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Notes to Accounts of Triveni Glass Ltd.

Mar 31, 2015

1. Contingent liabilities and receivables :

i) Contingent liabilities:

(a) The Company received Show-cause cum Demand Notices in routine way regarding non-admissibility of Modvat credit due to technical defects in documentation. Most of the defects are curable and are allowed at the first or second stage of hearing. As on 31.03.2014, such show- cause cum demand notices proposing to disallow modvat credit stood at Rs. 111.00 lacs (2013- 14 Rs. 122.00 lacs).

(b) The Commissioner Central Excise reconfirmed demand of Rs 20.96 crores and imposed equal penalty thereon after adjudicating the case. He also imposed penalties on Directors and Senior Officers of the Company. We had filed appeal against the order along with the stay application for waiver or pre deposit before Central Excise Tribunal New Delhi who have allowed unconditional stay.

(c) Sales Tax Department has created a demand of Rs. 107.21 lacs (2014-Rs.107.21 lacs) disputing the rate of tax on Tinted Glass and other sales tax matters, which the Co. has not admitted and filed appeal against above mentioned demands, However, the Hon'ble Court has dismissed our appeal against which we have filed SLP before Hon'ble Supreme Court and the SLP has been admitted on 20.04.2011 for final hearing. Allahabad High Court has also disallowed our appeal against higher rate of tax on Tinted Glass for period subsequent to 1996 onwards and we filed SLP against the same before the Honorable Supreme Court to be tied up and to with earlier hearing applications.

(d) Modvat credit on capital goods availed during installation of Float Glass plant to the extent of Rs. 7.26 Crores was disallowed by Jurisdictional Deputy Commissioner and equal penalty was imposed by wrongly treating Float Glass as a separate and independent unit while the fact is otherwise. Float Glass Plant is an expansion of the then factory and the department itself has endorsed Float Glass Plant in our Central Excise License (Registration Certificate) as expansion. Against, the order of the Commissioner (Appeals), we have filed appeal before CESTAT, New Delhi, which has completely waived pre-deposit of 50% of the required amount. Now the case will be heard and decided on merits in due course.

(e) There are three (3) EPCG licenses wherein in case of the main license for input of 2nd hand figured glass though the export obligations have been completed by us but necessary documents have not been filled with DGFT Kanpur. Hence a liability of Rs 117 lacs plus interest Rs 288 lacs as on 31st of March 2015 is disputed. In case of another license the duty amount due is Rs 79 lacs plus interest Rs 165 lacs total Rs 244 lacs. In case of third license which is for frosting machine the liability is about R 10 lacs. In case of advance licenses the duty amount due is Rs 107 lacs and another Rs 260 lacs is due on account of interest and penalty. As our case is before BIFR hence we have requested in our debt restructuring proposal for waiver of interest and penalty amount. In case of the advance licenses, once our balance export made during the years 1995-2005 are accepted by DGFT Kanpur then there advance licenses will also get fulfilled there will not be any liability on this and therefore final liability is only on second and third EPCG license that is Rs 79 lacs which may arise.

(f) Recently the company has also filled appealed before Tribunal against order passed by appellate Commissioner Allahabad for Rs 788191/- and Rs 421831/- demanding duty on sound delivery charges against government supplies

(g) The company has since paid the full amount to the 56 workers under the arbitrator clause as ordered by the Supreme Court.

(h) Our request for remission on Duty of Finished goods has been rejected by the Assistant Commissioner, thus creating a demand of Rs 43237/- and equal penalty thereon. We have filed appeal against the said order.

(i) Being aggrieved with the order of Commissioner Appeals confirming demand of Rs 130372 and imposing equal penalty thereon for allegedly charging higher prices from deposit compared to expected prices . We have filed appeal before Central Excise Tribunal Delhi which has directed us to deposit of the balance amount till the case is finally decided The amount has been adjusted against the input credit available with us.

2. As per AS 15

Retirement benefits namely gratuity & earned leave liability for Rajahmundry employees has been duly provided in Allahabad books.

Segment Reporting as per Accounting Standard AS-17 issued by Institute of Chartered Accountants of India.

(i) Business Segments:

The Company has considered "Business Segment" as the Primary Segment for disclosures, which comprises of Flat Glass .

(ii) Geographical Segments:

Geographical Segment is the "Secondary Segment" and location of its market I.e. "India" and "Out of India".

(iii) Segment Revenue :

Segment Revenue comprises of Sales and related income that are directly identifiable with the Segment.

(iv) Segment Expenses:

Directly identifiable with the segment are charged to the respective Segment.

