| Dear Members,
The Board of Directors of the Company submits the Twentieth Annual
Audited Accounts for the year ended 30th September, 2014 :
FINANCIAL RESULTS (Rs. in lacs)
Current Year Previous Period
(18th Months)
Profit / (Loss) before, interest,
depreciation, exceptional items
and tax (969) 405
Finance Cost (1802) (2575)
Depreciation (298) (448)
Profit / (Loss) before tax (3069) (2618)
Tax expenses - -
Profit / (Loss) for the year (3069) (2618)
DIVIDEND
The Company is a sick industrial company within the provisions of the
Sick Industrial Companies (Special Provisions) Act, 1985 (SICA) and the
Rehabilitation Scheme sanctioned by the Hon'ble BIFR, is under the
process of implementation. As per the provisions of the Scheme, no
dividend on Preference and Equity Share capital is permissible.
REHABILITATION SCHEME :
The Rehabilitation Scheme of the Company as sanctioned by the Hon'ble
BIFR vide its order dated 16th January, 2012 is under implementation.
As reported in the earlier accounts, pursuant to the said Scheme, the
Fertilizer Undertaking had been de-merged and transferred to Kanpur
Fertilizers & Cement Ltd (KFCL) with effect from 1st October, 2010,
leaving the tea operations with the Company.
PERFORMANCE OF THE COMPANY
In view of a severe drought in North Bengal during the beginning of the
season this year, the Company was lagging behind its estimated
production. The first significant rainfall was received as late as in
the first week of May, 2014 and that too it was not widespread.
Plucking was suspended at almost all the Company's tea gardens during
the month of April, 2014 due to non-availability of leaf.
The revenue from operations for the year ended 30th September, 2014 was
Rs.184.58 crones as against Rs.262.10 crones in the previous eighteen
months period. Own crop during the year was 129.80 lac kgs of tea as
against production of 220.81 lac Kgs. of tea in the eighteen months of
the previous period. 127.81 lac kgs of tea was sold at an average price
of about Rs.144.42 per kg in the current year as compared to sales of
181.29 lac kgs in the previous eighteen months period at an average
price of Rs.144.71 per kg. Continuing adverse weather conditions in
successive years in the Dooars and Terai areas caused the crop of the
Company to be behind the targets. The increase in selling price did not
improve the profitability due to lower production of tea, hike in the
wage cost of labour pursuant to Memorandum of Settlement (MOS) arrived
at amongst the Tea Association, Tea Plantation Workers Unions and the
West Bengal Government on 4 th November, 2011 and adverse impact of the
steep increase in the cost of coal, fuel oil, electricity, fertilizers,
agro chemicals, etc. The MOS with the workers, which was executed for
three years period, is now due for a fresh agreement effective from 1st
April, 2014 onwards.
Overall prospect of the tea business appears to be encouraging with a
strong demand for CTC teas in which the Company is engaged
predominantly.
The management has taken steps to revamp the operations of the tea
business. Working capital is being augmented and the current year
capital expenditure will improve long term prospects in generating
future profitability. The Company is in the process of replacing high
cost coal with alternative fuels i.e. waste wood / biomass, etc.
Modernization of spraying equipments are under process which will
reduce pest control cost. Application of organic fertilizers is under
consideration. Priority is also given for uprooting and replanting of
age old tea bushes in the tea estates of the Company to improve long
term prospects. Extensive replanting done over the last three years
will have a large bearing on crop in the immediate future.
With the efforts already undertaken, barring unforeseen circumstances,
it is expected that performance of the tea business of the Company will
improve significantly.
FIXED DEPOSITS
Pursuant to the Scheme sanctioned by the Hon'ble BIFR, the Company has
refunded fixed deposits in settlement of the dues of fixed deposits
holders and as on 30th September, 2014, refund warrants for 5428 fixed
deposit holders aggregating to Rs.608.98 lacs remain un-encashed and
requisite amounts are lying with the Bank for this purpose.
BOARD OF DIRECTORS
In terms of the provisions of the Companies Act and the Company's
Articles of Association, Mr. Shrivardhan Goenka shall retire by
rotation and being eligible, offers himself for re-appointment. The
Board has appointed Mr. Rajesh Sharma as Managing Director of the
Company for a period of three years with effect from 27th September,
2014. Mr. M.H. Chinoy who was appointed as Wholetime Director of the
Company with effect from 1st January, 2014, will cease to be a
Wholetime Director at the close of business hours on 31st December,
2014 being unable to continue as such. However, considering his long
association with the Company, the Board will retain his service as
Non-Executive Director of the Company effective from 1st January, 2015.
The Board recommends the appointment / re-appointment of the aforesaid
Directors at the ensuing Annual General Meeting.
Pursuant to Section 149 and other applicable provisions of the
Companies Act, 2013, the Board of Directors is seeking appointment of
Mr. T. S. Broca, Mr. R. K. Bhargava, Mr. D. Sengupta and Dr. A. L.
Ananthanarayanan as Independent Directors for a term of five
consecutive years i.e. upto the conclusion of the Twenty Fifth (25th)
Annual General Meeting to be held in the calendar year 2019. Details of
the proposal for appointment of Mr. Broca, Mr.Bhargava, Mr. Sengupta
and Dr. Ananthanarayanan have been mentioned in Statement pursuant to
Section 102 of the Companies Act, 2013 in the Notice of Annual General
Meeting. The aforesaid directors fulfill the conditions specified in
the Companies Act, 2013 and rules made thereunder for their appointment
as Independent Directors.
