Mar 31, 2015
1. Terms and rights attached to Shares.
A) Equity Shares.
The company has only one class of Equity share having a Par Value of
Rs. 2/- each. Each holder of equity share is entitled for one vote per
share. The company declares and pays dividend in Indian rupees. The
dividend proposed by the Board of Directors is subject to approval by
the share holders in the ensuing Annual General Meeting.
In the event of liquidation of the company, the holder of equity
shares will be entitled to receive remaining assets of the company,
after distribution of all preferential amounts. The distribution will
be in proportion to the number of equity shares held by the
shareholders.
2.0.5% Fully Convertible Preference Shares.
Each Fully Convertible Preference Share shall be compulsorily
converted into five equity share of Rs. 2/- each fully paid up at par,
at any time from the end of first year to the end of fifth year from
the date of allotment.
Preference share holders are entitled to get dividend only when the
company has distributable profits.
In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
3. 15%, Non Cumulative Redeemable Preference Shares.
Each Non Cumulative Redeemable Preference Share shall be redeemable
with in a period of 1 to 8 years from the date of issue i.e. 05/05/2014
as may be determined by the Board of Directors of the company at their
absolute discretion.
Preference share holders are entitled to get dividend only when the
company has distributable profits.
In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
Figures as at Figures as at
Particulars 31st March, 31st March,
2015 (Rs.) 2014 (Rs.)
4. CONTINGENT LIABILITIES
1. Counter guarantee issued in 15,000,000 11,900,000
favour of the banker for
guarantee given by them to
NSE for margin requirement
Rs. 29.80 Mn. (P.Y. Rs. 29.80 Mn)
and to BSE Rs. (Rs. P.Y. 0.2
Mn) for Margin requirment
2. Guarentee given on behalf of 5,000,000 30,000,000
subsidiary company Vertex
Commodities & Finpro (P)
Limited
3. Claims against the company
not acknowledged as debts:-
a. Tax demand in respect of:-
Service Tax orders for
FY 2006-07 to 2009-10 622,000 622,000
20,622,000 42,522,000
5. RELATED PARTY DISCLOSURES
As per Accounting Standard (AS-18) on Related Party Disclosures issued
by the Institute of Chartered Accountants of India, the disclosure of
transactions with the related party as defined in the Accounting
Standard are given below:-
Name of the party Relation
Kumar Nair Chairman & Managing Director
Transwarranty Finance Holding Company
Limited
Vertex Commodities and Subsidiary Company
Finpro (P) Limited
Transwarranty Private Associated Company
Limited (Until 16/12/2013)
Transwarranty Advisors Associated Company
Private Limited
6. Sundry debtors include old outstanding debts amounting to Rs.
9,695,589/- (P.Y. Rs. 9,695,589) in respect of which Company has
initiated legal and other recovery actions, the proceedings of which
are in different stages of progress. No provision for doubtful debts
has been made in the accounts during the year since the management is
confident that the debts are good and recoverable.
7. In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
8. The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients' accounts only when the company receives a written request from
the clients and after confirming that they have enough credit / margin
in their account.
9. Lien has been marked in favour of Axis bank in respect of Bank
Deposits worth Rs. 15,000,000/- (P.Y Rs. 11,900,000/-) together with
accumulated interest thereon, against bank guarantees issued by them on
account of the Company. Lien has been marked in favour of BSE against
trading guarantee in respect of Bank Deposit worth Rs. 1,000,000/-
(P.Y. Rs. 1,000,000/-) together with accumulated interest thereon.
10. Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Company's primary business segment is share
broking. All other activities of the company revolve around the main
business.
As the company's business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
11. The management has evaluated the long term investments and confirms
that there exists no circumstances which warrants further provision on
account of permanent diminution in the value of investments.
