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Notes to Accounts of Shekhawati Poly Yarn Ltd.

Mar 31, 2015

Note 1 : Corporate Information

Shekhawati Poly-Yarn Limited (the Company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India (BSE & NSE). The Company is principally engaged in the manufacturing of Texturising Yarn, Twisting Yarn and Knitted Fabrics. The Company caters to both domestic and international markets.

2 The Company is consistently following the accounting of excise duty on closing stock of finished goods on clearance of finished goods from the factory and such treatment has no impact on Statement of Profit & Loss for the year.

3 In the opinion of the Board the Current Assets (other than those doubtful & provided for) and Loans and Advances are approximately of the value stated and realizable in the ordinary course of business. The Provisions of all known liabilities is adequate and not in excess of the amount reasonably necessary.

Note: Company has obtained license under Export Promotion Capital Goods Scheme (EPCG) for purchase of capital goods on zero percent custom duty. Under the EPCG the Company needs to fulfill certain export obligations, failing which, it is liable for payment of custom duty . Expor t Ob ligations at the end of current financial year is Rs. 25,438.56 lacs (includes Rs. 21,265.03 lacs towards average maintainable exports) (PY Rs. 7315.10 lacs) which needs to be fulfilled within 6/8 years from the date of purchase of respective license.

4 : Commitments

Estimated amount of contracts remaining to be executed on capital account (net of advances) and not provided for is Rs. 8,189.61 lacs (PY: Rs. Nil/-).

5 The Company has revised depreciation rates on fixed assets w.e.f. April 01, 2014 as per the useful life specified in Schedule II of the Companies Act, 2013. As prescribed in Schedule II, an amount of Rs 5.22 lacs (net of deferred tax) has been charged to the opening balance of retained earnings for the assets in respect of which the remaining useful life is NIL as on April 01, 2014 and in respect of other assets on that date, depreciation has been calculated based on the remaining useful life of those assets. Had the Company continued with the previously applicable rates mentioned in Schedule XIV of the Companies Act, 1956, charge for depreciation for the year would have been higher and net profit would have been lower by Rs. 97.41 lacs respectively.

6 Segment Reporting

In accordance with the requirements of Accounting Standard 17 "Segmental Reporting", the Company's business consist of one reportable segment of textile business, hence no separate disclosure pertaining to attributable Revenues, Profits, Assets, Liabilities, Capital employed are given.

7 Figures of previous year have been re-grouped, reclassified and/or rearranged as and wherever necessary.


Mar 31, 2014

Note 1 : Corporate Information

Shekhawati Poly-Yarn Limited (the Company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on two stock exchanges in India (BSE & NSE). The Company is principally engaged in the manufacturing of Texturising Yarn, Twisting Yarn and Knitted Fabrics. The Company caters to both domestic and international markets.

2 The Company is consistently following the accounting of excise duty on closing stock of finished goods on clearance of finished goods from the factory and such treatment has no impact on Statement of Profit & Loss for the year.

3 In the opinion of the Board the Current Assets (other than those doubtful & provided for) and Loans and Advances are approximately of the value stated and realizable in the ordinary course of business. The Provisions of all known liabilities is adequate and not in excess of the amount reasonably necessary.

4 Contingent Liabilities

a) Outstanding Bank Guarantee Rs. 232.50 Lakhs (P. Y. Rs. 220.00 Lakhs)

b) Outstanding Letter of Credit Rs. 953.51 Lakhs ( P. Y. Rs. 520.97 Lakhs )

c) The Company has purchased Machinery under the EPCG Scheme whereby it has obligation of exporting goods on FOB basis amounting to 8 times the Import duty saved within a period of 8 years. The amount of duty saved till 31st March, 2014 is Rs. 1749.67 Lakhs (P.Y. Rs. 1749.67 Lakhs). Accordingly, the Company has exported goods amounting to Rs. 10,619.65 Lakhs (P.Y. Rs. 5,637.46 Lakhs) on FOB Basis and export obligations as on 31st March 2013 is Rs. 7,315.11 Lakhs (P.Y. Rs. 8,359.88 Lakhs).

5 Segment Reporting

In accordance with the requirements of Accounting Standard 17 "Segmental Reporting", the Company''s business consist of one reportable segment of textile business, hence no separate disclosure pertaining to attributable Revenues, Profits, Assets, Liabilities, Capital employed are given.

6 Figures of previous year have been re-grouped, reclassified and/or rearranged as and wherever necessary.

7 Figures less than Rs.500/- have been shown at actual wherever statutory required to be disclosed since figures have been rounded off to the nearest thousands.


