Directors Report of Jainex Aamcol Ltd.

Mar 31, 2014

TO THE SHAREHOLDERS

The Directors present their Annual Report together with Audited Accounts of the company fortheyear ended 31st March, 2014

FINANCE AND ACCOUNTS

2014 2013 Rs in lacs Rs in lacs

a) Revenue from operations 1232.08 1249.63

b) Other Income 0.34 8.19

1232.41 1257.82

Operating Profit (loss) before Extraordinary items and Tax 66.00 130.67

Less: Depreciation amortiztion 138.65 151.61

Less: Extraordinary items (67.48) 0

Less: Provision for Income Tax (net) 0 0

Add/Less: Deferred Tax (credit) (1.10) (7.86)

Profit for the year after tax (4.07) (13.08)

Add: Profit b/f from previous year (2.09) 10.99

Balance carried to Balance Sheet (6.16) (2.09)

Your Directors have to inform that the due to continuing slow down in automotive industry, the turnover of the company was marginally reduced over the previous year from Rs. 1249.63 lacs to Rs. 1232.08 lacs. However exports have increased by 58% to Rs 314.76 lacs. The EBITDA for the year under review taking into consideration of extra ordinary items of prior period receipts/increase in salaries, etc.; is Rs.266.43 lacs as against Rs. 269.36 lacs in previous year. The Company is trying to offset the adverse impact of the demand recession in India by increasing the exports.

In view of slowdown in Automotive Industry which consists of 70% of company''s turnover and looking to the current trend in the sector, the company has made an application to its bankers, Bank of India, for re- schedulement of future installments of term loans due to negative working results and inadequate cash flows to meet and honour the current and future burden of installments which are higher from current year and the past years. The proposal is under consideration by the Bank.

AUDITORS

Messrs. R. A. Singh & Associates, Chartered Accountants, Mumbai, FRN 110271W the retiring auditors are eligible for re-appointment. The Company has received letters from them to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141{3)(g) of the Companies Act, 2013 and that they are not disqualified for re-appointment. The Notes on Financial Statements referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.

COST AUDITORS

The Company has appointed M. R. Pandit & Co., Cost auditors for conducting the audit of cost records of the Company for the financial year 2013-14:

DIRECTORS

Shri Kunal S. Bafna was appointed as Whole time Director w.e.f. 10th October, 2013, subject to approval of shareholders. The necessary resolutions for your approval to the appointment of Shri Kunal S. Bafna as Whole time Director of the company have been included in the notice to the ensuing Annual General meeting. The Directors commend his appointment

Shri R. Mazumdar, Managing Director of the company ceases to be Managing Director w.e.f. 01.04.2014 due to his incapacity and continuing major illness from 17.02.2014 and therefore he is deemed to have vacated the office of Managing Director. The Board appreciates for his long association and tenure with the company of over four decades during which he has worked tirelessly for the company, improved its performance over the years and has successfully implemented various modernization/expansion plans of the company. The Board wishes him all the best in speedy recovery of his health.

Shri Mohan Z. Kothari, Jt.Managing Director has been appointed as Managing Director for the balance term of 2 years w.e.f. 1st April 2014 by the Board of Directors on the same terms and conditions as approved by the Board and shareholders in the last AGM save and except the cha nge in designation as Managing Director in view of

Shri R. Mazumdar ceasing to be Managing Director. The notice convening the Annual General Meeting includes the proposal/terms for his appointment and payment of remuneration as Managing Director. The Directors recommend his appointment.

EMPLOYEE RELATIONS

Your Directors would also like to place on record their appreciation for the services rendered by all categories of the company''s employees.

BANKER

Your Directors would like to place on record their appreciation for the pro-active support and assistance given by the banker, Bank of India and look forward to receive their continued support and assistance.

DIRECTORS'' RESPONSIBILITY STATEMENT

The company is in compliance with various accounting and financial reporting requirements in respect of the financial statements for the year under review. Pursuant to Section 217 (2AA) of the Companies Act, 1956, and in respect of the annual accounts for the year under review, the Directors hereby confirm that:

a) In preparation of annual accounts, the applicable accounting standards have been followed save and except those mentioned in the Notes forming part of Accounts.

b) They have in the selection of the accounting policies, consulted the Statutory Auditors and have 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 loss of the company for that year.

c) Proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting frauds and others irregularities have been taken to the best of their knowledge and ability.

d) The annual accounts have been prepared on a "going concern basis".

