Home  »  Company  »  Sunflag Iron  »  Quotes  »  Notes to Account
Enter the first few characters of Company and click 'Go'

Notes to Accounts of Sunflag Iron & Steel Company Ltd.

Mar 31, 2018

Notes forming part of the Financial Statements for the yearended 31st March, 2018

1. Corporate information

Sunflag Iron and Steel Company Limited (the ‘Company’) was incorporated in 1984 and is engaged in the business of manufacturing and sale of Special Steel Rolled products. The Company is listed on BSE Limited (BSE) and The National Stock Exchange of India Limited (NSE).

The registered office of the Company is situated at 33, Mount Road, Sadar, Nagpur-440001, Maharashtra, India.

These financial statements are presented in Indian Rupees (Rs.)

Notes:

I) Addition to capital work in progress include Rs. Nil of the finance cost capitalised during the year (Previous year Rs. Nil),

ii) Cost of Leasehold land is amortised over the period of lease i.e. 95 years.

in) The Company has elected to measure the items of Property, plant and equipment at their cost on the date of transition.

Additional information Asset under construction

Capital work in progress incurred as at 31st March, 2018 amounted Rs. 10,759 lakhs (Previous year, Rs. 4,625 lakhs) in view of implementation of new projects viz.

I) New sinter plant ii) Induction Furnace iii) Continuous Finishing Line

iv) Ingot Caster v) Transit House at Bhandara

All creditors towards CWIP has been classified under other financial liabilities and it also includes project inventory as at the year end. Impairment review

Assets are tested for impairment whenever there are any internal or external indicators of impairment. Impairment test is performed at the level of each Cash Generating Unit (‘CGU’) or groups of CGUs within the Company at which the assets are monitored for internal management purposes, within an operating segment. The impairment assessment is based on higher of value in use and value from sale calculations. During the year, the testing did not result in any impairment in the carrying amount of other assets. The measurement of the cash generating units’value in use is determined based on financial plans that have been used by management for internal purposes. The planning horizon reflects the assumptionsforshort to mid-term market conditions.

Key assumptions used in value-in-use calculations:- Operating margins (Earnings before interest and taxes); Discount rate; Growth rates; Capital expenditures.

Pursuant to the Supreme Court Order dated 24th September, 2014, the Coal Block allocated to the Company with other Shareholders/Joint Venture partners in the names of Khappa Coal Company Private Limited Madanpur (North) Coal Co. Private Limited and CT Mining Private Limited, stands cancelled. Subsequent to the cancellation of previous allocation, the Government of India, Ministry of Law and Justice (Legislative Department) has promulgated. The Coal Mines (Special Provisions) Act, 2015 for implementing the order of Supreme Court and fixation of compensation etc to the prior allottees. But the process of re-allotment and crystallization of compensation amount in respect of the below Company’s mines, is pending, as the re-auctioning process of these mines are not yet completed. In view of belowsaid, the Company has not recognized any amount towards diminution in the value of the investments made in the Subsidiaries and Joint Venture companies.

a) Terms/Voting Rights attached to the Equity Shares

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion of the number of the Equity shares held by the Shareholders.

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 ownerships of shares.

d) The company has neither issued any bonus share or share for consideration other than cash neither bought back any shares during the period of five years immediately preceeding the reporting date.

I. Term Loans from Banks are Secured by a first mortgage of the Company’s Immovable properties situated at Village Warthi, District Bhandara, both present and future ranking pari passu interse and a first charge by way of hypothecation of all the company’s movables subject to prior charges created in favour of Company’s bankers on inventories, book debts and other movables for securing the borrowings for working capital requirement.

ii. Term loan of Rs. 7,500 lakhs (outstanding Rs. 6,963 lakhs) borrowed from State Bank of India is further secured by Personal Guarantee of Shri Ravi Bhushan Bhardwaj, Chairman of the Company.

iii. The Company has not defaulted in repayment of principle and interest during the year.

iv. The Unsecured loans comprising term loans given by Promoters are interest free. There is no stipulation as to the repayment hence there is no default has occurred in repayment during the period.

v. The Unsecured loans comprising Interest free Sales Tax Loan valued on NPV basis. Actual liability isRs. 3,254 lakhs. The repayment of the sales tax loan is made as per the schedule and no default has occurred in repayment during the period.

i. Working capital borrowings are secured by way of hypothecation of Inventories and book debts and further secured byway of second charge ranking pari passu over the fixed assets situated at Village Warthi, District Bhandara both present and future, subject to prior charges created by the Company in favour of banks for securing term loan. Working capital borrowings are secured by the personal guarantee of Shri Ravi Bhushan Bhardwaj, Chairman of the Company.

ii. Intreset on working capital loan from Banks are charged at respective bank’s MCLR plus 50 -100 bps

Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management. Moreover the Company is in the process of updating its suppliers data, as to the status as a Micro Small & Medium Enterprise with a copy of the Memorandum filed as per the provisions of Section 8 of the Micro, Small & Medium Enterprises Development Act, 2006.

