j) Provisions, Contingent Liabilities and Contingent Assets
The Company recognises a provision when there is a present obligation as a result of a past event that probably requires an outflow of the Company's resources embodying economic benefits and a reliable estimate can be made of the amount of the obligation. A disclosure of contingent liabilities is made when there is a possible obligation that may, but probably will not, require an outflow of company's resources. As a measure of prudence, the contingent assets are not recognised.
k) Cash and Cash Equivalents-For the Purpose of Cash Flow Statements:
For the purpose of Cash Flow Statements, cash and cash equivalents include Cash on Hand and Balances with Banks in the Current Account.
l) Operating Cycle:
Based on the activities of the company and normal time between incurring of liabilities and their settlement in cash or cash equivalents and acquisition/right to assets and their realization in cash or cash equivalents, the company has considered its
operating cycle as 12 months for the purpose of classification of its liabilities and assets as current and non-current.
m) Foreign Currency Transactions
The transactions in foreign currency have been recorded using the rate of exchange prevailing on the date of transactions. The difference arising on the settlement/restatement of the foreign currency denominated Current Assets/Current Liabilities into Indian rupees has been recognized as expenses/income (net) of the year and carried to the statement of profit and loss.
n) Government Grant/Subsidy:
Government Grants/Subsidy available to the Company are accounted on the basis:
i) Where there is reasonable assurance that the company will comply with the Conditions attached to them, and
ii) where such benefits have been earned by the Enterprise and it is reasonably certain that the ultimate collection will be made.
iii) nature of the grant i.e. whether in the nature of capital contribution or in the form of revenue.
o) Insurance Claims:
Insurance claims are accounted for on the basis of claims admitted / expected to be admitted and to the extent that there is no uncertainty in receiving the claims.
p) Research and Development:
Expenditures on research phase is recognized as an expense when they are incurred.
Expenditures on development phase are recognized as an intangible asset if they are likely to generate probable future economic benefits and the cost of the same can be measured reasonably and can be attributed the intangible assets.
q) Investments:
The investment in Gold is intended to be held for a period exceeding operating cycle of the business of the company and accordingly it is classified as "Non-Current Investment" and has been carried at cost of acquisition in the financial statements.
Investments in subsidiaries i.e. domestic and foreign have initially been recognised at cost and subsequently carried at cost less accumulated impairment losses measured at the end of each year, if any.
The investments in subsidiaries are intended to be held for a period exceeding operating cycle of the business of the company and accordingly it is classified as "Non-Current Investment" and has been carried at cost of acquisition in the financial statements.
r) Employee Benefit Expenses:
Short term employee benefits like wages, salaries, bonus and other monetary and non-monetary benefits are recognized in the period during which services are rendered by the employees and are recognized at the value at which liabilities have been settled or are expected to be settled.
The Company's contribution to the Provident Fund and ESIC is remitted as per the applicable provisions relating to the Employee Provident Fund Scheme and ESIC and such contributions
are charged to the Statement of Profit & Loss of the period to which contributions relates. The company's obligations towards gratuity, leave encashment or other terminal benefits if any as may be applicable will be recognized in the period in which such obligations with individual employee be settled.
s) Current/Non-Current Classifications:
The Company presents assets and liabilities in the financial statements on the basis of their respective classifications into current and non-current.
Assets:
An asset is treated as current when it is:
• Expected to be realised or intended to be sold or consumed in normal operating cycle
• Held primarily for the purpose of trading
• Expected to be realised within twelve months after the reporting period
• Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting period.
All other assets are classified as non-current.
Liabilities:
A liability is treated as current when it is:
• Expected to be settled in normal operating cycle
• Held primarily for the purpose of trading
• Due to be settled within twelve months after the reporting period
• No unconditional right to defer the settlement of the liability for at least twelve months after the reporting period.
All other liabilities are classified as non-current.
- Common Security:
A. Primary Security
- First and Exclusive Charge by way of Hypothecation of Current Assets and Movable Fixed Assets both present and future.
B. Collateral Security:
i. First and Exclusive Charge by way of Mortgage of Plot No. 123, Devraj Industrial Park, Survey No. 114, Block No. 757 Paiki, Mouje: Lambha, Taluka: Vatva, Dist.: Ahmedabad land admeasuring 15732 Square feet and Contruction Area 6845 Square Feet owned by the Company.
ii. First and Exclusive Charge by way of Mortgage of Office No. 208, 2nd Floor, Dev Shruti Complex, Survey No. 3907 & 3908, TPSN-3, Ellisbridge, FPN-442/1 & 442/2, Mouje Changispur, Tal: Sabarmati, Dist.:Ahmedabad construction admeasuring 1317 Square Feet owned by the Company.