CORPORATE GOVERNANCE

The requirements of Corporate Governance are not applicable to the company in view of its paid-up capital being less than the limits specified forthe purpose by the authorities.

ADDITIONAL INFORMATION

a) CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

The information required u/s 217(l)(e) of the Company''s Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988 with respect of these matters is appended hereto (Annexure 1) and form part of this report.

b) No information is to be furnished pursuant to provisions of section 217(2)(A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975 as there are no employees including Whole Time Directors drawing remuneration in excess of the limits prescribed in the said section/rules.

c) The company has obtained a Compliance Certificate from a Company Secretary in whole time practice as required under sub-section (1) of Section 383A of the Companies Act, 1956 which is enclosed herewith forming part of Directors'' Report.

By Order of the Board (M.Z.KOTHARI)

MANAGING DIRECTOR (RAHUL DUGAR) DIRECTOR

PLACE: Mumbai DATED: 31st May, 2014

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Mar 31, 2013

TO THE SHAREHOLDERS

The Directors present their Annual Report together with Audited Accounts of the company for the year ended 31* March, 2013 FINANCE AND ACCOUNTS

2013 2012 Rs in lacs Rs in lacs

a) Revenue from operations 1249.63 1361.05

b) Other Income 8.19 12.28 1257.82 1373.33

Operating Profit (loss) before Extraordinary items and Tax 130.67 215.06

Less: Depreciation 151.61 120.72

Less: Extraordinary items 94.10

Less: Provision for Income Tax (net) (0.48)

Add/Less: Deferred Tax (credit) (7.86) 0.56

Profit for the year after tax (13.08) 0.16

Add: Profit b/f from previous year 10.99 10.83

Balance available for appropriations (2.09) 10.99

Less: Interest of Dividend Distribution Tax for previous year

Balance carried to Balance Sheet (2.09) 10.99

Your Directors have to inform that the due to slow down in automotive industry which has affected turnover of the company by 8% over previous year and stood at Rs 1249.63 lacs against Rs 1361.05 lacs. However exports have increased by 27% to Rs 199.25 lacs .The EBITDA for the year under review is Rs.269.36 lacs as against Rs.340.74 lacs in previous year. The Company is trying to offset the adverse effects of the demand recession in India by increase exports.

Allotment of equity shares at premium

The shares, pursuant to the Order of the Hon''ble Bombay High Court dated December 08, 2011, sanctioning the scheme of arrangement of the company with its specified creditors for conversion of unsecured loans of Rs. 3.20 crores into 800000 equity shares of face value of Rs 10/-each at a premium of Rs 30/- pershare; has beenallottedduringtheyearunder review.

AUDITORS

Messrs. R. A. Singh & Associates, Chartered Accountants, Mumbai, FRN110271W the retiring auditors are eligible for re-appointment. The Board recommends their re-appointment.

COST AUDITORS

The Board of Directors are in the process of appointing a Cost Auditor as required by The Companies (Cost Audit Report) Rules, 2011 and the Cost Audit Order No 52/26/CAB/2010datedJanuary24,2012.

DIRECTORS

Shri Bhagat S.Dugar retires by rotation and being eligible, offers himself for re- appointment. The Directors recommend his re-appointment.

Shri Mohan Z. Kothari, Jt.Managing Director has been re-appointed for a further period of 3 years w.e.f. 1 st April 2013 by the Board of Directors. The notice convening the Annual General Meeting includes the proposals for re-appointment and payment of remuneration to the Jt. Managing Director. The Directors recommend his re-appointment. -

EMPLOYEE RELATIONS

Your Directors would also like to place on record their appreciation for the services rendered by all categories of thecompany''semployees.

BANKER

Your Directors would like to place on record their appreciation for the pro-active support and assistance given by the banker. Bank of India and look forward to receive their continued support and assistance.

