Jalpac India Ltd. के अकाउंट के लिये नोट

Mar 31, 2013

1.1 Contingent liabilities not provided for (as estimated and certified by management):

(31.03.2013) (31.03.2012) (Rs in Thousands) (Rs in Thousands)

i i) Entry Tax 690 664

ii) Sales Tax matters under appeal 16639 15834

iii) Sales tax Deemed on assessments* 71197 173671**

iv) Exise Duty Matters 14005 16042

v) Arrears of Cumulative Preference Dividend 12369 11264 (Including Corporate Dividend Tax)

vi) Provident Fund Demand 0 430

vii) Claim not acknowledged as debt (interest) 613 613

vjjj) Fiscal Penalty on advance License obligation 1304087 1304087

not fulfilled (Read with Note No. 2.4(b) below) ix) Custom Duty on EPCG obligation

not fulfilled (Read with No. 2.3 below 42052 0

*Excluding interest @ 15% p.a. from the date of order till the date of payment (amount unascertained).

** In respect of period 2005-2006, order of the concerned authorities abolishing the demand of Rs. 102300 Thousands have been received after financial year ended 31.3.2012.

1.2 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous Year: Nil )

1.3 a) Export obligation amounting to Rs. 213179 Thousands (Previous Year Rs. 211140 Thousands) under E.P.C.G.

scheme was to be fulfilled by 17.04.2011. Subsequently Company has applied for extension of the license on 19.5.2011 which has been rejected with the liberty to reapply in accordance to the BIFR order. The company has reapplied for extension suomoto on 13.05.2013. Asstt. Commissioner of Customs has directed to pay Custom Duty of Rs. 42052 thousand plus applicable interest on account of non fulfillment of export obligations & non submission of Installation Certificate in respect of EPCG licenses. As per the Foreign Trade Policy, Sick Industrial Companies are allowed for extension up to twelve years for fulfillment of export obligations. The Company has made representations before the Asstt Commissioner of Customs to keep the order in abeyance / stay pending outcome of the AAIFR proceedings (read with note no. 2.1 (ix) above and note no. 2.14 below).

b) Export obligation amounting to Rs. 5279 Thousands (Previous Year Rs. 4966 Thousands) under E.P.C.G. scheme is yet to be fulfilled by 01.02.2014. The company has executed legal undertaking/bond for Rs 1451 Thousands (Previous Years: Rs. 38251 Thousands) in respect of above EPCG licenses. Custom Duty saved and interest (including penalty) ,if any, will be accounted for on final settlement/assessment.

1.4 a) Custom duty saved amounting to Rs. 29272 Thousands out of which show cause notices of Rs.18409 thousands have been received for recovery of duty from custom department (excluding interest and penalty amount unascertained) excluding counter veiling duty on raw material consumed (previous year Rs. 26090 Thousands)on import of raw material under advance license/authorization, pending fulfillment of export obligation. The company is a Sick Industrial Company and the Foreign T rade Policy allows extension for a period of five years or more (read with note no 2.14) for fulfillment of export obligation, pending this no provision has been considered necessary by the management for custom duty saved and interest (amount of interest & penalty etc. unascertainable). Further the Company has been legally advised that considering the above and on a "Going concern concept" basis, there is no need to make any provision for customs duty saved.

b) Joint Director General of Foreign Trade has imposed fiscal penalty of Rs. 1304087 thousands on the company on account of non fulfillment of export obligations against advance licenses. As per the Foreign Trade Policy, Sick Industrial Companies are allowed extension of five years or more for fulfillment of export obligations. The Company has made representations before the Joint Director General of Foreign Trade to keep the order in abeyance / stay pending outcome of the AAIFR proceedings (read with note 2.4(a) supra and note no. 2.14 below).

c) Joint Director General of Foreign Trade has given a notice for suspension of IEC code and placing of company name in Denied Entity List. The company is taking up the matter with the authorities. (read with note 2.4(a) supra and note no. 2.14 below)

1.5 Interest on overdue bills and claims from suppliers/customers are accounted for as and when settled/ received, since it is not possible to ascertain the amount with reasonable certainty.

1.6 Liability for gratuity/leave encashment has been calculated and provided as per the AS-15 (Employee Benefits), the details in this respect are as under:

a) Defined Benefit Plan

The employees'' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

b) Defined Benefit Plan-

i) Amounts recognized as an expense and included in the Note No. 22 ''Employee Benefit Expenses'' (Read with Note 2.19) of herein below:-

Item ''Employment Benefit Expenses'' includes Rs. 728 Thousands (Previous Year Rs. 1483/- Thousands) for Gratuity and Rs. 397 Thousands (Previous Year Rs. 346 Thousands) for Leave Encashment.

ii) Defined Contribution Plans-

Amount recognized as an expense and included in the Note - 22 ''Employment Benefit Expenses'' of Profit & Loss Statement includes Rs. 1415 Thousands (Previous Year Rs. 1262 Thousands) as Contribution to Provident and other Funds.

c) The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors on long term basis. The above information is certified by the actuary.

