Your Directors present the 112th Annual Report and the Audited Accounts
of the Company for the year ended 31st March 2004.
1. FINANCIAL RESULTS
PROFIT FOR THE YEAR 4,24,15,603
before charging interest and depreciation
Less : Interest 2,34,72,847
Depreciation 1,72,22,765 4,06,95,612
Less : Balance of Loss Brought Forward 14,72,49,436
LOSS CARRIED FORWARD 14,55,29,445
In absence of profit, we regret our inability to recommend Dividend on
Equity Shares of the Company.
TEXTILE - (AKBARPUR UNIT, PUNJAB)
Your Directors are pleased to inform that NISM, Akbarpur has shown
better result except during the first quarter because of countrywide
strike by the weavers and knitters to protest against the introduction
of CENVAT by the Govt. during the last budget of 2003. However, after
some amendment made by the Central Govt. in CENVAT, the activities in
the market become normal and production again resumed to its usual
Some balancing machines and equipments were commissioned for
manufacturing value added items to improve its working. New energy
saving equipments were also installed which resulted in the reduction
of power cost.
Under WTO agreement, quota restrictions will be abolished from 1st
January, 2005. This will help Indian Textile Industries to grow
further. Your Directors look forward for better results during the
The working of this division was satisfactory. Due to recession in the
Engineering Industry this division could not procure adequate orders
till the second quarter of the year. The unprecedented increase in the
Steel price also affected the margins of the Division. Since then your
Company has received substantial orders from TISCO and other firms. The
current order position is satisfactory and the future for procuring
further orders looks quite bright. Your directors are hopeful of better
results in future.
The cost of Power purchased from SEB went up during the year and the
position in this regard is not expected to improve in the foreseeable
future. Accordingly, your Directors have decided to install Captive
Power Plant, which would improve our economy and enhance the life of
Value addition in our finished products has become essential, as it
would add to our profitability. Hence, it has been decided to install a
dyeing plant alongwith some balancing machines.
In this regard a scheme has been submitted to State Bank of India with
an aggregate amount of Rs. 15.44 Crores for availing term loan under
Govt. of India Textile Upgradation fund Scheme. After the
implementation of the scheme, your companys bottom line will improve
4. AUDITORS OBSERVATION
The Auditors observation on Note 11 of Schedule 16 to the accounts is
5. FIXED DEPOSITS
Deposits aggregating to Rs. 1,30,000 falling due for the payment to
6(Six) depositors remained unclaimed as on 31st March, 2004 have since
been paid to such depositors.
In compliance with the provisions of section 205C(2) of the Companies,
Act 1956 the Company has deposited a sum of Rs. 1,93,123 in respect of
Unclaimed Dividend, Unclaimed Deposits and Interest accrued thereon
remaining unclaimed for a period of Seven years or more with Investor
Education & Protection Fund.
6. INFORMATION PERTAINING TO SUBSIDIARY COMPANY
Particulars relating to the Subsidiary Company as required under
Section 212 of the Companies Act, 1956 are annexed to the Balance Sheet
of your Company.
Sri A. C. Chakrabortti, Sri P. K. Mor and Sri S. Bagri retire from the
Board by rotation and being eligible offer themselves for re-election.
8. DIRECTORS RESPONSIBILITY STATEMENT
Pursuant to Section 217(2AA) of the Companies Act, 1956 your Directors
a) the applicable accounting standards have been followed in the
preparation of final accounts and that there are no material
b) such accounting policies have been selected and applied consistently
and judgments and estimates made are reasonable and prudent so as to
give a true and fair view of the state of affairs of the Company as at
31st March, 2004 and of the Profit and Loss of the Company for the year
ended on that date ;
c) proper and sufficient care had been taken 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 annual accounts have been prepared on the basis of a going
9. PARTICULARS OF EMPLOYEES
The provisions of the Companies (Particulars of Employees) Rules, 1975
read with Section 217(2A) of the Companies Act. 1956 are not
10. INFORMATION PERTAINING TO SECTION 217(1)(e)
Particulars of Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo as required pursuant to the
Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are annexed and forming part of this Report.
Relations with workmen and employees remained cordial during the year
under review. Your directors place on record their appreciation for the
co-operation they had received from them.
