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Directors Report of Orissa Minerals Development Company Ltd.

Mar 31, 2014

Dear Members,

On behalf of the Board of Directors of the Company, I take great pleasure in presenting the 96th Annual Report of the Company for the financial year ended 31st March, 2014 together with the Audited Statements of Accounts, the Auditors'' Report and Comments on the Accounts by the Comptroller and Auditor General of India.

1. FINANCIAL RESULTS

The financial results of OMDC for the year 2013-14 in comparison with previous financial year 2012-13 are highlighted here in Table-1 below:

TABLE-1

Particulars For the year ended For the year ended

31-03-2014 31-03-2013 (Rs. in Lacs) (Rs. in Lacs)

Income:

Revenue From Operations - -

Other Income 7536.36 7998.11

Total Income 7536.36 7998.11

Total Expenditure 4924.48 4437.25

Total Expenditure including Prior Period 4960.57 4491.47 Items & Extraordinary Items

Profit and Loss after charging all expenses 2575.79 3506.64 but before providing for depreciation.

Depreciation 901.35 881.60

Net Profit Before Tax 1674.44 2625.04

Provision For Tax (Net) 1048.14 1338.62

Net Profit After Tax 626.30 1286.42

Balance B/F from Previous Year 49167.02 48235.27

Profit available for Appropriations 49793.32 49521.69 Appropriations :

General Reserve 62.63 128.64

Proposed Dividend 62.40 193.20

Dividend Tax 10.60 32.83

Surplus carried to Balance Sheet 49657.69 49167.02

It can be observed from the above table that Company has made a net profit of Rs. 626.30 lacs which was possible only through judicious investment of surplus fund of the Company.

OMDC was operating six mining leases of Iron ore and Manganese ore in the State of Odisha. The operations in six mines were stopped in phases from 2006—2010 due to non renewal of mining leases and consequent non availability of statutory clearances. As a result, the company has not been able to do any production during the entire financial year. This has caused serious set-back to the earnings of OMDC.

2. REVIEW OF THE FINANCIAL PERFORMANCE

During the year under review your Company has recorded no sales. Other incomes in the year 2013-14 are decreased by 5.77 % in comparison to previous year 2012-13 from Rs. 7998.11 lacs to Rs. 7536.36 lacs. Profit before tax during the financial year 2013-14 stood at Rs. 1674.44 lacs as compared to Rs. 2625.04 lacs for the previous financial year 2012-13 registering a decrease by 36.21 %. Profit after tax for the financial year 2013-14 had been Rs. 626.30 lacs as compared to Rs. 1286.42 lacs during the previous financial year 2012-13 registering a decrease by 51.31%.

As there was no production and dispatch of Iron Ore and Manganese Ore during the year 2013-14, there was no operating income during this year.

The main earning of the Company for the year 2013-14 was interest from the term deposits.

3. OUTPUT AND DISPATCH

Closure of all six mines, owing to non availability of statutory clearances coupled with the restrictions imposed on the transporting of minerals have affected production and dispatch of the company adversely and has resulted in nil production and nil dispatch during the year 2013-14.

4. DIVIDEND

Based on the financial results of the company and keeping in view the suspension of mining operations of the company for a long period, your Board is pleased to recommend for the year a dividend of Rs. 1.04 per equity share of Rs. 1/- each despite of low operating income. This would involve a cash outgo of Rs. 73.00 lacs inclusive of tax on dividend.

5. OTHER INCOME

Your Company continued its prudent cash planning during the year and as per the Government Guidelines, deployed the surplus funds in fixed deposits and earned an interest income of Rs. 72.77 crores on fixed deposits during the year 2013-14 which is included in the other income head of the Statement of Profit & Loss Account for the year ended 31st March, 2014.

6. NETWORTH

The net worth of the company has recorded an increase of 0.68 % from the previous financial year 2012-13. For the year 2013-14 the Net-Worth of the Company is Rs. 818.50 crores as compared to Rs. 812.97 crores in the previous financial year ended 31st March, 2013.

7. THE COMPANIES ACT, 2013

The Ministry of Corporate Affairs (MCA) has notified 282 sections of the Companies Act, 2013 in tranches in September, 2013 and March, 2014 with majority of the sections as well as rules being notified in March, 2014. The Companies Act, 1956 continues to be in force to the extent of the corresponding provisions of the Companies Act, 2013 which are yet to be notified. MCA vide its Circular dated April 4, 2014 has clarified that the financial statements and documents annexed thereto, auditor''s report and Board''s report in respect of financial year that have commenced earlier than April 1, 2014 shall be governed by the provisions of the Companies Act, 1956 and in line with the same, the financial Statements, auditor''s report, Board''s report and attachments thereto have been prepared in accordance with the provisions of the Companies Act, 1956. With respect to the other provisions of the Act, appropriate references have been made in this report to the extent these provisions have become applicable effective from April 1, 2014.

8. MEETINGS OF THE BOARD OF DIRECTORS

Annual calendar of meetings of the Board/Committees is usually finalized well before the beginning of the year after seeking concurrence of all Directors. The meetings are scheduled only if most of the directors agree for the same. In case any of the directors have a subsequent change of plan and are not available for the meeting, efforts are made to re-schedule the meeting provided the other Directors are available and willing to re-schedule the same. Where circumstances preclude the chairman from attending the meeting, he entrusts an Independent Director or a Non-Executive Director to chair the meeting. Wherever possible, Directors who are not able to attend the meetings, join the proceedings through video conference or audio conference. Further, in order to facilitate the smooth functioning of the company, the Board, if necessary, also approves resolutions by circulation between two Board meetings.

During the year ended 31 March, 2014, the Board of Directors met six times viz. on 24th May, 2013 (1) at 10:30 A.M, 24th May, 2013 (2) at 2:30 P.M, 5* August, 2013, 11th October, 2013, 13th November, 2013 and 14th February, 2014.

9. DECLARATION OF INDEPENDENCE BY INDEPENDENT DIRECTORS

The Independent Directors of the Company, viz. Mr. Abdul Kalam, Mr. K. J. Singh and Mr. P.S. Bhattacharyya have affirmed that they continue to meet all the requirements specified under Clause 49(I)(A)(iii) of the listing agreement in respect of their position as an "Independent Director" of The Orissa Minerals Development Company Limited.

10. FUTURE OUTLOOK

Presently all the six mines of OMDC are in-operative due to non renewal of mining leases and consequent non availability of statutory clearances. This situation has resulted in loss of opportunity by the Company to enhance and expand the business from its core activity. The operations in six mines were stopped in phases from 2006— 2010. At the peak level when the mines were in operation, the company was producing approximately 22.30 Lakh tonnes of Iron ore and 0.82 Lakh tonnes of Manganese ore per annum and in the year 2006-2007 the turnover of the Company was Rs. 299.93 Crores.

At present the Company is meeting all its expenditures against income from interest on surplus funds kept as fixed deposits with Nationalized Banks. As the interest rate of the Bank fluctuates and the Company has many commitments for making various statutory payments, the opening of mines and resumption of mining operations are considered to be utmost important in order to attain the financial stability of the Company. Because of non-revision of pay of employees, the attrition of qualified and experienced executives in the Organization has increased. There is also need to enhanced the confidence of stakeholders of the Company as mines are in-operative for a long period.

Company''s future plan could not take desired shape mainly because of uncertainties with the renewal of mining leases of the company. Impediments could not, however, put a halt to company''s determination to go ahead with its future value added schemes. The company is committed and geared also to move forward for sustenance and better future.

Nevertheless, the company has been putting efforts at all levels of State Government for renewal of mining leases and it will certainly result on the positive side of the Company. The Company is also trying in getting the required statutory clearances for early operation of mines and addressing the legal issues with utmost care by engaging experienced and senior advocates/legal professionals to settle Legal cases of the Company at the earliest at all courts.

Once the mining operations of the Company will start, your Company has planned for installation of a 2 MTPA Iron ore Beneficiation Plant and a 2 MTPA Pelletisation Plant through Joint Venture. The company has prepared a Corporate Business Plan to achieve the target of 10 MT of Iron ore and 1 MT of Manganese ore per annum by end of 13th - 5 year plan, i.e. March, 2022. Considering future enhancement upto 10 MTPA, a Thermal Power plant of 220-250 MW capacity can also be set up by the company. In such a situation, Company will approach to Ministry of Coal for linkage to this captive power plant by allocation of a thermal grade coal block for OMDC.

BRAHMANI COAL BLOCK

Keeping in view the future requirement of Coal, OMDC has filed application for allocation of 3 (three) Coal blocks for Commercial Mining and one Coal block for specific end use (Power/Steel) under Rule-4 of Auction by Competitive Bidding of Coal Mine Rule, 2012.

Consequently, Brahmani Coal Block in Talcher, Odisha has been allocated to OMDC by Ministry of Coal, Govt. of India .

Name of Coal Block : Brahmini Coal Block.

Area : 13.26 Sq.Km.

Estimated Geological : 58.90 Million Tonnes .

In accordance with Rule-7 of the "Auction by Competitive Bidding of Coal Mines Rules, 2012, Department of Steel & Mines, Govt. of Odisha directed OMDC to enter into an agreement with the Ministry of Coal, Govt. of India . As per the direction, OMDC is in the process of entering into the Agreement with Ministry of Coal, Govt. of India.

The allocation of the Brahmani Coal Block adds another area of future profit centre for your Company besides the iron ore and Manganese ore mines having the best qualities of reserves.

11. MAJOR INITIATIVES

1. Meetings were held between Secretary (Steel), Ministry of Steel, Govt of India and Chief Secretary, Govt of Odisha regarding renewal of the six mining leases including three leases held in the name of BPMEL in favour of OMDC, as well as transfer of 3 leases in the name of BPMEL to OMDC. A Committee of Joint Secretary, Ministry of Steel, Govt of India and Commissioner-cum-Secretary, Department of Steel & Mines is looking into the modalities of transfer of the three (3) leases in the name of BPMEL to OMDC.

