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U G Hotels and Resorts Ltd.

BSE: 526463 Sector: Services
NSE: N.A. ISIN Code: INE692D01010
BSE 00:00 | 04 Feb U G Hotels and Resorts Ltd
NSE 05:30 | 01 Jan U G Hotels and Resorts Ltd
OPEN 3.99
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VOLUME 100
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Mkt Cap.(Rs cr) 3
Buy Price 0.00
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Sell Price 0.00
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OPEN 3.99
CLOSE 3.99
VOLUME 100
52-Week high 3.99
52-Week low 0.00
P/E
Mkt Cap.(Rs cr) 3
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

U G Hotels and Resorts Ltd. (UGHOTELS) - Director Report

Company director report

Directors' Report

TO THE MEMBERS

Your Directors have pleasure in presenting their Twenty Sixth Annual Report togetherwith the Audited Financial Statement of the Company for the Financial Year ended 31stMarch 2012.

FINANCIAL RESULTS:

The financial results for the year ended 31st March 2012 are given below:

(Rs. In lacs)

Particulars Year ended 31.03.2012 Year ended 31.3.2011
Total Income 168.10 244.69
PBDIT (30.38) 5.43
Interest 2.97 5.34
Depreciation 65.19 65.31
Profit/(Loss) Before Tax (98.54) (65.23)
Exceptional items 221.40 -
Profit/(Loss) before taxation (319.94) (65.23)
Tax Expense - -
Profit/(Loss) before taxation (319.94) (65.23)
Balance carried forward to B/S (1570.49) (1250.55)

DIVIDEND

In view of loss incurred by the company during the year under review your Directorsare unable to recommend any dividend for the year ended 31st March 2012.

BUSINESS

Company’s total income has been decreased from Rs. 244.69 lacs to Rs. 168.10 lacs.The main reason for lower income was due to not being able to undertake major up gradationof the Hotel facilities due to financial constraints low rate of Occupancy due to heavyrain in peak season and avoiding conferences at low rate.

CORPORATE GOVERNANCE

The Company is committed to the application of best Management Practices compliancewith law adherence to ethical standard. The Company has in all spheres of its activitiesadequate checks and balance to ensure protection of interest of all stakeholders. M/sBalika Sharma & Associates Practicing Company Secretaries has examined company’scompliance and have certified the same as required under the SEBI Guidelines. The saidcertificate appearing as annexure forms part of this report. A separate ManagementDiscussion & Analysis Report covering a wide range of issues relating to performance& business prospects is given as annexure to this report.

FIXED DEPOSIT

The company has not invited or accepted any fixed deposit from the public pursuant toSection 58A of the Companies Act 1956 during the year under review.

SUBSIDIARY COMPANY:

The Ministry of Corporate Affairs vide their letter no. 5/12/2007-CL-III dated February8 2011 has granted a general exemption under Section 212(8) of the Companies Act 1956for publication of the accounts of subsidiary companies subject to fulfillment of certainconditions. In view of the same your Company is also exempted from publication of theaccounts of its subsidiaries under the provision of Section 212 of the Companies Act1956. The accounts of the subsidiary companies are not separately included in the AnnualReport. However the consolidated Financial Statements of the Subsidiary in accordancewith relevant Accounting Standards of the Institute of Chartered Accountants of Indiaduly audited by the Statutory Auditors forms part of the Annual Report and are reflectedin the consolidated accounts.

The Financial Statements of the Subsidiary Company are available to the investorsseeking such information at any point of time. The Annual accounts of the subsidiarycompanies will also be available at the Registered Office of the Company.

DIRECTORS

In accordance with the provisions of the Companies Act 1956 and article of Associationof the Company Ms. Saroj Sharma Director of the Company retire by rotation at theensuing Annual General Meeting and offer herself for re-appointment. The Board ofDirectors are of the opinion that their continued association with the Company will bebeneficial to the Board and recommends their re-appointment.

