Moneycontrol Be a Pro
Get App
SENSEX NIFTY
Moneycontrol.com India | Notes to Account > Construction & Contracting - Civil > Notes to Account from Unitech - BSE: 507878, NSE: UNITECH
YOU ARE HERE > MONEYCONTROL > MARKETS > CONSTRUCTION & CONTRACTING - CIVIL > NOTES TO ACCOUNTS - Unitech

Unitech

BSE: 507878|NSE: UNITECH|ISIN: INE694A01020|SECTOR: Construction & Contracting - Civil
SET ALERT
|
ADD TO PORTFOLIO
|
WATCHLIST
LIVE
BSE
Oct 18, 15:41
0.40
0.01 (2.56%)
VOLUME 874,673
LIVE
NSE
Oct 18, 15:58
0.45
0.05 (12.5%)
VOLUME 11,008,615
Mar 16
Notes to Accounts Year End : Mar '17

As explained and represented by management, the Company has earmarked six unencumbered land parcels including those in subsidiary Companies for sale and utilization of sale proceeds thereof for repayment of deposits. Further, as informed, the management is committed to repay all the deposits along with interest thereon and is making all efforts to arrange the necessary resources required for this purpose.

1. First Time Adoption of Ind AS

These financial statements, for the year ended 31 March 2017, are the first, the company has prepared in accordance with Ind AS. For periods up to and including the year ended 31 March 2016, the company prepared its financial statements in accordance with accounting standards notified under section 133 of the Companies Act 2013, read together with paragraph 7 of the Companies (Accounts) Rules, 2014 (Indian GAAP).

Accordingly, the company has prepared financial statements which comply with Ind AS applicable for periods ending on 31 March 2017, together with the comparative period data as at and for the year ended 31 March 2016, as described in the summary of significant accounting policies. In preparing these financial statements, the company’s opening balance sheet was prepared as at 1 April 2015, the company’s date of transition to Ind AS. This note explains the principal adjustments made by the company in restating its Indian GAAP financial statements, including the balance sheet as at 1 April 2015 and the financial statements as at and for the year ended 31 March 2016 and 31 March 2017.

Exemptions applied:-

Deemed cost- Fair value of property, plant and equipment

The Company has elected to continue with the carrying value of all of its plant and equipment, and intangible assets recognised as of April 1, 2015 (transition date) measured as per the previous GAAP and use that carrying value as its deemed cost as of the transition date.

Estimates

The estimates at 1 April 2015 and at 31 March 2016 are consistent with those made for the same dates in accordance with Indian GAAP (after adjustments to reflect any differences in accounting policies) apart from the following items where application of Indian GAAP did not require estimation:

Impairment of financial assets based on expected credit loss model

The estimates used by the company to present these amounts in accordance with Ind AS reflect conditions at 1 April 2015, the date of transition to Ind AS, as of 31 March 2016.

Classification and measurement of financial assets

The company has classified the financial assets in accordance with Ind AS 109 on the basis of facts and circumstances that exist at the date of transition to Ind AS.

Impairment of financial assets: (Trade receivables and other financial assets)

At the date of transition to Ind AS, the Company has determined that there significant increase in credit risk since the initial recognition of a financial instrument would require undue cost or effort, the Company has recognised a loss allowance at an amount equal to lifetime expected credit losses at each reporting date until that financial instrument is derecognised (unless that financial instrument is low credit risk at a reporting date).

2 (ii) FINANCIAL RISK MANAGEMENT

The Company’s principal financial liabilities, other than derivatives, comprise loans and borrowings, trade and other payables. The main purpose of these financial liabilities is to finance the Company’s operations. The Company’s principal financial assets include loans, trade and other receivables and cash and cash equivalents that are derived directly from its operations

The Company’s financial risk management is an integral part of how to plan and execute its business strategies. The Company is exposed to market risk, credit risk and liquidity risk. The company’s focus is to foresee the unpredictability of financial markets and seek to minimize potential adverse effects on its financial performance.

