Notes to Accounts of Sangam (India) Ltd.
Mar 31, 2023
Provision and contingent liabilities
The Company sets up a provision when there is a
present legal or constructive obligation as a result of a
past event and it will probably requires an outflow of
resources to settle the obligation and a reliable estimate
can be made. If the effect of the time value of money
is material, provisions are determined by discounting
the expected future cash flows at a pre-tax rate that
reflects current market assessments of the time value
of money and the risks specific to the liability. When
discounting is used, the increase in the provision due to
the passage of time is recognized as a finance cost.
The amount recognized as a provision is the best
estimate of the consideration required to settle the
present obligation at reporting date, taking into account
the risks and uncertainties surrounding the obligation.
A disclosure for a contingent liability is made where
there is a possible obligation that arises from past
events and the existence of which will be confirmed
only by the occurrence or non-occurrence of one or
more uncertain future events not within the control
of the Company or a present obligation that arises
from past events where it is either not probable that
an outflow of resources will be required to settle the
obligation or where reliable estimate of the obligation
cannot be made. Contingent liabilities are disclosed on
the basis of judgment of the management/independent
experts. These are reviewed at each balance sheet date
and are adjusted to reflect the current management
estimate.
In case of Onerous Contracts the Company is
recognizing impairment loss is any, occurred on assets
used in fulfilling the contract.
Contingent Assets are not recognized in the financial
statements. However, these are disclosed in the
Director''s report.
(i) Revenue from operations
Revenue from contracts with customers is
recognized when control of the goods or services
are transferred to the customer at an amount that
reflects the consideration the Company is entitled
in exchange for those goods or services.
Revenue towards satisfaction of a performance
obligation is measured at the amount of
transaction price (Net of variable consideration)
allocated to that performance obligation. The
transaction price of goods sold and services
rendered is net of variable consideration on
account of.
A. Sale of goods
Generally, control is transferred upon shipment
of goods to the customer or when the goods
is made available to the customer, provided
transfer of title to the customer occurs and
the Company has not retained any significant
risks of ownership or future obligations with
respect to the goods shipped.
Consideration is generally due upon
satisfaction of performance obligations and
a receivable is recognized when it becomes
unconditional.
In case of discounts, rebates, credits, price
incentives or similar terms, consideration are
determined based on its most likely amount,
which is assessed at each reporting period.
B. Rendering of services
Revenue from rendering of services is
recognized over time by measuring the
progress towards complete satisfaction of
performance obligations at the reporting
period.
Revenue is measured at the amount of
consideration which the Company expects
to be entitled to in exchange for transferring
distinct goods or services to a customer
as specified in the contract, excluding
amounts collected on behalf of third parties
(for example taxes and duties collected on
behalf of the government). Consideration
is generally due upon satisfaction of
performance obligations and a receivable is
recognized when it becomes unconditional.
In case of discounts, rebates, credits, price
incentives or similar terms, consideration are
determined based on its most likely amount,
which is assessed at each reporting period.
C. Other operational revenue
Other operational revenue represents income
earned from the activities incidental to the
business and is recognized when the right to
receive the income is established as per the
terms of the contract.
A. Interest income is accrued on a time basis
by reference to the principal outstanding and
the effective interest rate.
B. Dividend income is accounted in the period
in which the right to receive the same is
established.
C. Other items of income are accounted as and
when the right to receive such income arises
and it is probable that the economic benefits
will flow to the Company and the amount of
income can be measured reliably
An item of income or expense which by its size, type
or incidence requires disclosure in order to improve
an understanding of the performance of the Company
is treated as an exceptional item and the same is
disclosed in the notes to accounts.
S. Government grants
Grants from government are recognized at their fair
value where there is reasonable assurance that the
grant will be received and the Company will comply
with all attached conditions.
Government grants relating to income are deferred and
recognized in the statement of profit and loss account
over the period necessary to match them with the costs
that they are intended to compensate and presented
within other income.
Government grants relating to the purchase of property,
plant and equipment are included in non-current
liabilities as deferred income and are credited to profit
or loss on a straight line basis over the expected lives of
the related assets and presented within other income.
T. Segment reporting
An operating segment is a component of the Company
that engages in business activities from which it may
earn revenues and incur expenses, including revenues
and expenses that relate to transactions with any of the
Companyâs other components, and for which discrete
financial information is available. Operating segments
are reported in a manner consistent with the internal
reporting provided to the chief operating decision
maker (''CODMâ).
The Companyâs Board has identified the CODM who is
responsible for financial decision making and assessing
performance. The Company has a single operating
segment as the operating results of the Company are
reviewed on an overall basis by the CODM.
The Company, as a lessee, recognizes a right-of-use
asset and a lease liability for its leasing arrangements,
if the contract conveys the right to control the use of
an identified asset. The determination of whether
an agreement is, or contains, a lease is based on the
substance of the agreement at the date of inception.
The contract conveys the right to control the use of an
identified asset, if it involves the use of an identified
asset and the Company has substantially all of the
economic benefits from use of the asset and has right
to direct the use of the identified asset.
Initial measurement
Lease Liability: At the commencement date, a Company
measure the lease liability at the present value of the
lease payments that are not paid at that date. The
lease payments shall be discounted using incremental
borrowing rate. Right-of-use assets: initially recognized
at cost, which comprises the initial amount of the lease
liability adjusted for any lease payments made at or
prior to the commencement date of the lease plus any
initial direct costs less any lease incentives.
Lease Liability: Company measure the lease liability by
(a) increasing the carrying amount to reflect interest on
the lease liability; (b) reducing the carrying amount to
reflect the lease payments made; and (c) remeasuring
the carrying amount to reflect any reassessment or
lease modifications. Right-of-use assets: subsequently
measured at cost less accumulated depreciation and
impairment losses. Right-of-use assets are depreciated
from the commencement date on a straight line basis
over the shorter of the lease term and useful life of the
under lying asset.
Right of use assets are evaluated for recoverability
whenever events or changes in circumstances indicate
that their carrying amounts may not be recoverable.
For the purpose of impairment testing, the recoverable
amount (i.e. the higher of the fair value less cost to sell
and the value in-use) is determined on an individual
asset basis unless the asset does not generate cash
flows that are largely independent of those from
other assets. In such cases, the recoverable amount
is determined for the Cash Generating Unit (CGU) to
which the asset belongs.
Short term Lease or Low Value Lease
Short term lease is that, at the commencement date,
has a lease term of 12 months or less. A lease that
contains a purchase option is not a short-term lease.
Low value lease is for which the underlying asset is of
low value. If the Company elected to apply short term
lease/Low Value Lease, the lessee shall recognize the
lease payments associated with those leases as an
expense on either a straight-line basis over the lease
term or another systematic basis. The lessee shall
apply another systematic basis if that basis is more
representative of the pattern of the lesseeâs benefit.
V. Share based payment / arrangements
The stock options granted to employees in terms of
the Companyâs Stock Options Schemes, are measured
at the fair value of the options at the grant date. The
fair value of the options is treated as discount and
accounted as employee compensation cost over the
vesting period on a straight-line basis. The amount
recognized as expense in each year is arrived at based
on the number of grants expected to vest. If a grant
lapses after the vesting period, the cumulative discount
recognized as expense in respect of such grant is
transferred to the general reserve within equity. The
fair value of the stock options granted to employees
of the Company by the Companyâs subsidiaries is
accounted as employee compensation cost over
the vesting period and where such fair value is not
recovered by the subsidiaries, the same is treated as
dividend declared by them. The share-based payment
equivalent to the fair value as on the date of grant of
employee stock options granted to key managerial
personnel is disclosed as a related party transaction
in the year of grant. The dilutive effect of outstanding
options is reflected as additional share dilution in the
computation of diluted earnings per share.
The stock option scheme for employees is yet to be
implemented by the Company.
Basic earnings per equity share is computed by dividing
the net profit or loss attributable to equity shareholders
of the Company by the weighted average number of
equity shares outstanding during the financial year.
Diluted earnings per equity share is computed by
dividing the net profit or loss attributable to equity
shareholders of the Company by the weighted average
number of equity shares considered for deriving basic
earnings per equity share and also the weighted
average number of equity shares that could have been
issued upon conversion of all dilutive potential equity
shares.