2. Application was filed on 03.12.2013 for Temporary Working Permission (TWP) for Bagiaburu mines.

3. Application was filed on 15.03.2014 for Temporary Working Permission (TWP) for Belkundi & Bhadrasahi mines.

4. Environment Clearance for Dalki mines was obtained on 11th September, 2013

5. Stage-1 forest clearance of Bagiaburu mines was obtained on 21.11.2013.

6. Consent to operate for Dalki mines was obtained on 28.12.2013 with production capacity of 0.24 MTPA.

7. Legal issues/Court cases are being pursued with utmost concern in High Court of Kolkata, DRT-Kolkata, High court of Odisha in regard to transfer of 3 (three) mining leases in the name of BPMEL, a company under liquidation, to OMDC.

8. Matter is being pursued with Commissioner-cum-Secretary, Department of Steel & Mines, Govt of Odisha for sale of mines stock of OMDC. For three (3) mining leases of OMDC (i.e. Bagiaburu, Belkundi, Bhadrasahi) joint verification has been done in January 2013 by team of RCCF-Rourkela, DDM-Joda and OMDC officers. Report was sent to CCF-Nodal by RCCF in September, 2013 and also by DDM-Joda to Director of Mines, Bhubaneswar. Approval for the same is pending with the State Govt. of Odisha.

12. EXEMPTION FOR SIGNING OF MOU FOR THE YEAR 2014-15 BY OMDC WITH HOLDING COMPANY (RINL)

Ministry of Steel, Govt. of India vide its letter no. 7(7)/ 2013-RM- II dated 25.03.2014 informed that OMDC has been exempted from signing of MOU for the year 2014-15 with holding company, RINL since mines of OMDC are not in operation.

13. REPORT ON THE ACTIVITIES OF THE JOINT VENTURE COMPANY (EAST INDIA MINERALS LIMITED)

Performance of Joint Venture Company East India Minerals Limited (EIML) was also affected during the year 2013-14 because of the ongoing crisis which resulted in complete stoppage of the mining operation. The revenue earned by EIML during the year 2013-14 through sale of electricity stood at Rs. 159.76 lacs in comparison to previous year''s revenue of Rs. 172.56 lacs. Other income earned by EIML during the year 2013-14 was Rs. 283.57 lacs as compared to Rs. 285.50 lacs in the financial year 2012-13. The company registered a loss of Rs. 165.06 lacs after tax during the year 2013-14 in comparison to loss of Rs. 255.47 lacs in the previous year 2012-13. The reduction in the amount of loss is mainly due to decrease in expenditure in 2013-14 in comparison to 2012-13.

14. STATUS OF RENEWAL OF THE MINING LEASES:

Mines Lease Lease Mining Present Status Area Expired Stopped on on (Hectare)

KOLHA-ROIDA 254.952 14/08/96 16/11/06 Environment Clearance (EC> IRON & was issued on 23/07/12. MANGANESE Lease renewal is pending MINES on account of BPMEL issue.

DALKI 266.77 30/09/94 24/08/06 EC was issued on 11/09/13. MANGANESE Lease renewal is pending MINES on account of BPMEL issue.

THAKURANI 778.762 30/09/04 09/12/09 EC was recommended on IRON & 24/05/12 subject to Stage-1 MANGANESE Forest Clearance and Wild MINES Life Management Plan, which are under process. Presentation of site specific wild life conservation plan has been made on 20/06/2014 at office of PCCF(Wild Life), Bhubaneswar.

Approval of Chief Wild Life Warden (CWLW), Govt. of Odisha is awaited.

BAGIABURU 21.52 30/09/10 30/09/10 Stage-1 Forest Clearance was IRON MINES issued on 21/11/13. Presentation was made to State Expert Appraisal Committee (SEAC) on 14-05-2014. SEAC has advised to obtained fresh EC from MoEF & has accordingly transferred the proposal to MoEF on 03.07.2014.

BHADRASAHI 998.7 30/09/10 30/09/10 EC was recommended on IRON & 21/06/12 subject to Stage-1 MANGANESE Forest Clearance and Wild MINES Life Management Plan, which are under process. Presentation of site specific wild life conservation plan has been made on 20/06/2014 at office of PCCF (Wild Life) Bhubaneswar.

Approval of Chief Wild Life Warden (CWLW), Govt .of Odisha is awaited.

BELKUNDI 1276.79 15/08/06 09/12/09 EC was recommended on IRON & 25/07/12 subject to Stage-1 MANGANESE Forest Clearance and Wild MINES Life Management Plan, which are under process. Presentation of site specific wild life conservation plan has been made on 20/06/2014 at office of PCCF (Wild Life), Bhubaneswar.

Approval of Chief Wild Life Warden (CWLW), Govt .of Odisha is awaited.

15. INFORMATION TECHNOLOGY

OMDC has taken initiative to publish all tenders/ Expression of Interest (EOI) in Companies Corporate Website as well as Central Public Procurement Portal (CPP Portal). Procedure for Sale of Iron Ore and Manganese Ore is designed through e- auction mode only. Biometric based Attendance System and CCTV based surveillance system is installed at Corporate office. Maintenance of Leave records and processing of salaries of the employees is being done through customized payroll system. Tally based Accounting Package is being used to pay vendors bills and different employee entitlements through RTGS and e-payment mode. OMDC is in the process to install the latest technology of satellite imagery to check movement of trucks, machinery & men to prevent any chance of illegal mining once the mines are put in operation including GPS/ GPRS based surveillance system in mines.

16. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Keeping in view the closure of mining operations of the Company, OMDC allocates 3% of its net PAT for the year 2012-2013 as CSR budget for the year 2013-2014 as per the revised guidelines of DPE on CSR. For the year 2013-14 an amount of Rs. 38.58 lacs was earmarked as CSR budget. The CSR activities are carried out by the Company as per the DPE guidelines and as per the schemes run under CSR for the benefit of the nearby villagers of the mines which are as follows:

(A) JAL DHARA (Water Supply)

1 Under CSR the pipeline has been laid to supply drinking water to the villagers of Bhuyan Roida village with total 4 stand posts at Bhuyan Roida village and 7 Bore wells have been sunked at Kara Khendra, Belkundi, Barbil-8, Santabahl, Uliburu, Chhatbar and Bichakundi villages for Supply of potable Drinking water.

2 RCC reservoir (1500 ltrs capacity) has been constructed with 8 stand posts & cleaning of Dug well at Camp Hutting, Kolha Roida.

3 Over tank has been constructed at Dalki village for Supply of Drinking water to distance areas and one Water Tank has been constructed in Sading village.

(B) GRAMYA SHIKHYA ABHIJAN (Village Education)

4 Brick wall has been constructed, plastering, fixing of door etc has been done for kitchen of Anganvari School at Buru hutting of Sading village.

5 U.P school building has been fenced with barbed wire and provision gate has been made at Camp hutting of Kolha Roida.

6 Boundary wall has been constructed at UGUP school of Uliburu village, UP & ME school of Dalki village and UP school of Belkundi village.

(C) GRAMYA VIKASH (Village development)

1 For the bathing purpose of villagers, desilting, cleaning & renovation of 1 Pond at Kundurpani village, 1 Pond at Sading village and 3 Ponds at Bhuyan Roida village has been done.

2 For supply of Drinking water, renovation & development of Natural spring water at Camp Hutting of Kolha Roida village has been done and 4 Toilets have been constructed at Nalda village.

(D) MAHILA SASHASTIKARAN (Women Empowerment)

1 20 nos. of sewing machine were donated to village women and provided ancillary training to them in tailoring for the upliftment of women and make them self dependent.

(E) SWASTHA KARYAKARMA (Health Programme)

1 Steps has been initiated for supply of Free medicine to villagers from Thakurani Hospital and Roida Dispensary with free health check-up.

2 One Medical Health Van has been procured under CSR scheme for extending the medical facilities to the villagers in the peripheral villages near mines area. The van is a Mobile Health unit, equipped with oxygen cylinder, ECG machine etc. has been dedicated to the Health services of peripherals village of OMDC Mines. 12 Health camps were held in six villages and 988 patients/ villagers were examined and provided with free medicines and free heath check-up.

(F) OTHERS

1 Relief and rehabilitation activities has been done by the Company for the cyclone (Phailin) affected areas in Ganjam.

2 News paper & Magazine has been provided to village clubs for enhancement of knowledge and keep them updated on current affairs.

3 Organizing Football tournament under CSR at Thakurani and Roida.

1 Sports gears has been provided to Kolha Roida, Bhuyan Roida, Kundurpani, Chhatabar villages and Barbil-7 village under CSR.

2 Voluntary contribution of fund under CSR scheme for rebuilding the infrastructure in Odisha affected by devastated Cyclone

17. SAFETY MEASURES

OMDC has initiated safety measures according to provision of the Mines Act, 1952 in terms of Rules, Regulations and Guidelines towards safety of employees engaged in mining and allied activities. Necessary safety devises, tools and implements have been provided to the concerned employees. Safe practices pertaining to different activities in mining operations are displayed through participation of workers in safety exhibitions locally as well as on regional basis. Basic and refresher training is imparted to the workers in the Vocational Training Center.

18. TECHNOLOGY UPGRADATION

The focus of the Company is to develop OMDC as a green mining Company, having technological upgradation and taking all safety measures to have safe and cost effective mining operations.

PARTICULARS OF EMPLOYEES UNDER SECTION 217 (2A) OF THE COMPANIES ACT, 1956

There was no employee of the Company who received remuneration in excess of the limits prescribed under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of employees) Rules, 1975, as amended from time to time.

20. IMPLEMENTATION OF THE RIGHT TO INFORMATION ACT, 2005

The Government of India enacted the Right to Information (RTI) Act, 2005 on June 15, 2005. The objective of the Act is to promote transparency and accountability in the administration and to provide good governance in the Country.

