Uttam Galva Steel

1.0 Previous Years figures are regrouped and rearranged wherever
 necessary.
 
 2.0 Contingent Liabilities not provided for in respect of:
 
 2.1                                31st March 2009     31st March 2008
                                         Rs. Crores          Rs. Crores
 
 (a) Letters of Credit outstanding           600.56              412.90
 (b) Bank Guarantees                          47.25               14.61
 (c) Estimated amount of contracts 
 remaining to be executed on capital 
 account and not provided for                115.00              104.00
 (d) Bills Discounted                           NIL                0.04
 
 2.2 The Company had given a corporate guarantee of Rs. 70 Crores to
 Commissioner of Customs against export obligation of Uttam Galva
 Metallics Limited.
 
 3.0 (a) The Company does not have taxable income as per the provisions
 of the Income Tax Act, 1961, except MAT liability.
 
 (b) The Income Tax Assessment is completed upto 31st March, 2005. i.e.
 Assessment Year 2005-06.
 
 (c) The Sales Tax Assessments are completed upto 31st March, 2008.
 
 (d) The Company does not expect any liability on remaining
 assessments/appeals.
 
 4.0 Pursuant to revision of Accounting Standard 11 (AS 11), exchange
 fluctuation loss of Rs. 50.04 Crores (net of previous year gain of Rs.
 15.42 Crores) on Foreign Currency Loans is adjusted against cost of
 relevant fixed assets.
 
 5.0 Deferred Tax Accounting:
 
 As per the provisions of Income Tax Act, 1961 the Company has
 unabsorbed depreciation. As a conservative business policy, the Company
 has not recognised the same as Deferred Tax Asset.
 
 5.1 During the year the Company has recognised ‘MAT Credit Entitlement
 to the sum of Rs. 10.85 crores (Previous Rs. 14.09 crores) pertaining
 to MAT payment for the current year.
 
 6.0 During the year, the Company decided to prepay taxes payable under
 Deferral Sales Tax scheme, Against the Deferral Sales Tax liability of
 Rs. 61.24 crores for period upto March 2008. The Company has prepaid
 Rs. 19.72 crores; at net present value as prescribed and consequential
 balance of Rs. 41.52 crores is treated as sales. This credit has
 accrued and arisen during the financial year 2008-09.
 
 7.0 Total expenditure includes cost of sales, Rs. 957.48 Crores,
 (Previous year 953.39 Crores) related to goods produced during trial
 run. Excess of expenditure over sale realisation is capitalised.
 
 8.0 The Company has provided for Unclaimed Leave Encashment Benefits as
 at 31st March, 2009 to the tune of Rs. 2.32 crores.
 
 9.0 (a) During the year, the Company has ceased to be a holding Company
 of MKR International Limited, a wholly owned subsidiary incorporated in
 British Virgin Island (BVI).
 
 (b) During the year, Uttam Galva Holdings Limited, a wholly owned
 subsidiary has been incorporated at Dubai U.A.E.
 
 There are no operations/transactions in the Company except the
 administrative cost of 127,550 Dirham (INR 0.18 Crores).
 
 10.1 Merger of Power Division of Shree Uttam Steel and Power Limited
 (SUSPL) with the Company Power Division of Shree Uttam Steel and Power
 Limited (SUSPL) has been merged with the Company. The Scheme of
 Arrangement was sanctioned by the Honble High Court of Judicature at
 Bombay vide Order dated August 7, 2009 and by the Honble High Court of
 Bombay, Goa Bench at Goa vide Order dated August 17, 2009. The Scheme
 became effective on August 21, 2009 by filing of high court orders with
 respective Registrar of Companies, the Appointed Date of the Scheme of
 Arrangement being April 1, 2008.
 
 Pursuant to the Scheme:
 
 i) The assets, liabilities, rights and obligations of erstwhile Power
 Division of SUSPL has been vested with the Company with effect from 1st
 April, 2008 and have been recorded at their respective fair value,
 under the purchase method of accounting for merger.  In pursuant to the
 said scheme, following assets and liabilities of SUSPL have been taken
 over by the Company.
 
                                                       (Rs. in Crores)
 
 Land                                                           29.95
 Vehicle                                                         0.07
 Gross Fixed Assets                                             30.02
 Less: Depreciation                                              0.01
 Net Fixed Assets                                               30.01
 Capital Work in Progress                                        0.01
 Cash & Bank Balances                                            0.05
 Loan and Advances                                               0.10
 Current Liabilities                                             0.08
 
 ii) 58,74,760 Fully Paid Equity Shares of Rs. 10/- each of the Company
 to be issued to the shareholders of SUSPL (i.e.  51,25,000 Equity
 Shares to Equity Shareholders and 7,49,760 Equity Shares to Redeemable
 Preference Shareholders) without payment being received in cash.
 Pending allotment, the face value of such shares has been shown as
 Equity Share Capital Suspense Account.
 
 iii) Excess of the fair value of net assets taken over by the Company
 over the paid-up value of equity shares to be issued and allotted (as
 referred to under (iii) above), amounts to Rs.  24.23 crores and the
 same has been credited to Securities Premium Suspense Account.
 
 10.2 The Board of Directors had approved the audited accounts on 9th
 May, 2009, subject to the sanction of Scheme of Arrangement between
 SUSPL and UGSL filed with the High Court of Judicature at Bombay and
 High Court of Bombay, Goa Bench at Goa. Now the Company has received
 the sanctions and accounts are appropriately revised to give effect of
 orders passed by High Court of Judicature at Bombay and High Court of
 Bombay, Goa Bench at Goa as mentioned in 10.1 above.
 
 11.0 (a) List of Related Parties with whom the Company have entered
 into transactions during the year in the ordinary course of business:
 
 (i) Key Managerial Personnel:
 
 Mr. Rajinder Miglani
 
 Mr. Praveen Miglani
 
 Mr. Anuj Miglani
 
 Mr. Ankit Miglani
 
 Note: Details relating to remuneration to the above key management
 personnel have been disclosed in Note No. 17(a).
 
 (ii) Other Related Parties:
 
 (Associates of the Company/Enterprises over which key management
 personnel and/or their relatives exercise significant influence)
 
 Wholly Owned Subsidiary: Uttam Galva Holding Limited
 
 Joint Venture:
 
 Texturing Technology Private Limited
 
 Associates:
 
 Growell Mercantile Private Limited
 
 Shree Uttam Steel and Power Limited
 
 Uttam Galva Metallics Limited
 
 Uttam Biotechnology Park Infrastructure Private Limited
 
 Uttam Distribution Network Limited
 
 Uttam Flour Mills Private Limited
 
 Uttam Galva International Limited
 
 Uttam IT Park Projects Private Limited
 
 Uttam Utkal Steels Limited