and the provisions of the Companies Act,2013.

2. Capital Reserve represents amounts transferred upon cessation of liability under One time Settlement in earlier years.

3. Capital Reduction Reserve arose out of reduction in Equity Share Capital effected in Financial Year 2002-03 in terms of the order of the Board for Industrial and Financial Reconstruction (BIFR) dated December 18, 2002.

4. Deep Discount Bonds represents 5,37,521 bonds in the name of Sologuard medical Devices pvt ltd for a discounted price of Rs. 322/-. The said bonds mature on April 1,2025. Since the bonds are redeemable at the issue price up to April 1, 2015 no discount is recognized in the financial statements up to that date.

5. The Deep Discount Bonds are to be secured by all movable and immovable assets of the Company other than current assets hypothecated to working capital bankers and 3rd floor premises in Varun Towers, Begumpet. The Charge is under creation.

6. I n the light of the Company having an history of recent losses, accrual of deferred tax asset is restricted to timing differences, the reversal of which will result in sufficient income as laid down in para 18 of Accounting Standard 22 "Accounting for Taxes on Income"

7. The Loans from Banks carry interest of Prime Lending Rate(PLR) plus a rate of interest applicable to the Company based on norms,which varies depending upon "credit rating" by the lender and external agency.

8. Procedures relating to windingup of Restile Marketing Private Ltd under Sec.560 of the Companies Act,1956 has been complied with. Accordingly consolidated financial statements and details under section 129 of the Act, are not furnished.


Mar 31, 2014

1. The Equity Shareholders are entitled to receive dividends as and when declared, a right to vote in pro- portion to holding etc and their rights, preferences and restrictions are governed by terms of their issue and the provisions of the Companies Act,1956.

2. Capital Reserve represents amounts transferred upon cessation of liability under one time settlement in earlier years.

3 Capital Reduction Reserve arose out of reduction in Equity Share Capital effected in Financial Year 2002-03 in terms of the order of the Board for Industrial and Financial Reconstruction (BIFR) dated Decem-ber 18,2002.

4. : 537,527 Deep Discount Bonds of Rs.1000/- each were issued to Atreya Finance Pvt Ltd on March 30, 2009 at a discounted price of Rs.322. The said Bonds mature on March 31,2019 but both the parties have options to redeem/encash the same at an earlier date at predetermined discount rate or at a price to be agreed upon at the time of conversion after due written notice to the other party. Subsequent to the end of the previous year, the terms of these bonds have been renegotiated with the incremental price payable from a negotiated date after March 31,2015 instead of April 1,2010 as initially agreed upon. Since the bonds are redeemable at the issue price up to the said negotiated date no discount is recognised in the financial statements up to that date.

5. : The Deep Discount Bonds are to be secured by all movable and immovable assets of the Company other than current assets hypothecated to working capital bankers and 3rd floor premises in Varun Towers, Begumpet. The charge is under creation.

6. In the light of the Company having an history of recent losses, accrual of deferred tax asset is restricted to timing differences on account of unabsorbed depreciation, the reversal of which will result in sufficient income as laid down in para 18 of Accounting Standard 22 "Accounting for Taxes on Income.

7 Unsecured borrowing from bank represents temporary overdraft facility.

8. The Loans from Banks carry interest of Prime Lending Rate(PLR) plus a rate of interest applicable to the Company based norms,which varies depending upon "credit rating" by the lender and external agency.

9. Procedures relating to windingup of Restile Marketing Private Ltd under Sec.560 of the Companies Act,1956 has been complied with Accordingly consolidated financial statements and details under section 212 of the Act, are not furnished.

* Net of Rs.33.28 Lakhs adjusted against Provision made thereof

10. Salaries, Wages and Bonus is net of recoupment of Expenses of Rs.NIL (2013 Rs.66.89 Lakhs) from Bell Granito Ceramica Ltd (BGCL) under an arrangement for manufacture and sale of goods by BGCL under the Company''s brand.

11. Contingent liabilities

31.03.2014 31.03.2013

Rs. In Rs. In Lakhs Lakhs

a) Guarantees - - b) Claims (net) against the company not acknowledged as - debts - Sales tax Nil 197.13

c) A case has been filed against the Company in 1997 regarding alleged sale and lease back of certain fixed assets belonging to the company. The Company has disputed the veracity of the sale and lease back arrangement particularly since there was no evidence of appropriate approvals on behalf of the Company. The case is pending adjudication before the High Court and consequently, the said Company books assets continue in possession of and properly reflected in the account.The outflow in respect of the above is not practicable to ascertain in view of the uncertainities involved.