12. No provision for dividend on Preference Shares and dividend tax
there on has been made in the financial statement in the absence of
distributable profits during the year.
a) The Company has vide resolution passed at the meeting of Board
of Directors dated 11th October, 2011 and 16th January,
2012 decided to demerge its Merchant Banking division into a new
company in the name and style of Transwarranty Capital Market Services
Private Limited
b) As per the requirement of the Clause 24(f) of the Listing Agreement,
company has made an application to the Bombay Stock Exchange Limited
(BSE) which is pending for approval.
c) Appointed date of the proposed scheme of demerger is January 1, 2012
also the current financials of the company includes the financials of
the Merchant Banking division.
13. The Company has revised depreciation rates on Fixed Assets
effective 1st April, 2014 in accordance with requirements of Schedule
II of Companies Act, 2013 ("the Act"). The remaining useful life of the
Fixed Assets has been revised by adopting standard useful life as per
new Companies Act 2013. The carrying amount of the Fixed Assets as on
1st April, 2014 is depreciated over the remaining useful life. As a
result of this changes :-
The depreciation charge for the year ended 31st March, 2015 is
higher by Rs. 11,24,024/-
There is a debit to retained earnings of Rs. 12,04,975/- Lakhs for
the Fixed Assets whose remaining life as on 1st April, 2014 is expired
in accordance with revised life as per Companies Act 2013.
14. Previous year figures have been re-grouped/reclassified/
re-arranged/recast wherever necessary to suit the current year's
classification.
Previous year figures are, unless otherwise stated, given in bracket.
Mar 31, 2014
1) Terms and rights attached to Shares
A) Equity Shares
1) The company has only one class of Equity share having a Par Value of
Rs.2/- each. Each holder of equity share is entitled for one vote per
share. The company declares and pays dividend in Indian rupees. The
dividend proposed by the Board of Directors is subject to approval by
the share holders in the ensuring Annual General Meeting.
2) In the event of liquidation of the company, the holder of equity
shares will be entitled to receive remaining assets of the company,
after distribution of all preferential amounts. The distribution will
be in proportion to the number of equity shares held by the
shareholders.
B) 0.5% Fully Convertible Preference Shares.
1) Each Fully Convertible Preference Share shall be compulsorily
converted into five equity share of Rs.2/- each fully paid up at par, at
any time from the end of first year to the end of fifth year from the
date of allotment.
2) Preference share holders are entitled to get dividend only when the
company has distributable profits.
3) In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
C) 15%, Non Cumulative Redeemable Preference Shares.
1) Each Non Cumulative Redeemable Preference Share shall be redeemable
with in a period of 1 to 3 year from the date of issue i.e. 19/05/2010
as may be determined by the Board of Directors of the company at their
absolute discretion.
2) Preference share holders are entitled to get dividend only when the
company has distributable profits.
3) In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
6) Employees Stock Option Scheme
a) The Vertex Employee Stock Option Plan 2010 has been approved by the
Board Of Directors of the company on 10th March, 2008.
b) The vesting period is over five years from the date of grant,
commencing after one year from the date of grant.
c) Exercise Period would commence one year from date of grant and will
expire on completion of five years from the date of vesting.
d) The options will be settled in equity shares of the company.
e) The company used the intrinsic value method to account for ESOPs.
g) Consequently, no compensation cost has been recognized by the
company in accordance with the Guidance Note on Accounting for Employee
Share-Based payments issued by the Institute of Chartered Accountants
of India.
i) Had fair value method been used, the compensation cost would have
been higher by Rs.14.55 Lakhs (Previous Year Rs.21.44 Lakhs). Loss after
tax would have been higher by Rs.113.61 Lakhs (Previous year Rs.21.44
Lakhs) and Basic EPS would have been Rs.(0.24 ) Per share (Previous Year
Rs.(0.42) Per share) and Diluted EPS would have been Rs.(0.15) (Previous
Year Rs.(0.25)).
