| 1.1 Secured Loans
a) Rupee Term Loan from Banks
The Company alongwith 12 other affiliates/entities (collectively
referred to as 'Obligors' and individually referred to as
'Borrower') executed facility agreement with consortium of existing
domestic rupee term lenders, in the obligor/co-obligor structure,
wherein all the Rupee Term Loans of the Obligors are pooled together.
The Borrower entities covered are Videocon Industries Limited (VIL),
Value Industries Limited, Trend Electronics Limited, KAIL Limited,
Millennium Appliances India Limited, Applicomp (India) Limited, Sky
Appliances Limited, Techno Electronics Limited, Century Appliances
Limited, PE Electronics Limited, Techno Kart India Limited (formerly
Next Retail India Limited), Evans Fraser and Co. (India) Limited and
Videocon International Electronics Limited.
Rupee Term Loans from Banks are secured by first pari-passu charge on
all present and future tangible/intangible assets (excluding the
Identified Properties) of each of the Borrower, first pari-passu charge
on the Trust and Retention Accounts of the Borrowers, second pari-passu
charge on Identified Assets of Videocon Hydrocarbon Holdings Limited's
(VHHL) subsidiaries through pledge of entire shareholding of VHHL in
these overseas subsidiaries, second charge on pledge of 100% shares of
Videocon Oil Ventures Limited and VHHL, second pari-passu charge on
VHHL's share of cash flows from Identified Assets and second pari-
passu charge over current assets of each of the Borrowers. The Rupee
Term Loans are also secured by first ranking pledge over specified
numbers of equity shares of Videocon Industries Limited, Trend
Electronics Limited and Value Industries Limited held by the promoters,
the personal guarantee of Mr. Venugopal N. Dhoot, Mr. Pradipkumar N.
Dhoot, Mr. Rajkumar N. Dhoot and first pari-passu charge on
'Videocon' brand (Also refer Note No. 33).
b) Vehicle Loan from Banks are secured by way of hypothecation of
vehicles acquired out of the said loan.
1.2 The Company has availed interest free Sales Tax Deferral under
package incentive scheme of 1993. The sales tax collected during the
deferral period is payable in five annual installments, after
completion of ten years from the year in which the tax was collected.
2.1 Working Capital Loans from Banks are secured against hypothecation
of the Company's stock of raw materials, packing materials,
stock-in-process, finished goods, stores and spares, book debts and all
other current assets of the Company. The loans are further secured by
corporate guarantee of Videocon Industries Limited and personal
guarantee of Mr. Venugopal N. Dhoot, Mr. Rajkumar N. Dhoot and Mr.
Pradipkumar N. Dhoot.
Note: This information as required to be disclosed under the Micro,
Small and Medium Enterprises Development Act, 2006, has been determined
to the extent such vendors/parties have been identified on the basis of
information available with the Company.
3. As required by Accounting Standard 29 "Provisions, Contingent
Liabilities and Contingent Assets" issued by the Institute of
Chartered Accountants of India, the disclosure with respect to
Provision for Warranty and Maintenance Expenses is as follows:
4. EMPLOYEE BENEFITS:
Disclosure pursuant to Accounting Standard (AS) 15 (Revised):
A) Defined Contribution Plans:
Amount of Rs. 5.86 Million (Previous year Rs. 6.71 Million) is recognised
as an expense and shown under the head "Employee Benefits Expense"
(Note No. 24) in the Statement of Profit and Loss.
V) Actuarial Assumptions
a) Discount Rate - 8% per annum
b) Mortality - Indian Assured Lives Mortality
(2006-08) Ultimate
c) Turnover Rate - 5% at younger ages reducing to 1%
at older ages
d) Future Salary
Increase - 5% per annum
5. RELATED PARTY DISCLOSURES:
As required under Accounting Standard 18 on "Related Party
Disclosures", the disclosure of transaction with related parties as
defined in the Accounting Standard are given below:
A) List of Related Parties where control exists and related parties
with whom transactions have taken place and relationship:
Key Management Personnel: Mr. J. L. Bangad - Head Operations
B) Material Transactions with Related Parties during the year are:
Remuneration paid to the Key Management Personnel - Rs. 4.69 Million
(Previous year Rs. 3.08 Million)
Rs in Million
As at As at
31st Dec.2014 31st Dec2013
6. CONTINGENT LIABILITIES NOT
PROVIDED FOR:
i) Letters of Credit opened 1,107.23 1,181.29
ii) Letters of Guarantees 4.96 3.76
iii) Claims against the Company
not acknowledged as debts
a) Custom Duty demands and penalties
under dispute 0.75 4.06
b) Excise Duty and Service Tax demands
and penalties under dispute 15.46 15.70
c) Sales Tax demands and penalties
under dispute 51.29 62.18
[Amount paid under protest 18.27 Million
(Previous year Rs. 17.17 Million)]
iv) Income Tax matters in respect of
which appeals are pending 8.21 8.21
7. The Company alongwith 12 other affiliates/entities (collectively
referred to as 'Obligors' or individually as 'Borrower') executed
Facility Agreement with the consortium of existing domestic rupee term
lenders, under the obligor/co-obligor structure, wherein all the Rupee
Term Loans of the Obligors are pooled together. The Borrower entities
are Videocon Industries Limited, Value Industries Limited, Trend
Electronics Limited, KAIL Limited, Millennium Appliances India Limited,
Applicomp (India) Limited, Sky Appliances Limited, Techno Electronics
Limited, Century Appliances Limited, PE Electronics Limited, Techno
Kart India Limited (formerly Next Retail India Limited), Evans Fraser
and Co. (India) Limited and Videocon International Electronics Limited.
As the Company is a co-obligor, it is contingently liable in respect of
the borrowings of other Obligors/Borrowers to the extent of outstanding
balance of Rupee Term Loans as on 31st December, 2014 of Rs. 195,264.92
Million (Previous year Rs. 192,416.49 Million).
8. The Directorate of Revenue Intelligence, Mumbai Zonal Unit
('DRI'), has on 30th December, 2014, issued a Show Cause Notice
('SCN') in connection with import of Colour Picture Tubes ('CPTsRs.)
by the Company and other concerns. The DRI has alleged that the Company
has resorted to over-valuation of CPTs, for High Sea Sales made by the
Company, leading to evasion of anti-dumping duty. Vide SCN, the Company
was called upon, amongst others, as to why the penalty should not be
imposed on them under Section 112(a) of the Customs Act, 1962.
The Company has denied the allegation made by DRI for alleged evasion
of duty and/or imposition of penalty. The Company has been advised by
its counsels that as the goods in question are not domestically
produced or manufactured in India, the question of levy of anti-dumping
duty is untenable and, accordingly, there is no question of penalty
thereon.
9. The Company is primarily engaged in manufacturing and trading of
Electrical and Electronic Appliances and there is no other reportable
segment as defined in Accounting Standard 17 on "Segment
Reporting".
10. The outstanding balances of certain Trade Receivables, Trade
Payables, Deposits, Advances and Other Current Assets/ Liabilities are
subject to confirmation and reconciliation, if any. However, in the
opinion of the management, adjustment, if any, will not be material.
11. In the opinion of the Board, the value on realisation of Current
Assets, Loans and Advances in the ordinary course of the business would
not be less than the amount at which they are stated in the Balance
Sheet and the provision for all known and determined liabilities is
adequate and not in excess of the amount reasonably required.
12. There are no amounts due and outstanding, to be credited to the
Investor Education and Protection Fund.
13. Figures of previous year have been reclassified, restated, recasted
to conform to the classification of the current year.
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