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Directors Report of Modi Rubber Ltd.

Mar 31, 2014

Dear members,

The Directors present the 41st Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31st March, 2014.

IMPLEMENTATION STATUS OF BIFR SCHEME

Your Company was discharged by BIFR vide its order dated 23.02.2010. In terms of the conditions thereof and BIFR''s order dated 23.02.2010, your Company has been implementing the unimplemented portion of the revival scheme sanctioned by the BIFR.

In this respect, rehabilitation for Modinagar Tyre Factory (MTF) could not be achieved as yet. The matter for possession of MTF Plant is pending with Hon''ble Allahabad High Court. The Plant continues to be in possession of the OL appointed by the Allahabad High Court in Modi Export Processors Limited''s (MEPL) winding up proceedings. Litigation is also pending with 3-4 creditors who have till date not accepted the dues as per scheme sanctioned by the BIFR.

Your Company has been following up with UP Govt., other state Govt. and Govt agencies/authorities/department/Creditors to provide relief and concessions and to accept settlement as per scheme sanctioned by the BIFR.

The Company has taken new initiatives to improve its long term prospects and performance. These include:-

1) Your Company has been very vigorously taking actions to get re-possession of Company''s properties which were occupied by illegal occupants/Ex-Employees. Efforts include legal recourse, and also settlement as possible wherever possible.

2) Company is taking several steps to utilize its real-estate resources and wherever possible to put them to generate revenue.

3) The Company has made an Investment in a Joint Venture Asahi Modi Materials Private Limited.

4) The Company is exploring additional avenues of investment in potential Joint Ventures.

FINANCIAL RESULTS

During the year under review, your company has recorded a net profit after tax Rs. 124.21 Lacs as compared to Rs. 2727.68 Lacs in previous year on a total income of Rs. 2278.32Lacs as compared to 5429.13Lacs in the previous year.

Since, there is inadequate profit, your Board does not recommend any dividend.

FIXED DEPOSITS

The Company has not accepted any fixed deposits from public during the year under review.

BOARD OF DIRECTORS

Pursuant to section 149 and other applicable provisions of the Companies Act, 2013, your Directors are seeking appointment of Mr. Kawaljit Singh Bains (DIN 01444259) and Mr. Neeraj Sharma (DIN 03077684) as Independent Directors for five consecutive years for a term upto September 29th 2019 in terms of the Companies Act, 2013.

Ms. Piya Modi (DIN 03623417) was appointed as an additional Director of the Company w.e.f. 08.08.2014 to hold the office upto the ensuing Annual General meeting of the Company. The Company has received a notice along with a deposit of Rs. one lakh, as provided under section 160 of the Companies Act, 2013 from a member proposing her candidature for appointment as a Director who is liable to retire by rotation. In the same meeting Ms. Piya Modi (DIN-03623417) was also appointed as the Whole-Time Director and designated as Executive Director/Chief Executive Officer w.e.f. 1st October, 2014 on terms and conditions detailed in the notice.

Brief resume of the above directors proposed to be appointed, nature of their expertise in specific functional areas and the names of the Public Companies in which they hold the Directorship and the Chairmanship / membership of the Committee of the Board, as stipulated in clause 49 of the Listing Agreement forms a part of the Notice of this Annual General Meeting.

Pursuant to the provisions of the Companies Act, 2013 and in accordance with the Articles of Association of the Company, Mr. Sanjiwan Sahni (DIN 01050255) Director of the Company is liable due to retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. The Chairman and Managing Director are non retiring directors in terms of the Articles of Association.

None of the Directors of your Company is disqualified as per the provisions of Section 164(2) of the Companies Act, 2013.

DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956, the Directors of your Company declare as under

(i) that in the preparation of the annual accounts, the applicable accounting standards 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 of the Profit or 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 this act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; The same has been certified by the auditors in their annexure to audit report stating therein that no serious discrepancies between the book records and physical quantity have been noticed.

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

AUDITORS

M/s.PDM and Company, Chartered Accountants, (Firm Registration No 007966N) New Delhi, Statutory Auditors of your Company shall retire at the conclusion of the ensuing Annual General Meeting and being eligible offers themselves for re-appointment as Statutory Auditors for FY15.

Under section 139 of the Companies Act, 2013 Statutory Auditors of every listed Company who have completed a term of 10 years or more will not be eligible for re-appointment as statutory Auditors. However, the existing Companies have been allowed to comply with the new requirements of this section within 3 years from the date of commencement of the Companies Act, 2013.

