Notes to Accounts of Jattashankar Industries Ltd.

Mar 31, 2025

7. Provisions:

A provision is recognized when the Company has a present obligation as a result of past events 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 (excluding retirement benefits) are determined based on the best estimate
required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and
adjusted to reflect the current best estimates

8. Property, Plant and Equipment:

Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at
historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the
acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying
cash flow hedges of foreign currency purchases of property, plant and equipment. Subsequent costs are
included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is
probable that future economic benefits associated with the item will flow to the Company and the cost of the
item can be measured reliably. The carrying amount of any component accounted for as a separate asset is
derecognized when replaced. All other repairs and maintenance are charged to profit or loss during the
reporting period in which they are incurred.

9. Depreciation:

Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values,
over their estimated useful lives. The residual values are not more than 5% of the original cost of the asset.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying
amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are
included in profit or loss within other gains/ (losses).

10. Capital Work-in-Progress

The cost of self-constructed assets includes the cost of materials & direct labour, any other costs directly
attributable to bringing the assets to the location and condition necessary for it to be capable of operating in
the manner intended by management and borrowing costs.

Expenses directly attributable to construction of property, plant and equipment incurred till they are ready
for their intended use are identified and allocated on a systematic basis on the cost of related assets.

11. Statement of Cash Flows

Cash Flow Statement has been prepared in accordance with the Indirect method prescribed in Ind AS 7
‘Statement of Cash Flows’.

12. Inventories:

i ) Raw Material ,stores & spares are valued at cost.

ii ) Finished goods are valued at lower of cost or net realizable value.

iii ) Work in Progress are valued at estimated cost.

13. Financial assets measured at fair value:

Financial assets are measured at ‘Fair value through other comprehensive income’ (FVOCI) if these
financial assets are held within a business model whose objective is to hold these assets in order to collect
contractual cash flows or to sell these financial assets and the contractual terms of the financial asset give
rise on specified dates to cash flows that are solely payments of principal and interest on the principal
amount outstanding.

The Company in respect of equity investments (other than in subsidiaries, associates and joint ventures)
which are not held for trading has made an irrevocable election to present in other comprehensive income
subsequent changes in the fair value of such equity instruments. Such an election is made by the Company
on an instrument by instrument basis at the time of initial recognition of such equity investments. Financial
asset not measured at amortized cost or at fair value through other comprehensive income is carried at ‘Fair
value through the statement of profit and loss’ (FVPL).

14. Income Taxes:

Income Tax Expense comprises Current and Deferred Tax. Current Tax is the expected tax payable on the
taxable income for the year, using tax rates enacted or substantively enacted and as applicable at the
reporting date, and any adjustment to tax payable in respect of previous years. Current Income Taxes are
recognised under ‘Income Tax payable’ net of payments on account, or under ‘Tax receivables’ where there
is a debit balance. Deferred Tax is recognised using the Balance Sheet method, providing for temporary
differences between the carrying amounts of assets and liabilities for financial reporting purposes and the
amounts used for taxation purposes.

24. Contingent liabilities not provided in the accounts:

There was no Contingent Liability as on 31.03.2025.

25. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation
and adjustment required, if any.

26. Disclosure required under Ind As-19 “Employee Benefits” are as under:

(i) The Company has recognized the expected liability of Gratuity as at 31st March, 2025 based on
actuarial valuation carried out using the Project Unit Credit Method.

(ii) The below disclosure has been obtained from independent actuary. The other disclosures are made
in accordance with Ind AS-19 pertaining to the Defined Benefit Plan is as given below:

29. The company mainly deals in yarns and Elastic tapes which are considered only one
segment of Textile Products therefore, disclosure of segment reporting pursuant to Ind AS -
108 is not required.

30. In view of the applicability of Ind AS -12 on “Accounting for Taxes of Income” issued by
the ICAI, Company does not have net deferred tax liability due to excess of deferred tax
Assets over deferred tax liability.

31. No Dividend declared in the current year.

32. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006
(MSMED ACT, 2006)

The Company does not have any dilutive potential equity shares. Consequently, the basic and
diluted earnings per share of the Company remain the same.

