Gandhidham Spg & Mfg Company Ltd. के निदेशक की रिपोर्ट

Mar 31, 2015

Dear Members

The Directors hereby present their 52ndAnriual Report on the business, operations and state of affairs of the Company together with the audited financial statement for the year ended March 31st, 2015:

FINANCIAL HIGHLIGHTS

The Financial Results of the Company for the year 2014-15 are summarized as under:

Current Year Previous Year Particulars (Rs) (Rs.)

Gross Total Revenue 131053.00 2416015.00

Profit / (Loss) before Tax (694357.22) 529331.71

Less: Tax Expenses

1. Current Tax 0.00 443288.00

2. Short Provision of earlier years 25278.00 43646.71

3. Deferred Tax 0.00 0.00

Net Profit/ (Loss) after Tax (719635.22) 42397.00

Add: Amount brought forward (25781001.96) (25823398.96) from Last Year

Appropriations:

Proposed Dividend NIL NIL

Tax on Proposed Dividend NIL NIL

Transfer to General Reserve NIL NIL

Balance carried forward to (26645005.18) (25781001.96) Balance Sheet

DIVIDEND:

Due to accumulated losses occurred for past years, the Directors do not recommend any dividend for the Financial Year ended on March 31,2015.

TRANSFER TO RESERVE

During the financial year 2014-15 the Company has not transferred any amount to General Reserve. ,

STATE OF COMPANY'S AFFAIRS

The Company has ceased to be a manufacturing Company since July 1986. During the year, the Company earned income from interest on fixed deposits only.

Trading in the equity shares by Bombay Stock Exchange remained suspended throughout the year.

CHANGE IN NATURE OF BUSINESS:

There has been no change in the nature of the business of the company during the financial year.

MATERIAL CHANGES AND COMMITMENTS

There has been no material changes occurred subsequent to the close of the financial year of the company to which the financial statements relates and the date of the report.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATIONS IN FUTURE

There has been no significant and material order passed by any Regulators, Courts, Tribunal which has impacted the going concern status and future operations of the company. However the Company had received an interim order WTM/PS/08/CFD/June/2013 dated 04.06,2013 from Securities Exchange Board of India (SEB!) in reference to Compliance with the minimum Public shareholding. In this regard a personal hearing was held on July, 08 2015 with SEBI. No further communication has been received from SEBI.

INTERNAL FINANCIAL CONTROLS WITH REFERENCE TO THE FINANCIAL STATEMENT

The Company has in place adequate internal financial control with reference to financial statement.

DETAILS OF SUBSIDIARY. JOINT VENTURES AND ASSOCIATE COMPANIES

As on March 31, 2015, the Company does not have any subsidiary, Joint Venture and Associate company.

PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARY / JOINT VENTURE / ASSOCIATE COMPANY

As the company does not have any subsidiary or Joint Venture or Associate company, disclosure requirements of information about its performance and financial position is not applicable.

DEPOSITS

During the financial year 2014-15, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

SHARE CAPITAL

The Company has not issued any equity share with differential rights; Sweat Equity Shares, Employees Stock Options, Stock Purchase and therefore, disclosure requirements are not applicable.

EXTRACT OF THE ANNUAL RETURN

The Extract of the Annual Return in Form MGT-9 as required under Section 92 (3) and Rule 12 of the Companies (Management and Administration) Rules, 2014 is appended as an "ANNEXURE - A" to this Report.

PARTICULARS OF LOANS. GUARANTEES OR INVESTMENTS UNDER SECTION 186

The company has not given any Loan, or Guarantee or provided any security in respect of any loan or made any investment during the financial year.

PARTICULARS OF ENERGY CONSERVATION. TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Additional information on conservation of energy and technology absorption as required to be disclosed in terms of Section 134(3) (m) of the Act read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 is not applicable as the Company has stopped manufacturing operations with effect from 25.07.1986. However, your company has made necessary efforts to conserve the energy and have taken remedial measures, wherever necessary at regular intervals.

There has been no foreign exchange earnings antf outgo during the financial year.

DETAILS OF EMPLOYEES REMUNERATION

There were no employees during the financial year ended 31st March, 2015 who were in receipt of remuneration exceeding the prescribed limit pursuant to section 197 of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

There were no contracts or arrangements entered into by the Company in accordance with the Section 188 of the Companies Act, 2013. Accordingly, the disclosure of Related Party Transactions as required under section 134 (3) (h) of the Companies Act, 2013 in Form AOC 2 is not applicable

BOARD OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

Changes in composition of the Board - .

