Notes to Accounts of Amforge Industries Ltd.

Mar 31, 2024

Note: 22.

In view of the loss incurred during the year, management as a matter of prudence, has not recognized deferred tax assets.

Note: 23. Contingent liabilities and commitments (to the extent not provided for)

(Rs in 000’s)
Particulars	31/03/2024	31/03/2023
Towards Excise Duty demands against which the Company has preferred appeal	46.524.00	46.524.00
Towards Sales Tax demands against which the Company has preferred appeal	13.167	13.167
Disputed Income Tax Demand	3908.96	-
Claims against the Company not acknowledged as debt	11.32	11.32

Fair Value hierarchy of financial assets and liabilities measured at fair value:

The fair values of the financial assets and liabilities are included in the amount at which the instrument could be exchanged in an orderly transaction in the principal (or most advantageous) market at the measurement date under the current market condition regardless of whether that price is directly observable or estimated using other valuation techniques.

The Company has established the following fair value hierarchy that categorises the values into 3 levels. The inputs to valuation techniques used to measure the fair value of financial instruments are:

Level 1: This hierarchy uses quoted (unadjusted) prices in active markets for identical assets or liabilities. The fair value of all bonds which are traded in the stock exchanges is valued using the closing price or dealer quotations as of the reporting date.

Level 2: The fair value of financial instruments that are not traded in an active market (For example traded bonds, over-the-counter derivatives) is determined using valuation techniques which maximize the use of observable market data and rely as little as possible on company-specific estimates. The mutual fund units are valued using the closing Net Asset Value. If all significant inputs required to fair value an instrument are observable, the instrument is included in Level 2.

Level 3: If one or more of the significant inputs are not based on observable market data, the instrument is included in Level 3.

Note: 27 Financial Instruments risk management objectives and policies

The Company’s principal financial liabilities comprise trade and other payables. The main purpose of these financial liabilities is to finance the company’s operations. The company’s principal financial assets include Loans & advances, investments and cash and cash equivalents that it derives directly from its operations.

a. Credit Risk

Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Company. Credit risk arises primarily from financial assets such as investments in mutual funds, financial instruments, other balances with banks and other receivables. The Company has adopted a policy of only dealing with counterparties that have a sufficiently high credit rating. The Company’s exposure and credit ratings of its counterparties are continuously monitored and the aggregate value of transactions is reasonably spread amongst the counterparties.

b. Liquidity risk

Liquidity risk is defined as the risk that the Company will not be able to settle or meet its obligations on time or at a reasonable price. Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the dynamic nature of the underlying businesses, the company maintains flexibility in funding by maintaining availability under committed credit lines.

Management monitors rolling forecasts of the Company’s liquidity position (comprising the undrawn borrowing facilities below) and cash and cash equivalents based on expected cash flows. This is carried out in accordance with practice and limits set by the Company. In addition, the company’s liquidity management policy involves projecting cash flows and considering the level of liquid assets necessary to meet these, monitoring balance sheet liquidity ratios against internal and external regulatory requirements and maintaining debt financing plans.

c. Market risk

Market risk is the risk of loss of future earnings, fair values or future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other market changes that affect market risk-sensitive instruments. Market risk is attributable to all market risk-sensitive financial

instruments including investments and deposits, foreign currency receivables, payables and borrowings. Capital Management

For the purpose of the Company’s capital management, capital includes issued capital and all other equity reserves attributable to the equity shareholders of the Company. The primary objective of the Company when managing capital is to safeguard its ability to continue as a going concern and to maintain an optimal capital structure to maximize shareholder value. As of 31/03/2024 and 31/03/2023, the Company has only one class of equity shares and has low debt. Consequent to such capital structure, there are no externally imposed capital requirements. To maintain or achieve an optimal capital structure, the Company allocates its capital for distribution as dividends or re-investment into business based on its long-term financial plans.

Note-28 Impairment of Assets

No material impairment of Assets has been identified by the Company as such during the year. Hence, no provision is required as per Ind AS -36 issued by the Institute of Chartered Accountants of India.

Note: 29 NBFC

The Company based on annual audited financial statements and the expert opinion obtained, is of the view that the Company is not liable to get itself registered as a Non-Banking Financial Company (NBFC) under section 45 IA of the Reserve Bank of India Act,1934.

