Mcleod Russel Director Discussions

For the year ended 31st March 2023

Your Directors have pleasure in presenting the Twenty-Fifth Annual Report with the Audited Financial Statements of your Company, for the financial year ended 31st March 2023.


The financials of the Company for the year ended 31st March 2023 are summarized below: ( in Lakhs)

2022-23 2021-22

Revenue from Operations

1,09,669.66 1,10,853.44

Other Income

1,366.15 554.08

Total Revenue

1,11,035.81 1,11,407.52

Profit before Finance Costs, Depreciation, Exceptional Items and Taxation

7,568.02 9,424.32

Less : Finance Costs

18,391.83 15,207.62

Less : Depreciation and Amortization Expenses

5,255.33 5,628.48

Profit/(Loss) before Exceptional Items and Tax

(16,079.14) (11,411.78)

Add/(Less) : Exceptional Items

(93,342.16) -

Profit before Tax

(1,09,421.30) (11,411.78)

Tax Expense

(4,479.03) 2,205.36

Profit/(Loss) for the year

(1,04,942.27) (13,617.14)


The operational turnover of the Company was lower at Rs. 1,09,669.66 lakhs against Rs. 1,10,853.44 lakhs in the last year, due to lower production (although selling price was higher) Loss before exceptional items was 16,079.14 lakhs against Rs. 11,411.78 lakhs for the last year. The higher loss was mainly due to lower operational turnover (as above) and also due to increase in wage rate and other inputs.

The Statement of Profit & Loss for the year 2022-23 includes charge of Rs 93,342.16 Lakhs on account of Exceptional Items being provision made in the year against Inter-Corporate Deposits and advance given in earlier years. This is part-provision, without prejudice to companys legal right to recover the amounts given by it.

The Company has not been able to meet terms of facilities/loans availed from various Lenders. The company has been in discussion with lenders for debt-resolution. Forensic audit, Techno Economic Viability Study (TEV), valuations, and credit-ratings have already been done satisfactorily. Meanwhile, lenders in addition to the above also requested for submission of the proposal for One Time Settlement (OTS proposal) of their dues. The resolution process as stated above are under active consideration of the lenders and related plans and proposals are expected to be finalised after due consideration of all the related aspects and once finalised will be placed for necessary approval for implementation. The management is confident that with the bankers support in restructuring/ settlement of their debt to a sustainable level and resultant rationalisation of cost of borrowing and other costs, induction of additional fund in the system by sale of assets or otherwise etc. and other ameliorative measures taken and/or proposed to be taken, the company will be able to generate sufficient cash-flow to meet its obligations and strengthen its financial position over a period of time.


The Authorised Share Capital of the Company is Rs. 60,00,00,000/- divided into 12,00,00,000 equity shares of Rs. 5/- each and the Issued, Subscribed and Paid up share capital of the Company is Rs. 52,22,79,000/- divided into 10,44,55,735 equity shares of Rs. 5/- each.

During the year, the Company did not issue any shares with differential rights or convertible securities. The Company does not have any scheme for the issue of shares, including sweat equity to the employees or directors of the Company. The Company does not have a scheme for the purchase of its shares by employees or by trustees for the benefit of employees. The company securities have been suspended from trading on The Calcutta Stock Exchange Limited and the Company is in process of revocation for the same.

There was no change in the capital structure of the Company during the period under review.


Subsequent to the closure of financial year, the Company at the request of Eveready Industries India Limited (EIIL), falling under Promoter and Promoter Group Category has applied for reclassification of EIIL from Promoter and Promoter Group category to Public Shareholder category with the stock exchanges. Approval is awaited from the exchanges.


The Board has decided not to transfer any amount to the General Reserve for the year ended 31st March 2023 because of loss sustained.


In view of the loss sustained by the Company during the year under review, the Board decided to not recommend any dividend for the year ended 31st March 2023.


During the Financial year under review, fluctuating and inconsistent weather conditions resulted in a loss of harvest during peak cropping months. The saleable production of your Company was 414.29 Lakh Kgs tea, as compared to 489.04 Lakh Kgs in the previous year.

Emphasis in plucking standards remained a priority and quality of leaf harvested improved considerably, resulting in a better quality of teas produced. The Uprooting and Replanting Policy of your Company continued to remain in focus and has further improved the percentage of tea under fifty years which is now over 75% of the area. "Integrated Pest Management" practice continued as per past practice and was very effective resulting in improved pest control and reduced cost. Timely supply and application of fertilizer also controlled further crop loss. A high standard of Clonal Tea nurseries with requisite, approved Clonal Blend was established on all estates. The Shade Nurseries being of a good standard contributed as one of the key factors in developing a healthy plantation. The Afforestation program continues to be enhanced along with creation of new water-bodies, to improve the "micro-climate", in select areas which has become essential to counter the effects of climate change. Plantation of Agarwood continued, for revenue enhancement, on some estates.

It has always been your Companys endeavor to produce Quality teas, which continued to command a premium, both in the domestic and international markets. Factory infrastructure and machinery was enhanced accordingly, to meet the requirements and Capital expenditure to further improve processes were accordingly sanctioned. To improve field operations and overcome the acute shortage of workers by way of absenteeism, additional investments in plucking Shears and Pruning machines were made available. Additions to the transport fleet included Tractors to aid field operations, and Ambulances to further improve the medical facilities.

