a Unsecured Loans from others
1) Interim dividend on Preference Shares and tax thereon and proposed
dividend on equity shares and tax thereon is out of opening surplus.
1. Term loans from IFC, Washington, Barclays Bank PLC & ICICI Bank
Ltd., are secured by way of hypothecation on all movable assets both
present and future and are secured by equitable mortgage of immovable
assets , both present and future on pari-passu basis
2. Loans from State Bank of Mysore are secured by second charge on plant
and machinery acquired / to be acquired under the project whereas loan
against Cenvat Receivables is also secured by hypothecation of the
3 Interest free loan under Sales Tax Defferal Scheme availed from
August 1994 to July 2006 of Rs.66.88 Crores is being repaid in 12
installments of Rs.5.57 Crores payable yearly starting from August
2006. (Balance outstanding - Rs.3344.10 lacs)
Interest free loan under Sales Tax Defferal Scheme is being availed
from June 2002 for a period of 12 years up to May 2014 and will be
repayable in 12 installments on a year to year basis from 2014 to 2025.
(Balance outstanding - Rs.8806.43 Lacs)
4 There is no default in repayment of loans and interest.
1.2 FIXED ASSETS
1) Buildings are constructed on leasehold land for which the Company
parts only ground rent except Non-factory buildings worth Rs.188.03
Lakhs (Rs.188.03 Lakhs) being the cost of ownership premises.
2) Leasehold Land represents the amount paid to Karnataka Industrial
Area Development Board, Bangalore against allotment of land at
Industrial Area, Mysore and Kesarolli village, Haliyal on Lease-
cum-sale basis for a period of 11 years.
3) During the current period, foreign exchange fluctuation loss
amounting to Rs.10049.27 lakhs has been capitalized to the block of
Plant & Machinery pursuant to notification No.G.S.R. 913 (E) dated
29.12.2011, applicable upto March 31, 2020.
4) Sales / Adjustments includes subsidy of Rs.50.00 Lakhs received from
Government of Karnataka for Effluent Treatment Plant and impairment
loss of Rs.102.59 Lakhs on Plant & Machinery which are reduced from
their respective blocks.
5) The Company has not incurred any capital expenditure for Research &
Development during the year (Previous Year - Rs.15.45 lacs).
[All amounts in Rupees Lakhs, except share data and unless otherwise
1.2 CONTINGENT LIABILITIES AND COMMITMENTS
I. Contingent Liabilities & Commitments
a Guarantees Issued by Banks 2,892.45 3,599.66
b Letters of Credit outstanding 1,921.58 2,685.24
c Corporate guarantee given to the Banks
& Institutions on behalf of related
party - Rama Newsprint & Papers Limited. 19.720.23 12.067.54
II. Claims against the Company not
acknowledged as debts in respect of
a Income tax matters, pending decisions
on various appeals made by the Company
and by the Department (refer notes below) 9,606.00 5,518.65
matters & Service Tax under dispute 26.24 13.75
c Sales Tax matter, under dispute 30.66 30.66
cl Other matters, under dispute 2,100.00 2,100.00
III. Estimated amount of contracts
remaining to be executed on Capital
account and not provided for
(net of advance) 293.73 1,520.36
1 The Income tax assessments of the Company have been completed upto
Assessment Year 2009-10.
2 The Total demand outstanding as on 31.03.2012 on account of income
tax dues for various assessment years is Rs.9606 lacs (Rs.5518.65
lacs). The Company and the Income Tax Department are in appeal before
the Appellate authorities for various assessment years. Since most of
the issues raised in these years are already covered by the decisions
of Hon''ble Income Tax Appellate Tribunal and CIT(A) in Company''s
favour, the Company is of the opinion that the demands are likely to be
either deleted or substantially reduced in appeal before appellate
authorities and in view of this, the Company has decided to adjust the
short/excess provision, if any, after the appeals are disposed off.
3 The Company and the Income Tax Department are in appeal before the
High Court of Bombay on various grounds decided by the Income Tax
Appellate Tribunal. The Company has therefore not recorded adjustment
of Taxes in the books.
1.3 RELATED PARTY DISCLORUES
a. Related parties where control exists or where significant influence
exists and with whom transactions have taken place during the year :
1 Fort Gloster Industries Ltd., Kolkata (FGI)
2) Rama Newsprint & Papers Limited (RNPL) Enterprises where principal
shareholders have control
1) Veer Enterprises Ltd.
2) Shree Satyanarayan Investment Company Ltd.
3) Siddhi Trade & Holdings Pvt.Ltd.
4) Rangnath Bangur Charitable Trust
Key Management Personnel represented on the Board
1) Shri S.K.Bangur, Chairman & Managing Director
2) Shri K. L.Chandak, Executive Director Non-Executive/Independent
Directors on the Board
1) Shri R.N.Mody
2) Shri C.K.Somany
3) Shri P N Kapadia
4) Lt.Gen.fRetd.] Utpal Bhattacharyya
5) Shri Krishna Kumar Karwa
6) Shri Sanjay Kothari
7) Shri M P Taparia
8) Shri Saurabh Bangur
9) Smt Shashi Devi Bangur
1.4 SEGMENT INFORMATION
The Company is in the business of Manufacture & Sale of Paper and Paper
Boards & Duplex Boards. Considering the core activities of the Company,
management is of the view that manufacture and sale of Paper and Paper
Boards & Duplex Boards is the only reportable business segment and
hence information relating to primary segment is not required to be
1.5 NOTE ON DEPRECIATION
During the current year company has retrospectively changed the method
of providing depreciation on New Fibre Line & Chemical Recovery Island
from Straight Line Method to Written Down value Method due to
technological changes. Differential depreciation of earlier years
amounting to Rs. 6219.78 Lacs (shown as an exceptional items) and that
of current year of Rs. 4216.42 Lacs is charged to Profit & Loss Account
for the year due to which the loss for the current year has been
overstated to that extent.
1.6 The Company had paid an amount of Rs. 362.22 lacs towards the
invocation of Bank Guarantee given to a Bank on behalf of Speciality
Coatings and Laminations Ltd (SPCL).The Company has also to recover Rs.
27.41 lacs against supplies made to SPCL. The Company is hopeful of
recovering the said amount out of disposal of the assets of SPCL and
hence, no provision has been made in the books of accounts.
1.7 The Company has investment of Rs. 4540.86 lacs in Rama Newsprint &
Papers Ltd. (RNPL). At the year end there has been substantial
reduction in the market value of this investment by Rs 2895.24 lacs.
The company has not made any provision towards the diminution in value
as said investment is a long term trade investment and diminution in
value is temporary in nature.
1.8 The company has paid minimum managerial remuneration to the
Chairman & Managing Director of Rs, 89.23 lacs and Executive Director
of Rs. 79.63 lacs as per Schedule XIII of the Companies Act, 1956
subject to approval of members in the AGM to be held on 31.07.2012 and
Central government in respect of the former.
1.9 Previous year''s figures have been regrouped and reclassified