The Directors are pleased to present their 137th Annual Report
 together with the statement of Accounts of your Company for the year
 ended 31st March, 2012.
 
 FINANCIAL RESULTS :                     For the 
                                      Year ended        For the 
                                                     Year ended
                                      31-03-2012     31-03-2011
                                          Rupees         Rupees
 
 Profit (Loss) for the 
 period before interest,               61,58,581      65,79,738
 depreciation and taxation
 
 Less: Interest                            -              -
 
 Depreciation                          20,79,834      23,06,732
 
 Taxation                                  -              -
 
 Profit/(Loss) after interest,         40,78,747      42,73,006
 depreciation and
 taxation
 
 Deficit brought forward from 
 the previous year                (225,62,17,351) (226,04,90,357)
 
 Total deficit carried 
 to Balance Sheet                 (225,21,38,604) (225,62,17,351)
 DIVIDENDS
 
 The Directors do not recommend any dividend in order to reduce the
 deficit and strengthen the Balance Sheet of the Company.
 
 OPERATIONAL REVIEW
 
 The Company is in the business of textiles.
 
 BIFR
 
 The Company is under BIFR (Board for Industrial & Financial
 Reconstruction) under CaseNo.135 / 1989. The BIFR has sanctioned a
 Rehabilitation Scheme for the company (SS-07) vide their Order dated
 22,2,2007. This Rehabilitation Scheme is under implementation.
 
 DIRECTORS
 
 Ms. Neesha S. Khatau and Mr. B. S. Desai, retire by rotation at the
 forthcoming Annual General Meeting, and being eligible, offer
 themselves for re-appointment.
 
 DEPOSITS
 
 The company has not accepted any fresh deposits during the year.
 
 PARTICULARS OF EMPLOYEES
 
 There were no employees covered under Section 217 (2A) of the Companies
 Act 1956 read with the Companies (Particulars of Employees) Rules,
 1975, as amended, during the year under review.
 
 LISTING
 
 a.  The Company has obtained Listing Approval from BSE in respect of
 preferential allotment of 17,49,000 equity shares to the promoters of
 the Company as per Clause 11 (h)(iv) of the scheme.
 
 b.  The Company has paid listing fees.
 
 c.  The application made by the Company to obtain trading permission of
 the shares is pending before BSE.
 
 COMPLIANCE CERTIFICATE
 
 Compliance Certificate obtained under Section 383Aof the Companies Act,
 1956 read with Companies (Issue of Compliance Certificate) Rules, 2001
 from M/s. P P Shah & Co., Practising Company Secretaries is annexed
 herewith.
 
 AUDITORS'' REPORT
 
 As regards the observations, reservations or qualifications of the
 Auditors in the Auditors'' Report, the relevant notes on the Accounts
 are self-explanatory.
 
 AUDITORS
 
 The Company''s auditors Messrs Sorab S. Engineer & Co., Chartered
 Accountants, hold office up to the conclusion of the ensuing Annual
 general meeting. The Company has received communication from them to
 the effect that their appointment, if made, would be within the limits
 prescribed under section 224(1 B) of the Companies Act, 1956. The Board
 proposes their re-appointment at the ensuing Annual General Meeting of
 the Company.
 
 PARTICULARS OF CONSERVATION OF ENERGY. TECHNOLOGY ABSORPTION AND
 FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 In accordance with the provisions of section 217 (1) (e) of the
 Companies Act, 1956, the required information relating to Conservation
 of Energy, Technology Absorption, Foreign Exchange earnings and outgo,
 is not annexed to this Board Report since the rehabilitation scheme is
 in progress.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement u/s.217(2AA) of the Companies Act, 1956
 with respect to the Directors Responsibility Statement, it is hereby
 confirmed :
 
 (i) that in preparation of the annual accounts for the year ended
 31.03.2012 the applicable accounting standards had been followed along
 with proper explanations relating to material departures.
 
 (ii) that 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 period and of the profit of
 the Company for the period under report.
 
 (iii) that the Directors had 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) that the Directors have prepared the accounts for the period ended
 31.03.2012 on a ‘going concern basis''.
 
 ACKNOWLEDGEMENT
 
 The Directors wish to convey their appreciation to all the Company''s
 employees for their enormous personal efforts as well as their
 collective contribution to the Company''s performance. The Directors
 would also like to thank the shareholders for their continuous support
 given by them to the Company and their confidence in its management.
 
                           By Order of the Board of Directors 
 
                                              Panna S. Khatau
 
 Mumbai, 25th June, 2012                         Chairperson