Mar 31, 2016
[*] Working Capital Loan comprising Cash Credit(CC), Packing Credit in Foreign Currency (PCFC), Export Packing Credit (EPC), Bills discounted and Demand Loan (DL) is repayable on demand from Banks are secured by way of hypothecation of the Companyâs entire current assets including stock of goods, including raw material, work-in-process, finished goods, stores, consumables, spares, goods in transit etc. and book-debts, both present and future, to rank on âpari-passuâ basis. These facilities are also secured by way of first charge over the entire fixed assets including Equitable mortgage over leasehold right over the factory land of the Company situated at Plot No.2, GIDC Estate, Palej, Dist. Bharuch, Gujarat (India) both present and future. Interest for borrowing in Indian Currency through CC, EPC and DL is 10.30% p.a. and for borrowing in foreign currency through PCFC is in the range of Libor 2.6172 % p.a. to Libor 2.6420% p.a.
The secured borrowings are further secured by way of pledge of 3,19,21,366 Equity Shares held by the promoters in favour of the Consortium of Bankers During the year, the Company has drawn the working capital financing facility in excess of sanctioned limits at some times. However, there is no continuous overdrawing of working capital limits as at 31st March, 2016.
From Others [Unsecured] / Inter Corporate Deposits:
Unsecured, short term borrowings received, will be repayable within 90 days from the date of agreement (i.e.29th December, 2015). The applicable interest rate on the loan is 15% p.a. Payable in advance (for 90 days)
1 As on 31st March, 2016, the Company has entered into an âAgreement to Sellâ and handed over possession and transferred the significant risk and ownership of the for part of its leasehold industrial land in favour of the buyer, admeasuring 40470.99 Sq. Mtr. out of it total 247581.81 Sq. Mtr. of leasehold land under 99 years lease from G.I.D.C. situated at Plot No.2, G.I.D.C. Estate, N.H.No.8, Palej, Dist.Bharuch, Gujarat (India) with M/s Steelco Colour Coating Limited at a total consideration of Rs, 1500 lakhs. The Company has received a part payment of Rs, 519 lakhs during the year. The final sale deed and convincing and registration of titles in the favaour of the buyer will be executed after obtaining regulatory approvals & compliance and completion of other regulatory and other formalities. In anticipation of completion of above stated approvals & compliances, the Company has recorded the above stated transaction as sale of land in its books of accounts on the basis of âAgreement to Sellâ and the resultant net profit of Rs, 1488.84 lakhs has been shown under âExtra-ordinary Itemâ in the Statement of Profit & Loss.
2 During financial year 2014-15, the Company has carried out an exercise to undertake technical assessment and evaluation of its fixed assets and has appointed an independent Govt. approved technical value and assessors namely Gujarat Techno - Economic Consultants Pvt. Ltd. The said firm has carried out technical evaluation and assessment of fixed assets and based on their technical review and the practice and policy of continuous refurbishment and maintenance of the equipment and buildings, it has suggested estimated remaining useful life of Buildings and Plant and Machinery for a period which is longer than the period as is specified in Schedule-II to the fixed assets which is as under:
A The Company has worked out deferred tax liabilities / assets as at March 31, 2016. In view of unabsorbed depreciation and business losses under tax laws, net result of computation is net deferred tax assets, which are not recognized as a matter of prudence and in absence of virtual certainty as to its realization.
