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Notes to Accounts of Sunteck Realty Ltd.

Mar 31, 2015

1. Terms/rights attached to Equity shares

"The Company has only one class of equity share having value of Rs. 2 each with an entitlement of one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors are subject to the approval of the shareholders in the ensuing annual general meeting. In the event of liquidation of the Company, the holder of equity shares will be entitled to receive any of the remaining assets of the Company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders. "

2. Shares held by Subsidiaries

3,000,000 (Previous Year 3,000,000) equity shares out of issued, subscribed and paid up share capital are held by subsidiary Companies.

The Company uses the intrinsic value-based method of accounting for the compensation cost of stock options. Intrinsic value is the amount by which the quoted market price of the underlying shares as on date of the grant exceeds the exercise price of the option. Had the compensation cost of stock options been determined in the manner consistent with the fair value approach based on Black and Scholes model, the Company's net profit would be lower by Rs. 16,101,908, (Previous Year: lower by Rs. 9,764,198) and Basic/Diluted earning per share would be Rs. 11.61 (Previous year : Rs. 21.66) as against reported Basic / Diluted earning per shares of Rs. 11.86 (Previous year 21.81)

3.Terms and Conditions for Secured Loan

From a Bank - ICICI bank Limited

a) The term loan is secured by way of mortgage of land situated at borivali (realty project - signia high) and andheri (realty project - sunteck grandeur) and receivables thereon.

b) The term loan is further secured by way of lien on fixed deposits with bank of Rs. Nil; (Previous Year Rs. 23,484,464).

c) The interest rate on above term loan was I-base rate plus 4.5% spread.

d) Repayment schedule of secured term loan (refer note below)

From Others - LIC Housing Finance Limited

a) The term loan is secured by way of mortgage of land situated at borivali (realty project - signia high) and receivables thereon.

b) The interest rate on above term loan is LHPLR less 1.5% spread. Current LHPLR is 15.5%

c) Repayment schedule of secured term loan (refer note below)

4. Contingent liabilities and commitments

a) Contingent Liabilities (to the extent not provided for)

Income Tax Matters 6,207,795 6,207,795

Guarantee given on behalf of a step down subsidiary by way of Standby letter of Credit 1,549,122,300 -

Total 1,555,330,095 6,207,795

b) The Company's pending litigations comprise of claims against the Company and proceedings pending with tax and other authorities. The Company has reviewed all its pending litigations and proceedings and disclosed the contingent liabilities, wherever applicable in its financial statements. The Company does not reasonably expect the outcome of these proceedings to have a material impact on its financial statements.

5. Related Party Disclosures

1 Name of the Related Parties :

(i) Related parties where control exists, irrespective of whether transaction has occurred or not: a Subsidiary Companies/ LLP :

Amenity Software Private Limited

Magenta Computer Software Private Limited

Satguru Infocorp Services Private Limited

Starlight Systems Private Limited

Sunteck Property Holdings Private Limited

Sunteck Realty Holdings Private Limited

Skystar Buildcon Private Limited

Sahrish Construction Private Limited

Sunteck Fashion & Lifestyle Private Limited

Advaith Infraprojects Private Limited (From 01st October, 2014)

Starteck Lifestyle Private Limited (From 01st October, 2014)

Satguru Corporate Services Private Limited (Step down Subsidiary From 01st October, 2014) Sunteck Lifestyle International Private Limited (Foreign Subsidiary)

Sunteck Lifestyles Limited (Foreign & Step down Subsidiary)

Sunteck Lifestyles Management JLT (Foreign & Step down Subsidiary from 20th March, 2014)

Starlight Systems (I) LLP

Mithra Buildcon LLP (From 08th August, 2014)

(ii) Related Parties with whom transactions have taken place during the year a Joint Ventures :

Piramal Sunteck Realty Private Limited Uniworth Realty LLP Nariman Infrastructure LLP Pathway Buildcon LLP Assable Buildcon LLP Kanaka & Associates (Partnership Firm) b Other Associates:

Topzone Mercantile Company LLP c Key Management Personnel:

Mr. Kamal Khetan - Chairman & Managing Director Mr. Jignesh Sanghavi - Executive Director Mrs. Rachana Hingarajia - Company Secretary

Note : Related party relationship is as identified by the management and relied upon by the Auditors.

