MOVILEX IRRIGATION LIMITED
ANNUAL REPORT 2002-2003
1) FINANCIAL RESULTS (Rs. In Lakhs)
Particulars Year Ending Year Ending
Turnover 1197.14 3300.03
Operating Profit (PBIDT) (-) 148.11 (-) 81.35
Provision For Gratuity & Nil 39.87
leave Salary for last 20 years
Interest 420.02 326.60
Depreciation 88.13 88.46
Loss before Tax (-)656.26 (-)533.28
Balance brought toward (-)1493.31 (-)513.13
Provisions, written off, Tax (-)61.55 (-)473.37
and prior period adjustments
Transfer from Reserves Nil 26.47
Balance Carried Forward (-)2211.12 (-)1493.31
The operation at both the unit had to be compulsorily suspended initially
due to workers non-cooperation followed by erratic demands ignoring the
facts of sickness of the Company. It was impossible to resume operations as
entire working capital of the Company was eroded. The Company requested to
both the Secured Creditors for preparing reinstallation package end submit
the some to Hon'ble BIFR to restructure the existing debt and to provide
fresh commensurating working capital finance. Failing the same, the Company
engaged a merchant banker, to identify a prospective investor who could
arrange for the required working capital fund etc. The Company the informed
that after contracting large number of players of the industry spread all
over country for strategic, none of them has shown any interest.
There after, in January 2003 the Company approached again to the secured
creditors for one time settlement in lumb sum for there dues based on the
offer received form potential investor. The Company is time end again
requesting the secured creditors for decision in the matter, however the
same is pending for decision till the day.
2) REFERENCE TO BIFR UNDER SICA.
The Company had made reference to the Board of Industrial and Finance
Reconstruction (BIFR) u/s.15 (1) of the Sick Industrial Companies (special
provision) Act, 1985 (the SICA) and obtained registration as Case
No.397/2001 Dt.16/10/2001. As entire net worth of the Company continued to
be eroded and therefore it continued to remain SICK, on the professional
advise it made another reference to BIFR all obtained registration
no.3/2003 Dt.1/1/2003 as mandatory compliance under the Act.
The circumstantial factors beyond the control of the Board of Directors,
which contributed towards the tragic situation, are briefly once again
stated as follows :
Repayment of Project Finance loan together with interest to the Institution
borrowed far PVC Pipe filling project, which miserably failed.
Demand recession prevailing in the economy resulting in pressure an quality
and operating margins and unused surplus capacities due to aimed dropping a
postponing various irrigation and health mine schemes by ft side government.
Failure to adjust the end product price in line with Steep fluctuations in
the raw material prices.
3) PARTICULARS OF EMPLOYEES :
The particulars of employees as required under Section 217 (2-A) of the
Companies Act, 1958 read with the Companies (Particulars of Employees)
Rules. 1975 and U/s. 217 (1) (e) of the said Act read with Companies
(Disclosure of Particulars in the Report of Directors) Rules 1988 are riot
given since none of the employees were in receipt of remuneration exceeding
the prescribed limits.
4) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNING
Particulars as prescribed under Section 217 (1) (e) of the Companies Act,
1956 read with Companies (Disclosure of Particulars in the Report of Board
of Directors) Rules, 1988 are given in Annexure which forms a part of the
5) AUDITORS REPORT :
The Notes No. 3 appearing in the Notes to Account referred to in the
Auditor's Report in respect of non-provision of disputed liability of sales
tax, excise duty and Notes No. 4 regarding erosion of the net worth of the
Company due to continued losses and write off and Notes No. 7 regarding
absence of confirmation of balances mainly from Debtors, Creditors and
Deposits are self explanatory and therefore does not call for any further
6) DIRECTORS RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217(2AA) OF THE
COMPANIES ACT. 1956.
