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Notes to Accounts of Shree Ganesh Jewellery House (I) Ltd.

Mar 31, 2015

1. Background

Shree Ganesh Jewellery House (I) Limited ('the Company') formerly Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery, diamond and studded jewellery. The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited company with effect from 14th August, 2007. During the year 2009-10 the Company has made an Initial Public Offering (IPO) to issue 12,136,497 equity shares of face value of Rs. 10 each at Rs. 260 each (including a securities premium of Rs. 250 each) and got listed on National Stock Exchange and Bombay Stock Exchange. During the year 2012-13, the Company has further changed its name from Shree Ganesh Jewellery House Limited to Shree Ganesh Jewellery House (I) Limited with effect from 4th December, 2012.

2. Share Capital

a. Terms / rights attached to equity shares

The Company has only one class of Equity Shares having a par value of Rs. 10/- per Share. Each holder of equity shares is entitled to one vote per Share. The Company declares and pay dividends in Indian Rupees.

In the event of liquidation of the company, the holders of Equity Shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

3. "The Company through its wholly owned subsidiary Shree Ganesh Jewellery House FZE, in the month of August 2013 entered into an agreement for purchase of bullion from one of its supplier for 35 Tons quantity @USD 1420/oz based on orders in hand for bullion. However due to non-allowance and frequent changes in RBI policies for import of gold, the Company could not import bullion and the Company had to rescind the contract in the month of October 2013 @USD 1259/oz and accordingly the company had incurred a loss of USD 180,820,029/- i.e. approx Rs. 108,599.33 (Rs. 60.059/USD). To fund the losses the subsidiary entered into an arrangement with the supplier for supply of diamonds on 30% COD basis (30% equals the amount of loss) and balance on a credit period of approx 2 years.

Total losses suffered Rs. 108,599.33, of which the subsidiary of the Company had absorbed approx Rs. 49,522.85 (USD 82,456,536/-) to the extent of its net worth. The balance Rs. 59,076.47 is provisioned in the previous year as doubtful debt on account of receivables from its subsidiary because of non-ability to pay the amount by its subsidiary.

Investment value of Rs. 6157.63 appearing in the books of the Company is also provided for since the networth of the subsidiary has become negative due to loss incurred by them as explained above.

Rs. 253,234.93 shown as Long term non-current assets receivable from its subsidiary is because the same is sold by its subsidiary to the party with whom bullion transactions was booked and subsequently cancelled and arrangement for supply of bullion under 30% COD and balance on deferred payment basis i.e. on 2 years credit.

As explained above the company had incurred a total loss of Rs. 1,171.56 (PBT) in the previous year. Further since the subsidiary had sold goods of approx Rs. 2,532.35 on a credit of 2 years. The company underwent a liquidity crunch and was not able to pay towards liquidity dues. During the year 2013-14, the company had incurred total operating loss of Rs. 117,181.86 Lacs, negative cash from operations of Rs. 135,296.71 Lacs, failed to repay its long term borrowings of Rs. 3,000 Lacs and short terms borrowings of Rs. 281,291.72 Lacs, unable to pay its creditors of Rs. 60,213.45 Lacs. Accordingly the Company had filed a request with its bankers for composite Corporate Debts restructuring for debts taken by the Company.

Further during the previous financial year, one of our wholly owned subsidiary Shree Ganesh Jewellery House (Ghana) Ltd. purchased gold of approx 5.00 Kgs. However there was a theft and the Company has taken due steps to recover but has not recovered the same yet. Hence provision to that effect has been created.

4. CONTINGENT LIABILITIES

As at As at 31st March, 31st March 2015 2014 i. Corporate Guarantees given

- on behalf of subsidiaries 10,110.00 10,500.00

- on behalf of other group companies 39,108.50 33,660.00

ii. Claims against the Company in respect of Sales Tax matters not acknowledged as 4,807.31 4,724.13 debts

5. The company has not entered into forward contracts which are outstanding on balance sheet date in the current year and previous year.

6. Segment information in accordance with Accounting Standard 17 prescribed by Companies (Accounting Standard)

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customer's requirements and the company's manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information.

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/ specification specified by the customer there are no business segment to be reported under secondary segment information.

7. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006.

8. As per AS - 22 , issued by Company (Accounting Standards) Rules, 2006, on the basis of virtual certainty Deferred Tax Assets was recognised in the year 2013-2014. However as per recent assessment based on the outcome of Consortium Meeting held with all the consortium members regarding withdrawal of support from debt restructuring proposal of the Company, the carrying amount of the deferred tax asset is charged to Profit and Loss Account as it is no longer probable that sufficient taxable profit will be available to allow the benefit of deferred tax asset to be utilised in near future.

9. The company has taken an office and other premises on operating lease. Minimum lease payment charged during the year to the Profit and Loss Account aggregated to Rs. 65.76 (previous year Rs. 164.84).

10. During the year, the Company had written off MAT credit asset based on the assessment of current financial projections, it is probable that the Company may not be able to avail MAT benefit in the time span of next 10 years, as the projected profit taxable under normal income tax is lesser than the profit chargeable under MAT for next couple of years.

11. The Company had filed Flash Report under Corporate Debt Restructuring (CDR) mechanism for restructuring of its debt. However, in Consortium meeting of all the Banks held on 22nd January, 2015, the banks had decided to withdraw their support for restructuring the credit facilities offered to the Company .

The Company had again requested vide mail dated 4th Feb, 2015, all the lenders for reconsideration of the restructuring proposal so that the operations of the Company remain unaffected and a proper repayment schedule with mutual consent may be finalised. However the matter has been requested for reconsideration to the consortium Banks. Further, the Company filed a writ petition before the Honb'le High Court at Calcutta on 11th March, 2015 challenging inter alia the actions of the CDR Empowered Group and State Bank of India and the Honb'le High Court passed an interim order inter alia directing continuation of the "Holding on Operation" by the Company.

12. Fixed deposit amounting to Rs. 3031.08 (previous year Rs. 2287.58) pledged as security with Axis Bank against cash credit sanctioned was adjusted with the cash credit balance in the Company's books on maturity of the Fixed Deposit. However, as per cash credit account statement furnished by the bank the Fixed Deposit figure was not adjusted with the cash credit account balance. Thus, cash credit balance as per bank confirmation showed excess by Rs. 3031.08 (previous year Rs. 2287.58). Further, as per confirmation received from the bank the matured amount was not adjusted in the cash credit account but was transferred to a separate account of the bank. The bank is yet to provide explanations for such transfers made There is primafacie no impact on the profit/loss for the current quarter.

13. Cash credit balance of Dhanalaxmi Bank was shown less as per Company's books by Rs. 91.59. Cash credit balance as per Company's books was Rs. 1827.27 (previous year Rs. 1485.55) and balance as per bank confirmation was Rs. 1918.87 (previous year Rs. 1577.15). The Company had contested the excess amount claimed by the Bank in the High Court of Kolkata and had received a stay order on the excess claim made by the bank. However, as per order passed by the court on 10th March, 2014, pendency of the writ petition shall not preclude the respondents (bank) to proceed strictly in accordance with the Master Circular of Reserve Bank of India on Wilful Defaulters. As per order dated 8th September, 2014 of Hon'ble High Court, Kolkata, this writ petition succeeds. However, the amount remains unresolved till date.

14. The Company has been incurring cash losses in the current and previous financial year. Its current liabilities is exceeded the current assets and having negative cash flows. The Management is in the process of restructuring and is confident that these measures are expected to result in sustainable cash flows and accordingly the Company has continued to prepare its accounts on going concern basis.

15. The previous year's figures have been regrouped or reclassified wherever necessary to confirm with the current year's presentation.


Mar 31, 2014

The Company has made an Initial Public Offer (IPO) to issue 12,136,497 Equity Shares of RS. 10 each at RS. 260 each (includes securities premium of Rs. 250 each) in the year 2009-2010. In the year 2010-2011, the Company has issued and allotted Equity Shares. Out of the fund raised from IPO amounting to RS. 31,554.89, apart from meeting the IPO expenses of RS. 2,332.34, the Company has utilised the proceeds of the issue amounting to RS. 29,222.55 (P.Y RS. 29,222.55) for sefflng up and expansion of manufacturing units, sefflng up of retail outlets, meeting working capital requirements and for general corporate purposes upto the year ended 31st March 2013.