There are no Companies/enterp rises under the Micro, Small & Medium Enterprises Development Act,2006, to whom the company owes dues on account of principal amount together with interest, and accordingly, no additional disclosure has been made. The above information regarding micro, a small & medium enterprise has been determined to the extent such parties have been identified based on information available with the Company.

Note 33ADDITIONAL REGULATORY INFORMATION REQUIRED BY SCHEDULE III TO THE COMPANIES ACT, 2013

(i) The Company does not have any benami property held in its name. No proceedings have been initiated on or are pending against the Company for holding benami property under the Benami Transactions (Prohibition) Act, 1988(45 of 1988) and Rules made thereunder.

(ii) The Company has not been declared a wilful defaulter by any bank or financial institution or other lender or government or any government authority.

(iii) The Company has complied with the requirement with respect to the number of layers as prescribed under section 2(87) of the Companies Act, 2013 read with the Companies (Restriction on number of layers) Rules, 2017

(iv) Utilisation of borrowed funds and share premium

i. The Company has not advanced or loaned or invested funds to any other person(s) or entity (ies), including foreign entities (Intermediaries) with the understanding that the Intermediary shall:

(a) 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

(b) Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries

ii. 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:

(a) 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

(b) provide any guarantee, security or the like on behalf of the ultimate beneficiaries.

(v) There is no income surrendered or disclosed as income during the year in tax assessments under the Income Tax Act, 1961 (such as search or survey), that has not been recorded in the books of account.

(vi) The Company has not traded or invested in cryptocurrency or virtual currency during the year

(vii) The Company does not have any charges or satisfaction of charges which are yet to be registered with the Registrar of Companies beyond the statutory period.

(viii) The company has not entered into any transaction with struck-off companies under section 248 ofthe Companies Act, 2013 during the year.

Note 34

The outstanding balances as of 31/03/2024 in respect of trade receivables, trade payables, short-term loan advances and deposits are subject to confirmation from the respective parties and consequential reconciliation/adjustments arising therefrom if any. The management, however, does not expect any material variation.

Note 35

Reliance is placed on the information given under section 164(2) of the Companies Act, 2013 by the management/ directors relating to the directors and their directorship in other companies. There are no amounts due to and from the companies, in which the directors are interested except as disclosed in the financial statements.

Note 36

Disclosure as per regulation 34(3)of the SEBI (Listing Obligations and Disclosure Requirements) Regulations , 2015

There are no loans and advances in the nature of loans given to subsidiaries, associates and others and investments shared of the company by such parties as of 31/03/2024 and 31/03/2023.

Note 37

In the opinion of the Board of Directors of the Company, the Current Assets, Loans and advances have a value on realization in the ordinary course of business at least equal to the amount stated in the Balance sheet.

Figures for the previous year have been given in the bracket and are regrouped, restated and rearranged wherever considered necessary.

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Mar 31, 2015

1.Rights, preferences and restriction attached to shares Equity Shares:

The Company has one class of equity shares having at par value of Rs. 2/- per equity share held. Each shareholder is eligible for one vote per share.

If any dividend is proposed by the Board of Directors, then the same is subject to approval of the share- holders in the ensuing Annual General Meeting except in the case of interim dividend.

In the unlikely event of the liquidation of the Company,the equity shareholders are eligible to receive the residual value of assets of the Company, if any, after all secured and unsecured creditors of the Company are paid off, in proportion of their shareholding in the Company.

2. Contingent liabilities and commitments (to the extent not provided for)

(Rs. 000''s)

As at 31st March 2015 2014

Bank Guarantees outstanding 944 944 in favour of the Government and other parties

Towards Excise Duty demands 46524 46524 against which the Company has preferred appeal

Towards Custom Duty demands - 12068 against which the Company has preferred appeal

Towards Sales Tax demands 13232 13232 against which the Company has preferred appeal

Claims against the Company 8444 8444 not acknowledged as debts

Others - Income Tax Demands 15469 15469

3. In terms of Accounting Standard - 17 (Segment Reporting) issued by the Institute of Chartered Accountants of India, the Company is engaged in Trading activities.

4. The outstanding balances as at 31/03/2015 in respect of trade receivables, trade payables, short term loans and advances and deposits are subject to confirmation from the respective parties and consequential reconciliation / adjustments arising there from if any. The management, however, does not expect any material variation.

5. The Company has given a Business advances of Rs. 21658 thousand, which is due for recovery. In view of management, the same is recoverable and has initiated the steps for recovery of the same.

