Mar 31, 2018
1 Corporate Information
MARG Limited (the Company) was incorporated on December 16, 1994. The registered office of the Company is located at Marg Axis, 4/318, Rajiv Gandhi Salai, Kotivakkam, Chennai- 600 041. The Company is mainly engaged in the business of construction and real estate.
*Cash Credit are secured by inventories, advances, receivables and other current assets of specified projects, fixed deposit receipts and immovable properties.
Defaults on repayment of short-term loans.
Loan Of Rs 122.67 Crores is overdue for more than 90 days.
Term Loans and other secured loans are Secured by way of charge on rentals, mortgage / Hypothecation of movable and immovable properties.
Defaults on repayment of short-term loans and interest thereof
Short-term loans of Rs 920.24 Crores were overdue for a period of more than 90 days respectively
Note 2
a Estimated amount of liability on capital contracts : Rs 3.3 Crores (PY Rs 3.3 Crores)
b Corporate Guarantees given to Banks in respect of loans taken by other Companies : Rs 3247.67 Crs(PY Rs 3247.67 Crs)
c. Corporate Guarantees given to Banks in respect of performance bank guarantees issued by them : Rs 65.89 Crores ( Previous Year Rs c 71.69 Crores)
d. The company has imported capital goods at concessional rate of customs duty under the Export Promotion Credit Guarantee (EPCG) d scheme against submission of bank guarantees. In terms of the scheme, the company is obliged to export goods/ services of certain FOB value as specified in the said scheme. As at the year end, the company has the following unfulfilled export obligations under the scheme
e Claims not acknowledged as debts by the Company: Rs 106.21 Crores (Previous year Rs106.11 Crores). The Company is a party to several legal suits on construction contract terms related disputes, pending before various courts in India as well as arbitration proceedings. It is not possible to make a fair assessment of the likely financial impact of these pending disputes / litigations until the cases are decided by the appropriate authorities.
Note 3
a) The Company did not provided for interest for the year ended 31st March, 2018 on certain loans that are assigned to ARC, the management states that it negotiating with the ARC for revised terms and conditions and seeking for concession in terms of waiver/reduced rate of interest. Hence, the management is of the opinion considering such concessions it is appropriate not to charge an interest for the year ended 31st March 2018.
b) The company and Edelweiss ARC (EARC) agreed to restructure our debt repayment proposal. As a condition to the proposal, we have to allot Equity Shares on a Preferential allotment/Private placement basis for part debt convert to equity and balance to be realised by liquidating collateral assets offered over the period of time. On fulfilment of precedent conditions as per the above sanctions, definite agreement has to be executed. We have not provided interest on loans assigned to EARC during the Year.
Note 4 BORROWINGS FROM BANKS AND OTHERS:
a) The Cash credit, WCTL, FITL and other facilities provided by the consortium comprising of Indian Bank, Allahabad Bank, Oriental Bank of Commerce and Indian Overseas Bank are transferred to Edelweiss Asset Reconstruction Company Limited (ARC) on various dates. The outstanding balance in respect of these loans as per EARC Sanction amounts to Rs 904.63 Crs as on 31st March, 2018 in respect of these loans are included in ''Current Maturities of long term of borrowings'' in Note 23. The company didn''t provide for Interest on these loans during the year as explained in Note 28.
b) The South Indian Bank had taken possession of property of the Company situated at Thiruvanmiyur, having carrying cost of Rs 0.45 Crores and issued a tender-cum-auction sale notice in respect the short term loan as per EARC is Rs 14.51 Crores. The loan was assigned to Edelweiss ARC. The Company did not provide interest during the year as explained in Note 28.
c) State Bank of Mauritius Limited had assigned to the loan to Pegasus Assets Reconstruction Private Limited (''the ARC''). Since the revised terms of restructure with the ARC is yet to be finalised, the outstanding amount of Rs 20.81 Crores is included in Current Maturities of long term of borrowings in Note 23. The Company did not provide interest during the year as explained in Note 28. Subsequently, the ARC has issued notice under SARFAESI Act.
d) The Term loan sanctioned by Punjab National Bank was assigned to Edelweiss Asset Reconstruction Private Limited (ARC). The outstanding amount as per EARC is Rs 44.61 Crores are included in Current Maturities of long term of borrowings in Note 23. The company didn''t provide for Interest on this loan during the year as explained in Note 28.
e) SICOM Limited has given One time sanction for Rs 39.48 Crores of which of Rs 10 Crores settled. Sicom had persued legal steps for recovery of balance amount. Due to real estate market situation , we are finding difficult to liquidate. However, we are confident to settle them at the earliest.
f) IFCI Venture Capital Funds Ltd has recalled the term loan and issued possession notice under SARFASEI Act to the company in respect of outstanding dues of Rs 27.79 Crores as on 31st March, 18. Currently, the case is pending with Debts Recovery Tribunal, Chennai. IFCI has offered to sell the loan at Rs 12.50 Crores for which we are in process of identifying suitable investors.
g) ICICI Bank has filed case with Debts Recovery Tribunal, Chennai in respect of outstanding dues of Rs 65.96 Crores as on 31st March, 2018, which is pendin
h) L&T finance has moved to NCLT for the recovery of Rs 55 Lacs as full and final settlement of which will be partially realising by sale of Flats for approximately Rs 35 Lacs and balance to be paid in installments.
i) SREI outstanding across our group companies is under negotiation with them for settlement as a package which is expected to be concluded during financial year 2018-19.
Note 5 PREPARATION OF FINANCIAL STATEMENTS ON ''GOING CONCERN'' BASIS:
The Company has recorded a Net loss of Rs 12.85 Crores for the year ended 31st March 2018, Rs26.89 Crores for the year ended 31st March, 2017, Rs 16.98 Crores for the year ended 31st March, 2016, Rs 172.45 Crores for the year ended 31st March, 2015, Rs 263.82 Crores for the year ended 31st March, 2014 and Rs 36.04 Crores for the year ended 31st March, 2013. The Company has defaulted in the payments due to Banks, Financial Institutions and others towards principal and interest, statutory dues and payment to vendors. Further there were lower cash inflows from existing projects and some creditors have filed winding up petitions against the company. Management is confident that the Company will be able to generate profit and cash in future years and meet its financial obligation as they arise. The financial statements have been prepared on a going concern basis based on cumulative input of the following business potential and mitigating factors:
a) The EPC division of the Company- has local and international bids are being planned leveraging the experience gained through execution of Marine, Infrastructure and Industrial EPC.
b) Many of the EPC loans and corporate loans have been restructured and/or assigned to ARCs. The company intends to approach the ARCs for concessions in Inte
c) The Company is also in the process of generating cash through equity disinvestment in operating SPVs and realisation of advances given to subsidiaries which intends to commence new residential and plotted development projects.
d) The Company is also in the process of generating cash through equity disinvestment in operating SPVs and realisation of advances given to subsidiaries which have commenced new residential and plotted development projects.
Note INVESTMENT AND ADVANCE / RECEIVABLES DUE FROM SUBSIDIARY COMPANIES:
6 The company has invested in equity amounting to Rs 169.18 Crores (PY Rs 169.18 Crores) in New Chennai Township Private Limited, a wholly owned subsidiary as on 31st March, 2018. The Company has advanced an amount of Rs 352.58 Crores (PY Rs 335.72 Crores) as subordinated loan to the subsidiary and Rs 67.40 Crores (Rs 66.29 Crores) is carried forward as receivables as on 31st March, 2018. The said subsidiary has incurred losses which have resulted in negative net-worth as on 31st March, 2018. The subsidiary company has obtained valuation report for the assets of the company, from an approved valuer, which supports the carrying value of such investment and loan outstanding as on 31st March, 2018. The subsidiary company is exploring possibilities to revive the projects and generate cash flows. Accordingly, the financial statements of the subsidiary company have been prepared on ''Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st March, 2018.
7 The company has invested in equity amounting to Rs 136.72 Crores (PY Rs 136.72 Crores) in Riverside infrastructure (India) Private Limited, subsidiary of the company as on 31st March, 2018. The Company has advanced an amount of Rs 44.75 Crores (PY Rs 42.65 Crores) as subordinated loan to the subsidiary and Rs 59.74 Crores (PY Rs 59.74 Crores) is carried forward as receivables as on 31st March, 2018. The Mall project of the subsidiary continues to be suspended and the company defaulted in payments of dues to Banks/Financial Institutions towards principal and interest. The subsidiary company continues to discuss with strategic partners and is confident of generating cash flows. Accordingly, the financial statements of the subsidiary company have been prepared on ''Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st March, 2018.
8 The company has invested in equity amounting to Rs 54.05 Crores (PY Rs 54.05 Crores) in Marg Properties Limited, wholly owned subsidiary of the company as on 31st March, 2018.The Company has advanced an amount of Rs 42.87 Crores (PY Rs 42.74 Crores) as loan to the subsidiary and Rs 17.06 Crores (PY Rs 23.39 Crores) is carried forward as receivables as on 31st March, 2018. The subsidiary Company has negative net-worth as on 31st March, 2018. The loans of the company have been assigned to ARCs and the Management is confident that the Company will be able to generate cash from ongoing projects in future years and meet its financial obligation as they arise. Accordingly, the financial statements of the subsidiary company have been prepared on ''Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st Mar, 2018.
The Company has invested in equity amounting to Rs 0.24 Crores (PY Rs 0.24 Crores) and an amount of Rs 147.08 Crores (PY Rs 147.08 Crores) is advanced as loan to its subsidiaries/fellow subsidiaries and Rs 4.62 Crores (PY Rs 4.62 Crores) is carried forward as receivables as on 31st March 2018, which have provided land owned by them as security for the loans availed from lenders. As the borrowing company defaulted in repayment of such loans, the land owned by these subsidiaries may be attached/sold which may adversely affect the recoverability of the investment/advance. Howeverno such sale has been made by the banks and accordingly, the financial statements of such subsidiaries have been prepared on ''Going concern'' basis and management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from these subsidiaries as at 31st March, 2018.