DISPUTE & COMPROMISE WITH M/S UMAK INVESTMENT COMPANY PRIVATE LIMITED

Your Company had taken loan from M/s UMAK investment Company Private Limited for thepurpose of repayment of amount of one time settlement to IFCI & TFCI Limited. Furtherthe entire loan along with the upto date interest thereon has been settled by way ofsale/transfer of 814930 no. of equity shares of the promoters their relatives friendsand associates @ Rs 151/- per share. In addition to the above loan to the company M/s UmakInvestment Company Pvt. Ltd has also advanced Rs. 3.256 Crore to Promoters Directors ofthe company in their personal capacity the same has also been paid and settled along withup-to-date interest thereon by the Promoters Directors by way of sale/Transfer of 217470no. of equity shares @ Rs. 151/- per share as per the Memorandum of Understanding dated 15thMarch2007 between M/s UMAK Investment Company Private Limited Promoters Directors andthe Company. Thereafter with regard to repayment of above said loans a dispute hadarisen between the company and M/s Umak Investment Company Pvt. Ltd. The matter is stillpending with Hon’ble Delhi High Court.

Thereafter M/s Umak Investment Company Pvt. Limited along with Mr. AAkash Bajaj hasfiled petition under section 397/398 of the Companies Act 1956 before the Hon’bleCompany Law Board. After some hearing both the parties had submitted their compromiseoffer before the Hon’ble Company Law Board. Hon’ble Company Law Board in theirhearing held on 20th day of July 2009 had settled the dispute between M/s UmakInvestment Company Pvt. Limited the Company and its promoter Directors. As per the orderof Company Law Board both the parties shall withdraw their legal cases pending before thevarious courts/forums also reverse the adjustment entries as above explained. Subsequentto the order of Hon’ble Company Law Board the accounting entries passed in FinancialYear 2007-08 with regard to adjustment of loan of M/s Umak Investment Company Pvt. Limitedhave been reversed by the Board of directors of the company in their meeting held on 27thJuly 2009. Both the parties are in process for withdrawing their legal cases pendingbefore various courts/forums.

AUDITORS

The Statutory Auditors of the Company M/s. Sharma Goel & Company retire at theensuring Annual General Meeting and offer themselves for re-appointment. The Auditors havefurnished a certificate that their reappointment would be within the limits prescribedunder Section 224(1B) of Companies Act 1956.

ACCOUNTS AND AUDIT REPORT:

The Notes to Accounts referred to in the Auditors’ Report are self explanatoryand therefore do not call for any further comments. However in respect of dispute &compromise with M/S Umak Investment Company Private Limited the Board of Directors wishesto explain as under:-Company had taken loan from M/S UMAK Investment Company PrivateLimited for the purpose of repayment of amount of one time settlement to IFCI & TFCILimited. Further the entire loan along with the upto date interest thereon has beensettled by way of sale/transfer of 814930 no. of equity shares of the promoters theirrelatives friends and associates @Rs 151/- per share. In addition to the above loan tothe company M/s Umak Investment Company Pvt. Ltd has also advanced Rs. 3.256 Crore toPromoters Directors of the company in their personal capacity the same has also been paidand settled along with up-to-date interest thereon by the Promoters Directors by way ofsale/Transfer of 217470 no. of equity shares @ Rs. 151/- per share as per the memorandumof Understanding dated 15th March 2007 between M/s UMAK Investment Company PrivateLimited Promoters Directors and the Company. Thereafter with regard to repayment ofabove said loans a dispute had been arisen between the company and M/s Umak InvestmentCompany Pvt. Ltd.

Thereafter M/s Umak Investment Company Pvt. Limited along with Mr. AAkash Bajaj hasfiled petition under section 397/398 of the Companies Act 1956 before the Hon’bleCompany Law Board. After some hearing both the parties had submitted their compromiseoffer before the Hon’ble Company Law Board. Hon’ble Company Law Board in theirhearing held on 20th day of July 2009 had settled the dispute between M/s Umak InvestmentCompany Pvt. Limited the Company and its promoter Directors. As per the order of CLBboth the parties shall withdraw their legal cases pending before the various courts/forumsand also reverse the adjustment entries as above explained.

Subsequent to the Order of Hon’ble Company Law Board the accounting entriespassed in Financial Year 2007-2008 with regard to adjustment of loan of M/s UmakInvestment Company Pvt. Limited have been reversed by the Board of Director of the companyin their meeting held on 27th July 2009. A sum of Rs. 50 lacs (i.e. Rs. 30 lacs paid bycompany Rs. 10 lacs paid by promoter directors and Rs. 10 lacs by other) has been paid toM/s Umak Investment Company Pvt. Limited. The company is also in process for withdrawingthe legal cases pending before the various courts/forums. As on date company as well asits promoters director have complied the Hon’ble Company Law Board order. In view ofthe above your directors are of the opinion that the Balance Sheet now presents acomplete true and fair picture.