The Company has thirty-one ISO 22000:2005 certified Factories which are in the process of upgradation to ISO 22000:2018. Your Company has twenty seven estates certified under "Rainforest Alliance." All our factories are certified under the "Trustea" certification and we are also in the process of assisting our suppliers of leaf from Small Tea Growers to become compliant under this certification.

Your Company also participates in the Ethical Tea Partnership forum for international buyers and producers to promote sustainable practices jointly. Due to such initiatives we have set up Community Development Forums on some of our estates, to enable welfare schemes mandated by the Government to reach our communities as well as bring about better awareness and improve the livelihood of our workers and their families.

We have also over the last few years, engaged with various organisations including UN Women, IDH, Dharmalife, GAIN, BSR, Mercy Corps, ZvdZ Foundation, ETP and ITA to build awareness and provide responsible services among all levels of our employees, particularly women. Programmes such as Preventing Violence Against Women and Girls, Womens Safety Accelerator Fund, Work and Opportunities for Women, Global Alliance for Improved Nutrition, Project Sanitation etc. now cover twenty-nine of our Estates in Assam and have proven to be most successful at building social awareness amongst women and children.

The Company performed well in the domestic and overseas markets and achieved a sales turnover of Rs 1,05,871.64 lakhs. Favorable feedback was received from all buyers both in terms of quality and deliveries. Your Company continues to be the leading producer-exporter of tea with shipments to over seventeen countries worldwide at an FOB/CIF value of Rs 28,830.35 lakhs.


During the year under review, the Company was under Corporate Insolvency Resolution Process ("CIRP") pursuant to order dated 10th February, 2023, of Honble National Company Law Tribunal, Kolkata Bench, Court II, Kolkata ("NCLT") and the Honble NCLT had appointed Mr. Ritesh Prakash Adatiya, having registration number IBBI/IPA-001/IP-P01334/2018-2019/12013), as Interim Resolution Professional (IRP) to perform the functions as mentioned under the Insolvency and Bankruptcy Code, 2016 (the Code) and the related rules and regulations issued thereunder. The powers of the Board of Directors was suspended and such powers had been vested with the IRP and had since taken control of the management of the Company.

Further, the Honble National Company Law Appellate Tribunal, New Delhi Bench, New Delhi ("NCLAT") vide its Order dated 15th May, 2023, has closed the CIRP initiated vide order dated 10th February 2023 and has set aside the said order. The suspension of the Board of Directors of the Company has been revoked and the Company has been set free of the restrictions of the CIRP and IRP has also been relieved from his functions.

Further, Aditya Birla Finance Limited, State Bank of India, Shah Brothers and IndusInd Bank Limited (not registered) have filed applications before National Company Law Tribunal (NCLT), Kolkata for initiating Corporate Insolvency Resolution Process (CIRP) under Insolvency and Bankruptcy Code, 2016 which are being contested by the Company.


In terms of requirements of Regulation 34(2)(e) of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (Listing Regulations), a Management Discussion and Analysis Report is attached as Annexure - I forming part of this Report.


In terms of requirements of Regulation 34(3) of the Listing Regulations, a Report on Corporate Governance together with the Auditors Certificate regarding Compliance of Conditions of Corporate Governance are attached as Annexure II and Annexure III respectively, forming part of this Report.


The Company has one wholly owned subsidiary namely, Borelli Tea Holdings Limited, U.K. (Borelli) and four step down Subsidiaries. Borelli is inter alia engaged in the business of investing funds in various companies engaged in tea production, blending and marketing activities. As at the end of the year on 31st March 2023 Borelli had the following Subsidiaries in different countries:-

(i) Phu Ben Tea Company Limited, Vietnam - controlling stake of Borelli being 100% (ii) McLeod Russel Uganda Limited - controlling stake of Borelli being 100% (iii) McLeod Russel Middle East DMCC, UAE - controlling stake of Borelli being 100% (iv) McLeod Russel Africa Limited, Kenya - controlling Stake of Borelli being 100%

The performances of the Subsidiaries are summarised below for your information. As required under Section 129(3) of the Companies Act, 2013 and Regulation 33 and 34(2)(b) of the Listing Regulations, Consolidated Profit & Loss Statement of the Company and its five subsidiaries and the Consolidated Balance Sheet of the Company and its five subsidiaries prepared in accordance with the Indian Accounting Standards prescribed under Section 133 of the Companies Act 2013 read with the Companies (Indian Accounting Standard) Rules 2015 as amended ("Ind AS") are appended in the Annual Report. Investments made in D1 Williamson Magor Bio Fuel Limited, an Associate Company, have been fully provided for in the Accounts of the earlier years and as such the Financial Statements of the said Company have not been considered for consolidation.

A statement containing the salient features of the financial statements of the Companys Five Subsidiaries and the Associate Company pursuant to the first proviso to sub-section (3) of Section 129 of the Companies Act, 2013 prepared in Form AOC-1 is attached to the financial statements of the Company for your information.

In terms of Regulation 34(2)(a) of the Listing Regulations, Statements on impact of Audit Qualifications as stipulated in Regulation 33(3)(d) of the Listing Regulations are appended in the Annual Report.