2. Disclosure under Regulation 34 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015

Details of loans and advances in nature of loans to subsidiaries, parties in which Directors are interested and investments by the loanee in the shares of the Company as required by clause 34(3) of SEBI (Listing Obligations and Disclosure Requirements) Regulation 2015:

3.Segment information

The Company has only one operating segment i.e. ‘Iron & Steel Business’ and operations are mainly within India. Hence, it is the only reportable segment under Ind AS-108 ‘Operating Segments’.

Entity wise disclosure required by Ind AS-108 are made as follows:

4. Operating Lease

Operating lease commitments - Company as lessee

The Company has entered into cancellable lease agreements for godowns and office premises. Some of the lease agreements contain escalation clause ofupto 10% There are no restrictions placed upon the Company by entering into these leases.

5. Capital management

For the purpose of the Company’s capital management, equity includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders and net debt includes interest bearing loans and borrowings less current investments and cash and cash equivalents. The primary objective of the Company’s capital management is to safeguard continuity, maintain a strong credit rating and healthy capital ratios in order to support its business and provide adequate return to shareholders through continuing growth.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial convenants. The funding requirement is met through a mixture of equity, internal accruals, long term borrowings and short term borrowings. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt.

In order to achieve this overall objective, the Company’s capital management amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements.

To maintain or adjust the capital structure, the Company review the fund management at regular intervals and take necessary actions to maintain the requisite capital structure.

No changes were made in the objectives policies or processes for managing capital during the years ended 31st March 2018, 31stMarch 2017.

6. Subsequent events: There are no reportable events

The Company have received an intimation from the Nominated Authority, Ministry of Coal, Government of India, for appropriation of Performance Bank guarantee to the extent of Rs. 21.38 Crores in view of non-compliance of production schedule in terms Coal Mine Development and Production Agreement in respect of Belgaon Coal Mine. However, the Company filed a writ petition in the Hon’ble High Court at Delhi and after hearing the matter on 3rd May, 2018, the Hon’ble High Court directed the Company to file an appeal in the Special Tribunal at Nagpur within two weeks. Accordingly the Company filed an appeal on 8th May, 2018 and the matter is yet to be heard. However, as a matter of prudence, necessary provision has been made as at the Balance sheet date 31 stMarch, 2018.

7. Employee benefit plans

Employee Provident Fund, the Company has made good the shortfall of interest on fund Nil. (Previous Year Nil).

a) The investment details of Gratuity funds are as per the Scheme of Life Insurance Corporation of India (LIC).

b) The investment details of Superannuation funds are as per the Scheme of Life Insurance Corporation of India (LIC) under two plans. Even though these plans are still continuing, Company has stopped making contribution towards One plan i.e. Superannuation Scheme of Workers w.e.f. 01.04.1995 on payment of bonus in the year 1995 as per the terms and conditions of Rules framed at the time of subscribing to the designated policy of LIC. Company was liable as per terms and conditions of the Trust deed to pay contributions only till applicability of provisions of payment of Bonus Act.

8. Related Party Disclosure (as Identified by the Management)

In accordance with the requirements of Ind AS-24, on related party disclosures name of the related party, related party relationship, transactions and outstanding balances including commitments where control exists and with whom transactions have taken place during reporting periods.

The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties in an orderly market transaction, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values.

i) The fair values of derivatives are on MTM as per Bank

ii) Company has opted to fairvalue its Long term and Current investments through profit & loss

iii) Company has adopted effective rate of interest for calculating Interest. This has been calculated as the weighted average of effective interest rates calculated for each loan. In addition processing fees and transaction cost relating to each loan has also been considered for calculating effective interest rate.

Fairvalue hierarchy

Level 1 - Quoted prices (unadjusted) inactive markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level-1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs forthe assets or liabilities that are not based on observable market data (unobservable inputs).

9.Financial Risk Management

Financial riskfactors

The Company’s principal financial liabilities, other than derivatives, comprise borrowings, trade and other payables, and financial guarantee contracts. The main purpose of these financial liabilities is to manage finances for the Company’s operations. The Company has loan, investment, trade receivables, other receivables, cash and short-term deposits that arise directly from its operations.

The Company is exposed to market risk, credit risk and liquidity risk. The Company’s senior management oversees the management of these risks and also ensure that the Company’s financial risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Company’s policies and risk objectives. It is the Company’s policy that no trading in derivatives for speculative purposes will be undertaken.

The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below:

i) Market Risk

Market risk is the risk that the fairvalue or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk currency rate risk interest rate risk and other price risks, such as equity price risk and commodity risk. Foreign currency risk is the risk that the fairvalue or future cashflows of a financial instrument will fluctuate because of changes in foreign exchange rates Interest. Interest rate risk is the risk that the fairvalue or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. This is based on the financial assets and financial liabilities held as at 31st March,2018and31st March,2017.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the Company’s position with regards to interest expenses to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of fixed rate and floating rate financial instruments in its total loan portfolio.

