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Notes to Accounts of Sanghvi Movers Ltd.

Mar 31, 2016

1 Rights, preferences and restrictions attached to equity shares

The Company has a single class of equity shares. Accordingly, all equity shares rank equally with regard to dividends and share in the Company''s residual assets. The equity shares are entitled to receive dividend as declared from time to time. The voting rights of an equity share holder on a poll (not on show of hands) are in proportion to its share of the paid up equity capital of the Company. Voting rights cannot be exercised in respect of shares on which any call or other sums presently payable have not been paid.

Failure to pay any amount called up on shares may lead to forfeiture of the shares.

On winding up of the Company, the holders of equity shares will be entitled to receive the residual assets of the Company, remaining after distribution of all preferential amounts in proportion to the number of equity shares held.

i) Term loans from banks in Indian rupees carry interest rate ranging from 10.50% to 11.40% p.a. Repayable in 16 to 60 monthly and 9 to 22 quarterly installments.

ii) Loans from related parties are repayable on demand with a notice of 13 months and carry an interest ranging from 7.25 % - 12.30 % p.a.

iii) Term loans from bank in foreign currency carry interest rate of one year EURIBOR 0.68% which is repayable on 27 March 2018.

Security

a) Term loans amounting to Rs. 29,488.10 Lakhs (2015 : Rs. 10,690.90 Lakhs) are secured against cranes/trailers.

b) Term loans amounting to Rs. 13,290.47 Lakhs (2015 : Rs. 11,513.69 Lakhs) are secured against cranes/trailers and Registered mortgage on land and buildings at Tathawade.

c) Term loans amounting to Rs. 12,076.03 Lakhs (2015 : Rs. NIL) are secured against cranes and Land at Vadagaon, Pune.

d) Term loans amounting to Rs. 3,422.28 Lakhs (2015 : Rs. 4,248.59 Lakhs) are secured against cranes and office building at Sate, Pune.

e) Term loans amounting to Rs. NIL (2015 : Rs. 4,997.87 Lakhs) are secured against cranes and equitable Mortgage of residential land at Sate & personal guarantees given by Chairman and Managing Director Mr. Chandrakant Sanghvi till the conversion of land into Non-agricultural land.

f) Also refer note 19.

a) Claims against the Company not acknowledged as debts comprises of claims raised on Company by its customers amounting to Rs. 117.92 Lakhs (2015 : Rs. 167.16 Lakhs) for breach of contracts and by certain government authorities amounting to Rs. 125.92 Lakhs (2015 : Rs. 75.68 Lakhs) on account of road taxes and charges for conversion fees for land. The Company has been advised by its legal counsel that it is possible, but not probable, that action will succeed in respect of claims against the Company. These claims are being contested in the courts by the Company. The Management does not expect these claims to succeed. Accordingly, no provision for the contingent liability has been recognized in the financial statements.

b) Sales tax matters includes demand notice received from various authorities regarding transfer of right to use the goods as mentioned below:

The Company has received Notice of Demand on 25th May 2015 from Assistant Commissioner of Sales Tax (PUN-INV-D-007) Pune in respect of Order of Assessment for Financial Year 2008-09 towards VAT and CST liability regarding transfer of right to use the goods .

Based on various favorable judgments and considering the nature of its business, the management believes that rendering Crane Services on rental basis does not involve "transfer of right to use goods" so as to fall under the purview of VAT or Sales tax. As the Company never passes effective control and possession of its cranes to its customers, the question of levying VAT or CST does not arise.

c) Income tax matters comprise demand from the tax authorities for the payment of additional tax of Rs. 34.64 Lakhs (2015 : Rs. 102.47 Lakhs) upon completion of their tax reviews for the various financial years. The tax demands are mainly on account of TDS liability under the Income Tax Act. The matter is pending before the Commissioner of Income Tax (Appeals).

d) Service tax matters comprise of demand raised by tax authorities for the payment of service tax of Rs. 237.48 Lakhs (2015: Rs. 261.20 Lakhs) on account of services provided to SEZ developer/unit where exemption have been claimed by the Company. The matter is pending before the Customs, Excise and Service Tax Appellate Tribunal.

The Company is contesting the above demands of Sales tax, Income tax and Service tax and the management, including its tax advisors, believe that its position will likely be upheld in the appellate process. No tax expense has been accrued in the financial statements for the tax demand raised. The management believes that the ultimate outcome of this proceeding will not have a material adverse effect on the Company''s financial position and results of operations.

