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Notes to Accounts of Modi Naturals Ltd.
Mar 31, 2025
2.22 Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and are liable
estimate can be made of the amount of the obligation.
If the effect of the time value of money is material, provisions are discounted using a current pretax rate that reflects, when
appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of
time is recognized as a finance cost.
Contingent Liabilities are not recognized but are disclosed, while Contingent Assets are neither recognized nor disclosed, in
the financial statements.
2.23 Critical accounting estimates and judgments
In the course of applying the policies outlined above, the Company is required to make judgments, estimates and assumptions
about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results
may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision
and future period, if the revision affects current and future periods.
(i) Critical Judgments
In the process of applying the Company''s accounting policies, management has made the following judgments, which have
the most significant effect on the amounts recognised in the standalone financial statements:
Leases
The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a
lease requires significant judgment. The Company uses significant judgment in assessing the lease term (including anticipated
renewals) and the applicable discount rate.
The Company determines the lease term as the noncancellable period of a lease, together with periods covered by an option
to extend the lease if the Company is reasonably certain to exercise that option; and periods covered by an option to terminate
the lease if the Company is reasonably certain not to exercise that option. In assessing whether the Company is reasonably
certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts
and circumstances that create an economic incentive for the Company to exercise the option to extend the lease, or not to
exercise the option to terminate the lease. The Company revises the lease term if there is a change in the noncancellable
period of a lease
The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio
of leases with similar characteristics.
Impairment of financial assets
The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The
Company uses judgment in making assumption and selecting the inputs to the impairment calculation, based on Company''s
past history, existing market conditions as well as forward estimate at the end of each reporting period.
Income taxes
Management judgment is required for the calculation of provision for income taxes and deferred tax assets and liabilities. The
Company reviews at each balance sheet date the carrying amount of deferred tax assets. The amount of tax payable in respect
of any period is dependent upon the interpretation of the relevant tax rules. The factors used in estimates may differ from
actual outcome which could lead to significant adjustment to the amounts reported in the financial statements.
Defined benefit Plan
The cost of the defined benefit plan and other postemployment benefits and the present value of such obligation are
determined using actuarial valuations. A n actuarial valuation involves making various assumptions that may differ from actual
development in the future. These include the determination of the discount rate, future salary increases, mortality rates and
attrition rate. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly
sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
Insurance claims and other Miscellaneous Revenues
Insurance claims and other miscellaneous revenues are recognized when the Company has reasonable certainty of recovery.
Subsequently any change in recoverability is provided for.
Contingences and commitments
In the normal course of business, contingent liabilities may arise from litigations and other claims against the Company. Where
the potential liabilities have a low probability of crystallizing or are very difficult to quantify reliably, we treat them as contingent
liabilities. Such liabilities are disclosed in the notes but are not provided for in the standalone financial statements. Although
there can be no assurance regarding the final outcome of the legal proceedings, we do not expect them to have a materially
adverse impact on our financial position or profitability.
(ii) Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period,
that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
financial year are discussed below:
Allowances for doubtful debts
The Company makes allowances for doubtful debts based on an assessment of the recoverability of trade and other
receivables. The identification of doubtful debts requires use of judgments and estimates. Where the expectation is different
from the original estimate, such difference will impact the carrying value of the trade and other receivables and doubtful debts
expenses in the period in which such estimate has been changed.
Allowances for inventories
Management reviews the inventory age listing on a periodic basis. This review involves comparison of the carrying value of
the aged inventory items with the respective net realizable value. The purpose is to ascertain whether an allowance is required
to be made in the standalone financial statements for any obsolete and slow moving items. Management is satisfied that
adequate allowance for obsolete and slow moving inventories has been made in the standalone financial statements.
Liability for sales return
In making judgment for liability for sales return, the management considered the detailed criteria for the recognition of revenue
from the sale of goods set out in Ind AS 115 and in particular, whether the Company had transferred to the buyer the significant
risk and rewards of ownership of the goods. Following the detailed quantification of the Company''s liability towards
sales return, the management is satisfied that significant risk and rewards have been transferred and that recognition of the
revenue in the current year is appropriate, in conjunction with the recognition of an appropriate liability for sales return.
Accruals for estimated product returns, which are based on historical experience of actual sales returns and adjustment on
account of current market scenario is considered by Company to be reliable estimate of future sales returns.
Employee benefit obligations
Employee benefit obligations are determined using actuarial valuations. An actuarial valuation involves making various
assumptions that may differ from actual developments. These include the estimation of the appropriate discount rate, future
salary increases and mortality rates. Due to the complexities involved in the valuation and its longterm nature, the employee
benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
Provisions and contingencies
From time to time, the Company is subject to legal proceedings, the ultimate outcome of each being subject to uncertainties
inherent in litigation. A provision for litigation is made when it is considered probable that a payment will be made and the
amount can be reasonably estimated. Significant judgment is required when evaluating the provision including, the probability
of an unfavorable outcome and the ability to make a reasonable estimate of the amount of potential loss. Litigation provisions
are reviewed at each accounting period and revisions made for the changes in facts and circumstances. Contingent liabilities
are disclosed in the notes forming part of the standalone financial statements. Contingent assets are not disclosed in the
standalone financial statements unless an inflow of economic benefits is probable.
Deferred income tax assets and liabilities
Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based
upon the likely timing and the level of future taxable profits.
The amount of total deferred tax assets could change if management estimates of projected future taxable income or if tax
regulations undergo a change.
Impairment of Financial assets
The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortized
cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. In respect
of trade receivables, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which
requires expected lifetime losses to be recognised upon initial recognition of the receivables. For all other financial assets,
expected credit losses are measured at an amount equal to the 12 months expected credit losses or at an amount equal to
the life time expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition.
The Company reviews its carrying value of investment in subsidiaries and goodwill carried at cost (net of impairment, if any)
annually, or more frequently when there is indication for impairment. If the recoverable amount is less than its carrying amount,
the impairment loss is accounted for in the standalone statement of profit and loss.
Impairment of PPE, CWIP and intangible assets
At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment to
determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any).
Recoverable amount is the higher of fair value less costs to sell and value in use. Value in use is usually determined on the
basis of discounted estimated future cash flows. This involves management estimates on anticipated commodity prices, market
demand and supply, economic and regulatory environment, discount rates and other factors. Any subsequent changes to cash
flow due to changes in the abovementioned factors could impact the carrying value of assets.
Impairment of Inventories
Inventories are valued at lower of cost (on weighted average basis) and net realisable value after providing for obsolescence
and other losses, where considered necessary. Cost includes all charges in bringing the goods to their present location and
condition, including other levies, transit insurance and receiving charges. Work-in-progress and finished goods include
appropriate proportion of overheads and, where applicable, taxes and duties. Net realisable value is the estimated selling price
in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.
Impairment of investments in associate/subsidiaries
Determining whether the investment in associate/subsidiary is impaired requires an estimate in the value in use of investment.
In considering the value in use, the management has anticipated future business orders, operating margins and other factors
of the underlying businesses / operations of the investee company. Any subsequent changes to the cash flows due to changes
in the abovementioned factors could impact the carrying value of investment.
As per our report of even date attached
for Doogar &Associates
Chartered Accountants
FRNo.00561N for and on behalf of the Board
Sd/-
Sd/- Anil Modi DIN:00187078 Chairman & Managing Director
(Mukesh Goyal) Akshay Modi DIN:03341142 Jt. Managing Director
Partner Pradeep Kapoor PAN:ATEPK2474R Chief Financial Officer
M No.: 081810 Rajan Kumar Singh M.No.:A42105 Company Secretary
Mar 31, 2024
2.22 Provisions, Contingent Liabilities and Contingent Assets
Provisions are recognized when the company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and are liable estimate can be made of the amount of the obligation.
If the effect of the time value of money is material, provisions are discounted using a current pretax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.
Contingent Liabilities are not recognized but are disclosed, while Contingent Assets are neither recognized nor disclosed, in the financial statements.
2.23 Critical accounting estimates and judgments
In the course of applying the policies outlined above, the Company is required to make judgments, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future period, if the revision affects current and future periods.
i. Critical Judgments
In the process of applying the Company''s accounting policies, management has made the following judgments, which have the most significant effect on the amounts recognised in the standalone financial statements:
Leases
The Company evaluates if an arrangement qualifies to be a lease as per the requirements of Ind AS 116. Identification of a lease requires significant judgment. The Company uses significant judgment in assessing the lease term (including anticipated renewals) and the applicable discount rate.
The Company determines the lease term as the noncancellable period of a lease, together with periods covered by an option to extend the lease if the Company is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the Company is reasonably certain not to exercise that option. In assessing whether the Company is reasonably certain to exercise an option to extend a lease, or not to exercise an option to terminate a lease, it considers all relevant facts and circumstances that create an economic incentive for the Company to exercise the option to extend the lease, or not to exercise the option to terminate the lease. The Company revises the lease term if there is a change in the noncancellable period of a lease
The discount rate is generally based on the incremental borrowing rate specific to the lease being evaluated or for a portfolio of leases with similar characteristics.
