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Directors Report of Oxford Industries Ltd.

Mar 31, 2014

Dear members,

The Directors are presenting their 33rd Annual Report together with Audited Accounts for the year ended on 31 st March, 2014.

1. FINANCIAL RESULTS:

2013-14 2012-13 (Rupees in Lacs) (Rupees in Lacs)

(i) Profit/(Loss) before Interest, Depreciation and Taxation (12.29) (6.71)

(ii) Less: Interest Charges 18.19 13.55

(iii) Profit/(Loss) before Depreciation and Tax (30.48) (20.26)

(iv) Depreciation 0.23 0.23

(v) Net Profit/(Loss) before Tax (30.71) (20.49)

(vi) Provision for Taxation : Current Tax - - Deferred Tax-Net (0.07) (0.07)

(vii) Net Profit/(Loss) after Tax (30.64) (20.42)

(viii) Prior Years Adjustments - -

(ix) Net Profit/(Loss) (30.64) (20.42)

(x) Balance Profit/(Loss) brought forward (3,427.03) (3,406.61)

(xi) Balance Profit/(Loss) carried forward (3,457.67) (3,427.03)

2. DIVIDEND:

Your directors regret their inability to recommend any dividend for the year.

3. OPERATIONS:

As already reported, Indian Bank (Lead Bank) had auctioned both the facilities of the company i.e. weaving unit and process house at Ankleshwar, under The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act) in February 2012. During the year under review, there was no income from operations/sales and the net loss was Rs. 30.64 lacs. Interest payable to banks/ institutions has not been provided for the year under review due to the reason that a case in Debt Recovery Tribunal (DRT), Mumbai had been filed by Indian Bank for recovery of dues of all consortium members which is going on.

4. INDUSTRIAL RELATIONS:

The company always believes in cordial relationship with the employees and considers them as most valuable asset for any organization.

5. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed to this report.

6. PARTICULARS OF EMPLOYEES:

As required under the provisions of Section 217(2A) of the Companies Act, 1956, no employee of the Company is in receipt of the remuneration exceeding the limits specified in the said section.

7. FIXED DEPOSITS:

During the year the Company has not invited / accepted any deposits from the public attracting the provisions of Section 58-A of the Companies Act, 1956.

8. DIRECTORS:

Shri Abdemanaf A. Hararwala , Director of the Company retires by rotation at ensuing Annual General Meeting and being eligible, offers himself for appointment as Independent Director of the company in terms of Section 149 and other applicable provisions of the Companies Act, 2013.

The details as required under Clause 49 of the Listing Agreement with the Stock Exchanges with regard to Directorship and membership of Committee, etc., are given in the section of Corporate Governance elsewhere in this Annual Report.

9. DIRECTORS'' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of section 217 (2AA) of the Companies Act, 1956, with respect to Directors'' Responsibility statement, it is hereby confirmed that:

(i) in preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures from the same, except for not providing of interest on secured loan balances availed from consortium of bankers,for the year under review as a case is going on in Debt Recovery Tribunal(DRT),Mumbai filed by Indian Bank.

(ii) the directors have 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 as at March 31, 2014 and of the loss of the Company for the year ended on that date;

(iii) the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the directors have prepared the annual accounts of the Company on a Going Concern basis.

10. STATUTORY AUDITORS:

M/s. RANK & Associates, Chartered Accountants, Mumbai, Statutory Auditors of the Company, retires at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Company has received a certificate from the auditors that their appointment, if made, would be within the prescribed limits under Section 224 (1-B) of the Companies Act 1956. The board recommends their re-appointment.

11. AUDITOR''S OBSERVATIONS:

Clarifications / explanations on the observations made by the Auditor''s in the Audit Report are as follows:

Indian Bank (Lead Bank) had filed a case in Debt Recovery Tribunal (DRT), Mumbai on behalf of consortium bankers for recovery of dues, hence interest for bankers/institution has not been provided for the year. Indian Bank had auctioned both the manufacturing facilities of the company under SARFAESI Act in February 2012.