Your Company is proactively complying with the provisions of the Right to Information Act, 2005. All the relevant manuals pertaining to RTI Act 2005 have been uploaded on the Company''s website. The queries are regularly replied through a Public Information Officer and assisted by Assistant Public Information Officer of Head Office and Mines Office. All the information sought under the Act has been furnished within the stipulated time period. Whenever there is a delay in reply due to unavailability of proper information within the stipulated time limit, an interim reply is always sent to the applicants. During the year ended on 31st March, 2014, total 11 applications have been received (in respect of BGC), out of which 9 applications were accepted. Out of these 9 applications, 5 applications were disposed of during the year.

Statutory Reports like Monthly Returns, Quarterly Returns and Annual Returns and other reports as required under this Act were complied and forwarded to the Ministry from time to time.

21. PROGRESSIVE USE OF HINDI

OMDC has taken positive steps to enhance awareness and usage of Hindi among employees. The Company follows the directives issued from time to time by the Department of Official Language, Ministry of Home Affairs and Ministry of Steel, Government of India for the progressive use of Official Language, Hindi.

The Company had observed "Hindi Pakhwada" w.e.f 14th September,2013 to 28th September, 2013 by way of organizing competitions such as essay writing, singing Hindi song, Hindi poem recitation and Hindi dictation in which the employees took active participation. Cash Prizes, certificates and mementos were awarded to the winners of various events. "Rajbhasha Shikshan Board" is placed at Head Office to apprise the employees with new Hindi words every day. Two Workshops have been conducted on 16.07.2013 & 28.03.2014 in which 21 and 12 employees were participated respectively.

A Hindi Teaching Scheme ''Probodh'' was conducted in Head Office of the Company from 22.01.2014 and the final examination was conducted on 26.05.2014. 29 employees (including 15 Executives & 14 Non- Executives) were appeared for the said examination and have secured good marks. Overall result is 100 %. Good scorers will be awarded incentives as per rules of the Department of Rajbhasa, Ministry of Home Affairs, Govt. of India. Next Session for a Hindi Teaching Scheme ''PRAVEEN'' has been started from July, 2014.

22. EMPOWERMENT OF WOMEN

The Company continues to accord due importance to gender equality. All necessary measures/ statutory provisions for safeguarding the interests of women employees in issues like payment of wages, hours of work, health, safety, welfare aspects and maternity benefits etc are being followed by the Company.

In compliance with the directives of the Supreme Court, guidelines relating to sexual harassment of women workers at work places were issued by Govt. of India, Ministry of Human Resources and Development. Accordingly, a Grievance Cell for Women is functioning in the Company to redress grievance of women employees. No case of any harassment has been reported at any of the Mines of the Company or its Corporate Office. The directives have been widely circulated to bring awareness amongst the employees, particularly women.

OMDC does not differentiate in terms of gender. To ensure empowerment of women, "Gender Budgeting Cells" have been constituted. Total women employees on roll of the Company as on 31.03.2014 was 135 which constitutes 21.06 % of its total employees of 641.

As a part of its CSR activities, Self Help Groups have been formed at the mines which comprise of women originate from the remote villages. They are trained to tailoring and various other vocational activities in order to make them self-reliant.

23. WELFARE OF WEAKER SECTIONS OF SOCIETY

The Company is fully aware of its social responsibilities for development and welfare of weaker Section of the Society. Presidential Directives on Reservation in appointments for Scheduled Castes and Scheduled Tribes in Public Enterprises are strictly adhered by OMDC. The total number of employees in OMDC as on 31.03.2014 is 641. About 70% of the total strength (450 out of 641) belong to SCs/STs/ OBCs, out of which, 78 belongs to SCs (12.17 %), 244 belongs to STs (38.07 %) and 128 belongs to OBCs (19.97%).

Your Company is also taking keen interest in development of the downtrodden people living in the vicinity of the mines situated in remote areas by providing drinking water facilities, road maintenance, periodical medical checkups and treatment to people living in these villages.

24. MANPOWER

Strength of SCs, STs and OBC''s as on 31st March, 2014

1. Total number of employees = 641

2. Scheduled Castes amongst them = 78 (Executive-7, and Non Executive-71)

3. Scheduled Tribes amongst them = 244(Executive-2, and Non Executive-242)

4. OBC = 128

5. Total SCs STs and OBC = 450

6. Physically Challenged employees = 2

25. INDUSTRIAL RELATIONS

Industrial relations in your Company and at Mines continued to be cordial and peaceful during the year 2013-14. The system of Permanent Negotiation Mechanism (PNM) has been introduced in the Company and its mines for discussing various issues for smooth functioning of the Organization and expeditious decisions for the settlement of grievances. This is to ensure the better understanding between the Management and the Workers and to have cordial industrial relations. No major industrial relation incidents reported during the year 2013-14.

26. VIGILANCE

The Vigilance Department of the Company is headed by CVO, RINL, and assisted by one Vigilance Officer and one PSO to CVO in Head Office, Kolkata. In addition two Vigilance officers (additional charge) are appointed for OMDC mines, Thakurani. The function of Vigilance department includes both preventive and punitive actions for all the Mines of the company and for the Registered Office at Kolkata. Company''s Vigilance department is continuing its efforts for systematic improvement to bring more and more transparency in working environment of the Company. Vigilance department has conducted various training programme and interactive sessions for creating vigilance awareness among employees. The company observes Vigilance Awareness Week at the Head Office as well as at the units of the Company from 28th October, 2013 to 2nd November, 2013 during which various activities like Slogan competition, Essay competition, taking pledge by the employees etc. were carried out to create vigilance awareness among the employees.

System improvement has been achieved in the following areas:

* Codification of all service rules and their implementation.

* Efforts have been made to improve contract management.

* Barricades, Drop gates, Road barriers/Nala and Trenches have been made to prevent theft and pilferages.

* Disbursement of all payments through electronic medium.

* Adoption of Whistle Blower Policy.

* Adoption of Complaint Handling Policy.

* Initiative for the installation of surveillance system in mines.

* To adopt sensitive post criteria in various appointments of the Company.

* MIS system has been modified at Head office.

* Sale of material through e-Action.

* Implementation of ISO 9001:2008 Certification in Vigilance Management of entire set of activities for OMDC, Vigilance Department.

* Speed up proceedings of disciplinary case.

* To have better accountability in movement of materials, a system of custodian of stocks in each mines has been introduced.

* Installation of weigh-bridges at all the vital exit points and such weigh-bridges to be connected with computer in order to ensure automatic recording of minerals received at various plots/ stockyards so that data''s are reconciled on day to day basis. It is being implemented in phased manner.

* Suggestion Boxes at Head Office and Mines offices at Thakurani are placed.

27. GRIEVANCE REDRESSAL MECHANISM (GRM)

Grievance Redressal Mechanism (GRM) is placed in your Company at unit level and at Corporate level to address grievances of the employees. Nodal officers have been notified for this purpose. This measure will create healthy working environment. The name and designation of the Nodal Officers have been posted in the company website.

TABLE-2

SI. Type of Grievances No. of Grievances No Grievances outstanding received during as on 01.04.2013 the period 01.04.13 to 31.03.14

1 Public Nil Nil Grievances

2 Employee Nil 2 Grievances

SI. Type of No. of cases No. of No Grievances disposed of case during the period pending as 01.04.2013 to on 31.03.14 31.03.2014

1 Public Nil Nil Grievances

2 Employee Nil 2 Grievances

The company has incorporated the system for on line receipt of grievances as per the "Sevottam Model". Necessary online link has been provided in company''s website i.e. www.birdgroup.gov.in for online recording of public grievances.

28. IMPLEMENTATION OF THE PERSONS WITH DISABILITIES ACT, 1995

OMDC being a mining organization is governed by the provisions of the Mines Act, 1952 and Rules & Regulations thereof. OMDC has implemented the provisions of "Persons with Disabilities Act, 1995". 2 persons with disabilities are employed in OMDC during the year 2013-14.

29. COMPLIANCE WITH LAW/ LEGAL REQUIREMENTS

In terms of the guidelines issued by the Government, a Quarterly Report on the progress of Arbitration cases is being put up to the Board of Directors for information and guidance. An Internal Reporting System has been introduced indicating the progress of the cases in various Courts and the status of the cases as at the beginning of the year and also at the end of the year. The Company has taken measures to ensure legal compliances from all the departmental heads and the annual legal compliance report are placed before the Board for review.

30. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

I. Energy Conservation

The Company consumes purchased electricity. The following steps are being taken by the Company to reduce the electricity consumption.

ELECTRICAL UTILITIES

Electricity Distribution System

* Schedule our operations to maintain a high load factor

* Shift loads to off-peak times if possible.

* Minimize maximum demand by tripping loads through regular power cuts.

* Stagger start-up times for equipment with large starting currents to minimize load peaking.

* Use standby electric generation equipment for on-peak high load periods.

* Correct power factor to at least 0.90 under rated load conditions.

* Relocate transformers close to main loads.

* Set transformer taps to optimum settings.

* Check utility electric meter with our own meter.

Motors

* Properly size to the load for optimum efficiency.

(High efficiency motors offer of 4- 5% higher efficiency than standard motors)

* Use energy-efficient motors where economical.

* Use automatic power factor controller to improve power factor.

* Check alignment.

* Provide proper ventilation

(For every 10 °C increase in motor operating temperature over recommended peak, the motor life is estimated to be halved)

* Check for under-voltage and over-voltage conditions.

* Balance the three-phase power supply.

(An imbalanced voltage can reduce 3 - 5% in motor input power)

* Demand efficiency restoration after motor rewinding.

(If rewinding is not done properly, the efficiency can be reduced by 5 - 8%) Lighting

* Reduce excessive illumination levels to standard levels.

* Install efficient alternatives to incandescent lighting, mercury vapor lighting, etc. Efficacy (lumens/watt) of various technologies range from best to worst approximately as follows: low pressure sodium, high pressure sodium, metal halide, fluorescent, mercury vapor, incandescent.

* Select ballasts and lamps carefully with high power factor and long-term efficiency in mind.

* Upgrade obsolete fluorescent systems to Compact fluorescents and electronic ballasts

* Change exit signs from incandescent to LED.

