THE GWALIOR SUGAR COMPANY LIMITED
ANNUAL REPORT 2003-2004
The Board of Directors of your Company is submitting their 64th Annual
Report and the Audited Accounts for the year ended 31st March, 2004.
FINANCIAL RESULTS: 2003-2004
(Rs. in lacs)
Sale and other Income 1064.17
Profit before interest & depredation 270.58
From which to be deducted
Leaving a Net Profit 62.19
Your Directors regret to report that due to major repairs on the Boilers
caused a delay to start the operations and hence this led to a sharp
decrease in the availability of sugarcane due to illegal Cane diversion,
for the crushing season 2003-2004. The diversion was caused due to illegal
purchase of sugarcane by Co-operative Sugar Factory which had commenced
crushing a month earlier. The availability of sugarcane to your factory for
crushing was further effected due to Gur making and illegal Power Crushers/
Khandsad, who were operating in the command area of the factory. Even
though the Company made efforts to close these crushers, the administration
could not fully contain them.
Your Directors have to report that the cane crushing operations for the
season 2003-2004 commenced on 3rd January, 2004 and closed on 17th
March,2004. The total quantity of Sugarcane crushed during the season 2003-
2004 was 11,11,080 Qtls. in a duration of 74 days as against 8.37 Lac Qtls.
in a duration of 88 days in the previous season. The overall Recovery was
THE GWALIOR SUGAR COMPANY LIMITED
Higher at 9.36% as against 8.80% in the previous year. The cane quality
supplied to your company was of poor quality and drought affected which had
a bearing on the sugar recovery. The total Sugar Production during the
season 2003-2004 was 1,06,575 Qtls. as against 76,155 Qtls. in the last
ILLEGAL DIVERSION OF CANE
Your Directors have to report that due to non-reservation of cane area of
your factory by the State Government the sugarcane to be supplied to your
factory, was diverted to the Co-operative Sugar Factory and illegal Power
Crushers in the area. The Company had taken all the legal /administrative
steps to stop the cane diversion but due to the late start was not able to
recover the time frame and hence lost a substantial amount of cane.
However, inspite of all the above. hindrances the Company was able to crush
more than, 11 Lac Qtls. of cane in 2003-2004 crushing season.
The Statutory price of sugarcane linked to a basic recovery of 8.5% for
the Season 2003-2004 crushing season, had been notified by the Central
Govt. The M.F State has after the close of the season announced the
recommended cane prices for the, season 2003-2004. The M.P. State
Government had earlier been announcing the sugarcane prices over and above
the cane prices fixed by the Central Government without any Statutory
Authority which were been quashed by the M.P. High Court. Furthermore
during the last two years the State Government did not reserve the cane
area for the factory and also there was no Bonding (Contract) with the
farmer, nor is there any system of Cooperative Society for purchase of
Cane, and hence the Company was thus paying an fair open market price after
negotiating this with the farmers directly.
Your Company was paying sugar cane prices at fair levels which had been
acceptable to the cane cultivators supplying sugarcane to the factory.
Although the Central Govt. had continued with the dual policy of partial
decontrol of sugar for the season 20032004 and maintained the ratio to
10:90 for Levy and Free sale sugar respectively.
The Free sale sugar market showed an upward trend due to an All India
decline in the annual production. The overall sugar production of the
Country for the season 2003-2004 had been estimated downwards at 135 Lac
M.T as compared to last seasons 200 Lac M.T Hence the reduction of the
large carry forward stocks and with a steady increase in the consumption
drove the Sugar Prices upwards.
The Central Govt. had notified the Levy Price for the season 2003-2004. The
Levy Price was Rs.1423.97 which was much higher than the open market price
prevailing on Free Sale Sugar upto March,2004. Due to this factor the quota
of Levy Sugar was not lifted by the State Govt. Authorities. However due to
market improvement in the prices subsequently improved both lifting and
Molasses production was also affected due to lack of cane crushed. However
your Company was able to obtain substantially better and higher rates than
other States due to shortage of Molasses.
MODERNISATION AND EXPANSION PROGRAMME
Your Directors have to report that Modernisation and Expansion Programme,
under-taken to achieve a crushing capacity of 2500 TCD could not be fully
completed due to lower availability of cane and other financial
However, the Directors are to glad to report that the Sugar Technology
Mission(STM) had adopted your factory in the list of Units to be included
for Technology up-gradation and increasing the capacity of your Plant to
2500 TCD, together with setting up a 45,000 LPD Ethanol Plant together with
The STM had sent their technical experts to visit the factory and to draw
up a comprehensive scheme. The scheme is being finalised shortly and will
be financially appraised by a Financial Institution and thereafter put up
for funding to the Sugar Development Fund. The Company intents to fully
implement this plan within the next two years.
