| 1. The Company has de-recognized deferred tax asset (DTA) of Rs. 5284
Lacs as the earnings of the Company are expected to stabilize after
debt restructuring is implemented by all the lenders in its entirety,
and that during such pendency the Company following Accounting Standard
22, is unable to estimate with certainty its ability to absorb the
amount of losses against future taxable income and the tax savings are
therefore, not quantifiable.
2. Suvidha Cooling Towers Pvt. Ltd. filed a civil suit in Karkardooma
Court, Delhi for recovery of Rs. 8.00 Lacs including interest. . Since,
the claim of the supplier is disputed by the Company, based on the legal
advice in the matter, the Company does not consider it necessary to
make any provision to this affect in its books of account.
3. Certain transactions between Standard Chartered Bank and the
Company, considered void ab initio by the Company, are subject matter
of suit filed by the Company against the said Bank before the Hon'ble
Bombay High Court. The Company has claimed the refund of the amount of
Rs. 3,666.38 lacs, including amounts paid to the said Bank along with
cost, charges and interest incurred by the Company thereon as
quantified in the said suit, and a declaration to the effect that no
further payments are required to be made to the said Bank. In line with
the claim filed by the Company, the latter has reversed the amount of
payment due to Standard Chartered Bank in the books of account. The
Hon'ble Bombay High Court has issued notice to parties in the matter of
above suit, and subsequently the said Bank has filed an Original
Application before the Hon'ble Debt Recovery Tribunal-II, Delhi for
recovery of its claim amounting to Rs. 2,216.37 lacs.
4. The Company had taken a Short Term Revolving Loan from SICOM Ltd.
against amounts accrued on account of Company's entitlement to receive
interest subsidy under Technology Upgradation Fund (TUF's as available
to Textile industry) and against export incentive pending release by
the appropriate authorities. The Company had given a Power of Attorney
to SICOM Ltd. to recover the amount directly from the concerned
agencies, and therefore, and in this manner the borrowings from SICOM
Ltd. would stand completely repaid.
SICOM Ltd. had filed a petition for winding-up of the Company before
the Hon'ble High Court of Delhi for recovery of loan amount, and by way
of interim orders dated 24.04.2014, the Hon'ble High Court of Delhi
restrained the Company from selling, transferring, encumbering or in
any manner alienating any of its immovable assets and also from selling
of movable assets except in the normal course of business.
SICOM Ltd. filed a complaint u/s 138 R/w section 141 of the Negotiable
Instrument Act, 1881 in the Court of Metropolitan Magistrate, Patiala
House Court, Delhi, in respect of dishonor of 3 nos. cheques
aggregating to Rs. 1500 lacs, being part of the amount of claim of
SICOM referred above. The aforesaid cheques had been given by the
Company to SICOM Ltd. as security and were not expected to be presented
for encashment.
SICOM Ltd. filed an Original Application (O.A.) before Hon'ble Debt
Recovery Tribunal-I, Delhi for recovery of its claim amounting to Rs.
1575.35 lacs in respect of Short Term Revolving Loan against export
incentive receivable by the Company. The Hon'ble DRT vide its order
dated 20.12.2013 has directed that in future all amounts recoverable by
the Company be received and deposited in an escrow account in the name
of the Company established with HDFC Bank and also by way of its
interim order dated 27.02.2014 restrained the Company from dealing in
any manner in respect of certain properties belonging to the Company as
specified in the order.
5. UCO Bank filed a complaint u/s 138 R/w section 141 of the
Negotiable Instrument Act, 1881 in the Court of Metropolitan
Magistrate, Dwarka Court, Delhi, in respect of dishonor of a cheque of
Rs. 300 lacs issued by the Company for payment of its liability towards
letter of credit availed by the Company over and above the sanctioned
limit. Part of the aforesaid outstanding towards UCO Bank has since
been paid and the balance amount has been restructured as part of
restructuring carried out by the CDR Forum, and has accordingly, been
accounted for in the books of account of the Company and reflected in
financial statements.
6. Notice from Tehsildar, Noida, UP, received by the Company against
an outstanding amount on account of electricity dues relating to
electric connection at property B-8,9,10 phase-II, Noida, UP, owned by
the Company. The aforesaid amount was not informed to the knowledge of
the Company at the time that the Company purchased this property. The
Company is taking appropriate legal steps against the said recovery.
For reasons that the recovery amount is disputed by the Company, no
provision is considered necessary to be made in the books of account.
7. Certain transactions between Hongkong & Shanghai Banking Corp. and
the Company, considered void ab initio by the Company, are subject
matter of suit filed by the Company against the said Bank before the
Hon'ble Bombay High Court. The Company has claimed the refund of the
amount of Rs. 1022.45 lacs, including amounts paid to the said Bank
along with cost, charges and interest incurred by the Company thereon
as quantified in the above suit, and has sought a declaration from the
Hon'ble Court to the effect that no further payments are required to be
made to the said Bank.
8. The Citi Bank NA has claimed Rs. 196.32 lacs against the forex
transaction which are considered void ab initio by the Company. Since,
the claim by the bank is disputed; the Company has not made any
provision in respect thereof in its books of account.
9. A Deed of guarantee executed by the Company in favour of Tata
Capital Financial Services Ltd. against loan taken by an Associate of
the Company did not take effect as the application of the Company made
to the Central Government for grant of approval under the Companies
Act, 1956 could not be processed as the provisions of Companies Act,
2013 were notified.
10. Segment Information
The Company is principally engaged in the business of Toys and Home
Furnishings. Accordingly there are two reportable segments as per
Accounting Standard (AS 17) issued by the Institute of Chartered
Accountant of India on 'Segment Reporting', which have been disclosed
below.
The Company's operating facilities are located in India
11. Related Party Transactions
As per AS-18, the Company's related parties and transactions with them
are disclosed below
12. There are no amounts due and outstanding to be credited to Investor
Education and Protection Fund as at March 31, 2015.
13. Debtors, Loans & Advances and Creditors in some cases are subject to
reconciliation and confirmation.
14. Comparative figures for the previous year have been regrouped,
recast and re-arranged wherever necessary.
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