DG sets

* Optimize loading

* Clean air filters regularly

* Insulate exhaust pipes to reduce DG set room temperatures

Apart from that OMDC is encouraging use renewable energy by installing 50 Nos. of solar street lights at nearby peripheral villages under CSR scheme.

II. Technology absorption

The Company has not absorbed any new technology during the year .

III. Foreign Exchange Earnings and Outgo:

There was no transaction in foreign exchange during the year.

31. STATUTORY AUDITORS

On the advice of the Comptroller and Auditor General of India, New Delhi, your Company appointed the under mentioned firm of Chartered Accountants as Statutory Auditor of your Company for the year 2013-14:

SI. No. Name of the Address of the Auditor

Auditor

1. M/s LBJha&Co GF-1, Gillander House, 8, Netaji Subhas _ Road,Kolkata-700001

The Statutory Auditors Report on the Accounts of the Company for the Financial Year ended 31st March, 2014 is enclosed to the Directors'' Report.

32. COST AUDITORS

In terms of the Cost Accounting Records Rules, 2011, issued by Ministry of Corporate Affairs on 06.11.2012, vide Order no: F.No. 52/26/CAB-2010 the Company is required to maintain cost accounting records and get them audited every year. Your Company has appointed M/s. Chatterjee & Co, Cost Accountants, as Cost Auditors of the Company for the financial year 2013-14. The cost audit report would be filed with the Central Government within prescribed timelines. The Cost Audit Report and Compliance Report for the year 2012-13 were filed within the time limit as prescribed by the Ministry of Corporate Affairs.

33. COMMENTS BY THE COMPTROLLER AND AUDITOR GENERAL OF INDIA (CAG) ON THE ACCOUNTS OF THE COMPANY FOR THE YEAR ENDED 31st MARCH, 2014

The Comptroller and Auditor General of India (CAG) had conducted Supplementary Audit under Section 619(3)(b) of the Companies Act, 1956 of the financial statements of The Orissa Minerals Development Company Limited for the year ended 31st March, 2014. The comments of Comptroller & Auditor General of India under Section 619(4) of the Companies Act, 1956 on the Accounts of the Company for the year 2013-14 forms part of this report.

34. ADVERSE IMPACT OF PAYMENT OF ENHANCED STAMP DUTY BY THE LESSEES OF MINING LEASES AS PER THE PROVISIONS OF THE INDIAN STAMP (ODISHA AMENDMENT)ACT, 2013 AND ACTION TAKEN BY OMDC.

Two separate Writ petitions under Article 226 & 227 of the Constitution of India, for issue of Writ of Quo Warrant to the Government of Odisha to quash the provisions of Indian Stamp (Odisha Amendment) Act, 2013 and Rule 11- C of the Odisha Stamp Rules, 1952 inserted through Odisha Stamp (Amendment) Rules, 2013 was filed by OMDC in the "High Court of Orissa", Cuttack separately for the mines of OMDC :

(A) Petition no W.P(C) no. 15377/2013 dated 08.07.13 was filed for:

i) Bhadrasahi Iron & Mn Mines,

ii) Belkundi Iron & Mn. Mines

iii) Bagiaburu Iron Mines

(B) Petition no W.P(C) no: 15512/2013 dated 09.07.13 was filed for the BPMEL mines operated by OMDC:

iv) Thakurani Iron & Mn Mines

v) Kolha -Roida Iron & Mn Mines

vi) Dalki Mn. Mines

The High Court of Orissa heard both the above petitions on 17.07.13 and passed an order for interim stay of the impugned Indian Stamp (Odisha Amendment) Act, 2013, Odisha Stamp (Amendment) Rules, 2013 and Circular dated 25.05.2013 and dated 03.07.2013 issued by Principal Secretary, Department of Steel & Mines, Govt. of Odisha.

35. MAJOR LEGAL CASES

* In November, 2009 UCO Bank assigned an outstanding BPMEL loan of Rs. 4.08 Crore to TPG Equity Management Pvt. Ltd, Kolkata (TPG) for a consideration of only Rs. 55 Lakhs.

* After assignment by UCO Bank which was allowed by the DRT, Kolkata, M/s TPG received an amount of Rs. 2.99 cr. in September 2011 from Official Liquidator (OL) and filed a case in High Court of Kolkata claiming an amount of Rs. 183 cr. including interest.

* Against this claim, M/s TPG appealed for revival of BPMEL with the help of BPMEL mining leases namely, Kolha-Roida, Dalki and Thakurani which are operated by OMDC since inception.

* OMDC approached High Court of Kolkata in September, 2013 as an intervener in the case filed by M/s TPG.(Case no: CA400/2013)

* As allowed by High Court Kolkata, OMDC, as an intervener, filed Affidavit in December 2013 appealing to reject the claim of M/s TPG to utilize the three Mining leases held in the name of BPMEL.

* Further OMDC filed five cases in the Debt Recovery Appellate Tribunal (DRAT), Kolkata against the five orders of Debt Recovery Tribunal (DRT) in May, 2014. These orders of DRT are creating hindrance upon effect of OMDC to renew the mining lease by allowing claim of M/s TPG on BPMEL mines. The cases are currently under hearing at DRAT, Kolkata.

* Demand Notice Issued by DDM, Joda

OMDC received Demand note on 15.02.2014 & 21.02.2014 against excess mining by OMDC during the period from 2000-01 till 2009-10 from Dy. Director of Mines(DDM), Joda region, Keonjhar in respect of all the six mining leases of OMDC. The total amount claimed is Rs. 5395.37 Crores against all six leases.

Against the above demand of DDM, Joda, OMDC has filed 6 (six) nos. of revision applications, for each of the mining leases, before the Revisional Authority, Ministry of Mines ,Govt. of India at New Delhi on 13.03.2014, challenging the demand notice(s) issued by DDM, Joda, Keonjhar .

36. REPORT ON MANAGEMENT DISCUSSIONS AND ANALYSIS

A Report on Management Discussions and Analysis as required in terms of Clause 49(F) of the Listing Agreement is enclosed and forms part of the report.

37. CORPORATE GOVERNANCE

A report on Corporate Governance along with the certificate from a Practising Company Secretary regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing agreement with the Stock Exchanges also forms part of this Directors'' Report.

Certificate attested by the CEO/CFO is also enclosed forming part of the Corporate Governance Report along with a declaration signed by MD regarding Code of Conduct for Members of the Board and Senior Management.

38. DIRECTORATE

The following Non- Executive Independent Directors ceased to be Directors on the Board of the Company :

Name of the Directors Ceased to be Directors w.e.f

Shri Harsh Mahajan 06.04.2013

Shri Ashok Vij 06.04.2013

Smt Uma Menon 06.04.2013

The following Managing Director ceased to be Director on the Board of the Company:

Name of the Director Ceased to be Director w.e.f

Dr Satish Chandra 15.07.2013

Shri Umesh Chandra, Director of OMDC took over the additional charge of Managing Director of OMDC w.e.f 15.07.2013 (A/N) to 15.07.2014. Consequent upon attaining the age of superannuation, Shri Umesh Chandra, Ex-officio Non- Executive Director was ceased from the Board of OMDC w.e.f 31.07.2014 (A/N).

The following Govt of India Nominee Director ceased to be Director on the Board of the Company :

Name of the Director Ceased to be Director w.e.f

Shri E.K. Bharat Bhushan 01.05.2013

Shri Lokesh Chandra, Govt Nominee Director nominated in the Board of OMDC w.e.f 1.05.2013 pursuant to the order of Ministry of Steel, Government of India.

Consequent upon attaining the age of superannuation, Shri A.P Choudhary, Ex- officio Non-Executive Chairman was ceased from the Board of OMDC w.e.f 31.12.2013. Shri Ponnapalli Madhusudan was nominated in the Board of OMDC in his place w.e.f 9.01.2014 as Ex-officio Non- Executive Chairman.

Smt Uma Menon was appointed as a Director on the Board of OMDC w.e.f

24.05.2013. She ceased to be Director on the Board of the Company w.e.f

20.10.2013.

The Board places on record its deep appreciation for the valuable contribution made by Shri Harsh Mahajan, Shri Ashok Vij, Smt Uma Menon, Dr Satish Chandra, Shri E.K. Bharat Bhushan, Shri A.P Choudhary and Shri Umesh Chandra during their tenure on the Board of the company.

The following Directors were appointed as the Non Executive Independent Directors of the Company:

Name of the Non Executive Appointed w.e.f Independent Directors

1. Shri Abdul Kalam 18.12.2013

2. Shri K.J. Singh 18.12.2013

3. Shri P.S. Bhattacharyya. 18.12.2013

Shri P.K Sinha was nominated in the Board of OMDC as Director (Production & Planning) for a period of five (5) years w.e.f 04.02.2014 pursuant to the order of Ministry of Steel, Government of India.

Shri D.N Rao was nominated in the Board of OMDC as Ex-officio Non-Executive Director w.e.f 02.08.2014 pursuant to the order of RINL, holding company of OMDC.

39. DEPOSIT

The Company has not accepted any deposit pursuant to Section 58A of the Companies Act, 1956.

40. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors confirm :

(i) that in the preparation of the annual accounts, the applicable accounting standards had 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;

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

41. LISTING

The Company''s shares are listed at The Calcutta Stock Exchange Limited, National Stock Exchange Limited and also traded in Bombay Stock Exchange Limited under permitted category. The listing fee is paid upto 31st March, 2015.

42. DEPOSITORY SYSTEM

The Company''s shares are under compulsory demat mode. The Company has entered into agreement with National Securities Depository Limited (NSDL) and Central Depository Services (I) Limited (CDSL).

There is satisfactory progress in the process of dematerialization. Only 159 no. of Shareholders are still having certificate in physical form. Members having certificate in physical form are requested to dematerialise their holdings for operational convenience.

43. ACKNOWLEDGEMENT

Your Directors take this opportunity to express their grateful appreciation for the continued support and guidance received from the Government of India especially the Ministry of Steel, Ministry of Mines, Ministry of Environment and Forest, Ministry of Corporate Affairs and from Government of West Bengal and Odisha and other Departments of Government of India.

