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Notes to Accounts of Shilchar Technologies Ltd.

Mar 31, 2014

1. General Information of the Company.

SHILCHAR TECHNOLOGIES LIMITED ("the Company"), incorporated in the year 1986 is a Vadodara, Gujarat, based ISO 9001:2008 profit making and dividend paying Public Limited Company engaged in the business of manufacturing of "Distribution & Power Transformers" as well "Electronics & Telecommunication Transformers."

The Company made its public issue in the year 1995 and is listed on Mumbai Stock Exchange and Vadodara Stock Exchange.

2. The Company has a single class of equity shares which are having par value of Rs. 10 per equity share. All shares rank pari passu with reference to all rights relating thereto. Each Shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportions to their shareholding.

Micro and Small Enterprises:

With reference to amounts shown as payable to Micro, Small and Medium Enterprises, the information has been compiled in respect of parties to the extent they could be identified as Micro, Small and Medium Enterprises on the basis of information collected and available with the Company and same has been relied upon by the auditors. The Company deals with various Micro Small and Medium Enterprises on mutually accepted terms and conditions. No interest is payable if the mutual terms are adhered to by the Company.

Accordingly, no interest has been paid during the year and further no provision for interest payable to such units is required or has been made under Micro, Small and Medium Enterprises Development Act, 2006. Hence, information as required under Schedule VI of the Companies Act, 1956 relating to delayed payments and interest on delayed payments to Micro, Medium and Small Enterprises has not been compiled and presented.

3. Sundry Creditors and Sundry Debtors are as per books and have not been corroborated by circulation / confirmation of balances / reconciliation of accounts. Confirmations of parties concerned, for the amount receivable / due to them as per accounts of the company, are under process of reconciliation and adjustments required, if any, will be made as and when the accounts are settled.

4. In the opinion of the Board, the Current Assets, Loans and Advances which are considered good are expected to realize at least the amount at which they are stated, if realized in the ordinary course of business. Further, in the opinion of the Board, provision of all known liabilities has been adequately made in the accounts and as per management experience and estimates no additional provision is required for guarantees and warranties, liquidated damages etc

5. Contingent Liabilities (to the extent not provided for)

Claims against the Company not acknowledged as debt:

Service Tax Credits Reversed under Protest-Rs. 6,52,179/- (Decision Pending).

VAT Demand on Assessment for 2007-08 Rs.1,08,366/- towards disallowance of Input Tax Credit for the purchases from cancelled dealers and Rs.32,510/- as penalty on it.

CST Demand on Assessment for the year 2007-08 Rs.4,45,455/- towards CST on Freight charged in Invoices as well interest there on.

(Company has preferred Second Appeal at Tribunal - Ahmedabad for both the disallowances after fully paying both the demand, hearing is awaited.)

CST Demand on Assessment for 2008-09 Rs. 3,82,863/-

(Against above demand, the Company has filed appeal before Jt. Commissioner of Commercial Tax (Appeals) against the Assessment Order which is pending.)

CST Demand on Assessment for 2009-10 Rs. 19,58,175/-

(Against above demand, the Company has filed appeal before Jt. Commissioner of Commercial Tax (Appeals) against the Assessment Order which is pending.)

Legal Case Filed against Company by its Creditors-Rs.22,900/-

Legal Case Filed by Company against Debtors with amount still outstanding in books-Rs.1,98,085/- Guarantees:

The Company has given Corporate Guarantees for Performance of Products to the tune of Rs.2,42,77,391/- (p.y. Rs.2,42,77,391/-) to EPC Customers being Private Companies.

Bank Guarantees outstanding as on 31st March, 2014, amounted to Rs 16,51,78,896/- (p.y. Rs.17,37,74,365/-) and Letters of Credit outstanding as at 31st March 2014, amounted to Rs.7,31,82,256/- (p.y. Rs. 9,69,49,897/-) against which the company has kept the Margin Money in the form of Fixed Deposit worth Rs. 2,69,13,734/- (p.y. Rs. 2,95,73,729/-).

6. Commitments (to the extent not provided for)

Estimated amt. of contracts remaining to be executed on capitalaccount : Nil (p.y. Nil)

Other Commitments : Nil

7. Proposed Dividend :

Amount of Rs. 1.00 per Equity Share aggregating to Rs. 38,13,400 is being proposed as dividend on equity shares. There are no arrears of dividends.

