IDEAL CARPETS LIMITED - Moneycontrol.comBrief resume of the Directors retiring by rotation and...

ANNUAL REPORT-2010-11

IDEAL CARPETS LIMITED Regd Off: C-4/118, Safdarjung Enclave, New Delhi-110 029

NOTICE Notice is hereby given that the 20th Annual General Meeting of the Members of IDEAL CARPETS LIMITED will be held on Friday, the 30th day of September, 2011 at 11.00 A.M. at the Registered Office of the Company at C-4/118, Safdarjung Enclave, New Delhi to transact the following businesses: ORDINARY BUSINESS

1. To receive, consider and adopt the audited Balance Sheet as at 31.03.2011 and the Profit & Loss Account for the year ended on that date and Reports of the Board of Directors and Auditors thereon.

2. To appoint a director in place of Mr. Lalla Ram Mourya, who retires by rotation & being

eligible, offers himself for re-appointment.

3. To appoint a director in place of Mr Piyush Verma, who retires by rotation & being eligible, offers himself for re-appointment.

4. To appoint Auditors of the Company to hold office from the conclusion of this Annual

General Meeting until conclusion of the next Annual General Meeting and to fix their remuneration.

SPECIAL BUSINESS

5. To consider and if thought fit to pass with or without modification the following Resolution as an Ordinary Resolution:

“ RESOLVED THAT Shri Prabhu Nath Yadav who was appointed as Additional Director and holds office upto the date of this Annual General Meeting of the Company and in respect of whom the company has received a Notice in writing under Section 257 of The Companies Act, 1956, from a member proposing his candidature for office of Director, be and is hereby appointed as Director of the Company.”

By Order of the Board of Di rectors IDEAL CARPETS LIMITED

Place: New Delhi Date: 02.09.2011 L R Maurya

(Chairman)



NOTES:-

1. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of himself and such proxy need not be a member of the Company.

2. Proxy Form and Attendance Slip are enclosed. Proxies, in order to be valid, must reach at

the Registered Office of the Company not later than forty-eight hours before the commencement of the meeting.

3. The Register of Members & Share Transfer Books of the Company will remain closed

from 27th September 2011 to 30th September 2011 (both days inclusive).

4. Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956 is attached and forms part of this notice.

5. Members can send the shares for transfer in physical form and all other related queries to

the office at the Company’s Registrars M/s Beetal Financial & Computer Services Private Limited at their address at Beetal House, IIIrd Floor, Madangir, Behind Local Shopping Centre, Near Dada Harsukdas Mandir, New Delhi-110062

6. Members are requested to immediately intimate changes, if any, in their registered

addresses along with the PIN Code to the Company or the Registrars so as to enable the Company to address future communication to their correct addresses.

7. Members are informed that in the case of joint holders attending the meeting, only

such joint holder who is higher in the order of names will be entitled to vote.

8. In terms of Section 109A of the Companies Act, 1956, Members are entitled to make nomination in respect of shares held be them in physical form. Members desirous of making nominations are requested to send their requests in Form 2B in duplicate to the office at the Company’s Registrars M/s Beetal Financial & Computer Services Private Limited at their address at Beetal House, IIIrd Floor, Madangir, Behind Local Shopping Centre, Near Dada Harsukdas Mandir, New Delhi-110062. The nomination forms will be available to the members on request.

9. Members holding shares in multiple folios in the same name or in the same order

of names are requested to consolidate their holding into a single folio.

10. Brief resume of the Directors retiring by rotation and seeking re-appointment and other details as stipulated under Clause 49(IV)(G) of the Listing Agreement are provided as an annexure to the Notice. The Company has received the requisite Form DD-A from the said Directors in terms of Companies (Disqualification of Directors under Section 274(1) (g) of the Companies Act, 1956) Rules, 2003 confirming their eligibility for re-appointment.



EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT 1956, IN RESPECT OF: ITEM NO.5 Shri Prabhu Nath Yadav was appointed as an Additional Director under Section 260 of The Companies Act, 1956 w.e.f 13.08.2011. Accordingly, Shri Prabhu Nath Yadav will hold office of the Director upto the date of this Annual General Meeting. The Company has received a notice in writing from a member under the provisions of Section 257 of The Companies Act, 1956, proposing the candidature of Shri. Prabhu Nath Yadav for the office of Director. Requisite consent, pursuant to Section 264(1) of the Act, has been filed by Shri Prabhu Nath Sharma to act as such Director, if appointed. Profile of Shri Prabhu Nath Yadav (In pursuance of Clause 49 of Listing Agreement) Name : Shri Prabhu Nath Yadav Father’s Name : Shri Raj Mani Yadav Address : Vill- Dhanapur, Gopiganj, Gyanpur, S.R.N. Bhadohi. Nationality : Indian Date of Birth : 05.10.1963 PAN No. : AGRPY6469J. Qualification & Experience He is a Graduate in Commerce and has experience of more than 25 years in marketing and production in carpet industries. He does not have any directorship in any other Company. He is a member of Audit Committee and Remuneration Committee of the Company. None of the Directors are interested with this resolution except Mr Prabhu Nath Yadav.

By Order of the Board of Di rectors IDEAL CARPETS LIMITED


(CHAIRMAN)



DIRECTORS’ REPORT Dear Shareholders, Your directors are pleased to present the 20th Annual Reports together with the Annual Accounts of the Company for the year ended on 31st March 2011. FINANCIAL RESULTS Your Company’s performance during the year as compared with the previous year is summarised as below:

(Amount in Rupees)

Particulars

2010-2011 2009-2010Income Sales 61,530,232.34 106,649,099.00Job Charges 4,002,757.07 1,403,077.00Other Income 7,071,418.07 15,199,621.00Total 72,604,407.41 123,251,797.00Profit before Depreciation & Interest 8,703,757.36 10,317,515.29Less: Depreciation 2,174,666.00 2,051,579.11 Interest 6,111,342.49 7,451,806.55Profit/(Loss) before Tax 417,748.87 8,14,129.63Less: Provision for tax 280,285.00 388,776.00Profit/(Loss) after Tax 137,463.87 425,353.63Add: Exchange Reserve Adjusted -- 5,858, 482.88Less: Income Tax for earlier years adjustment 10,000.00 (27,432.00)Add : Profit b/d from P/Y 71,379,857.42 65,068,588.91Profit carried to Balance Sheet 71,507,321.29 71,379,857.42 FINANCIAL HIGHLIGHTS The Company’s turnover during the current year is Rs.6.1 Crore in comparison to Rs. 10.66 Crore (previous year). The net profit before tax of the Company is Rs. 4.17 Lacs as against profit of Rs. 8.14 Lacs (previous year).

OPERATIONS During the year, the turnover of the Company has been decreased by 42.30% due to increased global competition in the overseas market on the one hand and imports in domestic market of cheap textiles from other Asian neighbours on the other hand. DIVIDENDS Keeping in view of the working capital requirement of the Company, your Directors regret that they are unable to recommend any dividend for the year 2010-2011.


TRANSFER TO RESERVE The Company had not transferred any amount in the General Reserves during the year. MATERIAL CHANGE There was no material change affecting the financial position of the Company between the date of balance sheet and the date of this report. DIRECTORATE Shri Lalla Ram Maurya and Shri Piyush Verma retire from the Board of Directors by rotation in the ensuing Annual General Meeting, in accordance with the provisions of Section 255 and 256 of The Companies Act, 1956 and being eligible offers themselves for reappointment. Shri Prabhu Nath Yadav was appointed as an Additional Director by Board of Directors of the Company with effect from 13.08.2011 and he may hold the office of Director upto the date of Forthcoming Annual General Meeting. The Company has received a notice in writing from a member proposing the candidature of Shri Prabhu Nath Yadav for the office of Director. REAPPOINTMENT OF AUDITORS M/s PRAKASH K. PRAKASH, Chartered Accountants, New Delhi, the Auditors of the Company who hold office upto the conclusion of the Annual General Meeting are eligible for reappointment and have expressed their willingness to be reappointed as Auditors of the Company. M/s PRAKASH K PRAKASH, Chartered Accountants have under Section 224(1) of The Companies Act, 1956 furnished a certificate of their eligibility for reappointment and they hold valid certificate of having Peer Reviewed of their firm. AUDITORS REPORT & NOTES ON ACCOUNTS The auditor remarks in the schedule of notes referred to in their report are self-explanatory. The explanation contained in those comments/notes may be treated as information/explanation submitted by the Board as contemplated under Section 217(3) of The Companies Act, 1956. PARTICULARS OF EMPLOYEES There is no information required to be given under Section 217(2A) of The Companies Act, 1956 read with The Companies (Particulars of Employees) Rules 1975 for the year under review as none of the employee falls in this category. AUDIT COMMITTEE The Audit Committee of the Company comprised of Mr Satish Singh, Rajesh Kumar, Shri Prabhu Nath Yadav and Mr. Piyush Verma. Mr Rajesh Kumar chairs the committee. The Audit Committee of Board of Directors reviews various auditing and accounting matters, including the recommendation of appointment of Auditors and fixing their remuneration and reviewing of annual statements of accounts.


