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Notes to Accounts of Trinetra Cement Ltd.

Mar 31, 2015

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

These Financial Statements have been prepared in accordance with Generally Accepted Accounting Principles in India (‘Indian GAAP’) under the historical cost convention and on accrual basis. Exceptions to this basis, if any, are specifically mentioned. Indian GAAP comprises of Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and relevant provisions of the Companies Act, 2013 and the guidelines issued by the Institute of Chartered Accountants of India and the Securities and Exchange Board of India. Accounting policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

The Board of Directors has approved a Scheme of Amalgamation between Trinetra Cement Limited and Trishul Concrete Products Limited with The India Cements Limited effective 1st January 2014. Petitions have been filed in the Honorable High Court of Judicature at Madras under Section 391 to Section 394 of the Companies Act, 1956 for completing the procedural requirements for the said Scheme. The Shareholders of the respective Companies have approved the Scheme of Amalgamation. Pending sanction of the scheme, these Financial Statements have been prepared and submitted for adoption of Shareholders.

Rights, preferences and restrictions attached to shares

The Company has only one class of Equity Shares. Each Share has a paid up value of Rs.10/-. Every shareholder is entitled to one vote per share.

The Company declares and pays dividend in Indian Rupees at the discretion of Board of Directors, subject to availability of profits. The Dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting.

During the year 2012-13, the Company issued 90,00,000, 9% Non-Convertible Non-Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 05.11.2012, the date of allotment.

During the year 2011-12, the Company issued 60,500,000, 9% Non-Convertible Non-Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 06.02.2012, the date of allotment.

During the year 2010-11, the Company issued 1,000,000, 9% Non-Convertible Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 14.03.2011, the date of allotment.

SECURITY CLAUSE

Term Loans are secured in favour of Axis Trustee Services Limited, the Security Trustee for the Lender IndoStar Capital Finance Limited by hypothecation of Company's movable properties, both present and future, including current assets, movable machinery, machinery spares, tools and accessories, tangible and intangible assets of the Company, subject to prior charges on current assets created / to be created in favour of Company's bankers for securing the working capital facilities and further secured by a first pari passu charge on all the fixed assets of the Cement Plant and Thermal Power plant at Banswara, Rajasthan, pledge of shares held by Promoters and Corporate Guarantee from The India Cements Limited.

38. There are no dues to Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet date and there were no delays as per the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 in payment of dues to such enterprises. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company and has been relied upon by the auditors.

2. Deferred Taxation

In view of the losses incurred by the Company during last few years, the Company has accumulated net deferred tax assets of Rs.4659.25 lakhs as on 31.03.2015 (Rs.3688.29 lakhs as on 31.03.2014) in terms of provisions of Accounting Standard 22 "Accounting for Taxes on Income", issued by the Institute of Chartered Accountants of India. However, following prudent accounting policy and the guidelines contained in paragraphs 15 to 18 of the said Accounting Standard, the management has decided not to make the adjustment in the books of accounts for the value of the said deferred tax assets until such time that there is reasonable certainty of realisation of the said deferred tax assets against sufficient future taxable income.

3. Employee Benefits

The details of parameters adopted for valuation of post-employment benefit plans and leave benefits, as per Accounting Standard 15 issued by ICAI, are as under:

(a) Leave of absence and encashment:

The Company has different leave plans including paid leave of absence plans and encashment of leave plans for employees at different grades and provision has been made in accordance with Accounting Standard 15. The total amount of provision available for the unavailed leave balances as at 31st March 2015 is Rs.251.94 lakhs (31st March 2014 is Rs.322.48 lakhs).

(b) Gratuity:

The Company has made a provision for Gratuity for Rs.89.01 lakhs as per the acturial valuation.

(c) Contribution to Pension fund:

The Company offers pension plans for managerial grade employees. Employees are eligible for Defined Contribution Plan of Pension. The total amount contributed under Defined Contribution Plan is Rs.68.00 lakhs for year ended 31st March 2015 (year ended 31st March 2014: Rs.65.00 Lakhs).

4. Consequent to the dismissal of SLP by the Apex Court, the Company has recognized Rs.3.80 crores in Power & Fuel expenses towards its Renewable Energy obligations for purchase of 'minimum energy' from 'renewal sources' against consumption of power from captive generation and open access.

