ADHUNIK YARNS LIMITED
ANNUAL REPORT 2007-2008
Adhunik Yarns Limited,
Yours Directors have pleasure in presenting the Twenty first Annual Report
and Audited Statement of Accounts for the Year ended 31st March 2008.
(Rs. In lacs)
Sales and other Income 0.95 1.45
Add: Extraordinary Exceptional items Nil 1067.73
Profit/(Loss) before depreciation and tax (64.20) 1055.62
Less/(Add): Depreciation 19.58 32.40
Profit/(Loss) before tax (83.78) 1023.22
Less/(Add): Tax Adjustments 0.00 0.00
Net Profit/(Loss) after tax (83.78) 1023.22
Due to continuous recession in textile industry, shortage of working
capital, the manufacturing operation of both the units of the company
continued to be suspended during the year also. The turnover and other
income recorded Rs. 0.95 lacs as compared to earlier year Rs.1.45 lacs.
During the year, the company has incurred loss of Rs.64.20 lacs before
depreciation and tax and net loss of Rs. 83.78 lacs. During the previous
year, the company has paid off entire OTS amounts to Bank of Baroda & IDBI
and the relief amounting to Rs.1067.73 lacs received by the company on OTS
in interest and principle has been credited to profit and loss account as
an extraordinary exceptional item.
In view of loss for the year, your directors regret their inability to
recommend payment of any dividend for the year.
In accordance with the provisions of the Companies Act, 1956 and the
Articles of Association of the Company Shri Pradeep Poddar retires by
rotation and being eligible offer himself for re-appointment.
REFERENCE TO BIFR:
As reported last year, the company's net worth as per the audited accounts
as at 31st March 1999 stood fully eroded and accordingly a mandatory
reference was made to BIFR under section 15 of the Sick Industrial
Companies (Special Provisions), 1985 on 01/10/1999 which is duly registered
on 13.10.1999 under case no. 330/99. BIFR appointed IDBI as an Operating
Agency for getting the special investigative report for last three
financial years. The auditors appointed by IDBI submitted the special
investigative report in May 2000. The company was declared sick industrial
company by the BIFR in terms of section 3(1)(o) of the Act. The Bench
further directed to explore the possibility of change of management but no
concrete offer was received for the same.
Therefore in view of explored and exhausted all possibilities to
rehabilitate the company, the Bench formed a prima facile opinion, vide its
order issued on 11th August 2003, that the company is not likely to make
its net worth exceed its accumulated losses within a reasonable time while
meeting all its due financial obligations, hence not likely to become
viable on longterm basia. Therefore the BIFR formed, an opinion, on prima-
facie, that it is just and equitable and in public interest that it is
wound up u/s 20(1) of the Act and send the matter to the concerned High
Court. In the meantime, since the company has reached OTS with Bank of
Baroda and IDBI, the proceedings of the DRT and winding up have been
suspended. The company sold substantial part of its fixed assets of both
the units with a view to pay off entire OTS amounts to IDBI and Bank of
Baroda. The company has paid the dues of such secured creditors and
received 'no dues' certificates' from Bank of Baroda, SICOM and -IDBI.
The equity shares of the company are listed on Mumbai, Delhi, Madras and
Ahemdabad Stock Exchanges. The annual listing fees have been paid till
Due to continuous financial difficulties only, the company could not get
insured its assets and properties.
During an earlier year the company has accepted fixed deposits from a
relative of the directors. Out of such deposit an amount of Rs. 200000/-
are still to be paid however the company is regular in payment of interest.
During the year under review, due to payment of OTS, the company had also
to take interest free deposit from a firm in which relatives of the
directors are partners.
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 217 (2AA) of the Companies Act, 1956 with respect to
Directors' responsibility statement, it is hereby confirmed:
i) That the preparation of accounts for the financial year ended 31st March
2007, the applicable accounting standards have been followed along with
proper explanation relating to material departures.
ii) That 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 true and fair view of the state of affairs of the
company at the end of the financial year and the profit or loss of the
company for the year under review.
iii) That the Directors have 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 the Directors' have prepared the accounts for the financial year
ended 31st March 2007 on a 'going concern' basis.
CONVERSATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
Since the company has no manufacturing operations there are no particulars
to be furnished with regard to conservation of energy and technology
absorption pursuant to section 217(i) (e) of the Companies Act, 1956, read
with the Companies (Disclosure of particulars in the Report of Board of1
Directors) Rules 1988. The foreign exchange earnings and outgo were Nil.
PARTICULARS OF EMPLOYEES:
Particulars of employees under section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rule 1975 are not-
attached with this report as no employee comes under the purview of these
M/s. R.S. Agrawal & Associates, Chartered Accountants, the Auditors of the
Company are retiring at the forthcoming Annual General Meeting. The members
are requested to appoint the auditors.
The Auditors report is self-explanatory and hence do not require any
The Board of Directors place on record their appreciation for the support
and co-operation received from the Government, Bankers, IDBI, SICOM,
Dealers, Suppliers, Employees and you the shareholders.
By Order of the Board
For ADHUNIK YARNS LIMITED
Mumbai, 11th August 2008.