1.7 Sales include Export Benefits Rs 609 Thousands (Previous Year Rs 602 Thousands).

1.8 Misc Expenditure includes prior period expenditure of Rs. 853 Thousands (Previous Year Rs.338 Thousands). Other income includes prior period income of Rs. 97 thousands (Previous Year NIL)

1.9 Company has received notices dt. 08.11.2011 and 16.03.2013 under section 13(2) of SARFAESI Act, 2002 from ARCIL and SBBJ respectively, lenders of the company, which is yet to be acted upon by the said lenders.

1.10 Trading in Shares of the Company has been suspended at Bombay Stock Exchange w.e.f. 24.02.2011 due to certain non compliances of Clauses of Listing Agreement. Pursuant to special resolution passed at Annual General Meeting held on 28.09.2010 the Company has filed an application for voluntary delisting on 15.03.2011 with stock exchanges at Uttar Pradesh, Kolkata, Ahmadabad & Delhi, the same is pending at the respective stock exchanges.

1.11 (a) (i) Trade Receivables include Rs.3386 Thousands (Previous Year Rs. 3386 Thousands) against which legal and/or other persuasive steps for recovery have been initiated. Since the Management is confident that the amount is good and recoverable, hence no provision has been made.

(ii) Trade Receivables over one year include overseas overdue Trade Receivables of Rs. 1028 Thousands (Previous Year Rs. 1017 Thousands) where intimation to appropriate authority/ RBI is pending.

(b) Long Terms Loans & Advances includes Rs. 2179 Thousands (Previous Year Rs.2431 Thousands) and Short Term Loans & Advances Includes Rs. 1180 Thousands (Previous Year Rs. 3711 Thousands*) against which legal and/ or other steps have been initiated for recovery. Management is confident that the amount is good and recoverable, however, adhoc provision of Rs. 504 thousands (Previous Year Rs. 435 thousands) against these loans and advances has been provided. * Including insurance claims NIL (Previous Year Rs. 2533 Thousands).

1.12 Balances of Trade Receivables, Trade Payables, Other Current Liabilities (including Statutory Dues) (read with Note no 2.5 & 2.24), certain Long Term Loans & Advances, certain Short Term Loans & Advances, Secured loans from ARCIL amounting to Rs. 153139 Thousands (Previous Year Rs. 150392 Thousands), Unapplied Interest on Secured Loans, Unsecured Loans, certain Bank Balances amounting to 6 Thousands (Previous Year Rs. 128 Thousands) , Fixed Deposits & Margin Money amounting to Rs. 18 Thousands (Previous Year Rs. 18 Thousands) and Contingent liabilities are subject to confirmation/reconciliation. Adjustments, if any, will be accounted for as and when reconciled/ confirmed. These accounts are reconciled in the usual course of business as and when transaction is made and Management is of the opinion that there will be no material impact on confirmation of balances.

1.13 In accordance with the provision of Accounting Standard on Impairment of Assets, (AS- 28), the management has not carried out assessment of assets in use. Bankers / Financial Institutions have got the assessment done, who have valued on 18.07.2011 plant & machinery and land & building at 118174 Thousands, which is under consideration of management. Considering the inherent value and business prospects related thereto, no provision at this stage is considered necessary in these accounts on account of Impairment of assets.

1.14 The accumulated losses as on 31st March 2013 (since March'' 04) are in excess of net worth. The company had been declared a Sick Industrial Company within the section 3(1)(O) of the Sick Industrial Companies (Special Provisions) Act 1985 by Hon''ble BIFR''s order dated 05.09.2006. For revival of the company, the Operating Agency (OA) SBI has submitted a TEV report and Company submitted DRS on 16.06.2009, which was not accepted to the Secured Creditors.

In the hearing held on 07.04.2010, Hon''ble BIFR asked OA (SBI), to issue advertisement for the Change of Management (COM) of the Company (which was issued on 26.05.2010) but OA had rejected the only bid filed by the Company with a co-promoter.

Further BIFR again vide its order dated 10.02.2011 directed the OA to re-issue an advertisement inviting offers for the COM by way of Take Over/ Merger/ Amalgamation/ Sale of Company as per the new guidelines. The OA had issued advertisement for bidding on 21.04.2011 and one of the clauses stated that existing promoters may submit their fully tied up Draft Revival Proposal (DRP), with or without a co-promoter, with proof of their financial resources for rehabilitation. Company filed the DRS in response to the advertisement, which was not accepted to the lenders.

Further, on the hearing held on 10.07.2012, BIFR has opined that the company should be wound up and this opinion be forwarded to concerned High Court for further action under law. Company has filed appeal before the Appellate Authority for Industrial and Financial Reconstruction (AAIFR) which is pending. In view of the above, these financial statements are prepared on "Going Concern Concept ".

1.15 (a) The company is sick company and for the reason stated in Note 2.13 and 2.14 above (read with Note No. 2.12), no provision for interest, as calculated/estimated by the management, on secured loans from certain banks and financial institution amounting to Rs 36204 Thousands for the current year (Previous year Rs. 36024 Thousands) and Rs. 235112 Thousands up to date (Previous year Rs.198908 Thousands) has been made in the accounts, the same will be accounted for as and when settled / paid. Further penal interest etc. (amount unascertained and this is to be read with Note no. 2.12 as stated above) if any, will be accounted for as and when paid. As per the directions of Hon''ble BIFR dt. 10.02.11, secured lenders were asked to inform their outstanding of compound interest as well as simple interest. ARCIL has claimed compound interest of Rs. 141008 thousands and simple interest of Rs.99296 thousands upto Mar.''13, SBI has claimed the compound interest of Rs. 114929 thousands and simple interest of Rs. 94516 thousands upto Dec 2010 & SBBJ has claimed notional interest of 37006 thousands up to 16.03.2013 , for which provision has not been made in these accounts.

