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| Notes to Accounts | Year End : Mar '08 |
1 NOTES CONCERNING AMALGAMATION 1.0 Scheme of Arrangement (Scheme) - The Scheme sanctioned by Honble High Court of Delhi is for the amalgamation of the Usha International Ltd. (UIL -Transferor Company No. 1) and Shriram Fuel Injection Industries Ltd. (SFIIL-Transferor Company No. 2) with the Jay Engineering Works Ltd. (JEW - Transferee Company) The products manufactured by JEW as well as SFIIL are marketed mainly through UIL and thus there is synergy of business interest between the three Companies. Accordingly, their businesses are combined conveniently/ advantageously and would enure for the benefit of the Shareholders, the employees and all the stakeholders of all the three Companies. 2.0 SalientfeaturesoftheSchemeare: 2.1 The name of the Transferee Company The Jay Engineering Works Limited shall stand changed to Usha International Ltd. 2.2 The Scheme would be operative from the Appointed Date, i.e. 01.04.07 and would be effective from the date on which copies of the order of Honble High Court of Delhi sanctioning the Scheme has been filed with the Registrar of Companies, NCT of Delhi and Haryana. 2.3 Authorised Share Capital of the Transferee Company would be sum total of the Authorised Share Capital of all the three Companies. 2.4 Based on the business valuation of JEW, UIL and SFIIL, Equity Shareholders of UIL would get 44 Equity Shares for every 1 Equity Share held in UIL and Equity Shareholders of SFIIL would get 31 Equity Shares for every 10 Equity Shares held in SFIIL of the Transferee Company after canceling the crossholdings. Accordingly, Equity Share Capital of the Transferee Company would become Rs. 110,74,31,930 comprising of 11,07,43,193 Equity Shares. The Scheme provides for the reduction in the issued and paid up Equity Share Capital by canceling of 9,96,68,873 Equity Shares of Rs. 10/- each and the amount of Rs. 99,66,88,730 would be credited to General Reserves and will not be paid to the Shareholders. Accordingly, Equity Shares would be allotted to the Shareholders of all the three Companies as on the Record Date as under:- 44 New Equity Shares of Rs 10/- each fully paid -up of Transferee Company for every 10 Equity Shares of Rs 10/- each fully paid-up held in Transferor Company No.1, i.e. UIL. 31 New Equity Shares of Rs 10/- each fully paid -up of Transferee Company for every 100 Equity Shares of Rs 10/- each fully paid-up held in Transferor Company No.2, i.e SFIIL. 1 New Equity Share of Rs 10/- fully paid -up of Transferee Company for every 10 Equity Shares of Rs 10/- each fully paid-up held in Transferee Company, i.e. JEW. New Equity Shares allotted after cancellation of cross holdings of each Company are as under- Erstwhile Usha International Limited (Transferor Company No 1) : 100% Erstwhile Shriram Fuel Injection Industries Limited (Transferor Company No 2) : 34.16% Erstwhile The Jay Engineering Works Limited (Transferee Company) : 10.61% 2.5 The incidence of adopting uniform Accounting Policies, if any, would be quantified and adjusted in the Revenue Reserves. 2.6 All Assets, Liabilities, Rights and Obligations of Transferor Companies No. 1 and 2 would vest with the Transferee Company at Book Value as on the Appointed Date, i.e. 1.4.2007. 3.0 The Scheme of amalgamation has been sanctioned by Hon able High Court of Delhi vide its Order dated 26.5.2008.The scheme became effective on 2.6.2008, the Appointed Date of the Scheme being 1st April 2007. The Name of The Jay Engineering Works Ltd. has been changed to Usha International Ltd and New Equity Shares have been allotted to the Shareholders on 25.06.2008. 3.1 The accounts of the Company have been prepared following the principles and procedures of the Pooling of Interest Method of Accounting for Amalgamation as per Accounting Standard - 14. 3.2 The difference of Rs. 10353.44 lacs between the Equity Share Capital allotted to the Shareholders of both the Transferor Companies after cancellation of cross holdings and their Equity Share Capital prior to Amalgamation has been adjusted in General Reserve. OTHER NOTES 4.0 As per Accounting Standard 15 Employee Benefits, the disclosures of Employee benefits as defined in the Accounting Standard are as below :- 5.0 Provision for Income Tax The amalgamated company Usha International Limited (Formerly known as The Jay Engineering Works Limited) intends to file its Income Tax Return based on amalgamated accounts. Accordingly in view of the carry forward losses (including unabsorbed depreciation) the Company is liable to tax under section 115JB of the Income Tax Act, 1961. 6.0 Deferred Tax Assets/Liabilities Deferred Tax Assets (net) amounting to Rs. 452.44 Lacs has been computed on the date of Balance Sheet subsequent to amalgamation and includes Rs. 241.41 Lacs (MAT) as per Section 115 JB of the Income Tax Act 1961. 7.0 The management is of the opinion that there is no impairment of Assets as contemplated in Accounting Standard-28. Fixed Assets retired from active use and awaiting disposal - Rs. 3.02 lacs (PY Rs. 3.02 lacs). The Company is of the view that the realization against these Assets would be higher than the above amount. 8. Balance with certain suppliers await reconciliation and confirmation. 9. Previous Year Figures are on stand alone basis of the Transferee Company and are, therefore, not comparable with the figures of Current Year and have been reworked, regrouped, rearranged and reclassified wherever necessary. |
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| Source : Dion Global Solutions Limited | |
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