Notes to Accounts of Lords Chemicals Ltd.

Mar 31, 2011

1. Contingent Liabilities Not Provided For :

i) LCL has received demand notice from Sales Tax Authority of Rs.22,95,247.00 (previous year Rs.20,66,665.00) for the financial year 2003-2004, 2004-2005 & 2006-2007. LCL has filed the appeal before the Appellate Authorities.

ii) LCL has received demand notice from Central Excise Authority of Rs.9,03,120.00 (previous year Rs.9,03,092.00) for the year 2006-2007. LCL has filed an appeal before the CESTAT.

2. Disclosure of Amalgamation under Accounting Standard - 14 of ICAI :

(a) The Hon''ble Calcutta High Court has vide its order dated 17th May, 2012 approved the merger of Lords Chemicals Limited (Transferee Company) with Jagati Cokes Private Limited (Transferor Company) effective from 1st April, 2010 (appointed date).

(b) The approved scheme is an amalgamation in the nature of Merger and

accounting has been done on the basis of "the Pooling of Interest Method" as prescribed by AS-14 of ICAI. All assets, liabilities and other transactions of transferor Company with effect from 1st April, 2010 has been incorporated in the books of transferee company at book value as a going concern on line by line basis except its subscribed, issued and paid-up capital of Rs. 6,93,00,000/- which has been accounted as under in the financial statement as per approved scheme:

(i) As per the approved scheme, the Authorized Share capital of the Transferor Company has been added to the Authorized Share Capital of the Transferee Company and forms part of the Authorized Share Capital of the Transferee Company without any further act or deed.

(ii) Pending allotment formalities, a total amount of Rs. 6,93,00,000/- representing 6930000 fully paid equity shares of Rs. 10/- each of the Transferee Company to be issued to the Shareholders of Transferor Company (exchange ratio being 1:1) has been shown as the Share Capital Suspense Account.

3. Secured Loans :

The Working Capital Loans are secured by:

First charge on the entire current assets of the Company,

Equitable Mortgage of the Factory Land & Building being assets of Transferor Company, Hypothecation of Plant & Machinery being assets of Transferor Company, Personal guarantee by directors of the Company.

4. Managerial Remuneration :

(a) The company has paid remuneration by way of salary to its Managing Director and Director within the limit specified under Schedule XIII and approved by the board and shareholders of the Company. The details of remuneration paid during the year are as follows.

5. Deferred Tax Liability :

In terms of Accounting Standard - 22, net Deferred Tax liability of Rs. 29,62,090.00 has been recognized in the books of accounts. The component of the deferred tax liability at respective balance sheet date is as follows:-

6. Sundry creditors include Rs. Nil due to micro, small & medium enterprises to the extent such parties have been identified from the available documents /information.

7. Excise duty on finished goods is neither provided nor the same is considered for valuation of closing stock. This has no impact on the profit for the year.

8. The balances in various accounts in sundry creditors, sundry debtors and loans & advances are subject to confirmation and reconciliation. Company has shown the figures as per values appearing in the books of accounts.

9. Segment Information :

The Company''s business activity primarily falls within a single reportable segment i.e. Chemical Products, which are subject to similar risk and returns. Hence, there is no separate segment reporting which is in conformity with the Accounting Standard-17 issued by The Institute of Chartered Accountants of India.

* (As certified by the Management and on which Auditors have placed reliance, this being a technical matter)

Note: - i) The above figures are inclusive of transit losses and shortages,

ii) The above figure also net of discount.

10. Additional information as required under Part IV of Schedule VI of the Companies Act, 1956 is annexed.

11. Figures of the previous year have been regrouped /rearranged wherever necessary. The current year figures are not comparable with the previous year figures owing to the scheme of amalgamation.

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Mar 31, 2010

1, Contingent Liabilities Not Provided For :

i) LCL has received demand notice from Sales Tax Authority for t 20,66.665.00 (previous year X 4,61,562.00} for the financial year 3003-04, 2004-05 & 2006-07, LCL has filed the appeal before the Appellate Authorities.

ii) LCL has received demand notice from Central Excise Authority for Rs 9,03,092.00 (previous year Rs 9,03,092.00) for the year 2006-071 LCL has filed an appeal before the CESTAT

2. Secured Loans :

The working capital loans are secured by way of the foflowing :

First charge against all Book debts, stock and personal guarantee by di/ectons.

