Notes to Accounts of Resonance Specialties Ltd.

Mar 31, 2018

NOTE-1

Segment Reporting as per Ind AS 108

The company does have any reportable segment as per Ind AS 108 and thus Segment Reporting is not applicable NOTE-33

First-time adoption of Ind AS Transition to Ind AS

Theses financial statements, for the year ended 31st March 2018, are the first the company has prepared in accordance with Ind AS. For the periods upto and including the Year ended 31st March 2017, the company has prepared its financial statements in accordance with accounting standards notified under Section 133 of the Companies Act 2013, read with rule 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP). Accordingly the company has prepared financial statements which comply with Ind AS applicable for the periods ending 31st March 2018, together with the comparative period data as at for the year ended 31st March 2017, as discribed in the summary of significant accounting policies. In preparing these financial statements, the company''s opening balance sheet was prepared as at 1st April 2016, the company''s date of transition into Ind AS, This note explains the Principal adjustments made by the Company in restating its Indian GAAP financial statements, including the balance sheet as at 1st April 2016 and the financial statement for the year ended 31st March 2017.

A. Exceptions and Exemptions availed

Ind AS 101 allows first time adopters certain exemptions from the retrospective application of certain requirements under Ind AS. The company has applied the following exemptions:

1. Since there is no change in the functional currency, the company has elected to continue with the carrying value for all its investment property as recognized in its Indian GAAP financial as deemed cost at the transition date. Accordingly, the Company has not revalued the property, plant & equipment as on 1st April 2016

Ind AS mandatory exceptions: 1. Estimates

“An entity''s estimates in accordance with IndASs at the date of transition to IndAS shall be consistent with estimates made for the same date in accordance with previos GAAP. As there is no objective evidence that those estimates were in error. Ind AS estimates as at 1st April, 2016 are consistent with the estimates as at the same date in conformity with the previous GAAP.”

2. Classification and measurement of Financial assets

Ind AS 101 requires classification and measurement of Financial assets on the basis of facts and circumstances existing as on date of transition to Ind AS.

A. Reconciliations between previous GAAP and Ind AS

Ind AS 101 requires an entity to reconcile equity, total comprehensive income and cash flows for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.

Figures of previous year have been regrouped wherever necessary, to confirm to current year''s presentation.

Note 1- Classification and presentation of assets and liabilities

Under previous GAAP, the Company was not required to present its assets and liabilities bifurcating between financial assets / financial liabilities and non-financial assets / non-financial liabilities . Under Ind AS, the Company is required to present its assets and liabilities bifurcating between financial assets / financial liabilities and non-financial assets / non-financial liabilities . Accordingly, the Company has classified and presented its assets and liabilities.

Note 2- Reassesment of lease rent

Under Indian GAAP, lease security deposit (that are refundable in the nature on the completion of the lease term) are recorded at the transaction value. As per Ind AS 109, Financial Instruments, all financial assets and liabilities are required to be recognized at fair value. Since lease security are refundable in cash, they would generally meet the definition of financial asset under Ind AS 109. As the security deposits are interest free, the difference between the deposit amount and the fair value would then be recognized in the statement of profit and loss on straight line basis over the lease term.

NOTE-3

Employee benefit obligation Post Employment Benefit Plans

(a) Gratuity:

The Company provides for gratuity for employees as per the Payment of Gratuity Act,1972. Employees who are in continuous service for the period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/ termination is the employee last drawn salary per month computed proportionately for 15 days salary multiplied for the number of services.

Sensitivity Analysis Method

Sensitivity analysis is performed by varying a single parameter while keeping all other parameters unchanged. Hence, the result may vary if two or more variables are changed simultaneously. It fails to focus on the interrelationship between underlying parameters. The methods used does not indicate anything about the likelihood of change in any parameter and the extent of the change if any.

The methods and types of assumptions used in preparing the sensitivity analysis did not change compared to prior period.

(C) Risk Exposure

Though its defined benefit plans, the Company is expose to number of risks, the most significant of which are detailed below:

1. Acturial risk :

“It''s the risk that benefit will cost more than expected. This can arise due to following reasons:"

(a) Adverse salary growth experience : salary hikes that are higher than the assumed salary escalation will result in an increase in obligation at a rate that is higher than expected.

