Page 184 - InterloopAnnualReport2020

NOTES TO THE UNCONSOLIDATED

FINANCIAL STATEMENTS

For the year ended June 30, 2020

The Government of Punjab imposed Punjab Infrastructure Development Levy in terms of the Punjab
Infrastructure Development Cess Act, 2015 (the Act) read with PRA Notification No.PRA/IDC/2015 dated May
16, 2016 and PRA order No.PRA/Orders.08/2015 dated May 23, 2016. The Company being aggrieved filed
writ petition vide WP No.24536 of 2016 before Honorable Lahore High Court challenging the constitutionality
of the Act. The Lahore High Court on July 28, 2016 granted interim relief for clearance of goods subject to
payment of 50% of the disputed amount and upon furnishing of a bank guarantee for the balance of 50% of
the amount.
Both the above referred cases are pending litigation before respective Honorable High Courts. The case of
Sindh High Court has been fixed after summer vacation, whereas case filed before Honorable Lahore High
Court has been adjourned without any next date.
The full amount of Infrastructure cess forms component of cost of imported items and provision recorded in
books. Bank guarantees furnished regarding imposition of infrastructure cess have been disclosed in note -
32.1 to these unconsolidated financial statements.
28.2 The investments out of provident fund have been made in accordance with the provisions of section 218 of
the Companies Act, 2017 and conditions specified thereunder.
2020 2019
Note (Rupees ‘000) (Rupees ‘000)

28.3 Workers’ profit participation fund
Opening balance 285,500 210,829
Interest on funds utilized in the Company’s business 2,815 21,425
288,315 232,254
Less: paid during the year (288,315) (232,069)
– 185
Add:
- Expense allocation for the year 112,527 285,315
- Capitalized in denim division 1,050 –
113,577 285,315
Closing balance 113,577 285,500
29. ACCRUED MARK UP
Mark up on:
Long term financing 85,523 46,259
Short term borrowings 105,613 64,224
191,136 110,483
30. SHORT TERM BORROWINGS
From banking companies – Secured
Under mark up arrangements
ERF – II 30.1 13,870,000 11,726,000
FE–25 Export 484,861 –
14,354,861 11,726,000
30.1 These are secured against first Joint Pari Passu (JPP) charge of Rs. 37,066 million (2019: 26,817.83 million)
and ranking charge of Rs. 1,334 million (2019: 2,632 million) over all present and future current assets,
further secured by 2nd ranking charge of Rs. 6,000 million (2019: Nil) over all present and future fixed assets
of the Company by all the lending banks. The total limits available to the Company for short term borrowings
from all the banks are amounting to Rs. 28,796 million (2019: 24,950 million).
Mark up is charged as;
ERF – II SBP Rate + 0.25 to 1.00 % per annum (2019: SBP rate + 0.25 to 0.30% per annum)
FE–25 Export 4% per annum as per mutually agreed treasury rate (2019: Nil)
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