Note 9
a) The company executed a construction contract at Agra for DG MAP, a project of the Government of India which is terminated during financial year 14-15. The company has receivables of Rs0.46 crores and work in progress of Rs13.99 Crores as on 31st March, 2018 relating to this project still continuing. Inventory of materials amounting to Rs2.01 Crores and plant and machinery amounting to Rs1.51 Crores as on 31st March, 2018 are withheld at site by the client. The management is confident that it will be able to recover the entire dues out of the arbitration process initiated by the company and that the above amount is considered good and recoverable and hence no provision is made as on 31st March 2018.
b) The company executed a construction contract at Dwaraka for M/s HSCC (India) Limited, a project of the Government of India, in respect of which the company has receivables of Rs 0.60 Crores and work in progress of Rs 0.67 Crores as on 31st March, 2018. The company has filed arbitration claim and based on the same a sum of Rs 0.40 Crores is written off in books, being the amount not included in claim made. The management is of the opinion that the rest of the amount is considered good and recoverable and hence no provision is made as on 31st March 2018.
c) The Work in progress inventory of company as on 31st March, 2018 includes Rs 9.71 Crores in respect of EPC work done by the company to one of its subsidiary companies which is unbilled as on 31st March, 2018 and Advances recoverable include management fee of Rs 4.8 Crores charged on the said subsidiary company which is not acknowledged by the subsidiary. The management is confident that these amounts are recoverable in the future and hence considers it appropriate to carry forward the amount of Rs 9.71 Crores as work in progress and Rs 4.8 Crores as receivables as on 31st March, 2018.
Note 10
The company had pledged shares held in Karaikal Port Private Limited (KPPL) for the loan availed by KPPL. The lending Bank invoked the pledge of 202392000 Equity shares in earlier years, having total carrying cost of Rs 202.39 crores as on 31st March, 2018. Edelweiss ARC has restructed KPPL loan whereby shares held by Marg Limited in KPPL will be reinstated thereupon will be pledged back to EARC. As per the EARC, they have to be allotted shares for their partial debt outstanding wherein post conversion, KPPL will not be a subsidiary of Marg Limited.
Note 11
The company could not obtain Balance Confirmation or statement of account from the lenders of certain equipment loans. Hence the reconciliation could not be carried out for the year ended 31st March 2018. The company has provided for interest at contractual rates.
Note 12
The company could not obtain Balance Confirmation or statement of account of Certain banks current/other accounts maintained with various banks since those bank accounts were attached by the Income tax investigation wing. The company has initiated necessary actions to uplift the attachment.
Note 13(b) INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to amounts unpaid as at the year end together with interest paid / payable under this Act have not been given.
Note 14
In the opinion of the Management, Current Assets, Loans & Advances have a value on realization equal to the amount at which they are stated in the Balance Sheet and provision for all known liabilities has been made.
NOTE 15 : SEGMENT REPORTING
As per Indian Accounting Standard on "Segment Reporting", segment information has been provided under the Notes to Consolidated Financial S
NOTE 16 : REMUNERATION TO DIRECTORS:
As the company has incurred losses for the Financial Year 2017-18 no remuneration is paid to the Managing Director. (Previous Year NIL).
NOTE 17 : NON-CASH TRANSACTIONS
Bank Guarantees invoked during the year amounting to Rs 5.92 Crores have been included in liability to banks as on 31st March 2018 and treated as Non cash transactions.
NOTE 18 : OPERATING LEASES
a) Cancelable Lease:
Total rental charges under cancelable operating lease was Rs 0.065 Crores year ended 31-Mar-18 (Previous year Rs 0.61 Crores).
NOTE 19 : INFORMATIONS PERSUANT TO SECTION 129(3) OF COMPANIES ACT 2013:
Information of salient features of financial statements of subsidiaries required under Section 129(3) of the Companies Act, 2013 -(a) capital (b) reserves (c) total assets (d) total liabilities (e) details of investments (except in case of investment in subsidiaries) (f) turnover (g) profit (loss) before taxation (h) provision for taxation (i) profit (loss) after taxation and (j) proposed dividend for each subsidiary is furnished in Annexure B to the accounts.
NOTE 20 : INFORMATIONS PERSUANT TO REGULATION 34 (3) OF SEBI(LODR) REGULATION 2015
Disclosure as required by Regulation 34(3) of the SEBI (LODR) regulations 2015 for loans and advances given by the company are given in Annexure A.
NOTE 21 : INFORMATIONS PERSUANT TO PART II OF SCHEDULE III OF COMPANIES ACT:
The activities of the company are not capable of being expressed in any generic unit and hence, it is not possible to give the quantitative details required under Paragraphs 3, 4C and 4D of Part II of Schedule III of the Companies Act 2013.
NOTE 22 : PRESENTATION OF PREVIOUS YEAR''S FIGURE
Previous year''s figures have been regrouped / reclassified / rearranged wherever necessary to bring them in conformity with the current year figures.
Note 23- First time adoption of Ind AS
These standalone IND AS financial statements, for the year ended March 31 2018 have been prepared in accordance with Ind AS. For the purpose of transition to Ind AS, the company has complied with Ind AS 101
- "First time adoption of Indian Accounting
Standards" for exemptions and exceptions, on transition date (i.e. April 1, 2016) and Indian GAAP is the previous GAAP followed by the company. The transition to Ind AS has resulted in changes in the presentation of financial statements, disclosures in the notes and accounting policies and principles. The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended March 31, 2018 and the comparative information.
Exceptions
Deemed cost for investments in Subsidiaries, associates and Other entities: The company has elected to continue with the carrying value for all its investments in subsidiaries and associates as of April 1, 2016 measured under Indian GAAP as deemed cost as of April 1, 2016 (transition date)
Deemed Cost for Property,Plant and Equipment and Investment Property. The company has elected to continue with the carrying value of Property, Plant and Equipment and Investment Property measured under Indian GAAP as deemed cost as of April 1 2017( transition date)
Note 24- First time adoption of Ind AS
These standalone IND AS financial statements, for the year ended March 31 2018 have been prepared ii accordance with Ind AS. For the purpose of transition to Ind AS, the company has complied with Ind AS 10''
- "First time adoption of Indian Accounting
Standards" for exemptions and exceptions, on transition date (i.e. April 1, 2016) and Indian GAAP is thi previous GAAP followed by the company. The transition to Ind AS has resulted in changes in th presentation of financial statements, disclosures in the notes and accounting policies and principles. Th accounting policies set out in Note 2 have been applied in preparing the financial statements for the yea ended March 31, 2018 and the comparative information.
Exceptions
Deemed cost for investments in Subsidiaries, associates and Other entities: The company has elected to continue with the carrying value for all its investments in subsidiaries and associates as of April 1, 2016 measured under Indian GAAP as deemed cost as of April 1, 2016 (transition date)
Deemed Cost for Property, Plant and Equipment and Investment Property. The company has elected to continue with the carrying value of Property, Plant and Equipment and Investment Property measured under Indian GAAP as deemed cost as of April 1 2017( transition date).
Mar 31, 2016
1. Repayment Terms (including current maturities) of Secured Loans:*
Term Loans from Banks & Financial Institutions:
a) Loan of Rs, 62.75 Crores and Rs, 7.04 Crores payable in 84 monthly installments ending Mar-22 and Jun-25 respectively.
2. Repayment Terms (including current maturities) of unsecured Loans:
a) Loan of Rs, 0.99 crores payable in 1 monthly installments ending Mar-18 *excludes loans recalled
3. Defaults on repayment of Long-term Loans and Interest thereof:
Long term loans of Rs, 2.11 Crores (PY 0.68 Crores) and Rs, 937.35 Crores (PY 849.99 Crores) were overdue for a period of less than 90 days and more than 90 days respectively. Interest of Rs, 11.77 Crores (PY 37.07 Crores) and Rs, 214.92 (PY 153.98 Crores) were overdue for a period of less than 90 days and more than 90 days respectively.
4. Defaults on repayment of Short-term Loans and Interest thereof:
Short term loans of Rs Nil (PY Rs, 16.33 Crores) and Rs, 241.14 Crores (PY Rs, 247.65 Crores) were overdue for a period of less than 90 days and more than 90 days respectively. Interest aggregating to Rs, 3.06 Crores (PY Rs, 9.15 Crores) and Rs, 44.81 Crores (PY Rs, 22.08 Crores) were overdue for a period of less than 90 days and more than 90 days respectively.
NOTE 5 : BORROWINGS FROM BANKS AND OTHERS
The company did not provide for interest of Rs, 154.98 Crores, for the year ended 31st March, 2016, on certain loans transferred to ARC. The management states that it is negotiating with the ARC for revised terms and conditions and is seeking for concessions in terms of waiver/reduced rate of interest. Hence, the management is of the opinion that considering such concessions it is appropriate not to charge interest of Rs, 154.98 Crores for the year ended 31st March, 2016
NOTE 6 : BORROWINGS FROM BANKS AND OTHERS:
a) The Cash credit, WCTL, FITL and other facilities provided by the consortium comprising of Indian Bank, Allahabad Bank, Oriental Bank of Commerce and Indian Overseas Bank are transferred to Edelweiss Asset Reconstruction Company Limited (ARC) on various dates. The outstanding balance in respect of these loans amounting to Rs, 634.08 Crs as on 31st March, 2016 in respect of these loans are included in ''Current Maturities of long term of borrowings'' in Note 10. The company didn''t provide for Interest on these loans during the year as explained in Note 28. Indian Bank has filed case with Debts Recovery Tribunal, Chennai which is pending.
b) The South Indian Bank had taken possession of property of the Company situated at Thiruvanmiyur, having carrying cost of Rs, 0.45 Crores and issued a tender-cum-auction sale notice in respect the short term loan of Rs, 15 Crores. The loan was assigned to Edelweiss ARC. Since the revised terms of restructure with the ARC is yet to be finalized, the Company continues to provide interest at the rates originally charged by the Bank. Currently, the case is pending with Debts Recovery Tribunal, Chennai.
c) State Bank of Mauritius Limited had assigned to the loan to Pegasus Assets Reconstruction Private Limited (Rs,the ARC''). Since the revised terms of restructure with the ARC is yet to be finalized, the outstanding amount of Rs, 20.81 Crores is included in Current Maturities of long term of borrowings in Note 10 and the Company continues to provide interest at the rates originally charged by the Bank. Subsequently, the ARC has issued notice under SARFAESI Act. Currently, the case is pending with Debts Recovery Tribunal, Chennai.
d) The Term loan sanctioned by Punjab National Bank was assigned to Edelweiss Asset Reconstruction Private Limited (ARC). The outstanding amount of Rs, 41.13 Crores are included in Current Maturities of long term of borrowings in Note 10. The company didn''t provide for Interest on this loan during the year as explained in Note 28.
e) SICOM Limited had issued notice SARFAESI Act and winding up notice under section 434 of Companies Act, 1956 in respect of the term loan and interest amounting to Rs, 62.46 Crores.
f) State Bank of Hyderabad has issued possession notice under SARFAESI Act for cash credit facility of Rs, 9.80 crores outstanding as on 31st March 2016.
g) IFCI Venture Capital Funds Ltd has recalled the term loan and issued possession notice under SARFASEI Act to the company in respect of outstanding dues of Rs, 21.39 Crores as on 31st March, 2016. Currently, the case is pending with Debts Recovery Tribunal, Chennai.
h) ICICI Bank has filed case with Debts Recovery Tribunal, Chennai in respect of outstanding dues of Rs, 58.40 Crores as on 31st March, 2016, which is pending and issued notice to invoke pledge of shares in one of the subsidiary companies.
i) The equipment loan of Rs, 1.44 Crores(including interest) as on 31st March, 2016 was recalled by L&T Finance Ltd during the year,
j) The equipment loan of Rs, 85.50 (including interest) as on 31st March, 2016 was recalled by SREI Equipment Finance Ltd.