Impairment of financial assets
The impairment provisions for financial assets are based on assumptions about risk of default and expected loss rates. The Company uses judgment in making assumption and selecting the inputs to the impairment calculation, based on Companyâs past history, existing market conditions as well as forward estimate at the end of each reporting period.
Income taxes
Management judgment is required for the calculation of provision for income taxes and deferred tax assets and liabilities. The Company reviews at each balance sheet date the carrying amount of deferred tax assets. The amount of tax payable in respect of any period is dependent upon the interpretation of the relevant tax rules. The factors used in estimates may differ from actual outcome which could lead to significant adjustment to the amounts reported in the financial statements.
Defined benefit Plan
The cost of the defined benefit plan and other postemployment benefits and the present value of such obligation are determined using actuarial valuations. A n actuarial valuation involves making various assumptions that may differ from actual development in the future. These include the determination of the discount rate, future salary increases, mortality rates and attrition rate. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
Insurance claims and other Miscellaneous Revenues
Insurance claims and other miscellaneous revenues are recognized when the Company has reasonable certainty of recovery. Subsequently any change in recoverability is provided for.
Contingences and commitments
In the normal course of business, contingent liabilities may arise from litigations and other claims against the Company. Where the potential liabilities have a low probability of crystallizing or are very difficult to quantify reliably, we treat them as contingent liabilities. Such liabilities are disclosed in the notes but are not provided for in the standalone financial statements. Although there can be no assurance regarding the final outcome of the legal proceedings, we do not expect them to have a materially adverse impact on our financial position or profitability.
ii. Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:
Allowances for doubtful debts
The Company makes allowances for doubtful debts based on an assessment of the recoverability of trade and other receivables. The identification of doubtful debts requires use of judgments and estimates. Where the expectation is different from the original estimate, such difference will impact the carrying value of the trade and other receivables and doubtful debts expenses in the period in which such estimate has been changed.
Allowances for inventories
Management reviews the inventory age listing on a periodic basis. This review involves comparison of the carrying value of the aged inventory items with the respective net realizable value. The purpose is to ascertain whether an allowance is required to be made in the standalone financial statements for any obsolete and slow moving items. Management is satisfied that adequate allowance for obsolete and slow moving inventories has been made in the standalone financial statements.
Liability for sales return
In making judgment for liability for sales return, the management considered the detailed criteria for the recognition of revenue from the sale of goods set out in Ind AS 115 and in particular, whether the Company had transferred to the buyer the significant risk and rewards of ownership of the goods. Following the detailed quantification of the Company''s liability towards sales return, the management is satisfied that significant risk and rewards have been transferred and that recognition of the revenue in the current year is appropriate, in conjunction with the recognition of an appropriate liability for sales return.
Accruals for estimated product returns, which are based on historical experience of actual sales returns and adjustment on account of current market scenario is considered by Company to be reliable estimate of future sales returns.
Employee benefit obligations
Employee benefit obligations are determined using actuarial valuations. An actuarial valuation involves making various assumptions that may differ from actual developments. These include the estimation of the appropriate discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, the employee benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date.
Provisions and contingencies
From time to time, the Company is subject to legal proceedings, the ultimate outcome of each being subject to uncertainties inherent in litigation. A provision for litigation is made when it is considered probable that a payment will be made and the amount can be reasonably estimated.
Significant judgment is required when evaluating the provision including, the probability of an unfavorable outcome and the ability to make a reasonable estimate of the amount of potential loss. Litigation provisions are reviewed at each accounting period and revisions made for the changes in facts and circumstances. Contingent liabilities are disclosed in the notes forming part of the standalone financial statements. Contingent assets are not disclosed in the standalone financial statements unless an inflow of economic benefits is probable.
Deferred income tax assets and liabilities
Significant management judgment is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits.
The amount of total deferred tax assets could change if management estimates of projected future taxable income or if tax regulations undergo a change.
Impairment of Financial assets
The Company assesses on a forward looking basis the expected credit losses associated with its assets carried at amortized cost. The impairment methodology applied depends on whether there has been a significant increase in credit risk. In respect of trade receivables, the Company applies the simplified approach permitted by Ind AS 109 Financial Instruments, which requires expected lifetime losses to be recognised upon initial recognition of the receivables. For all other financial assets, expected credit losses are measured at an amount equal to the 12 months expected credit losses or at an amount equal to the life time expected credit losses if the credit risk on the financial asset has increased significantly since initial recognition.
The Company reviews its carrying value of investment in subsidiaries and goodwill carried at cost (net of impairment, if any) annually, or more frequently when there is indication for impairment. If the recoverable amount is less than its carrying amount, the impairment loss is accounted for in the standalone statement of profit and loss.
Impairment of PPE, CWIP and intangible assets
At the end of each reporting period, the Company reviews the carrying amounts of its property, plant and equipment to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss if (any)
Recoverable amount is the higher of fair value less costs to sell and value in use. Value in use is usually determined on the basis of discounted estimated future cash flows. This involves management estimates on anticipated commodity prices, market demand and supply, economic and regulatory environment, discount rates and other factors. Any subsequent changes to cash flow due to changes in the abovementioned factors could impact the carrying value of assets.
Impairment of Inventories
Inventories are valued at lower of cost (on weighted average basis) and net realisable value after providing for obsolescence and other losses, where considered necessary. Cost includes all charges in bringing the goods to their present location and condition, including other levies, transit insurance and receiving charges. Work-in-progress and finished goods include appropriate proportion of overheads and, where applicable, taxes and duties. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and the estimated costs necessary to make the sale.
Impairment of investments in associate/subsidiaries
Determining whether the investment in associate/subsidiary is impaired requires an estimate in the value in use of investment. In considering the value in use, the management has anticipated future business orders, operating margins and other factors of the underlying businesses / operations of the investee company. Any subsequent changes to the cash flows due to changes in the abovementioned factors could impact the carrying value of investment.
Estimation of uncertainties relating to the global health pandemic from COVID19:
The COVID19 pandemic is an evolving human tragedy declared a global pandemic by the World Health Organisation with adverse impact on economy and business. Supply Chain disruptions in India as a result of the outbreak started with restrictions on movement of goods, closure of borders etc.
In light of these circumstances, the Company has considered the possible effects that may result from COVID19 on the carrying amounts of financials assets, inventory, receivables, property plant and equipment, Intangibles etc., as well as liabilities accrued. In developing the assumptions relating to the possible future uncertainties in the economic conditions because of this pandemic, the Company has used internal and external information such as our current contract terms, financial strength of partners, investment profile, future volume estimates from the business etc.
See accompanying notes to Ind AS Financial Statements 1 - 44
As per our report of even date attached
for Doogar & Associates New Delhi, 30th May 2024
Chartered Accountants FRNo. 00561N
for and on behalf of the Board
Sd/-
Sd/- Anil Modi DIN:00187078 Chairman & Managing Director
(Mukesh Goyal) Akshay Modi DIN:03341142 Jt. Managing Director
MaNr r08i8i0 Pradeep Kapoor PAN:ATEPK2474R Chief Financial Officer
M N°.'' 081810 A"kit A3arwal M.Mo.:A23445. Company Secretary
Based on legal advice, discussions with the solicitors, etc., the management believes that there is fair chance of decisions in the company''s favour in respect of all the items listed at (i) to (vii) above and hence no provision is considered necessary against the same. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the company''s financial position and results of operations.
32. On May 18, 2022, the Board of Directors of the Company had, pursuant to special resolution passed by the Members at its extraordinary general meeting held on May 04, 2022 in terms of SEBI (ICDR) Regulations, 2018, allotted 6,50,000 convertible warrants carrying a right exercisable by the warrant holder to subscribe to one fully paid up equity share per warrant at a price of ?207/ (âIssue Priceâ) [including premium of Rs. 197/] per equity share on preferential basis to promoter category. The Warrants may be converted into equivalent number of fully paid up equity shares on payment of balance amount at any time, not exceeding 18 (eighteen) months from the date of allotment of such warrants.
