Mar 31, 2018
1. General Information
Nath Pulp and Paper Mills Limited (CIN L21100MH1975PLC018289) is incorporated under the Companies Act, 1956 with its registered office at Nath House, Nath Road, Aurangabad. The company is engaged in the business of Manufacturing of Paper and Paper Board. The Company has a product range of Kraft Paper, Core Board, Thermal Paper & Coated Paper. The Factory is situated at Village Wahegaon, TqPaitha, Dist Aurangabad (MS).
The financial statement for the year ended 31st March 2018 are approved by the Board of Directors and authorized for issue on 30th May 2018.
B) Rights, Preferences and Restrictions attached to Shares
The Company has one class of equity shares having a par value of Rs. 10 per share. Equity shareholder is eligible for one vote per share held. They are eligible for dividend on the basis of their shareholding. In the case of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, if any, in proportion to their shareholding.
Note:-Deferred Sales Tax Liability of VAT as also of SGST has not been valued at fair value, which would have been Rs. 13,18,73,222 as required under the Ind AS - 113: Fair Value Measurement, considering the fact that the company is liable to pay entire dues to the Government as per its schedule of repayment.
Note :
a) Term Loan from ARC Trust
(I) Term Loans are secured by way of first charge on movable and immovable properties of the Company including its movable plant & machinery, spares, Tools and accessories and other movables both present and future (Save and except books debts) situated at Village Wahegaon and Issarwadi, PaithanDist Aurangabad Maharashtra and collaterally secured by mortgage of certain plots of land belonging to a group company and relatives of director.
(II) First Charge by way of hypothecation of entire current Assets, Book debts, both present and future of the Company.
(III) Secured by mortgage of certain land and building.
(IV) Secured by personal guarantee by a promoter of the Company.
b) Inter-corporate deposit from a company
Secured by pledge of shares of a group company owned by Promoter group Companies
Note No 2: First Time adoption of Ind AS
Transition to IndAS .
These are the Company''s first financial statement prepared in accordance with Ind AS.
The accounting policies set out in Note 1, have been applied in preparing the financial statements for the year ended March 31, 2018, the comparative information presented in these financial statements for the year ended March 31, 2017 and in the preparation of opening Ind AS balance sheet as at April 1, 2016. In preparing its opening balance sheet, the Company has adjusted the amounts reported previously in financial statements prepared in accordance with accounting standards notified under Companies (Accounting Standards) Rules, 2006 (as amended) and other relevant provisions of the Act (previous GAAP or Indian GAAP). An explanation of how the transition from from previous GAAP to Ind AS has affected the Company''s financial position, financial performance and cash flows is set out in the following tables and notes
2.1 emptions and exceptions availed
Ind AS optional exemptions cost.
2.1.1. Deemed cost:-Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its property, plant and equipment as recognized in the financial statements as at the date of transition to Ind AS, measured as for the previous GAAP and use that as its deemed cost as at date of transition after making necessary adjustments for decommissioning liabilities. The exemption can also be used for intangible assets covered by Ind -38 Intangible Assets. Accordingly, the Company has elected to measure all of its property, plant and equipment and intangible assets at their previous GAAP carrying values as at April 1, 2016.
2.1.2 Leases: Appendix -C to Ind AS 17 requires an entity to assess whether a contract or arrangement contains a lease. In accordance with Ind AS 17, this assessment should be carried out at the inception of the contract or arrangement. Ind AS 101 provides an option to make this assessment on the basis of facts and circumstances existing at the date of transition to Ind AS, except where the effect is expected not to be material. The Company has elected to apply this exemption for such contracts / arrangements.
2.1.3. Decommissioning liability included in the cost of property, plant and equipment: An entity need not to comply with the requirements of Appendix A of Ind AS -16 changes in Existing Decommissioning, Restoration similar liabilities for liabilities occurred before the date of transition to Ind AS. An entity can measure the liability as at the date transition. The Company has elected to measure such liabilities as on the date of transition and on the basis of such evaluations no liabilities need to be recognized.
3.1. Ind AS mandatory exceptions
3.1.1. De-recognition of financial assets and liabilities: IndAs 101 requires a first time adopter to apply the derecognition provisions of Ind AS 109 prospectively for transactions occurring on or after the date of transition to Ind AS. However, Ind AS 101 allows a first-time adopter to apply the de-recognition requirements in Ind AS 109 retrospectively from a date of the entity''s choosing, provided that the information needed to apply AS 109 to financial assets and Financial liabilities de-recognized as a result of past transactions was obtained at the time of initially accounting for those transactions. The Company has elected to apply the de-recognition provisions of Ind AS 109 prospectively from the date of transition to Ind AS
3.2.2 Classification and measurement of financial assets: Ind AS 101 requires an entity to assess classification and measurement of financial assets (investment in debt instruments) on the basis of the facts and circumstances that exist at the date transition to Ind AS.
3.2.3. Impairment of financial assets: An entity shall determine the approximate credit risk at the date that financial instruments were initially recognized and compare that to the credit risk at the date of transition to Ind. This should be based on reasonable and supportable information that is available without undue cost or efforts. If any entity is unable to make this determination without undue cost or effort, it shall recognize a loss allowance at an amount equal to lifetime expected credit losses at each reporting date until that financial instrument is derecognized. The Company has this exception to analyse credit risk of the financial assets as the date of transition instated of the date of initial recognition.
The management assessed that the fair values of short term financial assets and liabilities significantly approximate their carrying amounts largely due to the short term maturities of these instruments. The fair value of financial assets and liabilities is included at the amount at which the instrument could be exchanged in a current transaction among willing parties, other than in a forced or liquidation sale
The Company determines fair values of financial assets and financial liabilities by discounting contractual cash inflows/ outflows using prevailing interest rates of financial instruments with similar terns. The fair value of investment is determined using quoted net assets value from the fund. Further, the subsequent measurement of all finance assets and liabilities (other than investment in mutual funds) is at amortized cost, using the effective interest method.
Discount rates used in determining fair value
The interest rate used to discount estimated future cash flows, where applicable, are based on the incremental borrowing rate of the borrower which in case of financial liabilities is the weighted average cost of borrowing of the Company and in case of financial assets is the average market rate of similar credits rated instrument
The Company maintains policies and procedures to value financial assets or financial liabilities using the best and most relevant data available. In addition, the Company internally reviews valuation, including independent price validation for certain instruments.
Fair value of financial assets and liabilities is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique.
The following methods and assumptions were used to estimate fair value:-
a. Fair value of short term financial assets and liabilities significantly approximate their carrying amounts largely due to the short term maturities of these instruments.
b. The fair value of the Company''s interest borrowing received are determined using discount rate reflects the entity''s borrowing rate as at the end of the reporting period. The own non performance risk as at the end of reporting period was assessed to be insignificant.
Fair value hierarchy
All financial instruments for which fair value is recognized or disclosed are categorized within the fair value hierarchy described as follows, based on the lowest level input that is significant to the fair value measurement as a whole.
Level-1: Quoted (unadjusted) price in active market for identical assets or liabilities
Level-2: Valuation technique for which the lowest level input that has a significant effect on the fair value measurement are observed, either directly or indirectly.
Level-3: Valuation technique for which the lowest level input has a significant effect on the fair value measurement is not based on observation market data.
Note No 4: Financial Instruments and Risk Review
I) Capital Management
The Company''s capital management objectives are:-
The Board policy is to maintain a strong capital base so as to maintain investor, creditors and market confidence and to future development of the business. The Board of Directors monitors return on capital employed.
The Company manages capital risk by maintaining sound/optimal capital structure through monitoring of financial ratios, such as debt-to-equity ratio and net borrowings-to-equity ratio on a monthly basis and implements capital structure improvement plan when necessary.
The Company uses debt ratio as a capital management index and calculates the ratio as Net debt divided by total equity. Net debt and total equity are based on the amounts stated in the financial statements.
* Net Debts includes Non-Current borrowings, Current borrowings, Current Maturities of non-current borrowing net off Current Investment and cash and cash equivalent
** Equity Includes capital and other equity
II) Credit Risk
Credit risk is the risk of financial loss arising from counter-party failure to repay or service debt according to contractual terms or obligations. Credit risk encompasses both, the direct risk of default and the risk of deterioration of credit worthiness as well as concentration of risks. Credit risk is controlled by analyzing credit limit and creditworthiness of customers on a continuous basis to whom the credit has been granted offer necessary approvals for credit.
Financial instruments that are subject to concentration of credit risk principally consists of trade receivable investments, derivative financial instruments and other financial assets. None of the financial instruments of the Company results in material concentration of credit risk
Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk is as under, being the total of the carrying amount of balances with trade receivables.
