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Directors Report of Lords Chloro Alkali Ltd.

Mar 31, 2014

Dear members,

The Directors are pleased to present the 35th Annual Report together with the Audited Accounts of the Company for the financial year ended on 31st March, 2014.

1. FINANCIAL RESULTS

(Rs. in Lac)

Particulars 2013-14 2012-13

Sales NIL NIL

Other Income 41.12 400.82

Operating Profit/(Loss) (232.13) 66.18 before Interest Depreciation & Exceptional Items

Interest 0.33 15.13

Depreciation 233.12 417.37

Net Profit/(Loss) (422.42) (322.88)

2. PERFORMANCE

During the year plant was closed, as the major equipments of the plant require revamp. The life of Anodes, Cathodes and Membranes has got exhausted and these require replacement. The company has executed an order with M/s. Asahi Kasei Chemicals Corporation, Japan for supply of membrane, anode, cathode etc. The delivery for these items has been started and supply of all parts will be completed shortly so that the plant can be restarted shortly.

3. MARKETING

The production of caustic soda during the year 2013-14 in India was approx 26.18 Lakh MT against 25.40 lakh MT during the year 2012-13. The installed capacity of Caustic soda has also increased by 5.6 per cent from to 33.09 -14 from 31.34 during the last financial year 2012-13.

The installed capacity utilization rate of domestic caustic soda players is 79.1 percent during the period 2013-14. The domestic demand for Caustic Soda has increased by 5 percent to 2952.2 Lakh MT during the year 2013-14 from 2813.6 Lakh MT as compared to 2012-13. The capacity utilization of Indian caustic soda industry is also expected to rise to 92 percent from 81 per cent in the next four-five year as per Crisil report 2014.

The domestic demand for caustic soda is expected to increase by 6-7% CAGR over 2014-15 to 2018-19. The demand from primary drivers ie. Alumina is likely to increase at a pace of 12-13 per cent CAGR. Further Soap, detergent and paper industries are expected to increase by and 5-6 per cent CAGR. The above said segments contribute 42 per cent of the total demand in the country.

Further rise in utilization rate shall be capped as the growth in demand for chlorine will be lower at 5-6 percent CAGR viz-a-viz the 6-7 percent CAGR rise in caustic soda demand as per Crisil report 2014.

CRISIL also forecast that Caustic Soda demand shall continue to grow at healthy pace up to 2018-19.

4. FUTURE OUTLOOK

The manufacturing sector is showing positive signs of revival after few years. The production of Aluminum, paper, Soap and detergents, textiles will get a boost resulting in higher demand for our products.

The company has already undertaken the revamping and refurbishing of the existing Caustic soda facilities of 107 TPD and shall subsequently achieving the total installed capacity of 334 TPD by revamping the balance facilities.. For this purpose the company will meet out the funds requirement from investment through promoters contribution, internal accruals and sourcing from banks and financial institutions after streamlining of 107 TPD Caustic Soda Plant.

Further, the company is also focused on forward integration in the field of Chlorine by manufacturing of value added chlorine derivatives at a later stage. These measures are expected to bring in added advantage and competitive act as a cushion against demand-price fluctuations in the market.

5. DIRECTORS

In accordance with the provisions of the New Companies Act, 2013, Shri Rakesh Ahuja, is retire by rotation at the ensuing Annual General Meeting and received the eligible offer from himself for re-appointment.

The Company has received requisite notices in writing from members proposing Shri Pawan Kumar Nayyar, Shri Rajbir Singh Makhni, Shri Sandeep Chaudhari, Shri Chandra Shakher Pathak, Mrs. Poonam Rawat and Shri Shiv Dutt Sharma as an Independent Directors.

6. AUDITOR''S OBSERVATION

In reference to the Comments mentioned in the the Auditors Report for the year 2013-14, we wish to submit the following:

(i) Company was a Sick Industrial Company and Hon''ble BIFR has sanctioned a scheme on 30th Nov. 2006. Subsequently the scheme was successfully implemented and the company has revived. The BIFR accordingly has deregistered the company from its purview in March 2010. All the liabilities have been restructured as per the provisions of the rehabilitation scheme. Company has received confirmation letters from various parties, however we are still waiting confirmation from some of the parties, therefore some balances could not be ascertained.