Although the Company does not have any material subsidiary still the Company has formulated a "Policy for determining Material Subsidiary" and the same is disclosed on the website of the Company and can be accessed at: investors/policies.aspx


Borelli Tea Holdings Limited (Borelli) has investments in its subsidiaries in Vietnam, Uganda, Dubai and Kenya. During the year under review, Borelli has a loss after tax GBP 174,64,728 as compared to last year (2021-22) loss of GBP 8,12,243.The loss was due to provision for diminution in the value of its investment in Phu Ben Tea Co Limited by GBP 17,158,826.


PBTs business is cultivation and manufacture of tea. It prepares its accounts calendar year wise. During the year 2022, the company incurred loss (both pre-tax and post-tax) of USD 2.91 million as against loss (both pre-tax and post-tax) of USD 4.51 million in year 2021. During the year 2022, PBT manufactured 0.63 million kg of tea as against 3.24 million kg in year 2021.

During the year 2022, PBT sold 3.25 million kg tea as compared to last year (2021) of 6.14 million kg. Average selling price per kg during 2022 was USD 1.08 as compared to last year ended (2021) of USD 1.19. Closing Stock of tea as at 31st December 2022 was 0.59 million kgs as compared to last year 31st December 2021 of 3.16 million kgs.

Performance of PBT has continued to deteriorate. The measures, so far taken to improve the operations, have not been successful. The Company has been engaged in monetisation of tea stocks and repayment of bank loan. The management is actively considering monetisation of the company/ assets in order to reduce liabilities / repay debt.


MRULs business is cultivation and manufacture of tea. It prepares accounts on calendar year wise. During the year 2022, MRULs total comprehensive income was USD 1.80 million as against the total comprehensive loss of USD 0.70 million in year 2021

During the year 2022, MRUL manufactured 19.65 million kgs and that was lesser by about 6% as compared to previous year i.e. 2021 of 20.97 million kgs.

The sale price during the year 2022 has increased to USD 1.32 per kg as compared to USD 1.15 per kg in previous year registering increase of USD 0.17 per kg.

However, there has been decline in tea price in 2023 due to excess tea supply in Mumbasa Tea Auction, the decline has since been arrested and is likely to improve in future. To mitigate the expected problems in tea-market, the company is trying to improve quality.


MRMEs business is blending and selling of tea. It prepares its accounts calendar year wise. During the year 2022, MRMEs total comprehensive income was USD 44,735 as compared to total comprehensive loss of USD 172,912 in year 2021.

The current year 2023 is expected to bring growth in business and profitability. Higher sales-volumes are expected from export-market as well as domestic-market.


MRALs business is trading in tea. It prepares its accounts calendar year wise. During the year 2022, MRALs total comprehensive income was USD 59,444 as compared to USD 18,902 in year 2021.

For the current year 2023, MRAL expects to expand its customer-base and thereby increase its business and profitability.


The philosophy of your Company towards fair governance going hand-in hand with social responsibilities is deeply embedded in its day to day working. The Company has, over the years, successfully formulated a methodology aimed towards improving the life of the people and the environment, which surround the units of the Company and thereby enriching the society.

In terms of Section 135(5) of the Companies Act, 2013, certain class of companies are required to spend at least 2% of Average Net Profits made during the three immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy. Although your Company did not have Average Net Profit during the above period computed in terms of Section 198 of the Act, still like earlier years, it continued with its welfare activities for development in the field of education, culture and other welfare measures to improve the general standard of living in and around the Tea Estates of the Company and other areas where it operates.

The Company has a CSR Committee and has adopted a CSR Policy which can be accessed at /policies.aspx. The Corporate Social Responsibility Committee of the Board as on 31st March, 2023 comprised of 2 Executive Directors, namely, Mr. Aditya Khaitan and Mr. Azam Monem. Mrs. Arundhuti Dhar, an Independent Director, who was the Member of the Committee ceased to be a Director with effect from 1st October 2022. As mentioned elsewhere in the report, post CIRP, the committee has been reconstituted and comprises of Mr. Aditya Khaitan, Executive Director, Mr. Sanjay Ginodia and Mrs. Rupanjana De, Independent Directors. Mr. Aditya Khaitan acts as the Chairperson of the Committee. A report on CSR is attached as Annexure VIII.


In accordance with the Regulation 43A of the Listing Regulations, the Board of Directors of the Company has adopted a Dividend Distribution Policy. These has been no change in this policy during the year under review. The Policy is also available on the website of the Company and can be accessed at the weblink


The Company has a Directors and Officers Liability Insurance Policy which protects Directors and Officers of the Company for any breach of fiduciary duty.


The Board acknowledges the responsibility for ensuring compliance with the provisions of Section 134(3)(c) read with Section 134(5) of the Companies Act, 2013 for the year ended 31st March 2023 and state that:

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed with no material departure.

(b) the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are 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 and loss of the Company for that period;

(c) the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the Directors had prepared the annual accounts on a going concern basis;

(e) the Directors, had laid down internal financial controls to be followed by the Company and that such internal financial controls were operating effectively and subject to continuous improvement.

(f) the Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.