Trade receivables
Ind AS requires expected credit losses to be measured through a loss allowance. The Company assesses at each date of financial statement whether a financial asset or group of financial assets is impaired. The Company recognizes lifetime expected losses for all contract assets and / or all trade receivables that do not constitute a financing transaction. For all other financial assets, expected credit losses are measured at an amount equal to 12 months expected credit losses or at an amount equal to the life time expected credit losses, if the credit risk on the financial asset has increased significantly since initial recognition
Before accenting any new customer, the Company uses an external/internal credit scoring system to assess potential customer''s credit quality and defines credit limits by customer. Limits and scoring attributed to customer are reviewed periodic basis
III) Liquidity Risk
a) Liquidity risk management
Liquidity risk refers to the risk that the Company cannot meet its financial obligations. The objective of liquidity risk management is to maintain sufficient liquidity and ensure that funds are available for use as per requirements. The Company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.
b) Maturities of financial liabilities
The following tables detail the remaining contractual maturities for its financial liabilities with agreed repayment period. The amount disclosed in the tables have been draw up based on the undiscounted cash flow of financial liabilities based on the earliest date on which the Company can be required to pay. The table includes both interest and principal cash flows.
c) Maturities of financial assets
The following table details the Company''s expected maturity for financial assets. The table has been drawn up on based on the undiscounted contractual maturities of the financial assets including interest that will be earned such assets.
IV) Market Risk
Market risk is risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in the market prices. Such changes in the value of financial instruments may result from changes in the foreign currency exchange rate, interest rate, credit, liquidity and other market changes.
Note No 5: In the opinion of the Board, Current and Non-current Assets, Loans and Advances are approximately of the value stated, if realized in the ordinary course of the business.
Note No 6: Certain accounts of Trade Receivable, Trade Payable, Unsecured Loans, Employees, certain current account balances with banks, Loans and Advances are subject to confirmations and reconciliations, if any. The difference as may be noticed on reconciliation will be duly accounted for on completion thereof. In the opinion of the management, the ultimate difference will not be material.
Note No 7: Segment Reporting
In the opinion of the management, the Company is mainly engaged in the business of manufacturing of paper. As such, there are no separate reportable segments
Note No 8: In the opinion of the Board, Property, Plant and Equipment have been stated at cost, which is at least equal to or less than the realizable value if sold in the ordinary course of business. Consequently, the management is of the opinion that there is no impairment of Property, Plant and Equipment.
Note No 9: Employee Benefits
The company has classified the various benefits provided to employees as under:
Defined Contribution Plans:
During the year, the Company has recognized the following amounts in the Profit & Loss Account
Defined Benefit Plans:
The company has neither created fund nor contributed to Scheme framed by the Insurance Company for the defined benefit plans for the qualifying employees. The present value of the defined benefit obligation and the related current service cost were measured using the Projected Unit credit method with actuarial valuations being carried out at each balance sheet date.
g) Expected contributions to Gratuity Fund next year Rs. NIL (Previous Year Rs. NIL)
h) The liability for leave encashment and compensated absences as at year end is Rs. 36,40,454 (Previous year liability Rs. 41,05,915)
Note
1. Related party relationship is as identified by the Company and relied upon by the Auditors.
2. No amounts in respect of related parties have been written off/back during the year, nor have been provided for as doubtful debts.
Note No 10: Expenditure on Corporate Social Responsibility Activities
As the company is not covered under criterion specified under the provisions of section 135 of the Companies Act, 2013, the company is not liable for spending any amount towards corporate social responsibility.
Note No 11:During the year, the Company has not appointed internal auditor as per the provisions of section 138 of the Companies Act, 2013. However, company has adequate inter control systems commensurate with the size of company and nature of its business.
Note No 12: As per the directions given by Hon''ble BIFR vide sanctioned scheme dated 14th February, 2012
The Department of Sales Tax, Govt. of Maharashtra, vide its order dated 9th May 2017, has extended the repayment period of Deferred Sales Tax under the package scheme of incentive 1988, of Government of Maharashtra by a further 8 years. Accordingly, the repayment will start from April 2019.
The Department of Industries, Government of Maharashtra has sanctioned vide their letter dated 07.12.2015, extension of Eligibility for the unutilized CQB of Rs. 19,51,74,505 under PSI-1988, for a further period of 5 years i.e. from 1st November, 2015 to 31st October, 2020
In accordance with extended eligibility, the company has utilized Rs.3,89,75,747during the year(Previous Year Rs. 1,31,49,044)vide Addenda No IX Dt. 29/02/2016 issued by Joint Director of Industries, Aurangabad Region, Aurangabad.
Note No 13: i)Pursuant to the letter dated 28th September 2017 of ARC Trust , the Company is required to pay Rs. 31.00.00.000 of their dues on or before 30th June, 2018 out of which the company has paid Rs.21.00.00.000 leaving a balance of Rs. 10.00.00.000 and interest thereupon.
II) In addition, the Promoters/Guarantors of the Company are to arrange repurchase of 20,00,000 equity shares of the Company as held by ARC Trust @Rs. 32.50 per share on or before 30th June 2018. The promoters have since purchased 13,33,330 shares.
III) Pursuant to the order of Hon''ble BIFR dated 11th November, 2013, the dues of IFCI is repayable w.e.f. 14th February, 2012 in 16 equal quarterly installments of Rs.5,12,500 each along with simple interest @ 12.50% p.a. on reducing balance method. As on 31st March 2018,the company has paid entire principal dues leaving interest amounting to Rs. 39,46,697 which is yet to be paid.
Note No 14: Previous year''s figures have been regrouped / rearranged wherever necessary to conform to the current year''s presentation.
Mar 31, 2016
1. Disclosures required under section 22 of the Micro, Small and Medium Enterprises Development Act, 2006. Dues to Micro and Small Enterprises have been determined to the extent such parties have been identified on the basis of information collected by the Management and relied upon by the auditors._
The company has compiled the above information based on confirmations from some suppliers. As at the year end, no other supplier has intimated the company about its status as a Micro, Small & Medium Enterprises or its registration under the Micro, Small & Medium Enterprises Development Act 2006. No interest payment is likely to be made to unsecured creditors as per sanction order of Honâble BIFR dt. 14/02/12 and hence, no interest liability in respect of above category of creditors is provided / disclosed.
2. Land, certain Buildings and Plant and Machinery were revalued as on June 30, 1994 and the resultant increase in value amounting to Rs. 37,723,368 for Land, Rs.17,587,749 for Buildings and Rs..66,686,621 for Plant and Machinery aggregating to Rs..121,997,738 had been transferred to Revaluation reserve . The Valuation was carried out by an external approved valuer on the basis of replacement value of similar assets after considering the obsolescence and age of individual asset.
The following revalued amounts (net of withdrawals) remain substituted for the historical cost in the gross block of Fixed Assets.
3. Details of consumption of imported and indigenous items
4. The Company is making concerted efforts to appoint a Whole time Company Secretary as required under the provisions of Section 203 of the Companies Act, 2013.
5. The accounts of certain Debtors, Creditors / Loans given are subject to confirmations, reconciliations and adjustments, if any, having consequential impact on the profit for the year, assets and liabilities, the amounts whereof are presently not ascertainable. However, the management does not expect any material difference in the above accounts affecting the current yearâs financial statements.
6. In the opinion of management, Current Assets have a value on realization in the ordinary course of business at least equal to the amount at which they are stated.
7. In the opinion of the management, the Company is mainly engaged in the business of manufacturing of paper. As such, there are no separate reportable segments.
8. Loans and Advances in the nature of loans where there is no repayment schedule or no interest or at an interest rate below what is specified in Section 186 of the Act.
(Figures in brackets pertain to previous year)
9. In respect of the above parties, rate of interest is Nil.
10. In respect of loans/advances referred to above, in view of financial exigencies, the Company has not complied with Section 186 of the Act, in as much as these are interest free loans and approval of financial institutions has not been obtained.
11. The Company is in the process of getting its cost records audited by a cost auditor for the current financial year as required under the provisions of Section 148 of the Companies Act, 2013.
12. During the year, Company has not appointed internal auditor as per the provisions of section 138 of the Companies Act, 2013.
13. The Financial Statements for the year ended 31st March, 2016 have been prepared on a "going concern basis" as the long term prospects appear better for the paper industry as also in view of the reliefs/concessions that the Company has obtained on sanction of rehabilitation package by the Board of Industrial and Financial Reconstructions (BIFR).