(v) All the accounting policies adopted for the Segment reporting are inline with those of the Company. Note No:- 25

3. As per AS-18 "Related Party Disclosures" :

(a) No transaction of sale, purchase or supply of any goods material or services has been entered into by the company with the promoters, Directors their relatives etc.

(b) Key management personnel - Sri J K Agrawal, Managing Director (Managerial remuneration paid is Rs 19.01 lacs), Sri A K Dhawan, Director (Finance) (Managerial remuneration paid is Rs. 8.41 lacs).

4. As per AS-22 Taxes on Income:

No provision of Income Tax has been made due to the carried forward losses and unabsorbed depreciation of earlier year.

As per AS-22 deferred tax assets should be recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. AS-22 also describes that where an enterprise has unabsorbed depreciation or carry forward losses under tax laws, deferred tax should be recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will available against which such deferred tax assets can be realized.

Since there is no virtual certainty supported by convincing evidence for any future taxable income, deferred tax assets have not been recognized during the current year.

5. As per AS-28 'Impairment of Assets'

During the year, closing stock of finished products has been valued by including the estimated amount of excise duty payable thereon, Rs 22.50 lacs as per the ICAI guidelines, However, this has no effect on the profit of the company for the year.

B. Guarantee, Counter Guarantee issued in favour of Bank are R.166.82 lacs (2014- Rs.166.82 lacs ) and in respect of Letter of Credit Rs.60 Lacs (2014-Rs.60 lacs ):

C. Total expenditure incurred on Research & Development during the year Rs. 0.26 lacs (2013- 14 Rs.0.72 Lacs)

D. Depreciation has not been provided for Allahabad Plants as the same has been closed since March 2006 and due to wear and tear over the years they are presently unusable.

E. No Revenue recognition has been postponed during the current year

F. During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs.22.50 lacs as per the ICAI guidelines, However, this has no effect on the profit of the Company for the year.

G. Figures of previous year have been regrouped and rearranged wherever found necessary.

H. No Borrowing cost has been capitalized during the year

I. The names of SSI Units to whom Rs. 1.00 lac or more is outstanding for more than 30 days are Varun Industries, Capricon Stypack (I) Pvt Ltd. and Bedi Enterprises. No interest has been provided on these dues as the BIFR has declared it as a sick company.

J. Principal amounting to Rs. 1763.00 Lacs and Interest default was Rs 2174.00. Lacs during the current year. (Last year Principal default was Rs.2908.00 lacs and Interest default was Rs. 1724.50 Lacs).


Mar 31, 2014

NOTE NO.1 Contingent liabilities and receivables :

i) Contingent liabilities:

(a) The Company received Show-cause cum Demand Notices in routine way regarding non- admissibility of Modvat credit due to technical defects in documentation. Most of the defects are curable and are allowed at the first or second stage of hearing. As on 31.03.2014, such show- cause cum demand notices proposing to disallow modvat credit stood at Rs. 122.00 lacs (2012- 13 Rs. 122.00 lacs).

(b) The Commissioner Central Excise reconfirmed demand of Rs 20.96 crores and imposed equal penalty thereon after adjudicating the case. He also imposed penalties on Directors and Senior Officers of the Company. We have filed appeal against the order along with the stay application for waiver or pre deposit before Central Excise Tribunal New Delhi.

(c) Sales Tax Department has created a demand of Rs. 107.21 lacs (2013-Rs.107.21 lacs) disputing the rate of tax on Tinted Glass and other sales tax matters, which the Co. has not admitted and filed appeal against above mentioned demands, However, the Hon''ble Court has dismissed our appeal against which we have filed SLP before Hon''ble Supreme Court and the SLP has been admitted on 20.04.2011 for final hearing. Allahabad High Court has also disallowed our appeal against higher rate of tax on Tinted Glass for period subsequent to 1996 onwards and we are filing SLP against the same before the Honorable Supreme Court to be tied up and to be decided in due course

(d) Modvat credit on capital goods availed during installation of Float Glass plant to the extent of Rs. 7.26 Crores was disallowed by Jurisdictional Deputy Commissioner and equal penalty was imposed by wrongly treating Float Glass as a separate and independent unit while the fact is otherwise. Float Glass Plant is an expansion of the then factory and the department itself has endorsed Float Glass Plant in our Central Excise License (Registration Certificate) as expansion. Against, the order of the Commissioner (Appeals), we have filed appeal before CESTAT, New Delhi, which has completely waived pre-deposit of 50% of the required amount. Now the case will be heard and decided on merits in due course.