Mar 31, 2013

1 Corporate Information

Shekhawati Poly-Yarn Limited (the Company) is a public company domiciled in India and incorporated under the provisions of the Companies Act, 1956. Its shares are listed on both the principal stock exchanges in India. The Company is engaged in the manufacturing and selling of Texturising Yarn, Twisting Yarn and knitted Fabrics. The Company caters to both domestic and international markets.

2 Provision for taxation for the accounting year has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with Section 115 JB of the Income Tax Act, 1961. Considering the future profitability and taxable positions in the subsequent years, the Company has recognized "MAT credit entitlement "of Rs. 141.64 Lacs (P.Y. Rs. 129.10 Lacs) as an asset by crediting to the Statement of Profit and Loss an equivalent amount and included the same under "Long term Loans and Advances "in accordance with the Guidance Note on "Accounting for credit available in respect of Minimum Alternate Tax under Income Tax Act, 1961" issued by the Institute of Chartered Accountants of India.

* Pursuant to approval of the members dated March 15, 2013 through postal ballots, 1 Equity Share having face value of Rs. 10 each has been subdivided into 10 Equity Shares of Re. 1 each. Hence, Previous year Basic and Diluted earning per share has been restated accordingly.

3 The Company is consistently following the accounting of excise duty on closing stock of finished goods on clearance of finished goods from the factory and such treatment has no impact on Statement of Profit & Loss for the year

4 In the opinion of the Board the Current Assets (other than those doubtful & provided for) and Loans and Advances are approximately of the value stated and realizable in the ordinary course of business. The Provisions of all known liabilities is adequate and not in excess of the amount reasonably necessary.

5 Few of the balances appearing under the head of Trade receivables, Trade Payables and Loans and Advances are subject to confirmation and reconciliation. Consequential adjustment thereof, if any, will be given effect into the books of accounts in the year of such adjustment. The management, however, does not expect any material adjustment.

6 Contingent Liabilities

a) Outstanding Bank Guarantee Rs. 220 Lacs (P. Y. Rs. 248.65 Lacs)

b) Outstanding Letter of Credit Rs. 520.97 Lacs (P. Y. Rs. 489.37 Lacs)

c) The Company has purchased Machinery under the EPCG Scheme whereby it has obligation of exporting goods on FOB basis amounting to 8 times the Import duty saved within a period of 8 years. The amount of duty saved till March 31, 2013 is Rs.1749.67 Lacs (P.Y. Rs.1245.82 Lacs ). Accordingly, the Company has exported goods amounting to Rs. 5637.46 Lacs (P.Y. Rs.3947.01 Lacs) on FOB Basis and export obligations as on March 31, 2013 is Rs. 8359.88 Lacs (P.Y. Rs.6019.56 Lacs).

d) Estimated amount of Contracts remaining to be executed on Capital Account Rs. 829.86 Lacs (Net of Advances) (P. Y. Rs. 1252.55 Lacs).

e) Excise Duty refund contested in appeal Rs. Nil (P.Y 159.02 Lacs)

7 Segment Reporting

In accordance with the requirements of Accounting Standard 17 ''''Segmental Reporting", the Company''s business consist of one reportable segment of textile business, hence no separate disclosure pertaining to attributable Revenues, Profits, Assets, Liabilities, Capital employed are given.

8 During the year, the Company has passed Special Resolution through postal ballot on March 15, 2013 for change of registered office from Express Zone,"A" wing, Unit No. 1102/1103, Patel Vatika, Off.Western Express Highway, Malad (East), Mumbai, Maharashtra to Plot No. 185/1, Naroli Village, Near Kanadi Phatak, Dadra & Nagar Haveli (Union Territory). The Company is in the process of complying with the various ROC formalities in this regard.

9 Figures of previous year have been re-grouped, reclassified and/or rearranged as and wherever necessary.

10 Figures less than Rs. 500/- have been shown at actual wherever statutory required to be disclosed since figures have been rounded off to the nearest thousands.


Mar 31, 2010

Notes on Accounts

1. Liabilities in respect of Gratuity & Bonus are accounted for on Payment basis which is not in conformity with Accounting Standard (AS) 15 (Revised 2005) on Employee Benefits as notified by the Companies Accounts Standard, Rule 2006 which requires that Gratuity and Bonus Liabilities be accounted for on accrual basis.

2. Company is consistently following the accounting of excise duty on closing stock of finished goods on clearance of finished goods from the factory and such treatment has no impact on Profit & loss for the year.

