| 1) The application of the Company for registration to carry on the
business of a Non-Banking Financial Company (NBFC) was not considered
favourably by the Reserve Bank of India (Department of Non-Banking
Supervision) by its Order of November 25,1998. However, the Company was
legally advised that it can carry on business of Non-Banking Financial
Company for the benefit of its deposit holders to repay the outstanding
principals and interest thereon in respect of the deposits matured, and
also to meet its administrative and other related expenses. The Company
can also continue to service its existing contracts and obligations and
business already concluded.
However, with the Company not being permitted to undertake any NBFC
activity. The Company has applied for revision in the Schedule of
Repayments, approved earlier by the Company Law Board (CLB), Western
Region Bench, Mumbai vide Order dated April 4, 2000 read together with
corrigendum dated May 10, 2001, the approval of which is awaited. The
Company has also advised CLB that one of the promoters of the Company
will be bringing in the necessary funds to facilitates the repayment of
deposits on the lines of the revised Schedule submitted to CLB and
pending consideration, as also to meet the Company's administrative and
other related expenses and revival of the Company thereafter.
2) a. Contingent liabilities not provided for in respect of :
As at As at
March 31, 2014 March 31, 2013
i. Income-tax and other demands
for earlier years, as the Company
has 3,00,98,640 3,00,98,640
disputed the relevant orders and
preferred appeals [against which
NIL (Previous year Rs. NIL) has
since been paid]
ii. Guarantee given on behalf of
a Company under the same management 2,00,00,000 2,00,00,000
iii. Arrears of Cumulative
Preference Dividend for the
period March 30, 1998 to 1,92,02,000 1,80,02,000
March 31, 2014 (Free of Income -
Tax and subject to Dividend Tax)
iv. Interest due to Khetan
Industries as per Court order 23,50,000 22,00,000
v. a) Bill discounting (Principle)
due to Vijaya Bank 3,92,552 3,92,552
b) Overdue interest on bill
discounting due to Vijaya Bank 7,65,472 NIL
3) During a search in an earlier year in the premises of the Company,
the investigating agency of the Government of India, had seized,
inter-alia, certain Shares of the Company. These shares have since been
released by the agency, however the company has been restrained from
dealing with same.
4) Under the Miscellaneous Petition filed by the Custodian for recovery
of principal of Rs. 2,88,00,000/- received from a company in an earlier
year, and interest thereon, the Special Court, set up at Bombay under
the Special Court (Trial of Offences Relating to Transactions in
Securities) Ordinance, 1992, passed an Order on July 5, 1995, and
directed the Company to repay the principal amount with interest @ 20%
p.a. from March 25,1992, i.e. from the date of receipt of the deposit
within a period of three years. However, the Company has till date paid
only Rs. 3,14,87,341/- (Previous yearRs. 3,14,87,341/-) against the said
liability. The balance liability of Rs. 12,40,16,591/- (Previous year Rs.
11,82,56,591/-) is included as "Other Liabilities" under "Current
Liabilities - Note 6".
5) a. The Company Law Board, Western Region Branch, Mumbai (CLB), in
terms of Section 58A (9) of the Companies Act, 1956/Section 45QA(2) of
the Reserve Bank of India Act, 1934, vide Order dated April 4, 2000
read together with Corrigendum dated May 10, 2000 had directed the
Company to follow a Schedule of Repayment in respect of Fixed Deposits
accepted by the Company from Public and thereby complete the repayment
process within a period of 30 months from April 1, 2000. The
repayments, though started as per the Schedule, had to be aborted
subsequently, due to continual financial hardships and non- recoveries
of amounts due. Despite the financial problems, the Company repaid Rs.
30,000/- by way of principal during the year.
b. 19% Non-convertible Debentures - 1997 Series (NCDs) aggregating to
Rs. 78,60,850/- which have already become due for redemption and have
remained unpaid as on June 30, 2000 for which the Company had decided
to repay on the same lines with the Order of CLB for Public Deposits.
Accordingly, the Company was expected to pay including accrued interest
an aggregate sum of Rs. 82,81,835/- upto March 31, 2014. Till date the
Company has not been able to repay and the balance ofRs. 92,45,835/- has
remained unpaid. The aggregate overdue NCDs as on March 31, 2013 was Rs.
60,53,401/- The Company may pay these overdue NCDs on the same lines,
as may be revised by the CLB, for the Public Deposits.
c. The Company has approached the Company Law Board (CLB), Western
Region Bench, Mumbai, for revision in the Schedule, earlier approved by
CLB vide order dated April 4, 2000, in respect of payment of
outstanding deposits. The Company's request for the said revision is
under consideration by CLB.
6) Amount due to Khetan Industries Private Limited against
Inter-Corporate Deposit placed with us for X 25,00,000/- for three
months and the same was due for repayment on 24th January 1996.
Thereafter same were converted into advance received for purchase of
equity shares under instructions of Company official's letter dated
22nd January 1996. Same advance were not invested in equity shares due
to existing market conditions. Thereafter advance were not repaid due
to dispute between promoters of the company. However company had filed
Summary Suit in 1998 before the Hon'ble High Court, Mumbai which had
been instituted under Order 37 of the Code of Civil Procedure, 1908 and
Hon'ble High Court has passed vide Order dated 2nd September 2009,
directed that interest @ 6% per annum be payable by the Company from
1st August 1998, being the date of suit, till the payment or
realization of the amount due.
7) The Company has not been able to comply with provision of Sections
372Aof the Companies Act, 1956. The Company as explained earlier has
not been carrying on any activities. Further the Company is restrained
from selling its investments as explained in Note 4.
8) 12,00,000 10% Cumulative Preference shares of Rs. 10/- each fully
paid-up, aggregating Rs. 1.20 crores, allotted by the Company in 1998,
were redeemable at par on March 31, 2003. However, on account of acute
financial crisis being faced by the Company, the repayment was not
done. Further, the Company was unable to issue any equity shares to
facilitate such redemption.
9) Accounting Standard 16 - Segment Reporting :
The Company considers its entire operations under single segment
'Investment'. The Companies operations are only in India.
10) Accounting Standard 18 - Related Party Disclosures : A.
Relationship:
i Key Management Personnel
Mr. S. K. Nandi
Mr. V. M. Satyan
Mr. P. Krishnan ii. Other related parties where controls/significant
influence exists:
Kalpavruksh Holdings & Investments Pvt. Ltd.
11) Deferred Taxation :
The Company has, on prudence, not recognised Deferred Tax Assets (net)
Rs. 1,78,33,421/- mainly representing past losses and unabsorbed
depreciation due to uncertainty of future profits in terms of
Accounting Standard 22-Accounting for Taxes on Income issued by the
Institute of Chartered Accountants of India,
12) Figures in brackets indicate figures of previous year.
13) Previous year figures have been regrouped / reclassified wherever
necessary.
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