The Company has further taken up a comprehensive Cane Development Scheme
for increasing the Cane Command Area due to the commencement of the Rajghat
Canal System which will bring a large portion of agriculture land under
assured irrigation in your company's cane command Area. This additional
area would ensure adequate future cane supplies on the expanded capacity.
The Company proposes to provide agricultural inputs to the new prospective
cane farmers and will be increasing its existing cane command area.
Your Company has taken a plan to set up an Ethanol Plant of 45,000 KLPD
and. also a Co-generation Plant of 12 MW which would be attached with the
expanded Plant. Such diversification is essential to give a composite
growth to the company in the future, and for better utilisation of its
valuable by products.
PROSPECTS FOR THE NEXT SEASON
Your Directors are glad to report that there had been a perceptible
increase in the cane area on account of highly remunerative cane prices
being paid by the Company. The Company is also providing financial
assistance to the cane growers of the area i.e. by providing agricultural
inputs, seeds, fertilizers and plant protections etc. in order to promote
the planting of early maturing varieties of sugarcane, and helping the
farmer to adopt better agricultural practices for optimizations of its
Your Directors regret to report that the farming operations of the Company
suffered a set-back due to ever increasing menance of encroachments by
Adivasis and Tribal People instigated by anti-social elements and
politically motivated persons. The Company had been taking all possible
legal action to 'protect its rights and property but not effective
deterrent measures had been taken by the authorities. The Company had also
been approaching the higher authorities for directions to the concerned
local authorities but no favourable response had been taken by them.
However, the Company is making every efforts to regain control of as much
area as possible.
The Agro Forestry programme received a sharp setback due to large scale
depredations by Adivasis and their instigators. All possible measures are
being taken to control the problems but due to lack of effective support of
the Administration the Company could not able to obtain any effective
Your Directors regret to report that the farming operations of subsidiary
company had been adversely affected due to large scale encroachments and
depredations on the farm lands of the company. In the financial year 2003-
2004, the farms of your subsidiary company have shown losses. However, it
is expected that after effective control on the menance of encroachments,
the farming operations of the subsidiary company may be expected to
LAND TRADING / REAL ESTATE
Your Directors have to report that the Company proposed to start a
Employees Group Housing Scheme for giving housing facilities to its
employees on its surplus urban land. The Master Plan was in process of
finalizing and thereafter the said land would be transferred to- the
Employees Co-operative Housing Society The Company would benefit as it
would be able to obtain the cost of the Land. The Company was planning to
enter into a collaboration with a reputed builders who would build/ develop
such homes or, behalf of the Company. The Company in the next phase also
proposes to give the above facilities to its cane growers against their
Your Directors are glad to report that Industrial relations had been
cordial and satisfactory during the year under review.
Mr. Madhava Prasad and Mr. K.L. Pasricha, retire from the Board of
Directors by rotation but being eligible offer themselves for re-
DIRECTOR'S RESPONSIBILITY STATEMENT
Pursuant to provisions of Section 217(2AA) of the Companies Act,1956, your
Directors hereunder state that:
(i) In the preparation of the Annual Accounts for the year ended 31st
March,2004, the application accounting standards have been followed along
with proper, explanation statement relating to material departures.
(ii) The Directors have selected such accounting policies and applied them
consistently and made judgements 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 on 31st March,2004 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.
(iv) The Annual Accounts for the year ended 31st March,2004, have been
prepared on a going concern basis.
The Company has appointed M/s V Bapna & Company, Chartered Accountants,
Gwalior, for carrying out the Tax Audit for the Financial Year ended 31st
March, 2004. The Audit Report of the Auditors has been filed with the
In compliance of section 233-B of the Companies Act,1956, the Company has
appointed Mr. P.K.Varma, as Cost Auditor with the approval of the Central
Govt for the Financial Year 2003-2004. The Audit Report of the Auditors for
the year ended 31st March, 2004 has been filed with the Authorities.