NOTE 7 : PREPARATION OF FINANCIAL STATEMENTS ON GOING CONCERNâ BASIS:
The Holding Company has recorded a Net Loss of Rs,16.98 Crores for the year ended 31st March, 2016, Rs, 172.45 Crores for the year ended 31st March, 2015, Rs, 263.82 Crores for the year ended 31st March, 2014 and '' 36.04 Crores for the year ended 31st March, 2013. The Company has defaulted in the payments due to Banks, Financial Institutions and others towards principal and interest, statutory dues and payment to vendors. Further there were lower cash inflows from existing projects and some creditors have filed winding up petitions against the company. Management is confident that the Company will be able to generate profit and cash in future years and meet its financial obligation as they arise. The financial statements have been prepared on a going concern basis based on cumulative input of the following business potential and mitigating factors:
a) The EPC division of the Company has an order book of Rs, 2586.18 Crores. Further local and international bids are being planned leveraging the experience gained through execution of Marine, Infrastructure and Industrial EPC.
b) Many of the EPC loans and corporate loans have been restructured and/or assigned to ARCs. The company intends to approach the ARCs for concessions in Interest and restructuring of loans. The management is confident that it will help the company to focus on projects in hand and generate cash flows.
c) The Company is also in the process of generating cash through equity disinvestment in operating SPVs and realization of advances given to subsidiaries which intends to commence new residential and plotted development projects.
d) The Company is also in the process of generating cash through equity disinvestment in operating SPVs and realization of advances given to subsidiaries which have commenced new residential and plotted development projects.
NOTE 8.: INVESTMENT AND ADVANCE/RECEIVABLES DUE FROM SUBSIDIARY COMPANIES
1) The company has invested in equity amounting to Rs, 169.18 Crores (PY Rs, 169.18 Crores) in New Chennai Township Private Limited, a wholly owned subsidiary as on 31st March, 2016. The Company has advanced an amount of Rs, 309.27 Crores (PY Rs, 272.81 Crores) as subordinated loan to the subsidiary and Rs, 59.26 Crores (Rs, 58.26 Crores) is carried forward as receivables as on 31st March, 2016. The said subsidiary has incurred losses which have resulted in negative net-worth as on 31st March, 2016. The subsidiary company has obtained valuation report for the assets of the company, from an approved valuer, which supports the carrying value of such investment and loan outstanding as on 31st March, 2015. The subsidiary company is exploring possibilities to revive the projects and generate cash flows. Accordingly, the financial statements of the subsidiary company have been prepared on Rs,Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st March, 2016.
9) The company has invested in equity amounting to Rs, 136.72 Crores (PY Rs, 136.72 Crores) in Riverside infrastructure (India) Private Limited, subsidiary of the company as on 31st March, 2016. The Company has advanced an amount of Rs, 39.81 Crores (PY Rs, 35.42 Crores) as subordinated loan to the subsidiary and Rs, 59.74 Crores (PY Rs, 59.74 Crores) is carried forward as receivables as on 31st March, 2016. The Mall project of the subsidiary continues to be suspended and the company defaulted in payments of dues to Banks/Financial Institutions towards principal and interest. The subsidiary company continues to discuss with strategic partners and is confident of generating cash flows. Accordingly, the financial statements of the subsidiary company have been prepared on ''Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st March, 2016.
10) The company has invested in equity amounting to Rs, 54.05 Crores (PY Rs, 54.05 Crores) in Marg Properties Limited, wholly owned subsidiary of the company as on 31st March, 2016.The Company has advanced an amount of Rs, 37.82 Crores (PY Rs, 31.33 Crores) as loan to the subsidiary and Rs, 17.13 Crores (PY Rs, 13.74 Crores) is carried forward as receivables as on 31st March, 2016. The subsidiary Company has negative net-worth as on 31st March, 2016. The loans of the company have been assigned to ARCs and the Management is confident that the Company will be able to generate cash from ongoing projects in future years and meet its financial obligation as they arise. Accordingly, the financial statements of the subsidiary company have been prepared on ''Going concern'' basis and the management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from the said subsidiary company as at 31st Mar, 2016.
11) The Company has invested in equity amounting to Rs, 0.15 Crores (PY Rs, 0.14 Crores) and an amount of Rs, 135.37 Crores (PY Rs, 118.31 Crores) is advanced as loan to its subsidiaries/fellow subsidiaries and Rs, 4.62 Crores (PY Rs, 4.38 Crores) is carried forward as receivables as on 31st March 2016, which have provided land owned by them as security for the loans availed from lenders. As the borrowing company defaulted in repayment of such loans, the land owned by these subsidiaries may be attached/sold which may adversely affect the recoverability of the investment/advance. However no such sale has been made by the banks and accordingly, the financial statements of such subsidiaries have been prepared on ''Going concern'' basis and management is of the opinion that no provision is considered necessary at this stage in respect of investments, loans and receivables outstanding from these subsidiaries as at 31st March, 2016.
NOTE 12
a) The company''s land of 0.864 acres having a carrying cost of Rs, 78,26,027/- as on 31st March, 2016 was provided as security for loans taken by the company. The company has defaulted in repayment of such loans; consequently the aforesaid property of the company is subject to attachment / sale by the lenders. The Company has received possession notice under SARFAESI Act/Notice of Sale under Security Interest Enforcement Rules, 2002 in respect the said land.
NOTE 13
a) The company executed a construction contract at Agra for DG MAP, a project of the Government of India which is terminated during last financial year. The company has receivables of Rs, 0.46 crores and work in progress of Rs, 13.99 Crores as on 31st March, 2016 relating to this project. Inventory of materials amounting to Rs, 2.01 Crores and plant and machinery amounting to Rs, 1.99 Crores as on 31st March, 2016 are withheld at site by the client. The management is confident that it will be able to recover the entire dues out of the arbitration process initiated by the company and that the above amount is considered good and recoverable and hence no provision is made as on 31st March 2016.
b) The company executed a construction contract at Dwaraka for M/s HSCC (India) Limited, a project of the Government of India, in respect of which the company has receivables of Rs, 0.60 Crores and work in progress of Rs, 0.69 Crores as on 31st March, 2016. The company has filed arbitration claim and based on the same a sum of Rs, 0.40 Crores is written off in books, being the amount not included in claim made. The management is of the opinion that the rest of the amount is considered good and recoverable and hence no provision is made as on 31st March 2016.
c) The company has filed arbitration claim for some other projects, in respect of which there is balance of Rs, 10.76 Crores of receivables, Rs, 8.77 Crores of inventory/Work in progress as on 31st March, 2016. The management is of the opinion that no provision is required considering that the claim made is higher than the balance lying in books as on 31st March, 2016.
NOTE 14
The Work in progress inventory as on 31st March, 2016 includes Rs, 53.92 Crores in respect of EPC work done by the company to one of its subsidiary companies which is unbilled as on 31st March, 2016 and Advances recoverable include management fee of Rs,4.8 Crores charged on the said subsidiary company which is not acknowledged by the subsidiary. The management is confident that these amounts are recoverable in the future and hence considers it appropriate to carry forward the amount of Rs, 53.92 Crores as work in progress and Rs, 4.8 Crores as receivables as on 31st March, 2016.
NOTE 15
The company had pledged shares held in Karaikal Port Private Limited (KPPL), subsidiary of the company for the loan availed by KPPL. The lending Bank invoked the pledge of 16,44,90,000 equity shares and 37,90,000 compulsorily convertible preference shares during the previous year, having total carrying cost of Rs, 202.39 crores as on 31st March, 2016. The Company filed a writ petition in the Hon''ble High Court of Madras challenging the invocation. The Hon''ble High Court passed interim order dated 25th March, 2015, restraining the Bank from further transferring/encumbering of the shares and also status quo prevailing of the management of the Subsidiary, until further orders. The company signed a ''Non-binding term sheet'' with a prospective investor whereby the investor will subscribe to hold 51% of the fully diluted share capital of KPPL, which the company has submitted before the Hon''ble High Court. The Hon''ble High Court has extended the stay by an Interim order dated 26th April, 2016 and the same is in force as on date. In view of the Interim order of the Hon''ble High Court and Articles of Association/Shareholders Agreement of KPPL, the management considers it appropriate to carry forward the amount of Rs, 202.39 Crores as Investments and no provision is required to be made as on 31st March, 2016.Consequently, KPPL is continued to be classified as a subsidiary of the company in the accounts for the year ended 31st March, 2016 and the accounts of the said subsidiary company have been included in the Consolidated Financial Statements for the year ended 31st March, 2016
NOTE 16
The company could not obtain Balance Confirmation or statement of account from the lenders of certain equipment loans. Hence the reconciliation could not be carried out for the year ended 31st March 2015 & 31st March, 2016. The company has provided for interest at contractual rates.
NOTE 17: EXCEPTIONAL ITEMS
In accordance with the requirements of Schedule II to the Companies Act, 2013, the Company has re-assessed the useful lives of the depreciable assets. The depreciation for the year ended 31st March,2015 is higher by Rs, 11.06 Crores due to change in useful lives. The Exceptional Item of Rs, 0.34 Crores in the Statement of Profit or Loss for the year ended 31st March 2015 represents the amount charged off in respect of assets whose remaining useful life is nil as at 01st April, 2014.
NOTE 18 : INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures relating to amounts unpaid as at the yearend together with interest paid / payable under this Act have not been given.
NOTE 20:
In the opinion of the Management, Current Assets, Loans & Advances have a value on realization equal to the amount at which they are stated in the Balance Sheet and provision for all known liabilities has been made.
NOTE 21 : SEGMENT REPORTING
As per Accounting Standard (AS) 17 on "Segment Reporting", segment information has been provided under the Notes to Consolidated Financial Statements.
NOTE 22 : REMUNERATION TO DIRECTORS
As the company has incurred losses for the Financial Year 2015-16 no remuneration is paid to the Managing Director. (Previous Year Nil)
NOTE 23 : INFORMATIONS PURSUANT TO SECTION 129(3) OF COMPANIES ACT
Information of (a) capital (b) reserves (c) total assets (d) total liabilities (e) details of investments (except in case of investment in subsidiaries) (f) turnover (g) profit (loss) before taxation (h) provision for taxation (i) profit (loss) after taxation and (j) proposed dividend for each subsidiary is furnished in Annexure B to the accounts.
