Mar 31, 2015
NOTE 1
The company has only one class of shares referred to as equity shares
having a par value of Rs 10/- each.
Each holder of the equity share, as reflected in the records of the
company as of the date of the shareholders meeting, is entitled to one
vote in respect of each share held for all matters submitted to vote in
the shareholders meeting.
NOTE 2
Disclosure of shares held by its holding company
11060000 ( Pr. Year 11060000) Equity Shares fully paid up of Rs.1106
lakhs (Pr. Year Rs. 1106 lakhs ) are held by M/s Hindustan Organics
Chemicals Limited, the holding company.
3. The Term loan from HOCL is secured by part of the land to the
extent of 62 acres of the Factory & Plant and Buildings at Rudraram
Village.
4. The Term loan from HOCL of Rs. 2744.06 lakhs is Zero coupon loan
as per terms of the BIFR agreement and is repayable in seven equal
annual installments as per the loan agreement commencing from F Y
2010-11. The installment due for F Y 2010-11 , 2011-12 , 2012-13,
2013-14, 2014-15 amounting to Rs.1960.04 lacs is not paid by the
company and current maturities of F Y 2015-16 amounting to Rs.392.01
lacs are shown in Note - 8 under the head ' Other Current liabilities'
being current maturities of long term debt.
5. The Term loan from HOCL of Rs.756.42 lakhs is Interest bearing @
10.25% to 14.50% repayable in 5 annual installments commencing from F Y
2010-11 as per the loan agreement. The company is continuing default in
payment of all the installments due and interest during the F Y 2010-11
to 2014-15 amounting to Rs.456.43 lacs is not paid by the company &
shown in Note -8 of the financial statements under the head 'Other
Current liabilities' being current maturities of long term debt and
interest due amounting to Rs.616.23 lakhs under Interest accrued and
due.
6. Term loan of Rs. 5.00 Crore @14.20% p.a. (floating) for
refurbishment of PTFE plant and setting up Modified PTFE plant
repayable in 5 years 3 months including moratorium period of 9 months
after the completion of the project commencing from April, 2015. The
company hypothecated land of 60.285 acres and plant and machinery as
collateral security besides furnishing of corporate guarantee by
promoter company Viz., HOCL to this extent. Further, HOCL has given an
undertaking that they will not withdraw their investments during the
period of loan.
7. The company has received plan loan from government of India Rs.
3,60,00,000/-for manufacture of MPTFE on 22.8.2014 and Rs.
13,20,00,000/- for refurbishment of the Plant and HFP and FEP related
items on 01.01.2015 @11.5% p.a. repayable in 5 annual installments
commencing from F.Y. 2015-16. The 1st installment due for F.Y. 2015-16
amounting to Rs. 336.00 lakhs shown in Note-8 under the head 'Other
Current liabilities being Govt. Plan Loan current maturities of long
term debt'.
8. Secured by hypothecation of the company's entire stock of raw
materials, finished goods, stock in process, consumables, stores &
spares and book debts, plant and machinery and part of the land to the
extent of Acres 60.285 out of the total land of Acres126.13 at Rudraram
Village and guaranteed by the holding company, viz. Hindustan Organic
Chemicals Ltd. The cash credit is repayable on demand and carries
interest @14.2% p.a.
9. Margin money deposits are subject to first charge/ lien to
secure the company's cash credit loan and term loan with a maturity
period of 6 to 12 months. 15(B). The company has made a deposit with
SBH (Corporate Liquid Term Deposit) for a maturity period of 1 year.
10. Balance standing to the debit/credit of parties is subject to
confirmation by them and review by the Company. 14(B) Debts overdue
for a period exceeding six months includes towards case filed in High
Court of Andhra Pradesh, which is pending amounting to Rs.129.16 Lacs
(Previous year Rs.129.16 Lacs)
11. Both employer and employees make monthly contributions of 10%
instead of 12% as per BIFR scheme to a separately managed exempted EPF
Trust.
12. As per Accounting Standard 15 "Employee benefits", the
disclosures as defined in the Accounting Standard are given below:
The Company's Provident Fund is exempted under section 17 of Employees'
Provident Fund and Miscellaneous Provisions Act,1952. Conditions for
grant of exemption stipulate that the employer shall make good
deficiency, if any, in the interest rate declared by the trust
vis-Ã -vis statutory rate.
Defined Benefit Plan
The employees' gratuity fund scheme managed by a trust (Life Insurance
Corporation of India) is a defined benefit plan. The present value of
obligation is determined based on actuarial valuation using the
Projected unit credit Method, which recognizes each period of service
as giving rise to additional unit of employee benefit entitlement and
measures each unit separately to build up the final obligation. The
obligation for leave encashment is recognized in the same manner as
gratuity.
Note - 13
The company has prepared these financial statements as per the format
prescribed by Schedule III of the Companies Act, 2013 ('' the
schedule'') issued by Ministry of Corporate Affairs. Previous period's
figures have been recast/restated to conform to the classification
required by the Schedule - III
Note - 14
Previous year's figures have been regrouped/reclassified, wherever
necessary to confirm to current year's classification.
