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Notes to Accounts of TCM Ltd.

Mar 31, 2014

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

2013-14 2012-13 (i) Contingent Liabilities

(a) Claims against the company not acknowledged as debt

Disputed Provident Fund Damages and Interest 1,812,684.00 1,812,684.00

Disputed power charges demand from KSEB 7,500,000.00 7,500,000.00

Disputed ESI Dues 380,000.00 380,000.00

Disputed demand from Karnataka state 253,000.00 253,000.00 sales tax Dept

Disputed demand from Kerala state 7,800,000.00 19,636,000.00 sales tax Dept

Disputed Excise duty liability 1,802,599.00 1,802,599.00

(b) Guarantees

Guarantees Issued by Bankers on behalf 2,558,000.00 2,558,000.00 of the company

22,106,283.00 33,942,283.00

2. The difference aroused between the taxable income and accounting income is in permanent nature and will result in deferred tax asset, but there is no virtual certainty of taxable income in the near future of the Company. So the Company has not provided in the books of account the effect of deferred tax as per the norms and provisions of Accounting Standard — 22 " Taxes on Income" issued by the Institute of Chartered Accountants of India.

3. Regarding the Assessment Year 2004-05 the appeal filed by the Company before the Income Tax Appellate Tribunal has been partly allowed, but the order giving effect to this order has not yet been passed by the department. The Company intends to take up the matter before the Honorable High Court of Kerala.

4. Out of the total extent of land measuring 99.92 acres purchased at Ulundurpet, 54 acres of land come under Urban Land Ceiling Act. The application for exemption from Land ceiling is pending before the Government the clearance for the land admeasuring 99.92 Acres has not been granted by Pollution Control Board because of the stretch of land falling within one kilometer from the banks of the river. In the light of the land ceiling act, the possibilities for disposal of lands possess difficult. In absence of reasonable marketable value, the increase or decrease in the value of the land is not ascertainable.

5. The company reference application to BIFR as a sick industrial Company stands registered on case No.101/2005 dt.28.03.2005.BIFR has appointed Bank of Baroda, as the Operating Agency. The Company has submitted a revival proposal to the Bank Baroda.

6. The Maintenance expenditures of the closed units are charged to revenue.

7. Balances of debtors, creditors, loans and advances and banks/ financial institutions are subject to confirmation / reconciliation by the parties.

8. Company does not possess full information as to, which of its suppliers are small scales industrial undertakings holding permanent registration certificate issued by the relevant authorities.

9. The operations of the company relate only to one segment viz., manufacture and sale of chemicals

10. In the absent of realizable value of assets of the company, the decrease or increase in value of assets has not been quantified. Hence the impairment of assets has not been quantified. Hence the impairment of assets could not be ascertained

11. The balance under deposits made by the company with different authorities and various other parties were not confirmed as on 31st March 2014. The following are the details.


Mar 31, 2013

1. There is a reversal Deferred Tax during the year and the deferred tax liability has been reduced to the extent of liability as on 01-04-2012.Entire difference arise because of reversal of timing (Liability) difference of Rs.23,11,034/- But the company has not recognized deferred tax asset.

2. (a) The appeal petition filed in the Honorable Supreme Court of India regarding the disputed tax demand for the financial year 1995-96 and 1996-97 has been rejected by the Court because of time bar in filing the appeal. The actual demand was Rs.17.56 Lakhs and the same was paid before filing the appeal under the CIT (Appeal). But the demand comes to Rs. 1,17, 82,988/- as per the Income Tax dept. website as on 31-03-2013 including interest. The same was provided as provision for taxation as extraordinary item in the financial statement.

b) Regarding the Assessment Year 2004-05 the appeal filed by the Company before the Income Tax Appellate Tribunal has been partly allowed, but the order giving effect to this order has not yet been passed by the department. The Company intends to take up the matter before the Honorable High Court of Kerala.

3. Out of the total extent of land measuring 99.92 acres purchased at Ulundurpet, 54 acres of land come under Urban Land Ceiling Act. The application for exemption from Land ceiling is pending before the Government the clearance for the land admeasuring 99.92 Acres has not been granted by Pollution Control Board because of the stretch of land falling within one kilometer from the banks of the river. In the light of the land ceiling act, the possibilities for disposal of lands possess difficult. In absence of reasonable marketable value, the increase or decrease in the value of the land is not ascertainable.

4. The company reference application to BIFR as a sick industrial Company stands registered on case No.101/2005 dt.28.03.2005.BIFR has appointed Bank of Baroda, as the Operating Agency. The Company has submitted a revival proposal to the Bank Baroda.

5. The Maintenance expenditures of the closed units are charged to revenue.

6. Balances of debtors, creditors, loans and advances and banks/ financial institutions are subject to confirmation / reconciliation by the parties.

7. Company does not possess full information as to, which of its suppliers are small scales industrial undertakings holding permanent registration certificate issued by the relevant authorities.

8. The operations of the company relate only to one segment viz., manufacture and sale of chemicals

9. In the absent of realizable value of assets of the company, the decrease or increase in value of assets has not been quantified. Hence the impairment of assets has not been quantified. Hence the impairment of assets could not be ascertained

10. The balance under deposits made by the company with different authorities and various other parties were not confirmed as on 31st March 2013. The following are the details.