DIRECTORS'' RESPONSIBILITY STATEMENT

The company is in compliance with various accounting and financial reporting requirements in respect of the financial statements for the year under review. Pursuant to Section 217 (2AA) of the Companies Act, 1956, and in respect of the annual accountsforthe year under review, the Directors hereby confirm that:

a) In preparationof annual accounts, the applicable accounting standards have been followed save and except those mentioned in the Notes forming part of Accounts.

b) They have in the selection of the accou nting policies, consulted the Statutory Auditors and have 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 compa ny at the end of the fina ncia I year a nd of the lossofthecompanyforthatyear.

c) Proper and sufficient careformaintenanceofadequateaccountingrecords in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting frauds and others irregularities have been taken to the best of their knowledge and ability.

d) The annual accounts have been prepared on a "going concern basis".

CORPORATE GOVERNANCE

The requirements of Corporate Governance are not applicable to the company in view of its paid-up capital being less than the limits specified for the purpose by the authorities.

ADDITIONAL INFORMATION

a) CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

The information required u/s 217(l)(e) of the Company''s Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988 with respect of these matters is appended hereto (Annexure 1) and form part of this report.

b) No information is to be furnished pursuant to provisions of section 217(2)(A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975 as there are no employees including Whole Time Directors drawing remuneration in excess of the limits prescribed in the said section/rules.

c) The company has obtained a Compliance Certificate from a Company Secretary in whole time practice as required under sub-section (1) of Section 383A of the Companies Act, 1956 which is enclosed herewith forming part of Directors''Report.

By Order of the Board

(R.MAZUMDAR)

MANAGING DIRECTOR

(RAHUL DUGAR)

DIRECTOR

PLACE: Mumbai

DATED: 31st May, 2013

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Mar 31, 2012

The Directors present their Annual Report together with Audited Accounts of the company for the year ended 31st March, 2012

2012 2011 Rs in lacs Rs in lacs

a) Revenue from operations 1361.05 1190.33

b) Other Income 12.28 4.14

1373.33 1194.47

Operating Profit before Extraordinary items and Tax 94.34 32.48

less: Extraordinary items 94.10

Less: Provision for Income Tax - MAT- (net) 0.19

Add/Le ss: Deferred Tax (credit) 0.08 7.64

Profit for the year after tax 0.16 24.65

Add: Profit b/f from previous year 10.83 (13.82)

Balance available for appropriations 10.99 10.83

Less: Interest of Dividend Distribution Tax for previous year - -

Balance carried to Balance Sheet 10.99 10.83

Your Directors have to inform that the turnover of the company increased by 14% to Rs 1361.05 lacs. Further exports have increased by 100% to Rs 156.99 lacs. The EBITDA for the year under review is Rs.340.74 lacs as against Rs.242.39 lacs in previous year. Your Directors have to further report that consequent on the euro zone crises there has been a down turn in the automotive industry resulting in a demand recession. Fortune of the automotive industry are expected to revive from the third quarter of the current year.

Allotment of equity shares at premium

The Hon'ble Bombay High Court has vide its order dated December 08,2011, sanctioned the scheme of arrangement of the company with its specified creditors for conversion of unsecured loans of Rs. 3.20 crores into 800000 equity shares of face value of Rs 10/- each at a premium of Rs 30/- per share. The Hon'ble Bombay High Court had further ordered that the said preferential allotment be done after adjudication and payment of stamp duty. The adjudication order has been received and the payment is being made within the stipulated time.

AUDITORS

Messrs. R. A. Singh & Associates, Chartered Accountants, Mumbai, FRN110271W the retiring auditors are eligible for re-appointment. The Board recommends their re-appointment.

COST AUDITORS .

The Ministry of Corporate Affairs (MCA) has introduced The Companies (Cost Audit Report) Rules,2011 vide its notification no GSR 430(E) dated June 03,2011. This rules make it mandatory for industries to appoint a Cost Auditor with in 90 days of the commencement of the financial year. The Cost Audit Order No 52/26/CAB/2010 dated January 24, 2012 covers engineering machinery (electrical and electronic products) due to which the Company's manufacturing operations will get covered w.e.f. April 01,2012. The company is in process of appointing the Cost Auditor.

DIRECTORS

Shri Rahul Dugar Director who retires by rotation and being eligible offer him self for re-appointment. The Directors recommend his re-appointment.

