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Directors Report of PBM Polytex Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting the Ninety Sixth Annual Report of the Company with the Audited Statements of Accounts for the year ended 31st March 2015.

1. FINANCIAL RESULTS: (Rs. in lacs) 2014-15 2013-14

Earning Before Interest, Depreciation and Tax (EBIDITA) 2390.32 3899.70

Less: Interest and Financial Charges 324.23 365.26

Gross Profit 2066.09 3534.44

Less: Depreciation 388.80 562.22

Profit before Tax 1677.29 2972.22

Less: Provision for Taxation 616.26 1016.44

1061.03 1955.78

Add / (Less): Deferred Tax Liability / (Asset) 1.82 (13.85)

Profit for the year (PAT) 1059.21 1969.63

Add: Surplus brought forward 3019.33 1487.47

Less: Transitional effect of depreciation of assets as on 01.04.2014 62.95 2956.38 0.00

Amount available for Appropriation 4015.59 3457.10

Appropriation:

General Reserve 1400.00 200.00

Proposed Dividend 487.74 203.23

Corporate Dividend Tax 99.29 34.54

1987.03 437.77

Balance carried to Balance Sheet 2028.56 3019.33

2. DIVIDEND

Your Directors are pleased to recommend a Dividend @ 60 % (i. e. Rs. 6/- per share) on the paid up equity share capital of the Company for the year ended 31s1 March 2015, which will absorb Rs. 587.03 lac including dividend distribution tax of Rs. 99.29 lac.

3. TRANSFER TO RESERVES

Your directors propose to transfer Rs. 14 Crore to General Reserve out of the profits of the Company.

4. CHANGE IN THE NATURE OF BUSINESS

There was no change in the nature of business of the Company during the Financial Year 2014-15.

5. STATE OF COMPANY'S AFFAIRS ,

The prices of cotton, the main raw material, had gone up steeply during the greater part of the year. However, on the contrary, the prices of cotton yarn came down on account of fall in exports which put pressure on domestic prices also. The Company exports about 40 % of its production and the rupee getting stronger in terms of US Dollar also resulted in lower realisation of export yarn.

The power cost also went up during the year mainly because of denial of permission by the Gujarat State Electricity Board for buying power from open market. All these factors, which were beyond the control of the management, were responsible for lower profitability during the year.

The working results of the Company during the first quarter of the current year are satisfactory.

6. DIRECTORS / KEY MANAGERIAL PERSONNEL

The Board of Directors has appointed Smt. Vinitadevi Modi and Shri M L Bagaria as additional directors of the Company in the category of Independent Directors with effect from 20.09.2014 and 09.02.2015 respectively. Proposals have been received from the shareholders for appointment of these directors as such at the ensuing Annual General Meeting for a period of consecutive five years.

All Independent Directors have given declarations that they meet the criteria of Independence as laid down under section 149 (6) of the Companies Act, 2013 ("the Act") and Clause 49 of the Listing Agreement.

The Board of Directors has, on the recommendation of the Nomination and Remuneration Committee, redesignated Shri Mohan Kumar Patodia as Managing Director cum Chief Financial Officer and Shri Amit Patodia as Senior President cum Chief Executive Officer.

Shri Hari Prasad Siotia, retire by rotation at the 96th Annual General Meeting of the Company and being eligible, offers himself for re- appointment. The directors recommend their re-appointment as proposed in the notice of the Meeting.

None of the Directors is disqualified under Section 164(2) of the Companies Act, 2013.

7. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance as well as the directors individually including Independent Directors, the Audit Committee, Nomination and Remuneration Committee, CSR Committee and Stakeholders Relationship Committee. The result of the evaluation is satisfactory, adequate and meets the requirement of the Company.

8. NUMBER OF BOARD MEETINGS

The details of Board Meetings are disclosed in Corporate Governance Report appended to Directors' Report. The Board of Directors have met five times and Independent Directors have met once during the year ended 31st March 2015.

9. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the Provisions of Section 134(3)(c) of the Act, your Directors confirm that -

1. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

2. the accounting policies adopted are consistently applied 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 of the company for the year;

3. proper and sufficient care is being taken 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;

4. annual accounts have been prepared on a going concern basis;

5. internal financial controls (as required by explanation to section 134(5)(e) of the Act) is being followed by the Company and that such internal financial controls are adequate and were operating effectively;

6. proper systems are being devised to ensure compliance with the provisions of applicable laws and that such systems are adequate and operating effectively.