Interest rate sensitivity

The following table demonstrates the sensitivity to a reasonably possible change in interest rates on the unhedged portion of loans and borrowings. With all other variables held constant the Company’s profit before tax is affected through the impact on floating rate borrowings, as follows:

Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company’s exposure to the risk of changes in foreign exchange rates related primarily to the Company’s operating and financing activities.

ii) Credit risk

Credit risk is the risk that a counter party will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily trade receivables and advances to suppliers) and from its financing activities, including deposits and otherfinancial instruments.

Trade receivables

Customer credit risk is managed by the Company’s established policy, procedures and control relating to customer credit risk management. Outstanding customer receivables are regularly monitored. An impairment analysis is performed at each reporting date on an individual basis for major clients. An impairment analysis is performed at each quarter end on an individual basis for major customers.

iii) Liquidity Risk

The Company monitors its risk of a shortage of funds using a liquidity planning tool. The Company’s objective is to maintain a balance between continuity of funding and flexibility through the use of bank loans and cash credit facilities.

The table below summarises the maturity profile of the Company’s financial liabilities based on contracted undiscounted payments.

10. Information related to Consolidated Financial

The company is listed on stock exchange in India, the Company has prepared consolidated financial as required under IND AS 110, Sections 129 of CompaniesAct, 2013 and listing requirements. The consolidated financial statement is available on company’s website forpublicuse.

11. The Company has spent amount on corporate social responsibility expenses as below:

12. The Board of Directors have recommended for declaration of dividend at the Rate of 5% on equity shares (face value Rs. 10/- each) amounting to Rs. 1,095 Lakhs inclusive of Dividend Distribution Tax at their meeting held on 28th May, 2018 and to be approved at the Annual General Meeting.

13. Previous year’s figures have been regrouped / re-classified wherever necessary to make them more comparable.


Mar 31, 2017

1. Segment information

The Company has only one operating segment i.e. ‘Iron & Steel Business’ and operations are mainly within India. Hence, it is the only reportable segment under IND AS 108 ‘Operating Segments’.

Since there is no fresh issue or Bonus issue and also the absence of any other type of Share Capital Outstanding at the end of the Year the Diluted EPS and Basic EPS are same.

2. Disclosure of Employee Benefit

In view of the mandatory applicability of the revised Accounting Standard on Employs Benefits (AS 15 Revised) to the Company, effective 1st January, 2007 the additional charges are paid and charged to the statement of Profit and Loss according to the provisions of AS-15 (revised) as under :

i) Employee Provident Fund, the Company has made good the shortfall of interest on fund Rs, NIL (Previous Year Rs, 39 Lakhs)

a) The investment details of Gratuity funds are as per the Scheme of Life Insurance Corporation of India (LIC).

b) The investment details of Superannuation funds are as per the Scheme of Life Insurance Corporation of India (LIC) under two plans. Eventhough these plans are still continuing, Company has stopped making contribution towards One plan i.e. Superannuation Scheme of Workers w.e.f. 01.04.1995 on payment of bonus in the year 1995 as per the terms and conditions of Rules framed at the time of subscribing to the designated policy of LIC. Company was liable as per terms and conditions of the Trust deed to pay contributions only till applicability of provisions of payment of Bonus Act.

The fair value of financial assets and liabilities are included at the amount at which the instrument could be exchanged in a current transaction between willing parties in an orderly market transaction, other than in a forced or liquidation sale.

The following methods and assumptions were used to estimate the fair values.

i) The fair values of derivatives are on MTM as per Bank

ii) Company has opted to fair value its Long term and Current investments through profit & loss

iii) Company has adopted effective rate of interest for calculating Interest. This has been calculated as the weighted average of effective interest rates calculated for each loan. In addition processing fees and transaction cost relating to each loan has also been considered for calculating effective interest rate.

Fair value hierarchy

Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).

3.B Information related to Consolidated Financial

The company is listed on stock exchange in India, the Company has prepared consolidated financial as required under IND AS 110, Sections 129 of Companies Act, 2013 and listing requirements. The consolidated financial statement is available on company’s web site for public use.

4. C Events occurring after the Balance Sheet Date

No adjusting or significant non adjusting events have occurred between the reporting date and date of authorization of financial statements

5. The Company do not have any unheeded foreign currency exposure as at the year end.

6. Subsequent events : There are no reportable events

7. Financial statements for the year ended March 31, 2016 were audited by M/s. Patel, Shah & Joshi, Chartered Accountants, Mumbai.