3. Purchases are inclusive of Cenvat after deducting purchase return, discount, rebate and Incentive, if any.

4. Sales inclusive of Excise Duty after deducting Sales Return and Discount if any.

5. In the opinion of the board the Current Assets, Loans & Advances are approximately of the value stated and realizable in the ordinary course of business. The Provision of all known liabilities is adequate and not in excess of the amount reasonably necessary.

6. The balances appearing under the head sundry debtors, loans and advances, current liabilities are subject to confirmation and reconciliation. Consequential adjustment thereof, if any, will be given effect into the books of accounts in the year of such adjustment.

7. There are no dues to the Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet Date. This information regarding Micro Small and Medium Enterprises has been determined on the basis of information available with the Company.

8. Contingent liabilities not provided for:

a) Outstanding Bank Guarantee Rs. 49.55 lacs (Previous year Rs. 42.50 lacs).

b) The Company has purchased Machinery under the EPCG Scheme whereby it has obligation of exporting goods on FOB basis amounting to 8 times the Import duty saved within a period of 8 years. The amount of duty saved till 31st March, 2010 is Rs. 593.36 lacs (P.Y. Rs.367.89 lacs). Accordingly the Company has exported goods amounting to Rs. 236.02 lacs ( P.Y. 89.20 lacs) on FOB Basis and export obligation as on 31-03-2010 is Rs. 4510.89 lacs (P.Y.Rs.2853.91 lacs).

c) Estimated amount of Capital contract remaining to be executed on capital account Rs. 791.44 lacs (Net of Advances) (Previous Year Rs.304.25 lacs).

9. Taxes on Income

Provision for taxation for the accounting year has been computed on the basis of Minimum Alternate Tax (MAT) in accordance with I section 115 JB of the Income Tax Act, 1961. Considering the future profitability and taxable positions in the subsequent years, the I Company has recognized "MAT credit entitlement "of Rs.9.90 lacs (P.Y. Rs. 30.37 lacs) as an assets by crediting to the Profit and Loss Account an equivalent amount and included under "Loans and Advances " in accordance with the Guidance Note on "Accounting for credit available in respect of Minimum Alternate Tax under Income Tax Act, 1961" issued by the Institute of Chartered Accountants of India

In terms of Accounting Standard on "Accounting for Taxes on Income" (AS 22) the company has recognized Deferred Tax Liability (net) amounting to Rs.72.13 lacs (P.Y. Rs. 60.68 lacs) for the year ended on 31st March, 2010 in the Profit & Loss Account.

11. Related Party Disclosures

As required under Accounting Standard 18 "Related Party Disclosure" (AS-18), following are details of transactions during the year with the related parties of the Company as defined in AS 18:

I) For the year ended 31st March, 2010

a) Key Management Personnels and their Relatives :

Shri Ramniranjan Ruia Chairman

Shri Mukesh Ruia Managing Director

b) Name of the enterprises having same Key Management Personnel and / or their relatives as the reporting enterprise with whom the Company has entered into transactions during the year.

Ruia Rayons Private Limited

Note : Related Parties are as disclosed by the Management and relied upon by the auditors There is no amount written off / written back due from / to related parties

II) For the year ended 31st March, 2009

a) Key Management Personnels and their Relatives :

Shri Ramniranjan Ruia Ch airman

Shri Mukesh Ruia M a naging Director

Smt. Kalpana M. Ruia Wife of Mukesh Ruia

b) Name of the enterprises having same Key Management Personnel and / or their relatives as the reporting enterprise with whom the Company has entered into transactions during the year.

Ruia Rayons Private Limited

Mukesh Silk Mills

Ruia Silk and Synthetics Private Limited

11. Post Balance Sheet Event

a) The Company has been converted into a Public Limited Company and accordingly the name of the Company has been changed to Shekhawati Poly Yarn Limited from Shekhawati Poly Yarn Private Limited and fresh certificate of incorporation dated 19th April, 2010 has been received from Registrar of Company, Maharashtra.

b) The Company has allotted 57,72,165 equity shares as bonus shares of Rs. 10/- each in the ratio of 7 equity shares for every 2 equity shares held as per the resolution passed at the Meeting of Board of Directors held on 17th April 2010

12. Segmental Information:

In accordance with the requirements of Accounting Standard 17 ''''Segmental Reporting", the Company''s business consist of one reportable segment of textile business, hence no separate disclosure pertaining to attributable Revenues, Profits, Assets, Liabilities, Capital employed are given.

13. Previous years figures have been regrouped, reclassified and rearranged wherever considered necessary.

 
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