CORPORATE GOVERNANCE REPORT A separate report on Corporate Governance along with a certificate from statutory Auditors regarding compliance with the conditions of Corporate Governance forms a part of Annual Report. MANAGEMENT DISCUSSION AND ANALYSIS As required by Clause 49 of the Listing Agreement with the Stock Exchanges, a Management Discussion and Analysis is appended to the Annual Report.

PUBLIC DEPOSITS The Company has not accepted any public deposits during the financial year under Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975. SUBSIDIARY The Annual Report along with Annual Financial Statements for the year ended 31.12.2010 of IDEAL CARPETS INC., USA, the Subsidiary of your Company has been attached to this report as required under Section 212 of The Companies Act, 1956. DIRECTORS RESPONSIBILITY STATEMENT Pursuant to the provisions of Section 217(2AA) of The Companies Act, 1956, the Directors hereby state and confirm:

a) That in the preparation of Annual Accounts for the Financial Year ended on 31.03.2011 the applicable accounting standards has been followed subject to note No 1 (i) of Schedule 19.

b) That the Directors selected such accounting policies and applied them consistently

and made judgments and estimates, that are 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 & loss Accounts of the Company.

c) 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 to safeguards the assets of the company and to prevent and detect fraud and other irregularities.

d) That the Directors have prepared the Annual Accounts on a “going concern”

basis. EMPLOYEE RELATIONS The company enjoyed good relations with all employees through the year. Your directors’ wish to place on record their appreciation of the contribution made by employees at all levels during the year.


CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION Information under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is given below: The Company is committed to the conservation of the resources. There is no wastage of energy and the working group formed by the company for this purpose, continuously monitors the consumption of various forms of energy and evaluates the options available for energy conservation. Investments will be made, as and when required, for any activity identified as a source for helping us to achieve further energy savings. Your company is not using any foreign technology. FOREIGN EXCHANGE EARNINGS & OUTGO:

Foreign Exchange Earnings Rs 4,35,71,011.00 Foreign Exchange Outgo Rs. 1,56,57,822.00

CORPORATE GOVERNANCE As per Clause 49 of the Listing Agreement with the Stock Exchanges a separate section on Corporate Governance has been setup which is ensuring proper implementations of the relevant requirements. A report on Corporate Governance and a certificate from the Auditors confirming compliance is part of this Report. FIXED DEPOSITS The Company has not accepted any fixed deposits during the year. ACKNOWLEDGEMENT Your Directors wish to place on record their appreciation for the continual co-operation, the Company received from the Bankers, Financial Institutions, Shareholders, Dealers and Suppliers and also acknowledges the invaluable contribution made by the employees.

By Order of the Board of Directors IDEAL CARPETS LIMITED


(CHAIRMAN)


AUDITORS’ CERTIFICATE

The Members, IDEAL CARPETS LIMITED New Delhi. We have examined the compliance of conditions of corporate governance by Ideal Carpets Limited for the year ended on 31st March 2011 as stipulated in Clause 49 of the Listing Agreement of the said company with the stock exchanges. The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to the procedure and implementation thereof, adopted by the company for ensuring the compliance of the conditions of 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 company has complied with the conditions of corporate governance as stipulated in the above-mentioned listing agreement except-

1. that shares of the company are not yet available for trading in dematerialized form;

2. that trading in the shares of the company is suspended; no data regarding prices of the shares is available for the period under review.