* The Company has designated Mr. Sukhraj A. Singhvi (DIN: 00246136) as a Whole Time Director fora period of 5 ponsecutive years commencing from 28th March, 2015.

* Pursuant to the provisions of the Companies Act, 2013 and in terms of SEBI circular, the Company has inducted Mrs. Kamladevi P. Jain (DIN: 07139242) as a women Director with effect from 28th March, 2015.

* Mr. Mukesh K. Chaudhary (DIN: 02775378) resigned as an Independent Director of the Company with effect from 31st March, 2015. The Board places on record its deep appreciation for the valuable contribution made by him during his tenure as Director of the Company.

* Mr. Rajkumar Gupta (DIN: 02616025) was appointed as an Additional Director (Independent) for a period of 5 consecutive years with effect from 25lh April, 2015, subject to consent by the Members of the Company at the ensuing Annual General Meeting.

Meetings of the Board

The Board of Directors of your Company met 5 times during the year to deliberate on various matters. .

independent Director's Statement

Independent Director's on your Company's Board have given declarations that they meet the criteria of independence as provided in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

Key Managerial Personnel

Mr. Mitesh Singh Chauhan was appointed as Chief Financial Officer with effect from 28"' March, 2015.

In terms of provisions of Section 203 of the Companies Act, 2013, Mr. Sukhraj A. Singhvi, Whole Time Director; and Mr. Mitesh Singh Chauhan, Chief Financial Officer are the Key Managerial Personnel of your Company.

BOARD EVALUATION

The board of directors has carried out an annual evaluation of its own performance, Board committees and individual directors pursuant to the provisions ot the Act The performance of the Boaid was evaluated by the Board after seeking puts from at the directors on the basis of the criteria such as the Board compositive and software effectivensss of board processes, information and functioning, etc. The performance of the committees was evaluated by the board after seeking inputs from the committee members on the basis of the criteria such as the composition of committees, effectiveness of committee meetings, etc. The Board and the Nomination- and Remuneration Committee ("NRC") reviewed the performance of the individual directors on the basis of the criteria such as the contribution of the individual director to the Board and committee meetings like preparedness on the issues to be discussed, meaningful and constructive contribution and inputs in meetings, etc. in addition, the Chairman was also, evaluated on the key aspects of his role, in a separate meeting of independent Directors, performance of non-independent directors, performance of the board as a whole and performance of the Chairman was evaluated, taking into account the views of executive directors and non-executive directors. The same was discussed in the board meeting that followed the meeting of the independent Directors, at which the performance of the Board, its committees and individual directors was also discussed.

DIRECTOR'S RESPONSIBILITY STATEMENT

Pursuant to Section 134 of the Act, the Directors state that:

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(b) Appropriate accounting policies have been selected and applied consistently and have 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 as at March 31,2015 and of the loss of the Company for the year ended March 31,2015.

(c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) The annual accounts have been prepared on a going concern basis.

(e) Proper internal financial controls were followed by the Company and such internal financial controls are adequate and were operating effectively.

(f) Proper systems are devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITY:

Section 135 of the Companies Act, 2013 with respect to requirements of constituting a Corporate Social Responsibility (CSR) Committee and formulating and recommending a CSR Policy to the Board does not apply to your Company, as your Company does not come under the threshold limits stipulated under Section 135(1) of the Act.

The Company is not required to constitute a Corporate Social Responsibility Committee as it does not fall within the purview of Section 135(1) of the Companies Act, 2013. Consequently, it is also not required to formulate a policy on corporate social responsibility.

RISK MANAGEMENT:

The Company has devised and implemented a mechanism for risk management and has framed a Risk Management Policy. The Policy provides for constitution of a Risk Committee, which will work towards identifying internal and external risks and implementing risk mitigation steps. Your Company has identified key risks such as operational, compliance, financial, which could be a constraint towards reviving the affairs of your Company.

PREVENTION OF SEXUAL HARASSMENT POLICY

The Company has in place a Prevention of Sexual Harassment policy in line with the requirements of the Sexual Harassment of Women at the Workplace (Prevention, Prohibition and Redressal) Act, 2013. There were no cases reported during the year ended March 31, 2015 under the Policy

NOMINATION AND REMUNERATION COMMITTEE

The Company's policy on director's appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and recommend to the Board a policy, relating to the remuneration for the directors, key managerial personnel and other employees has been attached as "AN NEXU RE-B" to this report.