2. Related party disclosures

a) Individuals exercising significant influence over the company

1 Mr. Chandrakant Sanghvi

b) Key management personnel

1 Mr. Chandrakant Sanghvi - Chairman and Managing Director

2 Mr. Sham Kajale - Executive Director and Chief Financial Officer

3 Mr. Rajesh Likhite - Company Secretary

c) Relatives of Individuals exercising significant influence over the company

1 Mrs. Mina Sanghvi - Spouse of Chandrakant Sanghvi

2 Mr. Rishi Sanghvi - Son of Chandrakant Sanghvi

3 Ms. Niyoshi Sanghvi - Daughter of Chandrakant Sanghvi

4 Ms. Ruchi Sanghvi - Daughter of Chandrakant Sanghvi

5 Mr. Anilkumar Sanghvi - Brother of Chandrakant Sanghvi

d) Enterprises over which key management personnel exercise significant influence

1 Jethi Builders and Traders Private Limited

2 Sanghvi Erectors Private Limited

3 Maharashtra Erectors Private Limited

3. Deferral/capitalization of exchange differences

On 29th December 2011, the Ministry of Corporate Affairs (’MCA’) has issued an amendment to Accounting Standard 11- The Effects of changes in Foreign Exchange Rates and clarification provided vide circular 25/2012 dated 09 August 2012. The amendment permits Companies to defer/capitalize the exchange differences arising on Long Term Foreign Currency Monetary Items.

In accordance with the amendment, the Company has capitalized exchange gain arising on unhedged long term foreign currency loans, amounting to Rs. NIL (2015 : Rs. 544.18 Lakhs) to the cost of plant and equipments. There is no exchange loss deferred in ’Foreign Currency Monetary Translation Difference Account’, as there are no other long term foreign currency monetary items.

4. Foreign currency exposures outstanding at the year end

(a) The Company has hedged its foreign currency risk exposure and the forward cover outstanding as at the Balance Sheet date

5. Segment reporting

The Company is primarily engaged in the business of providing cranes on rental basis. Further all the commercial operations of the Company are based in India. Accordingly, there is no separate reportable segment in accordance with AS 17- Segment Reporting prescribed under the Companies (Accounting Standards) Rules, 2006 which continue to apply under Section 133 of the Companies Act, 2013 read together with Rule 7 of the Companies (Accounts) Rules 2014.

6. Corporate Social Responsibility

As per provisions of Section 135 of the Companies Act 2013, the Company was required to spend Rs. 39.14 Lakhs (2015 : Rs. 123.76 Lakhs) being 2% of average net profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy on the activities specified in Schedule VII of the Act.

7. Derivative instruments

During the current financial year, the Company has availed 3 years Buyers’ Credit Facility (‘hedged item’) of Euro 72.00 Lakhs (2015: NIL). Being a Foreign Currency Loan, it is exposed to the risk of foreign currency fluctuations & interest rate fluctuation. In order to mitigate the effect of these fluctuations, the Company has simultaneously entered into fully hedged structure (an Interest Rate Swap (IRS) and Principal Swap Structure (POS)- ‘hedging instrument’) whereby the Company fixed the principal repayment and its interest outflows in Indian Rupee terms as they fall due.

As at the year end, the Company has recorded a mark-to-market loss of Rs. 294.23 Lakhs (2015: NIL) in Hedging Reserve, being the effective portion of the change in fair value of the Hedging Instrument. Further, to match the gains and losses of the hedged item and the hedging instrument in the Statement of Profit and Loss, Rs. 287.28 Lakhs (2015: Nil) has been recycled from the Hedging Reserve to the Statement of Profit and Loss.


Mar 31, 2014

Particulars For the year ended 31st March 2014 31st March 2013 1. Contingent liabilities and commitments Contingent liabilities

(a) Claims against the Company not acknowledged as debts 82.17 104.30

(b) Bills receivable discounted — 279.22

(c) Sales tax matters (refer note ''i'' below) 707.06 125.00

(d) Income tax matters* 258.94 535.90

(e) Service tax matters* 261.20 — excluding consequent penalties, if any

Commitments

Estimated amount of contracts 29.40 86.11 remaining to be executed on capital and not provided for (net of advances)

1,338.77 1,130.53

i) Includes demand notice of Rs. 363.94 lakh (2013: Rs. Nil) towards VAT and Rs. 218.37 lakh (2013: Rs. Nil) for interest aggregating to Rs. 582.31 lakh (2013: Rs. Nil) received from Deputy Commissioner of Sales Tax under Maharashtra Value Added Tax Act, 2002 for the year 2009-10 and Rs. 124.75 (2013: Rs. 124.75) from Joint Commissioner of Sales Tax under Gujarat Value Added Tax Act, 2003 for the year 2008-09 regarding transfer of right to use the goods. The Company is in process of contesting the demand in appeal under Maharashtra Value Added Tax Act, 2002 and has contested the demand in appeal under the Gujarat Value Added Tax Act, 2003.