NOTE 24 : INFORMATIONS PURSUANT TO CLAUSE 32 OF LISTING AGREEMENT
Disclosure as required by Clause 32 of listing agreement with stock exchanges for loans and advances given by the company are given in Annexure A.
NOTE 25 : INFORMATIONS PURSUANT TO PART II OF SCHEDULE III OF COMPANIES ACT
The activities of the company are not capable of being expressed in any generic unit and hence, it is not possible to give the quantitative details required under Paragraphs 3, 4C and 4D of Part II of Schedule III of the Companies Act 2013.
NOTE 26: PRESENTATION OF PREVIOUS YEAR''S FIGURES
Previous year''s figures have been regrouped / reclassified / rearranged wherever necessary to bring them in conformity with the current year figures.
Mar 31, 2015
1.1 Repayment Terms (including current maturities) of Secured Loans:*
Term Loans from Banks & Financial Institutions:
a) Loan of Rs, 70.27 crores payable in 123 monthly installments ending
Mar-22
b) Vehicle Loan of Rs, 0.17 crores payable in 15 monthly installments
ending June-16
Term Loans from Others:
a) Equipment Loan of Rs, 70.35 crores payable in 32 monthly
installments ending Nov-17
b) Equipment Loan of Rs, 1.39 crores payable in 27 monthly installments
ending Jun-17
1.2 Repayment Terms (including current maturities) of unsecured Loans:
a) Loan of Rs, 0.99 crores payable in 1 monthly installments ending
Mar-18 *excludes loans recalled
1.3 Defaults on repayment of Long-term Loans and Interest thereof:
Long term loans of Rs, 0.68 Crores (PY 188.30 Crores) and Rs, 849.99
Crores (PY 66.82 Crores) were overdue for a period of less than 90 days
and more than 90 days respectively. Interest of Rs, 37.07 (PY 27.24
Crores) and Rs, 153.98 (PY 17.24 Crores) were overdue for a period of
less than 90 days and more than 90 days respectively.
1.4 Defaults on repayment of Short-term Loans and Interest thereof:
Short term loans of Rs 16.33 Crores (PY Rs, 32.50 Crores) and Rs,
247.65 Crores (PY Rs, 15 Crores) were overdue for a period of less than
90 days and more than 90 days respectively. Interest aggregating to Rs,
9.15 Crores (PY Rs, 4.42 Crores) and Rs, 22.08 Crores (PY Rs, 4.12
Crores) were overdue for a period of less than 90 days and more than 90
days respectively.
NOTE 2 : CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts: Rs, 3.6 Crores
(Previous year Rs, 2.88 Crores)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies: Rs, 3,247.67 Crores (Previous year Rs, 3,290.54
Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs, 104.45 Crores (Previous year Rs, 159.16
Crores)
d. The company has imported capital goods at concessional rate of
customs duty under the Export Promotion Credit Guarantee (EPCG) scheme
against submission of bank guarantees. In terms of the scheme, the
company is obliged to export goods/services of certain FOB value as
specified in the said scheme. As at the year end, the company has the
following unfulfilled export obligations under the scheme. As at the
year end, the company has the following unfulfilled export obligations
under the scheme:
NOTE 3 : BORROWINGS FROM BANKS AND OTHERS EPC Consortium Loans:
a) Indian Bank and Allahabad Bank have issued notice under SARFAESI
Act, during the year. The outstanding balance in respect of the WCTL
and FITL amounting to Rs, 343.38 Crores as on 31st March, 2015 is
included in 'Current Maturities of Long term borrowings' in Note 10.
b) Indian Overseas Bankhas assigned the entire loan to Edelweiss Asset
Reconstruction Company Limited (ARC). Since the revised terms of
restructure with the ARC is yet to be finalised, the outstanding
balance in respect of the WCTL and FITL amounting to Rs, 184.24 Crores
as on 31st March, 2015 in respect of these loans are included in
'Current Maturities of long term of borrowings' in Note 10 and the
Company continues to provide interest at the rates originally charged
by the Banks.
c) Oriental Bank of Commerce recalled the entire term loans and cash
credit facilities during the year. The outstanding balance in respect
of the WCTL and FITL amounting to Rs, 81.39 Crores as on 31st March,
2015 is included in 'Current Maturities of Long term borrowings' in
Note 10.
Corporate Loans:
d) ICICI Bank has recalled the term loan and interest amounting to Rs,
50.29 Crores during the year.
e) Punjab National Bank had recalled the term loan, subsequent to which
the loan was assigned to Edelweiss Asset Reconstruction Private Limited
(ARC). Since the revised terms of restructure with the ARC is yet to be
finalized, the outstanding amount of Rs, 41.13 Crores are included in
Current Maturities of long term of borrowings in Note 10 and the
Company continues to provide interest at the rates originally charged
by the Banks.
f) The South Indian Bank had taken possession of property of the
Company situated at Thiruvanmiyur, having carrying cost of Rs, 0.45
Crores and issued a tender-cum-auction sale notice for the short term
loan of Rs, 15 Crores. Subsequently the loan was assigned to Pegasus
Assets Reconstruction Private Limited ('the ARC'). Since the revised
terms of restructure with the ARC is yet to be finalized, the Company
continues to provide interest at the rates originally charged by the
Bank.
g) State Bank of Mauritius Limited had assigned to the loan to Pegasus
Assets Reconstruction Private Limited ('the ARC').
Since the revised terms of restructure with the ARC is yet to be
finalized, the outstanding amount of Rs, 20.81 Crores is included in
Current Maturities of long term of borrowings in Note 10 and the
Company continues to provide interest at the rates originally charged
by the Bank. Subsequently, the ARC has issued notice under SARFAESI
Act.
h) SICOM Limited has issued notice SARFAESI Act in respect of the term
loan and interest amounting to Rs, 53.28 Crores during the year.
i) State Bank of Hyderabad has issued notice under SARFAESI Act for
cash credit facility of Rs, 9.00 crores outstanding as on 31st March
2015.
j) Equipment loan of Rs, 1.74 Crores has been restructured during the
year, with a tenure of 2.5 years, with repayment starting from
February, 2015
NOTE 4 : PREPARATION OF FINANCIAL STATEMENTS ON 'GOING CONCERN' BASIS
The Holding Company has recorded a Net Loss of Rs, 172.45 Crores for
the year ended 31st March, 2015 and Rs, 263.82 Crores for the year
ended 31st March, 2014 and Rs, 36.04 Crores for the year ended 31st
March, 2013. The Company has defaulted in the payments due to Banks,
Financial Institution and others towards principal and interest,
statutory dues and payment to vendors. Further there were lower cash
inflows from existing projects and some creditors have filed winding up
petitions against the company. Management is confident that the
Company will be able to generate profit and cash in future years and
meet its financial obligation as they arise. The financial statements
have been prepared on a going concern basis based on cumulative input
of the following business potential and mitigating factors:
a) The EPC division of the Company has an order book of Rs, 2683.48
Crores. Further local and international bids are being planned
leveraging the experience gained through execution of Marine,
Infrastructure and Industrial EPC.
b) Many of the EPC loans and corporate loans have been restructured
and/or assigned to ARCs. Hence the management is confident that it will
help the company to focus on projects in hand and generate cash flows.
c) The Company construction equipment to execute the projects on hand
and with the work experience to its credit is eligible to undertake new
projects.
d) The Company is also in the process of generating cash through equity
disinvestment in operating SPVs and realization of advances given to
subsidiaries which have commenced new residential and plotted
development projects.
NOTE 5 : INVESTMENT AND ADVANCE/RECEIVABLES DUE FROM SUBSIDIARY
COMPANIES
1) The company has invested in equity amounting to Rs, 169.18 Crores
(PY Rs, 169.18 Crores) in New Chennai Township Private Limited, a
wholly owned subsidiary as on 31st March, 2015. The Company has
advanced an amount of Rs, 272.81 Crores (PY Rs, 237.93 Crores) as
subordinated loan to the subsidiary and Rs, 58.26 (Rs, 57.32 Crores) is
carried forward as receivables as on 31st March, 2015. The said
subsidiary has incurred losses which have resulted in negative
net-worth as on 31st March, 2015. The subsidiary company has obtained
valuation report for the assets of the company, from an approved value,
which supports the carrying value of such investment and loan
outstanding as on 31st March, 2015. The subsidiary company is exploring
possibilities to revive the projects and generate cash flows.
Accordingly, the financial statements of the subsidiary company have
been prepared on 'Going concern' basis and the management is of the
opinion that no provision is considered necessary at this stage in
respect of investments, loans and receivables outstanding from the said
subsidiary company as at 31st March, 2015.
2) The company has invested in equity amounting to Rs, 136.72 Crores
(PY Rs, 136.72 Crores) in Riverside infrastructure (India) Private
Limited, subsidiary of the company. The Company has advanced an amount
of Rs, 35.42 Crores (PY Rs, 28.59 Crores) as subordinated loan to the
subsidiary and Rs, 59.74 Crores (PY Rs, 59.74 Crores) is carried
forward as receivables as on 31st March, 2015. The Mall project of the
subsidiary continues to be suspended and the company defaulted in
payments of dues to Banks/Financial Institutions towards principal and
interest. The subsidiary company is discussing with strategic partners
and is confident of generating cash flows. Accordingly, the financial
statements of the subsidiary company have been prepared on 'Going
concern' basis and the management is of the opinion that no provision
is considered necessary at this stage in respect of investments, loans
and receivables outstanding from the said subsidiary company as at 31st
March, 2015.
3) The company has invested in equity amounting to Rs, 54.05 Crores (PY
Rs, 54.05 Crores) in Marg Properties Limited, wholly owned subsidiary
of the company. The Company has advanced an amount of Rs, 31.33 Crores
(PY Rs, 33.84 Crores) as loan to the subsidiary and Rs, 13.74 Crores
(PY Rs, 11.94 Crores) is carried forward as receivables as on 31st
March, 2015. The Company has negative net-worth as on 31st March, 2015.
The loans of the company have been restructured by Banks and the
Management is confident that the Company will be able to generate
profit from its projects and cash in future year and meet its financial
obligation as they arise. Accordingly, the financial statements of the
subsidiary company have been prepared on 'Going concern' basis and the
management is of the opinion that no provision is considered necessary
at this stage in respect of investments, loans and receivables
outstanding from the said subsidiary company as at 31st March, 2015.