(b) Due to Cash Losses and tightness of finances the company could not make payments for the various statutory dues (TDS / TCS / PF/ ESIC/ FBT/Service Tax etc.) on time/pending for payment {including provident fund and employees state insurance dues of amounting to Rs 5049 Thousands (Previous Year 3648 thousands) and TDS and others amounting to Rs 7937 Thousands (Previous Year 6786 thousands)}. The company will honour all the dues after the revival / availability of funds. Certain statutory returns/ forms are yet to be filed/revised. Penal interest and penalty (amount unascertained) if any, will be accounted for as and when the same will be paid.

(c) The company has not made provision for Sales Tax and excise duty demand amounting to Rs. 347 Thousands and Rs. 72 Thousands (Previous Year Rs. 347 Thousands and Rs. 72 Thousands ) respectively due to pending outcome of the BIFR proceedings.

1.16 (a) The Company Secretary of the company has resigned in earlier period. The company is in the process of appointing a Company Secretary. Certain secretarial records are in process of updating/compilation. Further, no Board Meeting and Audit Committee Meetings were held during the quarter ended June 2012 and Dec 2012 as per the requirement of Section 285 of the Companies Act, 1956 and Listing Agreement respectively. Further, Quarterly results from financial year 2009-10 onwards have not been published in newspapers as per the requirements of Listing Agreement.

(b) Company has initiated further steps to strengthen internal control w.r.t. purchase, sale, fixed assets and inventory however overall controls are in place. Detailed items wise full quantitative records of Stores and Work in Progress (W.I.P) are in the process of compilation/updating and records are updated as and when physical verification has been carried out. In view of necessary security arrangement/control in place, management feel that there would not be any material adjustment/shortages etc. on compilation.

(c) In the opinion of the Board of Directors, Current Assets and Loans and Advances (Long Term and Short Terms) have a value on realization in the ordinary course of business, at least equal to the amount at which they are stated.

[excluding provisions for gratuity and leave encashment, since the provision is made for the Company as a whole.] @ Remuneration amounting to Rs. 739 Thousands Paid to an Executive director from 26.10.2012 is subject to requisite approval of central government. The company is in process to file the necessary documents/application with central government in this regard.

1.17 Related Party Transactions (As certified by the Management):

(a) List of Related Parties

Key Management Personnel: -

Mr. M.K. Jalan - Managing Director

Mr. R.R. Malhotra - Executive Director.

Associate Enterprise:-

Jalan Chemical Industries Pvt. Ltd.

Sungrace Finvest Pvt. Ltd.

1.18 (i) The Company is in only one line of business namely Aluminum & Lacquer Coating.

(ii) The segment Revenue in the geographical segments considered for disclosures are as follows:

(a) Revenue inside India includes sales to customers located within India.

(b) Revenue outside India includes sales to customers located outside India.

Information about geographical segments (by location of customers)

1.19 Due to substantial carry over losses and unabsorbed depreciation, in consonance with the recognized accounting principles of prudence no deferred tax assets(net) has been created as per the Accounting Standard-22 "Accounting for Taxes on Income".

1.20 Pursuant to the provisions of Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company is in the process of compiling relevant information from its suppliers about their coverage under the said Act. Since the relevant information is not readily available, hence disclosures relating to amount unpaid as at the yearend together with interest paid/payable under this Act have not been given. However, in view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this act is not expected to be material.

1.21 Payment made to employees by way of Loan and Advances in the nature of loan where there is (as assessed by the management)

# Raw Material consumption has been computed based upon opening stock plus purchases less closing stock.

1.22 The previous year''s figures have been regrouped, rearranged and recanted wherever considered necessary.

---

Mar 31, 2012

1.1 Contingent liabilities not provided for (as estimated and certified by management):

(31.03.2012) (31.03.2011) (Rs in Thousands) (Rs in Thousands)

i i) Entry Tax 664 664

ii) Sales Tax matters under appeal 15834 16174

iii) Sales tax Deemed on assessments* 173671** 173671

iv) Exise Duty Matters 16042 16042

v) Arrears of Cumulative Preference Dividend 11264 10159 (Including Corporate Dividend Tax)

vi) Provident Fund Demand 430 430

vii) Claim not acknowledged as debt (interest) 613 613

viii) Fiscal Penalty on advance License not fulfilled 1304087 1304087

(Read with Note No. 2.4(b) below)

*Excluding interest @ 15% p.a. from the date of ordertill the date of payment (amount unascertained).

** In respect of period 2005-2006, order of the concerned authorities abolishing the demand of Rs. 102300 Thousands have been received after financial year ended 31.3.2012.

1.2 Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous Year: Nil )

1.3 a) Export obligation amounting to Rs. 211140 Thousands (Previous Year Rs. 191656 Thousands) under E.P.C.G. scheme was to be fulfilled by 17.04.2011. Subsequently Company has applied for extension of the license on 19.5.2011 which is still pending with concerned authorities.

b) Export obligation amounting to Rs. 4966 Thousands (Previous Year Rs. 4334 Thousands) under E.P.C.G. scheme is yet to be fulfilled by 01.02.2014.

