16.2 Rights, preferences and restrictions attached to Equity shares : The company has one class of equity shares having a par value of Rs. 10 per share. Each shareholder is eligible for one vote per share. The dividend if any, proposed by the Board of Directors is subject to the approval of shareholders in the ensuing annual general meeting, except in case of interim dividend. In the event of liquidation, the equity shareholders are eligible to receive the remaining assets of the Company, after distribution of all preferential amounts, in proportion of their shareholding.
16.5 During the period of 5 years immediately preceding 31“ March, 2024 :-
a. the company has not allotted any shares pursuant to contract(s) without payment being received in cash
b. bought back any shares
c. agreegate no. of equity shares allotted as fully paid up by way of bonus Shares during the year 2022-23 in the ratio of 1 (One) Equity Share for every 3 (Three) existing Equity Shares are 23,22,950
Nature and purpose of Reserves General Reserve
The general reserve is created from time to time on transfer of profit from retained earnings. General reserve is created by transfer from one component of equity to another and is not an item of other comprehensive income, items included in general reserve will not be reclassified subsequently to profit and loss.
Capital reserve
Capital reserve was created out of forfeiture of partly paid equity shares of the company on account of unpaid calls. Reserve can be utilised as per the provisions of the Companies Act, 2013.
Security Premium
Security premium is created on recording of premium on issue of shares. The reserve can be utilised in accordance with the provision of the Companies Act, 2013.
Equity Instrument through Other Comprehensive Income
The Company has elected to recognise changes in fair value of equity instrument (investments) in other comprehensive income. The fair value changes are accumulated within this reserve and shall be adjusted on derecognition of investments.
Retained Earnings
The same is created out of profit over years and shall be utilised as per the provisions of the Companies Act, 2013.
Note :
a. Term loan of Rs. 39.47 lacs taken from HDFC Bank Ltd. and term loan of Rs. 117 lacs taken from Daimler financial Services Pvt. Ltd. for purchase of vehicles. These loans are secured by exclusive first charge on the vehicle purchased through loan.
Above term loans are repayable as under:
(i) Term loan from HDFC bank Ltd. - Sanctioned amount Rs 30.00 lacs outstanding Rs. 6.49 lacs (Previous Year Rs. 13.03 lacs) is repayable in 60 monthly installments (EMI) of Rs. 0.62 lacs (including Interest) commencing from March, 2020 and last installment is due in the month of February, 2025. Rate of interest as at the year end 8.55% p.a. (Previous Year 8.55% P.A).
(ii) Term loan from HDFC Bank ltd. - Sanctioned amount Rs 9.47 lacs outstanding Rs.5.49 lacs (Previous Year Rs. 7.28 Lacs) is repayable in 60 monthly installments (EMI) of Rs. 0.19 lacs (including Interest) commencing from December, 2021 and last installment is due in the month of November, 2026. Rate of interest as at the year end 7.50% p.a. (Previous Year 7.50% P.A.).
(iii) Term loan from Daimler Financial Services Pvt. Ltd. - Sanctioned amount Rs 55.00 lacs outstanding Rs. NIL(Previous Year Rs. 10.04 lacs) is repayable in 36 monthly installments (EMI) of Rs. 1.72 lacs (including Interest) commencing from October, 2020 and last installment was due in the month of September, 2023. Rate of interest as at the year end 8.00% p.a. (Previous Year 8.00% PA).
(iv) Term loan from Daimler Financial Services Pvt. Ltd. - Sanctioned amount Rs 62.00 lacs outstanding Rs.46.09 lacs (Previous Year Rs.52.74 lacs) is repayable in 60 monthly installments (EMI) of Rs. 0.90 lacs (including Interest) commencing from October, 2021 and last installment is due in the month of September, 2026. Rate of interest as at the year end 8.27% p.a. (Previous Year 8.27% P.A.)
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34. Contingent Liabilities and Commitments
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(Amount ' in lacs)
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Particulars
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As at 31st March, 2024
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As at 31st
March, 2023
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A Contingent Liabilities
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a) Estimated amount of claims against the Company not acknowledged as debts in respect of:
- Income tax demand disputed in appeals
- Sales Tax, VAT Demand disputed in appeals
- Other Matter in Appeals
(Amount deposited Rs. 171.40 lacs (Previous Year Rs. 157.35 lacs)
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709.22
2626.85
19.49
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709.22
2626.85
19.49
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1) The company does not expect any reimbursements in respect of the above contingent liabilities.