EMPLOYEE RELATIONS

Your Directors are pleased to place on record their sincere appreciation of the sacrifice made voluntarily in the remuneration by all officers of the company to help the company tide over the global meltdown. Your Directors would also like to place on record their appreciation for the services rendered by all categories of the company's employees.

BANKERS

Your Directors would like to place on record their appreciation for the pro-active support and assistance given by the bankers, Bank of India and look forward to receive their continued support and assistance.

DIRECTORS' RESPONSIBILITY STATEMENT

The company is in compliance with various accounting and financial reporting requirements in respect of the financial statements for the year under review. Pursuant tc Section 217 (2AA) of the Companies Act, 1956, and in respect of the annual accounts for the year under review, the Directors hereby confirm that:

a) In preparation of annual accounts, the applicable accounting standards have been followed save and except those mentioned in the Notes forming part of Accounts.

b) They have in the selection of the accounting policies, consulted the Statutory Auditors and have 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.

c) Proper and sufficient care for maintenance of adequate accounting safeguarding the assets of the company and for preventing and detecting frauds and others irregularities have been taken to the best of their knowledge and ability

d) The annual accounts have been prepared on a "going concern basis".

CORPORATE GOVERNANCE

The requirements of Corporate Governance are not applicable to the company in view of its paid-up capital being less than the limits specified for the purpose by the authorities.

ADDITIONAL INFORMATION

a) CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

The information required u/s 217(l)(e) of the Company's Act, 19S6 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988 with respect of these matters is appended hereto (Annexure 1) and form part of this report.

b) No information is to be furnished pursuant to provisions of section 217(2)(A) of the Companies Act, 19S6 and the Companies (Particulars of Employees) Rules, 1975 as there are no employees including Whole Time Directors drawing remuneration in excess of the limits prescribed in the said section/rules.

c) The company has obtained a Compliance Certificate from a Company Secretary in whole time practice as required under sub-section (1) of Section 383A of the Companies Act, 1956 which is enclosed herewith forming part of Directors' Report.

By Order of the Board

(R.MAZUMDAR)

MANAGING DIRECTOR

(RAHULDUGAR)

DIRECTOR

PLACE: Mumbai

DATED: 31st July, 2012

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Mar 31, 2011

DIRECTORS' REPORT TO THE SHAREHOLDERS

The Directors present their Annual Report together with Audited Accounts of the company for the year ended 31st March, 2011

1. FINANCE AND ACCOUNTS

2011 2010 Rs. in lacs Rs. in lacs

a) Sales 1190.33 767.51

b) Other Income 4.14 9.69

1194.47 777.20

Operating Profit before Tax 32.48 (61.27)

Less : Provision for Income Tax 0.19 - MAT - (net)

Add/Less : Deferred Tax (credit) 7.64 (27.64)

Profit for the year after Tax 24.65 (33.63)

Add. Profit b/f from previous year (13.82) 20.09

Balance available for appropriations 10.83 (13.54)

Less:

Interest of Dividend Distribution - 0.28 Tax for Previous Year

Balance carried to Balance Sheet 10.83 (13.82)

Your Directors are pleased to inform that consequent to the demand revival, the turn over of the company increased by 55% to Rs 1190.33 lacs resulting in EBITDA of Rs.242.39 lacs as against Rs.125.19 lacs in previous year. The net profit after tax has also increased to Rs.24.65 lacs as against a net loss of Rs.33.63 lacs in previous year. The order book is healthy and barring unforeseen circumstances, your company expects to achieve better sales and consequent profits in the current year. Issue and Allotment of equity shares at premium

The Company has filed an application together with a scheme of arrangement with its specified creditors for settlement of unsecured loans amounting to Rs.3.20 Crores given by them by issue and allotment of 800000 equity shares of Rs.10/- each at a premium of Rs.30/- u/s 391 and 394 of the Companies Act 1956 with the Hon'ble Bombay High Court. The said application was filed after obtaining the NOC to the proposed scheme from the Bombay Stock Exchange as per the terms of the Listing Agreement. The Hon'ble Bombay High Court had vide its order dated 6-5-2011 directed the company to convene the meeting of its member on 13-6-2011 for approval of the said scheme. The meeting was held on the appointed date and the scheme was approved by the requisite majority of the members. The company has filed the Chairman's Report on the outcome of the meeting with the Hon'ble Bombay High Court. The Hon'ble Bombay High Court has admitted the petition on 29th July, 2011 .Necesssary steps will be taken by the company to give effect to the scheme as per the directions of the Hon'ble Bombay High Court.