The Company’s principal financial liabilities comprise borrowings, trade and other payables. The main purpose of these financial liabilities is to manage finances for the Company’s operations. The Company principal financial asset includes loan , trade and other receivables, and cash and short-term deposits that arise directly from its operations.

The Company’s activities are exposed to market risk, credit risk and liquidity risk.

I. Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market prices comprise three types of risk: currency rate risk, interest rate risk and other price risks, such as equity price risk and commodity price risk. Financial instruments affected by market risk include loans and borrowings, deposits, investments, and derivative financial instruments.

The sensitivity of the relevant profit or loss item is the effect of the assumed changes in respective market risks.

(a) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. In order to optimize the Company’s position with regard to interest income and interest expenses and to manage the interest rate risk, treasury performs a comprehensive corporate interest rate risk management by balancing the proportion of the fixed rate and floating rate financial instruments in its total portfolio.

(i) The exposure of group borrowings to interest rate changes at the end of reporting period are as follows:__

(ii) As at the end of reporting period, the company had the following variable rate borrowings and interest rate swap contracts outstanding:

(iii) Sensitivity

Profit/loss is sensitive to higher/lower interest expense from borrowings as a result of changes in interest rates._

(b) Foreign currency Risk

Foreign currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company has no foreign currency loans in current year end and previous year . Therefore no sensitivity is provided.

(c) price Risk

The company exposure to equity securities price risk arises from the investments held by company and classified in the balance sheet at fair value through profit and loss. The company does not have any investments at the current year end and previous year which are held for trading. Therefore no sensitivity is provided.

II. Credit Risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. The company has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral, where appropriate, as a means of mitigating the risk of financial loss from defaults. The company’s credit risk exposure towards its counterparties are continuously monitored . Credit exposure of any party is controlled , reviewed and approved by the appointed company official in this regard The average credit period is 30 days.

No interest is charged on trade receivables for the first 30 days from the date of the invoice. Thereafter, interest is charged on case to case basis

III. Liquidity Risk

Liquidity risk is defined as the risk that company will not be able to settle or meet its obligation on time or at a reasonable price. The Company’s objective is to at all times maintain optimum levels of liquidity to meet its cash and collateral requirements. The Company’s management is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risk are overseen by senior management. Management monitors the company’s net liquidity position through rolling, forecast on the basis of expected cash flows.

The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments:

(iii) (A) Risk Management

The Company manages its capital to ensure that the company will be able to continue as going concerns while maximising the return to stakeholders through the optimization of the debt and equity balance.

The Company’s risk management committee reviews the capital structure of the Company on a semi-annual basis. As part of this review, the committee considers the cost of capital and the risks associated with each class of capital. The Company monitors capital on the basis of following gearing ratio, which is net debt divided by total capital plus debt

(B) Geraring ratio

The gearing ratio at end of the reporting period was as follows.

3 a) ACCOUNTING OF REAL ESTATE PROJECTS UNDERTAKEN UP TO 31st March, 2004

The actual receipts and installments due of Rs.38,272,964 (previous year Rs.38,640,728) for the year from booking of plots/constructed properties in ongoing real estate projects has been credited to revenue from operations. Against this, after ascertaining profits on estimate basis as per accounting policy no. 1(XII)(A)(a) the balance of eighty percent is adjusted in real estate project expenditure. The final adjustment of profit/loss is being made on completion of respective project(s).

b) CONSTRUCTION CONTRACTS

c) The construction material includes mild steel, cement, sand and other construction material. During the year the company dealt in mild steel only (refer Note No. 30 & 32).

d) Disclosure in respect of projects which is covered under the Revised Guidance Note issued by the Institute of Chartered Accountants of India on “Accounting for Real Estate Transactions (Revised 2012)” and where revenue recognition has been stated as per accounting policy no.1(XII)(A)(b)&(c).

e) Deferred tax assets are recognised for carried forward business loss and unabsorbed depreciation during the year where there are foreseeable profits in future based on the agreement to sell already entered with buyers, which in the opinion of management indicates virtual certainity supported by convincing evidence that sufficient future taxable income will be available as the construction progresses against which such deferred tax assets can be realaised.