5. The Company had challenged the imposition of Entry Tax in the State of Rajasthan, which was decided against the Company by the Honorable High Court of Rajasthan. The Company decided, based on legal advice, to opt for the Amnesty Scheme announced by the Government of Rajasthan for payment of Entry Tax. Accordingly, the entire amount of Entry Tax for the financial years 2010-11 to 2014-15 is recognised during the current year. A sum of Rs.206 lakhs, being the amount of entry tax for the construction period of the project, is capitalised in the cost of fixed assets and sum of Rs.567 lakhs is recognised in the Profit & Loss A/c and included in the Rates & taxes.

6. Segment Results: The Company operates in single segment, i.e., Cement.

7. Previous year's figures have been regrouped wherever necessary.


Mar 31, 2014

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles (GAAP), includes generally under the historical cost convention on accrual basis and exceptions to this basis, if any, are herein specifically mentioned. GAAP comprises of mandatory Accounting Standards issued by the National Advisory Committee on Accounting Standards (NACAS) and The Institute of Chartered Accountants of India (ICAI), the provisions of the Companies Act, 1956 and the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

2. Rights, preferences and restrictions attached to shares

The Company has only one class of Equity Share. Each Share has a paid up value of Rs.10/-. Every shareholder is entitled to one vote per share.

The Company declares and pays dividend in Indian Rupees at the discretion of Board of Directors, subject to availability of profits. The Dividend proposed by the Board of Directors is subject to the approval of the shareholders at the Annual General Meeting.

During the year 2012-13, the Company issued 90,00,000, 9% Non-Convertible Non-Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 05.11.2012, the date of allotment.

During the year 2011-12, the Company issued 60,500,000, 9% Non-Convertible Non-Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 06.02.2012, the date of allotment.

During the year 2010-11, the Company issued 1,000,000, 9% Non-Convertible Cumulative Redeemable Preference Shares of Rs.100/- each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 14.03.2011, the date of allotment.

3. SECURITY CLAUSE

Term Loans are secured in favour of Axis Trustee Services Limited, the Security Trustee for the Lenders, namely Yes Bank Limited, UCO Bank, Axis Bank Limited and Infrastructure Development Finance Company Limited by hypothecation of Company''s movable properties, both present and future, including current assets, movable machinery, machinery spares, tools and accessories, tangible and intangible assets of the Company, subject to prior charges on current assets created / to be created in favour of Company''s bankers for securing the working capital facilities and further secured by a first pari passu charge on all the fixed assets of the Cement Plant at Banswara, Rajasthan, pledge of shares held by Promoters and Corporate Guarantee from The India Cements Limited.

4. There are no dues to Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet date and there were no delays as per the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 in payment of dues to such enterprises. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company and has been relied upon by the auditors.

5. Deferred Taxation

In view of the losses incurred by the Company during last few years, the Company has accumulated net deferred tax assets of Rs.3688.29 Lakhs as on 31.03.2014 (Rs.2278.30 Lakhs as on 31.03.2013) in terms of provisions of Accounting Standard 22 "Accounting for Taxes on Income", issued by the Institute of Chartered Accountants of India. However, following prudent accounting policy and the guidelines contained in paragraphs 15 to 18 of the said Accounting Standard, the management has decided not to make the adjustment in the books of accounts for the value of the said deferred tax assets until such time that there is reasonable certainty of realisation of the said deferred tax assets against sufficient future taxable income.

6. Employee Benefits

The details of parameters adopted for valuation of post-employment benefit plans and leave benefits, as per Accounting Standard 15 issued by ICAI, are as under:

(a) Leave of absence and encashment:

The Company has different leave plans including paid leave of absence plans and encashment of leave plans for employees at different grades and provision has been made in accordance with Accounting Standard 15. The total amount of provision available for the unavailed leave balances as at 31st March 2014 is Rs.322.48 Lakhs (31st March 2013 is Rs.232.05 Lakhs).

(b) Gratuity:

The Company has made a provision for Gratuity for Rs.50.72 Lakhs as per the acturial valuation.

(c) Contribution to Pension fund:

The Company offers pension plans for managerial grade employees. Employees are eligible for Defined Contribution Plan of Pension. The total amount contributed under Defined Contribution Plan is Rs.65.00 lakhs for year ended 31st March 2014 (year ended 31st March 2013: Rs.52.67 Lakhs).

7. Segment Results: The Company operates in single segment, i.e., Cement.

8. Previous year''s figures have been regrouped wherever necessary.


Mar 31, 2013

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles (GAAP), includes generally under the historical cost convention on accrual basis and exceptions to this basis, if any, are herein specifically mentioned. GAAP comprises of mandatory Accounting Standards issued by the National Advisory Committee on Accounting Standards (NACAS) and The Institute of Chartered Accountants of India (ICAI), the provisions of the Companies Act, 1956 and the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

During the year ended 31.03.2012, the revised Schedule VI notified under the Companies Act, 1956, has become applicable to the Company for preparation and presentation of its Financial Statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of Financial Statements. However, it has significant impact on presentation and disclosure made in the Financial Statements.

