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Riga Sugar Company Ltd.

BSE: 507508 Sector: Agri and agri inputs
NSE: N.A. ISIN Code: INE909C01010
BSE 00:00 | 18 May 9.97 0.47






NSE 05:30 | 01 Jan Riga Sugar Company Ltd
OPEN 9.96
52-Week high 14.38
52-Week low 5.35
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 9.96
CLOSE 9.50
52-Week high 14.38
52-Week low 5.35
Mkt Cap.(Rs cr) 14
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Riga Sugar Company Ltd. (RIGASUGARCO) - Director Report

Company director report



Your Directors have pleasure in presenting their Report and audited Accounts of theCompany for the financial year ended 31 st March 2021.


(Rs. in Lacs)

Financial Year 31st March 2021 Financial Year 31st March 2020
(a) Gross Turnover 7914.16 15313.22
(b) Operating Profit Before Finance Cost & Depreciation (1525.38) (407.76)
(c) Finance Cost 1757.59 1481.02
(d) Cash Accruals (3282.97) (1888.78)
(e) Depreciation & Amortization 518.61 521.18
(f) Profit (Loss) before extraordinary items (3801.58) (2409.96)
(g) Extraordinary Item of Exp./Income - -
(h) Profit (Loss) Before Tax (3801.58) (2409.96)
(i) Provision for Tax
- Deferred Tax 935.52 -
- Income Tax of earlier year - -
(j) Profit (Loss) After Tax (4737.10) (2409.96)
(k) Other comprehensive Income (net of tax) (17.40) (59.24)
(l) Total Comprehensive Income for the year (4754.50) (2469.20)


In view of continuous losses company is unable to pay Dividend.


During the year 2020-21 there was no production in sugar factory as sugar factory couldnot start its production. Thus the figures for the year ended 31st March 2021 vis -a-visprevious financial year ended 31 st March 2020 in respect of the Sugar Factory of yourCompany are given below:-

Financial Year 31st March 2021 Financial Year 31st March 2020
1. Duration of crushing (gross days) NIL 120
2. Cane crushed (Lac Qtls.) NIL 33.17
3. Recovery (%) N.A. 8.10
4. Production (Lac Qtls.) - NIL 2.69
The sales of sugar unit decreased by 54% from Rs. 135.02 Cr to Rs. 62.48 Cr

The crushing season 2019-20 started from 18th December 2019 and concluded on 29thFebruary 2020. Due to labour problems and strike during season period the recovery ofsugar affected resulting higher cost of production.

Due to Labour unrest Sugar season could not be started for the season 2020-21. Thesugarcane area of the company allotted to other sugar factories. Due to Non-availabilityof fuel and power Distillery could not run and subsequently due to labour unrestoperation of Boiler thus Distillery could not be started. There was no production ofSugar Molasses and Ethanol during the financial year 2020-21. So that PreviousYear/Quarter Figures are not comparable.

Since 30th September 2018 all Bank loans of the company are N PA. The bankers allowedHolding on operation subject to terms & conditions therein up to 30.09.2021.

Sugar sale price remained subdued during the year much below cost of production ofsugar.

The sale price of sugar was lower than cost of production. The central government fixedminimum floor price of sugar at Rs. 31 per kg which was announced to revise Rs.33 per kgfrom 1 st October 2020. However the cost of production of sugar on all India basis wasmuch higher and industry demanded floor price of Rs. 35-36 per kg which was not acceptedby the government which resulted in a loss on realizations. The parity between cane priceand sugar price is yet to be established.

Due to continuous abysmal lower recovery the sugar factory made huge lossess asmentioned below:--

Narkatiaganj Sidhwalia Hasanpur Harinagar Riga Majhaulia Gopalganj Bagaha
2018-19 11.31 10.33 11.23 10.71 8.01 10.00 10.36 10.35
2019-20 11.54 10.92 11.00 11.42 8.86 9.91 10.18 11.24

Continuing Losses

During last 10 years company has incurred Loss of Rs. 164 Cr. but still made repaymentof Term Loan of Rs. 79 Cr. and interest of Rs. 159 Cr. as enumerated below:-

Rs. in Lacs

11-12 12- 13 13-14 14-15 15-16 16-17 17-18 18-19 19-20 20-21 Total
Net Profit (Loss) (524) (350) (272) (1442) (506) (409) (2081) (4643) (2410) (3801) (16438)
Term Loan Repayment 1432 492 477 1066 786 1205 1410 1039 21 -- 7928
Payment of Interest 1571 1559 1318 1607 1435 1502 1765 1963 1481 1758 15959

Due to continuous losses for last 10 years there are cane price arrears to farmers.However the company has totally repaid the sugar cane price till season 2017-18.

Riga Sugar for last 6-7 years due to natural calamities disparity in sugar price &cane price closure of distillery on CPCB directions have faced tremendous problem.Cyclone Phailin in 2013 Cyclone Hud-Hud in 2014 Earthquake in 2015 Flood in 2017 and2019 have made great loss to company. The State Government had given assurance to help andvisited the area but no compensation was granted. In August 2017 and 2019 heavy flood alsocaused huge damage to our plant and sugarcane.

