(o) Provisions, Contingent Liabilities and Contingent Assets Provisions
A provision is recognized when an enterprise has a present obligation as a result of past event and it is probable that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to their present values and are determined based on management estimates of the obligation required to settle at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current management estimates.
Provision for warranties:
The estimated liability for product warranties is recognised when products are sold. These estimates are established using historical information based on the nature, frequency and average cost of warranty claims and management estimates regarding possible future incidence based on corrective actions on product failures. The timing of outflows will vary as and when warranty claim will arise. The company accounts for the provision for warranties on the basis of information available to the management duly taking into account the current and past technical estimates.
Contingent Liabilities:
Contingent liabilities are disclosed in respect of possible obligations that have arisen from past events
and the existence of which will be confirmed only by the occurrence or non-occurrence of future events not wholly within the control of the Company. When there is an obligation in respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.
Contingent assets:
Contingent assets are not disclosed in the financial statement unless an inflow of economic benefit is probable.
(p) Cash and Cash Equivalents
Cash and Cash Equivalents in the balance sheet comprise cash at banks, cash in hand, term deposits, and fixed deposits kept as security / margin money for more than 3 months but less than 12 months. For the purpose of the statement of cash flows, cash and cash equivalents consist of cash in hand, bank balances in current accounts and bank deposits, as defined above, as they are considered an integral part of the Company's cash management. The deposits maintained by the Company with banks comprise of deposits, which can be withdrawn by the Company at any point without prior notice or penalty on the principal.
(q) Government Grants and Production Linked Incentives
Government grants:
Government grants are recognised where there is reasonable assurance that the grant will be received and all attached conditions will be complied with. Where the grant relates to an asset the cost of the asset is shown at gross value and grant thereon is treated as capital grant. The capital grant will be recognised as income in the statement of profit and loss over the period and in proportion in which depreciation is charged. Revenue grants are recognised in the statement of profit and loss in the same period as the related cost, which they are intended to compensate are accounted for.
Production Linked Incentive:
Production Linked Incentives are recognised as income when, on the basis of the judgment of the management and based on the supporting data with respect to the eligibility conditions, the Company fulfils the eligibility conditions as per the approval letter. The management applies its judgement for the recognition of incentive income based
on the management's assessment for likelihood of recoverability.
(r) Impairment of Assets
The Management periodically assesses, using external and internal sources, whether there is an indication that an asset may be impaired. An impairment loss is recognized wherever the carrying value of an asset exceeds its recoverable amount. The recoverable amount is the higher of the asset's net selling price or value in use, which means the present value of future cash flows expected to arise from the continuing use of the asset and its eventual disposal. An impairment loss for an asset is reversed if, and only if, the reversal can be related objectively to an event occurring after the impairment loss was recognized. The carrying amount of an asset is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of any accumulated amortization or depreciation) had no impairment loss been recognized for the asset in prior years.
(s) Research and Development Expenditure
Research and development expenditure that do not meet the criteria for the recognition of intangible assets are recognised as an expense as incurred. Development costs previously recognised as an expense are not recognised as an asset in a subsequent period.
(t) Subsequent Expenditure
Subsequent expenditure is recognised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company and the cost of the item can be measured reliably.
(u) Cash Flow Statement
Cash flows are reported using the indirect method as per Accounting Standard 3, Cash Flow Statements, whereby profit for the period is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and item of income or expenses associated with investing or financing cash flows. The cash flows from the operating, investing and financing activities of the company are segregated. The company considers all highly liquid investments that are readily convertible to known amounts of cash to be cash equivalents.
Borrowing from Axis Bank Ltd:
Tenor: One year from the date of Sanction i.e. upto 16.08.2024 Sanctioned Amount : 3000 lakh CC limit and 150 lakh BG limit