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31st MARCH, 2014
(ALL AMOUNTS MENTIONED ARE IN RUPEES)
Particulars Figures as at Figures as at
31st March, 31st March,
2014 2013
NON-CURRENT LIABILITIES
4. LONG TERM BORROWINGS
A) SECURED Term Loans
From Banks:-
-Vehicle Loan from HDFC Bank - 74,228
(Secured by hypothecation of vehicle - Motor Car-Skoda)
NOTE: The loan from HDFC was taken for purchase of Skoda Car, during
the year 2010-11. The loan carried an interest rate @ 9.75% and is
repayable in 60 installment. The loan is against hypothecation of the
Car Purchased.
B) UNSECURED
a) Loans and Advances from Related Parties
Inter-Corporate Deposits - Holding 50,388,865 37,927,082
Company
Inter-Corporate Deposits - Others 5,195,196 -
b) Other Loans and Advances
- Security Deposit from Franchises 5,365,156 6,196,740
& Advances
60,949,217 44,198,050
5. OTHER LONG TERM LIABILITIES
a) Trade Payables
Amount due to Clients 3,120,001 1,710,189
b) Others
Other Creditors 610,842 769,608
3,730,843 2,479,797
CURRENT LIABILITIES
3. SHORT TERM BORROWINGS
A) FROM BANKS
SECURED
Overdraft Account - Catholic Syrian Bank - 5,929,010
(Secured Against Pledge / Lien of Fixed Deposit
Nil (P.Y Rs.7,969,985/-) including interest)
B) FROM OTHERS
UNSECURED
Inter Corporate Deposits 5,642,520 -
5,642,520 5,929,010
Particulars Figures as at Figures as at
31st March 31st March
2014 2013
4. CONTINGENT LIABILITIES
1. Counter guarantee issued in favour 11,900,000 17,000,000
of the banker for guarantee given
by them to
NSE for margin requirement
2. Guarentee given on behalf of 30,000,000 10,000,000
subsidiary company Vertex
Commodities & Finpro (P)
Limited
3. Claims against the company not acknowledged as debts:-
a. Tax demand in respect of which:- - 1,111,000
- Authority (Income Tax) for the
Assessment Year 2007-08
- Service Tax orders for FY 2006-07 622,000 622,000
to 2009-10
42,522,000 28,733,000
5. Sundry debtors include old outstanding debts amounting to Rs.
9,695,589/- (P.Y. Rs. 10,435,972) in respect of which Company has
initiated legal and other recovery actions, the proceedings of which
are in different stages of progress. No provision for doubtful debts
has been made in the accounts during the year since the management is
confident that the debts are good and recoverable.
6. In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
7. The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients'' accounts only when the company receives a written request from
the clients and after confirming that they have enough credit / margin
in their account.
8. Lien has been marked in favour of Axis bank in respect of Bank
Deposits worth Rs.11,900,000/- (P.Y Rs.8,500,000/-) together with
accumulated interest thereon, against bank guarantees issued by them on
account of the Company. Lien has been marked in favour of BSE against
trading guarantee in respect of Bank Deposit worth Rs.1,000,000/- (P.Y.
Rs.Nil) together with accumulated interest thereon.
9. Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Company''s primary business segment is share
broking. All other activities of the company revolve around the main
business. As the company''s business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
10. The management has evaluated the long term investments and confirms
that there exist no circumstances which warrant provision on account of
permanent diminution in the value of investments.
11. No provision for dividend on Preference Shares and dividend tax
there on has been made in the financial statement in the absence of
distributable profits during the year.
12. a) The Company has vide resolution passed at the meeting of Board
of Directors dated 11th October, 2011 and 16th January,
2012 decided to demerge its Merchant Banking division into a new
company in the name and style of Transwarranty Capital Market Services
Private Limited
b) As per the requirement of the Clause 24(f) of the Listing Agreement,
company has made an application to the Bombay Stock Exchange Limited
(BSE) which is pending for approval.
c) Appointed date of the proposed scheme of demerger is January 1, 2012
also the current financials of the company includes the financials of
the Merchant Banking division.