Huge losses and deficit in current assets have been due to very low utilization of production facilities during the past which in turn was on account of paucity of working capital. The annual accounts of the Company have been prepared on a Going Concern basis.

Since the notes to the accounts as referred in the Auditors'' Report are self explanatory for all other observations of the Auditors, no further clarifications are required from the Management.

12. COST AUDIT:

During the year the company was not having any manufacturing facilities as both the facilities of the company i.e. weaving unit and process house at Ankleshwar, were auctioned by Indian Bank (lead Bank) under SARFAESI Act in February,2012 and hence provisions for Cost Audit are not applicable to the Company for the year under review.

13. CORPORATE GOVERNANCE:

The Company has generally complied with the corporate Governance code as stipulated under clause 49 of the listing agreement with Bombay Stock Exchange. A separate report on corporate governance, along with a certificate from the auditors confirming the compliance, except as otherwise mentioned, is annexed and forms part of the Director''s report.

14. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE:

The Board of Directors in their meeting held on May 30, 2014, have constituted a Corporate Social Responsibility (CSR) committee in line with the provisions of Companies Act, 2013 comprising of Shri Abdemanaf A. Hararwala as chairman and Shri Mazher. N. Laila and Shri Huned Hararwala as members.

15. ACKNOWLEDGEMENTS:

Your Directors express their gratitude to all stakeholders.

For and on behalf of the Board of Directors of

OXFORD INDUSTRIES LTD.

Place : Mumbai MAZHER N. LAILA Date: 12th August, 2014 Chairman & Managing Director


Mar 31, 2012

To, The Members of Oxford Industries Ltd.

The Directors are presenting their 31 st Annual Report together with Audited Accounts for the year ended on 31 st March, 2012.

1. FINANCIAL RESULTS:

2011-12 2010-11 (Rupees in Lacs) (Rupees in Lacs)

(i) Profit /(Loss) before Interest, Depreciation and Taxation (84.15) 0.11

(ii) Less: Interest and Finance Charges 0.14 _

(iii) Profit/(Loss) before Depreciation and Tax (84.29) 0.11

(iv) Depreciation 99.19 116.57

(v) Net Profit/(Loss) before Tax (183.48) (116.46)

(vi) Provision for Taxation :

Current Tax - -

Deferred Tax-Net (223.28) (18.39)

(vii) Net Profit/(Loss) after Tax 39.80 (98.07)

(viii) Prior Years Adjustments _ _

(ix) Net Profit / (Loss) 39.80 (98.07)

(x) Balance Profit/(Loss) brought forward (3,446.41) (3,348.34)

(xi) Amount available for appropriation (3,406.61) (3,446.41)

Appropriations have been made as under:

(a) Transfer to/from General Reserve - -

(b) Balance carried forward to Balance Sheet (3,406.61) (3,446.41)

2. DIVIDEND:

Due to losses, your directors regret their inability to recommend any dividend for the year under review.

3. OPERATIONS AND FINANCIAL PERFORMANCE:

During the year under review, Indian Bank (Lead Bank) auctioned both the facilities of the company i.e. weaving unit and process house at Ankleshwar, held under its physical possession upto 29th February 2012, under The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). Indian Bank approved the sale of both units on 7th February 2012 and handed over physical possession to successful bidders on 1 st March 2012.

During the year under review, net profit was Rs. 39.80 lacs mainly due to reversal of deferred tax liability provisions. No Interest has been charged to revenue for the year under review amounting to Rs. 569.98 lacs due to the reason as narrated in previous para.

4. INTERNATIONAL SCENARIO AN D EXPORTS:

Due to recessionary trend world over, the scope for export of textile from India has been gradually decreasing.

5. INDUSTRIAL RELATIONS:

The company believes in cordial relationship with the employees.

6. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed to this report.

7. PARTICULARS OF EMPLOYEES:

As required under the provisions of Section 217(2A) of the Companies Act, 1956, no employee of the Company is in receipt of the remuneration exceeding the limits specified in the said section.

