Annual Report 2013-14 P R O D U C T S L I M I T E D M A N ...Registered Office & Factory Vill :...

M A N G A L A M T I M B E RP R O D U C T S L I M I T E DA n n u a l R e p o r t 2 0 1 3 - 1 4

BOARD OF DIRECTORS

SHRI N. G. KHAITAN SHRI PRABIR CHAKRAVARTI SHRI S. K. PARIK

SHRI ANAND DAGA SMT. VIDULA JALAN

TEAM OF EXECUTIVESShri Yaswant Mishra, President

Shri Tara Chand Sharma, Vice President & Manager of the Company

Shri Amit Kumar Agarwal, Chief Financial Officer

Shri Soumitrajit Samadder (Head- Marketing & Product Development)

Shri S.K.Chanda, General Manager (Works)

Miss Namrata Priya, Company Secretary

In this Annual Report, we have disclosed forward-lookinginformation to enable investors to comprehend our prospectsand take investment decisions. This report and other statements-written and oral-that we periodically make contain forward lookingstatements that set out anticipated results based on themanagement’s plan and assumptions. We have tried whereverpossible to identify such statements by using words such as‘anticipate’, ’estimate’, ’expects’, ‘projects’ , ‘intends’ , ‘plans’ ,‘believes’ , and words of similar substance in connection with anydiscussion of future performance. We cannot guarantee thatthese forward looking statements will be realised, although webelieve we have been prudent in assumptions. The achievementsof results are subject to risks, uncertainties, and even inaccurateassumptions.

Should known or unknown risks or uncertainties materialise orshould underlying assumptions prove inaccurate, actual resultscould vary materially from those anticipated, estimated, orprojected. Readers should keep this in mind. We undertake noobligation to publicly update any forward-looking statement,whether as a result of new information, future events or otherwise.

FORWARD LOOKING STATEMENTS

Registered Office & FactoryVill : Kusumi, P.O & Dist. Nabarangpur -764 059Odisha, IndiaPh : (06858) 222148/222142/222053Fax : (06858) 222042Website : www.mangalamtimber.comCIN : L02001OR1982PLC001101E-mail : [email protected]

TABLE OF CONTENTS

Notice 1-6

Director’s Report 7-10

Corporate Governance Report 11-19

Declaration by CEO, CEO & CFO Certification 20

Auditor’s Certificate 21

Auditor’s Report 22-25

Balance Sheet 26

Profit & Loss Statement 27

Notes to the Financial Statements 28-43

Cash Flow Statement 44

BankersState Bank of IndiaIDBI Bank Limited

CORPORATE INFORMATION

AuditorsS M Daga & Co.Chartered AccountantsFirm Registration Number:303119E11, Clive RowKolkata - 700 001

Registrar & Share Transfer AgentM/s C B Management Services (P) LtdP-22 Bondel RoadKolkata - 700 019

Head OfficeBirla Building, 10th Floor9/1, R N Mukherjee RoadKolkata - 700 001, West Bengal, IndiaPh : (91) (033) 22438706/07/8857Fax : (91) (033) 22438709E-mail : [email protected]

M A N G A L A M T I M B E RP R O D U C T S L I M I T E D

ANNUAL REPORT 2013-14M A N G A L A M T I M B E RP R O D U C T S L I M I T E D

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To The MembersNOTICE is hereby given that the 30th Annual General Meeting of Mangalam Timber Products Limited (CIN:L02001OR1982PLC001101) will be held on Saturday, the 16th August, 2014, at 10.00 A.M. at the Registered Office of theCompany at Vill: Kusumi, P.O. & Dist. Nabarangpur, Odisha - 764059 to transact the following business:Ordinary Business1. To receive, consider and adopt the audited financial statement of the Company for the financial year ended 31st

March, 2014 and the Reports of the Directors and Auditors thereon.2. To appoint a Director in place of Smt. Vidula Jalan (DIN: 01474162), who retires by rotation at this Annual General

Meeting and being eligible has offered herself for re-appointment.3. To appoint auditors and to fix their remuneration and in this regard to consider and if thought fit, to pass, with or

without modification(s), the following resolution as an Ordinary Resolution.“RESOLVED THAT subject to the provisions of Section 139 and other applicable provisions of the Companies Act,2013, and the Rules made thereunder and pursuant to the recommendations of the audit committee of the Boardof Directors, M/s. S.M. Daga & Co, Chartered Accountants (Firm Registration No. 303119E), be and are herebyappointed as Auditors of the Company to hold office from the conclusion of this meeting till the conclusion of thenext Annual General Meeting of the Company at such remuneration as shall be fixed by the Board of Directors ofthe Company.”

Special Business4. To appoint Shri N.G.Khaitan (DIN: 00020588) as an Independent Director and in this regard to consider and if thought

fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution.“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicableprovisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014(including any statutory modification(s) or re-enactment thereof for the time being in force), Shri N.G.Khaitan (DIN:00020588), Director of the Company, whose period of office is liable to determination by retirement of directors byrotation, be and is hereby appointed as an Independent Director of the Company for a term of five consecutive yearsfrom the conclusion of the Company’s 30th Annual General Meeting to the conclusion of Company’s 35th AnnualGeneral Meeting.”

5. To appoint Shri Prabir Chakravarti(DIN: 00273523)as an Independent Director and in this regard to consider and ifthought fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution.“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicableprovisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014(including any statutory modification(s) or re-enactment thereof for the time being in force), Shri Prabir Chakravarti(DIN: 00273523), Director of the Company, whose period of office is liable to determination by retirement of directorsby rotation, be and is hereby appointed as an Independent Director of the Company for a term of five consecutiveyears from the conclusion of the Company’s 30th Annual General Meeting to the conclusion of Company’s 35thAnnual General Meeting.”

6. To appoint Shri S.K.Parik (DIN: 00055800) as an Independent Director and in this regard to consider and if thoughtfit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution.“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicableprovisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014(including any statutory modification(s) or re-enactment thereof for the time being in force), Shri S.K. Parik (DIN:00055800), Director of the Company, whose period of office is liable to determination by retirement of directors byrotation, be and is hereby appointed as an Independent Director of the Company for a term of five consecutive yearsfrom the conclusion of the Company’s 30th Annual General Meeting to the conclusion of Company’s 35th AnnualGeneral Meeting.”

NOTICE

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Registered Office: By Order of the Board of DirectorsVill : Kusumi, P.O. & Dist. NabarangpurOdisha-764059, IndiaCIN : L02001OR1982PLC001101Website : www.mangalamtimber.comEmail : [email protected] No : +91 6858 222148/142/053Fax : +91 6858 222 042

Dated: 14th May, 2014 NAMRATA PRIYAPlace : Kolkata COMPANY SECRETARY

NOTICE (Contd.)7. To appoint Shri Anand Daga (DIN: 00897988) as an Independent Director and in this regard to consider and if thought

fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution.“RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152 read with Schedule IV and all other applicableprovisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014(including any statutory modification(s) or re-enactment thereof for the time being in force), Shri Anand Daga (DIN:00897988), Director of the Company, whose period of office is liable to determination by retirement of directors byrotation, be and is hereby appointed as an Independent Director of the Company for a term of five consecutive yearsfrom the conclusion of the Company’s 30th Annual General Meeting to the conclusion of Company’s 35th AnnualGeneral Meeting.”

8. To consider and if thought fit, to pass with or without modification(s), the following resolution as a Special Resolution.“RESOLVED THAT pursuant to the provisions of Section 196, 197, 203 read with Schedule V and all other applicableprovisions of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel)Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and subjectto approval by shareholders of the Company, the Board hereby approves the appointment of Shri Tara Chand Sharma,as Manager of the Company, for a period of 3 (three) consecutive years with effect from 14th May, 2014 in termsof the said Act, upon terms and conditions as recommended by the Nomination & Remuneration Committee andset out in the Explanatory Statement annexed hereto the Notice calling the Annual General Meeting.”

NOTES

1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THEANNUAL GENERAL MEETING (THE “MEETING”) IS ENTITLEDTO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OFHIMSELF AND SUCH PROXY NEED NOT BE A MEMBER OFTHE COMPANY. The instrument appointing the proxy should,however, be deposited at the registered office of theCompany not less than forty-eight hours before thecommencement of the Meeting.Proxies submitted on behalf of companies, societies, etc.must be supported by an appropriate resolution/authority,as applicable. A person shall not act as a Proxy for morethan 50 members and holding in the aggregate not morethan ten percent of the total voting share capital of theCompany. However, a single person may act as a proxy fora member holding more than ten percent of the total votingshare capital of the Company provided that such personshall not act as a proxy for any other person.

2. Explanatory Statement pursuant to Section 102 of theCompanies Act, 2013, in respect of the Special Businesses

to be transacted at the Annual General Meeting as set outin the Notice is annexed hereto.

3. The Register of Members and Share Transfer Books of theCompany will remain closed from 12th August, 2014 to 16thAugust, 2014 (both days inclusive).

4. Members are informed that the scrips of the Company havebeen activated both in CDSL and NSDL and may bedematerialised under the ISIN No: INE805B01012.

5. Members, who have not so far encashed dividend warrantsfor the financial year ended 31st March, 2008 and 31stMarch, 2009 are requested to seek issue of duplicatewarrants by writing to the Company’s Registrars and TransferAgents, M/s, C. B. Management Services (P) Ltd. Membersmay note that pursuant to Sec.124(5) any money, whichremains unpaid or unclaimed for a period of seven yearsfrom the date of transfer to the unpaid dividend account ofthe Company, should be transferred by the company to theInvestor Education and Protection Fund (“IEPF”) and noclaim should lie against the IEPF or the Company thereafter.

