Home  »  Company  »  Riddhi Siddhi Gluco  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Riddhi Siddhi Gluco Biols Ltd.

Mar 31, 2015

1. CORPORATE INFORMATION:

Riddhi Siddhi Gluco Biols Limited ("the Company") is engaged in the business of generation and selling power through windmill and in business of trading in agriculture and metal commodity items.

2. Employee Benefits:

a. Defined Benefit Plan

I. Gratuity:

The Company has a Defined Benefit Gratuity plan. The unfunded plan provides for a lump sum payment to employees, at retirement, death while in employment or on termination of employment, of an amount equivalent to 15 days salary for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of continuous service.

The following table summarizes the components of net benefit expense recognised in the Statement of Profit and Loss and liability recognised in the balance sheet for the plan.

3. The Company has commodity trade receivables amounting to Rs.7,594.82 lacs (Previous Years: Rs.7,623.55 lacs) as at March 31, 2015 pertaining to various commodities contracts executed through brokers on the National Spot Exchange Limited (NSEL). Over past few months, NSEL is unable to fulfill its scheduled payment obligations as agreed by them. Consequently, the Company has pursued a legal action against NSEL through NSEL Investor Forum which has also filed complaint in Economic Offences Wing of Mumbai (EOW). Considering the recent development and action taken by EOW against various borrowers of NSEL, the Company believes that it shall recover the outstanding dues over a period of time and therefore, the management believes that no provision is required to be made for the year ended March 31, 2015. The Company has received Rs.Nil (Previous Year: Rs.5.79 lacs)between period ending March 31, 2015 and date of adoption of accounts by the Board of Directors.

The Statutory auditors have qualified their audit reports for the years ended March 31, 2015 and March 31, 2014 for their inability to determine the amount of provision for doubtful receivables that may be required to be made in respect of the above matter.

4. The Company on receipt of approval from the Board of Directors in their meeting held on May 21, 2015, has entered into a Share Purchase Agreement (SPA) with the Promoters and entities forming part of the promoter group of Shree Rama Newsprint Limited (Target Company) for acquiring 2,82,77,677 equity shares of Rs.10 each, constituting 48.62% of the total paid up equity share capital of Target Company at a total consideration of Rs.1 lacs. The said acquisition would be subject to the terms of the SPA and necessary statutory and regulatory approvals, as may be required. Further, the Company would also be subscribing to a preferential allotment of 6,00,00,000 equity shares of Rs.10 each of Target Company.

In connection with the aforesaid, the Company in compliance with the Securities and Exchange Board Of India (Substantial Acquisition Of Shares And Takeovers) Regulations, 2011 has initiated the process of Open offer for acquisition of public equity shares of the Target Company upto 3,85,21,089 Equity shares of Rs.10 each representing 26% of the Emerging Paid Up Equity share capital of the Target Company. The offer price is Rs.10 per fully paid up equity share aggregating to Rs.3,852.11 lacs and will be paid in cash.

5. The Company's fixed assets include windmills having generating capacity of 33.5 MW and carrying amount of Rs.11,731.75 lacs as at March 31, 2015. The Company has entered into long term Power Purchase Agreement (PPA) in 2012 with State Distribution Corporations (Discoms) for a period ranging from 13-25 years based on a substantially fixed tariff per unit.

An incessantly lower Plant Load Factor (PLF) of windmills then expected over last few years of operations due to non-availability of grid and land related issues has triggered assessment of recoverable amount of the windmills in terms of Accounting Standard (AS) 28, Impairment of Assets, as these are factors indicating probable impairment. For the purpose of the said assessment, windmills are considered as a cash generating unit. The 'Recoverable Amount' of windmills has been measured on the basis of its Value in Use by estimating the future cash inflows over the estimated useful life of the windmills. The cash flow projections are based on estimates and assumptions relating to tariff, operational performance of the windmills, terminal value etc., which are considered reasonable by the management.

On a careful evaluation of the aforesaid factors, the management has concluded that the Recoverable Amounts of the windmills are lower than their carrying amounts as at March 31, 2015. Accordingly, the Company has recognized impairment loss of Rs.1,075.69 lacs during the year in respect of the windmills. In case the estimates and assumptions change in future, there would be a corresponding impact on the Recoverable Amounts of the windmills. The impairment loss on fixed assets relate to the "Wind Energy Generation" primary business reportable segment. The cash flows are discounted using the pre-tax nominal discount rate of 13.95% derived from the weighted average cost of capital.

6. During the year, the Company has bought back 23,41,914 fully paid-up equity shares of Rs.10 per equity shares at the rate of Rs.450 per equity share after complying with the provisions of the Companies Act, 2013 and the Rules framed thereunder in this regard through "Tender Offer" route as prescribed under the SEBI (Buy-Back of Securities) Regulation, 1998. On completion of buy back, the Company has paid Rs.10,538.61 lacs, which has been reduced from Share Capital, General Reserves and Securities Premium Account of the Company by Rs.234.19 lacs, Rs.3,501.52 lacs and Rs.6,802.90 lacs respectively. The Company has also transferred Rs.234.19 lacs from General Reserve to Capital Redemption Reserve pursuant to the Buy Back of Equity Shares. All shares bought under buy back were extinguished by the Company as of March 31, 2015.