Mar 31, 2013

1.01 Segment Information

The company is principally engaged in a single business sengment viz.virtrified tiles and operates in one geographical segment as per Accounting Standarad-17 on''Segment Reporting''

1.02 Related party disclosure

a) Associate Companies

1 Sologuard Medical Devices (P) Limited

2. Atreya Fina.nce Pvt Ltd

3. Bell Granito Ceramica Limited

b) Key Management Personnel

1. Mr. Nalinkant Amratlal Rathod

2. Mr. tribhuvan Simh Rathod

c) Material Transactions with related parties

(i) Associate Companies I Bell Granito Ceramica Ltd a) Purchase of Finished Goods

1.03 The circularisation of balances of customers /suppliers is ih progress

1.04 The.Company has not received any information from "Suppliers" regarding their status under the Micro, Small and Medium Enterprises Development Act,2006 and hence disclosures, if any relating to the amounts unpaid as at the end of the year together with interest paid/payable under the Act have not been furnished.

1.05 Previous year''s figures have been regrouped / reclassified/amended wherever necessary to correspond with the current year''s classification.


Mar 31, 2012

NOTE : 1 SHARE CAPITAL

1.1: The Equity Shareholders are entitled to receive dividends as and when declared, a right to vote in proportion to holding etc. and their rights, preferences and restrictions are governed by terms of their issue and the provisions of the Companies Act, 1956.

NOTE 2: RESERVES AND SURPLUS

2.1 : Capital Reserve represents amounts transferred upon cessation of liability under One time Settlement in earlier years.

2.2 : Capital Reduction Reserve arose out of reduction in Equity Share Capital effected in Financial Year 2002-03 in terms of the order of the Board for Industrial and Financial Reconstruction (BIFR) dated December 18,2002.

NOTE 3: LONG TERM BORROWINGS

3.1 : 537,527 Deep Discount Bonds of Rs. 1000/- each were issued to Atreya Finance Pvt. Ltd on March 30, 2009 at a discounted price of Rs. 322. The said Bonds mature on March 31,2019 but both the parties have options to redeem/encash the same at an earlier date at predetermined discount rate or at a price to be agreed upon at the time of conversion after due written notice to the other party. Subsequent to the end of the previous year, the terms of these bonds have been renegotiated with the incremental price payable from April 1, 2013 instead of April 1,2010 as initially agreed upon. Since the bonds are redeemable at the issue price upto March 31,2012 no discount is recognised in the financial statements up to that date.

3.2 : The Deep Discount Bonds are secured by all movable and immovable assets of the Company other than current assets hypothecated to working capital bankers and 3rd floor premises in Varun Towers, Begumpet. The Charge is under creation.

NOTE 4 : DEFERRED TAX LIABILITIES (NET)

4.1 : In the light of the Company having an history of recent losses, accrual of deferred tax asset is restricted to timing differences, the reversal of which will result in sufficient income as laid down in para 18 of Accounting Standard 22 "Accounting for Taxes on Income"

NOTE: 5SHORT TERM BORROWINGS

5.1 : Unsecured borrowing from bank represents temporary overdraft facility.

5.2 : The above Loans are repayable on demand and carry interest of Prime Lending Rate(PLR) plus a rate of interest applicable to the company based on norms, which varies, depending upon "credit rating" by the lender and external agency.

NOTE 6 : NON-CURRENT INVESTMENT

6.1 : Restile Marketing Private Limited is in the process of being wound up under section 560 of the Companies Act,1956 (the Act.). Accordingly consolidated accounts and details under Section.212 of the Act, are not furnished.

NOTE 7 : CASH AND CASH EQUIVALENTS

7.1 : Balances with banks in deposit accounts comprises margin monies which have an original maturity of less than twelve months.

NOTE 8 : EMPLOYEE BENEFITS EXPENSE

8.1 : Salaries,Wages and Bonus is net of recoupment of Expenses of Rs. 139 54 Lakhs (2011 Rs. 150.58 Lakhs) from Bell Granito Ceramica Ltd (BGCL) under an arrangement for manufacture and sale of goods by BGCL under the Company's brand.

NOTE 9 : OTHER EXPENSES

9.1 PAYMENTS TO THE AUDITORS COMPRISES :

9.2 : Bad Trade and other receivables provided/written off in the earlier year Rs. 71.30 Lakhs is net of provision written back Rs. 52.03 Lakhs.