(e) There is EPCG license liability for Rs. 276 lacs plus interest amounting to Rs.479 lacs for non- fulfillment of export obligation in time. Our appeal has been dismissed by the Tribunal and thus we have filed appeal before BIFR for stay of recovery of the amount and waiver of interest amount. Besides DGFT has issued show case notices for recovery of Rs.405 lacs on account of Non-fulfillment of Export obligations against advance licenses. We have fulfilled the export obligation against some of the licenses but the documentary evidence being submitted by us is not acceptable to the Department. The company has filed appeal before BIFR vide its Draft Restructuring Proposal for waiving the export obligation and interest thereon.

(f) The termination of the services of the 50 workers employed in PPG Plant was referred to arbitration which ruled the termination as illegal and recommended for restoration of concerned employees back in the services. The Hon''ble Allahabad High Court also confirmed the order. The company filed an SLP before the Hon''ble Supreme Court where the matter has been ultimately settled and the company has been asked to pay the dues of concerned workers as computed by the labour court, Allahabad in four installments. The company has already paid Rs.61 lacs in two installments against total dues of Rs.1,23,39,061 by now. (g) Our request for remission on Duty of Finished goods has been rejected by the Assistant Commissioner, thus creating a demand of Rs 43237/- and equal penalty thereon. We have filed appeal against the said order.

(h) Being aggrieved with the order of Commissioner Appeals confirming demand of Rs 130372 and imposing equal penalty thereon for allegedly charging higher prices from deposit compared to expected prices . We have filed appeal before Central Excise Tribunal Delhi which has directed us to deposit of the balance amount till the case is finally decided The amount has been adjusted against the input credit available with us.

Segment Reporting as per Accounting Standard AS-17 issued by Institute of Chartered Accountants of India. (i) Business Segments:

The Company has considered "Business Segment" as the Primary Segment for disclosures, which comprises of Flat Glass .

(ii) Geographical Segments:

Geographical Segment is the "Secondary Segment" and location of its market I.e. "India" and "Out of India".

(iii) Segment Revenue :

Segment Revenue comprises of Sales and related income that are directly identifiable with the Segment.

(iv) Segment Expenses:

Directly identifiable with the segment are charged to the respective Segment.

(v) All the accounting policies adopted for the Segment reporting are inline with those of the Company.

Note No:- 25

As per AS-18 "Related Party Disclosures" :

(a) No transaction of sale, purchase or supply of any goods material or services has been entered into by the company with the promoters, Directors their relatives etc.

(b) Key management personnel - Sri J K Agrawal, Managing Director (Managerial remuneration paid is Rs0.32 lacs), Sri A K Dhawan, Director (Finance) (Managerial remuneration paid is Rs. 8 .09 lacs).

Note No:- 2

As per AS-22 Taxes on Income:

No provision of Income Tax has been made due to the carried forward losses and unabsorbed depreciation of earlier year.

As per AS-22 deferred tax assets should be recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. AS-22 also describes that where an enterprise has unabsorbed depreciation or carry forward losses under tax laws, deferred tax should be recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will available against which such deferred tax assets can be realized.

Since there is no virtual certainty supported by convincing evidence for any future taxable income, deferred tax assets have not been recognized during the current year.

Note No:- 3

As per AS-28 "Impairment OF Assets

During the year, closing stock of finished products has been valued by including the estimated amount of Excise Duty payable thereon, Rs.64.60 lacs as per the ICAI guidelines, However, this has no effect on the profit of the Company for the year.

Note No:- 4

1. Other points

A. Earnings Per Share

B. Guarantee, Counter Guarantee issued in favour of Bank are R.166.82 lacs (2013- Rs.166.82 lacs ) and in respect of Letter of Credit Rs.60 Lacs(2013-Rs.40 lacs ):

C. Total expenditure incurred on Research & Development during the year Rs.72392.19 (2013- Rs.0.86 Lacs)

D. Depreciation amounting to Rs. 647.15 lacs has not been provided during the year for Float as the Plant was closed during the year.

E. No Revenue recognition has been postponed during the current year

F. During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs.64.60 lacs as per the ICAI guidelines, However, this has no effect on the profit of the Company for the year.

G. Figures of previous year have been regrouped and rearranged wherever found necessary. H. No Borrowing cost has been capitalized during the year

I. The names of SSI Units to whom Rs. 1.00 lac or more is outstanding for more than 30 days are Varun Industries, Capricon Stypack (I) Pvt Ltd. and Bedi Enterprises. No interest has been provided on these dues as the BIFR has declared it as a sick company.

J. Principal amounting to Rs.2908 Lacs and Interest default was Rs1724.50. Lacs during the current year. (Last year Principal default was Rs.5090.94 lacs and Interest default was Rs. 6485.24 Lacs).


