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Notes to Accounts of Subros Ltd.

Mar 31, 2016

1. 2 (d) The Company has only one class of equity shares having a par value of Rs.2 per share. Each shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders, 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 proportion to their shareholding.

2(e) There was no change in Equity during the year.

d) Pursuant to the Payment of Bonus (Amendment) Act, 2015, enhanced bonus is to be paid to the eligible employees with retrospective effect from 01.04.2014. Based on various court decisions, the Company has been advised by its legal consultants that the applicability of the said Act for the Year 2014-15 is not likely to stand the trial of the jurisdictional courts. Accordingly, differential amount of Bonus for the year 2014-15 amounting to approximately Rs.192 Lacs has not been accounted for in these financial statements.

e) As advised to the Company, no effect has been given to MAT Recoverable on account of certain disallowances in Income Tax Assessments for earlier years as the company would get full relief in appeals filed against the assessment orders.

2. Contingent Liabilities Not Provided For in respect of :

a) Net Outstanding commitments against Letter of Credits established by the Company: Rs.3,235.28 Lacs (Previous Year Rs.3,966.33 Lacs)

b) Guarantees given by banks on behalf of the Company: Rs.1,463.14 Lacs (Previous Year: Rs. 463.74 Lacs)

c) Claims against the company not acknowledged as debt :-

* Including Raw Materials/Components consumed for production of Fan Motor Assembly. It is not practicable to furnish information of individual components consumed in view of very large number of items consumed.

This provision is expected to be utilized for settlement of warranty claims within a period of 2 years.

3. The company has identified that there is no material impairment of assets and as such no provision is required in terms of Accounting Standard-28 on "Impairment of Assets".

4. Segment Reporting

The Company''s business activity falls within a single primary business segment i.e, Automotive Air-conditioning Systems and parts thereof. Export sales constitute an insignificant portion of the total business of the Company. Hence, there is no geographical segment as well. Therefore, the disclosure requirements of Accounting Standard – 17 on ''Segment Reporting'' are not applicable.

5. Related Party Disclosures

In terms of Accounting Standard - 18 on "Related party Disclosures", the particulars of transactions with related parties are given as under: a) Name of related parties and description of relationship (as certified by the management & relied upon by the auditors):- i) Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

- Mr. D.M.Reddy, Executive Director

- Mr. Manoj Kumar Sethi- Senior Vice President - Finance

- Mr. Hemant Kumar Agarwal- Deputy Company Secretary & General Manager - Finance ii) Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri)

- Ms. Lohitha Reddy (Daughter of Mr. D.M. Reddy) iii) Subsidiary Company

- Thai Subros Ltd., Thailand iv) Joint Venture

- Denso Subros Thermal Engineering Centre India Ltd. (DSEC)

v) Entities over which Key Management Personnel or their relatives are able to exercise significant influence:

- SHS Transport (P) Ltd. -Rohan Motors Limited

- Hemkunt Service Station (P) Ltd. - Tempo Automobiles (P) Ltd.

- M/s. Ramesh Suri (HUF) -Prima Telecom Ltd.

- Prima Infratech Pvt Ltd. -Fibcom India Ltd.

6. Monthly Remuneration paid to the Executive Directors during the year as minimum remuneration as approved by the Shareholders has exceeded the limits prescribed u/s 197 read with ScheduleV of the Companies Act, 2013 byanaggregate amount of Rs 157.10 Lacs (Previous Year of Rs. 55.36 Lacs). The Company has already sought/is in the process of seeking requisite approvals from the Central Government. The company will take appropriate steps to recover the said excess amount from the concerned Directors in case requisite approvals are not granted by the Central Government.

b) Provision for taxation has been made after taking into account the benefit available on expenditure incurred on R & D Centers. Such expenditure are subject to approval of appropriate authorities.