14. The Company had submitted Draft Rehabilitation Scheme as per the direction given (including for restructuring of Loans) by Honâble BIFR, vide summary of proceedings dated 28th September 2010 through its Operating Agency namely IDBI. The Hon''ble BIFR approved the scheme and passed the sanction order on dated 14th February 2012.
15. Deferred Sales Tax liability under 1988 Package Scheme of Incentives of the Government of Maharashtra is repayable in five annual installments after 10 years from the respective years, after the commencement date i.e., 1stOctober 2000. Hon''ble BIFR in its sanction scheme dated 14/02/ 12 directed to State Govt. to consider the repayment period of the deferred sales tax liability by eight years from the due date for the respective installments against the existing outstanding without charging any interest during the extended period. Decision with respect of Grant of installments for payment of Deferral Sales tax liability as directed by Honâble BIFR is pending with Govt. of Maharashtra; hence the contingent liability arising in the event of non-extension is not ascertainable.
16. The company was sanctioned the limit of Rs. 74,22,77,000 under The Package Scheme Of Incentive 1988 for the period 01st November 1993 to 31st January 2009. Out of this the company has utilized the limit of Rs. 54,71,02,495 against Sales Tax payable up to 31st Jan 2009 and un utilization of balance CQB of Rs. 19,51,74,505. Department of Industries Govt. of Maharashtra has sanctioned extension of Eligibility against un utilized CQB of Rs. 19,51,74,505 for a period of 5 years i.e. from 1st Nov-2015 to 31st Oct 2020 as per BIFR Order Dtd 14/02/2012.
17. In accordance with modified eligibility the company has utilized Rs. 1,31,49,044 for the period 1st November 2015 to 31st March 2016 from sanctioned limit as per extended eligibility certificate vide Addenda No IX Dt. 29/02/2016 issued by Joint Director of Industries, Aurangabad Region Aurangabad.
18. Repayment Schedule, as per sanction order dt. 14/02/2012 of Hon''ble BIFR towards repayment of secured and unsecured borrowings and their overdue as on 31March 2016 are as under:
19. Arc-Trust: Balance as on 31 December 2008 of Rs..237,200,000 to be converted into non-convertible debentures and redeemed along with premium of Rs.. 98,800,000, amounting to Rs..336,000,000 in 16 quarterly installments w.e.f 31.12.2008. In addition to this Arc Trust to subscribe 2,000,000 equity shares of Rs..10 each at par aggregating to Rs.. 20,000,000. These shares have been issued in dematerialized form. There is an overdue principal amount as on 31 March 2016 of Rs..64,910,000 (Previous year Rs..104,910,000) and un -provided interest of Rs..140,450,329 (Previous year Rs..128,640,719)
20. IFCI: The Dues payable to IIBI have been taken over by IFCI. Honâble BIFR Substituted name of Industrial Investment Bank of India (IIBI) to Industrial Finance Corporation of India (IFCI) , Therefore dues payable to IIBI are now shown payable to IFCI. Repayment is to be made in 16 equal quarterly installments of Rs..512,500 per quarter along with simple interest @ 12.50% p.a. on reducing balance method w.e.f. from 14.02.12(date of sanction of scheme).There is Rs.. 7,103,388 (Previous year Rs..6,554,733) overdue as on 31 March 2016.
21. MSFC: Repayment was scheduled in 16 equal quarterly installments of Rs..937,500 per Quarter along with simple interest @ 12.50% p.a. on reducing balance method w.e.f. from 14.02.12 (date of sanction of scheme). During the year OTS scheme granted as per letter No: .MSFC/HO/NPPML/2014-15/ 108, dated 5.11.2014 according to which Rs..6,000,000 payable in 15 monthly installments starting from 1.12.2014. There is Rs.. Nil (previous year Rs.. 4,00,000) overdue as on 31 March 2016.
22. Overdue installments of financial Institutions as on 31 March 2016 are recognized as long term Borrowings instead of current liabilities as required under Schedule III. Outstanding balances as on 31st March 2016 subject to reconciliation.
23. DISCLOSURES UNDER ACCOUNTING STANDARDS
24 Employee benefit plans: Defined contribution plans
The Company makes Provident Fund contribution to defined contribution plan for qualifying employees. Under the Scheme, the Company is required to contribute a specified percentage of the payroll costs to fund the benefits. The Company recognized Rs. 3,134,229 (Year ended 31st March, 2015 Rs. 2,762,043) for Provident Fund contribution in the Statement of Profit and Loss. The contribution payable to this plan by the Company is at the rates specified in the rules of the schemes.
Defined benefit plans
The Company offers the following employee benefit scheme to its employees:
25. Gratuity
The following table sets out the status of the defined benefit scheme and the amount recognized in the financial statement:
26. Para 132 of Accounting Standard 15 (Revised 2005) does not require any specific disclosures except where expense resulting from compensative absence is of such size, nature or incidence that its disclosure is relevant under Accounting Standard 5 or Accounting Standard 18. In the opinion of the management, the expense resulting from compensated absence is not significant and hence disclosures under various paragraphs of Accounting Standard 15 (Revised 2005) are not applicable. The liability for leave entitlement and compensated absences as at period end is Rs. 3,700,464 (March 31, 2015 Rs. 3, 746,687).
27. Related Party Transactions
Details of related parties:
Associates
28. Nath Bio-Genes (India) Ltd.
29. NathNirman Infra Pvt. Ltd.
3.. Tapovan International Trading Pvt. Ltd.
Key Management Personnel (KMP)
Mr. Akash N. Kagliwal (Whole Time Director)
Mr. Vijay L. Saboo (CFO)
As per AS - 22 âAccounting for taxes on Incomeâ Deferred Tax Assets are recognized and carried forward to the extent that there is a reasonable certainty that sufficient future taxable income will be available against which Deferred Tax Assets can be realized. Deferred tax assets are reviewed at each Balance Sheet Date. The Company has recognized deferred tax asset on unabsorbed depreciation and brought forward business losses based on the Management''s estimates of future profits of the Company.
31. PREVIOUS YEAR FIGURES:
The financial statements for the year ended March 31, 2015 are prepared as per Schedule III of the Companies Act, 2013. Accordingly, the previous year figures have also been reclassified to conform to this Yearâs classification.
Mar 31, 2015
NOTE 1: CORPORATE INFORMATION:
The company is registered with the Registrar of Companies, Maharashtra
State, Mumbai vide Regn No. L2100MH1975PLC018289 dated 10/04/1975 under
the Companies Act,1956 (No.1 of 1956). The registered office of the
Company is situated at Nath House, Nath Road, Aurangabad. The Company
is the leading producer of high strength core board and Thermal grade
paper used by text tube manufacturers.
2.01 Disclosures required under section 22 of the Micro, Small and
Medium Enterprises Development Act, 2006.Dues to Micro and Small
Enterprises have been determined to the extent such parties have been
identified on the basis of information collected by the Management and
relied upon by the auditors.
The company has compiled the above information based on confirmations
from some suppliers. As at the year end, no other supplier has
intimated the company about its status as a Micro, Small & Medium
Enterprises or its registration under the Micro, Small & Medium
Enterprises Development Act 2006. No interest payment is likely to be
made to unsecured creditors as per sanction order of Hon'ble BIFR dt.
14/02/12 and hence, no interest liability in respect of above category
of creditors is provided / disclosed.
2.02 Land, certain Buildings and Plant and Machinery were revalued as
on June 30, 1994 and the resultant increase in value amounting to Rs.
3,77,23,368 for Land, Rs.1,75,87,749 for Buildings and Rs.6,66,86,621
for Plant and Machinery aggregating to Rs.12,19,97,738 had been
transferred to Revaluation reserve . The Valuation was carried out by
an external approved valuer on the basis of replacement value of
similar assets after considering the obsolescence and age of individual
asset.
The following revalued amounts (net of withdrawals) remain substituted
for the historical cost in the gross block of Fixed Assets.
2.03 The Company is making concerted efforts to appoint a Whole time
Company Secretary as required under the provisions of Section 203 of
the Companies Act, 2013.
2.04 (a) The accounts of certain Debtors, Creditors / Loans given are
subject to confirmations, reconciliations and adjustments, if any,
having consequential impact on the profit for the year, assets and
liabilities, the amounts whereof are presently not ascertainable.
However, the management does not expect any material difference in the
above accounts affecting the current year's financial statements.
(b) In the opinion of management, Current Assets have a value on
realization in the ordinary course of business at least equal to the
amount at which they are stated.
2.05 In the opinion of the management, the Company is mainly engaged
in the business of manufacturing of paper. As such, there are no
separate reportable segments.
