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Directors Report of H P Cotton Textiles Mills Ltd.

Mar 31, 2015

Dear Shareholders,

The Directors have pleasure in presenting to you, the Thirty Fourth Annual Report on the activities of your Company together with the Audited Annual Accounts for the financial year ended 31st March, 2015.

FINANCIAL HIGHLIGHTS

The financial results of the Company for the year under review are compared below with the previous year's results for your consideration.

(Rs. In Lacs)

Particulars Year ended Year ended 31.03.15 31.03.14

Sales and other Income 9212 9798

Profit before financial charges and depreciation 636 908

Financial charges (189) (203)

Profit before depreciation 447 705

Depreciation (126) (133)

Profit before tax 321 572

Prior year adjustment - 4

Profit before Tax 321 576

Less: Provision for Tax

- Current Tax (140) (204)

- Deferred Tax 16 26 Profit after Tax 197 398

Basic and Diluted Earnings Per Share (Rs.) 5.17 10.44

Dividend Recommended Rs. /Share 1 1

Dividend Recommended (%) 10 10

OPERATIONAL PERFORMANCE:

The total sale of the company for the year was Rs. 9180 lacs as compared to the Rs. 9757 lacs in the preceding financial year. The exports of the Company increased from Rs. 6603 lacs to Rs. 6915 lacs, showing an increase of 4.73% over the preceding financial year. During the year under review, Company has earned profit before financial charges and depreciation of Rs. 636 lacs as against Rs. 908 lacs in the preceding financial year and profit after tax of Rs.197 lacs as against Rs. 398 lacs in the preceding financial year.

Due to tough market condition and excessive competition, company's turnover in terms of value has decreased at a marginal 6% during the year under review. Similarly the profit after tax has reduced due to unprecedented high level of raw material prices throughout the year.

APPROPRIATIONS:

Reserves

Out of the profits of the Company, a sum of Rs. 50 lacs has been transferred to the General Reserves during the year and total reserves and surplus of the Company are Rs. 1343 lacs (Including Share Premium) as on 31st March, 2015.

Dividend

Your Directors are pleased to recommend for your consideration and approval dividend @ 10% for the financial year 2014-15 i.e. Rs. 1/- per equity share of Rs.10/- each. The dividend if approved at ensuing Annual General Meeting will absorb Rs. 44.58 lacs including corporate dividend tax amounting to Rs. 6.48 lacs. The dividend in respect of equity shares; if declared at the meeting, will be paid to those members whose name will appear on the Company's Register of Members on 16th September, 2015; in respect of the shares held in dematerialized form, the dividend will be paid to members whose names are furnished by National Security Depository Limited and Central Depository Services (India) Limited as beneficial owners as on that date.

MEETINGS OF THE BOARD:

Seven meetings of the Board of Directors were held during the year. The details of the Board meeting and attendance of directors are provided in the report on Corporate Governance, which forms part of this Annual Report.

COMPOSITION OF AUDIT COMMITTEE:

The Audit Committee comprises Non- executive Independent Directors namely Shri Parshotam Das Agarwal (Chairman), Shri Bibhuti Charan Talukdar, Shri Anil Agarwalla, Shri Mohan Lal Jain as other members. Further details are provided in the Report on Corporate Governance, which forms a part of this Annual Report.

QUALITY MANAGEMENT SYSTEM

The company continues to lay emphasis on excellence in quality and services and is committed to total customer satisfaction. The high quality of the company products is reflected in the company ability to export its product in quality conscious world markets. The company continues to be on a mission to provide customer with products that can match with international standards and will surpass their expectations.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

The company has not given any loans or guarantees covered under the provision of section 186 of Companies Act, 2013.

The company has not made any investment during the year.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS/ COURTS, IF ANY

There are no significant material orders passed by the regulators/ courts which would impact the going concern status of your company and its future operations.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY

The Company has adequate Internal Control systems in all areas of operations commensurate with the size of the operation. Your Company has an adequate and effective internal control system to ensure that assets and interests of the Company are safeguarded and reliability of accounting data and accuracy are ensured with proper checks and balances. The scope and authority of internal audit function is defined in the internal audit manual.

The Internal Control system is improved and modified continuously to meet the changes in business Conditions, statutory and accounting requirements. The Audit Committee of the Board of Directors, Statutory Auditors and the business heads are periodically apprised of the internal audit findings and the corrective actions taken. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal controls systems and suggests improvements for strengthening them.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

As part of its initiative under "Corporate Social Responsibility" (CSR), the company has contributed funds for the schemes of eradicating hunger and poverty, promotion of education and medical aid. The contribution in this regard has been made to the entity which is undertaking these schemes.

The Annual Report on CSR activities is annexed herewith as 'Annexure -A' to Board's report.

HUMAN RESOURCES AND SAFETY OF WORKERS

Human capital is the most valuable resource of the organization, Development of human capital has always been thrust area of the Company. The success of any business lies under the qualified, trained & motivated Human Resources; industrial relations are geared at developing and aligning the operatives to the overall goal of the organization. Your Company firmly believes that a dedicated workforce constitute the primary source of sustainable competitive advantage.

Accordingly, human resources development continues to receive focused attention. Company takes adequate steps for maintaining safety and healthy environment for the workers. During the year under review, Industrial relations continued to be cordial and satisfactory. Company has enjoyed cordial relationship with workers and employees at all levels.

PARTICULAR OF EMPLOYEES

No employee was in receipt of remuneration equal to or exceeding Rs. 60 lacs per annum, if employed for the full year or exceeding Rs.5 lacs per month if employed for part of the year.

Therefore, statement showing particulars of the employees as required under Section 197 (12) of the Companies Act 2013 read with the Rule 5(2) and 5(3) of the Companies (Appointment and remuneration of managerial personnel) Rules, 2014 as amended, is not applicable.

The information required pursuant to section 197 read with Rule 5 (1) of Companies (Appointment and remuneration of managerial personnel) Rules, 2014, in respect of employees of the company, will be provided upon request. In terms of section 136 of the Act the Reports and accounts are being sent to the members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the members at the registered office of the company during business hours on working days of the company upto the date of ensuing Annual general meeting. If any member is interested in inspecting the same, such members may write to the company secretary in advance.

