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Notes to Accounts of Hindustan Wires Ltd.

Mar 31, 2018

1. RELATED PARTIES DISCLOSURES

(i) Relationships :

a) Holding Company

1 Kashipur Holdings Limited

b) Key Management Personnel (KMP):

2 Mr. R.K.Gupta

c) Other Related Parties with which Company has transactions:

(Enterprises over which the holding Company or the promoters of the holding company are able to exercise

significant influence)

1 India Glycols Limited (IGL)

2 IGL Infrastructures Pvt Ltd (IGL IPL)

3 Kashipur Infrastructures & Freight Terminal Pvt Ltd (KIFTL)

1 Market Risk: Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises mainly three types of risk: interest rate risk, currency risk and other price risk such as commodity price risk.

(a) Foreign Currency Risk: Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The company is not having foreign currency trade payables and receivables and is therefore, not exposed to foreign exchange risk.

(b) Interest Rate Risk: Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Any changes in the interest rates environment may impact future rates of borrowing. The company mitigates this risk by regularly assessing the market scenario, interest rate negotiations with the lenders for ensuring the cost effective method of financing.

(c) Commodity Price Risk: The company is affected by the price volatility of certain commodities. its operating activities require the purchase of liquid industrial Gases. For commodity price risk, the company has an approved supplier base to get best competitive prices for the commodities and to assess the market to manage the cost without any compromise on quality.

2 Credit Risk: Credit risk is the risk that counterparty might not honor its obligations under a financial instrument or customer contract, leading to a financial loss. Credit risk encompasses of both, the direct risk of default and the risk of deterioration of creditworthiness as well as concentration of risk. Credit risk is controlled by analyzing credit limits and creditworthiness of customers on a continuous basis to whom the credit has been granted after obtaining necessary approvals for credit. Financial instruments that are subject to concentrations of credit risk principally consist of trade receivables.

Trade Receivables: Customer credit risk is managed based on company''s established policy, procedures and controls. The company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.

For trade receivables Company applies ''simplified approach'' which requires expected lifetime losses to be recognized from initial recognition of the receivables. The Company uses historical default rates to determine impairment loss on the portfolio of trade receivables. At every reporting date these historical default rates are reviewed and changes in the forward looking estimates are analyzed.

Credit risk is reduced by receiving pre-payments and letter of credit to the extent possible. The company has a well-defined sales policy to minimize its risk of credit defaults. Outstanding customer receivables are regularly monitored and assessed. impairment analysis is performed based on historical data at each reporting date on an individual basis.

3 Liquidity Risk: Liquidity risk is the risk, where the company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The company''s approach is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when due.

4. CAPITAL MANAGEMENT

The company''s policy is to maintain an adequate capital base so as to maintain creditor and market confidence and to sustain future development. capital includes issued capital, share premium and all other equity reserves attributable to equity holders. The primary objective of the Company''s capital management is to maintain an optimal structure so as to maximize the shareholder''s value. In order to strengthen the capital base, the company may use appropriate means to enhance or reduce capital, as the case may be.

The company is not subject to any external imposed capital requirement. The company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. Net Debt is calculated as borrowings less cash and cash equivalents.

5. OPERATING SEGMENTS

As the Company''s business activity primarily falls within a single business and geographical segment i.e. Gas Business , thus there are no additional disclosures to be provided under Ind AS 108 - "Operating Segment". The management considers that the various goods and services provided by the Company
constitutes single business segment since the risk and rewards are not different from one another.

6. FAIR VALUES

Set out below, is a comparison by class of the carrying amounts and fair value of the financial instruments of the company:

The following methods and assumptions were used to estimate the fair values:

1. Cash and short-term deposits, trade receivables, loans, trade payables, and other current financial assets and liabilities approximate their carrying amounts largely due to the short-term maturities of these instruments.

2. Other non-current receivables are evaluated by the company, based on parameters such as interest rates, individual credit worthiness of the counterparty etc. Based on this evaluation, allowances are considered to account for the expected losses of these receivables. As at end of each reporting year, the carrying amounts of such receivables, net of allowances (if any), are not materially different from their calculated fair values.

3. Fair value of investments in quoted mutual funds and equity shares are based on quoted market price at the reporting date.

4. Fair value of borrowings from banks and other non-current financial liabilities, are estimated by discounting future cash flows using rates currently available for debt on similar terms and remaining maturities.