Mar 31, 2013

NOTE N0.1 Contingent liabilities and receivables :

i) Contingent liabilities:

(a) The Company received Show-cause cum Demand Notices in routine way regarding non- admissibility of Modvat credit due to technical defects in documentation. Most of the defects are curable and are allowed at the first or second stage of hearing. As on 31.03.2013, such show-cause cum demand notices proposing to disallow modvat credit stood at Rs. 122.00 lakhs (2011-12 Rs. 122.00 lakhs).

(b) The Commissioner Central Excise reconfirmed demand of Rs 20.96 crores and imposed equal penalty thereon after adjudicating the case. He also imposed penalities on Directors and Senior Officers of the Company. We have filed appeal against the order along with the stay application for waiver or pre deposit before Central Excise Tribunal New Delhi.

(c) Sales Tax Department has created a demand of Rs. 107.21 lakhs (2012-Rs.107.21 lacs) disputing the rate of tax on Tinted Glass and other sales tax matters, which the Co. has not admitted and filed appeal against above mentioned demands, However, the Hon''ble Court has dismissed our appeal against which we have filed SLP before Hon''ble Supreme Court and the SLP has been admitted on 20.04.2011 for final hearing. Allahabad High Court has also disallowed our appeal against higher rate of tax on Tinted Glass for period subsequent to 1996 onwards and we are filing SLP against the same before the Honorable Supreme Court to be tied up and to be decided in due course

(d) Modvat credit on capital goods availed during installation of Float Glass plant to the extent of Rs. 7.26 Crores was disallowed by Jurisdictional Deputy Commissioner and equal penalty was imposed by wrongly treating Float Glass as a separate and independent unit while the fact is otherwise. Float Glass Plant is an expansion of the then factory and the department itself has endorsed Float Glass Plant in our Central Excise License (Registration Certificate) as expansion. Against, the order of the Commissioner (Appeals), we have filed appeal before CESTAT, New Delhi, which has completely waived pre-deposit of 50% of the required amount. Now the case will be heard and decided on merits in due course.

(e) There is EPCG license liability for Rs. 276 lakhs plus interest amounting to Rs.479 lakhs for non-fulfillment of export obligation in time. Our appeal has been dismissed by the Tribunal and thus we have filed appeal before BIFR for stay of recovery of the amount and waiver of interest amount. Besides DGFT has issued show case notices for recovery of Rs.405 lakhs on account of Non-fulfillment of Export obligations against advance licenses. We have fulfilled the export obligation against some of the licenses but the documentary evidence being submitted by us is not acceptable to the Department. The company has filed appeal before BIFR vide its Draft Restructuring Proposal for waiving the export obligation and interest thereon.

(f) The termination of the services of 50 workers employed in PPG was referred to Arbitration and the arbitrator by its award dated 31.10.2006 declared the termination as illegal and recommended for restoration of the concerned employees in the services the matter was agitated before Honorable High Court of Allahabad which also conformed the award by its order dt. 13.2.2008. An SLP was ultimately filed before the Supreme Court which stayed the operation of the award subject to the condition that the company deposits Rs.55 lakhs with Deputy Labour Commissioner (DLC), Allahabad as interim relief to the concerned workers.

The company has already deposited Rs 55 lacs with DLC, Allahabad who under instruction of the Honourable Supreme Court submitted computation of concerned worker dues up to Dec 2006, but the same has been disputed by both workers and the company and the matter is subjudice before labour Court.

(g) Our request for remission on Duty of Finished goods has been rejected by the Assistant Commissioner, thus creating a demand of Rs 43237/- and equal penalty thereon. We have filed appeal against the said order.

(h) Being aggrieved with the order of Commissioner Appeals confirming demand of Rs 130372 and imposing equal penalty thereon for allegedly charging higher prices from deposit compared to expected prices . We have filed appeal before Central Excise Tribunal Delhi which haS directed us to deposit of the balance amount till the case is finally decided The amount has been adjusted against the input credit available with us.

Note No.2 As per AS 15

Retirement benefits namely gratuity & earned leave liability for Rajahmundry employees has been duly provided in Allahabad books.

Segment Reporting as per Accounting Standard AS-17 issued by Institute of Chartered Accountants of India. (i) Business Segments:

The Company has considered "Business Segment" as the Primary Segment for disclosures, which comprises of Flat Glass.

(ii) Geographical Segments:

Geographical Segment is the "Secondary Segment" and location of its market I.e. "India" and "Out of India".

(iii) Segment Revenue:

Segment Revenue comprises of Sales and related income that are directly identifiable with the Segment.

(iv) Segment Expenses:

Directly identifiable with the segment are charged to the respective Segment.

(v) All the accounting policies adopted for the Segment reporting are inline with those of7 the

Company.

