| 1. Rights, Preferances and Restrictions attached to Shares Issued :
Each Equity Shareholder holding shares of Rs. 10/- each is eligible for
one vote per share held and is entitled to dividend when proposed by
the Board of Directors subject to the approval of the sharesholders in
the Annual General Meeting. Each Equity Shares holders is entitled to
participate in repayament of Capital on liqudation after all secured
creditors have been paid.
13% Non Convertible Cumulative Redeemable Preference Shares have
already matured for redemption completely by 12th December, 2002 as per
terms of redemtion. However, no part of this Share Capital amount could
be redeemed by the aforesaid date. The Company has received during the
year 2010-11 a letter from IDBI, The holders demanding forthwith the
payament of the entire amount due on redemption togathet with the
dividends due thereon.
However, the matter is pending restructuring of loans due to banks and
financial institutions.
* The company, being a sick industrial undertaking could not redeem
debentures & interest thereof as per the terms of issue, which will be
dealt properly in the restructuring scheme. Accordingly no transfer has
been made to the Account of Investor & Protection fund.
* Following the declaration of the Company as a Sick Industrial
undertaking by the Board for Industrial and Financial Reconstruction
(BIFR) vides its Order dated 30.01.2006 in terms of Section 3 (1) (A)
of the Sick Industrial Companies (Special Provisions) Act, 1985 and
also athe appointment of Industrial Development Bank of India as the
Operating Agency for preparation of a viability study report to revive
the Company, Appeals against the said order were preferred by some of
the secured lenders as well as the Company before the
AppellateAuthority for Industrial & Financial Reconstruction (AAIFR).
The said appeals were taken up and adjudicated and vide its order dated
05.12.2007, AAIFR has remanded the case back to BIFR with a direction
to reconsider the earlier references of the company on the basis of its
earlier Balance Sheets also. During the year 2010-11 in one of the
appeals pending before AAIFR and in pursuance of ARCIL's application .
AAIFR has opined that in veiw of the actions taken by ARCIL under
Section 13 (4) of SARFAESI Act, the reference filed by the Company
stood abated in one of the appeals pending before AAIFR under the
proviso to Section 15(1) of SICA.
Following the reference application filed by the company having stood
abated under the proviso to Section 15(1) of SICA. ARCIL has asked
Indoworth to handover to them the possession of assets of the company
covered by the security.
However, matter is subjudice in a suit before the Kolkata High Court
and necesssary adjustments would be made in the financial statements if
required consequent to the final outcome of the proceedings. Pending
the above, the financial statements have been drawn up on Going Concern
basis as the Management is of the view that the going concern
assumption is not vitiated for the reason as stated above.
* Under the provisions of Securitisation and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002
(SARFAESI Act), ARCIL has taken over possession of the secured assets
of the Company's plants during the Financial Year 2008-09 and has
appointed Indoworth India Ltd as the Custodian of such assets.
The Company's business continued since the aforesaid take over as
usual. However, the matter is subjudice in a suit before the Calcutta
High Court and necessary adjustments in the financial statements, if
required, would be made upon final adjudication of the proceedings.
However, these Accounts have been prepared on a Going Concern basis as
the Management is of the view that the Going Concern assumption is not
vitiated for the reason as stated above.
* The outstanding balance of Term Loans from Financial Institutions
and some of the banks are subject to receipt of confirmation /
statements, which couldnot be avialable due to restructuring in
progress.
* Mode of valuation - Refer Accounting Policy Note-1(f)
2. Finished Goods
i) Value of ' 184.38 Lacs lying with thrid party.
ii) Value of ' 115.51 Lacs under seizer of the Excise Department for a
storage of Stock with a third party without obtaining permission of the
Excise Department.
* Trade Recievable includes Rs. 2041.21 Lacs due from a Company which
has become sick and registered with BIFR under the Sick Industrial
Companies (Special Provisions) Act, 1985. Quantum of amount considered
doubtful is not ascertainable at this Stage. Accordingly no provision
has been made in the account in this regards.
* In respect of Sundry Debtors (including Domestic sales Debtors)
adjustments are pending against supplies and other liabilities, etc due
to the buyers Managent is confident of recovering the balance after
such adjustments pending approval from concerned regulatory authority.
* Certain Debtors are subject to Confirmation.