13. Previous year figures have been re-grouped/reclassified/re-arranged
/recast wherever necessary to suit the current year''s classification.
Previous year figures are unless otherwise stated given in bracket.
Mar 31, 2013
1. Sundry debtors include old outstanding debts amounting to f
10,435,972/- (Rs. 10,370,458) in respect of which Company has initiated
legal and other recovery actions, the proceedings of which are in
different stages of progress. No provision for doubtful debts has been
made in the accounts during the year since the management is confident
that the debts are good and recoverable.
2. In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
3. During the year the company has purchased and sold securities due
to trade mistakes and failure of delivery of shares by clients. The
profit or loss thus incurred along with other mistakes due to
operational and communication problems are recognised under the head
Operating Expenses as Error Rectification.
4. The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients'' accounts only when the company receives a written request from
the clients and after confirming that they have enough credit / margin
in their account.
5. Lien has been marked in favour of Axis bank in respect of Bank
Deposits worth Rs. 8.5 Million (P.Y Rs. 5 Million) and in favour of HDFC
Bank Rs. Nil (P.Y. Rs. 8.25 million) together with accumulated interest
thereon, against bank guarantees issued by them on account of the
Company.
6. Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Company''s primary business segment is share
broking. All other activities of the company revolve around the main
business. As the company''s business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
7. The management has evaluated the long term investments and
confirms that there exist no circumstances which warrant provision on
account of permanent diminution in the value of investments.
8. No provision for dividend on Preference Shares and dividend tax
there on has been made in the financial statement in the absence of
distributable profits during the year.
9. a) The Company has vide resolution passed at the meeting of Board
of Directors dated 11th October, 2011 and 16th January, 2012 decided to
demerge its Merchant Banking division into a new company in the name
and style of Transwarranty Capital Market Services Private Limited.
b) As per the requirement of the Clause 24(f) of the Listing Agreement,
company has made an application to the Bombay Stock Exchange Limited
(BSE) which is pending for approval.
c) Appointed date of the proposed scheme of demerger is January 1, 2012
also the current financials of the company includes the financials of
the Merchant Banking division.
10. Previous year figures have been
re-grouped/reclassified/re-arranged/recast wherever necessary to suit
the current year''s classification. Previous year figures are unless
otherwise stated given in bracket.
Mar 31, 2012
1) Terms and rights attached to Shares.
A) Equity Shares.
1) The company has only one class of Equity share having a Par Value of
Rs 2/- each. Each holder of equity share is entitled for one vote per
share. The company declares and pays dividend in Indian rupees. The
dividend proposed by the Board of Directors is subject to approval by
the share holders in the ensuring Annual General Meeting.
2) In the event of liquidation of the company, the holder of equity
shares will be entitled to receive remaining assets of the company,
after distribution of all preferential amounts. The distribution will
be in proportion to the number of equity shares held by the
shareholders.
B) 0.5% Fully Convertible Preference Shares.
1) Each Fully Convertible Preference Share shall be compulsorily
converted into five equity share of Rs 2/- each fully paid up at par, at
any time from the end of first year to the end of fifth year from the
date of allotment.
2) Preference share holders are entitled to get dividend only when the
company has distributable profits.
3) In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
C) 15%, Non Cumulative Redeemable Preference Shares.
1) Each Fully Convertible Preference Share shall be redeemable with in
a period of 1 to 3 year from the date of issue i.e. 19/05/2010
2) Preference share holders are entitled to get dividend only when the
company has distributable profits.
3) In the event of winding up or repayment of capital, Preference share
holders have the preferential right to be repaid the amount of capital
paid up.
As per records of the company, including its register of share holders/
members and other declarations received from the shareholders regarding
beneficial interest, the above represents both legal and beneficial
ownership of shares.
The Company had issued and allotted 376,730 equity shares of Rs 2/- each
on 16-01-2012, pursuant to Chapter VII of SEBI (Issue of Capital and
Disclosure Requirements) Regulation, 2010 (ICDR) . Although the listing
approval from BSE is received on 09-05- 2012 the above shares have been
included in the above shareholding pattern.
