Directors Report of Modipon Ltd.

Mar 31, 2018

To the Shareholders,

The Directors have pleasure in presenting the 51st Annual Report with Audited Financial Statements for the financial year ended 31st March, 2018.

FINANCIAL HIGHLIGHTS

FINANCIALHIGHLIGHTS	2017-18 $ Lacs	2016-17 $ Lacs
Turnover	-	-
Other Income	21.42	1.79
Gross Profit (Loss) before Dep.	(518.87)	(487.92)
Depreciation	1.36	1.27
Profit/(Loss) after Depreciation	(520.23)	(489.19)
Add/(Less) Exceptional Income/ (Losses)	61.17	271.87
Profit/ (Loss) before Tax	(459.06)	(217.32)
Less/ (Add) :
Provision for Taxation- Fringe Benefit Tax	-	-
Extra Ordinary item Taxes for earlier Year	-	-
Net Profit/(Loss) after Tax	(459.06)	(217.32)

CLOSURE OF MANUFACTURING OPERATIONS

As reported earlier, the factory of the Company had been permanently closed down after seeking requisite permission from Government of Uttar Pradesh under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947. The Company is now exploring other possibilities so as to have optimal utilization of its real estate and other business activity.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

Subsequent to the date of financial statements, Punjab National Bank has initiated the proceedings against the Company under Section 7 of the Insolvency and Bankruptcy Code, 2016 before the NCLT, Allahabad Bench and other proceedings before DRT-II and Recovery Officer, DRT-II, New Delhi.

CURRENT STATUS OF OPERATIONS

Since the Company owns substantial real estate, in its Endeavour to rehabilitate the Company and to tap its resources to augment finances so as to be able to liquidate its huge liabilities and to utilize the surplus for taking up new business activity in the Company, as authorized by the Memorandum of Association of the Company, the Board of Directors of the Company has taken on record some new projects along with the real estate business. The Company proposes to commence new project at an opportune time.

BOARD MEETINGS

The Board of Directors met 7 (Seven) times during the period from 1^st April, 2017 to 31^st March, 2018. The Directors met on 12^th May, 2017, 20^th July, 2017, 14^th August, 2017, 30^th August, 2017, 14^th November, 2017, 27^th December, 2017 and 07^th February, 2018.

DIVIDEND

In view of the Losses suffered by the Company in the past, your Directors are unable to recommend any Dividend on Equity Share Capital.

OPERATIONS

During the year under review, the Company had not earned any revenue from the operations and has reported a loss after tax of Rs. (459.06) lacs after taking into account exceptional income.

DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors of the Company at present has six members. After the last Annual General Meeting of the Company during the year there has been certain change in the Board of Directors of the Company.

S. No	Name of Director	Category	Date of Appointment/ Cessation
1.	MR. SHASHI KANT RANJAN	INDEPENDENT DIRECTOR	APPOINTED ON 27.12.2017
2.	MR. HEMANT KUMAR SINGH	INDEPENDENT DIRECTOR	RESIGNED ON 28.09.2017

Mr. Shashi Kant Ranjan was appointed as the Additional Director w.e.f. 27^th December, 2017 by the Board of Directors. Further in the meeting of Board of Directors held on July 18, 2018, the Board has given their consent for regularization of his appointment as Independent Director subject to approval of shareholders at this Annual General Meeting. The terms of appointment of Mr. Shashi Kant Ranjan were issued by the Managing Director of the Company and are available for viewing on the website of the Company viz. www.modipon.net.

Mr. Manish Kumar Modi was appointed as the Managing Director of the Company w.e.f. 01^st June, 2013 for a period of 5 years and his tenure completed on May 31, 2018. Accordingly, Mr. Manish Kumar Modi has offered himself for reappointment as Managing Director for a further period of 5 years. The reappointment of Mr. Manish Kumar Modi including the terms and conditions and remuneration has also been considered and recommended by the Nomination and Remuneration Committee and the approval of the Board was also obtained in the meeting dated May 28, 2018. Now the same has been put forward for approval of shareholders in this Annual General Meeting. And thereafter an application will be made to Central Government for their approval in accordance with the provisions of Section 197 read with Schedule V of the Companies Act, 2013 as the status of Mr. Manish Kumar Modi has been changed from Resident to Non Resident of India.

KEY MANAGERIAL PERSONNEL

In pursuance of requirement of Section 203 of the Companies Act, 2013, Mr. Manish K. Modi, Managing Director, Mr. Vineet Kumar Thareja, Company Secretary & Compliance Officer and Mr. Vikas Bhatia, Chief Financial Officer were designated as Key Managerial Personnel of the Company.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

As required under Section 149(7) all the Independent Directors on the Board of the Company have issued their annual declaration stating that they meet all the criteria of independence as required under the Act.

STOCK EXCHANGE LISTING

The Securities of the Company are listed with the Bombay Stock Exchange.

COMMITTEES OF THE COMPANY

A. AUDIT COMMITTEE

In compliance with Section 177 of the Companies Act, 2013 and Regulation 18 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, an Audit Committee consisting of three Independent Directors and one Non-executive Director has been reconstituted during the year 2017-18. Mr. Shashi Kant Ranjan is the Chairman of the said Committee with Mr. Vivek Gupta, Dr. M. K. Modi and Mr. Ranvir Prasad, being other members of the said Committee. The said Committee met on 12^th May, 2017, 14^th August, 2017, 30^th August, 2017, 14^th November, 2017 and 07^th February, 2018.

There were no occasions during the year where the Board of Directors did not accept the recommendations of the Audit Committee.

B. NOMINATION AND REMUNERATION COMMITTEE

In compliance with Section 178(1) and Regulation 19 of SEBI (Listing Obligations and Disclosures Requirements) Regulations, 2015, the Company has reconstituted the Nomination & Remuneration Committee during the year 2017-18. The Nomination & Remuneration Committee consist of two Independent Directors and one Non-executive Directors. Mr. Vivek Gupta is the Chairman of the said Committee with Dr. M.K. Modi and Mr. Shashi Kant Ranjan as Members of the Committee.-

The said Committee met on 20^th July, 2017, 27^th December, 2017 and 07^th February, 2018.

The said Committee laid down the Policy on Remuneration stating therein the positive attributes required for the Managing Director, Independent Directors and Key Managerial Personnel. The said policy also states the modus operandi for determining the remuneration to the above said personnel. The Policy on remuneration of the Company can be viewed on the Company’s website www.modipon.net.

C. STAKEHOLDERS’ RELATIONSHIP COMMITTEE

In compliance with Section 178(5) of the Companies Act, 2013, the Company has reconstituted the Stakeholders’ Relationship Committee during the year 2017-18. The Stakeholders’ Relationship Committee consist of three members. Dr. M. K. Modi is the Chairman of the said Committee with Mrs. Aditee Modi and Mr. Shashi Kant Ranjan as Members of the Committee.

The said Committee met on 07^th February, 2018.

D. RISK MANAGEMENT COMMITTEE

The Company has also constituted a Risk Management Committee consisting of three members. Dr. M. K. Modi is the Chairman of the said Committee with Mr. Vivek Gupta and Mrs. Aditee Modi as Members of the Committee.-

The said Committee laid down the Policy on Risk Management stating therein the objectives and purpose of the said policy. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving those risks which are material in nature and are associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on material risk related issues.

RISK MANAGEMENT POLICY

The Risk Management Policy of the Company can be viewed on the Company’s website www.modipon.net.

