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Notes to Accounts of Westlife Development Ltd.

Mar 31, 2014

1 CORPORATE INFORMATION

Westlife Development Limited is a public limited company incorporated under the Companies Act, 1956 and having its registered office at Mumbai. The Company has interests in trading and in quick service restaurant business through its subsidiaries.

1.1 BASIS OF PREPARATION

The financial statements of the Company have been prepared and presented in accordance with the generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on an accrual basis. 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 read with General Circular 8 / 2014 dated April 4, 2014, issued by the Ministry of Corporate Affairs in respect of Section 133 of The Companies Act, 2013. The accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

2 SEGMENT INFORMATION

The Company has considered Business Segments as the primary segment for disclosure. Business Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system.

Management has identified four reportable segments namely Trading, Leasing, Lending and Services.

Secondary Segment Information - Geographical Segments

Entire Business Activities being in India, hence there is only one geographical segment.

Trading

The Company is engaged in the business of trading of steel, textile and other materials.

Leasing

The Company provides office premises on operating lease basis.

Lending

The Company provides loan facility to its group companies and others.

Services

The Company is engaged in providing manpower services.

3 CONTINGENT LIABILITIES:

Contingent liabilities as at March 31, 2014 H Nil (Previous Year H Nil).

4 OPERATING LEASES:

a) Operating lease payments recognized in Statement of Profit and Loss is H4,886,400 (Previous Year H5,766,000).

b) Payments received for sub-leases recognized as Income in Statement of Profit and Loss is H5,040,000 (Previous Year H5,920,000).

c) General description of leasing arrangements:

(i) Leased Assets: Office premises taken on lease

(ii) At expiry of the lease term, the Company has an option either to return the asset or extend the term by renewing the contract.

(iii) There is no escalation clause in the lease agreement. There are no restrictions imposed by the lease arrangement.

5 COMPOSITE SCHEME OF ARRANGEMENT

a) Amalgamation of Westpoint Leisureparks Private Limited (WLPL)

Pursuant to the composite scheme of arrangement (''the scheme''), the erstwhile WLPL has been amalgamated with the Company under section 391 to 394 of the Companies Act, 1956 sanctioned by the Hon''ble High Court of Bombay on July 19, 2013 and the assets and liabilities of WLPL were transferred and vested in the Company with effect from October 1, 2012. Accordingly, the scheme has been given effect to in these financial statements.

The operations of WLPL include carrying out the business activities of promotion, development, setting up, management of investments in and operation of quick service restaurants, hotels, resorts, leasing of immovable properties, providing human resource, investing in shares and mutual fund units, trading in goods.

The amalgamation has been accounted for under the "pooling of interest" method as prescribed by Accounting Standard-14 "Accounting for amalgamation". Accordingly, the accounting treatment has been given as under

1) The assets, liabilities, reserves and debit balance in the Statement of Profit and Loss account of WLPL as at October 1, 2012 have been incorporated at their book values in the financial statements of the Company.

2) 1,30,395 Equity shares of Re 1 each fully paid up of WLPL stands cancelled. Further investment in 99,000 equity shares of WLPL held by the company stands cancelled and 28,994,852 equity shares of H2 each of the Company have been issued to the remaining shareholders of WLPL.

3) The excess amount of H57,958,564 of the book value of the investment in the equity share capital of WLPL and consideration given by the Company over the face value of the cancelled shares as referred in note 2 above has been debited in Capital Reserve account.

4) The profit of WLPL for the period October 1, 2012 to March 31, 2013 amounting to H395,564 has been added to surplus in Statement of Profit and Loss account.

b) Amalgamation of Triple A Foods Private Limited (TAF)

Pursuant to the composite scheme of arrangement (''the scheme"), the erstwhile TAF has been amalgamated with the Company under section 391 to 394 of the Companies Act, 1956 sanctioned by the Hon''ble High Court of Bombay on July 19, 2013 and the assets and liabilities of TAF were transferred to and vested in the Company with effect from October 1, 2012. Accordingly, the scheme has been given effect to in these financial statements.

The operations of TAF include carrying out the business activities of promotion, development, setting up, management of investments in and operation of quick service restaurants, hotels, resorts, leasing of immovable properties, providing human resource, investing in shares and mutual fund units, trading in goods.