The incentive claim as declared by the State Government and other receivable from stategovernment are still pending for long time which the Government is not releasing. The sameamount could have been used for payment of cane price arrears for the season 2018-19.

Since the entire bank loans of the company had became an NPA in the year 2018-19 thebankers allowed holding on operation which is still going on.

Due to continuous losses the Net worth of the company is fully eroded which may havean effect on the entity's ability to continue as a going concern. However the Managementis still hopeful that with financial restructuring by the banks and financial assistancefrom the state and central government the company can still revive.

(1) The company has made request for following support from central and stategovernment if provided the company can be revived: -


(a) Ethanol Loan to NPA sugar factory who has defaulted in SDF

To increase the no of days of operation of Ethanol Plant from present restricted 270days to 330 days and consequential increase in plant capacity company have to installIncineration boiler and also install Modification System for which company has applied toCentral Government for approval Project so as to avail Term Loan from Bank with interestsubvention upto 6% p.a. for 5 years as per Scheme announced by the Central Governmentdated 15.09.2020. The same was sanction subject to payment of dues of LSPEF and SDF.

(b) Company have been deprived from Soft Loan Scheme announced by the CentralGovernment to Sugar Industry. In this regard the Principle Secretary Dept. of SugarcaneIndustry Govt. of Bihar vide letter dated 8.9.2020 has recommended to Central Governmentfor Soft Loan to Riga Sugar of Rs. 40 Cr. to pay-off the cane price arrears which isstill pending with the Central Government.

(c) MIEQ & Cane price Subsidy by the Central Government for the season 2018-19

The central government had announced cane price subsidy for the season 2018-19 at therate of Rs. 13.88 per qtl. However it was linked with compulsory export obligation knownas MIEQ. However there was loss on making export of sugar which the majority of weakcompanies like company could not bear and thus could not pay cane price subsidy to thefarmers and thus farmers are deprived of cane price subsidy. Company has demanded thatcentral government to pay Rs. 13.88 for season 2018-19 directly to farmers without linkingwith prior export obligation to weak and small sugar companies.

(d) Non-payment of 3rd and 4thqtr Buffer Stock Claim of 2018 Scheme of Rs. 123.74 Lacsand other penalty.

Buffer Stock claim for 3rd and 4th quarter as per Scheme of Buffer Stock dated 15thJune 2018 of Rs. 123.74 Lacs has been withheld because the company have not able toexport sugar in 2018-19 as per MIEQ because there was upfront loss on such export whichcould not bear.

For one fault of non-export which is reason beyond control the Company is penalized bymultiple ways as follow: -

i) Not given cane price subsidy of Rs. 13.88/- per quintal on cane crush of 45.25 Lacsqtl. in 2018-19 i.e. Rs. 6.29 Cr. which could have gone to farmers directly.

ii) Withholding of Buffer subsidy of 3rd and 4th quarter on date of Rs. 1.23 Cr whichwill go to the cane price arrears.

iii) Reduction of subsequent Buffer qty created in of 2019.

iv) Non-eligibility of the company to avail subsidized soft loan to pay cane pricearrears as per scheme dated 2nd March 2019 to pay cane price arrears to farmers of2018-19.


The company has made request for the following support from the State government. Ifprovided the company can be revived and it can come out of NPA: -

(a) Provide company additional cane price subsidy of Rs.40 per qtl. for the season2017-18 and additional cane price subsidy of Rs.30 per qtl. for the season 2018-19 overand above the subsidy announced for all Bihar sugar mills- This will ward-off theadditional losses incurred by us on account of lower Recovery for payment of cane price toFarmers.

(b) Provide company soft term loan of Rs. 40 crores at interest rate of 4% for periodof 10 years with moratorium of 5 years so that we can pay cane price for last season andcurrent season. The Bank has already agreed to provide second charge on Fixed Assets ofthe company toward security of such loan. But no action from state government.

The aforesaid amount can be paid directly to the farmers.

(c) Release of Bihar Soft Loan Interest subvention for the FY 2016-17 to 2020-21 Rs.493.45 Lacs.

(d) Reimbursement of Co-gen subsidy of Rs.156 lacs pending since last 2 years.

(e) Help farmers directly for procurement of High Yield variety of cane seed of CO 238for 2 years of Rs. 10 Cr.

(f) Compensation towards running sugar plant in scorching heat of April and May 2019as per direction of the state government in the interest of farmers in season 2018-19 andconsequent loss by way of extremely lower recovery estimated at Rs. 7.45 Cr.

Central Government action during the year

The Central Government announced the export policy for sugar albeit delayed by threemonths. In spite of multiple bottlenecks like shortage of containers or lower labouravailability at ports due to lockdown restrictions the sugar export from India isexpected to touch 6.8 MMT during the sugar season 2020-21 in comparison to ~5.8 MMT duringlast season. As a result the carry forward stock of sugar in the country as on 30thSeptember 2021 is expected to be around 9.5 MMT or around 4.5 months of sugarconsumption.