5. The fair values of derivatives are calculated using the RBI reference rate as on the reporting date as well as other variable parameters.

Fair Value Hierarchy

All financial assets and liabilities for which fair value is measured in the financial statements are categorized within the fair value hierarchy, described as follows:

Level 1 - Quoted prices in active markets.

Level 2 - inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly. Level 3 – inputs that are not based on observable market data.

During the year ended March 31st, 2018 and March 31st, 2017, there were no transfers between Level 1 and Level 2 fair value measurements and no transfer into and out of Level 3 fair value measurements.

7. Public Sector Oil Companies i.e. IOCL,HPCL, BPCL, and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The oil companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- from the supply bills of the Company. The company is contesting this reduction in price of Cylinders before the appropriate authorities. However since the matter had become very old and after considering the principles of financial prudence the entire amount was written off in the books of accounts in earlier years. As the matter of prudence, the entire amount is provided for and written off without prejudice to the right of recovery through legal process.

8. Events Occurring after the Balance Sheet

The company after the Balance Sheet data (31.03.2018) has entered into an agreement to sell its Land and Building situated at Faridabad Unit. However the Company will continue to operate its current line of business from nearby location to be taken on rent.

9. RECONCILIATIONS Overall principle

These are the Company''s first financial statement prepared in accordance with Ind AS, accordingly the Company has prepared the opening Balance Sheet as per Ind AS at of April 1, 2016 (the transition date) by recognizing all assets and liabilities whose recognition is required by Ind AS, not recognizing items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognized assets and liabilities.

The following reconciliations provide a quantification of the effect of significant differences arising as a result of transition from Previous GAAP to ind AS in accordance with ind AS 101:

- Reconciliation of Equity as at April 01, 2016 (date of transition to Ind-AS)

- Reconciliation of Equity as at March 31, 2017

- Reconciliation of Statement of Profit and Loss for the year ended 31st March, 2017

- Notes to Reconciliation of Equity as at April 01,2016 & March 31,2017 and Statement of Profit and Loss for the year ended 31st March, 2017

Notes to Reconciliation of Equity as at April 01,2016 & March 31,2017 and Statement of Profit and Loss for the year ended 31st March, 2017

A. Property, Plant and Equipment (PPE)- Fair Value as Deemed cost in Ind AS

Ind AS 101 permits first time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in financial statement as at date on transition to Ind AS , measured as the previous GAAP and use that as its deemed cost as at date of transition. Accordingly Company has elected to measure all of its Property, Plant and Equipment at their previous GAAP carrying value .

B. Investments other than investment in Subsidiary and joint venture

Under Indian GAAP non-current investments other than investment in subsidiary, joint venture are measured at cost less any permanent diminution in value of investment. Difference between the cost and market price is recognized in profit and loss. Under Ind AS, investments are designated as fair value through profit and loss (FVTPL)

On the transition date the Investments in Quoted Shares have been measured at their fair value which is less than the cost as per previous GAAP, resulting in increase in carrying amount by Rs.2.70 Lakhs as at transition date with resulting gain adjusted in retained earnings.

C. Fair valuation of financial assets and liabilities

Under Indian GAAP, receivables and payables were measured at transaction cost less allowances for impairment, if any. Under Ind AS, these financial assets and liabilities are initially recognized at fair value and subsequently measured at amortized cost using the effective interest method, less allowance for impairment, if any. The resulting finance charge or income is included in finance expense or finance income in the Statement of Profit and Loss for financial liabilities and financial assets respectively.

D. Redeemable Cumulative/Non-Cumulative Preference Shares

The Company had issued Redeemable Cumulative/Non-Cumulative Preference Shares. The Preference shares carry fixed dividend which is at the discretion of the Company. Under Indian GAAP, the Preference shares were classified as equity and dividend payable thereon, if any, was treated as distribution of Profit.

Under Ind-AS , these Preference Shares are separated into liability and equity based on the terms of the contract. Interest on liability component is recognized using effective interest rate method. Thus the preference share capital is reduced by Rs. 237.90 Lakhs as at March 31,2017 and Rs. 237.90/- Lakhs as at April 1,2016 with a corresponding increase in Borrowings as liability and tax component.

E. Deferred Tax

Previous GAAP requires deferred tax accounting using the income statement approach, which focuses on differences between taxable profits and accounting profits for the period. Ind AS requires entities to account for deferred taxes using the balance sheet approach, which focuses on temporary differences between the carrying amount of an asset or liability in the balance sheet and its tax base.