The company has executed legal undertaking/bond for Rs 38251 Thousands (Previous Years: Rs. 38251 Thousands) in respect of above EPCG licenses. Custom Duty saved and interest (including penalty) if any, will be accounted for on final settlement/assessment.

1.4 (a) Custom duty saved amounting to Rs. 26090 Thousands (excluding interest and penalty amount unascertained) excluding counter veiling duty on raw material consumed (previous year Rs.30269 Thousands) on import of raw material under advance license/authorization, pending fulfillment of export obligation. The company is a Sick Industrial Company and the Foreign Trade Policy allows extension for a period of five years or more (read with note no 2.14) for fulfillment of export obligation, pending this no provision has been considered necessary bh the management for custom duty saved and interest (amount of interest & penalty etc. unascertainable). Further the Company has been legally advised that considering the above and on a "Going concern concept" basis, there is no need to make any provision for customs duty saved.

b) Joint Director General of Foreign Trade has imposed fiscal penalty of Rs. 1304087 thousands on the company on account of non fulfillment of export obligations against advance licenses. As per the Foreign Trade Policy, Sick Industrial Companies are allowed extention of five years or more for fulfillment of export obligations. The Company has made representations before the Joint Director General of Foreign Trade to keep the order in abeyance / stay pending outcome of the BIFR proceedings (read with note 2. 4(a) supra and note no. 2.14 below). However, in view of BIFR Order dt. 10.07.2012, Company is taking appropriate legal steps to challenge the said decision before appropriate authorities.

1.5 Interest on overdue bills and claims from suppliers/customers are accounted for as and when settled/ received, since it is not possible to ascertain the amount with reasonable certainty.

1.6 During the year liability for gratuity/leave encashment has been calculated and provided as per the revised AS-15 (Employee Benefits). The details in this respect are as under:

a) Defined Contribution Plan

Contribution to Defined Contribution Plan, recognized as expense for the period are as under:

Employer's Contribution to Provident Fund Rs.1371 Thousands (Previous Year Rs. 1309 Thousands).

b) Defined Benefit Plan

The employees' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

(i) Defined Benefit Plan-

Amounts recognized as an expense and included in the Note No. 23 'Employee Benefit Expenses' (Read with Note 2.19) of herein below :-

Item 'Employment Benefit Expenses' includes Rs. 1483 Thousands (Previous Year Rs. 1312/- Thousands) for Gratuity and Rs. 346 Thousands (Previous Year Rs. 288 Thousands) for Leave Encashment.

(ii) Defined Contribution Plans-

Amount recognized as an expense and included in the Note - 23 'Employment Benefit Expenses' of Profit & Loss Statement includes Rs. 1371 Thousands (Previous Year Rs. 1309 Thousands) as Contribution to Provident and other Funds.

(iii) The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors on long term basis. The above information is certified by the actuary.

1.7 Sales include Export Benefits Rs 602 Thousands (Previous Year Rs 346 Thousands).

1.8 Misc Expenditure includes prior period expenditure of Rs. 338 Thousands (Previous Year prior period expenditure Rs. 299 Thousands. Other income included Prior period income of Rs. NIL thousands ( previous year prior period income Rs 1078 thousands.)

1.9 Company has received notice dt. 08.11.2011 under section 13(2) of SARFAESI Act, 2002 from ARCIL, one of the lender, which is yet to be acted upon by the said lender.

1.10 Trading in Shares of the Company has been suspended at Bombay Stock Exchange w.e.f. 24.02.2011 due to certain non compliances of Clauses of Listing Agreement. Pursuant to special resolution passed at Annual General Meeting held on 28.09.2010 the Company has filed an application for voluntary delisting on 15.03.2011 with stock exchanges at Uttar Pradesh, Kolkata, Ahemdabad & Delhi, the same is pending at the respective stock exchanges. The securities of the company shall continue to be listed on the stock exchange having nation wide trading terminal viz Bombay Stock Exchange, Mumbai, and therefore as per the SEBI (Delisting of Equity Shares) Regulations, 2009, issued by the Securities and Exchange Board of India, no exit opportunity has been given to the shareholders of the Company.

1.11 (a) i) Trade Receivables include Rs. 3386 Thousands (Previous Year Rs. 3386 Thousands) against which legal and/ or other persuasive steps for recovery have been initiated. Since the Management is confident that the amount is good and recoverable, hence no provision has been made.

(ii) Trade Recievables over six months include overseas overdue Trade Receivables of Rs. 1017 Thousands (Previous Year Rs. 1039 Thousands) where intimation to appropriate authority/ RBI is pending.

(b) Long Terms Loans & Advances includes Rs. 2431 Thousands (Previous Year Rs. 2355 Thousands) and Short Term Loans & Advances Includes Rs. 3711 Thousands* (Previous Year Rs. 3990 Thousands*) against which legal and/ or other steps have been initiated for recovery. Since the Management is confident that the amount is good and recoverable, hence no provision has been considered necessary. * Including insurance claims Rs.2533Thousands (Previous Year Rs. 2533 Thousands).