12. CORPORATE GOVERNANCE
The Board of Directors believe that the broad principles of Corporate
Governance ensure standardisation of corporate conduct. It focuses the
corporate conduct towards employees, consumers and society. A report of
Corporate Governance and Management Discussion and Analysis is given
separately and form part of this report.
The Certificate of the Auditors of your Company confirming compliance
of the conditions of Corporate Governance as stipulated in Clause 49 of
the Listing Agreement with the Stock Exchanges, is given in this
13. CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard 21 and pursuant to Clause 32
the Consolidated Financial Statements of the Group form part of this
Report & Accounts and this also contains the segment information in
terms of the Accounting Standard 17 issued by The Institute of
Chartered Accountants of India.
Messrs. Price Waterhouse, Chartered Accountants, the Auditors of the
Company and Messrs. Bagree & Co., Chartered Accountants, the Auditors
of MICCO Division retire and are eligible for re- appointment. The
Certificate as required under Sub-Section 1-B of Section 224 of the
Companies Act, 1956 has been obtained.
The Directors take this opportunity to record their appreciation for
all those who contributed to the success of your Company and look
forward to their continued support in the years to come.
Registered Office On behalf of the Board
S.India Exchange Place
Kolkata - 700 001 A. K. KOTHARI
Dated: 29th June, 2004.
ANNEXURE TO DIRECTORS REPORT
(Additional information given in terms of Notification No.l029 of
30.12.1988 issued by the Department of Company Affairs)
A. CONSERVATION OF ENERGY
(a) Energy conservation measures taken :
The company over the years has always accorded high priority to energy
conservation and has implemented various schemes on continuous basis to
save energy wherever possible. This continues to remain the thrust area
with studies, discussions and analysis being undertaken regularly for
Some of the measures taken are as under:
i) Use of Energy Saving Spindles, Booster Fans in Humidification plant.
ii) Replacement of Ordinary Choke with Electronic Choke for energy
iii) Utilisation of natural day light wherever possible.
(b) Additional investment and proposals, if any, being implemented for
reduction of consumption of energy:
Besides efforts as mentioned above, proposal to install digital process
indicator, replacement of old compressed air pipe line, energy saving
air compressor and installation of latest high power equipments are
under active consideration. Further steps are being taken to implement
me suggestion of the energy audit carried out by ATIRA.
(c) Impact of measures at (a) and (b) above for reduction of energy
consumption and consequent impact on the cost of production of goods :
The above measures have resulted in saving of energy with its
consequential effect to decrease the cost of production. Despite this,
cost of production increased due to increase in tariffs of electricity
and other inputs.
(d) FORM A
B. TECHNOLOGY ABSORPTION
Research and Development (R & D): R & D is carried out by the Company
for increase tn
1. Specific areas in which R&D is carried out : production,
improvement in quality of products, production process and innovating
2. Benefit derived as a result of the above R&D : Economising the cost
and improving quality of the products.
3. Future plan for action : We are committed to strengthen the R & D
activities to improve its competitiveness by procuring and installing
suitable machines/equipments as and when required.
4. Expenditure on R & D
(d) Total R&D Expenditure as a percentage of total turnover
As per established accounting policy, the expenditure incurred on R & D
remains merged with various heads.
Technology absorption Adaptation and Innovation
i) Efforts in brief made towards
Technology absorption, adaptation and innovation.
By keeping track of latest development in the fields of technology,
efforts are continuously made to procure the latest
Machines/Equipments. The Company has installed at Akbarpur latest model
Savio Autoconer, LF 1400 Speed Frame, `C Cleaner, Lycra attachment,
Slub Motion attachment, MBO for homogenous mixing
ii) Benefit derived as a result of above efforts e.g. Output
Improvement, Cost reduction, Product development & Import
The latest technology is being adopted in plants for improving
productivity, product quality and reducing the consumption of energy.
iii) Details of Imported Technology. No need has been felt for
acquiring any imported technology.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
f) Activites relating to exports, initiatives taken to Increase
exports, developments of new export market for products and Yarn prices
in domestic market were more lucrative services and export plans than
export prices which induced us to reduce exports. However, new value
added products for premium customers are being developed for export
g) Total foreign exchange used and earned
i) Foreign Exchange used during 2003-2004 Rs. 74.35 Lacs.
ii) Foreign Exchange earned during 2003-2004 Rs. 233.70 Lacs.
On behalf of the Board
Kolkata 29th June, 2004. Chairman