1. Operating lease: Company as lessee
The Company has entered into commercial leases for office premises and warehouses. There are no contingent rents in the lease agreements. The lease terms is for 1-5 years and more than 5 year and are renewable at the mutual agreements of both the parties. There are no restrictions imposed by lease arrangements. There are no subleases. The rent expense under these agreements is Rs. 35,419,434 (March 31, 2016 : Rs. 27,463,614).
2. Segment information Business segment
The Company had identified its primary business segment as trading & manufacturing of "Automobile components"
All activities of the Company revolve around the above segment. The entire operations are governed by the same set of risks and returns. Hence it is considered as single primary business segment.
The analysis of geographical segment is based on the geographical location of the customers. The Company operates primarily in India and presence in international markets is not significant. Its business is accordingly aligned geographically, catering primarily to India.
3. The management has analyzed that no significant warranty claim is received by the Company in earlier years against the goods manufactured by the Company and further, the seller of traded goods warrants the Company that products will be free from defects in materials and workmanship under normal use and service and agrees to replace any defective parts under the conditions of standard warranty accompanying the products. Therefore, the Company has not made any provision for warranties and claims in its books of accounts for the year ended March 31, 2017.
4. The Company has closed the operations of one of its unit at Aurangabad, due to lack of customer orders and created adequate provisions in books for incidental cost incurred/expected to incur related to the closure of the said plant. The company believes that the provision carried in the books is sufficient to cover any losses in relation to the closure of the plant. The laborers had filed a legal case against the company in that regard. The District Court has, recently, issued interim relief order to maintain status quo for the said plant.
5. The Company has entered into an agreement with Lumax Ancillary Limited to sell one of its unit at kala amb in slump sale basis on April 1, 2017. Accordingly WDV of fixed assets situated at KalaAmb are disclosed under current assets as " Assets held for sale" amounting to Rs. 709,792 as at Balance sheet date.
6. Previous year’s figures have been reclassified/re-grouped wherever necessary, to confirm to this year''''s classification.