ENVIRONMENT AND POLLUTION CONTROL

The Company is conscious of the importance of environmentally clean and safe operations. The company's policy is the conduct of all operations in a manner to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

SUBSIDIARY COMPANIES

The company does not have any subsidiary.

CHANGES IN BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Board of Directors:

Shri Kailash Kumar Agarwal (DIN- 00063470) is liable to retire by rotation and being eligible, has offered himself for re- appointment. The Company had, pursuant to the provisions of clause 49 of the Listing Agreements entered with the Stock Exchanges and Pursuant to the provisions of section 149 of the New Companies Act 2013, appointed Shri Bibhuti Charan Talukdar, Shri Parshotam Das Agarwal, Shri Anil Agarwalla and Shri Mohan Lal Jain, as Independent Directors, in the last A.G.M. held in September 2014, to hold office for 5 (five) consecutive years i.e. From 26th September, 2014 to 25th September, 2019. Therefore, these are not liable for retirement by rotation.

Pursuant to the provision of section 149 and section 161 of Companies Act, 2013 company had appointed Smt. Nanita Agarwal as additional director on 31.03.2015 who submitted her resignation on 29/05/2015 which was accepted by the board.

Company has appointed Smt. Ritu Bansal (DIN-03619069) as additional director on 29/05/2015 who holds office upto the date of ensuing Annual General Meeting and being eligible offers herself for the appointment as an independent director.

The Board considers that the appointment of Smt. Ritu Bansal as a member of the board would be beneficial for the company. It is proposed to appoint Smt. Ritu Bansal as an independent director under section 149 of the act and clause 49 of the listing agreement, not liable to retire by rotation, for a period of five consecutive years from the date of this Annual General Meeting to September 23, 2020.

The company has also received declaration from Smt. Ritu Bansal that she meets the criteria of independence as prescribed under section 149(6) and clause 49 of the listing agreement.

Key Managerial Personnel:

Pursuant to section 203 of the Companies Act, 2013, Shri Raj Kumar Agarwal (Chairman), Shri Ashok Kumar Agarwal (Dy Managing Director), Shri Kailash Kumar Agarwal (Dy Managing Director), Shri. Ankur Goyal (Chief Financial Officer), Shri Vishesh Chugh (Chief Financial Officer), Ms. Priyanka Singal (Company Secretary) and Shri Manish Singla (Company Secretary) were designated as Key Managerial Personnel of the company.

Shri Ankur Goyal (Chief Financial Officer) submitted his resignation on 19.11.2014 which was accepted by the board with immediate effect.

Ms. Priyanka Singal (Company Secretary) has resigned with effect from 30.11.2014.

Shri Vishesh Kumar Chugh (Chief Financial Officer) submitted his resignation on 27.05.2015, which was considered by the Board in their meeting held on 29.05.2015 and decided to relieve with effect from 26.06.2015.

Shri Manish Singla (Company Secretary) submitted his resignation on 28.05.2015, which was considered by the Board in their meeting held on 29.05.2015 and decided to relieve with effect from 27.06.2015.

PERFORMANCE EVALUATION OF INDEPENDENT DIRECTORS

The Board has formulated a questionnaire for performance Evaluation of Independent Directors. The questionnaire has among others basically captured the following points:

- Key attributes of the Independent Director

- Level and quality of participation in the Board and Committee Meetings

- Inputs provided by the Independent Director based on his knowledge, skills and experience

- Independence in Judgment

- Knowledge of Company's Business.

The Board of Directors had in their meeting held on February 12, 2015 evaluated the performance of Sh. Parshotam Das Agarwal, Sh. B.C. Talukdar, Sh. Anil Agarwalla and Sh. Mohan Lal Jain Independent Directors of the Company and has determined to continue with the term of appointment of the Independent Directors.

Sh. Parshotam Das Agarwal, Sh. B.C. Talukdar , Sh. Anil Agarwalla and Sh. Mohan Lal Jain Independent Directors, have furnished a declaration that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act,2013.

SEPARATE MEETING OF THE INDEPENDENT DIRECTORS

The Independent Directors held a Meeting on January 25, 2015 without the attendance of Non-Independent Directors and Members of Management. All the Independent Directors except Anil Agarwalla were present at such meeting and at the Meeting they have:

i. Reviewed the performance of non-independent directors and the Board as a whole;

ii. Assessed the quality, quantity and timeliness of flow of information between the Company Management and the Board that is necessary for the Board to effectively and reasonably perform their duties.

The Present Independent Directors holds a unanimous opinion that the Non-Independent Directors including the Deputy Managing Director bring to the Board constructive knowledge in their respective field. All the Directors effectively participate and interact in the Meeting. The information flow between the Company's Management and the Board is satisfactory.

TRAINING OF INDEPENDENT DIRECTORS

The company shall provide suitable training to independent directors to familiarize them with the company, their roles, rights, responsibilities in the company, nature of the industry in which the company operates, business model of the company, etc.

CODE OF CONDUCT:

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings / behaviors of any form and the Board has laid down the directives to counter such acts. The code laid down by the Board is known as "code of business conduct".

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and the designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practices and in dealing with stakeholders.

The Code also lays down that Board members and Senior Managers of the company shall ensure compliance with SEBI (Prohibition of Insider Trading) Regulations, 1992 as also other regulation as may be applicable to them from time to time.

All the Board Members and the Senior Management personnel have confirmed compliance with the Code. All Management Staff were given appropriate training in this regard.

COMMITTEES OF THE BOARD

The details of the Committees of the Board constituted under the Companies Act, 2013 and Listing Agreements are given in the Corporate Governance Report forming part of this Report.

AUDITORS AND AUDIT REPORT

Pursuant to the provision of section 139 of company act, 2013 M/s A.K. Associates, Chartered Accountants, Independent Auditors of the Company were appointed in the last A.G.M. held in September 2014 to hold office for 3 (three) consecutive years i.e. for a term upto the conclusion of the 36th Annual General Meeting. During the year under review, the auditor need not to be routed as they have not completed the tenure of 3 (three) years. Your director request that the appointment of M/s A.K. Associates, the company's Auditors needs to be ratified at their Annual General Meeting and being eligible offer themselves for re- appointment. The company has received a certificate from the auditor to the effect that their re- appointment if made, would be in accordance with the provisions of section 141 of Companies Act, 2013.

