f) Rights and preferences attached to the equity shares
i. The Company has only one class of equity share having par value of '10 per share. Each holder of equity share is entitled to one vote per share.
ii. In the event of winding up the equity shareholders will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportionate to the number of equity shares held by the shareholders.
iii. The Dividend proposed by the Board of Directors is subject to the approval of share holders in the ensuing Annual General Meeting except in the case of interim dividend.
1. Term Loan from Bank ' 1118.06 lacs taken from Bank under Emergency Credit Line Guarantee Scheme (ECLGS) secured by second pari passu charges on current assets and immovable assets (Collateral 100% Credit gurantee by National Credit Gurantee Trustee Company Ltd (NCGTC)). Repayable in 35 equal monthly installments.
# Working Capital borrowings are secured by hypothecation of entire current assets viz stocks and book debts etc., both present and future, of the Company and by a second charge on entire fixed assets of the Company including land at Ranpur, Kota, (Rajasthan) and excluding certain specified Fixed assets.
The periodical returns/ statement filed by the Company with respect to working capital taken from banks on the basis of security of current assets, are in agreement with books of accounts.
Note No. 33
Contingent liabilities, not provided for in respect of :
(i) Claims by certain parties against the company not accepted and not provided for ' 652.82 lacs (Previous Year ' 687.46 lacs).
(ii) Income Tax (matters in appeals) of ' 342.60 lacs (Previous year ' 342.60 lacs ).
(iii) Guarantees issued by bank on behalf of the Company as on March 31,2024 is ' 4.00 lacs (Previous year ' 2.00 lacs)
Note No. 34
Company acted as a facilitator for Schedule Banks '5974.65 lacs (Previous year ' 4903.71 lacs) for loans provided to the farmers, grouped under trade payables / trade advances.
Note No. 35
Estimated amount of contracts net of advances amounting to ' NIL (Previous year ' 4.00 lacs) remaing to be executed on capital account.
Note No. 36
Expenditure on Research and Development (R&D) activities during the year:
Note No. 38
Income tax calculation has been made considering certain expenses/adjustments available as assessed by the management.
Note No. 39
Based on information available with the Company in respect of MSME (‘The Micro Small & Medium Enterprises Development Act 2006’). The details are as under:
i) Principal and Interest amount due and remaining unpaid as at 31st March 2024 ' Nil (previous year ' Nil).
ii) Interest paid in terms of section 16 of the MSME Act during the year - Nil (previous year - Nil).
iii) The amount of Interest due and payable for the period of delay in making payment (which have been paid but beyond the appointed day during the year) but without adding the interest specified - Nil (previous year - Nil).
iv) Payment made beyond the appointed day during the year - Nil (previous year - Nil).
v) Interest Accrued and unpaid as at 31st March 2024 - Nil (previous year - Nil).
Note No. 40
Foreign Currency exposure not hedged as at Balance sheet Date:
Net receivable ' Nil - US$ Nil (Previous year ' 80.44 Lacs - US$ 97872.86), Net payable ' Nil (US$ Nil) (Previous year ' 94.37 lacs (Euro 105920) ) and Buyers Credit ' Nil (Previous year Nil)
Note No. 41
Retirement benefit obligations:
A Expenses Recognised for Defined Contribution Plan
Note No. 42 Segment Information:
The Company is engaged primarily into Agri & Allied products. The Company has only one business segment as identified by management namely “Agri & Allied products”. Segments have been identified taking into account nature of product and differential risk and returns of the segment.
Note No. 45 Lease
The Company has adopted Ind AS 116 “Leases” effective 1st April 2019 as notified by the Ministry of Corporate Affairs (MCA) and applied the Standard to using the simplified approch. This has resulted in recognising right-of-use assets and corresponding lease liabilities.
Note No. 47
Financial Risk Management Objectives and Policies.
The Company’s Financial Risk Management is an integral part of how to plan and execute its Business Strategies. The Company’s Financial Risk Management Policy is set by the Board. The Company’s activities are exposed to a variety of financial risks from its operations. The key financial risks include market risk (including foreign currency risk, interest rate risk and commodity risk etc.), credit risk and liquidity risk.