6. Pursuant to enachment of Companies Act, 2013 ( the Act), the Company has, effective 1st April, 2014, reviewed andrevised the useful life of certain tangible fixed assets, in accordance with Schedule II of the Act. Accordingly, the Company has given impact of Rs.455,862 on account of assets whise useful life already exhausted on 1st April,2014 to Retained Earnings. Further, in case of assets acquired prior to 1st April,2014, the carrying value of assets is depreciated over the remaining useful life determined by the Schedule II of the Act. Consequently, depreciaion expenses for the year are higher by Rs.2,878,224/-.

7. As the company is primarily engaged in only one business segment Viz. " Real Estate/ Real Estate Development and related activities" and substantial activities are carried out in India, there are no separate reportable segments as per Accounting Standard -17 " Segment Reporting".

8. The Company's normal operating cycle in respect of operations relating to under construction real estate projects may vary from project to project depending upon the size of the project, type of development, project complexities and related approvals. Operating cycle for all completed projects and other business is based on 12 months period. Assets and liabilities have been classified into current and non-current based on the operating cycle of respective businesses.

9. a. In the opinion of the management, all the assets other than fixed assets and non- current investments have a value on realisation in the ordinary course of business at least equal to the amount at which these are stated.

b. The accounts of certain trade receivables, trade payables, loans and advances and banks are, however, subject to formal confirmations or reconciliations and consequent adjustments, if any. However there is no indication of dispute on these accounts, other than those mentioned in the financial statements. The management does not expect any material difference affecting the current year's financial statements on such reconciliation/adjustments.

10. Undistributed accumulated profits amounting to Rs. 14,217,692 (included in current account balance in LLP) represents accumulated profit of the investee company, namely Starlight Systems (I) Private Limited which was converted into LLP on 22nd March,2013. the said accumulated profit can be distributed by the LLP after the end of 3 years for the date of conversion.

11. "Pursuant to the approval to the Scheme of Amalgamation/Arrangement (the 'Scheme') by the Hon'ble Bombay High Court vide its Order dated 19th December, 2014, all assets and liabilities of erstwhile Sanchit Derivatives Private Limited, (referred to as the "Transferor company" hereinafter), were transferred to and vested in the Company (referred to as the "Transferee company" hereinafter) from 15th January, 2014, the appointed date. The Scheme became effective on 14th February, 2015 upon filing of court order with the Registrar of Companies, Maharashtra. Accordingly, the effect of the Scheme has been given in this financial statements.

The amalgamation has been accounted for under the Purchase method as specified by the Accounting Standard AS - 14 "Accounting for Amalgamations" prescribed under section 133 of the Companies Act, 2013 ('the Act') read with Rule 7 of the Companies (Accounts) Rules, 2014. As on the appointed date, the Transferor company was holding 8,863,845 equity shares of face value of Rs. 2 each of the Transferee company as Investment, which has been cancelled pursuant to the scheme. 8,863,845 equity shares of face value of Rs. 2 each of the Transferee company has been issued to shareholders of Transferor company towards purchase consideration. The difference between excess of the net assets value of the Transferor Company transferred & recorded by the Transferee Company at their respective book values after cancellation of investments, over purchase consideration has been recorded as Capital reserve. "

12. Figures pertaining to Previous Year have been regrouped / reclassified wherever found necessary to conform to Current Year presentation.


Mar 31, 2014

(Amount in Rs.)

Particulars 31.03.14 31.03.13

1 Contingent liabilities and commitments

a) Contingent Liabilities (to the extent not provided for) Income Tax Matters 6,207,795 -

Total 6,207,795 -

2 Related Party Disclosures

1 Name of the Related Parties :

(i) Related parties where control exists, irrespective of whether transaction has occurred or not: a Subsidiary Companies:

Amenity Software Private Limited

Magenta Computer Software Private Limited

Satguru Infocorp Services Private Limited

Starlight Systems Private Limited

Sunteck Property Holdings Private Limited

Sunteck Realty Holdings Private Limited (From 25th April 2013)

Skystar Buildcon Private Limited

Sahrish Construction Private Limited

Eleanor Lifespaces Private Limited (formerly known as Signature Island

Buildcon Private Limited) (up to 31st December, 2013)

Sunteck Fashion & Lifestyle Private Limited (from 15th March 2014)

