Your Directors have pleasure in presenting the 39th Annual Report and
Audited Statement of Accounts of the Company for the year ended on 31st March,
||2008-2009 (Rs. in Lacs)
||2007-2008 (Rs. in Lacs)
|Loss before depreciation, interest, taxation and extraordinary items
|Add/Less: Prior Period adjustment / exceptional /extraordinary items
|Deficit as per last year
|Less: Provisions for Deferred Tax Assets/ Liabilities (Net)
|Less : Debenture Redemption Reserve &Capital Reserve W/back
|Adjusted against General Reserve
|LOSS CARRIED TO BALANCE SHEET
The company continued to face liquidity problem through out the year, as a result
of which production was severely affected. The company achieved a production of 1555 M.T.
and a turn over of Rs.6010.34 lacs during the year as against the production of 2641 M.T.
and a turn over of Rs. 10840.94 lacs during the previous year.
The company's export during the year under report amounted to Rs 3610.56 Lacs (FOB
Value) as against Rs. 5502.98 Lacs during the previous year.
Owing to the losses incurred by the company, your directors express their inability
to recommend payment of dividend on the equity shares for the year under report.
The acute shortage of Working Capital continues to haunt the operation of the
company. The company is making serious efforts to locate a strategic investor to finance
the working capital and also make one time settlement with its secured lenders. Future
outlook of the company will depend upon the success of company's efforts to locate a
Some of the workers went on an illegal strike with effect from 04.04.2007 and the
strike is still continuing, otherwise industrial relations had been generally
Shri B.L.Kanunga and Shri M.K.Kanunga retire by rotation at the 39th Annual General
Meeting and being eligible offer themselves for reappointment.
Shri C.L. Logani ceased to be additional director with effect from 24.10.2008
consequent upon his resignations dated 13.09.2008. Shri S.K. Bansal was appointed as
nominee director of EDBI Bank with effect from 02.03.2009 in place of Shri H.D.
Maheshwari. Shri D.P. Gogia was appointed as nominee director of Bank of India with effect
from 18.07.2008 in place of Shri S.C. Arora
The profile of the directors seeking appointment / reappointment at this Annual General
Meeting is given in the Report on Corporate Governance
The Company has provided full disclosure in its audited accounts through Notes to
the Account and Accounting Policies forming part of the Balance Sheet as at 31st
March, 2009 and Profit & Loss Account for the year ended on that date in respect of
the qualifications/observations/comments made by the Auditors in their Report. Relevant
Notes in the Notes to the Accounts and Accounting Policies as referred to in the Auditors'
Report are self-explanatory and the qualifications have been suitably explained therein.
In addition to the same, the Directors would like to state that:
a) The Company has filed application under Section 297 of Companies Act, 1956 to
Central Government seeking a post facto approval in respect of the transactions entered
into with related parties.
b) The Company has prepared accounts on the going concern basis as the Company has
continued with its operations and arrangements are being made to tide over liquidity
problem. The management is hopeful to achieve better performance in the ensuring years.
Accordingly, the Company is of the view that there is no impairment of assets and had also
accounted for deferred tax assets.
c) The Company is in process of obtaining balance confirmation certificates from
various parties and also reconciling various accounts.
d) Steps have been initiated to avoid delays in payment of statutory dues.
The auditors of the company M/s Ray & Ray, Chartered Accountants, retire at the
39th Annual General Meeting of the company and have given their consent for reappointment.
The Company has also received a certificate from them under section 224 (IB) of the
Companies Act, 1956.
DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to section 217 (2AA) of the Companies Act, 1956 the Directors, confirm
1. In the preparation of the Annual Accounts, the applicable Accounting Standards have
been followed except to the extent disclosed in Significant Accounting Policies and Notes
to the Accounts (Schedule 24 & 25).
2. Appropriate accounting policies have been selected and applied consistently and
judgments and estimates that are reasonable and prudent have been made, 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/loss of the Company for that period.
3. Proper and sufficient care for the maintenance of adequate accounting record in
accordance with the provisions of the Companies Act, 1956, has been taken for safeguarding
the assets of the company and prevailing and detecting fraud and other irregularities, to
the best of our knowledge and ability.