The Board of Directors of the Company as on 31st March 2023 comprised of 7(seven) Directors of whom 4(four) were Independent Directors including one woman Director. In the opinion of the Board, all the Directors possess the requisite qualifications, experience and expertise and hold high standards of integrity.


During the period under review, Mrs. Arundhuti Dhar, Non - Executive Independent Director resigned from the Board of Directors of the Company with effect from 01st October 2022.

The Board places on record its appreciation for the valuable services and cooperation rendered by Mrs. Arundhuti Dhar during her tenure as a Director and Member/Chairperson of the Committees.

Further, the Board based on the recommendation of the Nomination and Remuneration Committee of the Company, approved the following appointments on the Board during the period under review:

(i) the Board at its meeting held on 14th November 2022 approved the appointment of Mr. Sanjay Ginodia (DIN: 07781746) as an Additional Director (Non - Executive Independent) for a period of five consecutive years commencing from 14th November 2022 to 13th November 2027 (both days inclusive).

(ii) the Board at its meeting held on 30th December 2022 approved the appointment of Mrs. Rupanjana De (DIN: 01560140) as an Additional Director (Non - Executive Independent) for a period of three consecutive years commencing from 30th December 2022 to 29th December 2025 (both days inclusive).

The above mentioned appointments have been approved by the Shareholders through Postal Ballot by way of remote e-voting on 28th January 2023 and 31st March 2023 respectively.

Further, the tenure of Mr. Aditya Khaitan as Managing Director of the Company had expired on 31st March 2023 but due to initiation of CIRP, the said reappointment could not be regularized. Subsequently, the Board at its meeting held on 17th May 2023 had approved the appointment of Mr. Aditya Khaitan as the Managing Director of the Company for a period of three years commencing from 17th May 2023 to 16th May 2026 (both days inclusive). The said appointment is subject to approval of the Shareholders and such other necessary approvals as may be required in terms of Section 196 read with Schedule V of the Companies Act, 2013.

The tenure of Mr. Azam Monem as Wholetime Director of the Company has expired on 31st March 2023 and he has expressed his unwillingness to continue in the said position on the Board of Directors of the Company and has stepped down from the position with effect from 01st April 2023.

The Board places on record its deep sense of appreciation and gratitude to Mr. Monem who has been a part of the Group for over 4 decades, for the leadership, immense invaluable contribution, guidance and cooperation rendered by him during his tenure as a Wholetime Director since 2005 and Member of the Committees that has helped the Company build and execute a resilient growth strategy.


In accordance with the provisions of the Articles of Association of the Company read with Section 152 of the Companies Act, 2013, Mr. Amritanshu Khaitan (DIN: 00213413) will retire by rotation at the forthcoming Annual General Meeting and being eligible has offered his candidature for re-appointment.

As per provisions of the Act, the Independent Directors are not liable to retire by rotation.

Brief resume, nature of expertise, disclosure of relationship between directors inter-se, details of directorships and committee membership held in other companies of Mr. Amritanshu Khaitan proposed to be re-appointed, along with his shareholding in the Company, as stipulated under Secretarial Standard-2 and Regulation 36 of the Listing Regulations, is appended as an Annexure to the Notice of the ensuing AGM.


During the year, the Company had 4 Key Managerial Personnel, being Mr. Aditya Khaitan, Chairman and Managing Director, Mr. Azam Monem, Whole time Director, Mr. Pradip Bhar, Chief Financial Officer and Mr. Alok Kumar Samant, Company Secretary.


The Independent Directors have submitted their disclosures to the Board, that they meet the criteria as stipulated in Section 149(6) of the Companies Act, 2013.

In the opinion of the Board, all Independent Directors possess requisite qualifications, experience, expertise and hold high standards of integrity required to discharge their duties with an objective independent judgment and without any external influence. List of key skills, expertise and core competencies of the Board, including the Independent Directors, forms a part of the Corporate Governance Report of this Integrated Annual Report.

In terms of Section 150 of the Companies Act, 2013 read with Rule 6 of the Companies (Appointment and Qualification of Directors) Rules, 2014, as amended, the names of all the Independent Directors of the Company have been included in the data bank maintained by the Indian Institute of Corporate Affairs.

A certificate of Non-Disqualification of Directors furnished by M/s. A.K. Labh & Co., Company Secretaries as required under Regulation 34(3) read with Schedule V Para C sub-clause 10(i) of SEBI (LODR) Regulations, 2015 is attached as Annexure IX.


The Board met six times during the year on 30th May 2022, 12th August 2022, 31st August 2022, 14th November 2022, 30th December 2022 and 19th January 2023 which was adjourned to 21st January 2023.

During the period under review, as intimated earlier, the Company was undergoing through the process of Corporate Insolvency Resolution Process during the period commencing from February - March quarter and therefore, Four (4) meetings were held on 14th February 2023, 28th February 2023, 17th March 2023 and 31st March 2023 under the Chairmanship of the Insolvency Resolution Professional with Key Managerial Personnel in lieu of Board Meeting.


The Securities and Exchange Board of India (SEBI) vide its circular No. SEBI/HO/CFD/CMD/CIR/P/2017/004 dated 5th January 2017 had issued a guidance note on Board Evaluation which inter alia contains indicative criterion for evaluation of the Board of Directors, its Committees and the individual members of the Board.

