a) Trade receivables are generally due between 30 days to 60 days based on submission and certification of invoices.
b) Credit risk is managed at client and contract level. At the time of entering into contracts, the credit period is mutually agreed and varies from contract to contract.
c) The Company has evaluated on contract to contract basis for computing credit loss allowance, if any, for the receivables.
d) Some trade receivables may be past due over 365 days without being impaired considering the certainty of realisation
Deferred tax liabilities are the amounts of income taxes payable in future periods in respect of taxable temporary differences.
Deferred tax assets are the amounts of income taxes recoverable in future periods in respect of:
(a) deductible temporary differences;
(b) the carry forward of unused tax losses; and
(c) the carry forward of unused tax credits.
The Company elected to exercise the option under Section 115BAA of the Income Tax Act, 1961 as introduced by the Taxation Laws (Amendment) Ordinance, 2019. The full impact on account of remeasurement of Deferred Tax Assets and Liabilities due to revised rates, have been recognised in the statement of Profit and Loss for the year ended 31st March 2020.
d) * Ageing of Trade Receivables - as follows :
The company has only one class of equity shares having a par value of Rs. 10/- per share. Each holder of equity shares is entitled to one vote per share. The dividend, if proposed by the Board of Directors, is subject to approval of the shareholders in the ensuing annual general meeting. In the event of liquidation of the company, the holders of equity shares will be entitled to receive remaining assets of the company, after distribution of all preferential amounts.
* Capital Reserve includes the amounts received as Capital subsidy from Government of Tamil Nadu and those arising out of amalgamation in earlier years
* General Reserve is a free reserve, retained from Company's profits and can be utilised upon fulfilling certain conditions in accordance with the Companies Act, 2013.
* Securities Premium account represents the premium received towards allotment of 16,47390 Rights issue shares in 2008-09 and 2,99,38,818 Rights issue shares in 2013-14 , net of utilisation for permitted purposes under Companies Act.
* Balance will be utilised in accordance of provisions of Section 52 and Section 68 of the Companies Act.
* Balance in Retained earnings , when positive, can be distributed by the Company as dividends to its equity shareholders, in compliance of the Companies Act and depending on the financial position and dividend policy of the Company.
* Reserve for equity instruments represents the cumulative gains and losses arising on the revaluation of equity instruments measured at fair value through Other Comprehensive income.
The preference shares, carrying a coupon rate of 7% p a, are cumulative in nature and by virtue of agreement with
Preference Shareholders, the date of redemption is extended upto 22nd August 2022 for Rs 700 Lakhs . During the
Year 2019-20, additional cumulative non convertible preference shares were issued to the tune of Rs 1200 Lakhs
on 3rd Sep 19 and Rs 935.63 Lakhs on 24th Oct 19, carrying a coupon rate of 7% p a, redeemable after 5 years.
Dividend is waived upto 31st March 2023 for all 28,35,630 shares. Dividend not paid for an year will be paid in
arrears, in subsequent year, subject to availability of Profits and other statutory requirements.
Disclosure on preference share capital, in connection with NCLT order Dated 9th May 2023
• The company had, based on the consent provided by the preference shareholders and Equity shareholders during the FY 2021-22 for complete extinguishment of the rights of preference shareholders and entitlements with respect to the preference shares of the value of Rs.2835.63 lakhs allotted to them had approached the NCLT, Chennai, with a Scheme of Reduction of Preference Share capital. The NCLT vide its order dated 9th of May 2023, has approved the said extinguishment of the entire obligation of the Company with respect to the Preference Share Capital of Rs.2835.63 lakhs.
• As per the Board resolution of the Company, the extinguishment will come into effect from the date of approval of NCLT which is 9th May 2023. Hence, the effect of extinguishment is not considered in the financial statements of the Company for the year ending 31st March 2023 and as at 31st March 2023. The terms of the order of NCLT in CP No. 42 (CHE) of 2022 dated 9th May 2023 have been fully complied with and duly certified by the Company Secretary and Compliance Officer.
• Consequent to the extinguishment of entire obligations towards preference share capital as approved by the NCLT, the net worth of the Company which is (Rs. 2048.43 Lakhs Negative) as on 31st March 2023 will stand improved to Positive networth.
• The necessary financial effect of the extinguishment of the preference share capital of the company have given effect in the first quarter of the FY 2023-24.
• Pursuant to the scheme for reduction of preference share capital, the accumulated losses of the company would be set-off to the extent of Rs.2835.63 lakhs.
