Mar 31, 2015
TO THE MEMBERS
The Directors have pleasure in presenting their Report together with
the Audited Accounts for the year ended 31st March, 2015.
FINANCIAL RESULTS
Particulars 2014-15 2013-14
Rs./Lacs Rs./Lacs
Sales and other Income 20658.50 21093.31
Profit before Finance Costs and Depreciation 1080.88 1122.92
Financial Charges 660.66 729.74
Depreciation 402.51 335.50
Profit before Taxes 17.71 57.68
Payment/Provision for Taxation (1.09) 4.75
Profit after Taxation but before
extra-ordinary items 18.80 52.93
Extra-ordinary items - (99.41)
Net Profit after extra-ordinary items 18.80 (46.48)
COMPANY'S PERFORMANCE
During the year under review, although the turnover of the company
marginally declined by 2.06%, the profit before taxes declined to
Rs.17.71 lacs from Rs. 57.68 lacs. The marginal decline in turnover is
mainly attributable to sudden decline in exports. During the year
under review, the company made exports to the tune of Rs. 3666.24 Lacs
as against exports of Rs. 4502.40 Lacs made during previous financial
year showing a decline of 18.57%. The profit before taxes declined
because the company's spinning unit, which was restarted from August
2013 incurred losses during the year. The said unit has started
generating cash profit only from the last quarter of the year under
review.
THE MANAGEMENT DISCUSSION & ANALYSIS
Spinning Unit at Dharuhera, Haryana
The production activities in this unit were re-started from 31.8.2013.
However, due to initial teething troubles, the production activities
could be streamlined in March 2014 but the unit started generating cash
profit only from the last quarter of FY 2014-15. In order to meet the
growing competition in cotton yarn market, the company had decided to
go for value addition by producing doubled yarn, for which the company
decided to procure eight new TFOs and two Cheese Winding machines and
also made advance payment to the supplier. State Bank of Travancore
(SBOT) had also sanctioned a Term Loan of Rs.180 Lacs for purchase of
these machines. However due to delay in obtaining NOC from some of the
consortium member banks, the said loan could not be disbursed. As a
result the machinery supplier diverted the machine to some other
supplier. Since the next delivery period of the machines was very long,
the company decided to procure/import state-of-the-art Circular
Knitting Machine to manufacture fine quality fabric out of cotton yarn
(i.e. forward integration), which will result in better value addition.
SBOT has also approved the change of machine and advance to the
machinery supplier has been made through partial disbursement of loan.
The machines are expected to be ready for delivery by October 2015.
With the addition of the machine, the profitability of the spinning
unit is expected to improve.
Knitting & Garment unit at Dharuhera, Haryana
The production activities of the Fabric/Garment Division at Dharuhera
are going on smoothly. The company is achieving average monthly
turnover of Rs.2 Crore from this unit. The company is supplying
garments for well known brands i.e. Future Group, Reliance Trend,
Pantloon Retail, Spencer and Bharti Wallmart etc. Besides, the company
is also exporting garments.
Sewing Thread Unit At Kala Amb, Himachal Pradesh
During the year under review, the capacity utilisation remained a cause
of concern due to labour shortage problem. Although the company was
able to largely overcome the labour shortage problem from January 2015
but after Holi festival, the situation has again deteriorated. The
situation is gradually improving and it is expected that the situation
will be back to normal by next month. The company has been exporting
significant percentage of its production and more than 90% of the same
was being exported to Turkey. However, due to some internal problem in
Turkey, our exports have virtually stopped during last quarter of the
year under review. Therefore, the company has increased domestic sales
during the same period. However, the realisation period in domestic
sales ranges from 90 days to 120 days, which has created stress on
working capital. The situation is expected to improve gradually once
the realisation cycle is complete. It is not out of place to mention
here that margins in domestic market are better than export market.
DIVIDEND
In view of the requirement of fund for working capital of the company,
the Board of Directors is not in a position to recommend any dividend
for the year under review.
DIRECTOR'S RESPONSIBILITY STATEMENT:
In terms of Section 134 (5) of the Companies Act, 2013, the directors
would like to state that:
i) In the preparation of the annual accounts, the applicable accounting
standards have been followed.
ii) The directors have selected such accounting policies and applied
them consistently and made judgments and estimates that were 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 or
loss of the Company for the year under review.
iii) The directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities.
iv) The directors have prepared the annual accounts on a going concern
basis.
v) The directors had laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and were operating effectively.
vi) The directors had devised proper system to ensure compliance with
the provisions of all applicable laws and that such system were
adequate and operating effectively.
STATUTORY AUDITORS
During the year under review, the auditors need no rotation as they can
continue as auditors for a period of two more years i.e. up the year
2017. M/s. B.K. Shroff & Co. Chartered Accountants, who are the
statutory auditors of the Company, hold office till the conclusion of
the forthcoming AGM and are eligible for re-appointment. Pursuant to
the provisions of Section 139 of the Companies Act, 2013 and the Rules
framed thereunder, it is proposed to appoint M/s. B.K. Shroff & Co. as
statutory auditors of the Company from the conclusion of the
forthcoming AGM till the conclusion of the thirty seventh AGM to be
held in the year 2017, subject to ratification of their appointment at
every AGM.
INTERNAL CONTROL SYSTEMS
Your Company has evolved a system of internal controls to ensure that
the assets are safeguarded and transactions are authorised, recorded
and correctly reported. The internal control system is supplemented by
management reviews and independent periodical reviews by the outside
chartered accountancy firms which evaluate the functioning and quality
of internal controls and provides assurance of its adequacy and
effectiveness. The scope of internal audit covers a wide variety of
operational methods and, as a minimum, ensures compliance with
specified standards with regard to availability and suitability of
policies and procedures, extent of adherence, reliability of management
information system and authorization procedures including steps for
safe- guarding of assets. The reports of internal audit are placed
before Audit Committee of the Directors and Board. Audit Committee and
board reviews such audit findings and the adequacy of internal control
systems. The Statutory Auditors and the Internal Auditors of the
Company also interact with the Audit Committee and Board to share their
findings and the status of corrective actions under implementation.
M/s. M.C. Jain & Co. Chartered Accountants, New Delhi were appointed as
Internal Auditors of the Company for the Financial Year 2014-15 and
their reports for the year were submitted to the Audit Committee and to
the Board.
