b) Terms/Rights attached to Equity Shares

The Company has only one class of Equity Shares having a par value of Rs.10 per share. Each holder of Equity Shares is entitled to one vote per share. 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 amount. The distribution will be in proportion to the number of Equity Shares held by the shareholders.

(A) Working Capital Term Loan:

Upon implementation of the CDR Package (Refer Note 28), the overdrawn portion of the Cash Credit Accounts of the Company has been carved out into separate Working Capital Term Loans (WCTL).

(B) Funded Interest Term Loan:

Upon implementation of the CDR Package (Refer Note 28), funding of interest has been provided for: -

Interest on existing term loans for a period of 24 months from the Cut-Off Date i.e. from October 01, 2013 to

September 30, 2015;

- Interest on WCTL for a period of 24 months from the Cut-Off Date i.e. from October 01, 2013 to September 30, 2015;

- Interest on residual cash credit limit for a period of 9 months from the Cut-Off Date i.e. from October 01, 2013 to June 30, 2014;

(C) Details of security:

(i) In terms of the CDR package, Rupee Term Loans , Working Capital Term Loans, Funded Interest Term Loans and Working Capital Loan (Refer Note 7) are pooled together and secured as under:

a) First pari-passu charge on the entire Fixed Assets of the Company (excluding value of vehicles), both present and future, including equitable mortgage of factory land & building at Bishnupur (West Bengal), Jajpur (Odisha) and Haldia (West Bengal). Also, secured by way of mortgage on Freehold land at New Town, District: North 24 Parganas measuring 50 Cottahs.

b) First pari-passu charge on the entire Current Assets of the Company comprised of stock of raw materials, semi finished and finished goods and book debts, outstanding moneys, receivables, both present and future pertaining to the Company's manufacturing units/divisions at Bishnupur (West Bengal), Jajpur (Odisha) and Haldia (West Bengal) and at other Units.

c) Collateral security by equitable mortgage on Land & Building at 1/26, Vidyadhar Nagar, Jaipur, Rajasthan held in the name of Shubham Complex Pvt. Ltd., Office space measuring 835 sq. ft. located at Flat no. 21B, 4th Floor, Bowbazar, 35, C.R. Avenue, Kolkata-12, held in the name of Mr. S.K.Patni and Flat No. A-52, Block-A, 35, Dr. Abani Dutta Road, Salkia, Howrah, held in the name of Mr. Rohit Patni.

d) Pledge of 100% of the promoter's shares representing 72% of the paid up Capital of the company on pari passu basis.

e) Personal Guarantee of the Promoters - Mr. S.K.Patni, Mr. Rohit Patni and Mr. Ankit Patni.

f) Corporate Guarantee of the Group Companies - Vasupujya Enterprises Pvt. Ltd., Shubham Complex Pvt. Ltd., Poddar Mech Tech Services Pvt. Ltd., Invesco Finance Pvt. Ltd. and Suanvi Trading and Investment Co. Pvt. Ltd.

(ii) Loans against Vehicles & Equipments are secured by way of hypothecation of the underlying asset financed

(D) Terms of Repayment of Loans:

(i) Terms of Repayment of Rupee Term Loans availed for Haldia Project, 33 MVA Furnace and Stainless Steel Plant of the Company and Working Capital Term Loan :

Upon implementation of the CDR Package, the existing Rupee Term Loan amounting to Rs. 33,234.93 lacs in respect of Haldia Project, 33 MVA Furnace and Stainless Steel Project and Working Capital Term Loan are to be repaid over a period of 8 years by way of 32 structured quarterly installments commencing from December to and forming part of Financial Statements as at 31st March, 2016

NOTE 1 LONG-TERM BORROWINGS (Contd.)
31, 2015 up to September 30, 2023 as per the Repayment Schedule given below. Further, such loans carry the interest rate @ 11% p.a. linked to the Base Rate of the State Bank of India, with annual reset option with the approval of CDR-EG.

(ii) Terms of Repayment of Term Loan availed for 67.5 MVA Captive Power Plant project of the Company :

Upon implementation of the CDR Package, the Rupee Term Loan amounting to Rs. 25,699.04 lacs in respect of 67.5 MVA Captive Power Plant is to be repaid by way of 38 equal quarterly installments commencing from December 31, 2015 up to March 31, 2025. Further, the loan carries the interest rate @ 11% p.a. linked to the Base Rate of the State Bank of India, with annual reset option with the approval of CDR-EG.