35. During the year ended March 31, 2025, the company has sold its Plant
and machineries at sale value at Rs.101.14 Lakhs at a loss of Rs 80.76
Lakhs resulting in the discountinuance of its operational activities. Due to
above exceptional matter limited income has been generated in the current
year

36. Pursuant to the provisions of the Securities and Exchange Board of India (Substantial
Acquisition of Shares and Takeovers) Regulations, 2011, an Open Offer has been made by
Tarunkumar Gunvantlal Patel, Vedant Tarunbhai Patel, Vishal Prakashbhai Ashara, Keval
Jayanti Khudai and Nileshbhai Bhagvanji Bapodara for acquisition of up to 11,40,646 equity
shares representing 26% of the total paid-up equity share capital of the Company at a price
of K 60/-per share.

The open offer was triggered due to execution of the share purchase agreement by the
acquirers on dated 20/12/2024 to purchase 31,82,900 equity shares consisting 72.55% of
the fully paid up equity shares at a consideration of Rs.60/- per equity share and was
formally announced through a public announcement dated 17/03/2025 after getting
approval from SEBI.

• The open offer does not result in any direct impact on the financials of the Company.

• No accounting entry is required in the books of the company.

Disclosure & Compliance:

The Company has complied with all statutory disclosure requirements with stock exchanges
and SEBI.

• The Company continues to operate as a going concern with no impact on daily
operations or management as on the date of this note.

37. There are no significant subsequent events that would require adjustments or disclosures in
the financial statements as on the Balance Sheet date.

Note

1. Due to increase in current Investment and reduction of current liabilities , there is increase
current ratio in current year as compared to previous year.

2. Due to decrease in Operating revenue and exceptional Loss of Rs 110.91 Lakhs during
current year as compared to previous year exceptional gain of Rs 303.04 Lakhs,there is
decrease in Return on Equity ratio,Net Profit Ratio and Return on capital employed ratio .

3. Due to increase in Cost of goods and decrease in average inventory , there is increase in
inventory turnover ratio in current year as compared to previous year.

4. Due to decrease in operating revenue and increase in working capital due to increase in
current investment , there is decrease in capital turnover ratio in current year as compared to
previous year

*During current year , Net Profit after Tax includes exceptional Loss of Rs 110.91 Lakhs as

against exceptional gain of Rs 303.04 Lakh(net of tax) during the previous year

** During current year , earing Before Tax includes exceptional loss od Rs 110.91 lakhs as

against exceptional gain of Rs 367.42 Lakhs during previous year .

39. Previous year figures have been regrouped / rearranged wherever is necessary.

AS PER OUR REPORT OF EVEN DATE ATTACHED FOR AND ON BEHALF OF THE BOARD OF

DIRECTORFOR K K JHUNJHUNWALA & CO. JATTASHANKAR INDUSTRIES LIMITED

CHARTERED ACCOUNTANTS

FIRMS REG. NO. 111852W. Sd/- Sd/-

Sd/- JATTASHANKAR PODDAR SHARAD PODDAR

(Managing Director) ( Director)

SURENDRA SUREKA DIN : 00335747 DIN : 00335806

PARTNER Sd/- Sd/-

M. NO. 119433 ANKUR S. PODDAR Varsha Maheshwari

PLACE : MUMBAI. (Chief Financial Officer) (Company Secretary)

Date 30/05/2025

UDIN -25119433BMHPSZ2006

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Mar 31, 2024

7. Provisions:

A provision is recognized when the Company has a present obligation as a result of past events 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 (excluding retirement benefits) are determined based on the best estimate required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimates

8. Property, Plant and Equipment:

Freehold land is carried at historical cost. All other items of property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the

acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash flow hedges of foreign currency purchases of property, plant and equipment. Subsequent costs are included in the asset’s carrying amount or recognized as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognized when replaced. All other repairs and maintenance are charged to profit or loss during the reporting period in which they are incurred.

9. Depreciation:

Depreciation is calculated using the straight-line method to allocate their cost, net of their residual values, over their estimated useful lives. The residual values are not more than 5% of the original cost of the asset. The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss within other gains/ (losses).