* Trade Recievable includes :
i) Rs. 3697.89 Lacs representing overdue Export Bills outstanding for
long against which the acompany has obtained a decree for realizing the
outstanding debts over a period of time ranging up to twenty years.
The company has also filed an appeal for reduction/variation of the
period of time.
ii) Rs. 27097.12 lacs representing overdue Export Bills outstanding for
long that will be set off against import liabilities, claims, and
commission etc. of the respective parties.
iii) Rs. 992.30 lacs representing overdue Export Bills outstanding for
long against which the management has taken appropriate steps for its
recovery.
iv) Rs. 131.62 Lacs represanting other trade recievables outstanding
for long against which the management has taken appropriate steps for
recovery. According no provision gas been considered necessary at this
stage.
* Balances with the Bank in Current Account include Debit balances in
Current Account of Rs. 79.14 Lacs which are subject to receipt of
confirmation because of restructuring being in progress.
* Fixed Deposit lodged with Bank as margin for Guarantee Rs. 4.07 Lacs
and with Sales Tax Authorities Rs. 0.39
* During the year one of the banker of the company, Axis Bank Ltd,
under instructions from ARCIL has made debit freeze (freezing all
withdrawals ) of all current account of the company maintained with
them, the balance of which as per books amounted to Rs. 65.23 lacs as
on 31st March, 2015.As per Confirmation Certificates obtained from the
Bank, total balance of all such Current Accounts works out to Rs. 4.26
lacs as on 31st March, 2015. in absence of any details of the
withdrawals/other transactions made from such Accounts, necessary
entries could not be made in the books of the company.
* During the year the company opened certain new Current Accounts with
Banks (other than the bankers of the Company).
* Claim receivable of Rs. 689.36 lacs due from various banks on
account of excess interest charged by them in earlier years are subject
to confirmation. No provision has been made there against.
* Short Term Loans and Advances includes Rs. 1327.09 Lacs which have
become sick and referred to BIFR under the Sick Industrial Companies
(Special Provisions) Act, 1985. Quantum of amount considered doubtful
is not ascertainable at this Stage. Accordingly no provision has been
made in the account in this regards.
* Advance includes Rs. 3144.73 Lacs due from a party which in opinion
of the Management is considered t be fully recoverable.
* Advance includes Rs. 0.10 Lacs due from a director (Max Amount at
any time during the year Rs. 1.08 Lacs)
* Certain Advances are subject to Confirmation.
* The adjustment of Rs. 5948.37 lacs pertaining to transfer of Fixed
Assets of the company in earlier years under scheme of demerger is
still pending and will be dealt in restructuring Scheme.
2. Contingent Liabilities and Commitments :
(To the extent not provided for)
i) Contingent Liabilities
a) Claim against the company not acknowledged as debt.
b) Guarantees 767,629 767,742
c) Other money for which
the company is
contingently liable :
* Letter of Credit 9,882 9,882
* Arrear Dividend on
13% Non Convertible
Cumulative
Redeemable Preference
Shares.
(Refer Note 2 (b)) 38,224 38,224
* Entry Tax 8,858 8,858
* Central / Commercial
Sale Tax Demands 20,463 20,463
* Excise Demands 104,329 127,129
* Interest on Lease rent 473
* TDS Demand Default 923
* Custom Demands 46,922 25,200
* Professional Tax/Labour
Cases/Water Cess etc. 985 981
* Electricity Duty 11,545 242,604 115,450 346,187
Total 1,010,233 1,113,929
* Claims / Disputed liabilities not acknowledged as debt,the amount of
which is not ascertained.
* Gaurantees include Corporate Guarantees Rs. 7000 lacs ( Previous
Year Rs. 7000 lacs) given by the Company to financial Institutions and
Banks for granting Term Loans and Working Capital Loans to certain Body
Corporates.
* Interest provision on borrowing from some of the institutions and
banks has been made in the accounts at prevailing/estimated rates on
simple interest basis applicable on such loans. The impact of compound
interest /Penal charges wherever applicable could not be ascertained.
Besides there is dispute between the Company and Bankers/Creditors,
over the issue of charging interest and payment to the
Bankers/Creditors of interest and principal amount.The
Bankers/Creditors have approached appropiate court of law for recovery
of its due which is being defended by the Company.
* Pending restructuring interest provision on certain
loans/borrowings has not been made and impact of the same is not
presently ascertainable
3. Related Party disclosure as required by AS - 18, "Related Party
Disclosure" are given below : a) Relationship :
Associates
Uniworth Textile Ltd.