10. SHARE CAPITAL

The paid up Equity Share Capital as on 31st March 2015 was Rs. 8,12,96,080/-. During the year under review, the Company has not issued any shares.

11. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS UNDER SECTION 186 OF THE ACT

The Company has not given any loans or guarantees to any party. Non - current investments amounting to Rs. 545.91 lac were made prior to the year 2014 - 15. Current investments amounting to Rs. 1899.37 Lac outstanding at the end of the year have been made in different mutual funds. These investments are exhibited in Note no. 13 and 15 respectively in the Balance Sheet. These investments are within the limits prescribed under section 186 of the Act.

12. INDUSTRIAL RELATIONS

Industrial relations continued to be cordial during the year under review at both the manufacturing units of the Company except due to workers' strike at Petlad Unit, there was interruption in production for about 10 days during the month of May, 2014.

13. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. An Internal Complaints Committee has been set up to redress complaints received regarding sexual harassment. During the year, no complaints of sexual harassment were received.

14. PARTICULARS OF EMPLOYEES (ANALYSIS OF REMUNERATION)

The information required pursuant to section 197 (12) of the Act read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of the employees of the Company are given in Annexure "A".

15. SUBSIDIARY AND ASSOCIATE COMPANIES '

There is no Subsidiary of the Company. However, M/s Eurotex Industries and Exports Limited (CIN : L70200MH1987PLC042598) is its Associate Company in the meaning of section 2(6) of the Act. Form AOC-1 as required under section 129(3) of the Act is attached as Annexure "A(1)".

16. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on Arm's Length Basis and were in the ordinary course of business. No materially significant related party transactions were made by the Company with Promoters, Directors, Key Managerial Personnel, other designated persons or other related parties, which may have potential conflict with the interest of the Company at large.

All related party transactions were placed before the Audit Committee from time to time and also before the Board for approval.

The Policy on Related Party Transactions as approved and as adopted by the Board has been uploaded on the Company's Website at http://www.pbmDolvtex.com/attachments/article/47/related%20partv.pdf. Form AOC-2 as required under section 134(3)(h) of the Act read with rule 8(2) of the Companies (Accounts) rules, 2014 is attached as Annexure "A(2)".

17. DISCLOSURE ON CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

In terms of Sub-section 3 (m) of Section 134 of Companies Act, 2013, particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo are given in Annexure "B" forming part of this report.

18. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of Annual Report in Form MGT - 9 is annexed herewith as Annexure "C".

19. DIFFERENT POLICIES UNDER COMPANIES ACT, 2013 AND LISTING AGREEMENT

The Company has approved the following policies and the same have been placed on the Company's website:

A. Corporate Social Responsibility (CSR) Policy

The details in respect of terms of reference, composition and meeting of CSR Committee is disclosed in Corporate Governance Report attached with Annual Report. A report on CSR activities, forming part of the Directors' Report, is attached as Annexure "D".

B. Vigil Mechanism / Whistle Blower Policy

The details about this policy are disclosed in Corporate Governance Report appended with Annual Report.

C. Policy on Director's Appointment and Remuneration

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management Personnel and fixing their remuneration. The policy on Director's appointment and remuneration has been given in Corporate Governance Report which forms part of this report.

D. Risk Management Policy

The Company has a structured Risk Management Policy. The Risk management process is designed to safeguard the organisation from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making. It is dealt with in greater details in the management discussion and analysis section.

E. Review of operation of various Committees:

The Company has already formed the following committees to ensure timely compliances of all the applicable rules and regulations: 1) Audit Committee, 2) Nomination & Remuneration Committee, 3) Corporate Social Responsibility Committee, and 4) Stakeholders Relationship Committee . The details about these committees are given in the Corporate Governance Report.

20. INSURANCE

All the properties of the Company including plant and machinery, stocks etc. have been adequately insured. The Company has also taken adequate insurance cover for Loss of Profit and Standing Charges.