1) Employees Stock Option Scheme
a) The "Vertex Employee Stock Option Plan 2010" has been approved bv
the Board Of Directors of the company on 10th March, 2008.
b) The vesting period is over five years from the date of grant,
commencing after one year from the date of grant.
c) Exercise Period would commence one year from date of grant and will
expire on completion of five years from the date of vesting.
d) The options will be settled in equity shares of the company.
e) The company used the intrinsic value method to account for ESOPs.
i) Had fair value method been used , the compensation cost would have
been higher by Rs 75.77 Lakhs (Previous Year Rs 89.37 Lakhs Loss after
tax would have been higher by Rs 75.77 Lakhs (Previous year Rs 89.37
Lakhs) and Basic EPS would have been Rs (0.43) Per share (Previous Year
Rs (1.92 ) Per share) and Diluted EPS would have been Rs (0.25) (Previous
Year Rs (0.80)).
Particulars For the
year ended For the
year ended
31st March,
2012 31st March
2011
2 CONTINGENT LIABILITIES
1. Counter guarantee issued in
favour of the banker for guarantee
given by them to NSE for margin
requirement 36,500,000 34,000,000
2. Guarantee given on behalf of
subsidiary company Vertex Commodities
& Finpro (P) Limited 50,000.000 60,000,000
3. Claims against the company not
acknowledged as debts:-
a. Tax demand in respect of which:-
- Company's Appeal is pending before
the first appellate Authority (Income
Tax) for the Assessment Year 2007-08 1,111,000 1,111,000
- Service Tax orders for FY 2006-07
to 2009-10 622,000 497,000
88,233,000 95,608,000
3 Sundry debtors include old outstanding debts amounting to Rs
10,370,458 (Rs 11,790,892) in respect of which Company has initiated
legal and other recovery actions, the proceedings of which are in
different stages of progress. No provision for doubtful debts has been
made in the accounts during the year since the management is confident
that the debts are good and recoverable.
4 In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
5 During the year the company has purchased and sold securities due to
trade mistakes and failure of delivery of shares by clients. The
profit or loss thus incurred along with other mistakes due to
operational and communication problems are recognised under the head
Operating Expenses as Error Rectification.
6 The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients' accounts only when the company receives a written request from
the clients and after confirming that they have enough credit / margin
in their account.
7 Lien has been marked in favour of ICICI Bank Ltd in respect of Bank
Deposits worth Rs Nil (P.Y Rs 3.80 Million) and in favour of HDFC Bank t
8.25 million (P.Y. Rs 13.25) and in favour of Axis bank Rs 5 Million (
P.Y. Rs Nil) together with accumulated interest thereon, against bank
guarantees issued by them on account of the Company.
8 Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Company's primary business segment is share
broking. All other activities of the company revolve around the main
business. As the company's business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
9 The management has evaluated the long term investments and confirms
that there exist no circumstances which warrant provision on account of
permanent diminution in the value of investments.
10 No provision for dividend on Preference Shares and dividend tax
there on has been made in the financial statement in the absence of
distributable profits during the year.
11 a) The Company has vide resolution passed at the meeting of Board of
Directors dated 11th October, 2011 and 16th January, 2012 decided to
demerge its Merchant Banking division into a new company in the name
and style of Transwarranty Capital Market Services Private Limited
b) As per the requirement of the Clause 24(f) of the Listing Agreement,
company has made an application to the Bombay Stock Exchange Limited
(BSE) which is pending for approval.
c) Appointed date of the proposed scheme of demerger is January 1, 2012
also the currert financials of the company includes the financials of
the Merchant Banking division.
12 Previous year figures have been re-grouped / reclassified /
re-arranged / recast wherever necessary to suit the current year's
classification. Previous year figures are unless otherwise stated given
in bracket.
