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Leena Textiles Ltd.

BSE: 521198 Sector: Industrials
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Leena Textiles Ltd. (LEENATEX) - Director Report

Company director report

LEENA TEXTILES LIMITED ANNUAL, REPORT 1998-99 DIRECTORS' REPORT To The Members Your Directors have pleasure in submitting their Fifteenth Annual Report of the Company for the year ended 30th September, 1999. OPERATIONS During the year due to continuous recession in the textile industry, your Company has not received any job work orders. As the Company suspended the manufacturing operations, there was no production. In view of the suspension of operations and heavy losses reported above, your Directors regret their inability to recommend dividend. INDUSTRIAL RELATIONS It is unfortunate to bring to the notice of the Members that the Company suspended the manufacturing operations from 24th July, 1998 since the workers resorted to illegal strike without prior notice and submitted a charter of demands with more financial commitments when the Clause 12(3) of settlement is in force. In spite of efforts made by the management to mitigate the situation, the Workers did not call off their illegal strike. In view of this reason, the factory is under closure and the matter is pending adjudication before the Assistant Commissioner of Labour, Govt. of Andhra Pradesh, Tirupati. STATUS OF THE REFERENCE MADE TO BIFR As per BIFR directives advertisements were issued in the Economic Times and lea(ling Newspapers on 24.2.1999 and 6.3.1999 by the Operating Agency but no positive responses were received. The Hon'ble BIFR heard your Company's case on 21.10.1999. After hearing the submissions made by the Financial Institutions, Banks and the promoters of the Company and on a careful consideration of the facts of the case on record the Bench observed that despite making all possible efforts, it could not evolve any acceptable rehabilitation scheme for the Company as the Executive Director of the Company expressed his inability to revive the Company on his own and offers received for take-over of the Company fell much short of both the valuation of ;he assets as well as the outstanding loans of the secured lenders. The Hon'ble Members of the Bench, therefore, opined that as the Company's networth becoming positive under the circumstances of the case within a reasonable time frame and discharging all its liabilities/financial obligations was remote; it would be just and equitable in the public interest if the sick company i.e., LEENA TEXTILES LIMITED was wound u/s.20(1) of the SICA. The Hon'ble Bench formed an opinion to issue a Show Cause Notice in due course calling for objections/suggestions from the interested parties to the proposed winding-up of the Company. The Company is yet to receive the official Orders from the Hon'ble BIFR. DIRECTORS The Industrial Finance Corporation of India Limited, New Delhi has nominated Shri A.S.Rishi in place of Shri N.Sivaraman upto 28th October, 1999. However, subsequently, Shri Ramakrishnaiah has been nominated in place of Shri A.S.Rishi, whose nomination has been withdrawn, with effect from 29th October, 1999. The Board places on record its appreciation for the valuable services rendered by Shri N.Sivaraman and Shri A.S.Rishi during their tenure as Directors. Your Directors regret to report the sad demise of Shri B.V.R.S.S.Raju, a Director on your Company's Board and would like to-place on record the yeoman services rendered by him to your Company by late Shri B.V.R.S.S.Raju. AUDITORS M/s. Mogili Sridhar & Co., the Chartered Accountants retire at this Annual General Meeting and being eligible otter themselves for re-appointment as Auditors of the Company for the year 1999-2000. PARTICULARS OF EMPLOYEES In pursuance of the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of the Employees) Rules 1975, your Directors are to report that no employee was in receipt of remuneration of Rs.3,00,000/- or more per annum or Rs.25,000/- or more per month where employed for the part of the year. CONSERVATION OF ENERGY Information relating to Conversion of Energy, Technology Absorption & Foreign Exchange earnings pursuant to Section 271 (1) (e) of the Companies Act, 1956 read with Companies (Disclosure of particulars in the report of Board of Directors) Rules, 1988 is given below: 1. CONSERVATION OF ENERGY: During the period there was no production activity and production due to suspension of manufacturing operations. In view of this, implementation of energy saving measures does not arise. However, details are given below as per Form A. FORM B DISCLOSURE OF PARTICULARS WITH RESPECT TO TECHNOLOGY ABSORPTION RESEARCH AND DEVELOPMENT (R&D) No technology absorption either indigenous or imported is involved. As the Factory is closed. the Question of exploring possibilities of developing new varieties of yarn which give more value addition does not arise. 3. FOREIGN EXCHANGE EARNINGS AND OUTGO: a) Activities relating to exports, initiative taken to increase exports, development of new export markets for products and services and export plans: As the Factory is closed, no activities have taken place. b) Total Foreign Exchange used and earned: i) Foreign Exchange used : Nil ii) Foreign Exchange earned : Nil ACKNOWLEDGEMENTS Your Directors have pleasure in recording their appreciation for the assistance extended to the Company by Financial Institutions, viz., Industrial Finance Corporation of India Limited, Industrial Development Bank of India and Banks viz., State Bank of Hyderabad, State Bank of India, Bank of Baroda and various agencies of State and Central Government. Your Directors would like to thank all the Shareholders who have reposed confidence in this Company. for and on behalf of the Board of Directors S. VENKATASWAMY Director DR. G. G. SAGAR Director Place: Hyderabad, V. NATARAJAN Managing Director Date : 29.10.1999 G. MADHUSUDAN Executive Director