Carnation Industries Ltd. के अकाउंट के लिये नोट

Mar 31, 2025

Note 9.1: In terms of resolution passed by the Board of Directors of the company in its meeting dated 18th November 2024, the company on Dt. 28.11.2024 catagorised itsProperty plant and Equipments and Intangible assetsas detailed above.

The company has shifted its corporate office to New Delhi on and with effect from Dt: 18.11.2024.

Based on the current market expectation, the anticipated sales value of the assets exceeds its written down value. Consequently, no impairment has been recognised or recorded in relation to the assets. This assessment aligns with applicable accounting principles, and as the assets''s recoverable amount surpasses its carrying value, no adjustment for impairment is deemed necessary at this time.

*The company was acquired by the SRA consequent to NCLT order dt: 5th June 2024. The entire existing Shares of the Company was cancelled and new shares were issued as per the approved resolution plan as per the order of the Kolkata Bench of the Hon''able of NCLT . Total Number of existing shares cancelled 3457160 of Rs 10 each. The Company issued fresh shares in place of the existing shares. Total no of fresh share issued by the Company are 3457160 of Rs. 10 each. Out of the total numbers of fresh shares issued (3457160) 3110864 number of shares of Rs 10 each were issued to Shri Vikas Garg, and 346296 number of shares of Rs. 10/- each were issued to existing shareholders on pro rata basis in place of cancelled shares.

Note: 10.2: Terms/ rights attached to equity shares

The company has only one class of equity shares having face value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the 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. The distribution will be in proportion to the number of equity shares held by the shareholders.

Note: 10.3: Details of shareholders holding more than 5% shares in the company

The Company has received Listing Approval on March 26, 2025 from Bombay Stock Exchange (BSE). The corporate action for credit of shares in the respective accounts of the shareholders is in process accordingly list of shareholders as on 31-03-2025 is not yet updated.

Note:10.4: Details of shareholding of Promotors

The Company has received Listing Approval on March 26, 2025 from Bombay Stock Exchange (BSE). The corporate action for credit of shares in the respective accounts of the shareholders is in process accordingly list of shareholders as on 31-03-2025 is not yet updated.

Note 14.1: In terms of the Hon''ble National Company Law tribunal NCLT, Kolkata Bench (NCLT) Dt: 5th June 2024, the financial creditor i.e., ICICI Bank Limited (the lender) outstanding were settled. Satisfaction of charge at the Ministry of Corporate Affairs, Registrar of Companies, West Bengal is yet to be complied with.

Note 14.2: Unsecured Loans from Directors Outsatanding as on 31.3.2024 amounting Rs. 21.86 lacs has been written back.

Note 15.1: Identification of micro and small enterprises creditors are as per information received by the company from the sundry creditors and have been relied thereon by the auditor.

Note 15.2: Interest paid in terms of section 16 of Micro, Small and Medium Enterprises Development Act, 2006 (MSME Act, 2006) during the year is NIL (P.Y. NIL).

Note 15.3: Amount paid to the supplier beyond the appointed day during the year is Rs. NIL (P.Y. Rs.NIL).

Note 15.4: Amount of interest due and payable for the period of delay in making payment (which has been paid but beyond the appointed day during the year) but without adding the interest specified under the MSME Act, 2006 is NIL (P.Y. NIL).

Note 15.5 Amount of Interest accrued and remaining unpaid at the end of the year is Nil (P.Y. Rs. 17.56 Lacs).

Note 24 OTHER NOTES

i) The Hon''ble National Company Law Tribunal NCLT, Kolkata Bench (NCLT) admitted the Corporate Insolvency Resolution Process (CIRP) application filed by a financial creditor of Carnation Industries Limited (the Company) and appointed an interim resolution professional (IRP) in terms of the Insolvency and Bankruptcy Code, 2016 (the Code) to manage the affairs of the Company. Pursuant to this, based on the application made by the Committee of Creditors of the Company (COC), the Hon''ble NCLT appointed Anubrata Gangoly (RP) as the Resolution Professional for conducting Corporate Insolvency Resolution Process. Pursuant to COC''s approval of resolution plan dated April 13, 2024 as submitted by the Resolution Applicant, Mr. Vikas Garg , RP has filed an application for the approval of the resolution plan as submitted by SRA before Hon''ble NCLT. The company has recived the order on 5th day of June 2024 from the Honerable NCLT, Kolkata ,Wherein the successful resolution applicant will get the shares in the manner prescribed in the resolution plan. Accordingly the company has write back all ther liabilities appearing in the books of accounts which was not admitted and considered by the honorable NCLT while passing order under section-9 of the Insolvency and Bankrupcy Code 2016.