(iii) Terms of Repayment of Funded Interest Term Loan :

Repayment of FITL is to be made in 18 equal quarterly installments commencing from December 31, 2015 with the last installment due on March 31, 2020. FITL carries interest @11% p.a. linked to the Base Rate of the State Bank of India, with annual reset option with the approval of CDR-EG.

(v) Pursuant to CDR Package, the Company has received unsecured loans amounting to Rs. 7280 lacs from promoters & promoter group Companies as promoter’s contribution, to be converted into equity. Subsequently, with the invocation of SDR, the said amount of Rs. 7280 lacs was allowed to be converted into equity at par. The company has since applied for in-principal approval from Stock Exchanges and the same is awaited.

(vi) Unsecured Loan from Body Corporate (Other than related parties) aggregating to Rs. 6,577.72 Lacs (P.Y. Rs. 6,487.34 Lacs) are interest free. Such loans are repayable at the option of the Company and are stated by the management to be in the nature of Long-term borrowings.

(vii) Loans against Vehicles and Equipments are repayable by way of Equated Monthly Installments subsequent to taking of such loan. The original period of such loans is 3 years.

Net Deferred Tax Asset on account of balance of Unabsorbed Depreciation and Business Loss has not been recognized as a matter of prudence.

NOTE 2 SHORT-TERM BORROWINGS

Working Capital Loans from Banks (Secured)

Rupee Loans

Other Loans and Advances

Bridge Loan from WBIDC Ltd. (against interest subsidy receivable)

- SBI Global Factors Ltd. under factoring facility secured against specific debts

(A) Details of security

The rate of interest on the working capital loans from banks is 10.3% linked to the base rate of State Bank of India. For details of security given for short term borrowings, Refer Note 4(C) above.

There are no Micro, Small and Medium Enterprises to whom the Company owes dues, which are outstanding for more than 45 days as at 31st March 2016. This information as required to be disclosed under the Micro, Small and Medium Enterprises Development Act, 2006 has been determined to the extent such parties have been identified on the basis of information available with the Company.

NOTE 3 CORPORATE DEBT RESTRUCTURING

During the year 2013-14 , at the request of the Company, the Corporate Debt Restructuring Proposal (CDR Proposal) was referred to CDR Empowered Group (CDR EG) by the consortium of lenders led by State Bank of India (SBI). The CDR Proposal as recommended by SBI was approved by CDR EG on March 24, 2014 and communicated vide Letter of Approval dated March 28, 2014, as amended / modified from time to time. Under CDR package, the Company's debts were restructured / rescheduled and additional credit facilities have been sanctioned as set out in the said Letter of Approval. The cutoff date for CDR package was September 30, 2013 and upon implementation, the financial effect thereof has been duly taken into accounts.

The CDR Package includes reliefs/measures such as reduction in interest rates, funding of interest, rearrangement of securities etc. The key features of the CDR Proposal are as follows:

(i) Repayment of Rupee Term Loans (RTL) (except term loan for Captive Power Plant of the Company) after moratorium of 2 years from the cut-off date in 32 structured quarterly installments commencing from December 31, 2015 to September 30, 2023.

(ii) Repayment of Rupee Term Loans for Captive Power Plant of the Company after moratorium of 2 years from the cutoff date in 38 structured quarterly installments commencing from December 31, 2015 to March 31, 2025.

(iii) Conversion of various irregular/outstanding/devolved financial facilities into Working Capital Term Loan ('WCTL'). Repayment of WCTL after moratorium period of 2 years from cut-off date in 32 structured quarterly installments commencing from December 31, 2015 to September 30, 2023.

(iv) Restructuring of existing fund based and non fund based financial facilities.

(v) Interest on RTL and WCTL during the moratorium period of 2 years from cut-off date and interest on Cash Credit limit for a period of 9 months from the cut-off date shall be converted to FITL. Repayment of FITL would be done in 18 equal quarterly installments commencing from December 31, 2015 to March 31, 2020.

(vi) The rate of interest on RTL, WCTL, FITL and Fund Based Working Capital Facilities shall be 11% (linked to the base rate of SBI) with the right to reset the rate of the Term loan(s) and FITL every year with the approval of CDR-EG.

(vii) Waiver of penal interest for irregularities in the Cash Credit accounts for the period from cut-off date to the date of implementation of the package.

(viii) Contribution of Rs. 5,664 lacs in the Company by the promoters in lieu of bank sacrifices and Rs. 8,577 lacs to meet the additional cost over run towards the Captive Power plant project of the Company. The contribution is to be brought initially in the form of unsecured loan by September 30, 2014 and the same is to be converted into Equity by June 30, 2015.