1.12 Balances of Trade Receivables, Trade Payables, Other Current Liabilities (including Statutory Dues) & Provisions (read with Note no 2.5 & 2.24), Long Term Loans & Advances amounting to Rs. 2431 Thousands (Previous Year Rs. 2355 Thousands), Short Term Loans & Advances Rs. 3711 Thousands (Previous Year Rs. 3990 Thousands), Secured loans from ARCIL amounting to Rs. 150392 Thousands (Previous Year Rs. 144854 Thousands) , Unapplied Interest on Secured Loans, Unsecured Loans, certain Bank Balances amounting to Rs. 128 Thousands (Previous Year Rs.37 Thousands) , Fixed Deposits & Margin Money amounting to Rs. 18 Thousands (Previous Year Rs. 18 Thousands), Contingent liabilities are subject to confirmation/reconciliation. Adjustments, if any, will be accounted for as and when reconciled/ confirmed. These accounts are reconciled in the usual course of business as and when transaction is made and Management is of the opinion that there will be no material impact on confirmation of balances.

1.13 In accordance with the provision of Accounting Standard on Impairment of Assets, (AS- 28), the management has not carried out assessment of assets in use. Bankers / Financial Institutions have got the assessment done, who have valued on 18.07.2011 plant & machinery and land & building at 118174 Thousands, which is under consideration of management. Considering the inherent value and business prospects related thereto, no provision at this stage is considered necessary in these accounts on account of Impairment of assets.

1.14 The accumulated losses as on 31st March 2012 (since March' 04) are in excess of net worth. The company is a Sick Industrial Company within the section 3(1)(O) of the Sick Industrial Companies (Special Provisions) Act 1985 by Hon'ble BIFR's order dated 05.09.2006. For revival of the company, the Operating Agency (OA) SBI has submitted a TEV report and Company submitted DRS on 16.06.2009, which was not accepted to the Secured Creditors.

In the hearing held on 07.04.2010, Hon'ble BIFR asked OA (SBI), to issue advertisement for the Change of Management (COM) of the Company (which was issued on 26.05.2010) but OA had rejected the only bid filed by the Company with a co-promoter. Further BIFR again vide its order dated 10.02.2011 directed the OA to re-issue an advertisement inviting offers for the COM by way of Take Over/ Merger/ Amalgamation/ Sale of Company as per new guidelines. The OA issued advertisement for bidding on 21.04.2011. One of the clauses stated that existing promoters may submit their fully tied up Draft Revival Proposal (DRP), with or without a co-promoter, with proof of their financial resources for rehabilitation. Company filed the DRS in response to the advertisement, which was not accepted to the lenders.

Further, on the hearing held on 10.07.2012, BIFR has opined that the company should be wound up and this opinion be forwarded to concerned High Court for further action under law. Company will take appropriate steps to challenge the order as per the law before the appropriate authorities. In view of the above, these financial statements are prepared on a "Going Concern Concept ".

1.15 (a) The company is sick company and for the reason stated in Note 2.13 and 2.14 above (read with Note No. 2.12 ), no provision for interest, as calculated/estimated by the management, on secured loans from certain banks and financial institution amounting to Rs. 36024 Thousands for the current year (Previous year Rs. 35871 Thousands) and Rs. 198908 Thousands up to date (Previous year Rs.162884 Thousands) has been made in the accounts, the same will be accounted for as and when settled / paid. Further penal interest etc. (amount unascertained and this is to be read with Note no. 2.12 as stated above) if any, will be accounted for as and when paid. As per the directions of Hon'ble BIFR dt. 10.02.11, secured lenders were asked to inform their outstanding of compound interest as well as simple interest. ARCIL has claimed compound interest of Rs.107561 thousands and simple interest of Rs.81193 thousands upto Dec.'11 & SBI has claimed the outstanding interest upto 31.12.2010 as compound interest of Rs. 114929 thousands and simple interest of Rs. 94516 thousands, for which provision has not been made in the accounts. Confirmation of balance from other secured lenders are still pending.

(b) Due to Cash Losses and tightness of finances the company could not make payments for the various statutory dues (TDS / TCS / PF/ ESIC/ FBT/Service Tax etc.) on time/pending for payment {including provident fund and employees state insurance dues of amounting to Rs 3648 Thousands (Previous Year 3851 thousands) and TDS and others amounting to Rs 6786 Thousands (Previous Year 8067 thousands)}. The company will honour all the dues after the revival / availability of funds. Certain statutory returns/ forms are yet to be filed/revised. Penal interest and penalty (amount unascertained) if any, will be accounted for as and when the same will be paid.

(c) The company has not made provision for Sales Tax and excise duty demand amounting to Rs. 347 Thousands and Rs. 72 Thousands (Previous Year Rs. 417 Thousands and Rs. 72 Thousands ) respectively due to pending outcome of the BIFR proceedings.

1.16 (a) The Company Secretary of the company has resigned in earlier period. The company is in the process of appointing a Company Secretary. Certain secretarial records are in the process of updation/compilation. Further, no Board Meeting and Audit Committee Meetings were held during the quarter ended Dec 2011 and March 2012 as per the requirement of Section 285 of the Companies Act, 1956 and Listing Agreement respectively.

(b) Company has initiated further steps to strengthen internal control w.r.t. purchase, sale, fixed assets and inventory however overall controls are in place. Detailed items wise full quantitative records of Stores and Work in Progress (W.I.P) is in the process of compilation/updation and records are updated as and when physical verification has been carried out. In view of necessary security arrangement/control in place, management feel that these would not be any material adjustment/shortages etc. on compilation.