The entire existing Shares of the Company was cancelled and new shares were issued as per the approved resolution plan as per the order of the Kolkata Bench of the Hon''able of NCLT . Total Number of existing shares cancelled 3457160 of Rs 10 each. The Company issued fresh shares in place of the existing shares. Total no of fresh share issued by the Company are 3457160 of Rs. 10 each. Out of the total numbers of fresh shares issued (3457160) 3110864 number of shares of Rs 10 each were issued to Shri Vikas Garg, and 346296 number of shares of Rs. 10/- each were issued to existing shareholders on pro rata basis in place of cancelled shares.

ii) Estimated amount of contracts remaining to be executed on Capital Account is NIL (Previous year NIL).

iii) In terms of the Hon''ble National Company Law tribunal NCLT, Kolkata Bench (NCLT) Dt: 5th June 2024, the financial creditor i.e., ICICI Bank Limited (the lender) outstanding were settled. Satisfaction of charge at the Ministry of Corporate Affairs, Registrar of Companies, West Bengal is yet to be complied with.

iv) Contingent liability :

Refer to note 24(i) above, company has come out of Insolvancy process as per the Hon''ble National Company Law tribunal NCLT, Kolkata Bench (NCLT) Dt: 5th June 2024. In the management view there are no contingent liabilites as on the last date of financial year.

v) Gratuity and Other Post-Employment Benefit Plans:

Refer to note 24(i) above, company has come out of Insolvancy process as per the Hon''ble National Company Law tribunal NCLT, Kolkata Bench (NCLT) Dt: 5th June 2024. As on the end of the financial year, the employees have not completed the requisite period to be entitled for Gratuity and Leave encashment accordingly the Provision for Gratuity and Other Post-Employment Benefit Plans are not made

vi) In the opinion of the board, all Current Assets and Non-Current Assets have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the accounts.

vii) The assets and liabilities which are expected to be realised and payable in the ordinary course of business not later than 12 months from the reporting date have been classified as current assets and current liabilities in the Balance Sheet. All other assets and liabilities have been classified as non-current .

viii) The company has not commenced the Business Operations except administrative operations and accordingly there is no reportable segment for the purpose of IND-AS-108.

ix) Related party disclosures and transactions: for F.Y 2024-25

xi) Financial Instrument

Financial Instrument by category

Level-1 Quoted Price (unadjusted) is active markets for identical assets or liabilities

Level-2 Inputs other than quoted prices included within Level-1 that are observable for the asset or

liability, either directly (i.e as prices) or indirectly (i.e.) derived from prices).

Level-3 Inputs are unobservable inputs for the assets or Liability.

xii) Financial risk management objective and policies

The Company''s financial liabilities include Loan and borrowing, and Trade & other payables. The main purpose of these financial liabilities is to finance the Company''s operations. The Company''s financial assets include investments, trade & other receivables, deposits and cash & cash equivalents.

The Company''s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company''s financial performance. The Company uses derivative financial instruments to hedge certain risk exposures. The Company does not acquire or issue derivative financial instruments for trading or speculative purposes.

The Company''s activities expose it to Credit Risk, Liquidity Risk, Market Risk, and Equity Price Rise. The Board of Directors reviews and agrees policies for managing each of these risks, which are summarised below.

Credit Risk- A risk that counterparty may not meet its obligations under a financial instrument or customer contract, leading to a financial loss is defined as Credit Risk. The Company is exposed to credit risk from its operating and financial activities.

Customer credit risk is managed by the respective marketing department subject to the Company''s established policy, procedures and control relating to customer credit risk management. The Company reviews the creditworthiness of these customers on an on-going basis. The Company estimates the expected credit loss on the basis of past data, experience and policy laid down in this respect. The maximum exposure to the credit risk at the reporting date is the carrying value of the trade receivables disclosed in Note No. 6 as the Company does not hold any collateral as security. The Company has a practice to provide for doubtful debts as per its approved policy.

Liquidity Risk- A risk that the Company may not be able to settle or meet its obligations at a reasonable price is defined as liquidity risks. The Company''s finance department is responsible for managing 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.The Company''s objective is to maintain a balance between continuity of funding and flexibility through the use of cash credits, Term loans among others.

Foreign Currency Risk- A risk that the fair value or future value of the cash flows of a forex exposure will fluctuate because of changes in foreign exchange rates is defined as Foreign Currency Risk. The Company''s exposure to the risk of changes in foreign exchange rates relates primarily to the Company''s export and derivatives operating activities. The Company, as per its risk management policy, uses foreign exchange and other derivative instruments primarily to hedge foreign exchange exposure. The management monitors the foreign exchange fluctuations on a continuous basis.