9.3 : Contingent liabilities 31.03.2012 31.03.2011 Rs. In Lakhs Rs. In Lakhs

a) Guarantees 42.60 43.61

b) Letters of Credit - 59.47

c) Claims (net) against the company not acknowledged as debts

- Sales tax 116.53 85.61

d) The Company has received notices subsequent to the end of the year demanding interialia that Cenvat Credit of Rs. 110 lakhs availed in earlier years on Capital Goods be reversed following shifting of the said machinery to the Company's unit being set up at Vadodara, Gujarat. Interest on the same has also been demanded. Even upon such reversal, the Company would be entitled to avail credit for the same at the Vadodara Unit and as such there may not be any impact on the Profit and Loss Statement. On the basis of legal advice, the Company will be contesting the said demand in due course.

e) A case has been filed against the Company in 1997 regarding alleged sale and lease back of certain fixed assets belonging to the company. The Company has disputed the veracity of the sale and lease back arrangement particularly since there was no evidence of appropriate approvals on behalf of the Company. The case is pending adjudication before the High Court and consequently, the said assets continue in possession of and properly reflected in the Company's books of account. The outflow in respect of the above is not practicable to ascertain in view of the uncertainties involved.



Note 10 : Additional information to the financial statements

10.1 : Exceptional items comprise sales tax liabilities arising upon completion during the year of assessments for various prior years and excise duty/service tax demands for earlier periods.

10.2 : Employee benefits

b) During the year the company has recognised the following amounts in the Profit and Loss Account in Note 24 Salaries and wages includes short term compensated absences Rs. 13.49 lakhs (2011: Rs. 13.49 Lakhs)

Contribution to provident, and other funds includes Provident fund and family pension Rs. 23.78 lakhs (2011: Rs. 20.77 lakhs), and contribution to employee state insurance plan Rs. 8.31 lakhs (2011: Rs. 8.32 lakhs).

c) The company has adopted Revised Accounting Standard 15 and comparatives have been provided for the Four Years for which data is available.

10.3 : Segment information

The company is principally engaged in a single business segment viz., Vitrified tiles and operates in one geographical segment as per Accounting Standard 17 on 'Segment Reporting'.

10.4 : Related party disclosure

a) Related Parties where control exists: Restile Marketing (P) Ltd.,

b) Associate Companies

Elister IT Solutions India (P) Limited

Sologuard Medical Devices (P) Limited

Athreya Finance Pvt. Ltd.

Bell Granito Ceramica Limited (w.e.f. 1.4.10)

c) Key Management Personnel, their relatives and their enterprises where transactions have taken place.

Mr. Nalin Amratlal Rathod

Mr. Tribhuvan Simh Rathod

10.5 : The company had in the earlier year. embarked on a exercise to review debit/credit balances of customers/ suppliers/others as appearing in the books of account and reconcile them with parties. This Review continued during the year and has revealed

i) Old debts not legally enforceable in view of time that has lapsed and debts from customers no longer in business.

ii) Debts not realisable in view of counter claims for discounts/ quality issues etc.

iii) Credit balances no longer payable due to one time settlement of dues and the period that has lapsed. Accordingly necessary accounting action to write off/write back their balances have been effected in the financial statements The above exercise would be completed with circularisation of balances of customers/suppliers.

10.6 : Amounts due to Small Scale Industrial undertakings are not ascertainable, (ii) The Company has not received any information from "Suppliers" regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any relating to the amounts unpaid as at the end of the year together with interest paid/payable under the said Act have not been furnished.

10.7 : The Revised Schedule VI has become effective from 1 April, 2011for the preparation of financial statements. Accordingly, previous year's figures have been regrouped/ reclassified/amended wherever necessary to correspond with the current year's classification.


Mar 31, 2010

1. There were no remittances of dividend in foreign currencies to non-resident shareholders *For part of the year

Perquisites include amounts evaluated as per Income tax Rules in respect of certain items.

Remuneration to Managing Director is from April 1,2009, the date of his appointment. Remuneration to Joint Managing director is up to 30.06.2008 while the remuneration to the Executive Director is up to July 11,2009.

