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Directors Report of Kanco Tea & Industries Ltd.

Mar 31, 2015

Dear Shareholders,

The Directors are pleased to present their Thirty Second Annual Report and the Company''s audited financial statement for the financial year ended 31st March, 2015.

Financial Results

The Company''s financial performance, for the year ended March 31, 2015 is summarized below:

Rs.in Lacs

Particulars Current Year Previous Year

Profit Before Interest, Depreciation and Tax 602.22 689.36

Less : Interest 110.26 115.55

Gross Profit for the year 491.96 573.81

Less : Depreciation 151.85 91.57

Profit Before Tax 340.11 482.24

Less : Provision For :-

Net Current Tax 57.73 87.53

Provision for MAT Credit Entitlement (15.97) (43.25)

41.76 44.28

Deferred Tax (10.61) 9.27

31.15 53.55

Profit/(Loss) After Taxation 308.96 428.69

Add : Balance Brought Forward from Last Account 1454.49 1171.84

1763.45 1600.53

Less : Transfer to General Reserve 30.90 42.87

Less : Proposed dividend 70.23 88.18

Less : Dividend Distribution Tax 17.95 14.99

Balance Carried to Balance Sheet 1644.37 1454.49

Results of Operations and the State of the Company''s Affairs

During the year under review, the production of own tea and tea made from bought leaves went down by 78261 Kgs and 101100 Kgs compared to previous year. The profit before tax stood at Rs340.11 Lacs compared to Rs482.24 Lacs for the previous year. The decline in working results was mainly due to loss of crop, increase in depreciation due to reassessment of useful lives of its fixed assets as specified in Part C of Schedule II to the Companies Act, 2013 and substantial increase in provision for gratuity pursuant to actuarial valuation.

Your Company continued to take advantage of the Special Purpose Tea Fund Scheme announced by the Tea Board of India. In the financial year 2014-2015, 28.13 hectares, 24.19 hectares and 24.10 hectares of the plantation area were replanted, rehabilitated and uprooted respectively. We have added an irrigation set in Mackeypore Tea Estate and investment has been made in factory. Your Company has also built labour latrines to improve the living condition of its workforce.

The current season started with an increase in crop due to favourable weather conditions. The north India auction average price upto May, 2015 is lower by 8.35% compared to corresponding period in the previous year. Your Company being producer of premium quality teas will be less affected by fall in tea prices compared to medium and low quality producers. The increase in wage rate and inputs like H.S.D.Oil, Pesticides, Natural Gas and Manures will hit the bottom line. The thrust on irrigation and replanting under SPTF will continue.

Certifications

The quality management system of Mackeypore Tea Estate, Kanco Tea & Industries Limited bearing ANZSIC Code: 2180 has been assessed and found to meet the requirements of ISO 9001:2008.The certificate no. IN/QMS/00270 is valid for manufacturing of black tea from green tea leaves till 20/05/2016.

The food safety systems of Mackeypore Tea Estate, Kanco Tea & Industries Limited bearing ANZSIC Code: 2180 has been assessed and found to meet the requirements of HACCP (Hazard Analysis and Critical Point). The certificate no. IN/HACCP/00027 is valid for manufacturing of black tea from green tea leaves till 20/05/2016.

The food safety systems of Mackeypore Tea Estate, Kanco Tea & Industries Limited has been assessed and found to meet the requirements of ISO 22000:2005 (Food Safety Management System). The certificate no. IN/FSMS/00065 is valid for manufacturing of black tea from green tea leaves till 20/05/2016.

Mackeypore Tea Estate & Lakmijan Tea Estate has been issued verification certificate bearing no. TS-VC/CUC/03/ 834385/14 & TS-VC/CUC/04/8347386/14 under trustea code for sustainable tea in India by Control Union. The trustea code covers social, agronomic, food safety, occupational health & safety and environmental criteria. The certificates are valid till 22/12/2016.

Appropriations Transfer to reserves

Rs30.90 Lacs has been transferred to general reserve and Rs189.88 has been retained in surplus.

Dividend

The Directors of your Company has recommended a dividend of Rs7/- and Rs5/ (Last Year 1 /- and Rs5/-) per Preference Share of Face Value of Rs100/- and Equity Share of Face Value of Rs10/-share respectively for the year under review.