Further, the Company in the current year has allotted 7,080,000 (Previous Year 4,144,000) Equity Shares of Rs. 10 each which includes Security Premium of RS. 140 each for 5,800,000 equity shares issued to Promoters and Promoters Group (Previous Year Rs. 140 each for Shares to Promoters and Promoters Group) and Rs. 115 each for 1,280,000 Equity Shares issued to Non- Promoters through Preferential allotment.

Terms / rights attached to equity shares

The Company has only one class of Equity Shares having a par value of Rs 10/- per Share. Each holder of equity shares is entitled to one vote per Share. The Company declares and pay 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.

In the event of liquidation of the company, the holders of Equity Shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

b. 73.46% (Previous Year 72.54%) of Equity Shares of the Company are held by the promoter group of the Company.

1. Background

Shree Ganesh Jewellery House (I) Limited (''the Company'') formerly Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery, diamond and studded jewellery. The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited company with effect from 14th August 2007. During the year 2009-2010 the Company has made an Initial Public Offering (IPO) to issue 12,136,497 equity shares of face value Rs. 10 each at Rs. 260 each (including a securities premium of Rs. 250 each) and got listed on National Stock Exchange and Bombay Stock Exchange. During the year Company have further changed its name from Shree Ganesh Jewellery House Limited to Shree Ganesh Jewellery House (I) Limited with effect from 4th December, 2012.

2. The Company through its wholly owned subsidiary Shree Ganesh Jewellery House FZE, in the month of August 2013 entered into an agreement for purchase of bullion from one of its supplier for 35 Tons quantity @USD 1,420/oz based on orders in hand for bullion. However due to and due non-allowance and frequent changes in RBI policies for import of gold, the Company could not import bullion and the Company had to rescind the contract in the month of October 2013 @USD 1259/ oz and accordingly the company had incurred a loss of USD 180,820,029/- i.e. approx INR 108,599.33 (INR 60.059/USD). To fund the losses the subsidiary entered into an arrangement with the supplier for supply of diamonds on 30% COD basis(30% equals the amount of loss) and balance on a credit period of approx 2 years.

Total losses suffered INR 108,599.33, of which the subsidiary of the Company had absorbed approx INR 49,522.85 (USD 82,456,536/-) to the extent of its net worth. The balance INR 59,076.47 is provisioned as doubtful debt on account of receivables from its subsidiary because of non-ability to pay the amount by its subsidiary .

Investment value of INR 6,157.63 appearing in the books of the Company is also provided for since the networth of the subsidiary has become negative due to loss incurred by them as explained above.

INR 253,234.93 shown as Long term non-current assets receivable from its subsidiary is because the same is sold by its subsidiary to the party with whom bullion transactions was booked and subsequently cancelled and arrangement for supply of bullion under 30% COD and balance on deferred payment basis i.e. on 2 years credit.

As explained above the company had incurred a total loss of INR 117,156/- (PBT) in the current year. Further since the subsidiary had sold goods of Approx INR 253,235/- on a credit of 2 years. The company underwent a liquidity crunch and was not able to pay towards liquidity dues. During the year 2013-14, the company had incurred total operating loss of INR 117,181.86 Lacs ,negative cash from operations of INR 135,296.71 Lacs, failed to repay its long term borrowings of INR 3,000 Lacs and short terms borrowings of INR 281,291.72 Lacs, unable to pay its creditors of INR 60,213.45 Lacs. Accordingly the Company had filed a request with its bankers for composite Corporate Debts restructuring for debts taken by the Company.

In the current Financial year, one of our wholly owned subsidiary Shree Ganesh Jewellery House (Ghana) Ltd. purchased gold of approx 5.00 Kgs. However there was a theft, the Company has taken due steps to recover but has not recovered the same yet. Hence provision to that effect has been created.

3. Contingent Liabilities

i. Corporate Guarantees given

- on behalf of subsidiaries 10,500.00 10,500.00

- on behalf of other group companies 33,660.00 34,160.00

ii. Bills Discounted - 1,49,646.17

iii. Claims against the Company in respect of Sales Tax matters not 4,724.13 2,645.30 acknowledged as debts

4. Segment information in accordance with Accounting Standard 17 prescribed by Companies (Accounting Standard) Rules, 2006.

