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Notes to Accounts of Vadilal Industries Ltd.

Mar 31, 2015

A) Future cash outflows in respect of A (II) (i) to (iv) above depends on ultimate settlement / conclusions with the relevant authorities.

b) Future cash outflows in respect of A (II) (v) above depends if company is unable to fulfill export obligations between 2019-20 to 2023-24 of Rs. 3917.36 Lacs (P.Y. Rs. 4971.39 Lacs), for import made between the year of 2009-10 to 2014-15. The fulfillment of export obligation is considered on the basis of license claimed at the time of export.

1.)Pursuant to Section 74(1) of the Companies Act 2013, The Company has to repay the amount of such deposits along with interest thereon, if any, within 1 year from such commencement or from the date on which such payment are due, whichever is earlier. The company has repaid all the deposits which are due up to 31.03.2015. Moreover for the deposits which remain undue as on 31.03.2015, the company has filed the petition under section 74(2) of the companies act, 2013 and awaiting for the reply.

2.)Capitalisation of Expenditure:

During the year, the company has capitalized the following expenses of revenue nature to the cost of fixed asset/capital work-in-progress (CWIP). Consequently, expenses disclosed under the respective notes are net of amounts capitalized by the company.

* Loans and Advance shown above, to Subsidiaries fall under the category of "Long Term Loans and Advances" in the nature of Loans where there is no repayment schedule and are repayable on demand. Such Loans and Advances is given free of Interest.

# Company has made investment in equity of overseas subsidiary company for Rs. 136.41 Lacs (Value after diminution Rs. 1.36 lacs) and by way of loans Rs. 196.93 Lacs for the purpose of initial development and long term growth. During the year subsidiary Company has incurred loss of Rs. 136.59 Lacs(Accumulated losses Rs. 379.97 Lacs). In view of long term involvement and expected increase in business of subsidiary, the company considers that the exposure and Trade Receivable for Rs. 356.70 Lacs will be fully realisable. However, the company has written off the value of long term loans & advances of subsidiary company of Rs. 196.93 Lacs, which has been shown as an exceptional item in the profit and Loss statement of the year.

3.)PARTICULARS OF DERIVATIVE INSTRUMENTS :

a) Derivative contracts entered into by the company and outstanding as on 31st March, 2015: i) All derivative and financial instruments acquired by the company are for hedging.

4.) MAT CREDIT ENTITLEMENT :

On the basis of the projection for future profit, the company projects,to pay normal income tax within the specified period. Based on this assumption, the company has taken MAT Credit of Rs.58.50 Lacs (P.Y. Rs. 89.94 Lacs)and shown as MAT credit entitlement of total amounting to Rs. 551.85 Lacs as on 31.3.15 (P.Y. Rs.493.35 Lacs).

5.) Disclosure under Accounting Standards

5.1) (i) Defined Contribution Plans:

Amount of Rs. 86.54 Lacs is recognised as expense and included in "Employee Benefits Expenses" in the Statement of Profit and Loss.

(ii) Defined Benefit Plans :

Note: Amount not available for experience adjustment of earlier years on plan liabilities and on plan Assets as per acturial certificate for Gratuity Plan.

(h) The company expects to fund Rs. 53.00 Lacs(P.Y.Rs. 32.20 Lacs)towards gratuity plan and Rs. 37.73 Lacs(P.Y Rs.34.30 Lacs) towards provident fund plan during the year 2015-16.

Notes :

I) The company provides retirement benefits in the form of Provident Fund, Gratuity and Leave Encashment. Provident fund contributions made to "Government Administrated Provident Fund" are treated as defined contribution plan since the company has no further obligations beyond its monthly contributions. Gratuity is treated as defined benefit plan, and is administrated by making contributions to Group Gratuity Scheme of Life Insurance Corporation of India and SBI Life-Cap Assure Gratuity Scheme. Leave encashment is considered as defined benefit plans is administrated by making contributions to the Group Leave Encashment Scheme of Life Insurance Corporation of India and Sick leave is considered as defined benefit plan and it remains unfunded.

6.) As per Accounting Standard (AS) 17, "Segment Reporting", segment information is provided in the Notes to Consolidated Financial Statements.

7.)RELATED PARTY DISCLOSURES : As per Accounting Standard 18.

A) Name of related party and description of relationship where control exists:

i) Vadilal Industries (USA) Inc. : Subsidiary Company

ii) Vadilal Cold Storage : Partnership firm where share is more than 51 %

iii) Vadilal Forex and Consultancy Services Ltd. : Associate

B) Name of related party and description of the relationship with whom transactions taken place.

