Mar 31, 2015
A) BASIS OF PREPARATION OF ACCOUNTS:
The financial statements have been prepared under the historical cost
convention in accordance with Generally Accepted Accounting Principles
and provisions of Companies Act, 2013 and comply with applicable
accounting standards referred to in Companies Act, 2013. The company
follows mercantile system of accounting and recognizes significant
items of Income & Expenditure on accrual basis.
b) FIXED ASSETS
Fixed Assets are stated at cost of acquisition less accumulated
depreciation. The cost of fixed assets includes freight, taxes, duties
and other incidental expenses related to acquisition and installation.
The amount includes borrowing cost capitalized as per Accounting
Standard-16 on borrowing cost, less CENVAT credit availed, VAT credit
to the extent available and subsidy received from government relating
to fixed assets.
During the year the company continued the development of built a new
furnace at Jhagadia. The initial production capacity of 540 MT per day
has been raised to 625 MT per day. The said furnace was again being put
through trial runs in this financial year. The cost of gas consumed Rs.
1,65,59,287/- during trial runs has also been added to the value of
Furnace Work in Progress. Commercial production has not been started
from this furnace till 31.03.2015. Company has capitalized all the
incidental cost of trial runs incurred till 31.03.2015.
The Company also under took the capacity enhancement of its 2nd furnace
at Jhagadia from 200 MT per day to 275 MT per day. The capital expenses
incurred on the same till 31.03.2015 have been classified as "Capital
Work In Progress".
c) DEPRECIATION OF FIXED ASSETS:
Depreciation for the year has been provided in accordance with rates
and manners specified in Part "C" of Schedule II of Companies Act, 2013
on Straight Line Method. Depreciation on addition/deduction during the
year has been provided on pro-rata basis from date of such
addition/deduction. The company has assessed the remaining useful life
of its fixed assets equivalent to the specified life in schedule II of
the Act starting from 2014-15. The depreciation has been charged
accordingly without giving retrospective effect.
Throughout the year 2014-15, the company did not put furnace no. 2 (200
MT per day capacity) at Jhagadia as it was under reconstruction for
capacity enhancement and hence depreciation on the same has not been
charged.
d) INVENTORY VALUATION
Raw Material, WIP and Finished Goods are valued at lower of cost and
net realizable value. Cost of raw material is computed on FIFO method
of valuation. Cost of Work In Progress and Finished Goods includes raw
material cost, estimated cost of conversion, including fuel cost,
production overheads and other cost incurred in bringing the inventory
to their present location and condition. The value of inventory of
finished goods does not include excise duty that may be applicable.
f) CASH & CASH EQUIVALENTS
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
g) CASH FLOW STATEMENT
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
Mar 31, 2014
A) BASIS OF PREPARATION OF ACCOUNTS:
The financial statements have been prepared under the historical cost
convention in accordance with Generally Accepted Accounting Principles
and provisions of Companies Act, 1956 and comply with applicable
accounting standards referred to in section 211 (3C) of Companies Act,
1956. The company follows mercantile system of accounting and
recognizes significant items of Income & Expenditure on accrual basis.
b) FIXED ASSETS
Fixed Assets are stated at cost of acquisition less accumulated
depreciation. The cost of fixed assets includes freight, taxes, duties
and other incidental expenses related to acquisition and installation.
The amount includes borrowing cost capitalized as per Accounting
Standard-16 on borrowing cost, less CENVAT credit availed, VAT credit
to the extent available and subsidy received from government relating
to fixed assets.
During the year the company has built a new furnace with the production
capacity of 540 MT per day. The said furnace was put through trial runs
in this financial year. Commercial production has not been started from
this furnace till 31.03.2014. Company has capitalized all the
incidental cost of trial runs incurred till 31.03.2014.
The Company is constructing the Two Additional Furnaces at Jhagadia
Unit. The capital expenses incurred on the same till 31.03.2014
amounting to Rs. 56,77,46,183/- have been classified as "Capital Work
In Progress". In the construction of these additional furnaces, the
Company has utilized the Furnace Refractories and Equipments of the old
furnaces at its Kheda unit amounting to Rs. 3,63,77,864/-.
c) DEPRECIATION OF FIXED ASSETS:
Depreciation for the year has been provided in accordance with rates
and manners specified in Schedule XIV of Companies Act, 1956 on
Straight Line Method. Depreciation on addition/deduction during the
year has been provided on pro-rata basis from date of such
addition/deduction. During the previous year, 2012- 13, the company had
under taken extensive refurbishment of the entire Plant & Machinery
which was lying unused for over 18 months. On account of the said
refurbishment, which continued till 30th June 2013, the Plant and
Machinery was not put to use other than for carrying out trial runs.