Mar 31, 2014
NOTE NO. 1
BASIS OF PREPARATION OF FINANCIAL STATEMENTS:
The financial statements have been prepared under the historical cost
convention on accrual basis to comply in all material aspects and in
accordance with generally accepted accounting principles in India and
the relevant provisions of the Companies Act,1956. The accounting
policies have been consistently applied by the Company unless otherwise
stated.
NOTE 2 (B)
Disclosure of shares held by its holding company
11060000 ( Pr. Year 11060000) Equity Shares fully paid up of Rs.1106
lakhs (Pr. Year Rs. 1106 lakhs ) are held by M/s Hindustan Organics
Chemicals Limited, the holding company.
NOTE 2 (D)
The company has only one class of shares referred to as equity shares
having a par value of Rs 10/- each.
Each holder of the equity share, as reflected in the records of the
company as of the date of the shareholders meeting, is entitled to one
vote in respect of each share held for all matters submitted to vote in
the shareholders meeting.
4(A). The Term loan from HOCL is secured by part of the land to the
extent of 82 acres of the factory & Plant and Buildings at Rudraram
Village.
4(B). The Term loan from HOCL of Rs. 2744.06 lakhs is Zero coupon loan
as per terms of the BIFR agreement and is repayable in seven equal
annual instalments as per the loan agreement commencing from F Y
2010-11. The instalment due for F Y 2010-11 , 2011-12,2012-13, 2013-14
amounting to Rs.1568.03 lacs is not paid by the company and current
maturities of F Y 2014-15 amounting to Rs.392.01 lacs are shown in Note
-8 under the head '' Other Current liabilities'' being current
maturities of long term debt.
4(C). The Term loan from HOCL of Rs.756.42 lakhs is Interest bearing @
10.25% to 14.50% repayable in 5 annual instalments commencing from F Y
2010-11 as per the loan agreement. The company is continuing default in
payment of instalment due and interest during the F Y 2010-11,2011-12 ,
2012-13, 2013-14 amounting to Rs.305.14 lacs is not paid by the company
and current maturities of F Y 2014-15 amounting to Rs.151.29 lacs are
shown in Note -8 of the financial statements under the head ''Other
Current liabilities'' being current maturities of long term debt and
interest due amounting to Rs.558.65 lakhs under Interest accrued and
due.
4(D) Term loan of Rs. 5.00 Crore @14.20% p.a. (floating) for
refurbishment of PTFE plant and setting up Modified PTFE plant
repayable in 5 years 3 months including monatorium period of 9 months
after the completion of the project commencing from April, 2015. The
company hypothecated land of 60.285 acres and plant and machinery as
collateral security besides furnishing of counter guarantee by promotor
company Viz., HOCL to this extent.
6(A).Secured by hypothecation of the company''s entire stock of raw
materials, finished goods, stock in process, consumables, stores &
spares and book debts, plant and machinery and part of the land to the
extend of Acres 60.285 out of the total land of Ac 146.13 cents at
Rudraram Village and guaranteed by the holding company, viz. Hindustan
Organic Chemicals Ltd. The cash credit is repayable on demand and
carries interest @14.2% p.a.
7(B).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.
13(B). Excise duty on closing finished goods in respect of goods
manufactured by the company amounting to Rs. 21.24 lacs (previous year
Rs.52.04 lacs) is included in the valuation of such stocks.
13(C). Finished goods, which have not moved for more than 3 years are
valued at Rs.1.00/kg and the consequential difference in value of
Rs.1.31 lacs (Previous year Rs.2.24 lacs) and there is no difference to
charge off during the year.
14(A). Balance standing to the debit/credit of parties is subject to
confirmation by them and reviews by the Company.
14(B) Debts over due for a period exceeding six months includes towards
case filed in High Court of Andhra Pradesh, which is pending amounting
to Rs.129.16 Lacs( Previous year Rs.129.16 Lacs)
15(A) Margin money deposits are subject to first charge/ lien to secure
the company''s cash credit loan and term loan.
16A. The changes in valuation of Inventory of Finished goods for the
year includes depletion on account of fall in selling price of finished
goods at net realizable value being lower than cost amounting to Rs.
373.77 Lacs (previous year Rs. 836.19 Lacs).
17(A). Both employer and employees make monthly contributions of 10%
instead of 12% as per BIFR scheme to a separately managed exempted EPF
Trust.
18(B). As per Accounting Standard 15 "Employee benefits", the
disclosures as defined in the Accounting Standard are given below:
The Company''s Provident Fund is exempted under section 17 of
Employees'' Provident Fund and Miscellaneous Provisions Act,1952.
Conditions for grant of exemption stipulate that the employer shall
make good deficiency, if any, in the interest rate declared by the
trust vis-a-vis statutory rate.
Defined Benefit Plan
The employees'' gratuity fund scheme managed by a trust (Life
Insurance Corporation of India) is a defined benefit plan.The present
value of obligation is determined based on actuarial valuation using
the Projected unit credit Method,which recognises each period of
service as giving rise to additional unit of employee benefit
entitlement and measures each unit seperately to build up the final
obligation. The obligation for leave encashment is recognised in the
same manner as gratuity.
