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Directors Report of SBEC Sugar Ltd.

Mar 31, 2016

DIRECTORS'' REPORT

To,

The Shareholders,

SBEC Sugar Limited

The Directors take pleasure in presenting the 22nd Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2016.

FINANCIAL RESULTS

The summarized financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd for the financial year ended 31st March, 2016.

(Rs. in Lacs)

Financial Parameters

STANDALONE

CONSOLIDATED

Period ended 31.03.2016

Period ended 31.03.2015

Period ended 31.03.2016

Period ended 31.03.2015

Sales and other income

39478.31

43096.67

40465.59

44187.24

Profit/(Loss) Before Interest, Depreciation & Tax

1356.66

(1635.97)

1647.61

(1155.73)

Interest and Finance Charges

526.94

921.36

1034.37

1287.14

Depreciation and Amortization

311.14

281.15

353.93

324.19

Prior period expenses (net)

Profit/(Loss) before Extra-Ordinary Expenses &

2.44

22.98

20.97

33.35

Provision for Taxation

516.14

(2861.45)

238.34

(2800.41)

Exceptional Items

-

-

-

-

Profit/(Loss) before Tax

516.14

(2861.45)

238.34

(2800.41)

Provision for Taxation

-

-

12.97

-

Deferred Tax Charge/ (Credit) Taxes for earlier

years

-

-

(65.26)

16.59

MAT credit written back

-

-

-

-

Profit/(Loss) After Tax

516.14

(2861.45)

290.63

(2817.00)

Transfer to Minority Interest

-

-

(82.54)

20.39

Transfer to Molasses Storage Fund

3.34

1.52

3.34

1.52

Profit/(Loss) for the period after appropriation

512.80

(2862.97)

369.83

(2838.91)

Earnings Per Share (in Rs.)

1.08

(6.00)

0.78

(5.95)

OPERATIONS

For the Financial Year 2015-16, there is a Profit of Rs. 516.14lac as against a loss of Rs. (2861.45) lac in the previous year for 12 months period. Higher recovery and increased sugar prices have generated the cash profits after so many years and the same shall help in liquidating the cane arrears to some extent.

DIVIDEND & RESERVES

In view of inadequate profits, your Board is unable to recommend any dividend for the financial year ended March 31, 2016. The Company has not transferred any amount to the reserves for the year ended March 31, 2016.

SHARE CAPITAL

The paid up equity capital as on March 31, 2016 was Rs.47.65 Lacs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

OPERATIONS

The crushing for the season 2015-16 started on 20.11.2015 i.e.9 days earlier as compared to 2014-15 in the previous season and ended on 10.04.2016 as against 2014-15, 17 days earlier than the previous season. During the season, the plant crushed 107.20 lac quintals of sugarcane in 159 days as against 111.03 lac quintals in 155 days in the previous season. The crushing was increased by 3.83 lac quintals during this season due to increase period of crushing .The sugar recovery overall was increase at 9.55% as against 9.17% in the previous season.

The Company continued to focus on cane development activities, comprising clean cane, varietal change and modern agriculture practices that is expected to improve recovery in the coming years.

MATERIAL CHANGES AND COMMITMENTS

No material changes or commitments have occurred between the end of the financial period to which the financial statements relate and the date of this report, affecting the financial position of the Company.

STATUS OF SICKNESS UNDER BIFR

As the members are aware, the Company had reported the erosion in the net worth of the Company by more than 50% of the peak net worth as required under Section 23 of the Sick Industrial Companies (Special Provisions) Act, 1985 to BIFR and the BIFR has declared the Company as sick and appointed IDBI as operating agency u/s 17(3) of the Act in its hearing held on dated 04th February, 2014.

SUBSIDIARY COMPANIES

As on March 31st 2016, the Company has one Wholly Owned Subsidiary i.e. SBEC Stockholding & Investments Limited and one Subsidiary i.e. SBEC Bioenergy Limited. There are no associates companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and all its subsidiary companies, which is forming part of the Annual Report. A statement containing salient features of the financial statements of the subsidiary companies is also included in the Annual Report in "Annexure-A".

In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.sbecsugar.com. Further, as per fourth proviso of the said section, audited annual accounts of each of the subsidiary companies have also been placed on the website of the Company, www.sbecsugar.com. Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary at the Company''s registered office.

On the basis of Audited Financials Accounts of the Company for the FY. 15-16 the Company has two Material Subsidiaries Company

i.e. SBEC Bioenergy Limited and SBEC Stockholding & Investment Limited. The Minutes of the Board Meetings of the subsidiary companies are placed at the Board Meetings of the Company. Details of significant transactions and arrangements entered into by the subsidiary companies are noted by the Board. The Audit Committee of the Company reviews the financial Statement of the subsidiary companies including investments made.

There has been no change in relationship of any subsidiary company during the financial year.

CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements of the Company for the financial period 2015-16, are prepared in compliance with applicable provisions of the Companies Act, 2013, Accounting Standards and SEBI (LODR) Regulations, 2015.

DIRECTORS

Shri. Manmohan, expired on 16.02.2016, Shri. O.P. Modi, expired on 03.06.2016 and Shri. G.C. Jain resigned from the office of Director of the Company with effect from 07.04.2015 due to old age.

The Board of Directors placed on record its sincere appreciation for the valuable support and guidance given by Shri. Manmohan, Shri. O.P. Modi and Shri. G.C. Jain to the Company during their tenure as Director of the Company.

Shri. Rohit Garg was appointed as an Independent Director w.e.f. 25.03.2016 in casual vacancy caused due to untimely demise of Shri. Manmohan.

Shri. Vijay Kumar Modi appointed as Non-executive Director on the Board of the Company w.e.f. 24th September, 2015 and will be appoint as an Independent Director of the Company in the forthcoming Annual General Meeting.

Shri. Rohit Garg and Shri. Vijay Kumar Modi have submitted declarations confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Smt. Kumkum Modi (DIN 00522904), Non-Executive Director of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer herself for re-appointment.

Shri. Rajeev Kumar Agarwal, Shri. Jagdish Chandra Chawla and Shri. Shyam Babu Vyas was appointed as a Non-executive Independent Director of the Company who holds office for a term of five consecutive years commencing from September 24, 2015. Shri. Norland L.C. Suzor and Shri. Claude Philogene ceased to be the director of the Company under Section 167 of the Companies Act, 2013 w.e.f. 27th May, 2015.

Shri. N.P. Bansal who has been appointed as an alternate director during the absence of Shri. Philogene Jacques Henri Claude be and is hereby ceased to be the alternate director and appointed Non-executive Director on the Board of the Company w.e.f. 27th May, 2015.

KEY MANAGERIAL PERSONNEL (KMP)

During the financial period ended 31.03.2016, following persons are Whole Time Key Managerial personnel (KMP) of the Company in terms of provisions of Section 203 of the Companies Act, 2013:

SI. No.

Name

Designation

1.

Shri. Abhishek Modi

Whole Time Director

2.

Shri. L.C. Sharma*

Chief Financial Officer

3.

Shri. Shobit Nehra**

Company Secretary

- Shri. Lakhmi Chand Sharma was appointed as Chief Financial Officer of the Company w.e.f. 27th May, 2015.

- Shri. Shobit Nehra was appointed as Company Secretary and Compliance Officer of the Company w.e.f. 07th April, 2015.

BOARD MEETINGS

The Board met Eight times during the financial year 2015-16, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013 and the SEBI (LODR), Regulations, 2015.

FORMAL ANNUAL EVALUATION

Pursuant to the requirements of Section 134(3)(p) of the Companies Act, 2013 read with Regulation 17 of the SEBI (Listing Obligations and Disclosure Requirements), 2015 the Board has carried out an annual performance evaluation of its own performance, the Directors individually and the Committees viz., Audit, Nomination & Remuneration and Stakeholders Relationship Committee.

A structured questionnaire was prepared after taking into consideration the inputs received from the Directors covering various aspects of the Board''s functioning such as adequacy of the composition of the Board and its Committees, Board culture, execution and performance of specific duties, obligation and governance.

A separate exercise was carried out to evaluate the performance of individual directors including the Chairman of the Board, who were evaluated on parameters such as level of engagement and contribution, independence of judgement, safeguarding the interests of the Company and its minority shareholders etc. The performance evaluation of Independent Directors was carried out by the entire Board. The performance evaluation of the Chairman and the Non Independent Directors was carried out by the Independent Directors at their meeting held separately. The Directors expressed their satisfaction with the evaluation process.

DIRECTOR''S RESPONSIBILITY STATEMENT:

Pursuant to the provisions contained in Section 134 (5) of the Companies Act, 2013, your Directors to the best of their knowledge and belief and according to information and explanations obtained from the management, confirm that:

a) in the preparation of the annual accounts for the financial year ended March 31, 2016, the applicable accounting standards have been followed and there are no material departures from the same;

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 as at March 31, 2016 and of the profit and loss of the Company for the year ended on that date;

c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) The Directors have prepared the Annual Accounts on a going concern basis.

e) The Directors have laid down proper internal financial controls to be followed by the Company and such controls are adequate and operating effectively; and

f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

DECLARATION FROM INDEPENDENT DIRECTORS

All Independent Directors of the Company have given declarations that they meet the criteria of Independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (LODR), Regulations, 2015.