2. There are no dues to Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet date and there were no delays as per the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 in payment of dues to such enterprises. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company and has been relied upon by the Auditors.

3. Deferred Taxation

In view of the losses incurred by the Company during last few years, the Company has accumulated net deferred tax assets of Rs.2278.30 Lakhs as on 31.03.2013 (Rs.2036.57 lakhs as on 31.03.2012) in terms of provisions of Accounting Standard 22 "Accounting for Taxes on Income", issued by the Institute of Chartered Accountants of India. However, following prudent accounting policy and the guidelines contained in paragraphs 15 to 18 of the said Accounting Standard, the management has decided not to make the adjustment in the books of accounts for the value of the said deferred tax assets until such time that there is reasonable certainty of realisation of the said deferred tax assets against sufficient future taxable income.

4. Employee Benefits

The details of parameters adopted for valuation of post-employment benefit plans and leave benefits, as per Accounting Standard 15 issued by ICAI, are as under:

(a) Leave of absence and encashment:

The Company has different leave plans including paid leave of absence plans and encashment of leave plans for employees at different grades and provision has been made in accordance with Accounting Standard 15. The total amount of provision available for the unavailed leave balances as at 31st March 2013 is Rs.232.05 Lakhs (as at 31st March 2012: Rs.188.05 Lakhs).

(b) Gratuity:

The Company has made a provision for Gratuity for Rs.10.36 Lakhs as per the actuarial valuation.

(c) Contribution to Pension fund:

The Company offers pension plans for managerial grade employees. Employees are eligible for Defined Contribution Plan of Pension. The total amount contributed under Defined Contribution Plan is Rs. 52.67 lakhs for year ended 31st March 2013 (year ended 31st March 2012: Rs.44.53 Lakhs).

5. Segment Results: The Company operates in single segment, i.e., Cement.

6. Previous year''s figures have been regrouped wherever necessary.


Mar 31, 2012

1. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles (GAAP), includes generally under the historical cost convention on accrual basis and exceptions to this basis, if any, are herein specifically mentioned. GAAP comprises of mandatory Accounting Standards issued by the National Advisory Committee on Accounting Standards (NACAS) and The Institute of Chartered Accountants of India (ICAI), the provisions of the Indian Companies Act, 1956 and the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI). Accounting policies have been consistently adopted except where a change in existing GAAP requires a change in accounting policy hitherto in use.

During the year ended 31.03.2012, the revised Schedule VI notified under the Indian Companies Act, 1956, has become applicable to the Company for preparation and presentation of its Financial Statements. The adoption of revised Schedule VI does not impact recognition and measurement principles followed for preparation of Financial Statements. However, it has significant impact on presentation and disclosure made in the Financial Statements. The previous year's figures have also been reclassified accordingly.

Rights, preferences and restrictions attached to shares

The Company has only one class of Equity Shares. Each Share has a paid up value of Rs.10/-. Every shareholder is entitled to one vote per share.

The Company declares and pays dividend in Indian Rupees at the discretion of Board of Directors, subject to availability of profits. The Dividend proposed by the Board of Directors are subject to the approval of the shareholders at the Annual General Meeting.

During the year, the Company issued 60,500,000, 9% Non-Convertible Non-Cumulative Redeemable Preference Shares of Rs.100 each fully paid up. These Preference shares shall be redeemable at the end of six years commencing from 06.02.2012, the date of allotment.

During the year 2010-11, the Company issued 1,000,000, 9% Non-Convertible Cumulative Redeemable Preference Shares of Rs.100 each fully paid up. These Preference Shares shall be redeemable at the end of six years commencing from 14.03.2011, the date of allotment.

Term Loans are secured in favour of Axis Trustee Services Limited, the Security Trustee for the Lenders, namely Yes Bank Limited, UCO Bank, Axis Bank Limited and Infrastructure Development Finance Company Limited by hypothecation of Company's movable properties, both present and future, including current assets, movable machinery, machinery spares, tools and accessories, tangible and intangible assets of the Company, subject to prior charges on current assets created / to be created in favour of Company's bankers for securing the working capital facilities and further secured by a first pari passu charge on all the fixed assets of the Cement Plant at Banswara, Rajasthan, pledge of shares held by Promoters and Corporate Guarantee from The India Cements Limited.