The existing Statutory Auditors of the Company has already completed a term of 10 years.

The Company has received a letter from the auditors confirming that they are eligible for appointment as auditors of the Company under section 139 of the Companies Act, 2013, and meet the criteria for appointment specified in section 141 of the Companies, Act 2013. Based on the recommendation of the Audit committee, the Board of Directors of the company proposes the re-appointment of M/s PDM and Company, Chartered Accountants as the Statutory Auditors of the Company for a period of 3 years from FY 15 to FY17.

Auditors'' observations in their Report have been elaborately dealt with in the Auditors'' Report / Notes on Accounts. The same are self explanatory and do not need any more information/explanation.

Cost Accounting Record Rules and Cost Audit Report Rules are not applicable due to suspension/closure of the plant.

SUBSIDIARY COMPANIES

As per the provisions of section 212 of the Companies Act, 1956 your Company is required to attach the Director''s Report, Balance Sheet, Profit & loss Account and other information of subsidiary Companies to its Balance Sheet. However, the Ministry of Corporate Affairs, Government of India has, vide its circular No.2 and 3 dated February 8, 2011 and February 21, 2011 respectively, granted a general exemption from compliance with section 212(8) of the Companies, Act, 1956 from attaching Annual Accounts of subsidiaries in the annual published accounts of the Company subject to the fulfillment of conditions stipulated in the said circulars. Your Company meets all the conditions stated in the aforesaid circulars, and therefore, the standalone, financial statements of each subsidiary are not annexed with the annual report for the FY 14.

A Statement containing brief financial details of the two wholly owned subsidiaries namely M/s Spin Investment India Limited and M/s Superior Investment (India) Limited of the Company for the year ended March 31, 2014 forms part of the annual report. As required, pursuant to the provisions of section 212 of the Companies Act, 1956, a statement containing the holding''s interest in the subsidiary Companies forms part of the annual report.

STATUTORY DISCLOSURES

During the year under review, there was no employee for the purpose of Section 217(2A) of the Companies Act, 1956. Since there was no production, there is no information required to be given for energy conservation, technology absorption, fuel consumption etc. u/s 217 (1) (e) of the Companies Act, 1956. Information about foreign exchange earnings is nil and outgo is Rs. 41.46 Lacs during the year under review.

CORPORATE GOVERNANCE

As per applicable provisions of Clause 49 of the listing agreement with Stock Exchanges, a Management Discussion & Analysis Report, and a Report of Corporate Governance together with Auditors'' Certificate form part of the Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

Requisite Consolidated Financial Statements of the Company along with its Subsidiaries are attached and form part of this Report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks for support and co-operation from the Hon''ble BIFR/AAIFR, Banks, UP Government and other Government Authorities and shareholders during the year under review. Your Directors also appreciate services of executives and staff of the Company for unstinted support in revival of the Company.



For and on behalf of the Board

Place : New Delhi Vinay Kumar Modi Date : August 08, 2014 Chairman


Mar 31, 2013

The Directors present the 40th Annual Report together with the Audited Statement of Accounts of the Company for the period ended 31st March, 2013.

IMPLEMENTATION STATUS OF BIFR SCHEME

Your Company was discharged from the purview of BIFR vide its order dated 23.02.2010. In terms of the conditions thereof and BIFR''s order dated 23.02.2010, your Company has been implementing the unimplemented portion of the revival scheme sanctioned by the BIFR.

In this respect, rehabilitation for Modinagar Tyre Factory (MTF) could not be achieved as yet. The matter for possession of MTF Plant is pending with Hon''ble Allahabad High Court. The Plant continues to be in possession of the OL appointed by the Allahabad High Court in Modi Export Processors Limited''s (MEPL) winding up proceedings. Litigation is also pending with 3/4 creditors who have till date not accepted the dues as per scheme sanctioned by the BIFR. The Company has taken new initiatives to improve its long term prospects and performance. These include:

Your company has entered into a joint venture collaboration agreement with M/s Asahi Organic Chemicals Industry Co Ltd. (AOC) for setting up in Gujarat a Resins Coated Sand (RCS) project. RCS is primarily used in the automobile industry. AOC is one of Japan''s leading companies in this sphere. Land has been allotted to the Joint Venture Company and a Test Plant has started producing products for trial to OEMs from August 2013 and construction on the Main Plant is expected to commence during the current year and commercial production is expected to commence in the next fnancial year. During the period under review, in order to make best use of its real estate resources your company has put Guest House Facility at Modipuram in commercial use after obtaining requisite approvals from the concerned Authorities. Your Directors hope to do well in this new venture during the current year.

