| 1. Contingent Liabilities
Particulars 31.03.2013 31.03.2012
Rs. '000 Rs. '000
a) Claims against the company
not acknowledged as debts 23,205 31,443
b) Guarantees given
to Banks on behalf of subsidiaries
& others 3,268,050 4,183,550
c) Counter guarantees to bankers
against guarantees issued
by them to customers (secured by
a charge on current assets) 82,760 68,240
d) Disputed Tax demands under appeal
(i) Income Tax/penalty 338,923 328,000
(ii) Sales Tax 21,733 17,251
(iii) Excise Duty 86 86
Total 3,734,757 4,628,570
2. Arrears of cumulative preference dividend and tax thereon -
Rs.71,881 thousands (as of 31.03.2012-Rs. 65,542 thousands).
3. The Company has not been informed by any supplier of their being a
Micro and Small Enterprise and as defined under the Micro Small and
Medium Enterprises Development Act 2006 and hence no disclosure has
been made in respect of dues to such units if any outstanding for more
than 45 days.
4. The Company has an outstanding export obligation of Rs.1,563 Lakhs
on account of imported machinery to be fulfilled within 8 years after
commencement of production of machinery division.
5. Note on Investments
The Company has invested in certain strategic verticals through
subsidiaries which are under direct control of the Company. The present
status of these subsidiaries is as under:- a) B&C Machinery Limited -
Rs. 71.77 Crores
The substantial investment in this subsidiary has been made under the
direct supervision of the promoter, who envisages bright opportunities
for the subsidiary. As the unit is under construction and nearing
completion, there is no impairment in the value of investment.
b) Best & Crompton Apparels Limited - Rs.18 Crores
The modern state of art apparel manufacturing unit was commissioned
with the expectation that the products mainly sports apparel would
become the preferred choice of the sporting community.
The promoter's holding the entire equity through the company and
overseas company owned by the promoter.
Unfortunately the products could not withstand competition from
international brand apparels. Due to inadequate demand volume, lack of
working capital and relatively weak marketing setup the unit could not
even recover the prime cost leading to the closure of the unit
precipitating agitation by workers and action by the lending
institution. The promoter is examining the probability of reviving the
unit; alternatively relocating the factory overseas after making
arrangement for one time settlement with the lending institution.
According to the management impairment in the carrying value of plant &
machinery because of non-usage would not be significant. The aggregate
market value of land and factory building and fair value of plant and
machinery is more than the carrying values shown in the Balance sheet;
however an updated technical evaluation of the unit and the guideline
value of the land would be undertaken to quantify diminution in the
value, if any, during the following year.
The periodical cash funding for the unit over the years is being
critically reviewed in the context of their end use and necessary
adjustment would be made in the accounts of the following year.
c) Crombest Precast Buildings Limited - Rs.29.08 Crores.
The modern prefabricating building factory unit has been functioning
but slow down its activities due to unecnomical operation resulting in
the eventual closure. The starting of the work in the opinion of the
management could be reviewed with the present boost in the reality
business. The promoter is making the critical assessment of the
economic overview of the industrial segment: however the present value
of extensive land and building together with the Plant & Machinery
would not impair the carrying value of the investment.
The lending Institution of two subsidiaries have, due to non repayment
of dues, referred the matter to Debts recovery Tribunal, Chennai and
also taken action under 'SARFAESI' Act to ensure recovery from these
Companies. There is at present, no invocation of guarantees against the
Company. However, the subsidiaries are all negotiating with the lending
banks for one time settlement / installment payments and progress has
been made in this direction.
The promoter group has been infusing significant funds whenever the
company has been in dire need and is committed to keep the operating
unit going and to honour the commitments to the lending institution and
negotiations are in progress for one time settlement with them. The
Promoter group is endeavouring to restart the closed units.
In view of what has been stated in the preceding paragraphs the
company's accounts are presented on principles applicable to a "Going
Concern".
6. Best & Crompton Green Tech Limited an Associate Company has been
fully disinvested with effect from 21st January 2013.
7. Loans and Advances include Rs. 21.38 Cr. given in earlier years
towards project advances of Rs. 21.38 Cr. This advance would be
adjusted upon commencement of the project. In the opinion of the
Management, these advances though unsecured are good and no provision
is necessary.
8. The Company owes as on the date of the Balance sheet Rs. 57.45 Cr.
to IL&FS which due to nonpayment on time has resulted on the
Institution moving the Court for creditors winding up since the close
of the financial year, for which a stay has been obtained. The promoter
group had submitted to the court a schedule of repayment in this
regard.
9. Loans and advances include an amount of Rs. 2,787 lakhs received
from PT Multikarsa Investama, Jakarta towards advance for exports (USD
5,771,646 as of March 2013) against contracts for development and
manufacture of products for exports from our factories. The exports of
these products will be beyond one year from the date of receipt of
advance payment and the Company is in compliance to Notification No.
FEMA,23/RB-2000, dated 3rd May 2000. As these items are long lead
delivery items which are subject to various approvals and clearances
from the exporter before final execution of the contract.
10. Trade recoverable and loans and advances exceeding six months are
classified as doubtful have all been fully provided for even though
continuing efforts are being made for their recoveries.
11. The Company's financial statements have not been authenticated by
the Group Chief Executive Officer of the Company, as he is presently
out of country. The Company has not appointed a Chief Financial
Officer; the relevant duties are being discharged by the Whole Time
Director.
12. As in the Balance sheet, the figures in the Profit and Loss Account
have been expressed in terms of Rupees in thousands.
13. Previous year figures have been regrouped, rearranged or
reclassified to conform to schedule VI (as annexed) of the Companies
Act 1956.
|