7. During the current year, the Company has written back an amount of Rs.2,096.54 lacs towards remission of liability pertaining to plant and machineries purchased which is no longer payable, based upon the settlement reached with the vendor towards compensation of losses suffered by the Company. The amount written back has been disclosed under "Other Income" in the Statement of Profit and Loss.

8. Segment Reporting:

a. The Company has identified business segments as its primary segment and geographical segments as its secondary segment. Segments have been identified taking in to account the nature of the products, the differing risks and return, the internal organization and management structure and internal reporting system.

b. The Company's Operations pre-dominantly relate to Wind Energy Generation and trading of agriculture and metal Commodities. Accordingly, the Company has identified "Wind Energy Generation" and "Trading business" as the primary business segments, consisting of sale of wind power and trading of commodity items respectively.

c. Since all the operations of the Company are limited to India only there are no reportable geographical segments.

d. Segment Revenue, Segment Results, Segment Assets and Segment Liabilities include the respective amounts identifiable to each of the segments as also amounts allocated on a reasonable basis. Income and expenses, which are not directly relatable to the segments, are shown as unallocated items. Assets and liabilities that are directly attributable or allocable to segments are disclosed under each reportable segment. All other assets and liabilities are disclosed as Unallocable.

9. The Gross amount required to be spent by the Company during the year towards Corporate Social Responsibility is Rs.41.54 lacs as per section 135 of Companies Act, 2013. The Company has contributed Rs. Nil towards Corporate Social Responsibility during the year.

10. The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development (MSMED) Act, 2006 and hence disclosures under section 22 of The Micro, Small and Medium Enterprise Development (MSMED) Act, 2006 regarding :

a. Amount due and outstanding to suppliers as at the end of accounting year :

b. Interest paid during the year;

c. Interest payable at the end of the accounting year; and

d. Interest accrued and unpaid at the end of the accounting year have not been given.

11. The Company has significantly reduced trading in commodities business due to market volatility and accordingly the revenues from operations for the year ended March 31, 2015 are lower than those for the previous year.

12. The Company entered into aleasing arrangement in respect of a godown with Riddhi Siddhi Corn Processing Private Limited for a period of 24 months, with an option to vacate by giving three month's notice. The future lease rental income in respect of this lease arrangement is as under:

13. Figures for the previous year have been regrouped / rearranged, wherever necessary, to conform to current year's classification.


Mar 31, 2014

CORPORATE INFORMATION:

Riddhi Siddhi Gluco Biols Limited ("the Company") is engaged in the business of generation and selling power through windmill and in business of trading in agriculture and metal commodity items.

1. Terms / Rights attached to the sharesholders:

(i) Equity Shares:

The Company has only one class of equity shares having at face value of Rs. 10 per share. Each share holder of equity shares is entitled to one vote per share. The dividend proposed by the Board of Directors is subject to approval of the shareholders in ensuing Annual General Meeting. The Company declares and pays dividend in Indian rupees. The Board of Directors have recommended dividend pay-out of Rs. 3 per share (Previous Year: Rs. 10 per share) to the equity shareholders of the Company.

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the Shareholders.

(ii) Preference Shares:

The Company has only one class of preference shares i.e. Non Cumulative Redeemable Preference Shares of Rs. 10 per share. Such shares shall confer on the holders thereof, the right to a 8% preferential dividend from the date of allotment, on the capital for the time being paid up or credited as paid up thereon.Such shares shall rank for capital and dividend and for repayment of capital in a winding up, pari passu interse and in priority to the Equity Shares of the Company, but shall not confer any further or other right to participate either in profits or assets.

2. Terms attached to the preference shares:

The terms of redemption of Preference Share capital at face value is extended by two years during the year from November 2013 to November 2015 with a put and call option. The Preference Share capital has original maturity period of 7 years which was extended over a period of time, and again by two years from November 2013 to November 2015.

(a) ECB carries an interest rate of 6% to 7% p.a. and are secured against the windmills of the Company. ECB of JPY 7,117.50 Lacs is payable in 14 half yearly instalments and ECB of USD 177.78 Lacs is payable in 14 half yearly instalments. During the year, the Company has not complied with certain financial debt covenants related to these ECB. The lenders without recalling the loan have served notice of payment of interest at an accelerated rate of interest and have also asked for additional security to cover the shortfall in security provided. The Company is in negotiation with lenders to provide additional security.

(b ) Vehicle loans are secured by hypothecation of underlying vehicle taken against loan.

3. Contingent liabilities and commitments (to the extent not provided for):

(Rs. in lacs)

Particulars As at As at 31st March 2014 31st March 2013

Claims against the Company not acknowledged as debt

Excise Duty (refer note a) 2,486.48 2,486.48

Sales Tax (refer note b) 1.00 1.00

Service Tax (refer note c) 27.60 27.60

Income Tax (refer note d) 2,976.64 921.13

Total 5,491.72 3,436.21

Commitments:

Estimated amount of sales contracts to be executed against 13,250.82 the stock in trade lying as an inventory

Uncalled amount of contribution in private equity funds 800.00 400.00

a. Towards Levy of excise duty, including penalty but other than interest thereof on account of dispute in classification of finished goods, against which Company has appealed before Appellate Authorities and Commissioner (Appeals).

b. Towards penalty charges on account of dispute for sales tax demand against the pending form 19 to be submitted to tax authorities.

c. Towards Service Tax demand on refund claimed on services availed on export of goods i.e. CHA Services, Port Services and Goods Transport Services.

d. The Income-Tax assessments of the Company have been completed up to Assessment Year 2012-13. The disputed demand outstanding up to the said Assessment Year is Rs. 2,976.64 lacs. Based on the decisions of the Appellate authorities and the interpretations of other relevant provisions, the Company has been legally advised that the demand is likely to be either deleted or substantially reduced and accordingly no provision has been made.