X. Standards issued but not effective
The Ministry of Corporate Affairs (MCA) has
notified Companies (Indian Accounting Standards)
Amendment Rules, 2023. This notification has resulted
into amendments in the following existing accounting
standards which are applicable to company from April
01,2023.
I. Ind AS 107 - Financial Instrument Disclosures.
II. Ind AS 109 - Financial Instrument
III. Ind AS 115 - Revenue from contracts with
customers
IV. Ind AS 1 - Presentation of Financial Statements
V. Ind AS 34 - Interim Financial Reporting
Application of above standards are not expected to
have any significant impact on the Companyâs financial
statements.
Mar 31, 2018
1. GENERAL INFORMATION:
Sangam (India) Limited (âthe Companyâ), is a public limited company domiciled in India and was incorporated on 29.12.1984 under the provisions of the Companies Act, 1956 (now replaced by Companies Act 2013) as applicable in India. Its shares are listed on National Stock Exchange of India (NSE) and Bombay Stock Exchange (BSE) of India.
The registered office of the Company is located at Atun, Chittorgarh Road, Bhilwara - 311 001, Rajasthan, India.
The Company is principally engaged in the business of manufacturing and selling of Synthetic Blended, Cotton & Texturised yarn, Fabrics, Denim Fabrics and ready made seamless garment.
The Company has manufacturing facilities at Atun, Biliya kalan & Sareri in district Bhilwara and Soniyana in district Chittorgarh in Rajasthan and caters both the domestic and export markets.
The Company is having 5MW Wind Power Generation facility at Jaisalmer, Rajasthan.
1.1 BASIS OF PREPARATION:
A. Statement of compliance
These financial statements have been prepared in accordance with the Indian Accounting Standards (hereinafter referred to as the âInd ASâ) as notified by Ministry of Corporate Affairs pursuant to section 133 of the Companies Act, 2013 read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.
These financial statements for the year ended 31st March, 2018 are the first financial statement under Ind AS. For all periods upto and including the year ended 31st March, 2017, the Company prepared its financial statements in accordance with the accounting standards notified under the section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (hereinafter referred to as âPrevious GAAPâ) used for its statutory reporting requirement in India immediately before adopting Ind AS. The financial statements for the year ended 31st March, 2017 and the opening Balance Sheet as at 1st April, 2016 have been restated in accordance with Ind AS for comparative information. The Company followed the provisions of Ind-AS 101 in preparing its opening Ind AS Balance Sheet as of the date of transition i.e 1st April, 2016. Reconciliations and explanations of the effect of the transition from previous GAAP to Ind AS on the Companyâs Balance Sheet, Statement of Profit and Loss including Comprehensive income and Statement of Cash Flows are provided in the Notes.
These financial statements were approved for issue in accordance with the resolution of the Board of Directors as per its meeting held on 30th May, 2018.
B. Functional and presentation currency
These financial statements are presented in Indian Rupees (INR), which is the Companyâs functional currency. All financial information presented in INR has been rounded off to the nearest Lakhs, except as stated otherwise.
C. Basis of measurement
The financial statements have been prepared under the historical cost convention on accrual basis. The following items are measured on each reporting date as under:
D. Use of estimates and judgements
In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Management believes that the estimates used in the preparation of the financial statements are prudent and reasonable. Actual result may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized prospectively.
Judgments
Information about judgments made in applying accounting policies that have the most significant effects on the amounts recognized in the financial statements have been given below:
- Classification of leases into finance or operating lease
- Leases: whether an arrangement contains a lease.
- Classification of financial assets: assessment of business model within which the assets are held and assessment of whether the contractual terms of the financial asset are solely payments of principal and interest on the principal amount outstanding.
Assumptions and estimation uncertainties
Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in the subsequent period financial statements is included below:
- Estimation of current and deferred tax expense and asset/ liability.
- Estimated useful life of property, plant and equipment.
- Estimation of defined benefit obligation.
- Measurement and likelihood of occurrence of provisions and contingencies.
- Impairment of trade receivables.
E. Measurement of fair values
Companyâs accounting policies and disclosures require the measurement of fair values, for both financial and non- financial assets and liabilities.
The Company has an established control framework with respect to the measurement of fair values. This includes a team that has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values, and reports directly to the controller.
The team regularly reviews significant unobservable inputs and valuation adjustments. If third party information, such as broker quotes or pricing services, is used to measure fair values, then the team assesses the evidence obtained from the third parties to support the conclusion that these valuations meet the requirements of Ind AS, including the level in the fair value hierarchy in which the valuations should be classified.
Fair values are categorized in a fair value hierarchy based on the inputs used in the valuation techniques as under:
- Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.
- Level 2: inputs other than quoted price included in Level 1 that are observable for the assets or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
- Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
When measuring the fair value of an asset or a liability, the Company uses observable market data as far as possible. If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorized in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.
The Company recognizes transfer between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.
1.1 Sangam Lifestyle Ventures Limited became a wholly owned subsidiary company w.e.f. 14th June, 2016 on its incorporation.
2.1 As per the management, The Investment in Keti Sangam is long term investment and has potential to give huge appreciation in future. The vehicular traffic is increasing day by day and the concession period is about 24 years. Further there is provision of hike in toll charges of 15% in every 3 years. Considering the potential of the project the banks have securitised the project from Rs. 225 Crores to Rs. 313 Crores. Hence this investment is a long term valuable asset of the Company, Accordingly diminution is not provided.
3.1 for all the transaction with related party Refer Note No. 40.
4.1 For basis of valuation of inventories Refer Note No. 2 J
4.2 Inventories as above are hypothecated to secured short term borrowings (Refer Note No. 20.1)
a. Terms and Rights attached to Equity Shares
Each holder of Equity Shares is entitled to one vote per share. In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportion to the number of Equity Shares held by the shareholders. There is no restriction on distribution of dividend. However, same is subject to the approval of the shareholders in the Annual General Meeting.
5.1 Capital Reserve
Capital Reserve created on account of merger/ amalgamation. The balance will be utilized for issue of fully paid bonus shares and as per provisions of the Companies Act, 2013.
5.2 Securities Premium Reserve
Balance of Security premium reserve consist of premium on issue of share over its face value. The balance will be utilized for issue of fully paid bonus shares, buy-back of its own share as per provisions of the Companies Act, 2013.
5.3 Preference Share Capital Redemption Reserve
Preference Share Capital Redemption Reserve represents the statutory reserves created when the capital is redeemed and the same will be utilized for issue of bonus share as per provisions of the Companies Act, 2013.
5.4 General Reserve
The Company appropriates a portion to General Reserves out of the profits voluntarily to meet future contingencies. The said reserves is available for payment of dividend to the shareholders as per the provisions of the Companies Act, 2013.
5.5 Remeasurement of defined benefit plans
Remeasurements of defined benefit plans represents the following as per Ind AS 19, Employee Benefits:
(a) Actuarial Gains and Losses
(b) The return on plan assets, excluding amounts included in net interest on the net defined benefit liability (asset); and
(c) Any change in the effect of the asset ceiling, excluding amounts included in net interest on the net defined benefit liability (asset)
6.1 All Term Loans from banks (including current maturities) except vehicle loan are secured by a joint equitable mortgage by deposit of title deeds in respect of all immovable properties and first hypothecation of the entire moveable properties of the company , both present and future (save and except book debts) subject to prior charges created/to be created in favour of bankers for securing working capital borrowing, ranking pari-passu with the charges created / to be created in favour of other participating bankers. The above Term Loans are further secured by personal guarantee of two directors of the company.
6.2 Vehicle Loans (including current maturities) are secured by hypothecation of respective vehicle(s)
6.3 Foreign Currency Loans (Buyers Credit) for the years ended 31.03.18 â NIL, 31.03.17 â NIL and 01.04.16 Rs. 1,663 Lakhs .The ultimate payment of the above loan of Rs. 1,663 Lakhs was made from the term loans during the F.Y. 2016-17
6.4 There is no default in repayment or interest of any loans on due dates.
7.1 Borrowings from Banks for working capital are secured by hypothecation of inventories and charge on book debts both present and future and second charge on all the immoveable and moveable Property, Plant & Equipments of the Company. The above borrowing are further secured by personal guarantee of two directors of the Company. There is no default in repayment or interest of any loans on due dates.
