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Notes to Accounts of Vimta Labs Ltd.

Mar 31, 2015

I) Cash credit from State Bank of India (Limit) Rs. 9,00,00,000/- (previous year Rs. 13,00,00,000/-) carrying interest @ 3.75% above base rate for CC (Hyp.) and for EPC and FBD as applicable to export finance(i.e., 3 Months average LIBOR 150 basis points), is secured by First charge (hypothecation) of all the current assets of the Company on exclusive basis as primary security and collaterally secured by extension of charge on the fixed assets of the Company and structures thereon alongwith EM of Company's land under Plot No. 141/2 & 142 admeasuring 1.66 Ac. situated at IDA, Phase-II, Cherlapally, R.R. Dist. and land under Plot No.5, Alexandria Knowledge Park, Phase-I admeasuring 52620 sq. yards situated at Turkapally Village, Shameerpet Mandal, R.R. Dist.

ii) There are no defaults as on the Balance Sheet date in repayment of the above loan and interest thereon.

2.1 Related party disclosures (AS-18)

Names of the Key Management Personnel related parties, nature of relationships and particulars of transactions with the said related parties during the year are as follows :

i) Names of the related parties and description of relationship.

A) Key Management Personnel

Dr S P Vasireddi Executive Chairman

Harita Vasireddi Managing Director

V Harriman Executive Director - Operations

V V Prasad Executive Director - Administration

A Venkataramana Company Secretary

Sankaraiah Peram Chief Financial Officer

B) Relatives of Key Management Personnel

Swarnalatha Vasireddi Wife of Executive Chairman

Sireesh Chandra Vungal Son of ED - Operations

Sudheshna Vungal Daughter of ED - Operations

Satya Sreenivas Neerukonda Son-in-Law of ED - Administration

Rajeswari Vungal Wife of ED - Operations

Praveena Vasireddi Daughter of Executive Chairman

C) Other related parties Ananth Technologies Limited (Companies in which Bloomedha Info Solutions Limited some of the Directors or other relatives are interested)

Note : Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

ii) Aggregate Related Party transactions for the year 2013-14

Note : As the liability for Gratuity is provided on actuarial basis for all the employees of the company including whole-time directors as a whole, amount pertaining to the Key Management Personnel and their relatives is not ascertainable and therefore not included in the above.

2.2. Leases (AS-19) :

The Company has taken certain equipment under non canceleable operating lease agreements for a period of 36 months. The lease rental charge grouped under operating lease charges during the year ended March, 2015 is Rs. 627,828/- (Previous year Rs. 17,351,782/-) and maximum obligation on long- term non-cancelable operating lease payable as per the rentals stated in respective agreements are as follows :

Note : The Company's appeals against the orders of Commissioner of Service Tax , Hyderabad - III for the financial years 2005-06 to 2009-10 and 2010-11 before the CESTAT, South Zone Bench, Bangalore were disposed in favour of the Company.

3. Corporate Social Responsibility (CSR) : To comply with the Corporate Social Responsibility (CSR) requirements under the provisions of Section 135 (5) of the Companies Act, 2013 read with the Rules made, thereunder, the Company has determined the eligible amount at Rs. 4,67,236/- being the 2% of the average net profits of the Company in the three immediately preceding years. Against which, an amount of Rs. 4,04,000/- contributed during the year to Charitable Trust for carrying out the activities specified by the Board and charged the same to statement of P&L .

4. Previous year's figures have been regrouped / recasted wherever considered necessary to conform to the layout of the accounts adopted in the current year. Paise have been rounded off to the nearest rupee.