(ii) Company has not received all the records from old Management. We are in the process of reconciliation the records. We shall deposit the whole amount in the Investor Education and Protection Fund (lEPF) as soon as records are reconciled.

7. AUDITORS

M/s. Gupta Vigg & Co., Chartered Accountants, Auditors of the Company, hold office until the conclusion of ensuing Annual General Meeting and are recommended for re-appointment. Certificate from the Auditors have been received to the effect that their re-appointment, if made, would be within the limits prescribed under section 141 of the Companies Act, 2013.

8. COST AUDITORS

In accordance with section 148 of the Companies Act, 2013, and subject to approval of the Central Government, the Company has reappointed M/s. Goyal, Goyal & Associates, Cost Accountants, New Delhi, as Cost Auditors to conduct the cost audit of the accounts relating to its products for the financial year 2014-15. The Company has submitted the necessary e forms/documents with the MCA for obtaining the approval from the Central Government.

9. SAFETY, ENVIRONMENT PROTECTION & POLLUTION CONTROL

The Company is implementing new membrane water purifier plant, which will result in recycling of and which will also bring down the dosing of chemicals resulting good environment practice.

10. PARTICULARS OF EMPLOYEES

Information as required under section 217(2A) of the Companies Act, 1956, read with Companies (particulars of employees) Rules, 1975 as amended. There is no employee covered under the above section.

11. INDUSTRIAL RELATIONS

Cordial Industrial relations and improvement in productivity were maintained at the Company''s Plant and Office and your management appreciates the support of employees/ workers at all levels for their dedicated services to achieve the performance.

12. DIRECTORS'' RESPONSIBILITY STATEMENT

Your Directors wish to inform that the audited accounts containing financial statement for the financial year 31st March, 2014 are in full conformity with the requirement of the Companies Act, 1956.

Directors believe that the financial statements reflect fairly, the forms and substance of the transactions carried out during the year and reasonably present the Company''s financial condition and result of operations.

Pursuant to Section 217(2AA) of the Companies Act, 1956 as amended by the Companies (Amendment) Act, 2000 the directors of the Company declare as under:

(i) that in the preparation of the Annual Accounts, the applicable Accounting Standard have been followed along with proper explanation relating to material departures.

(ii) that the directors had selected such 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 loss of the Company for that period.

(iii) that the directors had taken proper and sufficient care 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.

(iv) that the directors had prepared the annual accounts on a going concern basis.

13. corporate governance report

A Report on Corporate Governance forms part of this Report. The Management Discussion & Analysis Report and the Certificate from the Practicing Company Secretary confirming the compliance with Clause 49 of the Listing Agreement relating to Corporate Governance is also annexed to the Report.

In compliance with the requirement of clause 49 (V), a certificate from Managing Director and CFO was placed before the Board.

14. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGOING.

In compliance with provisions of clause (e) of sub-section (1) of Section 217 of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 the statements giving the required information relating to energy conservation, technology absorption, foreign exchange earnings and outgoings are annexed hereto.

15. FIXED DEPOSIT

During the year under review, the Company did not raise funds by the way of fixed deposits and no such amount of principle or interest was outstanding as on the date of balance sheet.

16. acknowledgement

Your Directors wish to convey their deep appreciation to all the company''s employees/workers for their dedication and hard work as well as their collective contribution to the Company''s performance.

The Directors would also like to thanks to the Shareholders, Customers, Dealers, Suppliers, Bankers, Financial Institutions, Government Authorities and all other business associates for continued support given by them to the Company and their confidence in its management.

For and on behalf of the Board FOR LORDS CHLORO ALKALI LTD

(Ajay Virmani) (Alok Dhir) (Rakesh Ahuja) Mg. Director Director Director

Place : New Delhi Date : 30-05-2014


Mar 31, 2011

The Directors are pleased to present the 32nd Annual Report together with the Audited Accounts of the Company for the financial year ended on 31st March, 2011.

