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NOTES TO ACCOUNTS

Advance Lifestyles Ltd.

You can view the entire text of Notes to accounts of the company for the latest year
Market Cap. (₹) 11.95 Cr. P/BV 0.34 Book Value (₹) 111.53
52 Week High/Low (₹) 50/23 FV/ML 10/1 P/E(X) 0.00
Bookclosure 28/09/2017 EPS (₹) 0.00 Div Yield (%) 0.00
Year End :2014-03 
1. The Company had suspended its operations at Ahmedabad since March 13, 1995 due to financial constraints and labour unrest. The Company was declared as a Sick Unit within the meaning of Section 3(1)(o) of the Sick Industrial (Special Provisions) Act, 1985 (SICA). The Board for Industrial and Financial Reconstruction (BIFR) vide its Order dated August 22, 2006 has discharged the Company from the purview of SICA.

The net worth of the Company has been represented by positive signs and recovered from the huge erosion as compared to past years financial results.

2. During the previous year 2012-13, the Company has acquired 3,14,999 Equity Shares of Rs. 10/- each at a premium of Rs. 23/- of M/s. Grant Infrastructure Pvt. Ltd. and thereby the said company became the subsidiary company. In past, the Company has paid advance for acquiring the land as well as has incurred the project construction expenses with the consent of the said company Grant Infrastructure Pvt. Ltd. On becoming Grant Infrastructure Pvt. Ltd., the subsidiary company, the project construction expenses of Rs. 3.19 Crores standing in the books of account of the Company has been transferred to the said subsidiary company Grant Infrastructure Pvt. Ltd.

Above treatment of transfer of construction work in progress to Grant Infrastructure Pvt. Ltd. has been shown in Note 12 forming part of Balance Sheet.

3. During the year, Advance Spacelink Pvt. Ltd. and Advance Infraspace Pvt. Ltd. ceases to be the subsidiary company as the company has sold 9,999 Equity Shares of each Advance Spacelink Pvt. Ltd. and Advance Infraspace Pvt. Ltd.

4. Other liabilities, which include worker's dues have been ascertained on the basis of available records with the Company and are subject to adjustments. Pending final settlement of dues, the payments to workers included in advance to employees, as per court order amounting to Rs. 17,37,506/- (Previous period Rs. 19,12,006/-) made in earlier years has been adjusted against liability provided/paid in pursuance of the Order.

5. The company had vide its letter dated September 19,2005 applied to the Income-tax Department for granting relief and concessions in accordance with the sanctioned Revival Scheme of BIFR vide their Order dated January 23, 2004. Further the BIFR vide its discharge Order dated August 22, 2006, issued directives to the Income tax department to exempt the Company from payment of capital gain tax and permit the Company to set off the capital gains, if any, against accumulated losses of the Company. However, the Income tax department filed an appeal before the Appellate Authority for Industrial and Financial Reconstruction (AAIFR) against the said directives of BIFR which was rejected by AAIFR vide its order dated 10th June 2008. In the financial year 2006-07 relevant to A.Y. 2007-08 the Assessing Officer has interpreted the order of BIFR and AAIFR that set-off of accumulated business loss against the Capital Gain beyond 8 years is not allowable and accordingly the demand was raised by the Income Tax Department. The said demand was challenged by the company by filing appeal before the CIT(Appeal). The CIT(Appeal) has decided the appeal in favor of the company, and the Income Tax Department has preferred an appeal before the ITAT which is pending before the ITAT. In the financial year 2007-08 relevant to A.Y. 2008-09, the Assessing Officer has levied the tax on book profit u/s 115JB of the Income Tax Act, 1961. Against the said order of the Assessing Officer, the Company has filed an appeal before CIT (A). The CIT (Appeals) has decided the appeal in favour of the company.

6. The Company and the Textile Labour Union arrived at a settlement in respect of employees' dues on 11/02/2008 and the same has been modified by the Honorable High Court of Gujarat on 15/02/2008, as a result of which the Company is liable to pay in respect of such settlement, an amount aggregating Rs. 15 crores (approx.) to 848 employees on the condition precedent, that the payment will be made to the concerned employee within sixty days after his resignation is received and in respect of the employees concerned having hut/chhapra/room/quarter in the mill premises and he is a beneficiary of the settlement/ order, he shall have to first vacate the hut/chhapra/room/quarter occupied by him in the mill premises and shall have to first handover possession thereof to the Mill Management and thereafter, within sixty days period, the Mill Management will pay the amount to the concerned employee as per the consent terms. The Honorable High Court further held that the closure declared by the Mill Management is legal and valid.