The amalgamation has been accounted for under the "pooling of interest" method as prescribed by Accounting Standard -14 "Accounting for amalgamation". Accordingly, the accounting treatment has been given as under

1) The assets, liabilities, reserves and credit balance in the Statement of Profit and Loss of TAF as at October 1, 2012 have been incorporated at their book values in the financial statements of the Company.

2) 126,250 Equity shares of H1000 each fully paid up of TAF stands cancelled. Further investment in 101,000 equity shares of TAF held by WLPL stands cancelled and 29,704,100 equity shares of H2 each of the Company have been issued to the remaining shareholders of TAF.

3) The excess amount of H2,306,408,200 of the book value of the investment in the equity share capital of TAF and consideration given by the Company over the face value of the cancelled shares as referred in note 2 above has been debited in Capital Reserve account.

4) The profit of TAF for the period October 1, 2012 to March 31, 2013 amounting to H92,062 has been added to surplus in Statement of Profit and Loss account.

c) Demerger of Westlife Development Limited

Pursuant to the composite scheme of arrangement (''the scheme''), under section 391 to 394 of the Companies Act, 1956 sanctioned by the Hon''ble High Court of Bombay on July 19, 2013, the trading, lending and investment business (transferred business) is transferred to the resulting company "West Leisure Resorts Private Limited" (WLR) w.e.f. October 1,2012(appointed date). Accordingly the scheme has been given effect to in these financial statements.

1) All the assets and liabilities of the transferred business of the Company on the appointed date have been transferred to WLR.

2) Investment in 2,666,670 equity shares of WLR of H10 each fully paid up held by the Company stands cancelled and the excess of assets over liabilities relating to the transferred business amounting to H157,578,402 transferred to WLR, have been debited to the Capital Reserve account.

3) The profit of transferred business for the period October 1, 2012 to March 31, 2013 amounting to H20,898,628 has been adjusted in "surplus/(deficit) in statement of profit and loss" and transferred to WLR.

6 There are no Micro, Small & Medium Enterprises as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues. This information has been determined on the basis of information available with the Company.

The options were not exercised during the year, hence the weighted average share price on the date of exercise is not mentioned (Previous year: not applicable)

The Company has granted options to the employees of its subsidiary company and the related expenses are recovered from the subsidiary company. Thus the cost included in the Statement of Profit and Loss account of the Company is nil.

e) The weighted average fair value of stock options granted during the year was H278.11 (previous year not applicable). The Black Scholes valuation model has been used for computing the weighted average fair value considering the following inputs:

7 The profit for the year is comparatively lower than the last year mainly on account of one time amalgamation costs such as stamp duty etc. (refer note 20) debited in the Statement in the Profit and Loss account. This has resulted into negative earnings before depreciation and tax.

8 Promoter Group : Mr. Banwari Lal Jatia is the promoter of the Company. The persons constituting the promoter group include individuals, HUF and corporate entities. The names of these persons are:

Achal Exim Private Limited, Akshay Ayush Impex Private Limited, Acacia Impex Private Limited, Anand Veena Twisters Private Limited, Concept Highland Business Private Limited, Hardcastle & Waud Mfg Co. Limited, Hardcastle Petrofer Private Limited, Hawcoplast Investments & Trading Limited, Horizon Impex Private Limited, Houghton Hardcastle (India) Limited, Hawco Lubricants Limited, Saubhagya Impex Private Limited, Shri Ambika Trading Co. Private Limited, Subh Ashish Exim Private Limited, Vandeep Tradelinks Private Limited, Vishwas Investment & Trading Co. Private Limited, Winmore Leasing & Holdings Limited, West Pioneer (India) Private Limited, West Leisure Resorts Limited, Amit BL Properties Private Limited, Ridhhika Properties Private Limited, Hardcastle Restaturants Private Limited, Makino Holdings Limited, J K Speciality Chemicals LLP, Hawco Petrofer LLP, Smt. Lalita Devi Jatia, Smt. Usha Devi Jatia, Shri. Amit Jatia, Smt. Smita Jatia, Shri. Akshay Jatia, Shri. Ayush Jatia, Shri. Anurag Jatia, Smt. Shalini Jatia, Miss Ridhika Jatia, Banwarilal Jatia – HUF, Amit Jatia – HUF and Anurag Jatia - HUF.