COST AUDIT
The Central Govt has approved the appointment of M/s Avtar Singh & Co.
as cost auditors for conducting Cost Audit for the Financial Year
2014-15 The report of Cost Auditors in respect of audit of the cost
records of the Company for the year ended 31st March 2015 will be
submitted to the Central Government in due course.
SECRETARIAL AUDIT
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Company has appointed M/s Suchita Gupta &
Co., a firm of Company Secretaries in Practice, to undertake the
Secretarial Audit of the Company. The Report of the Secretarial Audit
is annexed herewith as Annexure-A
AUDITORS' OBSERVATIONS
Auditors' observations relating to Note no. 12 as contained in the Main
Report under the para 'Basis of Qualified Opinion' are explained
hereunder: -
Although, the company has made representation to the competent
authority for payment of compensation at market rate in respect of part
of company's factory land acquired by Government of Haryana, the
company feels that final decision in this regard may take a very long
time and moreover there is uncertainty about the success of company's
representation. Hence, it has been decided that its affect would be
given in company's books as and when actual compensation is received
from Government of Haryana.
DEPOSITS
During the year, the Company did not accept any deposits from the
public within the meaning of Section 73 of the Companies Act, 2013 and
the Companies (Acceptance of Deposits) Rules, 2014.
PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS:
During the year under review , company has not given any loans,
Guarantee or made any investments covered under the provisions of
Section 186 of the Companies Act, 2013.
SUBSIDIARY COMPANIES:
The Company does not have any subsidiary
BUSINESS RISK MANAGEMENT
Pursuant to the requirement of Clause 49 of the Listing Agreement, the
Company has constituted a Risk Management Committee. The details of the
Committee and its terms of reference are set out in the Corporate
Governance Report forming part of the Board's Report. On the
recommendation of the Risk Management Committee, the Board has adopted
Risk Management Policy, which outlines the program implemented by the
Company to ensure appropriate risk management within its system and
culture. The Risk Management Policy is also posted on the website of
the Company. The Company's risk management pro- gram comprises of a
series of processes, structures and guidelines which assist the Company
to identify, assess, monitor and manage its business risks, including
any material changes to its risk profile. To achieve this, the Company
has clearly defined the responsibility and authority of the Company's
Board of Directors and of the Risk Management Committee to oversee and
manage the risk management program while conferring responsibility and
authority on the Company's senior management to develop and maintain
the risk management program in light of the day to day needs of the
Company. Regular communication and review of risk management practices
provide the Company with important checks and balances to ensure the
efficacy of its risk management program.
SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS
There are no significant and material orders passed by the Regulators/
Courts which would impact the going concern status of the Company and
its future operations.
DIRECTORS
(i) Retirement by rotation
In accordance with the provisions of the Companies Act, 2013 and
Articles of Association of the Company, Mrs. Vrinda Jain retires by
rotation and is eligible for reappointment. The brief resume(s) of the
all Directors proposed to be appointed or reap- pointed at the ensuing
AGM, as required in terms of Clause 49 of the Listing Agreement with
the stock exchanges is provided in the annexure(s) to the notice of
Annual General Meeting.
(ii) Resignation of Director:- During the year , Mr. S.K.Chaajer ,
whole Time Director of the company resigned from the Board on
30-6-2014.
(iii) Declarations by Independent Directors
All Independent Directors have given declarations that they meet the
criteria of independence as laid down under Section 149(6) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
(iv) Board Evaluation
In compliance with the provisions of the Companies Act, 2013 and Clause
49 of the Listing Agreement, the Board has carried out an annual
performance evaluation of its own performance, the directors
individually as well as the evaluation of the working of its Nomination
& Remuneration Committee. The manner in which the evaluation has been
carried out has been explained in the Corporate Governance Report.
(v) Nomination & Remuneration Policy
The Board has, on the recommendation of the Nomination & Remuneration
Committee, framed a Policy for selection, appointment and remuneration
of Directors and Key Managerial Personnel. More details of the same are
given in the Corporate Governance Report.
(vi) Board Meetings
During the year, four (4) Board Meetings and four (4) Audit Committee
Meetings were convened and held. The details are given in the Corporate
Governance Report. The intervening gap between the Meetings was within
the period prescribed under the Companies Act, 2013
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
EARNINGS & OUTGO
The information relating to conservation of energy, technology
absorption and foreign exchange earnings & outgo as required under
Section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the
Companies (Accounts) Rules, 2014 is Annexed herewith as Annexure-B.
EXTRACT OF ANNUAL RETURN
The details forming part of the extract of the Annual Return in form
MGT-9 is annexed herewith as Annexure-C
PARTICULARS OF EMPLOYEES
The provisions of Rule 5(2) & (3) of the Companies (Appointment &
Remuneration of Managerial Personnel) Rules, 2014 requiring particulars
of the employees in receipt of remuneration in excess of Rs.60 lacs per
year to be disclosed in the Report of Board of Directors are not
applicable to the Company as none of the employees was in receipt of
remuneration in excess of Rs.60 lacs during the financial year 2014-15.
The information in accordance with the provisions of Section 197 of the
Companies Act,2013 read with rule 5 of the Companies ( Appointment and
Remuneration of Managerial Personnel) Rules 2014 is annexed as
Annexure-D.
CORPORATE GOVERNANCE
The Company has been in compliance with all the conditions of Corporate
Governance as stipulated in Clause 49 of the Listing Agreement with
Stock Exchange and a certificate from the Auditors to this effect is
made part of the Annual Report. Committed to the practice of good
Corporate Governance, the Board lays strong emphasis on transparency,
accountability and integrity, with its 'Governance Committee'
specifically assigned the task of analysing the clause with respect to
good governance practice. In terms of such sub clause (v) of Clause 49
of Listing Agreement, Certificate of CEO/CFO, inter alia, confirming
the correctness of the financial statements, adequacy of the internal
control measures and reporting of matters to the Audit Committee in
terms of the said clause, is also enclosed as a part of said Report.
OBLIGATION OF COMPANY UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE
(PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013
In order to prevent sexual harassment of women at work place a new act
The Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013 has been notified on 9th December, 2013. Under
the said Act every company is required to set up an Internal Complaints
Committee to look into complaints relating to sexual harassment at work
place of any women employee.