C. ECLGS Loans further secured by way of :
First Charge in Favour of AU Small Finance Bank and Second Charge in Favour of National Credit Guarantee Trustee Company (NCGTC) of cash flows and security along with existing credit facilities.
** Outstanding balances of term loans and working capital term loans secured by personal/corporate guarantees of the following:
- Directors
Mr. Ritesh Vinay Patel
Mr. Vinay Rajnikant Patel *** Terms of Repayment:
The principal amount of term loans/working capital term loans to be paid as under:
i. Enterprises Term Loan A/c. No. AU - 9001231629009223- To be repaid by 78 Monthly Instalment of ' 1,52,248 each inclusive of interest.
ii. Enterprises Term Loan A/c. No. AU - 9001231629009333- To be repaid by 69 Monthly Instalment of ' 89,022 each inclusive of interest.
iii. Working Capital Term Loan A/c. No. ECLGS 9001160529009421-To be repaid by 24 Monthly Instalment (Including May-22) of ' 58,623 each inclusive of interest.
iv. Working Capital Term Loan A/c. No. ECLGS 9001160529009521-To be repaid by 54 Monthly Instalment including moratorium period of 18 months (Including May-22) of ' 42,289 each inclusive of interest.
**** Nature of Default, If Any
No Defualt as on the Balance Sheet Date.
* Nature of Security
The working capital loans from AU Small Finance Bank secured along with terma loans/working capital term loans as under:
- Common Security:
A. Primary Security
- First and Exclusive Charge by way of Hypothecation of Inventory, Book Debts, Current Assets and Movable Fixed Assets both present and future.
B. Collateral Security:
i. First and Exclusive Charge by way of Mortgage of Plot No. 123, Devraj Industrial Park, Survey No. 114, Block No. 757 Paiki, Mouje: Lambha, Taluka: Vatva, Dist.: Ahmedabad land admeasuring 15732 Square feet and Contruction Area 6845 Square Feet owned by the Company.
ii. First and Exclusive Charge by way of Mortgage of Office No. 208, 2nd Floor, Dev Shruti Complex, Survey No. 3907 & 3908, TPSN-3, Ellisbridge, FPN-442/1 & 442/2, Mouje Changispur, Tal: Sabarmati, Dist.:Ahmedabad construction admeasuring 1317 Square Feet owned by the Company.
** Outstanding balances of working capital secured by personal/corporate guarantees of the following:
- Directors
Mr. Ritesh Vinay Patel
Mr. Vinay Rajnikant Pate
*** Terms of Repayment
To be Repaid on Demand
*** Nature of Default, If Any
No Defualt as on the Balance Sheet Date.
$ For Nature of Security, Terms of Repayment, Gurantee Offered and Nature of Defaults Refer to Note No. 4.
NOTE 7: TRADE PAYABLES
c) Operating Segment:
The Company identifies operating segments on the basis of dominant source, nature of risks and returns and the internal organization. The operating segments are the segments for which separate financial information is available and for which operating profit/loss amounts are evaluated regularly by the Managing Director/Chief Executive Officer who is Company's chief operating decision maker in deciding how to allocate resources and in assessing performance.
The dominant source of income of the company from its activities do not materially differ in respect of risk perception and the return realized/to be realized. Even the geographical/regulatory environment in which the company operates does not materially differ considering the political and economic environment, the type of customers, assets employed and the risk and return associated in respect of each of the geographical area. So, the disclosure requirements pursuant to "Segment Reporting" are not applicable.
d) Issue of Convertible Share Warrants:
The Board of Directors of the company at its meeting held on 28th February, 2024 approved allotment of 57,00,000 warrants convertible into 57,00,000 equity shares of face value of ' 10/- each at a price of ' 175/- per share (including premium of ' 165/- per share) on preferential allotment in compliance with the provisions of SEBI (ICDR) Regulations, 2018 and amendments thereto and other applicable regulations of SEBI and after obtaining necessary approvals from Statutory Authorities including National Stock Exchange where the shares of the company are listed on the basis of valuation obtained from Registered Valuer. The offer of 57,00,000 warrants has been fully subscribed by the allottees. The company has received ' 24,93,75,000 being 25.00% of the warrant issue price at the time of subscription which has been separately disclosed in as "Money Received Against Issue of Share Warrants" as part of Shareholder's Fund in the Financial Statements. The balance 75.00% amount is payable at the time of exercise of warrant(s) by the Warrant-holder(s).
e) Debtors From Operating Activities:
The company has initiated proceedings/taken actions for recovery against the doubtful debtors amounting to ' 1,08,80,111/- (' 76,15,214/- classified as non-current and ' 32,64,897 classified as Current Trade Receivable) (Previous Year 76,15,214/-). In view of the management of the company, it is most likely that the company will be able to recover the amount from the doubtful debtors and hence the company has not made any provision against the doubtful debts of ' 1,08,80,111/- (Previous Year ' 76,15,214/-).