7. Earnings per Share

In accordance with Accounting Standard - 20 on ''Earning per Share'' issued by the Institute of Chartered Accountants of India, the Earning per Share has been computed asunder:

8. Borrowing cost amounting to Rs.515.00 lacs (Previous Year : 1,046.18 lacs) has been capitalized with the cost of fixed assets as per Accounting Standard 16 on "Borrowing Cost".

9. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

Defined Benefit Plan

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary as considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in employment market. The above information is certified by the Actuary.

The expected rate of return on plan assets is determined considering the policy for plan assets management and past returns.

10. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development)Act, 2006".

11. (i) The Company does not have pending litigations which would impact its Financial Position.

(ii) The Company do not have any Long term Contracts including derivative contracts which require any provision for Force able Losses. (iii) The Company has deposited an amount of Rs 4.60 Lacs (Previous Year Rs. 6.51 Lacs) during the year in Investor Education and Protection Fund. Further, no amount is pending for deposition in Investor Education and Protection Fund.

12. Balance confirmations have not been received from some of the parties showing debit/credit balances. Management does not expect to have any material differences affecting the financial statements for the year upon confirmation.

13. Previous year''s figures have been regrouped/rearranged wherever considered necessary to confirm to this year''s classification.


Mar 31, 2015

Ii) Figures in brackets represent cash outflows.

iii) Previous years figures have been recast/restated wherever necessary.

2 (d) The Company has only one class of equity shares having a par value of Rs.2 per share. Each shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders, 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 proportion to their shareholding.

3. Contingent Liabilities Not Provided For in respect of:

a) Net Outstanding commitments against Letter of Credits established by the Company: Rs.3,966.33 Lacs (Previous Year Rs.4,916.86 Lacs)

b) Guarantees given by banks on behalf of the Company: Rs.463.74 Lacs (Previous Year: Rs. 736.29 Lacs)

c) Claims against the company not acknowledged as debt :-

( Rs in Lacs) As at As at Nature of Claim 31.03.15 31.03.14

Disputed Sales Tax Demands 139.36 139.36

Disputed Income Tax Demands 24.40 —

Other claims 83.16 77.25

d) As advised to the company, no effect has been given to MAT Recoverable on account of certain disallowances in Income Tax Assessment for earlier year as the company would get full relief in appeal filed against the assessment order

4. Estimated value of contracts on capital account remaining to be executed and not provided for (net of advances) Rs. 2,052.62 Lacs. (Previous Year: Rs. 1,787.17 Lacs).

5. In the opinion of Board, the value on realization of current assets, loans and advances in the ordinary course of business shall not be less than the amount at which they are stated in the balance sheet and provision for all known liabilities has been made and contingent liabilities disclosed properly.

* Including Raw Materials/Components consumed for production of Fan Motor Assembly. It is not practicable to furnish quantitative information of individual components resume in view of the considerable no. of items.

6. The company has identified that there is no material impairment of assets and as such no provision is required in terms ofAccounting Standard-28 on "Impairment of assets".

7. Segment Reporting

The Company's business activity falls within a single primary business segment i.e., Automotive Air conditioning Systems and parts thereof. Export sales constitute an insignificant portion of the total business of the company. Hence, there is no geographical segment as well.

Therefore, the disclosure requirements ofAccounting Standard 17 on 'Segment Reporting' are not applicable.

8. Related Party Disclosures

In terms of Accounting Standard 18 on "Related party Disclosures", the particulars of transactions with related parties are given as under:

a) Name of related parties and description of relationship (as certified by the management & relied upon by the auditors):-

i. Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

- Mr. D. M. Reddy, Executive Director

ii. Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri)

- Ms. Lohitha Reddy (Daughter of Mr. D. M. Reddy)

- Ms. Likhitha Reddy (Daughter of Mr. D. M. Reddy)

iii. Subsidiary Company

- Thai Subros Ltd., Thailand

iv. Joint Venture Company

- Denso SubrosThermal Engineering Centre India Ltd. (DSEC)

v. Entities over which Key Management Personnel or their relatives are able to exercise significant influence:

- SHSTransport (P) Ltd.