Company has adopted a policy for prevention of Sexual Harassment of
Women at workplace and has set up Committee for implementation of said
policy. During the year Company has not received any complaint of
harassment.
ACKNOWLEDGEMENT
Your Directors convey their sincere thanks to the various agencies of
the Central Government, State Governments, Banks and other concerned
agencies for all the help and cooperation extended to the Company. The
Directors also deeply acknowledge the trust and confidence the
shareholders and investors have placed in the Company. Your Directors
also record their appreciation for the dedicated services rendered by
the workers, staff and officers of the Company
For And on Behalf of Board of Directors
Sd/-
Ramesh Kumar Jain
Chairman & Managing Director
Place : New Delhi
Dated : 14-8-2015
Mar 31, 2014
Dear members,
The Directors have pleasure in presenting their Report together with
the Audited Accounts for the year ended 31st March, 2014.
1. FINANCIAL RESULTS
Particulars For the Year For the Year
2013-14 2012-13
(Rs. in Lacs) (Rs. In Lacs)
Sales and other Income 21093.31 15998.31
Profit before Interest
and Depreciation 1122.92 1688.42
Financial Charges 729.74 710.69
Depreciation 335.50 312.77
Profit before Taxes 57.68 664.96
Payment / Provision for Taxation 4.75 126.67
Profit after Taxation but before
extra-ordinary items 52.93 538.29
Extra-ordinary items (99.41) 1457.87
Net Profit after extra-ordinary
items (46.86) 1996.16
2. COMPANY''S PERFORMANCE
During the year under review, although, the turnover of the company
registered a growth of 31.85%, the profit before taxes also declined to
Rs. 57.68 lacs from Rs. 664.96 lacs. During the year under review, the
performance of the company deteriorated mainly due to the following
reasons:
(a) The company had to pay interest to J M Financial Asset
Reconstruction Co. Pvt. Ltd. (JMFARC) on Optionally Convertible
Cumulative Debentures (OCCD), which were earlier to be converted into
Equity. The terms of conversion were linked with the listing of
company''s equity at Bombay Stock Exchange (BSE). Since there was delay
in listing of company''s shares at BSE, the due date of conversion of
OCCD into equity expired and the company had to pay interest since
inception.
(b) During the year under review, the Company suffered loss to the tune
of Rs.115.68 Lacs due to exchange rate fluctuations due to sudden
depreciation of Indian Rupee against USD. Besides, due to depreciation
of Indian rupee against USD, there was significant impact on prices of
our major raw materials (i.e. Polyester, being used for manufacturing
sewing thread at Kala Amb Unit), which is mainly linked with
international market. The company is purchasing the entire requirement
of polyester from Reliance Industries Ltd. and the said company
increased prices of polyester by as much as Rs.19 per kg from April
2013 to August 2013, but the increased cost of production could be
passed on to the customers only by the end of December 2013, which also
adversely affected company''s profitability.
(c) During the year under review, the company continued to face problem
of labour shortage. As a result the company''s sewing thread unit could
not operate at full capacity resulting production losses.
(d) During the year, the company has re-started its Spinning unit at
Dharuhera, which was lying closed since September 2008. In order to
re-start this unit, the company had to incur huge expenditure on
overhauling / repairing of machines / buildings as the plant was lying
close since 2008. Even the company imported and commissioned four new
machines (autoconers) to upgrade the production facilities to enable
the company to produce better quality yarn. As per original schedule,
the production activities were supposed to commence from last week of
June 2013, but due to delay in getting the power connection restored,
the company could commence the production activities from 31 August,
2013. Thereafter due to some teething troubles, the production
activities could not be stabilized till March 2014. Hence instead of
contributing anything to the bottom line, the company suffered
significant loss in this unit.
3. DIVIDEND
In view of the requirement of fund for working capital of the company,
the Board of Directors is not in a position to recommend any dividend
for the year under review.
4. SPECIAL RESOLUTIONS PASSED THROUGH POSTAL BALLOT
No special resolution was passed through postal ballot during the
Financial Year 2013-14. None of the businesses proposed to be
transacted in the ensuing Annual General Meeting require passing of a
special resolution through postal ballot.
5. CORPORATE GOVERENANCE
Your Company is committed to good Corporate Governance Practices and
following to the guidelines prescribed by the SEBI and Stock Exchange
from time to time. The company has implemented all of its major
stipulations as applicable to company. The statutory Auditors''
Certificate dated 27th May, 2014 in accordance with Clause 49 of the
Listing Agreement and report on Corporate Governance is annexed to and
forming part of the Directors'' Report.
6. EMPLOYEES STOCK OPTION PLAN
Your company has not provided any employee stock options.
7. DIRECTORS'' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA)
OF THE COMPANIES ACT, 1956
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, and based on the representations received from the operating
management, the directors hereby confirm that :
i) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures;
ii) the directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company for the period;
iii) the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities; and
iv) the directors had prepared the annual accounts on a going concern
basis.
8. AUDITORS
During the year under review, the auditors need not be routed as they
can continue as auditors for a period of three years i.e. up to the
year 2017. M/s. B.K. Shroff & Co. Chartered Accountants, who are the
statutory auditors of the Company, hold office till the conclusion of
the forthcoming AGM and are eligible for re-appointment. Pursuant to
the provisions of Section 139 of the Companies Act, 2013 and the Rules
framed thereunder, it is proposed to appoint M/s. B.K. Shroff & Co. as
statutory auditors of the Company from the conclusion of the
forthcoming AGM till the conclusion of the thirty sixth AGM to be held
in the year 2017, subject to ratification of their appointment at every
AGM.
9. INTERNAL AUDITORS
M/s. M. C. Jain & Co. Chartered Accountants, New Delhi were appointed
as Internal Auditors of the Company for the Financial Year 2013-14 and
their reports for the year were submitted to the Audit Committee.
10. COST AUDIT
The Central Govt. has approved the appointment of M/s. Avtar Singh &
Co. as cost auditors for conducting Cost Audit for the Financial Year
2013-14 The report of Cost Auditors in respect of audit of the cost
records of the Company for the year ended 31st March 2014 will be
submitted to the Central Government in due course.