VIGIL MECHANISM

In compliance with Section 177 (9) of the Companies Act, 2013 and Regulation 22 of SEBI (Listing obligations and Disclosures Requirements) Regulations, 2015, the Company has framed a whistleblower policy which can be viewed on Company’s website www.modipon.net. In terms of the said policy the Directors and employees are given direct access to the Chairman of the Audit Committee to report on alleged wrongdoings.

EXPORTS

On account of closure of the manufacturing operations of the Company, there has not been any export during the year. The FOB value of exports during the previous financial year was nil.

WHISTLE BLOWER POLICY

The Company has a Whistle Blower Policy, including vigil mechanism to report genuine concerns of grievances, providing direct access to the Chairperson of the Audit Committee in appropriate and exceptional cases. The Whistle Blower Policy has been posted on the website of the Company www.modipon.net.

INTERNAL FINANCIAL CONTROL

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no material weakness was observed. Even though the Company has in place adequate internal audit system which is commensurate with the operations of the Company, the testing and evaluation of internal financial control over financial reporting as mentioned in the guidance note of the Institute of Chartered Accountants of India is yet to be undertaken.

During the year, the Company could not appoint an Internal Auditor because of acute financial position and closure of operations of the Company.

NOMINATION & REMUNERATION POLICY

Nomination & Remuneration Policy of the company, as formulated and approved by Nomination and Remuneration Committee in its meeting held on 1^st August, 2015, governs Directors’ appointment including criteria for determining their qualifications, positive attributes, their independence and remuneration for the Directors, KMPs and other employees. The Nomination and Remuneration Policy is posted on Company’s website www.modipon.net.

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS

Details of loan(s), guarantee and investments are given in the notes to Financial Statements.

AMOUNT, IF ANY, PROPOSED TO BE TRANSFERRED TO RESERVES

During the year under review, the Company has not transferred any money towards General Reserve.

PERSONNEL

Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is applicable on listed companies.

The Company has 6 (Six) No. of employee as on 31.03.2018.

Subsequent to the closure of the Manufacturing Operations of the Company, all issues of ex-workmen/employees have been amicably resolved. The total dues of these workmen/employees (other than 5 workmen who have not yet collected their payment) have been paid. These 5 ex-workmen/employees had approached DRT-II, New Delhi seeking order for payment of dues in excess of the legal dues as paid to the other workmen/ employees. Hon’ble DRT had directed them to approach the Labour Commissioner for adjudication of their dues. None has approached the Labour Commissioner as directed by DRT. However, as directed by DRT, the Company had deposited the amount payable to them with DRT which in the absence of any claim by these workmen, has been released by DRT to PNB.

Details as required pursuant to MCA Notification G.S.R. 646(E) dated 30^th June, 2016 Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, none of the employee was in receipt of remuneration of Rs. One Crore and Two Lacs or more per year throughout the year or Rs. Eight Lacs and Fifty Thousand per month for the part of the year.

Further, none of the employees holds by himself or along with his spouse and dependent children, not less than 2% of equity shares of the Company.

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company.

Particulars about Key Managerial Personnel

a. Pursuant to the Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the information required to be disclosed by every Listed Companies in its Board Report are as follows:-

Name of Director/ KMP and Designation	Remuneration of Directors/ KMPs for FY 2017-18	% age increase in remuneration in FY 2017-18	Ratio of Remuneration to the median remuneration of employee
Mr. Manish Kumar Modi - Managing Director*	$ 18,76,000	NIL	2.76*
Mr. Vineet Kumar Thareja - Company Secretary **	$ 8,70,000	N.A.**	1.28
Mr. Vikas Bhatia -Chief Financial Officer***	$ 21,00,000	N.A.***	3.09

* The remuneration is within permissible limits as approved by MCA.

** Remuneration paid to him includes Medical Reimbursement.

*** Appointed also as CFO (KMP) w.e.f. 20.07.2017, remuneration taken as above is for a period of (9) Nine Months.

b. The Median remuneration (based on salary) of employees of the Company during the financial year 2017-18 was $ 6,80,000/-.

c. The percentage increase in the median remuneration (based on salary) of employees in the financial year 2017-18 was 6%.

d. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Since Company is a non-operational company and in view of losses, nominal increase was made in the managerial remuneration while no increase is approved by the MCA in the remuneration of Managing Director.

e. It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company.

FIXED DEPOSITS

At the beginning of the financial year, the balance on account of Fixed Deposits accepted from the Public and Members stood at Rs. Nil. There was no deposit liable to be transferred to the credit of Investors’ Education and Protection Fund.

The Company has not accepted any deposits during the year as envisaged under Sections 73, 74 & 76 of the Companies Act, 2013.

MATERIAL CHANGES AND COMMITMENT, IF ANY, AFFECTING FINANCIAL POSITION OF THE COMPANY FROM THE END OF FINANCIAL YEAR AND TILL THE DATE OF THIS REPORT:

There has been no material change and commitment, affecting the financial performance of the Company occurred between the end of the Financial Year of the Company to which the Financial Statements relate and the date of this Report.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the permanent closure of the Manufacturing Operations, provisions relating to furnishing of the details of (i) Conservation of Energy, (ii) Research & Development and Technology Absorption and (iii) Foreign Exchange Earning and Outgo in accordance with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

AUDITORS AND AUDIT REPORT

M/s B.M. Chatrath & Co., Chartered Accountants, Noida (Firm Regn. No.301011E) were Appointed as the statutory auditors for a period of Five (5) years in the Annual General Meeting held on 30^th September, 2016. The requirement for ratification of appointment of Auditors by Members at each Annual General Meeting has been omitted as per Section 40 of the Companies (Amendment) Act, 2017 (notified on May 7, 2018).

With reference to the qualifications contained in the Auditors’ Report, the Directors wish to state that the Notes on Accounts and Significant Accounting Policies referred to by the Auditors in their Report are self-explanatory and hence do not call for any further comment.

COST AUDIT

In view of permanent closure of operations, the Company had applied for exemption from the requirement of Cost Audit. Accordingly, appointment of Cost Auditor is not envisaged.

REPORTING OF FRAUDS:

There was no instance of fraud during the year under review, which required the Statutory Auditors to report to the Audit Committee and /or Board under Section 143(12) of the Act and Rules framed thereunder.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013, the Directors of your Company declare as under:

(i) that in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(ii) that the Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the Financial year and of the Profit of the Company for that period;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Companies Act, 1956 for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that in view of the permanent closure of the Manufacturing Operations of the Company, the Directors had not prepared the Annual Accounts on a going concern basis.

(v) that the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

(vi) that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary Company.

EXTRACT OF THE ANNUAL RETURN

Pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Extract of the Annual Return of the Company made up as at the end of the Financial Year i.e. 31^st March, 2018 is attached by way of Annexure - 1 in Form MGT-9 to this report.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules made there under, the Company had appointed M/s. Ranjeet Verma & Associates., Practicing Company Secretary (FCS No. 6814, CP No.7463) of New Delhi as Secretarial Auditors of the Company for the period from 1^st April, 2017 to 31^st March, 2018.

M/s. Ranjeet Verma & Associates, have submitted their Secretarial Audit Report and have issued their certificate as per the prescribed format in MR-3 to the shareholders of the Company, which is annexed to this Report as Annexure -2. They have confirmed that the Company has proper board processes, a compliance mechanism in place and has also complied with the relevant statutes, rules and regulations applicable to the Company. They have also confirmed that the Company has complied with the necessary secretarial standards, as applicable.