Post Employment Benefits:

Provident Fund dues amounting to Rs. 7,78,314 (PY Rs. 8,00,846) paid during the year being defined contributions has been charged to the Statement of Profit and Loss.

The value of obligation towards entitlement of employees accumulating earned leave and eligibility of compensation or encashment of the same is determined on the basis of the expected amount required to be paid as a result of actual unused entitlement standing to the credit of the employees as at end of the year based on current salary standards measured by actuarial valuation using projected unit credit method as at the balance sheet date. Accordingly a sum of Rs. 12,92,660 (p.y. Rs. 9,71,463) has been determined as obligation as at the year end. The current year cost including actuarial gains / losses of Rs. 8,38,301 (p.y Rs. 4,01,847/-) has been charged to the Statement of Profit and Loss Account and the benefit pay out of Rs. 5,17,104/- (p.y Rs. 3,89,037/-) has been deducted from the overall liability which is unfunded.

The Company has a defined benefit gratuity plan. As per the Payment of Gratuity Act, 1972, every employee who has completed five or more years of service is eligible for gratuity @ 15 days salary (last drawn) for every completed year of service with an overall ceiling of Rs. 10,00,000 (PY Rs. 10,00,000) at the time of separation from the Company or retirement whichever is earlier. The Company has taken a Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India ( a qualifying policy ) and makes annual contributions to the same to create a fund to meet this defined benefit gratuity obligation.

8. Segment Reporting

With respect to Accounting Standard-17, the Management of the Company is of the view that the products offered by the Company are in the nature of Transformers and its related products, having the same risks and returns, same type and class of customers and regulatory environment. Hence, the business of production and sale of transformers and its related products belong to one business segment only.

9. Impairment of Assets:

As a tool to measure to the value of fixed assets, the Company has considered the technical Valuation carried out by expert in the recent. In terms of the valuation report and further in absence of any indications, external or internal, as to any probable impairment of assets, no provision has been made for the same during the year under report. However, Valuation relating to Delhi Office and Furniture has not been obtained and hence it is not possible to determine the impairment, if any, on account of those assets.

10. The Company did not have any forward contracts outstanding as at the year and hence no need for recognizing any mark- to-market losses in term of ICAI announcement dtd. 29th March, 2008 on "Accounting for Derivatives"

11. The Company has acquired a new land for future expansion purposes in the preceding financial year. The company has incurred various expenditures in relation to the said land for the purpose of the development of the same. The development cost incurred in respect of the said land has been capitalized.

12. The Company owns a Windmill which produces power. The Units of Power generated from the Windmill are setoff against the monthly power bill of the Company. Consequently, the power cost of the Company for the year under report is net of the setoff of the power units generated from the Windmill

13. There are no amounts pending to be transferred to the Investors Education and Protection Fund as at the end of the year.

14. The figures in respect of previous year have been regrouped / recast wherever necessary to confirm to the current year''s classification.


Mar 31, 2013

1. General Information of the Company.

SHILCHAR TECHNOLOGIES LIMITED ("the Company"), incorporated in the year 1986 is a Vadodara, Gujarat, based ISO 9001:2008 profit making and dividend paying Public Limited Company engaged in the business of manufacturing of "Distribution & Power Transformers" as well "Electronics & Telecommunication Transformers." The Company made its public issue in the year 1995 and is listed on Mumbai Stock Exchange and Vadodara Stock Exchange.

2. Sundry Creditors and Sundry Debtors are as per books and have not been corroborated by circulation / confirmation of balances / reconciliation of accounts. Confirmations of parties concerned, for the amount receivable / due to them as per accounts of the company, are under process of reconciliation and adjustments required, if any, will be made as and when the accounts are settled.

