Pradeep Drug Company Ltd was incorporated as a Public Limited Company
 at Madras on 26th March, 1990 and Certificate for Commencement of
 Business was obtained on 21st May, 1990.
 
 Pradeep Drug Company was originally started in 1983 by Mr. S.
 Mohanchand Dadha as a sole proprietary firm.  It had set up
 facilities at Maraimalai Nagar in Tamilnadu to manufacture bulk drugs
 like Erythromycin salts.  Pradeep Drug Company Ltd took over the
 entire assets and liabilities of Pradeep Drug Company, the above
 mentioned sole
 proprietary concern of Shri. S. Mohanchand Dadha as a going concern
 on 31.01.91 for a consideration of Rs.  1,34,43,653/-.  The company
 obtained necessary licenses issued by the Drugs Control Authorities
 for the manufacture of bulk drugs.
 
 The Company came out with the Public Issue of Equity Shares in June,
 1992 for the purpose of setting up, a 100% EOU project at
 Maduranthagam for manufacture of bulk drugs. 
 
 The project was completed and commercial production started in the
 month of April, 1994.  The Company holds the necessary licenses
 issued by the Drug Control authorities for manufacture of various
 bulk drugs at its factories situated at Maraimalai Nagar and
 Maduranthagam.
 
 As per the provisions applicable to the 100% Export Oriented Unit,
 the Company is permitted to sell only upto 25% of its production in
 the domestic market.  The products with which the 100% EOU was
 started namely Analgin and Mebendazole were mainly meant for exports.
  Whereas the Company has now suspended the production of Analgin and
 shall be starting new products like Roxythromycin, Azithromycin and
 Valproic Acid.  The new products, as envisaged, have good demand in
 the domestic market and, therefore, it will not be possible for the
 unit to restrict
 itself to sell only upto 25% of the production in the domestic
 market.  The Company has therefore opted for debonding the unit,
 which gives greater flexibility to the Company to sell in the
 domestic market.
 
 The Company has received an in-principal approval from Government of
 India, Ministry of Industry, Department of Industrial Policy &
 Promotion, Secretariat for Industrial Approvals, EOU Section vide
 their letter dated 28.04.95 allowing the Company to withdraw from the
 100% Export Oriented Scheme for which industrial licence was granted
 for
 manufacture of Analgin, Furosemide and Mebendazol at Madurantakam in
 Tamilnadu.
 
 The withdrawal from 100% EOU scheme shall be subject to the following
 conditions:
 
 1. Applicable customs and excise duties shall be paid on the imported
 and indigenous capital goods, raw materials, components, consumables,
 spares & finished goods in stock.
 
 2. The penalty imposed by the Appropriate Authority under the Foreign
 Trade (Development & Regulation) Act, 1992 for non-fulfillment of
 conditions of approval, shall be paid. In case an appeal against an
 order imposing penalty is pending or proceeding under the Act have
 not been finalised, a legal undertaking for payment of penalties that
 may be imposed, would be executed with the JDG (FT) concerned.
 
 3. In case the EOU unit wishes to continue its operations as a DTA
 unit, it shall obtain necessary industrial approval in accordance
 with the Industrial Licencing provisions, inforce, and it will be
 required to comply with locational, environmental, and other rules
 and regulations
 in force, as applicable to DTA units.