Extract of Annual Return

The details forming part of the extract of the Annual Return in Form No. MGT-9 as required under Section 92 of the Companies Act, 2013 is annexed herewith marked as Annexure A to this report.

Directors

During the year under review, the members approved the appointment of Mr. Umang Kanoria (DIN: 00081108) as Non-Executive Non-Independent Director, who is liable to retire by rotation and in accordance with the provisions of the Act and the Articles of Association of the Company, he retires by rotation at the ensuing Annual General Meeting and being eligible has offered himself for reappointment.

Mr. Navin Nayar (DIN: 00136057) and Mr. Golam Momen (DIN: 00402662) were appointed as the Independent Directors of the Company who are not liable to retire by rotation. The Members have also re-appointed Mrs. Anuradha Kanoria (DIN: 00081172) as the Whole time Director of the Company.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and Clause 49 of the Listing Agreement with the Stock Exchanges.

The Company has devised a Policy for Performance evaluation of Independent Directors, Board, Committees and other Individual Directors which includes criteria for performance evaluation of the non-executive directors and executive directors and is annexed herewith marked as Annexure B to this report.

The performance evaluation of the Chairman and the non independent Directors was carried out by the Independent Directors. On the basis of the Policy the Performance Evaluation of Independent Directors, Board, Committees and other individual Directors were carried. The Board of Directors expressed their satisfaction with the evaluation process.

Number of Meetings of the Board

Six meeting of the Board of Directors were held during the year.

Audit Committee

The Audit Committee comprises Independent Directors namely Mr. Navin Nayar (Chairman) and Mr. Golam Momen and Mr. Govind Ram Banka, Non-Executive Director. All the recommendations made by the Audit Committee were accepted by the Board.

Directors'' Responsibility Statement

The Directors hereby confirms that

a) in the preparation of the annual accounts, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

b) they had selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2015 and of the profit of the Company for the year ended on that date;

c) they had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) they had prepared the annual accounts on a going concern basis;

e) they had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively; and

f) they had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Statutory Auditors

Messrs. Jain & Co., Chartered Accountants, Registration No. 302023E, Statutory Auditor of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have expressed their willingness to continue as Statutory Auditors of the Company, if so appointed by the members. Your Company has received the consent and certificate from Messrs. Jain & Co., Chartered Accountants to the effect that their re- appointment if made, would be within the limits prescribed under the section 141 of the Companies Act, 2013 read with rules and that they are not disqualified for reappointment within the meaning of Section 141 of the Companies Act 2013. They have also confirmed that they hold a valid peer review certificate as prescribed under Clause 41(1) (h) of the Listing Agreement.

Statutory Auditors'' Report

The report by the Auditors is self-explanatory and has no qualification, reservation, adverse remark or disclaimer; hence no explanation or comments by the Board were required.

Secretarial Audit Report

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed P.S. & Associates a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit Report is annexed herewith marked as Annexure C to this report.

Further, this report has no qualification, reservation, adverse remark or disclaimer; hence no explanation or comments by the Board were required.

Particulars of Loans, Guarantees or Investments by Company

Particulars of investments made by the Company are provided in note no.12 & 15 to the financial statements.

The Company has neither given any loan & guarantee nor provided any security during the financial year under review. The particulars of loan as on 01/04/2014 and 31/03/2015 are provided in note no.13 to the financial statements.

Contracts and Arrangements with Related Parties

All contracts / arrangements / transactions entered by the Company during the financial year with related parties were in the ordinary course of business and on an arm''s length basis.

Material Changes and commitments occurred between the end of the Financial Year under Review and the date of this report.

No material changes and commitments have occurred between the end of the financial year under review and the date of this report.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

A statement pursuant to Section 134(3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 on conservation of energy, technology absorption, foreign exchange earnings and outgo is annexed herewith marked as Annexure D to this report.

Risk Management

As per requirement of Section 134(3) (n) of the Companies Act, 2013 the Board of Directors in its meeting held on 9th May, 2014 has approved the Risk Management Policy. The Board envisaged the following elements of risks which may threaten the existence of the Company-

Nature Related Risk

Tea being an agricultural produce is affected by the vagaries of weather. Weather plays a major role in determining the final output of produce. Both excess and scarcity of rainfall play havoc with the final output of produce. KTIL has carried out extensive drainage network to deal with the problem arising out of excess rainfall. KTIL has a detailed plan of action for bringing its plantation areas under irrigation and more than 70% of its plantation areas are under irrigation now.