2. Related party disclosures

a) Individuals exercising significant influence over the company

1 Mr. Chandrakant Sanghvi

b) Key management personnel

1 Mr. Chandrakant Sanghvi

2 Mr. Ramchandra Desai (upto 1 November 2012)

3 Mr. Sham D. Kajale

c) Relatives of Individuals exercising significant influence over the company

1 Mrs. Mina C. Sanghvi - Spouse of Mr. Chandrakant Sanghvi

2 Mr. Rishi Sanghvi - Son of Mr. Chandrakant Sanghvi

3 Ms. Niyoshi Sanghvi - Daughter of Mr. Chandrakant Sanghvi

4 Ms. Ruchi Sanghvi - Daughter of Mr. Chandrakant Sanghvi

5 Mr. Anilkumar Sanghvi - Brother of Mr. Chandrakant Sanghvi

d) Relatives of key management personnel

1 Mrs. Tanuja Desai - Spouse of Ramchandra Desai (upto 1 November 2012)

e) Enterprises over which key management personnel exercise significant influence

1 Jethi Builders and Traders Private Limited

2 Sanghvi Erectors Private Limited

3 Maharashtra Erectors Private Limited

* As gratuity and compensated absences are computed for all the employees in aggregate, the amounts relating to the Key Managerial Personnel cannot be individually identified. However, contribution toward superannuation fund is included as part of managerial remuneration.

** Mr. Chandrakant P. Sanghvi has given personal guarantee up to Rs. 3,500 Lakhs (2013 : Rs. 3,500 Lakhs) and has pledged his 6 lakh (2013 : 6 Lakhs) equity shares towards the loan for which no guarantee commission is paid by the Company.

$ Includes Rs. 79.83 Lakhs (Previous Year Rs. Nil) of managerial remuneration which is subject to the approval of shareholders and Central Government.

# Includes Rs. 15.72 Lakhs (Previous Year Rs. Nil) managerial remuneration subject to the approval of shareholders.

31. Disclosure as per Accounting Standard 15 ( Revised) : Employee Benefits

The following table sets out the status of the Gratuity plan as required under Accounting Standard 15 (Revised)

Note:The estimates of future salary increases take into account inflation, seniority, promotion and other relevant factors on long term basis.

3. Deferral/capitalisation of exchange differences

On 29 December 2011, the Ministry of Corporate Affairs (''MCA'') has issued an amendment to Accounting Standard 11- The Effects of changes in Foreign Exchange Rates and clarification provided vide circular 25/2012 dated 09 August 2012. The amendment permits Companies to defer/capitalise the exchange differences arising on Long Term Foreign Currency Monetary Items.

In accordance with the amendment, the Company has capitalised exchange differences arising on long term foreign currency loans, amounting to Rs. 3,229.02 (2013: Rs. 684.32) to the cost of plant and equipments. There is no exchange loss deferred in ''Foreign Currency Monetary Translation Difference Account'', as there are no other long term foreign currency monetary items.

4. Foreign currency exposures outstanding at the year end

(a) The Company has hedged its foreign currency risk exposure and the forward cover outstanding as at the Balance Sheet date:

5. Segment reporting

The Company is primarily engaged in the business of providing cranes on rental basis. Further all the commercial operations of the Company are based in India. Accordingly, there is no separate reportable segment in accordance with AS 17- Segment Reporting prescribed under the Companies (Accounting Standards) Rules, 2006.


Mar 31, 2013

1. Background

Sanghvi Movers Limited ("SML" or "the Company") was incorporated in 1989. SML is engaged in the business of providing hydraulic and crawler cranes to various industries in the infrastructure sector and has a fleet of 387 medium-to large-size hydraulic trucks mounted telescopic and lattice boom cranes and crawler cranes with lifting capacity ranging from 20 tons to 800 tons. The Company has its corporate office at Pune. The equity shares of the Company are listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

2. Related party disclosures

a) Enterprises exercising significant influence over the company

1 Maharashtra Erectors Private Limited (upto 09 September 2011)

b) Individuals exercising significant influence over the company

1 Mr. Chandrakant Sanghvi

c) Key management personnel

1 Mr. Chandrakant Sanghvi

2 Mr. Ramchandra Desai (upto 1 November 2012)

3 Mr. Sham Kajale

d) Relatives of individuals exercising significant influence over the company

1 Mrs. Mina Sanghvi - Spouse of Mr. Chandrakant Sanghvi

2 Mr. Rishi Sanghvi - Son of Mr. Chandrakant Sanghvi

3 Ms. Niyoshi Sanghvi - Daughter of Mr. Chandrakant Sanghvi

4 Ms. Ruchi Sanghvi - Daughter of Mr. Chandrakant Sanghvi

5 Mr. Anilkumar Sanghvi - Brother of Mr. Chandrakant Sanghvi

e) Relatives of key management personnel exercising significant influence over the Company

1 Mrs. Tanuja Desai - Spouse of Ramchandra Desai (upto 1 November 2012)

f) Enterprises over which key management personnel exercise significant influence

1 Jethi Builders and Traders Private Limited

2 Sanghvi Erectors Private Limited

3 Maharashtra Erectors Private Limited

3. Deferral/capitalisation of exchange differences

On 29 December 2011, the Ministry of Corporate Affairs (''MCA'') has issued an amendment to Accounting Standard 11- The Effects of changes in Foreign Exchange Rates and clarification provided vide circular 25/2012 dated 09 August 2012. The amendment permits Companies to defer/capitalise the exchange differences arising on Long Term Foreign Currency Monetary Items.