- Rohan Motors Limited

- Hemkunt Service Station (P) Ltd.

- TempoAutomobiles (P) Ltd.

- M/s. Ramesh Suri (HUF)

- PrimaTelecom Ltd.

- Prima Infratech (P) Ltd.

- Fibcom India Ltd.

9. Monthly remuneration has been paid during the year to the Managing Director as minimum remuneration as approved by the Shareholders, but eventually the same has exceeded the limits prescribed u/s 197 read with Schedule V of the Companies Act, 2013 by a small amount of Rs.55.36 Lacs (Previous Year of Rs. 61.15 Lacs). The Company is in the process on filing an application to get the waiver from Central Government.

10. Industrial Promotion Subsidy received/receivable under Packaged Scheme of Incentives, 2007 is accounted for on the basis of approval received from the Government of Maharashtra.

11. Research and Development Expenses

a) The company has two Inhouse R & D Centres, approved by the Department of Scientific and Industrial Research, Ministry of Science & Technology, Govt. of India. The detail of expenditure /income incurred/earned during the year by the said R&D Centres is as under :-

b) Provision for taxation has been made after taking into account the benefit available on expenditure incurred on R & D Centers. Such expenditure are subject to approval of appropriate authorities.

12. Earning per Share

In accordance with Accounting Standard - 20 on 'Earning per Share' issued by the Institute of Chartered Accountants of India, the Earning per Share has been computed asunder:

13. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

14. Following Construction/Development Period Expenses (other than Borrowing Cost) incurred on making Dies & Tools and Building and developing New product/ Technology have been capitalized or clubbed with Capital Work in-Progress, as the case maybe :- „ lqcs 15. Borrowing cost amounting to Rs.1046.18 lacs (Previous Year: 831.38 lacs) has been capitalized with the cost of fixed assets as per Accounting Standard 16.

16. Employees Benefits

As per Accounting Standard 15 "Employee Benefits", the required disclosures of Employee Benefits to the extent applicable to the company are given below:

Defined Contribution Plan

Contribution to Defined Contribution Plan, recognized as expense for the year are as under:

Defined Benefit Plan

The employees' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary as considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in employment market. The above information iscertified by the actuary.

The expected rate of return on plan assets is determined considering the LIC's policy for plan assets management.

17. i. The Company does not have pending litigations which would impact its Financial Position.

ii. The Company does not have any Long term Contracts including derivative contracts which require any provision for Forceable Losses.

iii. The Company has deposited an amount of Rs 6.51 Lacs during the year in Investor Education and Protection Fund. Further, no amount is pending for deposition in Investor Education and Protection Fund.

18. Pursuant to the enactment of the Companies Act 2013, the company has applied the estimated useful lives as specified in schedule II, except in respect of certain assets as disclosed in Accounting Policy on Depreciation. Accordingly unamortised carrying value is being depreciated/ amortised over the revised/remaining useful lives w.e.f. 01st April 2014.This has resulted into depreciation and amortisation expenses for the Year ended 31st March, 2015 being lower by Rs. 483.58 lacs.

19. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development) Act, 2006".

20. Balance confirmations have not been received from some of the parties showing debit/credit balances.

21. Previous year figures have been regrouped /rearranged wherever considered necessary.


Mar 31, 2014

1. Contingent Liabilities Not Provided For in respect of :

a) Net Outstanding commitments against Letter of Credits established by the Company: Rs.4,916.86 Lacs (Previous Year Rs.6,380.57 Lacs)

b) Guarantees given by banks on behalf of the Company: Rs.736.29 Lacs (Previous Year: Rs. 161.64 Lacs)

c) Claims against the company not acknowledged as debt :-

(Rs. in Lacs)

As at As at

Nature of Claim 31.03.14 31.03.13

Disputed Sales Tax Demands 139.36 138.63

Other claims 77.25 70.80

d) As advised to the company, no effect has been given to AAAT Recoverable on account of certain disallowances in Income Tax Assessment for earlier year as the company would get full relief in appeal filed against the assessment order

2. Estimated value of contracts on capital account remaining to be executed and not provided for (net of advances) Rs 1,787.17 Lacs. (Previous Year: Rs. 2,626.30 Lacs).