(b) Variability in mortality rates: If actual mortality rates are higher than assumed mortality rate assumption than the Gratuity benefits will be paid earlier than expected. Since there is no condition of vesting on the death benefit, the acceleration of cash flow will lead to an actuarial loss or gain depending on the relative values of the assumed salary growth and discount rate.

(c) Variability in withdrawal rates: If actual withdrawal rates are higher than assumed withdrawal rate assumption than the Gratuity benefits will be paid earlier than expected. The impact of this will depend on whether the benefits are vested as at the resignation date.

2. Investment Risk

For funded plans that rely on insurers for managing the assets, the value of assets certified by the insurer may not be the fair value of instruments backing the liability. In such cases, the present value of the assets is independent of the future discount rate. This can result in wide fluctuations in the net liability or the funded status if there are significant changes in the discount rate during the inter-valuation period.

3. Liquidity Risk:

Employees with high salaries and long durations or those higher in hierarchy, accumulate significant level of benefits. If some of such employees resign/retire from the Company there can be strain on the cash flows.

4. Market Risk:

Market risk is a collective term for risks that are related to the changes and fluctuations of the financial markets. One actuarial assumption that has a material effect is the discount rate. The discount rate reflects the time value of money. An increase in discount rate leads to decrease in Defined Benefit Obligation of the plan benefits & vice versa. This assumption depends on the yields on the corporate/government bonds and hence the valuation of liability is exposed to fluctuations in the yields as at the valuation date.

5. Legislative Risk:

Legislative risk is the risk of increase in the plan liabilities or reduction in the plan assets due to change in the legislation/ regulation. The government may amend the Payment of Gratuity Act thus requiring the companies to pay higher benefits to the employees. This will directly affect the present value of the Defined Benefit Obligation and the same will have to be recognized immediately in the year when any such amendment is effective.

NOTE-6 Fair values

Fair value measurement include both the significant financial instruments stated at amortized cost and at fair value in the statement of financial position. The carrying values of current financial instruments approximate their fair values due to the short-term maturity of these instruments and the disclosures of fair value are not made when the carrying amount of current financial instruments is a reasonable approximation of the fair value.

NOTE-7

Financial risk management objectives and policies

The risk management policies of the Company are established to identify and analyse the risks faced by the Company, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Company''s activities.

The Management has overall responsibility for the establishment and oversight of the Company''s risk management framework. In performing its operating, investing and financing activities, the Company is exposed to the Credit risk, Liquidity risk and Market risk.

Carrying amount of financial assets and liabilities:

The following table summarizes the carrying amount of financial assets and liabilities recorded at the end of the period by categories:

(Amount in Rs.)

Credit risk on financial assets

The company is engaged in business of manufacturing of Pyridine, Picoline, Cynopyridine and derivatives of the same. Bulks drugs and nutritional products are toll converted. Receivables are typically not secured by any form of credit support such as letters of credit, performance guarantees or escrow arrangements. Credit risk is the risk that counterparty will not meet its obligations under a financial instrument, leading to a financial loss. The Company is exposed to credit risk from its operating activities and from its financing activities, including deposits with banks and other financial instruments.

Financial assets that are potentially subject to concentrations of credit risk and failures by counter-parties to discharge their obligations in full or in a timely manner consist principally of cash, cash equivalents and other receivables. Credit risk on cash balances with Bank are limited because the counterparties are entities with acceptable credit ratings. The exposure to credit risk for loan to related parties is limited because the related parties are entities with acceptable credit rating.

Capital management

For the purpose of the Company''s capital management, capital includes issued equity capital, share premium and all other equity reserves attributable to the equity holders of the parent. The primary objective of the Company''s capital management is to maximize the shareholder value.

The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company''s policy is to keep optimum gearing ratio. The Company includes within net debt, interest bearing loans and borrowings, trade and other payables, less cash and cash equivalents, excluding discontinued operations.

In order to achieve this overall objective, the Company''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to immediately call loans and borrowings. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.

No changes were made in the objectives, policies or processes for managing capital during the years ended 31 March 2016 and 31 March 2015.