21. AUDITORS

A. Statutory Auditors

M/s. Mahendra N. Shah & Co., Chartered Accountants (FRN 105775W) Ahmedabad, the retiring Auditors, are eligible for reappointment as such for the said period of two years (i. e. for the financial year 2015 - 16 and 2016 - 17) as per section 139 (2) of the Act. They have given their consent and certificate of eligibility for appointment as such for the said period of two years. The Board of Directors request you to re-appoint them for the said period of two years and fix their remuneration. The observation of the Auditors in their report, together with the notes on Accounts, are self-explanatory and therefore, in the opinion of the Directors, do not call for any further explanation.

B. Secretarial Auditors

Pursuant to the provisions of section 204 of the Act and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s Samdani Shah and Associates, a firm of Practicing Company Secretaries, Vadodara, as Secretarial Auditors for the year 2014-15 and also for the year 2015-16 to undertake Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure "E". The Company has appointed all the Key Managerial Personnel except Company Secretary. However, the Company has recruited one qualified member of the ICSI.

C. Cost Auditor

Shri B. C. Desai, the Cost Accountant (Membership No. M-1077), Ahmedabad has been appointed as Cost Auditor to audit cost records and statements of the Company for the year 2015-16.

D. Internal Auditors

M/s. Madanlal Sharma & Co. Chartered Accountants and M/s. Shah Baheti Chandak & Co., Chartered Accountants have been appointed as Internal Auditors to conduct the internal audit of the Company for the year 2015-16.

22. REPORT ON CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT

A Report on Corporate Governance and Management Discussion and Analysis as required under Clause 49 of the Listing Agreement and forms part of this Report, is annexed herewith as Annexure "F". ,

23. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

No material changes and commitments affecting the financial position of the Company have occurred between the end of the financial year to which the financial statements relate and the date of this Directors' Report.

24. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

No significant and/or material orders were passed by any regulator or court or tribunal impacting the going concern status and the Company's operations in future.

25. INTERNAL CONTROL SYSTEMS

The Company has adequate internal control systems, commensurate with the size and scale of the Company. Internal Auditors have been appointed for Petlad as well as Borgaon units of the Company who submit their periodical report to the Board and necessary advises are adopted and needful is done, if required for better control.

26. DEPOSITS

The Company has not accepted or continued any public deposits as contemplated under Chapter V of the Act.

27. ACKNOWLEDGEMENTS

All the employees of the Company, the bankers and financial institutions extended their full cooperation, support and valuable assistance to the Company. Your Directors place on record their appreciation for the same.

For PBM POLYTEX LIMITED Place: Vadodara KRISHAN KUMAR PATODIA Date : 6th August 2015 Chairman (DIN : 00027335)




Mar 31, 2014

Dear Shareholders,

The Directors have pleasure in presenting the 95th Annual Report of the Company with the Audited Statements of Accounts for the year ended 31st March 2014.

FINANCIAL RESULTS:

(Rs. In Lacs)

2013 - 14 2012 - 13

Gross Profit 3534.44 2699.12

Less: Depreciation 562.22 586.46

Profit before Tax 2972.22 2112.66

Less / Provision for Taxation 1016.44 801.09

1955.78 1311.57

Add Defered Tax Reversal 13.85 38.57

Profit for the year (After Tax) 1969.63 1350.14

Add: Surplus brought forward 1487.47 477.54

Amount available for Appropriation 3457.10 1827.68

Appropriation :

General Reserve 200.00 150.00

Proposed Dividend 203.23 162.58

Corporate Dividend Tax 34.54 27.63

437.77 340.21

Balance caried to Balance Sheet 3019.33 1487.47

3457.10 1827.68

DIVIDEND

Your Directors recommend a Dividend @ 25% (Twenty Five Percent) on the paid up equity share capital of the company for the year ended 31st March 2014.