It is not practicable to estimate the timing of cash outflows, if any in respect of matters (a) to (d) above, pending resolution of the proceedings with the respective appellate authorities.

4. Employee Benefits:

a. Defined Benefit Plan

I. Gratuity:

The Company has a Defined benefit Gratuity plan. The unfunded plan provides for a lump sum payment to employees, at retirement, death while in employment or on termination of employment, of an amount equivalent to 15 days salary for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of continuous service.

II. Leave encashment:

The Company has recognised amount of Rs. 0.39lacs (Previous year: Rs. 3.70lacs) as expense in the Statement of Profit and Loss in respect of Compensated absences.

5. As per Honorable High Court of Gujarat''s order approving the Scheme of Arrangement ("the Scheme") in the nature of demerger, from the Appointed Date of October 1, 2011 with Effective Date of May 29, 2012, the Corn Wet Milling undertaking was transferred to Riddhi Siddhi Corn Processing Private Limited ("RSCPPL"). The Scheme and related transactions for demerger and reduction in share capital was given effect to in the audited financial statements for the year ended 31st March, 2012.

As part of the Scheme, all assets and liabilities of the Corn Wet Milling undertaking including employees and their related liabilities were transferred to the RSCPPL, however contingent liabilities related to the period prior to Appointment Date i.e. 1st October 2011, arising out of regulatory, tax, labour, operational or environmental matters etc. remained with the Company.

As per the High Court Order, resultant excess of Rs. 63,807.06 lacs being the amount of net sale consideration and net value of assets and liabilities transferred had been added to the capital reserve under reserves and surplus. In view of specific option granted by the Honorable High Court of Gujarat''s order, during the previous year, the Company has transferred the said amount to the General Reserve.

6. The Company has commodity trade receivables amounting to Rs. 7,623.55 lacs as on 31st March, 2014 pertaining to various commodities contracts executed through brokers on the National Spot Exchange Limited (NSEL). Over past few months, NSEL is unable to fulfill its scheduled payment obligations as agreed by them. Consequently, the Company has pursued a legal action against NSEL through NSEL Investor Forum which has also filed complaint in Economic Offences Wing of Mumbai (EOW). Considering the recent development and action taken by EOW against various borrowers of NSEL, the Company believes that it shall recover the outstanding dues over a period of time and therefore, the management believes that no provision is required to be made as of 31st March, 2014. The Company has received Rs. 5.79 lacs between year ending 31st March, 2014 and date of adoption of accounts by the Board of Directors.

7. Segment Reporting:

a. The Company has disclosed business segment as the primary segment. Segments have been identified taking in to account the nature of the products, the differing risks and return, the organization structure and internal reporting system.

b. After the Demerger of Corn Wet milling business and its transfer to the Resulting Company in 2011-12, the Company''s Operations pre-dominantly relates to Wind Energy Generation and trading of agriculture and metal Commodity items. Accordingly, the Company has identified "Wind Energy Generation" and "Trading business" as the operating segments, consisting of sale of wind power and trading of commodity items respectively.

c. Secondary segment reporting is based on the geographical location of customers. Since, company has its operation activities limited to India only; no separate disclosure pertaining to secondary segment based on geographical location has been given.

d. Segment Information in terms of Accounting Standard 17 for the year ended 31st March, 2014 is as below:

8. On September 22 and 23, 2011, the Company was subjected to Search, Survey and Seizure operation by the Income Tax Department under section 132 and 133 of the Income Tax Act, 1961 ("the Act"). Subsequent to the above, during the year ended on March 31, 2012, the Company had made disclosure of an unaccounted income of Rs. 1,609.75 lacs under section 132(4) of the Act and the same had been shown as "exceptional item" under Discontinuing Operations in the Statement of Profit and Loss and the unaccounted income of Rs. 1,609.75 lacs had been accounted as utilized towards land development at Gokak factory premises during the year ended on March 31, 2012. The return of Income for the Assessment Year 2012-13 has been filed accordingly and the Company has provided for the resultant tax liability. In March 2014, the assessment is completed and there are no significant adverse findings during assessment.

Based on the decision of Appellate authorities and the interpretation of relevant provision, the Management of the Company has assessed that the demand is likely to be either deleted or substantially reduced and accordingly no provision is required to be made in the books of accounts.

9. The Company''s fixed assets include windmills having generating capacity of 33.5 MW and carrying amount of Rs. 13,384.43 lacs as at 31st March, 2014. The Company has entered into long term Power Purchase Agreement (PPA) in 2012 with State Distribution Corporations (Discoms) for a period ranging from 13-25 years based on a substantially fixed tariff per unit.