Your Directors place on records their sincere thanks to the support extended by the valued and esteemed Customers, Shareholders, Stakeholder, Railway Department, Banks and the Suppliers. Directors also wish to convey their appreciation to all the employees of the organization for their valuable contributions and support.

For and on behalf of the Board.

(P. Madhusudan)

Chairman

Registered Office : AG-104, "Sourav Abasan", 2nd Floor, Sector-II, Salt Lake City, Kolkata-700091 Date: 14th July,2014.


Mar 31, 2013

On behalf of the Board of Directors of the Company, I take great pleasure in presenting the 95th Annual Report of the Company for the financial year ended 31st March, 2013 together with the Audited Statements of Accounts, the Auditors'' Report and Comments on the Accounts by the Comptroller and Auditor General of India.

1. FINANCIAL RESULTS

The financial results of OMDC for the year 2012-13 in comparison with previous financial year 2011-12 are highlighted here in Table-1 below :

TABLE-1

Particulars For the year For the year ended ended 31-03-2013 31-03-2012 (Rs.in Lacs) (Rs.in Lacs)

Income:

Revenue From Operations 152.54

Other Income 7998.11 5965.58

Total Income 7998.11 6118.12

Total Expenditure 4437.25 5416.71

Total Expenditure including Prior Period 4491.47 5426.27

Items & Extraordinary Items

Profit and Loss after charging all expenses 3506.64 691.85 but before providing for depreciation.

Depreciation 881.60 (136.65)

Net Profit Before Tax 2625.04 828.50

Provision For Tax (Net) 1338.62 (484.16)

Net Profit After Tax 1286.42 344.34

Balance B/F from Previous Year 48235.27 47985.41

Profit available for Appropriations 49521.69 48329.75

Appropriations:

General Reserve 128.64 34.43

Proposed Dividend 193.20 51.66

Dividend Tax 32.83 8.38

Surplus carried to Balance Sheet 49167.02 48235.27

It can be observed from the above table that Company has made a profit of Rs.12.86 crores which was possible only through judicious investment of company reserve/ surplus fund in nationalized banks as per DPE guidelines.

OMDC was operating six mining leases of Iron ore and Manganese ore in the State of Odisha. Presently, the company is not carrying out any mining activity since the mining leases have expired and the company is vigorously pursuing the matter of renewal of mining leases with the State Government and Central Government authorities so as to enable it to resume its mining operations at an early date. Considerable progress was made in obtaining several statutory approvals and permissions for re-commencement of the mining operations.

2. REVIEW OF THE FINANCIAL PERFORMANCE

During the year under review your Company has recorded nil sales against Rs.152.54 lacs revenue generated from sale of sponge iron in the previous financial year 2011-12. However, other incomes in 2012-13 were increased by 34.07% in comparison to previous year 2011-12 from Rs.5965.58 lacs to Rs.7998.11 lacs. Profit before tax during the financial year 2012-13 stood at Rs.2625.04 lacs as compared to Rs.828.50 lacs for the previous financial year 2011-12 registering an increase by 216.84%. Profit after tax for the financial year 2012-13 had been Rs.1286.42 lacs as compared to Rs.344.34 lacs during the previous financial year 2011-12 registering an increase by 273.59%. The improvement in financial performance was basically through judicious investment of company reserve/ surplus funds in nationalized banks as per DPE guidelines.

There was no production and despatch of Iron Ore and Manganese Ore during the year 2012-13. Consequently, there was no operating income, except earning on interest from fixed deposits.

3. DIVIDEND

Based on the financial results, your Board is pleased to recommend for the year a dividend of Rs.3.22 per equity share of Rs.1/- each despite of negligible operating income. This would involve a cash outgo of Rs.226.03 lacs inclusive of Rs.32.83 lacs towards tax on dividend.

4. OUTPUT AND DESPATCH

There was no mining activity in any of the mines of OMDC during the year 2012-13. Closure of all six mines, owing to non availability of forest and environmental clearance have resulted in nil production and despatches of the company during the year.

5. OTHER INCOME

Your Company continued its prudent cash planning during the year and as per the Government Guidelines, deployed the surplus funds in fixed deposits and earned an interest income of Rs.73.70 crores on fixed deposits against Rs.56.34 crores during the last year 2011-12 which is included in other income.

6. NETWORTH

It is observed that the net worth of the company is Rs.812.97 crores for the financial year 2012-13 as compared to Rs.802.36 crores in the previous financial year 2011-12 recording an increase of 1.32%.

7. SUB-DIVISION

During the year under review, the face value of the equity shares of the Company has been sub-divided from Rs.10/- (Rupees Ten) each fully paid up into Rs.1/- (Rupee One) each fully paid up pursuant to the approval of the shareholders of the Company at the 94th AGM of the company held on Wednesday, the 19th day of September, 2012.

Fully paid up equity shares of F.V. XV- each against every 1 fully paid up equity shares of F.V. Rs.10/- were allotted to shareholders on 31st October, 2012 under new ISIN INE725E01024 of the company The existing equity shares of face value of Rs.10/- each bearing distinctive nos.000001 to 600000 stand cancelled w.e.f 31st October, 2012.

8. AWARDS

Your Company was accorded recognition for its meritorious services to its stakeholders as follows:

- OMDC was Awarded Hindi Rajbhasha Award - 2012 by "Parivartan Jan Kalyan Samiti, Delhi".

- OMDC was conferred the National Mines Safety Award, 2008 by the Hon''ble President of India.

9. FUTURE OUTLOOK

The Management of your Company has made a Corporate Business Plan 2012- 2022 which envisages increase in Iron Ore production from 2 million tonnes to 10 million tonnes and Manganese Ore from 0.4 million tonnes to 1 million tonnes, besides installation of 2 MTPA Iron Ore Beneficiation Plant and 2 MTPA Pelletisation Plant at Thakurani, District-Keonjhar, Odisha.

In order to expand the activities of the Company in all possible areas, keeping in view the value addition, draft MOU was under examination for finalization with regard to proposed Joint Venture between OMDC/ RINL/ KIOCL for setting up a Beneficiation and Pelletisation Plant as per Detailed Project Report (DPR) prepared by M.N. Dastur and Company.

So far, OMDC has been carrying out mining operation by outsourcing. The company has planned to go for semi-mechanised mining operation departmentally. Expert third party consultants were appointed to firm up the mining plan, policy for the company for departmental mining as against contractual mining in the past. In this process MECON was also appointed to prepare Detailed Project Report of all six mines in order to introduce the latest state of art mining operations/ efficiencies at par with the best in the industry. Draft Long Term Sale Policy of the company was under examination for finalization.

Presently, OMDC is having two Railway sidings in Thakurani, which will be up-graded by putting up in motion weighbridge and automated loading facilities so as to improve evacuation efficiency of the company and also the company has deployed CISF and now planning to go for GPS base surveillance system to prevent theft and pilferage for ensuring better safety and security of the mining area.

Since OMDC is in the process of setting up of 2 MTPA Pelletisation Plant the power requirement will be approx. 30 MW. Considering future enhancement upto 8 MTPA the Power requirement will be to the tune of 120 MW. During peak operation of all the six leases, the requirement will be approx. 15 MW. Thus the total requirement will be around 135 MW & the Captive power plant can sell 50% of the total generation. Total Generation Permitted 270MW with Plant Load Factor (PLF) of 90% , Power plant of 300 MW can be set up.

For next thirty (30) years, requirement of Coal will be nearly 210 Million Tonne. Washed Coal with recovery of 65-70% can be used. The Block with 312 MT reserve is suitable for OMDC''s Captive Power Plant. Keeping in view the future requirement, OMDC has filed application for 3 (three) block for Commercial Mining and one block for specific end use (Power/Steel) under Rule-4 of Auction by competitive bidding of Coal Mine Rule, 2012.

10. EXEMPTION FOR SIGNING OF MOU FOR THE YEAR 2013-14 BY OMDC WITH HOLDING COMPANY (RINL)

Ministry of Steel, Govt, of India vide its letter no. 7(7)/ 2012-RM II dated 29.11.2012 informed that OMDC has been exempted of signing of MOU for the year 2013-14 with holding company, RINL since mines of OMDC are not in operation.

11. REPORT ON THE ACTIVITIES OF THE JOINT VENTURE COMPANY (EAST INDIA MINERALS LIMITED)

Performance of Joint Venture Company East India Minerals Limited (EIMLJ was also affected during the year because of the ongoing crisis resulted from complete stoppage of the mining operation. The revenue earned by EIML during the year 2012-13 through sale of wind electricity stood at Rs.172.56 lacs which was marginally higher than Rs.148. 69 lacs in the previous year 2011-12. However, the company registered a loss of Rs.255.47 lacs during the year 2012-13 in comparison to loss of Rs.258.79 lacs in the previous year 2011-12.

13. INFORMATION TECHNOLOGY

OMDC takes Information Technology as the vital enabler in improving the customer-satisfaction, organizational efficiency, productivity, decision- making, transparency and cost-effectiveness. The highlights of IT initiatives and achievements in respect of OMDC during the year 2012-13 are enumerated below:

- Publishes all tenders/ EOls in Company''s Corporate

Website and Central Public Procurement Portal (CPP Portal). "«** service under csr scheme - OMDC is in the process to install the latest technology of satellite imagery to check movement of trucks, machinery & men to prevent any chance of illegal mining once the mines are put in operation including GPS/ GPRS based surveillance system in mines.

14. CORPORATE SOCIAL RESPONSIBILITY (CSR)

OMDC focuses on CSR activities like health, education, and supply of drinking water and community development. For the year 2012-13 an amount of Rs.17.25 lacs have been earmarked as CSR budget. OMDC allocates 5% of its net PAT as CSR budget. The CSR activities are carried out as per the DPE guidelines and as per the schemes run under CSR for the benefit of the villagers are as follows:

SWALAMBI SANGATHAN (Self Help Group- SHG)

> OMDC is taking keen interest in development of people of villages especially for the women by assisting them to form Self Help Group for carrying out various income generating activities like growing of mushrooms, vegetables, nursery, poultry and manufacturing of candles.