3. Managerial Remuneration :

(a) The company has paid remuneration by way of salary to its Managing Director and Director within the limit specified under Schedule XIII and approved by the board and shareholders of the Company. The details of remuneration paid during the year are as follows :

4. Segment Information :

The Companys business activity primarily falls within a single reportable segment i,e. Chemical Products, which are subject to similar risk and returns. He nee h there is no separate segment reporting which is in conformity with the Accounting Standard-17 issued by The Institute of Chartered Accountants of

5. Figures of the previous year have been regrouped / rearranged wherever necessary.

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Mar 31, 2009

1. Contingent Liabilities Not Provided For (If Any)

(Amount in Rupees)

SI. No.Particulars 31 st March 2009 31 st March 2008

01. NIL NIL NIL

2. Secured Loans

The working capital loans are secured by way of the following :

First charge against all Book debts, stock and personal guarantee by directors.

3. Sundry creditors include Rs. Nil due to micro, small & medium enterprises to the extent such parties have been identified from the available documents / information.

4. Excise duty on finished goods is neither provided nor the same is considered for valuation of closing stock. This has no impact on the profit for the year.

5. The balances in various accounts in sundry creditors, sundry debtors and loans & advances are subject to confirmation and reconciliation. Company has shown the figures as per values appearing in the books of accounts.

6. Segment Information:

The Companys business activity primarily falls within a single reportable segment i.e. Chemical Products, which are subject to similar risk and returns. Hence, there is no separate segment reporting which is in conformity with the Accounting Standard-17 issued by The Institute of Chartered Accountants of India.

7. Related Party Disclosure :

- Name of the related parties with whom the transactions were carried out during the year.

Names of the Related Parties Relationship

Mr. Ajay Kumar Jain Key Managerial Person (KMP)

Mr. Navin Kumar Jain Key Managerial Person (KMP)

Mr. Partha Majumdar Key Managerial Person (KMP)

Mahabir Coke Industries (P) Ltd. Associates

AKJ Minerals Ltd. Associates

Jupiter Coke Industries KMPs are Partner

Mr. Vimal Kumar Jain Relative of KMP

Mrs. Manju Jain Relative of KMP

8. Particulars on remittances of dividend in foreign currency

i) Number of Non Resident Shareholders Nil (Nil)

ii) Number of equity shares held by them Nil (Nil)

iii) Amount of remittance on account of dividend Nil (Nil)

9. Figures of the previous year have been regrouped / rearranged wherever necessary.

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Mar 31, 2008

1. Contingent Liabilities Not Provided For (If Any)

(Amount in Rupees) SI. No Particulars 31st March 2008 31st March 2007

01. Outstanding Bank Guarantee NIL 12,53,560.00

2. Secured Loans Nature of Security

i) For Term Loan :

The Rupee Term loan from banks are secured by way of the Security of short-term deposit of Rs. 4,00,00,000/-.

ii) The working capital loans are secured by way of the following :

First charge against all Book debts, stock and personal guarantee by directors.

3. In terms of Section 115JB of the Income Tax Act, 1961, Minimum Alternate Tax amounting to Rs. 6,38,345.00 for the year ended 31st March 2008 has been provided in the accounts.

4. Sundry creditors include Rs. Nil due to micro, small & medium enterprises to the extent such parties have been identified from the availbable documents / information. .

5. Excise duty on finished goods is neither provided nor the same is considered for valuation of closing stock. This has no impact on the profit for the year.

6. The balances in various accounts in sundry creditors, sundry debtors and loans & advances are subject to confirmation and reconciliation. Company has shown the figures as per values appearing in the books of accounts.

7. Segment Information:

The Companys business activity primarily falls within a single reportable segment i.e. Chemical Products, which are subject to similar risk and returns. Hence, there is no separate segment reporting which is in conformity with the Accounting Standard-17 issued by The Institute of Chartered Accountants of India.

8. Figures of the previous year have been regrouped / rearranged wherever necessary.

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Mar 31, 2007

1. Contingent Liabilities Not Provided For (If Any) (Amount in Rupees) SI. No. Particulars 31st March 2007 31st March 2006

01. Outstanding Bank Guarantee 12,53,560.00 7,00,53,560.00 02. Estimated amount of contracts 87,500.00 NIL remaining to be executed on Capital account and not provided for (Net of advances)

2. Secured Loans Nature of Security

i) For Term Loan :

The Rupee Term loan from banks are secured by way of the Security of short-term

deposit of Rs. 5,00,00,000/-. ii) The working capital loans are secured by way of the following :

First charge against all Book debts, stock and personal guarantee by directors. iii) Vehicle loans:

Vehicle loans are secured against hypothecation of respective vehicle.

