1. (Note [7.2] of Standalone Financial Statement)
The Company is in default in respect to the repayments long term debts of Principal and Interest as under:
2. (Note [7.3] of Standalone Financial Statement)
The Company is in default in the payment of interest to Foreign Currency Convertible Bonds holders:
3. (Note [25] of Standalone Financial Statement)
Contingent Liabilities & Commitments (to the extent not provided for)
a. Income-tax, Sales-tax, Customs and Excise Duty matters pending in appeals etc. Rs.17013.71 lakhs (Previous year Rs. 16991.80 lakhs) (net of Bank Guarantee of Rs 3.00 lakhs included in (b) below (Previous year Rs. 3.00 lakhs)
b. Outstanding guarantees furnished by Bankers Rs.6.15 lakhs (Previous year Rs.6.15 lakhs).
c. Claims against the Company not acknowledged as debts Rs.20880.52 lakhs
(Previous year Rs. 18601.44 lakhs).
d. Unexecuted capital commitments (net of advances) Rs.18.76 lakhs (Previous year Rs. 150.77 lakhs)
(i) The Company's pending litigations comprise of claims against the Company and proceedings pending with Tax Authorities. The Company has reviewed all its pending litigations and proceedings and has made adequate provisions, wherever required and disclosed the contingent liabilities, wherever applicable, in its financial statements. The Company does not expect the outcome of these proceedings to have a material impact on its financial position.
(ii) The Company periodically reviews all its long term contracts to assess for any material foreseeable losses. Based on such review wherever applicable, the Company has made adequate provisions for these long term contracts in the books of account as required under any applicable law/accounting standard.
(iii) The Company neither entered into any derivative contracts during the year nor have any outstanding derivative contract at year end.
4. (Note [26] of Standalone Financial Statement)
Balances of some of the Trade Receivables, Trade Payable, Lenders, loans and advances are subject to confirmation from the respective parties and consequential adjustments arising from reconciliation, if any. The management however is of the view that there will be no material adjustment in this regard.
5. (Note [27] of Standalone Financial Statement)
The Company is in the process of restructuring/revival of its business under the aegis of BIFR which inter alia includes finalization of the product plan. The process of possible utilization of slow / non-moving items of inventory will be undertaken upon - finalization of the product plan, approval and implementation of the restructuring/revival scheme. Pending such ascertainment/ determination the management has considered the inventories except finished goods at cost. Requisite accounting effect, if any, will be given upon such ascertainment/ determination, approval and implementation of the revival scheme.
6. (Note [30] of Standalone Financial Statement)
The Company became a Sick Industrial Company within the meaning of Section 3(1)(O) of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) due to erosion of its net worth and the Company -was declared a Sick Industrial Company by BIFR on 8th May, 2007. The Company resumed operations in a small way from April, 2007 and is working inter-alia on the development of various new products and technologies and production of new generation vehicles. The Company had earlier submitted its draft revival scheme to BIFR. As directed by BIFR, the Company had since submitted the updated revival scheme. In view of this, the accounts have been prepared on the basis of going concern.
7. (Note [31] of Standalone Financial Statement) Settlement of dues
a) The Company had executed a Multipartite Agreement on 28th March, 2005 (MPA) with all its Secured Lenders (SL). The Company is in default in re-payment of principal and payment of interest to its SL. The draft Revival Scheme submitted to BIFR inter-alia takes into consideration the matter relating to the dues of SL.
b) The Company has obtained approval(s) from SL (representing 96.69% by value) regarding the settlement of their dues, which will come into effect from the date of sanction of its Revival Scheme by BIFR. Upon approval of the Revival Scheme by BIFR, the approvals of the SL will form an integral part of the MPA and accordingly the MPA shall stand modified / amended to that extent. Pending approval of the Revival Scheme by BIFR, applicable interest has been provided on the defaulted amount for the year.
8. (Note [32] of Standalone Financial Statement) Deferred Taxation:
In terms of Para 26 of AS-22 "Accounting for Taxes on Income" issued by the Institute of Chartered Accountants of India, the Company has reviewed the Deferred Tax Assets (DTA), recognized as on 31st March, 2016 at the Balance Sheet date. In the context of - uncertainty of generation of profits in near future, Deferred Tax Assets has not been recognized.
11. (Note [34] of Standalone Financial Statement)
Earnings Per Share (EPS) computed in accordance with Accounting Standard 20 issued by The Institute of Chartered Accountants of India.