8. Previous year’s figures have been regrouped / re-classified wherever necessary to make them more comparable.

*The Company’s manufacturing activity at Bhandara has been granted the status of “Mega Project” by the Government of Maharastra and therefore is eligible for Industrial Promotion Subsidy (IPS) under Packaged Scheme of Incentive (PSI) 2007. The purpose of the scheme is for intensifying and accelerating the process of dispersal of industries to the less developed regions and promoting high tech industries in the developed areas of the state occupied with the object of generating mass employment opportunities. Entitlements under the scheme consists of the following :-(a) Electricity duty exemption for a period of 7 years from the date of commencement of commercial production from September 10, 2009 to September 9, 2015 (b) 100% exemption from payment of stamp duty (c) VAT and CST payable to the State Government (on sales made from Bhandara plant within a period of 7 years starting from September 10, 2009) IPS will be payable so as to restrict up to 75% of the eligible fixed capital investments made from September 13, 2007 to September 10, 2009. The eligible certificate issued allows maximum fixed capital investment of Rs, 35000 lakhs and restricts IPS to 75% of Rs, 35000 lakhs i.e. Rs, 26.250 lakhs

Note : All the Joint - Ventures mentioned above, except Daido D.M.S. India Pvt. Ltd., have yet to commence the business / operations


Mar 31, 2016

Note : Figures in brackets relate to the previous year.

1. Previous year figures have been rearranged or regrouped wherever necessary to conform to current year''s classification. The line items which are either not applicable or were NIL for both the years are omitted in presentation.

Membership in other Companies denotes other than Foreign Companies.

None of the Non-executive Directors have any material pecuniary relationship or transactions with the Company other than receiving Sitting Fees for the Board and its Committee Meetings and profit based Commission.

The Company ensures that all statutory, significant material information are placed before the Board or Committees of Directors for their noting, consideration, review and approval, if any, to enable them to discharge their responsibilities as trustees of the large family of stakeholders. During the financial year, all the information on matters mentioned in terms of Clause 49 of the Listing Agreement (till 30th November 2015) and Regulation 17(3), Regulation 27 Schedule - II Part - E of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (effective 1st December 2015) has been placed before the Board for their considerations and approval, if any. The Board periodically reviews compliance of all laws applicable to the Company.

Scheduling and selection of Agenda items for the Board Meetings :

All departments of the Company schedule their work and plans in advance, particularly with regard to matters requiring consideration at the Board or its Committee Meetings.

Post meeting follow-up mechanism

All important decisions taken at the Board or its Committee Meetings are promptly communicated to the concerned departments. Action Taken Report on decisions and minutes of previous meetings are placed at the succeeding meetings of the Board and its Committee for noting, ratification and approval, if any.

Code of Conduct for the Board of Directors and Senior Management :

The Code of Conduct has already been communicated to all the Board members and members of the senior management. The Code is also available on the Company’s website www.sunflagsteel.com. All the Board members and senior management personnel have confirmed compliance with the Code for the financial year ended 31st March, 2016. The Annual Report contains a declaration to this effect signed by Deputy Managing Director and Chairman, Audit Committee of the Company.

c) Woman Director :

As per the provisions of the Companies Act, 2013 read with the Clause 49 of the Listing Agreement (erstwhile), Mrs. Neelam Kothari (DIN : 06709241), a qualified Chartered Accountant and Cost Accountant from Mumbai, appointed and continued to be on the Board of the Company effective 29th September, 2014.


Mar 31, 2015

1. Corporate information

Sunflag Iron and Steel Company Limited was incorporated in 1984 and engaged in the business of manufacturing and sale of Special Steel Rolled products.

a) Terms / Voting Rights attached to the Equity Shares

The paid up capital of the Company consists of only equity shares of Rs. 10/- each. Every equity shareholder is entitled to one vote per share.

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion of the number of the Equity shares held by the Shareholders.

ii) Pursuant to resolution passed in Extra-ordinary Gerneral Meeting held on 5th August 2014, 10% Cummulative preference shares, have been reclassified into equity shares. Accordingly the Equity Share capital now stands at 2,050 Lacs shares of Rs. 10/- each.

iii) During the year the company issued 18,021,945 equity shares of Rs.10/- each fully paid at a premium to non-promoter investor by way preferencial allotment.

i) Term Loans from Banks are secured by a first mortgage of all the Company's immovable properties, situated at village Warthi, District Bhandara, both present and future ranking pari passu interse and a first charge by way of hypothecation of all the Company's movables subject to prior charges created in favour of Company's bankers on inventories, book debts and other movables for securing the borrowings for working capital requirement.

ii) Term loan of Rs. 40 Crores (outstanding Rs. 25 Crores) borrowed from State Bank of India and State Bank of Bikaner & Jaipur are further secured by Personal Guarantee of Shri Ravi Bhushan Bhardwaj, Vice Chairman & Managing Director.

iii) The Company has not defaulted in either repayment of principle or interest during the year.