A Name of the Related Party and Nature of the Related Party Relationship: a Holding Company:
Spica Business Corp., Panama The Holding Company of Spica Investments Limited
Spica Investments Limited, Mauritius Holding Company
b Subsidiary Company:
Steelco Colour Coating Limited Subsidiary Company (up to 31.03.2016)
c Directors and their relatives:
Shri Rashmi Chandaria Non-Executive Director
Shri Vimal Chandaria Non-Executive Director
Shri Mahendra Lodha Non-Executive Independent Director
Shri Jatinder Mehra Non-Executive Independent Director
Dr. R. S. Mamak Non-Executive Vice Chairman (Executive Vice Chairman up to 13.08.2015)
Shri S. S. Ranjan Non-Executive Independent Director
Shri Jiban Goswami Nominee Director
Smt. Ameeta Trehan Non-Executive Independent Director
Shri Mitesh H Shah Managing Director (w.e.f. 14.11.2014)
Smt.Tejal M Shah Wife of Shri Mitesh Shah (Managing Director)
Shri N. M. Mohnot Managing Director (up to 14.08.2014)
Smt.Saroj Mohnot Wife of Shri N.M.Mohnot (Managing Director)
d Key Managerial Persons:
Shri Abhishek Jajoo Chief Financial Officer (w.e.f. 6th November, 2015)
Shri Achal Thakkar Company Secretary (w.e.f. 29th August, 2015)
Shri Sunil Singhvi Chief Finance Officer (up to 23rd October, 2015)
Shri Arvind Tambi Financial Controller & Company Secretary (up to 28th August, 2015)
e Enterprises significantly influenced by Directors and/or their relatives:
Ignis International Industries Pvt. Ltd. (Influence of Shri N. M. Mohnot up to 14.08.2014)
Grip Strapping Technologies Pvt. Ltd. (Influence of relative of Dr. R. S. Mamak)
The Financial Statements of the Company have been prepared on âGoing Concern Basisâ considering the following facts:
1 Promotors have infused funds during the year and have committed to the lenders to further infuse their contribution towards capex plans/meet working capital needs in the forthcoming period;
2 The Company has identified a surplus plot of land and has already initiated process to liquidate the same to raise finance to meet long term requirements after due compliance of attached regulatory & other requirements & approvals;
3 The steel industry is expected to show positive outlook with recent positive policy initiatives taken by the Government;
4 The new management team has been inducted with fresh outlook showing improvement in operational efficiencies
5 Changes implemented in marketing strategies, customer focus and product mix in order to improve margins and profitability.
NOTE: 3
Exceptional item relate to write back of an unclaimed long outstanding dues which is written back during the year as decided by the managements after its review.
Note: 4
Confirmation letters have not been obtained from some of the Trade Receivables, Trade Payables and Loans & Advances. Hence, the balances of these accounts are subject to confirmation, reconciliation and consequent adjustments, if any.
Note: 5
Previous yearâs figures have been regrouped / reclassified wherever necessary to correspond with the current yearâs classifications/ disclosure.
Mar 31, 2014
Contingent liability is disclosed for:
A Possible obligations which will be confirmed by future events not
wholly within the control of the Company, or
B Present obligation arising from past events where it is not probable
that an outflow of resources will be required to settle the obligation
or a reliable estimate of the amount of the obligation cannot be made.
Contingent assets are not recognised in the financial statements since
this may result in the recognition of income that may never be
realized.
B The equity shares rank parri passu and carry equal rights with
respect to voting and dividend.
In the event of liquidation of the Company, the equity shareholders
shall be entitled to proportionate share of their holding in the assets
remained after distribution of all preferential amounts.
C 12.50% Cumulative Redeemable Non-Convertible Preference Shares are
redeemable after a period of 18 years from the date of its issues i.e.
29-09-2008.
The said shares do not carry any voting rights nor do they participate
in the profits of the Company, except that they carry preferential
right in respect of cumulative arrears of unpaid dividend. In the
event of liquidation of the Company, the preference shareholders shall
be entitled to proportionate share of their holding in the assets
remained after distribution of all other preferential amounts but
before distribution to the equity shareholders.
D 7.00 % Cumulative Redeemable Non-Convertible Preference Shares are
redeemable after a period of 15 years from the date of its issues
i.e.21-02-2014.
The said shares do not carry any voting rights nor do they participate
in the profits of the Company, except that they carry preferential
right in respect of cumulative arrears of unpaid dividend. In the
event of liquidation of the Company, the preference shareholders shall
be entitled to proportionate share of their holding in the assets
remained after distribution of all other preferential amounts but
before distribution to the equity shareholders.
A Securities and Terms of Repayment for Secured Long Term Borrowings:
Rupee Term Loans:
Rupee Term Loan of Rs. 4687.99 Lacs is secured by way of joint mortgage
of immovable properties of the company situated at Plot No.2, GIDC
Estate, Palej, Dist. Bahruch, Gujarat (India) both present and future,
and by way of hypothecation of whole of immovable property of the
Company, including plant and machinery and other movables, both present
and future (Save and except inventories and book debts) whether
installed or not, or in the course of transit by way of first charge to
the lenders subject to the first charge on specified movable assets
created in favour of banks providing Working capital finance) to rank
on "pari-passu basis.
The secured borrowings are further secured by way of pledge of
3,33,08,398 Equity Shares held by the promoters in favour of the
Consortium of Bankers and corporate guarantee of Spica Business Corp.,
Panama, the holding company of Spica Investments Ltd.,Mauritius.
The loans are rescheduled in terms of Corporate Debts Restructuring
Scheme as is appoved by the Corporate Debt Restructuring Cell vide its
apporval letter dtd June 27, 2012. Accordingly the loans are now
repayable in stepped-up quarterly 30 instalments commencing from
December 2013 as detailed hereunder.
