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Balmer Lawrie Freight Containers Ltd.

BSE: 500037 Sector: Industrials
NSE: N.A. ISIN Code: N.A.
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Balmer Lawrie Freight Containers Ltd. (BALMERLAWRFREI) - Director Report

Company director report

INDIAN MARINE FREIGHT CONTAINER MANUFACTURING LIMITED (Formerly Balmer Lawrie Freight Containers Limited) ANNUAL REPORT 2001-2002 DIRECTORS' REPORT Your Directors present the 8th Annual Report and Accounts for the financial year ended 31 March 2002, together with the audited Balance Sheet and Profit & Loss Account of your Company. Change of Name of the Company The name of your Company has been changed from 'Balmer Lawrie Freight Containers Ltd.' to 'Indian Marine Freight Container Manufacturing Limited' and the Special Resolution to this effect was passed at the last Annual General Meeting held on 29th December, 2001 and a fresh Certificate of Incorporation dated 26th February, 2002 was issued by the Registrar of Companies, West Bengal, consequent on change of name. Overview The macro economic issues which were adversely impacting the operations of your Company continued to persist during the year and the economics of operations made it unfeasible to involve in any capacity utilisation. However, your Company has been able to contain the recurring fixed costs during the year. Market The predatory and unfavorable pricing policy of the manufacturers in Peoples Republic of China continued during the year resulting in practically nil export of Marine Freight Containers out of India. The domestic off take has also been abysmally low. Operations The factory has been kept unutilised owing to the macro economic issues referred to above. Board for Industrial and Financial Reconstruction In July, 2001, Board for Industrial and Financial Reconstruction has ordered EXIM Bank, the Operating Agency of your Company to explore 'Change of Management' under Sick Industrial Companies (Special Provisions) Act, 1985 and EXIM Bank advertised for induction of strategic partner and advised for change in management. However, as yet no further development has taken place in this regard. Future Prospects The prospects of your Company depend on the outcome of the proceedings before Board for Industrial and Financial Reconstruction and the exercise being carried out by EXIM Bank at their behest. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Out-go 1. Conservation of Energy Details of electricity consumption is given below: 2001 / 02 2000 / 01 Energy Consumed (kwh) - 15,74,600 Throughput (TEUs) - 1,878 Per Unit Consumption (kwh) - 838 There had been no manufacturing operation during the year. 2. Technoloay Absorption There is no further development in this regard. 3. Foreign Exchange Earnings and Outgo There has not been any foreign currency transaction during the year other than revaluation of existing assets and liabilities. Particulars of Employees There is no employee drawing remuneration in excess of the amount specified under the Companies (Particulars of Employees) Rules, 1975 as amended. Directors Consequent to resignation, Mr. H. Shankar was relieved from the Directorship of your Company with effect from December 31, 2001. The Board records its appreciation and sincere gratitude for the valuable services and guidance provided by Mr. H. Shankar during his tenure on the Board of your Company. Pursuant to the above , Balmer Lawrie & Co. Ltd. nominated Mr. G. Roy, as a Director on the Board of your Company; accordingly, Mr. G. Roy was inducted at the Board with effect from 15 January, 2002. The Company has received an appropriate Notice from a Member under Section 257 of the Act proposing the appointment of Mr. G. Roy as a Director of your Company. Mr. G. Roy shall hold his office upto the ensuing Annual General Meeting. Mr. Heinz Rode and Prof. R. P. Aiyar retire by rotation at the ensuing Annual General Meeting and being eligible, Prof. R. P. Aiyar offer himself for re-appointment, but Mr. Heinz Rode expressed his inability for being re-appointed. Therefore, on the conclusion of the ensuing Annual General Meeting , he will vacate his office as the Director of your Company. Mr. P. Radhakrishnan, shall retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for reappointment. Public Deposit Your Company has not accepted "Deposits" from the public during the period under review. Directors' Responsibility Statement Pursuant to the requirement under Section 217 (2AA) of the Act, with respect to Directors' Responsibility Statement, it is hereby confirmed (i) that in the preparation of the accounts for the financial year ended 31 March 2002, the applicable accounting standards have been followed and there was no departure from such standards; (except as explicitly stated) (ii) that the Directors have selected such accounting policies and applied them consistently and made judgement 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 on 31 March 2002 and of the profit of the Company for the said financial year; (iii) that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records (this may please be read with Note No. 10 of Schedule 16 forming part of the Accounts) in accordance with the provision of the Act, 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 31 March 2002 on a 'going