For the Financial Year 2018-19 also Company has appointed M/s. Ranjeet Verma & Associates, Vaishali (Ghaziabad) as Secretarial Auditors of the Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS

During the year under review, there have been no significant and material orders passed by any regulators/courts/tribunals that could impact the Company’s operations in future.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the period under review, the Company has not made any loan to any third party as envisaged under Section 186 of the Companies Act, 2013.

The Company has not given any guarantee during the year.

RELATED PARTY TRANSACTIONS

As required under Section 188 of the Companies Act, 2013 and Regulation 23 of SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015, the Company places before the Audit Committee the list of related parties with whom arrangements have been made for sharing of expenses of maintaining of Office and transactions of loan etc. The Audit Committee accords its omnibus approval for such related party transactions on an annual basis. The updates on the transactions with the related parties are placed before the audit committee on a quarterly basis. The details are also placed before the Board of Directors for its information.

As required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Company has formulated a policy on related party transactions and the same was approved by the Audit Committee and the Board of Directors. The said policy has been uploaded on Company’s website www. modipon.net.

No related party transaction in the context of Section 188 of the Companies Act, 2013 and Regulation 23 of SEBI (Listing Obligations and Disclosures Requirements) Regulation, 2015 has been entered during the year under review. Pursuant to Clause (h) of sub-section (3) of Section 134 of the Act, Form no. AOC-2 showing NIL details of related party transactions for the Financial Year 2017-18, is enclosed as Annexure - 3.

FORMAL ANNUAL EVALUATION

As required under Section 134 (p) of the Companies Act, 2013 read with Regulation 17 and 19 and part D of Schedule II of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board of Directors approved the evaluation criteria for evaluating the performance of the Board of Directors, its Committees and the performance of Independent Directors.

Accordingly, as required under Schedule IV of the Companies Act, 2013 read with Regulation 17 and 19 and part D of Schedule II of SEBI(Listing Obligations and Disclosure Requirements) Regulations, 2015, the Independent Directors evaluated performance of the non-independent Directors and the Board as a whole. They also reviewed the performance of the Chairman of the Company and also assessed the quality, quantity and timelines of flow of information between the Company Management and the Board that was necessary for the Board to effectively and reasonably perform their duties.

Also, as required, the Board assessed the performance of the Independent Directors as per the criteria laid down and have recommended their continuation on the Board of the Company.

The Board of Directors assessed the performance of the individual Directors on the Board based on parameters such as, relevant experience and skills, ability and willingness to speak up, focus on shareholder value creation, governance standards, knowledge of business, processes and procedures followed, openness of discussion/integrity, relationship with management, impact on key management decisions etc. The members of the Committee of Audit, Nomination & Remuneration and Stakeholders Relationship were also assessed on the above parameters and also in the context of the Committee’s effectiveness vis-a-vis the Act and the listing requirements.

DISCLOSUREONCONFIRMATIONWITHTHE SECRETARIAL STANDARDS:

Your Directors confirm that the Secretarial Standards issued by the Institute of Company Secretaries of India have been duly complied with.

CORPORATE GOVERNANCE

The Report on Corporate Governance together with the Statutory Auditors’ Certificate thereon are annexed hereto and forms part of this Report. The Management Discussion and Analysis Report are annexed hereto and forms part of this Report.

The Company has also adopted the mandatory policy on Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013. Employees have been sensitized on the provisions of this enactment and the Company has also constituted an internal complaints committee with effect from 28^th May, 2015 to deal with complaints, if any, under the said Act. There was no complaint received during the year to report.

ADEQUACY OF INTERNAL CONTROLS

Your Company has in place adequate internal control systems combined with delegation of powers and periodic review of the process. The control system is also supported by internal audits and management reviews with documented policies and procedures.

ISSUE OF SHARES

During the year under review, the Company has not issued any Sweat equity shares or shares with differential rights or under Employee Stock Option Scheme nor did it buy-back any of its shares.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of Section 164(2) of the Companies Act, 2013. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 2013.

APPRECIATION

Your Directors would like to express their sincere appreciation to the various Departments of the Central and State Governments, UPSIDC’s directors and Investors for their continued valuable support and assistance. Your Directors also wish to thank all the Officers and Staff of the Company at all levels for their contribution, support and continued co-operation throughout the year.

For and on behalf of the Board,

Place : New Delhi (Manish K. Modi) (M. K. Modi)

Dated : 18^th July, 2018 Managing Director Chairman

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Mar 31, 2016

DIRECTORS'' REPORT

To the Shareholders,

The Directors have pleasure in presenting the 49th Annual Report with Audited Financial Statements for the financial year ended 31st March, 2016.

FINANCIAL HIGHLIGHTS

	2015-16 Rs, Lacs	2014-15 Rs,Lacs
Turnover	-	-
Other Income	325.18	28.14
Gross Profit (Loss)	(242.69)	(732.93)
Depreciation	0.62	0.39
Profit/(Loss) after Depreciation	(243.31)	(733.32)
Add/(Less) Exceptional Income/ (Losses)	815.38	485.69
Profit/(Loss) before Tax	572.07	(247.63)
Less/(Add) :
Provision for Taxation- Fringe Benefit Tax	-	-
Extra Ordinary item Taxes for earlier years	64.99	-
Net Profity(Loss) after Tax	637.06	(247.63)

CLOSURE OF MANUFACTURING OPERATIONS

As reported earlier, the industrial undertaking of the Company had been permanently closed down after seeking requisite permission from Government of Uttar Pradesh under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947. The Company is now exploring other possibilities so as to have optimal utilization of its real estate and other business activity.

EVENTS SUBSEQUENT TO THE DATE OF FINANCIAL STATEMENTS

Subsequent to the date of financial statements, Punjab National Bank has been considering assignment of the residual dues of the company to an Asset Reconstruction Company.

CURRENT STATUS OF OPERATIONS

Since the Company owns substantial real estate, in its Endeavour to rehabilitate the Company and to tap its resources to augment finances so as to be able to liquidate its huge liabilities and to utilize the surplus for taking up new business activity in the Company, as authorized by the Memorandum of Association of the Company, the Board of Directors of the Company had approved to commence Real Estate business. The Company proposes to commence Real Estate business at an opportune time.

BOARD MEETINGS

The Board of Directors met 4 times during the period of 12 months from 1st April, 2015 to 31st March, 2016. The Directors met on 28th May, 2015, 1st August, 2015, 10th November, 2015, and 12th February, 2016.

DIVIDEND

In view of the Losses suffered by the Company in the past, your Directors are unable to recommend any Dividend on Equity and Preference Share Capital.

OPERATIONS

During the year under review, the Company registered total revenue of Rs. 325.18 lacs from sale of old stocks etc. and has incurred a Loss after tax of Rs. 637.06 lacs after taking into account exceptional income.

PREFERENTIAL ISSUE OF SHARES

To clear the settled OTS dues of Punjab National Bank, the Company had availed a loan from M/s Modi Intercontinental P. Ltd. (a related party). The loan was repayable within one year. However, the Company could not repay the loan as yet. Therefore, the Company proposes to make a preferential allotment of 37,38,632 equity shares of the Company at a rate to be worked out as per SEBI Regulations to discharge the loan liability of Modi Intercontinental P. Ltd.

DIRECTORS & KEY MANAGERIAL PERSONNEL

The Board of Directors of the Company at present has six members. After the last Annual General Meeting of the Company during the year there has been no change in the Board of Directors.

Mr. Manish K. Modi is the Managing Director of the Company. He was appointed for a period of five years with effect from 1st June, 2013 and the appointment as Managing Director was duly approved by the Central Government for a period of five years.