Pest Management

Tea bushes are prone to attack by various pests like cater pillars, Loppers, Red Slugs, Red Spiders, Helopeltis, Thrips, Green Fly, etc. KTIL has experienced competent senior personnel in the garden, who controls pest by way of timely detection and spray of agro-chemicals. KTIL has also a policy of keeping adequate agro chemicals in stock in anticipation of pest attack during a particular month based on past behavior of pests. KTIL is working out on a plan on integrated pest management, which will promote the use of physical, biological and mechanical control methods, and the least possible use of agrochemicals.

Labour

Tea being a labour intensive industry is prone to loss of output due to labour unrest. KTIL provides all its workforce employed in the estate along with their families access to drinking water, food, housing and basic medical care as per the guideline of Plantation Labour Act,1951 and Assam Plantation Labour Rules. Workers are paid the official agreed wage as per the agreement entered into between the recognised trade union and KTIL. KTIL follows a strict ''Non-Discrimination Policy''on the basis of race, creed, gender, political opinion and membership of trade union. KTIL always aim to maintain cordial relationship with its workforce.

Market Risk

The tea prices are volatile and affected by the conditions prevailing in the market. The inferior quality teas are affected more by volatility in prices in comparison to top quality teas. KTIL''s thrust on making top quality teas minimized the risk due to volatility in prices.

Bought Leaf Operation

KTIL purchases green leaves from outside suppliers and produces it under a different mark called Lakmijan to protect its own mark Mackeypore. KTIL processes the bought leaves separately from its own leaves. The physical segregation of own tea leaves and bought leaves manufacturing process is clearly visible. The Company is vulnerable to volatility in selling price of tea made from bought leaves.

Risks due to Fire, Accident, Theft, Etc.

KTIL has taken appropriate insurance policy to safeguard itself against loss that may arise from risks associated with fire, earthquake etc.

Risk due to Fraud

KTIL has installed adequate internal control measures to minimise the occurrence of fraud and internal audit is also conducted at regular intervals by an external agency.

Risk of Doubtful and Bad Debt

The credit worthiness of sundry debtors is checked by the senior management to fix the credit period, if any to be given. The background check of new party is also carried out before deciding on the credit period.

Corporate Social Responsibility Committee and Policy

a)The Company''s CSR activities shall primarily include one or more of the items covered under Schedule VII to the Act as detailed below: -

(i) eradicating hunger, poverty and malnutrition, promoting health care including preventive health care and sanitation and making available safe drinking water;

(ii) promotion of education including special education and employment enhancing vocation skills especially among children, women, elderly and the differently abled and livelihood enhancement projects;

(iii) promoting gender equality, empowering women, setting up homes and hostels for women and orphans;

Setting up old age homes, day care centres and such other facilities for senior citizens and measures for reducing inequalities faced by socially and economically backward groups;

(iv) ensuring environmental sustainability, ecological balance, protection of flora and fauna, animal welfare, agroforestry, conservation of natural resources and maintaining quality of soil, air and water;

(v) protection of national heritage, art and culture including restoration of buildings and sites of historical importance and works of art; setting up public libraries; promotion and development of traditional arts and handicrafts;

(vi) measures for the benefit of armed forces veterans, war widows and their dependents;

(vii) training to promote rural sports, nationally recognized sports, Paralympic sports and Olympic sports;

(viii) contribution to the Prime Minister''s National Relief Fund or any other fund set up by the Central Government for socio-economic development and relief and welfare of the Scheduled Castes, the Scheduled Tribes, other backward classes, minorities and women;

(ix) contribution or funds provided to technology incubators located within academic institutions which are approved by the Central Government;

(x) rural development projects.

(xi) slum area development

Preference shall be given to Company''s Business and areas around Company''s Tea Estates for spending the amount earmarked for CSR.

b) The Corporate Social Responsibility Committee comprises of the Directors viz, Mr. Umang Kanoria (Chairman), Mr. Navin Nayar and Mr. Govind Ram Banka as other members of the Committee.

