Mar 31, 2013
1. COMPANY OVERVIEW
M/s U G HOTELS AND RESORTS LIMITED, a public limited company
established in 1986 and has set up the first 5 Star Resort Project in
Himachal Pradesh, India. It has emerged a tourist destination of
reckoning and is named as "Shilon Resort-Forty acres of Switzerland".
The company is engaged in the business of running and maintaining
"Hotel Business" and all other related and ancillary objects.
2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Statement of compliance
The financial statements are prepared under the historical cost
convention on an accrual basis, in accordance with the generally
accepted accounting principles in India and in compliance with the
applicable accounting standards as notified under the Companies
(Accounting Standards) Rules, 2006, as amended and as per Revised
Schedule VI to the Companies Act, 1956. All assets and liabilities have
been classified as current or non-current as per the Company''s normal
operating cycle and other criteria set out in the Revised Schedule VI
to the Companies Act, 1956.
Use of estimates
The presentation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities as on date of the
financial statements and the reported amount of revenues and expenses
during the reporting year. Differences between the actual results and
estimates are recognized in the year in which the results are known or
materialized.
3. CONTINGENT LIABILITIES
Particulars Current Year Previous year
i) Suit filed against the Company by
UMAK Investment Company Rs. 12.30
Crore Rs. 12.30
Crore
Private Limited
ii) Suit filed against the Promoter
Directors of the Company and others Rs. 4.35
Crore Rs. 4.35
Crore
in their personal capacity by UMAK
Investment Company Private Limited
iii) Tax demand notice under the H.P.
Tax on Luxuries ( in Hotels and Rs. 43.64
Lacs Nil
Lodging Houses) Act, 1979 dated
29/03/2013''
* The Company has filed appeal against this demand of Luxury tax
liability at Honorable High Court of Shimla.
4. Demand Order under Section 7A of the Employees'' Provident Funds
and Miscellaneous Provisions Act, 1952 has passed for the period of 08/
07 to 04/2010 of Rs. 2,30,119/-, Company has paid it on vide challan
No. 00718 dated 7lh May, 2013.
5. Provision for Income Tax has not been made, there being no Income
tax liability as there was a loss during the year and also accumulated
losses from previous year.
6. Balance standing to the debit and credit of parties are subject to
confirmation from them.
7. In the opinion of the management, all current assets, loans and
advances have a value of realization at least equal to the extent
considered good and stated in the Balance Sheet.
8. Ministry of Company Affairs has vide its Notification No. S.O. 301
(E) dated 08 February, 2011 has exempted the Company from the
requirement of disclosure of quantitative details as per Part-ll of
Schedule VI of the Companies Act 1956, in the financial statements
subject to fulfillment of the conditions stipulated in paragraph 2 of
this notification. Company has been complied all conditions as
mentioned in Notification.
9. C.I.F. Value of Imports -NIL.
10. Value of consumption of raw material components and spare parts.
11. BASIC AND DILUTED EARNING PER SHARE
Basic earnings per share are computed by dividing the net profit/
(loss) attributable to equity shareholders for the year by the weighted
average number of equity shares outstanding during the year. Diluted
earnings per share are computed using the weighted average number of
equity shares and also the weighted average number of equity shares
that could have been issued on the conversion of all dilutive potential
equity shares. The dilutive potential equity shares are adjusted for
the proceeds receivable, had the shares been actually issued at fair
value. Dilutive potential equity shares are deemed converted as of the
beginning of the year, unless they have been Issued at a later date.
The number of equity shares and potential diluted equity shares are
adjusted for stock split, bonus shares and the potential dilutive
effect of employee stock option.plans as appropriate. Basic and
diluted earning per share for the year-ended 31.03.2013 is as under:
12. RELATED PARTY TRANSACTION
Pursuant to Accounting Standard (AS-18) - "Related Party Disclosure"
following parties are to be treated as Related Parties. Relationship
Name of the related parties
i) Related parties where control exists
Subsidiary Company U. G. Buildcon Pvt. Ltd
ii) Other related parties
Key management personnel Mr. Umesh Phalpher
(Chairman & Managing Director) Mr. Harmit Ghai (Whole Time Director)
13. DEFERRED TAX
In compliance with Accounting Standard 22 (AS 22) - ''Accounting for
taxes on income'', as notified under the Companies (Accounting
Standards) Rules, 2006, as amended, the Company in the absence of a
virtual certainty of future profits, has not recognized any deferred
tax assets during the current year.
14. EMPLOYEE BENEFITS
As per Accounting Standard 15" Employee Benefits" (Revised 2005), the
disclosures of employee benefits as defined in Accounting Standard are
given below:
The Company has classified the various benefits provided to employees
as under:
I. Defined Contribution Plans
a. Provident Fund
b. Employer''s Contribution to Employees'' Pension Scheme 1995
During the year, the Company has recognized the following amounts in
the Profit and Loss Account for the above Plans: Rs.0.57Lacs
(P.Y.Rs.1.43 Lacs).
II. Defined Benefit Plans
Contribution to Gratuity Fund (Non- Funded Scheme)
In accordance with Accounting Standard 15 (Revised 2005), Actuarial
Valuation was performed in respect of the aforesaid defined benefit
plan based on the following assumptions:
15. The Company has a subsidiary company hence the requirements of
Accounting Standard-21 relating to consolidate Financial Statements is
applicable to the Company.
16. Previous year figures have been regrouped, rearranged &
reclassified where ever considered necessary to confirm current year
figures.