11. PARTICULARS OF EMPLOYEES
None of the employees was drawing in excess of the limits as mentioned
by Companies Act, Companies Act, 1956 and rules made thereunder which
needs to be disclosed in the Directors report.
12. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO
Information in accordance with Clause (e) of Sub-Section (1) of Section
217 of the Companies Act, 1956, read with the Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 and
forming part of the Directors Report for the financial year ended 31st
March 2014 is given in the Annexure to this report.
13. INDUSTRIAL RELATIONS
Industrial relations continued to be cordial during the year under
review.
14. CORPORATE GOVERNANCE
The Company has been in compliance with all the conditions of Corporate
Governance as stipulated in Clause 49 of the Listing Agreement with
Stock Exchange and a certificate from the Auditors to this effect is
made part of the Annual Report. Committed to the practice of good
Corporate Governance, the Board lays strong emphasis on transparency,
accountability and integrity, with its ''Governance Committee''
specifically assigned the task of analysing the clause with respect to
good governance practice. In terms of such sub clause (v) of Clause 49
of Listing Agreement, Certificate of CEO/CFO, inter alia, confirming
the correctness of the financial statements, adequacy of the internal
control measures and reporting of matters to the Audit Committee in
terms of the said clause, is also enclosed as a part of said Report.
15. DIRECTORS
Mr. Vidit Jain is the director who retires by rotation and being
eligible, offers himself for reappointment at the ensuing Annual
General Meeting. The brief resume(s) of the all Directors proposed to
be appointed or reappointed at the ensuing AGM, as required in terms of
Clause 49 of the Listing Agreement with the stock exchanges is provided
in the annexure(s) to the notice of Annual General Meeting.
16. DEPOSITS
During the year, the Company did not accept any deposits from the
public within the meaning of Section 58A of the Companies Act, 1956.
17. AUDITORS'' OBSERVATIONS
Auditors'' observations relating to Note No. 12 as contained in the Main
Report under the para ''Basis of Qualified Opinion'' are explained
hereunder:
Although, the company has made representation to the competent
authority for payment of compensation at market rate in respect of part
of company''s factory land acquired by Government of Haryana, the
company feels that final decision in this regard may take a very long
time and moreover there is uncertainty about the success of company''s
representation. Hence, it has been decided that its affect would be
given in company''s books as and when actual compensation is received
from Government of Haryana.
18. ACKNOWLEDGEMENT
The Directors wish to convey their appreciation to Customers,
Suppliers, Bankers, other Stakeholders and specially the employees for
their co-operation. The Directors also appreciate the confidence
reposed in the Management of the Company by its shareholders.
For and on behalf of Board of Directors
For PASUPATI SPINNING & WEAVING MILLS LIMITED
Sd/-
Place : New Delhi RAMESH KUMAR JAIN
Dated : May 27, 2014 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2013
TO THE MEMBERS
The Directors have pleasure in presenting their Report together with
the Audited Accounts for the year ended 31st March, 2013.
FINANCIAL RESULTS
Particulars For the Year For the Year
2012-13 2011-12
(Rs. in Lacs) (Rs. In Lacs)
Sales and other Income 15998.31 11431.47
Profit before Interest and Depreciation 1688.42 1272.98
Financial Charges 710.69 840.28
Depreciation 312.77 311.99
Profit before Taxes 664.96 120.71
Payment / Provision for Taxation 126.67* 0.10
Profit after Taxation but before
extra-ordinary items 538.29 120.61
Extra-ordinary items 1457.87 0.11
Net Profit after extra-ordinary items 1996.16 120.72
* Includes provision for Deferred Tax Liability of Rs.126.64 Lacs.
OPERATIONS
During the year under review, the turnover of the company registered a
growth of 39.95%. The profit before taxes also jumped to Rs. 664.96
lacs from Rs. 120.71 lacs. The improvement of results has been mainly
due to the cotton yarn business, which the company is outsourcing on
job work basis from outside. However, the operations of sewing thread
unit remained below expected level mainly due to labour shortage during
the year. Although the company is trying its level best to improve the
same, the position still remains critical. In view of improved market
of cotton yarn, the company proposes to restart production activities
of its Spinning Unit at Dharuhera, where the production activities were
suspended due to bad market scenario and frequent power problems. In
order to upgrade its production facilities for producing quality yarn,
the company has placed order for import of four new machines with
financial assistance of Rs. 452 Lacs sanctioned by Bank of Baroda. The
first shipment of two machines has already arrived in India. Barring
unforeseen circumstances, production activities in spinning unit are
expected to commence from Mid-June 2013. With the resumption of
spinning unit, the turnover and profitability of the company is
expected to improve further. The operations of company''s knitting and
garment unit at Dharuhera have remained smooth during the year.
DIVIDEND
In view of the requirement of fund for working capital of the company,
the Board of Directors is not in a position to recommend any dividend
for the year under review.
DIRECTORS'' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA) OF
THE COMPANIES ACT, 1956 :
Your Directors hereby confirm that :
i) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures;
ii) the directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company for the period;
iii) the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
iv) the directors had prepared the annual accounts on a going concern
basis.
AUDITORS
M/s. B. K. Shroff & Co., Chartered Accountants, auditors of the
Company, holds office until the conclusion of the ensuing Annual
General Meeting. Based on the recommendation of the Audit Committee,
the Board of Directors proposes to the reappointment of M/s. B. K.
Shroff & Co., Chartered Accountants, as the Statutory Auditors of the
Company from the conclusion of this Annual General Meeting till the
conclusion of the next Annual General Meeting.
M/s. B. K. Shroff & Co., Chartered Accountants, have expressed their
willingness to act as Statutory Auditors of the Company, if
reappointed, and have further confirmed that the said reappointment
would be in conformity with the provisions of Section 224 (IB) of the
Companies Act, 1956.
INTERNAL AUDITORS
M/s. M. C. Jain & Co., Chartered Accountants, New Delhi were appointed
as Internal Auditors of the Company for the Financial Year 2012-2013
and their reports for the year were submitted to the Audit Committee.
COST AUDIT
The Central Government has approved the appointment of M/s. Avtar Singh
& Company as Cost Auditors for conducting Cost Audit for the Financial
Year 2012-2013.