8. FIXED DEPOSITS:

During the year the Company has not accepted any deposits from the public in the nature of loans attracting the provisions of Section 58-A of the Companies Act, 1956.

9. DIRECTORATE:

Shri Abdemanaf A. Hararwala, Director of the Company retire by rotation at ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

The details as required under Clause 49 of the Listing Agreement with the Stock Exchanges with regard to Directorship and membership of Committee, etc., are given in the section of Corporate Governance elsewhere in this Annual Report.

10. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of section 217 (2AA) of the Companies Act, 1956, with respect to Directors' Responsibility statement, it is hereby confirmed that:

(i) in preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures from the same, except for not providing of interest on secured loans for the year under review as both the facilities of the Company were under physical possession of Indian Bank (Lead Bank) under SARFAESI Act and later auctioned on 7th February 2012;

(ii) the Directors have 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 as at March 31,2012 and of the profit of the Company for the year ended on that date;

(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company (except for assets in possession of Indian Bank, Lead Bank) and for preventing and detecting fraud and other irregularities; and

(iv) the Directors have prepared the annual accounts of the Company on a Going Concern basis.

11. STATUTORY AUDITORS:

M/s. C.N. Lapsiwala & Co., Chartered Accountants, Mumbai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Company has received a certificate from the auditors that their appointment, if made, would be within the prescribed limits under Section 224 (l-B)ofthe Companies Act 1956. The board recommends their re-appointment.

12. AUDITOR'S OBSERVATIONS:

Clarifications / explanations on the observations made by the Auditor's in the Audit Report are as follows:

Indian Bank (Lead Bank) had taken over physical possession of the secured assets under SARFAESI Act and auctioned the same on 7th February 2012. The company was not in possession of the said secured assets throughout the year hence interest has not been provided for the year.

Huge losses and deficit in current assets has been due to very low utilization of production facilities during the past few years which in turn was on account of paucity of working capital. The annual accounts of the Company have been prepared on a Going Concern basis.

Since the notes to the accounts as referred in the Auditors' Report are self explanatory for all other observations of the Auditors, no further clarifications are required from the Management.

13. COST AUDIT:

During the year, both the facilities of the company i.e. weaving unit and process house at Ankleshwar, were held by Indian Bank under its physical possession under SARFAESI Act and later auctioned on 7th February 2012 to its successful bidders. No operations were conducted by the Company during the year and hence provisions for Cost Audit are not applicable to the Company for the year under review.

14. CORPORATE GOVERNANCE:

The Company has generally complied with the corporate Governance code as stipulated under clause 49 of the listing agreement with Bombay Stock Exchange. A separate report on corporate governance, along with a certificate from the auditors confirming the compliance, except as otherwise mentioned, is annexed and forms part of the Director's report.

15. ACKNOWLEDGEMENTS:

Your Directors express their gratitude to all stakeholders for their support to the Company.

For and on behalf of the Board of Directors

Place: Mumbai MAZHER N. LAILA

Date: 31st July, 2012 Chairman & Managing Director


Mar 31, 2011

The Members,

Oxford Industries Ltd.

The Directors are presenting their 30th Annual Report together with Audited Accounts for the year ended on 31st March, 2011.

1. FINANCIAL RESULTS:

2010-11 2009-10 (Rupees in Lacs) (Rupees in Lacs)

(i) Profit / (Loss) before Interest, Depreciation and Taxation 0.11 (13.48)

(ii) Less: Interest and Finance Charges — 428.18

(iii) Profit/(Loss) before Depreciation and Tax 0.11 (441.66)

(iv) Depreciation 116.57 148.73

(v) Net Profit/(Loss) before Tax (116.46) (590.39)

(vi) Provision for Taxation :

Current Tax — —

Deferred Tax - Net (18.39) (26.55)

(vii) Net Profit/(Loss) after Tax (98.07) (563.84)

(viii) Prior Years Adjustments — 0.52

(ix) Net Profit / (Loss) (98.07) (564.36)

(x) Balance Profit /(Loss) brought forward (3,348.34) (2,783.98)

(xi) Amount available for appropriation (3,446.41) (3,348.34)

Appropriations have been made as under:

(a) Transfer to / from General Reserve — —

(b) Balance carried forward to Balance Sheet (3,446.41) (3,348.34)

2. DIVIDEND:

Due to losses, your directors regret their inability to recommend any dividend for the year under review.