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customer''s requirements and the company''s manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information.

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/ specification specified by the customer there are no business segment to be reported under secondary segment information.

Segment information has been prepared in conformity with the accounting policies adopted for preparation and presentation of the financial statements of the Company.

5. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006

6. The company has taken an office and other premises on operating lease. Minimum lease payment charged during the year to the Profit and Loss account aggregated to Rs. 164.84 (previous year Rs. 231.67)

7. The previous year''s figures have been regrouped or reclassified wherever necessary to conform with the current year''s presentation.


Mar 31, 2013

1. BACKGROUND

Shree Ganesh Jewellery House (I) Limited (''the Company'') formerly known as Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery, diamond and studded jewellery. The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited company with effect from 14th August 2007. Duringthe year 2009-2010 the Company has made an Initial Public Offering (IPO) to issue 12,136,497 equity shares of face value Rs. 10 each at Rs. 260 each (including a securities premium of Rs. 250 each) and got listed on National Stock Exchange and Bombay Stock Exchange. Duringthe year Company have further changed its name from Shree Ganesh Jewellery House Limited to Shree Ganesh Jewellery House (I) Limited with effect from 4th December, 2012

2. CONTINGENT LIABILITIES [Rs in Lakhs]

Year ended Year ended 31st March 2013 31st March 2012

Corporate Guarantees given

- on behalf of subsidiaries 10,500.00 8,600.00

- on behalf of other group companies 34,160.00 35,288.00

ii. Bills Discounted 149,646.17 115,450.17

iii. Claims against the Company in respect of Sales Tax matters not acknowledged as debts 2,645.30 318.51

3. SEGMENT INFORMATION IN ACCORDANCE WITH ACCOUNTING STANDARD 17 PRESCRIBED BY COMPANIES (ACCOUNTING STANDARD) RULES, 2006.

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customer''s requirements and the company''s manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/specification specified by the customer there are no business segments to be reported under secondary segment information

4 Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006

5 The company has taken an office and other premises on operating lease. Minimum lease payment charged during the year to the Profit and Loss Account aggregated to Rs. 231.67 (previous yearRs. 182.92)

6 The previous year''s figures have been regrouped or reclassified wherever necessary to conform with the current year''s presentation


Mar 31, 2012

Note 1 BACKGROUND

Shree Ganesh Jewellery House Limited ('the Company') formerly Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery, diamond and studded jewellery. The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited company with effect from 14 August 2007. During the year 2009-2010 the Company has made an Initial Public Offering (IPO) to issue 12,136,497 equity shares of face value Rs 10 each at Rs260 each (including a securities premium of Rs 250 each) and got listed on National Stock Exchange and Bombay Stock Exchange.

a. Terms / rights attached to equity shares

The Company has only one class of Equity Shares having a par value of Rs 10/- per Share. Each holder of equity shares is entitled to one vote per Share. The Company declares and pay 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.

During the year ended 31st March 2012, The Board has recommended a Final Dividend of Rs 6 (60% of the paid up equity share capital of the Company) per equity share of face value Rs 10 each.

In the event of liquidation of the company, the holders of Equity Shares will be entitled to receive remaining assets of the Company. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

b. 70.66% of equity shares of the Company are held by the promoter group of the Company.

SEGMENT INFORMATION IN ACCORDANCE WITH ACCOUNTING STANDARD 17 PRESCRIBED BY COMPANIES (ACCOUNTING STANDARD) RULES, 2006.

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customer's requirements and the company's manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information.

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/ specification specified by the customer there are no business segment to be reported under secondary segment information.

As per records of the Company, including its register of shareholders / members and other declarations received from shareholders regarding beneficial interest, the above shareholding represents both legal and beneficial ownership of shares

* Debentures are due for repayment at the end of 3rd, 4th and 5th year in the ratio of 30:35:35 from the date of allotment, viz, 20/12/2010 and 03/11/2010, Rs 5,000 each. These are Secured by first charge on the Fixed Assets of the Company to the extent of 1.25 times of the value of non convertible debentures. ** Secured by hypothecation of the vehicles purchased from the proceeds of the loan.

