TO THE MEMBERS
Your Directors have pleasure in presenting their sixty-seventh Annual Report togetherwith the Audited Accounts of your Company for the year ended 31st March, 2013.
(Rs. in Lacs)
| ||2013 ||2012 |
|Profit/(Loss) before depreciation and taxation ||(9759.52) ||932.73 |
|Less/Add: Depreciation ||1782.17 ||2123.45 |
|Profit/(Loss) before taxation ||(11541.69) ||(1190.72) |
|Add: Exceptional Items ||186.88 ||(10478.33) |
| ||(11728.57) ||(11669.05) |
|Less/Add: Provision for Earlier Year Taxation ||0.37 ||(113.84) |
| ||(11728.20) ||(11555.21) |
|Less/Add: Deferred Tax Liability ||(2193.03) ||(2394.78) |
|Profit/(Loss) after tax ||(9535.91) ||(9160.43) |
|Add: Balance brought forward from previous year ||1981.36 ||11141.79 |
|Add: Transferred from General Reserve ||5450.00 || |
|Less: Impairment of Revalued Assets ||2588.23 || |
|Which the Directors have decided || || |
|to carry forward to the next year ||(4692.78) ||1981.36 |
The demand for silk fabrics and made-ups tapered down both in Europe market and USmarket leading to lower sales during the year. To make up for the volume loss in the silk,the Company had to resort to polyester, cotton, viscose and other blended fabric. Althoughthe volumes remain the same but the realization per unit came down considerably whichresulted in lower profit margin. The Company's stand alone operation without consideringinterest and depreciation left small positive cash surplus. The interest in the carry overdebts could not be absorbed because of the lower turnover and stiff competition in themarket in spite of the management's best efforts.
The conditions stipulated under the CDR mechanism which is to be complied within31.03.2013, were duly complied and the promoters infused a sum of Rs. 740.00 lakhs astheir contribution.
Going forward unless there is a recovery in the overseas markets for the demand forsilk fabrics and garments, the future outlook for the time being looks bleak. However, themanagement is trying to change the product mix and lot of emphasis is made on new designsand colourways. It is expected that these changes will bring in additional business andalso improve the bottom line. Limited success has come in the supplies made in thedomestic market and we are expecting it to grow gradually over the years.
In view of the accumulated losses the Board of Directors do not recommend any dividendon Equity Shares. The Board of Directors does not also declare dividend on RedeemableCumulative Preference Shares.
PUBLIC DEPOSIT SCHEME
During the year, your Company has not accepted any deposits. There are no outstandingdeposits as on date.
A separate section on Corporate Governance and Management Discussion and Analysistogether with the Auditors' Certificate confirming the compliance of conditions onCorporate Governance as per Clause 49 of the Listing Agreement with the Stock Exchangeform part of the Annual Report.
Shri G.D Harnathka and Shri R.S Rungta, Directors of the Company retires from theoffice by rotation and are eligible for re-appointment.
DIRECTORS' RESPONSIBILITY STATEMENT
As required under provisions of Section 217 (2AA) of the Companies Act, 1956, yourDirectors confirm:
i) That in preparation of the annual accounts, the applicable accounting standards havebeen duly followed.
ii) That the Directors have selected such accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the loss of the Company for the year under review.
iii) That 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.
iv) That the Directors have prepared the accounts for the financial year ended 31stMarch, 2013 on a going concern basis.
DISCLOSURE OF PARTICULARS
The information required under Rule 2 of the Companies Act, 1956 (Disclosure ofParticulars in the Report of Board of Directors Rules, 1988) relating to conservation ofenergy, technology absorption, foreign exchange earnings and outgo is annexed.
Messrs B.K. Shroff & Company, Chartered Accountants, retire at the forthcomingAnnual General Meeting and being eligible, offer themselves for re-appointment.
The remarks of the Auditors regarding provision for bad and doubtful debts, recognitionof Net Deferred Tax Assets have been duly explained in Note No. 37 and 39 to the Accountsrespectively.
Pursuant to the directives of the Central Government under the provisions of Section233 B of the Companies Act, 1956, the Cost account records maintained by your Company aresubject to yearly audit by qualified Cost Auditors. Your Company has appointed M/s. N.Radhakrishnan & Co., a firm of Cost Auditors, for conducting the audit of such recordsfor the financial year 2012-13.