3. In the opinion of the Board, the Current Assets, Loans and Advances which are considered good are expected to realise at least the amount at which they are stated, if realized in the ordinary course of business. Further, in the opinion of the Board, provision of all known liabilities has been adequately made in the accounts and as per management experience and estimates no additional provision is required for guarantees and warranties, liquidated damages etc

4. Contingent Liabilities (to the extent not provided for)

Claims against the Company not acknowledged as debt : Service Tax Credits Reversed under Protest–Rs. 652179/- (Decision Pending) VAT/CST Demand on Assessment for 2007-08 Rs. 2455370 CST Demand on Assessment Order for 2008-09 – Rs. 382863/- (Against both of the above demands, the Company has filed appeal before Jt. Commissioner of Commercial Tax (Appeals) against the Assessment Order which is pending.)

Legal Case Filed against Company by its Creditors-Rs.1,64,340/- Legal Case Filed by Company against Debtors with amount still outstanding in books-Rs.78,780/- Guarantees :

The Company has given Corporate Guarantees for Performance of Products to the tune of Rs.2,42,77,391/- (p.y. Rs.1,38,97,990/-) to EPC Customers being Private Companies.

Bank Guarantees outstanding as on 31st March, 2013, amounted to Rs 17,37,74,365/- (p.y. Rs 19,06,75,639/-) and Letters of Credit outstanding as at 31st March 2013, amounted to Rs 9,69,49,897/- (p.y. Rs. 16,54,25,325/-) against which the company has kept the Margin Money in the form of Fixed Deposit worth Rs. 2,95,73,729/- (p.y. Rs. 3,88,79,437/-).

5. Commitments (to the extent not provided for)

Estimated amt. of contracts remaining to be executed on capital account : Nil (p.y. Nil) Other Commitments : Nil

6. Proposed Dividend :

Amount of Rs. 0.50 per Equity Share aggregating to Rs. 1,906,700 is being proposed as dividend on equity shares. There are no arrears of dividends.

7. Post Employment Benefits:

Provident Fund dues amounting to Rs. 8,00,846 (PY Rs. 8,43,479) paid during the year being defined contributions has been charged to the Statement of Profit and Loss.

The value of obligation towards entitlement of employees accumulating earned leave and eligibility of compensation or encashment of the same is determined on the basis of the expected amount required to be paid as a result of actual unused entitlement standing to the credit of the employees as at end of the year based on current salary standards measured by actuarial valuation using projected unit credit method as at the balance sheet date. Accordingly a sum of Rs. 9,71,463 (p.y. Rs. 9,58,653) has been determined as obligation as at the year end. The current year cost including actuarial gains / losses of Rs. 4,01,847/- (p.y Rs. 5,23,136/-) has been charged to the Statement of Profit and Loss Account and the benefit pay out of Rs. 3,89,037/- (p.y Rs. 5,64,705/-) has been deducted from the overall liability which is unfunded.

The Company has a defined benefit gratuity plan. As per the Payment of Gratuity Act, 1972, every employee who has completed five or more years of service is eligible for gratuity @ 15 days salary (last drawn) for every completed year of service with an overall ceiling of Rs. 10,00,000 (PY Rs. 10,00,000) at the time of separation from the Company or retirement whichever is earlier. The Company has taken a Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India ( a qualifying policy ) and makes annual contributions to the same to create a fund to meet this defined benefit gratuity obligation.

8. Segment Reporting

With respect to Accounting Standard-17, the Management of the Company is of the view that the products offered by the Company are in the nature of Transformers and its related products, having the same risks and returns, same type and class of customers and regulatory environment. Hence, the business of production and sale of transformers and its related products belong to one business segment only.

9. Disclosure as per Accounting Standard 19 on "Accounting for Leases"

The Company has obtained certain premises and equipment on lease / leave and license basis. All the agreements fall under operational leases as per the accounting and recognition policy of the Company.

10. Related Party Transactions

The Company has identified all the related parties having transactions during the year, as per details given below, in line with Accounting Standard-18. In respect of the outstanding balance receivable as on 31.3.2012 no provision for doubtful debts / advances is required to be made.

11. Impairment of Assets:

As a tool to measure to the value of fixed assets, the Company has considered the technical Valuation carried out by expert in the recent. In terms of the valuation report and further in absence of any indications, external or internal, as to any probable impairment of assets, no provision has been made for the same during the year under report. However, Valuation relating to Delhi Office and Furniture has not been obtained and hence it is not possible to determine the impairment, if any, on account of those assets.