Mar 31, 2011
1. Some of the debtors, advances, creditors, and security deposit are
subject to confirmation, reconciliation and adjustments if any. The
management does not expect any material difference affecting the
current years financial statements.
2. Sundry debtors include old outstanding debts amounting to
Rs.11,790,892 (Rs.6,735,421) in respect of which Company has initiated
legal and other recovery actions, the proceedings of which are in
different stages of progress. No provision for doubtful debts has been
made in the accounts during the year since the management is confident
that the debts are good and recoverable.
3. In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
4. During the year the company has purchased and sold securities due
to trade mistakes and failure of delivery of shares by client,. The
profit or loss thus incurred along with other mistakes due to
operational and communication problems are recognised under the head
Operating Expenses as Error Rectification.
5. The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients accounts only when the company receives a written request from
the clients and after confirming that they have enouga credit / margin
in their account.
6. Lien has been marked in favour of ICICI Bank Ltd in respect of Bank
Deposits worth Rs. 3.80 million (P.Y Rs. 20 million) and i n favour of
HDFC Bank Rs. 13.25 million (P.Y. Rs. Nil) together with accumulated
interest thereon, against bank guarantees issued by them on account of
the Company.
7. Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Companys primary business segment is share
broking. All other activities of the company revolve around the main
business. As the companys business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
8. Contingent Liabilities not provided for:
(Rs. In Lakhs)
As at As at
31.03.2011 31.03.2010
Rs. Rs.
Particulars
i) Counter guarantee issued in favour of
bankers for guarantee given by 340 410
them to NSE for margin requirements
ii) Guarantee given on behalf of subsidiary
company Vertex Commodities 600 Nil
& Finpro (P) Limited.
iii) Claims against the company not
acknowledged as debt
a) Tax demand in respect of which:
i Companys appeal is pending before the
first appellate Authority 11.11 11.11
(Income Tax) for the Assessment Year 2007-08
ii) Companys Service Tax appeal is pending
before the CESTAT 4.97 4.97
b) Arbitration against the company
pending in courts Nil 13.70
13. Information on related party transaction as required by Accounting
Standard -18
(a) Name of the related parties and description of the relation:
Name of the Party Relation
Transwarranty Finance Limited Holding Company
Kumar Nair Chairman & Managing Director
Vertex Commodities &
Finpro Private Limited. Subsidiary Company
Transwarranty Private Limited. Associated Company
Transwarranty Advisors
Private Limited. Associated Company
Ashok Mittal Chief Executive Officer
9. The management has evaluated the long term investments and
confirms that there exist no circumstances which warrant provision on
account of permanent diminution in the value of investments.
10. Employe Stock Option Scheme
a) The "Vertex Employe Stock Option Plan,2010" has been approved by the
Board Of Directors of the company on 10th March. 2008.
b) The vesting period is over five years from the date of grant,
commencing after one year from the date of grant.
c) Exercise Period would commence one year from date of grant and will
expire on completion of five years from the date of vesting.
d) The options will be settled in equity shares of the company.
e) The company used the intrinsic value method to account for ESOPs.
g) Consequently, no compensation cost has been recognized by the
company in accordance with the "Guidance Note on Accounting for
Employee Share-Based payments" issued by the Institute of Chartered
Accountants of India.
i) Had fair value method been used, the compensation cost would have
been higher by Rs.89.37 Lakhs (Previous Year Rs Nil) Loss after tax
would have been higher by Rs.89.37 Lakhs (Previous year Rs.Nil) and EPS
basic would have been Rs (1 92 ) Per share (Previous Year Rs.Nil )Per
share and Diluted EPS would have been Rs.(0.80) Per share (Previous
Year Rs Nil)
11. For the 27,758, 15% Non Cumulative Redeemable Preference shares of
Rs.100/- each and 8,300,715, 0.5% fully convertible preference shares
of Rs.10 each, no provision for dividend and dividend tax has been made
in the financial statement in the absence of distributable profits
during the year.