6. Effective from 01/04/2014, the Company has charged depreciation based on the useful life of its assets as per the requirement of Schedule - II of the Companies Act, 2013. Deductions/ Adjustments under depreciation includes Rs.2732 thousand adjusted from the opening balance of the Profit and Loss Account of the fixed assets, whose remaining useful life was NIL as on 01/04/2014 based on transitional provisions of Schedule II of the Companies Act, 2013.

7. Disclosures as required by the Accounting Standard (AS) 18 -"Related Parties Disclosures" are given below:

A) Name of the Related Parties as Description of Relationship

Holding / Associates

(i) Nainesh Trading and Consultancy LLP

(ii) Viniyog Investment and Trading Company Private Limited

(Holding by virtue of control the composition of Board of Directors)

Interested by Director

M/s. Makar Estate

Key Management Personnel:

(i) Mr. Yogiraj Makar

(ii) Mr. Puneet Makar

(iii) Mrs. Reshma Makar

8. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

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Mar 31, 2014

1. Rights, preferences and restriction attached to shares

Equity Shares

The Company has one class of Equity Shares having a Par value of Rs. 2 per Equity Share.

Each Shareholder is eligible for one vote per Share.

If any dividend is proposed by the Board of Directors, then the same is subject to approval of the Shareholders in the ensuing Annual General Meeting except in the case of interim dividend.

In the unlikely event of the liquidation of the Company, the Equity Shareholders are eligible to receive the residual value of assets of the Company, if any, after all secured and unsecured creditors of the Company are paid off, in proportion of their shareholding in the Company.

2. Loans secured by exclusive hypothecation of respective vehicles. Other Loans are secured against the pledge of 430000 held by the company as investments in equity shares of Mahindra CIE Automotive Ltd. (formerly Mahindra Forgings Ltd.)

3. (i) Buildings include Rs. 0.5 thousands being cost of Shares in Co-operative Housing Societies.

(ii) Buildings includes three ownership flats, the possession of which is in dispute.

(iii) Vehicles includes Rs. 8917.92 thousands purchased on loan against hypothecation of such assets (P Y Rs. 7072.90 thousands).

4. Contingent liabilities and commitments (to the extent not provided for)

(Rs. 000''s)

Contingent Liabilities not provided for As at 31st As at 31st March, 2014 March, 2013

Bank Guarantees outstanding in favour of the Government and other parties 944 944

Towards Excise Duty demands against which 46.524 46.524 the Company has preferred appeal

Towards Custom Duty demands against which the Company has preferred appeal 12.068 12.068

Towards Sales Tax demands against which the company has preferred appeal 13.232 2.057



Claims against the Company not acknowledged as debts 8.444 9.119

Others - Income Tax Demands 15.469 15.469

5. In terms of Accounting Standard - 17 (Segment Reporting) issued by the Institute of Chartered Accountants of India, the Company is engaged in Trading activities.

6. The outstanding balances as at 31st March 2014 in respect of trade receivables, trade payables, short term loans and advances and deposits are subject to confirmation from the respective parties and consequential reconciliation / adjustments arising there from if any. The management, however, does not expect any material variation.

7. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

8. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

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Mar 31, 2013

Note 1: Contingent Liabilities and Commitments (to the extent not provided for)

(Rs. in 000''s)

As at As at

Contingent Liabilities not provided for 31st March, 2013 31st March, 2012

Bank Guarantees outstanding in favour of the 944 944 Government and other parties.

Towards Excise Duty demands against which the 46,524 48,557 Company has preferred appeal.

Towards Custom Duty demands against which the 12,068 12,068 Company has preferred appeal.

Towards Sales Tax demands against which the 2,057 2,057 company has preferred appeal.

Claims against the Company not acknowledged as 9,119 9,119 debts.

Others - Income Tax Demands 15,469 15,469



1. In terms of Accounting Standard–17 (Segment Reporting) issued by the Institute of Chartered Accountants of India, the Company is presently engaged in trading activities.

2. The outstanding balances as at 31st March 2013 in respect of trade receivables, trade payables, short term loans and advances and deposits are subject to confirmation from the respective parties and consequential reconciliation / adjustments arising there from if any. The management, however, does not expect any material variation.

3. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

4. Disclosures as required by the Accounting Standard (AS) 18–"Related Party Disclosures" are made below:

5. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

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Mar 31, 2012

1. Contingent liabilities and commitments (to the extent not provided for)

(Rs. in 000's)

As at 31st As at 31st March, 2012 March, 2011

(i) Bank Guarantees outstanding in favour of the Government and 944 944 other parties

(ii) Towards Excise Duty demands 48557 48557 against which the Company has preferred appeal

(iii) Towards Custom Duty demands 12068 12068 against which the Company has preferred appeal

iv) Towards Sales Tax demands against 2057 5250 which the company has preferred appeal

v) Claims against the Company not 9119 12531 acknowledged as debts

vi) Others - Income Tax Demands 15469 15469

vii) Towards assignment of debt of the company 83442 Nil

2. During the year the company has disposed of its assets along with Land & Building, Plant & Equipments etc and gains a rised on such disposal have been included in exceptional items, and has been netted of against certain write offs, which includes bad debts written of Rs. 27035 thousands.

3. During the year certain credit balances have been written back and included in exceptional items. In the same manner certain debit balances, which are unrecoverable, also been written back and included in exceptional item as shown above.

4. Pursuant to the resolution passed by the board of directors, the Company has disposed of entire 30,00,000 Equity Shares of Rs. 10/- each fully paid up in the wholly owned subsidiary of the Company namely Dujon Commercial Private Limited, during the year & Dujon Commercial Pvt. Ltd. is ceased to be a subsidiary of the company. The Loss arising on such disposal has been included in exceptional items.

5. Other Advances of Rs. 15166 thousands were paid towards expenses incurred/payments to a consultants' firm for performance improvement program at one of the Company's plants, the Company has filed a suit for recovery of the amounts paid/expenses incurred along with compensation for damages and Company has also deposited Rs. 7312 thousands with the Hon'ble Bombay High Court, have been written of during the year.

6. In terms of Accounting Standard - 17 (Segment Reporting) issued by the Institute of Chartered Accountants of India, the Company is operating in one segment i.e. Forgings.

7. The outstanding balances as at 31st March 2012 in respect of trade receivables, trade payables, short term loans and advances and deposits are subject to confirmation from the respective parties and consequential reconciliation/adjustments arising there from if any. The management, however, does not expect any material variation.

8. Disclosures as required by the Accounting Standard (AS) 18 - "Related Party Disclosures" are made below:

(A) Name of the related parties and description of relationship:

Associates/Group i) Nainesh Trading & Consultancy LLP (Formerly Nainesh Investment & Companies/Firms Trading Co. Pvt. Ltd.)

ii) Nainesh Investment & Trading Co. Pvt. Ltd (Converted into LLP w.e.f. 12-09-2011)

iii) Viniyog Investment & Trading Company Private Limited

iv) Devidass Private Limited

v) Dujon Commercial Private Limited

vi) Makar Estate Key management

i) Mr. Yogiraj Makar personnel:

ii) Mr. Puneet Makar

9. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.

10. The financial Statements for the year ended 31st March, 2011 were prepared as per then applicable erstwhile Schedule - VI to the Companies Act, 1956. Consequent to the notification of Revised Schedule - VI under the Companies act, 1956, financial statements for the year ended 31st March, 2012 are prepared as per Revised Schedule - VI. Accordingly the previous year figures have also been reclassified to conform to this classification for adoption of revised Schedule - VI. The previous year's figures does not impact recognition and measurement principles followed for preparation of financial Statements.

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Mar 31, 2010

1. Borrowings And Securities

(i) Other Loans include Vehicle / Machinery Loans, which are secured by exclusive hypothecation of such Asset. Machinery Loan is additionally secured by personal guarantee of one of the Directors.

(ii) In terms of Scheme of Demerger, Mahindra Forgings Ltd. (MFL) (Formerly Mahindra Automotive Steels Ltd.) has agreed to Guarantee to discharge Debt of Rs. 83450 thousands of the remaining business as of the appointed date i.e. 1st April, 2005 and also agreed to guarantee payment of Interest on the above said debts from the appointed date. Pursuant to this, MFL has discharged a debt of Rs.70659 thousands till the end of the current financial year.

2. Income-tax assessments have been completed upto Assessment Year 2007-08 (A.Y. 2006-07). The demand of Rs. 10103 thousands has been raised for A.Y. 2005- 06 & Rs. 12148 thousands has been raised, for A.Y. 2007 - 08. The Company has disputed these demands and filed an appeal with CIT (Appeals). In the opinion of the Management, company does hot envisage any further liability, in the above matter.