f) The Company had earlier sold some of its investments and recognized sale based on the consideration amount received against such sale as well as contractual arrangement thereof. However, during the financial year ending 31st March 2016, the Company reversed this sale transaction in its books due to revised contractual understanding and accordingly, the consideration received from the purchaser had been shown as amount payable by the Company

4. BENEFITS TO EMPLOYEES:

As per Ind AS 19, ‘Employee benefits’, the disclosures of employee benefits are as given below:

a) Defined contribution plan

Contributions recognized as expense for the year are as under:

b) Defined benefit plan

The cost of providing gratuity and long term leave encashment are determined using the projected unit credit method on the base of actuarial valuation techniques conducted at the end of the financial year.

The following tables summarize the component of net benefit expense in respect of gratuity and leave encashment recognized in the statement of profit and loss and balance sheet as per actuarial valuation as on 31st March 2017.

5. SEGMENT REPORTING

Segment wise revenue, results & other information

The company is primarily in the business of real estate development and related activities including construction, consultancy and rentals etc. Further most of the business conducted is within the geographical boundaries of India.

In view of the above, in the opinion of the management and based on the organizational and internal reporting structure, the company’s business activities as described above are subject to similar risks and returns. Further, since the business activities undertaken by the company are substantiating within India, in the opinion of the management, the business environment in India is considered to have similar risks and returns. Consequently, the company’s business activities primarily represent a single business segment and the company’s operations in India represent a single geographical segment.

6. LEASED ASSETS:

a) Operating lease taken:

Operating lease obligations: The company has taken cars/ office equipments on operating lease basis. The lease rentals are payable by the company on a monthly basis. Future minimum lease rentals payable as at 31 st March, 2017 as per the lease agreements are as under:

b) Operating lease given:

i) Details of assets given on operating lease:

ii) The company has given buildings on operating lease basis. The lease rentals are receivable by the company on a monthly basis. Future minimum lease rentals receivable as at 31st March, 2017 as per the lease agreements are as under:

Lease income recognized in the statement of profit and loss is Rs.142,839,000 (previous year Rs.3,374,000)

c) Finance lease :

The company has acquired plant and machinery and vehicles under finance lease with the respective underlying assets as security. Minimum lease payments (MLP) outstanding in respect of these assets are as follows :

7. Details of Specified Bank Notes (“SBNs”) held and transacted during the period from 08th November 2016 to 31st December 2016 as defined in MCA notification G.S.R. 308 (E) dated March 31, 2017 provided in the table below:

8. CONTINGENT LIABILITIES AND COMMITMENTS (TO THE EXTENT NOT PROVIDED FOR)

I. Claims against company not acknowledged as debt

Refer Accounting policy No. XII, according to which the contract revenue on account of interest on delayed payment by customers and expenditure on account of compensation/ penalty for project delays are accounted for at the time of acceptance/ settlement with the customers due to uncertainties with regard to determination of amount receivable/ payable. As per Guidance Note on Real Estate Accounting read with paragraph 11(c) of Accounting Standard 7 - Construction Contracts, the amount of contract revenue may decrease as a result of penalties arising from delays caused by the contractor in the completion of the contract. Company is of the firm opinion that no significant liability has devolved upon them on account of such delays/ penalties and even in some cases where such penalties may contractually have arisen, the corresponding interest on delayed payment by customers is sufficient to nullify the impact. Further, in certain cases, penalty towards confirmed delays are adjusted with customer dues receivable, against excess area sold to customers.