The various transitional adjustments lead to temporary differences. Accordingly the Company has to account for such differences. Deferred tax adjustments are recognized in correlation to the underlying transaction in Retained Earnings. The net impact on deferred tax assets is Rs.133.57 Lakhs as on the date of transition and net impact on deferred tax assets is Rs.106.80 Lakhs for the year ended March 31,2017.

F. Defined benefit obligations

The impact of change in actuarial assumption and experience adjustments for defined benefit obligation towards gratuity liability is accounted in the Statement of Other Comprehensive Income and corresponding tax impact on the same. Due to this, Rs.0.70 lakhs (Net of deferred tax) for the period ended March 31, 2017, tax credit thereon is shown in OCI and reversal in Statement of Profit and loss.

G. MAT Credit Entitlement

Mat credit entitlement has been reclassified to Deferred Tax Assets as per Ind AS. Therefore Rs. 23.35 lakhs and Rs. 65.73 lakhs have been reclassified from MAT credit to Deferred Tax Assets on the date of transition on April 1,2016 and March 31,2017 Respectively.

10. The impact of transition from Indian GAAP to Ind AS on the Statement of Cash Flows is due to various reclassification adjustments recorded under Ind AS in Balance Sheet and Statement of Profit & Loss.

11. (i) Figures Relating to April 1, 2016 (date of transition) and previous year have been restated / regrouped / reclassified wherever necessary to make them comparable with the current year figures.

(ii) Previous year figures were audited by another firm of Chartered Accountants.


Mar 31, 2016

1. (i) The Company during the year, has forfeited an advance of Rs. 300 lacs which was received by the Company during the year 2014-15 against agreement for part sale of the Industrial land of the Company at Faridabad. The buyer has not made further payments in terms of the agreement and due to the dispute the matter was referred for arbitration under the Arbitration and Conciliation Act 1996. The Arbitrator had given the award in favour of the Company and consequently the amount was forfeited and is considered as exceptional income in the current year.

2. Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. However since the matter had become very old and after considering the principles of financial prudence the entire amount was provided in the books of accounts, out of which Rs. 1,94,73,856/was written off in earlier years up to 31-03-2015 and the remaining amount of Rs. 1,29,82,571/- is written off in the current year and adjusted against the provision already held in this respect.

3. The Company ceases to be a Sick Industrial Company within the provision of Sick Industrial Companies (Special Provision) (SICA) Act 1985, as its net worth had turned positive. Therefore the Company has been discharged from the purview of SICA vide BIFR order dated 22nd July, 2015.

4. The amount due to units covered under “The Micro, Small & Medium enterprises Development Act, 2006” in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ).

5. Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company''s Fixed Assets as required by Accounting Standard (AS)-28 “Impairment of Assets”. If any indication exits, an Asset''s realizable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company''s Fixed Assets.

6. Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

7. Employees Benefits- Disclosure pursuant to AS-15

During the year the Company has calculated and recognized the various benefits provided to employees in the Statement of Profit & Loss for the year ended 31st March, 2016 which are as under:

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

8. Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company has reviewed its Business prospects in coming years and observed that there is no certainty of earning Business profits in coming years and as such the amount of Deferred Tax Assets is calculated at Nil .

b. Current Taxation

The Company has made provision for MAT under section 115JB of the income tax Act, 1961 amounting to Rs. 23.35 lacs after making adjustment of carry forward losses and unabsorbed depreciation. The Income Tax assessment of the Company are completed up to the assessment year 2015.2016.

9. Related Party Disclosure:

Related party as required by Accounting Standard—AS 18 "Related Parties Disclosures" issued by the Institute of Chartered Accountants of India are given below:

(a) Holding Company Kashipur Holdings Ltd

(b) Key Management Personnel Mr.R.K.Gupta (Executive Director)

(c) Enterprises over which the holding company or the promoters of 1. India Glycols Ltd the holding company are able to exercise significant influence. 2. IGL Finance Ltd

10.. IGL Infrastructure Pvt Ltd

11. Kashipur Infrastructure & Freight Terminal Pvt Ltd

12. Sukhvarsh Distributors Pvt Ltd

(d) Relatives of Directors 1. Mrs Pragya Bhartia Barwale

(Related to Mr. U.S.Bhartia)

Capital Employed

Assets and Liabilities could not be identified segment wise as the assets are in common use. 34 Previous Year''s figures have been regrouped/rearranged/recast wherever considered necessary.