Compliance Certificate given by M/s Adesh Tandon & Associates, Company
Secretaries, Kanpur, for the year 2003-2004, is attached with the Directors
M/s Vidyarthi & Sons, Chartered Accountants, Gwalior, Statutory Auditors of
the Company retire and are eligible for re-appoinunent for the Financial
M/s Adesh Tandon &-Associates, Company Secretaries, are eligible for
reappointment for the Financial Year 2004-2005 to issue the Compliance
Certificate for the above Financial Year.
The Company has not accepted fixed deposit during the Financial Year ended
31st March, 2004.
COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS)
The Particulars required to be given in accordance with Companies
(Disclosure of Particulars in the report of Board of Directors) Rules, 1988
viz. Conservation of Energy, Technology, Absorption etc. are given in
Annexure `A' attached.
PARTICULARS OF EMPLOYEES
No Employee of the Company in the Financial year ended 31st March,2004
received in aggregate a remuneration of Rs.1,00,000/- (One Lac) or more per
VIKRAM K. SRIVASTAVA
For and on the Authority of
Bated: 2nd December, 2004 the Board of Directors.
TO THE DIRECTORS' REPORT
(A) Conservation of Energy
a) Energy Conservation measures taken
Vapour Bleeding arrangement from quintuple III body for raw Juice heating
is being made.
b) Additional Investments and proposals, if any, being implemented for
reduction of consumption of energy
i) V M.F -600 Verticle Injection Pump is being installed, it will save 100
H.P at Injection Station. Estimated Cost is Rs.18.00 Lacs.
ii) Replacement of obsolete design A-Centrifugals by most modern fully
automatic self discharge machines. It's estimated cost is Rs.85.00 Lacs. It
will save 300 H. P. Power.
c) Impact of the measures at (a) and (b) above for reduction of energy
consumption and consequent impact on the cost of production of goods
i) Direct saving of Rs.30.00 Lacs/ season will be achieved by saving
ii) Savings of Rs.20.00 Lacs / season due to good quality of sugar
d) Total energy consumption and energy consumption per unit of production,
as per form 'A' if the Annexure in respect of Industries specified in the
(B) Technology Absorption
e) Efforts made in technology absorption as per Form-B of the Annexure ;
(C) Foreign Exchange Earnings and Outgo
f) Activities relating to exports, initiative taken to increase exports,
development of new export markets for products and services, and export
plans: No export.
g) Total Foreign exchange used and earned: Nil
FORM - `A'
Disclosure of Particulars with respect of Conservation of Energy
Current Year Prev. Year
(A) POWER AND FUEL CONSUMPTION :
(a) Purchased :
Units (K.W.H.) 7,81,860 8,02,698
Total Amount (Rs.) 47,73,640 55,31,644
Rate/Unit (Rs.) 6.10 6.89
(b) Own Generation
(i) Through Diesel Generator
Units (K.W.H.) 57,600 85,320
Unit per Litre of "Diesel Oil 2.32 2.32
Cost/Unit (Rs.) 10.10 9.25
(ii) Through Steam Turbine/
Units (K.W.H.) 23,80,800 18,16,900
Unit per Qtl. of Bagasse(K.W.H.) 7.10 7.04
Cost/Unit (Rs.) 7.69 5.50
2. Coal (Specify quantity and
Quantity (Tonnes) N.A. N.A.
Total Cost (Rs.) N.A. N.A.
Average Rate (Rs.) N.A. N.A.
3. Furnace Oil
Quantity (Ltrs.) N.A. N.A.
Total Amount (Rs.) N.A. N.A.
Average Rate (Rs.) N.A. N.A.
Quantity (Qtls.) 5,562 10,621
Rate (Rs.) 118 125
Amount (Rs.) 6,56,641 13,27,625
5. H.S.D. Oil :
Quantity (Ltrs.) 35,450 36,854
Rate (Rs.) 24.00 21.42
Amount (Rs.) 8,50,800 7,89,413
6. Other/Internal Generation
steam used for driving prime
movers and used are
Quantity (Qtls.) 3,50,113.50 2,47,751
Rate (Rs.) 54.60 35
Amount (Rs.) 1,91,16,197 86,71,285
(B) Consumption per
Packed Sugar (Qtls.) 1,06,575 76,155
Firewood (Qtls.) 0.052 0.14
Bagasse (Qtls.) 3.29 3.25
H.S.D. Oil (Ltrs.) 0.33 0.48
Electricity (K.W.H.) 30.21 35.52
REASONS FOR VARIATION
Variation in consumption per unit production is mainly higher Cane crush
and Sugar Production.