Fair & Remunerative Price (FRP) of sugarcane for the sugar season 2020-21 wasrevised to Rs. 285 per quintal from Rs.275 per quintal in the previous year (linked to abasic recovery of 10%).

The pricing methodology for ethanol remained unchanged. Ethanol prices are announcedannually by the Central Government based on a formula which factored the price of sugarand FRP of sugarcane to calculate ethanol procurement prices. Ethanol prices are delinkedfrom crude or petrol prices. Ethanol prices for the supply period from December 2020 toNovember 2021 were increased to Rs.45.69 Rs.57.61 and Rs.62.65 per BL for ethanolproduced from C-heavy molasses B-heavy molasses and direct cane juice/sugar syruprespectively compared to Rs.43.75 Rs.54.27 and Rs.59.48 per BL in the previous period.

Minimum Selling Price (MSP) of sugar was first fixed at Rs.29 per kg in June 2018 andlater increased to Rs.31 per kg in February 2019. MSP is the ex-factory price (excludingGST and transportation charges) below which no mill can sell sugar in India. Owing toIndia becoming a surplus sugar producer the MSP environment is expected to continue. TheGroup of Ministers' recommendation to revise the MSP from Rs.31 to Rs.33 per kg isawaiting Cabinet approval for long time.

Stock holding limits on mills in the form of maximum monthly sale quotas continued.

The export of 60 Lacs MT of sugar from India with WTO-compliant financial assistancewas announced.

A higher customs duty continues against the import of sugar. / A zero customs duty alsocontinues for the export of sugar.

The Central Government announced differential and attractive prices for ethanolgenerated from damaged/surplus food grains. Soft loans are encouraged through banks forcommissioning new distillery capacities or augmentation of existing capacities whichcould facilitate higher ethanol production and reduce the sugar surplus through thediversion of B-heavy molasses and direct cane juice/sugar syrup away from sugar toethanol.

The Department of Food & Public Distribution Government of India constituted aworking committee to look into the aspect of sugar cane price rationalisation and othermatters to present a long-term sustainable solution for the entire sugar eco-system afterdue consultation.

For long-term solution further proactive steps are required to be taken again onpriority basis in order to protect the interest of various stakeholders:

• Most of the sugar producing countries in the world including some of the largestviz. Brazil Thailand Australia and USA follow the Revenue Sharing Formula (RSF) to paycane price to farmers. India should also follow the same so as to achieve itscompetitiveness on the global front.

• Dr. Rangarajan committee as well as Niti Ayog have recommended the concept ofjoint implementation of FRP RSF and PSF

(Price Stabilization Fund) as a permanent long term solution for the sector; otherwisethe sector would continue to require Government support. Once the above formula is inplace miller's liability for cane price to be limited to the amount arrived at as perRSF farmers will continue to get FRP and the difference between the FRP and the RSF to bepaid from PSF. PSF has to be on a self-financing mechanism. State Advised Price (SAP) tobe done away with. Cane price to be allowed to be paid in instalments across the countryso as to ease the pressure on the working capital requirements of the sugar mills whichwill also support the sugar prices.

The All India sugar price and sugarcane price announced by Central Government as perFRP for last 9 years are depicted below:-

Year Sugar Price Price Sugarcane Price (FRP)
2011-12 2951 145.00
2012-13 3148 170.00
2013-14 2917 210.00
2014-15 2492 220.00
2015-16 3121 230.00
2016-17 3620 230.00
2017-18 3136 255.00
2018-19 3050 275.00
2019-20 3300 275.00
2020-21 3300 285.00

The sugar price during last 10 years increased by 12% whereas the sugarcane priceincreased by 97%.

Distillery Unit Financial Year 31st March 2021 Financial Year 31st March 2020
1. Production of Ethanol from Molasses (Lac BL) NIL 77.80
2. Supply of Ethanol (Lac BL) 25.98 58.73

There was no production during the year in Distillery.

Co-Gen of Power

During the year due to non-operation of sugar season there was no co-gen.

Bio-Compost Fertiliser

The company is using distillery effluent and press mud from sugar and otheragricultural waste to produce bio-compost which is very cost efficient. Thus the companyapart from treatment of effluent and zero discharge adding value. The company gotRegistration of Bio-compost under Fertiliser Control Order 1985 with Ministry ofAgriculture as per requirement of CPCB.


During the reporting period sugar segment contributed 85 percent of net sales of thecompany whereas Distillery accounted for 15 percent. The company identified two businesssegments in line with the Accounting Standard on Segment Reporting Segment- wise RevenueResults and Capital Employed as stated in Note No.25 (5) of financial statement enclosedwith the Annual Report.