c) Income tax matter in dispute (financial year 2004-05) pending in appeal: Rs.7,363,246 (previous year Rs.7,363,246), (financial year 2006-07) pending in appeal: Rs.222,484,964 (previous year Rs.222,484,964) (Amount paid under protest by the company : Rs.169,379,967), (financial year 2009-10) pending in appeal: Rs.3,025,191,760 (previous year Rs.3,025,191,760) (Amount paid under protest by the company : Rs.897,324,472), (financial year 2010-11) pending in appeal: Rs.1,188,242,280 (previous year Rs.1,188,242,280) (Amount paid under protest by the company : Rs.222,575,821), (financial year 2011-12) pending in appeal: Rs.824,043,190 (previous year Rs.824,043,190) (Amount paid under protest by the company : Rs.68,522,620), (financial year 201213) pending in appeal: Rs.1,137,095,370 (previous year Rs.1,137,095,370) Vide notice u/s 281B of the Income tax Act, 1961 dated 06/02/2013, 2,237,030 equity shares of Carnoustie Management Pvt. Ltd. having value of Rs.3,100,545,000 and 1,000,000 equity shares of Shivalik Ventures Pvt. Ltd. having value of Rs.10,000,000,000 held by the company have been attached.

Income Tax (TDS) matter in dispute (financial year 2007-08) pending in appeal: Rs.16,219,162 (previous year Rs.16,219,162), (financial year 2011-12) pending in appeal: Rs.116,196,935 (previous year Rs.116,196,935), (financial year 2012-13) pending in appeal: Rs.168,599,180 (previous year Rs.168,599,180), (financial year 2013-14) pending in appeal: Rs.200,077,281 (previous year Rs. NIL).

d) Sales tax matter in dispute: (financial year 2005-06) pending in appeal : Rs.7,300,428 (previous year Rs.7,300,428) (Amount paid under protest by the company : Rs.7,300,428); (financial year 2011 -12) pending in appeal : Rs.281,988,670 (previous year Rs.281,988,670); (financial year 2012-13) pending in appeal : Rs.163,802,119 (previous year Rs.163,802,119)

e) Service tax matter in dispute: (for the period 01/12/2005-31/07/2007): Rs.7,260,129 (previous year Rs.7,260,129), (financial year 2012-13) pending in appeal: Rs.93,494,668 (previous year Rs.93,494,668)

II. Guarantees

III. Commitments

b) Investment in 1,000,000 equity shares of Rs.10 each at a premium of Rs.9,990 per share aggregating of Rs.10,000,000,000 has been made in joint venture company, Shivalik Ventures Pvt. Ltd. An amount of Rs.4,916,200,000 has been paid against the allotment of fully paid-up shares. The balance securities premium of Rs.5,083,800,000 will be accounted for on payment.

e) The Company had received an Arbitral award dated 6th July 2012 passed by the London Court of International Arbitration (LCIA) wherein the arbitration tribunal had directed the company to invest USD 298,382,949.34 (Previous year USD 298,382,949.34) equivalent to Rs.19,346,732,699 (Previous year Rs.19,792,606,340) in Kerrush Investments Ltd. (Mauritius). The High Court of Justice, Queen’s Bench Division, Commercial Court London had confirmed the said Award.

Though the Company believed, on the basis of legal advice, that the said award is not enforceable in India on various grounds, including, but not limited to lack of jurisdiction by the LCIA appointed Arbitral tribunal to pass the said award, the aggrieved party filed a petition with Hon’ble High Court of Delhi for enforceability of the said Award. The Hon’ble High Court of Delhi has passed an order in the case instant.

Based on its own assessment and legal advice received, the Company is sanguine & strongly believes that its stand taken in this matter will be vindicated in the Hon’ble Supreme Court. The Company is preparing for filing the SLP in the Hon’ble Supreme Court against the said Order of the Hon’ble High Court of Delhi.

Moreover, in case the Company is required to make the aforesaid investment into Kerrush Investments Ltd. (Mauritius), its economic interest in the SRA project in Santacruz Mumbai shall stand increased proportionately thereby creating a substantial asset for the Company with an immense development potential.

f) Investment in shares of subsidiaries amounting to Rs.174,146,060 (Previous year Rs.181,696,060) are pledged as securities against loan taken by the company. Investment in shares of joint ventures amounting to Rs.77,675,000 (Previous year Rs.77,500,000) are pledged as securities against loan taken by the company and its joint venture. Investment of subsidiary in the shares of joint ventures of the subsidiary amounting to Rs. NIL (Previous year Rs. NIL) pledged as securities against loan taken by the company. Investment of subsidiaries in the shares of its associates amounting to Rs.245,000 (Previous year Rs.245,000) pledged as securities against loan taken by the company.