Market Risk- A risk that the fair value of future cash flows of a financial instrument may fluctuate because of changes in market prices is defined as Marketing Risk. Such changes in the value of financial instruments may result from changes in the foreign currency exchange rates, interest rates, credit, liquidity and other market changes.

xiii) Figures for the previous year are re-classified / re-arranged / re-grouped, wherever necessary, to correspond with the current year classification / disclosure.

xiv) Title Deeds of Immovable Property is held in name of the Company and the same is in the Corporate Office.

xv) The Company does not have any investment property.

xvi) The Company has not Revalued any of its Property, Plant and Equipment

xvii) The Company has not granted any Loans or Advances in the nature of loans to Promoters, Directors, KMPs and related parties.

xviii) No proceeding has been initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act,1988 (45 of 1988) and rules made thereunder.

xix) The Company has no borrowings from banks or financial institutions on the basis of security of current assets.

xx) The company has no transactions with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

xxi) In terms of the Hon''ble National Company Law tribunal NCLT, Kolkata Bench (NCLT) Dt: 5th June 2024, the financial creditor i.e., ICICI Bank Limited (the lender) outstanding were settled. Satisfaction of charge at the Ministry of Corporate Affairs, Registrar of Companies, West Bengal is yet to be complied with.

xxii) Company doesnot have any Holding, Subsidiary or associate .

xxiv) (A) The Company has not advanced or loaned or invested funds (either borrowed funds or share

premium or any other sources or kind of funds) to any other person(s) or entity(ies), including foreign entities (Intermediaries).

(B) 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,

xxv) Undisclosed Income - The Company has not surrendered or disclosed any income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961).

xxvi) The Company has not traded or invested in Crypto currency or Virtual Currency during the financial year.

xxvii) The Board of Directors has carefully reviewed the financial position of the Company following the successful completion of the Corporate Insolvency Resolution Process (CIRP). The Company has emerged from the resolution process with a restructured financial position and a clear path to profitability. Based on the current financial performance, the successful implementation of the approved resolution plan, and available liquidity, the Board is confident that the Company will continue as a going concern for the foreseeable future, including the next 12 months and beyond. The Company has taken all necessary steps to address its previous financial challenges, and there are no material uncertainties that would cast significant doubt upon its ability to continue operations.The management is committed to executing the business plan and delivering long-term value to shareholders, employees, and other stakeholders. The management is scouting for appropriate business opportunity and once it is available the management would commence the same. The company is expected to start business during the next year. The status of the Company is going concern.

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Mar 31, 2015

1. General Information

Carnation Industries Limited (the Company) is a public company domiciled and incorporated in India. The company is engaged in the manufacture of foundry based engineering goods namely Cast Iron, Ductile Iron and Mild Steel Castings predominantly for export and also for domestic market having plants at various locations in West Bengal. Its shares are listed on two stock exchanges in India (Bombay Stock Exchange and The Calcutta Stock Exchange Ltd.).

2. Terms/rights attached to equity shares

The company has only one class of equity shares having face value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

3. During the year ended 31st March 2015, the amount of per share dividend recognised as distributable to equity shareholders is Re: 0.60 (31st March 2014: Re. 0.80). The total dividend appropriation for the year ended 31-03-2015 amounted to Rs.24.89 lacs (Previous year Rs.32.36 lacs) including corporate dividend tax of Rs. 4.15 lacs(Previous year Rs.4.70 lacs).

4. 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. The distribution will be in proportion to the number of equity shares held by the shareholders.

5. LONG -TERM BORROWINGS From Banks

(Secured against purchase of bills, hypothecation of stock in trade, Book Debts and receivables, Term Deposits, Equitable Mortgage of Land / Buildings owned by the Company as well as by some Direc- tors, charge on the existing and future plant & machinery owned by the Company and personal guar- antee of some Directors and guarantee by ECGC on pari-passu basis amongst the Bankers, including for short term borrowings)

6. SHORT-TERM BORROWINGS From Banks

(Secured against purchase of bills, hypothecation of stock in trade, Book Debts, and receivables, Term Deposits, Equitable Mortgage of Land / Buildings owned by the Company as well as by some Directors, charge on the existing and future plant & machinery owned by the Company and personal guarantee of some Directors and guarantee by ECGC on pari-passu basis amongst the Bankers including for long term borrowings.)

7 In view of insufficient information from the suppliers regarding their status as Micro, Small and Medium Enterprises, the amount remaining unpaid to such undertakings could not be ascertained for separate disclosure in our accounts.

8 Charge of hypothecation over Current Assets & Raw Materials procured under letter of credit in favour of bankers has been created for letter of credit issued. Agreegate value of such letter of credit outstanding as on 31st March, 2015 is Rs.787.64 lacs. (Previous Year Rs.695.36 lacs.)

9 Export proceeds in foreign exchange from a related party of Rs. 2907.51 lacs (Previous year Rs.1403 lacs) could not be realised within 12 month from the dates of export as at the end of the year. Total outstanding as on 31.03.2015 is Rs. 3173.04 lacs (Previous Year Rs. 3178.55 lacs). Out of that Rs. 64.75 lacs have since been realised.