@ The Unsecured loans comprising interest free loans given by Promotors. There is no stipulation as to the repayment hence there is no default in repayment during the period.

i) Working Capital Borrowings are secured by way of hypothecation of inventories and book debts and further secured by way of second charge ranking pari passu over the fixed assets situated at village Warthi, Dist. Bhadara, both present and future, subject to prior charges created by the Company in favour of banks for securing term loans. Working capital borrowings are further secured by the personal guarantee of Shri Ravi Bhushan Bhardwaj, Vice Chairman & Managing Director of the Company.

ii) The Company has not defaulted in either repayment of principle or interest during the year.

Pursuant to the Supreme Court Order dated 24th September, 2014, the Coal Block allocated to the company with other JV partners in the names of Khappa Coal Company Private Limited, Madanpur (North) Coal Company Private Limited, and CT Mining Private Limited, stands cancelled. Subsequent to the cancellation of previous allocation, the Government of India, Ministry of Law and Justice (Legislative Department) has promulgated "The Coal Mines (Special Provisions) Act, 2015" for implementing the order of Supreme Court and fixation of compensation etc to the prior allottees. But the process of re-allotment and crystallization of compensation amount in respect of the Company's mine, is pending at Nominated Authority, Ministry of Coal, Goverment of India. In view of aforesaid, the Company has not recognized any amount towards diminution in the value of the investments made in the JV companies.

For the year ended 31.03.2015 31.03.2014 (Rs. in Lacs)

2.1 Contingent liabilities and commitments (to the extent not provided for)

i) Contingent liabilities

a) Unexpired Letter of Credit 4,549 6,102

b) Guarantees issued by Company's Bankers on behalf of the Company 8,204 3,275

c) Bonds / Undertakings given by the Company under Duty Exemption 2,598 2,598 Scheme to the Custom Authorities

d) Bills Discounted 6,935 7,170

e) Excise Duty & Custom Duty against which Company has preferred 65 65 an Appeal

f) Income Tax Liability - Disputed but paid 1,325 1,538

g) Corporate Guarantee issued to Banks on behalf of Subsidiaries 400 400

ii) Commitments

Estimated amount of contracts remaining to be executed on capital account and not provided for :

_ Tangible Assets 497 882

2.2 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on the data available with the Company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2015 due for a period of more than 45 days, accordingly, no interest was paid / is payable in terms of the said Act during the year under review.

2.3 Segment information

The Company's business activity primarily falls within a single business segment i.e., Iron & Steel business, however, the Company also generate power from its Captive Plant, which is entirely consumed in Iron & Steel Manufacturing Unit and no sale to third party has been made. The details of such consumed units are shown below. Hence there are no additional disclosures to be made under Accounting Standard (AS) 17, other than those already provided in the financial statements.

2.4 Employee benefit plans

In view of the mandatory applicability of the revised Accounting Standard on Employee Benefits (AS 15 Revised) to the Company, effective 1st January 2007, the additional charges are paid and charged to the statement of Profit & Loss according to the provisions of AS-15 (Revised) as under :

- Employees Provident Fund, the company has made good the shortfall of interest on fund Rs.Nil' (previous year Rs. 9.00 Lacs)

a) The investment details of Gratuity funds are as per the Scheme of Life Insurance Corporation of India (LIC).

b) The investment details of Superannuation funds are as per the Scheme of Life Insurance Corporation of India (LIC) under two plans. Eventhough these plans are still continuing, Company has stopped making contribution towards One plan i.e., Superannuation Scheme of Workers w.e.f. 01.04.1995 on payment of bonus in the year 1995 as per the terms and conditions of Rules framed at the time of subscribing to the designated policy of LIC. Company was liable as per terms and conditions of the Trust deed to pay contributions only till applicability of provisions of payment of Bonus Act.

3. Previous year figures have been rearranged or regrouped wherever necessary to conform to current year's classification. The line items which are either not applicable or were NIL for both the years are omitted in presentation.


Mar 31, 2014

1. Corporate information

Sunflag Iron and Steel Company Limited was incorporated in 1984 and engaged in the business of manufacturing and sale of Special Steel Rolled products.

2. Contingent liabilities and commitments (to the extent not provided for)

(Rs.in Lacs)

For the year Ended Particulars 31.03.2014 31.03.2013

i. Contingent liabilities

a) Unexpired Letter of Credit 6,102 10,801

b) Guarantees issued by Company''s Bankers on behalf of the Company 3,275 2,692

c) Bonds / Undertakings given by the Company under Duty Exemption Scheme 2,598 2,598 to the Custom Authorities

d) Bills Discounted 7,170 6,400

e) Excise Duty & Custom Duty against which Company has preferred an Appeal 65 100

f) Income Tax Liability - Disputed but paid 1,538 1,074

g) Income Tax Liability - Disputed but not paid - 739

h) Corporate Guarantee issued to Banks on behalf of Subsidiaries 400 400

2.1 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on the data available with the Company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2014 due for a period of more than 45 days, accordingly, no interest was paid /is payable in terms of the said Act during the year under review.