We state generally that no investor grievances are pending for a period exceeding 1 month against company as per records maintained by the Shareholder/ Investor Grievance Committee. We further state such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company.

For PRAKASH K. PRAKASH Chartered Accountants

Place: New Delhi Prakash K. Gupta Dated: 02.09.2011 (Partner) Mem No 80320


MANAGEMENT DISCUSSION & ANALYSIS OVERVIEW OVERALL REVIEW The Company adhered to the previous year’s policy and concentrated on exports. The Company never compromised on the quality of its products and firmly believes in its marketing strength and skills of its work force. However, The Company’s growth has been deteriorated due to increased global competition in the overseas market on the one hand and imports in domestic market of cheap textiles from other Asian neighbours on the other hand. Cotton exports couldn't pick up owing to disparity in domestic and international cotton prices. Inspite of all these factors, the company is trying to develop its domestic market for its growth. FINANCIAL PERFORMANCE

(Amount in Rupees)

Particulars 2010-2011

2009-2010 %

Increase / Decrease

Domestic Sales 17,959,221.34 14,730,846.00 +21.91 % Export Sales 43,571,011.00 91,918,253.00 - 52.59 %Total Turnover 61,530,232.34 106,649,099.00 - 42.30 %Profit/(Loss) before Tax 417,748.87 8,14,129.63 - 48.68 %Less: Provision for tax 280,285.00 388,776.00 - 27.90 %Profit/(Loss) after Tax 137,463.87 425,353.63 - 67.68 % Due to increased overseas competition, there is a reduction in demand of company’s products in international markets. Accordingly, export sales of the Company has been reduced by 52.59% as compared to previous Financial Year. However, inspite of excessive imports of cheap textiles products, domestic sales of the Company has been increased by 21.91% in comparison to previous year. Overall, the Company achieved total sales turnover of Rs. 615.30 Lacs for the year ended 31st March 2011 as compared to Rs. 1,066.49 Lacs of the previous year resulting into overall decrease of 42.30%. The Company has achieved profit before tax of Rs. 4.17 Lacs as compared to profit of Rs. 8.14 Lacs during previous year. The Management is keen to change its marketing and production strategies in the current year to improve its financial performance. INTERNAL CONTROL SYSTEMS The Company has adequate internal control procedures commensurate with the nature and size of its business. There is a proper safeguard of assets through internal control system, which prevents any wastage, loss and unauthorized use of any assets. Checks and balances are in place to ensure that transactions are adequately authorised and reported correctly. The internal audit department of the company audits activities of various departments to ensure that internal controls are in place. These are then reviewed by the Audit Committee of the Board and corrective actions are taken by the company where needed.


The company’s system primarily covers the aspects such as:

1. Control over operating parameters and various factors relating to production. 2. Efficient use and protection of resources. 3. Accuracy and promptness of financial reporting. 4. Compliance with laws and regulations.

OPPORTUNITIES AND THREATS Hand knotted carpet industry is one of the oldest industries of our nation. The craftsmanship coupled with traditional design skill of Indian weavers has been acknowledged world over for centuries. However, the Company is presently facing stiff competition from China, Japan, Korea, Pakistan & Nepal due to their unbelievable low pricing patterns. It has been observed that the demand for synthetic carpets is rapidly increasing as compared to woollen carpets. Moreover, the International trade of the Company is subject to currency rate fluctuation. RISK MANAGEMENT The Company derives revenues from both International and domestic markets. Any change in the colour and design of the Carpets in the International Marketing adversely affect the demand for the products, indirectly affecting the growth and development of company’s products. However, this indicates to be a low area of concern. The risk in the nature of change in import-export tariffs, non-availability of raw material, change in the strategies of the International markets, timely working capital arrangements etc., affects a lot in working of a carpet industry. The company’s main thrust is export and any unfavourable movement in the value of the Indian Rupees will decrease the amount of receivables from export debtors. The outlook for the Indian Rupee is also now considered to be relatively stable. Appropriate steps have been taken in order to face currency rate fluctuation risks. The company continues to follow suitable strategies to positively modify its risk profile by eliminating key business risks and implementing strategies to minimise the high risks. HUMAN RESOURCES Your company’s human resource continues to be the biggest asset as it is the ultimate key to the success of the organization. Employee relations were cordial and peaceful. The company is committed to foster a high performance environment, which characterizes the organizational climate that delivers the business strategy. The company has low labour turnover and has adequate system to reward and recognize the employee contribution towards the growth of the company. The Company is also committed to follow other measures to enhance the motivation and commitment of the work force and building up a unique positive work culture. CAUTIONARY STATEMENT Statements in the Management Discussions and Analysis describing the company’s objectives, projections, estimates, and expectations are “forward-looking statements”