* Secured by way of first charge on current assets of the Company, both present and future, excluding assets having specific charge of respective financing banks, and second charge on fixed assets, both current and future. Irrevocable and uncondiotional personal guarantee of the Promotor Directors.

** Secured by way of lien on fixed deposits.

*** First charge on export bills discounted under confirmed orders & bills purchased under confirmed orders by banks. Also secured by way of margin money and first charge on the current assets of the Company, both present and future, and second charge on fixed assets of the Company, both present and future. Irrevocable and uncondiotional personal guarantee of the Promotor Directors.

****Secured by way of margin money and first charge on current assets of the Company, both present and future, excluding assets having specific charge of respective financing banks, and second charge on fixed assets of the Company, both present and future. Irrevocable and uncondiotional personal guarantee of the Promotor Director.

(a) Includes gross block Rs 201.92 (Previous Year Rs 201.92), accumulated depreciation Rs 53.51 (Previous Year Rs 45.68) and written down value Rs 148.41 (Previous Year Rs 156.24), jointly held with others.

(b) Includes gross block Rs 102.93 (Previous Year Rs 162.84) and accumulated depreciation Rs 25.28 (Previous Year Rs 31.20), that are yet to be registered in the name of the Company.

* Comprises of Intercorporate deposit given to Alex Mercury Power Private Limited repayable after 7 years from the date of payment

* Include stock lying with third parties Rs 10,348.26 (Previous year Rs 9,254.92). Closing stock excludes stock provided by third parties amounting to Rs 214.62 (Previous Year Rs 241.84) as at the year end.

Note 2 CONTINGENT LIABILITIES

i. Corporate Guarantees given – on behalf of subsidiaries 8,600.00 7,100.00

– on behalf of other group companies 35,288.00 2,228.50

ii. Bills Discounted 115,450.17 93,912.85

iii. Claims against the Company in respect of Sales Tax matters not 318.51 383.25 acknowledged as debts

60,682,485 (Previous Year 48,545,988) equity shares outstanding for 365 days including:

–12,136,497 Equity Shares issued during the year 2010-11 through Initial Public offering outstanding for 362 days in Previous years

The Gratuity expenses have been recognised as 'Employee benefit expense' under Note 26.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority,

promotion and other relevant factors such as supply and demand factors in the employment market.

The purpose of entering into forward exchange Contract is to hedge foreign currency exposure on payment of creditors/ borrowings and receipts from debtors to hedge price fluctuation risk. During the current year the company has not entered into any derivative instruments for speculation purpose.

Segment information has been prepared in conformity with the accounting policies adopted for preparation and presentation of the financial statements of the Company.

The previous year's figures have been regrouped or reclassified wherever necessary to conform with the current year's presentation.


Mar 31, 2011

Background

Shree Ganesh Jewellery House Limited ('the Company') formerly Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery,diamond and studded jewellery.

The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited company with effect from 14 August 2007. During the year 2009-2010 the Company has made an Initial Public Offering (IPO) to issue 12,136,497 equity shares of face value Rs. 10 each at Rs. 260 each (including a securities premium of Rs. 250 each) and got listed on National Stock Exchange and Bombay Stock Exchange.

a) Includes gross block Rs. 201.92 (Previous Year Rs. 201.92), accumulated depreciation Rs. 45.68 (Previous Year

Rs. 37.46) and written down value Rs.156.24 (Previous Year Rs.164.46), jointly held with others.

b) Includes gross block Rs.162.84 (Previous Year 162.84) and accumulated depreciation Rs. 31.20 (Previous Year Rs. 24.27), that are yet to be registered in the name of the Company.

* 60,582,733 (Previous Year 46,248,272) equity shares outstanding for 365 days including:

- 12,136,497 Equity Shares issued during the year through Initial Public offering outstanding for 362 days (Previous Year Nil).

- 2,666,666 Preference shares converted into equity share on 28 August 2009 outstanding for 216 days in previous year;

- 166,667 Debenture converted into equity share on 11 August 2009 outstanding for 233 days in previous year; ' and

- 24,272,994 bonus shares allotted on 23 September 2009.