4) The Company has invested in equity amounting to Rs, 0.14 Crores (PY
Rs, 0.14 Crores) and an amount of Rs, 118.31 Crores (PY Rs, 107.92
Crores) is advanced as loan to its subsidiaries/fellow subsidiaries and
Rs, 4.38 Crores (PY Rs, 4.38 Crores) is carried forward as receivables
as on 31st March 2015, which have provided land owned by them as
security for the loans availed from lenders. As the borrowing company
defaulted in repayment of such loans, the land owned by these
subsidiaries may be attached/sold which may adversely affect the
recoverability of the investment/advance. However no such sale has been
made by the banks and accordingly, the financial statements of such
subsidiaries have been prepared on 'Going concern' basis and management
is of the opinion that no provision is considered necessary at this
stage in respect of investments, loans and receivables outstanding from
these subsidiaries as at 31st March, 2015.
NOTE 6.
a) The company executed a construction contract at Agra for DG MAP, a
project of the Government of India which is terminated during last
financial year. The company has receivables of Rs, 0.46 crores and work
in progress of Rs, 13.99 Crores as on 31st March, 2015 relating to this
project. Inventory of materials amounting to Rs, 2.01 Crores and plant
and machinery amounting to Rs, 1.99 Crores as on 31st March, 2015 are
withheld at site by the client. The management is confident that it
will be able to recover the entire dues out of the arbitration process
initiated by the company and that the above amount is considered good
and recoverable and hence no provision is made as on 31st March, 2015.
b) The company executed a construction contract at Dwaraka for M/s HSCC
(India) Limited, a project of the Government of India, in respect of
which the company has receivables of Rs, 0.60 Crores and work in
progress of Rs, 0.69 Crores as on 31st March, 2015. The company has
filed arbitration claim during the year and based on the same a sum of
Rs, 0.40 Crores is written off in books, being the amount not included
in claim made. The management is of the opinion that the rest of the
amount is considered good and recoverable and hence no provision is
made as on 31st March 2015.
c) The company has filed arbitration claim for some other projects, in
respect of which there is balance of Rs, 7.04 Crores of receivables,
Rs, 11.16 Crores of inventory/Work in progress as on 31st March, 2015.
The management is of the opinion that no provision is required
considering that the claim made is higher than the balance lying in
books as on 31st March, 2015.
NOTE 7.
The Work in progress inventory as on 31st March, 2015 includes Rs,
53.92 Crores in respect of EPC work done by the company to one of its
subsidiary company, which is pending completion. The management is
confident that these projects will be completed in the near future and
hence considers it appropriate to carry forward the amount of Rs, 53.92
Crores as work in progress as on 31st March, 2015.
NOTE 8.
The company had pledged shares held in Karaikal Port Private Limited
(KPPL), subsidiary of the company for the loan availed by the
subsidiary company. The lending Bank invoked the pledge of 16,44,90,000
equity shares and 37,90,000 compulsorily convertible preference shares
during the year, having total carrying cost of Rs, 202.39 crores as on
31st March, 2015. The Company filed a writ petition in the Hon'ble High
Court of Madras challenging the invocation. The Hon'ble High court
passed interim order dated 25-03-2015, restraining the Bank from
further transferring/encumbering of the shares and also status quo
prevailing of the management of the Subsidiary, until further orders.
In view of this, the management considers it appropriate to carry
forward the amount of Rs, 202.39 Crores as Investments and no provision
is required to be made as on 31st March, 2015. Consequently, KPPL is
continued to be classified as a subsidiary of the company in the
accounts for the year ended 31st March, 2015.
NOTE 9.
In respect of the equipment loan availed by the company there is
un-reconciled amount of Rs, 6.52 crores and the reconciliation of the
loan account is under process. The management is of the opinion that
the reconciliation will be completed very soon.
NOTE 10: EXCEPTIONAL ITEMS
In accordance with the requirements of Schedule II to the Companies
Act, 2013, the Company has re-assessed the useful lives of the
depreciable assets. The depreciation for the year ended 31st March,2015
is higher by Rs, 11.06 Crores due to change in useful lives. The
Exceptional Item of Rs, 0.34 Crores in the Statement of Profit or Loss
represents the amount charged off in respect of assets whose remaining
useful life is nil as at 01st April, 2014.
NOTE 11 : INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES
DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006 and hence disclosures relating to amounts unpaid as at the yearend
together with interest paid / payable under this Act have not been
given.
NOTE 12 :
In the opinion of the Management, Current Assets, Loans & Advances have
a value on realization equal to the amount at which they are stated in
the Balance Sheet and provision for all known liabilities has been
made.
NOTE 13: SEGMENT REPORTING
As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
NOTE 14 : REMUNERATION TO DIRECTORS
As the company has incurred losses for the Financial Year 2014-15 no
remuneration is paid to the Managing Director. (Previous Year Nil)
NOTE 15: NON-CASH TRANSACTIONS
Bank Guarantees and SBLC invoked/devolved during the year amounting to
Rs, 121.54 Crores have been included in liability to banks as on 31st
March 2015 and treated as Non cash transactions.
NOTE 16 : CASH & CASH EQUIVALENTS
Cash & Cash Equivalents include the following which are not available
for ready use by the Company as at the Balance Sheet date:
NOTE 17 : RELATED PARTY DISCLOSURES
A.List of subsidiaries, where control existed during the Period -
Annexure A
B. Associates:
Rajakamanglam Thurai Fishing Harbour Private Limited
C. Key Management Personnel (KMP)
G R K Reddy-Chairman & Managing Director (CMD)
D. Relative of Key Management Personnel
1. V P Rajini Reddy-wife of the CMD
2. G Raghava Reddy-father of the CMD
E. Entities over which KMP and/or their relatives exercise control:
1. Akshya Infrastructure Private Limited
2. Avinash Constructions Private Limited
3. Exemplarr Worldwide Limited
4. Jeevan Habitat Private Limited
5. Marg Capital Markets Limited
6. Marg Foundation
7. Noble Habitat Private Limited
8. Swarnabhoomi Academic Institutions
F. Entities over which KMP and/or their relatives exercise significant
influence:
1. Global Infoserv Limited
2. Marg Digital Infrastructure Private Limited
3. Marg Projects and Infrastructure Limited
4. Marg Realities Limited
NOTE 18 : INFORMATIONS PURSUANT TO SECTION 212(8) OF COMPANIES ACT
Information of (a) capital (b) reserves (c) total assets (d) total
liabilities (e) details of investments (except in case of investment in
subsidiaries) (f) turnover (g) profit (loss) before taxation (h)
provision for taxation (i) profit (loss) after taxation and (j)
proposed dividend for each subsidiary is furnished in Annexure B to the
accounts.
NOTE 19 : INFORMATIONS PURSUANT TO CLAUSE 32 OF LISTING AGREEMENT
Disclosure as required by Clause 32 of listing agreement with stock
exchanges for loans and advances given by the company are given in
Annexure A.
NOTE 20 : INFORMATIONS PURSUANT TO PART II OF SCHEDULE VI OF COMPANIES
ACT
The activities of the company are not capable of being expressed in any
generic unit and hence, it is not possible to give the quantitative
details required under Paragraphs 3, 4C and 4D of Part II of Schedule
VI of the Companies Act 1956.
NOTE 21 : PRESENTATION OF PREVIOUS YEAR'S FIGURES
Previous year's figures have been regrouped / reclassified / rearranged
wherever necessary to bring them in conformity with the current year
figures.
Mar 31, 2014
NOTE 1 : CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts: Rs. 2.88 Crores
(Previous year Rs. 2.92 Crores)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies: Rs. 3,290.54 Crores (Previous year Rs. 3,170.22 Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs. 159.16 Crores (Previous year Rs. 175.58
Crores)
d. The company has imported capital goods at concessional rate of
customs duty under the Export Promotion Credit Guarantee (EPCG) scheme
against submission of bank guarantees. In terms of the scheme, the
company is obliged to export goods/services of certain FOB value as
specified in the said scheme. As at the year end, the company has the
following unfulfilled export obligations under the scheme:
NOTE 2 : BORROWINGS FROM BANKS AND OTHERS
a) The South Indian Bank issued notice under SARFAESI Act, in respect
of term loan and interest amounting to Rs. 18.92 Crores and subsequently
taken posession of the property of the Company situated at
Thiruvanmiyur, having carrying cost of Rs. 0.45 Crores on account of
continued default by the Company. The Bank had issued a
tender-cum-auction sale notice for which the Company has protested that
the properties are undervalued.
b) The State Bank of Mauritius Limited recalled the term loan and
interest amounting to Rs. 24.45 Crores, since the Company defaulted in
payment of principal and interest. Subsequently the loan was assigned
to Pegasus Assets Reconstruction Private Limited (''the ARC''). Since the
revised terms of restructure with the ARC is yet to be finalised, the
loan is included in Current Maturities of long term of borrowings in
Note 10 and the Company continues to provide interest at the rates
originally charged by the Bank.
c) The Allahabad Bank, one of the EPC Consortium lenders, recalled the
Cash Credit facility, WCTL and FITL term loans amounting in total to Rs.
172.02 Crores and subsequently issued notice under SARFAESI Act.
d) SICOM Limited recalled the term loan and interest amounting to Rs.
45.13 Crores during the year and subsequently issued notice under
SARFAESI Act.
e) IFCI Venture Capital Limited has recalled the term loan of Rs. 18.64
Crores during the year.
f) The term loan availed from Punjab National Bank having outstanding
balance of Rs. 44.61 Crores as on 31-Mar-2014 has become Non Performing
Asset during the year.
g) State Bank of Hyderabad has extended time for repayment of cash
credit facility of Rs. 10.36 Crores outstanding as on 31-Mar-2014 by nine
months ending Dec-2014.
NOTE 3 : PREPARATION OF FINANCIAL STATEMENTS ON ''GOING CONCERN'' BASIS
The Company has recorded a Net Loss of Rs. 263.80 Crores for the year
ended 31-Mar-2014 and Rs. 36.03 Crores for the year ended 31-Mar-2013.
The Company has defaulted in the payments due to Banks, Financial
Institution and others towards principal and interest and statutory
dues. Further there were lower cash inflows from existing projects.
Management is confident that the Company will be able to generate
profit and cash in future years and meet its financial obligation as
they arise. The financial statements have been prepared on a going
concern basis based on cumulative input of the following business
potential and mitigating factors:
a) The EPC division of the Company has an order book of Rs. 2795.08
Crores. Further local and international bids are being planned
leveraging the experience gained through execution of Marine,
Infrastructure and Industrial EPC.
b) The business of the Company was appraised and due diligence done by
Dun & Bradstreet in the previous year.
c) The Company has adequate resources and construction equipments and
manpower to execute the projects on hand and with the work experience
to its credit is eligible to undertake new projects.
d) The Company is also in the process of generating cash through equity
disinvestment in operating SPVs and realisation of advances given to
subsidiaries which have commenced new residential and plotted
development projects.
