Mukunda Industrial Finance Ltd. के अकाउंट के लिये नोट

Mar 31, 2010

1. The Management has capitalized under Fixed Assets Accumulated Lease Equalisation Net of Lease adjustment Account Rs.47.01 lacs.

2. (a). A sum of Rs. 333.66 lacs included in Loans and Advances Net Investment on lease Rs. 280.37 lacs is not recoverable for which no provision is made. Consequently the loss is understated by Rs. 614.03 Lacs.

(b). Secured loans from banks is secured by assignment of hire purchase and lease agreements, lien on fixed deposits and personal guarantee of some of the present and past directors of the company. There is no operation in the accounts with ING Vysya Bank since 18th September, 2008 and the bank has filed a suit before the Debt Recovery Tribunal. The company has not provided for interest liability amounting to Rs.29.65 lacs and the same is shown under contingent liability as it is being disputed.

Subject to (a) and (b) above, the company has followed the prudential norms for income recognition, concentration of credit/investment, asset classification and provisioning in respect of non-performing assets, as per the norms prescribed by Reserve Bank of India.

3. Lease Equilisation Charge for the year on Assets Leased upto 31-03-2001 has been accounted for as per the Guidance Note (Revised) issued by the Institute of Chartered Accountants of India.

4. In the opinion of the management and based on legal opinion obtained by the Company, AS - 28: Impairment of Assets is not applicable to the Company since the Company is in the business of Equipment Leasing, Hire Purchase, Bills Discounting and ICDs which are considered as financial assets.

5. Income from operations is inclusive of overdue compensatory charges and net of rebates and discounts. The overdue compensatory charges receivable as on 31-3-2010 is Rs. 38.25 Lacs (Previous Year Rs. 38.25 Lacs).

6. Balances in Sundry debtors, hirers, lessees and other loans, advances and deposits are subject to confirmation.

7. Tax deducted at source on Income from Investments and Bank Deposits is Rs. 74,687/- (P.Y. Rs. 2,16,892/-)

8. Deposits with banks include: (a) Rs. 10.18 lacs (P.Y. Rs. 9.36 Lacs) under lien for facilities availed from the State Bank of India and (b)Rs.4.60 lacs (P.Y.Rs.4.60 lacs) against bank guarantee availed from the Karur Vysya Bank furnished to Tamilnadu Sales Tax authorities for the year 2004-05, in respect of appeal pending before the appellate authorities.

9. The Company is primarily engaged in the business of Hire Purchase Financing and Equipment Lease Financing. Since these activities are covered by the same set of Risks and Rewards, these have been considered as a single segment, which is in accordance with the guiding principle enunciated by AS-17: Segment Reporting.

10. The Company has recognized Deferred Tax Asset amounting to Rs. 269.96 lacs as per AS-22 : Accounting for Taxes on Income considering the readability of said asset against sufficient future taxable income.

The Components of Deferred Tax Asset arising out of Timing Differences are :-

Deferred Tax Asset on account of Carry Forward Losses under the Income Tax Act Rs. 331.59 lacs

Deferred Tax Liability on account of difference in WDV of Fixed Assets Rs. 61.63 Lacs

Deferred Tax Asset (Net) Rs. 269.96 Lacs

11. Contingent Liabilities:

A bank guarantee has been furnished for Rs.4.60 lacs to Tamilnadu Sales Tax Authorities towards disputed tax, surcharge and penalty.

Interest on term loan and cash credit facility availed from ING Vysya Bank amounting to Rs.29.65 lacs has not been considered in the accounts in view of the dispute and one-time settlement in progress.

Interest on delayed payments to 5TFCL Rs.34.80 lacs (Rs. 6.04 lacs) has not been considered in the accounts.

12. Related Party Disclosures as per AS - 18 issued by the Institute of Chartered Accountants of India.



(a) List of related parties Nature of relationship

(i) Mukunda Insurance Services Ltd(MIS) Associate company

(ii) Mukunda Securities Ltd(MS) Associate company

(iii) Sankranthi Agarbathi Company(SAC) Associate company



(b) Key Management Personnel(KMP)

Mr.B.R.Viswanath Setty - Chairman and Managing Director

(c) Relatives of key management personnel

Mr.B.R.Raghunath: Brother

Key Management Personnel:

Remuneration to Chairman and Managing Director- Rs. Nil (Rs.4,57,205/-) Relatives of the Key Management Personnel H.P.Finance availed: Nil. (Rs. Nil); Amount outstanding at the end of the year including future receivables; Rs.Nil (Rs.Nil).

13. AS - 21 : Consolidated Financial Statements is not applicable to the Company.

14. Sundry Debtors includes Rs. Nil (Rs.Nil) being amounts due from companies / firms in which some of the Directors of the Company are interested as Directors/Partners

15. Previous Years figures have been rearranged, regrouped and restated wherever necessary to conform to current years classification.

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Mar 31, 2009

1. Contingent Liabilities:

A bank guarantee has been furnished for Rs.4.60 lacs to Tamilnadu Sales Tax Authorities towards disputed tax, surcharge and penalty pending decision in appeal.

Interest on term loan and cash credit facility availed from ING Vysya Bank amounting to Rs. 29.65 Lacs has not been considered in the accounts in view of the dispute and one-time settlement in progress. Interest on delayed payments to STFCL Rs. 6.04 lacs has not been considered in the accounts.

2. Professional fee paid to Mr.K.R.Sreenivasulu, Vice-Chairman, Rs. 3,45,000/- for the year for which approval of the Central Government under section 309(1 )(b) of the Companies Act, 1956 is obtained.

3. AS - 21: Consolidated Financial Statements is not applicable to the Company.

4. Sundry Debtors includes Rs. Nil (Rs.1.12 lacs) being amounts due from companies /firms in which some of the Directors of the Company are interested as Directors/Partners

5. Previous Years figures have been rearranged, regrouped and restated wherever necessary to conform to current years classification.

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Mar 31, 2000

1. The Company has followed the prudential norms for income recognition, concentration of credit/investment, asset classification and provisioning in respect of non-performing assets, as per the norms prescribed by Reserve Bank of India.

2. Lease Equalisation charge for the year has been accounted on the basis of the Guidance Note ( revised ) issued by the Institute of Chartered Accountants of India.

3. Lease rentals are net of lease equalisation charge of Rs.30,72,746/- (previous year Rs. 43,98,007/-)

4. Tax deducted at source on Income on Investments and Loans is Rs. 1,47,903/- (Previous Year Rs.3,38,005/-)

5. Hire Purchase finance charges and Lease rentals are net of rebates and discounts .

6. Based on legal opinion, the Company is of the view that the Interest Tax Act is not applicable to the transactions of the Company.

7. The Company is yet to obtain possession of IVPs amounting to Rs.50,000/- from the Post Office on which interest has not been accrued. Necessary steps have been taken to obtain possession of the same.

8. The computer systems and software are Y2K compliant.

9. Consequent to the company opting for Kar Vivadh Samadhan Scheme for the Assessment Years 1 994-95 and 1 995-96, revised returns have been filed for the subsequent years. Claiming certain consequential tax benefits, pending completion of assessment proceedings and based on the writ petition before the Honourable High Court of Karnataka, no additional provisioning , if any required is ascertained and provided for.

10. Previous years figures have been rearranged or regrouped wherever necessary to conform to the current years classification.