12. The Company did not have any forward contracts outstanding as at the year and hence no need for recognizing any mark- to-market losses in term of ICAI announcement dtd. 29th March, 2008 on "Accounting for Derivatives"

13. The Company has acquired a new land for future expansion purposes in the preceding financial year. The company has incurred various expenditures in relation to the said land for the purpose of the development of the same. The development cost incurred in respect of the said land has been accounted under the head of Capital Work in Progress.

14. Directors'' remuneration is within the limits prescribed by Section II of Part II of Schedule XIII of the Companies Act, 1956. The amounts paid included the following :

The Managing Director is eligible for Gratuity as well as Leave Encashment and is covered there-under alongwith other employees of the Company. However, the above amounts do not include contribution to gratuity fund and provision for leave encashment as well as perquisite for free usage of car as separate figures are not available.

15. The Company owns a Windmill which produces power. The Units of Power generated from the Windmill are setoff against the monthly power bill of the Company. Consequently, the power cost of the Company for the year under report is net of the setoff of the power units generated from the Windmill

16. There are no amounts pending to be transferred to the Investors Education and Protection Fund as at the end of the year.

17. The figures in respect of previous year have been regrouped / recast wherever necessary to confirm to the current years'' classification.


Mar 31, 2012

1. General Information of the Company.

SHILCHAR TECHNOLOGIES LIMITED ("the Company"), incorporated in the year 1986 is a Vadodara, Gujarat, based ISO 9001:2008 profit making and dividend paying Public Limited Company engaged in the business of manufacturing of "Distribution & Power Transformers" as well "Electronics & Telecommunication Transformers."

The Company made its public issue in the year 1995 and is listed on Mumbai Stock Exchange and Vadodara Stock Exchange.

(a) The Company has a single class of equity shares which are having par value of Rs. 10 per equity share. All shares rank pari passu with reference to all rights relating thereto. Each Shareholder is eligible for one vote per share held. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportions to their shareholding.

Long Term Unsecured Loans represent balance out of the External Commercial Borrowings (ECB's) obtained by the Company from one of its Foreign Equity holders to the tune of US$ 350000 for the purpose of its erstwhile expansion project in terms of relevant rules of the Reserve Bank of India. Company had initially obtained deferment on repayment of the balance of the principal amount. However, Company has started repayment of the Loan as per installments agreed upon. The interest as well as exchange rate difference is being duly provided on the balance amounts.

Deferred Tax Assets on Account of Provision for Diminution in Value of Investments are not recognized since there is no reasonable certainty that Company will have future taxable capital gains income against which such deferred tax assets can be realized.

The Bank facilities of Working Capital being Cash Credit, Export Packing Credit and other Facilities obtained from Bank of Baroda are secured by Hypothecation of Stocks, Book Debts, Extension of charge on Current Assets for Letters of Credit, Hypothecation of Plant and Machinery (both present and future) and Equitable Mortgage of entire Factory Land and Building including Corporate Office of the Company. The Bank Facilities of Working Capital being Cash Credit Facilities, Working Capital Demand Loans and other facilities obtained from Standard Chartered Bank are secured by way of a pari passu charge on the above assets of the Company. The Bills discounting facilities obtained from Kotak Mahindra Bank and ICICI Bank are against LC's of customers duly confirmed by their respective bankers

Micro and Small Enterprises :

With reference to amounts shown as payable to Micro, Small and Medium Enterprises, the information has been compiled in respect of parties to the extent they could be identified as Micro, Small and Medium Enterprises on the basis of information collected and available with the Company and same has been relied upon by the auditors. The Company deals with various Micro Small and Medium Enterprises on mutually accepted terms and conditions. No interest is payable if the mutual terms are adhered to by the Company.

Accordingly, no interest has been paid during the year and further no provision for interest payable to such units is required or has been made under Micro, Small and Medium Enterprises Development Act, 2006. Hence, information as required under Schedule VI of the Companies Act, 1956 relating to delayed payments and interest on delayed payments to Micro, Medium and Small Enterprises has not been compiled and presented.

In case of Sundry Debtors outstanding for more than one year, certain sums are outstanding against deductions made on account of quality, late delivery etc. by the parties to whom supplies were made. However, the Management is pursuing the matters with the respective parties and is confident of recovering the amount and hence no provision has been made against the same. Similarly, in case of delayed delivery beyond the stipulated terms of supply order, expected deduction for later delivery based on contractual terms is not provided for since Management is confident of being able to pursue the matters and recovering the amounts, if deducted.