47.1 Market Risk: Market risk is the risk of loss of future earnings, fair values or future cash flows that may results from change in the price of a financial instrument. The value of a financial instrument may change as result of change in the interest rates, foreign currency exchange rates, equity prices and other market changes may affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments and deposits, foreign currency receivables, payables and loans and borrowings. Market risk comprises mainly three types of risk:
Interest rate risk, currency risk and other price risk such as equity price risk and commodity risk.
The Company has an elaborate risk management system to inform Board Members about risk management and minimization procedures.
a) Foreign Currency Risk :
Foreign Currency risk is the risk that the fair value or future cash flows of an exposure will fluctuate because of changes in foreign exchange rates. The Company makes certain imports and exports in foreign currency & therefore is exposed to Foreign Exchange Risk. The Company evaluates exchange rate exposure arising from foreign currency transactions. The Company has undertaken hedging activities for foreign exchange.
b) Interest Rate Risk :-
Interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Any changes in the interest rates environment may impact future rates of borrowing. The Company mitigates this risk by maintaining a proper blend of Fixed & Floating Rate Borrowings. The following Table shows the blend of Company’s Fixed & Floating Rate Borrowings in Indian Rupee:
The assumed movement in basis points for the interest rate sensitivity analysis is based on the currently observable market environment.
(c) Commodity Price Risk and Sensitivity:
Commodity price fluctuations can have an impact on the demand of seeds for particular crop. Therefore, we track the commodity price movements very closely and take advance production decisions accordingly.
In addition to the above, Company also maintains a strategic buffer inventory to ensure that such disruptions do not impact the business significantly.
47.2 Credit Risk:
Credit risk is the risk that counterparty might not honor its obligations under a financial instrument or customer contract, leading to a financial loss. The company is exposed to credit risk from its operating activities (primarily trade receivables).
47.2a Trade Receivables: Customer credit risk is managed based on company’s established policy, procedures and controls. The company assesses the credit quality of the counterparties, taking into account their financial position, past experience and other factors.
Credit risk is reduced by receiving pre-payments and export letter of credit to the extent possible. The Company has a well defined sales policy to minimize its risk of credit defaults. Outstanding customer receivables are regularly monitored and assessed. Impairment analysis is performed based on historical data at each reporting date on an individual basis. However a large number of minor receivables are grouped into homogenous groups and assessed for impairment collectively.
47.2b. Advance to suppliers are net of provision/loss allowances made for Doubtful advances of ' 39.91 lacs (Previous year ' 34.12 lacs).
47.2c. ECL impairment loss allowance (or reversal) recognized during the period as income/ expense in the Statement of Profit and Loss under the head ‘Other expenses’. The balance sheet presentation for financial instruments is described below:
i) Financial assets measured as at amortised cost: ECL is presented as an allowance, i.e., as an integral part
of the measurement of those assets in the balance sheet. The allowance reduces the net carrying amount. Until the asset meets write-off criteria, the company does not reduce impairment allowance from the gross carrying amount.
ii) Financial Assets includes ' 1823.61 lacs towards Trade Receivables and Security Deposit of ' 121.68 lacs shown under the heading “Deposit with Government Authorities and others” from Rajasthan State Seed Corporation (RSSC). The company has filed claim before the arbitral tribunal against RSSC which was not allowed on technical grounds of limitation without examining the matter on merits. The company has filed an application under sec 34 of the Arbitration and Conciliation Act 1996 challenging the said order of the arbitral tribunal before the commercial court Jaipur. During the year RSSC filed Special Leave Petition (SLP) in the Hon’ble Supreme Court against the orders of High Court of Rajasthan in miscellaneous application which was dismissed in our favour. Based on the legal opinion, the company has good case for realisation of the recovery of above amount.
iii) The Company has initiated legal proceedings against Uttar Pradesh Seed Development Corporation (UPSDC) and the Department Of Agriculture, Government of UP for recovery of the overdue outstanding of ' 952.00 lacs out of which ' 203.79 lacs was received during previous years. The current outstanding is ' 748.21 lacs (Previous year ' 782.21 lacs) for which necessary provision were made under expected credit loss allowance in the books of accounts.