In order to comply with the requirement of Section 149(4) & (5) of the Companies Act, 2013, two Independent Directors were appointed by the members at the AGM of the Company held on 30.09.2014 for a period of five years. The terms of appointment of these Independent Directors were issued by the Managing Director of the Company. The above referred terms & conditions of the letter are available for viewing on the website of the Company viz. www.modipon.net.

KEY MANAGERIAL PERSONNEL

In pursuance of requirement of Section 203 of the Companies Act, 2013, Mr. Manish K. Modi, Managing Director, Mr. A.K. Goel, Company Secretary and Mr. Narayan C. Rout, Chief Financial Officer were designated as Key Managerial personnel of the Company. Mr. Sushil Kumar Gupta the CFO appointed earlier had resigned from the service of the Company in December, 2015. The Board appointed Mr. Narayan Chandra Rout as Chief Financial Officer w.e.f. 1st June, 2016. Form DIR-12 in this regard was filed with the Registrar of Companies on 26.07.2016 vide SRN G08022451.

DECLARATION FROM INDEPENDENT DIRECTORS ON ANNUAL BASIS

As required under Section 149(7) all the Independent Directors on the Board of the Company have issued their annual declaration stating that they meet all the criteria of independence as required under the Act.

STOCK EXCHANGE LISTING

The Securities of the Company are listed with the Bombay Stock Exchange. COMMITTEES OF The COMPANY

A. AUDIT COMMITTEE

In compliance with Section 177 of the Companies Act, 2013 and Clause 49 (III) of the Listing Agreement, an Audit Committee consisting of two Independent Directors and two Non-executive Director has been constituted. Mr. Gaurav Sekhri is the Chairman of the said Committee with Mr. Vivek Gupta, Dr. M. K. Modi and Mr.Manoj Singh, being other members of the said Committee. The said Committee met on 28th May, 2015, 1st August, 2015, 10th November, 2015, and 12th February, 2016.

There were no occasions during the year where the Board of Directors did not accept the recommendations of the Audit Committee.

B. NOMINATION AND REMUNERATION COMMITTEE

In compliance with Section 178(4) and Clause 49(IV) of the Listing Agreement, the Company has constituted a Nomination & Remuneration Committee consisting of two Independent Directors and two Non-executive Directors. Mr. Gaurav Sekhri is the Chairman of the said Committee with Mr. Vivek Gupta, Dr. M.K. Modi and Mr.Manoj Singh as Members of the Committee.-

The said Committee met on 1st August, 2015.

The said Committee laid down the policy on Remuneration stating therein the positive attributes required for the Managing Director, Independent Directors and Key Managerial personnel. The said policy also states the modus operandi for determining the remuneration to the above said personnel. The policy on remuneration of the Company can be viewed on the Company''s website www.modipon.net.

C. STAKEHOLDERS'' RELATIONSHIP COMMITTEE

In compliance with Section 178(5) of the Companies Act, 2013, the Company has a Stakeholders'' Relationship Committee consisting of three members. Dr. M. K. Modi is the Chairman of the said Committee with Mrs.Aditee Modi and Gaurav sekhri as Members of the Committee.

The said Committee met on 12th February, 2016.

D. RISK MANAGEMENT COMMITTEE

In compliance with the requirement of Clause 49 of the Listing Agreement, the Company has also constituted a Risk Management Committee consisting of three members. Dr. M. K. Modi is the Chairman of the said Committee with Mr. Vivek Gupta and Mrs. Aditee Modi as Members of the Committee.-

The said Committee met on 12th February, 2016.

The said Committee laid down the policy on Risk Management stating therein the objectives and purpose of the said policy. The main objective of this policy is to ensure sustainable business growth with stability and to promote a pro-active approach in reporting, evaluating and resolving those risks which are material in nature and are associated with the business. In order to achieve the key objective, the policy establishes a structured and disciplined approach to Risk Management, in order to guide decisions on material risk related issues.

RISK MANAGEMENT POLICY

The Risk Management policy of the Company can be viewed on the Company''s website www.modipon.net.

VIGIL MECHANISM

In compliance with Section 177 (9) of the Companies Act, 2013 and Clause 49 (VIII) (H) (2) of the Listing Agreement, the Company has set up a whistleblower policy which can be viewed on Company''s website www.modipon,net. In terms of the said policy the Directors and employees are given direct access to the Chairman of the Audit Committee to report on alleged wrongdoings.

EXPORTS

on account of closure of the manufacturing operations of the Company, there has not been any export during the year. The FOB value of exports during the previous financial year was nil.

WHISTLE BLOWER POLICY:

The Company has a Whistle Blower policy, including vigil mechanism to report genuine concerns of grievances, providing direct access to the Chairperson of the Audit Committee in appropriate and exceptional cases. The Whistle Blower Policy has been posted on the website of the Company www.modipon.net.

INTERNAL FINANCIAL CONTROL:

The Company has in place adequate internal financial controls with reference to financial statements. During the year, such controls were tested and no material weakness was observed by the internal auditor of the Company. Even though the Company has in place adequate internal audit system which is commensurate with the operations of the Company, the testing and evaluation of internal financial control over financial reporting as mentioned in the guidance note of the Institute of Chartered Accountants of India is yet to be undertaken.

NOMINATION & REMUNERATION POLICY:

Nomination & Remuneration policy of the company, as formulated and approved by Nomination and Remuneration Committee in its meeting held on 1st August, 2015, governs Directors'' appointment including criteria for determining their qualifications, positive attributes, their independence and remuneration for the Directors, KMps and other employees. The Nomination and Remuneration policy is posted on Company''s website www.modipon.net.

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS:

Details of loan(s), guarantee and investments are given in the notes to Financial Statements.

PERSONNEL:

Rule 5 of the Companies (Appointment and Remuneration of Managerial personnel) Rules, 2014 is applicable on listed companies.

The Company had only 1 employee as on 31.03.2016.

Subsequent to the closure of the Manufacturing Operations of the Company, all issues of ex-workmen/employees have been amicably resolved. The total dues of these workmen/employees (other than 5 workmen who have not yet collected their payment) have been paid. These 5 ex-workmen/employees had approached DRT-II, New Delhi seeking order for payment of dues in excess of the legal dues as paid to the other workmen/employees. Hon''ble DRT had directed them to approach the Labour Commissioner for adjudication of their dues. None has approached the Labour Commissioner as directed by DRT. However, as directed by DRT, the Company had deposited the amount payable to them with DRT which in the absence of any claim by these workmen, has been released by DRT to PNB.

Details as required pursuant to MCA Notification G.S.R. 646(E) dated 30th June, 2016 Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, none of the employee was in receipt of remuneration of Rs. One Crore and Two Lacs or more per year throughout the year or Rs. Eight Lacs and Fifty Thousand per month for the part of the year.

Further, none of the employees holds by himself or along with his spouse and dependent children, not less than 2% of equity shares of the Company.

It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company.

Particulars about Key Managerial Personnel

a. Pursuant to the Rule 5(1) Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the information required to be disclosed by every Listed Companies in its Board Report are as follows:-

Name of Director/ KMP and Designation	Remuneration of Directors/ KMPs for FY 2015-16	% age increase in remuneration in FY 2015-16	Ratio of Remuneration to the median remuneration of employee	Comparison of the remuneration of the KMP against the performance of the company
Mr. Manish Kumar Modi - Managing Director*	Rs. 18,76,000	NIL	2.95*	The Company earned profit after tax of Rs. 637.06 lacs during 2015-16 as against loss of Rs. 247.63 during 2014-15
Mr. A.K. Goel - Company Secretary **	Rs. 15,72,000	N.A**	2.47
Mr. Sushil Gupta -Chief Financial Officer***	Rs. 5,77,000	N.A***	0.91

* The remuneration are within permissible limits as approved by MCA. There is no increase in remuneration during the year. Ratio calculated on basic salary.