B Default in repayment of monthly Interest and Term Loan Instalments:
During the year the company has made delays in payment of interest on
long term borrowings in the range of 1 to 60 days. Interest accrued &
due as at 31st March 2014 has been paid subsequent to the date of
financial statement. During the year the company has made delays in
repayment of principal value of long term borrowings in the range of 2
to 64 days. Moreover, the company has not paid instalment of Rs.
30,53,876/- which was due on 31 - 03-2014 till the date of financial
statement which have been paid subsequent to the date of financial
statement.
C Terms of Repayment for Unsecured Long Term Borrowings:
Finance obligations of Rs. 52.07 Lacs is taken against Hypothecation of
respective vehicles and it is repayable as per the repayment schedule
ranging 36 to 48 equal monthly instalments alongwith interest for the
year. The outstanding amount as at 31st March 2014 is Rs. 16.00 Lacs.
[As at 31-03-2013: Rs. 30.01 Lacs]. There is no default by the company
in repayment of such loan during the year.
Disclosure pursuant to Accounting Standard-15 [Revised] "Employee
Benefits" : Defined benefit plan and long term employment benefit
A General description:
Gratuity [Defined benefit plan]:
The Company has a defined benefit gratuity plan. Every employee who has
completed continuous services of five years or more, gets a gratuity on
death or resignation or retirement at 15 days salary [last drawn
salary] for each completed year of service. The gratuity scheme is
administered by the company, being unfunded liability.
Leave wages [Long term employment benefit]:
The employees of the company are entitled to leave as per the leave
policy of the company. The liability on account of accumulated leave as
on last day of the accounting year is recognised at present value of
the defined obligation at the balance sheet date based on the actuarial
valuation carried out by an independent actuary using projected unit
credit method. The Leave encashment obligation is administered by the
company, being unfunded liability.
[*] Working Loan comprising Cash Credit(CC), Packing Credit Foreign
Currency(PCFC), Export Packing Credit (EPC), Bills discounted and
Demand Loan (DL) is repayable on demand from Banks, are secured by way
of hypothecation of the Company''s entire current assets including stock
of goods, including raw material, work-in-process, finished goods,
stores, consumables, spares, goods in transit etc.and book-debts,both
present and future, to rank on "pari-passu" basis. These facilities are
also secured by way of first charge over the entire fixed assets
including Equitable mortgate over leasehold right over the factory land
of the Company situated at Plot No.2, GIDC estate, Palej, Dist.
Bharuch, Gujarat (India) both present and future. Interest for
borrowing in Indian Currency through CC, EPC and DL is is 11% p.a. and
for borrowing in foreign currency through PCFC is in the range of Libor
2.25% p.a. to Libor 2.50% p.a.
The secured borrowings are further secured by way of pledge of
3,33,08,398 Equity Shares held by the promoters in favour of the
Consortium of Bankers.
During the year the company has drawn the working capital financing
facility in excess of sanctioned limits. As at March 31, 2014, total
overdrawn amount is Rs. 1110.68 lacs, which have been paid subsequent
to the date of financial statement.
Notes:
1 The major items of fixed assets comprising of Leasehold Land,
Buildings and Plant and machineries owned by the Company were revalued
by M/s Mott MacDonald Private Limited, an independent professional
technical experts and valuers as at 31st March, 2011. As per their
report, the above assets with a written down value of Rs. 5740.30 lacs
have been revalued at 15020.48 lacs resulting into surplus of Rs.
9280.18 lacs,which is credited to "Revaluation Reserve Account." Such
assets are revalued considering:- Current prevailing market
prices/derived rates attributable to land;
Current cost of construction;
Present day cost of equivalent new plant and machinery installed and
ready for production;
Estimated useful life of fixed assets and related degree of
obsolescence; Depreciation thereon since acquisition at an appropriate
rates following Straight Line Method.
DEFERRED TAX:
A The Company has worked out deferred tax liabilities / assets as at
March 31, 2014. In view of unabsorbed depreciation and business losses
under tax laws, net result of computation is net deferred tax assets,
which are not recognised as a matter of prudence and in absence of
virtual certainty as to its realization.
B Break up of Deferred Tax Liabilities and Assets into major components
of the respective balances are as under :
Hitherto, the company has been working out the cost of Raw Materials on
annual moving average basis.