The Ministry of Corporate Affairs (MCA) on 10th May, 2012notified the IEPF (Uploading of information regarding unpaidand unclaimed amounts lying with Companies) Rules, 2012(IEPF Rules), which is applicable to the Company. Theobjective of the IEPF Rules is to help the shareholdersascertain status of the unclaimed amounts and overcomethe problems due to misplacement of intimation thereofby post etc. In terms of the said IEPF Rules, the Company hasuploaded the information in respect of the Unclaimed Dividendsin respect of the financial years 2007-08 & 2008-09, as on thedate of the 29th Annual General Meeting (AGM) held on 17thAugust, 2013, under “Investors Section” on the Website ofthe Company viz.www.mangalamtimber.com.

6. In terms of provisions of Section 72 of the Companies Act,2013, nomination facility is available to individualshareholders. The shareholders who are holding shares inphysical form and are desirous of availing this facility maykindly write to the Company’s Share Transfer Agents, M/s.C.B. Management Services (P) Ltd., P-22 Bondel Road, Kolkata-700 019 for nomination form quoting their folio number.Shareholders holding shares in dematerialized form shouldwrite to their Depository Participant for the purpose.

7. Members who are holding shares in identical order of namesin more than one folio, are requested to write to theCompany‘s Share Transfer Agents at the address mentionedhereinabove in Note 6 to consolidate their holding in onefolio.

8. Members who are holding shares in physical form arerequested to notify change in address, if any, to theCompany’s Share Transfer Agents at the address mentionedhereinabove in Note 6 quoting their folio number.Shareholders holding shares in dematerialized form, shouldintimate change of their address, if any, to the Depositoryparticipant.

9. The Securities and Exchange Board of India (SEBI) hasmandated the submission of Permanent Account Number(PAN) by every participant in securities market. Membersholding shares in electronic form are, therefore requestedto submit the PAN to their Depository Participant with whomthey are maintaining their demat accounts. Members holdingshares in physical form can submit their PAN details to theCompany’s Registrar and Share Transfer Agent.

10. Members may also note that the Notice of the 30th AnnualGeneral Meeting and the Annual Report for the year ended31st March, 2014 will also be available on the Company’swebsite www.mangalamtimber.com for their download. Thephysical copies of the aforesaid documents will also be availableat the Company’s Registered Office for inspection duringnormal business hours on working days. Even after registeringfor e-communication, members are entitled to receive suchcommunication in physical form, upon making a request forthe same, by post free of cost. For any communication, theshareholders may also send requests to the Company’s investoremail id: [email protected]

11. Brief profile of Smt. Vidula Jalan, Director retiring by rotation :Smt. Vidula Jalan[DIN:01474162], aged 34 years, is MBA inStrategic Marketing, Leadership and Change Managementfrom the Indian School of Business, Hyderabad. Moreover,she also has an Accounting and Finance degree from TheUniversity of Manchester, U.K. She is also managing theaffairs of reputed schools and charitable trusts of the B. K.Birla Group (the “Group”). She joined the board of MangalamTimber Products Ltd. on 29th June, 2005. She also holdsDirectorship in Vidula Consultancy Services Limited andMangalam Cement Limited.She holds 1,03,527 shares ofthe Company.

12. As per Section 108 of the Companies Act, 2013, read withRule 20 of the Companies (Management and Administration)Rules, 2014, the items of business set out in the attachedNotice may be transacted also through electronic votingsystem as an alternative mode of voting. The Company isproviding the facility of casting votes through the electronicvoting system (“e-Voting”) under an arrangement with TheNational Securities Depository Limited (“NSDL”) as specifiedmore fully in the instructions hereunder provided that oncethe vote on a Resolution is cast, a Member shall not beallowed to change it subsequently.The Notice of the Meetingwill also be available on the Company’s websitehttp:/www.mangalamtimber.com and the website of TheNational Securities Depository Limited (“NSDL”) athttp:/www.evoting.nsdl.com. Voting shall be reckoned inrelation to a Member’s holding of the Paid-up Equity ShareCapital of the Company as at close of business on 4th July,2014 (“Cut-off Date”).

13. For those Members opting for e-Voting, the process andmanner of e-Voting will be as follows:A. For Members receiving information electronically: -

i. Please read the e-mail carefully and open theattached PDF file specifying your Client ID (in caseshares held in demat form) and folio no. (in caseshares held in physical mode) as default password.The attachment contains your “User Id” and“Password” for e-Voting. Please note that thepassword is an initial password.

ii. Launch the Internet Browser by typinghttp:/www.evoting.nsdl.com on the address bar.The home screen will be displayed, select theMember “login” name. Enter the login details viz.User Id and password sent to you by email/post.On the first login, you need to change the password.In case you have earl ier logged in atwww.evoting.nsdl.com for exercising your vote inrespect of a Ballot relating to any other Companyand you have already changed your password, pleaseuse the changed password. It is stronglyrecommended not to share your password with anyother person and take utmost care to keep yourpassword confidential.

iii. On successful login, you have to select the “EVEN”(E-Voting Event Number) for casting your vote.

NOTES (Contd.)


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iv. Cast your vote by selecting appropriate option andclick on “submit” and also “confirm” whenprompted. Upon confirmation, the message “votecast successfully” will be displayed. Once you havevoted on the resolution, you will not be allowed tomodify your vote.

v. E-Voting period commences at 10 a.m. on Sunday,the 10th August, 2014 and ends on Tuesday, the12th August, 2014 at 6:00 p.m. During the e-Votingperiod, Members of the Company holding shareseither in physical form or in dematerialized form,as on the cut-off date, may cast their voteelectronically. At the end of the e-Voting period,the portal where the votes are cast shall forthwithbe blocked by NSDL.

vi. In case of any query, you may refer to the frequentlyasked questions (FAQ) for members and e-Votinguser manual for shareholders available at the“downloads” section of www.evoting.nsdl.com orcontact them on their telephone 022-24994600.

vii. You can also update your mobile number and e-mail id in the user profile details of the folio whichmay be used for sending communication(s) regardingNSDL e-Voting system in future.

B. The instructions for e-Voting for Members other thanin (A) aboveInitial “User Id” and “Password” are provided in theattendance slip for the AGM with the Notice. Pleasefollow the steps (ii) to (vii) stated above to cast yourvote through e-voting.

14. Any query relating to the Resolutions and e-Voting proposedto be passed at the ensuing Annual General Meeting(AGM)may be addressed to the Company Secretary of the Company.

15. Voting can be exercised only by the concerned Member orhis/her duly constituted attorney or, in case of bodiescorporate, its duly authorised person. A Member need notuse all his/her votes.

16. The results of the voting shall be placed on the website ofthe Company and on the website of the NSDL within twodays of passing of the Resolutions at the AGM andcommunicated to the Stock Exchanges where the Company’sshares are listed. The results of the voting process will alsobe displayed on the Company’s website www.mangalamtimber.com

17. The Company has appointed Roshan Agarwal (MembershipNo. 404539), Practicing Chartered Accountant, as a Scrutinizerfor conducting the entire polling process (including e-Voting)in a fair and transparent manner.

18. The Scrutinizer shall not later than three (3) working daysfrom the conclusion of the e-voting period, unblock the votesand submit his Report on the voting pattern in accordancewith the procedure set out in Companies (Management &Administration) Rules, 2014.

19. The Results shall be declared at the AGM. The results declaredtogether with the Scrutinizer’s Report shall be placed on theCompany’s website www.mangalamtimber.com and on thewebsite of NSDL within two (2) days of passing of theResolutions and communicated to the Stock Exchange.

20. Pursuant to Companies (Cost Records and Audit) Rules, 2014issued by Ministry of Corporate Affairs on 30th June, 2014,the Company does not fall within the purview of maintenancecost records and their audit.Hence, the Company has notput up the resolution for approval of remuneration of costauditor for the financial year 2014-15.

NOTES (Contd.)

ANNEXURE TO THE NOTICEEXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013 (“THE ACT”)ITEM NO. 4 to 7Pursuant to the provisions of Sections 149, 150, 152 read withSchedule IV and all other applicable provisions of the CompaniesAct, 2013 and the Companies (Appointment and Qualification ofDirectors) Rules, 2014 and Clause 49 of the Listing Agreement, itis proposed to appoint Shri N.G.Khaitan,Shri Prabir Chakravarti,Shri S.K.Parik and Shri Anand Daga as Independent Directors ofthe Company for the period of 5 (Five) consecutive years fromthe conclusion of the Company’s 30th Annual General Meetingto the conclusion of Company’s 35th Annual General Meeting.The Company has received notices in writing under Section 160of the Companies Act, 2013 from members along with the requisitedeposits proposing the candidatures of each of the appointeesfor the office of Director of the Company.Further none of them are disqualified from being appointed asDirectors in terms of Section 164 of the Companies Act, 2013 andhave given their consent to act as Directors.In the opinion of the Board, the Independent Directors fulfill theconditions specified in Sections 149, 152 and Schedule IV of theCompanies Act, 2013 read with Companies (Appointment and

Qualifications of Directors) Rules, 2013 (including any statutorymodification(s) or re-enactment thereof for the time being inforce) and such Independent Directors are independent of themanagement. Further, all the aforesaid Independent Directorshave given a declaration to the Board of Directors to the effectthat they meet the criteria of independence as provided in Section149(6) of the Companies Act, 2013.