3. In the opinion of Board, the value on realization of current assets, loans and advances in the ordinary course of business shall not be less than the amount at which they are stated in the balance sheet and provision for all known liabilities has been made and contingent liabilities disclosed properly.

4. There were no reportable lease arrangements as defined in Accounting Standard-19

This provision is expected to be utilized for settlement of warranty claims within a period of 2 years.

5. The company has identified that there is no material impairment of assets and as such no provision is required in terms of Accounting Standard-28 on ''Impairment of assets''.

6. Segment Reporting

The Company''s business activity falls within a single primary business segment i.e., Automotive Air conditioning Systems and parts thereof. Export sales constitute an insignificant portion of the total business of the company. Hence, there is no geographical segment as well. Therefore, the disclosure requirements of Accounting Standard -17 on ''Segment Reporting'' are not applicable.

7. Related Party Disclosures

In terms of Accounting Standard - 18 on ''Related Party Disclosures'', the particulars of transactions with related parties are given as under:

a) Name of related parties and description of relationship (as certified by the management & relied upon by the auditors):-

i) i. Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

- Mr. D. M. Reddy, Executive Director

ii) Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri)

- Ms. Lohitha Reddy (Daughter of Mr. D. M. Reddy)

- Ms. Likhitha Reddy (Daughter of Mr. D. M. Reddy)

iii) Subsidiary Company

- Thai Subros Ltd., Thailand

iv) Joint Venture Company

- Denso Subros Thermal Engineering Centre India Ltd. (DSEC)

v) Entities over which Key Management Personnel or their relatives are able to exercise significant influence:

- SHS Transport (P) Ltd.

- Rohan Motors Limited

- Hemkunt Service Station (P) Ltd.

- Tempo Automobiles (P) Ltd.

- M/s. Ramesh Suri (HUF)

- Prima Telecom Ltd.

- Prima Infratech (P) Ltd.

- Fibcom India Ltd.

8. Monthly remuneration has been paid during the year to the Managing Director as minimum remuneration as approved by the Shareholders, but eventually the same has exceeded the limits prescribed u/s 309 of the Companies Act, 1956 by a small amount of Rs. 61.15 Lacs (Previous Year of Rs.20.11 Lacs). The Company has filed applications to get the waiver from Central Government for which approvals are awaited.

9. Industrial Promotion Subsidy received/receivable under Packaged Scheme of Incentives, 2007 is accounted for on the basis of approval for disbursements received from the Government of Maharashtra.

10. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

11. Borrowing cost amounting to Rs. 831.38 Lacs (Previous Year: Rs. 633.30 Lacs) has been capitalised with the cost of fixed assets as per Accounting Standard 16 on ''Borrowing Cost''.

12. Employees Benefits

As per Accounting Standard 15 "Employee Benefits", the required disclosures of Employee Benefits to the extent applicable to the company are given below:

Defined Benefit Plan

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary as considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering the LIC''s policy for plan assets management.

13. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development) Act, 2006".

14. Balance confirmations have not been received from some of the parties showing debit/credit balances.

15. Previous years figure have been regrouped/rearranged wherever considered necessary.


Mar 31, 2013

1. Contingent Liabilities Not Provided For in respect of :

a) Net Outstanding commitments against Letter of Credits established by the Company: Rs.6380.57 Lakhs (PreviousYearRs.8,956.50 Lakhs)

b) Guarantees given by banks on behalf of the Company: Rs 161.64 Lakhs (Previous Year: Rs. 355.66 Lakhs)

c) Claims against the company not acknowledged as debt :-

2. Estimated value of contracts on capital account remaining to be executed and not provided for (net of advances): Rs.2,626.30 Lakhs (Previous Year: Rs. 5,051.64 Lakhs).