The observations of the auditors in their audit report are self explanatory.

SECRETARIAL AUDIT

Pursuant to the provisions of section 204 of Companies Act, 2013 and the companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the company has appointed Anju Jain, a Company Secretary in practice to undertake the secretarial audit of the company.

SECRETARIAL AUDIT REPORT

As required U/s 204(1) of Companies Act 2013 the company has obtained a secretarial audit report. The Secretarial Audit report for the Financial Year ended March 31st, 2015, is annexed herewith marked as "Annexure B to Board's Report", which is self explanatory and needs no comments. The Secretarial Audit Report does not contain any qualification, reservation or adverse remarks.

COST AUDITORS

Ministry of Corporate Affairs has issued a notification dated 31.12.2014 to make amendment in the Companies (Cost records and audit) Rules, 2014 that -

"Textile Company shall get its Cost record audited in accordance with these rules if the overall annual turnover of the company from all its products and services during the immediately preceding financial year is Rs. 100 Crore or more and the aggregate turnover of the individual product or products or service or services for which cost record required to be maintained under Rule 3 is Rs. 35 Crore or more".

As the company's annual turnover from all its products in the preceding financial year is less than Rs. 100 Crore so company is not required to get its cost record audited.

EXTRACT OF ANNUAL RETURN

The extract of the annual return in Form MGT-9 is annexed herewith as "Annexure C to Board's Report"

BUSINESS RISK MANAGEMENT

Pursuant to Section 134 (3) (n) of Companies Act 2013 and Clause 49 of listing agreement, the company has constituted a Business Risk Management committee. The Details of committee and its terms of reference are set out in the corporate governance report forming part of boards report.

At present the company has not identified any element of risk which may threaten the existence of company.

PARTICULARS OF CONTRACT OR ARRANGEMENTS MADE WITH RELATED PARTY

Particulars of contract or arrangements made with related parties referred to in section 188(1) of the Companies Act,2013, in the prescribed form AOC -2 , is appended as "Annexure- D to Board's Report".

CORPORATE GOVERNANCE

Company has complied with the requirements of Corporate Governance through constitution and Reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). No complaint/ query from any of the shareholder is pending to be resolved by the Company or the RTA.

LISTING OF SHARES

Company's shares are listed on Delhi Stock Exchange & Bombay Stock Exchange.

FIXED DEPOSITS

The Company has not accepted / renewed any deposits from the public / members during the year under review.

CASH FLOW

In conformity with the provisions of Clause 32 of the Listing Agreement the Cash Flow Statement for the year ended 31.03.2015 is annexed hereto.

MATERIAL CHANGES AND COMMITMENT AFFECTING FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitment affecting financial position of the company which have occurred between the end of the financial year of the company i.e. 31st March, 2015 and the date of the Director's Report.

PUBLICATION OF FINANCIAL RESULTS

In conformity with the provisions of Clause 41 of the Listing Agreement the Company has published unaudited financial results for the quarter ended 30th June 2014; 30th Sept. 2014; 31st December 2014 and audited financial result for the quarter/ year ended on 31st March 2015. The summarized results are published in Business Standard (English), Delhi & Aaj Samaj (Hindi), Hisar.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGAE EARNINGS/ OUT GO

The information required under Section 134(3) (m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014 is provided as follows and forms part of this report.

a) Conservation of Energy:

a) Company ensures that the manufacturing operations are conducted in the manner whereby optimum utilization and maximum possible savings of energy is achieved.

b) No specific investment has been made in reduction in energy consumption.

c) As the impact of measures taken for conservation and optimum utilization of energy are not quantitative, its impact on cost cannot be stated accurately.

b) Technology Absorption:

Company's products are manufactured by using in-house Technology and no outside technology is being used for manufacturing activities. Therefore no technology absorption is required. The Company constantly strives for maintenance and improvement in quality of its products and Research & Development activities are directed to achieve the aforesaid goal.

DIRECTORS RESPONSIBILITY STATEMENT

In terms of Section 134(5) of the companies Act, 2013, the directors state that:

1. That in the preparation of annual accounts, applicable accounting standards had been followed along with proper explanations relating to material departures, if any;

2. That the Directors had selected appropriate accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

3. That the Directors had taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, if any,

4. That the Directors had prepared the annual accounts for the financial year ended 31st March, 2015 on a going concern basis.

5. That the Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

6. That the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

VIGIL MECHANISM / WHISTLE BLOWER POLICY:

The Company has a vigil mechanism named Whistle Blower Policy to deal with instances of unethical behavior, actual or suspected fraud or violation of the company's code of conduct.

In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to the high standards of Corporate Governance and stakeholder responsibility.

Protected disclosure can be made by a whistle blower through an e-mail or a letter in writing to the vigilance and ethics officer or to the chairman of the audit committee.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION, AND REDRESSAL) ACT, 2013

The company has in place an anti sexual harassment policy in line with the requirements of THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION, AND REDRESSAL) ACT, 2013. All the employees (permanent, contractual, temporary, trainees) are covered under this policy. During the year under review, there were no cases fled pursuant to this act.

ACKNOWLEDGEMENTS

The Directors place on record their thanks and appreciation to all workers, staff members, executives and business associates for their co-operation and contribution to the operations of the company. The Directors are thankful to the Bankers, Financial Institutions for their continued support to the company. The Directors also place on record their sincere thanks to the shareholders for their continued support, coperation and confidence in the Management of the Company.

For and on behalf of the

Board of Directors

Place: New Delhi Raj Kumar Agarwal

Dated: 13.08.2015 Chairman

(DIN: 02950710)


Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting to you, the Thirty Third Annual Report on the activities of your Company along with the Audited Annual Accounts for the financial year ended 31st March, 2014.

FINANCIAL HIGHLIGHTS

The financial results of the Company for the year under review are compared below with the previous year''s results for your consideration.

