| The Members,
The Directors present to you the Annual Report and Audited Statement
of Accounts for the year ended 31st March, 2014.
1. FINANCIAL RESULTS (Rs. in crores)
2013-14 2012-13
Net Profit / (Loss) for the year (21.89) (21.95)
2. OPERATIONS
The year under review was highly volatile for the polyester industry
and witnessed extreme pressures both on top as well as bottom lines.
The increase in power cost for exorbitant increase in crude oil price
resulted in huge increase in cost of production. The Polyester industry
in India particularly has been suffering for incessant capacity
additions in past few years in a market which was already over
supplied. It has put pressure on the profitability of your company too
during the year under review.
During the year under review turnover of your Company is Rs. 91 crores as
compared to the turnover ofRs. 385 crores in the previous year. Your
company is able to reduce its net loss during the year under review
despite low turnover due to POY division remained closed for full year
and working of only DTY section with adverse market conditions and
global recession. The net loss during the year under review is Rs. 21.89
crores compared to the net loss ofRs. 21.95 crores in the previous year.
Your Company is relentlessly putting all its efforts to reduce the cost
and improve the operating margins but the profit of the company is
still negative. In view of accumulated losses, your directors are
unable to declare any dividend for the year under review.
3. EXPORTS
The worldwide recessionary trend prevailing in the global synthetic
textile market adversely affected the exports of POY/PFY from the
country. Despite of high volatility in the international market
spreading over the year under review, the Company has achieved exports
of about Rs. 27 crores during the year under review compared to the
exports ofRs. 36 crores in the previous year. Your Company is making all
fee efforts to explore the new markets and improve its market position
in the globe.
4. RESTRUCTURING OF DEBTS AND SANCTION OF REVIVAL SCHEME BY HON'BLE
BIFR
The Company is making continuous efforts for restructuring / settlement
of remaining dues. The Draft Rehabilitation Scheme submitted to the
Hon'ble BIFR with copy to Operating Agency (IFCI) in February, 2013 is
under examination with the Operating Agency and onward submission to
Hon'ble BIFR for circulation and sanction.
5. PUBLIC FIXED DEPOSITS
In view of the petition filed by the Company, the Hon'ble Company Law
Board had passed an order on 23.1.2002 that, "The repayment of Public
fixed deposits shall be made by the company in accordance with the
"revival scheme" as and when approved by the BIFR under the provisions
of SICA". However payments on compassionate grounds are being made
continuously by the Company as per the decision of the committee formed
by Hon'ble CLB for this purpose.
6. DIRECTORS
During the year under review, BIFR has withdrawn the nomination of Shri
P.P. Malhotra as a Special Director of the company and nominated Shri
Arun Chadha in his place as a Special Director of the Company. The
Board welcomes Shri Arun Chadha and places on record its appreciation
for the valuable contribution given by P.P. Malhotra during their
tenure as Special Director of the Company. Shri H. L. Sharma is liable
to retire by rotation and being eligible, offers himself for
re-appointment.
In compliance with the provision of Section 149 and other applicable
provisions of the Companies Act, 2013, Shri Niraj Rathore and Shri R.
Venugopal, Directors of the Company are proposed to be appointed as
Independent Directors of the Company for five consecutive years for a
term upto March 31, 2019. Appropriate resolutions for the
appointment/re-appointment of the aforesaid Directors are being moved
at the ensuing Annual General Meeting, which the Board recommends for
your approval.
7. AUDITORS
M/s. T. R. Chadha & Co., Chartered Accountants, Statutory Auditors of
the Company retires at the forthcoming Annual General Meeting. Your
Directors recommend their re-appointment to audit the accounts of the
Company. As required under the provision of the Section 139 of the
Companies Act, 2013 the company has obtained written confirmation from
M/s. T. R. Chadha & Co. that their appointment, if made, would be in
conformity with the limits specified in the said section. The
observations made by the Auditors are self explanatory and have been
dealt with in the notes forming part of the financial statements and
hence need no further clarifications.
8. INDUSTRIAL RELATIONS & PARTICULARS OF EMPLOYEES
Your Directors sincerely appreciate the workers, staff and officers for
putting their best efforts. The Company has enjoyed healthy and cordial
industrial relations throughout the year except the workers in the POY
section created labor unrest and the company has declared lock out in
its POY Divission form 15th November, 2012. There is no employee
getting remuneration as prescribed under Section 217 (2A) of the
Companies Act, 1956 read with Companies (Particulars of Employees)
Rules, 1975 as amended.
9. DIRECTORS' RESPONSIBILITY STATEMENT
Pursuant to sub-section (2AA) of Section 217 of the Companies Act,
1956, the Board of Directors of the Company hereby state and confirm
that:
(i) in the preparation of the Annual Accounts, the applicable
accounting standards read with notes on accounts have been followed
along with proper explanation relating to material departures;
(ii) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that were reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit or
loss of the Company of the year under review;
(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 for detecting fraud and other
irregularities;
(iv) the Directors have prepared the annual accounts on a going concern
basis.
10. PARTICULARS OF ENERGY CONSERVATION- TECHNOLOGY ABSORPTION AND
FOREIGN EXCHNAGE QVTGQ
The statement of particulars relating to energy conservation,
technology absorption and foreign exchange earnings and outgo as
required in accordance with Section 217 (1) (e) of the Companies Act,
1956 read with Rule 2 (A), 2 (B) and 2 (C) of the Companies
(Disclosures of particulars in the report of Board of Directors) Rules,
1988 is annexed hereto and forms part of this report.
11. CONSTITUTION OF AUDIT COMMITTEE
The Board of Directors has constituted the Audit Committee of Directors
to exercise powers and discharge functions as stipulated in Section 177
of the Companies Act, 2013. The present Audit Committee consists of
member directors as follows:-
Shri Niraj Rathore (Independent Director) - Chairman Shri R. Venugopal
(Independent Director) Shri H.L. Sharma (Non-Executive Director)
12. ACKNOWLEDGEMENTS
Yours Directors would like to express their appreciation for the
assistance and co-operation received from the Financial Institutions,
Government Authorities, Employees, Customers and Shareholders during
the year under review. Your Directors also appreciate the dedication
and efforts of executives, staff and workers of the Company.
ON BEHALF OF THE BOARD
Place: Mumbai (KAMALRANKA)
Date: 27th June, 2014 Chairman & Managing Director
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