FORM - "B"
Disclosure of particulars with respect to Absorption, Research and
1. Specific areas in which R & D carried out by the Company
Research and Development activities stared in the areas of raising seed
nurseries, improving cultivation practices, Management of Fertilizers,
improvement in the yield of rotation and plant crop through demonstration
and evaluation of new promising early and mid late varieties are being
followed up vigorously.
2. Benefits derived as a Result of above R & D
As a result of Research and Development these had been improvement in-Plant
and-Ratoon-yield and better control of pests and availability of healthy
disease free seed. Early and Mid-maturing varieties have shown satisfactory
3. Future Plan of action
A programme is being drawn up to make available healthy seeds of new early
maturing varieties to the sugarcane growers, educating farmers and
extension workers for adopting new improved cultivation practice and
techniques, Nutrient Management, Bio-fertilizers and integrated control by
Plant Protection measures.
4. Expenditure on Research & Development (Proposed) :
A. Capital (Subsidised S.D.F.) : -
B. Recurring Rs.3,70,406.00
C. Total Rs.3,70,406.00
D. Total R & D expenditure as a
Percentage of total turnover : 0.36
TECHNOLOGY ABSORPTION, ADOPTION OF INNOVATION
1. Efforts, in brief, made towards technology Absorption, Adoptation and
The Company has made served efforts for technology absorption, adoption and
innovation like demonstration Plots and holding meetings in villages to
adopt latest technology for better production and quality product.
2. Benefits derived as a result of above efforts e.g. Product improvement
cost reduction, product development import substitution etc.
There had been a reduction in the cost of cultivation and improvement in
the product and quality thereof.
3. In case of imported technology (imported during the last 5 years
reckoned from the beginning of the Financial Year) following information
a) Technology Imported N.A.
b) Year of Import N.A.
c) Has Technology been
fully absorbed N.A.
d) If not fully absorbed,
areas where this has not
taken place, reasons
therefore - and future
plan of action. N.A.
THE GWALIOR SUGAR COMPANY LTD.
DABRA, DISTT. GWALIOR,
We have examined the registers, records, books and papers of M/s. GWALIOR
SUGAR COMPANY LTD., as required to be maintained under the Companies Act,
(the Act) and the rules made there under and also the provisions contained
in the Memorandum and Articles of Association of the company for the
Financial year ended on 31st March, 2004. In our opinion and to the best of
our information and according to the examinations carried out by us_ and
explanations furnished to us by the company, its officers and agents, we
certify that in respect of the aforesaid financial year.
1. The Company has kept and maintained all registers as stated in Annexure
'A' to this certificate, as per the provisions and the rules made
thereunder and all entries therein have been duly recorded.
2. The Company has duly filed the Forms and returns as stated in
Annexure'B' to this certificate with the Registrar of Companies, Regional
Director, Central Government, Company Law Board or other authorities within
the time prescribed under the Act and the rules made there under.
3. The Company being a public limited Company has the minimum prescribed
paid up capital.
4. The Board of Directors duly met 4 times respectively on
30.6.2003, 27.9.2003, 29.11.2003 and 27.3.2004 in respect of which
meetings, proper notices were given and the proceedings were properly
recorded and signed including the circular resolutions passed in the Minute
Book maintained for the purpose.
5. The Company has closed its Register of members from 21st December,2003
to 30th December,2003 both days inclusive and necessary compliance of
Section 154 of the Act has been made.
6. The Annual General Meeting for the financial year ended on 31st
March,2003 was held on 30th Dec.2003 after giving due notice to the members
of the company and the resolutions passed thereat were duly recorded in the
Minute Book maintained for the purpose.
7. No Extra Ordinary General Meetings) was held during the financial year.
8. The Company has not advanced any loan to its director/ firm/ person/
company referred u/s 295 of the Act.
9. The Company has not entered into any contracts falling within the
purview of section 297 of the Act.
10. The Company has made necessary entries in the register maintained under
section 301 of the Act,
11. As there were no instances falling within the purview of section 314 of
the Act, hence the Company has not obtained any approvals from the Board of
Directors, Member or Central Government, as the case may be.
12. The Company has not issued any duplicate certificates during the
13. The Company
(i) Delivered all the certificates on lodgment thereof for transfer in
accordance with the provisions of the Act. As there was no case of issue of
securities and transmission during the financial year.
(ii) Not deposited any amount in a separate Bank Account as no dividend was
declared during the Financial Year.