The company is taking several steps to utilize its real estate resources. It has initiated steps to develop projects on vacant land. Existing properties are also being put to commercial use to generate revenues.

Your company has obtained approvals from ROC for extension of AGM and Financial year to 18 months.

FINANCIAL RESULTS

During the period under review, your company has recorded a net proft 2727.68 lacs as compared to 4919.55 lacs in previous year on a total income of Rs 5429.13 lacs as compared to 9654.08 lacs in the previous year mainly from sale of Investments, assets and interest & dividend.

BOARD OF DIRECTORS

Mr. Arvind Nath Seth resigned from the Board of Directors of the Company with effective from 17th December 2012. Mr. Sanjiwan Sahni & Mr. Neeraj Sharma directors of the Company are liable due to retire by rotation at the ensuing Annual General Meeting and being eligible, offers themselves for reappointment. The Chairman and Managing Director are non retiring directors in terms of the Articles of Association.

DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956, the Directors of your Company declare as under

(i) that in the preparation of the annual accounts, the applicable accounting standards have been followed alongwith 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 fnancial year and of the Proft 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 this act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; The same has been certifed by the auditors in their annexure to audit report stating therein that no serious discrepancies between the book records and physical quantity have been noticed.

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

AUDITORS

M/s.PDM & Co. Chartered Accountants, New Delhi, shall be retire as Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. Auditors'' observations in their Report have been elaborately dealt with in the Auditors'' Report / Notes on Accounts. The same are self explanatory and do not need any more information/explanation. Cost Accounting Record Rules and Cost Audit Report Rules are not applicable due to suspension/closure of the plant.

SUBSIDIARY COMPANIES

Statement under section 212 of the Companies Act, 1956 of the Company''s two wholly owned Subsidiaries, namely Spin Investment India Limited and Superior Investment (India) Limited are attached.

STATUTORY DISCLOSURES

During the period under review, there was no employee for the purpose of Section 217(2A) of the Act. Since there was no production, there is no information required to be given for energy conservation, technology absorption, fuel consumption etc. u/s 217 (1) (e) of the Act. Information about foreign exchange earnings and outgo is 43.09 Lacs during the year under review.

CORPORATE GOVERNANCE

As per applicable provisions of Clause 49 of the listing agreement with Stock Exchanges, a Management Discussion & Analysis Report, and a Report of Corporate Governance together with Auditors'' Certifcate form part of the Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

Requisite Consolidated Financial Statements of the Company along with its Subsidiaries are attached and form part of this Report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks for support and co-operation from the Hon''ble BIFR/AAIFR, Banks, UP Government and other Government Authorities and shareholders during the year period review. Your Directors also appreciate services of executives, staff and workers of the Company for unstinted support in revival of the Company.

For and on behalf of the Board

Place : New Delhi Vinay Kumar Modi

Date : August 13, 2013 Chairman


Sep 30, 2011

The Directors present the 39th Annual Report together with the Audited Statement of Accounts of the Company for the period ended 30lh September, 2011.

IMPLEMENTATION STATUS OF BIFR SCHEME

Your Board of Directors are pleased to report that your company has settled dues of almost all the creditors and has substantially implemented the revival scheme. Pursuant to direction of Learned BIFR vide its order dated 23.02.2010, the remaining and un-implemented portion of the revival scheme is under implementation. However, industrial rehabilitation for Modinagar Tyre Factory (MTF) Plant could not be achieved as yet. MTF Plant was set up on land & shed taken on perpetual lease from Modi Export Processors Ltd. (MEPL). MEPL has been liquidated by the Order of Hon'ble Allahabad High Court and Official Liquidator (OL) has put his seal on MTF Plant. Legal recourse for re possession of plant is being actively followed.

The Company has also paid dues as determined in SS08 to a majority of the workmen who have settled with the Company. Others are being persuaded to fall in line with the BIFR order. Some of the unsecured creditors have now been raising issues and not accepting dues as per scheme. Your Company has decided to approach BIFR for appropriate clarification regarding settlement of such unsecured creditors.