Note :

There is no licensed capacity. Plant and machinery installed can manufacture a wide variety of gold jewellery of different specification and design and hence it is not considered practical to state quantitative details of installed capacity. Precious and semi precious stones are embedded in Gold jewellery and articles.

Figures in Bracket represent previous year's figure.

* Quantities of production, turnover, finished goods, raw material consumed and traded goods purchased,include gold of different fineness. For reporting purposes, all quantities have been converted to 0.995 fineness of gold.

** Closing stock excludes stock provided by third parties amounting to Rs. 241.84 (Previous Year Rs. 28.35) as at the year end.

The Gratuity expenses have been recognised as ‘Employee Benefit' under Schedule 18 to the Profit and Loss Account.

The estimates of future salary increases, considered in actuarial valuations take account of inflation, seniority,promotion and other relevant factors such as supply and demand factors in the employment market.

The purpose of entering into forward exchange Contract is to hedge foreign currency exposure on payment of creditors/borrowings and receipts from debtors to hedge price fluctuation risk. During the current year the company has not entered into any derivative instruments for speculation purpose.

2. Segment information in accordance with Accounting Standard 17 prescribed by Companies (Accounting Standard) Rules, 2006.

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customer's requirements and the company's manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information.

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/ specification specified by the customer there are no business segment to be reported under secondary segment information.

Segment information has been prepared in conformity with the accounting policies adopted for preparation and presentation of the financial statements of the Company.

3. a) Pursuant to the approval of the shareholders as on 7 March 2008 and a Shareholders Agreement.

(‘Agreement') dated 12 March 2008, the Company had issued 2,666,666, 0.0001% Cumulative Convertible Preference shares having a value of Rs. 300/- each to an investor in accordance with the terms set out in the Agreement. As per the terms, the Company has converted the Preference Share into Equity Shares on 28 August 2009, in accordance with the procedure stated in the agreement. 2,666,666 nos of Preference . Shares have been converted to Equity Shares at a premium of Rs. 290 per share.

b) Pursuant to the approval of the Board of Directors as on 7 June 2007 and a Convertible Debenture Subscription Agreement dated 13 June 2007 the Company has issued 5,000,000 0% Fully Convertible Debentures of Rs.100 each at par. As per the terms of the Agreement, each debenture allotted to the debenture holder would be compulsorily converted to equity shares in case the Company comes out with initial public offer. In the event ,the debentures do not get converted into equity shares by 31 March 2008, the debentures would be mandatorily converted into equity shares at a conversion price laid down in the Agreement based on the audited financial statement for the year 2007-2008. The Company has converted these debentures into 166,667 equity shares on 11 August 2009 at a premium of Rs. 290 per share.

4. "The Company has made an initial public offer (IPO) to issue12,136,497 equity shares of Rs. 10 each at Rs. 260 each (includes securities premium of Rs. 250 each) in the year 2009-2010. In the year 2010-2011, the Company has issued and allotted equity shares . Out of the fund raised from IPO amounting to Rs. 315.54 crores, apart from meeting the IPO expenses of Rs. 2,332.34 Lakhs, the Company has utilised the proceeds of the issue amounting to Rs. 16,606.79 Lakhs for setting up and expansion of manufacturing units, setting up of retail outlets, meeting working capital requirements and for general corporate purposes upto the year ended 31 March 2011. The unutilised fund of the issue amounting to Rs. 12,615.76 Lakhs has been temporarily invested in interest bearing liquid instruments including deposit with banks and investment in mutual funds.

During the year the Company has paid an Interim Dividend of Rs. 3 (30% of the paid up equity share capital of the Company) per equity share of face value Rs. 10 each for the year 2010-2011. The Board has recommended a - Final Dividend of Rs. 3 (30% of the paid up equity share capital of the Company) per equity share of face value Rs. 10 each. The total dividend (including interim dividend) for the financial year 2010-2011 is Rs. 6 (60% of the paid up equity share capital of the company) per equity share of face value Rs. 10 each.