(Rs. In Lacs)

Particulars Year ended Year ended 31.03.14 31.03.13

Sales and other lncome 9798 8664

Profit before financial charges and depreciation 908 898

Financial charges (203) (242)

Profit before depreciation 705 656

Depreciation (133) (131)

Profit before tax 572 525

Prior year adjustment 4 10

Profit before Tax 576 535

Less: Provision for Tax

* Current Tax (including 1 lac for earlier year) (204) (195)

* Deferred Tax 26 (1)

Profit after Tax 398 339

Basic and Diluted Earning Per Share (Rs.) 10.44 8.89

Dividend Recommended Rs. /Share 1 1

Dividend Recommended (%) 10 10

OPERATIONAL PERFORMANCE:

The total sale of the company for the year was 7 9757 lacs as compared to the 7 8625 lacs in the preceding financial year. The exports of the Company increased from 7 5965 lacs to 7 6603 lacs, showing an increase of 10.69% over the preceding financial year. During the year under review, Company has earned profit before financial charges and depreciation of 7 908 lacs as against 7 898 lacs in the preceding financial year and profit after tax of 7 398 lacs as against 7 339 lacs in the preceding financial year.

APPROPRIATIONS:

Reserves

Out of the profits of the Company, a sum of 7 50 lacs has been transferred to the General Reserves during the year and total reserves and surplus of the Company are 7 1382 lacs (Including Share Premium) as on 31 st March, 2014.

Dividend

Your Directors are pleased to recommend for your consideration and approval dividend @ 10% for the financial year 2013-14 i.e. 7 1/- per equity share of 7 10/- each. The dividend if approved at ensuing Annual General Meeting will absorb 7 44.58 lacs including corporate dividend tax amounting to 7 6.48 lacs. The dividend in respect of equity shares; if declared at the meeting, will be paid to those members whose name will appear on the Company''s Register of Members on 18th September, 2014; in respect of the shares held in dematerialized form, the dividend will be paid to members whose names are furnished by National Security Depository Limited and Central Depository Services (India) Limited as beneficial owners as on that date.

QUALITY MANAGEMENT SYSTEM

The company continues to lay emphasis on excellence in quality and services and is committed to total customer satisfaction. The high quality of the company products is reflected in the company ability to export its product in quality conscious world markets. The company continues to be on a mission to provide customer with products that can match with international standards and will surpass their expectations.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACIES

The Company has adequate Internal Control systems in all areas of operations commensurate with the size of the operation. Your Company has an adequate and effective internal control system to ensure that assets and interests of the Company are safeguarded and reliability of accounting data and accuracy are ensured with proper checks and balances.

The internal control system is improved and modified continuously to meet the changes in business conditions, statutory and accounting requirements. The Audit Committee of the Board of Directors, Statutory Auditors and the business heads are periodically appraised of the internal audit findings and the corrective actions taken. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal controls systems and suggests improvements for strengthening them.

HUMAN RESOURCES AND SAFETY OF WORKERS

Human capital is the most valuable resource of the organization, Development of human capital has always been thrust area of the Company. The success of any business lies under the qualified, trained & motivated Human Resources; industrial relations are geared at developing and aligning the operatives to the overall goal of the organization. Your Company firmly believes that a dedicated workforce constitute the primary source of sustainable competitive advantage. Accordingly, human resources development continues to receive focused attention. Company takes adequate steps for maintaining safety and healthy environment for the workers.

During the year, Industrial relations continued to be cordial and satisfactory. Your Directors wish to place on record their appreciation of the dedicated and commendable services rendered by the staff and workforce of the Company, without whose efforts, such an impressive performance may not have been possible.

STATEMENT OF EMPLOYEES REQUIRED U/S 217(2A) OF THE COMPANIES ACT

No employee was in receipt of remuneration equal to or exceeding Rs. 60 lacs per annum, if employed for the full year or exceeding Rs. 5 lacs per month if employed for part of the year. Therefore, statement showing particulars of the employees as required under Section 217(2A) of the Companies Act 1956 read with the Companies (Particulars of employees) Rules, 1975 as amended, is not applicable.

ENVIRONMENT AND POLLUTION CONTROL

The Company is conscious of the importance of environmentally clean and safe operations. The company''s policy is the conduct of all operations in a manner to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

DIRECTORS

Shri Raj Kumar Agarwal is liable to retire by rotation and being eligible, has offered himself for reappointment. The Company had, pursuant to the provisions of clause 49 of the Listing Agreements entered with the Stock Exchanges, appointed Shri Bibhuti Charan Talukdar, Shri Parshotam Das Agarwal, Shri Anil Agarwalla and Shri Mohan Lai Jain, as Independent Directors at various times, in compliance with the requirements of the clause. Pursuant to the provisions of section 149 of the New Companies Act 2013, which came in to effect from April 1,2014, every listed public company is required to have at least one-third of the total number of directors as independent directors, who are not liable to retire by rotation. The Nominations & Remuneration Committee has recommended the appointment of these directors as Independent Directors from 26th September, 2014 upto 25th September, 2019. The information on the particulars of Directors seeking appointment and re- appointment as stipulated under Clause 49 of Listing Agreements with the Stock Exchanges, are provided in the notes to Notice forming part of the Annual Report.

AUDITORS AND AUDIT REPORT

M/s A.K. Associates, Chartered Accountants, Independent Auditors of the Company will retire at the forthcoming Annual General Meeting and are eligible for re-appointment and have given a written certificate as per section 141 of the Companies Act, 2013 read with Companies (Audit and Auditors) Rules 2014. In accordance with the Companies Act 2013, it is proposed to re-appoint them from the conclusion of this Annual General Meeting till the conclusion of the 36th Annual General Meeting, subject to the approval of shareholders.

The observations of the auditors in their audit report are self explanatory.

COST AUDITORS

Pursuant to the Ministry of Corporate Affairs Notification dated 30.06.2014, textile industries has been exempted to maintain cost records and to appoint Cost Auditors. Accordingly Company has not appointed Cost Auditors for the Financial Years 2014-15.

CORPORATE SOCIAL RESPONSI Bl LITY COMMITTEE

The Companies Act, 2013 notified section 135 of the Act concerning Corporate Social Responsibility alongwith the Rules thereunder and revised Schedule VII to the Act on 27th February, 2014 and other amendments to Schedule VII to come into effect from 1st April, 2014. The Company being covered under the provisions of the said section, has taken necessary initial steps in this regard. A Committee of the directors, titled ''Corporate Social Responsibility Committee'', has been formed by the Board in its meeting held on 30th May, 2014, consisting of the following:

Name Designation

Shri Parshotam Das Agarwal Chairman

Shri Bibhuti Charan Talukdar Member

Shri Ashok Kumar Agarwal Member

Shri Kailash Kumar Agarwal Member

The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities.

