The Directors submit the following report on Financial Results for the
year ended 31 st March, 201 4:
Financial Results: For the year For the year
31st March, 31st March,
(Rs in lacs) (Rs in lacs)
Turnover 83.76 3,808.73
Profit / (Loss) before depreciation (6,685.52) (5,266.36)
Depreciation (net of revaluation adjustment) 228.92 1,478.20
Profit / (Loss) before tax (6,914.44) (6,744.56)
Provision for Deferred Tax - Assets 2,785.19 1,747.51
Profit / (Loss) after tax (4,129.25) (4,997.05)
Surplus /(Deficit) brought forward from
previous year (23,757.45) (18,760.40)
Surplus /(Deficit) carried forward to
Statement of Profit & Loss (27,886.70) (23,757.45)
The plant was shut down for the whole year. Consequently during the
year sponge iron production was Nil as compared to 12430 MT in the
previous year. Billet production was Nil for both years. Power
Generation during the year was Nil as compared to 11,950,647 KWH in the
previous year. The Company generated total revenue of ? 84 lacs
compared to ? 3,809 lacs in the previous year. The Company suffered
loss for this year also amounting to ? 4,129 las as compared to ? 4,997
lacs in the previous year. Future Outlook
Your Directors are pleased to report that after obtaining Forest
Clearance for operating the Iron Ore Mines allotted to the Company from
the Ministry of Environment and Forest (MOEF), your Company has taken
steps for compliance of all conditions and requirements for
commencement of mining operation at the earliest. Grama Sabha Meeting,
which is requirement under the Forest Rights Act, 2006 was held on 20th
July, 2014. Compliance of other conditions of Stage I Clearance is
being attended on top priority. Availability of iron Ore from own mines
will vastly improve production and profitability. Your Directors
express their sincere gratitude to all concerned for bearing with the
Company during the difficult time.
Meanwhile your Company is trying to finalise conversion agreement with
other steel producers for conversion of Iron Ore/Pellets into sponge
iron at our plant which will help the Company to restart the plant
operations. The recent measures taken by the concerned authorities to
facilitate iron ore supply and restoration of coal linkage will improve
the cost economics for plant operations.
Bamra Iron & Steel Company (India) Ltd. is a wholly owned subsidiary of
the Company. Since the said Company has not started its operations,
consolidated financial statement has not been prepared.
Your Directors regret their inability to recommend any dividend for the
year in view of losses. Preference Shares
Inter Corporate Loan received by the Company amounting to ? 20 crores
was converted into Advance received for issue of Preference Shares as
on 31.03.2014. Subsequently 10% Cumulative Non Convertible Preference
Shares of ? 10 each at par amounting to? 20 crores has been issued and
allotted on private placement by adjusting the said Advance at the
Board Meeting held on 14.08.2014.
Project & Engineering Division
The Project and Engineering (P&E) division is continuing its work of
supplying process know-how and basic engineering to several existing
sponge iron units as well as new units who call for such services. It
has widened its network to include consultancy and supervisory services
for renovation, up- gradation and re-commissioning of the mini steel
plants with Sponge Iron, Power, Steel Melting Shop and Rolling Mills.
It also takes up assignment for carrying out technical audit of
Company''s plant health, process health, quality, safety, energy
efficiency and environment protection on a regular basis and
recommeding corrective measures. During the year under review, this
division has taken up an assignment from a Russian Company for
conversion of their Refractory Kiln to DRI Kiln. The contract, which
also provides for process guarantee for DRI production is presently
In line with your Company''s philosophy, your Company continues to
pursue a comprehensive programme of Community Development covering
education, immunization, agricultural & horticultural extension, mother
& child care etc. directly and also through OSIL TRFI Community
Services Trust. However due to financial losses suffered by the Company
not much support could be extended for such activities during the year.
Your Company continues to follow the Quality Management System for
production and supply of Sponge Iron and Steel Billets and possesses
Certificate of Registration of ISO 9001:2008 from British Certification
Inc. Your Company is proud of maintaining the clean environment in the
vicinity of the Plant and your Company''s Environmental Management
System applicable to production and supply of Sponge Iron and Steel
Billets has been certified under ISO 14001:2004 by British
Certification Inc. The Occupational Health and Safety Management System
of your Company has also been certified by the same Agency and your
Company complies with the requirements of OHSAS 18001:2007.
The annual listing fees have been paid to the Stock Exchanges where the
Company''s shares are listed. Your Company''s application to National
Stock Exchange (NSE) for listing and Calcutta Stock Exchange for
de-listing is pending before the respective Exchanges.