within the meaning of applicable Securities Laws and Regulations. As `forward looking statements’ are based on certain assumptions and expectations of future events over which the company exercises no control, the company cannot guarantee their accuracy nor can it warrant that the same will be realised by the company. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the company’s operations include economic conditions affecting demand / supply and price conditions in the domestic and overseas markets in which the company operates, changes in the Government regulations, tax corporate and other laws and other incidental facts.

For IDEAL CARPETS LIMITED

CHAIRMAN & MANAGING DIRECTOR


CORPORATE GOVERNANCE

The detailed report on Corporate Governance as per the format prescribed by SEBI and in Clause 49 of the Listing Agreement is set out below: - 1. COMPANY’S PHILOSOPHY ON THE CODE OF GOVERNANCE

Corporate Governance is based on the principles of integrity, fairness, equity, transparency, accountability and commitment to values. Good governance practices stem from the quality and mindset of the organization. Companies stand to gain by adopting systems that bolster the stakeholders trust through transparency, accountability and fairness. With increasing interdependence and free trade among countries and citizens across the globe, good Corporate Governance should be followed by any company to distinguish itself. Keeping the above in mind, your Company has also committed itself to the philosophy of good Corporate Governance in all its dealings, utmost integrity in its conduct and in compliance with the highest standard of corporate values and ethics. Your company considers Corporate Governance as a continuous journey to provide a congenial environment to harmonize the goals of maximising the stakeholders’ value and maintaining a customer- centric focus in all its dealings with the outside world, besides keeping important segments of the society adequately informed. It has been the Endeavour of the Company to give fair and equitable treatment to all its stakeholders including employees, customers and shareholders. The Code of Conduct for Directors and Senior Managers adopted by the Board of Directors in terms of the Clause 49 of the Listing Agreement shall further enhance the standards of Corporate Governance in the Company.

2. BOARD OF DIRECTORS

The present Board of Directors comprises of six members with two Executive Directors and four Independent Directors. The Independent do not have any material pecuniary relationship or transactions with the company, promoters, management which may affect their judgments in any manner. The Board has eminently qualified and experienced persons in business, finance and corporate management.

a. Composition and category of Directors as on date of this report is as follows:

Category Name of the Directors Promoter / Executive Directors Mr. Lalla Ram Maurya & Mr. Shree Ram

Maurya Promoter Non Executive Directors

-

Non Promoter Executive Director - Non Executive and Independent Directors

Mr. Rajesh Kumar, Mr. Satish Singh, Mr. Piyush Verma & Mr Prabhu Nath Yadav


b. Board Procedure

The meetings of the Board of Directors are informed well in advance. In terms of the company’s corporate governance policy, all significant and material information are placed before the board to enable it to discharge its responsibilities.

Attendance of each Director at the Board Meetings, last Annual General Meeting and Number of other Directorship and Chairmanship/Membership of Committee of each Director in various Companies is given herein below:

Name of the

Director Attendance Particulars

No. of other directorship & Committee member / chairmanship

Board Meetings

Last AGM

Other Directorsh

ip

Committee Membersh

ip

Committee Chairmansh

ip Mr L R Maurya 6 Yes 1 1 1 Mr S R Maurya 6 Yes 1 1 -- Mr Satish Singh 6 Yes -- -- -- Mr Rajesh Kumar

5 Yes -- -- --

Mr Piyush Verma

6 Yes -- -- --

Mr Nath Yadav N/A* N/A* -- -- -- * Appointed as director on 13.08.2011 The Board meets at least once in a quarter to consider among other business, the quarterly performance of the company and financial results. 6 (Six) Board Meetings were held during the financial year 2010-2011. The date(s) on which the meetings were held are as follows:

20-04-2010 22.07.2010 04.09.2010 26.10.2010 29.01.2011 31.03.2011

Mr Lalla Ram Maurya and Mr Piyush Verma retire from the office of Directors at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

3. AUDIT COMMITTEE

The company has an audit committee comprising of 4 non-executive & independent Directors. The audit committee members are accomplished professionals from the corporate and academic worlds.