In accordance with the amendment, the Company has capitalised exchange differences arising on long term foreign currency loans, amounting to Rs.684.32 (2012: Rs.1,230.01) to the cost of plant and equipments. There is no exchange loss deferred in ''Foreign Currency Monetary Translation Difference Account'', as there are no other long term foreign currency monetary items.

4. Foreign currency exposures outstanding at the year end

(a) The Company has hedged its foreign currency risk exposure and the forward cover outstanding as at the Balance Sheet date:

(b) The following foreign currency receivables/payables balances are not covered by derivative instruments at the Balance Sheet date:

5. Segment reporting

The company is primarily engaged in the business of providing cranes on rental basis. Further all the commercial operations of the company are based in India. Accordingly, there is no separate reportable segment in accordance with AS 17- Segment Reporting prescribed under the Companies (Accounting Standards) Rules, 2006.

6. During the previous year, the company had corrected its accounting practice of recognising certain borrowing costs as cost of fixed assets resulting in the interest expense being higher by Rs. Nil (2012 : Rs.678.66) and consequently depreciation charge being lower by Rs. Nil (2012 : Rs.199.29) for the year with consequent profit before tax being lower by Rs. Nil (2012 : Rs.479.37) on account of the prior period item.

7. Prior period comparatives

Previous years'' comparative figures have been regrouped/reclassified wherever necessary to conform to current year''s presentation.


Mar 31, 2012

1. Background

Sanghvi Movers Limited ("SML" or "the Company") was incorporated in 1989. SML is engaged in the business of providing hydraulic and crawler cranes to various industries in the infrastructure sector and has a fleet of 400 medium to large size hydraulic trucks mounted telescopic and lattice boom cranes and crawler cranes with lifting capacity ranging from 20 tons to 800 tons. The Company has its corporate office at Pune. The equity shares of the Company are listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

2.1 Rights, Preferences and Restrictions Attached to Equity Shares

The Company has only one class of shares referred to as equity shares having a par value of Rs. 2. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends 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. The Board of Directors, in their meeting held on 30th May 2012 proposed a final dividend of Rs. 3 per equity share. The proposal is subject to the approval of shareholders at the ensuing Annual General Meeting . 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 share holding.

a) Term loans from banks in Indian Rupees carry interest rate ranging from 10% to 13.5% p.a. The number of monthly installments payable for these loans are 54 to 96.

b) Foreign Currency term loans from banks carry usance interest or interest rate ranging from 6 months to 1 year LIBOR or EURIBOR plus additional basis points ranging from 120 to 350. These loans are repayable in 360 to 720 days from the date when these loans were availed.

Security

a) Term loans amounting to Rs. 59,527.93 (2011 : Rs. 52,444.73) are secured against cranes/trailers.

b) Term loans amounting to Rs. 3,508.22 (2011 : Rs. 2,229.26) are secured against cranes/trailers and equitable mortgage on land and buildings at Tathawade and Bharuch.

c) Term loans amounting to Rs. 424.77 (2011 : Rs. 731.82) are secured against mortgage on land and buildings at Tathawade and Bharuch.

d) Term loans amounting to Rs. 2,219.51 (2011 : Rs. 4,120.01) are secured against cranes/trailers and personal guarantees given by Chairman and Managing Director, Mr. Chandrakant Sanghvi.

e) Term loans amounting to Rs. 72.24 (2011 : Rs. 56.03) are secured against vehicles purchased out of the term loan.

f) Also refer note 16.

a) Working Capital loans from banks representing cash credit facilities are secured against receivables, personal guarantee of Mr. Chandrakant Sanghvi, Chairman and the Managing Director up to Rs. 3,700, pledge of 5 lacs equity shares of the Company held by Mr. Chandrakant Sanghvi, Chairman and the Managing Director and 1 lac equity shares held by Mrs. Mina Sanghvi. The cash credit facilities are repayable on demand and carry an interest ranging between 12-14% p.a.

b) Loans and Advances from a related party are repayable on demand and carry an interest rate ranging from 12-14 % p.a.

The Company was levied additional custom duty amounting to Rs. 140.59 in the year 1998 on import of certain cranes. The Company had capitalised this amount in the year of procurement of these cranes and had also filed an appeal against the levy of this additional customs duty. Those cranes were subsequently sold in earlier years. In the current year the appeal was decided in favour of the Company and it received a refund.