A brief profile along with other details of the IndependentDirectors are as follows:a) Shri N G Khaitan (DIN 00020588) is a Senior Partner of

Khaitan & Co. based in Kolkata. He passed his Attorney-ship Examination from the Calcutta High Court in theyear 1974 and stood first in the Preliminary, Intermediateand Final Examinations and was awarded Bell Chamber'sGold Medal by the Incorporated Law Society, High Court,Calcutta. He is a Notary Public appointed by the Govt. ofIndia.He has rich experience in all aspects of laws andmore particularly, Real Estate, Corporate laws and hashandled important Litigations covering different branchesof laws including Mergers & Acquisition, Restructuring

and De-mergers. He has advised several large industrialhouses and multinational corporations on multifarious legalmatters. He has also been a lead speaker in differentseminars and symposiums on varied legal issues.He is aCommittee member of the Federation of Indian Chambersof Commerce and Industry, New Delhi; President, IndianCouncil of Arbitration, New Delhi; Vice- President of BharatChamber of Commerce, Executive Committee member ofThe Agri-Horticultural Society of India, Executive Committeemember of a leading school in Kolkata and had beenPresident of two leading Social Clubs in Kolkata.He hasdirectorship and committee membership in followingcompanies: Chase Bright Steel Ltd.; HSIL Ltd. Member -Audit Committee & Chairman- Shareholder/InvestorGrievance Committee; J K Lakshmi Cement Ltd. Member- Audit Committee and Shareholder/Investor GrievanceCommittee; Mangalam Cement Ltd. Member - AuditCommittee; Naga Dhunseri Group Ltd.; Reliance ChemotexInds. Ltd. Member – Audit Committee; Rasoi Ltd; IndiaPower Corpn Ltd. Member – Audit Committee; Warren TeaLimited. He is a director in the Company since 29th January,1985 and does not hold any shares of the Company.

b) Shri Prabir Chakravarti (DIN 00273523) is BA (Hon’s), MA(Economics), L.L.B (Calcutta University) and MBA fromQueens University, Belfast, U.K. He has vast experience inTextile Business. He has been a Past President of All IndiaOrganization of Employers, New Delhi (1995-96), BharatChamber of Commerce (1993-94), Calcutta Club Ltd (1996)and Rotary Club of Calcutta (1994-95). He has been PastDistrict Governor of Rotary International District 3920(2004-2005). He has been a member of the State LabourStanding Committee, West Bengal, Sikkim and AndamanNicobar Islands. Presently he is a member of the Board ofGovernor, Institute of Business Management & SocialWelfare (Calcutta University).He is a Rotarian since 1972of Rotary Club of Calcutta. He has directorship andCommittee membership in following Companies: BaghmariTea Company Ltd. Nicco Financial Services Ltd.; RelianceJute Mills (International) Ltd.; Vidula Consultancy ServicesLtd.; BNK Capital Markets Ltd. Member – Audit Committee;Nicco Corporation Ltd. Member – Audit Committee;Jayshree Chemicals Ltd. Member – Audit Committee; SriGirija Prasanana Cotton Mills Ltd. He is a director in theCompany since 15th May, 2009 and does not hold anyshares of the Company.

c) Shri S. K. Parik (DIN 00055800) is a Fellow Member of theInstitute of Chartered Accountants of India and also of theInstitute of Company Secretaries of India, having vastexperience in the field of Finance, Taxation, Company Lawand other related matters. He is a director in Hada TextilesIndustries Ltd. He is director in the Company since 6thJune, 1996 and does not hold any shares of the Company.

d) Shri Anand Daga (DIN 00897988) is B.Com from St. Xavier’sCollege, Kolkata. He has done various courses on FinancialPlanning. He has been actively involved in the familybusiness and also provides financial consultancy to variousCompanies. He does not hold directorship in any otherCompany. He is director in the Company since 8th

December, 2010 and does not hold any shares of theCompany.

Note: Directorships and Committee memberships in MangalamTimber Products Limited and its Committees are not includedin the aforesaid disclosure. Committee positions only of AuditCommittee and Shareholders’/Investors’ Grievance Committeein Public Companies have been considered. Also, alternatedirectorship, directorships in Private Limited Companies, ForeignCompanies and Section 8 companies and their Committeememberships are excluded.Other than the Independent Directors of the Company andtheir relatives, none of the Directors, Key Managerial Personnelor their relatives are concerned or interested in the proposedOrdinary Resolutions as set out in Item Nos. 4 to 7 of thisNotice.ITEM NO. 8.Upon resignation of Shri Ramesh Chander Singh, Manager ofthe Company, the Board has accorded its approval toappointment of Shri Tara Chand Sharma as Manager of theCompany for a period of three (3) consecutive yearscommencingfrom 14th May, 2014 to 13th May, 2017.The Board also approved the terms and conditions of hisappointment including remuneration, as recommended by theNomination and Remuneration Committee, in accordance withthe provisions of Sections 196, 197, 203, Schedule V and otherapplicable provisions, if any, of the Companies Act, 2013 readwith Companies (Appointment and Remuneration of ManagerialPersonnel) Rules, 2014 (including any statutory modification(s)or re-enactment thereof, for the time being in force), subjectto the approval of the shareholders at the ensuing AnnualGeneral Meeting.For the year ended 31st March, 2014 the Company has incurreda net loss. Whilst the Company has already initiated steps toturn around the situation, due to external factors (such asgeneral economic slowdown coupled with increasing rawmaterial costs, power and fuel and freight costs), it may takesometime till th e situation completely changes. Consequently,out of abundant caution and in view of the relevant extantprovisions of law relating to managerial remuneration, theCompany is complying with the provisions of Section II of PartII of Schedule V to the Companies Act, 2013.None of the Directors of the Company, except Shri Tara ChandSharma, is in any way concerned or interested in this resolution.The specified information while seeking approval/consent ofshareholders as required under Schedule V is listed outhereinbelow:I. General Information:

1. Nature of Industry: Medium Density Fibreboard2. Date or expected date of commencement of

commercial production: 11th November, 1987.3. In case of new companies, the expected date of

commencement of the activities as per projectapproved by the financial appearing in the prospectus:Not applicable.

4. Financial Performance based on given indicators:

ANNEXURE TO THE NOTICE (Contd.)EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013 (“THE ACT”)


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5. Export performance and net foreign exchangecollaborations: Not applicable.

6. Foreign Investments or collaborators, if any: Notapplicable.

II. Information about the Appointee:Shri Tara Chand Sharma, aged 61, is a B.Com from theUniversity of Rajasthan. He has worked with companies likeHindustan Wire Limited and Ambika Jute Mills Limited invarious capacities. His areas of expertise include accounts,finance & commercial.The appointment of Shri Tara Chand Sharma as the Managerof the Company shall be subject to the supervision andcontrol of the Board of Directors of the Company. He shallmanage the business and substantially the whole of theaffairs of the Company and exercise such powers as arevested by the Board of Directors subject to any limitationor conditions which may be prescribed by the Act or theprovisions of Memorandum and/or Articles of Associationof the Company or the Board of Directors or by the Companyin General Meeting.

Remuneration Proposed :

Notwithstanding anything herein contained, where in any financialyear during the period of his office as Manager of the Company,the Company has no profits or its profits are inadequate, theCompany may, subject to the requisite approvals, pay Shri TaraChand Sharma remuneration by way of salary, allowances,perquisites not exceeding the maximum limits laid down in SectionII of Part II of Schedule V to the Companies Act, 2013.Remuneration of Manager in the industry in general has gone upmanifold in past few years. The remuneration in the industry fora person of the same caliber / position of Shri Tara Chand Sharmamay generally be higher than what is being paid to him.Besides the remuneration proposed, Shri Tara Chand Sharma doesnot have any pecuniary relationship with the Company. There areno managerial personnel related to Shri Tara Chand SharmaThis may be treated as an abstract of the terms and conditionsgoverning the appointment and payment of remuneration of ShriTara Chand Sharma pursuant to Section 190 of Companies Act,2013.III. OTHER INFORMATION

Reasons of loss or inadequate profits:Factors such as general economic slowdown, political unrestin few of our market and consequent adverse marketconditions coupled with ever increasing raw material prices,power & fuel and transportation costs have severally affectedthe margins for products manufactured by the Company.Further, with the suspension of operation in plant, on accountof major repair and maintenance of age’s old plant andmachineries production for the year has been significantlydiminished. This has been undertaken to ensure smoothproduction in ensuing period.Steps taken or proposed to be taken for improvementThe Company has initiated certain steps such as cost control,strategic marketing positioning of brand and product andimproving efficiency etc. Though, the prices of raw materialsand fuels are influenced by external factors the Companyis making all possible efforts to improve the margins.Expected increase in productivity and profits in measurabletermsThe Company is very conscious about improvement inproductivity and undertakes constant measures to improveit. However, it is extremely difficult in the present scenarioto predict performance in measurable terms.

ANNEXURE TO THE NOTICE (Contd.)EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013 (“THE ACT”)

Particulars Financial FinancialYear Ended Year Ended31.03.2014 31.03.2013

Gross Sales and Other Income 6655.12 9160.73Operating Profit (PBIDT) (590.75) 81.57Profit before Depreciation & Tax (PBDT) (871.23) (364.46)Profit after Tax (PAT) (761.69) (354.78)

(Rs. in Lacs)

Particulars Amount(Rs.)Salary 10,000/- per monthHRA 3,000/- per monthManagerial/Other allowances As per rules of the CompanyMedical/LTA/Insurance As per rules of the CompanyBonus/Exgratia As per rules of the CompanyProvident Fund, SuperannuationFund & Gratuity As per rules of the CompanyMiscellaneous Reimbursement Reimbursement of expenses of

Mobile Phone/Broad-band/ Data Card used for the company’s business shall not be considered as perquisite

Registered Office: By Order of the Board of DirectorsVill : Kusumi, P.O. & Dist. NabarangpurOdisha-764059, IndiaCIN : L02001OR1982PLC001101Website : www.mangalamtimber.comEmail : [email protected] No : +91 6858 222148/142/053Fax : +91 6858 222 042

Dated: 14th May, 2014 NAMRATA PRIYAPlace : Kolkata COMPANY SECRETARY

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Dear Members,Your Directors are pleased to present the 30th Annual Report of the Company and the Audited Accounts for the financial yearended 31st March, 2014.

DIVIDENDIn view of losses, the Board of Directors has not recommended any dividend for the financial year 2013-2014.