10. Capital Work-in-Progress

The cost of self-constructed assets includes the cost of materials & direct labour, any other costs directly attributable to bringing the assets to the location and condition necessary for it to be capable of operating in the manner intended by management and borrowing costs.

Expenses directly attributable to construction of property, plant and equipment incurred till they are ready for their intended use are identified and allocated on a systematic basis on the cost of related assets.

11. Statement of Cash Flows

Cash Flow Statement has been prepared in accordance with the Indirect method prescribed in Ind AS 7 ‘ Statement of Cash Flows''’.

12. Inventories:

i ) Raw Material ,stores & spares are valued at cost.

ii ) Finished goods are valued at lower of cost or net realizable value.

iii ) Work in Progress are valued at estimated cost.

13. Financial assets measured at fair value:

Financial assets are measured at ‘Fair value through other comprehensive income’ (FVOCI) if these financial assets are held within a business model whose objective is to hold these assets in order to collect contractual cash flows or to sell these financial assets and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

The Company in respect of equity investments (other than in subsidiaries, associates and joint ventures) which are not held for trading has made an irrevocable election to present in other comprehensive income subsequent changes in the fair value of such equity instruments. Such an election is made by the Company on an instrument-by-instrument basis at the time of initial recognition of such equity investments. Financial asset not measured at amortized cost or at fair value through other comprehensive income is carried at ‘Fair value through the statement of profit and loss’ (FVPL).

14. Income Taxes:

Income Tax Expense comprises Current and Deferred Tax. Current Tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted and as applicable at the reporting date, and any adjustment to tax payable in respect of previous years. Current Income Taxes are recognised under ‘Income Tax payable’ net of payments on account, or under ‘Tax receivables’ where there is a debit balance. Deferred Tax is recognised using the Balance Sheet method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

24. Contingent liabilities not provided in the accounts:

There was no Contingent Liability as on 31.03.2024.

25. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation and adjustment required, if any.

26. Disclosure required under Ind As-19 “Employee Benefits” are as under:

(i) The Company has recognized the expected liability of Gratuity as at 31st March, 2024 based on actuarial valuation carried out using the Project Unit Credit Method.

(ii) The below disclosure has been obtained from independent actuary. The other disclosures are made in accordance with Ind AS-19 pertaining to the Defined Benefit Plan is as given below:

27. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary. There are no contingent liabilities other than those stated above.

28. Related Party Disclosures

As per Ind AS 24, the disclosures of transaction with the related parties are given below:

a) Related party relationship where transaction have taken place during the year Enterprise over which Key Managerial Personnel exercise significant influence/control

(i) Sunrise Colours Limited

(ii) Subhash Poddar HUF (Karta of Jattashankar Poddar & Sharad Poddar)

(iii) Sharad Poddar HUF (Sharad Poddar is Karta of HUF)

29. The company mainly deals in yams and Elastic tapes which are considered only one segment of Textile Products therefore, disclosure of segment reporting pursuant to Ind AS -108 is not required.

30. In view of the applicability of Ind AS -12 on “Accounting for Taxes of Income” issued by the ICAI, Company does not have net deferred tax liability due to excess of deferred tax Assets over deferred tax liability.

31. No Dividend declared in the current year.

32. Disclosure under Micro, Small and Medium Enterprises Development Act, 2006 (MSMED ACT, 2006)

As required to be disclosed under Micro, Small & Medium Enterprises Development Act, 2006 and to the extend such parties are identified on the basis of information available with the company, there are no micro enterprises or small scale enterprises to whom the company owes any undisputed dues which are outstanding for more than 45 days as at 31st March, 2022.

The Company does not have any dilutive potential equity shares. Consequently, the basic and diluted earnings per share of the Company remain the same.

35. There are no significant subsequent events that would require adjustments or disclosures in the financial statements as on the Balance Sheet date.

1. Due to increase in current Investment there is increase current ratio in current year as compared to previous year.

2. Due to increase in Operating revenue , Non operating income and exceptional gain of Rs 303.04 lacs(Net of Tax) , resulting into increase in Return on Equity ration, Net Profit ratio and Return on capital employed ratio in the current year as compared to previous year.

3. Due to increase in operating revenue and decrease in average inventory , there is increase in inventory turnover ratio in current year as compared to previous year.