(Figures in brackets pertain to previous year)
(i) In respect of the above parties, rate of interest is Nil.
(ii) In respect of loans/advances referred to above, in view of
financial exigencies, the Company has not complied with Section 186 of
the Act, in as much as these are interest free loans and approval of
financial institutions has not been obtained.
2.06 i) The Company is in the process of getting its cost records
audited by a cost auditor for the current financial year as required
under the provisions of Section 148 of the Companies Act, 2013.
ii) During the year, Company has not appointed internal auditor as per
the provisions of section 138 of the Companies Act, 2013.
2.07 The Financial Statements for the year ended 31st March, 2015 have
been prepared on a "going concern basis" as the long term prospects
appear better for the paper industry as also in view of the
reliefs/concessions that the Company has obtained on sanction of
rehabilitation package by the Board of Industrial and Financial
Reconstructions (BIFR).
2.08 a) The Company had submitted Draft Rehabilitation Scheme as per
the direction given (including for restructuring of Loans) by Hon'ble
BIFR, vide summary of proceedings dated 28th September 2010 through its
Operating Agency namely IDBI. The Hon'ble BIFR approved the scheme and
passed the sanction order on dated 14th February 2012.
b) The Company being aggrieved by certain directions of the summary of
proceedings passed by Hon'ble BIFR, has filed an appeal with Hon'ble
Appellate Authority for Industrial and Financial Reconstruction (AAIFR)
against the direction given by Hon'ble BIFR for reducing the capital of
company. Hon'ble Appellate Authority for Industrial and Financial
Reconstruction (AAIFR) has remanded back the matter involved in appeal
to Hon'ble BIFR and deciding the issue afresh. Now Hon'ble BIFR vide
Order dated 01/07/2013 approved reduction of Capital. The existing
share capital of the company shall be reduced by 95% by writing off
accumulated losses to that extent and then every twenty equity shares
ofRs. 0.50/- each are to be consolidated into one equity share of Rs.
10/- each fully paid up in terms of sec. 18(2) (f) of the SICA without
the requirement of following the provisions of section 100-103 of the
erstwhile Companies Act, 1956 and without following any guidelines of
SEBI/ BSE / ASE or any other guidelines. Reduction of share capital as
per above order has taken place on 30.05.2014.
c) The Company has allotted 2,000,000 equity shares of Rs.10/- each on
31.05.2014 against the conversion of secured loan of Arc- Trust as per
BIFR order dated 01.07.2013. Further the Company has made preferential
allotment of shares as follows on 31.05.2014 with a lock in period of 3
years
2.09 Deferred Sales Tax liability under 1988 Package Scheme of
Incentives of the Government of Maharashtra is repayable in five annual
installments after 10 years from the respective years, after the
commencement date i.e., 1st October 2000. Hon'ble BIFR in its sanction
scheme dated 14/02/12 directed to State Govt. to consider the repayment
period of the deferred sales tax liability by eight years from the due
date for the respective installments against the existing outstanding
without charging any interest during the extended period. The
extension is pending; hence the contingent liability arising in the
event of non-extension is not ascertainable.
2.10 Repayment Schedule, as per sanction order dt. 14/02/2012 of
Hon'ble BIFR towards repayment to secured and unsecured borrowings and
their overdue as on 31March 2015 is as under:
i) Arc-Trust: Balance as on 31 December 2008 of Rs.237,200,000 to be
converted into non-convertible debentures and redeemed along with
premium of Rs. 98,800,000, amounting toRs.336,000,000 in 16 quarterly
installments w.e.f 31.12.2008.In addition to this Arc Trust to
subscribe 2,000,000 equity shares of Rs.10 each at par aggregating to
Rs. 20,000,000. These shares have been issued in dematerialized form.
There is an overdue principal amount as on 31 March 2015 of Rs.104,
910,000(Previous year Rs.106, 410,000) and un -provided interest of
Rs.128,640,719 (Previous year Rs115,433,476)
ii) IFCI: The Dues payable to IIBI have been taken over by IFCI.
Hon'ble BIFR Substituted name of Industrial Investment Bank of India
(IIBI) to Industrial Finance Corporation of India (IFCI) , Therefore
dues payable to IIBI are now shown payable to IFCI. Repayment is to be
made in 16 equal quarterly installments of Rs.512,500 per quarter along
with simple interest @ 12.50% p.a. on reducing balance method w.e.f.
from 14.02.12(date of sanction of scheme).There is Rs. 6,554,733
(Previous year Rs.8,828,689) overdue as on 31 March 2015.
iii) MSFC: Repayment was scheduled in 16 equal quarterly installments
of Rs.937, 500 per Quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12 (date of sanction of
scheme). During the year OTS scheme granted as per letter
No:.MSFC/HO/NPPML/2014-15/108, dated 5.11.2014 according to which Rs.6,
000,000 payable in 15 monthly installments starting from 1.12.2014.
There is Rs.4, 00,000(previous year Rs. 10,861,925) overdue as on 31
March 2015.
2.11 Overdue installments of financial Institutions as on 31 March
2015 are recognized as long term Borrowings instead of current
liabilities as required under Schedule III. Outstanding balances as on
31st March 2015 subject to reconciliation.
2.12 Pursuant to the enactment of Companies Act 2013, the company has
applied the estimated Useful lives as specified in Schedule II.
Accordingly the unamortized carrying value is being depreciated /
amortized over the revised/remaining useful lives. The written down
value of Fixed Assets whose lives have expired as at 1st April 2014
have been adjusted in the opening balance of Profit and Loss Account.
NOTE 3: DISCLOSURES UNDER ACCOUNTING STANDARDS
3.01 Employee benefit plans
Defined contribution plans
The Company makes Provident Fund contribution to defined contribution
plan for qualifying employees. Under the Scheme, the Company is
required to contribute a specified percentage of the payroll costs to
fund the benefits. The Company recognized Rs.2, 762,043 (Year ended 31
March, 2014 Rs.3, 033,863) for Provident Fund contribution in the
Statement of Profit and Loss. The contribution payable to this plan by
the Company is at the rates specified in the rules of the schemes.
Defined benefit plans
The Company offers the following employee benefit schemes to its
employees:
3.02 Related Party Transactions Details of related parties:
Associates
1. Nath Bio-Genes (India) Ltd.
2. Nath Nirman Infra Pvt. Ltd.
3. Tapovan International Trading Pvt. Ltd.
4. Nath Industrial & Chemicals Ltd.
Key Management Personnel (KMP)
Mr. Akash N. Kagliwal (Whole Time Director)
Mr. Vijay L. Saboo (CFO)
Relatives of KMP
Mr. Nandkishor Kagliwal (Father of Mr. Akash Kagliwal)
NOTE 4: PREVIOUS YEAR FIGURES:
The financial statements for the year ended March 31, 2015 are prepared
as per Schedule III of the Companies Act, 2013. Accordingly, the
previous year figures have also been reclassified to conform to this
Year's classification.
Mar 31, 2014
I) Capital work-in-progress includes advance of Rs 1,911,195 (Previous
year Rs 1,911,195} in respect of various plots of Agricultural Land,
possession taken by the Company pursuant to the Agreement to Sale,
pending payment of balance amount and registration in the name of the
company and on payment of prescribed stamp duty and relevant expenses.
(Amount not ascertained)
ii) The Company is in possession of Lease hold land admeasuring 87 acre
34 guntha at Issarwadi Paithan, pursuant to Agreement to lease with
Maharashtra Waqf Board entered in the year 1985 for 51 years, for which
final Lease deed is yet to be executed.
iii) Depreciation and amortization
Note 2: ADDITIONAL INFORMATION TO THE FINANCIAL STATEMENTS
2.01 Contingent Liabilities and Capital Commitments (to the extent not
provided for)
Particulars As at 31 March, As at 31 March,
2014 2013
(i) Contingent liabilities
(a) Claims against the Company not
acknowledged as debts
(i) Disputed Demands of Central Excise 5,568,659 5,568,659
(ii) Disputed demands of Sales Tax 19,817,049 19,817,049
(iii) Disputed demands of Water Cess
(including interest upto the date 1,598,193 1,598,193
of demand)
(iv) Disputed demand of Property Tax
from Gram Panchayat 2,755,934 2,755,934
(v) Deferred sales tax Liability
transferred to another Company (with 158.636.440 158.636.440
recourse)
(vi) Amount of interest liability/ Amount presently Amount presently
penalty, if any on delayed / unascertamable unascertainable
non-deduction/ non-payments
of certain creditors/ loans
/ debenture trustee remuneration
/statutory dues /Lease liability/
penal interest/ liquidated damages
on secured /unsecured borrowings /
Redeemable Bonds/ Labour related
liability
(vii) Claims against the Company
not acknowledged as debt. 850,000 850,000
(b) Guarantees - -
(c) Other money for which the
Company is contingently liable:
(i) Liability that may arise on account
of waiver being withdrawn with Amount Amount
retrospective effect due to default Unascertainable Unascertainable
in repayment to Arc Trust.