12. Previous year figures have been re-grouped/reclassified/
re-arranged/recast wherever necessary to suit the current years
classification. Previous year figures are unless otherwise stated given
in bracket.
Mar 31, 2010
1. Amalgamation with M/s. Transwarranty Capital Private Ltd.
The Company had entered into a Scheme of Amalgamation(Scheme) with M/s.
Transwarranty Capital Private Ltd. (TCPL) for the amalgamation of TCPL
with the Company effective April 1, 2009 (Appointed date). The Scheme
was approved by the Honourable High Court of judicature at Bombay on
18.12.2009 and Honourable High Court of judicature at Kerala on 23
.02.2010.
Pursuant to the order of the Honourable High Courts, TCPL has been
amalgamated with the Company and stands dissolved without being wound
up.
The Assets and Liabilities of erstwhile TCPL who is engaged in the
business of shares, derivatives, stock broking, depository services,
merchant banking and distribution of Mutual funds, were transferred and
vested in the Company w.e.f. the appointed date viz: 1st April, 2009 in
accordance with the Scheme sanctioned by the High Courts. The Scheme
has accordingly been given effect to in the accounts. Hence the
accounts of the current year are not comparable with that of the
previous year.
The amalgamation has been accounted for under the "The Purchase Method"
as prescribed by Accounting Standard (AS-14: Accounting for
Amalgamation) subject to the specific accounting treatment sanctioned
by the High Courts. Accordingly the assets and liabilities of erstwhile
TCPL as on 1st April 2009 has been taken over at their book values. The
accumulated losses (Rs.78.95 Lakhs) of TCPL is deemed as loss of the
Company. Further, 820,950 equity shares of Rs.10 each fully paid up and
8,300,715, 0.5% fully convertible preference shares of Rs.10/- each
fully paid up was issued to the equity share holders of the erstwhile
TCPL in exchange of 9,121,665 equity shares of Rs.10/- each fully paid
up held by them in erstwhile TCPL. Further 31,500 equity shares of
Rs.10/- each fully paid up and 318,500 0.5% fully convertible
preference shares of RslO/- each fully paid up are pending to be issued
to the equity share holders of the erst while TCPL in exchange of
350,000 equity shares of Rs 10/- each fully paid up held by them in
erst while TCPL since approval from Department of Industrial Policy and
Promotion is pending, the amount has been disclosed under "Share
Capital Suspense Account" in schedule 1-A as of 31st March 2010.
The preference share holders of the erstwhile TCPL was issued 27,758, 5
year 15 % non cumulative redeemable preference shares of Rs.100/- each
credited as fully paid up in exchange of equivalent number of 15% non
cumulative redeemable preference shares held by them in TCPL.
The Company is providing depreciation on straight-line method at the
rates prescribed in Schedule XIV to the Companys Act, 1956 where as,
the erstwhile TCPL was providing depreciation on written down value
method at the rates prescribed in Schedule XIV to the Companys Act
1956. In order to align with the accounting policy followed by the
Company, depreciation on assets of the erstwhile TCPL till the
amalgamation where recomputed under straight-line method at the rates
prescribed in Schedule XIV to the Companys Act 1956 and a sum of
Rs.1,100,569 is added along with the free reserves of the Company. The
difference of Rs. 60.78 lakhs between the value of shares to be issued
over the value of net assets taken over and loss adjusted is included
under Reserves and Surplus as Reserve on Amalgamation Account.
As per The Purchase Method prescribed in AS-14, Accounting for
Amalgamation, accumulated losses cannot be taken over by the Company.
However as per Scheme approved by High Courts accumulated losses will
be deemed to be loss of the Company Had the accounting treatment
prescribed under the Purchase method in AS-14, Accounting for
Amalgamation been followed there would be a goodwill of Rs.1,816,948/-
as against present Reserve on Amalgamation Account amounting to
Rs.6,078,890/-.
Final orders on the application to the SEBI for approval in connection
with the amalgamation of TCPL with the Company is pending as on date.