OPERATIONAL PERFORMANCE

As the plant has become old, major maintenance of the plant andmachineries has been undertaken during the year in three phasesfor smooth production. As a result production got reduced duringthe year to 16615 MT as compared to 31410 MT in the previousyear. Further profitability for the year has been impacted adverselydue to considerable increase in raw material prices, power & fueland transportation costs.

Moreover, due to political unrest in Seemandhra procurement ofraw materials as well as despatches were impacted considerably.

During the year gross sales have reduced to Rs. 6268.64 Lacs ascompared to Rs.9106.23 Lacs in the previous year whereas duringthe Q4FY14 the Company has earned a profit after tax of Rs. 91.22Lacs as against Rs. 68.06 Lacs in corresponding period of previousyear.

The Company is continuing its efforts to achieve better results inthe years to come on all fronts like reduction of operational cost(s);strategic marketing positioning of brand and product etc.

RAW MATERIAL

Raw material costs especially firewood and resins have increased

substantially and have affected profitability during the year. Otherraw materials also have shown an upward trend in prices.

PLANTATION

Availability of firewood in nearby areas has become difficult butnecessary efforts are being made continuously to develop longterm supply. Your Company is continuing its policy on plantationactivities to help supply quality raw material to factory with leastcost on a continual & sustainable basis. Some important effortsundertaken during the year are mentioned below:

Mist Chamber and Nursery: Company is strategically increasingthe focus on Nursery operation to ensure consistent & qualitysupply of high yielding clonal plants to the farmers at affordableprice and to increase the catchment areas of Company for wood.The new mist chamber, which started operating in Q4FY13,together with modifications in existing chambers enabled us toincrease the production capacity of the nursery to 3.00 millionclonal plants.

During 2013-14 we have already provided 1.20 million clonalplants collectively to farmers of Jeypore & Koraput forest Divisionsand other local farmers near the Plant.

FINANCIAL RESULTThe Company’s financial performance for the year ended 31st March, 2014 is summarized below :

(Rs. in lacs)

Net Sales / Income from operations 5,595.15 8,075.91Operating Profit before Interest, (590.75) 81.57Finance Charges, Depreciation and TaxLess: Interest and Finance Charges 280.48 446.03Gross Profit/(Loss) before Depreciation and Tax (871.23) (364.46)Less: Depreciation 184.55 171.47Profit/(Loss) before Tax (1,055.78) (535.93)Add : Deferred Tax (Net) 294.09 181.15Net Profit/(Loss) after Tax (761.69) (354.78)Profit/(Loss) brought forward from previous year (834.74) (479.96)Balance carried forward to next year (1,596.43) (834.74)

For the Year ended31st March, 2014

For the Year ended31st March, 2013Particulars

DIRECTORS’ REPORT & MANAGEMENT DISCUSSION

8

Farm Forestry Planting: Odisha forest department has invited thewood based industry to participate in a farm forestry schemeunder “Odisha Forestry Sector Development Project” whereinindustry will supply good quality clonal planting material to smalland marginal farmers with wood buyback arrangement. Thescheme provides scope for the farmer to achieve higher returnsfrom his/her land. During year we have entered into a newTRIPARTITE AGREEMENT between Company and farmer on buyback basis. By this scheme we are supplying 0.30 million clonalplants to farmers. The scheme provides scope for industry toprocure good quality raw material and increase the availability ofwood near Nabarangpur catchments area of Company as itencourages the small farmer to plant his small piece of land forwood.Lease area Replanting: We are gradually increasing the area underplantation and by 2015-16 entire lease area will have high yieldingclonal plants, which would supply approx. 15% to 20% annualrequirement of our plant from 2016 onwards.Private Wood supply: Presently approx. 10% of our woodrequirement comes from farm forestry and lease plantations. Infuture we can fulfill up to 15%-20% of the Company woodrequirement from our lease land and balance requirement fromprivate suppliers. All efforts are being made to increase the captivewood supply. However, efficient vendor development is essentialfor long-term consistent supply of quality wood.INDUSTRY SCENARIO:MDF has grown in acceptance over the years since its introductionin the mid-80s & is product that is now home to the modular –machined furniture industry coupled with niche applications inShoe heels, handicraft items & berth cushion base in railwaycoaches to name a few. With exposure of the Indian populace toglobal life styles, demands for such modular panels due to itseconomic angle, lends scope of periodic sprucing up of the interiorswithout the worry & the inhibition of cost over runs. In the Indiancontext MDF boards are increasingly finding preference in household segment in the domestic furniture segments with modularkitchens taking a lead followed by the new age modular bedroomsets & wall mounted TV cabinets. While on the flip side theCorporate India had graduated to the international ergo-trendsin modern workspaces MDF was a staple input in it modularfurniture products machined through state-of-art automatedplants. Such is the demand that leading global kitchen brands likeAlno, Pogh Polh, Hacker has set up shop/integration units in Indiatoo apart from the larger volume imports from China, Malaysia& even Bangladesh have found major preference with the IndianHomes. With more production of modular furniture for household segment in India the demand for pre-laminated boards islikely to surge in near future.MARKETING & SALESThe Company with the Duratuff Range of Plain & PrelaminatedMDF Boards aims at meeting the increased demand in the countrywith product variants such as that addresses the unique needs ofthe modern customer.

The Company with an established pan-India presence since thelate-80s has a dedicated channel network nationally. To maximizeon market penetration the Company has strategic marketpositioning which are closer to the factory to minimise onoverheads & push the product at the best realization despitemaintaining strong market presence in the Indian Market.The marketing strategies are backed by a dedicated & motivatedmarketing team with minimal attrition rate to push brand Duratuffin the Indian market place.Over the years brand Duratuff has been the preferred brand ofMDF as a key OEM fitment in leading modular furnituremanufacturers in the country. The brand’s presence in the Indianmarket place over the past three decades has created a marketstrong hold despite other new domestic competitors & the everpresent threat of imports.INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACYYour Company has an adequate system of internal controlprocedures which is commensurate with the size and nature ofbusiness. The internal control systems of the Company aremonitored and evaluated by internal auditors and their auditreports are periodically reviewed by the Audit Committee of theBoard of Directors. The observations and comments of the AuditCommittee are placed before the Board.CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTIONThe management is giving top priority to energy conservation andconservation of resources. Continuous efforts are being madetowards optimisation of operational efficiency in powerconsumption. Lower electricity consumption is achieved throughcontrol of ideal machine hours and optimised power factor.FORM ‘A’ of the Companies (Disclosure of particulars in the Reportof Board of Directors) Rules, 1988 is not required to be filled asour industry is not included in the Schedule to the Rules.FOREIGN EXCHANGE EARNINGS AND OUTGOThere has been no foreign exchange earnings during the year.However the total expenditure on foreign exchange during theyear was equivalent to Rs.146.39 Lacs on account of imports ofraw materials and stores & spares.PUBLIC DEPOSITSThe Company has neither invited nor accepted any deposits fromthe public within the meaning of Section 58(A) of the CompaniesAct, 1956 during the year under review. As such, no amount ofprincipal or interest was outstanding on the date of the BalanceSheet.LISTING WITH THE STOCK EXCHANGESThe Company is listed with the National Stock Exchange of IndiaLimited and Bombay Stock Exchange Limited. The annual listingfee to both the stock exchanges has been duly paid on time.


9

DEMATERIALIZATION OF THE SHARES OF THE COMPANYTrading in shares of the Company has been compulsorily indematerialized mode by all investors as per directives given bySEBI. Accordingly, the equity shares of the Company are availablefor dematerialization under ISIN INE 805B01012 with CDSL andNSDL.DIRECTORSSmt. Vidula Jalan, being non independent director, retires byrotation in the ensuing Annual General Meeting and being eligible,offers herself for re-election.Pursuant to the provisions of Sections 149, 150, 152 read withSchedule IV and all other applicable provisions of the CompaniesAct, 2013 and the Companies (Appointment and Qualification ofDirectors) Rules, 2014 and Clause 49 of the Listing Agreement, itis proposed to appoint Shri N. G. Khaitan, Shri Prabir Chakravarti,Shri S. K. Parik and Shri Anand Daga as Independent Directors ofthe Company for the period of 5 (Five) consecutive years fromthe conclusion of the Company’s 30th Annual General Meetingto the conclusion of Company’s 35th Annual General Meeting.The Company has received declarations from all the IndependentDirectors of the Company confirming that they meet with thecriteria of independence as prescribed both under sub-section(6) of Section 149 of the Companies Act, 2013 and under Clause49 of the Listing Agreement with the Stock Exchanges.AUDITORS’ REPORTAuditors’ Report to the shareholders does not contain anyqualification, reservation, or adverse remarks and are selfexplanatory.STATUTORY AUDITORSM/s. S M Daga & Co., Chartered Accountants (Firm RegistrationNo. 303119E), statutory auditors of the company is due forretirement in accordance with provisions of the Companies Act,1956 at the ensuing Annual General Meeting and are eligible forreappointment. Your Directors recommend their appointment forthe ensuing year.The Company has received letters from them to the effect thattheir re-appointment, if made, would be within the prescribedlimits under Section 141(3)(g) of the Companies Act, 2013 andthat they are not disqualified for re-appointment.COST AUDITPursuant to the directives of the Central Government under theprovision of Section 233B of the Companies Act, 1956, M/s Mani& Co, Cost Auditors, were appointed to audit the Cost records ofyour Company for the year ended 31st March, 2014.CORPORATE GOVERNANCEIn compliance with the requirements of Clause 49 of the ListingAgreement, a separate Report on Corporate Governance alongwith the Auditors Certificate on its compliance forms an integralpart of this Report.

CASH FLOW ANALYSIS

In conformity with the provisions of Clause 32 of the ListingAgreement, Cash Flow Statement for the financial year ended31st March, 2014 is annexed hereto.

