Notes to Accounts of Super Tex Industries Ltd.

Mar 31, 2015

1. Corporate Information:

The Company was formed in 1986 and manufactures draw warped and sized yarn beams of polyester and nylon. It also manufactures textured and twisted yarns of polyester and nylon. The Company also exports these yarns and trades in textiles fabrics.

2. Related Party Disclosures

As per Accounting Standard 18, the disclosures of transactions with related parties (with whom transaction exist) are given below:

i Related Party relationships :

a Where control exists

Super Infincon P. Ltd Super Polyester Yarns Ltd.

b Key Management Personnel

G D Mishra R K Mishra S K Mishra

c Relatives of Key Management Personnel

G D Mishra A R Mishra R S Dhandh S B Sharma R S Mishra

H V Mishra R A Sharma S D Mishra U K Sharma

As At As At 31st March, 31st March, 2015 Rupees 2014 Rupees in Lacs in Lacs

3. Contingent Liabilities and Commitments

I Contingent Liabilities

A Claims against the Company/disputed liabilities not acknowledged as debt nor provided for :

i Excise duty appeal before the Gujarat 792.11 792.11 High Court*

ii Excise appeal before the Appellate 67.32 67.32 Tribunal,WZB, Ahmedabad

Total 859.43 859.43

* Excise duty of Rs 792.11 lacs (Previous Year Rs 792.11 lacs), relating to certain sales made from 4/7/1995 to 22/10/1996, was demanded by the Commissionerate, Daman, alongwith equal penalty, interest thereon and a fine of Rs 21 lacs (Previous Year Rs 21 lacs). The Company appealed against the said order with CESTAT, Ahmedabad. The CESTAT has decided in favour of the Company. The Excise department has appealed before the Gujarat High Court.

II Commitments

i Estimated amount of contracts remain to be executed on capital account and not provided 0.00 0.00 for

ii No provision for Minimum Alternate Tax(MAT) under section 115JB of the Income Tax Act, 1961 has been made in view of legal opinion received by the Company.

4. The Sales Tax assessments at Silvassa and Dharampur are completed upto F.Y. 2011-12 and F.Y. 2010-11 respectively. The income tax assessment of the Company is completed upto A.Y.2011-12.

5. Previous Year's figures have been re-grouped/re-arranged wherever necessary.

---

Mar 31, 2014

1 Corporate Information :

The Company was formed in 1986 and manufactures draw warped and sized yarn beams of polyester and nylon. It also manufactures textured and twisted yarns of polyester and nylon. The Company also exports these yarns and trades in textiles fabrics.

2. 15,00,000 Shares of Rs. 10/- each out of the Issued, Subscribed and Paid-up Share Capital were alloted in the last five years pursuant to exercise of warrants.

3. Buildings include cost of 15 shares of Rs. 50/- each in Balkrishna Krupa Co-operative Hsg. Soc. Ltd.

3.1 $ includes Office Equipments

4. General description of Lease terms:

(a) Lease rentals are charged on the basis of agreed terms

(b) Assets are taken on lease over a period of 3 to 5 years

5. Defined Benefit Plan :

Group Gratuity Scheme of LIC of India

Assumptions used for Acturial valuation (Gratuity) : Discount Rate : 8%, Salary Escalation Rate : 5%, Rol on PA : 7.28% Assumption used for Acturial valuation (Leave) : Discount Rate : 8%, Salary Escalation Rate : 5%, RetirementAge : 65 Yrs, Withdrawal Rates 1% p.a., Mortality Table (LIC1994-96) Ultimate, Projected Unit Credit Method

As At As At 31st March, 2014 31st March, 2013 Rupees in Lacs Rupees in Lacs

6. Contingent Liabilities and Commitments

I Contingent Liabilities

A Claims against the Company/ disputed liabilities not acknowledged as debt nor provided for :

i) Excise duty appeal before the Gujarat High Court* 792.11 792.11

Total 792.11 996.04

*Excise duty of Rs. 792.11 lacs (Previous Year Rs. 792.11 lacs), relating to certain sales made from 4/7/1995 to 22/10/1996, was demanded by the Commissionerate, Daman, alongwith equal penalty, interest thereon and a fine of Rs. 21 lacs (Previous Year Rs. 21 lacs). The Company appealed against the said order with CESTAT, Ahmedabad. The CESTAT has decided in favour of the Company. The Excise department has appealed before the Gujarat High Court.

II Commitments

i) Estimated amount of contracts remaining to be executed on capital account and not provided for 0.00 12.00

ii) No provision for Minimum Alternate Tax(MAT) under section 115JB of the Income Tax Act, 1961 has been made in view of legal opinion received by the Company.

7. The Sales Tax assessments at Silvassa and Dharampur are completed upto F.Y. 20011-12 and F.Y. 2009-10. The income tax assessments of the Company are completed upto A.Y.2011-12.

8. Previous Year''s figures have been re-grouped/re-arranged wherever necessary.

---

Mar 31, 2013

1. Corporate Information :

The Company was formed in 1986 and manufactures draw warped and sized yarn beams of polyester and nylon. It also manufactures textured and twisted yarns of polyester and nylon. The Company also exports these yarns and trades in textile fabrics.

