COMPANY MANAGEMENT AND PROJECT HISTORY & BUSINESS OF THE COMPANY The company was incorporated as private limited on 17th April, 1986, in the name of Jindal Irrigation Pvt. Limited which later became deemed public limited on 18th June, 1986 u/s 43A of the Companies Act, 1956. Subsequently name was changed to Rungta Irrigation Limited with effect from 4th April, 1994 and shareholders of the company passed a Special Resolution in Extra Ordinary General Meeting held n 09.05.94 for deleting the restriction clause under Section 3(1)(iii) of the Companies Act, 1956 in the Articles of Association of the Company and as such company became public company within the meaning of Section 3(1)(iv) of the Companies Act, 1956. The company has its registered and administrative office at 101, Pragati Tower, 26, Rajendra Place, New Delhi. The company was originally promoted by Shri S.R. Jindal and was under his management till financial year 1992-93. Thereafter during August 1993, the management of the company was taken over by the Rungta Group headed by Shri R.S. Rungta by acquiring the holding for a total consideration of Rs.126.88 lacs. The valuation of shares were arrived at the book value and further no revaluation of assets was done. At the time of take-over the following were the pending liabilities : a) Sales Tax liability imposed upon the company by the sales tax authorities amounting to Rs.86.00 lacs including penalties and interest, is under protest. On a writ filed by the company, the H'ble High Court of Rajasthan has stayed the demand and instructed the company to furnish the bank guarantee for Rs.23.00 lacs. b) Demand raised by Income Tax authorities after regular assessment for the assessment year 1989-90, 1990-91 & 1991-92 amounting to Rs.42,685/-, Rs.2,77,412 and Rs.18,118/- respectively for which appears have been preferred with the concerned authorities. The company is presently engaged in the manufacturing, designing, assembling and marketing of Aluminium/G.I./HDPE/PVC - Pipe based Sprinkler Irrigation system and rigid PVC & HDPE Pipes for water conveyance channels and other uses. The company has played a significant role so far, in acceleration of green revolution in the agro-sector of India especially in the States of Haryana, Rajasthan, Delhi, M.P. and North Eastern States. Presently the company has two manufacturing units - First Unit is at Ghaziabad in the state of U.P. for the manufacturing and assembling of Sprinklers and other components of Sprinkler Irrigation System based on Aluminium/G.I. Pipe fittings. The second unit is set up at Kala Amb, Dist. Sirmour in the State of Himachal Pradesh, a notified backward area eligible for 100% Income Tax benefit, for the manufacturing of HDPE pipes and other components and the assembling of Sprinkler Irrigation System. The Second Unit commenced its production in the month of November, 1994. In addition to the two manufacturing Units the company has its branches at Calcutta, Jaipur, Hyderabad and Bangalore and Depots at Siliguri in West Bengal, Jabalpur and Bhopal in Madhya Pradesh, Nagpur in Maharashtra, Varanasi in Uttar Pradesh, Bhiwani in Haryana, Sikar and Sayala in Rajasthan. The company was incorporated in 1986 and in the succeeding year ended on 30th June, 1987 it started the full fledged manufacturing operations producing Aluminium Irrigation System and registered a turn over of Rs.585 lacs. The company declared maiden dividend of 8% in 1987. For the year ended on 30th June, 1988 sale of the company was Rs.597 lacs and the net profit (after tax) was Rs.20 lacs. The dividend for the year remained the same as in the earlier year. The sale, net profit (after tax) and dividend for the year ended on 31st March, 1989 was Rs.622 lacs and Rs.29.76 lacs and 8% respectively. The company has not faced any labour problem since its incorporation and Labour Management relations are very cordial. The company has engaged in the production of Sprinkler Irrigation Systems based on Aluminium only. However, it was felt by management that Sprinkler Irrigation Systems made up of HDPE and Drip Irrigation System and also rigid PVC pipes having vast market potential. Further these are related area of activities and can be successfully implemented by the company. Thus the company shall have the complete range of artificial irrigation systems available in the market. As the company's brand is already established in the market and also it has strong dealership network, it will give the company an edge over its competitors. With the implementation of the proposed project the following capacities shall be created additionally. Accounting Policies A. Basis of preparation of Financial statement : (a) The financial statements have been prepared under the historical cost convention in accordance with the generally accepted accounting principle and the provisions of the Companies Act, 1956. (b) Accounting polices not specifically referred to otherwise are consistent with generally accepted accounting principles followed by the company. B. Fixed Assets and Depreciation (a) Fixed assets are stated at cost of acquisition less accumulated depreciation. (b) Advances paid for acquisition of Fixed Assets are included under capital work in progress. (c) The cost of Fixed Assets are inclusive of freight, duties and other incidental expenses incurred during construction period. (d) With regard to assets acquired under deferred payment/instalment credit schemes, the cost of the assets are capitalised while the financial charges at equated instalments have been charged to revenue. (e) Depreciation is charged on prorata basis as per the rates prescribed under schedule XIV to the Companies Act, 1956. C. Investments Investments are stated at cost. D. Inventories - Raw materials are valued at cost and Finished goods are valued at cost or market value whichever is lower. - Stores and spare parts are valued at cost. - Scrap is valued at estimated realisable value. E. Research & Development Expenses Expenditure on Research and Development is charged to revenue as and when incurred. F. Recognition of Income & Expenditure All revenues, costs, assets and liabilities are accounted for on accrual basis. Sales are net of discounts and sales tax. G. Deferred revenue expenditure Preliminary expenses are written off in equal installments over a period of ten years, as allowable under the Income Tax Act 1961. MATERIAL NOTES ON ACCOUNTS Year 1990-91, 1991-92, 1992-93 1. The company is liable to be assessed under Wealth Tax Act and the liability of it is accounted for on cash basis. Year 1993-94 1. Demand raised by Income Tax authorities after regular assessment for the Assessment Year 1989-90, 1990-91 & 1991-92 amounting to Rs.42,685.00, Rs.2,77,412.00 and Rs.18,118.00 respectively for which appeals have been preferred with the concerned authorities. 2. Sales tax liability imposed upon the company by the sales tax authorities amounting to Rs.86.00 lacs including penalties and interest, is under protest. On a writ field by company, the Hon'ble High court of Rajasthan has stayed the demand and instructed the company to furnish the bank guarantee for Rs.23 lakhs. 3. The company has changed the method providing depreciation on fixed assets from written down value method to straight line method at the rates and manner provided under schedule XIV to the Companies Act, 1956 on the assets acquired on or after 1st April, 1993. Assets acquired before 1st April, 1993 are continued to be depreciated under written down value method. Had the method of providing depreciation been adopted consistently as provided in previous years, the profit of the company would have been reduced by Rs.20,70,358.00 and the decrease in net block by Rs.20,70,358.00. 2008 - Rungta Irrigation Ltd has appointed Ms. Priya Rungta, D/o Shri. M P Rungta, as Additional Director of the Company. 2022 -The company issued rights shares of Rs. 10 in the ratio of 1.25:1 at a premium of Rs. 1 per share.