COMPANIES (COMPLIANCE CERTIFICATE)

Compliance Certificate pursuant to Section 383A of the Companies Act, 1956 is annexed hereto.

CORPORATE GOVERNANCE

Company has complied with the requirements of Corporate Governance through constitution and reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). No complaint/ query from any of the shareholder is pending to be resolved by the Company orthe RTA.

LISTING OF SHARES

Company''s shares are listed on Delhi Stock Exchange & Bombay Stock Exchange.

FIXED DEPOSITS

The Company has not accepted / renewed any deposits from the public / members during the year under review.

CASH FLOW

Inconformity with the provisions of clause 32 of the Listing Agreement the Cash Flow Statement for the year ended 31.03.2014 is annexed hereto.

PUBLICATION OF FINANCIAL RESULTS

In conformity with the provisions of clause 41 of the Listing Agreement the Company has published unaudited financial results for the quarter ended 30th June 2013; 30th Sept. 2013; 31st December 2013 and audited financial result for the quarter/ year ended on 31 st March 2014. The summarized results are published in Business Standard (English), Delhi &AajSamaj (Hindi), Hisar.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGAE EARNINGS/ OUT GO

The information required under Section 217(1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 is annexed hereto as annexure A and forms part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement underSection 217(2AA) of the Companies Act, 1956 and on the basis of compliance certificates received from the concerned executives of the respective departments of the Company and subject to disclosures in the annual accounts, as also on the basis of the discussion held with the statutory Auditors of the Company from time to time, we state:

1. That in the preparation of annual accounts, applicable accounting standards have been followed and proper explanations have been provided relating to material departures, if any;

2. That the Directors have selected appropriate accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company forthat period;

3. That the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, if any,

4. That the Directors have prepared the annual accounts for the financial year ended 31 stMarch, 2014 on a going concern basis.

5. That the Directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

6. That the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

APPRECIATION

The Directors place on record their thanks and appreciation to all workers, staff members, executives and business associates for their co-operation and contribution to the operations of the company. The Directors are thankful to the Bankers, Financial Institutions for their continued support to the company. The Directors also place on record their sincere thanks to the shareholders for their continued support, co-operation and confidence in the Management of the Company.

For and on behalf of the Board

Raj Kumar Agarwal Chairman (DIN:02950710)

Place: New Delhi Dated: 13th August, 2014


Mar 31, 2013

Dear Shareholders,

The Directors have pleasure in presenting to you, the Thirty Second Annual Report on the activities of your Company along with the Audited Annual Accounts for the financial year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS

The financial results of the Company for the year under review are compared below with the previous year''s results for your consideration.

(Rs. In Lacs)

Particulars Year ended Year ended 31.03.13 31.03.12

Sales and other Income 8664 7376

Profit before financial charges and depreciation 898 579

Financial charges (242) (284)

Profit before depreciation 656 295

Depreciation (131) (144)

Profit before tax 525 151

Prior year adjustment 10 (13)

Profit before Tax 535 138

Less: Provision for Tax

- CurrentTax (including 1 lac for earlier year) (195) -

- Deferred Tax (1) (48)

Profit after Tax 339 90

Basic and Diluted Earning PerShare (Rs.) 889 2.36

Dividend Recommended Rs./Share 1 -

Dividend Recommended (%) 10 -

OPERATIONAL PERFORMANCE

The total sale of the company for the year was Rs. 8625 lacs as compared to the Rs. 7354 lacs in the preceding financial year. The exports of the Company increased from Rs. 5248 lacs to Rs. 5965 lacs, showing an increase of 14% over the preceding financial year. Packed production for the year was 1986 MT as compared to 1484 MT in the preceding financial year. During the year under review, Company has earned profit before financial charges and depreciation of Rs. 898 lacs as against Rs. 579 lacs in the preceding financial year and profit after tax of Rs. 339 lacs as against Rs. 90 lacs in the preceding financial year.

APPROPRIATIONS

Reserves

Out of the profits of the Company, a sum of Rs. 50 lacs has been transferred to the General Reserves during the year and total reserves and surplus of the Company are Rs. 1029 lacs (Including Share Premium) as on 31st March, 2013.

Dividend

Your Directors are pleased to recommend for your consideration and approval dividend @ 10% for the financial year 2012-13 i.e. Rs. 1/- per equity share of Rs. 10/- each. The dividend if approved at ensuing Annual General Meeting will adsorb Rs. 44.58 lacs including corporate dividend tax amounting to Rs. 6.48 lacs.

The dividend in respect of equity shares; if declared at the meeting, will be paid to those members whose name will appear on the Company''s Register of Members on 30th August, 2013; in respect of the shares held in dematerialized form, the dividend will be paid to members whose names are furnished by National Security Depository Limited and Central Depository Services (India) Limited as beneficial owners as on that date.

QUALITY MANAGEMENT SYSTEM

The company continues to lay emphasis on excellence in quality and services and is committed to total customer satisfaction. The high quality of the company products is reflected in the company ability to export its product in quality conscious world markets. The company continues to be on a mission to provide customer with products that can match with international standards and will surpass their expectations. Further the Company has got certificate of ISO 9001: 2008 from The Certification Body of TU V SUD South Asia Private Limited.

INTERNAL CONTROLSYSTEM ANDTHEIR ADEQUACIES

The Company has adequate Internal Control systems in all areas of operations commensurate with the size of the operation. Your Company has an adequate and effective internal control system to ensure that assets and interests of the Company are safeguarded and reliability of accounting data and accuracy are ensured with proper checks and balances.

The infernal control system is improved and modified continuously to meet the changes in business conditions, statutory and accounting requirements. The Audit Committee of the Board of Directors, Statutory Auditors and the business heads are periodically appraised of the internal audit findings and the corrective actions taken. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal controls systems and suggests improvements for strengthening them.

HUMAN RESOURCES AND SAFETY OF WORKERS

Human capital is the most valuable resource of the organization, Development of human capital has always been thrust area of the Company. The success of any business lies under the qualified, trained & motivated Human Resources; industrial relations are geared at developing and aligning the operatives to the overall goal of the organization. Your Company firmly believes that a dedicated workforce constitute the primary source of sustainable competitive advantage. Accordingly, human resources development continues to receive focused attention. Company takes adequate steps for maintaining safety and healthy environment for the workers.