3. In the opinion of Board, the value on realization of current assets, loans and advances in the ordinary course of business shall not be less than the amount at which they are stated in the balance sheet and provision for all known liabilities has been made and contingent liabilities disclosed properly.

4. There were no reportable lease arrangements as defined in Accounting Standard-19

5. The company has identified that there is no material impairment of assets and as such no provision is required in terms of Accounting Standard-28 issued by the Institute of Chartered Accountants of India.

6. Segment Reporting

The Company''s business activity falls within a single primary business segment i.e., Automotive Air conditioning Systems and parts thereof. Export sales constitute an insignificant portion of the total business of the company. Hence, there is no geographical segment as well. Therefore, the disclosure requirements of Accounting Standard - 17 on ''Segment Reporting'' issued by the Institute of Chartered Accountants of India are not applicable.

7. Related Party Disclosures

In terms of Accounting Standard -18 issued by the Institute of Chartered Accountants of India, the particulars of transactions with related parties are given as under:

a) Name of related parties and description of relationship (as certified by the management & relied upon by the auditors): - i) Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

- Mr. D. M. Reddy, Executive Director

ii) Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri)

- Ms. Lohitha Reddy (Daughter of Mr. D. M. Reddy)

- Ms. Likhitha Reddy (Daughter of Mr. D. M. Reddy)

iii) Subsidiary Company

- Thai Subros Ltd., Thailand

iv) Joint Venture Company

- Denso Subros Thermal Engineering Centre India Ltd. (DSEC)

v) Entities over which Key Management Personnel or their relatives are able to exercise significant influence:

- SHS Transport (P) Ltd.

- Rohan Motors Limited

- Hemkunt Service Station (P) Ltd.

- Tempo Automobiles (P) Ltd.

- M/s. Ramesh Suri (HUF)

- Prima Telecom Ltd.

- Prima Infratech (P) Ltd.

- Fibcom India Ltd.

8. Monthly remuneration has been paid during the year to the Managing Director as minimum remuneration as approved by the Shareholders, but eventually the same has exceeded the limits prescribed u/s 309 of the Companies Act, 1956 by a small amount of Rs.20.11 Lacs. The Company is in the process of filing an application to get the waiver from Central Government.

9. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

b) Forward Exchange Contracts entered into by the Company outstanding at the year end:-

10. Research & Development Expenses

a) The company has two In house R&D Centres, approved by the Department of Scientific and Industrial Research, Ministry of Science & Technology, Govt, of India. The detail of revenue expenditure /income incurred/earned during the year by the said R&D Centres and charged to Statement of Profit & Loss Account or capitalized/ to be capitalized is as under: -

b) Provision for taxation has been made after taking into account the benefit available on expenditure incurred on R & D Centres. Such expenditure are subject to approval of appropriate authorities.

11. Following Construction Period Expenses (other than Borrowing Cost) incurred on making Dies & Tools and Building have been capitalized or clubbed with Capital Work in-Progress, as the case may be:-

12. Borrowing cost amounting to Rs. 633.30 lakhs (Previous Year: Rs. 389.25 lakhs) has been capitalised with the cost of fixed assets as per Accounting Standard 16 issued by the Institute of Chartered Accountant of India.

13. Employees Benefits

As per Accounting Standard 15 "Employee Benefits", the required disclosures of Employee Benefits to the extent applicable to the company are given below:

Defined Contribution Plan

Contribution to Defined Contribution Plan, recognized as expense for the year are as under:

Defined Benefit Plan

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary as considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering the LIC''s policy for plan assets management.

14. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development) Act, 2006".

15. Balance confirmations have not been received from some of the parties showing debit/credit balances.


Mar 31, 2012

1(a The Company has only one class of equity shares having a par value of Rs.2/- per share. Each shareholder is eligible for one vote per share. The dividend proposed by the Board of Directors is subject to the approval of shareholders, 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 proportion to their shareholding.

