1. From District Industries Centre, Tamil Nadu (The loan is an interest
free sales tax loan secured by simple mortgage on land & building both
present & future situated at A9, A10, A11 & A24, SIDCO Industrial
Estate, Maraimalai Nagar, Chengleput, Tamil Nadu and on all the
machinery present and future erected and to be erected on the above
said land & building. Mortgage and charge shall rank PARIPASU with
mortgage and charges created in favour of State Bank of India in
respect of loans granted by them as detailed).
2. Contingent Liabilities not provided for :
a. Estimated amount of contract remaining to be executed on Capital
Account is (Previous year Rs. 1,47,060/-)
b. Counter Guarantees given by the Company against guarantees given by
bankers. (Previous year Rs. 24,72,651/-)
c. Letters of Credit established by Bankers favouring suppliers.
(Previous year Nil)
d. Claims against the Company not acknowledged as debt :
i. Suit filed by M/s. Scanchem A/S, Denmark for the recovery of USD
1,79,174.30 equivalent to Rs. 78,47,834/- (1 USD = Rs. 43.80) not
accepted by the company in view of the defective quality of materials
supplied (Previous year Rs. 76,18,491/-)
ii. Claims against the Company not acknowledged as debt :
a. Disputed availment of MODVAT credit for the year 1996-97 (Previous
year - Rs. 4,35,852/-)
b. Disputed demand of Excise Duty for the year 1998-99 (Previous year -
c. Disputed availment of MODVAT credit for the year 1998-99 (Previous
year - Nil)
d. Disputed duty on reprocessing loss of 5% Platinum on Carbon for the
year 1998-99 (Previous year - Nil)
3. The Company is manufacturing only one class of goods viz., bulk
drugs and purchases one class of raw materials viz., chemicals. The
quantitative figures are given below :
4. The company has created a Trust which has taken a group gratuity
policy with the Life Insurance Corporation of India for future payments
of retiring gratuatants. The premium thereon have been so adjusted as
to cover the liability in respect of all employees at the end of their
future anticipated service with the company.
5. Subject to confirmation from parties, balances of Sundry Debtors,
Advances and Deposits, Sundry Creditors and Unsecured Loans, have been
incorporated in the accounts as per the balances appearing in the
6. In the absence of confirmation from the Creditors as to their SSI
status, the Company is unable to classify their outstandings in the
current year. Steps are being taken to ascertain the status of the
Creditors. The Company being sick industrial undertaking is unable to
gather the particulars.
7. The application to Board for Industrial and Financial Reconstruction
(BIFR) dated 11.12.97 has been approved and the State Bank of India has
been appointed as Operating Agency. The revival package submitted to
them has been appraised and the report has been submitted by the
Operating Agency. The report of Operating Agency i.e., SBI was
negative and the same is objected to by the Company and an independent
consultants with the approval of SBI have been appointed to submit a
Techno Economic Viability Report. They submitted the said report and
the same has been submitted before the BIFR which is pending
8. Interest to the extent of Rs. 84 Lacs (Previous periods Rs. 178.54
Lacs) on Secured Loans. from State Bank of India has not been provided
in the accounts. Consequent to that, the loss is understated to the
extent of Rs. 84 Lacs (Previous periods Rs. 178.54 Lacs) and
liabilities to the Bank understated to that extent. However, the
Company has submitted proposals for One Time Settlement (OTS) which is
under the Bank's consideration.
9. Interest to the extent of Rs. 31,56,239/- (Previous periods Rs.
81,44,5787-) on Unsecured Loans has not been provided in the accounts.
Consequent to that, the loss is understated to the extent of Rs
31,56,239/- (Previous, periods 81,44,578/-) and liabilities to
Creditors understated to that extent.
10. Limits for acceptance of Public Deposits - Nil. All public
deposits accepted and outstanding have fallen due but not paid as on
March 31,2000. These deposits were accepted at the time when the
Company had permissible limits and interest accrued, due and not paid
are added to the respective depositors' account. These deposits were
since repaid in full.
11. Unsecured Loans - Others Rs. 80,92,0121- represents inter-corporate
loans. (Previous year Rs. 2,77,19,362.30)
12. Miscellaneous Expenditure to the extent not written off Rs.
11,99,476.80 represents share issue expenses incurred in connection
with Rights Issue (Previous year Rs. 11,99,476.80)
13. The prior period transactions (NET) consist of the following :
a. Liabilities no longer
required written back (Net) (Cr) Rs. 54,46,936/-
b. Interest on Unsecured
Loans (Dr) Rs. 27,32,591/-
(Previous year (Dr) Rs. 10,63,154/-)
14. Copenhagen Branch Account : The Branch is being continued for
collection of Debtors and R.B.I, renewal permission has not been made.
The branch accounts have been audited upto 30.09.98 and audited
statements received at head office. The audit of the branch accounts
for the period from 01.10.98 to 31.03.2000 have not been conducted. In
the absence of audited statement of accounts for the branch for the
year ended 31.03.2000, the accounts have been prepared based on the
information available at head office and they are incorporated in the
Balance Sheet and Profit and Loss Account. In view of the status of
the branch as explained above, the exchange rate adopted for
translation of outstanding balances is continued as per the rate as on
31.03.98 i.e., 1 US $ = Rs. 39.28.