Note No:- 3

As per AS-18 "Related Party Disclosures"

(a) No transaction of sale, purchase or supply of any goods material or services has been entered into by the company with the promoters, Directors their rSfatiVe^etc.

(b) Key management personnel - Sri J K Agrawal, Managing Director (Managerial remuneration paid is Rs. 1.52 lacs), Sri A K Dhawan, Director (Finance) (Managerial- remuneration paid isHs.7.86 lakhs).

Note No:- 4

As per AS-22 Taxes on Income:

No provision of Income Tax has been made due to the carried forward losses and unabsorbed depreciation of earlier year.

As per AS-22 deferred tax assets should,be recognized and carried forward only to the extent that there is reasonable certainty that sufficient fujtuf(| taxable jrtpome will be available against which such deferred tax assets can.be,r^aljz,ed. AS-<>2 aJ[s.Q jdes.qribes that where an enterprise has unabsorbed depreciation or carry forward losses under tax laws, deferred tax should be recognized only to the extent tba,t there Mirtujaj ce^ajpty supported by^pnvincing evidence that sufficient future taxable income will available against which,such deferred tax assets can be reateed.

Since there is no virtual certainty supported,, l-yconvincing eyjd(er>ce,|pr any''.future,taxable income, deferred tax assets-have not beer* recognized during the current year,,

Note No:- 5

As per AS-28 "Impairment OF Assets

During the year, clpsjrjg ..stock of finished ^coduct^ h^s been yaM^Qd b^ including the estimated, amount o^Exgjse. Duty payabj^ thereon, Rs.7;Q3 lakhs as^per the JCAI ,g.ujgelines, However, this has no, effect on the profit of. the Qwrtoany fp£ $e year.

Note No:- 6

1. Other points

A. Earnings Per Share :

B. Guarantee, Counter Guarantee issued in favour of Bank are 166.82 lacs (2012- Rs. Nil) and in respect of Letter of Credit R:s.40 Lacs (2011 -Rs.40 lacs):

C. " Total expenditure incurred on Research & Development during the year was Rs.0.86 lacs (2012-Nil)

D. Depreciation amounting to Rs.647.15 lakhs has not been provided during the year for Float as the Plant was closed during the year.''

E. No Revenue recognition has been postponed during the current year

F. During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs.7.03 lakhs as per the ICAI guidelines, However, this has no effect on the profit of the Company for the year.

G. Figures of previous year have been regrouped and rearranged wherever found necessary. H. No Borrowing cost has been capitalized during the year

I. The names of SSI Units to whom Rs. 1.00 lakh or moij! is outstanding for more than 30 days are Varun Industries, Capricon Stypack (I) Pvt Ltd. and Bedi Enterprises. No interest has been provided on these dues as the BlFR has declared it as a sick company.

J. Principal amounting to Rs.5090.04 Lakhs and Interest default was Rs.6485.24 Lakhs during the current year. (Last year Principal default was Rs. 5471.90lakhs and Interest default was Rs. 6485.24 Lakhs).


Mar 31, 2012

NOTE N0.1 Contingent liabilities and receivables :

i) Contingent liabilities:

(a) The Company received Show-cause cum Demand Notices in routine way regarding non-admissibility of Modvat credit due to technical defects in documentation. Most of the defects are curable and are allowed at the first or second stage of hearing. As on 31.03.2012, such show-cause cum demand notices proposing to disallow modvat credit stood at Rs. 122.00 lakhs (2010-11 Rs. 137.55 lakhs).

(b) As reported earlier the Central Excise Tribunal New Delhi had remanded the Ex-parte order passed earlier by Commissioner Central Excise Allahabad confirming the demand of Rs.20.96 crores with equal penalty thereon. Now the case is fixed for fresh hearing by present Commissioner of Central Excise, Allahabad.

(c) Sales Tax Department has created a demand of Rs. 107.21 lakhs (2011-Rs.107.21 lacs) disputing the rate of tax on Tinted Glass and other sales tax matters, which the Co. has not admitted and filed appeal against above mentioned demands, However, the Hon'ble Court has dismissed our appeal against which we have filed SLP before Hon'ble Supreme Court and the SLP has been admitted on 20.04.2011 for final hearing.

(d) Modvat credit on capital goods availed during installation of Float Glass plant to the extent of Rs. 7.26 Crores was disallowed by Jurisdictional Deputy Commissioner and equal penalty was imposed by wrongly treating Float Glass as a separate and independent unit while the fact is otherwise. Float Glass Plant is an expansion of the then factory and the department itself has endorsed Float Glass Plant in our Central Excise License (Registration Certificate) as expansion. Against, the order of the Commissioner (Appeals), we have filed appeal before CESTAT, New Delhi, which has completely waived pre-deposit of 50% of the required amount. Now the case will be heard and decided on merits in due course.