Mar 31, 2014

1. As at As at 31.03.2014 31.03.2013 Rs. Rs.

1) CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided for)

I) Contingent liabilities

a) Claims against the company not acknowledged as debt : i) Disputed service tax demand for the year 2005-06 to 2009-10 277,846,538 277,846,538

ii) Disputed service tax deducted for the year 2010-11 60,335,240 60,335,240

iii) Disputed Lease charges on equipment Nil 15,476,286

b) Guarantees issued by bank 1,36,58,296 12,594,172

II) Commitments b) Other Comitantes : a) Future minimum lease payments under operating lease 646,250 1,412,953

TOTAL 352,486,324 367,665,189

i) The Company has filed appeal and for stay of demand against the order of Commissioner of Service Tax, Hyderabad-III against the Service Tax demand of Rs.277,846,538/- (Service tax of Rs.138,923,269/- & penalty of Rs.138,923,269/-) for financial year 2005-06 to 2009-10 before the CESTAT, South Zonal Bench, Bangalore. The CESTAT has directed the company to pay an amount of Rs.20,000,000/- and granted stay for the balance demand. Accordingly, company has paid the same and the appeal is pending disposal. The legal counsel has confirmed the validity of the Company''s claim. Hence, the same is shown as a contingent liability.

ii) The Company has filed appeal and for stay of demand against the order of commissioner of Service Tax, Hyderabad - III against the Service Tax demand of Rs.60,335,240/- (Service tax of Rs.30,167,620/- and penalty of Rs.30,167,620/-) for financial year 2010-11 before the CESTAT, South Zonal Bench, Bangalore. On appeal, the CESTAT has stayed the demand and the appeal is pending disposal. The legal counsel has confirmed the validity of the Company''s claim. Hence, the same is shown as a contingent liability.


Mar 31, 2013

I) Cash credit from State Bank of India (Limit) Rs. 130,000,000/- (previous yearRs.. 110,000,000/-) carrying interest @ 7% above base rate for CC(Hyp.) and 2.75% above base rate for EPC and FBD, is secured by First charge (hypothecation) of all the current assets of the Company on exclusive basis as primary security and collaterally secured by extension of charge on the fixed assets of the Company and structures thereon along with EM of Company''s land under Plot No. 141/2 & 142 admeasuring 1.66 Ac. situated at IDA, Phase-ll, Cherlapally, R.R. Dist. and land under Plot No.5, Alexandria Knowledge Park, Phase-1 admeasuring 52620 sq. yards situated at Turkapally Village, Shameerpet Mandal, R.R. Dist.

ii) Working capital facility from HSBC Ltd (consisting of PCFC loan and Vendor Finance repayable in foreign currency and Indian Rupees respectively) carried interest @ LIBOR 3.67% and 14% per annum is secured by first pari passu charge on entire current assets of the company both present and future and second pari passu charge on movable fixed assets of the company both present and future.

iii) There are no defaults as on the Balance Sheet date in repayment ofthe above loans and interest thereon.

iv) Corporate Loan from State Bank of India carrying interest @7% above base rate, is secured by First charge on fixed assets of the company and structures thereon along with EM of company''s land under Plot No. 141/2 & 142 admeasuring 1.66 Ac. situated at IDA, Phase-ll, Cherlapally, R.R. Dist. and land under Plot No.5, Alexandria Knowledge Park, Phase-1 admeasuring 52620 sq. yards situated atTurkapally Village, Shameerpet Mandal, R.R. Dist. The loan is repayable in monthly installments of Rs..5,00,000/- each.

v) Term Loan from The Hongkong and Shanghai Banking Corporation Limited (HSBC Bank) repayable in foreign currency was secured by pari passu charge on entire movable and immovable fixed assets of the company, both present and future as primary security and extension of pari passu charge on entire current assets of the company both present and future. The loan amount was carrying interest of LIBOR 65 bps to 150 bps repayable in quarterly installments as per the sanctioned letter. The entire loan amount was repaid before the end of the year.

As at As at 31.03.2013 31.03.2012 Rs. Rs.

1) CONTINGENT LIABILITIES AND COMMITMENTS (to the extent not provided for)

1.1 Contingent liabilities

a) Claims against the company not acknowledged as debt:

i) Disputed service tax demand for the year 2005-06 to 2009-10 277,846,538 277,846,538 (See note (a) below)

ii) Disputed service tax deducted for the year 2010-11 60,335,240 - (See note (b) below)

iii) Disputed Lease charges on equipment 15,476,286 -

b) Guarantees issued by bank . 12,594,172 16,174,626

1.2 Commitments

a) Future minimum lease payments under operating lease 1,412,953 25,950,271

TOTAL 367,665,189 319,971,435

#The Company has filed an appeal and for stay of demand against the order of Commissioner of Service Tax, Hyderabad-Ill against the demand ofRs.. 277,846,538/-(Service tax ofRs.. 138,923,269/-and penalty ofRs.. 138,923,269/-) before the CESTAT, South Zonal Bench, Bangalore. The CESTAT has directed the company to pay an amount of Rs..20,000,000/- after hearing the stay of demand petition and company has paid Rs.. 20,000,000/-as per the above order. The appeal is pending for disposal. The legal counsel has confirmed the validity of the Company''s claim. Hence no provision is made for this liability.