Mar 31, 2012
1. COMPANY OVERVIEW
M/s U G Hotels & Resorts Ltd, a public limited company established in
1986 and has set up the first 5 Star Resort Project in Himachal
Pradesh, India. It has emerged a tourist destination of reckoning and
is named as "Shilon Resort-Forty acres of Switzerland". The company is
engaged in the business of running and maintaining "Hotel Business" and
all other related and ancillary objects.
2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS
Statement of compliance
The financial statements are prepared under the historical cost
convention on an accrual basis, in accordance with the generally
accepted accounting principles in India and in compliance with the
applicable accounting standards as notified under the Companies
(Accounting Standards) Rules, 2006, as amended and as per Revised
Schedule VI to the Companies Act, 1956. All assets and liabilities
have been classified as current or non-current as per the Company''s
normal operating cycle and other criteria set out in the Revised
Schedule VI to the Companies Act, 1956.
Use of estimates
The presentation of financial statements in conformity with the
generally accepted accounting principles requires estimates and
assumptions to be made that affect the reported amount of assets and
liabilities and disclosure of contingent liabilities as on date of the
financial statements and the reported amount of revenues and expenses
during the reporting year. Differences between the actual results and
estimates are recognized in the year in which the results are known or
materialized.
3. During the year, the assets of the company have been insured at
realisable / replacement values, wherever so applicable.
4. Provision for Income Ta x has not been made, there being no Income
tax liability as there was a loss during the year and also accumulated
losses from previous year.
5. Balance standing to the debit and credit of parties are subject to
confirmation from them.
6. In the opinion of the management, all current assets, loans and
advances have a value of realization at least equal to the extent to
which these are stated in the Balance Sheet.
7. Ministry of Corporate Affairs has vide its Notification No. S.O.
301 (E) dated 08 February, 2011 has exempted the Company from the
requirement of disclosure of quantitative details as per Part-II of
Schedule VI of the Companies Act 1956, in the financial statements
subject to fulfillment of the conditions stipulated in paragraph 2 of
this notification. Company has been complied all conditions as
mentioned in Notification.
8. C.I.F. Value of Imports  NIL.
9. Value of consumption of raw material components and spare parts.
10. BASIC AND DILUTED EARNING PER SHARE
Basic earnings per share are computed by dividing the net profit/
(loss) attributable to equity shareholders for the year by the weighted
average number of equity shares outstanding during the year. Diluted
earnings per share are computed using the weighted average number of
equity shares and also the weighted average number of equity shares
that could have been issued on the conversion of all dilutive potential
equity shares. The dilutive potential equity shares are adjusted for
the proceeds receivable, had the shares been actually issued at fair
value. Dilutive potential equity shares are deemed converted as of the
beginning of the year, unless they have been Issued at a later date.
The number of equity shares and potential diluted equity shares are
adjusted for stock split, bonus shares and the potential dilutive
effect of employee stock option plans as appropriate.
11. RELATED PARTY TRANSACTION
Pursuant to Accounting Standard (AS-18) Â "Related Party Disclosure"
following parties are to be treated as Related Parties.
Relationship Name of the related parties
i) Related parties where control exists
Subsidiary Company U. G. Buildcon Pvt. Ltd
ii) Other related parties
Key management personnel Mr. Umesh Phalpher
(Chairman & Managing Director)
Mr. Harmit Ghai
(Whole Time Director)
12. DEFERRED TAX
In compliance with Accounting Standard 22 (AS 22) Â ''Accounting for
taxes on income'', as notified under the Companies (Accounting
Standards) Rules, 2006, as amended, the Company in the absence of a
virtual certainty of future profits, has not recognized any deferred
tax assets during the current year.
13. EMPLOYEE BENEFITS
As per Accounting Standard 15" Employee Benefits" (Revised 2005), the
disclosures of employee benefits as defined in Accounting Standard are
given below: The Company has classified the various benefits provided
to employees as under:
I. Defined Contribution Plans
a. Provident Fund
b. Employer''s Contribution to Employees'' Pension Scheme 1995 During the
year, the Company has recognized the following amounts in the Profit
and Loss Account for the above Plans: Rs.3.13 Lacs (P.Y.Rs.2.55 Lacs).
II. Defined Benefit Plans Contribution to Gratuity Fund (Non- Funded
Scheme)
In accordance with Accounting Standard 15 (Revised 2005), Actuarial
Valuation was performed in respect of the aforesaid defined benefit
plan based on the following assumptions:
14. The Company has a subsidiary company hence the requirements of
Accounting StandardÂ21 relating to consolidate Financial Statements is
applicable to the Company.
15. The Revised Schedule VI has become effective from April 1, 2011
for the preparation and presentation of financial statements. This has
significantly impacted the disclosures and presentations made in the
financial statements. Previous Year''s figures have been regrouped
/reclassified wherever necessary to correspond with the current year''s
classification/disclosures.
Mar 31, 2010
1. CONTINGENT LIABILITIES
Current Year Previous year
a), i) Suit filed
against the company by Rs.12.30 Cr. Rs.12.60 Cr.
M/s UMAK Investment
Company
Private Limited
ii) Suit filed against
the Promoter Rs. 4.35 Cr. Rs. 4.40 Cr.
directors of
the company & others
in their personal
capacity by
M/s UMAK Investment
Company
Private Limited
2. During the year, the assets of the company have been insured at
realisable / replacement values, wherever so applicable.
3. Provision for Income Tax has not been made, being no Income tax
liability as there was a loss during the year and also accumulated
losses from previous year.
4. Balance standing to the debit and credit of parties are subject to
confirmation from them.
5. In the opinion of the management, all current assets, loans and
advances have a value of realization at least equal to the extent to
which these are stated in the Balance Sheet.