3. Related Party Disclosures

a) Enterprises Exercising Significant Influence over the Company

1 Maharashtra Erectors Private Limited (upto 09 September 2011)

b) Individuals Exercising Significant Influence over the Company

1 Chandrakant Sanghvi

c) Key Management Personnel

1 Chandrakant Sanghvi

2 Ramchandra Desai

3 Sham Kajale

d) Relatives of Individuals Exercising Significant Influence over the Company

1 Mina Sanghvi - Spouse of Chandrakant Sanghvi

2 Rishi Sanghvi - Son of Chandrakant Sanghvi

3 Niyoshi Sanghvi - Daughter of Chandrakant Sanghvi

4 Ruchi Sanghvi - Daughter of Chandrakant Sanghvi

5 Anilkumar Sanghvi - Brother of Chandrakant Sanghvi

e) Relatives of Key Management Personnel Exercising Significant Influence over the Company

1 Tanuja Desai - Spouse of Ramchandra Desai

f) Enterprises over which Key Management Personnel Exercise Significant Influence

1 Jethi Builders and Traders Private Limited

2 Sanghvi Erectors Private Limited

3 Maharashtra Erectors Private Limited

* As gratuity and compensated absences are computed for all the employees in aggregate, the amounts relating to the Key Managerial Personnel cannot be individually identified.

** Chandrakant Sanghvi has given personal guarantee up to Rs. 59.45 crores and has pledged his 5 lacs equity shares towards the loan for which no guarantee commission is paid by the Company.

** Mina Sanghvi has pledged her 1 lac equity shares towards a loan for which no guarantee commission is paid by the Company.

4. Deferral/Capitalisation of Exchange Differences

On 29 December 2011, the Ministry of Corporate Affairs ('MCA') has issued an amendment to Accounting Standard 11- The Effects of changes in Foreign Exchange Rates. The amendment permits Companies to defer/capitalise the exchange differences arising on Long Term Foreign Currency Monetary Items.

In accordance with the amendment, the Company has capitalised exchange differences arising on long term foreign currency loans, amounting to Rs. 1,230.01 (2011: 83.44) to the cost of plant and equipments. There is no exchange loss deferred in 'Foreign Currency Monetary Translation Difference Account', as there are no other long term foreign currency monetary items.

5. Segment Reporting

The Company is primaraly engaged in the business of providing cranes on rental basis. Further all the commercial operations of the Company are based in India. Accordingly, there is no separate reportable segment in accordance with AS 17- Segment Reporting prescribed under the Companies (Accounting Standards) Rules, 2006.

6. During the year, the Company corrected its accounting practice of recognising certain borrowing costs as cost of fixed assets resulting in the interest expense being higher by Rs. 678.66 (2011 : Nil) and consequently depreciation charge being lower by Rs. 199.29 (2011 : Nil) for the year with consequent profit before tax being lower by Rs. 479.37 (2011 : Nil) on account of the prior period item.

7. Prior Period Comparatives

The financial statements for the year ended 31 March 2011 had been prepared as per the then applicable, pre-revised Schedule VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule VI under the Companies Act, 1956, the financial statements for the year ended 31 March 2012 are prepared as per Revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.

8. The prior year financial statements have been audited by a firm of Chartered Accountants other than B S R & Co.


Mar 31, 2011

1 Contingent Liabilities

a) Claims against the Company not acknowledged as debts – Rs.79.60 Lakhs (previous year Rs.75.60 Lakhs).

b) Guarantees issued by Company's bankers on behalf of the Company for performance of contractual obligations, or as security deposits, or as a condition of tender bids made by the Company, aggregate to Rs.324 Lakhs (previous year Rs.197 Lakhs). Some of them are covered by margins in the form of fixed deposits Rs.22 Lakhs (previous year Rs.2.52 Lakhs) and others by way of counter-guarantee and extension of charge on cranes which are hypothecated to the bank on existing term loans.

c) Bills Receivable which are discounted with bankers - Rs.2,801.33 Lakhs (previous year Rs.572.23 Lakhs).

d) Letters of Credit issued by Banks in foreign currencies for which goods were yet to be received on date of Balance Sheet US $ 24,41,750; Euro 43,04,996; Yen 90,08,569.

e) Income Tax Assessment demands contested in appeal – Rs.296.85 lakhs (previous year Rs.296.85 lakhs). The contested demand arises due to issues which do not warrant a provision to be made.

f) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs.Nil (previous year Rs.Nil Lakhs).

2 Secured Loans - Nature of Security

a) Term Loans from State Bank of India are secured by Hypothecation of Cranes and additions thereto which are funded there from and also collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans.

b) Term Loans from ING Vysya Bank are secured by Hypothecation of Cranes, Prime Movers & Trailers which are funded there from besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans.

c) Term Loans from ICICI Bank Ltd and Letters of Credit accepted by the bank are secured by Hypothecation of Cranes which are funded there from besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans.

d) Term Loans from The Saraswat Co-operative Bank Ltd are secured by Hypothecation of the respective Cranes and Vehicles, in aggregate, as well by Equitable Mortgage of certain Lands and Immovable properties and by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans.

e) Term Loans from Axis Bank and Letters of Credit accepted by the bank are secured by Hypothecation of the Cranes funded there from besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans. One of the Term loan is personally guaranteed by the Managing Director.

