Notes to Accounts of Western India Cottons Ltd.

Mar 31, 2014

1. a) Based on information available with the Company regarding the status of suppliers as defined under the Micro,Small Medium Enterprises Development Act 2006 and relied upon by the auditors, there were no delays in payment and no amounts overdue and remaining unpaid to Micro, Small and Medium Enterprises on account of principal and as at the end of the year

b) Liability for purchases are subject to confirmation from the parties.

2. The period of service of all employees of the company being less than the statutory minimum required to be served for eligibility to gratuity, no provision is made in the accounts for the same

3. Depreciation has been calculated on the fixed assets of the company as per schedule XIV of the Companies Act, 1956 on the following basis.

a) Assets acquired on or before 31.03.1990 Written Down Value Method

b) Assets acquired on or after 01.04.1990 Straight Line Method Cycles depreciated at9.5(SLM )higher than the rate specified in schedule XIV:

4. Contingent Liabilities and commitments:

Contigent liabilities Nil Nil

Income tax demand for the assessment year 2011-12 disputed in appeal 12348110 Nil

Commitments:

The estimated amount of contracts remaining to be executed on capital account and not provided Nil Nil for on capital account and not provided for

5. The company suspended manufacturing operation on 14th November 2003.

6. A sum Rs 67,78,682/- was recovered during the year 2010-2011 towards the decree awarded by the sub court,Thalassery in CP (ARB) No 8 of 2005 on 21-07-2007.The appeal by KSEB disputing the award before the High Court of Kerala is pending orders.The amount released is an incohate payment and is kept under sundry creditors.

7. The Chairman cum Managing Director was re appointed for two years with effect from 9th August 2012.

No remuneration is payable to the Manging Director as per the terms of appointment.

8. No provision is made for taxation for the current year in view of unabsorbed depriciation of earlir years.

9. Figures for the previous year have been regrouped wherever necessory to conform to this year''s classification and the figures given in brackets for item No.5 (a) & (b) represent previous year''s figures''

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Mar 31, 2013

1 The company suspended manufacturing operation on 14 th November 2003.

2 A sum Rs 67,78,682/- was recovered during the year 2010-2011 towards the decree awarded by the sub court,Thalassery in CP (ARB) No 8 of 2005 on 21-07-2007.The appeal by KSEB disputing the award before the High Court of Kerala is pending orders.The amount released is incohate payment and is kept under sundry creditors.

3 The Chairman cum Managing Director was reappointed for two yearswith effect from 9th August 2012

No remuneration is payable to the Manging Director as per the terms of appointment.

4 No provision is made for taxation for the current year inview of unabsorbed depreciation and loss of earlier years carried forward and avaliable for set of against current year income. 32 Figures for the previous year have been regrouped wherever necessory to conform to this year''s classification.The figures given in brackets for item No. 7 represent previous year''s figures''

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Mar 31, 2012

1.1 Terms/rights attached to equity shares: Nil

The company has only one class of equity shares.

Each share has a paid up value of Rs10/-

Every share holder is entitled to one vote per share.

2.1 a) Based on information available with the Company regarding the status of suppliers as defined under the Micro,Small Medium Enterprises Develop- ment Act 2006 and relied upon by the auditors,there were no delays in payment and no amounts overdue and remaining unpaid to Micro,Small and Medium Enterprises on account of principal and as at the end of the year b) Liability for purchases are subject to confirmation from the parties.

3.1 The term loan from Federal Bank Ltd secured by charge on motor car was settled during the year.

The loan was repayable in equated monthly instalments.

3.2 Liability for others includes amount due to Directors 214054 242405

3.3 Liabilities for others under current liabilities includes a sum of Rs 3,10,616/- payable to GratuityTrust (Previous year Rs 3,10,616/-)

3.4 Amounts to be credited to the Invester Education and Protection Fund Nil (Previous year Nil)

4.1 The period of service of all employees of the company being less than the statutory minimumrequired to be served for eligibility to gratuity,no pro- vision is made in the accounts for the same.

Note: 1. Gross Block as on 01-04-2011 includes Rs.657,44,182/- towards revaluation of Fixed Assets carried out during 1999-2000.

2. The depreciation amount of Rs. 11,68,874/- 'includes extra depreciation on account of revaluation amounting to Rs.6,12,471 /- which is transfered to Revaluation Reserve Account The balance depreciation amounting to Rs. 5,56,403/- is charged to Profit & Loss Account in accordance with the provisions of the companies Act

3. Figures in brackets pertain to the previous year.

5.1 Profit on sale of assets in the previous year includes gain on sale of 468 cents of land and building thereon at Pappinisseri amounting to Rs 510,57,666./-

5.2 The profit of capital nature in the previous year amounting to Rs 509,14,261/ - realised on sale of land and building included in the profit on sale of assets was transferred to Capital Reserve.