NOTE-8

Related Party Disclosures

In accordance with the requirements of IND AS 24, on related party disclosures, name of the related party, related party relationship, transactions and outstanding balances including commitments where control exits and with whom transactions have taken place during reported periods are:

b) Key Management Personnel of Company

Chairman & Managing Director Dr Atma Bandhu Gupta

Whole time Director Mr. Satish Chander Mathur

Independent Director Mrs. Archana Surendra Yadav

Independent Director Dr. Yaqoob Ali

Independent Director Mr. Laxmi Ratan Daga

Non-Executive Director Mr. Bishwanath Prasad Agrawal

Chief Financial Officer Mrs. Shital Churi

Company Secretary Mrs. Minal Bhosale

NOTE-9 Capital Commitments

a) Capital expenditure contracted at the end of the reporting period but not recognized as liability is as follows : There were no capital liability yet to be recognized

b) The Company had cancellable operating leases which expired as on 31 st March''18.

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Mar 31, 2016

c) Note on Nature of Security on secured loan

(The above borrowing from Bank is secured by hypothecation of present and future stock of raw material, stock in process and Finished goods and book debts of the company, and further secured by first charge by way of equitable mortgage of land and building, plant and machineries and all immovable properties of the company situated at T - 140, MIDC Industrial Estate, Tarapur, Dist-Thane and further guaranteed by Managing Director of the company and is repayable on demand).

d) Working capital borrowing in form of cash credit account carry interest rate of 12.65% per annum and export packing credit at 10.90%.

Note -1: Contingent Liabilities:

a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. NIL-net of advance (Previous year Rs. NIL).

b) Bank Guarantees issued and outstanding on Balance Sheet date is Rs.41,00,000 (Previous year Rs. 42,50,000)

c) Letters of credit outstanding Rs 1,42,79,919 (Previous year: Rs 3,48,83,514)

d) Sale tax demand against which the company filed the appeals for the years 2005-06 to 2009-10 of Rs. 20,28,11,451 (Previous Year Rs: 20,28,11,451) for which permanent stay was granted on part payment of Rs. 80,35,000

e) Demand from service tax authority contested in appeal Rs. 27,11,069 (Previous year Rs: 27,11,069).

f) Demand from Income tax authority contested in appeal Rs. 16,18,770 (Previous year NIL).

g) Claim against the company by a customer but not admitted, pending in High Court Rs. 33,63,214 (Previous year Rs: 33,63,214).

Note-2: Disclosure pursuant to the Accounting standard -15 : Employees benefit.

Company adopted the Accounting Standard (AS-15) (Revised 2005) "Employee Benefits" effective from April 01, 2007.

The Company has classified the various benefits provided to employees as under:

I Defined Contribution Plans

The Company has recognized the amounts of Provident Fund of Rs. 8,78,761 (P.Y. 7,58,725) in Profit and Loss Account for the year ended 31st March, 2016:

II Defined Benefit Plans

Contribution to Gratuity Fund (Non Funded Scheme)

In accordance with the Accounting Standard (AS 15) (Revised 2005) actuarial valuation was performed in respect of the aforesaid defined benefit plans based on the following assumptions:

Note-3. Disclosure pursuant to the Accounting standard -17 : Segment Reporting

The Company has only one segment i.e. ''Chemical Manufacturing''. Therefore, as per Accounting Standard -17 (AS-17) the disclosure under ''Segment Reporting'' is not considered necessary.

Note-4: Disclosure pursuant to the Accounting standard -18 : Related party Transaction

a) Particulars of Related Parties

~NAME OF RELATED PARTY NATURE OF RELATIONSHIP

i) Vista organics Pvt. Ltd. Interest of Director''s Relatives

ii) Avignon Exim Pvt. Ltd. Interest of Director''s Relatives

iii) Vista Finance & Leasing Pvt Ltd. Interest of Director''s Relatives

iv) Avignon Chemicals P Ltd. Interest of Director''s Relatives

v) Ushma Investments Pvt Ltd. Interest of Director''s Relatives

vi) Ushma Technologies Pvt Ltd Interest of Director''s Relatives

b) Key Management Personnel

NAME OF RELATED PARTY NATURE OF RELATIONSHIP

i) Dr Atma Gupta Managing director

ii) @Mr. Kamlesh Yadav Wholetime Director

iii) ''Mr. Satish Mathur Wholetime Director

iv) Mr. Dwarika Agrarwal Chief Financial officer

@Resigned w.e.f. 14^th November, 2015 ''Appointed w.e.f. 8^th February, 2016

*Purchases & Sales figures mentioned above include amount of High Seas Purchases & High seas Sales respectively and exclusive of duties & Taxes.

