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Notes to Accounts of Sonal Adhesives Ltd.

Mar 31, 2015

1. Rights, preferences and restrictions attached to shares:

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 & pays dividends in Indian rupees. The dividend, if 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, the Equity Shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.

2. During the period of five years immediately preceding the reporting date:

(i) The Company has not issued any shares pursuant to contract(s) without payment being received in cash. (ii) The Company has not allotted any shares as fully paid up by way of bonus shares. (iii) The Company has not bought back any shares.

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

3. Term Loan from Bank comprising Rs 2,68,67,145 [Previous Year: Rs 3,59,53,310], including Current Maturities of Long Term Debt Rs 1,20,00,000 [Previous Year: 84,00,000] are secured by:

(a) Equitable mortgage of land & building situated thereon at Gat No 232/2, Survey No 28, admeasuring 3860 sq mtrs, Hissa 1A, Village Dheku, Taluka Khalapur, District Raigad, Maharashtra

(b) Equitable mortgage of land & building situated thereon at Gat No 232/1, Survey No 28, admeasuring 2160 sq mtrs, Hissa 1A, Village Dheku, Taluka Khalapur, District Raigad, Maharashtra, owned by Sonal Ropes Limited

(c) Equitable mortgage of property at Ground Floor, "C" Wing, Bhagwati Building, FP Nos 18 - 19 / 34 A, B, C and 35 A, B, C TPS VI and CTS No 1610 / 27 & 1610 / 28 of Santacruz West, Linking Road, Extension Road, Mumbai 400054, owned by Sandeep Arora and Mridu Arora.

(d) Equitable mortgage of residential fat at 11th Floor, Morya Heights, Plot No 15, 16 and 17, Near Sanjeevani International School, Sector - 18, Kharghar, Navi Mumbai , District Raigad, owned by Sonal Impex Limited.

(e) Equitable mortgage of industrial property situation at Gut No 236 (1), House No 142, Village Dheku, off Takai - Adoshi Road, District Raigad, owned by Sonal Impex Limited

(f) Mortgage of immovable property situated at Abhishek Bungalow No 4, Four Bungalows, Andheri West, Mumbai 400 053, owned by director, towards enhanced mortgage debt.

(g) Hypothecation of existing fixed assets of the Company.

(h) Hypothecation of plant and machinery of Sonal Ropes Limited at written down values. (i) Cash collateral or immovable property valuing at Rs 0.50 crores. (j) Third party guarantee of:

- Sandeep Mohanlal Arora, Kamal Arora and Mridu Arora

- Corporate Guarantee of Sonal Impex Limited and Sonal Ropes Limited

(k) Hypothecation of current assets, including stocks, receivables, consumables, stores and spares and movable plant and machinery.

(l) Hypothecation of machines purchased out of bank fnance

4. Vehicle loan of Rs. 14,34,084 (Previous Year: Rs 9,88,922) comprising Rs. 5,60,977 (Previous Year Rs. Rs 3,63,940) classified as current maturities of long term borrowings included under other current liabilities is secured by way of hypothecation of vehicle financed.

5. Sales Tax Deferral Loans from the Government of Maharashtra are repayable as per the schedule provided by the Government of Maharashtra.

6. Working capital loans from bank comprise Cash Credit, and EPC, which are secured by:

(a) Hypothecation of Company's stocks of raw materials, fished goods, SIP of finished goods of proposed manufacturing activity in factory, go down, in transit or lying elsewhere.

(b) Charge on Company's receivables, book debts and other actionable claims.

(c) Rate of interest - Base rate 7% on daily products with monthly rests

7. The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at the year end together with the interest paid / payable, if any, as required under the said Act have not been given.

8. Trade Payables Due to related parties - -

9. Includes advance from related party Rs 14,37,722 [Previous Year: Rs 98,17,820]

10. The Company has been informed by its Bankers that an amount of Rs 35595 is lying to the credit of the account of the Company. This amount pertains to the year 1999. The Company has instructed the Bankers to deposit the amount into the Investor Education and Protection Fund. The Bankers are yet to do the needful in the matter.


Mar 31, 2014

1 a. The company has only one class of equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitiled to one vote per share. In the event of liquidation of the company, the holder of equity shares will be entitled to receive remaining assets of the company.

2. Points:

1 Car Loan:

a There are 2 term loans. One term loan from Axis Bank is secured against car.