OPERATIONAL REVIEW

Yarn market remained favourable in greater part of the year. Appreciation in Dolar exchange rate in terms of rupee also helped in better realization for export Yarn. The cotton prices however went high in last about 4 months of the year. The management continued to keep other cost of production in control. Instalation of machineries of latest technology requiring lesser man power and Power Consumption also helped in reduction of cost. Al these factors have helped the company in achieving good financial results for the year.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the Provisions of Section 217(2AA) of the Companies Act 1956, your Directors confirm that -

1. In preparing the Annual Accounts, al applicable Accounting Standards have been folowed and there are no material departures;

2. the accounting policies adopted are consistently folowed and the judgments and estimates made 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 of the Company for the Financial Year under review;

3. The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing / detecting fraud and other iregularities;

4. The Annual Accounts have been prepared on a going concern basis.

INDUSTRIAL RELATIONS

Industrial relations continued to be cordial during the year under review at both the manufacturing units of the company.

ISO CERTIFICATION:

The company strictly adheres to the Quality Management Systems. Your Directors are pleased to inform that your company continues to be the holder of ISO 9001:2008 License granted by the Bureau of Indian Standards.

REGARDING COMPANY SECRETARY

We refer to the remark of the Auditors in Report on other Legal and Regulatory requirements (point -2b) at Para 4 (ii) of Auditors'' Report and sub - note No.9 of Part II of Note 28 regarding non-availability of qualified Company Secretary. The Note is self-explanatory. However, the company has retained a practicing company secretary and a certificate has been obtained from him for compliance of al the rules and regulations. The management is also making al efforts to avert non-compliance of the provisions of law in this regard.

DISCLOSURE OF PARTICULARS

In terms of Sub-section (2A) of Section 217 of Companies Act 1956 the required particulars are given in Annexure "A" forming part of this report..

Particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo are given in Annexure ''B'' forming part of this report.

Compliance Certificate of the Practicing Company Secretary as required under section 383(A) is attached herewith vide Annexure "C.

REPORT ON CORPORATE GOVERNANCE AND MANAGERIAL DISCUSSIONS AND ANALYSIS REPORT

A Report on Corporate Governance and Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached and forms part of this Report.

INSURANCE

Al the properties of the Company including plant and machinery, stocks etc. have been adequately insured. The Company has also taken adequate insurance cover for Loss of Profit and Standing Charges.

DIRECTORS

Shri Krishna Kumar Patodia and Shri.Gopal Patodia retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The directors recommend their re-appointment as proposed in the Notice for Annual General Meeting.

AUDITORS

M/s. Mahendra N. Shah & Co., Chartered Accountants (FRN 105775W) Ahmedabad, the retiring Auditors have given the certificate pursuant to Section 139 of the Companies Act 2013 and as such are eligible for re-appointment. The Board of Directors requests you to re-appoint them for the year 2014-2015 and fix their remuneration.

ACKNOWLEDGEMENTS

Al the employees of the company, the bankers and financial institutions extended their ful cooperation, support and valuable assistance to the company. Your Directors place on record their appreciation for the same.

On Behalf of the Board of Directors,

Place: Vadodara KRISHAN KUMAR PATODIA

Date: 24th May 2014 Chairman


Mar 31, 2013

Dear Shareholders,

The Drectors have pleasure n presentng the 94th Annual Report of the Company wth the Audted Statements of Accounts for the year ended 31st March 2013.

FINANCIAL RESULTS:

(Rs.In Lacs) 2012- 13 2011 - 12

Gross Profit 2699.12 750.31

Less: Depreciaton 586.46 653.09

Proft before Tax 2112.66 97.22

Less / Provison for Taxaton 801.09 141.12

1311.57 (43.90)

Add Deferred Tax Reversal 38.57 87.04

Proft for the year (After Tax) 1350.14 43.14

Add: Surplus brought forward 477.54 1076.12

Amount avalable for Appropraton 1827.68 1119.26

Transfer to:

General Reserve 150.00 500.00

Proposed Dvidend 162.58 121.94

Corporate Dvidend Tax 27.63 19.78

340.21 641.72

Balance carred to Balance Sheet 1487.47 477.54

1827.68 1119.26

DIVIDEND

Your Drectors recommend a Dvidend @ 20% (Twenty Percent) on the pad up equty share captal of the company for the year ended 31st March.