** Conversion charges are net off material supplied for Conversion.

# For part of the year.

Remarks:

a) Related parties are as identified by the management and relied upon by the auditors.

b) Reimbursement of expenses in normal course of business are not considered hereinabove.

Note -5 Reporting on other disclosures

a) The Company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprise and therefore, the claims for suppliers and other related data as per the requirement of Micro , Small and Medium Enterprises Development Act, 2006 could not be ascertained.

b) In the opinion of Board, current assets, loan and advances are stated at a value at least equal to the expected value on realization in the ordinary course of business.

c) During the year the company had carried out development of certain process technology for efficient commercial production in its approved R & D facilities at Tarapur and incurred an amount of Rs.55,74,259 /- (P.Y. 60,08,447/-) as Research & Development expenditure which have been accounted as follows :

d) Provision for Income Tax has been made considering the benefits available u/s 35 of the Income tax act.

e) The unclaimed dividend of Rs. 814,866 (PY Rs. 398,386.50) is not due to be transferred in investor education and protection fund and adequate funds are available in unclaimed dividend bank account.

f) The Consumption of the raw material are reported after deducting the cost of material received from third parties for conversion but used by the company for captive use amounting to Rs.61,23,150 (P Y Rs. 72,40,495). The conversion charges received, therefore, are also adjusted by the said amount.

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Mar 31, 2014

NOTE-1

RESERVE & SURPLUS

d) The Company had revalued its factory land & building and plant & machineries situated at T-140 MIDC, Tarapur on 31st March, 2005 based on the report of the registered valuer. Accordingly, the appreciation/ diminution in the value of fixed assets has been added to/deducted from the value of the respective assets. The net appreciation amounting to Rs. 8,57,77,652 had been credited to Revaluation reserve account, which is being amortized year after year at the prescribed rate of depreciation and net amount is shown in note 4(b) above

NOTE-2 SHORT TERM BORROWING

c) Note on Nature of Security on secured loan

(The above borrowing from Bank is secured by hypothecation of present and future stock of raw material,stock in process and Finished goods and book debts of the company, and further secured by frst charge by way of equitable mortgage of land and building, plant and machineries and all immovable properties of the company situated at T 140 MIDC Tarapur, Dist-Thane and further guaranteed by Managing Director of the company and is repayable on demand)

d) Working capital borrowing carry interest rate of 13.25% per annum

Note -3: Contingent Liabilities:

a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. NIL-net of advance (Previous year Rs. NIL).

b) Bank Guarantees issued and outstanding on Balance Sheet date: Rs.53,50,000 (Previous year Rs. 6,00,000)

c) Letters of credit outstanding Rs.3,39,72,533 Previous year: Rs.1,39,47,463. Note-31: Disclosure pursuant to the Accounting standard -15 : Employees benefit.

Company adopted the Accounting Standard (AS–15) (Revised 2005) "Employee benefits" efective from April 01, 2007. The Company has classifed the various benefits provided to employees as under:

I Defined Contribution Plans

The Company has recognized the amounts of Provident Fund of Rs.9,34,033 (P.Y. 8,75,428) in profit and Loss Account for the year ended 31st March, 2014:.

II Defined benefit Plans

Contribution to Gratuity Fund (Non Funded Scheme)

In accordance with the Accounting Standard (AS 15) (Revised 2005) actuarial valuation was performed in respect of the aforesaid Defined benefit plans based on the following assumptions:

Note-4. Disclosure pursuant to the Accounting standard -17 : Segment Reporting

The Company has only one segment i.e. ''Chemical Manufacturing''. Therefore, as per Accounting Standard –17 (AS-17) the disclosure under ''Segment Reporting'' is not considered necessary.