During the current year, upon request from the holders of aforesaid Warrants, the Board in its meeting held on 20.10.2023, 30.10.2023 and 17.11.2023 approved the conversion of 650000 warrants into equivalent number of fully paid-up Equity Shares of face value of Rs. 10/- each as under:
33. The Company incorporated a wholly owned subsidiary Modi Biotech Private Limited in the State of National Capital Territory of Delhi, on April 27, 2021. In line with the Ethanol Blended Petrol (EBP) program, the Company has diversified into ethanol manufacturing, with a state-of-the art greenfield Ethanol Plant being established in the state of Chhattisgarh under its wholly owned subsidiary Modi Biotech Private Limited (MBPL). MBPL has received in-principle approval for a 210 KLD distillery for the manufacture of ethanol from the Central Government, along with signing an MOU with the Chhattisgarh Government for the same. The company has also received environment clearance (EC) for the project from the Ministry of Environment, Forest and Climate change (MoEF & CC). The Company has invested in its wholly owned subsidiary Rs. 35,00,00,000/- (Previous Year : Rs. 27,00,00,000/-) by way of 1,75,00,000 (Previous Year 90,00,000) fully paid-up equity shares having a face value of Rs.10/- each aggregating Rs. 17,50,00,000/- (Previous Year : Rs. 9,00,00,000/-) and 17,50,000 (Previous Year : 18,00,000) fully paid up optionally convertible debentures having face value of Rs. 100/- each aggregating Rs 17,50,00,000/- (Previous Year: Rs. 18,00,00,000/-).
34. There was a fire in the Vegetable Oil Refinery in December 2021, resulting in complete closure of the plant for 13 days and thereafter running on reduced capacity for about one month. The company had filed an insurance claim for the losses sustained and the claim is still under process. The Company has adjusted the loss incurred on stock against the insurance claim filed. The loss incurred on fixed asset has been adjusted to the extent of written down value of the asset. The actual profit /loss due to fire would be adjusted at the time of settlement of the claim.
35. Employee Benefits
A Defined Benefit plans
Gratuity Recognised in financial statements as per Actuarial Valuations as on March 31, 2023
Sensitivities due to mortality and withdrawals are not material & hence impact of change not calculated.
Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump sum benefit on retirement.
The estimates of future salary increase considered in actuarial valuation, take account of inflation, seniority, promotion, and other relevant factors. The above information is certified by the actuary and relied upon by the auditors.
The employer''s best estimate of contribution expected to be paid during the next year is Rs. 55.55 lakhs.
B. Defined Benefit plans - Leave Encashment
Liability in respect of leave encashment is not applicable since the company pays leave encashment to employees every year.
C. Defined Contribution plans - Provident Fund and ESI
The Company has recognized Rs. 103.99 lakhs (As on 31 March,2023: Rs. 103.33 lakhs) in statement of profit and loss as Companyâs contribution to provident fund and ESI.
36. RELATED PARTY DISCLOSURE
I.Names of the related parties with whom transactions have taken place during the year:
A. Key Management Personnel
Mr. Anil Modi, Managing Director
Mr. Akshay Modi, Joint Managing Director
B. Relatives of Key Management Personnel.
Mrs. Nita Modi Mrs. Aditi Gupta Mrs. Neha Agarwal
C. Subsidiary.
Modi Biotech Private Limited
D. Enterprises over which key Management personnel, or his relative, has significant influence. NA
Note: Related parties are as identified by the company and relied upon by the Auditors.
Valuation techniques used to determine fair value
Fair value of cash and cash equivalents, loans and advances, receivables, payables, and other current financial assets and liabilities measured at amortized cost is approximate to their carrying amounts largely due to the shortterm maturities of these instruments. The fair value of other noncurrent financial assets (Loans and advances) carried at amortized cost is approximately equal to fair value. Hence carrying value and fair value is taken same.
B. Financial risk management
The Companyâs Board of Directors has overall responsibility for the establishment and oversight of the Companyâs risk management framework. The Board of directors is responsible for developing and monitoring the Companyâs risk management policies.
The Companyâs risk management policies are established to identify and analyze the risk faced by the Company, to set appropriate risks limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in the market condition and Companyâs Activities.
The Company''s Board of Directors oversee how management monitors compliances with the companyâs risk management policies and procedures and reviews the adequacy of the risk management framework in relation to risks faced by the Company.
Financial risk factors
The Companyâs activities expose it to a variety of financial risks which includes market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
The Companyâs focus is to ensure liquidity which is sufficient to meet the Companyâs operational requirements. The Company monitors and manages key financial risks so as to minimize potential adverse effects on its financial performance. The Company has a risk management policy which covers the risks associated with the financial assets and liabilities. The details for managing each of these risks are summarized ahead.
i. Market Risk:
Market risk is the risk that the expected cash flows or fair value of a financial instrument could change owing to changes in market prices. The Companyâs activities expose it primarily to the financial risks of changes in foreign currency exchange rates, interest rates and commodity prices. The objective of the market risk management is to manage and control market risk exposure within acceptable parameters, while optimizing the returns.
(ii) Credit risk management
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Companyâs exposure to credit risk primary arises from trade receivables, which are typically unsecured. A part from this, the Company is exposed to credit risk from its financing activities including deposit with banks and security deposits.
The credit risk on bank balances is limited because the counter parties are banks with good credit ratings.
Financial assets are written off when there is no reasonable expectation of recovery. Where the loans and receivables were written off and subsequently recoveries are made, these are recognised as an income in the financial statements.
Trade Receivables
Credit risk is managed through credit approvals, establishing credit limits, continuous monitoring of creditworthiness of customers to which the company grants credit terms in the normal course of business. The Company also assesses the financial reliability of customers taking into account the financial condition, current economic trends and historical bad debts and ageing of accounts receivables.
Cash & Cash Equivalents
With respect to credit risk arising from financial assets which comprise of cash and cash equivalents, the Company s risk exposure arises from the default of the counter party, with a maximum exposure equal to the carrying amount of these financial assets at the reporting date. Since the counter party involved is a bank, Company considers the risks of nonperformance by the counter party as nonmaterial.
iii) 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. The Companyâs treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Companyâs net liquidity position through rolling forecasts on the basis of expected cash flows.
Maturity profile of financial liabilities
The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.
38. Capital Management
The company manages its capital to ensure that it will be able to continue as going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the company consists of net debt and total equity.
The company determines the amount of capital required on the basis of annual as well as long term operating plans and other strategic investment plans. The funding requirements are met through longterm /shortterm borrowings. The company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio.
In order to achieve this overall objective, the Group''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to call loans and borrowings or charge some penal interest. There have been no breaches in the financial covenants of any interest bearing loans and borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the current years and previous year.
39. Operating Segment
In accordance with the Indian Accounting Standard -Ind AS 108 ''Operating Segment, the Company has organised the business into two segments viz. Branded Business and Bulk Business. The Branded business includes consumer oil and food business. The Bulk business includes bulk oil business. Summarised segment information for the years ended March 31, 2024 and 2023, is as follows:
43. Additional Regulatory Information as required by Schedule III of Companies Act, 2013
a. There are no proceedings which have been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988.
b. Title deeds of immovable properties are held in the name of the company.
c. The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
d. The Company has not been declared willful defaulter by any bank or financial institution or government or any government authority.
e. The company has used the borrowings from banks and financial institutions for the purpose for which it was taken at the balance sheet date.
f. There are no transactions not recorded in the books of accounts that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
g. There are no Loans or Advances in the nature of Loans granted to promoters, directors, KMPs and the related parties, either severally or jointly with any other person, that are repayable on demand or without specifying any terms or period of repayment.
h. The company has borrowings from bank on the basis of security of current assets, and quarterly returns or statements of current assets filed by the Company with banks or financial institutions are generally in agreement with the books of accounts.
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.
j. 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.
k. The Company does not have any transactions with companies struck off.The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
l. The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year
m. The Company has complied with the number of layers for its holdings in downstream companies prescribed under clause 87 of section 1 of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017.
44. Approval of financial statements
The financial statements for the year ended 31st March 2024 were approved by the Board of Directors and authorize for issue on 30th May 2024.
As per our report of even date attached
See accompanying notes to Ind AS Financial Statements 1 - 44
As per our report of even date attached for Doogar & Associates Chartered Accountants FRNo. 00561N
for and on behalf of the Board
Sd/-
Sd/- Anil Modi DIN:00187078 Chairman & Managing Director
(Mukesh G°yal) Akshay Modi DIN:03341142 Jt. Managing Director
Partner Pradeep Kapoor PAN:ATEPK2474R Chief Financial Officer
M No.: 081810 Ankit Agarwal M.No.:A23445. Company Secretary
Mar 31, 2023
Notes:
(i) 5,00,000 (previous Year 5,00,000) Zero Interest Unsecured Optionally Convertible Debentures (Series A) of Rs.100/- each convertible into Equity Shares of Rs.10/- each fully paid up in one or more tranches or in full at the option of Debenture Holders (Modi Naturals Limited) anytime after one year from the date of allotment(s) but within 31st March, 2041 at the Net Asset Value per equity share as on the date of conversion to be determined on the basis of valuation report of a registered valuer, or redeemable at the option of the Board of Directors of the Modi Biotech Private Limited at par or premium as may be mutually decided by the Modi Biotech Private Limited and the debenture holders (Modi Naturals Limited) anytime after one year from the date of allotment(s) but within 31st March, 2041
(ii) 5,00,000 (previous Year 5,00,000) Zero Interest Unsecured Optionally Convertible Debentures (Series B) of Rs.100/- each convertible into Equity Shares of Rs.10/- each fully paid up in one or more tranches or in full at the option of Debenture Holders anytime after one year from the date of allotment(s) but within 31st March, 2041 at the Net Asset Value per equity share as on the date of conversion to be determined on the basis of valuation report of a registered valuer, or redeemable at the option of the Board of Directors of the company at par or premium as may be mutually decided by the company and the debenture holders anytime after one year from the date of allotment(s) but within 31st March, 2041.
