2.16 Contingent Liabilities (1) Bank Guarantee
The Company is in the violation of Section 185 of the Companies Act, 2013 as it has provided corporate guarantee along with property to Canara Bank on behalf of Natural Herbal & Seeds to the tune of Rs.18.96 Crore to obtain the credit facilities by the sister concern. The Said firm for which corporate guarantee and property is given is under stress, however since account is not classified as NPA, no provision for contingent liability is booked.
In addition to the guarantee, company has provided one property registered in its name as collateral security to the Canara bank on behalf of Natural Herbal & Seeds.
The outcome of the above matters is dependent on future developments and final decisions by the respective authorities. The company is vigorously contesting these matters and is confident of a favorable outcome.
2.17 Acceptance of Deposit
The Company is in violation of Section 73 of the Companies Act, 2013 read together with the Companies (Acceptances of Deposits) Rules, 2014 as it has taken advances from customers amounting to Rs. 81.13 lacs having outstanding balances of more than 365 days. In terms of Rule 2(1)(xii)(a) such advances are liable to be treated as deposits reads together with section 73 of the Companies Act, 2013 hence the Company is in violation of same.
2.18 Purchase from Unregistered Parties
The company is dealing in Mentha oil which is purchased from farmers, payments for which are being made in cash. Due to the nature of business of the company, it is difficult to verify the coverage of expenditure u/s 40A(3).
2.19 During the financial year, the Company has sold Land situated at Orai, Uttar Pradesh to various persons worth Rs 157.83 Lacs, on which profit of Rs. 156.11 lac is shown in books. Since this income is exceptional and not in line with the Company primary business, hence this is shown under exceptional item.
2.20 There are several cases of GST & Income Tax against the Company, however in most of the cases either demand is not confirmed and/or appeal is filled by the Company, therefore in lack of specific figure we are unable to figure out the exact liabilities (if any) arise against the Company.
|