Note -5 Reporting on other disclosures

a) The Company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprise and therefore, the claims for suppliers and other related data as per the requirement of Micro , Small and Medium Enterprises Development Act, 2006 could not be ascertained.

b) In the opinion of Board, current assets, loan and advances are stated at a value at least equal to the expected value on realisation in the ordinary course of business.

d) Provision for Income Tax has been made considering the benefits available u/s 35 of the Income tax act..

e) The Consumption of the raw material are reported after deducting the cost of material received from third parties for conversion but used by the company for captive use amounting to Rs.1,60,63,577 (P Y Rs. 1,57,92,090.) The conversion charges received, therefore, are also adjusted by the said amount.

ii) Since no commission is payable to Managing Director computation of net profit under section 198 read with section 349 of the Companies Act, 1956 has not been disclosed

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Mar 31, 2013

NOTE-1

GENERAL INFORMATION

M/s Resonance Specialties Limited (company) is incorporated under the companies Act 1956, and is listed with Bombay stock exchange, the main activity of company is manufacturing of Pyridine, Picoline, Cynopyridine and derivatives of the same. Bulks drugs and nutritional products are toll converted. In view of multi products manufacturing and fractional distillation in batches, overall average production cycle is around 2 to 4 months from the procurement till the disposal.

NOTE-2

BASIS OF PREPARATION

The financial statements of the company have been prepared in accordance with generally accepted accounting principals in India (Indian GAAP). The Company has prepared these financial statement to comply in all material respect with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006.(as amended) and the relevant provisions ofthe Companies Act, 1956. The financial statements have been prepared on an accrual basis and under historical cost convention.

NOTE -3: CONTINGENT LIABILITIES:

a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. NIL-netof advance (Previous year Rs. NIL).

b) Bank Guarantees issued and outstanding on Balance Sheet date: Rs.6,00,000 (Previous year Rs. 5,00,000)

c) Letters of credit outstanding Rs 1,39,47,463 Previous year: Rs 1,09,07,456).

NOTE-4: DISCLOSURE PURSUANT TO THE ACCOUNTING STANDARD -15 : EMPLOYEES BENEFIT.

Company adopted the Accounting Standard (AS-15) (Revised 2005) "Employee Benefits" effective from April 01, 2007.

The Company has classified the various benefits provided to employees as under:

I Defined Contribution Plans

The Company has recognized the amounts of Provident Fund of Rs. 875428 (P.Y. 596771) in Profit and Loss Account for the year ended 31st March, 2013:

II Defined Benefit Plans

Contribution to Gratuity Fund (Non Funded Scheme)

In accordance with the Accounting Standard (AS 15) (Revised 2005) actuarial valuation was performed in respect of the aforesaid defined benefit plans based on the following assumptions:

NOTE-5. DISCLOSURE PURSUANT TO THE ACCOUNTING STANDARD -17 : SEGMENT REPORTING

The Company has only one segment i.e. ‘Chemical Manufacturing''. Therefore, as per Accounting Standard -17 (AS-17) the disclosure under ‘Segment Reporting'' is not considered necessary.

NOTE -6 REPORTING ON OTHER DISCLOSURES

a) The Company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprise and therefore, the claims for suppliers and other related data as per the requirement of Micro, Small and Medium Enterprises Development Act, 2006 could not be ascertained.

b) In the opinion of Board, current assets, loan and advances are stated at a value at least equal to the expected value on realisation in the ordinary course of business.

c) During the year the company had carried out development of certain process technology for efficient commercial production in its approved R&D facilities at Tarapur and incurred an amount of Rs. 28,66,587/- (P.Y. 57,37,609/-) as Research & Development expenditure which have been accounted as follows :

The Company developed Certain process technologies over a period of time, and on successful completion, the same we capitalised as ‘intangible assets'' for an amount of Rs. 39,83,475/-.

d) Provision for Income Tax has been made considering the benefits available u/s 35 of the Income tax act.

e) The Consumption of the raw material are reported after deducting the cost of material received from third parties for conversion but used by the company for captive use amounting to Rs. 1,57,92,090 (P Y Rs. 1,00,24,201.) The conversion charges received, therefore, are also adjusted by the said amount.

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Mar 31, 2012

GENERAL INFORMATION

M/s Resonance Specialties Limited (company) is incorporated under the companies Act 1956, and is listed with Bombay stock exchange, the main activity of company is manufacturing of Pyridine, Picoline, Cynopyridine and derivatives of the same. Bulks drugs and nutritional products are toll converted. In view of multi products manufacturing and fractional distillation in batches, overall average production cycle is around 2 to 4 months from the procurement till the disposal.

