MUKERIAN PAPERS LIMITED
ANNUAL REPORT 2000-2001
Mukerian Papers Limited
Your Directors have great pleasure in presenting the 25th Annual Report of
your Company alongwith the Audited Statements of Accounts for the year
ended on 31st March, 2001 and Auditors Report thereon.
OPERATIONS AND FUTURE PLANS
Your Directors are pleased to inform you that your Company has registered a
healthy growth of 82%, as total revenues up from Rs.4283.88 Lacs to 7793.09
Lacs during 2000-2001. Despite of above, the Net loss of the Company has
reached from 1029.96 lacs to 3659.04 lacs due to applicability of
Accounting Standard AS-16 (Borrowing Cost) issued by the Institute of
Chartered Accountants of India which is mandatory in nature, effective from
Before applicable of this Accounting Standard, interest on loan taken for
expansion projects was being capitalised. According to this, project in
which active development has interrupted, the interest cost on such
projects cannot be capitalised further. Interest amounting to Rs.2716 Lacs
have not been capitalised and charged to the Profit & Loss Account.
Besides above, the increase in Net Sale realisation of paper was not
commensurate with the increase price of inputs. The Net Sale realisation of
paper has increased from Rs.20203/- PMT from 1999-2000 to Rs.21726/- PMT in
2000-2001 and the cost of inputs i.e. straws, Caustic Soda, Chlorine and
Rice husk has increased from Rs.1356/-, Rs.12886/-, Rs.6513/- and Rs.1082/-
PMT respectively during 1999-2000 to 1496/-, Rs.15715/-, Rs.8608/- and
Rs.1415/- PMT respectively during the year 2000-2001.
For installation of soda recovery Plant at a capacity of 160 TPD and
upgradation of the existing paper machine from 100 TPD to 130 TPD, a
concrete Revival Proposal is being worked out in consultation with IFCI and
our Technical Consultants i.e. M/s Chem-Project Consultants Pvt. Ltd.
Besides this, the Company has taken various effective steps to reduce the
costs, which has resulted in saving of steam and power consumption PMT of
paper. Further the Company has been making the best efforts to maximise the
use of Sodium Sulphite, which is the cheaper substitute of Caustic Soda.
The results of these measures will be reflected in the current year's
With the implementation of all the aforesaid steps, the Company hopes that
it will recover in the near future. The management on its part has been
trying its best to bring the company to life at the earliest.
During the year Sh. S.K. Bhattacharya, Director of the Company has resigned
from the Directorship of the company. The IFCI Ltd. has nominated Sh. V.S.
Pandey as nominee Director on the Board of the Company vice Sh. N.K. Jain.
Dr. J.S. Chawla, Director of the company is retiring by rotation in the
forthcoming Annual General Meeting and does not offer himself for re-
Directors place on record their gratitudes for the services rendered by Sh.
S.K. Bhattacharya, Sh. N.K. Jain and Dr. J.S. Chawla during their tenure of
DIRECTORS' RESPONSIBILITY STATEMENT:
Pursuant to Section 217 (2AA) as inserted by Companies Amendment Act, 2000
your Directors hereby confirm:
(i) that in the preparation of the annual accounts, the applicable
accounting standards have been followed except as mentioned in Auditor's
(ii) that the Company has 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 Company has 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 Company has prepared the annual accounts on a going concern
Your Company has already constituted audit committee and at present, the
committee is having of the following directors:
1. Sh. N.K. Oswal
2. Sh. V.S. Pandey
3. Dr. J.S. Chawla
During the year, the company neither accepted nor renewed Fixed Deposits
u/s 58A of the Companies Act, 1956.
The Auditors' Report and Notes on Accounts are self explanatory and
therefore, do not call for any comments.
M/s S.Tandon & Associates, Chartered Accountants, Chandigarh are retiring
at the forthcoming Annual General Meeting and being eligible, offer
themselves for re- appointment.
The Company has received a consent letter Under Section 224(1)(B) from M/s
S.Tandon & Associates, Chartered Accountants, Chandigarh to act as
Statutory Auditors of the Company for the year 2001-2002. Your Directors
recommend the appointment of M/s S.Tandon & Associates, Chartered
Accountants as Statutory Auditors of your Company for your approval for the
current financial year.
Trading in equity shares of your company is compulsory, for all
shareholders, in the dematerialised form, with effect from November 27,
2000 in terms of the notification issued by the Securities and Exchange
Board of India (SEBI). At present 10% (approx.) equity shares of the
company are in electronic form with both the depositories.