Shri R K Srivastava - Whole-time Director, Shri Khushahal Chand Agarwal - Sr. President (Commercial) & Company Secretary and
Shri Mahesh Kumar Kanodia - Chief Financial Officer.
(i-c) Enterprises over which Directors and their relatives are able to exercise significant influence:
Smart Chips Limited, Suryodaya Investment
& Trading. Co. Limited, Mahalaxmi Holdings Limited, Payal Investments & Trading LTD, Mimosa Finance & Trading Limited, Bina Fininvest P. Limited, Ginideep Finance & Investments P. Limited, Gold Rock Investments Limited, Gold Rock Metals Limited, Gold Rock World Trade Limited, Blue Point Leasing Limited, Gold Rock Agro-Trading Limited, Tridhar Finance & Trading Limited, Picanova Investments P. Limited, Inlac Granston Limited, Shree Dhan Sharda Mercantile P Limited, B.S. Infotech P. Ltd, Ind Hi-Tech Enterprises Pvt. Limited, Saryu Investment & Trading P. Limited, Panki Roadlines Pvt. Limited, Sugata Investment Limited, Gold Rock Agrotech Limited, Syscom Corporation Limited, Seattle Ontime P. Limited
[ii] There is no provision for doubtful debts or amounts written off or written back during the year in respect of dues from or to related parties.
[iii] Summary of Transactions with related parties:
9. (Note [36] of Standalone Financial Statement)
In the absence of information from Trade Payable regarding status under The Micro, Small and Medium Enterprises Development Act, 2006, liability of interest if any cannot be reliably estimated, nor required disclosures can be made.
10. (Note [37] of Standalone Financial Statement)
Related Party Disclosures:
(i-a) Associate : VCCL Limited (i-b) Key Management Personnel
Shri Deepak Kumar Singhania - Chairman & Managing Director,
Shri. Lalit Kumar Singhania - Whole-time Director,
Shri Anurag Kumar Singhania - Whole-time Director,
Details of related parties transactions:
Associate: All transactions and outstanding balance are with VCCL Limited.
Key Management Personnel: Remuneration to Shri Deepak Kumar Singhania Rs.17.96 lakhs (Previous year Rs. 17.76 lakhs), Shri. Lalit Kumar Singhania Rs.17.75 lakhs(*) (Previous year Rs. 9.51 lakhs), Shri Sanjeev Shriya Rs.Nil (Previous year Rs. 1.89 lakh*), Shri Anurag Kumar Singhania Rs.17.89 lakhs (Previous year Rs. 9.84 lakhs) and Shri R K Srivastava Rs. 18.00 lakhs (Previous year Rs. 18.00 lakhs), Shri Khushahal Chand Agarwal Rs. 41.75 lakhs (Previous year Rs.41.86 lakhs), Shri Mahesh Kumar Kanodia Rs. 21.95 lakhs (Previous year Rs.21.93 lakhs).
* During the previous year up to 17/07/2014
(*) Company's application for re-appointment and payment of remuneration is pending with Ministry of Corporate affairs w.e.f.28.03.2016.
Enterprises over which Directors & their Relatives are able to exercise significant influence: Mimosa Finance & Trading Limited Rs. Nil (Previous year Rs.2.40 lakhs), B.S. Infotech P. Limited Rs. nil (Previous year Rs.0.33 lakh). Others less than 10% Rs. Nil (Previous year Rs.0.13 lakh).
11 (Note [38] of Standalone Financial Statement)
Business Segment :
(a) Primary (Business) Segment
The operations of the Company relate to only one segment viz. Motorized Two-Wheelers.
(b) Secondary (Geographical) Segment
12. Secondary segment reporting is on the basis of geographical location of the customers. The Company's revenue during the year by geographical markets are : Domestic Sales Rs.1781.80 lakhs (Previous year Rs. 4782.86 lakhs) and Export sales Rs.13534.87 lakhs (Previous year Rs.15151.37 lakhs)
13. Geographical segment wise loss and capital employed are not given since the production unit and administrative expenses are common.
14 (Note [39] of Standalone Financial Statement)
The Company has carried out impairment test on its Fixed Assets as on 31.03.2016 and the Management is of the opinion that there is no asset for which impairment is required to be made as per Accounting Standard-28 on Impairment of Assets issued by ICAI.
15. (Note [47] of Standalone Financial Statement)
Figures of the previous year have been regrouped and recanted wherever necessary to make them comparable.
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