4. Due to increase in purchase and Expenses and decrease in average creditors , there is increase in trade payable turnover ratio in current year as compared to previous year

5. Due to increase in Current Investment and increase in income , there is increase in ratio of return on investment in current year as compared to previous year.

* The company considers Revenue from Operations, in place of Cost of Goods Sold (COGS) for

calculating Inventory Turnover Ratio.

**Net profit after Tax includes exception gain of Rs 303.04 lacs net of tax

***Earning Before Tax Includes exceptional gain Rs 367.42 lacs

37. Previous year figures have been regrouped / rearranged wherever is necessary.

AS PER OUR REPORT OF EVEN DATE ATTACHED FOR AND ON BEHALF OF THE BOARD OF

DIRECTOR FOR K K JHUNJHUNWALA & CO. JATTASHANKAR INDUSTRIES LIMITED

CHARTERED ACCOUNTANTS

FIRM''S REG. NO. 111852W. Sd/- Sd/-

Sd/- JATTASHANKAR PODDAR SHARAD PODDAR

(Managing Director) ( Director)

SURENDRA SUREKA DIN : 00335747 DIN : 00335806

PARTNER Sd/- Sd/-

M. NO. 119433 ANKUR S. PODDAR Varsha Maheshwari

PLACE: MUMBAI. (Chief Financial Officer) (Company Secretary)

Date 30/05/2024

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Mar 31, 2015

1. Contingent liabilities not provided for in the accounts There were no Contingent Liability as on 31.03.2015.

2. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation and adjustment required, if any.

3. Gratuity liability has been provided for during the year of Rs.1,66,463/- . However the same has not been provided for on actuarial basis as prescribed in Accounting Standard -15.

4. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary .There are no contingent liabilities other than those stated above.

5. Pursuant to requirement of Accounting Standard -18, issued by the ICAI, the details of transactions carried out during the year with related parties are disclosed as under :-

Relationships:

(a) Key Management Personnel

(i) Jattashankar Poddar

(ii) Sharad Poddar

(b) Relative of Key Management Personnel and their Enterprises where transactions have taken place

(i) Sunrise Colours Limited

(ii) Shivkripa Enterprises Private Limited

(iii) Subhash Poddar HUF ( Karta of Jattashankar Poddar & Sharad Poddar)

(iv) Sharad Poddar HUF ( Sharad Poddar is Karta of HUF)

Disclosure in respect of material transactions with related parties during the year

6. The company mainly deals in Dyed yarns and Elastic tapes which are considered only one segment of Textile Products therefore, disclosure of segment reporting pursuant to Accounting Standards -17 issued by the ICAI is not required.

7. In view of the applicability of Accounting Standards -22 accounting for taxes on income issued by the ICAI, company does not have deferred tax liability due to carried forward losses. In the opinion of the management deferred tax asset is not recognized in view of uncertainty of future taxable profits.

8. Earning Per Share (EPS) pursuant to Accounting Standard -20 issued by the ICAI as under:

9. There were no Impairment of Fixed Assets during the year pursuant to requirement of Accounting Standard -28 issued by the ICAI.

10. Previous year's figures have been regrouped / rearranged wherever is necessary.

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Mar 31, 2014

1. Contingent liabilities not provided for in the accounts

There were no Contingent Liability as on 31.03.2014

2. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation and adjustment required ,if any.

3. Gratuity liability has been provided during the year instead of cash basis as per past practice. Due to this profit for the year is understated by Rs.1,00,000/-.

4. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary .There are no contingent liabilities other than those stated above.

5. To the extent information available with the Company ,amount payable to Micro, Small and Medium Enterprise creditors are not overdue .Hence Provision for interest has not been made.

6. The company mainly deals in texturised /twisted yarns which are considered only one segment therefore, disclosure of segment reporting pursuant to Accounting Standards -17 issued by the ICAI is not required.

7. a) In view of the applicability of Accounting Standards -22 accounting for taxes on income issued by the ICAI , company does not have current tax as well as deferred tax liability due to carried forward losses. In the opinion of the management deferred tax asset is not recognized in view of uncertainty of future taxable profits.

b) No provision for Tax has been made under provision of Income tax Act, 1961, as there are no tax liability likely to arise in view of company declared sick by BIFR & having huge accumulated losses.