INTERNAL FINANCIAL CONTROLS

Your company has in place an adequate internal control system in order to ensure that all transactions are authorized, recorded and reported correctly and that all assets are protected against the perils of unauthorized use or disposition. Towards enhancing the efficiency of internal controls, services of consultants are hired wherever necessary, and their suggestions are reviewed and implemented. Your Company has in place an Internal Audit system, whereby an independent professionals firm of Internal Auditors conducts regular audit across the Company and their scope and findings are reviewed by the Management and Audit Committee on a regular basis.

The Audit Committee of the board also meets periodically to review the internal controls, internal audit findings, action taken reports and to advise the management on corrective policies, if any.

STATUTORY AUDITORS

M/s Doogar & Associates., Chartered Accountant, Statutory Auditors of the Company who are our Auditors, retire at the ensuing Annual General Meeting and are eligible for reappointment.

As required under the provisions of Section 139 of the Companies Act, 2013, the Company has received a written consent from the auditors to their re-appointment and a certificate to the effect that their re-appointment, if made, would be in accordance with the Companies Act, 2013 and the rules framed there under and that they have satisfied the criteria provided in Section 141 of the Companies Act, 2013.

The Board recommends the re-appointment of M/s. Doogar & Associates., Chartered Accountants, as statutory auditors of the Company from the conclusion of Annual General Meeting till the conclusion of the next Annual General Meeting.

STATUTORY AUDITOR''S REPORT

The Auditors Report contains qualifications and the Company has given its comments on Auditor Qualified Opinion for the Financial Year 2015-16. The details are mentioned here under:

Qualified Opinion (a)

Non-provision for interest on late payment of cane dues, it is hereby clarified that the company has not made provision of interest on late payment of cane dues, as it is negotiating with the farmers for its waiver. In case it has to be paid, it will be accounted for in the year of payment.

Qualified Opinion (b)

The company had executed a deed of assignment with a subsidiary company "SBEC Bioenergy Limited" to transfer its claim and all securities and charges created by Modi Industries Limited in its favour for a consideration of Rs. 12,500 lacs of which Rs. 8,300 lacs shall be received as per the mutually agreed installments within a period of five years from the date of execution of the deed. In view of current cash flow of the Subsidiary Company (i.e. SBEC Bioenergy Limited) the management on request has agreed to extend the time period of deed of assignment for a further period of five years.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company during the year under review.

COST AUDITORS

As per Section 148 of the Companies Act 2013 read with Rule 4 of the Companies (Cost Records and Audit) Rules, 2014, the cost records maintained by the Company in respect of its Sugar and Cogeneration activity are required to be audited by a Cost Auditor. The Board of Directors, based on the recommendation of the Audit Committee, appointed M/s. M.K. Singhal & Co., Cost Accountants, as the Cost Auditors for auditing the cost accounting records maintained by the Company for the financial year 2016-17 on a remuneration of Rs.60,000/- plus service tax as applicable and reimbursement of out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking member''s approval of the remuneration payable to the Cost Auditor forms part of the notice convening the Annual General Meeting.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s R. Singhal & Associates, Company Secretaries in practice as the Secretarial Auditor to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is given in "Annexure-B" to this Report.

The observation in secretarial audit report is self-explanatory and therefore not calls for any further explanation.

FIXED DEPOSITS

During the financial year, the Company has not accepted any public deposits. The Company has repaid all its Fixed Deposits of Rs.6, 58,25,000/- due for repayment. The Company does not have any fixed deposits at the end of financial year March 31, 2016. RISK MANAGEMENT POLICY

As per Section 134(3) (n) of the Companies Act, 2013, the Company has a Risk Management Policy to identify, assess, monitor and mitigate various risks to key business objectives. Major risks identified are systematically addressed through mitigating actions on a continuing basis. These are discussed at the meetings of the Audit Committee and the Board of Directors of the Company.

AUDIT COMMITTEE

The Audit Committee comprises of four Independent Directors, viz., Shri. R.K. Agarwal as Chairman, Shri. J.C. Chawla, Shri. Manmohan and Shri. O.P. Modi as Members. The details of terms of reference of the Audit Committee, number and dates of meeting held, attendance, among others are given separately in the attached Corporate Governance Report.

NOMINATION AND REMUNERATION COMMITTEE

Pursuant to the provisions of Section 178 of the Companies Act, 2013 read with Rules made there under, the Board has constituted a Nomination & Remuneration Committee and the details of terms of reference, number & dates of meeting held, attendance and other details are given separately in the attached Corporate Governance Report. The Board on the recommendation of Nomination & Remuneration Committee framed a policy i.e. Nomination and Remuneration Policy for selection and appointment of Directors, senior managerial personnel and their remuneration. The aforesaid policy can be accessed on the Company''s Website www.sbecsugar.com

REMUNERATION POLICY

The Company has adopted a Remuneration Policy for executive and non-executive directors and persons who may be appointed in Senior Management and Key Managerial positions and to determine their remuneration as approved by the Board of Directors on the recommendation of Nomination and Remuneration Committee. The remuneration so approved is subject to the approval by the shareholders and such other authorities as the case may be. The remuneration policy is also placed on Company''s website. The Non-Executive Directors do not draw any remuneration from the Company except sitting fee paid to them for each meeting of the Board/ Committee thereof attended by them.

CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES.

Section 135 of the Companies Act, 2013 provides the threshold limit for applicability of the CSR to a Company i.e. (a) net worth of the Company to be Rs. 500 crore or more; or (b) turnover of the company to be Rs. 1,000 crore or more; or (c) net profit of the company to be Rs.5 crore or more. As the Company does not fall under any of the threshold limits given above, the provisions of Section 135 are not applicable to the Company.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 134(3) (m) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is enclosed in "Annexure-C" and forms part of this Report.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) read with Rule, 5 (1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, relating to ratio of the remuneration of each Director to the median employee''s remuneration and other details shall be provided on request, in accordance with the provisions of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, none of the employee is drawing remuneration in excess of the limits set out in the said Rules.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the financial year 2015-16, the company has not made any investment nor given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

RELATED PARTY TRANSACTIONS

All contracts/arrangements/transactions entered into during the financial year with the related parties were on arm''s length basis and were in the ordinary course of business. Section 188(1) of the Companies Act, 2013 exempts related party transactions that are in the ordinary course of business and are on arm''s length basis. However, as per Regulation 23 of SEBI (LODR) Regulations, 2015 (Earlier clause 49 of the Listing Agreement), all material Related Party Transactions requires approval of the shareholders through special resolution. Accordingly, the Company has obtained the approval of the shareholders by way of special resolution for the material related party transactions. The Board of Directors and the Audit Committee have also approved the said related party transactions. There are no materially significant related party transactions with the promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

The particulars of the material contract and arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 read with Regulation 23 of SEBI (LODR) Regulations, 2015 (Earlier clause 49 of the Listing Agreement) is disclosed separately in Form No. AOC -2 as "Annexure-D" and forms part of this report.

The Board has framed a Policy on related party transactions and placed the same on the Company''s website at www.sbecsugar.com. Your director draw attention of members to Note No. 38 of the financial statement which sets out related party disclosures.

VIGIL MECHANISM & WHISTLE BLOWER POLICY

The Company has formulated and implemented the Whistle Blower Policy/ vigil mechanism. This has provided a mechanism for directors and employees of the Company and other persons dealing with the Company to report to the Chairman of the Audit Committee; any instance of unethical behavior, actual or suspected fraud or violation of the Company''s code of conduct. The aforesaid policy has also been uploaded on the Company''s website at www.sbecsugar.com.

EXTRACT OF THE ANNUAL RETURN

The details of the extract of the Annual Return in Form MGT-9 as per the provisions of Section 92 of Companies Act, 2013 read with rule 12 of Companies (Management and Administration) Rules, 2014 is annexed herewith and marked as "Annexure-E" to this Report.

BOARD DIVERSITY

The Company recognizes and embraces the importance of a diverse board in its success. We believe that a truly diverse board will leverage differences in thought, perspective, knowledge, skill, regional and industry experience, cultural and geographical background, age, ethnicity, race and gender, which will help us retain our competitive advantage. The Board has adopted the Board Diversity Policy which sets out the approach to diversity of the Board of Directors. The Board Diversity Policy is available on our website www. sbecsugar.com.

CORPORATE GOVERNANCE

In Compliance with Regulation 17 to 27 of SEBI (Listing Obligation and Disclosure Requirements), Regulations, 2015, a detailed Corporate Governance Report has been given elsewhere in this report, along with Management Discussion and Analysis Report, which form an integral part of the Annual Report.

A certificate from R. Singhal & Associates, a firm of Company Secretaries in practice confirming compliance by the Company with the conditions of Corporate Governance as stipulated under part E of schedule V of SEBI (Listing Obligation and Disclosure Requirements), Regulations, 2015 is attached to this report.

The Whole Time Director and the Chief Financial Officer have submitted a certificate to the Board regarding the financial statements and other matters as required under SEBI (LODR), Regulations, 2015.

PERSONNEL RELATIONS

Your directors hereby place on record their appreciation for the services rendered by the executives, staff and workers of the Company for their hard work, dedication and commitment. During the year under review, relations between the employees and the management continued to remain cordial.

APPRECIATION

Your directors thank the various Central and State Government Authorities and Agencies for the continued help and cooperation extended by them. The Directors gratefully acknowledge all stakeholders of the Company viz., farmers, customers, members, dealers, vendors and banks for their excellent support during the year. The Directors also place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued cooperation to the Company.