FINANCE

Your Company thanks its consortium bankers for their continuedsupport.

RISK MANAGEMENT

Risk Assessment and minimisation procedures have been framedby the Company and are reviewed by the Board annually.

CARBON CREDIT

Our Clean Development Mechanism (CDM) project activity“Reforestation of degraded land by MTPL in India (5016)” hasachieved another milestone during the year with receipt ofconfirmation of credit of 1764076 tCERs to the Company fromUNFCCC. These units will be available to the Company oncompletion of certain laid formalities.

OPPORTUNITIES

Plywood is popular amongst the housing industry while MDF hasgained approval in the large commercial space. The housing marketbeing much larger, plywood holds a significant market share. Thereis a perception of Plywood being more durable and the skillrequired to use plywood is lower. But with increasing awarenessand approval of MDF and Particle boards, the trend has startedchanging resulting into increase in share of such items in totalrequirements of boards.

Since the early-90s imports had begun into India & have beengrowing year on year. The import figures over the years give theclear indication as to yawning gap between demand & supply ofMDF.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of theCompanies Act, 1956, with respect to Directors’ ResponsibilityStatement, it is hereby confirmed that:

(i) in preparation of the annual accounts for the year ended31st March, 2014, the applicable accounting standards readwith requirements set out under Schedule VI to theCompanies Act, 1956, have been followed and that nomaterial departure has been made therefrom;

(ii) the Directors have selected such accounting policies andapplied them consistently and made judgments and estimatesthat are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company for the financialyear ended 31st March, 2014 and of the loss of the Companyfor that year ended on that date;

10

(iii) the Directors have taken proper and sufficient care formaintenance of adequate accounting records in accordancewith the provisions of the Companies Act, 1956 forsafeguarding the assets of the Company and for preventingand detecting fraud and other irregularities; and

(iv) the Directors have prepared the annual accounts of theCompany on a “going concern” basis.

HUMAN RESOURCESYour Company believes that the competence and commitment ofthe people are the principle drivers which enables the enterpriseto create and deliver value. The industrial relations climate ofyour Company continues to remain harmonious with focus onimproving productivity, quality and safety. Efforts are being madeto strengthen organizational culture in order to attract and retainthe good talent in the industry. The Board records its appreciationof the commitment and support of the employees and looksforward to their continued support.PERSONNELThe Company has no employee in respect of whom informationunder Section 217 (2A) of the Companies Act, 1956 is required tobe annexed.

CORPORATE SOCIAL RESPONSIBILTY:

As a part of corporate social responsibility activities, your Companyaims at creating sustainable livelihood capabilities and increasingthe level of prosperity of the local community. Your Company hasundertaken measures for providing health and education facilities,infrastructure support to the local community and other welfareactivities.

To promote cultural harmony among people, your Companyregularly supports various religious and social programmes. Furtherduring the year under review, your Company has provided aquaguard facility at the local school for availability of clear drinkingwater to students, made donation to the Red Cross Society andprovided financial aid to the needy students of the local community.

ACKNOWLEDGEMENT

Your Directors take this opportunity to place on record their deepappreciation for the whole-hearted and sincere co-operation thecompany has received from the statutory authorities, banks,shareholders and customers.

Your Directors also wish to thank all their employees for theirdedicated and committed service to the company.

Dated : 14th May, 2014Place : Kolkata

N G KhaitanPrabir ChakravartiAnand DagaVidula Jalan

Directors


11

The Corporate Governance Report in compliance with the Corporate Governance required as per clause 49 of the Listing Agreementwith the Stock Exchanges is set out hereunder :-

I. COMPANY’S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE:The Company always endeavours to follow the principles of good Corporate Governance and tends to achieve transparent,accountable and fair management.II. BOARD OF DIRECTORS(A) COMPOSITION OF BOARD

As on 31st March, 2014, the Board comprised of five Directors, out of which four are Non-Executive Independent Directors.The Non-Executive Directors are eminent professionals with experience in finance, law and public enterprises. The compositionof the Board during the year ended 31st March, 2014 is given hereunder:-

(B) OTHER PROVISIONS AS TO BOARD AND COMMITTEES(i) DETAILS OF OTHER DIRECTORSHIPS:

The details of Directorships in other companies (excluding Private Limited Companies and Companies under Section25 of the Companies Act, 1956), Chairmanship and Committee Membership (Audit Committee and ShareholdersGrievance Committee) held by the Directors are given below :

Name of Directors No. of otherDirectorship

excluding M.T.P.L.

No. of Chairmanshipof the Board

excluding M.T.P.L.

No. of Board Committee ofwhich he/she is a member

including M.T.P.L.

No. of Board Committee ofwhich he/she is a Chairman

including M.T.P.L.

Shri N G Khaitan 9 Nil 8 2

Shri Prabir Chakravarti 8 Nil 5 Nil

Shri S K Parik 1 Nil 2 1

Shri Anand Daga Nil Nil Nil Nil

Smt Vidula Jalan 2 Nil Nil Nil

CORPORATE GOVERNANCE REPORT

Sl.No.

Name of Directors Category of Directors No. ofBoard Meetings

held

No. ofBoard Meetings

attended

WhetherLast AGMattended

(1) (2) (3) (4) (5) (6)

1. Shri N G Khaitan Independent Non-Executive 4 4 No

2. Shri Prabir Chakravarti Independent Non-Executive 4 4 Yes

3. Shri S K Parik Independent Non-Executive 4 4 No

4. Shri Anand Daga Independent Non-Executive 4 4 No

5. Smt Vidula Jalan Promoter Non-Executive 4 4 No

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(iii) BOARD’S PROCESSESAll major decisions of the Company are regularly placed before the Board in addition to information with regard toactual operations, major litigation, feedback reports and minutes of Committee Meetings. The members are providedwith the requisite information mentioned in the listing agreement well before the Board Meetings.

(C) CODE OF CONDUCT(i) The Board has already prepared a Code of Conduct for all Board Members and Senior Management personnel of the Company.(ii) The Code of Conduct has been posted on the website of the Company.(iii) All Board members and Senior Management personnel have affirmed compliance with the code.

III. COMMITTEES OF THE BOARDThe Board of Directors has constituted the following Committees, namely the Audit Committee, Shareholders GrievanceCommittee and the Remuneration Committee apart from Share Transfer Committee.A. AUDIT COMMITTEE

The Audit Committee has been mandated with the same terms of reference as specified in Clause 49 of the ListingAgreement with the Stock Exchanges. The terms of reference also conform to the requirements of Section 292A ofthe Act.As on 31st March 2014, the Audit Committee had three Non-Executive Independent Directors as members, viz ShriN G Khaitan, Shri Prabir Chakravarti and Shri S K Parik. Shri N G Khaitan has been acting as the Chairman of the AuditCommittee. The Audit Committee of the Company ensures an effective internal control system.The details of Audit Committee Meetings held during the year 2013-14 are as under:

AUDIT COMMITTEE ATTENDANCE

No. ofMeetings attendedDirectors

Shri N G Khaitan 4

Shri Prabir Chakravarti 4

Shri S K Parik 4

AUDIT COMMITTEE MEETINGS

1 08.05.13 3 3

2 08.08.13 3 3

3 12.11.13 3 3

4 13.02.14 3 3

CommitteeStrength

No. ofMembers presentSl. No. Date of

Meeting

Sl. No. Date of Board Meeting Board’s Strength No. of Directors present Remarks

1 08.05.2013 5 5 100%

2 08.08.2013 5 5 100%

3 12.11.2013 5 5 100%

4 13.02.2014 5 5 100%

(ii) The details of Board Meetings held during the year are as under :

At the invitation of the Committee, Internal Auditors,Cost Auditors,Statutory Auditors, Company Secretary who is actingas Secretary to the Audit Committee and the CFO of the Company also attend the Audit Committee meetings as and whenrequired to respond to the queries raised at the Committee Meetings.

B. REMUNERATION COMMITTEE

As on 31st March 2014, the Remuneration Committee comprises of three Independent Directors as members viz.ShriS. K. Parik, Shri N. G. Khaitan and Shri Prabir Chakravarti.

The Committee met once during the Financial Year 2013-14 on 12th November, 2013. Shri S K Parik chaired thisMeeting.


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Shareholders complaints received and redressed during the Financial Year 2013-14Number of grievances received during the year – NilNumber of grievances not resolved – NilAs on 31st March, 2014 there is no complaint pending.

D. SHARE TRANSFER COMMITTEEThe Company has a Share Transfer Committee to look into various matters pertaining to Share Transfer, Transmission,Transposition and related matters. The Committee presently comprises of Shri N G Khaitan, Shri S K Parik, Smt VidulaJalan and Shri Prabir Chakravarti.During the year 2013-14 twelve meetings of the Transfer Committee were held.

E. SECRETARYMiss Namrata Priya, Company Secretary, is the Compliance Officer and acts as the Secretary to all the Committees.

IV. SUBSIDIARY COMPANYThe Company does not have any subsidiary company.

V. DISCLOSURESA. The details of the related party transactions are given in Note 2.27 (6) to the Financial Statements. All individual

transactions with related parties or others were on arm’s length basis. Related party transactions are audited by theStatutory Auditor. There were no transactions which may have potential conflict with the interest of the companyat large.

B. In the preparation of financial statement, the Company has followed the text of the Accounting Standards as notifiedby Companies (Accounting Standards) Rules 2006, as amended u/s 211 (3c) of the Companies Act, 1956. However,Significant Accounting Policies of the Company have been given in Note 1 to the Financial Statements.

C. No money was raised by the Company through any public issue, rights issue, preferential issue, etc. in the last financialyear and hence provisions contained in this behalf in clause 49 of the Listing Agreement is not applicable to thecompany.