An incessantly lower Plant Load Factor (PLF) of windmills then expected over last few years of operations due to non-availability of grid and land related issues has triggered assessment of recoverable amount of the windmills in terms of Accounting Standard (AS) 28, Impairment of Assets. For the purpose of said assessment, windmills considered as a cash generating unit. For the purpose of cash generating unit, management has concluded that each of the windmill cannot be a cash generating unit, windmill farm at each location would be an appropriate cash generating unit.The ''Recoverable Amount'' of windmills measured on the basis of its Value in Use by estimating the future cash inflows over the estimated useful life of the windmills. The cash flow projections are based on estimates and assumptions relating to tariff, operational performance of the windmills, recovery of damages from supplier for under performance of the windmills, inflation, terminal value etc., which are considered reasonable by the management.

On a careful evaluation of the aforesaid factors, the management has concluded that the Recoverable Amounts of the windmills are higher than their carrying amounts as at 31st March, 2014. In case, these estimates and assumptions change in future, there could be a corresponding impact on the Recoverable Amounts of the windmills.

10. The Board of Directors at their meeting held on 20th May, 2014 have, subject to the approval of shareholders in general meeting through postal ballot and other regulatory approval, recommended a proposal to buy back, on a proportionate basis, from the shareholders/ beneficial owners of the equity shares of the Company as on the record date, up to 23,69,575 equity shares of the face value of Rs. 10 each (representing 25% of the total equity share capital of the Company) at a price not exceeding Rs. 450 per equity share payable in cash for a total consideration not exceeding Rs. 10,663.09lacs (the Maximum Buy-Back Size) which is less than 25% of the total paid up equity share capital and free reserves as per audited accounts of the Company for the financial year ended 31st March, 2014 through "Tender Offer" route as prescribed under the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 1998.


Mar 31, 2013

1. CORPORATE INFORMATION

Riddhi Siddhi Gluco BioLs Limited ("the Company") has made investment in Wind Farms and is currently engaged in generating and selling power. During the year, the Company has altered its object clause in the Memorandum of Association and it has started business of trading in agriculture and metal commodity items.

During the previous year, as per the Composite Scheme of Arrangement, the Company had transferred its Corn Wet Milling business to Riddhi Siddhi Corn Processing Private Limited (Refer Note 36).

2. Contingent liabilities and commitments (to the extent not provided for):

(Rs. in Lacs)

Particulars As at As at

March 31 2013 March 31 2012

i (i) Claims against the Company not acknowledged as debt

a. Excise Duty 2,486.48 2,412.08

b. Sales Tax 1.00 1.00

c. Service Tax 27.60 8.03

d. Income Tax 921.13 921.13

e. Other Maters - 35.00

Total 3,436.21 3,377.24

Commitments:

Estimated amount of sales contracts to be executed against 13,250.82 -

the stock in trade lying as an inventory

a. Towards Levy of excise duty, including penalty but other than interest thereof on account of dispute in classification of finished goods, against which Company has appealed before Appellate Authorities and Commissioner (Appeals).

b. Towards penalty charges on account of dispute for sales tax demand against the pending form 19 to be submitted to tax authorities.

c. Towards Service Tax demand on refund claimed on services availed on export of goods i.e. CHA Services, Port Services and Goods Transport Services.

d. The Company has received the High Court order on 1st May, 2012 and hence had not paid advance income tax pursuant to the gain on demerger and sale of Corn Wet Milling undertaking. The Company has filed the Interest waiver application as required under CBDT Circular 400/29/2002-IT(B) for waiver of interest under section 234 A, B and C of the Income-tax Act, 1961. Hence, the amount Rs.921.13lacs (Previous Year: Rs. 921.13 lacs) pertains to the possible claim of interest in case the waiver application is not accepted.

e. Others include possible claim relating to dispute with workers of Rs. NIL (Previous Year: Rs. 3 lacs) and a claim in case lodged against Company for an accident in Maize Starch Powder(MSP) plant of Gokak Unit amounting to Rs. NIL (Previous Year:Rs. 32 lacs)

It is not practicable to estimate the timing of cash outflows, if any in respect of matters (a) to (e) above, pending resolution of the proceedings with the respective appellate authorities. 28. Employee Benefits

a. Defined Benefit Plan

The Company has a defined benefit gratuity plan. The unfunded plan provides for a lump sum payment to employees, at retirement, death while in employment or on termination of employment, of an amount equivalent to 15 days salary for each completed year of service or part thereof in excess of six months. Vesting occurs upon completion of five years of continuous service.

During the financial year ended 31st March, 2012, pursuant to the Scheme referred in Note 33 all the employees of the Company have been transferred to RSCPPL with effect from 1st October, 2011 and hence the related employee benefit balances have also been transferred.

The following table summarizes the components of net benefit expense recognised in the Statement of Profit and Loss and funded status and amount recognised in the balance sheet for the plan.