OPERATIONAL REVIEW

Durng the fnancial year under review the cotton prces, though ncreased n the fourth quarter but t remnd mostly stable durng the remanng perod of the year. The yarn market also remaned favourable. These two factors n partcular and company''s policy of contnuous modernzaton of the manufacturng plant as wel as keepng the costs under control has helped the company n acheving good fnancial results. The term loan obtaned for the frst two wnd mls has also been pad fuly whch has also contrbuted to hgher cash flow from wndmls on account reduction n nterest cost.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the Provisons of Section 217(2AA) of the Companes Act 1956, your Drectors confrm that -

1. In preparng the Annual Accounts, al applicable Accounting Standards have been folowed and there are no materal departures;

2. the accountng policies adopted are consstently folowed and the judgments and estmates made are reasonable and prudent so as to give a true and far view of the state of affars of the Company at the end of the Fnancial Year and of the Proft of the Company for the Fnancial Year under review;

3. The Drectors have taken proper and suffcient care for the mantenance of adequate accountng records in accordance wth the provisons of the Act for safeguardng the assets of the Company and for preventng / detecting fraud and other rregulartes;

4. The Annual Accounts have been prepared on a gong concern basis.

INDUSTRIAL RELATIONS

The Company contnued ts endeavor n mantanng peace and harmony at al levels of employment at both the manufacturng unts of the Company n the year under review.

ISO CERTIFICATION:

The company strctly adheres to the Quality Management Systems and has accordngly been granted ISO 9001:2008 Lcense by the Bureau of Indan Standards.

REGARDING COMPANY SECRETARY

We refer to the remark of the Audtors at Para 4 () of Audtors'' Report and sub - note No.9 of Part II of Note 28 regardng non-avalablity of qualified Company Secretary. The Note s self- explanatory. However, the company has retaned a practicing company secretary and a certfcate has been obtaned from hm for compliance of al the rules and regulatons. The management s also making al efforts to avert non-compliance of the provisons of law n ths regard.

DISCLOSURE OF PARTICULARS

In terms of Sub-section (2A) of Secton 217 of Companes Act 1956 the requred partculars are given n Annexure "A" formng part of ths report..

Partculars relatng to conservaton of energy, technology absorpton, foregn exchange earnngs and outgo are given n Annexure ''B'' formng part of ths report.

Compliance Certfcate of the Practicing Company Secretary as requred under section 383(A) s attached herewth vide Annexure "C.

REPORT ON CORPORATE GOVERNANCE AND MANAGERIAL DISCUSSIONS AND ANALYSIS REPORT

A Report on Corporate Governance and Management Dscusson and Analyss as requred under Clause 49 of the Lstng Agreement s attached and forms part of ths Report.

INSURANCE

Al the propertes of the Company ncludng plant and machnery, stocks etc. have been adequately nsured. The Company has also taken adequate nsurance cover for Loss of Proft and Standng Charges.

DIRECTORS

Shr Dharam Paul has conveyed hs un-ablity to contnue n offce as drector of the Company and has submtted hs resgnaton on 8th May 2013 whch has been accepted by the Board of Drectors. The Board of Drectors expresses sncere appreciaton for the effcient, valuable and matured advice of Shr Dharam Paul to the Company durng the tenure of hs offce as a drector of the Company.

Shr Brjbhushanlal Kabra, and Shr Jugal Kishore Tod retre by rotaton at the ensung Annual General Meetng and beng eligible offer themselves for re-appontment. The drectors recommend ther re-appontment as proposed n the Notce for Annual General Meetng.

AUDITORS

M/s. Mahendra N. Shah & Co., Chartered Accountants (FRN 105775W) Ahmedabad, the retrng Audtors have given the certfcate pursuant to Secton 224(1B) of the Company''s Act and as such are eligible for re-appontment. The Board of Drectors requests you to re-appont them for the year 2013-2014 and fx ther remuneraton.

ACKNOWLEDGEMENTS

Al the employees of the company, the bankers and fnancial insttutons extended ther ful cooperaton, support and valuable assstance to the company. Your Drectors place on record ther appreciaton for the same.

On Behalf of the Board of Drectors,

Place: Vadodara KRISHAN KUMAR PATODIA

Date: 17th May 2013 Charman


Mar 31, 2012

The Directors have pleasure in presenting the 93rd Annual Report of the Company with the Audited Statements of Accounts for the year ended 31st March 2012.