D. The Company has complied with all the requirements of the Stock Exchange(s) and the Securities and Exchange Boardof India on matters related to Capital Markets or any other matter, as may be applicable from time to time. Therewere no penalties imposed or strictures passed against the Company by the statutory authorities in this regard.

C. SHAREHOLDERS/INVESTORS GRIEVANCE COMMITTEEAs on 31st March 2014, shareholders/investors grievance committee consisted of two Independent Directors asmembers viz. Shri Prabir Chakravarti and Shri S K Parik.The Committee met once during the Financial Year 2013-14 on 28th March, 2014.The composition of the Committee and the attendance of each Member at the Meeting were as follows:


Shri S K Parik 1

No. ofMeetings attended

Name of Directors E-mail Address

[email protected]

Name of Directors No. of Meetings attended

Shri N G Khaitan 1


Shri S K Parik 1

The composition of the Committee and the attendance of each Member at the Meeting were as follows:

14

(ii) Shares held by DirectorsDetails of shareholding of directors as on 31st March, 2014

Sl.No. Name of the Directors

PerformanceBonus /

Commission

SittingFee

TotalSalary

(Rs.)

Perquisites and otherbenefits

1. Shri N G Khaitan Nil Nil Nil 81,000/- 81,000/-

2. Shri Prabir Chakravarti Nil Nil Nil 76,500/- 76,500/-

3. Shri S K Parik Nil Nil Nil 85,500/- 85,500/-

4. Shri Anand Daga Nil Nil Nil 27,000/- 27,000/-

5. Smt Vidula Jalan Nil Nil Nil 49,500/- 49,500/-

(Rs.) (Rs.) (Rs.) (Rs.)

E. (i) Remuneration of DirectorsDetails of Remuneration paid to the Directors for the financial year ended 31st March, 2014

F. Risk ManagementRisk Assessment and minimisation procedures have been framed by the Company and are reviewed by the Boardannually.

G. Management Discussion and Analysis :The Management Discussion and Analysis, as reviewed by the Audit Committee, is a part of this Annual Report.

H. Insider TradingThe Company’s Code of Procedure & Conduct formulated as per the SEBI (Prohibition of Insider Trading) Regulations,1992, as amended, is in full force and effect.

I. Shareholders Information(i) Disclosures in relation to the appointments and re-appointments of Directors

As required under Clause 49(IV)(G)(i) of the Listing Agreement, brief profiles of Shri N.G.Khaitan, Shri PrabirChakravarti, Shri S.K. Parik, Shri Anand Daga and, Smt. Vidula Jalan are appended:a) Shri N G Khaitan (DIN 00020588) is a Senior Partner of Khaitan & Co. based in Kolkata. He passed his

Attorney-ship Examination from the Calcutta High Court in the year 1974 and stood first in the Preliminary,Intermediate and Final Examinations and was awarded Bell Chamber's Gold Medal by the IncorporatedLaw Society, High Court, Calcutta. He is a Notary Public appointed by the Govt. of India. He has richexperience in all aspects of laws and more particularly, Real Estate, Corporate laws and has handledimportant Litigations covering different branches of laws including Mergers & Acquisition, Restructuringand De-mergers. He has advised several large industrial houses and multinational corporations on multifariouslegal matters. He has also been a lead speaker in different seminars and symposiums on varied legal issues.He is a Committee member of the Federation of Indian Chambers of Commerce and Industry, New Delhi;President, Indian Council of Arbitration, New Delhi; Vice- President of Bharat Chamber of Commerce,Executive Committee member of The Agri-Horticultural Society of India, Executive Committee member ofa leading school in Kolkata and had been President of two leading Social Clubs in Kolkata. He has directorshipand committee membership in the following companies: Chase Bright Steel Ltd.; HSIL Ltd. Member - AuditCommittee & Chairman- Shareholder/Investor Grievance Committee; J K Lakshmi Cement Ltd. Member -Audit Committee and Shareholder/Investor Grievance Committee; Mangalam Cement Ltd. Member - AuditCommittee; Naga Dhunseri Group Ltd.; Reliance Chemotex Inds. Ltd. Member – Audit Committee; RasoiLtd; India Power Corpn Ltd. Member – Audit Committee; Warren Tea Limited. He is a director in theCompany since 29th January, 1985 and does not hold any shares of the Company.

Directors No. of Equity Shares heldShri N G Khaitan NilShri Prabir Chakravarti NilShri S K Parik NilShri Anand Daga NilSmt Vidula Jalan 1,03,527


15

b) Shri Prabir Chakravarti (DIN 00273523) is BA (Hon’s), MA (Economics), L.L.B (Calcutta University) and MBAfrom Queens University, Belfast, U.K. He has vast experience in Textile Business. He has been a PastPresident of All India Organization of Employers, New Delhi (1995-96), Bharat Chamber of Commerce(1993-94), Calcutta Club Ltd (1996) and Rotary Club of Calcutta (1994-95). He has been Past District Governorof Rotary International District 3920 (2004-2005). He has been a member of the State Labour StandingCommittee, West Bengal, Sikkim and Andaman Nicobar Islands. Presently he is a member of the Board ofGovernor, Institute of Business Management & Social Welfare (Calcutta University). He is a Rotarian since1972 of Rotary Club of Calcutta. He has directorship and Committee membership in the following Companies:Baghmari Tea Company Ltd. Nicco Financial Services Ltd.; Reliance Jute Mills (International) Ltd.; VidulaConsultancy Services Ltd.; BNK Capital Markets Ltd. Member – Audit Committee; Nicco Corporation Ltd.Member – Audit Committee; Jayshree Chemicals Ltd. Member – Audit Committee; Sri Girija PrasananaCotton Mills Ltd. He is a director in the Company since 15th May, 2009 and does not hold any shares ofthe Company.

c) Shri S. K. Parik (DIN 00055800) is a Fellow Member of the Institute of Chartered Accountants of India andalso of the Institute of Company Secretaries of India, having vast experience in the field of Finance, Taxation,Company Law and other related matters. He is a director in Hada Textiles Industries Ltd. He is director inthe Company since 6th June, 1996 and does not hold any shares of the Company.

d) Shri Anand Daga (DIN 00897988) is B.Com from St. Xavier’s College, Kolkata. He has done various courseson Financial Planning. He has been actively involved in the family business and also provides financialconsultancy to various Companies. He does not hold any directorship in any other Company. He is directorin the Company since 8th December, 2010 and does not hold any shares of the Company.

e) Smt. Vidula Jalan (DIN 01474162) is MBA in Strategic Marketing, Leadership and Change Managementfrom the Indian School of Business, Hyderabad. Moreover, she also has an Accounting and Finance degreefrom The University of Manchester, U.K. She is also managing the affairs of reputed schools and charitabletrusts of the B. K. Birla Group (the “Group”). She joined the board of Mangalam Timber Products Ltd. on29th June, 2005. She also holds Directorship in Vidula Consultancy Services Limited and Mangalam CementLimited. She holds 1,03,527 shares of the Company.

ii) Means of Communicationa) Quarterly Results:

i) Which newspapers normally published in The Financial Express/Business Standard in English (All India Edition)and Dharitry/Sambad in Oriya (Regional).

ii) Any website, where displayed www.mangalamtimber.comb) Shareholders’ grievances/complaints:

Grievance Committee Details given in Item No.III(C) of this report.E-mail ID for investors [email protected]

iii) Details of Last Three Annual General Meetings :

2012-13 Nabarangpur, Odisha 17.08.13 10 AM N. A. N. A.2011-12 Nabarangpur, Odisha 17.08.12 10 AM N. A. N. A.2010-11 Nabarangpur, Odisha 08.08.11 10 AM N. A. N. A.

Financial Year Location If Special Resolution putthrough postal ballot

Date Time Details of voting pattern

No Special Resolution has been passed in the previous three Annual General Meetings.No Special Resolution is proposed to be conducted through postal ballot.

16

Bombay Stock Exchange Limited 516007 Phiroze Jeejeebhoy Towers,Dalal Street, Mumbai – 400 001

National Stock Exchange of India Limited MANGTIMBER Exchange Plaza, 5th Floor, Plot No.C/1,G-Block Bandra-Kurla Complex,Bandra (E), Mumbai - 400 051

ISIN No. INE805B01012

Stock Exchange Code Address

viii) Distribution of Shareholding as on 31st March, 2014a) According to Category of Holders :

iii) Financial Calendar 2013-14 :First Quarterly Results : On or before 14th August, 2014Second Quarterly Results : On or before 14th November, 2014Third Quarterly Results : On or before 14th February, 2015Audited Yearly Results for the YearEnded 31st March, 2015 : On or before 30th May, 2015

iv) Investors Correspondence :All queries of investors regarding the Company’s shares in Physical/Demat form may be sent to the Company’s HeadOffice or to its Registrars and Share Transfer Agent.

v) Listing on Stock Exchanges : Equity Shares of the Company are listed at the following Stock Exchanges:

vi) Listing Fees : Company has paid the Listing Fees for the year 2014-15 to all the Stock Exchanges where the securities are listed.

There are no arrears in payment of Listing Fees.vii) Custodial Fees to Depositories : Custodial Fee for the year 2014-15 has been paid to National Securities Depository Ltd. and to Central Depository

Services (India) Ltd.

H. SHAREHOLDER INFORMATION i) Next Annual General Meeting :

Date : 16th August, 2014Time : 10.00 A.M.Venue : Village-Kusumi, P.O. & Dist.-Nabarangpur 764 059, Odisha.Book Closure Date : 12th August, 2014 to 16th August, 2014

(Both days inclusive)ii) Financial Year : 1st April to 31st March

CATEGORY NO. OF SHARE HOLDERS % OF SHARE HOLDERS NO. OF SHARES % OF SHARES

Promoters 14 0.06 8722921 47.60Non-Promoters :UTI 1 0.00 11300 0.06Mutual Fund 4 0.02 11700 0.07FI(s) 1 0.00 200 0.00Banks 3 0.01 700 0.00FII(s) 1 0.00 2100 0.01Corporate 365 1.68 2734680 14.92Individuals 19975 91.60 6440774 35.14NRI / OCB 1444 6.63 403025 2.20

21808 100.00 18327400 100.00


17

b) According to number of Equity Shares held :

ix) Share Transfer System

Share transfer in physical form are registered by the Registrars and placed before the Transfer Committee for approvaland certificates are returned to the respective transferees within a period of fifteen days, provided the documentslodged with the Registrars/Company are clear in all respects.