During the year, Industrial relations continued to be cordial and satisfactory. Your Directors wish to place on record their appreciation of the dedicated and commendable services rendered by the staff and workforce of the Company, without whose efforts, such an impressive performance may not have been possible.

STATEMENT OF EMPLOYEES REQUIRED U/S 217(2A) OF THE COMPANIES ACT

No employee was in receipt of remuneration equal to or exceeding Rs. 60 lacs per annum, if employed for the full year or exceeding Rs. 5 lacs per month if employed for part of the year. Therefore, statement showing particulars of the employees as required under Section 217(2A) of the Companies Act 1956 read with the Companies (Particulars of employees) Rules, 1975 as amended, is not applicable.

ENVIRONMENT AND POLLUTION CONTROL

The Company is conscious of the importance of environmentally clean and safe operations. The company''s policy is the conduct of all operations in a manner to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

DIRECTORS

Shri Ashok Kumar Agarwal and Shri Mohan Lai Jain; Directors are liable to retire by rotation and being eligible, have offered themselves for reappointment. The information on the particulars of Directors seeking appointment and re- appointment as stipulated under Clause 49 of Listing Agreements with the Stock Exchanges, are provided in the notes to Notice.forming part of the Annual Report.

AUDITORS AND AUDIT REPORT

The retiring Statutory Auditors M/s A.K. Associates, Chartered Accountants, hold office until the conclusion of the ensuing Annual General Meeting .The Company has received a letter from them thattheirreappointment, if made, would be within the prescribed limits under section 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such appointment/ reappointment within the meaning of section 226 of the said Act or any other Act rules or regulations applicable for such appointment/reappointment.

The observations of the auditors in their audit report are self explanatory.

COST AUDITORS

Pursuant to the directives from the Central Government and the provisions of Section 233B of the Companies Act, 1956, the Board of Director has appointed M/s HMVN & Associates., Cost Auditors with approval of Central Government to conduct the cost audit of the products manufactured by the company for the period under review.

The Cost Audit Report for the financial year 2012-13 shall be submitted to the Central Government within the stipulated period.

COMPANIES (COMPLIANCE CERTIFICATE)

Compliance Certificate pursuant to Section 383A of the Companies Act, 1956 is annexed hereto.

CORPORATE GOVERNANCE

Company has complied with the requirements of Corporate Governance through constitution and reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). No complaint/ query from any of the shareholder is pending to be resolved by the Company or the RTA.

ENVIRONMENT AND POLLUTION CONTROL

The Company is conscious of the importance of environmentally clean and safe operations. The company''s policy is the conduct of all operations in a manner to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

DIRECTORS

Shri Ashok Kumar Agarwal and Shri Mohan Lai Jain; Directors are liable to retire by rotation and being eligible, have offered themselves for reappointment. The information on the particulars of Directors seeking appointment and re- appointment as stipulated under Clause 49 of Listing Agreements with the Stock Exchanges, are provided in the notes to Notice.forming part of the Annual Report.

AUDITORS AND AUDIT REPORT

The retiring Statutory Auditors M/s A.K. Associates, Chartered Accountants, hold office until the conclusion of the ensuing Annual General Meeting .The Company has received a letter from them that their reappointment, if made, would be within the prescribed limits under section 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such appointment/ reappointment within the meaning of section 226 of the said Act or any other Act rules or regulations applicable for such appointment/reappointment.

The observations of the auditors in their audit report are self explanatory.

COST AUDITORS

Pursuant to the directives from the Central Government and the provisions of Section 233B of the Companies Act, 1956, the Board of Director has appointed M/s HMVN & Associates., Cost Auditors with approval of Central Government to conduct the cost audit of the products manufactured by the company for the period under review.

The Cost Audit Report for the financial year 2012-13 shall be submitted to the Central Government within the stipulated period.

COMPANIES (COMPLIANCE CERTIFICATE)

Compliance Certificate pursuant to Section 383A of the Companies Act, 1956 is annexed hereto.

CORPORATE GOVERNANCE

Company has complied with the requirements of Corporate Governance through constitution and reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). No complaint/ query from any of the shareholder is pending to be resolved by the Company or the RTA.

LISTINGOFSHARES

Company''s shares are listed on Delhi Stock Exchange & Bombay Stock Exchange.

FIXED DEPOSITS

The Company has not accepted / renewed any deposits from the public / members during the year under review.

CASH FLOW

Inconformity with the provisions of clause 32 of the Listing Agreement the Cash Flow Statement for the year ended 31.03.2013 is annexed hereto.

PUBLICATION OF FINANCIAL RESULTS

In conformity with the provisions of clause 41 of the Listing Agreement the Company has published unaudited financial results for the quarter ended 30th June 2012; 30th Sept. 2012; 31st December 2012 and audited financial result for the quarter/ year ended on 315l March 2013. The summarized results are published in Business Standard (English), Delhi & Dainik Bhaskar/Aaj Samaj (Hindi), Hisar.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGAE EARNINGS/OUT GO

The information required under Section 217(1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 is annexed hereto as annexure A and forms part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement underSection 217(2AA) of the Companies Act, 1956 and on the basis of compliance certificates received from the concerned executives of the respective departments of the Company and subject to disclosures in the annual accounts, as also on the basis of the discussion held with the statutory Auditors of the Company from time to time, we state:

1. That in the preparation of annual accounts, applicable accounting standards have been followed and proper explanations have been provided relating to material departures, if any;

2. That the Directors have selected appropriate accounting policies and applied them consistently and made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

3. That the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, if any,

4. That the Directors have prepared the annual accounts for the financial year ended 31st March, 2013 on a going concern basis.

APPRECIATION

The Directors place on record their thanks and appreciation to all workers, staff members, executives and business associates for their co-operation and contribution to the operations of the company. The Directors are thankful to the Bankers, Financial Institutions for their continued support to the company. The Directors also place on record their sincere thanks to the shareholders for their continued support, co-operation and confidence in the Management of the Company.

