Rights, Preferences and Restrictions attached to equity shares.
i) Right to receive dividend as may be approved by the Board of Directors / Shareholders at the Annual General Meeting.
ii) The equity shares are not repayable except in the case of a buy back, reduction of capital or winding up in terms of the provisions of the Companies Act, 2013.
iii) Every member of the Company holding equity shares has a right to attend the General Meeting of the Company and has a right to speak or e-vote and on a show of hands, has one vote if he is present and on a poll shall have the right to vote in proportion to his share of the paid-up capital of the Company.
Notes:
1. Includes an amount of RS.156.76 (in lakh) [Previous Year - RS.7,144.06 (in lakh)] being disputed income tax liabilities pertaining to IT / ITES business, which is reimbursable from Hinduja Global Solutions Limited, pursuant to the Scheme of Arrangement and Reconstruction for demerger of IT / ITES business sanctioned by High Court of Judicature of Bombay and made effective on 7th March, 2007. In respect of the aforesaid disputed dues, an amount of RS.5,196.15 (in lakh) [Previous Year - RS.3,507.19 (in lakh)] has been deposited by the Company with income tax authorities under protest. The Company has received RS.3,318.99 (In lakh) upto 31st March, 2018 from Hinduja Global Solutions Limited to discharge part payment of disputed income tax liabilities pertaining to IT / ITES business, which is netted from advance tax and tax deducted at source (net of provisions).
2. As per the assessment order u/s 143(3) of Income Tax Act, 1961 dated 27th December, 2017 for the A.Y. 2015-16, a demand of RS.39,027,640.00 [Previous year R Nil (in lakh)] is made, of which the Company has deposited RS.7,808,000.00 as a deposit for getting a demand stay (20% of the amount demanded).
With respect to the above, the Company does not expect any outflow of cash / resources.
(B) Other commitments:
a) Grant Investrade Limited (“GIL”), a wholly owned subsidiary of the Company (upto 30th September, 2017 - Refer Note No. 46) had in the financial year 2014-15, availed a Loan against share facility of RS.29,500.00 lakh [Previous year RS.29,500.00 (in lakh)] from Yes Bank Limited (“YBL”) repayable afteRs.96 months from the date of disbursement. The Company has given an undertaking to YBL that in the event of any shortfall, the Company will infuse additional equity in GIL towards time, cost overrun and losses during the tenor of the loan. Upon demerger of HITS business, with effective date of 1st October, 2016, from GIL to IndusInd Media & Communications Limited (‘IMCL’) (subsidiary of the company), the loan amount has been transferred from GIL to IMCL.
b) The Company has given an undertaking to three banks (i.e. Yes Bank Ltd., Axis Bank Ltd. and RBL Bank Ltd.) to retain shareholding to the extent of 51% in the subsidiary viz. IMCL and 100% in the subsidiary viz. GIL (upto 30th September, 2017 - Refer Note No. 46), until all amounts outstanding under various Facility Agreements entered into by IMCL and GIL with the said banks are repaid in full by IMCL and GIL respectively.
1 Operating leases
Where the Company is a lessee:
The Company has entered into cancellable leasing arrangement with IndusInd Media and Communications Limited (‘IMCL’), a subsidiary of the company relating to office premises extending upto a maximum of five years from the respective date of inception which are renewable on mutual consent. Lease rental of RS.106.56 (in lakh) [Previous Year - RS.104.44 (in lakh)] has been included in ‘Rent’ - Refer Note No. 26 of the financial statements.
Where the Company is a lessor:
The Company has entered into cancellable leasing arrangement with IndusInd Media and Communications Limited ‘(IMCL’), a subsidiary of the company, relating to lease of Dark Fibre Cable owned by the company extending upto a maximum of three years from the respective date of inception which is renewable on mutual consent. Lease rental income of RS.300.00 (in lakh) [Previous Year - RS.300.00 (in lakh)]. (Refer Note No. 20)
A cancellable operating lease of dark optic fibre cable was entered with Planet E-Shop w.e.f. 1st March, 2018, valid for four years and has recognised RS.263.56 lakh for the year ended 31st March, 2018 which has been included in ‘Lease income - Optical Fibre Cable’ - Refer Note No. 20 of the financial statements.