** Appointed also as CS (KMP) w.e.f. 14th August, 2014, remuneration paid to him includes EPF and Medical Reimbursement. During the year an increment of 4% was granted to him as a CS.

*** Appointed also as CFO (KMP) w.e.f. 14th August, 2014, remuneration taken as above is for a period of 9 months. No increase was granted to him as a CFO.

b. The Median remuneration (based on basic salary) of employees of the Company during the financial year 2015-16 was Rs. 6,36,000/-.

c. The percentage increase in the median remuneration (based on basic salary) of employees in the financial year 2015-16 was 4%.

d. Variations in the market capitalization of the company, price earnings ratio as at the closing date of the current financial year and previous financial year and percentage increase over decrease in the market quotations of the shares of the company in comparison to the rate at which the company came out with the last public offer in case of listed companies, and in case of unlisted companies, the variations in the net worth of the company as at the close of the current financial year and previous financial year;

Company''s shares are not being regularly and actively traded since long in the stock exchange where the shares are listed hence no details are available.

e. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

Since Company is a non-operational company and in view of losses, nominal increase was made in the managerial remuneration while no increase is approved by the MCA in the remuneration of Managing Director.

f. The key parameters for any variable component of remuneration availed by the directors: No variable component of remuneration was availed by the Directors of the Company.

g. The ratio of the remuneration of the highest paid Director to that of the employees who are not Directors but receive remuneration in excess of the highest paid Director during the year:

The highest paid Director in the Company is Mr. Manish Kumar Modi with annual remuneration of Rs. 18 Lac as per Shareholders'' approval. There is no employee receiving remuneration in excess of the Director.

h. It is hereby affirmed that the remuneration paid is as per the Remuneration Policy of the Company.

FIXED DEPOSITS

At the beginning of the financial year, the balance on account of Fixed Deposits accepted from the Public and Members stood at Rs. Nil. There was no deposit liable to be transferred to the credit of Investors'' Education and Protection Fund.

The Company has not accepted any deposits during the year as envisaged under Sections 73, 74 & 76 of the Companies Act, 2013.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION,

FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the permanent closure of the Manufacturing Operations, provisions relating to furnishing of the details of (i) Conservation of Energy, (ii) Research & Development and Technology Absorption and (iii) Foreign Exchange Earning and Outgo in accordance with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

After the last Annual General Meeting of the Company during the year there has been no change in the Board of Directors.

AUDITORS AND AUDIT REPORT

At the last Annual General Meeting, M/s. S.R. Dinodia & Co. LLP, Chartered Accountants, New Delhi (Firm Regn. No.001478N/ N500005) were appointed as Statutory Auditors of the Company for a term of five years i.e. from the conclusion of 47th Annual General Meeting until the conclusion of the 52nd Annual General Meeting of the Company at a fee of Rs. 2,00,000/- plus applicable Service Tax etc. M/s S.R. Dinodia & Co., Chartered Accountants have, vide their letter dated 5th August, 2016, conveyed their unwillingness to continue as Auditors of the Company for the next year due to professional pre-occupation.

The Board of Directors have accordingly appointed M/s B.M. Chatrath & Co., Chartered Accountants, Noida (Firm Regn. No. 301011E) as Company''s auditors to hold office until the conclusion of the Fifty Fourth Annual General Meeting.

With reference to the qualifications contained in the Auditors'' Report, the Directors wish to state that the Notes on Accounts and Significant Accounting Policies referred to by the Auditors in their Report are self-explanatory and hence do not call for any further comment.

COST AUDIT

In view of permanent closure of operations, the Company had applied for exemption from the requirement of Cost Audit. Accordingly, appointment of Cost Auditor is not envisaged.

DIRECTORS'' RESPONSIBILITY STATEMENT

pursuant to Section 134(5) of the Companies Act, 2013, the Directors of your Company declare as under:

(i) that in the preparation of the Annual Accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(ii) that the Directors had selected such Accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the Financial year and of the Profit of the Company for that period;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Companies Act, 1956 for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that in view of the permanent closure of the Manufacturing Operations of the Company, the Directors had not prepared the Annual Accounts on a going concern basis.

(v) that the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively;

(vi) that the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary Company.

EXTRACT OF THE ANNUAL RETURN

pursuant to section 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the Extract of the Annual Return of the Company made up as at the end of the Financial Year i.e. 31st March, 2016 is attached by way of Annexure - 1 in Form MGT-9 to this report.

SECRETARIAL AUDIT

pursuant to the provisions of Section 204 of the Companies Act, 2013 and Rules made there under,, the Company had appointed M/s. Ranjeet Verma & Associates., practicing Company Secretary (FCS No. 6814, Cp No.7463) of New Delhi as Secretarial Auditors of the Company for the period from 1st April, 2015 to 31st March, 2016.

M/s. Ranjeet Verma & Associates., have submitted their Secretarial Audit Report and have issued their certificate as per the prescribed format in MR-3 to the shareholders of the Company, which is annexed to this Report as Annexure -2. They have confirmed that the Company has proper board processes, a compliance mechanism in place and has also complied with the relevant statutes, rules and regulations applicable to the Company. They have also confirmed that the Company has complied with the necessary secretarial standards, as applicable.

For the Financial Year 2016-17 also Company has appointed M/s. Ranjeet Verma & Associates, Vaishali (Ghaziabad) as Secretarial Auditors of the Company.

SIGNIFICANT & MATERIAL ORDERS PASSED BY THE REGULATORS

During the year under review, there have been no significant and material orders passed by any regulators/courts/tribunals that could impact the Company''s operations in future.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

During the period under review, the Company has not made any loan to any third party as envisaged under Section 186 of the Companies Act, 2013.

The Company has not given any guarantee during the year.

RELATED PARTY TRANSACTIONS

As required under Section 188 of the Companies Act, 2013 and Clause 49 (VII) & (VIII) of the Listing Agreement, the Company places before the Audit Committee the list of related parties with whom arrangements have been made for sharing of expenses of maintaining of Office and transactions of loan etc. The Audit Committee accords its omnibus approval for such related party transactions on an annual basis. The updates on the transactions with the related parties are placed before the audit committee on a quarterly basis. The details are also placed before the Board of Directors for its information.

As required under Clause 49 of the Listing Agreement, the Company has formulated a policy on related party transactions and the same was approved by the Audit Committee and the Board of Directors. The said policy has been uploaded on Company''s website www.modipon.net.

All the transactions with the related parties entered into during the period under review have been in the ordinary course of business and at arms'' length basis. There have been no material related party transactions entered into during this period which required the approval of the shareholders by way of special resolution. The details of related party transactions pursuant to Clause (h) of sub-section (3) of Section 134 of the Act, is enclosed in form no. AOC 2 as Annexure - 3.

FORMAL ANNUAL EVALUATION

As required under Section 134 (p) of the Companies Act, 2013 and Clause 49 (2) (B) (5) of the Listing Agreement the Board of Directors approved the evaluation criteria for evaluating the performance of the Board of Directors, its Committees and the performance of Independent Directors.

