Your Directors have pleasure in presenting their 21st Annual Report for the year endedon 31st March 2014.
The performance of the Company for the financial year ended March 31 2014 issummarized below:
|PARTICULARS ||2013-14 ||2012-13 |
|Total Income ||2249.47 ||2594.75 |
|Usual Working Expenses ||3580.77 ||3551.66 |
|Gross Profit/(Loss)before Interest and Depreciation ||(1331.30) ||(956.91) |
|Less: Interest ||5342.90 ||4186.64 |
|Depreciation ||1497.46 ||1503.65 |
|Profit /(Loss)Before Tax ||(8171.66) ||(6647.20) |
|Less: Provision for Current Tax ||- ||- |
|Provision for Deferred Tax ||- ||- |
|Provision for Fringe Benefit Tax ||- ||- |
|Profit /(Loss)After Tax before Extra Ordinary & Exceptional Items ||(8171.66) ||(6647.20) |
|Less : Exceptional Items ||- ||- |
|Profit /(Loss)After Tax & After Extra Ordinary Items ||(8171.66) ||(6647.20) |
|before Exceptional Items || || |
|Add : Extra Ordinary Items ||- ||- |
|Profit /(Loss)After Tax & After Extra Ordinary & Exceptional Items ||(8171.66) ||(6647.20) |
|Add : Balance brought forward from last Year ||- ||- |
|Balance Transferred to Balance Sheet ||(8171.66) ||(6647.20) |
Results of Operations
During the year under review sale has been reduced to Rs. 2241.75 lacs from Rs. 2587.50Lacs. Company has started receiving orders gradually. But still orders are very lesscomparing to production capacity of the Company. Management is constantly focused onmarketing. Due to lack of funds and lower orders the growth in Company's sale isrestricted.
Company has not been able to sale the Fabric of Premium Quality due to lack of demand.Premium quality fabric gives higher margins. Under utilization of capacity accompaniedwith higher debt cost lower margins have resulted into the loss of Rs. 8171.66 lacs(before Extra Ordinary Item) as against the net loss of Rs. 6647.20 Lacs in previous year.
During the year under review the Company has not earned profit hence your Board ofDirectors' do not recommend any dividend for the year.
During the year under review the Company has not raised any amount by way of FixedDeposits.
During the year industrial relations have been cordial.
In accordance with the provision of section 152 of Company Act 2013 read withCompanies (Management & Administration) Rules 2014 Mrs. Rama Jawahar Swetta Directorof the Company retires by rotation and being eligible has offered herself forreappointment at the ensuing Annual General Meeting.
In terms of provision of Section 149 & 152 of Companies Act 2013 which becomeeffective from 1st April 2014 an Independent Director of a Company can be appointed for aterm of five consecutive years and shall not be liable to retired by rotation.
To comply with above provision it is proposed to appoint Mr. Dhananjay Charane Mr.Manohar Dudhane as Independent Director of the Company for a period up to 31st March 2016who shall not be liable to retire by rotation. Your board recommends their appointments.
The Company has received declaration from all the Independent Directors of the Companyconforming that they meet the criteria of Independence as prescribed both under sub-sec.149 of the Companies Act 2013 and under clause 49 of the listing agreement with the stockexchange.
During the year Mr. Abhishek Mohite Mr. Yashawant Shilalkar Mr. Manohar Kanitkar hasresigned from their post of Director and Mr. Manohar Dudhane was appointed as anIndependent Director.
In order to maintain high standards of Corporate Governance and to be complied with theprovisions of clause 49 of Listing Agreement the Company has formed following committees :
I. Audit Committee: The primary objective of Audit Committee is to monitor andeffectively supervise the Company's financial reporting process with a view to provideaccurate timely and proper disclosures and to maintain integrity and quality of financialreporting. Its Constitution activities of this committee has been elaborated in thereport of Corporate Governance. Report on Corporate Governance along with AuditorsCertificate on Compliance with the conditions of Corporate Governance as stipulated inclause 49 of listing agreement is provided elsewhere in the Annual Report.