1) Key Management Personnel :

i) Rajesh R Gandhi

ii) Devanshu L Gandhi

2) Enterprises owned or significantly influenced by key management personnel or their relatives :

i) Vadilal Enterprises Ltd.

ii) Vadilal International Pvt. Ltd.

iii) Veronica Construction Pvt.Ltd.

iv) Padm Complex Ltd.

v) Majestic Farm House Ltd.

vi) Ambica Dairy Products

vii) Volute Construction Ltd.

3) Relative of key Management Personnel :

i) Mamta R Gandhi

ii) Kalpit R Gandhi

iii) Aastha R Gandhi

8.) Previous year figures have been regrouped / reclassified wherever necessary to correspond with the current years classification / disclosure


Mar 31, 2013

NOTE : 1

Corporate Information:

The Company is engaged in the business of manufacturing Ice-cream, Flavored Milk, Frozen Dessert and processing and exporting Processed Food Products, such as Frozen Fruits, Vegetable, Canned Pulp,Ready-to-eat and Ready-to- serve products etc.

The Company is having two ice-cream production facilities – one in Gujarat and the other in Uttar Pradesh and sales its products in India except states of Maharashtra, Karnataka, Andhra Pradesh, Kerala and Goa.

The company is processing Frozen Fruits, Vegetables and Processed Foods at factory situated at Dharampur, Dist.Valsad, Gujarat. The Company is exporting to various Countries.

The company is having RBI license under AD.II category and engaged in Money changing business.

Note :2

BASIS OF PREPARATION:

The financial statements of the company have been prepared in accordance with generally accepted accounting principles in India (Indian GAAP).The company has prepared these financial statements to comply in all material respects with the accounting standards notified under the Companies (Accounting Standards) Rules,2006 (as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under the historical cost convention, except for certain fixed assets which are carried at revalued amount. The accounting policies adopted in the preparation of financial statements are consistent with those of previous year.

3.1) A) For the year 2012-13, though a formal policy is not pronounced by the distribution agency i.e. APEDA,

(Agricultural and Processed Food Products Export Development Authority) the company has accounted transport subsidy of Rs. 57 Lacs, based on anticipation of pronouncement of such policy considering announcements by government from time to time and such benefit being made available in past years. Such income is deducted from freight expense.

B) During the current year, the company has accounted interest subsidy for the year 2007-08 to 2011-12 of Rs. 89.79 Lacs as other income (Interest Income) on the basis of application approved by the Gujarat Agro Industrial Corporation Ltd.

3.2) Capitalisation of Expenditure:

During the year, the company has capitalized the following expenses of revenue nature to the cost of fixed asset/ capital work-in-progress (CWIP). Consequently, expenses disclosed under the respective notes are net of amounts capitalized by the company.

3.3) The company has written down the inventories to net realisable value during the year by Rs. 31.29 Lacs (Previous year Rs. 31.73 Lacs).

3.4)The information as required to be disclosed under the "Micro, Small and Medium Enterprises Development Act,2006" has been determined to the extent such parties have been identified on the basis of information available with the company. The disclosure relating to balance if any as at the year end have been given in Note No.-9. This is relied upon by the Auditors.

3.5) As per Accounting Standard (AS) 17, "Segment Reporting", segment information is provided in the Notes to Consolidated Financial Statements.

3.6) RELATED PARTY DISCLOSURES : As per Accounting Standard 18.

A) Name of related party and description of relationship where control exists. i) Vadilal Industries (USA) Inc. : Subsidiary Company

ii) Vadilal Cold Storage : Partnership firm where share is more than 51 % iii) Vadilal Forex and Consultancy Services Ltd : Associates

B) Name of related party and description of the relationship with whom transactions taken place.

1) Key Management Personnel : i) Virendra R Gandhi

ii) Rajesh R Gandhi iii) Devanshu L Gandhi

2) Enterprises owned or significantly influenced by key management personnel or their relatives : i) Vadilal Enterprises Ltd.

ii) Vadilal International Pvt. Ltd.

iii) Kalpit Reality & Services Ltd.

iv) Veronica Constructions Pvt.Ltd.

v) Padm Complex Ltd.

vi) Majestic Farm House Ltd.

vii) Volute Constructions Ltd.

viii) Ambica Dairy Products

3) Relative of key Management Personnel : i) Mamta R Gandhi

ii) Kalpit R Gandhi

3.7) OPERATING LEASE:-

i) The company has taken various residential, office and godown premises under operating lease or leave and licence agreements.These are generally not non-cancellable and range between 11 months and 36 months under leave and licence or longer for other leases and are renewable by mutual consent on mutually agreeable terms. The company has given refundable interest free Security deposits under certain agreements.

ii) Lease payments are recognised as expense in the Profit & Loss Statement on a straight line basis over the lease term under expense head "Rent" in Note 25 "Other Expenses."