Significant changes in key financial ratio:

i) Interest Coverage Ratio deteriorated from (0.28) to (0.87) due to increasedoperating loss. .

ii) Current Ratio deteriorated from 0.32 to 0.04 due to further increase in loss duringthe year and consequent depletion in Current Asset.

iii) Debt Equity Ratio: the total Debt of the company vis-a-vis shareholder fund arenegative both years.

iv) The Operating Profit Margin Percentage was negative both year which was (24.16) in2020-21 and (5.91) in 2019-20 due to no operation of plant and consequent loss.

v) Net Profit Margin was negative in both year (56.00%) in 2020-21 and (15.34%) in2019-20. This deterioration was due to loss because of no operation of plant.

vi) For both years both Net Worth and Return was negative and thus nothing to comment.



Sugar Industry is seasonal in nature and directly dependent on monsoon foravailability of adequate sugar cane. India is the largest consumer and second largestproducer of sugar in the world contributing over 15 percent of the world's sugarproduction through over 600 sugar factories situated in different parts of the country.The sugar Industry is the largest agro based industry in India. This industry alsoprovides valuable by-products like bagasse molasses and press mud. The availability ofthese by-products led to setting up of Alcohol/Ethanol/co-generation of Power and OrganicManure plants. Over 5 Crore farmers large number of agricultural labourer are involved insugarcane cultivation and its harvesting operations. The growth of sugar industry has apowerful impact on the rural economy. Integrated Sugar Industry (comprising sugarmolasses alcohol power and bio-fertilizer) enjoys annual turnover of over Rs. 100000Crore and contribute about Rs.5000 crore to the Central Government Exchequer by way ofGST beside state taxes on sugarcane and hefty taxes collected by state as excise and VATon sale of spirit in the state which run an estimated Rs. 10000 crores annually. TheIncome tax also contributes to the government coffer. Industry accelerates ruraldevelopment through farm employment as well as business opportunities in transport andcommunication.

Sugar has been declared as an 'essential commodity' under the Essential CommoditiesAct 1955. Under Sugarcane (Control) Order 1966 the Government of India fixes cane pricecalled Fair and Remunerative Price (FRP) for sugarcane every year based on therecommendations of the Commission on Agricultural Costs & Prices. However many stategovernment fixes higher cane price for the sugar factories in their state. In Bihar thereis no statutory provision of State Advised Price but actual cane price is fixed inconsultation with the state. CACP gives recommendation of cane price but government donot implement due to political consideration. Since last few year Central government isalso fixing floor price of sugar below which no sugar factory sale sugar. This is checkthe free fall of sugar price. However floor price is lower than cost of production.

Sugar Cycle

The Indian sugar industry is characterized by cycle of high and low sugar production.This cycle of 3-4 years is broadly of two types viz. Natural comprising climaticvariation water availability and pest attacks. The other is induced cyclicality whichhave sequence like -- higher sugar production and accumulation of stock -- decline insugar prices & profitability -- higher sugarcane arrears -- decline in area undercultivation & Lower cane production -- lower sugar production -- lower sugaravailability and stock and thus increase in sugar prices --- improved profitability &low cane arrears -- higher cane production -- higher sugar production and so on. Everytime the cyclicality reaches its low government have to step in to provide Fiscal supportin the form of Export subsidy Buffer Stock creation Interest Free Loans etc. For lastfew years the Central Government is aggressively promoting Ethanol production and thusallowing B-Heavy Molassess and syrup for production of Ethanol whose price is quiteattractive. This has led to diversion of excess sugarcane toward production of Ethanol andthus the famous sugar cycle is breaking its trend for last few years.

The fundamental problem of the Indian Sugar Industry is that there is no parity betweenthe price of raw material i.e. sugarcane and its finished goods of sugar i.e. Illogicalintervention of state government cause wide economical distortation in sugar industry. Inalmost all major sugar producing countries of the world the price of cane paid to thefarmers depends on realization from sugar.

Rangrajan Committee Report-Linkage of Raw Material Costs and Sugar Realization

The main recommendation of Rangrajan Committee report of the year 2012 regardinglinkage of cane price with sugar price and its by products has not been implemented sofar. The committee has suggested for revenue sharing model under which 70% of sugar valueand each of its major three by-products would be paid to farmers. Rangrajan Committee hasindicated a derived cane price formula. It indicates that cane price will not be anabsolute but linked to another variable. Cane price will be linked to the price of sugarin the market place. The higher the sugar realizations the greater will be the caneprice. This is an internationally tested model. This ensures that any increase in sectorsprofitability is equitably shared between its manufactures and growers. The cane growerwill not be treated outsider but as partner of entire value chain. The Rangrajancommittee has gone a step further in this proposed linkage; it has proposed a sharingpercentage at a level higher than what is practiced abroad which more than secures theinterest of farmers.

Fixation of cane price at high level than the market price of sugar should be madeillegal. Various committees and high-level committee like Rangarajan have said so.According to Rangrajan Commitee "A sugar unit without any by-products' business willhave to pay cane price of 70% of its revenue realisation while it will have to spend 30%on its functioning. On the other hand a sugar factory with by-products business will haveto pay cane price of 75% of its revenue realization from sugar. The cane price to be fixedtaking into account this formula."