Uniworth Power Ltd.
Uniworth Apparel Ltd.
Aviante International Ltd.
Key Management Personnel Mr S N Shenwai
a) Balance of ' 4250.51 lacs with Uniworth Textiles Limited (Related
Party) as at 31st March, 2015 is under reconciliation.
4. Based on the guiding principles given in Accounting Standards on
"Segment Reporting" (AS-17) the Company's primary business segment is
Wool and Silk business.
5. Employee benefits (Revised Accounting Standard 15)
a) Defined Contribution Plan :
The company makes contribution towards Provident Fund and ESIC to a
defined contribution retirement benefit plan for qualifying employees.
The Provident Fund plan is operated partly by RegionalProvident Fund
Commissioners and partly by an independent Trust, ESIC by Government
agencies. Under the said schemes the company is required to contribute
a specific percentage of pay roll costs in respect of eligible
employees to the retirement benefit scheme to fund the benefits.
During the year the company has recognised Rs. 64.05 lacs for Provident
fund contribution, Rs 18.98 lacs for ESIC. The Contribution payable to
these plans by the Company is at the rates specified in the rules of
the scheme.
b) Defined Benefit Plans :
i) The plan provides for a lump sum payment to vested employees upon
retirement, death while in employment or on termination of employment
of an amount equivalent to 15 days basic salary payable for each
completed year of service. Vesting occurs upon completion of five years
of continuous service.
ii) The employees of the company are eligible for encashment of leave
upon retirement up to 30 days for each year (Maximum 120 days). Leave
is accounted for on accrual basis.
6. With the introduction of the companies Act, 2013 with effect from
1st Arpil, 2014, adoption of Schedule - II of the said Act regarding
calculation of depreciation based on estimated Useful Life of each
tangible asset has become mandatory from that date. However, as the
company's Fixed Assets Register has not yet been fully updated with
regard to estimated useful life of each asset, calculation of
depreciation as per schedule -II could not be made by Company during
the year. This tantamount to non- compliance of mandatory requirements
of the Companies Act, 2013 read with Accounting Standard (AS) 6:
Depreciation Accounting. Effect of such non-compliance on the Financial
Statements of the Company is not presently ascertainable.
7. The Company has not recognized Deferred Tax Assets (Net) as per
Accounting Standard - 22, regarding "Accounting for Taxation"
estimation of future in view of consistent losses and of uncertainty
regarding Profit with reasonable certainty.
8. Certain Banks and Financial Institutions have taken legal recourse
for recovery of their dues from the company. Loans and Advances
includes Rs. 150 lacs deposited with the Banks in the name of advocates
on record for both parties as per order of Hon'ble Kolkata High Court
in case of litigation with the Bank.
9. Due to non-completion of certain technical formalities, certain
borrowing facilities,which were to be transferred to a body corporate
pursuant to the original scheme of restructuring, could not be made.
10. The company has applied from time to time to The Reserve Bank of
India for extension/ set off of certain over- due bills, approval of
which is still awaited.
11. In preparation of these Accounts, cognizance has not been taken by
the Company of a Debit Note sent by a body corporate in an earlier year
, indicating the unilateral transfer back by the said body corporate of
all the assets which were transferred to them on 01.04.2000, together
with all existing and underlying securities/ charges as part of the
restructuring scheme formulated by ICICI, in view of the various
judicial proceedings pending at this juncture. However, the Company has
been legally advised to deal with the above transfer back only after
final disposal of the process of adjudication by the Court.
12. Export obligation for the assets acquired/taken on lease without
payment of applicable duties lies with the Company under the provisions
of the Exim Policy (Amount unascertained).
37. Discounts, commission & other selling expenses include commission
Rs 235.91 lacs. (Pr. year Rs 133.81 Lacs).
13. Claims had been filed against the Compamy by a body corporate
amounting to Rs. 21625 Lacs for non fulfillment of certain clauses of
an agreement relating to transfer of Nagpur Unit to them in respect
this we are unable to express our opinion on liablities that may arise
eventualy on finalistion of suit.
14. The previous year's figures have been reworked, regrouped,
rearranged and reclassified wherever necessary and practicable .
Amounts and other disclosures for the preceding year are included as an
integral part of the current year financial statements and are to be
read in relation to the amounts and other disclosures relating to the
current year.
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