18 (C) Actuarial valuation was carried out from F Y 2011-12 onwards.
18 (D) As per BIFR-MDRS, the company has implemented the wage revision
for officers and non- officers of 1997 w.e.f. December 2010 and wage
revision of 2007 w.e.f.October, 2012. Salary for the year includes
arrears provided on account of pay fixation in the revised scale vide
wage revision settlement as per DPE guidelines, based on 2007 wage
revision for officers and non- officers amounting to Rs.1018.34 lacs
(Pr.year Rs. 1044.57 lacs).
NOTE - 3 CONTINGENT LIABILITIES AND COMMITMENTS:
(Rs. In lacs)
As at As at
31 March 2014 31 March 2013
(i) Contingent Liabilities
(a) ESI 13.46 13.46
(b) Wage Revision arrears for employees 0.00 1070.34
13.46 1083.80
(ii) Commitments
(a) Estimated amount of contracts remaining
to be executed on capital account and not
provided for 287.25 0.00
300.71 1083.80
Note - 4 - TAXES ON INCOME:
26(A)The company has not provided deferred tax asset due to huge
accumulated losses incurred since there is no virtual certanity to
realise in future.
Note - 5
The company has prepared these financial statements as per the format
prescribed by Revised Schedule VI of the Companies Act, 1956 (" the
schedule'''') issued by Ministry of Corporate Affairs. Previous
period''s figures have been recast/restated to confirm to the
classification required by the revised Schedule - VI
Note - 6
Previous year''s figures have been regrouped/reclassified, wherever
necessary to confirm to current year''s classification.
Mar 31, 2013
BASIS OF PREPARATION OF FINANCIAL STATEMENTS:
The financial statement have been prepared under the historical cost
convention on accrual basis to comply in all material aspects and in
accordance with generally accepted accounting principles in India and
the relevant provisions of the Companies Act,1956. The accounting
policies have been consistently applied by the company unless otherwise
stated.
NOTE - 1 CONTINGENT LIABILITIES AND COMMITMENTS:
(Rs. In lacs)
As at As at
31 March 2013 31 March 2012
(i) Contingent Liabilities
(a) ESI 13.46 13.46
(b) Wage Revision arrears for
employees 1070.34 1159.85
1083.80 1173.31
(ii) Commitments
(a) Estimated amount of contracts
remaining to be executed
on capital account and not
provided for 0.00 65.00
1083.80 1238.31
Note - 2 - TAXES ON INCOME:
2(A). Provision for current tax on profits for the year has not been
made under Minimum Alternate Tax under section 115JB of Income Tax Act
1961 since the minimum of carried forward of losses or unabsorbed
depreciation as per books of accounts are set off during the year
against the current year book profit.
2 (B). The company has not provided deferred tax asset due to huge
accumulated losses incurred since there is no virtual certanity to
realise in future.
Note - 3
The company has prepared these financial statements as per the format
prescribed by Revised Schedule VI of the Companies Act, 1956 (''''the
schedule'''') issued by Ministry of Corporate Affairs. Previous period''s
figure have been recast/restated to confirm to the classification
required by the revised Schedule-VI
Note - 4
Previous year''s figures have been regrouped/reclassified, wherever
necessary to confirm to current year''s classification.
Mar 31, 2012
NOTE NO. 1
BASIS OF PREPARATION OF FINANCIAL STATEMENTS:
The financial statements have been prepared under the historical cost
convention on accrual basis to comply in all material aspects and in
accordance with generally accepted accounting principles in India and
the relevant provisions of the Companies Act, 1956. The accounting
policies have been consistently applied by the Company unless otherwise
stated.
NOTE 2 : SHARE CAPITAL
NOTE 2 (D)
The company has only one class of shares referred to as equity shares
having a par value of Rs 10.
Each holder of the equity share, as reflected in the records of the
company as of the date of the shareholder meeting, is entitled to one
vote in respect of each share held for all matters submitted to vote in
the shareholder meeting.
The company declares and pays dividends in Indian rupees. The dividend
proposed by the Board of Directors is subject to the approval of the
shareholders in the Annual General Meeting.
3(A). The Term loan is secured by part of the land to the extent 82.13
acres of the factory at Rudraram Village
3(B). The Term loan of Rs. 2744.06 lakhs is Zero coupon loan as per
terms of the BIFR agreement and is repayable in seven equal installment
as per the loan agreement commencing from F Y 2010-11. The installment
due for F Y 2010-11 & 2011-12 amounting to Rs. 784.01 lakhs is not paid
by the company and same is shown in Note - 9 under the head 'Other
Current liabilities' being current maturities of long term debt.
3(C). The Term loan of Rs. 754.42 lakhs is Interest bearing @ 10.25% to
14.50% repayable in 5 annual installment commencing from F Y 2010-11 as
per the loan agreement. The company is in continuing default in payment
of installment due and interest during the F Y 2010-11 & 2011-12. The
installment due of Rs. 301.77 lakhs is shown in Note -9 of the
financial statements under the head "Other Current liabilities" being
current maturities of long term debt and interest due amounting to Rs.
