1. CONTINGENT LIABILITIES :
a] Income Tax/Sales Tax demands against which the Company has preferred
appeals amount to Rs. 739.91 Lacs (Previous Year Rs. 72.43 Lacs).
b] Guarantees given on behalf of companies Rs 3610 Lacs (Previous Year
Rs. 2,360 Lacs.)
2. Nine creditors and lenders of the Company have individually field
winding up petitions against the Company in the Hon'ble High Court of
Calcutta for non-payment of dues. The Company has already filed
affidavits in respect of all such cases. In respect of the eight
cases, the Hon'ble High Court has drawn up a schedule of repayment of
dues of the creditors and lenders.
3. Considering the strategic investments, that the Company has made, in
the equity shares of DCL Polyester Ltd. aggregating to Rs 270.00 lacs
is long term in nature. The Management is of the view that the market
rates quoted do not reflect the true reasonable value of the
investment. The Management is therefore of the opinion that the
diminution in value, if any, is not determinate.
4. Addition to the fixed assets includes Rs. 13.64 lacs on account of
exchange difference during the year.
5. Export sales includes Rs. 773.48 Lacs (Previous Year Rs. 1692.98
Lacs) on account of gain on exchange variation and purchases includes
exchange variation on imports purchases of Rs. 18.90 Lacs arising
during the year.
6. The Company at its Annual General Meeting of members held on 31st
July, 1998 declared a dividend of 10% on the Equity Share Capital for
the year ended 31st March, 1998. Pursuant to a suit filed by a
Company, the High Court of Judicature at Chennai by its Order dated
31st July, 1998 restrained the Company from distributing dividends.
Pending the hearing and final disposal of the suit and in terms of the
subsisting order of the High Court, the Company has not disbursed
dividend to its shareholders. In view of the operation of law, the
Company has not taken steps pursuant to Section 205A of the Companies
Act, 1956 for transfer of the said dividend to a Special Dividend
account in a Scheduled Bank.
7. Confirmation of balances have not been obtained from certain parties
in respect of Unsecured Loans, Sundry Debtors, Loans and advances -
Others, Sundry Creditors and in respect of balances with Scheduled
banks. Pending confirmation such balances are subject to
reconciliation and consequential adjustments, if any.
8. i) Loans and Advances :
a) Advances recoverable in cash or in kind Rs 367.25 Lacs (Previous
Year Rs. 600.26 Lacs) and Loans and Advances - Other includes Rs.
856.55 Lacs (Previous Year Rs. 633.11 Lacs) which are outstanding for
periods exceeding one year. In the opinion of Management, the said
amounts are good and recoverable and no provision is considered
necessary in the accounts.
b) Advances recoverable in cash or in kind includes sums aggregating to
Rs. 4,405.51 (Previous year Rs.3562.55 lacs) being interest debited by
banks to the account of the Company on outstanding post shipment credit
facilities availed by the Company not yet liquidated due to failure of
the export customers to settle the outstanding bills of the Company.
The balances due have been confirmed by the said export customers. A
schedule of repayment, duly approved by the Board of Directors at their
meeting on 29th May, 1998 was drawn up and agreed to by customers in
terms of which the amounts were to be repaid over a period of 12 months
commencing from January, 1999. However, the export customers have not
paid any amount till date. In the opinion of the Management, the dues
are good and recoverable and no provision is considered necessary in
ii) Sundry Debtors includes Rs. 17,861.07 lacs on account of export
bills outstanding for periods exceeding one year which are duly
confirmed by the parties concerned including an amount of Rs. 682.26
lacs on account of exchange variation on reclassification of foreign
currency balances outstanding as at the balance sheet date. The
Company had obtained approval from the Reserve Bank of India for
extension of time till 30th May, 2000 for recovery of the said debts.
The Company has made an application to the Reserve Bank of India for
further extension of time till 30th September, 2000 for recovering of
the said amounts. In the opinion of the Management, the dues are good
and recoverable and no provision is considered necessary in the the
9. During the year coming has made/rejected certain on account payments
to/from various parties/companies on account of exigencies of the
business. Under such circumstances the documentation in all such cases
would not have been maintained.
The Company is in the process of substantiating such debits and credits
and is confident to do so in the current year.
10. The Company has given Guarantees to the extent of Rs. 950.00 Lacs
during the year. The Company has been legally advised that Provisions
of Section 372A of the Companies Act, 1956 are not applicable to the
11. The Company does not have nay outstanding dues for more than Rs.
1.00 lac for a period exceeding 30 days to small scale industrial
12. The value of land amounting to Rs.2550.66 lacs, included in the
fixed assets schedule has been hypothecated as a collateral security
with Global Trust Bank Ltd. for the term loan facility availed by
13. (i) The Company had availed of unsecured loans and admitted
Acceptances (disclosed under Current Liabilities) during previous
years at agreed rates of interest, for specified periods. The Company
is renegotiating its liability to repay the is not determinable, hence
no provision is made in the accounts.
ii) In other cases of acceptances, disclosed under Current Liabilities
there are no confirmations from the parties as to the terms of
repayment of Principal and payment of interest, if any.
14. Remuneration to Wholetime Directors : (Rs. in Lacs)
Current Year Previous year
a) Salary 18.00 29.20
b) Provident Fund 1.62 2.16
c) Gratuity 2.60 2.31
d) Other Benefits 0.00 0.00
15. Remuneration to Auditors :
(Rs. in Lacs)
Current Year Previous Year
a) Audit Fees 5.04 4.73
b) Tax Audit Fees 1.57 1.57
c) Consultation Fees 1.20 1.00
d) Certification Charges 1.42 0.30
16. The Company has 1 (one) non-resident share holder during the year
(Previous year - one)
17. Prior year Adjustment account represents Service Tax on Audit fees
of Rs. 3,750.00 & short provision of depreciation of Rs 2,43,425.00
short provision for tax and Rs. 40,53,256/- on account of provision for
Agency commission no longer required written back excess provision of
Tax on dividend of Rs.63,092/- written back.
18. The expenses pertaining to gold project upto the date of
commissioning of the project i.e. 26th March, 2000, as certified by the
management are taken as pre-operative expenses.
19. Previous years figures have been regrouped and reclassified