The composition of the audit committee and attendance of each member as on date of this Report:

Name of Members Status Attendance at audit committee

meeting Mr. Rajesh Kumar Chairman 5 Mr. Satish Singh Member 5 Mr. Piyush Verma Member 5 Mr. Prabhu Nath Yadav

Member N/A*

* Appointed as director on 13.08.2011 The audit committee meets at least once in every quarter. During the year the committee has met 5 (Five) times. All the members of the committee were present in all the meetings held during the year except Mr Prabhu Nath Yadav, who was appointed as director on 13.08.2011. The date(s) on which the Audit Committee met are given herein below:

14-04-2010 18.07.2010 01.09.2010 23.10.2010 27.01.2011

The Chairman of the committee was present at the last Annual General Meeting and will be present in the forthcoming Annual General Meeting to answer the Shareholders queries, if any. The audit committee’s role flows directly from the supervision of the board. The audit committee is responsible for the effective supervision of the financial reporting process, ensuring financial and accounting controls and compliance with the financial policies of the company. The primary functions of the audit committee are:

Overseeing the company’s financial reporting process and the disclosure of financial information to ensure that the financial statement is correct, sufficient and credible.

Recommending the appointment and removal of external auditors, fixation of audit fee and also approval for payment for any other service.

Reviewing of annual financial statements before these are submitting to the Board, focusing primarily on: Any changes in accounting policies and practices. Major accounting entries based on exercise of judgement by management. Qualifications in draft auditors report. Significant adjustments arising out of audit. The going concern assumption. Compliance with accounting standards. Compliance with stock exchange and legal requirements concerning financial

statements.


Approval of the minutes of the previous meetings. Review of matters arising from the previous meetings. Reviewing reports from the management on significant control issues; Reviewing the internal audit plans; Implementing various audit recommendations; Review internal audit performance. Reviewing with the management, external and internal auditors and the adequacy

of internal control systems. 4. REMUNERATION COMMITTEE

In the absence of any remuneration (including sitting fee) being paid to any directors, your company has not constituted a Remuneration Committee. However, the committee will be appointed as and when required.

5. SHAREHOLDER’/INVESTORS’ GRIEVANCE COMMITTEE

As on date of this report, the Shareholder/Investor Grievance Committee comprises of four Directors, namely, Mr Rajesh Kumar, Mr Satish Singh, Mr Piyush Verma and Mr Prabhu Nath Yadav. Mr Rajesh Kumar is the Chairman of the Committee. The committee, inter alia, approves issue of duplicate share certificates, looks into and redress shareholders’ complaints like non receipt of annual report / balance sheet, non receipt of declared dividends, dematting, rematting of shares etc. and also oversees and reviews all matters connected with the delay in transfer of securities. The Board has delegated the power of approving of transfer of shares to the Share Transfer Committee. The Share Transfer Committee generally meets once in a fortnight. The total number of complaints received during the year under review was 7 (from investor) and all the complaints were resolved on time. Further, the company has not received any complaints from NSDL/CDSL and other statutory authorities pertaining to shareholders grievances during the financial year 2010-2011. There is no outstanding complaint as on 31-03-2011.

6. ANNUAL GENERAL MEETING

The Annual General Meetings of the Company have been held in the last three years. 2007-08 30.09.2008 C-4/118, Safdarjung Development

Area, New Delhi 11.00 AM

2008-09 30.09.2009 C-4/118, Safdarjung Development Area, New Delhi

11.00 AM

2009-10 30.09.2010 C-4/118, Safdarjung Development Area, New Delhi

11.00 AM

During the year no resolution was passed through postal ballot. 7. DISCLOSURES

a. Disclosures on materially significant related party transactions i.e. transactions of the Company of material nature, with its promoters, the directors or the management, subsidiary or the relatives of the Directors, etc. that may have potential conflict with the interest of the Company at large.


