1.1 Terms/rights attached to equity shares
Holders of equity shares of Rs. 10 each are entitled to one vote per
share. The equity shareholders are entitled to dividend only if
dividend in a particular financial year is recommended by the Board of
Directors and approved by the member at the annual general meeting of
the year. In the event of liquidation of the Company, the holders of
equity shares will be entitled to receive out of the remaining assets
of the company, after distribution of Preferential amounts . The
distribution will be in proportion to the number of equity shares held
by share holders.
1.2 Terms/rights attached to Cumulative Redeemable Preference Shares
The holder of Preference Share of the Company have a right to vote at a
General Meeting of the Company only in accordance with limitations and
provisions laid down in Section 87 (2 ) of the Companies Act, 1956 .
The Preference Shares shall carry dividend at the rate of 2.5 % per
annum payable annually. The preference share holders will be entitled
to receive out of the remaining assets of the company after
distribution to all the secured and unsecured creditors. These CRPS are
redeemable at par : Rs. 61.78 Crores on 30.09.2019 and Rs. 26.61 Crores on
1.3 The Company has allotted 61,77,837 (Previous Year 26,61,363) 2.5%
Cumulative Redeemable Preference Shares (CRPS) of Rs. 100 each fully paid
up aggregating to Rs. 61.78 Crores (Previous Year Rs. 26.61 Crores) to Bank
of India in pursuant to line of credit approved by a bank to fund
1.4 Equity options outstanding as on 31st March, 2012:
i. To ESOS holders 9,98,887 ( Previous year 13,89,712 ) Refer Note No
ii. To a bank in respect of optionally convertible loan (OPCL) being a
part of line of credit sanctioned to finance derivative losses. The
OPCL outstanding as on 31st March, 2012 is Rs. 50.51 Crores ( Previous
year 15.21 Crores) Refer Note No 36.3.
1.5 Of the above Equity Shares 1,82,450 Equity Shares of Rs. 10/- each
were issued pursuant to the scheme of Amalgamation of Microsynth
Fabrics (India) Limited with the Company as sanctioned by Hon''ble High
Court of Judicature at Mumbai vide its order dated 23rd October, 2008.
1.6 The details of shareholder holding more than 5% shares :
2.1 Debentures referred to in (a) above are secured by way of first
mortgage & charge on pari passu basis on all the immovable and movable
properties except current assets , present and future, situated at
Silvassa, Dadra & Nagar Haveli (Union Territory) and at Sarigam,
District Valsad, Gujarat.
2.2 Term Loans from Banks & Financial Institutions referred to in ( b )
above are secured by way of first mortgage & charge on pari passu basis
on all the immovable and movable properties except current assets ,
present and future, situated at Silvassa, Dadra & Nagar Haveli (Union
Territory) and at Sarigam, District Valsad, Gujarat and are further
secured by Second charge on current assets of the Company situated at
Silvassa, Dadra & Nagar Haveli (Union Territory) and at Sarigam,
District Valsad, Gujarat.
2.3 External Commercial Borrowings referred to in (c) above are secured
by way of first mortgage & charge on pari passu basis on all the
immovable and movable properties except current assets , present and
future, situated at Silvassa, Dadra & Nagar Haveli (Union Territory)
and at Sarigam, District Valsad, Gujarat.
2.4 The Loans for vehicle have been secured by specific charge on the
vehicles covered under the said loans.
2.5 Terms of Repayment
Debentures are redeemable at par in one or more installments on various
dates with the farthest redemption being on 27.10.2014 and the earliest
being 27.01.2013.The debentures are redeemable as follows Rs. 10 Crores
as on 27.10.2014, Rs. 10 Crores as on 27.07.2014, Rs. 10 Crores 27.01.2014
and Rs. 10 Crores 27.07.2013.
ii) Secured Term Loans from Banks
Loan of Rs. 6.29 crores is repayable in 4 equal quarterly installments of
Rs. 1.57 crores starting from April 2013 and ending on January 2014 and
loan of Rs. 251.16 crores is repayable in 6 equal quarterly installments
of Rs. 3.22 Crores starting from June 2013 and ending on September 2014
and there after 16 equal quarterly installments of Rs. 14.49 Crores
starting from December 2014 and ending on September 2018.
iii) Secured Term Loans from Financial Institutions
Loan of Rs. 21.43 crores is repayable in 3 equal annual installments of Rs.