4) Previous year figures have been regrouped/reclassified wherever necessary to correspond with the current years classification/disclosure.


Mar 31, 2011

1) [A] CONTINGENT LIABILITIES NOT PROVIDED FOR :

(Rs. in Lacs) C. Year P. Year

I) Guarantees given by the company against Term Loans given to 895.00 1245.00 companies in which Directors are interested.

Outstanding against this as at 31.03.2011 441.23 332.39

II) i) For Excise -

a) Related to a matter decided in favour of the company, against which the Excise department has preferred an appeal.Gross Rs. 18.03 lacs (P.Y. Rs. 18.03 lacs) Net of Tax 12.04 11.90

b) Related to a matter which is disputed by the company against which appeal is preferred.

Gross Rs. 1.16 lacs (P.Y. Rs. 1.53 lacs) Net of Tax 0.77 1.01

ii) For Income Tax -

a) which is disputed by the company and against which company has 6.94 4.49 preferred appeal, based on the demand notices raised by Income Tax Dept. and received by the company.

b) Against which Income Tax department has preferred appeal 166.65 125.10

c) In respect of erstwhile Vadilal Financial Services Limited (VFSL) 3.16 3.75 Income Tax Demand ( including interest) for which the company has preferred appeal.

iii) For Sales Tax -

Disputed by the company and against which company has preferred an appeal. Gross Rs. 83.11 lacs ( P.Y. Rs. 83.86 lacs ) Net of Tax 55.50 55.36

iv) For other Matters -

Gross Rs. 1.66 lacs (P.Y. Rs. 1.66 lacs) Net of Tax 1.11 1.10

v) In respect of other labour suits pending before - - various courts, liability is unascertainable.

vi) Differential amount of custom/excise duty 707.42 660.16 in respect of machinery imported under EPCG scheme.

Note : a) Future cash outflows in respect of A (II) (i) to (v) above depends on ultimate settlement / conclusions with the relevant authorities.

b) Future cash outflows in respect of A (II) (vi) above depends if company is unable to fulfill export obligations of Rs. 5986.67 Lacs (P.Y.Rs. 3960.95 Lacs) within next eight to twelve years.

2) INVESTMENT IN PARTNERSHIP FIRMS

ii) Amount of share of profit in partnership firm amounting to Rs. 39.46 Lacs have been accounted on the basis of unaudited financial statements of the partnership firm.

3) a) OPERATING LEASE:-

i) The company has taken various residential, office and godown premises under operating lease or leave and licence agreements. These are generally not non-cancellable and range between 11 months and 36 months under leave and licence or longer for other leases and are renewable by mutual consent on mutually agreeable terms. The company has given refundable interest free Security deposits under certain agreements.

ii) Lease payments are recognised as expense in the Profit & Loss Statement on a straight line basis over the lease term under expense head "Rent" and "Freight, Forwarding and Other distribution expenses" in Schedule 20 "Manufacturing and Other Expenses."

4) The company has written down the inventories to net realisable value during the year by Rs. 38.91 Lacs (Previous year Rs. 18.83 Lacs).

5) (i) Defined Contribution Plans:

Amount of Rs. 51.21 Lacs is recognised as expense and included in "Employee's Expenses" (Schedule 20) in the Profit and Loss Account.

(ii) Defined Benefit Plans :

(h) The company expects to fund Rs. 10.00 Lacs & Rs. 5.00 Lacs towards gratuity plan and Leave Encashment reaspectively and Rs. 20.00 Lacs towards provident fund plan during the year 2011-12.

Notes :

i) The company provides retirement benefits in the form of Provident Fund, Gratuity and Leave Encashment. Provident fund contributions made to "Government Administrated Provident Fund" are treated as defined contribution plan since the company has no further obligations beyond its monthly contributions. Gratuity is treated as defined benefit plan, and is administrated by making contributions to Group Gratuity Scheme of Life Insurance Corporation of India and SBI Life-Cap Assure Gratuity Scheme. Leave encashment is considered as defined benefit plans is administrated by making contributions to the Group Leave Encashment Scheme of Life Insurance Corporation of India and Sick leave is considered as defined benefit plan and it remains unfunded.