9 Previous year''s figures have been regrouped /reclassified wherever necessary to make them comparable with current year''s figures.


Mar 31, 2013

1. CORPORATE INFORMATION

Westlife Development Limited is a public limited company incorporated under the Companies Act, 1956 and having its registered office at Mumbai. Its shares are listed on the Bombay Stock Exchange. The Company has interests in trading and in quick service restaurant business through its subsidiaries.

2 Basis of Preparation

The financial statements of the Company have been prepared and presented in accordance with the generally accepted accounting principles in India (Indian GAAP) under the historical cost convention on an accrual basis. 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 accounting policies have been consistently applied by the Company and are consistent with those used in the previous year.

3. SEGMENT INFORMATION

The Company has disclosed Business Segment as the primary segment. Segments have been identified taking into account the nature of the products, the differing risks and returns, the organisation structure and internal reporting system.

Management has identified four reportable segments namely Trading, Leasing, Lending and Job Contracts,

4. CONTINGENT LIABILITIES

Contingent liabilities as at March 31 2013 Rs. Nil (Previous Year Rs. Nil).

5. OPERATING LEASES:

a) Operating lease payments recognised in Statement of Profit and Loss is Rs. 57,66,000 (Previous Year Rs. 64,86,000).

b) Payments received for sub-leases recognised as Income in Statement of Profit and Loss is Rs. 59,20,000 (Previous Year Rs. 66,60,000).

c) General description of leasing arrangements:

(i) Leased Assets: Office premises taken on lease

(ii) At expiry of the lease term, the Company has an option either to return the asset or extend the term by renewing the contract.

(iii) There is no escalation clause in the lease agreement. There are no restrictions imposed by the lease arrangement.

6. PROPOSED SCHEME OF ARRANGEMENT AND AMALGAMATION

The Board of Directors at its meeting held on December 12 2012 approved a Composite Scheme of Arrangement for amalgamation of Westpoint Leisure Parks Private Limited and Triple A Foods Private Limited with the Company and to spin off a part the of the Company''s business to West Leisure Resorts Private Limited.

In terms of the Scheme, the appointed date is 01 October 2012. The Scheme has been filed with the High Court of Bombay and is pending approval of the Court.

In view of the pendency, no effect of the Scheme has been recognised in the financial statements.

7. During the previous year, the Company had written off project expenditure aggregating to Rs. 1,27,43,861 relating to exploration of new business opportunities on account of non viability of the projects.

8. The Company has not recognised liability for Rs. 23,836,822 towards premium payable on redemption of preference shares, as the Management is of the view that in future there will be sufficient securities premium amount available with the Company to pay the premium payable on redemption of the preference shares.

9. There are no Micro, Small & Medium Enterprises as defined in the Micro, Small and Medium Enterprises Development Act, 2006 to whom the Company owes dues. This information has been determined on the basis of information available with the Company.

10. Promoter Group : Mr. Banwari Lai Jatia is the promoter of the Company. The persons constituting the promoter group include individuals, HUF and corporate entities. The names of these persons are:

Achal Exim Private Limited, Akshay Ayush Impex Private Limited, Acacia Impex Private Limited, Anand Veena Twisters Private Limited, Concept Highland Business Private Limited, Hardcastle & Waud Mfg Co. Limited, Hardcastle Petrofer Private Limited, Hawcoplast Investments & Trading Limited, Horizon Impex Private Limited, Houghton Hardcastle (India) Limited, Hawco Lubricants Limited, Saubhagya Impex Private Limited, Shri Ambika Trading Co. Private Limited, Subh Ashish Exim Private Limited, Triple A Foods Private Limited, Vandeep Tradelinks Private Limited, Vishwas Investment & Trading Co. Private Limited, Winmore Leasing & Holdings Limited, West Leisure Resorts Private Limited, Westpoint Leisureparks Private Limited, Hardcastle Restaturants Private Limited, Smt Lalita Devi Jatia, Smt Usha Devi Jatia, Shri Amit Jatia, Smt Smita Jatia, Shri Akshay Jatia, Shri Ayush Jatia, Shri Anurag Jatia, Smt Shalini Jatia, Miss Ridhika Jatia, Banwarilal Jatia - HUF, Amit Jatia - HUF and Anurag Jatia - HUF.