Accordingly, as required under Schedule IV of the Companies Act, 2013 and Clause 49 (II) (B) (6) of the Listing Agreement, the Independent Directors evaluated performance of the no independent Directors and the Board as a whole. They also reviewed the performance of the Chairman of the Company and also assessed the quality, quantity and timelines of flow of information between the Company Management and the Board that was necessary for the Board to effectively and reasonably perform their duties.

Also, as required under Clause 49 of the Listing Agreement, the Board assessed the performance of the Independent Directors as per the criteria laid down and have recommended their continuation on the Board of the Company.

The Board of Directors assessed the performance of the individual Directors on the Board based on parameters such as, relevant experience and skills, ability and willingness to speak up, focus on shareholder value creation, governance standards, knowledge of business, processes and procedures followed, openness of discussion/ integrity, relationship with management, impact on key management decisions etc. The members of the Committee of Audit, Nomination & Remuneration and Stakeholders Relationship were also assessed on the above parameters and also in the context of the Committee''s effectiveness vis-a-vis the Act and the listing requirements.

CORPORATE GOVERNANCE

The Report on Corporate Governance together with the Statutory Auditors'' Certificate thereon are annexed hereto and forms part of this Report. The Management Discussion and Analysis Report is annexed hereto and forms part of this Report.

The Company has also adopted the mandatory policy on Sexual Harassment of Women at Workplace (prevention, prohibition & Redressal) Act, 2013. Employees have been sensitized on the provisions of this enactment and the Company has also constituted an internal complaints committee with effect from 28th May, 2015 to deal with complaints, if any, under the said Act. There was no complaint received during the year to report.

ADEQUACY OF INTERNAL CONTROLS

Your Company has in place adequate internal control systems combined with delegation of powers and periodic review of the process. The control system is also supported by internal audits and management reviews with documented policies and procedures.

ISSUE OF SHARES

During the year under review, the Company has not issued any SWEAT equity shares or shares with differential rights or under Employee Stock Option Scheme nor did it buy-back any of its shares.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of Section 164(2) of the Companies Act, 2013. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

APPRECIATION

Your Directors would like to express their sincere appreciation to the various Departments of the Central and State Governments, UPSIDC''s nominee directors and Investors for their continued valuable support and assistance. Your Directors also wish to thank all the Officers and Staff of the Company at all levels for their contribution, support and continued co-operation throughout the year.

For and on behalf of the Board,

New Delhi (Manish K. Modi) (M. K. Modi)

Dated: 1st September, 2016 Managing Director Chairman

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Mar 31, 2014

Dear Members,

The Directors have pleasure in presenting the 47th Annual Report with Audited Financial Statements for the financial year ended 31st March, 2014.

FINANCIAL HIGHLIGHTS

2013-14 2012-13 Rs. Lacs Rs. Lacs

Turnover - -

Other Income 42.31 44.95

Gross Profit (Loss) (77.60) (171.10)

Depreciation 0.03 -

Profit/(Loss)afterDepreciation (77.63) (171.10)

Add/(Less)ExceptionalIncome/(Losses) 339.95 412.72

Profit/(Loss) before Tax 262.32 241.62

Less/(Add):

Provision for Taxation-FringeBenefit Tax - -

Extra Ordinary item - -

Net Profit/(Loss) after Tax 262.32 241.62

CLOSURE OF MANUFACTURING OPERATIONS

As reported earlier, the industrial undertaking of the Company had been permanently closed down after seeking requisite permission from Government of Uttar Pradesh under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947. The Company is now exploring other possibilities so as to have optimal utilization of its real estate and other business activity.

SETTLEMENT WITH BANKS

In its endeavour to arrive at an amicable One Time Settlement of the outstanding dues of the banks, the Company has finalized settlements with Abu Dhabi Commercial Bank, Allahabad Bank, Karnataka Bank and Bank of Baroda whose dues have been duly paid by the assignee of the debts. Recently, Punjab National Bank has also approved One Time Settlement of its dues. The settled dues are being paid by Ashoka Mercantile Limited (AML), a Group MKM Company. Accordingly, instead of the concerned banks, AML is now the secured creditor of the Company. The banks had initiated recovery proceedings under SARFESAI Act, 2002 and have sold the entire movable assets including Plant & Machinery, Stores & Spares and Structures of the Company which had been dismantled and removed. This had enabled the Company to reduce its NPA dues by Rs.33.61 crores. Further, a piece of Land admeasuring 47,815 Sq. Yds. had also been approved to be sold by Debts Recovery Tribunal, New Delhi.

CURRENT STATUS OF OPERATIONS

Since the Company owns substantial real estate, in its endeavour to rehabilitate the Company and to tap its resources to augment finances so as to be able to liquidate its huge liabilities and to utilize the surplus for taking up new business activity in the Company, as authorized by the Memorandum of Association of the Company, the Board of Directors of the Company had approved to commence Real Estate business w.e.f. 1st April, 2014. Accordingly, to facilitate carrying on of the real estate business, the land and buildings owned by the Company are proposed to be converted into Stock-in-trade.

DIVIDEND

In view of the Losses suffered by the Company in the past, your Directors are unable to recommend any Dividend on Equity and Preference Share Capital.

OPERATIONS

During the year under review, the Company registered total revenue of Rs. 42.31 lacs from sale of old stocks etc. and has earned a Profit after tax of Rs. 262.32 lacs after taking into account exceptional income.

EXPORTS

On account of closure of the manufacturing operations of the Company, there has not been any export during the year. The FOB value of exports during the previous financial year was nil.

FIXED DEPOSITS

The Company had stopped accepting deposits from public. During the year under review, no deposit was claimed for payment. At the end of the financial year, the balance on account of Fixed Deposits accepted from the Public and Members stood at Rs. 25.67 lacs which remained unclaimed/ unpaid. There was no deposit liable to be transferred to the credit of Investors'' Education and Protection Fund.

Presently the Company is neither accepting fresh deposits nor renewing the existing ones.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the permanent closure of the Manufacturing Operations, provisions relating to furnishing of the details of (i) Conservation of Energy, (ii) Research & Development and Technology Absorption and (iii) Foreign Exchange Earning and Outgo in accordance with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

DIRECTORS

After the last Annual General Meeting of the Company during the year there has been no change in the Board of Directors. Mr. Gaurav Sekhri, Mr. Vivek Gupta and Mrs. Aditee Modi have been appointed additional directors of the Company on 14.08.2014.

PERSONNEL

Subsequent to the closure of the Manufacturing Operations of the Company, all issues of ex-workmen/employees have been amicably resolved. The total dues of these workmen/ employees (other than 8 workmen who have not yet collected their payment) have been paid. These 8 ex-workmen/ employees had approached DRT-II, New Delhi seeking order for payment of dues in excess of the legal dues as paid to the other workmen/employees. Hon''ble DRT had directed them to approach the Labour Commissioner for adjudication of their dues. None has approached the Labour Commissioner as directed by DRT. However, as directed by DRT, the Company had deposited the amount payable to them with DRT, which in the absence of any chaim by these workmen,has been released by DRT to PNB.

There was no employee, employed for full or part of the year, whose particulars are to be given in terms of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

AUDITORS AND AUDIT REPORT

Messrs P R. Mehra & Co., Chartered Accountants, New Delhi, have been the statutory auditors of the Company since inception. Considering the provisons of Section 139(2) of the Companies Act, 2013 it has been thought expedient to rotate the statutoy auditors, accordingly M/s. S.R. Dinodia & Co.LLP, Chartered Accountants, New Delhi are proposed to be as appointed as Statutory Auditors of the Company for a term of five years.