3. Segment Reporting

a. The Company has disclosed business segment as the primary segment. Segments have been identified taking in to account the nature of the products, the differing risks and return, the organization structure and internal reporting system.

b. After the Demerger of Corn Wet milling business and its transfer to the Resulting Company in the previous year, the Company''s Operations pre-dominantly relates to Wind Energy Generation and trading of agriculture and metal commodity items. Accordingly, the Company has identified "Wind Energy Generation" and "Trading business" as the operating segments, consisting of sale of wind power and trading of commodity items respectively. Others consist of investment activities which comprises of less than 10% revenues. The Company has transferred the starch business to Riddhi Siddhi Corn Processing Private Limited (RSCPPL) with effect from 1st October, 2011 and accordingly the starch business has been reported as discontinued operations.

c. Secondary segment reporting is based on the geographical location of customers. Since, company has its operation activities limited to India only; no separate disclosure pertaining to secondary segment based on geographical location has been given.

4. On 22nd and 23rdSeptember, 2011, the Company was subjected to Search, Survey and Seizure operation by the Income Tax Department under section 132 and 133 of the Income Tax Act, 1961 ("the Act''). Subsequent to the above, during the year ended on 31st March, 2012, the Company had made disclosure of an unaccounted income of Rs.1,609.75 Lacs under section 132(4) of the Act and the same had been shown as "exceptional item" under Discontinuing Operations in the Statement of Profit and Loss and the unaccounted income of Rs.1,609.75 lacs had been accounted as utilized towards land development at Gokak factory premises during the year ended on 31st March, 2012. The return of Income for the Assessment Year 2012-13 has been filed accordingly and the Company has provided for the resultant tax liability. The assessment is pending and the management does not anticipate any further tax liability.

5. Based on the information available with the Company, there are no suppliers registered as micro & small enterprises under Micro, Small, Medium Enterprises Development Act, 2006. Accordingly, no interest is due or payable or paid or accrued and remaining unpaid to such supplier.

6. The Company had taken certain assets like office, residential, warehouses etc. on operating lease. These leasing agreements are cancellable and usually renewable on the mutually agreed terms. The aggregate lease rentals charged to the Statement of Profit and Loss are Rs. NIL lacs (Previous Year: Rs. 208.05 lacs under Discontinuing Operations).

7. The Company has entered into the leasing arrangement in respect of the godown with Riddhi Siddhi Corn Processing Private Limited for a period of 24 months, with an option to vacate by giving notice period of three months. The future lease rental income for the these lease arrangement is as under:

8. As per Honorable High Court of Gujarat''s order approving the Scheme of Arrangement ("the Scheme") in the nature of demerger, from the Appointed Date of 1st October, 2011 with Effective Date of 29th May, 2012, the Corn Wet Milling undertaking was transferred to Riddhi Siddhi Corn Processing Private Limited ("RSCPPL"). The Scheme and related transactions for demerger and reduction in share capital was given effect to in the audited financial statements for the year ended 31st March, 2012.

As part of the Scheme, all assets and liabilities of the Corn Wet Milling undertaking including employees and their related liabilities were transferred to the RSCPPL, however contingent liabilities related to the period prior to Appointment Date i.e. 1st October 2011, arising out of regulatory, tax, labour, operational or environmental matters etc. remained with the Company.

As per the High Court Order, resultant excess of Rs.63,807.06 lacs being the amount of net sale consideration and net value of assets and liabilities transferred had been added to the capital reserve under reserves and surplus and accordingly Corn Wet Milling undertaking was disclosed as discontinued operations in the prior year financial statements. In view of specific option granted by the Honorable High Court of Gujarat''s order, during the current financial year, the Company has transferred the said amount to the General Reserve.

9. The Statement of Profit and Loss for the year ended 31st March, 2013 contains the income from commodities trading transactions and Wind Mill operations, while the corresponding year ended 31st March, 2012 contains only income from Wind Mill operations. Hence, to that extent current year results are not comparable with the previous year results.

10. Previous year figures have been re-grouped/re-classified wherever necessary to correspond with the current year classification/ disclosure.


Mar 31, 2012

1. CORPORATE INFORMATION

Riddhi Siddhi Gluco Biols Limited ("the Company") has made investment in Wind Farms and is currently engaged in generating and selling power. The Company was primarily engaged in manufacturing and selling of Starch products, its derivatives and related by- products. During the year, as per the Composite Scheme of Arrangement, the Company has transferred its Corn Wet Milling business (Refer Note 24).

a. Terms / Rights attached to the equity shares

The Company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividend in Indian rupees. During the year, the board of directors have recommended dividend payout of Rs. 25 per share (Previous Year: Rs. 12.5 per share) to the shareholders of the Company.

In the event of liquidation of the company, the holders of the equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the Company.

b. Terms / Rights attached to the preference shares

Preference shares are redeemable at par on November 3, 2013 with a put and call option anytime after November 3, 2009

(a) ECBs carry an interest of 6 to 7% p.a. and are secured against the windmills of the Company. ECB of JPY 854.10 lacs is payable in 18 half yearly instalment commencing from February 22, 2012 and ECB of USD 200 lacs is payable in 18 half yearly instalments commencing from September 20, 2012.

(b) Vehicle loans are secured by hypothecation of underlying vehicle taken against loan

(c) The rupee and the foreign currency term loans amounting to Rs. NIL (Previous year: Rs. 7,646.55 lacs) are secured by first pari passu charge on the present and future fixed assets of Gokak, Viramgam and Rudrapur units of the Company, by a second pari- passu charge on the current assets of these units and further secured by personal guarantees of some of the directors of the Company. {Refer Note 24(b) and (g)}

* Includes Rs. 99,933.59 lacs receivable from Riddhi Siddhi Corn Processing Private Limited where a director of the Company is a director.