(ii) Liability that may arise on account
of non extension of Package
Scheme of Incentives by eight year
by Govt, of Maharashtra as Amount presently Amount presently
per sanction order of Hon''ble BIFR unascertainable unascertainable
dt. 14/02/12. Refer Note No.
27.15 below.
(ii) Capital Commitments
(a) Estimated amount of contracts
remaining to be executed on
capital account and not provided for
Tangible assets 2,955,914 2,955,914
2.02 Disclosures required under section 22 of the Micro, Small and
Medium Enterprises Development Act, 2006.
Dues to Micro and Small Enterprises have been determined to the extent
such parties have been identified on the basis of information collected
by the Management and relied upon by the auditors.
The company has compiled the above information based on confirmations
from some suppliers. As at the year end, no other supplier has
intimated the company about its status as a Micro, Small & Medium
Enterprises or its registration under the Micro, Small & Medium
Enterprises Development Act 2006. No interest payment is likely to be
made to unsecured creditors as per sanction order of Hon''ble BIFR dt.
14/02/12 and hence, no interest liability in respect of above category
of creditors is provided / disclosed.
2.03 Land, certain Buildings and Plant and Machinery were revalued as
on June 30, 1994 and the resultant increase in value amounting to Rs
3,77,23,368 for Land , 1,75,87,749 for Buildings and Rs.6,66,86,621 for
Plant and Machinery aggregating to Rs.12,19,97,738 had been transferred
to Revaluation reserve . The Valuation was carried out by an external
approved valuer on the basis of replacement value of similar assets
after considering the obsolescence and age of individual asset.
The following revalued amounts (net of withdrawals) remain substituted
for the historical cost in the gross block of Fixed Assets.
2.04 The Company is making concerted efforts to appoint a Whole time
Company Secretary as required under the provisions of Section 383 A of
the Companies Act, 1956.
2.05 (a) The accounts of certain Debtors, Creditors / Loans given are
subject to confirmations, reconciliations and adjustments, if any,
having consequential impact on the profit for the year, assets and
liabilities, the amounts whereof are presently not ascertainable.
However, the management does not expect any material difference in the
above accounts affecting the current year''s financial statements.
(b) In the opinion of management. Current Assets have a value on
realization in the ordinary course of business at least equal to the
amount at which they are stated.
2.06 In the opinion of the management, the Company is mainly engaged
in the business of manufacturing of paper. As such, there are no
separate reportable segments.
(i) In respect of the above parties, rate of interest is Nil.
(ii) In respect of loans/advances referred to above, in view of
financial exigencies, the Company has not complied with Section 372A of
the Act, in as much as these are interest free loans and approval of
financial institutions has not been obtained.
2.07 The Company is in the process of getting its cost records audited
by a cost auditor for the current financial year as required under the
provisions of Section 233B of the Companies Act, 1956.
2.08 The Financial Statements for the year ended 31st March, 2014 have
been prepared on a "going concern basis" as the long term prospects
appear better for the paper industry as also in view of the
reliefs/concessions that the Company has obtained on sanction of
rehabilitation package by the Board of Industrial and Financial
Reconstructions (BIFR).
2.09 (a) The Company had submitted Draft Rehabilitation Scheme as per
the direction given (including for restructuring of Loans) by
Hon''ble BIFR, vide summary of proceedings dated 28th September 2010
through its Operating Agency namely IDBI. The Hon''ble BIFR approved
the scheme and passed the sanction order on dated 14th February 2012.
(b) The Company being aggrieved by certain directions of the summary of
proceedings passed by Hon''ble BIFR, has filed an appeal with Hon''ble
Appellate Authority for Industrial and Financial Reconstruction (AAIFR)
against the direction given by Hon''ble BIFR for reducing the capital of
company. Hon''ble Appellate Authority for Industrial and Financial
Reconstruction (AAIFR) has remanded back the matter involved in appeal
to Hon''ble BIFR and deciding the issue afresh. Now Hon''ble BIFR vide
Order dated 01/07/2013 approved reduction of Capital has the existing
share capital of the company shall be reduced by 95% by writing off
accumulated losses to that extent and then every twenty equity shares
of Rs. 0.50/- each are to be consolidated into one equity share of Rs.
10/- each fully paid up in terms of sec. 18(2) (f) of the SICA without
the requirement of following the provisions of section 100-103 of the
Companies Act, 1956 and without following any guidelines of SEBI/ BSE /
ASE or any other guidelines.
2.10 Deferred Sales Tax liability under 1988 Package Scheme of
Incentives of the Government of Maharashtra is repayable in five annual
installments after 10 years from the respective years, after the
commencement date i.e., 1st October 2000. Hon''ble BIFR in its sanction
scheme dated 14/02/12 directed to State Govt, to consider the repayment
period of the deferred sales tax liability by eight years from the due
date for the respective installments against the existing outstanding
without charging any interest during the extended period. The extension
is pending, hence the contingent liability arising in the event of non-
extension is not ascertainable.
2.11 Repayment Schedule, as per sanction order dt. 14/02/2012 of
Hon''ble BIFR towards repayment to secured and unsecured borrowings and
their overdue as on 31March 2014 is as under:
i) Non-Convertible Debentures: Repayment of said debentures are
scheduled in 16 equal quarterly installments w.e.f 14.02.2012 (date of
sanction of scheme) to Indian Bank MF Rs.78, 125 and to SBI MF Rs.
234,375 per quarter along with simple interest @ 12.50% p.a. on
reducing balance method .There is Rs. 487,904 (previous year Rs. 146,871)
overdue amount as on 31 March 2014.
ii) Arc-Trust: Balance as on 31 December 2008 of Rs. 237,200,000 to be
converted into non convertible debentures and redeemed along with
premium of Rs. 98,800,000, amounting to total Rs. 336,000,000 in 16
quarterly installments w.e.f 31.12.2008. In addition to this Arc Trust
to subscribe 2,000,000 equity shares of Rs.10 each at par aggregating to
Rs. 20,000,000. These shares would be issued in dematerialized form and
will be with lock-in requirements. There is an overdue principal amount
as on 31 March 2014 of Rs. 106,410,000 (previous year Rs. 121,910,000)
and un -provided interest of Rs. 115,433,476 (previous yearRs
101,709,966)
iii) HDFC: Repayment is to be made in 16 equal quarterly installments
ofRs. 45938/- per quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12 (date of sanction of
scheme).There is Rs.49,745 (previous year Rs Nil) overdue amount as on
31 March 2014.
iv) IFCI: The Dues payable to IIBI have been taken over by IFCI.
Hon''ble BIFR Substituted name of Industrial Investment Bank of India
(IIBI) to Industrial Finance Corporation of India (IFCI), Therefore
dues payable to IIBI are now shown payable to IFCI. Repayment is to be
made in 16 equal quarterly installments of Rs.512,50Q per quarter along
with simple interest @ 12.50% p.a. on reducing balance method w.e.f.
from 14.02.12(date of sanction of scheme).There is Rs. 8,828,689
(previous year Rs 8,078,8871) overdue as on 31 March 2014.
v) MSFC: Repayment is scheduled in 16 equal quarterly installments of
Rs.937, 500 per Quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12 (date of sanction of
scheme). There is Rs. 10,861,925 (previous year Rs. 9,293,913) as on 31
March 2014.
2.12 Over due installments of financial Institutions as on 31 March
2014 are recognized as long term Borrowings instead of current
liabilities as required under revised schedule VI. Outstanding balances
as on 31st March 2014 subject to reconciliation.
Note 3: DISCLOSURES UNDER ACCOUNTING STANDARDS
3.01 Employee benefit plans Defined contribution plans
The Company makes Provident Fund contribution to defined contribution
plan for qualifying employees. Under the Scheme, the Company is
required to contribute a specified percentage of the payroll costs to
fund the benefits. The Company recognized Rs 3,043,313 (Year ended 31
March, 2013 Rs 2,885,846) for Provident Fund contribution in the
Statement of Profit and Loss. The contribution payable to this plan by
the Company is at the rates specified in the rules of the schemes.
