SANGAM ALUMINIUM LIMITED
ANNUAL REPORT 2000-2001
To the Members,
Your Directors present their Thirteenth Annual Report together with the
Audited Statement of Accounts of the Company for the year ended 31st
In view of the losses incurred by the Company, your Directors regret their
inability to recommend any dividend for the year.
During the year under review, your Company could not resume its operations.
The suspension of work declared by the management on 15th February,1999 is
continuing till the date of this report. The operations could not resume as
a rehabilitation scheme, acceptable to Financial Institutions and Banks has
not yet been formulated.
There was a nominal sale of Rs.0.77 lacs of extrusion scrap lying at the
factory at the beginning of the year.
PROCEEDINGS AT BIFR
The proposal for rehabilitation of the Company, submitted by the private
promoters of the Company on 13th January 2000 in response to the
advertisement issued as per the directions of the Board of Industrial &
Financial Reconstruction (BIFR) was not accepted by the Financial
Institutions and Banks. Subsequently at a hearing held on 31st August,
2000, BIFR had issued directives for issue of Show cause notice for winding
up of the Company. BIFR also directed that if the Company submits a
worthwhile rehabilitation package, the Board would be willing to consider
the same at a further hearing and defer the show cause notice for sometime.
Accordingly the Company submitted a revised rehabilitation scheme.
The said notice came up for hearing before BIFR on 27.11.2000, where based
on the Company's request for consideration of its revival proposal,BIFR
directed IFCI, the Operating Agency (OA) to examine the proposal and
convene a joint meeting of participating Financial Institutions/ Banks to
consider the same. In the mean time, the show cause notice for winding up
of the Company was kept in abeyance.
As per the directive of BIFR the Company's aforesaid revival proposal was
examined and discussed at the joint meeting of participating Financial
Institutions and Banks held on 9th February,2001.The Banks have sought some
time to convey their stand on the Company's offer.
The Company is awaiting the decision of the Banks on the above proposal.
The promoters of the company have further raised a sum of Rs.73.50 lacs by
way of Equity Share Application Money/Unsecured Loan during the year. The
amount so raised has been utilised to make payment of staff salaries and
other fixed expenses and to repay some of the pressing creditors.
The financial position of your Company continues to stay grim, due to the
continuing huge losses on account of fixed expenses.
Shri H.K.Sinha,Chairman & Director tendered his resignation on 29th
December,2000 which was accepted by the Board on 29th December, 2000.The
Board places on record its sincere appreciation for the valuable guidance
provided by Shri H. K. Sinha during his tenure as Chairman & Director of
Sri T. Willington, director was appointed as Chairman & Director of the
Company by the Board on 29th December, 2000.
Shri B. Elangovan was appointed as an Additional Director of the Company on
29th December, 2000. He tendered his resignation on 21st May, 2001 which
was accepted by the Board on 27th June, 2001. The Board places on record
its sincere appreciation for the valuable guidance provided by Shri B.
Elangovan during his tenure as Director of the Company.
Shri S Sellaratnam and Shri V Jhunjhunwala, Directors retire by rotation
and being eligible, offer themselves for re-appointment.
M/s. S. Janardhan & Associates,Auditors of the Company,will retire at the
forthcoming Annual General Meeting and are eligible for re-appointment. The
Members are requested to appoint Auditors and authorise the Board to fix
DIRECTORS' RESPONSIBILITY STATEMENT PURSUANT TO SECTION 217(2AA) OF THE
COMPANIES ACT, 1956
The Directors hereby confirm:
i. that in the preparation of the annual accounts, the applicable
accounting standards had been followed alongwith proper explanation
relating to material departures;
ii. that the Directors had selected such accounting policies and applied
them consistently and made judgements 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 and of the profit or loss of the
Company for that period;
iii. that the Directors had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act 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
In line with the requirements of the Corporate Governance relating to
Listing Agreement and Section 292A of the Companies Act,1956 the Board has
constituted an Audit Committee comprising the following non-executive with
majority of Independent member Directors:
Sri S Sellaratnam - Chairman
Sri S Susai
Sri S Krishnamurthy
The role, terms of reference and the authority and powers of the Audit
Committee are in conformity with the requirements of the said Act and the
The Company did not invite or accept any deposit from the public under
Section 58A of the Companies Act,1956.
As regards observation made by the Auditors in Para 1 of their Report,the
Directors consider that para 1 (g) of the Notes to the Accounts explains
the status on the matter,and as regards the observations made in para 2(a)
and (b),the Directors consider the relevant Notes as self-explanatory and
do not call for any further clarifications or comments under Section 217(3)
of the Companies Act, 1956.
ENERGY,TECHNOLOGY AND FOREIGN EXCHANGE
Additional information on conservation of energy,technology absorption,
foreign exchange earnings and outgo as required to be disclosed in terms of
Section 217(1)(e) of the Companies Act,1956 read with the Companies
(Disclosure of Particulars in the Report of Board of Directors) Rules,1988
are annexed hereto and form part of this Report.
PARTICULARS OF EMPLOYEES
The company had no employee of the category indicated under Section 217(2A)
of the Companies Act,1956 read with Companies (Particulars of Employees)
Rules,1975,as amended from time to time.
The management is grateful to The IFCI Ltd.,The Industrial Development Bank
of India,The ICICI Ltd.,The Tamilnadu Industrial Development Corporation
Ltd.,The State Industries Promotion Corporation of India, Canara Bank and
Indian Bank for their continued co-operation. We are also thankful the
Government of India,Government of Tamilnadu and other Central & State
Government Departments and Local Authorities for their guidance and co-
For and on behalf of the Board of Directors
Place: Chennai T. Willington
Dated: 27th day of June, 2001 Chairman
ANNEXURE TO THE DIRECTORS' REPORT
DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY,
TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO AS REQUIRED
UNDER THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF
A. CONSERVATION OF ENERGY
I. Energy Conservation measures taken:
As the factory was under suspension of work, no energy was consumed and no
conservation measures could take place during the year.
II. Additional investment and proposals, if any, being implemented for
reduction of consumption of energy:
- Nil -
III. Impact of measures taken at (i) and (ii) above for reduction of energy
consumption and consequent impact on the cost of production of Goods:
Not applicable. Refer to point (i) above
iv. Total energy consumption and consumption per unit of production:
Not applicable. Refer to point (i) above
B. TECHNOLOGY ABSORPTION
a. Research & Development (R & D)
i. Specific areas in which R & D was : The Company is yet to
carried out by the Company commence R & D activities.
ii. Benefits derived as a result of the : Not Applicable
above R & D
iii.Future plans of action : Future planning will be done
the Company's factory after
iv. Expenditure of R & D : Nil
b. Technology Absorption, Adoption and Innovation:
As the factory was under suspension of work during the year under review,
no technology could be absorbed.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
a. Activity relating to Export Not applicable, as the
Company's factory was not
b. Initiative taken to increase Exports operating.
c .Development of new Export Market
for product and services
d . Export Plans
For and on behalf of
the Board of Directors
Place : Chennai T.Willington
Dated : 27th day June,2001 Chairman