2. AUDITORS

Messrs. R. A. Singh & Associates, Chartered Accountants, Mumbai, FRN 110271W the retiring auditors are eligible for re-appointment. The Board recommends their re-appointment.

3. DIRECTORS

Mr. R.Mazumdar, Managing Director has been re-appointed for a further period of 3 years w.e.f. 1st January,2011 by the Board of Directors. The notice convening the Annual General Meeting includes the proposals for re-appointment and payment of remuneration to the Managing Director.

Mr. Bhagat Singh Dugar, Chairman has been appointed as Executive Chairman for a period of 3 years w.e.f. 1st April 2011 by the Board of Directors. The notice convening the Annual General Meeting includes the proposals for appointment and payment of remuneration to the Executive Chairman.

Mr. Rahul Dugar resigned as a Whole Time Director on 31st March 2011 but continues as a Director on the Board of the Company. Your Directors place on record their appreciation of his services and look forward to the continued benefit of his advice.

4. EMPLOYEE RELATIONS

Employee's relation remained cordial during the year. Your Directors would like to record their appreciation for the services rendered by all categories of the company's employees.

5. BANKERS

Your Directors would like to place on record their appreciation for the- pro-active support and assistance given by the bankers, Bank of India and look forward to receive their continued support and assistance.

6. DIRECTORS' RESPONSIBILITY STATEMENT

The company is in compliance with various accounting and financial reporting requirements in respect of the financial statements for the year under review. Pursuant to Section 217 (2AA) of the Companies Act, 1956, and in respect of the annual accounts for the year under review, the Directors hereby confirm that:

a) In preparation of annual accounts, the applicable accounting standards have been followed save and except those mentioned in the Notes to Accounts in Schedule 16.

b) They have in the selection of the accounting policies, consulted the Statutory Auditors and have 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 and loss account of the company for that year.

c) Proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting frauds and others irregularities have been taken to the best of their knowledge and ability.

d) The annual accounts have been prepared on a "going concern basis".

7. CORPORATE GOVERNANCE

The requirements of Corporate Governance are not applicable to the company in view of its paid-up capital being less than the limits specified for the purpose by the authorities.

8. ADDITIONAL INFORMATION

a) CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

The information required u/s 217(1)(e) of the Company's Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988 with respect of these matters is appended hereto (Annexure 1) and form part of this report.

b) No information is to be furnished pursuant to provisions of section 217(2)(A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975 as there are no employees including Whole Time Directors drawing remuneration in excess of the limits prescribed in the said section/ rules.

c) The company has obtained a Compliance Certificate from a Company Secretary in whole time practice as required under sub-section (1) of Section 383A of the Companies Act, 1956 which is enclosed herewith forming part of Directors' Report.

By Order of the Board

(B. S. DUGAR) CHAIRMAN

(R. MAZUMDAR) MANAGING DIRECTOR

PLACE: MUMBAI DATED: 30th JULY, 2011

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Mar 31, 2010

The Directors present their Annual Report together with Audited Accounts of the company for the year ended 31st March, 2010

1. FINANCE AND ACCOUNTS

2010 2009

Rs. in lacs Rs. in lacs

a) Sales 767.51 664.37

b) Other Income 5.65 4.13

773.16 668.50

Operating Profit before Tax (61.27) (83.93)

Less : Provision for Income Tax - 1.19

(including Fringe Benefit Tax)

Add/Less: Deferred Tax (credit) (27.64) (15.25)

Profit for the year after Tax (33.63) (69.87)

Add. Profit b/f from previous year 20.09 107.52

Balance available for appropriations (13.54) 37.65

Less Preference Dividend - 15.00

Dividend Distrbution Tax - 2.54

Interest of Dividend Distribution 0.28 -

Tax for Previous Year

Balance carried to Balance Sheet (13.82) 20.09

The global meltdown, which impacted particularly the Automotive Industry - the sector in which your company operates - severely effected the companys performance during the previous year, continued for the first 6 months of the year under review. Your Directors are pleased to inform that the demand has since revived, which has resulted in higher sales of Rs.767.51 lacs in the current year as against Rs. 664.37 lacs in the previous year. The order book is healthy and barring unforeseen circumstances, your company expects to achieve better sales and consequent profits in the current year.