For & behalf of the Board

SBEC Sugar Limited

Sd/- Sd/-

Abhishek Modi R.K. Agarwal

Place: New Delhi (Whole Time Director) (Director)

Date: 12th August, 2016 (DIN: 00002798) (DIN: 00298252)


Mar 31, 2015

To,

The Shareholders,

SBEC Sugar Limited

Dear Members,

The Directors take pleasure in presenting the 21st Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2015.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd for the financial year ended 31st March, 2015. The consolidation financial results of SBEC Sugar Ltd. with M/s Modi Casings & Packaging Private Limited (Formerly known as M/s Modi Gourmet Limited) is upto 30.06.2014 and on 27.07.2014 it ceases to be subsidiary of the Company:

(Rs. in Lacs)

SBEC SUGAR LTD. CONSOLIDATED

Financial Parameters Period ended Period ended Period ended Period ended 31.03.2015 31.03.2014 31.03.2015 31.03.2014

Sales and other income 44638.61 40266.65 45729.18 41169.12

Profit/(Loss) Before Interest, Depreciation & Tax (1635.97) (1540.81) (1155.73) (1254.25)

Interest and Finance Charges 921.36 2584.05 1287.14 3261.12

Depreciation and Amortisation 281.15 613.14 324.19 753.76

Prior period expenses (net) 22.98 618.09 33.35 618.15

Profit/(Loss) before Extra-Ordinary Expenses & Provision for Taxation (2861.45) (5356.09) (2800.41) (5887.28)

Exceptional Items - - - -

Profit/(Loss) before Tax (2861.45) (5356.09) (2800.41) (5887.28)

Provision for Taxation - - - -

Deferred Tax Charge / (Credit) - - 16.59 (158.72)

Taxes for earlier years

MAT credit written back - 19.69 - 19.69

Profit/(Loss) After Tax (2861.45) (5375.78) (2817.00) (5748.25)

Transfer to Minority Interest - - 20.39 (167.07)

Transfer to Molasses Storage Fund 1.52 8.44 1.52 8.44

Profit/(Loss) for the period after appropriation (2862.97) (5384.22) (2838.91) (5589.62)

Earning Per Share (in Rs.) (6.00) (11.28) (5.95) (11.71)

OPERATIONS

For the Financial Year 2014-15, there is a loss of Rs. (2861.45) lac as against a loss of Rs. (5356.09) lac in the previous year for 12 months period. The Company has incurred significant operational losses in due to a steep decline in sugar prices and unrealistically high cane prices set by the U P Government.

DIVIDEND & RESERVES

In view of the losses incurred, your Board is unable to recommend any dividend for the financial year ended March 31, 2015. The Company has not transferred any amount to the reserves for the year ended March 31, 2015.

SHARE CAPITAL

The paid up equity capital as on March 31, 2015 was Rs.47.65 Lacs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

OPERATIONS

The crushing for the season 2014-15 started on 29.11.2014 i.e.5 days earlier as compared to 2013-14 in the previous season and ended on 27.04.2015 as against 2013-14, 5 days earlier than the previous season. During the season, the plant crushed 111.03 lac quintals of sugarcane in 155 days as against 91.23 lac quintals in 138 days in the previous season. The crushing was higher by 19.80 lac quintals during this season due to increase period of crushing .The sugar recovery overall was higher at 9.17% as against 8.76% in the previous season. The production of sugar was higher at 2.19 lacs quintals, as compared to 0.09 lac quintals in the previous session.

The Company continued to focus on cane development activities, comprising clean cane, varietal change and modern agriculture practices that is expected to improve recovery in the coming years.

The market sentiments for sugar during the financial year remained bearish owing the continued mismatch between sugar and demand of sugar, affecting sales realization. Further during the year the UP Government has announced very high cane price which has resulted in the Loss before extraordinary expenses and provisions for taxation to Rs. 2861.45 Lacs against the Loss of Rs. 5356.09 Lacs last year.

Due to continuing losses the company could not pay the cane dues to the farmer on time due to which they agitated and disturbed the operations at plant and the management was forced to close down the plant from 20th May, 2014 to 03rd September, 2014, which affected the administration, repair & maintenance work of the plant during the year under review.

As the members are aware, the Company had reported the erosion in the net worth of the Company by more than 50% of the peak net worth as required under Section 23 of the Sick Industrial Companies (Special Provisions) Act, 1985 to BIFR and the BIFR has declared the Company as sick and appointed IDBI as operating agency u/s 17(3) of the Act in its hearing held on dated 04th February, 2014.

SUBSIDIARY

As on March 31st 2015, the Company has one Wholly Owned Subsidiary i.e. SBEC Stockholding & Investments Limited and one Subsidiary i.e. SBEC Bioenergy Limited. There are no associates companies within the meaning of Section 2(6) of the Companies Act, 2013 ("Act"). There has been no material change in the nature of the business of the subsidiaries.

During the year 2014-15 M/s. Modi Casings and Packing Private Limited (formerly known as Modi Gourmet Limited) ceased to be Subsidiary of the Company w.e.f. 27.07.2014 under review.

In accordance with Section 129(3) of the Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company and all its subsidiary companies, which is forming part of the Annual Report. A statement containing salient features of the financial statements of the subsidiary companies is also included in the Annual Report in "Annexure-A".

In accordance with third proviso of Section 136(1) of the Companies Act, 2013, the Annual Report of the Company, containing therein its standalone and the consolidated financial statements has been placed on the website of the Company, www.sbecsugar.com. Further, as per fourth proviso of the said section, audited annual accounts of each of the subsidiary companies have also been placed on the website of the Company, www.sbecsugar.com. Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary at the Company's registered Office.

On the basis of Audited Financials Accounts of the Company for the FY. 14-15 the Company has two Material Subsidiaries Company i.e. SBEC Bioenergy Limited and SBEC Stockholding & Investment Limited. The Minutes of the Board Meetings of the subsidiary companies are placed at the Board Meetings of the Company. Details of significant transactions and arrangements entered into by the subsidiary companies are noted by the Board. The Audit Committee of the Company reviews the financial Statement of the subsidiary companies including investments made.

The Company has adopted a policy for determining material subsidiaries. The said policy has been placed on the website of the Company www.sbecsugar.com and can be accessed through the following link http://sbecsugar.com/wp-content/uploads/2011/07/ Material-Subsidiary-Policy.pdf

DIRECTOR'S RESPONSIBILITY STATEMENT:

Pursuant to the provisions contained in Section 134 (5) of the Companies Act, 2013, your Directors to the best of their knowledge and belief and according to information and explanations obtained from the management, confirm that:

- in the preparation of the annual accounts for the financial year ended March 31, 2015, the applicable accounting standards have been followed and there are no material departures from the same;

- 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 as at March 31, 2015 and of the loss of the Company for the year ended on that date;

- the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

- The Directors have prepared the Annual Accounts on a going concern basis.

- The Directors have laid down proper internal financial controls to be followed by the Company and such controls are adequate and operating effectively.

- the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

Shri. Santosh Chandra Gupta, expired on 03.09.2014 and Shri. G.C. Jain resigned from the Office of Director of the Company with effect from 07.04.2015, due to old age.

The Board of Directors placed on record its sincere appreciation for the valuable support and guidance given by Shri Santosh Chandra Gupta and Shri G.C. Jain to the Company during their tenure as Director of the Company.

In accordance with the provisions of Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Shri. Jayesh Modi (DIN 02849637), Non-Executive Director of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment.

Shri. Vijay Kumar Modi appointed as an additional Non-executive Director on the Board of the Company w.e.f. 06th February, 2015.

Shri. Rajeev Kumar Agarwal was appointed as an Additional Independent Director of the Company with effect from April 07, 2015 and holds Office upto the date of the forthcoming Annual General Meeting.

Shri. Jagdish Chandra Chawla and Shri. Shyam Babu Vyas was appointed as an Additional Independent Director of the Company with effect from May 27, 2015 and holds Office upto the date of the forthcoming Annual General Meeting.

Shri. Norland L.C. Suzor and Shri. Claude Philogene ceased to be the director of the Company under Section 167 of the Companies Act, 2013 w.e.f. 27th May, 2015.

Shri. N.P. Bansal who has been appointed as alternate director during the absence of Mr. Louis Claude Norland Suzor be and is hereby ceased to be the alternate director and appointed Non-executive Director on the Board of the Company w.e.f. 27th May, 2015.

As per provision of Section 149 and other applicable provisions, if any, of the Companies Act, 2013, Shri. Rajeev Kumar Agarwal, Shri. Jagdish Chandra Chawla and Shri. Shyam Babu Vyas are proposed to be appointed as Independent Directors of the Company for a period of five years commencing from September 24, 2015.

All the Independent Directors viz., Shri. Rajeev Kumar Agarwal, Shri. Jagdish Chandra Chawla and Shri. Shyam Babu Vyas have submitted declarations confirming that they meet the criteria of independence as prescribed under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.

Ms. Shwetambery Khurana has resigned from the post of Company Secretary and Compliance Officer of the Company w.e.f. 31st December, 2014 and Mr. Shobit Nehra was appointed as Company Secretary and Compliance Officer of the Company w.e.f. 07th April, 2015.

Mr. Arun Gupta has resigned from the post of Chief Financial Officer of the Company w.e.f. 06th February, 2015 and in place of him Mr. Lakhmi Chand Sharma was appointed as Chief Financial Officer of the Company w.e.f. 07th April, 2015.

The Board met Six times during the financial year 2014-15, the details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

In accordance with the provisions of Section 134 of the Act and Clause 49 of the Listing Agreement, the Board has carried out an evaluation of its own performance, the performance of Committees of the Board, namely, Audit Committee, Stakeholders Relationship Committee and Nomination and Remuneration Committee and also the directors individually. The manner in which the evaluation was carried out and the process adopted has been mentioned in the Corporate Governance Report.