(iii) 8,00,000 (previous Year 3,00,000) Zero Interest Unsecured Optionally Convertible Debentures (Series C) of Rs.100/- each convertible into Equity Shares of Rs.10/- each fully paid up in one or more tranches or in full at the option of Debenture Holders (Modi Naturals Limited) anytime after one year from the date of allotment(s) but within 31st March, 2041 at the Net Asset Value per equity share as on the date of conversion to be determined on the basis of valuation report of a registered valuer, or redeemable at the option of the Board of Directors of the Modi Biotech Private Limited at par or premium as may be mutually decided by the Modi Biotech Private Limited and the debenture holders (Modi Naturals Limited) anytime after one year from the date of allotment but within 31st March, 2041
11.2 The company has only one class of equity shares, having a par value of Rs.10 per share. Accordingly, all equity shares rank equally with regard to dividends and share in the Company'' s residual assets. Each shareholder is eligible to one vote per share held. The dividend proposed, if any, by the Board of Directors is subject to approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. The repayment of equity share capital in the event of liquidation and buy back of shares are possible subject to prevalent regulations. In the event of liquidation, normally the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.
11.5 Issued, subscribed and paid-up capital of the company includes:-
(i) 4238967 shares (Previous Year 4238967) allotted as Bonus Shares by way of Capitalisation of Profits
(ii) 2640000 Shares (Previous Year 2640000) issued by way of conversion of Optionally Convertible Warrants into equity shares Rs.10/- each at a premium of Rs.20/- each.
(iii) 1538463 Shares (Previous Year 1538463) issued by way of conversion of Optionally Convertible Warrants into equity shares Rs.10/- each at a premium of Rs.120/- each.
13.1 Term Loan from banks is secured by way of equitable mortgage of Factory Land & Building and Hypothecation of Plant & Machinery of all the units at Bisalpur Road and Bareilly Road, Stock and Book Debts, Personal guarantees of Mr. Anil Modi, Mrs. Nita Modi and Mr. Akshay Modi
13.2 Working Capital facility comprises cash credit from bank and is secured against hypothecation of raw materials, semi -finished goods, finished goods, consumable stores, book debts of units at Bisalpur Road and Bareilly Road, Pilibhit and personal guarantees of Mr. Anil Modi and Mr Akshay Modi.
13.3 Vehicle Loans are secured against hypothecation of respective Vehicles
Based on legal advice, discussions with the solicitors, etc., the management believes that there is fair chance of decisions in the company''s favour in respect of all the items listed at (i) to (vi) above and hence no provision is considered necessary against the same. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the company''s financial position and results of operations.
32. On May 18, 2022, the Board of Directors of the Company has, pursuant to special resolution passed by the Members at its extraordinary general meeting held on May 04, 2022 in terms of SEBI (ICDR) Regulations, 2018, allotted 6,50,000 convertible warrants carrying a right exercisable by the warrant holder to subscribe to one fully paid up equity share per warrant at a price of ?207/ (âIssue Priceâ) [including premium of Rs. 197/] per equity share on preferential basis to promoter category as under:
The amount equivalent to 25% of the warrant issue price was received upfront and balance 75% is payable by the Warrant Holder at the time of allotment of the Equity Share which may be exercised at any time on or before expiry of 18 months from the date of allotment of Warrants, failing which the warrants shall lapse and the amount paid shall stand forfeited by the Company.
33. During the previous year, the Company incorporated a wholly owned subsidiary Modi Biotech Private Limited in the State of National Capital Territory of Delhi, on April 27, 2021. In line with the Ethanol Blended Petrol (EBP) program, the Company has diversified into ethanol manufacturing, with a state of the art greenfield Ethanol Plant being established in the state of Chhattisgarh under its wholly owned subsidiary Modi Biotech Private Limited (MBPL). MBPL has received in principle approval for a 210 KLD distillery for the manufacture of ethanol from the Central Government, along with signing an MOU with the Chhattisgarh Government for the same. The company has also received environment clearance (EC) for the project from the Ministry of Environment, Forest and Climate change (MoEF & CC). The Company has invested in its wholly owned subsidiary Rs. 27,00,00,000/ (Previous Year : Rs. 15,00,00,000/) by way of 90,00,000 (Previous Year 20,00,000) fully paid up equity shares having a face value of Rs.10/ each aggregating Rs. 9,00,00,000/ (Previous Year : Rs. 2,00,00,000/) and 18,00,000 (Previous Year : 13,00,000) fully paid up optionally convertible debentures having face value of Rs. 100/ each aggregating Rs 18,00,00,000/ (Previous Year: Rs. 13,00,00,000/).
34. There was a fire in the Vegetable Oil Refinery in December 2021, resulting in complete closure of the plant for 13 days and thereafter running on reduced capacity for about one month. The company had filed an insurance claim for the losses sustained and the claim is still under process. The Company has adjusted the loss incurred on stock against the insurance claim filed. The loss incurred on fixed asset has been adjusted to the extent of written down value of the asset. The actual profit /loss due to fire would be adjusted at the time of settlement of the claim.
Sensitivities due to mortality and withdrawals are not material & hence impact of change not calculated.
Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump sum benefit on retirement.
The estimates of future salary increase considered in actuarial valuation, take account of inflation, seniority, promotion, and other relevant factors. The above information is certified by the actuary and relied upon by the auditors.
The employer''s best estimate of contribution expected to be paid during the next year is Rs. 53.52 lakhs.
B. Defined Benefit plans - Leave Encashment
Liability in respect of leave encashment is not applicable since the company pays leave encashment to employees every year.
C. Defined Contribution plans - Provident Fund and ESI
The Company has recognized Rs. 103.33 lakhs (As on 31 March, 2022: Rs. 95.70 lakhs) in statement of profit and loss as Company''s contribution to provident fund and ESI.
1. Names of the related parties with whom transactions have taken place during the year:
Mr. Anil Modi, Managing Director
Mr. Akshay Modi, Joint Managing Director
(B) Relatives of Key Management Personnel.
Mrs. Nita Modi Mrs. Aditi Gupta Mrs. Neha Agarwal
Modi Biotech Private Limited
(D) Enterprises over which key Management personnel, or his relative, has significant influence. NA
Note: Related parties are as identified by the company and relied upon by the Auditors.
Valuation techniques used to determine fair value
Fair value of cash and cash equivalents, loans and advances, receivables, payables, and other current financial assets and liabilities measured at amortized cost is approximate to their carrying amounts largely due to the shortterm maturities of these instruments. The fair value of other noncurrent financial assets (Loans and advances) carried at amortized cost is approximately equal to fair value. Hence carrying value and fair value is taken same.
The Company''s Board of Directors has overall responsibility for the establishment and oversight of the Company''s risk management framework. The Board of directors is responsible for developing and monitoring the Company''s risk management policies.
The Company''s risk management policies are established to identify and analyze the risk faced by the Company, to set appropriate risks limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in the market condition and Company''s Activities.
The Companyâs Board of Directors oversee how management monitors compliances with the company''s risk management policies and procedures and reviews the adequacy of the risk management framework in relation to risks faced by the Company.
The Company''s activities expose it to a variety of financial risks which includes market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
The Company''s focus is to ensure liquidity which is sufficient to meet the Company''s operational requirements. The Company monitors and manages key financial risks so as to minimize potential adverse effects on its financial performance. The Company has a risk management policy which covers the risks associated with the financial assets and liabilities. The details for managing each of these risks are summarized ahead.
Market risk is the risk that the expected cash flows or fair value of a financial instrument could change owing to changes in market prices. The Company''s activities expose it primarily to the financial risks of changes in foreign currency exchange rates, interest rates and commodity prices. The objective of the market risk management is to manage and control market risk exposure within acceptable parameters, while optimizing the returns.
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Company''s exposure to credit risk primary arises from trade receivables, which are typically unsecured. A part from this, the Company is exposed to credit risk from its financing activities including deposit with banks and security deposits.
The credit risk on bank balances is limited because the counter parties are banks with good credit ratings.
Financial assets are written off when there is no reasonable expectation of recovery. Where the loans and receivables were written off and subsequently recoveries are made, these are recognised as an income in the financial statements.
Credit risk is managed through credit approvals, establishing credit limits, continuous monitoring of creditworthiness of customers to which the company grants credit terms in the normal course of business. The Company also assesses the financial reliability of customers taking into account the financial condition, current economic trends and historical bad debts and ageing of accounts receivables.