2. Corn Wet Milling Undertaking:

a. The Company's petition dated June 28, 2011 for a Composite Scheme of Arrangement ("the Scheme") under sections 391 and 394 read with sections 100 to 104 of the Companies Act, 1956 in the nature of Demerger and transfer of Demerged Undertaking of the Company to Riddhi Siddhi Corn Processing Private Limited ("RSCPPL" or "Resulting Company") and reduction of share capital of the Company has been approved by The Hon'ble High Court of Gujarat vide its order dated February 7, 2012, which order has been received by the Company on May 1, 2012. The appointed date as per the Scheme is October 1, 2011 and the effective date is May 29, 2012 (the date the said scheme has been filed with the Registrar of Companies, Gujarat). Accordingly, the effect of the Scheme has been given in these financial statements of the Company for the year ended March 31, 2012.

b. Pursuant to the Scheme, all the assets and liabilities of the Corn Wet Milling business including industrial undertakings located at Viramgam, Gokak and Rudrapur ("Demerged Undertaking" as defined in the Scheme) have been transferred to RSCPPL at the book values as at the Appointed Date, on a going concern basis. The summary of the assets and liabilities transferred are as under.

As per the Scheme, all contingent liabilities relating to the period prior to the Appointed Date arising out of regulatory, tax (including income tax, excise duty and sales tax liabilities), labour, operational or environmental matters etc and all such liabilities have been continued to be to the account of the Company and have not been transferred to the Resulting Company.

c. For the transfer of the Demerged Undertaking, the sale consideration, as computed in terms of paragraph number 13 of the Scheme and as per mutual understanding reached between the Company, on one hand and RSCPPL and RoquetteFreres, France ("RF") on the other hand as evidenced by a Memorandum of Understanding ("MOU") dated March 30, 2010 (read with Addendums dated May 18, 2012), is as under:

(i) RSCPPL to allot 2,000,000 Equity shares of face value of Rs. 10 each to the Company on the Effective Date and as per the mutual understanding reached between the parties, the Equity Shares so allotted have been sold by the Company to RF. The realization on such sale of the shares amounts to Rs.13,659.34 lacs.

(ii) Consideration of Rs.104,789.04 lacs(net of related costs and non-compete fees payable to promoters and their relatives of Rs.11,377.54 lacs).

d. The excess of the amount of net sale consideration as stated in c above and net value of assets and liabilities transferred as stated in b above, amounting to Rs.81,640.75 lacs and after deducting current tax liability thereon amounting to Rs. 18,000 lacs, has been added to the balance of Capital Reserve under Reserves and Surplus.

e. Further, as provided in the Scheme and as per the provisions of Section 100 or any other applicable provisions of the Companies Act, 1956, the Issued, Subscribed and Paid up Equity Share Capital of the Company has been reduced from Rs.1,114.14lacs divided into 11,141,400 Equity shares of Rs.10 each to Rs. 947.83 lacs divided into 9,478,300 Equity Shares of Rs.10 each by way of cancelling 1,663,100 Equity shares of Rs. 10 each held by the foreign shareholder - Roquette Freres.

f. As per the Scheme, during the period between the Appointed Date and the Effective Date, the Company was deemed to have carried on the Corn Wet Milling business undertaking in "trust" on behalf of RSCPPL. Further, all the profits or incomes earned and losses and expenses incurred for the Corn Wet Milling business undertaking, shall for all purpose be deemed to be profits or income or losses or expenditure of RSCPPL.

g. Regulatory formalities for transfer of legal ownership and title deeds of certain category of assets like immovable properties, licences, agreements, loan documents, investments, employee retirement benefit schemes and related policies and bank balances in the name of the Resulting company, as envisaged under the Scheme, are in process.

3. On September 22 & 23, 2011 the Company, along with other group companies and promoters, were subjected to Search, Survey and Seizure operation by the Income Tax Department under section 132/133 of the Income Tax Act, 1961 ("the Act'). Subsequent to the above, the Company has made disclosure of an unaccounted income of Rs.1,609.75 lacs excluding amount disclosed by other group companies and promoters, if any, under section 132(4) of the Act and the same has been shown as "exceptional item" under Discontinuing Operations in the Statement of Profit and Loss. Further, above unaccounted income of Rs. 1,609.75 lacs has been accounted as utilized towards land development at Gokak factory premises, during the year ended on March 31, 2012. The management proposed to take appropriate steps to adequately support the same in due course of time.