f) Term Loans from HDFC Bank are secured by Hypothecation of the Cranes funded there from.

g) Term Loans from Corporation Bank are secured by Hypothecation of the Cranes funded there from besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans with some loans being personally guaranteed by the Managing Director.

h) Term Loans from State Bank of Hyderabad are secured by Hypothecation of the Cranes funded there from with besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans. Some loans being personally guaranteed by the Managing Director.

i) Term Loans from Bank of Baroda and Letters of Credit accepted by the bank are secured by Hypothecation of the Cranes and additions thereto funded there from besides being collaterally secured by Hypothecation of certain Cranes funded by the Bank in respect of its previous Term Loans. One of the Term Loan is personally guaranteed by the Managing Director.

j) Term Loans from Bank of India are secured by Hypothecation of the Cranes or additions thereto funded there from.

k) Cash Credit facilities availed from Dena Bank are secured against the Company's receivables. These are personally guaranteed by the Managing Director up to Rs.37 Crores.

l) Principal amount of secured Term Loans due for repayment within next 12 months - Rs.162.44 Crores (previous year Rs.148.52 Crores).

3 The Company has opted to follow the amended accounting standard rules with respect to change in foreign exchange rates by capitalising the gain or loss on foreign currency loans used for acquiring fixed assets to their cost. Accordingly, the cost of fixed assets has been adjusted accordingly.

4 Confirmations from Debtors of balances due to the Company are generally not received. In the management's view in the ordinary course of its business, the Company shall be able to realise the Debtors at the amounts they are stated.

5 Loans and Advances include Rs.13.88 Lakhs (previous year Rs.14.13 Lakhs) due from Officers of the Company. Aggregate of Maximum amounts due during the year was Rs.22.45 Lakhs (previous year Rs.19.42 Lakhs).

6 Managerial Remuneration :

a) To Mr. C. P. Sanghvi, Chairman and Managing Director comprises of Salary & Allowances Rs.144 Lakhs, Commission Rs.119 Lakhs, Payments towards (i) residential Electricity and Club fees & charges Rs.3.05 Lakhs, (ii) Medical Expenses Rs.0.14 lakh (iii) Contribution to Superannuation Fund Rs.37.26 Lakhs. Perquisite value of Car provided as per Income Tax Rules Rs.0.40 lakh.

b) To Mr. R. S. Desai, Executive Director, comprises of Salary & Allowances Rs.25.56 Lakhs, Payments towards (i) Medical Expenses Rs.0.15 lakh (ii) Contribution to Superannuation Fund 2.74 Lakhs. Perquisite value of Car provided as per Income Tax Rules Rs.0.26 lakhs.

c) To Mr. S. D. Kajale, Executive Director & CFO, comprises of Salary & Allowances Rs.23.04 Lakhs, Payments towards (i) Medical Expenses Rs.0.17 lakh and Contribution to Superannuation Fund Rs.2.47 Lakhs. Perquisite value of Car provided as per Income Tax Rules is Rs.0.26 lakhs.

7 Related Party Disclosures as per Accounting Standard 18 -

a) Key Management Personnel of the Company:

(i) Mr. C. P. Sanghvi, Managing Director,

(ii) Mr. R. S. Desai, Executive Director, and

(iii) Mr. S. D. Kajale Executive Director & CFO

b) Enterprises under control of Key Management Personnel :

(i) Maharashtra Erectors Private Limited (MEPL)

(ii) Sanghvi Hi-Lift Private Limited (SHPL)

(iii) Jethi Builders & Traders Private Limited (JBTPL)

c) Transactions with related parties :

(i) Remuneration to Key Management Personnel is stated at (7) above.

(ii) For services and facilities availed from MEPL Crane Hire Charges Rs.72.75 Lakhs and Trailer Hire Charges Rs.27 Lakhs

(iii) Advance from MEPL – at the beginning of the year – Nil, received Rs.740 lakhs and refunded Rs.100 lakhs.

(iv) Interest Paid to MEPL – Rs.43.40 lakhs.

(v) Sitting Fees Paid to Mrs Mina C. Sanghvi – Rs.1.00 lakhs

d) Mr C. P. Sanghvi has guaranteed some of the secured loans borrowed by the Company for which no guarantee commission is paid to him.

8 Employee Benefit Plans :

Defined Contribution Plans -

The Company makes Provident Fund, Pension Fund and Superannuation Fund contributions to defined contribution retirement benefit plans for qualifying employees. The Company charged Rs.18.41 Lakhs (previous year Rs.14.72 Lakhs) to the Profit & Loss Account towards Provident Fund and Pension Fund contributions and Rs.50.77 Lakhs (previous year Rs.49.32 Lakhs) towards Superannuation Fund contributions.

Defined Benefit Plans –

The Company makes annual contributions to the Employees' Group Gratuity cum Life Assurance Scheme of Life Insurance Corporation of India, a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested 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. Vesting occurs upon completion of five years of service, except in case of death of permanent disability.