> The Community works for the Dalki & Sading village for the upliftment of the people located in the village near by mines area. under CSR SchomB

> Financial Assistance has been provided to one Self Help Group at Camp hutting of Kolha Roida village for developing co-operative business in their locality.

JAL DHARA (Water Supply)

> Necessary arrangements in regard to laying of pipeline from existing borewells to Munda/Gouda Sahi of Dalki Village were made by OMDC.

> Water supply has been provided through water tanker. Under CSR the pipeline has been laid from Dug well to Sading village to supply drinking water to the villagers of Sading, with total 11 stand posts at Sading village has been provided.

SWASTHA KARYAKARMA (Health Programme)

> Construction of 10 nos. twin pit dry toilet has been completed in the nearby mines area in order to meet their sanitary needs.

> Initiative has been taken for Malaria eradication programme in peripheral villages in the mines area.

> Steps has been initiated for supply of medicine to nearby poor villagers suffering from serious diseases like cancer, cardiac, kidney, lever cirrhosis etc. living in peripheral villages.

> Display of 12 nos. of board for family planning in the villages nearby mining lease area has been completed.

> Provision of silt removal, road repairing etc. in the nearby villages has been completed.

> One Medical Health Van has been procured under CSR scheme for extending the medical facilities to the villagers in the peripheral villages near mines area. The van is a Mobile Health unit, equipped with oxygen cylinder, ECG machine etc. has been dedicated to the Health services of peripherals village of OMDC Mines. 5(five) nos. of camp were held up to 31st March, 2013 and 681 nos of patients were examined and provided with free medicines in the camp.

> 25 nos. solar street lights provided to peripheral villages located near the mines area.

MAHILASASHASTIKARAN (Women Empowerment)

> 20 nos. sewing machine donated to village women and provided ancillary training to them in tailoring for the upliftment of women and make them self dependent.

> 78 nos of bicycles donated to school going girl students for their personal mobility as part of women empowerment program.

GRAMYA SHIKHYA ABHIJAN (Village Education)

> Financial Assistance was given to High School located near the mines area to provide thrust to education.

> Providing necessary assistance for technical training at Centurion University, BBSR with 10 persons in batches for ST/ SC/OBC (weaker sections of society) students to make them employable.

> News paper & Magazi ne has been provided to vi I lage clubs for enhancement of knowledge and keep them updated on current affairs.

OTHERS

> Construction of Foot walk Bridge (connection) from Dalki to Kara Kolha village for school going children from the nearby mines area.

> Organizing Football tournament under CSR through local club duly sponsored by OMDC.

> Supply of sports gears to youth sports person villagers under CSR

15. SUSTAINABLE DEVELOPMENT PROGRAMME

In terms of MOU with Rashtriaya Ispat Nigam Limited (RINL) for the year 2012-13 under Sustainable Development Programme, the following three projects have been considered to be carried out by OMDC during the year 2012-13.

- Project-1 The job of building up of water reservoir at Thakurani is under progress.

- Project-2 Afforestation under Bio Diversity Conservation at Thakurani leasehold area- A nursery has been set up in Thakurani Mines during the financial year 2012-2013. Under this project 20000 saplings have been planted in the nursery.

- Project-3 The brick making project will commence on resumption of the mining operation.

16. VOLUNTARY RETIREMENT SCHEME

In order to rationalize manpower of the Company, the Management has introduced the "Voluntary Retirement Scheme" with effect from 1.02.2010. It was effective till 31.03.2013. However so far no employee has obtained VRS from OMDC. For motivating the employees, the Voluntary Retirement Scheme of OMDC was reviewed within the purview of DPE guidelines to make it more attractive.

17. SAFETY MEASURES

Safety is an important aspect in functioning of any industry. It is important not only for its employees and workers but also for the environment and the nation. OMDC has initiated safety measures according to provision of the Mines Act, 1952 in terms of Rules, Regulations and Guidelines towards safety of employees engaged in mining and allied activities. Necessary safety devises, tools and implements have been provided to the concerned employees. Safe practices pertaining to different activities in mining operations are displayed through participation of workers in safety exhibitions locally as well as on regional basis. New practices are also regularly adopted by visiting similar mines. Refresher training is imparted to the 105 employees from different disciplines of OMDC in the Vocational Training Center in the mines of OMDC. The employees have received prizes and awards from the Annual Mines Safety Week Celebration, 2012 conducted by DGMS(Directorate General of Mines Safety) Chibas Region.

18. TECHNOLOGY UPGRADATION

The focus of the Company is to develop OMDC as a green mining Company, having technological upgradation and taking all safety measures to have safe and cost effective mining operations, and to improve its production, productivity and quality of product to increase its market realization while aspiring to be a clean, green mining company.

19. PARTICULARS OF EMPLOYEES UNDER SECTION 217 (2A) OF THE COMPANIES ACT, 1956

There was no employee of the Company who received remuneration in excess of the limits prescribed under Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of employees) Rules, 1975, as amended from time to time.

20. IMPLEMENTATION OF THE RIGHT TO INFORMATION ACT, 2005

The Government of India enacted the Right to Information (RTI) Act, 2005 on June 15, 2005. The objective of the Act is to promote transparency and accountability in the administration and to provide good governance in the Country.

Your Company is proactively complying with the provisions of the Right to Information Act, 2005. OMDC has nominated a Public Information Officer(PIO) and assisted by Assistant Public Information Officer(APIO) in the head office for effectively processing the RTI applications received at various locations of the company.

RTI applications have been processed as per the provisions of the RTI Act. Quarterly reports have been submitted on-line.

21. PROGRESSIVE USE OF HINDI

OMDC has taken positive steps to enhance awareness and usage of Hindi among employees. The Company follows the directives issued from time to time by the Department of Official Language, Ministry of Home Affairs and Ministry of Steel, Government of India for the progressive use of Official Language Hindi.

The Company had observed "Hindi Pakhwada" w.e.f 15th September,2012 to 28th September, 2012 byway of organizing competitions such as essay writing, singing hindi song, hindi poem recitation and hindi dictation in which the employees took active participation. Cash Prizes, certificates and mementos were awarded to the winners of various events. Bilingual Boards and advertisements are being issued. "Rajbhasha Shikshan Board" is placed at Head Office to apprise the employees with new words every day.

22. EMPOWERMENT OF WOMEN

The Company continues to accord due importance to gender equality. All necessary measures/ statutory provisions for safeguarding the interests of women employees in matters like payment of wages, hours of work, health, safety and welfare aspects, maternity benefits etc are being followed by the Company.

A Women Grievance Cell is functioning in the Company to redress grievance of women employees. OMDC does not differentiate in terms of gender. To ensure empowerment of women, "Gender Budgeting Cells" with women representatives have been constituted. Total women employees on rolls of the Company as on 31.03.2013 was 154 which constitutes 21.56% of its total employees.

23. WELFARE OF WEAKER SECTIONS OF SOCIETY

The Company is fully aware of its social responsibilities for development and welfare of weaker section of the society. Presidential Directives on Reservation for Scheduled Castes and Scheduled Tribes in appointments in Public Enterprises are strictly adhered to by OMDC. The total number of employees in OMDC as on 31.03.2013 is 714 . About 70% of the total strength (499 out of 714) belong to SCs/STs/ OBCs, out of which,90 belonged to SCs( 26 %) ,271 to STs ( 37.95 %) and 138 to OBCs (19.32 %). During the period from 1.4.2012 to 31.03.2013, total 8 nos. of SC/ ST/ OBC were appointed by direct recruitment.

78 girls students belonging to SCs/ STs/OBCs families of peripheral Villages of OMDC were given bicycles under the CSR scheme/initiatives.

24. MANPOWER

Scheduled Castes & Scheduled Tribes

5 persons belonging to Scheduled Castes and 1 person belonging to Scheduled Tribe were appointed in the year 2013 against 18 posts filled in by direct recruitment.

Strength of SCs, STs and OBC''s as on 31st March, 2013

1. Total number of employees = 714

2. Scheduled Castes amongst them = 90 (Executive-9, and Non Executive-81)

3. Scheduled Tribes amongst them = 271(Executive-4, and Non Executive-267)

4. OBC = 138

5. Total SCs STs and OBC = 499

6. Physically Challenged employees = 2

25. INDUSTRIAL RELATIONS

Industrial relations in your Company and at Mines continued to be cordial and peaceful during the year 2012-13. The system of Permanent Negotiation Mechanism (PNM) system has been introduced in the Company and its mines for discussing various issues for smooth functioning of the Organisation and expeditious decisions for the settlement of grievances. This is to ensure better understanding between the management and workers and to have cordial industrial relations. No IR incidents reported during the year.

26. VIGILANCE

The Vigilance Department of the Company is headed by CVO. Vigilance Awareness Week was observed at the Head Office as well as at the units of the Company from 30th October, 2012 to 3rd November,2012 during which various activities like Slogan competition, Essay competition, taking pledge by the employees etc. were carried out to create vigilance awareness among the employees.

OMDC Vigilance is laying emphasis on preventive and proactive activities to facilitate an environment enabling people to work with integrity, efficiency and in a transparent manner, upholding highest ethical standards for the organization. Accordingly, following activities were undertaken for system improvement during the period April,2012- March,2013:

- Floating company tenders in CPP portal.

- Adoption of Integrity pact.

- Adoption of Whistle Blower Policy.

- Implementation of ISO 9001:2008 Certification in Vigilance Management of entire set of activities for BGC, Vigilance Department.

- Initiation of installation GPS surveillance system in all mines.

Besides this, a Seminar was organized by M/s HSCL, Vigilance Department where company Executives were nominated to participate in Vigilance Awareness and Project Management.