6. The term loans taken from IFCI, TFCI & upfront advance of ICICI
were secured against mortgage of all the immovable property both
present and future of Hotel / Resort at Shilon Bagh, Shimla and by way
of hypothecation of all movable except book debts and stocks present
and future of the said resort/ hotel subject to first charges created
and / or to be created in favour of the companys bankers for working
capital facilities. The mortgage and hypothecation charges referred to
above rank pari passu amongst all lending financial institutions on
which companys bankers have first charge. The Company had entered into
a one time settlement with IFCI & TFCI in the earlier years. In terms
of one time settlement, the Company has cleared the entire dues of IFCI
& TFCI in the earlier years. Though these loans have been repaid with
full & final settlement, the charge in favour of Financial Institutions
is yet to be vacated. An adjustment of Rs.10 Lacs is done every year
for upfront advance of ICICI.
7. The Company had taken loan from M/S UMAK Investment Company Private
Limited for the purpose of repayment of amount of one time settlement
to IFCI & TFCI. The Loan from M/S UMAK Investment Company Private
Limited was to be secured (of all original title deeds of assets, Share
certificates etc, after release from the IFCI) by way of mortgage of
all the immovable properties and movable assets except book debts and
stocks and pledge of share certificates in respect of equity shares
held by Guarantors in their own name or in the names of their friends,
relatives and associates. Till the date of these Financial Statements,
this Loan has not been secured by the Company as no documentation has
been done by the Company in favour of M/s UMAK Investment Company
Private Limited. However, the contention of the company was that the
entire loan along with interest due on it aggregating Rs.12.29 crores
has been adjusted into books against transfer of 8,14,930 number of
equity shares of the promoters @ Rs.151/- per share, as M/S UMAK
Investment Company Private Limited was interested in buying shares of
M/S. UG Hotels & Resorts Ltd. The above settlement / adjustment have
been done as per the Memorandum of Understanding dated 15th March, 2007
in the books of the company for the financial year 2007-2008 but M/s
UMAK Investment Company Private Limited has disputed the same at
various forums.
In lieu of settlement or adjustment of loans, two documents dated
18/05/2007 & 28/06/2007 were executed between UG Hotels & Resorts Ltd.
& Umak Investment Company Pvt. Ltd. and confirmed by Umak Investment
Company Pvt. Ltd. In these documents, it was stated that 4,54,350
shares & 3,60,580 shares in original of M/s UG Hotels & Resorts Ltd.
have been duly transferred in the name of Umak Investment Company Pvt.
Ltd. along with CDSL depositing slips in favour of Umak Investment
Company Pvt. Ltd., has been forwarded in compliance with obligation
under and in lieu of the agreements mentioned in those documents.
On 18/05/2007 & 28/06/2007 UG Hotels & Resorts Ltd. has passed the
adjustment entry of transfer of 3,94,000 equity shares by Mr.Umesh
Phalpher @ Rs.151/- each to Umak Investment Company Pvt. Ltd.
Accordingly, the Company has debited the Umak Investment Company Pvt.
Ltd A/c with Rs.5,94,94,000/- (3,94,000 equity shares @ Rs.151/-) and
credited the amount to Mr. Umesh Phalpher Loan A/c (Creating a loan of
Umesh Phalpher to such amount) in the books of UG Hotels & Resorts Ltd
as per the Memorandum of Understanding dated 15 th March, 2007 between
U G Hotels & Resorts Ltd and its promoters. Also on 18/05/2007 &
28/06/2007 UG Hotels & Resorts Ltd. has passed the adjustment entry of
transfer of 4,20,930 equity shares by Harmeet Ghai @ Rs.151/- each to
Umak Investment Company Pvt. Ltd. Accordingly, the Company has debited
the Umak Investment Company Pvt. Ltd A/c with Rs.6,35,60,430/-
(4,20,930 equity shares @ Rs.151/-) and credited the amount to Mr.
Harmeet Ghai Loan A/c (Creating a loan of Harmeet Ghai to such amount)
in the books of UG Hotels & Resorts Ltd as per the Memorandum of
Understanding dated 15 th March, 2007 between U G Hotels & Resorts Ltd
and its promoters.
Hence the loan given by Umak Investment Company Pvt. Ltd to UG Hotels &
Resorts Ltd was claimed to be adjusted by way of transfer of shares
belonging to Promoters, as they have transferred these shares as per
agreed price of Rs.151/- per share and hence have relinquished their
rights in these shares at an agreed consideration as per MOU dated 15
th March, 2007 between U G Hotels & Resorts Ltd and its promoters, so
that such amount, in books of the Company is payable to them and
accordingly loans from Directors were shown to such extent as on
31.03.2008. After these adjustment entries, the Company has claimed to
have settled the loan of M/s Umak Investment Company Pvt. Ltd and have
shown the corresponding loans from the Director namely Mr. Umesh
Phalpher & Harmeet Ghai to the extent of shares transferred by them at
an agreed consideration which is disputed by UMAK Investment Company
Private Limited. As on 31st March 2008, Rs.92332/- was shown
recoverable from Umak Investment Company Pvt. Ltd. in the books of the
Company for the Financial Year 2007-08.
In addition to above loan to the Company, M/s UMAK Investment Company
Private Limited has also advanced Rs 3.256 Crore loan to Directors of
the Company in their personal capacity. This loan was adjusted by way
of transfer of 2,17,470 equity shares belonging to promoters,
relatives, friends and associates to M/s UMAK Investment Company
Private Limited as per agreed price of Rs.151/- per share. The above
settlement / adjustment had been done as per the Memorandum of
Understanding dated 15th March, 2007, as M/s Umak Investment Company
Pvt Limited was interested to purchase the shares @ Rs.151/- per share
from its promoters, relatives, friends and associates but disputed by
UMAK Investment Company Private Limited. With regard to repayment of
above loans and related cases, a dispute had arisen between the Company
and M/s UMAK Investment Company Private Limited and both parties have
filed various suits/complaints against each other at various levels.