(ix) The CDR Package as well as the provisions of the Master Circular on Corporate Debt Restructuring issued by the Reserve Bank of India, gives a right to the CDR Lenders to get a recompense of their waivers and sacrifices made as part of the CDR Proposal. The recompense payable by the Company is contingent on various factors, the outcome of which currently is materially uncertain and hence the proportionate amount payable as recompense has been treated as a contingent liability. The aggregate present value of the outstanding sacrifice made/ to be made by CDR Lenders as per the CDR package is approximately Rs. 69,987 lacs.

NOTE 30 CONTINGENT LIABILITIES AND COMMITMENTS

(i) Contingent Liabilities not provided for in the books of accounts in respect of :

(a) Bills discounted, outstanding as on 31st March, 2016 - Rs. 189.55 Lacs (P.Y. - Rs. 697.49 Lacs)

(b) Corporate Guarantee to Indian Overseas Bank, Hongkong to secure the financial assistance to SKP Overseas Pte Ltd., a Wholly Owned Subsidiary. Amount payable by SKP Overseas Pte Ltd. to Indian Overseas Bank, Hongkong as on 31st March 2016 is USD. 2.57 Million (P.Y. USD. 3.29 Million).

(c) Right of Recompense to CDR Lenders for the relief and sacrifice extended, subject to provisions of CDR Guidelines, amounting to Rs. 69,987 lacs (Refer Note 28)

NOTE 4

The current and non-current assets, in the opinion of the management, 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. Adequate provisions have been made for all known losses and liabilities.

NOTE 5

Certain Balances of the sundry creditors, sundry debtors, unsecured loans and advances are subject to confirmation and reconciliation. The reported financials might have consequential impact once the reconciliation is completed, the quantum where of remains unascertained. Advance from Parties includes Rs. 116.04 lacs (P.Y. Rs. 74.84 lacs) being certain receipts lying under suspense account in absence of information as to the credits in the bank account.

NOTE 6 RESEARCH AND DEVELOPMENT EXPENSES

Research and Development expenses aggregating to Rs. 5.25 Lacs ( P.Y. Rs.10.53 Lacs) in the nature of revenue expenditure have been included under the appropriate account heads.

NOTE 7 EMPLOYEE BENEFITS

Disclosure pursuant to Accounting Standard- 15 (Revised) "Employee Benefits"

NOTE 8 EMPLOYEE BENEFITS (Contd.)

(b) The employees. gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determined based on the actuarial valuation using the Projected Unit Credit Method as on March 31, 2016 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.

NOTE 9

The Company has not made any remittance in foreign currencies on account of dividend during the year and does not have information as to the extent to which remittance in foreign currencies on account of dividends have been made on behalf of non - resident shareholders.

NOTE 10

The Company had entered into an agreement dated February 19, 2015, for the sale, transfer or otherwise disposal of Company's Manufacturing Unit at Jajpur, Odisha as a going concern with M/s Balasore Alloys Ltd., on slump sale basis. The long stop date in terms of the said agreement was up to March 31, 2016 which has not been renewed.

NOTE 11

The Company's Factory at Haldia (West Bengal) is temporarily suspended since July 1, 2015 on account of depressed domestic and global market conditions in steel industry, and excess procurement cost of Electricity.

NOTE 12

The Joint Lender Forum (JLF) of consortium bankers has since approved "in principle" the decision for the invocation of Strategic Debt Restructuring (SDR) in terms of RBI Guidelines and among other things is exploring the investment proposals in the Company.

NOTE 13

The operations of the Company are severely impacted by weak steel industry scenario and lack of demand for Company's finished product. Lower utilization of capacity and drop in finish goods price realization has impacted the top line as well as bottom line of the Company. The Company has incurred loss of Rs. 48,406.62 Lacs for year ended March 31, 2016. The accumulated loss as on March 31, 2016 is Rs. 80,404.93 Lacs which is in excess of the entire net worth of the company. The company has continuous support from the promoters and has put in place measures for revival and cost reduction. Considering the above initiative of the Company and given the emerging scenario of steel industry in India, the management is of view of foreseeable future about the operations of the Company and accordingly the Financial Statements have been prepared under Going Concern basis.

NOTE 14

Previous year’s figures have been reworked, regrouped, rearranged and reclassified wherever considered necessary to confirm to this year's classification. Accordingly, amounts and other disclosures for the preceding year are included as an integral part of the current year Financial Statements and are to be read in relation to amounts and other disclosures relating to the current year.

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