7.2 Rupee Loans carry floating interest rate from 8.10% to 10.65% per annum, computed monthly.
7.3 Foreign Currency Loans carry floating interest rate LIBOR 1.10 to 2% per annum, computed monthly.
8.1 Dues to Micro, Small & Medium Enterprises:-
The Company has not received any intimation from its suppliers being registered under Micro, Small and Medium Enterprises Development Act, 2006 (MSME). Since the relevant information is not readily available, necessary disclosure required under MSME Act, 2006 can not be made. However, the company generally makes payment to its suppliers within agreed credit period and thus the management is confident that the liability of interest under this Act, if any, would not be material.
9. The Company had executed a toll user fee collection contract with NHAI for Usaka Toll Plaza in U.P. on N.H.25 which commenced on 9th March, 2013. However due to breach of contract terms and conditions by NHAI, resulting in continued losses, the Company disputed and terminated the contract and went into arbitration. The losses incurred by the Company due to the said contract were fully provided in the earlier years. After due proceedings, the arbitrator has given award in favour of the Company during the F.Y. 2015-16. Accordingly, the principal amount of the award of Rs. 1,247 Lakhs was recognized as income by the Company and included in other income during F.Y. 2015-16. NHAI has filed an appeal against the said Arbitration award in the Honâble Delhi High Court. On the basis of the arbitration award and legal counsel, the management is virtually certain that the matter will be decided in Companyâs favour. The case is yet to be decided by the Honâble Delhi High Court.
10. The Company is entitled to interest subsidy on certain term loans obtained under Technology Upgradation Fund Scheme (âTUFSâ) of Central Government and Incentive from Rajasthan Govt. under Rajasthan Investment Promotion Policy (RIPS) 2003, which has been hitherto claimed as revenue instead of capital receipt while computing the total income, however based on the judicial decisions the same has been now been claimed as capital receipt on the assessment / revised returns. The effect thereof on tax is included in earlier years tax adjustments Rs. 2194 Lakhs (Previous Year Rs. 520 Lakhs).
With the amendment in the taxation provisions to treat the above income and incentives as revenue items w.e.f. F.Y. 2015-16, the same are accounted for as revenue items since then in compliance with the above amendments.
11. In the F.Y. 2010-11, The Company had written off Rs. 408 Lakhs export incentive receivable under the Target Plus Scheme related to F.Y. 2005-06 due to Notification dated 12th June, 2006 by which Govt. reduced the incentive from 15% to 5% on incremental exports with retrospective effect from 01.04.2005. Subsequently based on the Honâble High Court Judgement passed on dated 5th May, 2016 with regard to Target Plus Scheme Scrips for the exports pertaining to the F.Y. 2005-06 where by the Honâble High Court has ordered that incentive can not be withdrawn with retrospective effect. The Company had filed its claim in view of the said Honâble High Court judgement, Based on this The Company is entitled to receive the differential incentive and have therefore accounted for the same in previous Financial Year 2016-17.
12. DISCLOSURE OF RELATED PARTY TRANSACTIONS PURSUANT TO IND AS 24 â RELATED PARTY DISCLOSURES
(A) Details of Related Parties
1 Wholly Owned Subsidiary Company
Sangam Lifestyle Ventures Limited
2 Key Managerial Personnel (KMP)
Shri R.P. Soni Shri S.N. Modani Shri V.K. Sodani Shri Anil Jain
3 Non Executive Director/ Independent Director
Shri Ramawatar Jaju Shri Achintya Karati Shri T.K. Mukhopadhyay Ms. Seema Srivastava
4 Relatives of Key Managerial Personnel (KMP)
Smt. Radha Devi Smt. Mamta Modani Smt. Archana Sodani Smt. Anjana Thakur
Smt. Antima Bass Shri Anurag Soni Shri Pranal Modani
5 Other Related Parties
Mahalaxmi TMT Private Limited (Director common)
Raj Rajeshwar Enterprises Private Limited (Relative of Director is member) Shri R.P. Soni HUF (Director is karta)
M/s Badri Lal Soni Charitable Trust (Director is trustee)
M/s Kesar Bai Soni Charitable Trust (Director is trustee)
Sangam Business Credit Limited (Person Acting in Concert)
Nikita Credits Private Limited (Person Acting in Concert)
Fashion Funda.Com Private Limited (Person Acting in Concert)
13. SEGMENT INFORMATION Operating Segment
Based on the management approach as defined in IND AS 108 - Operating Segments, the Chief Operating Decision Maker (âCODMâ) evaluates the Companyâs performance and allocates resources based on an analysis of various indicators of business segment/s in which the Company operates. The Company is primarily engaged in the business of textile manufacturing which the management and CODM recognise as the sole business segment. Hence disclosure of segment-wise information is not required and accordingly not provided.
The other applicable information applicable where there is only one segment as required in accordance with IND AS 108 - Operating Segments, are as under:
(a) The Company does not have the information in respect of the revenues from external customers for each product and service, or each group of similar products and services, and the cost to develop such system will be highly excessive. Accordingly such information is not disclosed as allowed by para 32 of IND AS 108.
Revenues from external customers attributed to an individual foreign country are not material. The revenue from the foreign countries are attributed from the countries wherein the actual exports are made.
There are no assets in foreign countries held by the Company except the amounts due from the exports.
(c) The Company does not have any major single customers / group of external customer having 10% of its revenue.
14. EMPLOYEE BENEFITS
The Company contributes to the following post-employment defined benefit plans in India.
(i) Defined Contribution Plans:
The Company makes contributions towards provident fund to a defined contribution retirement benefit plan for qualifying employees. Under the plan, the Company is required to contribute a specified percentage of payroll cost to the retirement benefit plan to fund the benefits.
(ii) Defined Benefit Plan:
The Company provides for gratuity for employees in India as per the Payment of Gratuity Act, 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The amount of gratuity payable on retirement/termination is the employees last drawn basic salary per month computed proportionately for 15 days salary multiplied for the number of years of service. Gratuity liability is being contributed to the gratuity fund formed by the company. Company makes contributions to Group Gratuity Schemes administrated by the LIC of India.
Other long term employee benefit plans
Compensated absences
Every employee is entitled to paid leave as per the companyâs policies. The employees are allowed to avail leave and carry forward a specified number of days, the same is encashable during the service period and at the time of separation from the company or retirement, whichever is earlier.
The most recent actuarial valuation of plan assets and the present value of the defined benefit obligation for gratuity were carried out as at 31st March, 2018. The present value of the defined benefit obligations and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.
A. Based on the actuarial valuation obtained in this respect, the following table sets out the status of the gratuity plan and the amounts recognized in the Companyâs financial statements as at balance sheet date:
B. Movement in net defined benefit (asset) liability
The following table shows a reconciliation from the opening balances to the closing balances for net defined benefit (asset) liability and its components:
E. Sensitivity analysis
Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have affected the defined benefit obligation by the amounts shown below.
Sensitivities due to mortality & withdrawals are insignificant & hence ignored. Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump sum benefit on retirement.
Although the analysis does not take account of the full distribution of cash flows expected under the plan, it does provide an approximation of the sensitivity of the assumptions shown.
F. Description of Risk Exposures:
Valuations are based on certain assumptions, which are dynamic in nature and vary over time. As such company is exposed to various risks as follow -
A) Salary Increases- Actual salary increases will increase the Planâs liability. Increase in salary increase rate assumption in future valuations will also increase the liability.
B) Investment Risk - If Plan is funded then assets liabilities mismatch & actual investment return on assets lower than the discount rate assumed at the last valuation date can impact the liability.
C) Discount Rate: Reduction in discount rate in subsequent valuations can increase the planâs liability.
D) Mortality & disability - Actual deaths & disability cases proving lower or higher than assumed in the valuation can impact the liabilities.
E) Withdrawals - Actual withdrawals proving higher or lower than assumed withdrawals and change of withdrawal rates at subsequent valuations can impact Planâs liability.
The weighted average duration of the defined benefit plan obligation at the end of the reporting period is 19.19 years (31st March, 2017: 19.57 years)
II. Financial risk management
The Company has exposure to the following risks arising from financial instruments:
- credit risk;
- liquidity risk; and
- market risk
i. Risk management framework
The Companyâs board of directors has overall responsibility for the establishment and oversight of the Companyâs risk management framework. The board of directors has established the processes to ensure that executive management controls risks through the mechanism of property defined framework.