2 MAT credits
The Company has recognised Minimum Alternate Tax (MAT) credit as per the provisions of section 115JAA of the Income Tax Act, 1961 in the earlier years, which is carried forward for a period of fifteen year During the current year, the Company utilised MAT Credit of RS.1,488.82 lakh [Previous Year - R Nil]. The balance MAT will be set-off against the tax payable when the Company will fall under the normal tax rate. The convincing evidence of obtaining tax credit is supported by subsequent performance of the Company and subsisting business, which will ensure availability of sufficient future taxable income against which the above MAT credit will be adjusted.
3 Segment reporting Primary Segment
The Company’s primary business segments are reflected based on principal business activities carried on by the Company. The Company’s primary businesses are as under:
i. Treasury & Investment activities include trading of shares which the Company carries out on its own account, advancing of inter corporate loans and advances and sub-broking activities for shares.
ii. Media & Entertainment activities include the commercial exploitation of Dark Fibre owned by the Company as a licensee under the Telecom regulations and also its strategic investments in a subsidiary in the Cable TV Industry.
iii. Real estate activities include real estate assets (Land) acquired for the purpose of development in future. Secondary Segment
The Company operates solely in one Geographic segment namely “Within India” and hence no separate information for Geographic segment wise disclosure is required.
4 Related party disclosures (as identified by the Management)
I. Individual having control together with relatives and associates
Mr. Ashok P. Hinduja, Executive Chairman
II. Subsidiaries
A) Direct Subsidiaries
1. Grant Investrade Limited (upto 30th September, 2017) (Refer Note No. 46)
2. IndusInd Media & Communications Limited (Effective from 22nd August, 2017 as it was an indirect subsidiary upto the said date)
B) Indirect Subsidiaries
1. USN Networks Private Limited
2. Gold Star Noida Network Private Limited
3. Bhima Riddhi Infotainment Private Limited
4. United Mysore Network Private Limited
5. Apna Incable Broadband Services Private Limited
6. Sangli Media Services Private Limited
7. Sainath In Entertainment Private Limited
8. Sunny Infotainment Private Limited
9. Goldstar Infotainment Private Limited
10. Ajanta Sky Darshan Private Limited
11. Darpita Trading Company Private Limited
12. RBL Digital Cable Network Private Limited
13. Vistaar Telecommunication and Infrastructure Private Limited
14. Advance Multisystem Broadband Communications Limited
15. Amaravara Indigital Media Services Private Limited.
16. Vinsat Digital Private Limited (Effective from 2nd January, 2018)
III. Key Management Personnel
1. Mr. Ashok Mansukhani, Managing Director, w.e.f. 30th April, 2018 (Whole-Time Director upto 29th April, 2018)
IV. Enterprises where common control exists and with whom the company has transactions during the year
1. Hinduja Group Limited
2. Hinduja Realty Ventures Limited
3. Hinduja Global Solutions Limited
4. HGS International Services Private Limited
5. Hinduja Energy (India) Limited
6. IN Entertainment (India) Limited
7. Hinduja Finance Limited.
8. Planet E- Shop Holdings India Limited
Notes :
A. Figures in brackets are in respect of the previous year.
B. Includes other long term benefits amounting to RS.29.05 lakh (Previous year RS.13.13 lakh)
C. Includes RS.33.70 lakh (Previous year: RS.39.51 lakh) under unamortised borrowing cost .
D. Non Cash Transaction : During the previous year, the HITS business undertaking of Grant Investrade Limited (GIL) a 100% subsidiary of the Company was de-merged into IndusInd Media Communications Limited (IMCL) another subsidiary of the Company under a Scheme of Arrangement approved by the National Company Law Tribunal, with 1st October 2016 being the Appointed Date. In line with the terms of the Scheme, IMCL alloted equity shares as consideration to the Company. IMCL has alloted 338 shares of face value of RS.10 each for every 100 shares held by Hinduja Ventures Limited in Grant Investrade Limited. IMCL thereby allotted 22,948,239 Equity Shares to Hinduja Ventures Limited.