6) RELATED PARTY DISCLOSURES : As per Accounting Standard 18.

A) Name of related party and description of relationship where control exists. Vadilal Industries (USA) Inc. : Subsidiary Company (w.e.f. 11 August 2009)

Vadilal Cold Storage : Partnership firm where share is more than 51 %

B) Name of related party and description of the relationship with whom transactions taken place.

1) Associates: Vadilal Chemicals Ltd. (Upto 1st September, 2009)

2) Key Management Personnel :

i) Virendra R Gandhi

ii) Rajesh R Gandhi

iii) Devanshu L Gandhi

3) Enterprises owned or significantly influenced by key management personnel or their relatives :

i) Vadilal Enterprises Ltd.

ii) Vadilal International Pvt. Ltd.

iii) Kalpit Reality & Services Ltd.

iv) Vadilal Happiness Parlour Ltd.

v) Veronica Constructions Pvt. Ltd.

vi) Padm Complex Pvt. Ltd.

vii) Majestic Farm House Ltd.

viii) Volute Constructions Pvt. Ltd.

ix) Valiant Constructions Pvt. Ltd.

4) Relative of Key Management Personnel :

Mamta R Gandhi

7) Disclosure as required by Accounting Standard (AS) 29 "Provisions, Contingent Liabilities and Contingent Assets :

b) Nature of provisions :

In respect of others provisions, the nature thereof has not been disclosed on the grounds that it can prejudice the Interests of the company.

c) The timing and the probability of the outflow with regards to these matters depend on the ultimate settlement / conclusion with the relevant authorities.

8) EARNINGS PER SHARE :

a) The amount used as the numerator in calculating basic and diluted earnings per share is the net profit for the year disclosed in the profit and loss account.

b) The weighted average number of equity shares used as the denominator in calculating both basic and diluted earnings per share is 71,87,830.

9) As per Accounting Standard (AS) 17, "Segment Reporting", segment information is provided in the Notes to Consolidated Financial Statements.

10) PARTICULARS OF DERIVATIVE INSTRUMENTS :

a) Derivative contracts entered into by the company and outstanding as on 31st March, 2011:

i) All derivative and financial instruments acquired by the company are for hedging.

ii) Foreign currency exposure that are not hedged by derivative instruments as on 31st March, 2011- US $ 2888518 equal to Rs. 1292.59 Lacs ( Previous year US $ 2257314 equal to Rs. 1013.99 Lacs) Euro 51130 equal to Rs. 30.22 Lacs (Previous year Euro 511228 equal to Rs. 309.65 Lacs)

11) Based on the information available with the company, there are no suppliers who are registered under the Micro, Small and Medium Enterprises Development Act, 2006 as at March 31,2011. Hence, the disclosure relating to amounts unpaid as at the year end together with interest paid/payable under this Act have not been given. This is relied upon by the Auditors.

11) Previous year figures have been restated wherever necessary to make them comparable with current year's figures.


Mar 31, 2010

1) [A] CONTINGENT LIABILITIES NOT PROVIDED FOR : (Rs. In Lacs)

C. Year P. Year

I) Guarantees given by the company against Term Loans 1245.00 1245.00 given to companies in which Directors are interested.

Outstanding against this as at 31.03.2010 332.39 528.81

II) I) For Excise -

a) Related to a matter decided in favour of the company, against which the Excise department has preferred an appeal. Gross Rs 18.03 lacs (P.Y. Rs.18.03 lacs) Net of tax 11.90 11.90

b) Related to a matter which is disputed by the company against which appeal is preferred.

Gross Rs. 1.53 lacs (P.Y. Rs. 1.53 lacs) Net of Tax 1.01 1.01

II) For Income Tax -

a) which is disputed by the company and against which company 4.49 7.27 has preferred appeal, based on the demand notices

raised by Income Tax Dept. and received by the company.

b) Against which Income Tax department has preferred appeal 125.10 3.12

c) In respect of erstwhile Vadilal Financial Services Limited (VFSL) 3.75 10.36 Income Tax Demand (including interest) for which the company has preferred appeal.

III) For Sales Tax -

Disputed by the company and against which company

has preferred an appeal. Gross Rs 83.86 lacs (P.Y. Rs 68.37 lacs )

Net of Tax 55.36 45.13

Iv) For other Matters -

Gross Rs 1.66 lacs (P.Y. Rs. 1.66 lacs)

Net of Tax 1.10 1.10

v) In respect of other labour suits pending before

various courts, liability is unascertainable. - -

vi) Differential amount of custom/excise duty 660.16 390.85

in respect of machinery imported under EPCG scheme.