AUDIT COMMITTEE:

The Audit Committee of the Board pursuant to Section 177(2) of the Companies Act, 2013 and Rule 6 of the Companies (Meetings of Board and its Powers) Rules, 2014 comprises following members as on 31st March, 2015:-

1. Shri. Harish K. Notani., Independent Director, Chairman.

2. Shri. Parasmal M. Jain, Director.

3. Mukesh K. Chaudhary, Independent Director.

VIGIL MECHANISM:

Your Company has in place a vigil mechanism for directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of your Company's Code of Conduct. Adequate safeguards are provided against victimisation to those who avail of the mechanism and direct access to the Chairman of the Audit Committee in exceptional cases is provided to them. The vigil mechanism is overseen by the Audit Committee.

AUDITORS

M/s Khimji Kunverji & Co, Chartered Accountants, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have confirmed that their appointment, if made, would be in conformity with the provisions of the Act and they are not disqualified for re-appointment. The Audit Committee and Board recommends the re- appointment of M/s Khimji Kunverji & Co, Chartered Accountants as Auditors for the financial year ending 31st March, 2016.

AUDITOR'S REPORT

There are no qualifications, reservation or adverse remark or disclaimer made by the auditor in their report, except Note 20(1) and 20(2) mentioned under the head "OPINION" in the Auditors' Report, which are self-explanatory. *

(a) SECRETARIAL AUDITOR

The Board has appointed M/s. Ratan Kapadia & Associates as Company Secretaries, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit report for the financial year ended March 31,2015 is annexed herewith as "ANNEXURE C".

SECRETARIAL AUDIT REPORT

Your Directors provide the following explanations and comments on the qualification or reservation or adverse remark or disclaimer mentioned in the Secretarial Audit Report:-

The Company is required to maintain minimum public shareholding as per the Securities Contracts (Regulation) Act, 1956 (SCRA) and the Rules made thereunder and Clause 40 of Listing Agreement read with Rule 19(2) and Rule 19A of the Securities Contracts (Regulation) Rules, 1957

The manner/method in which the minimum public shareholding requirement can be met is through:-

I) Issuance of shares to public through prospectus

II) Offer for sale of shares held by promoters to public through prospectus

III) Sale of shares held by promoters through secondary market i.e OFS through stock exchange.

IV) Institutional Placement Program (IIP)

V) Right Issues to Public shareholders, with promoters / promoters group shareholders with promoters / promoters group shareholders forgoing their rights entitlement.

VI) Bonus issues to public shareholders, with promoters / promoter group shareholders forgoing their bonus entitlement.

VII) Any other method as may be approved by SEBI, on a case to case basis.

With substantial erosion of Net worth of the Company, negligible operations, discontinuance of manufacturing activities, current financial health and considering a very small number of public shareholders in the Company, your directors feel that none of the above methods would generate any interest and therefore the Company would not be able to meet the criteria of minimum 25% public holding.

The Company has not provided the demat facility as required under the Depositories Act 1996 and the Regulations and Bve-te.ws frame thereunder and The Company has not appointed Registrars and Shar-j Transfer Agents as required under the Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations. 1993 regarding the Companies Act and dealing with client)

Due to various reasons stated above, your Directors did not find it feasible to dematerialize the equity shares of the Company and appoint Registrars and Share Transfer Agents.

Since the trading in equity snares is suspended, appointment of Depositories as well as Registrars and Share Transfer Agents and dematerialization of shares would not have any benefit to the shareholders.

Further the number of shareholders Is small and there is no request from any shareholders to dematerialize or transfer any shares.

Members of the Company were not provided e-voting facility to vote on all the resolutions passed at the saidAGM

There are only 163 public shareholders holding 39640 equity shares constituting of 1.18% of the total shareholding of the Company. All these shares are held in physical form and the concerned shareholders have not provided their e-mail id to the Company. Under the circumstances, the Company could not provide the E-voting facility to the members of the Company at the Annual General Meeting.

The Company has not appointed Company Secretary as required under the provisions of section 203 of Companies Act 2013

The Company has discontinued manufacturing operation since July, 1986. Considering the size of the operations and earnings of the Company it is not possible to attract qualified Company Secretary. Accordingly Company could not appoint a Company Secretary.

