Corporate Insolvency Resolution Process (CIRP) Details

  • The National Company Law Tribunal (NCLT), Chennai Bench initiated Corporate Insolvency Resolution Process (CIRP) against the company vide order dated 10th May 2023.
  • The petition was filed by Intellect Capital (Financial Creditor) under Section 9 of the Insolvency and Bankruptcy Code, 2016.
  • Mr. Sanjay Mehra (IBBI/IPA001/IP-P01818/2019-2020/12784) was appointed as Interim Resolution Professional/Resolution Professional.
  • Powers of the Board of Directors were suspended effective from the CIRP commencement date and vested with the IRP/RP under Section 17 of the Code.
  • Financial and operational creditors were called to submit claims by 24th May 2023.

Financial Performance Highlights (Standalone)

FY 2022-2023 vs FY 2021-2022 (Amount in ₹ Lakhs)

  • Gross Turnover: ₹109.87 (Previous: ₹206.30) - 46.7% decrease
  • Other Income: ₹25.56 (Previous: ₹61.86) - 58.7% decrease
  • Profit/(Loss) before Depreciation, Finance Cost, Exceptional Items and Tax: ₹171.73 (Previous: ₹231.86)
  • Depreciation: ₹13.00 (Previous: ₹14.14)
  • Finance Costs: ₹0.01 (Previous: ₹10.53)
  • Profit/(Loss) before tax: ₹(82.92) (Previous: ₹(4.76))
  • Tax Expense: ₹3.57 (Previous: ₹3.98)
  • Profit/(Loss) after tax: ₹(86.49) (Previous: ₹(8.75))
  • Earnings Per Share (Basic & Diluted): ₹(1.56) (Previous: ₹(0.16))

Key Financial Position (as at 31st March 2023)

  • Share Capital: ₹5,53,09,000 (55,30,900 equity shares of ₹10 each)
  • Reserves and Surplus: ₹(6,00,63,862)
  • Total Liabilities: ₹13,54,34,121
  • Fixed Assets: ₹5,31,64,023 (Net Block)
  • Inventories: ₹2,94,95,907
  • Trade Receivables: ₹18,32,334
  • Cash and Cash Equivalents: ₹11,29,470

Annual General Meeting Details

  • 30th AGM to be held on Saturday, 30th September 2023 at 02:30 P.M. through video conferencing/audio visual means
  • Ordinary Business: To receive, consider and adopt audited financial statements for FY ended March 31, 2023, Reports of Board of Directors and Auditors
  • Record Date for e-voting: 22nd September 2023
  • Remote e-voting period: 26th September 2023 (9 AM) to 29th September 2023 (5 PM)
  • Scrutinizer: Sulabh Jain and Associates, Practicing Company Secretaries (CP No. 18254)

Auditor's Report and Key Qualifications

N. Sankaran & Co., Chartered Accountants (Firm Reg. No. 003590S)

  • Opinion: Unmodified opinion with emphasis on going concern assumption despite CIRP initiation

Key Audit Matters:

1. Loss due to Floods: Printing plant and machinery damaged in December 2015 floods at Ekattuthangal premises. Insurance dispute with financiers ongoing, partial settlement accounted, final settlement under arbitration. Actual liability to be recognized post-settlement.

2. Loan Settlement Arrangements: Memorandum of Understanding with financial institution for settlement of ₹899.20 lakhs loan by offering Block A of constructed property at Pallikaranai after 11 months. Interest not accounted as account classified as NPA. Eventuality not occurred by balance sheet date.

Defaults in Loan Repayment (as reported in Auditor's Annexure):

  • Religare Finvest Ltd.: ₹8,99,20,339 (NPA, interest not recognized)
  • Corporation Bank: ₹1,19,33,781 (NPA)
  • Intec Ltd.: ₹2,49,91,433 (NPA, machinery damaged in floods, insurance dispute)

Statutory Dues Overdue (more than six months)

  • Service Tax: ₹17,50,431
  • Luxury Tax: ₹48,92,348

Disputed Tax Liabilities

  • Income Tax Act, 1961: ₹48,22,287 (AY 2006-07 & 2007-08, pending in High Court Chennai, includes ₹31.79 lakhs paid under protest)
  • Sales Tax Liability: ₹3,59,025

Board of Directors:

  • Guruswamy Ramamurthy
  • Usha
  • M.S. Elangovan
  • Shri PS. Ravi Shankar
  • Smt. Vijaya Raghavan
  • Kishore Kumar Ramamurthy

Bankers:

  • Corporation Bank (now Union Bank of India)
  • DBS Bank
  • Equitas Small Finance Bank
  • HDFC Bank Limited-Redsum
  • HDFC Bank Limited
  • IDFC Bank Ltd
  • Kotak Mahindra Bank
  • Oriental Bank of Commerce

Auditor:

  • N. Shankaran & Co. (Firm Registration No. 003590S)

Registered & Share Transfer Agent:

  • Cameo Corporate Services Limited, Chennai

Capital Structure Impact

  • No change in share capital during the year
  • Paid-up share capital remains at ₹5,53,09,000 (55,30,900 equity shares of ₹10 each)

Cash Flow Implications

  • Cash loss of ₹69,91,405 incurred during current financial year
  • No dividend outflow
  • Contingent liabilities may materialize upon resolution of disputes

Forward-looking Statements

Document contains standard disclaimer regarding forward-looking statements, noting they are based on management's plans and assumptions subject to risks, uncertainties and inaccurate assumptions.

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