M/s UMAK Investment Company Private Limited has lodged complaints to
Ministry of Corporate Affairs and various Statutory and other
authorities with regard to act of cheating, misappropriation, breach of
trust, forgery etc. committed by the Directors of M/s U.G Hotels &
Resorts Ltd. in relation to loans of Rs 12.144 Crores to Company and Rs
3 Crore loan to Directors. Further, M/S UMAK
Investment Company Private Limited has also filed a suit for recovery
of Rs 12.46 Crores and mandatory and permanent injunction in respect of
movable and immovable properties including shares of the Company in the
Honble High Court of Delhi against the Company and suit for recovery
of Rs 2.33 Crores and mandatory and permanent injunction against its
promoters Directors Mr. Umesh Phalpher and Mr. Harmeet Ghai. The
Company had also filed a criminal complaint against Dr. Ramesh Kapur,
Chairman of M/s UMAK Investment Company Private Limited for illegally
appointing himself as a Director on the Companys Board. On 24th
September 2007, the Honble High Court of Delhi, inter-alia, passed the
ex parte interim orders directing the Company to maintain status quo in
respect of immovable properties and shares either in their own names or
in the names of their friends, relatives and associates till further
orders.
With regard to complaints lodged by M/s UMAK Investment Company Private
Limited with Ministry of Corporate Affairs, notice/ letter of
inspection U/S 209A of the Companies Act, 1956 was received by M/S. UG
Hotels & Resorts Ltd. and inspection was conducted by the official of
the Office of the Regional Director (NR) of Ministry of Corporate
Affair, Government of India. After conducting the inspection U/S 209A
of the Companies Act, 1956, a letter No. 1351/JDI/lnspn/2008/10155
dated 11/11/2008 was issued by the Office of Regional Director (NR),
asking the Company to give information on violation of various Sections
of Companies Act 1956 & explanation on other matters. Subsequent to
such inspection, Show Cause Notices have been issued by the office of
Registrar of Companies, Punjab, H P and Chandigarh, Ministry of
Corporate Affairs, Government of India for violation of various
Sections as mentioned below:
a) Under Section 211(7) for violation of Section 211 read with schedule
VI - Part 1 of the Companies Act, 1956.
b) Under Section 211(7) for violation of Section 211 of the Companies
Act, 1956.
c) Under Section 217(5) for violation of the Section 217(1) (e) of the
Act read with Companies (Disclosure of Particulars in the Board of
Directors) Rule 1988.
d) Under Section 292A(11) for violation of the Section 292A of the
Companies Act, 1956 read with Clause 49 of the Listing Agreement.
e) Under Section 629A for violation of the Section 297(1) read with
Section 299/300/301 of the Companies Act, 1956.
f) For violation of Section 127/140 of the Companies Act, 1956.
g) Under Section 629A for violation of the Section 292 read with
Section 286/287 of the Companies Act, 1956
h) Under Section 209(5) for violation of the Section 209 read with
Section 211 of the Companies Act, 1956 i) For violation of the Section
303(2) of the Companies Act, 1956 Company has filed compounding
application under section 621A before the Honble Company Law Board and
the matters are still pending. The Matter before Company Law Board New
Delhi Branch, New Delhi GP No. 06/ND/2009 CA No. 360/09 was decided by
Honble Board on 20/07/2009 at 4:30 PM by the Chairman of the Board.
This Decision was pronounced as a result of joint compromise filed by
M/s UG Hotels & Resorts Ltd., M/s Umak Investment Company, Pvt. Ltd
and their respective Promotors and all related parties before the
Honble Board. Salient features of the above mentioned order are as
below:
a) Rs. 12.60 Crores to be paid by UG Hotels & Resorts Ltd. and Mr.
Harmeet Ghai & Umesh Phalpher jointly or severally 12.144 Crores
towards principal and Rs. 45.60 Lacs towards interest.
b) Rs. 3.40 Crores to be paid by Mr. Umesh Phalpher and Mr. Harmeet
Ghai jointly or severally, Rs. 3.256 Crores towards principal amount
and Rs. 14.40 Lacs towards interest.
c) Rs. 1 Crores to be paid by Mr. Layak Ram in respect of advance given
for purchase of adjourning Land by Umak Investment Company Pvt. Ltd.
d) The repayment to be completed on or before 30.09.2010. Any remaining
amount shall carry an interest @12% p.a. from 01.10.2010 till the date
of payment of the entire amount.
e) The Company UG Hotels & Resorts Ltd. shall be entitled to locate
another buyer/lender and shall seek permission of Honble Board and
enter into a tripartite agreement between the Company UG Hotels Resorts
Ltd. and M/s Umak Investment Company Pvt. Ltd. and the Buyer/Lender and
the sale/mortgage/encumbrance etc. shall only be effected after the
permission from Honble Board and on payment of the balance sum to M/s
Umak Investment Company Pvt. Ltd.
f) The Company U G Hotels & Resorts Ltd and its Promotors Mr. Harmeet
Ghai & Mr. Umesh Phalpher and M/s Umak Investment Company Pvt. Ltd.
shall jointly file the settlement and the orders passed by Honble
Company Law Board before the Honble High Court of Delhi & they would
obtain consent decrees in Civil Suit No. 1749/2007 & 1750/2007 which
shall have the binding effect on the Company as well as its promotors.
g) After the Order is obtained from the Honble Board, the parties
shall withdraw all other cases/litigation pending amongst them.
h) If the payments are not made entirely by the company and its
promotors on or before 31.10.2010 or there is any breach of any of
terms agreed the order passed by the Honble Company Law Board and /
consent decrees passed by the honorable High Court can be executed by
M/s Umak investment Company Pvt. Ltd.
i) The Company as well as its promotors undertakes not to allot,
transfer any shares to the promoters group (except inter se transfer of
shares within the promoter group of the Company) or change the Board of
directors (except appointment and removal of independent directors)
without prior permission of the Honble Company Law Board.
