a) Based on reference of Union Bank of India, the Lead Bank, a
financial restructuring package was approved by Empowered Group of
Corporate Debt Restructuring (CDR-EG).
While the company had given effect of the restructuring package in its
books of account, banks have continued to raise demand notices for
interest payment at the rate of interest charged prior to the sanction
of restructuring package.
The company has taken up the matter with the banks and accordingly the
resultant difference in interest (which is still under reconciliation /
determination) between the demand notice received from banks and as per
company''s books of account, has not been provided, as the liability is
b) Secured inter se on pari-passu basis by way of mortgage of all
immovable properties and hypothecation of all movable properties (save
and except stocks and book debts and moveables of electronic division)
both present and future. Loans (including current maturities of long
term debts) of Rs. 18,339.53 lacs (previous year Rs. 20,745.38 lacs) are
additionally secured by personal guarantee of the Managing Director.
c) Secured against third charge on the fixed assets of the company.
Loans (including current maturities of long term debts) of Rs. 2,793.25
lacs (previous year Rs. 3,185.97 lacs) are additionally secured by
personal guarantee of the Managing Director.
d) Secured against hypothecation of Vehicles acquired under Auto Loan
e) The term loans are further secured by way of first / second charge
on the existing fixed assets of a subsidiary company. Further, the
company has pledged 72,16,512 equity shares held by it in a subsidiary
company, as per CDR stipulation. However, the company has complied all
the stipulations of CDR terms and the pledged shares are yet to be
In terms of master restructuring agreement dated 30-03-2009, if the
company commits a default in payment or repayment of three consecutive
installment of principal amounts of the facilities or interest thereon
or any combination thereof, then, the lenders shall have the right to
convert, at their option, the whole of the outstanding amount of the
facilities and /or 20% of rupee equivalent of the defaulted amount into
fully paid-up equity shares of the company, at par, in the manner
specified in a notice in writing to be given by the lenders to the
company prior to the date on which the conversion is to take effect,
which date shall be specified in the said notice.
Secured by hypothecation of Raw materials, Semi finished goods,
Finished goods, Stores and Spares, Goods in transit and Book Debts of
Spinning and Home textile divisions, and further secured by second
charge on Fixed Assets both present and future and personally
guaranteed by the Managing Director.
1. TRADE PAYABLES
(a) The names of small scale industrial undertakings to whom the
company owes any sum together with interest and outstanding for more
than thirty days: Saikrupa Industries
Payments against supplies from small-scale industries are made in
accordance with agreed terms. Besides, there are no claims from the
parties for interest on overdue payments.
(b) The company has not received any intimation from other suppliers
regarding their status under the Micro, Small and Medium Enterprises
Development Act, 2006 and hence disclosures, if any, relating to
amounts unpaid as at the year end together with interest paid/payable
as required under the said Act have not been given.
(c) Includes amount payable to a subsidiary Rs. 0.04 lac(previous year Rs.
0.04 lac ).
a) * (i) 10 shares of Rs. 50/-each of Arcadia Premises Co-operative
b) # One vehicle costing Rs. 38.45 lac, is in the name of the Managing
Director as a nominee of the Company.
c) The company revalued its land, buildings and plant & machinery
(except for electronics division and 2 D.G. sets of spinning division )
as on 01 -10- 2008 based on the valuation made by an approved valuer.
Accordingly, the original cost of such assets resulted in gross
increase in the value of assets over their original cost by Rs. 15,092.28
lac , increase in depreciation upto 31-03-2012 on revaluation by Rs.
3,500.17 lac and thereby net revaluation reserve as at 31-03-2012 is Rs.
d) Revaluation of 2 D.G. sets of spinning division was carried out on
01 -04-2009 by an approved valuer.The revaluation resulted in a gross
increase in the value of assets over their original cost by Rs. 1,238.07
lac. increase in depreciation up to 31 -03-2012 on revaluation by Rs.
309.40 lac and thereby net revaluation reserve as at 31-03-2012 is Rs.
2. CAPITAL WORK IN PROGRESS
Capital work in progress does not include capital advances Rs. 54.10 lac
(previous period Rs. 13.15 lac).
3. DEFERRED TAX ASSETS
As required under Accounting Standard (AS-22), ''Accounting for taxes on
income'' issued by the Institute of Chartered Accounts of India, the
Company is required to account for deferred taxation while preparing
its accounts. The details of deferred tax assets / liabilities are as
Includes balance in current account with The Kolhapur Urban
Co-operative Bank Ltd. Rs. 4.82 lac (previous year Rs. 0.88 lac ) maximum
amount outstanding anytime during the year Rs. 5.49 lac (previous year Rs.
4.06 lac) and The Shamrao Vittal Co-operative Bank Rs. 2.83 lac (previous
year Rs. 2.08 lac) , maximum amount outstanding anytime during the year Rs.