428.83 lakhs under Interest accrued and due.
NOTE 4 : OTHER LONG TERM LIABILITIES (Rs. In lakhs)
4(A). Creditors for capital goods includes an amount of Rs.850.74 lacs
payable to M/S SRF Ltd towards supply and erection of Plant and
Machinery relating to CDM Project. The total outstanding amount as per
contract for plant and machinery supply and mechanical completion is
Rs.1250.00 lacs. As per the terms of BOT contract dated 14-8-2007, the
payment is to be made in the form of CERs. The contract equated
Rs.1250.00 lacs to 6,59,500 CERs in 5 installments of 131900 each.
However, the total installments of CERs are reduced to 4.13 and the
company has so far transferred 210652 CERs as 1.32 installments for a
value of Rs.399.26 lacs. The balance Rs.850.74 lacs is payable in
balance 2.81 installments as per revised contract terms equaling to
448848 CERs.
5(A).Secured by hypothecation of the company's entire stock of raw
materials, finished goods, stock in process, consumables, stores &
spares and book debts, plant and machinery and part of the land to the
extent of Ac 64 out of the total land of Ac 146.13 cents at Rudraram
Village and guaranteed by the holding company, viz. Hindustan Organic
Chemicals Ltd. The cash credit is repayable on demand and carries
interest 15.5% p.a.
NOTE 6: TRADE PAYABLES (Rs. In lakhs)
7(A). Disclosure in accordance with Section 22 of Micro, Small and
Medium Enterprises Development Act, 2006
7(B). 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.
NOTE 8 : INVENTORIES
8(B). Excise duty on closing finishing goods in respect of goods
manufactured by the company amounting to Rs.16.87 lacs (previous year
5.34 lacs) is included in the valuation of such stocks.
8(C). Finished goods, which have not moved for more than 3 years are
valued at Rs. 1.00/kg and the consequential difference in value of
Rs. 2.24 lacs (Previous year Rs. 0.00 lacs) has been charged off during
the year.
NOTE 9: TRADE RECEIVABLES
15(A). Balance standing to the debit/credit of parties is subject to
confirmation by them and reviews by the Company.
NOTE 10: OTHER INCOME
10(A). The company has determined the Defined Benefit Plans being
Gratuity and leave encashment during the year on actuarial valuation,
as certified by actuary. This has resulted in excess provision of Rs.
65.89 lacs made in earlier years, which has been written back included
in other non-operating income.
NOTE 11: EMPLOYEE BENEFITS EXPENSES
11(A). Both employer and employees make monthly contributions of 10%
instead of 12% as per BIFR scheme to a separately managed exempted EPF
Trust.
11(B). As per Accounting Standard 15 "Employee benefits", the
disclosures as defined in the Accounting Standard are given below:
The Company's Provident Fund is exempted under section 17 of Employees'
Provident Fund and Miscellaneous Provisions Act, 1952. Conditions for
grant of exemption stipulate that the employer Shall make good
deficiency, if any, in the intrerest rate declared by the trust
vis-a-vis statutory rate.
Defined Benefit Plan
The employees' gratuity fund scheme managed by a trust (Life Insurance
Corporation of India) is a defined benefit plan. The present value of
obligation is determined based on actuarial valuation using the
Projected unit credit Method, which recognises each period of service
as giving rise to additional unit of employee benefit entitlement and
measures each unit separately to build up the final obligation. The
obligation for leave encashment is recognised in the same manner as
gratuity.
11(C). Previous year's figures are not reported, as the actuary
valuation was not carried out in earlier years and respective details
are unavailable.
11(D). The arrears on account of pay fixation in the revised scale with
effect from 01-01-1997 vide wage revision settlement as per DPE
guidelines, have not been provided for in books at the close of the
year amounting to Rs.1160 lakhs (Pr. year Rs.1552 Lakhs). As per
BIFR-MDRS, the company has implemented the wage revision for officers
and non officers w.e.f. December 2010 and arrears to this effect could
not be charged to profit and loss account since BIFR categorically has
stipulated that arrears should be released subject to availability of
funds. Accordingly, the liability has been shown under contingent
liability.
11 (E) An amount of Rs.95.71 lacs had been incurred towards VRS
payments for employees (Rs. 58.45 for 6 employees for the current year
and Rs. 37.26 lacs towards balance amount of an amortized) inprevious
year Rs. 74.52 lacs in accordance with BIFR's Modified Draft
Rehabilitation Scheme(MDRS) in August 2011. This total amount is taken
to P & L Account. In accordance with BIFR's Modified Draft
Rehabilitation Scheme (MDRS). As per AS-15 issued by ICAI, VRS
expenditure is to be written off
over the pay back period only and cannot be amortized. However the
company is following the BIFR Scheme.