1. FINANCIAL RESULTS

The comparative financial results of the company are given below:

(Rs. in lac)

Particulars 2010-11 2009-10

Sales 13264.34 11428.60

Other Income 233.00 994.42

Operating Profit / (Loss) before Interest, 836.79 518.79 Depreciation & Exceptional Items

Interest 53.99 14.27

Depreciation 491.11 521.67

Net Profit/(Loss) 139.46 (10.70)

2. PERFORMANCE

Your Company has achieved the Gross Turnover of Rs. 13264 lack during the year 2010-11 as compare to Rs. 11429 lack (previous year) an increase of 16%.

The Company has restarted manufacturing TriChloro Ethylene (TCE) and sold 1230 MT of TCE during the year, which contributes to turnover of Rs. 968 Lac.

The sale of Hydrogen Gas has also increased to 93 MT from 58 MT as compared to last year, which contributes to additional revenue of Rs.31 lac.

The Company has taken steps for revamping and refurbishing the plant for increasing efficiency and Capacity, resulting in reduction of Cost of Production and increase the profitability.

3. ACHIEVEMENTS, AWARDS AND APPRICIATIONS

Persons coming forward with schemes and suggestions to reduce pollution levels, increase efficiencies of different equipments, are being appreciated and suitably rewarded.

4. RESUMPTION OF TRADING OF EQUITY SHARES AT BSE

Your directors are pleased to inform that Bombay Stock Exchange vide its notice dated 29th March 2010, has revoked the suspension of Trading of equity Shares of the company w.e.f 5th April 2010. The trading of Shares resumed in Category.

5. Marketing

The Company is engaged in the manufacture and sale of Caustic Soda and its related products viz. Chlorine, Hydrochloric Acid, Calcium Hypo Chloride, Hydrogen Gas, Stable Bleaching Powder (SBP) and Trichloro Ethyline (TCE).

Your Company is supplying Caustic Soda Lye and Chlorine to various companies in the organized sectors i.e. M/s. Hindustan Unilever Ltd. (HUL), M/s. Godrej Consumer Products Ltd., M/s. SRF Ltd. (SRF). During the year, the Company has added the new customers - M/s. Indian Oil Corporation.

In view of product mix, we are able to drive the benefit of better Chlorine realization by increasing the production of Stable Bleaching Powder and Trichloroethylene as and when the Chlorine realization is lower, thereby maximizing Company ECU realizations.

During the year, the Company has reported the total sales of products of Rs. 13264.34 lack in comparison to previous year Rs. 11428.60 lac.

6. EXPANSION PROJECT

We are pleased to inform that your company has re-started the production of TriChloro Ethylene (TCE) in the month of June 2010 and are in the process to increase the capacity by installing 3rd Reactor. Thereafter, the total capacity of TCE will be increased to 300 MT per month.

The Company is in process of refurbishing and revamping of existing Caustic Soda Capacity of 227 TPD and thereafter, the remaining capacity of 110 TPD of Caustic Soda will be commissioned during the year, for which your company is approaching to the bankers for Term Loan Assistance.

The Company is proposing to invest in Sodium Hypo Plant for better and comprehensive treatment of Waste Chlorine.

7. FUTURE OUTLOOK

The Company is continuing its endeavour to reduce its costs and utilizing the existing installed capacity of Caustic Soda, Stable Bleaching Powder (SBP), TriChloro Ethylene (TCE) etc.

The Company is making investment through own funds, unsecured loan and term loan to refurbish the existing plant and stabilize the production at 225 TPD in near future. After refurbishing, the break downs will reduce, resulting in cost savings and enhancement of profitability.

The Company has restarted the production of TriChloro Ethylene (TCE) which will be increased to 300 MT per month in the near future.