Note 30
Contingent liability
(' in lakhs)
As at
31-Mar-24
31-Mar-23
1.1 Estimated amount of contracts remaining to be executed on capital account not provided for
Nil
1.2. a) Guarantees issued by the Company's bankers for which the Company has given counter guarantees.
(Net of guarantees for which liability exists in the books of account)
1783.66
1906.51
b) Letter of credits issued by the Company's bankers for which the Company has given counter guarantees
1.3. Estimated liability on account of certain taxes and duties not provided for
a) Kerala VAT for 2011-12
tax on disputed turnover and interest thereon (Rs. 0.66 Lacs paid, appeal filed)
5.60
b) GST - Odisha - Interest for the TRAN 1 credit reversal The Deputy Commissioner of CT & GST, Ganjam - II Circle, Odisha issued a Show Cause Notice for Rs. 5.43 lakhs on 25/10/2021, with the order passed on 10/12/2021, and after the appeal was dismissed on 28/06/2023, a further appeal to the Appellate Tribunal has been filed.
5.43
c) Suit filed by the Vendor 'in the Court of Telangana
52.01
d) Suit filed by the Vendor against the Company 'in the court of Madurai high Court (CMA (MD) 840 of 2022 (Provided in books Rs.1.60 lakhs)
6.00
-
e) TN / GST - FY 2017-18
On 30/12/2023, the Deputy Commercial Tax Officer, TN, issued an order for Rs. 4,997.35 lakhs under Section 73 of the TNGST 2017, which was partially rectified to Rs. 2,135.93 lakhs on 10/01/2024.
A writ petition challenging these orders was filed on 22/01/2024, resulting in the High Court quashing the assessment and remanding it for reconsideration on 08/02/2024.
2135.93
f) TN / GST - FY 2017-18
On 30/12/2023, the Deputy Commercial Tax Officer, TN, issued an order for Rs. 5.65 lakhs under Section 73 of the TNGST 2017 for excess ITC claimed under reverse charge mechanism, with an appeal filed on 01/03/2024.
5.65
g) TN / GST - FY 2018-19
On 29/04/2024, the Deputy Commercial Tax Officer, TN, issued an order for Rs. 55.66 lakhs under Section 73 of the TNGST 2017 for ITC discrepancies, with an appeal yet to be filed.
55.66
h) AP / GST - FY 2017-18
On 29/12/2023, the Assistant Commissioner (ST), Andhra Pradesh, issued an order for Rs. 24.10 lakhs under Section 73 of the APGST Act 2017 due to ITC mismatches, with an appeal filed on 26/03/2024.
24.10
i) AP / GST - FY 2018-19
On 23/04/2024, the Assistant Commissioner (ST), Visakhapatnam, issued a rectification order under Section 161 of SGST and CGST Acts for Rs. 96.52 lakhs, with Rs. 1.48 lakhs already paid, and an appeal is pending.
96.52
j) AP / GST - FY 2019-20
On 10/05/2024, the Assistant Commissioner (ST), Visakhapatnam, issued an order for Rs. 3.86 lakhs under Section 73 APGST Act 2017 for ITC discrepancies, with an appeal still pending.
3.86
k) AP / GST - FY 2020-21
On 09/05/2024, the Assistant Commissioner (ST), Visakhapatnam, issued an order for Rs. 7.57 lakhs under Section 73 AP GST Act 2017 for ITC discrepancies, with an appeal yet to be filed.
7.57
l) AP / GST - FY 2021-22
On 09/05/2024, the Assistant Commissioner (ST), Visakhapatnam, issued an order under Section 73 AP GST Act 2017 for Rs. 1.48 lakhs concerning ITC discrepancies between GSTR 2A and GSTR 3B. An appeal against this order is pending.
1.48
m) PF -Show Cause Notice
The company received a Show Cause Notice from the Regional PF Commissioner-I, Chennai, on 30/08/2023 for compliance violations. Following the company's response, the Commissioner directed on 29/01/2024 that the company recoup losses of Rs. 1,06,60,151.