With respect to credit risk arising from financial assets which comprise of cash and cash equivalents, the Company s risk exposure arises from the default of the counter party, with a maximum exposure equal to the carrying amount of these financial assets at the reporting date. Since the counter party involved is a bank, Company considers the risks of nonperformance by the counter party as nonmaterial.
For financial assets (other than trade receivables), expected credit losses are measured at an amount equal to the 12month ECI, unless there has been a significant increase in credit risk from initial recognition in which case those are measured at lifetime ECI. The Company does not have any expected credit loss on financial assets which are measured on 12 month ECI and also has not observed any significant increase in credit risk since initial recognition of the financial assets.
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. The Company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.
Maturity profile of financial liabilities
The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.
The company manages its capital to ensure that it will be able to continue as going concern while maximizing the return to stakeholders through the optimization of the debt and equity balance. The capital structure of the company consists of net debt and total equity.
The company determines the amount of capital required on the basis of annual as well as long term operating plans and other strategic investment plans. The funding requirements are met through longterm /shortterm borrowings. The company monitors the capital structure on the basis of total debt to equity ratio and maturity profile of the overall debt portfolio.
In order to achieve this overall objective, the Group''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to call loans and borrowings or charge some penal interest. There have been no breaches in the financial covenants of any interest bearing loans and borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the current years and previous year.
The company''s sole business segment is manufacturing and marketing of Oils & Deoiled Cakes and the geographical segment is India. Consequently, no separate disclosure, as required under Indian Accounting Standard 108 - Operating Segment, is considered relevant.
Explanation for variance exceeding 25%:
i. Debt Service ratio has decreased as the liability to pay long term borrowings is increased in current year.
ii. Return on Equity Ratio has decreased due to decrease in profits.
iii. Trade payables turnover ratio has decreased due to increase in average trade payables.
iv. Net Profit ratio has decreased due to decrease in profits.
v. Return on Capital employed ratio has decreased due to decrease in earnings and increase in shareholders'' equity.
43. Additional Regulatory Information as required by Schedule III of Companies Act, 2013
(a) There are no proceedings which have been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988.
(b) Title deeds of immovable properties are held in the name of the company.
(c) The Company does not have any charges or satisfaction which is yet to be registered with ROC beyond the statutory period.
(d) The Company has not been declared willful defaulter by any bank or financial institution or government or any government authority.
(e) The company has used the borrowings from banks and financial institutions for the purpose for which it was taken at the balance sheet date.
(f) There are no transactions not recorded in the books of accounts that have been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
(g) There are no Loans or Advances in the nature of Loans granted to promoters, directors, KMPs and the related parties, either severally or jointly with any other person, that are repayable on demand or without specifying any terms or period of repayment.
(h) The Company has been sanctioned working capital limits in excess of five crore rupees, in aggregate, from banks on the basis of security of current assets. The quarterly returns or statements filed by the Company with such banks for the quarter ended as on 31.12.2022 and 31.03.2023 are not in agreement with the books of account of the Company. Reconciliation and reason for the same as follows:
(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.
(j) 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.
(k) The Company does not have any transactions with companies struck off.
(l) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.
(m) The Company has complied with the number of layers for its holdings in downstream companies prescribed under clause 87 of section 1 of the Companies Act, 2013 read with Companies (Restriction on number of Layers) Rules, 2017.
44. Approval of financial statements
The financial statements for the year ended 31st March 2023 were approved by the Board of Directors and authorize for issue on 30th May 2023.
Mar 31, 2018
Note :1. Basic of Preparation of Financial Statement
i.) Statement of compliance with Ind AS
In accordance with the notification issued by the Ministry of Corporate Affairs, the Company, with effect from 1 April 2017, has adopted Indian Accounting Standards (the ''Ind AS'') notified under the Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 as amended by Companies (Indian Accounting Standards) (Amended) Rules, 2016 and other relevant provisions of the Act. The financial statements up to the Year ended 31stMarch, 2017 were prepared in accordance with the Accounting Standards specified under Section 133 of the Companies Act, 2013, read with Rule 7 of the Companies (Accounts) Rules, 2014 and other provisions of the Act. (Referred to as ''Indian GAAP'').
These financial statements are the first financial statements of the Company under Ind AS. The date of transition to Ind AS is 1st April, 2017 The company has adopted all the Ind AS and the adoption was carried out in accordance with Ind AS 101 - First time adoption of Indian Accounting Standards. The transition was carried out from accounting principles generally accepted in India as prescribed under Section 133 of the Act, read with Rule 7 of the Companies (Accounts) Rules, 2014 (IGAAP), which was the previous GAAP. Reconciliations and description of the effects of the transition have been summarized in Note 42. The details of the first time adoption exemptions availed by the Company are given in Note 42 series.
Accounting policies have been consistently applied except where a newly issued accounting standard is initially adopted or a revision to an existing accounting standard requires a change in the accounting policy hitherto in use.
ii.) Functional and Presentation Currency
The financial statements are presented in Indian Rupees, which is the functional currency of the Company and the currency of the primary economic environment in which the Company operates. All values are in Rupees except when otherwise indicated
iii.) Historical Cost Convention
The financial statements are prepared on accrual basis of accounting under historical cost convention in accordance with generally accepted accounting principles in India and the relevant provisions of the Companies Act, 2013 including Indian Accounting Standards notified there under, except for certain financial instruments which are measured at fair values at the end of each reporting period, as explained in the accounting policies below. Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.
a. Defined benefit plan-plan assets measured at fair value.
b. Certain financial assets and liabilities.
c. Assets held for sale measured at the lower its carrying amount and fair value less cost to sell.
Note 1.2 First-time adoption optional exemptions Overall principle
The Company has prepared the opening balance sheet as per Ind AS as of 1 April, 2016 (the transition date) by recognizing all assets and liabilities whose recognition is required by Ind AS, not recognizing items of assets or liabilities which are not permitted by Ind AS, by reclassifying items from previous GAAP to Ind AS as required under Ind AS, and applying Ind AS in measurement of recognized assets and liabilities. However, this principle is subject to the certain exception and certain optional exemptions regarding retrospective application, availed by the Company as detailed below.
1.3 The company has only one class of equity shares, having a par value of Rs.10 per share. Accordingly, all equity shares rank equally with regard to dividends and share in the Company'' s residual assets. Each shareholder is eligible to one vote per share held. The dividend proposed, if any, by the Board of Directors is subject to approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. The repayment of equity share capital in the event of liquidation and buy back of shares are possible subject to prevalent regulations. In the event of liquidation, normally the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.
1.4 Issued, subscribed and paid-up capital of the company includes:-
(i) 4238967 shares (Previous Year 4238967) alloted as Bonus Shares by way of Capitalisation of Profits
(ii) 2640000 Shares (Previous Year 2640000) issued by way of conversion of Optionally Convertible Warrants into equity shares Rs.10/- each at a premium of Rs.20/- each.
2.1 Term Loan from banks is secured by way of equitable mortgage of Factory Land & Building and Hypothecation of Plant & Machinery of all the units at Bisalpur Road and Bareilly Road, Stock and Book Debts, Personal guarantees of Mr. Anil Modi, Mrs. Nita Modi and Mr. Akshay Modi
2.2 Working Capital facility comprises cash credit from bank and is secured against hypothecation of raw materials, semi finished goods, finished goods, consumable stores, book debts, all securities of units at Bisalpur Road and Bareilly Road, Pilibhit and personal guarantees of Mr. Anil Modi, Mrs. Nita Modi and Mr Akshay Modi.
2.3 Vehicle Loans are secured against hypothecation of respective Vehicles
14.1 Based on the information so far obtained by the Company, payment to enterprises covered under the Micro, Small and Medium Enterprises Development Act, 2006 (MSMED Act) has been made within 45 days and disclosure in accordance with section 22 of the MSMED Act is as under:
Principal amount remaining unpaid Principal amount remaining unpaid above 45 days Interest due on above Total of above
Interest paid in terms of section 16
Interest due and payable for the period of delay in payment
Interest accrued and remaining unpaid
Interest due and payable even in succeeding years
Based on legal advice, discussions with the solicitors, etc., the management believes that there is fair chance of decisions in the company''s favour in respect of all the items listed at (i) to (iv) above and hence no provision is considered necessary against the same. The management believes that the ultimate outcome of these proceedings will not have a material adverse effect on the company''s financial position and results of operations.
Sensitivities due to mortality and withdrawals are not material & hence impact of change not calculated.
Sensitivities as to rate of inflation, rate of increase of pensions in payment, rate of increase of pensions before retirement & life expectancy are not applicable being a lump sum benefit on retirement.
The estimates of future salary increase considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors. The above information is certified by the actuary and relied upon by the auditors.
The employer''s best estimate of contribution expected to be paid during the next year is Rs. 41,52,334.00.
B Defined Benefit plans - Leave Encashment
Liability in respect of leave encashment is not applicable since the company pays leave encashment to employees every year.