2) It is not practicable to estimate the timing of cash outflows if any is respect of above matters due to pending resolution of the arbitration/appellate proceedings further the liability mentioned in to above includes interest expect in cases where the company has determined that the possibility of such levy is remote.
B Commitments
Estimated amount of contracts remaining to be executed on capital account and not provided for Rs. Nil (Previous Year Rs. Nil).
35. The Company has been sanctioned non fund based credit facilities of Rs. 1100 lacs by Punjab National Bank Limited and Rs. 500 lacs by HDFC Bank Ltd.. Non fund based facilities are secured by hypothecation of entire current assets of the Company present and future, and further secured by -
- Hypothecation charge over all movables assets, equipments and fixtures of the company located at the Company's plant at Village Akolia, Pithampur, Distt. Dhar, (M.P.).
- 10% cash margin in the form of term deposit receipts.
- Equitable mortgage on Company's plant situated at Village Akolia, Pithampur, Distt. Dhar, (M.P.).
- Personal guarantee of others.
36. Leases :
Company as a lessee
i) Amount not included in measurement of lease liability and recognized as expenses in the statement of profit and loss during the year as Rs. 8.07 lacs (Previous Year Rs. 14.83 lacs).
ii) Total cash outflow for short term leasers amount Rs. 8.37 lacs during the year (Previous Year Rs. 14.70 lacs)
The company has adopted Ind AS 116 'Leases' effective from April 1,2019 and elect not to apply the requirement of Ind AS 116 since leases are short term leases.
Where company is lessor
The building given on cancellable operating lease are included in Property, Plant and Equipment.
The aggregate amount of operating lease income recognized in the Statement of Profit and Loss is Rs. 18.00 lacs (Previous Year Rs. 18.00 lacs).
37. Employee Benefit :
(A) Defined contribution plans
In respect of defined contribution plans, an amount of Rs. 4.29 lacs (Previous Year: Rs. 5.14 lacs) towards employer contribution to provident fund and Rs. 0.83 lacs (Previous Year : Rs. 0.92 lacs) towards employer contribution to ESIC and admin. charges in respect of PF Rs. 0.20 lacs (Previous Year : Rs. 0.21 lacs) have been recognised in the statement of profit and loss for the year.
(B) Defined benefit plans
The company provides for gratuity for its employees as per the Payment of Gratuity Act 1972. Employees who are in continuous service for a period of 5 years are eligible for gratuity. The Company has opted for scheme with Life Insurance Corporation of India( "LIC" ) to cover its liabilities towards employees gratuity. The Company also carries out Actuarial valuation of gratuity using Projected Unit Credit Method as required by Ind As - 19 and the difference between fair value of plan assets and liability as per actuarial valuation as at the year end is recognised in financial staetement as assets / liabilities.
Inherent Risks
The plan is of a final salary defined benefit in nature which is sponsored by the Company and hence it underwrites all the risks pertaining to the plan. In particular, there is a risk for the Company that any adverse salary growth or demographic experience or inadequate returns on underlying plan assets can result in an increase in cost of providing these benefits to employees in future. Since the benefits are lump sum in nature the plan is not subject to any longevity risks.
(C) LEAVE ENCASHMENT
The liability in respect of leave encashment is determined using actuarial valuation carried out as at Balance Sheet date. Actuarial gain and losses are recognized in full in statement of Profit and Loss for the year in which they occur.
Liability on account of Leave Encashment as at the year end Rs. 5.47 lacs (Previous Year Rs. 4.25 lacs).
48. Financial risk management objectives and policies
In its ordinary operations, the companies activities expose it to the various types of risks, which are associated with the financial instruments and markets in which it operates. The company has a risk management policy which covers the foreign exchanges risks and other risks associated with the financial assets and liabilities such as interest rate risks and credit risks. The risk management policy is approved by the board of directors. The following is the summary of the main risks:
a) Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates (currency risk) and interest rates (interest rate risk), will affect the companies income or value of it's holding of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return.
i) Interest rate risk
Interest rate risk is the risk the the fair value or future cash flow of a financial instrument will fluctuate because of changes in market interest rate. Fair value interest rate risk is the risk of changes in fair value of fixed interest bearing financial instrument because of fluctuations in the interest rates. Cash flow interest rate risk is the risk that the future cash flows of floating interest bearing financial instrument will fluctuate because of fluctuations in the interest rates.