The Company is in the process of stabilizing the production of Caustic Soda and Stable Bleaching Powder and the actual production is expected to be increased to 60,000 MT and 8,000 MT respectively in 2011-12.

To reduce the power and fuel cost further, your Company is entering into a Power Trading Agreement.

The Company is proposing to invest for installing Sodium Hypo Plant for better treatment and comprehensive treatment of Waste Chlorine.

In the last five years, the Company has maintained cordial relationship with its workforce and taken initiatives to boost the morale and team spirits. The Company has been able to effectively manage its workforce, both own and contractual, to obtain amongst the highest efficiencies. The Company is continuing its endeavour to establish harmonious relations with its team to achieve the performance.

8. DIRECTORS

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Shri Sandeep Chowdhary & Shri Pawan Kumar Nayyar retire by rotation at the ensuing Annual General Meeting and being eligible offered themselves for re-appointment.

Shri Jeevesh Kumar was appointed as an additional director on the Board and appointed as Director (Corporate Strategy) w.e.f. 30.07.2010.

Shri S.M Sharma, Director of the Company has resigned from the Board w.e.f. 29.10.2010, Board of Directors placed their appreciation on the record for the services and guidance rendered by him to the company during his tenure as the Director of the Company.

9. AUDITORS' OBSERVATIONS

In reference to the Comments mentioned in the para 4(I) and (II) of the Auditors Report for the year 2010-11, we wish to submit the following:

(I) Company was a sick Industrial company and Hon'ble BIFR has sanctioned a scheme on 30th Nov. 2006 .Subsequently the scheme was successfully implemented and the company has revived. The BIFR accordingly has deregistered the company from its purview in March 2010. All the liabilities have been restructured as per the provisions of the rehabilitation scheme. Company has received confirmation letters from various parties, however we are still waiting confirmation from some of the parties, therefore some balances could not be ascertained.

(II) Company has not received all the records from old Management. We are in the process of reconciliation the records. We shall deposit the whole amount in the Investor Education and Protection Fund (IEPF) as soon as records are reconciled.

10. AUDITORS

M/s. Alag Kumar & Associates, Chartered Accountants, Auditors of the Company, hold office until the conclusion of ensuing Annual General Meeting and are recommended for re-appointment. Certificate from the Auditors have been received to the effect that their re-appointment, if made, would be within the limits prescribed under section 224(1B) of the Companies Act, 1956.

11. COST AUDITORS

In accordance with section 233B of the Companies Act, 1956, and subject to approval of the Central Government, the Company has reappointed M/s. Goyal, Goyal & Associates, Cost Accountants, New Delhi, as Cost Auditors to conduct the cost audit of the accounts relating to its products for the financial year 2011-12. The Company has obtained the approval for the same from the Central Government.

12. SAFETY, ENVIRONMETN PROTECTION & POLLUTION CONTROL

The Company continues to give priority to safety and pollution control measures. It has been strictly following the requisite guidelines as received from the Pollution Control Board.

Pollution Control being one of the important point in our quality policy. We are putting maximum efforts and taking utmost care to ensure that surrounding environment is not getting polluted during the process of manufacturing our main and by-products.

Few other efforts being put areas under:

On the awareness front, employees are being given training as regards the handling of the products and by-products. We have already worked out HAZOP Study and continuously adopting the plan to avoid confusion for action to be taken in case of a sudden release of chlorine or similar harmful chemicals. The transporters and personals involved in the process of transportation have been trained to handle all sorts of problems which can arrive during the process of transportation. A culture has been inculcated wherein all employees are encouraged to use personal protective equipments. As a token of indication of pollution free atmosphere, we are maintaining greenery right in the heart of the plant. We have installed air sampling points at all strategic locations and continuous monitoring of air to ensure pollution free atmosphere. Chlorine sensors have been installed at different location of the plant for monitoring of Chlorine emission to proper control of pollution.

Company further planning to replace WAD unit from Calcium Hypo (Lime based) to Sodium Hypo (Caustic Soda based) for efficient and pollution free gas neutralization system.