The report of Cost Auditors in respect of audit of the cost records of
the Company for the year ended 31st March 2013 will be submitted to the
Central Government in due course.
PARTICULARS OF EMPLOYEES
There is no employee in the Company whose particulars are required to
be given under Section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975, as amended.
INDUSTRIAL RELATIONS
Industrial relations continued to be cordial during the year under
review.
STATEMENT PURSUANT TO LISTING AGREEMENT(S)
The Company''s securities are listed at Mumbai Stock Exchange & Delhi
Stock Exchange and the Company has paid Annual Listing Fee to Bombay
Stock Exchange for the year under review & for the current year.
CORPORATE GOVERNANCE
The Company has been in compliance with all the conditions of Corporate
Governance as stipulated in Clause 49 of the Listing Agreement with
Stock Exchange and a certificate from the Auditors to this effect is
made part of the Annual Report. Committed to the practice of good
Corporate Governance, the Board lays strong emphasis on transparency,
accountability and integrity, with its ''Governance Committee''
specifically assigned the task of analysing the clause with respect to
good governance practice. In terms of such sub clause (v) of Clause 49
of Listing Agreement, Certificate of CEO / CFO, inter alia, confirming
the correctness of the financial statements, adequacy of the internal
control measures and reporting of matters to the Audit Committee in
terms of the said clause, is also enclosed as a part of said Report.
DIRECTORS
Shri Vidit Jain & Shri S. K. Chhajer are the directors who retire by
rotation and being eligible, offer themselves for reappointment at the
ensuing Annual General Meeting. The brief resume of the said Directors,
as required in terms of Clause 49 of the Listing Agreement with the
stock exchanges, is provided in the annexure to the notice of Annual
General Meeting. The details of the different Committees of the Board
of Directors are provided in the report on Corporate Governance annexed
to the annual report.
DEPOSITS
During the year, the Company did not accept any deposits from the
public within the meaning of Section 58A of the Companies Act, 1956.
AUDITORS'' OBSERVATIONS
The Auditors'' observations regarding Note Nos. 4 (v) (c), 12, 22,
(37(b) and 37(c) have been suitably explained in accompanying notes to
the Financial Statements. The same are however again explained
hereunder :
Note 4 (v) (c)
Debt of Rs. 600 lacs was to be converted into Optionally Cumulative
Convertible Debentures (OCCD). The OCCD was to be converted into fully
paid up equity shares of Rs. 10 each at a price of Rs. 40 per share in
3 stages over a time frame of 18-30 months from the effective date i.e.
19.03.2010 subject to other terms and conditions which includes that in
case the conversion does not take place in the respective stages, then
the OCCD will be converted at the end of next stage except in case of
stage 3, post which it will have to be compulsorily redeemed by the
company alongwith accumulated interest which accrue monthly at 23% p.a.
Due to certain unavoidable circumstances, OCCDs could not be issued
within 30 months from the effective date and in view thereof, the
company has approached JMFARC for payment of the OCCD amount with
interest. The negotiations are still in progress and hence the amount
to be paid is not yet finalized. In the meantime the company has paid /
provided interest of Rs. 41929315 (Rs. 28129315 for the period from
19.03.2010 to 31.03.2012 which has been included under extra ordinary
items and Rs.13800000 for the period from 01.04.2012 to 31.03.2013
which has been included in interest expense for the year) @ 23% p.a.
Difference if any, will be accounted after finalisation of
negotiations.
Note 12
Although, the company has made representation to the competent
authority for payment of compensation at market rate in respect of part
of company''s factory land acquired by Government of Haryana, the
company feels that final decision in this regard may take a very long
time and moreover there is uncertainty about the success of company''s
representation. Hence, it has been decided that its affect would be
given in company''s books as and when actual compensation is received
from Government of Haryana.
Note 22
The company had provided the excise duty demands in earlier years in
its books of accounts for which matter is sub-judice in various courts.
The company has been advised that no liability is likely to arise
against the demands; hence the provision is not required. Therefore,
the management decided to write back such provision. The same has
however been shown under the head ''Contingent Liabilities''.
Note (37(b) and 37(c)
The company has already applied to Central Government for necessary
permission for payment of remuneration to Directors.
ADDITIONAL INFORMATION
Energy conservation measures, progress made in technology absorption
and foreign exchange earning and outgo, as required by the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rule, 1988 is annexed and form part of this Report.
ACKNOWLEDGEMENT
The Directors wish to place on record their appreciation to employees
at all levels for their hard work, dedication and commitment. The
Directors also take this opportunity to thank all investors, clients,
vendors, bankers, regulatory and Government authorities and stock
exchanges for their continued support.
For and on behalf of Board of Directors
For PASUPATI SPINNING & WEAVING
MILLS LIMITED
Sd/-
Place : New Delhi RAMESH KUMAR JAIN
Dated : May 27, 2013 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2012
TO THE MEMBERS
The Directors have pleasure in presenting their Report together with
the Audited Accounts for the year ended 31st March, 2012.
FINANCIAL RESULTS
For the Year For the Year
2011-12 2010-11
(Rs. in Lacs) (Rs. In Lacs)
Sales and other Income 11431.47 11075.70
Profit before Interest and Depreciation 1272.98 1484.49
Financial Charges 840.28 870.23
Depreciation 311.99 306.67
Profit before Taxes 120.71 307.59
Payment/ Provision for Taxation 0.10 -
Profit after taxation but before
extra-ordinary items 120.61 307.59
Extra-ordinary Items 0.11 0.04
Net profit after extra ordinary items 120.72 307.63
OPERATIONS
During the year under review, the net profit of the company after
depreciation and before tax has decreased to Rs. 120.71 Lacs as
compared to profit of Rs. 307.59 Lacs of previous year as the margins
were adversely affected due to rise in input costs (mainly Raw
Materials). Company is trying to improve profitability by increasing
sales of Sewing Thread (Finished Product) in local market. The Company
is in the process for getting approval from various Overseas Vendors
for using Pasupati Thread in their products.
RECENT DEVELOPMENTS
Capital Reduction by 60%
The Company was declared a sick company by the BIFR on 14.07.2005 and
Bank of Baroda was appointed as the operating agency (OA) under Section
17 (3) of the Sick Industrial Companies (Special Provisions) Act, 1985.