II. Share Transfer and Investor Grievance Committee : The Board of Directors' hasconstituted "Share Transfer and Investor Grievance Committee" to look after allthe works relating to shares and shareholders grievance i.e. approval oftransfer/transmission/demat/remat of shares issue of duplicate splitupconsolidation renewal of share certificate non receipt of balance sheet non receipt ofdeclared dividends etc. Its constitution and activities have been elaborated in the reportof Corporate Governance.
III. Remuneration Committee : The Board of Directors has constituted"Remuneration Committee" to decide and approve the terms and conditions forappointment of Executive Directors of the Company and remuneration payable to otherDirectors and Executives of the Company and other matters related thereto. Itsconstitution activities of this committee have been elaborated in the report of CorporateGovernance.
Auditors Qualification In Audit Report
Regarding the qualification of Auditor in Audit report Directors' state as under
Point No. [ix] a) & b) : Due to low turnover lower capacity utilization withhigher debt cost the Company is facing liquidity problem and hence there is non payment of statutory dues in time. The Company is taking necessary steps to pay off itsstatutory dues.
Point No. [x] : Due to lower capacity utilization higher debt cost and lowermargin the Company has incurred cash loss of Rs. 6674.22 lacs.
Point No. [xi] : The lower sale and high fixed cost has adversely affected theliquidity/cash flows of the Company resulting into delay in payment ofInterest/Installments to Banks. The Company is exploring different ways of reducing thedebt burden.
Directors' Responsibility Statement
Pursuant to requirement in respect to Directors' Responsibility Statement it is herebyconfirmed that:
i. In preparation of the annual audited accounts the applicable accounting standardshave been followed as per the requirement set out under Schedule VI of the Company Act1956 and that there are no material departures from the same;
ii. The Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company as at March 31 2014 and of the Loss ofthe Company for the year ended on that date.
iii. The Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 1956for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities; and
iv. The Directors have prepared the annual accounts of the Company on a 'Going Concern'basis.
Particulars of Employees
As per the Statement of Particulars of Employees required U/S 217(2A) Of the CompanyAct 1956 read with the Companies (particulars of employees)Rules 1975 limit of salaryincreased up to Rs. 60 Lacs p.a. so this becomes inapplicable to our Company.
M/s. Shrikant & Co. Chartered Accountants Statutory Auditors of the Company holdoffice until the conclusion of ensuing Annual General Meeting and being eligible offeredthemselves for reappointment as per the section 141 of Companies Act 2013.
Members are requested to consider their reappointment and fix their remuneration.
Your Directors would like to express their grateful appreciation for assistance andco-operation received from Banks Government Authorities Customers Vendors and Membersduring the year under review.
Your Directors also wish to place on record their deep sense of appreciation for thecommitted services of Executives Staff and Workers of the Company.
| ||For and on behalf of Board of Directors |
|Date : 14th August 2014 ||Anasaheb R Mohite |
|Place : Kolhapur ||Chairman & Managing Director (DIN : 00317676) |
ANNEXURE TO THE DIRECTOR'S REPORT
I. Information pursuant to Section 217 (1) (e) of the Companies Act 1956 read withthe Companies (Disclosure of particulars in the report of Board of Directors) Rules 1988and forming part of Director's Report for the ended on 31 March 2014.
A. Conservation of Energy
a. The Company has been taking continuous steps to conserve the energy and minimizeenergy cost at all levels.
b. Total Energy consumption and energy consumption per unit.
|Particulars ||2013-14 ||2012-13 |
|Purchased: || || |
|Total Units consumed (in Lacs) ||96.74 ||96.71 |
|Total Amount ( Rs. in Lacs) ||697.04 ||703.31 |
|Rate per Unit ( Rs. ) ||7.20 ||7.35 |
|Own Generation through Diesel Generator Set ||N.A. ||N.A. |
|Own Generation through Furnace Oil Generator Set ||N.A. ||N.A. |
|Coal ||N.A. ||N.A. |
|Furnace Oil ||N.A. ||N.A. |
B. Research and Development
Research and development in processes methodologies continue to be of importance tous. This allows us to enhance quality productivity and overall efficiency and therebyensure customer satisfaction.
C. Foreign Exchange Earning and Outgo
|Particulars ||2013-14 ||2012-13 |
|Earnings ||Nil ||Nil |
|Outgo ||Nil ||Nil |