(e) EPCG license liability for Rs. 276 lakhs plus interest amounting to Rs.479 lakhs for non-fulfillment of export obligation in time. Our appeal has been dismissed by the Tribunal and thus we have filed appeal before BIFR for stay of recovery of the amount and waiver of interest amount. Besides DGFT has issued show case notices for recovery of Rs.405 lakhs on account of Non-fulfillment of Export obligations against advance licenses we have fulfilled the export obligation against some of the licenses but the documentary evidence being submitted by us is not acceptable to the Department. The company has filed appeal before BIFR vide its Draft Restructuring Proposal for waiving the export obligation and interest thereon.

(f) The termination of the services of 50workers employed in PPG Plant was referred to Arbitration and the Arbitrator by its award dated 31.10.2006 declared the termination as illegal and recommended for restoration of the concerned employees in the services the matter was agitated before Hon'ble High Court of Allahabad which also confirmed the award by its order dt. 13.2.2008. An SLP was ultimately filed before the Supreme Court which stayed the operation of the award subject to the condition that the company deposits Rs.55 lacs with Deputy Labour Commissioner (DLC), Allahabad as interim relief to the concerned workers.

The company has already deposited Rs.55 lacs with DLC, Allahabad, The Hon'ble Supreme Court also directed DLC, Allahabad to submit a report computing the total dues of the concerned workers

The company has already deposited Rs.55 lacs with DLC, Allahabad, The Hon'ble Supreme Court also directed DLC, Allahabad to submit a report computing the total dues of the concerned workers upto 30.12.2006. During this process 15 workers have already taken their final accounts leaving only 35 workers to be settled. As per our records the total dues of the concerned workers comes to Rs.191.95 lakhs out of which PF dues account for Rs. 120.62 lakhs leaving a balance of Rs.71.34Lakhs against which we have deposited Rs.55 lacs with DLC, Allahabad. Thus the net due Works out to Rs.16.34Lakhs but DLC, Allahabad has also included in its report payment of salary for those workers for the period 23.1.2004 to 5.1.2005 amounting to Rs.20.52 Lakhs during which period he workers were on strike the dispute was settled by an agreement between Union and the management in presence of the then Deputy Labour Commissioner on 20.3.2006 whereby an ex-cretia payment of Rs. 12000 was given to each of the worker. We have raised this point and hence requested DLC, Allahabad to send the supplementary report to the Hon'ble Supreme Court incorporating the above correction. The next date of hearing is on 29.10.2012.

(ii) Contingent receivables:

(a) Refund claims of Rs. 340 lakhs (December 2010 - Rs. 340 lakhs) for Allahabad unit and Rs. 27.67 lakhs for Rajahmundry unit were pending before Appellate Authorities. Out of the above refund claim of Rs. 52 lakhs has been received back. We have also received further refund order for Rs. 189 Lacs on account of Allahabad unit subject to furnishing of Bank Guarantee in line with the order passed by Hon'ble Supreme Court in the case of earlier refund claim of Rs. 52 lacs . We have been pursuing the matter with the Deptt and also of earlier hearing of SLP filed by department before Hon'ble Supreme Court. Modvat credit to the tune of Rs.30.50 lacs is due to the Company at its Rajamundry Plant.

Note No-2

(A) Segment Information As per AS - 17

(i) Business Segment

(1) Segment Revenue

Segment Reporting as per Accounting Standard AS-17 issued by Institute of Chartered Accountants of India.

(i) Business Segments:

The Company has considered "Business Segment" as the Primary Segment for disclosures, which comprises of Flat Glass and Neutral Glass Tube.

(ii) Geographical Segments:

Geographical Segment is the "Secondary Segment" and location of its market I.e. "India" and "Out of India".

(iii) Segment Revenue :

Segment Revenue comprises of Sales and related income that are directly identifiable with the Segment.

(iv) Segment Expenses:

Directly identifiable with the segment are charged to the respective Segment.

(v) All the accounting policies adopted for the Segment reporting are inline with those of the Company.

Note No:- 3

As per AS-18 "Related Party Disclosures" :

(a) No transaction of sale, purchase or supply of any goods material or services has been entered into by the company with the promoters, Directors their relatives etc.

(b) Key management personnel - Sri J K Agrawal, Managing Director (Managerial remuneration paid is Rs. Nil), Sri A K Dhawan, Director (Finance) (Managerial remuneration paid is Rs.8.19 lakhs).

Note No:- 4

As per AS-22 Taxes on Income:

No provision of Income Tax has been made due to the carried forward losses and unabsorbed depreciation of earlier year.