During the current year, the Company has changed the basis of arriving
at cost from the "annual moving average cost" to the "quarterly moving
average cost". Had the company followed the same basis during the year
to arrive cost of Raw Materials, the closing stocks (i.e. Raw
Materials, Work-In-Process and Finished Goods) would have been lower by
Rs. 195.39 Lacs and the loss before tax for the year would have been
higher by Rs. 195.39 Lacs.
c Central Board of excise & custom ("CBEC") vide its office memorandum
dated 22nd February 2011 has clarified that where the cenvat credit is
availed in respect of goods exported under the duty free import
authorisation("DFIA"). such credit even if the said credit without
being utilised is reversed or paid back alongwith interest after the
goods are cleared for export, it will be treated as if such credit is
availed by the assessee. Being agrieved by issue of such memorandum in
respect of benefits claimed by the company on DFIA, the company has
filed a writ petition Mumbai High Court challenging the memorandum
issued by CBEC, which is decided in favour the company, based on the
facts of the case and prevalent legal position and Foreign Trade
Policy.
However, central excise department has filed special leave petition in
the supreme court challenging the above decision of the Bombay High
Court, which has been admitted by Hon''ble Supreme Court. The Company
has been advised by its legal advisors that the stand of the excise
deptatment is not tenable, hence there would not be any financial
liabilities arising on the Company.
[*] Rent Expenses: The Company has taken various residential/office
premises/godowns under operating lease or leave and license agreement.
The lease terms in respect of such premises are on the basis of
individual agreement entered into with the respective landlords. The
Company has given refundable interest free security deposits in
accordance with the agreed terms. The lease payments are recognised in
the statement of Profit and Loss.
Operating leases are mainly in the nature of lease of office premises
with no restrictions and are renewable/ can be cancelled at the option
of either of the parties. There is no escalation clause in the lease
agreement. There are no sub-leases. Lease payment recognised in the
statement of Profit and Loss is Rs. 8.43 lacs [Previous Year- Rs. 6.88
lacs]
[**] The Company has approached the Central Government and has filed an
application for approval of remuneration payable to Non- Executive
Independent Directors of the Company which is pending approval.
However, in anticipation of obtaining such approval, remuneration for
the current Year amounting to Rs. 2,00,000/- is provided for in the
accounts.
SEGMENT INFORMATION:
As the Company has identified manufacture of steel products as its sole
primary business segment, the disclosure requirements of Accounting
Standard 17 - "Segment Reporting", issued by the Institute of Chartered
Accountants of India are not applicable.
GOING CONCERN ASSUMPTION
The Networth of the company has substantialy been eroded and the
current liabilities are more than current assets as at the date of
financial statements. However the financial statement have been
prepared on a "Going Concern" basis. The company has been able to
manage its operational cash flows and manufacturing/production
activities during the year. Moreover, during the financial year 2012-
2013, the company got the approval for Corporate Debt Restructuring
Scheme ("CDR") from Corporate Debt Restructuring cell vide its approval
letter dated June 27, 2012. The promoters have also infused additional
funds as per the CDR scheme. As per the short term business plan, the
management has projected positive cash flows so as to operate and
manage normal production levels and fund requirements and operations of
the Company without incurring additional capital costs. The ability of
the company to continue as a "Going Concern" is dependent upon
improvement in industrial and market scenario and achieve the projected
profitability.
Confirmation letters have not been obtained from some of the Debtors,
Creditors, and Loans & Advances. Hence the, balances of these accounts
are subject to confirmation, reconciliation and consequent adjustments,
if any.
Previous year''s figures have been regrouped / reclassified wherever
necessary to correspond with the current year''s classifications/
disclosure.
Mar 31, 2013
The Company has entered into a supply agreement with supplier of Zinc
during the period from 1st April, 2013 to 31st March, 2014 under which
it is under obligation to purchase minimum 3000 MT of Zinc during the
said period with a minimum quarterly commitment of 750 MT. In case of
any shortfall, the favourable pricing treatment would not be available
to the Company for such shortfall quantity, the amount of which is not
ascertainable.
NOTE: 1-SEGMENT INFORMATION:
As the Company has identified manufacture of steel products as its sole
primary business segment, the disclosure requirements of Accounting
Standard 17 Â "Segment Reporting", issued by the Institute of Chartered
Accountants of In dia are not applicable.