9 Foreign Currency Transactions :

a) Imports on CIF basis during the year in respect of :

Components and Spare Parts - Rs.685.67 Lakhs (previous year Rs.483.60 Lakhs) Capital Goods – Rs.26,381.24 Lakhs (previous year Rs.12,775.53 Lakhs)

b) Expenditure incurred in foreign currency during the year – Rs.27.32 Lakhs (previous year Rs.15.34 Lakhs)

c) Remittance of Dividends – Rs.132 Lakhs (previous year – Rs.88 lakhs)

10 As per Accounting Standard 17, the Company's Windmills are not a reportable segment and Operations from Cranes is the only reportable segment.

11 Installed Capacity – Wind Power Generation – 5.05 MW and Generation of Electricity – 55.29 Lakhs Kwh (previous year 78.32 Lakhs Kwh)

12 Previous year's figures have been regrouped wherever necessary.


Mar 31, 2010

1 Contingent Liabilities

a) Claims against the Company not acknowledged as debts - Rs. 75.60 Lakhs (previous year Rs. 42.14 Lakhs).

b) Guarantees issued by Companys bankers on behalf of the Company for performance of contractual obligations, or as security deposits, or as a condition of tender bids made by the Company, aggregate to Rs. 197 Lakhs (previous year Rs. 483 Lakhs). Some of them are covered by margins in the form of fixed deposits Rs. 2.52 Lakhs (previous year Rs. 26.46 Lakhs) and others by of counter-guarantee and extension of charge on cranes which are hypothecated to the bank on existing term loans.

c) Bills Receivable which are discounted with bankers are Rs. 572.23 Lakhs (previous year Rs. 994.40 Lakhs).

d) Income Tax Assessment Order for financial year 2006-07 was received in December, 2009 raising a rectified demand of Rs. 303.68 Lakhs. Of the same Rs. 6.83 Lakhs has been accepted and paid. Balance demand of Rs. 296.85 Lakhs though contested in an appeal is being partly adjusted against various refunds receivable and was partly paid. The contested demand arises due to issues which do not warrant a provision to be made.

e) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. Nil (previous year Rs. 3,483 Lakhs).

2 Secured Loans :- Nature of Security

a) Term Loans from State Bank of India are secured by Hypothecation of Cranes and additions thereto which are funded there from and also collaterally secured by way of Mortgage of certain Windmills and by Hypothecation of certain Cranes. Some of the loans are also personally guaranteed by the Managing Director.

b) Term Loans from ING Vysya Bank are secured by Hypothecation of Cranes which are funded there from besides being collaterally secured by Hypothecation of certain Cranes. Some of the loans are also personally guaranteed by the Managing Director.

c) Term Loans from ICICI Bank Ltd are secured by Hypothecation of Cranes and Tractor Trailers which are funded there from besides being collaterally secured by Hypothecation of certain Cranes. Some of the loans are also personally guaranteed by the Managing Director.

d) Term Loans from The Saraswat Co-operative Bank Ltd are secured by Hypothecation of the respective Cranes and vehicle, in aggregate, as well by Equitable Mortgage of certain Lands and Immovable properties and by Hypothecation of certain Cranes. Some of the loans are also personally guaranteed by the Managing Director.

e) Term Loans from Axis Bank are secured by Hypothecation of the Cranes funded there from with some loans being personally guaranteed by the Managing Director.

f) Term Loans from HDFC Bank are secured by Hypothecation of the Cranes funded there from.

g) Term Loans from Corporation Bank are secured by Hypothecation of the Cranes funded there from with some loans being personally guaranteed by the Managing Director.

h) Term Loans from State Bank of Hyderabad are secured by Hypothecation of the Cranes funded there from with some loans being personally guaranteed by the Managing Director.

i) Term Loans from Bank of Baroda are secured by Hypothecation of the Cranes or additions thereto funded there from with some loans being personally guaranteed by the Managing Director.

j) Term Loans from Bank of India are secured by Hypothecation of the Cranes or additions thereto funded there from.

k) Cash Credit facilities availed from Dena Bank are secured against the Companys receivables. These are personally guaranteed by the Managing Director upto Rs. 35 Crores.

l) Principal amount of secured Term Loans due for repayment within next 12 months - Rs. 14,852 Lakhs.

3 Stores and spare parts for repairs and maintenance of cranes and trailers were being expensed out on purchase as consumables. Management considered it expedient to take an inventory of spare parts at the year end and has valued it at cost resulting in an increase in Profit before Tax by Rs. 2,88,80,340.

4 The Company has opted to follow the amended accounting standard rules with respect to change in foreign exchange rates by capitalising the gain or loss on foreign currency loans used for acquiring fixed assets to their cost. Accordingly, cost of fixed assets has been reduced by gain of Rs. 149.10 Lakhs.