7. Consequent to Honorable High Court's order dated 15/02/2008, the company has already made the provision for gratuity relating to all employees in earlier years of the closure of the years 01/04/1997 to 31/03/2007. The liability (other than gratuity) in respect of retrenchment compensation and salary, the company has made the payment to the workers on the basis of resignation received from the employees and accounted for in the books in earlier years. Similarly, the company had also made the provisions for all unresigned employees including employees from whom resignations are yet to be received in terms of the order of High Court dated 15/02/2008 which is amounting to Rs. 3,04,73,417/- as on 31/03/2014 (Rs.3,32,71,288/- as on 31/03/2013).

8. Contingent Liabilities not provided for:

Estimated amount of contracts remaining to be execute on capital account not provided for (net of advance paid) is Rs. 87,50,000/- (Previous Year - Rs. 87,50,000/-).

The Income Tax assessments of the Company have been completed upto Assessment Year 2010-11. The demand of Rs.4,08,07,057/- for Assessment Year 2007-08 has been reduced to Rs. Nil as a result of Appellate Order of CIT(A) in favour of the Company. Against the said Appellate Order, the Income Tax Department has preferred second appeal before Tribunal which is pending to be decided. Similarly, the demand of Rs. 2,77,620/- for the Assessment Year 2008-09 has been reduced to Nil as a result of Appellate Order of CIT(A) in favour of the Company.

9. The survey proceedings u/s.133A of the Income-tax Act, 1961 was carried out at the business premises of the associate group company Phulchand Exports Pvt. Ltd. on 11/12/2012. In pursuance of the said survey proceedings, the company and associate group company Phulchand Exports Pvt. Ltd. had filed an application before the Hon'ble Settlement Commission, Mumbai, wherein the company had disclosed additional income of Rs.31,07,36,874/- for F.Y.2012-13 relevant to A.Y.2013-14 including capital gain on sale of shares of Advance Life space Pvt. Ltd. for an amount of Rs.30,88,83,060/-. During the year the Hon'ble Settlement Commission has passed the final order u/s.245D(4) of the I.T. Act, 1961 accepting the additional income offered by the company as assessed income. In the order passed by the Hon'ble Settlement Commission u/s.245D(4) of the Act, capitalization of the income earned by the company has been granted. The capitalization effect has been taken for an amount of Rs. 30,76,11,930/-. The company has paid the Income-tax on the additional income offered before the Hon'ble Settlement Commission for an amount of Rs. 7,17,56,772/-. The necessary accounting entries have been passed in the books of account. The capitalization in the form of cash balance for an amount of Rs. 6,76,11,930/- has been shown as on 31st March,2014 has included in cash on hand balance and Rs. 24,00,00,000/- shown as cash deposit against cheques and the additional income offered before the Hon'ble Settlement Commission after setting off tax paid has been shown under the head "Reserves & Surplus" for an amount of Rs. 23,58,55,158/-.

10. The company has not received information from any of its suppliers whether they are registered as Micro or Small enterprises or not and therefore the amount due to such suppliers, if any, has not been identified by the company.

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

12.Segment reporting:

The Company has identified two reportable segments viz. Textile Mill & Real Estate / Property Project activity. Segment have been identified and reported taking in to account nature of products and services, the differing risks and returns and the internal business reporting systems. The accounting policies adopted for segment reporting are in line with the accounting policy of the Company with the following additional notes for segment reporting.

a) Revenue and expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue and expenses which relate to enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as "Unallocable".

b) Segment asset and segment liabilities represent assets and liabilities in respective segments. Investments, tax related assets and other assets and liabilities that cannot be allocated to segment on reasonable basis have been disclosed as "Unallocable".

c) Information given in accordance with the requirements of Accounting Standard 17 on Segment Reporting notified under the Companies Act, 1956.

d) The Company has two reportable primary segments i.e. Textile Mill and Property Construction.

e) Unallocated represents all unallocable items not included in segments.

f) There are no inter-segment transactions during the period.

g) Information about Secondary Segments: Since all the activities of the Company in relation to the abovementioned Business segments are situated only at Ahmedabad, disclosure requirement under this segment are not applicable.

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