The Corporate Social Responsibility Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, which has been approved by the Board.

c) Average net profit of the company for last three financial years - Rs.4,43,36,867/-

d) Prescribed CSR Expenditure (two per cent of the amount as in item c above) - Rs.8,86,737/-

The Company was unable to identify a registered trust to carry out activities on its behalf in areas around its Tea Estates during the year under review and therefore Rs.8,86,737/- being 2% of average net profit of the Company for last three financial years has been kept as liability in the financial year under review. The Company has formed "Kanco- CSR Trust", which got registered on 31st March, 2015 and Rs. 8,86,737/- earmarked in the financial year under review for CSR activities will be incurred in the financial year 2015-2016 through the said trust.

The CSR policy can be viewed at http://kancotea.in/pdf/CSR%20POLICYPDF

Formation of Wholly Owned Subsidiary Company

During the year under review, Winnow Investments and Securities Private Limited, a Wholly owned Subsidiary of the Company was incorporated on 30th March 2015. Winnow Investments and Securities Private Limited did not commence its business in the financial year under review and therefore consolidated accounts has not been prepared.

Fixed Deposits

Deposits which were accepted under Section 58A of the erstwhile Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975 had been repaid with Interest on their due dates and those deposits whose due dates were after 31st March, 2015 have also been repaid on 31st March, 2015 in accordance with Section 74 (1) (a) of the Companies Act, 2013 read with rule 20 of the Companies (Acceptance of Deposits) Rules, 2014. During the year under review, the Company has not accepted any deposits, within the meaning of Section 73 of the Companies Act, 2013, read with the Companies (Acceptance of Deposits) Rules, 2014.

Material Orders Passed by the Regulators /Courts/ Tribunals

There are no significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company''s operations in future.

Internal Controls

The Company has an effective Internal Control system with reference to Financial Statements. The Audit Committee of the Board of Directors reviews the adequacy and effectiveness of the Internal Control System. The Company''s internal Control System is commensurate with its size, scale and complexities of its operations.

Vigil Mechanism

The Company has a Vigil Mechanism / Whistle Blower policy to report genuine concerns and grievances. Protected disclosures can be made by a whistle blower through an email or dedicated telephone line or a letter to the Chairman of the Audit Committee.

Website: http://kancotea.in/pdf VIGIL%20MECHANISM WHISTLE%20BLOWER%20PQLICY.PDF Stock Exchange

The Company''s equity shares are listed at the Calcutta Stock Exchange Limited (CSE) and the Uttar Pradesh Stock Exchange Limited. The Company''s equity shares (Scrip Code 590130) are traded at the Bombay Stock Exchange Limited (BSE) as per MOU signed between CSE and BSE.

Listing Fees for the financial year 2015-2016 has been paid.

SEBI has allowed the UPSE to exit in terms of Clause 8 of the Exit Circular, 2012 vide its order dated 9th of June,2015.

Deatils Pertaining to Remuneration as required under Section 197(12) of the Companies Act. 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial personnel) Rules. 2014.

(i) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary during the financial year 2014-15, ratio of the remuneration of each Director to the median remuneration of the employees of the Company for the financial year 2014-15 and the comparison of remuneration of each Key Managerial Personnel (KMP) against the performance of the Company are as under:

ii) The median remuneration of employees of the Company during the financial year was Rs.1,16,627/-

iii) the percentage increase in median remuneration of the employees of the Company-15.11 %

iv) Number of permanent employees on the rolls of the Company - 1677

v) Explanation on the relationship between average increase in remuneration and company performance - The average increase in remuneration is 7.12%. The dip in profit is mainly attributable to external factor i.e. vagaries of weathers and therefore the increase in salary, which is as per agreement entered into with trade unions at tea estate and in line with the industry bench mark at the registered office is justified.

vi) Comparison of the remuneration of the Key Managerial Personnel Against the performance of the Company - The total remuneration of Key Managerial Personnel declined by (-)3.44%, whereas the profit before tax declined by 29.43%. The fixed part of the salary was paid to the KMPs and the drop in profit is mainly attributable to vagaries of weather, which is an external factor.

vii) Variations

a) in the market capitalisation of the company- The market capitalisation as on March 31,2015 was Rs.2219.89 Lacs (Rs.1553.92 Lacs as on March 31,2014)

b) in the Price Earning Ratio of the Company was 7.25 as at March 31,2015 and was 3.65 as at March 31, 2014.

c) Percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in the year- Not Applicable.

viii) Average percentile increase already made in the last financial year

a) In the salaries of employees other than the managerial personnel- 7.51%

b) Percentile increase in the managerial remuneration- (-) 3.44%

c) Justification for such increase in remuneration & exceptional circumstances for increase in the managerial remuneration - (Please refer point-v)

ix) Key parameters for any variable component of remuneration availed by the directors- Rs.Nil for the year under review.

x) Ratio of remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year- Not applicable as there are no employees receiving higher remuneration than the highest paid director.

xi) It is hereby affirmed that the remuneration paid to the directors, key managerial personnel and other employees is as per the remuneration policy of the company.