concern basis' (this may please be read with Note No. 5 of Schedule 16 forming part of the Accounts). Pursuant to the above, in connection with the observations, reservations, qualifications and / or adverse remarks made by the Auditors in their Report, the views / explanations of the Board are given in the Annexure pursuant to Section 217(3) of the Companies Act, 1956. Auditors M/s Ray and Ray, Chartered Accountants, retire by rotation at the forthcoming Annual General Meeting and are eligible, offer themselves for re-appointment. Acknowledgement Your Directors express sincere thanks to all the business partners for the continued support that was available to your Company from them and also to professional consultants, auditors, solicitors and lawyers for their continued patronage and confidence reposed in the Company. The Directors also wish to place on record their deep sense of gratitude to Balmer Lawrie & Co. Ltd. and its team of dedicated personnel for having extended their support throughout the year. Finally, the Directors express their gratitude to all the Shareholders for the confidence reposed by them in the management of the Company. Registered Office On behalf of the Board Netaji Subhas Road, Place : Kolkata - 700 001 (S. B. Chakravarty) Date : 31st July, 2002 Chairman Report of Board of Directors Annexure to report of Board of Directors to Members pursuant to Section 217(3) of the Companies Act, 1956. Sl. No. 1 Reference of Para in Auditors' Report 2.1 Auditors' Remarks The Accounts of the Company have been prepared on the basis that the Company is a going concern as indicated in Note 5 on Schedule 16. In the event of the Company's inability to continue as a going concern, the extent of resultant adjustment that would be made to reduce the value of assets to its recoverable amounts, to provide any further liabilities which might arise and to reclassify fixed assets and long term liabilities respectively are not ascertainable at this stage. View of the Board of Directors The Company is currently under BIFR and EXIM Bank has been appointed as the Operating Agency of the Company, to explore further avenues to rehabilitate the Company, including identifying parties who are interested for 'Takeover/Merger/Amalgamation'. This process is still under progress and EXIM Bank is yet to conclude the same. Therefore, it will be premature to conclude that the operations of the Company have come to a close and it ceases to be a 'going concern' and also the Company being under BIFR, is not in a position to reduce the value of its assets to its recoverable amounts, as the Company is not empowered to sell of its assets under the present scenario. In terms of the normal accounting practice, this principle has been applied and adequately disclosed by way of Note 5 of Schedule 16 forming part of the Accounts. Sl. No. 2 Reference of Para in Auditors' Report 2.2 Auditors' Remarks Note 6 regarding year-end secured loan balances which have not been confirmed. View of Board of Directors This has also been adequately dealt with in Note No 6 of Schedule 16 forming part of the Accounts. The circumstances of not having got a confirmation have been explained; it has also been stated that full provisions, to the extent required, have been made in the accounts. Sl. No. 3 Reference of Para in Auditors' Report 2.3 Auditors' Remarks Note 10 regarding valuation of inventories View of Board of Directors Note 10 of Schedule 16 forming part of the Accounts provides full information on the set of circumstances leading to the matter. Sl. No. 4 Reference of Para in Auditor's Report 4.6 Auditors' Remarks In view of the significance of the matters described in preceding Paragraph 2, (including inadequacy of required information details for ascertainment of net further adverse adjustments), we are unable to express an opinion whether the Balance Sheet and Profit and Loss Account give respectively, a true and fair view of the state of affairs as at 31st March, 2002 and its loss for the year ended on that date. View of Board of Directors It is the opinion of the Board that full details of the circumstances have been dealt with in the accounts and explained in Note 5 of Schedule 16, forming part of the Accounts. It is therefore the opinion of the Board that the Accounts, read with the Notes contained in Schedule 16 forming part of the Accounts being presented to the Members, do reflect a true and fair view, in the case of the Balance Sheet of the state of affairs of the Company as on 31 March, 2002, and in case of the Profit and Loss Account, of the loss for the year ended on that date. Sl. No. 5 Reference of Para in Auditors' Report 5 of Annexure Auditors' Remarks In view of the reasons related in Note 10 of Schedule 16, we cannot express our opinion on items (v), (vi) of Paragraph 4(A) of the said Order View of Board of Directors This deals (i) in case of item(V)-material discrepancies between results of physical stock verification and book records, and (ii) in case of item (vi)-principles of valuation of inventory. The circumstances have been dealt with in Note 10 of Schedule 16 forming part of the Accounts Registered Office On behalf of the Board Netaji Subhas Road, Kolkata - 700 001 (S.B. Chakravarty) Chairman Date : 31st July, 2002

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