27. GRIEVANCE REDRESSAL MECHANISM (GRM)

Grievance Redressal Mechanism (GRM) is in place in your Company at unit level and at Corporate level to address grievances of the employees. Nodal officers have been notified for this purpose. This measure will create healthy working environment. The name and designation of the Nodal Officers have been posted in the company website.

Status of Public/ Employees'' Grievances from 01.04.12 to 31.03.13

SI. Type of Grievances No. of Grievances No. of cases No. of

No Grievances outstanding received during disposed of cases

as on 01.04.2012 the period 01.04.12 during the period pending

to 31.03.13 01.04.2012 to as on ______________________________________________________31.03.13_______31.03.2013

1 Public Nil Nil Nil Nil Grievances

2 Employee Nil 1 1 Nil Grievances

28. IMPLEMENTATION OF THE PERSONS WITH DISABILITIES ACT, 1995

OMDC being a mining organization is governed by the provisions of the Mines Act and Rules & Regulations thereof. OMDC has implemented the provisions of "Persons with Disabilities Act,1995". 2 persons with disabilities are employed in OMDC during the year 2012-13.

29. ADOPTION OF "SEVEN STEP MODEL FOR CITIZEN CENTRIC-SEVOTTAM" AS PER RECOMMENDATION OF THE 2ND ADMINISTRATIVE REFORMS COMMISSION.

The Ministry of Steel has brought out its "Citizen Charter" and this is periodically updated in tune with the changing requirements and expectations from the stakeholders. OMDC has initiated necessary steps to implement the "Sevottam Guidelines- September, 2011" as issued by the Departments of Administrative Reforms and Public Grievances especially the "Seven Step Model of Sevottam"

30. COMPLIANCE WITH LAW/ LEGAL REQUIREMENTS

In terms of the guidelines issued by the Government, a Quarterly Report on the progress of Arbitration cases is being put up to the Board of Directors for information. An Internal Reporting System has been introduced indicating the progress of the case in various Courts and the status of the cases as at the beginning of the year and also at the end of the year. The Company has taken measures to ensure legal compliances from all the departmental heads and the annual legal compliance report are placed before the Board for review.

31. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

I. Energy Conservation

The Company consumes purchased electricity. Adequate steps are being taken by the Company to reduce the electricity consumption. 25KW transformer has been installed to eliminate operation of 62.5 KVA diesel operated DG set and 25 nos. of solar Light fitted for street lighting as a measure of conservation of energy.

II. Technology absorption

The Company has not absorbed any new technology during the year for its operational activities.

III. Foreign Exchange Earnings and Outgo:

There was no transaction in foreign exchange during the year.

32. ENVIRONMENT MANAGEMENT

An integrated approach is being adopted in OMDC to achieve the goal of sustainable and eco- friendly mining. The company''s strategy towards eco-friendly mining encompasses the following:

i) Scientific Mine Planning.

ii) Pollution control measures- The company has fitted all crusher plants with Dust Extractors, in addition to this, dust is controlled by sprinkling of water at all transfer points of the belt conveyors.Dust suppression by sprinkling of water on roads by mobile water tanker is done to control fugitive dust.

iii) Optimization of resource utilization.

iv) Regular monitoring of Air & Water, Quality and Noise Vibration Level.

v) Reclamation of degraded land.

vi) Rehabilitation of reclaimed areas.

vii) Rural and community development.

Strategy for Afforestation

OMDC has undertaken the job of plantation in mining zone falling under its control. A special cell has been created for ensuring plantation on continuous basis. This has resulted in creation of thick forest area and fruit bearing orchards. Plantation is done in a systematic manner to meet fuel energy requirement of the locals, besides restoration of ecology. Certain areas have been covered by shrubs and grass for greening effect and checking erosion. The Company''s approach towards afforestation incorporates the following :

i) General afforestation in and around mines with appropriate species and scientific techniques suitable areas. ii) Specific afforestation on mine spoil dump. iii) Rejuvenation of mine spoil dumps. 1600 nos. of saplings have been planted in Thakaurani Mines area.

Integrated Bio-Technological Approach

Scientific studies will be initiated for evaluating physic Biotechnical character in OMDC spoil dumps alongwith technological intervention to achieve appropriate ecosystem restoration.

33. AUDITORS

On the advice of the Comptroller and Auditor General of India, New Delhi, your Company appointed the under mentioned firm of Chartered Accountants as Statutory Auditor of your Company for the year 2012-13 :

SI. No. Name of the Auditor Address of the Auditor

1. M/s L B Jha & Co GF-1, Gillander House, 8, Netaji Subhas Road,Kolkata-700001

The Statutory Auditors Report on the Accounts of the Company for the Financial Year ended 31st March, 2013 is enclosed to the Directors'' Report.

34. COST AUDITORS

During the year, the Company has come under the ambit of Cost Audit. The details of Cost Auditors appointed to conduct Cost Audit of the cost records maintained by the company for 2012-13 are as under:

SI. No. Name of the Auditor Address of the Auditor

1. M/s Chatterjee & Co 21/2, Gariahat Road (West), Kolkata-700068

35. COMMENTS BY THE COMPTROLLER AND AUDITOR GENERAL OF INDIA(CAG) ON THE ACCOUNTS OF THE COMPANY FOR THE YEAR ENDED 31 ST MARCH, 2013

The Comptroller and Auditor General of India (C&AG) had conducted Supplementary Audit under Section 619(3)(b) of the Companies Act, 1956 of the financial statements of The Orissa Minerals Development Company Limited for the year ended 31st March, 2013. The comments of Comptroller & Auditor General of India under Section 619(4) of the Companies Act, 1956 on the Accounts of the Company for the year 2012-13 forms part of this report.

36. BIFR CASE NO.520/1992 IN THE MATTER OF BHARAT PROCESS & MECHANICAL ENGINEERS LIMITED (BPMEL) (IN LIQUIDATION)

The Official Liquidator, High Court, Calcutta entrusted with the affairs of Bharat Process & Mechanical Engineers Limited (BPMEL) under liquidation had approached Calcutta High Court for handing over the mining leases of BPMEL regarding Kolha- Roida, Dalki and Thakurani to the Official Liquidator from OMDC and also to make payment of outstanding dues, if any, which was receivable by BPMEL (In Liquidation) in the matter. The matter was taken up and Counsel was appointed by the Company to take up the case at Hon''ble High Court, Calcutta. The Hon''ble Court vide order dated 11/01/2013 has withdraw its order and accordingly the case has been disposed of.

37. ADVERSE IMPACT OF PAYMENT OF ENHANCED STAMP DUTY BY THE LESSEES OF MINING LEASES AS PER THE PROVISIONS OF THE INDIAN STAMP (ODISHA AMENDMENT) ACT, 2013 AND ACTION TAKEN BY OMDC.

The stamp duty chargeable on the instruments of grant or renewal of mining lease has been revised on coming into force of the Indian Stamp (Odisha Amendment) Act, 2013 with effect from May 10,2013 i.e the date of its publication in the Extraordinary Odisha Gazette,

As per the provisions of subsection (1) of section 3A inserted to the Indian Stamp Act, 1899 by the amendment Act, the stamp duty payable on every instrument of grant or renewal of mining lease shall be equivalent to 15% of the amount of average royalty that would accrue out of the highest annual extraction of minerals permitted under the approved mining plan or mining scheme, as the case may be, for such mining lease under the provisions of the Mines and Minerals ( Development & Regulation ) Act, 1957 and the rules made there under in force, multiplied by the period of such mining lease. As provided in the extraction of sub- section (1) of section 3A so inserted, for the purpose of this sub-section, the average royalty of the highest grade of minerals based on the data available for past twelve months, prior to the date on which stamp duty becomes payable, beginning from the date of commencement of the Amendment Act, shall be taken into consideration.

Two separate Writ petitions under Article 226 & 227 of the Constitution of India, for issue of Writ of Quo Warrant to the Government of Odisha to quash the provisions of Indian Stamp (Odisha Amendment) Act, 2013 and Rule 11- C of the Odisha Stamp Rules, 1952 inserted through Odisha Stamp (Amendment) Rules, 2013 was filed by OMDC in the "High Court of Orissa", Cuttack separately for the mines of OMDC :

(A) Petition no W.P(C) no. 15377/2013 dated 08.07.13 was filed for:

i) Bhadrasahi Iron & Mn Mines, ii) Belkundi Iron & Mn. Mines iii) Bagiaburu Iron Mines

(B) Petition no W.P(C) no: 15512/2013 dated 09.07.13 was filed for the BPMEL mines operated by OMDC:

iv) Thakurani Iron & Mn Mines v) Kolha -Roida Iron & Mn Mines vi) Dalki Mn. Mines

The High Court of Orissa heard both the above petitions on 17.07.13 and passed an order for interim stay of the impugned Indian Stamp (Odisha Amendment) Act, 2013, Odisha Stamp (Amendment) Rules, 2013 and Circular dated 25.05.2013 and dated 03.07.2013 issued by Principal Secretary, Department of Steel & Mines, Govt, of Odisha.

The Federation of Indian Mineral Industries (FIMI) has been spearheading the case of the mining industries and is monitoring the cases to file a "Caveat" in the Supreme Court of India. OMDC is contemplating to join with FIMI to file "Caveat" in Supreme Court so that Govt, of Odisha need to attend the case at High Court only. So far OMDC has not received any demand note from any Govt Authorities in this regard.

38. REPORT ON MANAGEMENT DISCUSSIONS AND ANALYSIS

A Report on Management Discussions and Analysis as required in terms of Clause 49(F) of the Listing Agreement is enclosed and forms part of the report.

39. CORPORATE GOVERNANCE

A report on Corporate Governance along with the certificate from a Practising Company Secretary regarding compliance of the conditions of Corporate Governance pursuant to Clause 49 of the Listing agreement with the Stock Exchanges also forms part of this Directors'' Report.

Certificate attested by the CEO/CFO is also enclosed forming part of the Corporate Governance Report along with a declaration signed by MD regarding Code of Conduct for Members of the Board and Senior Management.