The Company has not redeemed 200000. 9.5% Redeemable Cumulative Preference Shares as required under the Companies Act. 2013.

The redeemable preference shares can be redeemed only out of

I) Profits of the Company

II) Proceeds of the fresh issue of shares

The Company has not generated adequate profits due to the closure of the manufacturing activities since July, 1986. Further as stated earlier the Company is not in a position to issue fresh capital. In view of the same, the preference shares could not be redeemed.

However all the preference shares are held by the promoters and their associates only.

Non-Compliance of various clauses of the Listing Agreement such as non-intimation of certain events to the stock exchange, publication of certain information, payment of listing fees and maintenance of website.

In the absence of a qualified Company Secretary and Compliance Officer certain provisions of the listing agreement could not be complied with However, such non-compliance were technical and the same were not material and had no adverse impact concerning the interest of the shareholders.

ACKNOWLEDGEMENT

The Board wishes to place on record their appreciations of the whole hearted and sincere co- operation received by the Company during the year from the employees, bankers and various Government authorities at all levels.

On behalf of Board of Directors

Sukhraj A. Singhvi Parasmal M. Jain Place: Adipur-Kutch Director Director Dated: 25th August, 2015 DIN : 00246136 DIN : 00486508

Registered Office: Spinning Mill Building P.O.: Adipur (Kutch) - 370 205. Gujarat State

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Mar 31, 2013

The directors present the 50th Annual Report and Audited accounts of the Company for the financial year ended 31st March 2013.

1. FINANCIAL RESULTS

The operations of the Company remained suspended during the financial year ended 31st March, 2013. During the year under review, the company has earned a net profit of Rs. 2,38,808.00 (previous year Rs. 25,83,201.00). Since there were losses in the past therefore a total loss up to the date is arrived at Rs. 2,58,23,398.96 (Previous year Rs. 2,60,62,206.96). Your Directors recommended this amount to be carried forward in the balance sheet.

2. DIVIDEND

In view of the accumulated losses, your Directors regret their inability to recommend dividend on Equity and Preference Share Capital of the Company for the year under review.

3. OPERATIONS

The Plant operations of the company remained suspended throughout the year as was since July 1986. The company has put up its facilities for rental and accordingly the income generated is from the leave and license source. All the income and expenses in this connection have been suitably accounted in the current year.

Your directors are also on looking for suitable projects for the revival of the Company, which can be finalized once all legal cases and other existing obstacles though in process are removed completely.

The Directors and Shareholders have been making temporary advances to the Company from time to time to meet its routine expenses. The outstanding amount payable to directors and Shareholders as on 31st March 2013 is Rs. 29,30,000/-, (previous year 24,00,000/-).

4. DIRECTORS :

In Accordance with the provisions of the Companies Act, 1956, and the Articles of Association of the Company Mr. Parasmal M. Jain and Mr. Haresh K. Notani retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for reappointment.

5. DIRECTORS RESPONSIBILTY STATEMENT :

Pursuant to section 217 (2AA) of the Companies (Amendment) Act, 2000 the Directors confirm that:

a) In the preparation of the Annual accounts, the applicable accounting standards have been followed.

b) The accounting policies selected and applied are consistent, and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and losses of the Company for the period ended 31st March, 2013.

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis, regarding para 4(vi) of the Auditor''s Report; your Directors are of the opinion that, if the activities of the company are revived all the assets shall be used appropriately.

6. DISCLOSURE UNDER SECTION 217 (1)(e) OF THE COMPANIES ACT, 1956 :

Since your company has not been in operation since 1986, therefore the statement or the particulars of Energy conversation, technology absorption and foreign exchange earnings and outgo as required under section 217 (1) (e) of the Companies Act 1956 read with Companies (Disclosure of particulars in report of Board of Directors) Rules 1988 do not apply.

7. CORPORATE GOVERNANCE :

Since the company is not in operation and competent staff is also not in place, the conditions relating to corporate governance as stipulated in clause 49 of the listing agreement with the Stock Exchange has not been complied with.

8. PARTICULARS OF EMPLOYEES :

In terms of provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended from time to time, the Company has no employees who were in receipt of the remuneration of Rs. 60,00,000/- or more per annum during the financial year ended 31st March, 2013 or Rs. 5,00,000/- or more per month during any part of the said year.