4. RSCPPL a subsidiary of the Company was formed for the purpose of transfer of Company's Corn Wet Milling undertaking vide Composite Scheme of Arrangement. The Company has not prepared Consolidated Financial Statements in terms of paragraph 11 of the Accounting Standard 21 'Consolidated Financial Statements' because RSCPPL being the only subsidiary with a clear intention of subsequent disposal. During the financial year ending March 31, 2012, the Company has sold its investments in RSCPPL. [Refer Note 24(c )]

5. Segment Reporting

a) The Company has disclosed business segment as the primary segment. Segments have been identified taking in to account the nature of the products, the differing risks and return, the organization structure and internal reporting system.

b) The Company's Operations pre-dominantly relates to manufacture of starch, its derivatives and related by-products. Accordingly, the Company has identified "Starch & allied Products" and "Wind Energy Generation" as the operating segments, consisting of manufacturing and sale of starch & allied products and wind power respectively. Others consist of trading activities which comprises of less than 10% revenues. As referred in note 24 above the Company has transferred the starch business to RSCPPL with effect from October 1, 2011 and accordingly the starch business has been reported as discontinued operations.

c) Secondary segment reporting is based on the geographical location of customers. The geographical segment have been identified based on revenues with in India (sales to customers with in India) and revenues outside India (sales to customers located outside India).Since the export market revenue, results and assets constitute less than 10% of the total revenue, results and assets, the same has not been disclosed.

6. Contingent Liabilities not provided for (Refer Note 24)

(Rs. in lacs)

Particulars As at As at March 31 2012 March 31 2011

(i) Outstanding Corporate Guarantees at the balance sheet date - 2,516.21 [Corporate Guarantees by the Company Rs. Nil lacs (Previous Year Rs. 5,500 lacs)]

(ii) Claims against the Company not acknowledged as debt

Excise Duty 2,412.08 1,923.40

Sales Tax 1.00 1.00

Service Tax 8.03 8.03

Income Tax 921.13 -

Other Maters 35.00 48.00

(iii) Bills Discounted with Banks - 429.31

3,377.24 4,925.95

a) Towards Levy of excise duty, including penalty but other than interest thereof on account of dispute in classification of finished goods, against which Company has appealed before Appellate Authorities and Commissioner (Appeals).

b) Towards penalty charges on account of dispute for sales tax demand against the pending form 19 to be submitted to tax authorities.

c) Towards Service Tax demand on refund claimed on services availed on export of goods i.e. CHA Services, Port Services and Goods Transport Services.

d) As mentioned in Note 24, the Company received the Court order on May 1, 2012 and hence had not paid advance income tax pursuant to the gain on demerger and sale of Corn Wet Milling undertaking. The Company is in the process of filling the Interest waiver application as required under CBDT Circular 400/29/2002-IT(B) for waiver of interest under section 234 A, B and C of the Income tax Act, 1961. Hence, the amount Rs. 921.13lacs (Previous Year: NIL) pertains to the possible claim of interest in case the waiver application is not accepted.

e) Others include possible claim relating to dispute with workers of Rs.3lacs (Previous Year: Rs.43 lacs) and a claim in case lodged against Company for an accident in Maize Starch Powder(MSP) plant of Gokak Unit amounting to Rs. 32lacs (Previous Year: Rs.5 lacs)

It is not practicable to estimate the timing of cash outflows, if any in respect of matters (a) to (e) above, pending resolution of the proceedings with the appellate authorities.

7. During the year, the Company has utilised Minimum Alternative Tax Credit Entitlement (MAT Credit) of Rs.923.24 lacs in terms of Section 115JAA of the Income Tax Act, 1961, which was not recognised in the books of account during the financial year ended March 31, 2011 due to absence of convincing evidence regarding its realisability in future.

8. Based on the information available with the Company, there are no suppliers registered as micro & small enterprises under Micro, Small, Medium Enterprises Development Act, 2006. Accordingly, no interest is due or payable or paid or accrued and remaining unpaid to such supplier.

9. Employee Benefits

a) Defined Benefit Plan

The Company has a defined benefit gratuity plan. The scheme is funded with the Life Insurance Corporation of India in the form of a qualifying insurance policy. Pursuant to the Scheme referred in Note 24 all the employees of the Company have been transferred to RSCPPL with effect from October 1, 2011 and hence the related employee benefit balances have also been transferred.

* In the absence of availability of relevant information for the past year's, the experience adjustments on plan assets and liabilities have not been furnished as required by para 120(n) of Accounting Standard 15 (R).

b) Defined Contribution Plan:

During the year contribution of Rs.86.76 lacs (Previous Year: Rs. 138.13 lacs) as shown under Discontinuing Operations has been made by the company towards Provident Fund, Employee State Insurance (ESI) and Super Annuation Fund Scheme.

10. The Company has taken certain assets like office, residential, warehouses etc. on operating lease. These leasing agreements are cancellable and are usually renewable on the mutually agreed terms. The aggregate lease rentals charged to the Statement of Profit and Loss under Discontinuing Operations are Rs. 208.05 lacs (Previous Year: Rs. 147.96 lacs).

11. The Revised Schedule VI has become effective from April 1, 2011 for the preparation of financial statements. This has significantly impacted the disclosure and presentation made in the financial statements. Previous year figures have been re-grouped/ re-classified wherever necessary to correspond with the current year classification/disclosure.

12. As mentioned in Note 24(a), appointed date is October 1, 2011 and Effective Date of the scheme is May 29, 2012, accordingly the effect of the Scheme has been given in the financial statement of the Company for the year ended March 31, 2012 and hence the figures of the previous year are not comparable with the current year.

13. The figures of the previous year were audited by a firm of Chartered Accountants other than Deloitte Haskins & Sells.