NOTE: 2-RELATED PARTY TRANSACTIONS:
A Name of the Related Party and Nature of the Related Party
Relationship: a Holding Company:
Spica Business Corp., Panama Holding Company of Spica Investments
Limited
Spica Investments Limited, Mauritius Holding Company
b Directors and their relatives:
Mr. R. P. Chandaria Non-Executive Director
Mr. Rashmi Chandaria Non-Executive Director
Mr. P. G. R. Prasad Non-Executive Independent Director (upto
16.11.2012)
Mr. Mahendra Lodha Non-Executive Independent Director
Mr. Jatinder Mehra Non-Executive Independent Director
Dr. R. S. Mamak Non Executive Vice Chairman (Executive Vice Chairman
upto 31.01.2013)
Mr. N. M. Mohnot Managing Director
Mrs. Saroj Mohnot Wife of Managing Director
c Enterprises significantly influenced by Directors and/or their
relatives:
Amfin Finser (India) LLP Disha Infin Advisor Pvt. Ltd. Ignis
International Pvt. Ltd.
NOTE: 3
The financial statements have been prepared on the basis that the
Company is a going concern and that no adjustments are required to the
carrying value of assets and liabilities though the Company has
incurred substantial losses and its net worth has been eroded in view
of the fact and having regard to execution of the Master Restructuring
Agreement with consortium of lenders and approval of Corporate Debt
Restructuring Scheme ("CDR") by Corporate Debt Restructuring Cell vide
its approval letter dtd. June 27, 2012, infusion of additional funds by
the promoters, improved operating performance and measures taken by the
management to sustain the same etc.,
NOTE: 4
Confirmation letters have not been obtained from some of the Debtors,
Creditors and Loans & Advances. Hence the, balances of these accounts
are subject to confirmation, reconciliation and consequent adjustments,
if any.
NOTE: 5
Previous years'' figures have been regrouped / reclassified wherever
necessary to correspond with th e current years'' classifications/
disclosure.
Mar 31, 2012
A The equity shares rank parri passu and carry equal rights with
respect to voting and dividend.
In the event of liquidation of the Company, the equity shareholders
shall be entitled to proportionate share of their holding in the assets
remained after distribution of all preferential amounts.
B The Preferenpe Shares are redeemable after a period of 15 years from
the date of its issue i.e. 29-09-2008. The preference share holders
have right to exercise option to convert such shares into equity shares
in the Company on the offer made by the Board of Directors of the
Company. The said shares do not carry any voting rights nor are they
participative in the profits of the Company except that they carry
preferential right in respect of cumulative arrears of unpaid dividend.
In the event of liquidation of the Company, the preference shareholders
shall be entitled to proportionate share of their holding in the assets
' remained after distribution of all other preferential amounts but
before distribution to the equity shareholders
A Securities andTerms of Repayment for Secured Long Term Borrowings: .
RupeeTerm Loans:
Rupee Term Loan ofRs. 430 Lacs is secured by way of joint mortgage of
immovable properties of trie company situated at PlotNo.2, GIDC Estate,
Palej, Dist. Bharuch, Gujarat (India; co;h present and future, arid by
way .of hypothecation of whole of immovable property of the company,
including plant and machinery and other movables, both present and
future (Save and except inventories and book debts whether installed or
not, or in the course of transit by Way of first charge to the lenders
subject to the first charge on specified movable assets created in
favour of banks providing Working capital finance) to lank on "pari -
passu': basis.
The Loan is repayable in 20 quarterly instalments of Rs. 90 lacs after a
moratorium period of six months from the year of its origination
2008-09 alongwith interest fcr the period.The interest rates are reset
based upon SBI base rate revised from time to time.The outstanding
amount of loan as at 31st March 2012 is Rs. 430 Lacs [As at 31-03-2011: Rs.
792.50 Lacs]
B Terms of Repayment for Unsecured LongTerm Borrowings:
Finance obligations of Rs. 55.23 Lacs is taken against Hypothecation of
respective vehicles and it is repayable as per the repayment schedule
ranging 36 to 60 equal monthly instalments alongwith interest for the
period. The outstanding amount as at 31st March 2012 is Rs. 43.20 Lacs.
[As at 31-03-2011: X 12.65 Lacs],
A General description:
Gratuity [Defined benefit plan]:
The Company has a defined benefit gratuity plan. Every employee who has
completed continuous services of five years or more, gets a gratuity on
death or resignation or retirement at 15 days salary [last drawn
salary] for each completed year of service. The gratuity scheme is
administered by the company, being unfunded liability.
Leave wages [Long term employment benefit]:
The employees of the company are entitled to leave as per the leave
policy of the company. The liability on account of accumulated leave as
on last day of the accounting year is recognised at present value of
the defined obligation at the balance sheet date based on the actuarial
valuation carried out by an independent actuary using projected unit
credit method. The Leave encashment obligation is administered by the
company, being unfunded liability. -
Notes:
1 The major items of fixed assets comprising of Leasehold Land,
Buildings and Plant and mac! lineries owned by the Company were
revalued by M/s Mott MacDonald Private Limited, an independent
professional tf.',nical expds and valuers as at 31st March, 2011. As
per their report, the above assets with a written down value of Rs.