NOTE 4 : INVESTMENT AND ADVANCE/RECEIVABLES DUE FROM SUBSIDIARY
COMPANIES
1) The Company has invested in equity amounting to Rs.169.18 Crores in
New Chennai Township Private Limited, a wholly owned subsidiary as on
31-Mar-2014. The Company has advanced an amount of Rs. 237.93 Crores as
subordinated loan to the subsidiary and Rs. 57.32 Crores is carried
forward as receivables as on 31-Mar-2014. The said subsidiary has
incurred losses in the financial year ended 31-Mar-2014 and
31-Mar-2013, which has resulted in negative net-worth as on
31-Mar-2014. The subsidiary company has obtained valuation report for
the assets of the Company, from an approved valuer, which supports the
carrying value such investment and loan outstanding as on 31-Mar-2014.
The Company has tied up for setting up a world class research institute
in the Multi-services SEZ and is negotiating with new customers for its
light engineering/multi services SEZ. Accordingly, the financial
statements of the subsidiary Company have been prepared on ''Going
concern'' basis and the management is of the opinion that no provision
is considered necessary at this stage in respect of investments, loans
and receivables outstanding from the said subsidiary company as at
31-Mar-2014.
2) The Company has invested in equity amounting to Rs. 136.72 Crores in
Riverside infrastructure (India) Private Limited, subsidiary of the
Company. The Company has advanced an amount of Rs. 28.59 Crores as
subordinated loan to the subsidiary and Rs. 59.74 Crores is carried
forward as receivables as on 31-Mar-2014. The Mall project of the
subsidiary was suspended throughout the year and the Riverside Mall
property of the said company has been taken into possession by the
Banks during the year, as the company defaulted in payments of dues to
Banks/Financial Institutions towards principal and interest. The
management is taking efforts for resuming the project and is in
discussion with strategic partners for this purpose. Accordingly, the
financial statements of the subsidiary Company have been prepared on
''Going concern'' basis and the management is of the opinion that no
provision is considered necessary at this stage in respect of
investments, loans and receivables outstanding from the said subsidiary
company as at 31-Mar-2014.
3) The Company has invested in equity amounting to Rs. 54.05 Crores in
MARG Properties Limited, wholly owned subsidiary of the Company.The
Company has advanced an amount of Rs. 33.84 Crores as loan to the
subsidiary and Rs. 11.94 Crores is carried forward as receivables as on
31-Mar-2014.The Company has recorded a Net Loss of Rs. 4.54 Crores for
the year ended 31-Mar-2014, which has resulted in negative net-worth as
on 31-Mar-2014. The loans of the company have been restructured by
Banks with moratorium for principal and the Management is confident
that the Company will be able to generate profit from its projects and
cash in future years and meet its financial obligation as they arise.
Accordingly, the financial statements of the subsidiary company have
been prepared on ''Going concern'' basis and the management is of the
opinion that no provision is considered necessary at this stage in
respect of investments, loans and receivables outstanding from the said
subsidiary company as at 31-Mar-2014.
4) The Company has invested in equity amounting to Rs. 0.14 Crores and an
amount of Rs. 107.92 Crores is advanced as loan to its
subsidiaries/fellow subsidiaries and Rs. 4.38 Crores is carried forward
as receivables as on 31-Mar-2014, which have provided land owned by
them as security for the loans availed from lenders. As the borrowing
company defaulted in repayment of such loans, the land owned by these
subsidiaries may be attached/sold which may adversely affect the
recoverability of the investment/advance. However as on date no such
action has been initiated by the banks and accordingly, the financial
statements of such subsidiaries have been prepared on ''Going concern''
basis and management is of the opinion that no provision is considered
necessary at this stage in respect of investments, loans and
receivables outstanding from these subsidiaries as at 31-Mar-2014.
NOTE 5
a) The Company executed a construction contract at Agra for DG MAP, a
project of the Government of India which is terminated during the year.
The Company has receivables of Rs. 2.02 crores and work in progress of Rs.
13.99 Crores as on 31-Mar-2014 relating to this project. Inventory of
materials amounting to Rs. 2.01 Crores and plant and machinery amounting
to Rs. 2.14 Crores as on 31-Mar-2014 are withheld at site by the client.
The Company is in the process of making claim under arbitration and the
management is of the opinion that the above amount is considered good
and recoverable and hence no provision is made as on 31-Mar-2014.
b) The Company executed a construction contract at Dwaraka for M/s HSCC
(India) Limited, a project of the Government of India, in respect of
which the Company has filed arbitration claim.The Company has
receivables of Rs. 0.60 Crores and work in progress of Rs. 1.04 Crores as
on 31-Mar-2014 relating to this project and the Company has made a
claim under arbitration. The management is of the opinion that the
above amount is considered good and recoverable and hence no provision
is made as on 31-Mar-2014.
NOTE 6 : INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES
DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006 and hence disclosures relating to amounts unpaid as at the year
end together with interest paid / payable under this Act have not been
given.
NOTE 7 :
In the opinion of the Management, Current Assets, Loans & Advances have
a value on realization equal to the amount at which they are stated in
the Balance Sheet and provision for all known liabilities has been
made.
NOTE 8 : SEGMENT REPORTING
As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
NOTE 9 : REMUNERATION TO DIRECTORS
As the company has incurred losses for the Financial Year 2013-14 no
remuneration is paid to the Managing Director. (Previous Year Nil)
NOTE 10 : NON-CASH TRANSACTIONS
During the year loan of Rs. Nil Crores (Previous year Rs. 121.95 Crores)
given to subsidiaries of the company was converted into Share
Application Money and out of which Rs. Nil Crores (Previos year Rs. 22.95
Crores) were alloted to equity shares.
NOTE 11 : RELATED PARTY DISCLOSURES
A. Subsidiaries, where control existed during the year - Annexure A
B. Associates:
Rajakamanglam Thurai Fishing Harbour Private Limited
C. Key Management Personnel (KMP)
G R K Reddy-Chairman & Managing Director (CMD)
D. Relative of Key Management Personnel
1. V P Rajini Reddy-wife of the CMD
2. G Raghava Reddy-father of the CMD
E. Entities over which KMP and/or their relatives exercise control:
1. Akshya Infrastructure Private Limited
2. Avinash Constructions Private Limited
3. Exemplarr Worldwide Limited
4. Jeevan Habitat Private Limited
5. Marg Capital Markets Limited
6. Marg Foundation
7. Noble Habitat Private Limited
8. Swarnabhoomi Academic Institutions
F. Entities over which KMP and/or their relatives exercise significant
influence:
1. Global Infoserv Limited
2. Marg Digital Infrastructure Private Limited
3. Marg Projects and Infrastructure Limited
4. Marg Realities Limited
NOTE 12 : EMPLOYEES STOCK OPTIONS SCHEME(ESOP)
a) The Company has Employee Stock Option Scheme (the "Scheme") for all
eligible employees of the Company and its subsidiaries. Options are
issued at a price of not less than 50% of the prevailing market price
of the shares on the date of the grant of options and the same will
vest over a period of three years as under:
NOTE 13: OPERATING LEASES
a) Cancelable Lease:
Total rental charges under cancelable operating lease was Rs. 0.81 Crores
and Rs. 3.25 Crores for the 4th quarter and year ended 31-Mar-14
respectively (Previous year Rs. 1.13 Crores and Rs. 3.10 Crores).
NOTE 14 : INFORMATIONS PURSUANT TO SECTION 212(8) OF COMPANIES ACT
Information of (a) capital (b) reserves (c) total assets (d) total
liabilities (e) details of investments (except in case of investment in
subsidiaries) (f) turnover (g) profit (loss) before taxation (h)
provision for taxation (i) profit (loss) after taxation and (j)
proposed dividend for each subsidiary is furnished in Annexure B to the
accounts.
NOTE 15 : INFORMATIONS PURSUANT TO CLAUSE 32 OF LISTING AGREEMENT
Disclosure as required by Clause 32 of listing agreement with stock
exchanges for loans and advances given by the company are given in
Annexure A.
NOTE 16 : INFORMATIONS PURSUANT TO PART II OF SCHEDULE VI OF COMPANIES
ACT
The activities of the company are not capable of being expressed in any
generic unit and hence, it is not possible to give the quantitative
details required under Paragraphs 3, 4C and 4D of Part II of Schedule
VI of the Companies Act 1956.
NOTE 17 : PRESENTATION OF PREVIOUS YEAR''S FIGURES
Previous year''s figures have been regrouped / reclassified / rearranged
wherever necessary to bring them in conformity with the current year
figures.
Mar 31, 2013
NOTE 1 : CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts: Rs. 2.92 Crores
(Previous year Rs. 1.36 Crores)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies: Rs. 3,170.22 Crores (Previous year Rs. 3,101.31 Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs. 175.58 Crores (Previous year Rs. 182.79
Crores)
NOTE 2 : INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES
DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006 and hence disclosures relating to amounts unpaid as at the year
end together with interest paid / payable under this Act have not been
given.
NOTE 3 :
In the opinion of the Management, Current Assets, Loans & Advances have
a value on realization equal to the amount at which they are stated in
the Balance Sheet and provision for all known liabilities has been
made.
NOTE 4 : RELATED PARTY DISCLOSURES
A. Subsidiaries, where control existed during the year - Annexure A
B. Step-down subsidiary, where control existed for part of the year:
Wisdom Constructions Private Limited
C. Associates:
Rajakamanglam Thurai Fishing Harbour Private Limited
D. Key Management Personnel (KMP)
G R K Reddy-Chairman & Managing Director (CMD)
E. Relative of Key Management Personnel
1. V P Rajini Reddy-wife of the CMD
2. G Raghava Reddy-father of the CMD
F. Entities over which KMP and/or their relatives exercise control:
1. Akshya Infrastructure Private Limited
2. Avinash Constructions Private Limited
3. Exemplarr Worldwide Limited
4. Jeevan Habitat Private Limited
5. Marg Capital Markets Limited
6. Marg Foundation
7. Noble Habitat Private Limited
8. Swarnabhoomi Academic Institutions
G. Entities over which KMP and/or their relatives exercise significant
influence:
1. Global Infoserv Limited
2. Marg Digital Infrastructure Private Limited
3. Marg Projects and Infrastructure Limited
4. Marg Realities Limited
NOTE 5 : DEBT RESTRUCTURING:
The Fund based and Non-fund based Working Capital facilities of EPC
Division of the Company have been restructured by Consortium of banks
lead by Indian Bank by sanction of:
a) Working Capital Term Loan (WCTL) of Rs. 556.69 Crores by converting
the devolved Letters of Credit and part of Cash Credit.
b) Funded Interest Term Loan (FITL) of Rs. 30.94 Crores to fund the
interest from Oct-12 to Mar-13.
c) WCTL and FITL are repayable in 18 quarterly installment commencing
Dec-13.