10. OTHER NOTES

i) Estimated amount of contracts remaining to be executed on Capital Account is Rs. NIL (Net of advance of Rs. NIL) (Previous year Rs. 4.17 lacs, net of advance Rs. 25.63 lacs.)

ii) Contingent liability not provided for in respect of : (Rs. in Lacs)

As at As at 31.03.15 3 1.03.14

a) Outstanding Bank Guarantee 104.68 57.33

b) Disputed Duty & Penalty under 86.56 86.56 Central Excise Law

c) Disputed Vat Demand for the 100.13 100.13 Financial Year 2007-08

d) Duty drawback received amounted to Rs.57 lacs (Approx) (Previous year Rs. 27.00 lacs) is subject to export realisation.

11. In addition, the company has a few outstanding legal proceedings which have arisen in the ordinary course of business. However the company's management does not expect this legal proceedings, when concluded will have any material and adverse effect on the financial position of the company.

12 The Company, in respect of its claim for refund of Input Tax Credit amounting to Rs.106.03 lacs for the Financial Year 2005-06 had fled a revision petition u/s 87 of the VAT Act, 2003 against the Appellate Authority's order dt. 25/03/2011, rejecting the appeal and also fled an appeal before The West Bengal Commercial Taxes Appellate and Revisional Board for the financial year 2007-08 against the order passed by the Joint Commisioner of Sales Tax, Kolkata (South) Circle, rejecting the total claim of ITC for that year and also raised a demand for Rs.100.13 lacs.The revision petition and the appeal are still pending. Claims for the refund of Input Tax Credit in respect of other financial years are at various stages of adjudication with the Sales Tax Department. The Company expects realisation of these refund claims not later than 12 months from 31st March, 2015. The company had also been advised by its lawyer that these claims were worked out and made in confrmity and compliance with the stipulated rules and procedures. During the current financial year the company has partly received provisional refund of Input Tax Credit amounting to Rs.93.06 lacs, Rs.182.02 lacs and Rs. 50.05 lacs out of claims made for the financial year 2012-2013, 2013-2014 and 2014-2015 against submission of Indemnity Bonds equivalent to the amount of claim.

13 The company recognises overdue interest on export sales as and when the sale proceeds is realised as mutually agreed.

14 The Additional Commissioner of Central Excise, Kol-II and Haldia Commissionarate have raised two separate demands with penalty agreegating to Rs. 136.56 lacs out of which Rs. 50.00 lacs was paid in the financial year 2007-08. The Company had fled Appeals against the above demands before the Commissionarate (Appeal -I&II) of Central Excise Kolkata which are still pending.

15 Gratuity and Other Post-Employment Benefit Plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

16 The Company also provides Leave Encashment Benefit to employees, whereby unutilised leave is carried forward and eligible for encashment upon retirement / termination.

17.The following tables summarise the components of net benefit expense recognised in the Profit and Loss Account and amounts recognised in the Balance Sheet for the respective plans.

18. In the opinion of the board, all Current Assets and Non-Current Assets have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the accounts.Balance confirmation from certain vendors are yet to be received by the company.

19 The assets and liabilities which are expected to be realised and payable in the ordinary course of business not later than 12 months from the reporting date have been classified as current assets and current liabilities in the Balance Sheet. All other assets and liabilities have been classified as non-current.

20 Foreign Exchange gain of Rs.228.38 lacs (Previous year gain Rs. 94.66 lacs) are net of exchange gain of Rs. 1.74 lacs (Previous year Rs.1.00 lacs) arising out of conversion of unexpired forward exchange contract at marked to market and loss of Rs. 1.72 lacs (P.Y. Rs.21.06 lacs) arising out of cancellation of forward exchange contract during the year.

21 The following table shows the distribution of the Company's consolidated sales by geographical market, regardless of where the goods were produced.

22. The Company has common cost, fixed assets and liabilities for all geographical segments, hence separate figures for segment results, fixed assets/addition to fixed assets and liabilities have not been furnished.

23. Provision for current tax has been made under the normal positions of the Income Tax Act, net of MAT credit.

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Mar 31, 2014

1. General Information

Carnation Industries Limited (the Company) is a public company domiciled and incorporated under the provisions of the Indian Companies Act, 1956. The company is engaged in the manufacture of foundry based engineering goods namely Cast Iron, Ductile Iron and Mild Steel Castings predominantly for export and also for domestic market having plants at various locations in West Bengal. Its shares are listed in two stock exchanges in India (Bombay Stock Exchange Limited and The Calcutta Stock Exchange Limited).

2. OTHER NOTES

i) Estimated amount of contracts remaining to be executed on Capital Account is Rs.4.17 Lacs (Net of advance of Rs. 25.63 lacs) (Previous year Rs.4.17 lacs, net of advance Rs. 25.63 lacs).

