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Notes to Accounts of Tejassvi Aaharam Ltd.

Mar 31, 2014

Note No. 1

Terms / Rights attached to Equity Shares:

The Company has only one class of Equity Shares having a par value of Rs.10 per share. Each holder of Equity Shares is entitled to one Vote per share. The Dividend is subject to the aprpoval of the share holdes in the ensuing Annual General Meeting.

Note No. 2

Foreign Exchange Transactions: During the year the Company has not dealt with foreign exchange transactions.

Note No. 3

As the networth of the company has been eroded Reference as per provisions of Sick Industrial Com panles (Special Provisions) Act, 1985 (1 of 1986) was made to the Hon''ble BIFR on 28.05.2001 and the Company was declared as Sick Industrial Company by the Hon''ble BIFR on 06.05.2003. The BIFR has appointed M/s Punjab National Bank as Operating Agency to prepare rehabilitation scheme. The dues payable to Punjab National Bank were settled during 2007 under OTS Scheme and that of TIIC In 2011

While the Company is pursuing steps to settle alt dues, due to action under SARFAES Act by TIIC & the BIFR by its order dated 22.04.2010 abated the proceedings-of Sick Industrial Company. The appeal by the company against above order before AAIFR has been disallowed; The High Court has also declined to quash the order of BIFR. The company has also settled dues of SIPCOT, IFST and all other creditors.

SETTLEMENT OF DUES:

The Company has settled, under One Time Settlement (OTS), dues of Punjab National Bank, TIIC, SIPCOT, IFST and all remaining creditors. For this purpose, company has borrowed from its Associate Company M/s. Savorit Limited and its Managing Director. The Company. has paid Rs.241.02 Lakhs towards interest on the above loans

GUARANTEE IN FAVOUR OF ASSOCIATE COMPANY:

M/s Savorit Limited has borrowed from M/s Indian Bank, MGT Branch, Chennai and inturn advanced the amount (balance as on 31.03.2014 Rs. 1047.56 lakhs) to our Company. For this purpose our Company has given its Land and Building as Security and further extended Corporate Guarantee.

Note No. 4

In the opinion of the Board the Current Assets, such as Short Term Loans and Advances are shown at realisable value.

Note No. 5

Previous byear''s Figure have been regrouped reclassified wherever necessary to correspond with the current Year''s figure.


Mar 31, 2013

Note No. 1

Foreign Exchange Transactions:

During the year the Company has not dealt with foreign exchange transactions.

Note No. 2

As the networth of the company has been eroded, a reference as per provisions of Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986) was made to the Hon''ble BIFR on 28.05.2001 and the Company was declared as Sick Industrial Company by the Hon''ble BIFR on 06.05.2003. The BIFR has appointed M/s Punjab National Bank as Operating Agency to prepare rehabilitation scheme. The dues payable to Punjab National Bank were settled during 2007 under OTS Scheme and that of TIIC in 2011.

While the Company is pursuing steps to settle all dues, due to action under SARFAESI Act by TIIC & SIPCOT, the BIFR by Its order dated 22.04.2010 abated the proceedings-of Sick Industrial Company. The appeal by the company against above order before AAIFR has been disallowed. The High Court has also declined to quash the order of BIFR but liberty is granted to approach the AAIFR by way of appropriate application stating subsequent developments. The company has also settled dues of SIPCOT, IFST and all other creditors. SETTLEMENT OF DUES:

The Company has settled, under One Time Settlement (OTS), dues of Punjab National Bank & TIIC in earlier years and this year dues of SIPCOT, IFST and all remaining creditors have been settled. For this purpose, company has borrowed from its holding company M/s. SAVORIT LTD., and its Managing Director.

WAIVER OF INTEREST AND OTHER INCOME:

During the year, the company has settled SIPCOT dues and has received no dues certificate dated 22.5.2012. This settlement has resulted in waiver of interest to, the extent of 21.52 Crores out of total interest of Rs.25.86 provided so far. This amount of Rs.21.52 CTores has been credited to Statement"of Profit and Loss under other income.

Note No. 3

PROVISION FOR TAXATION:

Solely due to interest of Rs. 21.52 Crores on SIPCOT Loan settlement. In the opinion of Company, this is not a regular profit attracting provisions of Income Tax as well as Section 115 J B. Moreover interest charged in earlier has been continuously disallowed under 43B of I.T. Act, as it is mere provision and not actually paid. Also the Company is declared as Sick Industrial Company by BIFR on 6.5.2003, which though abated subsequently, the Company is hopeful of its restoration of BIFR status. Considering all the facts the Company is hopeful that the same is to be execluded U/S. 115 JB of IT. Act, and there may not be any tax liability hence no provision has been made.

Note No. 4

DISPOSAL OF PLANT AND MACHINERY

The company has stopped all operation in the Plant since October 2007. The Company sees no viability in running Spinning Mill. Also the company incurring power and over heads. Hence, in order to save costs the company has dismantled the Plant and Machinery and sold the same and the Profit on sale of Rs.7.28 Lakhs included in other income.

Note No. 5

Some of the balances of Short Term Loans and Advances are subject to confirmation.