With reference to the qualifications contained in the Auditors'' Report, the Directors wish to state that the Notes on Accounts and Significant Accounting Policies referred to by the Auditors in their Report are self-explanatory and hence do not call for any further comment.

COST AUDIT

The Central Government had approved the appointment of Messrs N. Dewan & Co., Cost Accountants, New Delhi to conduct the Cost Audit in respect of Nylon & Polyester Filament Yarns for the year ended 31st March, 2007. However, in view of permanent closure of operations, the Company had applied for exemption from the requirement of Cost Audit. Accordingly, their re-appointment is not envisaged.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the 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 Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the Financial year and of the Profit of the Company for that period;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Companies Act, 1956 for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that in view of the permanent closure of the Manufacturing Operations of the Company, the Directors had not prepared the Annual Accounts on a going concern basis.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary Company.

CORPORATE GOVERNANCE

The Report on Corporate Governance together with the Statutory Auditors'' Certificate thereon are annexed hereto and forms part of this Report. The Management Discussion and Analysis Report is annexed hereto and forms part of this Report.

ADEQUACY OF INTERNAL CONTROLS

Your Company has in place adequate internal control systems combined with delegation of powers and periodic review of the process. The control system is also supported by internal audits and management reviews with documented policies and procedures.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of Section 164(2) of the Companies Act, 2013. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

APPRECIATION

Your Directors would like to express their sincere appreciation to the various Departments of the Central and State Governments, UPSIDC''s nominee directors and Investors for their continued valuable support and assistance. Your Directors also wish to thank all the Officers and Staff of the Company at all levels for their contribution, support and continued co-operation throughout the year.

For and on behalf of the Board,

New Delhi (Manish K. Modi) (M. K. Modi) Dated:14th August,2014 Managing Director Chairman

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Mar 31, 2012

The Directors have pleasure in presenting the 45th Annual Report with Audited Statement of Accounts for the financial year ended 31st March, 2012.

FINANCIAL HIGHLIGHTS 2011-12 2010-11 Rs. Lacs Rs. Lacs

Turnover - -

Other Income 31.45 49.65

Gross Profit (Loss) (259.85) (300.45)

Depreciation 0.14 0.28

Profit/(Loss) after Depreciation (259.99) (300.73)

Add/(Less) Exceptional Income/(Losses) 474.44 389.44

Profit/(Loss) before Tax 214.45 88.71

Less/(Add) : - -

Provision for Taxation- Fringe Benefit Tax - -

Extra Ordinary item - (4899.00)

Net Profit/(Loss) after Tax 214.45 (4810.29)

SCHEME OF ARRANGEMENT

As reported earlier, the Company had, post re-structuring through Slump sales of Chemicals business alongwith certain specified assets, filed a Scheme of Arrangement U/s 391/393/394 of the Companies Act, 1956 before Hon'ble Allahabad High Court seeking its approval to the accounting treatment to the direct allotment of shares of IOIL by IOIL to the shareholders of the Company in part discharge of the purchase Consideration. Hon'ble High Court has, vide its order dated 8th September, 2010 approved the said Scheme of Arrangement.

CLOSURE OF MANUFACTURING OPERATIONS

As reported earlier, the industrial undertaking of the Company has been permanently closed down after seeking requisite permission from Government of Uttar Pradesh under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947. The Company is now exploring other possibilities so as to have optimal utilization of its real estate and other business activity.

SETTLEMENT WITH BANKS

In its endeavour to arrive at an amicable One Time Settlement of the outstanding dues of the banks, the Company has finalized settlement with Abu Dhabi Commercial Bank, Allahabad Bank and Karnataka Bank. Since the Company did not have resources to make the payment of settled OTS, the payment was done through another group company - Ashoka Mercantile Ltd. (AML) on assignment basis and accordingly, instead of the concerned banks, AML is now the secured creditor of the Company. The Company is desirous of liquidating the balance NPA dues of other banks under OTS on the lines of the settlement with Allahabad Bank. The banks had initiated recovery proceedings under SARFESAI Act, 2002 and have sold the Plant & Machinery, Stores & Spares and Structures of the Company which are in the process of being dismantled and removed. This has enabled the Company to reduce its NPA dues by Rs. 33.61 crores.

DIVIDEND

In view of the Losses suffered by the Company, your Directors are unable to recommend any Dividend on Equity and Preference Share Capital.

OPERATIONS

During the year under review, the Company registered total revenue of Rs. 31.45 lacs from sale of old stocks etc. and has incurred a Profit after tax of Rs. 214.45 lacs.

EXPORTS

On account of closure of the manufacturing operations of the Company, there has not been any export during the year. The FOB value of exports during the previous financial year was nil.

FIXED DEPOSITS

The Company had stopped accepting deposits from public. During the year under review, no deposit was claimed for payment. At the end of the financial year, the balance on account of Fixed Deposits accepted from the Public and Members stood at Rs. 25.72 lacs which remained unclaimed/ unpaid. There was no deposit liable to be transferred to the credit of Investors' Education and Protection Fund.

Presently the Company is neither accepting fresh deposits nor renewing the existing ones.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the permanent closure of the Manufacturing Operations, provisions relating to furnishing of the details of (i) Conservation of Energy, (ii) Research & Development and Technology Absorption and (iii) Foreign Exchange Earning and Outgo in accordance with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

DIRECTORS

Mr. Manoj Singh has been appointed as a Nominee Director of UPSIDC Limited w.e.f. 16.08.2012 against the causal vacancy caused due to withdrawal of the nomination of Mr.Mohammad Iftkharuddin who was appointed w.e.f. 07.05.2012 in place of Mr. Devi Shanker Sharma, who was appointed w.e.f. 07.11.2011 in place of Mr. S.K. Verma.

PERSONNEL

Subsequent to the closure of the Manufacturing Operations of the Company, all issues of ex-workmen/employees have been amicably resolved. The total dues of these workmen/ employees (other than 11 workmen who have not yet tendered resignations) have been paid. These ex-workmen/ employees had approached DRT-II, New Delhi seeking order for payment of dues in excess of the legal dues as paid to the other workmen/employees. Hon'ble DRT had directed them to approach the Labour Commissioner for adjudication of their dues. None has approached the Labour Commissioner as directed by DRT. However, as directed by DRT, the Company has deposited the amount payable to them with DRT.

There was no employee, employed for full or part of the year, whose particulars are to be given in terms of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

AUDITORS AND AUDIT REPORT

Messrs P. R. Mehra & Co., Chartered Accountants, New Delhi, the retiring Auditors, being eligible, offer themselves for reappointment.

With reference to the qualifications contained in the Auditors' Report, the Directors wish to state that the Notes on

Accounts and Significant Accounting Policies referred to by the Auditors in their Report are self-explanatory and hence do not call for any further comment.

COST AUDIT

The Central Government had approved the appointments of Messrs N. Dewan & Co., Cost Accountants, New Delhi to conduct the Cost Audit in respect of Nylon & Polyester Filament Yarns for the year ended 31st March, 2007. However, in view of permanent closure of operations, the Company had applied for exemption from the requirement of Cost Audit. Accordingly, their re-appointment is not envisaged.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the 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 Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the Financial year and of the Profit of the Company for that period;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Companies Act, 1956 for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that in view of the permanent closure of the Manufacturing Operations of the Company, the Directors had not prepared the Annual Accounts on a going concern basis.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary Company.

