| Company overview
ICDS Limited ("the Company") was incorporated on October 21, 1971 and
registered as a Non Banking Financial Company (NBFC). The Company had
fled the Scheme of Arrangement during August 2002, and stopped its fund
based business and surrendered its certifcate of registration as Non
Banking Finance Company to RBI. The Company is presently concentrating
on the recovery of its dues and repaying its liabilities and is also
engaged in trading activities of mobiles and accessories, marketing of
the insurance products of life and general insurance companies. The
Company is diversifying into more fee based activities.
Rights, preferences and restrictions attached to shares:
The Company has two classes of shares referred to as equity shares and
preference shares having par value of Rs.10/- each. Each holder of
equity shares is entitled to one vote per share. The Company has not
issued any preference shares as on March 31, 2014.
In the event of liquidation, the equity shareholders are eligible to
receive the remaining assets of the Company after distribution of all
preferential amounts, in proportion to their shareholding.
Restrictions on the distribution of dividends:
The Board shall, propose to the shareholders the dividend payable out
of free reserves and Profits of the Company. Upon such recommendation
shareholders shall declare dividends i) all such dividends & Profits
shall be paid to shareholders in their existing shareholding pattern
and ii) any such dividend or other distribution shall be based on Profit
generated by the Company or on appropriate basis permitted by the
applicable laws.
Notes:
Nature of security
The above working capital loan is secured by deposit with banks
amounting to Rs.55,000 thousands (March 31, 2013: Rs. 55,000
thousands).
Terms of repayment
The above loan is repayable on demand. Interest for such borrowing
ranges from 10.45% to 10.50% p.a.
Notes
a. Consists of public liabilities which is held and not paid as the
matter being subjudice with Honourable Courts of Andhra Pradesh.
b. The management is of the opinion that the due date for remittance
of unclaimed public liabilities starts after seven years from the due
date of the last installment of the instrument as per the Scheme in
respect of repayment of instruments which were payable in more than one
installments, accordingly the management considers Rs. 90,70 thousands
outstanding with regard to the frst two installments is not due for
payment to Investor Education and Protection Fund pending last
installment falling due. Further, an amount of Rs. 78.47 thousands
claimed by various depositors but withheld due to non receipt of
relevant documents. In view of the same the management is of the
opinion that same is not due for payment to Investors Education and
Protection Fund.
Notes:
a. Investment property includes shares of the face value of Rs. 511/-
in Co operative Housing Society.
b. Market price of the Quoted shares has been taken at face value, in
the absence of trading in stock exchanges during the year.
c. Details of Provisions for diminution in value of investments
Notes:
a. Demerger receivable:
i. Demerger receivable represents Rs. 15,076 thousands (March 31, 2013:
Rs. 36,490 thousands) from MPL Enterprises Ltd. pursuant to the scheme
of arrangements sanctioned by Hon'ble High Courts of Karnataka and
Madras vide their Orders dated April 09, 1999 and August 25, 2000
respectively. The balance is considered good for recovery in the
opinion of the management, as the value of the property vested in MPL
Enterprises Ltd. is adequate.
ii. Investment of Rs. 999 thousands (March 31, 2013: Rs. 999 thousands)
and demerger receivable of Rs. 2,845 thousands (March 31, 2013: Rs.
4,145 thousands) being amount due from Manipal Properties Limited a
subsidiary, on account of scheme of arrangements sanctioned by Hon'ble
High Courts of Karnataka and Madras vide its Order dated April 09, 1999
and August 25, 2000 respectively is considered good for recovery in the
opinion of the management, as the present market value of the property
vested in Manipal Properties Limited is adequate and in view of long
term involvement with the said Company.
b. Demerger receivables considered doubtful includes Rs. 7,830
thousands (March 31, 2013: Rs. 7,812 thousands due from Manipal Hotels
Ltd. and Rs. 8,536 thousands (March 31,2013 : Rs. 12,436 thousands) due
from Manipal Properties Ltd., the wholly owned subsidiary companies.