5740.30 lacs have been revalued at Rs. 15C20.48 lacs resulting into
surplus of Rs. 9280.18 lacs, which is credited to "Revaluation Reserve
Account." Such asset- are revalued considering: -
Current prevailing market prices/derived rates attributable to land;
Current cost of construction;
Present day cost of equivalent new plant and machinery installed and
ready for production:
Estimated useful life of fixed assets and related degree of
obsolescence; Depreciation there**' since arquisiuon at an appropriate
rates following Straight Line Method .
NOTE: 1-DEFERRED TAX:
A The Company has worked out deferred tax liabilities / assets as at
March 31, 2012. In view of unabsorbed depreciation and business losses
under tax laws, net result of computation is net deferred tax assets,
which are not recognised as a matter of prudence and in absence of
virtual certainty as to its realization.
NOTE: 2-CONTINGENT LIABILITIES AND COMMITMENT [TO THE EXTENT NOT
PROVIDED FOR]:
A Contingent Liabilities:
a In respect of guarantees given
by Banks and/or counter guarantees
given by the Company 152.36 120.87
b Other money for which the company
is contingent liable: .
i In respect of the demands raised
by the Central Excise & Service Tax
Authority 400.87 437.98
ii In respect of Income Tax matters
pending before appellate
authorities which the 249.15 235.70
Company expects to succeed, based
on decisions of Tribunals/Courts.
iii Letters of Credit 505.42 355.51
iv Dividend on Cumulative Preference Shares1,437.56 1,027.31
v Interest on Electricity
Duty Deferment Loan 83.18 83.18
vi Labour Matters 50.00 45.00
vii Total 2,878.54 2,305.55
B Commitments:
a Estimated amount of contracts remaining to be executed on capital
account and not 20.57 3.31
provided for [ Net of Advances ] b Commitments under Wage Settlement
agreement with the workers of the Company 52.48 -Total 73.05 3.31
The Company has entered into a supply agreement with supplier of Zinc
during the period '
from 1st April, 2012 to 31st March, 2013 under which it is under
obligation to purchase minimum 3000 MT of Zinc during the said period
with a minimum monthly commitment of 250 MT. In case of any shortfall,
the favourable pricing treatment would not be available to the Company
for such shortfall quantity, the amount of which is not ascertainable.
[*] Rent Expenses:
The Company has taken various residential/office premises/godowns under
operating lease or leave and license agreement. The lease terms in
respect of such premises are on the basis of individual agreement
entered into with the respective landlords. The Company has given
refundable interest free security deposits in accordance with the
agreed terms. The lease payments are recognised in the statement of
Profit and Loss.
Operating leases are mainly in the nature of lease of office premises
with no restrictions and are renewable/ cancellable at the option of
either of the parties. There is no escalation clause in the lease
agreement. There are no sub-leases. Lease payment recognised in the
statement of Profit and Loss is Rs. 8.81 lacs [Previous reporting period-
Rs. 9.66 lacs]
[**] Miscellaneous Expenses include Payment to the auditors as
[Excluding Service Tax]:
NOTE: 4-SEGMENT INFORMATION:
As the Company has identified manufacture of steel products as its sole
primary business segment, the disclosure requirements of Accounting
Standard 17- "Segment Reporting", issued by the Institute of
Chartered Accountants of India are not applicable.
NOTE: 5
The Company has incurred substantial losses and its net worth has been
eroded substantially. Company has also incurred substantial cash loss
during the current reporting period. However, having regard to the
master debt recast agreement under negotiation and advanced stage under
Corporate Debt Restructuring Scheme ("CDR"), infusion of additional
funds etc., the financial statements have been prepared on the basis
that the Company is a going concern and that no adjustments are
required to the carrying value of assets and liabilities. However, the
appropriateness of assumption of going concern is dependent upon the
approval of CDH and company's ability to raise requisite finance or
generate cash flows in future to meet its future revival plans and for
continuing operations.
NOTE: 6
Confirmation letters have not been obtained from some of the Debtors,
Creditors, and Loans & Advances. Hence, the balances of these accounts
are subject to confirmation, reconciliation and consequent adjustments,
if any.
