1. Tulip Star Hotels Limited was incorporated on 19th September 1987. Currently the shares of Tulip Star Hotels Limited are listed on Bombay stock Exchange. Tulip Star Hotels Limited is in the business of Owning and Managing Hotels. The financial statements were authorised for issue by the Board of Directors on 29th May, 2018.
Terms / rights attached to equity shares:
The company has only one class of equity shares having a par value of '10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.
In the event ofliquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts. The distribution will be in proportion to the number of equity shares held by the shareholders.
Out if the above remuneration of Rs. 1,74,050, Rs. 35,400 was paid to erstwhile Auditors.
2. The Company was a confirming party to a Master Asset Purchase Agreement (MAPA) entered into between V Hotels Ltd. (VHL) and Siddhivinayak Realties (P) Ltd. (SRPL) on 31.03.2005. The Company was required to place and has placed its entire shareholding in VHL in escrow in terms of Term Sheet dated 8th March 2005. VHL, vide its notice of arbitration dated 6th October 2005 terminated MAPA and the same was subject matter of arbitration before Sole Arbitrator Mr. Justice S.N. Variava (Retd.) duly appointed by Hon’ble Bombay High Court. An award was passed by the Ld. Arbitrator on 13 th July 2011 holding that SRPL has committed a repudiatory breach and hence is in default and therefore MAPA stands repudiated and terminated. This has been set aside by the Learned Single Judge of the Hon’ble Bombay High Court in an arbitration application filed by SRPL u/s 34 of the Arbitration and Conciliation Act, 1996 vide his order dated 10th May 2013. As per the said order, the Learned Single Judge has only set aside the award passed by the Ld. Sole Arbitrator and has not passed any orders decreeing the counter claims of SRPL. VHL has moved an appeal before the Hon’ble Division Bench of Hon’ble Bombay Court challenging the order dated 10th May 2013. The said appeal has been admitted on 3rd February 2014 and presently pending for final hearing and disposal. In view of this, the Management is of the opinion that The value of shareholding of the Company in V Hotels Ltd. remains undiminished as the rights, title and interest of V Hotels Ltd. in its Hotel property is not adversely affected by the decision of the Learned Single Judge.
3. The Company holds long term investments of Rs. 21,99,82,000 in the equity shares of V Hotels Ltd. which owns Hotel Tulip Star, Mumbai. The operations of the said hotel have been suspended since April, 2005 due to operational and financial constraints. The management of V Hotels Ltd. has conveyed its intention to put into action a business plan with immediate effect, in order to resume commercial operations of the said Hotel. In view of this, the Management is of the view that its investment in V Hotels Ltd. retains its strategic value.
4. M/s Asset Reconstruction Company (India) Limited (ARCIL) (to whom certain Banks have assigned their loans, which were advanced by them to V Hotels Limited) has initiated action under the Securitization & Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARAESI Act) for recovery of its dues. V Hotels Ltd. has informed the Company that the said matter is under legal adjudication and ARCIL cannot initiate any precipitative action against the assets of VHL. The Management of the Company has evaluated the effect of the developments on its equity shareholding in V Hotels Ltd. as well as on its exposure of Rs. 37,00,00,000 by way of Interest Free Loan in that company and is of the opinion that as the intrinsic underlying asset of V Hotels Ltd., being the hotel property, continues to remaining its ownership and possession and its estimated market / realizable value being far in excess of its aggregate liabilities, the investment in V Hotels Ltd. has not suffered permanent diminution nor is there a present threat to the recovery of its ICDs in V Hotels Ltd.
5. CONTINGENT LIABILITIES :-
a) The Company has given guarantees to banks and a finance company for repayment of loans and all amounts payable thereon in consideration of loans aggregating to '13,352 lacs (Previous Year '13,352 lacs) disbursed/guaranteed by them to V Hotels Ltd., the erstwhile wholly owned subsidiary of the Company.
B) Penalty notice u/s 221(1) of the Income Tax Act 1961 for '40.34 Lacs for the non payment of Income Tax dues.
