Dr. M. SOY AND GENERAL FOOD LIMITED
TO THE MEMBERS OF
Dr. M. SOY AND GENERAL FOOD LIMITED
Your Directors have great pleasure in presenting Twelfth Annual Report
together with the Audited Statement of Accounts of the
The year has been a combination of achievements and disappointments. The
Company was able to produce and sell more of its products in a very
competitive market. The Company was able to improve its operating
performance, reduce costs and achieve higher quality standards. However,
there was considerable reduction in operating margins due to stagnant
selling price of edible oils for the most of year. There was also burden of
interest on high cost loan funds, which attributed to further reduction in
cash profits There was also increase in provisions for depreciation due to
The most disappointed thing which took place in the factory premises on the
20th day of March, 1998, is an act of sabotage resulting in Leakage of 396
M.T. of Edible Oil and thereby inflicting a burden of loss to the tune of
Rs.1.36 Crores on the Company. The motive behind such malicious act could
not ascertained. However, the said loss is covered under insurance policy
taken by the Company and a claim has been made for the same. The Company is
pursuing the case with the lnsurance Company for early settlement of the
The Company also incurred a further loss of Rs.2.00 Crores (approx.)
because of Fungus infection to Raw Materials i.e. Mustard seed. The said
loss occurred due to erratic weather conditions and untimely rain. The
resultant oil that was produced involving the fungus infected seeds was
found to be Non-Edible Quality. Even the resultant by product (cattle feed)
was of lower quality fetching a lower realisation. This affected the
production cycle and consequently the performance of the Company adversely.
Due to such abnormal losses, which resulted in lack of working capital, the
production process of the Company is presently closed. The Bank of India &
IDBI was fully appraised about such losses. Further to the discussions we
have had with Bank Officials, the Company approached the Bank of India with
a Rehabilitation proposal of additional finance along with other
concessions, so that production process could start. A copy of the proposal
is also submitted with IDBI. The Bank is agreeing in principle to assist
the Company. Presently the Bank is appraising our proposal sympathetically.
The Company is hopeful of positive outcome of the same in very near future.
The accumulated losses of the Company, as at the end of the financial year
under consideration, have resulted in erosion of more than 50% of its peak
Net Worth during the immediately proceeding four financial years, the
Company shall, within a period of 60 days from the date of finalisation of
the duty Audited Accounts of the Company for the relevant financial year--
i) report the fact of such erosion to BIFR.
ii) hold a General Meeting of Share Holders of the Company for considering
Dividend has not been proposed by the Directors in view of the losses for
the year under report.
During the year under review, Mr. Vijay Kumar Gupta was inducted to the
Board of Directors of the Company as an Additional Director on 25.03.98 at
the meeting of the Board.
Mr. Vijay Kumar Gupta, ceases to be Directors of the Company at the
commencement of the ensuing Annual General Meeting. Due to his pre-
occupation, he showed his inability to continue as Director in the Board of
the Company. Considering his request, the Board decided not to recommend
his appointment as Director under Section 257 of the Companies Act,1956.
The Directors placed on record their appreciation and thanks for the
valuable contributions made by Mr. Vijay Kumar Gupta during his association
with the Company.
In terms of provisions of Companies Act,1956, and Article 100 of the
Articles of Association of your Company,Mr. S.I. Abidi and Ms. Anuradha
Jain, retire by rotation at the ensuing Annual General Meeting and being
eligible, offer themselves for re-appointment.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
Pursuant to Section 217 (i) (e) of the Companies Act,1956, read with the
Companies (Disclosures of Particulars in the Report of the Board of
Directors) Rules,1988, a separate annexure to this report is attached
The Company has not accepted any fixed deposits from the public.
M/s. Jai Umesh Associates, Chartered Accountants, statutory Auditors of the
Company hold office until the conclusion of the ensuing Annual General
Meeting and are recommended for re-appointment. The Company has received a
certificate from them to the effect that their re-appointment, if made,
would be within the prescribed limits under Section 224 (1 B) of the
The Notes on the Accounts referred to in the Auditors' Report are self-
explanatory and therefore do not call for any further explanation.
PARTICULARS OF EMPLOYEES
As required by the provisions of Section 217 (2A) read with the Companies
(Particulars of Employees) Rules, 1975, as amended, we report that there
was no employee, whether on part time or full time basis, who received
remuneration exceeding the limit prescribed under the said Section of the
The labour management relations during the year under review, remained
The Directors wish to place on record their appreciation for the assistant
and co-operation received from the IDBI, Company's Bankers, concerned
Government Departments for the year under review. The Directors also wish
to place on record their deep appreciation for the valuable services
rendered by the officers, staff and workers of the Company at all levels.
or & on behalf of the Board
for Dr. M. Soy and General Food Ltd.
Place : New Delhi PREM PRAKASH GUPTA
Date : 28th November, 1998 Chairman & Managing Director
ANNEXURE TO THE DIRECTORS' REPORT FOR THE YEAR ENDED 30.06.1998
ADDITIONAL INFORMATION AS REQUIRED UNDER SECTION 217 (I) (E) OF THE
COMPANIES ACT,1956 AND THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE
REPORT OF BOARD OF DIRECTORS) RULES,1988
A. CONSERVATION OF ENERGY
Conservation of energy continues to remain an area of high attention of the
Management. Serious efforts have been made to conserve energy be it power
generation fuel, electric power and steam. In order to attain to this
objective, apart from installation of energy efficient boilers, condensate
recovery systems, Flash Steam systems, Modular capacitor banks in the
electric circuit, day to day monitoring is conducted to ensure
effectiveness of all these systems.
B. TECHNOLOGY ABSORPTION
The process adopted for both Solvent Extraction and refinery are based on
latest proven know-how and the Companies able to produce premium quality at
optimum recovery and chemicals and utilities consumption levels.
C. FOREIGN EXCHANGE EARNINGS AND OUTGOINGS
The Company has not made any expense in Foreign Exchange. Similarly, no
income in Foreign Exchange has been received during the financial year.