To the Members,
 
 The Directors have pleasure in presenting the 61st Annual Report on
 the working of your Company for the financial year ended 31st March
 2011.
 
 Accounting Year
 
 The year under report covers a period of 12 months ended on 31st March
 2011.  Financial Performance
 
 The Comparative position of the working results for the year ended
 vis-à-vis earlier year is as under:
 
                                                         (Rs. Crores)
 
                                    2010-2011              2009 -2010
 
 Gross Earnings                          4020                    3896
 
 Gross Profit (before 
 interest, depreciation, 
 items relating to earlier
 years, exceptional
 items & tax)                            1156                     849
 
 Less: Interest                            64                      53
 
 Depreciation                      465    529         380         433
 
 Profit before items relating 
 to earlier years, exceptional 
 items & tax                              627                     416
 
 Prior year''s adjustments                  30                      (6)
 
 Excess Provision / sundry credit 
 balances written back                      0                      66
 
 Profit before Exceptional 
 items & tax                              657                     476
 
 Exceptional items                          - 
 
 Provision for Indian Taxation            (89)                    (99)
 
 Net Profit                               568                     377
 
 Appropriations
 
 The working results of your Company for the year 2010-2011 after
 considering prior period adjustments show a profit of Rs. 567.35 crores.
 An amount of Rs. 114 crores has been transferred to Tonnage Tax Reserve
 u/s 115VT of Income Tax Act.  After adding a sum of Rs. 516.63 crores
 (being balance profit and loss account brought forward from the
 previous year), the amount available for disposal works out to Rs.
 969.98 crores. Your Directors propose to make the following
 appropriations from this amount:
 
 1.  Capital Reserve                       Rs.  17.59 crores
 
 2.  General Reserve                       Rs.  57.00 crores
 
 3.  Staff Welfare Fund                    Rs.   1.00 crore
 
 4.  Corporate Social Responsibility 
     Reserve                               Rs.   5.67 crores
 
 Total                                     Rs.  81.26 crores
 
 Dividend
 
 The Board of Directors, in addition to the interim dividend @ 30%
 already paid for the year 2010-11, now recommends payment of final
 dividend @ 25% for the year 2010-11 absorbing a sum of Rs. 116.45
 crores. In addition, dividend tax of Rs.18.89 crores will be payable by
 the Company. After the proposed appropriations, the sum available is
 Rs. 590.43 crores which is being carried forward to next year''s
 accounts.
 
 Fleet Position during the Year :
 
 During the year under report, nine vessels aggregating 520,259 dwt.
 tonnage were disposed of whereas four new building crude oil tankers and
 eight new building product tankers aggregating to 1,109,145 dwt. were
 delivered. Thus, the overall fleet position, which was 76 ships at the
 beginning of the year, closed at 79 ships at the end of the year as
 shown in the following table:
 
 FLEET PROFILE DURING THE YEAR
 
 Particulars    As on 1.4.2010    Additions    Deletions  As on 31.3.2011
 
                No.       Dwt.    No.      Dwt. No.     Dwt. No.     Dwt.
 
 1. (a) 
 Crude Oil 
 Tanker          26  35,76,271     4   458,942   6   402,916 24 36,32,297
 
 (b) Product 
 Tankers         10   4,23,172     8   650,203   2    90,893 16  9,82,483
 
 (c) Chemical 
 Tankers          3     99,174     -         -   -         -  3    99,174
 
 (d) Gas 
 Carriers         2     35,202     -         -   -         -  2    35,202
 
 2.  Bulk 
 Carriers        18    781,777     -         -   1    26,450 17   755,327
 
 3.  Liner 
 Ships            5    202,413     -         -   -         -  5   202,413
 
 4.  Offshore 
 Supply Vsls.    10     17,904     -         -   -         - 10    17,904
 
 5. Passenger-
 Cum-
 Cargo Vessels    2      5,303     -         -   -         -  2     5,303
 
 Total           76  51,41,216    12  1,109145   9   520,259 79 57,30,103
 
 
 NEWBUILDING VESSELS DELIVERED DURING THE YEAR
 
 Vessel Name       Type         Yard Built                     Dwt.
 