The Hon'ble Bench of BIFR finally sanctioned Rehabilitation Scheme vide
its order dated 17.02.2012. Pursuant to the terms of Rehabilitation
Scheme as approved by the Hon'ble BIFR, the company reduced its share
capital by 60% i.e. from Rs. 5,70,65,060/- (Rupees Five Crores Seventy
Lacs Sixty Five Thousand and Sixty only) to Rs. 2,28,26,020/- (Rupees
Two Crores Twenty Eight Lacs Twenty Six Thousand and Twenty only) and
thereafter consolidated into 2372602 equity shares comprising of
2222602 fully paid up shares of Rs. 10/- each and 150,000 partly paid
up shares of Rs. 10 each, by passing special resolution in its Extra
Ordinary General Meeting duly held on 13.02.2012.
As on 31.03.2012, the total Paid up share capital of the Company stands
as Rs. 2,37,26,020/- divided into 2372602 equity share of Rs. 10 each.
Full & Final Settlement of 14%, / 15% Redeemable Partly Convertible
Debentures and 19% Debentures
The Hon'ble BIFR has also directed that all the debenture-holders shall
be paid 75% of out standing amount in full and final settlement of all
their claims and such amount shall be paid in 24 equal monthly
installments with the complete waiver of entire simple interest, penal
interest, compound interest, liquidated damages and any other charges
of whatsoever nature and 25% of the outstanding principal amount.
Accordingly, the company has already started paying the dues of all
debenturholders as per the directions of BIFR.
DIVIDEND
In view of the requirement of fund for working capital of the company,
the Board of Directors is not in a position to recommend any dividend
for the year under review.
DIRECTORS' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA) OF
THE COMPANIES ACT, 1956 :
Your Directors hereby confirm that :
i) in the preparation of the annual accounts, the applicable accounting
standards had been followed along with proper explanation relating to
material departures.
ii) the directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company for the period.
iii) the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities.
iv) the directors had prepared the annual accounts on a going concern
basis.
COST AUDIT
The Central Govt. has approved the appointment of M/s Avtar Singh &
Company as cost auditors for conducting Cost Audit for the Financial
Year 2011-12.
The report of Cost Auditors in respect of audit of the cost records of
the Company for the year ended 31st March 2012 will be submitted to the
Central Government in due course.
AUDITORS
M/s. B.K. Shroff & Co., Chartered Accountants, auditors of the Company,
hold office until the conclusion of the ensuing Annual General Meeting.
Based on the recommendation of the Audit Committee, the Board of
Directors proposes to the reappointment of M/s. B.K. Shroff & Co.,
Chartered Accountants, as the Statutory Auditors of the Company from
the conclusion of this Annual General Meeting till the conclusion of
the next Annual General Meeting.
M/s. B.K. Shroff & Co., Chartered Accountants, have expressed their
willingness to act as Statutory Auditors of the Company, if
reappointed, and have further confirmed that the said reappointment
would be in conformity with the provisions of Section 224 (IB) of the
Companies Act, 1956.
PARTICULARS OF EMPLOYEES
There is no employee in the Company whose particulars are required to
be given under Section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975, as amended.
INDUSTRIAL RELATIONS
Industrial relations continued to be cordial during the year under
review.
STATEMENT PURSUANT TO LISTING AGREEMENT (S)
The Company's securities are listed at Mumbai Stock Exchange & Delhi
Stock Exchange and the Company has paid Annual Listing Fee to Bombay
Stock Exchange for the year under review & for the current year.
CORPORATE GOVERNANCE
The report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement forms part of the Annual Report.
The requisite Certificate from the Auditors of the Company confirming
compliance with the conditions of Corporate Governance as stipulated
under the aforesaid clause 49, is attached to this report.
DIRECTORS
Shri Ashwani Kumar Rathore was co-opted as director on the Board of the
company w.e.f. 25.02.2012 as an additional director.
Shri Praveen Paliwal is the director, who retires by rotation and being
eligible, offers himself for reappointment at the ensuing Annual
General Meeting.
AUDITORS' REMARKS
The Auditors' observations regarding Note Nos. 3, 4(v)(b), 4(v)(c),
4(vi)(g), 11, 30(b) and 32 have been suitably explained in accompanying
Notes to the Notes to the Financial Statements. The same are however
again explained hereunder :
Note 3 The explanation given is self explanatory, hence does not call
for further comments.
Notes 4(v)(b) and (c) SASF(IDBI) had assigned its outstanding debt in
favour of J M Financial Asset Reconstruction Company Private Limited
(JMFARC) on 19th March 2010. Subsequently, JMFARC agreed to restructure
the said debt on certain terms and conditions, which have already been
approved by BIFR in the sanctioned scheme. As per the scheme, Rs. 4
Crore will be converted into equity and balance of Rs. 6 Crore will be
converted into Optionally Cumulative Convertible Debentures, which in
turn will also be converted into equity. Hence, the company feels that
provision of interest is not required to be made in accounts.
Similarly, the proposed waiver of Rs. 6.45 Crore by JMFARC will be
given effect in company's accounts only on full implementation of
Rehabilitation Scheme sanctioned by BFIR.
Note 4(vi)(g)
As per the scheme sanctioned by BIFR, the dues of debenture holders are
to be settled at 75% of the principal amount to be paid in 24 equal
monthly instalments. In view of the scheme sanctioned by BIFR, no
provision of interest liability has been made in accounts.
Note 11
Although, the company has made representation to the competent
authority for payment of compensation at market rate in respect of part
of company's factory land acquired by Government of Haryana, the
company feels that final decision in this regard may take a very long
time and moreover there is uncertainty about the success of company's
representation. Hence, it has been decided that its affect would be
given in company's books as and when actual compensation is received
from Government of Haryana.
Note 30(b)
The company has already applied to Central Government for necessary
permission for payment of remuneration to Directors.
Note 32
The company's Rehabilitation Scheme has been sanctioned by BIFR vide
its order dated 17.02.2012. The company has already started
implementing the said scheme and on full implementation of the said
scheme, the company's net worth will become positive. Therefore, the
company has rightly prepared its accounts on the assumption that the
company is a going concern.