NOTE - 12 CONTINGENT LIABILITIES AND COMMITMENTS:
(Rs. In lakhs)
As at As at
31 March 2012 31 March 2011
(i) Contingent Liabilities
(a) Claims against the company
not acknowledged as debt 0.00 12.01
(b) Guarantees/FLC/ILC/Obtained
as on 31-03-12 0.00 10.00
(d) ESI 13.46 13.46
(e) Wage Revision arrears for
employees 1159.85 1800.00
1173.31 1835.47
(ii) Commitments
(a) Estimated amount of contracts
remaining to be executed
on capital account and not
provided for 65.00 0.00
65.00 0.00
1238.31 1835.47
Note - 13 - TAXES ON INCOME:
13(A). Provision for current tax on profits for the year has not been
made under Minimum Alternate Tax under section 115JB of Income Tax Act
1961 since the minimum of carried forward of losses or unabsorbed
depreciation as per books of accounts are set off during the year
against the current year book profit.
13 (B). The company has not provided deferred tax asset due to huge
accumulated losses incurred since there is no virtual certainty to
realise in future.
Note - 14
The company has prepared these financial statements as per the format
prescribed by Revised Schedule VI of the Companies Act, 1956 ("the
schedule") issued by Ministry of Corporate Affairs. Previous period's
figure have been recast/restated to confirm to the classification
required by the revised Schedule-VI
Note - 15
Previous year's figures have been regrouped/reclassified, wherever
necessary to confirm to current year's classification.
Mar 31, 2011
1. The Company entered into a lease-cum-sale agreement with Andhra
Pradesh Industrial Infrastructure Company (APIIC) in April 1986 for the
land acquired by APIIC under the Land acquisition act and allotted
146.13 acres to the company. Subsequently the title in respect of the
land had been transferred in favour of the company.
2. SECURED LOANS:
2.1 Cash Credit, ILC/FLC/BG, Short Term Corporate Loan and Long Term
Loan facilities from State Bank of Hyderabad is secured by
hypothecation of raw materials, stock-in-process, finished goods,
consumable stores,book debts, Buildings, Plant and Machinery and
Company's Land (Ac.64.00 cents out of the total land of Ac 146.13 cents
at Rudraram Village).
2.2 Cash Credit, ILC/FLC/BG, Short Term Corporate Loan and Long Term
Loan facilities from State Bank of Hyderabad are guaranteed by the
holding company, viz. Hindustan Organic Chemicals Ltd.
2.3. An amount of Rs.3874.22 lacs (Previous year Rs.3753.17 lacs) is
due to Hindustan Organic Chemicals Limited (HOCL) including Rs.121.06
lacs (Previous year Rs.128.97 lacs) provided during the year as
interest on HOCL loan for which 1st Charge was created on Company's
land (Ac. 82.00 cents of land out of the total land of Ac 146.13 cents
at Rudraram Village).
2.4 The company has provided an amount of Rs. 135.99 lacs towards
interest on HOCL Loan. However no interest was provided for loan
amount of Rs.2609.72 lacs pursuant to BIFR Modified Draft
Rehabilitation Scheme.
2.5 During the year an amount of Rs.130.00 lacs was received from HOCL
(Holding Co.) as Unsecured Loan and interest to the extent of Rs. 14.93
accrued on the loan.
3. FIXED ASSETS:
3.1. The Company entered into a lease-cum-sale agreement with Andhra
Pradesh Industrial Infrastructure Company (APIIC) in April 1986 for the
land acquired by APIIC under the Land acquisition act and allotted to
the company. Subsequently the title in respect of the land had been
transferred in favour of the company in the year 1999-2000.
3.2. During the year the company has recognized an addition of
Rs.1250.00 lacs in the head Plant and Machinery pursuant to BOT
contract dated 14.8.2007 entered with M/S SRF LTD. As per the terms of
the contract the CDM Project is to be implemented with terms and
conditions.
The terms and conditions in brief are as under:
a. SRF Ltd. shall procure and install the CDM Plant for a contract
price of Rs.1250.00 lacs, the plant is used for incinerating R-23 gas
to claim for CERs from UNFCCC.
b. The Plant shall be handed over to the company after the Mechanical
run and commissioning of the system.
c. During the year 2010-11 the mechanical completion and commissioning
of the plant was completed in April 2010 (7th April, 2010) and handed
over to the company.
Pursuant to the above the company had capitalised Rs. 1250.00 lacs as
Plant and Machinery addition during the year. Along with the above
addition the company had capitalised the below amounts as addition to
the fixed assets.
Plant and Machinery Rs.260.70 lacs
Furniture and Fixtures Rs.1.91 lacs
Computers along with
software Rs.14.14. lacs
Machinery spares are accounted in closing stock as they are of general
usage.
3.3 No impariment of assets is done during the current financial year
as per AS-28.
