THE MEMBERS OF
 
 BLUE BIRD (INDIA) LIMITED
 
 The Directors have pleasure in presenting the 12th Annual Report of
 the Company together with the Audited Statements of Account farfhe year
 ended March 31,2011.
 
 Financial results
 
 The Financial position of the Company as on the date of the Balance
 Sheet is as follows:                                 
 
                                                       (Rs. in laks) 
 Particulars                                   Year ended    Year ended
 
                                            March 31,2011 March 31.2010
 
 
 Sales & Operating Income                       1080.83      43,059.71
 
 Operating Profits (PBDIT)                     31969.14         489.13
 
 Less: Depreciation                              751.77         747.39
 
 Less: Interest                                 8816.75       7,782.12
 
 Profit / (Loss) before Tax                   {41537.66}     (8,040.38)
 
 Less: Income, Tax                                 --        (2,741.67)
 
 (Including Deferred Tax and
 Fringe Benefit Tax)   
 
 Net Profit/   for the year             (41537.66)     (5,298.71)
 
 Balance brought forward from 
 previous year                                  3226.45       8,477.89
 
 Less /Add; Prior Period Adjustments               -             47.27
 
 Distributable Profits                        (38311.21)      3,226.45
 
 
 Appropriated as under:
 
 Balance carried forward                      (38311.21)      3,226.45
 
 
 The management m order to depict the factual position of the company
 arid on the basis of the reports of the Technical and Production
 Director has reduced realizable value 6f the finished goods at 40% of
 net realizable value and raw materials, components, stores and spares
 are valued at 60 % of purchase price and based on the case to cose
 appraisal, written off debtors worth: Rs. 142.8 Crores in addition to
 the provisions as made in the previous year. Due to the above the
 accumulated loss of the company is now Rs. 38311.21 lacs resulting in
 the erosion of the entire not worth of the company of ~ Rs. 11944.8
 lacs. As per the provisions of Section 3(1) (ga) of the Sick Industrial
 Companies (Special Provisions) Act 1985 the company has to report the
 said erosion of the net worth to the authorities as stated m said act.
 The Company has proposed the resolution for the approval of the
 members, for making the reference to the Board under the provisions of
 the Sick Industrial Companies (Special Provisions) Act 1985 for the
 approval of a revival scheme of the company, under the said act. 
 
 DIVIDEND AND BOOK CLOSURE
 
 In view of the lost for the current year, the Board does not recommend
 any dividend for the year under review. The Register of members and the
 Share Transfer Books of the Company shall remain closed from Wednesday,
 September 21st, 2011 of Friday, September 30th, 2011 (both days
 inclusive) as per the requirements of Clause 16 of the Listing
 Agreements with Stock Exchanges,
 
 EXTERNAL RATINGS
 
 There are no ratings assigned as on the date of the report.
 
 MATERIAL CHANGES AND EVENTS AFTER BALANCE SHEET DATE.
 
 As mentioned in Note No. 11 of Schedule 21 (B) due to cash loss and
 delay in recovery of dues from the customers, the Company faced a cash
 crunch resulting into default in payment to lenders and other
 creditors. The Company had submitted a Corporate Debt Restructuring
 (COR) proposal to CDR Cell of Reserve Bank of India, seeking extension
 of time for repayment & seeking certain other concessions. The proposal
 was admitted by CDR cell on March 30, 2010.  The said CDR proposal was
 approved by the CDR cell of RBI as on January 28 ,2011 .The
 implementation of the CDR cell is not yet been done, pending sanction
 of few banks to be received for the said CDR proposal.
 
 As stated in Financial review, the company is now a sick company and
 its net worth has been totally eroded.
 
 BOARD OF DIRECTORS
 
 The Board of Directors at its meeting held on 30th June 2011
 recommended the reappointment of Mr. Niranjan Phadke and Mr. Satish
 Bhagwat, Directors of the Company who are liable to retire by rotation
 during the year and being eligible have offered themselves for
 reappointment. The Board seek your approval for their re-appointments.
 
 Brief particulars & expertise of the directors to be
 appointed/re-appointed and their other directorship and committee
 membership have been given in the Corporate Governance report.
 
 STATUTORY DISCLOSURES
 
 None of the Directors of the Company is disqualified to be appointed as
 Director under the provisions of Section 274(1 )(g) of the Companies
 Act, 1956. The Directors have made necessary disclosures, as required
 under various provisions of the Act and Clause 49 of the Listing
 Agreement with Stock Exchange/s.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 In terms of Section 217(2AA) of the Companies Act, 1956 in relation to
 the Financial Statements for the year ended March31,2011, the Board of
 Directors state that:
 
 a) the applicable Accounting Standards have been followed in the
 preparation of the financial statements and there are no material
 departures from the said standards;
 
 b) reasonable and prudent accounting policies have been used in
 preparation of the financial statements and that they have been
 consistently applied, so as to give true and fair view of the state of
 affairs of the Company as at March 31, 2011 and of the loss for the
 year ended on that date;
 
 c) 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.
 
 d) the financial statements have been prepared on a going concern basis
 since they are confident of successful implementation of approved CDR
 proposal and successful settlement with the parties issuing notices
 under section 433 & 434 of the Companies Act, 1956.
 