500 KVA DG Set new engine replaced which compiles to the latest requirements of Pollution Control Regulations.

13. PARTICULARS OF EMPLOYEES

Information as required under section 217(2A) of the Companies Act, 1956, read with Companies (particulars of employees) Rules,1975 amended on 31.03.2011. There is no employee covered under the above section.

14. INDUSTRIAL RELATIONS

Cordial Industrial relations and improvement in productivity were maintained at the Company's Plant and Office and your management appreciates the support of employees/ workers at all levels for their dedicated services to achieve the performance.

15. DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors wish to inform that the audited accounts containing financial statement for the financial year 31st March, 2011 are in full conformity with the requirement of the Companies Act, 1956.

Directors believe that the financial statements reflect fairly, the forms and substance of the transactions carried out during the year and reasonably present the Company's financial condition and result of operations.

Pursuant to Section 217(2AA) of the Companies Act, 1956 as amended by the Companies (Amendment) Act, 2000 the directors of the Company declare as under:

(i) that in the preparation of the Annual Accounts, the applicable Accounting Standard have been followed along with proper explanation relating to material departures.

(ii) that the directors had selected such 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 profit of the Company for that period.

(iii) that the directors had taken proper and sufficient care 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.

(iv) that the directors had prepared the annual accounts on a going concern basis.

16. CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance forms part of this Report. The Management Discussion & Analysis Report and the Certificate from the Practicing Company Secretary confirming the compliance with Clause 49 of the Listing Agreement relating to Corporate Governance is also annexed to the Report.

In compliance with the requirement of clause 49 (V), a certificate from Executive Director & CEO and Chief Financial Officer was placed before the Board.

17. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGOING.

In compliance with provisions of clause (e) of sub-section (1) of Section 217 of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 the statements giving the required information relating to energy conservation, technology absorption, foreign exchange earnings and outgoings are annexed hereto.

18. FIXED DEPOSIT

During the year under review, the Company did not raise funds by the way of fixed deposits and no such amount of principle or interest was outstanding as on the date of balance sheet.

19. ACKNOWLEDGEMENT

Your Directors wish to convey their deep appreciation to all the company's employees/workers for their dedication and hard work as well as their collective contribution to the Company's performance.

The Directors would also like to thanks to the Shareholders, Customers, Dealers, Suppliers, Bankers, Financial Institutions, Government Authorities and all other business associates for continued support given by them to the Company and their confidence in its management.

For and on behalf of the Board Place: New Delhi (Laxmi Paul Dhir) (Ashok Kumar)

Date: 30.04.2011 Chairman Managing Director


Mar 31, 2010

The Directors are pleased to present the 31st Annual Report together with the Audited Accounts of the Company for the financial year ended on 31st March, 2010.

1. FINANCIAL RESULTSs

The comparative financial results of the company are given below:

(Rs. in lac)

2009-10 2008-09

Sales 11428.60 12970.85

Other Income 994.42 123.09

Operating Profit / (Loss) before Interest,

Depreciation & Exceptional Items 518.79 1373.12

Interest 14.27 0.89

Depreciation 521.67 593.98

Net Profit/(Loss) (10.70) 397.42

2. PERFORMANCE

Your Company has achieved a better capacity utilization and optimizing efficiencies in plant during the year ended on 31st March 2010.

The Company has taken steps for revamping the plant, increasing effciency and increasing capacity of the plant, to bring down the Cost of Production.

During the year under review, your Company has achieved production of 51812 MT Caustic Soda as against 44840 MT (previous year), a rise of 16% over last year. Gross Turnover was Rs.11428.60 lac as against of Rs. 12970.85 lac last year. However, despite higher production & Sale, the turnover as well as Profitability of the company has been lower due to fall in price of the products triggered by recessionary trends around the world, resulting in, the company has incurred a Net Loss of Rs. 10.70 lac as against Net Profit of Rs. 397.42 lac in the last year.