3. OPERATIONS:

During the year under review, both the facilities of the company i.e. weaving unit and process house at Ankleshwar, continues to be under physical possession of Indian Bank (Lead Bank) under The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). The management has been trying to get a partner/investor to settle the liabilities of the lenders and revive the operations.

4. INTERNATIONAL SCENARIO AND EXPORTS:

Due to recessionary trend world over, the scope for export of textile from India has been gradually decreasing.

5. INDUSTRIAL RELATIONS:

The relationship with the employees during the year was cordial and the directors express their gratitude for the continued co-operation of the employees.

6. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed to this report.

7. INSURANCE:

Since the assets of the company are under physical possession of Indian Bank (Lead Bank) under SARFAESI Act, Insurance related matters are being looked after by them.

8. PARTICULARS OF EMPLOYEES:

As required under the provisions of Section 217(2A) of the Companies Act, 1956, no employee of the Company is in receipt of the remuneration exceeding the limits specified in the said section.

9. FIXED DEPOSITS:

During the year, the Company has not accepted any deposits from the public in the nature of loans attracting the provisions of Section 58-A of the Companies Act, 1956.

10. DIRECTORATE:

Shri Huned M. Hararwala, Director of the Company retire by rotation at ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Shri Abdemanaf A. Hararwala was appointed as Additional Director by the Board on 7th March 2011 under section 260 of the Companies Act, 1956 and who holds office up to the date of ensuing Annual General Meeting, but being eligible, offers himself for re-appointment.

The details as required under Clause 49 of the Listing Agreement with the Stock Exchanges with regard to Directorship and membership of Committee, etc., are given in the section of Corporate Governance elsewhere in this Annual Report.

11. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to the provisions of section 217 (2AA) of the Companies Act, 1956, with respect to Directors' Responsibility statement, it is hereby confirmed that:

(i) in preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures from the same; except for not providing of interest on secured loans for the year under review as both the facilities of the company were under physical possession of Indian Bank (Lead Bank) under SARFAESI Act throughout the year.

(ii) the Directors have 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 as at March 31, 2011 and of the loss of the Company for the year ended on that date;

(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 and for safeguarding the assets of the Company (except for assets in possession of Indian Bank, Lead Bank) and for preventing and detecting fraud and other irregularities; and

(iv) the Directors have prepared the annual accounts of the Company on a Going Concern basis.

12. STATUTORY AUDITORS:

M/s. C.N. Lapsiwala & Co., Chartered Accountants, Mumbai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Company has received a certificate from the auditors that their appointment, if made, would be within the prescribed limits under Section 224 (1-B) of the Companies Act 1956. The board recommends their re-appointment.

13. AUDITOR'S OBSERVATIONS:

Clarifications / explanations on the observations made by the Auditor's in the Audit Report are as follows:

As Indian Bank (Lead Bank) had taken the physical possession of the secured assets viz. both the Weaving Unit and Process House under SARFAESI Act and the company was not in possession of the said secured assets throughout the year, interest has not been provided on the outstanding secured loans for the year.

Huge losses and deficit in current assets has been due to very low utilization of production facilities during the past few years which in turn was on account of paucity of working capital. The Management has been trying to get a partner / investor to settle the liabilities of the Lenders and revive the operations. The annual accounts of the Company have been prepared on a Going Concern basis.

Since the notes to the accounts as referred in the Auditors' Report are self explanatory for all other observations of the Auditors, no further clarifications are required from the Management.