Note- Liability for gratuity and leave encashment as required by Accounting Standard-15 issued by The Institute of Chartered of Accountants of India is provided on actuarial valuation report for the Company as a whole. The amount pertaining to individual employee is not ascertainable and therefore not included in the above calculation.

B. Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable.

General

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

i) No disclosure required under clause 49 of the listing agreement has been made by the Company, as the same is not applicable.

ii) Equity shares of the Company were never suspended from trading during the year under review. Acknowledgement

Your Directors place on record their appreciation for the cooperation and support extended by the Employees, Banks/ Financial Institutions and all other business partners.

For and on behalf of the Board of Directors U.Kanoria

Kolkata, the 16th June, 2015 Chairman & Director


Mar 31, 2014

Dear Shareholders,

The Directors present their Annual Report and Audited Accounts for the year ended 31st March, 2014.

Financial Highlights

Your Company’s financial performance was as follows :

Rs.in Lacs Particulars Current Year Previous Year

Profit Before Interest, Depreciation and Tax 689.36 750.14

Less : Interest 115.55 123.91

Gross Profit for the year 573.81 626.23

Less : Depreciation 91.57 80.71

Profit Before Tax 482.24 545.52

Less : Provision For :- Net Current Tax 87.53 96.10

Provision for MAT Credit Entitlement (43.25) (34.79) 44.28 61.31

Income Tax for earlier years - 3.90

Deferred Tax 9.27 3.08 53.55 68.29

Profit/(Loss) After Taxation 428.69 477.23

Add : Balance Brought Forward from Last Account 1171.84 844.82 1600.53 1322.05

Less : Transfer to General Reserve 42.87 47.72

Less : Proposed dividend 88.18 88.18

Less : Dividend Distribution Tax 14.99 14.31

Balance Carried to Balance Sheet 1454.49 1171.84

Dividend

The Directors of your Company has recommended a dividend of Rs.7/- and Rs. 5/ (Last Year Rs.7 /- and Rs.5/-) per Preference Share of Face Value of Rs. 100/- and Equity Share of Face Value of Rs.10/-share respectively for the year under review.

Operations & Finance :

During the year under review, the production of own tea went down by 54802 Kgs compared to previous year. The profit before tax stood at Rs.482.23 Lacs compared to Rs.545.52 Lacs for the previous year. The decline in working results was mainly due to loss in own crop. The impact of loss of own crop was marginalized by increase in tea made out of bought leaves. The tea made out of bought leaves went up by 152951 Kgs compared to last year.

Your Company continued to take advantage of the Special Purpose Tea Fund Scheme announced by the Tea Board of India. In the financial year 2013-2014, 23.97 hectares, 24.10 hectares and 24.19 hectares of the plantation area were replanted, rehabilitated and uprooted respectively. New planting was done in 2.05 hectares. We have also added irrigation set each in Mackeypore and Lakmijan Tea Estate. Investment has been made in factory machinery to bring further improvement in quality of teas. Your Company has also built labour quarters and labour latrines to improve the living condition of its workforce.

The current season started with a severe drought condition but at present rainfall in moderate quantity has been received. Owing to drought, there has been loss of crop in Industry in general. However, your estate is showing better production owing to its investments made in augmenting irrigation facilities during the past few years. The increase in wage rate and inputs like H.S.D.Oil, Pesticides, Natural Gas and Manures will hit the bottom line. Your Company being producer of premium quality teas will try to offset the increase in cost/kg. of made tea by better price realization. The thrust on irrigation and replanting under SPTF will continue.