Mar 31, 2015

1 Preference Shares are redeemable after fifteen years beginning from 10th March 2014.

2 : SHARE CAPITAL :

3.1 The Company has entered into agreements to sell part of its land subject to regulatory approvals and has received advance which is repayable without interest, in case the requisite regulatory approvals are not granted to the Company.

4 : Other Current Liabilities :

5 Contingent Liabilities and commitments : As at As at (to the extent not provided for) 31st March, 2015 31st March, 2014

Contingent Liabilities:

(i) Claims against the Company not acknowledged as debts 44.36 60.34

(ii) Dividend Liability on 15% Cumulative Preference Shares 3.50 0.20

(iii) Claim/demands from owner of the rented property in Kolkata which are under litigation- amount not ascertainable.

Sub Total 47.86 60.54

Commitments:

Estimated amount of contracts unexecuted on capital account - -

Sub Total - -

6 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/-(previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. The entire amount is already provided in the Books, even though out of this amount Rs. 1,29,82,571/- is considered recoverable but considering the principles of financial prudence provision for the same was made in the previous year.

7 The Company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The net worth of the Company became positive and such the Company applied to BIFR for de-registration of the Company from the purview of Sick Industrial Companies (Special Provision) (SICA) Act, 1985. However, the decision of the BIFR in this matter is still awaited. The matter is being pursued by the Company.

8 (a) Interest on Unsecured loans of Rs. Nil (previous year Rs. 81,20,984/-) from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

(b) During the year the Company has given short term loan of Rs.8,65,00,000/- in its usual course of Business to its Holding Company i.e. Kashipur Holdings Limited (NBFC Company) on interest @ 11% P.A.

9 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ).

10 Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company’s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset’s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company’s Fixed Assets.

11 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

12 Employees Benefits- Disclosure pursuant to AS-15

During the year the Company has calculated and recognised the various benefits provided to employees in the Statement of Profit & Loss for the year ended 31st March, 2015 which are as under:

Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

13 Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company has reviewed its Business prospects in coming years and observed that there is no certainty of earning Business profits in coming years and as such the amount of Deferred Tax Assets is calculated at Nil .

b. Current Taxation

In view of carry forward losses and unabsorbed depreciation no provision for regular Tax as well as for MAT has been made under Section 115-JB of the Income Tax Act. The Income Tax Assessment of the Company are completed up to Assessment year 20132014.

14 Pursuant to Companies Act, 2013 ("the ACT"), being effective from 1st April, 2014, the Company has revised depreciation rates on fixed assets as per the useful life specified in part "C" of Schedule II of the Act. As a result of the change, the depreciation charge is higher by Rs 8.63 Lacs for the year ended 31st March, 2015. Further, an amount of Rs.1.31 lacs has been recognized in the opening balance of the retained earnings by adjusting in retained earning for the assets where remaining useful life as per schedule II of the said act has become nil

15 Segment Reporting :

The Company has considered "Financing" as a Segment with effect from quarter ended 31st March, 2015 and accordingly figures for the previous period has been regrouped :

16 Previous Year’s figures have been regrouped/recast wherever found necessary to confirm to this years classification in view of the applicability of the revised Schedule III to the Companies Act 2013.


Mar 31, 2014

1.1 Preference Shares are redeemable after fifteen years beginning from 10th March 2014. During the year the Company had issued 15% Redeemable Cumulative / Non-Cumulative Preference Shares amounting to Rs. 490.00 lacs and out of the proceeds of the issue has redeemed the existing Preference Shares of Rs. 490.00 lacs.

2.1 The Company has entered into an agreement to sell part of its land to an associate Company which has given this Advance, repayable without interest, in case regulatory approvals are not granted to the Company for its sale.

( in lacs)

Note No. Particulars

3 Contingent Liabilities and commitments : As at As at (to the extent not provided for) 31st March, 31st March, 2014 2013

(i) Claims against the company not acknowledged as debts 60.34 115.33

(ii) Claim of the ex-employees under litigation, amount not ascertainable.

(iii) Claim/demands from owner of the rented property in Kolkata which are under litigation- amount not ascertainable.

Sub Total 60.34 115.33

Commitments:

Estimated amount of contracts unexecuted on capital account - -

Sub Total - -

4 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. The Company till the previous year out of these amounts had considered 40 % of the amount i.e. Rs.1,29,82,571/- considered good for recovery. However in the current year the management has reviewed the matter and considering the slow progress in the recovery proceedings and also considering the principles of financial prudence provision for doubtful debts has been made to the extent of Rs. 1,29,82,571/-.