E. Including shares held jointly with Hinduja Realty Ventures Limited
5 Disclosure in accordance with Accounting Standard 15 ‘Employee Benefits’
The Company has classified various benefits provided to employees as under:
I Defined Contribution Plans
a) Provident fund
b) State defined contribution plans
i) Employer’s contribution to employees’ state insurance
ii) Employer’s contribution to Employees’ Pension Scheme, 1995
During the year, the Company has recognised the following amounts in the Statement of Profit and Loss:
* Included in contribution to employees provident and other funds - Refer Note No.23 of the Financial statements.
II Defined Benefit Plan
Gratuity
In accordance with Accounting Standard 15 (Revised 2005), actuarial valuation was carried out in respect of the aforesaid defined benefit plan of gratuity based on the following assumptions:
The liability for leave encashment and compensated absences as at 31st March, 2018 aggregates RS.22.60 (in lakh) [Previous Year - RS.12.88 (in lakh)].
1) The estimates of future salary increases considered in actuarial valuation, take account of Inflation, seniority, promotion, and other relevant factor, such as supply and demand in the employment market
2) The discount rate is based on the prevailing market yields of Government of India securities as at the Balance sheet date for the estimated term of the obligation.
3) As the defined benefit plan is unfunded, disclosure regarding plan assets is not applicable.
6 The details of derivative instruments and foreign currency exposures are as under:
(i) The year-end foreign currency exposures that have not been hedged by a derivative instrument or otherwise are as given below:
Amounts payable in foreign currency on account of the following:
(ii) All derivate instruments acquired by the company are for hedging purpose only.
(iii) Outstanding foreign exchange contracts entered into by the Company as on March 31, 2018 are
- Loans and advances, in the nature of loans to subsidiaries as shown above are repayable on demand.
- There are no other loans and advances in the nature of loans where there is no repayment schedule.
- Loans and advances to employees and investment by such employees in the shares of the Company, if any, are excluded from the above disclosure.
Note
1. TL -1 to TL 7 and STL-1 to STL-3 are secured against pledge of shares in IndusInd Bank Limited.
2. TL-8- The Loan is repayable in 7 years in 28 quarterly instalments, for each tranche of disbursement. First repayment will commence from 4th month of the date of each tranche of disbursement. Interest rate 6 months MCLR and Yes Bank Limited shall reset the 6 months MCLR on 1st day of the month falling after six calendar months including the month in which drawdown has been made.
First Charge on all current and movable assets (both present and future) and Escrow Account for collection of proceeds of lease rentals to be created in favour of Vistra ITCL India Ltd.
7. As a part of its real estate activity, the Company had acquired approximately 47 acres of land in Devanahalli Bengaluru from a party in terms of Agreement of Sale Deed dated 28.07.1995. However, as the said party, though in receipt of sale consideration did not fulfill its legal obligation to transfer the title in the name of the Company, the Company filed a suit for specific performance in the Civil Court in 2011. An order granting temporary injunction was passed on 11.03.2013 restraining the said party from alienating or in any way encumbering the land in Devanahalli. A criminal complaint was also filed at the Devanahalli Court on 10.11.2014 and the investigation was stayed by the Hon’ble High Court of Karnataka vide order dated 15.12.2015 which lapsed in the month of August, 2016. The sub-inspector of Police Devanahalli filed charge sheet on 29.11.2016 and an order for arrest of the aforesaid party was made on 09.02.2017 and party was arrested on 15.02.2017 and produced before the Magistrate Court on 17.02.2017 and was released on bail. On 18.04.2017, the Hon’ble High Court asked to explore the possibilities of a settlement and no interim order of stay was granted. The suit for Specific Performance in the Civil Court, the Criminal Compliant at Devanahalli Court are pending. The Department of Revenue, Government of Karnataka, has also raised certain issues relating to the title of the land which are being addressed by the Company.