ADDITIONAL INFORMATION
Energy conservation measures, progress made in technology absorption
and foreign exchange earning and outgo, as required by the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rule, 1988 is annexed and form part of this Report.
ACKNOWLEDGEMENT
Your Directors wish to place on record their deep appreciation of the
continued support and co- operation received from Banks, Central and
State Governments, dealers, customers, vendors, members, executives,
staff and workers of the company during the year under review.
For and on behalf of Board of Directors
Sd/-
Place : New Delhi RAMESH KUMAR JAIN
Dated : 30th May, 2012 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2011
The Directors have pleasure in presenting their Report together with
the Audited Accounts for the year ended 31st March, 2011.
FINANCIAL RESULTS
For the Year For the Year
2010-11 2009-10
(Rs. in Lacs) (Rs. In Lacs)
Sales and other Income 11075.73 8896.92
Profit before Interest and Depreciation 1389.89 285.38
Financial Charges 775.63 395.67
Depreciation 306.67 310.36
Profit / (Loss) before Taxes 307.59 (420.65)
Payment / Provision for Taxes - (165.80)
Profit / (Loss) after taxation but
before extra-ordinary items 307.59 (254.85)
Extra-ordinary Items 0.04 0.04
Net profit after extra ordinary items 307.63 (254.81)
FINANCIAL HIGHLIGHTS
During the year under review, the net profit of the company after
depreciation and before tax has increased to Rs. 307.59 Lacs as
compared to loss of Rs 420.65 Lacs of previous year. Profit after extra
ordinary items for the financial year 2010-11 stood at Rs. 307.63 Lacs
as against loss of Rs. 254.81 Lacs of previous year.
OPERATIONS
General working of the company is satisfactory. However, profit margin
of company effected due to rise in Input costs (Including Raw Material,
Power, Employees Cost) Company is trying to improve profitability by
increasing sales of Sewing Thread (Finished Product) in local market.
The Company is in process for getting approval from various Overseas
Vendors for using Pasupati Thread in their products. Presently, we are
approved by GAP, Mother Care, C & A , Next and Tommy Hillfiger etc. We
are expecting more approval from various other vendors shortly.
The Company is hopeful to increase sales in domestic market of their
sewing thread by 20% during the year 2011-12.
REFERRING THE COMPANY TO BOARD FOR INDUSTRIAL & FINANCIAL
RECONSTRUCTION
As mentioned in the last years report, the Company has already been
declared a Sick Unit u/s 3 (1) (o) of the Sick Industrial Companies
(Special Provisions) Act, 1985 on 14.07.2005. The requisite proceedings
for the restructuring of the company are in process with BIFR.
DIVIDEND
In view of the requirement of fund for working capital of the company,
the Board of Directors is not in a position to recommend any dividend
for the year under review.
DIRECTORSÃ RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA) OF
THE COMPANIES ACT, 1956 :
Your Directors hereby confirm that :
i) in the preparation of the annual accounts, the applicable accounting
standards have been followed along with proper explanation relating to
material departures;
ii) the directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company for the period;
iii) the directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the company and
for preventing and detecting fraud and other irregularities;
iv) the directors have prepared the annual accounts on a going concern
basis.
COST AUDIT
The report of Cost Auditors in respect of audit of the cost records of
the Company for the year ended 31st March 2011 will be submitted to the
Central Government in due course.
AUDITORS
M/s. B. K. Shroff & Co., Chartered Accountants, auditors of the
Company, hold office until the conclusion of the ensuing Annual General
Meeting. Based on the recommendation of the Audit Committee, the Board
of Directors proposes to the reappointment of M/s. B. K. Shroff & Co.,
Chartered Accountants, as the Statutory Auditors of the Company from
the conclusion of this Annual General Meeting till the conclusion of
the next Annual General Meeting.
M/s. B. K. Shroff & Co., Chartered Accountants, have expressed their
willingness to act as Statutory Auditors of the Company, if
reappointed, and have further confirmed that the said reappointment
would be in conformity with the provisions of Section 224 (IB) of the
Companies Act, 1956.
PARTICULARS OF EMPLOYEES
There is no employee in the Company whose particulars are required to
be given under section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975, as amended.
INDUSTRIAL RELATIONS
Industrial relations continued to be cordial during the year under
review.
STATEMENT PURSUANT TO LISTING AGREEMENT (S)
The CompanyÃs securities are listed at Bombay Stock Exchange Ltd. &
Delhi Stock Exchange and the Company has paid Annual Listing Fee to
Bombay Stock Exchange for the year under review & for the current year.
CORPORATE GOVERNANCE
A report on the implementation of Corporate Governance is enclosed
which forms a part of Directorsà Report.
DIRECTORS
Shri Ghanshyam Dass Gupta was co-opted as director on the Board of the
company w.e.f 21.07.02011.
AUDITORSÃ REMARKS
The Auditorsà observations regarding Note Nos. 4, 5(ii), 5(iii), 6(g),
8, and 22 have been suitably explained in Notes to the Accounts
(Schedule 21). The same are however again explained hereunder :
Note 4
The company is registered with BIFR and its Draft Rehabilitation Scheme
(DRS) has already been approved by all the secured lenders and
submitted to BIFR for final circulation / orders, hence the company is
on the path of revival. Therefore, the company has rightly prepared its
accounts on the assumption that the company is a going concern.
Notes 5(ii) and 5(iii)
SASF(IDBI) had assigned its outstanding debt in favor of J M Financial
Asset Reconstruction Company Private Limited (JMFARC) on 19th March
2010. Subsequently, JMFARC agreed to restructure the said debt on
certain terms and conditions, which are subject to approval by BIFR. In
case, BIFR does not approve the scheme, the interest liability will
arise on Rs. 10 crore proposed to be converted into Equity / Optionally
Cumulative Convertible Debentures. Similarly, the proposed waiver of
Rs. 6.45 Crore by JMFARC is also subject to approval by BIFR. Since
both are contingent in nature, the company has rightly not given any
financial impact of these transactions in the accounts.
Note 6(g)
The company has settled dues of more than 96% of secured lenders. Under
the proposed DRS submitted to BIFR, dues of debenture-holders are
proposed to be settled on the same terms as offered to majority of the
lenders, therefore no provision of interest liability has been made in
accounts.