However, considering the uncertainty over the time period over which the amounts are expected to realized, the outstanding balances of doubtful debts of ' 76,15,214 have been classified as long-term trade receivables under the head "Other Non-Current Assets" in the balance sheet and will be classified as short-term trade receivable if it is expected with reasonable certainty that the amounts will be recovered within twelve months from the end of the balance sheet date. The balance amount of Trade Receivables of ' 32,64,897 has been classified as "Current Trade Receivable".
f) Investment in Subsidiaries:
The company has made an investment during the year in an Indian Subsidiary company Rivita Solutions Private Limited with 51% shareholding in the company. The cost of investment in the company is ' 51,000. The investment in the company has been recognized at cost and has been carried at cost of acquisition.
Further, the company has also made an investment of ' 5,43,84,458 during the year in a wholly owned foreign subsidiary Felix Industries SPC, Oman. The investment has been recognized at cost and has been carried at cost of acquisition.
g) The company has communicated suppliers to provide confirmations as to their status as Micro, Small or Medium Enterprise registered under the applicable category as per the provisions of the Micro, Small and Medium Enterprises (Development) Act, 2006 (MSMED Act, 2006). The company has classified suppliers into Micro, Small and Medium Enterprises as per the confirmations received by the company upto the date of the financial statements and accordingly other suppliers are classified as Non-MSME Suppliers irrespective of their status as per the provisions of the Micro, Small and Medium Enterprises (Development) Act, 2006 (MSMED Act, 2006).
h) In the opinion of the Board of Directors, Current Assets & Loans and Advances have a value on realisation in the ordinary course of business equal to the amount at which they are stated in the balance sheet. In the opinion of the Board of Directors, claims receivable against property/goods are realizable as per the terms of the agreement and/or other applicable relevant factors and have been stated in the financial statements at the value which is most probably expected to be realized.
i) All the balances of debtors and creditors, loans and advances and unsecured loans are subject to confirmation and subsequent reconciliation, if any.
(a) On Account of substantial increase in advances paid to suppliers and short-term loans & advances given during the year 2023-24 compared the preceding financial year.
(b) On Account of further issue of share capital during the year and increase in accumulated balances of Reserves and Surplus resulting from proceeds of securities premium on issue of share capital and profits earned during the year.
(c) Resulting from reduction in debts as at the end of the current financial year compared to the preceding financial year and higher profitability during the current financial year.
(d) Resulting from Higher Average Inventory holding during the current financial year compared to the preceding financial year on account of execution of pending orders.
(e) On Account of reduction in payment cycle period to the trade payables.
(f) Resulting from higher deployment of funds in short term loans and advances having effect on higher net working capital.
(g) Availability of funds and better resources management resulted into improvement in turnover and cost management having positive impact on net profitability.
k) Relationship with Struck off Companies:
The company does not have any transaction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of
Companies Act, 1956, during the current year and in the previous year.
l) The Financial Statements were authorised for issue by the Board of Directors on 30th May, 2024.
m) 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(s) or entity(ies), including foreign entities ("Intermediaries"), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, 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.
No funds (which are material either individually or in the aggregate) have been received by the company from any person(s) or entity(ies), including foreign entities ("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.
n) The previous year's figures have been reworked, regrouped and reclassified wherever necessary so as to make them comparable with those of the current year.
The Financial Statements have been presented in Indian Rupee (') in Lakhs rounded off to two decimal points as per amendment to Schedule III to the Companies Act, 2013.
The figures wherever shown in bracket represent deductions/negative amount.
SIGNATURES TO NOTES '1'TO '30'
FOR AND ON BEHALF OF THE BOARD FOR S. N. SHAH & ASSOCIATES
FELIX INDUSTRIES LIMITED CHARTERED ACCOUNTANTS
FIRM REG. NO.: 109782W
Sd/- Sd/-
MANAGING DIRECTOR DIRECTOR
[RITESH PATEL] [VINAY PATEL]
[DIN:05350896] [DIN:08377751]
Sd/- Sd/- Sd/-
UDAY CHANDULAL SHAH HENA SHAH FIROJ G. BODLA
[CHIEF FINANCIAL OFFICER] [COMPANY SECRETARY] PARTNER
M. NO. 126770
PLACE: AHMEDABAD DATE: 30TH MAY, 2024
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