The Board, on the recommendation of the Nomination & Remuneration Committee, has framed a policy for selection and appointment of Directors, Senior Management and their remuneration and also framed the criteria for determining qualifications, positive attributes and independence of directors. The Remuneration Policy is given as "Annexure –B" to this Report. The Criteria, inter alia, includes: a person to be appointed on the Board of the Company should possess in addition to the fundamental attributes of character and integrity, appropriate qualifications, skills, experience and knowledge in one or more fields of engineering, banking, management, finance, marketing and legal, a proven track record, etc.

Mr. Abhishek Modi, Whole Time Director; Mr. Shobit Nehra, Company Secretary and Mr. Lakhmi Chand Sharma, Chief Financial Officer are the Key Managerial Personnel of the Company

As required under the provisions of Section 197(14) of the Companies Act, 2013, Mr. Abhishek Modi, Whole Time Director (Designated as Executive Director) of the Company confirms that he is receiving remuneration from (SBEC Bioenergy Limited) Subsidiary of the Company.

STATEMENT ON DECLARATION GIVEN BY THE INDEPENDENT DIRECTORS

As required under Section 149 (7) of the Companies Act, 2013, all the Independent Directors have given their respective declarations that they meet the criteria of independence as specified in Section 149 (6) of the Companies Act, 2013.

AUDITORS AND AUDITORS REPORT

The Shareholders at the 20th Annual General Meeting held on September 25, 2014, have appointed M/s Doogar & Associates., as Statutory Auditors of the Company to hold Office until the conclusion of 21st Annual General Meeting subject to ratification of their appointment at every intermittent AGM. M/s Doogar & Associates., being eligible have expressed their willingness to continue as auditors of the Company and accordingly, the ratification of their appointment is recommended to the Shareholders.

Qualifications

The observation made in the Auditors' Report read together with relevant notes thereon are self-explanatory and hence, do not call for any further comments under Section 134 of the Companies Act, 2013.

Reference to the Auditors comments on non-provision for interest on late payment of cane dues, it is hereby clarified that the company has not made provision of interest on late payment of cane dues, as it is negotiating with the farmers for its waiver. In case it has to be paid, it will be accounted for in the year of payment.

Reference to the Auditors comments on physical verification of fixed assets and inventory, it is hereby clarified that the Company appointed an agency for conducting the physical verification of fixed assets and inventory. But due to continuing losses the Company could not pay the cane dues to the farmers on time due to which they agitated and disturbed the operations at plant and the management was forced to close down the pant from 20.05.2014 to 03.09.2014. Due to this reason the appointed agency could not conduct physical verification. However, from time to time management has reconciled stock of inventory as appearing in the records of bank with the records of the Company and no discrepancy was observed.

The Statutory Auditors have not reported any incident of fraud to the Audit Committee of the Company during the year under review.

COST AUDITORS

As per Section 148 of the Companies Act 2013 read with Rule 4 of the Companies (Cost Records and Audit) Rules, 2014, the cost records maintained by the Company in respect of its Sugar activity are required to be audited by a Cost Auditor. The Board of Directors, based on the recommendation of the Audit Committee, appointed M/s. M.K. Singhal & Co., Cost Accountants, as the Cost Auditors for auditing the cost accounting records maintained by the Company for the financial year 2015-16 on a remuneration of Rs.60,000/- plus service tax as applicable and reimbursement of out of pocket expenses. As required under the Companies Act, 2013, a resolution seeking member's approval of the remuneration payable to the Cost Auditor forms part of the notice convening the Annual General Meeting.

SECRETARIAL AUDITOR

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s R.K. Singhal, Company Secretaries in practice as the Secretarial Auditor to undertake the Secretarial Audit of the Company. The Report of the Secretarial Audit is given in "Annexure-C" to this Report.

The observation in secretarial audit report are self-explanatory and therefore not call for any further explanation.

Reference to the Secretarial Auditors comment that there is an undisputed liability of Water Cess of Rs. 5,62,265/- and interest of Rs. 1,59,674/- to U.P. Pollution Control Board for the year 2012-13 for which fresh demand order has been received by the Company it is hereby clarified that Reference to the Secretarial Auditors comment that there is an undisputed liability of Water Cess of Rs. 5,62,265/- and interest of Rs. 1,59,674/- to U.P. Pollution Control Board for the year 2012-13 for which fresh demand order has been received by the Company it is hereby clarified that the Company has made the payment Rs. 4,28,114 against the total demand raised by the U.P. Pollution Control Board.

RISK MANAGEMENT

Pursuant to section 134 (3) (n) of the Companies Act, 2013 & Clause 49 of the listing agreement, the Company has constituted a business risk management committee. The Risk Management Committee consisting of Shri. R.K. Agarwal (Independent Director), Shri. N.P. Bansal, Director and Shri. J.C. Chawla, Director as Members of the Committee.

After the decision of the Hon'ble Supreme Court empowering the State Government the State government to fix the Cane Price, one of the threat to the Sugar Industry except that the Committee has not identified any element of risk which may threaten the existence of the company.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate Internal Financial Controls with proper checks to ensure that transactions are properly authorised, recorded and reported apart from safeguarding its assets. These systems are reviewed and improved on a regular basis. It has a comprehensive budgetary control system to monitor revenue and expenditure against approved budget on an ongoing basis. The internal auditors of the Company reviews the controls across the key processes and submits reports periodically to the Management and significant observations are also presented to the Audit Committee for review. Follow up mechanism is in place to monitor the implementation of the various recommendations.

CORPORATE SOCIAL RESPONSIBILITY (CSR) INITIATIVES.

Section 135 of the Companies Act, 2013 provides the threshold limit for applicability of the CSR to a Company i.e. (a) net worth of the Company to be Rs. 500 crore or more; or (b) turnover of the company to be Rs. 1,000 crore or more; or (c) net Profit of the company to be Rs.5 crore or more. As the Company does not fall under any of the threshold limits given above, the provisions of Section 135 are not applicable to the Company.

RELATED PARTY TRANSACTIONS

All contracts/arrangements/transactions entered into during the financial year with the related parties were on arm's length basis and were in the ordinary course of business. Section 188(1) of the Companies Act, 2013 exempts related party transactions that are in the ordinary course of business and are on arm's length basis. However, under clause 49 of the Listing Agreement, all material Related Party Transactions requires approval of the shareholders through special resolution. Accordingly, the Company has obtained the approval of the shareholders by way of special resolution for the material related party transactions. The Board of Directors and the Audit Committee have also approved the said related party transactions.

There are no materially significant related party transactions with the promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

The policy on dealing with Related Party Transactions as approved by the Board is available at the investors section of the Company's website at www.sbecsugar.com and can be accessed through the following link http://sbecsugar.com/wp-content/uploads/2011/07/ Related-Party-Transacion-Policy.pdf.

The particulars of the material contract and arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 read with clause 49 of the Listing Agreement is disclosed separately in Form No. AOC -2 as "Annexure–D" and forms part of this report.

CORPORATE GOVERNANCE

The Report on corporate governance as stipulated under the Listing Agreement forms part of this Report. The requisite certificate confrming compliance with the conditions of corporate governance is attached to the Corporate Governance Report. The report also contains the details as required to be provided on Board evaluation, remuneration policy whistle blower policy/vigil mechanism etc.

The Whole Time Director and the Chief Financial Officer have submitted a certificate to the Board regarding the financial statements and other matters as required under the Listing Agreement.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement, form part of this Annual Report.

DISCLOSURES

Committees of the Board

During the year in accordance with the Companies Act, 2013 the Board re-constituted/re-named some of its Committees and presently the Company has the following Committees:

- Audit Committee

- Nomination and Remuneration Committee

- Stakeholders Relationship Committee

The details of all the Committees along with their composition, terms of reference and meetings held during the year are provided in the "Report on Corporate Governance" forming part of this Annual Report.

Vigil Mechanism & Whistle Blower Policy

The Company has a vigil mechanism and a whistle blower policy. The same has been posted on the Company's website and the details of the same are given in the Corporate Governance Report.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

The information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo pursuant to Section 34(3) of the Companies Act, 2013 read with Rule 8 of the Companies (Accounts) Rules, 2014 is given in "Annexure-E" to this Report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:

During the financial year 2014-15, the company has not made any investment nor given any loans or guarantees covered under the provisions of section 186 of the Companies Act, 2013.

PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197(12) read with Rule, 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 relating to ratio of the remuneration of each Director to the median employee's remuneration and other details shall be provided on request, in accordance with the provisions of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees particulars which is available for inspection by the Members at the Registered Office of the Company during business hours on working days of the Company up to the date of the ensuing Annual General Meeting. If any Member is interested in obtaining a copy thereof, such Member may write to the Company Secretary in this regard.

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, none of the employee is drawing remuneration in excess of the limits set out in the said Rules.

EXTRACT OF THE ANNUAL RETURN

The details of the extract of the Annual Return in Form MGT-9 are given in "Annexure-F" to this Report.

FIXED DEPOSITS

Fixed Deposits of Rs.6,58,25,000/- due for repayment on or before 31.03.2015 were not claimed by depositors as on that date.