The Companyâs risk management policies are established to identify and analyze 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 by the board annually to reflect changes in market conditions and the Companyâs activities. The Company, through its training and management standards and procedures, aims to maintain a disciplined and constructive control environment in which all employees understand their roles and obligations.
The Companyâs Audit Committee oversees compliance with the Companyâs risk management policies and procedures, and reviews the adequacy of the risk management framework in relation to the risks faced by the Company. The Audit Committee is assisted in its oversight role by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.
ii. Credit risk
Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Companyâs receivables from customers and investments in debt securities.
The carrying amount of financial assets represents the maximum credit exposure. The Company monitor credit risk very closely both in domestic and export market. The Management impact analysis shows credit risk and impact assessment as low.
Trade and other receivables
The Companyâs exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk of the industry and country in which customers operate.
The Company Management has established a credit policy under which each new customer is analyzed individually for creditworthiness before the Companyâs standard payment and delivery terms and conditions are offered. The Companyâs review includes market check, industry feedback, past financials and external ratings, if they are available, and in some cases bank references.
The Company establishes an allowance for impairment that represents its expected credit losses in respect of trade and other receivables. The management uses a simplified approach for the purpose of computation of expected credit loss for trade receivables
The Companyâs exposure to credit risk is influenced mainly by the individual characteristics of each customer. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk of the industry and country in which customers operate.
The gross carrying amount of trade receivables is Rs. 32,908 Lakhs (31st March, 2017 - Rs. 26,046 Lakhs , 1st April, 2016 - Rs. 27,296 Lakhs).
During the period, the Company has made no write-offs of trade receivables, it does not expect to receive future cash flows or recoveries from collection of cash flows previously written off. The Company management also pursue all legal option for recovery of dues wherever necessary based on its internal assessment
A default on a financial asset is when counterparty fails to make payments within 60 days when they fall due.
iii. Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Companyâs approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Companyâs reputation.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the cash flows generated from operations to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, the Companyâs treasury maintains flexibility in funding by maintaining availability under committed credit lines.
Management monitors rolling forecasts of the Companyâs liquidity position comprising the undrawn borrowing facilities and cash and cash equivalents on the basis of expected cash flows. This is generally carried out in accordance with practice and limits set by the Company. In addition, the Companyâs liquidity management policy involves projecting cash flows in major currencies and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.
(a) Maturities of financial liabilities
The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted, and exclude contractual interest payments and the impact of netting agreements.
The inflows/(outflows) disclosed in the above table represent the contractual undiscounted cash flows relating to derivative financial liabilities held for risk management purposes and which are not usually closed out before contractual maturity.
iv. Market risk
Market risk is the risk that changes in market prices - such as foreign exchange rates and interest rates - will affect the Companyâs income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.
Currency risk
The Company is exposed to foreign exchange risk arising from foreign currency transactions, primarily with respect to the USD and small exposure in EURO. Foreign exchange risk arises from future commercial transactions and recognized assets and liabilities denominated in a currency that is not the companyâs functional currency . The risk is measured through a forecast of highly probable foreign currency cash flows. The objective of the hedges is to minimize the volatility of the cash flows of highly probable forecast transactions by hedging the foreign exchange inflows on regular basis.
Sensitivity analysis
A reasonably possible strengthening (weakening) of the â against all currencies at 31st March would have affected the measurement of financial instruments denominated in a foreign currency and affected equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant.
Interest rate risk
The Companyâs main interest rate risk arises from long-term borrowings with variable rates, which expose the Company to cash flow interest rate risk.
Currently the Companyâs borrowings are within acceptable risk levels, as determined by the management, hence the Company has not taken any swaps to hedge the interest rate risk.
Exposure to interest rate risk
The interest rate profile of the Companyâs interest-bearing financial instruments as reported to the management of the Company is as follows.
Cash flow sensitivity analysis for variable-rate instruments
A reasonably possible change of 100 basis points in interest rates at the reporting date would have increased (decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency exchange rates, remain constant.
Fair value sensitivity analysis for fixed-rate instruments
The Company does not account for any fixed-rate financial assets or financial liabilities at fair value through profit or loss. Therefore, a change in interest rates at the reporting date would not affect profit or loss.
Hedge Accounting
The Companyâs business objective includes safe-guarding its earnings against foreign exchange fluctuations. The Company has adopted a structured risk management policy to hedge all these risks within an acceptable risk limit and an approved hedge accounting framework which allows for Fair Value hedges. Hedging instruments include forwards contracts to achieve this objective. The table below shows the position of hedging instruments and hedged items as on the balance sheet date.
15. FIRST TIME ADOPTION OF IND AS
As stated in Note 1.1, these are the Companyâs first financial statements prepared in accordance with Ind AS.
The accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended 31st March, 2018, the comparative information presented in these financial statements for the year ended 31st March, 2017 and in the preparation of an opening Ind AS statement of financial position at 1st April, 2016 (the Companyâs date of transition). In preparing its opening Ind AS statement of financial position, the Company has adjusted amount reported previously in financial statements prepared in accordance with Indian GAAP (previous GAAP). An explanation of how the transition from previous GAAP to Ind AS has affected the Companyâs financial position, financial performance and cash flows is set out in the following tables and the notes that accompany the tables.
Exemptions and Exceptions availed:
Set out below are the applicable Ind AS 101 optional exemptions and mandatory exceptions applied in the transition from previous GAAP to Ind AS.
A. IND AS OPTIONAL EXEMPTIONS
(i) 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 per the previous GAAP and use that as its deemed cost as at the date of transition after making necessary adjustments for de-commissioning liabilities. This exemption can also be used for intangible assets covered by Ind AS 38 Intangible Assets.
(ii) Investment in Subsidiaries, Joint Ventures and Associates
Ind AS 101 permits a first-time adopter to elect to continue with the carrying value for all of its investment in Subsidiaries, Joint Ventures and Associates as recognized in the financial statements as at the date of transition to Ind AS, measured as per the previous GAAP and use that as its deemed cost as at the date of transition. Accordingly, the Company has opted to measure all of its investments in Associates at their previous GAAP carrying value.
B. IND AS MANDATORY EXCEPTIONS
(i) Estimates
An entityâs estimates in accordance with Ind AS at the date of transition to Ind AS shall be consistent with estimates made for the same date in accordance with previous GAAP (after adjustments to reflect any difference in accounting policies), unless there is 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 made in conformity with previous GAAP. The Company made estimates for Impairment of financial assets based on expected credit loss model in accordance with Ind AS at the date of transition as these were not required under previous GAAP.
(ii) Classification and measurement of financial assets
Ind AS 101 requires an entity to assess classification and measurement of financial assets on the basis of the facts and circumstances that exist at the date of transition to Ind AS.
C RECONCILIATIONS BETWEEN PREVIOUS GAAP AND IND AS
Ind As 101 requires an entity to reconcile Equity, Total Comprehensive Income and Cash Flow for prior periods. The following tables represent the reconciliations from previous GAAP to Ind AS.
D. NOTES TO FIRST TIME ADOPTION
1 Proposed Dividend
Under the previous GAAP, dividends proposed by the board of directors after the balance sheet date but before the approval of the financial statements were considered as adjusting events. Accordingly, provision for proposed dividend was recognized as a liability. Under Ind AS, such dividends are recognized when the same is approved by the shareholders in the general meeting. Accordingly, the liability for proposed dividend and tax thereon of Rs. 949 Lakhs as at 1st April, 2016 included under provisions has been reversed with corresponding adjustment to retained earnings. Consequently, the total equity increased by an equivalent amount.
2 Remeasurements of post-employment benefit obligations
Under Ind AS, remeasurements i.e. actuarial gains and losses and the return on plan assets, excluding amounts included in the net interest expense on the net defined benefit liability are recognized in other comprehensive income instead of statement of profit and loss. Under the previous GAAP, these remeasurements were forming part of the statement of profit and loss for the year. As a result of this change, the profit for the year ended 31st March, 2017 increased by Rs. 24 Lakhs . There is no impact on the total equity as at 31st March, 2017.
3 Deferred Tax
Under previous GAAP, deferred tax was prepared using income statement approach. Under Ind AS, company has prepared deferred tax using balance sheet approach. Also, deferred tax have been recognized on the adjustments made on transition to Ind AS.