9. ACCOUNTING OF PROJECTS WITH CO-DEVELOPER

The company is developing certain projects jointly with Pioneer Urban Infrastructure Limited and its other group companies. All the development expenses and sale proceeds booked during the year are transferred to the co-developer at the year end in proportion to share of actual land pooled by each developer.

10. The company had availed rupee term loan facility from a public financial institution which was inter alia secured by the land allotted to the company’s subsidiary. Subsequently, as per the terms of allotment, correction in the lease deed was carried out to allot land to a special purpose company, however, no action has been taken for consequent modifications in the mortgage deed. During the financial year 2013-14, the company received a notice under Section 13(4) of the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) from the financial institution for taking notional possession of the said land provided as security, by alleging default in repayment of the said loan facility. The detail of loans and overdue amount is given in Note 21 to the standalone Ind AS financial statements. The company has been legally advised that this notice is not tenable in terms of the provision of SARFAESI Act and therefore, the Company has challenged the same by filing an application before the Hon’able Debt Recovery Tribunal, Lucknow (DRT). Pending the matter before DRT for final decision, the financial institution issued e-auction sale notice dated 05.04.2016 for sale of the aforesaid land, and consequent to this sale notice, concerned authority, which has allotted this land to the company’s subsidiary, also issued show cause notice dated 11.04.2016 for cancellation of allotment thereof. On the request of the company, DRT has stayed the auction of land and cancellation of allotment thereof, with a direction to all the parties to maintain status quo in respect of said land.

11. The company had issued the secured non-convertible debentures on private placement basis disclosed under note 27 to the financial statement to a lending financial institution and these debentures are inter alia secured by the charge on immovable properties of the company and its subsidiaries. However, as on 31st March 2017, these non-convertible debentures (including interest accrued thereon) was pending for redemption for a period of more than one year from their respective due date. The lending financial institution has initiated action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) for recovery of amount pending against these debentures. The company has been legally advised and has also obtained an opinion that default in redemption of privately placed debentures subscribed by the financial institutions which are lenders of money or default in payment of interest thereon, will not attract the provisions of Section 164(2)(b) of the Companies Act, 2013 or Section 274(1)(g) of the erstwhile Companies Act, 1956.

12. Pursuant to Section 74(2) of the Companies Act, 2013, the Company had made an application to the Hon’ble Company Law Board (subsequently replaced by the Hon’ble National Company Law Tribunal, New Delhi) seeking extension of time for repayment of the outstanding public deposits (including interest thereon) as is considered reasonable. The Company had also identified and earmarked 6 (six) unencumbered land parcels for sale and utilization of the sale proceeds thereof for repayment of the aforesaid outstanding deposits. However, during the financial year under review, the Hon’ble National Company Law Tribunal, New Delhi (NCLT) vide its order dated 04.07.2016 dismissed the said application. On appeal against the said order, the Hon’ble National Company Law Appellate Tribunal, New Delhi (NCLT) vide its order dated 03.11.2016 extended the date of repayment of deposits upto 31.12.2016. Subsequently, the said appeal was also disposed off by the Hon’ble NCLT vide its order dated 31.01.2017 without granting any further extension of time.

As explained and represented by management, the Company is making best possible efforts for sale of the land parcels earmarked for repayment of the deposits but such sale process is taking time due to global economic recession and liquidity crisis, particularly, in the real estate sector of India. However, regardless of these adverse circumstances and difficulties, the management has represented that they are committed to repay all the public deposits along with interest thereon.