4. Foreign Exchange Transaction:
Earnings in foreign currency - Nil Nil
Expenditure in foreign currency - Nil Nil,
5. Some of the debtors, advances, creditors, and security deposit are
subject to confirmation, reconciliation and adjustments if any 1 he
management does not expect any material difference affecting the
current years financial statements.
6. Sundry debtors include old outstanding debts amounting to
Rs.67,35,421.19 (P.Y. Rs.67,62,691.79) in respect of which Company has
initiated legal and other recovery actions, the proceedings of which
are in different stages of progress. No provision for doubtful debts
has been made in the accounts during the year since the management is
confident that the debts are good and recoverable. ð
7. In the opinion of Directors, the current assets and deposits have
the value as stated in the Balance Sheet, if realized in the ordinary
course of business.
8. During the year the company has purchased and sold securities due to
trade mistakes and failure of delivery of shares by clients The profit
or loss thus incurred along with other mistakes due to operational and
communication problems are recognised under the head Operating Expenses
as Error Rectification.
9. The company is maintaining DEMAT beneficiary account with own
Depository Services. The stock is transferred to the respective
clients accounts only when the company receives a written request from
the clients and after confirming that they have enough credit / margin
in their account.
10. Lien has been marked in favour of ICICI Bank Ltd in respect of
Bank Deposits worth Rs.200 Lakhs (P.Y. Rs. 200 Lakhs) and in favour of
Federal Bank for Rs.5 lakhs (P.Y. Nil) together with accumulated
interest thereon, against bank guarantees issued by them on account of
the Company.
11. Based on the guiding principles given in Accounting Standard on
"Segment Reporting" (AS - 17) issued by the Institute of Chartered
Accountants of India, the Companys primary business segment is share
broking. All other activities of the company revolve around the main
business. As the companys business activity falls within a single
primary business segment, the disclosure requirements of AS - 17 in
this regard are not applicable.
12. Contingent Liabilities not provided for:
(Rs. In Lakhs)
Particulars As at As at
31.03.2010 31.03.2009
Rs. Rs.
i) Counter guarantee issued
in favour of bankers for
guarantee given by 410 400
them to NSE for margin
requirements
ii) Guarantee given on behalf
of subsidiary company Vertex
Commodities Nil 100
& Finpro (P) Ltd.
iii) Claims against the
company not acknowledged as
debt
1. Tax demand in respect of
which:
a) Tax authorities appealed
before Income Tax Appellate
Tribunal Nil 69.32
against the orders which were
ruled in favour of the company
by the First Appellate
Authority for the Assessment
years -2005-06
b) Companys appeal is pending
before the first appellate
Authority 11.11 Nil
(Income tax) for the
assessment year 2007-08
c) Companys Service Tax appeal
is pending before the CESTAT 4.97 Nil
2. Arbitration against the
Company pending in courts 13.70 10.04
13. Information on related party transaction as required by Accounting
Standard -18
(a) Name of the related parties and description of the relation:
Name of the Party Relation
Ranjan Verghese Managing. Director
Geetha Verghese Relative of the Managing Director
Transwarranty Finance Ltd Holding Company
Transwarranty Capital (P) Ltd Amalgamating Company (Previous year
Subsidiary to Holding Company)
Transwarranty Advisors(P) Ltd. Company controlled by Directors/
Relatives
Transwarranty Private Ltd. Company controlled by Directors/
Relatives
Kumar Nair Chairman
Vertex Commodities & Finpro
Private Ltd. Subsidiary Company
14. The management has evaluated the long term investments in Nawani
Corp (India) Limited and Cochin Stock Exchange Limited and confirms
that there exist no circumstances which warrant provision on account of
permanent diminution in the value of investments.
21. Previous year figures have been re-grouped/reclassified/re-arranged/
recast wherever necessary to suit the current years classification.
Previous year figures are unless otherwise stated given in bracket.
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