4 Retained earnings
Retained earnings as at 1st April, 2016 has been adjusted consequent to the above Ind AS transition adjustments.
5 Excise Duty
Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented as expenses. This change has resulted in an increase in total revenue and total expenses for the year ended 31st March, 2017 by Rs. 3673 Lakhs. There is no impact on the total equity and profit.
Fair valuation of derivatives
The Company has taken forward contracts to hedge foreign currency receivables/payable. Under previous GAAP AS 11 accounting was followed to account for these contracts. Under Ind AS all these derivatives has been valued at fair value as per Ind AS 109.
6 Other Comprehensive Income
Under Ind AS, all items of income and expense recognized in a period should be included in the statement of profit and loss for the period, unless a standard requires or permits otherwise. Items of income and expense that are not recognized in profit or loss but are shown in the statement of profit and loss as âother comprehensive incomeâ includes remeasurements of defined benefit plans and tax thereon. The concept of other comprehensive income did not exist under previous GAAP.
c) Out of above Rs. 80 Lakhs (Previous Year Rs. 23 Lakhs) has been spent through M/s Badri Lal Soni Charitable Trust and Rs. 21 Lakhs (Previous year Rs. 21 Lakhs) has been spent through M/s Kesar Bai Soni Charitable Trust, which are related parties.
16. STANDARD ISSUED BUT NOT EFFECTIVE
On 28th March, 2018 the Ministry of Corporate Affairs (MCA) has notified Ind AS 115 - Revenue from Contract with Customers and certain amendment to existing Ind AS. These amendments shall be applicable to the Company from 1st April, 2018
(a) Issue of Ind AS 115 - Revenue from Contracts with Customers
I nd AS 115 will supersede the current revenue recognition guidance including Ind AS 18 Revenue, Ind AS 11 Construction Contracts and the related interpretations. Ind AS 115 provides a single model of accounting for revenue arising from contracts with customers based on the identification and satisfaction of performance obligations.
(b) Amendment to Existing issued Ind AS
The MCA has also carried out amendments of the following accounting standards:
i. Ind AS 21 - The Effects of Changes in Foreign Exchange Rates
ii. Ind AS 40 - Investment Property
iii. Ind AS 12 - Income Taxes
iv. Ind AS 28 - Investments in Associates and Joint Ventures and
v. Ind AS 112 - Disclosure of Interests in Other Entities
Application of above standards are not expected to have any significant impact on the Companyâs Financial Statements.
17. CAPITAL MANAGEMENT
The Companyâs policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the business. Management monitors the return on capital as well as the level of dividends to ordinary shareholders.
18. APPROVAL OF FINANCIAL STATEMENTS
The Financial Statements were approved for issue by the Board of Directors on 30th May, 2018.
The Board of Directors have recommended a dividend @10% on equity share, subject to approval from the shareholders at the ensuing AGM.
Mar 31, 2016
Results of the other segment have not been shown separately as the same is not material.
1 All Term Loans from banks (including current maturities) except vehicle loan are secured by a joint equitable mortgage by deposit of title deeds in respect of immovable properties and first hypothecation of the entire moveable properties of the company , both present and future (save and except book debts) subject to prior charges created/to be created in favour of bankers for securing working capital borrowing, ranking pari-passu with the charges created/to be created in favour of other participating institutions and banks. The above Term Loans are further secured by personal guarantee of two directors of the company.
2 Vehicle Loans (including current maturities) are secured by hypothecation of respective vehicle(s) and are repayable over the term of the loan ranging from 2 to 7 years.
3 Foreign Currency Loans (Buyers'' Credit) Rs. 1663 Lakhs (Previous year Rs. Nil) are related to Fixed Assets, ultimate payment of which will be from Term Loans.
4 Maturity Profile of Secured Term Loans are as set out below:
5 Dues to micro, small and medium enterprises:-
The Company is in the process of compiling relevant information from its suppliers about their coverage under the Micro, Small and Medium Enterprises Development Act, 2006. Since the relevant information is not readily available, no disclosure have been made in the accounts. However, in view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this Act is not expected to be material.
6 The company had executed a toll user fee collection contract with NHAI for Usaka Toll Plaza in U.P. on N.H.25 which commenced on 9th March, 2013. However due to breach of contract terms and conditions by NHAI, resulting in continued losses, the company disputed and terminated the contract and went into arbitration. The losses incurred by the Company due to the said contract were fully provided in the earlier years. After due proceedings, the arbitrator has given award in favour of the Company. The principal amount of the award of Rs. 12.47 Crores has been recognized as income by the company and included in other income. NHAI has filed an appeal against the said Arbitration award in the Hon''ble Delhi High Court. On the basis of the arbitration award and legal counsel, the management is virtually certain that the matter will be decided in Company''s favour
7 The Company has initiated the CSR spending in accordance with section 135 of the companies Act, 2013 though full required amount as per provisions was not spent during the year. The company has since close of the year further initiated various objectives for full spending during the next year as per CSR provisions.
I In the opinion of Management, there is no impairment of assets in accordance with accounting standard (AS-28) as on Balance Sheet date.
The Company has been entitled for capital subsidy on the amount of Investment in Plant & Machinery, i.e. 10% of the basic price 37 of Machinery. The amount of Capital subsidy deducted from Gross Value of Plant & Machinery is Rs. 233 Lakhs (Previous Year Rs. 229 Lakhs)
ââ The Balance Sheet of the Company has been prepared as per Schedule III of the Companies Act 2013. The figures of the previous I period have been re-grouped / re-arranged and / or recast wherever found necessary.
Mar 31, 2015
1. As per Accounting standard (As) 17 on "segment Reporting, segment
Information has been provided As under:-
i) primary/ secondary segments:
a) The risk-return profile of the Company's business is determined
predominantly by the nature of its products and services. Accordingly,
the business segments constitute the primary segments for disclosure of
segment information.
b) In respect of secondary segments information, the Company has
identified its geographical segments as (i) domestic and (ii) overseas.
The secondary segment information has been disclosed accordingly.
2. Interest IN Joint venture company
There is no Joint Venture Investments / Jointly controlled operations
as on 31.03.2015 However the Company had the following interest in its
Joint Venture Companies as on 31.03.2014:
Keti Sangam Infrastructure (India) Ltd. (Country of Incorporation:
India)
The Company had 7,80,600 equity shares of Rs. 10 each at premium of Rs. 90
per equity share [ 26.02% equity as on 31.03.14 ] in the Joint Venture
Company M/s. Keti Sangam Infrastructure (India) Ltd. for execution of
BOT Project at Aurangabad National Highway.
(Rs,in Lacs)
As at 31st As at 31st
March, 2015 March, 2014
3. contingent Liabilities
AND commitments
I. contingent Liabilities
A. Disputed liabilities not
acknowledged as debts
Demand for income tax 29 21
B. Guarantees
Outstanding Bank Guarantees 1,369 2,002
C. Other Money for which the
company is contingently liable
(i) Liability in respect of
bills discounted with Banks - 37
(including third party bills
discounting)
(ii) Stamp Duty case with respect
to the merger of SPBL &
Sangam (India) Limited
pending with 109 109
Rajasthan High Court,
Jodhpur.
(iii) Sales Tax case pending
with Tax Board, Ajmer and
Dy. Comm. Appeal. 167 72
The Demand raised for
input tax credit not
reversed properly.
(iv) AVVNL case (Power Factor
matter) pending with
Rajasthan High Court,
Jodhpur. Company has
provided fully.
(v) Various cases pending
with Central Excise & 11 15
Service Tax (Nett
amount ully provided)
(vi) Case pending with
Rajasthan High Court, 20 20
Jodhpur under Electricity
Act, 2003
(vii) Entry Tax case pending
with Rajasthan High Court,
Jodhpur. Entry Tax Levied
by State Govt. which is
challenged by us due to
this Law is against the
Constitution, However
company has provided the
demand amount ully. The
Company is contingently
liable to the Interest and
Penalty, the amount for
which is currently
undertrained.
(viii) Disputes on the various
tolls for which company 464 464
is contingently liable
(ix) Sales Tax case pending
with CTO, Bhilwara.
The demand raised for VAT
with RIPS Incentive 341
on export.
