| The Company has only one class of share referred to as equity shares
having a par value of Rs.10/-. Each holder of equity shares is
entitled to one vote per share In the event of liquidation of the
Company, the holders of equity shares will be entitled to receive any
of the remaining assets of the Company, after distribution of all
preferential amount. The distribution will be proportionate to the
number of equity shares held by the share holders.
1.1 The company has issued Foreign Currency Convertible Bonds (FCCBs)
of the nominal value of USD 50 million, having a maturity period of 5
years. As per the terms of the offering circular issued by the company
for FCCBs the bonds carry interest on 1% payable half yearly on 12th
February & 12th August respectively each year, and the Bonds are
convertible into fully paid equity shares of the Company at any time on
or after February 27, 2008 and up to January 29, 2013, unless
previously redeemed, converted or re-purchased and cancelled.
In accordance with the offering Circular dated February 01, 2008 issued
by the Company, under condition 6 (C ) (XXIX) of the said offering
Circular with effect from February 12, 2009 the Conversion Price of the
Bond is re-set at Rs. 282.27 from Rs. 376.36. Further, during the year
2013-14, due to the stringent financial position, the Company has not
been able to discharge its interest payment obligations of Rs. 306.08
Lacs on the said Bonds, which was due for payment on 12th August 2013 &
12th February 2014.
As per the Offering Circular, in the event of non-conversion of said
Bonds into equity shares of the Company, the same shall be redeemed at
137.24 % of principal amount. The management has not made any provision
in the books of account towards any liability that may fall on the
Company, in the eventuality of redemption of the Bonds.
1.2 Foreseeing the huge developments taking place in MENA market
(Middle East, North Africa) the Company undertook huge expansion plans
and had taken up multiple projects at the same time, and signed an
agreement with CNPC's subsidiary in China named BOMCO for 40 rigs for a
value of more than one billion US dollar, which business was to be
taken up by the wholly owned subsidiary company i.e. Petrogrema
overseas PTE. Ltd and substantial investment was made in the subsidiary
to facilitate the overseas body to setup the business of Oil rigs and
Mines. However, due to worldwide recession in the economy and
tightening of financial resources in the world market, company could
not size up funds that were required for 40 rigs which were committed
to CNPC, as a result of which payments made to CNPC as well as various
other suppliers got stuck and the monies advanced to them could not be
recovered because of financial closure and also the project could not
completed on time. The Company had signed mandates with 2 First Class
Banks and 1 top M&A firm from U.K who were not able to raise the debt
as required due to financial recession worldwide.
All the above has resulted in huge losses to its wholly owned
subsidiary company i.e. Petrogrema Overseas Pte. Ltd. resulting in
complete erosion of its Net worth. In view of the above, as a
conservative approach and in line with the accounting policy on
diminution of investment being followed by the Company, the management
decided to write off the value of investments in its subsidiary as well
as Loans by Rs. 8193.22 Lacs and Rs. 3120.92 Lacs respectively during
the financial year 2011-12.
During the financial year 2012-13 the wholly owned subsidiary company
i.e. Petrogrema Overseas Pte. Ltd has incurred heavy losses due to
written-off of various loans & advances (Rs.103.31 Crores) which could
not be recovered as per the view ofthe management and become bad due to
various reasons mentioned hereinabove.
During the financial year 2013-14 the management decided to write off
the remaining value of investments in its subsidiary as well as Loans
by Rs. 8193.22 Lacs and Rs. 3120.92 Lacs respectively with due reason
that the wholly owned subsidiary company i.e. Petrogrema Overseas Pte.
Ltd has incurred heavy losses due to written-off of various loans &
advances (Rs.103.31 Crores) in past years which could not be recovered
as per the view of the management and become bad due to various reasons
mentioned hereinabove.
1.3 The management of company has observe that part of the block of
assets (Equipments/Machineries) become obsolete due to efflux of time,
wear and tear and more so due to technological obsolescence and have
very little or scrap value. Further, the cost of operations and
maintenance of such old machines is high as such could not withstand
the competition from the similar modern machines/equipments in the
market. The gross block/value of such types of assets is approx. 26
Crores.
1.4 The accumulated loss of the Company as on 31.03.2015 is more than
100% of its net worth during the year and immediately preceding the
financial year and as such falls within the definition of "sick
industrial Company" under section 46(AA) (i) of the Companies (Second
Amendment) Act, 2002 . The Net Worth of the company had also been
eroded during the financial year 2011-12 itself resulting, the Company
had become a sick industrial company within the meaning of section
3(1)(o) of the Sick Industrial Companies (Special Provisions) Act,
1985.