Further to above the Corporate term loans availed by the company from
the following banks have been restructured as under:
a) Term Loan from Punjab National Bank for Rs. 35.80 crores payable in 4
and ² years commencing from Dec-13.
b) Funded Interest Term Loan from Punjab National Bank for Rs. 5.33
crores payable in 4 and ² years commencing from Dec-13.
c) Term Loan from State Bank of Mauritius Ltd for Rs. 20.83 crores
payable in 3 years commencing from Jan-14.
d) Vendor Bills Discounting Facility from Sicom Ltd has been
restructured into a term loan for Rs. 40 crores out of which Rs. 20 crores
payable in 12 instalments commencing from Dec-12 and balance of Rs. 20
crores payable in 2 quarters from Dec-13.
e) Short Term Loan from IFCI Venture Capital Funds Ltd for Rs. 18 crores
payable in 18 instalments commencing from Nov-13.
NOTE 6 : GOING CONCERN:
The Company has recorded a Net Loss for the Year and has defaulted in
the payments due to Banks / Financial Institution towards principal and
interest and statutory dues. Further there were lower cash inflows from
existing projects. Management is confident that the Company will be
able to generate profit and cash in future years and meet its financial
obligation as they arise. The financial statements have been prepared
on a going concern basis based on cumulative input of the following
business potential and mitigating factors:
a) The EPC division of the Company has an order book of Rs. 3221 Crores.
Further local and international bids are being planned leveraging the
experience gained through execution of Marine, Infrastructure and
Industrial EPC.
b) The business of the Company was appraised and due diligence done by
Dun & Bradstreet.
c) The Working Capital and other Loans of the Company have been
restructured by Banks with moratorum for interest and principal.
d) The Company has adequate resources and construction equipments and
manpower to execute the projects on hand and with the work experience
to its credit is eligible to undertake new projects.
e) The Company is also in the process of generating cash through equity
disinvestment in operating SPVs and realisation of advances given to
subsidiaries which have commenced new residential and plotted
development projects.
NOTE 7 : INFORMATIONS PERSUANT TO SECTION 212(8) OF COMPANIES ACT:
Information of (a) capital (b) reserves (c) total assets (d) total
liabilities (e) details of investments (except in case of investment in
subsidiaries) (f) turnover (g) profit (loss) before taxation (h)
provision for taxation (i) profit (loss) after taxation and (j)
proposed dividend for each subsidiary is furnished in Annexure B to the
accounts.
NOTE 8 : INFORMATIONS PERSUANT TO CLAUSE 32 OF LISTING AGREEMENT:
Disclosure as required by Clause 32 of listing agreement with stock
exchanges for loans and advances given by the company are given in
Annexure A.
NOTE 9 : INFORMATIONS PERSUANT TO PART II OF SCHEDULE VI OF COMPANIES
ACT:
The activities of the company are not capable of being expressed in any
generic unit and hence, it is not possible to give the quantitative
details required under Paragraphs 3, 4C and 4D of Part II of Schedule
VI of the Companies Act 1956.
NOTE 10 : FOREIGN CURRENCY EXPOSURES
The Company does not use any derivative instruments to hedge its
foreign currency exposures.
The details of foreign currency balances which are not hedged as at the
balance sheet date are as under:
NOTE 11 : PRESENTATION OF PREVIOUS YEAR''S FIGURES
Previous year''s figures have been regrouped / reclassified / rearranged
wherever necessary to bring them in conformity with the current year
figures.
Mar 31, 2012
NOTE 27 : CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts: Rs. 1.36 Crores
(Previous year Rs. 3.06 Crores)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies: Rs. 3,101.31 Crores (Previous year Rs. 2,277.16 Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs. 182.79 Crores (Previous year Rs. 126.56
Crores)
e. Claims not acknowledged as debts by the Company: Rs. 1.02 Crores
(Previous year Rs. 1.02 Crores)
NOTE 29 : INFORMATIONS UNDER MICRO, SMALL AND MEDIUM ENTERPRISES
DEVELOPMENT ACT, 2006
The Company has not received information from vendors regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006 and hence disclosures relating to amounts unpaid as at the year
end together with interest paid / payable under this Act have not been
given.
NOTE 30 :
In the opinion of the Management, Current Assets, Loans & Advances have
a value on realization equal to the amount at which they are stated in
the Balance Sheet and provision for all known liabilities has been
made.
NOTE 31 : RELATED PARTY DISCLOSURES
A. List of Subsidiaries, where control existed during the year -
Annexure A
B. List of Subsidiaries where control existed for part of the year:
1. Aaram Constructions Private Limited
2. Abhinaya Infradevelopers Private Limited
3. Ajani Constructions Private Limited
4. Akarsh Constructions Private Limited
5. Akhil Infrastructure Private Limited
6. Ambar Nivas Private Limited
7. Aparajitha Infrastructure Private Limited
8. Arogya Constructions Private Limited
9. Bay Infradevelopers Private Limited
10. Bhushan Tradelinks Private Limited
11. Giri Infradevelopers Private Limited
12. Goldenview Nivas Private Limited
13. Highrise Housing Projects Private Limited
14. Indraprastha Homes Private Limited
15. Jai Ganesh Infradevelopers Private Limited
16. Kanchanajunga Infradevelopers Private Limited
17. Karaikal Infradevelopers Private Limited
18. Kripa Infrastructure Private Limited
19. MARG Communications Private Limited
20. MARG Constructions (Chennai) Private Limited
21. MARG Port Management Services Private Limited
22. MARG Power Projects Private Limited
23. MARG Renewable Power Projects Private Limited
24. MARG Swarnabhoomi Logistics Private Limited
25. MARG Swarnabhoomi Power Private Limited
26. Marigold Villas Private Limited
27. Mayur Habitat Private Limited
28. Navita Estates Private Limited
29. New Era Land Developers Private Limited
30. Pathang Constructions Private Limited
31. Prospective Constructions Private Limited
32. Rainbow Habitat Private Limited
33. Rupak Constructions Private Limited
34. Sanjog Infrastructure Private Ltd
35. Saptarishi Projects Private Limited
36. Saral Homes Private Limited
37. Sathsang Constructions Private Limited
38. Siddhi Infradevelopers Private Limited
39. Singar Constructions Private Limited
40. Swarnabhoomi Port Private Limited
41. Veda infradevelopers Private Limited
42. Viswadhara Constructions Private Limited
C. Associates:
Rajakamanglam Thurai Fishing Harbour Private Limited.
D. Key Management Personnel (KMP)
G R K Reddy - Chairman & Managing Director (CMD)
E. Relative of Key Management Personnel
1. V P Rajini Reddy - Wife of the CMD
2. G Raghava Reddy - Father of the CMD
F. Entities over which KMP and/or their relatives exercise control:
1. Akshya Infrastructure Private Limited
2. Avinash Constructions Private Limited
3. MARG Capital Markets Limited
4. MARG Digital Infrastructure Private Limited
5. MARG Projects and Infrastructure Limited
6. MARG Foundation
7. Swarnabhoomi Academic Institutions
G. Entities over which KMP and/or their relatives exercise significant
influence:
1. Exemplarr Worldwide Limited
2. Global Infoserv Limited
3. MARG Realities Limited
NOTE 32 : SEGMENT REPORTING
As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
NOTE 35 : NON-CASH TRANSACTIONS
During the year loan of Rs. 27.39 Crores (Previous year Rs. 48.13 Crores)
given to subsidiaries of the company was converted into Share
Application Money and subsequently shares were allotted.
NOTE 38: OPERATING LEASES
a) Cancelable Lease:
Total rental charges under cancelable operating lease was Rs. 1.14 Crores
and Rs. 4.23 Crores for the 4th quarter and year ended 31-Mar-2012
respectively (Previous year Rs. 1.24 Crores and Rs. 3.83 Crores).
NOTE 42 : INFORMATIONS PERSUANT TO SECTION 212 (8) OF COMPANIES ACT:
Information of (a) capital (b) reserves (c) total assets (d) total
liabilities (e) details of investments (except in case of investment in
subsidiaries) (f) turnover (g) profit (loss) before taxation (h)
provision for taxation (i) profit (loss) after taxation and (j)
proposed dividend for each subsidiary is furnished in Annexure B to the
accounts.
NOTE 43 : INFORMATIONS PERSUANT TO CLAUSE 32 OF LISTING AGREEMENT:
Disclosure as required by Clause 32 of listing agreement with stock
exchanges for loans and advances given by the comapany are given in
Annexure A.
NOTE 44 : INFORMATIONS PERSUANT TO PART II OF SCHEDULE VI OF COMPANIES
ACT:
The activities of the company are not capable of being expressed in any
generic unit and hence, it is not possible to give the quantitative
details required under Paragraphs 3, 4C and 4D of Part II of Schedule
VI of the Companies Act 1956.
NOTE 46 : PRESENTATION OF PREVIOUS YEAR'S FIGURES
Previous year's figures have been regrouped / reclassified / rearranged
wherever necessary to bring them in conformity with the current year
figures.
Mar 31, 2011
1. CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts as on 31st March
2011 is Rs. 3.06 Crores (Previous year Rs. 6.99 Crores)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies : Rs. 2277.16 Crores (Previous year Rs. 2017.10 Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs. 126.56 Crores (Previous year Rs. 60.65
Crores)
d. The company has imported capital goods at concessional rate of
customs duty under the Export Promotion Credit Guarantee (EPCG) scheme
against submission of bank guarantees. In terms of the scheme, the
company is obliged to export goods/services of certain FOB value as
specified in the said scheme. As at the year end, the company has the
following unfulfilled export obligations under the scheme:
(Rs. in crores)
As at As at Due date of Obligation
31st Mar 2011 31st Mar 2010
Duty saved Export
obligation Duty saved Export
obligation
0.14 1.14 0.14 1.14 17-Feb-12
0.12 0.95 0.12 0.95 3-Jan-15
0.14 1.11 0.14 1.11 27-Feb-15
1.73 13.83 Nil Nil 20-May-18
0.31 2.47 Nil Nil 20-May-18
e. Claims not acknowledged as debts by the Company: Rs. 1.02 Crores
(Previous year Rs. 0.04 crore)
f. Income Tax Demand
Tax on Income
Details of Demand (Rs.)
