Directors present the Twenty Sixth Annual Report of the Company along with the Audited Balance Sheet and Profit and Loss Account for the year ended 31st March, 2014.

FINANCIAL RESULTS

(Rs. in Thousands)

                                                2013-2014    2012-2013

Sales & Other Income                               464806        69996

Profit(Loss) Before Interest                            -
Depreciation   &
Non Operative (Loss) / Profit                       59233        25709

Interest                                             8406           11

Depreciation                                         5725          437

Non-Operative loss                                      -            -

Profit (Loss) before Tax                            45102        25261

Profit (Loss) after Tax                             45102        25261

Prior year Adjustments                                  -            -
 
Loss brought forward                             (672688)     (697949)

Add: Additions on Amalgamations                    677575            -

Less reduction in equity share
capital                                                 -            -

Profit carried to Balance Sheet                     49989     (697949)

During the year under review, your Company has not accepted any deposits under the provisions of Section-58A of the Companies Act, 2013 and the rules made thereunder.

MERGER

The Board for Industrial Financial Reconstruction (BIFR) in their order dated 20th Dec. 2013 approved the merger proposal of M/s. Success Apparels Pvt. Ltd., (SAPL) with your company. Accordingly, your company filed necessary returns with the Ministry of Corporate Affairs on 20-01-2014 and the same has been approved. Your company initiated action for implementation of the Modified Draft Rehabilitation Scheme (MDRS). Your company, on merger started production on its own.

AUDITORS

The Statutory Auditors Messers Ishwar & Gopal, Chartered Accountants, retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. A certificate has been obtained from them to the effect that the appointment, if made will be in accordance with the regulations specified in the Companies Act, 2013.

CORPORATE GOVERNANCE

The Company has complied with all the requirements as per the Security Exchange Board of India (SEBI) guidelines for Corporate Governance.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956, with respect to Directors' Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts for the year ended March 31, 2014, the applicable accounting standards read with requirements set out under Schedule VI to the Companies Act, 1956, have been followed and there are no material departures from the same;

ii) the Directors have selected such accounting policies and applied them consistently and made judgments 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 31,2014 and of the profit of the Company for the year ended on that date;

iii) the Directors have taken proper and sufficient care 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; and

iv) the Directors have prepared the annual accounts of the Company on a 'going concern' basis.

PARTICULARS REGARDING CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS & OUTGO

A. CONSERVATION OF ENERGY

The company is taking all possible steps to conserve energy resources. Measures taken in this regard cannot be quantified and its impact on cost of production cannot be stated accurately. The Company is not covered in the list of industries which should furnish information in Form 'A' relating to energy consumption and energy consumption per unit of production.

B. TECHNOLOGY ABSORPTION :

1. Research & Development: The company constantly endeavours to improve the quality of its products.

2. Technology absorption, adaptation and innovation: the company has not imported any technology during the year under review.

INFORMATION PURSUANT TO SECTION 217(2A) OF THE COMPANIES ACT 1956, REGARDING EMPLOYEES

Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of the Employees) Rules, 1975 are not applicable to the Company.

PERSONNEL

Employee relations at all levels continued to remain cordial.

ACKNOWLEDGEMENT

Directors place on record their sincere appreciation for the assistance and co-operation received from the bankers, financial institutions. The Directors also place on record their appreciation for the support given and contribution made by the officers, staff and workers at all levels during the year. Directors thank the Government of India, particularly Ministry of Commerce and Finance and Government of Karnataka for their support during the year and look forward to their continued support.

For and on behalf of the Board of Directors

                                Sd /-
Bangalore-560 018          (K. VINOD BHAT)
30/5/2014                 MANAGING DIRECTOR
                          (DIN : 02359812)