Pollution Control- Zero Discharge Company

The Sugar and Distillery factories of the company are Zero Discharge Plants as pernorms of Central Pollution Control Board and Ministry of Forest and Environment. Thecompany treat the entire solid waste generated from Sugar factory which is generated inthe form of Press-mud and liquid generated from Distillery in the form of spent wash forproduction of Bio-Compost. For this the company has set-up Digesters MEE RO Lagoon andBio-compost facilities on more than 17 Acres of Land. The Digesters is capable ofgenerating bio-gas which is replacement of fossil fuel. The Bio-compost produced is richin all organic nutrients required for fertility of the land. The said bio-compost is soldto farmers who supply sugarcane to company and also to other farmers and even used in TeaGardens of Assam and Darjeeling.

The company is not only zero discharge company but is also generating economic valuefrom such waste products and rejuvenating the farm land through use of organic fertilizer.

As per revised norms of CPCB Distillery of the company has also installed CPU. Now toincrease number of permitted days of Distillery operation from present 270 days to 330days CPCB has prescribed installation of Incineration. Due to financial constraintscompany has not been able to install the same. However the Central government has notifiedscheme for interest subvention Loan from the Bank for financing of Incineration. Thecompany has applied for such subsidized loan and has been granted in-principle approval ofLoan of Rs.30 Cr. from central government subject to payment of dues of LSPEF and SDF.




India is largest consumer and second largest producer of sugar in the world. Majorconsumers are manufacturer of cold drink Biscuits Confectioneries and Halwais whichconstitute 70% of total consumption and rest 30% by ordinary consumer. There are hugescope for further increase in demand as India is still lagging behind from many advancedcountries in respect of per capita consumption of sugar. Thus there are opportunity inproduction and consumption of higher quantity of sugar in coming period.


The mandatory provision of ethanol blending of 10% have strong support for growth ofsugar industry. Ethanol production improves oil security and contributes to environmentalprotection. The Government has announced its policy decision and set aim to increase theethanol mixing with petrol at 20% by the year 2025 which was earlier 2025 and also mixingwith Diesel. The Government of India has announced package for financing of EthanolProduction Capacity including new Ethanol plant and expansion including financing ofPollution Control Equipment. The remunerative price of Ethanol from B Heavy and Syrup isleading to setting up of Ethanol Plant. Thus coming years the Ethanol is going to be majordriver for growth of sugar industry in the country.


Sugar Industry offer immense scope for renewal energy project on co-generation basiswhich provide clean energy. Due to this the increased demand of surplus bagasse has addedimputes to revenue generation. The Tariff policy for co-gen renewal power is alsolucrative in comparison to conventional power based on fusel fuel. At present sugarindustry in India is producing about 4000 MW of surplus power and supplying to grid.However there is potential of 8000 MW co-gen surplus power with the sugar industry.

Bio-Compost Fertiliser

The bio-compost fertilizer being produced by the company has got immense scope ofdemand in all major agriculture cultivation as it not only preserve the soil fromexcessive use of chemical fertilizer but also increase its fertility.


• No linkage of Sugar Price with cane price

• Unreasonable high cane price in comparison to sugar selling price.

• The sugar sector is exposed to political intervention cyclical downtrend.

• Natural Calamity.

FUTURE PROSPECTS/OUTLOOK Industry scenario and outlook

India began the sugar season 2020-21 (October to September) with an opening inventoryof around 10.7 MMT (Metric Million Tonnes). Sugar production for the current season isestimated at 30.8 MMT around 4.4 MMT higher than the previous season's production of 27.4MMT. In spite of the Covid-19 situation which necessitated frequent lockdowns thedomestic demand for sugar is expected to be around 26.0 MMT compared to 25.3 MMT in theprevious season.

The by-products of Power and Ethanol support the sugar industry to some extent. Theproactive policy of the central government to promote the production capacity of Ethanolwill have far reaching positive impact on sugar industry.

Ethanol sector in India A steady rise in ethanol blending is not only likely tomoderate crude oil import saving precious foreign exchange reserves but also encouragethe use of additional cane juice and other raw materials efficiently while protecting theenvironment from the release of poisonous vehicular exhaust gas. The new National BiofuelPolicy 2018 has fixed a target of achieving 20% ethanol blending with petrol by 2025withthe government targeting to achieve the 10% milestone of ethanol blending with petrol by2022.

Committee of the Board

The details of composition of Audit Committee and other committees of the Board ofDirectors alongwith the attendance thereof is provided in the Corporate Governance Reportforming part hereof.

Audit Committee

The composition and attendance at the audit committee meeting are as follow:-

Name of Members Status Date of joining during the year Date of leaving during the year
Mr. P.J.Bhide (Chairman) Independent & Non-Executive - -
Mrs. Sulekha Dutta -do- - -
Mr. Dilip Datta -do- - -
Mr.N.K.Parasramka Non Independent & Non Executive - -

Four meetings of Audit Committee held during the year on26.08.202015.09.202013.11.2020 and 11.02.2021.