REFERENCE TO THE BOARD FOR INDUSTRIAL & FINANCIAL RECONSTRUCTION UNDER SICK
INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985
On compilation of the balance sheet for the period ended 31.12.2000 it was
noted that the net worth has been completely eroded. As such the balance
sheet for the 9 month period ended on 31.12.2000 (representing part of the
F.Y.) was audited and reference u/s 15 (1) of SICA was filed before the
Hon'ble BIFR on 10.05.2001. Subsequently, balance sheet for the F.Y. ended
31.03.2001 has been prepared and duly audited. The net worth stands eroded.
The Statutory Auditor has observed in the MAOCARO report that the Company
has become a sick industrial company. The management has been advised that
the reference which has been filed on the basis of the part of F.Y. may not
be maintainable, therefore the reference is required to be filed on the
basis of the Balance Sheet drawn up as at the end of F.Y. The Company is in
the process of filing a fresh reference u/s 15 (1) of SICA on the basis of
the balance sheet for the F.Y. ended 31.03.2001. The Directors are hopeful
that with the rehabilitation scheme to be formulated by the Hon'ble BIFR,
the Company would be able to revive itself.
PARTICULARS OF EMPLOYEES U/S 217(2A)
The Company has not paid remuneration to any employee of the Company beyond
the prescribed limit under the provisions of Section 217(2A) of the
Companies Act, 1956, read with Companies (Particulars of Employees) Rules
1975, as amended.
DISCLOSURE OF PARTICULARS UNDER SECTION 217(1)(e) OF THE COMPANIES ACT,
Under the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules 1988, the detailed information is enclosed as per
The industrial relations during the year under review have been cordial.
The Directors wish to place on record their due appreciation for the
devoted services and sincere efforts made by the officers, staff and
workmen towards the progress of the Company.
Your Directors also place on record their appreciation for the assistance
and co-operation extended by Financial Institutions/ Banks and Specially to
our small investors.
By order of the Board of Directors
For MUKERIAN PAPERS LIMITED
Place : Chandigarh N.K. OSWAL
Dated : 6.7.2001 Chairman-cum-Mg. Director
ANNEXURE TO DIRECTORS' REPORT
INFORMATION AS PER SECTION 217 (1)(e) READ WITH THE COMPANIES (DISCLOSURE
OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988 AND FORMING
PART OF THE DIRECTORS' REPORT FOR THE YEAR ENDED ON 31ST MARCH, 2001.
(A) CONSERVATION OF ENERGY
(a) In pursuance of its policy to give high priority to Energy conservation
the Company has taken various measures like reinsulation of various
equipments, rationalisation of electric load etc.
(b) Adoption of Energy conservation measures as indicated above has
resulted in cost saving.
(B) TECHNOLOGY ABSORPTION (R & D)
1. Specified areas in which R & D Carried out by the Company.
(a) In improving quality of existing product and development of new variety
of Paper by improving product, quality and new pulp furnish.
(b) Benefits derived as a result of R & D
R & D efforts have enabled the Company to reduce consumption of inputs by
improving yield and efficiency and developing new varieties of Paper.
(c) Future Plan of Action
The Company is going to put stress on Power saving devices and optimum use
of steam thus resulting in reduction in overall cost of production.
(d) Expenditure on R & D:
Research and development is an on going process, in view of the fact that
the same set of people and machine which produce the goods are also engaged
in research and development activities, it is not possible to ascertain
precisely the expenditure incurred on research and development alone.
2. Technology Absorption, Adoption and Innovation
The latest technology has been adopted in various Plants for improving
production and product quality and reducing the consumption of scarce raw
material and energy.
3. Imported Technology (imported during the last 5 years) Nil
(C) FOREIGN EXCHANGE EARNINGS & OUTGO
(a) The Company Plans to develop market for export of Paper.
(b) Total Foreign Exchange used : Nil
(c) Total Foreign Exchange earned : Nil
DISCLOSURE PURSUANT TO LISTING AGREEMENT
Listing of Securities
At present, the securities of the Company are listed at Ludhiana, Delhi,
Mumbai, Bangalore and Ahmedabad Stock Exchanges. The listing fee for the
year 1998-99, 1999-2000, 2000-2001 and 2001-2002 to aforesaid stock
exchanges has not been paid due to severe financial crisis being faced by
the Company from last four years. It is being considered to pay the said