JCL LIMITED ANNUAL REPORT 2004-2005 DIRECTOR'S REPORT To The Share Holders, JCL Limited Ladies & Gentlemen Your Directors present the 20th Annual General Report on the affairs of the Company together with Audited accounts for the year-ended 31.03.2005. COMPANY CEASED TO BE A GOING CONCERN: It was reported to you earlier that several Shareholders have not paid the balance of allotment money and the calls in arrears stood at Rs.92.40 lakhs and that therefore the company could not take delivery of the equipment by paying the balance amount to the machinery suppliers. Added to this the delay in execution of the project has resulted in escalation of the project cost to a total of Rs.831.02 lakhs. It was also reported to you that because of non-payment of dues to the financial institutions the APSFC & APIDC have also seized the unit during September, 1997. It was also reported to you that your Directors efforts to raise additional funds did not fructify because of the seizure of the unit. Added to this APSFC auctioned all the assets seized for Rs.48.50 lakhs. The action resulted in a loss of Rs.2,94,70,548/-.It has also become necessary to write off the preproduction expenses as unfructuous which would have been otherwise capitalized. Thus the substrata of the Company has gone and it ceased to be a going concern. Consequential action to be taken under the provisions of the companies Act 1956 will be taken up during ensuing years. DEPOSITS: During the year under review the company has not accepted any deposits within the meaning of Sec.58 of the company's Act, 1956 read with company's (Acceptance of deposits Rules) 1975. DIRECTORS' RESPONSIBILITY STATEMENT: The Directors of your Company hereby report: i) that in the preparation of Annual Accounts for the year ended 31st March, 2005, the applicable accounting standards have been followed along with the proper explanation relating to material departure: ii) that the directors have 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 ended 31 March, 2005. iii) that the directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of Companies Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities: DIRECTORS We regret to report the sad demise of Mrs. D. Jyothirmayi, one of the promoter directors, Your directors place on record their appreciation of the services rendered by Mrs. D. Jyothir Mayi during her tenure as director. Sri. A.K. Rao, Director, retires at this meeting by rotation. Being eligible he offers himself for reappointment. PARTICULARS OF EMPLOYEES There are no employees coming under the purview of sEc.271 (2A) of the Company's Act, 1956 read with companies (Particulars of employees) Rules whose particulars are required to be furnished, AUDITORS You are required to appoint M/s J.S. Kameswara Rao & Co., as auditors for the year 2005-2006. By order of the Board of Directors Sd/- (D.A. CHOWDHARY) Managing Director Place : Hyderabad Date : 12.11.2005