(Rs. in Lacs) ii) Contingent liability not provided for in respect of : As at As at 31.03.2014 31.03.2013

a) Outstanding Bank Guarantee 57.33 49.33

b) Disputed Duty & Penalty under Central Excise Law 86.56 86.56

c) Disputed Vat Demand for the Financial Year 2007-08 100.13 100.13

d) Duty drawback received amounted to Rs. 27.00 lacs (Approx) (Previous year Rs.15.00 lacs) is subject to export realisation.

iii) The Company, in respect of its claim for refund of Input Tax Credit amounting to Rs.106.03 lacs for the Financial Year 2005-06 had filed a revision petition u/s 87 of the VAT Act, 2003 against the Appellate Authority''s order dt. 25/03/2011, rejecting the appeal and also filed an appeal before The West Bengal Commercial Taxes Appellate and Revisional Board for the financial year 2007-08 against the order passed by the Joint Commisioner of Sales Tax, Kolkata (South) Circle, rejecting the total claim of ITC for that year and also raised a demand for Rs.100.13 lacs.The revision petition and the appeal are still pending. Claims for the refund of Input Tax Credit in respect of other financial years are at various stages of adjudication with the Sales Tax Department The Company expects realisation of these refund claims not later than 12 months from 31st March, 2014. The company had also been advised by its lawyer that these claims were worked out and made in confirmity and compliance with the stipulated rules and procedures. During the current financial year the company has received provisional refund of Input Tax Credit amounting to constitute Rs. 39.54 lacs, Rs. 50.36 lacs and Rs. 33.08 lacs, which 75% of the amount of accepted claims for the quarter 3rd & 4th quarter of the financial year 2011-2012 and first for the financial year 2012-2013 against submission of Indemnity Bonds equivalent to the amount of claim.

iv) The company recognises overdue interest on export sales as and when the sale proceeds is realised as mutually agreed.

v) The Additional Commissioner of Central Excise, Kol-II and Haldia Commissionarate have raised two separate demands with penalty agreegating to Rs.136.56 lacs out of which Rs. 50.00 lacs was paid in the financial year 2007-08. The Company had filed Appeals against the above demands before the Commissionarate (Appeal - I & II) of Central Excise Kolkata which are still pending.

vi) Gratuity and Other Post-Employment Benefit Plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides Leave Encashment Benefit to employees, whereby unutilised leave is carried forward and eligible for encashment upon retirement / termination.

The following tables summarise the components of net benefit expense recognised in the Profit and Loss Account and amounts recognised in the Balance Sheet for the respective plans.

The discount rate should be based upon the market yields available on Government bonds at the accounting date with a term that matches that of the liabilities and the salary increase should take account of inflation, seniority, promotion and other relevant factors.

vii) In the opinion of the board, all Current Assets and Non-Current Assets have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the accounts. Balance confirmation from certain vendors are yet to be received by the company.

viii) The assets and liabilities which are expected to be realised and payable in the ordinary course of business not later than 12 months from the reporting date have been classified as current assets and current liabilities in the Balance Sheet. All other assets and liabilities have been classified as non-current.

ix) Foreign Exchange gain of Rs.94.66 lacs (Previous year gain Rs.137.88 lacs) are net of exchange gain of Rs.1.00 lacs (Previous year loss Rs.7.90 lacs) arising out of conversion of unexpired forward exchange contract at marked to market and loss of Rs. 21.06 lacs (P.Y. Rs.8.08 lacs) arising out of cancellation of forward exchange contract during the year.

xi) Provision for current tax has been made on the Book Profit of the Company under Provisions of the Minimum Alternate Tax and asset in respect thereof has not been recognised.

xv) Previous year''s figures have been regrouped / revised wherever found necessary.

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Mar 31, 2013

1. General Information

Carnation Industries Limited (the Company) is a public company domiciled and incorporated under the provisions of the Indian Companies Act, 1956. The company is engaged in the manufacture of foundry based engineering goods namely Cast Iron, Ductile Iron and Mild Steel Castings predominantly for export and also for domestic market having plants at various locations in West Bengal. Its shares are listed on two stock exchanges in India (Bombay Stock Exchange and Calcutta Stock Exchange).