The Nomination & Remuneration Committee of the Board of Directors had laid down the criteria for evaluation of the performance of the Board as a whole, the Directors individually as well as the evaluation of the working of the Audit, Nomination & Remuneration, Stakeholders Relationship and Corporate Social Responsibility Committees of the Board. Annual Performance Evaluations as required have been carried out. The statement indicating the manner in which formal annual evaluation of the Directors (including Independent Directors), the Board and Board level Committees is given in the Corporate Governance Report, which forms a part of this Annual Report.

The Company has adopted a Familiarization Programme for Independent Directors and the same is disclosed on the website of the Company and can be accessed at http://www.mcleodrussel. com/investors/policies.aspx.


During the period under review, the Company was under Corporate Insolvency Resolution Process commencing from 10th February 2023 till 15th May 2023 and hence, no meeting of the Independent Directors as required under Schedule IV of the Companies Act, 2013, was held as the powers of the Board of Directors of the Company were suspended by virtue of the said NCLT order dated 10th February 2023.


As on 31st March, 2023, the Board has 4 statutory Committees: Audit Committee, Nomination and Remuneration Committee, Corporate Social Responsibility Committee and Stakeholders Relationship Committee. During the year, all recommendations of the Committees of the Board which were mandatorily required have been accepted by the Board. A detailed note on the composition of the Board and its Committees, meetings held during the year and its terms of reference is provided in the Corporate Governance Report forming part of this Integrated Annual Report. The composition and terms of reference of all the Committees of the Board of Directors of the Company is in line with the provisions of the Act and the Listing Regulations.


The Company has established a Vigil Mechanism/Whistle Blower Policy and oversees through the Audit Committee, the genuine concerns, if any, expressed by the employees and the Directors. The Company has also made provisions for adequate safeguards against victimization of employees, Directors or any other person who express their concerns. The Company has also provided direct access to the Chairperson of the Audit Committee on reporting issues concerning the interests of the employees and the Company. During the year under review, there has been no complaint received by the company. The Vigil Mechanism / Whistle Blower Policy of the Company has been uploaded on the website of the Company and can be accessed at


The particulars of loans, guarantee or investment made under Section 186 of the Companies Act, 2013 are furnished in the Note 50 to the Financial Statements for the year ended 31st March 2023.


The Related Party Transactions entered into by the Company during the year under review were on arms length basis in the ordinary course of business. There was no contract, arrangement or transaction with Related Parties which could be considered as material and which may have a potential conflict with the interest of the Company. Accordingly, the disclosure required u/s 134(3)(h) of the Act in Form AOC-2 is not applicable to your Company. The Company has formulated a Related Party Transaction Policy and the same is disclosed on the website of the Company and can be accessed at


In pursuance of the provisions of Section 178 of the Companies Act, 2013 and Listing Regulations, the Company has formulated a Remuneration Policy. There has been no change in this policy during the year under review and a copy of the said Policy is annexed as Annexure IV and is also available at the website of the Company at the web link

The Remuneration Policy, inter-alia, includes the appointment criterion & qualification requirements, process for appointment & removal, retirement policy and remuneration structure & components, etc. of the Directors, Key Managerial Personnel (KMP) and other senior management personnel of the Company. As per the Remuneration Policy, a person proposed to be appointed as Director, KMP or other senior management personnel should be a person of integrity with high level of ethical standards. In case of appointment as an Independent Director, the person should fulfil the criteria of independence prescribed under the Companies Act, 2013, rules framed thereunder and the Listing Regulations. The Remuneration Policy also contains provisions about the payment of fixed & variable components of remuneration to the Whole-time Director and payment of sitting fee & commission to the Non-Executive Directors.


The Company has neither accepted nor renewed any deposits during the year under review.


During the year under review, no significant or material order was passed by the regulators or courts or tribunals impacting the going concern status and the Companys operations in future except the order dated 10th February 2023 passed by Honble National Company Law Tribunal, Kolkata Bench initiating Corporate Insolvency Resolution Process against the Company as mentioned elsewhere in the report.

However, in the matter of Arbitration between Aditya Birla Finance Limited (ABFL) vs McNally Bharat Engineering Company Limited (MBECL) and others, the Sole Arbitrator, passed an Interim Order on 30th June 2020 upon the Company to perform obligations under the Put Option Agreement dated 24th March 2018. The Company had filed an application for setting aside the award which was subsequently withdrawn as the disputes between the parties was settled.

Members attention is also invited to Notes on Contingent Liabilities, in the notes forming part of the Financial Statements.


Except as disclosed elsewhere in the report, no other material changes and commitments which could affect the financial position of the Company have occurred between the end of the last financial year and the date of this Annual Report.


During the year under review, the Company has not entered into any One Time Settlement with Banks and Financial Institutions, hence, the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof is not applicable.

However, in earlier years the company had given undertakings to IL&FS Infrastructure Debt Fund (ILFS-IDF) and Aditya Birla Finance Limited (ABFL) in connection with borrowings and other facilities availed by group companies. After 31st March 2023, pursuant to the settlement agreement entered with ILFS-IDF on 05th May 2023 and ABFL on 07th June 2023, the claim made by them have been settled by another group company. The companys obligations in this respect and consequential impact, if any, in this respect have presently not been determined.