3 ACHIEVEMENTS, AWARDS AND APPRECIATIONS

Your directors are pleased to inform that in recognition of its continuous journey of excellence, your company has achieved a prestigious ENERGY CONSERVATION AWARD (First Prize) for its outstanding performance in the feld of ENERGY CONSERVATION, awarded by the Government of Rajasthan for the year 2008-09.

Persons coming forward with schemes and suggestions to reduce pollution levels, increase efficiencies of different equipments and machines are being appreciated and suitably rewarded.

4. RESUMPTION OF TRADING OF EQUITY SHARES AT BSE

Your directors are pleased to inform that Bombay Stock Exchange vide its notice dated 29th March 2010, has revoked the suspension of Trading of equity shares of the company w.e.f. 5th April 2010. The trading of shares resumed in T Category.

5. BIFR STATUS / SANCTIONED SCHEME

The Honble BIFR vide its order dated 30th November 2006 sanctioned a Rehabilitation Scheme with some reliefs and concessions. The Scheme envisages grant of reliefs and concessions from Secured Lenders, Central Government, Government of Rajasthan, Provident Fund Authorities, ESI Authorities, Existing Promoters, Strategic Investors and other statutory authorities etc. On the basis of the reliefs and concessions as envisaged in the Scheme, the company is approaching to the appropriate authorities and financial institutions.

During the year, your Company has De-registered from the purview of BIFR in the month of March 2010. The Hble BIFR while passing the order directed that:

"The un-implemented provisions of the Sanctioned Scheme (SS-09) if any, should be implemented by the concerned agencies and their implementation would be monitored by the company M/s Lords Chloro Alkali Limited".

Implementation of the BIFR Scheme is under progress.

6. MARKETING

The Company is engaged in the manufacture and sale of Caustic Soda and its related products viz. Chlorine, Hydrochloric Acid, Calcium Hypo Chloride, Hydrogen Gas, Stable Bleaching Powder (SBP) and Tri Chloro Ethyline (TCE).

The product-wise sales are given below :

SALES

Product 2009-10 2008-09 Value Value Quantity (mt) Quantity (mt) (Rs. in lac) (Rs.in lac)

Caustic Soda 50579 9317.07 43489 10884.20

Liquid Chlorine 37037 1390.37 29268 1109.16

Hydrochloric Acid 7410 88.54 13992 178.92

Calcium Hypo Chloride 10509 21.49 13789 48.20

Stable Bleaching Powder (SBP) 6269 557.45 7241 643.87

Hydrogen Gas 58 48.99 74 65.39

Tri Chloro Ethylene ( TCE) 7 4.69 66 41.11

Total 11428.60 12970.85

7. EXPANSION PROJECT

We are pleased to inform that your company has re-started the production of Tri-Chloro- Ethylene (TCE) in the month of June 2010.

The Company will commission the remaining capacity of 130 TPD of Caustic Soda in the next year, for which we are approaching to bank for Term Loan Assistance.

8. FUTURE OUTLOOK

The Company is continuing its endeavor to reduce its costs and utilizing the existing installed capacity of Caustic Soda, Stable Bleaching Powder (SBP), Tri Chloro Ethylene (TCE) etc.

The Company is making investment through own funds, unsecured loan and term loan to refurbish the existing plant and stabilize the production at 225 TPD in near future. After refurbishing, the break downs will reduce, resulting in cost savings and enhancement of Profitability.

The Company has restarted the production of Tri Chloro Ethylene (TCE) which will be increased to 400 MT per month in the near future.

The Company is in the process of stabilizing the production of Caustic Soda and Stable Bleaching Powder and the actual production is expected to be increased to 60,000 MT and 8,000 MT respectively in 2010-11.

To reduce the power and fuel cost further, your Company is entering into a Power Trading Agreement.

The Company is proposing to invest for installing Sodium Hypo Plant for better treatment and comprehensive treatment of Waste Chlorine.

Small and medium entrepreneur have approached the company for putting up Chlorine based plants in Alwar or in LCAL premises which will help the company to utilize its co-products to the maximum and the same is under progress.