2.2 Disclosure as per Clause 32 of the Listing Agreements with the Stock Exchanges

Loans and advances in the nature of loans given to subsidiaries, associates and others and investment in shares of the Company by such Companies.

2.3 Segment information

The Company''s business activity primarily falls within a single business segment i.e., Iron & Steel business, however, the Company also generate power from its Captive Plant, which is entirely consumed in Iron & Steel Manufacturing Unit and no sale to third party has been made. The details of such consumed units are shown below. Hence there are no additional disclosures to be made under Accounting Standard (AS) 17, other than those already provided in the financial statements.

2.4 Employee benefit plans

In view of the mandatory applicability of the revised Accounting Standard on Employee Benefits (AS 15 Revised) to the Company, effective 1st January 2007, the additional charges are paid and charged to the statement of Profit & Loss according to the provisions of AS-15 (Revised) as under :

- Employees Provident Fund, the company has made good the shortfall of interest on fund Rs. 9.00 lacs (previous yearRs. Nil)

3. During the year, the Company has received letters from Ministry of Coal, Government of India for de-allocation of coal blocks allotted to the Company along with other Joint Venture partners as below :

i) Khappa & Khappa Extension coal block in the state of Maharashtra. The Company has filed a writ petition with Nagpur Bench of Bombay High Court, praying for setting aside the said de-allocation. On such petition the Bombay High Court has passed interim orders restraining the Central Government from taking coercive steps till further orders.

ii) Choritand Taliya coking coal block in the state of Jharkhand. The Company appealed to High Court of Jharkhand at Ranchi, and received an interim order, directing the Minstry of Coal, Government of India, not to take any coercive steps against the Company till further order.

iii) Madanpur (North) Coal Block in the State of Chhattisgarh, allocated to the Company with seven other allocatees. The allocatees have incorporated a JVC viz. Madanpur (North) Coal Company Private Limited. The JVC has filed a petition in the Delhi High Court against the de-allocation of the Coal Block. The Honorable Delhi High Court issued an interim order directing the Ministry of Coal, Government of India to maintain status-quo till further order by the court.

Since the matter is now sub-judice before the respective Hon''ble High Courts, the Company has neither provided for any contingencies nor recognised any amount towards diminution in the value of the investments made in the Subsidiary / JVCs and accordingly, the financial statements have been prepared on going concern basis.

5. Previous years figures have been rearranged or regrouped wherever necessary to conform to current year''s classification. The line items which are either not applicable or were NIL for both the years are omitted in presentation.


Mar 31, 2013

1. Corporate information

Sunflag Iron and Steel Company Limited was incorporated in 1984 and engaged in the business of manufacturing and sale of Special Steel Rolled products.

2.1 Contingent liabilities and commitments (to the extent not provided for)

(Rs.in Lacs)

For the year Ended Particulars 31.03.2013 31.03.2012

i. Contingent liabilities

a) Unexpired Letter of Credit 10,801 6,740

b) Guarantees issued by Company''s Bankers on behalf of the Company 2,692 2,666

c) Bonds / Undertakings given by the Company under Duty Exemption Scheme 2,598 2,782 to the Custom Authorities

d) Bills Discounted 6,400 3,367

e) Excise Duty & Custom Duty against which Company has preferred an Appeal 100 100

f) Income Tax Liability - Disputed but paid 1,074 1,324

g) Income Tax Liability - Disputed but not paid 739 -

h) Corporate Guarantee issued to Banks on behalf of Subsidiaries 400 400

ii. Commitments

Estimated amount of contracts remaining to be executed on capital account 507 3,765 and not provided for :-

Tangible Assets

2.2 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on the data available with the Company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2013 due for a period of more than 45 days, accordingly, no interest was paid /is payable in terms of the said Act during the year under review.

2.3 Segment information

The Company''s business activity primarily falls within a single business segment i.e., Iron & Steel business, however, the Company also generate power from its Captive Plant, which is entirely consumed in Iron & Steel Manufacturing Unit and no sale to third party has been made. The details of such consumed units are shown below. Hence there are no additional disclosures to be made under Accounting Standard (AS) 17, other than those already provided in the financial statements.

3. Previous years figures have been rearranged or regrouped wherever necessary to conform to current year''s classification. The amounts have been reclassified as per Revised Schedule VI and line items which are either not applicable or were NIL for both the years are omitted in presentation.


Mar 31, 2012

1. Corporate information

Sunflag Iron and Steel Company Limited was incorporated in 1984 and engaged in the business of manufacturing and sale of Special Steel Rolled products.