4. INVENTORIES:
4.1 During the year the company reported the closing inventory of
Rs.2081.07 lacs. Out of the total the stock-in-process amounts to
Rs.65.86 lacs has detailed under and CER's stock was valued at
Rs.1697.07 lacs. With regard to CERs (Carbon Emission Reductions), they
are the Credits issued by UNFCCC(United Nations Framework Convention on
Climate Change) to the company for successful reduction / incineration
of R-23 gas. R-23 gas falls in the list of gases having potential of
global warming and is eligible category of Carbon Credits as per the
KYOTO Protocol. Hence the company is eligible for claiming Carbon
Credits after the incineration of the R-23 gas. In the previous year,
the company incinerated R-23 gas with technology help with BOT
Contractor SRF Ltd. (vide Built-operate-transfer agreement
dated(14-8-2007) and filed the data to UNFCCC for getting Carbon
Credits (CERs) During the current financial year 2010-11, UNFCCC
confirmed 420793 CERs to the company in its site (www.unfccc.int) after
deducting 2% i.e., 8588 CERs as adaptation fund deduction. Of the above
CERs received, the company had forgone 210652 CERs as instalments
payment to SRF Ltd., for the Plant and Machinery as per the BOT
agreement of Plant & Machinery entered 14th August,2007. After the
above outflow of CERs, the company is left with 210142 CERs treated as
finished closing stock. The value of the CERs is taken at
Rs.169706945/- adopting the value of 1 CER in the International
Exchange as on 31-03-2011 at 13.07 Euros and taking the Euro value at
Rs.63.05 in terms of INR and valued at 98% of the total value
(considering 2% margin for valuation)
4.2. Excise duty on closing finishing goods in respect of goods
manufactured by the company amounting to Rs.5.34 lacs (previous year
5.47 lacs) is included in the valuation of such stocks.
4.3. During the current year finished goods, which have not moved for
more than 3 years are valued at Rs.1.00/kg and the consequential
difference in value is Rs.0.00 lacs (Previous year Rs.0.00 lacs).
5. SUNDRY DEBTORS:
5.1. Debtors for the year amount to Rs.284.17 lacs net of provision for
doubtful debts provided for Rs.309.64 lacs.
6. LOANS AND ADVANCES:
6.1 Telephone deposits amounting to Rs.0.57 lacs pertains to more than
3 years period. No provision is made against this as it is recoverable
in nature.
7. CURRENT LIABILITIES :
7.1 Sundry Creditors includes Rs.2.23 lacs payable to Micro and small
enterprises as against nil amount in the previous year. No interest is
payable on the above amount.
7.2 Creditors for capital goods include an amount of Rs.862.25 lacs is
payable to M/S SRF Ltd towards supply and erection of Plant and
Machinery relating to CDM Project. The total outstanding amount as per
contract for plant and machinery supply and mechanical completion is
Rs. 1250.00 lacs. As per the terms of BOT Contract dated 14-8-2007, the
payment is to be made in form of CERs. The Contract equated Rs.1250-00
lacs to 6,59,500 CERs in 5 instalments of 131900 each. However, the
total instalments are reduced to 4.13 and the company transfered 210652
CERs as 1.32 instalments and valued them Rs.399.26 lacs. The balance
Rs.850.74 lacs is payable in balance 2.81 installments as per revised
contract terms equalant to 448848 CERs.
7.3 Amounts payable to PF, Property Tax, Nala Tax, AP Commercial Tax
pertain to more than one year payables.
7.4 Wage Revision (1997) settlement arrears pertaining to employees are
not provided in the books of accounts since the arrears are payable
only when the company generates adequate surplus of funds. However, it
is considered as Contingent liability in the Financial Statements on an
estimated amount basis.
8. EMPLOYEES' BENEFIT PLANS:
8.1 Both employer and employees make monthly contributions of 10% each
to a separately managed exempted EPF Trust.
8.2 Employees Gratuity Fund Scheme is managed a separate Trust
maintained with LIC of India through annuity scheme. The present value
of the obligation is determined by acturial valuation using projected
unit credit method which recognizes the period of service proportionate
to unit of employee benefits.
8.3 PROVISION FOR LEAVE ENCASHMENT:
An amount of Rs.147.98 lacs is provided as provision for the period
ended 31.3.2011 (previous year Rs.86.10 lacs). This provision is made
as per revised AS-15 issued by ICAI
9. INCOME:
9.1. Income for the company consist of sales (taken at gross) and
later net of exsice duty and other income. In accounting sales the
company had deducted an amount of Rs.89059.00 as trade discount on sale
of CFM which is passed by way of journal entry and not in the invoices
raised.
9.2. The other income of the company includes sale of CERs, job work of
Vikram Sarabhai Space Centre (VSSC) and others. The company accounted
for sale of CERs during the year. During the current financial year
210652 CERs received by the company are transferred to M/S SRF Ltd
against payment of instalment for CDM Plant and 9587.62 CERs are
deducted while issuing by UNFCCC against adaptation fund. The
transfered CERs are considered as income as the risk and reward was
transferred and reported under the head other income as 'CERs Sale'
valued at Rs.399.26 lacs. The CERs given to SRS Limited are valued as
per the BOT Agreement, dated 14-08-2007 wherein, the company equated
Rs.12,50,00,000 (total cost of Plant & Machinery and Installation /
commissioning cost of the CDM Plant and Machinery) to Rs.6,59,500 CERs
in the contract. The CERs given to UNFCCC are valued at the market
price in Stock Exchange of CERs on the date of such deduction by
UNFCCC.
