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VST Industries Limited
and re-appointment of Mr. N. Sai
as loss under the head "Income ii. Luxury Tax
Sankar are being proposed for your
from Business" and Rs.8.97 crore
approval.
was claimed as a capital loss under
As mentioned in last year's Report,
DIRECTORS' RESPONSIBILITY
the provisions of the Income Tax
a Contempt Petition has been filed
Act.
in the Hon'ble Supreme Court by
STATEMENT
the Commercial Tax Officer, on
Pursuant to Section 217(2AA) of the
The Income Tax Appellate Tribunal
behalf of the Government of
Companies (Amendment) Act, 2000
allowed the entire amount of
Andhra Pradesh against the
the Directors confirm that:
Rs.38.67 crore as a capital loss. It
Managing Director of your
Company alleging contempt of the
1. in the preparation of the Annual
may be noted that the department
Hon'ble Supreme Court's
Accounts, the applicable
had treated the entire loss as a
Speculation Loss."
accounting standards have been
judgement dated 20th January,
followed;
Your Company has preferred to file
2005, which had set aside levy of
an appeal in the matter before the
Luxury Tax. The Department has
2.
appropriate accounting policies
Hon'ble High Court of Andhra
alleged that your Company has
have been applied consistently.
Pradesh, which is still pending.
failed to pay an amount of
Judgement and estimates which
Further in connection with its
Rs.34.86 crore being the Luxury
are reasonable and prudent have
been made so as to give a true
divestment from the Foods Business
Tax collected from customers by
your Company after passing of the
and fair view of the state of affairs
in the financial year 1999-2000,
your Company had incurred a total
interim order dated 1 st June, 1999
of your Company as at the end of
but not paid to the State
the financial year and of the profit
loss of Rs.53.68 crore, of which
Government of Andhra Pradesh
of your Company for the period;
Rs.44.18 crore was claimed as a
3 .
proper and sufficient care has been
loss under the head "Income from
which is in violation of the said
judgement dated 20th January,
taken for the maintenance of
Business" and Rs.9.50 crore was
claimed as a capital loss under the
2005. An amount of Rs.29.81
adequate accounting records in
provisions of the Income Tax Act.
crore has also been claimed as
accordance with the provisions of
interest thereon @ 24% per annum.
the Companies Act, 1956 for
The Income Tax Department has
safeguarding the assets of your
disallowed the entire amount
Your Company and the Managing
Company and for preventing and
excepting Rs.5.70 crore which was
Director have both filed separate
allowed as a capital loss. The
counter affidavits strenuously
detecting fraud and other
Commissioner of Income Tax
denying that there has been any
irregularities;
(Appeals) further allowed
contempt on their part of the said
4. the Annual Accounts have been
Rs. 1 1.24 crore out of the balance
judgement of the Hon'ble Supreme
prepared on a going concern basis.
amount of Rs.47.98 crore, on
Court. The contempt case against
TAXATION
appeal before him. Your Company
the Managing Director of your
has preferred an appeal against
Company was dismissed by the
i. Income Tax
the above order and the matter is
Hon'ble Supreme Court. As far as
It may be recalled that your
now before the Income Tax
the case on the Company is
Appellate Tribunal.
concerned, there have been no
Company had diversified into
further developments during the
Financial Services Business and
Consequent to the above orders,
year
Foods Business in the early
the Income Tax Department had
nineties. Subsequently in the year
issued consequential orders under
iii. Entry Tax
1998-99, your Company incurred
Section 154 of the Income Tax Act
As mentioned in last year's Report,
a total loss of Rs.38.67 crore in
demanding Rs.28.86 crore
several High Courts in the country
the financial services business of
(revised) which was paid by your
including those of Andhra Pradesh,
which Rs.29.70 crore was claimed
Company.
Kerala, Tamilnadu and Assam
Annual Report 2009-10
Source: https://www.industrydocuments.ucsf.edu/docs/rybx0223

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