(c) In the opinion of the Board of Directors, Current Assets and Loans and Advances (Long Term and Short Terms) have a value on realization in the ordinary course of business, at least equal to the amount at which they are stated.

1.17 During the year repayment of unsecured loan of Rs. 700 Thousands (Previous Year Rs Nil Thousands) has been made.

[excluding provisions for gratuity and leave encashment, since the provision is made for the Company as a whole.] * It is inclusive of arrears amounting to Rs. 160 thousands for the period November 2009 to June 2010.

1.18 Related Party Transactions (As certified by the Management):

(a) List of Related Parties

Key Management Personnel: -

Mr. M.K. Jalan - Managing Director

Mr. R.R. Malhotra - Executive Director.

Associate Enterprise:-

Jalan Chemical Industries Pvt. Ltd.

Sungrace Finvest Pvt. Ltd.

(b) Detail of Transaction:-

i) Detail of Remuneration paid to Sh. R.R. Malhotra is given in the note no.2.19 as above.

ii) Details of loan taken from Jalan Chemical Industries Pvt. Ltd. are as below:-

1.19 Due to substantial carry over losses and unabsorbed depreciation, in consonance with the recognized accounting principles of prudence no deferred tax assets(net) has been created as per the Accounting Standard-22 "Accounting for Taxes on Income".

1.20 Pursuant to amendments to Schedule VI to Companies Act, 1956 vide Notification No. GSR 719 (E) dt. Nov. 16, 2007 and Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company is in the process of compiling relevant information from its suppliers about their coverage under the said Act. Since the relevant information is not readily available, hence disclosures relating to amount unpaid as at the year end together with interest paid/payable under this Act have not been given. However, in view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this act is not expected to be material.

1.21 The previous year's figures have been regrouped, rearranged and recasted as per Revised Schedule VI as notified by notification number S.O. 447(E) dated 28.02.2011 (as amended by F. No 2/6/2008-CL-V dated 30-3-2011).

Rights & Restrictions of Shareholders:

EQUITY SHARES

The Company has only one class of Equity Shares having face value of Rs. 10/- each (Previous Year Rs. 10/- each) in its issued,subscribed and paid up Equity share capital.On a show of hands, every holder of equity shares entitled to vote and present in person shall have one vote and upon a poll, every holder of equity shares entitled to vote and present in person or by proxy shall have one vote for every shares held by him . Each shareholder has the right in profit/surplus in proportion to amount paid up with respect of shares held.

In the event of winding up, the equity shareholders will be entitled to receive the remaining balance of assets, if any, in proportionate to their individual shareholding in the paid up equity capital of the company.

PREFERENCE SHARES

The Company has two classes of Preference Shares as mentioned above. Upon the winding-up of the company , the holders of preference shares shall be entitled to all arrears of Preferential Dividend upto the commencement of winding-up and also to be repaid the amt. of capital paid-up or credited as paid up on such Preference Shares held by them respec- tively, in priority to the Equity Shares, but shall not be entitled to any other further rights of any other holders of Shares entitled to receive preferential payment over the Equity Shares, in the event of the winding-up of the company.

a. Term Loans from Financial Institutions (ARCIL), outstanding Rs. 150392 Thounsands ( Previous Yr. Rs.144854 Thou- sands) are secured by a first mortgage of all the company's immovable properties both present and future ranking pari- passu inter-se and first charge by way of hypothecation of all the company's movables including movable plant & machinery, machinery spares, tools and 'accessories and other movables both present & future subject to prior charges created in favour of the company's bankers on inventories, book debts and other specified movables to secure borrow- ings for 'working capital requirements, and also secured by personal guarantees of a Director of the company.

b. Term Loans from Banks outstanding Rs. 47711 Thousands (Previous Yr. Rs. 47711 Thousands) are secured by pari- passu first charge on the fixed assets and pari-passu second charge on entire current assets comprising stock of raw materials,stock - in -process,stores etc. in factory, godown and in - transit and book - debts / 'receivable, both present and future .

c. Term Loan from banks outstanding Rs 22296 Thousands (Previous Yr. Rs. 22296 Thousands) and Deferred Payment Guarantee are secured by first charge on fixed assests created out of bank finance and extention of charge on current assets.

d. Loan at sl no. b & c is also secured by personal gaurantees of two directors.

e. Loans at sl no. a, b, c and CC from Bank (including interest) is secured by the pledge of shares of promoters in the company to the extent of Rs 35000 Thouands (35 lacs Equity Shares of Rs.10 each). Further Lenders have the right to convert the entire outstanding dues into Equity Shares of the Company in case of default.

f. The company has defaulted in repayment of dues to financial institution and banks. The amount overdue on account of principal is Rs. 336446 Thousands (Rs. 297023 Thousands up to 31-03-2011) consisting delays of 1 day to 2056 days and on account of interest Rs. 198908 Thousands (162884 Thousands up to 31-03-2011) consisting delays of 14 days to 2056 days.

g. This is to be read with Note No.2.12, 2.14 and 2.15 (a) of explanatory notes.

a. Cash Credit and other facilities from the Company's bankers are secured by first hypothecation of entire current assets comprising stock of raw materials, stocks-in-process, stores etc , in the factory, godown and in transit and book debts/receivables, both present and future and second charge on entire fixed assets.

b. Cash Credit is also secured by personal gaurantees of two directors. (Read with Note No. 4 (d))

c. This is to be read with Note No.2.12, 2.14 and 2.15 (a) of explanatory notes.