In the case of Shares held in Electronic Form, the transfers are processed by NSDL/CDSL through the respectiveDepository Participants.

x) Dematerialisation of shares

As per notifications issued by the Securities and Exchange Board of India (SEBI), the trading in Company’s shares is permittedonly in dematerialised form. In order to enable the shareholders to hold their shares in electronic form and to facilitatescripless trading, the Company has enlisted its shares with National Securities Depository Limited (NSDL) and CentralDepository Services Limited (CDSL).

Share Dematerialisation records : The following data indicates the extent of Dematerialisation of Company’s shares as on31st March, 2014.

Range Shareholders Shares

No. of Shares Number % to total holders Numbers % to total capital

1 500 19825 90.91 3193946 17.43

501 1,000 1178 5.40 994613 5.43

1,001 2,000 403 1.85 630607 3.44

2,001 3,000 132 0.61 341979 1.87

3,001 4,000 61 0.28 219334 1.20

4,001 5,000 59 0.27 283540 1.54

5,001 10,000 74 0.33 535554 2.92

10,001 ABOVE 76 0.35 12127827 66.17

TOTAL 21808 100.00 18327400 100.00

No. of Shares Dematerialised : 16184395

No. of Shareholders in D’mat form : 10069

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xii) Depository Services

For guidance on depository services, Shareholders may write to the Company or to the respective Depositories asgiven below :-National Securities Depository Ltd. Central Depository Services (India) Ltd.4th Floor, A Wing, Trade World, Kamala Mills Compound Phiroze Jeejeebhoy TowersSenapati Bapat Marg, Lower Parel, Mumbai 400 013 17th Floor, Dalal Street, Mumbai 400 023Telephone : (022) 2499 4200 Telephone : (022) 2272 3333/3224Fax : (022) 2497 2993 Fax : (022) 2272 3199E-mail : [email protected], Website : www.nsdl.co.in Website : www.cdslindia.com

xi) Market Price Data (Rs.)

MONTH BOMBAY STOCK EXCHANGE NATIONAL STOCK EXCHANGE

HIGH LOW HIGH LOW

APRIL, 2013 14.90 11.05 15.25 9.55

MAY, 2013 14.50 10.10 14.00 9.50

JUNE, 2013 12.20 8.99 12.05 12.05

JULY, 2013 11.99 10.02 12.20 11.60

AUGUST, 2013 10.69 9.10 12.15 11.55

SEPTEMBER, 2013 10.45 9.00 11.00 8.70

OCTOBER, 2013 9.97 7.76 9.90 7.70

NOVEMBER, 2013 9.76 7.73 7.65 7.05

DECEMBER, 2013 8.79 7.06 7.45 6.75

JANUARY, 2014 9.50 7.35 9.95 7.50

FEBRUARY, 2014 9.21 8.17 9.65 7.60

MARCH, 2014 12.39 8.65 12.65 8.80

xiii) The Company has not issued any GDRs/ADRs/warrants or any convertible instruments during the year.

xiv) Registered Office and Plant Location

Vill. Kusumi, P.O. & Dist. Nabarangpur - 764 059, OdishaPhone No: (06858) 222148/222142/222053Fax : (06858) 222042CIN : L02001OR1982PLC001101Email : [email protected]

xv) Registrars and Share Transfer Agent

M/s. C B Management Services (P) Ltd.P-22, Bondel Road, Kokata - 700 019E-mail : [email protected], Website : www.cbmsl.comPhone No : (033)22806692/93/94, 40116700/40116711Fax No.: (033) 22870263


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F. CEO/CFO CERTIFICATION

The CEO and CFO certification of the financial statements and the Cash Flow Statements for the year are forming part ofthis Annual report.

G. ADOPTION OF MANDATORY AND NON- MANDATORY REQUIREMENTS OF CLAUSE 49

The Company has complied with all mandatory requirements of the Clause 49 of the Listing Agreement. The Company hasadopted following non-mandatory requirements of Clause 49 of the Listing Agreement:

Remuneration Committee:-

The Company has a remuneration committee consisting of three independent Directors namely Shri S.K.Parik, ShriN.G. Khaitan and Shri Prabir Chakravarti as stated in item no III (B) above.

Shareholders’ Rights:-

The Company’s half yearly results are published in English and Oriya Newspapers having wide circulation and are alsodisplayed on the Company’s website. Hence, same are not sent to the shareholders.

Audit Qualifications:-

During the year under review, there was no audit qualification in the Company’s financial statements. The Companycontinues to adopt best practices to ensure a regime of unqualified financial statements.

Whistle Blower policy :-

The Company does not presently have a formal Whistle blower policy. However, no employee is denied access to theAudit Committee should a specific request to this effect be received.

H. COMPLIANCE CERTIFICATE FROM AUDITOR:

The Company has obtained a certificate from the Auditor of the Company confirming that it is in compliance with theconditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement.

Dated : 14th May, 2014Place : Kolkata

N G KhaitanPrabir ChakravartiAnand DagaVidula Jalan

Directors

CEO AND CFO CERTIFICATION

DECLARATION BY THE CEO PURSUANT TO CLAUSE 49 OF THE LISTINGAGREEMENT CONTAINING CORPORATE GOVERNANCE

This is to confirm that the code of conduct for all board members and senior management personnel of the Company has beencirculated to the concerned persons of the Company and the Company has received affirmation of compliance with the codeof conduct from the members of the board of directors and the senior management personnel of the Company.

Tara Chand SharmaManager

Dated: 14th May, 2014

Place: Kolkata

To,The Board of Directors,Mangalam Timber Products Ltd.We, to the best of our knowledge and belief, certify that:

1. We have reviewed the financial statements and the cash flow statement for the year ended 31st March, 2014 and that ofthe best of our knowledge and belief;

(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements thatmight be misleading;

(ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existingaccounting standards, applicable laws and regulations.

2. There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year which arefraudulent, illegal or violating the Company’s code of conduct.

3. We accept responsibility for establishing and maintaining internal controls for financial reporting and have evaluated theeffectiveness of internal control systems of the Company and have disclosed to the auditors and the audit committee,deficiencies in the design or operation of internal controls, pertaining to financial reporting, if any, of which we are awareand the steps we have taken, propose to take to rectify these deficiencies.

4. We have indicated to the auditors and the audit committee;

a) significant changes in internal controls for financial reporting, during the year;

b) significant changes in accounting policies during the year and that the same have been disclosed in the Notes to theFinancial Statements, and;

c) instances of significant fraud of which we have become aware and the involvement there in, if any, of the managementor an employee having a significant role in the Company’s internal control system over financial reporting.

Tara Chand SharmaManager

Amit Kumar AgarwalChief Financial Officer

Date : 14th May, 2014Place : Kolkata

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AUDITORS’ CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATEGOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENT

To

The Members of Mangalam Timber Products Ltd.

We have reviewed the compliance of conditions of corporate governance by Mangalam Timber Products Limited (the company)for the year ended on 31st March, 2014, as stipulated in clause 49 of the Listing Agreement of the said Company with stockexchanges.

The compliance of conditions of corporate governance is the responsibility of the management. Our examination was limitedto a review of the procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditionsof the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Companyhas complied with the conditions of Corporate Governance as stipulated in clause 49 of the above-mentioned Listing Agreement.

On the basis of records maintained by the company, we state that as on 31st March, 2014 there was no investor grievanceremaining pending for a period exceeding one month against the company.

We further state that such compliance is neither an assurance as to future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.

For S M DAGA & CO.Chartered Accountants

Firm Registration Number: 303119ES M DAGAPartnerMembership No.495111, Clive Row, Kolkata – 700 001

Dated: 14th May, 2014Place: Kolkata


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INDEPENDENT AUDITOR’S REPORTWe have audited the accompanying financial statements ofMANGALAM TIMBER PRODUCTS LIMITED, which comprise theBalance Sheet as at 31st March, 2014, and the Profit & LossStatement and Cash Flow Statement for the year ended on thatdate, and a summary of significant accounting policies andother explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation of these financialstatements that give a true and fair view of the financial position,financial performance and cash flows of the Company inaccordance with the Accounting Standards notified under theCompanies Act, 1956 (The Act) read with General Circular15/2013 dated 13th September, 2013 of the Ministry ofCorporate Affairs in respect of section 133 of the CompaniesAct, 2013. This responsibility includes the design,implementation and maintenance of internal control relevantto the preparation and presentation of the financial statementsthat give a true and fair view and are free from materialmisstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financialstatements based on our audit. We conducted our audit inaccordance with the Standards on Auditing issued by theInstitute of Chartered Accountants of India. Those Standardsrequire that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance about whetherthe financial statements are free from material misstatement.

An audit involves performing procedures to obtain auditevidence about the amounts and disclosures in the financialstatements. The procedures selected depend on the auditor’sjudgment, including the assessment of the risks of materialmisstatement of the financial statements, whether due to fraudor error. In making those risk assessments, the auditor considersinternal control relevant to the Company’s preparation and fairpresentation of the financial statements in order to design auditprocedures that are appropriate in the circumstances but notfor the purpose of expressing an opinion on the effectivenessof the Company’s internal control. An audit also includesevaluating the appropriateness of accounting policies used andthe reasonableness of the accounting estimates made by

management, as well as evaluating the overall presentation ofthe financial statements.