NATURE OF SECURITY

Term loan amounting to Rs. NIL (March 31, 2011: Rs. 1406.25 lacs) is secured by Exclusive first charge on specific equipment.

Term loan amounting to Rs. 260.00 lacs (March 31, 2011: Rs. 390.00 lacs) is secured by Exclusive first charge on specific equipment.

Term loan amounting to Rs. 2175.00 lacs (March 31, 2011: Rs. NIL) is secured by Exclusive first charge on specific equipment.

Term loan amounting to Rs. NIL (March 2011: Rs. 290.90 lacs) is secured by Equitable Mortgage on Manesar Land 6t Bldg., Personal Gurarantee of Mr Ramesh Suri & specific assets.

Term loan amounting to Rs. 3186.03 lacs (March 2011: Rs. 4602.05 Lacs) is secured by Equitable Mortgage on Manesar Land fit Bldg., Personal Gurarantee of Mr Ramesh Suri & specific assets.

Term loan amounting to Rs. 1400.00 lacs (March 2011: Rs. Nil) is secured by is secured by Equitable Mortgage on Manesar Land & Bldg., Personal Gurarantee of Mr Ramesh Suri & specific assets.

Term loan amounting to Rs. 577.00 lacs (March 31, 2011: Rs. 865.50 Lacs) is secured by Exclusive first charge on specific equipment

Term loan amounting to Rs. 376.87 lacs (March 31, 2011: Rs. Nil) is secured by Exclusive first charge on specific equipment

Term loan amounting to Rs. 5582.50 lacs (March 31, 2011: Rs. Nil) is secured by Exclusive first charge on specific equipment

Vehicle loan amounting to Rs. 52.21 lacs (March 31, 2011: Rs 116.53 lacs) is secured by Hypothecation on specific vehicles

TERMS OF REPAYMENT

Repayment in 16 quarterly installments (@ 140.62 lacs each) commencing from December 2010. Last installment in September 2014. Rate of interest 12.07% P.A. as at year end. (Previous year 8.75% P.A.)

Repayment in 20 quarterly installments (@ 32.50 lacs each) commencing from June 2010. Last installment in September 2014. Rate of interest 11.90% P.A. as at year end. (Previous year 9.00% P.A.)

Repayment in 16 quarterly installments (@ 181.25 lacs each) commencing from June 2012. Last installment in March 2016. Rate of interest 11.90% P.A. as at year end. (Previous year NA %P.A.)

Repayment in 11 quarterly installments (@ 290.91 lacs each) commencing from December 2009. Last installment in June 2012. Rate of interest 9.00% P.A. as at year end. (Previous year 9.00% P.A.)

Repayment in 16 quarterly installments (@ 354.00 lacs each) commencing from Aug 2010. Last installment in May 2015. Rate of interest KBR 0.075% P.A. as at year end. (Previous year KBR 0.075% P.A.)

Repayment in 36 monthly installments (@ 58.33 lacs each) commencing from April 2012. Last installment in March 2015. Rate of interest KBR 1% P.A. as at year end. (Previous year N.A.)

Repayment in 16 quarterly installments (@ 72.13 lacs each) commencing from June 2011. Last installment in March 2015. Rate of interest 11.77% P.A. as at year end. (Previous year 11.77% P.A.)

Repayment in 16 quarterly installments (@ 41.87 lacs each) commencing from Aug 2011. Last installment in February 2015. Rate of interest 11.77% P.A. as at year end. (Previous year N.A.)

Repayment in 16 quarterly installments (@ 348.91 lacs each) commencing from June 2013. Last installment in March 2017. Rate of interest 9.70% P.A. as at year end. (Previous year N.A.)

Repayment in 84 equated Monthly commencing from October, 2007. Rate of interest 8.50% P.A.