106.60
*Mr.Sabaretnam Singaram have been appointed as Non-executive director with effect from 29th December 2023. His destination have been changed as Whole time director with effect from 13th February 2024. Hence, he received a sitting fees of Rs.0.1 lakhs for the board meeting held on 29th December 2023.
a) Defined Contribution plans :
The Company operates defined contribution retirement benefit plans for all qualifying employees. The assets of the plans are held separately from those of the Company under the control of trustees. When any employee leaves the plans before full vesting of contributions, the contributions payable by the Company are reduced by the amount of contributions forfeited by said employee.
b) Defined benefit plans :
The Company offers funded defined benefit plans for employees. Under the plans, the employees are entitled to post-retirement benefits amounting to 57.69% of last drawn monthly salary for each year of completed service until retirement age or resignation, subject to having specified years of service with the Company. The defined benefit plans are administered by separate funds, independent of the Company.
The above plans expose the Company to actuarial risks such as Investment, Interest rate, salary and longevity risk. These risks typically arise out of movement in market yields, interest rate movements, rate of increase in salary of participants and their tenure with the Company. Some of the risks are partially offset by counter gains of the fund.
No other Post-retirement benefits are provided to the employees.
The actuarial valuation of the plan assets and present value of defined benefit obligation were carried out as at 31st March, 2023 by a certified actuary of the Institute of Actuaries of India. The present value of defined benefit obligation and the related current service cost and past service cost, were measured using the projected unit credit method.
Note on Provident Fund :
With respect to the Provident Fund administered by the Trust, the Company shall make good deficiency, if any, between interest to be credited to members as per interest rate notified by Government and the return on investments on the Trust funds for the year.
Note 40 (' in lakhs)
a) Capital management
For the purpose of the Company's capital management, capital includes issued equity capital, securities premium and all other equity reserves attributable to the equity holders of the Company. The primary objective of the Company's capital management is to maximise the shareholder value.
The Company's approach on capital management are
a) Protecting the ability to continue as a going concern, so that return to shareholders and benefits to other stakeholders can be continuously provided
b) Maintain capital structure in such a manner to minimise the weighted average cost of capital
c) Financial risk management objectives
Based on the Company's activities, it is exposed to market risk, liquidity risk and credit risk. The following explains the manner in which the Company manages the risk.
i) Market risk arising from interest rate movement on long term borrowings are monitored through trend and sensitivity analysis and managed through negotiations
ii) Liquidity risk on account of borrowings and other liabilities are monitored through cash flow analysis and managed through having adequate sanctioned undrawn funded and non funded facilities. This addresses the financial liabilities portion.
iii) Credit risk on account of trade receivables and financial assets measured at amortised cost are measured through ageing analysis, counter party risk analysis and financial analysis, managed through review of credit limits, follow up and secured mode of payment.
• Mr. Raman Ramkumar, Managing Director of the company have resigned from the company with effect from 13th April 2024.
• The company have shifted its registered office from "Parry House", 5th Floor No. 43, Moore Street, Chennai-600001 to Bascon Futura, No 10/2, Old No.56L, Venkatanarayana Road, T.Nagar, Chennai-600017 with effect from 15th April 2024.
• Mr.Asir Raja Selvan M and Ms.Sridevi S have been regularised as Independent Director with effect from 17th May 2024 through postal ballot.
• The Board of directors of the company in its meeting held on 24th May 2024, have approved Change in designation of Mr.Sabaretnam Singaram from Whole time director and COO to Managing Director of the company with effect from 24th May 2024.
• The Board in its meeting held on 24th May 2024 have took note of resignation of Ms. Akila M as Company Secretary of the company with effect from 31st May 2024 and approved the appointment of Mr. Anto Abinash E as a Company Secretary of the company with effect from 01st June 2024.
No proceeding has been initiated or are pending against the Company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder.
The Company has not been declared wilful defaulter by any bank or financial institution or any other lender.
The Company has not had any transactions with Companies struck off under Section 248 of the Companies Act,2013 or Section 560 of the Companies Act, 1956.
There are no charges or satisfaction pending to be registered with Registrar of Companies beyond the statutory time limit
The Company does not have any layers prescribed under clause (87) of Section 2 of the Companies Act, 2013, read with the Companies (Restriction on number of Layers) Rules, 2017.
The Company does not have any transaction not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961.
The Company has not traded or invested in Crypto Currency or Virtual Currency during the year.
Utilisation of borrowed funds and share premium:
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:
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
Provide any guarantee, security or the like to or on behalf of the ultimate beneficiaries.
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:
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 a. Provide any guarantee, security or the like on behalf of the ultimate beneficiaries.
The Company does not have any Core Investment Companies in the group.
APPROVAL OF FINANCIAL STATEMENTS
The Financial statements were reviewed and recommended by the Audit committee and has been approved by the Board of Directors in their respective meeting held on 24th May 2024.