In respect of nonpayment of employer’s/employees contribution to provident fundService tax luxury tax and Vat amounting to Rs. 3.13 lacs Rs. 3.19 lacs Rs. 3.87 lacsRs. 8.14 lacs and Rs. 3.02 lacs respectively was due to financial crunch; however the sameshall be paid shortly. All dues in respect of Car loans have been delayed paid due tofinancial crunch. The Company has adequate Internal Control System commensurate with itssize and business. Company has not received declaration from Mr. Harmeet Ghai underSection 274(1)(g) of the Companies Act 1956.

LISTING OF SHARES

Your Company’s shares are listed and traded at Bombay Stock Exchange Delhi StockExchange and Ludhiana Stock Exchange. The Company has paid upto date listing fees to allStock Exchanges.

PARTICULARS OF EMPLOYEES

There was no employee who was in receipt of remuneration over & above the limitsprescribed under Section 217(2A) of the Companies Act 1956 as such no statement isfurnished under the said Section.

DIRECTOR’S RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217 (2AA) of the Companies Act 1956 theDirectors confirm that:

a) In the preparation of the Annual Accounts for the Financial Year ended 31stMarch 2012the applicable accounting standards have been followed along with properexplanations relating to material departures;

b) The directors have selected appropriate accounting policies and applied themconsistently and made judgements and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company as at 31st March2012and of the Statement of Profit & Loss of the company for the said period.

c) Directors have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 1956 forsafeguarding the assets of the company and for preventing and detecting fraud and otherirregularities; and

d) The Directors have prepared the accounts for the Financial Year ended 31stMarch 2012 on a going concern basis.

ENERGY CONSERVATION TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNINGS AND OUTGO:

Pursuant to Section 217(1) (e) of the Companies Act 1956 read with the Companies(Disclosure of Particulars in the Report of the Board of Directors) Rules 1988 (asamended) a statement giving the required information relating to energy conservationtechnology absorption foreign exchange earnings and outgo is as under:

a) FOREIGN EXCHANGE EARNINGS:

Conservation of Energy Technology Absorption Foreign Exchange/out go.

Foreign Exchange Earning l
Foreign Exchange Outgo NIL
b) RESEARCH & DEVELOPMENTS: NIL

c) TECHNOLOGY ABSORPTION ADAPTION & INNOVATION: NIL

1. Efforts in brief made towards technology absorption adaptation & innovation:NIL

2. Benefits derived as a result of above efforts: Does not arise

3. In case of Imported Technology: N.A.

d) CONSERVATION OF ENERGY: Particulars relating to conservation of energy pursuantto Section 217(1) (e) of the Companies Act 1956 read with the Companies (Disclosure ofParticulars in the Report of the Board of Directors) Rules 1988 is not applicable to thecompany. However electricity consumed during the Financial Year is as under:

CONSUMPTION OF ENERGY:

Power and Fuel Consumption: Year Ended 31.03.2012 Year Ended 31.31.2011
a) Electricity purchased:
- No. of Units Purchased 173066 229520
- Total Amount (Rs.) 1158157 1245045
- Rate/Unit (Rs.) 6.70 5.42
b) Own Generation (Through Diesel Generator):
- Hrs.(consumption) 303 221.40
- litre per hr. 30 30
- Rate/hr.(Rs.) 1220 1152

ACKNOWLEDGEMENTS

The Directors take the opportunity to express their grateful appreciation for the wholehearted and sincere cooperation your company has received from the various departments ofCentral and State Government Bankers Financial Institutions Customers Travel Agentssuppliers and Contractors as well as shareholders of the company during the year underreview. The Directors also wish to place on records the appreciation for the contributionmade by all the employees of all levels and hope that with their continued commitment anddedication the company could look forward to more profitable operations ahead.

By order of the Board of Directors
Place: New Delhi Umesh Phalpher
Date: 1st September 2012 Chairman