NOTE: 7
The Revised Schedule VI has become effective from April 1,2011 for the
preparation of financial statements. This has significantly impacted
the disclosure and presentation made in the financial statements.
Previous PeriodÃs figures have been regrouped/ reclassified wherever
necessary to correspond with the current periodÃs classifications/
disclosure.
Mar 31, 2011
1. The major items of fixed assets comprising of Leasehold Land,
Buildings and Plant and machineries owned by the Company were revalued
by M/s Mott MacDonald Private Limited, an independent professional
technical experts and valuers as at 31st March, 2011. As per their
report, the above assets with a written down value of Rs. 5740.30 lacs
have been revalued at Rs. 15020.48 lacs resulting into revaluation
surplus of Rs.9280.18 lacs, which is credited to "Revaluation Reserve
Account." Such assets are revalued considering: -
- Current prevailing market prices/derived rates attributable to land;
- Current cost of construction;
- Present day cost of equivalent new plant and machinery installed and
ready for production;
- Estimated useful life of fixed assets and related degree of
obsolescence;
- Depreciation thereon since acquisition at an appropriate rate
following Straight Line Method.
2.. The Company has approached the Central Government and has filed an
application for approval of remuneration payable to Non-Executive
Independent Directors of the Company which is pending approval.
However, in anticipation of obtaining such approval, remuneration for
the financial year amounting to Rs. 7,50,000/- is provided for in the
accounts.
3. Estimated amount of Contracts yet to be executed for capital
expenditure and not provided for is Rs. 3.31 Lacs [Net of Advances] [As
at 31.03.2010 - Rs. 47.83 Lacs].
4. During the year, the company has capitalised the borrowing cost
amounting to Rs. Nil (Previous Year Rs. 70.15) Lacs.
5. Contingent Liabilities not provided for in respect of:
(Rs. in Lacs)
Current Previous
Year Year
I Guarantees given by the Company's
Bankers 120.87 82.90
II Letters of Credit opened, material
not supplied 355.51 175.31
III Dividend on Cumulative Preference
shares 1027.31 617.06
IV Liabilities Disputed and appeals
filed before higher Appellate
authorities as well as in the
process of being filed in respect
of:
i. Income tax matters 235.70 328.53
ii. Central Excise matters
(entire amount withheld by department
shown under "Loans and advances") 437.98 370.50
iii.Interest on Electricity Duty
Deferment Loan 83.18 83.18
iv. Labour matters 45.00 45.00
6. SEGMENT INFORMATION:
PRIMARY BUSINESS SEGMENT
As the Company has identified manufacture of steel products as its sole
primary business segment, the disclosure requirements of Accounting
Standard 17 - "Segment Reporting", issued by the Institute of Chartered
Accountants of India are not applicable.
7. RELATED PARTY DISCLOSURE:
Name of the related party and nature of related party relationship:
(a) Enterprises having control over Company:
SpicaI investment Limited - Holding Company
(b) Directors and their relatives:
Mr. R. P. Chandaria Non-Executive Director
Mr. Rashmi Chandaria Non-Executive Director
Mr. S. C. Sheth (ceasod due to
sad demise on 26.12.10) Non-Executive Independent
Director
Mr. P. G. R. Prasad Non-Executive Independent
Director
Mr. Mahendra Lodha Non-Executive Independent
Director
Mr. J. Mehra Non-Executive Independent
Director
Dr. R. S. Mamak Executive Vice Chairman
Mr. N. M. Mohnot Deputy Managing Director
8. ACCOUNTING FOR TAXES ON INCOME:
a. In view of the brought forward unabsorbed depreciation allowance,
the Company does not expect any tax liability on tho income computed as
per the provision of the Income Tax Act, 1961. However, in view of the
provisions of the Sec. 115JB of the Income Tax Act, 1961, the company
has estimated & provided the tax liability on the book profits as
computed under the provision of the Sec. 115JB of the Income Tax Act,
1961.
b. The Company has worked out deferred tax liabilities / assets as at
March 31, 2011. In view of unabsorbed depreciation and business losses
under tax laws, net result of computation is net deferred tax assets,
which are not recognised as a matter of prudence.
9. Disclosure pursuant to Accounting Standard-15 (Revised) "Employee
Benefits":-
The disclosure required under Accoutring Standard 15 (Revised)
"Employee Benefits" notified in the Companies (Accounting Standards)
Rules 2006, are given below:-
(a) Gratuity (Defined Benefit Plan):
The company has a defined benefit Gratuity Plan. Every employee who has
completed five years or more of service gets a gratuity on death or
resignation or retirement at 15 days salary (last drawn salary) for
each completed year of service. The gratuity scheme is administered by
the company, being unfunded liability.