(Rs. in Lacs)

i) Contingent liability not provided for in respect of : As at As at 31.03.2013 31.03.2012

a) Outstanding Bank Guarantee 49.33 49.93

b) Disputed Duty & Penalty under Central Excise Law 86.56 86.56

c) Disputed Vat Demand for the Financial Year 2007-08 100.13 100.13

d) Duty drawback received amounted to Rs. 15.00 lacs (Approx) is subject to export realization.

ii) The Company, in respect of its claim for refund of Input Tax Credit amounting to Rs.106.03 lacs for the Financial Year 2005-06 had filed a revision petition u/s 87 of the VAT Act, 2003 against the Appellate Authority''s order dt. 25/03/2011, rejecting the appeal and also filed an appeal before The West Bengal Commercial Taxes Appellate and Provisional Board for the financial year 2007-08 against the order passed by the Joint Commissioner of Sales Tax, Kolkata (South) Circle, rejecting the total claim of ITC for that year and also raised a demand for Rs.100.13 lacs. The revision petition and the appeal are still pending. Claims for the refund of Input Tax Credit in respect of other financial years are at various stages of adjudication with the Sales Tax Department .The Company expects realization of these refund claims not later than 12 months from 31st March, 2013. The company had also been advised by its lawyer that these claims were worked out and made in conformity and compliance with the stipulated rules and procedures

During the current financial year the company has received provisional refund of Input Tax Credit amounting to Rs.30.05 lacs, Rs.38.04 lacs and Rs.51.27 lacs, which constitute 75% of the amount of accepted claims for the second quarter of the financial year 2010-2011 and first two quarters for the financial year 2011-2012 against submission of Indemnity Bonds equivalent to the amount of claim.

iii) Export Incentives on Export Sales have been hitherto accounted for in the year of recognition of Export. In view of Hon''ble Supreme Court Judgement in the case of Topman Exports & also on the basis of assessments made in our case during past assessment years the company has changed the method of accounting in respect of export incentives under Focus Product Scheme and such export benefit is accounted for on the basis of claim made till the approval of the annual financial statements by the Board of Directors on actual or estimated realizable value as the case may be. As a consequence of this, current year export incentive income and profit is lower by Rs. 114.11 lacs.

iv) The Additional Commissioner of Central Excise, Kol-II and Haldia Commissionarate have raised two separate demands with penalty agreegating to Rs. 136.56 lacs out of which Rs. 50.00 lacs was paid in the financial year 2007-08. The Company had filed Appeals against the above demands before the Commissionarate (Appeal - I & II) of Central Excise Kolkata which are still pending.

v) Gratuity and Other Post-Employment Benefit Plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides Leave Encashment Benefit to employees, whereby unutilised leave is carried forward and eligible for encashment upon retirement / termination.

The following tables summaries the components of net benefit expense recognized in the Profit and Loss Account and amounts recognized in the Balance Sheet for the respective plans.

vi) In the opinion of the board, all Current Assets and Non-Current Assets have a value on realization in the ordinary course of business at least equal to the amount at which they are stated in the accounts. Balance confirmation from certain vendors are yet to be received by the company.

vii) The assets and liabilities which are expected to be realized and payable in the ordinary course of business not later than 12 months from the reporting date have been classified as current assets and current liabilities in the Balance Sheet. All other assets and liabilities have been classified as non-current.

viii) Foreign Exchange gain of Rs.137.88 lacs (Previous year loss Rs.15.08 lacs) are net of exchange loss of Rs. 7.90 lacs (Previous year Rs.50.65 lacs) arising out of conversion of unexpired forward exchange contract at marked to market and Rs. 8.08 lacs (P.Y. Rs.70.06 lacs) arising out of cancellation of forward exchange contract during the year.

The Company has common cost, fixed assets and liabilities for all geographical segments, hence separate figures for segment results, fixed assets/addition to fixed assets and liabilities have not been furnished.

ix) Provision for current tax has been made on the Book Profit of the Company under Provisions of the Minimum Alternate Tax and asset in respect thereof has not been recognized.

x) Related party disclosures and transactions:

xi) Previous year''s figures have been regrouped / revised wherever found necessary.

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Mar 31, 2012

1. General Information

Carnation Industries Limited (the Company) is a public company domiciled and incorporated under the provisions of the Indian Companies Act, 1956. The company is engaged in the manufacture of foundry based engineering goods namely Cast Iron, Ductile Iron and Mild Steel Castings predominantly for export and also for domestic market having plants at various locations in West Bengal. Its shares are listed on two stock exchanges in India (Bombay Stock Exchange and The Calcutta Stock Exchange).

a) Terms/rights attached to equity shares

The Company has only one class of equity shares having face value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

During the year ended 31 st March, 2012 the amount of per share dividend recognised as distributable to equity shareholders is Re: 0.60 (31st March, 2011: Re. 0.40). The total dividend appropriation for the year ended 31-03-2012 amounted to Rs. 24.10 lacs including corporate dividend tax of Rs. 3.36 lacs.

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. The distribution will be in proportion to the number of equity shares held by the shareholders.

2. LONG -TERM BORROWINGS From Banks

(Secured against purchase of bills, hypothecation of Stock-In-Trade, Book Debts and Receivables, Term Deposits, Equitable Mortgage of Land / Buildings owned by the Company as well as by some Directors, charge on the existing and future plant & machinery owned by the Company and personal guarantee of some Directors and guarantee by ECGC on pari-passu basis amongst the Bankers, including for short term borrowings).