Considering that the management has not been able to comply with the directions given by the Hon’ble CLB, NCLT and NCLT to repay the deposits within prescribed time-period, the Registrar of Companies, New Delhi has filed prosecution against the Company and its executive directors and key managerial personnel before the Ld. Special Court, Dwarka District Court, New Delhi. However, the Hon’ble High Court of Delhi has stayed the said prosecution. The company is of the firm belief that there shall be no additional penalties in this matter. However the company is unable to evaluate the likelihood of penalties/ strictures or further liabilities, if any on the Company. Accordingly, impact, if any, of the above, on the stand alone financials is currently not ascertainable.

13. a) The Company through its subsidiary, viz. Unitech Vizag Projects Limited (“UVPL”), successfully submitted bid to Andhra Pradesh Industrial Infrastructure Corporation Limited (“APIIC”) for development of an Integrated Vizag Knowledge City at Vizag for which Rs.2,750,000,000 including EMD and project development expenses has been paid by the Company on prorata of the acreage measurement basis and a development agreement was also signed with APIIC. The Company vide Letter of Award dated 24th Sept, 2007 was allotted 1750 acres of land in Vizag. Subsequently, UVPL got the letter from APIIC for rescinding the development agreement against which application has been filed under section 9 of the Arbitration and Conciliation Act, 1996 (“the Act”) before the ld. court of XI Additional Chief Judge, City Civil Court at Hyderabad to stay the operation of the letter. In riApril 2014, the Company and UVPL have already invoked the arbitration clause and also filed an application under Section 11 of the Act for appointment of arbitrator before the Hon’ble High Court of Andhra Pradesh at Hyderabad and the same is pending for adjudication. The said application is pending for filing of reply by APIIC. The Company also filed an interlocutory application in continuation to pending Section 9 application before the ld. City Civil Court, Hyderabad to restrain APIIC from creating any third party rights with regard to the aforesaid project. Arguments have been concluded in this matter and order has been reserved by the ld. Court. After considering the circumstances and legal advice obtained by the management, the company is confident that the letter issued by APIIC is not legally tenable and it will not adversely affect the company’s investment, and accordingly no provision has been made in the books of account. The Company is also taking appropriate action for refund of the amount already paid by the Company to APIIC with interest and damages.

b) The Company, vide Letter of Award dated 28th November 2007, was allotted 350 acres of land in Nadergul Village, Saroornagar Mandal, RR District, Hyderabad (Andhra Pradesh) by Andhra Pradesh Industrial Infrastructure Corporation Limited (“APIIC”). In terms of the Letter of Award, the entire purchase consideration of Rs.1,600,000,000 including EMD has already been paid to APIIC and a development agreement dated 19th August 2008 has been signed with APIIC to develop the said land through Unitech Hyderabad Township Ltd., a wholly-owned subsidiary of the Company. Recently, the Company came to know that the Hon’ble Supreme Court vide its order 9th October 2015 has quashed the acquisition of the aforesaid land by the Government of Andhra Pradesh from the landowners and transfer of the same to TSIIC(erstwhile APIIC). The Company is taking appropriate action for refund of the amount already paid by the Company to TSIIC(erstwhile APIIC)with interest and damages as per development agreement terms and conditions.

c) The company was awarded a project for development of amusement cum theme park in Chandigarh by Chandigarh administration. The said development agreement was unilaterally and illegally terminated by the Chandigarh administration. The company filed a writ petition before Hon’ble High Court of Punjab & Haryana challenging the termination of development agreement. The matter was referred for arbitration and the matter is pending adjudication before the panel of three arbitrators. The company has concluded its evidence. The company has a good case and accordingly no provision has been considered necessary.

14. The company has non-current investments (long term investments) in, and loans and advances given to, some subsidiaries (including advance for purchase of shares for proposed subsidiaries) which have accumulated losses. These subsidiaries have incurred loss during the current and previous year(s) and that current liabilities of these subsidiaries also exceed their current assets as at the respective balance sheet dates. Management has evaluated this matter and is of the firm view that the diminution, if any, even if it exists is only temporary and that sufficient efforts are being undertaken to revive the said subsidiaries in the foreseeable future so as to recover carrying value of the investment. Further, management believes that the loans and advances given to these companies are considered good and recoverable based on the future projects in these subsidiaries and accordingly no provision other than those already accounted for, has been considered necessary.