Sunteck Lifestyles International Private Limited (Foreign Subsidiary) (From 25th October 2013)

Sunteck Lifestyle Limited (Foreign Subsidiary) (From 6th November 2013)

Advaith Infraprojects Private Limited

Starlight Systems (I) LLP

(ii) Related Parties with whom transactions have taken place during the year a Joint Ventures :

Piramal Sunteck Realty Private Limited

V3 Designs LLP (upto 17th May 2013)

Uniworth Realty LLP

Nariman Infrastructure LLP

Pathway Buildcon LLP

Assable Buildcon LLP

Kanaka and Associates (Partnership Firm)

b Other Associates:

Topzone Mercantile Company LLP

c Key Management Personnel:

Mr. Kamal Khetan – Chairman & Managing Director Mr. Jignesh Sanghavi – Whole Time Director

Note : Related party relationship is as identified by the management and relied upon by the Auditors.

3 Exceptional item in the Previous Year, represents amount paid towards stamp duty and registration charges (crystalised during the Previous Year) on account of amalgamation of two Companies with the holding Company in the year 2008-09

4 The Company''s normal operating cycle in respect of operations relating to under construction real estate projects may vary from project to project depending upon the size of the project, type of development, project complexities and related approvals. Operating cycle for all completed projects and other business is based on 12 months period. Assets and liabilities have been classified into current and non-current based on the operating cycle of respective businesses.

5 a. In the opinion of the management, all the assets other than fixed assets and non- current investments have a value on realisation in the ordinary course of business at least equal to the amount at which these are stated.

b. The accounts of certain trade receivables, trade payables, loans and advances and banks are, however, subject to formal confirmations or reconciliations and consequent adjustments, if any. However there is no indication of dispute on these accounts, other than those mentioned in the financial statements. The management does not expect any material difference affecting the current year''s financial statements on such reconciliation/adjustments.

6 One of the investee company is being covered under the definition of "Subsidiary" as per section 2(87) of the Companies Act, 2013, therefore the same has been disclosed as subsidiary, even though the same is not a subsidiary company as per provisions of Accounting Standard 21 consolidated financial statements.

7 Share of profit from Limited Liability Partnership (LLP) represents accumulated profit of the investee Company, namely Starlight Systems (I) Private Limited which was converted in the LLP during the Previous Year. The carrying value of investment of Rs. 80,000 was in terms of the LLP agreement considered as fixed capital. The aforesaid accumulated profit included in ''current account balance in LLP'' can be distributed by the LLP after the end of 3 years from the date of conversion. i.e. 22nd March, 2013.

8 Figures pertaining to Previous Year have been regrouped / reclassified wherever found necessary to conform to Current Year presentation.


Mar 31, 2013

1 Lease

a. Initial direct cost such as Legal cost, Brokerage cost etc. are charged immediately to Statement of Profit and Loss.

c. Lease income recognized in Statement of Profit and Loss for the year ended 31st March, 2013 is Rs. 56,834,625/-(Previous Year Rs. 55,419,887).

2 Related Party Disclosures

1 Name of the Related Parties :

(i) Related Parties where control exists, irrespective of whether transcation has occured or not:

a Subsidiary Companies:

Amenity Software Private Limited

Magenta Computer Software Private Limited

Satguru Infocorp Services Private Limited

Starlight Systems Private Limited

Sunteck Property Holdings Private Limited

Skystar Buildcon Private Limited

Starlight Systems (I) Private Limited (up to 21st March, 2013)

Sahrish Construction Pvt. Ltd.(from 10th July, 2012)

Eleanor Lifespaces Pvt. Ltd. (formerly known as Signature Island Buildcon Pvt. Ltd.)

(ii) Related Parties with whom transactions have taken place during the year

a Joint Ventures :

Piramal Sunteck Realty Private Limited

Piramal Sunteck Realty Mauritius Limited (up to 14th September, 2012)

Piramal Sunteck International Limited (up to 14th September, 2012)

V3 Designs LLP

Uniworth Realty LLP

Nariman Infrastructure LLP

Pathway Buildcon LLP

Assable Buildcon LLP

Starlight Systems (I) LLP (from 22nd March, 2013)

b Partnership Firm:

Kanaka and Associates

c Other Associates:

Topzone Mercantile Company LLP

d Key Management Personnel:

Mr. Kamal Khetan – Chairman & Managing Director Mr. Jignesh Sanghavi – Whole Time Director

e Entity/Person/s having Significant Influence:

Starteck Infraprojects Private Limited

Note : Related party relationship is as identified by the management and relied upon by the Auditors.