Further, the net worth of the Company becomes negative, and Company does not fall the criteria stipulated under the Act, it has discontinuance acceptance and renewal of fresh/existing Fixed Deposits. Since the Company is facing a financial crunch, the Company is not in a position to repay the entire outstanding Fixed Deposits on or before as stipulated under Section 74 of the Companies Act, 2013 and for compliance of the Act, the Company has obtained expert legal opinion that since the Company is registered with BIFR and IDBI appointed as Operating Agency so, Company is not require to repay the amount of deposit till the final order of BIFR/AAIFR.

No significant or material orders were passed by the Regulators or courts or Tribunal which impact the going concern status and the Company's operations in future.

PERSONNEL RELATIONS

Your directors hereby place on record their appreciation for the services rendered by the executives, staff and workers of the Company for their hard work, dedication and commitment. During the year under review, relations between the employees and the management continued to remain cordial.

APPRECIATION

Your directors thank the various Central and State Government Authorities and Agencies for the continued help and cooperation extended by them. The Directors gratefully acknowledge all stakeholders of the Company viz., farmers, customers, members, dealers, vendors and banks for their excellent support during the year. The Directors also place on record their sincere appreciation to all employees of the Company for their unstinted commitment and continued cooperation to the Company.

For & behalf of the Board

SBEC Sugar Limited

Place: New Delhi Umesh Kumar Modi

Date: 13th August, 2015 (Chairman & President)

(DIN: 00002757)


Mar 31, 2014

Dear Members,

The Directors take pleasure in presenting the 20th Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2014.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd and M/s Modi Casings & Packaging Private Limited (Formerly known as M/s Modi Gourmet Limited) are as follows:

(Rs. in Lacs)

SBEC SUGAR LTD.

Financial Parameters Period ended Period ended 31.03.2014 31.03.2013

Sales and other income 40266.65 32068.30

Profit/(Loss) Before Interest, Depreciation & Tax (1540.81) (2258.85)

Interest and Finance Charges 2584.05 3096.65

Depreciation and Amortisation 613.14 606.33

Prior period expenses (net) 618.09 1011.52

Profit/(Loss) before Extra-Ordinary Expenses & Provision for Taxation (5356.09) (6973.35)

Exceptional Items - 6287.27

Profit/(Loss) before Tax (5356.09) (686.08)

Provision for Taxation - -

Deferred Tax Charge/ (Credit) - 372.61

Taxes for earlier years MAT credit writtern back 19.69 -

Profit/(Loss) After Tax (5375.78) (1058.69)

Transfer to Minority Interest - -

Transfer to Molasses Storage Fund 8.44 7.20

Profit/(Loss) for the period after appropriation (5384.22) (1065.89)

Earning Per Share (in Rs.) (11.28) (2.22)

(Rs. in Lacs)

CONSOLIDATED

Financial Parameters Period ended Period ended 31.03.2104 31.03.2014

Sales and other income 41169.12 33309.57

Profit/(Loss) Before Interest, Depreciation & Tax (1254.25) (1602.60)

Interest and Finance Charges 3261.12 3552.68

Depreciation and Amortisation 753.76 718.57

Prior period expenses (net) 618.15 1011.52

Profit/(Loss) before Extra-Ordinary Expenses & Provision for Taxation (5887.28) (6885.37)

Exceptional Items - (295.41)

Profit/(Loss) before Tax (5887.28) (7180.78)

Provision for Taxation - 19.88

Deferred Tax Charge/ (Credit) (158.72) 396.84

Taxes for earlier years MAT credit writtern back 19.69 -

Profit/(Loss) After Tax (5748.25) (7597.50)

Transfer to Minority Interest (167.07) 20.02

Transfer to Molasses Storage Fund 8.44 7.20

Profit/(Loss) for the period after appropriation (5589.62) (7624.72)

Earning Per Share (in Rs.) (11.71) (15.99)

OPERATIONS

The cane crushing for the period under review was 91.23 Lacs quintals in 138 days with an average crushing rate of 66109 quintals per day as against 92.38 Lacs quintals in 134 days with an average crushing rate of 68943 quintals per day for the previous period. The sugar recovery has slightly increased to 8.76 % as against 8.67% in the previous period.

The market sentiments for sugar during the financial year remained bearish owing to the continued mismatch between supply and demand of sugar, affecting sales realization. Further during the year UP Government has announced very high cane price which has resulted in the Loss before extraordinary expenses and provision for taxation to Rs. 5356.09 Lacs against the Loss of Rs. 6973.35 lacs last year.

Due to continuing losses the company could not pay the cane dues to the farmers on time due to which they agitated and disturbed the operations at plant and the management was forced to close down the plant from 8th July,2013 to 2nd August,2013, which affected the administration, repair & maintenance work of the plant during the year under review.

During the current year also losses are further piled up and cane dues to farmers are overdue.

On the basis of annual audited accounts of the company as at 31st March, 2013, the Board of Directors formed an opinion that the net worth of the company as at 31st March,2013 has been fully eroded. The company in terms of Board of Director''s resolution dated 6th July 2013 has filed a reference with the Board for Industrial and financial Reconstruction (BIFR) U/S 15(1) of the Sick Industrial companies (Special provisions) Act 1985 (SICA) vide its letter dated 24th July 2013 and as per communication received from BIFR vide its letter No. 3/(S-22)/BC/2013 dated 21st August 2013, The said reference has been registered by BIFR as case No. 58/2013. The BIFR has declared the company as Sick u/s 3(1)(0) of SICA and appointed IDBI as operating agency u/s 17(3) of the Act. in its hearing held on dated 04.02.2014.

FIXED DEPOSITS

During the period under review, the Company did not accepted/renewed any fixed deposits. The total amount of fixed deposit held as on 31st March 2013 was Rs. 134.25 Lacs . However, as on 31st March, 2014, Rs. 549 lacs amount of fixed deposit is matured but not yet claimed by the deposit holder.

DIRECTORS

Mrs. Kumkum Modi (DIN 00522904), Non Executive Director of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer herself for re-appointment.

Mr. Santosh Chandra Gupta ceased to be the Whole-time Director (Works) of the Company effective June 17, 2014 and is now a Non- Executive Director of the Company, with effect from June 18, 2014.

In accordance with the provisions of Section 149 of the Companies Act, 2013 and the Rules made there under, which came into effect from April 1,2014, approval of the Members will be sought at the ensuing Annual General Meeting of the Company for formalizing the appointment of Mr. G. C. Jain, Mr. Om Prakash Modi, Mr. Philogene Claude, Mr. Manmohan, Mr. Norland L. C. Suzor, Directors of the Company as an Independent Director of the Company not liable to retire by rotation, for a term of five consecutive years commencing from 25th September, 2014.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

The Company have three Subsidiary Companies, namely SBEC Bio-energy Limited, SBEC Stockholding & Investment Limited and M/s Modi Casings & Packaging Private Limited (Formerly known as M/s Modi Gourmet Limited). The Statement under Section 212 of the Companies Act, 1956 in respect of Subsidiary Companies is separately annexed.

In accordance with the General Circular No. 2/2011 dated 8th February, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Board of Directors has decided not to annex the annual accounts of the two Subsidiary Companies i.e SBEC Bioenergy Limited, SBEC Stockholding & Investment Limited and Modi Casings & Packaging Private Limited (Formerly known as Modi Gourmet Limited) in this Annual Report. The annual accounts of these Subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and the Subsidiary Companies seeking such information at any point of time. The annual accounts of these Subsidiary Companies shall also be kept for inspection by any shareholder at the registered office of the Company and of the Subsidiary Companies concerned. The Company shall furnish a hard copy of details of account of these Subsidiary Companies to any shareholder on demand.

AUDITORS

M/s Doogar and Associates, Chartered Accountants, (Firm Registration No.000561N), who are Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible and recommended for reappointment. Certificate from the Auditors has been received to the effect that their re appointment, if made, would be within the limits prescribed under Section 139 of the Companies Act, 2013 & that they are not disqualified for such appointment within the meaning of section 141 of the comapnies Act, 2013.

COST AUDITOR

Pursuant to the order of the Central Government under the provisions of Section 233B of the Companies Act, 1956, your company had appointed M/s. M.K. Singhal & Co., Cost Accountants, as cost auditors of the company, with the approval of Central Government.

ACCOUNTS AND AUDITORS'' REPORT

Reference to the Auditors comment on financial statement being prepared on going concern basis, the comments are self explanatory and need no further comments.

Reference to the Auditors comments on non provision for interest on late payment of cane dues, it is hereby clarified that the company has not made provision of interest on late payment of cane dues, as it is negotiating with the farmers for its waiver. In case it has to be paid, it will be accounted for in the year of payment.

Reference to the Auditors comments on physical verification of fixed assets and inventory, it is hereby clarified that the entire inventory Fixed Assets was under the lock and key of U. P. Co-operative bank Limited as the company defaulted in repayment of cane dues and the physical takeover of the inventory was not permissible. However, from time to time management has reconciled stock of inventory as appearing in the records of bank with the records of the Company and no discrepancy was observed.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217 (2AA) of Companies Act, 1956, the Directors of your company declare as under:

I. That in the preparation of the Annual Accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

II. That the Company has selected such accounting policies and applied them consistently, except as specified in Notes to Accounts which are self explanatory 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 loss of the company for that year;

III. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding the assets of the company and preventing and detecting fraud and other irregularities;

IV. That the Annual Accounts are prepared on going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, Report on Corporate Governance, a Management Discussion and Analysis Statement , Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is included in the said Corporate Governance Report.