Mar 31, 2009

1. In the Opinion of the Director, the current assets, loans and advances are approximately of the value stated, if realised in the ordinary course of the business and there is no contingent liability other than stated and provisions for all known liabilities are adequately made.

2. The balances of loans, capital work in progress, current liabilities, debtors, loans and advances are subject to confirmation and subsequent clearance of cheques and necessary adjustment/ provisions or proper classification, if any required will be made on its reconciliation.

3. a) The amount of capital work in progress consists of capital work in progress & sundry advances of Rs. 1029.76 lacs (Previous year Rs. 568.65 lacs) and creditors for capital goods of Rs. 419.88 lacs (Previous year Rs. 526.67 lacs).

b) Amount of sales bills/orders discounted with the bankers of Rs. 766.82 lacs (Previous year Rs. Nil) has been reduced from the balance of Sundry debtors.

4. The Company has acted as a facilitator for providing the finance to the Village Level Aggregators for purchase of raw materials and dues of the bank has been shown under the head "Unsecured Loan".

5. During the year, against the claim for damage of Corn Starch Drying Plant at Gokak of Rs. 168.83 lacs Rs. 75.00 lacs was received and balance amount is still to be settled and received and the same has been shown as receivable.

6. During the year the Company has been granted capital subsidy for Development of Project from Government of India of Rs. 72.90 lacs (Previous year Rs. 485.20 lacs) and the same has been credited to Capital Reserve Account.

7. Company is contingently liable for: -

a) Estimated amount of contract remaining to be executed on capital account and not provided for Rs. 848.00 lacs (Previous year Rs. 250.00 lacs).

b) Disputed Income tax liability of Rs. Nil (other than the matters in which department is in appeal) (Previous year 12.46 lacs) against which appeals are pending before an Appellate Authority.

c) Disputed Sales Tax Liability of Rs. 6.81 lacs (Previous year Rs. 6.81 lacs).

d) Excise Liability of Rs. 1787.04 lacs (Previous year Rs. 1 510.40 lacs) other than interest and penalty on account of dispute in classification of products, against which Company has preferred appeals before an Appellate Authority.

e) Counter Guarantees of Rs. 86.00 lacs (Previous year Rs. 134.27 lacs) given to the bank.

f) Electricity Tax of Rs. Nil lacs (Previous year Rs. 23.39 lacs).

g) Estimated amount relating to disputed labour law matters Rs. 5.85 lacs (Previous year Rs. 3.50 lacs).

h) Estimated amount relating to case lodged against Company for an accident at MSP Plant of Gokak unit Rs. 5 lacs (Previous year Nil).

8. Pursuant to the amendment of the transitional provisions of Accounting Standard 11 on The Effects of Changes in Foreign Exchange Rates, exchange differences have been accounted for as described in A(12) of Schedule 14 foregoing.

Accordingly Rs. 2187.61 lacs has been added to the cost of Fixed assets, Rs. 1013.61 lacs transferred to Foreign Currency Monetary Item Translation Difference Account (unamortised balance at year end Rs. 675.74 lacs) and consequently, the Profit for the year is higher by Rs. 3021.16 lacs and the General Reserve is lower by Rs. 157.80 lacs.

9. The Company has fulfilled the export obligation against import of capital goods / consumable stores under EPCG Scheme and procedure for closures of license with the concerned authorities is in progress.

10. During the year, on the basis of records, the Company has capitalised various indirect expenses related to the project, amounting to Rs. 19.90 lacs (Previous year Rs. 1220.92 lacs).

11. The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosure relating to amounts unpaid as at the year end together with interest paid/payable under this act and as required by Schedule VI of the Companies Act, 1956 have not been given.

12. The Company is engaged in Corn-Wet-Milling and as an integrated business of manufacturing Starches and its derivatives, since there is only one economical & political condition and exchange control regulation: hence does not have a reportable segment, identifiable in accordance with AS- 17, issued by The Institute of Chartered Accountants of India.

13. The Company has opted for the Group gratuity cum life insurance scheme of the Life Insurance Corporation of India (LIC). The Company charge actuarial valuation to the profit and loss account. LIC has confirmed that the contribution taken together with the fund available with LIC in the corpus cover adequately the actuarially valued gratuity liability of the Company, LIC would, however, seek replenishment of funds, should the funds get depleted due to abnormal withdrawal in any year.

IV) Value of Imports

- CIF value of imports:- - Capital Goods Rs. 208.17 lacs (Rs. 305.42 lacs)

- Raw material & Chemicals Rs. 336.81 lacs (Rs. 182.42 lacs)

- Stores & consumables Rs. 18.65 lacs (Rs. 5.41 lacs)

- Technical services & expenditure Rs. 12.93 lacs (Rs. 10.84 lacs)

V) Expenditure in foreign currency

- Travelling expenses of Rs. 12.44 lacs (Rs. 7.16 lacs)

VI) Earning in foreign exchange:

- FOB Value of Exports Rs. 5400.01 lacs (Rs. 2358.33 lacs).

14. Previous year figures have been rearranged or regrouped wherever necessary. Figures in brackets are of previous year.

15. Signed Schedule No. 1 to 14 forms part of the annexed accounts of the Company.

 
Subscribe now to get personal finance updates in your inbox!