Defined benefit plans
The Company offers the following employee benefit schemes to its
employees:
ii) Para 132 of Accounting Standard 15 (Revised 2005) does not require
any specific disclosures except where expense resulting from
compensative absence is of such size, nature or incidence that its
disclosure is relevant under Accounting Standard 5 or Accounting
Standard 18. In the opinion of the management, the expense resulting
from compensated absence is not significant and hence disclosures under
various paragraphs of Accounting Standard 15 (Revised 2005) are not
applicable. The liability for leave entitlement and compensated
absences as at period end is Rs.3, 392,369 (March 31, 2013 Rs.3,336,154).
3.02 Related Party Transactions
Details of related parties:
Associates
1. Nath Seeds Ltd.
2. Nath Industrial & Chemicals Ltd.
3. Nath Bio-Genes (India) Ltd.
4. Nath Nirman Infra Pvt. Ltd.
Key Management Personnel (KMP)
Mr. Akash N. Kagliwal (Whole Time Director)
Relatives of KMP
Mr. Nandkishor Kagliwal (Director and Father of Mr. Akash Kagliwal)
As per AS - 22 "Accounting for taxes on Income" Deferred Tax Assets are
recognized and carried forward to the extent that there is a reasonable
certainty that sufficient future taxable income will be available
against which Deferred Tax Assets can be realized. Deferred tax assets
are reviewed at each Balance Sheet Date.
The Company has recognized deferred tax asset on unabsorbed
depreciation and brought forward business losses based on the
Management''s estimates of future profits of the Company.
Note 4: PREVIOUS YEAR FIGURES
The financial statements for the year ended March 31, 2014 are prepared
as per Revised Schedule VI. Accordingly, the previous year figures have
also been reclassified to conform to this year''s classification.
Mar 31, 2013
1.01 Contingent Liabilities and Capital Commitments (to the extent not
provided for)
Particulars As at 31
March, 2013 As at 31
March, 2012
(i) Contingent liabilities
(a) Claims against the Company
not acknowledged as debts
(i) Disputed Demands of Central
Excise 5,568,659 5,568,659
(ii) Disputed demands of Sales Tax 19,817,049 19,817,049
(iii) Disputed demands of Water Cess
(including interest upto the date
of demand) 1,598,193 1,598,193
(iv) Disputed demand of Property Tax
from Gram Panchayat 2,755,934 2,755,934
(v) Deferred sales tax Liability
transferred to another Company
(with recourse) 158,636,440 158,636,440
(vi) Amount of interest liability/
penalty, if any on delayed
/non-deduction/ non-payments of
certain creditors/ loans/ Amount
presently Amount presently
debenture trustee remuneration /
statutory dues /Lease
unascertainable unascertainable
liability/ penal interest/
liquidated damages on secured
/unsecured borrowings /
Redeemable Bonds/ Labour related
liability
(vii) Claims against the Company
not acknowledged as debt. 850,000 850,000
(b) Guarantees
(c) Other money for which the Company
is contingently liable:
ii Amount Amount
i Liability that may arise on account of
waiver being withdrawn A
Unascertainable Unascertainable
with retrospective effect due to
default in repayment to Arc
Trust.
(ii) Liability that may arise on
account of non extension of
Amount Amount
Unascertainable Unascertainable
Maharashtra as per sanction order of
Hon ble BIFR dt.
14/02/12. Refer Note No. 27.15 below.
(ii) Capital Commitments
(a) Estimated amount of contracts
remaining to be executed on
capital account and not provided
for Tangible assets 3,671,537 3,671,537
1.02 Disclosures required under section
22 of the Micro, Small and
Medium Enterprises Development
Act, 2006.
Principal amount remaining unpaid to
any supplier as at the end of 192,243 263,041
the accounting year
Dues to Micro and Small Enterprises have been determined to the extent
such parties have been identified on the basis of information collected
by the Management. This has been relied upon by the auditors.
The company has compiled the above information based on confirmations
from some suppliers. As at the year end, no other supplier has
intimated the company about its status as a Micro, Small & Medium
Enterprises or its registration under the Micro, Small & Medium
Enterprises Development Act 2006. No interest payment is likely to be
made to unsecured creditors as per sanction order of Hon''ble BIFR dt.
14/02/12 and hence, no interest liability in respect of above category
of creditors is provided / disclosed.
1.03 Land, certain Buildings and Plant and Machinery were revalued as
on June 30, 1994 and the
resultant increase in value amounting to ? 3,77,23,368 for Land , ?
1,75,87,749 for Buildings ?.6,66,86,621 for Plant and Machinery
aggregating to ?. 12,19,97,738 had been transferred to Revaluation
reserve . The Valuation was carried out by an external approved valuer
on the basis of replacement value of similar assets after considering
the obsolescence and age of individual asset.
1.04 The Company is making concerted efforts to appoint a Whole time
Company Secretary as required under the provisions of Section 383 A of
the Companies Act, 1956.
1.05 (a) The accounts of certain Debtors, Creditors / Lenders given
are subject to confirmations, reconciliations and adjustments, if any,
having consequential impact on the profit for the year, assets and
liabilities, the amounts whereof are presently not ascertainable.
However, the management does not expect any material difference in the
above accounts affecting the current year''s financial statements.
(b) In the opinion of management, Current Assets have a value on
realization in the ordinary course of business at least equal to the
amount at which they are stated. 27.08 In the opinion of the
management, the Company is mainly engaged the business of manufacturing
of paper. As such, there are no separate reportable segments.
(i) In respect of the above parties, rate of interest is Nil.
(ii) In respect of loans/advances referred above, in view of financial
exigencies, the Company has not complied with Section 372 A of the Act,
in as much as these are interest free loans and approval of financial
institutions has not been obtained.
1.06 The Company is in the process of getting its cost records audited
by a cost auditor for the current financial year as required under the
provisions of Section 233B of the Companies Act, 1956.
1.07 The Financial Statements for the year ended 31st March, 2013 have
been prepared on a "going concern basis" as the long term prospects
appear better for the paper industry as also in view of the
reliefs/concessions that the Company has obtained on sanction of
rehabilitation package by the Board of Industrial and Financial
Reconstructions (BIFR).
1.08 (a) The Company had submitted Draft Rehabilitation Scheme as per
the direction given (including for restructuring of Loans) by Hon''ble
BIFR, vide summary of proceedings dated 28th September 2010 through its
Operating Agency namely IDBI. The Hon''ble BIFR approved the scheme and
passed the sanction order on dated 14th February 2012.
(b) The Company being aggrieved by certain directions of the summary of
proceedings passed by Hon''ble BIFR , has filed an appeal with Hon''ble
Appellate Authority for Industrial and Financial Reconstruction (AAIFR)
against the direction given by Hon''ble BIFR for reducing the capital of
company. Hon''ble Appellate Authority for Industrial and Financial
Reconstruction (AAIFR) has remanded back the matter involved in appeal
to Hon''ble BIFR for deciding the issue afresh.
1.09 Deferred Sales Tax liability under 1988 Package Scheme of
Incentives of the Government of Maharashtra is repayable in five annual
installments after 10 years from the respective years, after the
commencement date i.e., 1st October 2000. Hon''ble BIFR in its sanction
scheme dated 14/02/12 directed to State Govt, to consider the repayment
period of the deferred sales tax liability by eight years from the due
date for the respective installments against the existing outstanding
without charging any interest during the extended period. The extension
is pending, hence the contingent liability arising in the event of
non-extension is not ascertainable.
1.10 Repayment Schedule, as per sanction order dt. 14/02/2012 of
Hon''ble BIFR towards repayment to secured and unsecured borrowings and
their overdue as on 31 March 2013 is as under:
i) Non-Convertible Debentures: Repayment of said debentures are
scheduled in 16 equal quarterly installments w.e.f 14.02.2012 (date of
sanction of scheme) to Indian Bank MF ?.78,000 and to SBI MF ?. 234,000
per quarter along with simple interest @ 12.50% p.a. on reducing
balance method .There is ? 146,871(Previous Year Nil) overdue amount as
on 31 March 2013.
ii) Arc-Trust: Balance as on 31 December 2008 of ?. 237,200,000 to be
converted into non convertible debentures and redeemed along with
premium of ?.98,800,000, amounting to total ?.336,000,000 in 16
quarterly installments w.e.f 31.12.2008. In addition to this Arc Trust
to subscribe 2,000,000 equity shares of ?. 10 each at par aggregating
to ?.20, 000,000. These shares would be issued in dematerialized form
and will be with lock-in requirements. There is an overdue principal
amount as on 31 March 2013 of ?.121, 910,000 (Previous Year ?