Subsequent to the Order of Honble Company Law Board, the accounting
entries passed in Financial year 2007-2008 with regard to adjustment of
loan of M/s Umak Investment Company Pvt. Limited have been reversed in
financial year 2009-10 on 27* July, 2009, but have been accounted for
as on 31st March, 2009 as an accounting prudence in preparation of
these accounts. However till date of signing these accounts only a
payment of Rs. 30 lacs has been made.
8. The Company had applied for Exemption from the requirement of
disclosure of quantitative details as per Part - II of Schedule - VI to
the Companies Act, 1956, in the financial statements for the year ended
as on 31st March 2010.
Subsequently, Ministry of Company Affairs has vide its Order No.
46/159/2010-CL-lll dafed 09 June 2010 has exempted the Company from the
requirement of disclosure of quantitative details as per Part-ll of
Schedule VI of the Companies Act 1956, in the financial statements for
the year ended 31.03.2010.
9. C.I.F. Value of Imoorts - NIL
10. Earning in Foreign Exchange Nil Nil
11. Expenditure in Foreign Exchange Nil Nil
12. The Luxury Tax pertaining to year 1999-2000 amounts to Rs.18.67
Lacs which include Luxury tax of Rs 8.67 Lacs, interest of Rs 9.13 lacs
and penality of 0.87 lacs. Out of which Rs. 14.00 lacs has been paid
upto 31s1 March, 2009 & Rs.2.60 lacs has been paid during the year and
the balance of Rs 2.07 lacs is still outstanding.
13. TDS amounting to Rs. 0.55 lacs deducted during the year on account
of payment to leasing and hire-purchase companies has not been. paid.
14. As per the information available with the Company, no amount is
payable to Micro, S nail & Medium Scale Enterprises.
15. Amount received in the earlier years under Time Share Agreement
has now been shown under the head unsecured loans, as per the
direction/ instruction of Registrar of Companies vide their letter no.
TS/209A/6678/641 dated 09/07/2009.
16. BASIC AND DILUTED EARNING PER SHARE
Basic and diluted earning per share for the year-ended 31.03.2010 are
as under:
17. DEFERRED TAX
As a measure of prudence the deferred tax assets (Net) in terms of
Accounting Standard No.22 have not been recognized in the absence of
their being virtual certainty supported by convincing evidence that
sufficient future taxable income would not be available against which
such deferred tax assets could be realized.
18. EMPLOYEE BENEFITS
As per Accounting Standard 15" Employee Benefits" (Revised 2005), the
disclosures of employee benefits as defined in Accounting Standard are
given below:
The Company has classified the various benefits provided to employees
as under:
I) Defined Contribution Plans
a. Provident Fund
b. Employers Contribution to Employees Pension Scheme 1995
During the year, the Company has recognized the following amounts in
the Profit and Loss Account for the above Plans: Rs.1.84 Lacs (Rs.1.39
Lacs).
II) Defined Benefit Plans
Contribution to Gratuity Fund (Non- Funded Scheme)
In accordance with Accounting Standard 15 (Revised 2005), Actuarial
Valuation was performed in respect of the aforesaid defined benefit
plan based on the following assumptions:
19. RELATED PARTY TRANSACTION
Pursuant to Accounting Standard (AS-18) - "Related Party Disclosure"
following parties are to be treated as Related Parties.
S. NO. NAME RELATIONSHIP
1. Mr. Umesh Phalpher Key Management Personnel
(Chairman & Managing
Director)
2. Mr. Harmit Ghai Key Management Personnel
(Whole Time Director)
3. Delegation Tour Management Services Entity
of Relatives of the key
Management Personnel
(Prop. Bhalinder Ghai) (Bhalinder Ghai, son of Mr.
Harmeet Ghai)
4. U G Buildcon
Private Limited Subsidiary Company
20. The Board of Directors of the Company considers and maintains
"Hotel Business" as the only business segment of the company.
21. The Company has formed a subsidiary company (U G Buildcon Private
Limited) on January 22, 2010 but the accounts are not being
consolidated in this year keeping in view the first proviso to Sec.
166(1) of Companies Act, 1956 hence the requirements of Accounting
Standard-21 relating to consolidate Financial Statements is not adhered
by the Company.
22. The Company does not have any investments in Associates; hence
Accounting Standard - 23 on "Accounting for Investments in Associates"
in Consolidated Financial Statements is not applicable to the Company.
23. Accounting Standard- 27 on "Interim Financial Reporting on Joint
Ventures" is also not applicable to the Company.
24. Provision for Rs. 46.67 lacs has not been made for debts
considered as doubtful.
25. The Time Share membership/subscription amount is treated as
revenue for the year on the basis of Receipts, net of sale Commission
paid / payable divided by Number of years (16 or 33, as the case may
be) for which Time Sharing is sold, & 1/16 of the net amount has been
recognized as income for each next 16 year subscription and 1/16 of the
net amount every alternative year for 33 years subscription.
26. Previous year figures have been regrouped and reclassified
wherever necessary to make them comparable with the current years
figure.