Note: a) Future cash outflows in respect of A (II) (i) to (v) above depends on ultimate settlement / conclusions with the relevant authorities.

b) Future cash outflows in respect of A (II) (vi) above depends if company is unable to fulfill export obligations of Rs. 3960.95 Lacs (P.Y. Rs. 2497.97 Lacs) within next eight to twelve years.

2) a) INVESTMENT IN PARTNERSHIP FIRMS

The details regarding investment in the total capital of the partnership firm as well as Profit/Loss sharing ratio of the company alongwith other partner is stated hereunder :

Investment in the Capital of- (Rs.in Lacs)

M/S Vadilal Cold Storage

Total Capital Rs. 142.90

investment in Capital Account Rs 140.00

Name of the Partners Share in Profit/ Losses of the firm

i) Vadilal Industries Limited 98%

ii) Vadilal Chemicals Limited 2%

b) Amount of share of profit in partnership firm amounting to Rs. 13.21 Lacs have been accounted on the basis of unaudited financial statements of the partnership firm.

3) a) Operating Lease:-

i) The company has taken various residential, office and godown premises under operating lease or leave and licence agreements. These are generally not non-cancellable and range between 11 months and 36 months under leave and licence or longer for other leases and are renewable by mutual consent on mutually agreeable terms. The company has given refundable interest free Security deposits under certain agreements.

ii) Lease payments are recognised as expense in the Profit & Loss Statement on a straight line basis over the lease term under expense head "Rent" and "Freight, Forwarding and Other distribution expenses" in Schedule 20 "Manufacturing and Other Expenses."

Note : rigures in Dracxeis relate io previous year. 4) a) The company has written down the inventories to net realisable value during the year by Rs. 18.83 Lacs (Previous vear Rs. 42.96 Lacs ).

UIHUIIUOU.

4) RELATED PARTY DISCLOSURES : As per Accounting Standard 18.

A) Name of related party and description of relationship where control exists.

Vadilal Industries (USA) Inc. Subsidiary Company (w.e.f. 11 August 2009)

Vadilal Cold Storage Partnership firm where share is more than 51 %

B) Name of related party and description of the relationship with whom transactions taken place.

1) Associates : Vadilal Chemicals Ltd. (Upto 1st September, 2009)

2) Key Management Personnel :

i) Virendra R Gandhi

ii) Rajesh R Gandhi

iii) Devanshu L Gandhi

3) Enterprises owned or significantly influenced by key management personnel or their relatives : i) Vadilal Enterprises Ltd.

ii) Vadilal International Pvt. Ltd.

iii) Kalpit Reality & Services Ltd.

iv) Vadilal Happinezz Parlour Ltd.

v) Veronica Constructions Pvt. Ltd.

vi) Padm Complex Pvt. Ltd.

vii) Majestic Farm House Ltd.

viii) Volute Constructions Pvt. Ltd.

ix) Valiant Constructions Pvt. Ltd.

8) EARNINGS PER SHARE

a) The amount used as the numerator in calculating basic and diluted earnings per share is the net profit for the year disclosed in the profit and loss account.

b) The weighted average number of equity shares used as the denominator in calculating both basic and diluted earnings per share is 71,87,830.

5) As per Accounting Standard (AS) 17, "Segment Reporting", segment Information Is provided In the Notes to Consolidated Financial Statements.

6) PARTICULARS OF DERIVATIVE INSTRUMENTS :

a) Derivative contracts entered into by the company and outstanding as on 31st March, 2010: i) All derivative and financial instruments acquired by the company are for hedging. ii) Foreign currency exposure that are not hedged by derivative instruments as on 31st March, 2010- US $ 2257314 equal to Rs. 1013.99 Lacs ( Previous year US $ 336284 equal to Rs. 169.55 Lacs) Euro 511228 equal to Rs. 309.65 Lacs (Previous year Euro 59876 equal to Rs. 37.82 Lacs)

7) Based on the information available with the company, there are no suppliers who are registered under the Micro, Smalt and Medium Enterprises Development Act, 2006 as at March 31,2010. Hence, the disclosure relating to amounts unpaid as at the year end together with interest paid/payable under this Act have not been given. This is relied upon by the Auditors. -

8) Previous year figures have been restated wherever necessary to make them comparable with current years figures.

 
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