CORPORATE GOVERNANCE

The Report on Corporate Governance together with the Statutory Auditors' Certificate thereon are annexed hereto and forms part of this Report. The Management Discussion and Analysis Report is annexed hereto and forms part of this Report.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of Section 274(1)(g) of the Companies Act, 1956. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 1956 and Clause 49 of the Listing Agreement.

APPRECIATION

Your Directors would like to express their sincere appreciation to the various Departments of the Central and State Governments, UPSIDC's nominee directors and Investors for their continued valuable support and assistance. Your Directors also wish to thank all the Officers and Staff of the Company at all levels for their contribution, support and continued co-operation throughout the year.

For and on behalf of the Board,

New Delhi (M. K. Modi)

16th August, 2012 Chairman & Managing Director

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Mar 31, 2010

The Directors have pleasure in presenting the 43rd Annual Report with Audited Statement of Accounts for the financial year ended 31st March, 2010.

FINANCIAL HIGHLIGHTS

2009-10 2007-09

(18 months)

Rs. Lacs Rs. Lacs

Turnover 33.40 46.71

Other Income 2.84 78.95

Gross Profit (Loss) (570.55) (1,928.05)

Depreciation 1.53 -

Profit/(Loss) after Depreciation (572.08) (1,928.05)

Add: Prior Period Expenses(Net) (8.50) (624.00)

Add/(Less) Exceptional

Income/ (Losses) 548.69 3,140.62

Profit/(Loss) before Tax (31.89) 588.57

Less/(Add) : Provision for Taxation- Fringe Benefit Tax 9.41 5.25

Net Profit/(Loss) after Tax (22.48) 583.32

SCHEME OF ARRANGEMENT

As reported earlier, the Company had, post re-structuring through Slump sale of Chemicals business alongwith certain specified assets, filed a Scheme of Arrangement U/s 391/ 393/394 of the Companies Act, 1956 before Hon’ble Allahabad High Court seeking its approval to the accounting treatment to the direct allotment of shares of IOIL by IOIL to the shareholders of the Company in part discharge of the purchase Consideration. In terms of the Order passed by Hon’ble High Court on 28.01.2008, the meeting of the Shareholders of the Company was convened. The meeting had approved the Scheme of Arrangement with over whelming majority. The matter is now to be listed for final hearing.

CLOSURE OF MANUFACTURING OPERATIONS

As reported earlier, the industrial undertaking of the Company has been permanently closed down after seeking requisite permission from Government of Uttar Pradesh under the provisions of the Uttar Pradesh Industrial Disputes Act, 1947. The Company is now exploring other possibilities so as to have optimal utilization of its real estate.

SETTLEMENT WITH BANKS

In its endeavour to arrive at an amicable One Time Settlement of the outstanding dues of the banks, the Company had earlier finalized settlement with Abu Dhabi Commercial Bank whose dues have been duly paid by the assignee of the debt. Recently Allahabad Bank has also approved One Time Settlement of its dues. The settled dues are being paid by Ashoka Mercantile Ltd.(AML), a Group MKM Company. Debt will be assigned to AML once the entire settled amount is paid. The Company is desirous of liquidating the balance NPA dues of other banks under OTS on the lines of the settlement with Allahabad Bank. The banks had initiated recovery proceedings under SARFESAI Act, 2002 and have sold the Plant & Machinery, Stores & Spares and Structures of the Company which are in the process of being dismantled and removed. This has enabled the Company to reduce its NPA dues by Rs.33.61 crores.

DIVIDEND

In view of the Losses suffered by the Company, your Directors are unable to recommend any Dividend on Equity and Preference Share Capital.

OPERATIONS

During the year under review, the Company registered total revenue of Rs.37.77 lacs from sale of old stocks etc. and has incurred a Loss after tax of Rs. 22.48 lacs.

EXPORTS

On account of closure of the manufacturing operations of the Company, there has not been any export during the year. The FOB value of exports during the previous financial year was nil.

FIXED DEPOSITS

The Company had stopped accepting deposits from public. During the year under review, the Company repaid deposits of Rs. 6.73 lacs out of unclaimed/unpaid deposits. At the end of the financial year, the balance on account of Fixed Deposits accepted from the Public and Members stood at Rs. 25.72 lacs which remained unclaimed/unpaid. There was no deposit liable to be transferred to the credit of Investors’ Education and Protection Fund.

Presently the Company is neither accepting fresh deposits nor renewing the existing ones.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION,

FOREIGN EXCHANGE EARNINGS AND OUTGO

In view of the permanent closure of the Manufacturing Operations, provisions relating to furnishing of the details of (i) Conservation of Energy, (ii) Research & Development and Technology Absorption and (iii) Foreign Exchange Earning and Outgo in accordance with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are not applicable.

DIRECTORS

After the last Annual General Meeting of the Company, there has been only one change in the Board of Directors. Upon withdrawal of nomination, Mr. Ranjeet Singh Pankaj, IAS ceased to be a Director on 30.01.2010.

Mr. O. P. Makkar, Director of the Company is liable to retire on 19th March, 2011 and being eligible for re-appointment, has offered himself for re-appointment. Your Directors recommend his re-appointment.

Mr. S. K. Verma, IAS was appointed as an Additional Director w.e.f. 30th January, 2010.

PERSONNEL

Subsequent to the closure of the Manufacturing Operations of the Company, all issues of ex-workmen/employees have been amicably resolved. The total dues of these workmen/ employees (other than 12 workmen who have not yet tendered resignations) have been paid.

There was no employee, employed for full or part of the year, whose particulars are to be given in terms of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975.

AUDITORS AND AUDIT REPORT

Messrs P. R. Mehra & Co., Chartered Accountants, New Delhi, the retiring Auditors, being eligible, offer themselves for re-appointment.

With reference to the qualifications contained in the Auditors’ Report, the Directors wish to state that the Notes on

Accounts and Significant Accounting Policies referred to by the Auditors in their Report are self-explanatory and hence do not call for any further comment.

COST AUDIT

The Central Government had approved the appointment of Messrs N. Dewan & Co., Cost Accountants, New Delhi to conduct the Cost Audit in respect of Nylon & Polyester Filament Yarns for the year ended 31st March, 2007. However, in view of permanent closure of operations, the Company had applied for exemption from the requirement of Cost Audit. Accordingly, their re-appointment is not envisaged.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the 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 Directors had selected such Accounting Policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the State of Affairs of the Company at the end of the Financial year and of the Loss of the Company for that period;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate Accounting Records in accordance with the provisions of the Companies Act, 1956 for safeguarding the Assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that in view of the permanent closure of the Manufacturing Operations of the Company, the Directors had not prepared the Annual Accounts on a going concern basis.

SUBSIDIARY COMPANIES

The Company does not have any Subsidiary Company.

CORPORATE GOVERNANCE

The Report on Corporate Governance together with the Statutory Auditors’ Certificate thereon are annexed hereto and forms part of this Report. The Management Discussion and Analysis Report is annexed hereto and forms part of this Report.

STATUTORY DISCLOSURES

None of the Directors are disqualified under the provisions of Section 274(1)(g) of the Companies Act, 1956. The Directors have made the requisite disclosures, as required under the provisions of the Companies Act, 1956 and Clause 49 of the Listing Agreement.

APPRECIATION

Your Directors would like to express their sincere appreciation to the various Departments of the Central and State Governments and Investors for their continued valuable support and assistance. Your Directors also wish to thank all the Officers, Staff and Workers of the Company at all levels for their contribution, support and continued co- operation throughout the year.

For and on behalf of the Board,

New Delhi (M. K. Modi)

13th August, 2010 Chairman & Managing Director