II. commitments
A. Estimated amount of contracts (Net of advances) remaining to be
executed on capital account and not 6,212 6,342 provided for
B. obligations
In respect of capital goods imported at the concessional rate of duty
under the Export Promotion Capital Goods Scheme, the company has an
export obligation of approximately Rs. NIL (Previous Year Rs. 1021 Lacs),
which is required to be met at different dates, before 31.03.2020. In
the event of non-fulfillment of the export obligation, the company will
be liable to pay custom duties and penalties, as applicable.
4. Though the company has been supporting various charity projects
however in view of recent guidelines for expenditure on CSR activities,
the Board of Directors of the company has appointed CSR committee which
is exploring best avenues within the allowable expenditure on CSR and
pending same, the company though has not spend any amount during the
year, however it has decided to carry CSR activities during the next
financial year onwards.
5. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
6. The Company has been entitled for capital subsidy on the amount of
Investment in Plant & Machinery, i.e. 10% of the basic price of
Machinery. The amount of Capital subsidy deducted from Gross Value of
Plant & Machinery is Rs. 229 Lacs (Previous Year Rs. NIL Lacs).
7. The Balance Sheet of the Company has been prepared as per Schedule
III of the Companies Act 2013. The figures of the previous period have
been re-grouped / re-arranged and / or recast wherever found necessary.
Mar 31, 2014
(Rs. in Lacs)
Particulars 2013-14 2012-13
1. CONTINGENT LIABILITIES AND COMMITMENTS
(I) CONTINGENT LIABILITIES
(A) Disputed liabilities not acknowledged
as debts
Demand for income tax 21 21
(B) Guarantees
Outstanding Bank Guarantees 2002 2499
(C) Other Money for which the company is
contingently liable
(i) Liability in respect of bills discounted 37 481
with Banks (including third party
bills discounting)
(ii) Stamp Duty case with respect to the merger 109 109
of SPBL & Sangam India Limited pending with
Rajasthan High Court, Jodhpur.
(iii) Sales tax case pending with Tax Board, 72 194
Ajmer and Dy. Comm. Appeal. The Demand
raised for input tax credit not reversed
properly.
(iv) AVVNL case (Power Factor matter) pending - 39
with Rajasthan High Court, Jodhpur. Company
has provided fully.
(v) Various cases pending with Central Excise & 15 -
Service Tax (Nett of amount fully provided)
(vi) Case pending with Rajasthan High Court, 20 -
Jodhpur under Electricity Act, 2003
(vii) Entry Tax case pending with Rajasthan - -
High Court, Jodhpur. Entry Tax Levied by
State Govt. which is challenged by us due
to this Law is against the Constitution,
However company has provided the demand
amount fully. The Company is contigently
liable to the Interest and Penalty, the
amount for which is currently uncertained.
(viii) Disputes on the various tolls for which 464 -
company is contingently liable
(II) COMMITMENTS
(A) Estimated amount of contracts (Net of advances) remaining to be
6342 2869 executed on capital account and not provided for
(B) Obligations
In respect of capital goods imported at the concessional rate of duty
under the Export Promotion Capital Goods Scheme, the company has an
export obligation of approximately Rs. 1021 Lacs (Previous Year Rs.
1339 Lacs), which is required to be met at different dates, before
31.03.2020. In the event of non-fulfillment of the export obligation,
the company will be liable to pay customs duties and penalties, as
applicable. The company is confident of meeting its export obligation.
2. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
3. The company has been entitled for capital subsidy on the amount of
Investment in Plant & Machinery, i.e. 10% of the basic price of
Machinery. The amount of Capital subsidy deducted from Gross Value of
Plant & Machinery is Rs. NIL (Previous Year Rs. 17 Lacs).
4. The figures of the previous period have been re-grouped /
re-arranged and / or recast wherever found necessary.
Mar 31, 2013
1. AS PER ACCOUNTING STANDARD (AS) 17 ON "SEGMENT REPORTING, SEGMENT
INFORMATION HAS BEEN PROVIDED AS UNDER:
Primary/ secondary segments:
a) The risk-return profile of the Company''s business is determined
predominantly by the nature of its products and services. Accordingly,
the business segments constitute the primary segments for disclosure of
segment information.
b) In respect of secondary segments information, the Company has
identified its geographical segments as (i) domestic and (ii) overseas.
The secondary segment information has been disclosed accordingly.
Segment composition:
The Company operates mainly in two segments i.e. Textile & Toll Plaza.
The Company is also having Wind Power Plant and some miscellaneous
activities operation which is included in Textile Segment. Toll Plaza
segment of the Company comprises of collection of user fees by the
Company in accordance with the contracts entered into by the Company
with the National Highways Authority of India.
1.1 The Company has been awarded toll plazas for collection of user
fee in lieu of transferring Central Government''s user fee collection
rights for the said toll plazas of the National Highway Authority of
India. Under these agreements, the operator does not own the road, but
gets toll collection rights.
2. INTEREST IN JOINT VENTURE COMPANY
The Company has the following interest in its Joint Venture Companies:
I. Keti Sangam Infrastructure (India) Ltd. (Country of Incorporation:
India)
The Company is holding 7,80,600 (Previous Year 7,80,600 ) equity shares
of Rs. 10 each at premium of Rs. 90 per equity share [26.02% equity as on
31.03.13 ( previous year 26.02% )] in the Joint Venture Company M/s.
Keti Sangam Infrastructure (India) Ltd. for execution of BOT Project at
Aurangabad National Highway.
II. PKSS Infrastructure Pvt. Ltd./ Kalyan Sangam Infratech Ltd.
(Country of Incorporation: India)
The Company had originally participated in the joint venture for MCD
toll collection project i.e. PKSS Infrastructure Pvt. Ltd. and for BOT
Project at Thane-Bhiwadi i.e. Kalyan Sangam Infratech Ltd. and the
Company holds the investment of Rs. 39,000 in PKSS Infrastructure Pvt.
Ltd. by way of 3,900 (Previous Year 3,900) equity shares of Rs. 10 each
[2.48% equity as on 31.03.13 ( 2.48% equity as on 31.03.12) ] and Rs.
3.75 lacs in Kalyan Sangam Infratech Ltd. by way of 37,500 ( Previous
Year 37,500 ) equity shares of Rs. 10 each [ 0.75 % equity as on 31.03.13
( 0.75 % equity as on 31.03.12)].
III. The Company''s proportionate share in the assets, liabilities,
income and expenses of its Joint Venture Company Keti Sangam
Infrastructure (India) Ltd. Is 26.02% (Previous Year 26.02%) of the
below total:
3. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
4. The company has been entitled for capital subsidy on the amount of
Investment in Plant & Machinery, i.e. 10% of the basic price of
Machinery. The amount of Capital subsidy deducted from Gross Value of
Plant & Machinery is Rs.17 Lacs (Previous Year Rs.380 Lacs).
5. The figures of the previous period have been re-grouped /
re-arranged and / or recast wherever found necessary.
Mar 31, 2012
AS PER ACCOUNTING STANDARD (AS) 17 ON SEGMENT REPORTING, SEGMENT
INFORMATION HAS BEEN PROVIDED AS UNDER
Primary/ secondary segments:
a) The risk-return profile of the Company's business is determined
predominantly by the nature of its products and services. Accordingly,
the business segments constitute the primary segments for disclosure of
segment information.
b) In respect of secondary segments information, the Company has
identified its geographical segments as (i) domestic and (ii)
overseas. The secondary segment information has been disclosed
accordingly.
Segment composition:
The Company operates mainly in two segments i.e. Textile & Toll Plaza.
The Company is also having Wind Power Plant and some miscellaneous
activities operation which is included in Textile Segment. Toll Plaza
segment of the Company comprises of collection of user fees by the
Company in accordance with the contracts entered into by the Company
with the National Highways Authority of India.
1. THE COMPANY HAS BEEN AWARDED TOLL PLAZAS FOR COLLECTION OF USER
FEE IN LIEU OF TRANSFERRING CENTRAL GOVERNMENTS USER FEE COLLECTION
RIGHTS FOR THE SAID TOLL PLAZAS OF THE NATIONAL HIGHWAY AUTHORITY OF
INDIA. UNDER THESE AGREEMENTS, THE OPERATOR DOES NOT OWN THE ROAD, BUT
GETS TOLL COLLECTION RIGHTS.