The company has made a reference during the financial year 2012-13 to
the "Board for Industrial & Financial Reconstruction" under section
15(1) of Sick Industrial Companies (Special Provisions) Act 1985
however the same reference has been declined by BIFR.
1.5 There is an inquiry has been initiated by "office of Registrar
of companies (West Bengal)" for contravention of provisions of the
companies Act, 1956 however the company has filed the application
for compounding of offences under the said Act.
1.6 Contingent Liabilities :-
(i) Liability towards Corporate and Bank guarantees:-
(Rs. in Lacs)
Particulars 31.03.2015 31.03.2014
a) Contingent Liability
not Provided for
b) Bank Guarantee 29.00 29.00
c) Corporate Guarantee
(As per the sanctioned 57965.00 57965.00
Limit) given to and on
behalf of the following
Group Companies :-
1) Greenearth Resources & Pojects Ltd.
2) New saw Infraprojects Ltd.
3) SanciaInfraglobal Private Limited
(ii) Service Tax Liability:- There was an inquiry operation on 04th day
of June, 2014 conducted by DGCEI, Zonal Unit, Mumbai to ascertain facts
regarding evasion of the service tax under Central Excise Act, 1944
read with section 83 of the finance act, 1994. However the service tax
liability is not materialize.
1.7 The company does not possess information as to which of its
suppliers are ancillary industrial undertaking/small scale industrial
undertaking holding permanent registration certificates issued by the
Directorate of Industries of a state or union territory, consequently
:-
a) The total outstanding dues of small scale industrial undertaking
cannot be ascertained.
b) The names of the small scale industrial undertaking to whom the
company owed sums for more than 45 days cannot be ascertained.
1.8 Details of Managerial remuneration under section 198 of the
companies Act, 1956
Salaries and Allowances Rs. 8.63 Lacs
Sitting Fees to Non-executive Directors Rs. 0.40 Lacs
1.9 The Company has the following wholly owned Subsidiary, the details
are as under:
Petrogrema Overseas
Name of the subsidiary PTE Limited
Country of incorporation or
residence Singapore
Proportion of ownership interest 100%
The Subsidiary of the Company has incurred h eavy losses, which has
also affect the assumption of going concern of Subsidiary company.
1.10 Segment Reporting:
During the financial year 2014-15 the company was primarily engaged in
single business segment viz Rental/ Hiring of construction Equipments
/machineries and further the Company does not have any material
earnings emanating outside India, the Company is Considered to operate
only in the domestic segment .
Enterprises under the control of Key Managerial Personnel of the
company:-
a. Sancia Infraglobal Private Limited
Subsidiary Company a. Petrogrema Overseas Pte. Ltd.
1.11 Earnings per Share (EPS):
The basic earnings per share ("EPS") is computed by dividing the
Net Profit after tax for the year by the weighted average number of
equity shares. For the purpose of calculating diluted earnings per
share, Adjusted Net profit after tax for the year and the weighted
average number of shares outstanding during the year are adjusted for
the effects of all dilutive potential equity shares. However we have
not reported diluted "EPS" since the potential equity shares are
Anti-dilutive in nature.
As per AS-22 "Accounting for Taxes on Income", deferred tax assets
should be recognized and carried forward only to the extent that there
is a reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realized.
The Net worth was fully eroded and the management was not expecting any
taxable income in the near future and accordingly Deferred Tax Assets
(DTA) is recognized to the extent of Deferred Tax Liability (DTL).
1.12 During the F.Y 2013-14 M/s Suryoday Allo Metal Powders Limited, a
company registered under the companies Act, 1956 and having its
Registered office at 302, B- Wing, Narayan Chamber, 555 Narayan Peth
Pune- 411030 (Maharashtra) filed a legal suit in the court at Kolkata
for winding-up the company due to defaulting of payment of
Rs. 1,04,19,948/- by M/s Sancia Global Infraprojects Limited.
1.13 The Company has defaulted in making payments to secured creditors
and also not provided for interest on the banking facilities availed
from the banks. The secured creditors had declared the account as a Non
Performing Asset (NPA) and initiated notice under Section 13(2) as per
the SARFAESI Act 2002. Further Bank of India have assigned all the
rights, title and interest in financial assistance in favour of
"Edelweiss Asset Reconstruction Company Limited (EARC)" vide letter
No. EdelARC/3985-2014 dated April 30, 2014 received from "Edelweiss
Asset Reconstruction Company Limited."
21.17 During the financial year 2011-12 the company had acquired the
assets & liabilities of its associate company i.e. M/s Sancia
Infraglobal Private Limited. However the same transaction could not
completed due to not getting the requisite approvals from the relevant
authorities and being restated.
21.18 Previous year's figures have been re-grouped, re-classified and
rearranged wherever necessary.
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