11. Figures of previous year were audited by a firm of chartered accountants other than S.R. Batliboi & Co. LLP.

12. Previous year''s figures have been regrouped /restated wherever necessary to make them comparable with current year''s figures.


Mar 31, 2011

1) In the opinion of the Board, Current Assets, Loans & Advances have a value on realization in the ordinary course of business at least equal to the amounts at which they are stated. Provision for all known liabilities has been made,

2) Since the Compony employs very few persons, the accrued liability in respect of shart-term compensated absences has been calculated by employing a method based on the assumption that such benefits are payable to the employees at the end of the accounting year, As for post-employment benefits the Company is not covered under the Payment of Grotuity Act, 1972 and the Employees' Provident Funds and Miscellanious Provisions Act, 1952.

However, in view of contractual obligations provision for gratuity liability has been made on the assumption that the benefit thereof is payable at the end of the accounting year.

3) To the best of knowledge of the Compony, none of its creditors is a "Small Enterprise" within its meaning under clouse (m) of Section 2 of the Micro.Small & Medium Enterprises Development Act, 2006 and therefore principal amount, interest paid / payable or accrued to such enterprises is NIL.

4) Related party disclosure : (As identified by the management and relied by the auditors)

i) Control : Mr. B.L. Jatia (Promoter)

ii) Subsidiary Companies : West Leisure Resorts Pvt Ltd West Point Leisureparks Pvt Ltd

5) Income tax demand of Rs. 1.51 Lacs for Assessment Year 2007-08 has not been provided for as Company's appeal against the same is pending before the Appellate Authoryity.

NOTE:

Secondary segment Information - Geographical segments Business Activities are only in India, hence there are no reportable Geographical Segments.

6) The Company has granted unsecured loan carrying 0% Interest during the year to West Leisure Resorts Pvt Ltd, its wholly - owned subsidiary. The year-end balance of the loan was Rs 7,87,80,000 (maximum during the year Rs. 14,11,30,000). There is no repayment schedule for the loan. Two of the Company's directors are interested therein being also directors in the loanee company.

7) The Company granted unsecured loon carrying 0% interest during the year to Westpoint Leisureparks Pvt Ltd, its subsidiary, The year-end bolance of the loan was NIL (maximum during the year Rs 4,66,00,000). Two of the Company's directors are interested therein being also directors in the loanee company.

8) There are no shares in unclaimed suspense account.

9) Promoter Group : Mr B L Jatia is the promoter of the Company. The persons constituting the promoter group include individuals, HUF and corporate entities. The names of these persons are:

Mr B.L. Jatia, Achal Exim Pvt, Ltd, Akshay Ayush Impex Pvt, Ltd, Acacia Impex Pvt. Ltd, Anand Veena Twisters Pvt, Ltd, Concept Highland Business Pvt. Ltd, Hordcostle 4 Waud Mfg Co. Ltd, Hardcastle Petrofer Pvt. Ltd, Hawcoplost Investments & Trading Ltd, Horizon Impex Pvt. Ltd, Houghton Hardcastle (India) Ltd, Howca Lubricants Ltd, Saubhagya Impex Pvt. Ltd, Shri Ambika Trading Co. Pvt. Ltd, Subh Ashish Exim Pvt. Ltd, Triple A Foods Pvt. Ltd, Vandeep Tradelinks Pvt. Ltd, Vishwas Investment A Trading Co, Pvt, Ltd, Winmore Leasing A Holdings Ltd,West Leisure Resorts Pvt, Ltd., Westpoint Leisureparks Pvt. Ltd., Hordcostle Restaturonts Pvt, Ltd, Smt Lalita Devi Jatia, Shri B.L.Jatia, Smt Usha Devi Jatia, Shri Amit Jatia, Smt Smita Jatia, Shri Akshay Jotia, Shri Ayush Jatia, Shri Anurag Jatia, Smt Shalini Jatio, Miss Ridhika Jatia, Banwarilal Jatia - HUF, Amit Jatia - HUF and Anurag Jatia - HUF.

 
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