As per AS-22 deferred tax assets should be recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. AS-22 also describes that where an enterprise has unabsorbed depreciation or carry forward losses under tax laws, deferred tax should be recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will available against which such deferred tax assets can be realized. Since there is no virtual certainty supported by convincing evidence for any future taxable income, so deferred tax assets has not been recognized during the current year.

Note No:- 5

As per AS-28 "impairment OF Assets

During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs. 15.41 lakhs as per the ICAI guidelines, however this has no effect on the profit of the Company for the year.

B. Guarantee, Counter Guarantee issued in favour of Bank are Nil (2011- Rs. 57.68 lakhs) and in respect of Letter of Credit Rs.40 Lacs (2011-Rs.40 lacs):

C. Total expenditure incurred on Research & Development during the year was Rs. Nil (2011- Nil)

D. Depreciation amounting to Rs.647.15 lakhs has not been provided during the year for Float as the Plant was closed during the year.

E. No Revenue recognition has been postponed during the current year

F. During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs.15.41 lakhs as per the ICAI guidelines, however this has no effect on the profit of the Company for the year.

G. Figures of previous year have been regrouped and rearranged wherever found necessary.

H. No Borrowing cost has been capitalized during the year

I. The names of SSI Units to whom Rs. 1.00 lakh or more is outstanding for more than 30 days are Varun Industries, Capricon Stypack (I) Pvt Ltd. and Bedi Enterprises. No interest has been provided on these dues as the company has applied to BIFR to be declared as a sick company.

J. Principal amounting to Rs.5471.90 Lakhs and Interest default was Rs.6485.24 Lakhs during the current year. (Last year Principal default was Rs. 5695 lakhs and Interest default was Rs. 6457.67 Lakhs).

k. Installed Capacity as on 31.03.2012 and Actual Production (Net of Breakages).


Mar 31, 2010

(i) Business Segments:

The Company has considered "Business Segment" as the Primary Segment for disclosures, which comprises of Flat Glass and Neutral Glass Tube.

(ii) Geographical Segments:

Geographical Segment is the "Secondary Segment" and location of its market I.e. "India" and "Out of India".

(iii) Segment Revenue:

Segment Revenue comprises of Sales and related income that are directly identifiable with the Segment.

(iv) Segment Expenses:

Directly identifiable with the segment are charged to the respective Segment.

(v.) All the accounting policies adopted for the Segment reporting are inline with those of the Company.

(vi) Segment Revenue . *

(a) extraordinary items as defined in AS-5, Net Profit or Loss for the period, prior period items and changes in accounting policies.

(b) Interest or dividend income.

(c). gains on sale of investments or on extinguishment of debt unless the operations of the segment are primarily of financial nature.

(k) Contingent liabilities and receivables :

i) Contingent liabilities :

(a) The Company received Show-cause cum Demand Notices in routine way regarding non- admissibility of modvat credit due to technical defects in documentation. Most of the defects are curable and are allowed at the first or second stage of hearing. As on 31.03.2010, such show-cause cum demand notices proposing to disallow modvat credit stood at Rs. 129.32 lakhs (2009-Rs.140.05 lakhs).

(b) the Commissioner Central Excise, Allahabad has created a duty demand of Rs. 20.96 Crores and has imposed equal penalty thereon by an ex-parte order. On our appeal before CESTAT, the CESTAT ordered to deposit 50% duty demanded with penalties. Allahabad High Court slightly modified the order on our writ petition. The company filed SLP before Supreme Court and as per Apex Court Order has made necessary cash pre- deposit. The company has also offered first charge on the assets of the company pari passu with that of IDBI in lieu of Bank Guarantee. Inspite of departments reluctance, Central Excise Tribunal has restored the case to its position on the basis of offer made by the company subject to the conditions that the assets of the Company will not be alienated during the pendency of the appeal.

(c) Sales Tax Department has created a demand of Rs. 107.21 lakhs disputing the rate of tax on Tinted Glass and other sales tax matters, which the Co. has not admitted and filed appeal against above mentioned demands, However, the Honble Court has dismissed our appeal against which we have filed SLP before Honble Supreme Court and the case is likely to come up for hearing soon.

(d) Modvat credit on capital goods availed during installation of Float Glass plant to the extent of Rs. 7.26 crores was disallowed by Jurisdictional Deputy Commissioner and equal penalty was imposed by wrongly treating Float Glass as a separate and independent unit while the fact is otherwise. Float Glass Plant is an expansion of the then factory and the . department itself has endorsed Float Glass Plant in our Central Excise License (Registration Certificate) as expansion. Against, the order of the Commissioner (Appeals), we have filed appeal before CESTAT, New Delhi, which has completely waived pre- deposit of 50% of the required amount. Now the case will be heard and decided on merits in due course.

