1. CORPORATE INFORMATION
Networth Stock Broking Limited (''the Company'') has emerged as a leading
provider of financial services and information provider primarily to
Instititional and Retail clients in India for more than a decade.The
Company is a member of the National Stock Exchange of India Ltd. (NSE)
and BSE Ltd. (BSE) in the Capital Market and Derivatives (Futures &
Options) segment. It is Depository Participants with Central Depository
Services India Limited (CDSL) and National Securities Depository
(India) Limited (NSDL). The Company also provides Merchant Banking
Note: 2 Scheme of Amalgamation
The Board of Directors of the Company at its meeting held on 9th April,
2011 approved the scheme of Amalgamation under Section 391 to 394 of
the Companies Act 1956 of Monarch Research and Brokerage Private
Limited (MRBPL) and Monarch Project and Finmarkets Limited (MPFL) with
the Company with effect from appointed date i.e 1st April, 2010.
The Said scheme is further approved by the Equity shareholders of the
Company at the court conveyed meeting held on 9th April, 2012 as per
the direction of Hon''ble high Court of the Judicature at Bombay vide
its order dated 2nd March, 2012.
NSBL and MPFL has filed petition on 30th April, 2012 with the Hon''ble
High Court of Gujarat at Ahmedabad and the same has been admitted by
the respective High Courts.
The Company has also received no objection /Prior Approval from BSE,
NSE, NSDL, CDSL, USE and SEBI- Portfolio Management Services (PMS)
except from SEBI, MCX-SX and SEBI- Merchant Banker''s Section for the
said Scheme of Amalgamation as on dated on 21s'' September, 2012.
Note: 3 The Company provides for the use by its subsidiaries certain
facilities like use of premises infrastructure and other facilities /
services and the same are termed as ''Shared Services''. The cost of such
Shared Services are recovered from subsidiaries either on actual basis
or on reasonable management estimates which are constantly refined in
the light of additional knowledge gained relevant to such estimation.
Note: 4 Contingent Liability & Commitments (to the extent not provided
The management of the Company does not anticipate any contingent
liability having material effect on the position stated in the Balance
Sheet at the year end except as stated below:
a. Income tax assessment of the Company has been completed upto
assessment year 2008-09. The disputed demand outstanding upto the said
assessment year is Rs. 83 Lacs (previous year Rs. 1101 Lacs). Based on the
decisions of the Appellate authorities and the interpretation of the
other relevant provisions, the Company expects that the demand is
likely to be either deleted or substantially reduced and accordingly no
provision has been made.
b. There are certain claims aggregating to Rs. 489 lacs (previous year Rs.
125 lacs) against the Company for which the Company has taken suitable
legal recourse. Hence the same has not been recognized as a debt and no
provision has been made thereof.
c. The Company has given guarantee of Rs. 5 crores (previous year Nil)
for loan taken by its Subsidiary Company Ravisha Financial Services
Private Limited from financial institutions.
Note: Where, CY= Current year''s figures & PY= Previous year''s figures
Note: 5 The Company has taken suitable legal action for recovering
deposits of Rs. 40 lacs (previous year Rs. 340 lacs) for premises at
Bangalore. The management expects favorable order for the same, hence
no provisions have been made thereof.
Note: 6 The Company has taken suitable legal action for recovering
debts of Rs. 239 lacs (previous year Rs. 239 lacs) for fraudulent
transaction done by client in the year 2008-09. SEBI has passed the
interim order withholding the payout which is kept with BSE till
completion of investigation. The management expects favorable order for
the same, hence no provisions have been made thereof.
Note: 7 In the opinion of the Directors of the Company, the Current
Assets and loans and advances have a value on realization in the
ordinary course of business at least equal to the amount at which items
are stated in the Balance Sheet.
Note: 8 There are no Capital commitments which is outstanding as on
Balance Sheet date (previous year Nil).
Note: 9 Events Occurring After the Balance Sheet Date
To the best of knowledge of the management, there are no events
occurring after the Balance Sheet date that provide additional
information materially affecting the determination of the amounts
relating to the conditions existing at the Balance Sheet Date that
requires adjustment to the Assets or Liabilities of the Company.
Note: 10 The Revised Schedule VI has become effective from 1st April,
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