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Shilpax Laboratories Ltd.

BSE: 524482 Sector: Health care
NSE: N.A. ISIN Code: N.A.
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Shilpax Laboratories Ltd. (SHILPAXLABS) - Director Report

Company director report

SHILPAX LABORATORIES LIMITED ANNUAL REPORT 2001-2002 DIRECTOR'S REPORT TO THE MEMBERS, Your Directors have pleasure in presenting the Fifteenth Annual Report and Audited Accounts of the Company for the year ended 31st March,2002 TRANSFER TO RESERVES : In view of losses suffered by the Company and erosion of Company's Net worth, no amount is transferred to the reserves. DIVIDEND : In view of losses suffered by the Company and erosion of Company's Net Worth, your directors have not recommended any divedend for the year 2001- 2002. OPERATIONAL PERFORMANCE : The sales turnover of the Company for the 12 months period was nil and other income amounting to Rs.42.14 lacs which is not actual income and is due to excess provision made for Income Tax during earlier years is written back. The net loss for the 12 months period are at Rs.86.18 Lacs as compared to Rs.131.80 Lacs in the previous period. Reduction in loss is due to Other In -come as mentioned above and reduction in expenditures.. PHARMACEUTIAL INDUSTRY: Your Directors have repeatedly reported since last few years that it has be en very difficult for the medium size pharmaceuticals Companies like yours, to withstand the sluggish market, dumping of low cost products by neighbouring countries, cut throat competition with big pharma houses and multinational companies. Many medium size Pharmaceuticals organisation have closed or not finding any escape routes. Our Company was no exception to this. Entry of MNC's only added to the woes of the already sucked mid sized pharmaceutical companies. NOTE ON SICKNESS OF COMPANY The Company made a reference to the BIFR under, sick Industrial Companies (Special Provisions) Act,1985 (SICA) on 15th september,1999 which was rejected by the BIFR. Against such order of the BIFR, the company made an appeal to the AAIFR and the order of the BIFR rejecting Company's reference was reversed.The AAIFR directed the BIFR to reconsider the reference afresh on merits. The BIFR on 26th March,2002 held that the Company does not qualify to be an 'Industrial Company' within the meaning of the Section 3(1) (o) read with section 3(1) (e) & (f) of the SICA. DISCLOSURE AS PER LISTING AGREEMENT: The Company's securities are listed at the following Stock Exchanges:- The Delhi Stock Exchange Association Ltd., 3/1, Asaf Ali Road, NEW DELHI - 110 002. The Stock Exchange Mumbai, Phiroze Jeepee Bhoy Towers, Dalal Street, MUMBAI -400 001. Jaipur Stock Exchange Ltd. Jawaharlal Nehru Marg, Malviya Nagar, JAI PUR - 302 017. The Company is in default for payment of Listing Fee to each of the above Stock Exchanges amounting Rs.1.57 Lacs. ENERGY CONSERVATION,TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO : Information of energy, technology absorption, foreign exchange earnings and outgo pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in Report of Board of Directors) Rules, 1988 are not required to be given as no manufacturing activities are being carried out since February, 1998. FIXED DEPOSITS: During the year under review the Company has not invited Fixed Deposits form the public and/or shareholders. Hence Section 58 A and 58 AA of the Companies Act, 1956 and Rules made under the Companies (Acceptance of Deposites) Rule, 1975 are not applicable. DIRECTORS: Sh.J.M.Gupta resigned form Directorship of the Company ans Sh. Ram Sharma was appointed as additional director w.e.f. 29-6-2002. The Company has been received a notice under Section 257 of the Companies Act, 1956 alongwith requisite deposit proposing canditaure for the office of Director. Sh. Arvind Bhargava retires by rotation and being eligible offer himself for appointment. AUDITOR'S REPORT/AUDITORS: M/s HarvinderArora & Associates,Chattered Accountants the statutory auditor of the company retire and being eligible offer themselves. for reappointment. M/s Harvinder Arora & Associates, Chartered accountants have furnished a certificate under Section 224 (1 B) of the Companies Act, 1956, to the effect that their appointments as Statutory auditors for the financial year 2002-2003 will be well within the limits as prescribed under the Companies Act, 1956. EXPLANATION ON QUALIFICATIONS MADE BY AUDITORS OF THE COMPANY: Pursuant to the provisions of Section 217(3) of the Companies Act, 1956 explanation on qualification made by Auditors of the Company in their Audit Report dated 29-6-02, are as under:- Para 3/4 of Annexure to Auditors Report: Present Directors promoted two other Companies and have been on the Board since inception. All Companies have became sick being in the same line of Business.Presently only promter Directors are on the Board of all Companies and independent professionals who were inducted on the Board have resigned due to sickness of Companies. This has resulted in common Management loans, where ever provided/taken/granted have been without any interest. Para 5/6 of Annexure to Auditors Report : Loans and advances granted by the Company related to previous years and in few cases company has initiated legal action by issuing them legal notices for recovery. Necessary action shall be taken for court proceedings if negotiation consequent upon issuing legal notice fail. Company has not immediately filed court proceedings due to liquidity crisis. Para 13 of Annexure to Auditors Report : Please refer note on sickness of the Company. The Company may prefer an appeal or file a fresh reference to the BIFR. COST AUDITORS: As per the directives of the Central Government,the Company is required to appoint a Cost Auditor to conduct the Cost Audit of the accounts maintained by the Company in respect of Bulk Drug. However in view of no manufacturing activities being carried but by the Company an application was made in the year 1998-99 to the Deptt. of Company Affairs, Cost Audit Deptt., Govt. of India for exemption. CORPORATE GOVERNANCE REPORT : The company is incompliance with most of the requirements of uniform code of corporate governance. A separate section as corporate governance report has been included in the Annual Report of the company. DIRECTORS RESPONSIBILITY STATEMENT: Directors hereby state that to the best of our effort: 1. In the preparation of Annual Accounts, the applicable accounting standards have been followed; 2. The Directors have selected such accounting policies and applied them consistently and made judgement and estimates that are reasonable and pretend so as to give a true and fair view of the state of affairs of the Company at the end of financial year and of the profit/loss of the company for that period. 3. We have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. 4. We have prepare the annual accounts on going concern basis. EMPLOYEES: There is no employee with respect to particular are required to be given in term of section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975. ACKNOWLEDGEMENT: The Directors take this opportunity to convey the deep sense of gratitude for the valuable assistance and cooperation extended to the Company by bankers, investors, customers, suppliers, employees & workers for their continued support for the working of the Company. On behalf of the Board of Directors Sd/- Place:Surajpur(U.P.) Arvind Bhargava Date :29th June, 2002 Chairman