Mar 31, 2009
1. CONTINGENT LIABILITIES
Current Year Previous Year
a).i) Suit filed against the company Rs.12.60 Cr. Rs.12.46 Cr.
by M/s Umak Investment
Company Private Limited
ii) Suit filed against the Promoter Rs. 4.40 Cr. Rs.2.33 Cr.
directors of the company &
others in their personal capacity
by M/s Umak Investment
Company Private Limited
2. During the year, the assets of the company have been insured
realisable / replacement values, wherever so applicable.
3. Provision for Income Tax has not been made, being no Incom tax
liability as there was a loss during the year and also accumulated
losses from previous year.
4. Balance standing to the debit and credit of parties are subject to
confirmation from them.
5. In the opinion of the management, all current assets, loans an
advances have a value of realization at least equal to the external to
which these are stated in the Balance Sheet.
6. The term loans taken from IFCI, TFCI & upfront advance of ICIC were
secured against mortgage of all the immovable propert both present and
future of Hotef / Resort at Shilon Bagh, Shimla and by way of
hypothecation of all movable except book debt and stocks present and
future of the said resort/ hotel subject to first charges created and /
or to be created in favour of the companys bankers for working capital
facilities. The mortgage and hypothecation charges referred to above
rank pari passes amongst all lending financial institutions on which
company1! bankers have first charge. The Company had entered into a
on< time settlement with IFCI & TFCI in the earlier years. In terms of
one time settlement, the Company has cleared the entire dues of IFCI &
TFCI in the earlier years. Though these loans have been repaid with
full & final settlement, the charge in favour of Financial Institutions
is yet to be vacated. An adjustment of Rs.10 Lacs is done every year
for upfront advance of ICICI.
7. The Company had taken loan from M/S Umak Investmen Company Private
Limited for the purpose of repayment of amount of one time settlement
to IFCI & TFCI. The Loan from M/S Umal. Investment Company Private
Limited was to be secured (of al original title deeds of assets, Share
certificates etc, after release from the IFCI) by way of mortgage of
all the immovable properties, and movable assets except book debts and
stocks and pledge of share certificates in respect of equity shares
held by Guarantors, in their own name or in the names of their friends,
relatives ana associates. Till the date of these Financial Statements,
this Loan has not been secured by the Company as no documentation has
been done by the Company in favour of M/s Umak Investment Company
Private Limited. However, the contention of the company was that the
entire loan along with interest due on it aggregating Rs. 12.29 crores
has been adjusted into books against transfer of 8,14,930 number of
equity shares of the promoters ç Rs.151/ per share, as M/S Umak
Investment Company Private Limited was interested in buying shares of
M/S. U. G. Hotels & Resorts Ltd. The above settlement / adjustment have
been done as per the Memorandum of Understanding dated 15th March, 2007
in the books of the company for the financial year 2007-2008.
In lieu of settlement or adjustment of loans, two documents dated
18/05/2007 & 28/06/2007 were executed between U. G. Hotels 8, Resorts
Ltd. & Umak Investment Company Pvt. Ltd. and confirmee by Umak
Investment Company Pvt. Ltd. In these documents, if was stated that
4,54,350 shares & 3,60,580 shares in original of M/s U. G. Hotels &
Resorts Ltd. have been duly transferred in the name of Umak Investment
Company Pvt. Ltd. along with CDSL depositing slips in favour of Umak
Investment Company Pvt, Ltd., has been forwarded in compliance with
obligation under and in lieu of the agreements mentioned in those
documents.
On 18/05/2007 & 28/06/2007 U. G. Hotels &-Resorts Ltd. has passed the
adjustment entry of transfer of 3,94,000 equity shares by Mr.Umesh
Phalpher ç Rs.151/- each to Umak Investment Company Pvt. Ltd.
Accordingly, the Company has debited the Umak Investment Company Pvt.
Ltd A/c with Rs.5,94,94,000/- (3,94,000 equity shares @ Rs.151/-) and
credited the amount to Mr. Umesh Phaipher Loan A/c (Creating a loan of
Umesh Phalpher to"such amount) in the books of U. G. Hotels & Resorts
Ltd as per the Memorandum of Understanding dated 15th March, 2007
between U. G. Hotels & Resorts Ltd and its promoters. Also on
18/05/2007 & 28/06/2007 U. G. Hotels & Resorts Ltd, has passed the
adjustment entry of transfer of 4,20,930 equity shares by Harmeet Ghai
ç Rs.151/- each to Umak Investment Company Pvt. Ltd. Accordingly, the
Company has debited the Umak Investment Company Pvt. Ltd A/c with
Rs.6,35,60,430/- (4,20,930 equity shares @ Rs.151/-) and credited the
amount to Mr. Harmeet Ghai Loan A/c (Creating a loan of Harmeet Ghai to
such amount) in the books of U. G. Hotels & Resorts Ltd as per the
Memorandum of Understanding dated 15,h March, 2007 between U. G. Hotels
& Resorts Ltd and its promoters. Hence the loan given by Umak
Investment Company Pvt. Ltd to U. G. Hotels & Resorts Ltd was claimed
to be adjusted by way of transfer of shares belonging to Promoters, as
they have transferred these shares as per agreed price of Rs.151/- per
share and hence have relinquished their rights in these shares at an
agreed consideration as per MOU dated 15th March, 2007 between U. G.
Hotels & Resorts Ltd and its promoters, so that such amount, in books
of the Company is payable to them and accordingly loans to Directors
were shown to such extent as on 31.03.2008.
After these adjustment entries, the Company has claimed to have
settled the loan of M/s Umak Investment Company Pvt. Ltd and have shown
the corresponding loans from the Director namely
-Mr. Umesh Phalpher & Harmeet Ghai to the extent of shares transferred
by them at an agreed consideration.