14. COST AUDITORS:

Pursuant to a directive of the Central Government, the Company is required to conduct a cost audit in respect of its Textile manufacturing activities. Accordingly M/s. Kirit Mehta and Company, Cost Accountants, Mumbai have been appointed as cost auditors to carry out audit of the cost accounts maintained by the Company for the year ended 31st March, 2011.

15. CORPORATE GOVERNANCE :

The Company has generally complied with the corporate Governance code as stipulated under clause 49 of the listing agreement with Bombay Stock Exchange. A separate report on corporate governance, along with a certificate from the auditors confirming the compliance, except as otherwise mentioned, is annexed and forms part of the Director's report.

16. ACKNOWLEDGEMENTS:

Your Directors express their gratitude to all stakeholders for their support to the Company.

For and on behalf of the Board of Directors

MAZHER N. LAILA Chairman & Managing Director

Place: Mumbai Date : 30th July, 2011


Mar 31, 2010

The Directors are presenting their 29th Annual Report together with Audited Accounts for the year ended on 31st March, 2010.

1. FINANCIAL RESULTS: (Rupees in Lacs)

2009-10 2008-09

(i) Profit/(Loss) before Interest, Depreciation and Taxation (13.48) (384.27)

(ii) Interest and Finance Charges 428.18 390.62

(iii) Profit/(Loss) before Depreciation and Tax (441.66) (774.89)

(iv) Depreciation 148.73 139.47

(v) Net Profit/(Loss) before Tax (590.39) (914.36)

(vi) Provision for Taxation :

Current Tax — —

Fringe Benefit Tax — 3.00

Deferred Tax - Net (26.55) (11.95)

(vii) Net Profit/(Loss) after Tax (563.84) (905.41)

(viii) Prior Years Adjustments 0.52 22.16

(ix) Net Profit / (Loss) (564.36) (927.57)

(x) Balance Profit/(Loss) brought forward (2,783.98) (1,856.41)

(xi) Amount available for appropriation (3,348.34) (2783.98)

Appropriations have been made as under:

(a) Transfer to / from General Reserve — —

(b) Balance carried forward to Balance Sheet (3,348.34) (2783.98)

2. DIVIDEND:

Due to losses, your directors regret their inability to recommend any dividend for the year under review.

3. OPERATIONS:

During the year under review, sales turnover was Rs.163.42 lacs only compared to Rs. 1935.68 lacs in the previous year. Net loss for the year was Rs.564.36 lacs compared to Rs.927.57 lacs in the previous year.

The key developments during the year under review were:

1) The weaving unit was non-operational during the year and the Process House of the company was operational only up to 13th August 2009 as Indian Bank (Lead Bank) took over symbolic possession of both the units (Weaving Unit and Process House) of the company under The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARF AESI) Act, 2002 as on that date.

2) There was very low utilization of Process House even up to 13th August 2009 mainly due to paucity of working capital.

4. Legal Action by Lenders under SARF AESI Act, 2002

Indian Bank (Lead Bank) had issued notice dated 16th October 2008 under section 13(2)of The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002(SARFAESI Act, 2002) demanding repayment of the entire loan portfolio, failing which the bank shall exercise its enforcement rights under section 13(4) of the said act against the secured assets of the company. Given the then financial condition of the Company it was not possible for the management to repay the entire loan. As the company was unable to fulfill the conditions given in the said notice the Bank took over symbolic possession of secured assets of the company situated at the Weaving Unit and the Process House on 13th August 2009 and the physical possession on 18th January 2010. The Bank has further placed both the units of the company (Weaving Unit and Process House) under auction for sale.

5. PROCEEDINGS AT BOARD FOR INDUSTRIAL & FINANCIAL RESTRUCTURING (BIFR)

A reference was made to BIFR under section 15 of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) on 28/2/2008. The case was registered at No. 20/2008. During the year the BIFR held four hearings on 13/5/2009, 8/7/2009, 26/8/2009 and 17/2/2010. In the last hearing held on 17/2/2010, the BIFR abated the reference of the company pending before it under the third proviso to section 15(1) of SICA as the Indian Bank (Lead Bank) had already taken over possession of companys assets u/s 13(4) of SARF AESI Act, 2002.