The volatility in raw material cost in particular rubber prices had put severe strain on the economic viability of MTCL which reported losses of Rs.176.03 crores as at 31.03.2011. In view of these losses your Board of Directors decided to divest the entire holding of shares held in MTCL to Continental Group, Germany to more effectively utilize its remaining assets and to protect the jobs of the worker/employees. Your Board decided to run its Modipuram Guest House commercially in terms of clause 15 of Memorandum & Articles of Association.

ROC vide its letter dated 08/09/2011 & 14/12/2011 respectively has accorded its approvals for extension of financial period to close on September 30lh, 2011 and also to convene AGM by March 31, 2012.

FINANCIAL RESULTS

During the period under review, your company has recorded a net profit 4919.55 lacs as compared to 345.67 lacs in previous year on a total income of Rs 9647.07 lacs as compared to 3603.43 lacs in the previous year mainly from sale of shares in MTCL and some surplus real estate, interest & dividend.

BOARD OF DIRECTORS

Mr. Vinay Kumar Modi relinquished the position of Managing Director w.e.f 31.10.2011 and in his place in terms of provisions of section 269 read with article 109 of the Company Mr. Alok Kumar Modi was appointed as the Managing Director of the Company for a period of five years. However, Mr Vinay Kumar Modi will continue to provide his services & act as Chairman of your Company. Mr. K S Bains and Mr. Arvind Nath Seth directors are due to retire by rotation at the ensuing Annual General Meeting and being eligible, offers themselves for reappointment. The Chairman & Managing Director are non retiring directors in terms of the Articles of Association.

DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956, the Directors of your Company declare as under

(i) that in the preparation of the annual accounts, the applicable accounting standards 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 of the Profit or 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 this act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; The same has been certified by the auditors in their annexure to audit report stating therein that no serious discrepancies between the book records and physical quantity have been noticed.

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

AUDITORS

M/s.PDM & Co. Chartered Accountants, New Delhi, shall be retire as Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. Auditors' observations in their Report have been elaborately dealt with in the Auditors' Report / Notes on Accounts. The same are self explanatory and do not need any more information/explanation.

Cost Accounting Record Rules and Cost Audit Report Rules are not applicable due to suspension/closure of the plant.

SUBSIDIARY COMPANIES

Statement under section 212 of the Companies Act, 1956 together with Annual reports of the Company's two wholly owned Subsidiaries, namely Spin Investment(India) Limited and Superior Investment (India) Limited are attached.

STATUTORY DISCLOSURES

During the period under review, there was no employee for the purpose of Section 217(2A) of the Act. Since there was no production, there is no information required to be given for energy conservation, technology absorption, fuel consumption etc. u/s 217 (1) (e) of the Act. Information about foreign exchange earnings and outgo is nil during the year under review.

CORPORATE GOVERNANCE

As per applicable provisions of Clause 49 of the listing agreement with Stock Exchanges, a Management Discussion & Analysis Report, and a Report of Corporate Governance together with Auditors' Certificate form part of the Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

Requisite Consolidated Financial Statements of the Company along with its Subsidiaries are attached and form part of this Report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks for support and co-operation from the Hon'ble BIFR/AAIFR, Banks, UP Government and other Government Authorities and shareholders during the period review. Your Directors also appreciate services of executives, staff and workers of the Company for unstinted support in revival of the Company.

For and on behalf of the Board Place: New Delhi Vinay Kumar Modi

Date: January 21, 2012 Chairman


Mar 31, 2010

The Directors present the 38th Annual Report together with the Audited Statement of Accounts of the Company for the year ended 31st March, 2010.

REHABILITATION SCHEME SANCTIONED BY HONBLE BIFR & PLANT OPEARTIONS

Board for Industrial & Financial Reconstruction (BIFR) sanctioned a rehabilitation scheme (SS08) for the revival of your company on April 21,2008. Modipuram and Partapur Plants (Plants) transferred to M/s Modi Tyres Company Pvt. Ltd. (MTCPL) a wholly owned subsidiary of your company have commenced production since June 2009.

Modi Tyre Factory (MTF)-Modinagar Plant which manufactures tyres other than Truck & Buses was set up by your company on land & shed which was taken from Modi Export Processors Ltd.( MEPL) on perpetual lease. MEPL has been under liquidation and an Official Liquidator (OL) was appointed by an Order of the Allahabad High Court.

