SAJJAN TEXTILES MILLS LIMITED
ANNUAL REPORT 2000-2001
To The Members,
Your Directors have pleasure in presenting the 11th Annual Report of the
Company together with the Audited statement of Accounts for the year ended
on 31st March, 2001.
In view of loss suffered by the Company during the year, the Directors
regret their inability to recommend any Dividend.
During the year under review, the Company have started its TFO operations
on job work basis and earned job charges to the tune of Rs. 43.76 Lacs.
PRESENT STATUS OF REFERENCE TO B.I.F.R.
As you are aware that the Board for Industrial and Financial Reconstruction
has declared the unit as Sick Industrial unit under Section 3(1) (O) of
Sick Industrial Companies (Special Provisions) Act, 1985 vide its Order
dated 6th August 1998. The I.C.I.C.I. Ltd., has been appointed as operating
Agency for Rehabilitation. The Board has directed the company to submit its
Rehabilitation Scheme. On the hearing fixed on 13th October 2000, The Board
directed the Operating Agency to explore the possibilities of change in the
management of the Company and had also suggested to the Operating Agency to
issue advertisements in two leading National Dailies for a bidder, who
would submit rehabilitation proposal by 31st March, 2001. In response to
the advertisements in the Economic Times on 26.12.2000 and in the Hindu on
22.12.2000, there were no bidders. In the absence of any bidders, the
Company is running the unit on job work basis till today, of which the
Operating Agency, Banks and Financial Institutions are fully aware of. The
Company submitted to the Operating Agency its own Techno-Economic Viability
Study Report on 30-11.2000 profitability Projections on 20.02.2001 and also
Feasibility Study Report prepared by a conultant appointed by the Company-
M/s Gherzi Eastern Ltd., on 25.8.2001. In the joint meeting held on
8.6.2001 by the operating Agency, banks and Financial Institutions, the
rehabilitation package submitted by the Company has been discussed. During
the discussion, the Operating Agency and other consortium members arrived
at a conclusion that it is not possible for the company to bring in upfront
payment - No Lien Deposit of Rs. 25 Lacs as directed by BIFR. In view of
this, the Operating Agency placed before the consortium, two alternate
proposals. It was also suggested in the meeting by the Operating Agency
that the company will submit their own proposal for One Time Settlement
(OTS) of 100% of the principal of Rs. 1078.64 Lacs in full and final
settlement of dues. In response to this, the Company has now submitted the
OTS proposal on 25.08.2001 to the Operating Agency, Banks and Financial
Institutions towards settlement of 70% of principal dues. A decision in the
matter is awaited. But due to delay in submission of rehabitation proposal,
the Board directed to issue show cause Notice for winding up of the Company
u/s 20 (1) of the Act. The matter will be heard on 5th October, 2001. Your
directors have clear and honest intention to revive the unit.
PROCESSING UNDER FERA AND DE-CAUTION LISTING
The Enforcement Directorate of FERA have initiated proceedings on the
Company and its Directors under Section 18(2) and 18(3) of FERA 1973 due to
long outstanding of Export Bills of Basic Happy Ltd., U.K. based on a
letter dated 23rd March, 1996 from Reserve Bank of India. The Enforcement
Directorate examined Directors of the Company and heard their depositions
and being convinced that the non realisation of export bills was beyond the
control of the Company and its Directors, dropped the charges against the
company and its Directors.
Due to above reason, the company was put on caution list vide Reserve Bank
of India's order dated 23rd May 1996. However, the name of the Company was
removed from caution list vide Reserve Bank of India's Order dated 25th
June, 1999 passed under Section 18(9) of FERA 1973.
During the year under review, your Company have started its TFO operations
on Job work basis and the same is running very well till today. Your
company have also planning to start its Loom Plant subject to arrangement
of working capital in near future.
The Company has not accepted any deposits from the public during the year.
Shri. Suresh S. Jhunjhunwala Director of the Company retires by rotation at
the forthcoming Annual General Meeting and being eligible, offer himself
The term of M/s. S. C. Mehra & Associates, Chartered Accountants, as
Auditors of the Company expires at the conclusion of this Annual General
Meeting and they are eligible for re-appointment.
The observations and remarks given by the Auditors in their Audit Report
have been explained by giving suitable Notes to the Accounts and therefore
in the opinion of the Directors do not require further clarifications.
PARTICULARS OF EMPLOYEES
The Company has not employed any employee during the year under review,
whose remuneration was in excess of the limits prescribed Under Section 217
(2A) of the Companies Act, 1956 read with the Companies (Particulars of
Employees) Rules 1975. Therefore the details for the same is not required
to be given.
CONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION AND
FOREIGN EXCHANGE EARNINGS AND OUTGO
The information required Under Section 217 (i) (e) of the Companies Act,
1956 read with the Companies (Disclosure of the Particulars in the Report
of Board of Directors) Rules, 1988 in respect of conservation of Energy,
Research and development, technology absorption is not required to be given
as Company did not carry out any manufacturing activity during the year
ended 31st March, 2001. The Company has no incoming or outgoing of foreign
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to section 217 (2AA) of the Companies Act, 1956, the Directors
confirm that :
i) in the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures have been made
from the same.
ii) they have selected such accounting policies and applied them
consistently and made judgments and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company as at March, 31, 2001 and of the profit of the Company for the said
iii) to the best of the knowledge and information they have taken proper
and sufficient care for maintenance of adequate accounting records in
accordance with the provisions of the Companies Act, 1956 for safeguarding
the assets of the Company and preventing and detecting fraud and other
iv) they have prepared the accounts on a going concern basis.
Your Directors wish to express their thanks to the Members of the Company
for their continuing confidence in the Management and the Company.
For and on behalf of the Board
Shyamsunder B. Jhunjhunwala
Date : 3rd September, 2001.