9. AUDITORS :

M/s. Khimji Kunverji & Company, Gandhidham, Auditors of the Company retires at this Annual General Meeting and are eligible for re-appointment. You are therefore requested to reappoint them as Auditors of the Company to hold office until the next Annual General Meeting and to fix their remuneration.

10. OBSERVATION OF AUDITORS :

The observations of the Auditors in their report mentioned in point no. 4(vi) have been suitably explained in Note No. 19(a), 19(d), 19(e) of the notes on accounts.

11. COMPLIANCE CERTIFICATE :

Compliance certificate from a company secretary in whole time practice is attached herewith.

12. ACKNOWLEDGEMENTS :

Your directors are thankful to all the authorities for their continued support and co- operation. Your directors hereby acknowledge the same.

On behalf of Board of Directors

Parasmal M. Jain Pradeep P. Jain

Place : Adipur-Kutch Director Director

Dated: 25th August 2013

Registered Office:

Spinning Mill Building

P.O.: Adipur (Kutch) - 370 205.

Gujarat State

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Mar 31, 2011

To the Members,

The directors present the 48th Annual Report and Audited accounts of the Company for the financial year ended 31st March 2011.

1. FINANCIAL RESULTS

The operations of the Company remained suspended during the financial year ended 31st March, 2011. During the year under review, the company has earned a profit of Rs. 22,34,618.00 (previous year Rs. 12,09,016.75). Since there were losses in the past therefore a total loss upto the date is arrived at Rs. 2,86,45,407.96 (Previous year Rs. 3,08,80,025.96). Your Directors recommended this amount to be carried forward in the balance sheet.

2. DIVIDEND

In view of the accumulated losses, your Directors regret their inability to recommend dividend on Equity and Preference Share Capital of the Company for the year under review.

3. OPERATIONS

The Plant operations of the company remained suspended throughout the year as was since July 1986. The company has put up its facilities for rental and accordingly the income generated is from the leave and license source. All the income and expenses in this connection have been suitably accounted in the current year.

Your directors are also on looking for suitable projects for the revival of the Company, which can be finalized once all legal cases and other existing obstacles though in process are removed completely.

The Directors have been making temporary advances to the Company from time to time to meet its routine expenses. The outstanding amount payable to directors as on 31st March 2011 is Rs. 24,00,000/-, (previous year 49,00,000/-).

4. DIRECTORS:

In Accordance with the provisions of the Companies Act, 1956, and the Articles of Association of the Company Mr. Pradeep P. Jain and Mr. Mukesh Kumar Chaudhary retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for reappointment.

5. DIRECTORS RESPONSIBILTY STATEMENT:

Pursuant to section 217 (2AA) of the Companies (Amendment) Act, 2000 the Directors confirm that:

a) In the preparation of the Annual accounts, the applicable accounting standards have been followed.

b) The accounting policies selected and applied are consistent, and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2011 and losses of the Company for the period ended 31st March, 2011.

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis, Regarding Para 4(vi) of the Auditor's Report; your Directors are of the opinion that, if the activities of the company are revived all the assets shall be used appropriately.

6. DISCLOSURE UNDER SECTION 217 (1)(e) OF THE COMPANIES ACT, 1956:

Since your company has not been in operation since 1986, therefore the statement on the particulars of Energy conversation, technology absorption and foreign exchange earning and outgo as required under section 217 (1) (e) of the Companies Act 1956 read with Companies (Disclosure of particulars in report of Board of Directors) Rules 1988 do not apply.

7. CORPORATE GOVERNANCE:

Since the company is not in operation and competent staff also not in place, the conditions relating to corporate governance as stipulated in clause 49 of the listing agreement with the Stock Exchange has not been complied with.

8. PARTICULARS OF EMPLOYEES:

There are no employees receiving remuneration in excess of Rs. 2,00,000/- per month, hence no statement under section 217 (2A) of the Companies Act 1956 has been attached.

9. AUDITORS:

M/s. Khimji Kunverji & Company, Gandhidham, Auditors of the Company retire at this Annual General Meeting and are eligible for re-appointment. You are therefore requested to reappoint them as Auditors of the Company to hold office until the next Annual General Meeting and to fix their remuneration.

10. OBSERVATION OF AUDITORS:

The observations of the Auditors in their report on accounts have been suitably explained in the notes on accounts.

