1.  Corporate Information
 
 Kitex Garments Limited is a public company incorporated in India under
 the provisions of the Companies Act, 1956. Its shares are listed on The
 Bombay Stock Exchange, The National Stock Exchange and The Cochin Stock
 Exchange. The Company is engaged in the manufacture of fabric and
 readymade garments. The readymade gar- ments manufactured are exported.
 
 2.  Basis of Preparation
 
 2.1. The financial statements of the company have been prepared in
 accordance with the Generally Accepted Accounting Principles in India
 (Indian GAAP). The company has prepared these financial statements to
 comply in all material respects with the accounting standards notified
 under the Companies (Accounting Standards) Rules, 2006, (as amended)
 and the relevant provisions of the Companies Act, 1956. The financial
 statements have been prepared on an accrual basis and under the
 historical cost convention. The account- ing policies adopted in the
 preparation of financial statements are consistent with those of
 previous year.
 
 1 Indian Rupee Term loans from Banks (Other than Vehicle loans) are
 Secured by:
 
 i Primary Security:
 
 a Federal Bank Working Capital Term Loan Account No.10357100004284 -
 Pari Passu first charge in favor of State bank of India and Federal
 Bank Ltd. by way of Equitable mortgage of 19.24 acres of land together
 with the buildings and Pari Passu first charge in favour of State bank
 of India and Federal Bank Ltd. by way of hypothecation of entire plant
 and machinery and fixed assets of the Backward Integration Project.
 
 b State Bank of India Term Loan Account no 32331339891 - Paripassu
 First charge in favour of State bank of India and Federal Bank Ltd. on
 the entire fixed assets, present and future, of the Company and
 including:
 
 (i) Extention of Equitable Mortgage over 19.24 acres of Land , Building
 and Plant and Machinery of the Backward Integration Project in Re.Sy
 no. 122/9/4 , 112/5 , 112/1 , 108/2/2 , 108/10/2 , 108/2 , 108/10 ,
 112/4 , 122/9/3 , 108/1/2 , 122/7 ,121/1/1 in Block 27 of Pattimattom
 Village , Kunnathunadu taluk , Puthencruz sub district, Ernakulam
 belonging to the Company.
 
 (ii) Equitable Mortgage over 244.629 cents of Land in Re Sy No 76/3 in
 Block no 27 of Kizhakkambalam, Puthencruz sub district, Ernakulam
 belonging to the Company.(Exclusive first charge to State bank of
 India).
 
 ii Collateral Security:
 
 a Pari-passu Second charge in favor of State Bank of India and Federal
 Bank, on the entire current assets of the Company, both present and
 future.
 
 b Pari-passu Second charge in favor of State Bank of India and Federal
 Bank, on the entire Fixed assets of the Company, both present and
 future other than Fixed assets charged as primary security
 
 c First charge in favor of State bank of India by Equitable Mortgage
 on 3.75 Acres of land & building in Re. Sy No. 81/1 at Pattimattom
 Village, Kunnathunadu Taluk (Kizhakkambalam), Puthen cruz Sub-district,
 Ernakulam belonging to the Company.
 
 1 Terms of repayment of Packing Credits:
 
 Packing credit from Bank is repayable on demand and carries interest @
 7.70%. (Current rate for State Bank of India)
 
 2 Working capital Limits from Bank is secured by
 
 (i) Primary Security:
 
 First charge in favor of State bank of India over the entire Current
 Assets of the Company, both present and future.
 
 (ii) Collateral Security:
 
 Pari-passu Second charge, in favor of State bank of India and Federal
 Bank on the entire Fixed Assets of the Company (excluding vehicles
 purchased under the Hire Purchase), of which includes:
 
 1.  First charge in favor of State bank of India over Equitable
 Mortgage on 3.75 Acres of land & building in Re. Sy No. 81/1 at
 Pattimattom Village, Kunnathunadu Taluk (Kizhakkambalam), Puthen cruz
 Sub-district, Ernakulam belonging to the Company.
 