1. Sundry Creditors and Sundry Debtors are as per books and have not been corroborated by circulation / confirmation of balances / reconciliation of accounts. Confirmations of parties concerned, for the amount receivable / due to them as per accounts of the company, are under process of reconciliation and adjustments required, if any, will be made as and when the accounts are settled.

2. In the opinion of the Board, the Current Assets, Loans and Advances which are considered good are expected to realise at least the amount at which they are stated, if realized in the ordinary course of business. Further, in the opinion of the Board, provision of all known liabilities has been adequately made in the accounts and as per management experience and estimates no additional provision is required for guarantees and warranties, liquidated damages etc

3. Contingent Liabilities (to the extent not provided for)

Claims against the Company not acknowledged as debt:

Service Tax Credits Reversed under Protest-Rs. 654717/- (Decision Pending)

CST Demand on receipt of Appellate Order for 2006-07 - Rs. 310023 (Company is contemplating filing appeal before the Tribunal within 60 days)

VAT/CST Demand on Assessment for 2007-08 Rs. 2455370

Demand expected to be reduced to approx. Rs. 800000 on receipt of effect of appellate order for 2006-07. Company has also filed appeal before Jt. Commissioner of Sales Tax (Appeals) against the Assessment Order which is pending. Demand for 2008-09 by Excise Dept-Rs. 3,40,420/- (disallowance of credit availed). Company has won its appeal before the Asst. Commissioner of Central Excise. However, the Department has preferred further appeal Legal Case Filed against Company by its Creditors-Rs.1,64,340/-

Legal Case Filed by Company against Debtors with amount still outstanding in books-Rs. 78,780 Guarantees :

The Company has given Corporate Guarantees for Performance of Products to the tune of Rs.1,38,97,990/- (p.y. Rs.96,24,351/-) to EPC Customers being Private Companies.

Bank Guarantees outstanding as on 31st March, 2012, amounted to Rs 19,06,75,639/- (p.y. Rs 11,81,47,311/-) and Letters of Credit outstanding as at 31st March 2012, amounted to Rs 16,54,25,325/- (p.y. Rs. 13,14,79,845/-) against which the company has kept the Margin Money in the form of Fixed Deposit worth Rs. 3,88,79,437/- (p.y. Rs. 3,28,81,715/-).

4. Commitments (to the extent not provided for)

Estimated amt. of contracts remaining to be executed on capital account: Ni (p.y. Rs. 300 lacs)

Other Commitments : Nil

5. Proposed Dividend :

Amount of Rs. 0.50 per Equity Share aggregating to Rs. 1,906,700 is being proposed as dividend on equity shares.

There are no arrears of dividends.

6. Post Employment Benefits:

Provident Fund dues amounting to Rs. 8,43,479 (PY Rs. 8,85,579) paid during the year being defined contributions has been charged to the Statement of Profit and Loss.

The value of obligation towards entitlement of employees accumulating earned leave and eligibility of compensation or encashment of the same is determined on the basis of the expected amount required to be paid as a result of actual unused entitlement standing to the credit of the employees as at end of the year based on current salary standards measured by actuarial valuation using projected unit credit method as at the balance sheet date. Accordingly a sum of Rs. 9,58,653 (p.y. Rs. 10,00,222) has been determined as obligation as at the year end. The differential of Rs. 523,136 (p.y. 689,439) between the obligation as at the end of previous year, compensation paid during the year and the obligation as the year end has been charged to the Statement of Profit and Loss.

The Company has a defined benefit gratuity plan. As per the Payment of Gratuity Act, 1972, every employee who has completed five or more years of service is eligible for gratuity @ 15 days salary (last drawn) for every completed year of service with an overall ceiling of Rs. 10,00,000 (PY Rs. 3,50,000) at the time of separation from the Company or retirement whichever is earlier. The Company has taken a Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India ( a qualifying policy ) and makes annual contributions to the same to create a fund to meet this defined benefit gratuity obligation.