The Company has filed an appeal against the order of commissioner of Service Tax, Hyderabad - III against the demand of Rs.. 60,335,240/- (Service tax ofRs.. 30,167,620/- and penalty ofRs.. 30,167,620/-) before the CESTAT, South Zonal Bench, Bangalore. The appeal is pending for disposal. The legal counsel has confirmed the validity of the Company''s claim. Hence no provision is made for this liability.


Mar 31, 2012

1) LONG-TERM BORROWINGS

i) Corporate Loan from State Bank of India was secured by hypothecation of equipment procured with the loan as primary security and extension of pari passu charge on other fixed assets of the Company, other than the assets which were acquired with Hire Purchase loans, Grants and Soft loans from Government and other institutions. The loan was also secured by second charge on current assets of the company on pari passu basis. The loan was carrying interest of 16.75% repayable in monthly installments of Rs. 5,00,000/- each.

ii) Term Loan from The Hongkong and Shanghai Banking Corporation Limited (HSBC Bank) repayable in foreign currency was secured by pari passu charge on entire movable and immovable fixed assets of the company, both present and future as primary security and extension of pari passu charge on entire current assets of the company both present and future. The loan amount was carrying interest of LIBOR plus 65 bps to 150 bps, repayable in quarterly installments as per the sanction letter.

Note: There are no continuing defaults as on the Balance sheet date in repayment of all the above loans and interest thereon.

2) SHORT TERM BORROWINGS

i) Cash credit from State Bank of India (limit) Rs. 110,000,000 (Previous Year Rs. 120,000,000) carried interest @ 16.75% and secured by hypothecation of all the current assets of the Company as primary security by way of pari passu charge and extension of parri passu charge on land, buildings and fixed assets of the company, other than the assets which are acquired with Hire Purchase loans, Soft loan from Technology Development Board and grants from Government and other Institutions.

ii) Working capital facility from HSBC Bank (consisting of PCFC loan and Vendor Finance repayable in foreign currency and Indian Rupees respectively) carried interest @ LIBOR plus 3.67% and 14% per annum is secured by first pari passu charge on entire current assets of the company both present and future and second pari passu charge on movable fixed assets of the company both present and future.

iii) There are no continuing defaults as on the Balance sheet date in repayment of the above loans and interest thereon.

3.1 Related party disclosures (AS-18)

Names of the related parties and nature of relationships and particulars of transactions with the said related parties during the year are as follows :

i) Names of the related parties and description of relationship.

A) Key Management Personnel

Dr S P Vasireddi Chairman & Managing Director

V Harriman Director-Technical

V V Prasad Executive Director

Harita Vasireddi Director-Quality

B) Relatives of Key Management Personnel

Swarnalatha Vasireddi Wife of Managing Director

Sireesh Chandra Vungal Son of Director Technical

Sujani Vasireddi Daughter of Executive Director

Satya Sreenivas Neerukonda Son-in-Law of Executive Director

Rajeswari Vungal Wife of Director Technical

C) Associates Vimta Specialities Limited

D) Other related parties Ananth Technologies Limited Bloomedha Info Solutions Limited

Note : Information of related parties and the relationship is as identified by the Company on the basis of information available with them and relied upon by the auditors.

4.1. Leases (AS-19) :

The Company has taken certain equipment under non canceleable operating lease agreements for a period of 36 months. The lease rental charge grouped under operating lease charges during the year ended March, 2012 is Rs. 2,02,02,764/- (Previous year Rs. 2,30,39,190/-) and maximum obligation on long-term non-cancelable operating lease payable as per the rentals stated in respective agreements are as follows:

 
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