Note No. 6

In the opinion of the Board the Current Assets, Non-Current Assets, such as Long Term Loans and Advances, are shown at realisable value.

The Company has unabsorbed depreciation and carryforward losses under Income Tax Act, 1961 avail- able to be setoff against future taxable Income. In the absence of virtual certainty of sufficient future taxable Income to avail the said credit, deferred tax Assets are not recognised during the year.

Note No. 7

Previous Year''s Figure have been regrouped / reclassified wherever necessary to correspond with the current year''s figure.


Mar 31, 2012

I. Foreign Exchange Transactions:

During the year the Company has not dealt with foreign exchange transactions.

II. As the networth of the Company has been eroded, a reference as per provisions of Sick Industrial Companies (Special provisions) Act, 1985(1 of 1986) was made to the Hon'nble BIFR on 28.05.2001 and the company was declared as Sick Industrial Company by the Hon'ble BIFR on 06.05.2003. Consequent on the Power Supply disconnection by TNEB on 03.11.2007 the Mill is not functioning.

III. In the absence of taxable income, no provision for Income Tax has been made.

IV. Some of the balances of Short Term Loans and Advances and Trade Payables are subject to confirmation.

V. In the opinion of the Board the Current Assets, Non-Current Assets, such as Long Term Loans and Advances, Inventory are shown at realisable value.

IV. Expenditure in Foreign Currency

VII. SECURED LOANS:

Term Loan from M/s SIPCOT is secured by mortgage of Fixed Assets present and future of the Company on paripassu basis and floating charge on Current Assets. They are also guaranteed by the Chairman-cum- Managing Director.

The Status of Loan is as follows;

a) Term Loan with M/s SIPCOT

The Company has paid Rupees Two Crores and Four lakhs as upfront payment and pursuing with M/s State Industries Promotion Corporation of Tamilnadu Limited for OTS.

VIII. The revised schedule VI notified under Companies Act, 1956 has become applicable to the company. The Company has reclassified previous year figures to confirm to this year classification.


Mar 31, 2010

1. Secured Loans:

Term loans from (a) M/s.TIIC & (b) M/s.SIPCOT- They are secured by mortgage of fixed assets present and future of the Company on paripassu basis and floating charge on current assets. They are also guaranteed by the Chairman-Cum-Managing Director.

The Status of Loans are as follows.

a) Term Loan with M/s.THC:

The Company has entered into OTS on 23.03.2007 for payment of Rs.270 lacs. The company paid Rs.54 lacs and could not pay the balance OTS amount. During the year, interest of Rs.25.92 lacs has been provided on OTS amount. Meanwhile M/s. TIIC has taken pocession of mill on 10.02.2010 under SARFAESI Act. The Company is renegotiating for revival of OTS Scheme and to take back pocession of the mill.

b) Term Loan with M/s.SIPCOT:

The Company is yet to arrive at OTS with M/s.SIPCOT. Amount of interest has been provided on accumulated Principal of Rs.300 lacs and funded interest.

2. Contingent Liabilities not provided for

P.F. Due: The Provident Fund Authorities vide their letter dt. 12.02.98 have intimated that the provisions of the Provident fund Act are applicable to the Company with effect from 22.09.97.But the Company has disputed the same in Madras High Court. As a matter of caution the Company has made a provision of Rs 2.95 Lakhs towards P.F. Payable, in earlier years. However, with effect from 5th July 1999, the Company has complied with the provisions of the said Act.

3. The company has won the case with TNEB and got refund of deposit made by the company against Tariff Concession and also interest on the same. An amount of Rs 29.08 lakhs of interest received is included in other income.

4. As the net worth of the Company has been eroded, a reference as per provisons of Sick Industrial Companies (Special Provisions) Act, 1985 (1 of 1986) was made to the HonbleBIFR on 28.05.2001 and the Company was declared as Sick Industrial Company by the Honble BIFR on 06.05.03. Consequent on the Power Supply disconnection by TNEB on 03.11.2007 the mill is not functioning.

5. In the absence of taxable income, no provision for income tax has been made.

6. Some of the balances of Sundry Creditors and Other Advances are subject to confirmation.

7. In the opinion of the Board the Current Assets, such as Stock-in-Trade, Sundry Debtors & Loans and advances are shown at realisable value.

8. As information relating to small scale units having business relationship with the Company is not readily available, such information is not furnished.

9. Raw Material Consumed Cotton

10. Previous Years Figures have been regrouped where ever necessary.

11(A)Related Parties:

Sl.No Party Relationship

1.1) Savorit Limited Associate Enterprise

2) Savorit Food Industries Limited -do-

3) Savorit Oils Limited -do-

II. a) Sri K.S. Venugopala, Chairman cum Managing Director Key managerial personal

b) Sri R. Vijaykumar, Director -do-

c) Sri K.Alagiriswami, Director -do-

12. The company has unabsorbed Depreciation and carryforward Losses under Income Tax Act, 1961 available to setoff against future taxable income. In the absence of virtual certainty of sufficient future taxable income to avail the said credit.deferred tax Assets are not recognised during the year.

 
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