Leave Wage (Long term employment benefit):
The leave wages are payable to all eligible employees at the rate of
daily salary for each day of accumulated leave on death or on
resignation or upon retirement on attaining superannuation age.
10. Confirmation letters have not been obtained from some of the
Debtors, Creditors, and Loans & Advances. Hence the, balances of these
accounts are subject to confirmation, reconciliation and consequent
adjustments, if any.
11. Figures of Previous year have been regrouped and reclassified
wherever necessary.
Mar 31, 2010
1. Estimated amount of Contracts yet to be executed for capital
expenditure and not provided for is Rs. 47.83 Lacs [Net of Advances] [As
at 31.03.2009 - Rs. 24.15 Lacs].
2. During the year, the company has capitalised the borrowing cost
amounting toRs. 70.15 (Previous Year Rs.9.11 Lacs).
3. Contingent Liabilities not provided for in respect of:
(Rs. in Lacs)
Current Year Previous Year
I Guarantees given by the Companys Bankers 82.90 156.45
II Letters of Credit opened, material
not supplied 175.31 308.86
III Dividend on Cumulative
Preference shares 617.06 206.81
IV Liabilities Disputed and appeals filed
before higher appellate authorities
as well as in the process of being filed in respect of:
a. Income tax matters 328.53 392.20
b. Central Excise matters (entire amount
withheld by department shown under "Loans
and advances") 370.50 370.50
c. Interest on Electricity Duty
Deferment Loan 83.18 83.18
d. Labour matters 45.00 45.00
4. SEGMENT INFORMATION:
PRIMARY BUSINESS SEGMENT
As the company has identified manufacture of steel products as its sole
primary business segment, the disclosure requirements of Accounting
Standard 17 - "Segment Reporting", issued by The Institute of Chartered
Accountants of India are not applicable.
5. RELATED PARTY DISCLOSURE:
Name of the related party and nature ot related party relationship:
(a) Enterprises having control over Company:
Spica Investment Limited - Holding Company
(b) Directors and their relatives:
Mr. R. P. Chandaria
Mr. Rashmi Chandaria
Mr. S.C.Sheth
Mr. Mahendra Lodha
Mr. J. Mehra
Dr. R. S. Mamak Executive Vice Chairman
Mr. N. M. Mohnot Deputy Managing Director
Mr. M. P. Singh Director (Operations) (resigned w.e.f. 24th June, 2009)
Mr. P. G. R. Prasad Additional Director (appointed w.e.f. 23rd
February, 2010)
6. ACCOUNTING FOR TAXES ON INCOME:
a. In view of the brought forward-unabsorbed business losses &
depreciation allowance, the company does not expect any tax liability
on the income computed as per the provision of the Income Tax Act,
1961. However, in view of the provisions of the Sec. 115JB of the
Income Tax Act, 1961, the company has estimated & provided the tax
liability on the book profits as computed under the provision of the
Sec. 115JBofthe Income Tax Act, 1961.
b. The company has worked out deferred tax liabilities / assets as at
March 31,2010. in view of unabsorbed depreciation and business losses
under tax laws, net result of computation is net deferred tax assets,
which are not recognised as a matter of prudence.
7. Disclosure pursuant to Accounting Standard-15 (Revised) "Employee
Benefits":-
The disclosure required under Accounting Standard 15 (Revised)
"Employee Benefits" notified in the Companies (Accounting Standards)
Rules 2006, are given below:-
(a) Gratuity (Defined Benefit Plan):
The company has a defined benefit Gratuity Plan. Every employee who has
completed five years or more of service gets a gratuity on death or
resignation or retirement at 15 days salary (last drawn salary) for
each completed year of service. The gratuity scheme is administered by
the company being unfunded liability.
Leave Wage (Long term employment benefit):
The leave wages are payable to all eligible employees at the rate of
daily salary for each day of accumulated leave on death or on
resignation or upon retirement on attaining superannuation age.
8. Confirmation letters have not been obtained from some ot the
Debtors, Creditors, and Loans & Advances. Hence the, balances of these
accounts are subject to confirmation, reconciliation and consequent
adjustments, if any.
9. Disclosure regarding MSME:-
The company has not received information from vendors regarding their
status under the Micro, Small and Medium Enterprises Development Act,
2006, and hence, disclosure relating to the amounts unpaid as at the
year end together with interest paid/ payable under this Act has not
been given.
10. Figures of Previous Year have been regrouped and reclassified
wherever necessary.
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