1) Term Loans from the Financial Institutions it Hanks are Secured by
first charge, ranking pari-passu, interse by way of Joint Equitable
Mortgage of all immovable properties situated at Plot No. A-l & B-l.
Muni-Ki-Reti. Industrial Area, Village Dhalwala, District Tehri Garhwal
(U. P.) and hypothecation of whole of the movable properties of the
Company including Plant & Machinery, Equipments, Fittings, Spares,
Accessories and other movable (Save and except Book Debts), both
present and future, subject to prior charges created and or to be
created in favour of the Company's Bankers on specific movable lor
securing borrowing for working capital requirement.
2) Additional Term Loans from ICIC1 and IDBI under balancing scheme arc
further secured by the personal guarantees of Sh. H. C. Goyal Managing
Director. Sh. Amrit Goyal- Joint Managing Director and Sh. Ashok Goyal
- Director of the company & corporate guarantee of RMI Cycles Limited.
3) Other Loans being cash-credits from State Bank of India & State bank
of Patiala are secured by hypothecation of Stocks. Books Debts, Stores
and other Current Assets and also by second charge by way of equitable
joint mortgage of all immovable properties situated at A-1 & B-1. Muni
ki Reti, Industrial Area, Village Dhalwala,. Dist. Tehri Garhwal U. P.
& hypothecation of whole of movable properties of the company including
Plant and Machinery. Equipments, Fittings, Spares Accessories and other
movable assets, both present and future. These loans arc further
secured by personal guarantees of Sh. H. C. Goyal- Managing Director,
Sh. Amrit Goyal- Joint Managing Director and Sh. Ashok Goyal- Director
explanation given to us. except the transaction for sale of goods there
was no other transaction for purchase of goods and material and sale of
material and services aggregating during the year to Rs. 50,000/- or
more in respect of each party in pursuance of contracts or arrangement
entered in the Register maintained under Section 301 of the Companies
Act. 1956. The transaction for the sale of goods have been made at
price winch are reasonable having regard to the prevailing market price
for such goods or the prices at which similar transaction have been
made with other parties.
1. Contingent Liabilities not provided for on account of:-
a) Estimated amount of contracts remaining to be executed on Capital
Account and not provided for, Rs. 8,18,527/- (Previous year Rs.
b) Bills and Cheques discounted with Bank Rs. 69,56,544/- (Previous
year Rs. 85,76,918/- only)
c) Liabilities of Rs. 38,60,294/- in case of non-fulfilment of export
obligation against the Duty Free Imports made under Advance Licences.
The said liability does not include the amount of interest, if any,
payable in case of failure.
d) Claims not Acknowledged as Debt:-
i. Rs. 32,92,620/- (Previous year Rs. 32,92,620/-) to UP State
Industrial Development Corporation Limited, on account of enhancement
of rates for Lease hold land allotted The matter is pending before
Hon'ble High Court. Aforesaid liability for enhanced value does not
include the amount of interest if any, payable to UPSIDC.
ii. Legal suits filed by customers not provided for Rs. 4,80,000/-
(Previous Year Rs. 4,80,000/-)
iii. Disputed penalty under Excise pending in appeal Rs. 2,40,000/-
(previous year Rs. 2,40,000/-).
iv. Disputed Income-tax liability under appeal Rs. 3,84,257/- (Previous
year Rs. Nil)
v. Disputed Liabilities under Trade-tax pending in appeals Rs.
89,99,214/- (previous year Rs. 3,25,207/-).
vi. Disputed demand of UPSEB for Rs. 56821/- towards its establishment
charges 2. Sundry Debtors include Rs. 464.45 Lacs (Previous year Rs.
154.87 Lacs) due on account of goods sold to RMl Cycles Limited, a
Company under the same Management.
2. Net Gain on account of Exchange Differences charged to the Profit &
Loss account Rs. 4.72,578/- (Previous Year Rs. 22,900/-)
3. Loan to company for Rs. 50 lacs as appearing in Schedule B
represents loan given to RMl Foods Limited, a company under the same
management. Further 'Advances recoverable in cash or in kind also
include a sum of Rs. 45,80,822/- (previous Year Rs. 35,55,822/-)
recoverable towards interest on the above loan.
4. In the opinion of the Board and to the best of their knowledge and
belief, the value on realisation of current assets, loans and advances
in the ordinary course of business subject to amounts considered
doubtful of recovery would not be less than the amount at which they
are stated in the Balance Sheet.
5. Figures in Brackets pertains to-previous year.
6. The Value figures have been Rounded-off to the nearest thousand
rupees and the quantitative figures have been Rounded-off to the
nearest M. T.
7. Balances of parties appearing under Sundry Debtors, Sundry
Creditors, Advances to Suppliers and others including debit notes
raised on them for rate differences, interest on outstanding and other
claims are subject to confirmations. The adjustment, if any, on
confirmation/reconciliation shall be made in subsequent year, the
effect thereof on assets, liabilities and loss for the year cannot be
8. Provision for doubtful debts aggregating to Rs. 61,82,835/- has
been made for the year in respect of certain debts under
9. Interest for the year amounting to Rs. 48,39,304/- (Previous year
Rs. 46,67,017/-) on term loans from Financial Institutions have been
provided on simple rate of interest instead of compound basis. Further
no provision for penal interest leviable for nonpayment of principal
and interest dues have also been made. Management of the company is
fully confident that provision of acrued interest liability on the
basis of simple interest, method, shall be sufficient enough to meet
the liability for interest payable at the time of final settlement. Had
the interest was provided on compound basis with penal interest, as
provided under the loan agreements, the liability for the year on
account of interest would have been higher by Rs. 40,52,819/- (Previous
year Rs. 25,92,799/-) and losses for the year would have been higher
to the same extent. Accumulated Liability towards compound interest and
penal interest not provided for upto 31.03.2001 works out at Rs.
82,32,410/- (Previous year Rs. 41,79,591/-) and losses of the company
are lower to this extent.
The Management has already requested the lead Financial Institution for
charging of interest on outstanding loans at concessional rate and also
for waiver off all the liability towards penal interest.
10. No amount is due to Small Scale Industrial Undertaking (SSI).
11. Figures for the previous years have been regrouped, rearranged and
reclassified, wherever necessary to make them comparable.