Directors

Pursuant to the provisions of Section 161(1) of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Umang Kanoria (DIN- 00081108) was appointed as an Additional Director with effect from 23rd September 2013 and he shall hold office up to the date of the ensuing Annual General Meeting. The Company has received requisite notice in writing from a member proposing Mr. Umang Kanoria for appointment as Non Executive Director.

Mr. Navin Nayar (DIN: 00136057) and Mr. Golam Momen (DIN: 00402662), directors of the Company, are being appointed as Independent Directors for five consecutive years from the conclusion of this Annual General Meeting till the Annual General Meeting for the Financial Year ended 31st March, 2019, not liable to retire by rotation as per the provisions of Section 149 and other applicable provisions of the Companies Act, 2013.

Mr. Govind Ram Banka (DIN: 00207385) shall retire at the forthcoming Annual General Meeting and being eligible offers himself for re-appointment.

Subject to the approval of the members in the general meeting, the Board of Directors on 1st July 2014 re-appointed Mrs. Anuradha Kanoria (DIN : 00081172), as Whole Time Director of the Company for a period of five years with effect from 1st December, 2014 on the terms and conditions agreed to by the Board of Directors and Mrs. Anuradha Kanoria.

The Company has received declarations from the Independent Directors of the Company confirming that they meet with the criteria of independence as prescribed both under sub-section (6) of Section 149 of the Companies Act, 2013 read with the Companies (Appointment and Qualification of Directors) Rules, 2014 and Clause 49 of the Listing Agreement. All the directors of the Company have also confirmed that they are not disqualified from being appointed as directors in terms of Section 274(1) (g) of the Companies Act, 1956.

Necessary resolutions for the appointment /re-appointment of the aforesaid directors have been included in the notice convening the ensuing AGM and details of the proposal for appointment / re-appointment are mentioned in the explanatory statement of the notice.

Directors'' Responsibility Statement

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility Statement, the Directors confirm having:

1. that in the preparation of annual accounts for the financial year ended March 31, 2014, the applicable Accounting Standards have been followed along with proper explanations relating to material departures;

2. selected such accounting policies and have applied them consistently and made judgements 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. taken Proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, and

4. prepared the annual accounts on a going concern basis.

FIXED DEPOSITS

The amount outstanding as on 31st March, 2014 on account of Fixed Deposits aggregating " 93.93 Lacs is yet to mature and all the deposits that matured during the year were repaid with interest due thereon and nothing remains unclaimed.

Auditors

Messrs. Jain & Co., Chartered Accountants, Registration No. 302023E retire at the ensuing Annual General Meeting and being eligible, have expressed their willingness to continue as Auditors of the Company, if so appointed by the members. Your Company has received the consent and certificate from Messrs. Jain & Co., Chartered Accountants to the effect that their re-appointment if made, would be within the limits prescribed under the section 141 of the Companies Act, 2013 read with rules and that they are not disqualified for reappointment within the meaning of Section 141 of the Companies Act 2013. They have also confirmed that they hold a valid peer review certificate as prescribed under Clause 41(1) (h) of the Listing Agreement.

Cost Audit

For the year under review, the Company proposes to reappoint Messrs A.C.Dutta & Co., Cost Accountants (Registration No.000125) as Cost Auditors for the financial year ended March 31, 2015, in accordance with the Companies Act, 2013 and their remuneration is to be ratified at the ensuing Annual General Meeting.

Employee Particulars

The particulars of employees pursuant to Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees)Rule 1975, as amended by Companies (Particulars of Employees)Amendment Rules 2011, are not applicable as no employee was in receipt of remuneration to the extent laid down in the said Rules.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo A statement pursuant to section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988 on conservation of energy, technology absorption, foreign exchange earnings and outgo is annexed to and forms part of this Report.

Acknowledgement

Your Directors place on record their appreciation for the cooperation and support extended by the Employees, Banks/ Financial Institutions and all other business partners.

For and on behalf of the Board of Directors

A. K. Kanoria Umang Kanoria A. K. Gangopadhyay Kolkata, the Wholetime Director Director Company 1st day of July, Secretary 2014


Mar 31, 2013

Dear Shareholders,

The Directors present their Annual Report and Audited Accounts for the year ended 31st March, 2013.