The Company's exposure to the risk of changes in market interest rates relates primarily to the borrowing from banks and others. Currently company is not using any mitigating factor to cover the interest rate risk.
ii) Foreign currency risk
The Company enters into transactions in currency other than its functional currency and is therefore exposed to foreign currency risk. The Company analyses currency risk as to which balances outstanding in currency other than the functional currency of that Company. The company enters in to derivative financial instrument such foreign currency forward contract and option contracts to mitigate the risk of changes in exchange rate on foreign currency exposure.
(b) Credit risk
Credit risk is the risk that arises from the possibility that the counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. Financial assets that are subject to such risk, principally consist of trade receivables, Investments and loans and advances. None of the financial insturments of the company results in material concentration of credit risk. Financial assets are written off when there is no reasonable expectation of recovery, however, the Company continues to attempt to recover the receivables. Where recoveries are made, these are recognised in the Statement of Profit and Loss. The impairment for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Company's past history, existing market conditions as well as forward looking estimates at the end of each balance sheet date.
Trade and other receivables
To Manage trade and other receivables, the company periodically assesses the financial reliability of customers, taking in to account the financial conditions, economic trends, analysis to historical bad debts and ageing of such receivables."
Investments
"InvestmentsThe Company limits its exposure to credit risk by generally investing in liquid securities and only with counter-parties that have a good credit rating. The Company does not expect any losses from non-performance by these counter-parties apart from those already given in financials, and does not have any significant concentration of exposures to specific industry sectors or specific country risks."
Cash & Cash Equivalents
The Company holds cash & cash equivalents with credit worthy banks of Rs. 193.18 lacs as at 31st March, 2024 (Rs.85.62 lacs as at 31st March, 2023). The credit worthiness of such banks is evaluated by the management on an ongoing basis and is considered to be good.
(c) Liquidity risk
Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company has obtained non-fund based working capital line from bank. The company's treasury department is responsible for liquidity, funding as well as settlement management. In addition, process and policies related to such risk are overseen by senior management. Management moniters the company's net liquidity position through rolling forecasts on the basis of expected cash flows.
Capital Management
For the purpose of the Company's capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity shareholders of the Company. The Company's objective when managing capital is to safeguard its ability to continue as a going concern so that it can continue to provide returns to shareholders and other stake holders.
The Company manages its capital structure and makes adjustments in light of changes in the financial condition and the requirements of the financial covenants. To maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to shareholders (buy back its shares) or issue new shares.
No changes were made in the objectives, policies or processes for managing capital during the year ended 31st March, 2024 and 31st March, 2023.”
* Excludes Investment in Partnership Firm Rs. 304.54 Lacs (Previiouys Year NIL)
To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into three levels prescribed under the Ind AS. An explanation for each level is given below.
Level 1:Quoted (unadjusted) market prices in active markets for identical assets or liabilities.
Level 2: Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable
Level 3: Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.”
52. The provisions related to Corporate Social Responsibility (CSR) under section 135 of the Companies Act, 2013 and rules made thereunder are not applicable to the Company.
53. Additional Regulatory Information
i. The company has not granted Loans or Advances in the nature of loans to promoters, directors, KMPs and the related parties (as defined under Companies Act, 2013,) either severally or jointly with any other person, that are: (a) repayable on demand or (b) without specifying any terms or period of repayment.
ii. The company neither have any Benami property nor any 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.
iii. The company is not declared wilful defaulter by any bank or financial Institution or other lender.
iv. The company does not have any transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.
v. The company has not made any investments till 31st March, 2024 in subsidiary company hence compliance 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 is not applicable.
vi. (A) The company has not advanced or loaned or invested funds (either borrowed funds or share premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries) with the understanding (whether recorded in writing or otherwise) that the Intermediary shall (i) 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 (ii) provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries;(B) The company has not received any fund from any person(s) or entity(ies), including foreign entities (Funding Party) with the understanding (whether recorded in writing or otherwise) that the company shall (i) 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 (ii) provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries."
vii. The Company does not have any 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).
viii. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
ix. The Company has borrowings from banks or financial institutions on the basis of security of current assets.Quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts.
x. There were no registration of charge or satisfaction of charge is pending for registration with ROC.
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