We believe that the audit evidence we have obtained is sufficientand appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and accordingto the explanations given to us, the aforesaid financialstatements give the information required by the CompaniesAct, 1956 in the manner so required and give a true and fairview in conformity with the accounting principles generallyaccepted in India.

a) In the case of Balance Sheet, of the state of affairs of theCompany as at 31st March, 2014.

b) In the case of the Profit & Loss Statement, of the Loss forthe year ended on that date.

c) In the case of the Cash Flow Statement, of the cash flowsfor the year ended on that date.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditors’ Report) Order,2003 as amended by the Companies (Auditor’s Report)(Amendment) Order, 2004 issued by the Central Governmentin exercise of the power conferred by section 227(4A) of theCompanies Act, 1956 (the Act) on the matters specified inparagraph 4 and 5 of the said Order, we report that -

i) a) The company has maintained proper recordsshowing full particulars including quantitative details andsituation of fixed assets.

b) As explained to us Fixed Assets of the companyare physically verified by the management according to a phasedprogramme designed to cover all the items over a period ofthree years which considering the size and nature of operationsof the company appears to be reasonable. Pursuant to suchprogram, a portion of fixed assets have been physically verifiedby the management during the year and no materialdiscrepancies between book records and physical inventoryhave been noticed.

c) In our opinion, there was no substantialdisposal of fixed assets during the year.


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ii) a) The management has conducted physicalverification of inventory, except stock lying with third partiesand stock in transit at reasonable intervals. In our opinion, thefrequency of physical verification is reasonable.

b) In our opinion and according to the informationand explanations given to us, the procedure of physicalverification of inventories followed by the management isreasonable and adequate in relation to the size of the companyand the nature of its business.

c) In our opinion and according to the informationand explanations given to us, the company has maintainedproper records of inventory and discrepancies between thephysical stock and book records which were material in respectof certain items of inventories, have been properly dealt inbooks of account.

iii) a) The company has not granted any loan,secured or unsecured to companies, firm or other partiescovered in the register maintained under section 301 of theCompanies Act, 1956.

b) Clause 4(iii) (b), (c) and (d) of the aforesaidorder are not applicable.

c) The company has not taken any loans securedor unsecured loan from companies, firms or other partiescovered in the register maintained under section 301 of thecompanies Act, 1956.

d) Clauses 4(iii)(f) and (iii)(g) of the aforesaidorder are not applicable.

iv) In our opinion and according to the informationand explanations given to us, there is adequate internal controlsystem commensurate with the size of the company and natureof its business with regard to purchase of inventory, fixed assetsand for the sale of goods and services. During the course ofour audit we have not come across any continuing failure tocorrect major weakness in internal control system.

v) a) In our opinion and according to theinformation and explanations given to us, the particulars ofcontracts or arrangements that need to be entered in theregister maintained under section 301 of the Act have beenso entered.

b) In our opinion and according to informationand explanations given to us, the transactions made inpursuance of such contracts or arrangements and exceedingRupees five lacs in value in respect of each party during theyear have been made at prices which are reasonable havingregard to prevalent market prices at the relevant time otherthan the transactions of special nature for which competitivequotations are not available.

vi) The company has not accepted any deposit frompublic within the meaning of section 58A of the CompaniesAct, 1956.

vii) The company has an internal audit system, whichin our opinion, is commensurate with the size of the Companyand nature of its business.

viii) We have broadly reviewed the cost recordsmaintained by the Company pursuant to the Companies (CostAccounting Records) Rules, 2011 prescribed by the CentralGovernment under section 209(1)(d) of the Companies act,1956 and are of the opinion that prima facie the prescribedcost records have been maintained. We have however, notmade a detailed examination of the cost records with a viewto determine whether they are accurate or complete.

ix) a) According to the records of the companyexamined by us and according to information and explanationsgiven to us, in our opinion the company has generally beenregular in depositing undisputed statutory dues includingInvestor Education and Protection Fund, Employees StateInsurance Income Tax, Sales Tax, Wealth Tax, Service Tax,Customs Duty, Excise Duty, Cess and any other material statutorydues except Provident Fund applicable to it with appropriateauthorities.

b) According to the records of the Companyexamined by us and according to information and explanationsgiven to us, there are no dues of Income Tax, Sales Tax, WealthTax, Service Tax, Customs Duty, Excise Duty and cess whichhave not been deposited on account of any dispute except asdetailed hereunder:

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x) The accumulated losses of the Company haveexceeded fifty percent of its net worth as at 31stMarch, 2014. It has incurred cash losses in thecurrent financial year and in the immediatelypreceding financial year.

xi) As per books and records maintained by thecompany and according to the information andexplanations made available to us, the company

has not defaulted in repayment of any dues tofinancial institutions, banks and debenture holders.

xii) According to information and explanations given tous and based on the documents and recordsproduced, the company has not granted any loansand advances on the basis of the security by wayof pledge of shares, debentures and other securities.

Central Excise Act, 1944 Excise 1993-94 3.49 Assistant Commissioner Central Excise

Excise 2000-01 126.57 Central Excise Service Tax Appellate Tribunal



Orissa & Bihar Excise Act, 1915 Excise 2002-03 21.39 High Court of Orissa

Excise 2003-04 135.75 High Court of Orissa




Excise 2007-08 120.37 Dist.Magistrate & Collector, Nabarangpur

Excise 2008-09 103.20 Dist.Magistrate & Collector, Nabarangpur

Excise 2009-10 96.60 District Magistrate & Collector,Nabarangpur

Excise 2010-11 57.60 District Magistrate & Collector,Nabarangpur

West Bengal Sales Tax Act, 1941 Sales Tax 1986-87 0.16 Assistant Commissioner Commercial Taxes

Sales Tax 1987-88 0.06 Assistant Commissioner, Commercial Taxes

Sales Tax 1993-94 0.33 Assistant Commissioner Commercial Taxes

Central Sales Tax Act, 1956 Sales Tax 1987-88 0.05 Assistant Commissioner, Commercial Taxes

Sales Tax 1994-95 0.72 Assistant Commissioner, Commercial Taxes

Sales Tax 1999-00 2.02 Additional Commissioner, Commercial Taxes

Sales Tax 2000-01 93.56 Central Sales Tax Tribunal

Sales Tax 2001-02 110.00 Sales Tax Tribunal




Sales Tax 2008-09 0.74 Appellate Deputy Commissioner

Sales Tax 2009-10 0.47 CTO

Orissa Entry Tax Act, 1999 Entry Tax 2000-01 8.11 Sales Tax Tribunal

Entry Tax 2002-03 28.35 Sales Tax Tribunal

Entry Tax 2007-09 11.07 Additional Commissioner, Commercial Taxes

Orissa Sales Tax Act, 1947 Sales Tax 2002-03 1.85 Sales Tax Tribunal

Orissa VAT Act, 2004 VAT 2005-07 17.20 Sales Tax Tribunal

VAT 2007-09 20.38 Additional Commissioner Commercial Taxes

Income Tax Act, 1961 Income Tax 2007-08 70.28 Commissioner of Income Tax (Appeal)

Name of the Statute Nature of the Dues Year Rs. in Lacs Forum where dispute is Pending


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xiii) In our opinion, the company is not a chit fund or anidhi/mutual fund/society. Accordingly, theprovisions of clause 4(xiii) of the order are notapplicable to the Company.

xiv) In our opinion the company is not dealing in ortrading in shares, securities, debentures and otherinvestments. Accordingly, the provisions of clause4(xiv) of the order are not applicable to theCompany.

xv) According to the information and explanations givento us, the company has not given any guarantee forloans taken by its associates or subsidiaries or othersfrom bank or financial institutions during the year.

xvi) In our opinion and on the basis of information andexplanations given to us, on an overall basis, theterm loans have been applied for the purposes forwhich they were obtained.

xvii) On the basis of information received from themanagement and based on our overall analysis ofthe Balance Sheet of the Company, the companyhas not used any funds raised on short-term basisfor long term purposes.

xviii) During the year, the Company has not made anypreferential allotment of shares to parties orcompanies covered in the Register maintained undersection 301 of the Act. Accordingly clause 4(xviii)of the aforesaid order is not applicable.

xix) The company does not have any outstandingdebentures during the year.

xx) The company has not raised any money throughpublic issue during the year.

xxi) During the course of our examination of the booksof accounts carried out in accordance with thegenerally accepted auditing practices in India forthe purpose of reporting the true and fair view ofthe financial statements, we have neither comeacross any incidence of fraud on or by the companynor have we been informed of any such case by theManagement.

2. As required by Section 227(3) of the Act, we report that:

a) We have obtained all the information andexplanations, which to the best of our knowledgeand belief were necessary for the purpose of ouraudit.

b) In our opinion, proper books of account as requiredby law have been kept by the Company so far asappears from our examination of these books.

c) The Balance Sheet and Profit & Loss Statement andCash Flow Statement dealt with by this report arein agreement with the Books of Account.

d) In our opinion, the Balance Sheet, Profit & LossStatement and Cash Flow Statement comply withthe accounting standards notified under theCompanies Act, 1956 read with General Circular15/2013 dated 13th September, 2013 of the Ministryof Corporate affairs in respect of Section 133 of theCompanies Act, 2013.

e) In our opinion and according to the explanationsgiven to us none of the Directors are disqualifiedfrom being appointed as directors under clause (g)of sub-section (1) of section 274 of the CompaniesAct, 1956.

For S M DAGA & CO.Chartered Accountants

Firm Registration No. - 303119E

S M DagaPartner

Membership No. 495111, Clive Row, Kolkata - 700 001

Dated, The 14th Day of May, 2014

APPLICATIONS OF MDF

“Birla Building”, 10th Floor9/1, R N Mukherjee Road

Kolkata - 700 001

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