7. Segment Reporting

With respect to Accounting Standard-17, the Management of the Company is of the view that the products offered by the Company are in the nature of Transformers and its related products, having the same risks and returns, same type and class of customers and regulatory environment. Hence, the business of production and sale of transformers and its related products belong to one business segment only.

8. Impairment of Assets:

As a tool to measure to the value of fixed assets, the Company has considered the technical Valuation carried out by expert in the recent. In terms of the valuation report and further in absence of any indications, external or internal, as to any probable impairment of assets, no provision has been made for the same during the year under report. However, Valuation relating to Delhi Office and Furniture has not been obtained and hence it is not possible to determine the impairment, if any, on account of those assets.

9. The Company did not have any forward contracts outstanding as at the year and hence no need for recognizing any mark- to-market losses in term of ICAI announcement dtd. 29th March, 2008 on "Accounting for Derivatives"

10. The Company has acquired new land for future expansion purposes. Company has been making payments of the total determined consideration in installments since the previous financial year. The acquisition of land took a substantial period of time. Hence, after more than 6 months had elapsed from the payment of the first installment, the Company decided to capitalise the total borrowing costs related to the above land acquisition based on the installments paid right from the date of the first installment, in terms of the accounting practice followed by the Company in consonance with Accounting Standard- 16 Borrowing Costs,.

Accordingly, total Borrowing Costs of Rs. 49,65,436 have been worked out and capitalized during the year to the cost of acquisition of the said land. Since there are no separate borrowings for the said acquisition, the costs have been worked out by calculation proportionate interests from the total interest costs incurred by the company. Out of the total capitalized borrowing costs a sum of Rs. 5,15,342 is relating to the last quarter of the previous financial year when the first installment was paid and hence has been treated as prior period income.

The Managing Director is eligible for Gratuity as well as Leave Encashment and is covered there-under along with other employees of the Company. However, the above amounts do not include contribution to gratuity fund and provision for leave encashment as well as perquisite for free usage of car as separate figures are not available.

11. The Company owns a Windmill which produces power. The Units of Power generated from the Windmill are setoff against the monthly power bill of the Company. Consequently, the power cost of the Company for the year under report is net of the setoff of the power units generated from the Windmill

12. There are no amounts pending to be transferred to the Investors Education and Protection Fund as at the end of the year.

13. These financial statements have been prepared in the format prescribed by the Revised Schedule VI to the Companies Act, 1956. Previous periods figures have been recast / restated.


Mar 31, 2010

1. Foreign Currency Monetary Item Translation Difference :

In terms of Notification issued by the Ministry of Corporate Affairs on 31st March, 2009 and accepted by the Institute of Chartered Accountants of India, the Company had opted for accumulating the Exchange

2. During the year, the Company has sold its investments in shares of Intech Agenci|s Private Limited (the then Company under thsj same Management), The Company held 105000 eqi§ty shares of Rs. 10/- each costing a sum totaliof Rs. 10,50,000A. Provision for diminution in value his been made for this entire amount of Rs. 10,00,000/- in earlier years. During the year, these investments were disposed off for Rs. 55000/-. Company hasrayersed the provision for diminutionto that extent and adjusted the sale proceeds against the same

3. Long Term Investments held by the Company to thetune of sRss ©89985/r were diminished fully till the end of the previous financial year and have not been reflected in the Schedules to the Balance Sheet since their net carrying cost has been reduced to Nil

No new Provision has been made for diminution (not considered as temporary) in the value of Long Term Investments during the year.

4. No Borrowing Costs were eligible for capitalization during the year.

5. Sundry Debtors are as per books and have not been corroborated by circulation / confirmation of balances. As for Sundry Creditors, confirmation of parties concerned, for the amount due to them as per accounts of the company, are received for some of the parties and for others, adjustments if any, required will be made as and when the accounts are settled.

6. Other Current Liabilities include credits in the Bank Accounts of the Company not identifiable with a particular party. The same are adjusted against the relevant parties on receipt of information / confirmation of balances with the said parties.

7. With reference to amounts shown as payable to Micro, Small and Medium Enterprises, the information has been compiled in respect of parties to the extent they could be identified as Micro, Small and Medium Enterprises on the basis pffrtfo^ and same has been relied upon by the auditors. The Company deals with various Micro Small and Medium Enterprises on mutually accepted terms and conditions. No interest is payable if the mutual terms are adhered to by the Company.

