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Cavalet India Ltd.

BSE: 526351 Sector: Others
NSE: N.A. ISIN Code: N.A.
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Cavalet India Ltd. (CAVALETINDIA) - Director Report

Company director report

CAVALET INDIA LIMITED DIRECTORS REPORT TO SHAREHOLDERS Your Directors are pleased to present the Sixth Annual Report and the Auditors Accounts of the Company for the year ended 31st March 1997. 1. OPERATING PERFORMANCE During the year under review, your Company has made a loss, before depreciation, of Rs. 124.46 lakhs (previous year Rs. 153.45 lakhs). Company facing liquidity crunch due to carried over losses, worldwide recession in leather industry and absence of credit facilities from the Bank could not adhere to the repayment schedule of instalments and interest due to the State Financial Institutions, namely Karnataka State Industrial Investment & Development Corporation Ltd. and Karnataka State Financial Corporation. Hence on 19th November,1996, KSIIDC have taken over the possession of our manufacturing unit at Kumbalgodu, enforcing Sec.29 of State Finance Act. Management is trying its best to get release of assets so acquired by the Institutions. During the year company has become a potentially sick under the provisions of Sec. 23 of Sick Industrial Company (Special Provisions) Act 1985 and accordingly Extra-Ordinary General Meeting of the Company was held on 29.11.96. The matter has been intimated to BIFR, New Delhi. 2. DIVIDENDS As the company has not made any profits, your directors do not recommend any dividends. 3. DIRECTORS Mr. G.L. Puruswani and Mr. Tommy Mansson retires by rotation and are eligible for re-appointment. During the year Mr. H.V. Gowthama resigned due to his pre-occupation. Directors hereby place on record their appreciation for the services rendered by him to the company during the tenure of his Directorship. 4. AUDITORS M/s. B.N. Govinda Prasad, Chartered Accountants, Bangalore, the retiring auditors, are eligible for re-appointment. AUDITORS REPORT As regards the qualifications in para 2 of the Auditors Report dated 15/11/97 on the accounts under review, your directors wish to state that: a) Reconciliation of individual Shareholder's folios, for allotment monies receivable, could not be completed since some original record is misplaced while shifting office from Kumbalagodu to Koramangala. However we have requested the Registrar of issues to give duplicate record so as to complete reconciliation. b) Pending completion of the construction of Administrative Block at the factory premisis, advances on capital account have not been settled. It will be done on completion of the construction. c) Reconciliation and confirmation of individual Sundry Creditors will be done during the year. d) Company has already been registered under Employees State Insurance Scheme. Since Company's manufacturing activities have been stopped from Sept.'96 and most of the labour force have left, Company has not taken necessary steps for registration under Provident Fund Scheme. e) Since Company's manufacturing activities have been stopped from Sept, 1996 depreciation has been provided from April'96 to September'96 only. f) The Vysya Bank Ltd. have taken legal action against the Company for non- repayment of Bridge Loan including interest and the mater has been referred to the Debt Recovery Tribunal, Bangalore. g) Weizmann Industries Ltd., have proposed to convert the Hire-purchase loan to Deep-Discount debentures. Pending finalisation of their proposal, hire-charges/interest on the Hire-purchase loan account have been accounted upto 31/13/1996 only. h) Due to liquidity crunch company could not pay instalments and interest to M/s Karnataka State Industrial Investment & Development Corporation Ltd. Hence they took the possession of Company's immovable & movable assets at the manufacturing unit at Kumbalagodu in November 96 and therefore interest on Term Loan from KSIIDC & KSFC have been provided upto November 96. i) The Company has made efforts to appoint full-time company Secretary. However, the efforts made by the Company to appoint a suitable Company Secretary has not been materialised. 5. TECHNOLOGY ABSORPTION Information in accordance with the provisions of section 2171) (e) of the Companies Act read with the Companies (disclosures of particulars in the report of the Board of Directors). Rules 1988 regarding Technology absorption is given in annexure 'A' which forms the part of this Report. 6. PARTICULARS OF EMPLOYEES None of the employees drew remuneration more than the limits specified under the provisions of Section 217 (2A) of the Companies Act 1956 read with the Companies (Particulars of the Employees) Rules 1975. 7. ACKNOWLEDGEMENTS Your directors take this opportunity to place on record their appreciation of the co-operation extended by KSIIDC, KSFC, THE VYSYA BANK LTD., & M/s. WEIZMANN INDUSTRIES LIMITED during the year under review. Your Directors wish to place on record their deep sense of appreciation for the devoted services of the employees at all levels. For and on behalf of the Board P.P.NANAVATY Chairman & Managing Director Place: Bangalore Dated: 15/11/1997 CAVALET INDIA LIMITED ANNEXURE `A' FORM B (See Rule 2) disclosure of particulars with respect to Technology Absorption forming part of the Directors Report for the year ended 31st March, 1997. A. CONSERVATION OF ENERGY The amount spend on power as compared to the turnover is insignificant. Expenditure on water and electricity was Rs.1.03 lakhs (Previous year Rs. 3.63 lakhs). B. TECHNOLOGY ABSORPTION, ADOPTION & INNOVATION RESEARCH & DEVELOPMENT 1. Specific areas in which R&D carried } The company has developed out by the company } business bags like overnighter 2. Benefits derived as a result } organisers, laptop cases and 3. Future plan of action } travel accessories 4. Expenditure on R&D } a) Capital b) Recurring c) Total d) Total R & D Expenditure as a percentage Turnover. TECHNOLOGY ABSORPTION & ADOPTION 1. Efforts in brief, made towards : Information exchange & advic technology absorption, adoption and through technical consultant innovation. 2. Benefits derived as a result of the : Efforts being made to use above, eg. product improvement, cost indigeneous materials where reduction, product development import possible will result in import substitution etc. substitute 3. In case of imported technology (Imported during the last 5 years reckoned from the beginning of the financial year), following informations may be furnished : NIL a) Technology Imported b) Year of Import c) If not fully absorbed area where this has not taken place, reasons therefore & future plans of action. C. FOREIGN EXCHANGE EARNINGS & OUTGO During the year earnings in Foreign Exchange was Nil (Previous year Rs.41.21 lakhs). The outgo of Foreign Exchange during the year was Nil (Previous Year Rs.1.42 lakhs). STATEMENT UNDER CLAUSE 43 OF LISTING AGREEMENT Profitability Projected vis - a - vis achieved for the year 1996 - 97 (Rs. in lakhs) Projected Actual Total Sales 2475.00 6.78 Net Profit/Loss(-) 179.41 (-)174.83 For and on behalf of the Board, P.P. NANAVATY Chairman & Managing Director Place: Bangalore Dated: 15/11/1997