C Defined Contribution plans - Provident Fund and ESI
The Company has recognized Rs. 77,37,596 (As on 31 March,2017: Rs. 77,59,349) in statement of profit and loss as Company''s contribution to provident fund and ESI.
Note 3: Financial Instruments Capital Management
The Company manages its capital to ensure that the entities in the Company will be able to continue as going concern while maximizing the return to shareholders and also complying with the ratios stipulated in the loan agreements through the optimization of the debt and equity balance.
The capital structure of the Company consists of net debt (borrowings as detailed in note 13 offset by cash and bank balances as detailed in note 7 & 10) and total equity of the Company.
The Company is not subject to any externally imposed capital requirements.
Note:
i. Debt is defined as long and short-term borrowings (excluding derivative, financial guarantee contracts), as described in note 13.
ii. In order to achieve this overall objective, the Group''s capital management, amongst other things, aims to ensure that it meets financial covenants attached to the interest-bearing loans and borrowings that define capital structure requirements. Breaches in meeting the financial covenants would permit the bank to call loans and borrowings or charge some penal interest. There have been no breaches in the financial covenants of any interest-bearing loans and borrowing in the current period.
No changes were made in the objectives, policies or processes for managing capital during the current years and previous years.
3.1 Financial risk management
The Company''s activities expose it to a variety of financial risks which includes market risk (including currency risk, interest rate risk and other price risk), credit risk and liquidity risk.
The Company''s focus is to ensure liquidity which is sufficient to meet the Company''s operational requirements. The Company monitors and manages key financial risks so as to minimize potential adverse effects on its financial performance. The Company has a risk management policy which covers the risks associated with the financial assets and liabilities. The details for managing each of these risks are summarized ahead.
3.2 Market risk
Market risk is the risk that the expected cash flows or fair value of a financial instrument could change owing to changes in market prices. The Company''s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates
3.3 Credit risk management
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the Company. The Company''s exposure to credit risk primary arises from trade receivables, balances with banks, investments and security deposits. The credit risk on bank balances is limited because the counter parties are banks with good credit ratings.
3.4 Trade Receivables
Credit risk is managed through credit approvals, establishing credit limits, continuous monitoring of creditworthiness of customers to which the company grants credit terms in the normal course of business. The Company also assesses the financial reliability of customers taking into account the financial condition, current economic trends and historical bad debts and ageing of accounts receivables.
3.5 Cash & Cash Equivalents
With respect to credit risk arising from financial assets which comprise of cash and cash equivalents, the Company s risk exposure arises from the default of the counter party, with a maximum exposure equal to the carrying amount of these financial assets at the reporting date. Since the counter party involved is a bank, Company considers the risks of non-performance by the counter party as non-material.
3.6 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. The company''s treasury department is responsible for liquidity, funding as well as settlement management. In addition, processes and policies Related to such risks are overseen by senior management. Management monitors the Company''s net liquidity position through rolling forecasts on the basis of expected cash flows.
Maturity profile of financial liabilities
The table below provides details regarding the remaining contractual maturities of financial liabilities at the reporting date based on contractual undiscounted payments.
3.7 Fair value measurements
This note provides information about how the company determines fair values of various financial assets and financial liabilities.
Fair value of financial assets and financial liabilities that are not measured at fair value (but fair value disclosures are required)
The directors consider that the carrying amounts of financial assets and financial liabilities recognized in the financial statements approximate their fair values.
Note 4. Operating Segment
The company''s sole business segment is manufacturing and marketing of Oils & De-oiled Cakes and the geographical segment is India. Consequently no separate disclosure, as required under Indian Accounting Standard 108 - Operating Segment, is considered relevant.
Note 5. Other Disclosures
5.1 During the previous year, the Board of Directors of the Company in its meeting held on 15 December, 2016 approved to create, offer, issue and allot upto 1538463 (Fifteen Lakh Thirty Eight Thousand Four Hundred and Sixty Three) Warrants, entitling the holder (s) thereof to apply for and be allotted one fully paid up equity share of face value of Rs.10 each at a price of Rs.130/- (including a premium of Rs.120/-each),in one or more tranches, within 18 months from the date of allotment of Warrants, on preferential basis to non-promoters group entities as under:
subject to the approval of the shareholders in the General Meeting and the approval of the appropriate authorities.
The Company by way of Special Resolution passed at Extra Ordinary General Meeting dated 9 January, 2017 approved issue of the said Warrants, at a price of Rs. 130/- per Warrant on such terms and conditions, as placed before them in the meeting. Thereafter, Inprinciple approval for the issue of the said Warrants was obtained from the Bombay Stock Exchange Limited (BSE) on 11 January, 2017.
Afterwards, the Company issued and allotted 1538463 (Fifteen Lakh Thirty Eight Thousand Four Hundred and Sixty Three) Warrant in its Board Meeting held on 19 January, 2017.
The Company has received Rs.100000095.00 being 50% of the allotment amount as advance toward the issue of said Warrants and same is shown in shareholders fund after the capital of the Company. The funds raised have been used for the purposes for which the funds were raised and there is no unutilized amount of proceeds of issue of said Warrants.
The Warrants may be converted into equivalent number of fully paid up equity shares on payment of balance amount at any time, not exceeding 18 (eighteen) months from the date of allotment of such warrants.
Further, the said Warrants, subject to the terms and conditions stipulated at the time of their issue, are under a lock-in upto 18 July, 2018.
5.2 Disclosure in respect of operating leases under Indian Accounting Standard (AS) - 17 "Leases".
(a) General description of the Company''s operating lease arrangements:
The Company enters into operating lease arrangements for leasing area offices, factory building, equipments and residential premises for its employees.
Some of the significant terms and conditions of the arrangements are:
- Agreements for most of the premises may generally be terminated by the lessee or either party by serving two to three month''s notice or by paying the notice period rent in lieu thereof.
- The lease arrangements are generally renewable on the expiry of lease period subject to mutual agreement.
- The company shall not sublet, assign or part with the possession of the premises without prior written consent of the lessor.
(b) Lease rent charged to the Profit and Loss Account on account of Minimum lease rentals Rs.77,91,110/- (Previous year Rs. 90,91,954/-)
Notes to the reconciliation
1. Under previous GAAP, actuarial gains and losses were recognized in profit or loss. Under Ind AS, the actuarial gains and losses form part of remeasurement of the net defined benefit liability/asset which is recognized in other comprehensive income.
2. Under the previous GAAP, revenue from sale of products was presented exclusive of excise duty. Under Ind AS, revenue from sale of goods is presented inclusive of excise duty. The excise duty paid is presented on the face of statement of profit and loss as part of expenses. There is no impact on the total equity and profit.
3. Under Previous GAAP, there was no concept of other comprehensive income. Under Ind AS, specified items of income, expenses, gains, or losses are required to be presented in other comprehensive income.
The effective date for adoption of Ind AS 115 is financial periods beginning on or after April 1, 2018.
The Company will adopt the standard on April 1, 2018 by using the cumulative catch-up transition method and accordingly comparatives for the year ending or ended March 31, 2018 will not be retrospectively adjusted. The company is evaluating the effect on adoption of Ind AS 115.
Note: 6.
Approval of financial statements
The financial statements for the year ended 31 March, 2018 were approved by the Board of Directors and authorize for issue on 30th May, 2018.
Mar 31, 2016
(1.) The company has only one class of equity shares, having a par value of Rs.10 per share. Accordingly, all equity shares rank equally with regard to dividends and share in the Company''s residual assets. Each shareholder is eligible to one vote per share held. The dividend proposed, if any, by the Board of Directors is subject to approval of shareholders in the ensuing Annual General Meeting, except in case of interim dividend. The repayment of equity share capital in the event of liquidation and buy back of shares are possible subject to prevalent regulations. In the event of liquidation, normally the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts, in proportion to their shareholding.
(2.) Issued, subscribed and paid-up capital of the company includes:-
(i) 2026592 Shares (Previous Year 2026592) of Rs 10 each fully paid up allotted in the last five years to Shareholders of M/s J.P Management Systems P Ltd pursuant to the scheme of amalgamation with the Company, for consideration other than cash.
(ii) 4238967 shares (Previous Year 4238967) allotted as Bonus Shares by way of Capitalisation of Profits.
(iii) 2640000 Shares (Previous Year 2640000) issued by way of conversion of Optionally Convertible Warrants into equity shares Rs.10/- each at a premium of Rs.20/- each.
Security
(a) Term Loan from banks is secured by way of equitable mortgage of Factory Land & Building and Hypothecation of Plant & Machinery of all the units at Bisalpur Road and Bareilly Road, Stock and Book Debts, Personal guarantees of Mr. Anil Modi, Mrs. Nita Modi and Sh Akshay Modi.