Further, during the year under review, the Company had entered into an exclusivity agreement (agreement) with Carbon Resources Private Limited to exclusively discuss, negotiate and evaluate a mutually agreeable mechanism for the Company to offer a proposed one-time settlement of the debt owed by the Company to its identified lenders , pursuant to a debt resolution process to be undertaken by the Lenders as per the Reserve Bank of Indias Prudential Framework for Resolution of Stressed Assets dated June 7, 2019. The said agreement had expired on 31st March 2023 but due to initiation of CIRP w.e.f. 10th February 2023, the same could not be renewed. Subsequent to withdrawal of CIRP w.e.f. 15th May 2023, the said agreement was further extended till 28th July 2023 by the Board of Directors of the Company and thereafter a term sheet was finally executed by the Company on 04th August 2023. The Company has given an OTS offer to the banking lenders which is under consideration.


Financial statements (i.e. Balance Sheet, Profit & Loss Statement and Cash-Flow Statement, together with notes) are prepared through the process which has automated as well as manual controls to ensure accuracy of recording all transactions which have taken place during any accounting period, and the resultant financial position at period end. All data pertaining to payroll, purchases, agricultural activities, plucking, manufacturing, dispatch, selling and other activities are recorded through ERP systems operating in tea estates as well as head office. All data/ transactions entered in systems are checked by various functional personnel on the basis of supporting documents & records, then the accounting entries are checked by accounts personnel and finally those are validated by managerial personnel.

At periodic intervals, the accounting data are compiled, and financial statements are prepared. While preparing the financial statements, it is ensured that all transactions pertaining to the accounting period are recorded. Fixed assets, stock of tea, all significant items of stores and monetary assets are physically verified. Balance confirmations are obtained for all significant items of trade receivable and advances.

After preparation of the financial statements, all items appearing in the statements are analysed in order to ensure overall reasonableness.

The Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, safeguarding of its assets, prevention and detection of fraud and errors, accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosures.


In terms of Part B of Schedule II of Listing Regulations, the CEO and the CFO of the Company certify to the Board regarding review of the financial statements, compliance with the accounting standards, maintenance of internal control systems for financial reporting and accounting policies, etc.


The Company considers its people as one of the most valuable resources and recognises that safe and healthy working environment motivate employees to be more productive and innovative. The Company takes adequate measures to keep its field and factories safe in all respects. Regular training is imparted to the employees for promoting awareness on safety and skill enhancement. The Company runs a hospital in each of its Tea Estates where the employees of the concerned Estate get regular medical attention. In addition, the Company has set up few central hospitals which are equipped with modern medical instruments. These hospitals are accessible to the employees of the surrounding areas. The Company also provides facilities for sporting and cultural activities for the employees in the Tea Estates.


The Company has undertaken an Audit of all the applicable compliances as per the SEBI Regulations and Circulars/Guidelines issued thereunder.

The Annual Secretarial Compliance Report issued by a Practising Company Secretary (PCS) has been submitted to the Stock Exchanges within the stipulated time as mentioned in SEBI Circular No. SEBI/HO/CFD/CMD1/CIR/P/2020/109 dated June 25, 2020.


The Annual Return of the Company as on March 31, 2023 pursuant to the provisions of Section 92 of the Companies Act, 2013 is available on the Companys website and can be accessed at


In terms of Section 139 of the Companies Act, 2013, M/s. Lodha & Co., Chartered Accountants (Registration firm No. 301051E) was appointed as the Statutory Auditors of the Company to hold office for a term of 5 (five) consecutive years from the conclusion of 21st Annual General Meeting till the conclusion of the 26th Annual General Meeting. M/s. Lodha & Co. has conducted audit for the Financial Year ended 31st March 2023 and furnished their report.

In their Report dated 30th May 2023, M/s. Lodha & Co. has given an adverse opinion in relation to the Standalone and Consolidated Financial Statements of the Company for the Financial Year ended 31st March 2023. The Boards response in relation to the said opinion is as under:-

Sl. No. Audit-Qualification

Boards Response

(i) Inter Corporate Deposits (ICD) with ref to Note no. 58(a) of the standalone financial statement aggregating to Rs. 2,86,115 lakhs (including interest accrued till March 31, 2019) as on March 31, 2023 given to certain companies which are doubtful of recovery and considering recoverability etc. are prejudicial to the interest of the company. Provision of Rs. 1,01,039 lakhs (including Rs. 9,097 lakhs provided in earlier years) has been made against this till March 31, 2023. In absence of provision against the remaining amount, the loss for the year is understated to that extent. Impact in this respect have not been ascertained by the management and recognised in the financial statements.