(e) EPCG license liability for Rs. 276 lakhs plus interest amounting to Rs.479 lakhs for non- fulfillment of export obligation in time. Our appeal has been dismissed by the Tribunal and thus we have filed appeal before BIFR for stay of recovery of the amount and waiver of interest amount. Besides DGFT has issued show case notices for recovery of Rs.405 lakhs on account of Non-fulfillment of Export obligations against advance licenses we have fulfilled the export obligation against some of the licenses but the documentary evidence being submitted by us is not acceptable to the Department. The company has filed appeal before BIFR vide its Draft Restructuring Proposal for waiving the export obligation and interest thereon.

(ii) Contingent receivables:

(p) Refund claims of Rs. 340 lakhs (December 2007 - Rs. 340 lakhs) for Allahabad unit and Rs. 27.67 lakhs for Rajahmundry unit were pending before Appellate Authorities. Out of the above refund claim of Rs. 52 lakhs has been received back. We have also received further refund order for Rs. 189 Lacs on account of Allahabad unit subject to furnishing of Bank Guarantee in line with the order passed by Honble Supreme Court in the case of earlier refund claim of Rs. 52 lacs . We have been pursuing the matter with the Deptt and alsp of earlier hearing of SLP filed by department before Honble Supreme Court.

I. Guarantee, Counter Guarantee issued in favour of Bank are Rs.57.68 (2009- Rs. 82.68 lakhs) and in respect of Letter of Credit Rs.52.50 (2009-Rs.Nil):

m. Total expenditure incurred on Research & Development during the year was Rs. Nil (2009-Rs. Nil)

n. Depreciation amounting to Rs.653.53 lakhs has not been provided during the year for Float as the Plant was closed during the year.

o. No Revenue recognition has been postponed during the current year

p. Taxes on Income:

No provision of Income Tax has been made due to the carried forward losses and unabsorbed depreciation of earlier year.

As per AS-22 deferred tax assets should be recognized and carried forward only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realized. AS-22 also describes that where an enterprise has unabsorbed depreciation or carry forward losses under tax laws, deferred tax should be recognized only to the extent that there is virtual certainty supported by convincing evidence that sufficient future taxable income will available against which such deferred tax assets can be realized.

Since there is no virtual certainty supported by convincing evidence for any future taxable income, so deferred tax assets has not been recognized during the current year.

q. As per Accounting Standard - 28 "Impairment of Assets" issued by ICAI, no impairment loss has been considered during the year in respect of the relevance of the Company in view of negligible residual value of assets and their estimated disposal value.

r. During the year, closing stock of finished products have been valued by including the estimated amount of Excise Duty payable thereon Rs.4.38 lakhs as per the ICAI guidelines, however this has no effect on the profit of the Company for the year.

s. Figures of previous year have been regrouped and rearranged wherever found necessary.

t. No Borrowing cost has been capitalized during the year

u. The names of SSI Units to whom Rs. 1.00 lakh or more is outstanding for more than 30 days are Varun Industries, Capricon Stypack (I) Pvt Ltd. and Bedi Enterprises. No interest has been provided oh these dues as the company has applied to BIFR to be declared as a sick company.

v. "Related Party Disclosures":

(a) No transaction of sale, purchase or supply of any goods material or services have been entered into by the company with the promoters, Directors their relatives etc.,

(b) Key management personnel - Sri J K Agrawal, Managing Director (Managerial remuneration paid is Rs. Nil ), Sri A K Dhawan, Director (Finance) (Managerial remuneration paid is Rs.8.37 lakhs)

x. Principal amounting to Rs.5695 Lakhs and Interest default was Rs.6457.67 Lakhs during the current year. (Last year Principal default was Rs. 7227 lakhs and Interest default was Rs. 6310 Lakhs)

y. Rs. 138.56 Lakhs towards wages pertaining to workers of PPG Plant is due in view of the judgment delivered by Honorable High Court, Allahabad. However, the Company has filed SLP in the Honorable Supreme Court of India against the said Judgment on 13th May 08.

z. On 13th January 2010 the Board of Directors announced a plan to dispose of Company Neutral Glass Division situated at Village Fitkari, Mawana Road, Meerut which is also a separate segment as per AS 17 segment reporting. Further the Meerut facility of the Company has not been running properly since.the past few years and the management feels it would not be possible to turn it bright and it does not appear in around and thus it is better to dispose of the unit when the company is getting a good consideration for the same. In the above circumstances the company has been under pressure from the Institution lender and Banks to repay back their loans and therefore it was decided to sell off this unit of the Company.

 
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