8. There were no Impairment of Fixed Assets during the year pursuant to requirement of Accounting Standard -28 issued by the ICAI.

9. Previous years figures have been regrouped / rearranged wherever is necessary. As per our report of even date

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Mar 31, 2013

1 Contingent liabilities not provided for in the accounts

There were no Contingent Liability as on 31.03.2013

2. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation and adjustment required ,if any.

3. a) Provision for gratuity Liability has not been actuarially determined. Amount is unascertained, as the same is treated on cash basis.

b) Leave encashment liability has been provided during the year instead of cash basis as per past practice. Due to this profit for the year is understated by Rs. 50,000/-.

4. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary .There are no contingent liabilities other than those stated above.

5. To the extent information available with the Company ,amount payable to Micro, Small and Medium Enterprise creditors are not overdue .Hence Provision for interest has not been made.

6 The company mainly deals in textures /twisted yarns which are considered only one segment therefore,

disclosure of segment reporting pursuant to Accounting Standards -17 issued by the ICAI is not required.

7 During last year ,as per Rehabilitation scheme sanctioned by BIFR order dated 23.02.2012 , Company has given effect of OTS with secured Lenders by writing back Loan of Rs. 10,18,79,266/-and accrued interest thereon provided in the accounts of Rs. 3,53,81,909/-. OTS amount were financed by strategic promoter investor-Shivkripa Enterprises Pvt. Ltd . Now as per above referred BIFR Scheme ,amount payable to said promoter is shown as unsecured loan.

8 a) In view of the applicability of Accounting Standards -22 accounting for taxes on income issued by the ICAI , company does not have current tax as well as deferred tax liability due to carried forward losses. In the opinion of the management deferred tax asset is not recognized in view of uncertainty of future taxable profits.

b) No provision for Tax has been made under provision of Income tax Act, 1961, as there are no tax liability likely to arise in view of company declared sick by BIFR & having huge accumulated losses .

9. There were no Impairment of Fixed Assets during the year pursuant to requirement of Accounting Standard -28 issued by the ICAI.

10 Additional information as required under schedule VI of companies'' act 1956 as certified by the management is as under:-

A) Stores & spares consumed are wholly indigenous during the current year and previous year. 33. Previous year''s figures have been regrouped / rearranged wherever is necessary .

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Mar 31, 2012

1. Contingent liabilities not provided for in the accounts

Disputed excise demand for the appeal is pending before higher authorities amounting to Rs. 11,11,073/- ( P.Y. Rs. 11,11,073/-)

2. The company had been declared sick as per the order of BIFR dtd. 14.06.02 & Central bank of India has been appointed as Operating Agency. Hon. BIFR, as per Order dated 23.02.2012, has sanctioned Rehabilitation Scheme of Company with Cost Of Scheme of Rs. 1027.34 Lacs and Means of Finance by promoter contribution.

Accordingly Company has given effect of OTS with secured Lenders by writing back Loan and accrued interest thereon provided in the accounts as under:

Name of Nature Of Loan Principal Amt Accrued Interest Lenders (Rs.) (Rs.)

IDBI Term Loan for Project 3,35,00,000 2,47,14,323

GSFC Term Loan for Project 0 1,02,82,473

CBI Working Capital 6,83,79,266 3,85,113

10,18,79,266 3,53,81,909

The Company has done OTS with the Secured Lenders –IDBI and CBI via assignment deed in favour of strategic Promoters Investor –Shivkripa Enterprises pvt. Ltd. duly approved by Board of Directors. Now as per above referred BIFR Scheme, amount payable to said promoter is shown as unsecured loan.

3. Balance of sundry debtors, Creditors and loans and advances are subject to confirmation, reconciliation and adjustment required, if any.

4. Provision for gratuity & Leave Encashment Liability has not been actuarially determined. Amount is unascertained, as the same is treated on cash basis.

5. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary .There are no contingent liabilities other than those stated above.

6. Sales is shown net of claims, Rate difference & Discount of Rs. 1,40,862/- (P.Y. Rs. Nil/-)

7. The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures as required by Notification dated 16th November, 2007 issued by Ministry of Corporate Affairs have not been made.