The Board is of the opinion that their continued association as
Independent Directors shall immensely benefit the Company. The Board
recommends their appointment as Independent Directors by the
shareholders.
SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS
Vide General Circular No. 2/2011 dated 8th February, 2011, the Ministry
of Corporate Affairs (MCA), Government of India, has granted a general
exemption to companies from attaching the Balance Sheet, Statement of
Profit and Loss and other documents referred to in Section 212(1) of
the Companies Act, 1956. Accordingly, the said documents are not being
attached with the Balance Sheet of the Company. A statement containing
brief financial details of the subsidiary companies for the year ended
31st March, 2014 is included in the Annual Report.
As required under the Listing Agreement entered into with the Stock
Exchange, a Consolidated Financial Statement of the Company along with
all its subsidiaries is attached. The Consolidated Financial Statement
has been prepared in accordance with the relevant Accounting Standards.
These Financial Statements disclose the assets, liabilities, income,
expenses and other details of the Company and its subsidiaries.
MANAGEMENT DISCUSSION & ANALYSIS REPORT
Management Discussion and Analysis Report for the year under review, as
stipulated under Clause 49 of the Listing Agreement with the Stock
Exchange, is presented in a separate section forming part of this
Report.
CORPORATE GOVERNANCE
A Report on Corporate Governance as stipulated under Clause 49 of the
Listing Agreement entered into with the Stock Exchange, is annexed
forming part of this Report. A certificate from the Statutory Auditors,
confirming compliance of conditions of Corporate Governance as
stipulated under the said Clause 49, is annexed forming part of this
Report. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN
EXCHANGE EARNINGS AND OUTGO The particulars relating to conservation of
energy, technology absorption and foreign exchange earnings and outgo
under 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, has been provided in the Annexure forming part
of this Report.
PARTICULARS OF EMPLOYEES
The Company continued to have cordial and harmonious relations with its
employees at all levels.
Particulars of employees as required under Section 217(2A) of the
Companies Act, 1956 read with the Companies (Particulars of Employees)
Rules, 1975, as amended, are given in the Annexure to this Report.
DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to the requirement of Section 217(2AA) of the Companies Act,
1956, the Directors hereby confirm that :
(i) in the preparation of the Annual Accounts for the year ended 30th
September, 2014 the applicable Accounting Standards have been followed
along with proper explanations and there are no material departures ;
(ii) such accounting policies as were reasonable and prudent were
selected in preparing the accounts and these were applied consistently.
Further judgments and estimates that were reasonable and prudent were
also applied in the course of preparing the accounts so as to give a
true and fair view of the state of affairs of the Company as at the end
of the financial year and of the loss of the Company for the year ended
30th September, 2014;
(iii) proper and sufficient care was 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 frauds and other irregularities;
(iv) the annual accounts have been prepared on a going concern basis.
MAINTENANCE OF A WEBSITE
The Website of the Company is functioning.
LISTING OF EQUITY SHARES
The Company's equity shares are listed with The National Stock Exchange
of India Ltd (NSE) as well as traded in the BSE Ltd. The Company has
paid the requisite listing fee to the Stock Exchange where the shares
of the Company are listed.
AUDITORS
The Statutory Auditors, Messrs Lodha & Co., Chartered Accountants, who
were appointed at the last Annual General Meeting held on 30th
December, 2013 have expressed their willingness for re-appointment as
Statutory Auditors at the ensuing AGM.
The Board, on the recommendation of the Audit Committee, has
recommended the re-appointment of Messrs Lodha & Co., Chartered
Accountants as Statutory Auditors for a consecutive period of three
years in accordance with Section 139 of the Companies Act, 2013. The
said Auditors have confirmed that their appointment, if made, shall be
within the limit laid down under the relevant provisions of the
Companies Act. Appropriate resolution seeking approval of the members
to the said re-appointment is appearing in the Notice convening 20th
AGM of the Company.
The observations in the Auditors Report have already been explained in
the Notes forming part of the Financial Statements and further
clarified as under :
Para 4(I)(a)-Outstanding long term loans and Advances have been
explained in Notes 10(a)(i) and 10(b)(i) to the financial statements.
These are group company advances given for strategic reasons and can
only be dealt with in terms thereof. Para 4(I)(b)-Regarding
non-ascertainment of impact of wage revision pending negotiation
thereof has been explained in Note 19(i) to the financial statements.
Para 4(I)(c)-Pursuant to the decision of the Hon'ble High Court at
Calcutta in similar matter with regard to levy of salami, under certain
circumstances the Company has filed an appeal against the imposition of
salami before the appropriate authority, has been explained in Note 26
to the financial statements. Para 4(I)(d)-As regards managerial
remuneration, necessary applications are pending for approval before
MCA, as explained in Note 27 to the financial statements. Pending
approval, the note and qualification is consequential in nature. Para
4(I)(e)-We are in the process of obtaining confirmations of debit and
credit balances including advances, trade receivables, trade payables
and other liabilities and necessary effects will be given on
reconciliation thereof as explained in Note 28 to the financial
statements.
ACKNOWLEDGEMENTS
The Directors of the Company wish to place on record their gratitude to
the various departments of the Central Government, Government of West
Bengal, banks, shareholders, vendors, customers and employees for their
continued support.
For and on behalf of the Board
Place : Kolkata G. P. Goenka
Dated : 18th November, 2014 Executive Chairman |