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Enkay Texofood Industries Ltd.

BSE: 514254 Sector: Industrials
NSE: N.A. ISIN Code: INE108D01017
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Enkay Texofood Industries Ltd. (ENKAYTEXOFOOD) - Director Report

Company director report

ENKAY TEXOFOOD INDUSTRIES LIMITED ANNUAL REPORT 2001-2002 DIRECTORS'REPORT TO THE MEMBERS The Directors present their Twentieth Annual Report on the operations of the Company alongwith the Audited Statement of Accounts for the year ended 31st March 2002. FINANCIAL RESULTS (Rs. in Lacs) Year ended Year ended 31-03-2002 31-03-2001 Sales, Services & Other Income 447.02 195.07 (Loss)/Profit before Interest, Depreciation & Tax (1128.50) (4289.00) Add/Less: Interest 0.00 4025.47 (Loss) before Depreciation & Tax (1128.50) (8314.47) Add: Depreciation 718.15 730.54 (Loss) before Tax (1846.65) (9045.01) Add: Extra-ordinary Item 0.00 3354.35 Prior Years' Adjustments 100.00 700.00 100.00 4054.35 (Loss) after Tax (1946.65) (13099.36) Less: Provisions for earlier year written Back 0.00 17.38 (1946.65) (13081.98) (Loss)/Profit brought forward from earlier year (17693.16) (4611.18) Balance of (Loss)/Profit carried to Balance Sheet (19639.81) (17693.16) OPERATIONS: During the year under review, the manufacturing operations in food processing division was suspended throughout the year while manufacturing operations in textile division was operated only partially because of erosion of working capital funds due to heavy losses in earlier years. The proposal put up by the Company for restructuring of debts and envisaging additional working capital assistance from Financial Institutions and Banks has not been approved till date and is pending with them, And due to heavy losses the net worth of the Company as at 31.03.2001 was fully eroded and it was mandatory to file an application with Board for Industrial and financial Reconstruction and the same was filed on 1st May, 2001. The Board for Industrial and Financial Reconstruction has registered our case as Case No. 188/2001 vide its letter dated 23rd May, 2001 The honourable Bench of Board for Industrial and Financial Reconstruction has heard the Company and the Secured lenders on the hearing held on 11th June, 2002 and the Company is taking necessary steps to comply the directives given by the honourable Members. DIVIDEND: In view of loss during the year under review, your Directors are not recommending any dividend on Equity Shares and Preference Shares for the year ended 31st March, 2002. DIRECTORS' RESPONSIBILITY STATEMENT In terms of Section 217 (2AA) of the Companies Act, 1956, 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 judgements 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 provision of this Act for safeguarding the assets of the Company and for preventing and detecting flaud and other irregularities; iv) The Directors have prepared the annual accounts on a going concern basis. LISTING ON STOCK EXCHANGES: The National Stock Exchange and Bombay Stock Exchange has suspended the trading of the Equity Shares of your Company due to non compliance of Investors' Grievances. CORPORATE GOVERNANCE: Your company will take necessary steps for implementation of Corporate Governance at the earliest. PROVISIONS OF SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985. As you are aware, in view of the accumulated losses of the Company having exceeded net worth as at 31st March, 2001, your Company is registered with the Board for Industrial and Financial Reconstruction (BEFR) as Case No. 188/2001. OVERDUE AMOUNT ON REDEMPTION OF DEBENTURES: An amount of Rs. 156428 Lacs is overdue towards redemption of debentures and interest thereon. AUDITORS: M/s. M.D. Gala, Chartered Accountants, MUMBAI Statutory Auditors of the Company hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Members are requested to appoint Statutory Auditors of the Company to hold office till the conclusion of the next Annual General Meeting of the company and to fix their remuneration. AUDITORS'REPORT: Observations made in the Auditors' Report vide Item No. (v) to (viii) read with Note Nos. 2,3,5 to 16 in Schedule 17 (being Notes forming part of the Accounts), are self-explanatory and do not call for any further comments pursuant to Section 217(3) of the Companies Act, 1956. FIXED DEPOSITS: Due to financial stringency, acute Liquidity crunch and adverse cash flow the Fixed Deposits, aggregating to Rs. 4,91,05,367/- and interest of Rs.28,69,645/- remained unpaid in spite of the best of the efforts of the company. the company is trying to repay this liability at the earlist. the company Law Board is being intimated about the same. SUBSIDIARY OF THE COMPANY: The Report of the Directors of Enkay Europe B.V.,a wholly owned subsidiary of Your Company and Statement of Accounts of the said subsidiary for the year ended 31st December, 2001, thereon, form part of this report and are attached. A statement pursuant to Section 212 of the Companies Act, 1956 is attached herewith. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO: The particulars pursuant to Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules, 1988 are given in the Annexure "A" forthcoming part of this report. PARTICULARS OF THE EMPLOYEES: As required under Section 217 (2A) of the Companies Act, 1956 and the provisions ma& thereunder, the annexure containing the particulars of employees who were in receipt of remuneration aggregating Rs.6,00,000/- or more per annum if employed throughout the year or Rs. 50,000/- or more per month in case employed for part of the year, is annexed herewith as an Annexure "B". PERSONNEL: During the year under review, barring a few incidents of non- cooperation industrial relations at all the units of the Company continued to be satisfactory. Your Directors wish to place on record their appreciation of the contribution made by employees at all levels ACKNOWLEDGMENT: We take this opportunity to place on record out appreciation and sense of gratitude for the continuous support extended by the Company's Bankers and Financial Institutions, Central and State Government Departments, Customers, Suppliers and Contractors. We also convey our heartfelt thanks to the Shareholders, Debenture holders and Depositors for their unfailing trust, confidence and encouragement We are also grateful to the employees of the Company at all levels for their untiring hard work, sincerity and loyalty. For and on behalf of the Board Mumbai 31st August, 2002 TULSIDAS GOYAL MURLPAANOHAR GOYAL Managing Director jt. Managing Director ANNEXURE "A" TO THE DIRECTORS'REPORT ANNEXURE UNDER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956 READ WITH COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988 AND FORMING PART OF DIRECTORS'REPORT. (A) cONSERVATION OF ENERGY FORM A Form of Disclosure of Particulars with respect to Conservation of Energy Current Year Previous Year ended 31/03/02 ended 31/03/01 A. POWER AND FUEL CONSUMPTION 1. Electricity a. Purchased Units (KWH) - - Total Amount(Rs.) - - Average Rate/Unit(Rs.) - - b, Own generation i. Through Diesel Generator Units (KWH) 6,22,420 - Total Amount(Rs.) 27,07,528 - Units per litre of diesel oil 4.25 - Average cost of unit(Rs.) 4.35 - ii. Through Steam turbine/generator Units (KWH) - - Units per litre of diesel oil - - Cost/Unit (Rs./KmH) - - 2. (Specific Quantity and Coal where used) Quantity (MT) - - Total Cost (Rs.) - - Average Rate (Rs./MT) - - Coal was used in Boller at Bhilad & Vapi factory. 3. Furnace Oils/LSHS Quantity (LTRS) - - Total Cost(Rs.) - - verge Rate(Rs.1 LTRS) - - 4. Others./internal Generations Phenol residues (waste tar) Quantity (MT) - - Total Cost - - Rate/Unit - - B. CONSUMPTION PER UNIT F PRODUCTION Electricity(KWH) - Yarn - - - Fruit Processing - - - Diesel - Yarn - - - Fruit Processing - - (B) TECHNOLOGY ABSORPTION The technology for processing synthetic yarn and for processing various fruits has been fully absorbed by the Company. No research and development program has been undertaken by the Company during the year. (C) FOREIGN EXCHANGE EARNINGS AND OUTGO Total Earnings(FOB Value) Rs. Nil Nil Total Expenditure Rs. Nil Nil On account of traveling, other expenses, dividend & interest on Foreign Currency loan. For and on behalf of the Board of Directors Bombay TULSIDAS GOYAL MURLIMANOHAR GOYAL 31st August, 2002 MANAGING DIRECTOR JT MANAGING DIRECTOR ANNEXURE "B" TO THE DIRECTORS' REPORT Information as per Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employee) Rules, 1975. There was no employees who were paid remuneration aggregating to Rs.600000/- or more per annum if employed through out the year or Rs.50000/- or more per month in case employed for part of the year. Notes: 1) Nature of Employment whether contractual or otherwise a) The appointment of managing Director and Joint Managing Director are contractual. b) The appointment of other employees are not contractual. 2) the remuneration referred above includes Salaries, House Rent Allowance(HRA) and other allowances and Provident Fund, Family Pension Fund & other perquisites wherever applicable. 3) Directors & Relatives: a) The Managing Director & Joint Managing Director are relatives. b) None of the employees is related to any Director of the Company. 4) There is no employee in respect of whom details is required to be given under sub-clause a(iii) of Section 217(2A) of the Companies Act, 1956. For and on behalf of the Board of Directors Mumbai TULSIDAS GOYAL MURLIMANOHAR GOYAL 31st August, 2002 Managing Director Jt.Managing Director