In respect of Inter-Corporate Deposits (ICDs) given to Promoter group and certain other companies (borrowing companies), the amount outstanding aggregates to Rs. 2,76,174 Lakhs as at March 31, 2023. Further, interest of Rs. 9,941 lakhs on these amounts were accrued upto March 31, 2019 and are remaining unpaid in this respect as on March 31, 2023. Interest on such ICDs considering the waiver sought by borrower companies and uncertainties involved with respect to recovery and determination of amount thereof, has not been accrued since April 01, 2019. These borrowing companies which in turn advanced the amount so taken by them to other entities including one of the promoter group company which is under Corporate Insolvency and Resolution

Process (CIRP) as per the Insolvency and Bankruptcy Code, 2016 (IBC) are in the process of recovering these amounts. The claims made by these borrowing companies pursuant to CIRP have not been fully acknowledged and amount as admitted by Resolution

(ii) Non-recognition of Interest on Inter Corporate Deposits (ICD) of Rs. 9185.03 lakhs (including Rs. 2469.03 lakhs for the year) with reference to Note No. 36.2 of the standalone financial statements taken by the company and thereby the loss for the year is understated to the extent indicated in said note and non- determination of interest and other consequential adjustments/disclosures in absence of relevant terms and conditions in respect of certain advances being so claimed by customers as stated therein. Further, as stated in Note no. 59(b), penal/compound interest and other adjustments in respect of borrowings from lenders/banks/financial institution have not been recognised and amount payable to banks and financial institutions as recognised in this respect are subject to confirmation from respective parties and consequential reconciliation. Pending final determination of amount in this respect, adjustments and impacts arising therefrom have not been ascertained and as such cannot be commented upon by us.

Professional (RP) are stated to be substantially lower than those being claimed by these companies. Whilst CIRP proceeding is yet to be concluded and amount finally recoverable pursuant to the same is yet to be determined, considering the amount so far accepted by the RP in respect of the claims made by the companies, valuation indications, eventuality of recovery in this respect and resultant net worth of these companies, provision of Rs. 1,01,039 lakhs (including Rs. 9,097 lakhs provided in earlier years) on lumpsum basis without prejudice to companys legal right to recover the amounts given by it, has been made in these financial statements.

This includes provision of Rs. 9,941 lakhs (including Rs. 7,999 lakhs provided in earlier years) provided against interest accrued upto March 31, 2019 which has been fully provided for in the financial statements.

The management believes that the outstanding dues, net of provision there against, as mentioned above, shall be recovered/adjusted and/or restructured depending upon the outcome of the recovery proceedings pursuant to CIRP or otherwise and completion of the resolution process of the company. Impacts if any in this respect will be given effect to on determination of the amount in this respect and no further provision/adjustment is required at this stage.

The Company submits that the resolution process as stated in Note no. 59(a) of the standalone financial statements are under active consideration of the lenders and related plans and proposals are expected to be finalised after due consideration of all the related aspects. The amount of interest will be determined and recognised based on the proposals once finalised to give effect to all the aspect of the proposal on comprehensive basis.

Penal interest / compound interest has not yet been confirmed by banks. Further, interest would be restructured/ finalised in accordance with the plans and proposals under consideration of the lenders and amount payable will then be ascertained and given effect to in the accounts

(iii) Non reconciliation/disclosure with ref to Note No. 60 of the standalone financial statements regarding certain debit and credit balances with individual details and confirmations etc.

Not quantified

including borrowings and interest thereupon dealt with in Note no. 59. Adjustments/ Impacts with respect to these are currently not ascertainable and as such cannot be commented upon by us.

The Company submits that it has 33 tea estates/ factories and 2 offices and therefore it is practically not feasible to reconcile the entire balances and such reconciliation is an ongoing process. Impact will thus become ascertainable only upon reconciliations and confirmations. However, during the year certain account balances which were under reconciliation have been reconciled and required adjustments thereof have been given effect to in this year.

(iv) Non-determination/recognition of amount payable with ref to Note No. 57 of the standalone financial statements in respect of claims made pursuant to shortfall undertaking executed between the company and debenture holders in respect of the debentures issued by certain group companies as dealt with in the said note and Note no. 18.2 dealing with companys obligation in respect of the settlement arrived at with a corporate lender in earlier year. Pending finalisation of terms and condition with respect to the companys obligations in respect of settlement arrived at with the parties, adjustments required in this respect are currently not ascertainable and as such cannot be commented upon by us

Not quantified The company as stated in Note no. 57 of the financial statements had given shortfall undertaking (undertaking) to IL&FS Infrastructure Debt Fund (ILFS- IDF) in connection with Debt Service Reserve Account (DSRA) obligations pertaining to the secured debentures of Rs. 15,000 lakhs and Rs. 9,950 lakhs issued respectively by Babcock Borsig Limited (BBL) and Williamson Magor & Company Limited (WMCL). The claims made by ILFS- IDF pursuant to an agreement entered with the party have been settled by Dufflaghur Investment Limited for Rs. 4,967 lakhs and CIRP proceedings as stated in Note no. 57 have since been withdrawn. The settlement obligation in this respect has been fulfilled by the said company. The companys obligations in this respect and related terms and condition thereof and consequential impact if any in this respect have presently not been determined and therefore has not been given effect to in these financial statements.