(b) Vehicle Loans are secured against hypothecation of respective Vehicles
3. Working Capital facility comprises cash credit from bank and is secured against hypothecation of raw materials, semi finished goods, finished goods, consumable stores, book debts, all securities of units at Bisalpur Road and Bareilly Road, Pilibhit and personal guarantees of Mr. Anil Modi, Mrs Nita Modi and Mr Akshay Modi.
4. Sales/Trade Tax, Excise Duty, CENVAT and Service Tax have been accounted for as per deposit/book records, the liability/ refunds of such taxes being accounted for on finalization of assessment/demand.
5. Income tax assessments for and up to assessment year 2013-2014 have been made.
Note: Related parties are as identified by the company and relied upon by the Auditors.
6. The company''s sole business segment is manufacturing and marketing of Oils & De-oiled Cakes and the geographical segment is India. Consequently no separate disclosure, as required under Accounting Standard 17 - Segment Reporting, is considered relevant.
7. Disclosure in respect of operating leases under Accounting Standard (AS) - 19 "Leases" prescribed by the Companies (Accounting Standards) Rules, 2006.
a. General description of the Company''s operating lease arrangements:
The Company enters into operating lease arrangements for leasing area offices, factory building, equipments and residential premises for its employees
Some of the significant terms and conditions of the arrangements are:
- Agreements for most of the premises may generally be terminated by the lessee or either party by serving two to three month''s notice or by paying the notice period rent in lieu thereof.
- The lease arrangements are generally renewable on the expiry of lease period subject to mutual agreement.
- The company shall not sublet, assign or part with the possession of the premises without prior written consent of the lessor
b. Lease rent charged to the Profit and Loss Account on account of Minimum lease rentals Rs.75,84,873/- (Previous year Rs. 53,08,924/-)
8. Figures have been rounded off to the nearest rupee and previous year figures have been updated/regrouped/rearranged wherever necessary.
Mar 31, 2015
1. Corporate Information
Modi Naturals Limited is a Public Limited Company domiciled in India
and Incorporated under the provisions of Companies Act, 1956. The
shares of company are listed at Bombay Stock Exchange. The Company is
in the business of manufacturing and marketing of oils and de-oiled
cakes.
2. The company has only one class of equity shares, having a par
value of Rs.10 per share. Accordingly, all equity shares rank equally
with regard to dividends and share in the Company' s residual assets.
Each shareholder is eligible to one vote per share held. The dividend
proposed, if any, by the Board of Directors is subject to approval of
shareholders in the ensuing Annual General Meeting, except in case of
interim dividend. The repayment of equity share capital in the event of
liquidation and buy back of shares are possible subject to prevalent
regulations. In the event of liquidation, normally the equity
shareholders are eligible to receive the remaining assets of the
Company after distribution of all preferential amounts, in proportion
to their shareholding.
3. Issued, subscribed and paid-up capital of the company includes:-
(i) 2026592 Shares (Previous Year 2026592) of Rs 10 each fully paid up
alloted in the last five years to Share holders of M/ s J.P Management
Systems P Ltd pursuant to the scheme of amalgamation with the Company,
for consideration other than cash
(ii) 4238967 shares (Previous Year 4238967) alloted as Bonus Shares by
way of Capitalisation of Profits
(iii) 2640000 Shares (Previous Year 2640000) issued by way of conversion
of Optionally Convertible Warrants into equity shares Rs.10/- each at a
premium of Rs.20/- each.
(a) Term Loan from banks is secured by way of equitable mortgage of
Factory Land & Building and Hypothecation of Plant & Machinery of all
the units at Bisalpur Road and Bareilly Road, Stock and Book Debts,
Personal guarantees of Mr. Anil Modi and Mrs. Nita Modi and corporate
guarantee of Das Investments Pvt. Ltd.
(b) Vehicle Loans are secured against hypothecation of respective
Vehicles
4. Working Capital facility comprises cash credit from bankand is
secured against hypothecation of raw materials, semi finished goods,
finished goods, consumbale stores, book debts, all securities of units
at Bisalpur Road and Bareilly Road, Pilibhit and personal guarantees of
Mr. Anil Modi and Mrs. Nita Modi.
5. CONTINGENT LIABILITIES
(not provided for) This Year Previous Year
(Rs.) (Rs.)
i. Claim against the company not
acknowledge as debts :
Sales Tax 40,000 93,399
Provident Fund 54,62,669 54,62,669
Excise Duty 3,06,49,361 2,64,63,303
ii. Sales Tax Liability against pending
forms 45,61,570 32,52,216
iii. Capital commitment (net of advance) 3,00,900 -
6. Sales/Trade Tax, Excise Duty, CENVAT and Service Tax have been
accounted for as per deposit/book records, the liability/ refunds of
such taxes being accounted for on finalisation of assessment/demand.
7. Income tax assessments for and upto assessment year 2013-2014 have
been made.
8. Related Parties Disclosures as required by Accounting Standard (AS
18) are as under:-
1. Names of the related parties with whom transactions have taken place
during the year:-
(A) Key Management Personnel Mr. Anil Modi, Managing Director Mr.
Akshay Modi, Executive Director
(B) Relatives of Key Management Personnel.
Nita Modi
(C) Enterprises over which key Management personnel, or his relative,
has significant influence.
Anil Modi (HUF)
Note : Related parties are as identified by the company and relied upon
by the Auditors.
9. The company's sole business segment is manufacturing and marketing
of Oils & De-oiled Cakes and the geographical segment is India.
Consequently no separate disclosure, as required under Accounting
Standard 17 - Segment Reporting, is considered relevant.
10. Disclosure in respect of operating leases under Accounting
Standard (AS) - 19 "Leases" prescribed by the Companies (Accounting
Standards) Rules, 2014.
(a) General description of the Company's operating lease arrangements:
The Company enters into operating lease arrangements for leasing area
offices, factory building, equipments and residential premises for its
employees.
Some of the significant terms and conditions of the arrangements are:
* Agreements for most of the premises may generally be terminated by
the lessee or either party by serving two to three month's notice or by
paying the notice period rent in lieu thereof.
* The lease arrangements are generally renewable on the expiry of lease
period subject to mutual agreement.
* The company shall not sublet, assign or part with the possession of
the premises without prior written consent of the lessor.
(b) Lease rent charged to the Profit and Loss Account on account of
Minimum lease rentals Rs.52,06,724/- (Previous year Rs.32,20,845/-)
11. Figures have been rounded off to the nearest rupee and previous
year figures have been updated/regrouped/ rearranged wherever
necessary.
Mar 31, 2013
1. Corporate Information
Modi Naturals Limited is a Public Limited Company domiciled in India
and Incorporated under the provisions of Companies Act, 1956. The
shares of company are listed at Bombay Stock Exchange. The Company is
in the business of manufacturing and marketing of oils and de-oiled
cakes.
2.CONTINGENT LIABILITIES (not provided for)
This Year Previous Year
(in Rs.) (in Rs.)
i. Claim against the company not
acknowledge as debts :
Sales Tax 39,23,541 38,30,142
Provident Fund 38,12,063 38,12,063
ii. Sales Tax Liability
against pending forms 38,53,093 16,75,208
3. Sales/Trade Tax, Excise Duty, CENVAT and Service Tax have been
accounted for as per deposit/book records, the liability/ refunds of
such taxes being accounted for on fnalisation of assessment/demand.
4. Income tax assessments for and upto assessment year 2011-2012 have
been made.
5. Related Parties Disclosures as required by Accounting Standard (AS
18) are as under:- 1. Names of the related parties with whom
transactions have taken place during the year:- (A) Key Management
Personnel
Mr. Anil Modi, Managing Director Mr. Akshay Modi, Executive Director
(B) Relatives of Key Management Personnel. Nita Modi
(C) Enterprises over which key Management personnel, or his relative,
has signifcant infuence. Anil Modi (HUF)
Note : Related parties are as identifed by the company and relied upon
by the Auditors.
6. The company''s sole business segment is manufacturing and marketing
of Oils & De-oiled Cakes and the geographical segment is India.
Consequently no separate disclosure, as required under Accounting
Standard 17 - Segment Reporting, is considered relevant.
7. Disclosure in respect of operating leases under Accounting
Standard (AS)  19 "Leases prescribed by the Companies (Accounting
Standards) Rules, 2006.
(a) General description of the Company''s operating lease arrangements:
The Company enters into operating lease arrangements for leasing area
ofces, factory building, equipments and residential premises for its
employees.
Some of the signifcant terms and conditions of the arrangements are:
- Agreements for most of the premises may generally be terminated by
the lessee or either party by serving two to three month''s notice or by
paying the notice period rent in lieu thereof.
- The lease arrangements are generally renewable on the expiry of lease
period subject to mutual agreement.
- The company shall not sublet, assign or part with the possession of
the premises without prior written consent of the lessor.
(b) Lease rent charged to the Proft and Loss Account on account of
Minimum lease rentals Rs.19,82,783/- (Previous year Rs.5,76,000/-)
8. Value of imported and indigenous raw materials, stores, components
and spare parts consumed:
9. Figures have been rounded of to the nearest rupee and previous
year fgures have been updated/regrouped/rearranged wherever
necessary.