The amount payable within one year is Rs 3.63 lakhs

2 Working Capital Facilities and Other Term Loans:

The working capital facilities and the term loans are secured against the following: a Equitable mortgage of land and building situated thereon at Gat 232 / 2, Survey No 28, Hissa 1A, measuring 3860 sq mtrs within village Dheku, Taluka Khalapur, District Raigad. b Equitable mortgage of land and building situated thereon at Gat 232 / 1, Survey No 28, Hissa 1A, measuring 3860 sq mtrs within village Dheku, Taluka Khalapur, District Raigad, owned by Sonal Ropes Limited. c Equitable mortgage of property at Ground Floor, C Wing, Bhagwati Building, FP Nos 18 - 19 / 34 A, B, C and 35 A, B, C, TPS VI and CTS No 1610 / 27 and 1610 / 28 of Santacruz West, Linking Road, Extension Road, Mumbai 400 054, owned by Sandeep Arora and Mridu Arora.

d Equitable mortgage of property (Residential Flat) at 11th Floor, Morya Heights, Plot No 15, 16 and 17, Near Sanjeevani International School, Kharghar Sector 18, Navi Mumbai, District Panvel, owned by Sonal Impex Limited

e Equitable mortgage of industrial property situated at Gut No 236 (1), House No 142, Village Dheku, Off Takai - Adoshi Road, Adashi, Khopoli, Raigad, owned by Sonal Impex Limited.

f Hypothecation of existing fixed assets

g Hypothecation of plant and machinery of Sonal Ropes Limited

h Cash collateral or immovable property worth Rs 0.50 crores.

i Third party guarantee of Sandeep Arora, Kamal Arora, Mridu Arora, Corporate Guarantees of Sonal Impex Limited and Sonal Ropes Limited.

j Amount repayable within one year for term loan is Rs 84 lakhs (Previous Year: Rs 84 lakhs).

3. Notes:

1 Section 205 of the Companies Act, 1956 mandates that companies transfer dividend that has been unclaimed for a period of 7 years from unclaimed dividend account to the Investor Education and Protection Fund (''IEPF''). Accordingly, if the dividend is unclaimed for a period of 7 years, it will be transferred to IEPF. The unclaimed dividend pertains to the financial years 2009 - 2010, 2010 - 2011 and 2011 - 2012.

2 Of the above, fixed deposits aggregating to Rs 77.88 lakhs (Previous Year: Rs 14.37 lakhs) have been kept as margin money against working capital facilities availed by the Company. These fixed deposits mature during the next 12 months.

4. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

5. Notes:

1. Figures in italics represent previous year''s amount.

2. Items of a similar nature may be disclosed in aggregate by type of related party except when separate disclosure is necessary for an understanding of the effects of related party transactions on the financial statements of the reporting enterprise. Disclosure of details of particular transactions with individual related parties would frequently be too voluminous to be easily understood. Accordingly, items of a similar nature may be disclosed in aggregate by type of related party. However, this is not done in such a way as to obscure the importance of significant transactions. Hence, purchases or sales of goods are not aggregated with purchases or sales of fixed assets. Nor a material related party transaction with an individual party is clubbed in an aggregated disclosure.

6. Other financial information

6.1 Auditor''s Remuneration

The above fees are exclusive of service tax.

The company takes credit for the service tax on the above payment.

6.2 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2014 together with the interest paid / payable as required under the said Act have not been given.

6.3 No provision has been created on trade receivables aggregating to Rs 28,27,431 (Previous Year: Rs 70,17,053) which are older than six months. Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively atleast at the values disclosed in the balance sheet.

6.4 Cash Flow Statements

Cash-flow statements are prepared in accordance with the "Indirect Method" as explained in the Accounting Standard (AS) 3 - Cash Flow Statements as prescribed under section 211(3C) of the Companies Act 1956 read with General Circular 15 / 2013 dated 13 September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013.

6.5 Cash and Cash Equivalents

Cash and bank balances and current investments that have insignificant risk of change in value, which have durations up to three months, are included in the Company''s cash and cash equivalents in the Cash Flow Statement.


Mar 31, 2013

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

1.2 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31st Mar 2013 together with the interest paid / payable as required under the said Act have not been given.

1.3 The Company submitted audited financial statements to the concerned stock exchanges. Thereafter, an error was noticed in the financial statements due to a software problem. The accounts were subsequently revised and the Board of Directors re-approved the revised financial statements

1.4 No provision has been created on debtors aggregating to Rs 70,17,053 (Previous Year: Rs 1,18,91,411) which are older than six months. Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively at least at the values disclosed in the balance sheet.

1.5 Cash Flow Statements

Cash-flow statements are prepared in accordance with the "Indirect Method" as explained in the Accounting Standard (AS) 3 - Cash Flow Statements as prescribed under section 211(3C) of the Companies Act 1956.

1.6 Cash and Cash Equivalents

Cash and bank balances and current investments that have insignificant risk of change in value, which have durations up to three months, are included in the Company''s cash and cash equivalents in the Cash Flow Statement.


Mar 31, 2012

Note 1 Share capital

1 Term loan is secured against car. The amount repayable within one year is Rs. 4.31 lakhs

2 Represents loan for Cash Credit, Export Packing Credit and Term Loan. The Cash Credit and Export Packing Credit facilities are secured by stock in trade and book debts and other present and future current assets.