2.1 Contingent liabilities and commitments (to the extent not provided for)

(Rs. in Lacs)

For the year Ended

Particulars 31.03.2012 31.03.2011

i. Contingent liabilities

a) Unexpired Letter of Credit 6,740 5,034

b) Guarantees issued by Company's Bankers on behalf of the Company 2,666 1,800

c) Bonds / Under Takings given by the Company under Duty Exemption Scheme 2,782 3,408 to the Custom Authorities

d) Bills Discounted 3,367 2,935

e) Excise Duty & Custom Duty against which Company has preferred an Appeal 100 103

f) Sales Tax Liability against which Company has preferred an Appeal - -

g) Income Tax Liability even though paid against which Company has preferred 1,324 364 an Appeal

h) Corporate Guarantee issued to Banks on behalf of Subsidiaries 400 400

ii. Commitments

Estimated amount of contracts remaining to be executed on capital account 3,765 11,913 and not provided for :- Tangible Assets

2.2 Disclosures required under Section 22 of the Micro, Small and Medium Enterprises Development Act, 2006

Based on the data available with the Company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2012 due for a period of more than 45 days, accordingly, no interest was paid / is payable in terms of the said Act during the year under review.

2.3 Segment information

The Company's business activity primarily falls within a single business segment i.e., Iron & Steel business, however, the Company also generate power from its Captive Plant, which is entirely consumed in Iron & Steel Manufacturing Unit and no sale to third party has been made. The details of such consumed units are shown below. Hence there are no additional disclosures to be made under Accounting Standard (AS) 17, other than those already provided in the financial statements.

2.4 Employee benefit plans

In view of the mandatory applicability of the revised Accounting Standard on Employee Benefits (AS 15 Revised) to the Company, effective 1st January 2007 the additional charges are paid and charged to statement of Profit and Loss according to the provisions of AS 15 (Revised) as under :

- Employee Provident Fund, the Company has made good the shortfall of interest on fund Rs. Nil (Previous Year Rs. 0.51 lacs)

3. Previous years figures have been rearranged or regrouped wherever necessary to conform to current year's classification. The amounts have been reclassified as per Revised Schedule VI and line items which are either not applicable or are NIL for both the years are omitted in presentation.


Mar 31, 2011

1. Estimated amount of contracts remaining to be executed on Capital Account and not provided for are Rs. 11,913 Lacs (Previous year Rs. 9,756 Lacs).

2. Contingent Liabilities not provided for:

Rs. in Lacs

Sr. Particulars As at As at No. 31.03.2011 31.03.2010

i. Unexpired Letters of Credit 5,034 10,850

ii. Guarantees issued by Company's Bankers on behalf of the Company 1,800 1,161

iii. Bonds / Undertakings given by the Company under Duty Exemption 3,408 36 Scheme to Customs Authorities

iv. Bills Discounted 2,935 3,994

v. Excise Duty & Customs Duty against which Company has preferred 103 400 an appeal

vi. Sales Tax liability against which Company has preferred an appeal Nil 2,803

vii. Corporate Guarantee issued to Banks on behalf of Subsidiaries 400 400

viii.Income Tax Liability even though paid against which Company has 364 Nil preferred an appeal

3. PAYMENTS DUE TO SMALL AND MEDIUM ENTERPRISES (SME)

The Company is in the process of compiling information from its suppliers in respect of their registration under the Micro, Small and Medium Enterprises Development Act, 2006. However, based on the information available with the company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2011 due for a period of more than 45 days. Further, no interest during the year under review was paid / is payable in terms of the said Act.

4. The Company has Rs. 71 Lacs (Previous year Rs. 75 Lacs) of Export benefits under Scheme of DEPB in hand pending utilisation or sale.

5. RELATED PARTY DISCLOSURE : (as identified by the Management)

Related Party Relationship

Sunflag Power Limited Sunflag Special Steels Limited Subsidiary Companies Khappa Coal Company Private Limited

Haryana Television Limited Associate Enterprise Sunflag Limited, Channel Islands, Enterprise which have UK significant influence

Mr. P. B. Bhardwaj Mr. Ravi Bhardwaj Mr. Pranav Bhardwaj Key Managerial Personnel (KMP) Mr. Surendra Kumar Gupta

Ridge Farm Developers Private Relative to Key Managerial Limited Personnel

Madanpur (North) Coal Company Private Limited C T Mining Private Limited Joint Venture Companies Gujarat State Mining & Resources Corporation Limited

6. SEGMENT INFORMATION

The Company's business activity primarily falls within a single business segment i.e., Iron & Steel business, however, the Company also generate power from its Captive Plant, which is entirely consumed in Iron & Steel Manufacturing Unit and no sale to third party has been made. The details of such consumed units are shown below. Hence there are no additional disclosures to be made under Accounting Standard (AS) 17, other than those already provided in the financial statements.