2 Contingent liabilities

a) Guarantees 43.61 41.00

b) Letters of Credit 128.37 172.07

c) Claims (net) against the company not acknowledged as debts - Sales tax 72.94 497.87 - Others 1.64 -

d) Refer Note 13.1

(i) in the light ot the Company having an nistory ot recent losses, accrual of deterred tax asset is restricted to timing differences,the reversal of which will result in sufficient income as laid down in para 18 of Accounting Standard 22 "Accounting for Taxes on Income".

(ii) Considering the uncertainity in realising the business losses brought forward under tax laws, deferred tax asset estimated at Rs. 749.08 lakhs has not been accrued.

3 Segment information

The company is principally engaged in a single business segment viz., Vitrified tiles and operates in one geographical segment as per Accounting Standard 17 on Segment Reporting1.

4 Related party disclosure

a) Related Parties where control exists:

Restile Marketing (P) Ltd.,

b) Associate Companies

Elister IT Solutions India (P) Limited Sologuard Medical Devices (P) Limited Athreya Finance Pvt Ltd

c) Key Management Personnel, their relatives and their enterprises where transactions have taken place.

Mr. Nalin A. Rathod Mr. Tribhuvan Rathod Mr. G.V. Ramana Murthy* Mr. R.S. Raghavan*

*For Part oi the year

b) During the year the company has recognised the following amounts in the Profit and Loss Account in Schedule : 14

Salaries and wages includes compensated absences Rs.(6.24) lakhs (2009: Rs.15.73 Lakhs) and gratuity Rs.15.39 lakhs (2009: Rs.10.23 lakhs) Contribution to provident and other funds includes Provident fund and family pension Rs.23.07 lakhs (2009: Rs.33.55 lakhs), and contribution to employee state insurance plan Rs.6.49 lakhs (2009: Rs.6.73 lakhs)

c) The company has adopted Revised Accounting Standard 15 and comparatives have been provided for the Two Years for which data is available.

5. Towards the end of the year, the Company has embarked on an exercise to reconcile the balances disclosed as per books as dues to/from creditors/debtors and other parties.To the extent of balances that have been reconciled, corrective accounting action has been initiated wherever necessary and the results of the year incorporate the same. This exercise is in progress and will be completed during the ensuing year.

6 (i) Amounts due to Small Scale Industrial undertakings are not ascertainable,

(ii) The Company has not received

any information from "Suppliers" regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any relating to the amounts unpaid as at the end of the year together with interest paid/ payable under the said Act have not been furnished.

7 The Company has amortised the following expenditure during the year.Capital Issue expenses Rs.23.46 lakhs (2009:Rs.23.46 lakhs) ,Product Development expenses Rs. 82.68 Lakhs (2009 Rs.82.68 Lakhs) and Brand building expenses Rs.13.14 Lakhs (2009 Rs.13.14 Lakhs).

8 The Company has during the year changed its accounting policy to recognise the liability towards excise duty on finished goods lying uncleared at the factory as at the end of the year and consequently,consider the same in valuation valuation of the said stock. This change is pursuant to the requirements of Accounting Standard-2 "Valuation of Inventories".There is no impact on the results of the year due to the said change.

9. A case has been filed against the Company in 1997 regarding alleged sale and lease back of certain fixed assets belonging to the company. The Company has disputed the veracity of the sale and lease back arrangement particularly since there was no evidence of appropriate approvals on behalf of the Company. The case is pending adjudication before the High Court and consequently, the said assets continue in possession of and properly reflected in the Companys books of account.

10. Fixed assets include cost of vehicle Rs. 16.44 Lakhs.(2009 Rs.16.44) standing in the name of ersthwhile Joint Managing Director.

10.1 Other Liabilities include temporary overdraft from Bank Rs.22.11 lakhs(2009 Rs.Nil)

10.2 In Schedule 14, (i) Consumption of Raw Materials is net of Rs.171.37 Lacs (2009 Rs.Nil) capitalised, incurred during rial run up to March 1,2009 and sale of materials Rs.238.52 Lacs (2009 Rs.Nil).

(ii) spares and consumables is net of sale of Rs.118.88 Lacs (2009 Rs.Nil) and (iii) Packing material is net of (2009 Rs.Nil).

11 Secured Loan: 537527 Deep Discount Bonds of Rs.1000 each were issued to Athreya Finance private at a discounted price of Rs.344. The said bonds mature on April 1,2019 but both parties have options at an earlier date at predetermined interest rate or at a price to be agreed upon at the time of price prevalent as at that date for the said bonds.

12 Figures for the previous year have been regrouped/amended wherever ncessary.

 
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