None of the transactions with any of the related party were in conflict with the interest of the company. The transactions with the related party are disclosed in Note No. 8 of Schedule 19 containing Notes to Accounts.

b. Details of non-compliance by the company, penalties structures imposed on the

company by stock exchange or SEBI, or any other statutory authority, on any matter related to the capital markets, during the last three years.

The Company has done all compliances timely. No penalties, strictures has been imposed on the company by stock exchanges, SEBI or any other statutory authority on any matter related to capital markets during the year. The Bombay Stock Exchange has suspended the shares of the company w.e.f. 10.09.2001 due to Non Compliance of Listing Agreement Clauses on that time. Now Company is complying all the directives and have made request with the Stock Exchange to revoke the suspension.

8. MEANS OF COMMUNICATION The quarterly, half yearly and annual results are sent out to all the stock exchanges where the securities are listed immediately after they are approved / noted by the Board of Directors. The Management Discussion and Analysis Report forms part of the annual report

9. GENERAL SHAREHOLDERS INFORMATION

i. Annual General Meeting: Friday, 30th September 2011 at 11.00 AM at C-4/118, Safdarjung Enclave, New Delhi.

ii. Financial Year: 1st April, 2010 to 31st March 2011

iii. Approval of Quarterly Results Results for the quarter ending March 31 20th April, 2010 Results for the quarter ending June 30 22nd July, 2010 Results for the quarter ending September 30 26th October, 2010 Results for the quarter ending December 31 29th January, 2011 iv. Book Closure Date 27th Sept, 2011 to 30th Sept 2011

(Both days inclusive) v. Dividend Payment Date No dividend has been

recommended by the Board of Directors for the year ended 31st March 2011.

vi. *Stock Exchanges where the securities are listed i. U.P. Stock Exchange Association Ltd. ii. Delhi Stock Exchange Association Ltd. iii. Mumbai Stock Exchange

vii. Stock Code INE710C01012


*The Company has passed necessary resolutions to apply for delisting of its securities from the Delhi Stock Exchange Association Ltd. & The U.P. Stock Exchange Association Ltd pursuant to SEBI Guidelines for voluntary delisting. However, the same is put on hold due to procedural matters.

viii. Share Transfer System: In terms with the requirements of SEBI, company has

entered into an agreement with M/s. Beetal Financial & Computer Services Private Limited at their address at Beetal House, IIIrd Floor, Madangir, Behind Local Shopping Centre, Near Dada Harsukdas Mandir, New Delhi-110062..

ix. Stock Market Data: There was no trading during the financial year 2010-2011 as

per data available at the BSE site.

x. Distribution of Shareholding as on 31.03.2011: Category No. of Shareholders % of total Number of Shares held % of total Up to 5000 10985 94.45 1617760 28.30 5001 to 10000 385 3.31 314307 5.50 10001 to 20000 155 1.33 237301 4.15 20001 to 30000 41 0.35 103900 1.82 30001 to 40000 11 0.10 40900 0.71 40001 to 50000 21 0.18 101400 1.77 50001 to 100000 16 0.14 112769 1.97 100000 and above. 16 0.14 3187850 55.78 Total 11630 100.00 5715387 100.00

xi. Shareholding Pattern as on the date of this report:

Category No. of Shares held % of total Promoters 2156150 37.72 Corporate Bodies 1038669 18.17 Indian Public 2509968 43.92 Relative / Friends / Associates of Directors (Independent and are not in control of the Co.)

10700 00.19

Total 5714687 100.00

Promoters38%

Pvt. Corp. Bodies18%

Indian Public44%

Relatives & Friends of Directors

0%


xii. Dematerialization of Shares: Over 10.19% of the shares have been dematerialised up to 31-03-2011.

xiii. Outstanding GDR/Warrants and Convertible Bonds, conversions date and likely

impact on the equity: There are no GDR/Warrants and Convertible Bonds issued by the company.

xiv. Plant Locations: Raj Nagar, G.T. Road, Dist. Bhadohi, Gopiganj (U.P.) xv. Investor’s Correspondence: Raj Nagar, G.T. Road, Dist. Bhadohi,

Gopiganj (U.P.) (For Shares transfer / dematerialization of shares, payment of dividend, and any other query relating to the securities of the Company)

xvi. Registrar and Share Transfer Agent: M/s BEETAL Computer & Financial

Services Pvt. Ltd. has been appointed as RTA.