134,110,000) and unprovided interest of?. 101,709,966 (Previous Year ?
147,768,520).
iii) HDFC: Repayment is to be made in 16 equal quarterly installments
of?. 46,000 per quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12 (date of sanction of
scheme) .There is no overdue amount as on 31 March 2013 (Previous Year
? Nil).
i) IIBI: Repayment is to be made in 16 equal quarterly installments of
?.512,500 per quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12(date of sanction of
scheme) .There is overdue of? 8,078,887 (Previous year ? 3,075,000) as
on 31 March 2013.
ii) MSFC: Repayment is scheduled in 16 equal quarterly installments of
?.937,500 per Quarter along with simple interest @ 12.50% p.a. on
reducing balance method w.e.f. from 14.02.12 (date of sanction of
scheme). There is an overdue amount of ?.9,293,913 (Previous Year ?
312,500) as on 31 March 2013.
1.11 Over due installments of financial Institutions as on 31 March
2013 are recognized as long term
Borrowings instead of current liabilities as required under revised
schedule VI. Outstanding balances as on 31 st March 2013 subject to
reconciliation.
Note 2: DISCLOSURES UNDER ACCOUNTING STANDARDS 28.01 Employee benefit
plans
Defined contribution plans
The Company makes Provident Fund contribution to defined contribution
plan for qualifying employees. Under the Scheme, the Company is
required to contribute a specified percentage of the payroll costs to
fund the benefits. The Company recognized ? 2,885,846 (Year ended 31
March, 2012 ? 2,685,019) for Provident Fund contribution in the
Statement of Profit and Loss. The contribution payable to this plan by
the Company is at the rates specified in the rules of the schemes.
Defined benefit plans
The Company offers the following employee benefit schemes to its
employees:
ii) Para 132 of Accounting Standard 15 (Revised 2005) does not require
any specific disclosures except where expense resulting from
compensative absence is of such size, nature or incidence that its
disclosure is relevant under Accounting Standard 5 or Accounting
Standard 18. In the opinion of the management, the expense resulting
from compensated absence is not significant and hence disclosures under
various paragraphs of Accounting Standard 15 (Revised 2005) are not
applicable. The liability for leave entitlement and compensated
absences as at period end is .3,336,154 (March 31,2012 ?.2,849,329).
2.01 Related Party Transactions Details of related parties:
Associates
1. Nath Seeds Ltd.
2. Nath Industrial & Chemicals Ltd.
3. Nath Bio-Genes (India) Ltd.
4. Nath Nirman Infra Pvt. Ltd.
Key Management Personnel (KMP)
Mr. Akash N. Kagliwal (Whole Time Director)
Relatives of KMP
Mr. Nandkishor Kagliwal (Director and Father of Mr. Akash Kagliwal)
As per AS - 22 "Accounting for taxes on Income" Deferred Tax Assets are
recognized and carried forward to the extent that there is a reasonable
certainty that sufficient future taxable income will be available
against which Deferred Tax Assets can be realized. Deferred tax assets
are reviewed at each Balance Sheet Date.
The Company has recognized deferred tax asset on unabsorbed
depreciation and brought forward business losses based on the
Management''s estimates of future profits of the Company.
Note 3: PREVIOUS YEARS FIGURES
The financial statements for the year ended March 31, 2013 are prepared
as per Revised Schedule VI. Accordingly, the previous year figures
have also been reclassified to conform to this year''s classification.
Mar 31, 2010
1. Land, certain Buildings and Plant and Machinery were revalued as on
June 30,1994 and the resultant increase in value amounting to Rs.
377.23 lacs for Land ,Rs.175.85 lacs for Buildings and Rs. 666.87 lacs
for Plant and Machinery aggregating to Rs. 1219.98 lacs had been
transferred to Revaluation reserve. The Valuation was carried out by an
external approved valuer on the basis of replacement value of similar
assets after considering the obsolescence and age of individual asset.
2. The Financial Statements for the year ended 31st March, 2010 have
been prepared on a "going concern basis" as the long term prospects
appear better for the paper industry as also in view of the expected
reliefs/concessions that the Company may get, on sanction of
rehabilitation package by the Board of Industrial and Financial
Reconstructions (BIFR). (Also refer Note No. 9 below).
3. Based on legal opinion in the matter taken by others, the
provisions of Section 274(1) (g) of the Companies Act, 1956, dealing
with the disqualification of directors of the same Company for unpaid
deposits, redeemable debentures, interest thereon and unpaid dividend
are not applicable to the Company.
4. The Company is making efforts to appoint a Whole time Company
Secretary as required under the provisions of Section 383 A of the
Companies Act, 1956.
5. a) Sundry Credit Balances Written Back includes forfeiture of Share
Application Money amounting to Rs. 5,750,000, because of
Non-compliance by respective warrant holders.
b) During the year Loss arising out of Fire on the wast paper, has been
accounted for Rs. 1,071,908 (net of Insurance claimed received rs.
970,000) the same has been shown under exceptional items aggregating to
Rs. 101,908, in the financial statement for the year.
6. a) The accounts of certain Debtors, Creditors / Lenders and
Loans and advances given are subject to confirmations, reconciliations
and adjustments, if any, having consequential impact on the loss for
the year, assets and liabilities, the amounts whereof are presently not
ascertainable. However, the management does not expect any material
difference in the above accounts affecting the current years financial
statements.
b) In the opinion of management, Current Assets, Loans and Advances
have a value on realization in the ordinary course of business at least
equal to the amount at which they are stated.
7. The balance of Rs. 514,512 lying in the dividend account of the
Companys bankers is under reconciliation with reference to the direct
payments made by the Company through other bank accounts and unencashed
dividend warrants. Pending such reconciliations, dividend amounts
remaining unpaid and outstanding for more than 3 years upto 31/10/1998
could not be transferred to revenue account of the Central Government
as required under Section 205A of the Act. The Company is in the
process of complying with the provisions.
8. a) During the year, the Company has submitted revised Draft
Rehabiliation Scheme (including for restructuring of Loans) to the
Honble BIFR through its Operating Agency namely IDBI, which is pending
before the Honble BIFR.
b) The Company has not paid installments due in respect of certain
debts as per the letter of assignment of loan of ARCIL. Consequently,
the lender shall have the right to revoke the assignment in case of non
fulfillment of commitment and have the right to convert entire part
of loan outstanding into equity. The Company has not provided for
interest on the amount settled with ARCIL.
c) The Company has not provided for interest on the amount settled with
MSFC, since the same will become payable only after sanctioning of the
Scheme by Honble BIFR, as per the terms of the Scheme.
9. Disclosure in accordance with Section 22 of Micro, Small Medium
Enterprises development Act, 2006.
10. Profit and Loss on sale of raw materials and stores are not
ascertained/ shown separately and the sale proceeds have been credited
to the respective accounts.
11. The Management is of the opinion that, there will be adequate
future taxable income against which, deferred tax assets will be
realised.
12. In the opinion of the management, the Company is mainly engaged in
the business of manufacturing of paper. As such, there are no separate
reportable segments.
13. Deferral of Sales Tax under 1988 Package Scheme of Incentives of
the Government of Maharashtra is repayable in five annual installments
after 10 years from respective years, after the commencement date i.e.,
1 October 2000.
14. Loans and Advances in the nature of loans where there is no
repayment schedule or no interest or at an interest rate below what is
specified in Section 372A of the Act:
In respect of the above parties, rate of interest is Nil û
In respect of loans/advances referred above, in view of financial
exigencies, the Company has not complied with Section 372A of the Act,
in as much as these are interest free loans and approval of the
financial institutions has not been obtained.
15. Related Parties Disclosure as per Accounting Standard 18 :
a) List of Related Parties:
Parties with whom the Company has entered into transactions during the
year
Associates:
Nath Seeds Ltd.
Nath Industrial Chemicals Ltd.
Paresh Farms Pvt. Ltd.
Nath Bio-Genes (India) Ltd.
b) Key Managerial Personnel
Mr. Akash Kagliwal (Whole time Director)
NOTE:
a) No amount pertaining to associates has been provided for as doubtful
debt. Also no amount has been written
off/back during the year.
b) Related parties are as identified by the Company and relied upon by
the Auditors.
16. As per requirement of Accounting Standard 15 (Revised) Employees
Benefit, the Company has provided for actuarial liability as per the
figures confirmed by the Life Insurance Corporation of India. However,
the report as required for disclosure of defined benefit scheme is
awaited.
17. Previous years figures have been regrouped / rearranged wherever
necessary to conform to the current years presentation.