5 The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The Hon''ble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8th November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985, but the BIFR negated the original Scheme due to non and delayed compliance and discharged the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has set aside the order of BIFR and remanded the matter to BIFR and the decision in this matter is awaited. The matter is being pursued by the Company.

6 Interest on Unsecured loans of Rs. 81,20,984/-(previous year Rs. 1,17,70,984/-) from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

7 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ).

8 Impairment of Assets'' Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company''s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset''s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company''s Fixed Assets.

9 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

10 Employees Benefits- Disclosure pursuant to AS-15

The Company has calculated and recognised the various benefits provided to employees in the Statement of Profit & Loss during the year ended 31st March, 2014 as under:

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

11 Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company has reviewed its Business prospects in coming years and observed that there is no certainty of earning Business profits in coming years and as such the amount of Deferred Tax Assets is calculated at Nil .

b. Current Taxation

In view of carry forward losses and unabsorbed depreciation no provision for regular Tax as well as for MAT has been made under Section 115-JB of the Income Tax Act. The Income Tax Assessment of the Company are completed up to Assessment year 2012-2013.

12 Related Party Disclosure:

Related party as required by Accounting Standard—AS 18 "Related Parties Disclosures" issued by the Institute of chartered Accountants of India are given below:

(a) Key Management Personnel Mr.R.K.Gupta (Executive Director)

(b) Enterprises over which key Management personnel or his relatives are able to exercise significant influence. Nil

(c) Holding Company Kashipur Holdings Ltd

(d) Other Related Parties (Associates) 1. Searock Credit (P) Ltd (with whom transactions have taken place) 2. India Glycols Ltd

3. Facit Commosales (P) Ltd

4. Sukhvarsha Distributors Pvt Ltd

5. IGL Finance Ltd

13 Segment Reporting As Required By Accounting Standard-17

Presently the Business activity of the Company falls within a single primary business segment viz Industrial Gases as such the disclosure requirement of Accounting standard (AS) - 17 "Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

14 Previous Year''s figures have been regrouped/recast wherever found necessary to confirm to this years classification in view of the applicability of the revised Schedule VI to the Companies Act 1956.


Mar 31, 2013

1 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. Based upon the management estimation, out of these amounts forty percent of amount i.e. Rs. 1,29,82,571/- is considered recoverable and the balance amount of Rs. 1,94,73,856 has been written off during earlier years.

2 The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The Hon''ble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8* November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985, but the BIFR negated the original Scheme due to non and delayed compliance and discharged the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has set aside the order of BIFR and remanded the matter to BIFR and the decision in this matter is awaited. The matter is being pursued by the Company.

3 Interest on Unsecured loans of Rs. 1,17,70,984/-(previous year Rs. 2,29,70,984/- from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off theirclaims of interest.

4 The amount due to units covered under "The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ). In respect of Sodepur Unit the factory was permanently closed on 1/8/2002, however in respect of outstanding Sundry Creditors the company had requested them to furnish the relevant registration certificate, but none of them have furnished the Certificate, it is deemed that none of them is covered under the said Act.

5 Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company''s Fixed Assets as required by Accounting Standard (AS)-28 "Impairment of Assets". If any indication exits, an Asset''s realisable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company''s Fixed Assets.

6 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.


Mar 31, 2012

1.1 Equity Shares held by Holding Company i.e. Kashipur Holdings Ltd and in excess of 5% of the Capital of the Company.

(Rs.in lacs)

Note No. Particulars

2 Contingent Liabilities and commitments : As at As at

( to the extent not provided for) 31st March, 2012 31st March, 2011 Contingent Liabilities:

(i) Claims against the company not acknowledged as debts 115.33 60.34

(ii) Dividend liability on 15%Cummulative Preference Shares 42.90 39.60

(iii) Claim of the ex-employees under litigation, amount not ascertainable.

(iv) Claim/demands from owner of the rented property in kolkata which are under litigation- amount not ascertainable.