The possession of MTF, Modinagar plant was received by your company, for commencement of industrial activities, on the directions passed by BIFR on 09.08.2007 u/s 29 of Sick Industrial Companies (Special Provisions) Act 1985 (SICA). The District Magistrate issued directions for handing over peaceful possession to State Bank of India (Operating Agency appointed by BIFR) which in turn handed over possession to authorized representative of your company. Thereafter all of sudden on 24.09.2007, the OL put its seal on MTF, Modinagar Plant of your company. Rent dues for the closure period of MEPL are provided in SS08. Even BIFR vide its order 23.02.2010 has clarified that MEPL rent dues are provided in the scheme and to be settled in line with other non pressing unsecured creditors category. Your company had filed a Special Appeal before the Honble Allahabad high court for de-sealing and getting back the possession of MTF Modinagar - Plant to your company which is pending for adjudication. After possession, your company shall undertake repair of plant and machineries so as to make the plant functional. In view of the above, operations at MTF plant continued to remain suspended.

Barring a few unsecured creditors, most other creditors have accepted settlement as per SS08. The Company has also paid dues as determined in SS08 to majority of workmen who settled with the company. Others are being persuaded to fall in line with the BIFR Order.

BIFR vide its order dated 23.02.2010 discharged the company from the purview of SICA/ BIFR with the direction that the unimplemented provisions of SS08 for the unexpired period of the Scheme would be implemented by the concerned agencies and their Implementation would be monitored by the company.

FINANCIAL RESULTS

During the year under review, your company has recorded a net profit of Rs. 345.67 lacs as compared to Rs. 2905.59 lacs in previous year on a total income of Rs. 3603.43 lacs, as compared to Rs. 4284.62 lacs in the previous year. The income was mainly from sale of surplus assets as per scheme, interest & dividend, sale of old stock of tyres etc. arising on implementation of SS08.

BOARD OF DIRECTORS

Mr Neeraj Sharma was appointed as additional director during the year and is eligible for re-appointment as director. Pursuant to BIFR order, Mr. S C Tripathi and Mr. N P Gupta have ceased to be directors of the company. Mr. Sanjiwan Sahni, director is due to retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment The Chairman & Managing Director is non retiring director in terms of the Articles of Association.

DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956, the Directors of your Company declare as under

(i) that in the preparation of the annual accounts, the applicable accounting standards had been followed alongwith 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 of the profit or 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 this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;. The same has been certified by the auditors in their annexure to audft report stating therein that no serious discrepancies between the book records and physical quantity have been noticed.

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

AUDITORS

M/s. PDM & Co., Chartered Accountants, New Delhi, shall retire as Statutory Auditors of the Company at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. Auditors observations in their Report have been elaborately dealt with in the Auditors Report / Notes on Accounts in Schedule 5. The same are self explanatory and do not need any more information/ explanation.

Cost Accounting Record Rules and Cost Audit Report Rules are not applicable due to suspension / closure of the plant.

SUBSIDIARY COMPANIES

Statement under Section 212 of the Companies Act, 1956 together with Annual Reports of Companys three Wholly Owned Subsidiaries, namely Spin Investment (India) Limited, Superior Investment (India) Limited and Modi Tyres Company Private Limited, are attached.

STATUTORY DISCLOSURES

During the year under review, there was no employee for the purpose of Section 217(2A) of the Act. Since there was no production, there is no information required to be given for energy conservation, technology absorption, fuel consumption etc. u/s 217 (1) (e) of the Act. Information about foreign exchange earnings and outgo is nil during the year under review.

CORPORATE GOVERNANCE

As per the applicable provisions of Clause 49 of the listing agreement with Stock Exchanges, a Management Discussion & Analysis Report, and a Report of Corporate Governance together with Auditors Certificate form part of the Annual Report.

CONSOLIDATED FINANCIAL STATEMENTS

Requisite Consolidated Financial Statements of the Company and its Subsidiaries are enclosed and form part of this Report.

ACKNOWLEDGEMENT

Your Directors place on record their sincere thanks for support and co-operation from the Honble BIFR/AAIFR, Banks, Government Authorities and Shareholders during the year under review. Your Directors also appreciate services of executives, staff and workers of the Company for unstinted efforts in rehabilitation and revival of the company.

For and on behalf of the Board

Place : New Delhi (Vinay Kumar Modi)

Date : September 18, 2010 Chairman & Managing Director

 
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