BASIS OF PREPARATION

The financial statements of the company have been prepared in accordance with generally accepted accounting principals in India (Indian GAAP). The Company has prepared these financial statement to comply in all material respect with the accounting standards notified under the Companies (Accounting Standards) Rules, 2006.(as amended) and the relevant provisions of the Companies Act, 1956. The financial statements have been prepared on an accrual basis and under historical cost convention.

a) Terms/ rights attached to equity shares

1. The Company has only one class of shares referred to as equity shares having a par valueof Rs 10/-.Each holder of equity shares is entitled to one vote per share.

2. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining assets of the company, after distribution of all preferential amounts. However, no such preferential amounts exist currently. The distribution will be in proportion to the number of equity shares held by the shareholders

d)The Company had revalued its factory land & building and plant & machineries situated at T-140 MIDC, Tarapur on 31st March, 2005 based on the report of the registered valuer. Accordingly, the appreciation/ diminution in the value of fixed assets has been added to/deducted from the value of the respective assets. The net appreciation amounting to Rs 85,777,652 had been credited to Revaluation reserve account, which is being amortized year after year at the prescribed rate of depreciation and net amount is shown in note 4(b) above

c) Note on Nature of Security on secured loan

(The above borrowing from Bank is secured by hypothecation of present and future stock of raw material, stock in process and Finished goods and book debts of the company, and further secured by first charge by way of equitable mortgage of land and building, plant and machineries and all immovable properties of the company situated at T 140 MIDC Tarapur, Dist-Thane and further guaranteed by Managing Director of the company and is repayable on demand)

d) Working capital borrowing carry interest rate of 16% per annum

There was a fire on 14th February, 2011 at the factory premises which resulted in destruction of some of the plant & Machineries including the materials. The company had lodged a claim for the loss of the same in previous year. The loss of material of Rs 18,20,427 and Fixed assets of Rs 28,31,857 are net of insurance claim of Rs 24,81,825/-i.e Rs 12,95,272 for material and Rs 11,86,553/-for assets.

NOTE-1: CONTINGENT LIABILITIES:

a) Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. NIL -net of advance (Previous year Rs 3,05,664).

b) Bank Guarantees issued and outstanding on Balance Sheet date: Rs 5.00,000 (Previous year Rs 5,00,000)

c) Letters of credit outstanding Rs 1,09,07,456 (Previous year: Rs 3,17,16,026).

NOTE-2: DISCLOSURE PURSUANT TO THE ACCOUNTING STANDARD -15 : EMPLOYEES BENEFIT.

Company adopted the Accounting Standard (AS-15) (Revised 2005) "Employee Benefits" effective from April 01, 2007.

The Company has classified the various benefits provided to employees as under:

I Defined Contribution Plans

The Company has recognized the amounts of Provident Fund of Rs 5,96,771 (P.Y. 3,32578) in Profit and Loss Account for the year ended 31st March, 2012:

NOTE-3. DISCLOSURE PURSUANT TO THE ACCOUNTING STANDARD -17 : SEGMENT REPORTING

The Company has only one segment i.e. 'Chemical Manufacturing'. Therefore, as per Accounting Standard -17 (AS- 17) the disclosure under 'Segment Reporting' is not considered necessary.

* Purchases & Sales figures mentioned above include amount of High Seas Purchases & High seas Sales respectively and inclusive of duties & Taxes.

** Conversion charges are net off material supplied for Conversion..

Remarks:a) Related parties are as identified by the management and relied upon by the auditors

b) Reimbursement of expenses in normal course of business are not considered hereinabove.

NOTE -4 REPORTING ON OTHER DISCLOSURES

a) The Company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprise and therefore, the claims for suppliers and other related data as per the requirement of Micro , Small and Medium Enterprises Development Act, 2006 could not be ascertained.

b) In the opinion of Board, current assets, loan and advances are stated at a value at least equal to the expected value on realisation in the ordinary course of business.