(Rs. in 000s)

3. Contingent Liabilities not provided for As at 31st As at 31st

March, 2010 March, 2009

(i) Bank Guarantees outstanding in favour of the Government and other parties 944 944

(ii) Towards Excise Duty demands against which the Company has preferred appeal 48557 48557

(iii) Towards Custom Duty demands against which the Company has preferred appeal 12068 12068

(iv) Towrads Sales Tax demands against which the compnay has preferred appeal 3193 00

(v) Claims against the Company not acknowledged as debts 14658 14326

(vi) Others (Income tax) 22251 10103

4. Estimated value of contracts remaining to be executed on capital account (net of advances) and not provided for Rs. Nil (Prev. Year Rs. Nil).

5. Advances recoverable in cash or in kind include Rs. 15166 thousands (Rs.15166 thousands) towards expenses incurred/ payments to a consultants firm for performance improvement program at one of the Companys plants. Since in view of management, the consultants have not achieved and delivered the mutually agreed upon projected results, the Company has filed a suit for recovery of the amounts paid/expenses incurred along with compensation for damages. The Company has also deposited Rs. 7312 thousands with the Honble Bombay High Court. The matter is subjudice. Requisite adjustments will be made on attaining finality.

6. The acturial valuation of annual contribution towards gratuity amounting to Rs.314.25 thousands (Rs.7625.23 thousands) has not been funded to the approved gratuity fund.

7. Subsequent to suspension of operation from Dec.2008, the Company has declared a Lockout w.e.f. 28th May, 2009 under sub-section 2 of section 24 of the Maharashtra Recognition of Trade Union and Prevention of Unfair Labour Practices Act, 1971.

8. During the year. Sales Tax Assessment of Chakan Unit (Demerged Undertaking) for the F Y 2001-02 to F Y 2004-05 was completed and the Sales Tax Liability of Rs. 7674 thousands has been raised and the same has been provided in the current years accounts together with the interest of Rs. 1488 thousands and included in Exceptional Items.

During the year the company has also recovered an amount of Rs. 2000 thousands from one of the debtors, which was written off in the earlier years from the books of accounts and the same is included in Exceptional Items. The company has also written back certain unclaimed credit balance of the creditors and the same has been credited to exceptional items amounting to Rs.2531.25 thousands.

9. Due to lock-out at Chinchwad factory, the test as required as per AS - 28, Impairment of Assets could not be carried out. However, the management does not envisage any impairment loss during the year.

10. During the year, company has further acquired 14.00,000 Equity Shares of Rs. 10/- each at a premium of Rs. 65/- per share in the wholly owned subsidiary of the Company namely Dujon Commercial Private Limited.

11. In terms of Accounting Standard - 22. issued by the Institute of Chartered Accountants of India, (Accounting for Taxes on Income). For the current year. Deferred Tax Asset of Rs. 1235 thousands (Deferred Tax Asset of Rs. 36755 thousands) has been recognized in the Accounts as the management is of the opinion that the Company will be able to utilize the balance Deferred Tax Asset against future taxable income as per the applicable current Income Tax Laws.

The major components of the Deferred Tax Assets / (Liability) as on 31st March, 2010 based on the tax effects of the timing differences, are as follows.

12. In terms of Accounting Standard - 17 (Segment Reporting) issued by the Institute of Chartered Accountants of India, The

13. Related Party Disclosures as required by Accounting Standard - 18 issued by the Institute of Chartered Accountants of India, are given below :

A. Relationships:

(a) Associates / Group Companies / Firm

i. Nainesh Investment & Trading Co. Pvt. Ltd.

ii. Viniyog Investment & Trading Co. Pvt. Ltd.

iii. Devidass Private Ltd.

iv. Dujon Commercial Private Limited

v. Makar Estates

(b) Key Management Personnel:

(i) Mr. Yogiraj Makar

(ii) Mr. Puneet Makar

14. In the absence of information from suppliers as to their status, the Company does not possess a list of small scale suppliers covered under MSMED, Act. 2006. It is therefore not possible to determine the amount due and interest (if any) thereon as required by "The Interest on Delayed Payments to Micro, Small and Medium Enterprises Development Act, 2006".

15. The outstanding balances as at 31st March 2010 in respect of Sundry debtors. Creditors. Loans and Advances and Deposits are subject to confirmation from the respective parties and consequential reconciliation / adjustments arising there from if any. The Management. however, does not expect any material variation.

16. Figures for the previous year have been given in the bracket and are regrouped and rearranged wherever necessary.