1 Contingent Liabilities Not Provided For in respect of:

a) Net Outstanding commitments against Letter of Credits established by the Company: Rs.8956.50 lacs (Previous Year Rs.6,537.80 lacs)

b) Guarantees given by banks on behalf of the Company: Rs 355.66 lacs (Previous Year: Rs. 458.08 lacs)

c) Claims against the company not acknowledged as debt :-

2 Estimated value of contracts on capital account remaining to be executed and not provided for (net of advances): Rs.5051.64 lacs (Previous Year: Rs.6,382.66 lacs).

3 In the opinion of Board, the value on realisation of current assets, loans and advances in the ordinary course of business shall not be less than the amount at which they are stated in the balance sheet and provision for all known liabilities has been made and contingent liabilities disclosed properly.

* Including Raw Materials/Components consumed for production of Fan Motor Assembly.

** It is not practical to furnish quantitative information of individual component consumed in view of the considerable number of items.

4. The company has identified that there is no material impairment of assets and as such no provision is required in terms of Accounting Standard-28 issued by the Institute of Chartered Accountants of India.

5. Segment Reporting

The Company's business activity falls within a single primary business segment i.e, Automotive Air conditioning Systems (with or without Fan Motor Assembly) and parts thereof. Export sales constitute an insignificant portion of the total business of the company. Hence, there is no geographical segment as well. Therefore, the disclosure requirements of Accounting Standard - 17 on 'Segment Reporting' issued by the Institute of Chartered Accountants of India are not applicable.

6. Related Party Disclosures

In terms of Accounting Standard - 18 issued by the Institute of Chartered Accountants of India, the particulars of transactions with related parties are given as under:

a) Name of related parties and description of relationship (as certified by the management & relied upon by the auditors):-

i) Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

ii) Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri)

iii) Subsidiary Company

- Thai Subros Ltd., Thailand

iv) Joint Venture Company

- Denso Subros Thermal Engineering Centre India Ltd. (DSEC)

v) Entities over which Key Management Personnel or their relatives are able to exercise significant influence: , ,

- SHS Transport (P) Ltd.

- Rohan Motors Limited

- Hemkunt Service Station (P) Ltd.

- Tempo Automobiles (P) Ltd.

- M/s. Ramesh Suri (HUF)

- Prima Telecom Ltd.

- Fibcom India Ltd.

7. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

8. Research & Development Expenses

a) The company has an In house R & D Centre, approved by the Department of Scientific and Industrial Research, Ministry of Science & Technology, Govt, of India. The detail of revenue expenditure /income incurred/earned during the year by the said R & D Centre and charged to Statement of Profit & Loss Account or capitalized/ to be capitalized is as under:-

b) Other expenditure on Research & Development activities charged to statement of Profit & loss:- Rs: Nil (Previous Year: Rs. 1.92 lacs)

c) Provision for taxation has been made after taking into account the benefit available on expenditure incurred on R & D Centre. Such expenditure are subject to approval of appropriate authorities.

9. Borrowing cost amounting to Rs. 389.25 lacs (Previous Year: 257.56 lacs) has been capitalised with the cost of fixed assets as per Accounting Standard 16 issued by Institute of Chartered Accountant of India.

10. Employees Benefits

As per Accounting Standard 15 "Employee Benefits", the required disclosures of Employee Benefits to the extent applicable to the company are given below:

Defined Benefit Plan

The employees' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

The estimates of rate of escalation in salary as considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors including supply and demand in employment market. The above information is certified by the actuary.

The expected rate of return on plan assets is determined considering the LIC's policy for plan assets management.

11. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development) Act, 2006".

12. Balance confirmations have not been received from some of the parties showing debit/credit balances.

13. The Financial statements for the year ended March 31,2011 had been prepared as per the then applicable pre revised Schedule VI of the Companies Act, 1956, The financial statements for the year ended on March 31, 2012 are prepared under revised Schedule VI. Accordingly, the previous year figures have also been reclassified to conform to this year's classification.