Issue and Allotment of equity shares at premium

Pursuant to the Special Resolution" passed by the members of the company at the Annual General Meeting held on September 30,2009 authorising the company to issue and allot equity shares of Rs.10/- each at a premium of Rs.30/- to the promoters u/s. 81 of the Company Act, 1956, an application dated January 11, 2010 was made to SEBI seeking exemption under Regulation 4 of SEBI (Substantial Acquisition of Shares and Takeovers) Regulation 1997. The Takeover Panel had rejected the application. The Promoters had then made representation to the Member, SEBI who after considering the Promoters representation directed theTakeover Panel to reconsider the same. The decision of the Takeover Panel is pending.



Broach Project

M/s. Arthur Klink GmbH had failed and neglected to discharge their contractual obligations and responsibilities, the company terminated the Contract and recalled the advance amount of Euro 197,435. As Arthur Klink GmbH did not repay the said advance, the company has invoked arbitration under the International Zurich Chamber of Commerce, Zurich. The said arbitration is pending. The company is hopeful of getting a favorable outcome in the matter.

2. AUDITORS

Messrs. R. A. Singh & Associates, Chartered Accountants, Mumbai, FRN 110271W the retiring auditors are eligible for re-appointment. The Board recommends their re-appointment.

3. DIRECTORS

Mr. M. Z. Kothari and Mr. Rahul Dugar both Whole Time Directors retire and are eligible for re-appointment at the forthcoming Annual General Meeting. The notice convening the Annual General Meeting includes the proposals for re-appointment and payment of remuneration to said Whole Time Directors.

4. EMPLOYEE RELATIONS

Your Directors are pleased to place on record their sincere appreciation of the sacrifice made voluntarily in the remuneration by all officers of the company to help the company tide over the global meltdown. Your Directors would also like to place on record their appreciation for the services rendered by all categories of the companys employees.

5. BANKERS

Your Directors would like to place on record their appreciation for the pro-active support and assistance given by the bankers, Bank of India and look forward to receive their full support and assistance.

6. DIRECTORS RESPONSIBILITY STATEMENT

The company is in compliance with various accounting and financial reporting requirements in respect of the financial statements for the year under review. Pursuant to Section 217 (2AA) of the Companies Act, 1956, and in respect of the annual accounts for the year under review, the Directors hereby confirm that:

a) In preparation of annual accounts, the applicable accounting standards have been followed save and except those mentioned in the Notes to Accounts in Schedule 16.

b) They have in the selection of the accounting policies, consulted the Statutory Auditors and have 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 and loss account of the company for that year.

c) Proper and sufficient care for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting frauds and others irregularities have been taken to the best of their knowledge and ability.

d) The annual accounts have been prepared on a "going concern basis".

CORPORATE GOVERNANCE

The requirements of Corporate Governance are not applicable to the company in view of its paid-up capital being less than the limits specified for the purpose by the authorities.

8. ADDITIONAL INFORMATION

a) CONSERVATION OF ENERGY/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS/OUTGO.

The information required u/s 217(1)(e) of the Companys Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules 1988 with respect of these matters is appended hereto (Annexure 1) and form part of this report.

b) No information is to be furnished pursuant to provisions of section 217(2)(A) of the Companies Act, 1956 and the Companies (Particulars of Employees) Rules, 1975 as there are no employees including Whole Time Directors drawing remuneration in excess of the limits prescribed in the said section/ rules.

c) The company has obtained a Compliance Certificate from a Company Secretary in whole time practice as required under sub-section (1) of Section 383A of the Companies Act, 1956 which is enclosed herewith forming part of Directors Report.

By Order of the Board

(B. S. DUGAR) CHAIRMAN

(R. MAZUMDAR) MANAGING DIRECTOR

PLACE: MUMBAI

DATED: 7th AUGUST, 2010