3. In terms of Section 115JB of the Income Tax Act, 1961, Minimum Alternate Tax amounting to Rs. 11,48,411.00 for the year ended 31 st March 2007 has been provided in the accounts, which may be available as tax credit for set off in the future years in terms of Section 115JAA of the aforesaid Act.

4. Sundry creditors include Rs. Nrl due to Small Scale and ancillary industrial undertaking (SSI) the extent such parties have been identified from the available documents / information.

5. Excise duty on finished goods is neither provided nor the same is considered for valuation of closing stock. This has no impact on the profit for the year.

6. The balances in various accounts in sundry creditors, sundry debotrs and loans & advances are subject to confirmation and reconciliation. Company has shown the figures as per values appearing in the books of accounts.

7. Segment Information:

The Companys business activity primarily falls within a single reportable segment i.e. Chemical Products, which are subject to similar risk and returns. Hence, there is no separate segment reporting which is in conformity with the Accounting Standard-17 issued by The Institute of Chartered Accountants of India.

8. Figures of the previous year hav been regroupd / rearrange) wherever necessary.

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Mar 31, 2005

1. Estimated amount of contracts remaining to be executed on Capital Accounts and not provided for NIL (NIL)

2. Contigent Liability not provided for:- As at 31.03.2005 As at 31.03.2004

Bank Guarantees (W.B.S.E.B & Excise) 1083904.00 1623488.00

Bank Guarantees for Parasnath Coke Indust.* 30000000.00 0.00 (Joint Guarantee with Mahabir Coke Indust. P. Ltd.)

Bank Guarantees for Kamrup Coke Indust.* 20000000.00 0.00 (* Firms in which directors are interested)

3. Earnings & Expenditure in Foreign Currency :- As at 31.03.2005 As at 31.03.2004

i) GIF Value of Imports :

a) Raw Materials 3859337.00 0.00

ii) F.O.B. Value of Exports :

a) Export Sales 0.00 0.00

iii) Expenditure in Foreign Currency :

a) Rebate & Claims NIL NIL

4. Excise duty on finished goods is neither provided for nor the same is considered for valuation of closing stock. This has no impact on the profit for this year.

5. In the opinion of the Board, Current Assets, Loans and Advances have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. The balances of Sundry Debtros, Sundry Creditors and Loans and Advances are subject to confirmations.

7. Segmental Reporting :

Segment reporting as per AS-17 issued by Institute of Chartered Accountants of India is not applicable since the Company operate in one Segment for the manufacturing of Chemicals i.e. Sodium Dichromate, Sodium Sulphate, Chromic Acid Flakes and processing of Minerals i.e. Chrome Concentrate.

8. Related Party disclosure :

In accordance with Accounting Standard - 18, the disclosures required are given below :

(a) Key Management Personnel & Relatives

Mr. Ajay Kr. Jain Managing Director

Mr. Navin Jain Director

Md. Mumtaz Akhtar Khan Director

Mr. Hansraj Jain Father of Mr. Ajay Kumar Jain

Mrs. Kanta Devi Jain Mother of Mr. Ajay Kumar Jain

Mr. Sanjay Kumar Jain Elder Brother of Mr. Ajay Kumar Jain

Mrs. Meenu Jain Wife of Mr. Sanjay Kumar Jain

Mrs. Monica Jain Wife of Mr. Ajay Kumar Jain

Mrs. Chawi Jain Wife of Mr. Navin Jain

Mr. Vimal Kumar Jain Brother-in-law of Mr. Ajay Kumar Jain

Mrs. Manju Jain Sister of Mr. Ajay Kumar Jain

(b) Enterprises over which above person has significant influence :

Mahabir Coke Industries Pvt. Ltd. Common Director

SKJ Coke Industries Ltd. Common Director

Lords Securities Ltd. Common Director

Parasnath Coke Industries Relatives of Directors are Partners

Kamrup Coke Industries Relatives of Directors are Partners

Om Traders Relatives of Directors are Partners

Jupiter Coke Industries Directors are Partners

(c) Transaction with the enterprise mentioned in (b) above.