40. DIRECTORATE

The following Non- Executive Independent Directors ceased to be Directors on the Board of the Company:

Name of the Directors Ceased to be Directors w.e.f

Shri Harsh Mahajan 06.04.2013

ShriAshokVij 06.04.2013

SmtUmaMenon 06.04.2013

The Board places on record its deep appreciation for the valuable contribution made by Shri Harsh Mahajan, Shri Ashok Vij, Smt Uma Menon during their tenure on the Board of the company.

The following Wholetime Director ceased to be Director on the Board of the Company :

Name of the Director Ceased to be Director w.e.f

Dr Satish Chandra 15.07.2013

The Board places on record its deep appreciation for the valuable contribution made by Dr Satish Chandra during his tenure on the Board of the company.

Shri Umesh Chandra, Director (Operations),RINL and Director of OMDC took over the charge of Managing Director of OMDC w.e.f 15.07.2013.(A/N)

The following Govt of India Nominee Director ceased to be Director on the Board of the Company:

Name of the Director Ceased to be Director w.e.f

Shri E.K. Bharat Bhushan 01.05.2013

The Board places on record its deep appreciation for the valuable contribution made by Shri E.K. Bharat Bhushan during his tenure on the Board of the company.

Shri Lokesh Chandra, Govt Nominee Director nominated in the Board of OMDC w.e.f 1.05.2013 pursuant to the order of Ministry of Steel, Government of India.

Based on recommendation of EIL, holding company of OMDC, and approval of the Board, Smt Uma Menon was appointed as a Director on the Board of OMDC and nominated as member of the Audit Committee w.e.f 24.05.2013.

41. DEPOSIT

The Company has not accepted any deposit pursuant to Section 58A of the Companies Act, 1956.

42. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors confirm :

(i) that in the preparation of the annual accounts, the applicable accounting standards had 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;

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

43. LISTING

The Company''s shares are listed at The Calcutta Stock Exchange Limited, National Stock Exchange and also traded in Bombay Stock Exchange under permitted category. The listing fee is paid upto 31st March, 2014.

44. DEPOSITORY SYSTEM

The Company''s shares are under compulsory demat mode. The Company has entered into agreement with National Securities Depository Limited (NSDL) and Central Depository Services (I) Limited (CDSL).There is satisfactory progress in the process of dematerialisation. Members still having certificates in physical form are requested to dematerialise their holdings for operational convenience.

45. ACKNOWLEDGEMENT

Your Directors take this opportunity to express their grateful appreciation for the continued support and guidance received from the Government of India especially the Ministry of Steel, Ministry of Mines, Ministry of Environment and Forest, Ministry of Corporate Affairs and from Government of West Bengal and Odisha and other Departments of Government of India.

Your Directors place on records their thanks to the support extended by the valued and esteemed Customers, Shareholders, Stakeholder, Railway Department, Banks and the Suppliers. We believe that our long term success is dependent on our strong customer relationship and responsiveness. Directors also wish to convey their appreciation to all the employees of the organization for their valuable contributions and support.

For and on behalf of the Board.

Registered Office:

"Sourav Abasan", 2nd Floor,

AG-104, Sector-ll, Salt Lake

City, Kolkata-700091 (A.P. Choudhary)

Date : 5th August, 2013. Chairman


Mar 31, 2002

The Directors have the pleasure to submit their 84th Annual Report and the Accounts of the company for the financial year ended 31st March, 2002.

1. GENERAL WORKING OF THE COMPANY

The year under review witnessed some improvement in the working results. The sales turnover stepped up from Rs. 2282 lacs to Rs. 2542 lacs during the year, thereby registering an increase of 11.40% over the previous year. The rise in sales turnover was achieved despite low off-take of Blast Furnace (B F) Grade Manganese Ore. In fact despatch of BF grade manganese ore touched a very low figure during the year. The demand for medium grade manganese ore and sized iron ore was however encouraging. Moreover, despatch of iron ore fines which had been stagnant during earlier years shot up during the year under reference, thus giving a boost to deemed export of the item through various agencies and also reducing the level of environmental pollution in the nearby areas.

During the year the company achieved positive gross margin of Rs. 374.29 lacs before charging interest on Government loan and depreciation as compared to Rs. 324.88 lacs for the previous year. The net loss after charging interest on Government loan and depreciation stood at Rs. 504.71 lacs during the year as against loss of Rs. 454.98 lacs for the previous year before adjustment of extra-ordinary items. The net loss has gone up due to the impact of compounding effect of interest on Government loan.

2. ACCOUNTS For the year ended For the year ended

31-03-2002 31-03-2001 (Rs. in lacs) (Rs. in lacs)

Profit and Loss Account after charging all expenses but before providing for depreciation and interest on Govt. loan shows a positive margin (without considering extra-ordinary income for the year) 374.29 324.88

from which depreciation is deducted 117.22 115.17

resulting in positive margin before Interest on Govt. loan 257.07 209.71

from which interest on Govt. loan is deducted 761.78 664.69

Resulting in a profit/(loss) for the year (504.71) (454.98)

Add: Extra-ordinary income

i) Adjustment for intt. on Govt. loan (Rs. in lacs) - 725.66

ii) Adjustment for amortisation towards excess provision - 93.42 819.08

364.10

Add : Transferred from General Reserve 40.55

404.65

Add : Loss brought forward from earlier year (1587.17) (1991.82)

Net Loss carried to balance sheet (2091.88) (1587.17)

While arriving at the figure of cumulative loss of Rs. 2092 lacs as at 31 st March, 2002, the interest on Government loans amounting to Rs. 4006 lacs has been accounted for.

11. AUDIT

With regard to the observations made by the Auditors in their report we state as under:

i) Para 3 of the report - The accounts of the company have been prepared on going concern basis in consideration that the company had positive gross margin before charging interest on Govt. loan and depreciation as referred to in Note 20 of the Notes on Accounts in this regard. The liquid assets of the company also are adequate to meet the current liabilities excluding outstanding interest on Government loan. The order book position of the company is quite satisfactory and the demand of the products are expected not only to remain stabilized but escalate during years to come. The company has submitted Re-structuring Proposal to the Ministry and the same is under active consideration. If the Re-structuring Proposal be sanctioned the company would be in a position to wipe off the accumulated loss and achieve profitability.

ii) Para 4.1 - Regarding non provision of interest for delay in depositing Sales Tax and Royalty, it is stated that this would be dealt with on demand from respective authorities.

iii) Para 4.2 - The company as well the Exempted Trust Fund administered independently by the Trustees have made arrangements with Life Insurance Corporation of India (LIC) for participation in the LICs Group Gratuity Scheme. The arrangement has not yet taken final shape and as such the consequential impact can not be ascertained immediately. Further provision or write back would be considered on emerging of the final position after valuation by LIC of the securities in possession of the Fund. As such the treatment is considered without any material departure from any accounting standard.

iv) Para 4.3 - Note 19 of the Notes on Accounts in this respect is self explanatory. However, auditors comments have been noted and all out efforts will be made to have confirmation of the balances.

12. DIVIDEND

In view of the accumulated loss, your Directors do not recommend payment of any dividend for the year ended 31st March, 2002.

13. PARTICULARS OF THE EMPLOYEES

Provision of section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended is not attracted in respect of remuneration of any employee of the company.

14. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE OUTGO

The company consumes purchased electricity, petrol and diesel oil. Adequate steps are taken by the company to control the consumption. The company has absorbed the technology used for its operational activities.

There was no transaction in foreign exchange during the year.

15. COMPLIANCE CERTIFICATE

In terms of the amendment in the Companies (Appointment and Qualification of Secretary) Rules, 1988 and pursuant to sub-section 1 of section 383A of the Companies Act, 1956, the Compliance Certificate by the Company Secretary in whole time practice is attached with this report.

16. AUDITORS

M/s. Bhadra & Bhadra, Chartered Accountants of 8/2, Kiron Sankar Roy Road, Kolkata 700 001 retire at the conclusion of the forthcoming Annual General Meeting and, being eligible, offer themselves for re- appointment.

17. DIRECTORATE

Shri A. K. Mukherjee, Chairman cum Managing Director who was initially appointed for one year, was given further extension for one year i.e. from 1st January, 2002 to 31st December, 2002.

Dr. (Mrs) Renu Singh Parmar, Director, Ministry of Steel ceased to be a Director from 10th August, 2001.

Smt. Meenakshi Arora, Director, Ministry of Steel who was appointed as an Additional Director effective from 10th August, 2001 ceased to be a Director from 12th February, 2002.

Shri Sudhir Rajpal, Dy. Secretary, Ministry of Steel was appointed as an Additional Director on the Board of Directors of the company from 12th February, 2002. Shri Rajpal holds the office till the conclusion of the

ensuing Annual General Meeting (AGM). A Notice under section 257 of the Companies Act, 1956 has been received from a member of the company proposing the appointment of Shri Rajpal as Director of the company at the ensuing Annual General Meeting.

Shri S. S. Sharma retires by rotation and being eligible, offers himself for re-election.

18. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to sub section 2AA inserted by the Companies (Amendment) Act, 2000 in section 217 your Directors confirm that -

a) in the preparation of the Annual Accounts, the applicable accounting standards have been followed.

b) the Directors have 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 at the end of the financial year and

- profit or loss of the company for that period.

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the company and to prevent and detect fraud and irregularities.

d) the Directors have prepared the annual accounts on a going concern basis.

22. ACKNOWLEDGEMENT

Your Directors take this opportunity to express their grateful appreciation for the continued support and guidance received from the Government of India and more particularly from the Ministry of Steel and also from the Ministry of Environment and Forest, Govt. of India. The Directors place on record their thanks to the Government of Orissa, the Railways, the Bankers, the Customers, suppliers and the Shareholders for their continued co-operation. The Directors also wish to convey their appreciation to all the employees of the organisation for their valuable contributions and support.

On behalf of the Board

A. K. MUKHERJEE Chairman cum Managing Director

Registered Office:

FD-350, Sector-III Salt Lake City Kolkata - 700091

Dated : 29th July, 2002

 
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