LISTING OF SECURITIES

The equity shares of your Company are listed on the Bombay Stock Exchange Limited and The Calcutta Stock Exchange Association Limited. The Company''s application for delisting of shares with The Calcutta Stock Exchange Association Limited is still pending.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As stipulated under the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988, Annexure containing the particulars is annexed hereto which forms a part of this report

PARTICULARS OF EMPLOYEES

None of the employees of the company were in receipt of remuneration of more than limit prescribed under section 217 (2A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their appreciation and gratitude to the farmers and to the Co-operative Cane Societies for their invaluable support. Your Directors also take this opportunity to express their appreciation and gratitude to Government Agencies, Shareholders, Business Associates, Employees, Suppliers and Bankers of the Company for their help and support continuously extended to the Company.

For & behalf of the Board for SBEC Sugar Limited

Place: New Delhi Umesh Kumar Modi Date: 23rd August,2014 (Chairman & President)


Mar 31, 2013

Dear Shareholders,

The Directors take pleasure in presenting the 19th Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2013.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd and M/s Modi Gourmet Limited are as follows:

(Rs. in Lacs)

SBEC SUGAR LTD. CONSOLIDATED

Financial Parameters Period ended Period ended Period ended Period ended 31.03.2013 31.03.2012 31.03.2013 31.03.2012

Sales and other income 32068.30 32017.97 33309.57 33366.43

Profit/(Loss) Before Interest, Depreciation & Tax (2258.85) 925.22 (1602.60) 1753.39

Interest and Finance Charges 3096.65 2198.28 3552.68 2680.49

Depreciation and Amortisation 606.33 748.79 718.57 843.21

Prior period expenses (net) 1011.52 11.68 1011.52 11.68

Profit/(Loss) before Extra- Ordinary Expenses &

Provision for Taxation (6973.35) (2033.53) (6885.37) (1781.99)

Exceptional Items 6287.27 (1483.32) (295.41) (1483.32)

Profit/(Loss) before Tax (686.08) (3516.85) (7180.78) (3265.31)

Provision for Taxation - - 19.88 48.52

Deferred Tax Charge/ (Credit) 372.61 - 396.84 80.32

Profit/(Loss) After Tax (1058.69) (3516.85) (7597.50) (3394.15)

Transfer to Minority Interest - - 20.02 1140.31

Transfer to Molasses Storage Fund 7.20 7.22 7.20 7.22

Profit/(Loss) for the period after appropriation (1065.89) (3524.07) (7624.72) (4541.68)

Earning Per Share (in Rs.) (2.22) (7.38) (15.99) (9.51)

OPERATIONS

The cane crushing for the period under review was 92.38 Lacs quintals in 134 days with an average crushing rate of 68943 quintals per day as against 99.35 Lacs quintals in 151 days with an average crushing rate of 65798 quintals per day for the previous period. The sugar recovery has slightly increased to 8.67 % as against 8.23% in the previous period.

For the sugar season 2011-12, the Government of U.P had increased the cane price as compared to last sugar season and the sugar market sentiments remained bearish throughtout the year. Due to resulting financial losses the company was not able to meet its cane price obligation to farmers in time. The farmers resorted to agitation and disturbed the operation of the company. Fearing damage to person and property management was forced to close down the plant from July,2012 to October,2012, which affected the administration, repair & maintenance work of the plant during the year under review.

For the Sugar season 2012-13 the Government of U.P further increased the cane price and demand for sugar and its prices remained sluggish. The farmers again resorted to agitation and workers also resorted to illegal strike. For the safety of person and property management left with no option but to declare a lockout in the plant w.e.f 8th July,2013 which was lifted by the management on 2nd August,2013 pursuant to the negotiation and settlement arrived at before the Dy. Labour Commissioner, Meerut.

On the basis of annual audited accounts of the company as at 31st March,2013, the Board of Directors formed an opinion that the net worth of the company as at 31st March,2013 has been fully eroded and that the company has become a sick industrial company as defined under Section 3(1)(o) of the Sick Industrial Companies (Special Provisions) Act, 1985.The Board of Directors decided that a reference will be made with the Hon''ble Board for Industrial and Financial Reconstruction (BIFR) to seek determination of measures which would be adopted as required under Section 15(1) and other applicable provisions of the Sick Industrial Companies (Special Provisions) Act,1985 (SICA).

FIXED DEPOSITS

During the period under review, the Company accepted/renewed deposits to the extent of Rs. 319 Lacs. The total amount of fixed deposit held as on 31st March 2013 was Rs. 466.25 Lacs . However, Rs. 417 lacs amount of fixed deposit is matured but not yet claimed by the deposit holders.

DIRECTORS

In accordance with the provisions of Section 256 of the Companies Act, 1956 and Article 125 of the Articles of Association of the Company, Mr. Gulab Chand Jain, Non Executive Independent Director and Mr. Jayesh Modi, Non Executive Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

The Company have three Subsidiary Companies, namely SBEC Bio-energy Limited, SBEC Stockholding & Investment Limited and Modi Gourmet Limited. The audited statement of accounts alongwith the report of the Board of Directors , Auditor''s Report and statement thereon for the year ended 31st March,2013 of SBEC Bio-energy Limited is annexed. The Statement under Section 212 of the Companies Act,1956 in respect of Subsidiary Companies is separately annexed.

In accordance with the General Circular No. 2/2011 dated 8th Februaury, 2011 issued by the Ministry of Corporate Affairs , Government of India, the Board of Directors has decided not to annex the annual accounts of the two Subsidiary Companies i.e SBEC Stockholding & Investment Limited and Modi Gourmet Limited in this Annual Report. The annual accounts of these two Subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and the Subsidiary Companies seeking such information at any point of time. The annual accounts of these two Subsidiary Companies shall also be kept for inspection by any shareholder at the registered office of the Company and of the Subsidiary Companies concerned. The Company shall furnish a hard copy of details of account of these two Subsidiary Companies to any shareholder on demand.

AUDITORS

M/s Doogar and Associates, Chartered Accountants, (Firm Registration No.000561N), who are Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment.

COST AUDITOR

Pursuant to the order of the Central Government under the provisions of Section 233B of the Companies Act, 1956, your company had appointed M/s. M.K. Singhal & Co., Cost Accountants, as cost auditors of the company, with the approval of Central Government.

ACCOUNTS AND AUDITORS'' REPORT

Reference to the Auditors comment on financial statement being prepared on going concern basis, the comments are self explanatory and need no further comments.

Reference to the Auditors comments on non provision for interest on late payment of cane dues, it is hereby clarified that the company has not made provision of interest on late payment of cane dues, as it is negotiating with the farmers for its waiver. In case it has to be paid, it will be accounted for in the year of payment.

Reference to the Auditors comments on physical verification of fixed assets and inventory, it is hereby clarified that the physical verification of fixed assets and inventory is being taken during off season. However, during the off season falling in the financial year 2012-2013, physical verification could not be undertaken due to farmer''s agitation from July 2012 to October,2012.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217 (2AA) of Companies Act, 1956, the Directors of your company declare as under:

I. That in the preparation of the Annual Accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

II. That the Company has selected such accounting policies and applied them consistently, except as specified in Notes to Accounts which are self explanatory 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 loss of the company for that year;

III. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding the assets of the company and preventing and detecting fraud and other irregularities;

IV. That the Annual Accounts are prepared on going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, Report on Corporate Governance, a Management Discussion and Analysis Statement , Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is included in the said Corporate Governance Report.

LISTING OF SECURITIES

The equity shares of your Company are listed on the Bombay Stock Exchange Limited and The Calcutta Stock Exchange Association Limited. The Company''s application for delisting of shares with The Calcutta Stock Exchange Association Limited is still pending.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As stipulated under the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988, Annexure containing the particulars is annexed hereto which forms a part of this report

PARTICULARS OF EMPLOYEES

None of the employees of the company were in receipt of remuneration of more than limit prescribed under section 217 (2A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their appreciation and gratitude to the farmers and to the Co-operative Cane Societies for their invaluable support. Your Directors also take this opportunity to express their appreciation and gratitude to Government Agencies, Shareholders, Business Associates, Employees, Suppliers and Bankers of the Company for their help and support continuously extended to the Company.



For & on behalf of the Board For SBEC Sugar Ltd.

Place : New Delhi Umesh Kumar Modi

Date : 8th August, 2013 (Chairman & President)


Mar 31, 2012

Dear Shareholders,

The Directors take pleasure in presenting the 18th Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2012.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd and M/s Modi Gourmet Limited are as follows:

(Rs. in Lacs)

SBEC SUGAR LTD. CONSOLIDATED

Financial Parameters Period ended Period ended Period ended Period ended 31.03.2012 31.03.2011 31.03.2012 31.03.2011

Sales and other income 32017.97 32681.53 33366.43 33814.84

Profit/(Loss) Before Interest, Depreciation & Tax 925.22 828.36 1753.39 1453.88

Interest and Finance Charges 2198.28 1567.02 2680.49 1891.08

Depreciation and Amortisation 748.79 532.51 843.21 737.29

Prior period expenses (net) 11.68 8.77 11.68 8.77

Profit/(Loss) before Extra- Ordinary Expenses & Provision for Taxation (2033.53) (1279.94) (1781.99) (1183.26)

Exceptional Items (1483.32) 1312.21 (1483.32) 1312.21

Profit/(Loss) before Tax (3516.85) 32.27 (3265.31) 128.95

Provision for Taxation - 0.39 48.52 16.36

Deferred Tax Charge/ (Credit) - (338.67) 80.32 (284.90)

Profit/(Loss) After Tax (3516.85) 370.55 (3394.15) 397.49

Transfer to Minority Interest - - 1140.31 -

Transfer to Molasses Storage Fund 7.22 7.80 7.22 7.80

Profit/(Loss) for the period after appropriation (3524.07) 362.75 (4541.68) 389.69

Earning Per Share (in Rs.) (7.38) 0.78 (9.51) 0.83

OPERATIONS

The cane crushing for the period under review was 99.35 Lacs quintals in 151 days with an average crushing rate of 65798 quintals per day as against 93.60 Lacs quintals in 143 days with an average crushing rate of 65455 quintals per day for the previous period. The sugar recovery has slightly reduced to 8.23 % as against 8.63% in the previous period due to heavy rainfall resulting in water logging in fields and also affected from insect & disease i.e. White Grub, grassy shoot borar etc.