2. INTEREST IN JOINT VENTURE COMPANY
The Company has the following interest in its Joint Venture Companies:
I. Keti Sangam Infrastructure (India) Ltd. (Country of Incorporation:
India)
The Company is holding 7,80,600 (Previous Year 7,80,600 ) equity shares
of Rs. 10 each at premium of Rs. 90 per equity share [ 26.02% equity as on
31.03.12 ( previous year 26.02% ) ] in the Joint Venture Company M/s.
Keti Sangam Infrastructure (India) Ltd. for execution of BOT Project at
Aurangabad National Highway.
II. PKSS Infrastructure Pvt. Ltd./ Kalyan Sangam Infratech Ltd.
(Country of Incorporation: India)
The Company had originally participated in the joint venture for MCD
toll collection project i.e. PKSS Infrastructure Pvt. Ltd. and for BOT
Project at Thane-Bhiwadi i.e. Kalyan Sangam Infratech Ltd. and the
Company holds the investment of Rs. 39,000 in PKSS Infrastructure Pvt.
Ltd. by way of 3,900 (Previous Year 3,900) equity shares of Rs. 10 each
[2.48% equity as on 31.03.12 ( 2.48% equity as on 31.03.11) ] and Rs.
3.75 lacs in Kalyan Sangam Infratech Ltd. by way of 37,500 ( Previous
Year 37,500 ) equity shares of Rs. 10 each [ 0.75 % equity as on 31.03.12
( 0.75 % equity as on 31.03.11)]
I RELATED PARTY DISCLOSURES:
(i) Related Party Transactions
As per Accounting Standard (AS-18) on Related Party Disclosures issued
by ICAI, the disclosures of related parties as Defined in the
Accounting Standard is given below:
Enterprises over which Directors and Relatives of such personnel
exercise significant influence
Associate Company
Sangam Infratech Ltd. Marigold Investments (P) Ltd. Sangam Business
Credit Ltd. Sangam Suitings Pvt. Ltd. Mahalaxmi TMT Pvt. Ltd.
Joint Venture
Keti Sangam Infrastructure (India) Ltd. PKSS Infrastructure Pvt. Ltd.
Kalyan Sangam Infratech Ltd.
Key Management Personnel
Shri R.P. Soni Shri S.N. Modani Shri V.K. Sodani
Relative of Key Management Personnel Relationship
Smt. Radha Devi Wife of Director Shri R.P. Soni
Ms. Antima Soni Daughter of Director Shri R.P. Soni
Shri Anurag Soni Son of Director Shri R.P. Soni
Shri Pranal Modani Son of Director Shri S.N. Modani
Smt. Mamta Modani Wife of Director Shri S.N. Modani
Smt. Archana Sodani Wife of Director Shri V.K. Sodani
Smt. Anjana Thakur Daughter of Director Shri R.P. Soni
Others
Shri R.P. Soni HUF
(Rs. in lacs)
3. CONTINGENT LIABILITIES AND COMMITMENTS
Particulars 2011-12 2010-11
(I) CONTINGENT LIABILITIES
(A) Disputed liabilities not acknowledged
as debts
Demand for income tax 21 21
(B) Guarantees
Outstanding Bank Guarantees 2,811 3,067
(C) Other Money for which the company
is contingently liable
Liability in respect of bills
discounted with Banks
(including third party bills 1,259 776
discounting)
(II) COMMITMENTS
(A) Estimated amount of contracts (Net of advances) remaining to be
executed on 1,352 3,807 capital account and not provided for
(B) Obligations
In respect of capital goods imported at the concessional rate of duty
under the Export Promotion Capital Goods Scheme, the company has an
export obligation of approximately Rs.6840 Lacs (previous year Rs.4440
Lacs), which is required to be met at different dates, before
31.03.2020. In the event of non-fulfi llment of the export obligation,
the company will be liable to pay customs duties and penalties, as
applicable. The company is confident of meeting its export obligation.
4. During the previous year, out of the total outstanding of Rs. 622
Lacs towards the incentive receivable under the target plus scheme for
the year 2005-06, an amount of Rs. 407.60 Lacs had been written off
towards outstanding balance in the target plus incentive account as the
company has considered that this amount was no longer receivable in
view of Government Policy, after disposal of the total benefits
actually received under the target plus scheme. The Company has however
subjudiced the decision.
5. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
6. During the year the company has been entitled for capital subsidy
on the amount of Investment in Plant & Machinery, i.e. 10% of the basic
price of Machinery. The amount of Capital subsidy deducted from Gross
Value of Plant & Machinery is Rs. 380 Lacs (Previous Year Nil)
7. The revised Schedule VI as notified under the Companies Act,
1956, has become applicable to the Company for presentation of its fi
nancial statements for the year ending March 31, 2012. The adoption of
the revised Schedule VI requirements has significantly modified the
presentation and disclosures which have been complied with in these fi
nancial statements. Previous year figures have been reclassified in
accordance with current year requirements.
Mar 31, 2011
1 (I) CONTINGENT LIABILITIES
a) Outstanding Bank Guarantees Rs. 3067.07 lacs (previous year Rs.
1735.13 lacs)
b) Estimated amounts of contracts (net of advances) remaining
un-executed on Capital account Rs. 3806.87 lacs (previous year Rs.
1059.59 lacs).
c) Demand for excise duty disputed by the company Rs. Nil. (previous
yearRs. 3.89 lacs).
d) Demand for income tax disputed by the company Rs. 21.00 lacs
(previous year Rs. 21.00 lacs).
(II) OBLIGATIONS AND COMMITMENTS OUTSTANDING
In respect of capital goods imported at the concessional rate of duty
under the Export Promotion Capital Goods Scheme, the company has an
export obligation of approximately Rs. 4440 lacs (previous year 13947
lacs), which is required to be met at differ- ent dates, before
31.03.2017. In the event of non-fulfillment of the export obligation,
the company will be liable to pay customs duties and penalties, as
applicable. The company is confident of meeting its export obligation.
2. Debtors/Creditors are shown net of advances from/to Customers/
Suppliers and are subject to confirmation.
3. Dues to small-scale industrial undertakings and dues to micro en-
terprises and small enterprises
The Company is in the process of compiling relevant information from
its suppliers about their coverage under the Micro, Small and Medium
Enterprises Development Act, 2006. Since the relevant in- formation is
not readily available, no disclosures have been made in the accounts.
However, in view of the management, the impact of interest, if any,
that may be payable in accordance with the pro- visions of this Act is
not expected to be material.
4. Detail of pre operative expenses capitalised/deferred for capitali-
sation under the head Capital Work in Progress.
5. During the year exchange fluctuation gain on export sales included
in the sales is Rs. 406.11 lacs (Previous year Rs. 480.87 lacs)
6. Financial and Derivative Instruments (For Hedging Currency Risks)
and Unhedged Foreign Currency Exposure
b) Unhedged Foreign Currency Exposure: - $ 7.11 Lacs (Rs. 317.10 Lacs)
(Previous Year $12.31 Lacs, Rs. 552.97 Lacs). This relates to IDBI
foreign currency loan.
7. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
8. Out of the total outstanding of Rs. 622 Lacs towards the incentive
receivable under the target plus scheme for the year 2005-06, an amount
of Rs. 407.60 Lacs has been written off during the year to- wards
outstanding balance in the target plus incentive account as the company
considers that this amount is no longer receivable in view of
Government Policy, after disposal of the total benefits actually
received under the target plus scheme. The Company has however
subjudiced the decision.
9. The advances recoverable includes a sum of Rs. 8.87 crores
(previous year Rs. 18.27 crores) of insurance claim receivable on
account of claims lodged on insurance companies due to fire and other
losses suffered of company's various assets from time to time. The said
claims are under active consideration of the insurance company.
10. Managing Director/ Whole time Director Remuneration
11. Interest in Joint Venture Company
The company has the following interest in its Joint Venture Companies:-
I. Keti Sangam Infrastructure (India) Ltd (Country of Incorporation:
India)
The Company is holding 7,80,600 ( Previous Year 7,80,600) equity shares
of Rs. 10 each at premium of Rs. 90 per equity share [26.02% equity as
on 31.03.11 (Previous Year 26.02%)] in the Joint Venture Company M/s.
Keti Sangam Infrastructure (India) Ltd. for execution of BOT Project at
Aurangabad National Highway.