The Term Loan is secured by the hypothecation of assets and machineries purchased out of bank finance.

The above loans are also secured by personal guarantee of directors and corporate guarantee of associate concerns

Sonal Impex Limited and Sonal Ropes Limited. The working capital amount is repayable on demand.

The term loan is repayable in 65 monthly installments. Amount payable in one year is Rs. 14 lakhs.

3 Represents 12 years of interest free sales tax deferment payment loan received from the Government of Maharashtra. Repayment has commenced in the financial year 2005 - 2006. The Company has not defaulted on any payment. Repayment is made on the basis of schedule obtained.

The amount repayable within one year is Rs. 2050899 (Previous year: Rs. 2120463).

Note 2

Note:

a) The addition to fixed assets have been classified in accordance with the classification normally adopted by the Management.

b} The additions to fixed assets are exclusive of VAT since the Company claims set off credit for the same (except which cannot be taken as set off.)

c) Motor cycle has been fully depreciated.

d) Of the machines purchased during the year, commercial production on one machine has not commenced. Hence, no depreciation has been claimed for that machine.

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its registered office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

Notes:

1. Figures in italics represent previous year's amount.

2. Items of a similar nature may be disclosed in aggregate by type of related party except when separate disclosure is necessary for an understanding of the effects of related party transactions on the financial statements of the reporting enterprise. Disclosure of details of particular transactions with individual related parties would frequently be too voluminous to be easily understood. Accordingly, items of a similar nature may be disclosed in aggregate by type of related party. However, this is not done in such a way as to obscure the importance of significant transactions. Hence, purchases or sales of goods are not aggregated with purchases or sales of fixed assets. Nor a material related party transaction with an individual party is clubbed in an aggregated disclosure.

2. Other financial information

2.1 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2012 together with the interest paid/payable as required under the said Act have not been given.

2.1 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

2.3 No provision has been created on debtors aggregating to Rs. 15964180 (Previous Year: Rs 1095322). Also, the Management assumes that the other current assets and current liabilities will be realized and settled respectively atleast at the values disclosed in the balance sheet.

Notes:

1. The installed capacity is as certified by the Management and not verified by the auditors, this being a technical matter.

2. Actual production includes production of goods captively consumed.

3. Production figures do not include quantity of product outsourced for production.


Mar 31, 2011

1. Key Management Personnel include Mr Mohan Arora and Mr Sandeep Arora.

2. Relatives to Key Management Personnel include Mona Arora.

3. Remuneration paid to directors is disclosed in Point 3.2 in the Notes to Accounts.

4 Dues to Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers Regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating, to the : amounts unpaid as at 31 Mar 2011 together with the interest paid / payable as required under the said Act have not been given. I

5 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

6 No provision has been created on debtors aggregating to Rs 1095322 (Previous Year: Rs.1674274). Also, the Management assumes that the other current assets and current liabilities will be realized and j settled respectively at least at the values disclosed in the balance sheet.


Mar 31, 2010

1. Nature of business

1.1 The Company is in the business of manufacturing adhesive tapes and plastic ropes. The manufacturing facility of the Company is situated at Khopoli and its administrative office is situated in Andheri (West), Mumbai. The Company exports its products through its associate companies. The Company also gets some part of the manufacturing done from its associate companies on job work basis.

2. Key Management Personnel include Mohan Arora (Managing Director) and Sandeep Arora.

3. Relatives to Key Management Personnel include Mona Arora.

4. Goods are sold on three (3) month credit to non-reiated parties. Four (4) months credit period is generally allowed on sales made to associates.

5. Loans taken from enterprises owned by key management personnel do not stipulate any repayment schedule

6. Goods sold to Sonal Impex Limited are not sold in India and hence there is no price comparison between goods sold to Sonal Impex Limited and goods sold to an unrelated party.

7. Remuneration paid to directors is disclosed in Point 3.2 in the Notes to Accounts.

8, Other financial information

8.1 No whole time company secretary

The Company does not have a whole time company secretary as prescribed by section 383A of the Companies Act, 1956. .

8.2 Micro Small and Medium Enterprises

The Company has not received any intimation from its suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence, the disclosures, if any, relating to the amounts unpaid as at 31 Mar 2010 together with the interest paid / payable as required under the said Act have not been given.

8.3 Balance of debtors, creditors and bank are subject to confirmations from the respective parties.

Notes:

1. The installed capacity is as certified by the Management and not verified by the auditors, this being a technical matter.

2. Actual production includes production of goods captively consumed.

3. Production figures do not include quantity of product outsourced for production.

Note:

The closing stock stated above is after adjustments for in-transit brokerage, obsolete and expired stocks and also for captive consumption.

 
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