Mar 31, 2009
1. A) Contingent Liabilities not provided for in respect of the
following:
Sr.No Particulars Year ended Year ended
31st March, 2009 31st March, 2008
I Disputed demands of
Central Excise 5,297,335 5,297,335
(excluding interest
thereon)
II Disputed demands of
sales tax 19,817,049 20,255,240
(excluding interest
thereon)
III Deferred sales tax
Liability transferred
to another 158,636,440 147,976,214
Company (with recourse)
IV Lease Liability
transferred to another
Company 21,038,923 33,538,923
(With recourse)
V Amount of interest
liability/ penalty,
if any on delayed /
non-deduction/
non-payments of certain
creditors/ loans/
debenture trustee
remuneration/ Amount presently Amount presently
statutory dues / Lease
liability / penal
interest / unascertainable unascertainable
liquidated damages on
secured / unsecured
borrowings / Redeemable
Bonds
VI Claims against the
Company not acknowledged 850,000 Ã
as debt.
B. Estimated amount of contracts
fremaining to be executed
on capital account and not provided for
(net of advances) 4,757,582 4,757,818
2. Land, certain Buildings and Plant and Machinery were revalued as on
June 30, 1994 and the resultant increase in value amounting to Rs.
377.23 lacs for Land ,Rs. 175.85 lacs for Buildings and Rs. 666.87 lacs
for Plant and Machinery aggregating to Rs. 1219.98 lacs had been
transferred to Revaluation reserve. The Valuation was carried out by
an external approved valuer on the basis of replacement value of
similar assets after considering the obsolescence and age of individual
asset.
3. The Financial Statements for the year ended 31st March, 2009 have
been prepared on a "going concern basis" as the long term prospects
appear better for the paper industry as also in view of the expected
reliefs/concessions that the Company may get, on sanction of
rehabilitation package by the Board of Industrial and Financial
Reconstructions (BIFR) and also relief under the scheme of
arrangement/compromise under section 391 of the Companies Act, pending
sanction by Honble Bombay High Court. (Also refer Note No. 9 below).
4. Based on legal opinion in the matter taken by others, the
provisions of Section 274(1) (g) of the Companies Act, 1956, dealing
with the disqualification of directors of the same Company for unpaid
deposits, redeemable debentures, interest thereon and unpaid dividend
are not applicable to the Company.
5. The Company is making efforts to appoint a Whole time Company
Secretary as required under the provisions of Section 383 A of the
Companies Act, 1956.
6. Loans and Advances include Deposit given to associate companies
towards office premises taken on lease amount to Rs.23,000,000
(previous year Rs.23,000,000)
7. a) The accounts of certain Debtors, Creditors / Lenders and Loans
and advances given are subject to confirmations, reconciliations and
adjustments , if any, having consequential impact on the profit for
the year, assets and liabilities, the amounts whereof are presently
not ascertainable. However, the management does not expect any material
difference in the above accounts affecting the current years financial
statements.
b) In the opinion of management, Current Assets, Loans and Advances
have a value on realization in the ordinary course of business at least
equal to the amount at which they are stated.
8. The balance of Rs. 514,512 lying in the dividend account of the
Companys bankers is under reconciliation with reference to the direct
payments made by the Company through other bank accounts and unencashed
dividend warrants. Pending such reconciliations, dividend amounts
remaining unpaid and outstanding for more than 3 years upto 31/10/1998
could not be transferred to revenue account of the Central Government
as required under Section 205A of the Act. The Company is in the
process of complying with the provisions.
9. The Company has submitted a Scheme of Arrangement/ Compromise
between the Company and its Secured Creditors with the Honourable
Bombay High Court under Section 391 of the Companies Act, 1956.
Pursuant to the Court Order, the Company had convened a meeting of the
Secured Creditors on the 12th of June, 2004 in which more than 3/4th of
the Secured Creditors in value and number had approved the said Scheme
and a petition has since been filed before the Honourable Bombay High
Court for sanction of the Scheme.
a) Pending sanction of the scheme, the Company has reached a negotiated
settlement with Financial Institutions/ Banks for a comprehensive
restructuring of Companys debts and liabilities which, inter alia,
provide for waiver of interest and relief in the repayment of principal
amount; consequently, the consenting Financial Institutions i.e.
IDBI.ICICI, IFCI, UTI and LIC and Banks i.e. State Bank of India &
State Bank of Hyderabad have assigned their respective dues to Asset
Reconstruction Company (India) Ltd. (ARCIL). The effect of
restructuring package to the extent of revision in outstanding
principal and waiver of interest, have been given in the accounts.
b) SBI Mutual Fund, Indian Bank Mutual Fund, IRBI and Mandvi Co op Bank
have not consented to the said restructuring of debts. Company has,
however, considered certain relief from them on the premise that, they
would fall in line with other Financial Institutions and Banks. IDBI
(implementing agency) has also submitted DRS (Debt Rehabiliation
Scheme) on the same premise to the Honble BIFR, which is under their
consideration. The impact of above relief are detailed below:
c) The Company has not paid installments due in respect of certain
debts as per the letter of assignment of loan to ARCIL and settlement
with MSFC, Consequently the lenders shall have the right to revoke the
assignment in case of non fulfillment of commitment and have the right
to convert entire/part of loan outstanding into equity.
d) The Company has not provided for interest on the amount settled with
ARCIL & MSFC, since the same will become payable only after sanctioning
of the Scheme by Honble BIFR, as per the terms of DRS.
10. During the year, the Company has written off Stocks of Unusable /
Unserviceable Raw Materials amounting to Rs. 75,266,813 in view of
abnormal deterioration in the quality of the material during the year
as evaluated by the management. The same has been shown under
exceptional items in the financial statements for the year.
11. Profit and Loss on sale of raw materials and stores are not
ascertained/ shown separately and the sale proceeds have been credited
to the respective accounts.
12. Having regard to time restrictions on carry forward of the losses
incurred in the earlier years and as a matter of prudence, the
management has not recognized the net deferred tax assets (Deferred tax
assets in respect of unabsorbed carried forward losses/depreciation /
expenditure allowable on payment basis and deferred tax liability on
account of depreciation /amortization) for period upto March 31 , 2009.
13. In the opinion of the management, the Company is mainly engaged in
the business of manufacturing of paper. As such, there are no separate
reportable segments.
14. Deferral of Sales Tax under 1988 Package Scheme of Incentives of
the Government of Maharashtra is repayable 1st in five annual installments
after 10 years from the date of availment i.e., 1 October 2000.
15. During the year, the Company has recognized the Sales Tax
Liability for the year, scheduled for repayment from the year 2019 to
2023 aggregating to Rs 10,660,226. (Previous year Rs. 26,020,758) at
its net present value aggregating to Rs.2,985,264(Previous year
Rs.7,286,800). Surplus resulting from the transaction of Rs.7, 674,962
(Previous year 18,733,958) has been credited to profit and loss
account.
16. Liabilities towards Leave Entitlement have been provided for Rs.
360,157 (Previous year Rs. 565,229) by the management and no actuarial
evaluation has been done during the year, as in the opinion of
management, differential will not be material.
17. The Company is in the process of revamping its paper making
machine in order to improve the quality of SS Maplitho Paper and copier
grade of paper has incurred certain cost such as power and manpower
amounting to Rs. 960,390(Previous year Rs. 1,745,324) and Rs.
1,539,420(Previous year Rs. 6,044,281)respectively, which are
capitalised.
18. In respect of Share Application Money received on October 11,2005
against Convertible warrents to be converted into 5,000,000 equity
shares of Rs. 10 each at a premium of Rs. 1.50 per share, the Board of
Directors had decided and consented to by the warrant holders, in the
Financial Year 2007-2008 not to go ahead with the issuing of shares to
the warrant holders, hence reversed in that year and application money
so received was credited to respective warrant holders account.
19. Related Parties Disclosure as per Accounting Standard 18 :
a) List of Related Parties:
Parties with whom the Company has entered into transactions during the
year Associates:
Nath Seeds Ltd. Nath Industrial Chemicals Ltd. Rama Pulp and Papers
Ltd. Paresh Farms Pvt. Ltd. Nath Bio-Genes (India) Ltd.
b) Key Managerial Personnel
Mr. Akash Kagliwal (Whole time Director)
During the year, following transactions were carried out with the
related parties in the ordinary course of business.
20. As per requirement of Accounting Standard 15 (Revised) Employees
Benefit, the Company has-provided for actuarial liability as per the
figures confirmed by the Life Insurance Corporation of India. However,
the report as required for disclosure of defined benefit scheme is
awaited.