 2.  Second charge over Equitable Mortgage on 19.24 acres of land,
 building and plant & machinery of the fabric processing plant at
 Kizhakkambalam. (First charge for Federal Bank for their Term Loan
 limit of Rs. 15 Crores and State Bank of India Term Loan limit of Rs 82
 Crores )
 
 3.  Second charge over EM on 244.629 cents of Land in Re Sy No 76/3 in
 Block no 27 of Kizhakkambalam, Puthencruz sub district, Ernakulam
 belonging to the Company.
 
 (iii) Personal Guarantee of Mr. Sabu M Jacob, Managing Director._
 
 COperating Lease: Company as Lessee
 
 The Company has taken various residential and office premises under
 operating lease agreements. These agreements are generally for a period
 of 11 months. The Company has also taken equipments on rent for shorter
 duration during the year. Minimum lease payments charged during the
 year to the Statement of Profit and Loss aggregated to Rs.48,48,342/-
 (Previous year Rs 66,23,419/-)
 
 3.  RELATED PARTY DISCLOSURE
 
 Related parties with whom transactions have taken place during the
 year: 
 
 a Key Management Personnel:
 
 i Sabu M Jacob, Managing Director
 
 ii C Mohan, Whole Time Director (Finance)/Company Secretary 
 
 b Relatives of Key Management Personnel:
 
 i Renjitha Joseph, Wife of Sabu M Jacob
 
 c Enterprise owned or significantly influenced by key management
 personnel or their relatives:
 
 i Kitex Childrenswear Limited
 
 ii Kitex Limited
 
 iii Anna Aluminum Company Private Limited
 
 4.  CONTINGENT LIABILITIES AND COMMITMENTS 
 
 1 Contingent Liabilities (to the extent not provided for)
 
 i Counter Guarantees issued by the Company for the guarantees issued by
 Banks amounts to Rs 2,60,42,612/- (Previous year- Rs. 2,59,35,272/-).
 
 ii Letters of Credit Outstanding amounts to Rs 67,83,62,952/- (Previous
 year - Rs.22,86,55,737/-)
 
 iii Bills discounted - Rs. Nil (Previous year - Rs. 76,63,192/-)
 
 iv Customs, Income tax, Provident Fund and Employee State Insurance
 Claims a Commissioner of Customs issued show cause notice directing the
 company to remit Rs.3,25,20,531/- (inclusive of interest @ 24% as
 applicable) for the financial year 1997-98 towards non-fulfillment of
 export obligation. Company approached settlement commission and
 remitted admitted liability of Rs.1,21,29,942/- during the financial
 year 2001-2002. Settlement commission, issued final order on 03.07.2003
 fixing total duty liability of Rs.2,20,61,171/- and directed the
 company to remit balance amount of Rs.99,31,229/- with simple interest
 at the rate 10% per annum. Aggrieved by the order of settlement
 commission, the company filed writ petition before Humble High Court
 of Kerala, which was dismissed and company has preferred an appeal
 against the same with the Hon Supreme Court . The Company has furnished
 Bank Guarantee for Rs.101.74 lakhs to the Office of the Commissioner of
 Customs.  b The Deputy Commissioner of Income Tax, Aluva has raised a
 demand for Rs.6,29,406/- while completing the assessment for the years
 2003-04 and 2004-05. The demand was dismissed by the CIT (Appeals). The
 Tribunal has dismissed the appeal filed by the Revenue. However, the
 department has preferred an appeal before Hon. High Court of Kerala.The
 company has received a refund of Rs 3,61,732/-,with regard to
 assessment years 2003-04 and 2004-05.  c The Assistant commissioner of
 Income tax, Kochi raised a demand of Rs 21,29,567/- while issuing order
 U/s 154 of the Income tax Act, 1961, for Assessment year 2005-06. The
 company has preferred appeal before the Commissioner of Income tax
 (Appeals).
 