The above secured long-term borrowings are repayable in 26 equal quarterly installments. The last installment falls due on 1st July, 2018.

2. There are no dues to Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet date and there were no delays as per the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 in payment of dues to such enterprises. The above information regarding Micro, Small and Medium Enterprises has been determined to the extent such parties have been identified on the basis of information available with the Company and has been relied upon by the Auditors.

3. Deferred Taxation

In view of the losses incurred by the Company during last few years, the Company has accumulated net deferred tax assets of Rs.2036.57 Lakhs as on 31.03.2012 (Rs.770.24 Lakhs as on 31.03.2011) in terms of provisions of Accounting Standard 22 "Accounting for Taxes on Income", issued by the Institute of Chartered Accountants of India. However, following prudent accounting policy and the guidelines contained in paragraphs 15 to 18 of the said Accounting Standard, the management has decided not to make the adjustment in the books of accounts for the value of the said deferred tax assets until such time that there is reasonable certainty of realisation of the said deferred tax assets against sufficient future taxable income.

4. Employee Benefits

The details of parameters adopted for valuation of post-employment benefit plans and leave benefits, as per Accounting Standard 15 issued by ICAI, are as under:

(a) Leave of absence and encashment:

The Company has different leave plans including paid leave of absence plans and encashment of leave plans for employees at different grades and provision has been made in accordance with Accounting Standard 15. The total amount of provision available for the unavailed leave balances as at 31st March 2012 is Rs.188.05 Lakhs (as at 31st March 2011: Rs.79.33 Lakhs).

(b) Gratuity:

The Company has made a provision for Gratuity for Rs.9.33 Lakhs as per the actuarial valuation.

5. The amount of Rs.14490.37 Lakhs is received by the Company as advance share application money from its ultimate holding company, The India Cements Limited. This amount is proposed to be utilized towards issue of equity/preference shares by the Company after complying with necessary formalities. On the balance sheet date the Company had unissued share capital of Rs.5550 Lakhs consisting of 555 Lakhs equity shares of face value of Rs.10/- each.

6. Segment Results: The Company operates in single segment, i.e., Cement.

7. Previous year's figures have been regrouped wherever necessary.


Mar 31, 2010

1. Contingent liabilities:

As at As at 31.03.2010 31.03.2009

(Rupees in Lacs)

a) Estimated amount of contracts (net of advances) remaining to be

executed on capital account and not provided for. 27394 21740

b) Interest for late payment of income-tax for which demand is raised

by the Government but company has applied for waiver of the same. 55 NIL

2. In view of the losses incurred by the Company during last few years, the Company has accumulated net deferred tax assets of Rs. 379 lacs as on 31.03.2010 (Rs.415 lacs as on 31.03.2009) in terms of provisions of Accounting Standard 22 "Accounting for Taxes on Income", issued by the Institute of Chartered Accountants of India. However, following prudent accounting policy and the guidelines contained in paragraphs 15 to 18 of the said Accounting Standard, the management has decided not to make the adjustment in the books of accounts for the value of the said deferred tax assets until such time that there is reasonable certainty of realisation of the said deferred tax assets against sufficient future taxable income.

3. The Company is setting up a new Cement plant at Banswara in Rajasthan. Pre-operative expenses incurred on this project are shown separately. These expenses shall be capitalised on completion of the project.

4. Related party disclosure in accordance with the Accounting Standard 18 issued by the Institute of Chartered Accountants of India.

5. Segment Results: The Company has discontinued operation in its Zinc division. The income shown for the year represents income from sale of inventories of Zinc division. Its cement project is still under implementation.

6. Classification of suppliers as Micro, Small or Medium Enterprises is done where such information is provided by the supplier. No interest is paid or payable during the year to Micro, Small or Medium Enterprises.

7. Balances of debtors, creditors and loans and advances are subject to confirmation. In the opinion of the management these accounts will fetch the amount as stated in the books of accounts on realisation in the ordinary course of business.

8. Expenses include prior period expenses (net) Rs. 69,286 (Previous year- Rs. 175,400).

9. Information pursuant to paragraph 3, 4C of Part II of Schedule VI to the Companies Act, 1956 :

(i) The company is setting up a new cement plant at Banswara in Rajasthan. The project is under execution at present. The company disposed off all plant and machinery of its zinc plant at Pithampur in Madhya Pradesh during the previous year. Consequently, the company does not have any manufacturing facility at present. No production activity was carried on during current or the previous year.

10. Previous years figures have been reclassified / regrouped wherever necessary.

 
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