10. CEO/CFO Certification: A Certificate from Chairman and Managing Director and

Finance head on the financial statements of the Company placed before the Board.

11. Code of Conduct: The Board has formulated code of conduct for the Board members and Senior Management of the Company, it is hereby affirmed that all the Directors and senior management have complied with the code of conduct framed by the Company.

12. Compliance Certificate of the Auditors The Company has obtained the certificate from the statutory auditors regarding compliance of conditions of Corporate Governance stipulated in Clause 49 (viii) of the Listing Agreement and the same is annexed.

For IDEALCARPETS LIMITED Place: New Delhi Date: 02.09.2011 L R Maurya

(CHAIRMAN)


IDEAL CARPETS LIMITED

DECLARATION BY THE CEO UNDER CLAUSE 49 OF THE LISTING AGREEMENT REGARDING ADHERENCE TO THE CODE.

In accordance with clause 49 sub-clause 1(d) of the Listing Agreement with the Stock Exchanges I hereby confirm that all the Directors and the Senior Management Personnel of the Company have affirmed compliance to their respective Codes of Conduct as applicable to them for the Financial Year ended on March 31, 2011.


(CHAIRMAN)



CEO/CFO CERTIFICATE

The Members, Ideal Carpets Limited New Delhi I, L.R.Maurya, Chairman and Managing Director (CEO), on behalf of Ideal Carpets Limited (the Company), to the best of my knowledge and belief, certify that: -

1. We have reviewed the Balance Sheet and Profit & Loss Account (consolidated and standalone) and all the schedules and notes on accounts as well as the Cash Flow Statement, and the Directors Report.

2. Based on our knowledge and information these statements do not contain any

untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the statement made.

3. Based on our knowledge and information, the financial statements and other

financial information included in this report, present in all material respects are true and fair view of the company’s affairs the financial condition, results of operations and cash flows of the company as of, and for the periods presented in this report and are in compliance with the existing accounting standards and/or applicable laws and regulations.

4. To the best of our knowledge and belief no transactions entered into by the

Company during the year are fraudulent, illegal or violative of the company’s code of conduct.

5. We are responsible for establishing and maintaining disclosure controls and

procedures and internal controls over financial reporting for the Company and we have:


a) Designated such disclosure controls and procedures to ensure that material information relating to the Company is made know to us by others within those entities particularly during the period in which this report is being prepared.

b) Designed such internal control over financial reporting or caused such

internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with Generally Accepted Accounting Principles (GAAP)

c) Evaluated the effectiveness of the company’s disclosure, controls and

procedures. d) Disclosure in this report any change in the company’s internal control over

financial reporting that occurred during the company’s most recent fiscal year that has materially affected or is reasonably likely to materially affect the company’s internal over financial reporting.

6. We have disclosed based on our most recent evaluation, wherever applicable to

the company’s auditors and audit committee of the company’s board of directors (and persons performing the equivalent functions)

a) There were no deficiencies in the design or operation of internal controls,

that could adversely affect the company’s ability to record, process summarize and report financial data and there have been no material weaknesses in internal controls over financial reporting including any corrective actions with regard to deficiencies.

b) There were no significant changes in internal controls during the year

covered by this report.

c) All significant changes in accounting policies during the year, if any, and that the same have been disclosed in the notes to the financial statements.

d) There were no instances of fraud of which we are aware that involve the

Management or other employees who have a significant role in the company’s internal control system.


7. In the event of any materially significant misstatements or omission, we will return to the company that part of any bonus or incentive or equity based compensation which was inflated on account of such errors.

8. We affirm that we have not denied any personnel, access to the audit committee

of the Company (in respect of matters involving alleged misconduct) and we have provided protection to whistleblowers from unfair terminations and other unfair or prejudicial employment practices.

9. We further declare that all Board members and senior managerial personnel have

affirmed compliance with the code of conduct for the current year.


(Chairman and Managing Director)

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