Information pursuant to Section 134 of the Companies Act 2013

a. Extract of the annual return as provided under Section 92(3) of Companies Act 2013is enclosed -Annexure I

b. Eight meetings of the Board of Directors of the Company were held during the year on11.06.2020 23.06.2020 17.08.2020 26.08.2020 15.09.2020 13.11.2020 26.11.2020 and11.02.2021.

c. All the Independent Directors of the company have furnished declarations that theysatisfy the requirement of Section 149 (6) of the Companies Act 2013.

d. Relevant extracts of the Company's policy on directors appointment and remunerationincluding criteria for determining qualifications positive attributes independence of adirector and other matters provided in section 178(3) of Companies Act 2013 is enclosed -Annexure 11. We affirm that the remuneration paid to the Directors is as per terms laidout in the Nomination and Remuneration Policy of the company.

e. In the Auditors Report dated 23.06.2021 the Auditors have given Qualified Opinionin relation to the Financial Statements of the Company for the Financial Year ended 31March 2021. The basis for qualified opinion and Board's response in relation to the saidopinion are as under:-

Audit Qualification Board's Response
Due to the continuous Losses Company's Net Worth has been fully eroded. The Company has also defaulted in repayment of Borrowings to the banks and others. In view of the uncertainties involved these events and conditions indicate a material uncertainty which may cast a significant doubt on the Company's ability to continue as a Going Concern. The Company would be able to continue as a Going Concern with financial restructuring by the banks and financial assistance from the state and central government. The encouragement being given by the government toward augmentation of ethanol production by way of allowing ethanol production from B heavy molasses Direct Juice and food grains and interest subvention loan for expansion setting up and zero discharge equipment for Ethanol. The interest subvention loan being provided by the central government for installation of zero discharge equipment like incineration will help the company to remove the production bottleneck in distillery increase in capacity and production and also improvement in overall profitability. The company has already been given in-principle approval of Term Loan under interest subvention from Banks for Ethanol by central government subject to fulfilment of terms and conditions.

f. There has been no materially—significant related party transactions made by thecompany with the promoters the directors the Key Managerial Personnel which may be inconflict with the interest of the company at large. The company has formulated a policy onRelated Party Transactions and also on dealing with Related Party Transactions. The policyis disclosed on the website of the company ( All related partytransactions as placed before the Audit Committee has also received approval from theBoard. Your Directors draw attention of the members the Note No. 25(16)(B) to thefinancial statement which set out Related Party Disclosures.

g. Details of conservation of energy technology absorption foreign exchange earningsand outgo as prescribed vide Rule 8(3) of Companies (Accounts) Rules 2014 is enclosed -Annexure III

h. The company has laid down policy on risk assessment and minimization procedures andthe same is periodically reviewed by the Board. The Policy facilitates in identificationof risk at appropriate time and ensure necessary steps to be taken to mitigate the risk.Brief details of risks and concerns are given in this Board Report.

i. The corporate Social Responsibility Committee has formulated and recommended to theBoard a Corporate Social Responsibility Policy (CSR Policy) indicating the activities ofthe company. The Annual Report on CSR activities is not annexed herewith due to non-applicability of relevant provisions to the company due to losses.

j. In compliance with the Companies Act 2013 and Regulation 17 of the ListingRegulations during the year the Board adopted a mechanism for evaluating its performanceas well as that of its Committee and Individual directors including the Chairman of theBoard.

The evaluation of Independent Director was carried out by the entire Board and that ofthe chairman and Non-Independent directors were carried out by the I ndependent directors.

The Directors were satisfied with the evaluation results which reflected the overallengagement of the Board and its committee with the company.



(a) Delay in evolving a rational Sugarcane Pricing Policy having link with sugar priceis detrimental to growth of the industry.

(b) The output of sugar an agro-based product is influenced by climatic vagaries.

(c) Sugar Industry being cyclic in nature the growth is hampered during downtrend.


High cost of molasses due to greater demand is matter of concern for Ethanol BlendingProgramme.


Your Company has adequate systems and internal control procedures to safeguard theassets of the company and to ensure maintenance of proper accounting records. There isalso an Internal Audit System in place which reviews the key business and controls andalso test checks on routine transactions and reports deviations. Besides an AuditCommittee periodically reviews the functioning of the entire system.


Not applicable since from 30.09.2018 the company became NPA and continue to be NPA sofar and working under holding on operation.


There are no outstanding stock options and no stock options were either issued orallotted During the year.


Company has not made loans guarantees and investments covered under the provisions ofSection 186 of the Act.


The company has neither accepted nor renewed any deposit from public within the meaningof section 73 of the Companies Act 2013 read with Companies (Acceptance of Deposit)Rules 2014 during the year under the review.


(a) Statutory Auditors

Pursuant to the applicable provisions of the Act the members of the Company at theirAGM held on 18th September 2017 appointed M/s. Co M/s. Salarpuria &Partners. Chartered Accountants (ICAI Registration No. 302113E) Kolkata as theStatutory Auditors of the Company to hold office from the conclusion of the 36thaGm until the conclusion of the 41st AGM. The reports given by the AuditorsM/s. Salarpuria & Partners. Chartered Accountants on the financial statements of theCompany for the year ended 31 st March 2021 form part of this Annual Report and there isqualification and reservation and adverse remark given by the Auditors in their Reportswhich has been explained hereinabove. The Auditors of the Company have not reported anyfraud in terms of the second proviso to Section 143(12) of the Act.