There was no employee employed during the financial year or a part of the financialyear who was in receipt of remuneration for that year or any part of that year at a rateprescribed under Section 217(2A) of the Companies Act, 1956 read with the Companies(Particulars of Employees) Rules, 1975 as amended.
Your Directors wish to convey their appreciation for the co-operation and assistancereceived from the government, financial institutions, bankers and stakeholders of yourCompany. The Board wishes to place on record its deep appreciation for the integrity andhard work of its employees at all levels to meet challenging markets.
|Registered Office: ||By Order of the Board |
|19, R. N. Mukherjee Road ||S. S. SHAH |
|Kolkata 700 001 ||Chairman & Managing Director |
|Dated: The 29th May, 2013 || |
ANNEXURE TO DIRECTORS' REPORT
Information pursuant to Section 217(1)(e) of the Companies Act, 1956 read with theCompanies (Disclosure of particulars in the Report of Board of Directors) Rules 1988,forming part of Directors' Report :
CONSERVATION OF ENERGY :
The Company has developed a continuous process of energy conservation through improvedoperational and maintenance practices.
(A) Power and Fuel Consumption
|1. Electricity || ||Current Year ||Previous Year |
|(a) Purchased ||Units ||30,83,301 ||29,81,557 |
|Total Amount ||Rs. ||1,93,89,568 ||1,80,90,354 |
|Rate/Unit ||Rs. ||6.29 ||6.07 |
|(b) Own Generation through || || || |
|Diesel Generator ||Units ||1,81,481 ||1,50,550 |
|Total Amount ||Rs. ||27,38,737 ||20,29,952 |
|Cost/Unit ||Rs. ||15.09 ||13.48 |
|2. (a) Briquettes || || || |
|Quantity ||Kgs. ||9,58,400 ||12,69,729 |
|Total Amount ||Rs. ||42,36,298 ||53,50,189 |
|Cost/Unit ||Rs. ||4.42 ||4.21 |
|(b) Fire Wood || || || |
| || || ||- |
|Quantity ||Kgs. ||5,37,470 || |
| || || ||- |
|Total Amount ||Rs. ||20,93,262 || |
| || || ||- |
|Cost/Unit ||Rs. ||3.89 || |
|(B) Consumption per unit of products: || || || |
|Silk Fabrics ||Mtrs ||5,25,779.30 ||5,15,237.80 |
|Electricity ||Rs. ||36.88 ||35.11 |
|Briquettes ||Rs. ||8.06 ||10.38 |
|Fire wood ||Rs. ||3.98 ||- |
|Diesel ||Rs. ||5.21 ||3.94 |
|Research & Development || |
|1. Specific areas in which R&D carried out by the Company ||R&D activities are concentrated on development of new fabrics and new designs. |
|2. Benefits derived as a result of above R&D ||Higher product value, better realization and repeat orders. |
|3. Future plan of action ||Further improvement in quality parameters of finished products. |
|4. Expenditure on R & D || |
| ||Capital ||Rs. Nil |
| ||Recurring ||Rs. 59.09 lakhs |
| ||R&D Expenditure as a percentage of turnover ||0.80% |
Technology Absorption, Adaptation & Innovation
|1. Efforts in brief, made towards technology Absorption, adaptation and innovation ||Latest technologies are used to develop value added products with innovative designs. |
|2. Benefits derived as a result of the above ||Minimum wastage and reduced sampling cost. |
|3. Details of imported technology ||Not Applicable. |
|FOREIGN EXCHANGE EARNINGS & OUTGO || |
|(a) Activities relating to exports, initiatives taken to increase exports, development of new export markets for product and services and export plans. ||Participating in the international trade fairs to showcase the Company's new developments and also invite the different Company's selling agents as well as customers to provides a platform of interaction in order to procure orders for the Company's products as well as scout for new customers. |
| ||Travelling expenses in respect of such activities are also expensive. Travelling by the sales personnel also brings in orders for the Company's products. |
|(b) (I) Overseas Travelling ||The information on foreign exchange earnings and outgo is contained in Note No. 48 & 49 of Notes on Financial Statements. |
|(ii) Commission to Agents || |
|(iii) Consultation Fees || |
|(iv) Others || |
| ||By Order of the Board |
|Kolkata 700 001 ||S. S. SHAH |
|Dated : The 29th May 2013 ||Chairman & Managing Director |