Mar 31, 2012

A) Where in respect of an issue of securities made for a specific purpose, the whole or part of the amount has not been used for the specific purpose at the balance sheet date, Indicate below how such unutilized amounts have been used or invested.

b) In the opinion of the Board, all assets other than fixed assets and non current investments, have a realisable value in the ordinary course of business which is not different from the amount at which it is stated, except as stated below:

1. There is a reversal Deferred Tax during the year and the deferred tax liability has been reduced to the effect as on 31.03.2012.Entire difference arise because of reversal of timing (Liability) difference of Rs.23, 94,175/-

2. (a) The income tax assessment have been completed up to the accounting year 2003- 2004. As between the financial period ended 31.03.1996 and 31.03.1997, there is a net demand of Rs.17.56 lakhs, which has already been paid .However, the disputed tax is disclosed as a Contingent Liability .The appeal filed by the Company in the Honourable High Court of Kerala has been dismissed. But the orders giving effect to the said Court Order has not yet been passed by the department. The Company is in the process of taking up the matter before the Honourable Supreme Court of India.

b) Regarding the Assessment Year 2004-05 the appeal filed by the Company before the Income Tax Appellate Tribunal has been partly allowed, but the order giving effect to this order has not yet been passed by the department. The Company intends to take up the matter before the Honourable High Court of Kerala.

3. Out of the total extent of land measuring 99.92 acres purchased at Ulundurpet, 54 acres of land come under Urban Land Ceiling Act. The application for exemption from Land ceiling is pending before the Government the clearance for the land admeasuring 99.92 Acres has not been granted by Pollution Control Board because of the stretch of land falling within one kilometer from the banks of the river. In the light of the land ceiling act, the possibilities for disposal of lands possess difficult. In absence of reasonable marketable value, the increase or decrease in the value of the land is not ascertainable.

4. The company reference application to BIFR as a sick industrial Company stands registered on case No.101/2005 dt.28.03.2005.BIFR has appointed Bank of Baroda, as the Operating Agency. The Company has submitted a revival proposal to the Bank Baroda.

5. The Maintenance expenditures of the closed units are charged to revenue.

6. Balances of debtors, creditors, loans and advances and banks/ financial institutions are subject to confirmation / reconciliation by the parties.

7. Company does not possess full information as to, which of its suppliers are small scales industrial undertakings holding permanent registration certificate issued by the relevant authorities.

8. The operations of the company relate only to one segment viz., manufacture and sale of chemicals

9. In the absent of realizable value of assets of the company, the decrease or increase in value of assets has not been quantified. Hence the impairment of assets has not been quantified. Hence the impairment of assets could not be ascertained


Mar 31, 2010

1. There is a reversal Deferred Tax during the year and the deferred tax liability has been reduced to the effect as on 31.03.2010.Entire difference arise because of reversal of timing (Liability) difference of Rs.26, 46,954/-

2. (a) The income tax assessment has been completed up to the accounting year 2003- 2004.

As between the financial period ended 31.03.1996 and 31.03.1997, there is a net demand of Rs. 17.56 lakhs .which has already been paid However ,the disputed tax is disclosed as a Contingent Liability .The appeal filed by the company before Income Tax Appellate Tribunal is decided against the Company and the Company is in the process of filing and appeal before the Honourable High Court of Kerala.

(b) In exercise of Revissionary Powers of the Commissioner of Income Tax under section 263 of the Income Tax Act, a re- assessment was made for the assessment year 1997-98 raising a demand of Rs.47.46 Lakhs. The company filed an appeal against the order of the assessing officer before the Commissioner of Income Tax(Appeals).The Commissioner (Appeals ) has made a demand of Rs.34.58Lakhs.The company filed an appeal against the order of Commissioner (Appeals) before Income Tax Appellate tribunal. The appeal Challenging the revissionary powers of the Commissioner of Income Tax under section 263 is also pending before the Honourble High Court of Kerala.

3. Out of the total extent of land measuring 99.92 acres purchased at Ulundurpet, 54 acres of land come under Urban Land Ceiling Act. The application for exemption from Land ceiling is pending before the Government, the clearance for the land admeasuring 99.92 Acres has not been granted by Pollution Control Board because of the stretch of land falling within one kilometer from the banks of the river. In the light of the land ceiling act, the possibilities for disposal of lands possess difficult. In absence of reasonable marketable value, the increase or decrease in the value of the land is not ascertainable.

4. The company reference application to BIFR as a sick industrial Company stands registered as case No.101/2005 dt.28.03.2005.BIFR has appointed Bank of Baroda, as the Operating Agency. The Company has submitted a revival proposal to the Bank of Baroda.

5. The Maintenance expenditures of the closed units are charged to revenue.

6. Balances of debtors, creditors, loans and advances and banks/ financial institutions are subject to confirmation / reconciliation by the parties.

7. Company does not possess full information as to, which of its suppliers are small scales industrial undertakings holding permanent registration certificate issued by the relevant authorities.

8. The operations of the company relate only to one segment viz., manufacture and sale of chemicals

9. In the absent of realizable value of assets of the company, the decrease or increase in value of assets has not been quantified. Hence the impairment of assets has not been quantified. Hence the impairment of assets could not be ascertained

10. Earning per Shares of the company are:-Basic EPS (-8.80) Diluted EPS (-8.80)

11. The balance under deposits made by the company with different authorities and various other parties were not confirmed as on 31st March 2010. The following are the details.

12. Contingent liabilities not provided for:

(Rs.in Lakhs) 31.03.2010 31.03.2009

a Guarantees issued by bankers on behalf of the 25.58 25.58

Company

b Disputed Income Tax Demand 52.14 52.14

c Disputed Power Charges demand from KSEB not 75.00 208.00

acknowledged as debt by the Company

d Disputed ESI Dues 3.80 Nil

e Disputed demand from Kamataka State Sales Tax Dept. 2.53 Nil

 
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