 m.t. Desh Mahima  Crude oil 
                   Tanker       Hyundai Heavy Industries 
                                (HHI), S.Korea                114,686
 
 m.t. Desh Garima  Crude oil 
                   Tanker       HHI, S.Korea                  114,790
 
 m.t. Desh 
 Suraksha          Crude oil 
                   Tanker       HHI, S.Korea                  114,783
 
 m.t. Desh Samman  Crude oil 
                   Tanker       HHI, S.Korea                  114,683
 
 m.t. Swarna 
 Sindhu            Product 
                   Tanker       STX Shipyard, S.Korea          73,368
 
 m.t. Swarna Ganga Product 
                   Tanker       STX Shipyard, S.Korea          73,368
 
 m.t. Swarna 
 Brahmaputra       Product 
                   Tanker       STX Shipyard, S.Korea          73,606
 
 m.t. Swarna 
 Godavari          Product 
                   Tanker       STX Shipyard, S.Korea          73,368
 
 m.t. Swarna 
 Krishna           Product 
                   Tanker       STX Shipyard, S.Korea          73,368
 
 m.t. Swarna 
 Kaveri            Product 
                   Tanker       STX Shipyard, S.Korea          73,368
 
 m.t. Swarna 
 Jayanti           Product
                   Tanker       HHI, S.Korea                  104,895
 
 m.t. Swarna Kamal Product 
                   Tanker       HHI, S.Korea                  104,862
 
 
 VESSELS DISPOSED OF DURING THE YEAR
 
 Vessel Name                Type                  Year Built    Dwt.
 
 m.v. Lok Rajeshwari        Bulk Carrier              1988     26,450
 
 m.t. Lance Naik Karam 
 Singh, PVC                 Crude Oil Tanker          1984     67,153
 
 m.t. Lt. Rama Raghoba 
 Rane, PVC                  Crude Oil Tanker          1984     67,153
 
 m.t. Subedar Joginder 
 Singh, PVC                 Crude Oil Tanker          1984     67,137
 
 m.t. Major Saitan Singh, 
 PVC                        Crude Oil Tanker          1985     67,185
 
 m.t. Havildar Abdul 
 Hamid, PVC                 Crude Oil Tanker          1985     67,164
 
 m.t. Col. Ardeshir 
 Burzorji Tarapore, PVC     Crude Oil Tanker          1985     67,124
 
 m.t. Major Hoshiar 
 Singh, PVC                 Product Tanker            1985     45,420
 
 m.t. Lance Naik Albert 
 Ekka, PVC                  Product Tanker            1985     45,473
 
 
 VESSELS ON ORDER AT THE END OF THE YEAR
 
 Type                     No.  Shipyard                       Total Dwt.
 
 VLCC                      2   Jiangsu Rongsheng Heavy 
                               Industries Co. Ltd. China       6,34,000
 
 Handymax Bulk Carriers    6   STX (Dalian) Shipbuilding 
                               Co. Ltd. China                  3,44,400
 
 Kamsarmax Bulk Carriers   4   Jiangsu Eastern Heavy 
                               Industry Co. Ltd. China         3,28,000
 
 Panamax Bulk Carriers     4   STX (Dalian) Shipbuilding 
                               Co. Ltd. China                  3,22,620
 
 6,500 TEU Cellular 
 Container vessels         3   STX (Dalian) Shipbuilding Co.
                               Ltd. China                      2,56,800
 
 Anchor Handling, 
 Towing & Supply
 Vessels (AHTSVs) (80T BP) 4   Bharati Shipyard Ltd. India        8,000
 
 Anchor Handling, 
 Towing & Supply vessels 
 (AHTSVs) (120 T BP)       2   Cochin Shipyard Ltd. India         3,940
 
 Anchor Handling, 
 Towing & Supply vessels 
 (AHTSVs) (120 T BP)       2   Cochin Shipyard Ltd. India         3,940
 
 Platform Supply Vessels
 (UT 755 Design)           2   Cochin Shipyard Ltd. India         6,120
 
 TOTAL VESSELS ON ORDER   29                                  19,07,820
 
 
 Implementation of Official Language Policy
 
 Your Company put in all-out efforts to promote and popularize the use
 of Official Language Hindi in its day-to-day official work and ensured
 compliance of the provisions of the Official Language Act, 1963 and the
 Official Language Rules, 1976 during the year under report. On the
 occasion of Golden Jubilee Year celebration, you company organized an
 all-India level conference Sagar Manthan at its Maritime Training
 Institute, Mumbai, which was attended to by over 120 participants from
 various PSUs and Government Offices across the country.
 
 In addition to this, your Company also acquired corporate license
 (unlimited users) of bilingual software viz. APS Saral, to increase the
 use of Hindi on computers, and made almost all PCs Unicode Hindi font
 enabled. As far as Hindi training is concerned, SCI is determined to
 impart bilingual software training to its employees regularly at its
 Maritime Training Institute so as to achieve the set targets in the
 Annual Programme issued by the Central Government. SCI''s website is
 also available in Hindi and English bilingually.
 
 During the year under report, your Company organized quarterly meetings
 of its Departmental Official Language Implementation Committee wherein
 a review on overall progress of Hindi in its offices was made and
 thereafter appropriate follow up actions were taken. Besides this, a
 number of Hindi promotional activities, competitions and programmes
 like Hindi Kavi Sammelan were also organized.
 