The proposed dividend for the year ended 31 March 2010 has been considered in the accounts after considering the aforesaid allotment as these shares rank pari passu with the shares outstanding as on 31 March 2010 as regards right to dividend for that year."

5. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006

6. The company has taken an office and other premises on operating lease. Minimum lease payment charged during the year to the Profit and Loss account aggregated to Rs. 129.51 (previous year Rs. 99.82)

7. The previous year's figures have been regrouped or reclassified wherever necessary to conform with the current year's presentation.


Mar 31, 2010

Background

Shree Ganesh Jewellery House Limited (the Company) formerly Shree Ganesh Jewellery House Private Limited, was incorporated in 2002. The Company is engaged in the business of manufacture and sale of handcrafted gold jewellery, diamond and studded jewellery. The name of the Company changed to Shree Ganesh Jewellery House Limited on conversion to public limited Company with effect from 14 August 2007.

(Rs. in Lacs)

As at As at

31.03.2010 31.03.2009

1. Estimated Capital Commitments (Net of Advance) not provided for 107.77 432.10

2. a). Contingent Liabilities

i. Corporate Guarantees given on behalf of subsidiaries 6,500.00 6,000.00

ii. Bills Discounted 85,261.27 54,146.31

iii. Claims against the Company in respect of Income Tax / Sales Tax matters not acknowledged as debts 405.82 169.26

3. b). During the previous year the Income Tax Department had undertaken a search, under Section 132 of the Income Tax Act, 1961, at various premises of the Company and the residential premises of the Directors on 26 March 2009. The books of accounts and certain documents of the Company were seized by the Income Tax authorities and were subsequently returned. Further, Bank balances aggregating Rs. 20.12 remained prohibited from operations by such authorities as on 31 March 2009. Such prohibitory order has since been revoked. Mr. Nilesh Parekh was summoned by the Assistant Director of Income Tax in this regard. There has been no further action initiated by the Income Tax Authorities.

4. Related parties disclosure in accordance with AS - 18 prescribed by Companies (Accounting Standard) Rules, 2006

2009-10 2008-09 i) Enterprises directly / a) Gokul Jewellery House a) Gokul Jewellery House indirectly are under Private Limited Private Limited common control with b) JT Metals & Minerals b) JT Metals & Minerals the Company Exports Private Limited* Exports Private Limited* c) Bajoria Apartments c) Bajoria Apartments Private Limited* Private Limited* d) Chaturbhuj Jewellery d) Chaturbhuj Jewellery House Private Limited* House Private Limited* e) Gold Art Jewellers Private Limited* e) Gold Art Jewellers Private Limited* f) Safal Jewellers Private Limited* f) Safal Jewellers Private Limited* g) Shrishti Jewel Art Private Limited* g) Shrishti Jewel Art Private Limited*

h) Smart Gold Jewel House h) Smart Gold Jewel House Private Limited* Private Limited* i) Samukh Exim Private Limited* i) Samukh Exim Private Limited* j) Galaxy Jewel Private Limited* j) Galaxy Jewel Private Limited* k) Mudrika Jewels Private Limited* k) Mudrika Jewels Private Limited* l) Subarna Jewels Private Limited* l) Subarna Jewels Private Limited* m) Shree Ganesh Jewellery House m) Shree Ganesh Jewellery House (Singapore) Pte. Ltd. (Singapore) Pte. Ltd. n) Easy fit Jewellery Private Limited* n) Easy fit Jewellery Private Limited* ii) Associate of the a) Damgan Retail Jewellery a) Damgan Retail Jewellery Company Private Limited Private Limited

iii) Individuals owning a) Mr. Umesh Parekh - a) Mr. Umesh Parekh - (directly/ indirectly) Managing Director Managing Director an interest in the b) Mr. Nilesh Parekh - Chairman b) Mr. Nilesh Parekh - Chairman voting power of the c) Mr. Kamlesh Parekh c) Mr. Kamlesh Parekh Company that gives d) Mrs. Kumud Parekh d) Mrs. Kumud Parekh them control or e) Mrs Sumona Parekh e) Mrs Sumona Parekh significant influence f) Mrs. Rani Parekh f) Mrs. Rani Parekh (also the key g) Mrs. Priti Parekh g) Mrs. Priti Parekh management h) Mr. Karan Parekh h) Mr. Karan Parekh personnel) i) Mr. Nischay Parekh i) Mr. Nischay Parekh j) Ms. Vansika Parekh j) Ms. Vansika Parekh k) Ms. Aastha Parekh k) Ms. Aastha Parekh