8. The Company had obtained registration as a sub-broker of the National Stock Exchange of India Limited and Bombay Stock Exchange Limited from Securities and Exchange Board of India. The Company is engaged in the activity of sub-broking during the year. In the opinion of the Management and based on a legal opinion, the Company is not required to register as a non-banking financial Company with Reserve Bank of India.
9. The Company, based on independent legal opinion, is of the view that the Indian Accounting Standards (IND AS) as specified in the Companies (Indian Accounting Standards) Rules, 2015, as amended, are not applicable to the Company for this year, and will be applicable from the financial year commencing from April 1, 2018, in view of the Notification No.G.S.R. 365 (E) dated 30th March 2016 issued by the Ministry of Corporate Affairs. Accordingly, the standalone financial statements for the year ended March 31, 2018 have been prepared in accordance with the Accounting Standards prescribed under section 133 of the Companies Act, 2013 read with the Companies (Accounting Standards) Rules 2006, as amended.
10. Details of loans given during the year in the form of Inter Corporate Deposits and the purpose for which the loan is proposed to be utilised by the recipient of the loan as required under Section 186 (4) of the Companies Act, 2013 are as under:
11 The Company has not received any responses from its “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006, accordingly the disclosures relating to amount unpaid as at the end of the year together with interest paid/payable as required under the said Act and provision for interest on delayed payments, if any, is not ascertainable at this stage.
12 Corporate Social Responsibility
a) Gross amount required to be spent by the Company during the year for Corporate Social Responsibility (CSR) :- RS.100.00 lakh [Previous Year - RS.60.00 lakh)
b) Following are the details of amount spent during the year for CSR :-
Note - Figures in brackets are in relation to previous year
13 Accounting for Amalgamation
a) The standalone financial statements of the Company for the year ended March 31, 2018 which were earlier approved by the Board of Directors of the Company in their meeting held on May 7, 2018 were subject to revision by the Company so as to give effect to the Scheme of Amalgamation between Grant Investrade Limited (GIL), a wholly owned subsidiary of the Company with the Company (the Scheme).
b) Pursuant to the above Scheme, the undertaking and the entire business, including all assets and liabilities of GIL stand transferred to and vest in the Company. GIL was engaged in the business of running movie channels on cable TV, business activities relating to optic fibre and treasury business.
c) The Scheme has been approved by the National Company Law Tribunal (NCLT) on May 10, 2018 and the necessary filings have been done with the Registrar of Companies on July 2, 2018. Consequently, these revised financial statements have been prepared by the Company and the Scheme has been given effect to in the books with effect from October 1, 2017, being the appointed date as per the Scheme approved by the NCLT.
d) Combination of authorised capital:
Pursuant to the aforesaid amalgamation and in terms of the said approved Scheme, the authorised share capital of the Company stands increased by the authorised share capital of the Transferor Company aggregating RS.1,000.00 lakh.
Accordingly, effective October 1, 2017, the authorised capital of the Company stands at RS.9,001.00 lakh.
e) Accounting treatment
The Company has followed the accounting treatment prescribed in the said approved Scheme of Amalgamation, as follows:
i. The amalgamation of GIL with the Company has been accounted by the Company in the books by using the pooling of interest method in accordance with the said approved Scheme of Amalgamation and Accounting Standard (AS) 14 as notified under the Companies Act, 2013.
ii. The Company has recorded all the assets and liabilities, and reserves of GIL at their respective book values as appearing in the books of GIL as at September 30, 2017, as shown hereunder and difference between the share capital including securities premium account of the transferor Company and the investment in the transferor Company recorded in the books of the Company amounting to RS.734.35 lakh has been transferred to Capital Reserve account.
iii. Consequent to the aforesaid amalgamation, figures in respect of previous year are not comparable.
14 The Board of Directors have recommended a dividend of RS.17.50 per share (on par value of RS.10/- each per equity share) for the year ended March 31, 2018, to be approved by the Shareholders in the ensuing Annual General Meeting of the Company.
15 Previous Year’s figures have been regrouped / reclassified wherever necessary to correspond with the current year’s classification / disclosure.
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