11. COMPLIANCE CERTIFICATE:

Compliance certificate from a company secretary in whole time practice is attached herewith.

12. ACKNOWLEDGEMENTS:

Your directors are thankful to all authorities for their continued support and co- operation.

On behalf of the Board of Directors

Sukhraj A. Singhvi Chairman

Place : Adipur - Kutch Date : 15.07.2011

Registered Office: Spinning Mill Building P.O.: Adipur (Kutch) – 370 205. Gujarat State

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Mar 31, 2010

The directors present the 47th Annual Report and Audited accounts of the Company for the financial year ended 31st March 2010.

1. FINANCIAL RESULTS

The operations of the Company remained suspended during the financial year ended 31st March, 2010. During the year under review, the company has earned a profit of Rs. 12,09,016.75 (previous year Rs. 10,31,486.20). Since there were losses in the past therefore a total loss upto the date is arrived at Rs. 3,08,80,025.96. Your Directors recommended this amount to be carried forward in the balance sheet.

2. DIVIDEND

In view of the losses, your Directors regret their inability to recommend dividend on Equity and Preference Share Capital of the Company for the year under review.

3. OPERATIONS

The Plant operations of the company remained suspended throughout the year as was since July 1986. As presented in previous years report, your management has restored the factory building and got constructed boundry wall as required and necessary to protect the company assets in a shape that will give longer life in the times to come. All the expenses in the connection have been suitably accounted in the current year.

Your directors are also on looking for suitable projects for the revival of the Company, which can be finalized once all legal cases and other existing obstacles though in process are removed completely. In the mean time your directors have rented the property to earn on till new projects are conceived and become due for implementation.

The Directors have been making temporary advances to the Company from time to time to meet its routine expenses. The outstanding amount payable to directors as on 31st March 2010 is Rs.49,00,000/-, (previous year 57,00,589/-).

4. DIRECTORS:

In Accordance with the provisions of the Companies Act, 1956, and the Articles of Association of the Company Mr. Sukhraj A. Singhvi and Mr. Parasmal M. Jain retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for reappointment.

5. DIRECTORS RESPONSIBILTY STATEMENT:

Pursuant to section 217 (2AA) of the Companies (Amendment) Act, 2000 the Directors confirm that:

a) In the preparation of the Annual accounts, the applicable accounting standards have been followed.

b) The accounting policies selected and applied are consistent, and judgments and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and losses of the Company for the period ended 31st March, 2010.

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The annual accounts have been prepared on a going concern basis, Regarding Para 4(vi) of the Auditors Report; your Directors are of the opinion that, if the activities of the company are revived all the assets shall be used appropriately.

6. DISCLOSURE UNDER SECTION 217 (1)(e) OF THE COMPANIES ACT, 1956:

Since your company has not been in operation since 1986, the particulars of Energy conversation, technology absorption and foreign exchange earning and outgo as required under section 217 (1) (e) of the Companies Act 1956 read with Companies (Disclosure of particulars in report of Board of Directors) Rules 1988 do not apply.

7. CORPORATE GOVERNANCE:

Since the company is not in operation and competent staff is not in place, the conditions relating to corporate governance as stipulated in clause 49 of the listing agreement with the Stock Exchange has not been complied with.

8. PARTICULARS OF EMPLOYEES:

There are no employees receiving remuneration in excess of Rs. 2,00,000/- per month, hence no statement under section 217 (2A) of the Companies Act 1956 has been attached.

9. AUDITORS:

M/s. Khimji Kunverji & Company, Auditors of the Company retire at this Annual General Meeting and are eligible for re-appointment. You are therefore requested to reappoint them as Auditors of the Company to hold office until the next Annual General Meeting and to fix their remuneration.

10. OBSERVATION OF AUDITORS:

The observations of the Auditors in their report on accounts have been suitably explained in the notes on accounts.

11. COMPLIANCE CERTIFICATE:

Compliance certificate from a company secretary in whole time practice is attached herewith.

12. ACKNOWLEDGEMENTS:

Your directors are thankful to all authorities for their continued support and co- operation.

Place: Adipur - Kutch On behalf of the Board of Directors

Date: 15.07.2010

Sukhraj A. Singhvi Registered Office: Chairman

Spinning Mill Building

P.O. Adipur (Kutch) - 370 205.