For and on behalf of the Board

Ashok Kumar Agarwal Kailash Kumar Agarwal

Place: New Delhi Deputy Managing Director Deputy Managing Director

Dated: 22nd July, 2013


Mar 31, 2012

To The member's of H.P. Cotton Textile Mills Ltd.,

The Directors have pleasure in presenting the Thirty First Annual Report together with the Audited Annual Accounts of the Company for the year ended 31st March 2012. . '

FINANCIAL HIGHLIGHTS

The financial results of the Company for the year under review'are compared below with the previous year's results for your consideration. - .

(Rupees In Lacs)

Particulars Year ended Year ended 31.03.12 31.03.11*

- Sales and other Income 7376 7395

Profit Pefore financial charges and depreciation 579 413

Financial charges (284) (231)

Profit Pefore depreciation, 295 182

Depreciation (144) (146)

Profit before tax 151 36

Prior year adjustment (13) 9

Profit before Tax 138 45

Less: Provision for Tax

- Current Tax ' (8)

- Deferred Tax (48) (10)

Profit after Tax 90 27

Surplus as per last year 30 3

Surplus carried forward to next year 120 30

‘Previous year's figures have been reclassified/ regrouped wherever necessary to correspond with those of current year.

OPERATIONAL PERFORMANCE:

During the year under review, your Company has earned profit before financial charges and depreciation of Rs 579 lacs as against Rs 413 lacs in the previous year and profit after tax of Rs 90 lacs as against Rs 27 lacs in the previous year. The exports of the Company increased from Rs 4258 lacs to Rs 5248 lacs, showing an increase of 23% over the previous year.

QUALITY MANAGEMENT SYSTEM

The company continues to lay emphasis on excellence in quality and services and is committed to total customer satisfaction. The high quality of the company products is reflected in the company ability to export its product in quality conscious European markets. The company continues to be on a mission to provide customer with products that can match with international standards and will surpass their expectations.

INTERNAL CONTROL SYSTEM AND THEIR ADEQUACIES

The Company has adequate Internal Control systems in all areas of operations commensurate with the size of the operation. Your Company has an adequate and effective internal control system to ensure that assets and interests of the Company are safeguarded and reliability of accounting data and accuracy are ensured with proper checks and balances.

The internal control system is improved and modified continuously to meet the changes in business conditions, statutory and accounting requirements. The Audit Committee of the Board of Directors, Statutory Auditors and the business heads are periodically appraised of the internal audit findings and the corrective actions taken. The Audit Committee of the Board of Directors actively reviews the adequacy and effectiveness of internal controls systems and suggests improvements for strengthening them.

HUMAN RESOURCES AND SAFETY OF WORKERS

The Company's HR philosophy is to establish and build a high performing organization, where each individual is motivated to perform to the fullest capacity to contribute to developing and achieving individual excellence and departmental objectives and continuously improve performance to realize the full potential of our personnel.

During the year under review, the industrial relations continued to be cordial and satisfactory. DIVIDEND

To conserve the resources for working capital and capital expenditure the directors do not recommend any dividend for the financial year under review.

REMUNERATION OF EMPLOYEES

No employee was in receipt of remuneration equal to or exceeding Rs.60 lacs per annum, if employed for the full year or exceeding Rs. 5 lacs per month if employed for part of the year. Therefore, statement showing particulars of the employees as required under Section 217(2A) of the Companies Act 1956 read with the Companies (Particulars of employees) Rules, 1975 as amended, is not applicable.

ENVIRONMENT AND POLLUTION CONTROL

The Company is conscious of the importance of environmentally clean and safe operations. The company's policy is the conduct of all operations in a manner to ensure safety of all concerned, compliance of statutory and industrial requirements for environment protection and conservation of natural resources to the extent possible.

DIRECTORS

Shri Kailash Kumar Agarwal and Shri Bibhuti Charan Talukdar, directors are liable to retire by rotation and being eligible, offer themselves for re-appointment. The information on the particulars of Directors seeking appointment and re-appointment as stipulated under Clause 49 of Listing Agreement with the Stock Exchanges, are provided in the notes to Notice forming part of the Annual Report.

AUDITORS AND AUDIT REPORT

The retiring Statutory Auditors M/s A.K. Associates, Chartered Accountants, hold office until the conclusion of the ensuing Annual General Meeting. The Company has received a letter from them that their re-appointment, if made, would be within the prescribed limits under section 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such appointment/ re-appointment within the meaning of section 226 of the said Act or any other Act rules or regulations applicable for such appointment/ re-appointment.

The Auditor's Report on the accounts is self explanatory COST AUDITORS

Pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956, the Company has appointed M/s HMVN & Associates, Cost Auditors with approval of Central Government to conduct the cost audit of the products manufactured by the company for the period under review.

COMPANIES (COMPLIANCE CERTIFICATE)

Compliance Certificate pursuant to Section 383A of the Companies Act, 1956 is annexed hereto. CORPORATE GOVERNANCE

Company has complied with the requirements of Corporate Governance through constitution and reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). No complaint/ query from any of the shareholder is pending to be resolved by the Company or the RTA.

LISTING OF SHARES

Company's shares are listed on Delhi Stock Exchange & Bombay Stock Exchange.

FIXED DEPOSITS

The Company has not accepted / renewed any deposits from the public / members during the year under review.

CASH FLOW

Inconformity with the provisions of clause 32 of the Listing Agreement the Cash Flow Statement for the year ended 31.03.2012 is annexed hereto.

PUBLICATION OF FINANCIAL RESULTS

In conformity with the provisions of clause 41 of the Listing Agreement the Company has published unaudited financial results for the quarter ended 30th June 2011; 30th Sept. 2011; 31 st December 2011 and audited financial result for the quarter/ year ended on 31st March 2012. The summarized results are published in Business Standard (English), Delhi & Dainik Bhaskar (Hindi), Hisar.

ENERGY CONSERVATION. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGAE EARNINGS/ OUT GO

The information required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 is annexed hereto as annexure A and forms part of this report. .

DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 21 7(2AA) of the Companies Act, 1956 and on the basis of compliance certificates received from the concerned executives of the respective departments of the Company and subject to disclosures in the annual accounts, as also on the basis of the discussion held with the statutory Auditors of the Company from time to time, we state:

1. That in the preparation of annual accounts, applicable accounting standards have been followed and proper explanations have been provided relating to material departures, if any;

2. That the Directors have selected appropriate accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;

3. That the Directors have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, if any,

4. That the Directors have prepared the annual accounts on a going concern basis. APPRECIATION

The Directors place on record their thanks and appreciation to all workers, staff members, executives and business associates for their co-operation and contribution to the operations of the company. The Directors are thankful to the Bankers, Financial Institutions for their continued support to the company. The Directors also place on record their sincere thanks to the shareholders for their continued support, co-operation and confidence in the Management of the Company.

For and on behalf of the Board

Ashok Kumar Agarwal Kailash Kumar Agarwal Deputy Managing Director Deputy Managing Director

Place : New Delhi

Dated : 14th August, 2012


Mar 31, 2010

The Directors have pleasure in presenting the Twenty Ninth Annual Report together with the Audited Statements of Accounts of the Company forthe year ended 31st March 2010.

FINANCIAL HIGHLIGHTS

The financial results of the Company for the year under review are compared below with the previous years results for your consideration.

(Amt. in Crores)

Particulars Year ended Year ended 31st March, 2010 31st March, 2009

Sales and other Income 59.53 51.18

Profit/(Loss) before financial charges and depreciation 3.90 3.01

Financial charges (2.23) (2.30)

Profit/(Loss) before depreciation 1.67 0.71

Depreciation (1.60) (1.60)

Profit before tax 0.07 (0.89)

Income tax provision 0.02 0.00

FBT Provision 0.00 0.05

Profit after Tax 0.05 (0.94)

Deferred Tax Assets (0.12) 0.25

Prior year adjustment 0.10 0.08

Transferred to Reserve 0.03 (0.61)



DIRECTORS

During the Year Company has to bear the irrecoverable loss of its promoter director Sh. Arjun Dass Agarwal. Sh. Mohan Lal Jain was appointed as additional director of the company and offer himself for appointment as a director. In accordance with Article 110 of the Articles of the Association of the Company Shri B.C. Talukdar and Shri Ashok Kumar Agarwal Directors are liable to retire by rotation and being eligible, offer themselves for reappointment.

The information on the particulars of Directors seeking re- appointment as stipulated under Clause 49 of Listing Agreements with the Stock Exchanges, are provided in the notes to Notice forming part of the Annual Report.

AUDITORS AND AUDIT REPORT

The retiring Statutory Auditors M/s A.K. Associates, Chartered Accountants, hold office until the conclusion of the ensuring Annual General Meeting .The Company has received a letter from them that their reappointment, if made, would be with in the prescribed limits under section 224(1 B) of the Companies Act, 1956, and that they are not disqualified for such appointment/ reappointment with in the meaning of section 226 of the said Act or any other Act rules or regulations applicable for such appointment/ reappointment. The report of the Statutory Auditors on the Balance Sheet & Profit & Loss for the year ended 31st March, 2010 is self explanatory and does not require any statement from the company.

In respect of auditors observation in point no. (xi) of Annexure to Auditors Report regarding certain delay in repayment of dues to IDBI, we wish to inform that company has requested IDBI for deferment of installment & interest falling due on 01.04.2009 & 01.07.2009 amounting to Rs. 3132708/-&Rs. 3167286/-respectively. However IDBI has accepted partly deferment of installment & interest and accordingly installment & interest has been repaid.

COST AUDITORS

In pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956, the Company has appointed M/s Naresh Goel, Cost Auditors to conduct the audit of the products manufactured by the Company for the period under review.

CORPORATE GOVERNANCE

The Company has complied with the requirements of Corporate Governance through constitution and reconstitution of various committees and has taken adequate steps to ensure that all mandatory provisions of Corporate Governance as provided in the Listing Agreement with the Stock Exchanges are duly complied with. A separate report on Corporate Governance along with the Auditors certificate on compliance with the Corporate Governance as stipulated in Clause 49 forms part of this Annual Report.

INVESTOR SERVICES

The Company has appointed M/s Alankit Assignments Limited, New Delhi as Registrar and Share Transfer Agent (RTA). We have been informed that no complaint/query from any of the shareholder is pending to be resolved by the Company or the RTA.

LISTING OF SHARES

The companys share are listed on Delhi Stock Exchange and Bombay Stock Exchange. The company has its equity shares delisted from the Stock Exchange(s) of Ludhiana and Kolkatta. The Company is regularly following up for delisting with Jaipur Stock Exchange.

FIXED DEPOSITS

The Company has not accepted / renewed any deposits from the public / members during the year under review.

DIVIDEND

The Directors regret their inability to recommend dividend for the year under review due to inadequacy of profit.

CASH FLOW

Inconformity with the provisions of clause 32 of the Listing Agreement the Cash Flow Statement for the year ended 31.03.2010 is annexed hereto.

PUBLICATION OF FINANCIAL RESULTS

In conformity with the provisions of clause 41 of the Listing Agreement the Company has published unaudited financial results for the quarter ended 3oth June 2009; 30th Sept. 2009; 31st December 2009 and audited financial result for the quarter ended on 31st March 2010. The summarized result published Business Standard, Delhi & Dainik Bhaskar (Hindi) Hisar.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGAE EARNINGS/ OUT GO

The information required under Section 217(l)e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 is annexed hereto as annexure A and forms part of this report.

DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956 and on the basis of compliance certificates received from the concerned executives of the respective departments of the Company and subject to disclosures

in the annual accounts, as also on the basis of the discussion held with the statutory Auditors of the Company from time to time, we state:

1. that in the preparation of the annual accounts, the applicable accounting standards have been followed and proper explanations provided relating to material departures, if any;

2. that the Directors have selected appropriate accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;

3. that the Directors have taken proper and sufficient care to ensure the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, if any,

4. that the Directors have prepared the annual accounts on a going concern basis.

APPRECIATION

The Board of Directors of the company wish to place on record their thanks and appreciation to all workers, staff members and executives for their contribution to the operations of the company. The Directors are thankful to the Bankers, Financial Institutions for their continued support to the company. The Directors also place on record their sincere thanks to the shareholders for their continued support, co-operation and confidence in the Management of the Company.

For and on behalf of the Board

Ashok Kumar Agarwal Kailash Kumar Agarwal

Deputy Managing Director Deputy Managing Director

Place: New Delhi

Date : 12th August, 2010

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