3. Investments in Joint Ventures and the company''s share in their Assets & Liabilities, Income & Expenditure, Profit & Loss and Contingent Liability.

The interest of the Company in Joint ventures is listed below :

Piramal Sunteck Realty Private Limited (PSRPL) -50%

Piramal Sunteck Realty Mauritius Limited (PSRML) -50%

Piramal Sunteck International Limited (PSIL) -50%

Nariman Infrastructure LLP (NIL) -50%

Uniworth Realty LLP (URL)-50%

V3 Designs LLP (VDL) -50%

Assable Buildcon LLP (ABL) 50%

Pathway Buildcon LLP (PBL) 50%

Kanaka and Associates (Partnership Firm)50%

4 Exceptional item represents amount paid towards stamp duty and registration charges (crystalised during the year) on account of amalgamation of two companies with the company in the year 2008-09.

5 The Company''s normal operating cycle in respect of operations relating to under construction real estate projects may vary from project to project depending upon the size of the project, type of development, project complexities and related approvals. Operating cycle for all completed projects and other business is based on 12 months period. Assets and Liabilities have been classified into current and non-current based on the operating cycle of respective businesses.

6 a. In the opinion of the management, all the assets other than fixed assets and non- current investments have a value on realisation in the ordinary course of business atleast equal to the amount at which these are stated.

b. The accounts of certain Trade Receivables, Trade Payables, Loans and Advances and banks are, however, subject to formal confirmations or reconciliations and consequent adjustments, if any. However there is no indication of dispute on these accounts, other than those mentioned in the Financial Statements. The management does not expect any material difference affecting the current year’s financial statements on such reconciliation/adjustments.

7 Share of Profit from LLP represents accumulated profit of the investee company, namely starlight System (I) Pvt. Ltd. which was converted in the Limited Liability Partnership(LLP) during the year.The carrying value of investment of Rs. 80,000 has in terms of the LLP agreement considered as fixed capital.The aforesaid accumulated profit included in '' Current account balance in LLP'' can be distributed by the LLP after the end of 3 years from the date of conversion. i.e. 22nd March, 2013.

8 Previous year''s figures have been regrouped / rearranged wherever necessary to conform to current year''s classification.


Mar 31, 2010

1. Contingent Liabilities

In the opinion of the management, there is no contingent liability other than the stamp duty and registration charges which is payable as per High Court Order under section 394 of the Companies Act, 1956 in respect of amalgamation or reconstruction of companies, the amount of which is not quantifiable at present. Adequate provision has been made for all known liabilities, except interest and penalty as may arise.

2. In the opinion of the management, value on realization of fixed assets, current assets, loans and advances in the ordinary course of business will be at least equal to the amount at which they have been stated in the financial statements.

3. The balances of some of the loans and advances and creditors are subject to confirmation.

4. In the absence of necessary information with the Company, relating to the registration status of suppliers under the Micro, Small and Medium Enterprises Development Act, 2006, the information required under the said Act could not be complied and disclosed.

5. Related Party Disclosures

A) Names of Related Parties and Nature of Relationships

I. Subsidiary Companies

Amenity Software Private Limited Magenta Computer Software Private Limited Satguru Infocorp Services Private Limited Starlight Systems Private Limited Piramal Sunteck Realty Private Limited

II. Joint Venture

Kanaka & Associates (Partnership Firm)

III. Entity over which Company exercise significant influence

Eskay Infrastructure Development Private Limited Satguru Capital & Finance Private Limited Satguru Derivatives & Commodity Private Limited Buteo Finance & Investments Limited

IV. Key Management Personnel

Mr. KamalKhetan Mrs. Manisha Khetan

6. Previous years figures have been regrouped, rearranged, reclassified to the extent possible.

7. The Company operates in Single Segment i.e. Realty and Construction.

8. Other information pursuant to provision of Paragraph 3, 4A, 4C & 4D of Part II of Schedule VI of the Companies Act, 1956 are either Nil or Not Applicable.

 
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