Amount (Rs.) Amount (Rs.)

Advances received 147065000.00 NIL

Loan taken 150855053.00 81529383.00

Guarantee Given 50000000.00 NIL

Sales 13793691700 NIL

(d) Transaction with parties mentioned in (a) above.

Remuneration 201000.00 246867.00

Salary 360000.00 360000.00

Office Rent 12000.00 12000.00

Loan Taken 7800000.00 2150000.00

9. Consequent to mandatory Accounting Standard issued by the ICAI on accounting for taxes on income, the Company has accumulated deferred tax assets of Rs. 5432323-00 for the year ended at 31st March, 2005.

Significant component of deferred tax Assets as shown in Balance Sheet is as below :-

Deferred Tax Assets :

Carried Forward unabsorbed depreciation 33421327.21 @ 33.66% 1124961900

Deferred Tax Liabilities :

Written down value difference :

As per Companies Act 56887784.88

As per Income Tax Act 39605264.96

17282519.92 @ 33.66% 5817296.00

Net Deferred Tax Asset 5432323.00

10. Figures in brackets represents previous years figures.

11. Previous years figures have been regrouped, rearranged and/or recasted wherever considered necessary.

12. Computation of earning per share 2004-2005 2003-2004

A. (i) No. of Equity shares in the beginning of the year 4040000 4040000

(ii) No. of Equity shares in the Closing of the year 4040000 4040000

(iii) Weighted average no. of Equity shares during the year 4040000 4040000

B. Profit after tax Rs. 299134.03 65517.64

C. Earning per share (Basic & Diluted) B/A Rs. 0.07 0.02

D. Equity Share having face value Rs.10 10

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Mar 31, 1999

1. Contingent Liability not provided for :-

As at 31-03-99 As at 31-03-98

Bank Guarantees 29,96,210.00 4,81,900.00

Excise Demand 1,20,836.00 NIL

2. Excise duty on finished goods is neither provided for nor the same is considered for valuation of closing stock, This has no impact on the profit for this year.

3. Instalments of Term Loan repayable within one year is Rs.68.00 Lakhs. (Rs. 51.00 lakhs)

4. In the opinion of the Board, current assets, loans and advances have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. The balances of Sundry Debtors, Sundry Creditors and Loans and Advances are however, subject to confirmations.

5. Figures in brackets represent previous years figure.

6. Previous years figures have been regrouped rearranged and/or recasted wherever considered necessary.

7. Additional information as required under Part IV of Schedule VI to the Companies Act, 1956 is annexed.

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Mar 31, 1998

1. The Company has started its commercial production w.e.f. 16.12.97, hence previous year's figures are not comparable with that of current year.

2. Excise duty on finished goods is neither provided for nor the same is considered for valuation of closing stock. This has no impact on the profit for this year.

3. Instalments of Term Loan repayable within one year is Rs. 51.00 lakhs (Previous Year : NIL)

4. In the opinion of the Board, current assets, loans and advances have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated. The balances of Sundry Debtors, Sundry Creditors and Loans and Advances are however, subject to confirmations.

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Mar 31, 1995

1. Estimated amount of Contract remaining to be executed on Capital Account (Net of advances Rs. 2,403,450/-) and not provided for Rs. 5,784,301.60 (Rs. 887,300/-)

2. Contingent Liabilities not provided for: NIL (NIL)

3. Additional information pursuant to the provision of Para 3 of Part II of Schedule VI to the Companies Act, 1956: NIL (NIL)

4. Advances Recoverable includes amount given to Companies under same management, maximum amount due in which case are Rs. 6,000,000/- in case of M/s. Mahabir Coke Industries Pvt. Ltd. and Rs. 8,000,000/- in case of M/s. Jupiter Iron Industries Pvt. Ltd.

5. The name of the Company was changed during the year from Lords Chemicals Private Limited to Lords Chemicals Limited w.e.f. 10th October, 1994, consequent to conversion into a Public Limited Company.

6. Income/Expenditure in Foreign Currency: NIL (NIL)

7. Additional information pursuant to the provisions of Part IV of Schedule VI to the Companies Act, 1956 is annexed forming part of Accounts.

8. Previous Year's figures have been regrouped, rearranged and recasted wherever considered necessary & figures in brackets are of Previous year.