As on 31st March 2008, Rs.92,332/- was shown recoverable from Umak
Investment Company Pvt. Ltd in the books of the Company for the
Financial Year 2007-08. In addition to above loan to the Company, M/s
Umak Investment Company Private Limited has also advanced Rs 3.256
Crore loan to Directors of the Company in their personal capacity. This
loan was adjusted by way of transfer of 2,17,470 equity shares
belonging to promoters, relatives, friends and associates to M/s Umak
Investment Company Private Limited as per agreed price of Rs.151/- per
share. The above settlement / adjustment had been done as per the
Memorandum of Understanding dated 15th March, 2007, as M/s Umak
Investment Company Pvt Limited was interested to purchase the shares @
Rs.151/- per share from its promoters, relatives, friends and
associates.
With regard to repayment of above loans and related cases, a Ãdispute
had arisen between the Company and M/s Umak Investment Company Private
Limited and both parties have filed various suits/complaints against
each other at various levels. U/s Umak Investment Company Private
Limited has lodged complaints to Ministry of Corporate Affairs and
various Statutory and other authorities with regard to act of cheating,
misappropriation, breach of trust, forgery etc. committed by the
Directors of M/s U. G, Hotels & Resorts Ltd. in relation to loans of Rs
12.144 Crores to Company and Rs 3 Crore loan to Directors. Further,
M/S Umak Investment Company Private Limited has also filed a suit for
recovery of Rs 12.46 Crores and mandatory and permanent injunction in
respect of movable and movable properties including shares of the
Company in the Honble High Court of Delhi against the Company and suit
for recovery of Rs 2.33 Crores and mandatory and permanent injunction
against its promoters Directors Mr. Umesh Phalpher and Mr. Harmeet
Ghai, The Company had also filed a criminal complaint against Dr.
Ramesh Kapur, Chairman of M/s Umak Investment Company Private Limited
for illegally appointing himself as a Director on the Companys Board.
On 24th September 2007, the Honble High Court of Delhi, inter- alia,
passed the ex parte interim orders directing the Company to maintain
status quo in respect of immovable properties and shares either in
their own names or in the names of their friends, relatives and
associates till further orders.
With regard to complaints lodged by M/s Umak Investment Company Private
Limited with Ministry of Corporate Affairs, notice/ letter of
inspection U/S 209A of the Companies Act, 1956 was received by M/S. U.
G. Hotels & Resorts Ltd. and inspection was conducted by the official
of the Office of the Regional Director (NR) of Ministry of Corporate
Affair, Government of India. After conducting the inspection U/S 209A
of the Companies Act, 1956, a letter No. 1351/JDI/lnspn/2008/10155
dated 11/11/2008 was issued by the Office of Regional Director (NR),
asking the Company to give information on violation of various Sections
of Companies Act 1956 & explanation on other matters. Subsequent to
such inspection, Show Cause Notices have been issued by the office of
Registrar of Companies, Punjab, H.P. and Chandigarh, Ministry of
Corporate Affairs, Government of India for violation of various
Sections as mentioned below:
a) Under Section 211(7) for violation of Section 211 read with schedule
VI - Part 1 of the Companies Act, 1956.
b) Under Section 211(7) for violation of Section 211 of the Companies
Act, 1956.
c) Under Section 217(5) for violation of the Section 217(1) (e) of the
Act read with Companies (Disclosure of Particulars in the Board of
Directors) Rule 1988.
d) Under Section 292A(11) for violation of the Section 292A of the
Companies Act, 1956 read with Clause 49 of the Listing Agreement.
e) Under Section 629A for violation of the Section 297(1) read with
Section 299/300/301 of the Companies Act, 1956.
f) For violation of Section 127/140 of the Companies Act, 1956.
g) Under Section 629A for violation of the Section 255/256 of the
Companies Act, 1956.
h) Under Section 629A for violation of the Section 260 of the Companies
Act, 1956
i) Under Section 147(2) for violation of the Section 147 of the
Companies Act, 1956
j) Under Section 629A for violation of the Section 292 read with
Section 286/287 of the Companies Act, 1956
k) Under Section 209(5) for violation of the Section 209 read with
Section 211 of the Companies Act, 1956
l) For violation of the Section 154 (2)of the Companies Act, 1956
m) For violation of the Section 303(2) of the Companies Act, 1956
The Matter before Company Law Board New Delhi Branch, New Delhi CP No.
06/ND/2009 CA No. 360/09 was decided by Honble: Board on 20/07/2009 at
4:30 PM by the Chairman of the Board. This Decision was pronounced as
a result of joint compromise filed by
M/s U. G. Hotels & Resorts Ltd., M/s Umak Investment Company Pvt. Ltd
and their respective Promotors and all related parties before the Hoi
Board. Salient features of the above mentioned order are as below:
a) Rs. 12.60 Crores to be paid by U. G. Hotels & Resorts Ltd. and Mr,
Harmeet Ghai & Umesh Phalpher jointly or severally 12.144 Crores
towards principal and Rs. 45.60 Lacs towards interest.
b) Rs. 3.40 Crores to be paid by Mr. Umesh Phalpher and Mr. Harmeet
Ghai jointly or severally, Rs. 3.256 Crores towards principal amount
anc 14.40 Lacs towards interest.
c) Rs. 1 Crores to be paid by Mr. Layak Ram in respect of advance given
for purchase of adjourning Land by Umak Investment Company Pvl
d) The repayment to be completed on or before 30.09.2010. Any remaining
amount shall carry an interest @12% p.a. from 01.10.2010 till the da
payment of the entire amount.
