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Goa Fruit Specialities Ltd.

BSE: 531477 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE230M01010
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Goa Fruit Specialities Ltd. (GOAFRUITSPEC) - Director Report

Company director report

GOA FRUIT SPECIALITIES LIMITED ANNUAL REPORT 2011-2012 DIRECTOR'S REPORT Your Directors have Pleasure in Presenting the 23rd Annual Report together with audited statement of accounts for the year ended 31st March, 2012. WORKIING RESULTS: During the period under review your Company spent Rs.49.80 Lakhs as Pre- operative expense. No Income was generated during the year under review. The working results for the Financial Year 2011-12 and 2010-11 are as under: (Amount in Rs) Particulars 31-3-2012 31-03-2011 Total Income Nil Nil Depreciation Nil Nil Profit/(Loss) before Tax Nil Nil Provision for Tax-FBT Nil Nil Profit (loss) after Tax Nil Nil Note: The Company incurred an expenditure of Rs.49.80 Lacs as Pre- operative Expenses during the year. OPERATIONS AND FUTURE PLANS Your Directors are pleased to report that a study for the revival of the Company is already underway. The listing of Shares of the company is approved for Revocation of Suspension and Trading is likely to begin within a short time. The Company plans to raise more funds to augment resources which have been necessitated due to afflux of time and cost overrun and foreign exchange rate fluctuations since 1998 when the commercial production was to commence. The Company had completed construction of 30,000 sq. ft RCC building and had purchased imported and indigenous machines. The Company was about to commence production but could not do so due to ban on power connections by the High Court of Bombay (Goa Bench) imposed in the year 1997 98 which resulted into lapse of LOP of 100% EOU. The Company has been making frantic efforts to get the Extension of LOP from the Ministry of Commerce & Industry, New Delhi but the request of the Company was not acceded to by the Board of Approvals. For the past five years the Company was in the process of seeking review and Extension to LOP through SEEPZ & the Ministry. The Company even approached the High Court of Mumbai (Goa Bench) but the Hon'ble High Court declined to interfere. The direct impact of this non extension of LOP was requirement of payment of Excise & Custom Duties. Hon'ble High Court, however, allowed the Appeal pending with CESTAT to be admitted on payment of Rs. 15 Lacs. The said appeal is lying pending with CESTAT. Your Directors are also looking and examining other business options including acquisition of running businesses as well as other good viable opportunities where some value and synergies can be perceived. It is our Objective that we commence activities in the next few months and consolidate our position by 2013. DIVIDEND: Since the Company could not generate any profits, management does not propose any dividend for the year 2011-2012. DIRECTORS: Mr. Akhil B. Gupta, Director retires at the ensuring Annual General Meeting, and being eligible offers himself for reappointment. The Board commends his reappointment. The term of Mr. J.M. Chawla, Managing Director of the Company, ends on September 30, 2012. In terms of the provisions of the Articles of Association of the Company, the Board of Directors has, at its meeting held on 24th August, 2012, re-appointed him as a Managing Director of the Company. For a further period of three years with effect from 1st October, 2012 on remuneration of Rs.12,00,000/- (Rupees Twelve Lakhs only) per annum. In case the Company has no profits or its profits are inadequate, then this remuneration of Rs.12,00,000/- (Rupees Twelve Lakhs only) be paid to him without the prior approval of Central Government or such other amount up to the limit of Rs. 20,00,000/- (Rupees Twenty Lakhs only) as may be permitted by the Central Government, in accordance with the provisions of Section II of Part II of Schedule XIII of the Companies Act, 1956 at that time. The Board commends his reappointment. DIRECTORS' RESPONSIBILITY STATEMENT: Your Directors' state: i) That in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanations relating to material departure; ii) That the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are 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. iii) That the Directors had 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 had prepared the annual accounts on a going concern basis. FIXED DEPOSITS: Your Company has neither invited nor accepted any Fixed Deposits from the public during the financial year under review. CORPORATE GOVERNANCE AND COMPLIANCE CERTIFICATE: Separate notes on Corporate Governance and Management Discussion and Analysis Report are set out as Annexure 'A' and 'B' respectively. A Certificate from the Auditors of the Company certifying compliance conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement is attached to this report. LISTING AGREEMENT REQUIREMENTS: The securities of your Company are listed at Bombay Stock Exchange. Trading in Company's securities was suspended at the Bombay Stock Exchange for various reasons including non-submission of documents. The Management had submitted all compliance and is pleased to inform you that the Company has received In-Principle Approval for revocation of suspension of trading of shares of the Company and is in the process of complying with certain post sanction formalities. Your Directors are confident that the shares of your Company will be traded shortly. BUY-BACK OF SHARES: There was no buy-back of shares by the Company during the year under review. PARTICULARS OF THE EMPLOYEES: None of the employees employed during the year was in receipt of remuneration in excess of the Prescribed limit specified in section 217 (2A) of the Companies Act, 1956 Hence, furnishing of particulars under the Companies (Particulars of Employees) 1975 does not arise. AUDITORS: M/s Krishan Kumar Gupta & Associates, Auditors of the Company retire at the ensuing Annual General Meeting. They have expressed their willingness for reappointment. The Board commends their reappointment. CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION: During the year under review, there were no activities, which required heavy consumption of energy. However adequate measures have been taken to make sure that there is no wastage of energy. Since the requisite information with regard to the conservation of energy, technology absorption (Disclosures of Particulars in the report of Board of Directors) Rules is irrelevant/not applicable to the Company during the year under review, the same are not reported. FOREIGN EXCHANGE EARNINGS AND OUTGO: During the period under review the Company neither earned nor made any payments of any Foreign Exchange to any one. ACKNOWLEDGMENTS: The Board of Directors wish to place on record their appreciation for the co-operation and support of the Company's Bankers, its valued customers, employees and all other intermediaries concerned with the Company's business. Your directors sincerely thank all members for supporting us during the difficult days. We look forward to your continued support and reiterate that we are determined to ensure that the plans are successfully implemented. MANAGEMENT DISCUSSION AND ANALYSIS Overall review, industry Structure and Developments: There is a great demand of processed foods all over the world. The company has shed its status as 100% EOU but will be involved in domestic sales. Opportunities and Threat: The prices of food products are rising and it is an opportunity to keep pace with the market developments and earn profits. The threat lies in high cost of distribution owing to transport logistics. Segment wise Performance: Not Applicable as the company has yet to commence commercial production. Out Look: Your Director's feel that the future out look is highly positive. Internal control System: Your Director's have taken steps to have effective internal control systems. Human relations: The Company has over the years maintained excellent human relations with its staff, vendors, workers and people at large. Financial performance with respect to operational performance The commercial production is yet to commence. During the year under review, the Company has incurred an expense of Rs.20.51 Lacs as Pre operative expenses. Expenses: The working results are given as under: Particulars 31-3-2012 31-03-2011 Total Income Nil Nil Depreciation Nil Nil Profit/(Loss) before Tax Nil Nil Provision for Tax-FBT Nil Nil Profit (loss) after Tax Nil Nil By order of the Board of Directors, For Goa Fruit Specialities Ltd., J.M. Chawla Managing Director Place: Panjim, Goa Date : 24/08/2012.