9.3. The company entered into a MOU with Vikram Sarabhai Space Centre
(VSSC) in Financial Year 2009-10 for research and development of
certain chemical compounds. As per the MOU it is a tripartite MOU with
each party having its own mile stones and responsibilities. The company
income amounted to Rs.40.00 lacs in the MOU. The company raised invoice
of Rs.20.00 lacs from VSSC in financial year 2009-10 and received the
same in the current financial year 2010-11 and the second invoice was
raised for Rs.15.00 lacs in the financial year 2010-11. The company
treated the amount received in financial year 2009- 10 amounting to
Rs.20.00 lacs as prior paid income and Rs. 15.00 lacs received in the
year 2010-11 as 'miscellaneous income'. The company accounted the
amount received from VSSC as income as the milestones were achieved and
also as the agreement with VSSC does not contain clauses of any refund
of money to VSSC.
10. VRS EXPENDITURE
10.1 An amount of Rs.223.57 lacs had incurred towards VRS payments for
31 employees in accordance with BIFR's Modified Draft Rehabilitation
Scheme(MDRS) in Jan 2009. This amount is amortized and taken to P & L
Account over a period of 3 years. (Rs.37.26 in 2008-09, Rs. 74.52 lacs
in 2009-2010, Rs.74.52 Lacs in 2010-11 included in Schedule-15) the
balance of Rs.37.27 Lacs will be amortised in the next financial
year 2011-12. This is in accordance with BIFR's Modified Draft
Rehabilitation Scheme (MDRS). As per AS-15 issued by ICAI , VRS
expenditure is to be written off over the pay back period only and
cannot be amortised. However the company is following the BIFR Scheme.
11. REFURBISHMENT EXPENDITURE:
11.1 An amount of Rs.285.14 lacs has been incurred towards
Refurbishment Expenditure on Plant and Machinery. This amount is
amortised over a period of 5 years. Till the financial year 2010-11
Rs.180.01 lacs was taken to P & L Account and balance will be charged
to P & L Account for the next two years in accordance with BIFR's
Modified Draft Rehabilitation Scheme (MDRS). As per AS-6 issued by
ICAI, any expenditure incurred for improvement in performance of the
Plant & Machinery, should be capitalized and depreciated accordingly as
per Schedule -XIV applicable to the Company. However the Company is
following the guide lines contained in the BIFR's MDRS in this matter
deviating from AS-6 issued by ICAI.
12. CONTINGENT LIABILITIES NOT PROVIDED FOR:
2010-11 2009-10
Rs.in lacs Rs.in lacs
A Claims against the Company not
acknowledged as debts. 12.01 12.01
B FLC/ILC Obtained as on 31-03-2010 0.00 0.00
C ESI 13.46 13.46
D Wage Revision(1997) settlement
-Salary arrears for Officers on
estimated basis 700.00 600.00
E Wage Revision(1997) settlement
-Salary arrears for Non-officers 1100.00 1100.00
TOTAL 1825.47 1725.47
7 Estimated amount of contracts
remaining to be executed on
capital account and not provided
for (net of advances). 0.00 0.00
8 Expenditure incurred in foreign
currency NIL NIL
13. Unpaid overdue amounts due on 31st March, 2011 to Small
Scale/Ancillary Industrial suppliers on account of principal amount
together with interest aggregated to Rs.0.00 lacs (Previous year
Rs.0.00 lacs). This disclosure is based on information available with
the company with regard to the status of the suppliers as defined under
interest on delayed payments to Small Scale and Ancillary Industries
Undertaking Act, 1993.
14. Balance standing to the debit/credit of parties is subject to
confirmation by them and reviews by the Company.
16. ACCOUNTING FOR TAXES:
16.1.The company has not provided deferred tax asset/liability due to
huge'accumulated losses in the balance sheet and is uncertain of
realizing deferred tax asset against future taxable income.
17. Statutory Auditors' remuneration for Statutory Audit is Rs.0.60
lacs and Limited review fee of Rs.0.24 lacs.
22. RELATED PARTIES DISCLOSURE:
The company is a subsidiary of HOCL (HINDUSTAN ORGANIC CHEMICALS
LIMITED)
Interest payable to HOCL Rs.135.99 lacs
Secured Loan from HOCL
(including interest) Rs.4019.15 lacs
KEY MANAGEMENT PERSONNEL:
SHRI T S GAIKWAD, Managing Director
23. SEGMENT REPORTING:
The company is in full-fledged manufacturing activity of Chemicals.
There are no separate Primary and Secondary reportable segments. All
the manufacturing activity is considered as Single segment.
24. PRIOR PERIOD ITEMS:
During the year the company had net off Rs.20.08 lacs prior period
expense with Rs.23.24 lacs of prior period income and reported a net
prior period income of Rs.3.16 lacs.The prior period income is the
unpaid liabilities/unclaimed liabilities for more than 3 years.
25. LITIGATIONS AT VARIOUS AUTHORITIES:
SI.Authorities Nature of Quantam Remarks
No. Litigations
1 Hon'ble High Recovery from Rs.132.00 lacs The company had
Court of A.P Debtors a favorable
judgment from
the single
bench. The
deponent had
approached full
bench of High
Court.
2 Dy.Commissio Penalty u/s Rs.19.00 lacs The case is yet
ner of 53(3) of to come for
Appeals, A.P. Vat Act, first hearing.