iv) Enterprise over which a) Umesh Parekh (HUF) a) Umesh Parekh (HUF) persons mention b) Nilesh Parekh (HUF) b) Nilesh Parekh (HUF) in (iii) are able to c) Swastik Wheat Product c) Swastik Wheat Product exercise significant Agencies Private Limited Agencies Private Limited influence d) Liberson Dealcomm Private Limited d) Liberson Dealcomm Private Limited

e) Aastha Complex Private Limited e) Aastha Complex Private Limited f) Kalindi Enclave PvtLtd f) Kalindi Enclave Pvt Ltd g) Vanshika Jewels Private Limited (ceased to be a Group company w.e.f. 1 April 2009) h) Shree Vinayak Jewellers (Partnership), Mumbai (ceased to be a Group company w.e.f. 14 April 2009) i) Safal Properties pvt Ltd (ceased to be a Group company w.e.f. 1 April 2009)

5. Segment information in accordance with Accounting Standard 17 prescribed by Companies (Accounting Standard) Rules, 2006.

The Company is engaged in the business of manufacture and sale of gold jewellery and other articles of various designs/ specification based on customers requirements and the Companys manufacturing facilities are located in India. The risk and returns of the Company are affected predominantly by the fact that it operates in different geographical areas i.e. domestic sales and export sales and accordingly geographical segment have been considered as the primary segment information.

In view of the fact that gold jewellery and other articles are manufactured and sold based on design/ specification specified by the customer there are no business segment to be reported under secondary segment information.

6. a) Pursuant to the approval of the shareholders as on 7 March 2008 and a Shareholders Agreement (‘Agreement’) dated 12 March 2008, the Company had issued 2,666,666,0.0001% Cumulative Convertible Preference shares having a value of Rs. 300/- each to an investor in accordance with the terms set out in the Agreement. As per the terms, the Company has converted the Preference Share into Equity Shares on 28 August 2009, in accordance with the procedure stated in the agreement. 2,666,666 no.s of Preference Shares have been converted to Equity Shares at a premium of Rs. 290 per share.

b) Pursuant to the approval of the Board of Directors as on 7 June 2007 and a Convertible Debenture Subscription Agreement dated 13 June 2007 the Company has issued 5,000,000 0% Fully Convertible Debentures of Rs. 100 each at par. As per the terms of the Agreement, each debenture allotted to the debenture holder would be compulsorily converted to equity shares in case the Company comes out with initial public offer. In the event ,the debentures do not get converted into equity shares by 31 March 2008, the debentures would be mandatorily converted into equity shares at a conversion price laid down in the Agreement based on the audited financial statement for the year 2007-2008. The Company has converted these debentures into 166,667 equity shares on 11 August 2009 at a premium of Rs. 290 per share.

7. The Company has made an initial public offer (IPO) to issue equity shares from 19 March 2010 to 23 March 2010. Monies received till 31 March 2010 were held in trust by the merchant banker with the Escrow Collection Bank on behalf of the bidders till the year end. Subsequent to the year end, the Company has issued and allotted equity shares. Post receipt of the monies the Company plans to the utilise the proceeds of the issue for setting up and expansion of manufacturing units, setting up of retail outlets, meeting working capital requirements and for general corporate purposes. The proposed dividend for the year ended 31 March 2010 has been considered in the accounts after considering the aforesaid allotment as these shares rank pari passu with the shares outstanding as on 31 March 2010 as regards right to dividend for the year.

8. Based on the information available with the Company, there are no dues to micro and small enterprises under the Micro, Small and Medium Enterprises Development Act, 2006.

9. The Company has taken an office and other premises on operating lease. Minimum lease payment charged during the year to the Profit and Loss account aggregated to Rs. 99.82 (previous year Rs. 85.21).

10. The previous years figures have been regrouped or reclassified wherever necessary to conform with the current years presentation.

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