6. RELATED PARTY DISCLOSURES :
a) Related parties with whom transactions have taken place during the year.
Associates: -Cox & Kings Ltd.
Tulip Hotels Pvt. Ltd.
V Hotels Ltd.
Tulip Star Leisure & Health Resorts Ltd.
ABK Enterprises Pvt. Ltd.
Key management Personnel: -
Mr. A. B. M. Good
Dr. Ajit B. Kerkar
Ms. Ramola Mahajani
Mr. M. Narayanan
Mr. Pesi S. Patel
Mr. Shailesh S. Mody
Mr. Sheel Dhar Pande
Mr. Dwarakanath Boppana
Late Mr. Sanjeev D Shenvi (Part of the year)
Mr. Shaunak A Paigankar
7. The Company has not received any intimation from “Suppliers” regarding their status under Micro, Small & Medium Enterprises Development Act, 2006 and hence the disclosures if any, relating to amounts unpaid as at the year end together with interest paid/ payable as required under the said Act have not been given.
8. Previous year’s figures have been regrouped / reclassified wherever necessary.
9. Balance confirmations have not been obtained in respect of year end balances of Sundry Creditors, Loans and Advances due to / by the Company (excluding group and associate companies) and some of the Bank Accounts.
10. The Company has received copies of letters issued by the Dy. Commissioner of Income Tax, Circle — 16(1), New Delhi to some of the Company’s bank under section 226(3) of the Income Tax Act, 1961 directing these banks to remit moneys in the Company’s accounts to the Income Tax Department towards settlement of the Company’s tax dues.
11. Financial instruments - Fair values and risk management
A. Accounting classification and fair values
The following table shows the carrying amounts and fair values of financial assets and financial liabilities including their levels in the fair value hierarchy. It does not include fair value information for financial assets and financial liabilities if the carrying amount is a reasonable approximation of fair value.
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices);
Level 3: Inputs for the asset or liability that are not based on observable market data.
Following methods and assumptions are used to estimate the fair values:
Fair value of Other Bank Balances, Term deposits, Long Term borrowings, Other Current Liabilities and Short Term Borrowings carried at amortized cost which is not materially different from it’s carrying cost largely due to short term maturities of these financial assets and liabilities.
Loan to Associate Company, Other Loans & Advances and other investments are categorized under Fair Value Through Profit & Loss and qualify for valuation under Level 3 inputs. In the opinion of the management the carrying values of these financial assets represent their fair value.
Set out below is a comparison by class of the carrying amounts and fair value of the Company’s financial instruments that are recognized in financial statements.
B. Measurement of fair values
i) Transfers between Levels 1 and 2
There have been no transfers between Level 1 and Level 2 during the reporting periods.
ii) Level 3 fair values
Non-listed shares and other securities fall within level 3 of the fair value hierarchy.
C. Risk Management
The Company’s present scale and volume of activities exposes it to credit risk and liquidity risk. This note explains these risks and how the Company manages these risks.
The Company’s risk management is carried by the senior management under reporting to the Board of Directors.
1. Credit risk
This risk arises from a party to a financial instrument failing to discharge its obligation causing a financial loss to the Company. The Company’s exposure in respect of financial instruments mainly comprises of interest free advance to an associate company repayable on demand and interest free advances to employees.
The management keeps a close watch on the affairs of the associate company and thus ensures that the ultimate recovery of its loans is not at risk.
Loans to employees are recovered through salaries of present employees and through end of service dues of employees leaving the Company’s service.
2. Liquidity risk
This is a risk that the Company may encounter difficulties in meeting its obligations associated with financial liabilities on account of its credit risk.
The management mainly has obligations towards repayment of loans from associates and group companies and has appropriate understanding with these companies for repayment of these loans which is co-related with recovery of its loan from the associate company.
12. Disclosure as per IND AS 19 (Revised) “Employee Benefits” are as under:
Defined contribution plan
Contribution to Defined Contribution Plan, recognized are charged off for the year are as under:
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