VAT 2005 Not provided
F.Y. 2010-11. in the books
of accounts.
26. Previous year figures have been regrouped/reclassified/recast
wherever necessary to conform to current year's classification.
Mar 31, 2010
1. OTHERS:
1. The Company entered into a lease-cum-sale agreement with Andhra
Pradesh Industrial Infrastructure Company (APIIC) in April 1986 for the
land acquired by APIIC under the Land acquisition act and allotted to
the company. Subsequently the title in respect of the land had been
transferred in favour of the company.
2. LOANS:
2.1 Cash Credit, ILC/FLC/BG, Short Term Corporate Loan and Long Term
Loan facilities from State Bank of Hyderabad is secured by
hypothecation of raw materials, stock-in-process, finished goods,
consumable stores,book debts, Buildings, Plant and Machinery and
Companys Land Ac.64.00 cents out of the total land of Ac 146.00 cents.
2.2 Cash Credit, ILC/FLC/BG, Short Term Corporate Loan and Long Term
Loan facilities from State Bank of Hyderabad are guaranteed by the
holding company, viz. Hindustan Organic Chemicals Ltd..
3. An amount of Rs. 3753.17 lacs (Previous year Rs.3596.93 lacs) is
due to Hindustan Organic Chemicals Limited (HOCL) including Rs.128.98
lacs (Previous year Rs.110.98 lacs) provided during the year as
interest on HOCL loan for which 1st Charge was created on Companys Ac.
82.00 cents of land out of the total land of Ac 146.00 cents.
4. Credit has not been taken into account in respect of claims for
penalty / damage recoverable from certain suppliers/ works contractors
arising due to non- adherence to the stipulated contractual terms.
5. During the current year finished goods, which have not moved for
more than 3 years are valued at Rs.1,00/kg and the consequential
difference in value is Rs.0.00 lacs (Previous year Rs.O.OO lacs).
6. CONTINGENT LIABILITIES NOT PROVIDED FOR:
2009-10 2008-09
Rs.in lacs Rs.in lacs
A Claims against the Company not
acknowledged as debts. 12.01 12.01
B FLC/ILC Obtained as on 31-03-2010 0.00 134.50
C ESI 13.46 13.46
D Salary arrears for Officers 600.00 570.00
E Salary arrears for Non-officers 1100.00 1030.00
F Differential Sales Tax due to
non submission of "C" forms 13.88 276.07
TOTAL 1739.35 2036.04
7. Estimated amount of contracts
remaining to be executed or
capital account and not provided
for (net of advances). 0.00 0.00
8. Expenditure incurred in foreign
currency NIL NIL
9. Excise duty on closing finishing goods in respect of goods
manufactured by the company amounting to Rs.5.47 lacs (previous year
1.79 lacs) is included in the valuation of such stocks.
10. Unpaid overdue amounts due on 31st March, 2010 to Small
Scale/Ancillary Industrial suppliers on account of principal amount
together with interest aggregated to Rs.O.OO lacs (Previous year
Rs.O.OO lacs). This disclosure is based on information available with
the company with regard to the status of the suppliers as defined under
interest on delayed payments to Small Scale and Ancillary Industries
Undertaking Act, 1993.
11. Balance standing to the debit/credit of parties is subject to
confirmation by them and reviews by the Company.
12. As required by Accounting Standard 28 loss on impairment of
incinerator system an amount of Rs.O.OO (Previous year 34.25 lacs) is
charged off during the year.
13. As per AS- 22 issued by ICAI, the company has not accounted the
related tax on them in its books as deferred tax assets/liability, as
no sufficient income is available to realize them. Company shall
recognize related tax on them, as deferred tax assets in succeeding
years only when there is certainty that sufficient taxable income will
be available.
14. Auditors remuneration includes Statutory Audit fee Rs.0.60 lacs
and Limited review Rs.0.24 lacs.
15. During the year HFC viz. R-23 gas storage facilities were created
under CDM project. The company accumulated HFC-23 Gas 42.5 MT, stored
in the tank has been considered for eligible CERs to the tune of 497250
CERs. Out of this SRF(BOT Contractor of CDM Project) share is two years
installments around 263800 CERs and PWC - CDM Project Consultants
share is around 5% i.e. 11672.5 CERs. Balance is pertaining to HFL i.e.
221777.50 CERs. Insurance coverage is also taken for Rs.43.50 crores
to cover any eventuality for one year accumulation of HFC-23 Gas. The
eligible CERs of our portion 221777.50 CERs is considered as WIP and
valued at the lowest rate quoted during the year in the international
market i.e.Euro 10.5 per CER at exchange conversion rate of Rs.60 per
EURO as on 31.3.2010. The value of CERs taken as WIP is Rs.1397.00
lacs. AsperAS-2 issued by ICAI in respect of closing stock valuation
shall be made at Cost or Net Realisable value which ever is less. The
cost of producing R-23 gas is Nil. The valuation of R-23 Gas is in
deviation of AS-2.
16. Previous year figures have been regrouped/reclassified/recast
wherever necessary to conform to current years classification.
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