---

Mar 31, 2010

1. Contingent liabilities not provided for (as estimated and certified by management): 31.03.2010 31.03.2009 (Rs. In Thousands) (Rs. In Thousands)

i) Entry tax 664 664

ii) Sales Tax matters under appeal 17101 15267

iii) Excise Duty matters 16114 10712

iv) Arrears of Cumulative Preference Dividend 8973 7865

(Including Corporate Dividend Tax)

v) Provident Fund 430 Nil

vi) Service Tax 1324 Nil

vii) Claims not acknowledged as debt (Interest) 496 Nii

2. Estimated amount of contracts remaining to be executed on capital account and not provided for (net of advances) Rs. Nil (Previous Year: Nil )

3. Export obligation amounting to Rs. 196928 Thousands (Previous Year Rs. 230901 Thousands) and Rs. 4382 Thousands (Previous Year Rs. 4945Thousands) under E.P.C.G. scheme is yet to be fulfilled by 17.04.2011 and 01.02.2014 respectively. The company has executed legal undertaking/ bond for Rs 38251 Thousands (Previous Years: Rs. 38251 Thousands). Custom Duty saved and interest (including penalty) if any, will be accounted for on final assessment.

4. Custom duty saved amounting to Rs. 26929 Thousands (excluding interest and penalty amount unascertained) excluding counter veiling duty on raw material consumed (previous year Rs.26225Thousands) on import of raw material under advance license/authorization, pending fulfillment of export obligation. The company is a Sick Industrial Company and the Foreign Trade Policy allows extension period of five years or more (as per approval of BIFR) for fulfillment of export obligation, pending this no provision has been considered necessary for custom duty saved and interest (amount of interest & penalty etc. unascertainable). Further the Company has been legally advised that considering the above and on a "Going concern concept" basis, there is no need to make any provision for customs duty saved.

5. Interest on overdue bills and claims from suppliers/customers are accounted for as and when settled/ received, since it is not possible to ascertain the amount with reasonable certainty.

6. During the year liability for gratuity/leave encashment has been calculated and provided as per the revised AS-15 (Employee Benefits). The details in this respect are as under:

a) Defined Contribution Plan

Contribution to Defined Contribution Plan, recognized as expense for the period are as under: Employers Contribution to Provident Fund Rs. 1225 Thousands (Previous Year Rs. 1166 Thousands)

b) Defined Benefit Plan

The employees gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on actuarial valuation using the Projected Unit Credit Method, which recognizes each period of service as giving rise to additional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligation for leave encashment is recognized in the same manner as gratuity.

V. Investment details

All the Investments are made with Life Insurance Corporation of India.

(i) Defined Benefit Plan- Amounts recognized as an expense and included in the Schedule 12 Provisions & Schedule 16 - Employment Cost and Note 19 of herein below.

Item Employment cost includes Rs. 799 Thousands (Previous Year Rs. 420 Thousands) for Gratuity, Rs. 101 thousands (Previous Year Rs. 160 Thousands) for Leave Encashment.

(ii) Defined Contribution Plans- Amount recognized as an expense and included in the Schedule 16 - Employment Cost of Profit & Loss Account includes Rs. 1225 Thousahds (Previous Year Rs. 1166 Thousands) as Contribution to Provident and other Funds.

(iii) The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotion and other relevant factors on long term basis. The above information is certified by the actuary.

7. Sales include (a) Job Work Income Rs.1398 Thousands (Previous Year Rs. 1958 Thousands) and (b) Export Benefits Rs 675 Thousands (Previous Year Rs 3753 Thousands).

8. Prior period expenses debited to various heads of accounts amounting to Rs.2416 Thousands (Previous Year Rs. 1109 Thousands).

9. Other Income includes Claims received Rs. Nil (Previous Year Rs.87 Thousands)

10. The company has not provided the diminution in value of unquoted long term investment in Americas JIL Inc. (Book Value Rs. 432 Thousands, Previous year Rs. 432 Thousands) since in the opinion of Board such diminution in its value is temporary in the nature, considering the inherent value and nature of investment.

11. (a) Sundry debtors include Rs. 3535 Thousands (Previous Year Rs.3835 Thousands) against

which legal and/or other persuasive steps for recovery have been initiated. Since the Management is confident that the amount is good and recoverable, hence no provision has been made.

(b) Loans & Advances of Rs. 14887 Thousands (Previous Year Rs. 290 Thousands) {(including insurance claims Rs.2533 Thousands {Previous Year Rs. 2533 Thousands)} against which legal and/ or other steps have been initiated for recovery. Since the Management is confident that the amount is good and recoverable, hence no provision has been considered necessary.

12. Balances of Sundry Debtors, Sundry Creditors, Current Liabilities (including Statutory Dues) & Provisions (read with Note no 5 & 24), Loans & Advances, Secured loans, Unsecured Loans, certain Bank Balances (including Fixed Deposits & Margin Money), Contingent liabilities are subject to confirmation/reconciliation. Adjustments, if any, will be accounted for as and when reconciled/ confirmed. These accounts are reconciled in the usual course of business as and when transaction is made and Management is of the opinion that there will be no material impact on confirmation of balances.