(b) Cost Auditors

Pursuant to Section 148 of the Companies Act 2013 read with The Companies (CostRecords and Audit) Amendment Rules 2014 the cost audit records maintained by the Companyin respect of its Sugar activity is required to be audited. Your Directors have on therecommendation of the Audit Committee appointed M/s. Mani & Co. Cost Accountants(Firm

Registration No 000004) as the Cost Auditor to audit the cost accounts of the Companyfor the financial year 2021-22. As required under the Companies Act 2013 theremuneration payable to the cost auditor is required to be placed before the Members in ageneral meeting for their ratification.

(c) Secretarial Auditor and Secretarial Audit Report

In pursuance of section 204 of the Companies Act 2013 Mr. Rajan Singh CompanySecretary appointed as secretarial Auditors to carry out Secretarial Audit for thefinancial year 2020-21 Their report is annexed to this report as Annexure-IV. The contentsof the said Audit Report are self explanatory and do not call for any further comments bythe Board. The Secretarial Audit Report does not contain any qualification reservationadverse remark or disclaimer.


The Board of the Company has an appropriate mix of Executive and Independent Directorsto maintain the independence of the Board and separate its functions of governance andManagement. As on 31st March 2021 the Board consists of 5 members one of whom wasexecutive director one non-executive non-independent director and three were independentdirectors consisting of one lady director.

The Board periodically evaluates the need for change in its composition and size.

The Members of the Company at the 35th Annual General Meeting ('AGM') held on 30thSeptember 2016 approved the appointment of Mr. Dilip Datta (DIN: 00406151) as anIndependent Director of the Company for a period of five years with effect from 30thSeptember2016. Mr Dilip Datta will complete his first term on 29th September2021. On therecommendation of the Nomination & Remuneration Committee the Board of Directors ofthe Company ('the Board') at the meeting held on 23rd June2021 appointed Mr Dilip Dattaas Additional Director in the Capacity of Independent Director of the company with effectfrom 30th September2021 subject to approval of the shareholders in the ensuing AnnualGeneral Meeting.

Consent of the Members by way of Special Resolution is required for appointment of Mr.Dilip Datta in terms of Section 149 of the Act and Regulation 17 of the ListingRegulations. Notice under Section 160 of the Act proposing the re-appointment of Mr. DilipDatta has been received by the Company and consent has been filed by Mr. Dilip Dattapursuant to Section 152 of the Act.

As Mr. Dilip Datta has attained the age of 75 years on 7th September2020 approval ofShareholders by way of Special Resolution was taken in last Annual General Meeting held on30th December2020 for his continuance as Independent Director for his first term

Again for his re-appointment as Independent Director for 2nd term the Board ofDirectors in their meeting held on 23rd June 2021 made recommendation subject to approvalof the shareholders by way of special resolution in the ensuing Annual General Meeting.

Further pursuant to the provisions of Section 149 of the Companies Act 2013 and Rulesmade thereunder members approval by way of Special Resolution is sought at the ensuingAnnual General Meeting for re -appointment of Mr. Dilip Datta as Independent Directorstill 45th Annual General Meeting or 30th September 2026 whichever is earlier.

The Company has received declaration in writing from Mr. Dilip Datta that he meet thecriteria of independence as provided in Section 149(6) of the Act and Regulation 16(1 )(b)of the SEBI Listing Regulations 2015.

In the opinion of the Board Mr. Datta fulfills the conditions specified in theCompanies Act 2013 and rules made thereunder and Regulation 16(1 )(b) of the SEBI ListingRegulations 2015 for his re- appointment as an Independent Director of the Company. TheBoard also considers that his association would be of immense benefit to the Company andit is desirable to avail his services as an Independent Director on the Board of theCompany.

Considering the skills experience knowledge Mr. Datta possess and the report ofperformance evaluation of Mr. Datta the Board recommended for the approval ofshareholders by way of special Resolution.

For disclosure as per SEBI (LODR) Regulations 2015 brief details includingqualification and expertise of directors to be appointed / re-appointed has beenmentioned in the Notice of the 40th Annual General Meeting of the company.

Mrs. Richa Ajitsaria (DIN09243468) was appointed as an Additional Director by the Boardof Directors with effect from 29th July 2021 and thus hold office till the date ofensuing annual general meeting. Based on recommendation are nomination and remunerationcommittee the board recommend appointment of Mrs. Richa Ajitsaria an independent womenDirector in the next Annual General Meeting.

Mr. Nirmal Kumar Parasramka (DIN00086584) resigned from Directorship of the company on05-05-2021 on personal ground. The Board record it deep appreciation for the serviceprovided by him.

Declaration by Independent Directors

The Company has received declarations from all the I ndependent Directors of theCompany confirming that they meet the criteria of independence as prescribed both underthe Act and Regulation 16 of the Listing Regulations. The Board of Directors confirm thatthe Independent Directors appointed during the year also meet the criteria of expertiseexperience and integrity in terms of Rule 8 of the Companies (Accounts) Rules 2014 (asamended).