1.1 The Share warrants convertible into equity shares within 18 months from 23/11/2010 got lapsed due to non-exercise of right by the allotees by 23/05/2012. The application money received thereon Rs. 531.00 lacs has been transferred to Capital Reserve.

---

Mar 31, 2012

1.1 15,00,000 Shares of Rs. 10/- each out of the Issued, Subscribed and Paid-up Share Capital were alloted in the last five years pursuant to exercise of warrants.

2.1 The Company had allotted 9 crore equity share warrants on 23/11/2010. These share warrants were convertible into equal number of equity shares at the option of the holder within 18 months from the date of allotment. As per SEBI (ICDR) Regulations, the Company had received upfront money towards consideration from the allottees. Since the holders of the warrants did not exercise their right to convert their warrants into equity shares by the last date of exercise of such right which was 23/05/2012, the share warrants issued got lapsed. The Company will take the necessary steps in this regard in the ensuing year.

3.1 Buildings include cost of 30 shares of Rs. 50/- each in Balkrishna Krupa Co-operative Hsg. Soc.Ltd

3.2 Additions to Buildings include reversal of excess write-off during 2010-11

3.3 $ includes Office Equipments

3.4.1 In respect of Fixed Assets acquired on finance lease on or after 1st April, 2001, the minimum lease rentals outstanding as on 31st March, 2012 are as follows :

3.4.2 General description of Lease terms:

(a) Lease rentals are charged on the basis of agreed terms

(b) Assets are taken on lease over a period of 3 to 5 years

Assumptions used for Actuarial valuation (Gratuity) : Discount Rate : 8%, Salary Escalation Rate : 4%, Assumption used for Actuarial valuation (Leave) : Discount Rate : 8%, Salary Escalation Rate : 5%, Retirement Age : 65 Yrs, Withdrawal Rates 1% p.a., Mortality Table (LIC1994-96) Ultimate, Projected Unit Credit Method

4 Related Party Disclosures

As per Accounting Standard 18, the disclosures of transactions with related parties are given below:

i Related Party relationships :

a Where control exists Super Infincon P. Ltd Super Polyester Yarns Ltd.

b Key Management Personnel

S S Mishra R K Mishra

S K Mishra

c Relatives of Key Management Personnel

B K Sharma

S B Sharma A B Sharma R S Dhandh

5 Contingent Liabilities and Commitments I Contingent Liabilities

A Claims against the Company/disputed liabilities not acknowledged as debt nor provided for :

i) Claims by the Sales tax department in respect of earlier years. appealed by the Company - 2,18,36,704

Less : Paid/provided for out of the above - 14,43,911

Total - 2,03,92,793

ii) Excise duty of Rs. 792.11 lacs (Previous Year Rs. 792.11 lacs), relating to certain sales made from 4/7/1995 to 22/10/1996, was demanded by the Commissionerate, Daman, alongwith equal penalty, interest thereon and a fine of Rs. 21 lacs (Previous Year Rs. 21 lacs). The Company appealed against the said order with CESTAT, Ahmedabad. The CESTAT has decided in favour of the Company. The Excise department has appealed before the Gujarat High Court.

ii) No provision for Minimum Alternate Tax(MAT) under section 115JB of the Income Tax Act, 1961 has been made in view of legal opinion received by the Company.

6 Segment Reporting

As the Company deals in only one segment i.e."Textiles", there are no reportable business segments. There are also no reportable geographical segments.

7 The Sales Tax assessment at Silvassa is completed upto F.Y 2004-05 and at Dharampur upto F.Y. 2008-09. The income tax assessment of the Company is completed upto A.Y.2010-11.

8 Previous Year's figures have been re-grouped/re-arranged wherever necessary.

---

Mar 31, 2011

Contingent liabilities :

(a) Guarantees given by bank Rs Nil (Previous Year Rs Nil)

(b) Claims against the Company not acknowledged as debt nor provided for:

31.03.2011 31.03.2010 Rs.Lacs Rs. Lacs

i. Claims raised by the Sales Tax department in respect of earlier years disputed by the Company and appealed against 218.36 167.72

Less : Paid/(Provided)for out of the above 14.43 11.28

Total 203.93 156.44

Note : Excise duty of Rs 792.11 lacs, relating to certain sales made, from 4.07.1995 to 22.10.1996, was demanded by the Commissionerate, Daman, alongwith equal penalty, interest thereon and a fine of Rs 21 lacs. The Company appealed against the said order with CESTAT, Ahmedabad. The CESTAT had decided in favour of the Company. The Excise department has appealed before the High Court.

(c) Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. 683.82 lacs (Previous Year Rs. Nil).

(d) No provision for Minimum Alternate Tax (MAT) under the Income tax Act, 1961, has been made in view of the legal opinion received by the Company.

2. Disclosures pursuant to Accounting Standard-15 "Employee Benefits" :

3. The Sales tax assessment at Silvassa and Dharampur is completed upto F.Y. 2004-05 and 2006-07 respectively. The Income tax assessment of the Company is completed upto A.Y. 2008-09.