Note 8
The explanation given is self explanatory, hence does not call for
further comments.
Note 22
The company has already applied to Central Government for necessary
permission for payment of remuneration to Directors.
ADDITIONAL INFORMATION
Energy conservation measures, progress made in technology absorption
and foreign exchange earning and outgo, as required by the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rule, 1988 is annexed and form part of this Report.
ACKNOWLEDGEMENT
Your Directors wish to place on record their deep appreciation of the
continued support and co- operation received from J. M. Financial Asset
Reconstruction Company Private Limited, Banks, Central and Statement
Governments, dealers and customers of the Company.
For and on behalf of
The Board of Directors
Place : New Delhi RAMESH KUMAR JAIN
Dated : 2nd September, 2011 CHAIRMAN & MANAGING DIRECTOR
Mar 31, 2010
The Directors present their Report together with the Audited Accounts
for the year ended 31st March, 2010.
FINANCIAL RESULTS:
For the Year For the Year
2009-10 2008-09
(Rs. in Lacs) (Rs. In Lacs)
Sales & Other Income 8896.62 10331.15
Profit before Interest and Depreciation 285.38 505.47
Financial Charges 395.67 673.20
Depreciation 310.36 371.30
(Loss) / Profit before Taxes (420.65) (539.04)
Payment / Provision for Taxes (165.80) 189.12
(Loss) / Profit after Taxation but
before extra-ordinary items (254.85) (728.16)
Extra-ordinary items 0.04 7515.18
Impairment of Fixed Assets - (802.22)
Net (Loss) / Profit after extra ordinary items(254.81) 5984.80
OPERATIONS :
During the year under review, your company achieved Sales Turnover of
Rs. 8896.62 Lacs as against Rs. 10331.15 Lacs in the previous year. The
turnover is lower as production activities of companys EOU unit at
Dharuhera remained suspended during the year, which was partly
operational in previous year. However the turnover of Sewing Thread
Unit has gone up from Rs. 7110.33 Lacs to Rs. 7451.28 Lacs showing a
marginal increase of about 5%. The company incurred Net loss (before
extra-ordinary items) of Rs. 254.85 Lacs as against loss of Rs. 728.16
Lacs during the previous year.
The working of our Sewing Thread unit during the year 2009-10 has
improved marginally. Tha company is continuously trying to shift its
production base to more value added items, which has started yielding
favourable results. The export realisation has also started improving
due to overall improvement in international scenario. The full impact
of the same should be visible in companys performance during 2011-12.
However, recently the capacity utilization has been adversely affected
due to labour shortage. The company is trying its level best to
overcome this problem by participating in jobfairs and also by
recruiting apprentice / trainees.
The production activities at companys EOU unit at Dharuhera remained
suspended during the year. However, knitting and garments unit at
Dharuhera is working smoothly and improving every month. We are now
supplying garments for various reputed brands like Big Bazar,
Pantaloon, Reliance Retail, Le Coopers etc.
SETTLEMENT WITH FINANCIAL INSTITUTIONS :
SASF(IDBI), the only major term lender has assigned its outstanding
debt in favour of J.M. Financial Asset Reconstruction Company Private
Limited (JMFARC) on 19th March 2010. Further, JMFARC has also agreed in
principle to restructure the outstanding debt on certain terms and
conditions, which are subject to approval by BIFR.
REFERRING THE COMPANY TO BOARD FOR INDUSTRIAL & FINANCIAL
RECONSTRUCTION (BIFR):
As mentioned in the last years report, the Company was declared a sick
industrial company within the meaning of Section 3 (1) (o) of the Sick
Industrial Companies (Special Provisions) Act, 1985 on 14.07.2005 and
Bank of Baroda was appointed as operating agency (OA) to examine
viability of the company and formulate rehabilitation scheme. OA has
since completed its examination and also submitted a Draft
Rehabilitation Scheme to BIFR for its approval.
DIVIDEND:
In view of non-availability of distributable profits, the Board of
Directors is not in a position to recommend any dividend for the year
under review.
DIRECTORS RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217 (2AA) OF
THE COMPANIES ACT, 1956:
Your Directors hereby confirm that:
i) in the preparation of the annual accounts, the applicable
accounting, standards had been followed along with proper explanation
relating to material departures.
ii) the directors had selected such accounting policies and applied
them consistently and made judgements and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company for the period.
iii) the directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the "company and
for preventing and detecting fraud and other irregularities.
jv) the directors had prepared the annual accounts on a going concern
basis.
INDUSTRIAL RELATIONS:
Industrial relations continued to be cordial during the year under
review.
STATEMENT PURSUANT TO LISTING AGREEMENTS):
The Companys securities are listed at Bombay Stock Exchange & Delhi
Stock Exchange and the Company has paid Annual Listing Fee to Bombay
Stock Exchange for the year under review & for the current year.
CORPORATE GOVERNANCE:
A report on the implementation of Corporate Governance is enclosed
which forms a part of Directors Report.
DIRECTORS:
Shri Praveen Paliwal was co-opted as Director on the Board of the
Company with effect from 18.05.2009.
Shri Deepak Gupta (IDBI Nominee) ceased to be a Director of the Company
with effect from 23.09.2009 as his nomination was withdrawn by IDBI.
The Directors place on record their appreciation for the valuable
services rendered by him during his tenure.
Shri Vidit Jain was co-opted as Director on the Board of the Company
with effect from 01.04.2010 and also appointed as Executive Director.
AUDITORS REMARKS :
The observations as referred to in the Auditors Report are
self-explanatory and, therefore, do not call for any further comments.
ADDITIONAL INFORMATION :
Energy conservation measures, progress made in technology absorption
and foreign exchange earning and outgo, as required by the Companies
(Disclosure of Particulars in the Report of the Board of Directors)
Rule, 1988 is annexed and form part of this Report.
ACKNOWLEDGEMENT :
Your Directors wish to place on record their deep appreciation of the
continued support and cooperation received from All India Financial
Institutions, Banks, Central and Statement Governments, dealers and
customers of the Company.
For and on behalf of
The Board of Directors
PLACE : NEW DELHI RAMESH KUMAR JAIN
DATED : SEPTEMBER 04, 2010 CHAIRMAN & MANAGING DIRECTOR
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