7.14 crores starting from July 2013 and ending on July 2015.
iv) Secured External Commercial Borrowings
Loan of Rs. 45.78 crores is repayable in 12 equal quarterly installments
of Rs. 3.82 crores (USD 7,50,000) starting from June 2013 and ending on
March 2016, loan of Rs. 101.74 crores is repayable in 16 equal quarterly
installments of Rs. 6.36 crores (USD 12,50,000) starting from March 2014
and ending on December 2017 and loan of Rs. 71.22 crores is repayable in
14 equal quarterly installments of Rs. 5.09 crores (USD 10,00,000)
starting from May 2013 and ending on August 2016.
v) Secured Vehicle Loans
Vehicle Loans are repayable as under : Rs. 0.17 crores in financial year
2013 -14, Rs. 0.17 crores in financial year 2014-15 and balance of Rs. 0.03
crores in financial year 2015-16.
vi) unsecured Term Loans From a Bank
Loan of Rs. 88.39 crores is repayable in 8 equal half yearly installments
of Rs. 11.04 crores starting from April 2014 and ending on October 2017
and loan of Rs. 50.51 crores will be converted in to Equity by 30.09.2013
at a price to be determine according to SEBI rules and guidelines
prevailing at that time.
vii) unsecured External Commercial Borrowings
Loan of Rs. 50.49 crores is repayable in July 2013.
2.6 Term loans from banks aggregating to Rs. Nil (Previous year Rs. 15.72
Crores) are guaranteed by two of the Directors of the Company and Rs.
139.74 Crores (Previous year Rs. 65.43 Crores) are guaranteed by one of
the Directors of the company in their personal capacity.
3.1 Working Capital Loans as referred to in (a) above are secured by
hypothecation of inventory of Raw Materials ,Work in process, Finished
goods, Stores and spares, Packing materials and Book Debts and are also
secured by way of Second charge on the immovable properties of the
company situated at Silvassa, Dadra & Nagar Haveli (Union Territory)
and at Sarigam, District Valsad, Gujarat.
@ Does not include any amounts, due & outstanding, to be credited to
Investor Education & Protection Fund.
* Other payable includes Salaries, wages & bonus payable, Withholding &
Other Taxes payable and outstanding liabilities.
*The company has recognised liability based on substantial degree of
estimation for excise duty payable on clearance of goods lying in stock
as on 31st March, 2011 of Rs. 15.30 Crores as per the estimated pattern
of despatches. During the year Rs. 15.21 Crores was utilised for
clearance of goods. Liability recognised under this class as at 31st
March, 2012 is Rs. 17.02 Crores. Actual outflow is expected in the next
4.1 Buildings include Rs. 8000/- being the value of Shares of
4.2 Additions to fixed assets & Capital work in Progress are inclusive
of loss of Rs. 16.80 Crores (Previous Year Rs. 6.00 Crores) on account of
foreign exchange difference during the year.
4.3 Capital work in progress includes :
i) Rs. 6.24 Crores on account of Preoperative expenses (Previous Year Rs.
ii) Rs. 5.88 Crores on account of cost of construction material at site
(Previous Year Rs. 26.82 Crores)
11.4In accordance with the Accounting Standard (As -28) on Impairment
of Assets As notified by Companies (Accounting Standards) Rules 2006,
the management during the year carried out an exercise of identifying
the assets that may have been impaired in respect of each cash
generating unit in accordance with the said Accounting Standard. On the
basis of this review carried out by the management, there was no
impairment loss on Fixed Assets during the year ended 31st March, 2012.
5.1 Non-Current Investments are carried at cost less provision for
diminution in the value other than temporary (Refer Note No-1 H).