e) The Company U. G. Hotels & Resorts Ltd. shall be entitled to locate
another buyer/lender and shall seek permission of Honble Board and
enlei a tripartite agreement between the Company U. G. Hotels Resorts
Ltd. and M/s Umak Investment Company Pvt. Ltd. and the Buyer/Lender the
sale/mortgage/encumbrance etc. shall only be effected after the
permission from Honble Board and on payment of the balance sum to Umak
Investment Company Pvt. Ltd.
f) The Company U. G. Hotels & Resorts Ltd and its Promotors Mr. Harmeet
Ghai & Mr. Umesh Phalpher and M/s Umak Investment Company Ltd. shall
jointly file the settlement and the orders passed by Honble Company
Law Board before the Honble High Court of Delhi & they would ol
consent decrees in Civil Suit No. 1749/2007 & 1750/2007 which shall
have the binding effect on the Company as well as its promotors.
g) After the Order is obtained from the Honble Board, the parties
shall withdraw all other cases/litigation pending amongst them.
h) If the payments are not made entirely by the company and its
promotors on or before 31.10.2010 or there is any breach of any of
terms agreec order passed by the Honble Company Law Board and /
consent decrees passed by the honorable High Court can be executed by
M/s U investment Company Pvt. Ltd.
i) The Company as well as its promotors undertakes not to allot,
transfer any shares to the promoters group (except inter se transfer of
shares the promoter group of the Company) or change the Board of
directors (except appointment and removal of independent directors)
without f permission of the Honble Company Law Board.
Subsequent to the Order of Honble Company Law Board, the accounting
entries passed in Financial year 2007-2008 with regard to adjustment
loan of M/s Umak Investment Company Pvt. Limited have been reversed in
financial year 2009-10 on 27th July, 2009, but have been account for as
on 31st March, 2009 as an accounting prudence in preparation of these
accounts.
8. The Company had applied for Exemption from the requirement of
disclosure of quantitative details as per Part - II of Schedule - VI to
the Company Act, 1956, in the financial statements for the year ended
as on 31st March 2009, on April 11, 2009.
Subsequently, Ministry of Company Affairs has vide its Order No.
46/159/2009-C L-lII dated 29 May 2009 has exempted the Company from
requirement of disclosure of quantitative details as per Part-ll of
Schedule VI of the Companies Act 1956, in the financial statements for
the year ended 31.03.2009.
9. C.I.F. Value of Imports -NIL
10. Earning in Foreign Exchange Nil Nil
11. Expenditure in Foreign Exchange Nil Nil
12. The Luxury Tax pertaining to year 1999-2000 amounts to Rs.18.67
Lacs which include Luxury tax of Rs 8.67 Lacs, interest of Rs 9.13 lacs
penality of 0.87 lacs. Out of which Rs. 11.00 lacs has been paid upto
31st March, 2008 & Rs.3.00 lacs has been paid during the year and
balance of Rs 4.67 lacs is still outstanding.
13. As per the information available with the Company, no amount is
payable to Micro, Small & Medium Scale Enterprises.
14. Amount received in the earlier years under Time Share Agreement
has now been shown under the head unsecured loans, as per the director
instruction of Registrar of Companies vide their letter no.
TS/209A/6678/641 dated 09/07/2009.
RELATED PARTY TRANSACTION
Plant to Accounting Standard (AS-18)
"Related Party Disclosure"
following parties are to be treated as Related Parties.
NO. NAMERELATIONSHIP
1. Mr. Umesh Phalphre
Key Management Personnel (Chairman & Managing Director)
2. Mr. Harmeet Ghai Key Management Personnel (Whole Time Director)
3. Delegation Tour
Management Services Entity of Relatives of the key Management
Personnel
(Prop. Bhalinder Ghai)(Bhalinder Ghai; son of Mr. Harmeet Ghai)
DEFERRED TAX
Measure of prudence the deferred tax assets (Net) in terms of
Accounting Standard No.22 have not been recognized in the absence of
their virtual certainty supported by convincing evidence that
sufficient future taxable income would not be available against which
such deferred Assets could be realized.
EMPLOYEE BENEFITS
Accounting Standard 15 "Employee Benefits" (Revised 2005), the
disclosures of employee benefits as defined in Accounting Standard are
below:
Company has classified the various benefits provided to employees as
under:
Defined Contribution Plans
Provident Fund
Employers Contribution to Employees Pension Scheme 1995 the year, the
Company has recognized the following amounts in the Profit and Loss
Account for the above Plans: Rs.1.39 Lacs (Rs. 1.31
15. The Board of Directors of the Company considers and maintains
"Hotel Business" as the only business segment of the company.
16. The Company does not have any subsidiary company hence the
requirements of Accounting Standard-21 relating to consolidate
Statements is not applicable to the Company.
17. The Company does not have any investments in Associates; hence
Accounting Standard - 23 on "Accounting for Investments in Asso
Consolidated Financial Statements is not applicable to the Company.
18. Accounting Standard- 27 on "Interim Financial Reporting on Joint
Ventures" is also not applicable to the Company.
19. Provision for Rs. 39.32 lacs has not been made for debts
considered as doubtful.
20. The Time Share membership/subscription amount is treated as
revenue for the year on the basis of Receipts, net of sale Commissi
payable divided by Number of years (16 or 33, as the case may be) for
which Time Sharing is sold, & 1/16 of the net amount has been n as
income for each next 16 year subscription and 1/16 of the net amount
every alternative year for 33 years subscription.
21. Previous year figures have been regrouped and reclassified
wherever necessary to make them comparable with the current years
figure.