(v) As stated in Note no. 58(b) of the financial statements, the predecessor auditor pertaining to financial year ended March 31, 2019 in respect of loans included under qualification 1 above have reported that it includes amounts given to group companies whereby applicability of Section 185 of the Companies Act, 2013 could not be ascertained and commented upon by them. They were not been able to ascertain if the aforesaid promoter companies could, in substance, be deemed to be related parties to the Company in accordance with paragraph 10 of Ind AS-24 "Related Party Disclosures". Further certain ICDs as reported were in nature of book entries and/or are prejudicial to the interest of the company. Moreover, in case of advance to a body corporate as stated in Note no. 18.3 which has now been fully provided appropriate audit evidences were not made available to them. These amounts are outstanding as on this date and the status thereof have remained unchanged and uncertainty and related concerns including utilisation thereof and being prejudicial to the interest of the company are valid for periods subsequent to March 31, 2019 including current year also. The promoter companies have not been considered as related parties and therefore, transactions and outstanding from them have not been disclosed separately in the financial statements. As represented by the management, the parties involved are not related parties requiring disclosure in terms of the said accounting standard and provisions of Companies Act, 2013 and concerns expressed as above are not relevant and as such inconsequential to the Company. The matter as reported is under examination and pending before regulatory authorities. Pending final outcome of the matter under examination we are unable to ascertain the impact of non-compliances and comment on consequential impact thereof.

Finance Cost includes Rs. 2,000 lakhs being the amount paid by a third party on behalf of the company in settlement of the dues of a corporate lender in earlier year. This represents differential amount over and above the principle amount so far paid in terms of the said settlement. Pending discharge of balance obligations and finalisation of related terms and conditions, further adjustments required if any in this respect are presently not ascertainable. Could not be ascertained. The matter as reported is pending before regulatory authorities.


In terms of the requirements of Section 204 of the Companies Act, 2013, the Secretarial Audit of the Company for the year ended 31st March 2023 was conducted by Messrs. A. K. Labh & Co., Company Secretaries. The Secretarial Auditors Report is attached to this Report as Annexure V and forms part of the Directors Report.


In accordance with the requirements of Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, the Board of Directors of the Company has appointed the following firms of Cost Accountants to conduct audit of Cost Records maintained by the Company for the Tea Plantations of the Company for the year ending 31st March 2024;

(i) M/s Mani & Company (ii) M/s SPK Associates (iii) M/s DGM & Associates.

Pursuant to the provisions of Rule 14 of the Companies (Audit and Auditors) Rules, 2014, the remuneration of the Cost Auditors is required to be ratified by the Members of the Company, a resolution for which has been placed before the Members at the ensuing Annual General Meeting for their approval.

The Cost Audit Report furnished by the Cost Auditors in respect of the year ended 31st March 2023 which did not contain any qualification, reservation or adverse remark was filed with the Ministry of Corporate Affairs within the time prescribed under the Companies Act, 2013.


During the year under review, no instances of fraud has been reported to the Audit Committee under Section 143(12) of the Companies Act, 2013 against the Company by its officers or employees, the details of which would need to be mentioned in the Boards Report neither by the Statutory Auditors nor the Secretarial Auditors.


A statement giving details of conservation of energy, technology absorption and foreign exchange earnings & outgo in accordance with Section 134(3)(m) of the Act read with Rule 8(3) of the Companies (Accounts) Rules, 2014, is attached to this Report as Annexure VI.


The Company identifies various risks which the Company encounters with during the course of its business and which in the opinion of the Board may threaten the very existence of the Company itself. The Company has taken adequate measures to mitigate various risks encountered by the Company. The Company has in place a risk management policy to mitigate these actual and potential risks both at tea estates and head office. The Board is actively considering a comprehensive review of the policy for further improvement.


Your Company has adopted a Code of Conduct to regulate, monitor and report trading by insiders in compliance with the SEBI (Prohibition of Insider Trading) Regulations, 2015. All Directors, employees and other designated persons, who could have access to unpublished price sensitive information of the Company, are governed by this Code. The trading window for dealing with equity shares of the Company is duly closed during declaration of financial results and occurrence of any other material events as per the code. During the year under review there has been due compliance with the code.


The ratio of the remuneration of each Director to the median employees remuneration and other particulars or details of employees pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are attached to this Report as Annexure VII.

The Companys large work force continues to remain the backbone of its operations and their welfare has remained a prime area of focus. Upgradation of housing facilities, water supply, medical infrastructure etc. have been given priority.


Your Company has constituted an Internal Complaints Committee, under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 (POSH Act) and has a policy and framework for employees to report sexual harassment cases at workplace. The Companys process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization.

As per requirement of the POSH act, your Company follows calendar year for annual filling with statutory authority and as per the filing, there were no complaints related to sexual harassment raised in the calendar year 2022.


Your Company complies with all applicable Secretarial Standards as issued by the Institute of Company Secretaries of India (ICSI).


Pursuant to the relevant circulars issued by Ministry of Corporate Affairs, Government of India (MCA) and Securities and Exchange Board of India and as a continuing endeavour towards Go Green initiative undertaken by the MCA, the Company proposes to send all the correspondences/communications including Notice and Annual Report etc. to shareholders at their e-mail address already registered with the Depository Participants ("DPs") and Registrar and Share Transfer Agents ("RTA").

In view of the above, shareholders who have not yet registered their email addresses are requested to register the same with their DPs/ the Companys RTA for receiving all communications, including Annual Report, Notices, Circulars etc. from the Company electronically.

Your Board of Directors wish to place on record its sincere appreciation for the dedicated services rendered by the executives, staff and workers at all levels for smooth functioning of all the estates.