5 Confirmations from Debtors of balances due to the Company are generally not received. In the managements view in the ordinary course of its business, the Company shall be able to realise the Debtors at the amounts they are stated.

6 Loans and Advances include Rs. 14.13 Lakhs (previous year Rs. 8.33 Lakhs) due from Officers of the Company. Aggregate of Maximum amounts due during the year was Rs. 19.42 Lakhs (previous year Rs. 15.08 Lakhs).

7 Managerial Remuneration :

a) To Shri C. P. Sanghvi, Chairman and Managing Director comprises of Salary and Allowances Rs. 144 Lakhs, Commission Rs. 133 Lakhs, Payment of residential Electricity and Club fees & charges Rs. 1.94 Lakhs, Reimbursement of Medical Expenses 0.67 Lakhs, Contribution to Superannuation Fund Rs. 37.26 Lakhs. The perquisite value of one Car provided as per Income Tax Rules is Rs. 0.40 Lakhs.

b) To Shri R. S. Desai, Executive Director, comprises of Salary & Allowances Rs. 21.92 Lakhs, Performance Linked Incentive Rs. 6 Lakhs, Reimbursement of Medical Expenses Rs. 0.15 Lakhs and Contribution to Superannuation Fund Rs. 2.28 Lakhs. The perquisite value of one Car provided as per Income Tax Rules is Rs. 0.22 Lakhs.

c) To Shri S. D. Kajale, Executive Director & CFO, comprises of Salary & Allowances Rs. 19.73 Lakhs, Performance Linked Incentive Rs. 5.60 Lakhs, Reimbursement of Medical Expenses Rs. 0.15 Lakhs and Contribution to Superannuation Fund Rs. 2.05 Lakhs. The perquisite value of one Car provided as per Income Tax Rules is Rs. 0.22 Lakhs.

8 Related Party Disclosures as per Accounting Standard 18 :

a) Key Management Personnel of the Company : (i) Mr. C. P. Sanghvi, Managing Director,

(ii) Mr. R. S. Desai, Executive Director, and (iii) Mr. S. D. Kajale Executive Director & C.F.O.

b) Enterprises under control of Key Management Personnel : (i) Maharashtra Erectors Private Limited (MEPL)

(ii) Sanghvi Hi-Lift Private Limited (SHPL)

(iii) Jethi Builders & Traders Private Limited (JBTPL)

c) Transactions with related parties :

i) Remuneration to Key Management Personnel is stated at (8) above.

ii) For services and facilities availed from MEPL, Crane Hire Charges Rs. 111.05 Lakhs and Trailer Hire Charges Rs. 21 Lakhs.

iii) Advance to MEPL - at the beginning of the year Rs. 70 Lakhs, received back Rs. 70 Lakhs, at the end of the year Rs. Nil.

iv) Interest Received from MEPL – Rs. 2.82 Lakhs.

v) Advance from MEPL - at the beginning of the year - Nil, received Rs. 435 Lakhs and refunded Rs. 435 Lakhs.

vi) Interest Paid to MEPL – Rs. 12.44 Lakhs.

vii) S a l ary to Niyoshi C. Sanghvi – Rs. 3.17 Lakhs.

viii) Sitting Fees Paid to Mrs. Mina C. Sanghvi – Rs. 0.70 Lakhs.

d) Mr. C. P. Sanghvi has guaranteed secured loans borrowed by the Company for which no guarantee commission is paid to him.

9 Employee Benefit Plans :

Defined Contribution Plans -

The Company makes Provident Fund and Superannuation Fund contributions to defined contribution retirement benefit plans for qualifying employees. The Company charged Rs. 14.72 Lakhs (previous year Rs. 14.75 Lakhs) to the Profit & Loss Account towards Provident Fund contribution and Rs. 49.32 Lakhs (previous year.40.48Lakhs) towards Superannuation Fund contributions.

Defined Benefit Plans -

The Company makes annual contributions to the Employees Group Gratuity cum Life Assurance Scheme of Life Insurance Corporation of India, a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to vested 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. Vesting occurs upon completion of five years of service, except in case of death or permanent disability.

10 Foreign Currency Transactions :

a) Imports on CIF basis during the year in respect of :

Components and Spare Parts - Rs. 483.60 Lakhs (previous year Rs. 489.75 Lakhs)

Capital Goods - Rs. 12,775.53 Lakhs (previous year Rs. 19,622.45 Lakhs)

b) Expenditure incurred in foreign currency during the year - Rs. 15.34 Lakhs (previous year Rs. 20.65 Lakhs)

c) Remittance of Dividends - Rs. 88 Lakhs (previous year Rs. 132 Lakhs)

11 As per Accounting Standard 17, the Companys Windmills are not a reportable segment and Operations from Cranes is the only reportable segment.

12 Installed Capacity - Wind Power Generation - 5.05 MW and Generation of Electricity - 78.32 Lakhs Kwh (previous year 78.01 Lakhs Kwh)

13 Previous years figures have been regrouped wherever necessary.

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