5.2 Aggregate Amount of Non - Current Investments :
5.3 As at 31st March, 2012, the company has invested Rs. 1.45 Crores
(Previous year Rs. 1.76 Crores) to HDFC Asset Management company Limited
(the Portfolio Manager) for providing Discretionary Portfolio
Management Services which is in the nature of investment administrative
management services and include the responsibility to manage, invest
and operate the assets under the HDFC AMC PMS -Real Estate Portfolio -1
(Real Estate Portfolio), as per the agreement dated 1st January, 2008
The securities representing the outstanding balance of Rs. 1.45 crores as
at 31st March, 2012 (Previous year Rs. 1.76 crores) have been accounted
* Loans and advances to a related party represents share application
money pending allotment given to JBF Global Pte Ltd., a subsidiary
company. **Mainly includes unamortised ancillary borrowing cost and
6.1 The Aggregate amount of Provision for Diminution in Value of
Current Investments is Rs. 0.27 Crores ( Previous Year Rs. 0.10 Crores)
6.2 Current investments are carried at lower of cost and market
value/NAV, computed individually (Refer Note No. 1 H).
(Note:- As per Company policy, Loans given to employees are not
considered under this clause.
b) Investment by the loanee in the share of the Company : Nil
c) Investment by the JBF Global Pte Ltd in ordinary shares of JBF RAK
LLC, a subsidiary company : 2,37,159 Shares
7.1 Salaries, Wages and Allowances includes managerial remuneration of
Rs. 4.42 Crores subject to approval of Central Government.
7.2 The disclosures required under Accounting Standard 15 Employee
Benefits notified in the Companies (Accounting Standards) Rules 2006,
are given below:
B. Defined Benefit Plan
The present value of Employees'' Gratuity obligation is determined based
on actuarial valuation using the Projected Unit Credit Method, which
recognises each period of service as giving rise to additional unit of
employee benefit entitlement and measures each unit separately to build
up the final obligation. The obligation for leave encashment is
recognised in the same manner as gratuity.
The estimated future salary increases takes into account inflation,
seniority, promotion and other retirement factors including supply and
demand in the employment market. The above information is certified by
7.3 Employment Stock option Scheme
i. The Employee Stock Option Scheme,2009 ( JBF ESOS 2009) was
introduced and implemented during the year 2009-10 as approved by the
shareholders at the Annual General Meeting held on 25th September,
2009. The equity shares reserved for issuance to eligible employee of
the company as at 31st March, 2012 is 2,51,728 ( Previous Year
2,32,070) Equity Shares of Rs. 10/- each .
ii. On 25th September, 2009 the Company has granted 21,54,000 Options
convertible into Equity Shares of Rs. 10 each to 298 employees. The
Exercise Price of the Options was fixed at Rs. 60 each for conversion in
to one Equity Share of the Company. Out of above Options 24,677
(Previous Year 70,784) Options have been lapsed during the year
iii. During the year the Company has further granted 5019 (Previous
Year 45,000) Options convertible into Equity Shares of Rs. 10 each to 2
employees. The Exercise Price of the Options was fixed at Rs. 60 each
for conversion in to one Equity Share of the Company.
iv. The above Options vest over a period ranging from one to three
years as follows.
v. All the Options granted till date have an exercise period of Twenty
Four months from the date of their vesting.
vi. The Company applies intrinsic- value method of accounting for
determining Employee Compensation Expenses for its ESOS. Had the
Employee Compensation Expenses been determined using the fair value
approach, the Company''s Net Profit and basic and diluted earnings per
share as reported would have reduced as indicated below:
Since long term optionally convertible loan of Rs. 50.51 crores (previous
year Rs. 15.21 Crores) are to be converted into such number of equity
shares of Rs. 10 each at a price to be determined according to SEBI Rules
& Guidelines prevailing at that time, total number of equity shares to
be issued on exercise of conversion option is not certain and hence the
same has not been considered for the computation of Diluted Earning Per
8 CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED
(Rs. in Crores)
Particulars As at As at
31st March, 2012 31st March, 2011
(i) Contingent Liabilities
(a) Demands not acknowledged as debt
i) Income Tax 0.25 7.41
ii) Excise Duty (Rs.1.13 Crores
deposited under protest) 1.29 1.26
iii) Service tax 1.44 1.49
iv) Others 0.09 0.09
(b) Guarantees issued by
the Bankers 251.74 190.06
(Bank guarantees are provided
obligation. No cash outflow is
(c) Corporate Guarantee to banks
against the Letter of credit
facility to Subsidiary Company.