1. Primary Security: Hypothecation of entire Current Assets of the Borrower, both present and future on exclusive basis.
2. Collateral Security: Extension of EM of the following properties on exclusive basis:
(a) Commercial Property located at Premises No. 90, Phears Lane, Kolkata - 700 012, P.S. Bowbazar, within the limits of Kolkata Municipal Corporation, Ward No. 44, owned by the M/s. Annapurna Agro Industries
(b) Residential Property located at Flat No. 701 & 702 on the 7th Floor at Indralok, 187, NSC Bose Road, Kolkata in the name of Darsh Advisory Pvt Ltd
(c) Residential Property situated at Holding No. 0140001490000X1, Town Plan Plot No. 706 (Part), Jamabandi No. 3096, Mouza - Shyamganj, Ward No. 20, P.S. Deoghar, P.S. No. 413, Dist. Deoghar owned by Anand Shaw
4. Liquid Collateral: Liquid Collateral of C0.30 Crores
5. Personal Guarantee of Mr. Nirmal Kumar Bhakat, Mr. Rajesh Shaw, Mr. Sumit Sengupta, Mr. Ritesh Shaw, Mr. Shreeram Bagla, Mr. Anand Kumar Shaw
6. Corporate Guarantee of M/s. Darsh Advisory Pvt Ltd
The Company has filed monthly returns or statements with such banks, where applicable, which are in agreement with the books of account
Borrowing from Yes Bank Ltd:
Tenor: 90 days from the date of disbursement and renewed subsequently.
Sanctioned Amount: 500 lakh WCDL @9.25% ROI
1. Personal Guarantee of Mr. Rajesh Shaw, Mr. Sumit Sengupta, Mr. Ritesh Shaw, Mr. Shreeram Bagla, Mr. Anand Kumar Shaw
2. The Company has filed monthly returns or statements with such banks, where applicable, which are in agreement with the books of account
Borrowing from Equentia Financial Service Pvt Ltd:
Tenor: Maximum 90 (Ninety) days from the relevant date of Drawdown, in accordance with the Finance Documents The Facility will be secured inter alia by:
(a) Second exclusive charge by way of hypothecation of all Receivables, book debts and Current Assets of the Borrower, both present and future.
b) 5 (five) undated cheques in favour of the Lender, provided as security, with due intimation to the drawee bank.
c) Unconditional and irrevocable personal guarantees of Ritesh Shaw & Shreeram Bagla.
d) Cash Collateral of 10% (Ten Percent) of the Facility (""Cash Collateral"")
e) Total purchase bill discounting limit of C800 Lakh & Term loan C700 Lakh sanctioned.
33. Other Statutory Compliance
(i) No proceedings have been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and the rules made thereunder.
(ii) There are no transactions with the companies whose names are struck off under section 248 of the Companies Act, 2013 or section 560 of the Companies Act, 1956 during the year ended 31 March 2024.
(iii) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(iii) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(v) The Company have not any such transaction which is 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.
(vi) The company is not declared as a wilful defaulter by any bank or financial institution or any other lender.
(vii) 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.
(viii) The Company has utilised the borrowed funds for the purposes for which the fund is obtained.
(ix) No funds 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(s) or entities, including foreign entities ("Intermediaries"), with the understanding that the intermediary shall whether directly or indirectly lend or invest in other persons or entities identified in any manner by or on behalf of the company (Ultimate Beneficiaries) or provide any guarantee, security or the like on behalf of ultimate beneficiaries;
(x) No funds have been received by the company from any person(s) or entities including foreign entities ("Funding Parties") with the understanding that such 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 guarantee, security or the like on behalf of the Ultimate beneficiaries.
(xi) The Current Assets, Loans & Advances are realisable in ordinary course of business at least equal to the amount at which they are stated in the Balance Sheet.
(xii) There are no indications of impairment on any individual cash generating assets or on cash generating units in the opinion of management and therefore no test of impairment is carried out.
34. Previous year Figures
Previous year figures have been regrouped / reclassified, where necessary, to conform to this year's classification.
Note:
1. Net Sales instead of Credit Sales have been considered for the purpose of computation of this ratio
2. Net Purchase instead of Credit Purchase have been considered for the purpose of computation of this ratio
38.1 Reasons for variations more than 25% as compared to previous year:
1. Change in debt-equity ratio and debt service coverage ratio is due to fresh loan taken for the year utilised in capex.
2. Change in Inventory Turnover Ratio is due to increase in inventory holding period to facilitate to increase production capacity.
3. Trade payable turnover ratio decreases due to increase in credit terms of some bulk vendors.
4. Change in Net Capital Turnover Ratio is due to Net Sales which has increased, whereas Working Capital has decreased comparative to previous year.
39 CORPORATE SOCIAL RESPONSIBILITY (CSR)
As per Section 135 of the Companies Act, 2013, a Company, meeting the applicability threshold, needs to spend at least 2% of its average net profit for the immediately preceding three financial years on corporate social responsibility (CSR) activities. The areas for CSR activities are promoting education, healthcare, art and culture, destitute care and rehabilitation, and rural development projects. A CSR committee has been formed by the company as per the Act. The details of funds primarily utilized through the year on these activities which are specified in the Schedule VII of the Companies Act, 2013 are as follows:
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