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Moneycontrol.com India | Notes to Account > Textiles - Spinning - Cotton Blended > Notes to Account from Volant Textiles - BSE: 531865, NSE: N.A
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Volant Textiles
BSE: 531865|ISIN: INE962D01025|SECTOR: Textiles - Spinning - Cotton Blended
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Volant Textiles is not listed on NSE
Mar 12
Notes to Accounts Year End : Mar '13
BACKGROUND & NATURE OF OPERATIONS:
 
 Volant Textile Mills Ltd (''The Company'') is engaged in the business of
 Textiles. The principal activity of the company is manufacture of Gery
 Fabrics & Trading of textiles and textiles products.
 
 1) The accumulated losses of the Company exceed its net worth. However
 these accounts have been prepared on a going concern basis as the
 management believes that the company will be able to meet all its
 liabilities on the financial support from its Promoters/ Directors who
 have agreed to provide all the necessary financial support time to
 time.
 
 Accordingly these financial statements do not include any adjustments
 relating to the recoverability and classification of the carrying
 amount of Assets or the amount and classification of Liabilities that
 might have to be done should the company be unable to continue as Going
 Concern.
 
 2) Contingent Liabilities not provided for:
 
 i. Aggregate Central Excise duty of Rs 151.52 lacs and Rs 4.88 lacs
 demanded by the respective authorities are disputed amounts and not
 acknowledged as debts. In the opinion of the management these demands
 are not payable, as the company has preferred an appeal against them.
 The same shall be charged to revenue in the year the demands are
 determined and paid. The company has made a deposit of Rs. 15.00 lacs
 and Rs. 1.00 lac with the Central Excise for pursuing the appeal.
 
 ii. Company has filed appeal against the decision of High Court before
 the Provident Fund Tribunal, Delhi. Tribunal Authority directed to pay
 Rs. 2 Lacs on the condition for submission of appeal. Accordingly
 Company paid and appeal is admitted.
 
 iii.In respect of pending assessments with the Government bodies and
 authorities, amounts payable towards additional demands, interest and
 penalty, if any, shall be charged to revenue account in the year in
 which such demands materialize and is paid, the amount being
 unascertainable.
 
 iv. The Company has an Export Obligation on duty free imports the
 details of which are as follows:
 
 a) Rs.  82,79,368/- equivalent to USD 1,73,028 to be completed by
 13.10.2012.
 
 b) Rs. 1,95,04,095/- equivalent to USD 4,81,582 to be completed by
 02.06.2016.
 
 c) Rs. 1,64,47,903/- equivalent to USD 3,80,739 to be completed by
 04.09.2016.
 
 The Company has already completed the required exports against the
 licences mentioned above and are in the process of getting the licences
 closed. The Company has already received from DGFT the permission for
 closure of licence mentioned in point (a & c) and has applied to the
 customs for release of the guaranty provided to them. Permission from
 DGFT is awaited for the licences mentioned in point (b).
 
 3) Assets aggregating to Rs.60.14 Lacs were acquired on lease for five
 years. The lease period has expired on 31.12.2002. Moreover, the
 company has to pay Rs.82.87 Lacs to the lessor as on 31.3.2004. The
 lessor has also filed a case against the company for non-payment of
 lease rent in time. Any additional interest and/or penalty for delay in
 making lease rents shall be charged to revenue in the year of payment,
 the amount being unascertained, no provision for the same is made. The
 company has not yet been able to settle with the lessor as part of the
 restructuring exercise.
 
 4) The balances of secured and unsecured loans, sundry debtors, sundry
 creditors, current liabilities, loans, and advances are subject to
 confirmation and reconciliation. Adjustments, which may arise on
 receipts of confirmation and completion of reconciliation, are not
 ascertainable at this stage.
 
 5) The Company used to adjust the foreign currency exchange rate
 differences on amounts borrowed for acquisition of fixed assets, to the
 carrying cost of fixed assets in compliance with Revised Schedule VI to
 the Companies Act, 1956 as per legal advice, which was at variance to
 the treatment prescribed as per Accounting Standard 11.
 
 6) Segment information:
 
 a) Primary Segment.
 
 In accordance with Accounting Standard 17 Segmental Reporting issued
 by the Council of the Institute of Chartered Accountants of India, the
 Company has determined its business segment as manufacturing of grey
 fabrics. There are no other primary reportable segments.
 
 7) The Company has accumulated losses which have exceeded the networth
 of the company. The company has been declared sick by BIFR vide its
 letter dt. 1.3.2006 having case No. 322/02 on directive of AAIFR. Bank
 of Baroda has been appointed as the Operating Agency, and have already
 submitted a revised rehabilitation scheme to the Hon''ble BIFR. The
 accounts are prepared on a going concern basis.
 
 8) Taxation:
 
 No provision of Income Tax has been made as the Company is registered
 with BIFR and is not required to pay MAT under Section 115-JB of the
 Income Tax Act as the said section is not applicable to a Company
 registered with BIFR and having negative net worth on the opening day
 of the financial year. Moreover, the auditor has relied upon the
 opinion produced by the Management of the Company, in the matter.
 
 9) Employee Benefit:- i. The liability for compensated absence carried
 forward on the balance sheet date is provided
 
 by the management. The Company has made a provision for leave pay to
 Rs. 2.46 lac (previous year of Rs. 2.41 lacs).
 
 ii. During the year company makes annual contribution to a Gratuity
 Fund administered and managed by the Life Insurance Corporation of
 India. The company accounts its liability for gratuity benefit based on
 valuation done by LIC as at balance sheet date. The company paid annual
 contribution to Gratuity fund of Rs. 0.99 lacs in current year
 (previous year gratuity provided of Rs. 0.15 lacs). Total amount
 deposited with LIC is Rs. 2.84 lacs (previous year of Rs. 1.85 lacs).
 
 10) Loans and Advances include Rs.54.04 lacs (previous year 41.83 lacs)
 recoverable from various government authorities towards refund of
 electricity duty, CST and VAT. The management is pursuing the matter
 and is hopeful of recovering the same
 
 11) The accounts have not been authenticated by a whole-time company
 secretary as the Company does not presently have a whole-time company
 secretary as required by Section 383 A(1) of the Act.
 
 12) The Company has incorporated a subsidiary company named M/s Force
 Protective Solutions Pvt.  Ltd. during the year and hence disclosure in
 respect of Loans and Advances pursuant to Clause 32 of the Listing
 Agreement is applicable to the Company.
 
 The financial statements of the subsidiary company alongwith directors''
 report, auditor''s report, summary of significant accounting policies
 and other explanatory information are attached.
 
 13) The amount transferred to investor and education fund Rs. Nil
 (Previous year Rs. Nil).
 
 14) The Company does not possess information as to which of its
 suppliers is Small Scale Industrial Undertakings holding permanent
 registration certificate issued by the relevant authorities.
 Consequently, the liability, if any, of interest which would be payable
 on delayed payments under Small Scale and Ancillary Industrial
 Undertakings Act, 1993, of India cannot be ascertained.  However, the
 Company has not received any claim in respect of such interest. In view
 of the above, outstanding dues to Small Scale Industrial Undertaking
 cannot be ascertained.
 
 15) Figure for previous year have been regrouped/rearranged wherever
 necessary.
Source : Dion Global Solutions Limited
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