DCM Ltd. - Quarterly/Annual Result Disclosures and Notes dated 31 Dec 2023
Auditor and Management Disclosures and Notes for the quarterly results dated 31 Dec 2023
2.This Statement has been prepared in accordance with the Companies (Indian Accounting Standards) Rules, 2015, as amended (Ind AS), prescribed under Section 133 of the Companies Act, 2013, and other recognized accounting practices and policies to the extent applicable.
3.In view of continued situation of industrial unrest at Engineering Business Undertaking (refer as Engineering Division) of the Company, situated at Village Asron, District Shaheed Bhagat Singh Nagar (Punjab), the management of the Engineering Division has recommended to declare a lockout. The Board of Directors of the Company in their meeting held on October 21, 2019 has accordingly approved the declaration of lockout at its said Business Undertaking w.e.f. October 22, 2019.
The said lockout was opposed by the workmen of said Engineering Division before the Labour Authorities and presently the matter remained sub-judice before the labour authorities. Based on the legal advice received by the Company, the management is of the view that the present lockout is legal and justified. Therefore, the Company has not made any provision for wages pertaining to the lockout period October 22, 2019 to December 31, 2023 of the workmen aggregating to Rs. 6584 lakh out of which Rs. 210 lakh pertain to quarter ended on December 31, 2023.
4.The Company is in process of developing its 68.35 acres of land situated in the revenue state of Village Bir Hisar, Sector-23, Hisar, Haryana (referred as Hisar land). The Company has signed a joint development agreement in this regard on August 11, 2022 with a party which is subject to fulfilment of certain terms and conditions by the said party as well as receipt of regulatory approvals. In this connection, the Company has received a license no.179 of 2022 in joint development with the said party on November 10, 2022 in respect of 67.275 acres of said Hisar land (referred as Project land) under Regulation of Urban Area Act, 1975 for setting up of affordable residential plotted colony under Deen Dayal Jan Awas Yojana-2016 (referred as Project).
The Director General, Town and Country Planning, Haryana has suspended the said licensee no.179 of 2022 during the month of April 2023 taking a note that an enquiry has been initiated against the Company by Deputy Commissioner in respect of the Company’s land at Hisar.
Under the said suspension order, the licensee is directed not to carry out any development work in the Colony and also not to create another third party rights unless the said suspension order is revoked. The Company is taking appropriate action in the matter for the revocation of said suspension order.
As per the legal advice received by the Company, there are merits in the said matter of revocation of suspension of license. The management holds the view that the said suspension order of license no.179 of 2022 is likely to be revoked soon, however, the same remained pending as on date of approval of these unaudited results.
5.Pending revocation of suspension of license no.179 of 2022 by Director General, Town and Country Planning, Haryana (refer note 5 above), the advance of Rs. 5,000 lakh received under JDA has been shown under the current liabilities. Pursuant to above, the current liabilities of the Company including the said advance of Rs. 5,000 lakh under JDA, exceed the current assets by Rs. 4,090 lakh as at December 31, 2023.
The management believes that with the revocation of said suspension order of license no.179 of 2022 and infusion of liquidity by focusing /managing of its real estate operation and/or the Company’s plans of restructuring of its Engineering Business Undertaking as well as other interim measures to improve liquidity, the Company will be able to continue its operation for the foreseeable future.
Accordingly, the financial results of the Company have been prepared on a going concern basis.
6.The Company has reviewed the deferred tax asset/deferred tax liabilities on deductible/taxable temporary differences between tax base of asset and liabilities and their carrying amount for financial reporting purposes at each reporting date. However, due to continue situation of uncertainty of sufficient taxable profit to recover the accumulated losses and unused tax credits against the taxable profits in future years, deferred tax asset have not been considered in the financial results.
7.The Company holds 1,78,53,605 equity shares in Purearth Infrastructure Limited (PIL), a Joint Venture Company which constitute 16.56% holding of paid up equity share capital of PIL.
The Company has received a notice from PIL of an extra-ordinary general meeting (EGM) scheduled to be held on 20th February, 2024, to seek approval of their shareholders in the said EGM for the buy-back of upto 44,19,800 equity shares equivalent to 4.10% of shareholding of PIL at Rs. 59/- per equity share.
The Company will be eligible to tender its shareholding in PIL to the extent of 7,31,997 equity shares under the said buyback Scheme of PIL. The Company will receive not exceeding Rs.435 lakh towards the consideration for tendering the said 7,31,997 shares of PIL.
Since PIL, a Joint Venture Company, is a related party, in terms of requirements under the Companies Act and SEBI (LODR), a postal ballot notice dated 7th February 2024 has been issued by the Company to its shareholders for seeking their approval for tendering its equity shares in PIL to the extent of 7,31,997 equity shares under the said buy back scheme of PIL .
8.The figures for the previous periods have been regrouped / rearranged wherever necessary.
9.Amount mentioned as '0’ in the financial results is below rounding off threshold adopted by the Company. Adding the individual figures may therefore not always result in exact total given.
10.The above results have been reviewed by the Audit Committee and approved by the Board of Directors at its meeting held on February 13, 2024. The limited review report of the statutory auditors is being filed with the BSE Ltd and National Stock Exchange of India Ltd. For more details on the standalone results, visit Company’s website www.dcm.in and Financial Results under Corporates section of www.nseindia.com and www.bseindia.com.