| 1. The net worth of the Company is fully eroded and the Company is a
sick industrial company within the meaning of clause (o) of sub-section
(1) of Section 3 of the Sick Industrial Companies (Special Provisions)
Act, 1985 (SICA), for which a reference has been made to the Board of
Industrial and Financial Reconstruction (BIFR) under Section 15 of
SICA.
2. As per scheme of arrangement sanctioned by the Bombay High Court
under Section 391 and 394 of Companies Act, 1956 made between Shree
Vindhya Paper Mills Ltd and the Company, the coating division of Shree
Vindhya Paper Mills Ltd. with its assets, investments, liabilities and
reserves as at 31st December, 1991 has been transferred to and vested
with the Company with effect from 1st January, 1992. However, certain
assets and liabilities of the said division before its transfer though
reflected in the accounts are yet to be transferred in the name of the
Company.
3. Contingent liability not provided for in respect of:
As at As at
31/03/2014 31/03/2013
Rs. Rs.
a) Claims against Company not acknowledged
as debts 437,567 437,567
b) Guarantee given to financial institution
for loans taken by its 48,454 48,454
employees
c) Bank guarantee to constituents and
others. 1,360,000 1,360,000
d) Corporate Guarantee given to financial
institutions and banks 25,000,000 25,000,000
on behalf of Vecron Industries Limited
(a wholly owned subsidiary Company)
e) Liability as may arise for non-payment of wages, PF, Gratuity Amount
Amount and other labour dues since the date of closure of factory, as
unascertained unascertained the case filed by the worker's union in
Nashik Labour Court
f) Liability as may arise due to non compliance of certain fiscal
Amount Amount statute unascertained unascertained
g) Income Tax Penalty Demand 19.38,082 19.38,082
h) Liability for Interest on deferred
sales tax liability Amount Amount
unascertained unascertained
i) Sales Tax Liability 1996-97 51,606 51,606
j) Bank Liability - Subsidiary Co. 4,91,14,993 4,91,14,993
4. The bank has auctioned the Land. Factory Premises, Plant and
Machinery, Inventory and other assets lying at Nasik in Financial Year
2007-08 which was approved by the Debt Recovery Tribunal. On the basis
of correspondence received from the bank, auction proceeds received by
bank has been utilised directly by bank to repaid Bank Cash Credit
Liabilities, Debentures with interest, Electricity Charges, deposit
given to Labour Court for Labour Settlement and other related expenses.
The documentary evidences for such payments made not available with the
Company. The accounting of the above transaction has been done on the
basis of correspondence taken place with bank. No confirmations from
banks, debenture holders, electricity department or labour court have
been received against the proceeds received.
5. The auction proceed which were not utilized by bank for payment of
any liabilities of the company has been kept by bank. The bank is not
providing interest on such amount held.
6. Sales Tax Incentive loan became payable w.e.f. 4th August, 2004 as
per terms of its sanction due to closure of factory / business. The
liability is shown under the head "Current Liability". The management
is of the view that the liability will be settled with the Sales Tax
Authority, hence no interest on the loan amount due has been provided
in the books of accounts.
7. Security deposit received from the dealers shown under the head
"Current Liability" The management is of the view that Interest on
deposit will not be paid hence not provided.
8. There were no amounts due to Small Scale and / or Ancillary
Industrial suppliers on account of principal and / or interest as at
the end of year. This disclosure is based on the information available
with the Company regarding the status of the suppliers as defined under
the Interest on Delayed Payments of Small Scale and Ancillary
Industrial undertaking Act, 1993.
9. The Company has closed the business; hence segment reporting is
not applicable.
10. The secondary segment, i.e. 'geographical segment by location of
customers' is not applicable.
11. Related party disclosures:
Related party relationships:
A Subsidiary Company Vecron Industries Limited
enterprises where control exists)
B Key management personnel Mr. Vikram Somani
Mr. Bharat Somani
C Enterprise in which Key management SRS Trading & Agencies Private
Limited
personnel have significant influence
Notes:
1. The related party relationships have been determined on the basis
of the requirements of the Accounting Standard (AS-18) 'Related Party
Disclosures' issued by the Institute of Chartered Accountants of India
and the same have been relied upon by the auditors.
2. The relationships as mentioned above pertain to those related
parties with whom transactions have taken place during the year (except
where control exists, in which case the relationships are disclosed
irrespective of exact transactions).
12. As per the Accounting standard AS-22 "Accounting for Taxes on
Income" issued by the Institute of
Chartered Accountants of India, the deferred tax assets (net) arising
during the previous year on account of timing difference. Having regard
to the net worth of the Company being fully eroded and the Company is a
Sick industrial company within the meaning of SICA and uncertainty as
to whether the Company can continue as a going concern, the deferred
tax assets / liabilities has not been recognised.
13. In the opinion of the management, current assets, loans and
advances have a value on realisation in the ordinary course of business
at least equal to the amount at which they are stated and provision for
all known and determined liabilities are adequate and not in the excess
of the amount reasonably stated. The balances in case of sundry
creditors, debtors and banks are subject to confirmation and
reconciliations. The differences if any, as may arise will be accounted
for on receipt of such information/reconciliation.
14. In view of the carried forward losses, provision for current year
taxation and provision for deferred tax is not provided in the books of
accounts.
15. Previous year figures have been regrouped and rearranged, wherever
necessary.
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