Mar 31, 2010

1. Contingent Liabilities Not Provided For in respect of:

a) Outstanding commitments against Letter of Credits established by the Company: Rs.9745.25 Lacs (Previous Year Rs.6264.59 Lacs)

b) Guarantees given by banks on behalf of the Company: Rs 440.05 Lacs (Previous Year: Rs. 412.29 Lacs)

c) Claims against the company not acknowledged as debt :-

As at As at

Nature of Claim 31.03.10 31.03.09

(Rupees in Lacs)

i) Disputed Sales Tax Demands -Gross 149.93 70.19

-Net of tax 98.97 46.33

ii) Disputed Demand under Income Tax Act 12.95 90.23

iii) Other claims -Gross 45.32 95.27

-Net of tax 29.92 62.89

2. Estimated value of contracts on capital account remaining to be executed and not provided for (net of advances): Rs.2324.91 Lacs (Previous Year: Rs.458.91 Lacs).

3. In the opinion of Board, the value on realisation of current assets, loans and advances in the ordinary course of business shall not be less than the amount at which they are stated in the balance sheet and provision for all known liabilities has been made and contingent liabilities disclosed properly.

4. The company has identified that there is no material impairment of assets and as such nc provision is required in terms of Accounting Standard-28 issued by the Institute of Charterec Accountants of India.

5. Segment Reporting

The Companys business activity falls within a single primary business segment i.e, Automotive Airconditioning Systems (with or without Fan Motor Assembly) and parts thereof. Export sale: constitute an insignificant portion of the total business of the company. Hence, there is nc geographical segment as well. Therefore, the disclosure requirements of Accounting Standard- 17 on Segment Reporting issued by the Institute of Chartered Accountants of India are not applicable.

6. Related Party Disclosures

In terms of Accounting Standard 18 issued by the Institute of Chartered Accountants of Indie the particulars of transactions with related parties are given as under:

a) Name of related parties and description of relationship (as certified by the management relied upon by the auditors): - i) Key Management Personnel

- Mr. Ramesh Suri, Chairman

- Ms. Shradha Suri, Managing Director (Daughter of Mr. Ramesh Suri)

ii) Relatives of Key Management Personnel

- Mrs. Ritu Suri (Wife of Mr. Ramesh Suri) iii) Subsidiary Company

- Thai Subros Ltd., Thailand

iv) Entities over which Key Management Personnel or their relatives are able to exercis significant influence:

- SHS Transport (P) Ltd.

- Rohan Motors Limited

- Hemkunt Service Station (P) Ltd.

- Tempo Automobiles (P) Ltd.

- M/s. Ramesh Suri (HUF)

- Prima Telecom Ltd.

- Fibcom India Ltd.

7. Foreign Exchange Differences

a) The company has entered into foreign exchange forward contracts to partly hedge its risks associated with the foreign currency fluctuations relating to firm commitments.

d) Exchange gain/(loss) accounted during the year:

i) Exchange Gains/(Loss) credited Gain Rs.442.64 Lacs

to Profit and LossAccount (Previous Year Loss Rs.243.40 Lacs)

ii) Difference between forward rates and Rs.10.54 Lacs

spot rates to be recognised in (Previous Year Rs. 1.18 Lacs) subsequent years

8. Research ft Development Expenses

c) Provision for taxation has been made after taking into account the benefit available on expenditure incurred on R 6t D Centre. Such expenditure are subject to approval of appropriate authorities.

Defined Benefit Plan

The employees gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

9. Borrowing cost amounting to Rs. 120.37 lacs (Previous Year: 119.54 lacs) has been capitalised with the cost of fixed assets as per Accounting Standard 16 issued by Institute of Chartered Accountant of India.

10. As informed there was no supplier who was registered under "The Micro, Small and Medium Enterprises (Development) Act, 2006".

11. Balance confirmations have not been received from some of the parties showing debit/credit balances.

13. Previous years figures have been wherever considered necessary to confirm to this years classification.

 
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