Sub Total 158.23 99.94 Commitments:

Estimated amount of contracts unexecuted on capital account - 14.35

Sub Total - 14.35

3 Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,24,56,427/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. Based upon the management estimation, out of these amounts forty percent of amount i.e. Rs. 1,29,82,571/- is considered recoverable and the balance amount of Rs. 1,94,73,856 has been written off during earlier years

4 The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act, (SICA), 1985. The Hon’ble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8th November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985, but the BIFR negated the original Scheme due to non and delayed compliance and discharged the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has set aside the order of BIFR and remanded the matter to BIFR and the decision in this matter is awaited. The matter is being pursued by the Company.

5 Interest on Unsecured loans of Rs. 2,29,70,984/-(previous year Rs. 2,50,70,984/- from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

6 The amount due to units covered under “The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ). In respect of Sideburn Unit the factory was permanently closed on 1/8/2002, however in respect of outstanding Sundry Creditors the company had requested them to furnish the relevant registration certificate, but none of them have furnished the Certificate, it is deemed that none of them is covered under the said Act.

7 Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Company’s Fixed Assets as required by Accounting Standard (AS)-28 “Impairment of Assets". If any indication exits, an Asset’s realizable amount is estimated. During the year The Company has reviewed the Fixed Assets of the Company and found that there is no indication of impairment of the carrying amount of the Company’s Fixed Assets.

8 Balances in Debtors, Creditors, advances and Deposit accounts are subject to confirmations.

D Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

9 Taxation

a. Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of “Accounting for Taxation on Income". Accordingly, the Company had computed deferred tax liability and assets and based upon the data available it has kept the amount of Deferred Tax Assets in previous year Rs. 50 lacs. However, in the current year based on the present estimated future earnings, the amount of Deferred Tax Assets is re-calculated Nil .

b. Current Taxation

In view of carry forward losses and absorbed depreciation no provision of Income Tax (MAT) has been made under Section 115-JB of the Income Tax Act.

Notes:-

(i) The above information as to Related parties have been identified by the Management on the basis of information available with the Company and relied by the Auditors.

(ii) Figures in brackets represent the figures of previous year.

10 Segment Reporting As Required By Accounting Standard-17

Presently the Business activity of the Company falls within a single primary business segment viz Industrial Gases as such the disclosure requirement of Accounting standard (AS) - 17" Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

11 Previous Year’s figures have been regrouped/recast wherever found necessary to confirm to this years classification in view of the applicability of the revised Schedule VI to the Companies Act 1956.


Mar 31, 2010

1. Estimated amounts of contracts remaining to be executed on capital account and not provided for are Rs. Nil (Previous year Rs. 6,70,193/- (Advances Rs. 4,23,131/-)

2. Contingent Liabilities (not provided for) in respect of:

(a) Dividend liability on 15% Cumulative Preference Shares amounting to Rs.36,30,000/- (Previous Year Rs. 33,00,000/-).

(b) Sales Tax Demands amounting to Rs. Nil (Previous Year Rs 49,77,882/-)

(c) Claims/demands which are under litigation, not acknowledged as debts Rs. 60,33,560/-(previous year- 60,33,560)

3. Public Sector Oil Companies i.e. IOCL, HPCL, BPCL and IBP had reduced in the earlier years, the price of LPG cylinders with retrospective effect i.e. from 01.07.1999. The Oil Companies after reduction in prices had withheld in aggregate Rs. 3,24,56,427/- (previous year Rs. 3,22,59,026/-) from the supply bills of the Company. The Company is contesting this reduction in price of Cylinders before the appropriate authorities. Based upon the management estimation, out of these amounts at least forty percent of amount [Rs. 1,29,82,571] is considered recoverable and the balance amount (Rs. 1,94,73,856) has been written off during the year, out of which Rs. 1,29,82,571/-has been adjusted against provisions and the balance has been charged to Profit & Loss Account.

4. (a) The company is a Sick Industrial Company as per Sick Industrial Companies (Special Provision) Act,

(SICA), 1985. The Honble Appellate Authority for Industrial and Financial Reconstruction (AAIFR) had vide order dated 8lh November 2002 sanctioned the Rehabilitation Scheme of the Company. The Company moved an application to BIFR in November, 2006 seeking deregistration from the purview of SICA 1985 based on positive net worth, but the BIFR negated the original Scheme due to non and delayed compliance and declared the Company out of the purview of SICA 1985. The Company preferred an Appeal against the said order and the Appellate Authority has remanded the matter to BIFR and the decision in this matter is awaited. (b) Interest on Unsecured loans of Rs. 3,10,70,984/-(previous year Rs. 3,28,36,484/- from Holding Company & Associate Companies of promoters have not been provided for in the accounts in terms of sanctioned Rehabilitation Scheme and the said Companies have agreed to waive off their claims of interest.