The commercial production was started only from 1st July, 2013. In the
view of above, the depreciation has been charged on pro-rata basis for
the partial period starting from 1st July, 2013.
The company also started the redesigning & rebuilding the Furnace no. 2
located at its Jhagadia Unit having production capacity of 200 MT per
day. The furnace remained closed and under development from October
2013 onwards. Hence the depreciation on the same has not been charged
from October 2013 onwards. As the redesigned and redeveloped furnace
would have higher production capacity with fully automated mechanism,
the company has capitalized the expenditure incurred on redesigning and
rebuilding. The furnace has not been put to use as on 31.03.2014 and
hence has been classified as Capital Work in Progress.
d) FURNACE RESTARTING EXPENDITURE
The company''s manufacturing operations were suspended in financial year
2011-12 requiring total overhaul, refurbishing and recommissioning of
plant & machinery. The expenditure incurred in preceding financial year
for such repairs, refurbishing and recommissioning the machinery, being
on capital field, were treated as Deferred Revenue Expenditure.
According to the Management of the Company, the estimated period of
benefit accrual from this expenditure shall be three to five years
commencing from 1st July 2013. In the view of the above, the company
had transferred the entire expenditure of refurbishment and related
income to Deferred Revenue Expenditure and shown in balance sheet
instead of charging the same to revenue. The same policy has been
adopted by the company for the period up to 30th June 2013 in the
financial year under audit. Company has started its commercial
production from 1st July, 2013.
e) INVENTORY VALUATION
Raw Material, WIP and Finished Goods are valued at lower of cost and
net realizable value. Cost of raw material is computed on FIFO method
of valuation. Cost of Work In Progress and Finished Goods includes raw
material cost, estimated cost of conversion, including fuel cost,
production overheads and other cost incurred in bringing the inventory
to their present location and condition. The value of inventory of
finished goods does not include excise duty that may be applicable.
f) CASH & CASH EQUIVALENTS
Cash comprises cash on hand and demand deposits with banks. Cash
equivalents are short-term balances (with an original maturity of three
months or less from the date of acquisition), highly liquid investments
that are readily convertible into known amounts of cash and which are
subject to insignificant risk of changes in value.
g) CASH FLOW STATEMENT
Cash flows are reported using the indirect method, whereby profit /
(loss) before extraordinary items and tax is adjusted for the effects
of transactions of non-cash nature and any deferrals or accruals of
past or future cash receipts or payments. The cash flows from
operating, investing and financing activities of the Company are
segregated based on the available information.
( c) Information regarding issue of Shares:
(1) The company has issued 86,65,511 no. of fresh Equity Shares to
Sicom Investments & Finance Limited on 1 st August, 2013 through an
Open Offer @ Rs. 11.54/Share. The said allotment is against the Loan Outstanding of Rs. 10,00,00,000/-.
(2) The company has not issues any shares without payment being not
received in cash.
(3) The company has not taken any buy back of shares.
*Increase in Security Premium Account is on account of issue of
86,65,511 equity shares at the premium of Rs. 1.54/- per share to
SICOM Investment & Finance Limited.
Mar 31, 2012
1. The financial statements have been prepared under Historical Cost
Convention in accordance with the generally accepted accounting
principles and the provisions of the Companies Act, 1956 as adopted
consistently by the Company. The same are prepared on a going concern
basis. The Company follows mercantile system of accounting and
recognizes significant items of income and expenditure on accrual
basis.
2. Depreciation on fixed assets is provided under the WDV method at
the rates and in the manner prescribed by Income tax Act, 1961.
3. Inventories are valued at cost price including expenses incurred in
putting the inventories in their present location and condition and Net
Realizable value whichever is lower and formula used is FIFO method.
4. The accounting standards as prescribed by The Companies Accounting
Standards Rules,2006 are applied wherever applicable in preparing and
presenting the financial statements.
5. Investments are stated at cost.
6. P F Superannuation Fund and other employees benefits scheme are not
yet applicable to the company.
7. Previous year figures have been regrouped and rearranged wherever
necessary.
8 Balance of Debtors, Creditors and depositors are subject to
confirmation and reconciliation.
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