II. PKSS Infrastructure Pvt. Ltd./Kalyan Sangam Infratech Ltd.
(Country of Incorporation: India)
The Company had originally participated in the joint venture for MCD
toll collection project i.e. PKSS Infrastructure Pvt. Ltd. and for BOT
Project at Thane- Bhiwadi i.e. Kalyan Sangam Infratech Ltd and the
Company holds the investment of Rs. 39,000 in PKSS Infra- structure
Pvt. Ltd. by way of 3,900 ( Previous year 3,900) equity shares of Rs.
10 each [2.48% equity as on 31.03.11 (2.48% equity as on 31.03.10)] and
Rs. 3.75 lacs in Kalyan Sangam Infratech Ltd. by way of 37,500
(Previous Year 37,500) equity shares of Rs. 10 each [0.75% equity as on
31.03.11 (0.79% equity as on 31.03.10)].
12. Segment information
Primary/ secondary segments:
a) The risk-return profile of the Company's business is determined
predominantly by the nature of its products and services. Accord-
ingly, the business segments constitute the primary segments for
disclosure of segment information.
b) In respect of secondary segments information, the Company has
identified its geographical segments as (i) domestic and (ii) over-
seas. The secondary segment information has been disclosed ac-
cordingly.
Segment composition:
The Company operates mainly in two segments i.e. Textile & Toll Plaza.
The Company is also having Wind power plant and some mis- cellaneous
activities operation which is included in Textile Segment.
Toll plaza segment of the Company comprises of collection of user fees
by the Company in accordance with the contracts entered into by the
Company with the National Highways Authority of India.
13. During the current year, the company has been awarded toll plazas
for collection of user fee in lieu of transferring Central Govern-
ment's user fee collection rights for the said toll plazas of the Na-
tional Highway Authority of India for a period of one year. Under these
agreements, the operator does not own the road, but gets toll
collection rights.
14. i) Related Party Transactions
As per Accounting Standard (AS-18) on Related Party Disclosures issued
by the ICAI, the disclosure of related parties as defined in the
Accounting Standard is given below:
Relationship
Enterprises over which Directors and Relatives of such personnel
exercise significant influence
Associate Company
Sangam Infratech Ltd.
Marigold Investments (P) Ltd.
Sangam Business Credit Ltd.
Sangam Suitings Pvt. Ltd.
Mahalaxmi TMT Pvt. Ltd.
Joint Venture
Keti Sangam Infrastructure (India) Ltd.
PKSS Infrastructure Pvt. Ltd.
Kalyan Sangam Infratech Ltd.
Key Management Personnel
Shri R.P. Soni
Shri S.N. Modani
Shri V.K. Sodani
Relative of Key Management Personnel
Smt Radha Devi Wife of Director Shri R.P. Soni
Ms. Antima Soni Daughter of Director
Shri R.P. Soni
Shri Anurag Soni Son of Director Shri R.P. Soni
Shri Pranal Modani Son of Director Shri S.N. Modani
Smt. Mamta Modani Wife of Director Shri S.N. Modani
Smt. Archana Sodani Wife of Director Shri V.K. Sodani
Smt. Anjana Thakur Daughter of Director
Shri R.P. Soni
Others
Shri R.P Soni HUF
15. Figures for the previous year have been re-grouped, rearranged and
reclassified wherever considered necessary in correspondence with cur-
rent year.
16. The quantitative and other details as required under Para 3 and 4
of Part II of the Schedule VI of the Companies Act, 1956 are annexed
here to as per Annexure 'A'.
17. The detail as required under Part-IV of the schedule VI of the
Companies Act, 1956 as amended are given as per Annexure-B.
Mar 31, 2010
1 (i) Contingent Liabilities
a) Outstanding Bank Guarantees Rs. 1 735.1 3 lacs (previous year Rs.
723.13 lacs).
b) Estimated amounts of contracts (net of advances) remaining un-
executed on Capital account Rs. 1059.59 lacs (previous year Rs. 282.89
lacs).
c) Demand for excise duty disputed by the company Rs. 3.89 lacs
(previous year Rs.3.89 lacs).
d) Demand for income tax disputed by the company Rs. 21.00 lacs
(previous year Rs. 21.00 lacs).
{ii} Obligations and commitments outstanding
In respect of capital goods imported at the concessional rate of duty
under the Export Promotion Capital Goods Scheme, the company has an
export obligation of approximately Rs. 1 3947 lacs (previous year
26679 lacs), which is required to be met at different dates, before
31.03.2016. In the event of non-fulfillment of the export obligation,
the company will be liable to pay customs duties and penalties, as
applicable. The company is confident of meeting its export obligation.
2. Debtors/Creditors are shown net of advances from/to Customers/
Suppliers and are subject to confirmation.
3. Dues to small-scale industrial undertakings and dues to micro
enterprises and small enterprises
The Company is in the process of compiling relevant information from
its suppliers about their coverage under the Micro, Small and Medium
Enterprises Development Act, 2006. Since the relevant information is
not readily available, no disclosures have been made in the accounts.
However, in view of the management, the impact of interest, if any,
that may be payable in accordance with the provisions of this Act is
not expected to be material.
4. During the year exchange fluctuation gain on export sales included
in the sales is Rs. 480.87 lacs (Previous year loss Rs. 600.32 lacs)
5. a) During the year, premium on prepayment/ resetting of interest
liability on term loans are charged fully as per AS-26. b) During the
year, right issue/ preferential issue expenses are charged fully as per
AS-26.
6. In the opinion of Management, there is no impairment of assets in
accordance with accounting standard (AS-28) as on Balance sheet date.
7. The Company had provided Rs.622 Lacs in the year ended 31st March
2006 as income towards the incentive receivable under the target plus
scheme for the year 2005-06. However, by notification dated 1 2th June
2006, the Govt, reduced the above incentive for the said year from 1 5%
to 5% on incremental exports with retrospective effect from 01.04.2005.
The company has filed writ in the Honble High Court of Rajasthan
challenging the impugned notification of the Govt. Based on the legal
advice received the company is hopeful that the said notification may
be reverted and the company will not be required to revert the pro-rata
incentive.
8. The advances recoverable includes a sum of Rs.18.27 crores of
insurance claim receivable on account of claims lodged on insurance
companies due to fire and other losses suffered of companys various
assets from time to time. The said claims are under active
consideration of the insurance company.
9. interest in Joint Venture Company
The company has the following interest in its Joint Venture Companies:-
I. Keti Sangam Infrastructure (India) Ltd (Country of Incorporation:
India)
The Company is holding 7,80,600 ( Previous Year 4,73,600) equity shares
of Rs.10 each at premium of Rs.90 per equity share [26.02% equity as on
31.03.1 0 (Previous Year 1 5.79%)] in the Joint Venture Company M/s.
Keti Sangam Infrastructure (India) Ltd. for execution of BOT Project at
Aurangabad National Highway. Out of above, 3,39,200 ( Previous Year
3,39,200) equity shares have been pledged as security for the term loan
granted by consortium banks to M/s. Keti Sangam Infrastructure (India)
Ltd. for part financing of the said BOT Project.
II. PKSS Infrastructure Pvt. Ltd. / Kalyan Sangam Infratech Ltd.
(Country of Incorporation: India)
The Company had originally participated in the joint venture for MCD
toll collection project i.e. PKSS Infrastructure Pvt. Ltd. and for BOT
Project at Thane- Bhiwadi i.e. Kalyan Sangam Infratech Ltd. At the time
of sponsoring the above joint venture, the company had planned to make
sizeable investment in the same. However, considering companys
resources the investment has now been restricted to Rs 39,000 in PKSS
Infrastructure Pvt. Ltd. by way of 3,900 ( Previous year 3,900) equity
shares of Rs.10 each [2.48% equity as on 31.03.10 (39.00% equity as on
31.03.09)] and Rs.3.75 lacs in Kalyan Sangam Infratech Ltd. by way of
37,500 ( Previous Year 37,500) equity shares of Rs.10 each [0.79%
equity as on 31.03.10 (37.50% equity as on 31.03.09)]. The company
shall not make any further investment in the above cited joint venture
by way of equity or unsecured loan or otherwise and will dispose/
dilute the investments.
III. The Companys proportionate share in the assets, liabilities,
income and expenses of its Joint Venture Company Keti Sangam
Infrastructure ( India) Ltd is 26.02% (Previous Year 1 5.79%) of the
below total:
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