 Particulars of Employees
 
 Information as per Section 217(2A) of the Companies Act, 1956 read with
 the Companies (Particulars of Employees) Rules 1975 and Companies
 (Particulars of Employees) Amendment Rules, 1988, forms part of this
 report. Any shareholder interested in obtaining a copy of this
 information may write to the Company Secretary at the Registered Office
 of the Company.
 
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rules 1988
 
 In terms of the Notification No. GSR 1029 dated 31.12.1988, your
 Company is required to furnish information under Clause (e) of
 Sub-section (1) of Section 217 of the Companies Act, 1956. The
 information to be furnished in Form A is not applicable to the shipping
 industry. Your Company, being a shipping company, has no particulars to
 furnish in Form B as regards technology absorption. The foreign
 exchange earnings and outgo during the year under report were as under:
 
 Foreign exchange earned and saved including deemed earned and saved Rs.
 3736.53 crores.
 
 Foreign exchange used including deemed used Rs. 3103.94 crores.
 
 Expenses on Entertainment, Foreign Tours, etc.
 
 During the year under report your Company spentRs. 61 lakhs on
 entertainment, Rs. 269 lakhs on publicity & advertisements and Rs. 371
 lakhs on foreign tours of Company''s executives.
 
 Board of Directors
 
 Shri A.K. Mago, A.D. Fernando, U. Sundararajan, J.N.L. Srivastava, B.H.
 Dholakia and Keshav Saran ceased to be Directors w.e.f. 28.07.2010
 consequent to the cessation of their tenure as non-official part-time
 Directors. Shri U.C. Grover and Capt. K.S. Nair ceased to be Directors
 on the Board consequent to their superannuation on 31.08.2010 and
 31.12.2010, respectively. The Board places on record its appreciation
 for the valuable services rendered by them.
 
 In terms of the nominations received from the Ministry of Shipping,
 eight non-official part time(independent) Directors have been appointed
 / reappointed on the Board of Directors. S/Shri Nasser Munjee, Sushil
 Tripathi and U. Sundararajan have been reappointed and S/Shri Arun
 Ramanathan, Arun Kumar Verma, Prof. Sushil Khanna and Rear Admiral
 (Retd.) T.S. Ganeshan have been appointed on the Board w.e.f
 11.08.2010.
 
 The Board has also appointed Shri S.K. Roongta as non-official part
 time Director w.e.f. 13.12.2007 on his nomination by the Ministry of
 Shipping Road Transport & Highways. Shri Arun Kumar Gupta and Capt.
 Sunil Thapar have been appointed as Director (Technical & Offshore
 Services) and Director (Bulk Carriers & Tankers) by the President of
 India w.e.f. 24.10.2010 and 11.01.2011, respectively. They hold office
 up to the date of the forthcoming Annual General Meeting and being
 eligible, offer themselves for appointment Shri B.K. Mandal, Shri J.N.
 Das, Shri Nasser Munjee and Shri S.C.  Tripathi are retiring by
 rotation at the forthcoming Annual General Meeting and, being eligible,
 offer themselves for appointment.
 
 Auditors Report
 
 The Auditors Report is attached to the Report. The Statutory Auditors
 had, in respect to the Audited Accounts for the year ended 31.03.2011,
 drawn the attention of the members on issues mainly arising out of
 switching over to integrated ERP System which are mentioned below.
 
 1) The Auditors observed that various errors and omissions were made by
 the Company during the process of migration / uploading of data post
 migration in the new accounting software ERP-SAP in respect of
 accounting of the income and expenses, assets and liabilities for which
 necessary rectification were carried out by the Company.
 
 2) They further observed that, there remain certain items where the
 company is unable to make appropriate adjustment and the effects of
 errors and adjustments, if any, as might have been determined to be
 necessary in the data migrated / uploaded in the accounting software
 post migration.
 
 3) It has been further pointed out by them that the Company has:
 
 i) Not accounted the income and expenditure in respect of unfinished
 voyages as per accounting policy No. 2 (c) having no impact on the
 profit for the year.
 
 ii) Not accounted the foreign currency transactions at the rates as
 stipulated in Accounting Policy No. 8 (a) for the months of January
 2011 and February 2011 instead, the same have been accounted at the
 exchange rates applicable for the month of March 2011.
 
 4) The statutory Auditors observed some weakness in design of internal
 control in respect of migration of the data / uploading of the data in
 the process of implementation of ERP-SAP. They however concluded that
 as at the balance sheet data, the material errors and omission
 affecting the results as observed during the course of their audit were
 rectified by the company.
 