4. The annual accounts have been prepared on a 'going concern basis.
SICK INDUSTRIAL COMPANIES (SPECIAL PROVISIONS) ACT, 1985
On 23-10-2003 the company had made an application to the BIFR under Section 15 of
SICA. The Board for Industrial Finance and Reconstruction, having been satisfied that the
company has become a sick industrial unit under the relevant provisions of SICA, declared
it to be so at its meeting held on 16-1-2006 and appointed the Industrial Development Bank
of India as the Operating Agency who earlier informed the BIFR of their inability to
prepare a Draft Rehabilitation Scheme. The BIFR during the hearing on 10.08.2009 has
directed the company to negotiate with its secured creditors and the strategic investor
and submit a fully tied up DRS, including the details and background of strategic investor
to IDBI (OA) and the Board by 31.10.2009.
There was no employee of the company drawing salary in excess of the limits
prescribed under section 217 (2 A) of the Companies Act, 1956.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUT
In accordance with the requirement of section 217(l)(e) of the Companies Act, 1956
read with the Companies (Disclosure of Particulars in the Report of Board of Directors)
Rules, 1988 a statement showing particulars in respect of above is annexed and forms part
of this report.
The Report on Corporate Governance is annexed and forms part of this report.
The Audit Committee of the Company reviewed the financial statements for the year
under review at its meeting held on 5 September, 2009 and recommended the same for the
approval of the Board of Directors.
As per the listing agreement with the stock exchange, the Management discussion
&Analysis report, Report on Corporate Governance and Auditor's Certificate regarding
compliance of all conditions of Corporate Governance form a part of this report.
Your Directors acknowledge with gratitude, the assistance and cooperation provided
by the Govt, of Rajasthan, the Company's bankers and financial institutions, suppliers,
customers and various other Government Departments.
||For and on behalf of the Board of Directors
|Date : 5th September, 2009
ANNEXURE TO THE DIRECTORS' REPORT
Conservation of energy, technology absorption, foreign exchange earnings and out go
in accordance with the Companies (Disclosure of Particulars in the report of Board of
Directors) Rules, 1988].
CONSERVATION OF ENERGY
(a) Energy conservation measures taken.
Efforts are continuously being made to conserve energy.
(b) Additional investments and proposals, under consideration for power factor
improvement and Energy conservation. Installation of additional capacitor and panel for
improvement of power factor for energy conservation as well tariff benefits/reduction in
(c) Sufficient electricity was generated on DG set by using H.S.D. which resulted in
considerable savings and helped in controlling voltage fluctuation.
(d) Impact of the measures at (a) (b) and (c) above for reduction of energy consumption
and consequent impact on the cost of production of goods. Continuous efforts are being
made for energy conservation and for reduction of power consumption per unit of
(e) Total energy consumption and energy consumption per unit of production as per
Prescribed Form "A"
(f) Research & Development (R & D)
(i) Specific areas in which R&D carried out by Company
Conceptualized the minimum number of oil fire burners in all the three pre heating
billet furnaces of extrusion press. The modification had resulted in considerable savings
in furnace oil consumption.
(ii) Benefits derived as a result of above R&D
Expansion of marketing areas particularly in the export field.
Research was carried out for new alloys and existing fluxes, filters, SCCM, less
generation of wastes.
New technical route is being developed for modifying the existing techniques for
various copper and copper alloys/sections.
(iii) Future plan of action
To improve productivity, quality vis a vis energy saving additional auxiliary
equipments are being added and modified.
(iv) R&D Expenditure
||: Rs.3.58 lacs
|c) Percentage of turnover
TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION
(i) Plantation and garden have been developed in the factory to reduce the air
pollution of foundry etc. The wastewater generated is neutralized and treated for being
reused in gardening.
(ii) New alloys viz Chromium Copper, Chromium Zirconium copper, Zirconium copper and
silicon bronze and Aluminum Bronze have been developed and also supplied to the foreign
customer and development of Nickel silver for rods and tubes are in advance stage of
development to meet the specific requirement of foreign buyers.
(iii) Developed pipe U-Bend for various sizes to be used in marine application
(iv) Bright annealing to match International Standards & Quality of product was
achieved by shifting from the Exo-gas to Nitrogen gas being generated in house.
(v) Customer care and satisfaction were further improved by adopting detailed
presentation of the product and its end use in number of countries during the year.
- In case of imported technology (imported during the last five years reckoned from the
beginning of the financial year), following information may be furnished.
FOREIGN EXCHANGE EARNINGS AND OUT GO
(a) Activities relating to exports, initiative taken to increase exports,
development of new export market for products and services and export plans
The Company is continuing to export its products.
(b) Total Foreign Exchange earned and used
||(Rs. In lacs)
||(Rs. In lacs)
|Foreign Exchange Earned
|Foreign Exchange Used
||For and on behalf of the Board of Directors
||(G. C. KANUNGA)
|Date : 5th September, 2009