5. (a) The amount due to units covered under The Micro, Small & Medium enterprises Development Act, 2006" in respect of Faridabad Unit is Rs. NIL (Previous Year Rs. Nil ). In respect of Sodepur Unit the factory was permanently closed on 1/8/2002, however in respect of outstanding Sundry Creditors the company had requested them to furnish the relevant registration certificate, but none of them have furnished the Certificate, it is deemed that none,of them is covered under the said Act. (b) Other Liabilities in Schedule F includes Sales Tax amounting to Rs. 40,46,248/- (previous year Rs.52,22,197/-).

6. Impairment of Assets—Consideration is given at Balance Sheet date to determine whether there is any indication of impairment of the carrying amount of the Companys Fixed Assets as required by Accounting Standard (AS)- 28 "Impairment of Assets". If any indication exits, an Assets realisable amount is estimated. During the year the Company has written off Fixed Assets amounting to net value of Rs. 1.57 lacs, hence provision for Impairment of Fixed Assets amounting to Rs. 3.00 lacs has been written back. The remaining recoverable amount of Assets after sale and written off is Rs. 0.23 lacs which is estimated by the management and is relied upon by the Auditors and has been shown as Assets held for Disposal.

7. The total Debts under litigation/Arbitration is Rs. 2,12,42,086/-, (Previous year Rs. 4,71,39,904/-) out of the same there is total provision amounting to Rs. 57,67,080/- (Previous year Rs. 2,54,74,939/) for the debts considered doubtful. The total debts under litigation includes Rs. 20,44,420/- (Previous year Rs. 67,04,880/-) due from such Companies which are either referred to BIFR or are in liquidation.

8. (a) In the opinion of the Board, Current Assets, Loans and Advances have a value on realisation in the ordinary course of business, unless otherwise stated equal to the amount at which they are stated.

(b) Balances in Debtors, Creditors, Advances and Deposit accounts are subject to confirmations.

9. The Company w.e.f.1st April, 2007 has adopted revised Accounting Standard As-15 issued by The Chartered Accountants of India on employee benefits.

The Company has calculated and recognised the various benefits provided to employees in the Profit & Loss Account during the year ended 31st March, 2010 as under:

C) Defined Benefit Plans

1. Gratuity

2. Leave Encashment

D) Actuarial Assumptions

The discount rate assumed is 7%, which is determined by reference to the market yield on Government Bonds as at Balance Sheet date. The estimate of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors such as supply and demand in the employment market.

10. Taxation:

a) Deferred Taxation

The institute of Chartered Accountants of India, has made mandatory the Accounting Standard-22 (AS-22) in respect of "Accounting for Taxation on Income". Accordingly, the Company had computed deferred tax liability and assets as at 31.03.2007 and based upon the data available at that time, it created deferred tax assets of Rs 150 lacs. However, in the previous year based on the estimated future earnings, the amount of deferred Tax Assets was re-calculated at Rs. 100 lacs. The Deferred Tax Amount has been recognised on the basis of past losses/unabsorbed Depreciation (as per the tax laws) which according to the Management has virtual certainty as to realisation. b)Current Taxation Provision of Income Tax (MAT) has been made under Section 115-JB of the Income Tax Act.

11 Related Party Disclosure: Related party as required by Accounting Standard—AS 18 Related Parties Disclosures" issued by the Institute of Chartered Accountants of India are given below:

(a) Key Management Personnel Mr.R.K.Gupta (Executive Director)

(b)Enterprises over which key Management personnel or his Nil

relatives are able to exercise significant influence.

(c) Holding Company Kashipur Holdings Ltd

(d) Other Related Parties (Associates)

1. Ajay Commercial Company (P) Ltd

2. Searock Credit (P) Ltd

3. India Glycols Ltd

4. SuDreet VvaDaar Pvt Ltd

12. Segment Reporting As Required By Accounting Standard-17

Presently the Business activity of the Company falls within a single primary business segment viz Industrial Gases as such the disclosure requirement of Accounting standard (AS) - 17" Segment Reporting" issued by the Institute of Chartered Accountants of India is not applicable.

13. Where the Fixed Assets were sold and no information as to its original value/ written down value was available, the sale value has been taken as gain considering the written down value as nil.

14. Previous Years figures have been regrouped/recast wherever found necessary to make them comparable with those of the current year.

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