8. Land at Vapi, purchased from Directors of Rs. 8,57,452/- during 1999-2000 for which agreement is yet to be executed.

9.(a) Salary included in schedule of operating & other expenses include managerial remuneration :

b) Commission on net profit is not payable to managing director and the whole time director for the year; hence computation of net profit in accordance with section 198 of the companies Act, 1956 is not required.

10. The company mainly deals in texturised/twisted yarns which are considered only one segment therefore, disclosure of segment reporting pursuant to Accounting Standards-17 issued by the ICAI is not required.

11. a) In view of the applicability of Accounting Standards -22 accounting for taxes on income issued by the ICAI, company does not have current tax as well as deferred tax liability due to carried forward losses. In the opinion of the management deferred tax asset is not recognized in view of uncertainty of future taxable profits.

b) No provision for Tax has been made under provision of Income tax Act, 1961, as there are no tax liability likely to arise in view of company declared sick by BIFR & having huge accumulated losses .

12. There were no Impairment of Fixed Assets during the year pursuant to requirement of Accounting Standard 28 issued by ICAI.

13 Additional information as required under schedule VI of companies' act 1956 as certified by the management is as under:-

c) Stores & spares consumed are wholly indigenous during the current year and previous

14. Previous years figures have been regrouped/rearranged wherever is necessary .

15. Figures shown in bracket are for the previous year

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Mar 31, 2010

1. Contingent liabilities not provided for in the accounts

a) Disputed excise demand for the appeal is pending before higher authorities amounting to Rs.11,11,073/- ( P.Y.Rs.11,11,073/-)

b) The company has received notice from Excise department for debiting excise duty of Rs.17,33,150/- (P.Y. Rs.17,33,150/-) on yarns lost in floods .The company has made application with the deputy Commissioner Excise for remission of excise duty on same .

c) Disputed Income Tax matters relating to disallowance of sundry balance written off of Rs.1,54,16,891/- (P.Y.Rs.1,82,18,307/-) for the assessment year 2001-02 .

2. i) Term loan excluding interest accrued and due from I.D.B.I , which has been assigned to Shivkripa Enterprises Private Limited under One Time Settlement Scheme as per Assignment Deed dated 23.09.05 , to the extent of Rs.2,85,00,000/- ( Previous Year Rs.2,85,00,000/-) is secured by mortgage of all the immovable property of the company situated at plot no.77,admeasuring 1000 sq meter at Silvassa and hypothecation of movable properties of the company including movable plant and machinery ,machinery spares ,fools and accessories and other movables ,both present and future ( Save and except book debts) subject to prior charges created /to be created on specified current assets in favor of company 's bankers for securing the borrowing for working capital and also personal guarantee of the promoter Directors of the company.

ii) Terms loans excluding interest accrued & due from G.S.F.C. to the extent of Rs.3,35,30,166/- (Previous year Rs.3,35,30,166/-) are secured by first charge of hypothecation of specific plant and machineries and personal guarantee of the promoter directors of the company.

iii) Term loan excluding interest accrued and due from I.D.B.I., which has been assigned to Shivkripa Enterprises Private Limited under One Time Settlement Scheme as per Assignment Deed dated 23.09.05 , to the extent of Rs.2,50,00,000/- ( Previous Year Rs.2,50,00,000/-) is secured by mortgage of all the immovable property of the company situated at plot no.77,admeasuring 1000 sq meter at Silvassa and hypothecation of specified movable assets , present & future acquired under Asset Credit Scheme and also by hypothecation of other movable plant and machinery ,machinery spares ,fools and accessories and other movables ,both present and future ( Save and except book debts) subject to prior charges created /to be created on specified current assets in favor of company 's bankers for securing the borrowing for working capital and also personal guarantee of the promoter Directors of the company.

iv) Working capital facility from Central Bank Of India, which has been assigned to Shivkripa Enterprises Private Ltd. under One Time Settlement Scheme as Per Assignment Deeds dated 10.04.07, are secured by hypothecation of Raw materials, Work in Progress, Finished goods, Book Debts and other assets and personal guarantee of the promoter directors of the company and second charge on block of fixed assets of the company.