FINANCIAL RESULTS:

(Rs. In Lacs)

2011 - 12 2010 - 11

Gross Profit 750.31 3033.46

Less : Depreciation 653.09 716.72

Profit before Tax 97.22 2316.74

Less / Provision for Taxation 141.12 847.08

(43.90) 1469.66

Add Deferred Tax Reversal 87.04 39.10

Profit for the year (After Tax) 43.14 1508.76

Add: Surplus brought forward 1076.12 361.85

Amount available for Appropriation 1119.26 1870.61

Transfer to:

General Reserve 500.00 700.00

Proposed Dividend 121.94 81.30

Corporate Dividend Tax 19.78 13.19

641.72 794.49

Balance carried to Balance Sheet 477.54 1076.12

1119.26 1870.61

DIVIDEND

Your Directors recommend a Dividend @ 15 % on the paid up equity share capital of the company for the year ended 31st March 2012 out of accumulated profits.

OPERATIONAL REVIEW

The Company experienced a set back during the year mainly due to continuous declining trend in yarn prices during the period April 2011 to September 2011 consequent upon the ban on exports imposed by the Government during the period December 2011 to March 2012. The ban on exports resulted in mounting of stocks not with our Company alone but with the s pinning industry as a whole. Stocks of cotton purchased during the period December 2010 to March 2011 at very high price cons umed during the first half of the year were also greatly responsible for loses during the first half of the year. The situation was throughout India in spinning sector from which our Company also could not be scarred. The situation however gradually improved since October - November 2011.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the Provisions of Section 217(2AA) of the Companies Act 1956, your Directors confirm that -

(1) In preparing the Annual Accounts , all applicable Accounting Standards have been followed and there are no material departures;

(2) the accounting policies adopted are consistently followed and the judgments and estimates made 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 of the Company for the Financial Year under review;

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

(4) The Annual Accounts have been prepared on a going concern basis.

INDUSTRIAL RELATIONS

The Company continued its endeavor in maintaining peace and harmony at all levels of employment at both the manufacturing units of the Company in the year under review.

ISO CERTIFICATION:

The company strictly adheres to the Quality Management Systems and has accordingly been granted ISO 9001:2008 License by the Bureau of Indian Standards .

REGARDING COMPANY SECRETARY

We refer to the remark of the Auditors at Para 4 (ii) of Auditors' Report and sub - note No.9 of Part II of Note 28 regarding non-availability of qualified Company Secretary. The Note is self-explanatory. However, the company has retained a practicing company secretary and a certificate has been obtained from him for compliance of all the rules and regulations. The management is also making all efforts to avert non- compliance of the provisions of law in this regard.

DISCLOSURE OF PARTICULARS

There are no employees who were paid remuneration exceeding Rs. 60,00,000 or more during the year or Rs . 5,00,000 or more per month during the part of the year and as such no information is required to be given in terms of subsection (2A) of Section 217 of the Companies Act 1956.

Particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo are given in Annexure 'A' forming part of this report.

Compliance Certificate of the Practicing Company Secretary as required under section 383(A) is attached herewith vide Annexure 'B'.

REPORT ON CORPORATE GOVERNANCE AND MANAGERIAL DISCUSSIONS AND ANALYSIS REPORT

A Report on Corporate Governance and Management Discussion and Analysis as required under Clause 49 of the Listing Agreement is attached and forms part of this Report.

INSURANCE

All the properties of the Company including plant and machinery, stocks etc. have been adequately insured. The Company has also taken adequate insurance cover for Loss of Profit and Standing Charges.

DIRECTORS

Shri Gopal Patodia, Shri Mohan Kumar Patodia and Shri Hari Prasad Siotia retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

AUDITORS

M/s. Mahendra N. Shah & Co., Chartered Accountants (FRN 105775W) Ahmedabad, the retiring Auditors have given the certificate pursuant to Section 224(1B) of the Company's Act and as such are eligible for re-appointment. The Board of Directors requests you to re-appoint them for the year 2012-2013 and fix their remuneration.

ACKNOWLEDGEMENTS

All the employees of the company, the bankers and financial institutions extended their full cooperation, support and valuable assistance to the company. Your Directors place on record their appreciation for the same.

On Behalf of the Board of Directors,

Place : Vadodara KRISHAN KUMAR PATODIA

Date : 9th August 2012 Chairman

 
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