3. SHORT-TERM BORROWINGS From Banks

(Secured against purchase of bills, hypothecation of Stock-In-Trade, Book Debts, and Receivables, Term Deposits, Equitable Mortgage of Land / Buildings owned by the Company as well as by some Directors, charge on the existing and future plant& machinery owned by the Company and personal guarantee of some Directors and guarantee by ECGC on pari-passu basis amongst the Bankers including for long term borrowings.)

a) In view of insufficient information from the suppliers regarding their status as Micro, Small and Medium Enterprises, the amount remaining unpaid to such undertakings could not be ascertained for separate disclosure in our accounts.

b) Charge of hypothecation over Current Assets & Raw Materials procured under letter of credit in favour of bankers has been created for letter of credit issued. Agreegate value of such letter of credit outstanding as on 31st March, 2012 is Rs.617.77 lacs. (Previous Year Rs. 512.59 lacs.)

4. OTHER NOTES

i) Estimated amount of contracts remaining to be executed on Capital Account is Rs. 182.25 lacs (Net of advance of Rs.131.75 lacs) (Previous year Rs. 103.79 lacs, net of advance Rs. 34.60 lacs.)

(Rs. in Lacs)

ii) Contingent liability not provided for in respect of :

As at As at 31.03.2012 31.03.2011

a) Outstanding Bank Guarantee 49.33 44.90

b) Disputed Duty & Penalty under Central Excise Law 86.56 86.56

c) Disputed Vat Demand for the Financial Year 2007-08 100.13 -

iii) In view of favourable judgement by the Supreme Court the company does not envisage any liability in respect of pending departmental appeals for the assessment year 2000-2001,2001 -2002 and 2002-2003 amounting to Rs. 136.99 lacs.

iv) The Company, in respect of its claim for refund of Input Tax Credit amounting to Rs.106.03 lacs for the Financial Year 2005-06 has filed a revision petition u/s 87 of the VAT Act, 2003 against the Appellate Authorityâ€Â™s order dt. 25/03/2011, rejecting the appeal. The Company has filed an appeal before the West Bengal Commercial Taxes Appellate and Revisional Board for the financial year 2007-08 against the order passed by the Joint Commisioner of Sales Tax, Kolkata (South) Circle, rejecting the total claim of ITC for that year and also raised a demand for Rs. 100.13 lacs.Claims for the refund of Input Tax Credit in respect of other financial years are at various stages of adjudication with the Sales Tax Department. The Company expects realisation of these refund claims not later than 12 months from 31st March, 2012. The Company had also been advised by its lawyer that these claims were worked out and made in confirmity and compliance with the stipulated rules and procedures. Du ring the current financial year the Company has received provisional refund of Input Tax Credit amounting to Rs.21.84 lacs and Rs.21.01 lacs, which constiitute 75% of the amount of accepted claims for the last quarter of the financial year 2009-2010 and first quarter of the financial year 2010-2011 against submission of Indemnity Bonds equivalent to the amount of claim.

v) The Additional Commissioner of Central Excise, Kol-ll and Haldia Commissionarate have raised two separate demands with penalty agreegating to Rs. 136.56 lacs out of which Rs. 50.00 lacs was paid in the financial year 2007-08. The Company had filed Appeals against the above demands before the Commissionarate (Appeal -1 & II) of Central Excise Kolkata which are still pending.

vi) Gratuity and Other Post-Employment Benefit Plans :

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides Leave Encashment Benefit to employees, whereby unutilised leave is carried forward and eligible for encashment upon retirement / termination.

The following tables summarise the components of net benefit expense recognised in the Profit and Loss Account and amounts recognised in the Balance Sheet for the respective plans.

Profit and Loss Account

Net employee benefit expense (recognised in Employee Cost)

The principal assumptions are the (1) discount rate & (2) Salary increase.

The discount rate should be based upon the market yields available on Government bonds at the accounting date with a term that matches that of the liabilities and the salary increase should take account of inflation, seniority, promotion and other relevant factors.

The above information and data are based on actuarial certification.

vii) In the opinion of the Board, all Current Assets and Non-Current Assets have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the accounts.

viii) The assets and liabilities which are expected to be realised and payable in the ordinary course of business not later than 12 months from the reporting date have been classified as current assets and current liabilities in the Balance Sheet. All other assets and liabilities have been classified as non-current.

ix) Foreign Exchange loss of Rs.15.08 lacs are net of exchange loss of Rs. 50.65 lacs arising out of conversion of unexpired forward exchange contract at marked to market and Rs.70.06 Lacs (P. Y. Rs. 3.55 lacs) arising out of cancellation of forward exchange contract during the year.

x) The following table shows the distribution of the Companyâ€Â™s consolidated sales by geographical market,regardless of where the goods were produced.