15. Advances for purchase of land, projects pending commencement and to joint ventures and collaborators amounting to Rs.6,491,240,803 (previous year Rs.6,508,764,168) included under the head “Advances for purchase of land and project pending commencement” in Note 18 have been given in the normal course of business to land owning companies, collaborators, projects or for purchase of land. Further Rs.454,023,365 (previous year Rs.476,179,157) has been recovered / adjusted during the current financial year. The management has been putting a constructive and sincere effort to recover / adjust the said advances and has been successful in recovering / adjusting a significant amount out of the total advances, so no provision is necessary to be created for the outstanding advances as at the balance sheet date. Further, the management is confident to recover / adjust the balance outstanding amount in the foreseeable future.

16. The Company was allotted land parcel admeasuring 100 acres, bearing plot no. GH-01 in Sector MU of Greater Noida for construction and development of residential/ group housing project, and a lease deed dated 22.01.2007 was signed in this regard with Greater Noida Industrial Development Authority (“GNIDA”).

Due to downward trend in the real estate market and liquidity crisis, the Company made several requests to GNIDA for re-schedulement of the dues payable against the aforesaid land. However, GNIDA issued a cancellation letter bearing no. Greno/Builders/2015/1516 dated 18.11.2015 to the Company cancelling allotment of the aforesaid land. The Company submitted a representation letter dated 01.12.2015 to GNIDA against this cancellation letter. Considering the amount already invested and significant efforts already made by the Company for development of this project including amounts paid to GNIDA from time to time and the plots already allotted to the customers in this project resulting in creation of third party interest, the Company has requested GNIDA in its representation letter dated 01.12.2015 to allow the Company to retain 25 acres of land parcel out of total 100 acres and to adjust the amount already paid by the Company against the land price of 25 acres and the remaining surplus amount against other dues payable by the Company to GNIDA. The said request is still under consideration with GNIDA.

Further, the customers’ association in the aforesaid project has filed a complaint before the Hon’ble National Consumer Dispute Redressal Commission, New Delhi. The Company brought this fact to the notice of GNIDA vide its letter dated 12.05.2016. The customers’ association has also filed a writ before the Hon’ble High Court at Allahabad wherein GNIDA and the Company have been made parties. Considering the fact that matter pertaining to cancellation of allotment of the aforesaid land is sub-judice, as per the legal advice obtained by the management, the Company believes that cancellation order of the entire land parcel of 100 acres issued by GNIDA will not hold good.

17. The Company, in the year 1979, was granted certain relaxations under the Employees’ Provident Fund Scheme by the office of Regional Provident Fund Commissioner Nehru Place New Delhi . However, with effect from 31.10.2014, these relaxations have been withdrawn by the Regional Provident Fund Commissioner, Delhi (South) vide an order dated 01.12.2014, with a direction to transfer the entire past accumulated funds with the PF Trust, viz. United Technical Consultants Provident Fund, to the Office of the Employees’ Provident Fund Organisation (EPFO).

As on 31.10.2014, total dues towards the amount payable to its members by the PF Trust were calculated to Rs.986,117,427 vide order dated 22.04.2016 passed by the Regional Provident Fund Commissioner which were required to be transferred to the office of EPFO. The Company has deposited the said amount .

Further a sum of Rs.225,630,283 pertaining to provident fund and pension scheme is pending for deposit from May 2015 till March 2017. The Company intends to deposit the same in course of time.

18. PREVIOUS YEAR FIGURES

Previous year figures have been regrouped, rearranged and reclassified wherever considered necessary.

Source : Dion Global Solutions Limited
Quick Links for unitech
Explore Moneycontrol
Stocks     A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z | Others
Mutual Funds     A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V | W | X | Y | Z
Copyright © e-Eighteen.com Ltd. All rights reserved. Reproduction of news articles, photos, videos or any other content in whole or in part in any form or medium without express written permission of moneycontrol.com is prohibited.