1. Capital commitments:
The estimated amount of contracts remaining to be executed on capital
account, and not provided for (net of advances) as at 31 st March, 2011
Rs. 8,680.70 lacs (Previous year: Rs. 152.84 lacs) (including in
respect of loint Venture Rs. 130.09 lacs (Previous year Rs. Nil)).
2. Contingent liabilities:
Rs. in Lacs
As at 31st
March, 2011 As at 31st
a) Disputed demands of following authorities
Income tax 19.68 18.58
Excise duty ( Rs.19.41 lacs (Previous Year
Rs.16.41 lacs) paid under protest) 4,663.64 1,727.38
(Also Refer Note No. 1 below)
Sales tax ( Rs. 7.70 lacs ( Previous Year
Rs. Nil) paid under protest) 77.03 -
employees State Insurance Corporation
(ESIC) (Refer Note No. 2 below) 0.96 -
(The Company has contested these demands
before various authorities and is hopeful
of success in the respective matters)
b) Bank Guarantee (Given as
performance guarantee) 436.05 293.57
c) Letters of Credit (L/C) 1,280.83 12.65
Total 6,456.92 2,052.18
1) Pursuant to the Rule 10(A) of Central Excise Rules, 2002 which was
inserted vide Notification no. 9/2007-CE(N.T) dated 1.03.2007, the
Company has started paying differential Excise Duty on sales made to a
customer (which is the subject matter of dispute in the aforesaid
demands) since September 2010 under protest. The aggregate of such
payment made under protest up to the year-end amounts to Rs. 38.68 lacs
(Previous Year Nil).
3) The Company is in the process of filling reply with the ESIC
authorities, as the said demand has arisen due to payment of ESIC dues
under an incorrect code which needs to be rectified by the authorities.
4. The Company had challenged the constitutional validity of entry tax
collected by State of Madhya Pradesh on goods purchased from other
states by filing a writ petition in Honorable High Court of Madhya
Pradesh on 30th August, 2007. The petition was decided against the
Company during the previous year. The Company had filed a special leave
petition (SLP) before the Honorable Supreme Court, again challenging
the constitutional validity of Entry Tax. As per the interim order
passed by Supreme Court, the Company has been directed to deposit the
unpaid Entry tax before the petition is decided.
The Company has already deposited Entry tax aggregating to Rs. 606.15
lacs (Including Interest Rs. 1.47 lacs) for the period from April 2007
to Dec 2010 to the authorities, under protest (included in Schedule 10:
''Loans and Advances''). Balance amount of Entry tax payable forthe
period from January 2011 to March 2011 aggregates to Rs. 45.11 lacs,
which will be deposited subsequently, under protest.
The Supreme Court has transferred the above SLP to a Higher Bench
before the Chief Justice of the Supreme Court of India for decision,
which is pending. The Company is hopeful that the matter will be
decided in its favor and hence no provision forthe above is required in
the accounts at this stage.
5. The Company operates in the business of sheet metal fabrication and
bodybuilding. Due to the nature of the production activities, wherein
fixed assets like plant and machinery can be put to multiple uses and
multiple activities can be carried out simultaneously in production
premises etc., changes in related technology may not materially affect
the productivity of the Company in future. Accordingly, the fixed
assets acquired/purchased after 1st January, 2011 are being depreciated
using the straight line method overthe management''s estimate of useful
life of these assets. Due to this change in providing for depreciation,
the depreciation charge forthe year is lower and the written down value
of such assets is higher by Rs. 6.68 lacs and the profit after tax for
the year is higher by Rs. 6.62 lacs.
6. During the previous year, the Company has entered into an agreement
with a party for the purpose of engaging into a Jointly Controlled
Operations (]C0) to manufacture market and sell fabricated automobile
bodies and components to Original Equipment Manufacturers and to other
customers, at ]amshedpur. Per the agreement, the Company and the other
venturer have agreed to share the distributable cash flow from the ]C0
after paying all taxes in the ratio of 60:40 respectively. In addition
to the above, the Company is required to pay a fixed sum for grant of
license to use the factory premises of the other venture for the
purposes of the operations as follows:
In year 1 - Rs. 300,000 per month
In year 2- Rs. 315,000 per month
In year 3 - Rs. 330,750 per month
Accordingly, 40% share of loss from the operations for the year ended
31st March, 2011 aggregating to Rs. 32.00 lacs (Previous Year- Rs. 5.59
lacs) has been transferred to the joint venture partner and disclosed
as Other income in Schedule 14.
7. During the previous year, pursuant to the resolution passed by the
shareholders at the Extraordinary General Meeting held on 18th March,
2010, the Company has sub-divided each Equity share of Rs. 100/- each
into 10 shares of Rs. 10/- each.
Further, the Company, during the previous year has issued 36,767,760
Equity shares of Rs. 10/- each as bonus shares at the rate of 6 shares
for each share held at 18th March, 2010 aggregating to Rs. 3,676.77
lacs by way of capitalisation of Securities premium account and balance
in Profit and Loss Account respectively.
8. As per the information available with the company, the following
are the details of dues to the creditors who have confirmed their
registration under the Micro, Small and Medium Enterprises Development
Act, 2006. (MSMED Act)
i) Dues remaining unpaid as at the year-end
Principal - Rs.9.71 lacs (Previous Year 15.35 lacs)
Interest - Rs.1.05 lacs (Previous Year 12.46 lacs)
ii) Interest paid in terms of Section 16 of the MSMED Act- Nil
iii) Amount of interest due and payable for the year of delay in making
payments- Rs. 1.05 lacs (Previous Year Rs. 3.62 lacs) iv) Amount of
interest accrued and remaining unpaid as at the year-end - Rs.13.51
lacs (Previous Year Rs. 12.46 lacs) v) Amount of interest due and
payable on previous year''s outstanding amount - Rs.-12.46 lacs.
(Previous Year Rs. 8.84 lacs)
9. (a) Contributions are made to Provident Funds which covers all
regular employees. Amount recognised as expense in respect of these
defined contribution plans, aggregate to Rs. 67.36 lacs (previous year
Rs. 44.77 lacs).
Provision is made for gratuity based upon actuarial valuation done at
the end of every financial year using ''Projected Unit Credit'' method
and it covers all regular employees. Gains and losses on changes in
actuarial assumptions are accounted for in the Profit and Loss account.
10. The principal business of the Company is sheet metal fabrication
and bodybuilding. All other activities of the Company revolve around
its main business. Hence, there is only one reportable business segment
as defined by Accounting Standard 17- Segment Reporting (AS 17).
11. During the year, the Company successfully completed the Initial
Public Offering (IPO) of its shares which are now listed on the Bombay
Stock Exchange and the National Stock Exchange. The IPO consisted of
issue of 1,20,47,244 Equity Shares of Rs. 10/- each issued at a premium
of Rs. 117 each, aggregating to Rs.127.
The expenses relating to the IPO aggregating to Rs.1,257.48 lacs, have
been adjusted from the Securities premium account received as stated
above in accordance with section 78 of the Companies Act, 1956.
12. Figures of previous year are regrouped wherever necessary to
correspond with the figures of the current year.