 d For the Assessment year 2008-09 the Company had appealed against the
 Assessment order demand of Rs 3,16,22,680/- with the Commissioner of
 Income Tax (Appeals) and obtained a favorable order dismissing the
 demand. An appeal against this order has been filed by The Assistant
 commissioner of Income tax,(OSD) Kochi at the ITAT Cochin amounting to
 Rs.2,95,83,594/-.The company has already remitted Rs 1,17,57,862/- as
 Self Assessment Tax for the year.  e Asst. Provident Fund Commissioner
 (Enforcement) has determined a sum of Rs.1,31,86,588/- towards
 contributions payable for the period 2001 to 2006 as per the schemes
 framed under Provident Fund Act. Company preferred appeal before
 Provident Fund Appellate Tribunal against the order of Asst. Provident
 Fund Commissioner. Provident Fund Appellate Tribunal directed the
 company to remit Rs.52,74,636/-. Company deposited the amount and since
 the Tribunal order was not in favor of the Company, the Company has
 filed an appeal with the Hon High Court of Kerala and the Proceedings
 have been stayed.
 
 f During the year 1997 the Thahasildar Kunnathunadu Taluk had demanded
 a sum of Rs 3,08,945/- towards one time building tax. The company had
 disputed the applicability of tax on a particular portion of the
 building . The matter is pending before the Hon High court of Kerala.
 g During the year 1999-2000, The Director ,Regional office Ernakulum of
 ESI Corporation has raised demand for Rs.3,66,333/- along with interest
 Rs 2,69,330/- against the Company for the years 1996-97 and 1997-98.
 The Company has disputed the claim and has made a deposit of
 Rs.75,000/- h During the year 2005-06, ESI Corporation has demanded an
 amount of Rs.5,61,692/- lakhs for the years 1998 to 2002. The company
 has disputed the claim and obtained stay from the Hon. ESI Court and
 deposited a sum of Rs.2,15,791/- against the same.
 
 i During the year 2010-11, ESI Corporation, has raised a demand of
 Rs.57,72,341/- for the years from 2003 to 2009. The Com- pany has
 disputed the claim and obtained stay from Hon. ESI Court. The Company
 has deposited Rs.15,00,000/-
 
 2 Commitments
 
 Commitments for Capital Expenditure as on 31.03.2013 in connection with
 the expansion of the Fabric Processing house amounts to Rs
 57,32,77,822/- and other civil works amounts to Rs 2,06,41,434/-. Total
 estimated project cost for the Fabric Processing House expansion is Rs
 1,08,00,20,000/-
 
 5.  IMPAIRMENT OF ASSETS
 
 No material Impairment of Assets has been identified by the Company and
 as such no provision is required as per Ac- counting Standards (AS 28)
 issued by the Institute of Chartered Accountants of India.
 
 6.  PRIOR PERIOD EXPENSES
 
 Import duty of Rs 1,81,60,102/- and Interest thereon of Rs.
 1,20,58,180/- on account of ''Non fulfillment of Export Obligations''
 against licences obtained for duty free import of raw materials during
 earlier years has been accounted under Prior Period Expenses.
 
 7.  DONATIONS
 
 Donations Include payments of Rs 75,000/- made to the following
 political parties - Communist Party of India Marxist, Democratic Youth
 Federation of India , Communist Marxist Party , Indian Communist
 League, Mandalam Congress committee, Pattimattom.
 
 8.  TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND
 PROTECTION FUND
 
 During the year, the company has transferred the unclaimed dividend for
 the year 2005-06 amounting to Rs 1,94,375/- to Investor Education and
 Protection Fund.
 
 9.  PREVIOUS YEAR FIGURES
 
 Previous year figures have been reworked, regrouped, rearranged and
 reclassified, wherever necessary.