In the last fve years, the Company has maintained cordial relationship with its workforce and taken initiatives to boost the morale and team spirits. The Company has been able to effectively manage its workforce, both own and contractual, to obtain amongst the highest efficiencies. The Company is continuing its endeavor to establish harmonious relations with its team to achieve the performance.

9. DIRECTORS

In accordance with the provision of Section 256 & 257 of the Companies Act, 1956, Shri Rakesh Ahuja, Director retires from Office by rotation and being appointed as Director by the members in the Annual General Meeting held on 22.06.2010.

In accordance with the provision of Section 256 & 257 of the Companies Act, 1956, Shri Sandeep Chaudhari was appointed as Director in place of Shri Ravi Kathpalia, who has retired by rotation.

Shri Laxmi Paul Dhir, Shri Krishan Lal Batra, Shri Sri Mohan Sharma, Shri Ajay Virmani and Shri Yuvraj Ahuja, appointed as an Additional Director by the Board w.e.f. 14.05.2010 and they have been appointed as Directors by the members in the Annual General Meeting held on 22.06.2010.

Shri Nilesh Sharma, Director of the Company has resigned from the Board w.e.f. 14.05.2010.

Shri Shiv Dutt Sharma, Shri Rajbir Singh Makhni, Shri Shyam Chowdhary and Shri Chandra Shakher Pathak appointed as an Additional Directors by the Board w.e.f. 30.06.2010 and will hold the Office upto the date of next Annual General Meeting held in next financial year 2010-11.

Board of Directors welcome all new Directors and placed its appreciation on record for the services and guidance rendered by Shri Ravi Kathpalia as Chairman and Shri Nilesh Sharma as Director during their tenure to the Company.

10. AUDITORS OBSERVATIONS

In reference to the Comments mentioned in the para 4A(i) & (ii) and 4B (i) & (ii) of the Auditors Report for the year 2009-10, we wish to submit the following:

i. With respect to the observation regarding non conformation of certain balances of current assets, sundry debtors, loans and advances and current liabilities including secured creditors, it is submited that the company is a sick company and Hon`ble BIFR has sanctioned a scheme on 30th Nov. 2006. All the liabilities have been restructured as per the provisions of the rehabilitation scheme. The company has received confrmation letters from various parties, however, we are still waiting confrmation from some of the parties, therefore, some balances are subject to confrmation. We are trying to reconcile the said balance with the concerned parties.

ii. With respect to non transfer of the amount of Rs. 11.64 lac to the Investor Education and Protection Fund (IEPF), it is stated that certain papers and documents relating to this transaction are not available and as soon as the records are reconciled, we will transfer/deposit the said amount.

iii. The company has entered into an Agreement for Sale of its land at Modigarh, Ramgarh District Alwar, Rajasthan for a consideration of Rs. 625 lac and on receipt of advance the possession has been handed over to the vendee. As per the terms of agreement, total consideration has to be received by 30th September 2010. The company has received part payment by March 2010. Subsequently, substantial payment amounting to Rs. 500 lacs has already been received by the company by the date of completion of audit. As substantial payment has been receipt and the possession has also been handed over in terms of the Agreement to sell dated 25th March 2010, the company has recognized the sale of the asset u/s 53A of the Transfer of Property Act, 1882.

iv, The company has started trading activities of Caustic Soda and other Items during the year 2009- 10. In some of the transactions, vender failed to deliver the goods as agreed. However, company was able to enforce the damages on them and the counter party has given the credit notes and confrmatory letters and substantial payments has also been received by the date of the completion of audit, accordingly, the same has been recorded in the books of accounts as other income on 31st March, 2010.

11. AUDITORS

M/s. Alag Kumar & Associates, Chartered Accountants, Auditors of the Company, hold Office until the conclusion of ensuing Annual General Meeting and are recommended for re-appointment. Certifcate from the Auditors have been received to the effect that their re-appointment, if made, would be within the limits prescribed under section 224(1B) of the Companies Act, 1956.