FINANCIAL HIGHLIGHTS

Your Company''s financial performance was as follows :

Rs.in Lacs Particulars 2012-13 2011-12

Profit Before Interest, Depreciation and Tax 750.14 521.24

Less : Interest 123.91 144.80

Gross Profit for the year 626.23 376.44

Less : Depreciatio 80.71 75.80

Profit Before Tax 545.52 300.64

Less : Provision

For :- Net Current Tax 96.10 51.28

Provision for MAT Credit Entitlement (34.79) (15.84)

61.31 35.44

Income Tax for earlier years 3.90

Deferred Tax 3.08 (6.72) 68.29 28.72

Profit/(Loss) After Taxation 477.23 271.92

Add : Balance Brought Forward from Last Account 844.82 702.58

1322.05 974.50

Less : Transfer to General Reserve 47.72 27.19

Less : Proposed dividend 88.18 88.18

Less : Dividend Distribution Tax 14.31 14.31

Balance Carried to Balance Sheet 1171.84 844.82

DIVIDEND

The Directors of your Company has recommended a dividend of " 7/- and " 5/- (Last Year " 7/- and " 5/-) per Preference share of Face Value of " 100/- and Equity Share of Face Value of " 10/- share respectively for the year under review.

OPERATIONS & FINANCE :

During the year under review, prices of North India teas went up by " 25 per kg compared to previous year. However the prices of your company teas increased by " 33 per kg compared to previous year. The gap between price of quality and non quality teas is widening every year and your company being a producer of top quality teas was able to achieve a better price. The focus on producing good quality teas, constant thrust on improving field practices and increase in price realisation due to favourable market condition resulted in increase in working results. The profit before tax stood at " 545.52 Lacs compared to " 300.64 lacs for the previous year.

Your Company continued to take advantage of the Special Purpose Tea Fund Scheme announced by the Tea Board of India. In the financial year 2012-2013, 21.91 hectrares, 23.97 hectares and 24.10 hectares of the plantation area were replanted, rehabilitated and uprooted respectively. We have also added another irrigation set in Mackeypore Tea Estate. Major investment has been made in factory machinery to bring further improvement in quality of teas. Your Company has also built labour quarters and labour latrines to improve the living condition of its workforce.

The current season started with a droughty condition but at present reasonable rainfall has been received. The prices of teas have been sluggish. The increase in wage rate and inputs like H.S.D. Oil, Pesticides and Manures will hit the bottom line. However, your Company being producer of premium quality teas will try to offset the increase in cost/kg. of made tea by better price realisation. The thrust on irrigation and replanting under SPTF will continue.

DIRECTORS

In accordance with the provisions of the Articles of Association of the Company, Mr. Umang Kanoria, Director of the Company, will retire by rotation at the forthcoming Annual General Meeting and being eligible, has offered himself for re-appointment.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors'' Responsibil- ity Statement, the Directors confirm having :

1. that in the preparation of annual accounts for the financial year ended March 31, 2013, the applicable Accounting Standards have been followed along with proper explanations relating to material departures;

2. selected such accounting policies and have applied them consistently and made judgements 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. taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities, and

4. prepared the annual accounts on a going concern basis.

FIXED DEPOSITS

The amount outstanding as on 31st March, 2013 on account of Fixed Deposits aggregating " 68.93 lacs is yet to mature and all the deposits that matured during the year were repaid with interest due thereon and nothing remains unclaimed.

AUDITORS

Messrs Jain & Co., Chartered Accountants, Registration No. 302023E retire at the conclusion of the 30th Annual General Meeting and being eligible, have expressed their willingness to continue as Auditors of the Company, if so appointed by the members.

COST AUDIT

For the year under review Messrs A.C.Dutta & Co., Cost Accountants were appointed as Cost Auditors of the Company for conducting Cost Audit for the financial year ended March 31, 2013.

EMPLOYEE PARTICULARS

The particulars of employees pursuant to section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rule 1975, as amended by Companies (Particulars of Employees) Amendment Rule, 2011 are not applicable as no employee was in receipt of remuneration to the extent laid down in the said Rules.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

A statement pursuant to section 217(1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Directors) Rules, 1988 on conservation of energy, technology absorption, foreign exchange earnings and outgo is annexed to and forms part of this Report.

ACKNOWLEDGEMENT

Your Directors place on record their appreciation for the cooperation and support extended by the Employees, Banks and all other business partners. For and on behalf of the Board of Directors

Kolkata, The 13th

day of May, 2013 Umang Kanoria Chairman

 
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