Pending Completion of development of some of those process technologies, the company continued to carry over the total amount of ' 39,83,475 (P. Y Rs 39,83,475/-) in R&D Work in progress under the head 'Capital Work in Process' in view of the fact that the intangible assets so developed will generate future economic benefit by way of improvement in yield and efficiency of those products. The following are the movements in the R& D Capital Work in Progress:

d) No Provision for Income Tax is made in view of loss.

e) The Consumption of the raw material are reported after deducting the cost of material received from third parties for conversion but used by the company for captive use amounting to Rs 1,00,24,201 (PY Rs 202,98,608.) The conversion charges received, therefore, are also adjusted by the said amount.

f) Value of Import and indigenous Raw Material, Stores and Spare consumed.

ii) Since no commission is payable to Managing Director computation of net profit under section 198 read with section 349 of the Companies Act, 1956 has not been disclosed j) Previous year's figures

Till the year 2011, the Company was using pre revised schedule VI to the Companies Act, 1956 for the preparation of its financial statement. During the year ended on 31st March 2012, the revised schedule VI notified under the Companies Act, 1956 has become applicable to the Company. The Company has reclassified previous year's figures to conform to this year's classification. The adoption of the revised Schedule VI does not impact recognition and measurement principles followed by the Company for the preparation of the financial statements. However, it significantly impacts presentation and disclosures made in the financial statements.

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Mar 31, 2010

1) Contingent Liabilities:

a) Estimated amount of contracts remaining to be executed on capital account and not provided for is Rs 2,902,752 net of advance (Previous year Rs 3,435,529).

b) Bank Guarantees issued and outstanding on Balance Sheet date is Rs 22,18,710 (Previous year Rs 2,268,710)

c) Letters of credit outstanding Rs 35,72,1460 (Previous year: Rs 287,15,788).

d) Claims against the Company, not acknowledged as debts ? Nil. (Previous year Rs 7,651,603).

2) The Company has no information as to whether any of its suppliers constitute Micro, Small or Medium Enterprise and therefore, the claims for suppliers and other related data as per the requirement of Micro , Small and Medium Enterprises Development Act, 2006 could not be ascertained.

3) In the opinion of Board, current assets, loan and advances are stated at a value at least equal to the expected value on realisation in the ordinary course of business.

4) a) The Company had revalued its factory land & building and plant & machineries situated at T-140 MIDC, Tarapur on 31st March, 2005 based on the report of the registered valuer. Accordingly, the appreciation/ diminution in the value of fixed assets has been added to/ deducted from the value of the respective assets. The net appreciation amounting to Rs 85,777,652 had been credited to Revaluation reserve account, which is being amortized year after year at the prescribed rate of depreciation and net amount is shown in schedule 2 of the annexed accounts.

b) During the year 2005-06, the company has improved the reaction parameters and upgraded the distillation of the products. Based on the report of the registered valuer, such intricate/ sophisticate Technology was valued at Rs 25,000,000 which had been added to fixed assets under the head Intangibles and credited to the Revaluation reserve, which was being amortized year after year at the prescribed rate of depreci -ation. In order to Comply with AS-26 the same has been reversed and Un-amortized value of Rs 1,75,00,000 was debited to revaluation reserve

5) During the year the company had carried out development of certain process technology for efficient commercial production in its approved R&D facilities at Tarapur and incurred an amount of Rs 13,194,182 (P. Y. Rs 10,497,158) as Research & Development expenditure which have been accounted as follows :

6) (a) Provision for Income Tax has been made in the annexed accounts after considering the benefits u/s 35(2AB) of the Income Tax Act, 1961.

(b) As regards R& D expenses covered u/s 35(2AB) of the Income Tax Act, the company is complying with the statutory requirement by regularly submitting the periodical statement to the prescribed authority i.e. Department of Scientific and Industrial Research (DSIR).

7) Related Party Disclosures:

The names of the related parties, key management personnel, the nature of their transactions and their values are given herein below: a) Particulars of Related Parties

NAME OF RELATED PARTY NATURE OF RELATIONSHIP

i) Vista organics Private Ltd. Associate Company

ii) Avignon Exim Private Ltd. Associate Company

iii) Vista Finance & Leasing Private Ltd. Associate Company

iv) Avignon Chemicals Private Ltd. Associate Company

v) Ushma Investments Private Ltd. Associate Company

vi) Ushma Technologies Private Ltd Associate Company

b) Key Management Personnel

NAME OF RELATED PARTY NATURE OF RELATIONSHIP

Dr Atma Gupta Managing director

8) Segment Reporting

The Company has only one segment i.e. Chemical Manufacturing. Therefore, as per Accounting Standard -17 (AS-17) the disclosure under Segment Reporting is not considered necessary.