Mar 31, 2012
1 : Corporate Information
Modi Naturals Limited is a Public Limited Company domiciled in India
and incorporated under the provisions of Companies Act, 1956. The
shares of company are listed at Bombay Stock Exchange. The Company is
in the business of manufacturing and marketing of oils and de-oiled
cakes.
(1.2) The company has only one class of equity shares, having par value
of Rs.10 per share. Accordingly, all equity shares rank equally with
regard to dividends and share in the Company' s residual assets. Each
shareholder is eligible to one vote per share held. The dividend
proposed, if any, by the Board of Directors is subject to approval of
shareholders in the ensuing Annual General Meeting, except in case of
interim dividend. The repayment of equity share capital in the event of
liquidation and buy back of shares are possible subject to prevalent
regulations. In the event of liquidation, normally the equity
shareholders are eligible to receive the remaining assets of the
Company after distribution of all preferential amounts, in proportion
to their shareholding.
(1.3) Issued, subscribed and paid-up capital of the company includes:-
(i) 2,026,592 shares (Previous Year 2,026,592) of Rs 10 each fully paid
up alloted in the last five years to shareholders of M/s J.P.
Management Systems P Ltd pursuant to the scheme of amalgamation with
the Company, for consideration other than cash.
(ii) 4,238,967 shares (Previous Year 4,238,967) alloted as Bonus Shares
by way of Capitalisation of Profits.
(iii) 2,640,000 shares (Previous Year 2,072,000) issued by way of
conversion of Optionally Convertible Warrants into equity shares
Rs.10/- each at a premium of Rs.20/- each.
Security
(a) Term Loan from banks is secured by way of equitable mortgage of
Factory Land & Building and Hypothecation of Plant & Machinery of all
the units at Bisalpur Road and Bareilly Road, Stock and Book Debts,
Personal guarantees of Mr. Anil Modi and Mrs. Nita Modi and corporate
guarantee of Das Investments Pvt. Ltd.
(b) Vehicle Loans are secured against hypothecation of respective
Vehicles.
1.4 Working Capital facility comprises cash credit from bank and is
secured against hypothecation of raw materials, semi finished goods,
finished goods, consumbale stores, book debts, all securities of units
at Bisalpur Road and Bareilly Road, Pilibhit and personal guarantees of
Mr. Anil Modi and Mrs. Nita Modi and corporate guarantee of Das
Investments Pvt. Ltd.
1.5 The company had sought confirmation from its vendors on their
status under Micro, Small and Medium Enterprises Development Act, 2006
("MSMED Act") which came into force from 2 October 2006. Based on
the confirmations received till date, the disclosure as required by
section 22 of the MSMED Act are given below:-
2: Contingent liabilities (not provided for)
This Year Previous
Year
(in) (in)
i. Claim against the company
not acknowledge as debts :
Provident Fund 3,812,063 -
Others 3,830,142 3,830,142
ii. Capital commitment (Net of
advances) - 5,861,828
iii. Sales Tax Liability against
pending forms 1,675,208 -
31: Security Deposits under Note
14 Long Term Loan and Advances
includes:-
- In Post Office Saving Bank Account,
pledged with: RFC 5,000 5,000
- National Saving Certificates,
pledged with: Sales Tax Department 1,000 1,000
- National Saving Certificates,
pledged with: RFC 5,000 5,000
- National Saving Certificates,
pledged with: Senior Marketing
Inspector, Pilibhit 5,000 5,000
- National Saving Certificate
pledged with DSO, Pilibhit 22,000 22,000
- National Saving Certificate
pledged with Krishi Utpadan Mandi Samiti 7,000 7,000
3: Sales/Trade Tax, Excise Duty, CENVAT and Service Tax have been
accounted for as per deposit/book records, the liability/refunds of
such taxes being accounted for on finalisation of assessment/demand.
4: Income tax assessments for and upto assessment year 2009-10 have
been made.
5: The Company has provided for minimum alternate tax in the Profit &
Loss Account of the year as per section 115JB of the Income Tax Act,
1961. Any credit available in subsequent year against this tax shall be
adjusted against the Income Tax payable for these years.
6: Related Parties Disclosures as required by Accounting Standard (AS
18) are as under:-
1. Names of the related parties with whom transactions have taken place
during the year:-
(A) Key Management Personnel
Mr. Anil Modi, Managing Director
Mr. Akshay Modi, CEO, Whole time Director from 15.12.2010
(B) Relatives of Key Management Personnel.
Nita Modi
(C) Enterprises over which key Management personnel, or his relative,
has significant influence.
Anil Modi (HUF)
Note : Related parties are as identified by the company and relied upon
by the Auditors.
7: The company's sole business segment is manufacturing and marketing
of Oils & De-oiled Cakes and the geographical segment is India.
Consequently no separate disclosure, as required under Accounting
Standard 17 - Segment Reporting, is considered relevant.
8: Disclosure in respect of operating leases under Accounting Standard
(AS) - 19 "Leases" prescribed by the Companies (Accounting
Standards) Rules, 2006.
(a) General description of the Company's operating lease arrangements:
The Company enters into operating lease arrangements for leasing area
offices, factory building, equipments and residential premises for its
employees.
Some of the significant terms and conditions of the arrangements are:
- Agreements for most of the premises may generally be terminated by
the lessee or either party by serving two to three month's notice or by
paying the notice period rent in lieu thereof.
- The lease arrangements are generally renewable on the expiry of lease
period subject to mutual agreement.
- The company shall not sublet, assign or part with the possession of
the premises without prior written consent of the lessor.
(b) Lease rent charged to the Profit and Loss Account on account of
Minimum lease rentals Rs. 762,000/- (Previous year Rs.1,40,000/-)
9: Directors have been paid remuneration in terms of special
resolution and in accordance with Schedule XIII to the Companies Act,
1956, as under:
Remuneration to the Managing Director and Whole Time Director
Note: Remuneration excludes provision for gratuity determined on
actuarial basis as these are determined for the company as a whole.
Shri Anil Modi, Chairman & Managing Director has not been paid any
commission during the current year due to inadequate profits.
10 Figures have been rounded off to the nearest rupee and previous year
figures have been updated/regrouped/ rearranged wherever necessary.
Mar 31, 2010
1. CONTINGENT LIABILITIES
(not provided for) This Year Previous Year
(Rs.) (Rs.)
a. Claims not accepted 38,30,142 38,30,142
b. Entry Tax 1,88,521 -
2. An Investment Incentive of Rs.50,00,000/- had been sanctioned to
the company during 2007-08 in respect of its Pilibhit Unit, which had
been capitalised by transfer to Capital Reserve.
National Saving Certificate pledged with Krishi Utpadan Mandi Samiti
7,000 7,000
3. Sales/Trade Tax, Excise Duty, CENVAT and Service Tax have been
accounted for as per deposit/book records, the liability/refunds of
such taxes being accounted for on finalisation of assessment/demand.
4. Income tax assessments for and upto assessment year 2008-09 have
been made.
5. Provision for Income Tax liability has been computed after taking
into account allowable deduction under provisions of Income Tax Act,
1961 and is considered adequate.
6. The company has, during the year, not received any intimation from
its suppliers regarding their status under the The Micro, Small and
Medium Enterprises Development Act, 2006 and hence the following
information required under the said Act have not been given:-
a) Delayed payments due as at the end of each accounting year on
account of principal and interest thereon.
b) Total interest paid on all delayed payments during the year under
the provisions of the Act.
c) Interest due on principal amounts paid beyond the due date during
the year but without the interest amounts undertheAct.
d) Interest accrued but not due.
e) Total interest due but not paid.
The company generally makes payment to all its suppliers within the
agreed credit period (less than 45 days) and thus the management is
confident that liability of interest under this Act, if any, would not
be material.
7. Related Parties Disclosures as required by Accounting Standard (AS
18) are as under:-
1. Names of the related parties with whom transactions have taken
place during the year:-
(A) Key Management Personnel
Mr. Anil Modi, Managing Director
Mr. Akshay Modi, CEO
(B) Relatives of Key Management Personnel.
Smt. Satya Modi
Neha Modi
Nita Modi
(C) Enterprises over which key Management personnel, or his relative,
has significant influence.
Anil Modi (HUF)
D.D. Modi (HUF)
8. The companys sole business segment is manufacture and sale of Oils
& De-oiled Cakes and the geographical segment is India. Consequently no
separate disclosure, as required under Accounting Standard 17 - Segment
Reporting, is considered relevant.
9. Information pursuant to para 3,4C and 4D of Part II of Schedule VI
to the Companies Act, 1956 (to the extent applicable):
10. Figures have been rounded off to the nearest rupee and previous
year figures have been updated/regrouped/rearranged wherever necessary.
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