 AUDITORS
 
 M/s.Shoshank Patki & Associates, Chartered Accountants, were appointed
 as the Auditors of the Company at the previous Annual General Meeting.
 However, M/s Shashank Patki & Associates, Chartered Accountants
 resigned from the post of the Auditors as on 12th February 2011. The
 Company has now appointed M/s.Khdndelwal Gandhi & Associates as
 Chartered Accountants in the meeting of the Board, of Directors held on
 9th June 2011 -.  M/s.Khandelwal Gandhi & Associates Chartered
 Accountants retire at the ensuing Annual General Meeting and are
 eligible for re-appointment as Auditors. The Audit Committee at its
 meeting held on 9th June 2011 has recommended their re-appointment.
 
 In terms of the provisions of section 224 (1B) of the Companies Act,
 1956 M/s.Khandelwal Gandhi & Associates, Chartered Accountants have
 furnished a certificate that their appointment, if made, will he within
 the limits prescribed under section 224 (IB) of the Companies Act,
 1956.
 
 AUDITORS''REPORT (QUALIFICATIONS/COMMENTS)
 
 Management perception of Audit Qualifications.
 
 1.  Regarding verification and valuation of Inventories.
 
 The Company has incurred cash Loss during the year and is facing
 shortage of manpower in the company, as all th# qualified staff has
 left the company . The management will take the necessary steps to
 improve the internal control system / internal audit after the
 implementation of the CDR proposal.
 
 2.  Regarding Credit Assessment of Debtors and recovery of Debtors.
 
 As stated above the Company is facing acute shortage of recovery staff
 and due to the peculiar nature of note book and book publishers, the
 previous debts are recovered when new goods are supplied. Since the
 Company is not able to manufacture and supply fresh stock, debtors are
 not paying old dues. In order to arrive at correct picture the Company
 has written off Debts worth Rs, 142.89 crores in addition to the
 provisions as made in the Previous Year and have initiated legal action
 against them.
 
 3.  Regarding Reasonableness of Internal Audit System.
 
 As stated above the Company is facing shortage of qualified staff and
 after implementation of CDR, the Company will take corrective steps.
 
 4.  Regdfds to Accounts preparation on a going concern basis.
 
 The Management feels that after implementation of CDR, infusion of
 fresh capital and proposed BIFR rehabilitation scheme, the Company will
 turn round the corner and become viable once again. Therefore, as per
 the Management view the Company is still a going concern. Also the
 Company is in negotiations with creditors for extension of time and
 reduction of payables and cases filed against the Company u/s.433 and
 434 of the Companies Act 1956 will be withdrawn.
 
 5.  Writing off of Debtors.  Please refer Note. 2 above.
 
 6.  Significant Accounting Policies regarding Inventories.
 
 The Company''s Technical and Production Directors conducted physical
 stock verification and valuation of inventories in the form of Raw
 material, Components, Stores and Spares, WIP and Finished Goods.  Based
 on form, status and reliability of inventory, price of these are
 reduced a.  as regards to Raw material! by 40% > b.  as regards to
 Finished Goods by 60%
 
 PUBLIC COMMITTEE
 
 The details of the Audit Committee are given separately in the
 Corporate Governance Report.
 
 PUBLIC DEPOSITS
 
 During the year under review, the Company has not accepted any deposits
 under Section 58A of the Companies Act, 1956.
 
 EMPLOYEES STOCK OPTIONS
 
 The Company has not issued / granted any Employees stock options to its
 employees.
 
 PARTICULARS OF EMPLOYEES
 
 Since there are no employees drawing remuneration in excess of the
 limits as stated in under the provisions of Section 21 7(2A) of the
 Companies Act, 1956, no :information is given relating to the same,
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION & FOREIGN EXCHANGE
 EARNINGS & OUTGO
 
 A statement containing the necessary information required under the
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rules, 1988 is annexed to this report as Annexure I.
 
 BUY BACK OF SHARES:
 
 The Company has not done any Buy Back of Shares during the year under
 review,
 
 APPRECIATION
 
 Your Directors appreciate the trust reposed by various stakeholders of
 the Company. The Directors are also grateful and pleased to place on
 record their appreciation for the continuous and excellent support,
 guidance and cooperation extended by the Company''s Business Associates,
 Registrar & Transfer Agent, Bankers, Financial Institutions, various
 Government Regulatory Bodies, Stock Exchanges, Depositories, and
 Employees.
 
                             For & On Behalf of the Board of Directors
 
 Place:   Pune                                          Nitin Sontakke
 
 Date :   June 30, 2011                   Chairman & Managing Director