The market sentiments during the financial year remained bearish owing to the continued mismatch between supply and demand of sugar, affecting sales realization. Further during the year UP Government has announced very high cane price which has resulted in the Loss after tax to Rs.3516.85 Lacs against the profit after tax of Rs. 370.55 lacs last year.

FIXED DEPOSITS

During the period under review, the Company accepted/renewed deposits to the extent of Rs. 952.25 Lacs. The total amount of fixed deposit held as on 31st March 2012 was Rs. 958.75 Lacs.

DIRECTORS

In accordance with the provisions of Section 256 of the Companies Act, 1956 and Article 125 of the Articles of Association of the Company, Mrs. Kum Kum Modi, Non Executive Director and Mr. Man Mohan, Non Executive Independent Director of the ompany, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

The Company have three Subsidiary Companies, namely SBEC Bio-energy Limited, SBEC Stockholding & Investment Limited and Modi Gourmet Limited. The audited statement of accounts alongwith the report of the Board of Directors, Auditor''s Report and statement thereon for the year ended 31st March,2012 of SBEC Bio-energy Limited is annexed. The Statement under section 212 of the Companies Act,1956 in respect of Subsidiary Companies is separately annexed.

In accordance with the General Circular No. 2/2011 dated 8th Februaury, 2011 issued by the Ministry of Corporate Affairs , Government of India, the Board of Directors has decided not to annex the annual accounts of the two Subsidiary Companies i.e SBEC Stockholding & Investment Limited and Modi Gourmet Limited in this Annual Report. The annual accounts of these two Subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and the Subsidiary Companies seeking such information at any point of time. The annual accounts of these two Subsidiary Companies shall also be kept for inspection by any shareholder at the registered office of the Company and of the Subsidiary Companies concerned. The Company shall furnish a hard copy of details of account of these two Subsidiary Companies to any shareholder on demand.

AUDITORS

M/s Doogar and Associates, Chartered Accountants, (Firm Registration No.000561N), who are Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment.

COST AUDITOR

Pursuant to the order of the Central Government under the provisions of Section 233B of the Companies Act, 1956, your company had appointed M/s. M.K. Singhal & Co., Cost Accountants, as cost auditors of the company, with the approval of Central Government. ACCOUNTS AND AUDITORS'' REPORT

Reference to deviation from AS-1, It is clarified that in view of the uncertanity of dispatch of levy sugar, the management has decided to accounting for the same based on dispatch, while in the earlier year the same was done on the basis of receipt of release order from the Government of India.

Reference to the Auditors comments relating to the deviation from the AS-2: Valuation of Inventories, it is hereby clarified that the management decided to value the stock of free sugar as on 31st March, 2012 at cost price for the year 2011-12 in lieu of the average market price prevailing during the year in view of continuous increase in market price thereafter. (Refer Note No. 35 of Notes to Account).

Reference to the Auditors comments relating to non provision of liability regarding differential amount of custom duty under EPCG scheme, the company has prayed with the Deputy Commissioner of Customs, Bond Section, Mumbai for rectifying errors and anomalies in the computation of the demand. Pending hearing with the Authority, the liability has not been provided and shown as contingent liability.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217 (2AA) of Companies Act, 1956, the Directors of your company declare as under:

I. That in the preparation of the Annual Accounts, the applicable accounting standards except that for deviations from AS -1 and AS -2 , had been followed alongwith proper explanation relating to material departures;

II. That the Company has selected such accounting policies and applied them consistently, except as specified in Notes to Accounts which are self explanatory 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 loss of the company for that year;

III. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding the assets of the company and preventing and detecting fraud and other irregularities;

IV. That the Annual Accounts are prepared on going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, Report on Corporate Governance, a Management Discussion and Analysis Statement , Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is included in the said Corporate Governance Report.

LISTING OF SECURITIES

The equity shares of your Company are listed on the Bombay Stock Exchange Limited, and The Calcutta Stock Exchange Association Limited. The Company''s application for delisting of shares with The Calcutta Stock Exchange Association Limited is still pending.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As stipulated under the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988, Annexure containing the particulars is annexed hereto which forms a part of this report PARTICULARS OF EMPLOYEES

None of the employees of the company were in receipt of remuneration of more than limit prescribed under section 217 (2A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their appreciation and gratitude to the farmers and to the Co-operative Cane Societies for their invaluable support. Your Directors also take this opportunity to express their appreciation and gratitude to Government Agencies, Shareholders, Business Associates, Employees, Suppliers and Bankers of the Company for their help and support continuously extended to the Company.

For & behalf of the Board

for SBEC Sugar Limited

Place: New Delhi Umesh Kumar Modi

Date: 12th November, 2012 (Chairman & President)


Mar 31, 2011

Dear Shareholders,

The Directors take pleasure in presenting the 17th Annual Report of the Company together with the Audited Accounts for the year ended 31st March 2011.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd and M/s Modi Gourmet Limited are as follows:

(Rs. in Lacs)

SBEC SUGAR LTD.

Financial Parameters Period ended Period ended 31.03.2011 31.03.2010 (12 months) (9 months)

Sales and other income 32681.53 17366.61

Profit/(Loss) Before Interest, Depreciation & Tax 860.43 2211.06

Interest and Finance Charges 1598.76 944.43

Depreciation and Amortisation 532.51 392.00

Prior period expenses (net) 8.77 110.45

Profit/(Loss) before Extra- (1279.61) 764.18 Ordinary Expenses & Provision for Taxation

Exceptional Items (reversal 1312.21 — of interest relating to earlier years )

Profit/(Loss) before Tax 32.60 764.18

Provision for Taxation 0.73 0.40

Deferred Tax Charge/ (Credit) (338.68) 270.12

Profit/(Loss) After Tax 370.55 493.66 Transfer from Molasses Storage Fund — —

Transfer to Molasses Storage Fund 7.80 4.44

Profit/(Loss) for the period after appropriation 362.75 489.22

Earning Per Share 0.78 1.04



CONSOLIDATED Financial Parameters Period ended Period ended 31.03.2011 31.03.2010 (12 months) (9 months)

Sales and other income 33817.03 18260.06

Profit/(Loss) Before Interest, Depreciation & Tax 1488.63 2709.00

Interest and Finance Charges 1923.30 1011.07

Depreciation and Amortisation 737.29 715.19

Prior period expenses (net) 8.77 110.54

Profit/(Loss) before Extra- (1180.73) 872.20 Ordinary Expenses & Provision for Taxation

Exceptional Items (reversal 1312.21 — of interest relating to earlier years )

Profit/(Loss) before Tax 131.48 872.20

Provision for Taxation 18.91 32.47

Deferred Tax Charge/ (Credit) (284.90) 281.49

Profit/(Loss) After Tax 397.47 558.24 Transfer from Molasses Storage Fund — —

Transfer to Molasses Storage Fund 7.80 4.44

Profit/(Loss) for the period after appropriation 389.67 553.80

Earning Per Share 0.83 1.17

The financial results for the year ended 31.03.2011 are for a period of 12 months, and for the previous period ended on 31.03.2010 were for a period of 9 months, and therefore are not comparable.

OPERATIONS

The cane crushing for the period under review was 93.60 Lacs quintals in 143 days with an average crushing rate of 65455 quintals per day as against 87.20 Lacs quintals in 122 days with an average crushing rate of 71475 quintals per day for the previous period. The sugar recovery has slightly reduced to 8.63 % as against 8.92% in the previous period.

The market sentiments in the beginning of crushing season remained bearish due to decreasing in sales realisation and recovery as well, has resulted decrease in the profit after tax to Rs. 370.55 Lacs and consolidated to Rs. 397.47 Lacs.

FIXED DEPOSITS

During the period under review, the Company accepted/renewed deposits to the extent of Rs. 798.50 Lacs. The total amount of fixed deposit held as on 31st March 2011 was Rs. 964.75 Lacs.

DIRECTORS

In accordance with the provisions of Section 256 of the Companies Act, 1956 and Article 125 of the Articles of Association of the Company, Mr. Claude Philogene, Non Executive Independent Director and Mr. O.P. Modi , Non Executive Independent Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

SUBSIDIARY COMPANIES AND CONSOLIDATED ACCOUNTS

Pursuant to section 212 of the Companies Act, 1956, audited statement of accounts alongwith the report of the Board of Directors of the Subsidiary Companies, namely SBEC Bioenergy Limited, SBEC Stockholding & Investment Limited and Modi Gourmet Limited and the respective Auditors' Report thereon for the year ended 31st March 2011 and a statement thereon are annexed.

AUDITORS

M/s Doogar and Associates, Chartered Accountants, (Firm Registration No.000561N), who are Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment.