The Board of Directors of the Company confirm :
i) That in the preparation of the annual accounts for the financial year
ended 31st March, 2003 the applicable accounting ate have been followed
along with proper exploration misting to materiel departure. The Company
had made provision for gratuity and leave salary on the basis of expert
labor consultant in absence of actuarial valuation and the same is paid to
employees who had tendered their voluntarily resignation.
ii) That the directors have selected such accounting policies and applied
them consistency and judgments and estimates that are reasonable and
prudent so as to give a true and fair view of the store of affairs of the
Company as at March 31, 2003 and loss of the Company for the year ended on
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 for preventing and detecting fraud and other irregularities;
iv) That the Directors have prepared the accounts on going concern basis.
7) CORPORATE GOVERNANCE
The Company is registered under BIFR vide Case No. 397/2001 and Case No.
3/2003 as the net worth of he Company was completely eroded, under the
circumstances it is difficult to convince any eminent person to join the
Board of Directors and hence it is difficult to comply with the requirement
of the Corporate Governance, pursuance to Clause No. 49 of the going
agreement with the Stork Exchanges, Therefore, Company has not obtained any
corporate governance report from its Auditors.
8) DIRECTOR :
Shri Harshed C. Shah, Director retires at the forthcoming Annual General
Meeting and being eligible, offer himself for re-appointment. The Board of
Directors, recommends his reappointment.
M/s. Prakash S. Doshi & Company. Chartered Accountants, retire as the
Auditors of that Company at the forthcoming Annual General Meeting end
being eligible, offers themselves for reappointment.
10) PERSONNEL :
The Board of Directors wishes to place on record its appreciation for all
the employees and all those who were associated with the Company until they
voluntarily resigned and accepted their retirement dues in full and final
settlement of the accounts. The Company appeals to all those employees and
workers who have yet not come forward at the earliest to receive their dues
failing which the Company may not be in a position to settle their dues due
to paucity of funds.
Your Directors place on record their deep sense of appreciation of the
services of the workers, staff and executives and the professionals, who
have contributed for the management of affairs of the Company.
Your Directors also thank the customers, vendors, investors, financial
institutions and bankers for their continuing support.
By order of the Board
For Movilex Irrigation Ltd.
Place: Pune Jaswant L. Sha
Date: 23rd June, 2003. Chairman
ANNEXURE TO THE DIRECTORS REPORT
Particulars pursuant to Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1956.
(A) Conservation of Energy :
The factory building of the Company is designed is such a way that it does
not require any Artificial lighting during the day time, thereby it
conserves the energy. The efforts to conserve and optimize the use of
energy though installation of state-of-the-art machinery continue to
1. Electricity Consumption
Unit Rates (Rs/KWH) 4.08
Units (Lace KWH) 10.77
Total Amount (Rs.Lacs) 43.91
(ii) Own Generation through D.G.Sets
Unit Rate (Rs./KWH) 6.66
Unit (KWH Lacs) 0.09
Total Amount (Rs. Lacs) 0.60
2. Coal : Not Applicable
3. Furnace Oil : Not Applicable,
4. Consumption Per Unit of Production :
Electricity : 552 KWH Per Tone of Finished Products.
Other Sources : Not Applicable.
(B) Research & Development :
During earlier years, the company had developed open able Drippers to clean
choking of contaminator deposits and make them reusable. This can be used
as substitute of disposable Dripper and could thereby reduce cost to the
Besides the Company had also developed and obtained ISI for the Screen Type
Irrigation Filters used in Drip Irrigation Systems. The Company also had
developed in-house Soli and Water Testing Laboratory.
(C) Technology Absorption, Adoption and Innovation :
The Company has not absorbed or adopted any technology other than that
provided by the equipment suppliers who themselves have designed the plants
in overseas technical collaborations, for manufacturing of Rigid PVC Pipes,
Drip Irrigation Laterals, PVC Houses, SWR Pipes, PVC Fittings and HDPE
Pipes. Your Company has not imported and technology during last five years.
(D) Foreign Exchange Earnings and Outgo :
Total Foreign Exchange Earned : Rs. Nil
Total Foreign Exchange Used : Rs. Nil