2.25 In pursuance to the Scheme of Arrangement ( the 'scheme' ) under
sections 391 to 394 of the Companies Act, 1956 sanctioned by the
Hon'ble High Court of Karnataka ('the Court') vide its order dated
October 15, 2004 and fled with the Registrar of Companies, Karnataka on
December 30, 2004 (ie. effective date) the Company has implemented the
scheme and accordingly repaid all installments of debentures, deposits
and subordinated debts which were claimed in terms of the scheme. The
Company has fled an affdavit on August 31, 2010 before the Court
stating that the scheme has been successfully implemented and the Court
has passed an Order stating that Scheme of Arrangement sanctioned by
the Court on October 15, 2004 is fully complied by the Company.
The accounts have been prepared on Going concern basis, considering the
successful implementation of the Scheme of Arrangement as mentioned
above, the Company's foray into fee based activities and its intention
to start fresh NBFC business subject to approval from Reserve Bank of
India.
2.26 Contingent liabilities Rupees in Thousands
Particulars March 31, 2014 March 31, 2013
Contingent liabilities:
Guarantee issued in favour of bankers 320 320
Claims against the company/disputed
liabilities not acknowledged as debt/ 1,058 1,058
liabilities
Income Tax * 102,404 102,404
* - Income tax demand represents Rs.102,404 thousands (March 31, 2013:
Rs.102,404 thousands) in respect of Block assessment held for the
period from assessment year 1991-92 to 1996-97 following the Order of
Hon'ble High Court of Karnataka in respect of disallowance of
depreciation on leased assets. The Company has fled an Special Leave
Petition (SLP) with Hon'ble Supreme Court of India against the Order of
Hon'ble High Court of Karnataka. The Company has deposited Rs. 49,335
thousands (March 31, 2013: Rs. 46,232 thousands) against the said
demanded Tax. The Company has offered one of its immovable property as
security which is free of any encumbrances. Based on the decisions of
the Appellate authorities/Courts and the interpretations of other
relevant provisions, the Company has been legally advised that the
demands raised on account of block assessment and disallowance of
depreciation would get vacated and accordingly no provision is
considered necessary.
2.27 Deferred tax
The Company has not recognized Deferred Tax Asset as per AS 22 on
'Accounting for Taxes on Income' issued by the Institute of Chartered
Accountants of India, constituting, mainly of carry forward losses,
excess depreciation claimed in Income tax and provision for doubtful
debts, as a matter of prudence.
2.28 Employee benefits:
The Company has adopted Accounting Standard 15, Employee benefits
(revised 2005), issued by the Institute of Chartered Accountants of
India [the 'revised AS 15'].
The disclosures as required under the revised AS 15 are as under:
Brief description of the Plans :
a. The Company has two schemes for long-term benefits such as Provident
Fund and Gratuity. In case of funded schemes, the funds are recognised
by the Income Tax authorities and administered through trustees /
appropriate authorities. The Company's Defined contribution plan is
Employees' Provident Fund (under the provisions of the Employees'
Provident Funds and Miscellaneous Provisions Act, 1952) The Company has
no further obligation beyond making the contributions. The Company's
Defined benefit plan is Gratuity.
Notes:
i. The Company's liability towards gratuity to employees is covered by
a group policy with LIC of India and contributions are charged to
statement of Profit and loss. ii. Based on the above allocation and the
prevailing yields on these assets, the long term estimate of the
expected rate of return on fund assets has been arrived at. Assumed
rate of return on assets is expected to vary from year to year
refecting the returns on matching government bonds.
2.30 The Company has identified two reportable segments viz. Financial
Services (recovery of loans and advances) and Sale of shares and
Mobiles and Accessories; Others include Marketing of the insurance
products of life and general insurance companies. Segments have been
identified and reported taking into account nature of products and
services, the differing risks and returns and the internal business
reporting systems. Accordingly segment reporting disclosures as
envisaged in Accounting Standard (AS-17) on Segmental Reporting, issued
by the ICAI are given below,
Notes:
a) Interest expenditure and interest income of company are not shown
separately for financial services since the same is integral part of
financial business.
b) Geographical segment is not relevant for the company since it is not
involved in exports.
c) Previous year figures given in italics.
2.31 The Company has entered into certain cancellable operating lease
agreements mainly for office premises and same has been charged to
Statement of Profit and Loss amounting to Rs.338 thousands (March 31,
2013 : Rs. 297 thousands).
2.32 In the opinion of the management, loans and advances, current and
non current assets are good and recoverable and no provision is
considered necessary.
2.33 Figures of the previous year wherever necessary, have been
reworked, regrouped, reclassified and rearranged to conform with those
of the current year.
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