(No Cash outflow -- 531.73
(d) Letter of Credit includes Rs.
152.61 Crores (Previous year Rs.
157.62 Crores) extended for
Subsidiary Company. 305.91 175.82
(These are established in
favour of vendors but cargo/
material under the aforesaid
Letter of Credit are yet to
be received as on end of the
year. Cash outflow is expected
on the basis of payment terms as
mentioned in Letter of Credit.)
(e) Export Bill Discounting 10.09 --
(No Cash outflow is expected)
(a) Estimated amount of contracts
remaining to be executed on capital
account and not provided for
(net of advance) 22.66 11.48
(Cash outflow is expected on execution of such capital contracts, on
Notes to Related Party Transactions:
i. Share Application Money includes Rs. 397.95 Crores given to JBF
Global Pte. Ltd.
ii. Non-current Investment includes Rs. 25.00 Crores invested in JBF
iii. Short term Loan & Advances includes Rs. 74.28 Crores & Rs. 24.57
Crores given to JBF Petrochemicals Ltd & JBF Global Pte. Ltd
iv. Trade Receivable includes Rs. 2.69 Crores from JBF RAK LLC.
v. Dividend paid includes Rs. 15.96 Crores, Rs. 3.43 Crores & Rs. 3.12
Crores to Mr. B C Arya, Chinar Arya & Vaidic Resources Pvt. Ltd.
vi. Income: Revenue from Operations includes Rs. 53.11 Crores to JBF RAK
LLC. Interest Income Includes Rs. 2.87 Crores from JBF Petrochemicals Ltd
and Miscellaneous Income includes Rs. 1.25 Crores from JBF RAK LLC .
vii. Expenditures: Purchases include Rs. 41.74 Crores from Arya
Industries respectively. Managerial Remuneration include Rs. 4.42 Crores
and Rs. 0.67 Crores paid to Mr. B C Arya & Mr. Rakesh Gothi respectively.
viii. Equity Shares alloted on exercise of ESOS includes Rs.0.09 Crores
& Rs. 0.08 Crores to Mr. Rakesh Gothi and Mr. P N. Thakore respectively.
ix. Letter of credit facility extended by the Company includes Rs.
152.61 Crores on behalf of JBF Global Pte. Ltd.
9 As per Accounting Standard (AS) 17 on Segment Reporting , Segment
Information has been provided under the Notes to Consolidated Financial
10 Income Tax Assessment of the Company has been completed up to the
accounting year ended on 31 March, 2009.
10.1 All Derivative and financial instruments acquired by the company
are for hedging purpose only.
10.2 The loss of Rs. 167.77 Crores in respect of foreign exchange and
interest rate swap contracts for the year have been charged to the
Statement of Profit and loss. The Mark to market losses in respect of
the derivative contracts for Currency & Interest Swap as on 31st March,
2012 is Rs. 47.48 Crores (Previous Year Rs. 144.63 Crores), which have not
been provided in the books of account since the company is of the view
that the above losses may be payable only if loss conditions are
triggered on observation dates starting from 3rd August, 2010 and
ending on 3rd July, 2013. The loss if any, will be accounted for on
actual settlements. Bank of India with whom, one of above derivative
transaction is outstanding has approved a line of credit to fund losses
on account of derivative transaction by way of debt, convertible loan
and cumulative redeemable preference shares. Accordingly during the
year, the Company has issued 61,77,837 (Previous Year 26,61,363), 2.5%
Cumulative Redeemable Preference Shares (CRPS) aggregating to Rs. 61.78
Crores (Previous Year Rs. 26.61 Crores) & bank has disbursed loan of Rs.
61.78 Crores (Previous Year Rs. 26.61 Crores) and optionally convertible
loan of Rs. 35.30 Crores (Previous Year Rs. 15.21 Crores).
10.3 The Expenses on account of forward premium on outstanding forward
exchange contracts to be recognised in the profit & loss account of
subsequent accounting year aggregate to Rs. 1.22 Crores (Previous Year Rs.
11 The Revised Schedule VI has become effective from April 1, 2011 for
the preparation of financial statements. This has significantly
impacted the disclosure and presentation made in the financial
statements. Previous year''s figures have been regrouped/reclassified
wherever necessary to correspond with the current year''s