COST AUDITORS

M/s. M.K.Singhal & Company Cost Accountants, has been appointed by the Board of Directors of the Company on the recommendation of the Audit Committee, as Cost Auditors of the Company for the Financial Year 2011-12. The Company has received a letter from them to the effect that their appointment, if made would be within the prescribed limits under Section 224 (1B) of the Company Act, 1956, Certificate of independence and arms length relationship with the Company and are not disqualified for such appointment within the meaning of Sectio 226/233-B(5) of the Companies Act, 1956. Accordingly, the approval of the Central Government for the appointment of Cost Auditors has been received.

ACCOUNTS AND AUDITORS' REPORT

Reference to the Auditors comments relating to the deviation from the AS-2 : Valuation of Inventories, it is hereby clarified that the management decided to value the stock of free sugar as on 31.03.2011 at average market price prevailing during sugar season 2010-2011 in lieu of the cost price so as to show realistic profits of this period. This was necessitated because of the vide variation in the cost and market price of sugar as was prevalent during this period and further on account of the difference in the accounting year of the Company which does not correspond with the seasonal cycle of the sugar Industry.

The Company has duly mentioned the reasons for such deviation in schedule 14 Note no. B 6 of the Notes to account in compliance with the requirements of the Statute.

DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 217

Pursuant to the requirement under section 217 (2AA) of Companies Act, 1956, the Directors of your company declare as under:

I. That in the preparation of the Annual Accounts, the applicable accounting standards except that for deviations from accounting standard 2 , had been followed alongwith proper explanation relating to material departures;

II. That the Company has 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 of the company for that year;

III. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding the assets of the company and preventing and detecting fraud and other irregularities;

IV. That the Annual Accounts are prepared on going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, Report on Corporate Governance, a Management Discussion and Analysis Statement , Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is included in the said Corporate Governance Report.

LISTING OF SECURITIES

The equity shares of your Company are listed on The Bombay Stock Exchange Limited, and The Calcutta Stock Exchange Association Limited. The Company's application for delisting of shares with The Calcutta Stock Exchange Association Limited is still pending.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As stipulated under the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the Report of the Board of Directors) Rules 1988, Annexure containing the particulars is annexed hereto which forms a part of this report

PARTICULARS OF EMPLOYEES

None of the employee of the company were in receipt of remuneration of more than limit prescribed under section 217 (2 A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their appreciation and gratitude to the farmers and to the co-operative cane societies for their invaluable support. Your Directors also take this opportunity to express their appreciation and gratitude to Government Agencies, Shareholders, Business Associates, Employees, Suppliers and Bankers of the Company for their help and support continuously extended to the Company.

For & on behalf of the Board For SBEC Sugar Ltd.

Umesh Kumar Modi (Chairman & President)

Place : New Delhi Date : 11th August, 2011


Mar 31, 2010

The Directors take pleasure in presenting the 16th Annual Report of the Company together with the Audited Accounts for the period ended 31st March 2010.

FINANCIAL RESULTS

The summarised financial results of SBEC Sugar Ltd. as well as Consolidated with its subsidiaries i.e. M/s. SBEC Bioenergy Ltd., M/s. SBEC Stockholding and Investment Ltd and M/s Modi Gourmet Limited are as follows:

(Rs. in Lacs) SBEC SUGAR LTD. CONSOLIDATED

Financial Parameters Period ended Period ended Period ended Period ended 31.03.2010 30.06.2009 31.03. 2010 30.06.2009 (9 months) (15 months) (9 months) (15 months)

Sales and other income 17366.61 31021.11 18260.06 33079.92

Profit/(Loss) Before Interest, Depreciation & Tax 2211.06 2888.55 2709.00 4297.02

Interest and Finance Charges 944.43 1555.06 1011.07 1813.44

Depreciation and Amortisation 392.00 648.65 715.19 1226.53

Prior period expenses (net) 110.45 6.84 110.54 6.84

Profit/(Loss) before Extra- Ordinary Expenses & Provision for Taxation 764.18 678.00 872.20 1250.21

Extra-Ordinary Expenses -- -- -- --

Profit/(Loss) before Tax 764.18 678.00 872.20 1250.21

Fringe Benefit Tax -- 13.27 -- 15.27

Provision for Taxation 0.40 0.23 32.47 42.48

Deferred Tax Charge/(Credit) 270.12 (35.66) 281.49 2.67

Profit/(Loss) After Tax 493.66 700.16 558.24 1189.79

Transfer from Molasses Storage Fund -- 13.00 -- 13.00

Transfer to Molasses Storage Fund 4.44 9.03 4.44 9.03

Profit/(Loss) for the period after appropriation 489.22 704.13 553.80 1193.76

Earning Per Share 1.04 1.47 1.17 2.50

The financial results for the period ended 31.03.2010 are for a period of 9 months, and for the previous year ended on 30.06.2009 were for a period of 15 months, and therefore are not comparable.

OPERATIONS

The cane crushing for the period under review was 87.20 lakhs quintals in 122 days with an average crushing rate of 71475 quintals per day as against 101.15 lakhs quintals in 150 days with an average crushing rate of 67435 quintals per day for the previous period. The sugar recovery has slightly improved to 8.92 % as against 8.77% in the previous period.

The market sentiments in the beginning of crushing season remained bullish due to mismatch between supply and demand of sugar, improving sales realisation positively coupling with increasing in recovery has resulted in profit after tax Rs. 493.66 Lacs and consolidated Rs. 558.24 Lacs.

FIXED DEPOSITS

During the period under review, the Company accepted deposits to the extent of Rs. 438 lakhs. The total amount of fixed deposit held as on 31st March 2010 was Rs. 781.75 lakhs and there were two deposits lying unclaimed as on that date .

DIRECTORS

Mr Jayesh Modi was appointed as an additional director of the company with effect from 18.06.2010.

Mr. Santosh Chand Gupta was appointed as an addtinal director of the Company w.e.f 18.06.2010. He was also appointed Whole Time Director (Works) of the Company subject to your approval for a period of one year with effect from that date .

Notices in writing alongwith requisite deposits under section 257 of the Companies Act 1956, have been received from the members of the Company proposing Mr. Jayesh Modi and Mr. Santosh Chand Gupta as candidates for the office of Directors.

In accordance with the provisions of Section 256 of the Companies Act, 1956 and Article 125 of the Articles of Association of the Company, Mr. GC.Jain , Non Executive Independent Director and Mr. Norland L.C. Suzor,, Non-Executive Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment.

SUBSIDIARY COMPANY AND CONSOLIDATED ACCOUNTS

Pursuant to section 212 of the Companies Act, 1956, audited statement of accounts alongwith the report of the Board of Directors of the Subsidiary Companies, namely SBEC Bioenergy Limited, SBEC Stockholding & Investment Limited and Modi Gourmet Limited and the respective Auditors Report thereon for the year ended 31st March 2010 and a statement thereon are annexed.

AUDITORS

M/s Doogar and Associates, Chartered Accountants, (Firm Registration No.000561N), who are Statutory Auditors of the Company, retire at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment.

ACCOUNTS AND AUDITORS REPORT

The Notes to the accounts referred to in the Auditorsreport are self explanatory and, therefore, do not call for any further comments.

DIRECTORS RESPONSIBILITY STATEMENT UNDER SECTION 217

Pursuant to the requirement under section 217 (2AA) of Companies Act, 1956, the Directors of your company declare as under:

I. That in the preparation of the Annual Accounts, the applicable accounting standards had been followed alongwith proper explanation relating to material departures;

II. That the Company has 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 of the company for that year;

III. That proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act for safe guarding the assets of the company and preventing and detecting fraud and other irregularities;

IV. That the Annual Accounts are prepared on going concern basis.

CORPORATE GOVERNANCE

As per clause 49 of the Listing Agreement with the Stock Exchange, Report on Corporate Governance, a Management Discussion and Analysis Statement, Certificate from the Auditors of the Company confirming compliance with the conditions of Corporate Governance is included in the said Corporate Governance Report.

SECRETARIAL AUDIT

As per the direction of the Securities and Exchange Board of India, the Secretarial Audit of the Company is being conducted on quarterly basis by a Practicing Company Secretary. The Secretarial Audit Report confirms that the Company has complied with all the applicable provisions of the Companies Act, 1956, Listing Agreement with the Stock Exchanges, and all the Regulations of Securities and Exchange Board of India (SEBI) as applicable to the Company.

LISTING OF SECURITIES

The equity shares of your Company are listed on The Bombay Stock Exchange Limited, and The Calcutta Stock Exchange Limited. The Companys application for delisting of shares with The Calcutta Stock Exchange Limited is still pending. ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

As stipulated under the provisions of Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules 1988, Annexure containing the particulars is annexed hereto which forms a part of this report

PARTICULARS OF EMPLOYEES

Information required under section 217 (2A) of the Companies Act 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended from time to time:-

During the period under review, there was one employee who was in receipt of remuneration more than the limit prescribed under section 217 (2A) of the Companies (Particulars of Employees) Rules, 1975 as amended.

ACKNOWLEDGEMENTS

Your Directors take this opportunity to express their appreciation and gratitude to the farmers and to the co-operative cane societies for their invaluable support. Your Directors also take this opportunity to express their appreciation and gratitude to Government Agencies, Shareholders, Business Associates, Employees, Suppliers and Bankers of the Company for their help and support continuously extended to the Company.

For & on behalf of the Board For SBEC-Sugar Ltd.

Place : New Delhi Umesh Kumar Modi

Date : 25th August, 2010 (Chairman & President)

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