7. DISCLOSURE OF EMPLOYEE BENEFIT AS PER ACCOUNTING STANDARD 15 (REVISED)

In view of the mandatory applicability of the revised Accounting Standard on Employee Benefits (AS 15 Revised) to the Company effective 1st January 2007, the additional charges are paid and charged to Profit and Loss Account according to the provisions of AS 15 (Revised) as under :

- Employee Provident Fund, the Company has made good the shortfall of interest on fund Rs. 51 Lacs (Previous year Rs. 6 Lacs)

a. The investment details of Gratuity funds are as per the Scheme of Life Insurance Corporation of India (LIC).

b. The investment details of Superannuation funds are as per the Scheme of Life Insurance Corporation of India (LIC) under two plans. Even though these plans are still continuing, Company has stopped making contribution towards One plan i.e., Superannuation Scheme of Workers w.e.f. 01.04.1995 on payment of bonus in the year 1995 as per the terms and conditions of Rules framed at the time of subscribing to the designated policy of LIC. Company was liable as per terms and conditions of the Trust deed to pay contributions only till applicability of provisions of payment of Bonus Act.

8. Previous year's figures have been regrouped / re-classified wherever necessary to make them more comparable.


Mar 31, 2010

1. Estimated amount of contracts remaining to be executed on Capital Account and not provided for are Rs. 975,601,430 (Previous year Rs. 441,270,445).

2. Interest free deferred Sales Tax liability has been accounted for at its actual value i.e. Rs. 1,307,478,592 (Previous year Rs. 1,201,211,258) (Refer point no. 12-Part A). Accordingly an additional amount of Rs. 95,032,499 is charged to Profit and Loss Account.

3. The Company has revised the estimated useful life of Plant & Machinery and related building (as stated in Point no. 2 - Part A of Accounting Policy). The depreciation charged to the Profit and Loss account based on the revised estimated useful life of these assets is Rs. 3,788.35 Lacs. In view of this change an additional amount of Rs. 61,528,729 is charged to Profit and Loss Account.

4. Contingent Liabilities not provided for:

(Rs. In 000)

Sr. As at As at

Particulars No. 31.03.2010 31.03.2009

i. Unexpired Letters of Credit 1,084,962 263,013

ii. Guarantees issued by Companys Bankers on behalf of the Company 116,126 151,505

iii. Bonds/Undertakings given by the Company under Duty Exemption 3,622 3,622 Scheme to Customs Authorities

iv. Bills Discounted 399,355 203,950

v. Excise Duty & Customs Duty against which Company has preferred 39,963 38,134 perferred an appeal

vi. Sales Tax liability against which Company has preferred an appeal 280,336 1,959

vii. Corporate Guarantee issued to Banks on behalf of Subsidiaries 40,000 -

5. PAYMENTS DUE TO SMALL AND MEDIUM ENTERPRISES (SME)

The Company is in the process of compiling information from its suppliers in respect of their registration under the Micro, Small and Medium Enterprises Development Act, 2006. However, based on the information available with the company, there were no dues to Micro, Small and Medium Enterprises as on 31st March 2010 due for a period of more than 45 days. Further, no interest during the year under review was paid / is payable in terms of the said Act.

6. The Company has Rs. 7,548,103 (Previous year Rs. Nil) of Export benefits under Scheme of DEPB in hand pending utilisation or sale.

7. DISCLOSURE OF EMPLOYEE BENEFIT AS PER ACCOUNTING STANDARD 15 (REVISED)

In view of the mandatory applicability of the revised Accounting Standard on Employee Benefits (AS 15 Revised) to the Company effective 1st January 2007, the additional charges are paid and charged to Profit and Loss Account according to the provisions of AS 15 (Revised) as under :

- Employee Provident Fund, the Company has made good the shortfall of interest on fund Rs. 644,034. (Previous year Rs. 791,574)

Significant Accounting Policies and Notes forming part of the Accounts for the year ended 31st March 2010

a. The investment details of Gratuity funds are as per the Scheme of Life Insurance Corporation of India (LIC).

b. The investment details of Superannuation funds are as per the Scheme of Life Insurance Corporation of India (LIC) under two plans. Even though these plans are still continuing, Company has stopped making contribution towards One plan i.e., Superannuation Scheme of Workers w.e.f. 01.04.1995 on payment of bonus in the year 1995 as per the terms and conditions of Rules framed at the time of subscribing to the designated policy of LIC. Company was liable as per terms and conditions of the Trust deed to pay contributions only till applicability of provisions of payment of Bonus Act.

8. SUBSIDIARY

Coal Block at Khappa in the State of Maharashtra has been allotted to Joint Venture Company, viz. M/s. Khappa Coal Company Private Limited. The Joint Venture partners are Sunflag Iron and Steel Company Limited and Dalmia Cement (Bharat) Limited where Sunflag Iron and Steel Company Limited is holding a share of 63.27%.

9. Pervious years figures have been regrouped / re-classified wherever necessary to make them more comparable.

Get Instant News Updates
Enable
x
Notification Settings X
Time Settings
Done
Clear Notification X
Do you want to clear all the notifications from your inbox?
Settings X