Stanrose Mafatlal Lubechem Ltd Directors Report

STANROSE MAFATLAL LUBECHEM LIMITED ANNUAL REPORT 2005-2006 DIRECTORS REPORT To, The Members, STANROSE MAFATLAL LUBECHEM LIMITED Your Directors hereby present their Eleventh Report together with the Audited Statement of Accounts of the Company for the financial year ended 31st March, 2006. FINANCIAL RESULTS: (in Rupees) Current Previous Year Year Total Income 32,00,028 53,66,245 (Loss) before interest & depreciation (9,22,280) (3,82,267) Interest 87,070 3,64,054 Depreciation (12,76,306) (7,68,564) Profit / (Loss) for the year (7,68,564) 8,27,038 PERFORMANCE OF THE COMPANY: As reported last year the Company is already out of lubricant business. During the year under report, it has undertaken a little trading in textile goods, the turnover of which is about Rs.6,51,533/-. The remaining income is mainly generated from the financial assets in the nature of profit on sale of shares, dividend and interest aggregating to about Rs.25,47,955/- On the other hand the expenses for employees for the year have considerably reduced to Rs. 2,24,324/- from Rs. 3,45,268/- in the previous year. During the year under report, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside the demands of Excise Authorities on Companys blenders which were not acknowledged by the Company amounting to Rs. 251.16 Lacs. DIVIDEND: In view of the losses, your Directors do not recommend any dividend for the year under review. LISTING: The Companys equity shares are listed on the Mumbai Stock Exchange vide code No.520149 and Ahmedabad Stock Exchange vide code no.38014. The securities are admitted in CDSL vide ISIN No.INE521D01011 (Currently suspended). The Company had applied to the Mumbai Stock Exchange for in- principle approval for listing of its restructured / reorganized equity share capital, but no such approval was given since the public shareholding in the Company has gone below 10%. Hence the Companys securities are suspended from trading on the Mumbai Stock Exchange and deactivated for dematerialisation in CDSL. In respect of the equity shares held in electronic form, the depository is yet to effect the corporate action pertaining to new equity shares of the face value of Rs. 5/- each, since no in principle approval has been granted nor any other proper response given by the Mumbai Stock Exchange to the Company or CDSL, which is a pre-requisite for CDSL to give effect to the necessary corporate action. Our consistent efforts with BSE could not yield any result and the above matters still remained unresolved by them. The Company has appointed M/s. MCS Limited as its common agent for handling R & T Work including physical as well as denial related activities (as and when approved by CDSL) with effect from 1st January 2005. Any query related to the equity shares of the Company may be addressed to our Registers and Shares Transfers Agents, MCS Ltd., Unit: Stanrose Mafaltal Lubechem Limited, Harmony, Plot No 6, Sector 1, Khanda Colony, New Panvel (West). CORPORATE GOVERNANCE The Company is following good corporate practices and complying with all the Statutory and Regulatory provisions applicable to it. However, now since the Paid-up Capital of the Company stands reduced below Rupees Three Crores, a detailed report on Corporate Governance as provided under Clause no 19 of the Listing Agreement with the Stock Exchanges, is not required to be published. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to the requirement under Section 217 (2AA) of the Companies Act, 1956, with respect to Directors Responsibility Statement, it is hereby confirmed : 1. That in the preparation of the annual accounts for the financial year ended 31st March 2006, the applicable accounting standards have been followed along with proper explanation relating to material departures; 2. That the Directors have selected such accounting policies and applied them consistently and made judgements and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year ended 31st March 2006 and of the profit or loss of the Company for the year under review ; 3. That 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; 4. That the Directors have prepared the accounts for the financial year ended 31st March 2006 on a going concern basis. DIRECTORATE In accordance with the provisions of Section 256 of the Companies Act 1956, Mr. S. B. Shah, Director of the Company, is due to retire by rotation at the ensuing Eleventh Annual General Meeting of the Company and is eligible for re-appointment. None of the Directors of the Company is disqualified from being appointed as Director as specified in Section 274 of the Companies Act, 1956. FIXED DEPOSITS Your Company has not accepted any fixed deposits during the year under review. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO Since, the Company has exited the lubricants business, there is no particulars to disclose under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, as regards conservation of energy or technology absorption. Further. during the year under review, there was no earning or payment made in foreign exchange. PARTICULARS OF EMPLOYEES The Company has not paid any remuneration attracting the provisions of Companies (Particulars of Employees) Rules, 1975 read with Section 217 (2A) of the Companies Act, 1956 as amended to date. Hence, no information has been included in this regard in this Report. AUDITORS AND AUDITORS REPORT You are requested to appoint Auditors for the current year to hold office from the conclusion of the ensuing Annual General Meeting until the conclusion of the next Annual General Meeting and to fix their remuneration. The Directors have taken a note of the observations made by the Auditors in their Report. The concerned notes on accounts referred to in these observations are self-explanatory. ACKNOWLEDGEMENTS Your Directors would like to express their grateful appreciation for the assistance and co-operation received from bankers, government authorities. shareholders and employees. On behalf of the Board of Directors BHARAT N. DAVE Chairman Place : Mumbai Dated : 26th June, 2006