3.63 lac (previous year Rs. 3.95 lac)
** Includes receipts for Rs. 0.01 lac ( previous year Rs. 0.01 lac ) lodged
with Sales Tax Department
4. CONTINGENT LIABILITIES AND COMMITMENTS
(to the extent not provided for)
(a) Contingent Liabilities
Particulars [Rs. in lac]
As at 31-03-2012 As at 31-03-2011
i) Amount outstanding in
respect of export bills 3,328.23 4,103.98
discounted under Export
Letters of Credit (Since
realised Rs. 3,152 lac, previous
year Rs. 2,901.56 lac)
ii) Bank Guarantees * 697.04 673.92
iii) Claims against the company
not acknowledged as debts 12.38 11.10
iv) Income Tax / Custom duty
demands disputed in appeals - 21.13
v) Corporate guarantee given
to a bank for securing
financial assistance to
subsidiary company 200.00 100.00
* The Company has given bank guarantee for Rs. 4.11 lac to DGFT on behalf
of Pranavaditya Spinning Mills Limited, subsidiary company for duty
free import of machines.
(b) In terms of EPCG Licence issued, the company has undertaken an
export obligation for Rs. 30,510.02 lac, which is to be fulfilled over a
period of 8 years. The company has completed the obligation to the
extent of Rs. 26,857.99 lac and necessary application for redemption of
license against which obligation is completed has been made to DGFT.
(c) In terms of advance license obtained for import of raw cotton the
company has undertaken an export obligation for Rs. 1,702.62 lac which is
to be fulfilled over a period of 2 years. The company has completed the
obligation to the extent of Rs. 1,669.33 lac
(d) Under the package scheme of incentives of Government of Maharashtra
for Mega Projects , the company is eligible for VAT and Electricity
duty refund benefits for its home textiles and consumer durable goods
divisions However, if it contravenes any of the conditions of the
scheme or eligibility certificate or certificate of entitlement or
agreement, it shall repay forthwith the entire benefits drawn / availed
along with interest thereon together with costs, charges and expenses
* Includes tax deducted at source Rs. 0.35 lac ( previous year Rs. 1.01
lac) Includes tax deducted at source Rs. 2.08 lac, ( previous year Rs. 2.79
(a) Includes operating lease:
i. The company has entered into lease arrangements , for renting
specified machinery at a rent of Rs. 2.23 lac per month for a period of
120 months and are renewable at the option of the lessee after the end
of the term.
* Includes purchased from a subsidiary company Rs. 549.39 lac (previous
year Rs. 526.31 lac)
5. EMPLOYEE BENEFITS EXPENSE
* Includes a sum of Rs. 96.54 lac paid to Managing Director and Executive
Director as per sanction of shareholder It exceeds by Rs. 48.54 lac as
per Schedule XIII of Companies Act 1956 due to inadequacy of profit.
The company is the process of applying to Company Law Board /
shareholders for approval of the excess remuneration paid .
6. OTHER EXPENSES
(b) Includes payment to auditors
7. FORWARD CONTRACTS
a) The company has outstanding foreign currency related derivative
contracts in the form of options for helping its business related
exposure which are not speculative in nature. The contracts have long
dated tenor with multiple contigent / uncertain events. As such
ascertainment of fair value of these contracts is not feasible.
However, banks estimate the total mark to market (MTM) of all
outstanding contracts at approx. Rs. 2,409 lacs as at 31-03- 2012,
(previous year Rs. 607 lac). The management is of the opinion that the
determination and crystalisation of liability is dependant upon the
outcome of uncertain future events or actions, not wholly within the
control of the Company. As adoption of AS-30 is presently not
mandatory, the estimated MTM loss of Rs. 2,409 lac for the year ended 31
-03-2012 (previous year Rs. 607 lac) has not been provided.
b) Outstanding derivatives instruments as at 31 -03-2012 entered by the
8. RELATED PARTY DISCLOSURES:
Related party disclosures as required by AS -18 Related Party
Disclosures are given below: - A. Relationship
(i) Key management personnel
1. Shri Anil Kumar Jain - Chairman and Managing Director
2. Shri R. N. Gupta - Joint Managing Director
3. Shri K. K. Lalpuria - Executive Director
4. Shri Kamal Mitra - Director (Works) (ii) Relatives of key
1. Smt.G. D.Jain
2. Smt.Shikha Jain
3. Ms. NehaJain
4. Shri MohitJain
(iii) Parties where control exists A. Subsidiary
1. Pranavaditya Spinning Mills Ltd.
2. Indocount Global Inc. (USA)
1. Margo Finance Ltd.
2. Indocount Securities Ltd.
3. Rini Investment and Finance Pvt. Ltd.
4. Sky Rise Properties Pvt. Ltd.
5. Unic Consultants
6. Yarntex Exports Ltd.
7. A. K. Jain
10. Figures for the previous year have been regrouped / rearranged
wherever considered necessary.
11. In the opinion of the management, the current assets, loans and
advances are expected to realise at least the amount at which they are
stated, if realised in the ordinary course of business and provision
for all known liabilities has been adequetly made in the accounts.
12. Figures have been rounded off to the nearest rupees in lac.
13. Additional Information (Pursuant to the provisions of Part II and
Part IV of Schedule VI to the Companies Act 1956 a) The Ministry of
Corporate Affairs, Government of India vide its General Notification
No. S.O.301 ( E) dated 8th February,2011 issued under Section 211 (3)
of the Companies Act, 1956 has exempted certain classes of companies
from disclosing certain information in their profit and loss
account. The Company being an ''export oriented company'' in entitled to
the exemption. Accordingly, disclosures mandated by paragraph 3(i)(a),
3(ii)(b) and 3(ii)(d) of Part II, Schedule VI to the Companies Act,
1956 have not been provided.