6. INTERNATIONAL SCENARIO AND EXPORTS:

The scope for Indian textile for exports has increased post abolition of quotas. Your Company did not get any export order during the year.

7. INDUSTRIAL RELATIONS:

The relationship with the employees during the year was cordial and the directors express their gratitude for the continued co-operation of the employees.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO:

Information pursuant to Section 217 (1) (e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed to this report.

9. INSURANCE:

All the properties including factory building, plant & machinery and stocks have been adequately insured.

10. PARTICULARS OF EMPLOYEES:

As required under the provisions of Section 217(2A) of the Companies Act, 1956, no employee of the Company is in receipt of the remuneration exceeding the limits specified in the said section.

11. FIXED DEPOSITS:

During the year the Company has not accepted any deposits from the public in the nature of loans attracting the provisions of Section 58-A of the Companies Act, 1956.

12. DIRECTORATE:

Shri Akbar A. Shahpurwala, Director of the Company retire by rotation at ensuing Annual General Meeting and being eligible, offers himself for re-appointment.

Shri Mahendra D. Kamdar, Shri Salim T. Shahpurwala and Shri Shabbir N. Laila, Directors of the Company, had resigned with effect from 31st January 2010, 26th May 2010 and 29th May 2010 respectively. The Board places on record its appreciation for the services rendered by these directors during their tenure as directors of the Company.

The details as required under Clause 49 of the Listing Agreement with the Stock Exchanges with regard to Directorship and membership of Committee, etc., are given in the section of Corporate Governance elsewhere in this Annual Report.

13. DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to the provisions of section 217 (2AA) of the Companies Act, 1956, with respect to Directors Responsibility statement, it is hereby confirmed that:-

(i) in preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures from the same;

(ii) the Directors have 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 as at March 31, 2010 and of the loss of the Company for the year ended on that date;

(iii) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) the Directors have prepared the annual accounts of the Company on a Going Concern basis.

14. STATUTORY AUDITORS:

M/s. C.N. Lapsiwala & Co., Chartered Accountants, Mumbai, Statutory Auditors of the Company, will retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Company has received a certificate from the auditors that their appointment, if made, would be within the prescribed limits under Section 224 (1-B) of the Companies Act 1956. The board recommends their re-appointment.

15. AUDITORS OBSERVATIONS:

Clarifications / explanations on the observations made by the Auditors in the Audit Report are as follows:

Huge losses and deficit in current assets has been due to very low utilization of production facilities during the past few years which in turn was on account of paucity of working capital. Further, during the current year possession of both, the Weaving Unit and Process House was taken by Indian Bank (Lead Bank). The Management has been trying to get a partner/investor including an Asset Reconstruction Company to settle the liabilities of the lenders and revive the operations. The annual accounts of the Company have been prepared on a Going Concern basis.

Since the notes to the accounts as referred in the Auditors Report are self explanatory for all other observations of the Auditors, no further clarifications are required from the Management.

16. COST AUDITORS:

Pursuant to a directive of the Central Government, the Company is required to conduct a cost audit in respect of its Textile manufacturing activities. Accordingly M/s. Kirit Mehta and Company, Cost Accountants, Mumbai have been appointed as cost auditors to carry out audit of the cost accounts maintained by the Company for the year ended 31st March, 2010.

17. CORPORATE GOVERNANCE:

The Company has generally complied with the corporate Governance code as stipulated under clause 49 of the listing agreement with the Stock Exchange. A separate report on corporate governance, along with a certificate from the auditors confirming the compliance, except as otherwise mentioned, is annexed and forms part of the Directors report. -

18. ACKNOWLEDGEMENTS:

Your Directors place on record their appreciation for the dedicated efforts put in by all the employees of the Company and express their gratitude to all shareholders for their confidence and continued support to the Company.

For and On behalf of the Board of Directors



Place :Mumbai MAZHER N. LAILA

Date: 31st July, 2010 Chairman & Managing Director