Reconciliation of Share Capital
In compliance of the directions of Securities and Exchange Board of
India (SEBI), reconciliation of share capital is being carried out
quarterly by a Practising Company Secretary. The findings of the
reconciliation of share capital were satisfactory.
Pursuant to Section 149,152 and other applicable provisions of the
Companies Act, 2013 and Rules made there under, your Directors are
seeking appointment of Mr. A. K. Mukherjee, Mr. S. K. Khetan and
Mr. B. K. Sarkar, as independent Directors for period of 5 years
from the date of the ensuing Annual General Meeting. The above
Directors meet the criteria for indepndence as provided in Section
149(6) of the Companies Act, 2013. Details of the proposal for
appointment of the above Independent Directors are mentioned in
the Notice of the 34th Annual General Meeting and the Explanatory
Statement under Section 102 of the Companies Act, 2013.
Mr. P. C. Mohanty retires by rotation at the ensuing Annual General
Meeting and being eligible offers himself for re appointment.
Your Directors recommend the appointments/reappointment as mentioned
above for approval of the Shareholders.
Conservation of energy, technology absorption, foreign exchange earning
The information required under Section 217 (1) (e) of the Companies
Act, 1956 read with the Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988 as amended are set out in
Annexure, which forms part of this Report.
Particulars of Employees
There were no employees drawing the requisite remuneration whose names
are required to be disclosed as required under sub-section 2A of
Section 217 of the Companies Act, 1956 read with the Companies
(Particulars of Employees) Rules, 1975 as amended from time to time.
Lock out declared at the plant on 14.10.2012 was lifted on 30.12.2013
following amicable settlement with the Workers'' union on 27.12.2013.
Directors'' Responsibility Statement
In accordance with the provisions of sub-section 2AA of Section 217 of
the Companies Act, 1956, your Directors state that:
(a) In the preparation of the Annual Accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures.
(b) Accounting policies selected are applied consistently. Judgments
and estimates that are reasonable and prudent are made, so as to give a
true and fair view of the state of affairs of the Company as at 31 st
March, 2014 and of the loss of the Company for the year ended on that
(c) Proper and sufficient care has 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 Accounts for the financial year ended 31st March, 2014 have
been prepared on a ''going concern'' basis. Auditors
The Statutory Auditors, M/s L. N. More & Co., Chartered Accountants,
Cuttack, will retire at the conclusion of the ensuing Annual General
and being eligible offer themselves for re-appointment.
The Audit Committee and the Board has recommended their re-appointment.
The necessary Resolution is being placed before the shareholders for
approval. The Company has received confirmation that their appointment
will be within the limits prescribed under Section 224 (1B) of the
Reference to Annexure to the Audit Report vide Para 9 (a), your
Directors submit that due to shut down of plant operations for the last
two years and
the absence of regular flow of funds, fund situation has become
critical. Consequently the undisputed liability on account of Central
Sales Tax, Orissa
Sales Tax and Entry Tax could not be paid due to fund constraints.
There are no other qualifications or adverse remarks in the Auditor''s
Report which require any clarification/explanation. The Notes on
part of the financial statements are self-explanatory and needs no
Pursuant to the provision of Section 233B of the Companies Act, 1956
and The Companies (Cost Accounting Records) Rules, 2011, M/s. B. Ray &
Associates, Cost Accountants, Kolkata has been re-appointed as Cost
Auditor of the Company for the year 2014-15 to conduct audit of cost
records maintained by the Company.
Pursuant to Clause 49 of the Listing Agreement with the Stock
Exchanges, the following documents form part of the Annual Report:
(a) Management Discussion and Analysis
(b) Report on Corporate Governance along with Certificate for
compliance of conditions of Corporate Governance
(c) Managing Director''s declaration regarding compliance of code of
conduct by Board Members and senior management personnel.
Acknowledgement and Appreciation
The Directors acknowledge with gratitude the co-operation extended by
Indian Renewable Energy Development Agency Ltd. (IREDA), Banks, State
Government, Suppliers, Customers and Shareholders and solicit their
continued support. The Directors also wish to place on record their
sincere appreciation of the dedicated services put in by the Company''s
workers, staff and executives under difficult conditions.
For and on behalf of the Board
Munir Mohanty, Director
Dr. P. K. Mohanty, Vice Chairman
& Managing Director
Dated: 14th August, 2014