The Company has filed an application under the Arbitration and Conciliation Act 1996 for appointment of Arbitrator for recovery of the aforesaid overdue amount from UPSDC. Hon’ble High court did not allow the application and held that the dispute is not covered by the arbitration. As such the Company had filed a separate writ petition in 2019 before the Hon’ble High court Lucknow against Uttar Pradesh Seed Development Corporation (UPSDC) and the Department Of Agriculture, Government of UP for recovery of the overdue outstanding of ' 952 lacs lacs basing on the facts of the case and other circumstances took place after filing the writ petition, the company has good chance of recovery.
An amount of ' 54.87 Lacs, since been received during the month of April 2024 .
47.2d. Some of the balances of debtors, loans & advances and current liabilities are in the process of confirmation/ reconciliation.
47.3 Liquidity Risk:
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Company’s approach is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when due. when both normal and stressed conditions, without incurring unacceptable losses or risking damages to the company’s reputation.
Maturity Profile of Financial Liabilities:
The following Table provides undiscounted cash flows towards financial liabilities into relevant maturity based on the remaining period at the balance sheet to the contractual maturity date.
Note No. 48
Capital Risk Management:
The Company manages its capital structure and makes adjustments in light of changes in economic conditions and the requirements of the financial covenants. The Company’s primary objective when managing capital is to ensure that it maintains an efficient capital structure and healthy capital ratios and safeguard the Company’s ability to continue as a going concern in order to support its business and provide maximum returns for shareholders. The Company also proposes to maintain an optimal structure to reduce the cost of capital. For the purpose of the Company’s capital management, capital includes issued capital, securities premium and all other equity reserves. Net debt includes, interest bearing loans and borrowings, less cash and cash equivalents.
Fair Valuation Techniques:
The Company maintains policies and procedures to value Financial Assets & Financial Liabilities using the best and most relevant data available. The Fair Values of the Financial Assets and Liabilities are included at the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
The Company has disclosed financial instruments such as cash and cash equivalents, other bank balances, trade receivables, trade payables and other financial liability at carrying value because their carrying amounts are a reasonable approximation of the fair values due to their short term nature.
Fair value of Investments in quoted mutual funds are based on quoted market price at the reporting date.
The Company does not have any asset or liabilities that can be grouped into Level 1 to Level 3 for Fair value measurement
Note No. 53
Impairment Testing of Intangible Assets
The Brands are considered to have an Indefinite useful life on the basis of the expected longevity and tested for impairment annually, in case there is any indication for impairment of carrying value. Based on internal analysis and relevant factors, the Management is of the opinion that, the brand is expected to continue to generate cash flows for an undetermined period.
Note No. 55
Following are the additional disclosures required as per Schedule III to the Companies Act, 2013 vide
Notification dated March 24, 2021:
a. There are no proceedings which have been initiated or pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 and rules made thereunder.
b. The Company has not been declared as Willful Defaulter by any Bank or Financial Institution or other Lender
c. During the year, the Company does not have any transactions with the companies struck off under section 248 of Companies Act, 2013 or section 560 of Companies Act, 1956.
d. The Company has complied with the number of layers prescribed under clause (87) of section 2 of the Act read with Companies (Restriction on number of Layers) Rules, 2017.
e. During the financial year ended March 31,2024, other than the transactions undertaken in the normal course of business and in accordance with extant regulatory guidelines as applicable.
(i) No funds (which are material either individually or in the aggregate) have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Company to or in any other person or entity, including foreign entity (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Company (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
(ii) No funds (which are material either individually or in the aggregate) have been received by the Company from any person or entity, including foreign entity (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, that the Company shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (“Ultimate Beneficiaries”) or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries.
f. The Company does not have any transactions not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961). Also, there are nil previously unrecorded income and related assets.
g. No scheme of arrangement has been approved by the competent authority in terms of Section 230 to 237 of the Companies Act, 2013 during the year ended March 31,2024.
h. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
i. The Company has not granted Loans or Advances in the nature of loan to any promoters, Directors, KMPs and the related parties (As per Companies Act, 2013), which are repayable on demand or without specifiying any terms or period of repayments.
Note No. 56
Previous year’s figures have been re-grouped/re-classified/recast wherever necessary.
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