1.   COMPANY OVERVIEW :
 
 The company was incorporated on 6th March, 1989 under the laws of
 republic of india and has its registered office at kolkata,West bengal.
 The company is engaged in manufacturing and export of cotton yarn and
 other various merchandise.  The shares of the company are listed in
 National stock exchange and Bombay stock exchange. Company has set up
 100% export oriented unit with the state of art, Plant with export
 capacity of 55440 spindles at Kolhapur in Maharashtra. The Company was
 also awarded International standard organization certificate for export
 performance. The Company''s marketing network is spread over in
 various countries. The Company also doing trading in export of cotton
 yarn arid various commodities.  The Company is merchant exporter also.
 The Company has taken up for setting of yarn deying and cotton
 bleaching plant at Kolhapur. 
 
 i) Rupee Term loan from Canara Bank - Kolkata, Oriental Bank of
 Commerce - Kolkata and State Bank of Patiala - Mumbai is secured by
 
 (a) an equitable mortgage ranking pari passu inter-se by deposit of
 title deeds of all the immovable properties of the company both present
 and future, relating to its spinning unit premises at Village : Yavluj,
 District : Kolhapur, Maharastra and
 
 (b) by way of hypothecation ranking pari passu inter-se of all movable
 properties of the company both present and future including movable
 machineries, spares, tools & accessories (save & except book debts)
 subject to prior charges created or to be created in favour of the
 Company''s Bankers, on its stock of Raw Materials, finished goods,
 consumable stores, book debts & such other movables as may be
 specifically permitted by the institutions in writing, to secure
 borrowings for working capital requirements and
 
 (c)  Personal guarantee of some of the Directors of the Company.
 
 iii) Working Capital Term Loan from Canara Bank, Overseas Branch,
 Kolkata is secured by way of :
 
 (a) hypothecation of stock of Raw materials, Work-in-process, finished
 goods and book debts relating to spinning unit at Village : Yavluj,
 District : Kolhapur, Maharastra and stock-in-trade at trading unit
 Kolkata,
 
 (b) Second charge on immovable properties of the company relating to
 above mentioned spinning unit, and
 
 (c) Personal guarantee of some of the Directors of the Company.
 
 i) Working Capital Loan from Canara Bank, Overseas Branch, Kolkata &
 Mumbai , Oriental Bank of Commerce, Overseas Branch, Kolkata, Allahabad
 Bank, Industrial Finance Branch, Kolkata, State Bank of Patiala -
 Commercial Branch,Mumbai and ICICI Bank Limited, Kolkata are secured by
 way of :
 
 (a) First charge by way of hypothecation of stock of Raw materials,
 Work-in-process, finished goods and book debts relating to spinning
 unit at Village : Yavluj, District: Kolhapur, Maharastra and
 stock-in-trade at trading unit Kolkata, both present and future in a
 form and manner satisfactory to the bank, ranking pari pasu with each
 other participating working capital banks.
 
 (b) Second charge on all the fixed assets of the company, both present
 and future ranking pari pasu with each other participating working
 capital banks.
 
 (c) Personal guarantee of some of the Directors of the Company.
 
 ii) Previous Year working Capital Loan includes working capital loan
 from ING Vysya Bank Limited, Overseas Branch, Mumbai was secured by way
 of:
 
 (a) hypothecation of stock of raw materials, work in process, Finished
 goods, book debts relating to spinning unit at Village : Yavluj,
 District : Kolhapur, Maharastra and
 
 (b) second charge on immovable Properties of the Company relating to
 above mentioned spinning unit and
 
 (c) Personal guarantee of some of the Directors of the Company.
 
 i) The Company Has not received any information its suppliers regarding
 registration under The Micro, Small and Medium Enterprises
 Development Act, 2006  Hence, the information required to be given
 in accordance section 12 of the said Act, is not ascertainable. Hence,
 not disclosed.
 
 ii) The Company has also computed and made necessary provisions on
 account of leave encashment benefits based on acturial valuation as per
 accounting standard - 15 (Revised) Employee Benefits The total
 service eligibility as per the company''s leave rules are estimated
 and provided in Ihe books as a revenue expenditure after making
 adjustment towards the benefit paid on this benefit obligation were
 carried out at 31st March 2012
 
 2 CAPITAL COMMITMENTS :
 
 Estimated amount of contracts remaining to be executed on Capital
 Account and not provided for Rs. 2948.91 Lacs (Net of advances)
 (Previous Year Rs. Nil Lacs).
 
 3CONTINGENT LIABILITIES NOT PROVIDED FOR IN RESPECT OF :
 
 i.  Bills discounted with Banks Rs. 4199.76 Lacs (Previous Year Rs.
 5918.49 lacs).
 
 ii.  Bank Guarantees of Rs. 371.37 Lacs (Previous Year Rs. 341.70 lacs)
 issued in favour of Custom, Central Excise & Other Government
 Authorities.
 
 iii. Disputed Statutory Dues
 
 a) The Income Tax Assessment of the Company have been completed up to
 Assessment Year 2009-2010. Disputed Income Tax Liabilities for which
 appeal is pending before different appellate authorities for Assessment
 Year 2000- 2001, 2005-2006, 2006-2007 & 2008-2009 are Rs. 328.78.
 
 b) Disputed Central Excise liability for which appeal is pending before
 different excise authorities relating to financial year from 2005-2006
 is Rs. 27.13 Lacs.
 
 c) Disputed Central Service Tax liability for which appeal is pending
 before different Service Tax authorities relating to financial year
 from 2004-2005, 2005-2006 & 2009-2010 is Rs. 25.15 Lacs.
 
 Based on the decision of the Appellate authorities and the
 interpretations of the other relevant provisions, the Company has been
 legally advised that the demand is likely to be either deleted or
 substantially reduced and accordingly no provision has been made.
 
 4. As per Accounting Standard 28 issued by the institute of Chartered
 Accountants of India, the company has assessed recoverable value of
 generating unit based on value in used method which has worked out to
 be much higher than corresponding book value of net assets thereby not
 warranting further exercise of arriving at their net selling price.
 This further confirms absence of exigency of making any provision for
 impairment of asset(s).
 
 5. The financial statements for the year ended March 31,2011 had been
 prepared as per applicable, pre-revised schedule VI to the companies
 Act, 1956. Consequent to the notification of Revised schedule VI under
 the Companies Act. 1956, the financial statements for the year ended
 March 31,2012 are prepared as per revised Schedule VI. Accordingly the
 previous year figures have also been classified to confirm to this year
 classification. The adoption of revised Schedule VI for previous year
 figures does not impact recognition and measurement principle followed
 for preparation of financial statements.