Amount Paid under Protest
Assessment Demand
Raised By Till 31st
March 2010 During
2010-11 Total Forum Where
Dispute is
Year Dept. Pending
2001-02 16,785,003 16,879,719 - 16,879,719 Madras High
Court
2002 - 03 8,926,848 9,659,367 - 9,659,367 CIT
2007-08 13,40,625 13,40,625 - 13,40,625 ITAT, Chennai
2008-09 52,76,990 - 52,76,990 52,76,990 CIT(Appeal)
Tax Deducted at Source
Details of Demand (Rs.)
Amount Paid under Protest
Assessment Demand
Raised By Till 31st
March 2010 During
2010-11 Total Forum Where
Dispute is
Year Dept. Pending
1996 - 97 21,503 4,931 - 4,931 ITO - TDS
1997 - 98 2,368,619 2,317,682 - 2,317,682 ITO - TDS
1998 - 99 1,628,830 842,934 - 842,934 ITO - TDS
1999 - 00 1,857,640 581,282 - 581,282 ITO - TDS
2000 - 01 442,820 65,440 - 65,440 ITO - TDS
2. DEFERRED TAX LIABILITY
As per the Accounting Standard (AS-22) laid down by the Institute of
Chartered Accountants of India, the Company is required to make a
provision for deferred tax liability.
3. The Company has not received information from vendors regarding
their status under the Micro, Small and Medium Enterprises Development
Act, 2006 and hence disclosures relating to amounts unpaid as at the
year end together with interest paid / payable under this Act have not
been given.
4. In the opinion of the Management, Current Assets, Loans & Advances
have a value on realization equal to the amount at which they are
stated in the Balance Sheet and provision for all known liabilities has
been made.
5. SEGMENT REPORTING
As per Accounting Standard (AS) 17 on "Segment Reporting", segment
information has been provided under the Notes to Consolidated Financial
Statements.
6. RELATED PARTY DISCLOSURES
A. List of related parties, where control exists is given vide
Annexure A
B. Associates:
The Company holds 39% shares in Rajakamanglam Thurai Fishing Harbour
Private Limited.
C. Key Management Personnel (KMP)
G R K Reddy-Chairman & Managing Director (CMD)
D. Relative of Key Management Personnel
V P Rajini Reddy-Director and wife of the CMD
G Raghava Reddy-Director and father of the CMD
E. Entities over which KMP and/or their relatives exercise control:
i) Avinash Constructions Private Limited
ii) Noble Habitat Private Limited
iii) Jeevan Habitat Private Limited
iv) Akshya Infrastructure Private Limited
v) MARG Foundation
vi) Swarnabhoomi Academic Institutions
F. Entities over which KMP and/or their relatives exercise significant
influence:
i) Exemplarr Worldwide Limited
ii) MARG Digital Infrastructure Private Limited
iii) MARG Realities Limited
7. NON CASH TRANSACTIONS
During the year loan of Rs. 48.13 crore given to subsidiaries of the
company was converted into Share application money.
8. QUALIFIED INSTITUTIONAL PLACEMENT (QIP) AND PREFERENTIAL ISSUE OF
WARRANTS:
- Consequent to Qualified Institutional Placement (QIP), the Company
issued and allotted 56,31,648 Equity Shares of Rs. 10 each at a premium
of Rs. 179.88 per share on 3rd May 2010 to Qualified Institutional
Buyers (QIB) under Chapter VIII of SEBI's Issue of Capital & Disclosure
Regulations, 2009. The entire proceeds of Rs. 106.93 crores received
under the QIP issue was utilized in 2010-11.
- During 2009-10 the Company issued 67, 71, 619 warrants convertible
into equity shares at the option of the holders, on preferential basis.
Out of the above, the Company upon conversion of 15,62,100 warrants
allotted equal number of 15,62,100 equity shares in 2009-10 and balance
of 52,09,519 warrants were converted into equal number of 52,09,519
equity shares in 2010-11 and the issue price of warrants convertible
into equity shares was at ^10 each at a premium of Rs. 51 per share.
This includes 49,00,000 equity shares allotted to the promoters. Out of
the total Preferential warrant proceeds of Rs. 23.48 crores received
during the year, the company utilized Rs. 23.83 crores in the year,
including the balance carried forward from last year.
c) During the year 69,390 equity shares were allotted to the employees
who exercised the option.
9. Operating Leases
Cancelable Lease:
Total rental charges under cancelable operating lease wasRs. 1.24crore
and Rs.3.83 for the quarter and year ended 31 March 2011 respectively.
(Previous year Rs. 0.42 crore and Rs. 1.98 crores)
10. In terms of approval granted by Ministry of Company Affairs,
Government of India under Section 212(8) of the Companies Act, 1956, a
copy of Balance Sheet, Profit & Loss Account, Report of Board of
Directors and the Report of the Auditors of the Subsidiary Companies
have not been attached with Annual Report of the Company. The Company
will make available these documents and the related details upon
request by any investor of the Company and its Subsidiary. These
documents will also be available for inspection by any investor at the
Registered Office of the Company at "Marg Axis", 4/318, Rajiv Gandhi
Salai, Kottivakkam, Chennai - 600 041.
11. Disclosure as required by clause 32 of listing agreement with
stock exchanges for loans & advances given by the Company are given in
Annexure A.
12. The activities of the company are not capable of being expressed
in any generic unit and hence, it is not possible to give the
quantitative details required under Paragraphs 3, 4C and 4D of Part II
of Schedule VI of the Companies Act 1956.
13. Foreign Currency Exposures
The Company does not use any derivative instruments to hedge its
foreign currency exposures.
14. Previous year's figures have been regrouped / reclassified /
rearranged wherever necessary to bring them in conformity with the
current year figures.
Mar 31, 2010
1. CONTINGENT LIABILITIES
a. Estimated amount of liability on capital contracts as on 31st March
2010 is Rs 6.99 Crores (Previous year 0.02 Crore)
b. Corporate Guarantees given to Banks in respect of loans taken by
other Companies : Rs 2017.10 Crores (Previous year Rs 980.30 Crores)
c. Corporate Guarantees given to Banks in respect of performance bank
guarantees issued by them: Rs 60.65 Crores (Previous year Rs 11.32
Crores)
d. Unfulfilled Export Obligations of Rs 1.14 Crores (Previous Year Rs.
1.14 Crores), Rs. 1.13 Crores (Previous Year Rs. 1.13 Crores) & Rs.
0.94 Crore (Previous year Rs. 0.95 Crore) to be performed on or before
17th February 2012, 27th February 2015 & 3rd January 2015 respectively,
undertaken by the Company for import of capital goods.
e. Claims not acknowledged as debts by the Company: Rs. 0.04 Crore
(Previous year Rs. 0.04 Crore)
2. DEFERRED TAX LIABILITY
As per the Accounting Standard (AS-22) laid down by the Institute of
Chartered Accountants of India, the Company is required to make a
provision for deferred tax liability.
3. Balances of Sundry Debtors, Sundry Creditors and other balances are
subject to confirmation by the parties.
4. The Company has not received information from vendors regarding
their status under the Micro, Small and Medium Enterprises Development
Act, 2006 and hence disclosures relating to amounts unpaid as at the
year end together with interest paid / payable under this Act have not
been given.
5. In the opinion of the Management, Current Assets, Loans & Advances
have a value on realization equal to the amount at which they are
stated in the Balance Sheet and provision for all known liabilities has
been made.
6. SEGMENT REPORTING
There are no reportable segments for the current year, as per the
accounting Standard on Segment Reporting (AS 17) issued by the
Institute of Chartered Accountants of India. Hence segment reporting is
not applicable.
7. RELATED PARTY DISCLOSURES
A. List of related parties, where control exists is given vide
Annexure A
B. Associates:
The Company holds 39% shares in Rajakamanglam Thurai Fishing Harbour
Private Limited.
C. Key Management Personnel (KMP)
G R K Reddy-Chairman & Managing Director
D. Relative of Key Management Personnel
V P Rajini Reddy-Director and wife of the MD
E. Entities over which KMP and/or their relatives exercise control: i)
Avinash Constructions Private Limited
ii) Noble Habitat Private Limited
iii) Jeevan Habitat Private Limited
iv) Akshya Infrastructure Private Limited
v) Marg Foundation
F. Entities over which KMP and/or their relatives exercise significant
influence: i) Exemplarr Worldwide Limited
ii) Marg Digital Infrastructure Private Limited iii) Marg Realities
Limited
8. NON CASH TRANSACTIONS
During the year, the Company sold the Dredger asset for Rs 61.45 crores
to its wholly owned Foreign Subsidiary, Marg International Dredging Pte
Ltd. In exchange, the subsidiary issued 69,99,200 shares of SGD 1 each.
9. PREFERENTIAL ISSUES OF EQUITY SHARES AND WARRANTS
a) The Company has taken up many projects and to part finance the
capital for the second phase of Karaikal Port, the Company has raised
money through preferential allotment of Warrants to the promoters, Key
Management Personnel ,employees and others during the year at an issue
price calculated as per SEBI (Disclosure and Investor Protection )
Guidelines, 2000 on preferential basis duly approved by Shareholders
and Board of Directors of the Company.
b) During the year the Company issued 67,91,619 Preferential warrants
convertible into equity shares at the option of the holder. Out of the
above, the Company upon conversion allotted 15,62,100 equity shares of
Rs. 10/- each at a premium of Rs. 51/- per share, which includes
14,50,000 shares allotted to promoters.
c) Out of the total Preferential Warrants proceeds of Rs.17.82 crores,
Rs. 17.47 crores has been utilized during the year.
10. Operating Leases
Total rental expense under cancelable operating lease was Rs 0.42 crore
and Rs 1.98 crores for the quarter and year ended 31 March 2010
respectively. (Previous year Rs 0.42 crore and Rs 1.58 crores)
11. In terms of approval granted by Ministry of Company Affairs,
Government of India under Section 212 (8) of the Companies Act, 1956, a
copy of Balance Sheet, Profit & Loss Account, Report of Board of
Directors and the Report of the Auditors of the Subsidiary Companies
have not been attached with Annual Report of the Company. The Company
will make available these documents and the related details upon
request by any investor of the Company and its Subsidiary. These
documents will also be available for inspection by any investor at the
Registered Office of the Company at "Marg Axis", 4/318, Rajiv Gandhi
Salai, Kottivakkam, Chennai à 600 041.
12. Disclosure as required by clause 32 of listing agreement with stock
exchanges for loans & advances given by the Company are given in
Annexure A.
13. Previous years figures have been regrouped / reclassified /
rearranged wherever necessary to bring them in conformity with the
current year figures.
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