12. COST AUDITORS

In accordance with section 233B of the Companies Act, 1956, and subject to approval of the Central Government, the Company has re-appointed M/s. Goyal, Goyal & Associates, Cost Accountants, New Delhi, as Cost Auditors to conduct the cost audit of the accounts relating to its products for the financial year 2010-11. The Company has obtained the approval for the same from the Central Government.

13. SAFETY, ENVIRONMENT PROTECTION & POLLUTION CONTROL

The Company continues to give priority to safety and pollution control measures. It has been strictly following the requisite guidelines as received from the Pollution Control Board.

Pollution Control being one of the important point in our quality policy. We are putting maximum efforts and taking utmost care to ensure that surrounding environment is not getting polluted during the process of manufacturing our main and by-products.

Few other efforts being put are as under:

On the awareness front, employees are being given training as regards the handling of the products and by-products. We have already worked out HAZOP Study and continuously adopting the plan to avoid confusion for action to be taken in case of a sudden release of chlorine or similar harmful chemicals. The transporters and personals involved in the process of transportation have been trained to handle all sorts of problems which can arrive during the process of transportation. A culture has been inculcated wherein all employees are encouraged to use personal protective equipments. As a token of indication of pollution free atmosphere, we are maintaining greenery right in the heart of the plant. We have installed air sampling points at all strategic locations and continuous monitoring of air to ensure pollution free atmosphere. Chlorine sensors have been installed at different location of the plant for monitoring of Chlorine emission to proper control of pollution.

14. PARTICULARS OF EMPLOYEES

Information as required under section 217(2A) of the Companies Act, 1956, read with Companies (particulars of employees) Rules,1975 as amended, the names and other particulars of employees are set out in the annexure to the Directors Report.

15. INDUSTRIAL RELATIONS

Cordial Industrial relations and improvement in productivity were maintained at the Companys Plant and Office and your management appreciates the support of employees/ workers at all levels for their dedicated services to achieve the performance.

16. DIRECTORS RESPONSIBILITY STATEMENT

Your Directors wish to inform that the audited accounts containing financial statement for the financial year 31st March, 2010 are in full conformity with the requirement of the Companies Act, 1956.

Directors believe that the financial statements refect fairly, the forms and substance of the transactions carried out during the year and reasonably present the Companys financial condition and result of operations.

Pursuant to Section 217(2AA) of the Companies Act, 1956 as amended by the Companies (Amendment) Act, 2000 the directors of the Company declare as under:

i. that in the preparation of the Annual Accounts, the applicable Accounting Standard have been followed along with proper explanation relating to material departures.

ii. that the directors had selected such 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 Profit or loss of the Company for that period.

iii. that the directors had taken proper and suffcient care 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.

iv. that the directors had prepared the annual accounts on a going concern basis.

17. CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance forms part of this Report. The Management Discussion & Analysis Report and the Certifcate from the Practicing Company Secretary confrming the compliance with Clause 49 of the Listing Agreement relating to Corporate Governance is also annexed to the Report.

In compliance with the requirement of clause 49 (V), a certifcate from Executive Director & CEO and Chief Financial Officer was placed before the Board.

18. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING AND OUTGOING.

In compliance with provisions of clause (e) of sub-section (1) of Section 217 of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 the statements giving the required information relating to energy conservation, technology absorption, foreign exchange earnings and outgoings are annexed hereto.

19. FIXED DEPOSIT

During the year under review, the Company did not raise funds by the way of fixed deposits and no such amount of principle or interest was outstanding as on the date of balance sheet.

20. ACKNOWLEDGEMENT

Your Directors wish to convey their deep appreciation to all the companys employees/workers for their dedication and hard work as well as their collective contribution to the Companys performance.

The Directors would also like to thanks to the Shareholders, Customers, Dealers, Suppliers, Bankers, Financial Institutions, Government Authorities and all other business associates for continued support given by them to the Company and their confdence in its management.

For and on behalf of the Board

(Laxmi Paul dhir) Chairman

Place : New Delhi Date : 03.09.2010

 
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