 5) The Statutory Auditors further pointed out that post implementation
 of the ERP-SAP, the internal auditor expressed inability to cover many
 areas and report thereon including accounting of income and expenses on
 finished and unfinished voyages, etc.
 
 The replies of the Management to the Auditors'' observations are given
 below.
 
 1) Post migration to SAP, errors coming to our notice have been
 attended to and necessary adjustments are carried out.
 
 2) The Management has brought out in Schedule 25, Notes on Accounts,
 such cases where adjustments have not been possible due to issues
 arising on migration and uploading of data in the new system. The
 Management has also brought out therein that these have no material
 impact on the results of the Corporation.
 
 3) (i) As per accounting policy no. 2 (c) of the company, for all
 unfinished voyages, amount received on account of freight earning and
 other charges in respect of such voyages are carried forward as
 Unfinished Voyage Earnings.  Direct operating expenses incurred for
 such voyages including hire charges and freight for vessels
 chartered-in are carried forward as Unfinished Voyage Expenses except
 in case of time charter. As far as unfinished voyages are concerned the
 booking of both income and expenditure is done by SCI consistently on
 receipt / disbursement basis. It is in line with the accounting policy
 2 (c) of the company.
 
 (ii) As per accounting policy 8(a), All foreign currency transactions
 are recorded at the exchange rate of the last Friday of the preceding
 month published in Financial Times, London.
 
 There were no transactions from 1st February to 27th February either in
 the legacy or in the new system as it was a Blackout period prior to
 data migration to SAP.
 
 The comparative rates for some of the major currencies for February
 2011 and March 2011 are as below:
 
 Currency    February 2011     March 2011      % difference
 
 Euro            62.632          62.311        (-) 0.005%
 
 USD             45.615          45.325        (-) 0.006%
 
 SGD             35.670          35.591        (-) 0.002%
 
 UKP             72.705          72.846        ( ) 0.002%
 
 Since the exchange rate difference for the month of February 2011 and
 March 2011 are insignificant, there is no material impact. Moreover,
 before migration, revaluation run was carried out in legacy system for
 January, 2011.
 
 4) During data migration, even though a matched trial balance was
 uploaded but certain deficiencies were subsequently observed by the
 company in respect of line item wise migrations indicating details like
 foreign currency component, dates of invoices and debit notes, etc.
 Care has been taken to rectify such deficiencies as and when observed.
 
 The new system went live on 28.02.2011. The time available before the
 Annual Closing was not sufficient for the Internal Auditors; at
 present, the Internal auditors are carrying out the audit.
 
 Corporate Governance
 
 Pursuant to Clause 49 of the Listing Agreement, Report on Corporate
 Governance is attached to this Report.
 
 Directors'' Responsibility Statement
 
 Pursuant to the requirement under Section 217(2AA) of the Companies
 Act, 1956, with respect to Directors'' Responsibility Statement, it is
 hereby confirmed:
 
 That in the preparation of the accounts for the financial year ended
 31st March 2011, the applicable accounting standards have been followed
 along with proper explanation relating to material departures;
 
 That the Directors have selected such accounting policies and applied
 them consistently and made judgements and estimates that were
 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 financial year and of the
 profit or loss of the Company for the year under review;
 
 That the Directors have 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;
 
 That the Directors have prepared the accounts for the financial year
 ended 31st March, 2011 on a going concern basis.
 
 Acknowledgements
 
 Your Directors take this opportunity to express their gratitude and
 thanks to Shri G.K. Vasan, Hon''ble Minister for Shipping, and Shri
 Mukul Roy, Hon''ble Minister of State in the Ministry of Shipping, and
 look forward to their support and guidance in managing the affairs of
 the Company.
 
 Your Directors also extend a hearty welcome to Shri K. Mohandaas,
 Secretary to the Government of India, Department of Shipping, Ministry
 of Shipping, and look forward to his support and guidance.
 
 Your Directors also wish to express their thanks to the officials in
 the Ministry of Shipping, for the unstinted support given by them in
 various matters concerning the Company. Your Directors would also like
 to convey their thanks to other Ministries, Trade Organizations,
 Shippers'' Councils, who have played a vital role in the continued
 success of your Company.
 
 The Directors thank the shareholders and valued customers for the
 continued patronage extended by them to your Company.
 
 Last but not the least, your Directors wish to record their deep
 appreciation for the dedicated and loyal service of your Company''s
 employees, both afloat and ashore, without whose co-operation and
 efforts the achievements made by your Company would not have been
 possible.
 
                          For and on behalf of the Board of Directors 
 
 Place : Mumbai                               S. Hajara
 
 Dated : 13th August, 2011           Chairman & Managing Director