Separate Meeting of Independent Directors

Details of the separate meeting of Independent Directors held in terms of Schedule IVof the Act and Regulation 25(3) of the Listing Regulations are given in the CorporateGovernance Report.


Your Directors state that:-

(i) in preparation of the annual accounts for the year ended 31 st March 2021 theapplicable accounting standards have been followed alongwith proper explanation relatingto material departures if any ;

(ii) the Directors have selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company and of the loss of the company as on 31stMarch 2021;

(iii) the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act 2013for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

(iv) the Directors have prepared the annual accounts on 'going concern' basis;

(v) the Directors have laid down internal financial controls to be followed by thecompany and such internal financial controls are adequate and are operating effectively;and

(vi) directors have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems are adequate and operating effectively.


The particulars of employee as required under Section 197 (12) of the Companies Act2013 read with Rule 5(1) and Rule 5(2) of the Companies (Appointment and Remuneration ofManagerial Personnel) Rules 2014 are given as separate annexure attached hereto and formspart of this report as Annexure- V.

During the year under review no complaint/case was filed pursuant to Sexual Harassmentof Women at Workplace (Prevention Prohibition and Redressal) Act 2013.


The Corporate Governance form an integral part of this Report and are set out asAnnexure- VI to this Report. The certificate from the Auditors of the company certifyingcompliance of condition of Corporate Governance stipulated in Regulations 34(3) of theListing Regulations is also annexed to Report on Corporate governance.


Regulation 34(2) of the Listing Regulations inter alia provides that the annualreports of the top 1000 listed entities based on market capitalization (calculated as onMarch 31st of every financial year) shall include a Business Responsibility Report. Thecompany do not fall under this category.


In compliance of provisions of section 203 of the Companies Act 2013 the followingpersons were the key managerial personnel of the company during the year:

(i) Mr. O.P.Dhanuka Chairman & Managing Director

(ii) Mr. B.K.Bhartia Company Secretary .

(iii) Mr. J.K.Pachisia CFO

The other details pertaining to KMP of the company their appointment/cessation duringthe year under review and their remuneration have been provided in the Extract of AnnualReturn annexed hereto and forming part of this report.

Code of conducts and ethics

The Board of company has adopted a Code of Conducts and ethics for the Directors andSenior Executives of the company. The code is available on the company's website

Significant & material orders passed by the regulators

During the year under review no significant and materials orders were passed by theRegulators or courts or Tribunals impacting the going concern status.

Whistleblower Policy

The company has in place a whistleblower policy to deal with unethical behaviorvictimizations fraud and other grievances or concerns if any. The Whistleblower policycan be accessed on the company's website

Disclosure under the Sexual Harassment of Women at Workplace (Prevention Prohibitionand Redressal) Act 2013.

The Company has in place an Anti Sexual Harassment Policy in line with the requirementsof The Sexual Harassment of Women at the Workplace (Prevention Prohibition and Redressal)Act 2013. Internal Complaints Committee (ICC) has been set up to redress complaintsreceived regarding sexual harassment. All employees (permanent contractual temporarytrainees etc.) are covered under this policy. No sexual harassment complaints werereceived during the year 2020-21.

Risk Management Policy

The Company has Risk Management committee of Directors to have a system of RiskManagement inter alia to review it periodically.

Policy for Preservation of Documents

The Policy for preservation of documents are stated in website of the

Material changes and commitments affecting the financial position of the company after31st March 2021 Material Changes and Commitments

Except those disclosed in this Annual Report there are no material changes andcommitments affecting the financial position of the Company between the end of thefinancial year i.e. 31st March 2021 and the date of this Report. The impact of COVID 19pandemic has not been material on the financial performance of the Company. However therewas delay in compliance due to non-filing of timely return and result.

Subsidiaries Joint Ventures or Associate Companies

There is no subsidiary Joint Venture or Associate of the company under meaning ofCompanies Act 2013.


The Shares of the Company are listed on The Calcutta Stock Exchange Ltd. and BSE Ltd.The Company has paid Listing Fees to BSE Ltd for 2021-22.


The Annexure referred to in this report and other information which are required to bedisclosed are annexed herewith and forms a part of this report of the Directors:-

Annexure Particulars
I Extract of the Annual Return as per form MGT-9
II Policy on selection & Remuneration of Directors Key Managerial Personnel and other employees and on Board Diversity
III Particulars of Conservation of Energy Technology Absorption and Foreign Exchange earnings and outgo
IV Secretarial Audit Report
V Particulars of Employees
VI Corporate Governance Report


Your Directors express their appreciation for the support and contribution by CaneGrowers Bankers Central and Bihar State Government Suppliers Customers and thevaluable services rendered by the Employees at all levels.

For and on behalf of the Board
Kolkata O. P. Dhanuka
Dated : 6th August 2021 (DIN:00049947) Chairman & Managing Director