4. The Company is not required to obtain any licence under the Industrial Development and Regulations Act. Therefore the details of licenced capacity are not applicable. The installed capacity could not be worked out due to complexity of different deniers used. However, the Company has registered itself with the Textile Commissioner as a medium scale unit for Texturising, Twisting and Doubling of Art Silk yarns at Silvassa. The Company is also registered with the Secretariat of Industrial Approvals for its unit at Dharampur.

5. The Company is no longer a sick industrial company within the meaning of section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985. It was discharged from the purview of the Act vide order dated 18/06/2010.

6. The Company has issued 900 lacs equity share warrants of Rs 2,124 lacs @ Rs 2.36 per warrant on preferential basis to be converted into equity shares of Re 1/- each at a premium of Rs 1.36 per share within 18 months from the date of allotment. Rs 531.00 lacs has been paid up on the warrants.

7. Previous Year's figures have been regrouped/rearranged wherever necessary. Figures in brackets relate to the previous year.

8. Loans and advances include housing loan of Rs 1.11 lacs (Previous Year Rs 2.78 lacs) due from a director(approved by the Central Government). Maximum balance during the year Rs 2.78 lacs (Previous Year Rs 4.44 lacs).

9. Related party Disclosure (as identified by the Management) :

(i) Related party relationships :

a) Where control exists

Super Infincon Pvt. Ltd. Super Polyester Yarns. Ltd. Prajapati Mercantile Pvt. Ltd. P & M Distribution Pvt. Ltd.

b) Key Management Personnel :

Shri S S Mishra Shri R K Mishra Shri S K Mishra

c) Relatives of Key Management Personnel :

Shri B K Sharma

Shri N L Mishra & family

Smt R S Dhandh

Smt. S B Sharma

Ms. A B Sharma

10. Excise credit at the year end of Rs 72.54 lacs (Previous Year Rs 73.16 lacs) has not been accounted as, according to the management, the same is not realizable.

11. Segment Reporting : As the Company deals in only one segment i.e "Textiles", there are no reportable business segments. There are also no reportable geographical segments.

---

Mar 31, 2010

1. Contingent liabilities :

(a) Guarantees given by bank Rs Nil (Previous Year Rs Nil)

(b) Claims against the Company not acknowledged as debt nor provided for:

31.03.2010 31.03.2009

Rs.Lacs Rs. Lacs

i. Claims raised by the Sales Tax department in respect of earlier years disputed by the Company and appealed against 167.72 35.03

Less : Paid/(Provided) for out of the above 11.28 7.93

Total 156.44 27.10

Note : Excise duty of Rs 792.11 lacs, relating to certain sales made, from 4.07.1995 to 22.10.1996, was demanded by the Commissionerate, Daman, alongwith equal penalty, interest thereon and a fine of Rs 21 lacs. The Company appealed against the said order with CESTAT, Ahmedabad. The CESTAT had decided in favour of the Company. The Excise department has appealed before the High Court.

2. The Company is not required to obtain any licence under the Industrial Development and Regulations Act. Therefore the details of licenced capacity are not applicable. The installed capacity could not be worked out due to complexity of different deniers used. However, the Company has registered itself with the Textile Commissioner as a medium scale unit for Texturising, Twisting and Doubling of Art Silk yarns at Silvassa. The Company is also registered with the Secretariat of Industrial Approvals for its unit at Dharampur.

3. The Company has implemented all the terms of the sanctioned scheme and its net worth is positive, consequently the Company has made an application for discharge of its case under BIFR, from the purview of SICA.

4. In terms of the sanctioned scheme, the Company has converted share warrants of Rs 150.00 lacs into equity share capital at par on 30/03/2010.

5. Previous Years figures have been regrouped/rearranged wherever necessary. Figures in brackets relate to the previous year.

6. Loans and advances include housing loan of Rs 2.78 lacs (Previous Year Rs 4.44 lacs) due from a director (approved by the Central Government). Maximum balance during the year Rs 4.44 lacs (Previous Year Rs 6.11 lacs).

7. Related party Disclosure (as identified by the Management) :

(i) Related party relationships :

a) Where control exists

Super Infincon Pvt. Ltd.

Super Polyester Yarns. Ltd.

b) Key Management Personnel : Shri. S. S. Mishra

Shri. R. K. Mishra

Shri. S. K. Mishra

c) Relatives of Key Management Personnel :

Shri B.K. Sharma (Related to Shri S.S. Mishra, Shri R.K. Mishra & Shri S.K. Mishra)

8. Excise credit at the year end of Rs 73.16 lacs (Previous Year Rs 73.16 lacs) has not been accounted as, according to the management, the same is not realizable.

9. Segment Reporting : As the Company deals in only one segment i.e "Textiles", there are no reportable business segments. There are also no reportable geographical segments.

10. Debit and credit balances are subject to confirmation and reconciliation.

11. In view of brought forward losses no provision for taxation is considered necessary as per the Income Tax Act, 1961.