Accordingly, no interest has been paid during the year and further no provision for interest payable to such units is required or has been made underMicro,. Small and Medium Enterprises Development Act, 2006. Hence, informatioias required under Schedule VI of the Companies Act, 1 956 relating to delayed payments and interest c|n delayed payments to Micro, Medium and Small Enterprises has not been compiled and presented,

8. The Company owns a Windmill which produces power. The Units of Power generated from the Windmill are setoff against the monthly power bill of the Company. Consequently, the power cost of the Company for the year under reports net of the setoff of the power units generated from the Windmill.

9. During the year, Company has sold a piece of Land for Rs. 44,00,000. However, In absence of detailed Fixed Assets Register f orjthe period pjior to the year 2000, the actual cost / revalued cost of this particular land as covered under the Gross Block of Land in the Fixed Assets Schedule could not be ascertained. The Company has worked out the actual acquisition and development cost of Rs. 611795 and treated the balance amount of Rs> 37,88,205lasProfit.on thesale.

10. In the opinion of the Board, the Current Assets, Loans and Advances which are considered good are expected to realise at least the amount at which they are stated, if realized in the ordinary course of business. Further, in the opinion of the Board, provision of all known liabilities has been adequately made in the accounts and as per management experience and estimates no provision is required for guarantees and warranties, liquidated damages etc.

11. Contingent Liabilities

Bank Guarantees outstanding as on 31st March, 2010, amounted to Rs 9,83,67,176/- (p.y. Rs 5,61,74,100/-) and Letters of Credit outstanding as at 31st March 2010, amounted to Rs 6,41,90,080/- (p.y. Rs. 2,97,80,822/-) against which the company has kept the Margin Money in the form of Fixed Deposit worth Rs. 1,99,27,057 (p.y. Rs. 1,03,42,206/-).

The Company has given Corporate Guarantees for Performance of Products to the tune of Rs.6,14,679/ - to EPC Customers being Private Companies.

12. Post Employment Benefits:

Provident Fund dues amounting to Rs. 859740 (PY Rs. 855417) paid during the year being defined contributions has been charged to the Profit and Loss Account.

Long Term Employee Benefits on account of compensated absences have been accounted for on actuarial basis using the Projected Unit Credit Method.

The Company has a defined benefit gratuity plan. Every employee who has completed five or more years of service is eligible for gratuity @ 15 days salary (last drawn) for every completed year of service with an overall ceiling of Rs. 350000. The Company has taken a Group Gratuity cum Life Insurance Policy from Life Insurance Corporation of India (a qualifying policy) and makes annual contributions to the same to create a fund to meet this defined benefit gratuity obligation.

13. Segment Reporting

With respect to Accounting Standard-17, The Management of the Company is of the view that the products offered by the Company are in the nature of Transformers and its related products, having the same risks and returns, same type and class of customers and regulatory environment. Hence, the business of production and sale of transformers and its related products belong to one business segment only.

14. Related Party Transactions

The Company has identified all the related parties having transactions during the year, as per details given below, in line with Accounting Standard-18. In respect of the outstanding balance receivable as on 31.3.2010 no provision for doubtful debts / advances is required to be made.

15. Deferred Taxes

In compliance with Accounting Standard - 22 on Taxes on Income issued by the Institute of Chartered Accountants of India, the Company has disclosed deferred tax liabilities and deferred tax assets as under for the year ended 31st March, 2010 after charging the net deferred tax liability for the year under report of Rs. 8,60,259 (p.y. Rs. 1,40,529) the profit and loss account.

16. Impairment of Assets:

As a tool to measure to the value of fixed assets, the Company has considered the technical Valuation carried out by expert in the immediate past. In terms of the valuation report and further in absence of any indications, external or internal, as to any probable impairment of assets, no provision has been made for the same during the year under report. However, Valuation relating to Delhi Office and Furniture has not been obtained and hence it is not possible to determine the impairment, if any, on account of those assets.

17. There are no amounts pending to be transferred to the Investors Education and Protection Fund as at the end of the year.

18. The figures in respect of previous year have been regrouped / recast wherever necessary to conform to the current years classifications

 
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