(iii) The Company was not required to post warrants to any members of the
company as no dividend was declared during the financial year.
(iv) No unpaid dividend, nor any application money due to for refund is
lying, and it has no deposit and interest accrued thereon, hence same is
not applicable. However dividend proposed for the financial year 1995 and
liability in respect of dividend of Preference Shares for the period 1991
to 1995 has been written back as financial Institution did not grant their
(v) Duly complied with the requirements of Section 217 of the Act.
14. The Board of Directors of the Company is duly constituted. There, was
no appointment of additional directors, alternate directors and directors
to fill casual vacancies during the financial year.
15. The Company has not appointed any Managing Director /Whole-time
Director/Manager during the financial year.
16. The Company has not appointed any sole selling agents during the
17. The Company has obtained due approval of the Registrar of Companies to
hold Annual General Meeting for the Financial Year ended on 31st March,2004
upto 31st December,2004. However the Company was not required to obtain the
approval of the Central Govt., Company Law Board and such other authorities
prescribed under the various Provisions of the Act except the Preference
Share which have not been redeemed.
18. The Directors have disclosed their interest in other firms/companies to
the Board of Directors pursuant to the provisions of the Act and the rules
19. The Company has not issued any shares, debentures or other securities
during the financial year.
20. The Company has not bought back any shares during the financial year
ending 31st March, 2004.
21. The Preference Shares have not been redeemed which were due for
redemption in earlier years.
22. There were no transactions necessitating the Company to keep in
abeyance the right to dividends, rights, shares and bonus shares, pending
registration of transfer of share.
23. The Company has not invited/accepted any deposits including any
unsecured loans falling within the purview of Section 58 A during the
24. The amount borrowed by the Company from directors , members / financial
institutions, banks and others during the financial year are within the
borrowing limits of the company and the necessary resolution as per section
293(1)(4) of the Act has been passed in duly convened Annual General
Meeting / Extra Ordinary General Meeting.
25. The Company has not made any loans / investments or advances, or given
guarantees or provided securities to other bodies corporate during the
26. The company has not altered the provisions of the Memorandum with
respect to situation of the Company's registered office from one state to
another during the year under scrutiny.
27. The Company has not altered the provisions of the Memorandum with
respect to the objects of the Company during the year under scrutiny.
28. The Company has not altered the provisions of the Memorandum with
respect to name of the Company during the year under scrutiny.
29. The Company has not altered the provisions of the Memorandum with
respect to Share Capital of the company during the year under scrutiny.
30. The Company has not altered its Articles of Association during the
31. There was no prosecution initiated against or show cause notices
received by the company and no fines or penalties or any other punishment
was imposed on the company during the financial year for offences under the
32. The company has not received any money as security from its employees
during the financial year.
33. According to the records of the company Provident Fund dues have not
been regularly deposited with the appropriate authority and Trust. The
Companies is in default towards non payment of Provident Fund dues.
ADESH TANDON & ASSOCIATES
C.P. No. 1121.
Place : Kanpur
Date : 2nd December, 2004.
ANNEXURE - A
REGISTERS AS MAINTAINED BY THE COMPANY
1. Register of Members u/s 150
2. Registers and Returns u/s 163
3. Minutes Book of meetings u/s 193
4. Books of Accounts u/s 209
5. Registers u/s 301
6. Register of Director. Managing Director, Manager and Secretary u/s 303
7. Register of Director Shareholding u/s 307
8. Registers of Charges u/s 143
1. Register of Transfer
2. Register of Directors Attendance
3. Register of Shareholders Attendance
4. Register of Share Applications and Allotment
5. Register of Share Script
6. Register of Fixed Assets
7. Register of Common Seal
The other Statutory Registers are not required to be maintained as same are
not applicable, as there exist no transactions to be recorded there
1) Forms and Returns as filed by the Company with Registrar of Companies
during the financial year ended on 31st March, 2004.
Sl. No. Foms/Return Filed For Dated A B
1. Balance Sheet 220 31.03.2003 05.01.2001 Yes NA
2 Assest Return 159 30.12.2003 25.02.2004 Yes NA
3. Form No.23 192 30.12.2003 12.01.2004 Yes NA
4. Form No.8 125/127 15.12.2003 12.01.2004 Yes NA
5. Form No.13 125/121 15.12.2003 12.01.2004 Yes NA
A = Whether filed within prescribed time Yes/No
B = If delay in filing whether requisite additional fee paid yes/no