The Company has common cost, fixed assets and liabilities for all geographical segments, hence separate figures for segment results, fixed assets/addition to fixed assets and liabilities have not been furnished.

xi) Provision for current tax has been made on the Book Profit of the Company under Provisions of the Minimum Alternate Tax and asset in respect thereof has not been recognised.

xii) Related party disclosures and transactions:

Note: Based on the legal opinion obtained North American Cast Iron Products INC (NACIP) is not a related party as it is not an "Enterprise" as per the definition of the Enterprise in Rule 2(e) of the Companies Accounting Standards Rule, 2006, not requiring disclosures of transactions under Accounting Standards (AS) 18.

xv) The financial statements for the year ended 31 st March, 2012 have been prepared as per Revised Schedule VI under the Companies Act, 1956. Previous year figures have been reclassified / regrouped/rearranged to confirm to the current year's classification of Revised Schedule VI or otherwise wherever necessary.

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Mar 31, 2010

I) Estimated amount of contracts remaining to be executed on Capital Account is Rs. 53.33 Lacs (Net of advance of Rs. 14.67 lacs) (Previous year Rs.555.74 lacs, net of advance Rs. 12.90 lacs.)

ii) Contingent liability not provided for in respect of :

(Rs. in lacs)

2010 2009

a Outstanding Bank Guarantee 20.02 28.82

b. Differential Customs Duty Liability — 29.80

c. Disputed Income Tax Penalty

for the assessment year 2003-04 12.75 12.75

d. Disputed Duty & Penalty under Central Excise Law 86.56 86.56

e. Disputed Vat Demand for the Financial Year 2005-06 13.16 13.16

iii) Charge of hypothecation over Current Assets & Raw Materials procured under letter of credit in favour of bankers has been created for letter of credit issued. Agreegate value of such letter of credit outstanding as on 31st March, 2010 is Rs. 107.77 lacs. (Previous Year 200.43 lacs.)

iv) The Sales Tax Department has rejected the claim for refund of Input Tax Credit amounting to Rs. 106.03 lacs for the financial year 2005-06 vide their Order dated 25.11.2008 . However the Company has filed an appeal before the Joint Commissioner of Sales Tax, Kolkata (South). Circle for the same, which is still pending. Claims for the refund of Input Tax Credit in respect of other financial years are at various stages of adjudication with the Sales Tax Department. The Company is hopeful about their early recovery since it has been advised by its lawer that the said claims are worked out and made in conformity and compliance with the stipulated rules and procedures.

v) The Additional Commissioner of Central Excise, Kol-II and Haldia Commissionarate have raised two separate demands with penalty agreegating to Rs. 136.56 lacs out of which Rs. 50.00 lacs was paid in the financial year 2007-08. The Company has filed Appeals against the above demands before the Commissionarate (Appeal - I & II) of Central Excise, Kolkata which are still pending.

vi) Gratuity and Other Post-Employment Benefit Plans:

The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuity on departure at 15 days salary (last drawn salary) for each completed year of service.

The Company also provides Leave Encashment Benefit to employees, whereby unutilised leave is carried forward and eligible for encashment upon retirement / termination.

The following tables summarise the components of net benefit expense recognised in the Profit and Loss Account and amounts recognised in the Balance Sheet for the respective plans.

vii) In view of insufficient information from the suppliers regarding their status as Micro, Small and Medium Enterprises, the amount remaining unpaid to such undertakings could not be ascertained for separate disclosure in our accounts.

viii) In the opinion of the board, all Current Assets, Loans and Advances have a value on realisation in the ordinary course of business at least equal to the amount at which they are stated in the accounts.

ix) Since the matter relating to the resignation of Mr. Sanatan Kundu & Mr. Madan Mohan Kundu as Directors is pending in court, provision for their remuneration and other disclosure requirements will be dealt with accordingly.

x) Advance includes Rs. 14.86 lacs and Rs. 0.91 lacs due from M/s. The Salkia Industrial Works and M/s. India Casting Corporation respectively. Legal suits have been filed by the Company for the recovery of these dues which are still pending .

xi) Exchange rate difference includes exchange loss of Rs. 0.12 lacs (P.Y- Rs. 32.00 lacs) arising out of cancellation of forward contract.

xii) In the opinoin of the Board there is no loss on account of impairment of any asset during the year.

xiv) Borrowing cost capitalised during the year Rs. NIL (Previous Year Rs. 9.27 lacs).

xv) The following table shows the distribution of the Company’s consolidated sales by geographical market, regardless of where the goods were produced.

xvi) Provision for current income tax has been made on the Book Profit of the Company U/s 115JB of the Income Tax Act, 1961 at the current tax rate .

xvii) Previous years figures have been regrouped / revised wherever found necessary.