6.1 Gratuity under Employee Benefits Expenses in the previous year represents additional amount paid to the Managing Director for service rendered by him up to 30th September 2005

7.1 Depreciation has been calculated on the fixed assets of the company as per schedule XIV of the Companies Act, 1956 on the following basis.

a) Assets acquired on or before 31.03.1990: Written Down Value Method

b) Assets acquired on or after 01.04.1990 : Straight Line Method

The assets Cycle depreciated at rate 9.5(SLM )higher than those specified in schedule XIV:

8 Contingent Liabilities and commitments:

Contigent liabilities Nil Nil

Commitments:

The estimated amount of contracts remaining to be executed on capital account and not provided for as on 31.03.2012 was Nil (Previous year Rs Nil)

9 The company suspended manufacturing opration on 14 th November 2003.

10 Expenditure/income relating to prior year debited/credited to the Profit and Loss account:

Expenditure Nil

Income-Sales 25710

11 A sum Rs 67,78,682/- was recovered during the year 2010-2011 towards the decree awarded by the sub court,Thalassery in CP (ARB) No 8 of 2005 on 21- 07-2007.The appeal by KSEB disputing the award before the High Court of Kerala is pending orders.The amont released as an incohate payment kept under sundry creditors.

12 The Chairman cum Managing Director was appointed with effect from 9th August 2010. No remuneration is payable to the Manging Director as per the terms of appointment.

13 The provision for taxation made in the accounts for the year 2010-11 relates to the assessment year 2011-12.The provision made is for any liability to income tax which may arise in respect of profitrealised on sale of land and building during the year.No provision is made for taxation for the current year in view of unabsorbed depreciation of earlier years.

14 Figures for the previous year have been regrouped wherever necessory to conform to this year's classification and the figures given in brackets for item No.5 (a) & (b) represent previous year's figures'

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Mar 31, 2010

1. Contingent Liabilities

a) The estimated amount of contracts remaining to be executed on capital account and not provided for as on 31.03.10 was Rs.Nil (Previous year Rs.Nil)

b) Sales tax demand not accepted by the company and under reassessment after appeal:

1998-1999 Rs 623895/-

1999-2000 Rs 411704/-

2000-2001 Rs 3858898/-

c)Damages demanded by PF Commissioner not accepted by the company and under appeal:

2003-2004 Rs 227423/-



2. The term loan from Federal Bank Ltd is secured by charge on motor car. The working capital credit facility from Indian Bank has been closed under one-time settlement schemes during the year.The term loans availed from IDBI and the working capital loans from State Bank of Travancore and Canara Bank were closed in the preceding years under one -time settlement schemes. However,the charge on assets of the Company created as security for these loans in favour of IDBI/Banks are to be released as on 31.03.2010.

3. Two Directors have given their personal guarantees to Indian Bank for the working capital facility sanctioned by the Bank.The aggregate value of such personal guarantees as on 31.03.2010, was Rs (Nil) (31.03.2009 Rs.203.9 lakh).

4. The Company has sold its machineries, except processing machineries. Hence, no disclosure of installed capacity is made.

5. Selling Expenses includes insurance premium paid on transit of goods exported Rs 8099/- (Previous Year Rs 2526/-)

6. The exchange difference arising on foreign currency transactions amounting to Rs 7194.00 (Net Credit) has been accounted under the respective revenue heads (Previous year -Net Credit Rs 115269.80)

7. Trade debtors, advances for supply of raw materials and stores and creditors for purchases are subject to confirmation from the parties.

8. Amounts to be credited to Investor Education and Protection Fund Nil (Previous year Nil)

9. The policy under the Group Gratuity Scheme with LIC has lapsed due to non payment of premiums. The liability for gratuity to employees as at 31 March 2010 is ascertained at Rs 392307/-. The liability is covered to the extent of Rs 297891/- by the balance in the Group Gratuity Fund with LIC. The balance gratuity liability amounting to Rs 94416/- is provided for in the accounts

10. The company suspended manufacturing operations on 14 November 2003.

11. As there is uncertainty of realisation of the sum of Rs 20116684.88 awarded in the second arbitration with the Kerala State Electricity Board, the amount awarded is not adjusted in the accounts as receivable from the Board as on 31 March 2010

12. Investment in shares of The Western India Cottons Employees Co-op. Consumer Stores Ltd and The Western India Cottons Employees Canteen having value in aggregate of Rs 3500/- were found to be not realisable and hence, written off in the accounts for the year.

13. Liabilities for Others under current Liabilities include a sum of Rs 310616.00 payable to Gratuity Trust

14. The secured loans from Indian Bank were closed during the year under One Time Settlement agreement with the bank. The remission obtained on the principal amount and interest in respect of these loans are transferred and credited to the Profit and Loss Account. A sum of Rs 66,72,358.59 equivalent to the principal amount waived in respect of the loan is transferred to Capital Reserve from the Profit and Loss Account.

Diluted earnings per share is not calculated and disclosed as there are no dilutive potential equity shares.

15. Miscellaneous income includes advace received for sale of assets amounting to Rs 2,00,000/- forfeited.

16. Rates,taxes and licence fees includes :

a)amount of cenvat credit claimed against Central Excise Duty liability in earlier years but not allowed aggregating to Rs 5,58,133/- paid/adjusted.

b)amount of cenvat credit on capital goods and materials carried forward in the accounts in previous years not realisable amounting to Rs 3,27,643/-

c)amount of sales tax for the years 2003-04 and 2004-05 payable on settlement of dispute amounting to Rs 6,34,086/-

17. Amounts are rounded off to nearest rupee.

18. Figures for the previous year have been regrouped wherever necessary to conform to this years classification and the figures given in brackets for item No.5 (a) & (b) represent previous years figures.