13. In accordance with the provision of Accounting Standard on Impairment of Assets, (AS- 28), the management has not made assessment of assets in use. However considering the value and considering the business prospects related thereto, no provision is considered necessary in these accounts on account of Impairment of assets (impact unascertainable).

14. The accumulated losses as on 31st March 2010 (since March 04) are in excess of net worth. The company is a Sick Industrial Company within the section 3(1 )(0) of the Sick Industrial Companies (Special Provisions) Act 1985 by Honble BIFRs order dated 05.09.2006. For revival of the company, Operating Agency (SBI) has submitted a TEV report and Company has submitted DRS on 16.06.2009, which was not acceptable to the Secured Creditors.

In the hearing held on 7th April,2010, Honble BIFR observed that companys reference had been pending with the Board for the past six years and the company had neither submitted any fully tied up DRS, nor entered into settlement with any of its secured creditors. Hence Bench issued the directions to SBI which is acting as an Operating Agency (OA) to issue advertisement for the Change of Management (COM) of the Company. Therefore, SBI on 26th May, 2010, have issued an advertisement inviting offers for the COM by way of Take Over/ Merger/ Amalgation/ Sale of Company. One of the Clause of the advertisement states that the existing promoters could also < submit their fully tied up Draft Revival Proposal (DRP) in response to the advertisement, with or without a co-promoter, with proof of their financial resources for rehabilitation.

In view of the above, the accounts have been prepared on a "Going Concern Concept".

15. (a) The company is sick company and for the reason stated in Note 13 and 14 above no provision

for interest as estimated by the management, on secured loans from certain banks and financial institution amounting to Rs.36300 Thousands for the current year (Previous year Rs.36995 Thousands) and Rs.127013 Thousands up to date (Previous year Rs. 90713 Thousands) has been made in the accounts, the same will be accounted for as and when settled / paid. Further penal interest etc. (amount unascertained and this is to be read with note no. 12 as stated above) if any, will be accounted for as and when paid.

(b) Due to Cash Losses and tightness of finances the company could not make payments for the various statutory dues (TDS / TCS / PF/ ESIC/ FBT/Service Tax etc.) on time/pending for payment (including provident fund and employees state insurance dues of amounting to Rs 3788 Thousands and TDS and others amounting to Rs 5524 Thousands). The company will honour all the dues after the revival /availability of funds. Certain statutory returns/ forms are yet to be filed. Penal interest and penalty (amount unascertained) if any, will be accounted for as and when the same will be paid.

16. (a) The Company Secretary of the company has resigned from 09.3.2007. The company is in the

process of appointing a Company Secretary. Certain secretarial records are in the process of updation/compilation. Further, no Board Meeting and Audit Committee Meeting was held during

the quarter ended June 2009 and Sep 2009as per the requirement of Section 285 of the Companies Act,1956 and Listing Agreement respectively.

(b) Company has initiated further steps to strengthen internal control w.r.t purchase, sales, fixed assets and inventory however overall controls are in place. Detailed items wise quantitative records of Work in Progress (W.I.P) is in the processs ofmpilation/ updating as the same are updated as and when physical verification has been carried out.

(c) In the opinion of the Board of Directors, Current Assets and Loans and Advances have a value on realization in the ordinary course of business, at leastqual to the amount at which they are stated.

17. During the year repayment of unsecured loan of Rs.98 Thousands,( Previous Year Rs 182 Thousands) has been made and sale of car also been recorded.

18. Auditor Remuneration(lncJuding Service tax):

20. Related Party Transactions (As certified by the Management):

(a) List of Related Parties

Key Management personnel: -

Mr. M.K. Jalan, - Managing Director

Mr. R.R. Malhotra - Executive Director.

(b) Detail of Transaction:-

Detail of Remuneration paid to Sh. R.R. Malhotra is given in the note no.19 as above.

21. (i) The Company is in only one line of business namely Aluminum & Lacquer Coating.

(ii) The segment Revenue in the geographical segments considered for disclosures are as follows:

(a) Revenue inside India includes sales to customers located within India.

(b) Revenue outside India includes sales to customers located outside India.

Information about geographical segments (by location of customers)

22. Due to substantial carry over losses and in consonance with the recognized accounting principles of prudence no deferred tax assets (net) has been created as per the Accounting Standard-22 "Accounting for Taxes on Income".

23. Pursuant to amendments to Schedule VI to Companies Act, 1956 vide Notification No. GSR 719 (E) dt. Nov. 16,2007 and Micro, Small and Medium Enterprises Development Act, 2006, certain disclosures are required to be made relating to Micro, Small and Medium Enterprises. The Company is in the process of compiling relevant information from its suppliers about their coverage under the said Act. Since the relevant information is not readily available, hence disclosures relating to amount unpaid as at the year end together with interest paid/payable under this Act have not been given. However, in view of the management, the impact of interest, if any, that may be payable in accordance with the provisions of this act is not expected to be material.

24. Payment made to employees by way of Loan and Advances in the nature of loan where there is:-

25. Previous Years figures have been regrouped/recasted/ rearanged whereveronsidred necessary.