3. Balance of sundry debtors, Creditors and loans and advances including loan from G.S.F.C. are subject to confirmation, reconciliation and adjustment required ,if any.

4. Provision for gratuity & Leave Encashment Liability has not been actuarially determined. Amount is unascertained, as the same is treated on cash basis.

5. In the opinion of management, sundry debtors, Loans and advances are approximately of the value stated, if realized in the ordinary course of business. The provisions of all liabilities are adequate and not in excess of the amount reasonably necessary .There are no contingent liabilities other than those stated above.

6. Sales is shown net of claims , Rate difference & Discount of Rs.44,607 /- (P.Y. Rs.8, 17,792/-)

7. The Company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures as required by Notification dated 16th November, 2007 issued by Ministry of Corporate Affairs have not been made.

8. Land at Vapi , purchased from Directors of Rs.8,57,452/- during 1999-2000 for which agreement is yet to be executed.

b) Commission on net profit is not payable to managing director and the whole time director for the year; hence computation of net profit in accordance with section 198 of the companies Act, 1956 is not required.

9. The company mainly deals in texturised /twisted yarns which are considered only one segment therefore, disclosure of segment reporting pursuant to Accounting Standards –17 issued by the ICAI is not required.

10. a) In view of the applicability of Accounting Standards –22 accounting for taxes on income issued by the ICAI , company does not have current tax as well as deferred tax liability due to carried forward losses. In the opinion of the management deferred tax asset is not recognized in view of uncertainty of future taxable profits. b) No provision for Tax has been made under provision of Income tax Act, 1961, as there are no tax liability likely to arise in view of company declared sick by BIFR & having huge accumulated losses .

11. The company had sold certain assets including plant & machinery of Rs.1,49,39,413/-(Net block) in earlier years which were discarded from operation .However the same is subject to approval from Financial Institutions .

12. The company has been declared sick as per the order of BIFR dtd.14.06.02 & Central bank of India has been appointed as Operating Agency.. Rehabilitation proposal is under process. The company has done Techno Economic Viability Study (TEVS) of the Rehabilitation proposal and submitted the said report to the bank and same is under review by the lenders. However the accounts are prepared on going concern basis.

13. a) Interest for the year on secured loan taken from financial institutions and others of Rs.8,85,66,848/-( P.Y.Rs.8,85,66,848/-) has not provided for during the year. Accumulated interest not provided for Rs.62,10,82,274/-(P.Y.Rs.53,25,15,426/-) Due to, this loss for the year and secured loan are understated to that extent.

b) Loans from the financial institutions & others are shown secured of Rs.19,02,80,026/- including interest provided up to 31.03.2001. However the same are secured to Rs.1,61,35,196/-.Therefore the said loans are unsecured by Rs.17, 41, 44,830/-.

14. The Company has done One Time Settlement with Central Bank of India via Assignment of Debts in favor of Strategic Promoter Investor Shivkripa Enterprises Private Limited as per Board Resolution dated 28.03.07 and Assignment Deeds dated 10.04.07 which is yet to be registered .

15. There were no Impairment of Fixed Assets during the year pursuant to requirement of Accounting Standard 28 issued by ICAI.

16. Inventory of Finished goods and work in progress include stock lying with third party for job work Rs. Nil ( P. Y. 62,95,923/-) .

17 Sundry Debtor includes Rs.24,05,211/- (P.Y.Rs. NIL) due from M/s Sunrise Colors Ltd. A company under the same management within the meaning of sub section (1-B) of section 370 of the companies Act 1956.

Note: The company is getting dyed yarn produced on job from outside.

- Excludes Job Production 612053 kg (Previous Year 3643 kg)

- Excludes captive consumption 6401 kg.( Previous year 539241 kg)

- Sales does not include rate difference , claims and discount given of Rs.44,607/- (P.Y. Rs.8,17,792/-)

* The above does not include Rate difference ,Claims & discount received of Rs. Nil /- (P.Y. Rs.6,73,592/-).

E) Stores & spares consumed are wholly indigenous during the current year and previous year.

18. Previous years figures have been regrouped / rearranged wherever is necessary .

19. Figures shown in bracket are for the previous year .